Tag: Joseph Stiglitz

The Real SOTU: The White House Subverting the Rule of Law

Subverting the rule of law? How dare I? Well the 4th amendment, due process, kill lists, and the NDAA also speak to my title. Yes, they speak to it despite those that decided politicians were more important than the principles they pretended to have in 2004 now outed as hypocrites mostly. However, that being said, I’m talking about subverting the rule of law in a different way but equally as damaging on the economic front.

After all, it was at the SOTU merely just a year ago that President Obama assured us that something was going to be done about the Wall St. perpetrators of our mortgage and foreclosure crisis. This was a crisis in which they defrauded consumers with sub-prime NINJA loans pumping up the housing bubble and then dumping the private debt overhang onto the economy destroying over 10 trillion in housing wealth. This left consumers with massive loads of private debt and everyone else jobless like this recovery.

This White House’s DOJ has made a complete mockery of the concept of Justice in and of itself. That illusion of Justice is perpetuated to this day and normal people are devastated because of it. Let President Obama know you are not amused. I have.

Reflections on 9/11

Naom Chomsky: Was There an Alternative? Looking Back on 9/11 a Decade Later

We are approaching the 10th anniversary of the horrendous atrocities of September 11, 2001, which, it is commonly held, changed the world. On May 1st, the presumed mastermind of the crime, Osama bin Laden, was assassinated in Pakistan by a team of elite US commandos, Navy SEALs, after he was captured, unarmed and undefended, in Operation Geronimo.

A number of analysts have observed that although bin Laden was finally killed, he won some major successes in his war against the U.S. “He repeatedly asserted that the only way to drive the U.S. from the Muslim world and defeat its satraps was by drawing Americans into a series of small but expensive wars that would ultimately bankrupt them,” Eric Margolis writes. “‘Bleeding the U.S.,’ in his words.” The United States, first under George W. Bush and then Barack Obama, rushed right into bin Laden’s trap… Grotesquely overblown military outlays and debt addiction… may be the most pernicious legacy of the man who thought he could defeat the United States” — particularly when the debt is being cynically exploited by the far right, with the collusion of the Democrat establishment, to undermine what remains of social programs, public education, unions, and, in general, remaining barriers to corporate tyranny.

That Washington was bent on fulfilling bin Laden’s fervent wishes was evident at once. As discussed in my book 9-11, written shortly after those attacks occurred, anyone with knowledge of the region could recognize “that a massive assault on a Muslim population would be the answer to the prayers of bin Laden and his associates, and would lead the U.S. and its allies into a ‘diabolical trap,’ as the French foreign minister put it.”

Glenn Greenwald: Endless War and the Culture of Unrestrained Power

The Washington Post woke up a few days ago and realized that despite everything that has happened since 9/11 — no successful Terrorist attacks on the Homeland in 10 years, a country mired in debt and imposing “austerity” on ordinary Americans, and the election of a wonderfully sophisticated, urbane, progressive multinationalist from the storied anti-war Democratic Party — we are still smack in the middle of “the American era of endless war” with no end in sight.  Citing the Pentagon’s most recent assessment of global threats, the Post notes that in contrast to prior decades — when “the military and the American public viewed war as an aberration and peace as the norm” (a dubious perception) — it is now clear, pursuant to official doctrine, that “America’s wars are unending and any talk of peace is quixotic or naive,” all as part of “America’s embrace of endless war in the 10 years since Sept. 11, 2001.”


Those who wield true political authority as part of an empire are vested with immense power over other people, but those who exercise that authority as part of wars are more powerful still.  That kind of power not only attracts warped authoritarians and sociopaths like moths to light, but it also converts — degrades — otherwise normal people who come to possess it.  That’s not a new development, but rather as old as political power itself.  Those bolded quotes are a pure expression of a demented, amoral God complex.  That’s the mentality that produces Endless War, and Endless War, in turn, breeds that mentality.

