12/15/2014 archive

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Paul Krugman: Wall Street’s Revenge

Dodd-Frank Damaged in the Budget Bill

On Wall Street, 2010 was the year of “Obama rage,” in which financial tycoons went ballistic over the president’s suggestion that some bankers helped cause the financial crisis. They were also, of course, angry about the Dodd-Frank financial reform, which placed some limits on their wheeling and dealing.

The Masters of the Universe, it turns out, are a bunch of whiners. But they’re whiners with war chests, and now they’ve bought themselves a Congress. [..]

And sure enough, Citigroup literally wrote the deregulation language that was inserted into the funding bill.

Again, in itself last week’s action wasn’t decisive. But it was clearly the first skirmish in a war to roll back much if not all of the financial reform. And if you want to know who stands where in this coming war, follow the money: Wall Street is giving mainly to Republicans for a reason.

Trevor Timm: The media treats Dick Cheney like the royals on vacation. He should be in jail

It’s been less than one week since the US Senate released its devastating report on CIA torture and criminality, but if you turned on the television Sunday morning, it looked frighteningly like the year 2002. Virtually all the Sunday talk shows led off not with those who documented the CIA’s depravity, or the victims of such abuse, or those who objected to torture when it wasn’t fashionable to do so. Instead, they instead continued to pump up the former Bush administration architects of this illegal program, so they could once be given a platform to defend it.

The US news media has treated Dick Cheney and Michael Hayden better in interviews this week than they treat British royalty on an American vacation. [..]

From Meet the Press to Morning Joe and elsewhere on the pundit circuit, it’s the deflecting question Bush administration supporters have been sarcastically asking about Obama: Where’s the drone report?

The question is meant as a sardonic insult to avoid any responsibility for the CIA’s crimes during the Bush years, but it’s also a valid one. There should be a comprehensive investigation – right now, rather than a decade from now – into drones. Unfortunately, the people in charge of American accountability on torture are also the CIA’s biggest allies when it comes to American ingenuity in killing.

Just because Obama and Brennan haven’t experienced a reckoning for their robotic assassination program – yet – doesn’t mean we should excuse away the things done in our name now. Dick Cheney belongs in jail, not in a comfy chair on national television. No amount of deflecting will change that.

Welcome to The Breakfast Club! We’re a disorganized group of rebel lefties who hang out and chat if and when we’re not too hungover  we’ve been bailed out we’re not too exhausted from last night’s (CENSORED) the caffeine kicks in. Join us every weekday morning at 9am (ET) and weekend morning at 10:30am (ET) to talk about current news and our boring lives and to make fun of LaEscapee! If we are ever running late, it’s PhilJD’s fault.

This Day in History

Former Nazi official Adolf Eichmann sentenced to death; Bandleader Glenn Miller disappears over the English Channel; The Bill of Rights takes effect; Sioux Indian Chief Sitting Bull killed; Walt Disney dies at age 65.

Breakfast Tunes

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

How ironic that on this very day, Congress and President Barack Obama are about to approve a bill that will essentially violate at least 5 of these amendments and more.

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

December 15 is the 349th day of the year (350th in leap years) in the Gregorian calendar. There are 16 days remaining until the end of the year.

On this day 1791, Virginia becomes the last state to ratify the Bill of Rights, making the first ten amendments to the Constitution law and completing the revolutionary reforms begun by the Declaration of Independence. Before the Massachusetts ratifying convention would accept the Constitution, which they finally did in February 1788, the document’s Federalist supporters had to promise to create a Bill of Rights to be amended to the Constitution immediately upon the creation of a new government under the document.

After the Constitution was ratified in 1789, the 1st United States Congress met in Federal Hall in New York City. Most of the delegates agreed that a “bill of rights” was needed and most of them agreed on the rights they believed should be enumerated.

