The Rhetoric of Fear About Ahmadinejad Is Foolish

Posted on September 25, 2008 by RagBlog

Iranian President Mahmoud Ahmadinejad addresses the United Nations General Assembly in New York Sept. 23, 2008. Photo: Reuters/Mike Segar

Obama goes over the top in bashing Mahmoud Ahmadinejad
By Juan Cole / September 24, 2008

Once again, U.S. politicians, including both Sarah Palin and Barack Obama, pile on the Iranian president. Why does Larry King (!) sound like the adult in the room?

Sen. Barack Obama responded with outrage to the remarks made Tuesday by Iranian President Mahmoud Ahmadinejad before the United Nations General Assembly, expressing regret that the quirky little president was even allowed to speak. Obama’s denunciation was mild compared with that of Gov. Sarah Palin, who accused Ahmadinejad of dreaming “of being an agent in a ‘Final Solution’ — the elimination of the Jewish people.” In contrast, “Larry King Live” carried an hourlong interview with Ahmadinejad in which the Iranian was allowed to speak for himself and repeatedly denied any violent intentions. King thus reinforced the trend whereby entertainment television, whether Jon Stewart’s “The Daily Show” or King’s own dog-and-pony interview hour, conveys reality-based news while politicians continue to paint inaccurate and even fantastic scenarios that are harmful to U.S. foreign policy.

In his speech, Ahmadinejad said “the American empire … is reaching the end of the road” and accused the U.N. Security Council of allowing “Zionist murders” because of “pressure from a few bullying powers.” Obama issued a statement saying, “I strongly condemn President Ahmadinejad’s outrageous remarks at the United Nations, and am disappointed that he had a platform to air his hateful and anti-Semitic views.” He added, “The threat from Iran’s nuclear program is grave.” Obama then called on his rival in the presidential race, Sen. John McCain, “to join me in supporting a bipartisan bill to increase pressure on the Iranian regime by allowing states and private companies to divest from companies doing business in Iran.” He slammed McCain, saying that the senator was playing partisan politics by declining to join Obama in this divestment campaign.

In the heat of the campaign, Obama surely overreached himself in appearing to advocate barring leaders of member states from addressing the United Nations because their views are obnoxious to Americans. He also fell into the trap of declining to make a distinction between anti-Zionist views and anti-Semitic ones. If a policy of exclusion had been adopted by past administrations, Soviet Premier Mikhail Gorbachev could not have announced from that podium the reduction of Red Army forces in Eastern Europe in 1988. And if anti-American statements should trigger the denial of a visa to come to New York, should Nelson Mandela, who called the United States the “most dangerous country in the world,” be excluded, too?

Obama’s assertion that Iran’s civilian nuclear energy research program constitutes a “grave threat” may or may not be true. The 2005 National Intelligence Estimate put Iran at least a decade away from having a nuclear weapon if it was trying hard to get one and if the international environment was conducive (i.e., if Iran could import all the equipment it needed easily). Neither of those conditions actually appears to exist, so Iran is very far away from having a bomb. The 2007 National Intelligence Estimate on Iran, parts of which were released last December, concluded that Iranian scientists have not done any weapons-related research since early 2003.

As Ahmadinejad pointed out to Larry King, no country has been as intensely inspected by the International Atomic Energy Agency as Iran. No regularly inspected country has ever developed a nuclear bomb. Although the IAEA’s Mohamed ElBaradei has expressed frustration that Iran failed to declare its nuclear research program before 2003, he continues to say that in current inspections, “the Agency has been able to continue to verify the non-diversion of declared nuclear material in Iran” to weapons purposes. This consistent IAEA finding through recent years raises the question of whether Obama is right to be so categorical on this issue.

As for the imposition of economic sanctions on Iran, it might be worth considering for a moment whether the U.S., with its faltering economy, is even able to cause a major oil exporter such as Iran much harm through a unilateral boycott. The law passed by Congress at the insistence of the Israel lobby, placing sanctions on firms doing business in Iran, does not punish those who merely distribute or import Iranian petroleum. Does Obama want to go even further with sanctions? If Congress really could close down Iran’s production of 4 million barrels a day, it would cause the price of petroleum to soar and throw the U.S. into a deep recession or depression. From the point of view of a reality-based foreign policy, this sort of step is known as “cutting off your nose to spite your face.” Russia and China are now balking at placing any further sanctions on Iran via the United Nations Security Council. (Russia is not exactly in a cooperative mood after the drubbing it took from U.S. politicians over its intervention to protect South Ossetia from Georgia.)

The sanctions have in any case had no effect on Iranian policy, though they are keeping Iran’s gas fields from being developed by American and European firms, a task that may fall to Russia’s Gazprom or its Chinese counterpart instead. (One would not advise a President Obama to threaten to cut off economic cooperation with China over its Iran investments, given how much U.S. debt Beijing holds.) Since natural gas is a global market, this boycott of Iran harms American consumers twice, causing the price of gas to be higher than necessary and making sure that the development of Iranian gas creates no jobs for Americans and brings no profits into this country.

If Obama’s reaction to Ahmadinejad was a bit breathless and probably counterproductive to U.S. interests, Gov. Palin’s was, typically, like something from outer space. In a speech the Republican vice-presidential nominee had planned to give at an anti-Ahmadinejad rally on Monday, organized by right-wing Zionist organizations before they decided not to have major politicians speak, she alleged that the Iranian president “dreams of being an agent in a ‘Final Solution’ — the elimination of the Jewish people. He has called Israel a ‘stinking corpse’ that is ‘on its way to annihilation.’ She warned apocalyptically that Iran had tested missiles capable of reaching Tel Aviv and that “the Iranian nuclear program is nearing completion.”

But is the Iranian president genocidal? Ahmadinejad explained on “Larry King Live” (you’d think at least Palin would watch that even if she does not, like, read books and newspapers) that there are some 20,000 Jews in Iran, who have a representative in Parliament. That representative, Maurice Motemad, and leaders of the Iranian Jewish community, have repeatedly protested to Ahmadinejad over his minimizing the extent of the Holocaust. Ahmadinejad told King, “We don’t have a problem with the Jewish people” (ma ba mardom-e yahud moshkeli nadarim). If Ahmadinejad wanted to launch a second Holocaust, would he not begin at home? It is tiresome to keep having to repeat it, but, moreover, Ahmadinejad does not have the power to launch any massacres, since the presidency in Iran is a weak position similar to that of our secretary of the interior. The commander in chief of the armed forces is Ayatollah Ali Khamenei, who has pledged an Iranian policy of no first strike against any country.

