When you compare them head-to-head, the Obama and Romney tax plans are nearly identical:

Mitt Romney, the Republican candidate, is offering a 20 percent tax cut for everyone. Given the mood of the conservatives in the United States today, that may not surprise you. But even President Barack Obama, who is routinely described as a socialist by his opponents, is peddling a plan under which 99 percent of Americans would pay less than they did under the last Democrat in the White House, Bill Clinton.

John O'Brennan cuts to the heart of the Eurozone crisis, outlining the political consequences of issuing aloof, one-size-fits-all austerity requirements from afar:

The European crisis is as much a crisis of politics as economics. The current paralysis of the Greek political system demonstrates the point very clearly. EU policy has actively contributed to this crisis by effectively sealing off discussion of the political problems thrown up by austerity.

Budgetary policy is at the core of traditional democratic politics in Europe but the management of the euro zone is increasingly being effected not through democratic institutions but via a centralised and depoliticised form of technocratic fiat. The “stability” narrative has triumphed over the need for legitimacy as the crisis in Europe has deepened.

Ivan Krastev, the eminent political scientist, argues that we have now arrived at a point where national governments have politics but are no longer in control of policy, including budgetary policy, which is moving via the fiscal treaty and other measures to the EU level.

On the other side of this divide the European Union has policies but no politics, since decisions are increasingly being made by technocratic managers rather than directly elected representatives of the European public. The euro zone crisis has thus amplified an existing problem – the absence of both a European citizenry and a transparent European level political process.

The whole thing. Read.

h/t RCW.

The Guardian's Helena Smith talks to Greek leftist leader Alex Tsipras:

Tsipras, who turns 38 in July, wants me to know that the war is not personal. The enemy is not Berlin, until now the biggest provider of the monumental rescue funds keeping the debt-stricken economy afloat. "It is not between nations and peoples," he says. "On the one side there are workers and a majority of people and on the other are global capitalists, bankers, profiteers on stock exchanges, the big funds. It's a war between peoples and capitalism … and as in each war what happens on the frontline defines the battle. It will be decisive for the war elsewhere."

Greece, he says, has become a model for the rest of Europe because it was the first country to fall victim to the enforcement of hard-hitting "growth through austerity" policies pursued in the name of resolving the crisis.

"It was chosen as the experiment for the enforcement of neo-liberal shock [policies] and Greek people were the guinea pigs," he insists.

"If the experiment continues, it will be considered successful and the policies will be applied in other countries. That's why it is so important to stop the experiment. It will not just be a victory for Greece but for all of Europe."

Even the old capitalist robber-barons understood that the way to get wealthy was to create wealth for all while making sure you kept the lion's share. Neoliberal austerity policies are just asset stripping under a false banner.

Not sure exactly when I said it, but I did predict that Greece would exit the Euro. I also said that it should leave the Euro sooner, rather than later and do so on its own terms. Now elite opinion has decided it's okay for Greece to exit. Mostly because the neoliberals have already raped the economy there. You heard it here first.

The results of this poll sort of reflect my own feelings and experiences with Facebook:

According to a new AP-CNBC poll, 57 percent of Facebook users say they never click ads or other sponsored content when they use the site, with another 26 percent saying they hardly ever engage in such activity.

While the company makes money, in part, simply by displaying sponsored content, user clicks are a critical part of an advertiser’s calculus when gauging how effective those ads are and how much they’re willing to pay for them. In the first quarter, Facebook generated 82 percent of its $1.06 billion in revenue from advertising sales. In the company’s online IPO pitch to retail investors, CFO David Ebersman says the company is working to make ads “more relevant, more social, and more engaging” as it looks to grow.

If you are the CEO of a major global bank and you have to announce a $2.0 billion trading loss, you will no doubt feel that the shareholders, regulators, and reporters are all against you. But if you announce that the loss occurred in a portfolio that just six weeks earlier was the subject of criticism in the press, and which you described as nothing more than “a tempest in a teapot”, you are entitled to feel that the gods are against you.

