Stiglitz Says Ties to Wall Street Doom Bank Rescue

By Michael McKee and Matthew Benjamin

April 17 (Bloomberg) -- The Obama administration’s bank- rescue efforts will probably fail because the programs have been designed to help Wall Street rather than create a viable financial system, Nobel Prize-winning economist Joseph Stiglitz said.

“All the ingredients they have so far are weak, and there are several missing ingredients,” Stiglitz said in an interview yesterday. The people who designed the plans are “either in the pocket of the banks or they’re incompetent.”

Prelude to Disaster

Please excuse the late intervention. I stayed up last night to finish Lords of Finance and should say first that I recommend it.

This is not a polemical book and it is also not primarily a work of economics, though there is a huge amount of economic history in it. It is first of all the social history of a small, important and largely forgotten group: the central bankers of the early 20th century, in the four countries whose finances, empires and ambitions dominated the globe. No question that the cover image is well-chosen.

Time To Bring In Justice

By Simon Johnson - April 17, 2009, 6:30AM

I don't generally overreact to news (from the NYT this morning, on the AIG-Goldman connection that runs through Edward Liddy's stock ownership), but this has gone far enough.

Have we completely lost of sense of what is and is not a conflict of interest? Have we really built a system in which greed fully overshadows responsibility? Is it not time for a complete rethink of what constitutes acceptable executive behavior?

EPA Tells Congress: Cap Carbon, Or We'll Do It For You

By Bill Scher

Created 04/17/2009 - 2:36pm

Summary:

After Congress in 1990 gave the EPA the authority to regulate air pollution, after the Supreme Court in 2007 told Bush's EPA they couldn't ignore greenhouse gas pollution that causes global warming, and after a full review of the scientific evidence, the EPA announced that greenhouse gases "threaten the public health and welfare of current and future generations," [1] which means the EPA is obligated to act.

Teabagging & Fake Grassroots: Fury Over Conservative Con-Job Allegations

By Tana Ganeva, AlterNet
Posted on April 18, 2009, Printed on April 18, 2009
http://www.alternet.org/story/137255/

Last Wednesday, angry conservatives took to the streets to protest taxes by draping themselves in tea bags and wielding a variety of terrifying (some borderline racist) signs.

The so-called tea parties were packaged as an outpouring of populist rage. But, as many liberal writers delighted in pointing out (almost as much as they enjoyed making teabagging jokes), the ostensibly grassroots, spontanous demonstrations were in fact launched by the conservative advocacy group FreedomWorks, nurtured by Republican operatives, then blasted out through the Fox News propaganda machine.

Paranoid Right-Wingers See Obama's Volunteer Service Project as Sinister Plot to 'Re-Educate' Americans

By Alexander Zaitchik, AlterNet
Posted on April 18, 2009, Printed on April 18, 2009
http://www.alternet.org/story/136448/

The far right has seen the fresh face of fascism, and it looks like the civic-minded legislative love child of Sens. Ted Kennedy, D-Mass., and Orrin Hatch, R-Utah.

Most Americans applauded last month when the Senate voted across party lines to expand national-service opportunities. How could you not? The Serve America Act, which passed easily 78-20, invests $5 billion in volunteer corps focused on education, clean energy, health care and veteran issues. In a symbolic but meaningful gesture, the bill also designates Sept. 11 as a National Day of Service, thus expanding a post-9/11 concept of patriotism previously limited to dying in Iraq and shopping at JC Penny.

The mother of all cockfights

By Pepe Escobar
On one side, the most powerful man on Earth, who happens to carry a Muslim middle name. On the other, the largest tribal nation in the world, which happens to be Muslim. Welcome to the mother of all cockfights.

As it was leaked by government sources to the Pakistani daily The News, the success rate of the Barack Obama administration's "hell from above" Predator drone war over the Federally Administered Tribal Areas (FATA) is a mere 6%. Of "60 Predator strikes between January 14, 2006, and April 8, 2009, only 10 hit their targets, killing 14 wanted al-Qaeda leaders" but most of all "killing 687 innocent Pakistani civilians". All of them Pashtuns.

