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Today's Stories November 12 - 14, 2010 Alexander Cockburn Rannie Amiri Gareth Porter William E. Alberts Jonathan Cook Ramzy Baroud James Zogby Mark Weisbrot Tanya Golash-Boza Paul Wright Martha Rosenberg Celia McAteer Michael Winship Brian McKenna Gerald E. Scorse Christopher Brauchli Roberto Rodriguez J. T. Cassidy Farzana Versey Phil Rockstroh David Swanson Saul Landau
November 11, 2010 Peter Linebaugh Paul Craig Roberts Licensed to Kill Bill Quigley David Macaray Dissing the Boss: the NLRB Files a Landmark Complaint on Free Expression in the Workplace Liaquat Ali Khan / Jasmine Abou-Kassem Dedrick Muhammad Robert Bryce Alan Farago Website of the Day November 10, 2010 Allan Nairn Dean Baker Nicola Nasser Missy Beattie Sergio Ferrari Patrick Cockburn Dave Lindorff Mumia: New Lawyer, New Round Sherwood Ross Joshua Frank Website of the Day November 9, 2010 Uri Avnery Mike Whitney Jordan Flaherty Afshin Rattansi Annie Gell Dean Baker Dave Lindorff Stewart J. Lawrence Walter Brasch Website of the Day November 8, 2010 Paul Craig Roberts Thomas Healy David Swanson David Smith-Ferri Ralph Nader Ray McGovern Torture Sans Regrets: Bush's Confessions John Feffer Christopher Ketcham Website of the Day November 5 - 7, 2010 Alexander Cockburn Vijay Prashad Patrick Cockburn Darwin Bond-Graham
Mike Whitney Linn Washington, Jr. Rannie Amiri Ramzy Baroud Larry Portis Gary Leupp William Loren Katz Brian Cloughley Mark Weisbrot Rubén M. Lo Vuolo, Daniel Raventós / Pablo Yanes Joseph Nevins Neve Gordon Alan Farago Stewart J. Lawrence James R. King Ron Jacobs Franklin Lamb James McEnteer Richard Phelps Saul Landau David Ker Thomson The Long Argument Evelyn Pringle Joseph G. Ramsey Until Pigs Fly: the Morning After With Michael Moore Stanley Heller Missy Beattie Harvey Wasserman Billy Wharton Shamus Cooke Linh Dinh Windy Cooler Charles R. Larson Phyllis Pollack David Yearsley Website of the Weekend November 4, 2010 Doug Peacock Andrew Cockburn Iain Boal Paul Craig Roberts Chase Madar Dave Lindorff Russell Mokhiber Laura Flanders Website of the Day November 3, 2010 Alexander Cockburn Franklin C. Spinney Chris Floyd Dissatisfied Mind: Flickers of Hope in a Deadly Political Cycle William Blum Sheldon Richman Stephen Soldz Mark Weisbrot Stewart J. Lawrence Manuel Garcia, Jr. Election Night in Oakland Norman Solomon Website of the Day November 2, 2010 Vincent Navarro Ishmael Reed Uri Avnery Mark Driscoll Mike Whitney Linh Dinh David Macaray Randall Amster Wikilessons: War is a Joke, But It Isn't Funny Betsy Ross Yves Engler Website of the Day
November 1, 2010 Ted Honderich Steven Higgs John Ross Dean Baker Ralph Nader Justin E. H. Smith Marjorie Cohn Scott Boehm Brian Tierney Trish Kahle Martha Rosenberg Bathrobe Erectus: Feting Hugh Hefner Website of the Day
October 29 - 31, 2010 Alexander Cockburn Joe Bageant Peter Lee David Rosen Mike Whitney David Smith-Ferri Afghanistan: "Is This Normal?" David Macaray Chamber of Horrors: Turbo-Lobbyists for the Ruling Class Rannie Amiri Jonathan Cook Ramzy Baroud Ellen Brown Dr. Nina Pierpont Dave Lindorff Brian Horejsi Daniel Raventós Worldwide Concentration of Wealth: What the Figures Say Richard Anderson-Connolly David Thomson Christopher Brauchli Bob Fitrakis / Harvey Wasserman Charging Rove With Racketeering Roberto Rodriguez Arizona Blues: a Time and Decade of Betrayal Ron Jacobs Farzana Versey Michael Donnelly Gerald E. Scorse John Grant Mickey Z. Charles R. Larson Kim Nicolini Peter Stone Brown David Yearsley Poets' Basement Website of the Weekend
October 28, 2010 Paul Craig Roberts Joseph Grosso Kirkpatrick Sale Michael Winship Sherwood Ross Mark Weisbrot Sam Smith Washington: Where Smart People Go to Do Stupid Things Nicholas Arguimbau Sheldon Richman Franklin Lamb Website of the Day October 27, 2010 Conn Hallinan Michael Schwalbe Dave Lindorff Gareth Porter Dean Baker Clancy Sigal Ram Etwareea Stewart J. Lawrence Alan Farago Binoy Kampmark Offshoring Middle Earth: Prostituting the Hobbit Website of the Day
October 26, 2010 Pam Martens Joann Wypijewski Clarence Lusane Sold Brothers: the Bizarro World of Juan Williams and Clarence Thomas Gareth Porter Stephen Soldz Lawrence Davidson Alan Farago Dean Baker Jerica Arents Gerald E. Scorse Messing with Mankiw: Whining About Taxes and Work Website of the Day
