By Shamus Cooke
Global Research,
December 28, 2009
On Sunday in Iran, mass protests were drowned in blood by government authorities; at least ten reportedly have been killed with hundreds injured. The events have been given ample coverage in the U.S. media, with the intention of further demonizing Iran's repressive government. Absent in the American media are the deeper implications of the protests, which, to anyone paying close attention, constitute a powerful revolutionary movement.
This movement has grown exponentially in a very short period of time. Although only beginning in June over allegations of voter fraud, the movement is now endorsed by millions of combative Iranians, demanding “death to the dictator,” while they waive an Iranian flag that's missing the Muslim insignia. Massive demonstrations in the streets and university campuses have directly confronted police repression and in some cases have overcome it. The New York Times describes a scene found only in instances of revolution:
“There were scattered reports of police officers surrendering, or refusing to fight. Several videos posted on the Internet show officers holding up their helmets and walking away from the melee, as protesters pat them on the back in appreciation. In one photograph, several police officers can be seen holding their arms up, and one of them wears a bright green headband, the signature color of the opposition movement.” (December 27, 2009).
The recent killing of protesters is likely to have the opposite of its intended effect: protesters are likely to become even more demanding and radicalized. After the shots were fired, thousands of demonstrators were heard yelling: “I'll kill, I'll kill those who killed my brothers.” If the current Iranian government survives the revolutionary movement, it will do so only after a prolonged period of extreme domestic crisis and repression.
The reaction of the U.S. government to the month's long events in Iran has been largely to ignore it. After some initial comments in June, the White House has talked only about Iran's “nuclear ambitions,” minus one sentence in Obama's Orwellian Nobel Peace Prize speech, where he said: “We will bear witness to the hundreds of thousands marching in the streets of Iran.”
Not only has the U.S. government not “born witness” to the people's struggle in Iran, the Democrats are working to undermine it. U.S. Senate Majority Leader Harry Reid has announced his intention to push forward potentially crippling U.S. sanctions against Iran's oil imports (Iran cannot refine all of the oil it needs, and must import 40 percent). If realized, this action would amount to an act of war.
The AFP reports: “The legislation, which includes sanctions that can be slapped on foreign companies with more than 20 million dollars of investments in Iran's energy sector, was approved by the Banking Committee at end of October.” (December 25, 2009).
The effect of such an economic attack will be to assist Iran's current rulers, who will use the provocation to distract the public away from domestic issues, and focus instead on a powerful foreign enemy.
But “liberals” in Washington are not only advocating economic acts of war, but also the direct military type. A recent Op-Ed article in the New York Times was titled “There's Only One Way to Stop Iran.” The author was more than blunt:
“We have reached the point where air strikes are the only plausible option with any prospect of preventing Iran's acquisition of nuclear weapons. Postponing military action merely provides Iran a window to expand, disperse and harden its nuclear facilities against attack. The sooner the United States takes action, the better.” (December 24, 2009).
This essay is from the U.S.' most powerful “liberal” mainstream newspaper.
In the same article, the author writes about the consequences of a U.S. attack on the Iranian “opposition,” i.e., revolutionary movement. He admits that such an attack would have dire consequences for the Iranian social movement, but says it would be “temporary.”
It should be no surprise that Washington's “liberal” wing of the corporate establishment is getting in line behind a more aggressive approach to Iran, since the exact same thing happened on the war path to Iraq.
Like Iraq, politicians are conjuring up nightmare scenarios to scare the American public into accepting an attack on Iran. In fact, the exact same bogeymen are being used which justified the invasion of Iraq. Iran, we are told, will give nuclear weapons to terrorists, just like Saddam was supposedly about to do.
Also like Iraq, there is zero evidence of nuclear weapons in Iran. Contrary to the accusations of Democrats and Republicans, the U.S. government's own National Intelligence Estimate of late 2007 stated that Iran had halted its entire nuclear weapons program in 2003 and had not re-started it as of 2007.
U.N. inspectors inside of Iran have also reported zero evidence of nuclear weaponry. Likely, however, as in Iraq, false “intelligence” may be “uncovered” that could be used to justify an attack.
Regardless of the many media-invented lies surrounding the situation in Iran, the real cause for intervention would be the same as Iraq: oil and corporate profits in general.
Like Iraq, Iran has lots of oil. Also like Iraq, Iran has a large state sector that could be privatized as gifts for U.S. corporations. Like Iraq, Iran is not a puppet of the United States, one of the few countries in the oil-rich Middle East hanging on to their independence.
This Iranian revolution, if successful, has profound implications for the Middle East and beyond. The last Iranian revolution, in 1979, shook off the U.S.-installed puppet dictator and made Iran an independent country. Unfortunately, the aspirations of the people were choked off by the Ayatollahs, who stopped the revolutionary movement in its tracks by murdering progressives by the thousands.
Because the Middle East continues to be dominated by U.S. puppets or directly by the U.S. military, Iran's independence continues to be a source of inspiration for millions in the region. Regrettably, the stunted outcome of the 1979 revolution is also viewed as a goal for many of these same people, who wrongly see a religious government as more just and equitable than what they currently experience under U.S. domination.
The popular revolution in Iran is likely to come into conflict with not only Mullahs, but in addition, powerful corporations. The people will not be satisfied submitting to either, making this revolution inherently more radical than the “pro-democracy” label given by the U.S. government. If Iran were to complete a revolution that made its goal to spend its oil wealth and other riches on the people, it would send an example that would rock the Middle East. Any U.S. or Israeli intervention would be useless, which is precisely why they may try to abort the baby before it is born.
Those in the United States involved in the anti-war movement must be aware of the unfolding events in Iran. The people of Iran must be allowed to complete their revolution without U.S. intervention. HANDS OFF IRAN!
Tuesday, December 29, 2009
Thursday, December 24, 2009
Senate Passes Historic Health Bill
By CARRIE BUDOFF BROWN & MEREDITH SHINER | 12/24/09 7:19 AM EST
Updated: 12/24/09 8:34 AM EST
After months of blown deadlines and political near-death experiences, a sweeping health care reform bill cleared the Senate Thursday on a party-line vote, putting President Barack Obama within reach of a domestic policy achievement that has eluded Democrats for decades.
With Vice President Joe Biden presiding over the session, Democrats gathered in the chamber before sunrise on the day before Christmas to cast a vote long in coming but in the end, hardly a surprise, a 60-39 tally that was the fourth time in as many days that Democrats proved they could muster the winning margin.
But this was the one that counted, the bookend to a House vote last month that puts Congress on record saying that Americans have the right to affordable health insurance, with plans that will cover 30 million Americans currently without it.
Senate Majority Leader Harry Reid (D-Nev.) said before the vote that Americans could wait no longer. “We certainly don’t have. . .the luxury of waiting. We may not completely cure this crisis today or tomorrow, but we must strive toward that progress.”
When Sen. Robert Byrd’s name was called, the ailing West Virginian said, “Mr. President, this is for my friend, Ted Kennedy – aye," a reference to the late Massachusetts senator who long fought for universal health care.
But Senate Republican leader Mitch McConnell (R-Ky.) vowed: “This fight isn’t over. My colleagues and I will work to stop this bill from becoming law. That’s the clear will of the American people — and we’re going to continue to fight on their behalf.”
The vote sets the stage for difficult House-Senate negotiations during which Democrats will be forced to settle differences that have lingered for months, and there is no guarantee a bill will pass in the end.
Sen. Joe Lieberman (I-Conn.), one of the last Democratic holdouts, once again made clear that his vote isn’t assured when the bill returns to the Senate. In the hallway outside the vote, he told his fellow moderate, Sen. Ben Nelson (D-Neb.), “Our work is not over.”
"Splitting the difference here could well break the 60 vote consensus," Lieberman said to reporters.
With momentum at their back, Democrats believe they can craft a compromise that, in broad strokes, would expand coverage through subsidies to help Americans buy insurance and allowing more people into the Medicaid program. The Senate plan includes a new national health insurance program overseen by the government but offered through private insurers.
It would prevent insurance companies from dropping patients who get sick and create a new legal requirement that all Americans must own health insurance – a provision already under growing attack from conservatives.
NOTE:
As always, the "devil will be in the details." It is difficult to conceive of how the House and Senate bills can be reconciled given that they are so different. Recall, the House bill contains a moderately aggressive "Public Option" while the Senate bill does not contain any Public Option at all.
Moreover the Senate bill has minimal provisions for cost containment. The most remarkable fact is that the Senate bill will force Americans to buy private health care coverage for the first time as a matter of law without providing any tough sanctions to prevent health insurance companies from excessively raising rates. After the Public Option was defeated in the Senate, health insurance company stocks soared in value indicating that the Senate bill is a financial bonanza for the private health insurance industry--a moral travesty that.
--Dr. J. P. Hubert
Updated: 12/24/09 8:34 AM EST
After months of blown deadlines and political near-death experiences, a sweeping health care reform bill cleared the Senate Thursday on a party-line vote, putting President Barack Obama within reach of a domestic policy achievement that has eluded Democrats for decades.
With Vice President Joe Biden presiding over the session, Democrats gathered in the chamber before sunrise on the day before Christmas to cast a vote long in coming but in the end, hardly a surprise, a 60-39 tally that was the fourth time in as many days that Democrats proved they could muster the winning margin.
But this was the one that counted, the bookend to a House vote last month that puts Congress on record saying that Americans have the right to affordable health insurance, with plans that will cover 30 million Americans currently without it.
Senate Majority Leader Harry Reid (D-Nev.) said before the vote that Americans could wait no longer. “We certainly don’t have. . .the luxury of waiting. We may not completely cure this crisis today or tomorrow, but we must strive toward that progress.”
When Sen. Robert Byrd’s name was called, the ailing West Virginian said, “Mr. President, this is for my friend, Ted Kennedy – aye," a reference to the late Massachusetts senator who long fought for universal health care.
But Senate Republican leader Mitch McConnell (R-Ky.) vowed: “This fight isn’t over. My colleagues and I will work to stop this bill from becoming law. That’s the clear will of the American people — and we’re going to continue to fight on their behalf.”
The vote sets the stage for difficult House-Senate negotiations during which Democrats will be forced to settle differences that have lingered for months, and there is no guarantee a bill will pass in the end.
Sen. Joe Lieberman (I-Conn.), one of the last Democratic holdouts, once again made clear that his vote isn’t assured when the bill returns to the Senate. In the hallway outside the vote, he told his fellow moderate, Sen. Ben Nelson (D-Neb.), “Our work is not over.”
"Splitting the difference here could well break the 60 vote consensus," Lieberman said to reporters.
With momentum at their back, Democrats believe they can craft a compromise that, in broad strokes, would expand coverage through subsidies to help Americans buy insurance and allowing more people into the Medicaid program. The Senate plan includes a new national health insurance program overseen by the government but offered through private insurers.
It would prevent insurance companies from dropping patients who get sick and create a new legal requirement that all Americans must own health insurance – a provision already under growing attack from conservatives.
NOTE:
As always, the "devil will be in the details." It is difficult to conceive of how the House and Senate bills can be reconciled given that they are so different. Recall, the House bill contains a moderately aggressive "Public Option" while the Senate bill does not contain any Public Option at all.
Moreover the Senate bill has minimal provisions for cost containment. The most remarkable fact is that the Senate bill will force Americans to buy private health care coverage for the first time as a matter of law without providing any tough sanctions to prevent health insurance companies from excessively raising rates. After the Public Option was defeated in the Senate, health insurance company stocks soared in value indicating that the Senate bill is a financial bonanza for the private health insurance industry--a moral travesty that.
--Dr. J. P. Hubert
Sunday, December 20, 2009
Health-care bill wouldn't bring real reform
By Howard Dean
Washington Post
Thursday, December 17, 2009
If I were a senator, I would not vote for the current health-care bill. Any measure that expands private insurers' monopoly over health care and transfers millions of taxpayer dollars to private corporations is not real health-care reform. Real reform would insert competition into insurance markets, force insurers to cut unnecessary administrative expenses and spend health-care dollars caring for people. Real reform would significantly lower costs, improve the delivery of health care and give all Americans a meaningful choice of coverage. The current Senate bill accomplishes none of these.
Real health-care reform is supposed to eliminate discrimination based on preexisting conditions. But the legislation allows insurance companies to charge older Americans up to three times as much as younger Americans, pricing them out of coverage. The bill was supposed to give Americans choices about what kind of system they wanted to enroll in. Instead, it fines Americans if they do not sign up with an insurance company, which may take up to 30 percent of your premium dollars and spend it on CEO salaries -- in the range of $20 million a year -- and on return on equity for the company's shareholders. Few Americans will see any benefit until 2014, by which time premiums are likely to have doubled. In short, the winners in this bill are insurance companies; the American taxpayer is about to be fleeced with a bailout in a situation that dwarfs even what happened at AIG.
From the very beginning of this debate, progressives have argued that a public option or a Medicare buy-in would restore competition and hold the private health insurance industry accountable. Progressives understood that a public plan would give Americans real choices about what kind of system they wanted to be in and how they wanted to spend their money. Yet Washington has decided, once again, that the American people cannot be trusted to choose for themselves. Your money goes to insurers, whether or not you want it to.
To be clear, I'm not giving up on health-care reform. The legislation does have some good points, such as expanding Medicaid and permanently increasing the federal government's contribution to it. It invests critical dollars in public health, wellness and prevention programs; extends the life of the Medicare trust fund; and allows young Americans to stay on their parents' health-care plans until they turn 27. Small businesses struggling with rising health-care costs will receive a tax credit, and primary-care physicians will see increases in their Medicare and Medicaid reimbursement rates.
Improvements can still be made in the Senate, and I hope that Senate Democrats will work on this bill as it moves to conference. If lawmakers are interested in ensuring that government affordability credits are spent on health-care benefits rather than insurers' salaries, they need to require state-based exchanges, which act as prudent purchasers and select only the most efficient insurers. Sen. John Kerry (D-Mass.) offered this amendment during the Finance Committee markup, and Democrats should include it in the final legislation. A stripped-down version of the current bill that included these provisions would be worth passing.
In Washington, when major bills near final passage, an inside-the-Beltway mentality takes hold. Any bill becomes a victory. Clear thinking is thrown out the window for political calculus. In the heat of battle, decisions are being made that set an irreversible course for how future health reform is done. The result is legislation that has been crafted to get votes, not to reform health care.
I have worked for health-care reform all my political life. In my home state of Vermont, we have accomplished universal health care for children younger than 18 and real insurance reform -- which not only bans discrimination against preexisting conditions but also prevents insurers from charging outrageous sums for policies as a way of keeping out high-risk people. I know health reform when I see it, and there isn't much left in the Senate bill. I reluctantly conclude that, as it stands, this bill would do more harm than good to the future of America.
Washington Post
Thursday, December 17, 2009
If I were a senator, I would not vote for the current health-care bill. Any measure that expands private insurers' monopoly over health care and transfers millions of taxpayer dollars to private corporations is not real health-care reform. Real reform would insert competition into insurance markets, force insurers to cut unnecessary administrative expenses and spend health-care dollars caring for people. Real reform would significantly lower costs, improve the delivery of health care and give all Americans a meaningful choice of coverage. The current Senate bill accomplishes none of these.
Real health-care reform is supposed to eliminate discrimination based on preexisting conditions. But the legislation allows insurance companies to charge older Americans up to three times as much as younger Americans, pricing them out of coverage. The bill was supposed to give Americans choices about what kind of system they wanted to enroll in. Instead, it fines Americans if they do not sign up with an insurance company, which may take up to 30 percent of your premium dollars and spend it on CEO salaries -- in the range of $20 million a year -- and on return on equity for the company's shareholders. Few Americans will see any benefit until 2014, by which time premiums are likely to have doubled. In short, the winners in this bill are insurance companies; the American taxpayer is about to be fleeced with a bailout in a situation that dwarfs even what happened at AIG.
From the very beginning of this debate, progressives have argued that a public option or a Medicare buy-in would restore competition and hold the private health insurance industry accountable. Progressives understood that a public plan would give Americans real choices about what kind of system they wanted to be in and how they wanted to spend their money. Yet Washington has decided, once again, that the American people cannot be trusted to choose for themselves. Your money goes to insurers, whether or not you want it to.
To be clear, I'm not giving up on health-care reform. The legislation does have some good points, such as expanding Medicaid and permanently increasing the federal government's contribution to it. It invests critical dollars in public health, wellness and prevention programs; extends the life of the Medicare trust fund; and allows young Americans to stay on their parents' health-care plans until they turn 27. Small businesses struggling with rising health-care costs will receive a tax credit, and primary-care physicians will see increases in their Medicare and Medicaid reimbursement rates.
Improvements can still be made in the Senate, and I hope that Senate Democrats will work on this bill as it moves to conference. If lawmakers are interested in ensuring that government affordability credits are spent on health-care benefits rather than insurers' salaries, they need to require state-based exchanges, which act as prudent purchasers and select only the most efficient insurers. Sen. John Kerry (D-Mass.) offered this amendment during the Finance Committee markup, and Democrats should include it in the final legislation. A stripped-down version of the current bill that included these provisions would be worth passing.
In Washington, when major bills near final passage, an inside-the-Beltway mentality takes hold. Any bill becomes a victory. Clear thinking is thrown out the window for political calculus. In the heat of battle, decisions are being made that set an irreversible course for how future health reform is done. The result is legislation that has been crafted to get votes, not to reform health care.
I have worked for health-care reform all my political life. In my home state of Vermont, we have accomplished universal health care for children younger than 18 and real insurance reform -- which not only bans discrimination against preexisting conditions but also prevents insurers from charging outrageous sums for policies as a way of keeping out high-risk people. I know health reform when I see it, and there isn't much left in the Senate bill. I reluctantly conclude that, as it stands, this bill would do more harm than good to the future of America.
Deal on health bill is reached
By Shailagh Murray and Lori Montgomery
Washington Post
Sunday, December 20, 2009
Senate Democrats said Saturday that they had closed ranks in support of legislation to overhaul the nation's health-care system, ending months of internal division and clearing a path for quick Senate passage of President Obama's top domestic policy priority.
Majority Leader Harry M. Reid (D-Nev.) secured the pivotal 60th vote after acceding to the demands of Sen. Ben Nelson (D-Neb.) for tighter restrictions on insurance coverage for abortions, along with increased federal aid for his home state and breaks for favored health-care interests.
