Links 3/4/11

Memristor Processor Solves Mazes Technology Review (hat tip Richard Smith)

IMF warns food prices to stay high Financial Times

U.S. cables detail Saudi royal welfare program Reuters (hat tip reader Tim C)

Ohio GOP may invite backlash with tough stance on unions Washington Post

For Boards, S.E.C. Keeps the Bar Low Floyd Norris, New York Times

Banks, Mars, and Venus Bethany McLean, Slate (hat tip reader Bob H)

A Conspiracy With a Silver Lining William Cohan, New York Times

Breaking News: Tax Revenues Plummeted David Cay Johnson (hat tip reader Tim C)

What Should Corporate Tax Reform Look Like? Off the Charts (hat tip reader Tim C)

Mr Contagion, 1989-2009 FT Alphaville (hat tip Richard Smith)

Insurance and Banking: Risk, Resiliency and Harmonisation London Banker (hat tip Richard Smith). Today’s must read.

Antidote du jour:

Screen shot 2011-03-04 at 6.54.41 AM

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  1. rjs

    just to add a link, from dave cohen:

    Why Give A Damn? – I have said on this blog that the assholes are in charge, and there’s little we can do about it. I called these assholes sociopaths in an older post. In a Good Society, it is the task of every citizen to try to ensure that there are restraints on what the assholes can and can not get away with. Unfortunately for us, it appears that we’ve lost that fight. In fact, I believe that when American citizens started being called “consumers” and did not object, the good fight was already lost. But there are subtle forms of resistance, as I explained (in part) in my post Thinking Outside The Box. If living outside the destructive cultural trance is the only avenue available to you, that is the path you must pursue. Doing that work is certainly the Road Less Traveled, but if nobody goes down that road all will be lost. Ultimately, what is at stake here is the future of civilization. If you don’t give a rat’s ass, then I suppose another Dark Age similar to that which occurred after the fall of Rome is OK with you. That would be a world where learning has disappeared, where might makes right, where you’re dirt poor, where you give most of what you make to your owners, and you have no property rights or human rights. But that outcome is not OK with me, and I hope it’s not OK with you.

    1. wunsacon

      “Idiocracy” was almost a documentary. It seems to me that Mike Judge mainly removed the malevolence.

      The debate over “Brawndo” killing the plants might as well be the global warming debate. When I read someone (in the “real” world) say “It’s still four seasons in my area”, how different are they from the eejiots in that movie?

    2. Birch

      That’s a very out-dated view of the ‘Dark Ages’. Just because not much was written during the time after the fall of the Empire does not mean that it was a bad time to be a peasant.

      Indeed, it is likely that the collapse of big armies, super-duper rich elites, and central government made way for more egalitarian community-based societies. With Athenian direct democracy still alive in oral history, and the teachings of Jesus more prominent and widespread than the fledgeling heresy of Catholisism, there were many un-recorded regions left to their own devises for a few hundred (or in some places over a thousand) years. That this era has traditionally been viewed as unpleasant and undesirealbe says more about the society and biases of the historians (industrial revolution Europe and classical economics) than about the era itself.

      This view of ‘Dark Ages’ serves to strongly support oppressive mis-representative democracies. “Put up with what we give you, because the alternative is worse!” Bull****. Once we’ve done away with our imperial debt-slave masters, we will have plenty of oportunity to build a functional decentralized society based on people and community rather than corporations and ‘free’ markets.

      Free da people, enslave the markets.

      1. Firean

        A good point regarding the so called “Dark Ages, seldom proposed and one which I agree.

  2. anon


    Does anyone happen to know what kind of animal is perched in the antlers? While I realize that’s not the most pressing of questions, today’s antidote has sparked a debate about raccoons that has yet to be resolved by diligent use of various search engines.


    1. Jon H

      Those look like lorises. But I don’t think the loris lives where elks or whatever live, so that might be a photoshop.

      1. anon

        We’re thinking of going with the lorises. And the photoshop.

        Thanks for taking the time to respond!

      2. MyLessThanPrimeBeef

        I think we can safely rule out Yoda Bat.

        Could be a distant, very distant, relative of the tarsier.

    1. DownSouth

      Re: “Breaking News: Tax Revenues Plummeted” David Cay Johnson


      “What Should Corporate Tax Reform Look Like?” Off the Charts

      Cay Johnson said: “There is a simple, factual way to describe what is happening to our government: We have a revenue problem.”

