Tag: ek Politics

Keith’s new show, Countdown, appears June 20th on Al Gore’s Current TV.  This Special Comment is from Friends of Keith.

A year on, flash crash didn’t prove transformative

By Jonathan Spicer, Reuters

Thu May 5, 2011 8:55am EDT

In the hours and days after last year’s “flash crash,” it seemed like Wall Street’s high-tech marketplace was in for big changes.

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Yet a year later, little has changed — suggesting that while the flash crash was historic, it was not transformative.

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With Europe’s debt crisis keeping markets on edge on May 6, 2010, a big futures sale sparked a cascade of selling in the stock market. The high-frequency algorithmic traders that now supply much of the market’s orders started bailing out, leaving nothing to stop the stampede to sell at any cost.

The Dow Jones industrial average plunged nearly 700 points in minutes that afternoon, eliminating $1 trillion in paper value before rebounding nearly as quickly. Blue-chip stocks hit record lows while others such as Accenture Plc traded for a penny, prompting thousands of trade breaks and wrecking havoc on investments.

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The U.S. Securities and Exchange Commission has so far made only one structural adjustment to markets: trading pauses known as circuit breakers. The regulator also made some noncontroversial nips and tucks around the edges and is mulling further changes, but for now at least, an overhaul is nowhere on the horizon.

“Not enough has been done,” said Andrew Brooks, head of U.S. equity trading at T Rowe Price, a big Baltimore-based asset manager.

“Do we know who trades all the large stuff? Do we know the nature of the counterparties in the marketplace today? The answer is no, and it’s crazy.”

So much for free, efficient, and transparent markets.

The solution is a transaction tax.  Not only would it force high churn traders to reconsider their gambling bets “investment” decisions, but it would also solve our revenue (not deficit) problem at a stroke.

What we have to do structurally is make it impossible (or prohibitively expensive) to gamble ‘on the house’ by using leverage as a money multiplier unless you are prepared to pay off your private debts when you lose.

I have no sympathy at all for those who sold Accenture at a penny.  You were fucking stupid to let a computer make your decisions for you.  Master of the Universe my ass, you’re a con man with a gambling addiction, a moron, and you deserve to be kicked to the gutter penniless and homeless like your Randian philosophy demands.

Budget debate’s center tilts to left

Robert Reich, San Francisco Chronicle

Sunday, May 1, 2011

In my view, even the president doesn’t go nearly far enough in the direction most Americans would approve. His plan doesn’t really increase taxes on the rich. It merely ends the Bush tax windfalls for the wealthy – which were originally designed to be ended in 2010 in any event – and closes a few loopholes.

But if we’re in a budget crisis, why shouldn’t we go back to the tax rates we had 30 years ago, which required the rich to pay much higher shares of their incomes? One of the great scandals of our age is how concentrated income and wealth have become. The top 1 percent now gets twice the share of national income it took home 30 years ago.

If the super-rich paid taxes at the same rates they did three decades ago, they’d contribute $350 billion more per year than they do now – amounting to trillions more over the next decade. That’s enough to ensure that every young American is healthy and well educated and that the nation’s infrastructure is up to world-class standards.

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If Americans understood how much they’re paying for defense and how little they’re getting, they’d demand a defense budget at least 25 percent smaller than it is today.

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I’d wager that if Americans also knew that the Ryan plan would channel hundreds of billions of their Medicare dollars into the pockets of private for-profit heath insurers, more would be against it.

If people knew that two-thirds of Ryan’s budget cuts would come from programs serving lower- and moderate-income Americans while more than 70 percent of the savings would fund tax cuts for the rich, even more would oppose it.

And if they knew that combining the tax cuts for the rich with the budget-cuts plan would produce almost no deficit reduction at all, just about everyone would be against it. The plan is little more than a giant transfer from the less advantaged to the super advantaged.

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Finally, the president’s proposed budget – which, again, is considered the extreme liberal end of the field – doesn’t begin to remedy the scandal of the nation’s schools in poor and middle-class communities. Most teachers in these schools are paid less than $50,000 a year, and classrooms are crammed.

