“Effing Retarded” in Obama’s White House: How to Alienate Democrats

For reasons that could make sense only to the “effing retarded,” the Obama White House has chosen not only to ignore virtually every Democratic voter group but to taunt them, rub their noses in it, and insult any Democrats who dare to demand better choices than the corporate shills that now control much of the Party and the White House.

Ever the naive optimist, I hoped the effing retarded coward who anonymously criticized working families for trying to get an Arkansas Senate candidate that isn’t yet totally owned by corporations was just showing his usual political stupidity. After all, the usual cowardly “senior [White House] official,” Rahm Emanuel, is well known for promoting either loser candidates that alienate the base or those who predictably vote against a decent Democratic agenda. He’s been a train wreck for the Democratic Party, helping Obama kill all hope for reversing a decade of disastrous policies.

But it wasn’t just the usual White House coward spouting off. Today, when reporters asked Press Secretary Gibbs whether the anonymous coward spoke for the White House, instead of saying the idiot would be found and fired — as any rational President would do even he cared only for his own political success — Gibbs essentially said yes, the White House endorsed the underlying message: unions and others unhappy with corporate Democrats should not be working to replace them but instead support Democrats in the general.

Oh really? Well, screw you and your anti-democratic views, White House.

So let’s see. In just the last year, the White House has managed not merely to ignore and disappoint but often gone out of its way to mislead, lie to and betray liberals/progressives, labor unions, teachers, Hispanics, gays/lesbians, anti-war groups, dedicated environmentalists, respected pro-employment/pro-growth Nobel economists, climate scientists, financial reformers, defenders of Medicare and Social Security, mainstreet populists, civil liberties and women’s rights advocates, defenders of public interest regulation, alternative energy/efficiency supporters and even scarecrows.

In case you don’t recognize the list, that’s the core, the heart, the brains and the foot soldiers of the Democratic Party.

It’s practically everyone that makes the Democratic Party worth having as a party. They’re the people who’ve advocated effective governance and defended rationality against mindlessness, and who’ve spent years working in the public interest. They put Obama in the White House and Democrats in the majority to return their values to governance. And without them, who’s left? What’s left of the party?

Apparently, the Obama White House thinks they don’t need the Democratic Party as anything other than an empty, mindless shell. They don’t need the people and groups who’ve made up the party for decades. They don’t want anyone but unthinking, acquiescent shills, willing to rubber stamp corporate hacks, half-assed policies, broken promises, missed opportunities, discredited free-market rhetoric and pandering to nihilist nonsensical Republican “ideas” and “good faith,” and who won’t complain as the disloyal opposition and crazies do and say everything they can to destroy political discourse and delegitimize government that functions in the public interest.

This is apparently what the White House wants, because that’s what their words and actions tell us. Screw the party; screw its most loyal members.

Well, screw you too, Mr. Obama. You have this backwards. It is we who don’t need you and your crowd. We know whose ass to kick. With no party behind you, it’s one term and out. We want our party back.

John Chandley

By Dr. Paul Craig Roberts

Global Research, June 2, 2010

Interview with Dr. Paul Craig Roberts, former Assistant Secretary US Treasury, Associate Editor Wall Street Journal, Professor of Political Economy Center for Strategic and International Studies Georgetown University Washington DC.

Question: Dr. Roberts, the United States is regarded as the most successful state in the world today. What is responsible for American success?

Dr. Roberts: Propaganda. If truth be known, the US is a failed state. More about that later. The US owes its image of success to: (1) the vast lands and mineral resources that the US “liberated” with violence from the native inhabitants, (2) Europe’s, especially Great Britain’s, self-destruction in World War I and World War II, and (3) the economic destruction of Russia and most of Asia by communism or socialism.

After World War II, the US took the reserve currency role from Great Britain. This made the US dollar the world money and permitted the US to pay its import bills in its own currency. World War II’s destruction of the other industrialized countries left the US as the only country capable of supplying products to world markets. This historical happenstance created among Americans the impression that they were a favored people. Today the militarist neoconservatives speak of the United States as “the indispensable nation.” In other words, Americans are above all others, except, of course, Israelis.

To American eyes a vague “terrorist threat,” a creation of their own government, is sufficient justification for naked aggression against Muslim peoples and for an agenda of world hegemony.

