Randy Wray: The Greatest Myth Propagated About The FED: Central Bank Independence (Part 3)

Posted on January 12, 2014 by Lambert Strether
 
By L. Randall Wray, Professor of Economics at the University of Missouri-Kansas City, Research Director with the Center for Full Employment and Price Stability and Senior Research Scholar at The Levy Economics Institute. Originally posted at New Economic Perspectives

Coda: Is the Fed Independent of Influence?

In my two part series (here and here), I examined conventional views of (mostly) economists on the Fed’s supposed independence. What they focus on is the Fed’s independence from our elected representatives and as well on operational independence of the Treasury. The reason why they believe this is important is because the Fed is supposed to protect us—we can identify us as “money users”—from the danger that the “government” (Congress and Treasury), our “money issuers”, might conspire to degrade our currency by having the Fed “print money” to finance a profligate government. These “Weimar Worriers” are just certain that if a cabal of central bank, treasury and congress had their way, we’d be off and running to hyperinflation. Hence, thank god that our central bank is independent! Any meddling by Congress (or the Treasury) in the affairs of monetary policy making would be the final death knell for our Dollar.

Brian Beutler: GOP’s next moral disgrace?: How right-wing crazies may kill a voting rights fix

With a new vote to expand the Voting Rights Act looming, we're about to learn just how cynical this party really is

The 2012 elections were supposed to create the political space Republicans needed to make their agenda more welcoming to growing Democratic constituencies, but instead it pushed conservatives into a deeper defensive crouch, from which they intimidated GOP leaders into squandering just about every opportunity they’ve had to broaden the party’s appeal.

In some cases, GOP leaders themselves have been reluctant to support the kinds of social and economic policies that might stanch the demographic bleeding that threatens to cost them the White House for another four or eight years.

Governments warned: Robots may take half our jobs in 20 years, so prepare for revolution

By Travis Gettys
Friday, January 17, 2014 10:44 EST

Nearly half of today’s jobs could be automated within the next two decades, according to one recent study, and no one seems to be prepared for what that will mean for society.

The digital revolution, just as the industrial revolution before it, is increasing productivity but also transforming the workforce – putting workers out of some jobs and into others.

That’s not necessarily a bad thing, as many of the newly created jobs are higher-paying or less physically demanding, but rapidly changing economies dislocates many workers and transforms societies in unpredictable ways.

The TPP – The More We Know, The Worse It Gets.

We already knew that the Trans Pacific Partnership is a threat to our jobs, our civil rights, and our national sovereignty, and now we know it’s also a danger to our environment.  On Wednesday, Wikileaks published a leaked version of the environmental chapter of the TPP, and it’s just another example of putting corporate power ahead of public interest.  In their review of this chapter, Wikileaks said that the section is “a toothless public relations exercise” that lacks “mandated clauses or meaningful enforcement measures.”

Because mega-corporations took part in negotiating the deal, the purpose of environmental chapter is first and foremost to protect trade, not our environment.  It relies on so-called corporate accountability, and emphasizes “flexible, voluntary mechanisms, such as voluntary auditing and reporting, market-based incentives, voluntary sharing of information and expertise.”  Because – you know – corporate self-regulation has worked out so well for us in the past.  This chapter does nothing to mandate that our environment is protected from the destructive nature of corporate greed, and nothing to punish trading partners or corporations who violate environmental standards.

The Special Ops Surge: America's Secret War in 134 Countries

Thursday, 16 January 2014 10:38  
By Nick Turse, TomDispatch | News Analysis 

They operate in the green glow of night vision in Southwest Asia and stalk through the jungles of South America.  They snatch men from their homes in the Maghreb and shoot it out with heavily armed militants in the Horn of Africa.  They feel the salty spray while skimming over the tops of waves from the turquoise Caribbean to the deep blue Pacific.  They conduct missions in the oppressive heat of Middle Eastern deserts and the deep freeze of Scandinavia.  All over the planet, the Obama administration is waging a secret war whose full extent has never been fully revealed -- until now.

Since September 11, 2001, U.S. Special Operations forces have grown in every conceivable way, from their numbers to their budget.  Most telling, however, has been the exponential rise in special ops deployments globally.  This presence -- now, in nearly 70% of the world’s nations -- provides new evidence of the size and scope of a secret war being waged from Latin America to the backlands of Afghanistan, from training missions with African allies to information operations launched in cyberspace.

