The Unspeakable R Word

Why nobody in Washington wants to say recession.

By Daniel Gross
Posted Saturday, March 1, 2008, at 7:17 AM ET

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Testifying before Congress, Federal Reserve Chairman Ben Bernanke conducted a master class in the art of understatement last week. "The economic situation has become distinctly less favorable since the time of our July report," he said. Consumers, who account for 70 percent of U.S. economic activity, have been hamstrung by the "continuing contraction of the U.S. housing market," rising energy costs, and slowing job creation. And thanks to "tighter credit conditions for some firms," business spending should be "subdued" for the next several months.

Distinctly less favorable? Subdued? It calls to mind Japanese Emperor Hirohito's comment on Aug. 14, 1945, that "the war situation has developed not necessarily to Japan's advantage."

Tomgram: Iraq, 2003-2008, Two Recipes for Disaster

The Commander-in-Chef Cooks Up a Storm
Recipes for Disaster in Iraq

By Tom Engelhardt and Frida Berrigan

In the week that oil prices once again crested above $100 a barrel and more Americans than at any time since the Great Depression owed more on their homes than the homes were worth; in the year that the subprime market crashed, global markets shuddered, the previously unnoticed credit-default swap market threatened to go into the tank, stagflation returned, unemployment rose, the "R" word (for recession) hit the headlines (while the "D" word lurked), within weeks of the fifth anniversary of his invasion of Iraq, the President of the United States officially discovered the war economy.

George W. Bush and Laura Bush were being interviewed by NBC's Ann Curry when the subject turned to the war in Iraq. Curry reminded the President that his wife had once said, "No one suffers more than their president. I hope they know the burden of worry that's on his shoulders every single day for our troops."

Why Health Insurance Doesn't Work

It is actually against their interest for insurers to compete on giving us the best care. It's not simply that they're not doing it, but given the structure of the marketplace, they shouldn't do it.

Ezra Klein | February 27, 2008

'The state's largest for-profit health insurer is asking California physicians to look for conditions it can use to cancel their new patients' medical coverage," said the first line of an expose in the Los Angeles Times earlier this month. The subject was Blue Cross' practice of enlisting doctors to help them deny the claims of sick individuals.

What's strange, however, is that everyone acted like the insurer was doing something wrong. Gov. Arnold Schwarzenegger accused them of asking doctors to "rat out the patients." Hillary Clinton gave the company a similar lashing, in the same tone of moral outrage used by most of those quoted in the article. Within a few days, the policy was ended.

Afghanistan mission close to failing - US

After six years of US-led military support and billions of pounds in aid, security in Afghanistan is "deteriorating" and President Hamid Karzai's government controls less than a third of the country, America's top intelligence official has admitted.

Mike McConnell testified in Washington that Karzai controls about 30% of Afghanistan and the Taliban 10%, and the remainder is under tribal control.

The Afghan government angrily denied the US director of national intelligence's assessment yesterday, insisting it controlled "over 360" of the country's 365 districts. "This is far from the facts and we completely deny it," said the defence ministry.

Is Bush to Blame for the Economy?

In fairness, Bush, like all presidents, does not deserve all the blame (or credit) for the economy's performance under his watch. But he turned a blind eye to the mounting evidence of an economic crisis.

Dean Baker | February 25, 2008

Last summer, President Bush told the American people that "the American economy is the envy of the world." He continued, "The fundamentals of our economy are strong. ... Job creation is strong. Real after-tax wages are on the rise. Inflation is low." None of this was exactly true then, but it is certainly not true now. When President Bush signed the stimulus package he finally acknowledged what the rest of us already knew: The economy is in real trouble. The collapse of the housing bubble is throwing the economy into a recession, and quite possibly a very severe recession. For most workers this means that the economic situation is about to go from bad to worse.

Comcast Blocks Access To Net Neutrality Meeting

by huntsu

Tue Feb 26, 2008 at 12:38:04 PM PST

[Thanks to everyone who rec'd this diary, especially since it really wasn't too much related to me. Boing Boing deserves the credit for it, but I'm happy to take the rec! Please also visit the great state blog Blue Jersey where I also post.]

