Social Security Suicide Pact (or, The Folks Back Home on the Old Ant Farm)

By Richard Eskow

Created 07/02/2010 - 12:40am

Must Read:

An Economy for All

Democrats won the news cycle yesterday when they slammed John Boehner for calling the economic crisis an "ant." But winning a news cycle isn't the same as winning an election. A new poll shows that the President and his party risk political suicide if they join in the mad rush to cut Social Security, and a sleight-of-hand move by the House leadership today suggests they're considering it. Cutting benefits may seem clever in Washington, where policymakers sometimes toy with the economy as if it were an ant farm. But here in the ant tunnels where the rest of us live, it's terrible politics and worse policy.

It was Barack Obama, not John Boehner, who appointed Alan Simpson and Erskine Bowles to co-chair the "National Fiscal Commission on Responsibility and Reform." Simpson's a longtime Social Security antagonist who's called retired Americans "greedy geezers [1]" because they don't want their Social Security payments used to fund extravagant tax cuts and military spending. (A video of Simpson's misguided and angry rant [2]drew quite a bit of attention recently.) And Erskine Bowles cut a deal with Newt Gingrich that would have partially privatized Social Security in the 1990's if the Monica Lewinsky scandal hadn't derailed their plans. (He has also revealed what Dean Baker describes as a numerological fascination [3] with using arbitrary numbers as targets.)

By creating this Commission and appointing two commissioners whose views are so far outside the political mainstream, President Obama risks endangering his own future and his party's in pursuit of a misguided policy goal. And a breaking report from Firedoglake [4] indicates that the Commission's set of recommendations - should members agree on one - will be submitted to an up-or-down vote by a lame duck Congress after the November elections, provided that the Senate passes it first. That clattering sound you just heard was the sound of Democrats picking up hara-kiri knives en masse.

Pelosi forces vote on Deficit Commission recommendations

by Gaius Publius on 7/02/2010 08:24:00 PM

For those of you who may be laboring under the illusion that the whole entire political establishment is NOT going to savage Social Security under the protection of a Democratic president, Nancy Pelosi just proved you wrong.

On Thursday, the House took up the War Supplemental bill. Keep in mind that every vote in the House includes a vote on the Rule — this is the meta-bill that lays on top of the real bill and controls how debate is conducted — for example, how much time is allocated, what amendments are allowed — and also what happens if the underlying bill passes.

Organic farmers better at pest control, study says

by Tom Laskawy
1 Jul 2010 12:24 PM

Dovetailing nicely with Grist contributor and would-be farmer Steph Larsen’s account of her battle with the hated corn borer, a new study from Washington State University suggests organic growing techniques offer better pest control and larger plants.

But first, let’s be clear: The debate over the benefits of organic versus industrial agriculture is never-ending. No one study will convince everyone that one form of agriculture or another is superior.

Decline in Labor Force Leads to Drop in Unemployment

Friday 02 July 2010
by: Dean Baker | Center for Economic and Policy Research | Report

The June drop in hours suggests that hiring will slow further.

The Labor Department reported that 652,000 people left the labor force in June, causing the unemployment rate to edge down to 9.5 percent, even as the number of employed reportedly dropped by 301,000. The establishment survey showed a gain of 100,000 jobs, excluding the 225,000 Census workers who lost their jobs in June. The establishment survey also showed declines in both the length of the average workweek and the average hourly wage, providing further concerns about labor market weakness going forward.

The employment-to-population (EPOP) ratio fell to 58.5 percent, reversing gains from the prior three months; although this is still 0.3 percentage points above the low hit in December. This decline was concentrated among men who saw their EPOP fall by 0.3 percentage points, as their unemployment rate edged up from 9.8 to 9.9 percent. The EPOP for women was unchanged, with their unemployment rate falling from 8.1 percent to 7.8 percent.

It's Going to Take a While to Bring Wall St. Under Heel

By William Greider, The Nation
Posted on July 2, 2010, Printed on July 3, 2010
http://www.alternet.org/story/147415/

Hold the applause. The president would like us to celebrate his "Wall Street reform," but the legislation is misnamed. Barack Obama did not set out as president to reform Wall Street in fundamental ways but to restore it. Judging by the largest banks' booming stock prices and executive bonuses, he appears to have succeeded. The leading bankers expressed relief when they saw the reform package Congress cobbled together on June 25. Wall Street, loathed by citizens everywhere, dodged the bullet in Washington.

