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FOCUS | David Stockman: What Do Poor Folk Know From Fancy Finance? |
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Written by <a href="index.php?option=com_comprofiler&task=userProfile&user=5494"><span class="small">Steve Weissman, Reader Supported News</span></a>
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Wednesday, 10 April 2013 13:15 |
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Weissman writes: "Do Americans really want to go back to the dog-eat-dog, winner-take-all economic system whose mess FDR struggled to clean up by taking the United States off the gold standard and ushering in the New Deal with its beginnings of a decent social safety net?"
David Stockman ran Ronald Reagan's Office of Management and Budget. (photo: Louis Lanzano/AP)
David Stockman: What Do Poor Folk Know From Fancy Finance?
By Steve Weissman, Reader Supported News
10 April 13
 oung David Stockman, the bright-eyed boy wonder who ran Ronald Reagan's Office of Management and Budget, won fame in his first year at the White House for publicly telling the truth. His highly touted "supply-side economics," he told the "Atlantic Monthly's" William Greider, was primarily "a Trojan horse," or decoy, for cutting the top tax rate for the highest earners from 70% down to 50%.
Now, with his widely discussed new book "The Great Deformation," an older Stockman returns from a lucrative, if less than stellar, career doing leveraged buyouts on Wall Street. This time he is selling new truths and half-truths, along with one overwhelming glob of magical thinking. America's future, he says, can be saved from its current evils, but only if we turn back to "free market capitalism" as it existed before President Franklin Delano Roosevelt.
Do Americans really want to go back to the dog-eat-dog, winner-take-all economic system whose mess FDR struggled to clean up by taking the United States off the gold standard and ushering in the New Deal with its beginnings of a decent social safety net? "Free market capitalism" did not work so well before that. Why would it work any better now?
Like former congressman Ron Paul, the right-wing Libertarian loner, and his son, Senator Rand Paul, a wanna-be president, Stockman is channeling “Austrian economics” as preached by Friedrich Hayek and Ludwig von Mises. Hayek and his highly polemical “On the Road to Serfdom” were spiritual guides to Reagan and Maggie Thatcher and are now required reading for Tea Party enthusiasts. The more radical Mises, Hayek's mentor back in Vienna and a Jewish refugee from the Nazis, was in 1960s America a stalwart of the rabidly right-wing John Birch Society. In his new book, Stockman mentions Mises only once, and Hayek not at all, but their anti-government, free market extremism shapes the entire argument.
Brought up in the Midwest with an old-fashioned Republican abhorrence of debt and attachment to annually balanced budgets and "sound money," preferably backed by gold, Stockman grew infatuated with the Austrians while working on the Congressional staff of the Illinois representative and later Independent presidential candidate, John Anderson. "I plunged into economics with the usual vigor," he wrote in "The Triumph of Politics," his "youthful screed" (his words) on the failure of the Reagan Revolution. "I read everything in sight, and before long I emerged a disciple of F.A. Hayek, the preeminent Austrian exponent of free market economics." Stockman later "completed his homework" by reading more of Hayek, Mises, and his American disciple, Murray Rothbard, a brilliant and amusing polymath who got just about everything half-right. Stockman has always loved a grand theory, especially one based on wishful thinking rather than cold, hard figures. As he famously admitted when he ran Reagan's budget office, "None of us really understands what's going on with all these numbers."
Most of Stockman's new truths will be old hat to readers, though he expresses them with the outrage of a former insider who feels betrayed. He reviles former Treasury secretary Hank Paulson "and his posse of eager-beaver Goldman bankers." He writes of being "shocked to read of the blatant deal making, bribing, and bullying of the troubled big banks being conducted out of the Treasury secretary's office, as if it were the M&A [Mergers and Acquisitions] department of Goldman Sachs." He was, he says, "flabbergasted when the Republican White House in September 2008 proposed the $700 billion TARP [Troubled Asset Relief Program] bailout." He "smelled a rat" when Fed chairman Ben Bernanke warned "that the Great Depression 2.0 was at hand" and "started spraying an alphabet soup of liquidity injections in every direction" in "a panicked spree of money printing that exceeded any other episode in recorded human history." And, says Stockman, "I lost it" when Treasury Secretary Paulson announced that "Washington was writing a $13 billion check to bail out General Motors." For Stockman, these were revealing moments in "the Great Deformation" of American capitalism, the "capture of the state, especially its central bank, the Federal Reserve, by crony capitalist forces deeply inimical to free markets and democracy."
Stockman is hyperbolic, to be sure, and as arrogant as an earlier Treasury secretary, Andrew Mellon, who in response to Great Depression 1.0 advised President Herbert Hoover to "liquidate labor, liquidate stocks, liquidate farmers, liquidate real estate." Stockman wanted the same for the Detroit-based auto industry - "a cold bath of free market housecleaning, along with a drastic rollback of the preposterous $100,000 per year cost of UAW [United Auto Worker] jobs." Screw the social costs, and ignore what Stockman was taking home for arguably less productive work on Wall Street. "Absent the auto bailout," he wrote with his characteristic certainty, "there would have been no car shortage or loss of jobs - just a relocation from the north to the [non-unionized] South based on the rules of the free market."
