Jumper
South Carolina
In 1969, the U.S. Supreme Court upheld the right of the Federal Communications Commission (FCC) to enforce the Fairness Doctrine.
Reagan appointed FCC Chairman, Mark Fowler, abolished the Fairness Doctrine in 1987. Congress tried to protect the Fairness Doctrine before Fowler's abolishment but it was vetoed by Ronald Reagan. Congress tried to re-instate it in 1991. Bush I threatened to veto it.
In 2000, the Personal Attack rule and the Political Editorial rule were abolished by the FCC - again - under Republican administration.
Two attempts were made re-instate the Fairness Doctrine in 2005, when Republicans held control. In both cases, under Republican Majority control, it was referred to committee and died.
Starting in 2008, several Democratic Senators and U.S. Representatives
have encouraged the FCC to reinstate the Fairness Doctrine - to no avail.
Former President Bill Clinton has stated support for the reinstatement.
In 2009 an interview during Februray, he stated, "Well, you either ought to have the Fairness Doctrine or we ought to have more balance on the other side, because essentially there's always been a lot of big money to support the right wing talk shows."
In "Broadcasting and Cable," in 2009, Bill Clinton cited, "...blatant drumbeat" against the stimulus program from conservative talk radio, saying it doesn't reflect economic reality.
Why hasn't the FCC reinstated the Fairness Doctrine under the Obama administration? The FCC abolished it and can reinstate it. The current Chairman, Julius Genachowski has a background that gives him insight to why this is necessary. Congressman Clyburn's daughter is a FCC commissioner. Certainly they together know the damage that's being done by the big money interests heavily funding the apparatus to spread the big-money lies ... with no effective response.
An effective, representative Democracy cannot be sustained with a public intentionally kept ignorant. That's what's happened since the big money interests have dominated the media with no requirement to present a balanced view.
Perhaps one problem can be seen in the Democratic leadership. In late 2008, now Senate Majority whip, Democrat Dick Durbin, said he felt this is all blown out of proportion.
President Obama, then a Senator, in June, 2008, said, through his press secretary, that he, "Does not support reimposing the Fairness Doctrine on broadcasters ... he considers the debate to be a distraction from the conversation we should be having about opening the airwaves to as many diverse viewpoints as possible ..."
The AP has reported that as President, President Obama had no intention of reimposing the doctrine.
The current House bill, HR 226, Broadcaster Freedom Act of 2009, was written to block reinstatement of the Fairness Doctrine. The U.S. Senate added blocking the Fairness Doctrine as an amendment to The District of Columbia House Voting Rights Act of 2009, by a vote of 87-11. It is on permanent hold because of other issues.
The AP stated the House bill 226 was, "... In part a response to conservative radio talk show hosts who feared Democrats would try to revive the policy to ensure liberal opinions got equal time..."
The Wall Street Journal and The Washington Times have opposed the Doctrine's revival. They contended Democrats only wanted it back because of the success of conservative talk radio.
Bush II FCC commissioners, raised the straw man distraction of stating that the Fairness Doctrine could be extended to the Internet and Cable. Gosh, guess it didn't occur to them to write legislation exempting Internet bloggers.
It should be extended to cable. The mistake President Obama made as a senator was to think that because diverse sources existed Americans would seek out opposing points to view to make themselves well-informed. How many Americans couldn't name the current Vice-President?
The reality is that in political commentary, the attack and counter-attack must be presented side-by-side or only one side ever gets heard - as we see with Murdoch's endless stream of paid liars.
If the Fairness Doctrine was not a concern to the big-money conservatives that their propaganda and lies would be exposed, they wouldn't be attacking it's reinstatement.
The Fairness Doctrine served the U.S. well from 1949 through 1987. Again, a representative democracy cannot work if only lies, untruths and the propaganda of the ultra-wealthy is the only information filling voters' heads.
____________________________
"The Fairness Doctrine had two basic elements: It required broadcasters to devote some of their airtime to discussing controversial matters of public interest, and to air contrasting views regarding those matters. Stations were given wide latitude as to how to provide contrasting views: It could be done through news segments, public affairs shows, or editorials. The doctrine did not require equal time for opposing views but required that contrasting viewpoints be presented."
4.10.10
3.10.10
KRUGMAN - Levin Bill - CHINA
duduong
CT, USA
Mr. Krugman's arguments are standard Keynesian and consistent with the mainstream US economic doctrines since the 60's, when the US became a deficit nation. But if we go a little further back to the mid 40's, when the US was THE surplus nation of the world, what was the US' position on this issue? During the Bretton Woods negotiation, the chief representative of the UK (the major deficit nation of the day) was none other than Mr. Keynes himself. His main proposals are 1) to set up a new global currency supervised by an independent world central bank and 2) to have a pre-set mechanism for currencies of surplus nations appreciate and those of deficit nations depreciate. The US' response was NO and NO! This happened at the height of WWII, so guess which side prevailed. Dollar became the global reserve currency, and all others were pegged to it for the next three decades, until Nixon unilaterally trashed Bretton Woods. More precisely, he trashed the second part, which prevented the US from printing unlimited amount of money as its deficits got worse. The dollar remains the global reserve currency, however.
Now, however evil the Chinese de facto peg to the dollar is nowadays, it is only so to half the degree as the US was under FDR (coincidentally one of Mr. Krugman's heroes) because China is at least not forcing the rest of the world to accept Yuan as the reserve currency.
Now, dollar remains the global reserve currency and the Fed gets to print and has indeed been printing unlimited amount of it. Chinese labor and products get traded for this worthless piece of IOU and, guess what, there is no real global currency for the Chinese to convert it to, thanks to the foresight of FDR. Two plus trillions of them have to be put back into treasuries and wait for the eventual depreciation. Believe it or not, the evil Chinese, instead of accepting this depreciation, actually have the temerity to emulate the US and print a large amount of their own money in a futile attempt to delay the day of reckoning. This is the true crime of China. All the talks about jobs are just smoke and mirrors because however much the Yuan appreciate, the overall US trade deficits will not drop. They will simply shift to cheaper countries like India, Pakistan, Indonesia, Vietnam, you name it.
Although there is a real offense made by China, the urgency to dwell on the issue now comes from other considerations, notably the easy scapegoating by Obama administration about the deficits before the election and the geopolitical benefit of weakening China while strengthening its neighbors. The Chinese leadership knows this, so I doubt that they will welcome the American liberators with flowers as Mr. Krugman claims. If the US persists in this attempt, a trade war is not far off.
HandMadeinUS
Florida
Lesson learned here. Americans earn 4 times the wages than Chinese workers and Americans are unemployed because of it. No magic tricks, jawboning or diplomacy will change that, and China will continue to bank money every year, America will continue to lose jobs and run deficits.
I am a 6th generation American working for a Chinese company, calling on USA businesses nationwide. American companies cannot compete with pricing on my products, my customers want the cheapest prices, no matter my products are Chinese made. My company also receives alot of investment and grants from the Chinese government for marketing and R&D. In effect, I work for the Chinese government.
The real problem,(wage disparity),will continue to haunt this country for many years, until the imbalance corrects. So, America needs to quit China bashing and whining, and be real Americans and work hard. Do like the Chinese now do. Lace up your shoes, keep your head down and go to work everyday developing new ideas and products. Crying that our problems are created by others, will doom us for sure.
Tom Renda
Washington
Samuleson made a similar argument on Monday in the Washington Post. There, he noted that China's share of worldwide exports has risen from 6% in 2006 to 10% in 2010.
Well, inasmuch as China has a third of the world's population, what principled reason is there why its share of exports (and hence share of jobs) should not rise to 33%?
If our answer to that question is nothing more than "because it hurts us" then I would not expect much sympathy from the Chinese anytime soon.
schrodinger
Northern California
Rather than a trade war we should be thinking about a glacier. Slowly, surely, over a period of 3 to 5 years, we should erode China's trade surplus with ever increasing tariffs. The tariffs should not favor specific industries, but should be be broad based and applied to everything made in China.
We should ignore Chinese retaliation against US exports. We can always balance our trade at zero, and we should make that quite clear to the Chinese.
Katy H
UK
I once visited Cheyenne and being in a touristy mood, loaded up on western wear at a local outfitter. imagine my surprise when I got it all home and all of it, every ranch shirt, every longhorn belt buckle I proposed to gift as an "American" present, turned out to be made in China.
Currency is one thing but if China gets more expensive, Lee, Wrangler and Levi will simply go to Vietnam, Bangladesh, the Philippines or Morocco.
They won't come back sadly. Is this inevitable though? Spanish company ragtrade co Inditex (Zara) seems to do well on world domination by manufacturing in Spain.
Your problem lies with the mindset of the CEOs of US companies, the domination that their cheap labour is payed in, isn't important. Any respite would be temporary at best.
Anyway. If you want to play chicken, devalue the $ (even more) and China will overheat or be forced to adjust the peg.
John MacCormak
Athens, Georgia
Krugman writes: "...taking on China is one of the few policy options for tackling unemployment available to the Obama administration, given Republican obstructionism on everything else."
Or so it would appear. Washington and Krugman do indeed seem to feel that they are out of chips. Odd that they should see things that way, of course, given that there is plenty of work to do to solve the real problem, the lack of competitiveness of the US economy, itself a consequence of the US turning itself into a financial theme park over the past thirty years, featuring real estate bubbles, stock bubbles, bond bubbles, insurance bubbles, deficit bubbles, credit card bubbles. Why, there's enough variety in this Bubble Trouble theme park to make Walt Disney envious.
What has been exasperating me over the past two years has been the way that politicians and pundits have been making excuses for America's problems. Do they really think people are stupid enough to believe that printing money, borrowing, and fiddling with currencies and interest rates are going to solve our serious economic problems? They won't. In fact, the "show-me-the-money" obsession is a distraction that is making things worse. It also reveals that, far from having learned from the mistake of redefining productive economic activity as a series of fiscal and monetary moves and regulations, officials are intent on continuing down the same path banal path, and pundits like Krugman are in the bleachers cheering - no, egging - them on.
The myriad market irregularities we see today are a consequence, not a cause of the global crisis. And culprit number one for the break down of the markets is the US, which has been promoting inflationary devaluation of its currency since the end of the post-war boom in the 1970s. Industrial activity as a contribution to US GDP has gone from being around 30% to around 15% over the past three decades; during the same period, financial activities have swollen from around 15% to 30%.
Krugman is also disingenuous (and perhaps less polite words could be used to describe his attitude) in brushing off inflation. He himself in a recent column noted with absolute glee that the US was able to erase most of its WWII through inflation. And you don't need a PhD in economics to see that currency debasement is the only way that governments have out their current debt bubble trouble.
Moreover, he ignores the relevant, current, real-world experience of Greece. Months ago Krugman wrote that Greece will inevitably sink into a deflationary hole because it can't (unlike the US - did I hear the phrase "currency manipulation"?) print or devalue its own currency. In the real world, however, Greece is sliding slowly into a deep recession featuring high unemployment, severe slowdowns in commerce and production, and, yes, high inflation. It's hard to see why Krugman thinks there is no inflationary risk. It's so hard to see, in fact, that he probably does see it. He wants inflation as a way of writing off bad debt.
What Krugman doesn't like to say is that currency debasement and other inflationary policies are a destruction of the wealth of creditors, and people on fixed incomes, and a giveaway to debt-holders. But then, he wouldn't want to mention that, would he? But that's capitalism: when you've got a bubble, it means that there is more "wealth" on people's books - in the form of bank deposits, houses, gold, you name it - than society consumes. One way or another, the books will be balanced. The only question is, will money lose its value or assets?
On another level, I also find distasteful, racist, and dangerous Krugman's continued attempts to talk up some Chinese peril. Krugman reproduces in a sanitized form the old American racist stereotypes of the Chinese as inscrutable, devious, cold, and calculating fiends who are selfishly destroying the US economy. The US, on the other hand, is seen as the good guys who just want to pitch in and help "the global economy" recover. The truth is that the US wrote the book on currency manipulation.
Krugman should stop blaming the Chinese and take a look at the man in the mirror.
AJD
New York
It's interesting that this column appears only two days after a very insightful op-ed by Stephen Roach, yet Paul Krugman doesn't even so much as acknowledge the existence of Roach's column, or of the one by two former trade negotiators that appeared several weeks ago.
Both op-eds rather deftly refuted Krugman's constant refrain that a) China manipulates its currency to subsidize its exports; b) This is the direct cause of the loss of America's manufacturing capacity; c) We must level sanctions against China and force it to revalue its currency; d) We must also sink the dollar; and e) Once this happens, it will bring about a renaissance of American manufacturing and an avalanche of new jobs.
We already tried this tactic with Japan and Germany back in 1985 with the Plaza Accord, and what did it get us? To this day, we still run trade deficits with both countries, even though their currencies are now stronger than the dollar! The Washington Post even reported that German companies have been making all kinds of money selling their products to the Chinese, even though at the time, the euro was trading at $1.30 to the dollar!
The Chinese didn't come over here and steal our manufacturing sector; rather, they simply took advantage of our own stupid and shortsighted economic policies, policies whereby the government essentially bent over backwards to encourage companies to increase their profits by shipping manufacturing and, increasingly, R&D to countries with cheaper labor.
A number of economists have countered the dangerous ideas being put forth by people like Krugman and various members of Congress, showing that even a dramatic revaluation of the renminbi would in fact result in little job creation here in the United States. The manufacturers that have moved their factories there would simply move them to cheaper countries like Bangladesh, India and Vietnam.
Another thing is that if we couldn't get goods from China, then where would we get them? We don't have the manufacturing capacity here to make things like flat-screen TVs, iPhones and other products. If they become too expensive, then the companies that make them (including many American companies) and the retailers that sell them will lose money and, in many cases, go out of business or get gobbled up by foreign competitors. How would Krugman like to see Apple acquired by China's Lenovo, hmm? That's why two retailing lobbies -- the Retail Industry Leaders Association and the National Retail Federation -- have both come out against this bill.
If we want to revive manufacturing in this country, then rather than blaming the Chinese for our problems, we should take a cue from the Germans and get into manufacturing value-added goods, high-value goods that sell regardless of currency exchange rates on the basis of their QUALITY, not just their PRICE.
A big reason why have such a huge trade deficit with China is because our products suck, not because they're too expensive.
watchingchina
Shanghai
With appropriate apologies to my American friends who might think I'm hogging this board, I would like to make one final observation.
Does anyone remember Richard Nixon or John Connally? Do Americans recall when Nixon's administration unilaterally took the US off the gold standard?
The end arrived in 1971 when the French Government, fearful of the considerably weakened position of the US dollar and concerned for its currency reserves, demanded to have all its dollars converted into gold - as guaranteed by the system.
Instead, the US defaulted on the Bretton Woods Agreement, and on the fixed currency regime itself, and unilaterally terminated convertibility of dollars to gold. Of course, the entire international currency system collapsed. This US default not only left the rest of the world very angry, but holding huge amounts of US currency that now had no fixed value.
The world's economies now had no choice but to continue to use their dollars as the reserve currency. Everyone who wanted to trade, had to buy US dollars. The result was that the US was able to sell as many bonds and print as many dollars as it wanted - in fact, to be able to inflate itself out of debt and pass the inflationary pain to the rest of the world.
The European countries complained bitterly to the US about their losses and the resulting currency fluctuations they had to deal with. Does anyone recall then Treasury Secretary Connally’s famous statement? “It’s our currency, but it’s YOUR problem.”
That 1971 decision left the US free to inflate their money supply and fuel more credit bubbles, but it plunged the world into a decade of ruinous inflation, reaching 20% or more in many countries and interest rates reaching 25% even in stable countries like Canada. The inflation led to, and was ended only by, the severe worldwide contraction of the early 1980s - when oil fell from US$40 to US$10 a barrel.
The severe recession in the 1980s was a direct result of the US default ten years earlier, and was a necessary consequence for a worldwide realignment of currencies and economies. That recession was very severe in many countries, devastating entire sectors of economies - energy, for one - and created enormous hardships and economic losses.
In Western Canada, the center of that country's petroleum industry, the contraction hit so hard and so quickly that house prices dropped by 50% in only 3 months, and those prices did not recover their 1984 levels until the year 2000.
All of that worldwide inflation, all the worldwide recessionary pain, were from the same root cause - the US overextending itself, excessive liquidity fueled by easy credit, and then passing the pain to the rest of the world. The US has repeatedly and severely damaged the world's economies by its financial irresponsibility. It is usually the same - overextension of credit, living beyond their means, creating and bursting financial bubbles, that has done it.
It’s exactly the same picture today. Don’t blame China or anyone else.
If I may, (and with the kind permission of the editors) here are a few links to articles that may clear up some misconceptions.
http://www.bearcanada.com/fae/ifc/ifc.html
The Structure of the US Economy Today:
On the supply side, 70% of the US economy today is services - banks, insurance and investment, legal, accounting, consulting, and more usual items like tourism and pizza.
A huge part of the US service sector is financial services - in other words, perhaps half of the US economy consists not of production but simply of bookkeeping entries. That's a poor recipe for a healthy economy.
Only about 10% of the US economy is manufacturing, and most of that is arms and weapons, aircraft, autos and machinery, petroleum and food products. There are almost no consumer goods made in the US. Simply put, the US doesn't make anything anymore.
And on the demand side, 70% of the US economy depends on consumer demand - on people shopping and spending money. Only about 20% is from corporate investment.
Some of this consumer demand will be spent on services, but much (or most) will go to consumer goods. So when Americans go to the mall to shop, what will they buy? Stinger missiles? A new Boeing 737? In fact, virtually all the goods in US shops are imported.
China is irrelevant in this picture. If it isn’t China, it will be someone else. If a country no longer manufactures anything, consumption goods must be imported, and that will always result in a huge trade deficit. It cannot be any other way.
The last time the US had a small trade surplus was in 1975, just after it reneged on the Bretton Woods Agreement, destroying the international financial agreements that had persisted since the Second World War.
