200 Years Ago, We Didn't Have To Explain "Where Money Comes From" To All Citizens. More Knew Then Than Do Now!

   (Commentary posted by Roger Erickson)

Battle Over Banking: A Public Bank for the Republic of Vermont (1803)

The first part is is a fascinating historical story, for multiple reasons. 

First, for the mere fact that a savvy set of state legislators had it right from the beginning, like multiple American Colonies had done, previously. 

(Just like John Law had pointed out. Maybe he could read some Greek?)

Second, for the chilling story of how widespread bank monopolies conspired to do away with the Public Bank of Vermont.

Nothing much changes? The bank lobby is still winning, so far. Keeping us from further coordinating our own returns.

James Mackenzie — Pope Francis attacks ‘throw-away’ economic globalization

Pope Francis launched a fresh attack on economic injustice on Saturday, condemning the “throw-away culture” of globalization and calling for new ways of thinking about poverty, welfare, employment and society. 

In a speech to the association of Italian cooperative movements, he pointed to the “dizzying rise in unemployment” and the problems that existing welfare systems had in meeting healthcare needs. 

For those living “at the existential margins” the current social and political system “seems fatally destined to suffocate hope and increase risks and threats,” he said.
The Argentinian-born pope, who has often criticized orthodox market economics for fostering unfairness and inequality, said people were forced to work long hours, sometimes in the black economy, for a few hundred euros a month because they were seen as easily replaceable. 

“‘You don’t like it? Go home then’. What can you do in a world that works like this? Because there’s a queue of people looking for work. If you don’t like it, someone else will,” he said in an unscripted change from the text of his speech. 

“It’s hunger, hunger that makes us accept what they give us,” he said..

“When money becomes an idol, it commands the choices of man. And thus it ruins man and condemns him. It makes him a slave,” he said. 

“Money at the service of life can be managed in the right way by cooperatives, on condition that it is a real cooperative where capital does not have command over men but men over capital,” he said [addressing the cooperative movement].

One America News Network
Pope Francis attacks ‘throw-away’ economic globalization

James Mackenzie

Al Jazeera — India promises economy to 'take off' with new budget

One picture is worth a thousand words.

Al Jazeera
India promises economy to 'take off' with new budget

AP

Also

Revenue expenditure includes items that do not create any assets including salaries, interest payments, and subsidies. Capital expenditure includes items that create assets such as schools, roads and other infrastructure or repayment of loans. It is the capital expenditure where this budget has clearly stepped up.... 

In summary, the government is stepping on the gas on capital expenditure and on capital receipts. The plan is to build India’s future assets by monetising [privatizing] existing ones. Onward to execution now.

Quartz
The two numbers that really matter in Narendra Modi’s first full budget
Pranav Kumar

Quartz
Here’s what India Inc. has to gain from Narendra Modi’s budget
Nand Kishore

Tomas Hirst — The Greek government is calling for a radical new 'basic income' welfare policy

Well, not a universal BIG.

In the case of Greece it looks like such a scheme would initially be targeted at those nearing pension age in order to prevent them from taking early retirement — providing them with an income that they would otherwise draw from the state pension fund.

What Greece obviously needs with its depression level unemployment and forced austerity is a job guarantee and safety net for those unable to work.

Business Insider
The Greek government is calling for a radical new 'basic income' welfare policy
Tomas Hirst

Mark Ames — Meet Pierre Omidyar! A handy primer for new First Look hires

Mark Ames investigates Pierre Omidyar and the investigative reporters he hired. Ouch. Serious smackdown.

Pando Daily

Meet Pierre Omidyar! A handy primer for new First Look hires
Mark Ames

Sandwichman — Labour Defended Against the Claims of "Human Capital"

Thomas Hodgskin and Karl Marx versus Gary Becker on "human capital."

Econsopeak
Labour Defended Against the Claims of "Human Capital"Sandwichman

Jan Kregel — Europe At The Crossroads – Financial Fragility And The Survival Of The Single Currency

To outside observers, Germany's insistence that the new Greek government continue to impose austerity policies in the presence of rising unemployment and mounting debt levels appears to defy economic logic. However, an acquaintance with the historical evolution of the path to the creation of the common currency in the European Union (EU) sheds some light on the logic of the German government's strategy in dealing with the eurozone sovereign debt crisis and its negative response to Greece's request for an alternative economic policy.

Given the continuing divergence between progress in the monetary field and political integration in the euro area, the German interest in imposing austerity may be seen as representing an attempt to achieve, de facto, accelerated progress toward political union; progress that has long been regarded by Germany as a precondition for the success of monetary unification in the form of the common currency. 

Yet no matter how necessary these austerity policies may appear in the context of the slow and incomplete political integration in Europe, these policies are ultimately unsustainable.

The survival and stability of the euro, in the absence of further progress in political unification, paradoxically require either sustained economic stagnation or the maintenance of what Hyman Minsky would have recognized as a Ponzi scheme. Neither of these alternatives is economically or politically sustainable.

Levy Economics Institute of Bard College
Europe At The Crossroads – Financial Fragility And The Survival Of The Single Currency
Jan Kregel | Senior Scholar

Note: Paragraphing changed for ease of reading online.

Branko Milanovic — What remains of Pareto?

My class on personal income distribution theories (within-nations) begins with Pareto. Pareto will indeed be for ever part of such classes because he was the first economist to have been seriously interested in empirical analysis of inter-personal inequality. Before him, economics was about functional income distribution which, of course, makes sense if you assume that all workers are at subsistence, all capitalists rich, and all landlords even richer. Then, you do not need to bother with inter-personal inequality. It is just a transformation of factoral income distribution. (This is, I think, most obvious in Ricardo who cannot even conceive of a possibility of wages ever going above subsistence—except temporarily to precipitate the Malthusian movement. The advantage for modeling—since Ricardo’s “Principles” are in reality an exercise in verbal modelling—is that you have one fixed quantity and you can then let others vary).

It is just a minor simplification to say that Pareto thought that there was an iron law of income distribution, namely that inequality did not change whatever social system was in power. It gave consistency to his theory of the circulation of the elites, because whatever elite be in power (land-owning, capitalist or bureaucratic), income distribution would be the same although the people who would be rich or poor would be different. It was a serious critique of the idea that Marxist socialism would reduce income inequalities. 

What remains of Pareto’s claim? Several things are clear now--more than a century after Pareto defined his power low and showed that the number of recipients of a given income decreases in proportion as that income threshold is raised. Pareto law does not apply to any entire distribution.

Global Inequality
What remains of Pareto?
Branko Milanovic | Visiting Presidential Professor at City University of New York Graduate Center and senior scholar at the Luxembourg Income Study (LIS), and formerly lead economist in the World Bank's research department and senior associate at Carnegie Endowment for International Peace

Kenneth Thomas — EU goes to WTO over Boeing subsidies

Just as I predicted, the European Union has filed a World Trade Organization complaint against Boeing's new round of subsidies from Washington state totaling $8.7 billion from 2025 to 2040 (h/t @ThomasCafcas). I'll go out on a limb and predict that the EU will win this case. 

Okay, that's not really out on a limb: The WTO found that Boeing's last round of state and local subsidies violates its Agreement on Subsidies and Countervailing Measures, and the facts are exactly the same -- except for the fact that the subsidies have grown from $160 million a year to $543 million a year, more than three times as much. This case is a slam-dunk

Of course, after it loses, it's not like Washington state will comply with the ruling. It's not complying with the last ruling. But it gives us an opportunity to remember that Boeing embodies everything that's wrong with corporate America....

