Friday Sasha blogging

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Krugman gets it right about European austerity

I've been writing lately about Paul Krugman's struggles to explain why the G20 is suddenly calling for fiscal austerity in Europe. His third attempt, "Dealing with Chermany", is a little darker — and for my money, closer to the mark — than his first two. (Recall that his first explanation for the G20's new austerity push was — madness; and his second was even stranger — an excess of virtue.)

I think he now gets at least part of the reasoning right:

So here’s where we are: China has done nothing to change its policy of massive currency manipulation, and its exports are surging. Meanwhile, Europe is going wild for fiscal austerity. Angela Merkel says that budget cuts will make Germany more competitive — but competitive against whom, exactly?

You know the answer, don’t you? Yep: everyone is counting on the US to become the consumer of last resort, sucking in imports thanks to a weak euro and a manipulated renminbi. Oh, and while they rely on US demand to make up for their own contractionary policies, they’ll lecture us on how irresponsible we’re being, running those budget and current account deficits. [my emphasis]

This makes sense, though I think there's something else going on as well. This speaks only to national interest; the Giant Pool of Money — which is meta-national — has needs too.

But let's stick with this analysis, since I think it's right as far as it goes. Once again, we're back to the familiar dynamic:

We're the addict; our monkey is endless big-screen envy.

China, Germany, and the boys who actually make things (our boys make bankers rich) are the suppliers; they dump their productive capacity on our pristine shores, and convert our personal debt into someone else's wealth.

Not pretty, but there it is. This can only end in one of two ways, both of them bad for us:

1. The plan works — and US consumers dig the personal debt hole deeper, just when they had put the shovel down.
   
   
2. The plan fails — not because the addict is cured, but because he's all tapped out. No money, no game.

You'll notice I don't list de-monkey-fication as one of the options.

Consequences of the first outcome: We kick the can of economic collapse further down the road. Score: Industrialists 1, consumers 0.

Consequences of the second: We enter a double-dip recession and a seriously lost decade of memories and reflection. Score: Industrialists 0, consumers — lay down their bats and go home.

No wonder Krugman, and a good many others, are concerned.

By the way, I'm starting to suspect that the industrialists' hand in these G20 shenanigans is aimed at pre-emptively boosting the Dow. The Dow is a terrible reflection of actual wealth held by most of us bleacher types, but it seems to act like a great encourager of spending independent of that wealth.

I've noticed this for some time — that the Dow tracks well, in broad strokes, to consumer confidence. A dip in the Dow, and people who don't own stocks feel poorer; a jump and it's all better.

These days the Dow is flickering around 10,000 — a magic number for us in the cheap seats. A Dow in the 10's or better (i.e., above 10,000), and "we" will feel like "we" escaped intact. Time to get that shiny new Wi-Fi–enabled speaker-bar. A Dow in the 9's or worse, and that old Toshiba, with its sad little built-in speakers, will have to last a while.

Wheels within wheels. Manipulate the Dow, manipulate consumer confidence — something to watch as the war between manufacturers and consumers unfolds.

Gaius Read More......

Bearded women take on old boy network in corporate France

It's about time. We could all learn a lot from the Nordic countries with their progressive policies related to women.

A group of women wearing fake beards stormed the podium at Veolia Environnement SA’s shareholders’ meeting in Paris last month, challenging Chairman Henri Proglio over the gender makeup of his overwhelmingly masculine board.

“Is it really wise to allow women to define the strategy of a company, a task requiring intelligence, an ability to react and cool-headedness?” an activist of the feminist lobby La Barbe, or “The Beard,” said to the packed hall, taunting the French water utility’s board for having only one woman member out of 17. The activist didn’t want to be identified, in line with the group’s internal policies.

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Fox flogs 'BP gave $750 million to Obama campaign' lie

Another day, another Fox News lie. The campaign contributions related to BP were primarily from BP employees and the number was closer to $70,000 so only a slight accounting error from Fox. As questionable as Rahm Emmanuel's free apartment may be, being tied to a marketing guy who did an advertising campaign is a bit different from being tied to the executive team, as it exists with the Republicans. But why let facts get in the way? More from Media Matters:

Fox News pushed the tenuous suggestion that White House chief of staff Rahm Emanuel has unethical "ties" to BP because he once lived in the home of Stan Greenberg, a D.C. research strategist who has done work for the oil company. In fact, there is no evidence that Emanuel's relationship with Greenberg -- which dates back several decades -- has anything to do with BP or benefited BP in any way. Moreover, Brian Kilmeade falsely claimed BP donated $750 million to Barack Obama's presidential campaign, which would have amounted to the entirety of Obama's campaign haul.