Maya nut changes lives while aiding the rain forest# Erika Vohman teaches women in Central America the value of their native Maya nut # Nutrient-rich

• Erika Vohman teaches women in Central America the value of their native Maya nut
• Nutrient-rich seed grows abundantly in rain forest but many are unaware of it
• With Vohman's help, communities have planted more than 800,000 trees

FLORES, Guatemala (CNN) -- In the rain forests of Central America grows the nutrient-rich Maya nut. The marble-sized seed can be prepared to taste like mashed potatoes, chocolate or coffee. To those who stumble upon the nuts on the ground, they're free for the taking.

The problem, however, is that many people living in areas where the Maya nut grows abundantly don't know about it.

Home › Blog Time to Deliver: No Turning Back, Part II

By Sara Robinson
Created 04/13/2009 - 5:52pm

Part I [2]of this short series, I talked about the three main scenarios that dominate progressive conversations about America's future:

1) Permanent Decline -- Due to Americans' native hyperindividualism, political apathy, and overweening willingness to accept personal blame for their country's failures, the corporatists finally succeed in turning the US into Indonesia. This time, we will not find the will to fight back (or, if we do, it will be too late). As a result, in a few years there will be no more middle class, no upward mobility, few remaining public institutions devoted to the common good, no health care, no education, and no hope of ever restoring American ideals or getting back to some semblance of the America we knew.

2) Reinvented Greatness -- Americans get over their deeply individualistic nature, come together, challenge and restrain the global corporatist order, and finally establish the social democracy that the Powers That Be -- corporate, military, media, conservative -- have denied to us since the 1950s. This happens in synergy with a move to energy and food self-sufficiency, the growth of a sustainable economy, a revival of participatory democracy, and a general renewal of American values that pulses new life into our institutions and assures us a much more stable future.

3) Happy Face -- Prop up the banks, keep people in their houses, and by and by everything will get back to "normal" (defined as "how it all was a few years ago.")

Thomas Frank: Here Come the Plastic Pitchforks

Our latest populism is vague on the issues.

Unless it rains today, thousands of average people will stand up across the land, declare their mad-as-hell-ness. Look for folks to holler for lower estate taxes and a replacement for Sarbanes-Oxley. They will put on three-cornered hats, wave "don't tread on me" flags, and imagine that they are channeling the spirit of Tom Paine as they do their part to ease the troubles of the economy's winners.

And Fox News, which plans to cover the tea parties, will no doubt hail this plastic populism as the realest kind of social uprising, a movement that is the rightful expression of this year's discontents.

Taxes, Widows, and Orphans

Conservative hypocrisy about Obama's proposal to limit charitable tax deductions for the rich.

By Daniel GrossPosted Wednesday, April 15, 2009, at 11:52 AM ET

Should we use the tax code to encourage virtuous behavior, such as, say, charitable giving? And should we avoid making changes in the tax code that would discourage charitable giving at this time of charitable stress? These questions would seem to be a matter of principle: It's either a good idea or a bad idea. But it all depends on how you're using the tax code. If the change involves a moderate tax hike on merely rich people, some think it's a bad idea that would be the equivalent of kicking widows and orphans in the face. But if the change is a massive tax cut for a few really, really rich people that would reduce charitable giving much more, the very same people think it's a great idea.

The great right-wing freak-out

Symptoms of the conservative crack-up were on full display after President Obama's trip abroad. Bill Kristol, take a bow.

By Juan Cole

April 13, 2009 | President Obama's recent trip to Europe, Turkey and Iraq was a fairly bland freshman outing in foreign affairs, notable for the enormous good will it generated toward the U.S., along with some practical achievements and a few minor errors. It lacked the drama of the untested young Kennedy grappling over Berlin with the wily old Khrushchev in Vienna in 1961. On the American right, however, Obama's trip produced a hysteria not seen since radio listeners mistook Orson Welles's 1938 radio production about an invasion from Mars for the real thing, and crowded the highways, heads wrapped in wet towels, to escape the poisonous miasma of the onrushing aliens. The weeping and trembling of Sean Hannity, Karl Rove, Rush Limbaugh and William Kristol underlined once again that the right-wingers are playground crybabies who kick and scream and faint whenever they do not get their way.

