Links 10/23/10

I promise to get to some more serious posts over the weekend, but frankly, I need a bit of a breather.

WikiLeaks has posted its second Iraq trove, nearly 400,000 pages. The New York Times, Guardian, Le Monde, and Der Spiegel got embargoed documents. The New York Times claims, “…the Iraq documents provide no earthshaking revelations, but they offer insight, texture and context from the people actually fighting the war.” The Guardian headline suggests they are more signficant: “Iraq war logs: secret files show how US ignored torture.” And the Financial Times goes further: “US soldiers killed unarmed civilians, WikiLeaks claim“. So why does the Grey Lady minimize this account? Is it that the US use of torture is so routine that the Times does not consider the ugly details in the WikiLeaks documents to be much of a revelation? FYI, the Guardian summary provides a better overview than the NY Times. It also has a gripping interactive log which covers the abuses that took place on a typical day in 2006.

Atrocity Now: Wikileaks Release Puts Spotlight Back on Continuing War Crime in Iraq Chris Floyd

The Way We Treat Our Troops Bob Herbert, New York Times

U.S. Seeks Wider Role for CIA Wall Street Journal. Exactly how secret is this “secret” CIA effort if it is in a front page story in the Wall Street Journal?

Every email and website to be stored Telegraph (hat tip reader May S)

Wary of Google Street View? Move, CEO says MarketWatch

Mandelbrot tips off the markets Christopher Caldwell, Financial Times

Statement On The Kotok Plagiarism Gonzalo Lira

How To Think About QE2 (Wonkish) Paul Krugman. Consistent with a study by Jim Hamilton we pointed to earlier, that found that the first round of QE lowered long bond rates by a grand total of 17 basis points.

QE: The Numberless Oblivion Andy Xie, Caixin. This piece is unhinged in some respects, but also makes some good observations. Not Xie’s best work, but nevertheless worth reading.

U.S. Prevails in Trade Dispute With China New York Times

Court lifts ban on $2.7bn debt collection Financial Times

‘Super-councils’ plan would redraw the map of London Independent (hat tip reader May S)

The World’s Jon Stewarts Foreign Policy (hat tip reader Valissa)

England’s Recovery Plan is Bullocks Marshall Auerback, The Daily Beast

Fraud in foreclosure summons a disturbing trend in Duval County Florida Times-Union (hat tip reader pdgrey)

Foreclosures spawn new attitude to ownership Financial Times. Be sure to read the last 1/3 of the article.

Exclusive Excerpt: America on Sale, From Matt Taibbi’s ‘Griftopia’ Rolling Stone (hat tip reader Emanillo Z)

Foreclose on the Foreclosure Fraudsters, Part 1: Put Bank of America in Receivership William Black and Randall Wray, Huffington Post. Today’s must read.

Antidote du jour. I know some of you like only mammals as antidotes, but I try to be non-discriminatory, and this is a handsome snake, independent of its accessories:

Picture 22

Print Friendly, PDF & Email


  1. jbmoore

    The snake is also a non-native species in Florida and elsewhere because snake owners released them after they grew too big to care for. There are invasive mammal and bird species as well, but they can be controlled to a certain extent.

  2. attempter

    1. Re super-councils:

    I knew the moment I saw the headline that it was an anti-democratic vector.

    Power in the end must and will decentralize, truly federalize, but for the moment there’s no end to the system drive to further centralize it.

    They’re squawking about “cost”, as part of the “austerity” crime syndicate. The answer to high costs of government is to devolve the worthless and parasitic bloated upper layers of government, get rid of political “professionals”, and move toward true democratic citizen councils.

    Anyone who really cared about cost would advocate that on cost grounds even if he was oblivious to the democratic and moral imperatives involved.

    And here’s a typical example of the might-makes-right argument:

    “To achieve this in the age of austerity, we need to seriously examine new ways of working including sharing service provision with other local authorities.”