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'More environmentally friendly' oil dispersants from Norway rejected

To be fair to the US cleanup effort, they're not made by BP who continue to call the shots. President Hayward has other ideas about how to address the leak.

At the beginning of May, Nofo, a Norwegian industry association for battling oil spills, announced it would send 150 cubic metres (5,297 cubic feet) of dispersants.

The aid was to be used to help clean up the oil that has been gushing into the Gulf of Mexico since the BP-leased Deepwater Horizon platform exploded on April 20.

"The dispersants we use have not been certified in the United States even though they are more environmentally friendly" than the ones currently being used, Sjur Knudsen of Nofo told AFP, confirming media reports.

"The Americans are using Corexit, a powerful product," which is considered highly toxic, he said.

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BP and National Guard continue to block media access

Did the National Guard forget they don't answer to BP? Read More......

Another oil leak from another well in the Gulf of Mexico?

Please tell me this is somehow a mistake and all a big misunderstanding. In the mean time, shouldn't Gulf drilling permits be halted until the dust settles and everyone knows what is happening? From bad to worse.

During a June 8 briefing for reporters, Steven Murawski, chief science advisor for the National Oceanic and Atmospheric Association’s Fisheries Service, described deep strata of water tainted with oil. They were identified during a recent cruise in the Gulf of Mexico. A presumption had been that any clouds of oil hovering under the surface would be plumes spewed by the damaged BP well head. But the chemical fingerprinting of diffuse undersea oil clouds at one sampling site 142 nautical miles southeast of the Deepwater Horizon accident site was “not consistent with BP oil,” he pointed out.

Which begs the question: Where did this other oil come from — since Murawski noted that earlier research surveys of the area prior to the BP spill had turned up no subsea oil clouds.

At present there is no answer. But it should be noted that some recent news organizations around the gulf coast have lately begun reporting on a second leaking offshore gulf oil rig: the Ocean Saratoga.

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My musings on Lincoln beating Halter in Arkansas

Blanche advances to the Finals. By which I mean, of course, Blanche Lincoln defeated Bill Halter in the Arkansas Democratic Senate primary, with help from the White House, Goldman Sachs, and … well, let's let Jane Hamsher tell it (my emphases):

Democrats “stuck with Blanche” because she had a gazillion dollars pouring in from the Chamber of Commerce and other shadowy organizations, $3 million in PAC money from the likes of Goldman Sachs, JP Morgan, Exxon-Mobil and Wal-Mart, the support of the Democratic Party, the current President of the United States Barack Obama, and former President of the United States (and Arkansas native) Bill Clinton, who all were willing to demagogue labor’s support from Halter in an anti-labor state.

Lots to chew on here. Jane didn't mention BP in her list, but the oily have clearly invested in Blanche (sorry, "contributed to her re-election"), and she's just returned the favor. From Joe in DC (my emphasis, but this is Joe's point as well):

Senate just voted down Senator Lisa Murkowski's anti-environmental resolution to gut the authority of the EPA.

I'll post the roll call vote when it's posted. It's here. Blanche Lincoln did vote with Big Oil and the GOP. Josh Nelson provided the list of the six Dems. who voted Yes: Mark Pryor, Evan Bayh [!!], Ben Nelson, Jay Rockefeller [!!], Blanche Lincoln and Mary Landrieu.

There's been quite a bit of post-game commentary, both near-term and long. The near-term — Joe again, regarding Chuck Shumer's fist-pumpy dissing of organized labor, who wanted Halter on top (ok, that pun just writes itself) in Arkansas:

This is getting out-of-control. On Tuesday night, an anonymous "senior White House official" took a nasty swipe at labor.

Via Dana Milbank, here's Chuck Schumer's quote in response to Blanche Lincoln's win:

Sen. Chuck Schumer (N.Y.) held up two fists and said of her primary campaign: "Fighting Wall Street with one hand, unions with the other."

Really, Chuck Schumer?

Joe concludes optimistically, however (my emphasis):

Members of Congress hate primaries. Hate them. Even if they win, they hate them. Labor and progressives almost beat Lincoln in a state that's not friendly to labor and progressives. Imagine what they can do elsewhere.