By that time, the expansion of credit had begun to fuel the new consumer-led economy and the trade deficits began to emerge - and have continued ever since. And these trade deficits are not only with China. During the past 35 years, the US has consistently had trade deficits with more than 60 countries.
Worse, the US economy is fueled to an exaggerated extent by credit. Americans save no money but spend today's money and next year's. Consumer demand is therefore exaggerated and artificial, and the US (both government and consumers) is living beyond its means. It is borrowing from the future to spend today.
In simple terms, the US consistently buys more than it sells. It means that the world, including China, produces many things that the US wants to buy, but the US is consistently producing fewer goods that the rest of the world wants to buy.
This is the source of the trade deficits. It has nothing to do with the value of the Chinese RMB. In the almost 35 intervening years every country's currency has been up and down, often many times, but the US trade deficits (with all countries) have persisted through all of that.
The US cannot increase its exports unless it sells more arms and weapons, or commercial aircraft. It can try to increase exports of services, but that isn't so easy as the Americans thought. You can export some professional services like consulting and insurance, and tourism is a useful export. But you cannot export restaurants and dry cleaning. The scope for US exports is quite limited.
The US Credit Binge
The US economy is fuelled to an excessive extent by credit, especially consumer credit, and the US savings rate has been at zero or negative for quite some time. Americans are spending not only today's money, but also tomorrow's and next year's. Borrowing money for investment can be wise; borrowing for consumption will lead to disaster.
During the recent subprime financial disaster, Americans were using their homes like ATMs. As their houses increased in value, Americans increased the mortgages on those homes - and spent the money. As the values rose again, the process was repeated. Housing prices collapsed, the housing bubble burst, and more than 25% of all Americans owe the bank more money than the value of the house; many owe twice the value of their homes.
One of the fundamental problems with the US economy is that both the government and its population are living beyond their means, borrowing money for consumption, spending tomorrow's money today with little apparent thought of how to repay. With so much of the US economy fueled by credit, the US is not only living beyond its means, but its 'standard of living' is artificially high; my personal guess is 30% too high. This cannot likely be sustained; a major correction is inevitable.
The US wants other countries to adopt their model - stop saving, push consumer spending, overflow with liquidity, use consumer credit to a much greater degree. If this were to happen, the trade deficits might decrease, but Canadians, Japanese and Chinese will not do that.
Since the US is the only country that follows this model, the best solution is that they increase savings, reduce liquidity and consumer credit to dampen demand, and live within their means. But that's not likely to happen because it will mean an economic contraction and significantly reduced living standard.
Fred Li
Taiwan
During the past couple of years, the writings of Professor Krugman often puzzled me. Is this the same Krugman who taught me so much with his earlier books, like, “Peddling Prosperity”? Holding large amount of foreign reserve is a sign of an economy’s inability to utilize her assets, isn’t it? Buying a lot of US treasury bonds is a way of giving a loan to the seller, isn’t it? The borrower can use the loan in different ways, like building green technology, improving the crumbling infrastructure, but should not be used in blowing up a real estate bubble. Right? The loan provider, in this case, cannot dictate to the borrower for what the loan is to be used. Right?
Krugman’s accusation that China restricted foreign investment is ludicrous. China is the destination one of the largest FDI in the world! Is China hurting US employment? One period that had unemployment figures, comparable to today, was during the early 1980’s, before China began to export at all. In subsequent years, China began to export more and more and correspondingly the US boomed! How about jobs? There was a time when New England had a major textile industry that shriveled away. Jobs of those textile workers were taken by foreigners, Japanese first, Asian tigers next, and China following. It was the Japanese who took away US jobs not the Chinese. The jobs are now leaving China for places like Vietnam, Sri Lanka. They will not go back to New England! The irresponsible Wall Street types playing with “financial innovation” caused the financial crisis, which led to the current high unemployment. Wasn’t it? The whole world, including significantly the developing countries, paid for that bit of Anglo-Saxon shenanigan and we are, by and large, out of it by now. The US is not even in recession; the corporations are making record profits but they are just not hiring. One may argue that the US workers are improving on productivity so much that not so many is needed. If you look beyond the US, Germany is booming! Their unemployment rate dropped significantly. Newly rich Asians want to buy BMWs and Porsches, not Ford. Appreciation of the RMB will reduce the trade imbalance! Will it? During 2007 to 2008, RMB did appreciate over 20% and the trade imbalance worsened.
Is the US government too passive in facing up to China? It is true that whatever you think the Obama government doesn’t have many cards to play against China short of going to war. The US is in two wars right now already! It is also true the government can’t do much on anything else either, not on further stimulus, not on immigration, not on renewable energy. It is mired in the quagmire of political polarization of historical proportion!
CT, USA
Mr. Krugman's arguments are standard Keynesian and consistent with the mainstream US economic doctrines since the 60's, when the US became a deficit nation. But if we go a little further back to the mid 40's, when the US was THE surplus nation of the world, what was the US' position on this issue? During the Bretton Woods negotiation, the chief representative of the UK (the major deficit nation of the day) was none other than Mr. Keynes himself. His main proposals are 1) to set up a new global currency supervised by an independent world central bank and 2) to have a pre-set mechanism for currencies of surplus nations appreciate and those of deficit nations depreciate. The US' response was NO and NO! This happened at the height of WWII, so guess which side prevailed. Dollar became the global reserve currency, and all others were pegged to it for the next three decades, until Nixon unilaterally trashed Bretton Woods. More precisely, he trashed the second part, which prevented the US from printing unlimited amount of money as its deficits got worse. The dollar remains the global reserve currency, however.
Now, however evil the Chinese de facto peg to the dollar is nowadays, it is only so to half the degree as the US was under FDR (coincidentally one of Mr. Krugman's heroes) because China is at least not forcing the rest of the world to accept Yuan as the reserve currency.
Now, dollar remains the global reserve currency and the Fed gets to print and has indeed been printing unlimited amount of it. Chinese labor and products get traded for this worthless piece of IOU and, guess what, there is no real global currency for the Chinese to convert it to, thanks to the foresight of FDR. Two plus trillions of them have to be put back into treasuries and wait for the eventual depreciation. Believe it or not, the evil Chinese, instead of accepting this depreciation, actually have the temerity to emulate the US and print a large amount of their own money in a futile attempt to delay the day of reckoning. This is the true crime of China. All the talks about jobs are just smoke and mirrors because however much the Yuan appreciate, the overall US trade deficits will not drop. They will simply shift to cheaper countries like India, Pakistan, Indonesia, Vietnam, you name it.
Although there is a real offense made by China, the urgency to dwell on the issue now comes from other considerations, notably the easy scapegoating by Obama administration about the deficits before the election and the geopolitical benefit of weakening China while strengthening its neighbors. The Chinese leadership knows this, so I doubt that they will welcome the American liberators with flowers as Mr. Krugman claims. If the US persists in this attempt, a trade war is not far off.
HandMadeinUS
Florida
Lesson learned here. Americans earn 4 times the wages than Chinese workers and Americans are unemployed because of it. No magic tricks, jawboning or diplomacy will change that, and China will continue to bank money every year, America will continue to lose jobs and run deficits.
I am a 6th generation American working for a Chinese company, calling on USA businesses nationwide. American companies cannot compete with pricing on my products, my customers want the cheapest prices, no matter my products are Chinese made. My company also receives alot of investment and grants from the Chinese government for marketing and R&D. In effect, I work for the Chinese government.
The real problem,(wage disparity),will continue to haunt this country for many years, until the imbalance corrects. So, America needs to quit China bashing and whining, and be real Americans and work hard. Do like the Chinese now do. Lace up your shoes, keep your head down and go to work everyday developing new ideas and products. Crying that our problems are created by others, will doom us for sure.
Tom Renda
Washington
Samuleson made a similar argument on Monday in the Washington Post. There, he noted that China's share of worldwide exports has risen from 6% in 2006 to 10% in 2010.
Well, inasmuch as China has a third of the world's population, what principled reason is there why its share of exports (and hence share of jobs) should not rise to 33%?
If our answer to that question is nothing more than "because it hurts us" then I would not expect much sympathy from the Chinese anytime soon.
schrodinger
Northern California
Rather than a trade war we should be thinking about a glacier. Slowly, surely, over a period of 3 to 5 years, we should erode China's trade surplus with ever increasing tariffs. The tariffs should not favor specific industries, but should be be broad based and applied to everything made in China.
We should ignore Chinese retaliation against US exports. We can always balance our trade at zero, and we should make that quite clear to the Chinese.
Katy H
UK
I once visited Cheyenne and being in a touristy mood, loaded up on western wear at a local outfitter. imagine my surprise when I got it all home and all of it, every ranch shirt, every longhorn belt buckle I proposed to gift as an "American" present, turned out to be made in China.
Currency is one thing but if China gets more expensive, Lee, Wrangler and Levi will simply go to Vietnam, Bangladesh, the Philippines or Morocco.
They won't come back sadly. Is this inevitable though? Spanish company ragtrade co Inditex (Zara) seems to do well on world domination by manufacturing in Spain.
Your problem lies with the mindset of the CEOs of US companies, the domination that their cheap labour is payed in, isn't important. Any respite would be temporary at best.
Anyway. If you want to play chicken, devalue the $ (even more) and China will overheat or be forced to adjust the peg.
John MacCormak
Athens, Georgia
Krugman writes: "...taking on China is one of the few policy options for tackling unemployment available to the Obama administration, given Republican obstructionism on everything else."
Or so it would appear. Washington and Krugman do indeed seem to feel that they are out of chips. Odd that they should see things that way, of course, given that there is plenty of work to do to solve the real problem, the lack of competitiveness of the US economy, itself a consequence of the US turning itself into a financial theme park over the past thirty years, featuring real estate bubbles, stock bubbles, bond bubbles, insurance bubbles, deficit bubbles, credit card bubbles. Why, there's enough variety in this Bubble Trouble theme park to make Walt Disney envious.
What has been exasperating me over the past two years has been the way that politicians and pundits have been making excuses for America's problems. Do they really think people are stupid enough to believe that printing money, borrowing, and fiddling with currencies and interest rates are going to solve our serious economic problems? They won't. In fact, the "show-me-the-money" obsession is a distraction that is making things worse. It also reveals that, far from having learned from the mistake of redefining productive economic activity as a series of fiscal and monetary moves and regulations, officials are intent on continuing down the same path banal path, and pundits like Krugman are in the bleachers cheering - no, egging - them on.
The myriad market irregularities we see today are a consequence, not a cause of the global crisis. And culprit number one for the break down of the markets is the US, which has been promoting inflationary devaluation of its currency since the end of the post-war boom in the 1970s. Industrial activity as a contribution to US GDP has gone from being around 30% to around 15% over the past three decades; during the same period, financial activities have swollen from around 15% to 30%.
Krugman is also disingenuous (and perhaps less polite words could be used to describe his attitude) in brushing off inflation. He himself in a recent column noted with absolute glee that the US was able to erase most of its WWII through inflation. And you don't need a PhD in economics to see that currency debasement is the only way that governments have out their current debt bubble trouble.
Moreover, he ignores the relevant, current, real-world experience of Greece. Months ago Krugman wrote that Greece will inevitably sink into a deflationary hole because it can't (unlike the US - did I hear the phrase "currency manipulation"?) print or devalue its own currency. In the real world, however, Greece is sliding slowly into a deep recession featuring high unemployment, severe slowdowns in commerce and production, and, yes, high inflation. It's hard to see why Krugman thinks there is no inflationary risk. It's so hard to see, in fact, that he probably does see it. He wants inflation as a way of writing off bad debt.
What Krugman doesn't like to say is that currency debasement and other inflationary policies are a destruction of the wealth of creditors, and people on fixed incomes, and a giveaway to debt-holders. But then, he wouldn't want to mention that, would he? But that's capitalism: when you've got a bubble, it means that there is more "wealth" on people's books - in the form of bank deposits, houses, gold, you name it - than society consumes. One way or another, the books will be balanced. The only question is, will money lose its value or assets?
On another level, I also find distasteful, racist, and dangerous Krugman's continued attempts to talk up some Chinese peril. Krugman reproduces in a sanitized form the old American racist stereotypes of the Chinese as inscrutable, devious, cold, and calculating fiends who are selfishly destroying the US economy. The US, on the other hand, is seen as the good guys who just want to pitch in and help "the global economy" recover. The truth is that the US wrote the book on currency manipulation.
Krugman should stop blaming the Chinese and take a look at the man in the mirror.
AJD
New York
It's interesting that this column appears only two days after a very insightful op-ed by Stephen Roach, yet Paul Krugman doesn't even so much as acknowledge the existence of Roach's column, or of the one by two former trade negotiators that appeared several weeks ago.
Both op-eds rather deftly refuted Krugman's constant refrain that a) China manipulates its currency to subsidize its exports; b) This is the direct cause of the loss of America's manufacturing capacity; c) We must level sanctions against China and force it to revalue its currency; d) We must also sink the dollar; and e) Once this happens, it will bring about a renaissance of American manufacturing and an avalanche of new jobs.
We already tried this tactic with Japan and Germany back in 1985 with the Plaza Accord, and what did it get us? To this day, we still run trade deficits with both countries, even though their currencies are now stronger than the dollar! The Washington Post even reported that German companies have been making all kinds of money selling their products to the Chinese, even though at the time, the euro was trading at $1.30 to the dollar!
The Chinese didn't come over here and steal our manufacturing sector; rather, they simply took advantage of our own stupid and shortsighted economic policies, policies whereby the government essentially bent over backwards to encourage companies to increase their profits by shipping manufacturing and, increasingly, R&D to countries with cheaper labor.
A number of economists have countered the dangerous ideas being put forth by people like Krugman and various members of Congress, showing that even a dramatic revaluation of the renminbi would in fact result in little job creation here in the United States. The manufacturers that have moved their factories there would simply move them to cheaper countries like Bangladesh, India and Vietnam.
Another thing is that if we couldn't get goods from China, then where would we get them? We don't have the manufacturing capacity here to make things like flat-screen TVs, iPhones and other products. If they become too expensive, then the companies that make them (including many American companies) and the retailers that sell them will lose money and, in many cases, go out of business or get gobbled up by foreign competitors. How would Krugman like to see Apple acquired by China's Lenovo, hmm? That's why two retailing lobbies -- the Retail Industry Leaders Association and the National Retail Federation -- have both come out against this bill.
If we want to revive manufacturing in this country, then rather than blaming the Chinese for our problems, we should take a cue from the Germans and get into manufacturing value-added goods, high-value goods that sell regardless of currency exchange rates on the basis of their QUALITY, not just their PRICE.
A big reason why have such a huge trade deficit with China is because our products suck, not because they're too expensive.
watchingchina
Shanghai
With appropriate apologies to my American friends who might think I'm hogging this board, I would like to make one final observation.
Does anyone remember Richard Nixon or John Connally? Do Americans recall when Nixon's administration unilaterally took the US off the gold standard?
The end arrived in 1971 when the French Government, fearful of the considerably weakened position of the US dollar and concerned for its currency reserves, demanded to have all its dollars converted into gold - as guaranteed by the system.
Instead, the US defaulted on the Bretton Woods Agreement, and on the fixed currency regime itself, and unilaterally terminated convertibility of dollars to gold. Of course, the entire international currency system collapsed. This US default not only left the rest of the world very angry, but holding huge amounts of US currency that now had no fixed value.
The world's economies now had no choice but to continue to use their dollars as the reserve currency. Everyone who wanted to trade, had to buy US dollars. The result was that the US was able to sell as many bonds and print as many dollars as it wanted - in fact, to be able to inflate itself out of debt and pass the inflationary pain to the rest of the world.
The European countries complained bitterly to the US about their losses and the resulting currency fluctuations they had to deal with. Does anyone recall then Treasury Secretary Connally’s famous statement? “It’s our currency, but it’s YOUR problem.”
That 1971 decision left the US free to inflate their money supply and fuel more credit bubbles, but it plunged the world into a decade of ruinous inflation, reaching 20% or more in many countries and interest rates reaching 25% even in stable countries like Canada. The inflation led to, and was ended only by, the severe worldwide contraction of the early 1980s - when oil fell from US$40 to US$10 a barrel.
The severe recession in the 1980s was a direct result of the US default ten years earlier, and was a necessary consequence for a worldwide realignment of currencies and economies. That recession was very severe in many countries, devastating entire sectors of economies - energy, for one - and created enormous hardships and economic losses.
In Western Canada, the center of that country's petroleum industry, the contraction hit so hard and so quickly that house prices dropped by 50% in only 3 months, and those prices did not recover their 1984 levels until the year 2000.
All of that worldwide inflation, all the worldwide recessionary pain, were from the same root cause - the US overextending itself, excessive liquidity fueled by easy credit, and then passing the pain to the rest of the world. The US has repeatedly and severely damaged the world's economies by its financial irresponsibility. It is usually the same - overextension of credit, living beyond their means, creating and bursting financial bubbles, that has done it.
It’s exactly the same picture today. Don’t blame China or anyone else.
If I may, (and with the kind permission of the editors) here are a few links to articles that may clear up some misconceptions.
http://www.bearcanada.com/fae/ifc/ifc.html
The Structure of the US Economy Today:
On the supply side, 70% of the US economy today is services - banks, insurance and investment, legal, accounting, consulting, and more usual items like tourism and pizza.
A huge part of the US service sector is financial services - in other words, perhaps half of the US economy consists not of production but simply of bookkeeping entries. That's a poor recipe for a healthy economy.
Only about 10% of the US economy is manufacturing, and most of that is arms and weapons, aircraft, autos and machinery, petroleum and food products. There are almost no consumer goods made in the US. Simply put, the US doesn't make anything anymore.
And on the demand side, 70% of the US economy depends on consumer demand - on people shopping and spending money. Only about 20% is from corporate investment.
Some of this consumer demand will be spent on services, but much (or most) will go to consumer goods. So when Americans go to the mall to shop, what will they buy? Stinger missiles? A new Boeing 737? In fact, virtually all the goods in US shops are imported.