Congress followed Obama's path and rejected the sterner measures that promised to actually change things. As with healthcare reform, the White House, joined by the Treasury and the Federal Reserve, spent much of its energy opposing more aggressive ideas or bargaining small-bore compromises. The president kept a low profile, saving himself for the victory celebration.

Despite the defeat of real reform, progressives should not despair—the future looks much brighter than the headlines suggest.

Advocates Praise Obama's Immigration Speech, Urge Action

By Marcelo Ballve, New America Media
Posted on July 2, 2010, Printed on July 3, 2010
http://www.alternet.org/story/147418/

Editor's note: Below, Marcelo Ballvé reports that immigrants' rights activists received Barack Obama's immigration address warmly. You can also read David Bacon's piece about another group of activists who are sharply critical of the approach Obama endorsed here. Finally, you can read a complete transcript of Obama's remarks here.

President Obama's speech may be too little, too late on immigration. But few have said it better.

Obama's remarks at American University ahead of the July 4 holiday--his first major policy speech devoted solely to this issue--tried to reframe a debate that has grown more contentious than ever with the advent of Arizona's new legislative crackdown on illegal immigration, which will go into effect later this month.

The president compared the immigration system to the health care and financial messes. He said the immigration laws are broken and in need of a major overhaul.

Climategate Continues to Crumble

Posted by Bryan Walsh Thursday, July 1, 2010 at 8:00 pm

Score a win for climate science: Penn State University announced today that climate scientist Michael Mann had been cleared of all scientific misconduct charges stemming from the "climategate" emails that had been hacked from Britain's East Anglia University last fall. Here's the release from the folks at State College:

Penn State Professor Michael Mann has been cleared of any wrongdoing, according to a report of the investigation that was released today (July 1). Mann was under investigation for allegations of research impropriety that surfaced last year after thousands of stolen e-mails were published online. The e-mails were obtained from computer servers at the Climatic Research Unit (CRU) of the University of East Anglia in England, one of the main repositories of information about climate change.

The ABCs of Reform

How Washington blew its chance to bring real change to Wall Street.

By Eliot Spitzer
Posted Thursday, July 1, 2010, at 6:23 PM ET

---

Even acknowledging the truism that making laws is like making sausage, often leading any observer toward becoming a vegetarian, if not a vegan, some legislation stands out as especially unpleasant. With that in mind, what conclusions can we draw about the financial reregulation bill now making its way through Congress?

First, the bill does virtually nothing to confront the single greatest structural problem we face: the continued growth of too big to fail, or TBTF, institutions. Indeed, over the course of the crisis we have gone in the wrong direction, with the banking industry now more concentrated than it was several years ago. There is no reason to believe that this trend will change or that the federal guarantees of TBTF institutions will be withdrawn.

How the TeleCom Industry Plans to Take Over the Internet in Four Easy Steps

by CommonDreams.org

by Timothy Karr

Have you heard about the battle over the Internet?

It's a power grab that involves lawyers, lobbyists, unscrupulous legislators, phony front groups and the most powerful telecommunications companies in the world.

They've aligned themselves against the rest of us -- the millions of Americans who use the Internet every day, in increasingly inventive ways.

They've opened their wallets to Washington. It's an investment of hundreds of millions of dollars [1] and it's being made right now by AT&T, Comcast and Verizon -- the companies that provide broadband access to the vast majority of Americans.

These companies are chasing the ultimate payout: control, not just of the Internet wires that snake into our homes, but over the information that flows across those wires..

How Goldman Gambled on Starvation

Speculators set up a casino where the chips were the stomachs of millions. What does it say about our system that we can so casually inflict so much pain?

by Johann Hari

By now, you probably think your opinion of Goldman Sachs and its swarm of Wall Street allies has rock-bottomed at raw loathing. You're wrong. There's more. It turns out that the most destructive of all their recent acts has barely been discussed at all. Here's the rest. This is the story of how some of the richest people in the world - Goldman, Deutsche Bank, the traders at Merrill Lynch, and more - have caused the starvation of some of the poorest people in the world.

