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Is G20 summit the most important thing since Yalta? Uneasiness all around the world. Some claim that if the G20 doesn’t innovate, very dangerous solutions will be brought forward by the dispossessed. They’re not listening. They want the G20 to get out of the way and stop stealing our money. G20 or Local Self Help? The IMF is run by Europeans, the World Bank by Americans. The conspiracy theorists are now seeming to be quite right with talk of a global currency and strengthening the IMF. How is that French and Communist Chinese are warning America NOT to go down the path of socialism? The Fed and SEC will likely be placed under the auspices of the IMF, which is putting US economy under global control. The sideshow is the size of stimulus packages. The real show is global control, but hardly anyone is paying attention. The John Birch Society has been talking about global monetary control for several years. Now it seems like it’s almost here. And they are so adept at using the word “crisis” to get us to that point.

Meanwhile, in Afghanistan…

Why is Obama bringing in more troops? We can’t just kill a whole bunch of people and expect it to get any better; the government has to mature, and it’s not doing that. Rachel Maddow talked with Center for a New American Security fellow Andrew Exum about the bleak prospects.

Olbermann is Right: Bankers Have The Audacity

Olbermann: Time to get tough on bankers March 19: In a Special Comment, Countdown’s Keith Olbermann expresses outrage at Wall Street over their continuing misuse of federal bailout money. Olbermann calls for the firing of bank executives and more stringent bank regulation. http://www.msnbc.msn.com/id/3036677/vp/29783656#29783656 They need to be fired. Except Olbermann might just be the head cheerleader on “this is not socialism!” Yes it is. You can’t blame this on capitalism, because they’re getting their favors from the government. Sidenote on the Olbermann segment linked to above: He has a great point that the problem with radio and tv in America today will not be solved by a return to the fairness doctrine, but by stopping the ability of radio, tv, and newspaper moguls from gaining monopoly or near-monopoly control over their “markets”. But then again, isn’t this a responsibility of government? The way I look at this, this additional failure of government ought to make us think again about turning more control over to a socialist regime.

Obama Against Habeas Corpus, Just Like Bush

DemocracyNow.org reports that Obama has been pressing against enemy combatants receiving habeas corpus, a stance that mirrors that of the Bush administration.

Martin Luther King

April 4, 1968 was the date of MLKs assassination. Exactly one year earlier, on April 4, 1967, King delivered his “Beyond Vietnam” speech.

Bush Admin Authorized Assassinations

John Hannah, Dick Cheney’s national security advisor, tried to whitewash the fact that Cheney and others ordered military members to execute non-combat assassinations in various countries.

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Obama’s Deficit

In an effort to increase the United States debt, Obama and congressional Democrats are using a tool that was intended for reducing it.

The House and Senate are preparing to pass President Barack Obama’s radical budget blueprint, with only minor modifications, by using (abusing would be more accurate) the budget “reconciliation” process. This process circumvents the Senate’s normal rules requiring 60 votes to prevent a filibuster. Reconciliation was created by Congress in the mid-1970s to enforce deficit reduction, the opposite of what the president and his party are aiming for.

Feith and the Geneva Convention

Much of the hullabaloo over torture and allegations that enemy combatants don’t deserve protection under the Geneva Conventions stems from a lie.  Douglas Feith says

In conclusion, I urged “[h]umane treatment for all detainees” and recommended that the president explain that Geneva “does not squarely address circumstances that we are confronting in this new global war against terrorism, but while we work through the legal questions, we are upholding the principle of universal applicability of the Convention.”

I briefed these arguments directly to the president at that Feb. 4 NSC meeting, and his decision on Geneva’s applicability to the war against the Taliban was consistent with them.

The allegation that I argued against Article 3 protection was invented by a British lawyer named Philippe Sands and published in an angry, wildly inaccurate book called “Torture Team.” Mr. Sands asserts that, in our interview, I admitted making the case against Article 3. He was eventually compelled to publish the interview transcript, however, and it shows that nothing I said supports his allegation, that he grossly misquoted me on a number of points, and that he never asked me a single question about Article 3.

