The fictional 'center'

Greetings good citizen,

What better day than Superbowl Sunday to have a, can’t really call it a discussion, I guess we’ll have to refrain from labeling this exercise…

Anyhoo, I’ve come across another article that raises the thorny issue of what politics has to do with economics (or, if you prefer, vice-versa.) A politician can’t force an employer (at least a specific one) to hire you or to pay you a living wage…(which casts the ‘minimum wage’ issue in a rather different light, doesn’t it?) So why are so many of us inclined to blame the president for a lousy economy?

Why are congressmen quick to stick a feather in their hat (take credit) for ‘bringing home the bacon’ (commonly referred to as ‘pork’ when the so-called bacon goes to another district…even if you got yours!)

Not that this particular article takes such a ‘holistic’ view of the subject (mostly because it was written by an ‘academic economist’ with no practical experience in how a ‘real’ economy works…albeit, that didn’t stop the NY Times from publishing this piece.)

To be fair, even economists employed by prestigious investment firms are clueless as to how a ‘real’ economy operates, their minds so filled with bogus theories and models which still include slavery as part of the equation. (That which you are forced to do against your own self-interest can hardly be considered ‘free-will’. It is here that we find the connection between ‘economics’ and, er, to be succinct, politics/the law.)

This adds yet another dimension to this ‘investigation’ into the connection between politics and economics.

What you need to be mindful of here good citizen is who gets to write the law as well as who benefits from the manner in which they are written…let us not forget who gets what for playing along…(the ‘politics’ part of the puzzle.)

Ironically, there is no way the average individual can come away from this examination without concluding the system itself is deeply flawed as well as badly broken.

That said, onward with tonight’s offering

Economic View
Why Politics Is Stuck in the Middle

By TYLER COWEN
Published: February 6, 2010

MARKET competition, under the proper circumstances, has the power to make a business better serve its customers. Cellphone companies, for example, compete via cheaper prices, clearer connections and better apps. Political competition, though no less vigorous, is conducted on very different terms — and often ends up stifling innovation instead of encouraging it.

When viewed through an economist’s lens, the quest for voter approval helps explain some recent developments in domestic politics, including the stalling of health care reform and the proposed freeze on the federal government’s discretionary spending.

Economists approach political competition with a simple but potent hypothesis called the “median voter theorem.” Anthony Downs, a senior fellow at the Brookings Institution, proposed the idea in his 1957 book, “An Economic Theory of Democracy.” Essentially, the idea is this: Any politician who strays too far from voters at the philosophical center will soon be out of office. [Um, how many of you see that the ‘philosophical center’ is so vaguely defined as to be non-existent? Worse is the reality that whoever defines what that center is, controls that value! Which is to ask, ‘does the center even know what the center is?’ Obviously not!]

In fact, there is a dynamic that pushes politicians to embrace the preferences of the typical or “median” voter, who sits squarely in the middle of public opinion. A significant move to either the left or the right would open the door for a rival to take a more moderate stance, win the next election and change the agenda. Politicians will respond to this dynamic, whether they are power-seeking demagogues or more benevolent types who use elected office to help the world. [Hold this idea up against our own ‘practical experience’ and what do you have? A war that not only continues to be funded, but is being escalated by the very man we elected to stop it! The nation ‘overwhelmingly’ wants this ‘war of choice’ terminated BUT the ‘analysts’ in Washington/Wall Street have determined that a totally fictional ‘centrist’ would choose otherwise! So our politicians feel ‘safe’ ignoring the mandate of a vast majority of the people that apparently are NOT in the damned ‘center’! Lost? This brings us full circle with the notion that whoever defines the center gets to determine what the center wants, regardless of what the rest of us vote for/desire!]

When it comes to the big issues, voters at the midpoint usually get the policies, if not always the exact outcomes, they want. In the federal budget, the largest line items include Social Security, Medicare, Medicaid and military spending — all very popular programs. The interest on the national debt is mounting because we don’t like paying higher taxes now for all those benefits, so our government borrows to postpone the pain. [‘Our’ government? Does this guy have a mouse in his pocket? Didn’t we just get through determining that since we obviously aren’t ‘in the center’ the government would be foolish to pay attention to what we want…which works out real well for those oligarchs who believe democracy is a ‘bad idea’. Speaking of which, how many of you are wondering ‘how do we change this’? Voting certainly isn’t the answer, it doesn’t matter what/who you vote for if only the (fictitious) ‘center’ matters…]

Upon his election, President Obama stepped into a world already full of political constraints. He won the White House and significant Democratic majorities in both the House and the Senate — yet even if American voters were tired of the Republican Party, it’s not clear that their underlying opinions had changed very much. [Talk about alarming! We haven’t seen a strong shift away from Republican values because the Republicans are still making the decisions! The ‘dolts’ we elected have no idea how to behave like Democrats! Which is just as incredible as asserting these people can’t read (we know they don’t but they are supposedly capable of it) nor do they understand what they see on television! (Or so we are supposed to believe.)

Correctly or not, most Americans have failed to embrace the Democratic health care plans. And ever since the Republicans won the special Senate election in Massachusetts, even the Democrats in Congress have stalled on the legislation. It now appears that much of the initial support was thin. [Um, I probably should have mentioned this earlier but Mr. Cowen is a noted ‘conservative’. Um, as I have commented earlier, I had the polls to myself when I cast my vote for Martha Coakley although my tiny town on the north shore of Massachusetts usually votes red. Rich people always live near the ocean. Which is to point out that I live on the western border of my town.]

Senate Democrats, for instance, could overcome a Republican filibuster through a parliamentary process known as reconciliation, but they are waiting, evidently out of fear that voters aren’t with them on this issue. [Flip that on its head and you have Republicans ‘hoping’ they are right! Which is to point out the extreme foolishness of anyone trying to hold onto an elected position by defying the will of the people who put them in office…but that’s what’s happening and it should tell you something. What should it tell you? The ballot box is broken for anything larger than a local election; that’s what it tells you.]

Many people are increasingly worried about deficits. That may have led Mr. Obama to announce a freeze on nonmilitary discretionary spending, and yet this freeze refuses to target major, popular budget items like Social Security. The public seems to want the self-image of being tough on spending without giving up the goodies. President Obama may well know better, but he is doing his best to oblige, if only to prevent a Republican landslide this November. [The Republicans couldn’t win in a landslide if they were the only ones running since they are directly responsible for the current crisis that has been forty years in the making.]

The point here is not to belittle or praise the president, but to point out that his hands are tied. The biggest leftward move in American economic policy occurred during the Roosevelt and Truman years, when the Democrats had the upper hand for five consecutive presidential terms. Because of depression and war, people were looking for real change. Competitive forces in politics were relatively weak, and the Democrats had the chance to make their policies stick. [It worked so well Republican’s had to run as Democrats to gain office. That seems to be our problem now, Republicans have to run as Democrats to win, yet they still behave like Republicans! Not so sure that’s going to work out too well once the dust settles.]

The Supreme Court’s recent ruling on campaign spending also comes into clearer focus through the median voter theorem. The court ruled that the government may not ban political spending by corporations in candidate elections. Critics fear that the political influence of corporations will grow, but some academic specialists in campaign finance aren’t so sure. [Um, would that ‘academic specialist’ crack be an opaque reference to himself? Understand only one in five voters are registered Republicans, sadly, even less than that are rich and the Republican Party is the party of the wealthy. The conservatives are greatly outnumbered but their pockets are much deeper than those of the ‘paycheck peasants’ are.]

For all the anecdotal evidence, it’s hard to show statistically that money has a large and systematic influence on political outcomes. That is partly because politicians cannot stray too far from public opinion. (In part, it is also because interest groups get their way on many issues by supplying an understaffed Congress with ideas and intellectual resources, not by running ads or making donations.) It is quite possible that the court’s decision won’t affect election results very much. [Se habla ‘Swift boats’? Imagine Swift boats times ten! Most candidates wouldn’t run to save their families the humiliation of having their name dragged through the mud! That’s the kind of ‘free speech’ the Supremes are ‘protecting’! Lies don’t have to be true to be effective.]

Of course, the median voter theorem is far from a complete explanation of politics. Sometimes politicians lead public opinion and talk voters into accepting new ideas, as when President Bill Clinton promoted Nafta. And voters often favor conflicting or contradictory policies, like wanting to pull troops out of Iraq but also not wanting Iraq to explode into chaos. [Okay, Conservative idiots love to play up the idea that Bill Clinton initiated NAFTA but it wasn’t Billy Boy at all, it was dear old St. Ronnie! Here’s another piece of ‘political economics’ that defy rational explanation! Nobody liked it but the conservatives rammed it through a Democratic presidency, not that ‘the man who killed welfare’ was much of a Democrat.]

Finally, most people aren’t very well informed about politics and can be downright irrational or stubborn, which is another reason that political competition isn’t always as beneficial as economic competition. [We an only guess not wanting what is good for our oligarchs is considered irrational or confused with ‘stubbornness’ when it comes to political compromise.]

