Posted: August 26, 2014 | Author: bostonboomer | Filed under: Barack Obama, Foreign Affairs, France, George W. Bush, Germany, Iraq, morning reads, racism, Syria, U.S. Economy, U.S. Politics, unemployment | Tags: Al Nusra Front, al Qaeda, Angela Merkel, austerity, European Central Bank, Ferguson MO, ISIS, James W. Foley, Janet Yellen, Mario Draghi, Michael Brown, Peter Theo Curtis, The Islamic State, the NEW York Times |

The Dog Days of Summer, Janet Hill
Good Morning!!
It’s the last week of August, and the dog days of summer have supposedly passed; but the Boston area is supposed to hit ninety degrees today and tomorrow. I’m actually looking forward to it, because it has been so cool here lately–in the sixites and low seventies in the daytime and the fifties at night. Yesterday it got into the high eighties, and it felt wonderful.
The Boston Globe has a story today about Peter Theo Curtis, the writer who was just released from captivity in Syria. His mother lives in Cambridge. I had never heard of Curtis before; apparently his kidnapping was kept secret. The Globe reports: Militants free US writer with Mass. ties who was held in Syria.
Peter Theo Curtis, a writer and scholar with ties to the Boston area who was held captive for nearly two years by one of the Islamic militant groups operating in Syria, was released Sunday after emissaries from the government of Qatar won his freedom on humanitarian grounds, in a stark contrast to the brutal murder of fellow war correspondent James W. Foley .
Curtis’s 22 months in captivity were kept from the public at his family’s request since he was nabbed near the Syrian border in October 2012 by Al Nusra Front, one of the groups seeking to topple President Bashir Assad of Syria. Al Nusra Front has ties to the Al Qaeda terrorist network.
Curtis, 45, who wrote dispatches under the name Theo Padnos and previously chronicled disaffected young Muslims in Yemen in a book titled “Undercover Muslim,” had studied Arabic in Syria.
He was handed over to United Nations peacekeepers in the Israeli-occupied Golan Heights on Sunday evening, a UN spokesman in New York said. After it was determined he was in good medical condition, he was transferred to representatives of the US government, according to the UN.
“We are so relieved that Theo is healthy and safe and that he is finally headed home after his ordeal,” his mother, Nancy Curtis, who lives in Cambridge, said in a statement, “but we are also deeply saddened by the terrible, unjustified killing last week of his fellow journalist, Jim Foley, at the hands of the Islamic State in Iraq and Syria, ISIS.”
Foley was from New Hampshire, and the two families have gotten to know each other well, according to Curtis.

Garden Shed – Late Summer, KK Marais
Syria and Iraq
President Obama has authorized surveillance flights over Syria, according to BBC News.
Correspondents say the move could mark the first step towards US air strikes inside Syria, where the jihadist group controls vast swathes of territory.
The US is already carrying out strikes against IS in neighbouring Iraq.
On Monday, the Syrian government said it would work with the international community in the fight against IS.
Western governments have so far rejected suggestions that they collaborate with President Bashar al-Assad in an attempt to counter the growing regional threat posed by IS….
On Monday evening, US officials said Mr Obama had approved over the weekend reconnaissance flights by unmanned and manned aircraft, including drones and possibly U2 spy planes.
The US military has been carrying out aerial surveillance of IS – an al-Qaeda breakaway formerly known as Isis – in Iraq for months and launched air strikes on 8 August.
From The Boston Globe, citing “AP sources,” U.S. planes have already begun flying over Syria.
KABUL, Afghanistan (AP) — The U.S. has begun surveillance flights over Syria after President Barack Obama gave the OK, U.S. officials said, a move that could pave the way for airstrikes against Islamic State militant targets there.
While the White House says Obama has not approved military action inside Syria, additional intelligence on the militants would likely be necessary before he could take that step. Pentagon officials have been drafting potential options for the president, including airstrikes.
One official said the administration has a need for reliable intelligence from Syria and called the surveillance flights an important avenue for obtaining data.
Two U.S. officials said Monday that Obama had approved the flights, while another U.S. official said early Tuesday that they had begun. The officials were not authorized to discuss the matter by name, and spoke only on condition of anonymity.
Jim Michaels of USA Today spoke to Gen. Dempsey on Sunday about what is being done to deal with ISIS in Iraq.
ABOARD A U.S. MILITARY AIRCRAFT — U.S. airstrikes on Islamic militants in Iraq have blunted their momentum, but defeating them will require a broad regional approach that draws support from Iraq’s neighbors and includes political and diplomatic efforts, the top U.S. military officer said.
The long-term strategy for defeating the militants includes having the United States and its allies reach out to Iraq’s neighbors, including Jordan, Saudi Arabia and Turkey, Gen. Martin Dempsey, chairman of the Joint Chiefs of Staff, said Sunday….
Dempsey is working with Central Command to prepare “options to address [the Islamic State] both in Iraq and Syria with a variety of military tools including airstrikes,” said Col. Ed Thomas, Dempsey’s spokesman, in a statement.
The militant group Islamic State, also known as ISIS, has shown itself to be so brutal that Iraq and the U.S. should be able to find “willing partners” to join efforts to defeat the militants, Dempsey said.
But military power won’t be enough, Dempsey said. The strategy must take a comprehensive approach that includes political and diplomatic efforts to address the grievances of millions of Sunnis who have felt disenfranchised by Iraq’s Shiite-dominated government, he said.

Late Summer Garden, John Gordon
I get the feeling that we’re never going to escape involvement in the endless Middle East conflicts, thanks to George W. Bush, Dick Cheney, and the rest of the neocon gang. What a horrible mess! We have our own messes to deal with here, but foreign wars always seem to trump the needs of the American people.
John Cassidy speculates at The New Yorker: What’s Next in Iraq and Syria?
On his first full day back from vacation, President Barack Obama could be forgiven for wishing he were still on Martha’s Vineyard. With confirmation that ISIS fighters have just captured another military base from the government forces of President Assad, and that Qatar has engineered the release of an American freelance journalist who was being held by a non-ISIS jihadist group, Obama has two formidable challenges to deal with.
The immediate task for Obama is deciding whether to launch American bombing raids on ISIS positions inside Syria, while simultaneously preparing his Administration, and the country at large, for the possibility of another video showing an American hostage being butchered. The ISIS militants, having carefully orchestrated the beheading of James Foley following the launch of U.S. strikes inside Iraq, will surely seek to exploit the fate of its remaining American hostages for maximum effect. Any U.S. decision to expand its air campaign is almost certain to be met with the release of more snuff films.
No President—no American—could take such a prospect lightly. At the same time, Obama has to guard against allowing emotion and wishful thinking to take over U.S. policy. That’s what happened after 9/11, and some of the chaos that we now see in the Middle East can be traced back to that historic blunder. What’s needed is calm cost-benefit analysis of the options open to the United States, taking account of its strategic interests, its values, and its capabilities. In short, we need what Danny Kahneman, the Princeton psychologist who pioneered behavioral economics, would refer to as some Type 2 thinking: a disciplined weighing of the likely consequences of our actions. If we give into our Type 1 reaction—horror, outrage, anger—we will be playing into the hands of the jihadists.
One place to start is by acknowledging two errors in thinking that have blighted U.S. policy in the past decade: the conservative delusion that the United States could, more or less single-handedly, use its military power to reinvent the Middle East, and the liberal illusion that we could simply walk away from the mess that Bush, Cheney & Co. created. Without the political willingness and the financial capability to garrison the region in the manner of postwar Germany and Japan, U.S. influence has to be exercised through air power, political proxies, economic inducements, and regional alliances. But that doesn’t diminish the fact that the United States and other Western countries have vital interests at stake, one of which is preventing the emergence of a rogue Islamic state that would provide a rallying point, and a safe haven, for anti-Western jihadists the world over.
Read the whole thing at the link.

