Links 9/27/14

“Free, white, and twenty one” Language Log

Poor fish harvests more frequent now off California coast PhysOrg

Monsanto GMO wheat contamination discovered in Montana RT

US Hospitals Not Prepared to Dispose Waste from Treating Ebola Patients Counsel & Heal (Deontos)

Riot police deployed after Hong Kong students storm Civic Square outside government HQ South China Morning Post

Europe’s Austerity Zombies Joseph Stiglitz, Project Syndicate

The Scottish Question Has Not Been Answered Foreign Policy

Cameron’s remark about ‘effing Tories’ hints at what he really thinks Guardian (Richard Smith)

U.S. Judge: Citibank May Make Interest Payment on Argentine Bonds Wall Street Journal

Taliban Storm Afghanistan, Beheadings Galore Michael Shedlock


Ukraine Can’t Hide Putin’s Victory Bloomberg. We called this last week.

Germany’s economy goes sour as Putin unnerves nation’s shoppers Telegraph


Iran gives qualified support for airstrikes on Isis Guardian

Facing Militants With Supplies Dwindling, Iraqi Soldiers Took to Phones New York Times (furzy mouse)

ISIS Lieutenant Emerges From Australian Red-Light District New York Times. FYI King’s Cross even ten years ago was extremely tame. Victorian houses with plane trees. Heavily policed. I lived within a five minute walk and the ‘hood was very gentrified (swanky restaurants, for instance). So the headline is verging on clickbait.

Big Brother is Watching You Watch

FBI forces police departments across the US to keep quiet about cellphone spying gear RT

Quest for online security to end in tears Financial Times. Beware of excuses to get any biometric info of yours in a database….although this is going to prove hard to escape in the next 10 years. The big hope in the US is perversely how big companies milk old infrastructure (witness our crappy broadband and being close to 20 years behind the rest of the world in implementing chip cards).

Signaling Post-Snowden Era, New iPhone Locks Out N.S.A. New York Times. Really? I thought we learned that the NSA had trapdoors at the BIOS level, no?


Your employer could be considering a health plan with no hospital benefits PBS (Vatch). Proving the NC observation before the law passed that the result would be costly policies that didn’t cover much.

Why I Hope to Die at 75 Atlantic. Kevinirca:

Ezekiel Emanuel, Rahm’s brother, and one of the architects of Obamacare, says that society would be better off if people died at age 75. “Ezekiel Emanuel is director of the Clinical Bioethics Department at the U.S. National Institutes of Health and heads the Department of Medical Ethics & Health Policy at the University of Pennsylvania.” And oh yes, he does a cost-benefit analysis, determining to his own satisfaction that old people don’t contribute enough to expect more.

Why do I think that that when he hits 75 (he is 57), he will be quietly using his own copious wealth, or his very nice health insurance, to get that new hip and treatment for his prostrate cancer? Because he will, that’s why I think it. He just wants poor people’s parents to die quietly and cheaply. He is an evil hypocrite; a Nazi. I showed the article to an ultra-liberal friend who is 73; the friend said he was “disappointed.” Disappointed? How about scared? Well, my friend is rich and has good health insurance; I guess only the little people need to be scared.

Justice Department tells Ferguson police to stop wearing bracelets Reuters

Mr. Cohan Responds On His Silver Rigging Exposé – Two US National Publications Refused the Story Jesse

Fed Capture Furor

The Secret Recordings of Carmen Segarra American Life (Kim Kaufman)

Secret Fed Tapes Recorded Goldman’s Capital Game Matt Levine, Bloomberg

Why the Fed Is So Wimpy Harvard Business Review

Warren Calls for Hearings on New York Fed Allegations Bloomberg

How Eric Holder Failed the Economy Bloomberg. Wow, Bloomberg comes out and says Holder’s big failure was not going after banksters. And they take up Bill Black’s argument almost verbatim, about how over 1000 executives were prosecuted in the wake of the S&L crisis.

‘Bond King’ Bill Gross Loses Showdown at Firm Wall Street Journal. CalPERS felt compelled to issue a peculiar press release supporting Pimco. It reads as if they were pressured to issue it by Pimco or by legislators or elected officials concerned about harm to the California economy (PIMCO is based in Orange County). However, one informed commentator thinks it simply reflects CalPERS’ sense of self-importance.

Class Warfare

Chicago-area air traffic center fire grounds nearly 1,500 flights, disrupts travel Reuters (barrisj). This may seem an odd place for this item, but it bears out something I have been discussing in private for some time. Given how American have been acculturated not to engage in collective action (and even in those rare occasions when they do, paramilitary policing stomps on it quite effectively), frustrated and desperate individuals who lack an outlet will lash out more and more. One route is shootings, the “going postal” phenomenon that was studied early by Mark Ames. But I expect you’ll see a lot more attacks on infrastructure. Some may just attack the workplace, but it’s not hard to see an individual who sees himself as a victim of larger forces to think of and execute an attack on a fragile node that can bring down a much bigger system.

The Benefits of Economic Expansions Are Increasingly Going to the Richest Americans New York Times. Pavlina makes the Grey Lady! See the underlying chart here. I found it more vivid than the NYT redo.

The Rule of Law is Vastly Under-Priced Cassandra. Today’s must read.

Antidote du jour (Twitter via Lambert):

hiding panda links

And a bonus, a video of corgi and a lamb playing:

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  1. scott

    Where will Ezekiel Emmanuel’s logic go to next? Premature (distressed as Larry Ellison would say) babies? They don’t produce anything either.
    It’s time to re-make “Logan’s Run” with real characters. IMDB it if you’re under 40.

    1. DJG

      And the Zekester is the warm and fuzzy member of the family. Another reminder that this business about the great differences between the two major political parties is mainly angels dancing on pinheads.

      1. wbgonne

        OK, many of us agree that both major parties are hopelessly corrupt. Now what? It seems we are beyond the point of recognizing the problem; now we must respond and a unified, coordinated response seems optimal. Vote Green? Something else? I’m open to ideas for action.

        1. Oregoncharles

          The Green Party:

          I shouldn’t discourage, but voting is only part of the question. The party will happily take voters; but full citizenship needs more than that. There’s endless work to do, and a little money would help, too. (We’re used to pinching pennies, so your money goes a long way at the Green Party.)

          The right reason is the principles and the platform: The Ten Key Values are the short form – the principles.

          But another is that the party already exists. If you’re looking for a coordinated response, an existing organization has big advantages – though, TBF, it also has some baggage.

          Quite a few NC commenters are already Greens – I counted 5 last time this came up.

          1. JerseyJeffersonian

            Make that six. Not registered as such, but voting Green when possible. Ideas & principles line up better. I didn’t leave the Democratic Party, they left me.

            1. Carla

              JerseyJeffersonian, please consider registering Green. If the Dems left you, why stick with them? I used to think I wanted to vote in the Democrat primaries; those dumb Dems convinced me otherwise. I registered Green a few years ago and have never regretted it. When I go to the polls on primary day and ask for a Green ballot, the poll workers often say “What?” Then they scurry to find a supervisor who scares up a Green ballot for me. Meanwhile, anyone around gets to hear somebody asking to vote for Green Party candidates. We have to plant the seeds.

        2. DJG

          Vote Green to disrupt the duopoly. Vote in the primaries, so as to force the parties to offer some choice. Vote in municipal elections, since we spend a great deal at the local level–and turnout for municipal elections is abysmal. And when people go on about not wanting to vote in judges’ races (in some states), you can contradict them. We won’t even go into the Tea Party and its ideas of returning to indirect election of U.S. senators. I believe that elections do matter, but in the U.S., turnout is so low that we are guaranteeing their lack of success in producing an end to stagnation or even incremental changes.

          1. Kurt Sperry

            What could possibly be a more fortuitous circumstance for people trying to foment change than low voter turnout? A small energized group of committed voters can make all sorts of trouble in that situation. If voter turnout gets below, what maybe 20-30%, we can take over the freaking country with a little hard work.

            And yes I love the Green Party and its platform, it ain’t perfect but it’s pretty darn good.

        3. Oregoncharles

          The Green Party: The principles and the platform are on the site – more than one link will block my post.

          Not to be discouraging, but there’s more than voting involved in full citizenship. The party runs on volunteers, and there’s endless work to be done; a little money would help, too. (The Oregon party, at least, limits donations to $1000 – not that we get many of those.)

          There are already a lot of Greens on NC – last time it came up, 5 chimed in.

          The principles are the main reason for joining, but if you want “a unified, coordinated response,” it helps to start with an established organization.

        4. different clue

          Different theory-action grouploads of people should do their own different things. People will do best the thing they believe in the most. Over time, more successful approaches will win joiners leaving from less successful approaches.

    2. kareninca

      His name is now a verb. “Zeked.”
      “The State has determined that you fail your cost-benefit analysis, old/young/Down’s person, so you shall be Zeked. Any estate you may have amassed, will be clawed back to pay for, among other things, your euthanization “medication.””

    1. What a brew!

      Some meals Ray must put on! Didn’t know she is a cannibal and canis-bal.

      I’d be inspired too by such repasts.

  2. Bruce Post

    OMG, what is it with the Emanuel family?

    A couple of thoughts:

    1. Here in Vermont, not far from where I reside, John Bland, M.D., lived. He wrote the book: Live Long, Die Fast: Playing the Aging Game to Win. This was written about the book and Bland:

    “‘This specter of decrepitude, to live with no awareness of family, friends or the environment, is our worst nightmare,” he wrote in the forward to his book. “Such an end is not a necessary evil–it can be prevented by using all we know about aging.”

    The problem is that the elderly are expected to grow decrepit, to withdraw from society, to become inactive, Bland says. But they shouldn’t succumb to those expectations.”

    Here is a link to a memorial to him: It is a testament to wisdom, something Ezekiel Emanuel seems to lack.

    2. Regarding wisdom, I have a friend who taught gerontology at Berkeley years ago. He once gave each of his students at 3×5 card and asked them to write a one word reaction to the term “old age”. The responses were: death, loneliness, illness, disease, unhappiness, etc. The one Asian student in his class wrote the word “respect.” Something to ponder there.

      1. MyLessThanPrimeBeef

        And moral values are relative, or in the below example, technology dependent.

        If one day, we could make vegetables out of pebbles, it would be immoral to kill plants.

        1. psychohistorian

          Wait a minute there. What about the “morality” of making vegetables out of pebbles?

          I posit we don’t know enough to assign a hierarchy or even clear value classes, (if such exists), to any collection of matter.

          That said, the home grown beans that are in the bunch of food that I have to throw out now because they just got caught in the Foster Farms/Costco chicken strip recall are not happy….and neither am I. The further crapification of our food supply is not something I look forward to.

