Tuesday, November 25, 2008

Befuddlement, Bailout Bubbles, and BBQ Squirrel (on a stick)


- Think Globally; Eat Locally

~~ BBQ Squirrel
~~ Marinated, Deep-fried Sparrow
~~ Bailouts for Bankers, Not a Cent for Autoworkers

- Befuddlement & Bailout Bubbles
~~ 7.4 Trillion Dollars And Counting
~~ Federal Reserve, Treasury Announce $800 Billion Plan to Support Consumer Lending
~~ You Ain't Seen Nothing Yet

- The More Things “Change” . . .
(Reality Check--Part Three)

~~ DN! Klein, Kuttner and Hudson Dissect Obama’s New Economic Team & Stimulus Plan
~~ Noam Chomsky: "What Next? The Elections, the Economy, and the World"
~~ Scheer - Change We Can Bank On [The Woman Obama Didn't Choose]
~~ Nader - Democrats Owe Jimmy Carter an Apology
~~ Petras - Bring on the Victims! Condemn the Fighters!

 [The Evils of "Lesser Evil" politics]
~~ Nader/Greider - The hypocrisy of liberals

Quote to ponder:
"The problems we face today cannot be solved by the minds that created them" -Albert Einstein

Think Globally; Eat Locally
It really is darn near impossible to keep up with the money our government has been giving away to Wall Street in recent days. Like buying a new computer, just about every article concerning bailout news is out of date before the consumer gets to it.

I thought we’d get to the important stuff first, if that’s OK.

It really is hard to get your mind around figures like 8.5 trillion dollars, which is about the amount our corporate controlled government has pledged to primarily the FIRE (Finance, Insurance and Real Estate) sector of the economy in recent bailout packages. No one really has a clue as to where that kind of money will come from, besides the printing press, or you and me, especially when our nation is nearly bankrupt and as we all know, you can't get blood out of taxpayers who have morphed into turnips. I don’t know if it has anything to do with the money these coorporations contribute to political campaigns, like the 53 million plus dollars the FIRE sector gave to McCain and Obama (Obama: $27,866,622, McCain, $25,177,854 (see OpenSecrets.org). We do know money from well-heeled special interest groups carries more weight than the contributions from the vast majority of citizens who pony up less than 200 dollars each for the same purpose.

According to OpenSecrets.org, $7,977.04 is the "Average contribution that donating [Obama] transition team members gave to all federal candidates, parties and committees this election cycle. Any individual could give up to $108,200 this election cycle. The percentage of Americans who give even $200 to federal politics is less than one-half of 1 percent." (Isn’t it past time for REAL campaign finance reform???)

As the economic situation continues to deteriorate, we look for solutions to our powerlessness over the financial magicians and corrupt politicians who allowed it to happen. About the only practical solution I have at the moment, besides restructuring social systems by eliminating the insidious control over our lives by Wall Street, other corporate interests, and bought off politicians, is looking to the availability of (non-native) squirrels and birds, of which there is no shortage. Americans in the east and southeast have delighted in the subtle flavors of squirrels since before the founding our national experiment, and not to diminish multi-cultural contributions, some of our Asian compatriots have a talent for wringing tasteful nutrition from sparrows and other animals. As we have an excess of both (not to mention uncontrolled semi-domesticated deer in the backyard—another real opportunity there), I thought my best contribution might be to offer a few recipes. Other opportunities may come to mind, but respecting local mores, they are not listed here.

BBQ Squirrel

Thanks to Todd Smith for sending in this recipe.
From http://www.backwoodsbound.com/zsquir14.html with a few suggestions of my own:

~ 4 squirrels, quartered
~ 3 tbsp salt
~ 2 tsp pepper
~ 1 tsp garlic powder
~ 1 tsp onion powder
~ your favorite dry rub
~ 15 charcoal briquets
~ 3 handfuls hickory chips
~ your favorite bbq sauce

In a large pot, boil the squirrel in water seasoned with the salt, pepper, garlic powder and onion powder for 1 hour or until tender.

In the meantime, soak the hickory chips in water. Light the charcoal and let them get white hot. Place them to one side of your grill.

Remove the squirrel from the water and pat dry. Coat with your favorite dry rub.

Add one handful of wood chips to the hot coals.

Place squirrel on grill across from the hot coals. (I would prefer skewering the squirrel on an available stick, and roasting it like a hot dog) Cover and smoke for 1 hour. Add a handful of wood chips every half hour.

Add last of the wood chips and baste squirrel with bbq sauce. Smoke for another half hour basting another 3 - 4 times.

Serve with mashed potatoes, sweet corn and buttermilk bisquits. (You can grow the potatoes and corn in your garden or glean the spuds from local fields.)


Other squirrel recipes are available from http://www.backwoodsbound.com/zsquir14.html

Marinated, Deep-fried Sparrow

Given their numbers, English sparrows (or starlings) are another overlooked delicacy here in Baker City. I’m really surprised Mad Matildas’ has ignored this treat as a possible money-maker to place along side of their Gelato creamy confections. Whatever happened to creative economic development anyway??? For inventive and enterprising entrepreneurs, it is not just about compromising the Democrats and local interest groups, other scavenging political opportunists, and networking anymore!

Exact recipes are hard to come by, but after you get the little rascals plucked, the general idea for gourmet culinary approaches to non-native sparrow (and even starlings) can be found at:


“In Vietnam, we learn, “birds the size of sparrows” were boiled and fried by itinerant, somewhat secretive Chinese cooks, and then eaten “bones and all.” Using her mother’s memory of this delicacy as a springboard, Nguyen has developed a tasty recipe that can be recreated in Western kitchens. She substitutes quail for the unnamed, sparrow-like birds, and, instead of boiling, steams them to preserve the flavors of the ginger-rice wine marinade before coating them with honey and soy sauce and deep frying them. The flavors and crispy skin are true to the original, even if the methods have changed.”