Ever wondered before if big providers would block access to certain content on the Internet if there were no forced neutrality? Well, Comcast answered the question themselves by blocking access to a Net Neutrality meeting at Harvard. (via BoingBoing)

ACLU calls out US over 'absurd bloating' of terror watch list

More that 900,000 people are currently listed as suspected terrorists on the US government's "do not fly" list, and that number will grow to beyond 1 million by summer, says the American Civil Liberties Union.

"If there were a million terrorists in this country, our cities would be in ruins," Barry Steinhardt, director of the ACLU's Technology and Liberty Program, stated in a press release from the group. "The absurd bloating of the terrorist watch lists is yet another example of how incompetence by our security apparatus threatens our rights without offering any real security."

'Bipartisan' Think Tank Attacks Democrats

By Spencer Ackerman 02/26/2008

A neo-conservative but ostensibly bipartisan counterterrorism think tank has lost all its Democratic board members by running an attack ad in Democratic congressional districts through an affiliated enterprise.

The think tank, called the Foundation for the Defense of Democracies, is a 501(c )3—meaning it was incorporated as a non-profit and non-partisan organization, barred from political activity. Last week, it established Defense of Democracies, a 501(c )4 "non-profit, non-partisan advocacy organization," that ran an advertisement urging the House of Representatives to pass the Senate’s version of a bill providing retroactive legal immunity to telecommunications companies that collaborated with the Bush administration’s constellation of warrantless surveillance programs. The arrangement is probably legal, experts say, but the parent think tank receives several grants from the State Department—at least one is worth $487,000—for democracy-promotion programs, making its political activities questionable.

The $3 Trillion War

After wildly lowballing the cost of the Iraq conflict at a mere $50 to $60 billion, the Bush administration has been concealing the full economic toll. The spending on military operations is merely the tip of a vast fiscal iceberg. In an excerpt from their new book, the authors calculate the grim bottom line.

by Joseph E. Stiglitz and Linda J. Bilmes April 2008

In March 19, 2008, the U.S. will have been in Iraq for five years. The Bush administration was wrong about the need for the Iraq war and about the benefits the war would bring to Iraq, to the region, and to America. It has also been wrong about the full cost of the war, and it continues to take steps to conceal that cost.

John McCain's Bizarre 'Conservative Problem'

By Matt Taibbi, RollingStone.com
Posted on February 28, 2008, Printed on February 28, 2008
http://www.alternet.org/story/78024/

It's the day before the Virginia primary, and darkness has fallen outside the Aviation Museum in Richmond. Inside, presumptive Republican nominee John McCain stands proudly before a museum-exhibit version of his own A-4 Navy jet fighter, plowing through the Poconos-stand-up portion of his stump speech.

I've heard this shtick so many times by now that a kind of campaign echolalia has kicked in -- I find myself involuntarily blurting out McCain's punch lines before he even starts a joke. At present, we're about two minutes shy of a prison joke that ends with The food was a lot better in here when you were governor!

Global warming twice as lethal as previously assumed

Increased air pollution could make global warming an even bigger killer.

A new study reveals that air pollution associated with elevated carbon dioxide levels is already responsible for around 22,000 deaths every year. When these are added to casualties from extreme weather events, it doubles the number of fatalities that can be linked to global warming.

Consumers fight rising use of hidden fees

Tony Pugh | McClatchy Newspapers
last updated: February 27, 2008 06:58:46 PM

WASHINGTON — Hidden fees and surcharges that drive up the cost of everything from phone service to concert tickets are spreading like wildfire, creating a nuisance for U.S. consumers and making truth in billing little more than a hollow promise.

Some hotels impose automatic towel, bellman and grounds-keeping fees. Airlines charge up to $25 to check an extra bag. Want to terminate your cell phone service? Don't be surprised by a $200 cancellation fee.

Many of the charges are undisclosed, buried in contract fine print or listed as an unclear line item on a bill.

Producer-price leap was highest in 3 decades

Kevin G. Hall | McClatchy Newspapers
last updated: February 27, 2008 07:49:32 AM

WASHINGTON — A sharp jump in wholesale inflation and $100-a-barrel oil prices combined Tuesday to heighten fears that inflationary pressures will drive up mortgage rates and deepen problems in a housing sector that's dragging down the economy.