This hubristic attitude explains why among most Americans there is no remorse over the one million Iraqis killed and the four million Iraqis displaced by a US invasion and occupation that were based entirely on lies and deception. It explains why there is no remorse among most Americans for the countless numbers of Afghans who have been cavalierly murdered by the US military, or for the Pakistani civilians murdered by US drones and “soldiers” sitting in front of video screens. It explains why there is no outrage among Americans when the Israelis bomb Lebanese civilians and Gaza civilians. No one in the world will believe that Israel’s latest act of barbarity, the murderous attack on the international aid flotilla to Gaza, was not cleared with Israel’s American enabler.

Question: You said that the US was a failed state. How can that be? What do you mean?

Roberts: The war on terror, invented by the George W. Bush/Dick Cheney regime, destroyed the US Constitution and the civil liberties that the Constitution embodies. The Bill of Rights has been eviscerated. The Obama regime has institutionalized the Bush/Cheney assault on American liberty. Today, no American has any rights if he or she is accused of “terrorist” activity. The Obama regime has expanded the vague definition of “terrorist activity” to include “domestic extremist,” another undefined and vague category subject to the government’s discretion. In short, a “terrorist” or a “domestic extremist” is anyone who dissents from a policy or a practice that the US government regards as necessary for its agenda of world hegemony.

Unlike some countries, the US is not an ethic group. It is a collection of diverse peoples united under the Constitution. When the Constitution was destroyed, the US ceased to exist. What exists today are power centers that are unaccountable. Elections mean nothing, as both parties are dependent on the same powerful interest groups for campaign funds. The most powerful interest groups are the military/security complex, which includes the Pentagon, the CIA, and the corporations that service them, the American-Israel Public Affairs Committee, the oil industry that is destroying the Gulf of Mexico, Wall Street (investment banks and hedge funds), the insurance companies, the pharmaceutical companies, and the agri-companies that produce food of questionable content.

These corporate powers comprise an oligarchy that cannot be dislodged by voting. Ever since “globalism” was enacted into law, the Democrats have been dependent on the same corporate sources of income as the Republicans, because globalism destroyed the labor unions. Consequently, there is no difference between the Republicans and Democrats, or no meaningful difference.

The “war on terror” completed the constitutional/legal failure of the US. The US has also failed economically. Under Wall Street pressure for short-term profits, US corporations have moved offshore their production for US consumer markets. The result has been to move US GDP and millions of well-paid US jobs to countries, such as China and India, where labor and professional expertise are cheap. This practice has been going on since about 1990.

After 20 years of offshoring US production, which destroyed American jobs and federal, state and local tax base, the US unemployment rate, as measured by US government methodology in 1980, is over 20 percent. The ladders of upward mobility have been dismantled. Millions of young Americans with university degrees are employed as waitresses and bartenders. Foreign enrollment comprises a larger and larger percentage of US universities as the American population finds that a university degree has been negated by the offshoring of the jobs that the graduates expected.

When US offshored production re-enters the US as imports, the trade balance deteriorates. Foreigners use their surplus dollars to purchase existing US assets.

Consequently, dividends, interest, capital gains, tolls from toll roads, rents, and profits, now flow abroad to foreign owners, thus increasing the pressure on the US dollar. The US has been able to survive the mounting claims of foreigners against US GDP because the US dollar is the reserve currency. However, the large US budget and trade deficits will put pressures on the dollar that will become too extreme for the dollar to be able to sustain this role. When the dollar fails, the US population will be impoverished.

The US is heavily indebted, both the government and the citizens. Over the last decade there has been no growth in family income. The US economy was kept going through the expansion of consumer debt. Now consumers are so heavily indebted that they cannot borrow more. This means that the main driving force of the US economy, consumer demand, cannot increase. As consumer demand comprises 70% of the economy, when consumer demand cannot increase, there can be no economic recovery.

The US is a failed state also because there is no accountability to the people by corporations or by government at any level, whether state, local, or federal. British Petroleum is destroying the Gulf of Mexico. The US government has done nothing. The Obama regime’s response to the crisis is more irresponsible than the Bush regime’s response to Hurricane Katrina. Wetlands and fisheries are being destroyed by unregulated capitalist greed and by a government that treats the environment with contempt. The tourist economy of Florida is being destroyed. The external costs of drilling in deep waters exceeds the net worth of the oil industry. As a result of the failure of the American state, the oil industry is destroying one of the world’s most valuable ecological systems.