    The “age of austerity” is of course no natural fact but a purely artificial, politically chosen campaign of robbery. So in a quote like this the robber sticks you up and then says, “In the age of there being a gun in your ribs, you need to seriously examine reducing your service provision since your cash on hand is naturally being reduced.”

    The NYT magazine has a letter today from some professional swine decreeing that “Big Agriculture is a natural fact, and it’ll only get bigger.”

    Leaving aside his ignorance of resource realities, this is really the criminal depicting his violent stickup as a law of nature rather than the might-makes-right thuggery which it is, and which we can change at will by fighting back.

    All such arguments boil down to a thug shooting someone in the head and then saying that proves whatever the deceased was doing can’t work.

    2. Re summons fraud:

    He had been paying more than $600 a month to Chase Home Finance for two years, along with a $4,800 origination fee, hoping for a loan modification. It wasn’t until the modification was denied that he realized that none of that money had gone toward his mortgage and that he owed more than $30,000 in back payments and penalties.

    That’s when he went to attorney David Goldman, who looked Jeffs up on the County Clerk of Courts’ website and found that he was being sued for foreclosure. Jeffs, who had been in regular contact with Chase, said he’d never been informed of that.

    I sure hope more people are going to read stuff like this and think twice before they pay one cent more. There’s an excellent chance anything you pay will simply be embezzled like this, apparently “legally”.

    The diction of this sentence is funny:

    While there is no simple way to know how often every type of irregularity occurs, there is documentation showing a sharp rise in one narrow area of concern.

    3. There’s no link on this, but I’d like to register my Schadenfreude over NPR’s plight. All that hard work at appeasement and corporate propaganda, and here they are right back where they started, as the villified “public broadcasting liberal media”.

    Couldn’t have happened to a nicer bunch of deficit scaremongers, jingos, and torture apologists.

  3. Neil D

    Joe Nocera at the Times has an article about the foreclosure problems at BofA.

    All good until the end when he says he’s mad at the banks and wants them to feel pain but thinks if we halt foreclosures and weaken the banks we’ll be back to September 2008. “Banks: We can’t live with them, and we can’t live without them. It stinks, doesn’t it?”

    That’s wrong. We can live without them. Many are, however, unwilling to make the sacrifices necessary to do that. It would mean giving up on the “dream” of home ownership. As nasty as the banks are – and I agree they are really nasty – it boggles my mind that we haven’t yet decided to stop playing their game. We are still refinancing mortgages, asking for loan modifications, buying new houses, using our credit cards, and trading stocks in our portfolios. Stop using the services of banks and they won’t have the power to wreck your life. It really is that simple.

    1. Eclaire

      Check out Barry Ritholtz’ blog where he takes Nocera a few steps further: we can’t live without banks, but we certainly can live without the current, incompetent ones. He suggests “going Swedish” if they come to the taxpayers, hat in hand again.

  4. Richard Kline

    Black and Wray: “Lenders that are control frauds create criminogenic environments that produce “echo” epidemics of control fraud in other professions and industries.” That exact thought passed through my noggins in inchoate form yesterday. I’m grateful for the authors for a precise and quotable formulation. We see this in many large frauds, like those run by Madoff and Bernie Ebbers for example. The first frauds are in the black, maybe, but before long _none of the numbers are good_. The first time you finish in the red, there’s no way out but more layers of fraud to not only hide the loss but to hide the ‘fix.’ Everything spirals from there. So we see in entire industries. If a bucket shop can get bad mortgage paper funded, those writing good papers get crushed out of the market in the stampede—but everything going upchannel is bad paper then, necessitating co-conspirators at every pay station. It’s Gresham’s Law on green cocaine: bad practice drives out good. This is what the land of no regulation looks like: the land of lawlessnes. The only growth industries in that kind of environment are Big Money and Hot Guns. Just ask Mexico.