A Garden in a Sea of Flowers, Ross Turner
The Economies of the U.S. and Europe
There has been so much breaking news for the past couple of months that we haven’t talked much about the economies of the U.S. and Europe. But today the European Central Bank is topping the headlines, and last week Fed Chairperson Janet Yellen spoke at Jackson Hole, so I thought I’d post a few economics stories.
Here’s CNN Money’s report on Yellen’s speech, Janet Yellen: Job market not recovered.
That was Federal Reserve Chair Janet Yellen’s main message Friday in a much anticipated speech.
“It speaks to the depth of the damage that, five years after the end of the recession, the labor market has yet to fully recover,” she said.
The debate now is whether the job situation in America is healthy enough for the Federal Reserve to start raising interest rates, which have been at historic lows in recent years in an effort to jump start the economy. Yellen, however, said little new on Friday, and U.S. stock markets stayed flat.
Yellen is chair of the committee that sets interest rates, but she only gets one vote. Other members have differing views. The Fed board and other top economists are spending the weekend in Jackson Hole, Wyoming, debating these key issues.
Though the unemployment rate “has fallen considerably and at a surprisingly rapid pace,” Yellen said problems remain.
Yellen called attention to what Americans in the job market already know–though the employment numbers look better, many people have stopped looking for work, and most of the new jobs are part-time and pay low wages.
A few more U.S. economy stories to check out:
The Wall Street Journal: Fed’s Yellen Remains Mum on Timing of Rate Change.
Bloomberg Businessweek: Yellen Job-Slack View Muddied by Pent-Up Wage Deflation.
Slate: The Fed Is Not As Powerful As We Think.
If you think the economy is struggling here, you should take a look at Europe, where austerity thinking has ruled since the economic crisis hit. Yesterday the French government collapsed. From The New York Times, French Cabinet Is Dissolved, a Victim of Austerity Battles.
PARIS — The collapse of the French government on Monday exposed widening divisions both within France’s leadership, and Europe more broadly, over austerity policies that many now fault for threatening to tip the eurozone back into recession.
Prime Minister Manuel Valls announced that he would dissolve his government after a rancorous battle in his cabinet over whether the belt-tightening measures taken by President François Hollande — at the urging of Germany and European Union officials in Brussels — were impeding France’s recovery.
The dispute broke into the open when Mr. Vall’s outspoken economy minister, Arnaud Montebourg, insisted in an interview over the weekend that austerity had gone too far. “The priority must be exiting the crisis, and the dogmatic reduction of deficits should come after,” he told the newspaper Le Monde.
He also took direct aim at the policies of Angela Merkel, the German chancellor. “Germany is caught in a trap of austerity that it is imposing across Europe,” he said.
Even the formerly strong German economy is struggling now, according to Reuters (via NYT), Crisis in Ukraine Drags Economy in Germany.
The eurozone’s flatlining economy took another hit on Monday when data showed German business sentiment sagging for the fourth consecutive month. Chancellor Angela Merkel attributed some of her own country’s decline in the second quarter to the Russia-Ukraine crisis, over which tit-for-tat sanctions threaten trade. The Munich-based Ifo, a research firm, echoed some of those sentiments as it reported its business climate index, based on a monthly survey of some 7,000 companies, fell to a worse-than-expected 106.3 from 108, the lowest level in more than a year. The findings agreed with data earlier in the month on the second-quarter contraction in Germany, the bloc’s biggest economy. Klaus Wohlrabe, an Ifo economist, said his institute expected growth in Germany to be “close to zero” in the third quarter.
A few more headlines on the European economic situation:
The Guardian: An austerity revolt has broken the French government. Will the EU follow?
Bloomberg Businessweek on the European Central Bank, Draghi May Again Find Bazooka Words Beat Action With QE, and an editorial from The Financial Times, Central banks at the crossroads.

Wisteria Flowers in Bloom at Pergola at Portland Japanese Garden Stone Path
Ferguson Stories
Yesterday, on the day of Michael Brown’s funeral, The New York Times published a story that got a great deal of attention because of its insensitive characterization of the dead teenager. Here the paragraph that attracted the angry reaction:
Michael Brown, 18, due to be buried on Monday, was no angel, with public records and interviews with friends and family revealing both problems and promise in his young life. Shortly before his encounter with Officer Wilson, the police say he was caught on a security camera stealing a box of cigars, pushing the clerk of a convenience store into a display case. He lived in a community that had rough patches, and he dabbled in drugs and alcohol. He had taken to rapping in recent months, producing lyrics that were by turns contemplative and vulgar. He got into at least one scuffle with a neighbor.
Would the authors have written a similar paragraph about a white homicide victim? From Vox, The New York Times called Michael Brown “no angel.” Here’s how it described serial killers.
The New York Times’s description of Michael Brown as “no angel” has prompted a swift, critical reaction from other media outlets, including Vox, and various people on social media.
Alison Mitchell, national editor for the Times, defended the term in conversations with the Washington Post’s Erik Wemple:
“It comes out of the opening scene,” says Mitchell, who notes that “like many teenagers,” Brown was indeed “no angel.” Okay, but would the New York Times have chosen this term — which is commonly used to describe miscreants and thugs — if the victim had been white? Mitchell: “I think, actually, we have a nuanced story about the young man and if it had been a white young man in the same exact situation, if that’s where our reporting took us, we would have written it in the same way.” When asked whether she thought that “no angel” was a loaded term in this context, Mitchell said she didn’t believe it was. “The story … talks about both problems and promise,” she notes.
The Times’s response has done little to calm the storm. Sean McElwee, research assistant at Demos, dug into the archives to compare the Times’s description of Brown to the newspaper’s previous descriptions of serial killers and terrorists. Of course, comparing articles produced decades apart by different writers and editors isn’t an exact science. But it does lend context to the widespread frustration over how young black men are portrayed in the media.
A series of McElwee’s tweets are posted at the link, and are well worth reading.
One more from Salon by Joan Walsh, Ferguson’s booming white grievance industry: Fox News, Darren Wilson and friends. Check it out at Salon.
How did this post get so long?! I’d better wrap it up. Please post your thoughts and links in the comment thread, and have a great Tuesday!
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Posted: July 7, 2014 | Author: bostonboomer | Filed under: Barack Obama, morning reads, U.S. Economy, U.S. Politics | Tags: Bill Moyers, child sexual abuse, Constitutional originalism, Down's syndrome in history, E.J. Dionne, economic inequality, Glory Kathurima, Jill Lepore, Joseph Fishkin, Malaika Kathurima, Norfolk NE July 4 parade, oligarchy, pedophile priests, Pope Francis, Racism, Tea Partiers, U.S. Constitution, William E. Forbath |