China is irrelevant in this picture. If it isn’t China, it will be someone else. If a country no longer manufactures anything, consumption goods must be imported, and that will always result in a huge trade deficit. It cannot be any other way.
The last time the US had a small trade surplus was in 1975, just after it reneged on the Bretton Woods Agreement, destroying the international financial agreements that had persisted since the Second World War.
By that time, the expansion of credit had begun to fuel the new consumer-led economy and the trade deficits began to emerge - and have continued ever since. And these trade deficits are not only with China. During the past 35 years, the US has consistently had trade deficits with more than 60 countries.
Worse, the US economy is fueled to an exaggerated extent by credit. Americans save no money but spend today's money and next year's. Consumer demand is therefore exaggerated and artificial, and the US (both government and consumers) is living beyond its means. It is borrowing from the future to spend today.
In simple terms, the US consistently buys more than it sells. It means that the world, including China, produces many things that the US wants to buy, but the US is consistently producing fewer goods that the rest of the world wants to buy.
This is the source of the trade deficits. It has nothing to do with the value of the Chinese RMB. In the almost 35 intervening years every country's currency has been up and down, often many times, but the US trade deficits (with all countries) have persisted through all of that.
The US cannot increase its exports unless it sells more arms and weapons, or commercial aircraft. It can try to increase exports of services, but that isn't so easy as the Americans thought. You can export some professional services like consulting and insurance, and tourism is a useful export. But you cannot export restaurants and dry cleaning. The scope for US exports is quite limited.
The US Credit Binge
The US economy is fuelled to an excessive extent by credit, especially consumer credit, and the US savings rate has been at zero or negative for quite some time. Americans are spending not only today's money, but also tomorrow's and next year's. Borrowing money for investment can be wise; borrowing for consumption will lead to disaster.
During the recent subprime financial disaster, Americans were using their homes like ATMs. As their houses increased in value, Americans increased the mortgages on those homes - and spent the money. As the values rose again, the process was repeated. Housing prices collapsed, the housing bubble burst, and more than 25% of all Americans owe the bank more money than the value of the house; many owe twice the value of their homes.
One of the fundamental problems with the US economy is that both the government and its population are living beyond their means, borrowing money for consumption, spending tomorrow's money today with little apparent thought of how to repay. With so much of the US economy fueled by credit, the US is not only living beyond its means, but its 'standard of living' is artificially high; my personal guess is 30% too high. This cannot likely be sustained; a major correction is inevitable.
The US wants other countries to adopt their model - stop saving, push consumer spending, overflow with liquidity, use consumer credit to a much greater degree. If this were to happen, the trade deficits might decrease, but Canadians, Japanese and Chinese will not do that.
Since the US is the only country that follows this model, the best solution is that they increase savings, reduce liquidity and consumer credit to dampen demand, and live within their means. But that's not likely to happen because it will mean an economic contraction and significantly reduced living standard.
Fred Li
Taiwan
During the past couple of years, the writings of Professor Krugman often puzzled me. Is this the same Krugman who taught me so much with his earlier books, like, “Peddling Prosperity”? Holding large amount of foreign reserve is a sign of an economy’s inability to utilize her assets, isn’t it? Buying a lot of US treasury bonds is a way of giving a loan to the seller, isn’t it? The borrower can use the loan in different ways, like building green technology, improving the crumbling infrastructure, but should not be used in blowing up a real estate bubble. Right? The loan provider, in this case, cannot dictate to the borrower for what the loan is to be used. Right?
Krugman’s accusation that China restricted foreign investment is ludicrous. China is the destination one of the largest FDI in the world! Is China hurting US employment? One period that had unemployment figures, comparable to today, was during the early 1980’s, before China began to export at all. In subsequent years, China began to export more and more and correspondingly the US boomed! How about jobs? There was a time when New England had a major textile industry that shriveled away. Jobs of those textile workers were taken by foreigners, Japanese first, Asian tigers next, and China following. It was the Japanese who took away US jobs not the Chinese. The jobs are now leaving China for places like Vietnam, Sri Lanka. They will not go back to New England! The irresponsible Wall Street types playing with “financial innovation” caused the financial crisis, which led to the current high unemployment. Wasn’t it? The whole world, including significantly the developing countries, paid for that bit of Anglo-Saxon shenanigan and we are, by and large, out of it by now. The US is not even in recession; the corporations are making record profits but they are just not hiring. One may argue that the US workers are improving on productivity so much that not so many is needed. If you look beyond the US, Germany is booming! Their unemployment rate dropped significantly. Newly rich Asians want to buy BMWs and Porsches, not Ford. Appreciation of the RMB will reduce the trade imbalance! Will it? During 2007 to 2008, RMB did appreciate over 20% and the trade imbalance worsened.
Is the US government too passive in facing up to China? It is true that whatever you think the Obama government doesn’t have many cards to play against China short of going to war. The US is in two wars right now already! It is also true the government can’t do much on anything else either, not on further stimulus, not on immigration, not on renewable energy. It is mired in the quagmire of political polarization of historical proportion!
Third Party
Tom Friedman opines in New York Times that the US needs a Third Party, which he finds rising. People talk.
Robert
Washington, DC
Yes we need a third party, for sure!
However, a 3rd party will NOT solve our problems. America is destined to Roman era decline, only at light speed! Before we can begin to solve problems we must first understand the problems.
Problem #1 = Democracy. Too many people with too many unfounded opinions, too many vested interests, too many defacto legally created monopolies, with too many dreams, goals and aspirations all willing to step on the backs of others to achieve their goals!
Problem #2 = Economics. Poor resource distribution. Income and expenses are totally out of kilter! Economics as a science is sophisticated dogma at best, and as conjured-up in America, fails to paint a true and accurate picture of our economic world, resource base, wealth creation opportunities and wealth distribution.
Problem #3 - America has zero ability to compete globally. We are destined to become a nation of burger flippers.
Problem #4 - Mediocre legal and judicial system that enforces our totally dysfunctional system. Restrictive practices in the professions, trades etc. all intended to benefit a few at the expense of the many.
Problem #5 - Every new law is designed to carve out a niche of protected activity for some special interest sector of society!
Problem #6 - A huge population of know nothings. Even those with top educations often know little to nothing! An educational system from kindergarten up to graduate school that deserves nothing but shame!
Problem #7 - A body politic that is second to none in terms of personal selfishness, foolishness and short sightedness!
Problem #8 - A military hegemon that has few true friends on the planet that has created the conditions for about 5 billion people, or barbarians in Roman speak, to one day crash down our gates and enslave the American population. From the vantage point of God's accounting ledgers, one would say, and deservedly so!
So, with all of these problems there is only one real solution. Only one possible way to right these wrongs. Only one possible way to harness the once mighty American industrial machine. This way is NOT found in voting nor democracy nor elections, nor congress, legislators, governors, judges or county clerks...
One fears that those who so strongly urged George Washington to claim a crown, to forgo democracy, who foresaw the folly of democracies will be proven unquestionably correct!
You want real leadership then our answers lie in benevolent dictatorships! Many will recognize this leader as a Philosopher King. Ronald Dworkin once gave us the idea of the all knowing, timeless intellectual giant that could pounder the rubrics of our time and lead us to just and fair results.
For those fearful of the yoke they will shout DICTATORSHIP or DICTATORSHIP of the proletariat! How much would our lives really change? China developed state backed capitalism? It is time for peaceful revolution. Americans are cows. They can be lead to the bolt gun with easy credit!
Philosopher King? Yes who would make a good Philosopher King?
Robert
Washington, DC
Projunior
Tulsa, OK
"I’ve just spent a week in Silicon Valley, talking with technologists from Apple, Twitter, LinkedIn, Intel, Cisco and SRI..."
The level of disgust goes beyond the two party system. It extends to the boardrooms of corporate America. The executives who run American companies no longer care about this country or its workers. If their bonuses can be made bigger by laying off people, outsourcing jobs, and closing factories, then that's exactly what they'll do. These CEO's have long since stopped identifying the future of their companies with the future of America.
Stop your schoolgirl gushing over the wizards of Silicon Valley. Those people care not one whit about America. Don't believe me? How about asking John Chambers, CEO of Cisco, about this remark of his:
"What we're trying to do is outline an entire strategy of becoming a Chinese company."
These same companies claim, and you gullibly swallow hook, line, and sinker, the ludicrous proposition that America doesn't produce enough math and engineering students. Microsoft, IBM, HP wring their hands and say they are forced to shift jobs to India and China. They have no choice but to lobby Congress for more H1-B foreign workers. And you, Mr. Friedman, repeat this canard ad nauseum in column after column. But the reality is quite different as Hal Salzman, professor of public policy at the E.J. Bloustein School and the J.J. Heldrich Center for Workforce Development at Rutgers University, stated in The Times on September 14:
"Moreover, there is neither a shortage of U.S. students who are world-class in their educational performance nor of college graduates with science and engineering degrees. The U.S. can claim the lion’s share of the world’s highest performing (domestic) science students and continues to graduate more than two times the number of scientists and engineers than are hired each year."
See? American companies and their clueless media marionettes are selling out America. They are chewing up and spitting out the middle class.
Yes, we are fed up with Washington? But we are scared stiff about the creeping corporatocracy that the media (they are Big Business too!) so glibly ignores. As Jeff Faux of the Economic Policy Institute so rightly points out:
"But I think for most politicians economic theory conveniently rationalized their support of the interests of corporate CEOs over their workers. Remember, over the last 30 years, the share of campaign contributions representing big business has grown dramatically -- as has the number of ex-administration officials and members of Congress who go to work for corporations as employees, consultants, and lobbyists."
Robert Henry Eller
Milan, Italy
If wishes were fishes.
Sorry, Mr. Friedman. But it only costs corporate America and other special interests about $5 billion annually to but the entire Federal Government. In a $14 trillion economy, that's chump change (and guess who the chumps are?).
The same small group of political financiers can easily up their budget to either compromise any third (or fourth) party, or simply bury it with increased support for their current stooges. No problem.
It doesn't matter whether we have one party (as we do now) or five. The only thing that matters is if most voters learn to vote their own interests, and we find a way to ensure that elected officials actually work for those who voted for them. Assuming we still have a one-person-one-vote democracy.
What we need is a non-corporate media, and a buy-proof government. Not easy. But that would be a revolution.
KM
Pasadena, CA
The analogy to Roman history is false. The cause of the Roman decline
was the elimination of the peasant farmer on the Italian peninsula and
the incorporation of these small farmers' land into the large estates
of the rich. These small farmers had been where Rome had drawn its
legions, which were unparalleled for a period of four hundred years (200BC to 200AD)--as Gibbons notes, the legions of the 3rd and 4th century were no match for those of two hundred years earlier.
The analogy to the current American situation is obvious. The peasant farmers were the equivalent of today's middle class, which is under unrelenting attack from the wealthy. Contrary to Friedman's complaints about the "far left" and corporate taxation, the primary diversion of corporate funds from innovation and investment is through the huge sums paid to corporate officers and continual demands for increased returns for capital through rising share prices and dividends. This has lead to an unprecedented accumulation of income to the nation's top one percent--24% of the nation's income. This group, having grabbed such a large share, wants more--and the only way that can come about is through further evisceration of the middle class.
Friedman should know that the longest sustained prosperity in this country's history was in the post-war era, when government programs were designed to enlarge and enrich the middle class (GI Bill, FHA, etc). Now, the three largest middle class expenditures, education, health care and housing, have gone through the roof. The economic downturn has
removed many from the middle class and made the remainder fearful of
arguing for any increase in their compensation.
The secret to America's economic revival is programs that revitalize
the middle class. It is no accident that northern European economies are doing better than ours, as they have strong policies to protect
the middle class (and one can be a manual worker in those countries and still be in the middle class). Friedman's complaints about the American economic system primarily reflect the capture of the political system by those with high incomes and a desire to maintain them--after all, nearly all of the contributions to political candidates comes from the top 1%. This is the "other election" that each Congressman/Senator must win every week (ten to twenty thousand dollars a week (or more!) for those in competitive races, which is now a large fraction of the Congress).
Until sufficient money is returned to the middle class for their labors the US will suffer from underconsumption and diminished economic returns for labor. Businesses aren't hiring because there aren't people to buy their goods.
Patrice Ayme
High Mountains Somewhere
The real infrastructure stimulus of Obama was 50 billion dollars spread over two years (the rest compensated for the collapse of state spending and the like). That's all.
By comparison, that was exactly the size of the French infrastructure stimulus spent in 2009 alone.
By a further, and more illuminating comparison the bank bonuses were 150 billion dollars in the USA in 2009 alone. Those bonuses were made possible, in several ways, only by general taxpayers.
So who is been made into a laughing stock by Obama?
The USA two party system is one party removed from dictatorship. Why should it be an institution? All European democracies have at least three parties (the UK), and sometimes much more. The two existing parties in the USA are two aspects of the same plutocratic party. Obama has been governing like what passes for a moderate republican nowadays, somewhere right of Nixon. So it is during collapse: yesterday's abyss is today's moderation.
Robert
Washington, DC
Yes we need a third party, for sure!
However, a 3rd party will NOT solve our problems. America is destined to Roman era decline, only at light speed! Before we can begin to solve problems we must first understand the problems.
Problem #1 = Democracy. Too many people with too many unfounded opinions, too many vested interests, too many defacto legally created monopolies, with too many dreams, goals and aspirations all willing to step on the backs of others to achieve their goals!
Problem #2 = Economics. Poor resource distribution. Income and expenses are totally out of kilter! Economics as a science is sophisticated dogma at best, and as conjured-up in America, fails to paint a true and accurate picture of our economic world, resource base, wealth creation opportunities and wealth distribution.
Problem #3 - America has zero ability to compete globally. We are destined to become a nation of burger flippers.
Problem #4 - Mediocre legal and judicial system that enforces our totally dysfunctional system. Restrictive practices in the professions, trades etc. all intended to benefit a few at the expense of the many.
Problem #5 - Every new law is designed to carve out a niche of protected activity for some special interest sector of society!
Problem #6 - A huge population of know nothings. Even those with top educations often know little to nothing! An educational system from kindergarten up to graduate school that deserves nothing but shame!
Problem #7 - A body politic that is second to none in terms of personal selfishness, foolishness and short sightedness!
Problem #8 - A military hegemon that has few true friends on the planet that has created the conditions for about 5 billion people, or barbarians in Roman speak, to one day crash down our gates and enslave the American population. From the vantage point of God's accounting ledgers, one would say, and deservedly so!
So, with all of these problems there is only one real solution. Only one possible way to right these wrongs. Only one possible way to harness the once mighty American industrial machine. This way is NOT found in voting nor democracy nor elections, nor congress, legislators, governors, judges or county clerks...
One fears that those who so strongly urged George Washington to claim a crown, to forgo democracy, who foresaw the folly of democracies will be proven unquestionably correct!
You want real leadership then our answers lie in benevolent dictatorships! Many will recognize this leader as a Philosopher King. Ronald Dworkin once gave us the idea of the all knowing, timeless intellectual giant that could pounder the rubrics of our time and lead us to just and fair results.
For those fearful of the yoke they will shout DICTATORSHIP or DICTATORSHIP of the proletariat! How much would our lives really change? China developed state backed capitalism? It is time for peaceful revolution. Americans are cows. They can be lead to the bolt gun with easy credit!
Philosopher King? Yes who would make a good Philosopher King?
Robert
Washington, DC
Projunior
Tulsa, OK
"I’ve just spent a week in Silicon Valley, talking with technologists from Apple, Twitter, LinkedIn, Intel, Cisco and SRI..."
The level of disgust goes beyond the two party system. It extends to the boardrooms of corporate America. The executives who run American companies no longer care about this country or its workers. If their bonuses can be made bigger by laying off people, outsourcing jobs, and closing factories, then that's exactly what they'll do. These CEO's have long since stopped identifying the future of their companies with the future of America.
Stop your schoolgirl gushing over the wizards of Silicon Valley. Those people care not one whit about America. Don't believe me? How about asking John Chambers, CEO of Cisco, about this remark of his:
"What we're trying to do is outline an entire strategy of becoming a Chinese company."
These same companies claim, and you gullibly swallow hook, line, and sinker, the ludicrous proposition that America doesn't produce enough math and engineering students. Microsoft, IBM, HP wring their hands and say they are forced to shift jobs to India and China. They have no choice but to lobby Congress for more H1-B foreign workers. And you, Mr. Friedman, repeat this canard ad nauseum in column after column. But the reality is quite different as Hal Salzman, professor of public policy at the E.J. Bloustein School and the J.J. Heldrich Center for Workforce Development at Rutgers University, stated in The Times on September 14:
"Moreover, there is neither a shortage of U.S. students who are world-class in their educational performance nor of college graduates with science and engineering degrees. The U.S. can claim the lion’s share of the world’s highest performing (domestic) science students and continues to graduate more than two times the number of scientists and engineers than are hired each year."
See? American companies and their clueless media marionettes are selling out America. They are chewing up and spitting out the middle class.
Yes, we are fed up with Washington? But we are scared stiff about the creeping corporatocracy that the media (they are Big Business too!) so glibly ignores. As Jeff Faux of the Economic Policy Institute so rightly points out:
"But I think for most politicians economic theory conveniently rationalized their support of the interests of corporate CEOs over their workers. Remember, over the last 30 years, the share of campaign contributions representing big business has grown dramatically -- as has the number of ex-administration officials and members of Congress who go to work for corporations as employees, consultants, and lobbyists."
Robert Henry Eller
Milan, Italy
If wishes were fishes.
Sorry, Mr. Friedman. But it only costs corporate America and other special interests about $5 billion annually to but the entire Federal Government. In a $14 trillion economy, that's chump change (and guess who the chumps are?).
The same small group of political financiers can easily up their budget to either compromise any third (or fourth) party, or simply bury it with increased support for their current stooges. No problem.