"Change is never easy, but change is what's necessary in America," Nelson said at a morning news conference, announcing his support as a snowstorm raged outside.
Speaking at the White House, Obama said it appears that a vote is certain on a bill that would provide coverage to more than 30 million uninsured Americans. "After a nearly century-long struggle, we are on the cusp of making health-care reform a reality," said Obama, who had dispatched senior administration officials to help lock down Nelson's support.
Republicans excoriated the bill as a threat to Medicare -- cuts to the program for the elderly would offset much of the cost -- and to the employer-based insurance system, which provides health coverage to most Americans.
"This bill is a monstrosity," said Minority Leader Mitch McConnell (R-Ky.). "This is not renaming the post office. Make no mistake -- this bill will reshape our nation and our lives."
GOP leaders, who have vowed to use every available tactic to keep the measure from advancing, invoked a rarely used Senate rule to require that the entire 383-page package of amendments introduced by Reid Saturday morning be read aloud on the floor, a process that consumed about seven hours.
But Republicans were running out of options in their quest to derail the overhaul. Securing Nelson's support allows Reid to maneuver the legislation through a complex parliamentary minefield without obstruction. A bloc of 60 votes is the exact number required to choke off the filibuster, the Senate minority's primary source of power, and the GOP's best hope of defeating the bill.
Unless the GOP yields and the vote comes sooner, the bill is expected to pass in a final Senate vote at 7 p.m. on Christmas Eve. Negotiations to merge the bill with the House version would begin early next month.
Many liberals, however, were bitterly disappointed with the bargains Reid struck to win support from moderates in his caucus, any member of which could demand alterations in exchange for his or her support.
Democratic leaders dropped a government insurance option and the idea of expanding Medicare to younger Americans. Reid also omitted language that would have eliminated the federal antitrust exemption for health insurers -- another nonstarter for Nelson
(Editor's emphasis).
Savings forecast
Congressional budget analysts reported Saturday that the revised package would not worsen the nation's fiscal situation, as GOP critics have warned. The analysts said the updated Senate bill would spend $871 billion over the next decade to extend coverage to the uninsured by dramatically expanding Medicaid and by offering federal subsidies to those who lack affordable coverage through employers.
Editor's NOTE:
As always, the "devil will be in the details." Without a public option or some other powerful incentive which forces the health insurance industry to stop excessive rate increases, there will be no way to control costs or to make certain that people will be able to afford the private coverage which is mandated. Moreover, the industry has four years in which to continue the despicable practice of refusing to cover adult patients with pre-existing medical conditions. Even in 2014 there is no guarantee that premiums for those with pre-existing conditions will be affordable. Worse yet, the purported increased medicaid coverage the bill envisions is the very worst of all reimbursement schemes available for medical providers. The fact that medicare reimbursements will be decreased rather than increased is also self-defeating as medicare reimbursements are already too low.
The current iteration of the Senate bill does nothing to eliminate the wasted dollars which the private insurance industry now spends on excessive corporate salaries/bonuses/benefits or the dollars which accrue to stockholders of publicly traded health insurance companies. Those proceeds should be payed to providers of actual health care.
It remains unclear how the Senate and House bills which differ so markedly can be reconciled in conference. It appears that the health insurance and pharmaceutical industries have managed through extensive lobbying efforts to secure their morally illicit monopolies.
--Dr. J. P. Hubert
Washington Post
Sunday, December 20, 2009
Senate Democrats said Saturday that they had closed ranks in support of legislation to overhaul the nation's health-care system, ending months of internal division and clearing a path for quick Senate passage of President Obama's top domestic policy priority.
Majority Leader Harry M. Reid (D-Nev.) secured the pivotal 60th vote after acceding to the demands of Sen. Ben Nelson (D-Neb.) for tighter restrictions on insurance coverage for abortions, along with increased federal aid for his home state and breaks for favored health-care interests.
"Change is never easy, but change is what's necessary in America," Nelson said at a morning news conference, announcing his support as a snowstorm raged outside.
Speaking at the White House, Obama said it appears that a vote is certain on a bill that would provide coverage to more than 30 million uninsured Americans. "After a nearly century-long struggle, we are on the cusp of making health-care reform a reality," said Obama, who had dispatched senior administration officials to help lock down Nelson's support.
Republicans excoriated the bill as a threat to Medicare -- cuts to the program for the elderly would offset much of the cost -- and to the employer-based insurance system, which provides health coverage to most Americans.
"This bill is a monstrosity," said Minority Leader Mitch McConnell (R-Ky.). "This is not renaming the post office. Make no mistake -- this bill will reshape our nation and our lives."
GOP leaders, who have vowed to use every available tactic to keep the measure from advancing, invoked a rarely used Senate rule to require that the entire 383-page package of amendments introduced by Reid Saturday morning be read aloud on the floor, a process that consumed about seven hours.
But Republicans were running out of options in their quest to derail the overhaul. Securing Nelson's support allows Reid to maneuver the legislation through a complex parliamentary minefield without obstruction. A bloc of 60 votes is the exact number required to choke off the filibuster, the Senate minority's primary source of power, and the GOP's best hope of defeating the bill.
Unless the GOP yields and the vote comes sooner, the bill is expected to pass in a final Senate vote at 7 p.m. on Christmas Eve. Negotiations to merge the bill with the House version would begin early next month.
Many liberals, however, were bitterly disappointed with the bargains Reid struck to win support from moderates in his caucus, any member of which could demand alterations in exchange for his or her support.
Democratic leaders dropped a government insurance option and the idea of expanding Medicare to younger Americans. Reid also omitted language that would have eliminated the federal antitrust exemption for health insurers -- another nonstarter for Nelson
(Editor's emphasis).
Savings forecast
Congressional budget analysts reported Saturday that the revised package would not worsen the nation's fiscal situation, as GOP critics have warned. The analysts said the updated Senate bill would spend $871 billion over the next decade to extend coverage to the uninsured by dramatically expanding Medicaid and by offering federal subsidies to those who lack affordable coverage through employers.
Editor's NOTE:
As always, the "devil will be in the details." Without a public option or some other powerful incentive which forces the health insurance industry to stop excessive rate increases, there will be no way to control costs or to make certain that people will be able to afford the private coverage which is mandated. Moreover, the industry has four years in which to continue the despicable practice of refusing to cover adult patients with pre-existing medical conditions. Even in 2014 there is no guarantee that premiums for those with pre-existing conditions will be affordable. Worse yet, the purported increased medicaid coverage the bill envisions is the very worst of all reimbursement schemes available for medical providers. The fact that medicare reimbursements will be decreased rather than increased is also self-defeating as medicare reimbursements are already too low.
The current iteration of the Senate bill does nothing to eliminate the wasted dollars which the private insurance industry now spends on excessive corporate salaries/bonuses/benefits or the dollars which accrue to stockholders of publicly traded health insurance companies. Those proceeds should be payed to providers of actual health care.
It remains unclear how the Senate and House bills which differ so markedly can be reconciled in conference. It appears that the health insurance and pharmaceutical industries have managed through extensive lobbying efforts to secure their morally illicit monopolies.
--Dr. J. P. Hubert
Saturday, December 19, 2009
Pharmceutical Lobby Defeats American People with Obama Administration Support
Senate Rejects Plan to Import Low-cost Drugs
By ALAN FRAM
December 16, 2009 "AP" -- WASHINGTON — The Senate rejected a plan Tuesday to allow Americans to import low-cost prescriptions from abroad, handing drug makers a victory that may help secure passage of President Barack Obama's health care overhaul.
The vote on the amendment by Sen. Byron Dorgan, D-N.D., was 51-48 in favor, but 60 votes were needed to prevail under a special rule. Obama had supported the measure as a senator, but his administration echoed safety concerns raised by the pharmaceutical industry — which is supporting the Democrats' health care bill.
An angry Dorgan denounced a competing amendment that would permit drug imports if the Food and Drug Administration certifies it can be done without risks.
"Do not vote for this amendment and say you've done something about the price of prescription drugs because constituents will know better," Dorgan admonished his colleagues.
The alternative amendment by Sen. Frank Lautenberg, D-N.J., also failed on a 56-43 vote. The House bill is silent on the issue.
Dorgan's plan would have allowed American pharmacies and drug wholesalers to import federally approved drugs from Canada, Europe, Australia, New Zealand and Japan — placing them within reach of average consumers.
Both the pharmaceutical industry and the Obama administration were lobbying against the proposal, saying it would not protect people from potentially dangerous or ineffective drugs. Dorgan's plan would have cost drug makers billions of dollars and had bipartisan support.
A standoff over the proposal had complicated progress on health care overhaul, which has been snagged in the Senate for two weeks.
Lautenberg's state is a center of the pharmaceutical industry. His proposal permits drug imports but adds a requirement that the U.S. government certify that the imports will be safe — a guarantee that Democrats and Republicans agree would be impossible to make.
Dorgan and others saw Lautenberg's amendment as a way to lure away Dorgan's supporters. The North Dakotan has introduced his drug import amendment repeatedly over the last decade, only to see the Senate effectively kill it by adding requirements for safety guarantees.
"We've seen that before, and the pharmaceutical industry supports advancing this as a way to defeat importation," said Dorgan.
Many countries have price controls that let them charge lower prices than are common in the U.S.
Though Obama supported the importation of low-price drugs when he was running for the White House last year, the FDA last week criticized Dorgan's proposal for not doing enough to ensure that drugs entering the U.S. from abroad will be safe (Editor's emphasis throughout). Dorgan countered that his amendment had strong safeguards, allowing imports only of FDA-approved drugs from FDA-approved foreign plants.
White House officials have denied accusations by Dorgan's supporters that the administration was opposing importation as a way of retaining the drug industry's support for Obama's health care overhaul legislation, the president's top domestic priority.
In June, the industry agreed to provide consumers and the government with $80 billion in savings. Drug makers have spent tens of millions of dollars on TV ads promoting the health overhaul effort, making them one of the biggest advertisers in this year's health care fight, and the administration has little interest in antagonizing its ally.
The nonpartisan Congressional Budget office estimated that Dorgan's plan would have saved the federal government $19 billion over the coming decade. Dorgan says it would have saved American consumers four times that amount.
Editor's NOTE:
Big Pharma has once again succeeded in defeating a prescription drug bill which would have saved countless lives of Americans who cannot currently afford expensive medicines and saved the nation billions of dollars--all in the name of insuring unconscionable profits for the pharmaceutical industry. The "quality" excuse is a ruse as Senator Dorgan has rightly elucidated. This is an unapologetic attempt at maintaining a government guaranteed immoral monopoly.
--Dr. J. P. Hubert
By ALAN FRAM
December 16, 2009 "AP" -- WASHINGTON — The Senate rejected a plan Tuesday to allow Americans to import low-cost prescriptions from abroad, handing drug makers a victory that may help secure passage of President Barack Obama's health care overhaul.
The vote on the amendment by Sen. Byron Dorgan, D-N.D., was 51-48 in favor, but 60 votes were needed to prevail under a special rule. Obama had supported the measure as a senator, but his administration echoed safety concerns raised by the pharmaceutical industry — which is supporting the Democrats' health care bill.
An angry Dorgan denounced a competing amendment that would permit drug imports if the Food and Drug Administration certifies it can be done without risks.
"Do not vote for this amendment and say you've done something about the price of prescription drugs because constituents will know better," Dorgan admonished his colleagues.
The alternative amendment by Sen. Frank Lautenberg, D-N.J., also failed on a 56-43 vote. The House bill is silent on the issue.
Dorgan's plan would have allowed American pharmacies and drug wholesalers to import federally approved drugs from Canada, Europe, Australia, New Zealand and Japan — placing them within reach of average consumers.
Both the pharmaceutical industry and the Obama administration were lobbying against the proposal, saying it would not protect people from potentially dangerous or ineffective drugs. Dorgan's plan would have cost drug makers billions of dollars and had bipartisan support.
A standoff over the proposal had complicated progress on health care overhaul, which has been snagged in the Senate for two weeks.
Lautenberg's state is a center of the pharmaceutical industry. His proposal permits drug imports but adds a requirement that the U.S. government certify that the imports will be safe — a guarantee that Democrats and Republicans agree would be impossible to make.
Dorgan and others saw Lautenberg's amendment as a way to lure away Dorgan's supporters. The North Dakotan has introduced his drug import amendment repeatedly over the last decade, only to see the Senate effectively kill it by adding requirements for safety guarantees.
"We've seen that before, and the pharmaceutical industry supports advancing this as a way to defeat importation," said Dorgan.
Many countries have price controls that let them charge lower prices than are common in the U.S.
Though Obama supported the importation of low-price drugs when he was running for the White House last year, the FDA last week criticized Dorgan's proposal for not doing enough to ensure that drugs entering the U.S. from abroad will be safe (Editor's emphasis throughout). Dorgan countered that his amendment had strong safeguards, allowing imports only of FDA-approved drugs from FDA-approved foreign plants.
White House officials have denied accusations by Dorgan's supporters that the administration was opposing importation as a way of retaining the drug industry's support for Obama's health care overhaul legislation, the president's top domestic priority.
In June, the industry agreed to provide consumers and the government with $80 billion in savings. Drug makers have spent tens of millions of dollars on TV ads promoting the health overhaul effort, making them one of the biggest advertisers in this year's health care fight, and the administration has little interest in antagonizing its ally.
The nonpartisan Congressional Budget office estimated that Dorgan's plan would have saved the federal government $19 billion over the coming decade. Dorgan says it would have saved American consumers four times that amount.
Editor's NOTE:
Big Pharma has once again succeeded in defeating a prescription drug bill which would have saved countless lives of Americans who cannot currently afford expensive medicines and saved the nation billions of dollars--all in the name of insuring unconscionable profits for the pharmaceutical industry. The "quality" excuse is a ruse as Senator Dorgan has rightly elucidated. This is an unapologetic attempt at maintaining a government guaranteed immoral monopoly.
--Dr. J. P. Hubert
Copenhagen Climate Conference
This is Bigger than Climate Change. It is a Battle to Redefine Humanity
It's hard for a species used to ever-expanding frontiers, but survival depends on accepting we live within limits
By George Monbiot
December 16, 2009 "The Guardian" Dec. 15, 2009 -- This is the moment at which we turn and face ourselves. Here, in the plastic corridors and crowded stalls, among impenetrable texts and withering procedures, humankind decides what it is and what it will become. It chooses whether to continue living as it has done, until it must make a wasteland of its home, or to stop and redefine itself. This is about much more than climate change. This is about us.
The meeting at Copenhagen confronts us with our primal tragedy. We are the universal ape, equipped with the ingenuity and aggression to bring down prey much larger than itself, break into new lands, roar its defiance of natural constraints. Now we find ourselves hedged in by the consequences of our nature, living meekly on this crowded planet for fear of provoking or damaging others. We have the hearts of lions and live the lives of clerks.
The summit's premise is that the age of heroism is over. We have entered the age of accommodation. No longer may we live without restraint. No longer may we swing our fists regardless of whose nose might be in the way. In everything we do we must now be mindful of the lives of others, cautious, constrained, meticulous. We may no longer live in the moment, as if there were no tomorrow.
This is a meeting about chemicals: the greenhouse gases insulating the atmosphere. But it is also a battle between two world views. The angry men who seek to derail this agreement, and all such limits on their self-fulfilment, have understood this better than we have. A new movement, most visible in North America and Australia, but now apparent everywhere, demands to trample on the lives of others as if this were a human right. It will not be constrained by taxes, gun laws, regulations, health and safety, especially by environmental restraints. It knows that fossil fuels have granted the universal ape amplification beyond its Palaeolithic dreams. For a moment, a marvellous, frontier moment, they allowed us to live in blissful mindlessness.
The angry men know that this golden age has gone; but they cannot find the words for the constraints they hate. Clutching their copies of Atlas Shrugged, they flail around, accusing those who would impede them of communism, fascism, religiosity, misanthropy, but knowing at heart that these restrictions are driven by something far more repulsive to the unrestrained man: the decencies we owe to other human beings.
I fear this chorus of bullies, but I also sympathise. I lead a mostly peaceful life, but my dreams are haunted by giant aurochs. All those of us whose blood still races are forced to sublimate, to fantasise. In daydreams and video games we find the lives that ecological limits and other people's interests forbid us to live.
Humanity is no longer split between conservatives and liberals, reactionaries and progressives, though both sides are informed by the older politics. Today the battle lines are drawn between expanders and restrainers; those who believe that there should be no impediments and those who believe that we must live within limits. The vicious battles we have seen so far between greens and climate change deniers, road safety campaigners and speed freaks, real grassroots groups and corporate-sponsored astroturfers are just the beginning. This war will become much uglier as people kick against the limits that decency demands.
So here we are, in the land of Beowulf's heroics, lost in a fog of acronyms and euphemisms, parentheses and exemptions, the deathly diplomacy required to accommodate everyone's demands. There is no space for heroism here; all passion and power breaks against the needs of others. This is how it should be, though every neurone revolts against it.
Although the delegates are waking up to the scale of their responsibility, I still believe they will sell us out. Everyone wants his last adventure. Hardly anyone among the official parties can accept the implications of living within our means, of living with tomorrow in mind. There will, they tell themselves, always be another frontier, another means to escape our constraints, to dump our dissatisfactions on other places and other people. Hanging over everything discussed here is the theme that dare not speak its name, always present but never mentioned. Economic growth is the magic formula which allows our conflicts to remain unresolved.
While economies grow, social justice is unnecessary, as lives can be improved without redistribution. While economies grow, people need not confront their elites. While economies grow, we can keep buying our way out of trouble. But, like the bankers, we stave off trouble today only by multiplying it tomorrow. Through economic growth we are borrowing time at punitive rates of interest. It ensures that any cuts agreed at Copenhagen will eventually be outstripped. Even if we manage to prevent climate breakdown, growth means that it's only a matter of time before we hit a new constraint, which demands a new global response: oil, water, phosphate, soil. We will lurch from crisis to existential crisis unless we address the underlying cause: perpetual growth cannot be accommodated on a finite planet.
For all their earnest self-restraint, the negotiators in the plastic city are still not serious, even about climate change. There's another great unmentionable here: supply. Most of the nation states tussling at Copenhagen have two fossil fuel policies. One is to minimise demand, by encouraging us to reduce our consumption. The other is to maximise supply, by encouraging companies to extract as much from the ground as they can.
