Links 2/15/14

Quokka Baby Animals (Lambert). Apparently similar form factor to a koala but nicer personality. Would be an antidote except picture quality not quite up to snuff.

Kelud and Sinabung: Indonesia’s Two Erupting Volcanoes Atlantic. Now these pix are remarkable….

Bitter cold turns caves on Great Lakes into stunning ice sculptures – in pictures Guardian

Climate change is here now and it could lead to global conflict Guardian. Lambert: “Front page, banner headline.”

Termite robots build the future Financial Times

Graphene’s love affair with water: Water filters allow precise and fast sieving of salts and organic molecules ScienceDaily (Chuck L)

Prodigy Network Crowdfunds and Crowdsources Design for New 17 John “Cotel” in Downtown New York City inhabitat (furzy mouse). World class ugly exterior is not a promising start.

Silk Road 2 Hacked, All Bitcoins Stolen – $2.7 Million Deep Dot Web (furzy mouse)

Bitcoiners Destroy Their iPhones After Apple Removes Wallet From App Store IEEE Spectrum

Spinning wheels and shaky deals Steve Keen

US blind to barbs in Japan defense plan Asia Times

Rice farmers to get payments next week, Yingluck assures ThaiVisa (furzy mouse)

Eurozone exceeds hopes in recovery Financial Times

Roots of Bosnian Protests Lie in Accords of 1995 New York Times

Emerging-world fashions that change with the seasons Mohamed El-Erian, Financial Times

Big Brother is Watching You Watch

European Parliament Committee Says No To TAFTA/TTIP Deal Without Respect For Data Privacy … TechDirt (Deontos). The European Parliament is less powerful than Congress, but at a minimum, this legitimates criticism of the deal by other elected officials.

Snowden stole co-worker’s password, NSA memo alleges CNET. Notice the redefinition of the word “stole.”

Debate: Was Snowden Justified? Former NSA Counsel Stewart Baker vs. Whistleblower Daniel Ellsberg Democracy Now
Obamacare Launch

Obamacare Launch

The Obamacare ‘Bailout’ Conservatives Don’t Want to Talk About Bill Moyers

Still Needed: Obamacare Fix for 20 Million Working People Huffington Post

Obamacare woes pit Democrats against Democrats in liberal states Washington Times

U.S. ambassador nominee gaffes prompt uproar Washington Post

Just How Much Do Republicans Hate Unions? American Prospect

Volkswagen workers reject UAW Politico. This is a really big deal defeat.

FHFA says Fannie and Freddie still take on risky mortgages Law360 (Deontos)

Will US civil liberties survive the Occupy trial? Guardian

A season finale for America’s long-running cable drama Economist

We Need Real Competition, Not a Cable-Internet Monopoly New Yorker. Lambert: “Really? Why not just turn cable into a public utility?”

A Bigger Comcast May Beget More Deals New York Times. NC readers figured that one out already.

State reconsidering crude oil transportation applications Capitol Times

The new Dust Bowl: ‘epochal’ drought hits California’s Central Valley Telegraph

In drought-stricken Central Valley, Obama calls for cooperation Los Angeles Times. Lambert: “Heaven forfend water should be treated as the common pool resource it is [ducks].”

Solitary Confinement in California Prisons: What Pelican Bay Prisoners Weren’t Allowed to Say to Legislators Kevin Gosztola, Firedoglake (Chuck L)

How One Billionaire’s Idea To Give Rich People More Votes Is Already In The Works ThinkProgress. This was most decidedly not a joke.

A return to the old game of second-guessing FT

Feds won’t enforce money-laundering laws against banks doing business with pot stores Sacramento Bee

HSBC, BofA Reach Forced-Insurance Accords, Lawyers Say Bloomberg

Occidental to Re-Evaluates Its Role in Commodities Trading Wall Street Journal. Hahaha, remember Andy Hall, the supposedly astonishingly successful energy trader that had to lead Citigroup? We said the fact that he didn’t start an independent hedge fund and had trouble getting anyone to pick him up was a strong sign that his profits were dependent on exceptional leverage he got at Citi (counterparties allegedly gave his unit terms he would get nowhere else) and concentrated information flows. If Hall was still bringing in big bucks, there would be no conversations about his role.

McClatchy-Marist Poll: American dream seen as out of reach Belleville News-Democrat. “Everybody plays more or less by the same rules: 14%; Different rules for well-connected, people with money.” Although tracking data on this result would be interesting.

“Foreclosure Rebound Pattern”: Foreclosures SUDDENLY Jump 57% in California (And Soar In Much Of The Country) Wolf Richter

Antidote du jour. A little late but still fun:


And a bonus:

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  1. Michael

    Quokkas are some of the loveliest animals you could ever meet. They will approach you and sniff at you without any fear.

    PS love your blog, long time reader but never comment, but those little guys motivated me to.

    1. abynormal

      indeed…nothing like starting the day with warm tears

      “And if we dare to look into those eyes, then we shall feel their suffering in our hearts. More and more people have seen that appeal and felt it in their hearts. All around the world there is an awakening of understanding and compassion, and understanding that reaches out to help the suffering animals in their vanishing homelands. That embraces hungry, sick, and desperate human beings, people who are starving while the fortunate among us have so much more than we need. And if, one by one, we help them, the hurting animals, the desperate humans, then together we shall alleviate so much of the hunger, fear, and pain in the world. Together we can bring change to the world, gradually replacing fear and hatred with compassion and love. Love for all living beings.”
      Jane G.

    2. Chauncey Gardiner

      Took the ferry to Rottnest Island once many years ago when in Perth and biked around the island. Disappointed and surprised that I didn’t see any quokkas. Are they few in numbers or was I just unlucky in my viewing that day? Anyway, it was a beautiful place to spend a Sunday.

      1. psychohistorian

        Thanks for the Rottnest Island memory jog. I was there for a couple of days and was struck by the moaning frogs at night that sounded, shall I say, passionate…..nice memory.

  2. direction

    Open connection between Occupy Oakland and Bosnian uprising–wow! What an article, thank you for posting! Was just speaking to a Bosnian friend last night, here in the states, and he is very excited and hopeful about the uprising that is going on over there. 2 things to note: First off, the academic community wants the press to shift the focus away from the ethnic schism that drove the conflict in the 90s
    and secondly, Tuzla is getting little or no press at all anyway, unlike Kiev. He feels it’s partly because the Clinton name is connected to the Dayton Accords. interesting eh? and of course also because Kiev is a “positive” story about them moving away from “evil russia.” He said the current worker uprising is really exciting because it’s well organized and they are revitalizing organizational structures from the past to take back the factories. I wish I knew more about the specifics.

