November 2017 ~ Mike Norman Economics

Thursday, November 30, 2017

Paul Craig Roberts — Can’t You See War On The Horizon?

PCR switches from his usual outrage to concern over monumental US hubris. Begging for nemesis?

Paul Craig Roberts
Can’t You See War On The Horizon?

Neema Singh Guliani — New Surveillance Bill Would Dramatically Expand NSA Powers

The USA Patriot Act, passed hurriedly after 9/11, taught us that rushing a surveillance bill through Congress is a bad idea, producing complicated statutes ripe for abuse. Yet the leadership of the House Intelligence Committee is taking a page out of President George W. Bush’s playbook and trying to do just that.

Tomorrow, the committee will debate a bill that dramatically expands NSA surveillance authorities, including one that is scheduled to expire at the end of the year. The bill was publicly released just last night, giving members of the committee and other legislators less than 48 hours to try to understand the complex proposal.

Perhaps hoping no one has time to closely read the “FISA Amendments Reauthorization Act of 2017,” sponsors have pitched the measure as one that makes key changes to intelligence authorities to “protect Americans’ privacy rights.” The truth, however, is that it does the exact opposite.

This is why the ACLU, joined by over 30 organizations from across the political spectrum, is urging members of Congress to oppose the bill. Here are some of the reasons we’re fighting this legislation....

Blog of Rights: Official Blog of the American Civil Liberties Union
New Surveillance Bill Would Dramatically Expand NSA Powers
Neema Singh Guliani, ACLU Legislative Counsel

Reuters — Deficit worries roil Senate debate on tax bill, leaders scramble for votes

Deficit hysteria rises just prior to the hitting of the debt ceiling due on Dec. 8th, which will ratchet up debt phobia, too. What else is new in Moronville?

Behind closed doors on Capitol Hill, concerns were mounting, however, about Republican Senator Bob Corker’s push for a snap-back “trigger” amendment to the bill that would raise taxes automatically, possibly on corporations, if economic growth targets are not hit in the future, to offset a higher deficit.

Conservative Republican Senator Ted Cruz said at mid-afternoon that there were problems with the ”trigger“ proposal, and ”a significant number of members would have a serious problem“ if it only triggered tax hikes and not spending cuts.”...

Reuters

Deficit worries roil Senate debate on tax bill, leaders scramble for votes
Susan Cornwell and Amanda Becker

See also

Sausage-making.

Zero Hedge
Senate Bill Nearly Killed By Deficit Hawks: Will Include $350 Billion In New Tax Hikes
Tyler Durden

Christelle Néant — Atlantic Council wants war against Russia over a Ukrainian fish story

Some fact-checking about the newly contracted Kerch Bridge over the Kerch Strait of the Sea of Azov that connects the Crimean peninsula to the Russian mainland.

Fort Russ

Atlantic Council wants war against Russia over a Ukrainian fish story

Christelle Néant in Agoravox.fr, translated by Tom Winter

RT — US sanctions aimed at turning business elite against Putin before election – Kremlin

The Russian government is convinced that US sanctions are aimed at regime change in Russia.

RT
US sanctions aimed at turning business elite against Putin before election – Kremlin

See also

RT's Capitol press credentials cancelled.

Sputnik International
Russia Hysteria: US Congress Revokes RT’s Capitol Hill Press Credentials

Global Research - The Hidden Truth About Ukraine, Kiev Euromaidan Snipers Kill Demonstrators. Italian Documentary Bombshell Evidence

People in the alternative media are often said to be spreading fake news, especially when it comes to false flags, but this Italian documentary seems to indicate that there was indeed a false flag at Maiden Square in the Ukraine. Global Research also has the full Italian documentary.

Global Research - The Hidden Truth About Ukraine

Excerpt -

The interviews with three snipers of Georgian nationality, conducted by the Italian journalist Gian Micalessin and aired as a breathtaking documentary on Milan-based Canale 5 (Matrix program) last week, still have not paved its way to the international mainstream media. That is hardly surprising taking into account the bombshell evidence against the real perpetrators and organizers of the 2014 coup d’etat in Kiev, generally known as the “revolution of dignity“.

Jimmy Dore - Russia Hacks Wisconsin Teachers Union & Cuts Pay $10k!

It looks like the US is on its way out. All empires end when they get too big and then get overblown with a big military while its core crumbles with its civilians become poorer. Pure capitalism can't ever work as it will always leave too much power in the hands of just a few people who will still want more and more until the system collapses. The six ancient Chinese civilizations all ended the same way and the Chinese never learnt their lesson. A greedy few would always in the end hollow out a great civilization until it imploded. These 'free market' economists don't know what they are talking about and the libertarians live in a fantasy world.

Here Jimmy Dore says how the bankers bankrupted the country but the teachers were told that their unions had helped bring the country down. So the bankers got richer on taxpayers money and teachers became poorer, but isn't investing in children's education a way to help a country become prosperous?

In this video Jimmy Dore says how when RT got forced to register as a foreign agent that this was just the start and now the Chinese news agency, Zinhua, has been forced to do the same. Is Al Jazeera and TeleSUR next? The US has long lost its democracy as the corporate media allows no true debate.

Military Capability and Aircraft Carrier Vulnerability

The bottom line on aircraft carrier survivability is that only a handful of countries can credibly pose a threat to America's most valuable warships, and short of using nuclear weapons none of those is likely to sink one....

The National Interest
Are U.S. Aircraft Carriers Nearly Unsinkable?

Loren B. Thompson | Chief Operating Officer of the non-profit Lexington Institute and Chief Executive Officer of Source Associates, a for-profit consultancy. Prior to holding his present positions, he was Deputy Director of the Security Studies Program at Georgetown University and taught graduate-level courses in strategy, technology and media affairs at Georgetown. He has also taught at Harvard University’s Kennedy School of Government.

Kyle Mizokami, cofounder of the defense and security blog Japan Security Watch. is a defense and national-security writer has appeared in the Diplomat, Foreign Policy, War is Boring and the Daily Beast.

On the other hand,

Those who continue to defend the aircraft carrier have an obvious solution: missile defenses can stop any incoming attacks and keep the carrier relevant for decades. That seems like a reasonable argument, except for one very basic problem: first-grade math tells us it’s flat-out wrong. As I have said on several occasions, U.S. naval planners in the future will face large missile forces aimed at their ships that could very well overwhelm their missile defense platforms....