This is why there is nothing more dangerous — nothing — than allowing this type of power to be exercised without accountability: no oversight, no transparency, no consequences for serious wrongdoing: exactly the state of affairs that prevails in the United States.  It’s also why there are few things more deeply irresponsible, vapid and destructive than demanding that citizens, activists, and journalists retreat into Permanent Election Mode: transform themselves into partisan cheerleaders who refrain from aggressively criticizing the party that is slightly less awful out of fear that the other party might win an election 14 months away, even when their own party is the one in power.  Renouncing the duty of holding accountable political leaders who exercise vast power makes one directly responsible for the abuses they commit.  To see the results of that mindset, re-read that paragraph from (Amy) Davidson about what the U.S. is doing not in 2004, but now more than ever, in the name of Endless War.

Joseph E. Stiglitz: The Price of 9/11

NEW YORK – The September 11, 2001, terror attacks by Al Qaeda were meant to harm the United States, and they did, but in ways that Osama bin Laden probably never imagined. President George W. Bush’s response to the attacks compromised America’s basic principles, undermined its economy, and weakened its security.


ndeed, when Linda Bilmes and I calculated America’s war costs three years ago, the conservative tally was $3-5 trillion. Since then, the costs have mounted further. With almost 50% of returning troops eligible to receive some level of disability payment, and more than 600,000 treated so far in veterans’ medical facilities, we now estimate that future disability payments and health-care costs will total $600-900 billion. But the social costs, reflected in veteran suicides (which have topped 18 per day in recent years) and family breakups, are incalculable.


Ironically, the wars have undermined America’s (and the world’s) security, again in ways that Bin Laden could not have imagined. An unpopular war would have made military recruitment difficult in any circumstances. But, as Bush tried to deceive America about the wars’ costs, he underfunded the troops, refusing even basic expenditures – say, for armored and mine-resistant vehicles needed to protect American lives, or for adequate health care for returning veterans. A US court recently ruled that veterans’ rights have been violated. (Remarkably, the Obama administration claims that veterans’ right to appeal to the courts should be restricted!)

Military overreach has predictably led to nervousness about using military power, and others’ knowledge of this threatens to weaken America’s security as well. But America’s real strength, more than its military and economic power, is its “soft power,” its moral authority. And this, too, was weakened: as the US violated basic human rights like habeas corpus and the right not to be tortured, its longstanding commitment to international law was called into question.

The Real Cost of the War on Terror

Osama bin Laden may be dead but he’s still winning the economic war he started.

Osama bin Laden didn’t win, but he was ‘enormously successful’

By Ezra Klein, Published: May 2

Did Osama bin Laden win? No. Did he succeed? Well, America is still standing, and he isn’t. So why, when I called Daveed Gartenstein-Ross, a counterterrorism expert who specializes in al-Qaeda, did he tell me that “bin Laden has been enormously successful”? There’s no caliphate. There’s no sweeping sharia law. Didn’t we win this one in a clean knockout?

Apparently not. Bin Laden, according to Gartenstein-Ross, had a strategy that we never bothered to understand, and thus that we never bothered to defend against. What he really wanted to do – and, more to the point, what he thought he could do – was bankrupt the United States of America. After all, he’d done the bankrupt-a-superpower thing before. And though it didn’t quite work out this time, it worked a lot better than most of us, in this exultant moment, are willing to admit.


Nobel laureate Joseph Stiglitz estimates that the price tag on the Iraq War alone will surpass $3 trillion. Afghanistan likely amounts to another trillion or two. Add in the build-up in homeland security spending since 9/11 and you’re looking at another trillion. And don’t forget the indirect costs of all this turmoil: The Federal Reserve, worried about a fear-induced recession, slashed interest rates after the attack on the World Trade Center, and then kept them low to combat skyrocketing oil prices, a byproduct of the war in Iraq. That decade of loose monetary policy may well have contributed to the credit bubble that crashed the economy in 2007 and 2008.

Then there’s the post-9/11 slowdown in the economy, the time wasted in airports, the foregone returns on investments we didn’t make, the rise in oil prices as a result of the Iraq War, the cost of rebuilding Ground Zero, health care for the first responders and much, much more.

Stiglitz’s view of the economy and how to fix it

By John Hanrahan

Nobel laureate economist Joseph Stiglitz wants Americans not to be diverted by much of the rhetoric in the political debate over deficits and the calls for harsh austerity from Republican members of Congress and some GOP governors.

In contrast to the austerity hawks’ proposals, Columbia University professor Stiglitz says, “There are principled ways of cutting the deficit” and reducing the nation’s overall debt while at the same time “putting Americans back to work,” making life better for the millions of Americans in precarious economic circumstances, and halting growing economic inequality where one percent of the population controls 40 percent of the wealth and takes one-fourth of the nation’s income every year.