It starts with an apparent mystery. At the end of 2006, food prices across the world started to rise, suddenly and stratospherically. Within a year, the price of wheat had shot up by 80 per cent, maize by 90 per cent, rice by 320 per cent. In a global jolt of hunger, 200 million people - mostly children - couldn't afford to get food any more, and sank into malnutrition or starvation. There were riots in more than 30 countries, and at least one government was violently overthrown. Then, in spring 2008, prices just as mysteriously fell back to their previous level. Jean Ziegler, the UN Special Rapporteur on the Right to Food, calls it "a silent mass murder", entirely due to "man-made actions."

Washington's Odd Jobs Attitude

Why high unemployment is terrible for the economy.

By Daniel Gross
Posted Friday, July 2, 2010, at 10:15 AM ET

---

Last week, I argued that the Federal Reserve doesn't seem to care much about high unemployment. Apparently, very few other people in Washington do, either. That's one way of interpreting the events of the last week. Congress is adjourning without extending unemployment benefits, in large measure due to repeated Republican filibusters. On Thursday, President Obama gave a major address about … immigration reform. All this on the eve of a jobs report that showed the economy lost jobs in June, due largely to the loss of temporary census jobs.

The economy is now presenting a strange dichotomy. The corporate sector has returned to rude health, with improved balance sheets and tons of cash. It has helped lead the recovery. But without the mighty American consumer, who generates 70 percent of economic activity, participating to the fullest degree, the recovery will seem anemic. Without a healthy jobs market, the recession-shocked consumer won't spend.

And yet Washington's response seems to be a collective throwing-up of hands. There are a few things the government can do about persistent long-term unemployment. First, it can lessen the pain it causes by expanding the safety net, extending unemployment-insurance benefits so that the long-term unemployed have a source of cash to help them stay current on rent, mortgage, and credit card bills. Second, it can respond to persistent long-term unemployment by enacting policies aimed at creating and preserving jobs. These can take the form of summer jobs programs, enhanced public works programs, aid to strapped municipalities so they can avoid layoffs, and tax cuts and credits for investment and hiring.

Paul Krugman: Myths of Austerity

When I was young and naïve, I believed that important people took positions based on careful consideration of the options. Now I know better. Much of what Serious People believe rests on prejudices, not analysis. And these prejudices are subject to fads and fashions.

Which brings me to the subject of today’s column. For the last few months, I and others have watched, with amazement and horror, the emergence of a consensus in policy circles in favor of immediate fiscal austerity. That is, somehow it has become conventional wisdom that now is the time to slash spending, despite the fact that the world’s major economies remain deeply depressed.

This conventional wisdom isn’t based on either evidence or careful analysis. Instead, it rests on what we might charitably call sheer speculation, and less charitably call figments of the policy elite’s imagination — specifically, on belief in what I’ve come to think of as the invisible bond vigilante and the confidence fairy.

Solar lamp wins award for helping developing countries

The developers of a solar lamp that aims to replace kerosene-burning lights in developing countries have won a prestigious environmental award.

D Light Design says its lanterns, which sell for around $10 (£7), contribute to the reduction of carbon emissions.

One of the runners-up for the Ashden Award for Sustainable Energy was the Rural Energy Foundation (REF) for promoting solar energy in Africa.

More than 70% of sub-Saharan Africa has no access to electricity.

Rethinking Iran-Contra

y Robert Parry
July 1, 2010

The conventional view of the Iran-Contra scandal is that it covered the period 1985-86, when President Ronald Reagan became concerned about the fate of American hostages in Lebanon and agreed to secretly sell weapons to Iran’s Islamist government to gain its help in freeing the captives.

Supposedly, the scheme went awry when White House aide Oliver North and other participants got carried away, including North’s decision to divert profits from the arms sales to another one of Reagan’s priorities, the Nicaraguan contra rebels whose CIA assistance had been cut off by Congress.

The Iran-Contra scandal was exposed in fall of 1986 after the shooting down of a North supply plane over Nicaragua and revelations in Lebanon of Reagan’s arms sales to Iran. A White House staff shake-up, including North’s firing, and some wrist-slaps from Congress for Reagan’s alleged inattention to details resolved the scandal, at least that was how Official Washington saw it.

The few dissenters who wouldn’t accept that tidy conclusion – such as Iran-Contra special prosecutor Lawrence Walsh – were mocked and marginalized by the news media, including the Washington Post (which ran an article concluding that Walsh’s consistency in pursuing the scandal was “so un-Washington” and that he would depart as “a perceived loser”).