Good Morning!!
Today is another slow news day, and that could be bad news for some folks in Norfolk, Nebraska. Dakinikat alerted us to the story yesterday, and now it’s in the process of going viral. So far the headlines on the story seem highly understated. From the Lincoln Journal-Star: Obama float at Norfolk parade sparks controversy.
It was the parade float that elicited the loudest cheers Friday at Norfolk’s Fourth of July parade. The crowd lining the streets clapped and laughed as the flatbed truck went by.
But one loud voice rose above the rest: “This is not OK,” Glory Kathurima said. “That’s not OK.”
She kept repeating herself as the float passed, she says. She started to raise her phone to take a picture of the blue truck with the outhouse on its flatbed, along with a dark figurine in overalls propped up by a metal walker.
And nailed to the sides of the wooden privy, two signs in all-black capital letters: “OBAMA PRESIDENTIAL LIBRARY.”
Kathurima’s daughter Malaika saw the disrespectful depiction of the President of the United States, and asked her mom, “Mommy, what does that mean? What’s so funny?”
Kathurima moved to Nebraska from Kenya when she was Malaika’s age and became a naturalized citizen a few years ago. She’s raised her daughter in Norfolk and has found ways to explain the meaning of skin color. She’s turned on the TV and pointed to President Obama, showing Malaika that there was someone that looked like her — half Kenyan, half American.
“I’m angry and I’m scared,” Kathurima said. “This float was not just political; this was absolutely a racial statement.”
If a 9-year-old can see the problem, you’d think the parade organizers in Norfolk would have at least foreseen what the reaction to the float would be from normal people across the country. But apparently they didn’t.

Parade committee member Rick Konopasek said the float wasn’t meant to be any more offensive than a political cartoon would be….
“We don’t feel its right to tell someone what they can and can’t express,” he said. “This was political satire. If we start saying no to certain floats, we might as well not have a parade at all.”
Konopasek and parade announcer Wally Sonnenschein said the outhouse float was the most popular one in the parade, and the three judges awarded it an honorable mention.
“It’s obvious the majority of the community liked it,” Konopasek said. “So should we deny the 95 percent of those that liked it their rights, just for the 5 percent of people who are upset?”
Konopasek and Sonnenschein actually claimed that the float demonstrated the freedom of speech and independence that the country celebrates on the Fourth of July, and that “the man who built the float has been a longstanding member of the community, and people shouldn’t be quick to judge him for expressing his opinions.” How odd then that the “man who built the float” didn’t put his name on his handiwork and he is still anonymous, according to Omaha.com.
A Fourth of July parade float that depicted a figure standing outside an outhouse labeled the “Obama Presidential Library” has created a stir on social media and is also receiving criticism in Norfolk, Nebraska.
The float, in Norfolk’s annual Independence Day parade, was on a flatbed trailer being pulled by a blue pickup truck. The figure was dressed in overalls and standing next to a walker outside of the outhouse. The hands and head of the figure were greenish and appeared to be zombielike; the hands were pressed against the sides of the figure’s head. Miniature American flags were atop the float and on the truck.
Why isn’t “the man who built the float” expressing pride in his creation?
Actually the design of the float wasn’t original. I’ve seen this depiction of Obama before. From Huffington Post:
The presidential library outhouse comparison has become somewhat of a conservative meme in recent years. A similar structure was on display at Montana’s state Republican convention in 2012. And last fall, an outhouse with a “presidential library” sign drew criticism in a small New Mexico town.
It will be interesting to see how this story plays out in the next few days. Certainly if this is not racism per se (I think it is), it demonstrates a shocking lack of respect for the office of the Presidency. Will Norfolk parade officials continue to defend the float? Will “the man who built the float” come forward and defend what he did? Stay tuned.
In other news,
In his latest column, E.J. Dionne calls attention to “an article in draft” by Joseph Fishkin & William E. Forbath called “The Anti-Oligarchy Constitution” (PDF). The article addresses the issue of economic inequality, and is the basis for a planned book by Fishkin.
Dionne writes that Tea Partiers and other “conservatives” constantly talk about the Constitution to justify their extreme views on multiple issues. Dionne argues that “progressives” should “think constitutionally” too, and “challenge conservative claims about what the Constitution really demands.”

In the May issue of the Boston University Law Review, Joseph R. Fishkin and William E. Forbath of the University of Texas School of Law show that at key turning points in our history (the Jacksonian era, the Populist and Progressive moments and the New Deal), opponents of rising inequality made strong arguments “that we cannot keep our constitutional democracy — our republican form of government — without constitutional restraints against oligarchy and a political economy that maintains a broad middle class, accessible to everyone.”
Their article is called “The Anti-Oligarchy Constitution,” though Forbath told me that he and Fishkin may give the book they’re writing on the topic the more upbeat title “The Constitution of Opportunity.” Their view is that by empowering the wealthy in our political system, Supreme Court decisions such as Citizens United directly contradict the Constitution’s central commitment to shared self-rule.
“Extreme concentrations of economic and political power undermine equal opportunity and equal citizenship,” they write. “In this way, oligarchy is incompatible with, and a threat to, the American constitutional scheme.” …. they make a similar critique of what they call an excessively “court-centered” approach to constitutionalism. “Constitutional politics during the 19th and early 20th centuries” was very different and the subject of democratic deliberation. In earlier eras, they say, the Constitution was seen as not simply permitting but actually requiring “affirmative legislation . . . to ensure a wide distribution of opportunity” and to address “the problem of oligarchy in a modern capitalist society.”
The authors remind us of
Franklin Roosevelt’s warning that “the inevitable consequence” of placing “economic and financial control in the hands of the few” would be “the destruction of the base of our form of government.” And writing during the Gilded Age, a time like ours in many ways, the journalist James F. Hudson argued that “imbedded” in the Constitution is “the principle” mandating “the widest distribution among the people, not only of political power, but of the advantages of wealth, education and social influence.”
The idea of a Constitution of Opportunity is both refreshing and relevant. For too long, progressives have allowed conservatives to monopolize claims of fealty to our unifying national document. In fact, those who would battle rising economic inequalities to create a robust middle class should insist that it’s they who are most loyal to the Constitution’s core purpose. Broadly shared well-being is essential to the framers’ promise that “We the people” will be the stewards of our government.
Fishkin’s proposed book sounds like a worthwhile companion to Thomas Picketty’s Capital in the Twenty-First Century.
A somewhat related article from Raw Story by Bill Moyers and Co., July 4th note to tea partiers: Your politics would baffle the Founding Fathers.
Editor’s note: These days, if you see a protester donning a tricorn hat and waving a Gadsden Flag, it’s a safe bet that he or she is a Republican activist who’s furious about “death panels” or the prospect of the government meddling in the Medicare program. But the tea party movement isn’t the first to claim itself to be the true defenders of the Constitution, or to enlist its Framers in a political cause. Throughout American history, activists across the ideological spectrum have insisted that the Framers would roll over in their graves upon encountering the perfidy of their political opponents.
The reality is that the Framers disagreed about almost everything, and produced a Constitution that was filled with expedient compromises. As Jill Lepore, a professor of American history at Harvard University, pointed out in her book, The Whites of Their Eyes: The Tea Party’s Revolution and the Battle Over American History, “Beginning even before it was over, the Revolution has been put to wildly varying political purposes.” Between 1761, when the first signs of discontent with England became apparent in the Colonies, and 1791, when the Bill of Rights was ratified, Lepore wrote that Americans debated an “ocean of ideas” from which “you can fish anything out.”
One of the few areas where the Framers approached a consensus was a belief that their Constitution shouldn’t be fetishized. According to Lepore, it was none other than Thomas Jefferson who wrote, “Some men look at constitutions with sanctimonious reverence, and deem them like the arc of the covenant, too sacred to be touched. They ascribe to the men of the preceding age a wisdom more than human.”
Read an excerpt on Constitutional originalism from Jill Lepore’s book at the Raw Story link.

