Mike Whitney: Swan Song for the Euro

By Mike Whitney

Created Aug 8 2011 - 10:38am

http://smirkingchimp.com/thread/mike-whitney/37782/swan-song-for-the-euro

We all know the drill. Bond yields start to spike in one of the smaller countries in the EU, and before you know it, the bigger countries are called in to bail them out. We've seen the same thing over and over again.

This time, Italy and Spain are in the crosshairs. Jittery investors have fled their bond markets for the safety of German Bund, US Treasuries and precious metals. The selloff has sent Italian bond yields into the stratosphere making it more expensive for the government to fund its operations. So, the debts and deficits get bigger and the downward spiral begins. Same old, same old. That's why the ECB called an emergency meeting of the EU's Governing Council on Sunday to slap together another 11th hour bailout before the markets opened on Monday. If they had ignored the problem, it would have been Lehman Brothers all over again; plunging stock markets, panicky bank runs, and a full-blown global financial crisis. Here's a summary from Bloomberg:

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Barbara Ehrenreich: Nickel and Dimed (2011 Version)

By Barbara Ehrenreich
Posted on August 9, 2011, Printed on August 9, 2011
http://www.tomdispatch.com/blog/175428/

On Turning Poverty into an American Crime
By Barbara Ehrenreich

I completed the manuscript for Nickel and Dimed in a time of seemingly boundless prosperity. Technology innovators and venture capitalists were acquiring sudden fortunes, buying up McMansions like the ones I had cleaned in Maine and much larger. Even secretaries in some hi-tech firms were striking it rich with their stock options. There was loose talk about a permanent conquest of the business cycle, and a sassy new spirit infecting American capitalism. In San Francisco, a billboard for an e-trading firm proclaimed, “Make love not war,” and then -- down at the bottom -- “Screw it, just make money.”

When Nickel and Dimed was published in May 2001, cracks were appearing in the dot-com bubble and the stock market had begun to falter, but the book still evidently came as a surprise, even a revelation, to many. Again and again, in that first year or two after publication, people came up to me and opened with the words, “I never thought...” or “I hadn’t realized...”

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Laurie Penny: Panic on the Streets of London

Published on Tuesday, August 9, 2011 by Penny Red

http://pennyred.blogspot.com/2011/08/panic-on-streets-of-london.html

by Laurie Penny

I’m huddled in the front room with some shell-shocked friends, watching my city burn. The BBC is interchanging footage of blazing cars and running street battles in Hackney, of police horses lining up in Lewisham, of roiling infernos that were once shops and houses in Croydon and in Peckham. Last night, Enfield, Walthamstow, Brixton and Wood Green were looted; there have been hundreds of arrests and dozens of serious injuries, and it will be a miracle if nobody dies tonight. This is the third consecutive night of rioting in London, and the disorder has now spread to Leeds, Liverpool, Bristol and Birmingham. Politicians and police officers who only hours ago were making stony-faced statements about criminality are now simply begging the young people of Britain’s inner cities to go home. Britain is a tinderbox, and on Friday, somebody lit a match. How the hell did this happen? And what are we going to do now?

In the scramble to comprehend the riots, every single commentator has opened with a ritual condemnation of the violence, as if it were in any doubt that arson, muggings and lootings are ugly occurrences. That much should be obvious to anyone who is watching Croydon burn down on the BBC right now. David Lammy, MP for Tottenham, called the disorder 'mindless, mindless'. Nick Clegg denounced it as 'needless, opportunistic theft and violence'. Speaking from his Tuscan holiday villa, Prime Minister David Cameron – who has finally decided to return home to take charge - declared simply that the social unrest searing through the poorest boroughs in the country was "utterly unacceptable." The violence on the streets is being dismissed as ‘pure criminality,’ as the work of a ‘violent minority’, as ‘opportunism.’ This is madly insufficient. It is no way to talk about viral civil unrest. Angry young people with nothing to do and little to lose are turning on their own communities, and they cannot be stopped, and they know it. Tonight, in one of the greatest cities in the world, society is ripping itself apart.