Taking the above example to its logical extreme, could China, Russia, Iran, or even one day North Korea simply build enough missiles on the cheap and launch them close enough to exhaust the defenses of a U.S. aircraft carrier strike group? Considering that we are currently unable to reload such defenses with ease at sea, our forces would face an unpleasant choice if their missile interceptors were exhausted: withdraw or face down enemy missiles with no defenses….

The American Conservative
Face It, The Mighty U.S. Aircraft Carrier is Finished

Harry J. Kazianis, director of defense studies at the Center for the National Interest and executive editor of its publishing arm, The National Interest. Previously, he served as editor of The Diplomat, a fellow at CSIS, and on the 2016 Ted Cruz foreign policy team.

See also

A new generation of Russian and Chinese-built long-range air-to-air missiles could threaten the critical nodes that enable U.S. air operations. Those nodes include the AWACS, various intelligence, surveillance and reconnaissance (ISR) assets, aerial refueling tankers and electronic attack aircraft.

While often overlooked in favor of advanced anti-ship and surface-to-air missile systems when examining Russian and Chinese anti-access/area denial (A2/AD) capabilities, such long-range air intercept weapons—coupled with the right fighter—could cut the sinews that allow the United States to conduct sustained air operations in both the Asia-Pacific and the European theatres. Essentially, Russians and/or Chinese forces could pair long-range air-to-air missiles with aircraft like the Mikoyan MiG-31 Foxhound, Sukhoi T-50 PAK-FA and the Chengdu J-20 to attack American AWACS, JTARS and aerial refueling tankers like the Boeing KC-135 or forthcoming KC-46 Pegasus. Especially over the vast reaches of the Pacific where airfields are few and far between, lumbering aerial refueling tankers could be an Achilles’ Heel that Beijing could chose to exploit....

The National Interest

The Real Story of How Russia or China Could Defeat America in an Air War
Dave Majumdar, defense editor for the National Interest

See also

The United States has poured ten of billions of dollars into developing fifth-generation stealth fighters such as the Lockheed Martin F-22 Raptor and F-35 Joint Strike Fighter. However, relatively simple signal processing enhancements, combined with a missile with a large warhead and its own terminal guidance system, could potentially allow low-frequency radars and such weapons systems to target and fire on the latest generation U.S. aircraft....

It is a well-known fact within Pentagon and industry circles that low-frequency radars operating in the VHF and UHF bands can detect and track low-observable aircraft. It has generally been held that such radars can’t guide a missile onto a target—i.e. generate a “weapons quality” track. But that is not exactly correct—there are ways to get around the problem according to some experts....

The National Interest
The Shocking Way Russia or China Could Kill an F-22 or F-35

Dave Majumdar, the defense editor for the National Interest

also

For example, this Chinese article argues that JH-7ss using a combination of YJ-91 anti-radar missiles and electronic warfare would pose a “nightmare” for Aegis-equipped ships. Of course, using radar jamming alone is not an automatic “win button” against air defenses. However, jamming does degrade their effective radar detection and targeting ranges, making a swarm of attacking missiles or aircraft more likely to overwhelm the defenses.

The National Interest
China's New J-16D Aircraft Might Have a Terrifying New Military Capability

Sébastien Roblin

Also of interest

It’s important to note early that the EMP threat has become an unlikely live wire. Its most extreme proponents genuinely fear near-total annihilation; its vocal detractors dismiss the threat as science fiction.

In between, though, lie some important subtleties. Crucially, you won’t find much disagreement on the very basic science.

Shouldn't the precautionary principle apply?

Wired
North Korea's Plenty Scary Without An Overhyped EMP Threat

Joaquin Flores — China to fight ISIS in Syria? No, and here's why FRN didn't run that story

Fort Russ News has no problem printing a retraction, but we'd rather avoid that when we know beforehand that we'd later have to. There's a cynical saying inside the news world, that news only has to be true for a day. We aren't interested in that. Maintaining readership and building trust as a credible paper, emerging as a paper of record, is a long-term and principle-based project, and this means not covering a sensational story that gives a short term boost to ratings.

Fort Russ
China to fight ISIS in Syria? No, and here's why FRN didn't run that story

Joaquin Flores | Editor-in-Chief of Fort Russ News, as well as the Director of the Belgrade based think-tank, the Center for Syncretic Studies. Educated at California State University, Los Angeles, in the field of International Relations. he previously served as Chief Negotiator and Internal Organizer in several jurisdictions for the SEIU labor union in California.

David P. Goldman — Still no Phillpsy-Curve

New data shows continued weak inflation in US, Europe

Asia Times
Still no Phillpsy-Curve

David P. Goldman

US tax bill gets huge boost as McCain says yes

Pepe Escobar — From the Caucasus to the Balkans, China’s Silk Roads are rising

With its focus on Central Asia and Eastern Europe, the Belt and Road Initiative can be seen as fulfilling a strategy of challenging the West that can be traced back to Mao….

In the midst of this frenzy of connectivity, it’s easy to overlook a significant historical point: that it was all anticipated by Mao Zedong.

Scholar Chen Gang has stressed how most BRI-participating nations are not as developed, economically, as China. And they are “not just limited to the Eurasian continent, but will eventually cover all the ‘middle zone’ and ‘third world’ put forward by Mao in his ‘Three Worlds Theory.’”

Flashback to 1974. That’s when Mao described the world as being divided between superpowers (the US and USSR); intermediate powers (Japan, Europe, Canada); and exploited nations in Africa, Latin America and Asia, which Mao praised as constituting the forces against First World hegemony. Mao placed China in the third world – as Deng Xiaoping told the UN.

What’s fascinating is how Chen Gang interprets BRI not only as a sequel to China’s historical ties with the Third World, but also as opening a “new era of China’s Third World strategy.” He correctly states that US and EU elites worry that BRI will bring about “the erosion of their global influence and overseas interests.”

Chen Gang’s analysis touches on what, by now, is obvious: “The international game around BRI has just begun.” And it goes almost without saying that Beijing’s BRI-driven foreign policy strategy, by turbo-charging China’s cooperation with the ‘Global South,’ is leaving the US, at best, marginalized.

Of course, the Atlanticists are not going to just sit by and watch this happen to them.

It's game on.

Asia Times
From the Caucasus to the Balkans, China’s Silk Roads are rising
Pepe Escobar

SJWs

100% correct observation here but what is the solution?