Not “Too Big to Fail”.  Rather, “1,000 Blooming Flowers”

When a company fails, its assets don’t just go up in a puff of smoke (unless perhaps it’s a financial institution).  That’s why no company is too big to fail.  To wit

Carl Schramm doesn’t buy the idea that some businesses are “too big to fail.” That notion, says the president of the Kansas City-based Kauffman Foundation, only creates obstacles for entrepreneurs. Instead, he sees the failure of big companies as the “moment when 1,000 flowers can bloom.”

The Smear of Congressman Eric Cantor

Obama bi-partisan?  Republicans not?  Sure. Let’s do everything we can to ensure that the Republicans don’t rebound to resurrect their part of old.

…the furious campaign — waged by every blog, pundit, union, 527, and even the White House — to kneecap Republicans who might help lead a makeover. Mr. Cantor is the top target.

This kicked off after the GOP’s unanimous vote against the stimulus, which Democrats saw as an opening to brand Mr. Cantor as the public face of partisan opposition to the “bipartisan” president. The Virginian has in fact publicly reached out to the White House, and has been deeply involved in producing alternatives to administration policies. But never let the facts get in the way of a good smear.

Noam Chomsky: “Why Does NATO Exist?”

Chomsky answers this question on DemocracyNow:

NATO is a US creature.  Gorbachev’s remarkable concession of letting unified Germany join an alliance hostile to Soviets.  The quid pro quo was that “NATO would not expand one inch to the east”.  One of Bill Clinton’s first acts was to break this promise, on the pretext of bringing former Warsaw Pact states into European Union (Austria, Sweden, etc. already did not belong to NATO).  Afghanistan has always been of geostrategic importance, especially because of its energy resources.  US-sponsored atrocities in East Timor (Dealey Massacre?) and Turkey (against Kurds) in late 90’s much worse than in Balkans.  Dennis Blair, one of Obama’s current national security advisors, was involved in encouraging Indonesian crackdown against East Timor. NATO is now just an intervention force. Once used to balance against Soviets, it is now to counteract the technological innovations of Middle Eastern countries.  Obama’s new troops will face two enemies: the Taliban and the opinion of 75% of Afghans.  Like Pashtuns in India whose territory was artificially divided by British. When Hamid Karzai began to ask Obama to stop killing Afghans and to set a timetable for withdrawal, he became looked upon as corrupt and persona-non-grata by the American press/Establishment.  There are now plans by the Establishment to replace him.  Obama is expanding the war because of our unrivaled military force and imperial mentality among both major US parties.  We are as the hammer seeing everything as a nail.  US (Obama) wants to run a major natural gas pipeline through Kandahar, Afghanistan, thus isolating/bypassing Iran and splitting East Asian “stans” from Russia.  John Kerry recently spoke of creating alliance with Israel and moderate (they do what we say) Arab states (such as Egypt) against Iran.  Afghans should make the decision of whether US and coalition troops move out, and we should abide by their decision.

Triple Canopy to Replace Blackwater in Iraq

The Obama administration is using Triple Canopy to protect US diplomats in both Iraq and Israel.  Jeremy Scahill states that the Obama administration is continuing many of the most sinister policies of the Bush Administration.  Triple Canopy lists Lincolnshire Illinois as its primary address.  Triple Canopy, DynCorp, and Blackwater are the three big mercenary groups.  Triple Canopy hired more third-country nationals, including bloodthirsty Salvadoran and Chilean military veterans.  Blackwater still is on US government payroll in Afghanistan and with the Drug Enforcement Agency.  Blackwater guys are jumping over to Triple Canopy.  Secretive Worldwide personal Protective Service started under the Clinton administration.  Government Accountability Office is concerned at the huge costs of hiring private mercenaries.