The gods definitely have it in for Jaime Dimon, CEO of JP Morgan Chase, the legendary “fortress balance sheet” bank that prides itself on having avoided problems during the housing bust and credit crisis of 2007-2008. Someone inside the bank blew a large cannonball through the bank’s fortress walls, and it seems likely to have been “the Whale” of the credit derivatives market, JP Morgan’s Bruno Michel Iksil.

David Wearing at New Left Project reviews Belén Fernández's recent book, The Imperial Messenger – Thomas Friedman At Work, noting how Friedman's banal pro-imperialist bloviation reflects -- and helps to further -- an all-too entrenched broader mentality:

Friedman puts the Iraqi public’s failure to appreciate the benefits of foreign occupation down to “the wall in the Arab mind”. As Fernández notes, “the Orientalist tendency to anchor Oriental subjects in antiquity, where they remain in perpetual need of civilisation by the West and its militaries, is viewable time and again in Friedman’s discourse”. Arabs and Muslims are “backward”. Iraqis “hate each other more than they love their own kids”. Shortly after the invasion of 2003, he opines that “it would be idiotic to even ask Iraqis here how they felt about politics. They are in a pre-political, primordial state of nature”.

For the American missionaries, the noble mission of raising the savages out of the swamp is not without its dangers. “While we would like an Iraqi national movement – building Shiites, Kurds and Sunnis – to coalesce, we don’t want it coalescing in opposition to us”. Evidently then there is a limit to which even this staunch advocate of enlightened Western values will support democracy, the limit being whether the liberated people then bow before the might of western power.

All of this would be of limited relevance were Friedman an isolated figure, rather than the ugly face of ideas and assumptions which have a much wider currency. His complaint that American occupying forces in Iraq “are baby-sitting a civil war” is a direct echo of Barack Obama’s promise during the 2007 presidential election campaign that “we're not going to babysit a civil war”, as though the bloodbath engulfing the country was attributable to the infantilism of its people and not to the effects of it being violently invaded by a foreign power. Elsewhere, Friedman’s likening of the US occupation of Afghanistan to the adoption of a “special needs baby” bears more than a passing resemblance to Donald Rumsfeld’s description of Washington’s role in teaching Iraqis how to run their own country:

“Getting Iraq straightened out was like teaching a kid to ride a bike: 'They're learning, and you're running down the street holding on to the back of the seat. You know that if you take your hand off they could fall, so you take a finger off and then two fingers, and pretty soon you're just barely touching it. You can't know when you're running down the street how many steps you're going to have to take. We can't know that, but we're off to a good start.”

The flip side of this casual racism is of course the chauvinistic view of the nature of Western civilisation; the paternal figure to the Iraqi and Afghan infants. For Friedman, “without a strong America holding the world together, and doing the right thing more often than not, the world really would be a Hobbesian jungle”, a faith in the benevolence of Western power which is shared right across the spectrum of mainstream intellectual opinion.

Related: If you have not yet done so, please read--nay, experience--Matt Taibbi's legendary takedown of The World is Flat. If snark were whiskey we'd all be shit-faced before breakfast.

<

Michael Hudson asks: "In light of the enormous productivity gains since the end of World War II – and especially since 1980 – why isn’t everyone rich and enjoying the leisure economy that was promised?"

The answer (per Hudson) is painfully obvious, but bears repeating (ad infinitum):

What was applauded as a post-industrial economy has turned into a financialized economy. The reason you have to work so much harder than before, even when wages rise, is to carry your debt overhead. You’re unable to buy the goods you produce because you need to pay your bankers. And the only way that you can barely maintain your living standards is to borrow even more. This means having to pay back even more in years to come.

That is the Eurozone plan in a nutshell for its economic future. It is a financial plan that is replacing industrial capitalism – with finance capitalism.

Industrial capitalism was based on increasing production and expanding markets. Industrialists were supposed to use their profits to build more factories, buy more machinery and hire more labor. But this is not what happens under finance capitalism. Banks lend out their receipt of interest, fees and penalties (which now yield credit card companies as much as interest) in new loans.

The problem is that income used to pay debts cannot simultaneously be used to buy the goods and services that labor produces. So when wages and living standards do not rise, how are producers to sell – unless they find new markets abroad? The gains have been siphoned off by finance. And the financial dynamic ends up in austerity.