          1. MyLessThanPrimeBeef

            Well, you have a good point.

            When we can make pebbles out of atoms, then we shall condemn that as well.

            One baby step at a time.

            1. MyLessThanPrimeBeef

              For more moral relativity, consider this: already in baseball, a post-Tommy-John surgery pitcher can throw harder than before.

              If one day, medicine can make a cut victim’s skin prettier, younger and healthier, would cutting someone’s skin non-lethally a crime?

              If technology can bring the dead back alive, younger and healthier, how do we modify our laws?

    1. HotFlash

      Indeed! A friend was being taught in nursing school about importance of verifying age of patient. His teacher warned that WASPy types, esp women, tend to say they are younger than they are, but Asians often say they are older.

      1. abynormal

        NoKid’n :-/

        Said the little boy, “Sometimes I drop my spoon.”
        Said the old man, “I do that too.”
        The little boy whispered, “I wet my pants.”
        I do that too,” laughed the little old man.
        Said the little boy, “I often cry.”
        The old man nodded, “So do I.”
        But worst of all,” said the boy, “it seems
        Grown-ups don’t pay attention to me.”
        And he felt the warmth of a wrinkled old hand.
        I know what you mean,” said the little old man.”
        Shel Silverstein

      2. MyLessThanPrimeBeef

        Perhaps that’s, partly, due to how age is counted.

        You are one year old, the day you are born*…not after 12 months.

        Perhaps for the time served in the womb…making the idea of abortion problematic for Asian Buddhists.

        1. HotFlash

          Interesting you should say that. Until 1999, abortion was legal in Japan, but birth control was illegal.
          Oral contraceptives, although legal, are apparently still not well accepted; this article also notes that some Buddhist temples cash in on abortions.

          This western lady living in Japan finds that condoms are not so much used in Japan as in the West (and smaller that Western ones, so she says)

          True about the ages, in Japanese tradition you are one year old at birth, for ‘time served’, and one year older each new year — like racehorses.

    2. jrs

      I’m a little more sympathetic to the Emanuel article. No I don’t think as public policy people should be denied all medical care at 75 (although it is often argued too much is spent on futile end of life care, what do people think of that? Although personally that is not really my experience, as they’ll push to have one taken off life support if the prognosis is dire. I sometimes suspect the morphine then kills one). And he’s a public policy wonk so … he can’t be interpreted as just a private citizen with opinions.

      Everyone in my family was quite decrepit by the time they went, by the time they went frankly they usual wanted to die and SAID AS MUCH. It’s pretty depressing to witness old loved ones say they want to die but maybe it’s part of the life process? But yes it was later than 75. Alzheimers runs in the family, none were really fully themselves mentally by the time they went, some worse than others (some locked for years with out of their rocker senile people in Alzheimers wards – those places being the stuff of nightmares). Some had tried to be health conscious etc. in those cases it DID NOT prevent Alzheimers (though I think knowledge of nutrition and stuff is still pretty primitive so they may not have been on the right track even in trying to be.)

      1. abynormal

        [THEY] “said as much”…not the oligarchy’s.

        “Washing one’s hands of the conflict between the powerful and the powerless means to side with the powerful, not to be neutral. ”
        Paulo Freire

      2. Yves Smith Post author

        It is not just genes. There is a lot that can be done to reduce the effects of aging, but there’s no money in the best remedy, so it isn’t widely publicized.

        Weight train regularly.

        A study of people in their 80s found that having them weight train three times a week lowered their biological markers related to aging by decades.

        Similarly, one of my former doctors was an endocrinologist who eventually converted his entire practice to anti-aging (which involved giving patients human growth hormone, an approach I am not keen about. Wide-spread administration of HgH to healthy people is new, which means there is no data on using it for decades in the relevant population. I suspect HgH = cancer futures).

        Said doctor went to a conference on anti-aging. One presenter asked the crowd (all MDs): “If you were given a single biological marker that would best predict biological age, as opposed to physical age, what would it be?” They were given a list of 20 to choose from, stuff like blood pressure, resting pulse, fasting glucose levels, various hormonal measures.

        The best predictor? Strength. The next best predictor? Muscle mass.

        So one of the reasons older people are getting decrepit is the lack of routine physical activity. And I don’t just mean walking. Women used to have to beat rugs and churn butter. My great grandmother, who lived to be 96, was skeptical of the wringer washer her kids gave her and kept wringing clothes out by hand.

        Now go do your bench presses.

    3. DJG

      Death is a cultural issue. I’m reminded of that constantly as I travel through Italy, shopping in stores run by people in their eighties. Besides the elderly getting respect outside the USA, work gets more respect in many countries. Here, a job is something to endure and then retire from. Then what do you do? Very few people live the lives of the elderly in the travel ads.

    4. trish

      my reaction to the ezekial exhortation – what self-absorbtion. All-about-me, self-applauding blather.
      nothing really new or interesting much less thought-provoking- should have remained at his family dinner table.
      and rife with assumptions based on his own experience insulated in/byhis particular social/income class.

      ie this quote-
      “Americans seem to be obsessed with exercising, doing mental puzzles, consuming various juice and protein concoctions, sticking to strict diets, and popping vitamins and supplements, all in a valiant effort to cheat death and prolong life as long as possible.”

      Well, some americans are just trying to get by. They aren’t busy climbing Kilimanjaro, chasing the fountain of youth, they’re fighting uphill battles to get things like adequate health care, poverty, chasing crises, facing family griefs. and that includes millions of elderly.

      a couple more-
      “At age 75 we reach that unique, albeit somewhat arbitrarily chosen, moment when we have lived a rich and complete life, and have hopefully imparted the right memories to our children.” what utter presumption!

      “our older years are not of high quality.” There are enough a substantial number of older people whose whole lives are “not of high quality.”

      This arrogant “sage” decrees what others should think, feel, find “desirable” and worthwhile, how they should act about things deeply personal not to mention complicated.
      and what presumption: “At age 75 we reach that unique, albeit somewhat arbitrarily chosen, moment when we have lived a rich and complete life, and have hopefully imparted the right memories to our children.

      1. jrs

        Also being health conscious isn’t necessarily about old age, it’s about the here and now, for instance not wanting to feel bad because you’ve dumped a bunch of weird stuff your body has no idea how to handle masquerading as food in your system in your last meal (uh that’s your last meal not your Last Meal).

      2. JDM

        my reaction to the ezekial exhortation…

        My own reaction: why wait, Ezekiel? Hurry up, and don’t let the coffin lid hit you on the way out. Leave some room for the rest of us oldsters, your elders, who think you’re full of shit.

    5. H. Alexander Ivey

      “OMG, what is it with the Emanuel family?”

      Nothing unusual for a rich white guy in the USA I would say… As Yves noted, he and his family are not need 75 years of age – except his father (mother too?), who clearly shows the Emanuel family ethic – work until you drop. Oh, but “work” to them is play to most others, the joy of too much money! No need to really worry about a boss, or making the rent, and paying the bills on time… [apologies for the ad hominem aspect here, but Emanuel used himself and his family as examples.]

  3. ambrit

    The South China Morning Post now has a paywall. Am I delusional and they always had this? I’ve never encountered this feature before. (As for the five “free” articles a month; I can burn through that at one go. I jump around a lot on interesting sites.)

  4. Antifa

    “US hospitals not ready for Ebola waste??”

    How can that be in a free market? These hospitals are all corporations, aren’t they? Which gives them the divine right to just toss their waste out on the curb. This is the land of the free, where any corporate mess found in the public commons is the taxpayer’s problem.

    What have Jamie Dimon, Lloyd Blankfein, and thousands of greedy investment bankers been trying to teach us these past seven years except this — “If you can get away with it, it’s perfectly ethical.”

    Do what the Koch brothers do with all their petcoke, and create mountains of biological waste all over the country. It’s not a hospital’s fault if the community they operate in can’t run a clean city.

    Why do these waste hauling companies hate America?

    1. MyLessThanPrimeBeef

      Free market.

      The edifice of a neoliberal ‘Free’ Market is built on the foundation of wage slaves.

      As any good mason knows, the more wage slaves you have, the stronger the mansion.

  5. JGordon

    Just saw an article about a beheading in Oklahoma. Holy crap but that is awful way to go. But actually, on further reading I discovered that attacks with knives and other sharp objects are actually pretty common in America. We seriously need to implement draconian legislation against everyone that bans all sharp things, so that people can be safe. This proposal will surely pass easily, since only abnormal whose opinions don’t really matter anyway will be against increasing safety.

    1. MyLessThanPrimeBeef

      It varies, depending on the culture, how a condemned prefers his method of exiting the world.

      In the West, probably,

      1. with a gun,
      2 a rope
      and lastly, guillotine/beheading.

      By the way, as mentioned before, we need to child-proof knives as well as guns.

    2. diptherio

      Question: How is it that a rampaging maniac is shot twice and in stable condition while Michael Brown and countless others get an entire clip unloaded into them despite being unarmed and not having recently beheaded anyone?

      Maybe we should start replacing the police with reserve sherrif’s deputies—apparently they get the good training :-/

  6. afisher

    Stericycle refused to take biohazard waste for decontamination via Eboli contaminated. HUH? That is exactly what they were hired to do and according to their websites they do indeed use Autoclaves. It is too far back – but wasn’t the main reason that most hospitals began outsourcing the decontamination of biohazard waste was volume via HIV-Aids in the 80’s. This company was formed in 1989.

    Keeping the data and testing as required by the FDA is a real PIA and lots of hospitals were more than happy to outsource this activity – and now the outsourcing company is saying – we aren’t prepared.

    1. RWood

      I suggest the hesitancy to accept such potent waste involves their concern about this:
      “Some may just attack the workplace, but it’s not hard to see an individual who sees himself as a victim of larger forces to think of and execute an attack on a fragile node that can bring down a much bigger system. “

  7. abynormal

    how be it??
    “The government still has no clue as to how the wheat got in the field, and direct links to Monsanto could not be traced, so the agricultural giant will not face any penalties or disciplinary action.”

    “Genetically-modified wheat isn’t legally approved anywhere in the world, and international buyers threatened to boycott US wheat if the product was introduced.”

    “We are in the process now of informing our international wheat buyers,” Alan Tracy, president of US Wheat Associates, said in a statement. ***“We do not expect any disruption in sales.”***

    i hear my favorite LIAR song at 90 decibels

    When the U.S. Animal Plant Health Inspection Service revealed the Oregon genetically modified wheat discovery, Japan immediately canceled plans to buy 25,000 tons of white wheat from the Pacific Northwest. South Korea did the same, as major wheat states like Montana and North Dakota watched nervously.