We know, from the papers published in Nature in April, that we can use a maximum of 60% of current reserves of coal, oil and gas if the average global temperature is not to rise by more than two degrees. We can burn much less if, as many poorer countries now insist, we seek to prevent the temperature from rising by more than 1.5C. We know that capture and storage will dispose of just a small fraction of the carbon in these fuels. There are two obvious conclusions: governments must decide which existing reserves of fossil fuel are to be left in the ground, and they must introduce a global moratorium on prospecting for new reserves. Neither of these proposals has even been mooted for discussion (Editor's emphasis throughout).
But somehow this first great global battle between expanders and restrainers must be won and then the battles that lie beyond it – rising consumption, corporate power, economic growth – must begin. If governments don't show some resolve on climate change, the expanders will seize on the restrainers' weakness. They will attack – using the same tactics of denial, obfuscation and appeals to self-interest – the other measures that protect people from each other, or which prevent the world's ecosystems from being destroyed. There is no end to this fight, no line these people will not cross. They too are aware that this a battle to redefine humanity, and they wish to redefine it as a species even more rapacious than it is today.
It's hard for a species used to ever-expanding frontiers, but survival depends on accepting we live within limits
By George Monbiot
December 16, 2009 "The Guardian" Dec. 15, 2009 -- This is the moment at which we turn and face ourselves. Here, in the plastic corridors and crowded stalls, among impenetrable texts and withering procedures, humankind decides what it is and what it will become. It chooses whether to continue living as it has done, until it must make a wasteland of its home, or to stop and redefine itself. This is about much more than climate change. This is about us.
The meeting at Copenhagen confronts us with our primal tragedy. We are the universal ape, equipped with the ingenuity and aggression to bring down prey much larger than itself, break into new lands, roar its defiance of natural constraints. Now we find ourselves hedged in by the consequences of our nature, living meekly on this crowded planet for fear of provoking or damaging others. We have the hearts of lions and live the lives of clerks.
The summit's premise is that the age of heroism is over. We have entered the age of accommodation. No longer may we live without restraint. No longer may we swing our fists regardless of whose nose might be in the way. In everything we do we must now be mindful of the lives of others, cautious, constrained, meticulous. We may no longer live in the moment, as if there were no tomorrow.
This is a meeting about chemicals: the greenhouse gases insulating the atmosphere. But it is also a battle between two world views. The angry men who seek to derail this agreement, and all such limits on their self-fulfilment, have understood this better than we have. A new movement, most visible in North America and Australia, but now apparent everywhere, demands to trample on the lives of others as if this were a human right. It will not be constrained by taxes, gun laws, regulations, health and safety, especially by environmental restraints. It knows that fossil fuels have granted the universal ape amplification beyond its Palaeolithic dreams. For a moment, a marvellous, frontier moment, they allowed us to live in blissful mindlessness.
The angry men know that this golden age has gone; but they cannot find the words for the constraints they hate. Clutching their copies of Atlas Shrugged, they flail around, accusing those who would impede them of communism, fascism, religiosity, misanthropy, but knowing at heart that these restrictions are driven by something far more repulsive to the unrestrained man: the decencies we owe to other human beings.
I fear this chorus of bullies, but I also sympathise. I lead a mostly peaceful life, but my dreams are haunted by giant aurochs. All those of us whose blood still races are forced to sublimate, to fantasise. In daydreams and video games we find the lives that ecological limits and other people's interests forbid us to live.
Humanity is no longer split between conservatives and liberals, reactionaries and progressives, though both sides are informed by the older politics. Today the battle lines are drawn between expanders and restrainers; those who believe that there should be no impediments and those who believe that we must live within limits. The vicious battles we have seen so far between greens and climate change deniers, road safety campaigners and speed freaks, real grassroots groups and corporate-sponsored astroturfers are just the beginning. This war will become much uglier as people kick against the limits that decency demands.
So here we are, in the land of Beowulf's heroics, lost in a fog of acronyms and euphemisms, parentheses and exemptions, the deathly diplomacy required to accommodate everyone's demands. There is no space for heroism here; all passion and power breaks against the needs of others. This is how it should be, though every neurone revolts against it.
Although the delegates are waking up to the scale of their responsibility, I still believe they will sell us out. Everyone wants his last adventure. Hardly anyone among the official parties can accept the implications of living within our means, of living with tomorrow in mind. There will, they tell themselves, always be another frontier, another means to escape our constraints, to dump our dissatisfactions on other places and other people. Hanging over everything discussed here is the theme that dare not speak its name, always present but never mentioned. Economic growth is the magic formula which allows our conflicts to remain unresolved.
While economies grow, social justice is unnecessary, as lives can be improved without redistribution. While economies grow, people need not confront their elites. While economies grow, we can keep buying our way out of trouble. But, like the bankers, we stave off trouble today only by multiplying it tomorrow. Through economic growth we are borrowing time at punitive rates of interest. It ensures that any cuts agreed at Copenhagen will eventually be outstripped. Even if we manage to prevent climate breakdown, growth means that it's only a matter of time before we hit a new constraint, which demands a new global response: oil, water, phosphate, soil. We will lurch from crisis to existential crisis unless we address the underlying cause: perpetual growth cannot be accommodated on a finite planet.
For all their earnest self-restraint, the negotiators in the plastic city are still not serious, even about climate change. There's another great unmentionable here: supply. Most of the nation states tussling at Copenhagen have two fossil fuel policies. One is to minimise demand, by encouraging us to reduce our consumption. The other is to maximise supply, by encouraging companies to extract as much from the ground as they can.
We know, from the papers published in Nature in April, that we can use a maximum of 60% of current reserves of coal, oil and gas if the average global temperature is not to rise by more than two degrees. We can burn much less if, as many poorer countries now insist, we seek to prevent the temperature from rising by more than 1.5C. We know that capture and storage will dispose of just a small fraction of the carbon in these fuels. There are two obvious conclusions: governments must decide which existing reserves of fossil fuel are to be left in the ground, and they must introduce a global moratorium on prospecting for new reserves. Neither of these proposals has even been mooted for discussion (Editor's emphasis throughout).
But somehow this first great global battle between expanders and restrainers must be won and then the battles that lie beyond it – rising consumption, corporate power, economic growth – must begin. If governments don't show some resolve on climate change, the expanders will seize on the restrainers' weakness. They will attack – using the same tactics of denial, obfuscation and appeals to self-interest – the other measures that protect people from each other, or which prevent the world's ecosystems from being destroyed. There is no end to this fight, no line these people will not cross. They too are aware that this a battle to redefine humanity, and they wish to redefine it as a species even more rapacious than it is today.
White House as Helpless Victim on Healthcare
By Glenn Greenwald
December 16, 2009 "Salon" -- Of all the posts I wrote this year, the one that produced the most vociferious email backlash -- easily -- was this one from August, which examined substantial evidence showing that, contrary to Obama's occasional public statements in support of a public option, the White House clearly intended from the start that the final health care reform bill would contain no such provision and was actively and privately participating in efforts to shape a final bill without it. From the start, assuaging the health insurance and pharmaceutical industries was a central preoccupation of the White House -- hence the deal negotiated in strict secrecy with Pharma to ban bulk price negotiations and drug reimportation, a blatant violation of both Obama's campaign positions on those issues and his promise to conduct all negotiations out in the open (on C-SPAN). Indeed, Democrats led the way yesterday in killing drug re-importation, which they endlessly claimed to support back when they couldn't pass it. The administration wants not only to prevent industry money from funding an anti-health-care-reform campaign, but also wants to ensure that the Democratic Party -- rather than the GOP -- will continue to be the prime recipient of industry largesse.
As was painfully predictable all along, the final bill will not have any form of public option, nor will it include the wildly popular expansion of Medicare coverage. Obama supporters are eager to depict the White House as nothing more than a helpless victim in all of this -- the President so deeply wanted a more progressive bill but was sadly thwarted in his noble efforts by those inhumane, corrupt Congressional "centrists." Right. The evidence was overwhelming from the start that the White House was not only indifferent, but opposed, to the provisions most important to progressives. The administration is getting the bill which they, more or less, wanted from the start -- the one that is a huge boon to the health insurance and pharmaceutical industry. And kudos to Russ Feingold for saying so:
Sen. Russ Feingold (D-Wis.), among the most vocal supporters of the public option, said it would be unfair to blame Lieberman for its apparent demise. Feingold said that responsibility ultimately rests with President Barack Obama and he could have insisted on a higher standard for the legislation.
"This bill appears to be legislation that the president wanted in the first place, so I don't think focusing it on Lieberman really hits the truth," said Feingold. "I think they could have been higher. I certainly think a stronger bill would have been better in every respect."
Let's repeat that: "This bill appears to be legislation that the president wanted in the first place." Indeed it does. There are rational, practical reasons why that might be so. If you're interested in preserving and expanding political power, then, all other things being equal, it's better to have the pharmaceutical and health insurance industry on your side than opposed to you. Or perhaps they calculated from the start that this was the best bill they could get. The wisdom of that rationale can be debated, but depicting Obama as the impotent progressive victim here of recalcitrant, corrupt centrists is really too much to bear.
Yet numerous Obama defenders -- such as Matt Yglesias, Ezra Klein and Steve Benen -- have been insisting that there is just nothing the White House could have done and all of this shows that our political system is tragically "ungovernable." After all, Congress is a separate branch of government, Obama doesn't have a vote, and 60 votes are needed to do anything. How is it his fault if centrist Senators won't support what he wants to do? Apparently, this is the type of conversation we're to believe takes place in the Oval Office:
The President: I really want a public option and Medicare buy-in. What can we do to get it?
Rahm Emanuel: Unfortunately, nothing. We can just sit by and hope, but you're not in Congress any more and you don't have a vote. They're a separate branch of government and we have to respect that.
The President: So we have no role to play in what the Democratic Congress does?
Emanuel: No. Members of Congress make up their own minds and there's just nothing we can do to influence or pressure them.
The President: Gosh, that's too bad. Let's just keep our fingers crossed and see what happens then.
In an ideal world, Congress would be -- and should be -- an autonomous branch of government, exercising judgment independent of the White House's influence, but that's not the world we live in. Does anyone actually believe that Rahm Emanuel (who built his career on industry support for the Party and jamming "centrist" bills through Congress with the support of Blue Dogs) and Barack Obama (who attached himself to Joe Lieberman when arriving in the Senate, repeatedly proved himself receptive to "centrist" compromises, had a campaign funded by corporate interests, and is now the leader of a vast funding and political infrastructure) were the helpless victims of those same forces? Engineering these sorts of "centrist," industry-serving compromises has been the modus operandi of both Obama and, especially, Emanuel.
Indeed, we've seen before what the White House can do -- and does do -- when they actually care about pressuring members of Congress to support something they genuinely want passed. When FDL and other liberal blogs led an effort to defeat Obama's war funding bill back in June, the White House became desperate for votes, and here is what they apparently did (though they deny it):
The White House is playing hardball with Democrats who intend to vote against the supplemental war spending bill, threatening freshmen who oppose it that they won't get help with reelection and will be cut off from the White House, Rep. Lynn Woolsey (D-Calif.) said Friday. "We're not going to help you. You'll never hear from us again," Woolsey said the White House is telling freshmen.
That's what the White House can do when they actually care about pressuring someone to vote the way they want. Why didn't they do any of that to the "centrists" who were supposedly obstructing what they wanted on health care? Why didn't they tell Blanche Lincoln -- in a desperate fight for her political life -- that she would "never hear from them again," and would lose DNC and other Democratic institutional support, if she filibustered the public option? Why haven't they threatened to remove Joe Lieberman's cherished Homeland Security Chairmanship if he's been sabotaging the President's agenda? Why hasn't the President been rhetorically pressuring Senators to support the public option and Medicare buy-in, or taking any of the other steps outlined here by Adam Green? There's no guarantee that it would have worked -- Obama is not omnipotent and he can't always control Congressional outcomes -- but the lack of any such efforts is extremely telling about what the White House really wanted here.
Independent of the reasonable debate over whether this bill is a marginal improvement over the status quo, there are truly horrible elements to it. Two of the most popular provisions (both of which, not coincidentally, were highly adverse to industry interests) -- the public option and Medicare expansion -- are stripped out (a new Washington Post/ABC poll out today shows that the public favors expansion of Medicare to age 55 by a 30-point margin). What remains is a politically distastrous and highly coercive "mandate" gift to the health insurance industry, described perfectly by Digby:
Obama can say that you're getting a lot, but also saying that it "covers everyone," as if there's a big new benefit is a big stretch. Nothing will have changed on that count except changing the law to force people to buy private insurance if they don't get it from their employer. I guess you can call that progressive, but that doesn't make it so. In fact, mandating that all people pay money to a private interest isn't even conservative, free market or otherwise. It's some kind of weird corporatism that's very hard to square with the common good philosophy that Democrats supposedly espouse.
Nobody's "getting covered" here. After all, people are already "free" to buy private insurance and one must assume they have reasons for not doing it already. Whether those reasons are good or bad won't make a difference when they are suddenly forced to write big checks to Aetna or Blue Cross that they previously had decided they couldn't or didn't want to write. Indeed, it actually looks like the worst caricature of liberals: taking people's money against their will, saying it's for their own good --- and doing it without even the cover that FDR wisely insisted upon with social security, by having it withdrawn from paychecks. People don't miss the money as much when they never see it.
In essence, this re-inforces all of the worst dynamics of Washington. The insurance industry gets the biggest bonanza imaginable in the form of tens of millions of coerced new customers without any competition or other price controls. Progressive opinion-makers, as always, signaled that they can and should be ignored (don't worry about us -- we're announcing in advance that we'll support whatever you feed us no matter how little it contains of what we want and will never exercise raw political power to get what we want; make sure those other people are happy but ignore us). Most of this was negotiated and effectuated in complete secrecy, in the sleazy sewers populated by lobbyists, industry insiders, and their wholly-owned pawns in the Congress. And highly unpopular, industry-serving legislation is passed off as "centrist," the noblest Beltway value.
Looked at from the narrow lens of health care policy, there is a reasonable debate to be had among reform advocates over whether this bill is a net benefit or a net harm. But the idea that the White House did what it could to ensure the inclusion of progressive provisions -- or that they were powerless to do anything about it -- is absurd on its face. Whatever else is true, the overwhelming evidence points to exactly what Sen. Feingold said yesterday: "This bill appears to be legislation that the president wanted in the first place." (editor's emphasis throughout)
December 16, 2009 "Salon" -- Of all the posts I wrote this year, the one that produced the most vociferious email backlash -- easily -- was this one from August, which examined substantial evidence showing that, contrary to Obama's occasional public statements in support of a public option, the White House clearly intended from the start that the final health care reform bill would contain no such provision and was actively and privately participating in efforts to shape a final bill without it. From the start, assuaging the health insurance and pharmaceutical industries was a central preoccupation of the White House -- hence the deal negotiated in strict secrecy with Pharma to ban bulk price negotiations and drug reimportation, a blatant violation of both Obama's campaign positions on those issues and his promise to conduct all negotiations out in the open (on C-SPAN). Indeed, Democrats led the way yesterday in killing drug re-importation, which they endlessly claimed to support back when they couldn't pass it. The administration wants not only to prevent industry money from funding an anti-health-care-reform campaign, but also wants to ensure that the Democratic Party -- rather than the GOP -- will continue to be the prime recipient of industry largesse.
As was painfully predictable all along, the final bill will not have any form of public option, nor will it include the wildly popular expansion of Medicare coverage. Obama supporters are eager to depict the White House as nothing more than a helpless victim in all of this -- the President so deeply wanted a more progressive bill but was sadly thwarted in his noble efforts by those inhumane, corrupt Congressional "centrists." Right. The evidence was overwhelming from the start that the White House was not only indifferent, but opposed, to the provisions most important to progressives. The administration is getting the bill which they, more or less, wanted from the start -- the one that is a huge boon to the health insurance and pharmaceutical industry. And kudos to Russ Feingold for saying so:
Sen. Russ Feingold (D-Wis.), among the most vocal supporters of the public option, said it would be unfair to blame Lieberman for its apparent demise. Feingold said that responsibility ultimately rests with President Barack Obama and he could have insisted on a higher standard for the legislation.
"This bill appears to be legislation that the president wanted in the first place, so I don't think focusing it on Lieberman really hits the truth," said Feingold. "I think they could have been higher. I certainly think a stronger bill would have been better in every respect."
Let's repeat that: "This bill appears to be legislation that the president wanted in the first place." Indeed it does. There are rational, practical reasons why that might be so. If you're interested in preserving and expanding political power, then, all other things being equal, it's better to have the pharmaceutical and health insurance industry on your side than opposed to you. Or perhaps they calculated from the start that this was the best bill they could get. The wisdom of that rationale can be debated, but depicting Obama as the impotent progressive victim here of recalcitrant, corrupt centrists is really too much to bear.
Yet numerous Obama defenders -- such as Matt Yglesias, Ezra Klein and Steve Benen -- have been insisting that there is just nothing the White House could have done and all of this shows that our political system is tragically "ungovernable." After all, Congress is a separate branch of government, Obama doesn't have a vote, and 60 votes are needed to do anything. How is it his fault if centrist Senators won't support what he wants to do? Apparently, this is the type of conversation we're to believe takes place in the Oval Office:
The President: I really want a public option and Medicare buy-in. What can we do to get it?
Rahm Emanuel: Unfortunately, nothing. We can just sit by and hope, but you're not in Congress any more and you don't have a vote. They're a separate branch of government and we have to respect that.
The President: So we have no role to play in what the Democratic Congress does?
Emanuel: No. Members of Congress make up their own minds and there's just nothing we can do to influence or pressure them.
The President: Gosh, that's too bad. Let's just keep our fingers crossed and see what happens then.
In an ideal world, Congress would be -- and should be -- an autonomous branch of government, exercising judgment independent of the White House's influence, but that's not the world we live in. Does anyone actually believe that Rahm Emanuel (who built his career on industry support for the Party and jamming "centrist" bills through Congress with the support of Blue Dogs) and Barack Obama (who attached himself to Joe Lieberman when arriving in the Senate, repeatedly proved himself receptive to "centrist" compromises, had a campaign funded by corporate interests, and is now the leader of a vast funding and political infrastructure) were the helpless victims of those same forces? Engineering these sorts of "centrist," industry-serving compromises has been the modus operandi of both Obama and, especially, Emanuel.