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Dean Baker: Protest Movements Teach Economics to Bankers

Published on Monday, August 8, 2011 by Inter Press Service

http://www.commondreams.org/headline/2011/08/08-7

by Dean Baker

WASHINGTON - The European Central Bank (ECB) is run by people who are not very good at economics. They continue to adhere to a fundamentally wrongheaded view of the economy and the central bank's role within it.

Anti-austerity protesters faced down Greek police in Athens this summer. Similar confrontations happened across Europe as workers and student resisted draconian cuts to social services to please bond holders and the central bank. While the governments may be willing to inflict upon their population whatever pain the ECB requests, the popular movements are making this an increasingly difficult process. The governments of these countries are being forced to recognise that they must consider public opinion and not just accept the dictates of the ECB. Unfortunately, there is no internal pressure for change because, like the Communist Party in the Soviet Union, acceptance of the ideology is the price for admission into the clique of economists who can influence the ECB.

The central tenet of ECB dogma is that the central bank should target a low inflation rate - two percent - and pretty much ignore everything else in the economy.

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Walden Bello: The Crisis of Humanitarian Intervention

Published on Tuesday, August 9, 2011 by Foreign Policy in Focus

http://www.fpif.org/articles/the_crisis_of_humanitarian_intervention

by Walden Bello

Events in Libya and Syria have again brought to the forefront the question of armed humanitarian intervention or the “responsibility to protect.”

Our hearts all go out to the unarmed demonstrators seeking to bring down corrupt dictatorships that are a plague on their people. In Tunisia and Egypt, the people rose and deposed dictators on their own. Armed supporters of the Mubarak regime did attack and even fire on people in Tahrir Square, but a massive crackdown was avoided when the military decided not to take the side of the dictator. 

Things have not been so simple since then. Libyan despot Muammar Gaddafi came down hard on civilian protesters, providing the opportunity for the United States and the North Atlantic Treaty Organization (NATO) to intervene militarily by waging an air war and arming the rebels. Today, the Assad dictatorship's massive repression in cities and towns in Syria that have risen in revolt has also sparked agitation for intervention in the West.

Is it ever legitimate to supersede the principle of national sovereignty with a military intervention aimed at protecting citizens from their government?  And if the answer is yes, what circumstances would justify this course of action and how should it be carried out?

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The Daily Bail: J.P. Morgan's Food Stamp Monopoly: The More Americans That Fall Into Poverty The More Money Jamie Dimon Makes

Bank Makes Huge Profits On Food Stamps

The Daily Bail

http://dailybail.com/home/jp-morgans-food-stamp-monopoly-the-more-americans-that-fall.html

JP Morgan is the largest processor of food stamp benefits in the United States.  JP Morgan has contracted to provide food stamp debit cards in 26 U.S. states and the District of Columbia.  JP Morgan is paid for each case that it handles, so that means that the more Americans that go on food stamps, the more profits JP Morgan makes.  Yes, you read that correctly.

In the video posted above, JP Morgan executive Christopher Paton admits that this is "a very important business to JP Morgan" and that it is doing very well.  Considering the fact that the number of Americans on food stamps has exploded from 26 million in 2007 to 43 million today, one can only imagine how much JP Morgan's profits in this area have soared.  But doesn't this give JP Morgan an incentive to keep the number of Americans enrolled in the food stamp program as high as possible?

There are just some things that are a little too "creepy" to be "outsourced" to private corporations.  The JP Morgan executive in the interview below does his best to put a positive spin on all this, but it just seems really unsavory for a big Wall Street bank to be making so much money off of the suffering of tens of millions of Americans....

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"Rachel Rose Hartman" - Poll suggests 2012 change in power in Washington

http://news.yahoo.com/blogs/ticket/poll-suggests-2012-change-power-washington-131541841.html

By Rachel Rose Hartman

Prior to the elections of 1994, 2006 and 2010 when party control changed hands in the House or Senate, many Americans said incumbents didn't deserve re-election.

Now, we're seeing the highest number of Americans in two decades who agree with that sentiment, spelling another potential "wave" election for 2012, USA Today reports.

