Ian Welsh explains how the right thing morally is usually also the best thing practically

This is so true, and the fact that it's commonly ignored is so sad...

The right thing to do

2010 August 25

by Ian Welsh

What makes me saddest of all things in the world is this: the vast majority of the time the right thing to do morally is the right thing to do in terms of broad self-interest, and yet we don’t believe that and we do the wrong thing, thinking we must, thinking that we’re making the “hard decisions”.

This spans the spectrum of issues. It doesn’t matter whether you’re talking about foreign affairs, where the money used on Iraq and Afghanistan could have rebuilt America and made it more prosperous. It doesn’t matter if you’re talking about health care, where everyone knew that the right thing to do was single payer or some other form of comprehensive healthcare, which would have reduced bankruptcies massively, saved 6% of GDP and massive numbers of lives. It doesn’t matter if you’re talking about the financial crisis, where criminally prosecuting those who engaged in fraud (the entire executive class of virtually ever major financial firm) and nationalizing the major banks, wiping out the shareholders and making the bondholders eat their losses was the right thing to do, and didn’t happen. It doesn’t matter if you’re talking about drug policy, where the “war on drugs” has accomplished nothing except destabilizing multiple countries and giving the US the largest prison population proportional to population in the entire world and where legalizing marijuana, soft opiates and coca leaves would save billions of dollars, reduce violence, help stabilize Mexico and would help tax receipts. It doesn’t matter if you’re talking about food, where we subsidize the most unhealthy foods possible and engage in practices which have reduced the nutritional content of food by 40% in the last half century. It doesn’t matter if you’re talking about environmental pollutants, which have contributed to a massive rise in chronic diseases so great it amounts to an epidemic.

And on, and on, and on.

Now the fact is that there is no free lunch. When you spend money on war, you can’t spend it on education or health or crumbling infrasture or civilian technology. When you allow oligopolies to control the marketplace and buy up politicians, the cost of that is a decreased standard of living. When you refuse to deal effective with externalized health pollution, whether from soda pop or carcinogens, you pay for that with the death of people you care for from heart disease, cancer and other illnesses.

The response is “we have to do this to protect ourselves/to make a profit”.

No, you don’t. America would be more prosperous and just as safe if you didn’t waste trillions on wars and a bloated military whose purpose isn’t to protect you but to beat on foreigners (who is going to invade the US? No one. Next.) You would be happier if you did not allow health pollution because you and your loved ones would be healthier and it’s damn hard to be happy when you or your loved ones get cancer, or diabetes, or asthma and so on. Cheap consumer goods do not make up for it and the costs are so high that it’s questionable that the consumer goods ARE cheap—you’re just paying for them in illness and health care bills.

All of these things are moral wrongs. We know it’s wrong to invade other countries that haven’t attacked us. We know that it’s wrong to put illness inducing substances into the air or food. We know that we shouldn’t subsidize high fructose corn syrup and that if we’re going to subsidize food we should subsidize healthy food. We know that’s immoral, yet we do it anyway.

One of the great ironies of human society is that we create it ourselves, but as individuals and even groups we feel powerless to control what we created. We forged our own chains, and can’t get out of them.

But the first step to freeing ourselves from our chains is to stop telling ourselves that the moral thing to do isn’t the right thing to do in practical terms. The right thing to do… is the right thing to do. When we refuse to do the right thing, instead we impoverish ourselves and our loved ones, we make ourselves sick and we kill ourselves. When we do horrible things to other people, we make them hate us, and then they try and do horrible things to us.

Doing the wrong thing, the immoral thing, is almost never the practical thing if you care about the well-being of yourself, your children, your friends and your family. It always blows back. If you’re lucky, you may die before the cost comes to bear, but that’s only if you’re lucky, and in the American context, if you aren’t dead yet, you probably aren’t going to get lucky.

So do the right thing. Not just because it is the right thing morally, but because it’s the right thing to do for you and your loved ones in a very practical way.

Leaner, Meaner Capitalism at Work

Mike Malloy was talking about this tonight.

A company gets new management, which decides to reward the 300 workers who enabled the company to go from a loss last year to a half billion dollar profit this year by docking them $1.50/hr, decimating their pension program, and generally behaving like greedy capitalist pigs. Three months later, the strike is still on, and the company is making more money than ever, thanks to strikebreaking scabs.

This is the first I've heard about it.

Here's the original story, from May of this year:

RWDSU.info:

Strike!: Mott's Wage Cuts Despite Huge Profits Forces Work Stoppage (5/23/10)

Over 300 full time manufacturing workers at the Mott’s plant in Williamson, New York, went out on strike this morning at 6 AM after company executives demanded painful wage cuts while the company enjoyed a record year of $550 million in profits. The work stoppage was caused as a direct result of the Mott’s (a subsidiary of Dr. Pepper Snapple Group) executives' unfair labor practices as they tried to peel away good jobs and wages, including not bargaining in good faith. The company had publicly declared an impasse and plans to implement their last contract terms, which offered nothing but a reduction in hourly wages and drastic healthcare and pension concessions for the skilled, dedicated workforce at the Williamson manufacturing plant.

“The workers that were forced to strike today are the same workers who helped make Mott’s the highly profitable company they are today, and they should not be treated like a bunch of rotten apples by overpaid executives,” said Stuart Appelbaum, president of the Retail, Wholesale and Department Store Union, UFCW. “We understand that no one wins when there is a strike, but is very troubling and disturbing that such a profitable company as Mott’s would carve away a core relationship with their workforce all for corporate greed. Whittling down wage and benefit standards, while exponentially increasing CEO compensation is rotten business, and frankly unAmerican!”

RWDSU Local 220, which represents the workers, has been tirelessly negotiating to secure a fair and decent contract for months with Mott’s management. Despite the company’s profitability, Mott’s/Dr. Pepper Snapple have demanded givebacks, including a $1.50 per hour wage cut for all employees, a pension elimination for future employees and a pension freeze for current employees, a 20 percent decrease in employer contributions to the 401K and increased employee contributions toward health care premiums and co-pays.