The peasant mentality lives on in America

It took a good long while for news of the Teabag movement to penetrate the periphery of my consciousness — I kept hearing things about it and dismissing them, sure that the whole business was some kind of joke. Like a Daily Show invention, say. It pains me to say this as an American, but we are the only people on earth dumb enough to use a nationwide campaign of “teabag parties” as a form of mass protest, in the middle of a real economic crisis.

Taxing grandma to pay Goldman Sachs

By Peter Morici

Goldman Sachs' report this week of much larger than expected first-quarter profits came hard on the heels of Wells Fargo's strong earnings. No one should be surprised.

The US Federal Reserve has provided the banks with lots of cheap funds through its various emergency lending facilities and quantitative easing. The Fed has permitted the banks and financial houses to park vast sums of unmarketable paper on its books - securities made nearly worthless by the misjudgment and avarice of bankers. In return, the Fed has provided these scions of finance with fresh funds, cheaply, that they may lend at healthy rates on credit cards, auto loans and even mortgages.

GOP lawmaker can only name 1 of 17 socialists he said were in Congress

An Alabama Republican lawmaker who declared last week that a gang of socialists are stalking the halls of Congress is apparently taking the Fifth.

Rep. Spencer Bachus (R-AL) told a gathering in Trussville, Ala. on Apr. 9 that there were 17 socialists in Congress. "Some of the men and women I work with in Congress are socialists," said Bachus, the top Republican on the Financial Services Committee.

World leaders miss the target

By Henry C K Liu

Leaders attending the Group of 20 second Summit on Financial Markets and the World Economy in London on April 2, echoing the first such gathering in Washington in November 2008, continued the tradition of superficial posturing for political theater on global television, while missing the real target - that is, the need not so much to revive dysfunctional trade that has collapsed from its own internal contradictions, but to redefine the predatory terms of international trade created by dollar hegemony.

Gilded Age Taxation

By Robert Borosage, Eric Lotke and Hillary Hampton
Institute for America's Future

April 13th, 2009

The problem isn’t taxes. The problem is who pays taxes and who gets the benefits.

The federal tax code becomes less fair every year. Thirty years ago, the tax code was broadly progressive, reflecting shared contributions to public investments and our common good. Loopholes were fewer and covered such items as home mortgages that everyone could understand and appreciate.

Paul Krugman: Tea Parties Forever

This is a column about Republicans — and I’m not sure I should even be writing it.

Today’s G.O.P. is, after all, very much a minority party. It retains some limited ability to obstruct the Democrats, but has no ability to make or even significantly shape policy.

Beyond that, Republicans have become embarrassing to watch. And it doesn’t feel right to make fun of crazy people. Better, perhaps, to focus on the real policy debates, which are all among Democrats.

Hemp Could Be Key To Zero-carbon Houses

ScienceDaily (Apr. 13, 2009) — Hemp, a plant from the cannabis family, could be used to build carbon-neutral homes of the future to help combat climate change and boost the rural economy, say researchers at the University of Bath.

A consortium, led by the BRE Centre for Innovative Construction Materials based at the University, has embarked on a unique housing project to develop the use of hemp-lime construction materials in the UK.

Krugman Calls Out GOP Hypocrisy On Job Creation And Defense Cuts

In February, only three Republican senators broke party ranks to vote for the economic recovery package. Zero House Republicans voted for passage. Part of their opposition centered around the belief that an increase in government spending would do nothing to create jobs:

– “And first off the government doesn’t create jobs. Let’s get this notion out of our heads that the government creates jobs. Not in the history of mankind has the government ever created a job. Small business owners do, small enterprises do. Not the government.” [RNC Chairman Michael Steele, 2/2/09]

After smearing Obama, media figures call him polarizing

Summary: Several conservative media figures who have repeatedly spread falsehoods and smears of President Obama are now highlighting a poll analysis to suggest that Obama has polarized approval ratings, and have made the disputed suggestion that Obama himself has caused that polarization.