      1. direction

        Thanks Klassy,
        I should have been more specific myself. I know about the historical background. What I was wanting to know more about was how the organizers are working currently and what their strategy is: techniques for organizing people. My friend is in touch with people over there, and hopefully he will write something about the specifics. I have other organizer friends who say it is unlikely however, as publicizing organizational information can lead to the authorities honing their counter measures more quickly. c’est la vie.

  3. Katniss Everdeen

    RE: VW workers reject UAW

    Are guns the ONLY thing these people care about?

    It’s getting harder and harder to feel any compassion for people who see every issue as a way to take away their guns.

    1. diptherio

      Haven’t read today’s link, but yesterday’s on this same issue highlighted how state republicans were threatening retaliation against the workers if they voted to go union. I think it’s a combination of ideological brain-washing and being cowed by threats. And don’t forget, plenty of the workers voted FOR union representation…don’t want to lump those folks in with the people who voted against.

      1. psychohistorian

        IMO, the VW employees were cowed by the politicians and strong media coverage and still they came closer than I think some thought.

        Sad, but clear evidence of the water in our pot starting to boil….what will us frogs do?

        1. hunkerdown

          Some will evaporate and push past the water. The lucky ones will make it to the other side and no longer bear the dead weight of all that water. The unlucky ones will fall in, or die trying.

    2. abynormal

      “Can anything be imagined more abhorrent to every sentiment of generosity and justice, than the law which arms the rich with the legal right to fix, by assize, the wages of the poor? If this is not slavery, we have forgotten its definition. Strike the right of associating for the sale of labor from the privileges of a freeman, and you may as well bind him to a master, or ascribe him to the soil.”
      William Cullen Bryant

      & now:
      “Organized labor is organized to take control of an asset away from its rightful owners without paying for it. Organized labor is organization of property by those who don’t own it. Organized labor, by driving up the costs of production through coercive means, destroys industries. Organized labor is piracy without the boats and eye patches. Why would anybody want to celebrate organized labor?”
      Douglas Wilson/genre: Religion & Spirituality, Politics, History
      influences: P.G. Wodehouse, H.L. Mencken, C.S. Lewis, G.K. Chesteron

    3. JTFaraday

      I don’t doubt the politicians threw everything they had at it, but that doesn’t mean that’s actually the reason the employees voted against unionization. It seems to me that the reason most of them might do so is fear that if they push too hard they’ll just ship the jobs abroad.

      This is not an irrational fear–I don’t see how you work in manufacturing in the US in 2014 and not think you’re living on borrowed time– but it’s more useful to the liberal pundits and the conservative politicians if everyone else thinks they’re irrational boobs who only get what they have coming to them.

      If the UAW really believes that it can make this work for the employees and not inadvertently undo them, then they should stay there and organize another vote.

      1. bob

        “It seems to me that the reason most of them might do so is fear that if they push too hard they’ll just ship the jobs abroad. ”

        That goes against reason. First, VW was fine with the UAW, and even invited them in. The jobs have ALREADY been shipped overseas, to the USA. VW is german, with a very active union membership in Europe.

        What happened at the BMW plant in SC when 2008 hit? The non-union workers in SC were laid off in favor of keeping the unionized germans working.

        1. JTFaraday

          Don’t even try to tell me it’s “against reason.”

          I suppose you prefer the explanation that the employees are just irrational, and therefore dangerous, gun toting nuts? It’s much more likely that the US will lose many more manufacturing jobs than that the politicians will take away the guns that will, in the future, become the excuse for filling up the for-profit prisons with even more people.

          Those jobs are here today, but what do politics in Germany say tomorrow? If politics in Germany suggest VW should return jobs to the unemployed in Germany, the union in the US becomes a handy excuse, one that also pre-manages the workforce in Germany. ie., “we’re returning, but don’t even think about giving us a hard time.”

          You can’t say for sure what the US employees should strategically do with respect to unionization in manufacturing. Only the ideologues, on both sides, can say for sure. And, for sure, both sides want to dictate the employees.

          “What happened at the BMW plant in SC when 2008 hit? The non-union workers in SC were laid off in favor of keeping the unionized germans working.”

          Unionized Germans. Exactly. So you do understand the dilemma.

          1. JTFaraday

            And that’s without even discussing slave state China, or whatever the next up and coming slave state is supposed to be.

            The only “rational” thing might be pocket your would-be union dues and call it a day. It’s everything else that is an act of faith.

            And honestly, I don’t blame people for not having that faith.

            1. hunkerdown

              European firms like IKEA are manufacturing in the USA because of cheap, pliant labor. Your question may already have a likely answer.

          2. bob

            My mistake.

            “It seems to me that the reason most of them might do so is fear that if they push too hard they’ll just ship the jobs abroad. ”

            No reason, anywhere, check.

            1. bob

              When you’re done with “reason” can some of us have it back for a while? Is there a licensing fee? How did you end up with the monopoly?

      2. Propertius

        I think you’re probably right, JT, but it doesn’t fit with the Fauxgressive mythology that working people (particularly in “flyover country”) are ignorant bumpkins who can’t determine their own futures without guidance from their betters in the “creative class”. Yes, I’m sorry the vote failed but I’m not going to pretend to know why those who voted against the union did so. Perhaps, just perhaps, they might have been partially motivated by the fact that pay and working conditions at the VW plant are already better than at UAW shops in Michigan – which suggests that representation by the UAW might not improve their situation very much. See:

    4. Pwelder

      My contracting company had collective bargaining agreements with several of the skilled trades, and so I’ve had occasion to learn the rules wrt organizing campaigns. Among the big no – no’s for management: You don’t threaten bad things to occur in the event of a union win; and you don’t promise good things contingent on a union defeat.

      Management here may not have been talking directly to the workers, but they sure managed to get their message out. If the NLRB lets this stand, it’s another big change in the rules we played by in the ’80’s and ’90’s.