Madison, at the head of the Virginia delegation of the 1st Congress, had originally opposed a Bill of Rights but hoped to pre-empt a second Constitutional Convention that might have undone the difficult compromises of 1787: a second convention would open the entire Constitution to reconsideration and could undermine the work he and so many others had done in establishing the structure of the United States Government. Writing to Jefferson, he stated, “The friends of the Constitution…wish the revisal to be carried no farther than to supply additional guards for liberty…and are fixed in opposition to the risk of another Convention….It is equally certain that there are others who urge a second Convention with the insidious hope of throwing all things into Confusion, and of subverting the fabric just established, if not the Union itself.”

Madison based much of the Bill of Rights on George Mason’s Virginia Declaration of Rights (1776), which itself had been written with Madison’s input. He carefully considered the state amendment recommendations as well. He looked for recommendations shared by many states to avoid controversy and reduce opposition to the ratification of the future amendments. Additionally, Madison’s work on the Bill of Rights reflected centuries of English law and philosophy, further modified by the principles of the American Revolution.

The eurozone crisis – history is repeating itself … again

Larry Elliott, The Guardian

Sunday 14 December 2014 06.09 EST

Let’s start with Greece, which was where the eurozone crisis began all those years ago. The French statesman Talleyrand once said of the Bourbons that they had learned nothing and forgotten nothing. The same applies to the bunch of incompetents in Brussels, Berlin and Frankfurt responsible for pushing Greece towards economic and political meltdown.

Greece’s recent economic performance has been pretty good. The economy is growing, unemployment is on the decline and the debt to GDP ratio has come down a bit. Time, you might think, to cut Athens a bit of slack. Not if you are the German government, the European commission or the European Central Bank. No, they are insisting on even more austerity and continued surveillance by the International Monetary Fund.

But the Greeks have had a bellyful of austerity. They have had enough of being pushed around. Predictably, support for the anti-austerity Syriza party is strong and the mood is angry. In an attempt to regain the initiative, the government in Athens brought forward the dates for the votes in parliament to elect a new president. If by the time of the third vote at the end of the December, the centre right’s candidate Stavros Dimas, a former EU commissioner, has not secured 180 votes out of 300 – unlikely as things stand – there will be an election that Syriza could win.

The chances of it doing so will certainly be enhanced unless the Bourbon-in-chief, Jean-Claude Juncker, learns when to keep his mouth shut. By saying he wanted “known faces” rather than “extremist forces” in charge in Greece, the European commission president was the perfect recruiting sergeant for Syriza.

The gamble seems to be that Syriza, assuming that there is an election in which it emerges victorious, will either do a U-turn on austerity voluntarily or be forced to do a U-turn due to hostile market reaction. The collapse of a Syriza government will herald the return of a centre-right government who will do what Juncker and Angela Merkel tell them to do.

But this has not been properly thought through. A crisis in Greece will take months to unfold. Bond yields will rise in every eurozone country seen as vulnerable: Portugal, Spain, Italy and, perhaps, Belgium. Business and consumer confidence will be hit. Concerns about the non-performing loans held by Europe’s shaky banks will be reignited.

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A fresh Greek crisis will have spillover effects. It will lead to a fresh recession and deepen deflation. Weak growth and falling prices are a toxic combination for highly indebted countries, because they raise the real value of debts while cutting national output.

Beppe Grillo of Italy’s Five Star Movement has said. “Eventually will come a time when a politician will hold up a copy of the EMU [European Monetary Union] treaty, declare it null and void, and the debt null and void right along with it. That politician will be elected.”

And the moment that politician will be elected may not be all that far away. The only conceivable way to solve some – if not all – of the design flaws in the euro is for a strategy that involves debt forgiveness, expansionary policies in the countries – such as Germany – that can afford it, a large-scale quantitative easing programme from the European Central Bank and much more aggressive attempts to rid the banks of their toxic assets.

Unfortunately, this is not on the table. Eventually, once the crisis is raging, the ECB may well overcome Germany’s misgivings about buying sovereign bonds and dip its toe in the water with a limited QE programme. It will be too little too late, and in any case contingent on further so-called structural reforms, shorthand for wage cuts and the dilution of labour rights.