BP's Hole in the World: The Absurdity of the Fix-It Mentality

By Naomi Klein, The Nation
Posted on June 28, 2010, Printed on July 2, 2010
http://www.alternet.org/story/147348/

Everyone gathered for the town hall meeting had been repeatedly instructed to show civility to the gentlemen from BP and the federal government. These fine folks had made time in their busy schedules to come to a school gymnasium on a Tuesday night in Plaquemines Parish, Louisiana, one of many coastal communities where brown poison was slithering through the marshes, part of what has come to be described as the largest environmental disaster in US history.

"Speak to others the way you would want to be spoken to," the chair of the meeting pleaded one last time before opening the floor for questions.

The Tea Party Is Dangerous: Dispelling 7 Myths That Help Us Avoid Reality About the New Right-Wing Politics

By Adele M. Stan, AlterNet
Posted on June 23, 2010, Printed on July 2, 2010
http://www.alternet.org/story/147307/

Few things are more confounding to liberals and progressives than the rise of the Tea Party movement, and the media’s infatuation with it. Just as we breathed a sigh of relief with the election of Barack Obama as the nation’s 44th president, after eight disastrous years under the reign of Bush the Younger, in swept a furious wave of misanthropic pique.

Really, we shouldn’t have been surprised. Just as a recession hit of unprecedented force, yielding high unemployment, conservatives found themselves sidelined, Obama’s triumph coming on the heels of the Democrats’ congressional victories of 2006. That partisan change would have been enough to make conservatives ornery, but the cultural change represented by the nation’s first African-American president struck fear into the hearts of many -- especially after liberal San Franciscan Nancy Pelosi became the first woman to wield the gavel of the Speaker of the House.

Derivatives Reform Suffers Midnight Mangling

Submitted by Mary Bottari on June 25, 2010 - 11:48am.

The last day was a long one in the House-Senate conference committee on financial reform. The conferees had been at it since 9:00 a.m. and were rumpled and weary. Big bank lobbyists packed the conference room and trailed out into the hallways. As the clocked ticked into the wee hours, the chances for meaningful financial reform dimmed. At issue was the strong and controversial crack-down on derivatives trading authored by Senate Agriculture Committee Chair Blanche Lincoln (D-Arkansas).

Taxpayers Still Back Reckless Wall Street Trading

At about midnight, House Agriculture Chairman U.S. Representative Collin Peterson (D-Minnesota) offered an amendment to the Lincoln provision to require big banks to spin off (or push out) their derivatives desks into a separately capitalized affiliate. The Lincoln measure was geared toward ending taxpayer supports (FDIC insurance, Federal Reserve monies) for Wall Street gambling.

Governments Move to Cut Spending, in 1930s Echo

By DAVID LEONHARDT

The world’s rich countries are now conducting a dangerous experiment. They are repeating an economic policy out of the 1930s — starting to cut spending and raise taxes before a recovery is assured — and hoping today’s situation is different enough to assure a different outcome.

In effect, policy makers are betting that the private sector can make up for the withdrawal of stimulus over the next couple of years. If they’re right, they will have made a head start on closing their enormous budget deficits. If they’re wrong, they may set off a vicious new cycle, in which public spending cuts weaken the world economy and beget new private spending cuts.

On Tuesday, pessimism seemed the better bet. Stocks fell around the world, over worries about economic growth.

Longer term, though, it’s still impossible to know which prediction will turn out to be right. You can find good evidence to support either one.

The Political Path for Progressives in the Face of Rabid Right-Wing Resistance

By Robert L. Borosage, Campaign for America's Future
Posted on June 28, 2010, Printed on June 30, 2010
http://www.alternet.org/story/147361/

“Change don’t come easy.”

Barely more than a year in office, the Obama presidency seems besieged. The oil spill in the Gulf of Mexico, a worsening catastrophe, casts a haunting pall. A jobs bill, even when cribbed, is torpedoed by members of the president’s own party in Congress. Entrenched interests delay and dilute vital reforms. On the right, a furious reaction builds. Former Republican Speaker Newt Gingrich rallies conservatives against the “secular socialist Obama machine.” Pundits predict Republicans will benefit from their strategy of obstruction and make significant gains in the fall elections.