    Montana wheat sales totaled $1.7 billion in 2012 and 80 percent of that wheat sold to foreign buyers. Japan and South Korea were Montana’s biggest customers, according to the state Wheat and Barley Committee.

    “USDA has approved more than 70 experimental trials of GE wheat in Montana,” Hubbard said. “These trials included not just the Roundup Ready trait found in Oregon, but other traits as well — many of which are identified as trade secrets, so the agriculture community wouldn’t even know what to look for [or where “cloak of secrecy”]. We know that if any of these traits escaped and currently exist in Montana’s wheat seed, crops, and the environment, they are unapproved traits that are rejected by export customers, and therefore a threat to Montana’s agricultural economy.”

    1. diptherio

      Going a little deeper. MSU was studying the modified wheat. Obviously some of the modified wheat somehow pollinated wheat in somebody else’s field. This result is practicably inevitable unless they were very careful with their quarantining of the experimental wheat.

      Normally, self-pollination occurs, which means wheat plants fertilize themselves with their own pollen before flowers even open. Nevertheless – depending on genotype and climatic conditions – cross-pollination with other wheat plants is possible. It usually occurs at a rate of approximately one to two percent. The rate can increase up to 9.7 percent when weather conditions are dry and warm. [emphasis added]

      If they were, on the other hand, growing their test crop in an open field around Bozeman (where MSU is located) they would be literally surrounded by other wheat fields. Wheat Montana, our largest local grain producer (and bakery), has their fields in Three Forks, in the Bozeman area. And “dry and warm” is a pretty good description of our weather lately….

      So, putting on my tinfoil hat, I’d say that this was intentional. Once the patented genes have become reasonably widespread through natural cross-pollination processes, Monsanto will be able to charge everyone for their wheat seed, even if they’re not buying it from Monsanto:

      June 10 (Reuters) – Monsanto Co. on Monday won another round in a legal battle with U.S. organic growers as an appeals court threw out the growers’ efforts to stop the company from suing farmers if traces of its patented biotech genes are found in crops.

      They’ll present the presence of their patented genes as a fiat accompli and then proceed to extract rents from everyone. Check and mate…

      1. Banger

        Not quite mate just yet. This will spur organic growers to grow different grains and give us time to undermine Monsanto and the inJustice system in the USA. Like the political system there is virtually no possibility of real justice to be dispensed under the current system so it! also! needs to be undermine in every way possible.

      2. ambrit

        I’d say it’s way past the time for the organic growers to make common cause with the ‘preppers.’
        The Narcos use armed guards to protect their cannabis plantations in the wilderness areas of the West. Probably going to cross pollinate with the organic farming community pretty soon.

      3. trish

        charge everyone for their wheat seed and sue farmers whose fields they inadvertently contaminate. and the courts back them. it’s unbelievable.

    2. just me

      Can/will Japan keep excluding GM wheat? With secret trade agreements being made?

      I’m still stuck on what I heard at the Moment of Truth panel in New Zealand… Greenwald, Assange, Snowden, and Kim Dotcom’s lawyer Bob Amsterdam. Amsterdam was talking about the TransPacific Partnership Agreement and others like it, and how the negotiations are conducted. I think I have the sequence right: Corporations write the law, use the governments to enact the agreements, the agreements make the lesser-equal countries kowtow to the more-equal country’s law (US) (make them an offer they can’t refuse), and corporations can then sic US law enforcement on transgressors. Not so palatable to you and me, so it’ll all be secret from us for years. So, no accountability, just mindless (well, greedy corporate-directed) law enforcement globally, under the name of the United States, so you and me except you and me.

      The town hall was in New Zealand and Amsterdam straight out called NZ Prime Minister John Key a traitor for how he had sold out New Zealand’s citizens’ rights secretly. (I can’t tell where corporations leave off and the NSA begins in international law.)

      Here’s that part of the town hall so you can check my summary. Amsterdam starts here in the youtube … and the transcript is here . Apologies for the long quote, but this is the section I’m referring to:

      Bob Amsterdam, international lawyer: So, take it from a Canadian to tell you about free trade. A guy whose country now has foreign ownership up to almost 80%. A guy whose country and his countrymen, 36% of them, believe will become a part of the United States within 25 years. The Transpacific Partnership is an arrangement that will take from you your sovereignty in a very powerful and personal way, and it will do it through the same kind of stealth tactics we’ve been hearing from Glenn and the other panelists. Because American trade policy is manufactured by special interests, and when I mean it’s manufactured by special interests, I mean that for instance in respect to intellectual property, it is actually drafted by the Motion Picture Association itself. It is then handed to the U.S. trade representative, who gets together with the RIAA and other interest groups and works out what the trade strategy is going to be. They then engage in negotiations, and if a country that is a trading partner of the United States does not behave according to U.S. standards of intellectual property protection, for instance, a Section 301 listing can be made which impacts their ability to continue to work with the United States. It is a coercive form of listing which has forced many countries, including Sweden and European countries, to aggressively change their IP laws and other cultural-related laws to allow them to continue the type of access they believe they need to the U.S. market.

      Then – and this is somewhat new – once an agreement is reached, and these agreements generally contain language based on largely U.S. norms, once an agreement is reached and your sovereign nation says, “Fine, we’re going to agree with you, United States,” there’s another process, and this process is called the certification process. And by that I mean that New Zealand, in this case of the TPPA, would actually give up its own rights to certify compliance. That right has been ceded back to the U.S. government, which
      under this new congressional legislation essentially allows the president of the United States to determine if New Zealand has actually amended its laws in keeping with the agreement, and if New Zealand hasn’t, then that agreement will not come into force.

      So in the case of Peru, for instance, we find that the U.S. government actually drafted the Peruvian legislation to allow them to enter into a trade agreement with the United States.

      Now, the power of these trade agreements to impact your life directly is very strong, especially when you’re in a country that is marginal to the world system. Now that may be news to John Key, who is a currency trader and gets high fives with Barack Obama, but for the rest of us who have a globe, we recognize…


      …we recognize that…


      …in fact China is not quaking in its boots,


      So the impact means that if you’re a trader like John, you have a limited number of chips to give up. And I am going to make an argument here tonight to you, and I am going to say that John, with his limited pile of chips, has begun improvising. And I am going to say that one of the chips he’s begun to give up is your rule of law.


      Now fortunately I’m not alone in saying that, because I don’t like as a Canadian to come into another Commonwealth country and, you know, absolutely despoil their politicians and their laws, but I do read what other lawyers say, and the Law Society of New Zealand has been very strong in terms of the Key government and in terms of how the Key government behaved in respect to the spy bill, so strong that they went to the United Nations to complain. That should be warning all of you, that should be worrying all of
      you, that your law society felt it had to take that step. And what it complains of is the ways in which the government is using emergency-type or speedy powers to pass legislation.

      …then he ties it in with the magic word “terrorism”…

      Our governments are trying to alienate us from each other, and they are using terror –


      They are using terror to invade our homes, to invade our internet accounts, and to engage in mass surveillance that is violative of our most basic constitutional rights.


      Because what they have done is they’ve made our lives more dangerous. Because there are gangs of men who kidnap and murder and behave like criminals but our governments won’t call them criminals. Our governments are elevating them and in some ways actually empowering them to frighten us, and this is something we need to be extraordinarily cautious about in our society. And one of the ways governments do that is through the excessive use of force. I have even heard that in some countries, on something as inane as a copyright case, they will launch armed attacks on people’s homes.

      [laughter, applause]

      Now, in this global war on culture that has been launched by the internet industries of the United States on all of us, I’m pleased to say I represent one of the first victims, one of the major victims, Kim Dotcom, in an extradition brought to you by the Motion Picture Association of America in conjunction with Warner Brothers.


      In fact you should be aware that his indictment was actually brought to the DOJ, not the other way around. And this is something to be aware of in respect to the Transpacific Partnership Agreement, because it empowers big business in a massive way. Because you see all those businesses that are talking to the trade representative, they’re very smart and they’re very well funded, and they’ve agreed amongst themselves in all of these countries that they need secrecy so we don’t get pissed off. So they’ve given that to themselves. They have agreed to negotiate in secret and keep their documents secret for four years. Now I ask you, in a democracy involving your most basic economic and sociopolitical needs, is that really how these critical trade agreements should be negotiated?

      [Audience in unison: “No”]

      But this is what your government has agreed to. This is how these negotiations are already taking place. So this issue that Julian has spoken about, which is the U.S. extraterritorially legislating, occurs in the trade agreement, but it also occurs in many of the new conventions internationally on legal issues that have come out as well, and there is this export of American law and the militarization of justice that has occurred…

      1. Yves Smith Post author

        We reported a couple of days ago that the TPP is officially dead. Japan even said they are not scheduling future talks. They’ve made it clear the US needs to change its position in a major way. They aren’t willing to participate in more sessions where the US refuses to negotiate.

        This is really unheard of, BTW.

        1. ambrit

          The Japanese are kicking over the traces all over the place recently. They did start the process of military “modernization” and are contemplating restoring their Army. What are the chances that they are secretly exploring building nuclear weapons to counter both China and America? They have the infrastructure to do it. The fissile materials too. Godzilla always did have a love hate relationship with dai Nippon.

  8. Richard

    On my father’s 90th birthday he shared a bit of learning with my brothers and I. “When I turned 80 I thought my life was over, but my eighties turned out to be the best years of my life.” He was the recipient of some nearly miraculous medical care at Stanford and spent the last decade of his life sharing his wisdom and counseling younger people on living life well. A much loved, admired, and respected man. The world would have been a poorer place for hundreds of people had he departed at 75.

    How sad for Ezekiel Emanuel to have such a limited vision of life, people, and society.

      1. wbgonne

        Al least in this instance, we have the Unified Theory of Neoliberalism: because markets go die. When you are old and your economic utility ends you are worse than useless, you are an embarrasment and a financial burden, so go do the right thing already. Real humanitarians, those neoliberals.

      2. Jess

        Don’t forget sleazy brother #3, one of the co-heads of William Morris Endeavor and was the inspiration for the character of Ari Gold in ENTOURAGE.

    1. craazyman

      Sophocles wrote Oedipus Rex at age 90. I think that Pythagorus was 117 when he discovered that his age was the square root of the first 9 years of his life squared plus the second 6 years squared. He reasoned that he was really only about 12 years old plus a few months — based on the theorem. What difference does it make as long as you can still think like that! If anybody lives beyond the mental age of 28 they’ve lived too long.