Mad as Hellas

Paul Krugman, The New York Times

DEC. 11, 2014

The Greek fiscal crisis erupted five years ago, and its side effects continue to inflict immense damage on Europe and the world. But I’m not talking about the side effects you may have in mind – spillovers from Greece’s Great Depression-level slump, or financial contagion to other debtors. No, the truly disastrous effect of the Greek crisis was the way it distorted economic policy, as supposedly serious people around the world rushed to learn the wrong lessons.

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What happened last time, you may recall, was the exploitation of Greece’s woes to change the economic subject. Suddenly, we were supposed to obsess over budget deficits, even if borrowing costs were at historic lows, and slash government spending, even in the face of mass unemployment. Because if we didn’t, you see, we could turn into Greece any day now. “Greece stands as a warning of what happens to countries that lose their credibility,” intoned David Cameron, Britain’s prime minister, as he announced austerity policies in 2010. “We are on the same path as Greece,” declared Representative Paul Ryan, who was soon to become the chairman of the House Budget Committee, that same year.

In reality, Britain and the United States, which borrow in their own currencies, were and are nothing like Greece. If you thought otherwise in 2010, by now year after year of incredibly low interest rates and low inflation should have convinced you.

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(T)he devastation in Greece is awesome to behold. Some press reports I’ve seen seem to suggest that the country has been a malingerer, balking at the harsh measures its situation demands. In reality, it has made huge adjustments – slashing public employment and compensation, cutting back social programs, raising taxes. If you want a sense of the scale of austerity, it would be as if the United States had introduced spending cuts and tax increases amounting to more than $1 trillion a year. Meanwhile, wages in the private sector have plunged. Yet a quarter of the Greek labor force, and half its young, remain unemployed.

Meanwhile, the debt situation has if anything gotten worse, with the ratio of public debt to G.D.P. at a record high – mainly because of falling G.D.P., not rising debt – and with the emergence of a big private debt problem, thanks to deflation and depression. There are some positives; the economy is growing a bit, finally, largely thanks to a revival of tourism. But, over all, it has been many years of suffering for very little reward.

The remarkable thing, given all that, has been the willingness of the Greek public to take it, to accept the claims of the political establishment that the pain is necessary and will eventually lead to recovery. And the news that has roiled Europe these past few days is that the Greeks may have reached their limit. The details are complex, but basically the current government is trying a fairly desperate political maneuver to put off a general election. And, if it fails, the likely winner in that election is Syriza, a party of the left that has demanded a renegotiation of the austerity program, which could lead to a confrontation with Germany and exit from the euro.

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This is what happens when an elite claims the right to rule based on its supposed expertise, its understanding of what must be done – then demonstrates both that it does not, in fact, know what it is doing, and that it is too ideologically rigid to learn from its mistakes.

Repeat after me- Neoliberal Economics Does.  Not.  Work.

James Elmer Mitchell (aka Grayson Swigert) and John Bruce Jessen (aka Hammond Dunbar) are the names of the chief designers of the United States program of torture run by the CIA.

While not responsible for the decision by the United States government to violate its Constitutional and International Treaty obligations (that came directly from the White House, specifically Richard Bruce Cheney aka “Dick” Cheney), they were admittedly responsible for selecting the tortures to be used, oversaw the implementation of those tortures, and actively tortured themselves.

For this they received $81 Million of a $180 Million contract from the United States Government.

These facts are undisputed.

What you may not know that is that James Mitchell was already employed by the CIA’s Office of Technical Services in 2002, from which he was selected to develop the United States Torture Program.  As masters of CIA triva like Valtin remember, this was the same division of the CIA responsible for the MKULTRA program.