From NBC News: Pope Francis Meets Abuse Victims, Begs Forgiveness for Church.
The pontiff invited six victims of abuse from Ireland, Germany and Britain to attend an early-morning private Mass at the Domus Sanctae Marthae, the residence next to St. Peter’s Basilica where he lives.
Francis called the abuse a “grave sin” decrying how it was hidden for “so much time” and “camouflaged with a complicity that cannot be explained.”
“I ask for the grace to weep, the grace for the Church to weep and make reparation for her sons and daughters who betrayed their mission, who abused innocent persons,” the pope said in his homily. “I beg your forgiveness, too, for the sins of omission on the part of Church leaders who did not respond adequately to reports of abuse.” ….
Francis strongly praised the victims’ courage in speaking up and shedding “light on a terrible darkness,” telling the mass he is deeply aware of their deep and unrelenting pain.
“Sins of clerical sexual abuse against minors have a toxic effect on faith and hope in God,” he said, adding that the victims’ willingness to come to the Vatican “speaks of the miracle of hope, which prevails against the deepest darkness.”
I guess it’s a start, but I agree with victims advocates who say it’s too little, too late. What concrete actions is the Church going to take to identify abusers and potential abusers before they act out? Child sexual abuse is a systemic problem that has continued for centuries. It’s difficult to see how it can be overcome with apologies and meetings with a few survivors.
I’ll end with a fascinating story from New Scientist, via Raw Story: Oldest case of Down’s syndrome from medieval France.
The oldest confirmed case of Down’s syndrome has been found: the skeleton of a child who died 1500 years ago in early medieval France. According to the archaeologists, the way the child was buried hints that Down’s syndrome was not necessarily stigmatised in the Middle Ages….
The new example comes from a 5th- and 6th-century necropolis near a church in Chalon-sur-Saône in eastern France. Excavations there have uncovered the remains of 94 people, including the skeleton of a young child with a short and broad skull, a flattened skull base and thin cranial bones. These features are common in people with Down’s syndrome, says Maïté Rivollat at the University of Bordeaux in France, who has studied the skeleton with her colleagues….
Oldest case of Down’s syndrome from medieval France – life – 04 July 2014 – New Scientist#.U7qdknlOXEd <!—->
Rivollat’s team has studied the way the child with Down’s syndrome was buried, which hasn’t been possible with other ancient cases of the condition. The child was placed on its back in the tomb, in an east-west orientation with the head at the westward end – in common with all of the dead at the necropolis.
According to Rivollat, this suggests the child was treated no differently in death from other members of the community. That in turn hints that they were not stigmatised while alive.
Another researcher of Down’s Syndrome in ancient history, John Starbuck of Indiana University, says drawing cultural conclusions from the method of burial is very difficult. Read more at the link.
What stories are you following today? Please post your links in the comment thread.
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Posted: June 30, 2014 | Author: bostonboomer | Filed under: Barack Obama, Foreign Affairs, morning reads, U.S. Economy, U.S. Politics | Tags: American Dream, Baby boomers, Blackwater, golden age of capitalism, inequality, joseph stiglitz, plutocrats, polls, post-WWII boom, State Department, Thomas Picketty |

Good Morning!!
Whatever happened to the American dream? Did it ever exist in reality?
We baby boomers can look back to the post-WWII years, when the economy was humming along and the GI Bill made it easier for our dads to get college degrees, find good jobs, buy houses for their families.
In those days, one salary was enough to support a couple and several kids. My dad did it on a college professor’s salary. It was a struggle early on, but those government programs for veterans gave us a push into the professional class.
Eisenhower was President then–a Republican who wouldn’t even recognize his fellow Republican today. Later on, after John Kennedy was murdered and Lyndon Johnson was brought down by the Vietnam War, Richard Nixon presided over the end of the good times. After about 1973, it was over; and since then, wages have essentially remained stagnant.
That was when we entered a new America, in which it took two salaries to support a family. Women went to work, not just because they wanted to, but to keep their families afloat. Children went to day care. So many thing changed. What happened to the American dream? Were those post-war years just an outlier, a brief period of prosperity that meant nothing in the greater scheme of things?
Yesterday, I read a piece by Joseph Stiglitz–in Politico of all places–that addressed some of these questions: The Myth of America’s Golden Age: What growing up in Gary, Indiana taught me about inequality. Stiglitz was born in 1943. Growing up in the industrial “company town” of Gary, he was able to observe the underside of the “golden age” of capitalism–“discrimination, poverty, and bouts of high unemployment.” The big steel companies deliberate brought in desperately poor African Americans from the south in order to keep wages low–to divide and control the work force. Stiglitz writes that he never bought into the notion of the free market as the answer to all ills.
Nearly half a century later, the problem of inequality has reached crisis proportions. John F. Kennedy, in the spirit of optimism that prevailed at the time I was a college student, once declared that a rising tide lifts all boats. It turns out today that almost all of us now are in the same boat—the one that holds the bottom 99 percent. It is a far different boat, one marked by more poverty at the bottom and a hollowing out of the middle class, than the one occupied by the top 1 percent.
Most disturbing is the realization that the American dream–the notion that we are living in the land of opportunity–is a myth. The life chance of a young American today are more dependent on the income and education of his parents than in many other advanced countries, including “old Europe.”

American Dream, by Skip Hunt
Stiglitz points to Thomas Picketty’s research as evidence. Picketty’s work shows that capitalism leads inevitably to inequality. The post-war era of my childhood and early adulthood was an “aberration.”
Today, inequality is growing dramatically again, and the past three decades or so have proved conclusively that one of the major culprits is trickle-down economics—the idea that the government can just step back and if the rich get richer and use their talents and resources to create jobs, everyone will benefit. It just doesn’t work; the historical data now prove that. [….]
Ironically enough, the final proof debunking this very Republican idea of trickle-down economics has come from a Democratic administration. President Barack Obama’s banks-first approach to saving the nation from another Great Depression held that by giving money to the banks (rather than to homeowners who had been preyed upon by the banks), the economy would be saved. The administration poured billions into the banks that had brought the country to the brink of ruin, without setting conditions in return. When the International Monetary Fund and the World Bank engage in a rescue, they virtually always impose requirements to ensure the money is used in the way intended. But here, the government merely expressed the hope that the banks would keep credit, the lifeblood of the economy, flowing. And so the banks shrank lending, and paid their executives megabonuses, even though they had almost destroyed their businesses. Even then, we knew that much of the banks’ profits had been earned not by increasing the efficiency of the economy but by exploitation—through predatory lending, abusive credit-card practices and monopolistic pricing. The full extent of their misdeeds—for instance, the illegal manipulation of key interest rates and foreign exchange, affecting derivatives and mortgages in the amount of hundreds of trillions of dollars—was only just beginning to be fathomed.