Question: What can be done?

Roberts: The American people are lost in la-la land. They have no idea that their civil liberties have been forfeited. They are only gradually learning that their economic future is compromised. They have little idea of the world’s growing hatred of Americans for their destruction of other peoples. In short, Americans are full of themselves. They have no idea of the disasters that their ignorance and inhumanity have brought upon themselves and upon the world.

Much of the world, looking at a country that appears both stupid and inhumane, wonders at Americans’ fine opinion of themselves. Is America the virtuous “indispensable nation” of neoconservative propaganda, or is America a plague upon the world?

Obama the peace president is fighting battles his country cannot afford

By ERIC MARGOLIS, QMI Agency. Published by the Toronto Sun.

U.S. President Barack Obama calls the $3.8-trillion US budget he just sent to Congress a major step in restoring America’s economic health.

In fact, it’s another potent fix given to a sick patient deeply addicted to the dangerous drug — debt.

More empires have fallen because of reckless finances than invasion. The latest example was the Soviet Union, which spent itself into ruin by buying tanks.

Washington’s deficit (the difference between spending and income from taxes) will reach a vertiginous $1.6 trillion US this year. The huge sum will be borrowed, mostly from China and Japan, to which the U.S. already owes $1.5 trillion. Debt service will cost $250 billion.

To spend $1 trillion, one would have had to start spending $1 million daily soon after Rome was founded and continue for 2,738 years until today.

Obama’s total military budget is nearly $1 trillion. This includes Pentagon spending of $880 billion. Add secret black programs (about $70 billion); military aid to foreign nations like Egypt, Israel and Pakistan; 225,000 military “contractors” (mercenaries and workers); and veterans’ costs. Add $75 billion (nearly four times Canada’s total defence budget) for 16 intelligence agencies with 200,000 employees.

The Afghanistan and Iraq wars ($1 trillion so far), will cost $200-250 billion more this year, including hidden and indirect expenses. Obama’s Afghan “surge” of 30,000 new troops will cost an additional $33 billion — more than Germany’s total defence budget.

No wonder U.S. defence stocks rose after Peace Laureate Obama’s “austerity” budget.

Military and intelligence spending relentlessly increase as unemployment heads over 10% and the economy bleeds red ink. America has become the Sick Man of the Western Hemisphere, an economic cripple like the defunct Ottoman Empire.

The Pentagon now accounts for half of total world military spending. Add America’s rich NATO allies and Japan, and the figure reaches 75%.

China and Russia combined spend only a paltry 10% of what the U.S. spends on defence.

There are 750 U.S. military bases in 50 nations and 255,000 service members stationed abroad, 116,000 in Europe, nearly 100,000 in Japan and South Korea.

Military spending gobbles up 19% of federal spending and at least 44% of tax revenues. During the Bush administration, the Iraq and Afghanistan wars — funded by borrowing — cost each American family more than $25,000.

Like Bush, Obama is paying for America’s wars through supplemental authorizations ­— putting them on the nation’s already maxed-out credit card. Future generations will be stuck with the bill.

This presidential and congressional jiggery-pokery is the height of public dishonesty.

America’s wars ought to be paid for through taxes, not bookkeeping fraud.

If U.S. taxpayers actually had to pay for the Afghan and Iraq wars, these conflicts would end in short order.

America needs a fair, honest war tax.

The U.S. clearly has reached the point of imperial overreach. Military spending and debt-servicing are cannibalizing the U.S. economy, the real basis of its world power. Besides the late U.S.S.R., the U.S. also increasingly resembles the dying British Empire in 1945, crushed by immense debts incurred to wage the Second World War, unable to continue financing or defending the imperium, yet still imbued with imperial pretensions.

It is increasingly clear the president is not in control of America’s runaway military juggernaut. Sixty years ago, the great President Dwight Eisenhower, whose portrait I keep by my desk, warned Americans to beware of the military-industrial complex. Six decades later, partisans of permanent war and world domination have joined Wall Street’s money lenders to put America into thrall.