As for Jews in Israel, Iran has not threatened to kill any of them, much less all of them. On “Larry King Live,” Ahmadinejad expressed the hope that the Israeli state will collapse just as the apartheid regime in South Africa did. In other words, he is advocating a variant of the one-state solution to the Israeli-Palestinian conflict. While his version of that one state is unrealistic and unfair to Israeli Jews and does not have a prayer of being realized, it is not a genocide, and it is a barefaced lie to say that it entails the killing of anyone. As Larry King admitted, the South African minority government fell peacefully.

Ahmadinejad was forced again to explain that when he quoted Ayatollah Khomeini to the effect that “this occupation regime over Jerusalem must vanish from the page of time,” he did not mean that “Israel must be wiped off the face of the map” (as the quotation was mistranslated). He told King Tuesday night that he meant that the Israeli state’s policies of committing crimes against the Palestinians and killing them and occupying them must vanish. He added, “Our solution is in fact a completely humane and democratic one. What we’re saying is that throughout the Palestinian territories [i.e., including Israel and the occupied territories], people should gather and determine the type of government they would like to have.” In other words, he says he means by the vanishing of the regime a single democratically elected state in Israel and Palestine.

Committed Zionists, that is to say, Jewish nationalists, who believe that Israel must remain a Jewish-majority state, often see the advocacy of a one-state solution (in which Israeli Jews might be reduced to a simple majority or even only a plurality of the population) as a dire threat to the Jewish people. They are also known to smear anyone who demurs from their rigid conception of nationalism as an anti-Semite or even a terrorist. However, neither their conviction that any criticism of Israel must be prohibited, nor their insistence on a state dominated by a single ethnicity, nor their often unpleasant tactics of the destruction of reputations should stand in the way of Americans seeking an unblinkered understanding of contemporary Iran and pursuing American interests in regard to relations with Tehran.

It is legitimate to question the truthfulness of Iranian assertions about the character of their nuclear energy research program. It is a wise policy to pressure Tehran to allow even more rigorous inspections, to permit surprise inspections, and to explain just what the country was up to before early 2003. Scaled sanctions to get Iran to give up its enrichment program altogether might work if these sticks were combined with more carrots. The Iranian regime has made numerous hateful comments about Israel and is hostile to the Zionist state, and it is natural that this rhetoric should make the Israelis nervous. A reason for caution, watchfulness and deterrence, however, is not necessarily grounds for war. The United States faced down the Soviet Union without ever having gone directly to war against it, after all.

But to distort the colorful Ahmadinejad’s words, to mistranslate him, to misrepresent him as in control of the Iranian military, or to pretend that he represents a consensus in the Iranian political elite is to build a fantasy world as insubstantial and whimsical as a SimCity computer game. Larry King got at the true Ahmadinejad, with all his flaws, more accurately and extensively than anything else on American television or in political rhetoric. It is clear that for the U.S. to go to war over an imaginary threat of genocide (Iran does not have the ability to kill large numbers of Israelis and consistently denies that it wants to) at a time when its military is overstretched by two protracted guerrilla wars, when its financial system is near collapse, and when the resulting run-up in oil prices would cripple the U.S. and world economies would be a folly so great that only a lunatic would contemplate it. As foolish and hateful as Ahmadinejad can be, it remains to be seen if we are any better.

Source / Salon

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Barbara Ehrenreich : How Positive Thinking Wrecked the Economy

Posted on September 25, 2008 by Thorne Dreyer


Greed: The Little Engine that Couldn’t
By Barbara Ehrenreich / September 24, 2008

Greed – and its crafty sibling, speculation – are the designated culprits for the ongoing financial crisis, but another, much admired, habit of mind should get its share of the blame: the delusional optimism of mainstream, all-American, positive thinking. As promoted by Oprah, scores of megachurch pastors, and an endless flow of self-help bestsellers, the idea is to firmly belief that you will get what you want, not only because it will make you feel better to do so, but because thinking things, “visualizing” them – ardently and with concentration – actually makes them happen. You will be able to pay that adjustable rate mortgage or, at the other end of the transaction, turn thousands of bad mortgages into giga-profits, the reasoning goes, if only you truly believe that you can.

Positive thinking is endemic to American culture – from weight loss programs to cancer support groups – and in the last two decades it put down deep roots in the corporate world as well. Everyone knows that you won’t get a job paying more than $15 an hour unless you’re a “positive person” — doubt-free, uncritical, and smiling—and no one becomes a CEO by issuing warnings of possible disaster. According to a rare skeptic, a Washington-based crisis management consultant I interviewed on the eve of the credit meltdown in 2007, even the magical idea that you can have whatever you truly want has been “viral” in the business culture. All the tomes in airport bookstores’ business sections scream out against “negativity” and advise the reader to be at all times upbeat, optimistic and brimming with confidence—a message companies relentlessly reinforced by treating their white collar employees to manic motivational speakers and revival-like motivational events. The top guys, meanwhile, would go off to get pumped up in exotic locales with the likes of success guru Tony Robbins. Those who still failed to get with the program could be subjected to personal “coaching” or of course, shown to the door.

The same frothy wave of mandatory optimism swept through the once-sober finance industry. On their websites, scores of motivational speakers proudly list companies like Lehman Brothers and Merrill Lynch among their clients. Angelo Mozilo, the former CEO of Countrywide Mortgage whose subprime ventures precipitated the entire crisis, was known for his congenital optimism and described in the Guardian earlier this year as “absurdly upbeat” even as his industry unraveled. No one was psychologically prepared for hard times, when they hit, because, according to the tenets of positive thinking, even to think of trouble is to bring it on. In May, the New York Times reported that Merrill, caught up short, was suddenly trying to “temper the Pollyannas in its ranks,” and force its analysts to occasionally say the word “sell.”