For other ideas and photographs of sparrow on the fork, see:
Andrew enjoying sparrow

Befuddlement & Bailout Bubbles

As the financial crisis/collapse is quickly unfolding, events and articles soon become outdated. Offered below are a few selected fairly recent articles that give perspectives you may not have encountered.

"The problems we face today cannot be solved by the minds that created them"
Albert Einstein

What’s a Billion Here, a Trillion there….

The following article was written yesterday, prior to the new $800 billion bailout package announced today. The total is now in the neighborhood of $8.2 Trillion (see a later article.).

7.4 Trillion Dollars And Counting

The Cost Of "Rescuing" The US Financial System

By Hamilton Nolan

November 24, 2008 "Gawker"

-- Hey, the government has agreed to bail out Citigroup. Surely we'll now be saved from worldwide insolvency! Right? Or is this a profligate waste of money? We have to level with you: this whole bailout thing has now exceeded the media's ability to critically analyze it. You've heard everyone throw around figures like $750 billion for the earlier bailout costs. This Citigroup thing includes a guarantee of $306 billion in assets. But think about this: according to Bloomberg, the US government has now pledged more than $7.4 trillion to rescue the financial system in the past 15 months. How much is 7.4 trillion?

It is "half the value of everything produced in the nation last year," according to Bloomberg.
It's enough to cut a check for almost $25,000 to every single citizen of the USA!
If you had 7.4 trillion pennies, you would have $74,000,000,000. That's enough money to buy the New York Times Co. 86 times over. If we say that 100 pennies stack up 4 inches high, 7.4 trillion pennies would stack up 4,671,717 miles high. That's enough to go to the moon and back ten times.

Fun with math! If you think the US media is equipped to evaluate numbers like this precisely, you're out of your mind. Even the media outlets that are most qualified to report on money matters have a hard time putting $1 trillion into perspective (try this: "It would take almost three decades to spend a trillion dollars at $1,000 per second), much less $7.4 trillion.

If it makes you feel better though: this financial crisis has actually erased $23 trillion in corporate value. So 7.4 tril isn't too bad! [Bloomberg]

For the whole sad story in detail, please read Bloomberg’s article:
U.S. Pledges Top $7.7 Trillion to Ease Frozen Credit (Update2) Mark Pittman and Bob Ivry
November 25, 2008

THE US Government is prepared to lend more than $US7.4 trillion ($A11.8 trillion) on behalf of American taxpayers, or half the value of everything produced in the nation last year, to rescue the financial system since the credit markets seized up 15 months ago.

The unprecedented pledge of funds includes $US2.8 trillion already tapped by financial institutions in the biggest response to an economic emergency since the New Deal of the 1930s, according to data compiled by Bloomberg. The commitment dwarfs the only plan approved by legislators, the Treasury Department's $US700 billion Troubled Asset Relief Program. Federal Reserve lending last week was 1900 times the weekly average for the three years before the crisis.
When Congress approved the TARP on October 3, Federal Reserve chairman Ben Bernanke and Treasury Secretary Henry Paulson acknowledged the need for transparency and oversight. Now, as regulators commit far more money while refusing to disclose loan recipients or reveal the collateral they are taking in return, some Congress members are calling for the Fed to be reined in.

The Government committed $US29 billion to help engineer the takeover in March of Bear Stearns by JPMorgan Chase & Co. and $US122.8 billion in addition to TARP allocations to bail out American International Group, once the world's largest insurer. Now Citigroup, as recently as last month the biggest US bank by assets, may need to be saved too.

The worst financial crisis in two generations has erased $US 23 trillion, or 38 per cent, of the value of the world's companies and brought down three of the biggest Wall Street companies.

Most of the spending programs are run out of the New York Fed, whose president, Timothy Geithner, is said to be President-elect Barack Obama's choice to be Treasury secretary.

The money that's been pledged is equivalent to $US 24,000 for every man, woman and child in the country. It's nine times what the US has spent so far on wars in Iraq and Afghanistan, according to Congressional Budget Office figures. It could pay off more than half the country's mortgages.

Congress and the Treasury have ponied up $US892 billion in TARP and other funding, or 12 per cent.

The Federal Housing Administration, overseen by Department of Housing and Urban Development Secretary Steven Preston, was given the authority to guarantee $US300 billion of mortgages, or about 4 per cent, of the total commitment, with its Hope for Homeowners program, designed to keep distressed borrowers from foreclosure.

Most of the federal guarantees reduce interest rates on loans to banks and securities companies, which would create a subsidy of at least $US6.6 billion annually for the financial industry, according to data compiled by Bloomberg comparing rates charged by the Fed against market interest paid by banks.

Not included in the calculation of pledged funds is an FDIC proposal to prevent foreclosures by guaranteeing modifications on $US444 billion in mortgages at an expected cost of $US24.4 billion to be paid from the TARP, according to FDIC spokesman David Barr. The Treasury Department hasnt approved the program.

Dr Bernanke and Mr Paulson have also promised as much as $US200 billion to shore up nationalised mortgage finance companies Fannie Mae and Freddie Mac. The FDIC arranged for $US139 billion in loan guarantees for General Electric's finance unit.

The tally doesnt include money to General Motors, Ford and Chrysler. Mr Obama has said he favours financial help to keep them from collapse.

Mr Paulson told the House Financial Services Committee on November 18 that the $US250 billion already allocated to banks through the TARP was an investment, not an expenditure.

"I think it would be extraordinarily unusual if the Government did not get that money back and more," Mr Paulson said.
Article was At: http://bloomberg.com/apps/news?pid=20601109&sid=arEE1iClqDrk&refer=home /news?pid=20601109&sid=arEE1iClqDrk&refer=home

Federal Reserve, Treasury Announce $800 Billion Plan to Support Consumer Lending

Let's see, Bloomberg said yesterday that the Federal government had committed $7.4 trillion to lending facilities and guarantees. The total is now $8.2 trillion thanks to new programs announced today to aid borrowing by consumers, small businesses, and homeowners.