Obama is Clinton Redux

Jeremy Scahill, author of Blackwater: The Rise of the World’s Most Powerful Mercenary Army, reported last November on alternet.org that the Obama administration is dominated by Clinton retreads.  Additionally, Obama  is backpedaling on getting US troops out of Iraq by the end of 2011.  Blackwater has changed its name to “Xe” (Xe is the symbol for the element Xenon, and comes from the Greek meaning “foreign or strange“), perhaps in the hope that no one will notice that they are still operating in Iraq.  The Obama administration likely hopes that no one will notice that it recently signed a contract to pay Xe–er–Blackwater to stay in Iraq even after they were dismissed as personae non grata by the Iraqi government.  Scahill wonders

With the U.S. economy in shambles and millions of Americans struggling to make ends meet and keep their homes, Obama and Secretary of State Hillary Clinton need to explain to U.S. taxpayers how they justify these mega-payments to a scandal-plagued mercenary company.

The Lies About AIG Bonuses

At least 11 of those receiving more than $1 million bonuses for AIG no longer work for AIG.  This kind of puts to shame the claim that the reason for providing the bonuses were for “employee retention”.  Obama surrounds himself with advisors who are too cosy with Wall Street, like Lawrence Summers and Timothy Geithner.  Instead of supporting the homeowners avoid foreclosure, we instead propped up mortgage lenders.  Banks sold subprime mortgages to the poor, knowing they would be bailed out.  Beleagured US taxpayers are in essence supporting filthy rich US tax dodgers.

“Debt-Encumbered Home Owners Don’t Go On Strike”

The latest economic crisis has been the greatest loss of value for African Americans in the history of the United States.  People are being made to pay with loss of their homes while the bankers are walking away richer than before.  David Harvey of City University of New York may be a Marxist, but I definitely agree with him more than I agree with Timothy Geithner and his financial cronies.  The capitalism of the past thirty years, that awards its high priests with a larger and larger piece of the pie, is a disgrace.   The Mexican bailout wasn’t a bailout of Mexico; it was, rather, a bailout of New York bankers.  The capitalists are now trying to save the pre-existing power structure.  Bankers want to get people in homes, loaded with heavy debt, because “debt-encumbered home owners don’t go on strike.”  They can’t afford to.  We now have essentially only four major banks in the U.S.

It seems like it’s been forever since I could buy a gallon of gas for $1.65.  That might be about as low as it’s going to get, according to Bloomberg.

Oil options contracts indicate that a growing number of investors expect prices to rise from three- year lows, industry consultant Petromatrix GmbH said. The number of outstanding contracts that give traders an option to buy crude oil is nearly the same as the number giving the right to sell for the first time since July 2007…

Hedge funds and other large speculators bet last week that futures will recover, reversing three weeks of bets that prices will fall, according to U.S. Commodity Futures Trading Commission data.

In other words, the speculators are betting that the price of oil will go up.

Back in June, Republicans were claiming oil prices to be on the rise because Democrats were blocking off-shore drilling, but they didn’t talk about the upward effect on prices due to speculation.  Although U.S. off-shore drilling would have an almost immediate downward impact on the world price of oil, the effect of speculation on oil prices reaching record levels in 2008 should not be overlooked.

In the following video, Keith Olbermann talks about how john McCain supported what’s come to be known as the Enron loophole, which unleashed the ability of speculators to run up energy prices.  Olbermann calls it “a legalized form of insider trading” which “lets speculators overwhelming trading in oil futures.”

[http://www.youtube.com/watch?v=ugss-PcNomg]

By being able to speculate on the future of oil prices, according to Olbermann, the speculators have driven up the price of oil to more than double what it was before the loophole was created, and this speculation has created the potential explosion of a large ‘oil bubble’.

Has the bubble finally burst?

Is deregulated speculation a good thing?  Apparently not when employed by self-seeking shysters like Enron, who nearly brought California to its knees by speculating on electricity.  Enron cornered the market on energy, and were able to drive up prices dramatically because of it.

The speculators have not just been placing bets on the price of energy, they have been controlling the future prices in an effort to profit from it, according to Michael Greenberger, former chairman of the US Commodity Futures Trading Commission, who testified before a US Senate committee  meeting on June 3, 2008.  It was estimated that in the last two years, the average family has spent at least $1500 on energy due to collaborative speculation.  Speculation, according to George Soros, has allowed banks and other financial institutions to set aside larger reserves of petroleum than we have in our entire U.S. national reserve.