      A couple of weeks ago the congressional Joint Committee on Taxation released a report, which can be found here, called “PRESENT LAW AND HISTORICAL OVERVIEW

      The single most important fact revealed by the report, the one that just screams at the top of its lungs to be heard, was this:

      In 1952, the year I was born, 32.1% of federal receipts were paid by corporations. In 2009, the last year that data was available, corporations paid only 6.6% of federal receipts.

      Absolutely unbelievable!

  3. DownSouth

    Re: “Breaking News: Tax Revenues Plummeted” David Cay Johnson


    “What Should Corporate Tax Reform Look Like?” Off the Charts

    Cay Johnson said: “There is a simple, factual way to describe what is happening to our government: We have a revenue problem.”

    A couple of weeks ago the congressional Joint Committee on Taxation released a report, which can be found here, called “PRESENT LAW AND HISTORICAL OVERVIEW OF THE FEDERAL TAX SYSTEM.”

    The single most important fact revealed in the report, the one that just screams at the top of its lungs to be heard, was this:

    In 1952, the year I was born, 32.1% of federal receipts were paid by corporations. In 2009, the last year that data was available, corporations paid only 6.6% of federal receipts.

    Fucking unbelievable!

    1. Michael H

      DownSouth: “In 1952, the year I was born, 32.1% of federal receipts were paid by corporations. In 2009, the last year that data was available, corporations paid only 6.6% of federal receipts.”

      Strange how the same people calling for austerity and cuts to social security never seem to mention the fact that corporations are paying almost five times less tax than they were sixty years ago.

      1. DownSouth

        Another fact the report pointed out was that in 1952, total government receipts as a percentage of GDP amounted to 19.0%. By 2009, that figure had fallen to 14.8%.

        So the tax load today, measured as a percentage of GDP, is considerably smaller than it was when I was born, despite all the hyperventilating to the contrary.

      2. DownSouth

        In 1975 the top corporate tax rate was 48%. Now it’s 35%. (The report doesn’t say what the corporate tax rates were before 1975.)

        In 1952 the capital gains tax was 25%, and it could only be applied up to a maximum of 50% of total income. Now it is 15%, and can be applied to 100% of income.

        1. Doug Terpstra

          Informative thread here.

          Charles Hugh Smith has a compelling article about job creation and corporate taxes (which of course can’t happen under the currrent kleptocracy):

          “To incentivize small business, we have to fix the structural imbalances in the U.S. economy. ”


          “3. Offer corporations a choice: since they’re legally considered “persons” now, then they have a simple choice:”

          “A. Pay the individual “persons” tax rate on all income, and have all corporate-specific tax breaks stripped away, or”

          “B. Renounce their Supreme Court-granted rights to “personhood” and pay 0% income tax on all non-financial-related income.”

          1. MyLessThanPrimeBeef

            Sounds like my fear – No Taxation Without Representation!

            When corporations can’t run for office, they will want 0% tax.

    2. Richard Kline

      So Down, _this_ was the Reagan ‘Revolution,’ for corporations and the rich to free themselves of taxes and regulation. That’s their version of ‘liberation’: all the benefits of running a nation state with none of the costs or obligations. Who gets the bill: take a look in the mirror folks, ’cause that counter-revolution was on you.

      1. DownSouth

        Richard, not only that, but in order to complete the picture it’s necessary to take a look at income distribution. Not only is the cost to run the nation being borne less by corporations and more by individuals (or by borrowing), but the most wealthy individuals have hogged almost all the gains in national income over the past 30 years.

        Since 1979, almost all the growth in the GDP has gone to the top 10% income households. And make no bones about it, all that concentration of pay that goes to the top 10% comes right straight out of the pockets of the bottom 90%.

        Mother Jones did a compilation recently which can be found here. To me one of the most interesting graphs is the very last one, where Jacob Hacker calculates how much more per year you would make had your income group seen the same growth rate in 1979-2005 as it did during previous a decade, that is before 100% of the growth in national product started going to the top 10%.

        • If you’re in the 81% to 90% of household incomes, you would be making $3,733 per year more.

        • If you’re in the 61% to 80% of household incomes, you would be making $8,598 per year more.

        • If you’re in the 41% to 60% of household incomes, you would be making $10,100 more.

        • If you’re in the 21% to 40% of household incomes, you would be making $8,582 more.

        • And if you’re in the bottom 20% of household incomes, you would be making $5,623 more.

      2. psychohistorian

        Its all the Dirty Fucking Hippies fault!

        This should be used as a college course in how propaganda really works….that is after the current oligarchy is removed from power.