Middle Class Political Economist
EU goes to WTO over Boeing subsidies
Kenneth Thomas | Professor of Political Science at the University of Missouri-St. Louis

The Saker — Good news out of Russia – even the “non-system” opposition refuses to blame the Kremlin

Honestly, I never thought the day would come where I would have anything good to say about the Russian “liberal” or “democratic” “non-system” opposition but apparently this day has come today. To my surprise, all the leaders of this opposition have so far made very moderate and reasonable statement and all those which I have heard have apparently dismissed the notion that the Kremlin was behind the murder [of Boris Nemstsov]. Now this might be self-evident for most of us, but for the Russian “liberal” or “democratic” “non-system” opposition this is quite a change of tone.  Many have even said that this murder was a “provocation” (which in this context means “false flag”!) to destabilize Russia and create a crisis.  Even Irina Khakamada, normally a real crackpot, has said that this was either a “provocation” or the action of a small group of extremists....

The Vineyard of the Saker
Good news out of Russia – even the “non-system” opposition refuses to blame the Kremlin
The Saker

Steve Keen — What Is Money And How Is It Created?

 Augusto Graziani, an Italian Professor of Economics, who died early last year ... understood what money is because he posed and correctly answered a simple question: how does a monetary economy differ from one in which trade occurs by barter?

Forbes
What Is Money And How Is It Created?
Steve Keen

Robert Paul Wolff — Human Capital

Enter Gary Becker, who resurrected the concept of "human capital" to take account not of the worker's body or her food and clothing but rather to incorporate into Economic Theory the important fact that in a modern capitalist economy, some categories of workers regularly earn wages significantly higher than the standard pay for semi-skilled machine operatives, as a consequence of their educational credentials and the skills supposedly thereby represented. These workers, it is suggested, have invested in themselves by holding themselves off the labor market while they acquire further education, often at considerable expense, thereby accumulating "human capital." . They are thus like business owners who use a portion of their profits [or take loans] to purchase more sophisticated machinery, the cost of which, amortized over the life of the machines, is a good deal less than the market value of the additional product churned out by the improved capital goods. 

This modern version of the old notion of human capital allows economists to blame the low wages of unskilled workers on their own improvident failure to invest rather than consume, an interpretation of poverty that is quite comforting to those sitting atop piles of accumulated capital. 

But the analytical concept of human capital has other interesting uses in our attempts to understand modern capitalism, which exhibits a segmented and highly pyramidal wage structure. It can, for example, be deployed to make sense of the notion of relative exploitation. High wage workers can be understood as both exploited by their employers and exploiting lower wage workers, a construal that seems to comport with our intuitive sense that corporate executives, lawyers, professors, and such like high wage employees occupy a social position more akin to the owners of capital than to hourly wage earners at the bottom of the income pyramid.

The Philosopher's Stone

Human Capital

Robert Paul Wolff | American political philosopher[ and professor emeritus at the University of Massachusetts Amherst

Michał Kacewicz — A Final Interview With Boris Nemtsov

Thought experiment" As you are reading this, replace "Russia" with the United States, "Putin" with the sitting US president as unitary executive, "inferiority complex" with "superiority complex." Is what Boris Nemtsov alleged is happening in Russia bear any relation to the US war hawks, neocons, military-industrial-congressional complex, and deep state.

Does this bear any resemblance to Saddam and the the lead up to the Iraq war?

Collision course developing.

Newsweek
A Final Interview With Boris Nemtsov
Michał Kacewicz

Russia no longer requires $100 oil to balance its Fiat? - For Pete's Sake!

   (Commentary posted by Roger Erickson)

They don't sleep. They never sleep!

Do you ever feel like you're surrounded by the propaganda?

You might be reading a news story about a completely obvious reality, when right in the middle of it, TINA'S LINE comes crawling out, to kill any relevance to the real world.

"Russia no longer requires $100 oil to balance its budget"

What? Balance fiat? WTF? Again?

Where did that come from? Is there any way to stop it? Are we fatally infected?

There's got to be some way to stop this auto-loop from endlessly scrolling across our Kabuki screens. Otherwise, the implication is that we'll all die, with a horrific look of fiat frozen on our aggregate faces.

What's the solution? Turn off the set? Cancel the subscriptions? Talk to real people, about real stuff?

I know, that's crazy talk. Right?

When fiat balances.  Is that like when time stands still?

Vermont Radio Live Interview With Sibel Edmonds, Similarities of Black-Ops & Orthodox MacroEconomics

(Commentary posted by Roger Erickson)


It's about money, lots of money, and who gets to touch it (not us).

Every flavor of orthodoxy is just another tool in the great game?

For those of you worried about the utility of our policy landscape, and trying to tell the difference between Clapper and Putin, or black-ops versus orthodox macroeconomics, you might want to hear this interview Monday, March 2, on Vermont Public Radio, by host Jim Hogue, who has interviewed both Bill Black of UMKC and Birgitta Jonsdottir, a prosecutor of Iceland's banksters.

Sibel Edmonds on her expose "Classified Woman" and subsequent novel "The Lone Gladio"

Another interesting review of Gladio is found here.

Upcoming Sibel Edmonds interview: Monday, March 2nd, at 1:00 PM, LiveStream

www.wgdr.org


For more background, here's text of a prior interview with Edmonds, 11 years back.

Transcript of 2004 Interview with Sibel Edmonds

John Pilger — Why the rise of fascism is again the issue

No, it's not about the rise of far right groups and parties.

The new fascism is Anglo-American neoliberalism.

Since 1945, more than a third of the membership of the United Nations - 69 countries - have suffered some or all of the following at the hands of America's modern fascism. They have been invaded, their governments overthrown, their popular movements suppressed, their elections subverted, their people bombed and their economies stripped of all protection, their societies subjected to a crippling siege known as "sanctions". The British historian Mark Curtis estimates the death toll in the millions. In every case, a big lie was deployed....

Uniting fascism old and new is the cult of superiority. "I believe in American exceptionalism with every fibre of my being," said Obama, evoking declarations of national fetishism from the 1930s. As the historian Alfred W. McCoy has pointed out, it was the Hitler devotee, Carl Schmitt, who said, "The sovereign is he who decides the exception." This sums up Americanism, the world's dominant ideology. That it remains unrecognised as a predatory ideology is the achievement of an equally unrecognised brainwashing. Insidious, undeclared, presented wittily as enlightenment on the march, its conceit insinuates western culture.

"American exceptionalism" was initially a phrase to describe America's different history and meteoric rise owing to the frontier that allowed it to expand hugely and quickly in while most of the rest of the world land was already distributed. Of course, this overlooks the fact that much of the territory was already in use by indigenous tribes and nations.

However, "American exceptionalism" later came to mean that God had especially favored America as his "chosen people" giving it a very different sense, not all that different from the semi-religous Nazi teaching of "Aryan superiority."