      1. RanDomino

        The “rules” around what management can’t say aren’t worth the paper they’re written on. You can’t say, “If you unionize, we will do X”. You CAN say, “If you unionize, we’re worried that X might happen”.

        Anyway, like 700 workers voted for the union, and they could easily have a de facto union if they were to think of it- if 40% of the workforce downs tools, the workplace stops. At some places this number can be as low as 10 or 5 percent. Think of even a grocery store- if a single checkout person closes their line, it can clog up the others to the point where customers start to leave. These are the kind of creative tactics that unions which are stuck in the 1950s model will never consider.

        For the rest of us, why not join the IWW today? You can join even if you’re unemployed, retired, on medical leave, self-employed (but don’t have employees) or anyone else so long as you’re a member of the working class (i.e. not in control of hiring/firing of workers, not a cop, and generally not a politician).

        1. montanamaven

          Thanks for the link. According to Bob Fitch in “Solidarity for Sale”, “French unions are severely understaffed; their top officials paid less than the expense accounts o American trade union leaders. French union dues are completely voluntary. Yet this seemingly haphazard system doesn’t stop French workers from regularly pulling off countrywide general strikes whose scope and effect is unimaginable here. ” It’s always about the money and how it corrupts.

          1. hunkerdown

            It’s also about a national-level social identity that doesn’t require continuous suspension of disbelief, isn’t based on individual supremacy, and doesn’t invent arbitrary axes of consumer identity to replace class, isn’t it? When one acts as a member of a population rather than an interest group, many but not all things are possible.

    5. different clue

      The article did not say that the VW carworkers voted based on “guns”. It only noted that anti-unionitic agitaters in high places put up builboards linking UAW to “gun control”. One would have to do detailed interviewing to see what motivated the voting workers. One suspects that Corkers’ and others’ credible threats of extortion and persecution against Volkswagen might have influenced the vote of survival-motivated VW workers.

  4. allcoppedout

    I’m sure one of those ginger cats has migrated to the cardboard box on top our our dishwasher. He isn’t talking yet, but barks food orders at any given opportunity. You have to wonder how we get into such a mess when you see the lovely people around Wounda.

    The Guardian report on global warming probably isn’t right. We have developed an economics that broadly prevents us doing the right things. The relations between carbon and weather remain weak in climate science journals I scan. This is no reason not to engage big green projects now on a global basis, the politics of vested interests remaining the real problem. We have to shift politics back to democracy and get tougher on those perverting it.

    1. JTFaraday

      “I’m sure one of those ginger cats has migrated to the cardboard box on top our our dishwasher.”

      Nope. Not those cats. Those cats hopped the next ferry to Santorini together, (and all of Europe is very envious of their escape).

  5. Paper Mac

    Re: “US blind to barbs in Japan defense plan”

    Anodyne title belies some interesting commentary here, including the following:

    ” The Mainichi Shinbun obtained secret documents of the Defense Ministry (fortunately for them, and the public, the new secrets law is not yet in force to suppress such inconvenient information), which reveal that senior PLA officers had told their Japanese counterparts in May 2010 that they had established the ADIZ in the East China Sea, and that they were moving toward making it public in the future. Moreover, they invited dialogue with the Japan Self-Defense Forces on how the two countries’ overlapping ADIZs might be managed in order to reduce the possibility of mishaps.

    Moreover, the Japanese government was, according to the Mainichi Shinbun, well aware “in early 2013” that “final preparations” for the announcement of the Chinese ADIZ were underway.

    We can safely surmise that if the Japanese government knew the declaration was forthcoming, that the US government, with its vast intelligence agencies, was also aware of it.”

    In other words, all of the hubbub about the Chinese air defense zone was total bullshit intended to achieve domestic Japanese and American/Japanese bilateral policy goals.

    1. psychohistorian

      Japan is a pawn of US empire and is being manipulated to represent US hegemony of the region.

      Dying empire bluster is what dying empires do…..We hope US leaders love their children and don’t launch us into nuclear winter to continue propping up our socially bankrupt class system.

  6. Jim Haygood

    Norway’s central bank punters double down:

    Oeystein Olsen, the governor of Norway’s central bank, said he’s planning to petition the government to allow the world’s biggest wealth fund to cut bond holdings further to help it generate bigger returns.

    Olsen will recommend that the fund cut bond holdings to 20 percent to 25 percent of its portfolio, from the current 35 percent to 40 percent. The investor is also mandated to hold 60 percent in stocks and as much as 5 percent in real estate.


    After five years of glorious stock returns, envious hindsight sets in: ‘if we’d only been 100% in equities, we’d be rich.‘ Such sentiments usually prove to be ill-timed.

    From an MPT (Modern Portfolio Theory) perspective, heavily equity-tilted portfolios take too much risk for each unit of return earned. Although the return of bond-heavy portfolios is lower, they can be leveraged to match the performance of an equity-tilted portfolio, with lower risk. But since leverage is politically unacceptable in public portfolios, managers end up chasing return in riskier, sub-optimal unleveraged portfolios.

    1. Calgacus

      The very idea of a country like Norway having a sovereign wealth fund is ridiculous. Its function is just to squander wealth and prevent it from going to the average person, by gambling and speculating abroad, giving financiers their vig. Rather than using that money for imports, especially for investment in Norway’s economy. At one point during the 2008 crash, they were down $800 billion, an unbelievable sum for such a small country. Michael Hudson and Arno Mong Daastoel have some good articles on these Norwegian follies.

      1. Jim Haygood

        ‘At one point during the 2008 crash, they were down $800 billion, an unbelievable sum for such a small country.’

        Not merely unbelievable, but not even remotely true, to boot . This sh*t is easy to look up:

        ‘At year-end 2008, the total market value of the Government Pension Fund was NOK 2,363.2 billion [USD $363 billion]. This represents an increase of NOK 227.2 billion [$35 billion] since year-end 2007, some of which (NOK 384 billion) [$59 billion] is due to inflow of petroleum revenues. At the same time, the very poor returns on the Fund’s investments reduced the value of the Fund by roughly NOK 663 billion [$102 billion].

        Nice try, though!

        1. scraping_by

          You’ve made the Beardstown Ladies mistake – added both contributions and returns and called it all increase. The reality is that investment loss is loss.