MKULTRA was the code name given to an illegal and clandestine program of experiments on human beings, made by the CIA – the Intelligence Service of the United States of America. Experiments on humans were intended to identify and develop drugs and procedures to be used in interrogations and torture, in order to weaken the individual to force confessions through mind control. Organized through the Scientific Intelligence Division of the Central Intelligence Agency (CIA), the project coordinated with the Special Operations Division of the U.S. Army’s Chemical Corps. The program began in the early 1950s, was officially sanctioned in 1953, was reduced in scope in 1964, further curtailed in 1967 and officially halted in 1973. The program engaged in many illegal activities; In particular it used unwitting U.S. and Canadian citizens as its test subjects, which led to controversy regarding its legitimacy. MKUltra used numerous methodologies to manipulate people’s mental states and alter brain functions, including the surreptitious administration of drugs (especially LSD) and other chemicals, hypnosis, sensory deprivation, isolation, verbal and sexual abuse, as well as various forms of torture.

SSCI Report Reveals CIA Torture Program Originated in Same Department as MKULTRA

By: Jeff Kaye, Firedog Lake

Thursday December 11, 2014 12:47 am

The sheer brutality of the program’s use of torture is overwhelming, from the use of forced enemas on detainees – the CIA called it “rectal hydration” and “rectal feeding” – to intense use of solitary confinement, threats to kill prisoners’ families, homicide, and more. Revelations from this report will continue to be reported and absorbed into the world’s understanding of the criminal extent of the U.S. torture program for months or years to come.

But one revelation has gone notably unreported. The man associated with implementing the most brutal part of the interrogation program was drawn out of the same division of the CIA that some decades ago had been responsible for the notorious MKULTRA program. As a CIA history of OTS (.PDF) explains, MKULTRA “involved Agency funding for the testing and use of chemical and biological agents and other means of controlling or modifying human behavior” (p. 19)

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On April 1, 2002, a cable was sent from OTS at the request of the CIA’s Counterterrorism Center and ALEC Station, which was the group within CIA supposedly hunting down Osama bin Ladin, discussing the possible use of “novel interrogation methods” on Abu Zubaydah.

The new proposed interrogation strategy proposed “several environmental modifications to create an atmosphere that enhances the strategic interrogation process.” The cable continued, “[t]he deliberate manipulation of the environment is intended to cause psychological disorientation, and reduced psychological wherewithal for the interrogation,” as well as “the deliberate establishment of psychological dependence upon the interrogator,” and “an increased sense of learned helplessness.”

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(I)t seems more likely, for reasons that will be further explored below, that the program was initiated by OTS itself, and constituted at least in part an experimental program. What exactly the experiment consisted is not totally clear. But it may have involved the use of wireless or other medical devices to measure biological markers of “uncontrollable stress,” in an effort to establish a scientific calibration of torture and overall behavioral or mental control of prisoners. That such a “mind control” effort would originate or be carried out by the same institution that spent millions of dollars on the MKULTRA program is not difficult to believe.

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OTS has been part of the CIA’s Directorate of Science and Technology (DS&T) since the early 1970s. It was transferred from the Directorate of Plans (clandestine operations, renamed around that time, the Directorate of Operations). OTS had earlier gone under other names itself, including Technical Service Staff and Technical Services Division. OTS and its predecessors had been involved in arranging the technical aspect of covert operations, including audio surveillance, forgery, secret writing, spy paraphenalia, sophisticated electronics, and assassination devices.

Then, there was the massive MKULTRA project, which had other names as well, and was coordinated in various ways with similar military programs. MKULTRA had well over a hundred “subprojects,” and contracted with many of the U.S.’s top universities and medical and psychological researchers. (For listing of subprojects see here and here.)

MKULTRA research is probably best known for its use of hallucinogens, like LSD, which were sometimes used on unsuspecting civilians, and resulted in damaged lives and even deaths. Sometimes derided as subject matter for conspiracy theorists, MKULTRA and assorted programs was all-too-real. While the vast majority of its documentation was destroyed by CIA leaders with the program was exposed in the early 1970s, what we do know it terrifying.