    Regarding the Wikileaks publication, to me the most salient aspect is the extent to which the widespread and casual killing of civilians by just about everyone starting with the occupying forces was pervasive. This was clear at the time, and has been clear in those attempting to accurately document the phenomenon, but gets no traction in the English language press, and is not accepted into American consciousness. We created a free fire zone where enormous numbers were simply snuffed out. An independent analysis finds 15,000 probable deaths in the documents _reported NOWHERE_ previously, and this in a context where the reporting of the documents is, effectively, casual rather than systematic: civilian casualties are only mentioned incidentally so the actual number is far higher. There’s nothing in the occupation which justifies the enormous loss of life.

    I’m reminded powerfully of the European conquest of the Americas, and even more the European occupation of Africa. Exterminating the indigenes wasn’t by any means the goals of those who pushed either process in the main: they just didn’t care if those who lived there got massacred in the pursuit of the occupiers intentions, whatever those happened to be at the time. This aspect of imperial ambition is _by no means_ restricted to Euro-American actions, it’s intrinsic to imperial enterprises.

    1. Kevin de Bruxelles

      Maybe to turn this around 180 degrees, what I find shocking is the belief, widely held in America, that war can be anything but a massacre of innocents. War is hell, it always has been, and always will be, as your examples so clearly demonstrate. It is impossible to sanitize it. Sure rules and conventions will be made that blunt some of its worst aspects to some extent. But the fundamental hell remains.

      Which means there better be damn good reasons for ever engaging in a war; because it will be hell.

      1. Jim S

        A rather weak riposte I’m afraid–we Americans have largely inherited our military theory from you continentals, one of whom had said that “war is a continuation of politics by other means”. And while we understand that while those warlike Prussians and French and Russians and Swedes (and English too) may be an embarrassment to you now, like a raft of crazy uncles, you do have to take responsibility for them.

        As to the question of how many civilian casualties were unreported, certainly some: after the Samarra mosque was bombed and the gloves came off, one fellow I talked with described how he stopped taking his patrol out for a while because the sight of whole families laying in the street became too much for him–Sunni killed by the Mahdi Army or Shia killed by Al Qaeda, whichever. But we staved off civil war then, and I would be careful about speculation, because figures like a half-a-million to a million deaths as claimed by some surveys would require a civil war to achieve.

        1. Kevin de Bruxelles

          You might have misunderstood what I meant. I don’t think I’m trying to claim that Europeans were somehow “nicer” when they went to war or were somehow morally superior. Far from it. Since all war consists of the slaughter of innocents, the only possible difference between historic European wars and current American ones is that for the most part, Europeans back in the day had fewer illusions of what war meant. They went in and slaughtered innocents with their eyes wide open!

          Von Clausewitz, who you refer to, hardly tried to sanitize war. For example he says:

          Now, philanthropists may easily imagine there is a skilful method of disarming and overcoming an enemy without great bloodshed, and that this is the proper tendency of the Art of War. However plausible this may appear, still it is an error which must be extirpated; for in such dangerous things as War, the errors which proceed from a spirit of benevolence are the worst. As the use of physical power to the utmost extent by no means excludes the co-operation of the intelligence, it follows that he who uses force unsparingly, without reference to the bloodshed involved, must obtain a superiority if his adversary uses less vigour in its application. The former then dictates the law to the latter, and both proceed to extremities to which the only limitations are those imposed by the amount of counter-acting force on each side.
          I find Von Clausewitz, while obviously a great thinker, a bit of a Neanderthal with his frontal direct approach on pure strategy, and prefer the indirect approach of a Basil Liddell Hart or a Sun Tzu, whose approaches if used correctly actually could disarm an enemy without great bloodshed. Just look at the difference between the Von Clausewitz style WW1 German invasion of France which ended up in a stalemate with millions killed compared with the Liddell Hart inspired WW2 German invasion of France where they conquered the whole country with minimal slaughter. But Von Clausewitz’ quote shows clearly that Europeans were under no illusions of what they were getting into when they went to war. Americans on the other hand have this idea that professional soldiers are going to go in and win the native’s “hearts and minds” while these well-trained American soldiers go around and very carefully only kill the bad guys. And then many Americans are later shocked when the truth leaks out to find out that war doesn’t work that way.