          “This represents an increase of NOK 227.2 billion since year-end 2007, some of which (NOK 384 billion) is due to inflow of petroleum revenues. At the same time, the very poor returns on the Fund’s investments reduced the value of the Fund by roughly NOK 663 billion.”

          Calgacus has it right. Money evaporated in the casino, much of which went into the pockets of the insiders.

          Nice try, though.

        2. Calgacus

          I got the 800 billion figure from Arno Mong Daastoel’s The Petroleum Fund and the LO passiveness. I should have said kronor, which is still an enormous loss. Thanks for the correction (though I doubt many Norwegians said that then. :-) ) And thanks for the kind words, scraping_by.

          As Some Guy, I posted other relevant links from Hudson, Daastoel and Norwegian billionaire Øystein Stray Spetalen here at billyblog a few months ago.

  7. Katniss Everdeen

    RE: One Billionaire’s Idea To Give Rich People More Votes

    “Harvard economics professor Edward L. Glaeser argues that as the rich become richer and secure more political influence, they support policies that make them wealthier at the expense of everyone else. “If the rich can influence political outcomes through lobbying activities or membership in special interest groups, then more inequality could lead to less redistribution rather than more,” he explained in a 2006 paper.”

    Gee, ya think? Ya gotta hand it to those Harvard professors. They think of things that mere non-Harvard mortals could NEVER have come up with.

    Thank gawd they find their way into our government and corporate hierarchies as consistently as they do.

    1. diptherio

      Yeah, this is one of those moments where I want to tear my hair out and scream, “Where’s my Harvard professorship?!?” I made this exact same argument (more of an observation, actually) whilst completing my BA in economics and was almost universally belittled and accused of being overly “normative.” But this guy points it out and suddenly it’s like, profound ‘n stuff.

      Refusing to accept that there exists a feedback mechanism between economic and political power is part and parcel of neo-classical economic training. Such a mechanism does not appear in any neo-classical models of the economy, and therefore does not exist, QED…

      1. psychohistorian

        Exactly! This is why I could never be an economist. They refuse to admit the control of capital is in the hands of the plutocrats at the top of a class system propped up by ongoing inheritance. You might even say that they do it on purpose to keep their jobs as propaganda creators for the puppet masters behind the curtain.

        1. MyLessThanPrimeBeef

          And where propaganda is not enough, they give you…lottery.

          I hope this is not quite true, but apparently, a lot of liberals are just one (small) lottery-win away from becoming conservatives.

          That’s not very re-assuring.

  8. diptherio

    Re: Mclatchy-Marist poll

    The findings underscore the landscape at a time when the economy and the country are being fundamentally changed by waves of globalization and new technology, and as Americans struggle to see a better path forward and their politicians grapple over how to help [the super-wealthy extract even more wealth from the struggling citizenry].

    There, fixed it for ’em.

  9. Chris

    A note to our English friends lamenting our drought.

    The Western Central Valley is a near desert in the rain shadow of the coastal mountains.
    The water that is used to grow crops comes hundreds of miles via canals from the Sacramento/San Joaquin Delta to the north and is in short supply even in the wettest years. Seawater is intruding further inland as water is diverted to the megafarms of the Central Valley via taxpayer funded federal and state water projects.

    The largest landowner in the Central Valley just happens to be a major donor to the Democratic Party.

    “The Center for Investigative Reporting describes Stewart Resnick, the Beverly Hills billionaire owner of Paramount Farms in Kern County, as a “one-man environmental wrecking crew.”

    The powerful agribusiness tycoon has been instrumental in campaigns to eviscerate Endangered Species Act protections for Central Valley Chinook salmon and Delta smelt, to eradicate striped bass in California, and to build the fish-killing peripheral tunnels.

    Yet the wealthy agribusinessman also wears another hat – “environmental leader.” Yes, Resnick serves on the board of directors of Conservation International, a corporate “environmental” NGO, noted for its top-down approach to conservation and involvement with corporate greenwashing throughout the world.

    Cheers, and good luck with your floods.

    1. Antifa

      I’ve seen come maps of what coastlines around the world will look like when the earth is 4C warmer, and the oceans swell by fifteen feet in elevation. The Central Valley will be an inland sea.

      Or could gigantic graphene filters be installed in dams that block the rising ocean, and solar powered pumps send rivers of desalinated, de-isotoped (Fukushima) water flowing into a gigantic agricultural paradise that sits downhill from the ocean? Make that inland sea an inland garden.

      And flood the Mojave Desert with fresh water. And Death Valley. And Baja.

      Fracking is methodically ruining groundwater around the country, so graphene water filtering is going to become kinda vital to just about everyone, especially folks who now heat their homes by lighting the kitchen faucet on fire.

    2. MyLessThanPrimeBeef

      Once again, there is a scarcity problem on top of a distribution problem.

      In this case, the distribution problem just exacerbates the matter, as usual.

  10. Andrew Watts

    RE: Was Snowden Justified? Former NSA Counsel Stewart Baker vs. Whistleblower Daniel Ellsberg

    Anybody else as disturbed as I was during this part of the interview?

    STEWART BAKER: …”That said, the FISA court at that point had utterly disgraced itself. It had forced a bunch of what it turns out are illegal requirements in the name of civil liberties on the FBI and the intelligence community that helped in a very significant way to make it difficult to respond to the news that there were hijackers or there were terrorists in the United States before 9/11. Had it not been for the FISA court’s wrong and extralegal policies, it’s quite possible that the hijackers would have been caught.

    And after 9/11, after it became clear that this was part of the problem, the FISA court insisted on those illegal policies and forced the government to take its first appeal ever to the FISA review court. That suggested that the FISA court was not actually interested in protecting Americans, but had a goal that no one else in government shared, which was to maintain this wall between intelligence and law enforcement.”

    God, I hope that Baker is being facetious because these emboldened assertions are crazy. If they represent the consensus opinion of the NSA or the US intelligence community as a whole we’re in far more trouble than anybody realizes. It appears like the NSA is ‘going Angleton’ on the country in the aftermath of 9/11.

    Nobody in their right mind could possibly think ‘third hop’ mass surveillance would foil any plot. (and it hasn’t) If anything it would waste precious investigative resources on fruitless manhunts. But everything from “we stopped x number of terrorist plots!” to “collect it all!” and their “it’s a Russian/Chinese conspiracy” response to the Snowden revelations while the FBI claimed he acted alone has all the warning patterns of a bunch of paranoid minds at work.