I can tell you it is NOT to just try to force these Arts degree people into material systems jobs that they are not qualified to do... that is what we have been doing and here we are stuck in this moron-fest... we have to figure out how to get them robustly provisioned without trying to force them to be something they are not.

Social Justice Warriors are not working class heroes. They are bourgeois arts graduates with no aptitude for science or business, who feel bitter at the large disparity between their high self-evaluation and their low prospects.
— Alice Smith (@TheAliceSmith) November 25, 2017

US Forces Afghanistan Strategy

US forces trying to cut these USD zombies off from their source.

I've never seen zombies defeated this way, normally it takes a direct head shot and eventual development of a vaccine.

We'll have to see how this new strategy does...

Afghan and U.S. operations against Taliban sources of revenue have set the Taliban back approximately $11 million since Nov. 19. “In the face of this pressure, the Taliban cannot win,” Gen. Nicholson said. #AFGStrong #ForAFG https://t.co/raEVDH4Ngu pic.twitter.com/xHoN962m76
— USForces Afghanistan (@USFOR_A) November 30, 2017

Wednesday, November 29, 2017

Peter Diamandis — China Is an Entrepreneurial Hotbed That Cannot Be Ignored

During dinner, Kai-Fu lamented that 10 years ago, it would be fair to call Chinese companies copycats of American companies. Five years ago, the claim would be controversial. Today, however, Kai-Fu is clear that claim is entirely false....

SingularityHub
China Is an Entrepreneurial Hotbed That Cannot Be Ignored

Peter Diamandis | Chairman and CEO of the X PRIZE Foundation

Zero Hedge — China To Deploy Elite Troops To Syria To Fight Alongside Assad's Army

Update: This news seems to have been incorrect. The Syrian government has denied it.
Joaquin Flores explains here, China to fight ISIS in Syria? No, and here's why FRN didn't run that story

According to multiple reports in Middle East regional sources, China plans to send elite military units to Syria to advise and assist the Syrian Army in an attempt to root out the country's terrorist insurgency, especially Chinese Islamist foreign fighters who have shown up in increasing numbers in Syria's north since the start of the conflict.

If confirmed this won't be the first time China - one of the five veto-wielding powers of the UN Security Council - has sent assistance to the Assad government: according to previous reporting by Middle East Eye, China began quietly sending soldiers in an advisory capacity into Syria earlier this year to assist government forces in weapons systems, intelligence collection, logistics, and medicine. But this certainly marks a dramatic and more public escalation in terms of Chinese operations in the region as Beijing will reportedly send special forces to work closely with government troops, and likely in coordination with the Russians as well....

Zero Hedge
China To Deploy Elite Troops To Syria To Fight Alongside Assad's Army

Tyler Durden

See also

In the Middle East and beyond, we are witnessing a series of high-level political meetings between dozens of nations involved directly or indirectly in the Syrian situation. It is crucial to understand all this in order to understand the direction in which the region is going and what the new regional order is.

The Strategic Culture Foundation
The End of the Syrian War Is the Beginning of a New Middle Eastern Order
Federico Pieraccini

Michael Hudson — Monetary Imperialism

This article is adapted from the German edition of Super-Imperialism (2017).…

It's a fairly long article. Here are some highlights in summary.

The U.S. response has been to extend the new Cold War into the financial sector, rewriting the rules of international finance to benefit the United States and its satellites – and to deter countries from seeking to break free from America’s financial free ride.

Aiming to isolate Russia and China, the Obama Administration’s confrontational diplomacy has drawn the Bretton Woods institutions more tightly under US/NATO control. In so doing, it is disrupting the linkages put in place after World War II.
The U.S. plan was to hurt Russia’s economy so much that it would be ripe for regime change (“color revolution”). But the effect was to drive it eastward, away from Western Europe to consolidate its long-term relations with China and Central Asia.…

To U.S. strategists, what made changing IMF rules urgent was Ukraine’s $3 billion debt falling due to Russia’s National Wealth Fund in December 2015. The IMF had long withheld credit to countries refusing to pay other governments. This policy aimed primarily at protecting the financial claims of the U.S. Government, which usually played a lead role in consortia with other governments and U.S. banks. But under American pressure the IMF changed its rules in January 2015. Henceforth, it announced, it would indeed be willing to provide credit to countries in arrears other governments – implicitly headed by China (which U.S. geostrategists consider to be their main long-term adversary), Russia and others that U.S. financial warriors might want to isolate in order to force neoliberal privatization policies.…

Since World War II the United States has used the Dollar Standard and its dominant role in the IMF and World Bank to steer trade and investment along lines benefiting its own economy. But now that the growth of China’s mixed economy has outstripped all others while Russia finally is beginning to recover, countries have the option of borrowing from the Asian Infrastructure Investment Bank (AIIB) and other non-U.S. consortia.

At stake is much more than just which nations will get the contracting and banking business. At issue is whether the philosophy of development will follow the classical path based on public infrastructure investment, or whether public sectors will be privatized and planning turned over to rent-seeking corporations.…

American strategists evidently hoped that the threat of isolating Russia, China and other countries would bring them to heel if they tried to denominate trade and investment in their own national currencies. Their choice would be either to suffer sanctions like those imposed on Cuba and Iran, or to avoid exclusion by acquiescing in the dollarized financial and trade system and its drives to financialize their economies under U.S. control.

The problem with surrendering is that this Washington Consensus is extractive and lives in the short run, laying the seeds of financial dependency, debt-leveraged bubbles and subsequent debt deflation and austerity. The financial business plan is to carve out opportunities for price gouging and corporate profits.…

This policy threat is splitting the world into pro-U.S. satellites and economies maintaining public infrastructure investment and what used to be viewed as progressive capitalism. U.S.-sponsored neoliberalism supporting its own financial and corporate interests has driven Russia, China and other members of the Shanghai Cooperation Organization into an alliance to protect their economic self-sufficiency rather than becoming dependent on dollarized credit enmeshing them in foreign-currency debt.

At the center of today’s global split are the last few centuries of Western social and democratic reform. Seeking to follow the classical Western development path by retaining a mixed public/private economy, China, Russia and other nations find it easier to create new institutions such as the AIIB than to reform the dollar standard IMF and World Bank. Their choice is between short-term gains by dependency leading to austerity, or long-term development with independence and ultimate prosperity.

