Is this a picture of the Double Dip starting?

In a Paul Krugman post about the good news in Fed Chairman Ben Bernanke's speech — ironically, the good news is that Bernanke now acknowledges the bad news — the Professor includes a Fed-generated graph of where we are.

Normally, to show where we are in the Great Recession, Krugman graphs "real employment," the ratio of employed people to eligible population. He considers this a much more accurate view of actual unemployment than the headline unemployment number, which has been tweaked by past presidents beyond recognition. (I agree.)

But this time, his graph of where-we-are shows GDP — in particular the ratio of actual GDP to the CBO projection of potential GDP consistent with full employment. That graph looks like this:


A few things to notice: (1) This is a ratio, so "1.00" on the vertical scale up near the top is the place where the two values are equal. It's the 100% mark, the place at which Real GDP equals Potential GDP (as defined).

(2) The chart starts at 2001, so the initial drop you see from 101% to 98% is the Clinton tech bubble bursting, followed by a slow recovery.

(3) About that 2001–2007 recovery: As we noted here, most of the income growth in that recovery was captured by the upper 1% of the population.

The exact number: $2 of every $3 went into their pockets. For the upper 1%, that growth was rain from heaven, which the rest of us didn't see. (Note that GDP growth is more than just income growth, but income growth is a large part.) I'll have more to say about the upper 1% — who they are and how they live — shortly.

(4) And finally, notice the tail. If that doesn't look like a double-dip starting, I don't know what does.

The brief rise during 2010 is the inadequate stimulus doing its feeble best. (Note that the 2010 peak of just below 94% is far short of the post-Clinton low of 98%. Another indication that we needed much more stimulus than we got.)

This ratio might be a worthwhile metric to keep an eye on. I hope the Professor keeps it updated.

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Boehner and Cantor unsure about emergency aid for hurricane without budget cuts

If you're not part of the super rich or a corporate interest, you really don't count with the Republicans. Huffington Post:

Cantor raised some eyebrows on Wednesday when, in the aftermath of the 5.8 magnitude earthquake that rattled the East Coast and originated in his district, he said Congress will help those hurt by the earthquake but will require finding offsets for any federal aid.

"When there's a disaster there's an appropriate federal role and we will find the monies," Cantor said during a news conference in Mineral, Va. "But we've had discussions about these things before and those monies will be offset with appropriate savings or cost-cutting elsewhere in order to meet the priority of the federal government's role in a situation like this."

Cantor spokesman Brad Dayspring on Friday declined to say where Republicans would look to make cuts to pay for a potential storm aid package.

Boehner's office punted when asked about this. Is it really that difficult to answer? Read the rest of this post...

Ron Paul: FEMA not needed for national emergencies

Um, no. Ron Paul is and always will be a loon who is seriously out of touch with the modern world whether it's his remarks on FEMA, his backwards foreign policy ideas, his economic ideas or his remark that abortion is "the most important issue of our age." Read the rest of this post...

Obama admin moves towards approval of tar sands pipeline

This isn't a surprise. It's just incredibly disconcerting:

The State Department on Friday released its final environmental assessment of the Keystone XL, removing a major barrier to the construction of the 1,700 mile oil pipeline, which would stretch from Alberta, Canada, to the Gulf Coast.

In a report consistent with the agency's earlier findings, the final Environmental Impact Statement found the proposed pipeline would have "no significant impact" to the vast majority of resources along the pipeline corridor, and suggested moving forward on the project with limited modifications.

Kerri-Ann Jones, assistant secretary of the Bureau of Oceans and International Environmental and Scientific Affairs, emphasized that no final decisions have been made

"This is not the rubber stamp for this project," Jones told reporters in a conference call on Friday. "The permit for this project has not been approved or rejected at all ... we will continue to have more discussion."

Right. This disaster is heading towards Presidential approval. Big oil always wins in Washington.

This pipeline is becoming the defining environmental issue for Obama. It's raising the political stakes for the President with one key part of his base. Via Bloomberg:

The outcome on the pipeline will be an issue in President Barack Obama’s campaign for re-election, said Michael Brune, executive director of the San Francisco-based Sierra Club.

“The decision-making authority is solely the president’s,” Brune said today on a conference call with other groups. “It will be increasingly difficult to mobilize the environmental base and to mobilize in particular young people to volunteer, to knock on thousands of doors, to put in 16-hour days, to donate money when they don’t think the president is showing the courage to stand up to big polluters.”

I suspect a lot of those activists will spend the next 15 months fighting this pipeline instead of canvassing for Obama. But, they're being forced to do that because of Obama. I'm sure Jim Messina and the other campaign operatives will understand. Maybe, they should call the oil industry's lobbyists. I'm sure they're going to jump right on Obama's campaign bandwagon.

Bill McKibben was on The Last Word on Thursday to discuss the political implications.

Visit msnbc.com for breaking news, world news, and news about the economy

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Irene could cost $4.7 billion, possibly tens of billions

Joe linked to Nate Silver's article yesterday that suggested costs could run as high as $35 billion in a worst case scenario. The $4.7 billion is the latest estimate before Irene strikes but we all know how unpredictable hurricanes can be. It could be better and it could be worse but either way, this is the last thing the US economy needs right now.

Hurricane Irene is expected to make landfall in North Carolina as a Category 2 storm early Saturday, then move up the Eastern Seaboard, where more than 50 million people from the Carolinas to Massachusetts could be in the path of heavy rain and tropical-force winds. The economic impact of the hurricane largely will depend on factors that include the storm's size, where it makes landfall, and the speed at which it's moving when it hits the coast. But experts already are forecasting billions of dollars in losses.

