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Another Bailout Joins the Goofball Economy

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Posted on Aug 9, 2011
Jacob Bøtter (CC-BY)

By Robert Scheer

The whole thing is nuts. The economy is a shambles, saved from a free fall only by the Federal Reserve’s unprecedented promise of free money for banks for at least two years. That’s how long a seven-member majority of the Fed’s Open Market Committee expects it to take for significant relief to take hold for the 25 million Americans who can’t find full-time employment. 

The 10-member committee’s three dissenters in Tuesday’s decision, all unelected Fed regional board presidents, are free-market ideologues who don’t believe the government has a role to play in reversing the nation’s economic disaster. One is a former Wall Street investment banker and vice chairman of Henry Kissinger’s consulting firm. The other two are University of Chicago school of economics disciples long committed to free-market purism and blind faith in the mathematical models that had much to do with radical deregulation and the subsequent collapse of the financial markets.

That view led Minneapolis Fed President Narayana Kocherlakota, before he assumed his Fed position, to sign a petition that the libertarian Cato Institute placed in various newspapers opposing President Barack Obama’s economic stimulus plan. 

The dissent of the three members is thought to have prevented the Fed from pursuing more vigorous action such as the anticipated “QE3” purchase of additional securities. As New York Times columnist Floyd Norris speculated, “perhaps the dissenters really want to essentially say something like ‘We’ve done all we can, and if the economy is still lousy, that is for someone else to deal with.’ ” 

Meanwhile, Obama has been reduced to an impotent bystander promising vigorous budget cuts in response to Standard & Poor’s adverse credit rating. The president’s pathetic performance on Monday, as the market crashed, was the low point of his career. Nor did it help that the rush of investors to Treasury bonds validated his bold claim that the United States of America deserves a perfect credit rating. On that point he is right, but Obama’s failure to challenge the idiocy demanded by S&P, along with the Republicans—that government spending be dramatically cut in the face of an economic crisis—cast his remarks as terminally tepid.

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How dare a credit rating agency that got it so wrong, and should itself be investigated for malfeasance in the creation of the banking meltdown, dictate public policy? For S&P to insist on massive government cuts that would only increase joblessness is like a burglar shifting blame for his crimes to the poor quality of locks.

This from a credit rating agency that, as NYT columnist Joe Nocera points out, “has consistently fallen short.” S&P judged Enron to be an exemplary company until shortly before the corporation imploded, and it gave its triple-A seal of approval to the toxic securitized mortgage debt that caused the great recession. There are serious problems with the U.S. economy, but they are not the ones that Standard & Poor’s outlined when it sent the stock market into a tizzy. 

We don’t need draconian cuts in government spending at a time when the economy remains mired in deep unemployment, when state and municipal governments are shedding jobs and when the housing market is on life support. And if some Amercians thought that we did and voted to put irresponsible Republicans in charge of the House of Representatives, isn’t it the duty of the president and his fellow Democrats in control of the Senate to fight back? That’s called democracy, and we need more of it instead of the false unity for which Obama settled. 

Sure, it would have been much better if a phony populist movement called the tea party had not been financed by fat cats out to preserve their unseemly tax breaks and thereby gained control of the House. That’s what undermined what S&P termed the “effectiveness, stability, and predictability of American policymaking and political institutions [that] have weakened at a time of ongoing fiscal and economic challenges. …” But, as S&P acknowledged with its downgrade after the congressional vote on the debt ceiling, the fact that the president caved was of no help.

The result is that Obama has agreed to effectively remove the elected federal government from the battle to restore economic health and instead left us to the tender mercies of the banker-dominated Federal Reserve, which, like the folks at S&P, condoned the reckless Wall Street policies that got us into this mess. At a time when we need a full-throated defense of the role of government in protecting the interests of a majority of Americans suddenly made deeply vulnerable by the chicanery of the financial oligarchy, we are denied even the logical clarity of a former community organizer who once promised hope.

Click here to check out Robert Scheer’s new book,
“The Great American Stickup: How Reagan Republicans and Clinton Democrats Enriched Wall Street While Mugging Main Street.”


Keep up with Robert Scheer’s latest columns, interviews, tour dates and more at www.truthdig.com/robert_scheer.

Click here to check out Robert Scheer’s book,
“The Great American Stickup: How Reagan Republicans and Clinton Democrats Enriched Wall Street While Mugging Main Street.”


Keep up with Robert Scheer’s latest columns, interviews, tour dates and more at www.truthdig.com/robert_scheer.



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David J. Cyr's avatar

By David J. Cyr, August 15, 2011 at 6:12 am Link to this comment

QUOTE (of an avatar, being a painting in many shades of (D)evious blue):

“I would like you [David J. Cyr] to clarify what you mean by violence. I have long been a proponent of non-violent action in the form of non-violent: protest, demonstration, and civil-disobedience.”

_______________________

The objective reality is that there is no nonviolence. The liberals who insist that all confrontations with, or resistance to the corporate-state must be “nonviolent” serve to protect the state’s monopoly upon violence.

People either support the corporate-state’s greater violence that will inevitably end in human extinction, or they support the lesser violence of resistance (by whatever means necessary) that might allow humans to survive. Whether in the voting booth or in the streets, the “nonviolent” liberals always reliably choose to support the greater evil.

A brief summary of the history of ultra-violence that “nonviolent” liberals have:

Flush with uber pride, after liberals had won the 2nd world war between fascists, Democrat Truman dropped atomic bombs on the civilians of a defeated nation, to publicly demonstrate that enlightened liberals had both the ability and the desire to exterminate untermenschen faster, easier and more efficiently than any other fascists could.

The liberal Democrat Kennedy made fascism glamorous (fashionably cool), while he established the Special Forces to covertly combat rebels in colonies, and he built up the School of the Americas — an international university for the proliferation of torture, repression, and political murder.

When the liberal Democrat Johnson lied over 3 million Southeast Asians were murdered in the highly profitable industrial scale slaughter designed by the “best and the brightest” that liberals had to offer.

The liberal Democrat Carter’s doctrine informed the people of the Middle-East that the oil they lived over belonged to America, Inc.; and when the Soviet Union was nearing collapse Carter OK’d the “best and brightest” idea of Zibigniew Brzezinski (Carter’s brain), to proxy military recruit the most insane Muslim religious berserkers… to first eliminate America’s no longer useful tired old external threat (the USSR), and then provide a new and improved external threat — stateless terrorists who can be created as needed, employed, and then destroyed.

After the fall of the Soviet Union NATO should have been disbanded, but the degenerate Democrat POTUS, Clinton, deployed his Field Marshall (Madelein Albright) to create conditions convenient for a “humanitarian” military intervention. The liberal loved Clinton bombed Yugoslavia to provide a pretext for creating a new mission for NATO. Clinton turned the defensive deployed NATO into an expeditionary force in serial resource wars of aggression.

The “nonviolent” liberals were wet loin excited when they voted for Obama, who promised them “dumb” war would be relabeled “necessary” war. The “nonviolent” liberals’ deeply depraved Democrat POTUS, Obama, removed Cheney/Bush’s limitations upon torture (comfortingly put torture back out of sight out of mind); intensified covert domestic surveillance; and increased the use of private mercenaries and robotic weaponry.

No person (or avatar thing) that votes for Democrats has any credibility when they claim to be nonviolent.

http://www.chenangogreens.org

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By JDmysticDJ, August 13, 2011 at 2:14 pm Link to this comment

Marian Griffith has me at a disadvantage, primarily because of interest; clearly she has more interest in the academics of economics than I do. I did plod through William Greider’s, “Secrets of the Temple.” In that book Greider comments at great length about the consequences of Paul Volker’s Federal Reserve actions, so maybe I’m the victim of Greider’s prejudices.

It’s not that I have absolutely no interest in High Finance, (or wheeling and dealing if you prefer,) after all, the actions of those who control our economic policies affect us one and all. What interests me the most about economics is what I will call Macro Macro Economics. I don’t believe in the old axiom about statistics being more deceptive than damn liars. Statistics that have been tabulated and verified by impartial data and peer reviewed are valuable by my appraisal. Where statistics become a problem, by my appraisal, is when statistics are used to predict and not to assess. For example, using statistics to predict positive outcomes when statistics have assessed that that those same predictions made earlier in time were harmfully errant shows that the real value of statistics is as being assessors and not predictors. I prefer to rely on lessons learned and not to rely on speculations proven to be errant, not to mention that those predictions were counter intuitive.

When data shows that just 400 people possess more wealth than 150 million Americans, I find that data to be useful and enlightening. I heard recently on the radio that the combined assets of people who possess a million dollars or more equals 38 trillion, which puts our comparatively paltry Federal Deficit in some perspective.