Indeed, we've seen before what the White House can do -- and does do -- when they actually care about pressuring members of Congress to support something they genuinely want passed. When FDL and other liberal blogs led an effort to defeat Obama's war funding bill back in June, the White House became desperate for votes, and here is what they apparently did (though they deny it):
The White House is playing hardball with Democrats who intend to vote against the supplemental war spending bill, threatening freshmen who oppose it that they won't get help with reelection and will be cut off from the White House, Rep. Lynn Woolsey (D-Calif.) said Friday. "We're not going to help you. You'll never hear from us again," Woolsey said the White House is telling freshmen.
That's what the White House can do when they actually care about pressuring someone to vote the way they want. Why didn't they do any of that to the "centrists" who were supposedly obstructing what they wanted on health care? Why didn't they tell Blanche Lincoln -- in a desperate fight for her political life -- that she would "never hear from them again," and would lose DNC and other Democratic institutional support, if she filibustered the public option? Why haven't they threatened to remove Joe Lieberman's cherished Homeland Security Chairmanship if he's been sabotaging the President's agenda? Why hasn't the President been rhetorically pressuring Senators to support the public option and Medicare buy-in, or taking any of the other steps outlined here by Adam Green? There's no guarantee that it would have worked -- Obama is not omnipotent and he can't always control Congressional outcomes -- but the lack of any such efforts is extremely telling about what the White House really wanted here.
Independent of the reasonable debate over whether this bill is a marginal improvement over the status quo, there are truly horrible elements to it. Two of the most popular provisions (both of which, not coincidentally, were highly adverse to industry interests) -- the public option and Medicare expansion -- are stripped out (a new Washington Post/ABC poll out today shows that the public favors expansion of Medicare to age 55 by a 30-point margin). What remains is a politically distastrous and highly coercive "mandate" gift to the health insurance industry, described perfectly by Digby:
Obama can say that you're getting a lot, but also saying that it "covers everyone," as if there's a big new benefit is a big stretch. Nothing will have changed on that count except changing the law to force people to buy private insurance if they don't get it from their employer. I guess you can call that progressive, but that doesn't make it so. In fact, mandating that all people pay money to a private interest isn't even conservative, free market or otherwise. It's some kind of weird corporatism that's very hard to square with the common good philosophy that Democrats supposedly espouse.
Nobody's "getting covered" here. After all, people are already "free" to buy private insurance and one must assume they have reasons for not doing it already. Whether those reasons are good or bad won't make a difference when they are suddenly forced to write big checks to Aetna or Blue Cross that they previously had decided they couldn't or didn't want to write. Indeed, it actually looks like the worst caricature of liberals: taking people's money against their will, saying it's for their own good --- and doing it without even the cover that FDR wisely insisted upon with social security, by having it withdrawn from paychecks. People don't miss the money as much when they never see it.
In essence, this re-inforces all of the worst dynamics of Washington. The insurance industry gets the biggest bonanza imaginable in the form of tens of millions of coerced new customers without any competition or other price controls. Progressive opinion-makers, as always, signaled that they can and should be ignored (don't worry about us -- we're announcing in advance that we'll support whatever you feed us no matter how little it contains of what we want and will never exercise raw political power to get what we want; make sure those other people are happy but ignore us). Most of this was negotiated and effectuated in complete secrecy, in the sleazy sewers populated by lobbyists, industry insiders, and their wholly-owned pawns in the Congress. And highly unpopular, industry-serving legislation is passed off as "centrist," the noblest Beltway value.
Looked at from the narrow lens of health care policy, there is a reasonable debate to be had among reform advocates over whether this bill is a net benefit or a net harm. But the idea that the White House did what it could to ensure the inclusion of progressive provisions -- or that they were powerless to do anything about it -- is absurd on its face. Whatever else is true, the overwhelming evidence points to exactly what Sen. Feingold said yesterday: "This bill appears to be legislation that the president wanted in the first place." (editor's emphasis throughout)
Friday, December 18, 2009
Copenhagen: Only the Numbers Count – and They Add up to Hell on Earth
Climate Interactive's software speaks numbers, not spin – which is where the true understanding of the Copenhagen summit lies.
By Bill McKibben
December 15, 2009 "The Guardian" - - The Bella centre is a swirl of chatter, the streets of Copenhagen are a swirl of protest. Depending on what hour you listen to the news bulletin, the UN climate negotiations have "come off the rails" or are "back on track" or have "stalled" or are "moving swiftly". Which is why the only people who really understand what's going on may be a small crew of folks from a group of computer jockeys called Climate Interactive. Their software speaks numbers, not spin – and in the end it's the numbers that count.
First number to know: 350. It's what scientists have been saying for two years is the maximum amount of carbon dioxide we can safely have in the atmosphere, measured in parts per million. Those scientists have been joined by an unprecedented outpouring from civil society: in late October, activists put on what CNN called "the most widespread day of political action in the planet's history," with 5,200 demonstrations in 181 countries, all rallying around that number. Three thousand vigils last weekend across the planet spelled out the number in candles. Thousands of churches rang their bells 350 times on Sunday, and yesterday the World Parliament of Religions, meeting in Melbourne and representing the "largest interreligious gathering on earth" sent an emergency 350 declaration here to Copenhagen.
The second number: 100. That's (roughly) how many countries are backing a 350 target here at Copenhagen. That's more than half the nations in attendance – unfortunately, they're the small, poor ones. But it's amazing to see them, in the face of enormous pressure, keeping the idea of real action alive. Yesterday Mohamed Nasheed, president of the Maldives, spoke to a roaring crowd of thousands: "We know what the laws of physics say: the most important number in the world is 350."
The third number: 4%. That's how much the US is offering to cut its emissions from their 1990 levels by 2020. Scientists tell us that the developed world would need to reduce by at least 40% to get us back on a 350 track, so the American offer is exactly an order or magnitude off. And they're not alone. All the rich countries, not to mention China, are looking to do as little as possible and still escape here with some kind of agreement they can hide behind.
The fourth number – and the most important one. When the folks at Climate Interactive plug in every promise made at these talks (the American offer on the table, the Chinese promise to reduce "energy intensity", the EU pledges, and so on) their software tells them almost instantly how much carbon they would eventually produce. When they hit the button last night, the program showed that by 2100 the world's CO2 concentrations (currently 390) would be – drumroll please – 770. That is, we would live in hell, or at least a place with a similar temperature.
So that's the scorecard. You may hear a lot of happy talk from world leaders over the next few days as they "reach a historic agreement". But that's how it all adds up.
By Bill McKibben
December 15, 2009 "The Guardian" - - The Bella centre is a swirl of chatter, the streets of Copenhagen are a swirl of protest. Depending on what hour you listen to the news bulletin, the UN climate negotiations have "come off the rails" or are "back on track" or have "stalled" or are "moving swiftly". Which is why the only people who really understand what's going on may be a small crew of folks from a group of computer jockeys called Climate Interactive. Their software speaks numbers, not spin – and in the end it's the numbers that count.
First number to know: 350. It's what scientists have been saying for two years is the maximum amount of carbon dioxide we can safely have in the atmosphere, measured in parts per million. Those scientists have been joined by an unprecedented outpouring from civil society: in late October, activists put on what CNN called "the most widespread day of political action in the planet's history," with 5,200 demonstrations in 181 countries, all rallying around that number. Three thousand vigils last weekend across the planet spelled out the number in candles. Thousands of churches rang their bells 350 times on Sunday, and yesterday the World Parliament of Religions, meeting in Melbourne and representing the "largest interreligious gathering on earth" sent an emergency 350 declaration here to Copenhagen.
The second number: 100. That's (roughly) how many countries are backing a 350 target here at Copenhagen. That's more than half the nations in attendance – unfortunately, they're the small, poor ones. But it's amazing to see them, in the face of enormous pressure, keeping the idea of real action alive. Yesterday Mohamed Nasheed, president of the Maldives, spoke to a roaring crowd of thousands: "We know what the laws of physics say: the most important number in the world is 350."
The third number: 4%. That's how much the US is offering to cut its emissions from their 1990 levels by 2020. Scientists tell us that the developed world would need to reduce by at least 40% to get us back on a 350 track, so the American offer is exactly an order or magnitude off. And they're not alone. All the rich countries, not to mention China, are looking to do as little as possible and still escape here with some kind of agreement they can hide behind.
The fourth number – and the most important one. When the folks at Climate Interactive plug in every promise made at these talks (the American offer on the table, the Chinese promise to reduce "energy intensity", the EU pledges, and so on) their software tells them almost instantly how much carbon they would eventually produce. When they hit the button last night, the program showed that by 2100 the world's CO2 concentrations (currently 390) would be – drumroll please – 770. That is, we would live in hell, or at least a place with a similar temperature.
So that's the scorecard. You may hear a lot of happy talk from world leaders over the next few days as they "reach a historic agreement". But that's how it all adds up.
2010: "The Year of Severe Economic Contraction"
By Mike Whitney
Global Research,
December 15, 2009
Upbeat reports in the financial media, belie the effects of the ongoing credit contraction. Massive injections of central bank liquidity have prevented the collapse of financial markets, but have done little to ease the deleveraging of households or stimulate activity the broader economy. The crisis has stripped $13 trillion in equity from working families who now find their access to credit either cut off or severely curtailed by the same banks that received hefty taxpayer-funded bailouts. The fiscal strangulation of the millions of people who are no longer considered "creditworthy" is progressively weakening demand and spreading pessimism across all income levels. Growing public desperation was the focus of a special weekend report by Bloomberg News:
"Americans have grown gloomier about both the economy and the nation's direction over the past three months even as the U.S. shows signs of moving from recession to recovery. Almost half the people now feel less financially secure than when President Barack Obama took office in January, a Bloomberg National Poll shows.
The economy is the country's top concern, with persistently high unemployment the greatest threat the public sees. Eight of 10 Americans rate joblessness a high risk to the economy in the next two years, outranking the federal budget deficit, which is cited by 7 of 10. An increase in taxes is named as a high risk by almost 6 of 10.
Fewer than 1 in 3 Americans think the economy will improve in the next six months....Only 32 percent of poll respondents believe the country is headed in the right direction, down from 40 percent who said so in September." (Bloomberg)
The near-delirious optimism that followed the 2008 presidential election has fizzled in less than 12 months. While the policies of the Obama administration have improved Wall Street's prospects for record profits and lavish bonuses, ordinary working people continue to fight to keep their jobs and maintain their standard of living. Recent data show that household debt which surged during the boom years is being pared back at a historic pace. Household debt to disposable income has plummeted from 136 percent to 122 percent in a little more than a year, leaving many families with little to spend at the malls or shopping centers.
Severe retrenchment has triggered a shift towards personal thriftiness which is reducing economic activity and strengthening deflationary pressures. 2010 is likely to be even worse, as mushrooming foreclosures and commercial real estate defaults force banks to slash lending accelerating the rate of decline. This is from Bloomberg:
"Foreclosure filings in the U.S. will reach a record for the second consecutive year with 3.9 million notices sent to homeowners in default, RealtyTrac Inc. said. This year's filings will surpass 2008's total of 3.2 million as record unemployment and price erosion batter the housing market...
Foreclosure filings exceeded 300,000 for the ninth straight month in November, RealtyTrac said today. A weak labor market and tight credit are "formidable headwinds" for the economy, Federal Reserve Chairman Ben S. Bernanke said in a Dec. 7 speech in Washington. The 7.2 million jobs lost since the recession began in December 2007 are the most of any postwar economic slump, Labor Department data show. Unemployment, at 10 percent last month, won't peak until the first quarter, Quigley said." (Bloomberg)
The Obama administration's $787 billion stimulus pushed GDP into positive territory for the first time in more than a year, but the maximum impact has already been felt. President Obama--under advice from his chief advisors-- has shifted his focus from soaring unemployment to long-term deficits. Additional stimulus will be no more than $200 billion, of which, a mere $50 billion will go towards jobs initiatives. At the same time, Fed chair Ben Bernanke will terminate the quantitative easing (QE) program which kept long-term interest rates low while providing financing for the housing market. When the program ends, rates will rise, housing prices will tumble, and liquidity will drain from the system. The end of QE coupled with dwindling stimulus ensures that economy will slide back into recession in the 2nd or 3rd Quarter of 2010.
Policymakers have decided to create conditions that are favorable to financial sector consolidation and the further privatization of public assets. The economy is being strangled by design.
Here's economist Mark Thoma explaining why consumption will not return to pre-crisis levels:
"For the immediate future and likely for much longer than that, slow consumption growth is expected. One way that could change is if the government implements a successful jobs program or uses some other means to increase household income (e.g. a payroll tax cut), and households spend rather than save the extra income..., but the political environment makes a jobs program or further fiscal policy action highly unlikely.
Similarly...the Fed is anxious to unwind its massive policy intervention, not extend it, so monetary policy is unlikely to help much either. Since monetary and fiscal policy authorities are unwilling to provide further help, slow growth is the best outcome we're likely to get." ("Will Consumption Growth Return to Its Pre-Recession Level?" Mark Thoma, moneywatch.com)
Along with flagging consumption, economists Antonio Fatas and Ilian Mihov show why both investment and employment will not rebound in the way that many bullish analysts expect. By tracking the rate of recovery in the last 5 recessions, the two economists show that demand will remain flat for a prolonged period of time, precipitating a "jobless" and "investmentless" recovery. Their research supports additional stimulus to reduce the output gap and engage the labor force in productive activity. The administration's policies are the exact opposite of the majority of professional economists who believe that deficits need to increase to effect overcapacity and underutilization. Obama is deliberately steering the economy into a double-dip recession.
While financial institutions have been propped up with zero-rates, myriad lending facilities and boatloads of Fed liquidity, the real economy continues to on a downward path. As households rebalance accounts and increase savings, the signs of distress are becoming more apparent. In Europe, the ECB and IMF have begun to use the financial crisis to wrest control of the budgets of deficits-plagued nations to apply business-friendly austerity measures. The economic meltdown--that was generated by overleveraged banks trading dodgy investment paper--is now being used to assert corporate/bank control over sovereign nations. Greece, Ireland, Iceland, Ukraine, Latvia, Lithuania, Portugal and Spain are all presently in the crosshairs of neoliberal restructuring. Surely, the same policies will be applied within the United States under the guidance of supply-side economist and chief advisor to the president, Lawrence Summers. Thus, in 2010, economic contraction will continue to force state and local governmnets to lay off millions of more workers while public assets and services are made available at firesale prices to private industry.
Debt deflation and deleveraging will continue into 2011, while foreclosures, personal bankruptcies and defaults continue to mount. The public's frustration with ineffective government policies, is likely to change from pessimism to rage on short notice. The prospect of social unrest or sporadic incidents of violence can no longer be excluded.
Global Research,
December 15, 2009
Upbeat reports in the financial media, belie the effects of the ongoing credit contraction. Massive injections of central bank liquidity have prevented the collapse of financial markets, but have done little to ease the deleveraging of households or stimulate activity the broader economy. The crisis has stripped $13 trillion in equity from working families who now find their access to credit either cut off or severely curtailed by the same banks that received hefty taxpayer-funded bailouts. The fiscal strangulation of the millions of people who are no longer considered "creditworthy" is progressively weakening demand and spreading pessimism across all income levels. Growing public desperation was the focus of a special weekend report by Bloomberg News:
"Americans have grown gloomier about both the economy and the nation's direction over the past three months even as the U.S. shows signs of moving from recession to recovery. Almost half the people now feel less financially secure than when President Barack Obama took office in January, a Bloomberg National Poll shows.
The economy is the country's top concern, with persistently high unemployment the greatest threat the public sees. Eight of 10 Americans rate joblessness a high risk to the economy in the next two years, outranking the federal budget deficit, which is cited by 7 of 10. An increase in taxes is named as a high risk by almost 6 of 10.
Fewer than 1 in 3 Americans think the economy will improve in the next six months....Only 32 percent of poll respondents believe the country is headed in the right direction, down from 40 percent who said so in September." (Bloomberg)
The near-delirious optimism that followed the 2008 presidential election has fizzled in less than 12 months. While the policies of the Obama administration have improved Wall Street's prospects for record profits and lavish bonuses, ordinary working people continue to fight to keep their jobs and maintain their standard of living. Recent data show that household debt which surged during the boom years is being pared back at a historic pace. Household debt to disposable income has plummeted from 136 percent to 122 percent in a little more than a year, leaving many families with little to spend at the malls or shopping centers.
Severe retrenchment has triggered a shift towards personal thriftiness which is reducing economic activity and strengthening deflationary pressures. 2010 is likely to be even worse, as mushrooming foreclosures and commercial real estate defaults force banks to slash lending accelerating the rate of decline. This is from Bloomberg:
"Foreclosure filings in the U.S. will reach a record for the second consecutive year with 3.9 million notices sent to homeowners in default, RealtyTrac Inc. said. This year's filings will surpass 2008's total of 3.2 million as record unemployment and price erosion batter the housing market...
Foreclosure filings exceeded 300,000 for the ninth straight month in November, RealtyTrac said today. A weak labor market and tight credit are "formidable headwinds" for the economy, Federal Reserve Chairman Ben S. Bernanke said in a Dec. 7 speech in Washington. The 7.2 million jobs lost since the recession began in December 2007 are the most of any postwar economic slump, Labor Department data show. Unemployment, at 10 percent last month, won't peak until the first quarter, Quigley said." (Bloomberg)
The Obama administration's $787 billion stimulus pushed GDP into positive territory for the first time in more than a year, but the maximum impact has already been felt. President Obama--under advice from his chief advisors-- has shifted his focus from soaring unemployment to long-term deficits. Additional stimulus will be no more than $200 billion, of which, a mere $50 billion will go towards jobs initiatives. At the same time, Fed chair Ben Bernanke will terminate the quantitative easing (QE) program which kept long-term interest rates low while providing financing for the housing market. When the program ends, rates will rise, housing prices will tumble, and liquidity will drain from the system. The end of QE coupled with dwindling stimulus ensures that economy will slide back into recession in the 2nd or 3rd Quarter of 2010.
Policymakers have decided to create conditions that are favorable to financial sector consolidation and the further privatization of public assets. The economy is being strangled by design.
Here's economist Mark Thoma explaining why consumption will not return to pre-crisis levels:
"For the immediate future and likely for much longer than that, slow consumption growth is expected. One way that could change is if the government implements a successful jobs program or uses some other means to increase household income (e.g. a payroll tax cut), and households spend rather than save the extra income..., but the political environment makes a jobs program or further fiscal policy action highly unlikely.