Mott’s workers overwhelmingly rejected this offer and voted in favor of authorizing their negotiating committee at RWDSU Local 220 to call an unfair labor practice strike. The union has continued to demand that the company bargain in good faith in order to quickly reach a fair contract.

By contrast, Dr. Pepper Snapple Group President & CEO Larry D. Young has enjoyed a 113 percent salary increase over the last 3 years (or 28 percent each year). In 2009, Young's total compensation was $6,519,378.

Michael Leberth, president of RWDSU Local 220 said “the company has not budged from our reasonable and dignified offer and there will be no late night negotiations. We are tired of being juiced by such a profitable company.”

May is the busiest season for Mott’s apple juice and applesauce manufacturing as the demand for these family favorites is highest during the summer season.

The Williamson plant is the only plant that produces Mott’s applesauce, including high margin single serve packs, with 70 percent of the workforce in skilled labor categories. A labor dispute could damage the value of Mott’s family-friendly brand by associating it with corporate greed and union busting. Additionally, the product may suffer quality issues, as the skilled workforce is not easily replaceable. The Mott’s brand is responsible for more than $550 million worth of Dr. Pepper Snapple’s retail sales each year.

“Why would DPS, with millions in profit, risk interrupting production at a high volume plant?” asked Ira Bristol, who has worked at the plant for almost five years. “Destroying goodwill and creating this antagonistic atmosphere will badly hurt the production system and bottom line, not to mention negatively affect employee morale and tarnish the Mott’s good brand around the country.”

Here's a thumbnail of Dr Pepper Snapple—

ABCnews.go.com:

Since being spun out of U.K. conglomerate Cadbury Schweppes two years ago at around $25 per share, DPS shares have risen to nearly $40, and have more than doubled off of March 2009 lows. Last year, the company, which produces 50 brands, including Mott's juice, namesake brands Dr Pepper and Snapple, as well as 7-Up, Hawaiian Punch, A&W root beer and others, recorded $555 million in profits on more than $1 billion in revenues.

Here's where we're at now...

New York Times:

By STEVEN GREENHOUSE
Published: August 17, 2010

WILLIAMSON, N.Y. — After nearly 90 days of picketing in the broiling sun outside the sprawling Mott’s apple juice plant here in upstate New York, Michelle Muoio recognizes that the lengthy strike is about far more than whether the 305 hourly workers at the plant get a fatter or slimmer paycheck.

The union movement and many outsiders view the strike as a high-stakes confrontation between a company that wants to cut its labor costs, even as it is earning record profits, and workers who are determined to resist demands for wage and benefit givebacks.

“It’s disgusting, honestly, that they want to take things away from the people who made them profitable,” said Ms. Muoio (pronounced MOY-oh), a $19-an-hour machine operator who has worked at the plant 15 years.

The company that owns Mott’s, the beverage conglomerate Dr Pepper Snapple Group, counters that the Mott’s workers are overpaid compared with other production workers in the Rochester area, where blue-collar unemployment is high after years of layoffs at employers like Xerox and Kodak.

Chris Barnes, a company spokesman, said Dr Pepper Snapple was seeking a $1.50-an-hour wage cut, a pension freeze and other concessions to bring the plant’s costs in line with “local and industry standards.”

The company, which has 50 brands including 7Up and Hawaiian Punch, reported net income of $555 million in 2009, compared with a loss of $312 million the previous year. Its 2009 sales were $5.5 billion, down 3 percent.

With each passing week, the two sides have dug in deeper, doing their utmost to outmaneuver and undercut each other. Rain or shine, dozens of workers picket outside the plant each day, standing alongside a 15-foot-tall inflatable rat and a mock coffin emblazoned with “R.I.P. Corporate Greed.”

Rebecca Givan, a professor of industrial relations at Cornell, said the strike has taken on broader symbolism. “The union wants to tap into the public backlash against perceived corporate greed,” she said. “The company wants to emphasize the depressed local labor market.”

The strike has become so important because of the prominence of the brands and because of its unusual nature: a highly profitable company is taking the rare and bold step of demanding large-scale concessions.

Unlike previous battles, where American manufacturers have often sought to cut labor costs by threatening to close plants or move operations to the South or overseas, Dr Pepper Snapple is not making such threats.

For unions across the country, the stakes are high because if the Mott’s workers lose this showdown, it could prompt other profitable companies to push for major labor concessions. Such a lengthy strike is unusual at a time when work stoppages have become much less common than they once were.

Strikes and other work stoppages nationwide have plunged in recent decades, to 126 last year from 831 in 1990, according to the Bureau of National Affairs, as unions represent fewer workplaces and workers increasingly recognize the considerable pain and risk involved in walkouts.

“Companies have asked for concessions throughout the history of the labor movement because they’ve faced hard times and needed help to survive,” said Stuart Appelbaum, president of the Retail, Wholesale and Department Store Union, which represents the Mott’s workers. “Dr Pepper Snapple is different. They don’t even show the respect to lie to us. They just came in and said, ‘We have no financial need for this, but we just want it anyway because we figure we can get away with it.’ ”

Negotiations have not been held since May, and Dr Pepper Snapple says it has no intention of resuming them. The company has continued to operate the plant using replacement workers and says that production of apple juice and apple sauce is growing each day. Union officials say production is one-third of what it was before the walkout.

The Mott’s workers voted 250 to 5 to strike, walking out on May 23. They were furious about the company’s demands to cut their wages by about $3,000 a year, freeze pensions, end pensions for new hires, reduce the company’s 401(k) retirement contributions and increase employees’ costs for health care benefits. Dr Pepper Snapple said it was merely seeking to bring its benefits more in line with those of its other plants.