          Where I do see similarities with the current naive American attitude and the historic European one is on colonialism where Europeans are still often seriously deluded as to the massive number of people they killed trying to “civilize” their colonial subjects.

  5. Susan

    Ms. Smith, stop apologizing about the links! We are so fortunate to have your own ongoing analysis; you don’t have to cover the entire web waterfront as well. You are the best. Get that breather, and keep breathing. Thanks for all you do.

    1. Jim Haygood

      ‘England’s Recovery Plan Is Bullocks’ — as in Sandra?

      Marshall A. spelt it right — BOLLOCKS. As in horse-puckey … ;-)

      1. Yves Smith Post author

        I never type the headlines that appear in Links, I always copy and paste. I assume that the headline was provided by The Daily Beast and was initially incorrect, and someone pointed out their error and they fixed it.

  6. Jon H

    “So why does the Grey Lady minimize this account? ”

    My impression from the BBC’s coverage was also that it didn’t sound “that bad”.

    Which doesn’t mean what’s reported is insignificant… I’m just surprised there’s nothing much, much worse.

    If the NYTimes was expecting worse, then that might explain their reaction. They’re a bit jaded.

  7. rjs

    sound like they’re celebrating some kinda victory in the trade dispute. with western powers having dominant control of the WTO, why would one expect anything different?

  8. An unhinged Eurozone reader

    Thanks for the link on most recent Andie Xie on Caing.

    “This piece is unhinged in some respects, but also makes some good observations. Not Xie’s best work, but nevertheless worth reading.”

    Is the piece unhinged, or the current monetary authorities? I side with the unhinged Andy Xie on this one

  9. Fatboy

    “So why does the Grey Lady minimize this account? Is it that the US use of torture is so routine that the Times does not consider the ugly details in the WikiLeaks documents to be much of a revelation?”

    A reporter for the Times, Michael Gordon, was on TV discussing the Wiki-leaks. All he wanted to talk about was the information showing Iran’s involvement in aiding the anti-American fighters in Iraq was more involved than previously believed. Beating the war drums vs. Iran as the NY Times did vs. Iraq?

  10. wunsacon

    >> WikiLeaks

    In my opinion, the NYT is an Establishment paper afraid of losing some subscribers and interviewees with right-wing views.

    To bastardize an old quote:
    “The revolution will not be printed on fish wrap.”

  11. Pwelder

    The Don Coxe conference call for Friday, October 22nd (valued by many commodity-oriented investment types) is a striking illustration of how the mortgage misfeasance story has gone mainstream – at least among investors. Coxe, a fairly crusty old-school investment advisor, shares Yves’ indignation and contempt for the performance of Big US Finance over the last few years. Disregard the WS Journal’s down-playing of Mortgagegate, he says. This is a big problem and it’s hard to see where and how it ends.

    I would guess that there are some serious implications here for QE2. The facts that Krugman lays out in today’s linked blog post are well known to the Fed. They can’t expect QE2 to do much for the real economy. So they must be looking to reflate asset prices, particularly houses. But if the housing market is under this big new additional cloud that has just materialized over the last few weeks, how much can it do for residential real estate?

    The Fed now faces a situation in which the unpredictable and possibly quite large costs of QE2 haven’t changed, but the potential near-term benefits as they appeared back in August have declined substantially. Financial policy makers have to hope – fervently – that the banks’ story line on Mortgagegate is roughly accurate, because otherwise it’s a real body blow to their strategy to contain the deflation.

