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Health Care & Environment

07.21 Greta Thunberg: ‘They see us as a threat because we’re having an impact’ [We love a sane smarty-pants! Trump, you won't understand any of this, so just go off and tweet or chant, or whatever...]

07.20 Until Emissions Drop, Nothing Has Been Accomplished: The Climate Resistance Handbook Is Here. [Trump can't be bothered as the world turns into a large cinder. His laser focus is on personal greed.]

07.20 Cargo ships are emitting boatloads of carbon, and nobody wants to take the blame [1:19 video; Governments must commission to fight deadly shipping emissions, previously omitted in climate summit agreements....]

07.20 Babies Born Near Oil and Gas Wells Are Up to 70% More Likely to Have Congenital Heart Defects, New Study Shows

07.20 Giving 'Upper Hand to Corporate Polluters,' EPA Drops Surprise Inspections

07.20 With Petition to Congress, 100,000+ People Demand Green New Deal 'That Fixes Our Food System' [Realtime proactive response to reality—now and threatening—doesn't get attention in this greed focused administration]

07.19 Trump administration won't ban pesticide tied to childhood brain damage [There is no truth to the persistent rumor that chlorpyrifos pesticide was heavily used at Trump's childhood home in Queens]

07.19 'Unprecedented' Decline of Plants and Animals as Global 'Red List' Reveals Nearly One-Third of Assessed Species Under Threat

07.17 ‘Off-the-charts’ heat to affect millions in U.S. in coming decades

07.17 Planned Parenthood president Leana Wen forced out by board [Given that states have lost abortion rights on political grounds recently, Wen's philosophical approach to protect abortion rights based on ‘health care’ was smarter – therefore it was that smarter strategy that was killed at the secret meeting.]

07.17 Billions of air pollution particles found in hearts of city dwellers

07.17 What is happening in America's Cancertown is tragic, immoral and evil [Niggardly white government policies could change to produce better students, better jobs and net revenue instead of costs. But it seems they enjoy more cruelty—like Trump.]

07.16 US aid cuts to UN agency will hurt vulnerable women and children, critics say

07.16 Trump abortion restrictions in effect for taxpayer-funded clinics

07.15 The response to DRC’s Ebola crisis isn’t working. Here’s what we need to do

07.15 Extinction Rebellion protests block traffic in five UK cities [Non-corporate human animals make their annoying bleating sounds...]

07.14 A Glacier the Size of Florida Is Becoming Unstable. It Has Dire Implications for Global Sea Levels [The willfully ignorant needn't read more, Trump]

News Media Matters

07.19 Fox News’s star names excuse the inexcusable after Trump's latest racist attack

07.18 In Sinclair's New 'Must-Run' Segment, Former Trump Adviser Tries to Defend Racist Attacks on 'the Squad'

Daily: FAIR Blog
The Daily Howler

US Politics, Policy & 'Culture'

07.21 Of course Donald Trump is a racist – and his Wall Street enablers know it

07.21 A court ruled it was legal for guards to strip search female inmates and force them to remove their tampons in front of male officers for a 'training exercise' [The frequency and degree of immorality and degradation being reported in the media is very disturbing, as if society has been reprogrammed overnight to be more like the worst behavior of Nazi Germany]

07.21 THE DEMOCRATIC PARTY IS GETTING CRUSHED IN FUNDRAISING: “THEY NEED TO GET THEIR SHIT TOGETHER” [Since so-called moderate Democrats will prostitute themselves in many conceivable ways (offering that special quid pro quo) they have effectively become competitively ANTI-PUBLIC, like Republicans. Whereas progressive Democrats must promise not to take corporate donations at all as an effective litmus-test. The DNC refuses to raise funds for moderate and progressives separately, and thus donations fall short. Which is it to be: 1) Will the DNC change? or 2) Must progressive Democrats become corporate whores too? or 3) Maybe you don't need corporate contributions at all if your policies are fantastic?]

07.21 State and Local Taxes Are Worsening Inequality

07.21 State and Local Taxes Are Worsening Inequality

07.21 We're no longer in Brave New World. We're back in 1984. [1:35 video; Our despicable President is at it again]

07.21 BALTIMORE'S FILTHIEST HOODS [7:38 video. Ask your governments, why are our cities so much worse than Europe's? Why is our healthcare worse and so much more expensive? And why are our Billionaires so much richer? Ask if those results of bad government are all related, and why? Are they all caused by a power-elite with greed-obsessed immorality?]