Even before the strike vote, workers were stewing, saying that management had begun treating them far worse after Cadbury Schweppes, the former owner, spun off its American beverages division in 2007, creating Dr Pepper Snapple.

The new management eliminated their bonuses, the summer picnic and the year-end holiday party for employees’ children, several workers complained.

Fidel Castro Fascinated by Book on Bilderberg Club

Associated Press:

By WILL WEISSERT (AP) – 14 hours ago

HAVANA — Fidel Castro is showcasing a theory long popular both among the far left and far right: that the shadowy Bilderberg Group has become a kind of global government, controlling not only international politics and economics, but even culture.

The 84-year-old former Cuban president published an article Wednesday that used three of the only eight pages in the Communist Party newspaper Granma to quote — largely verbatim — from a 2006 book by Lithuanian-born writer Daniel Estulin.

Estulin's work, "The Secrets of the Bilderberg Club," argues that the international group largely runs the world. It has held a secretive annual forum of prominent politicians, thinkers and businessmen since it was founded in 1954 at the Bilderberg Hotel in Holland.

Castro offered no comment on the excerpts other than to describe Estulin as honest and well-informed and to call his book a "fantastic story."

Estulin's book, as quoted by Castro, described "sinister cliques and the Bilderberg lobbyists" manipulating the public "to install a world government that knows no borders and is not accountable to anyone but its own self."

The Bilderberg group's website says its members have "nearly three days of informal and off-the-record discussion about topics of current concern" once a year, but the group does nothing else.

It said the meetings were meant to encourage people to work together on major policy issues.

The prominence of the group is what alarms critics. It often includes members of the Rockefeller family, Henry Kissinger, senior U.S. and European officials and major international business and media executives.

The excerpt published by Castro suggested that the esoteric Frankfurt School of socialist academics worked with members of the Rockefeller family in the 1950s to pave the way for rock music to "control the masses" by diverting attention from civil rights and social injustice.

"The man charged with ensuring that the Americans liked the Beatles was Walter Lippmann himself," the excerpt asserted, referring to a political philosopher and by-then-staid newspaper columnist who died in 1974.

"In the United States and Europe, great open-air rock concerts were used to halt the growing discontent of the population," the excerpt said.

Castro — who had an inside seat to the Cold War — has long expressed suspicions of back-room plots. He has raised questions about whether the Sept. 11 attacks were orchestrated by the U.S. government to stoke military budgets and, more recently suggested that Washington was behind the March sinking of a South Korean ship blamed on North Korea.

Estulin's own website suggests that the 9/11 attacks were likely caused by small nuclear devices, and that the CIA and drug traffickers were behind the 1988 downing of a jetliner over Lockerbie, Scotland, that was blamed on Libya.

The Bilderberg conspiracy theory has been popular on both extremes of the ideological spectrum, even if they disagree on just what the group wants to do. Leftists accuse the group of promoting capitalist domination, while some right-wing websites argue that the Bilderberg club has imposed Barack Obama on the United States to advance socialism.

Some of Estulin's work builds on reports by Big Jim Tucker, a researcher on the Bilderberg Group who publishes on right-wing websites.

"It's great Hollywood material ... 15 people sitting in a room sitting in a room determining the fate of mankind," said Herbert London, president of the Hudson Institute, a nonpartisan policy think tank in New York.

"As someone who doesn't come out of the Oliver Stone school of conspiracy, I have a hard time believing it," London added.

A call to a Virginia number for the American Friends of Bilderberg rang unanswered Wednesday and the group's website lists no contact numbers.

Castro, who underwent emergency intestinal surgery in July 2006 and stepped down as president in February 2008, has suddenly begun popping up everywhere recently, addressing Cuba's parliament on the threat of a nuclear war, meeting with island ambassadors at the Foreign Ministry, writing a book and even attending the dolphin show at the Havana aquarium.

Copyright © 2010 The Associated Press. All rights reserved.

Democrats Go GOP on Tax Cuts

Counterpunch.org:

August 18, 2010

Meandering Into the Midterm Elections

By ANTHONY DiMAGGIO

President Obama supports letting many of the Bush tax cuts expire. He’s defending the passage of a new round of tax cuts, promised to benefit America’s middle and working classes. These cuts, however, would continue to benefit the affluent, or those individuals earning more than $170,000 a year. CNN Money reports that the tax cuts promoted by Obama for the middle class would also reduce taxes for those making between $171,850 and $195,550. This group would now fall into a “sweet spot” that would reduce their payments from the 33 percent tax bracket down to the 28 percent tax bracket. In contrast, those individuals who make more than $200,000 would see their payments increase from the 36 percent bracket to the 39.6 percent bracket.

The increase in taxes for those making more than $200,000 is misleading, however. While these individuals would legally be required to pay more in terms of their tax bracket, they would nonetheless qualify for other tax reductions under Obama’s plan.

The details are provided by the Center on Budget and Policy Priorities (CBPP). The organization reports that under Obama’s plan, “people making more than $1 million will receive more than five times the tax cut benefit, in dollar terms, as a middle class family making $50,000 to $75,000. The wealthy would qualify for cuts under the proposed extension of the income tax rate reductions and married filers’ reductions. In relation to the income tax, the CBPP estimates that those in the $200,000 to $500,000 income category would receive, on average, an 83 percent greater tax cut than those immediately below them earning more than $100,000 but less than $200,000. Those earning between $500,000 and $1 million would receive, on average, a 13 percent greater tax cut than those immediately below them making between $200,000 and $500,000. Finally, individuals earning more than $1 million would benefit from a 15 percent greater cut than those immediately below them making between $500,000 and $1 million. These numbers may sound confusing, but the major theme is really quite simple: as an individual’s (or a household’s) earnings increase into the six figures and beyond, they will be entitled to increasingly larger tax cuts under the Obama plan when compared to middle, working class, and poor Americans.

