08/15/2012 archive

Aug 15 2012

Denial

One factor common to our elite’s failures is their utter and complete unwillingness to accept factual reality.

Eurozone on brink of double-dip recession as growth falls 0.2%

Graeme Wearden, The Guardian

Tuesday 14 August 2012

The eurozone is on the brink of following Britain into a double-dip recession after its economy shrank between April and June.

GDP across the 17-nation bloc fell by 0.2% in the second quarter of this year and economists believe the downturn is continuing. Better-than-expected figures from Germany and France were offset by sharp contractions elsewhere, with the Spanish, Italian, Finnish and Portuguese economies all shrinking. The wider European Union also suffered a 0.2% contraction.

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The UK … shrank by 0.7%, according to last month’s preliminary estimate from the Office for National Statistics.

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In Germany, there was some relief that the economy grew by 0.3%. Analysts, though, fear that Europe’s powerhouse could slide into recession soon.

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With no growth in the last quarter, France has now been flatlining for the last nine months.

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Portugal continued to be buffeted by the austerity programme now being implemented. Its GDP tumbled by 1.2% in the latest quarter and is 3.3% smaller than a year ago, while the unemployment rate crept up to a new record of 15%.

Greek Economy Shrank 6.2% in Second Quarter

By DAVID JOLLY, The New York Times

Published: August 13, 2012

(M)any economists were skeptical that the heavily indebted Greek state can cut its way out of crippling recession.

A shrinking economy creates pressure for further budget cuts, since the deficit and debt grow as a percentage of the overall economy.

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Standard & Poor’s estimated last week that the Greek economy would shrink 10 percent to 11 percent cumulatively this year and next, compared with the 4 percent to 5 percent decline the European Union and International Monetary Fund assume.

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“(W)e’ve long argued that that is a fantasy,” Mr. May (economist at Capital Economics) said. “Greece will have to go through a long recession if it’s going to remain in the euro zone.”

He said Greece needed a 30 percent to 40 percent decline in real wages to restore its competitiveness, a punishing prospect if accomplished as a member of the euro. He said the better alternative might be for Greece to leave the euro and accomplish the same goal with a devalued currency.

US economic recovery is weakest since World War II

By Paul Wiseman, Associated Press

1 hour 50 minutes ago

Economic growth has never been weaker in a postwar recovery. Consumer spending has never been so slack. Only once has job growth been slower.

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Europe’s troubles have undermined consumer and business confidence on both sides of the Atlantic. And the deeply divided U.S. political system has delivered growth-chilling uncertainty.

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America’s gross domestic product – the broadest measure of economic output – grew 6.8 percent from the April-June quarter of 2009 through the same quarter this year, the slowest in the first three years of a postwar recovery. GDP grew an average of 15.5 percent in the first three years of the eight other comebacks analyzed.

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Government spending and investment at the federal, state and local levels was 4.5 percent lower in the second quarter than three years earlier.

Three years into previous postwar recoveries, government spending had risen an average 12.5 percent. In the first three years after the 1981-82 recession, during President Ronald Reagan’s first term, the economy got a jolt from a 15 percent increase in government spending and investment.

This time, state and local governments have been slashing spending – and jobs.

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Since June 2009, governments at all levels have slashed 642,000 jobs, the only time government employment has fallen in the three years after a recession.

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Consumer spending has grown just 6.5 percent since the recession ended, feeblest in a postwar recovery. In the first three years of previous recoveries, spending rose an average of nearly 14 percent.

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The economy shed a staggering 8.8 million jobs during and shortly after the recession. Since employment hit bottom, the economy has created just over 4 million jobs. So the new hiring has replaced 46 percent of the lost jobs, by far the worst performance since World War II. In the previous eight recoveries, the economy had regained more than 350 percent of the jobs lost, on average.

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Never before have so many Americans been unemployed for so long three years into a recovery. Nearly 5.2 million have been out of work for six months or more. The long-term unemployed account for 41 percent of the jobless; the highest mark in the other recoveries was 22 percent.