THE median voter theorem doesn’t predict that the legacy of the Obama administration will be a wash. But it does imply that we might find the most important achievements in areas that don’t always linger on the front page. For instance, the president’s ideas on education, which involve accountability and charter schools and pay for performance, may please the American public and thus make their way into policy. And because education transforms the knowledge and interests of the median voter for generations to come, such acceptance could make for a lot of other improvements.

If you’re looking for change to believe in, and change that will last, the odds are best when political competition is pushing the world in your direction.

Tyler Cowen is a professor of economics at George Mason University.

Obviously it doesn’t hurt to be the one defining what the political center is either! Especially when it comes to goofball theories that conservatives dream up!

What I wanted to point out here is how ‘empty’ or devoid of reason this article is…because if you’re a conservative, you don’t need proof or reason, it is merely because you say it is so!

Which doesn’t explain how this piece made it into that ‘Liberal rag’ the Sunday New York Times…unless it is not nearly as ‘liberal’ as the conservative pinheads claim it is…

Yes, good citizen, I came looking for a good argument but being a conservative means never having to defend your beliefs…we can leave aside the fact that their beliefs are generally indefensible…

Back to the subject at hand…how are politics and economics related? You already know the answer. Economics are pure politics, in fact without economics there wouldn’t be any politics, which sort of overstates the situation but there it is.

If it weren’t for some people constantly trying to ‘get over’ on everybody else we wouldn’t need politics or the political games that provide cover for weasely behavior. Um, simply put politics exist to lend respectability to the reprehensible. It is the, I really hesitate to call it ‘art’ but it is in its own way, of obtaining permission for that which is objectionable. This is why law runs the entire gamut from the obvious to the sublime. It is the laws that make the most sense that provide the justification for laws that make little sense.

I am no fan of lawlessness (although I am a big fan of Anarchy, whose true meaning is ‘rules without rulers!’) So while I am no fan of law as it is currently practiced that doesn’t mean I despise the law.

Nor am I much a fan of self-serving conservative rhetoric.

Thanks for letting me inside your head,

Gegner

The Home Stretch

Greetings good citizen,

Some things continue to amaze me and one of them is how some people can display such a firm grip on the problem only to reveal they are utterly clueless to the solution.

Sadly, tonight’s offering provides both as poignantly as imaginable. This piece is so spot on in identifying what is amiss with our so-called leadership and so clueless when it comes to the solution that it is a wonder his head doesn’t explode!

Um, when you get to the end of the piece you will be sure of one thing…one of us has a problem.

Without further adieu,

Welcome to tonight’s offering

Time Is Running Out

By BOB HERBERT
Published: February 5, 2010

Palo Alto, Calif.

We’ve now lost 8.4 million jobs in this recession, and a vast majority of them are gone for good. The politicians are clambering aboard the jobs bandwagon, belatedly, but very few are telling the truth about the structural employment problems in the U.S. and the extremely heavy lift that is necessary to halt our declining living standards and get us back to an economy that is self-sustaining. [This is perhaps one of the most colossal ‘open secrets’ ever perpetrated on an entire nation. To Mr. Herbert’s credit, he tells it like it is, instead of giving our politicians the ‘benefit of the doubt’, he rightly accuses them of lying, which they are.]

We don’t hear a lot that is serious about the sorry state of the nation’s infrastructure or the trade policies that crippled so many American industries. Or our inability (or unwillingness) to compete effectively with China(‘s) [Currency manipulation] when it comes to the new world of energy for the 21st century. Or our abject failure to provide a quality public education for the next generation of American workers, scientists, artists and entrepreneurs.[ Okay, that little bit of ‘mis-direction’ aside, the failure is not one of education but of opportunity, our economy wouldn’t be ‘broken’ if not for the greed of financiers! This is treason of the highest order!]

Speaking at a conference here on Wednesday, Gov. Ed Rendell of Pennsylvania said that if we don’t act quickly in developing long-term solutions to these and other problems, the United States will be already is a second-rate economic power now by the end of this decade. A failure to act boldly, he said, will result in the U.S. becoming “a cooked goose.” [What ‘bold acts’ do you suppose it will take to save the US economy? Anyone? Bueller? Anyone?]

Neither the politicians nor much of the mainstream media are spelling out the severity of these enormous structural problems or the sense of urgency needed to address them. Living standards are sinking in the United States, and there is no coherent vision or plan for reversing that ominous trend over the long term. [Understand what this means good citizen, ‘welcome to the world’s newest ‘Banana Republic.’ Where the rich screw the poor with impunity!]

The conference was titled, “The Next American Economy: Transforming Energy and Infrastructure Investment.” It was put together by the Brookings Institution and Lazard, the investment banking advisory firm.

When Governor Rendell addressed the conference on Wednesday, he used words like “stunning” and “unbelievable” to describe what has happened to the nation’s infrastructure. His words echoed the warnings we’ve been hearing for years from the American Society of Civil Engineers, which tells us: “The broken water mains, gridlocked streets, crumbling dams and levees, and delayed flights that come from failing infrastructure have a negative impact on the checkbook and on the quality of life of each and every American.” [The ‘problem’ is much deeper than ‘incompetence’ and it’s important to recognize that capitalism itself is directly responsible for the decay. None of this will be fixed using the bankrupt politics of greed.]

The conference was sparked by a sense of dismay over what has happened to the U.S. economy over the past several years and a feeling that constructive ideas about solutions were being smothered by an obsessive focus on the short-term in this society, and by the chronic dysfunction and hyperpartisanship in much of the government. [Um, have you heard any ‘constructive ideas’ lately? I haven’t. We tried what the ‘Party of ideas’ laid out and it only made a bad situation worse, what other ideas are there?

I was struck by the absence of grousing and finger-pointing at the conference and the emphasis on trying to develop new ways to establish an economy that is not based on financial flimflammery, that enhances America’s competitive position in the world, and that relieves us of the terrible burden of reliance on foreign energy sources. [Ironically good citizen, even renewable energy won’t save us beyond the immediate future and, more importantly, this ‘competition bullshit’ has to go! It only serves the ‘owners’, the rest of society gets nothing!]

I was also struck by the pervasive sense that if we don’t get our act together then the glory days of the go-go American economic empire will fade like the triumphs of an aging Hollywood star. One of the participants raised the very real possibility of Americans having to get used to living in an economy “that won’t be number one,” an economy that perhaps is more like Germany’s. [The fucking horror! I don’t know how people can stand the idea! WTF! Understand good citizen that there are far worse things than not living in the world’s leading economy…and we’re about to experience them for ourselves!]

Rescuing the U.S. economy will require a commitment, and undoubtedly sacrifices, that need to start now. And it will require leadership that pulls together the best talents from all sectors of the society — not just business, not just government, but from everywhere.[Um, I couldn’t agree more with the ‘sacrifices’ although I doubt we’re on the same page regarding who needs to make them. We should, logically, start with the fat-heads responsible for this cluster fuck!]

Bruce Katz, the director of Brookings’ Metropolitan Policy Program, discussed some of the steps that need to be taken to remake an economy that has been thrown completely out of whack by frantic, debt-driven consumption, speculative bubbles, exotic financial instruments, and so on.

A new, saner, more sustainable economy will have to be more export-oriented, powered by cleaner fuels, bolstered by innovation that comes from a renewed focus on research and development, and committed to delivering a better-educated, more highly skilled work force. [Uh, how many of you are shaking your heads with disbelief thinking ‘good luck with that!’ ?]

Mr. Katz believes this is doable, but by no means easy. The nation’s infrastructure, he said, will have to “shift from 20th-century models of transport and energy transmission to rapid bus, ubiquitous broadband, congestion pricing, smart grid, high-speed rail and intelligent transport.” [Um, what the fuck is ‘intelligent transport’? There are several things this could imply with only a couple of them being actually ‘intelligent’.]

New ways of financing such transformative changes will have to be developed, linking public and private capital, preferably through the creation of a national infrastructure bank, [WTF! Haven’t the banksters done enough?] among other things. The nation’s political leaders and the public at large will have to grasp the difference between wasteful spending and crucial investments in the future.

It’s time for serious people to step forward and help lead on these critically important issues. Time is short.

Hard to say where to begin here good citizen, isn’t the President’s stimulus plan designed around this nation’s crumbling infrastructure? Here we are a year later and roads that were paved a year ago have a fresh layer of asphalt on them…not for any particularly good reason, maybe it was done because the permits were still in place?

But understand good citizen, nobody got a ‘new job’ out of the deal. The same contractors who did the work the first time did the job they just finished, again.

I’ll bet my state wasn’t the only one to play this game, I’m sure a lot of other contractors got the same deal. Rather than laying off their crews this winter they were kept working.

Um, so we need a ‘new way’ to finance public works projects. Here’s an idea, considering Mother Nature doesn’t have a cash register, meaning the materials to do the job are free…ironically, ALL of the materials, dump trucks, bulldozers and all are free. Maybe we don’t need to think up a ‘new way’ to pay for them. Maybe we should do what we always should have done, allocate the resources and the manpower and get the damn job done! (It’s not like we don’t have 50% of our workforce sitting idle, do we?)