Stocks have rallied, and the 30 year bond is also up three points, due to a GDP report that revised third quarter growth from positive 0.3% to negative 0.5%. We had been skeptical of the GDP release figures at the time. Note that October was worse than September, but retailers have said there is a slight improvement in the last couple of weeks from the sales levels they had seen earlier.

From the Fed's press release:
Purchases of up to $100 billion in GSE direct obligations under the program will be conducted with the Federal Reserve's primary dealers through a series of competitive auctions and will begin next week. Purchases of up to $500 billion in MBS will be conducted by asset managers selected via a competitive process with a goal of beginning these purchases before year-end. Purchases of both direct obligations and MBS are expected to take place over several quarters. Further information regarding the operational details of this program will be provided after consultation with market participants.

From a separate press release:
The Federal Reserve Board on Tuesday announced the creation of the Term Asset-Backed Securities Loan Facility (TALF), a facility that will help market participants meet the credit needs of households and small businesses by supporting the issuance of asset-backed securities (ABS) collateralized by student loans, auto loans, credit card loans, and loans guaranteed by the Small Business Administration (SBA).

Under the TALF, the Federal Reserve Bank of New York (FRBNY) will lend up to $200 billion on a non-recourse basis to holders of certain AAA-rated ABS backed by newly and recently originated consumer and small business loans. The FRBNY will lend an amount equal to the market value of the ABS less a haircut and will be secured at all times by the ABS. The U.S. Treasury Department--under the Troubled Assets Relief Program (TARP) of the Emergency Economic Stabilization Act of 2008--will provide $20 billion of credit protection to the FRBNY in connection with the TALF.

Some fine print from an attachment:
Eligible collateral will include U.S. dollar-denominated cash (that is, not synthetic)
ABS that have a long-term credit rating in the highest investment-grade rating category (for example, AAA) from two or more major nationally recognized statistical rating organizations (NRSROs) and do not have a long-term credit rating of below the highest investment-grade rating category from a major NRSRO.

All or substantially all of the credit exposures underlying eligible ABS must be newly or recently originated exposures to U.S.-domiciled obligors. The underlying credit exposures of eligible ABS initially must be auto loans, student loans, credit card loans, or small business loans guaranteed by the U.S. Small Business Administration. The set of permissible underlying credit exposures of eligible ABS may be expanded later to include commercial mortgage-backed securities, non-Agency residential mortgage backed securities, or other asset classes. The underlying credit exposures must not include exposures that are themselves cash or synthetic ABS.

Originators of the credit exposures underlying eligible ABS (or, in the case of SBA guaranteed loans, the ABS sponsor) must have agreed to comply with, or already be subject to, the executive compensation requirements in section 111(b) of the Emergency Economic Stabilization Act of 2008.

As we said in a post last evening on this program:
There are a few problems with this approach:

1. The banks have already been given support right, left and center. They are still not lending,

2. Some of the stinginess is warranted. Um, a credit bubble means a lot of people got loans who shouldn't have. Do we want banks again to make unsound loans? I should hope not, but I could be wrong here. A fair bit of consumer credit ought to contract. And even if a lot of good customers also have their credit lines cut, do you really think the banks are going to turn around and reverse these decisions on a meaningful scale. Ain't happening.

3. Consumers are scared about employment and the loss of their home equity piggybank. They also know they borrowed too much. They want to lower debt levels. So as a reader put it, "Even if you throw the horse in the lake, you can't make him drink."

4. Banks are so desperate to restore profits that they are jacking up prices on existing consumer credit, even as the Fed and Treasury have been provided lots of low-cost support. Citibank and American Express are raising interest rates on existing loan balances for a a significant proportion of customers, and they no doubt have company. If consumers face higher charges on their outstanding debt. it considerably reduces the odds that they can or will take on more debt.

And a separate issue: consumer debt and consumer spending were at unsustainable levels. They need to fall. Trying to shore up consumers is a wrongheaded way to stimulate the economy. Fiscal expenditures, including a broadening of safety nets, is a much better way to go.

Persisting in a failed course of action is not a sign of intelligence.


Bailouts for Bankers, Not a Cent for Autoworkers
posted by JOHN NICHOLS on 11/24/2008 @ 3:25pm

This is the part of our nation's surreal economic crisis that seems particularly surreal:
The US auto industry, which employs 3 million Americans in auto plants, parts and supplier networks and dealerships nationwide is broadly understood as being essential to maintaining America as an industrial force. It's financial collapse, which even critics of moves to bailout the industry suggest is imminent, would devastate workers, retirees and communities in every state of the nation. Despite the grumbling from anti-union zealots, the auto giants have radically retooled in a manner that makes the cost of producing a vehicle at a unionized plant of General Motors, Ford or Chrysler roughly equivalent to the cost of running a car off the line at a non-union plant. And to top it all off: Auto plants actually produce something that most Americans consider to be useful.

Yet, proposals to provide what now seems to be a very small bailout -- $25 billion -- are currently stalled.

At the same time, the whole of the federal government is scrambling to buy as much as $50 billion in "toxic assets" -- bad loans and other products of irresponsible financial practices that are of dubious value -- from Citigroup, a global banking concern that makes money by charging working families exorbitant interest rates for credit.

According to the Wall Street Journal, "[The move to protect the banking concern] would mean taxpayers could be on the hook if Citicorp's massive portfolios of mortgage, credit cards, commercial real-estate and big corporate loans continue to sour."
Perhaps, in some wild calculation of American interest, Citicorp is worthy of a bailout.
But what mad calculus would make Citigroup more worthy than the auto industry?

And why the urgency with regard to Citigroup and the casual disengagement with regard to the industrial giants that, for all their flaws and perils, remain what Barack Obama correctly described as "the backbone of American manufacturing"?

Something is fundamentally wrong with a federal government that offers bankers a bailout and autoworkers as cold shoulder.