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(P)ay raises haven’t kept up with even modest levels of inflation. Earnings for production and nonsupervisory workers – a category that covers about 80 percent of the private, nonfarm workforce – have risen just over 6.2 percent since June 2009. Consumer prices have risen nearly 7.2 percent. Adjusted for inflation, wages have fallen 0.8 percent. In the previous five recoveries -the records go back only to 1964 - real wages had gone up an average 1.5 percent at this point.

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Washington isn’t doing much to help the economy. An impasse between Obama and congressional Republicans brought the U.S. to the brink of default on the federal debt last year -a confrontation that rattled financial markets and sapped consumer and business confidence.

Given the political divide, businesses and consumers don’t know what’s going to happen to taxes, government spending or regulation. Sharp tax increases and spending cuts are scheduled to kick in at year’s end unless Congress and the White House reach a budget deal.

In the meantime, it’s difficult for consumers to summon the confidence to spend and businesses the confidence to hire and expand. Never in the postwar period has there been so much uncertainty about what policymakers will do, says Steven Davis, an economist at the University of Chicago Booth School of Business: “No one is sure what will actually happen.”

Voodoo Supply Side Economics does not work.  Period.  It is faith based Mammon worship by the greedy and evil.

Aug 15 2012

Trapwire: Worse Than 1984

The recent release of e-mails from STRATFOR, a right wing global intelligence company, and documents about the surveillance system Trapwire by Wikileaks, has become the talk of the web and Twitter. David Seaman, an up and coming new media advocate and host of The DL Show, explains everything you need to know about Trapwire:

Anyway, here’s what Trapwire is, according to Russian-state owned media network RT (apologies for citing “foreign media”… if we had a free press, I’d be citing something published here by an American media conglomerate): “Former senior intelligence officials have created a detailed surveillance system more accurate than modern facial recognition technology-and have installed it across the U.S. under the radar of most Americans, according to emails hacked by Anonymous.

Every few seconds, data picked up at surveillance points in major cities and landmarks across the United States are recorded digitally on the spot, then encrypted and instantaneously delivered to a fortified central database center at an undisclosed location to be aggregated with other intelligence. It’s part of a program called TrapWire and it’s the brainchild of the Abraxas, a Northern Virginia company staffed with elite from America’s intelligence community. [..]

So: those spooky new “circular” dark globe cameras installed in your neighborhood park, town, or city-they aren’t just passively monitoring. They’re plugged into Trapwire and they are potentially monitoring every single person via facial recognition. [..]

In related news, the Obama administration is fighting in federal court this week for the ability to imprison American citizens under NDAA’s indefinite detention provisions-and anyone else-without charge or trial, on suspicion alone.

So we have a widespread network of surveillance cameras across America monitoring us and reporting suspicious activity back to a centralized analysis center, mixed in with the ability to imprison people via military force on the basis of suspicious activity alone.

The Young Turks’ host Cenk Uygur breaks down what Trapwire is and why it is a danger to individual freedom.

Noah Shachtman at The Danger Room takes an in depth look at the “sleazy” connection of STRATFOR to Trapwire and the CIA:

On Nov. 4, 2009, Fred Burton, the vice president of the private intelligence firm Stratfor, co-wrote an essay on emerging terrorist threats and the means to stop them. Particularly impressive, Burton wrote, was a new software tool called Trapwire, which works “with camera systems to help detect patterns of preoperational surveillance … to help cut through the fog of noise and activity and draw attention to potential threats.” [..]

What his customers reading that November 2009 essay may not have realized was that Burton was also marketing them a product. On Aug. 17 of that year, Stratfor and Trapwire signed a contract (.pdf) giving Burton’s company an 8 percent referral fee for any business they send Trapwire’s way. The essay was partially a sales pitch – a fact that Burton neglected to mention. [..]

That’s a breach of trust and possibly worse, says Matthew Aid, author of Intel Wars: The Secret History of the Fight Against Terror. “It’s a conflict of interest.” [..]