It doesn't matter whether we have one party (as we do now) or five. The only thing that matters is if most voters learn to vote their own interests, and we find a way to ensure that elected officials actually work for those who voted for them. Assuming we still have a one-person-one-vote democracy.
What we need is a non-corporate media, and a buy-proof government. Not easy. But that would be a revolution.
KM
Pasadena, CA
The analogy to Roman history is false. The cause of the Roman decline
was the elimination of the peasant farmer on the Italian peninsula and
the incorporation of these small farmers' land into the large estates
of the rich. These small farmers had been where Rome had drawn its
legions, which were unparalleled for a period of four hundred years (200BC to 200AD)--as Gibbons notes, the legions of the 3rd and 4th century were no match for those of two hundred years earlier.
The analogy to the current American situation is obvious. The peasant farmers were the equivalent of today's middle class, which is under unrelenting attack from the wealthy. Contrary to Friedman's complaints about the "far left" and corporate taxation, the primary diversion of corporate funds from innovation and investment is through the huge sums paid to corporate officers and continual demands for increased returns for capital through rising share prices and dividends. This has lead to an unprecedented accumulation of income to the nation's top one percent--24% of the nation's income. This group, having grabbed such a large share, wants more--and the only way that can come about is through further evisceration of the middle class.
Friedman should know that the longest sustained prosperity in this country's history was in the post-war era, when government programs were designed to enlarge and enrich the middle class (GI Bill, FHA, etc). Now, the three largest middle class expenditures, education, health care and housing, have gone through the roof. The economic downturn has
removed many from the middle class and made the remainder fearful of
arguing for any increase in their compensation.
The secret to America's economic revival is programs that revitalize
the middle class. It is no accident that northern European economies are doing better than ours, as they have strong policies to protect
the middle class (and one can be a manual worker in those countries and still be in the middle class). Friedman's complaints about the American economic system primarily reflect the capture of the political system by those with high incomes and a desire to maintain them--after all, nearly all of the contributions to political candidates comes from the top 1%. This is the "other election" that each Congressman/Senator must win every week (ten to twenty thousand dollars a week (or more!) for those in competitive races, which is now a large fraction of the Congress).
Until sufficient money is returned to the middle class for their labors the US will suffer from underconsumption and diminished economic returns for labor. Businesses aren't hiring because there aren't people to buy their goods.
Patrice Ayme
High Mountains Somewhere
The real infrastructure stimulus of Obama was 50 billion dollars spread over two years (the rest compensated for the collapse of state spending and the like). That's all.
By comparison, that was exactly the size of the French infrastructure stimulus spent in 2009 alone.
By a further, and more illuminating comparison the bank bonuses were 150 billion dollars in the USA in 2009 alone. Those bonuses were made possible, in several ways, only by general taxpayers.
So who is been made into a laughing stock by Obama?
The USA two party system is one party removed from dictatorship. Why should it be an institution? All European democracies have at least three parties (the UK), and sometimes much more. The two existing parties in the USA are two aspects of the same plutocratic party. Obama has been governing like what passes for a moderate republican nowadays, somewhere right of Nixon. So it is during collapse: yesterday's abyss is today's moderation.
23.9.10
Do we love to hate insurers?
Susanp
San francisco, ca
While everyone likes to blame the insurers, it is a business and actually serves a purpose. They should not be allowed, and don't, to make huge profits (unlike the pharmaceutical industry). Many years ago, health insurance just covered hospital as that was considered catastrophic. The smart doctors started admitting patients for routine physicals - patients loved it as they didn't have to pay and the doctors could charge more. Insurers got smart and started coverage outpatient. So there is a delicate balance that works to keep things in check.
I admit the insurers want to make a modest profit. If they are making too big a profit why wouldn't some one come in and undercut them. Everyone cites 45,000/year die from being uninsured. However, over 200,000 die from medical errors - too much treatment.
Several years ago insurers weren't covering a chemo treatment but lost a multi-million dollar suit so started covering it. Later found out that the studies were falsified, this treatment was grueling and also killed people - but the docs and hosps were making huge profits on it. Again, a delicate balance.
Insurance companies aren't the good guys, but they aren't the bad guys either. The examples above show how providers game the system - the federal gov't doesn't have the incentive to check that - just look at Medicare.
The health care law should have been about more affordable care first - which it does nothing to control. Like a car manufacturer can't hold prices down when the price of tires and steel goes up, the insurers can't hold prices down as more and more is covered and the pharmas and providers are allowed to raise prices.
Joel L. Friedlander
Plainview, New York
There is no way that the insurance companies can charge enough premium to cover, say, a juvenile hemophiliac who requires $1,000.00 in medication every day. There are numerous other diseases that are too costly to cover, and requiring everyone to buy insurance isn't going to cover it. That is, if the insurance companies are going to make enough money to really profit from the business. Insurance companies aren't charities and so they cannot be expected to provide money for medical care if they cannot earn money for their workers. The answer is that the plan is going to result in the end of insurance and ultimately in National Health Care. Only the government can afford to cover a people who have eaten themselves into obesity and late onset diabetes, earlier and earlier cardiac problems, and ever increasing debilitating illnesses. Only National Health Care will work, and it will require that the fat, sloppy, uncontrolled people of this country take themselves in hand and work to better their own physical condition.
There was a story a few years ago about a tribe of Native Americans, Indians that is, who discovered that once they had taken on the White Man's ways they had a massive incidence of heart disease and diabetes. It was because their bodies required lots of physical exercise because of centuries of living on the edge. What they did was to institute a tribal exercise program for everyone in the tribe. The result was that their heart conditions improved and their incidence of diabetes decreased. They were an intelligent people and we can learn from them. We too, all of us, require exercise, since none of us comes from a past where physical labor was absent. We can improve our physical condition and reduce the costs of health care.
Also, since 80% of medicare monies are spent in the last few months of life, it is perhaps time for us to look into our own souls and when we reach the end, admit that we cannot live forever. I wonder if we could ever do that. Is life so sweet as to be purchased at the cost of chains and slavery for our progeny?
jeff f
charlestown, MA
Most ignore the fact that the availability of quality medical professionals (i.e. doctors), not the availability of insurance, will ultimately determine the availability and adequacy of health care. What good is the insurance if the internist or specialist is not accepting new patients? What good is insurance that will pay for a joint replacement or open heart surgery, etc. if there is no board certified surgeon within hundreds of miles and/or you cannot get an appointment with the surgeon for 6 months or more? As one surgeon and one expert in the financial end of healthcare recently told me, in due course we'll be going to India or to new surgical centers that will be set up in the Caribbean, and many will continue to be unable to get top-notch healthcare in the US if for no other reason than that THERE WILL NOT BE ENOUGH DOCTORS. We will then discover it's not about paying for healthcare, it's about demand exceeding supply (old-fashioned market economics).
San francisco, ca
While everyone likes to blame the insurers, it is a business and actually serves a purpose. They should not be allowed, and don't, to make huge profits (unlike the pharmaceutical industry). Many years ago, health insurance just covered hospital as that was considered catastrophic. The smart doctors started admitting patients for routine physicals - patients loved it as they didn't have to pay and the doctors could charge more. Insurers got smart and started coverage outpatient. So there is a delicate balance that works to keep things in check.
I admit the insurers want to make a modest profit. If they are making too big a profit why wouldn't some one come in and undercut them. Everyone cites 45,000/year die from being uninsured. However, over 200,000 die from medical errors - too much treatment.
Several years ago insurers weren't covering a chemo treatment but lost a multi-million dollar suit so started covering it. Later found out that the studies were falsified, this treatment was grueling and also killed people - but the docs and hosps were making huge profits on it. Again, a delicate balance.
Insurance companies aren't the good guys, but they aren't the bad guys either. The examples above show how providers game the system - the federal gov't doesn't have the incentive to check that - just look at Medicare.
The health care law should have been about more affordable care first - which it does nothing to control. Like a car manufacturer can't hold prices down when the price of tires and steel goes up, the insurers can't hold prices down as more and more is covered and the pharmas and providers are allowed to raise prices.
Joel L. Friedlander
Plainview, New York
There is no way that the insurance companies can charge enough premium to cover, say, a juvenile hemophiliac who requires $1,000.00 in medication every day. There are numerous other diseases that are too costly to cover, and requiring everyone to buy insurance isn't going to cover it. That is, if the insurance companies are going to make enough money to really profit from the business. Insurance companies aren't charities and so they cannot be expected to provide money for medical care if they cannot earn money for their workers. The answer is that the plan is going to result in the end of insurance and ultimately in National Health Care. Only the government can afford to cover a people who have eaten themselves into obesity and late onset diabetes, earlier and earlier cardiac problems, and ever increasing debilitating illnesses. Only National Health Care will work, and it will require that the fat, sloppy, uncontrolled people of this country take themselves in hand and work to better their own physical condition.
There was a story a few years ago about a tribe of Native Americans, Indians that is, who discovered that once they had taken on the White Man's ways they had a massive incidence of heart disease and diabetes. It was because their bodies required lots of physical exercise because of centuries of living on the edge. What they did was to institute a tribal exercise program for everyone in the tribe. The result was that their heart conditions improved and their incidence of diabetes decreased. They were an intelligent people and we can learn from them. We too, all of us, require exercise, since none of us comes from a past where physical labor was absent. We can improve our physical condition and reduce the costs of health care.
Also, since 80% of medicare monies are spent in the last few months of life, it is perhaps time for us to look into our own souls and when we reach the end, admit that we cannot live forever. I wonder if we could ever do that. Is life so sweet as to be purchased at the cost of chains and slavery for our progeny?
jeff f
charlestown, MA
Most ignore the fact that the availability of quality medical professionals (i.e. doctors), not the availability of insurance, will ultimately determine the availability and adequacy of health care. What good is the insurance if the internist or specialist is not accepting new patients? What good is insurance that will pay for a joint replacement or open heart surgery, etc. if there is no board certified surgeon within hundreds of miles and/or you cannot get an appointment with the surgeon for 6 months or more? As one surgeon and one expert in the financial end of healthcare recently told me, in due course we'll be going to India or to new surgical centers that will be set up in the Caribbean, and many will continue to be unable to get top-notch healthcare in the US if for no other reason than that THERE WILL NOT BE ENOUGH DOCTORS. We will then discover it's not about paying for healthcare, it's about demand exceeding supply (old-fashioned market economics).
20.9.10
about the psychology of taxes
pdxtran
Minneapolis
Naturally, the top 1% are advocating the interests of their own class, sometimes ridiculously so. I'll never forget the time a woman wrote to the (Portland) Oregonian, saying, "I pay $100,000 a year in income taxes, but I'm not rich..."
What is more puzzling and infuriating is the stubbornness of people who are not rich, who are downright poor in some cases, arguing for special privileges for the top income levels.
When I read the comments in the online edition of my local newspaper, I see a subset of readers who seem to have Stockholm syndrome in connection with the rich. Their attitude typifies the saying, "Republicans think that the rich don't have enough money and poor people have too much." That is, they insist on the need for tax cuts for the super-rich and express clear disdain, even hatred, for the poor.
Judging from the nearly universal semi-literacy of their writings, I would guess that the annual incomes of these writers are closer to $25,000 than to $250,000, and so I have wondered about the mindset that underlies their opinions.
The first ingredient in that mindset is the right-wing media, not only Fox News and AM radio, but magazines, public access television, and megachurches that have mysteriously sprung up full grown in America's suburbs to preach a "gospel" that owes more to the Republican Party platform than to the words of Jesus. It's possible to live in a total information environment that not only pushes right-wing politics 24/7 but also tells its audience that other sources of information are "biased."
The second ingredient in this mindset is continual exposure to entertainment media that present glamorous, fantasy lifestyles instead of ordinary people. Lifestyles of the Rich and Famous is one of the most obvious examples, but we can also note the absence of working class or even typical middle class people in network dramas and comedies. This is in contrast to what one sees on foreign television programs, namely, ordinary-looking characters who live the same unglamorous lives that their real-life counterparts would.
American culture, especially commercial culture, plays a role, too. From childhood, we are taught "work hard and you'll get ahead," with "ahead" meaning "financially secure." This conditioning makes it easy for Americans to believe that all wealthy people acquired their wealth through hard work (as opposed to inheriting it or playing financial games while seated at a computer) while all poor people are lazy.
A bit of fear may be involved as well. Someone whose livelihood is somehow dependent on investments or purchases by the super-wealthy may worry that a few hundred or a few thousand extra dollars in taxes will discourage multimillionaires and billionaires from investing and spending.
They may not know enough about accounting to realize that businesses pay income tax on profits, not on total income. As such, they may be susceptible to right-wing propagandists who say that high income taxes cause businesses to fail or that low or non-existent income taxes will cause businesses to step up hiring, even in the absence of customers.
Finally, I believe that a bit of magical thinking is involved. When a person of modest means promotes the interests of people who make as much in a year as the typical American will make in a lifetime, I see someone who is thinking, "Maybe if I praise rich people and despise poor people enough, God will see that I deserve to be rich--or that I at least deserve not to fall into poverty."
Taken together, these factors may explain why the whining of the super-rich about a negligible tax increase resonates so strongly with Americans who will never have to pay it.
Minneapolis
Naturally, the top 1% are advocating the interests of their own class, sometimes ridiculously so. I'll never forget the time a woman wrote to the (Portland) Oregonian, saying, "I pay $100,000 a year in income taxes, but I'm not rich..."
What is more puzzling and infuriating is the stubbornness of people who are not rich, who are downright poor in some cases, arguing for special privileges for the top income levels.
When I read the comments in the online edition of my local newspaper, I see a subset of readers who seem to have Stockholm syndrome in connection with the rich. Their attitude typifies the saying, "Republicans think that the rich don't have enough money and poor people have too much." That is, they insist on the need for tax cuts for the super-rich and express clear disdain, even hatred, for the poor.
Judging from the nearly universal semi-literacy of their writings, I would guess that the annual incomes of these writers are closer to $25,000 than to $250,000, and so I have wondered about the mindset that underlies their opinions.
The first ingredient in that mindset is the right-wing media, not only Fox News and AM radio, but magazines, public access television, and megachurches that have mysteriously sprung up full grown in America's suburbs to preach a "gospel" that owes more to the Republican Party platform than to the words of Jesus. It's possible to live in a total information environment that not only pushes right-wing politics 24/7 but also tells its audience that other sources of information are "biased."
The second ingredient in this mindset is continual exposure to entertainment media that present glamorous, fantasy lifestyles instead of ordinary people. Lifestyles of the Rich and Famous is one of the most obvious examples, but we can also note the absence of working class or even typical middle class people in network dramas and comedies. This is in contrast to what one sees on foreign television programs, namely, ordinary-looking characters who live the same unglamorous lives that their real-life counterparts would.
American culture, especially commercial culture, plays a role, too. From childhood, we are taught "work hard and you'll get ahead," with "ahead" meaning "financially secure." This conditioning makes it easy for Americans to believe that all wealthy people acquired their wealth through hard work (as opposed to inheriting it or playing financial games while seated at a computer) while all poor people are lazy.
A bit of fear may be involved as well. Someone whose livelihood is somehow dependent on investments or purchases by the super-wealthy may worry that a few hundred or a few thousand extra dollars in taxes will discourage multimillionaires and billionaires from investing and spending.
They may not know enough about accounting to realize that businesses pay income tax on profits, not on total income. As such, they may be susceptible to right-wing propagandists who say that high income taxes cause businesses to fail or that low or non-existent income taxes will cause businesses to step up hiring, even in the absence of customers.
Finally, I believe that a bit of magical thinking is involved. When a person of modest means promotes the interests of people who make as much in a year as the typical American will make in a lifetime, I see someone who is thinking, "Maybe if I praise rich people and despise poor people enough, God will see that I deserve to be rich--or that I at least deserve not to fall into poverty."
Taken together, these factors may explain why the whining of the super-rich about a negligible tax increase resonates so strongly with Americans who will never have to pay it.
13.9.10
don't we all love goldman?
Justin Lin
Beijing
I would like to point out that Goldman has been at the heart of every scam running on Wall Street.
1. Sitting in at the table in September 2008 on the AIG deal (heck, their use of AIG because the regular monolines wouldn’t touch their dreck) and then having Geithner sign off on payouts to Goldman among others at par in November 2008
2. Their involvement in the dark pools (Sigma X is the biggest player in them and guess who owns it?)
3. The use of computer frontrunning
4. The use of "huddles" to reward some customers and stiff others
5. Manipulation of oil markets (through its subsidiary J. Aron, and you wondered why gas was selling at around $3 a gallon in a recession)
6. Its involvement in the Greek sovereign debt crisis
7. Its revolving door penetration and control of both the Fed and Treasury (Remember how Hank Paulson former chairman and CEO of Goldman was Treasury Secretary when everything hit the fan, or how he put his mini-me Kashkari a 30 something Goldman exec who had followed him to Treasury in to head the TARP? Robert Rubin ring any bells? The list of the Goldman’s "public service" is long. Thank goodness, that’s all over. Oh wait, William Dudley Goldman’s former chief economist is the current president of the NY Fed and Mark Patterson who also is a Goldman alum is Timmy’s minder chief of staff)
8. Its manipulation of stock markets by trading on its own account (acting like its own hedge fund) and also through its participation in the NYSE’s Supplemental Liquidity Provider program (So you wondered how those sudden late in the day "rallies" happened. Some exchanges are so effectively controlled that only an idiot like a pension fund manager would be stupid enough to invest in them)
9. And as long as we are on the subject of exchanges, the one that ICE has set up to handle derivatives is owned by Goldman and other big players.
10. Its history of stiffing investors by awarding employees monster size bonuses.
11. And of course it was Hank Paulson back in April 2004 who persuaded SEC head Christopher Cox to remove leverage limits (through elimination of the net capital rule, and we know how that turned out)
12. After Lehman blew up on September 15, 2008, Goldman and Morgan Stanley got their applications insta-approved just 6 days later on the 21st to become bankholding companies. This gave Goldman access to fat government credit lines and allowed them to pick up where they had left off.