This policy threat is splitting the world into pro-U.S. satellites and economies maintaining public infrastructure investment and what used to be viewed as progressive capitalism. U.S.-sponsored neoliberalism supporting its own financial and corporate interests has driven Russia, China and other members of the Shanghai Cooperation Organization into an alliance to protect their economic self-sufficiency rather than becoming dependent on dollarized credit enmeshing them in foreign-currency debt.

At the center of today’s global split are the last few centuries of Western social and democratic reform. Seeking to follow the classical Western development path by retaining a mixed public/private economy, China, Russia and other nations find it easier to create new institutions such as the AIIB than to reform the dollar standard IMF and World Bank. Their choice is between short-term gains by dependency leading to austerity, or long-term development with independence and ultimate prosperity.

The price of resistance involves risking military or covert overthrow. …

This is not how the Enlightenment was supposed to evolve. The industrial takeoff of Germany and other European nations involved a long fight to free markets from the land rents and financial charges siphoned off by their landed aristocracies and bankers. That was the essence of classical 19th-century political economy and 20th-century social democracy. Most economists a century ago expected industrial capitalism to produce an economy of abundance, and democratic reforms to endorse public infrastructure investment and regulation to hold down the cost of living and doing business. But U.S. economic diplomacy now threatens to radically reverse this economic ideology by aiming to dismantle public regulatory power and impose a radical privatization agenda….

Counterpunch
Monetary Imperialism
Michael Hudson | President of The Institute for the Study of Long-Term Economic Trends (ISLET), a Wall Street Financial Analyst, Distinguished Research Professor of Economics at the University of Missouri, Kansas City, and Guest Professor at Peking University

See also

The Obama administration sparked controversy in Congress and the national security world when it announced in late 2016 that it would spend more than $8 million dollars to purchase Iranian heavy water, a nuclear byproduct, in a bid to keep the Islamic Republic in line with restrictions on these materials imposed under the nuclear agreement....

After leaving the door open to additional purchases, senior Trump administration officials confirmed to the Free Beacon on Wednesday that the U.S. government would no longer engage in these nuclear transactions with Iran, a major policy shift that sources say is part of an effort to crackdown on Iran's access to U.S. funds.

Lawmakers and other insiders had viewed the $8.6 million payment to Iran as a scheme to give Iran access to U.S. currency as part of an incentive package aimed at keeping it in compliance with the nuclear deal....

Trump administration officials told the Free Beacon they have informed Iran that it is now solely responsible for maintaining compliance with the nuclear deal.

"No, the United States is not planning to purchase any Iranian heavy water," a White House National Security Council spokesperson told the Free Beacon. "We have made it clear to Iran that it is their responsibility to remain under their heavy water limit in the JCPOA," or Joint Comprehensive Plan of Action, the official title of the nuclear agreement....

So, in addition to continuing economic warfare against Iran, the Trump administration is making it harder for Iran to conform to the nuclear deal.

Washington Free Beacon

Trump Admin Halts Taxpayer-Funded Purchases of Iranian Nuclear Materials

Adam Kredo

See also

RT reports that Siluanov warned if the west include the seizure of Russia's foreign exchange reserves, it would be regarded as a "declaration of a financial war."
The budget "has a margin of safety in case of restrictions and sanctions." It also includes losses incurred by a probable ban on investment in Russian government bonds for foreign funds. The US Treasury is currently considering such penalties.

"If we did not have a margin of safety, then it would be easy to weaken us. And then, our so-called friends would say – if you want to get help from the International Monetary Fund, you must do this and that," said Siluanov.

If sanctions include the freezing of foreign accounts of the central bank, it would be equal to declaring financial war on Russia, Siluanov said.

Zero Hedge

Russia Warns Washington: Confiscating Gold Reserves Would Be "Declaration Of Financial War"

Tyler Durden

Robin Andersen — Backlash Against Russian ‘Fake News’ Is Shutting Down Debate for Real

Three important takeaways here.

1. There is no evidence that RT or Sputnik pushed fake news. They featured accurate news reports that the US establishment didn't like and hosts and guests that contested the US establishment message.

2. The US tech industry and Google in particular have enormous control over the US information system and they use it the interest of the US establishment.

3. The US intelligence apparatus revealed its high degree of politicization and involvement in domestic propaganda.

The real concern should be the close integration of the private and public sectors in advancing the interest of the US establishment rather than Russian influence in US domestic affairs.

FAIR
Backlash Against Russian ‘Fake News’ Is Shutting Down Debate for Real
Robin Andersen

Dan Goodin — Websites use your CPU to mine cryptocurrency even when you close your browser

A new wrinkle in free riding.

Ars Technica
Websites use your CPU to mine cryptocurrency even when you close your browser
Dan Goodin | Security Editor

Bill McBride — Policy Mistakes

Add the Trump tax cuts to the list of policy mistakes if it becomes law.

Calculated Risk
Policy Mistakes
Bill McBride

Brad DeLong — Should-Read: Alan Simpson and Erskine Bowles: Unfortunately, the tax plan currently

The deficit hawks and debt phobes are back at it again. At least they are consistent across administrations and parties.

WCEG — The Equitablog
Should-Read: Alan Simpson and Erskine Bowles: Unfortunately, the tax plan currently
Brad DeLong

On Contact: The Birth of American Empire with Stephen Kinzer

Chris Hedgers talks to Stephen Kinzer about the American Empire. The US ruling elite always had debates about whether to expand the US beyond its borders or invest in building up their country at home instead, but by a few narrow votes they always voted to expand.

Stephen Kinzer says how after WW2 the US had a surplus of products coming out its factories and the farmers were producing a surplus too and so big business pushed Congress to expand the country's borders to find new markets. The first thing they did was to take the Philippines from Spain thinking it would be a gateway to Chinese markets where American farmers hoped to get the Chinese liking their beef. The ruling class thought they would be able to get raw materials cheap from other countries and then sell finished goods back to them at a substantial mark up. I thought this was a very interesting interview.

Edward Harrison — We are in the most dangerous period in the business cycle

The big picture then is this: a global economy into its ninth year of the business cycle that is starting to gain momentum with the US flirting with 3% growth and 4% unemployment with richly priced asset markets but a flattening yield curve.

We’ve seen this picture before.…

In retrospect, one could argue that the Fed’s late interest rate hike campaign was a policy error – that the Fed should have seen the flattening yield curve as a canary in the coal mine and resisted raising its policy rates despite any concern about elevated asset prices.