The Obama tax cuts, while clearly benefitting the middle class in many ways, will also represent a major pay day for America’s upper class. This apparently isn’t enough for Republicans in Congress, however. They complain that the rich should benefit from all the tax cuts granted under Bush, not merely some of them. They feel that any tax increases (relatively to the cuts the rich received in the last few years) are illegitimate. Nowhere is this position more clearly declared than by House of Representatives Republican Minority Leader John Boehner, who defends the Bush era tax cuts, which went overwhelmingly to the wealthiest one to five percent of Americans.

Boehner complains that “you can’t raise taxes in the middle of a weak economy without risking the double-dip in this recession…You cannot get the economy going again by raising taxes on those people who we expect to create jobs in America and to get the economy going again. If we want to solve the budget problem, we’ve got to have a healthy economy and we have to get our arms around the runaway spending that’s going on in Washington, D.C.”

The supply side notion (first advocated by the Reagan administration) claims that economic growth only comes from massive tax cuts directed toward the rich. This theory, although promising prosperity for America’s middle class and poor, has done little to deliver benefits to the masses. A careful study from the Economic Policy Institute finds that “the economy has little to show for the $860 billion in tax cuts” passed under Bush from 2001 to 2005. In this EPI report, Lee Price concludes that “by virtually every measure the economy has performed worse in this business cycle than was typical in past ones, including that of the early 1990s, which saw major tax increases.” The EPI compares the 2001 to 2005 business cycle to other cycles in history (a cycle being defined in economics as a period beginning with a contraction in national GDP, a trough period when contraction ends and expansion begins, a sustained expansion period, and a peak of growth). EPI finds that, in spite of the 2001 and 2003 tax cuts, “almost every broad measure of economic activity – GDP, jobs, personal income, and business investment, among others – has fared worse over the last four and a half years (again, 2001 to 2005) than in past cycles.”

The EPI’s findings raise serious questions about the effectiveness of tax cuts aimed at the rich in bringing about economic recovery. The worthlessness of tax cuts for the rich in assuring middle class prosperity has been reinforced over the last few years as well. The Bush tax cuts are set to expire this year. Since the 2008 economic collapse and ensuing recession, the Bush tax cuts (in addition to the massive infusion of TARP funds for American “too big to fail” banks) have not been sufficient to push the U.S. into a serious economic recovery at a time when those who still have jobs are working harder and harder for declining wages. It was not until this year that the recession formally ended (a recession being defined as two consecutive quarters of negative growth), and economic growth has been rather anemic, at just over one percent for the second quarter of 2010.

One would think that all these negative signs would be enough to convince Republicans (and conservative Democrats) not to renew tax cuts for the wealthy. This, however, has not been the case. The Republican Party – aided by reactionary pundits in the media – continues to push tax cuts for the rich. They do this, not because these cuts promote strong recovery and prosperity for middle America, but because they subsidize Republicans’ primary constituency – the rich. Democrats have long been reliant on, and supportive of corporate power as well, so their relatively weaker support for tax cuts for the rich is not surprising either.

Rather than asking what the Democrats and Republicans should be doing to reduce the size of government (as both parties’ leaders are doing), we should be asking how the government should be expanding its efforts to help the needy during times of economic desperation. The Democratic expansion of Medicaid under the 2010 health care reform bill will certainly help America’s poor in terms of increasing the size of the social welfare state, but a far larger (and much needed) expansion in the form of establishing a universal health care, Medicare-for-all system, would do a lot more in reducing the suffering of vulnerable Americans. What also would help the country (in addition to the recent extensions of unemployment and state school funds passed by Democrats in Congress) is another stimulus, which should be passed prior to the 2010 midterm elections.

The Democratic Party has gone Republican in at two ways when it comes to the tax cuts: 1. by pushing for a market solution over expanding government social welfare services; and 2. by continuing the tax cuts to the rich, even if in a reduced form from the far larger, more extreme amount preferred by conservatives. The choice to promote tax cuts over increased social spending (on food subsidies for the poor and on a new stimulus) signals a privileging of the well off over the truly needy. Instead of helping preserve the jobs of state educators and other public employees through massive stimulus spending, the Democrats have instead chosen to grant tax cuts to those who already have jobs. Why this group should be prioritized over the unemployed is anyone’s guess. The Democratic approach signifies the party’s increasing embrace of the Republican themes that “the government is the problem,” and that the best way to promote economic recovery is to reduce government revenues, and “give the people more of their own money,” rather than use that money to help those who are the most desperate.

There are penalties to be paid for going Republican at a time when Republicans are just as unpopular as the Democrats in the public mind. The Democratic Party’s emphasis on unnecessary tax cuts, and its timidity in pushing for an expansion of government stimulus has left us in the desperate economic position we are in today. The party is willing to promote at least limited welfare spending, passing $34 billion in unemployment extension benefits, and an additional $26 billion to help states fill their deficits and stave off cuts in education and Medicare. These most recent education and Medicaid packages, however, came along with $10 billion worth of cuts in food aid to the poor. The recent Medicaid, school, and unemployment bills also total just $50 billion for the year (after adjusting for the food aid cuts), and this represents a small fraction of the hole in state deficits that needs to be filled.

The state deficits for 2010 were estimated to total $192 billion, according to the CBPP. State deficits for 2011 are estimated at approximately $120 billion. Allowing all the Bush era tax cuts to expire would produce an additional $217 billion in revenues for the federal government throughout 2010 and 2011, according to a recent study by the Brookings Institute and the Urban Institute. This amount is more than enough to plug in the $120 billion hole in the 2011 state budget deficits. It’s unlikely that the Democratic Party will take this route, however, in light of its increasing support for Republican mantras about the holiness of tax cuts as a means of economic stimulation.