Researchers find method to store solar power

By JAY PRICE

The News & Observer (Raleigh, N.C.) January 15, 2014 

CHAPEL HILL, N.C — A team of North Carolina researchers has discovered a potential solution to one of the fundamental problems of generating large amounts of energy from the sun's rays: how to store some of the power so it's available at night.

The scientists found a new way to use solar energy to split molecules of water into its atomic-level components: oxygen and hydrogen. The hydrogen can then be burned for fuel, generating only water as waste, which can then be recycled to be split again.

The hydrogen could be created and used by infrastructure similar to generators and solar arrays that are already familiar, said Tom Meyer, who led the research and is director of the federally funded Energy Frontier Research Center at the University of North Carolina-Chapel Hill.

Read more here: http://www.mcclatchydc.com/2014/01/15/214616/researchers-find-method-to-store.html#storylink=cpy

Richard Eskow: For the GOP, An Abyss Instead of Genuine Economic Ideas

When you look too long into the Abyss, said Nietzsche, the Abyss looks into you. “And,” adds comedian Brother Theodore, “neither one of us likes what we see.”

That’s what the economic pronouncements of Republican politicians are like nowadays. Instead of a governing philosophy, all one sees is a yawning intellectual abyss. Their core ideas are so unpopular and discredited that party leaders only express them in passing. But, without them, the party is reduced to a set of rhetorical and ideological tics in search of a host organism.

New Memo: Kissinger Gave the "Green Light" for Argentina's Dirty War

By David Corn on Tue. January 14, 2014 12:23 PM PDT

Only a few months ago, Henry Kissinger was dancing with Stephen Colbert in a funny bit on the latter's Comedy Central show. But for years, the former secretary of state has sidestepped judgment for his complicity in horrific human rights abuses abroad, and a new memo has emerged that provides clear evidence that in 1976 Kissinger gave Argentina's neo-fascist military junta the "green light" for the dirty war it was conducting against civilian and militant leftists that resulted in the disappearance—that is, deaths—of an estimated 30,000 people.

The Net Neutrality Court Case Decoded

Tuesday's court ruling on Verizon v. FCC closed the door on the first era of the Internet. Below, we break down the details and answer the burning questions on everyone's mind. Read on to find out more about the case, what happened to Net Neutrality and where we go from here.

What just happened?

On Jan. 14, 2014, the U.S. Court of Appeals for the D.C. Circuit struck down the Federal Communications Commission’s Open Internet Order in the case of Verizon v. FCC.

Translation: This court just killed Net Neutrality.

Internet service providers are now able to block any website or app they want. That means they can decide what you can do and where you can go online.

The Real Reason Evangelical Christians Are Trying to Thwart Women's Right to Birth Control

By Rob Shryock

January 14, 2014  |  On July 19, 2011, a report released by the U.S. Department of Health and Human Services recommended that all American women be provided with free contraception. Catholic charities were immediately in an uproar, knowing that this would like result in a provision for free contraception as part of the recently-passed Affordable Care Act.

 

In addition to Catholic institutions, evangelical organizations were also sounding the alarm bells. “Yet another untruth about Obamacare has been uncovered,” said Richard Land, head of the Southern Baptist Ethics & Religious Liberty Commission, on July 20. “HHS Secretary Kathleen Sebelius has recommended mandatory coverage for ‘emergency contraception,’ which is a euphemism for the morning-after pill, which often kills a newly conceived child by not allowing the embryo to implant on the wall of the mother’s womb.”

Land’s strong words mark the first major evangelical objection to the contraception mandate.

Leaked TPP 'Environment Chapter' Shows 'Corporate Agenda Wins'

US called main 'outlier' when it comes to strong protections; Leak comes as Obama tries to ram trade deal through Congress

- Jon Queally, staff writer

Confirming the suspicions and fears of environmental campaigners and concerned individuals across the globe, Wikileaks on Wednesday released a draft version of the 'Environment Chapter' from the Trans-Pacific Partnership (TPP), exposing most of the so-called "environmental protections" as toothless policies that serve to protect corporate profit not Mother Earth.