October 25, 2010 Nancy Scheper-Hughes Patrick Cockburn Kathy Kelly Mike Whitney Bill Quigley Winslow T. Wheeler David Macaray Stewart J. Lawrence Ray McGovern Missy Beattie Website of the Day
October 22 - 24, 2010 Alexander Cockburn Lee Ballinger Franklin C. Spinney Rannie Amiri Ralph Nader Laura Carlsen Avi Shlaim Mike Whitney Josh Stieber Kathy Kelly Sasan Fayazmanesh Conn Hallinan Linn Washington, Jr. Christopher Brauchli Mark Weisbrot Stan Cox Ramzy Baroud Dave Lindorff Benjamin Dangl Peter Stone Brown Julie Hilden David Ker Thomson Missy Beattie Suzy Dean Charles M. Young M. Shahid Alam Charles R. Larson David Yearsley Poets' Basement Website of the Weekend October 21, 2010 Diana Johnstone Joanne Mariner Mike Whitney Lawrence Davidson Bill Quigley / Alan Farago David Smith-Ferri Tolu Olorunda Educational Heroes and Myths Website of the Day October 20, 2010 Philippe Marlière Tariq Ali Anthony Pahnke / Mark N. Hoffman David Smith-Ferri Patrick Madden Ishmael Reed Dean Baker Mike Roselle Dave Marsh Pete Redington Website of the Day October 19, 2010 Pam Martens Uri Avnery Ralph Nader Clarence Lusane Sherwood Ross Trudy Bond Sherry Wolf Yves Engler Camilla Fox / Erin McManus Website of Day October 18, 2010 Mike Whitney Jonathan Cook Martha Rosenberg Stewart J. Lawrence P. Sainath James Zogby Ken Cole, Ralph Maughan / Brian Ertz Patrick Brennan Jack Heyman John Grant Website of the Day October 15 - 17, 2010 Alexander Cockburn Slavoj Žižek Paul Craig Roberts Adrienne Pine / Peter Lee Jonathan Cook Bitta Mostofi Franklin Lamb Rannie Amiri Robert Alvarez Joe Paff David Rosen David Correia Sam Hitchmough Ramzy Baroud Dave Lindorff Graham Usher Gary Leupp David Macaray Ron Jacobs Peter Cervantes-Gautschi Lawrence Swaim Linn Washington David Ker Thomson Norman Solomon Michael Dawson John Stanton Jayne Lyn Stahl Paul Buchheit Ziad Abbas Anthony Papa Hardy Jones Missy Beattie Charles R. Larson Peter Stone Brown David Yearsley Poets' Basement Website of the Weekend October 14, 2010 Mike Whitney Jonathan Cook Dean Baker Marjorie Cohn Stewart J. Lawrence Carl Finamore Dave Lindorff Raúl Zibechi Willie L. Pelote Website of the Day October 13, 2010 Vijay Prashad Uri Avnery Dean Baker Winslow T. Wheeler Patrick Bond Michael Winship Myles B. Hoenig Tom Turnipseed Website of the Day October 12, 2010 Ralph Nader Franklin C. Spinney Mike Whitney Robert Alvarez Deepak Tripathi Chris Genovali / Camilla Fox Harvey Wasserman Robert Jensen Mark Weisbrot Charles R. Larson Website of the Day
October 11, 2010 Michael Hudson Bill Quigley Linn Washington Paul Krassner Jonathan Cook Cal Winslow Sherry Wolf Peter Stone Brown David Michael Green Jayne Lyn Stahl Website of the Day October 8 - 10, 2010 Alexander Cockburn Paul Craig Roberts Alain Gresh Patrick Cockburn Rannie Amiri Conn Hallinan Ramzy Baroud Saul Landau Sam Smith Yvonne Ridley Ellen Brown Santwana Dasgupta David Macaray Labor Secretaries: Frances and Elaine Gerald E. Scorse Tony Newman David Ker Thomson Christopher Brauchli Jon Mitchell Kevin Zeese Steven Best Missy Beattie Binoy Kampmark Charles R. Larson Kim Nicolini Dave Marsh David Yearsley Poets' Basement Website of the Weekend
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Weekend Edition Plan From a Parallel UniverseThe Perverse Priorities and Fatal Flaws of the Deficit Commission ReportBy DEAN BAKER The country in which most people live is experiencing an economic disaster. More than 25 million people are unemployed, underemployed, or have given up looking for work altogether. Tens of millions are now underwater on their mortgages, with millions facing the imminent loss of their homes. Furthermore, there is little prospect that the situation will improve anytime soon. Many fewer live in the other America, the world of Wall Street and Washington lobbyists. This is where you’ll find former Wyoming Republican Senator Alan Simpson and investment banker-turned-Clinton Chief of Staff Erskine Bowles, the co-chairs of President Obama’s deficit commission, which on Wednesday outlined its plans for what it calls “fiscal responsibility.” In their world the key fact is that, today, corporate profits are back to their pre-recession peaks. As long as the bonuses on Wall Street are again hitting record highs, the economy must be just fine, so what else is there to do but worry about deficits? It