“The deficit didn’t cause the downturn,” he said, “the downturn caused the deficit.”


A few years ago, Stiglitz and Linda Bilmes, a public policy professor at the Harvard Kennedy School, wrote a book, “The Three Trillion Dollar War,” the title a reference to what they estimated would be the ultimate cost of the Iraq and Afghanistan wars. Since then, he said, they have come to realize “we were much too conservative” in estimating the costs.

  • Making sure all corporations pay their share of taxes, and requiring the nation’s wealthiest 1 percent of individuals to pay more in income taxes. Even after ending the Bush tax cuts for the wealthiest Americans, Stiglitz said, those highest-income taxpayers “would still be ahead of where they were a decade ago.”
  • Imposing “moderate increases” in capital gains and estate taxes and establishing a “small financial transactions tax,” all of which could raise substantial revenue, he said.
  • Stopping “government giveaways of natural resources” – oil, gas, minerals, forests – through well-structured auctions that would bring in “serious revenue.”
  • Curtailing corporate welfare, “which makes our economy more inefficient and increases unemployment.”
  • Increasing enforcement of federal antitrust laws. Regarding the Bowles-Simpson Commission deficit reduction recommendations, Stiglitz noted that panel’s proposal to do away with the homeowners’ mortgage deduction. He said, “Eventually, we must deal with the mortgage deduction, but not now.” Eliminating the mortgage deduction in this troubled economy “would amount to an increased tax,” hitting hardest on the already hard-hit middle-class “and would make the housing market even worse,” he said.

Even before the economic crisis hit in 2007, Stiglitz said, the vast majority of Americans “year after year were getting poorer.” Household income today, on average, is lower than it was in 1997, at the same time income and wealth inequality have became even more pronounced in the United States. Yet, he said, we “told people to pretend their income was going up and to consume more.” And people did that, going into debt while at the same time believing they were getting wealthier because of the housing bubble.

In those days before the housing bubble collapsed, “We were on artificial respiration and we didn’t even know it,” Stiglitz said.

Stiglitz: The Cost Of War and Redistribution of Wealth

Nobel Prize laureate Joseph Stiglitz has consistently pointed out that the US is on the wrong track for economic recovery and that the continued support for the money pit of Iraq and the shifting the countries wealth to the 2% elite will be the downfall of economics growth, He recently wrote an excellent article in Vanity Fair, Of the 1%, by the 1%, for the 1%, pointing out that even the wealthy will come to regret this path.

t’s no use pretending that what has obviously happened has not in fact happened. The upper 1 percent of Americans are now taking in nearly a quarter of the nation’s income every year. In terms of wealth rather than income, the top 1 percent control 40 percent. Their lot in life has improved considerably. Twenty-five years ago, the corresponding figures were 12 percent and 33 percent. One response might be to celebrate the ingenuity and drive that brought good fortune to these people, and to contend that a rising tide lifts all boats. That response would be misguided. While the top 1 percent have seen their incomes rise 18 percent over the past decade, those in the middle have actually seen their incomes fall. For men with only high-school degrees, the decline has been precipitous-12 percent in the last quarter-century alone. All the growth in recent decades-and more-has gone to those at the top. In terms of income equality, America lags behind any country in the old, ossified Europe that President George W. Bush used to deride. Among our closest counterparts are Russia with its oligarchs and Iran. While many of the old centers of inequality in Latin America, such as Brazil, have been striving in recent years, rather successfully, to improve the plight of the poor and reduce gaps in income, America has allowed inequality to grow.

(emphasis mine)

This is well worth the time to read the entire piece and save it as a reference as this country sinks further into the morass and becomes a “Banana Republic”as the Tea Party Republicans try to drag this country back to the 19th century by repealing laws that protect children and workers.

