By Bill Black, the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City. Cross posted from New Economic Perspectives
It is good to be Angela Merkel.
Read more...By Joe Firestone, Ph.D., Managing Director, CEO of the Knowledge Management Consortium International (KMCI), and Director of KMCI’s CKIM Certificate program. He has taught political science as the graduate and undergraduate level and blogs regularly at Corrente, Firedoglake and Daily Kos as letsgetitdone
Yesterday, Ezra Klein mouthpieced for Treasury and Fed reported in the Washington Post that:
The Treasury Department will not mint a trillion-dollar platinum coin to get around the debt ceiling. If they did, the Federal Reserve would not accept it.
Needless to say, it’s not surprising that a reading of the underlying statutes suggests Obama was free to use the platinum coin to circumvent the debt ceiling, and conveniently scapegoats the Fed to hide his own preference for imposing austerity.
Read more...Real News Network has run an occasional series based on an interview with Peter Kuznick on what he calls “untold history,” which are important junctures in American history that are airbrushed out of the mainstream narrative. Here, Paul Jay and Kuznick continue their discussion of Roosevelt’s wildly popular vice president Henry Wallace and how he was shoved aside in favor of Harry Truman.
Read more...By Bill Black, the author of The Best Way to Rob a Bank is to Own One and an associate professor of economics and law at the University of Missouri-Kansas City. Cross posted from http://neweconomicperspectives.org/2012/12/kill-the-fiscal-cliff-instead-of-the-economy.html“>New Economic Perspectives
Austerity in response to the Great Recession has proven to be an economic weapon of mass destruction.
Read more...By Philip Pilkington, a writer and research assistant at Kingston University in London. You can follow him on Twitter @pilkingtonphil
In the practical art of war, the best thing of all is to take the enemy’s country whole and intact; to shatter and destroy it is not so good.
– Sun Tzu
Read more...By Dan Kervick, who does research in decision theory and analytic metaphysics. Cross posted from New Economic Perspectives
I thought I would take a break from the latest outburst of debt ceiling mania to call attention once again to the bipartisan plan of budget austerity and recession-tempting economic devastation that will be implemented in March in one form or another, and from which the debt ceiling debate is designed to distract us.
Read more...Matt Stoller is a fellow at the Roosevelt institute. You can follow him at http://www.twitter.com/matthewstoller.
Three days ago, Naked Capitalism published a story, Eight Corporate Subsidies in the Fiscal Cliff Bill, From Goldman Sachs to Disney to NASCAR. Basically, when everyone else was focused on taxes for the wealthy or spending cuts, we actually looked at the underlying bill. And loh and behold, the corporate extenders were egregious and included cash for NASCAR, Hollywood, mining companies, GE, Citigroup, and so on. The reaction has been swift, and is useful to understand, because it points to an underlying political dynamic. And that is, change is possible, and “the system” isn’t inherently dirty. We can make a difference, if we try.
Read more...By Eric Zuesse, an investigative historian and the author, most recently, of They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010, and of CHRIST’S VENTRILOQUISTS: The Event that Created Christianity.
In order to be able to understand the current debt-limit battle in Washington, here is the essential historical background….
Read more...The Real News Network has conducted a series of interviews on the fiscal cliff deal, and the two most recent are worthwhile in and of themselves, and are also good tools for persuading those who fallen for the idea that Obama got a good deal to reexamine their view. With the Vichy Left now trying to soften up the public for Social Security and Medicare “reform,” it’s particularly important to keep an accurate scorecard on what has already gone down.
Read more...By Michael Hudson, a research professor of Economics at University of Missouri, Kansas City, and a research associate at the Levy Economics Institute of Bard College. His latest book is “The Bubble and Beyond.”
Taxes pay for the cost of government by withdrawing income from the parties being taxed. From Adam Smith through John Stuart Mill to the Progressive Era, general agreement emerged that the most appropriate taxes should not fall on labor, capital or on sales of basic consumer needs. Such taxes raise the break-even cost of employing labor. In today’s world, FICA wage withholding for Social Security raises the price that employers must pay their work force to maintain living standards and buy the products they produce.
However, these economists singled out one kind of tax that does not increase prices: taxes on the land’s rental value, natural resource rents and monopoly rents.
Read more...By Jeffrey Sommers and Michael Hudson. Michael Hudson was Professor of Economics and Director of Research at the Riga Graduate School of Law. He is a research professor of Economics at University of Missouri, Kansas City. His latest book is Finance Capitalism and Its Discontents. Jeffrey Sommers is visiting faculty at the Stockholm School of Economics in Riga. He is an Associate Professor of Political Economy & Public Policy at the University of Wisconsin – Milwaukee. The authors have advised Latvian politicians and government officials up to the Prime Minister level. Both have published extensively in the Latvian press.
A generation ago the Chicago Boys and their financial supporters applauded General Pinochet’s anti-labor Chile as a success story, thanks mainly to its transformation of their Social Security into Employee Stock Ownership Plans (ESOPs) that almost universally were looted by the employer grupos by the end of the 1970s.
Today’s most highly celebrated anti-labor success story is Latvia. Latvia is portrayed as the country where labor did not fight back, but simply emigrated politely and quietly. Can this really be a model for the United States or Europe’s remaining social democracies? Or is it simply a cruel experiment that cannot readily be emulated in larger countries un-traumatized by Soviet era memories of occupation?
Read more...By Michael Hudson, a research professor of Economics at University of Missouri, Kansas City, and a research associate at the Levy Economics Institute of Bard College. His latest book is “The Bubble and Beyond.”
The financial sector promises that privatizing roads and ports, water and sewer systems, bus and railroad lines (on credit, of course) is more efficient and will lower the prices charged for their services. The reality is that the new buyers put up rent-extracting tollbooths on the infrastructure being sold. Their break-even costs include the high salaries and bonuses they pay themselves, as well as interest and dividends to their creditors and backers, spending on stock buy-backs and political lobbying.
Public borrowing creates a dependency that shifts economic planning to Wall Street and other financial centers. When voters resist, it is time to replace democracy with oligarchy.
Read more...By Lynn Parramore, a senior editor at Alternet. Cross posted from Alternet
In Washington-speak, “means-testing” is a scheme to deny or reduce Medicare and Social Security benefits for people who are “too wealthy” in the name of saving money. It’s a counterproductive, harmful idea, but one that well-intentioned liberals often get snookered into embracing.
Read more...By Michael Hudson, a research professor of Economics at University of Missouri, Kansas City, and a research associate at the Levy Economics Institute of Bard College. His latest book is “The Bubble and Beyond.”
Today’s economic warfare is not the kind waged a century ago between labor and its industrial employers. Finance has moved to capture the economy at large, industry and mining, public infrastructure (via privatization) and now even the educational system. (At over $1 trillion, U.S. student loan debt came to exceed credit-card debt in 2012.) The weapon in this financial warfare is no larger military force. The tactic is to load economies (governments, companies and families) with debt, siphon off their income as debt service and then foreclose when debtors lack the means to pay. Indebting government gives creditors a lever to pry away land, public infrastructure and other property in the public domain. Indebting companies enables creditors to seize employee pension savings.
Read more...If you’ve been following the story of the official response to Occupy Wall Street, it was apparent that the 17 city paramilitary crackdown was coordinated; it came out later that the Department of Homeland Security was the nexus of that operation. The deep FBI involvement is a new and ugly addition to this picture.
Read more...