The Enron Loophole was closed on September 30, 2008.  Not long thereafter, prices started coming down precipitously.  Obviously, other factors, such as declining demand in a weak worldwide economy, have contributed to the downward pressure.  However, it’s clear that speculative control of large swaths of the market caused the price to go up.  It’s more than coincidental that prices have gone down markedly since the Enron Loophole was closed on September 30th.

David Brooks puts into perspective just how grandiose the current, on-going economic bailout is.

Over the past year, the federal government has poured money into the economy hundreds of billions of dollars at a time. It has also guaranteed investments, loans and deposits worth about $8 trillion. Barry Ritholtz, the author of “Bailout Nation,” points out that this project constitutes the largest infusion in American history.

If you add up just the funds that have already been committed, you get a figure, according to Jim Bianco of Bianco Research, that is larger in today’s dollars than the costs of the Marshall Plan, the Louisiana Purchase, the New Deal, the Korean War, Vietnam and the S.&L. crisis combined.

Paul Krugman chastises the Establishment for not noticing the economic freight train that has been approaching at top speed for the past few years:

A few months ago I found myself at a meeting of economists and finance officials, discussing — what else? — the crisis. There was a lot of soul-searching going on. One senior policy maker asked, “Why didn’t we see this coming?”

There was, of course, only one thing to say in reply, so I said it: “What do you mean ‘we,’ white man?”

Why did so many observers dismiss the obvious signs of a housing bubble, even though the 1990s dot-com bubble was fresh in our memories?

Why did so many people insist that our financial system was “resilient,” as Alan Greenspan put it, when in 1998 the collapse of a single hedge fund, Long-Term Capital Management, temporarily paralyzed credit markets around the world?

Why did almost everyone believe in the omnipotence of the Federal Reserve when its counterpart, the Bank of Japan, spent a decade trying and failing to jump-start a stalled economy?

He answers that they did see it coming, but that no one wanted to be the party pooper.

Who wanted to hear from dismal economists warning that the whole thing was, in effect, a giant Ponzi scheme?

[After the crisis of 1997-98] everyone declared a victory party over our pullback from the brink, while forgetting to ask how we got so close to the brink in the first place.

…investors came to believe that Mr. Greenspan had the magical power to solve all problems — and so, one suspects, did Mr. Greenspan himself, who opposed all proposals for prudential regulation of the financial system.

Now is the time, says Krugman, to begin to prevent the next catastrophe.

Yet the experience of the last decade suggests that we should be worrying about financial reform, above all regulating the “shadow banking system” at the heart of the current mess, sooner rather than later. For once the economy is on the road to recovery, the wheeler-dealers will be making easy money again — and will lobby hard against anyone who tries to limit their bottom lines.

Michael Porter, a Massachusetts Republican from Harvard Business School, who worked with the Mitt Romney presidential campaign, thinks that we still have the problem of looking at economics from a fragmented and incoherent political and short-term tactical perspective, rather than from a strategic perspective.

Government leaders react to current events piecemeal, rather than developing a strategy that unfolds over years. Congress and the Executive Branch are organized around discrete policy areas, not around the overall goal of improving competitiveness. Neither candidate has put forward anything close to a strategy; rather, each has presented a set of disconnected policy proposals with political appeal. Both parties contribute to the problem by approaching the economy with long-held ideologies and policy positions, many of which no longer fit with today’s reality.

Ironically, while other countries understand the importance of fair competition, America is shrinking from the competetive.  While we have been falling back to focus on short-term gains, other countries are increasing college education, reinvestment in science and technology as a means to foster entrepeneurship, and they spend an increasing share of GDP on research and development.  In a “me-me-me” consumerism society, this is not surprising that we are falling behind.

Is Obama Lust Nearing an End?

It’s kind of ironic that the media wait until their candidate is elected before they finally admit their personal infatuation with him.  Now they promise to get tough.