Similarly...the Fed is anxious to unwind its massive policy intervention, not extend it, so monetary policy is unlikely to help much either. Since monetary and fiscal policy authorities are unwilling to provide further help, slow growth is the best outcome we're likely to get." ("Will Consumption Growth Return to Its Pre-Recession Level?" Mark Thoma, moneywatch.com)
Along with flagging consumption, economists Antonio Fatas and Ilian Mihov show why both investment and employment will not rebound in the way that many bullish analysts expect. By tracking the rate of recovery in the last 5 recessions, the two economists show that demand will remain flat for a prolonged period of time, precipitating a "jobless" and "investmentless" recovery. Their research supports additional stimulus to reduce the output gap and engage the labor force in productive activity. The administration's policies are the exact opposite of the majority of professional economists who believe that deficits need to increase to effect overcapacity and underutilization. Obama is deliberately steering the economy into a double-dip recession.
While financial institutions have been propped up with zero-rates, myriad lending facilities and boatloads of Fed liquidity, the real economy continues to on a downward path. As households rebalance accounts and increase savings, the signs of distress are becoming more apparent. In Europe, the ECB and IMF have begun to use the financial crisis to wrest control of the budgets of deficits-plagued nations to apply business-friendly austerity measures. The economic meltdown--that was generated by overleveraged banks trading dodgy investment paper--is now being used to assert corporate/bank control over sovereign nations. Greece, Ireland, Iceland, Ukraine, Latvia, Lithuania, Portugal and Spain are all presently in the crosshairs of neoliberal restructuring. Surely, the same policies will be applied within the United States under the guidance of supply-side economist and chief advisor to the president, Lawrence Summers. Thus, in 2010, economic contraction will continue to force state and local governmnets to lay off millions of more workers while public assets and services are made available at firesale prices to private industry.
Debt deflation and deleveraging will continue into 2011, while foreclosures, personal bankruptcies and defaults continue to mount. The public's frustration with ineffective government policies, is likely to change from pessimism to rage on short notice. The prospect of social unrest or sporadic incidents of violence can no longer be excluded.
Saturday, December 5, 2009
President Obama's Secret: Only 100 al Qaeda Now in Afghanistan
With New Surge, One Thousand U.S. Soldiers and $300 Million for Every One al Qaeda Fighter
By RICHARD ESPOSITO, MATTHEW COLE and BRIAN ROSS
December 03, 2009 "ABC News" - Dec. 2, 2009 — As he justified sending 30,000 more troops to Afghanistan at a cost of $30 billion a year, President Barack Obama's description Tuesday of the al Qaeda "cancer" in that country left out one key fact: U.S. intelligence officials have concluded there are only about 100 al Qaeda fighters in the entire country.
A senior U.S. intelligence official told ABCNews.com the approximate estimate of 100 al Qaeda members left in Afghanistan reflects the conclusion of American intelligence agencies and the Defense Department. The relatively small number was part of the intelligence passed on to the White House as President Obama conducted his deliberations.
President Obama made only a vague reference to the size of the al Qaeda presence in his speech at West Point, when he said, "al Qaeda has not reemerged in Afghanistan in the same number as before 9/11, but they retain their safe havens along the border."
A spokesperson at the White House's National Security Council, Chris Hensman, said he could not comment on intelligence matters.
Obama's National Security Adviser, Gen. James Jones, put the number at "fewer than a hundred" in an October interview with CNN.
Sen. Jeanne Shaheen, D-N.H., referred to the number at a Senate Foreign Relations Committee in October, saying "intelligence says about a hundred al Qaeda in Afghanistan."
As the President acknowledged, al Qaeda now operates from Pakistan where U.S. troops are prohibited from operating. "We're in Afghanistan to prevent a cancer from once again spreading through that country," he said.
Intelligence officials estimate there are several hundred al Qaeda fighters just across the border in Pakistan.
An Obama administration official said the additional troops were needed in Afghanistan to "sandwich" al Qaeda between Pakistan and Afghanistan and prevent them from re-establishing a safe haven in Afghanistan.
"Pakistan has been stepping up its efforts," the official said.
"So the real question is will Pakistan do enough," said former White House counter-terrorism official Richard Clarke, an ABC News consultant.
"What if they take all the money we given them but don't really follow through? What the strategy then?" said Clarke.
With 100,000 troops in Afghanistan at an estimated yearly cost of $30 billion, it means that for every one al Qaeda fighter, the U.S. will commit 1,000 troops and $300 million a year.
al Qaeda's Ideological Influence
Other counter-terror analysts say the actual number of al Qaeda in Afghanistan is less important than their ability to train others in the Taliban and have ideological influence.
"A hundred 'no foolin' al Qaeda operatives operating in a safe haven can do a hell of a lot of damage," said one former intelligence official with significant past experience in the region.
At a Senate hearing, the former CIA Pakistan station chief, Bob Grenier, testified al Qaeda had already been defeated in Afghanistan.
"So in terms of 'in Afghanistan,'" asked Sen. John Kerry, D-Mass., "they have been disrupted and dismantled and defeated. They're not in Afghanistan, correct?"
"That's true," replied Grenier.
By RICHARD ESPOSITO, MATTHEW COLE and BRIAN ROSS
December 03, 2009 "ABC News" - Dec. 2, 2009 — As he justified sending 30,000 more troops to Afghanistan at a cost of $30 billion a year, President Barack Obama's description Tuesday of the al Qaeda "cancer" in that country left out one key fact: U.S. intelligence officials have concluded there are only about 100 al Qaeda fighters in the entire country.
A senior U.S. intelligence official told ABCNews.com the approximate estimate of 100 al Qaeda members left in Afghanistan reflects the conclusion of American intelligence agencies and the Defense Department. The relatively small number was part of the intelligence passed on to the White House as President Obama conducted his deliberations.
President Obama made only a vague reference to the size of the al Qaeda presence in his speech at West Point, when he said, "al Qaeda has not reemerged in Afghanistan in the same number as before 9/11, but they retain their safe havens along the border."
A spokesperson at the White House's National Security Council, Chris Hensman, said he could not comment on intelligence matters.
Obama's National Security Adviser, Gen. James Jones, put the number at "fewer than a hundred" in an October interview with CNN.
Sen. Jeanne Shaheen, D-N.H., referred to the number at a Senate Foreign Relations Committee in October, saying "intelligence says about a hundred al Qaeda in Afghanistan."
As the President acknowledged, al Qaeda now operates from Pakistan where U.S. troops are prohibited from operating. "We're in Afghanistan to prevent a cancer from once again spreading through that country," he said.
Intelligence officials estimate there are several hundred al Qaeda fighters just across the border in Pakistan.
An Obama administration official said the additional troops were needed in Afghanistan to "sandwich" al Qaeda between Pakistan and Afghanistan and prevent them from re-establishing a safe haven in Afghanistan.
"Pakistan has been stepping up its efforts," the official said.
"So the real question is will Pakistan do enough," said former White House counter-terrorism official Richard Clarke, an ABC News consultant.
"What if they take all the money we given them but don't really follow through? What the strategy then?" said Clarke.
With 100,000 troops in Afghanistan at an estimated yearly cost of $30 billion, it means that for every one al Qaeda fighter, the U.S. will commit 1,000 troops and $300 million a year.
al Qaeda's Ideological Influence
Other counter-terror analysts say the actual number of al Qaeda in Afghanistan is less important than their ability to train others in the Taliban and have ideological influence.
"A hundred 'no foolin' al Qaeda operatives operating in a safe haven can do a hell of a lot of damage," said one former intelligence official with significant past experience in the region.
At a Senate hearing, the former CIA Pakistan station chief, Bob Grenier, testified al Qaeda had already been defeated in Afghanistan.
"So in terms of 'in Afghanistan,'" asked Sen. John Kerry, D-Mass., "they have been disrupted and dismantled and defeated. They're not in Afghanistan, correct?"
"That's true," replied Grenier.
Friday, December 4, 2009
The U.S. Government Is Taking Us Down
By Jacob G. Hornberger
December 01, 2009 "fff" --- President Obama has decided to up the ante in Afghanistan by acceding to his generals’ request to send an additional 34,000 troops to that beleaguered nation. What better proof that those of us who opposed the initial invasion of Afghanistan were right? The decision to treat the 9/11 attacks as a military problem, rather than a criminal-justice one, has turned out to be one unmitigated disaster, a disaster that seemingly has no end.
After all, the occupation has now been going on for 8 years. Eight years of bombs, shootings, killing, maiming, secret prisons, arbitrary arrests, torture, indefinite incarcerations, and unrestrained power to search and seize.
And eight years of unrestrained spending on armaments, soldiers, and weaponry.
Where has it gotten the American people? Nothing but more anger and rage against them among Muslims all over the world, not to mention an ever-increasing mountain of debt that is sure to send America’s currency into a free-fall.
What will those additional troops do? They will kill and maim and incarcerate and torture people. That’s their job. Sure, they’ll call it pacifying the country, establishing law and order, spreading democracy, and waging the war on terrorism.
Yet, as they kill, maim, torture, and incarcerate more Afghanis, at the same time they will be producing more anger and rage against the United States among friends, relatives, and countrymen of the victims.
Moreover, since the victims in Afghanistan are predominantly Muslim, it is inevitable that Muslims all over the world will continue to perceive the U.S. occupation of Afghanistan (and Iraq) as a U.S. crusade against Islam. Denials by U.S. officials will continue to fall upon deaf ears within the Muslim community. With each new death at the hands of U.S. military personnel, the ranks of the terrorists will continue to swell, not just in Afghanistan but all over the world.
What began as an attempt to capture or kill Osama bin Laden has morphed into an involvement in a civil war. Those 34,000 troops aren’t being sent to Afghanistan to find bin Laden. They’re being sent there to kill people whose regime was ousted from power eight years ago and to maintain a crooked, corrupt, fraudulent, drug-pushing U.S. puppet regime in power.
We should also bear in mind that among the Afghanis who U.S. officials term “bad guys” are those Afghanis who simply are resisting the illegal occupation of their country by a foreign invader and occupier. There is a moral and just alternative to killing such people: Simply exit the country.
In fact, it would be interesting to know what percentage of Afghanis killed by the U.S. military during the past 8 years, including those wedding parties that are bombed from time to time, had anything to do with the 9/11 attacks. My hunch: 99.99 percent of the total number of Afghanis killed had absolutely nothing to do with the 9/11 attacks. Of course, we don’t know how many Afghanis have been killed because U.S. policy is to keep track only of Western casualties.
On top of all this is a simple financial fact: the longer the U.S. government occupies Afghanistan (and Iraq), the closer to national bankruptcy America comes. The additional troops are estimated to cost more than $30 billion dollars. That inevitably means double or triple that.
Yet, where is all that money coming from? We all know that ever since 9/11, U.S. officials have been spending much more than what the IRS is seizing from the taxpayers. To avoid taxpayer ire, they’ve been borrowing the difference, especially from the communist regime in China, which has become the U.S. government’s chief foreign lender.
The pro-empire, pro-intervention crowd is taking our country down. Today, they tell us that they’re trapped — that they have no choice — that in order to achieve “success,” they have to continue doing the same thing they’ve done for the past 8 years. If that’s not insane, what is?
America need not fear the terrorists or even a foreign invasion. The U.S. government is doing a fine job taking down our country all on its own.
December 01, 2009 "fff" --- President Obama has decided to up the ante in Afghanistan by acceding to his generals’ request to send an additional 34,000 troops to that beleaguered nation. What better proof that those of us who opposed the initial invasion of Afghanistan were right? The decision to treat the 9/11 attacks as a military problem, rather than a criminal-justice one, has turned out to be one unmitigated disaster, a disaster that seemingly has no end.
After all, the occupation has now been going on for 8 years. Eight years of bombs, shootings, killing, maiming, secret prisons, arbitrary arrests, torture, indefinite incarcerations, and unrestrained power to search and seize.
And eight years of unrestrained spending on armaments, soldiers, and weaponry.
Where has it gotten the American people? Nothing but more anger and rage against them among Muslims all over the world, not to mention an ever-increasing mountain of debt that is sure to send America’s currency into a free-fall.
What will those additional troops do? They will kill and maim and incarcerate and torture people. That’s their job. Sure, they’ll call it pacifying the country, establishing law and order, spreading democracy, and waging the war on terrorism.
Yet, as they kill, maim, torture, and incarcerate more Afghanis, at the same time they will be producing more anger and rage against the United States among friends, relatives, and countrymen of the victims.
Moreover, since the victims in Afghanistan are predominantly Muslim, it is inevitable that Muslims all over the world will continue to perceive the U.S. occupation of Afghanistan (and Iraq) as a U.S. crusade against Islam. Denials by U.S. officials will continue to fall upon deaf ears within the Muslim community. With each new death at the hands of U.S. military personnel, the ranks of the terrorists will continue to swell, not just in Afghanistan but all over the world.
What began as an attempt to capture or kill Osama bin Laden has morphed into an involvement in a civil war. Those 34,000 troops aren’t being sent to Afghanistan to find bin Laden. They’re being sent there to kill people whose regime was ousted from power eight years ago and to maintain a crooked, corrupt, fraudulent, drug-pushing U.S. puppet regime in power.
We should also bear in mind that among the Afghanis who U.S. officials term “bad guys” are those Afghanis who simply are resisting the illegal occupation of their country by a foreign invader and occupier. There is a moral and just alternative to killing such people: Simply exit the country.
In fact, it would be interesting to know what percentage of Afghanis killed by the U.S. military during the past 8 years, including those wedding parties that are bombed from time to time, had anything to do with the 9/11 attacks. My hunch: 99.99 percent of the total number of Afghanis killed had absolutely nothing to do with the 9/11 attacks. Of course, we don’t know how many Afghanis have been killed because U.S. policy is to keep track only of Western casualties.
On top of all this is a simple financial fact: the longer the U.S. government occupies Afghanistan (and Iraq), the closer to national bankruptcy America comes. The additional troops are estimated to cost more than $30 billion dollars. That inevitably means double or triple that.
Yet, where is all that money coming from? We all know that ever since 9/11, U.S. officials have been spending much more than what the IRS is seizing from the taxpayers. To avoid taxpayer ire, they’ve been borrowing the difference, especially from the communist regime in China, which has become the U.S. government’s chief foreign lender.
The pro-empire, pro-intervention crowd is taking our country down. Today, they tell us that they’re trapped — that they have no choice — that in order to achieve “success,” they have to continue doing the same thing they’ve done for the past 8 years. If that’s not insane, what is?
America need not fear the terrorists or even a foreign invasion. The U.S. government is doing a fine job taking down our country all on its own.
How Free-Market Delusions Destroyed the Economy
By Raj Patel
December 01, 2009 "Information Clearing House" -- If war is God’s way of teaching Americans geography, recession is His way of teaching everyone a little economics. The great unwinding of the financial sector showed that the smartest mathematical minds on the planet, backed by some of the deepest pockets, had not built a sleek engine of permanent prosperity but a clown car of trades, swaps and double dares that, inevitably, fell to bits. The recession has not come from a deficit of economic knowledge, but from too much of a particular kind, a surfeit of the spirit of capitalism. The dazzle of free markets has blinded us to other ways of seeing the world. As Oscar Wilde wrote over a century ago: "Nowadays people know the price of everything and the value of nothing." Prices have revealed themselves as fickle guides: The 2008 financial collapse came in the same year as crises in food and oil, and yet we seem unable to see or value our world except through the faulty prism of markets.
One thing is clear: The thinking that got us into this mess is unlikely to rescue us. It might come as some consolation to know that even some of the most respected minds have been forced to puzzle over their faulty assumptions. Perhaps the most pained admission of ignorance happened in a crowded room in front of the House Committee on Oversight and Government Reform when, on October 23, 2008, Alan Greenspan described the failure of his worldview.
Greenspan was one of the acknowledged legislators of the world’s economy over the past nineteen years in his role as chairman of the Federal Reserve. A card-carrying member of the free market brigade, he used to sit at the feet of Ayn Rand who, although largely unknown outside the United States, remains influential long after her death in 1982. Her 1957 book Atlas Shrugged, in which heroic business moguls fight the scourge of government officials and union organizers, has once again scaled the bestseller lists. Regarding altruism as “moral cannibalism," Rand was the cheerleader for an extreme free market libertarian school of thought, which she called “Objectivism."
Drawn into her circle by this heady philosophy, Greenspan earned himself the nickname “the Undertaker" for his jolly demeanor and dress sense. When Greenspan chose a career in government, it was rather like a hippie joining the marines, a lapse that his former friends could never forgive. Despite this, Greenspan remained largely faithful to Rand's philosophy, continuing to believe that egoism would lead to the best of all possible worlds, and that any form of restraint would result in disaster.
At the end of 2008, Greenspan was summoned to the U.S. Congress to testify about the financial crisis. His tenure at the Fed had been long and lauded, and Congress wanted to know what had gone wrong. As he began to read his testimony, Greenspan looked exhausted, his skin jowly and sagging, as if the vigor that once kept him taut had all been spent. But he came out swinging. In the first round, he took aim at the information he’d been working with. If only the input had been right, the economic models would have worked, and the predictions would have been better. In his words, a Nobel Prize was awarded for the discovery of the pricing model that underpins much of the advance in derivatives markets. This modern risk management paradigm held sway for decades. The whole intellectual edifice, however, collapsed in the summer of last year because the data inputted into the risk management models generally covered only the past two decades, a period of euphoria.
Had instead the models been fitted more appropriately to historic periods of stress, capital requirements would have been much higher and the financial world would be in far better shape today, in my judgment.
This is a garbage-in-garbage-out argument: The model worked just fine, but the assumptions about risk and data, based only on the good times past, were faulty and so the output was correspondingly wrong. Greenspan’s nemesis on the panel, Henry Waxman, pushed him to a deeper conclusion, in this remarkable exchange:
Waxman: The question I have for you is, you had an ideology, you had a belief that free, competitive -- and this is your statement -- “I do have an ideology. My judgment is that free, competitive markets are by far the unrivalled way to organize economies. We have tried regulation, none meaningfully worked.” That was your quote. You had the authority to prevent irresponsible lending practices that led to the subprime mortgage crisis. You were advised to do so by many others. And now our whole economy is paying the price. Do you feel that your ideology pushed you to make decisions that you wish you had not made?