07.21 Nancy Pelosi's Dem Socialist Challenger Shahid Buttar: "We're Gonna Win" | Full Interview [5:43 video]

07.21 Jon Stewart goes viral excoriating Rand Paul after blocking vote [9:02 video]

07.21 Nicolle Wallace Refuses to Broadcast Trump Live [5:43 video]

07.21 Sassy Bernie Sanders Sh*ts on Jeff Bezos on His Home Turf... Numerous Times [17:22 video]

07.20 Puerto Rico: top US politicians join chorus calling for governor's resignation

07.20 Fact check: Trump says Puerto Rico got $92 billion. They've seen only a fraction [If he opens his mouth, Trump's lying.]

07.20 "Trump Says Go Home, Ilhan's Community Says Welcome Home": Rep. Omar Greeted With Cheers of Love and Support in Return to Minnesota

07.20 WATCH: Amid Extreme Anti-Refugee Push, Trump Displays Neither Interest Nor Knowledge of Asylum Seekers' Plight in Oval Office Meeting

07.20 Trump Denies Being at North Carolina Rally [Not sure if Trump supporters 'get' satire, but here goes....]

07.19 Are progressives working on a climate plan for 2021? You bet.

07.19 House Democrats demand Hope Hicks clarify testimony after Cohen document dump

07.19 The 51 most outrageous lines from Donald Trump's repugnant North Carolina rally

07.19 The Real Meaning of ‘Send Her Back!’

07.18 Alexandria Ocasio-Cortez on Breaking up Homeland Security

Justice Matters

07.19 UN urged to act over 'purge' of Turkey's lawyers by Erdogan

07.19 DOJ Releases Strong Evidence of Trump’s Campaign Finance Violations But No Explanation of No Charges [The statement]

High Crimes vs. Human Rights

07.19 Conscientious objectors of first world war – their untold tales [The record proves they were morally right by avoiding violent early deaths of their cousins and themselves]

Economics & Corrupt Capitalism

07.18 Corporate tax cuts blocked at least 15,000 affordable homes in California. Here’s how

International & Futurism

07.21 Millions face hardship as Zimbabwe comes close to ‘meltdown’

07.21 Spain set for socialist-led government after Iglesias deal [Some loaded drama going on here...]

07.20 US to deploy troops to Saudi Arabia in face of 'credible' regional threats [Working with Osama bin Laden's godfathers, Trump wants to profit like Erik Prince (for-profit education secretary Betsy DeVos' brother) of Blackwater infamy (hurriedly renamed ‘Academi’), the U.S. taxpayer to pay inflated costs while Trump siphons off long-term emolument largesse]

07.20 Iran on 'dangerous path' with seizure of Stena Impero, says UK [Which is this, a tit or a tat?]

07.20 'Dark satanic mills': Tony Abbott continues his crusade against wind turbines [Too much CO2 air pollution makes you stupid, and turns your country into an “Idiocracy” (1:36 video clip)]

07.20 Bolsonaro declares 'the Amazon is ours' and calls deforestation data 'lies' [Lazy and willfully stupid whenever it serves his purpose, just like Trump. “And the rest of you can all go to hell.” Again, just like Trump. Has your country turned into an “Idiocracy”? (1:36 video clip)]

07.19 U.N.'s Bachelet says Congresswomen opposing Trump are 'fantastic'

07.19 Iran makes 'substantial' nuclear offer in return for US lifting sanctions [Was barbaric Saudi Arabia—whose citizens were more involved in the 9-11 attacks—the wrong ally all along?]

07.19 “The Task Ahead Is Enormous, and There Is Not Much Time” [Read this and learn. Or read Donald J. Trump (@realDonaldTrump) | Twitter and/or President Trump (@POTUS) | Twitter. Are you serious? Or are you in hideously criminal denial?]

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  Is the Bail Out Breeding a Bigger Crisis?
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ECONOMIC COMMENTARY:

Is the Bail Out Breeding a Bigger Crisis?