Coordinated Mumbai Attacks Do Not Occasion US Self-Reflection

Whenever a terror attack occurs against Westerners in the Middle East, Americans wax poetic about how the terrorists are so rude to Americans. Just as on 9/11, we can’t fathom why they hate us. The coordinated attacks in Mumbai are no different.  As Kenneth Pollack, author of Persian Puzzle says,

Americans are serial amnesiacs. We forget what we have done almost immediately after doing it. We often hold grudges, but we just as often can’t remember why.

We would do well to study our history a little bit more heartily.  Then we might understand why many of our early presidents admonished us not to get involved in entangling alliances.

Iraqis Even Less Enamored with US Now that We Plan to Stay for at Least Three More Years

While the Japanese respect the wishes of the Iraqi people, the United States decides to overstay its welcome once again–for at least three more years.

As The Economy Tumbles

AIG Bailout Is Not Enough

The government has already given AIG over 100 million dollars, but they scream for more:

The government’s original emergency line of credit, while saving A.I.G. from bankruptcy for a time, now appears to have accelerated the company’s problems. The government’s original short-term loan came with an expensive interest rate — about 14 percent — which forced the company into a fire-sale of its assets and reduced its ability to pay back the loan, putting the company’s future in jeopardy.

China “Stimulating” Money Out of Thin Air

In a lesson it learned from perhaps the United States Federal Reserve, China is printing a whole bunch more money so that it can inflate prices there.

China’s package is not comparable to fiscal stimulus measures that are being discussed in Washington. In China, much of the capital for infrastructure improvements comes not from central and local governments but from state banks and state-owned companies that are encouraged to expand more rapidly.

“Over the past two months, the global financial crisis has been intensifying daily,” the State Council said in a statement. “In expanding investment, we must be fast and heavy-handed.”

Asian markets welcomed news of the stimulus plan. The Japanese Nikkei index rose 5.6 percent in trading early Monday. Stocks in Hong Kong and Shanghai rallied strongly, jumping over 5 percent and lifting share prices that have been depressed for much of the year.

We’ll see how long that welcoming attitude lasts.

Will Obama’s Intellectual Capacity Help The Economy?  I’ll Bet It Won’t Hurt!!

Obama just might be the first truly intellectual president since JFK.

Barack Obama’s election is a milestone in more than his pigmentation. The second most remarkable thing about his election is that American voters have just picked a president who is an open, out-of-the-closet, practicing intellectual.

Maybe, just maybe, the result will be a step away from the anti-intellectualism that has long been a strain in American life. Smart and educated leadership is no panacea, but we’ve seen recently that the converse — a White House that scorns expertise and shrugs at nuance — doesn’t get very far either.

As for President Bush, he adopted anti-intellectualism as administration policy, repeatedly rejecting expertise (from Middle East experts, climate scientists and reproductive health specialists). Mr. Bush is smart in the sense of remembering facts and faces, yet I can’t think of anybody I’ve ever interviewed who appeared so uninterested in ideas.

Besides the fact that America now has the respect for diversity to elect a black man, President Obama seems to be able to speak in more than sound bites.

Mr. Obama, unlike most politicians near a microphone, exults in complexity. He doesn’t condescend or oversimplify nearly as much as politicians often do, and he speaks in paragraphs rather than sound bites.

…as Mr. Obama goes to Washington, I’m hopeful that his fertile mind will set a new tone for our country.

Only In America Could Something Like This Happen

Thomas Friedman identifies the pleasant paradox:

So, I was speaking to an Iranian friend about what a mind-bending thing it must be for people in the Middle East to see Americans, seven years after 9/11, electing someone named Barack Hussein Obama as president. America is surely the only nation that could — in the same decade — go to war against a president named Hussein (Saddam of Iraq), threaten to use force against a country whose most revered religious martyr is named Hussein (Iran) and then elect its own president who’s middle-named Hussein.

Is this a great country or what?

But maybe Friedman is a bit to euphoric.