Then there’s the ‘competitiveness’ issue to deal with. Remove price from the equation and the playing field becomes perfectly level…it’s not about price, its about doing what needs to be done!

There is no such thing as ‘we can’t afford it’ unless we’re talking about the ‘currently impossible’. The issues facing us in the near future are issues we can’t afford to NOT address!

If we are to save our species from self-annihilation we need to become mighty thankful that Mother Nature doesn’t have a cash register…and we have to put a stop to those who would try to convince you otherwise.

Long-time readers know that we would still need cash but the reason why would change. Your money is for you. You, you and only you.

At the end of the day, civilization/society has no use for money, only the individual needs it…and that’s the ‘change’ we can’t make soon enough!

Thanks for letting me inside your head,

Gegner

Not now, not ever...

Greetings good citizen,

We were warned more than six months ago that 1.5 million people were in danger of exhausting their unemployment benefits by January.

Well guess what? January is here and what do you suppose the headline says? “Labor Market Shows Signs of Reawakening in New Data.”

How can they call this ‘new data’ if the information is more than six months old? Naturally, it is not the information that is ‘new’, it is the ‘spin’ that has changed…now dire news is being used to inspire more unfounded, baseless ‘happy talk’.

What you want to look at (because the figure is immune from the ‘selective banishment’ they use to dress up the unemployment numbers) is the labor force participation rate (see the graph at the bottom of the linked article.)

What does this tell us? Well two-thirds is 66%, and the participation rate is 64.6% so one out of three working aged citizens doesn’t…work that is. To make matters worse, 40% of those who do have jobs only work part time.

Is this any way to run a society? It is if you’re a selfish pig!

But what can we expect from the kind of people that brought us this headline?

Labor Market Shows Signs of Reawakening in New Data

By PETER S. GOODMAN and JAVIER C. HERNANDEZ
Published: February 5, 2010

The American unemployment rate dipped from 10 percent to 9.7 percent in January, the Labor Department reported Friday, buoying hopes that the worst job market in at least a quarter-century is finally improving. [Why would any sane person think that? The evidence doesn’t agree!]

The economy shed another 20,000 net jobs during the course of the month, underscoring the considerable strains remaining in millions of American households. Yet that marked a continued decline in the pace of deterioration. Economists focused on a host of encouraging signs that suggested recovery following the worst recession since the Great Depression. [How about one specific example? Just one…]

Manufacturing added 11,000 jobs in January, the first monthly increase since November 2007, while factories saw a modest increased in the length of the workweek. Temporary workers grew by 52,000, and the overall American workweek lengthened, reinforcing the view that commercial activity is awakening after more than two years of veritable hibernation. [Uh, is it too much to ask for one specific example? All we have here are jobs created by BLS software! Jobs that so far have proven to be totally imaginary!]

“It does signal that the economy is continuing to improve,” said John E. Silvia, chief economist at Wells Fargo in Charlotte, N.C. “You don’t have a boom, but you have an economic recovery. It’s a positive sign.” [What’s a ‘positive sign’? The ambiguous ‘lengthening’ of the workweek, they don’t even tell us how much it supposedly increased or where we could find proof of such a claim! I don’t know about you good citizen but this ‘trust me’ crap coming from this pack of liars doesn’t hold any water with me…]

Yet despite the hopeful indications, the government’s monthly snapshot of the labor market came wrapped in an unusual degree of statistical uncertainty, economists said, intensifying the debate about the staying power and vigor of the apparent economic recovery. [The so-called ‘recovery’ is piece of convenient fiction that even our politicians don’t believe!]

The Labor Department revised past data to show that the economy comprised 1.36 million fewer jobs in December than previously thought. The revisions showed the economy lost 150,000 jobs in December — far more than the 85,000 initially reported. [Yeah, the economy is ‘turning around’ all right, doing damn 360’s while it sails off a cliff is what it’s doing!]

The report also featured a new way in which the government estimates the population, which is used to calculate the unemployment rate. That prompted some economists to dismiss the drop in joblessness as a statistical quirk.

“The message is, you can’t believe what they tell you,” said Joshua Shapiro, chief United States economist at MFR Inc. in New York. “Everyone goes crazy over today’s number, but history has been rewritten. Things are not comparable from month to month.” [Odd that they would include what’s on everyone’s mind even though they are doing this solely to discredit the nay-sayers.]

Mr. Shapiro focused on the caution that still grips many households amid a time of economic anxiety, suggesting this will continue to dampen consumer spending, which accounts for more than two-thirds of the economy. That should keep employers reluctant to hire, limiting the wages that workers have to spend at other businesses. [Short answer good citizen is there will be no recovery, not now, not ever!]

“The question is, what is the rate of improvement going to be?” he asked. “Very slow. We don’t see companies going crazy on the hiring.”

Some forecasts envision the jobless rate reaching nearly 11 percent by the end of the year, which would raise the prospect of new shocks to the system: a retreat in consumer spending, and fresh fears in the banking system as jobless people lose the wherewithal to pay their mortgages, amplifying an already disturbing wave of foreclosures. [Again the ‘assumption’ is society will somehow be able to function with a terminally wounded taxbase.]

Such gloomy visions are at the center of concerns that the ending of the Great Recession could merely mark the beginning of a long period of disappointingly slow growth, or perhaps a pause before another downturn—one that could be difficult to escape. [Oooo, ‘Happy, Happy, Joy, Joy!’ is it just me or is there an inordinate amount of gloom hiding in this unabashed pronouncement of economic victory?]

“Businesses are still very cautious,” said Nigel Gault, an economist for IHS Global Insight.

Construction continued to suffer in January, shedding 75,000 net jobs. Transportation and warehousing lost 19,000 net jobs.

Small companies complain that loans remain exceedingly difficult to secure, limiting their ability to expand and hire. Businesses with fewer than 500 employees hold more than half of the nation’s private-sector jobs, according to the Small Business Administration.

In Cleveland, Kirk K. Meurer, the owner of store that sells office furniture, has frozen the pay of his 30 employees and stopped buying new cars in an effort to trim costs. He has a $250,000 loan, but complains that it has been difficult to persuade his bank to lend any more, limiting his contribution to spending in the local economy. [Bank is no fool. Who the hell is buying office furniture never mind leasing office space? That damn ‘For Lease’ corporation is taking over everything!]

“I’m being very frugal with my decisions,” Mr. Meurer said. “For us to hire, we need to see a turn in the economy.”

But many economists took the January jobs report as evidence that such a turn is indeed at hand. [Um isn’t the qualifier here ‘academic economists’? You know, the kind with no ‘real world’ experience? And if you’re talking about economists who work for investment firms, they are nothing better than ‘paid liars’ all they do is ‘talk their book’.]

For months, American business has been defined by what economists refer to as productivity growth: companies have expanded their output of goods and services without increasing their labor. [Which is total horseshit!] January’s data — particularly the [unspecified] increase in manufacturing and the hours worked — appeared to signal that employers finally feel enough confidence in the expanding business opportunities to add to payrolls. [Ahem, I say again, we have zero idea how ‘large’ this one time increase is…or isn’t. There isn’t a fucking single thing you can point to and say ‘this is driving the increase’…not a thing.]

Health care, long a bright spot in a largely dismal economy, added 17,000 net jobs in January. Retail jobs swelled by 42,000, though some economists suggested this could be reflective of the way the Labor Department adjusts for seasonal factors. Professional and business services added 44,000 jobs. [Um, didn’t Wal-Mart just announce 12,000 lay-offs? So what the fuck makes these assholes say ‘retail’ is adding workers when we have proof of the exact opposite?]

“We’ve seen a surge in demand for graphic designers and people who create display advertising for the Web,” said Fabio Rosati, chief executive of Elance, an online job market for freelance computer programmers and other tech-related workers. “There’s been an increase in confidence among employers over the last few months.” [What The Fuck! How does an uptick in hiring INDEPENDENT CONTRACTORS spell ‘increased confidence’? These aren’t even permanent jobs!]

Adding to the sense that employers are finally inclined to add labor as they expand production, the number of so-called involuntary part-time workers — people who cannot find full-time jobs, or whose hours have been cut — fell from 9.2 million to 8.3 million in January. [Left unsaid is how many of these workers were axed completely as opposed to being returned to full time employment?]

But even amid the welcome evidence of improvement, the report offered up another batch of evidence that times remain bitterly hard for millions of Americans, with a long slog through lean times likely ahead.

The so-called underemployment rate — which counts the involuntary part-timers along with people who have given up looking for work — sat at 16.5 percent in January. That amounted to an improvement from the 17.3 percent seen a month earlier, yet it was nearly double the level of three years ago. [I’m going to guess these buttheads (correctly) figure most people don’t read down this far, they read the headline and maybe the first couple of paragraphs and then they move on…]

Those who have been out of work for six months or longer swelled from 6.1 million in December to 6.3 million in January, the highest level since the government began tracking such data in 1948.