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According to the most recent Washington Post-ABC News poll, 78 percent of Americans oppose cutting spending on Medicare as a way to reduce the budget deficit. Meanwhile, raising taxes on the wealthy is supported by 72 percent. That includes 68 percent of independents. Even a majority of registered Republicans – 54 percent – say taxes should be raised on the rich. A majority of Republicans!

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The Ryan Republican plan shouldn’t be considered one side of a great debate. It shouldn’t be considered at all. Americans of all political persuasions – including a large percentage of registered Republicans – don’t want it.

Costly Afghanistan Road Project Is Marred by Unsavory Alliances

By ALISSA J. RUBIN and JAMES RISEN, The New York Times

Published: May 1, 2011

The money paid to Mr. Arafat bought neither security nor the highway that American officials have long envisioned as a vital route to tie remote border areas to the Afghan government. Instead, it added to the staggering cost of the road, known as the Gardez-Khost Highway, one of the most expensive and troubled transportation projects in Afghanistan. The 64-mile highway, which has yet to be completed, has cost about $121 million so far, with the final price tag expected to reach $176 million – or about $2.8 million a mile – according to American officials. Security alone has cost $43.5 million so far, U.S.A.I.D. officials said.

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Despite the expense, a stretch of the highway completed just six months ago is already falling apart and remains treacherous. The unfinished portion runs through Taliban territory, raising questions about how it can be completed. Cost overruns are already more than 100 percent, all for a road where it was never certain that local Afghans wanted it as badly as the American officials who planned it.

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Within weeks of starting work, a construction camp was hit with rocket-propelled grenades, said Steve Yahn, the former chief engineer for the Gardez-Khost Highway project. Afterward, the provincial governor and the police chief told the Americans that if they had hired the right people for security, the attack would never have happened. “We got the message,” Mr. Yahn said.

That is when Mr. Arafat and 200 of his men were brought in to protect work crews. He was recommended by tribal elders from the Zadran tribe, said Paktia’s governor, Juma Khan Hamdard.

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“On paper, the G.K. road was paying an enormous security detail of local-hire Afghans,” said one United States official. The highway contractors “would make a big deal out of their camps’ getting hit from time to time, and some of their guys would get shot in night attacks, but every instance I ever heard about coincided with payment negotiations with the Afghan security detail, of whom Arafat was the chief point of contact,” the official said.

It is impossible to determine how many of the attacks on the highway may have been staged by Mr. Arafat or his men. Despite all the money spent on security, however, there have been 364 attacks on the Gardez-Khost Highway, including 108 roadside bombs, resulting in the deaths of 19 people, almost all of them local Afghan workers.

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“Since I have left the security of the road, it’s chaos there,” Mr. Arafat said. In fact, security officials have not seen any significant incidents since Mr. Arafat’s departure, they said.

A military officer who asked not to be identified said that contractors working in remote stretches of Afghanistan constantly faced such dilemmas. Do you keep paying off insurgents, or others, to keep the peace, even though they could use the money to buy weapons and sustain the insurgency?

“It’s a tradeoff,” said the officer. “It’s Afghanistan; there is never a good answer.”

Canada kinda kicks off their election today eh?, and I’m hesitant to speak about it since I don’t know much aboot Canada except they have great beer and it’s called back bacon (and it’s not ham, eh?).

Scott Harper is reliably reported to be a right wing asshole of the Reagan variety (it is Canada, eh?), but his Conservative Party is likely to be the leading party at the polls (Palimentary districts are called ‘Ridings‘ and there are 308 of them).

Victory in each seat is a first past the post plurality and for years and years the Liberal Party (think of them like Third Way Democrats) have been the opposition party.  This year that will change.

The NDP is pretty sure to eclispe the Liberals by dozens of seats

There’s a slim possibility the New Democratic Party (Social Democrats) and the Bloc Quebecois (those cheese eating French secessionists) will be able to put together a majority.  Far more likely is that the so-called Liberals form a majority with the Conservatives (who’d a thunk?) BUT it’s also probably the end of the Liberal Party as a force in Canadian politics.

It’s not just the UK Liberal Democrats austerity thing that kills them, it’s because there are fiddly little advantages to being the #2 party like appearing second on ballots which will advantage the NDP the next time around whether the Liberals sell out or not.

