“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.
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Dean Baker: A year after being discredited, austerity economics still reigns
The world still hasn’t learned its lesson from the Reinhart-Rogoff debacle
It has been a bit more than a year since the Excel spreadsheet error that shook the world. For those who may have missed it, in April of 2013, Thomas Herndon, a University of Massachusetts graduate student in economics, found an error in the calculations of Harvard professors Carmen Reinhart and Ken Rogoff on the relationship between government debt and economic growth.
Reinhart and Rogoff had done an enormously influential analysis showing that countries experienced sharply slower growth once their debt-to-GDP ratio exceeded 90 percent. With the United States and many European countries reaching debt-to-GDP ratios in this 90 percent range in the wake of the Great Recession, Reinhart and Rogoff’s work was seen as a warning. It was taken as evidence that governments would have to reduce spending, raise taxes or both to get or stay below the 90 percent threshold.
Political leaders and central bankers around the world were happy to trumpet the Reinhart-Rogoff findings. The story was that cutting deficits may slow growth in the short term and seriously hurt those directly affected by the cuts, such as laid-off government workers, but it was essential medicine for sustaining a healthy economy.
David Cay Johnston: Enron-style price gouging is making a comeback
Wall Street makes naked attempt to jack up electricity prices in New England
The price of electricity would soar under the latest scheme by Wall Street financial engineers to game the electricity markets.
If regulators side with Wall Street – and indications are that they will – expect the cost of electricity to rise from Maine to California as others duplicate this scheme to manipulate the markets, as Enron did on the West Coast 14 years ago, before the electricity-trading company collapsed under allegations of accounting fraud and corruption.
The test case is playing out in New England. Energy Capital Partners, an investment group that uses tax-avoiding offshore investing techniques and has deep ties to Goldman Sachs, paid $650 million last year to acquire three generating plant complexes, including the second largest electric power plant in New England, Brayton Point in Massachusetts.
Five weeks after the deal closed, Energy partners moved to shutter Brayton Point. Why would anyone spend hundreds of millions of dollars to buy the second largest electric power plant in New England and then quickly take steps to shut it down?
On Friday we learned that a lot of Republican U.S. senators and a smattering of Democrats are once again trying to make an end run around a legitimate process to assess the impacts of the Keystone XL tar sands pipeline, in favor of moving legislation authorizing its immediate construction.
While the political process in Washington, D.C., has come to give a lot of us pause, the good news is, it only furthers the resolve of tens of thousands of Americans to work harder to make their voices heard. [..]
So it is particularly painful to see some members of Congress once again trying to circumvent a legitimate process to push approval of Keystone XL — a pipeline that would take some of the world’s dirtiest oil from Canada, through the heart of America, to the Gulf Coast and then off to overseas markets.
Brian Krebs: What Target and Co aren’t telling you: your credit card data is still out there
Hackers have an open window that no fallen CEO has bothered to close, because the retail industry is looking for security in all the wrong places
Target wants you to know that you can trust it again. Nearly seven months after the second biggest retailer in America ignored multiple alarm bells, allowing thieves to virtually hijack the cash registers at some 1,800 stores and siphon at least 40m credit and debit card records plus contact info for more than 70m customers, CEO Gregg Steinhafel is out, and the company has pledged to spend $100m upgrading the security of its checkout system.
But Monday’s mea culpa papers over problems still endemic throughout the American retail industry: an over-reliance on in-store technology rather than cybersecurity experts in the boardroom, and a tendency to underestimate the lengths to which bad guys will go to steal anything that isn’t properly nailed down.
Robert Reich: The Four Biggest Right-Wing Lies About Inequality
Even though French economist Thomas Piketty has made an air-tight case that we’re heading toward levels of inequality not seen since the days of the nineteenth-century robber barons, right-wing conservatives haven’t stopped lying about what’s happening and what to do about it.
Herewith, the four biggest right-wing lies about inequality, followed by the truth. [..]
The truth is, America’s lurch toward widening inequality can be reversed. But doing so will require bold political steps.
At the least, the rich must pay higher taxes in order to pay for better-quality education for kids from poor and middle-class families. Labor unions must be strengthened, especially in lower-wage occupations, in order to give workers the bargaining power they need to get better pay. And the minimum wage must be raised.
Don’t listen to the right-wing lies about inequality. Know the truth, and act on it.
Ban Ki-moon: Climate change affects us all. So what’s stopping us joining forces to act on it?
I have seen that effective, affordable climate solutions exist. The push-back against sceptics must start in earnest at the UN’s 2014 summit in New York
Three decades from now the world is going to be a very different place. How it looks will depend on actions we take today. We have big decisions to make and little time to make them if we are to provide stability and greater prosperity to the world’s growing population. Top of the priority list is climate change.
All around the world it is plain that climate change is happening and that human activities are the principal cause. Last month the Intergovernmental Panel on Climate Change confirmed that the effects of climate change are already widespread, costly and consequential – from the tropics to the poles, from small islands to large continents, and from the poorest countries to the wealthiest. The world’s top scientists are clear. Climate change is affecting agriculture, water resources, human health, and ecosystems on land and in the oceans. It poses sweeping risks for economic stability and the security of nations.
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