I was part of a neighborhood turnaround in St. Paul from the mid 1970s to 1989. It was an amazingly interesting experience because we were trying to reverse the decay and plunging property values that had turned the city's most fashionable neighborhood into a frightening place where 50% of the building were boarded up.
The lessons I learned included:
It is quite possible for real estate to decrease in value--and once it begins to decrease, only heroic efforts can arrest the decline.
Aesthetics is the most overlooked driver of economic behavior. Our neighborhood began to show new life when a few projects were especially well-done and the tour buses started driving by.
It only takes a handful of talented and dedicated people to make a big difference. For example, I had a neighbor who was supremely gifted when it came to designing paint schemes for Victorian houses encrusted with gingerbread. How good was he? When National Geographic did a photoshoot of St. Paul, one of his houses made the cover. A highly successful book called Painted Ladies included two of his houses. A better example of individual genius could hardly be found. Yet when he sold his paint jobs, he would always appeal to civic pride. "A beautiful house is what you do for your neighbors, your street, and your community--after all, they will see it more than you will because you are inside." And because he was able to convince so many people to spend the extra money it took to make their houses look better, the whole neighborhood came back from collapse. It's a VERY cool place to be these days.
My neighbor the painter understood the most important economic lesson of all--ALL successful endeavors are a careful balance between individual freedom and initiative and an understanding of what is owed to the community.
Which is why I profoundly disagree with Libertarians on economics even though I agree with much of what they have to say about drug policy or international adventurism. The me-first thinking of a Libertarian is what destroyed our neighborhood in the first place--it is just a fancy expression of the slum-landlord mentality. Worse--the slum-landlord thinking that is being taught in our finest economic departments in our most prestigious institutions of higher learning has collapsed the global economy and given us the Gulf Blowout.
So I must thank the geniuses over at DU for breaking down the Libertarian impulse into its finer gradations of insanity. (click for full size)
Plastic solar cells mean they can be put more places. It is insanely hard to do which explains why it hasn't been done before.
A Simpler Route to Plastic Solar Cells
A new method will reduce the cost and complexity of manufacturing.
By Katherine Bourzac
THURSDAY, JUNE 24, 2010
A simplified process for printing polymer solar cells could further reduce the costs of making the plastic photovoltaics. The method, which has been demonstrated on a large-area, roll-to-roll printing system, eliminates steps in the manufacturing process. If it can be applied to a wide range of polymer materials, it could lead to a fast and cheap way to make plastic solar cells for such applications as portable electronics, photovoltaics integrated into building materials, and smart fabrics.
Polymer solar cells aren't as efficient as silicon ones in converting sunlight into electricity, but they're lightweight and cheap, a trade-off that could make them practical for some applications. And they're compatible with large-area printing techniques such as roll-to-roll processing. But manufacturing the solar cells is challenging, because if the polymers aren't lined up well at the nanoscale, electrons can't get out of the cell. Researchers now use post-printing processing steps to achieve this alignment. Eliminating these extra steps will, University of Michigan researchers hope, bring down manufacturing costs and complexity. more
And the millions of jobs the use of these highly irresponsible financial instruments have already destroyed? Never mind.
The Bank Lobby Gets Desperate on Derivatives
Posted by Zach Carter at 11:08 am
June 23, 2010
Astonishingly, as Wall Street reform enters its final hours a tired, generic corporate refrain against regulation is gaining traction. As bigwig bankers and their lobbyist brethren fight to defeat tough new rules on derivatives—the crazy casino that brought down AIG—all their sloganeers can come up with is the trite wail that serious rules will send this risky business overseas. It’d be funny if members of Congress weren’t taking it seriously.
“Oh no—the business will go overseas!” is the last-ditch, we’re-about-to-lose-this-one cry of despair for corporate executives in every industry. Crack down on a profitable abuse in the United States, and the entire business will move to London or Mumbai, sending jobs and tax revenue abroad with it– or so the argument goes. You only hear this line when CEOs know they have no case, and have to divert attention away from the real substance of the policy debate. In the case of Wall Street abuses, this nonsense is especially ridiculous. The bank lobby really just doesn’t have any good arguments to launch in its favor, so it’s falling back on generic corporate jargon.
In reality, the U.S. has extremely broad authority to crack down on derivatives activity abroad, we just don’t have a whole lot of good rules on derivatives for regulators to enforce. It’s extremely difficult for financial institutions to simply offshore their risky derivatives business to avoid oversight. Under current law, the Commodity Futures Trading Commission has the authority to regulate any trading done by foreign firms on behalf of U.S. clients, any trading of U.S. assets conducted by foreign institutions and any trading that causes a “substantial disruption” in U.S. markets. Just about anything the CFTC wants to get its hands on, it can, and the current CFTC Chairman, Gary Gensler, is a committed reformer. We just need to write good rules for his agency to enforce.