John Pilger
Why the rise of fascism is again the issue

See also

Truthdig
The Real American Exceptionalism

Alfred W. McCoy, TomDispatch

Cooperation with China on joint assessment of the impermissibility of meddling in other countries’ affairs is a major stabilizing factor in the current international situation

TASS

Russia and China advance new global order — Russian foreign minister

Ian Welsh — The Problem with Basic Income

So basic income, at any level that would be equivalent to a living wage (aka. letting people live a decent life, not just barely scrape by), can be expected to spike inflation in various commodities, including oil. This is a problem, but it’s not a huge problem, because we finally have the technology which allows us to move off oil (not completely, but enough to mitigate the effect of demand increases), and because, hey, we’re flirting with deflation anyway. 

The real problem with basic income has to do with who controls our economy—with the fact that we are sold what we need, by and large, by oligopolies.... 

What this means is that increases in income, especially at the lower end, tend to be simply taken away by those who have what you must have. Everyone will know what the basic income is, and they will know who is surviving on just that, or just that plus a low-wage job. And they will raise prices so that money goes to them.... 

So if you want basic income to work, you must also make capitalism work. You must create actual competitive markets, you must-trust bust, you must regulate and you must move, as government, to ensure that the important things people will spend that basic income on are not scarce—either naturally or artificially.This extends far beyond basic income. 

Good post. Read the whole thing if you are into basic income.

Ian Welsh
The Problem with Basic Income

herrnaphta — Marxism and Monetary Theory: A Bibliography

Since reading David Graeber’s Debt last fall, I’ve become interested in the relationship between Marxist economic theory and the heterodox theory of money Graeber supports in his work. Graeber holds to a chartalist position, which argues that money is not, as the classic account in Carl Menger goes, simply the most salable commodity, but rather a symbol that has value because the state requires us to pay taxes in it. Though this theory of money dates back to Aristotle, today it has been developed into the body of theory known as ‘Modern Monetary Theory.’ 

MMT’s focus on the role of the state in making money gives it a very different emphasis from Marx’s analysis in the first three chapters of Capital. There, Marx argues for something quite similar to Menger, drawing an account of the way that a society based on commodity production has need for one commodity to serve as a universal equivalent. In other words, monetary theory appears to make for strange bedfellows. On one side, we have the neo-classicals, the Austrians, and Marx. On the other, the left-leaning post-Keynesians. What to make of all this? 

Personally, I’m pulled by the arguments of MMT. As I began researching what Marxists had to say on the subject, I was relieved to find a number of them arguing that value theory does not require commodity money, and that Marx himself in the later volumes of Capital appears to recognize this....

Marxist Marginalia
Marxism and Monetary Theory: A Bibliography
herrnaphta
h/t Rodger Mitchell at Chartalism

John Helmer — What Is Russia’s Answer To Greece’s Plan B — Smile, Blow The Whistle, Pass The Red Card

Stalin’s decision not to contest Greece with the Americans, and the calculation in Moscow at the time of higher priority state interests have been well documented. Less well-known is the calculation of the last Soviet Politburo in 1989, then ruled by Mikhail Gorbachev: he decided not to come to the aid of Prime Minister Andreas Papandreou, who requested assistance ahead of the parliamentary election of June 1989. Papandreou lost that election. 

The calculation this time round is unchanged. The new Prime Minister, Alexis Tsipras, is viewed in Moscow as a closet American.

Dances with Bears

What Is Russia’s Answer To Greece’s Plan B — Smile, Blow The Whistle, Pass The Red Card

John Helmer

Michael Stephens — The Greek Debt Problem and Selective Historical Memory

Michalis Nikiforos, Dimitri Papadimitriou, and Gennaro Zezza, who put together the Levy Institute’s stock-flow consistent macroeconomic model and simulationsfor Greece, have just released a new policy note, the upshot of which is that restructuring Greece’s unsustainable public debt is a necessary but not sufficient condition for a sustained economic recovery in that country. They also point to an interesting historical precedent that ought to inform the ongoing discussion of Greece’s debt and the conditions imposed by its official creditors.

The troika’s official story—about how Greece’s debt-to-GDP ratio will be brought down from its current 175 percent to 120 percent by 2022—is, as the authors put it, “wildly implausible.”....

Multiplier Effect
The Greek Debt Problem and Selective Historical Memory
Michael Stephens

Geoff Coventry — When good analogies go bad

We've all heard it.

"If I ran my business like the government I'd be bankrupt".

It sounds so intuitive; so moral. It would be irresponsible for a government to keep spending more than is earns. And for many governments, it really is true - all those cities, states, and the nations that do not issue their own currency (like Greece). Yep - they all have to get the money they spend because they are all users of a currency.
But what about nations that issue their own currency? After-all, that's most sovereign nations.

Let's go back to our analogy. We said if I ran my business like the government... stop right there. What business issues its own money? Businesses are currency users just like cities, but the United States is a currency issuer. In what way can a business ever run like a currency issuer? 

Yep, some analogies are just bad. So bad, in fact, that they can mislead whole nations into thinking something false is true, and something true is false. Or, to put it in moral terms, they lead us to believe that something very destructive to our economy is actually the only righteous solution, and that the very thing that could help society and people is deemed irresponsible and even evil.

That's what happens when good analogies go bad....

It's the people's money
When good analogies go bad
Geoff Coventry

Bill Mitchell — The superiority of economists!

Its the Friday lay day blog and today I briefly discuss economists. What a topic! There is an interesting article just published in the Journal of Economic Perspectives that examines the way economists think of themselves and other social science disciplines. It is a horror story really. Having been immersed in the profession for many years now, I sometimes forget how bad it is. Here is what the study found. The title is a deliberate double entendre. It is more about the way economists think they are superior rather than any absolute finding of superiority....

Smackdown follows.

Bill Mitchell – billy blog
The superiority of economists!
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at the Charles Darwin University, Northern Territory, Australia

Peter Cooper — What is Modern Money?

A modern money system, as that term is applied in Modern Monetary Theory, typically has three key features. Two of these features are always present. The third is optional but normally should be in place for the full benefits of modern money to be enjoyed: 

1. The currency is a public monopoly. Government issues the currency and is the only entity allowed to do so. 

2. The currency is nonconvertible. It is a fiat currency. The government does not promise to convert its currency into a precious metal or some other commodity at a set price. 

3. The exchange rate is allowed to float. The government does not promise to maintain a fixed exchange rate with any foreign currency. Instead, the exchange rate is ‘flexible’ or ‘floating’. As already mentioned, this feature is usually operative, but not always. 

Taking these three features together, we can say that modern money normally involves a ‘flexible-exchange-rate nonconvertible currency’, or ‘flex-rate currency’ for short....

heteconomist
What is Modern Money?
Peter Cooper

Price of Olive Oil

Screen capture of current price at US Costco for 6L of Greek Olive oil at $60.00 for 6L:

If this represented the only trade between the US and Greece; and the Greeks re-established the drachma and set the initial exchange rate at 1 USD to 1 drachma.

If the Greek olive producers immediately faced reduced price competition in the US market, and reduced the price of this oil to the US market from $10/L to $9/L in order to maintain share, then the "exchange rate" would proceed directly to $.90 to 1 drachma; the drachma would be "devalued" by 10% (to USD).

It would not matter how many forex traders were long or short, or short or long, blah, blah....  or what M1 was or M2 or M16, "base money", blah, blah...... before these REAL events would transpire in this agricultural market and move the "exchange rate" in the banking system.