So you might say "if they didn't show us a plan, why should we give them the money?" OK, good question. But why aren't we asking the commercial banks and Wall Street the same questions? Why are Congress and the press embarrassing auto-execs while they treat multimillionaire banksters with such reverence, when the banksters don't seem to have a plan either? [Chris]

Here's what Robert Kuttner has to say about that on DN!:

AMY GOODMAN: Bob Kuttner, why are the banks not ask the same questions that auto industry is asked. You have Nancy Pelosi and that others are saying when you bring us the plan, maybe we’ll talk about giving you money. Do the banks have any plans with the money they’re getting?

ROBERT KUTTNER: No, and of course that’s what we should be doing. I think rather than throwing money at them we ought to probably nationalize one or two banks. That with the money taxpayers are putting into the bank’s does what money usually does, producing. The amount of money taxpayers are putting into banks at this point is more than the total value of the stocks of these banks as valued by Wall Street.

Well if you’re putting in a majority share of the money, you should get a majority share of the ownership. If banks are too traumatized to resume lending, even with public money then if we had a publicly owned bank or two, we could show them how to do it. We could also have a complete look at their books, which we don’t now have. One question being asked about Tim Geithner is that if the Federal Reserve is the agency charged with examining bank holding companies and it was the strategy of Citigroup as a bank holding company, as shown in Sunday’s Time investigative piece, the strategy of the holding company was to do all of these exotic speculative investments.

Where was Tim Geithner at the Federal Reserve of New York which has the examiners that are supposed to be examining the bank at the holding company level. Why didn’t they get a look at the book? If we do not have tools to allow examiners to get inside to dig deep inside the plumbing and understand what dangerous risks bank speculators are taking, we need to do two things. We need to change the laws so the agency’s can have adequate supervisory power. The agencies need to use that adequate supervisory power. and in the meantime, we need to take this money and just nationalize a couple of banks outright. I completely agree with you that there is a double standard vis-a-vi the banks and vis-a-vi Detroit.


You Ain't Seen Nothing Yet

By Mike Whitney

"The problems we face today cannot be solved by the minds that created them"
Albert Einstein

November 24, 2008 "Information Clearinghouse"

-- Obama hasn't even been sworn in yet, and already the Wall Street cheerleaders are celebrating his first great triumph. According the pundits, the stock market staged a surprise 494 point rally on Friday because--get this--it was announced that Timothy Geithner would be appointed Obama's Treasury Secretary. 

Timothy who?

What nonsense. The sudden turn-around in stocks had a lot more to do with short-covering than anything else, but don't let that get in the way of a good story. Even so, the last minute surge on the NYSE couldn't stop another week-long bloodbath that ended with the Dow and S&P 500 tumbling another 5 percent. That's not to say that Geithner is not bright and talented guy. He is; and so is his White House counterpart, Lawrence Summers. But the media hype is way overdone. Geithner doesn't drive the markets and he isn't "change you can believe in". In fact, he's a protege of Henry Kissinger, a member of the Council on Foreign Relations, and has the same political pedigree as his predecessor, Henry Paulson. They're both part of the ruling fraternity and their views of the world are nearly identical. There's no doubt that Geithner will be more competent and effective than Paulson but, then again, who wouldn't be? Paulson may be the biggest flop at Treasury since Andrew Mellon steered the country onto the reef during the Great Depression. The recent flap over the Troubled Assets Relief Program (TARP) just proves the point. After convincing Congress to pass a $700 billion bailout plan--by invoking the specter of economic Armageddon and martial law--the former G-Sax chairman proceeded to set up a program for buying back mortgage-backed securities (MBS) and other junk paper from his banking buddies. Paulson argued that removing the crappy loans would help the banks get back on their feet and start lending again. Of course, no one could really figure out how the process was going to be executed, but maybe that's just nit-picking. Fortunately, Paulson never got a chance carry out his plan. He was torpedoed by the stock market which plunged seven days in a row losing nearly 20 percent of its value until Paulson threw in the towel and did what 200 economists had suggested from the very beginning---buy preferred shares in the banks so they could rev-up their credit engines again. 

Will Geithner be that stubborn? Not likely. And Paulson is a hard-nosed class warrior, too. Notice how every dime of the bailout has gone to banksters while all the efforts to provide relief to autoworkers, consumers or struggling homeowners have been blocked. Anyone who isn't in the upper 1 percent income bracket can forget about getting a helping hand. ....

The More Things “Change” . . .
(Reality Check--Part Three)


Naomi Klein, Robert Kuttner and Michael Hudson Dissect Obama’s New Economic Team & Stimulus Plan

AMY GOODMAN: . . . .William Greider had an interesting piece in The Nation.
“On Monday, Geithner was busy executing the government’s massive rescue of Citicorp--the very banking behemoth that Geithner and Summers helped to create back in the Clinton years, along with Federal Reserve chairman Alan Greenspan and Robert Rubin, Clinton’s economics guru. Now Rubin is himself a Citicorp executive and his bank is now being saved by his old protégé (Geithner) with the taxpayers’ money. Geithner has been a central player in the deal-making, from Bear Stearns to AIG to Citi. The strategy has not only failed, it has arguably made things worse as savvy market players saw through the contradictions and rushed out to dump more bank stocks.”

“Ultimately,” Mark Ames also in The Nation writes “Summers was one of the key architects of our financial crisis. Hiring him to fix the economy makes as much sense as appointing Paul Wolfowitz to oversee the Iraq withdrawal.”
. . . .

AMY GOODMAN: We begin with Naomi Klein. Your response to these appointments, and what they signify. If you could begin with Larry Summers, the former Clinton Treasury Secretary.

NAOMI KLEIN: It is good to be with you. I have to say it is a profound disappointment. It really does represent a very safe choice, but let’s remember Barack Obama won this election saying that taking the status quo, staying with the same policies that have been governing the country for the recent past, was actually a very dangerous course. I think in many ways we are paying the price of the intellectual dishonesty of the progressive liberals left during the bush years. Because Obama said again and again during the campaign that the crisis on Wall Street represented the culmination of an ideology of deregulation and laisse-faire trickle-down economics that had guided the country for the past eight years.