would be hard to understand how ostensibly serious people could be concerned about the deficit right now, unless we realize that they stand apart from the economic calamity that has engulfed most of the country. The suffering caused by this recession simply does not register on their radar screens. This is not just a moral complaint, although it is troubling that the people most responsible for the economic wreckage are doing just fine. More important is that there is no evidence that Simpson, Bowles, and the rest of the deficit cutters have the slightest understanding of the economy. If they did they would be looking at the deficit in a completely different way. First, the current deficit should not even be viewed as a problem. Yes, a deficit of $1.4 trillion is big, but this is a direct result of the loss of demand stemming from the collapse of an $8 trillion housing bubble. This bubble was driving the economy until its collapse. There were two channels through which the bubble generated demand in the economy: bubble-inflated house prices led to a boom in construction, bubble-inflated wealth led consumers to increase their spending, pushing saving rates to almost zero. This demand has disappeared now that the bubble has deflated. The economy has lost more than $600 billion in annual construction demand as builders cut back in response to an enormous over-supply of both residential and non-residential property. Similarly, consumption has plummeted. This left an enormous gap in demand that, at least in the near-term, can only be filled by the government. If the government were to spend less—say it instantly balanced its budget—the primary result would be a further decline in demand and more job loss. We are in a peculiar situation where the main problem for the economy is a lack of demand. More demand will mean more growth and more jobs. Government must supply demand because there is no other entity that can step forward to do it—unless someone gets very good at counterfeiting hundred dollar bills. The failure to understand current deficits also leads to a misunderstanding of the debt burden. Simpson and Bowles raise fears of an exploding debt reaching 90 percent of GDP by the end of the decade. They have raised the prospect of a crushing interest burden facing future generations of taxpayers. Simpson and Bowles decided to include cuts to Social Security in the mix, even though Social Security has not contributed to the deficit. But there is no real basis for this concern. There is no reason that the Fed can’t just buy this debt (as it is largely doing) and hold it indefinitely. If the Fed holds the debt, there is no interest burden for future taxpayers. The Fed refunds its interest earnings to the Treasury every year. Last year the Fed refunded almost $80 billion in interest to the Treasury, nearly 40 percent of the country’s net interest burden. And the Fed has other tools to ensure that the expansion of the monetary base required to purchase the debt does not lead to inflation. This means that the country really has no near-term or even mid-term deficit problem. The current deficit is a positive. In fact, if it were larger we would have more jobs and growth. Furthermore, there is no reason that the debt being accumulated at present should pose any interest burden on future generations. In this vein, it is worth noting that Japan’s central bank holds debt amounting to almost 100 percent of that country’s GDP. As a result, Japan’s interest burden is considerably smaller than the United States’s, even though Japan’s debt is almost four times as large relative to the size of its economy. Over the longer term the United States is projected to face a deficit problem, but this is almost entirely attributable to the explosive rate at which private-sector health-care costs are likely to grow. More than half of health-care costs are paid by the government, hence the public budgetary impact of our private system. Of course, those increasing costs will lead to enormous problems for the private sector, too. Rapidly rising health-care costs were a big part of the GM and Chrysler bankruptcies. If per-person health-care costs in the United States were the same as in Canada, then General Motors’ profits would have been $20 billion higher over the last decade. If, on the other