Darkside Of European Union's Freedom Of Movement

(Commentary posted by Roger Erickson)

Young Spaniards moving to Germany get trapped in dismal jobs

"This is the downside of the European Union's freedom of movement ... Other countries pay for the education of these people and then German companies bring them here to exploit them."

That is rather reminiscent of the strategy behind sharecropping. Freedom of Teilpächten?

"I owe my soul to the [bankers] store."

Simon Wren-Lewis — Can helicopter money be democratic?

Simon Wren-Lewis asks the fundamental question.

Helicopter money is by definition central bank policy. Can that be democratic is the central bank is to remain politically independent? It would seem not.

Moreover, helicopter money is fiscal. It increases the net financial assets of non-government whereas

Mainly Macro
Can helicopter money be democratic?
Simon Wren-Lewis | Professor of Economics, Oxford University

Updates on a couple of students who took my Forex course

Good news to report folks, I just got some emails from a couple of students who took my Forex course and they gave me an update on their progress.

One student, who took the course earlier this month is up 4.0%. He also told me that he was able to successfully work out of a difficult position that initially had shown some losses. He kept his cool, employed the technicques that I taught and turned things around.

The other student took the course last April and he is up 40%. Not bad.

Both were complete Forex trading novices coming into the class.

J.D. Alt — The Millennials’ Money Pt. 1

The ebook Diagrams & Dollars has been a top-seller on Amazon (in the category “macroeconomics”) for over a year now. There have been many requests for a paper-back version. In deciding to undertake that mission, I started to expand the original long essay into something that would be more book-like in length—and before I knew it, the effort morphed into something else: a different “frame” for the whole argument. The new “frame” evolved as I was reading Millennial Momentum by Morley Winograd and Michael D. Hais, which views U.S. history from the perspective of a repetitive cycle of four archetypal generations. Every eighty years or so, this cycle repeats, beginning with a “civic” generation—and each of these “fourth turnings” (as they are referred to in the book) is accompanied by dramatic, traumatic, social upheaval. When the upheaval is finally resolved, the “civic” generation is firmly in control, and things settle down, but with a dramatically changed social structure. The “civic” generation that is now leading us into the next “fourth turning” are the Millennials—the children of the baby-boomers—and they now, specifically, are the target audience for the book. 

Before I complete—or even decide to publish—the book, I’d be grateful for feedback and responses to some key sections of it. With that in mind, this is the first of several posts presenting these key sections for comment by the NEP readers.

Please comment as NEP as J. D. requests so he can use the feedback.

New Economic Perspectives 

The Millennials’ Money Pt. 1
J.D. Alt

Matias Vernengo — The Economist is concerned with debt-deflation

TPTB becoming concerned enough to think about taking their blinders off?

Naked Keynesianism
The Economist is concerned with debt-deflation
Matias Vernengo | Associate Professor of Economics, Bucknell University

Max Sawicky — Noah and Nick, Too

Follow up from Max Sawicky that makes some further good points what labor should be treated as labor and not capital.

It's a category mistake aka category error, and it's a logical fallacy.

A category mistake, or category error, is a semantic or ontological error in which things belonging to a particular category are presented as if they belong to a different category,[1] or, alternatively, a property is ascribed to a thing that could not possibly have that property. An example is the metaphor "time crawled", which if taken literally is not just false but a category mistake. To show that a category mistake has been committed one must typically show that once the phenomenon in question is properly understood, it becomes clear that the claim being made about it could not possibly be true. — Wikipedia 

Not only is "human capital" a category error, so is the economic view it is based on. And this is the fundamental problem with conventional economics. There is no problem in choosing any modeling method as along as it contributes to the task one is undertaking, to think about some issue heuristically but precisely, or even just for fun. But that is not the use to which conventional economic models are put. They are used for policy formulation, or at least recommend for such use. Moreover, they are based on a world view that their advocates advance. The model is taken to be not only a simplified model of economics relationship but also a key piece in an ideology that expresses as world view. 

This is a jump from economic modeling to philosophy that is based on huge unacknowledged assumptions about ontology, epistemology, ethics, and social and political philosophy, as well as ignoring in put from relevant disciplines such as psychology and cognitive science, anthropology, sociology and history, all of which deal more critically with what economists tend to assume uncritically. Worse, The economic approach is used to plead for a point of view being representative of reality that favors the interests of a privileged social, political and economic class.

MaxSpeak
Noah and Nick, Too

Max Sawicky

Lars P. Syll — ‘How I became a Keynesian’ (Richard Posner)

Comparable to Nixon's "We are all Keynesians now," Richard Posner embraces Keynes and throws Mankiw under the bus. This is a quote you will want to keep and cherish.

Lars P. Syll’s Blog
‘How I became a Keynesian’Lars P. Syll | Professor, Malmo University

Bill Mitchell — Don’t mention the war! er the Troika …

“Don’t mention the war”! was a classic line from the episode – The Germans – in the comedy Fawlty Towers. Basil Fawlty implored his meagre staff to stay silent in case they offended some German tourists staying at his hotel. His attempt at self-censorship failed and led to hilarious consequences. I was reminded of the sketch (see it below) when I was reading the – Greek finance minister’s letter to the Eurogroup (February 24, 2015). Apparently, it is now a case of ‘Don’t mention the Troika’, ‘Don’t mention the Memorandum’ and never ever talk about the ‘Lenders’. The bullying threesome (European Commission, ECB and the IMF) are now known as “the institutions” and the “Memorandum” (the bailout package) is now to be called “The Agreement” and the “Lenders” have been recast as the “Partners”. Okay, and that is progress. The Reform package surely lets the Greeks choose which nasty policy they will implement but it is still nasty. Yes, it “buys them time”. The damage from massive unemployment and poverty eats into people every day. 4 months is a long time when you are on the street starving. …

Bill Mitchell – billy blog
Don’t mention the war! er the Troika …
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at the Charles Darwin University, Northern Territory, Australia

Tissue Paper-for-Venezuelan Oil Swap Offered by Trinidad

Don't worry Venezuela help is on the way!  Little nation of Trinidad finally offers some toilet paper for oil.

Oil-price crash metaphor alert! Venezuela may start exchanging its crude for toilet paper. http://t.co/R05o03Iovx
— James Herron (@ja_herron) February 26, 2015

Soon no more using tree leaves... did the US just miss a huge "psy-ops" opportunity or what.... could have air dropped in pallets of free toilet paper with "Made in the USA" on the pattern... oh well...

European Rate Chart...

If they keep lowering rates and cutting spending soon (to them) the Troika, errrr... I mean, "the Institutions", will be bankrupted:

Awesome chart "@RichardBarley1: RBS credit strategy shows the extent of the negative yield problem: pic.twitter.com/Y0XhwgtNph”
— Jonathan Ferro (@FerroTV) February 26, 2015

GERMAN BUND GAINS PUSH 10-YEAR YIELD TO RECORD-LOW 0.296%
— Jonathan Ferro (@FerroTV) February 26, 2015

Continued EUR bearish.

Alexey Khlebnikov — Russia is now monitoring the world’s mass media for bias

The Russian Institute for Strategic Studies introduced its first-ever World Mass Media Hostility Index, which measures potential anti-Russian bias in the media publications of different countries, and then assigns each country an overall score.