Increasing numbers of Americans are rightly outraged and fearful of runaway deficits. Most do not understand their political leaders are also spending their nation into ruin through unnecessary foreign wars and a vainglorious attempt to control much of the globe — what neocons call “full spectrum dominance.”

If Obama really were serious about restoring America’s economic health, he would demand military spending be slashed, quickly end the Iraq and Afghan wars and break up the nation’s giant Frankenbanks.

Lets see, for the third month in a row, the economy LOST jobs: 18,000 in November, 85,000 in December, and now another 20,000 in January.

So, according to basic 5th grade arithmetic, the unemployment rate INCREASED right? It was about 10.2% in November, so now it’s about 10.7% right? Or, if you count the numbers the REAL way they did 40 years ago, which includes the part-timers and discouraged, its actually about 17.7%!

My god, over 17% unemployment! No, the government says, we can’t tell people the truth about unemployment the way they did back in the 1930′s, or they will realize we are truly in the Second Great Depression, and demand greater action for jobs (and JOBS PROGRAMS – not just more Obamabot handouts, tax breaks and bailouts for Corporate America). Civil disturbances, protests, attacks on corporate power, can’t let that happen.

So instead, the Department of Labor Statistics, backed up by the Big Corporate Media, just plays the same old “Are You Dumber Than a 5th Grader?” game with the American people. Because hundreds of thousands, perhaps millions, of Americans have become so depressed and discouraged over the job market that they are no longer looking for work, they NO LONGER COUNT as human beings for our purposes.

Depressed and discouraged? You no longer exist in the great “Corporate Matrix” then.

So, according to “Dumber Than a 5th Grader” math:

120,000 or more jobs lost since October, from a rate of 10.2% nationally = 9.7% unemployment today!!!!

Wait a minute, says the 5th grader, doesn’t more jobs lost mean a HIGHER rate?

Of course, but the government thinks you are moron, wants to treat you like a moron, so they say its just 9.7%!

It’s George Orwell’s “Doubleplusthink”: Losing more jobs means lower unemployment! “How many fingers am I holding up?”

The answer to that is one, and its the middle one.

Add to this the new statistics that show Productivity rising 6.2% in January, and the REALITY is that Americans who are still employed are being worked like dogs at increasingly lower pay.

Wake up America, you are being reduced to serfs and slaves. And the Corporate-Government plantation owners say: “you’ll take what we give you, and work you like a dog at whatever crappy wages we want. And if you don’t like it, well tough, then you just DON’T EXIST.”

Nothing could possibly symbolize the beginning of the end of the American Empire more than the suspension of NASA’s manned space program. What represented the pinnacle of American power, the 1969 landing on the moon, now stands more than 40 years in the past. The decision to scrap a return mission to the moon, and to end the planned replacement of the Space Shuttle manned flight with the new Ares rocket, certainly spells the symbolic end of that era.

Space represents humanity’s hopes and dreams, our highest aspirations, yet those aspirations died with barely a whimper this week. Like the Roman legions leaving England in the early 5th Century, it marks the beginning of an end of American power.

Just as we suspected, the “Volcker Rule” proposed by the Administration fails to acknowledge the new facts on the ground: that the crisis took place in the capital markets, and that some of the major participants were funded by deposits was incidental. Half of the balance sheet of major dealers comes from repos, and a seize up in the repo markets was a major (and generally unacknowledged) crisis mechanism.

The most remarkable bit of a story up at Reuters is that the key element is buried partway through, although Huffington Post (hat tip reader Tim S) zeroed in on it:

Some institutions will be able to avoid facing the Volcker rule by shedding their insured deposits, according to U.S. Deputy Treasury Secretary Neal Wolin on Monday.

Goldman Sachs Group, which funds fewer than 5 percent of its assets with deposits, could easily change its funding profile to get out from under the rule.

So the Treasury would like to get tough with banks that hold a lot of deposits, and blithely ignore the fact that it rescued (via forced mergers) Bear and Merrill, neither which held deposits, that the failure of Lehman, again, not a depositary, nearly precipitated a systemic collapse, and that the powers that be felt compelled to rescue AIG, again not a depositary. Oh, and that it allowed Goldman and Morgan Stanley to become banks and receive TARP funds because their failure was feared to create a systemic failure.