Stratfor’s now-famous business partner, Trapwire Inc., began as a division of Abraxas Corporation, one of the more prominent intelligence contractors to crop up after the 9/11 attacks. Begun by Richard “Hollis” Helms, the former head of the CIA’s European division, the company grew so quickly that by 2005, Helms boasted it was “the largest aggregate of analytical counter-terrorism capabilities outside of the U.S. government.” The CIA began entrusting Abraxas with one of its most sensitive tasks: constructing false identities, front companies, and cover stories for agents traveling overseas. At one point, so many CIA employees were jumping ship for Abraxas that the director of the CIA asked it, and a handful of other firms, to stop recruiting in the agency cafeteria.

Today, contractors make up about one-third of the 845,000 people with top-secret security clearances in this country, the Washington Post estimates. It’s safe to assume that at least the same portion of the $80 billion annual intelligence budget goes to these outside firms. The Post counted 1,931 private companies in nearly 10,000 locations across America working on counterterrorism, homeland security and intelligence efforts.

TrapWire is already used in New York, Los Angeles, Las Vegas, Texas, DC, London, and other locales around the USA. Although a spokesperson from NYPD denies that they are using Trapwire, there are other companies that are doing the same surveillance that are just as sinister. Remember that NYPD has labeled people “professional agitators” for filming their activities but now they have a tool that can be used to shut down peaceful demonstration and association. It could be easily used to violate the First and Fourth Amendment rights of citizens wherever this type of surveillance is used.

Aug 15 2012

Punting the Pundits

“Punting the Pundits” is an Open Thread. It is a selection of editorials and opinions from around the news medium and the internet blogs. The intent is to provide a forum for your reactions and opinions, not just to the opinions presented, but to what ever you find important.

Thanks to ek hornbeck, click on the link and you can access all the past “Punting the Pundits”.

Wednesday is Ladies’ Day

Follow us on Twitter @StarsHollowGzt

Katrina vanden Heuvel: Paul Ryan: Cruel, Not Courageous

A word of advice: If you’re announcing the most radical and reactionary Republican ticket in half a century, don’t do it on a ship named for the birthplace of progressivism, to Aaron Copland’s “Fanfare for the Common Man.”

But that is precisely the kind of audacity congressman-turned-vice presidential-nominee Paul Ryan brings to the flailing Romney campaign. Courage! Vision! And that hair! (Within minutes of the announcement, @VPRyansCowlick boasted dozens of follicle-fixated followers.)

Ryan is the rare Washington pseudo-wonk described by serious people of both parties in the adulatory terms typically reserved for battlefield heroics. “Courageous.” “Politically gutsy.” Author of “the most comprehensive and most courageous budget reform proposal”-wait for it-“in our lifetimes.” He is Jimmy Stewart, if Mr. Smith had spent less time establishing a boys’ camp and more time pretending to pay down the debt, one food stamp at a time.

Therein lies the rub. Ryan’s budget isn’t courageous-it’s just cruel. Three-fifths of the cuts he wants would hit those with low incomes, while those who have the most would continue getting more. It’s no wonder the former altar boy has had his knuckles rapped by a group of nuns for peddling a budget that “rejects church teaching about solidarity, inequality, the choice for the poor, and the common good.”

Bryce Covert: Paul Ryan’s Budget Deals a Body Blow to Women’s Bottom Line

You’d have to live under a rock to miss the news on Saturday morning that Mitt Romney has picked Congressman Paul Ryan to be his running mate. The announcement immediately kicked up a flurry of speculation: what does Ryan bring to the ticket that Romney wants? One thing he does not bring: women’s votes. Mitt Romney has been dogged by a problem with female voters, lagging in their support far behind President Obama, particularly among single women. But where Romney has been vague and flip-floppish on many issues, Ryan has long been very clear about his staunch support for policies that will hurt women economically.

