Death by Finance

The US economy is now dying a slow and painful death because it had become based on activities that had nothing to do with producing real wealth. Instead, it became dependent on rackets, that is, behavior geared to getting something for nothing.  These rackets are often summarized under the acronym FIRE for finance, insurance and real estate, a system set up to strip-mine profits from the wish commonly labeled “the American Dream” — itself largely a product of televised advertising and propaganda.  The end product of all that was the doomed economy of suburban sprawl, an infrastructure for daily life with no future in a world defined by fossil fuel scarcity. The unraveling of debt at every level now is directly related to the mis-investments made in that way of life.

James Howard Kunstler  | Clusterfuck Nation

Go Ahead, Congress, Please Make Our Day

Politico is reporting that Congressional Republicans want to force their colleagues in the House and Senate who vote for a public insurance option as part of health care reform to enroll in that public plan when it becomes available.

I think Democrats ought to call their bluff and pledge to be the first to sign up. If they do, they will have to shove me out of line. I would love to have the option of enrolling in a public plan that offers a decent standard benefit package at a more affordable price. I am sick and tired of knowing that only 80 cents of every dollar I pay in premiums to my private insurer goes to pay doctors and hospitals for care they provide. This figure is down from 95 cents in 1993 before the industry came to be dominated by a cartel of hugh for-profit insurance companies like the two I used to work for. I am eager not to have to donate 20 cents of every premium dollar to cover my insurers sales, marketing and underwriting expenses and to help make the CEO and the big institutional investors and Wall Street hedge fund managers even more obscenely rich than they already are, thanks to the inflated premiums we have to pay.

Wendell Potter | CommonDreams.org

Tax the wealthy to keep everyone healthy

Its the most blatant form of Robin-Hood economics ever proposed. The universal healthcare bill reported by the House Tuesday pays for the health insurance of the 20 percent of Americans who need help affording it with a surtax on the richest 1 percent.

I dont recall the last time Congress came up with such a direct redistribution. Occasionally Congress closes a few tax loopholes at the top and offers a refundable tax credit to workers at the bottom, or it creates a poor peoples program like Medicaid, paid for out of general revenues from a progressive income tax. But to say out loud, as the House has just done, that those in our society who can most readily afford it should pay for the health insurance of those who cannot is, well, audacious.

Theres another word for it: fair. According to the most recent data for 2007, the best-off 1 percent of American households take home about 20 percent of total income — the highest percentage since 1928. Yes, I know: Critics will charge that these are the very people who invest, innovate, and hire, and thereby keep the economy going. So raising their taxes will burden the economy and thereby hurt everyone, including those who are supposed to be helped.

But theres no reason to suppose that taking a tiny sliver of the incomes of the top 1 percent will reduce all that much of their ardor to invest, innovate, and hire in the future. Yet if this tiny sliver means affordable healthcare for a far larger number of Americans, who will be able to get regular checkups and thereby stay healthy and productive, the positive effect on the American economy is likely to be far greater.

Robert Reich | Salon

Some Choice Words for the Select Few

According to one poll after another, a majority of Americans not only want a public option in health care, they also think that growing inequality is bad for the country, that corporations have too much power over policy, that money in politics is the root of all evil, that working families and poor communities need and deserve public support if the market system fails to generate shared prosperity.

But when the insiders in Washington have finished tearing worthy intentions apart and devouring flesh from bone, none of these reforms happen. “Oh,” they say, “its all about compromise. All in the nature of the give-and-take-negotiating of a representative democracy.”

That, people, is bull — the basic nutrient of Washingtons high and mighty.

Its not about compromise. Its not about what the public wants. Its about money — the golden ticket to “the select few who actually get it done.”

Bill Moyers and Michael Winship | CommonDreams.org

Rogue Capitalism

Its curious to note that Goldman Sachs has admitted that it has developed trading software that could be used to, in their own words, manipulate markets in unfair ways, yet nobody in the mainstream media has questioned whether Goldman Sachs was / and is using its proprietary trading platform to manipulate markets in unfair ways. Only extremely naive investors with zero understanding of how global stock markets operate would deny that there has been continual and excessive intervention into US stock markets to prop them up over the past several months. —J.S. Kim

Danny Schechter | CommonDreams.org

Unaffordable Empire

I have a suggestion for other countries that are getting a bit weary of the American military presence on their soil: cash in now, before it’s too late. Either up the ante or tell the Americans to go home. I encourage this behavior because I’m convinced that the U.S. Empire of Bases will soon enough bankrupt our country, and so — on the analogy of a financial bubble or a pyramid scheme — if you’re an investor, it’s better to get your money out while you still can.