    1. Cedric Regula

      They way I see it working is the Fed will do 3 trillion of QE (I think that’s roughly the amount of private label MBS out there) and that F&F&FHA will do 100% of new mortgage finance in 3% down, non-recourse loans. This way all the banks get paid off by the Fed. New buyers will ultimately get kicked out on the street over chain of title “technicalities”, but then they will be able to mail the house keys back to the F&F&FHA and settle the non-recourse mortgage. The only inconvenience is we will be moving around a lot, but this will be more than offset by jobs created in the moving industry. Wall Street will go wild over the “Next Big Thing” and banks will have 3 trillion to invest in moving company stock. GS and MS M&A divisions will consolidate the industry, while their IPO divisions feverishly IPO new startups.

      This all puts F&F&FHA under some financial strain after the MBS market questions underwriting standards, but the government responds by putting them in receivership a second time and announces their sale (for an undisclosed amount) to the Federal Reserve. The Fed renames the entity “Home Federal Savings and Loan”, and the new CEO, Angelo Mozilo, announces HFSL is open for business as usual.

      But that’s just my unhinged brain extrapolating too much again.

      1. Yves Smith Post author

        The people I know who are savvy are of the reverse view, that any QE the Fed does will be underwhelming. It’s banks keen to get their clients into “risk on” trades that have been pushing the view that the Fed can and will save everybody and will therefore do a sizeable QE2.

        While the Fed did ride to the financiers’ rescue, it underreacted first, then when things started to come unglued, started taking extreme measures.

        The Fed isn’t prepared to pull out all stops to fight unemployment the way it was to save its favorite children, the banks.

    2. reslez

      When all you have is a hammer everything looks like a nail. Also, as Cedric stated, it quite elegantly sets up the purchase of trillions of MBS whenever that becomes necessary. The Fed has no other levers to pull.

      Fiscal policy is the only option left. But based on the experience of Japan and 1930s America it seems that single currency thinking (gold standard) is so psychologically ingrained it really will be impossible for modern economies to “MMT” their way out of this mess. Deficit hysteria strangles recoveries before they can take hold. The instant things no longer look so grim (or perhaps even before) deficit hawks swoop down and drop austerity bombs on the population. The economy lurches back into recession. And the innate desire of corrupt leaders to sweep everything under the rug means “extend and pretend” is the only politically feasible option. No significant debt restructuring ever takes place. Meanwhile the Fed is hell-bent on pumping up asset bubbles which leaves the economy ever more vulnerable to supply-side inflation shocks.

      Deflation-prone economies will stumble along in a haze of grim misery for the foreseeable future. There are three ways it could go:

      (1) private sector debt is repaid or restructured and savings reaches whatever level households now feel is prudent (… decades), or

      (2) deficit hawks lose all credibility in popular discourse and are purged from government (chances appear remote, the earliest it could happen in the U.S. is 6 years), or

      (3) a large bloody war erupts and balance sheets are repaired via fiscal stimulus nobody dares argue about.

      So as Monty Hall would say, Is it Door No. 1, Door No. 2 or Door No. 3?

  12. dave


    Why would Arab SWF buy their own oil to cause a bubble? That only means that they are accumulating overpriced reserves and will lose money. If the goal is to restrict supply why not just not pump as much, its the same thing but easier. But that isn’t what Arab countries did, when oil was $150 they were increasing production like mad to sell at over inflated prices. Then oil crashed. Whatever money was made on over priced oil is lost on under priced oil later. If SWF really owned a bunch of $150 oil futures then they got hosed.

    Taibbi’s articles are going downhill. The farther he goes outside his sphere of confidence the more illogically conspiracy minded they get. Here’s a simpler explanation:

    1) Oil is an expensive scarce resource we rely on foreigners for.

    2) Unless we develop new energy sources we will run trade deficits in order to purchase it.

    3) Trade deficits = foreign capital accumulation. If you don’t think states should be selling off infrastructure write you congressmen, but something will have to be sold off to fund the trade deficit.

    Its not rocket science.

    1. Jack Parsons

      4. The US dollar is the world’s reserve currency because there is so much inventory. Without a capital accounts deficit or massive overseas investment, there aren’t enough dollars abroad.