Most people know Paul Ryan for his budget plans. There’s plenty of pain to be found in his budget for the lower and middle class, but women in particular make out poorly (literally) if his budget gets a presidential signature. Add in other policies he’s proposed or supported, and the picture becomes even bleaker.

Laura Flanders; Bill Moyers: For Campaign Cash, TV Gives Back Nothing

I had the opportunity to interview author and broadcaster Bill Moyers last year, just before his latest TV show launched. Then, we were a full year ahead of the presidential election. Now, as we head into the cable-news crush called convention season, I watched our conversation again. It’s even more pointed now. Says Moyers: “The scandal (one part of the scandal), is local television stations make enormous sums of money from all of the campaigning that goes on every two or fours years… and they give back nothing for that… Nothing. They should be giving “free time” to the candidates that have real debate with citizens and answer questions. Instead they write carefully manufactured commercials that are exploitive and misleading and demeaning.”

Read Moyers, and then read this speech from Newton Minnow, then chair of the Federal Communication Commission. Minnow said it best, when he said it 1961: “In a time of peril and opportunity, the old complacent, unbalanced fare of action-adventure and situation comedies is simply not good enough.”

Today, cable news has turned our elections themselves into unbalanced action adventures or worse, situation comedies. And public television, barring shows like Moyers’ own, is barely keeping afloat – or keeping anyone awake.  Given our situation as a nation, maybe the last word should be tragedies.

Terry Tempest Williams: A Generational Stance on Behalf of the Arctic Ocean

In less than a week, the Obama administration may well approve Shell Oil’s plans to do exploratory drilling in America’s Arctic Ocean. It would be an unmitigated disaster because there is no proven way to clean up an oil spill in the harshness of Arctic conditions. It should be stopped.

We must resist and insist that President Obama and Secretary Salazar deny this drilling permit to Shell Oil on two points: The Department of Interior has refused to issue an environmental impact statement to access the risks, impacts, and potential damages that Shell Oil’s drilling plan might have on the fragile and complex ocean environment and its inhabitants. Instead, the Bureau of Ocean Energy Management, Regulation and Enforcement has issued what is called a “Finding of No Significant Impact. This is a lie. 2) Shell Oil has not been able to produce a comprehensive strategy or plan of action, by their own admission, outlining their what they would do should an oil spill occur in Arctic waters.

Katha Politt: Gun Control? Dream On.

Why am I even bothering to write about gun control? That was going to be my opening sentence when this column was to be focused on the Aurora, Colorado, movie-theater massacre: twelve people murdered and fifty-eight wounded, some very severely, by James Holmes, demented neuroscience graduate student. Then came the massacre at the Sikh temple in Oak Creek, Wisconsin: six killed and three wounded by Wade Michael Page, 40-year-old white supremacist and leader of a racist hardcore band called End Apathy. And even after this horrific crime, which the FBI is calling “domestic terrorism,” my opening is the same: Why am I even bothering to write about gun control? End apathy? Fat chance. If even the shooting of Gabrielle Giffords, one of Congress’s own, by Jared Loughner, another hyperarmed madman, didn’t move her pro-gun colleagues or their constituents, nothing will.

Remember the Million Mom March? In May 2000, 750,000 women gathered on the National Mall to call for what are often referred to as “reasonable” controls on guns, like background checks at gun shows and handgun registration (as opposed to “unreasonable” curbs like making it illegal to buy weapons intended to kill people-for example, handguns or AK-47s, let alone 6,000 rounds of ammunition on the Internet). Today you might as well stand on the Mall and sing “Where Have All the Flowers Gone?”

Ellen Brown: Saving the Post Office: Letter Carriers Consider Bringing Back Banking Services

On July 27, 2012, the National Association of Letter Carriers adopted a resolution at their National Convention in Minneapolis to investigate establishing a postal banking system.  The resolution noted that expanding postal services and developing new sources of revenue are important to the effort to save the public Post Office and preserve living-wage jobs; that many countries have a successful history of postal banking, including Germany, France, Italy, Japan, and the United States itself; and that postal banks could serve the 9 million people who don’t have bank accounts and the 21 million who use usurious check cashers, giving low-income people access to a safe banking system.  “A USPS bank would offer a ‘public option’ for banking,” concluded the resolution, “providing basic checking and savings – and no complex financial wheeling and dealing.”