“Things are getting bad less rapidly,” said Dean Baker, co-director of the liberal Center for Economic and Policy Research in Washington. “We’re sort of hitting bottom, but there is no evidence of a robust turnaround.”

How about that last line good citizen? Actually the last couple of statements negate the whole damn article…this piece is nothing more than pabulum for the feeble-minded!

Recently the discussion turned around here turned to ‘Why bother’? My own posts have devolved into ‘same shit, different day’. This is probably the umpteenth post dissecting the fake recovery.

While much is the same, some parts are different. Tonight’s post displays the ‘desperation’ of the powers that be.

Failure is not an option. Things won’t stay glued together if they admit saving our scuttled economy is an exercise in futility.

It’s ‘even worse than it appears’. Once it becomes apparent that we have been toiling away on a ‘fool’s errand’, the collapse of ‘life as we have come to know it’ will be very rapid indeed.

And make no mistake about it, these lies they are spreading now WILL come back to bite them on the ass! Either the liars are ‘expendable’ or the probability that there will be enough survivors of the aftermath of whatever’s coming to worry about is considered to be negligible.

Either way good citizen, there is more to tonight’s offering than SSDD.

Thanks for letting me inside your head,

Gegner

Stray Animals...

Greetings good citizen,

The markets are off 200+ points and the trading day isn’t over yet. Word is this rout was caused by a ‘surprising’ under-performance in the job market. [Update: The market closed down 268 points! Um, you can ignore that exclamation point if you don’t care for it…]

Honestly good citizen, do you think even the liars who continue to insist the economy is recovering are actually ‘surprised’? Just because they pretend to be ignorant doesn’t make it so.

Of course, when one side of the ‘whip hand’ fails to deliver there is always the ‘fall back’ position.

As we see here in tonight’s offering [purloined from today’s Alternet]

Hightower: GOP Is the Party That Thinks Helping the Poor and Hungry Is Like Feeding 'Stray Animals'

Where else can raw ignorance rise to such high places -- and then flaunt itself shamelessly for all to see?

For example, who needs Jay Leno or Conan O'Brien for comic relief, when we've got Andre Bauer? He's the Lieutenant governor of South Carolina (a state, by the way, that really is a comer on the political comedy circuit — especially after Gov. Mark Sanford's madcap schtick last year involving his disappearance, the Appalachian Trail and an Argentine mistress.

But Sanford is leaving office, and Bauer, who is now a Republican contender for governor, is the state's new star joker. He had 'em rolling in the aisles recently when he did a wild, slapstick routine on food stamps at a town hall meeting. Andre proclaimed that much of his political thinking was shaped by his grandmother and that he had learned a valuable lesson from her.

"She told me as a small child to quit feeding stray animals. You know why?" he asked, pausing for comedic effect. "Because they breed! You're facilitating the problem if you give an animal or a person ample food supply. They will reproduce."

I tell you, Andre Bauer is an absolute scream!

But here's the real punch line: The need for food stamps has been soaring as more and more Americans are falling out of the middle class into poverty. From 2000 to 2008, 5 million more were added to the poverty rolls, and that was before the economic collapse of the last two years. In fact, check this out Andre, and laugh if you feel like it: About 6 million Americans today are living entirely on food stamps — they've lost their jobs and have no other income. That's one out of every 50 of us, and their numbers are growing rapidly.

Now, isn't that a hoot? [It is if you’re a true conservative!]

Well, one who's not laughing is Republican member of Congress John Linder. This far-out Georgia right-winger is irked that America's food stamp program will grow to more than $60 billion this year. "This is craziness," Linder barked to a New York Times reporter.
"We're at risk of creating an entire class, a subset of people, just comfortable getting by living off the government."

Comfortable? When was the last time this pampered lawmaker experienced the "comforts" of the food stamp life? Linder himself has been "living off the government" for 18 years, but at the high end — drawing $174,000 a year in pay, plus subsidized health care, a fat pension and generous perks of office. [But that’s ‘different’, you see, numbnuts knows the score. Ordinary people didn’t put him in office, the powerful gave him that seat.]

Hypocrisy aside, Linder is an anti-government, laissez-faire extremist who buys into Bauer's fantasies about lazy, good-for-nothing strays getting food stamps. [Because that’s what the real thieves want you, gullible conservatives, to think!]

"You don't improve the economy by paying people to sit around and not work," he grumps, adding, "You improve the economy by lowering taxes." [Gee, where has he been? We did that and it didn’t work out too well for anyone who wasn’t already rich!]

Really? Perhaps the gentleman from Georgia has forgotten that he and the whole Washington insider crowd tried that scam again and again throughout the past decade, slashing all sorts of taxes for corporations and the wealthy. Since Linder is a multimillionaire, that economic "plan" undoubtedly worked out splendidly for him.

For the middle class, however, the 10 years since January 2000 are known as "the lost decade." In that period, the U.S. economy lost more jobs than it created — zero job growth. That's the first decade since the end of the Depression that our country has had less than a 20 percent rise in job creation. [You don’t suppose globalization had anything to do with that, do you?]

Also, after the 10-year frenzy of tax-cutting, middle-class families are earning less today, in real dollars, than they did in 1999. Add in skyrocketing health care costs and the plummeting value of people's homes, and we get the harsh reality of mushrooming poverty.

So that "subset of people" on food stamps whom Linder so callously denigrates are his own spawn! The food stamp program has had to grow because the tinkle-down economy that he pushed has wrecked America's middle class.

Does knocking poor people make these guys feel better about themselves? How pathetic. Bauer and Linder are living proof that when it comes to leadership, America has too many 5-watt bulbs screwed into 150-watt sockets.

COPYRIGHT 2010 CREATORS.COM

Jim Hightower is a national radio commentator, writer, public speaker, and author of the new book, "Swim Against the Current: Even a Dead Fish Can Go With the Flow." (Wiley, March 2008) He publishes the monthly "Hightower Lowdown," co-edited by Phillip Frazer.

Had to steal this particular post if only because it demonstrates just how dire our collective position has become.

Those who continue to exploit you for the sweat of your brow expect you to hock your future to keep them in the lap of luxury…after they have abandoned you to fend for yourself as best you can!

How can these ignorant ingrates off-shore all of their workers then ask where all of their customers went? We can’t afford to have people THAT STUPID making decisions which effect the well-being of society as a whole!

So we return to capitalism’s ‘hero’, Forrest Gump and ‘stupid is as stupid does’

Unexpected Rise in U.S. Jobless Claims [Really now?]

By THE ASSOCIATED PRESS
Published: February 4, 2010

WASHINGTON (AP) — The number of newly laid-off workers filing initial claims for jobless benefits rose unexpectedly last week, the Labor Department said Thursday.

And a second report by the Labor Department showed that people with jobs worked harder in the fourth quarter.

Pretty typical, beat the bag out of the ‘survivors’ (in fact, being ‘susceptible’ to this kind of ‘blackmail’ is a determining factor come ‘lay-off time’.) No need to hire more workers, in fact it’s cheaper to pay the survivors overtime than it is to shell out for benefits for new hires.

Which means demand has to pick a whole shit load if we’re going to see any hiring (beyond temps) at all.

Which is to ask if you see the light at the end of this tunnel that the pundits keep talking about but nobody can point too…besides the foolish stock market?

Speaking of which, markets around the world closed down today…so where is this recovery the sellers of stocks keep pretending exists?

Maybe we just need to look a little harder…

Until then…thanks for letting me inside your head,

Gegner

If it Quacks like a Duck

Greetings good citizen,

What do you suppose the consequences are for ‘bad information’? For the people dishing out the unreliable data, they lose credibility (first) but, if the bad information caused people to endanger themselves, the consequences could be quite extreme indeed.

Let’s suppose we take the middle ground and suppose the bad information only enabled the people who sign the information passer’s paychecks to make a fortune at everyone else’s expense…how dangerous would that be?

Not particularly, not at first anyway. Stock prices run ahead of an economic recovery and sometimes they even front run recovery’s that fail to materialize (sort of a ‘investors recovery’ if you know what I’m saying.) Now, who gets hurt by an innocent thing like that?

No one right? Well, let’s not be too hasty here…if the stocks are up, so are the prices commanded for the goods those stocks represent! So you’re making less and paying more…all because some conniving weasels are lying through their teeth about the true state of the economy.

Now the lie isn’t so innocent, is it? What do you suppose the effects are of the market gaining four thousand points while the economy remains stagnant?

No harm, no foul right; heck, the people who saw their 401k’s almost get wiped out made some of what they lost back! Everybody ‘won’, didn’t they?

No so quick again Slick! How about yesterday’s story about Blackrock filing 1,800 notices that they now own more than 5% of 1,800 NYSE listed firms? How do you suppose a publicly traded venture capital firm was able to afford that much stock?

Or to ask a more succinct question, what bank(s), in their right mind, lent Blackrock that kind of money? And since we aren’t talking tiddley-winks here, where did our freshly bailed out banks get their hands on that kind of money?