    This is what happens when you go to the dark side. We need to start forcing our spooks to take mandatory vacation days.

    1. sd

      Read the articles by Jeffrey Kaye about IRONMAN and DO5. A joint forces intelligence unit, which in all likelihood included NSA, was actively tracking Al Qaeda and Bin Laden in 2000. The unit was ordered to stop.

      Members of DO5 were never invited to testify to congress about their work. To this day, the information about the very existence do DO5 continues to be ignored.

      1. Andrew Watts

        I liked this a lot better when I thought that they were a bunch of authoritarian opportunists. The torture of thinking “you could’ve done something” concerning the deaths of other people has the capacity to destroy anybody.

        It’s a little known fact that cryptanalytic personnel and hackers alike are prone to suffer from various psychological issues. (ie; nervous disorders, PTSD, etc.) Yardley makes light of this in the American Black Chamber. If any bit of information regarding IRONMAN and DO5 are true than a significant portion of the US intelligence community is carrying a heavy burden. They are also likely to be high ranking officials of the community.

        This could explain a lot of what has happened in the post-9/11 years. Everything the leadership of US intelligence has done from the draconian actions undertaken against whistleblowers, the mass surveillance programs, the drones, and finally the baffling official reaction to the Snowden revelations.

        Both the DNI and Obama administration have done everything in their power to practically cave to the demands of the anti-surveillance crowd. The most recent development being that the NSA is now being forced to go to the FISA court for permission to query their metadata collection.

        Umm, maybe we should demand that all intelligence personnel be furloughed for 60-90 days for every 360 days of service. They’re no good to us or anybody else if they’re broken.

        1. Synopticist

          “I liked this a lot better when I thought that they were a bunch of authoritarian opportunists. ”

          Ha ha. Good point.

    1. psychohistorian

      The economists would tell you it is just more “animal spirits” and keep stirring the pot us frogs are starting to boil in.

    2. financial matters

      The next few years could finally prove to be a good time to buy a house..

      “Out of 110 economists, real estate experts, and investment strategists surveyed in Zillow’s latest Home Value Index, 57 percent said they think institutional investors will work to sell the majority of homes in their portfolios “in the next three to five years.” These investors are largely credited with propping up housing during its recession, helping to keep sales volumes from plummeting too far.”

      “So, there you have it; the banks haven’t been foreclosing because it hasn’t been in their interest to foreclose. Foreclosure sales push down prices which batters balance sheets and scares shareholders. Who wants that? So the game goes on. Only now, the dynamic is changing. Skittish investors are eyeing the exits, QE is winding down, and housing prices have peaked. The recovery has reached its zenith, which is why the bankers want get off on the top floor before the elevator begins its bumpy descent.”


      Would be nice timing to switch to a bottom up strategy rather than our current trickle down..

      What Now?

      February 12, 2014
      By Joe Firestone

      “They can have both job creation by the Government and no national debt. They can also have true universal health care and no national debt. They can also have first class free education, and new infrastructure, and new climate-change and environment friendly new energy foundations, and much else with no debt subject to the limit. When they know these things and when they believe that Democrats, if elected, will provide them with these things, all without needing to raise taxes, then, and perhaps only then, will the Democrats be able to snatch victory from impending defeat.

      Think about it. The three traditional excuses for inaction: the debt, the need for tax increases to fund the new programs, and their not having control of Congress will be gone. So, the Democrats will either have to deliver on their promises about jobs or their mask as the party of the people will be well and truly ripped off for good and all.

      Either way, the rest of us are better off. If they deliver, we’ll have full employment, and if they don’t, then everyone will know that the 99% need a real people’s party. And the Greens will be waiting in the wings, with the best cast of characters this side of the New Deal.”


      And I would throw in forgiveness of predatory student debt as a useful economic stimulus

      1. Jess

        “the need for tax increases to fund the new programs…will be gone”.

        IIRC, Lambert made a similar statement in a post comment a few days ago, namely that under MMT we don’t need taxes to fund programs. If this is true, why are there countless calls on these pages to return to Eisenhower era tax levels, to get rid of the hedge fund carried interest loophole, and make other changes in the tax code to redistribute income and reduce inequality? Because if the taxes collected from the rich are not used to finance government programs that benefit the 99%, if that money doesn’t go to reducing/eliminating student debt, rebuilding infrastructure, funding universal health care and improved K-12 education,etc., then are higher taxes merely confiscation of wealth rather than redistribution of it?

        IOW, if the government can just print all the money it needs for beneficial programs and there is no correlation between how much we tax the rich/corporations and what the government can afford, why tax the rich at all? Why not let them keep all the money they make? Hell, why tax anyone?

        Seriously, can somebody explain this to me because, as my late mother used to say, “I’m confoozed”.

        1. financial matters

          Taxes are mainly used to slow down inflation if too much money is chasing too few goods. (especially at times of full employment) It also can align incentives for investment options.


          Essays in Monetary Theory and Policy: On the Nature of Money (10)
          February 13, 2014
          By A. Clayton Slawson III*


          financial matters
          February 13, 2014 at 12:19 pm
          It seems difficult to channel investment into productive activities rather than financial products. I think changes in tax incentives can be useful here. I thought this was a good comment.

          Against Regressive Taxation
          September 28, 2013
          By Fadhel Kaboub

          Robert Avila | September 29, 2013
          What I cannot figure out is why economists have never made a stronger case for progressive taxation and the graduated income tax. The US became the world’s dominant economy led by a vast array of strong creative corporate enterprises during the period from 1917 through the 1970s when the US had an income tax system that was, by today’s standards, confiscatory at upper income levels. I believe the case can be made that the progressive income tax was a highly successful solution to the agency problem: that the tax system fostered corporate governance that greatly discouraged corporate executives from using their governance position primarily as means of building their personal fortune, that with today’s historically low marginal tax rate every corporate executive has an incentive, in what ever way possible, to transfer as much corporate resources as he or she can into their own personal account and then to invest that money in private equity funds that engage in the same practice of transferring corporate assets in to private holdings.

          Under the highly progressive graduated income tax along with the lower LONG TERM capital gains tax executives had the incentive to build strong viable institutions. At the same time corporate governance could be relaxed enabling executives a great deal creative freedom to act because the incentive to put personal gain ahead of corporate gain was greatly reduced.