The truth is, it was not just eight years, they guided them under Reagan and also under Clinton. 
That is where Larry Summers comes in because he was the last treasury secretary under Clinton. He along with Alan Greenspan and Robert Rubin were the key architects of the policies of deregulation that created the crisis that we’re living now. And those key policies are the killing of Glass-Spiegel that allowed a series of very large but mergers that created these institutions that are too big and too intermingled to fail we’re told again and again. 
The deliberate decision to keep the derivatives out of the reach of financial regulators- that was also a Summer’s decision. And also allowing the banks to carry these extraordinary levels of debt. 33 to 1 in the case of Bear Sterns.

Now, in my book the Shock Doctrine I started chapter with a quote from Larry Summers in the context in which he says it was 1992 and it was when he was making World Bank economic policy as it related to Russia, in the midst of a financial crisis. What he said and this is why I quoted him because it really shows the extent to which he is truly an ideologue and a follower of the very ideology- not just a follower but a propagator of the very ideology that Obama ran his campaign against. And here’s the qoute. This is Larry Summers in 1992: “Spread the truth. The laws of economics are like the loss of engineering. One set of laws works everywhere.” And then he laid out those laws a little bit later. 
He referred to the three “ations”, and those were privatization, stabilization, and liberalization. So he has been preaching the doctrine. He is by no means an innocent bystander. He is a dyed-in-the-wool privatizer, free trader. And he along with Tim Geithner, his deputy play key roles during the economic crises.—along with Timothy Geithner . They preached more deregulation, more privatization and economic austerity to disastrous results. I think this is really troubling. One thing that Obama said is that Larry Summers set the terms of the debate for this financial crisis and that once again is very worrying. Because if Barack Obama thinks that these are the only terms, the parameters of the debate, then there’s very very narrow…

Much more at URL above

Noam Chomsky: "What Next? The Elections, the Economy, and the World"


“Actually what happened here is understood by elite elements. The public relations industry which runs elections here-quadrennial extravaganzas essentially- makes sure to keep issues in the margins and focus on personalities and character and so on–and-so forth. They do that for good reasons. They know- they look at public opinion studies and they know perfectly well that on a host of major issues both parties are well to the right of the population. That’s one good reason to keep issues off the table. And they recognize the success.

So, every year, the advertising industry gives a prize to, you know, to the best marketing campaign of the year. This year, Obama won the prize. Beat out Apple company. The best marketing campaign of 2008. Which is correct, it is essentially what happened. Now that’s quite different from what happens in a functioning democracy like say Bolivia or Haiti, except for the fact that it was crushed. And in the South, it’s not all that uncommon. Notice that each of these cases, there’s a much more extraordinary display of democracy in action than what we’ve seen–important as it was-here. And so the rhetoric, especially in Europe is correct if we maintain our own narrow racist perspective and say yeah, what happened was in the South didn’t happen or doesn’t matter. The only matters is what we do and by our standards, it was extraordinary miracle, but not by the standards of functioning democracy. In fact, there’s a distinction in democratic theory, which does separate say the United States from Bolivia or Haiti.

Question is what is a democracy supposed to be? That’s exactly a debate that goes back to the constitutional convention. But in recent years in the 20th century, it’s been pretty well articulated by important figures. So at the liberal end the progressive end, the leading public intellectual of the 20th century was Walter Lippman. A Wilson, Roosevelt, Kennedy progressive. And a lot of his work was on a democratic theory and he was pretty frank about it. If you took a position not all that different from James Madison’s. He said that in a democracy, the population has a function. Its function is to be spectators, not participants. He didn’t call it the population. He called it the ignorant and meddlesome outsiders. The ignorant and meddlesome outsiders have a function and namely to watch what’s going on. And to push a lever every once in a while and then go home. But, the participants are us, us privileged, smart guys. Well that’s one conception of democracy. And you know essentially we’ve seen an episode of it. The population very often doesn’t accept this. As I mentioned, just very recent polls, people overwhelmingly oppose it. But they’re atomized, separated. Many of them feel hopeless, unorganized, and don’t feel they can do anything about it. So they dislike it. But that’s where it ends.

In a functioning democracy like say Bolivia or the United States in earlier stages, they did something about it. That’s why we have the New Deal measures, the Great Society measures. In fact just about any step, you know, women’s rights, end of slavery, go back as far as you like, it doesn’t happen as a gift. And it’s not going to happen in the future. The commentators are pretty well aware of this. They don’t put it the way I’m going to, but if you read the press, it does come out. So take our local newspaper at the liberal end of the spectrum, “Boston Globe,” you probably saw right after the election, a front page story, the lead front page story was on how Obama developed this wonderful grassroots army but he doesn’t have any debts. Which supposed to be a good thing. So he’s free to do what he likes. Because he has no debts, the normal democratic constituency, labor, women, minorities and so on, they didn’t bring him into office. So he owes them nothing

The goal of advertising is to create uninformed consumers who will make irrational choices. Those of you who suffered through an economics course know that markets are supposed to be based on informed consumers making rational choices. But industry spends hundreds of millions of dollars a year to undermine markets and to ensure, you know, to get uninformed consumers making irrational choices.

And when they turn to selling a candidate they do the same thing. They want uninformed consumers, you know, uninformed voters to make irrational choices based on the success of illusion, slander, and effective body language or whatever else is supposed to be significant. So you undermine democracy pretty much the same way you undermine markets. Well, that’s the nature of an election when it’s run by the business world, and you’d expect it to be like that. There should be no surprise there. And it should also turn out the elected candidate didn’t have any debts. So you can follow Brand Obama can be whatever they decide it to be, not what the population decides that it should be, as in the south, let’s say. I’m going to say on the side, this may be an actual instance of a familiar and unusually vacuous slogan about the clash of civilization. Maybe there really is one, but not the kind that’s usually touted.