Banks snapping up stocks with public funds during an economic downturn…it blows your mind! These stocks are only worth a fraction of what Blackrock paid for them, what the fuck were they thinking?

I guess we’ll never find out because nobody in the government has the gonads to go after the people in the banking sector who are hijacking public funds.

Naturally, all of this is ‘crazy talk’…nobody would waste public funds never mind jeopardize our entire financial system (this is bad enough to ‘de-stabilize’ the dollar)…

That’s what everybody thought when Hitler threatened to invade Czechoslovakia.

No one believed Hitler would actually follow through and we have the same situation here, nobody actually believes that bankers would be reckless enough to destroy the world’s financial system, just to cover up their theft! (We aren’t talking small potatoes there either, a quadrillion dollars worth of credit default swaps!)

Can I prove it? Of course I can’t (although I think the Blackrock ‘revelation’ is more than a little damning…) Worse, we’ve been lied to so often it is almost impossible to tell fact from fiction, especially if it comes out of either Wall Street or Pennsylvania Ave.

So we arrive at tonight’s offering for another dissenting opinion on the ‘economic recovery’…

Rosenberg: Without The Consumer And Households, The Recovery Is Toast

In today's note, David Rosenberg gets at the real reason there's no economic rebound:

A RECOVERY WITHOUT THE CONSUMER AND HOUSING?

Hey — these two sectors combined account for only 75% of the economy. Who
needs ‘em? Below is the three-month moving average of the Chicago Fed’s
National Activity Index (CFNAI) — the personal consumption and housing sub-index
to be exact. [Click the link, then:] Look at Chart 1 and please tell us if it depicts an economy in recovery mode. This sub-index is still mired deep in recession terrain, with all deference to the latest set of GDP data. The other three components — sales, production, and employment to a lesser extent — have done virtually ALL of the heavy lifting to get us to where we are overall on the CFNAI, which is an economy barely going at all. [Did they omit the ‘R’ and the ‘W’ from ‘going’ on purpose?]

Absent a turn in this sub-component, the other three cannot carry us much further.
The bottom line is that if the personal consumption & housing sub-component
doesn’t start showing some signs of life, it’s game over as far as the recovery
story goes. Exiting recessions, this sub-component sits, on average, at -0.09. It
printed at -0.48 last Thursday, and has not printed better than -0.43 since
December 2008. In other words, it is going nowhere fast, and the other
components can’t carry the ball forever.

Not that Dumb and Dumber wouldn’t have you think otherwise! In fact, I’m a little surprised we have already heard something along the lines of, ‘Who needs the consumer and dumb old housing anyway? Look at the stock market, the economy is doing fine!’

It’s like the morons who say “So what if unemployment is at ten percent; that means ninety percent of people are still working!”

Like unemployment encompasses all working aged citizens!

Sadly this is not the case. The ‘employed’ workforce is roughly 130 million (same as it was twenty years ago), the number of working aged citizens is roughly double that…so we’re actually staring a an unemployment rate that is close to fifty percent!

Let’s make it worse…out of those 130 million, over 40% of them are NOT employed full time! As off-shoring has made more people ‘redundant’, part-time work is often as good as it gets.

Where’s your ‘90%’ now, huh Chuckie?* (*short for ‘chucklehead’…)

If you know what you’re looking at the statistics are mighty grim and you can only wonder what the hell is going on between the ears of our self-professed ‘betters’.

Take a good look around you good citizen and you will find ample proof that money doesn’t equal brains…

Thanks for letting me inside your head,

Gegner

Growth isn't Possible...

Greetings good citizen,

Once again we are going to poke around in that dusty attic of yours to see what kind of nonsense has been deposited up there.

Anyone who has been paying attention knows the Fed/Government has been trying to ‘re-inflate’ the economy in an attempt to ‘re-start’ the engine. Sadly, what passed for the engine of our (the world’s) economy seized solid once the value of credit default swaps exceeded that of all the money there ever was. (Making it apparent that most of these securities weren’t worth the paper they were written on…)

Anyway, the point being is that the powers that be are working under the insane ‘assumption’ that if they can get the economy ‘growing’ again, everything will work itself out.

This naturally brings us full circle to the unfortunate fact that nature is incapable of expanding eternally. We only have so much planet to work with here and we have yet to unlock the secret of ‘transfiguration’ or the ability to turn whatever’s on hand into whatever is needed at the moment.

Of course, by the time we master that talent we will have access to all of the planets we can use. Until then it would be wise to learn how to live within our means.

Unfortunately, economists don’t think this way. The universe (or the planet for that matter) failing expand ‘on demand’ is dismissed as ‘meaningless.’ It is always ‘assumed’ that it will do what is required of it.

And you know what happens when you ‘assume’, don’t you? You make an ass out of ‘u’ and ‘me’…

So we proceed with tonight’s offering

Published Jan 25 2010 by New Economics Foundation, Archived Jan 26 2010

Growth Isn’t Possible (report excerpt)
by Andrew Simms, Victoria Johnson and Peter Chowla

From the nef website:

As economist Herman Daly once commented, he would accept the possibility of infinite growth in the economy on the day that one of his economist colleagues could demonstrate that Earth itself could grow at a commensurate rate.

Whether or not the stumbling international negotiations on climate change improve, our findings make clear that much more will be needed than simply more ambitious reductions in greenhouse gas emissions. This report concludes that a new macro economic model is needed, one that allows the human population as a whole to thrive without having to relying on ultimately impossible, endless increases in consumption. [Like it or not good citizen, that is the current model we are left to work with. Why does it ‘always’ have to expand? That’s the only way it can generate ‘profits’. Bizarrely, if there is no profit, then there is no point…]

From the Introduction:

...In January 2006, nef (the new economics foundation) published the report Growth isn’t working.9 It highlighted a flaw at the heart of the economic strategy that relies overwhelmingly upon economic growth to reduce poverty. The distribution of costs and benefits from global economic growth, it demonstrated, are highly unbalanced. The share of benefits reaching those on the lowest incomes was shrinking. In this system, paradoxically, in order to generate ever smaller benefits for the poorest, it requires those who are already rich and ‘over-consuming’ to consume ever more. [Gee, guess who is ‘falling down on the job!’.]

The unavoidable result, the report points out, is that, with business as usual in the global economy, long before any general and meaningful reduction in poverty has been won, the very life-support systems we all rely on are likely to have been fundamentally compromised.

Four years on from Growth isn’t working, Growth isn’t possible goes one step further and tests that thesis in detail in the context of climate change and energy. It argues that indefinite global economic growth is unsustainable. Just as the laws of thermodynamics constrain the maximum efficiency of a heat engine, economic growth is constrained by the finite nature of our planet’s natural resources (biocapacity). As Daly once commented, he would accept the possibility of infinite growth in the economy on the day that one of his economist colleagues could demonstrate that Earth itself could grow at a commensurate rate.

The most recent data on human use of biocapacity sends a number of unfortunate signals for believers in the possibility of unrestrained growth. Our global ecological footprint is growing, further overshooting what the biosphere can provide and absorb, and in the process, like two trains heading in opposite directions, we appear to be actually shrinking the available biocapacity on which we depend. [Big surprise, huh?]

Globally we are consuming nature’s services – using resources and creating carbon emissions – 44 per cent faster than nature can regenerate and reabsorb what we consume and the waste we produce. In other words, it takes the Earth almost 18 months to produce the ecological services that humanity uses in one year. The UK’s footprint has grown such that if the whole world wished to consume at the same rate it would require 3.4 planets like Earth. [Okay, the whole planet can’t consume the way Western civilizations do…but I’ll tell you right now the West is not going to quietly stand aside and let the ‘developing world’ have their turn…that isn’t going to happen.]

Growth forever, as conventionally defined (see Box 1), within fixed, though flexible, limits isn’t possible. Sooner or later we will hit the biosphere’s buffers. This happens for one of two reasons. Either a natural resource becomes over-exploited to the point of exhaustion, or because more waste is dumped into an ecosystem than can be safely absorbed, leading to dysfunction or collapse. Science now seems to be telling us that both are happening, and sooner, rather than later.

Yet, for decades, it has been a heresy punishable by career suicide for economists (or politicians) to question orthodox economic growth. As the British MP Colin Challen quipped in 2006, ‘We are imprisoned by our political Hippocratic oath: we will deliver unto the electorate more goodies than anyone else.’12

...Why do economies grow?

We should ask the simple question, why do economies grow? And, why do people worry that it will be a disaster if they stop? The answers can be put reasonably simply.

For most countries in much of human history, having more stuff has given human beings more comfortable lives. Also, as populations have grown, so have the economies that housed, fed, clothed and kept them.