This analytical report is the result of detailed analysis of the media policies of different countries in 2014, when crucial shifts in the rhetoric employed by Western media about Russia occurred. The author of the mass media hostility index is a senior fellow at RISS, Dr. Igor Nikolaichuk. He suggests that, over the course of 2014, Western media started to "spread anti-Russian propaganda more actively than ever," which he calls the beginning of “the global information war” against Russia. 

The RISS positions its index as the first-ever comprehensive analysis of the world’s media content pertaining to Russia. The analysis is based on complex statistical data (provided by Russian news agency Rossiya Segodnya) that is examined via a new applied discipline known as “political mediametrics.” A unit for analysis is a significant media publication that gives a reader certain assessments of Russia or its leadership.

Russia Direct
Russia is now monitoring the world’s mass media for bias
Alexey Khlebnikov

Max Fisher — The real reasons Iran is so committed to its nuclear program

Getting beyond the media hype.

Vox
The real reasons Iran is so committed to its nuclear program
Max Fisher

Latin America update

Telesurtv.Net

Brazil Issues Support to Venezuela 

Don't Try to Destabilize Argentina, UK Academics Warn Media 

Attorney General Says Colombia-NATO Deal 'Unconstitutional' 

Maduro to Release New Evidence of Coup Attempt 

Maduro: Colombian Paramilitaries Infiltrating Venezuela

Sputnik — Iran Sinks USS Nimitz Life-Size Model in Strait of Hormuz Naval Exercise

Sending a message. Iran demonstrates capability to control of the Strait of Hormuz, the sole entrance to the Persian Gulf, through which tankers must pass, regardless of the presence of the US Navy.

Sputnik
Iran Sinks USS Nimitz Life-Size Model in Strait of Hormuz Naval Exercise

Podcast: Understanding the Daily Treasury Statement (info)

Podcast: Some info on my upcoming, "Understanding the Daily Treasury Statement" course.

Ajay Shah — Become a public policy thinker in three easy steps

Step 1: What's the market failure?

When should the State intervene? The technically sound answer is: When you are certain there is a market failure, and when you are confident you know how to setup the correct State capacity for the intervention.

Market failures come in four kinds: 1. Asymmetric information, 2.externalities, 3. market power and 4. public goods. These are technical terms in microeconomics and each needs to be carefully understood.

The first hurdle that must be crossed in policy thinking is: "Is there a market failure?" Every proposal to do something in public policy faces this test.

Step 2: What's the proposed intervention?

Once we agree there is a market failure, we have to figure out what we'd like to do about it. Here, it's important to understand the anatomy of the market failure, and solve it at its root cause.

If there is a causal chain x -> y -> z, and there is a problem with the outcome z, don't use the power of the State to change y or z. Understand the root cause, and solve it there.…

Step 3: The hurdle of public administration

Okay, you are all dressed up and ready to go, with a demonstrated market failure, and a minimal intervention which solves it. Now the question arises: Can you design a feasible solution with real world public administration?

Ajay Shah
Become a public policy thinker in three easy steps

Ajay Shah | Co-Lead of the NIPFP-DEA Research Program, India

Michael Pettis — When do we decide that Europe must restructure much of its debt?

It is hard to watch the Greek drama unfold without a sense of foreboding. If it is possible for the Greek economy partially to revive in spite of its tremendous debt burden, with a lot of hard work and even more good luck we can posit scenarios that don’t involve a painful social and political breakdown, but I am pretty convinced that the Greek balance sheet itself makes growth all but impossible for many more years. 

The history is, to me pretty convincing. Countries with this level of debt and this level of uncertainty associated with the resolution of the debt are never able too grow out of their debt burdens, no matter how determined and how forcefully they implement the “correct” set of orthodox reforms, until the debt is resolved and the costs assigned. Greece and Europe, in other words, have a choice. They can choose to restructure Greek debt explicitly, with substantial real debt forgiveness and with the costs optimally allocated in a way that maximizes value for all stakeholders, or Greece can continue to struggle for many more years as the debt is resolved implicitly, with the costs allocated as the outcome of an uncertain political struggle. 

Until one or the other outcome, the country is not a viable creditor and it will not grow. There is no way to get the numbers to work. If Europe policymakers who oppose a rapid resolution of its debt crisis continue to prove as intransigent over the next few months as they have been in the past week, I suspect that they will only be able to pull off one of their goals, which is to embarrass Syriza and get it thrown out of office. 

But I suspect that many European policymakers incorrectly think Syriza is as radical as it gets, and once Syriza is discredited, almost any alternative leadership would be better. I disagree. If Syriza is discredited, and the Greek economy continues to stagnate as I expect, the alternative could very easily be Golden Dawn or some other group of radical nationalists determined to blame foreigners for their problems, and Germany will have set itself up for much of the blame. It is ironic, because in my opinion Angela Merkel is not and has never been the bully that she is made out to be, and the main reason Germany seems to be running the show is that no one else has ever dared to disagree with her or to take any position of real leadership. For that reason she and Germany are being seen as far worse than they actually are. 

And this is clearly not just about Greece. Everyone understands that Greece has already restructured its debt once before and received partial forgiveness — in fact once coupon reductions are correctly accounted for Greece’s debt ratio is probably much lower than the roughly 180% of GDP the official numbers suggest. Most people also understand that the Greek debate is not just about Greece but also about whether or not several other countries — Spain, Portugal and Italy among them, and perhaps even France — will also have to restructure their debts with partial debt forgiveness.…

What follows is a long and detailed analysis based on balance sheets.

1. Why must Europe restructure much of its debt? The purpose of a debt restructuring is to make all parties better off by increasing the value of the associated instruments and improving future growth prospects for all the relevant stakeholders. Once the existing debt structure adversely affects future growth prospects and reduces the current wealth of the relevant stakeholders, it makes sense to consider ways in which the debt can be restructured so as to improve both current value and future growth prospects.
2. For most economists, debt is the way operations are funded, and the best debt is the cheapest. I am not suggesting that economists are unaware that certain debt structures are riskier than others, but for the most part they ignore the structure of the balance sheet and focus primarily on the way assets are managed. The moment debt levels become high, however, or create institutional distortions, they begin to affect, and usually constrain, value creation. Debt has four very separate and very important functions, and it is important to understand what they are before deciding what an optimal balance sheet looks like.
3. Once we understand the role and impact of the structure of the balance sheets, it becomes possible to describe what an optimal debt restructuring should accomplish.

Debt can be thought of as a moral obligation when a loan is extended from one individual to another, especially if there is no interest on the loan. But loans to businesses or to sovereign entities are business transactions, and they should be managed as such. The only moral obligation in restructuring sovereign debt, it seems to me, is for policymakers to fulfill their political responsibilities to do what is in the best interests of their citizens and to participate in a responsible way in the global community. The debt restructuring process is, in other words, morally neutral.…

"Excessive debt" begets uncertainty, which increases debt. When is debt "excessive"? When it begins to increase uncertainty to the level that the process is affected. Value begins to be lost, growth contracts, and existing debt multiplies.