For those at the very top of the corporate hierarchy, all this positive thinking must not have seemed delusional at all. They actually could have almost anything they wanted, just by expressing the desire. CEO compensation has ballooned in recent years, creating the new class of billionaires and centi-millionaires who inhabit Lear jets and four-figure a night hotel rooms, who can dispatch a private plane who pick up a favorite wine, or a pet, they happen to have left in the Hamptons. According to a new book from the UK, Unjust Rewards by Polly Toynbee and David Walker, these masters of the universe tend to be seriously uninformed about how the other 99 percent lives and, Toynbee told me, often uncomprehending of the financial operations – the derivatives, CDS’s, etc. – that their wealth is derived from. If you live in a bubble of perfect wish-fulfillment, how could you imagine that, for example, some poor fellow in Cleveland might run up against unexpected medical bills or car problems that could waylay his mortgage payments?

Americans did not start out as deluded optimists. The original ethos, at least of white Protestant settlers and their descendents, was a grim Calvinism that offered wealth only through hard work and savings, and even then made no promises at all. You might work hard and still fail; you certainly wouldn’t get anywhere by adjusting your attitude or dreamily “visualizing” success. Calvinists thought “negatively” as we would say today, carrying a weight of guilt and foreboding that sometimes broke their spirits. It was in response to this harsh ethos that positive thinking arose– among mystics, lay healers, and transcendentalists – in the 19th century, with its crowd-pleasing message that God, or the universe, is really on your side, that you can actually have whatever you want, if the wanting is focused enough.

When it comes to how we think, “negative” is not the only alternative to “positive.” As the case histories of depressives show, consistent pessimism can be just as baseless and deluded as its opposite. The alternative to both is realism – seeing the risks, having the courage to bear bad news, and being prepared for famine as well as plenty. Now, with our savings, our homes and our livelihoods on the line, we ought to give it a try.

[A shorter version of ths article appeared in The New York Times, September 24, 2008.]

Source / Barbara’s Blog

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Jim Hightower : Banking Jobs on the Move (Overseas)

Posted on September 25, 2008 by Thorne Dreyer


‘These powerhouse bankers – who profit enormously from America’s people, laws, protections, and subsidies – no longer feel any responsibility for providing good American jobs’
By Jim Hightower / September 25, 2008

Let’s hear it for Citigroup, Goldman Sachs, Morgan Stanley, and other Wall Street banks that are opening up tens of thousands of new, well-paying jobs for researchers and analysts!

Unfortunately, the jobs are in India, the Philippines, and Eastern Europe, with many also headed to China. These powerhouse bankers – who profit enormously from America’s people, laws, protections, and subsidies – no longer feel any responsibility for providing good American jobs. Indeed, they are likely to offshore some 40 percent of their research-related jobs, cutting about 200,000 U.S. employees this year alone.

Banks are not letting their executives talk to the media about this, hoping that We the People won’t notice that these high-quality positions for America’s college graduates have gone bye-bye. They even have euphemisms for their actions, saying that the cuts should not be called offshoring, but “reengineering” of their workforce.

Call it what they will, the demise of banking jobs is moving higher up the organizational charts, including upper-level executives in charge of product development, trading, and sales. The banking job trickle out of America has become a flood. So much so that outsourcing firms in India like to joke that the only role for top bankers in the U.S. will be to greet clients and shake hands when the deal is done. Only, it no longer seems to be a joke.

The Wall Street giants get foreign employees to whom they can pay a fraction of American salaries. But what does our society get? The products and services are not improved, nor are they cheaper – the labor savings are not passed on to customers, but pocketed by those at the top. It further widens the disparity between the very wealthy and the rest of us, weakening America’s economy and undermining our democratic ideals.

If Wall Street doesn’t give a damn about Americans, why should America be underwriting Wall Street?

[“…India’s Role Is Growing,” The New York Times, August 12, 2008.]

Source / Jim Hightower

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BOOKS : ‘American Wife’ is based on Laura Bush

Posted on September 25, 2008 by Thorne Dreyer


‘Imagine marital bliss with a man who farts often and calls it “tooting his own horn”’
By Cathy Matusow / September 24, 2008

What’s it like to be married to George W. Bush? Imagine marital bliss with a man who farts often and calls it “tooting his own horn,” enjoys his whiskey and the occasional snort, has skills in the oral sex department and is overly concerned with his “legacy.” This is Charlie Blackwell, a fictional Bush, as presented by Curtis Sittenfeld in her excellent novel American Wife, narrated by his wife Alice, loosely based on Laura.

Sittenfeld’s novel is inspired by the basic facts of Laura Bush’s life — her love of reading, her career as a librarian, her meeting the future president at a backyard barbecue — and her husband’s rise to the presidency; she fictionalizes the rest.

The most painful part of Laura’s biography involves the car accident she was involved in as a teenager, when she ran a stop sign and accidentally killed a classmate. It has been said that Laura was romantically involved with the boy. In the novel, Alice is in love with him – feels sure that they will end up together. The incident explains a lot about the character of Alice, who feels conflicted about the good things that come to her later. It’s also a major plot point, as the tragedy indirectly leads to a terminated pregnancy, with all the implications that would have for the wife of a right-wing president.

In the novel, Alice is a registered Democrat when she meets Charlie, but after she marries him, she basically agrees not to air her views publicly. Laura Bush is known as a conservative Republican, of course. But she also has said she thought Roe v. Wade should not be overturned and that gay marriage should not be “used as a campaign tool.” Both abortion rights and the acceptance of homosexuality loom large in the novel.

Alice is a likeable character, certainly. She is thoughtful, wise, intellectual, fair-minded and charitable, if a tad martyrish. She’s also beautiful. Like Laura, she enjoys far greater poll numbers than her husband. The question is, why does she marry Charlie? His own icy mother tells Alice she married down when she linked her fate to Charlie’s.

“Oh no, Chas married up,” says Alice’s mother-in-law. “Why, Alice, he was as a thirty-one-year-old wastrel, making that preposterous congressional run, no less, and he was dating waitresses. We couldn’t imagine what you saw in him!”

Perhaps this is why Alice falls for him: “He always wanted to snuggle, he even used the word snuggle, which I’d never heard a man do.” Alice is a sucker for Charlie’s boyish confidence and charm. When she’s going to introduce Charlie to her family, Alice tells him to behave himself. He responds, “I shouldn’t ask your grandma to pull my finger?”