Yet, there has long been an understanding in the quiet corners of economics, as well as louder protests in other disciplines, that growth cannot and need not continue indefinitely. As John Stuart Mill put it in 1848, ‘the increase of wealth is not boundless: that at the end of what they term the progressive state lies the stationary state.’20

The reasons for growth not being ‘boundless’ too, have been long known. Even if the modern reader has to make allowances for the time in which Mill wrote, his meaning remains clear: ‘It is only in the backward countries of the world that increased production is still an important object: in those most advanced, what is economically needed is a better distribution.’21

...Why growth isn’t working

Between 1990 and 2001, for every $100 worth of growth in the world’s income per person, just $0.60, down from $2.20 the previous decade, found its target and contributed to reducing poverty below the $1-a-day line.38 A single dollar of poverty reduction took $166 of additional global production and consumption, with all its associated environmental impacts. It created the paradox that ever smaller amounts of poverty reduction amongst the poorest people of the world required ever larger amounts of conspicuous consumption by the rich. [Stop! What’s wrong with this picture? If the rich can’t spend fast enough is that it, is that all that can be done? Not by a long shot! The impoverished circumstances can be a relieved directly!]

Growth wasn’t (and still isn’t) working.41 Yet, so deeply engrained is the commitment to growth, that to question it is treated as a challenge to the whole exercise of economics. Nothing could be further from the truth. This report is a companion volume to nef’s earlier and ongoing research. It is written in the hope that we can begin to look at the fascinating opportunities for economics that lie beyond the doctrine –it could be called dogma – of growth.

One of the few modern economists to have imagined such possibilities in any depth is Herman Daly. 42 The kind of approach called for in a world constrained by fuzzy but fundamental limits to its biocapacity is one, according to Daly, that is: ‘a subtle and complex economics of maintenance, qualitative improvements, sharing frugality, and adaptation to natural limits. It is an economics of better, not bigger’. 43 [snip…it gets a little ‘geeky’ for a while so I cut it out.]

Peak Oil

Although increasingly warning of production capacity constraints, the IEA makes no detailed mention of the possible physical limits to continuing exploitation of fossil fuels to drive the global economy.

That is, with the single exception in one media interview, when Fatih Birol, the IEA’s chief economist, said, ‘In terms of the global picture, assuming that OPEC will invest in a timely manner, global conventional oil can still continue, but we still expect that it will come around 2020 to a plateau.’ 207 In other words, a peak and long-term decline in the global production of oil. Evidence is presented later in this report on the likely onset of Peak Oil.

Projections for oil and gas production were obtained from Colin Campbell and the Association for the Study of Peak Oil (ASPO).208 Given the constraints in building and developing alternative sources of energy, such as nuclear or hydroelectric power stations, we have assumed that the energy requirements left unfilled because of the shortage of oil and gas will be filled by replacing those fuels with coal – a phenomenon that appears to be occurring already. This has significant effects on the carbon intensity of energy. While the rate of supply side efficiency improvements to the energy intensity of the economy are also dependent on the fuel mix, this substitution serves as a first order estimate of the effects of Peak Oil on anthropogenic greenhouse gas emissions. [Thus it could explain the massive indifference to social considerations as the economy ‘shrinks’ to fit ‘the new normal’.]

As CCS is still an immature technology, yet to be proven at scale, we do not assume that it plays a role in reducing the carbon intensity of the economy.210 The future role of CCS is discussed in more detail later in this report. [One could assume ‘CCS’ refers to Clean Coal]

We have also erred on the side of caution by not factoring in the declining net energy gains from fossil fuel extraction as more marginal stocks of oil, gas and coal are exploited. Increasing amounts of energy must be used to exploit heavy oils and tar sands which would have deleterious effects on the energy intensity ratio. 211 But without a very comprehensive and detailed global energy model, predicting such effects would be difficult. Additionally, using coal that is higher in moisture or otherwise less efficient for electricity production would have similar negative effects on the energy intensity ratio that we have not modeled here for lack of data.

Results

As shown in Figure 6, the scenarios developed by the IEA would lead to extremely high concentrations of atmospheric CO2, with the RS breaching the upper limit of our most generous target range in 2047. Even the optimistic AP scenario, would lead to atmospheric concentrations of CO2 of 487 ppm by 2050. [Unless the number of ‘end users’ is radically reduced…not by millions but by billions.]

The results of a possible emissions scenario that would seek to stabilize atmospheric CO2 concentration at 500 ppm after 2050 is shown in Figure 7. Given the pre-2050 emissions pathway of the alternative policy scenario, it is impossible to prevent an overshoot of the target. The changes in emissions levels needed to even bring about stabilization after an overshoot are quite dramatic. As Figure 7 shows, if the alternative policy scenario is followed until 2050, immediately thereafter carbon emissions would still have to be curtailed by roughly 1.1 per cent annually to even stabilize atmospheric CO2 below 550 ppm. This does not account for the impact of carbon-cycle feed backs, however.

If we take into account the effects of carbon-cycle feedback mechanisms, the atmospheric concentrations of CO2 corresponding to a given level of emissions increases over time. As climate models disagree about the magnitude of the feedback effect, we have demonstrated the range of possible CO2 concentrations in Figure 8. Data on the potential carbon-cycle feed backs were take from the C4MIP Model Intercomparison.212 In the worst-case scenario, the atmospheric concentration of CO2 is about 10 per cent larger than previously modeled.

The situation becomes much worse when the Peak Oil projections are combined with the possible efficiency improvements described in the IEA scenarios (see Figure 9). In the AP scenario, resulting emissions from the projected change in the fuel mix would be nearly 17 per cent higher than the IEA projections. This would bring projected atmospheric CO2 concentration to 501 ppm in 2050. Peak Oil, therefore implies that proceeding with every proposed improvement to energy intensity and adoption of cleaner fuels will not be sufficient to prevent a breach of even the most generous target and thus potentially disastrous climate change.

From Chapter 3: Peak Oil, Gas

Supplying the world with all the crude oil and natural gas it wants is about to become much harder, if not impossible. For oil, the horizon of the global peak and decline of production appears close and that for gas not much further behind. When demand exceeds production rates, the rivalry for what remains is likely to result in dramatic economic and geopolitical events that could make the financial chaos of 2008 in Europe and the USA seem light-hearted. Ultimately, it may become impossible for even a single major nation to sustain an industrial model as we have known it during the twentieth century.220 [Again the chilling subtext here is a sustainable model MAY be possible if enough ‘end users’ are, er, ‘neutralized’.]

Counter-intuitively, the imminent global onset globally of the peak, plateau and decline of the key fossil fuels, oil and gas, will not help arrest climate change. If anything, it could be a catalyst for worse emissions and accelerating warming. For example, in October 2009, the UK Energy Research Centre (UKERC) reviewed the current state of knowledge on oil depletion.221 The study argued as we advance through peak oil: there will be strong incentives to exploit high carbon non-conventional fuels. Converting one third of the world’s proved coal reserves into liquid fuels would result in emissions of more than 800 million tonnes of CO2, with less than half of these emissions being potentially avoidable through carbon capture and storage.

In other words, with the analyses by Meinshausen and Allen discussed earlier in this report in mind, without extensive investment in low carbon alternatives to conventional oil, and policies that encourage demand reduction, Peak Oil is likely to drive emissions further towards a threshold of dangerous climate change. [Left unsaid is this will be the least of our problems…]

Peak Oil and food production

Increased fossil energy prices will in turn cause the price of food to increase significantly. On average, 2.2 kilocalories of fossil fuel energy are needed to extract 1 kilocalorie of plant-based food.222 In the case of meat, the average amount of kcal fossil energy used per kcal of meat is much greater, with an input/output ratio of 25.223 [The footnotes make these passages difficult to navigate…]

In early 2008, the UN World Food Program had to reassess its agreed budget for the year after identifying a $500 million shortfall. It found that the $2.1 billion originally allocated to food aid for 73 million people in 78 countries would prove to be inadequate because of the rising costs of food. Higher oil and gas prices have contributed to this by increasing the costs of using farm vehicles and machinery, transporting food and manufacturing fossil-fuel-dependent input such as fertilizer. The move to grow biofuel crops has also exerted upward pressure on food prices by leaving less productive land available to grow crops.

The global economy is still well over 80 per cent dependent on fossil fuels. Oil remains the world’s most important fuel largely because of its role in transport and agriculture and the ease with which it can be moved around. The historical pattern has been for industrial societies to move from low-quality fuels (coal contains around 14–32.5MJ per kg) to higher quality fuels. 41.9 MJ/kg for oil and 53.6 MJ per kg and from a solid fuel easily transported and therefore well-suited to a system of global trade in energy resources. 224

Almost all aspects of our economy are dependent on a constant and growing supply of cheap oil, from transport to farming, to manufacturing and trade. In the majority world, where too many people live close to, or below the breadline, the long tail of green revolution agriculture depends on pesticides and fertilizers that need large amounts of fossil fuels. The implication of any interruption to that supply, either in terms of price or simple availability, means a significant shock to the global economy. Everyone will be affected, but some more than others.