In its review of the chapter—which covers environmental issues related to trade, including climate change, biodiversity and fishing stocks; and trade and investment in 'environmental' goods and services—Wikileaks described the chapter as functioning like "a public relations exercise" and saying the text is most notable "for its absence of mandated clauses or meaningful enforcement measures."

Net Neutrality Takes a Big Hit in Court

—By Kevin Drum  | Tue Jan. 14, 2014 8:37 AM GMT

The long, grinding fight over net neutrality—the principle that everyone should have equal access to the internet—hit another speed bump today. But first, some background. Net neutrality was the de facto status quo until several years ago, when the Bush-era FCC decided to classify internet provision as an information service (IS) rather than a telecom service (TS). This mattered because telecom services had always been regulated as common carriers, which effectively required internet providers to treat everyone equally. Under the IS regime, the old common carrier requirements were replaced by four net neutrality "principles" that were considerably less stringent.

Paul Krugman: Scandinavian Struggles: Why So Dismal in Denmark?

I'm going to be visiting Scandinavia soon, so I'm doing preliminary homework - and for those who, like me, haven't been following the region closely, there have been some surprising developments. See the chart on this page on real gross domestic product, with the United States included to give some sense of comparison.

Barbara Ehrenreich: It Is Expensive to Be Poor

Minimum-wage jobs are physically demanding, have unpredictable schedules, and pay so meagerly that workers can't save up enough to move on.

Fifty years ago, President Lyndon B. Johnson made a move that was unprecedented at the time and remains unmatched by succeeding administrations. He announced a War on Poverty, saying that its “chief weapons” would be “better schools, and better health, and better homes, and better training, and better job opportunities.”

So starting in 1964 and for almost a decade, the federal government poured at least some of its resources in the direction they should have been going all along: toward those who were most in need. Longstanding programs like Head Start, Legal Services, and the Job Corps were created. Medicaid was established. Poverty among seniors was significantly reduced by improvements in Social Security.

The Case for Low Methane-Emitting Cattle

Jan. 10, 2014 — A new research project looks into the possibilities of adapting every aspect of cattle husbandry and selection processes to lower their greenhouse gas emissions.

You may think that climate change is being caused by burning oil, coal and gas. But not so fast! The emission of methane from cattle is a surprisingly important factor. Methane from cows -- a greenhouse gas 25 times more powerful than carbon dioxide -- makes up 20% of greenhouse emissions from agriculture, or about 1% of all anthropogenic greenhouse gases. That's according to Phil Garnsworthy, professor of dairy science at the University of Nottingham in the UK. He is also one of the project scientists of an EU-funded research project, called Ruminomics, which is using cutting-edge science to reduce greenhouse gas emissions from cattle.

No, we don't spend $1 trillion on welfare each year

By Mike Konczal, Updated: January 12 at 11:41 am

If you’ve read any conservative commentary on the war on poverty in the past week, you’ve likely seen this talking point: “We spend $1 trillion each year on welfare and there’s been no reduction in poverty.” That’s crazy! Then, a sentence later, you’ll probably see a line like this: “It’s true. According to a recent report, we spend a trillion dollars on means-test programs each year, yet the official census numbers show no reduction in poverty.”

If you are reading that second line quickly, you probably think it bolsters the credibility of the first line. It’s an “official” number, and the census and the report probably quote accurate numbers too, night? They do, but the second sentence is actually used as an escape hatch to say something that isn’t true. We don’t spend anywhere near a trillion dollars on welfare unless you mangle the term “welfare” to be meaningless, and we do reduce poverty.

Paul Krugman: Republicans Obamacare Hypocrisy: A Mystery Solved

Ezra Klein, a columnist at The Washington Post, is puzzled (or at least says he is; I suspect he understands it perfectly) by Republican hypocrisy over health care. For many years the G.O.P. has advocated for things that are supposed to bring the magic of the marketplace and individual incentives to health care: higher deductibles to give people "skin in the game"; competition among private insurers via exchanges (competition that would include reducing costs by limiting networks); and, of course, for cuts in Medicare, the insurance program for older Americans.

Now the G.O.P. is complaining bitterly that some Affordable Health Care Act policies have high deductibles, that the law relies on the horror of insurance exchanges, that some networks are limited and that there will be cuts to Medicare.