  13. Cathryn Mataga

    I checked and their top article now is “WikiLeaks Founder on the Run.” They’re playing defense the for war machine, I guess. Somewhere along the way, they just got sucked into the inner-circle of power, and now they just can’t see out of the bubble. Really the UK has more functional journalism than the USA. FT.Com just rocks, really.

    I suggest tomorrow’s headline….

    “Torture Not America’s Fault After All”

    or maybe…

    “Civilians Would Have Died Eventually Anyway”

  14. EmilianoZ

    Re: Matt Taibbi & Andy Xie

    For some time I’ve been wondering why the Saudis were still accepting dollars for oil. With the Fed embarking on another bout of massive printing, surely they must start looking at those little green pieces of paper with some misgivings. It seems to me that what is still holding the dollar is some kind of irrational faith just like the one that sustained the housing bubble. With any bubble the difficulty lies not in ascertaining their existence but in predicting the moment they will burst, the moment when something that cannot go on for ever starts unraveling.

    I think the Taibbi piece provides a clue about when that will happen. For the moment the Saudis (and other oil exporting nations) can still buy infrastructure in the US. That’s why they still accept dollars. The tipping will simply occur when they run out of stuff to buy in the US. We should make a list of what can still be sold here and compare it with the amount of dollars they hold. That should tell us how much time we still have before life as we know it ends.

    In the meantime we should make preparations for living as autarkically as we can. This needs not be a painful experience to us. It might be the opportunity to rebuild small local communities and live more simply.

    I hope Mr. Satyajit Das will be interested in reviewing Taibbi’s book when it’s out. Or maybe we should just buy his book out of gratitude for everything he has already done.

    1. wunsacon

      >> For the moment the Saudis (and other oil exporting nations) can still buy infrastructure in the US. That’s why they still accept dollars. The tipping will simply occur when they run out of stuff to buy in the US.

      Yes! But, frankly, they’re dumb if they think they can buy our infrastructure and then earn dividends from it from destitute Americans. I recall Soros said something like “poor countries don’t have earnings — they have ‘issues'”. Once Americans are broke enough, foreigners will discover that their US operations just have “issues”.

  15. rd

    I am still confused why the numerous attornies working for the banks still don’t understand this sentence or have not pointed it out to their clients:

    “No person shall ….. be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation”

  16. leroguetradeur

    Auerback’s piece is one of many that laments the Great British Cuts, described as huge, and claims that they will have terrible effects. But, like everyone else who offers this argument, he never says what exactly these cuts are.

    In fact, and its an astonishing fact given the chorus of commenter aboout the matter, there are no cuts. That’s right, government expenditure is not actually being reduced. What is happening is that the rate of growth is being reduced.

    Here is what the Treasury says:

    “Even after these spending cuts, total public spending (Total Managed Expenditure) in 2014-15 will be higher in real terms than in 2008-09. At 41 per cent of GDP, this will be around the same level of public spending as in 2006-07. Spending on public services in 2014-15 will be higher than 2006-07 levels in real terms.”

    Here are the numbers Osborne is forecasting: over the next four years we have a rise in spending from £696 billion to £739 billion.

    You wonder how this can count as a ‘cut’? Well, it would have risen to something like £760 billion if not for these wholly imaginary ‘cuts’. The fact is, there are no cuts in Britain. If you think cutting government spending is a problem, stop worrying and go back to sleep. Government spending is still rising just like it was, but a little bit slower, that’s all. The debate you need to have is how fast you want it to rise, not whether it needs to rise.

    Before you start proclaiming that the fall in red wine consumption are going to lead to a heart attack epidemic, you would think you’d check to see that red wine consumption actually is falling?

    But hey, don’t believe me, go and see for yourself. As R D Laing used to say.