Stiglitz also appeared on Democracy, Now! with Amy Goodman and Juan Gonzalez to discuss his article and the current US “budget crisis” that has been fabricated by the right wing, Obama and the ever beholding MSM:

This week Republicans unveiled a budget proposal for 2012 that cuts more than $5.8 trillion in government spending over the next decade. The plan calls for sweeping changes to Medicaid and Medicare, while reducing the top corporate and individual tax rates to 25 percent. We speak to Nobel Prize-winning economist Joseph Stiglitz, who addresses the growing class divide taking place in the United States and inequality in a new Vanity Fair article titled “Of the 1, by the 1, for the 1%.” Stiglitz is a professor at Columbia University and author of numerous books, most recently Freefall: America, Free Markets, and the Sinking of the World Economy. “It’s not just that the people at the top are getting richer,” Stiglitz says. “Actually, they’re gaining, and everybody else is decreasing… And right now, we are worse than old Europe.” includes rush transcript

Nobel Economist Joseph Stiglitz: Assault on Social Spending, Pro-Rich Tax Cuts Turning U.S. into Nation “Of the 1 Percent, by the 1 Percent, for the 1 Percent”

Stiglitz: Economics Doctor’s Rx for the Problems

Paul Krugman linked to this chart from a paper by Mary Daly of the San Francisco Fed with the comparison of the Japanese economy to the current US economic morass.


Joseph Stiglitz, Nobel Prize winner, doctor of economics and professor of economics at Columbia University, appeared today on the Dylan Ratigan Show and offered his advice for radical surgery to get the money and the jobs flowing again.


“What is the risk of not dealing with the vicious cycle that is becoming joblessness in America, which leads to foreclosure in America, which leads to bank dysfunctionality, which leads to less investing and that vicious cycle that clearly has tremendous peril? What is that peril?”


“Well, I learned years ago that if we didn’t do it, we would be exactly where we are today and if we don’t do it now, we are likely to be entering into a Japanese style malaise, low growth, high unemployment, literally for years to come that should be unacceptable.”

See chart above and listen to Stiglitz offer his “radical surgical” solution.

A Battle of Wits with the Unarmed

This is a battle of wits with the unarmed. Beautiful. President Obama put Stiglitz on speed dial if he doesn’t want to be on your Council.

Unfair fight: Joe Stiglitz versus Dick Armey

The Nobel prize winner and the former GOP House majority leader tangle over Keynesian economics

In the left corner is Joseph Stiglitz, former chief economist of the World Bank, winner of the John Bates Clark award for best economist under the age of 40 and the Nobel prize for economics, boasting a PhD from MIT and teaching stints at Yale, Stanford, Oxford, Princeton and Columbia. On the right is Dick Armey, former Republican majority leader in the House of Representatives, onetime economics professor at North Texas State University and House majority leader for the first two years of George Bush’s first term, during which the “first round of the Bush tax cuts were passed, without any corresponding cuts in spending, with the result that the Clinton-era budget surplus was transformed almost immediately into annual deficits“.

The topic, the current economy and solutions for recovery.

The punch line from Stiglitz

Over the business cycle, it does make sense for us to have a balanced budget or certainly a much more balanced budget than we have had. The fact that we were running large deficits in the period of our boom was unconscionable.

Stiglitz: Dear Tea Bag Party, Government is Absolutely Essential

President Obama, this is the man who should head your Economic Council along with Robert Reich, Paul Krugman and Nouriel Roubini. Watch the entire video, it is an education in the current economic situation and how we got here.

Complete video at: Joseph Stiglitz: Freefall Commonwealth Club

What would Nobel Prize-winning economist Joseph Stiglitz say at a Tea Party convention? Stiglitz says he would defend the role of government in economic affairs, positing that the bank bailout saved the country from depression.

Joseph Stiglitz, winner of the 2001 Nobel Prize Winner for Economics and author of Freefall sits down with Andrew Leonard, Senior Technology and Business Writer for Salon.

Stiglitz argues that America exported bad economics, bad policies and bad behavior to the rest of the world. Stiglitz outlines a way forward building on ideas that he has championed his entire career: restoring the balance between markets and government; addressing the inequalities of the global financial system; and demanding more good ideas (and less ideology) from economists. – Commonwealth Club of California

Joseph Stiglitz was chief economist at the World Bank until January 2000. Before that he was the chairman of President Clinton’s Council of Economic Advisers. He was awarded the Nobel Prize in economics in 2001. He is currently a finance and economics professor at Columbia University. He is most recently the author of Freefall: America, Free Markets, and the Sinking of the World Economy.