Will reaction block renewal? Will a politics of hate overcome the politics of hope? Will the Gulf oil disaster become a metaphor for government too incapacitated or too compromised to address the challenges we face?

A Financial Crisis, Not A Deficit Crisis

By James Galbraith

Created 06/30/2010 - 12:58pm

What caused the deficits and rising public debt? The answer comes in two parts: present deficits and projected future deficits.

Overwhelmingly, the present deficits are caused by the financial crisis. The financial crisis – the fall in asset (especially housing) values, and withdrawal of bank lending to business and households – has meant a sharp decline in economic activity, and therefore a sharp decrease in tax revenues and an increase in automatic payments for unemployment insurance and the like.

According to a new International Monetary Fund staff analysis, fully half of the large increase in budget deficits in major economies around the world is due to collapsing tax revenues, and a further large share to low (often negative) growth in relation to interest payments on existing debt. Less than 10 percent is due to increased discretionary public expenditure, as in stimulus packages.

What Is Goldman Sachs Thinking?

By Simon Johnson

The next financial boom seems likely to be centered on lending to emerging markets. Sam Finkelstein, head of emerging markets debt at Goldman Sachs Asset Management, summed up the prevailing market view – and no doubt talked up his own positions – with a prominent quote in Monday’s Financial Times (p.13, front of the Companies and Markets section):

“Debt-to-GDP ratios in the developed world are about double those in emerging markets and they’re growing. This makes emerging markets interesting because you’re pick up incremental spread [higher interest rates compared with developed world rates], and in return you’re actually taking less macroeconomic risk.”

This is a dangerous view for three reasons.

Financial Regulation

There is much to applaud in the financial regulatory reform bill announced last Friday by House and Senate negotiators. It would limit some of the riskiest activities of banks and regulate the multitrillion-dollar market in over-the-counter derivatives. It would give federal regulators the tools, if they need them, to shut failing large banks and financial firms instead of bailing them out.

In significant ways, the bill would also protect Americans directly. Consumers would be shielded from many forms of abusive and predatory lending, and investors could be empowered to influence corporate boards that have long been impervious to shareholder concerns.

The bill is a considerable accomplishment. It is the final version. Congress should pass it quickly.

At the same time — and in the months and years ahead — lawmakers must acknowledge the bill’s shortcomings and be prepared to take corrective action. Many of the bill’s provisions come with exceptions or exemptions that could, in practice, swallow the new rules.

Why Should We Trust the IMF?

The IMF is shouting about the need for austerity today, but it was strangely quiet during the build-up of the bubble that got us here

by Dean Baker

Is advice from the IMF better than advice from a drunk in the street? That is the question that people around the world should be asking as the International Monetary Fund dishes out its prescription for austerity. The IMF programme calls for cutbacks in government support for healthcare, pensions, and a wide range of other public services. It also calls for weakening labour market regulations that provide workers with job security.

These recommendations are being given in a context where the world economy is suffering from a massive shortfall of demand. In other words, tens of millions of people are unemployed right now because there is not enough spending to keep them employed. The IMF's programme is almost certain to reduce spending further leading to even larger shortfalls in demand and more unemployment.

Report: US warships stationed off Iranian coast

By Daniel Tencer
Sunday, June 27th, 2010 -- 4:22 pm

As unconfirmed reports of an imminent Israeli strike on Iran's nuclear facilities pick up steam in the Middle Eastern media, a US-based strategic intelligence company has released a chart showing US naval carriers massing near Iranian waters.

The chart, published by Stratfor and obtained by the Zero Hedge financial blog, shows that over the last few weeks a naval carrier -- the USS Harry S Truman -- has been positioned in the north Indian Ocean, not far from the Strait of Hormuz, which leads into the Persian Gulf. The carrier joins the USS Dwight D. Eisenhower, which was already located in the area. The chart is dated June 23, 2010.

In Praise of Bureaucrats

By Sara Robinson

Created 06/28/2010 - 5:56pm

Brad Johnson at The Wonk Room calls out the "Climate Peacocks" in Congress [1] who are ostentatiously shaking their tailfeathers in mock outrage over the very idea that the Environmental Protection Agency might actually act as agents of environmental protection:

Earlier this month, 47 senators — every Republican and six Democrats — voted for Sen. Lisa Murkowski’s (R-AK) resolution to overturn the Environmental Protection Agency’s scientific global warming endangerment finding, finalized after years of delay in following a Supreme Court mandate to obey the language of the Clean Air Act.

