06/09/2015 archive

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”.

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Dean Baker: The Trade Deficit and the Weak Job Market

The basic story should be familiar to anyone who has suffered through an intro economics course. There are four basic sources of demand in the economy: consumption, investment, government spending, and net exports. “Net exports” refers to the excess of exports over imports. If we export more than we import so that net exports are positive, then they add to demand in the economy. This means that in addition to the demand we generate domestically, trade is increasing demand in the economy.

However when we have a trade deficit and we import more than we export, trade is reducing demand in the economy. A portion of the demand being generated domestically is being filled by goods and services that are produced in other countries. From the standpoint of generating demand in the U.S. economy an annual trade deficit of $500 billion has the same impact as consumers taking $500 billion out of their paychecks each year and stuffing it under their mattress.

Joseph E. Stiglitz: Will a Grexit Be the Lehman-Like Trigger of the Next Global Financial Crisis?

European Union leaders continue to play a game of brinkmanship with the Greek government. Greece has met its creditors’ demands far more than halfway. Yet Germany and Greece’s other creditors continue to demand that the country sign on to a program that has proven to be a failure, and that few economists ever thought could, would or should be implemented.

The swing in Greece’s fiscal position from a large primary deficit to a surplus was almost unprecedented, but the demand that the country achieve a primary surplus of 4.5 percent of GDP was unconscionable. Unfortunately, at the time that the “troika” — the European Commission, the European Central Bank and the International Monetary Fund — first included this irresponsible demand in the international financial program for Greece, the country’s authorities had no choice but to accede to it.

The folly of continuing to pursue this program is particularly acute now, given the 25 percent decline in GDP that Greece has endured since the beginning of the crisis. The troika badly misjudged the macroeconomic effects of the program that they imposed. According to their published forecasts, they believed that, by cutting wages and accepting other austerity measures, Greek exports would increase and the economy would quickly return to growth. They also believed that the first debt restructuring would lead to debt sustainability.

Michael Brenner: The NSA’s Second Coming

Americans have acquired a fondness for worlds of make-believe. Torture was done by “a few bad apples.” Or, we must await the “verdict of history” to judge how our invasion of Iraq turned out. Or, America is besieged by hordes of crazed Islamist terrorists scaling the walls and dedicated to surpassing the horror of 9/11. Or, The Sniper salvaged American dignity and self-respect from that tragic fiasco. Or, that it was a brilliant CIA and valiant Seals who avenged a righteous America by storming Abbottabad to assassinate an infirmed old man in his bed.

This last is one of the threads of make-believe woven into the fabricated narrative about the Congressional psycho-drama this past week over electronic spying on Americans. That engrossing campfire tale has our noble representatives struggling to find the path of Solomonic wisdom that walks a tightrope between security and liberty. We awaited in suspense to see if the perilous feat would reach its goal. We agonized at word of the NSA being forced by obedience to the Law to shut down its all-seeing networks — thereby, for a few hours, leaving America exposed to the diabolical schemes of the bearded devils. The White House warned that we are playing “Russian roulette” with the country’s very survival. No one pressed the question of all six chambers in fact being uncharged.

Steven W. Thrasher: Black children are not even safe from police violence at a pool party

Over the weekend, a video surfaced that showed police in McKinney, Texas violently controlling kids on a suburban street and pulling a gun on a young black girl. After I heard about it, it took a few hours before I could screw up the courage to watch it, because I knew it would make me cry. And it did.

The video made me cry because it showed me how black children are not allowed to play. How they’re not allowed to just be fucking kids. How their play becomes criminalized and how they’re socialized to become black adults who internalize that their very breathing selves are criminal.

The video (and the follow up interview with its videographer, Brandon Brooks) made me cry because they showed how a public space like a pool becomes the domain of a security guard with no accountability. Who calls the police. Who quickly assume guilt on every black child in sight.

It made me cry to see a gun pulled on these children. I only had a police officer begin to pull a gun on me once, but it scared the shit out of me and altered my interactions with police forever – and I was an adult. How scarred will these children be after such trauma?

Chris Weigant: SCOTUS Optimism

For political wonks, June is not the month to celebrate grads, dads, and brides, but instead the biggest SCOTUS month of the year. SCOTUS (for the un-wonky) stands for “Supreme Court Of The United States.” June marks the end of the Supreme Court’s yearly session, and it is when all the biggest decisions get handed down. [..]

Now, guessing which way the court will rule is always a risky proposition. Some even call it a fool’s game. Nevertheless, I’m going to go out on a limb today in a burst of (perhaps) foolish optimism, and predict that both decisions will actually be good news. We’ve already seen a flurry of “sky is going to fall” stories (especially over King) from liberals in the media, and my guess is that this trend is only going to increase, the closer we get to the end of the month. So I thought one article from a more optimistic perspective might be appreciated — even if my guesses turn out to be utterly wrong, in the end. That, of course, is always the risk you run when going out on a limb during SCOTUS season. Time will tell whether I’m right or wrong, but for now, here’s my take on these two cases, seen mostly through the lens of politics.