      1. craazyman

        ooops id did the math wrong in my head. it should be just less than 11. i was thinking 12 jjust to make it easy like it used to be i n 8th ggrade See, he just got younger due to a math mistake! You can go backwards just by screwing up. What luck!

    2. JTFaraday

      “When I turned 80 I thought my life was over, but my eighties turned out to be the best years of my life.”

      Oh– …thank goodness! :)

  9. Brindle

    re: Fed Capture Furor

    Reuters article displays a concern the rubes might start using their brains a bit, not a concern over the actual content of the tapes:

    — Political interest in the recordings could feed suspicion among Americans that little has changed on Wall Street since bank regulators failed to identify and stop the risk-taking that led to the 2007-2009 financial crisis and deep U.S. recession.—

    Senator Sherrod Brown goes for the weak sauce of “cozy” to describe the corruption:

    “For too long, too many financial regulators have been too cozy towards the very industry that they are meant to police.”

    1. fresnodan

      “Silva had been in the room with Geithner in September 2008 during a seminal moment of the financial crisis. Shares in a large money market fund – the Reserve Primary Fund – had fallen below the standard price of $1, “breaking the buck” and threatening to touch off a run by investors. The investment firm Lehman Brothers had entered bankruptcy, and the financial system appeared in danger of collapse.

      In Segarra’s recordings, Silva tells his team how, at least initially, no one in the war room at the New York Fed knew how to respond. He went into the bathroom, sick to his stomach, and vomited”
      With everything I have read about the FED and Goldman, I’ve been barfing so much I’ve lost enough weight I could be a supermodel…..except for the fact that I’m stone ugly, but weight wise, I’m good to go. Now, does Obamacare cover plastic surgery??? – ah yes, the bronze plan allows for someone with a steel mallet to “reshape” your features.
      Goodbye everybody, I’m off to the world of high fashion.

      1. just me

        Re barfing — the economy goes poof and they all throw up? Hank Paulson did the same thing, but he says it was an act:

        A 6ft2 former American football prodigy nicknamed “the hammer”, Paulson looks anything but vulnerable. But he admits that the sheer scale of the crisis took a physical toll. He describes how dramatic symptoms of his own fatigue helped to energise members of Congress to approve his $700bn banking bail-out package.

        As contentious talks stretched into the night on Capitol Hill, Paulson writes: “Exhausted, I went back to the small office I was using and had a bout of the dry heaves in front of [Republican senator] Judd Gregg. I wasn’t that sick, but I made a lot of noise, which seemed to galvanise [Democrat] Rahm Emanuel.”

        Plus, same article, I cannot read this part straight:

        Paulson clearly shared every bit of his boss, George Bush’s, faith in religion. On another occasion, Paulson stepped out of a crisis meeting with a jolt of fear rising up inside him and called his wife, Wendy, worrying that everyone was looking to him for answers which he didn’t have.

        “‘You needn’t be afraid,’ Wendy said. ‘Your job is to reflect God, Infinite Mind, and you can rely on Him.'” She went on to quote from the second book of Timothy (“for God hath not given us the spirit of fear, but of power, and of love, and of a sound mind”) as reassurance.

        (Silva, the first barfer, was then Timothy Geithner’s chief of staff at the Fed.) (I don’t know, I’m getting a picture. Blankfein said what?)

      2. Kim Kaufman

        I think Hank Paulson wrote that he vomited also. I’m not sure what this says about either of these Masters of the Universe.

        1. sd

          It’s supposed to imply they have feelings. Which they don’t. All it really means is they had severe acid reflux due to drinking too much coffee all because they saw staying up late as making them look important.

    2. just me

      In the Bloomberg article linked above, Matt Levine focuses on the hall of mirrors Goldman-Santander deal, which is way over my head, though I notice he skipped over the Fed not objecting clause and why Goldman put that in. But when I was listening to the program this morning, my moment of Orwell was the conflict-of-interest policy. Goldman has one or it hasn’t? Segarra says no, there’s nothing here quacking like a duck even, not even enough feathers to make something that looks like a duck. And then:

      Jake Bernstein During her examination, Carmen asked Goldman’s head of conflicts if their policy had a definition of what a conflict is. And Goldman’s head of conflicts answered:

      Woman No.

      Carmen Segarra Ok.

      Jake Bernstein That’s right. According to the person in charge of evaluating conflicts of interest at Goldman Sachs, the firm’s policy did not have a definition of what constituted a conflict. This was just one detail in a stack of evidence Carmen collected showing that Goldman Sachs lacked a proper policy.

      There was the meeting in November, where Fed examiners asked Goldman for the conflicts of interest policy and Goldman told them one didn’t exist.

      Did you hear what I heard? Goldman has no conflicts of interest policy, they say they have no policy, and yet they have an office and a head of an office that evaluates conflicts of interest, which, btw, its head tells us, has no definition. Does this remind you of nothing-backed, I mean mortgage-backed securities, and Eric Schneiderman’s mortgage task force (full name Residential Mortgage-Backed Securities Working Group) with “no office, no phones, no staff and no executive director”? Like, remember in 2001 when astronaut Dave goes through the star door and gapes, “the stars, it’s full of stars”? We keep going through these endless doors and gaping it’s empty, it’s full of nothing.

      Back to Levine discussing the Santander-Goldman deal and what did it really mean:

      It’s silly to get hung up on whether this made Santander “appear healthier than it might actually be,” or whether it “artificially” enhanced Santander’s capital.9 There is no actual health. There is no natural capital. These are all abstract, artificial constructs, and regulators just get to decide what should count as capital. I think Santander’s exchangeables should have counted as capital with or without the Goldman window-dressing. You might think they shouldn’t have counted either way. The Spanish regulators counted them with the dressing but not without. None of this is real or natural. It’s just a game, and there are rules, and the regulators set them, and then the banks get to play.

      So there. I mean not there.

  10. JohnnyGL

    Yves, I went through King’s Cross 5 years ago and there was pretty much nothing red-lighty about it. Sort of like what used to be “Hell’s Kitchen” in NYC.

    1. John Jones

      Well there is a lot of strip joints and street walking prostitutes and brothels. Plus as far as I know a lot of the clubs bars strip joints etc are owned by the underworld which pushes drugs there along with bikies.

      1. Yves Smith Post author

        Strip clubs are pretty common all over the world. There are a lot of drugs sold in Kings Cross but it’s all done off the street.

        I’m not a shrinking violet, but it was uncomfortable being a woman in Times Square before it was cleaned up. You’d get oogled by creepy men. It was clear the only women who were welcome there were the ones for sale. By contrast, I was never uncomfortable in Kings Cross, even the rare times when I went there at 3 AM. I never heard an Australian woman express reservations about going there either.

        The prostitutes are pretty tame compared to the sort that hang out on 10th Avenue in NYC. Not as scantily attired, not aggressive, and they don’t look like they are fogged out or amped up on drugs. They really do seem to be “sex workers” rather than victims of pimps, although I am not in a position to know for sure. I had a nodding acquaintance with many of them. In fact, one night when I walked to the train stop, which is in the center of Kings Cross, all dressed up to go to a party, one of the regulars called out, “My, don’t you look lovely tonight.”

  11. TarheelDem

    Your employer could be considering a health plan with no hospital benefits

    That is called a total “health savings account” plan with employer subsidies. That was a year from being implemented for a lot of employers in 2008. The confusion over Obamacare delayed it by five years. It is the 401(k) of health insurance plans.

    Therefore the pressure for health care reform is not dead even if the politics to make it happen is gerrymandered out of existence and blasted with unlimited campaign spending. The implication is that more people will be seeking Obamacare and either being shoved out of employer-based insurance by employer policies or choosing the individual market because employer plans suck.

    Just in time for Hillary. What an amazing coinkydink.

    1. diptherio

      I think you’re right about there still being momentum for health care reform. From the article:

      Such plans come with deductibles as low as zero for doctor visits and prescriptions and co-pays of only a few dollars, they say. Emergency-room visits cost members in the $250 or $400 range, depending on the plan.

      By contrast, health-law-approved insurance with inpatient benefits often includes deductibles — what members pay for all kinds of care before the insurance kicks in — of $6,000 or more.

      Couple of things here: 1) Emergency room care is more expensive for the hospital to provide than patients who come in through the regular admission process. 2) The poor are already being shunted into ERs by default, as we often wait until it’s an emergency to seek care, and everyone knows they have to take you in the ER–these plans do nothing to stop that and, in fact, even provide a financial incentive to the insured to try to get ER care instead of regular hospital care whenever possible. 3) ERs are already overcrowded, especially in our large urban areas.

      For these reasons, I think we might get some push-back from hospitals if these sorts of plans become widespread (which I’d put money on)–although if these plans provide some compensation to hospitals for what would have otherwise been charity ER care, then maybe we won’t.

      And why will people happily pay for this limited form of health insurance? Because their other options are so ridiculously sh*tty.

      So yeah, there’s still going to be some momentum. Might take a couple of years for the reality to sink in, but it will soon enough. We’ve constructed our economy around large-scale looting, it’s only a matter of time before the elites take just a little more than people are willing to give them…granted, people will often give quite a bit before they get to that point, but in the long-run, the probability goes to one.

    2. jrs

      Did you read the article? They aren’t talking about “health savings accounts”. Health savings accounts were SUPER HIGH deductible plans that usually came with an option of sheltering money from taxes for health expenses. In most cases I think they DID PAY for hospitalization! It’s just it wouldn’t kick in until you hit a 20k deductible and so on. And they weren’t just offered to low wage workers they were offered to workers with other options. Now I always thought “health savings accounts” were bad coverage, so I’m not saying they are a just great, but this seems to be something new, although prior to the ACA employers were under no mandate at all, now they are mandated to provide garbage plans. These plans do not appear to be health savings accounts in any sense. They are just straight of garbage health insurance plans that don’t cover you when you most need it, and have no savings account component.

    3. fresnodan

      “Your employer could be considering a health plan with no hospital benefits”
      Actually, I’m pretty sure they’re trying to delete the word “hospital”
      Your employer could be considering a health plan with no benefits.

    4. afisher

      Regarding the calculation program testing that may allow some companies to offer health care programs that omit hospitalization coverage: Read the Kaiser article and then the embedded link – this sounds like a problem that companies that want to skrew their employees – and these are not those who are unable to sign up via the ACA website.

      The interim problem – until the actual sign-up process in Nov – is to spread the message far and wide for new ACA company offered employee plans need to read carefully what is included.

      This particular site has a history of being the naysayer to health welfare and IMO attempt to traffic on the Kaiser Healthcare Foundation name – and hope no one notices.