    1. Yves Smith Post author

      From Marshall Auerback, via e-mail:

      This guy completely falls for the spin put out by Treasury. This is based on Treasury’s GDP forecasts. They assume GDP growth so assume that government expenditures as a percentage of GDP will be higher than they are today. It ignores the impacts of today’s cuts which are REAL. It’s true that the number of 83 billion pounds is a bit of an accounting gimmickry, but here are some details from the IFS:

      1 The coalition government has a plan to cut public borrowing over the next few years. They have announced policy measures which mean that in 2014-15 they now expect to borrow £113 billion less than they would have done in the absence of any policy action

      2 Their plan to cut borrowing comprises 26% (or £29bn) coming from measures to increase tax revenues and 74% (or £83bn) from measures to cut spending. (£52bn of the spending cut and £21bn of the tax increase was inherited from the previous Labour government.) Again, tax revenues are endogenous and dependent on economic performance, so not clear that they’ll be as high as the gov’t now forecasts, so you might have higher deficits (as I expect will happen).

      3 The government announced in its June Budget that they will cut £11bn from welfare spending by 2014-15. By cutting borrowing over the next few years, the government estimates it will have to spend £10bn less on debt interest payments by 2014-15, which helps to contribute to the overall spending cut. Again, it assumes that there will be more growth and therefore less borrowing. In addition, in May the coalition government announced about £6bn of cuts to departmental budgets this year. Taking out these cuts leaves £54bn more spending cuts to be allocated in the Spending Review (these figures do not sum due to rounding).

      4 But all the figures mentioned above are in 2014-15 prices, which makes them sound larger than they really are. It is probably more sensible to convert them into current prices. In today’s prices, £54bn equates instead to £49bn. This is the overall spending cut that is to be allocated in the Spending Review on Wednesday.

      All of this ignores the fact that austerity comes with the risk of negative feedback: government spending cuts lead to lower output and larger deficits. It knows it runs the risk of hitting the economy so hard that it under-performs its own projections – so that in a worst case it will have to compensate for stagnating tax revenues by having to put taxes up, in a self-defeating loop. There are also extra charges for housing benefits, withdrawal of child benefits for anybody with incomes above 40,000 pounds a year.
      There is ample economic evidence to suggest that the fiscal actions taken thus far are having an impact on the economy already. I’ve read the spending statement. The overall spending cuts are the biggest since the second world war, with reductions to departmental spending the worst since the 1970s, according to the Institute for Fiscal Studies think-tank.

      I find it interesting that the very same people who decry gov’t as a fraud and assume that they lie about everything, but are prepared to accept the Treasury’s statements here at face value. There is no doubt in my mind that the case for fiscal austerity is based on the ideological hatred of government intervention rather than any sound economic case that the cutbacks will improve the aggregates we are usually concerned with – output and income growth, reduced unemployment, low inflation etc. It is clear to me that the fiscal austerity approach – for example, epitomised now in the announcement in the UK earlier this week – will FURTHER damage employment growth and undermine economic growth.

  17. leroguetradeur

    “…very same people who decry gov’t as a fraud and assume that they lie about everything, but are prepared to accept the Treasury’s statements here at face value”

    Not me. Not one of those people, and don’t know any. I do think when the Treasury reports rising expenditures in real terms, they are not lying.

    The UK case for fiscal austerity? There isn’t any such austerity. But there is a UK case for reducing welfare payments and for reducing the vast number of civil servants. Marshall should explain why people making double the average wage should be given grants by the state for having children. Does he think this makes sense? Why do we have in an area smaller than Cook County three layers of government, town, district, county? Does that make sense?

    There is no austerity in the UK. What there is, there are reductions in wasteful and counterproductive spending and employment. Marshall should come to the UK, stay with my friends as they go about their daily lives, and see for himself. Go into a district council office and see people moving more slowly than previously thought possible. Talk to some girls whose idea of growing up is learn as little as possible, have a baby, get a house from the council and live on child benefit and housing benefit…. etc

Comments are closed.