So let’s go back to the evidence that we have, rhetoric and actions. Rhetoric we know, but what are the actions? So far the major actions are selections, in fact the only action, of personnel to implement Brand Obama. The first choice was the Vice President, Joe Biden, one of the strongest supporters of the war in Iraq in the Senate, a long time Washington insider rarely deviates from the party vote. In cases where he does deviate they’re not very uplifting. He did break from the party and voting for a Senate resolution that prevented people from getting rid of their debts by, individuals, that is, from getting rid of their debts by going into bankruptcy. It’s a blow against poor people who’ve caught in this immense debt that’s a large part of the basis for the economy these days. But usually, he’s a, kind of, straight party-liner with the democrats on the sort of ultra naturalist side. The choice of Biden was a, must have been a conscious attempt to show contempt for the base of people who were voting for Obama, or organizing for him as an anti-war candidate.

Well, the first post-election appointment was for Chief of Staff, which is a crucial appointment; determines a large part of the president’s agenda. That was Rahm Emanuel, one of the strongest supporters of the war in Iraq in the House. In fact, he was the only member of the Illinois delegation who voted for Bush’s effective declaration of war. And, again, a longtime Washington insider. Also, one of the leading recipients in congress of funding from the financial institutions hedge funds and so on. He himself was an investment banker. That’s his background. So, that’s the Chief of Staff.

The next group of appointments were the main problem, the primary issue that the governments’ going to have to face is what to do about the financial crisis. Obama’s choices to more or less run this were Robert Rubin and Larry Summers from the Clinton--Secretaries of Treasury under Clinton. They are among the people who are substantially responsible for the crisis. One leading economist, one of the few economists who has been right all along in predicting what’s happening, Dean Baker, pointed out that selecting them is like selecting Osama Bin Laden to run the war on terror.


Yeah, I’ll finish. This saves me the problem of what’s coming next, so I’ll finish with the elections. Let me make one final comment on this. There was meeting on November 7, I think of a group of couple, of a dozen advisers to deal with the financial crisis. Their careers were, records were reviewed in the business press, and Bloomberg News had an article reviewing their records and concluded that these people, most of these people shouldn’t be giving advice about the economy. They should be given subpoenas.


Because most of them were involved in one or other form of financial fraud, that includes Rahm Emanuel, for example. What reason is there to think that the people who brought this crisis about are some how going to fix it? Well, that’s a good indication of what’s likely to come next, at least if we look at actions. . . . .”

Much more at URL above

Change We Can Bank On [The Woman Obama Didn't Choose]
November 19, 2008
Robert Scheer is the editor of Truthdig (http://www.truthdig.com/), where this article originally appeared. http://www.thenation.com/doc/20081201/scheer?rel=hp_currently

This is not change we can believe in. Not if Robert Rubin or his protégé, Lawrence Summers, get to call the shots on the economy in President-elect Barack Obama's incoming administration. Both Clinton-era treasury secretaries deserve a great deal of the blame for the radical deregulation of the financial industry that has derailed the world economy. They both should, along with former Federal Reserve chief Alan Greenspan, perform rites of contrition and be kept at a safe distance from the leadership of our nation.

Yet Rubin and Summers are highly visible in the Obama transition team, with Summers widely touted as Obama's pick for secretary of the treasury. New York Federal Reserve President Timothy Geithner, who also worked in the treasury department under Rubin and Summers, is the other leading candidate. But it was Summers who most vehemently pushed for congressional passage of that drastic deregulation measure, the Financial Services Modernization Act, which eliminated the New Deal barriers against mergers of commercial and investment banks as well as insurance companies and stock brokers. Standing at his side as President Bill Clinton signed the legislation, Summers heralded it as "a major step forward to the twenty-first century"--and what a wonderful century it's proving to be.

It was also Summers who worked in cahoots with Enron and banking lobbyists, and who backed Republican Sen. Phil Gramm's Commodity Futures Modernization Act, which banned any effective government regulation of the newly unleashed derivatives market. The result was not only a temporary boon to Enron, which soon collapsed under its unbridled greed, but also to the entire Wall Street financial community.

The only opposition from within the Clinton administration came from Brooksley E. Born who, as head of the Commodity Futures Trading Commission, dared defy Summers and Rubin, as well as Greenspan. In frequent appearances before Congress, she warned that the burgeoning derivatives trading "threatens our economy without any federal agency knowing about it." In reward for her prescience, Born, a highly regarded legal expert on derivatives, was treated to scornful attacks from the old boys' network, led (again) by Rubin, Greenspan and Summers, who questioned her competence and insisted it was she who threatened the stability of the market.

That sexism, as well as stupidity and greed, might have played a role in the dismissal of Born's concerns has been raised by some of Summers's critics, who were still smarting even after his subsequent forced departure from Harvard University after disparaging women's innate ability to grasp mathematics and science. "It was Larry Summers who called her up and screamed at her," Amy Siskind, co-founder of the New Agenda, a women's rights group that grew out of the Hilary Rodham Clinton presidential campaign, told the Boston Globe to support her view that Summers is a "known misogynist."
Whatever the motives, Born was painfully right in her warnings and Summers was totally wrong in overseeing the passage of legislation that summarily prevented any government regulation of the debt instruments that have proved so disastrous. I don't know if Born, now retired at 68, would be interested in the treasury secretary position, but she is certainly far more qualified than the other candidates under consideration.