  12. alex morfesis

    Holder Resigned ? or unleashed ?

    gotta hand it to my favorite little beria, Ms Jarrett…perhaps I am wrong…but it would appear, from the fine print, that he said he will resign when his replacement is approved…so…you can’t threaten the AG anymore since he has already “resigned” but he will be able to do as he pleases…and the administration can put forth a few supper aggressive AG candidates which the GOP will hate…but the more they refuse to affirm, the more Holder can do…its not like some major firm is going to hire him to be managing partner so…he will be 64 soon enough…

    my guess is he is gonna have a lot of fun for at least the next six months…and will ratchet up the heat…darrell Issa and his supporters should put a few more viper alarms around them and sleep under their beds. how exactly do the people of california hire a common thug as congressman…ISSA…where have I heard that lately…hmmm….well isa is what ? jesus in arabic…so…hmmm…enuf hmmms and back to the subject…holder unleashed…just a little theory…gotta love jarrett…she is such a little genius….just like her greatgrandpappy…

  13. barrisj

    Hawthorne defeats Sydney Swans in Grand Final at Melbourne Cricket Ground…and no beheadings were reported amongst the spectators! A huge win for Tony Abbott and ASIO in their battle against Islamic State and its supporters.

  14. docg

    re Stiglitz on austerity:

    I admire Stiglitz and usually agree with him. But realistically, what is the alternative to austerity? Lower taxes? On that I agree with him — that solution is a joke.

    The only alternative I can see is more loans. That issue is rarely if ever discussed when liberals complain about “austerity”. More loans just means kicking the can down the road. More loans means extension of the Ponzi economics we’ve been living off for years.

    Also, excuse me but what exactly does “lack of demand” mean? A phrase only an economist could love. What social good is achieved by an increase in “demand”? If people can live within their means, without consuming mass quantities, why isn’t that a good thing? “Demand” is something cooked up by marketing specialists and PR operatives working for capitalists. We need more “demand” like we need a hole in the head. And after all, what pays the price for that increased demand? More loans, natch. Or printing more money, which feeds into the same Ponzi strategy.

    Sorry, Mr. Stiglitz, but what we need is not more loans, more “demand,” more Ponzi-style debt accumulation. What we need is: 1. higher taxes on the rich (MUCH higher); 2. the nationalization of all financial institutions; 3. socialism.

    1. Banger

      We do need socialism and more central planning if we were totally realistic about dealing with our problems. Demand would come, in a rational system, on retooling our economy for energy efficiency and alt energy. But we are, as a political-economy and culture exactly the opposite of rational and realistic so socialism is impossible thus all that we have left is a modified libertarian project that deconstructs a government that legislates and dispenses justice in a way that ONLY benefits the rich. We need to attack the system and undermine it in every way possible in order to be able to create a new system based on conviviality and trust. Very difficult but is there an alternative? I see none.

    2. Chris in Paris

      I too was nonplussed by his article. I wanted to say, but what do you want us to buy, real estate? New cars? I understand that getting more activity in the economy has multiplier effects but what will it do about this feudalisation? I don’t want to be a serf with a new Renault.

      So yeah, I agree with your points.

      1. Banger

        That is why we need to work with a deeper level, that is, metaphysics. Without being able to articulate what the good life is or delve into the realm of meaning how can we determine goo public policy?

        1. Ulysses

          I think most public policy is already goo, pretty nasty goo at that!! Seriously, though, you are right that we do have to work harder at drawing compelling pictures of how life would be better in a post-kleptocratic world. I recently discussed with a writer friend of mine the crying need for more non-authoritarian, utopian visions in contemporary fiction. There are tremendously fertile fields of future dystopia being ploughed, but utopia can’t be perceived through the dense fog of our nightmarish present.

          We know that we can’t have either absolute liberty or absolute equality. Yet can’t we imagine a world in which we are free to live and love as we please, while still caring for all of our brothers and sisters as we should like them to care for us? Wouldn’t it be nice if life was more party and less strife?

          Up in Rhode Island I know an older woman and her adult son who spent more than a year living out of their car. They are wonderful people who have been terribly beaten down by our system. The extravagant gratitude they have lavished on me– for the small kindnesses I have been able to share– just about breaks my heart. No one should live afraid and in dread of the horrors yet to come.

          Our new system can build new bonds of solidarity to make us eager to share all that is good with all who share our planet. The first thing we must learn is that life is an undeserved gift.
          “Dreamer of dreams, born out of my due time,
          Why should I strive to set the crooked straight?
          Let it suffice me that my murmuring rhyme
          Beats with light wing against the ivory gate,
          Telling a tale not too importunate
          To those who in the sleepy region stay,
          Lulled by the singer of an empty day.”
          — William Morris

          1. The Black Swan

            I think I got this recommendation from a commenter on NC, but ‘Woman at the Edge of Time’ by Marge Piercy paints a beautiful picture of how human beings can live with each other and as part of an ecosystem.

      2. abynormal

        interesting. “When a destitute mother starts earning an income, her dreams of success invariably center around her children. A woman’s second priority is the household. She wants to buy utensils, build a stronger roof, or find a bed for herself and her family. A man has an entirely different set of priorities. When a destitute father earns extra income, he focuses more attention on himself. Thus money entering a household through a woman brings more benefits to the family as a whole.”
        Muhammad Yunus

          1. abynormal

            first remember he’s talking about destitution. if (likely in most cultures) a couple separates or divorce then a high percentage of women stay with their children, even if their destitute. men may pay a percentage of the child’s needs but in order to survive he will have to spend it on himself first. destitute men won’t be purchasing high-end or large ticket products for themselves but a woman is expected to in order to maintain the health and well being of the children. this is also a pattern for families that have to split up for job or health regulating purposes.

            i don’t see it as a matter of men vs women…poverty is violent and the oligarchy’s expect both sexes to survive it or not.

    3. abynormal

      “I profoundly believe, as Grammen’s experience over twenty years has shown, that personal gains is not the only possible fuel for free enterprise. Social goals can replace greed as a powerful motivational force. Social-consciousness-driven enterprises can be formidable competitors for the greed-based enterprises. I believe that if we play our cards right, social-consciousness-driven enterprises can do very well in the marketplace.”
      Muhammad Yunus

      “Once poverty is gone, we’ll need to build museums to display its horrors to future generations. They’ll wonder why poverty continued so long in human society – how a few people could live in luxury while billions dwelt in misery, deprivation and despair.”
      Muhammad Yunus, Creating a World Without Poverty: Social Business and the Future of Capitalism

    4. Lambert Strether

      I have demand for fixing the teeth I have not yet fixed, more insulation, a new boiler, and a new roof. If the money that had been helicopter dropped to the banksters, with nothing to show for it, had been helicopter dropped to me, I would have fixed all my teeth, insulated the house, bought the new boiler, and bought the new roof, all of which would have given many local residents employment, besides achieving the social good of lowering my carbon footprint and improving Maine’s housing stock (the oldest in the nation). That would be the beneficial effect of satisfying aggregate demand.

      You also seem to be under the misapprehension that taxes on the rich would fund this spending. They don’t, because under a fiat regime, Federal taxes don’t fund spending. (Taxing the rich heavily is a good idea to prevent them from buying the government with their loose cash, to prevent the formation of an aristocracy of inherited wealth, and as a mental health measure for the children of the wealthy, but it won’t fund anything.)

      I’m all for epater le bourgeiosie, heavily, but we have to build on accurate conceptual foundations.

      1. docg

        Yes, and if $50,000 or so had been helicopter dropped to everyone then how many would be motivated to keep working at their old wages? Once they realize that under the Modern Monetary regime, or whatever you call it, the govt. could easily come up with another $50,000 each, as needed to “spur demand,” then why not just quit the job and live off the helicopter drops? So, to lure workers back, employers would need to drastically increase wages, which sounds good until you realize that “whoops,” we got runaway inflation on our hands. So next time you head for the dentist he wants four times as much. Oh wait I forget, that isn’t part of the theory so it could never happen.

        Guess you don’t see the absurdity of the government handing everyone spending money to “increase demand.” Socialized capitalism is what I call it. But hey, that’s an “oxymoron,” so can’t ever happen.

        1. docg

          “under a fiat regime, Federal taxes don’t fund spending.”

          Huh? What does that mean? Federal taxes are paid to the government and any money in the govt. kitty can certainly be used to pay for anything the govt. wants to pay for. A wealth tax of say 10% on all wealth in excess of, say, $10,000,000 would probably be enough to fund all sorts of great job programs, infrastructure programs, even a war or two.

          1. LifelongLib

            A government that controls its own currency that is not pegged to anything else (like the U.S. with the dollar) can create any amount of the currency, without taxing or borrowing. The currency is created by (federal) government spending. In that setup (the one we actually have) taxes are used to drain off extra money that might cause inflation, or (as Lambert says) to affect the distribution of money. The taxes don’t fund spending.

          2. ewmayer

            @docg: Yeah, I had the same kind of “wtf?” as you — if Federal taxes don’t fund spending, then what *do* they fund?

            Pilkington has a post nextdoor today about “dogmatic economics”. The above non sequitur is one of the cornerstones of MMT dogma – another being “taxation is what gives a fiat currency its value.” OK, so let’s assume the latter axiom is true and see where it leads: We need taxation to give our currency its value (because the productive goods and labors which we use the fiat as a means of exchange for have no value absent the taxation-imparted one, apparently). So we dutifully pay our taxes, thus lo! Thereby magically bestowing retroactive value on the Things That Were Taxed – but since the government we pay the taxes to has no use for the monies, where do they go?

            I’m gonna predict an MMTer’s answer will be something along the lines of “well, since the government uses taxation to give its fiat a value and thus ends up with bushels of the stuff, since hoarding it is not a good option, it makes sense to spend it on stuff and get it back into circulation. But government can print as much as it needs at any time to fund its spending, and that is a feature, not a bug, because such fiat creation-and-spending drives demand which fuels economic growth”. In other words, a completely government-centric view with government as the driver of all things via the miracle of taxation-valued fiat.

            1. Yves Smith Post author

              You’ve made it clear you don’t understand MMT and are not willing to invest the effort to understand it. So your remark is pure projection. You are the dogmatist, and there is no point in reasoning with you.

            2. docg

              I’m not an economist, so all I can say is that the creation of money does not equal the creation of commodities to buy with the money. The govt. can print all the money it likes, sure. But so long as production remains flat the amount of money required to purchase the various commodities (including the cost of labor) is going to go up. I’d love to say I don’t get it. But actually I do. MMT is an emperor without clothes.