Jane, seeing the same data, is more pessimistic:

While progressives have had some successes around the edges, it’s largely been Sherman’s March to the Sea for the corporate agenda during the Clinton-Bush-Obama years. Nothing progressives have achieved can compare to NAFTA, the lucrative wars in Iraq and Afghanistan, the Bush tax cuts, and the bank/insurance industry/PhRMA bailouts. Now Congress is preparing to dismantle the New Deal, selectively defaulting on Treasury bonds issued to the Social Security trust fund — targeting American senior citizens in this sudden compulsion to reduce the deficit.

This from the woman who's largely responsible for getting Halter into the race in the first place — and helping him get funded well enough to make it a toe-to-toe event.

It's a bit of a Rorschach primary, isn't it?

So I'll add my two cents. Yes, thanks to ReaganClintonBushObama (let's call them RCBO & Associates), the real rulers of Mr. Roberts Neighborhood are starting to think they can see the finish line. I suspect there's locker-room talk of sprinting the rest of the way.

It's true that, as the Gipper famously said to Pat O'Brien on Stage 12 of Warner Brothers Burbank Studios, this is certainly a time:

when the team is up against it, when things are wrong and the breaks are beating the boys ...

which to me says simply the following:

1. It's time for us to get serious about primaries. Lots of them. Joe is right. It's frankly our only hope. If we fail now, the Big Boys will go to Disneyland for their post-game celebration (on our dime, I might add). Don't hand one cent to third parties, and not one minute to them either. Both are precious.

I'll give it to you straight, right from my inner Trotsky:

You don't replace the party in power; you take over the party in power.

Tape it to your wall.

It wasn't Lenin who toppled the Czar, it was the Mensheviks. Once Kerenski and his group had set up the revolutionary government, Lenin grabbed control. The Texas Chainsaw Conservatives didn't topple the Republican Party, they took it over, one county office at a time. The Baptist Church fell to the pseudo-godly in the same godless way. (I hear other churches are fending off similar assaults from the cadres; God help them.)

Primaries, lots of them, until the Democratic party is ours. We'll need an entire party if we expect to go toe-to-toe ourselves. Yes, Obi-wan, it really is our only hope.

2. Be clear-eyed to the point of madness. I agree, this can make you crazy, but face the fact that, as Paul Krugman said in his must-read introduction to The Great Unraveling — Movement Conservatism is "a revolutionary power... a movement whose leaders do not accept the legitimacy of our current political system." This is not your daddy's conservative movement. Reagan was a revolutionary; he took power by revolutionary means; as did Bush Jr.; as did John Roberts by lying through his teeth at his confirmation hearing.

We're fighting a revolutionary force. It's a world-historical moment. We can't afford to be confused.

3. The Big Boys are getting lazy (you know who I mean — anyone resembling BP and their retainers). They think they're in the fourth quarter, and it's only the third. They think they own the refs. They're getting careless — tone-deaf and arrogant.

Time to slip them the shiv, and by that I mean, Occam's switchblade. Now's the time to throw big lights on who they are and brand them — like calves. (Branding does work both ways, you know — you always brand yourself by your behavior.)

So let them appear to be what they really are — they're eager to dance their little end-zone waggle — and let us be relentless about putting that dance on the world's bright billboard. No one should be confused. There's just too much at stake.

That's it for now — a three-point action list for the next few years. I've given this a lot of thought; if we're going to get out of this mess, these three points are the route. And if we don't get out of this mess, forget going to Europe — the disease is being aggressively exported. It could get there ahead of you.

I'll have more to say about Krugman's "revolutionary power" in future — much more. BP is doing a very good job of being who they actually are, and I'll be shining my own little mini-Maglite® Solitaire on it. This tragedy is instructive; I personally plan on doing my own small part.

Last words — Stay optimistic, and stay unconfused. These really are important times. If this were a science-fiction story, we're in Terminator 1.

Terminally yours,

GP Read More......

GOP Congressman with BP stock will participate in criminal investigation

There's nothing quite like the interesting ethics of the Republican Party.

A multimillionaire House Republican who owns thousands of shares of BP stock has no plans to recuse himself from a congressional investigation related to the Gulf oil spill or from votes on Capitol Hill that could affect his investments in the oil company.

Rep. James Sensenbrenner of Wisconsin has avoided directly criticizing BP for the spill itself. At the same time, he has watched his BP stock tank in value.

Worth more than $251,000 just a few years ago, Sensenbrenner's 3,604 shares of BP PLC stock had plunged in value to just $118,000 by the end of trading Thursday. That's roughly half their value the day before the April 20 oil spill. Sensenbrenner has said his net worth is about $10 million.