13. However, when it became apparent that being a bankholding company might lead to some government oversight, Goldman changed its status yet again and became a financial holding company
14. Then of course we have the current fraud charges based on Goldman loading a CDO with dreck, selling CDS on it through ACA to John Paulson et al and then selling the toxic CDO to sophisticated investors, also known as fund managers and foreign banks, or rubes for short
15. Finally, there has been Goldman’s successful push with other big financial players against any meaningful financial reform. Some have said that the Goldman charges were a means to pre-empt a Wall Street effort to block reform. What this ignores is that both the Frank and Dodd bills are already empty vessels. Watching Democrats beat their breasts and accuse Republicans of being in bed with Wall Street is the kind of humorous hypocrisy and kabuki that many of us got used to in the healthcare debate or before that with the wars in Iraq and Afghanistan.
In any case, this is a list I made pretty much on the fly. Its purpose is to remind myself as much as anyone why enterprises like Goldman Sachs should not exist. They serve no useful social or market function. Not only do they not create wealth, they lead to great wealth destruction. They are completely and totally unreformable. We look at the bonuses and say that it only took them a year to go back to their old ways. The truth is that Goldman never gave up its ways. It found a new patsy, the US taxpayer, within days of the meltdown and the crony casino capitalist band played on.
Beijing
I would like to point out that Goldman has been at the heart of every scam running on Wall Street.
1. Sitting in at the table in September 2008 on the AIG deal (heck, their use of AIG because the regular monolines wouldn’t touch their dreck) and then having Geithner sign off on payouts to Goldman among others at par in November 2008
2. Their involvement in the dark pools (Sigma X is the biggest player in them and guess who owns it?)
3. The use of computer frontrunning
4. The use of "huddles" to reward some customers and stiff others
5. Manipulation of oil markets (through its subsidiary J. Aron, and you wondered why gas was selling at around $3 a gallon in a recession)
6. Its involvement in the Greek sovereign debt crisis
7. Its revolving door penetration and control of both the Fed and Treasury (Remember how Hank Paulson former chairman and CEO of Goldman was Treasury Secretary when everything hit the fan, or how he put his mini-me Kashkari a 30 something Goldman exec who had followed him to Treasury in to head the TARP? Robert Rubin ring any bells? The list of the Goldman’s "public service" is long. Thank goodness, that’s all over. Oh wait, William Dudley Goldman’s former chief economist is the current president of the NY Fed and Mark Patterson who also is a Goldman alum is Timmy’s minder chief of staff)
8. Its manipulation of stock markets by trading on its own account (acting like its own hedge fund) and also through its participation in the NYSE’s Supplemental Liquidity Provider program (So you wondered how those sudden late in the day "rallies" happened. Some exchanges are so effectively controlled that only an idiot like a pension fund manager would be stupid enough to invest in them)
9. And as long as we are on the subject of exchanges, the one that ICE has set up to handle derivatives is owned by Goldman and other big players.
10. Its history of stiffing investors by awarding employees monster size bonuses.
11. And of course it was Hank Paulson back in April 2004 who persuaded SEC head Christopher Cox to remove leverage limits (through elimination of the net capital rule, and we know how that turned out)
12. After Lehman blew up on September 15, 2008, Goldman and Morgan Stanley got their applications insta-approved just 6 days later on the 21st to become bankholding companies. This gave Goldman access to fat government credit lines and allowed them to pick up where they had left off.
13. However, when it became apparent that being a bankholding company might lead to some government oversight, Goldman changed its status yet again and became a financial holding company
14. Then of course we have the current fraud charges based on Goldman loading a CDO with dreck, selling CDS on it through ACA to John Paulson et al and then selling the toxic CDO to sophisticated investors, also known as fund managers and foreign banks, or rubes for short
15. Finally, there has been Goldman’s successful push with other big financial players against any meaningful financial reform. Some have said that the Goldman charges were a means to pre-empt a Wall Street effort to block reform. What this ignores is that both the Frank and Dodd bills are already empty vessels. Watching Democrats beat their breasts and accuse Republicans of being in bed with Wall Street is the kind of humorous hypocrisy and kabuki that many of us got used to in the healthcare debate or before that with the wars in Iraq and Afghanistan.
In any case, this is a list I made pretty much on the fly. Its purpose is to remind myself as much as anyone why enterprises like Goldman Sachs should not exist. They serve no useful social or market function. Not only do they not create wealth, they lead to great wealth destruction. They are completely and totally unreformable. We look at the bonuses and say that it only took them a year to go back to their old ways. The truth is that Goldman never gave up its ways. It found a new patsy, the US taxpayer, within days of the meltdown and the crony casino capitalist band played on.
Walt & Obama
Trapped
Stephen M. Walt
Over the past twenty months, progressives, realists, and even some sensible conservatives have been disappointed by various aspects of the Obama administration's foreign and defense policy. Convinced that his election would mark a dramatic departure from the Bush administration's many missteps, they have been surprised and dismayed by Obama's increased reliance on drone attacks in Pakistan and elsewhere, his decisions to escalate the war in Afghanistan (not just once but twice), the retreat on Guantanamo, the Justice Department's use of dubious secrecy laws to shield torturers and deny victims the ability to sue them, the slow-motion reassessment of "Don't Ask, Don't Tell," the timid retreat from the lofty principles enunciated in his 2009 Cairo speech, and the unwillingness to consider anything more than trivial reductions in the bloated national security apparatus.
I share many of these concerns, but I don't really blame Obama. The buck may stop in the Oval Office, but it's not like he can simply wave a magic wand (or give another speech) and get the rest of the government to fall into line. Instead, the fact that U.S. foreign and defense policy hasn't changed very much reflects the powerful structural forces that inhibit any president's freedom of action. Or to put it more simply: he's trapped. Even if Obama wanted to chart a fundamentally different course (and I'm not at all sure that he does), he wouldn't be able to pull it off.
The first obstacle is America's current global position. Over the past sixty years, the United States built up a vast array of global military facilities, security partnerships, and overseas commitments. In the process, the United States ended up with the responsibility of providing a lot of collective goods (freedom of the seas, regional stability in Europe and Asia, security of global oil supplies, etc.) and it also ended up with a flock of client states who depend on us for various forms of economic, military, and diplomatic support.
These arrangements arose primarily due to the Cold War, but instead of dismantling them when the Cold War ended and returning to a more sensible and restrained grand strategy, the United States instead chose to expand its global responsibilities even further. This was partly because we didn't foresee any real opposition: as George H. W. Bush put it, we found ourselves "at the pinnacle of power, with the rarest opportunity to reshape the world." Hubris played a role too: U.S. leaders convinced themselves that we had the will and the skill to manage vast areas of the globe. Or as Secretary of State Madeleine Albright famously put it, the United States was the "indispensable nation" and that the U.S. "sees further than other countries into the future." And it was also because we thought that we could embed other countries into a set of rules and institutions that were largely of U.S. design. As Richard Haass, former director of policy planning and now president of the Council on Foreign Relations, declared in 2002, the goal was to integrate other countries "into arrangements that will sustain a world consistent with U.S. interests and values and thereby promote peace, prosperity, and justice."
So the United States expanded NATO deep into eastern Europe, adopted the foolish strategy of "dual containment" in the Persian Gulf, invaded Iraq in 2003 in a misguided attempt to transform the Middle East by force, and then got itself bogged down in a costly and ill-conceived effort at nation-building in Afghanistan. U.S. military forces remain deeply engaged on every continent, and as the Washington Post recently documented, the "war on terror" has led to a vast expansion in secret intelligence activities -- much of it conducted by a shadowy network of private contractors -- the scope of which is not even fully understood by the civilians who are allegedly in charge.
It is increasingly obvious that the United States has taken on a set of missions that it is not very good at, and that it cannot afford to continue without hollowing out its power here at home. It's also likely that some of these commitments are eventually going to go south (i.e., whenever we are propping up governments that lack popular support or that are pursuing policies that the rest of the world regards as wrong). The problem Obama faces, however, is that it would be neither easy nor cost-free to liquidate these commitments quickly. This is essentially a variation of the familiar "hegemon's dilemma": having occupied a position of primacy and taken on a vast array of global responsibilities, trying to disengage from them is like dismounting from a tiger. Once you begin to disengage, you may invite some short-term instability that actually makes things look worse. Moreover, any attempt to shift U.S. burdens onto others or to make significant cuts in our defense expenditures is bound to invite fierce opposition from the GOP, who would be quick to paint Obama as a cowardly or feckless appeaser. Instead of a long-overdue rethinking of U.S. strategy, therefore, we have a continuation of the status quo and an attempt to muddle through with our fingers firmly crossed.
The second impediment to change is the foreign policy establishment itself. As I've discussed before, the balance of political power inside Washington is heavily weighted towards the energetic use of American power -- and especially military power -- in virtually every corner of the world. Although think-tank denizens at Brookings, AEI, Heritage, and the Council on Foreign Relations sometimes disagree about specific policy initiatives, the vast majority are enthusiastic defenders of America's dominant global role. Hardly anyone at these institutions strays outside a rather narrow spectrum of thought, or questions the inherent legitimacy of the United States intervening just about anywhere it wants, even if the predictable results are the deaths of thousands of innocent civilians.
For the most part, debates within mainstream foreign policy circles run the gamut from A to B, from neoconservativism at one end and hawkish liberal interventionism at the other. As I said a few years ago, if neocons are essentially liberals on steroids, then most liberal internationalists are just kinder, gentler neocons. They agree on the virtues of American primacy, the need to prevent WMD from spreading (while keeping most of our own), the desirability of spreading democracy nearly everywhere, and the value of nearly all of the United States' current alliances. The only issue where neocons and liberals part company is the role of global institutions (neocons see them as dangerous constraints on U.S. autonomy, while liberals see them as useful supplements to American power). Given this basically bipartisan consensus, it is hardly surprising that most of the senior officials in Obama's foreign policy team were open supporters of the Iraq War, as well as steadfast believers in the United States right to intervene wherever and however it sees fit.
Ambitious foreign policy wonks understand that straying outside that comfortable consensus isn't going to advance their careers. That is why even sensible moderates have to polish their hawkish credentials if they want to be taken seriously, and even experienced pillars of the establishment are not immune from this same tendency. For example, the former president of the Council on Foreign Relations, Leslie Gelb, has admitted that he supported the Iraq War in 2003 in part to maintain his own bona fides within the establishment. In his words, "my initial support for the war [in Iraq] was symptomatic of unfortunate tendencies within the foreign policy community, namely the disposition and incentives to support wars to retain political and professional credibility" (emphasis added). And given that Gelb acted this way even though he was on the brink of retirement, you can imagine how more powerful this incentive is for someone starting out their career.
Finally, Obama clearly understands that the U.S. military has become a very powerful institution in American society, and that he doesn't have the personal background or clout to take them on directly. This situation helps us understand why he's gone slow on DADT, why he couldn't say no to their requests for more troops in Afghanistan, and why the Pentagon budget will continue to rise despite our massive budget woes.
In short, even if Barack Obama wanted to do many of the things that progressives might want, he would face enormous opposition from the uniformed services, the defense corporations who subsidize those conservative think tanks, the array of special interest groups pushing their own particular foreign policy projects, and the legion of hawkish pundits at Fox News, the Weekly Standard, and AM talk radio.
And let's not forget the true wing-nut elements in the American body politic. When both the secretary of Defense and our commanding general in Afghanistan have to waste precious time telling some obscure bigot in Florida that burning the Koran will put U.S. soldiers at greater risk, you know that the people who are allegedly running the country don't have much latitude to explore genuine alternatives.
In short, if you're disappointed that Barack Obama didn't live up to your expectations, you ought to go a bit easier on the poor guy. He can tinker at the margins, and he can probably resist the bad advice of those who'd like to get us into a few more wars (e.g., Iran), but he's not in a position to engineer a more thorough reassessment of our global strategy. Change will eventually come -- especially if the U.S. economy doesn't turn around and major deficits persist -- but it will be a slow and grinding process and an awful lot of money and more than a few lives will get wasted before we get there.
But don't lose hope entirely. As I often remind myself, it could have been a lot worse.
Stephen M. Walt
Over the past twenty months, progressives, realists, and even some sensible conservatives have been disappointed by various aspects of the Obama administration's foreign and defense policy. Convinced that his election would mark a dramatic departure from the Bush administration's many missteps, they have been surprised and dismayed by Obama's increased reliance on drone attacks in Pakistan and elsewhere, his decisions to escalate the war in Afghanistan (not just once but twice), the retreat on Guantanamo, the Justice Department's use of dubious secrecy laws to shield torturers and deny victims the ability to sue them, the slow-motion reassessment of "Don't Ask, Don't Tell," the timid retreat from the lofty principles enunciated in his 2009 Cairo speech, and the unwillingness to consider anything more than trivial reductions in the bloated national security apparatus.
I share many of these concerns, but I don't really blame Obama. The buck may stop in the Oval Office, but it's not like he can simply wave a magic wand (or give another speech) and get the rest of the government to fall into line. Instead, the fact that U.S. foreign and defense policy hasn't changed very much reflects the powerful structural forces that inhibit any president's freedom of action. Or to put it more simply: he's trapped. Even if Obama wanted to chart a fundamentally different course (and I'm not at all sure that he does), he wouldn't be able to pull it off.
The first obstacle is America's current global position. Over the past sixty years, the United States built up a vast array of global military facilities, security partnerships, and overseas commitments. In the process, the United States ended up with the responsibility of providing a lot of collective goods (freedom of the seas, regional stability in Europe and Asia, security of global oil supplies, etc.) and it also ended up with a flock of client states who depend on us for various forms of economic, military, and diplomatic support.
These arrangements arose primarily due to the Cold War, but instead of dismantling them when the Cold War ended and returning to a more sensible and restrained grand strategy, the United States instead chose to expand its global responsibilities even further. This was partly because we didn't foresee any real opposition: as George H. W. Bush put it, we found ourselves "at the pinnacle of power, with the rarest opportunity to reshape the world." Hubris played a role too: U.S. leaders convinced themselves that we had the will and the skill to manage vast areas of the globe. Or as Secretary of State Madeleine Albright famously put it, the United States was the "indispensable nation" and that the U.S. "sees further than other countries into the future." And it was also because we thought that we could embed other countries into a set of rules and institutions that were largely of U.S. design. As Richard Haass, former director of policy planning and now president of the Council on Foreign Relations, declared in 2002, the goal was to integrate other countries "into arrangements that will sustain a world consistent with U.S. interests and values and thereby promote peace, prosperity, and justice."
So the United States expanded NATO deep into eastern Europe, adopted the foolish strategy of "dual containment" in the Persian Gulf, invaded Iraq in 2003 in a misguided attempt to transform the Middle East by force, and then got itself bogged down in a costly and ill-conceived effort at nation-building in Afghanistan. U.S. military forces remain deeply engaged on every continent, and as the Washington Post recently documented, the "war on terror" has led to a vast expansion in secret intelligence activities -- much of it conducted by a shadowy network of private contractors -- the scope of which is not even fully understood by the civilians who are allegedly in charge.
It is increasingly obvious that the United States has taken on a set of missions that it is not very good at, and that it cannot afford to continue without hollowing out its power here at home. It's also likely that some of these commitments are eventually going to go south (i.e., whenever we are propping up governments that lack popular support or that are pursuing policies that the rest of the world regards as wrong). The problem Obama faces, however, is that it would be neither easy nor cost-free to liquidate these commitments quickly. This is essentially a variation of the familiar "hegemon's dilemma": having occupied a position of primacy and taken on a vast array of global responsibilities, trying to disengage from them is like dismounting from a tiger. Once you begin to disengage, you may invite some short-term instability that actually makes things look worse. Moreover, any attempt to shift U.S. burdens onto others or to make significant cuts in our defense expenditures is bound to invite fierce opposition from the GOP, who would be quick to paint Obama as a cowardly or feckless appeaser. Instead of a long-overdue rethinking of U.S. strategy, therefore, we have a continuation of the status quo and an attempt to muddle through with our fingers firmly crossed.
The second impediment to change is the foreign policy establishment itself. As I've discussed before, the balance of political power inside Washington is heavily weighted towards the energetic use of American power -- and especially military power -- in virtually every corner of the world. Although think-tank denizens at Brookings, AEI, Heritage, and the Council on Foreign Relations sometimes disagree about specific policy initiatives, the vast majority are enthusiastic defenders of America's dominant global role. Hardly anyone at these institutions strays outside a rather narrow spectrum of thought, or questions the inherent legitimacy of the United States intervening just about anywhere it wants, even if the predictable results are the deaths of thousands of innocent civilians.
For the most part, debates within mainstream foreign policy circles run the gamut from A to B, from neoconservativism at one end and hawkish liberal interventionism at the other. As I said a few years ago, if neocons are essentially liberals on steroids, then most liberal internationalists are just kinder, gentler neocons. They agree on the virtues of American primacy, the need to prevent WMD from spreading (while keeping most of our own), the desirability of spreading democracy nearly everywhere, and the value of nearly all of the United States' current alliances. The only issue where neocons and liberals part company is the role of global institutions (neocons see them as dangerous constraints on U.S. autonomy, while liberals see them as useful supplements to American power). Given this basically bipartisan consensus, it is hardly surprising that most of the senior officials in Obama's foreign policy team were open supporters of the Iraq War, as well as steadfast believers in the United States right to intervene wherever and however it sees fit.
Ambitious foreign policy wonks understand that straying outside that comfortable consensus isn't going to advance their careers. That is why even sensible moderates have to polish their hawkish credentials if they want to be taken seriously, and even experienced pillars of the establishment are not immune from this same tendency. For example, the former president of the Council on Foreign Relations, Leslie Gelb, has admitted that he supported the Iraq War in 2003 in part to maintain his own bona fides within the establishment. In his words, "my initial support for the war [in Iraq] was symptomatic of unfortunate tendencies within the foreign policy community, namely the disposition and incentives to support wars to retain political and professional credibility" (emphasis added). And given that Gelb acted this way even though he was on the brink of retirement, you can imagine how more powerful this incentive is for someone starting out their career.