Democrats could single handedly end the state budget crises that will (sadly) continue to grip the country over the next year. Instead, they will continue to meander throughout the rest of 2010, refusing to push any sort of stimulus on par with the $787 billion stimulus package passed in 2009. Democratic refusals to pass a second stimulus will all but guarantee continued economic stagnation – and possibly decline. The party’s incompetence and preference for the rich will likely come back to haunt it in the 2010 election, in which the American public will angrily (and rightly) throw out many Democrats due to their mishandling of the economic crisis.

Anthony DiMaggio is the editor of media-ocracy (www.media-ocracy.com), a daily online magazine devoted to the study of media, public opinion, and current events. He has taught U.S. and Global Politics at Illinois State University and North Central College, and is the author of When Media Goes to War (2010) and Mass Media, Mass Propaganda (2008). He can be reached at: mediaocracy@gmail.com

"Financial Reform" Virtually Useless

ConsortiumNews.com:

US Staggers Toward Dysfunction

Danny Schechter
August 14, 2010

[. . .]

The private sector is not creating jobs. The GOP is blocking the government from doing more stimulus programs while the system seems to be unraveling.

All the talk of cutting deficits by conservatives or ending tax cuts by liberals will not give the economy the boost it needs. There is a paralysis of analysis and a stalemate.

The markets were more freaked by the recent pessimism oozing from the Fed than any partisan punditry. The slowdown they are worried about has already doomed any heavily-hyped “recovery.”

And the public knows it, according to the recent polls.

What’s worse is that the tea leaves offer few signs of a turnaround any time soon even if General Motors is selling more cars — many, may we be reminded, in China.

(The GM CEO who last week took a nasty ingrate smack at GM being perceived as “Government Motors,” demanding the government sell all of its shares, has just announced he is leaving! I wonder why?)

The Carlyle Group is taking over while the automaker launches a new program of subprime lending, the very predatory deal-making that got them in trouble in the first place.

Does anyone ever learn from history, or care about how communities are being destroyed as a financial crisis becomes a social crisis at the grassroots level?

Check out what happened at that mall in Atlanta where thousands of people nearly rioted to get on a public housing waiting list.

The Congress returned from its recess to pass new monies to keep teachers teaching and cops patrolling. They did so by slashing food stamps so the unemployed and poor will have to cut back further.

What a trade-off.

As for insuring the stability of an increasingly volatile system, will the new financial reforms make any difference? It doesn’t look like it.

The New York Times reported, “As Wall Street scrambles to find the best and most profitable way to operate under the new financial reform law, Goldman Sachs Group Inc. — the firm that was expected to suffer the most under the legislation — could emerge practically unscathed.”

"We think we are well positioned to be a market leader under the new rules,” Jack McCabe, co-head of Goldman's derivatives clearing service business, was quoted as saying.

As for the law’s effect on Goldman, Richard Bove, a bank analyst at Rochdale Securities, said he had changed his view.

"I thought this company was going to be really harmed by this bill; now I've figured out that it's not going to happen," he said. "They should win big here."

That’s Goldman’s reason to celebrate its “big win” What about the others?

The truth is we will not know for a awhile, for a long while, for many, many years. So much for any sense of urgency even after former Federal Reserve Chairman Paul Volcker said we are running out of time.

Bloomberg News explained why

“Many of the measures ordered by Congress and global regulators, aimed at cushioning the financial system in future crises, are years away from being implemented. The Basel Committee on Banking Supervision plans to give the world’s banks until 2018 to comply with limits on how much they can borrow.

“Parts of the Volcker rule, a provision of the new Dodd-Frank Act that would force firms to cut stakes in in-house hedge funds and private-equity units, may not go into effect for a dozen years.”

“Based on our experience of government’s ability to execute these things effectively and in a timely way, we are almost uncovered now from any future financial risk for at least another 8 or 10 years, and that’s a little scary,” said Roy Smith, finance professor at New York University’s Stern School of Business and a former banker at Goldman Sachs Group Inc.

Economist Nouriel Roubini, one of the first to forecast our crisis, worries that major economies in Europe are at risk and could fall.

At the same time I am reading articles that contend, “The US is more bankrupt than Greece.” Another reports the IMF saying the US is bankrupt but most Americans don’t know it.

What else don’t we know?

At the same time, the folks who brought us this crisis are still riding high, making multi-million dollar “settlements” to cover up fraudulent practices. In recent weeks, Goldman Sachs, Countrywide and, now, Wells Fargo have just done that in part to avoid prosecutions.

Their CEOS are going on vacation to spend their ill-gotten gains, not to jail to pay for their crimes. And the “professional left” — whatever that is supposed to be – is more pissed at Robert Gibbs blathering at that podium than the banksters maneuvering behind the scenes.

Can anyone tell me what’s wrong with this picture?

State of the Art Navy vs. State of the Art Missiles

The implication here is that, if push comes to shove, the US Navy is a dinosaur waiting to become extinct. I heard a similar story the other day about how Iran has hundreds of these anti-ship ballistic missiles, should the US or Israel try something stupid. Just search on "iran dongfeng 21d"...

From Prairie2.com (whom I first heard on Mike Malloy's show):

Monday, August 9, 2010

Would you like rice with your Cold War Special?

The USS George Washington (CVN-73) spent the weekend cruising 200 miles off shore from Danang, The Socialist Republic of Vietnam. What’s going on you say, does Nike need negotiating leverage for that new sneaker plant? Officially the “G-Dub” was there to commemorate the 15th anniversary of the normalization of relations between the US and SRV. It did however bring along 4 million pounds of bombs, seventy aircraft and 6000 men and women ready to go to war at the sound of the claxon.

Based in Japan the “G-Dub” is widely believed to carry a typical deployment of 100 nuclear warheads. Japan has revealed recently that they have always turned a blind eye to this despite official policy prohibiting nuclear weapons on their soil.