Marian Griffith maintains that “Quantitative Easing” to reduce our deficit would be stealing because of inflation, while some believe that Quantitative Easing to the benefit of Financial Institutions is good for our economy. That Quantitative Easing for the benefit of Financial Institutions may be good for Financial Institutions, and their holders, but so far it has not proven to be good for ordinary Americans by my appraisal. Quantitative Easing, don’t you just love that term?

Now, do I advocate stealing the obscenely excessive riches from the richest Americans? No, I advocate legally sanctioned action by legislation to force the obscenely rich to return what they have stolen. I know both theft and obscenity when I see them.

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By Marian Griffith, August 13, 2011 at 2:35 am Link to this comment
(Unregistered commenter)

@JDmysticJD
I forgot to add (ran out of room to comment and forgot in the editing process) that another danger posed by inflation is that of decreasing trust in the currency.
Money really is an anonymous IOU note. It represents the promise that at any time it can be exchanged for a good or service that is more or less of equal worth as the good or service exchanged to obtain the money.
The higher the inflation the less that promise of ‘equal worth’ is true, and the more people realise this the less they are inclined to keep money and the more they exchange it for goods, which retain their worth no matter what the money does. The worth of a loaf of bread is that it will feed you and your family for a day or two no matter how much you pay for it in terms of money.
And the less money people keep the more problems shops will have to buy stock, and companies will have difficulty finding money to invest in producing goods.
At some point it may become bad enough that people stop trusting the currency entirely and start looking for another one they feel is more stable, or they do away with money entirely and resort to direct bartering. The first will cause a lot of misery for the people who are paid in the, now useless, old currency and need an (often illegal) way to exchange it for money that is still accepted. In the second case the entire economy collapses as any production that is not locally consumed becomes pointless.

And this is another reason why the rest of the world is a wee bit uneasy with America’s flirt with inflation to reduce the burden of its debts. At this point the global economy is entirely driven by fear and rumous, and trust if it goes will go very quickly indeed (as e.g. Greece, Ireland or Portugal can attest). Just by looking at this discussion board you can see for yourself the depth of distrust in government and finances, and how easily this distrust can become panic.

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By Anarcissie, August 12, 2011 at 8:04 pm Link to this comment

The more contemporary thing seems to be to inflate credit rather than currency.  Since major amounts of credit are available only to the rich, the funny money goes to inflate real estate, equities, and collectibles and leaves the CPI largely alone, so that poor people’s money still tends to represent labor and the things that labor produces.  There are crossover points between the upper and lower monetary realms, however, which bodes ill for long-term stability.  One of them is that portion of real estate to which the poor are permitted access, and another is in commodities, where games played with energy and other futures may cross over into higher retail prices for ordinary people.  A good example of what I’m talking about was the subprime mortgage collapse, which began when the prime rate was raised and suddenly numerous marginal mortgagors couldn’t make their payments.

The interesting thing about credit is that, unlike currency, it can disappear—can be disappeared, one might say—almost instantly.  This may have some bearing on how America’s rather extensive tab gets unwound.

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By Marian Griffith, August 12, 2011 at 3:30 pm Link to this comment
(Unregistered commenter)

@JDmysticJD
—-The matter of who are, or would be, the thieves and stealers is a matter of perception.—-

It is only a matter of perception in the sense of the british looters calling what they do ‘alternative shopping’.
If you promise to pay somebody a million dollar and then make sure that in the mean time that the money was inflated so you can buy only 500.000 worth of goods then you have, in essence, stolen 500.000 from somebody.

And inflation will hurt people on a fixed income worst, but it will hurt everybody as soon as it is more than a few percents. Companies that need to extend a short term loan to pay salaries or to buy raw materials will have to pay a higher interest rate on that, which means they have to increase the price of their goods or go out of business. The american economy is much more credit drive these days (with companies encouraged to not have any money of their own and handling all payments through short term loans, on the grounds that money in the bank is not earning the company any income, but ignoring that it buys the ability to tide over a lean period).
Higher inflation means higher interest rates on mortgages and unless your salary is indexed for the inflation you will actually get poorer even if your income is raised (which incidentally is exactly what happened to much of america’s middle class. Their income increased but it more or less matched the inflation, leading to a stagnation in abilty to purchase, and to the increasing use of personal credits to keep up with increasing desire to buy things).
When inflation gets bad enough indexing no longer becomes realistically feasible. When exactly this happens depends on government and economic culture. The USA with its weak government and somewhat self-centered approach to economy will probably drop indexing sooner than most European countries would.

But when you stop indexing for inflation you are in risky waters indeed. Employees will see a significant decrease in wealth at the end of the year and will demand increases in income to match. If companies give in then they have to raise their prices, which increases the inflation again and a runaway effect becomes possible. If they do not give in then workers will become restless. The USA has effectively killed off unions, but this only will return the country to the early days of unionisation when unions were synomymous with communists and violent clashes between workers and police were the norm rather than the exception. People will not, after all, take being forced into subsistence gracefully and some at least will fight back.

So, no, inflation is not a zero sum effect. There is a good reason why the rules of the Euro zone put a very low limit on the maximum inflation any member state is allowed to have. It will drag down an economy very quickly, and it is easy to lose control over it, at which point you are faced with the prospect of several years of economic and social devastation and either the introduction of a new coin or being forced to give up your national currency entirely. (Germany only recovered after it was bombed down to rubble, had a new currency introduced and an entirely new code of laws dictated by the victors of WW2. More recently Zimbabwe has given up its currency completely, leaving its government no means to control the economy except for violence and brute police/military force).

The USA, as I mentioned before is a bit of a special case here so the worst will not happen until after the rest of the world manages to extricate itself froom the dollar as the reserve currency and de facto baseline of all economic transactions. But you still will not want inflation of, say, 10 pct.

And this is not ‘high finance’ but rather opposite of ‘basic economic theory’

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JDmysticDJ's avatar

By JDmysticDJ, August 12, 2011 at 12:36 pm Link to this comment

I’m muddling through becoming better informed about High Finance.

Marian Griffith writes:

“Now when a country prints massive amounts of banknotes (or creates them with a press of the button as is the case nowadays) this means that the investors holding the debt notes are cheated out of their money.”

And:

“The difference in worth of that money (i.e. the difference in what you could buy with the loan before and after the inflation) is effectively stolen, and generally results in less trust and higher interest rates for future loans.”

The matter of who are, or would be, the thieves and stealers is a matter of perception. Austerity for the many and prosperity for the very few is the reality of today’s consensus in policy. The Right has been very successful in framing this issue and all discussion includes austerity for those most in need. Max Baucus’ inclusion as a Democratic member of the “Super Committee” does not bode well for those advocating “Shared Sacrifice.”

Inflation has historically included inflation of wages; it could be argued that inflation as it affects workers is a zero sum gain. Up until last year, inflation was factored into the payments of Social Security recipients. Whether adjustments in payments to Social Security payments because of inflation will be the reality in the future is, to the best of my knowledge, undetermined. 

Paul Volker, a Liberal favorite as Federal Reserve Chairman, battled against inflation and has been credited with lowering inflation. Some have argued that Volker’s allowing inflation rates to stay high was one of the factors that contributed to the destruction of American manufacturing and to the plight of small farmers, a plight brought to light by the “Farm Aid Concert.”

Those hurt the most by inflation are fixed rate bond holders. Not being a business major or even having any interest in High Finance, I’ve done a brief research of the many kinds of bonds and I have to confess that understanding the intricacies of the variety of Bonds is beyond my ability to comprehend. I would be a total failure as a wheeler and dealer in Bonds, but there are those who wheel and deal with good results to their goal of accumulating wealth.

This is not the forum for an education in High Finance so I’ll desist. The most cogent statement here I believe comes from MeHere, August 11 at 5:35 pm:

“Our responsibility as citizens and members of society is
to be aware of who are those we are trusting to manage the economy.  The
facts are everywhere and they speak for themselves: high unemployment, cuts
in education, and health care, endangered social programs, military
interventions all over the globe, no comprehensible foreign policy, no
substantial plans to tackle energy and environmental problems, no
manufacturing base, corrupt lawmakers, non-democratic elections…. while the
private and corporate small percent of the population becomes wealthier and
gets the full attention of our government. That’s our economy -the rest is academic.”

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By JDmysticDJ, August 12, 2011 at 10:10 am Link to this comment

RE: David J. Cyr, August 12 at 5:49 am

The Violence of “Nonviolence” or the Nonviolence of violence, are obvious oxymorons. I would like you to clarify what you mean by violence. I have long been a proponent of non-violent action in the form of non-violent: protest, demonstration, and civil-disobedience. Personally, I think the statement should be “The violence of apathy.”