Greenspan: Well, remember, though, what an ideology is. It’s a conceptual framework with [sic] the way people deal with reality. Everyone has one. You have to. To exist, you need an ideology. The question is, whether it is accurate or not. What I am saying to you is, yes, I found the flaw, I don’t know how significant or permanent it is, but I have been very distressed by that fact.
Waxman: You found a flaw?
Greenspan: I found a flaw in the model that I perceived is the critical functioning structure that defines how the world works, so to speak.
Waxman: In other words, you found that your view of the world, your ideology, was not right, it was not working.
Greenspan: Precisely. That is precisely the reason I was shocked, because I had been going for 40 years or more with very considerable evidence that it was working exceptionally well.
The flaw, to be clear, wasn’t a minor one of shoddy data. Nor was it the bigger Black Swan problem that writers like Nassim Taleb discuss, a problem of failing to account for highly unlikely events that, should they happen, involve catastrophic consequences. Greenspan’s flaw was more fundamental still. It warped his view about how the world was organized, about the sociology of the market. And Greenspan is not alone. Larry Summers, the president’s senior economic advisor, has had to come to terms with a similar error -- his view that the market was inherently self-stabilizing has been "dealt a fatal blow." Hank Paulson, Bush’s Treasury Secretary, has shrugged his shoulders with similar resignation. Even Jim Cramer from CNBC’s "Mad Money" admitted defeat: "The only guy who really called this right was Karl Marx." One after the other, the celebrants of the free market are finding themselves, to use the language of the market, corrected.
The extent of Greenspan's admission has passed most of us by. If you trawl the oped pages of the financial press, you'll find plenty of analysis that fits Greenspan's first gambit, with pundits offering stories about how risk was incorrectly priced (which it was), how the lack of regulation allowed the panic to feed back into the financial system (which it has), how the incentive structures rewarded traders who were able to push financial risk far into the future (which they did) and how free market ideologues removed the sorts of circuit-breaking policies that might today have helped (and they did that too). But these are all it-could-have-been-fixed-if-we'd-planned-better responses. I am not sure that we're able to comprehend what Greenspan's admission might really mean for us. It would be too big a shock to have the fundamentals of policy in both government and the economy proved wrong, and to have nothing with which to replace them.
It's as if one day, you were to wake up and find yourself transformed into a cockroach. This is the premise of Franz Kafka's novella Metamorphosis. In the first sentence, a young salesman named Gregor Samsa wakes up, after a night of bad dreams, to find that he has turned into an enormous bug. Gregor Samsa's response is revealing, telling us a little bit more about ourselves than we'd like. For what does Samsa do when he discovers he's a bug? He doesn't scuttle from his room screaming, or ponder how this happened, or what his transformation means, and what he might become tomorrow. His response is essentially this: "Poor me! How am I going to keep my job?" Which is almost exactly how we've reacted to this economic crisis. While no one has yet woken up in the body of a bug, we have all found ourselves in a world turned upside down, where everything we were told was to our advantage has turned out to be its opposite. Greenspan's "flaw" has profound repercussions -- to understand it fully would mean a complete reappraisal of the way we conduct our lives. We would need not only a new way of mooring our expectations of our society and our economy, one based on richer assumptions about human nature, but also a different ideology governing the exchange of goods and services.
Prices do some heavy ideological lifting in Greenspan's world. They provide a way to see and know the collective wants and resources of our small planet. This is Friedrich Hayek's economic philosophy, in which prices are the tendrils through which wants and needs are communicated. Science fiction fans will already be familiar with what this looks like. In "The Matrix," liberated humans (and the programs who hunt them) can see the world in its raw form, as a digital rain of symbols and signs. This is the science fiction that governs economic fact. Data pelting down monitors is what the masters of the universe on the global financial exchanges stare at, their eyes darting from screen to screen, trying to see through the world and profit from it. In "The Matrix," the signs were a simulation of the real world, hiding more than they revealed. The trouble is that this unreliable digital ticker tape has now become a central prop in the drama of modern commerce.
Consider the fate of Volkswagen, which at the end of October 2008 managed briefly to become the world's most valuable corporation without having to sell a single vehicle. With the economy still in free fall, traders on stock market floors were taking a dim view of Volkswagen. They looked at their screens and concluded that, just like every other auto manufacturer, Volkswagen was heading for tough times. Imagine you're a trader who feels in your bones that the stock price can only fall. One way to cash your hunch in is to sell Volkswagen stock today, and buy it back when the price falls. Since you don't walk around with Volkswagen stock falling out of your pockets, you'll turn to someone who does, like an institutional investor. You borrow their stock, for a price, and promise to return all of it very soon. The institutional investor is happy because they make money from lending out the stock, which they will get back in one piece. You're happy because you can sell this stock, wait for the price to fall, buy it back and, with the profit, not only pay back the institutional investor, but make the next installment on your yacht in Monaco. This practice is called "shorting."
The trouble was that Volkswagen's rival, Porsche, had started quietly buying Volkswagen stock, aiming to secure 75 percent of the company. When the scale of Porsche's buying spree came to light, it became rapidly clear that there was little of the company left to trade. With Porsche sucking up all the shares, the price for Volkswagen didn't drop. Traders were selling borrowed stock to Porsche, and when Porsche announced its intentions to hold the stock, traders panicked. This led to a "short squeeze," a flocking of investors looking to cover the ill-conceived bets that they'd paid for with stock that they didn't own. They'd wagered that Volkswagen's price, like that of any other car company in a recession, would fall. When it became clear that even if Volkswagen wasn't doing well in the car market, its share price was nonetheless defying gravity, the speculators rushed to buy before the price went any higher.
Their combined purchases drove the price of shares up further. So high did the price rise that Volkswagen entered the DAX 30 index of the largest corporations on the German bourse. This triggered another buying spree, driven not by stock market gamblers, but by their polar opposites -- conservative institutional investors. Pension funds, for instance, invest with an eye to long-term returns; they prefer a slow and certain accumulation of wealth rather than risky bets. One way that they keep their portfolio on an even keel is to buy shares in nothing but blue chip corporations, ones that are guaranteed to be least susceptible to the shocks that stocks are heir to, ones that are in the top, say, thirty corporations traded in the open market. When Volkswagen joined the ranks of the DAX 30, a flock of institutional investors automatically wanted in. So they bought Volkswagen shares at what ever price they could find them. The result? The price per share went from 200 to 1,000 in a week--an increase in company value of 300 billion (244 billion; $386 billion). It made Volkswagen, briefly, bigger than ExxonMobil (with a book value of a mere $343 billion). And for this, the company didn't raise a finger.
In the end, the rules on the DAX were changed, the price settled down and, in 2009, Volkswagen bought Porsche. It is easy enough to tell this story as one where institutional investors got caught with their pants down, where there was imperfect information about the size of the market, where the rules of different short-run and long-run games tangled. But look more closely. Underwriting this version of the story is a conceptual structure that lies beneath every story of excess and crash. The very notion of a bubble relies on the premise that when the bubble pops, things return to a normal state, a situation of price reflecting value more accurately. This is the story told after every boom and bust, from the South Sea Bubble of 1720 to the housing catastrophe of 2008. There's a widely shared opinion that normality will ultimately return to the world economy--but it's a consensus view that rests on a story where bubbles are exceptions to the standard (and successful) procedures of market valuation. If those procedures themselves were flawed, as Greenspan suggests, then our faith in a gentle return to earth is misplaced, for there is and never has been any solid ground beneath our feet.
There is a discrepancy between the price of something and its value, one that economists cannot fix, because it's a problem inherent to the very idea of profit-driven prices. This gap is something about which we've got an uneasy and uncomfortable intuition. The uncertainty about prices is what makes the MasterCard ads amusing. You know how it goes -- green fees: $240; lessons: $50; golf club: $110; having fun: priceless. The deeper joke, though, is this: The price of something doesn't measure its value at all. This prickly intuition has become entertainment. An alien from another planet would find it strange that one of the most popular TV shows in dozens of countries is one that trades on the confusion around what something's worth: "The Price Is Right." In the show, the audience is presented with various consumer durables, and asked to guess the retail price of each. Crucially, you don't win by correctly guessing how useful something is or how much it costs to make -- prices are poor guides to use and true costs of production. You win by developing an intuitive sense of what corporations believe you're willing to pay.
In the world of fund management, the systematic confusion surrounding what something is worth has made some people very rich. Traders' salaries are linked to the returns above expected rates for the risk they take on, the so-called alpha that they contribute to the returns. Think of a bet on a coin flip, with odds of two to one. I bet $1 that I will hit heads, and every time I do, I get $2. In the long run, I'd expect a dollar bet with those odds to return a dollar because I'll come up heads about half the time. But if I'm returning $1.50 on the bet, I'm making magic happen. This magic gets turned back into coins that I get to keep, through bonuses and increased salary. This is a tough trick to pull off because there are only a handful of ways to create added value in fund management -- I can pick undervalued stocks that outperform expectations, I can nurture innovations that change the rules of the game, or I can create new bespoke assets that institutional investors might like.
So we would expect alpha to be rare, and it is, but driven by the desire to cash in, there were many who created fake alpha through bets that appeared to produce consistently good returns despite having a small built-in chance of catastrophic loss. If the expected value of this loss were factored in, the alpha would disappear. But the risks were ignored and bonuses flowed. The frat boys who ran the economy, and profited from its poor regulation, made billions. They were paid today for outcomes that they predicted would happen in the future, using a "mark to model" accounting practice that essentially allowed them to book today what they projected they'd earn tomorrow. This practice was justified on the grounds that "markets know best."
That markets should know best is a relatively recent article of faith, and it took a great deal of ideological and political work to make it part of governments' conventional wisdom. The idea that markets are smart found its apotheosis in the Efficient Markets Hypothesis, an idea first formulated by Eugene Fama, a Ph.D. student in the University of Chicago Business School in the 1960s. In the ideological foundations it provided for financiers, it was a mighty force -- think of it as Atlas Shrugged, but with more equations.
The hypothesis states that the price of a financial asset reflects everything that a market knows about its current and future prospects. This is different from saying that the price actually does reflect its future performance -- rather, the price reflects the current state of beliefs about the odds of that performance being good or bad. The price involves a bet. As we now know, the market's eye for odds is dangerously myopic, but the hypothesis explains why economists find the following joke funny:
Q: How many Chicago School economists does it take to change a lightbulb?
A: None. If the lightbulb needed changing, the market would have already done it.
The problem with the Efficient Markets Hypothesis is that it doesn't work. If it were true, then there'd be no incentive to invest in research because the market would, by magic, have beaten you to it. Economists Sanford Grossman and Joseph Stiglitz demonstrated this in 1980, and hundreds of subsequent studies have pointed out quite how unrealistic the hypothesis is, some of the most influential of which were written by Eugene Fama himself. Markets can behave irrationally -- investors can herd behind a stock, pushing its value up in ways entirely unrelated to the stock being traded. Despite ample economic evidence to suggest it was false, the idea of efficient markets ran riot through governments. Alan Greenspan was not the only person to find the hypothesis a convenient untruth.
By pushing regulators to behave as if the hypothesis were true, traders could make their titanic bets. For a while, the money rolled in. In the mid-1990s, the Financial Times felt able to launch a monthly supplement, titled "How to Spend It," to help its more affluent readers unburden themselves. The magic of the past decade's boom also touched the middle class, who were sucked into the bubble through houses that were turned from places of shelter into financial assets, and into grist for the mill of the financial sector. But ordinary homeowners couldn't muster the clout that banks could: Governments enabled the finance sector's binge by promising to be there to pick up the pieces, and they were as good as their word. When the financiers' bets broke the system, the profit that they made from these bad bets remained untouchable: The profit was privatized, but the risk was socialized. Their riches have cost the whole world dear, and yet in 2009 the top hedge fund managers have had their third best year on record. George Soros is, in his own words, "having a very good crisis," and staff at Goldman Sachs can look forward to the largest bonus payouts in the firm's 140-year history.
What this suggests is that the rhetoric of "free markets" camouflages activities that aren't about markets at all. Goldman Sachs employees are doing well because their firm turned some distinctly nonmarket tricks. Rolling Stone journalist Matt Taibbi has recently revealed, with characteristic verve, how Goldman Sachs has bought the U.S. government. In the Obama administration's economic team, Wall Street has a generation of finance-friendly appointees, from Treasury Secretary Tim Geithner, who arranged a historic $29 billion loan to persuade JPMorgan Chase to acquire Bear Stearns during his tenure as chair of the Federal Reserve Bank of New York; to Larry Summers, who earned $5.2 million by working one day a week for a couple of years in a large Wall Street hedge fund. Their new positions in the White House make them the Tarzans of the economic jungle. Wall Street has reason to be pleased. Goldman had invested heavily in AIG, the insurance giant whose financial products division had brought the 90-year-old giant to bankruptcy. With the 2008 AIG rescue, the $13 billion that Goldman invested was repaid at full face value. Investors in Chrysler, by contrast, stand to get 29 cents for every dollar they invested.
Anyone concerned with democracy should be worried that the seam between Wall Street and the government is almost invisible. At the very least, it raises serious reasons to doubt that the institutions that facilitated the crisis can clean up their mess. Nassim Taleb points to the absurdity here: "People who were driving a school bus (blindfolded) and crashed it should never be given a new bus." The problem is that because both our economy and to a larger extent our politicians aren't really subject to democratic control, the bus drivers are always going to be graduates of the same driving school.
Despite the ongoing hijack of government by Wall Street, a word that hasn't been heard in over a generation is being uttered by politicians: "regulation." It's true that Goldman Sachs and others are profiting handsomely from the collapse, but there is nonetheless a growing sense among politicians that the market may have been allowed too free a rein. Naomi Klein's devastating critique The Shock Doctrine demonstrates how disasters were turned into platforms for rabidly free market policies, and it's an analysis that explains the post-World War II era and today's ongoing financial plunder, from California to Wall Street to the City of London, very well. But there is a recognition among the public and some politicians that today's economic crisis is a failure of free market thinking, and not a warrant for more. In response to popular outcry, politicians around the world seem ready to discuss how to regulate and restrain the market. The question is, can they, and, if they can, in whose interests will this regulation work?
From its inception, the free market has spawned discontent, but rare are the moments when that discontent coalesces across society, when a sufficiently large group of people can trace their unhappiness to free market politics, and demand change. The New Deal in the United States and the postwar European welfare states were partly a result of a consortium of social forces pushing for new limits to markets, and a renegotiation of the relationship between individuals and society. What's new about this crisis is that it's pervasively global, and comes at the last moment at which we might prevent a global climate catastrophe.
December 01, 2009 "Information Clearing House" -- If war is God’s way of teaching Americans geography, recession is His way of teaching everyone a little economics. The great unwinding of the financial sector showed that the smartest mathematical minds on the planet, backed by some of the deepest pockets, had not built a sleek engine of permanent prosperity but a clown car of trades, swaps and double dares that, inevitably, fell to bits. The recession has not come from a deficit of economic knowledge, but from too much of a particular kind, a surfeit of the spirit of capitalism. The dazzle of free markets has blinded us to other ways of seeing the world. As Oscar Wilde wrote over a century ago: "Nowadays people know the price of everything and the value of nothing." Prices have revealed themselves as fickle guides: The 2008 financial collapse came in the same year as crises in food and oil, and yet we seem unable to see or value our world except through the faulty prism of markets.
One thing is clear: The thinking that got us into this mess is unlikely to rescue us. It might come as some consolation to know that even some of the most respected minds have been forced to puzzle over their faulty assumptions. Perhaps the most pained admission of ignorance happened in a crowded room in front of the House Committee on Oversight and Government Reform when, on October 23, 2008, Alan Greenspan described the failure of his worldview.
Greenspan was one of the acknowledged legislators of the world’s economy over the past nineteen years in his role as chairman of the Federal Reserve. A card-carrying member of the free market brigade, he used to sit at the feet of Ayn Rand who, although largely unknown outside the United States, remains influential long after her death in 1982. Her 1957 book Atlas Shrugged, in which heroic business moguls fight the scourge of government officials and union organizers, has once again scaled the bestseller lists. Regarding altruism as “moral cannibalism," Rand was the cheerleader for an extreme free market libertarian school of thought, which she called “Objectivism."
Drawn into her circle by this heady philosophy, Greenspan earned himself the nickname “the Undertaker" for his jolly demeanor and dress sense. When Greenspan chose a career in government, it was rather like a hippie joining the marines, a lapse that his former friends could never forgive. Despite this, Greenspan remained largely faithful to Rand's philosophy, continuing to believe that egoism would lead to the best of all possible worlds, and that any form of restraint would result in disaster.
At the end of 2008, Greenspan was summoned to the U.S. Congress to testify about the financial crisis. His tenure at the Fed had been long and lauded, and Congress wanted to know what had gone wrong. As he began to read his testimony, Greenspan looked exhausted, his skin jowly and sagging, as if the vigor that once kept him taut had all been spent. But he came out swinging. In the first round, he took aim at the information he’d been working with. If only the input had been right, the economic models would have worked, and the predictions would have been better. In his words, a Nobel Prize was awarded for the discovery of the pricing model that underpins much of the advance in derivatives markets. This modern risk management paradigm held sway for decades. The whole intellectual edifice, however, collapsed in the summer of last year because the data inputted into the risk management models generally covered only the past two decades, a period of euphoria.
Had instead the models been fitted more appropriately to historic periods of stress, capital requirements would have been much higher and the financial world would be in far better shape today, in my judgment.
This is a garbage-in-garbage-out argument: The model worked just fine, but the assumptions about risk and data, based only on the good times past, were faulty and so the output was correspondingly wrong. Greenspan’s nemesis on the panel, Henry Waxman, pushed him to a deeper conclusion, in this remarkable exchange:
Waxman: The question I have for you is, you had an ideology, you had a belief that free, competitive -- and this is your statement -- “I do have an ideology. My judgment is that free, competitive markets are by far the unrivalled way to organize economies. We have tried regulation, none meaningfully worked.” That was your quote. You had the authority to prevent irresponsible lending practices that led to the subprime mortgage crisis. You were advised to do so by many others. And now our whole economy is paying the price. Do you feel that your ideology pushed you to make decisions that you wish you had not made?
Greenspan: Well, remember, though, what an ideology is. It’s a conceptual framework with [sic] the way people deal with reality. Everyone has one. You have to. To exist, you need an ideology. The question is, whether it is accurate or not. What I am saying to you is, yes, I found the flaw, I don’t know how significant or permanent it is, but I have been very distressed by that fact.