Notice that the Reuters article focuses on the idea that the plan could conceivably work, ignoring that it will preserve the worst aspect of the status quo: that guarantees have been extended to capital markets firms, and a considerable portion of them are not going to subject to more strict regulation as a result.

So if this proposal moves forward (but all indications are that it won’t), expect Bank of America to spin out Merrill post haste and for JP Morgan to engage in loud complaints about how unfairly it is being treated (Citi would like to as well but presumably knows better). And that over time will lead to the rule being gutted. The reason Glass Steagall became irrelevant (and it was well before it was formally rescinded in 1998; the only practical consequence of that act was to remove an impediment to the Citigroup-Travelers merger) was that commercial banks had pointed to how investment banks were eating their lunch and earning more money and demanded a more level playing field. They got a series of variances starting in the 1980s, with the result by the mid-1990s that commercial banks were represented in the top ten in pretty much all major investment banking products. So while the Volcker Rule could in theory lead to a return to Glass Steagall, the big problem, the need for tougher restrictions on capital markets players (NOT depositaries) remains unaddressed.

Steve Keen, a widely respected economist from Australia is leading the way with a scathing attack on the qualifications of Fed chairman Ben Bernanke.

Specifically, Keen says “Bernanke’s ignorance of the factors that really caused the Great Depression is a major reason why the Global Financial Crisis occurred in the first place.”

Of course I agree, having said so many times over the past several years. The effect might be better coming from a top-notch economist who understands more than Bernanke does about debt.

With that backdrop, please consider The economic case against Bernanke

The US Senate should not reappoint Ben Bernanke. As Obama’s reaction to the loss of Ted Kennedy’s seat showed, real change in policy only occurs after political scalps have been taken. An economic scalp of this scale might finally shake America from the unsustainable path that reckless and feckless Federal Reserve behavior set it on over 20 years ago.

Some may think this would be an unfair outcome for Bernanke. It is not. There are solid economic reasons why Bernanke should pay the ultimate political price.

Misunderstanding the Great Depression

Bernanke is popularly portrayed as an expert on the Great Depression—the person whose intimate knowledge of what went wrong in the 1930s saved us from a similar fate in 2009.

In fact, his ignorance of the factors that really caused the Great Depression is a major reason why the Global Financial Crisis occurred in the first place.

The best contemporary explanation of the Great Depression was given by the US economist Irving Fisher in his 1933 paper “The Debt-Deflation Theory of Great Depressions”. Fisher had previously been a cheerleader for the Stock Market bubble of the 1930s, and he is unfortunately famous for the prediction, right in the middle of the 1929 Crash, that it was merely a blip that would soon pass:

“ Stock prices have reached what looks like a permanently high plateau. I do not feel that there will soon, if ever, be a fifty or sixty point break below present levels, such as Mr. Babson has predicted. I expect to see the stock market a good deal higher than it is today within a few months.” (Irving Fisher, New York Times, October 15 1929)

When events proved this prediction to be spectacularly wrong, Fisher to his credit tried to find an explanation.

A disequilibrium-based analysis was therefore needed, and that is what Fisher provided. He had to identify the key variables whose disequilibrium levels led to a Depression, and he argued that the two key factors were “over-indebtedness to start with and deflation following soon after”.

I fancy that over-confidence seldom does any great harm except when, as, and if, it beguiles its victims into debt. (p. 341)

Fisher then argued that a starting position of over-indebtedness and low inflation in the 1920s led to a chain reaction that caused the Great Depression.

Fisher confidently and sensibly concluded that “Evidently debt and deflation go far toward explaining a great mass of phenomena in a very simple logical way”.

So what did Ben Bernanke, the alleged modern expert on the Great Depression, make of Fisher’s argument? In a nutshell, he barely even considered it.

Bernanke is a leading member of the “neoclassical” school of economic thought that dominates the academic economics profession, and that school continued Fisher’s pre-Great Depression tradition of analysing the economy as if it is always in equilibrium.