          This is not an argument about “unjust” allocation of social resources, or even one in favor of the so called “greed tax”. Rather it is an argument based on aligning incentives with institutional objectives and the efficiency of investments. The highly progressive graduated income tax was a remarkably simple solution to the classic agency problem that strengthened US economic institutions. Without it the incentives of corporate executives in finance and commercial enterprise are continuously compromised.

          1. psychohistorian

            While I don’t disagree with a progressive tax structure, I think that this discussion is missing the real culprit, the capping of wealth.

            You and I didn’t buy our government and reduce the progressive tax structure. Those with inherited wealth did and have been doing so for centuries….and misleading folks with fake economic arguments along the path to get their way.

            IMO, unless and until we limit the accumulation of wealth, world wide (so THEY can’t just move that wealth around to more unenlightened countries), we will continue to have to push back against the progressive nature of a tax system on income.

        2. MyLessThanPrimeBeef

          I would stay close to the idea that the government is like a household and should be like a household, and taxation should not be without representation…representation because you and I must consent to taxation…and if there is raging wage inflation and you and I see no need for taxation, then there is no need for taxation and let wage inflation ride.

          And also keep in mind that money creation SHOULD be with the people spending it into existence, not with the government spending it into existence. A good boss (or master) handles the tough jobs him/herself, and not leave them to the servants.

        3. Katniss Everdeen

          I agree with you, Jess, this is confusing. Every time this topic comes up, it’s a struggle to understand. So this is how I explain it to myself.

          First, accept the fact that the US government can print all the money it needs. It doesn’t need to “borrow” from anyone, and it’s “budget” is not limited to what it can collect in taxes. If the country, democratically, decides that everyone should have healthcare or a free college education, we can afford it. Hard to believe, I know, but it’s true so just accept it.

          Now, as the population grows, more money is needed in circulation because everyone needs some to live and there has to be enough to go around. Kind of like a Monopoly game where money is “fed” into the game $200 at a time each time a player passes GO. The government “feeds” the money in by spending what it needs to spend for what the people decide they want government to provide. Other businesses and jobs grow up around this spending.

          But the government can’t just buy all it wants at any price. So how to decide how much to spend into the economy and where? Two things control, and these two things just happen to be the ONLY mandates of the Federal Reserve which, for now, is the controller of the money supply of the US–FULL EMPLOYMENT AND STABLE PRICES. The definition of full employment is everyone who wants a job has one, and the definition of STABLE prices is ZERO inflation (NOT 2%) or, put another way, my dollar tomorrow has exactly the same purchasing power as it has today.

          So, where do taxes fit in? Well it’s obvious that this system is difficult to keep balanced and sometimes it gets out of whack for any number of reasons. If that happens, if too much money is chasing too few goods which is “inflation,” you have to soak up the extra money through taxation. F Beard once said that taxation DESTROYS money and I didn’t get it at the time, but I think this is what he meant.

          Similarly, if unemployment goes up, the government should take immediate steps to restore full employment, either by creating jobs to benefit the country or favoring industries that produce what the country needs.

          The government’s job, with respect to money, is to provide full employment and a stable dollar, and taxation’s only utility is in service of these mandates.

          1. MyLessThanPrimeBeef

            If the government taxes money from a taxpayer’s pocket and gives it to Military Industrial Company in exchange for the latest drones, how is money destroyed if that money is still in the private sector (with drones moving from the private sector to the public sector)?

        4. hunkerdown

          if that money doesn’t go to reducing/eliminating student debt, rebuilding infrastructure, funding universal health care and improved K-12 education,etc., then are higher taxes merely confiscation of wealth rather than redistribution of it?

          Damn right they are! Wealth is power. If one intends to redistribute power more equitably, one can either take it away from the rich, through taxation, or not, through inflation.

          Why tax anyone?

          Because that’s the difference between a tulip bulb and a currency.

    3. Katniss Everdeen

      Not mentioned in this discussion is the degree to which delinquent/unmade mortgage payments have supported the “consumer.” Four years in suspended foreclosure animation is a long time to go without a shelter expense.

      This issue has been periodically discussed on various financial websites. The effect of having to once again allocate some “disposable” income to “rent” may have a significant, negative effect on consumption, and the riddle of the remarkably “resilient” consumer may finally be solved.

      1. MyLessThanPrimeBeef

        That’s amazing – 4 years without a shelter expense.

        But if you are in Medicaid, and have a little bit of asset, they will get it from you eventually.

  11. psychohistorian

    The Tom Perkins article is saying what I commented yesterday in Links. The iron fist wants to come out of the velvet glove and proclaim, Yes we bought your government and we want to make it transparent that we control it.

    1. MyLessThanPrimeBeef

      We still have the 4th branch of government and, do not ever forget, the most important branch.

      When we forget that political geometry and when we forget the separation of powers (i.e. a lot of those powers, specifically those not given away explicitly with approval, belong to the 4th branch), then it’s game-over.

  12. MyLessThanPrimeBeef

    How to make higher education less expensive or free?

    Teach Corps – young men and women volunteers. Go explore the various states of the American-world. Teach (and learn from), and befriend the natives from Alaska to Florida, from Hawaii to Maine.

    What better way to make a difference?

  13. susan the other

    Steve Keen on Australia’s former auto industry. Toyota was the last mercantilist outpost and it is leaving. Keen talks about the benefits of economies of scale and he seems to address the fallacies of perpetual growth-perpetual profit, whether productive or not. But he doesn’t say what I’d like him to say and that is this: We do not need global trade. Economies of scale are a mirage. It is much more efficient and profitable – not to mention healthier – to capture your own pollution and recycle it locally than to haphazardly shovel it up and barge it off to Asia for reprocessing. Or a secret dumping in the Pacific gyre. Small scale decentralized specialized manufacturing beats the big sweat shop internationals on all the important points. Keep the benefits domestic and clean up the toxics and kindly tell the overlords of international trade to go tell someone else about the joys of hot money. The auto industry model of economics from 1945 to now has been Live to Eat for the few rather than Eat to Live for the planet. And I’ll just note that Australia is very lucky to be getting rid of the auto industry. They should stop driving cars too.

    1. F. Beard

      They should stop driving cars too. sto

      LOL! Australia is a CONTINENT not NYC!