              And Lambert: if by increased demand you mean demand for things like dental work and home repairs, then sure that sounds fine. But that’s not what Stiglitz, or any of the other economists are saying. They are NOT saying that people need more money to pay for dental work and home repairs, things they actually need. They are not saying this is the problem with our economy, that people can’t afford what they need. What they are saying is that what the economy needs is “increased demand.” So it doesn’t really matter what you spend your money on, whether it’s dental work or a new Ferarri. As far as they’re concerned it’s all the same. And as far as I’m concerned they are full of it.

              1. docg

                Yves, I have a lot of respect for you and I acknowledge that you have far more understanding of economics than I do. However, I HAVE tried to read the many posts here touting the values of MMT — and at a certain point my eyes just glaze over. I just don’t get it. And I have a feeling most others don’t get it either. Usually when you need to really study something in great detail in order to understand it, there is something very wrong with the concept. Either that or it’s too sophisticated for the average person to understand. Which makes it awfully hard to convince people to accept as the basis for public policy.

                My guess is that this is something essentially of theoretical interest that will never fly in the real world. Whether it would actually work if implemented is a question I’m not qualified to answer.

                1. nony mouse

                  MMT is not something that needs backing. it is a statement of how our money works.

                  setting aside that the ‘money creation’ back in the days of the revolution was done through loans probably backed in actual gold transfers.

                  fiat money that we have is not backed in anything, and not reliant upon anything except the issuing power of our government. how would a government, the effective issuer of our currency, create enough money to pay back the ‘borrowed money plus interest’ otherwise? that process itself suggests that more money has to go back into the borrowing process than exists in the first place.

                  You are a government. you issue currency to pay your bills. that currency goes around the marketplace and into various hands. how can you ever pay it back without taxing it ALL (plus the interest) back out of the economy?

                  it should suffice that Greenspan and others have essentially said that our government cannot ever go bankrupt. the thing we have to worry about, and seem to constantly try to pre-empty, is the ability to force other countries to take our currency as payment for actual goods and services. especially since we don’t seem to be self-sufficient in anything anymore. but this is fine, as long as we are the world’s reserve currency.

                  it’s not that the concept is complicated. it’s quite simply logic. it’s so simple, that it feels like a trick or sleight of hand. and essentially, that is what it is. but basically, it’s because our gov’t can do what it likes, as it is the one creating the money in the first place.

                  bonds are sold to satisfy people who hold a lot of dollars and don’t want to invest in anything riskier. also, in theory, to keep that money from also being let loose all at once into the economy and causing inflation.

                  don’t be confused by the fact that, at our origination as a country we took out various loans and either reneged on them (supposedly helping to cause the French Revolution in the process) or paid them back with gold. that was a different world and different economy, and we had little domestic production and mostly commodities back then, so had to be reliant elsewhere.

                  my theory is that they are slowly returning us to a commodity economy, with a techno-managerial master class running it all for the master-owners.

                2. trish

                  “Usually when you need to really study something in great detail in order to understand it, there is something very wrong with the concept. Either that or it’s too sophisticated for the average person to understand. Which makes it awfully hard to convince people to accept as the basis for public policy.”

                  or we’ve been so socialized/inculcated subtly and not so subtly to see things in a certain way- a reality that isn’t so but becomes one, and hence assumed to be… hard to break out of that.

                  I’m not the brightest here on this site, not a lot of econ knowledge, but I read the MMT posts and was fascinated that something “basic” about how our system supposedly worked that I thought I understood wasn’t really exactly how it was.

                  I got it but it was the turning over of what I “understood” that was hard and I have to go back to MMT posts sometimes to remind myself how it really works…my brain seems to want to “flip” back…

                  this probably makes little sense…

              2. jonboinAR

                If government would spend on alternative energy, retrofitting inefficient housing and other buildings, fibre optic Internet everywhere, a new electrical grid, bridges, etc, that alone would increase demand in a way that most of us would consider useful in a beyond-economically sense, ie, not wasteful. I think you agree with that. Now, does it need to tax in order to have the money it needs to buy these things. I can see why MMT says no. It can simply order them done and print the money to pay. If there really is “spare capacity”, then until that’s used up, there shouldn’t be much inflation pressure.

                How government goes about that printing, though, the mechanism, boggles my mind. I just figure it can. Why’s it have to go into “debt”, pay interest, what it means when it owes principal and interest, who it owes to. Can it just print to pay that? If so, why go through that rigamarole at all? Having no financial, accounting background at all, I don’t get any of that. I can only sort of follow the very rough steps I talked about in the first paragraph. I kind of get that money is not resources, and that resources ARE the limitation of what can be done.

                1. nony mouse

                  if it had to pay it all back (through borrowing) plus the interest, how would it be possible to do that with the money it borrowed to create the currency in the first place?

                  what would it have been ‘borrowing’ in the first place? if dollars did not exist prior to borrowing them? yes, I know back in the day gold.

                  if you only have an interior economy to satisfy (theoretically autarky), then having a total fiat currency is not an issue at all, as long as everyone agrees that using the currency is easier than not doing so. Stephanie Kelton says that the inducement to using the money is the taxation system. it’s not that taxes pay for spending. it is that having the tax man hanging over your head for some dollars at the end of the year is sufficient to cause you to want to obtain them and keep them around.

                  the gov’t prints to prevent inflation, and to satisfy people who want a no-risk investment for the dollars they hold. it also uses this ready justification for why it can’t ever do social programs, but has an endless supply of billions for war and military and jails and a million other things.

                  the true problem is that we are destroying actual resources (albeit misguidedly created ones) with spending on such things, when those same resources could have been used to do all of the nice things you open your post with.

                  if an idiot like me, wondering in my metaphorical basement, can deduce (or infer? I was never quite sure which) that there is ‘no there, there’ when it comes to the whole paying back the bonds to borrow the intitial money with more money than was created by borrowing for that in the first place, then so can anyone at this website. you all are about a million times brainier than I am.

                  1. jonboinAR

                    Thanks for your thoughtful reply. One of my main questions about MMT is, say, it’s main purpose is to explain how our modern monetary system actually works, and it posits that the US as a sovereign issuer can simply declare all of it’s money into existence, then why does the US Treasury have to go through that whole deal of selling bonds in order to raise cash and everything, then it has to pay interest, then the supply has to keep rising in order to keep up with the (exponentially?) expanding interest payments, and everything? Surely, if the US Treasz (or maybe it’s the Fed that would, beats me) can just declare $$, surely! it can’t just be Steph and Warren and Joe and them that’s figured that out. What’s the point of any of that headache with national debt and everything that ties us up so badly?

                    1. LifelongLib

                      Over my head here, but my understanding is that the U.S. Treasury is required by law to issue debt (bonds) in the amount that the government spends above tax revenue. This makes it look as though the federal government is spending based on taxes/borrowing but in fact this is an artificial requirement that it imposed on itself. Absent this requirement the government could simply spend money into existence regardless of tax revenue, and without appearing to borrow.

        2. Ed

          Labor force participation for adult workers is 58% now, and would probably drop to around 30% if all the bullshit jobs were eliminated from the economy. At this stage of industrialism, we just don’t need all that many people working for wages. In fact, it would be better for the environment if fewer people worked for wages and drove to work.

        3. Calgacus

          Docg, Lambert has it right.

          Also, excuse me but what exactly does “lack of demand” mean? A phrase only an economist could love.
          When good economists use the phrase, they mean lack of effective demand from the poor (the bottom 90%) and unemployed. This leads to a stable situation of high unemployment and increasing poverty, depression, recession or stagnation. Comparatively speaking the “advanced economies” have been stagnating for about 40 years.

          What social good is achieved by an increase in “demand”? Poor people eating, not living in cardboard boxes. The demand that is always restricted by the plutocratic oligarchy is that of the “lesser people” – the 99%, for sane purposes. The disgusting crimes and insane whims of plutocrats are always fully funded by such states.

          “under a fiat regime, Federal taxes don’t fund spending.” That is the correct accounting, The federal government creates money when it spends, and destroys it when it taxes. There is no other way it could work. Where else could the money that people pay taxes with come from?

          You are right about the possibility of inflation. That is why MMT considers inflation very carefully. MMT thinkers do not recommend the “helicopter drop” approach to increasing demand, which is not a goal in itself. They emphasize that universal income is either a pittance or dangerously inflationary. The core policy proposal is the Job Guarantee, which is not inflationary, and has a spectacularly successful record wherever anything near has been tried. Spectacularly successful from the 99%’s vantage. Hell from the 1%ers . Because their aim in practice is the degradation and misery of the 99% – not their own material enrichment.

          1. Ulysses

            “Because their aim in practice is the degradation and misery of the 99% – not their own material enrichment.”

            This is probably a pretty fair assessment of those who are actively fighting the class war on behalf of the kleptocrats. There are, however, quite a few wealthy people who are fairly insulated from the harsh realities outside their gilded bubble. Not all of them actively wish for others to be miserable, they are simply too incurious about the world to understand how much of their wealth is derived from exploitation of others. They are like people who pretend not to see a bully’s violence, because the bully isn’t hitting them.

          2. docg

            “When good economists use the phrase, they mean lack of effective demand from the poor (the bottom 90%) and unemployed.”

            But that sounds like you’re saying it’s the responsibility of the poor to save the economy by finding ways to spend more and save less. I know that isn’t what you mean, but that’s how it sounds. As far as politics are concerned, it seems as though economists have a tin ear.

            “What social good is achieved by an increase in “demand”? Poor people eating, not living in cardboard boxes.” But how can poor people spending money they don’t have enable to them to eat and find shelter? Before they can “demand” goods they must have the wherewithall to pay for them. It sounds like you’re putting the cart before the horse. To you this may be merely a theoretical objection, but to most people it sounds like typically callous econospeak.

            “The federal government creates money when it spends, and destroys it when it taxes. There is no other way it could work. Where else could the money that people pay taxes with come from?”

            As I said above, I’ve read a lot, mostly on this blog, about MMT, but statements like the above still strike me as totally opaque. It may be true but it’s completely counter intuitive. Is there a clearer way to explain this without writing a long essay?