hand, health-care costs follow the projected path, we will have many more General Motors and Chryslers. Simpson and Bowles’s report seeks saving in public-sector health programs, primarily by making patients pay more for care. But there is no discussion of the private health-care system that is the root of the problem. To no one’s surprise the co-chairs decided to include cuts to Social Security in the mix, even though Social Security has not contributed to the deficit. The program has a designated payroll tax and is prohibited from spending beyond the money provided by the tax. It is structurally impossible for the program to affect the deficit. The Simpson-Bowles approach involves raising the retirement age, cutting benefits for middle- and higher-income workers, and reducing the annual cost-of-living adjustment so that retirees would no longer see their benefits rise in step with the consumer price index (CPI). Raising the retirement age seems more than a bit unfair, since most of the gains in life expectancy have been going to workers in the top half of the income distribution. Workers in the bottom half have seen minimal gains in life expectancy over the last three decades. The cuts in the benefit formula will hit anyone who has average wage earnings over their lifetime of more than $36,000. This is not most people’s definition of affluent. Simpson and Bowles do not seem interested in accuracy; they want to cut benefits. Finally, the co-chairs want to peg the cost-of-living adjustment to a new CPI that regularly shows a lower rate of inflation than the current measure. The gap is about 0.3 percent, which means that benefits will rise by about 0.3 percent less rapidly than would otherwise be the case. This effect seems small, but it adds up over time. A retiree who collecting benefits for ten years would have a benefit in their tenth years that was 3.0 percent lower than would otherwise be the case. After 20 years the gap would be 6.0 percent and after thirty years the gap would be 9.0 percent. This policy has the effect of hitting the oldest hardest. These are precisely the people (mostly women) with the least resources. It is often argued that the new CPI would be a better measure of inflation, but if we are concerned about actually measuring the cost of living for retirees, Simpson and Bowles could have recommended that Congress use a measure constructed by the Bureau of Labor Statistics explicitly to measure the increase in the cost of living for the elderly. This CPI for the elderly consistently shows a rate of inflation that is 0.2-0.4 above the standard CPI that is used now. But Simpson and Bowles do not seem interested in accuracy; they want to cut benefits. There is one item worth noting for its absence. Simpson and Bowles apparently never considered a Wall Street financial-speculation tax. This is an obvious source of revenue that even the International Monetary Fund is now advocating in recognition of the enormous amount of waste and rents in the financial sector. It is possible to raise large amounts of revenue from such a tax. University of Massachusetts professor Robert Pollin and I calculated the potential revenue at more than $100 billion a year, with little impact on productive economic activity. The main impact would be to reduce the shuffling of financial assets. The refusal to consider this source of revenue is striking since at least one member of the commission has been a vocal advocate of financial-speculation taxes. Bowles is a director of Morgan Stanley, one of the Wall Street banks that would be seriously affected by such a tax. There are some positive items in the report. It would limit the mortgage interest-rate deduction and get rid of the deduction for “cafeteria” benefit plans. But the report is fatally flawed because its authors, principally Simpson and Bowles, never seriously reflected on their basic economic assumptions. It would be best if this is yet another one of those Washington commissions that is quickly forgotten. Dean Baker is the co-director of the Center for Economic and Policy Research (CEPR). He is the author of Plunder and Blunder: The Rise and Fall of the Bubble Economy and False Profits: Recoverying From the Bubble Economy. This column was originally published by Boston Review.
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