A Future of Inflation, High Interest Rates and a Hollow Dollar?

by Paul Craig Roberts
Thursday, 26 March 2009
The monetization of debt threatens inflation, high interest rates, and depreciation of the US dollar and loss of its reserve currency role. Clearly, the Obama administration needs to broaden its perception of the predicament to which financial deregulation and offshoring have brought the US economy.
At his March 24 press conference President Obama demonstrated that he is capable of understanding issues as presented to him by his advisers and able to pass on the explanations to the press.  The question is whether Obama’s advisers understand the issues.

Obama’s advisers are focused on rescuing banks and the insurance company, AIG.  They perceive the problems as solvency and paralyzing uncertainly or fear.  Financial institutions, unsure of their own and other institutions solvency, hoard cash and refuse to lend.  Credit is needed to get the economy moving, and the Federal Reserve and Treasury are doing their best to inject liquidity and to remove troubled assets from the banks’ books.

This perception of the problem and the “remedies” being applied, might be causing a greater problem for which there is no solution.  Obama’s approach, and that of the previous administration, requires massive monetization of debt by the Federal Reserve and massive new debt issues by the Treasury.

The unaddressed question remains:  Is the US dollar’s status as world reserve currency threatened by the debt monetization and multi-year, multi-trillion dollar issuance of new Treasuries?

The United States has become an import-dependent country.  The US is dependent on imports for energy, manufactured goods including clothes and shoes, and advanced technology products.  If the US dollar loses its reserve currency status, the US will not be able to pay for its imports.  The ensuing crisis would dwarf the current one.Roberts' book

Obama’s advisers believe that the US can monetize debt and issue new debt endlessly, because America’s capital markets are the deepest and most liquid.  The dollar is strong, Obama said at his press conference.

But already cracks and strains are appearing.  The day after Obama’s press conference, an auction of UK bonds, known as gilts, failed when bids fell short of the supply offered and interest rates rose.  This is a bad sign for Prime Minister Gordon Brown’s plan to market an unprecedented amount of new debt during the current fiscal year.

It is also a bad sign for Obama’s similar plan. In the US, interest rates on US Treasuries have risen in anticipation of unprecedented new Treasury issues despite the Federal Reserve’s recent announcement that it intends to purchase $300 billion of existing Treasuries held by the banking system.

Normally, Fed purchases raise bond prices, thereby lowering interest rates.  However, the inflation and interest rate implications of the unprecedented supply of new Treasuries necessary to finance the multi-year, multi-trillion dollar budget deficits are beginning to be recognized in bond and currency markets.  Everyone knows that the Federal Reserve will monetize the new debt issues rather than allow a Treasury auction to fail. Recently, America’s largest creditor, China, expressed concern that the value of its massive holdings of US dollar investments is in danger of being inflated away.

The Fed cannot monetize new Treasury issues without the word getting out.  If and when this happens, the US dollar’s exchange value is likely to drop while interest rates and inflation rise.

To avoid a crisis of this magnitude, the US needs to focus on saving the dollar as reserve currency.  As I previously emphasized, this requires reducing US budget and trade deficits.

Despite the near-term budget costs of ending the occupation of Iraq and the war in Afghanistan, terminating these pointless military adventures would produce immediate large out-year budget savings.  Closing many foreign military bases and cutting a gratuitously large military budget would produce more out-year savings.  The Obama administration’s belief that it can continue with Bush’s wars of aggression while it engages in a massive economic bailout indicates a lack of seriousness about America’s predicament.

Rome eventually understood that its imperial frontiers exceeded its resources and pulled back.  This realization has yet to dawn on Washington.

More budget savings could come from a different approach to the financial crisis. The entire question of bailing out private financial institutions needs rethinking. The probability is that the bailouts are not over.  The commercial real estate defaults are yet to present themselves.

Would it be cheaper for government to buy the shares of the banks and AIG at the current low prices than to pour trillions of taxpayers’ dollars into them in an effort to drive up private share prices with public money?  The Bush/Paulson bailout plan of approximately $800 billion has been followed a few months later by the Obama/Geithner stimulus-bailout plan of another approximately $800 billion. Together it adds to $1.6 trillion in new Treasury debt, much of which might have to be monetized.

Could this huge debt issue be avoided if the government took over the banks and netted out the losses between the constituent parts?   A staid socialized financial sector run by civil servants is preferable to the gambling casino of greed-driven, innovative, unregulated capitalism operated by banksters who have caused crisis throughout the world.