            1. nony mouse

              I have tried to do it above. to understand it simply, you have to forget the fact that our country started its infancy by borrowing money from other countries to get going, and then either reneging on loans or trading on our commodities.

              pretend you are a country and need currency–what are you borrowing to create the intitial money with? how can you borrow ‘dollars’ that do not exist? you don’t. you simply issue them.
              how can you pay back interest, when what you borrowed only allowed you to create x amount? now that x amount is in the hands of the entire country? also, you would be paying x + y% back. ok, so you don’t pay it out all at once (bond maturity rates over years). but eventually, you do pay it out. how can you pay back more than was created initially?

              the situation is obscured in our country because we started out with a currency ‘backed in gold’. I am not an economist nor a historian (nor even very smart for that matter) but believe that this was due to our situation at the country’s founding–a subject of an external empire with which we had to trade our commodities for their European ‘manufactured’ goods. until we caught up with those countries and could produce our own goods, we were probably reliant upon gold for trade. Once we became the supplier to the world, and our currency the reserve, we had no reason to limit our money to the amount of gold mined out of the ground and our money would be accepted for trade because everyone else in the world needed it. This leads to another MMT-type observation—how can we possibly keep more dollars than are being used in our own domestic economy running around the world without issuing the currency to do that? the rest of the world would not be able to use dollars for trade, if we constantly had to tax back out the interest to pay for the money having been created in the first place. of course, the interest is just money changing hands, but still…

              in MMT, the only issues are how many resources can actually be bought at the time in the economy, and what the effect of doing that would do to the rest of the participants in the economy.

            2. Calgacus

              Docg: On lack of effective demand, that was not my intention. Fantasy economics posits that there is no such thing as unemployment, and basically that everyone will have enough money to spend. And that if something bad happens, magic will happen to return the economy to fantasy state. I was trying to recommend that the demand of the working class be made effective by putting money in its hands. My apologies if I was unclear. This is the recommendation of insightful economists like Keynes, Lerner, the MMTers and post-Keynesians.

              “The federal government creates money when it spends, and destroys it when it taxes. There is no other way it could work. Where else could the money that people pay taxes with come from?”
              On this – even MMT economists have said such statements are counter-intuitive. They are wrong. They are hyper-intuitive. There is no other way that money could work or ever has worked. There are myriads of examples of things working just like MMT “fiat money” (All money is fiat money.) The problem is that when it comes to money, everyone’s head is filled with counter-intuitive insane raving.

              Basically, think about money in the naivest, most childish possible way. It is correct. The government has printing presses. They print dollar bills with them, and don’t let anybody else do that. Ordinary people have to pay taxes with these dollars. That is it. The end.

              Something which everybody agrees works that way is coupons for a store. The store prints coupons. People get them by various means. They can spend them on what the store sells. The store doesn’t get coupons from customers, the customers get them from the store. The right way to think about taxation is that you are purchasing something from the state when you pay taxes to it. Probably the most familiar example of this kind of thinking is thinking of property taxes as rent paid to the state. If the only tax levied is the property tax, you can think of dollars simply as rental coupons. But again, just like store coupons, dollars are meaningless to the state. The store can shred coupons they receive and the state can shred dollars it receives.

    5. fresnodan

      In the paper containing the chart, published this month in the Journal of Post-Keynesian Economics, Ms. Tcherneva argues that this shift indicates a failure of the approach that governments take to stabilizing the economy. The postwar consensus has been that central bank action to cut interest rates should be the key tool to fight economic slumps, and to the degree fiscal policy ought be used at all, it should be tax and spending policies that boost the economy in the aggregate, such as cutting taxes temporarily.

      She argues that this approach isn’t flowing through to broad-based wage gains because it is so untargeted. “Conventional fiscal fine-tuning measures ensure that when government increases its total demand for goods and services, it first improves the conditions of the skilled, employable, highly educated, and relatively highly-paid wage and salary workers,” she wrote. “It is hoped that after those workers increase their own demand for products and services, the fiscal stimulus would trickle down to the less skilled and low-wage workers.”
      I agree.
      I would grant Stiglitz isn’t as bad as most economists, but I really am getting tired of their inability to discern reality. We’ve had 40 years of stagnant and declining wages, rising inequality, and ever more evidence to those inclined to pay attention to reality, that if only we make money more available, more cheaply, to the people who got us into this mess, everything would get back to normal (which wasn’t so hot anyway).

    6. Ben Johannson

      Also, excuse me but what exactly does “lack of demand” mean? A phrase only an economist could love. What social good is achieved by an increase in “demand”?

      Demand occurs when a consumer signals their desires to producers, which in an economy using money means buying things. In our society, buying things is how businesses determine whether to employ or dis-employ; people with no money can’t signal their desires and get cut out of the loop, hence a lack of “their” demand can worsen an unemployment trend.

  15. ambrit

    Just cruising around the net this morning I stumbled across this about U.S. Air Force procurements.
    In this Yahoo piece it states the U.S. contracted for 20 A-29 turboprop aircraft at $427 million. That’s roughly $21.35 million each. Now go on over to the Wiki on the A-29.
    It puts the cost of one A-29 at between $9 to$14 million.
    I don’t know if the U.S. is insisting on solid gold pilots seats or whatever, but a 50% at minimum cost increase is more than questionable. (They’re being built in Jacksonville FL. Maybe it’s those overpaid Americano workers.)

    1. Banger

      Government procurement systems have become increasingly corrupt as the media has adopted a policy of not reporting in that area–at least as far as “national security” is concerned.

    2. Jetfixr

      This is a first purchase, so they have probably included training, spares (including engines and avionics…..not cheap)

      High tech + extremely low volume + 30-40 year product liability tail = real expensive

      Nobody in the aircraft maintenance industry batted an eye at the “$600 toilet seat” stories. We were surprised the government was getting them that cheap.

      1. ambrit

        The Military is behind the curve here. The private aviation industry has been outsourcing airframe and engine maintenance to Central America on the cheap for years. Come on now. We practically own those little countries. Surely there’s some baksheesh to be made.

    3. optimader

      Arent those being produced to give to Afghanistan? Whats $427MM between friends.
      The subcontractor building the aircraft is owned by Turks and the avionics suite is being supplied by an Israeli owned company (that’s why it’s named Elbit Systems of America! hahaha!)
      See ,as long as your gifting your tax $ Ambrit, you might as wall spread the love!

  16. DJG

    Yves, above, mentions discussing this privately, but it may be time for a discussion of public behavior in the USA: “Given how American have been acculturated not to engage in collective action (and even in those rare occasions when they do, paramilitary policing stomps on it quite effectively), frustrated and desperate individuals who lack an outlet will lash out more and more. One route is shootings.” First, I note that the suspect worked for some kind of subcontractor, and we’ve seen this before, the lack of screening on the part of subcontractors with access to highly sensitive tasks. (The most ironic one, of course, is Edward Snowden.) Second, we are seeing all kinds of threats of the weirdest kind like people standing outside a school with a rifle to honor their supposed 2d amendment rights. Third, much of American social media has a distinctly sour tone–try any comments sections (wow, anger-ganza). Fourth, living as I do in a middle/upper-middle class neighborhood in Chicago, I’m astounded at the daily accumulation of litter–a general shit-in-the-nest syndrome. Fifth, the recent gay bashing just off Rittenhouse Square in Philly. Is this American “individualism” gone amuck? Or is it the result of fourteen years of government/business-sponsored fear and forty years of dismantling of the social state?

    1. ambrit

      Since much of this can be quite readily equated with the American Robber Baron era of roughly 1870 to 1910, the present surge in killings and destruction is easily equated with the Dreaded Bomb Throwing Anarchists of the Fin de Siecle. Expect a lot more of the same as conditions for the masses worsen in the West especially.

        1. ambrit

          No, I agree about LaPierre. However, I’d consider bin Laden for our modern Bakunin analogue, or maybe better yet a Bukharin analogue. What’s wrong with being motivated by an incoherent ideology? Modern politics is rife with it. Politics as Dada.
          Given your point, perhaps it would be a better fit to compare the present discontent with the Peasant Uprisings of the late Middle Ages. We haven’t gotten to the point of burning the chateaux yet, but we will.

    2. Vatch

      I wonder what kind of benefits the employees of the subcontractor received? One of the reasons for using subcontractors is to save money, and subcontractors often achieve this by denying their people the benefits that are provided to the main employer’s people. I suspect that a lot of the people who work for subcontractors are very frustrated, and rightly so.

    3. nony mouse

      anger displacement at work.

      shifting one’s negative reactions from an unsafe, because more powerful and likely to cause harmful retribution, causal party to a more safe, usually because inferior, party.

      that’s why co-workers often get it. also, let’s never forget that the mentality in workplaces is for everyone to know who is on the outs, ostracize them and usually make the to-be-fired employee’s situation worse because they fear becoming next on the list to be fired. it’s a pile-on mentality that I don’t know the name of, but am sure social scientists have named and therefore studied somewhere along the line. not to mention, perhaps if the workers pile on the abuse, they prove their superiority and relatively greater worthiness to their employer/supervisor, who may be watching.

      most fellow employees in a situation where one is about to be let go don’t help, and sometimes actively hurt, the person about to be fired. they figure it is a foregone conclusion, probably justified by the higher mysteries of management, and suddenly find their former fellow substandard in some way, and the victim of his own lack of skills or whatever. it is probably especially galling when the people that are kept are, in fact, less intelligent and capable than the employee being fired (or at least just equally so) and yet the soon-to-be-ex just can’t play the popularity/political game as well as the others. my guess is that introverts and oddballs are almost always picked for this role.

      as both, that makes me scared for my next employment situation. I’d better learn to fake likeable extroversion very quickly.

  17. rich

    Health Deformer’s PEU Targets Hospice

    The Tennessean reported:

    The private equity arm of New York health care investment firm Consonance Capital announced today the closing of a $500 million private equity fund.

    The private equity extension of the firm, called Consonance Capital Partners, was co-founded by former Tennessee Department of Human Services Commissioner Nancy-Ann DeParle.

    DeParle served as President Obama’s conflicted health reformer DeParle’s financial disclosure statements showed residual payouts from her time as a private equity underwriter with CCMP, but never showed any PEU holdings.

    And the public wonders why private equity gets preferential treatment from politicians and regulators. Insiders design a system they can later mine for huge returns while paying no income taxes. PEUs are virtual nonprofits.

    The DeParles of the world decided U.S. medicine needed to be cookie cutter. Hospice of all things should be highly individualized. DeParle et al’s greed does not belong in the hospice arena. It should not be the locus of obscene profits.

    Nancy Ann DeParle is not an oracle but a blasphemer. I doubt that is the story written by the White House and its current occupant. President Obama sold his soul early with his many conflicted appointments. We’ve seen the tremendous harm they’ve wrought to date.

    I thought there was a small corner of the world unreachable by these people. Hospice seemed like a safe place where good people could come together to do sacred work. Apparently I was wrong. Discordant capital has arrived.

    maybe it’s b/c they’re like death?

  18. abynormal

    Russia, viewed by the Obama administration as hostile to U.S. interests, has discovered what may prove to be a vast pool of oil in one of the world’s most remote places with the help of America’s largest energy company.