I think this is the Fed’s real conundrum this late in a business cycle. If the economy is running solidly and leading economic indicators are bullish, the Fed is hard-pressed to not raise rates in an environment in which headline unemployment is low and falling, asset prices are rich, and lending standards have loosened — even if the yield curve is flattening. Aren’t they supposed to take the punch bowl away?

I don’t have the answer to that question. Time and again, late in the cycle, the Fed has indeed taken the punch bowl away. And the result was recession and financial crisis.

That’s exactly why this is the most dangerous period in the business cycle.

Credit Writedowns
We are in the most dangerous period in the business cycle
Edward Harrison

Pam Martens and Russ Martens — Trump Now Says Wall Street Is the Victim, Not the Villain

“Populist” candidate for President, Donald Trump, railed against the “political establishment” and Wall Street elites who were “getting away with murder.” On October 26, 2016, just days before the Presidential election, Trump spoke at a rally in Charlotte, North Carolina and promised to uphold the plank in the Republican Party platform to break up the big banks by restoring the Glass-Steagall Act.…

Now, as the sitting President, the former populist candidate has become the embodiment of the political establishment he railed against. He has stacked his administration with former bankers from Goldman Sachs; he has placed deeply conflicted Wall Street cronies in key regulatory posts; and he is promising to roll back critical financial reforms. His Treasury Secretary, Steve Mnuchin, has disavowed any intention to reinstate the Glass-Steagall Act.

To the careful observer, it would appear that the American people have, once again, been played for fools by billionaires who no longer need to hide behind a dark political curtain but have simply seized the reins of power for themselves in broad daylight.…

Remind you of Lucy snatching the football away from Charlie Brown yet again?

Wall Street On Parade
Trump Now Says Wall Street Is the Victim, Not the Villain
Pam Martens and Russ Martens

More bad news...

This really is terrible:

Cyber Monday becomes largest online shopping day in US history, ringing up $6.59 billion in sales https://t.co/ihLA1upXag pic.twitter.com/cxoAivamt8
— Blimling&Associates (@Blimling) November 29, 2017

Oops this is going the wrong way now too:

U.S. third-quarter GDP revised up to 3.3%, a three-year high https://t.co/jwCP8xWstJ pic.twitter.com/hdemaEQadL
— Bloomberg Markets (@markets) November 29, 2017

Spotted in India...

20 Ft. tall Ivanka!

Oh God, Ivanka Trump is being promoted as a role model. 🤦🏻‍♂️

Need a banging head against a brick wall emoji. 🤯 pic.twitter.com/i1eC2UaPEJ
— Ramanan (@Ramanan_V) November 28, 2017

LOL!!!

Fed's Powell on Congress' Role

Lane departure from previous two Fed morons:

Fed chair nominee Jerome Powell tells Congress: Measures to boost U.S. growth 'in your lane, not so much ours' https://t.co/PolpKRR0mQ pic.twitter.com/k9EEP5mGDq
— Real Time Economics (@WSJecon) November 28, 2017

Bill Mitchell — The EMU reform ruse – Part 2

This blog continues the discussion from yesterday’s blog – The EMU reform ruse – Part 1 – where I consider the reform proposals put forward by German academic Fritz Sharpf, which have been held out by Europhile Leftists as the progressive way out of the disaster that the Eurozone has become. Yesterday, I considered his first proposal – to continue with the enforced structural convergence to the Northern model – the current orthodoxy in Brussels. Like Sharpf I agree that the agenda outlined in the 2015 The Five President’s Report: Completing Europe’s Economic and Monetary Union would just continue the disaster and would intensify the political and social instability that will eventually force a breakup of the monetary union. Sharpf’s second proposal is that the EMU dichotomise into a Northern hard currency bloc while the Southern states (and others less inclined to follow the German export-led, domestic-demand suppression growth model) reestablish their own currencies and peg them to the euro with ECB support. While it is an interesting proposal and certainly more adventurous than the plethora of proposals that just tinker at the edges (for example, European unemployment insurance schemes, Blue Bond proposals and the like), it remains deeply flawed. While it is assumed that the Northern bloc would comprise core European nations such as Germany and France, it is not clear that either would prosper under the new arrangement. France and Germany were never been able to maintain stable currencies prior to the EMU. Further, the ‘exit’ proposal ties the poorer nations into a vexed fixed exchange rate arrangement, which would always compromise their domestic policy freedom, just as it did under the earlier versions of the Snake or the European Exchange Rate Mechanism (ERM). Far better to just break the whole show up and let the nations go free with floating exchange rates....

Bill Mitchell – billy blog
The EMU reform ruse – Part 2
Bill Mitchell | Professor in Economics, University of Newcastle, New South Wales, and Director of the Centre of Full Employment and Equity (CofFEE)

Tuesday, November 28, 2017

Frances Langum — The GOP Tax Bill: A Stealth Attack On Medicare And Social Security

Last night Chris Hayes ended "All In" with a discussion of the GOP Tax Plan. Economists David Cay Johnston and Stephanie Kelton agreed that if Republicans get their long-awaited wich and this budget-busting tax plan is enacted, the huge deficits it will create might not lead to the promised "growth" Steve Mnuchin insists will result.

What happens if Steve Mnuchin is wrong? Austerity budgets that cut into the heart of the biggest programs paid for out of the federal budget: Social Security and Medicare....

Stephanie Kelton explains how the GOP has set it up so they win even if they lose. They win if there is a big jump in growth, taxes pile in, and there is no increase of the deficit, hence, the debt (unlikely). They lose is there is a ballooning deficit and debt that voters perceive as a financial threat calling for increased taxes. But they also win since they can argue that taxes don't need to be raised but rather expenses cut, giving them a clear shot at Social Security and Medicare (likely).

Crooks and Liars
The GOP Tax Bill: A Stealth Attack On Medicare And Social Security
Frances Langum

Ed Pilkington - Hookworm, a disease of extreme poverty, is thriving in the US south. Why?

Children playing feet away from open pools of raw sewage; drinking water pumped beside cracked pipes of untreated waste; human faeces flushed back into kitchen sinks and bathtubs whenever the rains come; people testing positive for hookworm, an intestinal parasite that thrives on extreme poverty.

These are the findings of a new study into endemic tropical diseases, not in places usually associated with them in the developing world of sub-Saharan Africa and Asia, but in a corner of the richest nation on earth: Alabama.