Some links-

• The Canadian Election, by Ian Welsh, 2011 May 2
• Canadian 2011 federal election, April 30th update, By: trthomas, MyFDL, Saturday April 30, 2011 5:54 pm
• Canadian Election Monday – voting is IMPERATIVE! (Also: Tory majority IMPOSSIBLE! YAY!), LostClown, Corrente, Fri, 04/29/2011 – 8:26pm
• Canada’s Left Wing New Democratic Party Surges in Polls; Is Electoral Reform Near?, By: Jon Walker, Firedog Lake, Wednesday April 27, 2011 4:32 pm
• On the NDP Surge in Canada, by Ian Welsh, 2011 April 26

308 the Canadian 538, eh?

There’s an apocryphal story about how someone asked Mao whether the invention of fire had been a good or bad thing for the Chinese people.

His answer?  “Too soon to tell.”

In like manner I respond to the news of Bin Laden’s death.

Is he dead yet?  I’ve read some unsupported reports that he was buried at sea which, if true, will only lead to Hitler in Argentina exile theories and Elvis sightings.  How involved was Pakistan in protecting him if he was finally found in a villa 500 yards from the 15th tee at the officers’ golf course on the main military base in Islamabad?  Is it just co-incidence that this happened on the 8th anniversary of ‘Mission Accomplished’ and trashed the last 10 minutes of Celebrity Apprentice?

Too soon to tell.

Details that answer those questions may emerge in time, but to me the far more important question is- will the U.S. accept yes for an answer?

For the last 10 years we’ve gutted our Constitution, imprisoned innocents indefinitely without due process, tortured, murdered, and started wars of aggression all ‘in pursuit’ of Boogey Man Bin Ladin.

Now that he’s ‘dead’ will we stop?

Too soon to tell.

Wal-Mart: Our shoppers are ‘running out of money’

By Parija Kavilanz, senior writer, CNNMoney

April 28, 2011: 2:41 PM ET

“We’re seeing core consumers under a lot of pressure,” (Wal-Mart CEO) Duke said at an event in New York. “There’s no doubt that rising fuel prices are having an impact.”

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Now, with its strategy of low prices all the time back in place, Duke said making Wal-Mart a “one-stop shopping stop” is a critical response to dealing with the rising price of fuel.

Americans don’t have the luxury of driving all over town to do their shopping.

Wal-Mart brings guns back

By Parija Kavilanz, senior writer, CNNMoney

April 28, 2011: 1:24 PM ET

NEW YORK (CNNMoney) — Wal-Mart said Thursday that it is bringing guns back to many of its U.S. stores in an effort to lift slumping sales.

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Wal-Mart currently sells rifles, shotguns and ammunition in about 1,300 stores in the United States.

Those firearms will now be available at about half of Wal-Mart’s 4,000 stores.

Tip of the hat to Chris in Paris who opines-

Is it asking for too much to have our political leadership implement policies that help the middle class as opposed to the continuing strategy that helps Wall Street?

Regular Features-

• Late Night Karaoke by mishima
• Muse in the Morning by Robyn
• Six In The Morning by mishima
• Cartnoon by ek hornbeck

Featured Essays for April 28, 2011-

• "Gray Eagle Draws First Blood" in Afghanistan by Jacob Freeze
• Three Cups of a Flawed Hero: The Limits of Greg Mortenson’s Model of Change by PaulLoeb
• Where is the outrage? It’s Here by TheMomCat
• Turning Japanese by ek hornbeck
• Cardinal George fires Fr. Pfleger – by Xanthe
• What Happens When You Tickle a Baby Penguin? by Jacob Freeze

DocuDharma

Culture of Complicity Tied to Stricken Nuclear Plant

By NORIMITSU ONISHI and KEN BELSON, The New York Times

Published: April 26, 2011

Despite a new law shielding whistle-blowers, the regulator, the Nuclear and Industrial Safety Agency, divulged Mr. Sugaoka’s identity to Tokyo Electric, effectively blackballing him from the industry. Instead of immediately deploying its own investigators to Daiichi, the agency instructed the company to inspect its own reactors. Regulators allowed the company to keep operating its reactors for the next two years even though, an investigation ultimately revealed, its executives had actually hidden other, far more serious problems, including cracks in the shrouds that cover reactor cores.