Were the Vietnamese upset with this show of force just outside their territorial waters? No, in fact they could not have been more pleased as they chose the location. This is the part of the South China Sea that they claim as their own that includes a number of small islands known as the Spratly and Paracel Islands. These islands are the reason Hanoi and Washington are getting so cozy militarily.

The super carrier task force arrived off Vietnam having just completed joint exercises with South Korea and during the entire trip from Japan they were shadowed by a number Chinese warships. You see Beijing claims absolute sovereignty over the entire South China Sea, its islands, fishing grounds, oil & gas reserves and the sea lanes themselves. They don’t care much for trespassers but so far have been out gunned by the USN.

Vietnam has tried very hard to cultivate relations with the US, especially after the collapse of their primary benefactor, the Soviet Union. Before, during and after the US-Vietnam War, the Vietnamese were at war with China and repelled several invasion attempts that killed large numbers on both sides. The third and final invasion took place in 1979 and China withdrew after taking heavy losses but looted and laid waste to the northern part of Vietnam on the way out.

China has made no secret of the fact that at some point they intend to throw the US out of its South China Sea. To press home that point they have recently announced the pending deployment of a new generation of hyper-sonic anti-ship missile called the Dong Feng 21D. With a large conventional or nuclear warhead and a 900 mile range they are reportedly capable of defeating any counter measures and intercepting a moving target. Of course at 6000 miles per hour it closes the 900 miles in 9 minutes, so even at flank speed a carrier would only move maybe five miles, not quite like shooting fish in a barrel but close. Some reports are that the new missile may have a much longer range on the order of 2000 miles.

There is a debate about when the weapon will be deployable, it could be ten years or maybe less than two. There is no question that China is capable of producing such a weapon thanks to technology sharing by American companies like Boeing and Lockheed. In order to get access to cheap manufacturing, US companies are required to turn over information that prior to the Bush Administration people went to prison for giving up.

In short, the greed of American corporations has made possible a new Cold War. Of course FOX News is making the most it can from the tensions by hyping fear of the yellow peril. This allows the same “defense” contractors that gave China the technology to be able to sell even more hardware to the US military to counter this “unexpected” threat. China will of course increase their military spending, they can afford it and they have the factories. The right-wing is probably kidding itself that we can out spend China and destroy it like Reagan did to the Soviets. That wasn’t what really happened of course, the USSR was on an irreversible downward spiral long before Reagan, kind of like the one we are on. www.prairie2.com

Watching the Disintegration of the US Infrastructure

This is so sad, and as is so often the case with sad things, so unnecessary.

Salon.com:

Friday, Aug 6, 2010 12:07 ET

What collapsing empire looks like

By Glenn Greenwald:

As we enter our ninth year of the War in Afghanistan with an escalated force, and continue to occupy Iraq indefinitely, and feed an endlessly growing Surveillance State, reports are emerging of the Deficit Commission hard at work planning how to cut Social Security, Medicare, and now even to freeze military pay. But a new New York Times article today illustrates as vividly as anything else what a collapsing empire looks like, as it profiles just a few of the budget cuts which cities around the country are being forced to make. This is a sampling of what one finds:

Plenty of businesses and governments furloughed workers this year, but Hawaii went further -- it furloughed its schoolchildren. Public schools across the state closed on 17 Fridays during the past school year to save money, giving students the shortest academic year in the nation.

Many transit systems have cut service to make ends meet, but Clayton County, Ga., a suburb of Atlanta, decided to cut all the way, and shut down its entire public bus system. Its last buses ran on March 31, stranding 8,400 daily riders.

Even public safety has not been immune to the budget ax. In Colorado Springs, the downturn will be remembered, quite literally, as a dark age: the city switched off a third of its 24,512 streetlights to save money on electricity, while trimming its police force and auctioning off its police helicopters.

There are some lovely photos accompanying the article, including one showing what a darkened street in Colorado looks like as a result of not being able to afford street lights. Read the article to revel in the details of this widespread misery. Meanwhile, the tiniest sliver of the wealthiest -- the ones who caused these problems in the first place -- continues to thrive. Let's recall what former IMF Chief Economist Simon Johnson said last year in The Atlantic about what happens in under-developed and developing countries when an elite-caused financial crises ensues:

Squeezing the oligarchs, though, is seldom the strategy of choice among emerging-market governments. Quite the contrary: at the outset of the crisis, the oligarchs are usually among the first to get extra help from the government, such as preferential access to foreign currency, or maybe a nice tax break, or -- here's a classic Kremlin bailout technique -- the assumption of private debt obligations by the government. Under duress, generosity toward old friends takes many innovative forms. Meanwhile, needing to squeeze someone, most emerging-market governments look first to ordinary working folk -- at least until the riots grow too large.

The real question is whether the American public is too apathetic and trained into submission for that to ever happen.

UPDATE: It's probably also worth noting this Wall St. Journal article from last month -- with a subheadline warning: "Back to Stone Age" -- which describes how "paved roads, historical emblems of American achievement, are being torn up across rural America and replaced with gravel or other rough surfaces as counties struggle with tight budgets and dwindling state and federal revenue." Utah is seriously considering eliminating the 12th grade, or making it optional. And it was announced this week that "Camden [New Jersey] is preparing to permanently shut its library system by the end of the year, potentially leaving residents of the impoverished city among the few in the United States unable to borrow a library book free."

Does anyone doubt that once a society ceases to be able to afford schools, public transit, paved roads, libraries and street lights -- or once it chooses not to be able to afford those things in pursuit of imperial priorities and the maintenance of a vast Surveillance and National Security State -- that a very serious problem has arisen, that things have gone seriously awry, that imperial collapse, by definition, is an imminent inevitability? Anyway, I just wanted to leave everyone with some light and cheerful thoughts as we head into the weekend.