Wholesale inflation as measured by the producer price index jumped 1 percent in January, according to the Labor Department. Overall producer prices rose 7.4 percent over the past 12 months, the fastest clip since 1981.

The rise in producer prices was driven by higher prices for food, energy and medicine and was more than double the 0.4 percent rise that most mainstream economists forecast.

Meat Wagon: Cow-feed misdeeds

More trouble with ethanol waste as cow chow

Posted by Tom Philpott at 4:03 PM on 25 Feb 2008

In Meat Wagon, we round up the latest outrages from the meat industry.

Remember the good old days, when gigantic meat and dairy producers stuffed cows into feedlots and fed them corn? Sure, cows evolved to eat grass, and corn wears out their livers (and makes their digestive tracts friendly to E. coli 0157, a strain harmless to cows but deadly to humans).

Yet we may soon look back fondly on those days. The government-mandated spike in ethanol production has made corn a pricey luxury for feedlot operators. To cut costs, they're scrambling to substitute scarce corn for abundant distillers grains -- the mush that's left over from corn after the ethanol process.

Ben Bernanke's high-wire act

Fed chief, in first of two days of testimony on Capitol Hill, acknowledges troubling signs about economic growth but also raises concerns about inflation.

By David Ellis, CNNMoney.com staff writer
February 27 2008: 5:07 PM EST

WASHINGTON (CNNMoney.com) -- For Federal Reserve Chairman Ben Bernanke, running the central bank has become an increasingly challenging high-wire balancing act.

All of Wall Street was watching the Fed chairman on Wednesday when he headed to Capitol Hill to outline the trio of challenges facing the Fed: an economy at risk of falling into a recession, topsy-turvy financial markets and the rising risk of inflation.

The world's insurance policy

So the first batch of the world's crop seeds is now packed away deep in the cold Svalbard mountainside, and the vault's doors, for the time being, are once again sealed. In total, more than 100 million seeds, representing some 250,000 individual strains of almost 100 major crops, from sorghum to sunflowers, have been loaded up in vault number 2 (I'm not sure why they started with vault no. 2 - although it may have been something to do with the fact that during the opening, vault no. 1 was playing host to 150 delegates and about a dozen live musical performers). Over 11 tonnes of seeds, in an impressive 656 boxes, were loaded up and locked away in little more than an hour.

So what now for the Global Seed Vault? Eventually, the collection will grow until it includes almost every crop strain in existence - as many as 1.5 million different seed types. Assembling this collection will mean taking delivery of millions upon millions of seeds, all carefully selected by the local and national seed banks that own them.

Sumatran deforestation driving climate change and species extinction, report warns

The destruction of Sumatra's natural forests is accelerating global climate change and pushing endangered species closer to extinction, a new report warned today.

A study from WWF claims that converting the forests and peat swamps of just one Sumatran province into plantations for pulpwood and palm oil is generating more annual greenhouse gas emissions than the Netherlands, and is endangering local elephant and tiger populations.

Dave Lindorff: The Welch Whitewash: We Still Don't Know What That Aug. 30 Nuke Incident Was About

Submitted by BuzzFlash on Tue, 02/26/2008 - 5:02pm.

Dave Lindorff

A new report on the August 30 incident in which six nuclear-armed advanced cruise missiles were effectively "lost" for 36 hours, during which time they were, against all regulations, flown in launch position mounted on a pylon on the wing of a B-52H Stratofortress, from Minot AFB in North Dakota across the continental U.S. to Barksdale AFB in Louisiana, has left unanswered some critical questions about the event.

McCain Withheld Controversial Abramoff Email

On the stump, Sen. John McCain often cites his work tackling the excesses of disgraced lobbyist Jack Abramoff as evidence of his sturdy ethical compass.

A little-known document, however, shows that McCain may have taken steps to protect his Republican colleagues from the scope of his investigation.