Investigators may take months or years to decide to what extent safety problems or weak regulation contributed to the disaster at Daiichi, the worst of its kind since Chernobyl. But as troubles at the plant and fears over radiation continue to rattle the nation, the Japanese are increasingly raising the possibility that a culture of complicity made the plant especially vulnerable to the natural disaster that struck the country on March 11.

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A 10-year extension for the oldest of Daiichi’s reactors suggests that the regulatory system was allowed to remain lax by politicians, bureaucrats and industry executives single-mindedly focused on expanding nuclear power. Regulators approved the extension beyond the reactor’s 40-year statutory limit just weeks before the tsunami despite warnings about its safety and subsequent admissions by Tokyo Electric, often called Tepco, that it had failed to carry out proper inspections of critical equipment.

The mild punishment meted out for past safety infractions has reinforced the belief that nuclear power’s main players are more interested in protecting their interests than increasing safety. In 2002, after Tepco’s cover-ups finally became public, its chairman and president resigned, only to be given advisory posts at the company. Other executives were demoted, but later took jobs at companies that do business with Tepco. Still others received tiny pay cuts for their role in the cover-up. And after a temporary shutdown and repairs at Daiichi, Tepco resumed operating the plant.

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In Japan, the web of connections between the nuclear industry and government officials is now popularly referred to as the “nuclear power village.” The expression connotes the nontransparent, collusive interests that underlie the establishment’s push to increase nuclear power despite the discovery of active fault lines under plants, new projections about the size of tsunamis and a long history of cover-ups of safety problems.

Sound like anyplace we know?

I’m not even sure I’ll watch it because I’m sure I won’t understand most of it.  While fluent in C and Basic I don’t understand Fedese (if there is indeed any understanding of it and it’s not just insincere shamen babbling nonsense in tongues to confuse and impress the ignorant).

Clearly Samuelson economics works and in the words of Krugman (who only has a Nobel Prize in Economics)-

(R)ight now, we’re living in a world in which basic economics points to conclusions utterly at odds with what Very Serious People are supposed to believe, in which radical outsiders base their views on standard economics while orthodox types turn to heterodox, highly dubious speculations.

Econ 101, buttressed if you like by fancier New Keynesian models, says that contractionary fiscal policy is, well, contractionary. Yet much of the world of movers and shakers bought into the exotic notion that expectational effects – the confidence fairy – would make contractionary policy expansionary. And they clung to this belief even as the supposed historical evidence in favor of expansionary austerity was thoroughly debunked.

The blogosphere is full of intellegent questions that will never be asked but my favorite so far was propounded by Sen. Bernie Sanders (via dday).

Sanders’ report found-

(N)umerous instances during the financial crisis of 2008 and 2009 when banks took near zero-interest funds from the Federal Reserve and then loaned money back to the federal government on sweetheart terms for the banks. The banks pocketed interest on government securities that paid rates up to 12 times greater than the Fed’s rock bottom interest charges. … “This report confirms that ultra-low interest loans provided by the Federal Reserve during the financial crisis turned out to be direct corporate welfare to big banks,” Sanders said. “Instead of using the Fed loans to reinvest in the economy, some of the largest financial institutions in this country appear to have lent this money back to the federal government at a higher rate of interest by purchasing U.S. government securities.”

Chairman Bernanke, in light of this report, do you consider it good policy for the US to hand over money to the nation’s largest banks directly through this kind of scheme? Would it make just as much sense, if you find it good for the economy, to make the same investment strategy available to small businesses, states or the US government itself to deal with their budget problems? After all, it would take a true idiot not to make fantastic amounts of money if they can borrow at zero and loan money back at high rates. Why should individuals be deprived of this money-conjuring strategy?

Furthermore, shouldn’t those profits, rather than boosting the balance sheets of the large banks, have been put back into the economy? Shouldn’t that have been a condition of the direct subsidy?

I dare someone to ask that.

Anyway, your questions and reactions below and hopefully by tomorrow we’ll have some idea of what Bernanke actually said.