Latest October Surprise report from Robert Parry

Consortiumnews.com:

October Surprise Cover-up Unravels By Robert Parry August 6, 2010

Not to belabor a point, but some die-hard defenders of the October Surprise cover-up continue to insist that there is real evidence debunking the now overwhelming case that Ronald Reagan’s 1980 campaign interfered with President Jimmy Carter’s negotiations to free 52 American hostages then held in Iran.

One defender claimed in a recent blog post: “calendars, eyewitness accounts, telephone logs and credit card receipts showed that [Reagan’s campaign chief William Casey] was in the United States and London at the time of the alleged meetings” in Madrid and Paris.

But that simply isn’t true. What is true is that a series of fabricated alibis for Casey and others have come apart at the seams, starting with the initial alibi that was concocted for Casey by The New Republic and Newsweek.

[. . .]

Official Social Security Report In!

...and, of course, everything's just fine...

OurFuture.org:

What Social Security Report SAYS vs What They Tell You It Says

By Dave Johnson

August 5, 2010 - 1:59pm ET

The Social Security and Medicare Boards of Trustees today released their report on the Status of the Social Security and Medicare Programs. Here is what it says:

Social Security Just Fine Until At Least 2037

The summary of the report says, "The financial outlook for Social Security is little changed from last year. The short term outlook is worsened by a deeper recession than was projected last year, but the overall 75-year outlook is nevertheless somewhat improved..." and is otherwise fine until at least 2037 with no changes.

It is just fine forever, in fact, if we do something simple like raise the "cap" on earnings that are taxed to pay for the program. (That's right, when you make more than a certain income level you stop paying the tax!) Compare that to the military budget. We spend more than $1 trillion on military and related programs each year - more than every other country combined - and unlike Social Security that is completely "unfunded," and adds to the deficit.

Medicare Outlook Improved Substantially

The report also says, "The outlook for Medicare has improved substantially because of program changes made in the [Health Care Reform Bill]"

Those Are The Facts

Those are the simple facts: everything is fine. Everything will be fine. There are some things that should be changed to make them even more OK than they are. They are good programs that demonstrate that government works.

So What's The Problem?

The Social Security program collects money via the "payroll tax." Much, much more money -- trillions -- has been collected than needed to be paid out to cover the coming retirement of the "baby boomers," and the extra -- the "trust fund" -- was invested in US Treasury Bonds.

Under Reagan and then both Bushes that money was borrowed from the trust fund and used to give huge tax cuts to the wealthy. (Clinton was paying it back but Bush II cut taxes again for the wealthy.) Now those boomers are beginning to retire, and the trust fund money that was borrowed and given out to the rich is needed back to cover their retirement. The obvious solution is to get the money from where the money went. But those who it went to are trying to stop the obvious from happening. They say we should cut benefits, make us retire at 70, anything to keep them from paying back what is owed to the retirees.

Oh, and there is another conservative complaint about Social Security. Social Security is very successful and popular, and is a constant, living proof that government of the people, by the people and for the people works and works really well. Among a certain crowd, that just can't be allowed to stand.

So now, let the anti-tax, anti-government conservative bamboozlement begin.

Let The Bamboozlement Begin

The anti-government conservatives are using several approaches to undermine public confidence in the program (and therefore government). MoveOn.org has a "Top 5 Social Security Myths" page up that is worth looking at.

Myth: Social Security is going broke.
Myth: We have to raise the retirement age because people are living longer.
Myth: Benefit cuts are the only way to fix Social Security.
Myth: The Social Security Trust Fund has been raided and is full of IOUs.
Myth: Social Security adds to the deficit.

Please go to the website to learn the truth about these myths. And please answer with those facts when you hear people spreading these myths.

Let's see how the conservatives are doing at spreading myths today, and how the mainstream media covers it:

Heritage Foundation: Once Again, the Social Security Trust Fund Has No Money in It

Washington Times: Social Security in the red for first time ever (Note - that's only if you don't count the interest that the trust fund earns. Just more bamboozlement.)

FOX News: Social Security 2010 Outlays to Exceed Receipts

CNN: Social Security: More going out than coming in

NPR: 2010 Social Security Outlook: Not Great

CNBC: Social Security 2010 outlays to exceed receipts

That's just a quick sampling. Compare what these headlines lead you to believe to the facts above. When was the last time you saw a headline that reads, "Massive military budget causes huge federal deficit"? Right. Bamboozlement, plain and simple. Expect to see a lot more like these. Don't fall for it.

Social Security Is Not Broken

Social Security is not broken. If we fight the myths and the anti-government lies it will be there for all of us.

Here is a statement by Nancy Altman, co-chairman of the Strengthen Social Security Campaign, a coalition of 60+ organizations, representing over 30 million Americans:

“Every year, the trustees’ reports become an excuse for fear mongering by those who should know better. This year, the news is especially good for Medicare, thanks to the enactment of health care reform. The news for Social Security is even better, revealing once again that Social Security’s promised benefits are fully affordable without benefit cuts and without increasing the retirement age. Poll after poll reports that’s what the American people want. Unfortunately, we know there are some in Washington, including a few members of the Administration’s fiscal commission, who will use this report to try to advance their agenda of cuts to Social Security benefits, including rising the retirement age. Politicians should stop scaring the American people. Social Security is strong and should be strengthened, not cut. The reality is the biggest threat to Social Security is the politicians in Washington who continue to play politics with this issue.”

Send a message to the politicians: No increase in the retirement age. No privatization. No Social Security cuts. Go to ourfuture.org/nosocialsecuritycuts.

Stan McChrystal and Lynndie England: Compare and Contrast

Antiwar.com:

Code of Military Justice

by Jeff Huber, August 03, 2010

Gen. Stan McChrystal, United States Army, will leave active service with four stars instead of three because of a special waiver bestowed on him by President Barack Obama. One is supposed to hold four-star rank for three years before one can retire at that pay grade, something McChrystal obviously didn’t do, but Obama made nice and let him walk away with a full set of collar candy anyway. The extra star makes a staunch bit of difference in McChrystal’s retirement pay. He’ll start at $181,416 per year versus the measly $160,068 he would have received otherwise. But both of those amounts are chump change compared to what Mr. McChrystal is likely to knock down in his Beltway banditry career.