An eight-year-old child was sitting on the stoop of one of the trailers. Below him a white pipe ran from his house, across the yard just a few feet away from a basketball hoop, and into a copse of pine and sweet gum trees.

The pipe was cracked in several places and stopped just inside the copse, barely 30ft from the house, dripping ooze into a viscous pool the color of oil. Directly above the sewage pool, a separate narrow-gauge pipe ran up to the house, which turned out to be the main channel carrying drinking water to the residents.

The open sewer was festooned with mosquitoes, and a long cordon of ants could be seen trailing along the waste pipe from the house. At the end of the pool nearest the house the treacly fluid was glistening in the dappled sunlight – a closer look revealed that it was actually moving, its human effluence heaving and churning with thousands of worms.

The Guardian

Ed Pilkington - Hookworm, a disease of extreme poverty, is thriving in the US south. Why?y

Brutal poverty in the US South is caused by globalization

Celebrated writer Paul Theroux has experienced a wide variety of the best and worst around the world, but his eye opening experience in America’s Deep South has garnered a lot of criticism, as he compares the region to Third World countries in South America and Africa. He explains his latest work and what has caused the economic decline to Alexey Yaroshevsky.

The Intercept — As John Conyers Departs From Judiciary Committee Spot, The First Battle of the Anti-Monopoly Era Begins — The Intercept As John Conyers Departs From Judiciary Committee Spot, The First Battle of the Anti-Monopoly Era Begins

Conyers on Sunday announced he is stepping down as the top-ranking Democrat on the Judiciary Committee, launching a battle for his successor that has pitted two Democratic rivals — Lofgren and Rep. Jerrold Nadler, D-N.Y. — against each other. On the one hand, his resignation comes in a politically fortuitous way for Lofgren, with Conyers felled not by age but by allegations of sexual harassment. The political logic of replacing him with a woman is obvious. But then there’s Google.

The race for committee chair threatens to become the first fight over monopoly politics after the rollout of House Democrats’ “Better Deal” platform for 2018, which was built on going after concentrated power, particularly in the tech sector. Elected to Congress in 1994, Lofgren represents San Jose and the Bay Area, and is far and away the most stalwart defender of big Silicon Valley firms among House Democrats.…

In the immediate wake of the news of Conyers’s decision, an aide to House Minority Leader Nancy Pelosi, D-Calif., told the New York Times reporter who broke the story that Nadler would take over in an acting capacity.

Nadler is next in line due to his seniority, but Lofgren, who is just behind Nadler, has been calling colleagues to gin up support to challenge him, according to Democratic members of the committee who spoke on condition of anonymity so as not to get in the middle of a fight between two colleagues. If Democrats take over the House of Representatives in the 2018 midterms, the lawmaker in the acting role would have an inside track to become full committee chair.

The committee will meet for a vote as soon as Wednesday, so Democrats have precious little time to sort things out. Nadler has effectively announced his plan to take the reins, but Lofgren wants a full caucus vote on who should get the seat. (Complicating matters is Conyers’s professed plan to return to the seat after the ethics probe into sexual assault allegations is over, a plan few Democrats want to see implemented and even fewer think is possible.)...

Democrats really need to get beyond the perception that they are the party of Wall Street, Silicon Valley and Hollywood.

The Intercept
As John Conyers Departs From Judiciary Committee Spot, The First Battle of the Anti-Monopoly Era Begins
Ryan Grim

John T. Harvey — Dear President Trump: Your Tax Plan Needs Bigger Deficits!

What I want to highlight here is this: the private sector needs government deficit spending if it is going to recover properly from both the heart attack of the Financial Crisis and the decades of disease brought on by income redistribution and rising debt levels. This is so because government deficits are private-sector surpluses.

The logic is really very simple. What number do you get when you add up every trade surplus and trade deficit on the planet? Zero, of course, because one nation’s trade surplus is another’s trade deficit. This is a specific application of the general rule that in any closed system, the sum of all deficits and surpluses must be zero. If you and I are the only two people in the economy and I spend more than I earn, then you earn than you spend (and by the exact same amount, of course). There aren’t many inescapable truths in life, but this is one.

Now think about the U.S. government budget deficit. If Washington is spending more than it earns, then non-Washington must be earning more than it spends. In 2016, for example, the US federal government spent $585 billion more than it collected in taxes.

That money did not disappear in a puff of smoke. It became the excess of income over spending earned by non-Washington. Non-Washington had a $585 billion surplus or, which is the same thing, $585 billion of savings.

This is an inescapable accounting truth and it implies that any tax plan that hopes to stimulate the private sector must create a budget deficit. Federal government budget surpluses drain non-Washington income. That’s hardly what we need. Pundits and policy makers need to stop worrying about Washington’s deficit and start focusing on non-Washington’s surplus.

“Wait,” you may ask, “true or not, doesn’t this just lay the foundation for bigger problems in the future?” Almost certainly not. Let me address a few of the most common worries:

Forbes — Pragmatic Economics
Dear President Trump: Your Tax Plan Needs Bigger Deficits!
John T. Harvey | Professor of Economics, Texas Christian University

Reuters — Trump: 'I don't see a deal' with Democrats on keeping government open

Here we go again.

Reuters
Trump: 'I don't see a deal' with Democrats on keeping government open
Reuters Staff

So there!

Zero Hedge
Top Democrats "Abruptly" Pull Out Of White House Meeting After Trump Twitter Attack

Tyler Durden

Ted Galen Carpenter — The Duplicitous Superpower

For any country, the foundation of successful diplomacy is a reputation for credibility and reliability. Governments are wary of concluding agreements with a negotiating partner that violates existing commitments and has a record of duplicity. Recent U.S. administrations have ignored that principle, and their actions have backfired majorly, damaging American foreign policy in the process.…

In some cases, the US is unable to keep its agreements or honor its word over time, and in other cases it has no intention of doing so right from the outset of making the agreement.

The American Conservative
The Duplicitous Superpower

Ted Galen Carpenter, senior fellow in defense and foreign policy studies at the Cato Institute

Stephen F. Cohen — Russia Is Not the ‘No. 1 Threat’—or Even Among the Top 5

By declaring Putin’s Russia to be the greatest danger to America, the political-media establishment itself is endangering US national security.