And to make matters worse, it is not the fat that is cut. The fat is the financial sector. What is cut is the bone: the industrial sector. So when writers refer to a post-industrial economy led by the banks, they imply deindustrialization. And for you it means unemployment and lower wages.

As they say, read the whole damn thing.

And weep.

h/t

Originally posted at bastard.logic

(Image: jesse.millan, Flickr)

Al-Jazeera (May 4) - from Nikolas Kosmatopoulos's provocative Op-Ed just prior to this Sunday's elections, May 5:

Urban myth has it that a slogan by the Spanish protesters in Puerta del Sol fuelled the spark for the Greek Tahrir - Syntagma Square - in spring 2011: "Be silent or you will wake up Greece".
 

The "Greek crisis" has had at least two side effects so far: it demonstrated that official politics has no vision whatsoever, and that mainstream journalism has no shame...

While workers and pensioners throughout the country are deprived of basic means for survival, both parties ask them to be patient and make sure they do not die until May 6.

In the face of all this, it appears essential to ask whether, instead of drafting an electoral program, it would be more useful to craft everyday programs of population mobilisation against elite-driven violence and misery.

Read the entire piece (photo: BBC).

First, do nothing:

Obama turned his call for middle-income tax breaks into law within a month of taking office, incorporating a $400-a-person tax credit for workers into the 2009 stimulus law. In late 2010, with the economy still weak and Republicans gaining political clout, Obama agreed to an $858 billion tax cut that extended all of the George W. Bush-era tax cuts for two years.

"The tax policy has been substantially in the conservative direction whereas the rhetoric has gone in the exact opposite direction," said Don Susswein, a tax aide to former Republican Senator Bob Dole who said he supported Obama in 2008.

It often amuses me what rationales people come up with when a market moves in one direction or another.

To-wit: an analyst in England makes a positive comment about the banking industry, and glory be! the FTSE jumps up.

The comments specifically addressed this broker's belief...a broker, mind you, not a government official...that central banks around the world will address the lagging economy with stimulus packages.

Gee, thanks for pointing that out, Captain Obvious! A central tenet to Keynesian economics gets reitertated in the national press and markets suddenly facepalm and go "Now why didn't I think of that?"

Grace Livingstone | Apr 4

The Independent - Speculation by large investment banks is driving up food prices for the world's poorest people, tipping millions into hunger and poverty. Investment in food commodities by banks and hedge funds has risen from $65bn to $126bn (£41bn to £79bn) in the past five years, helping to push prices to 30-year highs and causing sharp price fluctuations that have little to do with the actual supply of food, says the United Nations' leading expert on food.

Hedge funds, pension funds and investment banks such as Goldman Sachs, Morgan Stanley and Barclays Capital now dominate the food commodities markets, dwarfing the amount traded by actual food producers and buyers. Purely financial players, for example, account for 61 per cent of investment on the wheat futures market, according to the World Development Movement report Broken Markets.

Speculative investment in agricultural commodities in 2011 was 20 times the amount spent by all countries on agricultural aid. Goldman Sachs, the largest player in the agricultural commodities market, earned £600m from food speculation in 2009, and Barclays Capital, the world's third-largest player and largest British bank in this market, earned up to £340m in 2010, according to the report. Goldman Sachs and Barclays Capital declined to comment.

Before it was deregulated in the year 2000, the agricultural commodities futures market was used mainly by farmers and food buyers seeking to insure themselves against changes in the prices of products such as wheat, maize and sugar. When George W Bush passed the Commodities Futures Modernization Act 12 years ago, there was an influx, led by Goldman Sachs, of purely financial players who had no interest in ever buying food, but who sought solely to profit from changes in food prices, says Olivier De Schutter, the UN special rapporteur on the right to food.

The US economy is on the road to recovery, right? That’s what all the economists and financial analysts say. Unemployment has dropped down to 8.3%, unemployment claims are now at a level last seen in 2008 before the economy fell off a cliff, almost all the TBTF banks have just passed the recent Fed stress tests and are now allowed to use their excess capital to pay dividends and buy back their stocks, inflation is tame if you go by official government statistics (especially core inflation that the Fed loves to look at because it removes the effects of food and oil price increases), and finally all major economic indicators are flashing green lights.