Perhaps the Federal Reserve should be socialized as well.  The notion of an independent, privately-owned Federal Reserve system was never more than a ruse to get a national bank into place.  Once the central bank is part of the state-owned banking system, the government can create money without having to accumulate a public debt that saddles taxpayers and future budgets with hundreds of billions of dollars in annual interest payments.

Free market ideologues will say the government would inflate.  However, the government has been inflating for generations and is now set on a course for hyperinflation.  Monetization of troubled financial instruments by the Federal Reserve is just beginning.  In addition, there are the multi-trillion dollar budget deficits which probably cannot be financed other than by monetization of new debt issues.

The US money supply as measured by cash in circulation and demand deposits (checking accounts) is currently about $1.4 trillion.  If this year’s budget deficit is monetized, the money supply doubles. If next year’s budget deficit is monetized, the money supply would have tripled in two years.  Inflation would explode.  The combination of high unemployment and high inflation would be devastating.

In contrast, protecting depositors is not inflationary. It merely prevents monetary contraction.

If the Obama administration can think about socializing health care as a single-payer system, it should be able to think about socializing the banking system.  Currently, Medicare is paid for by taxpayers, Medicare beneficiaries, healthy retirees, and doctors.  Beneficiaries have to pay substantial premiums for supplemental coverage whether ill or healthy, and doctors are paid a pittance from the schedule of fixed prices.  The insurers are the ones who make money, not the medical service providers.  The single-payer system would shrink costs by the amount of the health insurance industry’s profits and the enormous paperwork and enforcement compliance costs.

The trade deficit is even more difficult to address.  The American economy lost much of its manufacturing leg to offshoring.  It has now lost its real estate and financial sector legs.  Real incomes for the average family have not increased.  The consumer-demand-driven economy became dependent on the accumulation of consumer debt, which has reached its limit.

When the production of goods and services for the domestic market is moved offshore, Americans lose income and the economy loses GDP.  When the goods and services produced offshore return to be sold to Americans, they constitute imports that widen the trade deficit.

The US finances its trade deficit by turning over to foreigners ownership of existing US assets and their future income streams, which, of course, increases the flow of income away from Americans.

The claim that low prices in Wal-Mart compensate for all these costs is ridiculous.  Nevertheless, the Obama administration, corporation executives, and the economics profession remain committed to offshoring.

The claim, expressed by Obama at his press conference, that retraining programs are the solution to manufacturing and IT unemployment caused by offshoring is also ridiculous.For a decade the only source of American job growth has been domestic services that cannot be offshored, such as hospital orderlies, barbers, waitresses and bartenders. Retraining is simply a government subsidy to educational institutions, a subsidy that insures their continued support for offshoring.

The enormous trade deficit that has been created by the pursuit of short-term corporate profits can only be closed in two ways.  One is to stop the offshoring and to bring home the offshored production.  Possibly, this could be done by replacing the corporate income tax with a tax based on whether value added to a company’s output occurs domestically or abroad.

The other way the trade deficit can be closed is by the inability of Americans to pay for imports.  If debt monetization wrecks the dollar and drives up import prices, Americans will have to learn to live with less imported energy and manufactured goods.  American annual consumption would shrink by the amount of the trade deficit.

The Bush/Obama approach to the crisis in the financial sector is to monetize existing debt and to accumulate enormous new debt that will likely also require monetization.  The monetization threatens inflation, high interest rates, and depreciation of the US dollar and loss of its reserve currency role.  The accumulation of new public debt implies larger annual interest payments that could make future deficit reduction problematic.  Clearly, the Obama administration needs to broaden its perception of the predicament to which financial deregulation and offshoring have brought the US economy.


Paul Craig RobertsPaul Craig Roberts is an economist who served as an Assistant Secretary of the Treasury in the Reagan Administration earning fame as the "Father of Reaganomics". He is a former editor and columnist for the Wall Street Journal, Business Week, and Scripps Howard News Service. He is the author of Supply-Side Revolution: An Insider's Account of Policymaking in Washington; Alienation and the Soviet Economy: The Collapse of the Socialist Era and Meltdown: Inside the Soviet Economy, and is the co-author with Lawrence M. Stratton of The Tyranny of Good Intentions: How Prosecutors and Law Enforcement Are Trampling the Constitution in the Name of Justice.

This article is published in the Baltimore Chronicle with permission of the author.



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This story was published on March 27, 2009.

 

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