Sittenfeld is one of the best writers out there. If you skipped her novel Prep because it was packaged like chick lit, you made a mistake. She’s excellent at creating nuanced characters and a master of detail. Her novels just feel real. I found myself believing that Alice was Laura and Charlie was George, which is ridiculous, of course.

And yet…Alice’s explanation for the Republican administration’s stubbornness about the Iraq War is as good as any. Alice remembers excusing herself at a dinner to go to the ladies’ and, while looking for the door, accidentally reentering the dining room. “The logical thing at that point would have been to turn around, but I felt self-conscious,” she says. “I was unaccustomed to country clubs, I imagined the women in the anteroom would notice and think me silly, and so, with a full bladder, I rejoined Charlie and didn’t urinate until we arrived home over an hour later.”

In the same way, Charlie has continued along the path he’s somehow ended up on, pushing the war on the American people – with an important difference, Alice observes: “…that night at the club, when I need to urinate and hadn’t, the only one who suffered for my foolishness was me.”

Source / Houston Press

Find American Wife on Amazon.com

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You Gotta Be Able to Laugh at Yourself …

Posted on September 25, 2008 by RagBlog


Nominated As the World’s Best Short Joke of the Year

A 3-year-old boy examined his testicles while taking a bath.

‘Mom’, he asked, ‘Are these my brains?’

‘Not yet,’ she replied.

Thanks to Ned Salman / The Rag Blog

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What’s Wrong with This Picture?

Posted on September 25, 2008 by RagBlog


Forbes publishes list of 400 wealthiest Americans
By Tom Eley / September 24, 2008

Even as the US careens into its greatest economic calamity since the Great Depression, the financial aristocracy whose parasitism and criminality has brought on the crisis has held its own—and then some.

The recently released Forbes 400 list of the richest Americans shows that the combined wealth of the aristocracy has increased 2 percent, even amidst the financial breakdown and recession of the economy. “In this, the 27th edition of the list,” Forbes glumly notes, “the assembled net worth of America’s wealthiest rose by $30 billion — only 2% — to $1.57 trillion.”

Readers will be forgiven for tripping over the word “only” in relationship to a $30 billion increase in wealth for 400 spectacularly wealthy individuals. This “modest” figure—the increase in wealth for the oligarchy in a bad year—is only slightly less than the federal government has budgeted for unemployment insurance for all of 2008.

The overall wealth of the 400 richest Americans is staggering. There are no multimillionaires on the list; a minimum of $1.3 billion being required to gain admittance, while the average net worth is $3.9 billion.

The combined wealth of the richest 400 individuals is $400 billion more than the entire discretionary spending budget for the federal government. It is more than $300 billion larger than the combined 2008 outlay for Social Security, Medicare, and Medicaid. It is more than 15 times the combined appropriations for education and highways and mass transit.

The personal wealth of the top 400 Americans is more than twice the combined annual GDP of all of sub-Saharan Africa, home to nearly 800 million people, the vast majority of whom live in dire conditions. It is also several hundred billion dollars larger than the GDP of the world’s eighth biggest economy, that of Spain.

The club’s richest member is Microsoft magnate Bill Gates, whose net worth, $57 billion, is greater than the annual GDP of about 120 of the world’s 180 nations.

The year’s biggest winner is New York City Mayor Michael Bloomberg, whose personal wealth increased by $8.5 billion to $20 billion, making Bloomberg the nation’s eighth richest individual.

On Tuesday, without a hint of irony—much less shame—Mayor Bloomberg proposed brutal across-the-board budget cuts for the city of New York. He is calling for cutbacks totaling $500 million for the current fiscal year, to be followed by much steeper cuts in the coming years. Meanwhile Bloomberg, in the course of just one year, pocketed 17 times what he is now demanding that millions of working people in New York City forfeit in terms of vital services and jobs. Only in America!

However, owing to the turbulence of the stock market, great fortunes were being both made and squandered even as Forbes published its list. “The Forbes 400 is a snapshot of estimated wealth on Aug. 29, 2008, the day we locked in prices of publicly traded stocks,” the magazine wrote. “Given how unsettled the stock market is, some of those on our list will become significantly richer or poorer within weeks—even days—of publication. Many, including AIG shareholders Eli Broad and Steven Udvar-Hazy, have lost hundreds of millions of dollars.”

Becoming poorer is of course a relative process; we can be certain that none of the demoted oligarchs faces hunger.

Among this year’s biggest “losers”—and there is a degree of poetic justice in this—are casino moguls. Kirk Kerkorian has managed to squander $6.8 billion of ill-gotten social wealth, while the fortune of his rival Sheldon Adelson “has fallen $13 billion in the past 12 months—$1.5 million per hour.” Adelson has managed to lose more in an hour than most US workers will earn in a lifetime.

That the nation’s financial aristocracy continues to gorge itself even as the economy stagnates demonstrates the increasing parasitism of the elite. The wealth of the super-rich is no longer bound up with the growth of the real economy, as it was in the days of Carnegie, Rockefeller, and Ford. Just the opposite is the case. The wealth of the aristocracy is based on the plundering and destruction of the real economy.

A perusal of the basis of the Forbes 400 members’ wealth illustrates the parasitic nature of US capitalism. The largest two categories on the list are “finance” with 65 members and “investments” with 51. Among the “sources” Forbes lists for these categories are “leveraged buyouts,” “investments,” “hedge funds,” “money management,” and “banking, insurance.”

The next largest category is “media/entertainment,” with 36 representatives among the Fortune 400, followed by the 35 members in the highly toxic “real estate” category. There are 30 members of the Fortune 400 who have reaped their fortunes from “technology,” almost all from Internet ventures or computer technology. Twenty-eight more are found in the “oil/gas” category.

Among the Fortune 400 there are 20 in the “retail” group, among them seven members of the Walton clan, owners of Wal-Mart, who collectively have assets of over $100 billion.

It has to be asked: Are there any members of the Forbes 400 actually associated with producing commodities or creating wealth of some sort?