Chris Hedges: The Trouble With Chris Christie

New Jersey Gov. Chris Christie has been Wall Street’s anointed son for the presidency. He is backed by the most ruthless and corrupt figures in New Jersey politics, including the New Jersey multimillionaire and hard-line Democratic boss George Norcross III. Among his other supporters are many hedge fund managers and corporate executives and some of the nation’s most retrograde billionaires, including the Koch brothers. The brewing scandal over the closing of traffic lanes on the George Washington Bridge apparently in retaliation for the Fort Lee mayor’s refusal to support the governor’s 2013 re-election is a window into how federal agencies and the security and surveillance apparatus would be routinely employed in a Christie presidency to punish anyone who challenged this tiny cabal’s grip on power. 

Christie is the caricature of a Third World despot. He has a vicious temper, a propensity to bully and belittle those weaker than himself, an insatiable thirst for revenge against real or perceived enemies, and little respect for the law and, as recent events have made clear, for the truth. He is gripped by a bottomless hedonism that includes a demand for private jets, huge entourages, exclusive hotels and lavish meals. Wall Street and the security and surveillance apparatus want a real son of a bitch in power, someone with the moral compass of Al Capone, in order to ruthlessly silence and crush those of us who are working to overthrow the corporate state. They have had enough of what they perceive to be Barack Obama’s softness. Christie fits the profile and he is drooling for the opportunity.

The depressing psychological theory that explains Washington

By Ezra Klein, January 10 at 11:33 am

Dylan Matthews's "Five conservative reforms millennials should be fighting for" isn't just an admirably intricate piece of trolling. It's a perfect illustration of why you can't take Washington's policy debates at face value. You can't understand what's happened to Congress in recent years if you don't understand what Matthews did in that piece.

A Point of View: Two cheers for human rights

When we hear reports of nightmarish atrocities being committed in Syria, it's easy to respond by thinking these horrors could be prevented if only the country had a government that respected human rights. We've come to believe rights are the answer to many of the world's ills. But rights aren't a cure for human conflict, and I think it's a mistake to treat them as an article of faith.

In an essay published in 1938, the novelist EM Forster gave two cheers for democracy: "One because it admits variety, and two because it permits criticism… Two cheers are quite enough," he wrote. "There is no occasion to give three." Forster thought that no political system - not even democracy - should be turned into an icon. What mattered, he thought, was that individuals should have the chance to live as best they can.

How Big Money Keeps Populism at Bay

By Thomas Ferguson, Paul Jorgensen, Jie Chen

January 8, 2014  |  Did the ball that dropped in Times Square at midnight on January 1 really signal a new political era?

 

Headlines in the major media proclaim that a wave of “populism” is building. Inequality and the minimum wage are suddenly front-burner [5] political issues. Cities like New York and Boston have just elected progressive mayors with strong ties to unions and are now being touted  as liberal laboratories [6] for testing the limits of the grudging free-market conservatism and neo-liberalism that have been the sun and moon of our political system for decades.

Even the atmosphere within the DC Beltway is subtly altering. The steady decline of the deficit [7] is turning the tables on the massively funded campaign to cut Social Security and Medicare. In December 2013, the corporate-oriented Democratic policy group Third Way launched a campaign in the Wall Street Journal [8] to smear Massachusetts Sen. Elizabeth Warren and other Democratic politicians who favor raising Social Security benefits. It backfired ignominiously.

Paul Krugman: Enemies of the Poor 

Suddenly it’s O.K., even mandatory, for politicians with national ambitions to talk about helping the poor. This is easy for Democrats, who can go back to being the party of F.D.R. and L.B.J. It’s much more difficult for Republicans, who are having a hard time shaking their reputation for reverse Robin-Hoodism, for being the party that takes from the poor and gives to the rich.

And the reason that reputation is so hard to shake is that it’s justified. It’s not much of an exaggeration to say that right now Republicans are doing all they can to hurt the poor, and they would have inflicted vast additional harm if they had won the 2012 election. Moreover, G.O.P. harshness toward the less fortunate isn’t just a matter of spite (although that’s part of it); it’s deeply rooted in the party’s ideology, which is why recent speeches by leading Republicans declaring that they do too care about the poor have been almost completely devoid of policy specifics.

Let’s start with the recent Republican track record.