Waxman: You found a flaw?
Greenspan: I found a flaw in the model that I perceived is the critical functioning structure that defines how the world works, so to speak.
Waxman: In other words, you found that your view of the world, your ideology, was not right, it was not working.
Greenspan: Precisely. That is precisely the reason I was shocked, because I had been going for 40 years or more with very considerable evidence that it was working exceptionally well.
The flaw, to be clear, wasn’t a minor one of shoddy data. Nor was it the bigger Black Swan problem that writers like Nassim Taleb discuss, a problem of failing to account for highly unlikely events that, should they happen, involve catastrophic consequences. Greenspan’s flaw was more fundamental still. It warped his view about how the world was organized, about the sociology of the market. And Greenspan is not alone. Larry Summers, the president’s senior economic advisor, has had to come to terms with a similar error -- his view that the market was inherently self-stabilizing has been "dealt a fatal blow." Hank Paulson, Bush’s Treasury Secretary, has shrugged his shoulders with similar resignation. Even Jim Cramer from CNBC’s "Mad Money" admitted defeat: "The only guy who really called this right was Karl Marx." One after the other, the celebrants of the free market are finding themselves, to use the language of the market, corrected.
The extent of Greenspan's admission has passed most of us by. If you trawl the oped pages of the financial press, you'll find plenty of analysis that fits Greenspan's first gambit, with pundits offering stories about how risk was incorrectly priced (which it was), how the lack of regulation allowed the panic to feed back into the financial system (which it has), how the incentive structures rewarded traders who were able to push financial risk far into the future (which they did) and how free market ideologues removed the sorts of circuit-breaking policies that might today have helped (and they did that too). But these are all it-could-have-been-fixed-if-we'd-planned-better responses. I am not sure that we're able to comprehend what Greenspan's admission might really mean for us. It would be too big a shock to have the fundamentals of policy in both government and the economy proved wrong, and to have nothing with which to replace them.
It's as if one day, you were to wake up and find yourself transformed into a cockroach. This is the premise of Franz Kafka's novella Metamorphosis. In the first sentence, a young salesman named Gregor Samsa wakes up, after a night of bad dreams, to find that he has turned into an enormous bug. Gregor Samsa's response is revealing, telling us a little bit more about ourselves than we'd like. For what does Samsa do when he discovers he's a bug? He doesn't scuttle from his room screaming, or ponder how this happened, or what his transformation means, and what he might become tomorrow. His response is essentially this: "Poor me! How am I going to keep my job?" Which is almost exactly how we've reacted to this economic crisis. While no one has yet woken up in the body of a bug, we have all found ourselves in a world turned upside down, where everything we were told was to our advantage has turned out to be its opposite. Greenspan's "flaw" has profound repercussions -- to understand it fully would mean a complete reappraisal of the way we conduct our lives. We would need not only a new way of mooring our expectations of our society and our economy, one based on richer assumptions about human nature, but also a different ideology governing the exchange of goods and services.
Prices do some heavy ideological lifting in Greenspan's world. They provide a way to see and know the collective wants and resources of our small planet. This is Friedrich Hayek's economic philosophy, in which prices are the tendrils through which wants and needs are communicated. Science fiction fans will already be familiar with what this looks like. In "The Matrix," liberated humans (and the programs who hunt them) can see the world in its raw form, as a digital rain of symbols and signs. This is the science fiction that governs economic fact. Data pelting down monitors is what the masters of the universe on the global financial exchanges stare at, their eyes darting from screen to screen, trying to see through the world and profit from it. In "The Matrix," the signs were a simulation of the real world, hiding more than they revealed. The trouble is that this unreliable digital ticker tape has now become a central prop in the drama of modern commerce.
Consider the fate of Volkswagen, which at the end of October 2008 managed briefly to become the world's most valuable corporation without having to sell a single vehicle. With the economy still in free fall, traders on stock market floors were taking a dim view of Volkswagen. They looked at their screens and concluded that, just like every other auto manufacturer, Volkswagen was heading for tough times. Imagine you're a trader who feels in your bones that the stock price can only fall. One way to cash your hunch in is to sell Volkswagen stock today, and buy it back when the price falls. Since you don't walk around with Volkswagen stock falling out of your pockets, you'll turn to someone who does, like an institutional investor. You borrow their stock, for a price, and promise to return all of it very soon. The institutional investor is happy because they make money from lending out the stock, which they will get back in one piece. You're happy because you can sell this stock, wait for the price to fall, buy it back and, with the profit, not only pay back the institutional investor, but make the next installment on your yacht in Monaco. This practice is called "shorting."
The trouble was that Volkswagen's rival, Porsche, had started quietly buying Volkswagen stock, aiming to secure 75 percent of the company. When the scale of Porsche's buying spree came to light, it became rapidly clear that there was little of the company left to trade. With Porsche sucking up all the shares, the price for Volkswagen didn't drop. Traders were selling borrowed stock to Porsche, and when Porsche announced its intentions to hold the stock, traders panicked. This led to a "short squeeze," a flocking of investors looking to cover the ill-conceived bets that they'd paid for with stock that they didn't own. They'd wagered that Volkswagen's price, like that of any other car company in a recession, would fall. When it became clear that even if Volkswagen wasn't doing well in the car market, its share price was nonetheless defying gravity, the speculators rushed to buy before the price went any higher.
Their combined purchases drove the price of shares up further. So high did the price rise that Volkswagen entered the DAX 30 index of the largest corporations on the German bourse. This triggered another buying spree, driven not by stock market gamblers, but by their polar opposites -- conservative institutional investors. Pension funds, for instance, invest with an eye to long-term returns; they prefer a slow and certain accumulation of wealth rather than risky bets. One way that they keep their portfolio on an even keel is to buy shares in nothing but blue chip corporations, ones that are guaranteed to be least susceptible to the shocks that stocks are heir to, ones that are in the top, say, thirty corporations traded in the open market. When Volkswagen joined the ranks of the DAX 30, a flock of institutional investors automatically wanted in. So they bought Volkswagen shares at what ever price they could find them. The result? The price per share went from 200 to 1,000 in a week--an increase in company value of 300 billion (244 billion; $386 billion). It made Volkswagen, briefly, bigger than ExxonMobil (with a book value of a mere $343 billion). And for this, the company didn't raise a finger.
In the end, the rules on the DAX were changed, the price settled down and, in 2009, Volkswagen bought Porsche. It is easy enough to tell this story as one where institutional investors got caught with their pants down, where there was imperfect information about the size of the market, where the rules of different short-run and long-run games tangled. But look more closely. Underwriting this version of the story is a conceptual structure that lies beneath every story of excess and crash. The very notion of a bubble relies on the premise that when the bubble pops, things return to a normal state, a situation of price reflecting value more accurately. This is the story told after every boom and bust, from the South Sea Bubble of 1720 to the housing catastrophe of 2008. There's a widely shared opinion that normality will ultimately return to the world economy--but it's a consensus view that rests on a story where bubbles are exceptions to the standard (and successful) procedures of market valuation. If those procedures themselves were flawed, as Greenspan suggests, then our faith in a gentle return to earth is misplaced, for there is and never has been any solid ground beneath our feet.
There is a discrepancy between the price of something and its value, one that economists cannot fix, because it's a problem inherent to the very idea of profit-driven prices. This gap is something about which we've got an uneasy and uncomfortable intuition. The uncertainty about prices is what makes the MasterCard ads amusing. You know how it goes -- green fees: $240; lessons: $50; golf club: $110; having fun: priceless. The deeper joke, though, is this: The price of something doesn't measure its value at all. This prickly intuition has become entertainment. An alien from another planet would find it strange that one of the most popular TV shows in dozens of countries is one that trades on the confusion around what something's worth: "The Price Is Right." In the show, the audience is presented with various consumer durables, and asked to guess the retail price of each. Crucially, you don't win by correctly guessing how useful something is or how much it costs to make -- prices are poor guides to use and true costs of production. You win by developing an intuitive sense of what corporations believe you're willing to pay.
In the world of fund management, the systematic confusion surrounding what something is worth has made some people very rich. Traders' salaries are linked to the returns above expected rates for the risk they take on, the so-called alpha that they contribute to the returns. Think of a bet on a coin flip, with odds of two to one. I bet $1 that I will hit heads, and every time I do, I get $2. In the long run, I'd expect a dollar bet with those odds to return a dollar because I'll come up heads about half the time. But if I'm returning $1.50 on the bet, I'm making magic happen. This magic gets turned back into coins that I get to keep, through bonuses and increased salary. This is a tough trick to pull off because there are only a handful of ways to create added value in fund management -- I can pick undervalued stocks that outperform expectations, I can nurture innovations that change the rules of the game, or I can create new bespoke assets that institutional investors might like.
So we would expect alpha to be rare, and it is, but driven by the desire to cash in, there were many who created fake alpha through bets that appeared to produce consistently good returns despite having a small built-in chance of catastrophic loss. If the expected value of this loss were factored in, the alpha would disappear. But the risks were ignored and bonuses flowed. The frat boys who ran the economy, and profited from its poor regulation, made billions. They were paid today for outcomes that they predicted would happen in the future, using a "mark to model" accounting practice that essentially allowed them to book today what they projected they'd earn tomorrow. This practice was justified on the grounds that "markets know best."
That markets should know best is a relatively recent article of faith, and it took a great deal of ideological and political work to make it part of governments' conventional wisdom. The idea that markets are smart found its apotheosis in the Efficient Markets Hypothesis, an idea first formulated by Eugene Fama, a Ph.D. student in the University of Chicago Business School in the 1960s. In the ideological foundations it provided for financiers, it was a mighty force -- think of it as Atlas Shrugged, but with more equations.
The hypothesis states that the price of a financial asset reflects everything that a market knows about its current and future prospects. This is different from saying that the price actually does reflect its future performance -- rather, the price reflects the current state of beliefs about the odds of that performance being good or bad. The price involves a bet. As we now know, the market's eye for odds is dangerously myopic, but the hypothesis explains why economists find the following joke funny:
Q: How many Chicago School economists does it take to change a lightbulb?
A: None. If the lightbulb needed changing, the market would have already done it.
The problem with the Efficient Markets Hypothesis is that it doesn't work. If it were true, then there'd be no incentive to invest in research because the market would, by magic, have beaten you to it. Economists Sanford Grossman and Joseph Stiglitz demonstrated this in 1980, and hundreds of subsequent studies have pointed out quite how unrealistic the hypothesis is, some of the most influential of which were written by Eugene Fama himself. Markets can behave irrationally -- investors can herd behind a stock, pushing its value up in ways entirely unrelated to the stock being traded. Despite ample economic evidence to suggest it was false, the idea of efficient markets ran riot through governments. Alan Greenspan was not the only person to find the hypothesis a convenient untruth.
By pushing regulators to behave as if the hypothesis were true, traders could make their titanic bets. For a while, the money rolled in. In the mid-1990s, the Financial Times felt able to launch a monthly supplement, titled "How to Spend It," to help its more affluent readers unburden themselves. The magic of the past decade's boom also touched the middle class, who were sucked into the bubble through houses that were turned from places of shelter into financial assets, and into grist for the mill of the financial sector. But ordinary homeowners couldn't muster the clout that banks could: Governments enabled the finance sector's binge by promising to be there to pick up the pieces, and they were as good as their word. When the financiers' bets broke the system, the profit that they made from these bad bets remained untouchable: The profit was privatized, but the risk was socialized. Their riches have cost the whole world dear, and yet in 2009 the top hedge fund managers have had their third best year on record. George Soros is, in his own words, "having a very good crisis," and staff at Goldman Sachs can look forward to the largest bonus payouts in the firm's 140-year history.
What this suggests is that the rhetoric of "free markets" camouflages activities that aren't about markets at all. Goldman Sachs employees are doing well because their firm turned some distinctly nonmarket tricks. Rolling Stone journalist Matt Taibbi has recently revealed, with characteristic verve, how Goldman Sachs has bought the U.S. government. In the Obama administration's economic team, Wall Street has a generation of finance-friendly appointees, from Treasury Secretary Tim Geithner, who arranged a historic $29 billion loan to persuade JPMorgan Chase to acquire Bear Stearns during his tenure as chair of the Federal Reserve Bank of New York; to Larry Summers, who earned $5.2 million by working one day a week for a couple of years in a large Wall Street hedge fund. Their new positions in the White House make them the Tarzans of the economic jungle. Wall Street has reason to be pleased. Goldman had invested heavily in AIG, the insurance giant whose financial products division had brought the 90-year-old giant to bankruptcy. With the 2008 AIG rescue, the $13 billion that Goldman invested was repaid at full face value. Investors in Chrysler, by contrast, stand to get 29 cents for every dollar they invested.
Anyone concerned with democracy should be worried that the seam between Wall Street and the government is almost invisible. At the very least, it raises serious reasons to doubt that the institutions that facilitated the crisis can clean up their mess. Nassim Taleb points to the absurdity here: "People who were driving a school bus (blindfolded) and crashed it should never be given a new bus." The problem is that because both our economy and to a larger extent our politicians aren't really subject to democratic control, the bus drivers are always going to be graduates of the same driving school.
Despite the ongoing hijack of government by Wall Street, a word that hasn't been heard in over a generation is being uttered by politicians: "regulation." It's true that Goldman Sachs and others are profiting handsomely from the collapse, but there is nonetheless a growing sense among politicians that the market may have been allowed too free a rein. Naomi Klein's devastating critique The Shock Doctrine demonstrates how disasters were turned into platforms for rabidly free market policies, and it's an analysis that explains the post-World War II era and today's ongoing financial plunder, from California to Wall Street to the City of London, very well. But there is a recognition among the public and some politicians that today's economic crisis is a failure of free market thinking, and not a warrant for more. In response to popular outcry, politicians around the world seem ready to discuss how to regulate and restrain the market. The question is, can they, and, if they can, in whose interests will this regulation work?
From its inception, the free market has spawned discontent, but rare are the moments when that discontent coalesces across society, when a sufficiently large group of people can trace their unhappiness to free market politics, and demand change. The New Deal in the United States and the postwar European welfare states were partly a result of a consortium of social forces pushing for new limits to markets, and a renegotiation of the relationship between individuals and society. What's new about this crisis is that it's pervasively global, and comes at the last moment at which we might prevent a global climate catastrophe.
Wednesday, December 2, 2009
Has The USA Forgotten Peace
By Gordon Duff
December 01, 2009 "Veterans Today" -- Tonight, I will listen to the President tell me that it will take years to withdraw from Afghanistan. He will, out of political necessity tell a series of lies. He will lie by omission, failing to tell people that this war, our "good war" was, when the facts are examined, a farce. There has not been a credible word from Osama bin Laden since December, 2001, when his death was announced in the Islamic press. What other reason did we have to occupy Afghanistan and lead it into total ruin?
The President will also lie because he has been lied to. He will present solutions, solutions sending troops into harms way, troops meant to build a government and country that force of arms can only destroy.
Years of propaganda and war mongering has made it impossible for any honest dialog about war. Years of lying, lying for politics, lying for profit, lying in support of treasonous foreign interests has left us with nothing to build on. No honest voice is left, just screaming liars paid by thieves claiming to represent the right or the left.
Neither really exist. If it talks, if it squawks, it is paid off by someone and is probably lying. Our government has their own business, getting elected, taking care of rich constituents and making sure war profiteers keep raking it in.
Without a voice of opposition from the people, as there is certainly no opposition in Washington, especially since the GOP is tied to the apron strings of the insurance industry and big oil and has no time for simple people, there will be no voice to scream "STOP."
Yes, support the troops. Bring them home to their families, let the villagers in Afghanistan continue whatever they have been doing for 300 years and stay out of it. We have managed to build a massive economy around playing at war. How many lobbyists does it require to hold a village in Afghanistan?
How many Predator drones does it require to find a bed for a homeless veteran?
How many mercenaries does it take to teach an amputee how to walk?
How many intelligence analysts does it take to figure out that if you keep doing the same thing over and over and it doesn't work, but you keep doing the same thing anyway, it is a sign you are nuts?
How long is it going to take us to realize that NOBODY is on our side. We think we are the new Roman empire, the policeman of the world. America isn't Caesar's Rome, not even the Rome of Augustus. We are the Rome of Nero and Caligula, a society steeped in corruption, excess and debauchery. How many Americans think of Washington DC as a center of culture and stability?
Does anyone even think America has a policy or government? Are we a country or simply a group of people ruled by a government owned and operated by special interest groups who dip into our treasury at will, send our kids off to war for amusement serve the agendas of "flavor of the month" allies, often brutal dictatorships disguised as enlightened democracies.
Over 40 years ago, America began to awaken to the fact that the war in Vietnam was a senseless slaughter having nothing to do with American values or security. President Obama is the 3rd president in my lifetime elected based on his promise to end a war.
In 1952, Eisenhower promised peace in Korea. We still have troops there nearly 6 decades later and wait daily for war to break out again.
In 1968, Nixon promised a "secret plan" to end the war in Vietnam. His plan, fight for 4 more years, killing 20,000 more Americans, then abandon most of our POWs and give Vietnam to the communists.
Tonite we hear another secret plan to end a war. Will we hear the truth? Not hardly!
"8 years ago we invaded Afghanistan and a short time later, Iraq, to punish a small group of murderers that killed 3000 Americans. As time has gone on, we now know that much of what we believed about those attacks is false. Evidence now points, not only to terror groups, but to countries we thought to be friends and there is even evidence of complicity here at home.
After years of phony intelligence, propaganda campaigns and torturing false confessions out of detainees, nothing can be trusted.
Donald Rumsfeld tells it best. He went before the 9/11 Commission stating there was never any indication that terror attacks of the kind seen on 9/11 were possible nor did he receive any warning. We now know that nearly every word he and so many others told that commission were lies, unquestionable, proven and done with remorseless cynicism.
8 years, the illegal invasion of Iraq, the engineering of an economic collapse in America, the corruption of our laws, of our national honor and our moral standing make it impossible for me to continue the war in Afghanistan.
No more Americans will die because of the criminality of a few. Are the few foreign terrorists or Americans, politicians, lobbyists, industrialist, bankers and their good friends overseas in Saudi Arabia or maybe Israel.
How can we order the deaths of thousands of Americans when the real "evil doers" at home run free? We know their names, we know their crimes. How can we bring justice and democracy to others when we, ourselves, have none?