The USPS has been declared insolvent, but it is not because it is inefficient (it has been self-funded throughout its history).  It is because in 2006, Congress required it to prefund postal retiree health benefits for 75 years into the future, an onerous burden no other public or private company is required to carry.  The USPS has evidently been targeted by a plutocratic Congress bent on destroying the most powerful unions and privatizing all public services, including education.  Britain’s 150-year-old postal service is also on the privatization chopping block, and its postal workers have also vowed to fight.  Adding banking services is an internationally proven way to maintain post office solvency and profitability.

Medea Benjamin: At Drone Convention, Zero Tolerance for Peace

When are we, as a nation, going to have a frank discussion about drones and remote-controlled killing? One might think that such a dialogue could take place when thousands of people come together, once a year, at the gathering of the Association of Unmanned Vehicle Systems International (AUVSI). Wrong.

But AUVSI, the lobby group for the drone industry, brooked no dissent at its August 6-9 Las Vegas Convention. When I, as author of a new book Drone Warfare: Killing by Remote Control, tried to rent a room at the Convention Center to give a presentation on my book, AUVSI vetoed my request. When I tried to register as a journalist, I was told that I did not meet their criteria, but they refused to say what that criteria was. And after registering online as a normal participant and paying the $200 fee, when I appeared to get my badge I was yanked off the line, surrounded by police, and told I would be arrested if I set foot in the Convention Center during the duration of the gathering.

Aug 15 2012

On This Day In History August 15

This is your morning Open Thread. Pour your favorite beverage and review the past and comment on the future.

Find the past “On This Day in History” here.

August 15 is the 227th day of the year (228th in leap years) in the Gregorian calendar. There are 138 days remaining until the end of the year.

While there were many significant events that happened on August 15, the most delightful and happily remember is Woodstock. Not many of my Baby Boomer generation remember that today Emperor Hirohito announced the unconditional surrender of Japan or that East Germany began the building of the Berlin Wall or that Malcolm slain Macbeth, it was peace, love and Rock N’ Roll in the mud with a lack of sanitary facilities but lots of music from some of the best at the Woodstock Festivalduring the weekend of August 15 to 18, 1969. The site was a dairy farm in West Lake, NY near the town of Bethel in Sullivan County, some 43 miles southwest from the actual town of Woodstock in Ulster County. During that rainy weekend some 500,000 concert goers became a pivotal moment in the history of Rock and Roll.

Peace, Drugs and Rock N’Roll. Rock On.

Aug 15 2012

CNN Host Does Her Homework

I have to admit that I very rarely watch CNN these days but today while reading through the posts at Crooks & Liars, I may have to consider watching Soledad O’Brien. Most of the this morning Romney surrogate John Sununu was spouting half truths and bold faced lies about Medicare and the Romney/Ryan budget proposal that would leave seniors with a fixed voucher for private insurance. When he tried to spew the same talking points to Ms. O’Brien on her CNN show Starting Point with Soledad O’Brien, he found himself in a debate with someone who had done her homework:

You can read the transcript of the exchange here

Sununu had been making the rounds of talk shows for several days spouting the same talking points virtually unchallenged. He even, rudely, out shouted Andrea Mitchell on her MSNBC show who was not as well prepared to counter the debunked party line.

Apparently this was not the first encounter that Ms. O’Brien had with a Romney/Ryan camp spokesperson. While subbing for Anderson Cooper Monday night on CNN’s 360° she cut off spokesperson Barbara Comstock when Comstock spouted the nonsense lie that $700 billion has somehow been “stolen” from Medicare. As soon as Comstock realized that she wasn’t getting away with that talking point she fell back on the debunked canard of “death panels.” Of course the right wing is having a field day with this because they claim that O’Brien was taking her argument from a left wing blog and siting Obama talking points. That’s the best they can do to counter Ms. O’Brien’s accurate fact checking.