  4. Ignim Brites

    Liberals, progressives, lefties of various stripes, and people like DownSouth, whatever they are, ought to consider that their relentless rage against the rich is just generating noise that prevents effective thought and action toward tax reform. They ignore that the cultural base of the Dem Party are the wealthy and those who want to be more wealthy. The rage against the rich is a show stopper for them even if they mimic the sentiment. It would be unsurprising if it were discovered that many of the leftist action groups are funded by the super wealthy. Anyone hear of George Soros? People ought to hone in on Warren Buffett’s comment that it is not right that his secretary should pay a higher marginal tax rate than he does.

    1. Abelenkpe

      So you agree that the super wealthy and corporations aren’t paying enough in tax but condemn those calling for the rich to share more of the burden and pay more tax?

      Tea partiers and republicans are still advocating the wealthy and corporations pay less tax and that the burden of the financial crisis be placed on the working class.. That is the main distinction between the two parties.

      1. Ignim Brites

        I didn’t say that the super wealthy and corporations aren’t paying enough in taxes. It would make more sense to argue that the rates on income (including payroll taxes) should not exceed the rates on capital income, i.e. dividends, interest and capital gains. What’s good enough for capital should be good enough for labor. Of course that might leave the revenues of the government so diminished that no one could ever propose a multi-trillion dollar propping up of the asset values of the wealthy.

    2. DownSouth

      …that truth is great and will prevail if left to herself, that she is the proper and sufficient antagonist to error, and has nothing to fear from the conflict, unless by human interposition disarmed of her natural weapons, free argument and debate, errors ceasing to be dangerous when it is permitted to freely to contradict them.
      ▬Thomas Jefferson, “The Virginia Statute for Religious Freedom”

      That’s the great thing about this forum. It gives us the opportunity to get the truth out there, something that doesn’t happen very often in the MSM.

      Then once the truth is put out there, the debate allows us to flush out people like you. In a defactualized world, you can come off as sounding moderate and reasonable. But when confronted with the cold hard facts, you are forced to take refuge in arguments that make no sense whatsoever.

      1. Paul Repstock

        Does it really matter whether we can put names/lables on the culprits? The problem is the system which allowed the situation to arrise. That system has failed, either through inherent flaws or by internal sabotage. We cannot go back. There is insufficient resources to repair the system. Even if we could repair the system, divergent interests between the haves and haves nots would preclude any bipartisan effort in that direction. I have no idea what the future will look like, I only know it is going to be a wild ride.

        1. Otter

          It was not the system which allowed the situation to arise. It was the people.

          The situation and the system will remain until the people repair both.

    3. Mr. Koch's shoes taste like courage

      Ignim Brites: “…relentless rage against the rich…”


      But everyone knows that Americans are born to worship the wealthy.

      As Thomas Frank put it:

      “..we have spent the past thirty years doing everything we could to transfer the wealth of the nation into the bank accounts of the affluent, to send them victorious, happy and glorious, long to reign over us.

      “Oh, we’ve cut their taxes, gladly transferring much of the cost of keeping their holdings safe onto our own shoulders. We’ve furnished them with special megaphones so that their voices might be heard over the hubbub of the crowd. We have conferred upon them separate and better schools, their very own transportation system, and a full complement of private security guards. We’ve built an entire culture of courtiers and sycophants to make their every waking hour an otherworldly delight.”

      “We let them build a system of bonuses and ‘executive compensation’ on the theory that it would be good for everyone if the people on top got to take home much, much more. And when it turned out that the theory was wrong – that in the most famous cases the rich chased bonuses not to the shareholders’ benefit but at their expense–why, we promptly bailed them out. We allowed them to step up to the Fed’s discount window and fill their pockets, we generously transferred their dumb investments to our balance sheet, and we sent them off with little more than a request that they please not do it again….” – Thomas Frank, “Servile Disobedience”

      Note to self: File “Ignim Brites” under “courtiers and sycophants” = “do not read”

      1. Ignim Brites

        Perhaps if I had said ineffectual rage against the rich the point would have been more taken.

  5. Paul Repstock

    The FT story on IMF/food prices is subscription, but We don’t need to read it. Look at the commodity mkts where prices are going limit up and down (mostly up) on a daily basis. I don’t suggest getting involved because you might have trouble collecting your winnings.

    However, here is a thought for everyone: If hyperinflation has taken hold, your best and safest investment is in the welfare of your family. Even if food appears expensive I think it is wise to purchase two months supply of the cheapest nonperishable staples. These should not be consumed so long as one can afford to purchase food from the store. Or so long as the store actually stocks food. All should understand that retail business cannot afford to hold inventory at these prices. Consumer resistance is cutting already thin margins and volumes.