There are innumerable examples of violence leading to greater violence. There are also innumerable examples of violence being counter productive to objectives.

People mellowing with age is a truism; whether that mellowing is a positive or a negative is subject for dispute and would depend on the degree of “mellowing” on a case by case basis. I can give you examples of elders in primitive societies counseling against war i.e. violence, where the ignoring of that counsel had tragic consequences for that primitive society. I can also give examples where more modern societies ignored counsel against war i.e. violence, which led to tragic consequences.

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David J. Cyr's avatar

By David J. Cyr, August 12, 2011 at 5:49 am Link to this comment

re: “Trust no one over the age of 30”
____________________________

Safe and useful exceptions exist, but they are exceptionally rare.

As people mature within the System they become entangled with it — become a part of it — whether they wish to be, or not. Even if our hearts and minds remain young and rebellious, the more we age the more we serve to protect the System, in more varied ways and by more subtle means… either consciously, or unconsciously.

The security of the empire is dependent upon the family unit (Augustus understood this back in BC). The rebellion of the young is tamed when they wed and procreate. Protecting their immediate families from any risk of the wrath of Power becomes far more important to parents than protecting their society from the ruthless policies of Power… more important than even protecting their species from certain extinction if the insatiable growth of Power and consequent degradation of planetary environment is not ended.

If the young do not rise up and remove My Generation from power soon, then there surely won’t be many generations left to come.

The Violence of “Nonviolence” :

http://chenangogreens.org/home/index.php?option=
com_content&task=view&id=492&Itemid=1

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By RayLan, August 12, 2011 at 5:41 am Link to this comment

I’m afraid things will have to get worse before they get better - The uniformed unthinking belief in the myth of ‘free enterprise’ capitalism is still unshaken. Neither the Feds quantitative greasing nor the so-called austerity program implemented by the overpaid indulgent corporate pigs who pull Washington around by the nose, nor even welfare for unethical banks will remedy the collapse. A deep re-structuring is called for - a radical new kind of governance that holds the well-being of all citizens as its highest priority will work.

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By MeHere, August 11, 2011 at 5:35 pm Link to this comment

I admire the efforts of those who post here at trying to figure out the economic
problems of the country.  It is a complex subject on which not even many
experienced economists agree when it comes to problems and solutions. There
are plenty of sources to get informed and learn a lot on the subject if one has
enough interest in it.  But that kind of knowledge is not really a requirement to
know what’s going on. 

Our responsibility as citizens and members of society is
to be aware of who are those we are trusting to manage the economy.  The
facts are everywhere and they speak for themselves: high unemployment, cuts
in education, and health care, endangered social programs, military
interventions all over the globe, no comprehensible foreign policy, no
substantial plans to tackle energy and environmental problems, no
manufacturing base, corrupt lawmakers, non-democratic elections…. while the
private and corporate small percent of the population becomes wealthier and
gets the full attention of our government. That’s our economy -the rest is academic.

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By Marian Griffith, August 11, 2011 at 2:28 pm Link to this comment
(Unregistered commenter)

@JDmysticJD
—-why can’t the Federal Reserve provide our government with the trillions of dollars necessary to make our Federal Deficit manageable?—-

The federal reserve can not really do that.
Or rather, it is called creating inflation and it makes foreign investors very nervous.

The root of the misunderstanding is in that most people presume that money -is- the thing of value. In reality it is only a glorified IOU note, and it can function only when everybody can trust that if they exchange some good or labour for money on one day they can then exchange that money for goods or labour of what they perceive is comparable value.
Inflation happens when the amount of money increases but the amount of goods and labour does not. The same amount goods or labour then then requires more money (simply because everybody has more bits of paper and a bigger number on the printout of their savings account).
On a small scale this is inconvenient, as you notice that that burger that cost you 1 dollar a few years ago now costs 1 dollar 20. The burger has not changed, but the extra 20 cents is the result of inflation. Most economists agree that a small amount of inflation is beneficial (as it is not possible to perfectly match production and money supply and a shortage of money generally has worse effects on the economy).
Now when a country prints massive amounts of banknotes (or creates them with a press of the button as is the case nowadays) this means that the investors holding the debt notes are cheated out of their money. The country will pay the exact amount of monetary units as they promised, only you can not buy nearly the same amount of goods or labour with them then you could when the loan was first extended. The difference in worth of that money (i.e. the difference in what you could buy with the loan before and after the inflation) is effectively stolen, and generally results in less trust and higher interest rates for future loans.
Now the USA is a special case and they have gotten away with similar things in the past, but the amount of money owed and the degree by which world economies are entwined nowadays makes it a very risky strategy indeed. The downgrading of the credit rating by S&P was a warning that it no longer considers the USA so special that it can get away with international theft and fraud on a large scale and instead must get serious about getting its books in order same as every other country.

The rally towards the USA treasury bonds that are generally taken as proof that the rating downgrade was meaningless is in reality a sign of panic and traders knowing no other place to park their surplus money (the USA economy is the only one big enough to absorb large amounts of money now the traders have collectively decided to distrust the EC). Should miraculously the european countries get their affairs in order then the USA would find it needs to increase the interest rates on its new bonds to attract money. The USA economy is already suffering of too much money and too little economy and the last thing it needs is another round of quantitative easing (which is a fancy word for running the money printing press). Keeping the interest rate this low already is damaging the long term recovery prospects. Interest rates should rise, but this would further stagnate the economy at this point, but keeping it this low will only bleed money out of the economy that is needed to boost trust and spending.
The blame for this must be put on Bush and his neocons, who should have let the banks go broke and spend the trillians on easing the problems for the people, instead of propping up the inproductive financial sector and stagnating the economy. (banks got rich thanks to them though). Obama is out of options thanks to the deadlock in the House.

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By JDmysticDJ, August 11, 2011 at 1:18 pm Link to this comment

Most would agree that ignorance is a bad thing and something to be avoided, but I’m not afraid to display my ignorance if it will help me to become better informed. Over the course of my life I have had little interest in the world of high finance, but I have known for half a century that the rich exploit ordinary people in order to enrich themselves, and that their greed is insatiable.

The rich measure their self worth by their possession of wealth, and the individual who has assets of 100 million feels inadequate compared to those who have greater assets. The quest for increasing assets is what governs their lives, and all too frequently the quest for wealth becomes secondary to issues like ethics, and the welfare of those whose lives they control.

Using Bernie Madoff as an example, he was dissatisfied with owning a legal firm and having assets in the millions, he wanted more; more wealth and more status, and his lust for wealth and status led him into fraudulent business practices. The fraudulent business practices of Wall Street Mavens and the lack of concern for ordinary people demonstrated by Corporate Magnates has been well documented, and the results are manifest.

That’s not to say that ordinary people are not also governed by the quest for wealth and status. The quest for wealth and status permeates all levels of a Capitalist society; altruism is given short shrift, and individual accomplishment in the accumulation of wealth is a measurement of success, or relative status. A false meritocracy reins supreme, as if the measurement of wealth is also the measurement merit. People who labor diligently, while being subject to exploitation, in order to provide a home and sustenance for their families are worthy of merit, while those willing to sacrifice personal comforts and who actively confront injustice, and object to being exploited, are perceived as being radical and are perceived to be without merit, by most, but most tangibly by their “superiors.” The realities of bureaucracy assure that these perceived radicals will be left powerless unless they can conceal their perceived radicalism. Revealing their perceived radicalism will immediately result in their diminution in bureaucracy, so they remain powerless. Such is evident in our politics, those who reveal their perceived radicalism are in the minority and thus powerless to achieve their objectives. Such provides the rationale for political expediency. Politicians conceal their perceived radicalism for the sake of political expediency. Such are not examples of profiles in courage, but they are examples of political expediency. Where we find ourselves today is in a situation where political expediency has taken precedence over achieving objectives.

Clearly one end of the political spectrum has been promoting this perception of radicalism and a dialectic defining radicalism along with a vast expenditure of resources to promote this perception of radicalism has been occurring, and that end of the political spectrum has been very successful in achieving that goal. To put it bluntly, lying and a desire to preserve policies that have been proven detrimental to ordinary people but beneficial to the very few, and a preservation of the status quos has been the impetus of this well financed propaganda. Political strategy is refined at well funded think tanks, policies are defined, and Bills are written by these unelected manipulators of government.