How GOP Gerrymanders Away Democracy

January 10, 2014

Amid America’s demographic changes, Republicans have exploited every trick they can think of to stave off actual democracy, where every vote is respected and equal. One scheme has been to modernize the old practice of “gerrymandering,” as Beverly Bandler explains.

Beverly Bandler

In Election 2012, Democrats received 1.4 million more votes for the U.S. House of Representatives, yet Republicans won control of the House by a 234-to-201 margin. Thus, the second-biggest GOP majority in 60 years was not the will of American voters. It was gerrymandered.

Or, as Republican strategist Karl Rove has said, “He who controls redistricting can control Congress.”

Bob Menendez is a Problem

by BooMan
Thu Jan 9th, 2014 at 10:53:57 PM EST

Among elected officials from New Jersey, Governor Chris Christie is not the biggest asshole. That designation belongs to Sen. Bob Menendez, the chairman of the Senate Foreign Relations Committee, who is actively undermining the administration's foreign policy and making war much more likely with Iran. The White House is seething, and they want everyone to know it.

A Point of View: See No Evil

We'd like to think the financial crisis is safely in the past. The events of 2007-2008, when the world's banking system was on the brink of collapse, seemed like a once-in-a-century upheaval, and it's natural to imagine we've returned to some kind of normalcy. Disaster has been averted, and there may be some signs of recovery in the economy. But have we emerged onto a sunny upland of stability, or are we fooling ourselves? History suggests an upheaval on this scale isn't left behind so easily. Could it be that we know the crisis hasn't been resolved, but prefer not to think about the fact?

Former US secretary of defence Donald Rumsfeld's distinction between known unknowns and unknown unknowns has passed into everyday speech. It's not the things of which we know we're ignorant that we should worry about, he pointed out. It's the things we're unaware of not knowing that can really cause trouble. It's a useful reminder of the vastness of human ignorance. But might there not be another kind of unknown, which Rumsfeld didn't mention - one that consists of things we choose not to know?

Some Folks Say It's the Beginning of the End for the Christian Right -- Dream On, They're Getting More Powerful

By CJ Werleman

January 8, 2014  |  In the aftermath of the government shutdown, and the ongoing Republican Party internal civil war that followed, progressive media outlets have embraced the notion that the Christian Right is finally facing its demise. Nothing could be further from the truth.

The autopsy of the 2012 election produced a swarm of op-ed obituaries that either celebrated or foretold the political end times for the Christian Right. Jonathan Merritt, a columnist for the Atlantic, observed that the GOP’s electoral hammering in 2012 marked the end of evangelical dominance in U.S. politics. More recently, Steven Conn, a contributor for the Huffington Post, predicts the rise of Pope Francis will dissolve the glue holding the Christian Right together.

While these observations make for sound logic when examining national politics, they completely overlook the Christian Right’s state-by-state strategy.

Paul Krugman: The War Over Poverty

Fifty years have passed since Lyndon Johnson declared war on poverty. And a funny thing happened on the way to this anniversary. Suddenly, or so it seems, progressives have stopped apologizing for their efforts on behalf of the poor, and have started trumpeting them instead. And conservatives find themselves on the defensive.

It wasn’t supposed to be this way. For a long time, everyone knew — or, more accurately, “knew” — that the war on poverty had been an abject failure. And they knew why: It was the fault of the poor themselves. But what everyone knew wasn’t true, and the public seems to have caught on.

How the Corporate Class Is Using Teach For America to Turn K-12 Teaching Into a Temporary, Low-Paying Job

By Chad Sommer

January 7, 2014  |  When I joined Teach For America [3] in the spring of 2011 I had no idea that my belief in social and economic justice was about to be cynically exploited by the corporate class. As a former development manager for a nonprofit that serves low-income Chicago public school students, TFA’s claims that its corps members and alumni are helping lead an educational revolution [4]in low-income communities across the country spoke to me. Naively seduced by TFA’s do-gooder marketing pitch, I charged ahead on a mission to close the academic “achievement gap [5]” that TFA blames on incompetent (read unionized) teachers.

 

Today, having completed the two-year program and seeing how it operates from the inside, I’m convinced that TFA now serves as a critical component of the all-out-effort by corporate elites to privatize one of the last remaining public institutions of our country: our public schools.