American Dream, by Gordon Wendling
I can’t quote any more, but I hope I’ve whetted your appetite enough that you’ll go read the whole thing. While you’re at that link, you might also take a look at this article by “zillionaire” Nick Hanauer, The Pitchforks are Coming for Us Plutocrats. Here’s just a small taste–it’s a long read.
The most ironic thing about rising inequality is how completely unnecessary and self-defeating it is. If we do something about it, if we adjust our policies in the way that, say, Franklin D. Roosevelt did during the Great Depression—so that we help the 99 percent and preempt the revolutionaries and crazies, the ones with the pitchforks—that will be the best thing possible for us rich folks, too. It’s not just that we’ll escape with our lives; it’s that we’ll most certainly get even richer.
The model for us rich guys here should be Henry Ford, who realized that all his autoworkers in Michigan weren’t only cheap labor to be exploited; they were consumers, too. Ford figured that if he raised their wages, to a then-exorbitant $5 a day, they’d be able to afford his Model Ts.
What a great idea. My suggestion to you is: Let’s do it all over again. We’ve got to try something. These idiotic trickle-down policies are destroying my customer base. And yours too.
It’s when I realized this that I decided I had to leave my insulated world of the super-rich and get involved in politics. Not directly, by running for office or becoming one of the big-money billionaires who back candidates in an election. Instead, I wanted to try to change the conversation with ideas—by advancing what my co-author, Eric Liu, and I call “middle-out” economics. It’s the long-overdue rebuttal to the trickle-down economics worldview that has become economic orthodoxy across party lines—and has so screwed the American middle class and our economy generally. Middle-out economics rejects the old misconception that an economy is a perfectly efficient, mechanistic system and embraces the much more accurate idea of an economy as a complex ecosystem made up of real people who are dependent on one another.
Is it possible that because these articles appear in conservative Politico, even a few powerful people in Washington might read them and stop for a moment to think about what what is really happening to America?

American Dream by Matt Sesow
Also in the news today:
NBC NEWS: Yes, Perceptions of Washington Are Even Worse Than Last Year.
This is a six-month report card time, and it’s failing grades for all of Washington. President Obama’s approval rating stands at 41% in our recent NBC/WSJ poll, his fav/unfav is upside down (at 41%-45%), and a majority of Americans (54%) no longer think he’s able to lead the country and get the job done. Republicans and Congress are in even worse shape. The GOP’s fav/unfav in the NBC/WSJ poll is 29%-45% (versus the Democratic Party’s 38%-40% score). Just 7% of the country has confidence in Congress (compared with 29% for the presidency and 30% for the Supreme Court, per Gallup. And when it comes to congressional productivity, the 113th Congress (2013-2014) has passed just 121 bills into law — fewer than at this same point in the historically unproductive 112th Congress (140 bills into law). Maybe it doesn’t FEEL worse, because there hasn’t been an epic showdown or confrontation like the government shutdown. But the numbers tell a different story — it has gotten worse.
From James Risen at the NYT, scary revelations about the murder of 17 civilians by Blackwater thugs in Iraq in 2007: Before Shooting in Iraq, a Warning on Blackwater.
Just weeks before Blackwater guards fatally shot 17 civilians at Baghdad’s Nisour Square in 2007, the State Department began investigating the security contractor’s operations in Iraq. But the inquiry was abandoned after Blackwater’s top manager there issued a threat: “that he could kill” the government’s chief investigator and “no one could or would do anything about it as we were in Iraq,” according to department reports.
American Embassy officials in Baghdad sided with Blackwater rather than the State Department investigators as a dispute over the probe escalated in August 2007, the previously undisclosed documents show. The officials told the investigators that they had disrupted the embassy’s relationship with the security contractor and ordered them to leave the country, according to the reports.
After returning to Washington, the chief investigator wrote a scathing report to State Department officials documenting misconduct by Blackwater employees and warning that lax oversight of the company, which had a contract worth more than $1 billion to protect American diplomats, had created “an environment full of liability and negligence.”
“The management structures in place to manage and monitor our contracts in Iraq have become subservient to the contractors themselves,” the investigator, Jean C. Richter, wrote in an Aug. 31, 2007, memo to State Department officials. “Blackwater contractors saw themselves as above the law,” he said, adding that the “hands off” management resulted in a situation in which “the contractors, instead of Department officials, are in command and in control.”
I have a few more links, but I’m going to put them in comments; because I’m having terrible issues with WordPress today. I hope you’ll also post your thoughts and links in the thread below.
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Posted: May 24, 2014 | Author: bostonboomer | Filed under: Gun Control, income inequality, morning reads, racism, The Bonus Class, U.S. Economy, U.S. Politics | Tags: Chris Giles, Donald Sterling, economic theory, Financial Times., guns, inequality, Kevin Drum, LA Clippers, mass murder, mass shootings, NBA, offshore tax havens, open carry laws, Paul Krugman, Reinhart and Rogoff, Shelly Sterling, Ta-Nehisi Coates, The Case for Reparations, The Economist, Thomas Picketty, wealth distribution, wealth vs. income |

Thomas Picketty
Have a Stupendous Saturday!
It’s too bad Dakinikat is so busy today, because there’s an economics food fight brewing. Perhaps she’ll still find time to comment on the controversy later the evening after she returns home with her newly adopted canine family member, Temple. Meanwhile, I’ll do my best to describe the dispute over Thomas Picketty’s conclusions about wealth inequality, published in his book Capital in the Twenty-first Century.
The Accusations:
At the Financial Times, Economics Editor Chris Giles has claims to have found problems with Picketty’s work: Piketty findings undercut by errors.
Thomas Piketty’s book, ‘Capital in the Twenty-First Century’, has been the publishing sensation of the year. Its thesis of rising inequality tapped into the zeitgeist and electrified the post-financial crisis public policy debate.
But, according to a Financial Times investigation, the rock-star French economist appears to have got his sums wrong.
The data underpinning Professor Piketty’s 577-page tome, which has dominated best-seller lists in recent weeks, contain a series of errors that skew his findings. The FT found mistakes and unexplained entries in his spreadsheets, similar to those which last year undermined the work on public debt and growth of Carmen Reinhart and Kenneth Rogoff.
The central theme of Prof Piketty’s work is that wealth inequalities are heading back up to levels last seen before the first world war. The investigation undercuts this claim, indicating there is little evidence in Prof Piketty’s original sources to bear out the thesis that an increasing share of total wealth is held by the richest few.
Prof Piketty, 43, provides detailed sourcing for his estimates of wealth inequality in Europe and the US over the past 200 years. In his spreadsheets, however, there are transcription errors from the original sources and incorrect formulas. It also appears that some of the data are cherry-picked or constructed without an original source.

John Maynard Keynes
In one specific example, Giles says the corrected data do not show significant growth in Europe since 1970. In a second article, Giles goes into more detail. In addition, he argues that the U.S. data doesn’t support the conclusion that a greater proportion of the wealth is controlled by top 1% than in recent decades. He does admit to the top 10% controlling a greater share of wealth than previously.
An investigation by the Financial Times, however, has revealed many unexplained data entries and errors in the figures underlying some of the book’s key charts.
These are sufficiently serious to undermine Prof Piketty’s claim that the share of wealth owned by the richest in society has been rising and “the reason why wealth today is not as unequally distributed as in the past is simply that not enough time has passed since 1945”.
After referring back to the original data sources, the investigation found numerous mistakes in Prof Piketty’s work: simple fat-finger errors of transcription; suboptimal averaging techniques; multiple unexplained adjustments to the numbers; data entries with no sourcing, unexplained use of different time periods and inconsistent uses of source data….
A second class of problems relates to unexplained alterations of the original source data. Prof Piketty adjusts his own French data on wealth inequality at death to obtain inequality among the living. However, he used a larger adjustment scale for 1910 than for all the other years, without explaining why.
In the UK data, instead of using his source for the wealth of the top 10 per cent population during the 19th century, Prof Piketty inexplicably adds 26 percentage points to the wealth share of the top 1 per cent for 1870 and 28 percentage points for 1810.
A third problem is that when averaging different countries to estimate wealth in Europe, Prof Piketty gives the same weight to Sweden as to France and the UK – even though it only has one-seventh of the population.
Get even more detail and charts here: Data problems with Capital in the 21st Century.