Barring that possibility, why not go with Sheila Bair, the chair of the Federal Deposit Insurance Corporation (FDIC), who has distinguished herself by proposing a sterling alternative example of how to deal with the banking collapse? It is Bair who has most forcefully advanced the goal, advocated by Obama in his recent 60 Minutes interview, of putting homeowners before banks. Under her leadership, the FDIC has made sure that the insured banks, which it supervises and occasionally takes over, act to prevent foreclosures rather than using government handouts to finance new bank mergers.
On Tuesday, House Democrats led by Rep. Barney Frank of Massachusetts, accused Paulson of betraying Congressional language authorizing the $700 billion bailout that specifically called for "mortgage foreclosure diminution." Rep. Carolyn Maloney, D-NY, charged, "We're basically funding mergers and acquisitions, not lending." On Friday, Bair introduced a proposal to allocate $24.4 billion of the bailout specifically to modify loans to prevent 1.5 million foreclosures, but was opposed by Treasury Secretary Henry Paulson.

Because Geithner and Summers support Paulson's approach, Obama should reject them and pick Bair to give us the kind of change he's been promising.

November 25, 2008
The Democrats Owe Jimmy Carter an Apology
Don't Suppress Carter (or the Opportunities for Middle East Peace)

Now that the season of electoral expediency is over, Barack Obama owes Jimmy Carter an apology.
At the Democratic National Convention in Denver, the Party denied Jimmy Carter the traditional invitation to speak that is accorded its former presidents.

According to The Jewish Daily Forward, “Carter's controversial views on Israel cost him a place on the podium at the Democratic Party convention in late August, senior Democratic operatives acknowledged to the Forward.”
Silencing Carter, who negotiated the Israeli-Egyptian peace agreement, involved behind the scenes tensions between supporters of the hard-line AIPAC lobby and those Democrats who argued both respect and free speech to let Carter join Bill Clinton on the stage and address a nationwide audience.

First, there was a compromise offer to let Carter speak but only on domestic policy subjects. This would have kept him from mentioning his views on securing peace between the Israelis and Palestinians through a two-state solution essentially back to the 1967 borders. He previously elaborated his analysis and recommendations in his 2006 bestseller titled Palestine: Peace Not Apartheid..

Even this astonishing restriction on the former president was unacceptable to the dictatorial censors. They wanted nothing from the deliberate, candid Georgian short of complete exclusion.
More See: http://www.counterpunch.org/nader11252008.html

Western Progressive Opinion: 

Bring on the Victims! Condemn the Fighters!

By James Petras

November 23, 2008 "Information Clearinghouse"

 We know in some detail of the willing and gratuitous support, which tens of millions of American citizens have bestowed on the White House and Congressional perpetrators of crimes against humanity. The Clinton Administration was freely re-elected in 1996 after deliberately imposing a starvation embargo on Iraq and mounting a relentless, unopposed bombing campaign on that devastated country for four straight years, leading to the documented deaths of over 500,000 children and countless more vulnerable adults. The majority of US citizens re-elected Bush after he launched wars which caused the deaths of over a million Iraqi civilians, scores of thousands of Afghanis, thousands of Pakistanis, and after he gave full support to Israel’s murderous attacks on Palestinian civilians and the blockade of vital food, water and fuel to the occupied territories, not to mention the frequent bombing of Lebanon and Syria, which culminated, during Bush’s second term, in the horrific Israeli bombing campaign of Lebanese cities and villages killing thousands of civilians. We know this brutality received the unconditional support of the Presidents of the 52 Major American Jewish Organizations and their thousands of affiliated community groups (totaling over one million members). We know that for each and every Israeli assassination of a Palestinian, each dispossession of Palestinians from their land and homes and the uprooting of their orchards, vineyards and the poisoning of their wells, there is a systematic campaign here to obliterate our democratic freedom of speech and assembly – especially our right to publicly condemn Israel and expose its agents operating among US power brokers. 

Through hard experience the majority of the American public has come to recognize the pitfalls of militarism and is slowly coming to realize the profound threats posed by the entrenched Zionist Power Configuration to our ‘four freedoms’.

 That is all to the good. However, these advances in public opinion have been far from sufficient. The American public has just elected a new president who promises to escalate the imperialist military presence in Afghanistan and fill key posts in his regime with known militarists and Zionists from the previous regime of President ‘Bill’ Clinton. 

What has escaped public notice is the almost complete disappearance of the peace movement and its absorption into the pro-war Democratic Party electoral machine of President-Elect Barack Obama. Likewise, the vast majority of US ‘progressive’ opinion-makers embraced, with occasional mild reservations, the Obama candidacy and, in effect, became part of the ‘broad coalition’ joining hands with billionaire Zionist zealots and Wall Street financial swindlers, Clintonite ‘humanitarian’ militarists, impotent millionaire trade union bureaucrats and various and sundry upwardly mobile ‘minority’ politicians and vote hustlers. Whether progressives were intoxicated by the empty presidential campaign rhetoric of ‘change’, they willingly sacrificed their most elementary principles at the service of evil (presumably, they would say, to serve the ‘lesser evil’), but no doubt the evils of new imperial wars, complicity with Israel’s colonial savagery and the deepening immiseration of the American people. 

The US progressive intellectuals show no such (im)moral scruples when it comes to the anti-imperial resistance movements in Asian (especially in the Middle East), Africa and Latin America.

 US Progressives and Third World Resistance Movements

Among the most prominent progressive intellectuals (PPIs) in the US and Europe, writers, bloggers and academics, there is nary a single one who exhibits the same ‘pragmatism’, which they practice in choosing ‘lesser evil’ politicians in the US or Europe, with regard to political choices in highly conflicted countries. Can we find a single PPI who will argue that they support the democratically elected Hamas in Palestine or Hezbollah in Lebanon, or the popularly supported nationalist Muqtada al-Sadr in Iraq, the anti-occupation Taliban in Afghanistan or even the right, recognized under international law, of the Iranian people to the peaceful development of nuclear energy – because, whatever their defects – these are the ‘lesser evil’.