There are only 19 members of the 400 in the category called “manufacturing.” However, upon inspection we see that this group is comprised of corporate raiders, oil refiners, inheritors, and controllers of holding companies. Only five members of this classification are actually associated with producing a commodity—and four of these produce light consumer goods.

Likewise, there are only 11 members of the financial aristocracy whose wealth has been associated with commodity production in the agricultural sector. But among these, nine are inheritors of the Cargill fortune. Of the other two, one has gained his fortune selling discount cigarettes; another by producing pesticides in Argentina.

There are nine members of the group in the “apparel” category, which is split between those whose wealth has come from retail sales, such as the owners of the Gap clothing stores, and those who have made windfalls by producing consumer goods in low-cost countries and selling the products for inflated prices in the US, such as Phil Knight of Nike.

There is only one member of the “construction/engineering” category, the 321st richest American, Alfred Clark, who has made his fortune by building sports stadiums. The “food” category, of which there are 21 members, is divided among retailers, inheritors, and the owners of single product lines, including the owner of the Slim-Fast empire. There are only three members of the “shipping/trucking/transport” category, and one member of “mining/lumber” (whose wealth came from overseas ventures).

In short, the incredible fortunes accumulated by the American elite have precious little to do with socially useful production. On the contrary, the financial aristocracy has reaped its obscene piles of wealth from the gutting of infrastructure, the shuttering of industrial production, and the impoverishment of working people, the broad mass of the population.

Copyright 1998-2008 World Socialist Web Site – All rights reserved

Source / World Socialist Web Site

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The Logical Conclusion to Deregulating the Markets

Posted on September 25, 2008 by RagBlog


Has Deregulation Sired Fascism?
By Paul Craig Roberts / September 24, 2008

Remember the good old days when the economic threat was mere recession? The Federal Reserve would encourage the economy with low interest rates until the economy overheated. Prices would rise, and unions would strike for higher benefits. Then the Fed would put on the brakes by raising interest rates. Money supply growth would fall. Inventories would grow, and layoffs would result. When the economy cooled down, the cycle would start over.

The nice thing about 20th century recessions was that the jobs returned when the Federal Reserve lowered interest rates and consumer demand increased. In the 21st century, the jobs that have been moved offshore do not come back. More than three million U.S. manufacturing jobs have been lost while Bush was in the White House. Those jobs represent consumer income and career opportunities that America will never see again.

In the 21st century the US economy has produced net new jobs only in low paid domestic services, such as waitresses, bartenders, hospital orderlies, and retail clerks. The kind of jobs that provided ladders of upward mobility into the middle class are being exported abroad or filled by foreigners brought in on work visas. Today when you purchase an American name brand, you are supporting economic growth and consumer incomes in China and Indonesia, not in Detroit and Cincinnati.

In the 20th century, economic growth resulted from improved technologies, new investment, and increases in labor productivity, which raised consumers’ incomes and purchasing power. In contrast, in the 21st century, economic growth has resulted from debt expansion.

Most Americans have experienced little, if any, income growth in the 21st century. Instead, consumers have kept the economy going by maxing out their credit cards and refinancing their mortgages in order to consume the equity in their homes.

The income gains of the 21st century have gone to corporate chief executives, shareholders of offshoring corporations, and financial corporations.

By replacing $20 an hour U.S. labor with $1 an hour Chinese labor, the profits of U.S. offshoring corporations have boomed, thus driving up share prices and “performance” bonuses for corporate CEOs. With Bush/Cheney, the Republicans have resurrected their policy of favoring the rich over the poor. John McCain captured today’s high income class with his quip that you are middle class if you have an annual income less than $5 million.

Financial companies have made enormous profits by securitizing income flows from unknown risks and selling asset backed securities to pension funds and investors at home and abroad.

Today recession is only a small part of the threat that we face. Financial deregulation, Alan Greenspan’s low interest rates, and the belief that the market was the best regulator of risks, have created a highly leveraged pyramid of risk without adequate capital or collateral to back the risk. Consequently, a wide variety of financial institutions are threatened with insolvency, threatening a collapse comparable to the bank failures that shrank the supply of money and credit and produced the Great Depression.

Washington has been slow to recognize the current problem. A millstone around the neck of every financial institution is the mark-to-market rule, an ill-advised “reform” from a previous crisis that was blamed on fraudulent accounting that over-valued assets on the books. As a result, today institutions have to value their assets at current market value.

In the current crisis the rule has turned out to be a curse. Asset backed securities, such as collateralized mortgage obligations, faced their first market pricing in panicked circumstances. The owner of a bond backed by 1,000 mortgages doesn’t know how many of the mortgages are good and how many are bad. The uncertainty erodes the value of the bond.

If significant amounts of such untested securities are on the balance sheet, insolvency rears its ugly head. The bonds get dumped in order to realize some part of their value. Merrill Lynch sold its asset backed securities for twenty cents on the dollar, although it is unlikely that 80 percent of the instruments were worthless.

The mark to market rule, together with the suspect values of the asset backed securities and collateral debt obligations and swaps, allowed short sellers to make fortunes by driving down the share prices of the investment banks, thus worsening the crisis. With their capitalization shrinking, the investment banks could no longer borrow. The authorities took their time in halting short-selling, and short-selling is set to resume on October 3 or thereabout.

If the mark to market rule had been suspended and short-selling prohibited, the crisis would have been mitigated. Instead, the crisis intensified, provoking the US Treasury to propose to take responsibility for $700 billion more in troubled financial instruments in addition to the Fannie Mae, Freddie Mac, and AIG bailouts. Treasury guarantees are also apparently being extended to money market funds.

All of this makes sense at a certain level. But what if the $700 billion doesn’t stem the tide and another $700 billion is needed? At what point does the Treasury’s assumption of liabilities erode its own credit standing?

This crisis comes at the worst possible time. Gratuitous wars and military spending in pursuit of US world hegemony have inflated the federal budget deficit, which recession is further enlarging. Massive trade deficits, magnified by the offshoring of goods and services, cannot be eliminated by US export capability.

These large deficits are financed by foreigners, and foreign unease has resulted in a decline in the US dollar’s value compared to other tradable currencies, precious metals, and oil.

The US Treasury does not have $700 billion on hand with which to buy the troubled assets from the troubled institutions. The Treasury will have to borrow the $700 billion from abroad.