(More)

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By JDmysticDJ, August 11, 2011 at 1:15 pm Link to this comment

I have digressed here from the intent of my post. My ignorance of high finance leads me to ask; if the Federal Reserve can provide trillions of dollars in no interest loans to Financial Institutions, why can’t the Federal Reserve provide our government with the trillions of dollars necessary to make our Federal Deficit manageable?  Surely the yield on treasury bonds exceeds the yield of no interest loans.

Cut spending on wars, the military, and the preservation of Empire. Cut spending on counter productive subsidies for business, increase revenues by productive tax policies, yes, but why can’t we consolidate our debt with no interest loans from the Federal Reserve?

I am not proclaiming a great epiphany or delusional about my ignorant recommendation ever becoming a reality, I’m only asking for information. The largest holders of U.S. debt are the “entitlement programs.” Entitlement programs account for over 50% of U.S. debt holders. Entitlement Programs have invested their surpluses in U.S. Treasury bonds, consolidating debt with no interest loans from the Federal Reserve would eliminate the interest revenues received by Entitlement Programs. Perhaps the U.S. Government assuming control of entitlement program trust funds and paying entitlement recipients on demand would facilitate reducing debt obligations. Creating a zero sum gain might necessitate adjustments in revenues or payments but would result in debt reduction would it not?

Is it possible that eliminating the 40% of current revenues to the Federal Government that go to service the debt would not result in the necessity of increased contributions or reduced payments to entitlement recipients but would facilitate higher payments to entitlement recipients?

Are there any quick fixes or miracle solutions?  Are we doomed to living under Capitalist oppression or destined for destruction because of our excesses? I prefer to think not. Eliminating Capitalist oppression and our excesses seems to be the most promising course of action. Preserving the status quos will not achieve either of these goals. Whether Obama and the Democrats are committed to preserving the status quos or committed to changing the status quos is a subject for much disagreement among the Left, but it should be obvious that those from a Right perspective are those who are most committed to preserving the status quos power structure. The Right advocates changes in government policy, but the changes they advocate only serve to preserve and facilitate the true holders of power i.e. the status quos of corporate power.

Speaking of ignorance, there are distortions of reality here on this thread that can only be the result of ignorance or the result of becoming influenced by demagoguery in my most humble opinion smile

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By MeHere, August 11, 2011 at 12:53 pm Link to this comment

David J. Cyr on 8/11

Thanks for your post and the included link to the Jensen el al article.  Just a
thought regarding “don’t trust any one over the age of 30”: What will happen to
those who are 28 now and will be 31 in three years? Not to be trusted anymore?  I think I know what you mean, but the reality is that all kinds of people who understand the problems are needed to change things.

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By glider, August 11, 2011 at 11:21 am Link to this comment

Lafayette,

You are living in a dream world. The public is on average very busy working for a living and is skillfully manipulated by our Corporate Media and our Bought Politicians.  “Our” system is not a democracy and is rigged by the private money that finances its political processes.  Consider all the factors together and the public does not get the governance they vote for, nor will they ever have a chance to achieve that end.  To say that the deliberately manipulated public “deserves the shaft” is akin to cheering on child molester.

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By Marian Griffith, August 11, 2011 at 10:47 am Link to this comment
(Unregistered commenter)

@Samson
—-And it will probably happen again.—-

No probably about it. It WILL happen again. Simply because getting elected requires a fortune in brainwashing tv ads, and by now only the big corporations have the money for that. And thanks to the unmitigated disaster that is the supreme court they no longer have any legal restrictions either on their ability to buy candidates.

And it does not matter if the angry and disillusioned manage to get Obama out of office or not. Any candidate will need the money only the corporations can provide to stand a chance at elections, and that money does not come without strings attached.
It really boils down to picking the candidate that does least damage. And if anybody believes that Obama has done more damage than McCain/Palin would have done, or that say Perry/Bachman will do, then I fear there really is no hope for the country, and the rest of the world will watch with mild dismay, from a safe distance, how the USA self-immolates.

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By felicity, August 11, 2011 at 10:28 am Link to this comment

CJ - Ah yes, the rarefied world of the Dimons.  One of
his ilk recently rented a beach house in my extended
community for $175,000/month.  Yes, that is per month.

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By Anarcissie, August 11, 2011 at 9:34 am Link to this comment

truedigger3—Generally I leave L. alone, for obvious reasons.  But I could not resist the urge to remonstrate against so egregious a misunderstanding of simple economic and financial matters.  L. seems like a fan of mid-level bourgeois doctrine, so I wonder if this sort of thing is widespread.  I don’t know—I can’t stomach the Times or the Murdochian Wall Street Journal; I am too delicate to gather the offal in evidence.  It’s sort of gaseous to get in a bag anyway.

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By CJ, August 11, 2011 at 8:51 am Link to this comment

And for truly embarrassing, Jamie Dimon yesterday on CNBC, while parked on
Eastwood’s property (Monterey) on a bus tour (?) of Morgan Chase branches,
talking of how Morgan is opening up branches in California, blah, blah, blah…
“America is still the greatest, blah, blah, blah.” “This too will pass, blah, blah…”

It—which he claims “will pass”—never was for Mr. Dimon, recipient of largesse
(whether he wanted it or not, he claimed at the time).

All’s good, per Jamie, as I wondered if Melissa Francis planned to kiss his feet at
some point, so lauded is Dimon at CNBC. (He’s…ahem…a “rock star”???)

Say what? What’s unemployment in California? 12%?, actually 20-25%. Far worse
among blacks and Latinos.

Leaving one to wonder who’s opening accounts at new Morgan branches? Never
mind, not you and not me, who don’t really count in Mr. Dimon’s universe. In
fact, who the hell has an account at ANY Morgan Chase branch?

I presume he then got back aboard the bus to continue raiding like a Viking the
British Isles of old. At no time did Dimon’s (no doubt charming) Cheshire Cat
smile change to a look of the slightest concern for those not so fortunate.

Some will say, “So what? He’s competent, meritricious, and thus deserving.”

See? That’s the problem with more than “some,” who admire the Dimon’s of the
world. They just don’t get that it can only be all for one or for each, that each
for self doesn’t work and never will—not really even for the most fortunate. And that charity, as Orwell noted in Down
and Out in Paris and London, is an effrontery to dignity. (Nevertheless accepted
when no alternative.)

Thanks, but no thanks, just hand over what’s owed, stop exploiting and then
with congratulating yourselves on your hand-outs and hand-me-downs. Which
were never yours to begin with, but ours all along. Especially, if/when you put
such stock in “earning it.” We did, and then—by rule of anti-humanist, elitist
law—you stole it, Mr. Dimon, along with the rest of your ilk, all—especially lately—aided and abetted by con-artists (alas really legislator-makers of law) like Cantor, Ryan, Boehner and a host of others, not least Mr. Clinton’s crew of peons as well.

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By truedigger3, August 11, 2011 at 8:11 am Link to this comment

Re: By Anarcissie, August 10 at 9:32 am


Anarcissie wrote about Lafayette’a post of Ausgust 10 at 9:02 am :
“Sir, you do not understand economics or the financial business.  Idle moralizations about people’s maturity or intelligence is entirely irrelevant and casts doubt on your own possession of these faculties. “
—————————————————————-
Anarcissie,
Lafayette is nothing but a TROLL for the super-rich and Wall St.
He is here to bullshit and justify their dirty deeds and sugar coat it and himself by sophistry and clever obfuscation. He is nothing but a clever bullshit artist.

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By CJ, August 11, 2011 at 8:05 am Link to this comment

Very well said by Robert Scheer, particular re the President as well as S&P, even
if it wasn’t S&P’s downgrade that sent the markets into a “tizzy.” They were
already there, primarily due to Europe’s ongoing sovereign debt problems,
themselves symptomatic of what Ed Herman called capitalist triumphalism, and
that was some decades ago. It’s been going on that long as most know—since
the 70s, even before Reagan came along to profoundly, and I mean
PROFOUNDLY, hypocritically compound problems. What a fraud he was!
(Olbermann’s the only one in mainstream who calls Reagan what he was: “a
lousy President.” And that’s putting it mildly. (I think Ron Reagan would say the
same but for deference toward his father, which is understandable.) Not that
this is about Reagan, except it is in part.

Reagan DID do stuff, however hypocritical, while Obama stands by. Where the
hell is he anyway? Seriously, where is he? He’s seldom on TV anymore.
Wonder why not?

Meanwhile, the Politburo’s Central Committee is being formed along expected
lines. What a gimmick, one intended to avoid all responsibility on the part of
Congress—if such and such isn’t decided upon, then triggers such that no one
is accountable.