Only 24 percent of all adults surveyed in the USA Today/Gallup poll said most members of Congress deserve re-election "the lowest percentage since Gallup began asking the question in 1991" the newspaper reports.  USA Today notes this is similar to the level of support polled prior to the 1994, 2006 and 2010 elections. In 1994, Republicans won control of both the House and Senate. In 2006, Democrats won control of both the House and Senate. And last fall, Republicans won control of the House.

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RAW STORY: Second U.S. recession could be worse than the first

RAW STORY
Sunday, August 7th, 2011 -- 9:56 pm

 http://www.rawstory.com/rs/2011/08/07/second-u-s-recession-could-be-worse-than-the-first/

A second recession, what many are calling the double-dip recession, could be on its way, economists warn. And should it come, it will probably be even more devastating than the previous period of economic woe.

“It would be disastrous if we entered into a recession at this stage, given that we haven’t yet made up for the last recession,” Conrad DeQuadros, senior economist at RDQ Economics, told the New York Times.

The Standard and Poor's downgrade of the U.S.'s credit rating bodes ill for the world's financial markets as well as the domestic market.

President Barack Obama, once the debt deal with Congress to avoid a debt default was struck, announced a pivot to focus on jobs.

"I'll continue also to fight for what the American people care most about: new jobs, higher wages and faster economic growth," Obama said in a statement to press after the debt deal was passed last week.

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"Haaretz Editorial" - The Israeli protest has turned into a revolution

Following decades in which the public has curled up in its indifference and allowed a handful of politicians to run the country as they wished, the rules of the political game have changed.

Haaretz Editorial  02:10 08.08.11

http://www.haaretz.com/misc/article-print-page/the-israeli-protest-has-turned-into-a-revolution-1.377529?trailingPath=2.169%2C2.225%2C2.227%2C

For more than three weeks Israeli society and polity have been shaken by waves of social protest of the sort that has never been seen here before. This protest reached a new peak on Saturday night with demonstrations that saw hundreds of thousands of Israelis take to the streets. Such a display of power is apparently far from being over.

The protest has already achieved much. It has stirred civil society to become involved, and to show solidarity following many years of complacency. It has also altered the social agenda in Israel, and political-security discourse has given way to a socioeconomic one, which has taken center stage in an unprecedented way.

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Robert Becker: Tea Party Terror -- An Unholy War to Gain Tyranny of the Majority

By Robert Becker, The Smirking Chimp
Posted on August 9, 2011, Printed on August 10, 2011
http://www.alternet.org/story/151957/tea_party_terror%3A_an_unholy_war_to_gain_tyranny_of_the_majority

Whether or not V.P. Biden tagged the Tea Party "terrorists," more sentient beings have dramatized their politics of crude intimidation with howls about ransom demands, hostage-taking, blackmail and extortion. The stolid NY Times' Joe Nocera condemned this "jihad against America" intent on "blowing up the country." Right, an unholy war by a minority of fanatics who take no prisoners, nor apologize for innocent victims.

We've gone way beyond states' rights on hot-button cultural fixations, even nullifying specific, objectionable "liberal" giveaways. Does not the manufactured debt fallout — nullification of government integrity — demand strong retaliation by the adults before this unholy war impales the ultimate casualty — it's the future, stupid? What defines a third world debtor nation more emphatically than obsolete infrastructure, no new growth industries or updated labor force, paltry education and research commitments, no master environmental, regulatory and/or energy planning? What distinguishes the Tea Party insurrection (and backers) from suicide bombers or unhinged shooters of House members or abortion doctors, is scope, funding, and organization — plus collusion with a radicalized GOP and the 87 rogues the rightwing shoehorned into Congress.

The first, worst casualty in this holy war — all policy contradictions aside — isn't just the truth but majority rule, the result of transforming government from gridlock to self-inflicted paralysis that kills the revenue potential that could solve any big problems. More or less, America was plodding along towards only moderate inequality when 2000 kicked off body blows against majority rule. The rightwing Bush-Cheney gang viewed majority will as a problem open to manipulation, rarely the solution or heart of America. Cheney scorned all polls.

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