The dependency of Treasury Secretary Paulson’s bailout scheme on foreign willingness to absorb more Treasury paper in order that the Treasury has the money to bail out the troubled institutions is heavy proof that the US is in a financially dependent position that is inconsistent with that of America’s “superpower” status.

The US is not a superpower. The US is a financially dependent country that foreign lenders can close down at will.

Washington still hasn’t learned this. American hubris can lead the administration and Congress into a bailout solution that the rest of the world, which has to finance it, might not accept.

Currently, the fight between the administration and Congress over the bailout is whether the bailout will include the Democrats’ poor constituencies as well as the Republicans’ rich ones. The Republicans, for the most part, and their media shills are doing their best to exclude the ordinary American from the rescue plan.

A less appreciated feature of Paulson’s bailout plan is his demand for freedom from accountability. Congress balked at Paulson’s demand that the executive branch’s conduct of the bailout be non-reviewable by Congress or the courts: “Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion.” However, Congress substituted for its own authority a “board” that possibly will consist of the bailed out parties, by which I mean Republican and Democratic constituencies. The control over the financial system that the bailout would give to the executive branch would mean, in effect, state capitalism or fascism.

If we add state capitalism to the Bush administration’s success in eroding both the US Constitution and the power of Congress, we may be witnessing the final death of accountable constitutional government.

The US might also be on the verge of a decision by foreign lenders to cease financing a country that claims to be a hegemonic power with the right and the virtue to impose its will on the rest of the world. The US is able to be at war in Iraq and Afghanistan and is able to pick fights with Iran, Pakistan and Russia, because the Chinese, the Japanese and the sovereign wealth funds of the oil kingdoms finance America’s wars and military budgets. Aside from nuclear weapons, which are also in the hands of other countries, the US has no assets of its own with which to pursue its control over the world.

The US cannot be a hegemonic power without foreign financing. All indications are that the rest of the world is tiring of US arrogance.

If the US Treasury’s assumption of bailout responsibilities becomes excessive, the US dollar will lose its reserve currency role. The minute that occurs, foreign financing of America’s twin deficits will cease, as will the bailout. The US government would have to turn to the printing of paper money as did Weimar Germany.

For now this pending problem is hidden from view, because in times of panic, the tradition is to flee into “safety,” that is, into US Treasury debt obligations. The safety of Treasuries will be revealed by the extent of the bailout.

Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan administration. He was Associate Editor of the Wall Street Journal editorial page and Contributing Editor of National Review. He is coauthor of The Tyranny of Good Intentions. He can be reached at: PaulCraigRoberts@yahoo.com.

Source / Information Clearing House

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Ann Wright: A Voice of Reasonable Dissent

Posted on September 25, 2008 by RagBlog

Retired Col. Ann Wright was one of three U.S. diplomats to resign in protest over the American invasion of Iraq in 2003.

Retired soldier now in fight against war in Iraq
By Bill Sizemore / September 24, 2008

NORFOLK – For Ann Wright, it’s a badge of honor that Fox News host Bill O’Reilly once cut off her microphone midinterview.

“He was questioning my patriotism,” Wright said in an interview this week. “All I had said was that the United States needed to follow the Geneva Conventions in its treatment of prisoners. I said, ‘Bill, I was in the military 29 years and I was a diplomat for 16 years. What have you done for the country?’ “

Presumably Wright, 61, won’t have to worry about being cut off when she speaks tonight at the Naro Expanded Cinema about her unlikely odyssey from soldier to diplomat to full-time anti-war activist.

By her own description, hers was a “squeaky clean” life story. She grew up in Bentonville, Ark., where she was a Girl Scout and her father was a banker who gave Sam Walton a loan that helped launch the Wal-Mart empire.

After retiring from the Army as a colonel, she joined the State Department and served in a variety of overseas posts, including reopening the U.S. Embassy in Kabul, Afghanistan, after the 2001 terrorist attacks.

Over the decades, she said, she had often disagreed privately with U.S. policy but kept her mouth shut, believing she could serve best within the system.

“But it all changed when President Bush decided that he would invade and occupy an oil-rich Arab Muslim country that had not attacked the United States,” she said. “It was such a dangerous move for the United States that I felt I could not be a part of it.”

Wright was one of three U.S. diplomats to resign in protest over the American invasion of Iraq in 2003.

Since then she has been arrested 15 times for raising her voice in a public and indelicate manner. Once, after lecturing the Senate Foreign Relations Committee from the gallery, she was sentenced to three days in jail.

Wright has co-written a book, “Dissent: Voices of Conscience,” a collection of profiles of men and women in government who have publicly criticized the Bush administration’s foreign policy.

Appearing with Wright tonight will be Jonathan Hutto, a sailor and co-founder of Appeal for Redress, an organization that encourages active-duty personnel who are against the war in Iraq to speak out.

Source / Virginian-Pilot

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Turning to High-Tech to See Through the Economic Mess

Posted on September 25, 2008 by Thorne Dreyer

Fighter pilot helmet with x-ray vision — to see through those marble walls! And that ain’t nothin, honey.

Using 21st century anti-insurgency technology to prevent the next stock market meltdown
By Doug Porter / September 23, 2008

The Washington Post and the Los Angeles Times have both run stories in the past few weeks referring to new super secret technologies being used by the US military that have contributed significantly to the decline in violence in the war in Iraq . Both papers have only made fleeting references to the methodologies involved, citing concerns that foreign governments/terrorists will use any disclosures to development counter-technologies that will negate the advantages that these new super secret technologies give the US military.

To quote the Times,

“American officials requested that details of the new technology not be disclosed out of concern that doing so might enable militants to evade U.S. detection. But officials said the previously unacknowledged devices have become a powerful part of the American arsenal, allowing the tracking of human targets even when they are inside buildings or otherwise hidden from Predator surveillance cameras.”

Whenever the press says something is “super secret”, I utilize my own private technology (aka Google) to gain enlightenment. It’s a good thing that foreign governments/terrorists haven’t figured this out, except that they have. The Chinese government has already stolen the basic drone technology, and there are numerous references around the web to the techniques that have made these weapons so effective.