From the last chapter: If not the economics of global growth, then what? Getting an economy the right size for the planet

The stationary state

The lineage of the notion of ‘one planet living’ can be traced at least as far back as the early nineteenth century. Philosopher and political economist John Stuart Mill was shaped by the human and environmental havoc of the voracious Industrial Revolution.

In reaction to it, he argued that, once certain conditions had been met, the economy should aspire to exist in a ‘stationary state’. It was a hugely radical notion for the time. Mill thought that an intelligent application of technology, family planning, equal rights, and a dynamic combination of a progressive workers movement with the growth of consumer cooperatives could tame the worst excesses of capitalism and liberate society from the motivation of conspicuous consumption. [Can you see his ‘mis-calculation’?]

He prefigured Kropotkin’s analysis that economics could learn from the success of cooperation, or ‘mutual aid’ as he coined it, in ecological systems, itself a riposte to the fashionable misappropriation of Darwinism to social and economic problems.406 The latter economic folk wisdom remains nevertheless strong. And even today, the Anglo Saxon economic model is commonly defended with similar misappropriations of Darwin that emphasise the ‘law of the jungle’ and ‘survival of the fittest.’ This view suggests that competition in economics, as in nature, should be the natural, dominant mode of operation. Yet, actual evolutionary biology has moved far beyond this caricature, identifying a wide range of different and equally successful strategies in evolution alongside competition.407

These include symbiosis (an example of which is the bacteria which fix nitrogen in plant roots consequently making life possible), collaboration (as was the case with primeval slime mould), co-evolution (the pollinating honey bee responsible for about one in three mouthfuls of the food we eat), and even reason (as with problem solving animals – like elephants, dogs, cats, rats, sperm whales and, sometimes, humans). Optimal diversity too is considered a key condition – nature’s insurance policy against disaster – suggesting that economic systems which allow clone towns to be dominated by massive global chain stores, are probably a bad idea.

Mill also prefigured Keynes’s hope, and similar faith in technology, that once the ‘economic problem’ was solved, we would all be able to turn to more satisfying pursuits, and put our feet up more. He also prepared the ground for the emergence of ecological economics.

The Steady state

In a fairly direct line of intellectual descent, economist Herman Daly has done perhaps more than anyone to popularize the notion of what he calls ‘steady state’ economics. His comprehensive critique, worked-up over decades, decries the absence of any notion of optimal scale in macro-economics. And the persistent, more general refusal of the economics profession to accept that it, too, like the rest of life on the planet, is bound by the laws of physics (see Introduction).

As he wrote in Beyond Growth: ‘Since the earth itself is developing without growing, it follows that a subsystem of the earth (the economy) must eventually conform to the same behavioral mode of development without growth.’ 408

Of course the big question concerns when, precisely, the ‘eventually’ moment comes. Daly borrows a public safety analogy from the shipping industry to demonstrate what is needed ecologically at the planetary level.

The introduction of the ‘Plimsoll line’ was, so to speak, a watershed to do with a watermark. When a boat is too full, rather obviously it is more likely to sink. The problem used to be that, without any clear warning that a safe maximum carrying capacity had been reached, there was always an economic incentive to err on the incautious side by overfilling. The Plimsoll line solved the problem with elegant simplicity: a mark painted on the outside of the hull that indicates a maximum load once level with the water.

Daly’s challenge to economics is to adopt or design an equivalent, ‘To keep the weight, the absolute scale, of the economy from sinking our biospheric ark’.409 But Daly is not a crude environmental determinist; for any model to work he insists that alongside optimal scale, equally important is a mechanism for optimal distribution based on equity and sufficiency.

To date, the nearest, in fact, only, leading contender to provide the environmental Plimsoll line is the Ecological Footprint. Before the Contraction and Convergence model, which is designed to manage safely greenhouse gas emissions, was ever thought of, Daly identified its basic mechanism as the way to manage the global environmental commons. First, he said, you need to identify the limit of whichever aspect of our natural resources and biocapacity concerns you, then within that, allocate equitable entitlements and, in order to allow flexibility, make them tradable. Such an approach could be applied to the management of the world’s forests and oceans as much as CO2. Daly credits the innovative American architect and polymath Richard Buckminster Fuller for first suggesting the approach. At a fundamental level, this is the primary mechanism to avoid the tragedy of the commons. [Has anyone else spotted the ‘flaw’ in this idea? It’s the same flaw market suffer from and it’s based on an ‘assumption’.]

In addition, an indicator such as the Happy Planet Index410 which incorporates the Ecological Footprint helps to reveal the degree of efficiency with which precious natural resources are converted into the meaningful human outcomes of long and happy lives. [We’ve seen the flaws with this mechanism exploited to advance inequality too.]

At the ‘eventually’ moment, or rather well before, these other ways of organizing and measuring the economy become vital. In one sense it has already passed. According to the Ecological Footprint, the world has been over-burdening its biocapacity – consuming too many natural resources and producing more waste than can be safely absorbed – since the mid-1980s. We’ve been living beyond our ecological means. But, at what point does the damage become irreversible? This will be different for different ecosystems. But, where climate change is concerned, we have drawn a line in the atmospheric sand at the end of 2016. Based on current trends and several conservative assumptions, at that point, greenhouse gas concentrations will begin to push a new, more perilous phase of global warming. 411 [Um, considering the ‘alternative’, warming isn’t such a bad thing…if we were to reverse course and enter another ice age, we’d be well and truly…]

Dynamic equilibrium

‘Stationary’, ‘steady’, up to a point these words communicate the message that, logically, a subset of a system (the economy) cannot outgrow the system itself (the planet), and the need exists to establish a balance. Why suggest yet another term for an essential characteristic of true sustainability?

Yet, the terms ‘stationary’, and ‘steady’, are unattractive for our purposes. They fail to capture sufficiently the dynamism of the interactions between human society, the economy and the biosphere. They wrongly appear to suggest for economics, what was once famously, and with epic error announced for history, namely its end. [Yeah, as far as economists are concerned a ‘static’ economy is a dead economy but that’s due to having the wrong ‘incentives’ in place.]

But, on the contrary, writes Daly, it is just that a very different economics is needed, one that is; ‘a subtle and complex economics of maintenance, qualitative improvements, sharing frugality, and adaptation to natural limits, It is an economics of better, not bigger’.412

‘Dynamic equilibrium’, is both a more accurate description of the condition we have to find and manage, and a more attractive term. Found typically in discussions of population biology and forest ecology, it captures a mirror of nature for society, in which, within ecosystem limits, there is constant change, shifting balances and, evolution. ‘Dynamic’ in the sense that little is steady or stationary, but ‘equilibrium’ in that the vibrant, chaotic kerfuffle of life, economics and society must organize its affairs within the parent-company boundaries of available biocapacity.

In his parting address from the World Bank, where he worked for six years, Daly left his colleagues with a formula for sustainability: stop counting the consumption of natural capital as income. Tax labor and income less, and resource extraction more; maximize the productivity of natural capital in the short run and invest in increasing its supply in the long run; and most contentiously, abandon the ideology of global economic integration through free trade, free capital mobility, and export-led growth. [All three lead to disaster!]

nef’s report, The Great Transition, explores how best to organize an economy that exists in a state of dynamic equilibrium with the biosphere. That and other research underway seeks to address all the usual questions such as ensuring livelihoods, security in youth and old age, maximizing well-being and social justice. The point of this report has been simply to establish the case, as far as possible beyond question, that such an economy is needed.

The challenge: How to create good lives and flourishing societies that do not rely on infinite orthodox growth

This report set out to examine the physical and environmental constraints to unlimited global economic growth as measured by GDP. Taking climate change and fossil fuel use as a particular focus, we find that these constraints at the global level are real and immediate. This means, that in order to allow economic growth in low per capita income countries where, for example, rising income has a strong relationship to greater life expectancy. There will need to be less growth in those high-income countries where the relationship to increasing life expectancy and satisfaction has already broken down.

From the sublime to the ridiculous, Why would Blackrock buy up a 5% interest in 1,800 NYSE listed firms?

Follow the link to learn more

An overly long post full of ‘techno-babble’, not necessarily as ‘entertaining’ as we could hope but certainly ‘food for thought’.

I’ll detain you no longer good citizen,

Thanks for letting me inside your head,

Gegner

Sky High!

Greetings good citizen,

Fearless Leader has once again come under attack by members of the ‘Party of Ideas’. No one knows why ‘Ideas’ is pluralized (because they only have one idea; that tax cuts can solve everything and anything.) Which leads us to a particularly disturbing conclusion…how the hell can you support the most advanced military on the planet if you are unwilling to pay for it?

It’s hard to find somebody more ‘patriotic’ than your flag-waving conservative, but somehow their loud and proud refusal to contribute to the defense of our nation doesn’t subtract from their patriotic fervor, or zeal for that matter.

Here we ride the ‘knife’s edge’ of the conundrum, how can conservatives be considered Right Wing, ‘Strong on Defense’, Hawks while refusing to fund the very flag they use to wrap themselves in?

Perhaps we’re asking the wrong question here. What we should be asking is how wonderful is it to own the press? With the press in you pocket, you can fuck up by the numbers and still proclaim yourself the ‘champions’.