The U.N. says it doesn’t want Iran to go nuclear and doesn’t want the U.S. to use force to prevent Iran from going nuclear. I agree. That’s why I want all those people in China, France, Russia, India and Germany who are smiling for Obama to go out and demand that their governments use their tremendous economic leverage with Iran to let the Iranians know that if Tehran continues to move toward a nuclear weapon, in opposition to U.N. resolutions, these countries will impose real economic sanctions. Nothing — and I mean nothing — would more help President-elect Obama to forge a diplomatic deal with Iran than having a threat of biting Chinese, Indian and E.U. economic sanctions in his holster.

David Leonhardt says we should go further into debt:

This year’s election coincided with an important moment in the financial crisis. The credit markets have stabilized in the last few weeks and even improved a bit. But the rest of the economy is deteriorating fairly rapidly. It’s now in danger of falling into a vicious spiral, in which spending cuts by consumers and businesses lead to further layoffs and then more spending cuts.

Markets have stabilized?  That’s the most wishful of thinking.

To our President Elect, who says…

There is nothing we can’t do, nothing we can’t accomplish if we are unified.

…the Mises Institute asks, So you think you can fool mother nature?

Economics. It’s not just a good idea. It’s the law.

How soon will the honeymoon be over?  Sheldon Richman of the Foundation for Economic Education, warns

Valuable as Obama’s skills are, they will be useless if he attempts to solve our economic problems directly by an exercise of power. That’s because there is something he does not have — something no man or woman can have: the power to repeal the laws of economics.

Obama recently listed his top priorities upon taking office on January 20th.  Every single one of these priorities constitute attempted fixes to the economy.  It may be difficult for most people to understand this, but the laws of economics always win.  If government tries to fix things, it only makes things worse.  Just as FDR’s actions in the 1930’s prolonged and worsened the Great Depression, President Obama’s stimulus packages, health care plans, bailouts for state and local governments, and trillion dollar annual debts will end up making things far worse than they would have been.

It’s unfortunate that the office of United States President approaches ever closer to that of king.  Has a larger group of people swooned so much before one man since the Germans blessed Adolf Hitler?  Richman says

In a truly free society, the presidency would not be the most visible high-status position our society offers. That designation would be reserved for a variety of private-sector roles. Unfortunately, however, the presidency does have that status today, and Obama’s election must be appreciated from that perspective. Relatedly, I am uneasy about, though understanding of, the public displays that followed John McCain’s concession Tuesday night. Again, Wilkinson: “[F]rankly, I hope never to see again streets thronging with people chanting the victorious leader’s name.” Amen.

Richman explains why government will fail against the natural economic juggernaut, and gives a concrete example of what happens when government gets too big for its britches:

We live in a world of scarcity, and the list of scarce resources includes time and knowledge. At any moment demand exceeds supply. Under these conditions, we adapt means to achieve chosen ends. We face opportunity costs and make tradeoffs according to our subjective preferences. The result is the market — that emergent order which serves the general welfare and encourages personal responsibility as each person pursues his or her private interests.

If government…intervenes — to raise or lower costs, to increase or reduce rewards, to tamper with prices or interest rates — we will modify our behavior, knocking self-interest and the general welfare out of alignment. A subsidy for medical insurance will increase the demand for services and raise prices.

The primary reason health care costs are so high in the United States is government.  Government can fix the problem, but only by making laws that comport with the inexorable laws of economics.

A former aide to President Ronald Reagan thinks Obama is in a sticky wicket.  This from the New York Times:

Much of the issue may be out of Mr. Obama’s hands. The $700 billion financial bailout threatens to push the deficit into the stratosphere. “The poor man has his hands tied by the economic and financial mess we have right now,” said John Tuck, a former aide to President Ronald Reagan. “I don’t know what his options are. They’re very, very limited.”

FDR was ambitious.  He got a lot done, and we’re still paying for it.  LBJ was nearly as ambitious as his political idol.  He gave us The Great Society, which began a sharp downward trend in social and economic cohesiveness.  Maybe it would be better for Obama to be ambitious.  The backlash would be even more ambitious and very fortuitous.