Note from Joe: Sensenbrenner's nickname is "Tex" -- a moniker he reportedly really hates. He got that nickname because he's an heir to the Kotex fortune. His great-grandfather invented the Kotex product. Yeah, that's why he's rich. Family money. Kotex money. Read More......

Oil leak estimates now doubled to 40,000 barrels per day

This is not the first time the numbers have been substantially raised. BP held firm to the initial 5,000 barrel per day estimate and the numbers were later raised to 20,000. The bad news is that outside scientists are now estimating the leak to be closer to 40,000 barrels per day. That is big news. BP's claim - and remember, this is BP we're talking about - is that they are collecting around 15,000 barrels per day with their latest temporary solution.

As many as 40,000 barrels (1.7m gallons) of oil a day may have been gushing out from a blown-out Gulf of Mexico well, doubling many estimates.

The US Geological Survey says that flow rate could have been reached before a cap was put on the well on 3 June.

BP's chairman has been asked to meet Barack Obama next week, amid assurances from the UK and US that bilateral ties will not be affected by the crisis.

A strange end result of this situation is the increasing focus by some in the UK on a supposed "anti-British" campaign in America. I still don't see anything like that at all. It's easy to feel for the millions of people in the UK who have relied heavily - perhaps too heavily - on BP for their pension funds. After the latest economic fiasco taking another hit has to be painful.

The same could just as easily be said for Americans though who also are suffering and now have yet another irresponsible business who are dumping costs on the American public. No matter what, the US will get stuck with some of these costs just as it happened in Alaska. The annoying part in this fiasco is that the GOP is rallying to support a taxpayer funded oil cleanup bailout for BP. Talk about slimy. Read More......

Friday Morning Open Thread

Good morning.

Let's be realistic about the biggest news story in the world today. It's not politics. It's the World Cup, which starts today in South Africa. The host, South Africa, plays Mexico at 10 a.m. Eastern time in Johannesburg and Uruguay plays France at 2:30 PM Eastern in Cape Town. FIFA has the full schedule and lets you find set the time to your own time zone. The U.S. team plays England tomorrow. In DC, tomorrow's games can be watched right in Dupont Circle, according to DCist. I hope this is a huge success for South Africa.

The White House has demanded that the Chair of BP and other top execs from the company attend a meeting at the White House. Wow. Makes it seem like that crack team at the White House is right on top of the situation -- about five or six weeks late.

Neither the House nor the Senate are in session today.

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UK prepares to release final 'Bloody Sunday' report

The event dates back to 1972 though this commission began during the Tony Blair era 12 years ago. The initial inquiry was a sham which didn't help an already volatile situation. The event was a peaceful march that turned into a bloodbath as British soldiers shot 27 marchers, killing 14 of them. The excessive British violence led to much more violence in the region for years. With this new report there is a very high likelihood some of the British soldiers involved will be heading to prison. Justice has been slow to say the least.

The long-awaited report into the Bloody Sunday massacre will conclude that a number of the fatal shootings of civilians by British soldiers were unlawful killings, the Guardian has learned.

Lord Saville's 12-year inquiry into the deaths, the longest public inquiry in British legal history, will conclude with a report published next Tuesday, putting severe pressure on the Public Prosecution Service in Northern Ireland to prosecute soldiers.

Lord Trimble, the former leader of the Ulster Unionists and one of the architects of the Good Friday agreement, revealed to the Guardian that when Tony Blair agreed to the inquiry in 1998, he warned the then prime minister that any conclusion that departed "one millimetre" from the earlier 1972 Widgery report into the killings would lead to "soldiers in the dock".

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Anti-immigrant, anti-Islam extreme right party finishes strong in Dutch elections

They may even be against the wheel they're so extreme. BBC:

The unexpected big winner was the anti-Islam Freedom Party, the PVV, which took its number of seats from nine in the last parliament to 24 - its best-ever finish.

The campaign had been dominated by a debate over the economy, which was thought to have eclipsed immigration as an election issue.

But the strong showing for the Freedom Party, led by the controversial Geert Wilders, is a sign that immigration was still a powerful theme, correspondents say.

Mr Wilders has campaigned to stop the "Islamisation of the Netherlands".

He wants the Koran banned, and has suggested a tax on headscarves worn by Muslim women.

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Delta tries even harder to own title of 'worst airline in the world'

Sending kids to the wrong city isn't bad enough. Now they're depriving poor kids in Africa water. This guy has been trying to compete in a number of competitions to raise money for charity and Delta destroyed his carbon bike. Don't they owe him something?

More on this story here and here. Read More......