In the 2006 Senate report concerning Abramoff's activities, which McCain spearheaded, the Arizona Republican conspicuously left out information detailing how Alabama Gov. Bob Riley was targeted by Abramoff's influence peddling scheme. Riley, a Republican, won election in November 2002, and was reelected in 2006.

As Inflation Rises, Home Values Slump, Data Show

By VIKAS BAJAJ

Two worrisome trends for the economy — falling house prices and the rising cost of everything else — picked up speed in data reported on Tuesday, putting policy makers in an increasingly tough position.

If they move too aggressively to cut interest rates and stimulate the economy, they might stoke inflation at a time when consumers are already squeezed by higher prices for food, energy, clothing and other goods. But if they chose more austere measures, the economy may weaken substantially faster.

Bush: Clueless and Happy

By Dan Froomkin
Special to washingtonpost.com
Tuesday, February 26, 2008; 1:16 PM

President Bush last night delivered a buoyant campaign-style address to the 2008 Republican Governors Association Gala, once again raising the question of whether he has any idea what a drag he'll be on the Republican ticket.

Bush told big party donors that he is optimistic about the GOP's prospects -- as well as the verdict of history. "I don't know about you," he said, "but I'm confident we'll hold the White House in 2008. . .

"Our ideas are those embraced by the American people. American people want strong national defense and they want the government to protect the people from further attack, and that's precisely what Republicans will give them. Americans want lower taxes and less government, and it's precisely what Republicans will give them. Americans want strong, principled leadership, and that is precisely what Republicans will give them.

Panetta's Lament: They Had No Plan

The argument that the constant carping about Hillary Clinton’s campaign has been a function of an Obama-friendly, process-obsessed media is well and good. But how, then, to explain the deeply held dissatisfaction of an old Clinton loyalist like Leon Panetta?

In an interview with The Observer, Mr. Panetta compared Mrs. Clinton’s top strategist, Mark Penn, to Karl Rove, suggested that the Clinton campaign had totally underestimated Barack Obama’s appeal, and complained about the overall lack of planning that he said had characterized the former First Lady’s bid to return to the White House.

Banks Lose to Deadbeat Homeowners as Loans Sold in Bonds Vanish

Feb. 22 (Bloomberg) -- Joe Lents hasn't made a payment on his $1.5 million mortgage since 2002.

That's when Washington Mutual Inc. first tried to foreclose on his home in Boca Raton, Florida. The Seattle-based lender failed to prove that it owned Lents's mortgage note and dropped attempts to take his house. Subsequent efforts to foreclose have stalled because no one has produced the paperwork.

Confidence plunges, inflation rate soars

By MARTIN CRUTSINGER, AP Economics Writer
Tue Feb 26, 3:59 PM ET

In more bad economic news, consumer confidence and home prices posted sharp declines while higher costs for such basics as food and energy left wholesale inflation rising at the fastest pace in a quarter-century.

The new reports Tuesday raised the threat of a return of "stagflation," the economic curse of the 1970s in which economic growth stagnates at the same time that inflation continues racing ahead.

The 1 percent January jump in wholesale prices was led by a surge in the prices of energy, food and prescription drugs and followed a report last week that consumer prices had risen by a bigger-than-expected 0.4 percent because of price pressures in the same areas.

US foreclosures up 57% in January

The number of homes facing foreclosure in the US rose 57% in January compared with the same month of 2007.

Exactly 233,001 homes received at least one notice about overdue payments last month, compared with 148,425 in January 2007, US property site RealtyTrac said.

There was a 90% increase in the number of houses being repossessed by banks compared with January 2007.

Afghanistan: The Brutal and Unnecessary War the Media Aren't Telling You About

By Joshua Holland, AlterNet
Posted on February 26, 2008, Printed on February 26, 2008
http://www.alternet.org/story/77500/

They say journalists provide the first draft of history. With the U.S.-led invasion of Afghanistan, that draft led to an almost universal consensus, at least among Americans, that the attack was a justifiable act of self-defense. The Afghanistan action is commonly viewed as a "clean" conflict as well -- a war prosecuted with minimal loss of life, and one that didn't bring the kind of international opprobrium onto the United States that the invasion of Iraq would lead to a year later.