If You Thought TPP Was Bad, You Haven’t Read TISA

The Trade Promotion Authority Act (TPA), aka Fast Track, that the president and the corporatist congress are pushing, covers more than just the TPP.  It will also apply to the equally terrible European TTIP & the Trade In Service Agreement that has just been uncovered by Wikileaks. If you thought TPP was bad, you haven’t read the Trade In service Agreement. This “trade” agreement is a corporate friendly document that would reshape how everyone in the world does business.

Secret Trade in Services Agreement (TISA) – Financial Services Annex 2014-06-19

Today, WikiLeaks released the secret draft text for the Trade in Services Agreement (TISA) Financial Services Annex, which covers 50 countries and 68.2%1 of world trade in services. The US and the EU are the main proponents of the agreement, and the authors of most joint changes, which also covers cross-border data flow. In a significant anti-transparency manoeuvre by the parties, the draft has been classified to keep it secret not just during the negotiations but for five years after the TISA enters into force.

Despite the failures in financial regulation evident during the 2007-2008 Global Financial Crisis and calls for improvement of relevant regulatory structures2, proponents of TISA aim to further deregulate global financial services markets. The draft Financial Services Annex sets rules which would assist the expansion of financial multi-nationals – mainly headquartered in New York, London, Paris and Frankfurt – into other nations by preventing regulatory barriers. The leaked draft also shows that the US is particularly keen on boosting cross-border data flow, which would allow uninhibited exchange of personal and financial data.

TISA negotiations are currently taking place outside of the General Agreement on Trade in Services (GATS) and the World Trade Organization (WTO) framework. However, the Agreement is being crafted to be compatible with GATS so that a critical mass of participants will be able to pressure remaining WTO members to sign on in the future. Conspicuously absent from the 50 countries covered by the negotiations are the BRICS countries of Brazil, Russia, India and China. The exclusive nature of TISA will weaken their position in future services negotiations.

The draft text comes from the April 2014 negotiation round – the sixth round since the first held in April 2013. The next round of negotiations will take place on 23-27 June in Geneva, Switzerland.

Current WTO parties negotiating TISA are: Australia, Canada, Chile, Chinese Taipei (Taiwan), Colombia, Costa Rica, Hong Kong, Iceland, Israel, Japan, Liechtenstein, Mexico, New Zealand, Norway, Pakistan, Panama, Paraguay, Peru, South Korea, Switzerland, Turkey, the United States, and the European Union, which includes its 28 member states Austria, Belgium, Bulgaria, Cyprus, Croatia, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, and the United Kingdom.

China and Uruguay have expressed interest in joining the negotiations but so far are not included.

1] Swiss National Center for Competence in Research: [A Plurilateral Agenda for Services?: Assessing the Case for a Trade in Services Agreement (pdf), Working Paper No. 2013/29, May 2013, p. 10.

2] For example, in June 2012 Ecuador [tabled a discussion (pdf) on re-thinking regulation and GATS rules; in September 2009 the Commission of Experts on Reforms of the International Monetary and Financial System, convened by the President of the United Nations and chaired by Joseph Stiglitz, released its final report (pdf), stating that “All trade agreements need to be reviewed to ensure that they are consistent with the need for an inclusive and comprehensive international regulatory framework which is conducive to crisis prevention and management, counter-cyclical and prudential safeguards, development, and inclusive finance.”

Read the Secret Trade in Services Agreement (TISA) – Financial Services Annex

Read the Analysis Article – Secret Trade in Services Agreement (TISA) – Financial Services Annex

Experts are still pouring over the documents but here is some of the preliminary analysis of what TISA will effect:

Wednesday’s leak provides the largest window yet into TISA and comes on the heels of two other leaks about the accord last year, the first from WikiLeaks and the other from the Associated Whistleblowing Press, a non-profit organization with local platforms in Iceland and Spain.

While analysts are still poring over the contents of the new revelations, civil society organizations released some preliminary analysis of the accord’s potential implications for transportation, communication, democratic controls, and non-participating nations

   Telecommunications: “The leaked telecommunications annex, among others, demonstrate potentially grave impacts for deregulation of state owned enterprises like their national telephone company,” wrote the global network Our World Is Not for Sale (OWINFS) in a statement issued Wednesday.

   Transportation: The International Transport Workers’ Federation (ITF), comprised of roughly 700 unions from more than 150 countries, warned on Wednesday that the just-published documents “foresee consolidated power for big transport industry players and threaten the public interest, jobs and a voice for workers.” ITF president Paddy Crumlin said: “This text would supercharge the most powerful companies in the transport industry, giving them preferential treatment. What’s missing from this equation is any value at all for workers and citizens.”

   Bypassing democratic regulations: “Preliminary analysis notes that the goal of domestic regulation texts is to remove domestic policies, laws and regulations that make it harder for transnational corporations to sell their services in other countries (actually or virtually), to dominate their local suppliers, and to maximize their profits and withdraw their investment, services and profits at will,” writes OWINFS. “Since this requires restricting the right of governments to regulate in the public interest, the corporate lobby is using TISA to bypass elected officials in order to apply a set of across-the-board rules that would never be approved on their own by democratic governments.”