Without revealing any more secrets than Google provided in three basic searches, let’s look at the some of the basic technology in use:

** The ability to see through walls: Known by its acronym (STTW), a several year old report from the National Defense University cites a system that can “detect the presence of personnel within rooms (stated to be doing well through 12 inches of concrete),” as well as a commercially developed system with a “30-foot standoff capability.” STTW is new application of radar technologies. Intensive R&D has reduced the size of the equipment to about the same size as an automotive battery, although it is apparently very heavy, as its utilization reduces the amount of weaponry that Predator drones can carry.

** By combining the STTW technology with distributed sensors and utilizing marching cubes, a computer graphics algorithm utilized for MIR and CT scan images, it is now possible to create three dimensional images. The effect of these devices, according to a former U.S. military official interviewed by the Times, is that insurgents, even indoors, “are living with a red dot on their head.”

** Last, there have been significant advances in military SIGINT programs. (That’s Signals Intelligence) These breakthroughs are enabling the military to gain intelligence based on the “signatures” of various communication devices. It’s all terribly triple secret, and if I were to explain any more here, I’d have to shoot you.

There is undoubtedly more to all this “super secret” stuff than the government has been willing to leak to the press. If Cold War History can be used as a reliable model, most of the world’s intelligence services and a great many insurgent groups will have all the gory details long before the American public gains access to this information. The “SECRET” stamp means that moral, legal, or financial questions about the utilization of this technology can and will be effectively avoided behind the twin shields of National Security and the War on Terrorism.

AND , it also means some technologies that the military has developed for battlefield use in the various middle east/ near east conflicts will likely (if they haven’t already) be allowed to “trickle down” for domestic use. Of course, because the technologies are all secret, there will be no legal, moral, or ethical standards in place governing their use. Our friends from the north (aka Canada ) have been playing with this stuff for years and are pretty honest about its potential for domestic use.

So, let’s get to the point. The government has X-Ray Glasses technology, can leap tall buildings with a single bound (or hover over them for hours, as needed) and can pretty much get to all your vital secrets using your cell phone, Blackberry, automotive GPS and probably even your iPod. Members of both political parties, a gaggle of pundits and even the President agree that we have a “national crisis” going on at present on Wall Street that threatens the very foundations of our Nationhood. It’s a short leap from National Crisis to National Security—if the country’s broke, how are we gonna pay for more wars?

It’s time to bring the technology that’s been so useful in Iraq home and put it to use Saving Our Economy. In the past, these kinds of military programs have been used for spying on domestic dissenters and the occasional criminal conspiracy. Now it’s time to step up to the plate and hit a homer. The government can spare us the details, if they like–just give us the facts. Wouldn’t it be in America ’s best interest to know when Treasury Secretary Paulson and his ilk were selling off all the “assets” for deeply discounted prices that our tax dollars have recently acquired? Wouldn’t this be the ultimate oversight? Wouldn’t it be terrific if all the CEO Blackberries suddenly began spewing out insider info for all to share?

Just a thought.

Source / OB Rag

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McCain Cancels, Letterman Pissed!

Posted on September 24, 2008 by Thorne Dreyer

Letterman: ‘I’ll find him.’ Photo © James Devaney, WireImage.com.

Letterman says McCain’s disappearing act not funny
By Bill Carter / September 24, 2008

See Video Below.

Senator John McCain may have disappointed many expectant voters and debate viewers with the decision to suspend his campaign, but none more so than a late-night talk show host on CBS.

David Letterman was so unhappy that Mr. McCain canceled his scheduled appearance on his show Wednesday night that he spent much of the first segment assailing the senator’s decision and suggesting “something doesn’t smell right” about the Senator’s plan to go to Washington to work on the financial crisis.

Mr. Letterman told his audience that Senator McCain had called him directly on short notice Wednesday, to tell him he had to cancel his appearance. After expressing his admiration for Mr. McCain and his sacrifice as a prisoner of war in Vietnam, Mr. Letterman said, “When you all up at the last minute and cancel, that’s not the John McCain I know.” He repeated that “something smells right now” and he suggested “somebody must have put something in his Metamucil.”

Mr. Letterman said Mr. McCain had said the economy was “about to crater” which necessitated that he get to Washington right away. Mr. Letterman then suggested that McCain should not be suspending his campaign at all and that he could have “sent in the second-string quarterback,” his vice presidential running mate, Gov. Sarah Palin of Alaska, to fill in for him. “You don’t quit,” Mr. Letterman said.

After suggesting that Ms. Palin should be prepared to step up and “be ready,” because “the poor guy is getting a little older,” Mr. Letterman reconsidered and said of Ms. Palin’s readiness, “Don’t get me started.”

Even after Mr. Letterman brought out Keith Olbermann, the MSNBC host and vituperative Republican critic as the substitute guest for Mr. McCain, he continued to assail Mr. McCain for the decision to cancel the appearance. His critique reached a high point when he learned that at the very moment Mr. McCain was supposed to be on the couch next to him being interviewed, the senator was at the CBS News center three blocks away in Manhattan, getting ready to be interviewed by the CBS News anchor, Katie Couric.

Mr. Letterman ordered his director to put on a live feed from that location, which showed Mr. McCain getting made up to go on with Ms. Couric. “He doesn’t seem to be racing to the airport,” Mr. Letterman observed.

After listening to some questions from Ms. Couric, Mr. Letterman said, “Hey, John, I’ve got a question: You need a lift to the airport?”

He then asked Mr. Olbermann if he thought this was all Mr. McCain’s fault, or whether other factors had come into play.

“He ditched you,” Mr. Olbermann said.

Source / The Caucus / New York Times Political Blog

David Letterman Reacts to John McCain Suspending Campaign

Thanks to Harry Edwards / The Rag Blog

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Tom Hayden : No Deal. We Need Economic Democracy

Posted on September 24, 2008 by Thorne Dreyer


The bailout, the election, and new hope for the left
By Tom Hayden / September 24, 2008

The proposed Wall Street bailout is the ultimate lipstick on a pig. Progressives should oppose it, no matter the cosmetics. I speak as a 20-year veteran of electoral politics, not an economist, when I say there is no way this Congress and the White House can agree on any reforms commensurate with the scale of the $700 billion theft.