Irene likely to bring high wind, insurance payouts

"It's probably going to be very damaging," said Roger Pielke, a University of Colorado professor and fellow of the Cooperative Institute for Research in Environmental Sciences.

A computer model of Irene's potential impact puts the estimated damage at $4.7 billion, according to research by Pielke and catastrophe-insurance provider ICAT. That figure, which came from analyzing 27 comparable storms dating back to 1913, includes destruction of homes, cars, public infrastructure and other property caused by high winds and flooding. The number doesn't factor in the added impact of lost sales from shuttered restaurants, quiet casinos, canceled flights and boarded-up stores — all of which could add billions of dollars to the fallout.

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New law in China allows police to hold suspect for 6 months

The Olympics sure changed a lot and China remains very concerned about its public image. The Guardian:

Chinese police will gain new legal powers to detain suspects for up to six months without telling their families where or why they are held, according to a state newspaper's account of planned reforms.

Human rights activists and legal scholars warned that the change would legitimise an alarming pattern of detentions under the residential surveillance law, which was initially intended as a less punitive measure than formal detention.

Most of those who went missing in a crackdown on activists, dissidents and lawyers this year were taken to secret locations chosen by police. They were held for weeks or even months under residential surveillance. The law does not specify that relatives must be informed, presumably because it was assumed suspects would be held at their homes. In comparison, police must inform relatives within 24 hours of detention and must seek prosecutors' approval for arrest within 30 days.

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Why are people being evicted from a desert?

Reason TV has been looking into some very strange and heavy handed tactics being used to drive people off desert land in the Antelope Valley, LA County.



For people who prefer to read, LA Weekly has an article on the situation.

Mark Frauenfelder over at Boing Boing is as puzzled by this piece as I am. Why would the local government be trying to drive people off their land when there is nobody else living in the area. More important, why won't the county supervisor, Michael Antonovich answer any questions on the matter?

The local residents being bullied think that there is some kind of development plan behind the moves. If I was in that situation I would probably come to the same conclusion.

From a political perspective, Republican Antonovich has to go. Whatever his motives, whatever his reasons, there should be no place in public office for officials who won't explain or be accountable for their actions. Read the rest of this post...

NYC orders evacuation of 370,000 and shuts subway

UPDATE @ 12:05 PM from Joe: Irene is battering the North Carolina coast right now. The is a very big storm that will be wreaking havoc up the East Coast over the next couple days: lots of rain, intense wind, storm surges, tornadoes. Irene has it all. The Weather Channel reports it will be a hurricane all the way up the coast.

Pam Spaulding posted a video from her home in Durham. The first bands from the storm have hit the DC area. We'll be getting the winds later today. As of noon, all mass transit in NYC transit is now shut down.

Here's the track, via the National Hurricane Center, as of 11 AM ET. Red lines indicate hurricane warnings. The blue is for tropical storm warnings. You can see that the storm will be hugging the coast. These storms draw strength from the warm water, so it's got an energy source:

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Amazing. Irene is due to hit the coast of North Carolina around 8AM today but more updates during the day.

New York City officials issued what they called an unprecedented order on Friday for the evacuation of about 370,000 residents of low-lying areas at the city’s edges — from the expensive apartments in Battery Park City to the roller coaster in Coney Island to the dilapidated boardwalk in the Rockaways — warning that Hurricane Irene was such a threat that people living there simply had to get out.

Officials made what they said was another first-of-its-kind decision, announcing plans to shut down the city’s entire transit system Saturday — all 468 subway stations and 840 miles of tracks, and the rest of the nation’s largest mass transit network: thousands of buses in the city, as well as the buses and commuter trains that reach from Midtown Manhattan to the suburbs.

Underscoring what Mayor Michael R. Bloomberg and other officials said was the seriousness of the threat, President Obama approved a request from Gov. Andrew M. Cuomo of New York to declare a federal emergency in the state while the hurricane was still several hundred miles away, churning toward the Carolinas. The city was part of a hurricane warning that took in hundreds of miles of coastline, from Sandy Hook, N.J., to Sagamore Beach, Mass.

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Elvis Costello - Beyond Belief

What is beyond belief is that the northeast in the US is about to get clobbered by a hurricane days after a surprisingly large earthquake. The northeast is pretty familiar with winter storms but the region really isn't prepared for either earthquakes or hurricanes. Read the rest of this post...

Report: political prisoners killed in Gaddafi prison camps

If Gaddafi survives this fight, he will certainly die in prison. CNN:

Eyewitnesses say Gadhafi loyalists killed "numerous detainees" this week at two military camps in Tripoli, Amnesty International reported on Friday.

Escaped detainees from the Khilit al-Ferjan and Qasr Ben Ghashir camps provided testimony to the human rights group.

The loyalist forces used grenades and gunfire on scores of prisoners at Khalit al-Ferjan after around 160 detainees fled a metal hangar.

"I was in shock when the grenades exploded," escaped detainee Akram Mohamed Saleh said.

"There was so much confusion around me, smoke all around, people screaming for help and trying to flee. I saw dozens of bodies, and I was covered with blood and human flesh."

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Diamond planet discovered

How many carats would that be?

The new planet is far denser than any other known so far and consists largely of carbon. Because it is so dense, scientists calculate the carbon must be crystalline, so a large part of this strange world will effectively be diamond.

"The evolutionary history and amazing density of the planet all suggest it is comprised of carbon—i.e.a massive diamond orbiting a neutron star every two hours in an orbit so tight it would fit inside our own Sun," said Matthew Bailes of Swinburne University of Technology in Melbourne.

Lying 4,000 light years away, or around an eighth of the way towards the center of the Milky Way from the Earth, the planet is probably the remnant of a once-massive star that has lost its outer layers to the so-called pulsar star it orbits.

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