Karl Marx
The Pushback So Far:
Paul Krugman: Is Piketty All Wrong?
Great buzz in the blogosphere over Chris Giles’s attack on Thomas Piketty’s Capital in the 21st Century. Giles finds a few clear errors, although they don’t seem to matter much; more important, he questions some of the assumptions and imputations Piketty uses to deal with gaps in the data and the way he switches sources. Neil Irwin and Justin Wolfers have good discussions of the complaints; Piketty will have to answer these questions in detail, and we’ll see how well he does it.
Krugman suggests that Giles may be doing something wrong.
I don’t know the European evidence too well, but the notion of stable wealth concentration in the United States is at odds with many sources of evidence. Take, for example, the landmark CBO study on the distribution of income; it shows the distribution of income by type, and capital income has become much more concentrated over time:
It’s just not plausible that this increase in the concentration of income from capital doesn’t reflect a more or less comparable increase in the concentration of capital itself….
And there’s also the economic story. In the United States, income inequality has soared since 1980 by any measure you use. Unless the affluent starting saving less than the working class, this rise in income disparity must have led to a rise in wealth disparity over time.
At Mother Jones, Kevin Drum notes that
Giles’ objections are mostly to the data regarding increases in wealth inequality over the past few decades, and the funny thing is that even Piketty never claims that this has changed dramatically. The end result of Giles’ re-analysis of Piketty’s data is [below] with Piketty in blue and Giles in red. As you can see, Piketty estimates a very small increase since 1970.

R.A. at The Economist: A Piketty problem?

Milton Friedman
Mr Giles’s analysis is impressive, and one certainly hopes that further work by Mr Giles, Mr Piketty or others will clarify whether mistakes have been made, how they came to be introduced and what their effects are. Based on the information Mr Giles has provided so far, however, the analysis does not seem to support many of the allegations made by the FT, or the conclusion that the book’s argument is wrong.
There are four important questions raised by the FT‘s work. First, which data are wrong? Second, how did errors in the work, if they are errors, come to be introduced? Third, how do the errors affect the specific points made in the relevant chapters? And fourth, how do the errors affect the fundamental conclusions of the book?
Mr Giles focuses on wealth inequality, to which Mr Piketty turns in Chapter 10 of his book. Mr Piketty has not published nearly as much research on the question of wealth inequality, and it seems that much of the analysis in Chapter 10 was done specifically for the book, based on others’ research. Mr Piketty’s wealth-inequality analysis certainly matters as a component of the book’s argument, but it is not accurate to say, as Mr Giles does, that the results in Chapter 10 constitute the “central theme” of the book.
Are the data wrong? Mr Giles identifies discrepancies between source material cited by Mr Piketty and the figures that appear in the book. He identifies cases in which Mr Piketty appears to have chosen to use data from one source when another would have made more sense. Further, the calculations in Mr Piketty’s spreadsheets (which have been available online since the book’s publication) seem to include adjustments in the data that are not adequately explained, and some figures for which Mr Giles cannot find a documented source. Finally, Mr Piketty has made choices concerning weighting of data used in averages, and assigning of data from one year (1935, for example) to another (1930) when such assignments seem unnecessary or inadvisable.

Alan Greenspan
The author concludes that, unfortunately, ideology will determine how many people respond to the Giles critique. Much more extensive analysis at the link.
Here is Picketty’s–presumably preliminary–response to Giles in a letter to the Financial Times:
Let me also say that I certainly agree that available data sources on wealth are much less systematic than for income. In fact, one of the main reasons why I am in favor of wealth taxation and automatic exchange of bank information is that this would be a way to develop more financial transparency and more reliable sources of information on wealth dynamics (even if the tax was charged at very low rates, which you might agree with).
For the time being, we have to do with what we have, that is, a very diverse and heterogeneous set of data sources on wealth: historical inheritance declarations and estate tax statistics, scarce property and wealth tax data, and household surveys with self-reported data on wealth (with typically a lot of under-reporting at the top). As I make clear in the book, in the on-line appendix, and in the many technical papers I have published on this topic, one needs to make a number of adjustments to the raw data sources so as to make them more homogenous over time and across countries. I have tried in the context of this book to make the most justified choices and arbitrages about data sources and adjustments. I have no doubt that my historical data series can be improved and will be improved in the future (this is why I put everything on line). In fact, the “World Top Incomes Database” (WTID) is set to become a “World Wealth and Income Database” in the coming years, and we will put on-line updated estimates covering more countries. But I would be very surprised if any of the substantive conclusion about the long run evolution of wealth distributions was much affected by these improvements.
I thought this was important:
…my estimates on wealth concentration do not fully take into account offshore wealth, and are likely to err on the low side. I am certainly not trying to make the picture look darker than it it. As I make clear in chapter 12 of my book (see in particular table 12.1-12.2), top wealth holders have apparently been rising a lot faster average wealth in recent decades, at least according to the wealth rankings published in magazines such as Forbes. This is true not only in the US, but also in Britain and at the global level (see attached table). This is not well taken into account by wealth surveys and official statistics, including the recent statistics that were published for Britain. Of course, as I make clear in my book, wealth rankings published by magazines are far from being a perfectly reliable data source. But for the time being, this is what we have, and what we have suggests that the concentration of wealth at the top is rising pretty much everywhere.

In Other News:
There has been a mass shooting in Southern California–this time perpetrated from behind the wheel of a car. From the LA Times, 7 dead in drive-by shooting near UC Santa Barbara.
The shootings began about 9:30 p.m., a sheriff’s spokeswoman told KEYT-TV. It wasn’t clear what the attacker’s motivation might have been.
An 18-year-old Newport Beach man who was visiting Santa Barbara described a confusing scene as the shots rang out.
Nikolaus Becker was eating outside The Habit, 888 Embarcadero Del Norte, near the scene when the first set of shots was fired about 9:30 p.m. At first he thought it was firecrackers. A group of three to five police officers who were nearby started to casually walk toward the sounds, said Becker, but ran when a second round of shots broke out.
“That’s when they yelled at us to get inside and take cover,” Becker said.
The BMW took a sharp turn in front of The Habit, Becker said, and moments later a third round of shots was heard. Becker and his friends moved toward the restaurant’s kitchen but were told to wait in the seating area by employees.
He estimates there were at least 13 to 15 shots total at three locations. The locations were about 100 yards from one another.
The shooter, whose motivation is unknown, was found dead in his BMW. It’s not yet clear if he shot himself or was killed by sheriff’s deputies.
In another gun-related story, TPM reports that some gun nuts are reconsidering their campaign of carrying long guns into public places: Scaring The Crap Out of People Oddly Not Winning Fans.
Earlier this week we reported how Chipotle felt obliged to ask its customers not to bring guns to chipotle restaurants. Seems like a reasonably enough request to most of us. And it’s been preceded by similar requests by various other chains like Starbucks and others.
Now the top pro-gun group in Texas pushing the demand for “open carry” firearm rights and trying to get people to show up at various restaurant chains with long guns is deciding it may not be such a hot idea after all.
Open Carry Texas and a group of other aggressive gun rights groups have issued a joint statement telling their members, Dudes, let’s stop taking our guns to restaurants. It’s freaking people out and making them hate us.
Read the full statement at TPM.