Twenty of Murkowski’s supporters claimed they voted to reject science in order to preserve the “balance of power” between the legislative and executive branch. They said that they had to overturn the EPA’s scientific finding because setting pollution limits should instead be the job of the elected members of Congress. Sen. Mike Enzi (R-WY) even said he voted for Murkowski to “ensure that Congress keeps its responsibility to establish our nation’s environmental regulations.”

Wall Street Congratulates Washington: A Job Well Done

Monday 28 June 2010

by: Dean Baker, t r u t h o u t | Op-Ed

New York Times columnist Thomas Friedman is well known for pretentious columns that consist of letters that he suggests some prominent person write. I licensed Friedman's literary tool in order to present the following letter from the Wall Street CEOs to the political leadership in Washington.

Dear Friends:

We want you know how much we value the support of the leadership of both political parties in your efforts to ensure that we did not suffer from the crisis that we ourselves created. As you recall, back in the fall of 2008, our banks were flat on their backs. If you had not rushed to our rescue with trillions of dollars in loans and guarantees from the Fed and the Treasury at a time where no sane investor would talk to us, most of us would be among the unemployed today. Instead, our banks are hugely profitable and we're happy to say that bonuses are again hitting record highs.

Sticking the Public With the Bill for the Bankers’ Crisis

by Naomi Klein

My city feels like a crime scene and the criminals are all melting into the night, fleeing the scene. No, I’m not talking about the kids in black who smashed windows and burned cop cars on Saturday.

I’m talking about the heads of state who, on Sunday night, smashed social safety nets and burned good jobs in the middle of a recession. Faced with the effects of a crisis created by the world's wealthiest and most privileged strata, they decided to stick the poorest and most vulnerable people in their countries with the bill.

Families are confused over health-care law's coverage for young adults

By N.C. Aizenman

Washington Post Staff Writer
Sunday, June 27, 2010

It is among the top early selling points of the health-care overhaul -- a new rule that has particular appeal for middle-class, middle-age voters: Young adults who lack health insurance will soon be able to remain on their parents' plans until age 26.

But although Obama administration officials note that the provision will help millions, the benefit is proving less immediate than many families expect.

Paul Krugman: The Third Depression

By PAUL KRUGMAN

Recessions are common; depressions are rare. As far as I can tell, there were only two eras in economic history that were widely described as “depressions” at the time: the years of deflation and instability that followed the Panic of 1873 and the years of mass unemployment that followed the financial crisis of 1929-31.

Neither the Long Depression of the 19th century nor the Great Depression of the 20th was an era of nonstop decline — on the contrary, both included periods when the economy grew. But these episodes of improvement were never enough to undo the damage from the initial slump, and were followed by relapses.

We are now, I fear, in the early stages of a third depression. It will probably look more like the Long Depression than the much more severe Great Depression. But the cost — to the world economy and, above all, to the millions of lives blighted by the absence of jobs — will nonetheless be immense.

Robert Byrd, Respected Voice of the Senate, Dies

By ADAM CLYMER

Robert C. Byrd served 51 years in the United States Senate, longer than anyone else in American history, and with his six years in the House of Representatives, he was the longest-serving member of Congress. But it was how he used that record tenure that made him a pillar of Capitol Hill — fighting, often with florid words, for the primacy of the legislative branch of government and building, always with canny political skills, a modern West Virginia with vast amounts of federal money.

He had become an institution within an institution, as President Obama suggested in a statement of tribute on Monday, hours after Senator Byrd died at the age of 92 in a hospital in Fairfax, Va. Mr. Byrd, his health failing in recent years, had been admitted there late last week, experiencing heat exhaustion and severe dehydration as temperatures in the Washington area approached 100 degrees.

“America has lost a voice of principle and reason,” the president said.

Wall Street Journal Rewrites History to Mislead Readers

by linuxguy

Sun Jun 27, 2010 at 10:02:52 AM PDT

The editorial The Keynesian Dead End provides a good example of how Rupert Murdoch's Wall Street Journal editorial board rewrites history to mislead its readers. They cannot accept the fact that Keynesian Economics Works and that Obama's American Recovery and Reinvestment Act of 2009 has prevented a second Great Depression. When the facts do not support their political position, the Wall Street Journal simply rewrites history or twists statistics to support their agenda.

