Punting the Pundits

“It plays right into the hands of a bunch of pundits out there,” sighed Jamie Dimon, the chief executive of JPMorgan Chase, on Thursday. [..]

In his conference call, Dimon claimed that the disastrous hedging strategy had not violated the Volcker Rule. Rather, he said, it violated the “Dimon principle.” By which he meant, I think, that it was an example of the kind of dumb risk-taking that JPMorgan usually avoids.

But that’s just the point, isn’t it? Even at a bank as ostensibly well-run as JPMorgan, the incentives still exist for giant, risky bets to be made that can go very wrong. JPMorgan can withstand a $2 billion hit, but not every bank can – and who’s to say that the next derivatives debacle won’t be $5 billion or $10 billion? Jamie Dimon is undoubtedly a very good bank chieftain, but he’s only one man in a large institution; he can’t oversee every trade. The only way to change incentives industrywide – and get bank risk-taking under better control – is through a combination of tougher rules and more transparency. Which is precisely what Dodd-Frank aims to do.

Owen Jones: Shock Doctrine Opponents Revolt: The Austerity Backlash Across Europe

The truth is that the real world has paid the high priests of austerity an unwelcome visit

When I first read Naomi Klein’s The Shock Doctrine a few years ago, I had no idea how prescient the book was. It was a polemic about “disaster capitalism”, arguing that sudden crises are intentionally manipulated to push through extreme free market policies that were otherwise not politically possible. But early 2008 was a completely different era: although Northern Rock had just suffered the first bank run for 150 years, it seemed like a bizarre blip. The US sub-prime crisis was rumbling away, but it was like sheet lightning from a distant storm. “The deficit” was not an everyday term of political debate. It was not at all clear that the world was about to be utterly transformed.

And yet the past four years have proved a total vindication of Klein’s argument. A crisis of the market was cleverly transformed by free market ideologues into a crisis of public spending. Across Europe, the biggest slump since the 1930s has been used to push through policies straight out of some right-wing wet dream: the slashing of taxes on the rich and major corporations; the selling off of public services; and a bonfire of workers’ rights. It is disaster capitalism on speed.

But, this week, the great revolt against the Shock Doctrine began. That is exactly how we must understand the sudden sea change in European politics: not least, the election of Socialist François Hollande in France, and the stunning breakthrough of anti-austerity leftists in the Greek elections.

Greg Kaufman: Republicans Define ‘Heartlessness’ with Latest Budget Proposals

‘Lower-Priority Spending’ takes on new meaning as Paul Ryan and John Boehner dominate budget debate

When Republican Congressman Paul Ryan released his budget, he charged six House committees with finding $309 billion in spending cuts over ten years in order to avert $55 billion in military cuts scheduled for January 2013 under a bipartisan agreement. He wrote that these cuts would be found in “lower-priority spending.” (pdf)

On Thursday, House Republicans approved the cuts along a party-line vote, revealing exactly what they consider to be “lower-priority spending.” [..]

But for House Republicans, their preferred alternative of cutting lower-priority spending means… a $36 billion cut in food stamps (SNAP), which largely helps the elderly, disabled people, children and the working poor. Two million people would lose their benefits entirely and 44 million would have their benefits reduced-the current average benefit is $4 per person per day. Two hundred and eighty thousand low-income children would also lose automatic access to free school breakfast and lunch. The bill also cuts the SNAP employment and training program by 72 percent, making it more difficult for jobless recipients to find work. It’s important to note that SNAP kept 5 million people from poverty in 2010 and reduced poverty rates by 8 percent in 2009.

James Hansen: Game Over for the Climate

The science of the situation is clear – it’s time for the politics to follow

Global warming isn’t a prediction. It is happening. That is why I was so troubled to read a recent interview with President Obama in Rolling Stone in which he said that Canada would exploit the oil in its vast tar sands reserves “regardless of what we do.”

If Canada proceeds, and we do nothing, it will be game over for the climate.

Canada’s tar sands, deposits of sand saturated with bitumen, contain twice the amount of carbon dioxide emitted by global oil use in our entire history. If we were to fully exploit this new oil source, and continue to burn our conventional oil, gas and coal supplies, concentrations of carbon dioxide in the atmosphere eventually would reach levels higher than in the Pliocene era, more than 2.5 million years ago, when sea level was at least 50 feet higher than it is now. That level of heat-trapping gases would assure that the disintegration of the ice sheets would accelerate out of control. Sea levels would rise and destroy coastal cities. Global temperatures would become intolerable. Twenty to 50 percent of the planet’s species would be driven to extinction. Civilization would be at risk.

Phyllis Bennis: We’re Fighting in a War We Lost Before the War Began

New poll shows support for Afghanistan war lower than ever, and for good reason.

It shouldn’t surprise anyone, but support for the longest U.S. war is dropping further and faster than ever. The latest national U.S. poll, released on May 9, shows 66 percent of Americans are against the war in Afghanistan – with 40 percent “strongly opposed.”

We can expect to hear the usual spin, claims that it’s a hard slog but Afghans are still better off and we have to finish what we started. That only the presence of our brave troops is giving the Afghan government and military the chance to consolidate their rule. That only our troops provide the possibility for stability and security in Afghanistan. That we have to stay to protect Afghan women.

But the reality is people have watched – and paid for – this war for more than eleven years now, and some facts just can’t be spun anymore. Half of the 66 percent who oppose the war say that the presence of U.S. troops is actually hurting the people of Afghanistan more than they are helping. They’re the ones who got it right.