The Nation
Russia Is Not the ‘No. 1 Threat’—or Even Among the Top 5
Stephen F. Cohen | professor emeritus of Russian studies and politics at New York University and Princeton University, and a contributing editor of The Nation.

See also

Counterpunch
Suddenly, I’m a ‘Russian Agent’!

Dave Lindorff, investigative reporter, founding member of ThisCantBeHappening!, an online newspaper collective, columnist for CounterPunch, and a contributor to Businessweek, The Nation, Extra!and Salon.com.

Bill Mitchell — The EMU reform ruse – Part 1

On October 31, 2017, my blog – Europhile Left deluded if it thinks reform process will produce functional outcomes – countered some of the nonsense coming out of Europe (from the so-called progressive side) that the Eurozone hadn’t failed when judged by it bias towards mass unemployment and increasing precariousness of its citizens. I particularly noted the terrible record in terms of youth unemployment and NEETs. Yesterday’s blog – Massive Eurozone infrastructure deficit requires urgent redress – documented how much damage the austerity bias of the Eurozone has caused to essential productive infrastructure – human and physical and the ridiculous underinvestment by governments locked into mindless Stability and Growth Pact (and its recent derivatives) rules. Unphased, the Europhiles keep telling me that reform processes are underway and that we need to be patient. That the glorious vision outlined in the October 1990 European Commission Report – One Market, One Money Report, which, apparently outlined a vision of domestic-demand driven convergence bliss for the Economic and Monetary Union. I analysed that Report in detail in my 2015 book – Eurozone Dystopia: Groupthink and Denial on a Grand Scale – and have to say that anyone who holds it out as a plan for the future must have been reading a different report or affected by heavy drugs. Today, I am considering recent reform proposals put forward by German academic Fritz Sharpf, who considers the neoliberal Eurozone experiment has failed but can be resurrected without abandoning the essential mechanics of the monetary union. Tomorrow, I will conclude. It will not surprise regular readers to know that I disagree with Sharpf’s reform agenda....

I appears to me that the problem in the EZ is not so much neoliberalism, which is chiefly Anglo-American, as it is German ordoliberalism.

Neoliberalism reflects the pragmatic nature of the Anglo-American world.

Ordoliberalism reflects the German preference for a rules-based system in which rules are strictly adhered to regardless of outcomes. This choice is based on the assumption that sticking to the rules will eventually produce the desired result. So far, Germany has been unbending on sticking to the rules (except when it suits Germany).

Bill Mitchell – billy blog
The EMU reform ruse – Part 1
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

CFPB Mulvaney presser

Not much here. Says he is going to take 30 days to study the situation; ie more lethargy from the Trump administration.

Acting CFPB Director Mick Mulvaney Holds Brilliant Press Conference - Video... https://t.co/AlXjh5tL69 via @thelastrefuge2
— Paul Webster (@plwtigers) November 28, 2017

Jimmy Dore - What CNN Wont Tell You About War

Jimmy Dore is an excellent satirist who mixes serious politics with comedy which keeps his show really interesting. I would say that Jimmy Dore's politics and mine were about the same. Here he takes a satirical looks at the US military-industrial complex.

Max Blumenthal - GRAYZONE PROJECT - Exposing the Shocking and Continuing Alliance Between Zionism and Anti-Semitism

An in-depth discussion with renowned Palestinian scholar Prof. Joseph Massad.

Alternet

Max Blumenthal - GRAYZONE PROJECT - Exposing the Shocking and Continuing Alliance Between Zionism and Anti-Semitism

According to this report the antisemitics in Europe drove the Jews out of their countries and this was exactly what the Zionists wanted as they hoped many of the Jewish evacuees would go to Palestine although most went to the USA instead.

Excerpt -

On the eve of Trump’s election, Gorka appeared in nationally televised interviews clad in a black uniform bearing the medal of the Vitezi Rend, a Hungarian fascist group that collaborated with the Nazis during the Holocaust. Speaking at a conference organized by the right-wing Israeli newspaper the Jerusalem Post in May, Gorka defended his wearing the medal, proclaiming, "My father was awarded a medal in 1979 by anti-communist members of a splinter order outside Hungary ... I am proud to wear that, as a response to everything that we face today."

At its annual gala this November, the Zionist Organization of America (ZOA) feted Sebastian Gorka alongside fellow Trump White House alumni Steven Bannon and Sean Spicer. The ZOA’s president, Morton Klein, has established a special relationship with the Trump administration, going out of his way to defend Gorka against accusations of Nazi sympathies.

Vitzezi Rend has appeared on a US State Department list of "organizations under the direction of the Nazi government of Germany,” and its late founder, Miklos Horthy, reportedly declared, "I have always been an anti-Semite throughout my life.” During the anti-communist White Terror that took place between 1919 and 1921 in Hungary, Horthy presided over some 60 pogroms, and attacks on Jews continued through the 1920’s. When Nazi Germany occupied Hungary in 1944, Horthy participated in the deportation of 437,000 Jews to concentration camps.

Gorka’s attachment to a fascist order that reveres Horthy and his anti-Jewish legacy has not appeared to trouble supporters of Israel’s right-wing government. Not only has Gorka been an honored guest of the ZOA, he was welcomed by the Jerusalem Post, which received him with warm applause and a prominent speaking slot at its annual conference this May in New York. “The real agenda is clear: Gorka has written forcefully about the need to defeat the jihadi threat to Western civilization,” an op-ed defending Gorka in the Jerusalem Post read.

Paul Craig Roberts - Can’t You See War On The Horizon?

According to news reports in the British press, Russian President Vladimir Putin has instructed Russia’s industries to prepare themselves to be able to make a quick switch to war production. http://www.independent.co.uk/news/world/europe/vladimir-putin-russia-business-war-production-sochi-military-talks-a8069951.html

Clearly, the Russian government would not make such an announcement unless it was convinced that the prospect of war with the West was real. For some time I have emphasized in my columns that the consequence of years of hostile actions taken by Washington and its European vassals against Russia was leading to war.

****

Think about this for a moment. The world is being driven to Armageddon simply because a greedy and corrupt US military/security complex needs an enemy to justify its huge budget, because Hillary and the DNC cannot accept a political defeat, and because the neoconservatives have an ideology of American Supremacy. What’s the difference between the detested White Supremacy and the American Supremacy that President Obama himself endorsed? Why is white supremacy terrible and American supremacy God’s gift to the “exceptional” and “indispensable” country?