Patrick Wintour | Mar 16

Guardian Online - George Osborne will announce plans to pay lower salaries to public sector workers in poorer parts of the country in his budget next week.

The chancellor will argue that public sector pay should mimic the private sector and be more reflective of local economies. He intends to start the process in three Whitehall departments in the coming financial year, as part of a phased introduction.

Critics say the move will entrench economic divisions between north and south and depress regions of the country already struggling in the economic downturn.

It has not yet been decided if localised pay will apply only to new staff or to existing staff as well, but it was being stressed that no current employee would suffer a pay cut. Instead pay levels will gradually be adjusted to take account of costs, leading to larger pay rises in the south-east where some labour shortages exist.
 

The dismemberment/privatisation of the UK civil service continues...
Hey, does that mean members of Parliament should also suffer this pay differential? ;-)

I suspect that's Greg Smith's new nickname in some circles.

Goldman Sachs Group Inc. (GS) saw $2.15 billion of its market value wiped out after an employee assailed Chief Executive Officer Lloyd C. Blankfein’s management and the firm’s treatment of clients, sparking debate across Wall Street.

The shares dropped 3.4 percent in New York trading yesterday, the third-biggest decline in the 81-company Standard & Poor’s 500 Financials Index, after London-based Greg Smith made the accusations in a New York Times op-ed piece.

Truth-Teller Found Dead In Puddle Of Own Vomit

A departing Goldman Sachs Group Inc. (GS) employee mounted an unprecedented public attack on its “toxic and destructive” culture in a New York Times opinion piece, becoming the first serving insider to openly criticize the firm.

Greg Smith, identified by the newspaper as an executive director and head of the firm’s U.S. equity derivatives business in Europe, will leave the firm after 12 years, blaming Chief Executive Officer Lloyd Blankfein and President Gary Cohn for losing hold over the firm’s culture. Executive directors are junior to managing directors and partners, the most senior rank.

From the Globe and Mail by Neil Reynolds

Call it the final taming – the final domestication – of capitalism.

In February, a French commercial court ruled that Google Inc. broke the law when it allowed people in France to use Google Maps for free. Declaring the practice “unfair,” the court ordered the company to pay Bottin Cartographes, a French competitor, €500,000 in damages and a €15,000 fine. The court ignored the fact that Google Maps are a strategic service that enables the company to make money by giving things away. It also ignored the fact that OpenStreetMap, a wiki-based free service, has already mapped the world. (Google says it will appeal.)

..... It has taken a century to turn capitalism from an awesome force of nature, rude, raw and rambunctious, to the subservient thing it is today. Writing more recently, Mr. Epstein described contemporary capitalism as a spent force – trending, at least, to stagnation (from Latin: swamp). In the advanced economies, growth turned sluggish (in real-dollar terms) a generation ago. Now these exhausted economies, deep in debt, struggle to crank out a single percentage point of real-dollar growth a year. More at the link

The time-honored advice brokers have always given their investment clients is to “diversify, diversify, diversify!” It’s the basic law of investment – Investment 101 you might say – never put all your eggs in one basket. Which is why it is so odd to see the CEO of one of the largest investment funds in the world –BlackRock – insist that his customers ignore this basic rule and invest everything they have in equities.

CEO Laurence D. Fink says that we are living in a “New World” where it is impossible to earn a decent return on traditional bonds or other conservative investments. He’s right about that; Fed Chairman Ben Bernanke has made it clear he intends to keep interest rates at zero percent through at least the end of 2014. Maybe this New World is a welcome relief for borrowers, many of whom are desperate to reduce their debts, or at least the interest cost on their debts if they can refinance at lower rates.

The Wall Street Journal suggests that big banks should be broken up. Citing the inadequacy of the Volcker Rule in the Dodd-Frank bill now wending its way through Congress, the Journal states any real reform should include "a Congressional plan either for allowing large banks to fail or for breaking them up."

Horrors! Nationalizing banks? The Murdoch-owned Wall Street Journal?