Finally, Obama clearly understands that the U.S. military has become a very powerful institution in American society, and that he doesn't have the personal background or clout to take them on directly. This situation helps us understand why he's gone slow on DADT, why he couldn't say no to their requests for more troops in Afghanistan, and why the Pentagon budget will continue to rise despite our massive budget woes.
In short, even if Barack Obama wanted to do many of the things that progressives might want, he would face enormous opposition from the uniformed services, the defense corporations who subsidize those conservative think tanks, the array of special interest groups pushing their own particular foreign policy projects, and the legion of hawkish pundits at Fox News, the Weekly Standard, and AM talk radio.
And let's not forget the true wing-nut elements in the American body politic. When both the secretary of Defense and our commanding general in Afghanistan have to waste precious time telling some obscure bigot in Florida that burning the Koran will put U.S. soldiers at greater risk, you know that the people who are allegedly running the country don't have much latitude to explore genuine alternatives.
In short, if you're disappointed that Barack Obama didn't live up to your expectations, you ought to go a bit easier on the poor guy. He can tinker at the margins, and he can probably resist the bad advice of those who'd like to get us into a few more wars (e.g., Iran), but he's not in a position to engineer a more thorough reassessment of our global strategy. Change will eventually come -- especially if the U.S. economy doesn't turn around and major deficits persist -- but it will be a slow and grinding process and an awful lot of money and more than a few lives will get wasted before we get there.
But don't lose hope entirely. As I often remind myself, it could have been a lot worse.
12.9.10
r we fcuk-ed?
Jeremy Horne, Ph.D.
Alamogordo, NM
"President Obama and the Democrats failed to seize the moment...". They didn't? Why am I not surprised? There are two major issues to ponder, here.
First is the very viability of the U.S. corporatist system, itself. Remember that Italian Fascism was a response to a collapsing capitalism; it was a "pragmatic" system that, even with a basic philosophy, was an experiment. Mussolini, himself, wrote that fascists must watch the "Roosevelt experiment" closely. A coherent argument can be made that what F.D.R. did, as necessary as it was, also was an fascist experiment, albeit with an American twist. Robert Gibbs hops about attempting to reach for the butterflies of employment and financial stability, but we should look at how rotten to the core is the corporatist platform on which he stands. U.S. corporatism no longer is sustainable, as it has exported its productive base in the form of outsourcing and has allowed parasitic wealth ("investments", speculation, "derivatives", and the like) to become the foundation of the value of negotiable instruments (including money). As the velocity of capital slows down, no productive engine can start up to generate wealth based on labor power. The house of cards now is collapsing, and a massive public works program, while critically necessary, will not save corporatism in the long run. We have to search for a political economic alternative that is more steady state, cooperatively based, and not dependent just on upon production. As a start, we need to return to the labor theory of value.
Second, people in the U.S. seem to be in a tunnel when it comes to political parties. In logic, we call it "false dilemma", a fallacy as old as the hills. You only can do A or do B. Both parties can look for solutions only within their narrow corporatist ideological (system of ideas not subject to question) framework. Of course, neither party can be expected to break out of the mold, offering nationalization of major industries and banks, socialization of medicine, massive public works projects even larger than those vetted by FDR, or major support for labor organizations and workers' democracy. Systems that remain viable are the ones that can adapt, and this one is not doing well; it is constricted by an ideology of corporatism just as severely as was the former U.S.S.R constricted with its version of communism. Until people start thinking critically and philosophically, at the same time getting educated, we will continue to rattle down the road that other degenerating empires have taken.
Andrew
Colesville, MD
The housing-financial crisis started in 2007 and is ongoing and the real reason has always been lack of investment outlets due to relative overproduction and overcapacity of utilization of means of production. Overproduction is due to lack of effective demand that was the result of stagnated wage levels for the past four decades. Stagnated wage levels created economic stagnation. In addition, the stagnated real economy discouraged investment in real or production economic sector and diverted funds or profits to the non-real or fictitious economy, namely the sector of monopoly finance capital, which manipulates money but does not produce real value for the economy, as we know it. Finance capitalists can mutually redistribute money capitals by changing hands among themselves. In this way, they do not hire workers to produce commodity, so they do not help workers create any value for the society. Unemployment keeps rising with no effective means to reverse the trend.
Because the finance capitalists pass over the labor power or the value creator, their “investment” is not constrained by lack of investment outlets in real economy. The monopoly finance capital makes a lot more money than the real sector. Their profits transferred from the production sector have skyrocketed and weighed in an ever-larger proportion of the G.D.P.
Money capital in the cash form rises to $1.8 trillion in the first quarter of 2010 for the production sector and that for the finance sector may be comparable if not larger. The unduly large combined amount of idled cash waiting for borrowers to take actions lowers down the interest rate. Savers suffer a great deal whereas borrowers including speculators on capital markets gain handsomely. The Federal Reserve has become an Automatic Transaction Machine for the finance capital, which can borrow at almost zero interest rate and turn around making an obscene fortune effortlessly. Under such a thriving way of making easy money, who is going to be interested in hiring workers for production given uncertain return for investment?
President Obama and the Democrats failed to seize the moment on the economy almost two years ago because of the formation of the axis of Geithner-Summers-Bernanke who represent Wall Street interests and care for the most part the perverse interests of monopoly finance capital. This evil axis, while issuing a license to steal to the finance capital, the country is paying the price for Obama, Democrats and Republican’s spinelessness.
The country is in a state of decline because the monopoly finance capital has usurped the power of the nation-state and governments.
Once the monopoly finance capital has grown to such a big size that their influences have been as large as to enable private nations inside a public nation-state, no regulation and reform will change their business-as- usual nature based on willful and instinctive capital accumulation that do great harm to society. The leopard cannot change his spots, no matter how daring one tries.
There are many reasons why we have to transform the monopoly economy into a public-owned people’s economy. The most important two of them are:
1. Modern-day industries such as petroleum do not serve the society as before; they actually serve the monopoly finance capital for most of their purposes. Industrial capital becomes subservient to the finance capital. Since the monopoly finance capital is the sole owner of the government and of the nation-state, the consumption market of people loses their control power of the economy out to the finance monopoly.
2. Capital and environmental calamity rescue and ecological sustainability are mutually antagonistic. Development of monopoly capitalism means unsustainable growth and any sustainable green energy development policy will be impossible under the for-private-profit system unless people concede major portion of their real income to the monopoly capital.
The current system is an obstacle to the progresses of the society and barrier to the production force. Its political design is so woefully out-of-date that reform alone is of no use to societal survival, because the economic infrastructure or the for-private-profit social relation of production is hopeless anathematic to the needs of people and nature.
We need a direct democratic system replacing the current inept faux democratic system to fight now seemingly unbeatable foe of nationalization.
Alamogordo, NM
"President Obama and the Democrats failed to seize the moment...". They didn't? Why am I not surprised? There are two major issues to ponder, here.
First is the very viability of the U.S. corporatist system, itself. Remember that Italian Fascism was a response to a collapsing capitalism; it was a "pragmatic" system that, even with a basic philosophy, was an experiment. Mussolini, himself, wrote that fascists must watch the "Roosevelt experiment" closely. A coherent argument can be made that what F.D.R. did, as necessary as it was, also was an fascist experiment, albeit with an American twist. Robert Gibbs hops about attempting to reach for the butterflies of employment and financial stability, but we should look at how rotten to the core is the corporatist platform on which he stands. U.S. corporatism no longer is sustainable, as it has exported its productive base in the form of outsourcing and has allowed parasitic wealth ("investments", speculation, "derivatives", and the like) to become the foundation of the value of negotiable instruments (including money). As the velocity of capital slows down, no productive engine can start up to generate wealth based on labor power. The house of cards now is collapsing, and a massive public works program, while critically necessary, will not save corporatism in the long run. We have to search for a political economic alternative that is more steady state, cooperatively based, and not dependent just on upon production. As a start, we need to return to the labor theory of value.
Second, people in the U.S. seem to be in a tunnel when it comes to political parties. In logic, we call it "false dilemma", a fallacy as old as the hills. You only can do A or do B. Both parties can look for solutions only within their narrow corporatist ideological (system of ideas not subject to question) framework. Of course, neither party can be expected to break out of the mold, offering nationalization of major industries and banks, socialization of medicine, massive public works projects even larger than those vetted by FDR, or major support for labor organizations and workers' democracy. Systems that remain viable are the ones that can adapt, and this one is not doing well; it is constricted by an ideology of corporatism just as severely as was the former U.S.S.R constricted with its version of communism. Until people start thinking critically and philosophically, at the same time getting educated, we will continue to rattle down the road that other degenerating empires have taken.
Andrew
Colesville, MD
The housing-financial crisis started in 2007 and is ongoing and the real reason has always been lack of investment outlets due to relative overproduction and overcapacity of utilization of means of production. Overproduction is due to lack of effective demand that was the result of stagnated wage levels for the past four decades. Stagnated wage levels created economic stagnation. In addition, the stagnated real economy discouraged investment in real or production economic sector and diverted funds or profits to the non-real or fictitious economy, namely the sector of monopoly finance capital, which manipulates money but does not produce real value for the economy, as we know it. Finance capitalists can mutually redistribute money capitals by changing hands among themselves. In this way, they do not hire workers to produce commodity, so they do not help workers create any value for the society. Unemployment keeps rising with no effective means to reverse the trend.
Because the finance capitalists pass over the labor power or the value creator, their “investment” is not constrained by lack of investment outlets in real economy. The monopoly finance capital makes a lot more money than the real sector. Their profits transferred from the production sector have skyrocketed and weighed in an ever-larger proportion of the G.D.P.
Money capital in the cash form rises to $1.8 trillion in the first quarter of 2010 for the production sector and that for the finance sector may be comparable if not larger. The unduly large combined amount of idled cash waiting for borrowers to take actions lowers down the interest rate. Savers suffer a great deal whereas borrowers including speculators on capital markets gain handsomely. The Federal Reserve has become an Automatic Transaction Machine for the finance capital, which can borrow at almost zero interest rate and turn around making an obscene fortune effortlessly. Under such a thriving way of making easy money, who is going to be interested in hiring workers for production given uncertain return for investment?
President Obama and the Democrats failed to seize the moment on the economy almost two years ago because of the formation of the axis of Geithner-Summers-Bernanke who represent Wall Street interests and care for the most part the perverse interests of monopoly finance capital. This evil axis, while issuing a license to steal to the finance capital, the country is paying the price for Obama, Democrats and Republican’s spinelessness.
The country is in a state of decline because the monopoly finance capital has usurped the power of the nation-state and governments.
Once the monopoly finance capital has grown to such a big size that their influences have been as large as to enable private nations inside a public nation-state, no regulation and reform will change their business-as- usual nature based on willful and instinctive capital accumulation that do great harm to society. The leopard cannot change his spots, no matter how daring one tries.
There are many reasons why we have to transform the monopoly economy into a public-owned people’s economy. The most important two of them are:
1. Modern-day industries such as petroleum do not serve the society as before; they actually serve the monopoly finance capital for most of their purposes. Industrial capital becomes subservient to the finance capital. Since the monopoly finance capital is the sole owner of the government and of the nation-state, the consumption market of people loses their control power of the economy out to the finance monopoly.
2. Capital and environmental calamity rescue and ecological sustainability are mutually antagonistic. Development of monopoly capitalism means unsustainable growth and any sustainable green energy development policy will be impossible under the for-private-profit system unless people concede major portion of their real income to the monopoly capital.
The current system is an obstacle to the progresses of the society and barrier to the production force. Its political design is so woefully out-of-date that reform alone is of no use to societal survival, because the economic infrastructure or the for-private-profit social relation of production is hopeless anathematic to the needs of people and nature.
We need a direct democratic system replacing the current inept faux democratic system to fight now seemingly unbeatable foe of nationalization.
Loosers: The Dems or Us?
Robert Henry Eller
Milan, Italy
'... whether “he understands the problems of people like you.”'
Apparently, not.
President Obama's one big mistake: He has never understood why people voted for him. And if he did understand why people had voted for him, he ignored it. He thought he knew better than his true constituents; He was, I hate to say, arrogant.
The people who voted for him did want him to change things, to save them. But as desperate as they were for bottom up help (health care reform, economic stimulus), what they truly wanted to see was top down change. In fact, they saw electing President Obama as the first evidence that they might get top down change. If they had seen real evidence that Obama, and the Democrats, were going to end business-as-usual, or at least fight tooth-and-nail to end business as usual, in Washington, on Wall Street, I believe the President's supporters would have kept faith. His supporters understood the depths of the problems, and how long it would take to solve them. Why else did he think they voted for him in the first place?
Obama's supporters understood that we'd gotten to where we were because of the ways things were done. We could not ameliorate the effects, and ignore the causes. The last thing the President should have been worrying about was bi-partisanship and reconciliation. He should have set out immediately to do his voters bidding. He should have left it to the Republicans themselves, to decide whether they wanted to be bi-partisan or conciliate. It is for the losers to sue for peace, not for the winners.
The corollary: He apparently never understood that the people who voted against him did not simply conclude that he was the second best choice. After eight years of Bush-Cheney-Rove and the Republicans, after Iraq, Afghanistan, Katrina, the economic and financial meltdown, anybody who would vote for McCain-Palin and the Republicans was not going to vote for Barack Hussein Obama under any circumstances, or against any other candidate, period. And they were not going to give him the benefit of the doubt if he was elected, by any majority however clear.
President Obama never understood that his election was only the first battle, fortunately and expensively won, at the beginning of a war. It was not the battle that ended the war. But that is how he apparently saw it, as the end of the war. Why else would he have allowed the DNC and Rahm Emanuel to co-opt, de-claw and de-fang his peerless and unprecedented grass roots campaign legions?
Obama's supporters were, largely, equally adamant that, after the primaries, he was not the better choice. He was the only choice. The President, the leader, ironically never understood, or felt, what his troops, knew: They were at war.
I myself did not contribute every dollar I could spare, and more than I could afford, just because I thought Obama would make a better President than McCain. I gave as though my country was at war. McCain and the Republicans were not just incompetent, not just a disaster. They were indeed the enemy.
The only possible way President Obama, and the Democrats, might now recover, starting today, and assuming he can recognize, and acknowledge, these strategic mistakes, is to convince the people who supported him that he understands he was wrong and why. He could fire Summers and Geitner. He could encourage Emanuel to run for Mayor of Chicago. He could empower Elizabeth Warren. He could attack the Republicans as he should. He could get the Attorney General to start investigating Cheney. He could become a real war President, in the only war the US is currently fighting whose outcome matters for America: the war the army of his voters thought he was leading us to fight.
I know I'm probably just dreaming. But this is the dream the majority of us had almost two years ago this November. The dream we thought had come true. And it's still the only dream I'm willing to fight for. If President Obama can convince enough of us that he believes in this dream, that he will fight for this dream, then perhaps he can regain the support of those of us who once thought he understood us.
Fred Drumlevitch
Tucson, Arizona
This November, I will hold my nose and vote for all Democrats --- not because they deserve my vote, but simply because the alternative is so much worse, an incoherent mob of apologists for personal selfishness and the rich manipulators who, despite their "patriotic" camouflage, are actually working against the greater interests of the nation.
The Democratic Party as a whole, and most Democratic politicians as individuals, should be embarrassed by the way in which they have in so many policy matters managed to snatch defeat from the jaws of victory. They were elected in a time of crisis to pass and implement bold transformative measures, to be done in the spirit of Great Depression progressivism. They haven't delivered even one-tenth of what they should have. It will be up to historians to definitively determine whether that was due to political inexperience, wishful thinking, a deficit of courage, incompetence, or the corrupting influence of campaign donations. Most likely, it was all of the above, and more.
I will hold my nose as I vote for Democrats this election cycle, and give them one more chance to redeem themselves. If no significant improvement in Democratic policy stands occurs during the next two years, in 2012 I will support a new progressive party that is bound to emerge from the probable ashes of the current Democratic one.
Marie Burns
Fort Myers, Florida
Yes to all that. But there are other shadows hanging over the President, shadows of his own making. One is Afghanistan. Another is the President's continuation of Bush secrecy policies & his massive cover-up of Bush Administration wrongdoing. He won a big one in court on the latter this week.
An actual liberal, like me, wants to see Obama come out strongly for returning Americans to work & protecting all of us from special interests. So of course if he follows your playscript, I'll be glad of it. But I'm not sure how much Obama's saying the right -- and obvious -- thing on socioeconomic issues would drive up my enthusiasm quotient. I still know there are Americans & Afghans dying for Hamid Karzai.
Maybe that doesn't matter. I'm going to vote, & Republican obstructionists have forced me to vote Democratic all the way, even when the Democrat might not be the better candidate. A Floridian, I haven't made up my mind yet on Meek-Crist as to who is the better candidate, but be assured Kendrick Meek, the Democrat, has my vote. He can thank Mitch McConnell for that.
It's the independents Obama must reach. Everyone, including me, calls them independents, but that's really a nice name for clueless & distracted. President Obama can certainly see to it that they forget all about the war & secret renditions & Bush's bad boys. He just has to Keep It Simple, Stupid, when he explains that he cares about Middle America's future & John Boehner & Mitch McConnell only care about their own.
The Constant Weader at www.RealityChex.com
Sheri
TN
Not in a million years would I thought I'd utter the following phrase, but NOW is the time for Americans to "stay the course."
Obama will NOT be able to right thirty-year-old wrongs even as a two-term president; no one could. I voted for him not because I thought he was a miracle worker, but because I was confident in the groundwork he promised - and I still am.
Come on, liberals, enough with the "this isn't the change I voted for" whining. What you voted for was a corrective, and it has been presented, and well. The fruits of it are yet to come, but they won't do so if all you do is complain. Obama can't do it alone, nor should he.