      So, Susan the Overlord, are you willing to bear the RESPONSIBILITY of micromanaging other people’s lives?

      You guys are crazy and there’s only one cure – a Manufacturer’s recall. Or wait! That recall was issued about 2000 years ago but many still reject it.

        1. F. Beard

          To a certain extent, yes. But at least this pot knows it’s blackened and does not pressume to micromanage others, much less an entire continent. And if I were as pure as the driven snow it’s even less likely that I would so pressume.

    2. optimader

      “We do not need global trade.”
      of course we do.

      “Economies of scale are a mirage.”
      Would you rather have several very large rare earth mining/refining operations globally that can afford a sophisticated waste water treatment process, or a bunch of little ones that dump wastewater (china) and move on?

      “It is much more efficient and profitable – not to mention healthier – to capture your own pollution and recycle it…”
      Recycling is a poster child for economy of scale.

      I think your confusing economic ability to remediate pollution with (codified) necessity to remediate pollution. Certainly a foundry that pours 5,000,000 tons/yr can be more efficient and environmentally benign, if mandated, than that the same capacity distributed amongst 1,000 little foundries.
      The unpacked argument should be about a more enlightened perspective of whole cost and in this case environmental externalities. IMO that challenge will only be addressed with a more intelligent and honest class of people being elected into positions of legislative authority (globally).
      Don’t hold your breath on that.

      haphazardly shovel it up and barge it off to Asia for reprocessing.

    3. optimader

      My recollection is that Oz is apprx 85% of the size of the US with a population along the line s of Texas, (is that abt right skippy?)
      If there ever was a country (continent) that the population needs cars, it’s there. The economics of replacing vehicles w/ public transportation would be very challenging.

      Heck, an even more stark example is Iceland. The only trains/rail there that I am aware of are narrow gauge antiques in a museum that were used for pulling freight from the harbor in Reykjavik.

  14. JustAnObserver

    Re: Crowd Funded/Designed Hotel

    Why does this remind me of the old saying –

    Camel = Horse designed by a committee ?

    1. Howard Beale IV

      That’s what a lot of folks said about Multics.

      The problem is that when it came to Multics’s design of OS security, they threw the baby out with the bath water.

      1. Howard Beale IV

        Update: Those who derided what Multics did on the security front threw the baby out with the bath water.

  15. Antifa

    The graphene water filters can be used to clean all the oil out of the Gulf of Macondo. I mean Mexico. Gulf of Mexico. Might even pay for itself in recovered hydrocarbons.

    The sea floor around the “sealed” Macondo well head is shattered, and is going to leak crude for hundreds of years.

      1. optimader

        If it has merit, the 800lb gorilla is BASF and a long list of other catalyst manufacturers, SADARA (ARAMCO & DOW (ie Saudi Arabian Chemical Co.),perhaps Calgon Carbon and a host of other engineered materials companies for the scaleup/production of the grapheme,
        Then pick from the engineering firms usual suspects.

        The possibilities are beyond potable water. Think petroleum refining, ethanol production (potential to push ethanol production into a positive energy balance?), the production of literally an endless variety of petrochemical feedstocks that have a dehydration unit operation (ie anhydrous acid feedstock)…
        endless possibilities if the energy balance provides a fractional advantage over other dehydration unit operations (ie distillation).
        It’s a big world..

  16. jfleni

    RE: We Need Real Competition, Not a Cable-Internet Monopoly

    Great post, especially Mr Wheeler “announcing that he’s flying to London to find out how the British managed to introduce some real competition.” Hop across the channel at the same time to check out how the French did it even better.

    Susan Crawfords book on duopoly failures (for the public, not for plutocrats) might become newly popular, and maybe just maybe we will get the communications infrastructure we deserve.

    1. Howard Beale IV

      Some areas in the country actually have more than two ISP’s-Metro Detroit has three (AT&T, Comcast, Wide Open West).

      When the local ILEC rings my doorbell begging to switch (CenturyLink) I always ask them are they FTTP (Fiber to the premise a la FIOS) or FTTN (Fiber to the node) – needless to say, when I ask that question, they walk away very quickly as they know they’re dealing with someone they can’t bullshit.

  17. Vatch

    Tom Perkins, and his fellow plutocratic commissars, such as John Mack, Steve Schwarzman, Lloyd Blankfein, and the Koch brothers, like to claim that they and their corporations are “job creators”. Lickspittles such as the talking heads at Fox News propagate this myth. In reality:


    Without customers, plutocrats like Perkins would eventually run out of money. Of course, Perkins is a very old billionaire, so he won’t run out of money before he dies. A pity.

    1. psychohistorian

      The pity to me is that he will be passing his unspent money on to those that have been inculcated to think like him.

      IMO, we need a cap on the accumulation of wealth so deluded folks like him and his thoughts about how the world should work are deprecated.

      1. MyLessThanPrimeBeef

        According to my Capitalism 101 textbook, the use of that accumulated wealth can be best allocated, not by one person, but by many, many independent players in a free market.

        How to spend that Mr. Rich Guy’s $1 billion?

        Let the people decide.

        We are not socialists, with central (spending) planning, after all.

        1. MyLessThanPrimeBeef

          Basically, if Money rode into town on Competition, what I am saying is, Money should ride out of town on Competition too.

    2. Howard Beale IV

      One of the reasons why we need Amendment Zero:

      For all readings of laws written, the definition of a citizen will be defined as a member of the biological phylum ‘Homo sapiens sapiens’. and that legal fictions defined as citizens are invalid as they fail the biologic process of creation via meiosis.

    3. Antifa

      In our current plutocratic national structure, a million dollars tends to become two million, then four, then eight. We’re well set up for paper wealth to commit incest in the form of cubed CDO’s, derivative swaps, MBS thingies, and offshore accounts. A billionaire is just a human with some legal claim on a huge pile of paper wealth that grows in spite of itself, like kudzu. When the human eventually dies, some other humans inherit a connection to it, but the billion in paper wealth just grows in size sitting in financial paper markets around the world.

      The only way to lose it is to risk it on some insane venture like manufacturing space vehicles, or launching an airline, or building electric cars, creating salable and usable products, causing consumer demand, which creates jobs. Much safer to hand it all over to professional speculators on Wall Street or in the City, and let them turn it into more paper wealth. What are jobs to a billionaire? Certainly not a guaranteed source of more wealth, not compared to buying politicians and getting free trade treaties fast-tracked through Congress. Not compared to getting the Federal government to make good any and all paper losses. Now that’s easy money.