Those views are also held by many Americans who are critical of the excesses of the Bush administration's "War on Terror." But there's a disconnect there. Everything that followed -- secret detentions, torture, the invasion of Iraq, the assault on domestic dissent -- flowed inevitably from the failure to challenge Bush's claim that an act of terror required a military response. The United States has a rich history of abandoning its purported liberal values during times of war, and it was our acceptance of Bush's war narrative that led to the abuses that have shattered America's moral standing before the world.

US in Recession, Set to Worsen, Says Investor Rogers

The United States economy is already in recession and is set for a further slowdown with the dollar expected to remain under pressure, investment guru Jim Rogers said on Monday.

Last week the U.S. central bank sharply lowered its forecast for U.S. economic growth in 2008 and said it was worried the economy could face further setbacks even after a series of aggressive interest rate cuts.

"The U.S. is in recession," Rogers told reporters on a visit to Dublin. "It is going to get worse."

Texas School Board Showdown

The religious right has long coveted control of the Texas State Board of Education. There are many reasons, but one of them is the disproportionate influence of Texas in purchasing textbooks. For decades, Texas-based religious right activists have wielded national influence in because of the sheer purchasing power of the Texas schools. The state board has say over what books will be approved for use in the state's public schools, and the religious right has been a powerful lobby. Now, however, the religious right is within striking distance of outright control of the 15 member board.

The Scandal That Nearly Destroyed John McCain

By Stephen Pizzo, News for Real
Posted on February 25, 2008, Printed on February 25, 2008
http://www.alternet.org/story/77662/

Way back in 1988 my co-authors and I were putting the final touches to our book, Inside Job: The Looting of America's Savings and Loans when someone slipped us a plain brown envelop. Inside was a transcript of a meeting between thrift regulators and five US senators who had interceded on behalf of Arizona S&L owner Charles Keating. At the time the regulators were warning that Keating's thrift, Lincoln Savings and Loan, was dangerously insolvent and that Keating and his cohorts -- including then junk bond king, Mike Milken, were robbing the federally-insured thrift blind -- or, more precisely, robbing the US taxpayers blind.

Keating had been generous in sharing his new-found wealth with the five senators, particularly his two Arizona senators, John McCain and Dennis DeConcini. They became known as "The Keating Five."

The Three Trillion Dollar War

By Joseph Stiglitz and Linda Bilmes, The Times of London UK
Posted on February 25, 2008, Printed on February 25, 2008
http://www.alternet.org/story/77663/

The Bush Administration was wrong about the benefits of the war and it was wrong about the costs of the war. The president and his advisers expected a quick, inexpensive conflict. Instead, we have a war that is costing more than anyone could have imagined.

The cost of direct US military operations -- not even including long-term costs such as taking care of wounded veterans -- already exceeds the cost of the 12-year war in Vietnam and is more than double the cost of the Korean War.

Greenway: Echoes of 'Nam

Forty years ago this week, as twilight fell over the Republic of South Vietnam, I was lying on a stretcher in the rain outside a military hospital on a base near Hue. There were so many casualties that day that we had to wait our turn for overworked and overwhelmed doctors to attend to us.

The surgeon who eventually operated on me was furious - furious that he had been told to treat Americans first, leaving our South Vietnamese allies out in the rain.

It was the Tet Offensive, the turning point in the war. For it was Tet that brought the United States to sue for peace, and President Lyndon B. Johnson to give up running for another term. Negotiations dragged on and on, and seven years later it was all over.

Frank Rich: The Audacity of Hopelessness

WHEN people one day look back at the remarkable implosion of the Hillary Clinton campaign, they may notice that it both began and ended in the long dark shadow of Iraq.

It’s not just that her candidacy’s central premise — the priceless value of “experience” — was fatally poisoned from the start by her still ill-explained vote to authorize the fiasco. Senator Clinton then compounded that 2002 misjudgment by pursuing a 2008 campaign strategy that uncannily mimicked the disastrous Bush Iraq war plan. After promising a cakewalk to the nomination — “It will be me,” Mrs. Clinton told Katie Couric in November — she was routed by an insurgency.