    Russia’s state-run OAO Rosneft (ROSN) said a well drilled in the Kara Sea region of the Arctic Ocean with Exxon Mobil Corp. (XOM) struck oil, showing the region has the potential to become one of the world’s most important crude-producing areas.

    The announcement was made by Igor Sechin, Rosneft’s chief executive officer, who spent two days sailing on a Russian research ship to the drilling rig where the find was unveiled today. The well found about 1 billion barrels of oil and similar geology nearby means the surrounding area may hold more than the U.S. part of the Gulf or Mexico, he said.

    1. Lambert Strether

      One more reason to invade Canada, the whole oil under the Arctic thing. So what’s with this Middle East nonsense? Granted, Harper and his funders are doing their best to make it all happen peacefully.

      1. abynormal

        ‘…middle east nonsense’ good question. “mistakes were made” and we’ll broker a cease fire between ISIS & ISIS…next few weeks should be interesting.

        backed into this blog
        interesting lectures & funnees etc but look on the left side of page and his tweets are up to date

    2. wbgonne

      We are so screwed. I am coming to believe what others have said for a long time: we are going to burn all the fossil fuel in existence and the planet be damned. Ourselves too. I have heard that human beings ascended the planet’s hierarchy through brainpower and intelligence. I guess I was misinformed.

      1. Ed

        Well the name for the human species should have been “homo artificiens”, not “homo sapiens”.

        What caught my interest is that the Siberian coastline along the Artic is where the methane bomb is going off. I wonder what effect of increased oil drilling there will have on the process.

      2. LifelongLib

        My understanding is that we’re already at the point (with confirmed oil/coal reserves) where global warming rather than lack of energy will be what puts an end to our current economy (and maybe us).

      3. nony mouse

        my personal theory is that we ascended the planet’s hierarchy (that concept in itself is dubiously constructed) by being able to find something to eat in almost every climate across the entire world. we may have used our intelligence somewhat for that, I grant. at least enough to know that if that root vegetable killed Ooga, then it would probably kill the rest as well.

      4. optimader

        “I guess I was misinformed.”

        Yes, you have us confused w/ the mice.
        “Mice are merely the protrusion into our dimension of hyper-intelligent pan-dimensional beings who, unbeknownst to the human race, are the most intelligent species on the planet Earth. They spent a lot of their time in laboratories running complex experiments on humans.

        At the outset, they were so fed up with the constant bickering about the meaning of life which used to interrupt their favourite game of Brockian Ultra Cricket, that they decided to sit down and solve their problem once and for all.

        They were the creators of Deep Thought, a stupendous super computer the size of a small city, to tell them the Answer to Life, The Universe and Everything. When seven and a half million years later it was realised they didn’t know the question to the answer they’d been given, a second computer, of such infinite and subtle complexity that life itself would form part of its operational matrix, was created to work out the Ultimate Question. That computer was known as the Earth. “

  19. Banger

    Once again the NYT, like all U.S. media, refuses to look beyond the bare surface. The fact Iraqi Army units are left to flounder by higher officers seems like an obvious area of inquiry since this is, at present, the focus of U.S. military efforts and, also in case we forgot, this was the army the U.S. created. So there are to factors at work: 1) the Iraqi Army which we supplied and trained at a great cost was a fake and somebody pocketed the money or the the U.S. Army itself is a fraud; and 2) the high-ranking officers were paid off to not resist the IS. Some combination is required here. If “we” are to help Iraq, as a country, then we might-could inquire why this very expensive military organization is non-functional–ya think?

    1. fresnodan

      I’m kinda thinking along the lines of “hell no, we won’t go”
      Maybe the young Shia men, in the words of Cassius Clay (OOPS, I meant Muhammad Ali…irony) don’t have any quarrel with the North Vietnamese……….. or the Sunni……
      And if you can get those South Carolina boys to do it….

      1. Banger

        That doesn’t explain the behavior of the senior officers who left their compatriots in the lurch. I believe that the Iraqi Army was deliberately organized to do just that.

        1. William C

          I saw an interview a while back with an Iraqi soldier. Asked why he and his comrades had run away from IS, he said ‘we did not have any ammunition’.

          I think I would have run as well in those circumstances. I wonder if this was generally true of the Iraqi army. Perhaps the money for ammunition went into someone’s private bank account?

    2. Paul Niemi

      The soldiers were paying kickbacks to their commanders from their salaries, in exchange for not being reported missing, because in fact they had gone home or could not be found. They sold the weapons issued to them. Corruption was the rule under Nouri al-Maliki, a man who was trained and spent most of his adult life in Syria and Iran. Did we expect anything otherwise? The only order seems to have been through subtraction, by the operation of the sectarian death squads. The situation was already outrageous even before ISIS.

  20. fresnodan
    “Lawmakers’ plans to change GPIF are part of a broader drive to reshape Japan. With the return on equity of Japanese companies stuck at half the global average, a new government stewardship code is encouraging the country’s hitherto silent institutions to press companies they own to improve. Tokyo’s stock exchange has also introduced an index of companies that reward shareholders well, partly to guide GPIF on what to buy. The fund has trimmed its bond holdings in the last year while taking small steps on the road to reform, like removing a cap on salaries for investment experts and hiring an activist fund to help with stock management.”

    Bonds are so yesterday. What with the incredible foresight of Wall Street, the sterling reputation of honesty of the this nation’s financiers, the FED’s technocratic brilliance at understanding and managing the economy, the incorruptible and wise leadership of Congress, it goes without saying that funneling more money to stocks is the wise and prudent course of action…
    I mean, who could dispute the wise and munificent actions of the nation’s leaders these last eight years?

    1. nony mouse

      sounds like they want the Japanese citizens, who are reputedly infamous savers, to start gambling their money in the casino (and losing, but shh! don’t mention that part) and need some economo-mystic justification for why that has to occur.

  21. Lambert Strether

    The Times rework of Pavlina’s chart — and I’m certain this was simply an oversight — does not make it vividly clear that in this recession, as opposed to all other previous ones, the bottom 90%’s share was negative. Contrast the Times’s obfuscation (here) with Pavlina’s orginal, where you can see the 90% share dwindle and then go below the baseline.

    Shocking, I know.

    1. psychohistorian

      A simple mistake by the biggest enabler of the global plutocrats I’m sure.

      What we have now is all lies, all the time. The truth would just upset people and we wouldn’t want that.

      I can hear the empire crashing from my back yard.

    2. MyLessThanPrimeBeef

      Good point, Lambert.

      I was too busy getting upset and didn’t notice that not only the share have been dwindling, but it is now negative.

      With an friendly expansion like that, who needs enemy-recessions?

      The more you sell, the more you lose.

      It’s time we say No to Growth.

  22. fresnodan

    How Eric Holder Failed the Economy Bloomberg. Wow, Bloomberg comes out and says Holder’s big failure was not going after banksters. And they take up Bill Black’s argument almost verbatim, about how over 1000 executives were prosecuted in the wake of the S&L crisis.

    A day late and a dollar short. Would have been nice, Oh, 6 years ago…..
    And probably not worth mentioning, but the illustrious Bernanke, Geithner, and Obama, and pretty much all of congress are diligently trying to collapse the country and were wrongly appointed, re-appointed, or elected.

    1. MyLessThanPrimeBeef

      Speaking of banksters, one must remind oneself, at least once in a while, that there is ‘bank’ in ‘bankruptcy.’

      You can’t spell, or have, bankruptcy without (a) bank.

    1. MyLessThanPrimeBeef

      As I have mentioned before, when the NSA goes IPO, it would be one big money maker for the government.

      But in fact, the government does not need that money to be an empire.

  23. Vatch

    The article “Chicago-area air traffic center fire grounds nearly 1,500 flights, disrupts travel”, and the phenomenon of desperate employees or former employees “going postal”, reminds me of the science fiction novel Stand on Zanzibar, by John Brunner. One of the secondary features of the novel is the phenomenon of a “mucker”, that is, a person who has run amok. The world of this novel is over populated, and highly stressful, and some people break, and commit acts of extreme violence. It’s been a while since I read the book, but I seem to recall that the muckers are in a trance like state, perhaps due to hormones and neurotransmitters responsible for aggression, and they are very hard to subdue.

    So something similar to what is occurring now was predicted in the late 1960s.

    1. optimader

      As I think Lambert alluded to a few days ago, and something I think on when in an appropriate funk -how secure are “secure systems” when the human factors can no longer be relied on? This is the weak link in what people may perceive to be an impenetrably security state. It still relies on little people to keep the gears oiled who can go off the ranch so to speak when sufficient stress w/ no resolution goes critical mass.

  24. ewmayer

    o Bad U.S. roads force just in time manufacturers to plan for ‘just in case’ | Reuters

    Who needs roads when everyone knows drones are The Future?

    o Venture capitalist Khosla loses California beach access case | Reuters

    One for the “Class Warfare mit extra Schadenfreude” archives. Allegedly VK has racked up an estimated $20m in fines to date for blocking beach access – peanuts for a squillionaire douchebag like him, but by way of adding insult to injury.

    Mystery Terror Kabuki Theater 2014:

    o New York officials scramble to reassure city after security threat | Reuters

    Terror Kabuki. “Vague but credible threat” from the Iraqi puppet-president, no less! Timing overlap with latest “bombs for democracy” campaign purely coincidental.

    o Two convicted in California of conspiring to join al Qaeda | Reuters

    Terror Kabuki, Left Coast edition.

    o Australia Unleashes Draconian New Anti-Terror Law In Orwellian Orgy Of Baseless Fear-Mongering | Zero Hedge

    Terror Kabuki, Down Under edition.

  25. peppsi

    Overfishing is one of many reasons the planet is fucked. We really need some serious treaties against the practice. I don’t really like the idea of charity, as I see it as a diversion in good minded people from the rest of the economy. But I do donate a lot to overfishing charities.

  26. Kim Kaufman

    Venture Capitalists Are Poised to ‘Disrupt’ Everything About the Education Market
    by Lee Fang

    Education as profit centers and children as widgets only worth as much as the per child $ amount from the states.

    ““It’s really the last honeypot for Wall Street,” says Donald Cohen, the executive director of In the Public Interest, a think tank that tracks the privatization of roads, prisons, schools and other parts of the economy.”

  27. Jeff N

    re: biometric – it’s kind of sad – the hospital where my doctor’s office is, they are trying to collect genetic data (supposedly private/no names involved, etc.), with the noble goal of finding out what genetic combinations lead to which diseases over the long term…
    but in a post-snowden world, it’s something I’ll never participate in.

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