To summarize:

1. Under “normal” conditions, the obligations associated with debt are explicit and there is very little uncertainty about how the debt will be resolved. The revenues sources needed to service the debt are clearly identified.
2. When debt levels become “excessive”, that is when the existing revenues sources are no longer sufficient easily to service the debt, uncertainty arises about how the debt will be resolved and even about the amount of the debt to be resolved. This is exacerbated by the highly reflexive relationship between rising uncertainty and rising debt, so that rising uncertainty associated with the resolution of the debt forces adverse stakeholder behavior, which causes the uncertainty associated with the resolution of the debt to rise further.
3. How do we know when debt levels have become “excessive”? Debt levels are excessive when the uncertainty associated with the resolution of the debt is high enough to change the behavior of stakeholders. To put it in terms guaranteed to infuriate policymakers, a country has too much debt whenever the market believes it has too much debt. Anyone who does not understand why it is as simple as this does not understand the economic impact of debt.
4. The purpose of a debt restructuring, then, is to reduce or eliminate the uncertainty associated with the resolution of the debt because this uncertainty automatically reduces value and future growth. If done correctly, a debt restructuring increases the wealth of stakeholders and improves future growth prospects.…

China Financial Markets
When do we decide that Europe must restructure much of its debt?
Michael Pettis | Professor of Finance at Peking University’s Guanghua School of Management

JW Mason — "Disgorge the Cash" at the Roosevelt Institute

I have a working paper up at the Roosevelt Institute, as part of their new Financialization Project.

The Slack Wire

"Disgorge the Cash" at the Roosevelt Institute

JW Mason | Assistant Professor of Economics, John Jay College, City University of New York

Mike Sax — Some More Thoughts on Abba Lerner's Functional Finance and Keynes

Does Abba Lerner's functional finance follow logically from Keynes, or is it a policy statement?

Dairy of a Republican Hater

Some More Thoughts on Abba Lerner's Functional Finance and Keynes

Mike (evilsax) Sax

The Retirement DEMAND LEAKAGES Will Continue To Grow, Until Aggregate Demand Picks Up

   (Commentary posted by Roger Erickson)

These people are all missing the point?

Hence,

The retirement Demand Leakages will continue to grow, until Aggregate Demand picks up. ... Doh!

THE problem? (There's only one?)

THE solution? (Really, Tina? There is no alternative?)

Or, is "retirement" a trick question?

Haven't these people ever heard that no plan survives contact with reality, and that the best way to proceed is to Never Tell People HOW to do things? There is never just one way, and the eventual, most adaptive route is always a total surprise.

Otherwise evolution wouldn't have taken this long to occur.

Even chemists eventually learn that it takes oxy + morons to create Luddites capable of really gumming up the works. Natural selection means that at least a few of even highly social rats will eventually abandon a sinking ship, instead of going down en masse.

And here I thought that the successive, asynchronous generations in our social species WERE both a way to optimize our aggregate demand AND save it for prior generations too! Such an ingenious solution available from the start, but maybe we're not smart enough to grasp that yet? We're certainly not scaling up the same principle, from families to our citizenry.

So what, exactly, IS the definition of intelligence, and why isn't it increasing with increasing population size? What good is a growing network if TINA can't connect the newly emerging dots?

Lars P. Syll — Microfoundations – contestable incoherence

Defenders of microfoundations and its rational expectations equipped representative agent’s intertemporal optimization often argue as if sticking with simple representative agent macroeconomic models doesn’t impart a bias to the analysis. I unequivocally reject that unsubstantiated view, and have given the reasons why here.

I think that a big reason for uncritically accepting assumptions like this is that they seem intuitive. It seems obvious that what happens in aggregate is dependent on the individuals that comprise the aggregate. Being rational implies preferring what one wants to what one doesn't want. Granted. But does that imply the homogeneity regarding utility optimization that proponents of rationality suppose?

A foundational issue in scientific inquiry is about testing intuitions by formulating testable hypotheses instead of receiving them passively as self-evident based on something as nebulous as "intuition" or "common sense". 

For example, if rational expectation about intertemporal optimization is representative enough to be generalized, why do so many people in democratic elections vote contrary to their financial and economic interests and those of their families? The representative agent account may be assuming excessive homogeneity to be a sound basis for modeling.

There nothing wrong with "microfoundations" in itself, but that requires that the assumptions be representative of reality. The actual problem is not so much "microfoundations" as what "microfoundations" is taken to be. Methodological individualism as practiced in conventional economic assume homogeneity among humans similar to atoms as elements in physical systems. It that model transferable from the physical sciences to social science? What is the evidence for it, and what is the evidence against it. Is it simply a modeling convenience?

Such questions cannot be raised in conventional economics, which declares that the controversy over methodology is over, and conventional economics has prevailed as orthodox and everything else is heterodox, that is, "heretical" in the orthodox view.

Lars P. Syll’s Blog
Microfoundations — contestable incoherence
Lars P. Syll | Professor, Malmo University

Brian Romanchuk — U.S. Economy: This Was Not Supposed To Happen

Brian covers a lot of ground in this analysis, which includes a journey through the natural rate doctrine and its use by the Fed.

Bond Economics
U.S. Economy: This Was Not Supposed To Happen
Brian Romanchuk

The information you will learn from the Daily Treasury Statement will not only make you a better investor and forecaster, it will probably shock you and maybe even make you angry!

Three more days to register for my Understanding the Daily Treasury Statement course.

Here are a few of the things you wil come to understand:

Did you know that the U.S. government “paid back” $67 TRILLION to investors LAST YEAR? And our leaders are talking about cutting Social Security to seniors because 40 years from now the SS trust fund will supposedly have a shortfall of $4 trillion?

This is in the Daily Treasury Statement. It’s from the Treasury’s own records.

Did you know that leading flows (spending) to the economy have been very strong, yet government spending as reported in the officially released GDP report shows it as being down? 

This is in the Daily Treasury Statement.

Did you know that we spend 50 times more on interest on public debt than on food stamps?

This is in the Daily Treasury Statement.

Did you know that last February, the Federal Gov’t sent out $120 billion in tax refunds? And it will do it again this February. And it happens every year?

You’ll learn this from the Daily Treasury Statement.

Do you know why there is an expression, “Sell in May and walk away?” when it comes to the stock market?

The Daily Treasury Statement will explain this seasonal effect and why it is so predictable. (And by the way, stock market investors and analysts don’t know the real reason why.)

There is so much more.

If you are an investor, trader, economist, student or just someone interested in getting some real knowledge and insight into the massive finances of our Federal Government and how it affects everything from incomes to investment to savings to the economy then this course is for you.

If you want to be able to make better economic forecasts—for your business, for yourself, for your job, for any reason—better than any computer model, PhD economist or Wall Street analyst with just a few minutes of time per day then this course is for you.

If you want to shock and astound your friends and co-workers and turn them on to information that they have never seen or heard before, making you look like someone with a secret connection deep inside the government, then this course is for you.

If you want to see how our politicians and academics and pundits lie to us or, deceive us or, show how little they really know, this course is for you.

This course will open your eyes. It might even make you mad. It surely will make you a better investor or forecaster of the economy.

Bottom line: It’s well worth the $225. Sign up today. It will change the way you see everything. I guarantee it.

-Mike Norman

Swiss now ratcheting it down domestically...

Evidence now coming in of Swiss firms making moves to reduce costs (and hence prices...)

#Swiss Companies Cut Working Hours to Offset Strong #CHF http://t.co/XUQFNZ9gsu via @cbSwiss pic.twitter.com/1hRAi14mRM
— Forward Guidance (@ecoeurope) February 25, 2015

Continued CHF bearish.

Gerald Epstein — Will Quantitative Easing Solve the European Economic Crisis?

More on Greece and Germany than QE.