Nearly 10,000 Americans are dead, tens of thousands wounded and trillions of dollars are missing. There is much more proof that these deaths and this massive theft was caused by a domestic conspiracy than any foreign intrigue.
First, we clean our own home, then we carry democracy to others."
Will we hear this tonight?
Veterans Today Senior Editor Gordon Duff is a Marine combat veteran and regular contributor on political and social issues.
December 01, 2009 "Veterans Today" -- Tonight, I will listen to the President tell me that it will take years to withdraw from Afghanistan. He will, out of political necessity tell a series of lies. He will lie by omission, failing to tell people that this war, our "good war" was, when the facts are examined, a farce. There has not been a credible word from Osama bin Laden since December, 2001, when his death was announced in the Islamic press. What other reason did we have to occupy Afghanistan and lead it into total ruin?
The President will also lie because he has been lied to. He will present solutions, solutions sending troops into harms way, troops meant to build a government and country that force of arms can only destroy.
Years of propaganda and war mongering has made it impossible for any honest dialog about war. Years of lying, lying for politics, lying for profit, lying in support of treasonous foreign interests has left us with nothing to build on. No honest voice is left, just screaming liars paid by thieves claiming to represent the right or the left.
Neither really exist. If it talks, if it squawks, it is paid off by someone and is probably lying. Our government has their own business, getting elected, taking care of rich constituents and making sure war profiteers keep raking it in.
Without a voice of opposition from the people, as there is certainly no opposition in Washington, especially since the GOP is tied to the apron strings of the insurance industry and big oil and has no time for simple people, there will be no voice to scream "STOP."
Yes, support the troops. Bring them home to their families, let the villagers in Afghanistan continue whatever they have been doing for 300 years and stay out of it. We have managed to build a massive economy around playing at war. How many lobbyists does it require to hold a village in Afghanistan?
How many Predator drones does it require to find a bed for a homeless veteran?
How many mercenaries does it take to teach an amputee how to walk?
How many intelligence analysts does it take to figure out that if you keep doing the same thing over and over and it doesn't work, but you keep doing the same thing anyway, it is a sign you are nuts?
How long is it going to take us to realize that NOBODY is on our side. We think we are the new Roman empire, the policeman of the world. America isn't Caesar's Rome, not even the Rome of Augustus. We are the Rome of Nero and Caligula, a society steeped in corruption, excess and debauchery. How many Americans think of Washington DC as a center of culture and stability?
Does anyone even think America has a policy or government? Are we a country or simply a group of people ruled by a government owned and operated by special interest groups who dip into our treasury at will, send our kids off to war for amusement serve the agendas of "flavor of the month" allies, often brutal dictatorships disguised as enlightened democracies.
Over 40 years ago, America began to awaken to the fact that the war in Vietnam was a senseless slaughter having nothing to do with American values or security. President Obama is the 3rd president in my lifetime elected based on his promise to end a war.
In 1952, Eisenhower promised peace in Korea. We still have troops there nearly 6 decades later and wait daily for war to break out again.
In 1968, Nixon promised a "secret plan" to end the war in Vietnam. His plan, fight for 4 more years, killing 20,000 more Americans, then abandon most of our POWs and give Vietnam to the communists.
Tonite we hear another secret plan to end a war. Will we hear the truth? Not hardly!
"8 years ago we invaded Afghanistan and a short time later, Iraq, to punish a small group of murderers that killed 3000 Americans. As time has gone on, we now know that much of what we believed about those attacks is false. Evidence now points, not only to terror groups, but to countries we thought to be friends and there is even evidence of complicity here at home.
After years of phony intelligence, propaganda campaigns and torturing false confessions out of detainees, nothing can be trusted.
Donald Rumsfeld tells it best. He went before the 9/11 Commission stating there was never any indication that terror attacks of the kind seen on 9/11 were possible nor did he receive any warning. We now know that nearly every word he and so many others told that commission were lies, unquestionable, proven and done with remorseless cynicism.
8 years, the illegal invasion of Iraq, the engineering of an economic collapse in America, the corruption of our laws, of our national honor and our moral standing make it impossible for me to continue the war in Afghanistan.
No more Americans will die because of the criminality of a few. Are the few foreign terrorists or Americans, politicians, lobbyists, industrialist, bankers and their good friends overseas in Saudi Arabia or maybe Israel.
How can we order the deaths of thousands of Americans when the real "evil doers" at home run free? We know their names, we know their crimes. How can we bring justice and democracy to others when we, ourselves, have none?
Nearly 10,000 Americans are dead, tens of thousands wounded and trillions of dollars are missing. There is much more proof that these deaths and this massive theft was caused by a domestic conspiracy than any foreign intrigue.
First, we clean our own home, then we carry democracy to others."
Will we hear this tonight?
Veterans Today Senior Editor Gordon Duff is a Marine combat veteran and regular contributor on political and social issues.
Monday, November 30, 2009
Medicare in Crisis: The Devastating Impacts of a Corporate Health Care Bill
Editor's NOTE:
I share Mr. Cooke's concerns re: the competing Senate and House Health Care bills. Both appear more or less to be reform "in name only" which benefit health insurance companies at the expense of the Middle class and working poor. Medicaid rates of reimbursement are already unconscionably low and Medicare reimbursement rates have either been frozen or have failed to keep pace with inflation for over a decade.
As a retired physician and surgeon who has worked in the nightmare that is "for-profit" health care, I favor universal single payer coverage for all Americans. If health insurance companies were eliminated entirely, provider's could be paid reasonable rates of reimbursement for services including increases tied to the rate of inflation (for more see THIS...) Given the fact that Congress is currently "owned" by elite special interests, such an option appears extremely unlikely any time soon. While the current situation is deplorable, I fear the passage of a health insurance industry "reform" bill in the current climate--would be far worse.
--Dr. J. P. Hubert
By Shamus Cooke
Global Research,
November 27, 2009
Wading through the endless debate over health care has exhausted the patience of most Americans — the zigzags, obscure language, and long-winded discussion is inherently repulsive.
But now the dust is starting to settle, and the Congressional vision for health care in the U.S. is emerging. Instead of being “progressive,” it will amount to a massive, corporate-inspired attack on American workers, the elderly, and the poor.
After months of confusion and delay, Congress has shipwrecked the popular energy over health care onto the jagged rock of corporate interests. More spectacularly, health care “reform” is being used as an opportunity to greatly advance corporate influence over social spheres long-dedicated to the working-class — seemingly harmless provisions carry with them enormous implications.
These devils hide in the details of the competing health care bills in Congress; both contain debilitating right-wing policies hidden within a progressive shell. Obama is indeed acting as the agent of change, to the great benefit of the U.S. corporate elite.
And although the final bill has yet to be crafted, there exists general agreements as to what the end version will look like. Americans will be forced to buy shoddy corporate insurance with no limit to the cost, no guarantee of quality, with large premiums and other tricks to further gouge consumers. If a public option emerges in the final bill — by no means a guarantee — it will be shrunken enough to insure very few people (2 percent of the U.S. population).
But it gets worse. How this health care “reform” will be paid for has implications that dwarf the above atrocities.
For example, the Democrats were determined to pass a health care bill that “will not add one cent to the deficit.” And they have succeeded: the House and Senate health care bills both plan to reduce the deficit by over $100 billion. But a second-grader could do the math here: more service does not equal less cost — a truism that dominates the for-profit health care industry.
So how does the government plan to save billions of dollars as they “help” millions of people?
The two biggest cost saving schemes are the most damaging. The first is the enormous attack on Medicare. Since its inception, the corporate elite wanted this program struck down. Now they have their man for the job — a Republican could never get away with such obvious treachery.
The Congressional Budget Office estimates that the Senate version of health care would cut $404 billion from Medicare and Medicaid; the house version would cut $570 billion. The final cut could be much more. Obama made the ridiculous claim that only “wasteful” parts of Medicare would be cut. The truth is far different.
One way that both Congressional health care bills will gut Medicare is referred to as “forced productivity gains” — cost saving measures essentially; trimming the fat.
What are these savings? The most mentioned device — by politicians and media alike — is the reduction of “wasteful tests” and procedures that doctors routinely perform, an idea that the health care mega-corporations love. It will save them billions, while having catastrophic effects on the health care of millions of people.
For example, the recent announcement that women will now be persuaded to cut back on screenings for breast cancer and cervical cancer have caused an uproar nationwide: people are correctly making the connection behind Congress’ “forced productivity gains” and the new “recommendations” that will be used by insurance companies to justify cutting these services, both of which will boost profits. The general agreement behind rationing health care in this way will be an attack on not only Medicare, but serve as the backbone of any health care bill passed, negatively effecting everyone unable to afford luxury health care.
Another piece of Medicare that’s being trimmed is Medicare Advantage, a favorite program of the elderly because of its comprehensive services. Premiums for this program are already rising drastically in anticipation of the health care bill’s passage, considered by Congress to be “wasteful.” Without this program, Medicare will be greatly devalued and be more appropriately named: “band-aides for seniors.”
Finally, The Senate health care bill attacks Medicare by reducing payments to doctors by 25 percent. If doctors receive such a drastic reduction in pay, they will simply refuse to see Medicare or Medicaid patients; people will thus be insured only on paper. The newly insured Medicaid patients under any new congressional bill will be sorely disappointed.
Once Medicare is undermined in the above ways, the corporate sponsored right-wing will make a very convincing argument that “Medicare doesn’t work”, leading to future cuts that will further destroy the program.
The second hidden disaster in financing a congressional health care bill is the tax on so-called “gold-plated” or “Cadillac” health insurance policies that some employers offer their workers. This tax is supposedly meant to apply to the health care policies that “elite” employees receive.
And while there should exist no complaints about taxing corporations, the motives behind this particular tax are intentionally deceiving. As it turns out, many, if not most workers in unions will be included in this tax, which, under the Senate version, will include any plan worth more than $8,000 for individuals and $21,000 for families. Hardly elite, considering the still-soaring costs for health care.
If this provision were to pass — and it’s very popular in Congress — the immediate reaction would be very predictable: employers would immediately drop their health care plans, forcing workers into the now-forced purchasing of inadequate health care. This is why unions oppose such a plan. California Democrat Pete Stark agrees: “Employers and insurers will reduce their benefits to avoid paying the proposed tax.”
Workers fortunate to have union contracts will be heavily pressured to concede their plans, which in the past they’ve sacrificed wage-increases to keep. Ultimately, employers will have a new excuse not to provide health care to workers.
Obama again used his superb intelligence to totally obscure the issue in support of the tax:
“I do think that giving a disincentive to insurance companies to offer Cadillac plans that don’t make people healthier is part of the way that we’re going to bring down health care costs for everybody over the long term.” Translation: he supports taxing the health care of union workers.
Overall, a compromise bill between the Senate and House versions will create utter disaster for the working-class. It will not signal a progressive “step in the right direction,” as many liberals claim. At minimum, it will be a step backward, though more likely such a bill will be an enormous regression, to a time where health care was the exclusive privilege of the wealthy.
The right-wing attacks on “Obamacare” — along with the media’s lack of questioning — have shielded the Democrats from any serious debate about the above questions, including many other concerns unmentioned here.
The trash legislation that Congress is producing is the direct consequence of the Democratic Party being dominated by giant corporations — in this case the health care industry. The two-party system is the political system of the corporate elite, who switch party affiliations when they find it convenient; many of them throw equal money at both parties.
A crucial prop in this broken political system needs to be removed and organized under its own strength. If the unions took their support from the Democrats, organized their members and resources into a new political party, and aggressively pushed reforms that benefited the majority of working-class Americans, U.S. democracy would be tremendously strengthened. Medicare could not only be saved, but expanded to everyone from birth to death and be considered a fundamental human right.
I share Mr. Cooke's concerns re: the competing Senate and House Health Care bills. Both appear more or less to be reform "in name only" which benefit health insurance companies at the expense of the Middle class and working poor. Medicaid rates of reimbursement are already unconscionably low and Medicare reimbursement rates have either been frozen or have failed to keep pace with inflation for over a decade.
As a retired physician and surgeon who has worked in the nightmare that is "for-profit" health care, I favor universal single payer coverage for all Americans. If health insurance companies were eliminated entirely, provider's could be paid reasonable rates of reimbursement for services including increases tied to the rate of inflation (for more see THIS...) Given the fact that Congress is currently "owned" by elite special interests, such an option appears extremely unlikely any time soon. While the current situation is deplorable, I fear the passage of a health insurance industry "reform" bill in the current climate--would be far worse.
--Dr. J. P. Hubert
By Shamus Cooke
Global Research,
November 27, 2009
Wading through the endless debate over health care has exhausted the patience of most Americans — the zigzags, obscure language, and long-winded discussion is inherently repulsive.
But now the dust is starting to settle, and the Congressional vision for health care in the U.S. is emerging. Instead of being “progressive,” it will amount to a massive, corporate-inspired attack on American workers, the elderly, and the poor.
After months of confusion and delay, Congress has shipwrecked the popular energy over health care onto the jagged rock of corporate interests. More spectacularly, health care “reform” is being used as an opportunity to greatly advance corporate influence over social spheres long-dedicated to the working-class — seemingly harmless provisions carry with them enormous implications.
These devils hide in the details of the competing health care bills in Congress; both contain debilitating right-wing policies hidden within a progressive shell. Obama is indeed acting as the agent of change, to the great benefit of the U.S. corporate elite.
And although the final bill has yet to be crafted, there exists general agreements as to what the end version will look like. Americans will be forced to buy shoddy corporate insurance with no limit to the cost, no guarantee of quality, with large premiums and other tricks to further gouge consumers. If a public option emerges in the final bill — by no means a guarantee — it will be shrunken enough to insure very few people (2 percent of the U.S. population).
But it gets worse. How this health care “reform” will be paid for has implications that dwarf the above atrocities.
For example, the Democrats were determined to pass a health care bill that “will not add one cent to the deficit.” And they have succeeded: the House and Senate health care bills both plan to reduce the deficit by over $100 billion. But a second-grader could do the math here: more service does not equal less cost — a truism that dominates the for-profit health care industry.
So how does the government plan to save billions of dollars as they “help” millions of people?
The two biggest cost saving schemes are the most damaging. The first is the enormous attack on Medicare. Since its inception, the corporate elite wanted this program struck down. Now they have their man for the job — a Republican could never get away with such obvious treachery.
The Congressional Budget Office estimates that the Senate version of health care would cut $404 billion from Medicare and Medicaid; the house version would cut $570 billion. The final cut could be much more. Obama made the ridiculous claim that only “wasteful” parts of Medicare would be cut. The truth is far different.
One way that both Congressional health care bills will gut Medicare is referred to as “forced productivity gains” — cost saving measures essentially; trimming the fat.
What are these savings? The most mentioned device — by politicians and media alike — is the reduction of “wasteful tests” and procedures that doctors routinely perform, an idea that the health care mega-corporations love. It will save them billions, while having catastrophic effects on the health care of millions of people.
For example, the recent announcement that women will now be persuaded to cut back on screenings for breast cancer and cervical cancer have caused an uproar nationwide: people are correctly making the connection behind Congress’ “forced productivity gains” and the new “recommendations” that will be used by insurance companies to justify cutting these services, both of which will boost profits. The general agreement behind rationing health care in this way will be an attack on not only Medicare, but serve as the backbone of any health care bill passed, negatively effecting everyone unable to afford luxury health care.
Another piece of Medicare that’s being trimmed is Medicare Advantage, a favorite program of the elderly because of its comprehensive services. Premiums for this program are already rising drastically in anticipation of the health care bill’s passage, considered by Congress to be “wasteful.” Without this program, Medicare will be greatly devalued and be more appropriately named: “band-aides for seniors.”
Finally, The Senate health care bill attacks Medicare by reducing payments to doctors by 25 percent. If doctors receive such a drastic reduction in pay, they will simply refuse to see Medicare or Medicaid patients; people will thus be insured only on paper. The newly insured Medicaid patients under any new congressional bill will be sorely disappointed.
Once Medicare is undermined in the above ways, the corporate sponsored right-wing will make a very convincing argument that “Medicare doesn’t work”, leading to future cuts that will further destroy the program.
The second hidden disaster in financing a congressional health care bill is the tax on so-called “gold-plated” or “Cadillac” health insurance policies that some employers offer their workers. This tax is supposedly meant to apply to the health care policies that “elite” employees receive.
And while there should exist no complaints about taxing corporations, the motives behind this particular tax are intentionally deceiving. As it turns out, many, if not most workers in unions will be included in this tax, which, under the Senate version, will include any plan worth more than $8,000 for individuals and $21,000 for families. Hardly elite, considering the still-soaring costs for health care.
If this provision were to pass — and it’s very popular in Congress — the immediate reaction would be very predictable: employers would immediately drop their health care plans, forcing workers into the now-forced purchasing of inadequate health care. This is why unions oppose such a plan. California Democrat Pete Stark agrees: “Employers and insurers will reduce their benefits to avoid paying the proposed tax.”
Workers fortunate to have union contracts will be heavily pressured to concede their plans, which in the past they’ve sacrificed wage-increases to keep. Ultimately, employers will have a new excuse not to provide health care to workers.
Obama again used his superb intelligence to totally obscure the issue in support of the tax:
“I do think that giving a disincentive to insurance companies to offer Cadillac plans that don’t make people healthier is part of the way that we’re going to bring down health care costs for everybody over the long term.” Translation: he supports taxing the health care of union workers.
Overall, a compromise bill between the Senate and House versions will create utter disaster for the working-class. It will not signal a progressive “step in the right direction,” as many liberals claim. At minimum, it will be a step backward, though more likely such a bill will be an enormous regression, to a time where health care was the exclusive privilege of the wealthy.
The right-wing attacks on “Obamacare” — along with the media’s lack of questioning — have shielded the Democrats from any serious debate about the above questions, including many other concerns unmentioned here.
The trash legislation that Congress is producing is the direct consequence of the Democratic Party being dominated by giant corporations — in this case the health care industry. The two-party system is the political system of the corporate elite, who switch party affiliations when they find it convenient; many of them throw equal money at both parties.
A crucial prop in this broken political system needs to be removed and organized under its own strength. If the unions took their support from the Democrats, organized their members and resources into a new political party, and aggressively pushed reforms that benefited the majority of working-class Americans, U.S. democracy would be tremendously strengthened. Medicare could not only be saved, but expanded to everyone from birth to death and be considered a fundamental human right.
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