The Wall Street Journal editorial board writes in The Keynesian Dead End:

Like many bad ideas, the current Keynesian revival began under George W. Bush.

Even the Wall Street Journal knows how toxic George W. Bush is, so they start by associating him with Keynesian.

JP Morgan Responds To Financial Reform: The Poison Pill Strategy

By Simon Johnson

While the financial reform negotiation process grinds to its meaningless conclusion, the real action lies elsewhere – in Jamie Dimon’s executive suite.

Dimon, the head of JP Morgan Chase, is apparently seeking to (a) become more global, (b) move further into emerging markets, and (c) become more like Citigroup.

This is terrific corporate strategy – and very dangerous for the rest of us.

Income Gaps Between Very Rich and Everyone Else More Than Tripled In Last Three Decades, New Data Show

By Arloc Sherman and Chad Stone

June 25, 2010

The gaps in after-tax income between the richest 1 percent of Americans and the middle and poorest fifths of the country more than tripled between 1979 and 2007 (the period for which these data are available), according to data the Congressional Budget Office (CBO) issued last week. Taken together with prior research, the new data suggest greater income concentration at the top of the income scale than at any time since 1928.

While the recession that began in December 2007 likely reduced the income of the wealthiest Americans substantially and may thereby shrink the income gap between rich and poor households, a similar development that occurred around the bursting of the dot.com bubble and the 2001 recession turned out to be just a speed bump. Incomes at the top more than made up the lost ground from 2003 to 2005.

Wall Street Front Group Celebrates Record Success Electing Radical Pro-Corporate, Pro-BP Candidates

Roll Call’s John McArdle reported this week that the radical Wall Street front group “Club for Growth” is “celebrating” a near perfect winning streak this election cycle so far, especially given the results in run-off elections last Tuesday. The Club is known for running hard-hitting attack ads, especially in Republican primaries, against candidates who would consider raising any form of taxes on the rich or have done anything to hold powerful corporations accountable. Noting the Club’s historic role of purging moderates from the GOP, Rep. Steve LaTourette (R-OH) is quoted in the article calling it the “Spanish Inquisition.”

World Leaders Agree on Timetable for Cutting Deficits

By SEWELL CHAN and JACKIE CALMES

TORONTO — Leaders of the world’s biggest economies agreed on Sunday on a timetable for cutting their deficits and halting the growth of their public debt, despite the Obama administration’s concern that reducing spending too quickly might set back the fragile global recovery.

The Group of 20 countries ended a two-day summit meeting here by endorsing a goal of cutting government deficits in half by 2013 and stabilizing the ratio of public debt to gross domestic product by 2016. Canada’s prime minister, Stephen Harper, had proposed the targets and received the backing of several European leaders.

But to assuage objections from the United States, Japan, India and some other G-20 countries, the timetable was couched as an expectation, rather than as a firm deadline, and a joint statement by the countries explicitly exempted Japan, which is heavily reliant on domestic borrowing, from the targets.

Frank Rich: The 36 Hours That Shook Washington

THE moment he pulled the trigger, there was near-universal agreement that President Obama had done the inevitable thing, the right thing and, best of all, the bold thing. But before we get carried away with relief and elation, let’s not forget what we saw in the tense 36 hours that fell between late Monday night, when word spread of Rolling Stone’s blockbuster article, and high noon Wednesday, when Obama MacArthured his general. That frenzied interlude revealed much about the state of Washington, the Afghanistan war and the Obama presidency — little of it cheering and none of it resolved by the ingenious replacement of Gen. Stanley McChrystal with Gen. David Petraeus, the only militarily and politically bullet-proof alternative.

What we saw was this: 1) Much of the Beltway establishment was blindsided by Michael Hastings’s scoop, an impressive feat of journalism by a Washington outsider who seemed to know more about what was going on in Washington than most insiders did; 2) Obama’s failure to fire McChrystal months ago for both his arrogance and incompetence was a grievous mistake that illuminates a wider management shortfall at the White House; 3) The present strategy has produced no progress in this nearly nine-year-old war, even as the monthly coalition body count has just reached a new high.

If we and the president don’t absorb these revelations and learn from them, the salutary effects of the drama’s denouement, however triumphant for Obama in the short run, will be for naught.