Soon-to-be former LA Clippers owner Donald Sterling has signed over the team to his wife and wants her to negotiate the sale.
Shelly Sterling, who previously shared ownership of the beleaguered NBA franchise with her estranged husband, is now in talks with the NBA over selling the team, the source said.
The NBA banned Donald Sterling for life from all league events after an audio tape became public that caught him on tape uttering racist comments to his assistant V. Stiviano. He told her not to post photos of herself with black people on Instagram — such as Magic Johnson — or bring them to his basketball games.
But the NBA isn’t buying it. From ESPN: Why the NBA won’t allow Shelly Sterling to control the Clippers.
At first glance, Donald Sterling’s gesture may seem like serendipitous news for the NBA. Taking him at his word, Donald Sterling has agreed to leave the league without a fight and has signed off on the sale of his team. Digging deeper, however, reveals possible ulterior motives on Sterling’s part to delay and potentially block the sale of the team. Do not forget a crucial point: capital gain taxes. As first reported by SI.com, the Sterlings have significant incentives under capital gain tax law to avoid the sale of the team and keep it in the Sterling family. Doing so, would save them hundreds of millions of dollars. Also, contrary to some reports, the Sterlings are unlikely to benefit from the “involuntary conversion” tax avoidance provision of the Internal Revenue Code. The bottom line is if the Sterlings have to sell the Clippers, they will probably pay hundreds of millions in state and federal taxes.
Along those lines, Donald Sterling’s proposed maneuver does not accomplish the NBA’s goal of ousting the entire Sterling family on June 3. As explained in a previous SI.com article, the NBA interprets its constitution to mean that ousting Donald Sterling on June 3 would also automatically oust Shelly Sterling as co-owner, with the Clippers then falling under the control of commissioner Adam Silver. Donald Sterling’s proposed maneuver risks the prospect of Shelly Sterling undertaking a slow-moving effort to sell the team. A sale process that takes months or years would clearly aggravate the NBA, which wants to erase the Sterling family name from the league as quickly as possible. A protracted sale of the Clippers by Shelly Sterling might also constitute a potential rationale for players to boycott NBA games.
Even of greater risk to the NBA, what is to stop Shelly Sterling from deciding to keep the Clippers? She could plausibly reason, on various grounds, that now is not the right time to sell the team. Also, her instruction from her husband to sell the team would not be legally binding; it would be a mere suggestion the moment she takes over the team.
Read much more at the link.

Ta-Nehisi Coates
I’ll end with a long article that I haven’t gotten to yet, but I’m hearing it’s a must read: The Case for Reparations, by Ta-Nehisi Coates at The Atlantic. Here’s the tagline:
“Two hundred fifty years of slavery. Ninety years of Jim Crow. Sixty years of separate but equal. Thirty-five years of racist housing policy. Until we reckon with our compounding moral debts, America will never be whole.”
Some reactions:
The Guardian: The ‘Case for Reparations’ is solid, and it’s long past time to make them.
Slate: An Ingenious and Powerful Case for Reparations.
The Wire: You Should Read “The Case for Reparations.”
NPR: How To Tell Who Hasn’t Read The New ‘Atlantic’ Cover Story.
WaPo: Culture change and Ta-Nehisi Coates’s ‘The Case For Reparations’.
What else is happening? As always, please post your links in the comment thread.
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Posted: February 8, 2014 | Author: bostonboomer | Filed under: Foreign Affairs, morning reads, Republican politics, Russia, U.S. Economy, U.S. Politics, Ukraine | Tags: Bosnia-Hertzegovina, First Look, FSB, GCHQ, Glenn Greenwald, Great Britain, Income Inequality, NSA, Paul Volker, seniors, Ukraine |

Tom Wesselman Still Life #30, April 1963
Good Afternoon!!
I thought I’d put the “morning reads” up a little later to give you time to check out JJ’s cartoon posts. So . . . let’s see what’s happening out there today.
Well . . . Paul Volker was in Boston on Thursday night, and he talked to some richie-rich guys about income inequality. From The Boston Globe:
Speaking to a room filled with hundreds of Boston investment executives, former Federal Reserve chairman Paul Volcker asked some tough questions about income inequality in America. He called the earnings gap one of the economy’s greatest challenges.
“What accounts for this? What justifies it?’’ an animated Volcker asked. He argued that the trend started in the 1980s and accelerated in the 1990s, with the spread of stock option compensation creating vast wealth and risk-taking.
During that period, he said, the link between pay and performance got “entirely out of whack.’’
The elder statesman of Fed watchers and author of the Volcker Rule — part of the Dodd-Frank reform package after the financial crisis — was speaking before the Boston Security Analysts Society’s annual market dinner…
Good for him. Whether it will do any good is questionable, but these people need to hear about what they are doing to 99% of Americans.

Just for the hell of it, I looked around for some more recent news articles about income inequality. There wasn’t a lot out there, but I did find a few interesting reads.
At the LA Times, Michael Hiltzik writes: Income inequality begins to hit business in the pocketbook. He argues that business is noticing that middle-class customers are disappearing.
The consumer market is beginning to look like a sandwich without meat in the middle–there are enough wealthy customers to keep the luxury market humming along, and a growing demand for cheap no-name and other bargain products.
The phenomenon has been reported by Matthew Yglesias of Slate.com and more recently by Nelson Schwartz of the New York Times. As we reported here and here, it’s been building for years. But it really picked up steam after the last recession, when the imbalance in income between the top 1% and everyone else has really taken off.
Most economists view the stranglehold of the wealthy on U.S. income and wealth as a problem–it leads to slower overall growth and more volatility. As economist Jared Bernstein has observed, it also promotes the creation of asset and credit bubbles, which have a tendency to burst, taking the rest of the economy with them.
The most important analysis of the economic impact of inequality has come from Barry Z. Cynamon and Steven M. Fazzari of Washington University in St. Louis. In a paper published last month, they ask two questions: “First, did rising inequality contribute in an important way to the unsustainable increase in household leverage that triggered the collapse in consumer demand and the Great Recession? Second, has the rise in inequality become a drag on demand growth…that has held back recovery?”
Their answer to both questions is yes. In simpler terms, rising inequality before the recession prompted U.S. households to borrow more to keep up their spending; when the debt frenzy ended (because of the bursting of the housing bubble) the economy crashed. Since then, the demand drag caused by the effect of inequality on the bottom 95% has held back recovery. The impact of inequality on the recovery, compared with previous recoveries, is shown in this stunning graph from their paper.
But Hiltzik notes that many oblivious pundits continue to deny the effects of the top 1% controlling most of the wealth.