Paul Craig Roberts - Can’t You See War On The Horizon?

Monday, November 27, 2017

Jessica Corbett - 'Alarm Bells Should Start Ringing' as Koch Brothers Invest $650 Million to Create 'Media Megaphone'

A media company backed by the conservative billionaire brothers will acquire Time, Fortune, People, and Sports Illustrated magazines

Critics of media consolidation and the fossil fuel industry are decrying an announcement that the media company Meredith Corp., with a $650 million boost from conservative billionaires David and Charles Koch, will buy Time Inc.—which owns Time, Fortune, People, and Sports Illustrated magazines—for an estimated $2.8 billion.

In a statement announcing the all-cash deal, Meredith Corp. insisted that Koch Equity Development—a subsidiary of Koch Industries, the billionaire brothers' company that's largely been built through investments in oil, natural gas, and chemicals—"will not have a seat on the Meredith Board and will have no influence on Meredith's editorial or managerial operations."

"But not everyone believes the spin," as Andy Rowell writes for Oil Change International. The Kochs are "some of the biggest funders of groups promoting climate denial and libertarian causes for the last two decades," he notes. "Alarm bells should start ringing."

Common Dreams

Jessica Corbett - 'Alarm Bells Should Start Ringing' as Koch Brothers Invest $650 Million to Create 'Media Megaphone'

On Contact: Decline of the American empire with Alfred McCoy

An excellent account of where America has gone wrong. At the end of the interview Alfred McCoy says how Obama was a brilliant strategist who was cutting China out of Western markets through trade deals which would have halted its rise but neoliberalism had disenfranchised so many working people that they voted for Trump who run on a populist ticked who wanted to end these deals. You can see here another reason why Trump was certainly not the leader the US elite wanted.

Alfred McCoy, Harrington Professor of History at the University of Wisconsin-Madison, explains the decline of the United States as a global power and the rise of the Chinese empire.

The Saker — Book excerpt: How I became a Kremlin troll

Today, with the kind permission of Phil Butler, I am posting the full text of my contribution to his book “Putin’s Praetorians: Confessions of the Top Kremlin Trolls“. There are a couple of reasons for that....

The Vineyard of the Saker
Book excerpt: How I became a Kremlin troll
The Saker

Bryan Caplan — Consciousness is All-Important: The Case of Signaling

I say the challenge in Robin's final sentence is easily answered: Conscious intentions are all-important for the welfare analysis of signaling. Standard signaling models assume that people dislike sending the signal. It is this assumption that implies that signaling equilibria are highly inefficient - or even full-blown Prisoners' Dilemmas. If people enjoyed signaling, in contrast, signaling equilbria could easily be ideal. What superficially appears to be a vast zero-sum game turns out to be fine because the players like playing the game....

Econlog
Consciousness is All-Important: The Case of Signaling
Bryan Caplan | Professor of Economics, George Mason University

Michael Roberts — Neoliberalism works for the world?

[Noah] Smith is keen to refute the ‘mixed economy’, anti free trade ideas that have been sneaking into mainstream economics since the Great Recession, namely that ‘neo-liberalism’ and free markets are bad for living standards. Instead, a little dose of protectionism on trade (Rodrik) and state intervention and regulation (Kwak) helps capitalism to work better.

But no, says Smith. Neoliberalism works better. He cites China’s growth phenomenon as his main example! In China, “the shift from a rigid command-and-control economy to one that blended state and market approaches — and the liberalization of trade — was undoubtedly a neoliberal reform. Though Deng’s changes were mostly done in an ad-hoc, common sense manner, he did invite famed neoliberal economist Milton Friedman to give him advice.”

He then adds India to this argument: “A decade after China began its experiment, India followed suit. In 1991, after a sharp recession, Prime Minister Narasimha Rao and Finance Minister Manmohan Singh scrapped a cumbersome system of business licensing, eased curbs on foreign investment, ended many state-sanctioned monopolies, lowered tariffs and did a bunch of other neoliberal things.”

Boy, does this take the biscuit. China’s economy is an example of successful neoliberal economic policy!? In several posts I have shown that China is not a free market economy by any stretch of the evidence and may not even be described as capitalist. It is state-owned and controlled with investment and production state-directed, with profit secondary to growth as the objective. Indeed, the IMF data on the size of public investment and stock globally put China in a different league compared to any other economy in the world.

As for India, the state sector also remains significant, something which continually upsets the World Bank and neoliberal economists. The policy measures of the 1990s can hardly be used as the explanation of the pick-up in economic growth in India. During the 1990s, productivity growth in all the major ‘emerging economies’ picked up – only to fall back again after the Great Recession. Globalisation and foreign capital were drivers then everywhere.

Anyway it is not really true that Indian government policy is ‘neo-liberal’ – on the contrary. In contrast, the clear shock switch to neoliberal capitalism by Russia’s post-Soviet governments and its oligarchs was a total disaster (Smith calls it a ‘mixed success’!). Growth, living standards and life expectancy collapsed. Indeed, the conclusion that might be drawn is not that ‘neo-liberal reforms’ have driven the relative economic success of China and India in the last 30 years but their resistance to such policies....

Michael Roberts Blog

Neoliberalism works for the world?
Michael Roberts

Sputnik — Deadly Political Games: Italian Journalist Blows Lid Off Maidan Snipers Mystery

Italian journalist Gian Micalessin's interviews with three Georgian mercenaries who took part in the shooting massacre of protesters and police in Kiev in early 2014, and led to the overthrow of the Ukrainian government, have dismantled the new government's account of the tragedy. Micalessin spoke to Sputnik about the implications of his findings.

Sputnik International
Deadly Political Games: Italian Journalist Blows Lid Off Maidan Snipers Mystery

The Vineyard of the Saker
The hidden truth about Ukraine, a documentary (MUST SEE!)
Gli Occhi della Guerra

The Vineyard of the Saker
Snipers at Ukraine’s Maidan confess to shooting both sides in Italian report ignored by MSM
Ramin Mazaheri

Pages

Thursday, November 30, 2017

Wednesday, November 29, 2017

Tuesday, November 28, 2017

Brutal poverty in the US South is caused by globalization

An in-depth discussion with renowned Palestinian scholar Prof. Joseph Massad.

Monday, November 27, 2017

A media company backed by the conservative billionaire brothers will acquire Time, Fortune, People, and Sports Illustrated magazines