Keen lists 9 points of Fisher’s debt deflation thesis that Bernanke ignored. Furthermore, Keen picks apart some of Bernanke’s essays on the Great depression highlighting the fact …

Crucially, even though Bernanke notes at the beginning of his book that “the premise of this essay is that declines in aggregate demand were the dominant factor in the onset of the Depression” (p. ix), his equilibrium perspective made it impossible for him to see the obvious cause of the decline: the change from rising debt boosting aggregate demand to falling debt reducing it.

Bernanke’s failure

If this were just about the interpretation of history, then it would be no big deal. But because they ignored the obvious role of debt in causing the Great Depression, neoclassical economists have stood by while debt has risen to far higher levels than even during the Roaring Twenties.

The next three charts show what that dereliction of regulatory duty has led to…..

I do not want to reproduce too much of Keen’s article, it is best if you read it in entirety on his site otherwise you may miss some excellent charts and explanations. However, I do want to highlight Keen’s conclusion.

Bernanke, as the neoclassical economist most responsible for burying Fisher’s accurate explanation of why the Great Depression occurred, is therefore an eminently suitable target for the political sacrifice that America today desperately needs. His extreme actions once the crisis hit have helped reduce the immediate impact of the crisis, but without the ignorance he helped spread about the real cause of the Great Depression, there would not have been a crisis in the first place. As I will also document in an update in early February, some of his advice has made America’s recovery less effective than it could have been.

Obama came to office promising change you can believe in. If the Senate votes against Bernanke’s reappointment, that change might finally start to arrive.

Bernanke Rally Cry

Over the weekend, Bernanke supporters we out in full force. Obama all but waved flags for a man hugely responsible for this crisis. And Senators Chris Dodd And Judd Gregg Confident Of Bernanke Confirmation.

On the other hand please consider the most wishy-washy endorsement in history. It comes from Paul Krugman in The Bernanke Conundrum.

Where do I stand? I deeply admire Mr. Bernanke, both as an economist and for his response to the financial crisis. (Full disclosure: before going to the Fed he headed Princeton’s economics department, and hired me for my current position there.) Yet his critics have a strong case. In the end, I favor his reappointment, but only because rejecting him could make the Fed’s policies worse, not better.

… here comes my defense of a Bernanke reappointment — any good alternative for the position would face a bruising fight in the Senate. And choosing a bad alternative would have truly dire consequences for the economy.

Furthermore, policy decisions at the Fed are made by committee vote. And while Mr. Bernanke seems insufficiently concerned about unemployment and too concerned about inflation, many of his colleagues are worse. Replacing him with someone less established, with less ability to sway the internal discussion, could end up strengthening the hands of the inflation hawks and doing even more damage to job creation.

Wow. That’s some ringing “endorsement”.

I will take my chances. Besides, we will be stuck with Bernanke for 14 more years anyway as he will still have a voting seat on the Fed.

The Fed should be disbanded. Clearly the market can set interest rates far better than the Fed did. Flipping coins might have worked better. It would be nice to get a chairman who understands the need to dismantle the Fed but that is not the way bureaucrats think.

Squawking Like A Half-Plucked Chicken

In spite of the outward confidence displayed by a handful of senators, Obama would not be running around squawking like a half-plucked chicken, attempting to garner support for Bernanke, if the votes were guaranteed to be there.

Indeed, this outward display of confidence squawking shows a distinct lack of confidence.

Cloture

I spoke with Yves Smith at Naked Capitalism on Sunday afternoon. She is going to post on this as well. From Yves … “You need to tell readers to vote “no” on cloture for Bernanke, not just “no” on Bernanke.”

Please make a note of that. Cloture is a vote to end the discussion. It takes 60 votes to do that. It only takes 51 votes to appoint Bernanke. He likely has those 51 votes. Does he have 60? I don’t know. But let’s make it very difficult.

Dump Bernanke – How You Can Help!

Please review Dump Bernanke – How You Can Help! Even if you already called or emailed, do it again.

This time flood the senator’s email inboxes as well. Jam em. And do it Monday, Tuesday, and Wednesday.

Maybe the votes are there. Maybe they aren’t.

It’s important to make sure that if the vote’s are not there, it stays that way. You can help.
Keep the pressure on.

Call and email your senators with the same message.

I had someone email me over the weekend that his senator’s email box was filled up. The goal is to fill up the email boxes of all the senators.

Here is a directory sorted by state of all the Senators of the 111th Congress.