  18. fresno dan

    A return to the old game of second-guessing FT

    “The Fed and the BoE have the same core problem. Unemployment rates improved faster than expected, amid questions about the nature of unemployment. Normally lower unemployment means upward pressure on wages, and the risk of inflation. But when the economy is at less than capacity while high long-term unemployment may make many unemployable, it is no longer clear that the unemployment rate tells us much.”

    This is something that amazes me with the economic commentariat. “Upward pressure on wages….” Hmmmm… just seems to me that the VAST majority of wage earners are in the bottom 4 quintiles. And those quintiles are stagnant…and have been stagnant for 40 years. Not to mention all the working age men between 25 and 54 not in the labor market anymore. Seriously, when in the last 40 years has there been upward pressure on wages (maybe a little tiny bit in the late 90’s). But for the most part, wage earners have been pounded.

    And its always a funny thing about inflation – watch out for wage inflation (even though there isn’t any), and we won’t count food or gas, cause they go up and down and thats just too hard….but inflation in house prices….nah, house prices going up is good, good, good – how people are suppose to buy the higher priced houses with their stagnant wages is never addressed…. inflation in stock prices….they’re suppose to go up…and up….and up…..don’t know what is suppose to keep them high as the vast majority of people don’t have enough money to even buy a house…but economics is complicated.

    1. fresno dan

      Oh, I know how it works. Give banks more money….or buy their MBSs….and than the banks can lend money to people who really don’t have much money, to buy stuff that remains too expensive with their salaries that are actually less in REAL terms….
      Hmmmmm….I’m missing something. These are really smart guys, and that’s why we’re back to 4.9% unemployment…WHA???? unemployment is still high?
      So, do they know how to fix and choose not to?
      Or, do they not know how to fix it?

    2. MikeNY

      Yes, it’s all terribly complicated. Thank heavens they have all those PhDs!

      But one thing you can be sure of: the moment there is even a *whiff* of wage inflation, the calls for the Fed to tighten will be stentorian. Can’t get behind the curve on inflation, doncha know… bad for bizness.

      And our plutocratic poodle of a Fed will oblige.

  19. Antifa

    To be accurate, Perkins the smug billionaire already has millions of votes to the one vote allocated to mere mortals. All he need do is write the millions of dollars of campaign contributions that will get laws written in just the right way to repay his “political speech” ten times over. Politicians bring back the highest ROI out there. They can be bought legally, everything fair and square.

    The real point of his “outrageous” proposal is that he feels free to put it out there with no fear of being promptly tarred and feathered in the public square. He’s mocking the lot of us in the same way Caligula put forth his horse, Incitatus, as a candidate for the Roman Senate, knowing no one could or would seriously respond, for he held all the cards.

    Such is the apathy of the American public to the outrageous thievery and wholesale purchasing of our entire government by the uber-wealthy that Perkins knows he can say such a patently un-American thing and not instantly be dragged from his bed and flogged in public by a crowd of thousands. I’m sure this is what Andrew Jackson or Samuel Clemens would immediately suggest as a remedy for such arrogance from a puffed up scalliwag, but there was freedom of the press in their day.

    The real victory of aristocrats, plutocrats, fascists, totalitarians, demagogues, TV preachers, fundamentalists, and other con artists is psychological — it’s to get people to internalize the idea that there are inherently nobler people than you, people who deserve first dibs on all wealth, authority, freedom and power even from birth, while you and your neighbors were born to squabble over the leavings of your betters, and that’s just the way it is, forever and ever Amen. This internalization, this mental victory over the masses can perpetuate itself for a long, long time before the long knives, torches and pitchforks come out, and things get sorted on a more equal basis.

    This internalization of wealth and power as the way things should be is what Perkins is selling. He feels safe to do so because he knows we know he holds all the cards.

    Just as Caligula did. Until all at once, he didn’t.

  20. MyLessThanPrimeBeef

    Erupting volcanoes.

    Is it possible that these eruptions cool the planet…for a few years?

    1. psychohistorian

      I can’t remember where I read just such a thought, but it is out there. The problem I see with that happening is that it will encourage more despoliation of our planet and we will pollute ourselves to extinction in some other way……….can you say nuclear?……can you say potable water?

      One planet, indivisible.

      1. psychohistorian

        And despoliation of our planet is the REAL problem I have with Xtianity. Their song and dance about how our precious planet is MAN’s to use up and the Rapture will save the right ones is total BS and belief in that stupidity may have already set our course to extinction.

        1. Antifa

          The core idea is that Himself created this one blue planet on a given day about 60 centuries ago, and He is going to show up one fine morning and shut the whole place down, dispatching everyone and everything as Himself sees fit. This Earth, and everything living on it, is completely secondary to reality. The only thing that’s real around here is His experiment in seeing how many of us can be convinced to love Himself and obey His 10 rules. Nothing else around here has any permanent meaning in this scenario. It’s just a stage setting. Props.

          Which makes any attempt at managing this Petri dish we live in quite pointless. We’re all just waiting for Godot.

        2. optimader

          “Their song and dance about how our precious planet is MAN’s to use up..”
          And the moral imperative to procreate (more true believers) geometrically.

      2. MyLessThanPrimeBeef

        I think if that’s the case, it will mislead people for a few years, until the problem reveals itself again, far more, er, assertively.

    2. Ben Johannson

      If enough particulate matter is thrown into the atmosphere the northern hemisphere might cool for a year or two. Assuming the volcanoes stop erupting, of course.

  21. JerseyJeffersonian

    For some alternative commentary concerning the struggle in Thailand, I would recommend a careful perusal of the posts aggregated at Land Destroyer on this topic.

    There has been generally a paucity of coverage in much of the western media, along with a quite evident tilt in sympathies in the limited (dare I suggest, uh, scripted coverage?) toward Thaksin Shinawatra and his cat’s paw sister, Yingluck – read here Neo-Liberalism rampant – these posts may serve as a valuable corrective to the selective and skewed coverage that the western media have thus far seen fit to vomit forth.

    P.S.: This site presents similarly interesting interpretive journalism on a range of topics. Mental floss is always of value.

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