You can fool some of the people some of the time but after a while the majority starts to get wise.

So we arrive at tonight’s offering

Obama’s 2010 Budget: Deficit Soars Amid Job Spending

By REUTERS
Published: February 1, 2010

Filed at 1:01 p.m. ET

WASHINGTON (Reuters) - Risking public anxiety over spending, U.S. President Barack Obama on Monday projected the budget deficit at a fresh record in 2010 as he battles double-digit unemployment before tightening finances in later years.

Criticized by Republicans as a tax-and-spend liberal, Obama is under pressure to convince investors like China he has a credible plan to control the U.S. deficit and debt over time.

"We won't be able to bring down this deficit overnight, given that the recovery is still taking hold," Obama said after laying out $3.8 trillion (2.38 trillion pounds) in spending plans for the fiscal year to September 30, 2011.

"We will continue, for example, to do what it takes to create jobs. That is reflected in my budget. It is essential," he said in a televised statement from the White House. [Um ‘bribing’ small businesses to hire workers they don’t necessarily need isn’t going to ‘solve’ anything. Worse, if the tax incentive is too small cash-strapped companies won’t hire. If it’s too big the, er, ‘temptation’ to cheat (churn their labor pool, just because they can) will only enrich employers while creating zero ‘new’ jobs.]

His blueprint now goes to a Congress deeply split on how to handle the twin woes of a massive deficit and high unemployment amid a still fragile emergence from recession. And lawmakers getting to work on the annual budget battle will be in no mood to anger voters ahead of congressional elections in November. [That’s it, beat them with a ballot box that nobody trusts and the media controls…]

The budget forecast a $1.56 trillion deficit in 2010, or 10.6 percent of the economy measured by gross domestic product (GDP). This funding gap is up from a 9.9 percent share of GDP in 2009. But the shortfall was forecast to shrink to 8.3 percent of GDP in 2011, and to have halved from the level Obama inherited when he took office when his terms ends in January 2013, keeping a key pledge. [There’s some ‘mighty optimistic’ arithmetic at work here considering how much of our economy slide beneath the waves, never to be seen again in 2008.]

The deficit's rise in 2010 was partly due to the $787 billion stimulus package Obama pushed through Congress soon after taking office last year to fight the recession. Obama, a Democrat, pinned the financial mess firmly on his Republican predecessor President George W. Bush. [Ironically the only people who don’t believe the republicans are responsible for this financial disaster are conservative ‘gasbags’ that are always blaming everybody but themselves for the messes they make.]

REPUBLICAN IRE

But Republicans seized on the grim fiscal forecast to criticise Obama's handling of the economy.[How will cutting taxes return our economy to prosperity…no one knows and only conservatives believe. Even the Great Gasbag himself can’t explain how making the already rich, richer is supposed to ‘save’ the economy.]

Senator Judd Gregg, the top Republican on the Senate Budget Committee, warned the country was sinking into a "quagmire" of debt and said Obama's stimulus plan had failed to create jobs. [This is the same ass-hat that was set to (and ultimately did) refuse a cabinet post if the Democratic governor of New Hampshire didn’t appoint another Republican to take his place…which raises the question of just who Judd Gregg serves, the people of New Hampshire or the Republican Party?]

"These circumstances call for a bold, game-changing budget that will turn things around, put in place a plan to restrain spending, reduce the debt and tackle the big entitlement programs that are growing out-of-control," he said. "Instead, the president has sent us more of the same." [If the ‘entitlement programs’ that are ‘growing out of control’ weren’t consistently being robbed by the Republicans to fund their wars of choice then Medicare and Social Security would be ‘fully funded’.]

While maintaining policies this year aimed at protecting a still fragile economic recovery, with $100 billion earmarked for measures to create jobs, Obama plans to save money from 2011 by curbing 120 projects, including a powerfully symbolic space mission to return to the moon, but will invest more in education and research. [We’ve been to the Moon, there’s nothing there. Worse…Bush decided we needed to return once China started its own ‘space program’.]

Market reaction was muted and analysts surveyed the numbers with a healthy dose of scepticism. [Um, bizarrely, the markets finished in positive territory today, which must also be ‘skepticism’.]

"I don't think there is anything out there that is job creating and I don't have much confidence that some of the spending cuts will actually happen," said Peter Boockvar, an equity strategist at Miller Tabak & Co. in New York. [Here’s a guy who knows what he’s talking about, and he’s right…a lot of these ‘spending cuts’ won’t happen…probably because they failed to ‘adjust for inflation’.]

Although Obama submits the budget to Congress, actual decisions about how the government raises and spends money are made on Capitol Hill in a process that usually lasts most of the year. [Isn’t ‘Standard Operating Procedure’ to dick around until the last possible moment then rush like mad at the last minute to ram through a budget so larded with pork your cholesterol jumps 50 points if you look at it for more than twenty seconds.]

Polls show voters are worried by the weak condition of U.S. finances, and Obama plans to create a bipartisan fiscal commission to figure out options on taxes and spending. [Um, nobody is ‘worried’ about the nation’s finances, not after we’ve spent 26 Trillion with a ‘T’ to glue our financial system back together…if that bad boy is broken, ‘We the People’ are going to tear Wall Street apart brick by brick!]

Much of the improvement in the fiscal picture is driven by underlying forecasts adopted in the budget for solid economic growth, yielding higher tax revenue. [Okay, how many of you think we’re in trouble now?]

The economy is forecast to expand by 2.7 percent in 2010, but then pull at an above-average 3.8 percent in 2011 and rise above 4 percent for the following 3 years. [Geez, you can’t help but wonder how much of that is ‘Renewable Energy’? See last night’s post.]

The budget also assumes unemployment will remain high, edging to 8.2 percent in 2012 from 10 percent this year, while inflation stays mild and interest rates rise only slightly.[ What is this? Can you say ‘The ‘New Normal’? If I’m reading this correctly they are expecting a lot fewer people to be spending a lot more money than they have in the past…if this is in any way inflation related we can kiss ‘social stability’ good-bye!]

POLITICAL PAIN

Discontent over the jobless rate translated into political defeat for Obama's Democrats in an election last month for the U.S. Senate in Massachusetts, costing the Democrats a crucial Senate seat and foreshadowing potentially big losses for the party in the November congressional elections. [This would be true if the Republicans weren’t responsible for the crisis in the first place. So who the hell are you going to vote for, more ‘whacko’ republicans who are likely to start something nobody can get us out of the next time or ‘do nothing’ spineless Democrats that are really just corporate lapdogs? Some choice, eh?]

The budget plan reflects a struggle to bolster the economy and create jobs while tightening the government's belt to reduce the deficit. Those issues are concerns of voters who will elect all 435 members in the House of Representatives and more than a third of the 100 Senate members in November.

To boost jobs, Obama is setting aside $100 billion in 2010 in tax credits aimed at small businesses as well as investments in clean energy and infrastructure, before starting to tighten the country's fiscal belt the following year. [I guess he’s hoping nobody notices we’re going to be buying our ‘clean energy’ from China…]

Economists say withdrawing policies aimed at boosting growth too soon helped prolong the Great Depression in the 1930s. Obama is determined to avoid repeating that mistake. But he must also ensure that investors don't lose confidence in the U.S. ability to put its fiscal house in order. [This IS NOT the freaking Great Depression; IT IS MUCH FREAKING WORSE! These idiots are acting like we still have a gold standard and a ‘closed’ economy when we have neither! That’s why nothing they’ve done so far has had any effect.*]

Democrats control both chambers in Congress. But with Republicans united in opposition to Obama's agenda, he still faces a struggle pulling together Democrats -- who badly need to show voters they are taking steps to reduce unemployment but at the same time face a voter backlash over aggressive spending measures taken to boost the economy. [Aggressive? If anything, the stimulus was too poorly directed to be effective and the fucking Republican’s had a hand in that!]

In a sign of the difficulties Obama has already faced pushing through his domestic agenda in his first year in office, the budget dropped $646 billion in revenues from a cap-and-trade system to curb greenhouse gas emissions -- signaling pessimism that Congress will pass a climate bill with this provision.

You can find the ‘adopted’ version of this article Here

*As I have commented before, it is difficult to see the ‘end game’ here. First the ‘neo-cons’ push the economy off of a cliff and then they have actively acted to block efforts to stem the damage. It’s a damn good thing they ‘own’ the media or they’d be hard pressed to control the message…which isn’t going to work much longer.

The ‘lapdog’ Democrats have not lifted a finger to slow the progress of the ‘corporate revolution’. It is striking how corporate ‘sock puppets’ have run with R’s and D’s after their names even though they all come from the same corporate mold.

There is no longer any discernible difference between Democrats and Republicans, even the ‘animosity’ between the two is ‘superficial’ at best.

Control the parties and you control the process…and it’s sure looking like it’s too late to ensure that the process remains ‘uncorrupted’.

Thanks for letting me inside your head,

Gegner