Nothing like a pack of lawyers who never so much as underwent Econ 101.
Obama knows nothing of economics, absolutely nothing, along with almost all
member of Congress, while five Justices are corporate shills. This IS the triumph
of capitalism—for now, until internal contradictions finally do it in. We’re
witnessing some of them, including increasing concentration of wealth to the
point of destruction of any viable economy. While rates of profit have been
decreasing over time, as Marx predicted they would. (It’s popular to point out
Marx’s failed predictions, less popular to point his more numerous correct
ones. While media on behalf of the investor/ownership class still invoke Marx’s
name in the same way a churchman invokes the devil’s name. Such is fear of
truth, at least in the former case, and maybe the latter for all the hell I know, so
to speak.)

Not to underestimate “for now,” which is plenty long enough to destroy
countless middle-, working and under-class lives. In Europe too, where
uprising in Britain reminds of one awhile back in LA. This morning, Cameron
going on in the Commons about “criminality.” Yeah, but…as some MP’s reminded,
not least David Miliband, son of the great Ralph Miliband.

Miliband taught—as a socialist, indeed Marxist—that government had to act as
intermediary among economic classes, that indeed government DID perform
that function, and so, he concluded, government could not simply be labeled
upper-class lackey. That amounted to a “vulgar Marxist” estimation.

By now, that nevertheless appears more and more to be the case—government
purely on behalf of ownership. THAT, PM Cameron is criminality! You too
President Obama.

Cameron began with—none of these excuses! (Meaning no bleeding-heart
stuff.) Idiot, as all such claims reduce human existence in mocking fashion.

The assault on the world economy is purely and simply one on 95% of the
world’s have-nots, with governments having abdicated from Miliband’s
humanist standpoint.

Nothing quite so insulting (and nauseating) as listening to reactionaries talk of
“the people,” any people other than those they actually represent: increasingly
concentrated wealth.

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By David J. Cyr, August 11, 2011 at 7:55 am Link to this comment

QUOTE, eric angeles:

For those of us like myself who are too young to have been part of a real Left but are ready for action, where do we start?
___________________

The people who are young today will not have a future worth having if they do not rise up and wage a war — with extreme prejudice — against My Generation (their parents)... and tear down this rotten society.

First, trust no one over the age of 30, and trust no organization.

Read the linked article, then determine what you can do…

Do We Need a Militant Movement to Save the Planet (and Ourselves)?:

Derrick Jensen, Lierre Keith and Aric McBay call for new strategy to stave off environmental catastrophe.

http://www.alternet.org/environment/151918/
do_we_need_a_militant_movement_to_save
_the_planet_(and_ourselves)?page=entire

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By litlpeep, August 11, 2011 at 7:14 am Link to this comment

Well, thank heavens the FED is doing what the Tea Party could not do without them, giving the Wall Street bankers & financiers another two years of free money to further enable those folks to take another two trillion dollars or so from the rest of us, while further shrinking the US economy into ever more destabilizing troubles.

Why, how else would those kleptocrats be enabled to amass enough money to double the two trillion dollars they already have parked in their coffers, refusing to invest in the US economy, money which their policies, bought and paid for with legally stolen public funds, has already paralyzed the general government.

No one needs to worry about any outside groups taking down the whole ship of state; that is being done faster than we can take a sharp inhalation of realization of how simple it is for the very topmost captains of our political economy to do it.

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By Inherit The Wind, August 11, 2011 at 5:23 am Link to this comment

In the spirit of insanity of the bailouts, I suggest we next bail out Apple and MicroSoft.
What, you say? They are sound? Apple’s the most profitable corporation in America?

What’s that got to do with it? I want to back a winner!

(How is this any crazier than what Bush, Obama and Congress did?)

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By Lafayette, August 11, 2011 at 4:34 am Link to this comment

SW: Please, someone tell me that Obama’s inexplicable Nobel Peace Prize was not a million dollar bribe to lash him to the helm of our rotting, sinking ship of state.

It was not a bribe. That comment is preposterous and unfounded. The Nobel Committee, which selects the laureates, bribed Obama for what reason? What was the quid-pro-quo? 

It is such asinine statements that give Internet forums a bad name. The place becomes a “dump” for invective and mendacity.

So why did he accept it? Because he was president-elect and protocol dictated that he do so. He gave the money immediately to charity.

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By SoTexGuy, August 11, 2011 at 4:22 am Link to this comment

That Obama might be timid or weak is the excuse du jour put forward by his dogged supporters.. In the same vein as how die-hard Bush supporters resorted to saying that man was ‘unprepared, in over his head, even maybe a little thick’

In both cases the truth is that they are either incompetent liars or evil schemers (and liars) or both.

For the record the low point in Obama’s presidency (so far as H. Simpson would say) was the assassination of Bin Laden, or the fake assassination of Bin Laden if you don’t believe it actually happened.

Adios!

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By So what, August 11, 2011 at 1:11 am Link to this comment
(Unregistered commenter)

Please, someone tell me that Obama’s inexplicable Nobel Peace Prize was not a million dollar bribe to lash him to the helm of our rotting, sinking ship of state.

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By Samson, August 11, 2011 at 12:57 am Link to this comment

Typical.  When citizens need foreclosure relief, or
jobs stimulus, or extended unemployment benefits,
then we are told we are too broke as a nation to
afford such luxuries.

When the bankers say they need a few more trillion
dollars of our money to save their balance sheets
after one of their ponzi schemes collapses, well,
then there are suddenly trillions of dollars of money
available to give them all they want.  The only
questions asked are how much money do the bankers
need and how fast do they need it.

This is what happens when we keep electing the
candidates backed by bankers and their money.  It was
ridiculous watching the labor unions go door to door
for wall street’s candidate in the last election. And
it will probably happen again.

Want to fix this, stop voting for the candidates that
have lots of money.  The candidate on your side is
the broke candidate who needs a volunteer to come
give them a ride from the airport.

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By christian96, August 11, 2011 at 12:17 am Link to this comment

As we watch angry youths destroy businesses
throughout England perhaps we have forgotten what
happened in Greece in 2008. Angry youths attacked
the Athens courthouse with petrol bombs.  Broken
glass and burned-out wreckage lay in the streets.
The rioting started on December 6th after police
shot and killed 15-year-old Alexandros Grigoropoulos.  But Alexandros’s tragic death was
simply the spark.  The real fuel for the fire
came from Greece’s troubled economy.  High unemployment contributed to pent-up hostilities
which erupted when Alexandros was killed.  Greece
and England.  We much ask ourselves a sobering
question, “Can the same happen in America?”  As
unemployment and under-employment continue to rise
so does the anger and frustrations.  Do Americans
just need a spark to ignite what could be an ugly
scene with Americans killing Americans across the
country?  Only time will tell! It’s ssd our leaders
in Washington are listening to Economists from the
Univ. of Chicago.  They better listen to human
growth and development specialists about the possible consequences rising from angry frustrated
unemployed and under-employed people.

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By samy, August 11, 2011 at 12:17 am Link to this comment
(Unregistered commenter)

All of you readers, ever refered to the Bejamen Franklin decoment concerning not admitting to America some people who if we do,will control the economy and slave the country?

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By Lafayette, August 10, 2011 at 11:48 pm Link to this comment

A LESSON IN CIVIC DUTY

JXR: I should think not.  It boils down to “those who have the power have a right to do harm those who don’t.”  It’s the creed of a bully.  I wonder if its author is as tough as he talks.

Not at all.

You missed the bit about Civic Duty - that is, your responsibility to be informed and participate in the political process.

Americans abandoned that duty long ago—all they wanted was “jobs, jobs, jobs” and they left the “how, how, how” to politicos who gave us peanuts whilst the plutocrats got the gold.

That means we were taken for the fools we were. STOP BLAMING EVERYBODY ELSE UNDER THE SUN! We, the sheeple, are the problem!

Look at our voting record for decades, here. Half of the American voting population could not give a damn about politics - until the shit hits the fan. Then they are all over the blogs with indignation.

Too late, dork. If you had attended to your Civic Duty PERHAPS the politicos would not have pulled their wool over your eyes.

People died for you to have the right to express yourself in an election - and you threw it away into the dirt. You are getting, now, what you deserve ...

POST SCRIPTUM

The sole note of hope in the future of American politics is the fact that the Internet has leaped to its responsibility by giving the sheeple a bull-horn in the political process. It is fine to see all the remonstration in writing.

But, folks, that ain’t good enough. Not even nearly. Get organized. Behind a political party that has concrete objectives that you feel are necessary to reform the nation.

I happen to think those objectives are Progressive in nature. But that is up for you to decide.