TripleCrisis
Will Quantitative Easing Solve the European Economic Crisis?
Gerald Epstein | Professor of Economics, University of Massachusetts at 

Amherst and Co-director, Political Economy Research Institute

Chris Dillow — The relative income problem

Twisting fairness.

Stumbling and Mumbling
The relative income problem
Chris Dillow | Investors Chronicle

Don Quijones — Will US-imposed IP Empire in India Put Global Access to Medicines at Risk?

Prof Brook K Baker, Professor of Law at Northeastern University, cautions that the Modi government’s accelerating flirtation with the US and its investors is dangerous to hundreds of millions of people worldwide whose lives depend on Indian generics.

The new maharajas — same as the old maharajas. Rent-seekers to the core who love to live  high off rent extraction love use schemes to create artificial scarcity, because competition.

Raging Bull-shit
Will US-imposed IP Empire in India Put Global Access to Medicines at Risk?
Don Quijones

Randy Wray — The Spanish Launch of Modern Money Theory

Sorry, I’ve been very busy in recent weeks, finishing up a book on Minsky and revising my Modern Money Primer for a second edition (more on both of those projects later).
Meanwhile, Lola Books is gearing up to release the Primer in Spanish next week. I’ll be in Madrid for the launch and for a series of meetings. I’ll give two presentations that are open to the public. Details are below. Hope to see our Spanish friends there!…

The Spanish edition will have much greater reach than Spain since it will undoubtedly be available in Latin America.

Economonitor — Great Leap Forward
The Spanish Launch of Modern Money Theory
L. Randall Wray | Professor of Economics, University of Missouri at Kansas City

Global Steel Price Down 17% YoY, German Employment

MEPS GLOBAL #STEELPRICE DOWN 17.7 PERCENT IN PAST TWELVE MONTHS http://t.co/6r9UhdWZXj
— Meps International (@mepssteelprices) February 25, 2015

Large volumes of imports, together with collapsing oil prices, have led to cuts in domestic steel production in the US. However, these have not been sufficient to stem the continual, month-on-month, decline in flat product transaction values. Buyers are reluctant to make large purchases as figures trend downwards. Moreover, the volumes of unsold foreign material at the docks are climbing. Some of this steel is now priced above current domestic levels as local steelmakers have responded to the import threat.

The exporters are going to have to lower the price in USD of this unsold inventory they have sitting in the U.S. if they want to sell it... continued USD bullish imo.

And it looks like China is ready to do some price cutting and usual product dumping on their exports also, as the global race to the bottom continues in earnest:

Overcapacity problems, dramatically declining iron ore prices and disappointing economic indicators have driven steel selling values to record lows in China. Negative sentiment is growing. Recently, the Central Bank cut the bank reserve ratio in an effort to shore up flagging economic growth. Market players are waiting to see the impact on the steel sector. The Lunar New Year Festival (February 19-24) was later than it has been in the last few years. This led to buyers postponing steel order placement for a longer pre-holiday period than usual. Dealers were under pressure to sell ahead of the vacation. In overseas markets, export volumes reached a new high in January.

Meanwhile, in the EZ fiscal austerity continues to undermine the German domestic economy:

Ifo Employment Barometer: German Firms Recruit Fewer Staff http://t.co/LDhw8DAAie
— CESifoGroup (@CESifoGroup) February 25, 2015

So you have the export nations Germany/Japan vs. China in a competition to see how far each can lower their real terms of trade with the US; while the lackluster US fiscal backdrop is resulting in a tepid US demand environment for the export products in general.

Unless the current lackluster US fiscal policy changes significantly this FY, the current bearish ex/im and "strong USD" environment is going to continue as the foreign exporters cannot gain any pricing power in the US market under the current macro circumstances.

Moon of Alabama— U.S. Pushes For Escalation, Arms Kiev By Laundering Weapons Through Abu Dhabi

The United Arab Emirates is not known as arms producer. But it buys lots of U.S. weapons. It will now forward those to Ukraine while the U.S. will claim that it does not arm Ukraine. Who do they think will believe them?

Moon of Alabama
U.S. Pushes For Escalation, Arms Kiev By Laundering Weapons Through Abu Dhabi

Ukrainian companies signed several contracts worth tens of millions of dollars, funding the acceleration of its military's modernization, Poroshenko later said in a news release.

Defense News
Ukraine Signs Defense Deal With UAE

ht Chuck Spinney at The Blaster

The advisor to the head of the MIA of Ukraine, member of Verkhovnaya Rada Anton Gerashenko wrote about this in his page on Facebook
According to him, the agreements were achieved during the meeting between the Ukrainian leader and the deputy supreme commander of the UAE Armed Forces, the Crown Prince of the Abu Dhabi emirate Mohammed al-Nahayan. The negotiations occurred in the capital of the Arab state, where Poroshenko came to participate in the international weapon show IDEX-2015.
Gerashenko noted, that volumes of the shipments and types of weapons that is planned to be imported are not subject to disclosure.
«Arabs, unlike europeans and americans, are not afraid of Putin's threats of unleashing a third world war in the case of shipping weapons and materiel to Ukraine. Apparently, they have their own issues with Putin due to the decrease of oil prices by almost a factor of two and the worldwide instability, which impedes long-term development of the UAE. So this will be their small revenge», — wrote the advisor to the Minister of Internal Affairs.

Colonel Cassad
Weapon shipments from the UAE to Ukraine

Stathis Kouvelakis — The Alternative in Greece

Analysis and recommendation from the real left.

Rarely has a strategy been confuted so unequivocally and so rapidly. Syriza’s Manolis Glezos was therefore right tospeak of “illusion” and, rising to the occasion, apologize to the people for having contributed to cultivating it. Precisely for the same reason, but conversely, and with the assistance of some of the local media, the government has attempted to represent this devastating outcome as a “negotiating success,” confirming that “Europe is an arena for negotiation,” that it is “leaving behind the Troika and the Memoranda” and other similar assertions. 

Afraid to do what Glezos has dared to do — i.e. acknowledge the failure of its entire strategy — the leadership is attempting a cover-up, “passing off meat as fish,” to cite the popular Greek saying. 

But to present a defeat as a success is perhaps worse than the defeat itself. On the one hand it turns governmental discourse into cant, into a string of clichés and platitudes that is simply summoned up to legitimate any decision retrospectively, turning black into white; and on the other because it prepares the ground, ineluctably, for the next, more definitive, defeats, because it dissolves the criteria by which success can be distinguished from retreat.…

Jacobin Magazine
The Alternative in Greece
Stathis Kouvelakis, Translated by Wayne Hall.

Also

Georgios Papanicolaou & George S. Rigakos, Golden Dawn and the “Dark Forces”

Chris Gilbert — The Coup d’Etat Attempt in Venezuela

If there were not a coup d’etat underway, someone would have to invent one to rally the masses. That may be the case for the Venezuelan government today, which is beset with so many problems, and it is one of the reasons that some people are incredulous about the latest claim of President Nicolás Maduro to be victim of a planned coup attempt. Nevertheless, there was real evidence presented two weeks ago of a conspiracy in the ranks of the Venezuelan Air Force. In fact, there are three important elements: real evidence, real informers and, fortunately, real arrests.…

CounterPunch
The Coup d’Etat Attempt in Venezuela
Chris Gilbert, Caracas, Venezuela

William Blum — The State Department’s ‘Twilight Zone’

Double-speak.