So, liberals, GET UP, GO OUT, AND HELP IN WHATEVER WAY YOU CAN - because that is where the hope and change will come from: us.
Barbara Taylor
Charlotte, NC
Yes, it's long past time for Obama to clear up the confusion as to which side he is on.
FDR, he isn't. But maybe he can redeem himself as something less than another corporate-politician-for-hire if he keeps up the tough rhetoric but backs it up with action. Talk is cheap. We don't care what he says or even thinks, because we believed in that in 2008 and look what it got us. The only thing that will get us behind him again is action, tough action with real leadership in getting things done.
If he sits in the background and delegates everything to Pelosi and Reid while it falls apart, whines, and says it's hard, like he did with health care and other initiatives, we'll give up on him. But if he really tries and fails to move a more middle-class oriented agenda in the face of Republican obstructionism, we'll stay with him as long as he fights the good fight.
Tim Kane
Mesa, Arizona
Obama can't credibly speak out on behalf of the middle class at this late date, if ever, to minimize the outcome of the coming elections.
The fact is, we've all noticed Obama's considerable talents. The fact is, he's only exercised them with vigor when his own employment scenario was in question.
We all expected Obama to co-opt FDR. The Republican Party hasn't changed in over 80 years and the current depression was born on the backs of the same Republican party, exercising policies that caused the same problem, concentration of wealth, leading to the same outcome then and now. It's all the same, except the script was already laid out, thankfully, by Roosevelt.
The fact is, after Obama won the election, with his OWN EMPLOYMENT SECURED, he was happy to 'phone it in' for 'half loaf' measures. Specifically: he (easily) foresee-ably accepted a stimulus that was inadequate, by at least a third, and was happy to throw public option under the bus (after talking Democrats into trading down to it from single payer).
In short Obama's lack of vigor on behalf of the middle class is the biggest political disappointment since the Supreme Court appointed George Bush president.
About keeping his job, it is painfully obvious, Obama cares. About helping the middle class, Obama can't get invigorated.
What is motivating Obama now is the threat of a Republican congress, with subpoena power, plus the power to impeach. In that light, Obama's belated, most craven populism, is a gross and rank embarrassment.
Obama reminds me of a high school wannabe - from an ordinary background, but who wants to be in with the cool kids, or in his case, the BigMoney elite types. As a result he's been friendly to their asperations, in many cases surrendering to them, only to find out that he'll never be accepted. I'm sure the rejection stings.
So, it's back to the green that he's come from. Ordinarily, we would reject him for a true advocate. But now, we are desperate and we have two more years before we can exercise any choice at all - so we are stuck with him for the indefinite future.
Obama, therefore, has an opportunity to earn his way into the favor of the middle class. But it will take two years of intense advocacy on behalf of the populism and middle class for it to look believable and that he means it.
More likely, two weeks after the coming election, come what may, Obama will go back to half loaves and to phoning it in.
The Obama administration is the biggest public disappointment I've ever experienced in my entire, half century'd, life - and by an enormous margin.
I expected George Bush to be a massive catastrophe, and he lived up to that. I'm not sure which is the bigger catastrophe: the failure of the Bush administration or the failure of the Obama administration to reverse course.
One thing is certain, if our political system is incapable of solving our growing list of catastrophic problems, because our richest citizens and our elites won't allow for it, this nation will collapse at a rate that will stun the entire world.
It is also a tragedy that we have a wealthy upper class that is willing to trash the nation. Not just willing, but willing to pay massive amounts of money, build giant media empires, endow rogue religions and preachers, to see that its done.
In normal times Obama would be a decent president. These aren't normal times.
In these times, Obama is merely inadequate.
Beguiling considering the talent he's demonstrated in the past.
Cdr. John Newlin
Vista, Calif.
Another very revealing statistic that the President might put in his quiver is the chart featured on Friday's Rachel Maddow show. That chart showed income growth rates from 1948 to 2005 with a vertical axis of percentile income and a horizontal axis of income growth rates. The growth rates under Republican Presidents and Democratic presidents were displayed by red and blue bars respectively. The chart dramatically shows that in every Republican presidency, income growth rate was significantly less than in yeas of Democratic presidencies. The president ought to haul out that chart everywhere he goes. It's a real windjammer to the breadbasket of supply side Republicans.
Another chart that ought to be jammed down the Plutocrat's throats is the pie chart that depicts the amount of income growth for various groups over the period from 1979 to 2007. This chart shows that the growth for the top 10% of income earners was a wopping 63.7%! How did the bottom 90% do over the same period? A pathetic 36.3%. As Edith Ann was wont to say, "And that's the truth."
Jake Wagner
Santa Barbara, CA
Perhaps no more telling indictment of Obama's priorities is revealed in the choices his Justice Department has made in which legal cases to prosecute.
We witnessed a CEO Richard Fuld of Lehman Brothers walking away with compensation of about a half billion dollars in the decade leading up to the bankruptcy of his company. One of the architects of the exotic CDO's that helped wipe out trillions of US wealth, he systematically misled the stockholders of his company and government regulators about the economic health of his company. It is still not clear what his role was in the infamous Repo 105 accounting gimmicks, but here there is at least the appearance of systematic criminal fraud.
Yet Richard Fuld has yet to be indicted for any criminal activity.
Instead, Obama's Justice Department goes after an admittedly flawed attempt by Arizona's government to deal with one of the federal government's failures, the inability to enforce US border laws regarding immigration. It has been estimated that US population growth of .9% per year during the past decade is largely attributable to illegal immigration and the higher fertility of illegal immigrants who gain access to US welfare benefits through their children, who automatically become US citizens.
That population growth has added 28 million new US residents in the last decade or 230,000 new residents each month. Compare that with the number of new jobs the US economy is producing each month!
Consider the message Obama sends to the unskilled or semiskilled workers who might make up a substantial portion of his base: "I won't prosecute the Wall Street titans that defrauded your pension funds, but I will do everything in my power to block efforts of a governor to enforce the federal immigration laws that should protect your jobs." Then you can perhaps understand why so many of the unwashed working class gravitate to something other than Obama.
Todd Fox
Connecticut
The other night at a country fair I spoke with a woman who had just lost her job with the town. She said "I'll just get another one—when I'm ready." After looking myself, for nearly two years, I wondered if this would be easier said than done—especially since we are both women "of a certain age". (Actually I think we might be well past that rather nebulous age.) She said "Oh, I've already been offered a job, but I turned it down. The benefits weren't as good as the ones I had. So why should I take it when I have 99 weeks of unemployment coming to me?" Coming to me. That's how she viewed it—not as a handout but as something coming to her.
Then there are people like my husband—a hero as far as I'm concerned. He's working for 1/3 of his former salary, and still putting in the exact same effort—out of a sense of responsibility to "get the job done" and a strong work ethic.
The Democrats would have us believe that everyone who is taking "extended unemployment" benefits is in dire straits and desperately looking for a job—any job. The Republicans would have us believe that they are all free-loaders. Somewhere between the two lies the truth.
I think that's the problem: the truth lies in between the politics and the politicians. The Republicans would have us believe that the founding fathers are rolling in their graves and that the Democrats are know-nothing commie bastids. The Democrats describe the tea-party as uneducated "old people" who are under a spell woven by FOX. Both sides do not listen to one another—even though there is truth and wisdom coming from the sane people in either party.
Obama campaigned as someone who could bring us all back together, but sadly, he's playing the divisiveness game as much as all the others. If there is ONE thing I wish I would see him do, it would be to stop the divisiveness, stop the class warfare, stop the inflammatory rhetoric about the wealthy, and stop blaming his predecessor.
Tell us what YOU can do now, Mr. Obama. Please, please set an example of compassionate listening and understanding. In short—lead.
Andrew
Colesville, MD
I do not think Obama can emulate F.D.R.
His political environment is worse than F.D.R’s. The capitalist class has entered its zenith of bourgeois power dictatorship over the working people for the past three decades. They have easily quelled any nascent political progressiveness, let alone shifting away from far rightist policies. Weak working class power gives rise to weak policy changing possibility. This is why Obama gave up meaningful changes for people’s betterment for more than one and half years since he took the office of presidency.
As Wall Street has claimed supreme politico-economic power of the capitalist orders, even smidgen trivial matters have to get Wall Street’s approval. People have severely criticized the Wall Street axis of Greithner-Summers-Bernanke for malfeasance and have requested Obama to break up the axis and dismiss them but Obama refused to do so for the power that hijacked the government is Wall Street or the monopoly finance capital.
F.D.R came from a wealthy aristocratic family and he had no need to be avid of the capitalists’ rightist favor for money and connections. He could afford to declare that he welcomed the “hatred” of his enemies in the realms of “business and financial monopoly, speculation, reckless banking, class antagonism, sectionalism, war profiteering.” Obama’s family origin is completely different. His family was of moderate means. His official career and personal advancement have usually under the rich capitalists thumb. F.D.R could not careless about of the hatred of his enemies but Obama cannot afford to neglect the hatred of his. Because, in such a deeply commodified society, even the highest officer in the country has to obey rules of selling and buying, wheeling and dealing, set up by the top-drawers to whom one would have to be much obliged, especially if one is timorous and giddily tending to blandish those on top of social and official ladders.
The U.S. electoral democratic system has shown its fatal drawbacks from the Reagan era to the present. Democracy has become timocracy that the electorates are so timorous and bereft after losing control that they literally hold power for only one day annually and give the rest to capitalists who wield power for them all year round. The grass-root movement to elect a president for change actually elected Wall Street for non-change.
The representative democracy has failed. The struggle for an utterly new direct democratic system bypassing the capitalist plutocracy power route will transform the political system from timocracy or plutocracy to people’s democracy.
chaotician
New Mexico
Andrew Carnegie is famous for picking Good Men to do the work which made him wealthy; his job he said was to make this men work together for achieving the goals of each of them so that all were successful! Barry has failed very badly in picking men and women! He has surrounded himself with Clinton retreads; and retained many of George's selections in some mistaken notion that doing so would get some support from the Republicans! Well, his choices of Summers and Geithner have been abysmal failures, his choice for Homeland insecurity the worse pick possible, and his choices for Interior, Environment, and most of the rest are poor at best; Of course, he has had to put up with the party of No; but a daily barrage of publicity on the appointments not getting done would have sent the cowardly Republicans back in their holes! That is one of the deepest disappointments; letting the Senate be a place where things are prevented from happening; and the Democrats have all the blame for allowing this to continue because these corrupted men and women would rather keep their exalted privileges, their "royal" prerogatives, their arcane rules, their bribes and kickbacks than do what is necessary to govern the country! Well, the Republicans have been successful; they have prevented the nation's business to be done; they have allowed a minority of the Senators to block votes, block appointments, block and water down needed actions; they have made a mockery of the people's votes to make change and they will pay the price! They will be held responsible for the coming disaster of the Republican resurgence; they will be the cowards which allowed the reactionary corporate Fascist, the reactionary Christian Right thugs, the discredited economic actions, the impoverishing trade policies, the ruinous, stupid foreign wars, and the insidious attacks on the social policies supporting our nation to continue! When the guillotines are brought forth after the coming years of economic slavery; may their heads be the first to go!
ed connor
camp springs, md
Yes, thge top 1% earn 21% of all income. They also pay 42% of all income taxes.
The bottom 47% pay NO income taxes.
Most mothers now give birth without fathers in the home. Nearly 50% of urban high school students drop out before graduation. The U.S. has slipped from first to 16th internationally in rates of college matriculation. Most foreclosures are made upon homeowners who took out "interest free" loans and never had any equity in the foreclosed properties. There are 12 million illegal residents in the U.S. who are unskilled and uneducated, and who are stressing local health care and education recources to the limit.
Did I mention that 90% of Americans ARE employed and housed?
Why you continue to blame the people who studied hard, paid off their college loans, worked their way up through their professions, and finally reached their peak earning years, befuddles me.
If you repeal the Bush tax cuts for only incomes over $250 K but maintain the cuts under that income level, you will only reduce the net revenue loss by 25%. There are only so many "rich" people to soak. Once soaked, we will retire, stop hiring and go away.
Who will you blame for your misfortunes then?
kathleenkatalina
Massachusetts
Americans get their news from multi-millionaires....Wolf, Charlie, Rush. None of the talking heads make less than 1/4 million a year, and none of them think they are rich.
Oprah, Warren Buffet, that Russian guy, they're rich. The talking heads are just middle class folks who make 5 or 6 million a year. And they have been baling up the Benjamins for the last ten years of tax cuts. Millions. Follow the money.
TV news, including MSNBC, keeps telling us that Obama is going to raise our taxes, but they really mean he is going to raise theirs.
The country is broke because of lies and incompetence, and all patriotic Americans need to sacrifice.
Just as the sons and daughters of the real middle class sacrificed when they volunteered for duty when Bush invaded the wrong country. The comfortable class has benefitted from our capitalist democracy, and they have not had to sacrifice. They have paid high taxes, but it has not hurt. Not the way it hurts the people I know.
They stand in line waiting to buy a few items. They dont use shopping carts. And after they add up to see if they have enough money , they are hit with a sales tax. On food. On the clothes and books the kids need. On gas.
My sister is 58, worked every day of her life, even during college, and she predicts that she will finally be out of debt in October. Then she can start saving for retirement. She had one child, not a dozen. And a husband.
Some people who are very well off have worked very hard, but so has every poor person. The rich have been lucky, and they need to stop being so selfish.
My favorite president needs to shame them into making the sacrifice.
If President Obama announced tomorrow that he was not going to stop their tax breaks, he would all of a sudden be very very popular. Follow the money...
Sandy Lewis
Lewis Family Farm, Essex, New York
FDR's predicament was different. FDR had not hired Bob Rubin, or Sidney Weinberg, for that matter, nor had he put Steve Rattner, arguably a criminal not charged by his administration, in charge of Detroit, only to remove him when news of his previous life emerged.
As and when news of Bob Rubin's previous life emerges, will the president remove his team?
Geithner was not smart enough to work at Goldman, Sachs, but he did the next best thing for one who would like to work there: he followed Goldman's line and worked to please Goldman, 24-7. There is no difference between Hank's team and Geithner's team, save one: Hank got the guys he wanted, and Tim Geithner can get no one to come.
Smart, honest guys do not want to work for Rubin in absentia. With Valerie Jarrett running things from behind the Oval Office, we have Larry and Tim and Valerie as the triumvirate under Caesar. And Bob Rubin is tight with Valerie, believe it. I got that from on high.
Hence, this Obama administration is really Rubin & Company. That's what we have here. Which wold work if they knew how to shoot straight.
No, it's late in the game to play the FDR 1936 Card. Save that one for 2012, when all the cards needed will have to be played.
For now, it would do to "out" them that caused it - and let the people know you know. The problem, Frank, among others - people think he doesn't get it.
And to date, it's clear the President Obama does not really, really get it. He's surrounded.
And those who have surrounded President Obama have the best insurance policy in the world in President Obama.
If the ---- hits he fan, big time, who will explain why He hired Them?
Milan, Italy
'... whether “he understands the problems of people like you.”'
Apparently, not.
President Obama's one big mistake: He has never understood why people voted for him. And if he did understand why people had voted for him, he ignored it. He thought he knew better than his true constituents; He was, I hate to say, arrogant.
The people who voted for him did want him to change things, to save them. But as desperate as they were for bottom up help (health care reform, economic stimulus), what they truly wanted to see was top down change. In fact, they saw electing President Obama as the first evidence that they might get top down change. If they had seen real evidence that Obama, and the Democrats, were going to end business-as-usual, or at least fight tooth-and-nail to end business as usual, in Washington, on Wall Street, I believe the President's supporters would have kept faith. His supporters understood the depths of the problems, and how long it would take to solve them. Why else did he think they voted for him in the first place?
Obama's supporters understood that we'd gotten to where we were because of the ways things were done. We could not ameliorate the effects, and ignore the causes. The last thing the President should have been worrying about was bi-partisanship and reconciliation. He should have set out immediately to do his voters bidding. He should have left it to the Republicans themselves, to decide whether they wanted to be bi-partisan or conciliate. It is for the losers to sue for peace, not for the winners.
The corollary: He apparently never understood that the people who voted against him did not simply conclude that he was the second best choice. After eight years of Bush-Cheney-Rove and the Republicans, after Iraq, Afghanistan, Katrina, the economic and financial meltdown, anybody who would vote for McCain-Palin and the Republicans was not going to vote for Barack Hussein Obama under any circumstances, or against any other candidate, period. And they were not going to give him the benefit of the doubt if he was elected, by any majority however clear.
President Obama never understood that his election was only the first battle, fortunately and expensively won, at the beginning of a war. It was not the battle that ended the war. But that is how he apparently saw it, as the end of the war. Why else would he have allowed the DNC and Rahm Emanuel to co-opt, de-claw and de-fang his peerless and unprecedented grass roots campaign legions?
Obama's supporters were, largely, equally adamant that, after the primaries, he was not the better choice. He was the only choice. The President, the leader, ironically never understood, or felt, what his troops, knew: They were at war.
I myself did not contribute every dollar I could spare, and more than I could afford, just because I thought Obama would make a better President than McCain. I gave as though my country was at war. McCain and the Republicans were not just incompetent, not just a disaster. They were indeed the enemy.
The only possible way President Obama, and the Democrats, might now recover, starting today, and assuming he can recognize, and acknowledge, these strategic mistakes, is to convince the people who supported him that he understands he was wrong and why. He could fire Summers and Geitner. He could encourage Emanuel to run for Mayor of Chicago. He could empower Elizabeth Warren. He could attack the Republicans as he should. He could get the Attorney General to start investigating Cheney. He could become a real war President, in the only war the US is currently fighting whose outcome matters for America: the war the army of his voters thought he was leading us to fight.
I know I'm probably just dreaming. But this is the dream the majority of us had almost two years ago this November. The dream we thought had come true. And it's still the only dream I'm willing to fight for. If President Obama can convince enough of us that he believes in this dream, that he will fight for this dream, then perhaps he can regain the support of those of us who once thought he understood us.