MY POINT: About blog catharsis

Believe me, sheeple, what you write here is important input to the journalists who read your comments. So keep it clear, succinct and objective - because the wailing comment (“woe is we”, “gotta get them bastards”) is just forum chaff.

Blog Catharsis is nice, but it never solved a problem as massively complex as the one we have presently.

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By Alan, August 10, 2011 at 10:54 pm Link to this comment
(Unregistered commenter)

Apparently (paradoxically) the modern world is blind to the
simplest realities. We need an FDR, but what we have is
a make-nice-to-nazis president who can neither set a course at sunrise,
nor at sunset.
What we need is: well considered,
targeted national- and world- industrial/social policy.
Put 2 million Americans to work cladding roof tops with solar panels,
that’s an obvious example.

Nebulous, undirected monetary policy does not help.
Focused, clear, targeted, forward looking national and international
industrial/social policy will help.

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By rumblingspire, August 10, 2011 at 8:50 pm Link to this comment
(Unregistered commenter)

the market is supported by the consumer.  the consumer has been mollified.

at this point in the history of free enterprise the only solution available to a people wanting to recapture freedom is to radically alter their lives. 

never accept wage slavery for that is the lazy way to a vocation.  Consider Really working for a living.

stop making purchases from wage slavers.

“you’ll be absolutely free, only if you want be.”  zappa

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By eric angeles, August 10, 2011 at 6:53 pm Link to this comment
(Unregistered commenter)

Bob, I admire the work you do with this site and
listen to you every week on LR&C. Incisive critiques
of Obama have become widespread, especially lately.
The piece in the NYT Magazine over the weekend was
devastating. Influential journalists like yourself
need to shift the conversation now—what should the
strategy be for the left? For those of us like myself
who are too young to have been part of a real Left
but are ready for action, where do we start? Get this
conversation started, please!

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By igloo, August 10, 2011 at 6:15 pm Link to this comment
(Unregistered commenter)

After the collapse of money based economy fascism will follow.  You are already seeing it in European countries where right wing parties are on the rise. It won’t take much for the neocons to slip on their jackboots when their interests are threatened.

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By ekrasnow, August 10, 2011 at 5:44 pm Link to this comment
(Unregistered commenter)

Better than Bob’s. . . .

Posted on Aug 4, 2011
Tony the Misfit (CC-BY)
By David Sirota
Barack Obama is a lot of things—eloquent,
dissembling, conniving, intelligent and above all,
calm. But one thing he is not is weak.
This basic truth is belied by the meager Obama
criticism you occasionally hear from liberal pundits
and activists. They usually stipulate that the
president genuinely wants to enact the progressive
agenda he campaigned on, but they gently reprimand
him for failing to muster the necessary personal
mettle to achieve that goal. In this mythology, he is
“President Pushover,” as New York Times columnist
Paul Krugman recently labeled him.
This storyline is a logical fallacy. Most agree that
today’s imperial presidency almost singularly
determines the course of national politics.
Additionally, most agree that Obama is a brilliant,
Harvard-trained lawyer who understands how to wield
political power.
Considering this, and further considering Obama’s
early congressional majorities, it is silly to insist
that the national political events during Obama’s
term represent a lack of presidential strength or
will. And it’s more than just silly—it’s a
narcissistic form of wishful thinking coming
primarily from liberals who desperately want to
believe “their” president is with them.
Such apologism, of course, allows liberals to avoid
the more painful truth that Obama is one of America’s
strongest presidents ever and is achieving exactly
what he wants.
Obama is not a flaccid Jimmy Carter, as some of his
critics insist. He is instead a Franklin Delano
Roosevelt—but a Bizarro FDR. He has mustered the
legislative strength of his New Deal predecessor, but
he has channeled that strength into propping up the
very forces of “organized money” that FDR once
challenged.
On health care, for instance, Obama passed a Heritage
Foundation-inspired bailout of the private health
insurance industry, all while undermining other more
progressive proposals. On foreign policy, he
escalated old wars and initiated new ones. On civil
liberties, he not only continued the Patriot Act and
indefinite detention of terrorism suspects but also
claimed the right to assassinate American citizens
without charge.
On financial issues, he fought off every serious
proposal to re-regulate banks following the economic
meltdown; he preserved ongoing bank bailouts; and he
resisted pressure to prosecute Wall Street thieves.
On fiscal matters, after extending the Bush tax cuts
at a time of massive deficits, he has used the debt
ceiling negotiations to set the stage for potentially
massive cuts to Social Security and Medicare—cuts
that would be far bigger than any of his proposed
revenue increases.
As hideous and destructive as it is, this record is
anything but weak. It is, on the contrary,
demonstrable proof of Obama’s impressive political
muscle, especially because polls show he has achieved
these goals despite the large majority of Americans
who oppose them.
Importantly, though, Obama himself has not suffered
from equally negative polling numbers. While his
approval rating is not terrific, he is in decent
shape for re-election—and, more significantly, he has
suffered only a minimal erosion of Democratic
support. He is relatively popular, in other words,
despite advocating wildly unpopular policies. Thanks
to that reality, every one of his stunning
legislative triumphs now has the previously
unprecedented imprimatur of rank-and-file Democratic
support.
In forging such bipartisan complicity with what were
once exclusively right-wing Republican objectives,
Obama has achieved even more than what he fantasized
about when he famously celebrated a previous Bizarro
FDR. In a 2008 interview with a Nevada newspaper,
Obama lauded Ronald Reagan for “chang[ing] the
trajectory of America” and “put[ting] us on a
fundamentally different path.”

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By Angel Gabriel, August 10, 2011 at 4:38 pm Link to this comment

Hey there “passing more wind” you appear to be on the wrong article what’s up
with that? Distraction motivation??

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By Not One More!, August 10, 2011 at 2:54 pm Link to this comment

We live in a corrupted country that is run by corrupted individuals who head corrupted organizations (like our government, corporations etc) while mainstream media provides the cover, and still the masses keep voting for the same. It defies logic.

If Mr. Scheer was truly concerned about the change and reform he keeps talking about, then he would certainly withdraw his support from the democratic party, immediately. And then explain why he supported them up to this point.

You can’t ask for forgiveness if you haven’t owned up to your mistakes. Unless of course, it wasn’t a mistake in the first place.

These policies aren’t done by mistake. They are done intentionally, with awareness of the consequences. And like any good salesmen, they don’t say exactly what they are doing (can’t let the cat out of the too early), so they lie about what they are doing, they lie about why they are doing it, and they are lying about what will happen when they do it.

Stop throwing your vote away by voting for the lesser of two evils. Make a stand, while you still can.

http://www.NotOneMore.US  - Take the Pledge for Peace and Justice

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By Marian Griffith, August 10, 2011 at 2:32 pm Link to this comment
(Unregistered commenter)

@Robert Scheer

It stinks, doesn’t it?
At least now you know how the people Greece feel (and the people of Ireland, and Portugal (who got their credit rating lowered without anybody complaining for economic figures similar or slightly better than the USA), and Italy and Spain feel when those credit rating agencies told them how they “should run their economy or else…”

Or is it only a violation of sovereigncy when they dare challenge the absolute rule of the USA?

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By frank1569, August 10, 2011 at 2:13 pm Link to this comment
(Unregistered commenter)

Here’s the real situation.

Capitalism worked - the majority have a ‘car in every driveway, and a chicken in every pot.’ Not to mention tons of crap. In other words, the reason why ‘consumer demand’ continues to decline is because We The Consumers are materialistically sated, if not obese.

Meanwhile, thanks to ‘globalization’ and technology, maintaining our ‘way of life’ simply doesn’t require the skills, abilities and talents 25 million jobless Americans have to offer. (There are only 3.1 job openings in the US today.)

The goal of Capitalism was to deliver the ‘easy life’ to the masses, where we all had tons of stuff and robots (and ‘others’) did most of the hard labor. Well - we did it. We got the easy life.

Now what?

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By Lafayette, August 10, 2011 at 2:03 pm Link to this comment

AL: when Dylan Ratigan had a public meltdown, one of his guests asked, “How do we do this (fix the problem)?”

It’ll fix itself, just taking longer because of the Crazies in Congress and their buffoonery over the Debt Ceiling.

See how costly it can be to miss a midterm election out of disgust because an intractable problem (recession caused unemployment) was not solved with a snap of the fingers? Who elected these twerps into power?

We, the sheeple - by staying away from the mid-term elections. Have we learned anything? Or will we all get worked into a lather when it happens again next time?

We have to grow up quickly ... or this country becomes a Banana Republic. Next year is the first step in a long journey towards reformation.

Or maybe its the last step as we trip into hell ...