Still, Stockman's outrage conveys an important kernel of truth. Whatever inner motives drove Paulson, Bernanke, Bush, or Obama, their bail-outs, TARP, and liquidity injections have greatly strengthened and further enriched the Too-Big-To-Fail bankers and other crony capitalists who created the Crisis of 2008. For most folk who have trouble understanding all the fancy finance, this new brand of capitalism works no better than the old kind that Stockman and his right-wing Libertarians keep trying to sell.
A veteran of the Berkeley Free Speech Movement and the New Left monthly Ramparts, Steve Weissman lived for many years in London, working as a magazine writer and television producer. He now lives and works in France, where he is researching a new book, "Big Money: How Global Banks, Corporations, and Speculators Rule and How To Break Their Hold."
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FOCUS | Salivating Over Social Security Cuts |
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Wednesday, 10 April 2013 11:31 |
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Reich writes: "The Republican leadership is already salivating over the President's proposed Social Security cut. They've been wanting to cut Social Security for years."
Portrait, Robert Reich, 08/16/09. (photo: Perian Flaherty)
Salivating Over Social Security Cuts
By Robert Reich, Robert Reich's Blog
10 April 13
 ohn Boehner, Speaker of the House, revealed why it's politically naive for the President to offer up cuts in Social Security in the hope of getting Republicans to close some tax loopholes for the rich. "If the President believes these modest entitlement savings are needed to help shore up these programs, there's no reason they should be held hostage for more tax hikes,” Boehner said in a statement released Friday.
House Majority Leader Eric Cantor agreed. He said on CNBC he didn't understand "why we just don't see the White House come forward and do the things that we agree on” such as cutting Social Security, without additional tax increases.
Get it? The Republican leadership is already salivating over the President's proposed Social Security cut. They've been wanting to cut Social Security for years.
But they won't agree to close tax loopholes for the rich.
They're already characterizing the President's plan as a way to "save” Social Security - even though the cuts would undermine it - and they're embracing it as an act of "bi-partisanship.”
"I'm encouraged by any steps that President Obama is taking to save and preserve Social Security,” cooed Texas Republican firebrand Ted Cruz. "I think it should be a bipartisan priority to strengthen Social Security and Medicare to preserve the benefits for existing seniors.”
Oh, please. Social Security hasn't contributed to the budget deficit. And it's solvent for the next two decades. (If we want to insure its solvency beyond that, the best fix is to lift the cap on income subject to Social Security taxes – now $113,700.)
And the day Ted Cruz agrees to raise taxes on the wealthy or even close a tax loophole will be when Texas freezes over.
The President is scheduled to dine with a dozen Senate Republicans Wednesday night. Among those attending will be John Boozman of Arkansas, who has already praised Obama for "starting to throw things on the table,” like the Social Security cuts.
That's exactly the problem. The President throws things on the table before the Republicans have even sat down for dinner.
The President's predilection for negotiating with himself is not new. But his willingness to do it with Social Security, the government's most popular program - which Democrats have protected from Republican assaults for almost eighty years - doesn't bode well.
The President desperately wants a "grand bargain” on the deficit. Republicans know he does. Watch your wallets.
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About Thatcher |
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Tuesday, 09 April 2013 08:58 |
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de Winter writes: "Thatcher did almost as much to mess up England as Ronald Reagan did to mess up the USA. Curiously enough, both were admired for their stubborn and corrupt vandalism, by people who were incapable of recognizing the corrupt vandalism for what it was."
Margaret Thatcher, pictured in 2005, inspired hatred and adoration but never indifference. (photo: AFP)
About Thatcher
By Francis de Winter, Reader Supported News
09 April 13
 he rode the Malvinas War to a long stay in government, but the Malvinas War was (and continues to be) really a question of stupid and useless chauvinism for both Argentina and England.
The Argentine author Borges said that the Malvinas War was like two almost totally bald and crotchety old men fighting about a comb.
Based on the "admiration" that Thatcher got from her Malvinas War performance, Thatcher built a super-highway system in England that allowed England to waste all of the oil it had found in the North Atlantic in about 20 years, and to become more than ever addicted to oil it no longer had. Thatcher did almost as much to mess up England as Ronald Reagan did to mess up the USA. Curiously enough, both were admired for their stubborn and corrupt vandalism, by people who were incapable of recognizing the corrupt vandalism for what it was.
The last 100 years or so has had an enormous number of really useless and destructive men, and a few useless and destructive women: Ayn Rand, Phyllis Schlafly, Sarah Palin, Margaret Thatcher, and just a few others. We can be grateful that Sarah Palin did not get very far, and that the USA did not have to put up with both Ronald Reagan and Margaret Thatcher.
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FOCUS | Margaret Thatcher and Misapplied Death Etiquette |
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Written by <a href="index.php?option=com_comprofiler&task=userProfile&user=7181"><span class="small">Glenn Greenwald, Guardian UK</span></a>
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Monday, 08 April 2013 10:38 |
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Greenwald writes: "The dictate that one 'not speak ill of the dead' is (at best) appropriate for private individuals, not influential public figures."