This is a plan that Mussolini could have written.

What Barack Obama himself should do is a different matter. He has a track record of proposing greater regulation of Wall Street starting before the current crisis. He would like to appear “responsible” during and let McCain’s long record of deregulatory mania going back to the Keating scandal speak for itself. But Obama, in being too cool, may allow McCain to reinforce his “maverick” status by taking the more populist position.

This is about the presidency, not only the economy.

Progressives should say No to this deal and begin a new phase in building a real progressive movement and more populist Democratic Party in the direction of economic democracy.

On Iraq, progressives have succeeded in discrediting the neo-conservatives, centrist Democrats, and humanitarian hawks. Public opinion in general, and 85 percent of Democratic voters, are with us.

For those same five years, we have had a harder time winning the economic argument. But we have succeeded in blocking the momentum of the WTO, especially towards Latin America, and turned many Democratic politicians against corporate trade policies. The public is with us on protecting Social Security and repealing tax cuts for the rich as well. The trouble has been challenging the core notion behind privatization and deregulation, that is, the myth of the “free market”, trusting private banks and corporations, the geese that lay the golden eggs, to invest in the common good. Everywhere you look today, the trend is towards private financing of schools, colleges, economic development, political conventions, sports teams, even thousands of non-governmental organizations, including progressive ones. Treasury Secretary Paulson, for instance, just became chairman of the board of the Nature Conservancy, threading their futures together. The public sector declines while inequalities grow. Regulations are stripped away.

Many have lost the way from the principles of the Populists, Progressives, Socialists and New Dealers. Those political ancestors saved capitalism in their own ways, but at least they believed in a strong, growing public sector to assert the public good where markets failed. They put more than lipstick on the pig. Collective bargaining, social security, public utilities, regulation of banks and corporations, and the direct election of senators were a few of the reforms that resulted in those eras.

Today the Democrats are looking for the minimum concessions that will help them cave. Since the Clinton era, or perhaps really the Carter era, progressive economic thinking in the Democratic Party has been narrowed to the choices of lipstick again and again. They are incapable of saying No, even to the greatest stick up in the history of our economy. This is the “shock treatment” explained by Naomi Klein, in full view.

Bush and McCain will be satisfied this week if the Democrats win Congressional oversight, modest re-regulation, and perhaps limits on compensation for the executives who are to blame for the catastrophe.

But given the political situation, there is no possibility of any package of concessions that comes near the magnitude of the theft.

For the moment there is little that serious progressives can do, unless – and this is my hope – people unexpectedly go into the streets. But we should realize and drive home the argument that free markets are a faith-based lie, that privatization is greed without fetters, that the public sector must be restored to the role of defending the public interest. The two grand strategies of the empire – militarization and privatization – are failing everywhere from Pakistan to Bolivia. The space is wide open for a populist, progressive, anti-war agenda, rising from below.

Source / Progressives for Obama

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John McCain Is Just Another Routine Liar

Posted on September 24, 2008 by RagBlog

Davis and McCain – but are they going up or down?

The biggest story of the campaign
By Michael Tomasky / September 24, 2008

Mark this day down. Today – last night, actually – the New York Times and Roll Call reported (it’s hard to see who was first) what may be the biggest political story of the campaign. How big? John McCain might have to fire his campaign manager. Big enough?

The story is this. The lobbying firm of Rick Davis, the manager, was being paid $15,000 a month by Freddie Mac until last month. That fact is a direct contradiction of words McCain had spoken Sunday night. At that time, responding to a Times story being prepared for Monday’s paper revealing that Davis had been the head of a lobbying consortium led by Freddie Mac and Fannie Mae until 2005, McCain said Davis had done no further work for either mortgage giant.

Someone’s lying – either Davis to McCain, or McCain to the public. I trust you see the problem here.

The stories are here, by David Kirkpatrick (whose reporting on this topic has been leading the way) and Jackie Calmes of the Times, and here, by Tory Newmeyer of Roll Call. You should definitely read every word of both. I think after you do you’ll agree that, depending on how big the pick-up is today and how hard the Obama camp presses this, it’s pretty difficult to see how Davis can stay on as campaign manager.

The revelations are devastating for two reasons. First, as I noted above, either Davis lied to McCain or McCain lied to the voters. From the Times story:

On Sunday, in an interview with CNBC and The Times, Mr. McCain responded to a question about that tie between Mr. Davis and the two mortgage companies by saying that he “has had nothing to do with it since, and I’ll be glad to have his record examined by anybody who wants to look at it.”

Who lied to whom? This is the kind of thing we might not know for a while, or maybe never. My hunch would be that Davis concealed it from McCain and that McCain, as is his wont, just winged it Sunday night, without really caring whether it was true, because that’s what he does. But let me clearly label that a hunch. I don’t know. But it doesn’t really matter.

The second reason this is devastating is maybe even bigger than the question of the Sunday lie, which is limited in scope after all to a sort of narrow legal question. The second reason is that McCain has been going around putting lobbyists, specifically for F & F, at the heart of the whole problem. This is from the Roll Call piece:

Fannie Mae and Freddie Mac emerged as issues in the presidential race last week because of turmoil in the financial markets. In a radio address from Green Bay, Wis., on Saturday, McCain blamed the companies and their political clout for creating the housing mess now roiling Wall Street. “At the center of the problem were the lobbyists, politicians and bureaucrats who succeeded in persuading Congress and the administration to ignore the festering problems at Fannie Mae and Freddie Mac,” he said. “Using money and influence, they prevented reforms that would have curbed their power and limited their ability to damage our economy. And now, as ever, the American taxpayers are left to pay the price for Washington’s failure.”

I just can’t picture any way of wiggling out of that. He is talking in those sentences about his own campaign manager! And he’s going to be able to keep him on? Strange things happen all the time, but I have trouble seeing it.

Oh and by the way: No wonder Steve Schmidt, another top McCain strategist, said on a Monday conference call with reporters that “Whatever The New York Times once was, it is today not by any standard a journalistic organization.” He obviously knew that more was coming and was trying to lay some discrediting groundwork.

This is a terrible, terrible story for McCain, and yes, the biggest political story of the general-election campaign so far.

Source / The Guardian

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