At The News Virginian, Jason Stanford finds some “good news” in the fact that most Republicans now agree that income inequality is a problem.
Believe it or not, there is good news when it comes to income inequality. It turns out Republicans finally believe that the gap between rich and poor has become a problem. The bad news is, according to a new poll, is that Republicans think the best solution is cutting the taxes for the wealthy and big corporations so money and opportunity can rain down on the poor. Addressing poverty by ensuring that cash does not become lonely in the wallets of the wealthy is what passes for a Republican governing philosophy these days, and it is exactly why Barack Obama has decided to go it alone on income inequality.
The issue isn’t that income inequality exists but that the wealthiest 1 percent has achieved the financial equivalent of escape velocity, leaving us poor folk back here on Planet Broke. In 1982, the top 1 percent highest-earning families took home one out of every $10. Now they get more than twice that, leaving the other 99 percent of us to make do on less. The last time it was this bad was the Gilded Age, and majorities of Republicans, Democrats and Independents agree it’s time to do something about it.
OK, so Republicans see the problem, but they want to address it with the same old tired trickle-down non-solutions. I’m not really sure that qualifies as good news. Better than nothing, I guess.
At the Akron Beacon Journal, Rick Armon writes about “an American success story.” Thanks to government programs like Social Security and Medicare, not as many seniors are living in poverty as they did in the past.
Fifty years after President Lyndon Johnson declared the War on Poverty, at least one group of Americans is much better off today: senior citizens.
The percentage of seniors nationwide living below the poverty line has plummeted from 27 percent to 9 percent today, according to a Beacon Journal analysis of census data….
Today, there are 3.7 million seniors living in poverty, compared with 5.2 million in 1969, when the 1970 census was conducted.
The reasons are pretty simple, experts say: It’s a combination of Social Security, pensions, 401(k) programs and Medicare that has kept more elderly people from slipping into poverty.
Armon says those figures may be a little too optimistic (read the details at the link); but still, it’s progress.

Yesterday everyone was talking about Asst. Sec. of State Victoria Nuland’s bugged phone call with the US ambassador to Ukraine in which she uttered the words “fuck the EU,” apparently using an unencrypted cell phone. Someone posted portions of the call to Youtube, and the U.S. has accused Russia of tapping Nuland’s phone. Read all the gossipy details at BBC News.
Of course Russia is accusing the U.S. of “meddling” in the Ukraine crisis. From The New York Times:
KIEV, Ukraine — The tense Russian-American jockeying over the fate of Ukraine escalated on Thursday as a Kremlin official accused Washington of “crudely interfering” in the former Soviet republic, while the Obama administration blamed Moscow for spreading an intercepted private conversation between two American diplomats.
An audiotape of the conversation appeared on the Internet and opened a window into American handling of the political crisis here, as the two diplomats candidly discussed the composition of a possible new government to replace the pro-Russian cabinet of Ukraine’s president, Viktor F. Yanukovych. It also turned the tables on the Obama administration, which has been under fire lately for spying on foreign leaders.
The developments on the eve of the Winter Olympics opening in Sochi, Russia, underscored the increasingly Cold War-style contest for influence here as East and West vie for the favor of a nation of 45 million with historic ties to Moscow but a deep yearning to join the rest of Europe. The tit for tat has been going on since November, when Mr. Yanukovych spurned a trade deal with Europe and accepted a $15 billion loan from Moscow. Months of street protests have threatened his government, and American officials are now trying to broker a settlement — an effort the Kremlin seems determined to block.
There’s a lot more background on the Ukraine situation in the NYT article.

If the problems in Ukraine weren’t enough, anti-government protests have now broken out in Bosnia-Hertzegovina. The Guardian reports:
Thousands of Bosnian protesters took to the streets in the centre of Sarajevo on Friday, setting fire to the presidency building and hurling rocks and stones at police as fury at the country’s political and economic stagnation spread rapidly around the country.
As many as 200 people were injured in protests that took place in about 20 towns and cities. Government buildings were set on fire in three of the largest centres – Sarajevo, Tuzla and Zenica.
At one point in the central Bosnian city of Tuzla, some of the 5,000-strong crowd stormed into a local government building and hurled furniture from the upper stories….
The scenes in Sarajevo were similarly fraught on Friday night, as fire raged through the presidency building and hundreds of people hurled stones, sticks and whatever else they could lay their hands on to feed the blaze. Police used rubber bullets, tear gas and water cannon trying to disperse the crowd. Buildings and cars were also burning in downtown Sarajevo and riot police chased protesters….
The protests have bubbled up out of long-simmering discontent at a sluggish economy, mismanagement, corruption and unemployment, which is rising irresistibly towards 30%. Bosnia has been hamstrung by political infighting and deadlock between its three main ethnic groups – Bosniaks, Croats and Serbs – in the near 20 years since its three-year civil war ended in 1995. The economy has suffered as a result, and the population remains deeply sceptical of a political class widely believed to be ruling in the interests of the elite, not the people.

There continues to be plenty of surveillance news–both about NSA, and more recently about Russia’s intelligence agencies and their security measures activities around the Sochi Winter Olympic Games. This article from The Moscow Times by Andrei Soldatov provides a good overview: FSB Makes Eavesdropping an Olympic Event. In NSA news, Glenn Greenwald and friends have stepped up their publishing activities in the run-up to the unveiling of their First Look news site, planned for Monday. I’ll just share a couple of items with you.
A little more than a week ago Greenwald worked with CBC reporters to “break” a story about alleged spying by Canada’s equivalent of NSA on airport passengers that supposedly continued for days after they left the airport. As usual, the report was deeply flawed, as explained by Matthew Aid, author of The Secret Sentry: The Untold History of the National Security Agency: Analysis Indicates Recent CBC Story About Canadian SIGINT Agency Spying on Travellers Incorrect.
On January 30, the Canadian television channel CBC broke a story written by Greg Weston, Glenn Greenwald and Ryan Gallagher, saying that the Communications Security Establishment Canada (CSEC), which is Canada’s equivalent of NSA, used airport WiFi to track Canadian travellers – something which was claimed to be almost certainly illegal. This story was apperently based upon an internal CSEC presentation (pdf) from May 2012 which is titled “IP Profiling Analytics & Mission Impacts.”
However, as is often the case with many of the stories based on the Snowden-documents, it seems that the original CSEC presentation was incorrectly interpreted and presented by Canadian television.
Read all the gory details at the Aid’s blog.
Then yesterday, Greenwald–in collaboration with NBC News–released a truly bizarre article, Snowden Docs: British Spies Used Sex and ‘Dirty Tricks’, that reveals methods and sources for the GCHQ’s efforts to arrest malicious hackers, criminals, and terrorists, and to prevent nuclear proliferation. You have to wonder why NBC news thought those efforts were somehow wrong or illegal. I’m running out of space, so I’ll let Bob Cesca explain the problems with this story.
There’s one sentence in the new Glenn Greenwald revelation for NBC News that renders everything that follows mostly irrelevant. It’s the lede. And not even the entire lede — just the first part of it.
British spies have developed “dirty tricks” for use against nations, hackers, terror groups, suspected criminals and arms dealers…
The only sane reaction to this news should be, “Great!” We don’t really need to know anything else. But that didn’t stop Greenwald and NBC News from spilling the beans on operations that target such poor helpless victims as malicious hackers, the Taliban, Iran and, yes, terrorists dealing in loose nukes.
See more examples at The Daily Banter. Cesca sums up:
Regardless, what we’re looking at here is another leak from Greenwald & Company that tips off some of our most dangerous enemies including and especially the looming threat of nuclear proliferation and loose nukes. These leaks have been published yet again under the banner of the public interest, but it’s difficult to see any public interest in an operation expressly aimed at those who even the article admits are our “enemies.”
Greenwald has been publishing quite a few leaks about British spying lately. I have to assume that this is his threatened revenge for the Brits detaining David Miranda at Heathrow airport last year. Pretty childish, if you ask me.
Now it’s your turn. What have you been reading and blogging about? Please share your links in the comment thread, and have a terrific weekend!
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