Recently, several conservative media figures have cited an April 2 Pew Research Center poll analysis to suggest that a March 9-12 Pew Research poll found that President Obama "has the most polarized early job approval ratings of any president in the past four decades." Several of those media figures have also made the disputed suggestion that Obama has caused that polarization.

Plan to Change Student Lending Sets Up a Fight

By DAVID M. HERSZENHORN

WASHINGTON — The private student lending industry and its allies in Congress are maneuvering to thwart a plan by President Obama to end a subsidized loan program and redirect billions of dollars in bank profits to scholarships for needy students.

The plan is the main money-saving component of Mr. Obama’s education agenda, which includes a sweeping overhaul of financial aid programs. The Congressional Budget Office says replacing subsidized loans made by private banks with direct government lending would save $94 billion over the next decade, money that Mr. Obama would use to expand Pell grants for the poorest students.

Is Geithner's Game Up?

By Mike Whitney, CounterPunch
Posted on April 13, 2009, Printed on April 13, 2009
http://www.alternet.org/story/136306/

On Tuesday, a congressional panel headed by ex-Harvard law professor Elizabeth Warren released a report on Treasury Secretary Timothy Geithner's handling of the Troubled Assets Relief Program (TARP). Warren was appointed to lead the five-member Congressional Oversight Panel (COP) in November by Senate majority leader Harry Reid. From the opening paragraph on, the Warren report makes clear that Congress is frustrated with Geithner's so-called "Financial Rescue Plan" and doesn't have the foggiest idea of what he is trying to do. Here are the first few lines of "Assessing Treasury's Strategy: Six Months of TARP":

Spontaneous Uprising? Corporate Lobbyists Helping To Orchestrate Radical Anti-Obama Tea Party Protests

Yesterday, Think Progress reported on Republican lawmakers planning to speak at anti-Obama “tea party” protests taking place nationwide on April 15. Last night, Eric Odom of the DontGo website — one of the organizers of the protests — wrote a blog post stressing that these protests are displays of “regular American[s] in protest of government spending and extreme taxation,” rather than something affiliated with a political party or special interest agenda.

Today on Fox News — which has actively been promoting the protests — Glenn Beck pushed the tea party talking points, similarly claiming that the protests aren’t “coordinated” and are fully organized by “regular” people.

Digby: Shocked Disbelief

These bankers amaze me. In spite of everything, they continue to flex their muscles and insist that the taxpayers should hand over money with no strings attached and do things their way. Or else.

Remember when Alan Greenspan said this?

"Those of us who have looked to the self-interest of lending institutions to protect shareholder's equity -- myself especially -- are in a state of shocked disbelief."

Well, I wasn't that shocked, but I confess that I am a bit shocked by their current self-destructive narcissism. The executives of these lending institutions understand their own self-interest to be to do anything they damned well please and to hell with anyone who says otherwise and they are ready to take down the entire system if they don't get their way.

Digby: Mad As Hell

I just watched one of the most disturbing yet bizarrely entertaining shows I've ever seen on television. It's a Glenn Beck special called "Destined To Repeat(?)" featuring noted right wing intellectuals Jonah Goldberg, Amity Schlaes, and a couple of other fringy authors discussing the connections between Obama and Hitler, Stalin, Woodrow Wilson, FDR and other "progressive" dictators, illustrated throughout with black and white footage of Nazis and concentration camps.

It ended with a stirring speech by an actor dressed as Thomas Paine exclaiming that the American founders wouldn't have flown airplanes into buildings or passed the biggest spending program in history. And then he said to join the tea parties.

Rick Warren’s peeps start up the damage control machine - massive FAIL

Oh the joy of getting busted lying on international TV and having to do serious damage control. My post on Tuesday, ”Rick Warren lies about his homobigotry on Larry King Live,” was picked up by Huff Post and created a buzz for pointing out that on the man who delivered the invocation at the President’s inaugural, Rick Warren, the spiritual leader of Saddleback church, flat-out lied about his support for Prop 8. A recap from the CNN transcript...