More astounding: Jamie Dimon, the head of JP Morgan Chase Bank and an proud 1%er (he once claimed to feel safer in Lebanon than amongst the Occupy Wall Street members) is for raising his own taxes:

Mitt Romney, tribune of the people, still doesn't seem to get a simple concept: Social Security is popular. With everybody. And particularly with older tea-party-supporting white voters who can often be counted on to be conservative on numerous other issues, and turn out in elections in key swing states.

It's pretty simple, really. It is perhaps the most successful government program ever, is the largest insurance program for children, and seniors benefiting from their earned benefits during their golden years are rather hesitant to lay it down on the altar of Mitt's very own Golden Calf -- Wall Street. Quelle surprise, as Mitt would have said during his tour as a Mormon missionary in France.

I came across this highly informative interview with Dr. Lacy Hunt of Hoisington Investment Management on Mish's blog: Global Economic Trend Analysis. He found it on another blog: johnmauldin.com, and the interviewer is financial journalist Kate Welling. A sample quote:

Kate Welling: I suppose all this means you expect a recession this year?

Dr. Lacy Hunt Well, consumer spending will slow this year very dramatically from a very weak
base. We had a decline in real disposable income in 2011. GDP rose, but GDP
measures spending, not prosperity. In 2011, as is often the case, when inflation rises,
households initially try to maintain their standard of living. So in the face of rising
inflation and trailing wages, which was the story in 2011, families resorted to
increased credit card usage or to drawing down their saving. But in addition to a
decline in real disposable income in 2011, we also saw a net decline in net worth
[lower chart below]. And a year-over-year decline in net worth has been associated
with the start of all the recessions since 1969.

We touch on many of the topics discussed in this interview, including in our recent conversations about Greece. It is well worth the time to go through all 29 pages of the interview.

http://www.johnmauldin.com/images/uploads/pdf/mwo021312.pdf

The Arab Spring opened on the road in Tunisia before hitting the big time in Tahrir Square, Cairo, Egypt. The workers of the unofficial Egyptian union movement had fought the neoconservative run government of Hosni Mubarak for years. This was their moment. Unfortunately, there were others present who wanted to make it their moment. Some of them, sixteen representatives of U.S. supported non-government organizations (NGOs), have been indicted by the Egyptian government for meddling in the internal political affairs of that country (Feb 5, 2012)

SourceWatch

Traders in New York this morning were greeted with this happy headline from The Wall Street Journal:

US stock futures higher; buoyed by Greece

Yes indeed, the Dow Jones index is set to open at least 70 points higher because the Greek parliament approved the additional austerity measures demanded by the European Union, the European Central Bank, and the International Monetary Fund. In exchange for €130 billion in a second bailout by the “Troika”, as the three lending institutions are called, Greece will have to cut its minimum wage by 22% and the government will have to lay off an additional 150,000 workers. This is in a country that is in its fifth year of recession, with an official unemployment rate of 21%. Business has virtually collapsed, with many private sector companies on the verge of bankruptcy. The health system is so starved for funds that a bacteria resistant to all medicines is raging through hospitals, forcing the chronically ill to decide whether to even risk seeking professional care. Poverty is reaching extreme levels and is well-entrenched among what used to be the middle class. Children are sent to school so hungry that they are fainting in the classrooms. As of last night, the crowds that were storming through Athens and other large cities no longer were content to throw rocks at the police; Molotov cocktails were used to set at least forty buildings in Athens on fire. The police in Athens, facing crowds estimated from 80,000 to 100,000 people, were forced off Syntagma Square, and appeared to have run out of tear gas. Journalists described the business center of Athens as a war zone. The country is slipping into social disorder, if not anarchy. But stock markets in Europe were up today on the happy news that the Greek parliament approved the additional austerity measures.

More like Master of their Own Domain, now.

Enclosed within this article is a hint that the Times of New York could get their hands on the real story, if they wanted to:

When Fred Wilson, a prominent New York venture capitalist who has backed Twitter and Zynga, wanted to watch the Knicks game last month, he got an unpleasant surprise. Time Warner Cable was not showing the game because of a contract dispute.

Frustrated, he turned to the Internet for help. Within minutes he was streaming the game illegally on his big-screen TV. [...]