   Broad impact: “The documents show that the TISA will impact even non-participating countries,” wrote OWINFS. “The TISA is exposed as a developed countries’ corporate wish lists for services which seeks to bypass resistance from the global South to this agenda inside the WTO, and to secure and agreement on servcies without confronting the continued inequities on agriculture, intellectual property, cotton subsidies, and many other issues.”

Despite assurances that Fast Track would force the president to reveal the contents of these agreements, it also removes congresses ability to amend, debate or filibuster. Right now, only congress members can view these complex documents. They are not allowed to take notes, ask questions or even discuss the contents amongst themselves, while big corporations are free to read and discuss it. This is not how transparency works, Barrack.

Meanwhile, to promote transparency, Wikileaks is offers $100,000 to anyone who will reveal the missing chapters from the TPP. Only three of the of the 26 chapters have been uncovered so far. It is imperative that Americans and the  world know what our governments are doing in our names.

The Fast Track vote is coming up this week. Help Stop Fast Track

TBC: Morning Musing 6.9.15

Hello! I have 3 articles for your perusal this Tuesday morning!

First up, California’s got some trouble:

California is sinking, and it’s getting worse

Last summer, scientists recorded the worst sinking in at least 50 years. This summer, all-time records are expected across the state as thousands of miles of land in the Central Valley and elsewhere sink.

But the extent of the problem and how much it will cost taxpayers to fix are part of the mystery of the state’s unfolding drought. No agency is tracking the sinking statewide, little public money has been put toward studying it and California allows agriculture businesses to keep crucial parts of their operations secret.

The cause is known: People are pulling unsustainable amounts of water out of underground aquifers, primarily for food production. With the water sucked out to irrigate crops, a practice that has accelerated during the drought, tens of thousands of square miles are deflating like a leaky air mattress, inch by inch.


On This Day In History June 9

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.

June 9 is the 160th day of the year (161st in leap years) in the Gregorian calendar. There are 205 days remaining until the end of the year.

On this day in 1973, Secretariat wins Triple Crown

With a spectacular victory at the Belmont Stakes, Secretariat becomes the first horse since Citation in 1948 to win America’s coveted Triple Crown–the Kentucky Derby, the Preakness, and the Belmont Stakes. In one of the finest performances in racing history, Secretariat, ridden by Ron Turcotte, completed the 1.5-mile race in 2 minutes and 24 seconds, a dirt-track record for that distance.

With easy victories in his first two starts of 1973, Secretariat seemed on his way to the Triple Crown. Just two weeks before the Kentucky Derby, however, he stumbled at the Wood Memorial Stakes at Aqueduct, coming in third behind Angle Light and Sham. On May 5, he met Sham and Angle Light again at the Churchill Downs track in Louisville for the Kentucky Derby. Secretariat, a 3-to-2 favorite, broke from near the back of the pack to win the 2 1/4-mile race in a record 1 minute and 59 seconds. He was the first to run the Derby in less than two minutes and his record still stands. Two weeks later, at Pimlico Race Course in Baltimore, Maryland, Secretariat won the second event of the Triple Crown: the Preakness Stakes. The official clock malfunctioned, but hand-recorded timers had him running the 1 1/16-mile race in record time.

On June 9, 1973, almost 100,000 people came to Belmont Park near New York City to see if “Big Red” would become the first horse in 25 years to win the Triple Crown. Secretariat gave the finest performance of his career in the Belmont Stakes, completing the 1.5-mile race in a record 2 minutes and 24 seconds, knocking nearly three seconds off the track record set by Gallant Man in 1957. He also won by a record 31 lengths. Ron Turcotte, who jockeyed Secretariat in all but three of his races, claimed that at Belmont he lost control of Secretariat and that the horse sprinted into history on his own accord.

The Daily/Nightly Show (Raibeart Bruis)

Security Theater

Tonightly the topic is Theodore Giselle’s 1929 racist cartoon.  The panel is Seaton Smith, Frank Luntz, and Bonnie McFarlane.


John Hodgeman

This week’s guests-

Nicola Sturgeon is the Scots First Minister and the leader of the Scottish National Party.  Though they lost in Independence referendum in 2014, the SNP under Ms. Sturgeon’s direction scored a landmark 56 of 59 total seats in the English Parliament in 2015.  Ms. Sturgeon has announced she’ll direct her Party to hamper further Conservative attacks on Social Safety Net program and to hold David Cameron’s feet to the fire to deliver on his promises of Scots autonomy.

In an interesting controversy, it was alleged during the 2015 campaign in a leaked memo that Ms. Sturgeon had, in conversation with the French Ambassador, said that she preferred a Cameron victory.  This memo was proven to be entirely fabricated by Scottish Secretary Alistair Carmichael who was forced to resign.

Ms. Sturgeon is a member of the Scots Parliament only and is not seated in The House of Commons.

The real news below.