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By Inherit The Wind, August 10, 2011 at 1:35 pm Link to this comment

Michelle Bachmann is applying for bail-out moneys left, right and center for HER district, two alone from the EPA, which she wants to eliminate.

Is there no limit to this woman’s greed and hypocrisy?

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By Jorge X Rodriguez, August 10, 2011 at 12:33 pm Link to this comment
(Unregistered commenter)

“faith, August 10 at 9:21 am Link to this comment

Lafayette,
“A people who do not have the intelligence to understand the world around them
deserve to get shafted.”

While I agree with other parts of your commentary, I don’t agree with the above
statement.”

I should think not.  It boils down to “those who have the power have a right to do harm those who don’t.”  It’s the creed of a bully.  I wonder if its author is as tough as he talks.

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By Alan Lunn, August 10, 2011 at 11:18 am Link to this comment

Can anyone say “wealth transfer,”“government
takeover,” and “privatization?”

Yesterday, when Dylan Ratigan had a public meltdown,
one of his guests asked, “How do we do this (fix the
problem)?”

Dylan suggested that to start the president would
have to tell the world, we have a “bought
government.” Then, like Teddy Roosevelt, he would
have to proceed to face them down. Never mind that
this is a Herculean task.

Besides, Teddy Roosevelt didn’t fix it. A couple of
decades later, three Republican, supply-side
administrations brought us into the Great Depression
while many of the richest made out like bandits. Deja
vu.

We would have to have a massive populist movement to
fix this: one that dwarfs the so-called tea party.
The problem is: How many actually understand this
enough to be motivated? Or where will that leader or
leaders emerge from that would be able to galvanize
such a movement? Otherwise, we wait until a repeat of
the ‘30s before the masses understand what really
happened to them and before tea partiers realize they
basically shot themselves in the foot. Then what? A
revolution? The time for a populist movement is now.

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By ron hansing, August 10, 2011 at 11:15 am Link to this comment
(Unregistered commenter)

I support the downgrade. About time. No, the USA does not deserve a AAA rating… It is a mistake to believe that everybody is dumping into AA+ bonds means that it should be AAA.

The reason is the US treasuries are the most liquid in the world. The reality is that there is not enough of, lets say AAA Slovenia bonds on the market to satisfied the demand. So, we buy where the money is… AA+ US bonds.

I think the S&P got it right this time. Just because they missed horribly in the past does not mean that today the decision was wrong.

The reality is that our debt will continue to increase… That’s the reason for the downgrade.

Not the teaparty… That’s shooting the messenger. In fact half of the tea party voted to passed the congressional bill. So, are you telling me that 20 some teaparty members have that much power over the 500 congress persons? Hardly.

Actually, the tea party was the only group that got it right. The reality is that increase revenue from the rich mantra, is a joke. We need significant increase in revenue… and the meat and potatoes of increased revenue is the middle class.

So, if they think that the middle class will be untouched. That is a distortion. Not true.

If you manage to continue reading, I support the 1993 Canada Plan. Their debt was at 70% GDP and for every seven dollars in cuts, there was one dollar in taxes,,, across the board.

This was not done by the tea party conservative, but by the liberal party. What happened, jobs increased, and now for the first time in my 69 years, the Canadian dollar is worth 10cents more than the American dollar.

Well, I don’t know if I’m right…it’s my opinion, but I do know one thing… We’ll know the answer in five years. I predict, my opinion, that nothing meaningful will happen regarding cuts, and in five years, we will be ten times worse off.

ron hansing 8.10.11

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By CrazyCanuck, August 10, 2011 at 10:32 am Link to this comment
(Unregistered commenter)

30 years of conservative nonsense ( yes, I’m including Bill Clinton ) is what has lead to this, the BIG MELTDOWN.  I wish I could say there’s a way out, but I don’t believe that’s true.  All of the western countries have relinquished their democracies,traded them in for lies and illusions.  It’s going to be a tough fight to repair the damage done by 30 years of deregulation and “laissez-faire” economics, and things really ARE going to get worse before they get better.  The first step has to be to reclaim the LANGUAGE that will enable our society to move ahead.  Until that’s done, we will just continue the downward spiral.

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By Lafayette, August 10, 2011 at 9:53 am Link to this comment

A CIVIC DUTY

Faith: The world is filled with simple people.  American leadership/Wall St./et al, tend to obfuscate the truth and speak in terms that are not clear.  Our courts do the same thing, for the most part.

That is simply not so. There is plenty of public discourse - our country has tons of it. Most people intentionally discard political commentary as uninteresting or boring. We probably think, as a nation, that the Rose Bowl is a more important event than a mid-term election.

Until the shit hits the fan whereupon we start bleating like wounded mutton.

Civic duty is the responsibility to keep aware of matters that should concern us politically. One need not become a policy-wonk, but one should be aware of the world of politics - meaning what happens and why.

It doesn’t matter, really, whether one is Right or Left or Center. The diversity of opinion helps enormously in formulating our own.

What matters is that we make our opinions known, debate/defend them and then vote them. That we try to avoid swallowing the political nostrums that are thrown at us by the media - and particularly the most nauseating of Fox News.

That responsibility is called Civic Duty - and it is 24/24 & 7/7 - not just when something upsets us like today’s present economy. In fact, had we been more discerning in the past it is entirely possible that we would not be in Deep Doodoo today.

We elected Reagan The Huckster, twice. We elected Dubya The Inept, twice. That makes for 16 years of hapless government out of the past 30 since Ronnie got into the White House.

And it happened right underneath our noses. So, the indignation ... no, thank you. It’s superfluous.

”We have met the enemy and he is us” Pogo by Walt Kelly.

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By Anarcissie, August 10, 2011 at 9:32 am Link to this comment

Lafayette, August 10 at 9:02:

‘An: “Well, only the U.S. government could do stuff like hold the interest rates several percentage points under their natural level, thereby causing enormous bubbles in the stock market, real estate, and so on.”

You’re blaming the FRB for offering you cheap interest-rates that you could not resist?

Grow up!

A people who do not have the intelligence to understand the world around them deserve to get shafted. ...’

Sir, you do not understand economics or the financial business.  Idle moralizations about people’s maturity or intelligence is entirely irrelevant and casts doubt on your own possession of these faculties.

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By faith, August 10, 2011 at 9:21 am Link to this comment

Lafayette,
“A people who do not have the intelligence to understand the world around them
deserve to get shafted.”

While I agree with other parts of your commentary, I don’t agree with the above
statement.  The world is filled with simple people.  American leadership/Wall St./et
al, tend to obfuscate the truth and speak in terms that are not clear.  Our courts
do the same thing, for the most part.  Instead of opining that simple folk deserve
the shaft, please continue your other arguments and assertions.  I always enjoy
your comments.  They are well considered, logical, and clear in language.  But, not
the occasional cynical parts, sir.  The american public needs to understand what is
happening and what the consequences are.  They do not.  That is why so many are
losing their homes.

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By felicity, August 10, 2011 at 9:15 am Link to this comment

I’m afraid America was a day-late-and-a-dollar-short
in applying Keynesian economics - which may mean we
should think about whether they’re really viable at
this point.

Keynes advised that when a business cycle peaks and
starts its downward slide, one must increase federal
spending (and cut taxes and lower short-term interest
rates) to increase the money supply and expand
credit.  The demand stimulated by deficit spending
and cheap money will thus prevent a recession.

Of course, we are now trying to prevent a recession
when we’re already in one.

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By faith, August 10, 2011 at 9:10 am Link to this comment

“Excellent, excellent article Mr. Scheer. As usual, I think this article of yours should
be plastered on every single newspaper in America and provided as video in all
media sources. You explain things so well and in terms that the general public can
understand . Maybe you and Matt Taibbi should go on a national tour- it really
might facilitate the understand ing and the voting for the forthcomin g election
cycle in 2012. America needs some serious help. Thank you, sir for a great
article.”  (my same post on HuffPo)

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By Geo Washington, August 10, 2011 at 9:07 am Link to this comment
(Unregistered commenter)

One: put the brakes on all wars
Two: See one.
Three: Stop all selling of treasury bonds to the Banksters.
Four: Issue our own “fiat” money without any debt, like China and call them United States Notes. Have all Federal Reserve Notes turned in for US Notes. Buy back all Treasuries with United States Notes, they have not interest.

Pass a constitution amendment that all law passed by congress must contain only one subject.

It is a start.

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By Lafayette, August 10, 2011 at 9:02 am Link to this comment

HUBRIS

An: Well, only the U.S. government could do stuff like hold the interest rates several percentage points under their natural level, thereby causing enormous bubbles in the stock market, real estate, and so on.

You’re blaming the FRB for offering you cheap interest-rates that you could not resist?