If you know how to contact Ms. Psaki, tell her to have a look at my list of more than 50 governments the United States has attempted to overthrow since the end of the Second World War. None of the attempts were democratic, constitutional, peaceful, or legal; well, a few were non-violent.

Consortium News
The State Department’s ‘Twilight Zone’
William Blum

See also

New Eastern Outlook
Holocaust Revisionism and the Campaign Against Russia

Caleb Maupin

William R. Polk — Ukraine War: A Reverse Cuban Missile Crisis

Guided by an aggressive neocon “regime change” strategy, the United States has stumbled into a potential military confrontation with Russia over Ukraine, a dangerous predicament that could become a Cuban Missile Crisis in reverse, as ex-U.S. diplomat William R. Polk explains.

Not just me getting concerned with the direction this is going.

Consortium News
Ukraine War: A Reverse Cuban Missile Crisis

William R. Polk

William R. Polk is a veteran foreign policy consultant, author and professor who taught Middle Eastern studies at Harvard. President John F. Kennedy appointed Polk to the State Department’s Policy Planning Council where he served during the Cuban Missile Crisis.

Andrea Germanos — Majority of Germans: We Don't Have a Real Democracy

Over 60 percent of Germans said their country did not have a true democracy because business has a bigger say than the electorate, the survey by the Emnid polling institute for the Free University of Berlin found. 

The finding echoes results of a previous study in the U.S. that found a similar percentage opposed the 2010 Citizens United decision that opened the floodgates to unlimited corporate spending on elections, and said that the voices of the electorate were being drowned out by big-moneyed interests. 

Twenty percent of the German respondents also said that improved living conditions will be achieved through revolution, not reforms, and a third of respondents said that capitalism was the root of hunger and poverty.…

The Local reports that the poll shows "a public much further to the left than previously thought."

Common Dreams
Majority of Germans: We Don't Have a Real Democracy
Andrea Germanos, staff writer

Robert Kirchner — Russell Brand’s Revolution

Who would have thunk that the revolution would be spearheaded by Russell Brand. Robert Kirchner looks at Brand and his latest book, Revolution, from the vantage of an anarchist (of the left).

Why should anyone serious care about Russell Brand? Because culture shapes society and its institutions and celebrities and music shape culture, especially the culture emerging with youth.

So here's a celebrity who self-identifies with anarchism in a contemporary environment of high employment where youth sees its future disappearing, class power is coming to the fore, and populism is rising.

Turns out that TPTB are indeed taking note of Brand and not favorably.

Center for a Stateless Society

Russell Brand’s Revolution
Robert Kirchner

Sandwichman — Larry Summers Tells It Like It Is

We can debate whether it's the cause of dependence or whether it is caused by policies that promote dependence. But I think it is very hard to believe that a society in which the fraction of people in -- choose whatever your most prime demographic group is that should be working, whatever that group is, a society in which the fraction of them who are not working is doubling in a generation and seems to be on an upward trend is going to be a society that is going to function well, or at least function well without major social innovations. 

And I would want to leave you with that concern as there whether you think it's due to technology or whether you think it's due to globalization, or whether you think it's due to the maldistribution of political power, something very serious is happening in our society.

Econospeak
Larry Summers Tells It Like It Is
Sandwichman

Interfax-Ukraine — Poroshenko pledges to return Crimea to Ukraine

Putin has pledged the same about Russia. Collision course.

Interfax-Ukraine — Ukraine News Agency
Poroshenko pledges to return Crimea to Ukraine

Max Sawicky — For Noah and Nick

Max Sawicky rejects the need for and appropriateness of "human capital."

The traditional factors have traditionally been decompose as needed into types of capital, and types and uses of land such as agricultural, resource extraction, commercial and residential, as well as types and grades of labor, with the distinction of salaried versus wage, management versus worker, white collar versus blue collar, skilled versus skilled. The supposed need to introduce a new distinction or to fold land into capital are an unnecessary and confusing aggregation that clouds modeling instead of clarifying it.

Do firms use the concept of human capital? For sure. It's a buzz word. Management attempts to produce metrics on the dollar value employees produce over time, which is the ROI with respect to the cost of employing them. But they are still employees even if the firm seeks to capitalize them for management purposes, e.g., retention and promotion and compensation. They are still part of labor and not capital goods. Labor is not fixed investment and it is not depreciated. In fact, unlike capital, labor tends to appreciate over time rather than depreciate, especially in modern environments that don't wear down workers, although some business models are still based on this, especially for foreign labor in developing countries where protections are slight to non-existent.

MaxSpeak
For Noah and Nick

Max Sawicky

Juan Thompson — Report: Rahm Emanuel’s Chicago Police Operating Domestic Black Site

Chicago will be Chicago. Al Capone is looking like one of the good guys. Add Rahm's name to the list that should be in a dock at The Hague along with George W. Bush, Dick Cheney, and Barack Obama. So far, Joe Biden seems to be just a war-profiteer.

Mayor Rahm Emanuel’s Chicago Police Department is operating a CIA-style black site on the city’s West Side, according to an explosive new report fromThe Guardian’s Spencer Ackerman. The facility, an otherwise plain warehouse known as Homan Square, also houses military-style vehicles, according to Ackerman. 

The Guardian reports that the CPD detains mostly poor, black and brown people at Homan. Once at the site, detainees are allegedly beaten by police, shackled for hours and denied access to counsel. There is no booking at Homan Square, so details about who has been detained at the facility are scarce. “Witnesses, suspects or other Chicagoans who end up inside do not appear to have a public, searchable record entered into a database indicating where they are,” Ackerman wrote. “Lawyers and relatives insist there is no way of finding their whereabouts.”

The Intercept
Report: Rahm Emanuel’s Chicago Police Operating Domestic Black Site

Juan Thompson

Philip Ewing — Ash Carter warns Russia on nukes

Ratcheting up toward nuclear war. For the first time in a long time, I find it plausible that there will be a nuclear war within a year. I would not yet call it likely, but that's ruling out unforeseen occurrences. While neither the US nor Russia wants wider war, once a war is going on, militaries begin to ramp up, and leaders get nervous trigger fingers, all it takes is a spark to light the fire. If I were in Europe, I would be especially concerned because Europe is the pawn in this game.

Politico
Ash Carter warns Russia on nukes

Philip Ewing

Greece: Austerity for the Bankers — Sharmini Peries interviews Michael Hudson

Michael Hudson says Greece’s Finance Minister Varoufakis is proposing austerity on the banking class rather than on the working class to balance the budget.

Video and transcript.

MH: …what’s at issue really is a class war. It’s not so much Germany versus Greece, as the papers say. It’s really the war of the banks against labor. And it’s a continuation of Thatcherism and neoliberalism.…

Originally, Varoufakis thought he was negotiating with the troika, that is, with the IMF, the European Central Bank and the Euro Council. But instead they said, no, no, you’re negotiating with the finance ministers. And the finance ministers in Europe are very much like Tim Geithner in the United States. They’re lobbyists for the big banks. And the finance ministers said, how can we screw this up and make sure that we treat Greece as an object lesson, pretty much like America treated Cuba in 1960?…

This is a good one.

Michael Hudson
Greece: Austerity for the Bankers

Sharmini Peries interviews Michael Hudson