    1. Birch

      Good suggestion, Paul.

      I think it’s good to rotate your emergency staples too. Nothing worse than the big collapse, then finding you have a pantry full of stale flour and un-softenable beans.

      I used to work at a small artisan bakery. One time, the transport company lost the week’s shipment of flour. Before the next shipment came a week after that, I went around town and bought every single sack of flour bigger than 5kg, and even started buying the little 5kg sacks. Just to keep that one little bakery in bread for the week, the town basically ran out of flour.

      1. Paul Repstock

        Yeah..So much for ‘just in time inventory’..And to think that most of the world is now living in this fragile and precarious state. Debt is only a viable option if it saves your life.

  6. Doug Terpstra

    The “Conspiracy with Silver Lining” by William Cohan is mis-linked to page two of a different article on mortgage finance by Binyamin Appelbaum, also a good OpEd purely private mortgage finance.

    “’The kind of backstop that we have now, if it didn’t exist, we would have had a much more severe recession and a much sharper fall in home values,’ said Michael D. Berman, chairman of the Mortgage Bankers Association, which represents the lending industry.”

    Well, that’s a silver lining: land and shelter not based on speculation and derivative leverage.

    The correct link to Cohan’s article:

  7. Michael H

    “None other than the US Secretary of State herself, Hillary Clinton, paid fulsome tribute to Al Jazeera last Wednesday, March 2. Appearing before a US Foreign Policy Priorities committee, she was asked by Senator Richard Lugar to impart her views on how well the US was promoting its message across the world.

    Clinton promptly volunteered that America is in an “information war and we are losing the war,” and furthermore, that “Al Jazeera is winning”.

    [Al Jazeera’s] power has long been tacitly acknowledged by the US government which has pressured US cable companies not to carry it….”

    In the early days of the rebellion in Egypt, US TV viewers had the somewhat surreal experience of seeing Al Jazeera being broadcast on one of the two sets in Obama’s office, though Al Jazeera English is blacked out to cable viewers in the US, with the exception of those in Toledo, Ohio; Burlington, Vermont and Washington DC. (This did not prevent both Obama and Mrs Clinton from decrying censorship in Iran.)….”

    One has only to watch US TV for 10 minutes to conclude that America’s communicators no longer have the intellectual resources and political literacy to mount successful, well-informed propaganda….

    1. DownSouth

      Michael H,

      The subject came up yesterday about shooting innocent civilians from helicopters, and I was unaware of the other incident mentioned in the article you linked:

      And besides, what would the state-subsidized propagandists be able to boast about? Predator raids in Afghanistan? Guantanamo? Thirty million on part-time work or jobless in the Homeland? America is not the sell it once was, when the economic growth rate was headed up and capitalism seemed capable of delivering on its promises.

      March 2 was a busy day. The Army filed 22 new charges against PFC Bradley Manning, suspected of passing classified information to the WikiLeaks website. The charges include “aiding the enemy,” — a capital offense. These charges coincided with Gen. Petraeus apologizing, also on March 2, to Afghanistan’s puppet leader Karzai for the deaths, via machine-gun from Apache attack helicopters, of 9 children, killed as they gathered firewood in a mountainous area of eastern Afghanistan. A 10th child was injured.

      1. Michael H

        Yes, I was unaware of this incident myself, and in fact posted a link to the article before reading it all the way through to the end; otherwise I would’ve excerpted the helicopter incident instead, as well as the following:

        “Petraeus gets a pat on the back for his swift effort at damage control; Manning gets charges that carry the death penalty.”

  8. Anonymous foreigner

    On Saudi’s Royal Welfare System:

    I often wondered why we don’t know much about Middle Eastern countries! Now I see it’s partly definitely intentional. Bush Junior hand in hand with the Saudi King comes to in my mind.

    Now I do believe there are a LOT of things needs to be disclosed. So far, only a tip of the iceberg has been sited.

    Thanks Wikileaks and other similar Orgs!

  9. Elliot

    :D wonder how photoshopping + elk got to be in the same imagination… the ones I see almost daily here are regal and shy, really.

    Agree as well on the benefits of the dark ages…and re-affirming one’s gardening and fix-it skills. Collapse is coming more and more quickly, I think. I laughed seeing that unemployment took a dip to 8.9%… hereabouts (northern Rockies) it’s more than twice that, what gets printed in the papers, and probably really closer to 30%…people are getting less and less sanguine about it.

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