I See You Typing

Spying on someone by hacking into his webcam is disturbingly easy. Why don't more people do it?

By Christopher BeamPosted Monday, April 6, 2009, at 5:09 PM ET

A webcamThe China-based cyber-spy network known as "GhostNet" is a sophisticated group of hackers capable of logging its victims' keystrokes, stealing their documents, capturing images from their screens—and staring creepily at them through their webcams.

Who’s manning the TARP desk?

Posted by Anupama, April 10th, 2009

Less than half a dozen people are responsible for making the final decisions about which banks get part of the $700 billion in bailout money available through the Troubled Asset Relief Program, according to Department of Treasury officials. In response to a Freedom of Information Act request made by the Sunlight Foundation in January for the members of the TARP Investment Committee, a FOIA officer recently responded with just four names, including Assistant Secretary, Neel Kashkari; Chief Investment Officer, James Lambright; Acting Assistant Secretary for Financial Markets, Karthik Ramanathan and Acting Assistant Secretary for Economic Policy, Ralph Monaco, all holdovers from the Bush administration.

CDC covered up high lead levels in D.C.

Eight years ago, engineers and officials in Washington, D.C. decided to give the go-ahead for a program that would eliminate the "potentially carcinogenic by-products" of chlorine in tap water. The program replaced chlorination with chloramination, and it worked. However, in the next three years, hundreds of families with homes fitted with lead pipes in the District of Columbia were exposed to dangerously high lead levels. Unknown to scientists at the time, the chlorine in tap water served as a 'binder' for the lead pipes, keeping a certain amount of lead from dissolving in the water. In 2004, the chlorination method was restored. Still, in the first half of that year, 74 out of 108 household taps sampled had lead concentrations above the "EPA action level," some astronomically so.

Learning to Love the Bailout

Among the criticisms of the Obama administration’s bank rescue proposal is that it’s a heads-I-win-tails-you-lose proposition, with Wall Street flipping the coin and taxpayers coming up tails.

Under the plan, which could be up and running in a matter of weeks, the government will provide up to $1 trillion in financing for big private investors, like the powerhouse asset manager BlackRock, to buy up banks’ bad assets. If those assets subsequently lose value, the investors do not have to repay the government loans, sticking taxpayers with potentially huge losses. If the assets make money, taxpayers get only half the profit.

KU professors found companies realized big tax savings by spending for lobbyists

Three professors at the University of Kansas say dozens of America’s largest companies got that sweet deal four years ago — not by hiring workers or purchasing new equipment, but by investing in Washington lobbyists.

Those lobbyists, the three said, helped write a federal tax break that eventually put roughly $100 billion in tax savings in the pockets of the firms and their shareholders, at a cost to the companies of just pennies on the dollar.

Frank Rich: Awake and Sing!

“I am pronouncing the depression over!” declared CNBC’s irrepressible Jim Cramer on April 2. The next day the unemployment rate, already at the highest level in 25 years, jumped yet again, but Cramer wasn’t thinking about the 663,000 jobs that disappeared in March. He was thinking about the market. Mad money. Fast money. Big money. The Dow, after all, has rallied in the weeks since Timothy Geithner announced his bank bailout 2.0. Par-tay! On Wednesday, Cramer rang the opening bell at the New York Stock Exchange, in celebration of the 1,000th broadcast of his nightly stock-tip jamboree.

Given Cramer’s track record on those tips, there’s no reason to believe he’s right this time. But for the sake of argument, let’s say he is. (And let’s hope he is.) The question then arises: What, if anything, have we learned from this decade’s man-made economic disaster? It wasn’t just trillions of dollars of wealth that went poof in the bubble. Certain American values also crumbled and vanished. Making quick killings by reckless gambling in the markets — rather than by investing long-term in new products, innovations, technologies or services that might grow and benefit America and the world — became the holy grail in the upper echelons of finance.