 Let us consider the issue in greater detail. PPIs justified their support for Obama on the basis of his campaign rhetoric in favor of peace and justice, even as he voted for Bush’s war budgets and foreign aid programs funding the murder of hundreds of thousands of Iraqis, Afghanis, Palestinians, Colombians, Somalis and Pakistanis and the dispossessing and displacement of at least 10 million people from their towns, farms and homes. The very same PPI reject and refuse to apply the ‘lesser evil’ criteria in support of Hamas, the democratically elected Palestinian administration in the Gaza, which is in the forefront of the struggle against the brutal Israeli colonial occupation – because it is ‘violent’ (which means it ‘retaliates against almost daily Israeli armed assaults), seeks a ‘theocratic state’ (similar to the theologically defined ‘Jewish’ state of Israel), represses dissidents (in the form of occasional crackdowns on CIA-funded Fatah functionaries and militias). At best the PPIs take an interest only in the Palestinian victims of Israel’s genocidal embargo of food, water, fuel and medicine; it protests against overt racist assaults by Israel’s colonial Judeo-fascist settlers when they assault school girls on their way to school or elderly farmers in their orchards; they protest the arbitrary and deliberate delays at Israeli military checkpoints, which cause the deaths of acutely ill Palestinians, cancer victims, women in labor, men with heart attacks and people in need of kidney dialysis by preventing them from reaching medical facilities. In other words the PPI support the Palestinians as victims but condemn them as fighters who challenge their executioners. The PPI’s support for victims is a cost-free posture, providing credibility to the ‘progressive’ label; opposition to the fighters assures the establishment that the PPI’s criticism will not adversely affect the US empire-building and its Israeli allies.

 The most outspoken, self-proclaimed progressive ‘libertarians’ and ‘democrats’ in the Western world claim to support national self-determination and oppose imperial conquests, yet they unfailingly reject the real-existing mass popular movements demanding self-determination and leading the struggle against imperial conquest and foreign occupation. Almost without exception they denounce national resistance movements for not fitting their preconceived notions of perfect justice, peaceful tolerance and secular, democratic principles, which their idea of a resistance movement should embody. Yet the PPI do not impose such criteria in advocating support for candidates in their own countries. Hezbollah is flatly rejected as too ‘clerical’ by the PPIs, but British progressives supported Tony Blair, the leader of the Labor Party and his role as bloody accomplice to Clinton, Bush, Sharon and a whole host of servile puppet regimes in Iraq, Afghanistan, Somalia and elsewhere. 

 In terms of military aggression – and deaths, loss of limbs and homes – the ‘lesser evil’ Democrats and European Social Democrats and Center-Left politicians have a far worse record that the Taliban, Hezbollah, Hamas and Sadrist forces. More to the point, the living conditions and safety of the vast majority of the people in Iraq, Afghanistan, Lebanon and Somalia – by any standard – were vastly better under the independent if authoritarian rule of Saddam Hussain, the clerical Taliban in Afghanistan, the Islamic Councils in Somalia than under the US-EU military occupations and client regimes. Some of the PPIs avoid the real and difficult choices by pretending that there are ‘third choices’ just on the horizon in countries currently under imperial and colonial conquest and occupation: They reject the imperial armies and the anti-imperial resistance in the name of abstract progressive libertarian principles. The shameless cant and hypocrisy of their position is clear when the same issue is posed in terms of political choices within the imperial mother country. Here the PPIs have a thousand and one arguments to back one (Obama) of the two major imperial war party presidential candidates; here ‘realism’ and ‘lesser evil’ arguments come to the fore. And what ‘choices’ are made! The same libertarians and democrats who condemn the Taliban for its destruction of ancient religious monuments support Democratic candidates, like Obama, who propose to escalate the US military occupation in Afghanistan and intensify the killing fields in South Asia. 

 There are profound moral and political dilemmas in making political choices in a world in which destructive imperial wars are led by liberal electoral politicians and vigorously resisted by clerical and secular authoritarian movements and leaders. But the historical record of the past three hundred years is clear: Western parliamentarian imperialism and its contemporary legacy has destroyed and undermined far more lives and livelihoods in far more countries over a greater time span than even the worst of the post colonial regimes. Moreover, the colonial wars, pursued by ‘lesser evil’ electoral regimes and politicians, have had a profoundly destructive impact on the very ‘democratic values’ in the Western countries, which the PPIs profess to defend.

 Conclusion

 The PPI, by choosing the ‘lesser evil’ – in the most recent instance, supporting Barack Obama – have condemned themselves to political impotence in the making of Washington’s policies and political irrelevance to the struggles for national liberation. Consequential supporters of the millions of victims of Western and Israeli butchery do not live off foundation handouts; they make the difficult (and costly) choice to throw in their lot via solidarity with the resistance fighters. The ‘cost’ to progressive intellectuals in the US, of course, is a drying up of invitations to speak at universities with offers of five-figure honorariums; the ‘benefit’ is self-respect and the dignity that comes from being part of an international anti-imperialist movement.

The hypocrisy of liberals

. . . ."The hypocrisy of liberals, which may in some ways be unconscious, is empowering the forces that are destroying our nation," Nader asserted in an even-tempered voice. "The left in this country has been successfully cowed by the Democratic Party," he continued. "The votes of progressives are taken for granted by Democrats.... By allowing ourselves to be manipulated, we have demonstrated that we have no moral substance. We have no line that can be never be crossed, no stance so sacred and important that we are willing to stand up and fight back."
So long as progressives are willing to settle for the "least worst" alternative, they will remain ignored and excluded from power, he suggested.

This kind of talk from Nader drives some people to rage against him. He returns the favor by discussing "the rage that many in our nation feel towards liberals." Barack Obama, he insists, does not intend to alter anything fundamental about the causes. "This rage is a legitimate expression of very real betrayal," Nader explained. "The working class, most of whom do not vote, watch Democratic candidate after Democratic candidate run for office promising to support labor and protect jobs and then, once elected, trot off to Washington to pass the corporate-friendly legislation drawn up by the 35,000 lobbyists who work for our shadow government."

In Nader's Stubborn Idealism

Posted by Christopher Christie at 9:51 PM 1 comments

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