Mrs. Thatcher with President Ronald Reagan outside her Downing Street office in 1982. (photo: Bob Dear/AP)
Margaret Thatcher and Misapplied Death Etiquette
By Glenn Greenwald, Guardian UK
08 April 13
The dictate that one 'not speak ill of the dead' is (at best) appropriate for private individuals, not influential public figures.
 ews of Margaret Thatcher's death this morning instantly and predictably gave rise to righteous sermons on the evils of speaking ill of her. British Labour MP Tom Watson decreed: "I hope that people on the left of politics respect a family in grief today." Following in the footsteps of Santa Claus, Steve Hynd quickly compiled a list of all the naughty boys and girls "on the left" who dared to express criticisms of the dearly departed Prime Minister, warning that he "will continue to add to this list throughout the day". Former Tory MP Louise Mensch, with no apparent sense of irony, invoked precepts of propriety to announce: "Pygmies of the left so predictably embarrassing yourselves, know this: not a one of your leaders will ever be globally mourned like her."
This demand for respectful silence in the wake of a public figure's death is not just misguided but dangerous. That one should not speak ill of the dead is arguably appropriate when a private person dies, but it is wildly inappropriate for the death of a controversial public figure, particularly one who wielded significant influence and political power. "Respecting the grief" of Thatcher family's members is appropriate if one is friends with them or attends a wake they organize, but the protocols are fundamentally different when it comes to public discourse about the person's life and political acts. I made this argument at length last year when Christopher Hitchens died and a speak-no-ill rule about him was instantly imposed (a rule he, more than anyone, viciously violated), and I won't repeat that argument today; those interested can read my reasoning here.
But the key point is this: those who admire the deceased public figure (and their politics) aren't silent at all. They are aggressively exploiting the emotions generated by the person's death to create hagiography. Typifying these highly dubious claims was this (appropriately diplomatic) statement from President Obama: "The world has lost one of the great champions of freedom and liberty, and America has lost a true friend." Those gushing depictions can be incredibly consequential, as it was for the week-long tidal wave of unbroken reverence that was heaped on Ronald Reagan upon his death, an episode that to this day shapes how Americans view him and the political ideas he symbolized. Demanding that no criticisms be voiced to counter that hagiography is to enable false history and a propagandistic whitewashing of bad acts, distortions that become quickly ossified and then endure by virtue of no opposition and the powerful emotions created by death. When a political leader dies, it is irresponsible in the extreme to demand that only praise be permitted but not criticisms.
Whatever else may be true of her, Thatcher engaged in incredibly consequential acts that affected millions of people around the world. She played a key role not only in bringing about the first Gulf War but also using her influence to publicly advocate for the 2003 attack on Iraq. She denounced Nelson Mandela and his ANC as "terrorists", something even David Cameron ultimately admitted was wrong. She was a steadfast friend to brutal tyrants such as Augusto Pinochet, Saddam Hussein and Indonesian dictator General Suharto ("One of our very best and most valuable friends"). And as my Guardian colleague Seumas Milne detailed last year, "across Britain Thatcher is still hated for the damage she inflicted – and for her political legacy of rampant inequality and greed, privatisation and social breakdown."
To demand that all of that be ignored in the face of one-sided requiems to her nobility and greatness is a bit bullying and tyrannical, not to mention warped. As David Wearing put it this morning To the millions who detested him as a thug and charlatan, it will be occasion to bid, vocally or discreetly, good riddance."in satirizing these speak-no-ill-of-the-deceased moralists: "People praising Thatcher's legacy should show some respect for her victims. Tasteless." Tellingly, few people have trouble understanding the need for balanced commentary when the political leaders disliked by the west pass away. Here, for instance, was what the Guardian reported upon the death last month of Hugo Chavez:
To the millions who detested him as a thug and charlatan, it will be occasion to bid, vocally or discreetly, good riddance."
Nobody, at least that I know of, objected to that observation on the ground that it was disrespectful to the ability of the Chavez family to mourn in peace. Any such objections would have been invalid. It was perfectly justified to note that, particularly as the Guardian also explained that "to the millions who revered him – a third of the country, according to some polls – a messiah has fallen, and their grief will be visceral." Chavez was indeed a divisive and controversial figure, and it would have been reckless to conceal that fact out of some misplaced deference to the grief of his family and supporters. He was a political and historical figure and the need to accurately portray his legacy and prevent misleading hagiography easily outweighed precepts of death etiquette that prevail when a private person dies.
Exactly the same is true of Thatcher. There's something distinctively creepy - in a Roman sort of way - about this mandated ritual that our political leaders must be heralded and consecrated as saints upon death. This is accomplished by this baseless moral precept that it is gauche or worse to balance the gushing praise for them upon death with valid criticisms. There is absolutely nothing wrong with loathing Margaret Thatcher or any other person with political influence and power based upon perceived bad acts, and that doesn't change simply because they die. If anything, it becomes more compelling to commemorate those bad acts upon death as the only antidote against a society erecting a false and jingoistically self-serving history.
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