It is good to see a news anchor on cable doing their job. Perhaps David Gregory, Chris Matthews, et al should take a page from Ms. O’Brien’s book. I should watch CNN in the morning more often.

Aug 15 2012

SBC Settles with NYS Regulator

No agreement is perfect but the settlement that was reached Tuesday afternoon with the New York Department of Financial Services over Standard Charter Bank’s illicit money laundering with Iran and other countries under sanctions was better than most. In particular, SBC’s admission that the “the conduct at issue involved transactions of at least $250 billion.” The fine of $340 million was larger than the $250 million SBC offered but smaller than either the $700 million to $1 billion that SBC might have had to pay if the case had gone to a hearing on Wednesday and large because of the multi-billion dollar transaction admission. So the agreement is being touted as a victory for Benjamin M. Lawsky and his 10-month old agency, the New York Department of Financial Services which took on the bank without the Federal agencies who have been negotiating with SBC.

Yves Smith at naked capitalism has the statement from Mr. Lawsky:

STATEMENT FROM BENJAMIN M. LAWSKY, SUPERINTENDENT OF FINANCIAL SERVICES, REGARDING STANDARD CHARTERED BANK

   Benjamin M. Lawsky, New York Superintendent of Financial Services, issued the following statement today.

   “The New York State Department of Financial Services (“DFS”) and Standard Chartered Bank (“Bank”) have reached an agreement to settle the matters raised in the DFS Order dated August 6, 2012. The parties have agreed that the conduct at issue involved transactions of at least $250 billion.

   “The settlement also includes the following terms:

       

  • The Bank shall pay a civil penalty of $340 million to the New York State Department of Financial Services.
  • The Bank shall install a monitor for a term of at least two years who will report directly to DFS and who will evaluate the money-laundering risk controls in the New York branch and implementation of appropriate corrective measures. In addition, DFS examiners shall be placed on site at the Bank.
  • The Bank shall permanently install personnel within its New York branch to oversee and audit any offshore money-laundering due diligence and monitoring undertaken by the Bank.

   “The hearing scheduled for August 15, 2012 is adjourned.

   “We will continue to work with our federal and state partners on this matter.”

This settlement is only with the New York regulator and it includes the transfers with Libya, Mynmar and the Sudan.

While this could have been better, Mr. Lawsky did get the bank to concede that the transfer did indeed involve the $250 billion which resulted in a larger settlement. SBC still must deal with the federal regulators based on the concession with NYDF. As David Dayen at FDL sees it this put a whole new slant on those talks:

In addition, this does not end the legal trouble for Standard Chartered. This only resolves the issues with the New York Department of Financial Services. Federal regulators (including Treasury, the Federal Reserve and the Justice Department) as well as the Manhattan District Attorney must now enter into their negotiations, and if they cannot get as much as the DFS, it will be completely embarrassing. This could cost Standard Chartered at least double this initial figure.

Meanwhile over at the SEC, Wells Fargo walks away from mortgage investment case with a $6.5 million fine and no admission of wrongdoing as usual. Wells Fargo earned $16 billion last year.

The Securities and Exchange Commission has spent nearly four years building cases against the nation’s biggest banks for their role in the mortgage mess.The agency has filed civil actions against Goldman Sachs, JPMorgan Chase and Citigroup.

But in recent months, the agency has struggled to bring big cases as it pursued a second round of investigations focused on the banks’ failure to disclose the dangers of mortgage securities. The Wells Fargo case comes just days after Goldman Sachs revealed that the S.E.C. had closed an investigation into a 2006 mortgage deal without pursuing charges. [..]

The action also cited Shawn McMurtry, a former vice president and broker at the bank, over his role in selling the deals. Under the settlement, Mr. McMurtry agreed to a $25,000 fine and six-month suspension from the securities industry.

I’m sure Mr. McMurtry can afford it.