Fred Drumlevitch
Tucson, Arizona
This November, I will hold my nose and vote for all Democrats --- not because they deserve my vote, but simply because the alternative is so much worse, an incoherent mob of apologists for personal selfishness and the rich manipulators who, despite their "patriotic" camouflage, are actually working against the greater interests of the nation.
The Democratic Party as a whole, and most Democratic politicians as individuals, should be embarrassed by the way in which they have in so many policy matters managed to snatch defeat from the jaws of victory. They were elected in a time of crisis to pass and implement bold transformative measures, to be done in the spirit of Great Depression progressivism. They haven't delivered even one-tenth of what they should have. It will be up to historians to definitively determine whether that was due to political inexperience, wishful thinking, a deficit of courage, incompetence, or the corrupting influence of campaign donations. Most likely, it was all of the above, and more.
I will hold my nose as I vote for Democrats this election cycle, and give them one more chance to redeem themselves. If no significant improvement in Democratic policy stands occurs during the next two years, in 2012 I will support a new progressive party that is bound to emerge from the probable ashes of the current Democratic one.
Marie Burns
Fort Myers, Florida
Yes to all that. But there are other shadows hanging over the President, shadows of his own making. One is Afghanistan. Another is the President's continuation of Bush secrecy policies & his massive cover-up of Bush Administration wrongdoing. He won a big one in court on the latter this week.
An actual liberal, like me, wants to see Obama come out strongly for returning Americans to work & protecting all of us from special interests. So of course if he follows your playscript, I'll be glad of it. But I'm not sure how much Obama's saying the right -- and obvious -- thing on socioeconomic issues would drive up my enthusiasm quotient. I still know there are Americans & Afghans dying for Hamid Karzai.
Maybe that doesn't matter. I'm going to vote, & Republican obstructionists have forced me to vote Democratic all the way, even when the Democrat might not be the better candidate. A Floridian, I haven't made up my mind yet on Meek-Crist as to who is the better candidate, but be assured Kendrick Meek, the Democrat, has my vote. He can thank Mitch McConnell for that.
It's the independents Obama must reach. Everyone, including me, calls them independents, but that's really a nice name for clueless & distracted. President Obama can certainly see to it that they forget all about the war & secret renditions & Bush's bad boys. He just has to Keep It Simple, Stupid, when he explains that he cares about Middle America's future & John Boehner & Mitch McConnell only care about their own.
The Constant Weader at www.RealityChex.com
Sheri
TN
Not in a million years would I thought I'd utter the following phrase, but NOW is the time for Americans to "stay the course."
Obama will NOT be able to right thirty-year-old wrongs even as a two-term president; no one could. I voted for him not because I thought he was a miracle worker, but because I was confident in the groundwork he promised - and I still am.
Come on, liberals, enough with the "this isn't the change I voted for" whining. What you voted for was a corrective, and it has been presented, and well. The fruits of it are yet to come, but they won't do so if all you do is complain. Obama can't do it alone, nor should he.
So, liberals, GET UP, GO OUT, AND HELP IN WHATEVER WAY YOU CAN - because that is where the hope and change will come from: us.
Barbara Taylor
Charlotte, NC
Yes, it's long past time for Obama to clear up the confusion as to which side he is on.
FDR, he isn't. But maybe he can redeem himself as something less than another corporate-politician-for-hire if he keeps up the tough rhetoric but backs it up with action. Talk is cheap. We don't care what he says or even thinks, because we believed in that in 2008 and look what it got us. The only thing that will get us behind him again is action, tough action with real leadership in getting things done.
If he sits in the background and delegates everything to Pelosi and Reid while it falls apart, whines, and says it's hard, like he did with health care and other initiatives, we'll give up on him. But if he really tries and fails to move a more middle-class oriented agenda in the face of Republican obstructionism, we'll stay with him as long as he fights the good fight.
Tim Kane
Mesa, Arizona
Obama can't credibly speak out on behalf of the middle class at this late date, if ever, to minimize the outcome of the coming elections.
The fact is, we've all noticed Obama's considerable talents. The fact is, he's only exercised them with vigor when his own employment scenario was in question.
We all expected Obama to co-opt FDR. The Republican Party hasn't changed in over 80 years and the current depression was born on the backs of the same Republican party, exercising policies that caused the same problem, concentration of wealth, leading to the same outcome then and now. It's all the same, except the script was already laid out, thankfully, by Roosevelt.
The fact is, after Obama won the election, with his OWN EMPLOYMENT SECURED, he was happy to 'phone it in' for 'half loaf' measures. Specifically: he (easily) foresee-ably accepted a stimulus that was inadequate, by at least a third, and was happy to throw public option under the bus (after talking Democrats into trading down to it from single payer).
In short Obama's lack of vigor on behalf of the middle class is the biggest political disappointment since the Supreme Court appointed George Bush president.
About keeping his job, it is painfully obvious, Obama cares. About helping the middle class, Obama can't get invigorated.
What is motivating Obama now is the threat of a Republican congress, with subpoena power, plus the power to impeach. In that light, Obama's belated, most craven populism, is a gross and rank embarrassment.
Obama reminds me of a high school wannabe - from an ordinary background, but who wants to be in with the cool kids, or in his case, the BigMoney elite types. As a result he's been friendly to their asperations, in many cases surrendering to them, only to find out that he'll never be accepted. I'm sure the rejection stings.
So, it's back to the green that he's come from. Ordinarily, we would reject him for a true advocate. But now, we are desperate and we have two more years before we can exercise any choice at all - so we are stuck with him for the indefinite future.
Obama, therefore, has an opportunity to earn his way into the favor of the middle class. But it will take two years of intense advocacy on behalf of the populism and middle class for it to look believable and that he means it.
More likely, two weeks after the coming election, come what may, Obama will go back to half loaves and to phoning it in.
The Obama administration is the biggest public disappointment I've ever experienced in my entire, half century'd, life - and by an enormous margin.
I expected George Bush to be a massive catastrophe, and he lived up to that. I'm not sure which is the bigger catastrophe: the failure of the Bush administration or the failure of the Obama administration to reverse course.
One thing is certain, if our political system is incapable of solving our growing list of catastrophic problems, because our richest citizens and our elites won't allow for it, this nation will collapse at a rate that will stun the entire world.
It is also a tragedy that we have a wealthy upper class that is willing to trash the nation. Not just willing, but willing to pay massive amounts of money, build giant media empires, endow rogue religions and preachers, to see that its done.
In normal times Obama would be a decent president. These aren't normal times.
In these times, Obama is merely inadequate.
Beguiling considering the talent he's demonstrated in the past.
Cdr. John Newlin
Vista, Calif.
Another very revealing statistic that the President might put in his quiver is the chart featured on Friday's Rachel Maddow show. That chart showed income growth rates from 1948 to 2005 with a vertical axis of percentile income and a horizontal axis of income growth rates. The growth rates under Republican Presidents and Democratic presidents were displayed by red and blue bars respectively. The chart dramatically shows that in every Republican presidency, income growth rate was significantly less than in yeas of Democratic presidencies. The president ought to haul out that chart everywhere he goes. It's a real windjammer to the breadbasket of supply side Republicans.
Another chart that ought to be jammed down the Plutocrat's throats is the pie chart that depicts the amount of income growth for various groups over the period from 1979 to 2007. This chart shows that the growth for the top 10% of income earners was a wopping 63.7%! How did the bottom 90% do over the same period? A pathetic 36.3%. As Edith Ann was wont to say, "And that's the truth."
Jake Wagner
Santa Barbara, CA
Perhaps no more telling indictment of Obama's priorities is revealed in the choices his Justice Department has made in which legal cases to prosecute.
We witnessed a CEO Richard Fuld of Lehman Brothers walking away with compensation of about a half billion dollars in the decade leading up to the bankruptcy of his company. One of the architects of the exotic CDO's that helped wipe out trillions of US wealth, he systematically misled the stockholders of his company and government regulators about the economic health of his company. It is still not clear what his role was in the infamous Repo 105 accounting gimmicks, but here there is at least the appearance of systematic criminal fraud.
Yet Richard Fuld has yet to be indicted for any criminal activity.
Instead, Obama's Justice Department goes after an admittedly flawed attempt by Arizona's government to deal with one of the federal government's failures, the inability to enforce US border laws regarding immigration. It has been estimated that US population growth of .9% per year during the past decade is largely attributable to illegal immigration and the higher fertility of illegal immigrants who gain access to US welfare benefits through their children, who automatically become US citizens.
That population growth has added 28 million new US residents in the last decade or 230,000 new residents each month. Compare that with the number of new jobs the US economy is producing each month!
Consider the message Obama sends to the unskilled or semiskilled workers who might make up a substantial portion of his base: "I won't prosecute the Wall Street titans that defrauded your pension funds, but I will do everything in my power to block efforts of a governor to enforce the federal immigration laws that should protect your jobs." Then you can perhaps understand why so many of the unwashed working class gravitate to something other than Obama.
Todd Fox
Connecticut
The other night at a country fair I spoke with a woman who had just lost her job with the town. She said "I'll just get another one—when I'm ready." After looking myself, for nearly two years, I wondered if this would be easier said than done—especially since we are both women "of a certain age". (Actually I think we might be well past that rather nebulous age.) She said "Oh, I've already been offered a job, but I turned it down. The benefits weren't as good as the ones I had. So why should I take it when I have 99 weeks of unemployment coming to me?" Coming to me. That's how she viewed it—not as a handout but as something coming to her.
Then there are people like my husband—a hero as far as I'm concerned. He's working for 1/3 of his former salary, and still putting in the exact same effort—out of a sense of responsibility to "get the job done" and a strong work ethic.
The Democrats would have us believe that everyone who is taking "extended unemployment" benefits is in dire straits and desperately looking for a job—any job. The Republicans would have us believe that they are all free-loaders. Somewhere between the two lies the truth.
I think that's the problem: the truth lies in between the politics and the politicians. The Republicans would have us believe that the founding fathers are rolling in their graves and that the Democrats are know-nothing commie bastids. The Democrats describe the tea-party as uneducated "old people" who are under a spell woven by FOX. Both sides do not listen to one another—even though there is truth and wisdom coming from the sane people in either party.
Obama campaigned as someone who could bring us all back together, but sadly, he's playing the divisiveness game as much as all the others. If there is ONE thing I wish I would see him do, it would be to stop the divisiveness, stop the class warfare, stop the inflammatory rhetoric about the wealthy, and stop blaming his predecessor.
Tell us what YOU can do now, Mr. Obama. Please, please set an example of compassionate listening and understanding. In short—lead.
Andrew
Colesville, MD
I do not think Obama can emulate F.D.R.
His political environment is worse than F.D.R’s. The capitalist class has entered its zenith of bourgeois power dictatorship over the working people for the past three decades. They have easily quelled any nascent political progressiveness, let alone shifting away from far rightist policies. Weak working class power gives rise to weak policy changing possibility. This is why Obama gave up meaningful changes for people’s betterment for more than one and half years since he took the office of presidency.
As Wall Street has claimed supreme politico-economic power of the capitalist orders, even smidgen trivial matters have to get Wall Street’s approval. People have severely criticized the Wall Street axis of Greithner-Summers-Bernanke for malfeasance and have requested Obama to break up the axis and dismiss them but Obama refused to do so for the power that hijacked the government is Wall Street or the monopoly finance capital.
F.D.R came from a wealthy aristocratic family and he had no need to be avid of the capitalists’ rightist favor for money and connections. He could afford to declare that he welcomed the “hatred” of his enemies in the realms of “business and financial monopoly, speculation, reckless banking, class antagonism, sectionalism, war profiteering.” Obama’s family origin is completely different. His family was of moderate means. His official career and personal advancement have usually under the rich capitalists thumb. F.D.R could not careless about of the hatred of his enemies but Obama cannot afford to neglect the hatred of his. Because, in such a deeply commodified society, even the highest officer in the country has to obey rules of selling and buying, wheeling and dealing, set up by the top-drawers to whom one would have to be much obliged, especially if one is timorous and giddily tending to blandish those on top of social and official ladders.
The U.S. electoral democratic system has shown its fatal drawbacks from the Reagan era to the present. Democracy has become timocracy that the electorates are so timorous and bereft after losing control that they literally hold power for only one day annually and give the rest to capitalists who wield power for them all year round. The grass-root movement to elect a president for change actually elected Wall Street for non-change.
The representative democracy has failed. The struggle for an utterly new direct democratic system bypassing the capitalist plutocracy power route will transform the political system from timocracy or plutocracy to people’s democracy.
chaotician
New Mexico
Andrew Carnegie is famous for picking Good Men to do the work which made him wealthy; his job he said was to make this men work together for achieving the goals of each of them so that all were successful! Barry has failed very badly in picking men and women! He has surrounded himself with Clinton retreads; and retained many of George's selections in some mistaken notion that doing so would get some support from the Republicans! Well, his choices of Summers and Geithner have been abysmal failures, his choice for Homeland insecurity the worse pick possible, and his choices for Interior, Environment, and most of the rest are poor at best; Of course, he has had to put up with the party of No; but a daily barrage of publicity on the appointments not getting done would have sent the cowardly Republicans back in their holes! That is one of the deepest disappointments; letting the Senate be a place where things are prevented from happening; and the Democrats have all the blame for allowing this to continue because these corrupted men and women would rather keep their exalted privileges, their "royal" prerogatives, their arcane rules, their bribes and kickbacks than do what is necessary to govern the country! Well, the Republicans have been successful; they have prevented the nation's business to be done; they have allowed a minority of the Senators to block votes, block appointments, block and water down needed actions; they have made a mockery of the people's votes to make change and they will pay the price! They will be held responsible for the coming disaster of the Republican resurgence; they will be the cowards which allowed the reactionary corporate Fascist, the reactionary Christian Right thugs, the discredited economic actions, the impoverishing trade policies, the ruinous, stupid foreign wars, and the insidious attacks on the social policies supporting our nation to continue! When the guillotines are brought forth after the coming years of economic slavery; may their heads be the first to go!
ed connor
camp springs, md
Yes, thge top 1% earn 21% of all income. They also pay 42% of all income taxes.
The bottom 47% pay NO income taxes.
Most mothers now give birth without fathers in the home. Nearly 50% of urban high school students drop out before graduation. The U.S. has slipped from first to 16th internationally in rates of college matriculation. Most foreclosures are made upon homeowners who took out "interest free" loans and never had any equity in the foreclosed properties. There are 12 million illegal residents in the U.S. who are unskilled and uneducated, and who are stressing local health care and education recources to the limit.
Did I mention that 90% of Americans ARE employed and housed?
Why you continue to blame the people who studied hard, paid off their college loans, worked their way up through their professions, and finally reached their peak earning years, befuddles me.
If you repeal the Bush tax cuts for only incomes over $250 K but maintain the cuts under that income level, you will only reduce the net revenue loss by 25%. There are only so many "rich" people to soak. Once soaked, we will retire, stop hiring and go away.
Who will you blame for your misfortunes then?
kathleenkatalina
Massachusetts
Americans get their news from multi-millionaires....Wolf, Charlie, Rush. None of the talking heads make less than 1/4 million a year, and none of them think they are rich.
Oprah, Warren Buffet, that Russian guy, they're rich. The talking heads are just middle class folks who make 5 or 6 million a year. And they have been baling up the Benjamins for the last ten years of tax cuts. Millions. Follow the money.
TV news, including MSNBC, keeps telling us that Obama is going to raise our taxes, but they really mean he is going to raise theirs.
The country is broke because of lies and incompetence, and all patriotic Americans need to sacrifice.
Just as the sons and daughters of the real middle class sacrificed when they volunteered for duty when Bush invaded the wrong country. The comfortable class has benefitted from our capitalist democracy, and they have not had to sacrifice. They have paid high taxes, but it has not hurt. Not the way it hurts the people I know.
They stand in line waiting to buy a few items. They dont use shopping carts. And after they add up to see if they have enough money , they are hit with a sales tax. On food. On the clothes and books the kids need. On gas.
My sister is 58, worked every day of her life, even during college, and she predicts that she will finally be out of debt in October. Then she can start saving for retirement. She had one child, not a dozen. And a husband.
Some people who are very well off have worked very hard, but so has every poor person. The rich have been lucky, and they need to stop being so selfish.
My favorite president needs to shame them into making the sacrifice.
If President Obama announced tomorrow that he was not going to stop their tax breaks, he would all of a sudden be very very popular. Follow the money...
Sandy Lewis
Lewis Family Farm, Essex, New York
FDR's predicament was different. FDR had not hired Bob Rubin, or Sidney Weinberg, for that matter, nor had he put Steve Rattner, arguably a criminal not charged by his administration, in charge of Detroit, only to remove him when news of his previous life emerged.
As and when news of Bob Rubin's previous life emerges, will the president remove his team?
Geithner was not smart enough to work at Goldman, Sachs, but he did the next best thing for one who would like to work there: he followed Goldman's line and worked to please Goldman, 24-7. There is no difference between Hank's team and Geithner's team, save one: Hank got the guys he wanted, and Tim Geithner can get no one to come.
Smart, honest guys do not want to work for Rubin in absentia. With Valerie Jarrett running things from behind the Oval Office, we have Larry and Tim and Valerie as the triumvirate under Caesar. And Bob Rubin is tight with Valerie, believe it. I got that from on high.
Hence, this Obama administration is really Rubin & Company. That's what we have here. Which wold work if they knew how to shoot straight.
No, it's late in the game to play the FDR 1936 Card. Save that one for 2012, when all the cards needed will have to be played.
For now, it would do to "out" them that caused it - and let the people know you know. The problem, Frank, among others - people think he doesn't get it.
And to date, it's clear the President Obama does not really, really get it. He's surrounded.
And those who have surrounded President Obama have the best insurance policy in the world in President Obama.
If the ---- hits he fan, big time, who will explain why He hired Them?
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