Grow up!

A people who do not have the intelligence to understand the world around them deserve to get shafted. Which is what usually happens, especially when one thinks materialistically - that keeping up with the Jones’ is the Number 1 imperative of life as we know it on earth.

We, the sheeple, believed the Reaganite bullshit and swallowed it hook, line and sinker when he came to office. How could such a handsome smooth talker be wrong?

Easy. He was shilling for the people who gave him the money to become PotUS. And for as long as we do not attend to this facility of corruption, we cannot have a democracy of fairness and equity. The power (of money) corrupts - so absolute power corrupts absolutely. (Lord Acton paraphrased.)

Worse yet, there was a precedence (The Great Depression) but no one thought “that can happen to us!” Why hot? We are spared by means of Divine Intervention?

The Greeks have a word for this all too human attribute. Called “hubris”. (hubris = excessive pride or self-confidence.)

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By David J. Cyr, August 10, 2011 at 8:24 am Link to this comment

Elections have consequences, especially when 99% of the voters routinely demonstrate that they have neither the intelligence nor will to ever use them for good purposes.

The “Principles” of Liberal Voters:

http://chenangogreens.org/home/index.php?
option=com_content&task=view&id=491&Itemid=1

The Devolution of Liberalism:

http://chenangogreens.org/home/index.php?
option=com_content&task=view&id=496&Itemid=1

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By PRGP, August 10, 2011 at 8:13 am Link to this comment

Many seem to blame the middle class.  However, the ongoing greed of the moneyed interests that have kept middle class incomes low and increases non-existent are to blame.  The oligarchs bear the full brunt of responsiblity for this debacle along with the international bankers, brokers, paper pushers (hedge funds anyone?)who create their own wealth through deceit and manipulation while destroying a true economy of real goods and decent employment.  Paybacks will be hell for the moneyed class when it hits the fan.  Hope the walls around your gated communities are high and you have sustainable food supplies within.  Time’s running out for the “royalty”.

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By Anarcissie, August 10, 2011 at 7:52 am Link to this comment

Lafayette, August 10 at 5:07 am:

  An: The U.S. has been living on the tab for many, many years, at the behest of its mostly inept ruling class.

Preposterous. We built the debt up all by ourselves, each and every one of us by employing cheap credit and living way beyond our means.  ...

Well, only the U.S. government could do stuff like hold the interest rates several percentage points under their natural level, thereby causing enormous bubbles in the stock market, real estate, and so on.  Or print money, and give huge, huge bundles to bankers and brokers.  Or venture forth on innumerable useless wars.  But in a sense you’re right.  We don’t need the ruling class; we can be wastrels very well on our own.  So we should fire the ruling class, or at least stop worshiping them and giving them our money.

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By TDoff, August 10, 2011 at 7:15 am Link to this comment

Ain’t it wonderful that ‘...we’ve always been and always will be a AAA country’?

Too bad, and How Come, we don’t have a AAA president? Or a AAA Congress? Or a AAA .........?

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By thom delahunt, August 10, 2011 at 7:10 am Link to this comment
(Unregistered commenter)

if money is going to be handed out why don’t they give to main street in the form of funds to rebuild infrastructure?

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By MaxShields, August 10, 2011 at 7:04 am Link to this comment

We are on a leaky ship of wealth extraction. The holes are many too plug, but plug we must. Endless war and the corporate military industrial complex need to be the first to go.

The problem all of our institutions - primarily the political one - are corrupt. We have an energy and climate disaster on the horizon and coming fast. These will negatively complement the economic catastrophe upon us now. There is no exit except a total reset. The shambles (as Mr. Scheer describes it) cannot be tweaked back into “repair”. We are not in lost in the woods just needing a path out, but in a galaxy we know little to nothing about…

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By m@earth, August 10, 2011 at 6:40 am Link to this comment
(Unregistered commenter)

More so.  How dare bunglers nail it out of the park when they get it right.
I fear though that our national response will be to get the solution part
completely wrong and hand over even more power and control to the wrong
people.    Until we stop rewarding our bullies for their bad behavior with the
eraser and the rule book, nothing will change.

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By prisnersdilema, August 10, 2011 at 5:51 am Link to this comment

The truth is not a moving target…the wars in Afghanistan, Iraq, Pakistan…have been
expensive…So, too have been the tax cuts, the export of whole industries iover
seas..Then there is also the deregulation of the banking Industry, and elimination of
Glass Stiegal….The destruction of America by the corporations and the wealthy in this
country, are well documented, by any number of works, my favorite being Matt Tabbi’s
GRIFTOPIA. The right wing, Namely the Republican party, as the protector, and tool of
the plutocracy, is responsible. Their non stop lies, and greed, have destroyed this
country, and they continue to try to lie their way out of things. It’s not going to work, lies
will not restore this economy, neither will prayer, magic spells, or xeroxing hundred
dollar bills. There is only one way..Restore the rule of law, to Wall Street and the banks.
Penalize those corporations that take jobs out of this country instead of rewarding them.
And make corporate Leaders responsible for their crimes. In China they execute them
when they kill someone, we should do the same here.

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By Lafayette, August 10, 2011 at 5:07 am Link to this comment

An: The U.S. has been living on the tab for many, many years, at the behest of its mostly inept ruling class.

Preposterous. We built the debt up all by ourselves, each and every one of us by employing cheap credit and living way beyond our means.

The rich get richer, yes, but don’t blame them for OUR stupid faults. Blame them from profiting from our excesses, but we did it all by ourselves.

Nobody was forcing your arm. And if it happens again, we are likely all to fall into the same trap. Because we have learned nothing.

“A sucker is born every minute.” Given America’s birth-rate per minute, I figure PT Barnum underestimated the number greatly.

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By Lafayette, August 10, 2011 at 4:55 am Link to this comment

THE DIFFERENCE BETWEEN BLAME AND RESPONSIBILITY

RS: The result is that Obama has agreed to effectively remove the elected federal government from the battle to restore economic health and instead left us to the tender mercies of the banker-dominated Federal Reserve, which, like the folks at S&P, condoned the reckless Wall Street policies that got us into this mess. At a time when we need a full-throated defense of the role of government in protecting the interests of a majority of Americans ...

On-the-ball article, RS. Until it goes wild, that is.

You cannot blame both the T-party (as well as the rest of the Rabid-Right) AND Obama for all the ills that befall us. The above statement is a non-sequitur.

Obama had no command of the the debate because the HofR must issue all money-bills. And Boehner would not even control the T-party Crazies. So, in a way they are both responsible for the dysfunction - but only one party is truly blamable.

Our Political Governance is dysfunctional. Period.

MY POINT

So, think of this: The fact that all money-bills must issue from the HoR and then be approved by the Senate is not established in the Constitution. It was a procedure adopted by Congress to assure that both Chambers did not go off in different directions. So, first the House, then the Senate votes on the bill - supposedly separated time-wise by a period of inter-Chamber deliberations.

We can change that by giving the PotUS whatever power he wants in managing Fiscal Policy. This gives the presidency real power to spend as it sees fit. But, the presidency can get carried away - as did this last one (that we voted for twice!)

Or, we can leave it as it is - and in the future presidents will understand that they have to get started on Debt Ceiling legislation long beforehand because it will never again be automatic. I figure even the Dems now understand what can happen if they stonewall.

VOX POPULI

It would help enormously if we made this upcoming election year one with Clear Debates about what this country needs to reform itself. With both sides hopefully proposing different policies.

And we, the sheeple decide. Why are we not debating the fundamentals during election periods - after all, they happen more frequently in our country than any other. As well they should.

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By Anarcissie, August 10, 2011 at 4:32 am Link to this comment

The U.S. has been living on the tab for many, many years, at the behest of its mostly inept ruling class.  Now the bill is coming due, and I don’t think the quarrel about who is responsible for the failure of the most recent evasions is going to be worth the hot air to inflate it.  Yes, the government could print more money.  But since people are losing faith in the money….

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By blogdog, August 10, 2011 at 1:25 am Link to this comment

• decommission the Fed. as a private bank

• commission a new US Gov. Bank as a transparent public institution

• charge it with financing the recovery

• 0% loans to refinance homes, schools, hospitals, cultural endeavors and
productive businesses, employing US workers that actually make something

• give Wall Street’s leeches a 1% Tobin Tax (sales tax on all transactions in
stocks and bonds)

• force settlement of all derivative paper and make illegal all future derivatives

• no more free money to investment banks

• shrink the military to a national defense force

• force the MIC into new peaceful high tech or starve them to death

that’s what the recovery calls for and anyone trying it will die immediately of no
natural cause

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