This is, of course, something that has occurred to the Chinese and other financiers of the American national debt. Only they’re cashing in quietly and slowly in order not to tank the dollar while they’re still holding onto such a bundle of them. Make no mistake, though: whether we’re being bled rapidly or slowly, we are bleeding; and hanging onto our military empire and all the bases that go with it will ultimately spell the end of the United States as we know it.

Count on this, future generations of Americans traveling abroad decades from now won’t find the landscape dotted with near-billion-dollar “embassies.”

Chalmers Johnson | CommonDreams.org

The Global Warming Lie Detector

The economic harm projected from high levels of military spending is far larger than the damage projected from the Waxman-Markey bill. Given this situation, we would have expected that all the oil and coal industry folks, who are now so concerned about the average family’s well-being, would have been screaming about the economic pain that would result from sustaining the Iraq war levels of military spending.

Did anyone ever hear them raise this issue? Does anyone recall members of Congress giving speeches about how the job loss from the Iraq war levels of spending would be devastating? Does anyone recall any newspaper columns or editorials making this point? How about a news story that analyzed the economic impact of higher levels of military spending?

For some reason, job loss and economic pain associated with the military are just not worth mentioning. These items only become newsworthy when the issue is saving the environment. And the elites wonder why the public has so little confidence in the country’s institutions.

Dean Baker | CommonDreams.org

Q Crisis of Masculinity Run Amuck

Everywhere you look these days, someone is making a case for why the latest economic shake up could be a tremendous gift in the long run. No one is pushing that point of view more enthusiastically than feminists, who see a great opportunity for gender equality in these uncertain economic times. The big boys have been humbled and the women emboldened by the financial meltdown. In fact, a new report by the National Council for Research on Women argues that the economic crisis was caused by a perfect storm of things, but was in part, a result of masculinity run amuck.
As controversial as this claim sounds, it’s been made in the most mainstream of places — including in the New York Times, where Nicholas Kristof wondered if we might all be better off if it were “Lehman Brothers and Sisters.” Barnard College president Deborah Spar even went so far as to call it a “one gender crash” in the Washington Post.

Everywhere you look these days, someone is making a case for why the latest economic shake up could be a tremendous gift in the long run. No one is pushing that point of view more enthusiastically than feminists, who see a great opportunity for gender equality in these uncertain economic times. The big boys have been humbled and the women emboldened by the financial meltdown. In fact, a new report by the National Council for Research on Women argues that the economic crisis was caused by a perfect storm of things, but was in part, a result of masculinity run amuck.

As controversial as this claim sounds, it’s been made in the most mainstream of places — including in the New York Times, where Nicholas Kristof wondered if we might all be better off if it were “Lehman Brothers and Sisters.” Barnard College president Deborah Spar even went so far as to call it a “one gender crash” in the Washington Post.

Courtney E. Martin | AlterNet

So What Happened to That Talk About Reining in CEO Pay?

We need to end, and soon, this endless escalation of what our power suits get to stuff in their pockets. We simply can’t afford to continue down the economic road we’ve been traveling.
Outrageously huge rewards, the economic meltdown of the past year has made perfectly plain, have no redeeming social value. They serve only to create incentives for outrageous behavior. We need to start discouraging that behavior – and we can. The best place to start: the federal tax code.
Right now, our tax code actually encourages excessive executive pay. The more companies shell out in executive bonuses and stock awards, for instance, the more they can deduct off their taxes.
We need to end, and soon, this endless escalation of what our power suits get to stuff in their pockets. We simply can’t afford to continue down the economic road we’ve been traveling.
Outrageously huge rewards, the economic meltdown of the past year has made perfectly plain, have no redeeming social value. They serve only to create incentives for outrageous behavior. We need to start discouraging that behavior – and we can. The best place to start: the federal tax code.
Right now, our tax code actually encourages excessive executive pay. The more companies shell out in executive bonuses and stock awards, for instance, the more they can deduct off their taxes.
Chuck Collins | Alternet

Foreclosure Fiasco

It’s not working. The Bush-Obama strategy of throwing trillions at the banks to solve the mortgage crisis is a huge bust. The financial moguls, while tickled pink to have $1.25 trillion in toxic assets covered by the feds, along with hundreds of billions in direct handouts, are not using that money to turn around the free fall in housing foreclosures.

As The Wall Street Journal reported Tuesday, “The Mortgage Bankers Association cut its forecast of home-mortgage lending this year by 27% amid deflating hopes for a boom in refinancing.” The same association said that the total refinancing under the administration’s much ballyhooed Home Affordable Refinance Program is “very low.”

Robert Scheer | CommonDreams.org