Noted counterinsurgency illusionist John A. Nagl, a retired Army light colonel and a Beltway bandit himself, says that “forcing” McChrystal to retire with three stars “would have sent a signal that he was out of favor.” Colleagues, according to the New York Times, say that because McChrystal kept his fourth star he’s not “radioactive,” so he can expect a bright future “as a well-paid outside consultant to the Pentagon or a government intelligence agency.” Don’t be shocked to see McChrystal named CEO of whatever Blackwater winds up calling itself next.

Retired three-star Beltway bandit Jack Keane, a key node in the war mafia’s AIPAC-neocon-Pentagon-Congress-White House connections, says of his protégé McChrystal, “Stan will land on both feet, make no mistake about that.”

Lynndie England, the marginally self-aware former private in the United States Army Reserve, was one of the few bad apples who took the fall for the Abu Ghraib torture scandal. She received no pension at all after she left the Army with a dishonorable discharge, and she couldn’t get back her civilian job as a chicken-plucker after she was released from military prison.

It took two trials by courts-martial to convict England. The judge in the first court-martial, Army Col. James Pohl, declared a mistrial because he doubted whether England was mentally competent enough to understand what a raw plea deal her incompetent military defense lawyers had wheedled her into. Pohl also questioned whether she possessed sufficient cognizance to discern right from wrong. The five officers on the second jury clearly had a more flexible conscience about making junior enlisted personnel the patsies for policies established at the four-star level and above; they sentenced her to a three-year term.

Torture was a key aspect of what “King David” Petraeus recently referred to as McChrystal’s “exceptional leadership” as commander of the infamous Joint Special Operations Command. As head of JSOC, McChrystal was directly responsible for the interrogation camp in Iraq known as NAMA, an acronym that stood for “Nasty A** Military Area.” The Camp NAMA motto was “No Blood, No Foul,” a slogan that reflected the interrogators’ philosophy that “If you don’t make them bleed, they can’t prosecute for it.” As one Pentagon official explained, “there were no rules there.” The Red Cross was never allowed into NAMA on order of Gen. McChrystal, who visited the place a number of times and who had a really darn good idea what was going on there.

Journalist Seymour Hersh called the JSOC part of an “executive assassination ring” that McChrystal ran under the direct control of Dick Cheney, who as vice president had no constitutional or legal authority in the military chain of command. Gen. Stan and his Howling Commandos, along with CIA hooligans, Blackwater yahoos-of-fortune, and other patriotic psychopaths, rubbed out God only knows how many “suspected” terrorists who were identified by intelligence beaten or bribed out of nefarious sources. There’s no telling how many innocent civilians were slaughtered in the process of these vigilante-style shoot-em-ups.

McChrystal has more blood on his hands than Macbeth and his wife put together, and he is as mendacious as he is murderous. His involvement in the cover-up of the Gardez Massacre, in which U.S. Special Forces destroyed evidence of collateral damage by digging their bullets out of the corpses of civilians, made his whitewash of the Pat Tillman fratricide affair seem venial by comparison, a petty sin that might be absolved with a fistful of Hail Marys.

By rights, McChrystal should be the gaunt, smirking face of American war atrocities, but he is far, far too special to be cast as a villain. Born of military nobility – his father was a two-star general – McChrystal learned early in life how to work his decoder ring and give the secret handshake. West Point Cadet McChrystal made his reputation as a bad boy, but he always knew just how far he could push things and still land on the safety network his father’s connections provided him.

It’s little wonder that he got away with MacArthur-magnitude insubordination when he used his 60 Minutes infomercial and other media tricks to corner Obama into going along with escalating the Bananastans* fiasco. And the Rolling Stone escapade was a stroke of passive-aggressive virtuosity. A diamond-studded parachute, it bailed McChrystal out of responsibility for the disaster he had created.

McChrystal is as made a guy as a guy can get made in the American war mafia. His bollixing of the Bananastans conflict has become the crown jewel of the Pentarchy’s** Long War strategy by making Obama’s July 2011 withdrawal date vanish like a wallet on a Chicago sidewalk. Will he ever go to trial for war crimes? Forget about it. A whole bunch of people in a lot of high places knew what McChrystal was up to and tacitly if not actively approved of it, and if he ever faces criminal charges, he’ll sing like Frank Sinatra.

Lynndie England grew up in a trailer park. In grade school she was diagnosed with severe learning disabilities. How she got into the Army Reserve is anyone’s guess. She doesn’t have friends in high places, or anywhere else for that matter. Upon her release from prison, she returned home with her son (by fellow Abu Ghraib felon Charles Graner) to West Virginia, where, according to a March 2009 Associated Press story, she “spends most of her days confined to her home.” She says she suffers from depression and anxiety, a claim one finds easy enough to believe.

She gets by on welfare and help from her parents. In 2007 she landed a spot on her local recreation board, but it was a non-paying position. Though she’s sent out hundreds of resumés, she can’t find a paying job. When one restaurant manager considered hiring her, the other employees threatened to quit.

People point and whisper, “That’s her.” England relates that one stranger sent her a note that suggested her mother should “shoot herself for raising somebody like me, and that I should kill my baby and kill myself, or give up my child for adoption, because the way I was raised they didn’t want him to turn into some evil monster, too.”

She has tried changing her appearance by dying her hair and wearing sunglasses and ball caps. “But it’s my face that’s always recognized,” says England, who never once directly or indirectly or on purpose or by accident caused the death of a single human being.

* The Bananastans are Afghanistan and Pakistan, our banana republics in Central Asia.

** The Pentarchy is the cabal of oligarchs who support and promote the Pentagon’s Long War agenda.