Moreover, finance tricksters will have no incentive to move their destructive derivatives trading abroad, because the rules in other countries are, in fact, much tougher than those the U.S. is currently considering. more
There is no realistic way to fix the economy of USA until health care becomes something besides a method for greedheads to prey of the sick and needy.
U.S. scores dead last again in healthcare study
Maggie Fox, Health and Science Editor
WASHINGTON
Wed Jun 23, 2010 4:48pm EDT
(Reuters) - Americans spend twice as much as residents of other developed countries on healthcare, but get lower quality, less efficiency and have the least equitable system, according to a report released on Wednesday.
The United States ranked last when compared to six other countries -- Britain, Canada, Germany, Netherlands, Australia and New Zealand, the Commonwealth Fund report found.
"As an American it just bothers me that with all of our know-how, all of our wealth, that we are not assuring that people who need healthcare can get it," Commonwealth Fund president Karen Davis told reporters in a telephone briefing.
Previous reports by the nonprofit fund, which conducts research into healthcare performance and promotes changes in the U.S. system, have been heavily used by policymakers and politicians pressing for healthcare reform.
Davis said she hoped health reform legislation passed in March would lead to improvements.
The current report uses data from nationally representative patient and physician surveys in seven countries in 2007, 2008, and 2009. It is available here
In 2007, health spending was $7,290 per person in the United States, more than double that of any other country in the survey.
Australians spent $3,357, Canadians $3,895, Germans $3,588, the Netherlands $3,837 and Britons spent $2,992 per capita on health in 2007. New Zealand spent the least at $2,454.
This is a big rise from the Fund's last similar survey, in 2007, which found Americans spent $6,697 per capita on healthcare in 2005, or 16 percent of gross domestic product.
"We rank last on safety and do poorly on several dimensions of quality," Schoen told reporters. "We do particularly poorly on going without care because of cost. And we also do surprisingly poorly on access to primary care and after-hours care." more
got to the top of the economic charts? Me too. Especially since it is so obviously insane. Perhaps this is the logical outcome of training a whole generation of "economists" with no skills except the ability to do fast algebra.
EU Today, US Tomorrow
Europe's Fiscal Dystopia: the "New Austerity" Road
By MICHAEL HUDSON
Europe is committing fiscal suicide – and will have little trouble finding allies at this weekend’s G-20 meetings in Toronto. Despite the deepening Great Recession threatening to bring on outright depression, European Central Bank (ECB) president Jean-Claude Trichet and prime ministers from Britain’s David Cameron to Greece’s George Papandreou (president of the Socialist International) and Canada’s host, Conservative Premier Stephen Harper, are calling for cutbacks in public spending.
The United States is playing an ambiguous role. The Obama Administration is all for slashing Social Security and pensions, euphemized as “balancing the budget.” Wall Street is demanding “realistic” write-downs of state and local pensions in keeping with the “ability to pay” (that is, to pay without taxing real estate, finance or the upper income brackets). These local pensions have been left unfunded so that communities can cut real estate taxes, enabling site-rental values to be pledged to the banks of interest. Without a debt write-down (by mortgage bankers or bondholders), there is no way that any mathematical model can come up with a means of paying these pensions. To enable workers to live “freely” after their working days are over would require either (1) that bondholders not be paid (“unthinkable”) or (2) that property taxes be raised, forcing even more homes into negative equity and leading to even more walkaways and bank losses on their junk mortgages. Given the fact that the banks are writing national economic policy these days, it doesn’t look good for people expecting a leisure society to materialize any time soon.
The problem for U.S. officials is that Europe’s sudden passion for slashing public pensions and other social spending will shrink European economies, slowing U.S. export growth. U.S. officials are urging Europe not to wage its fiscal war against labor quite yet. Best to coordinate with the United States after a modicum of recovery.
Saturday and Sunday will see the six-month mark in a carefully orchestrated financial war against the “real” economy. The buildup began here in the United States. On February 18, President Obama stacked his White House Deficit Commission (formally the National Commission on Fiscal Responsibility and Reform) with the same brand of neoliberal ideologues who comprised the notorious 1982 Greenspan Commission on Social Security “reform.” more
Got a case of the summer crud--you know, the flu / cold that won't kill you--just make you damn miserable. And its summer in Minnesota--the brief interlude of green joy that reminds us why we put up with 6-month winters. Reason #1 why folks in north get so much accomplished--winter is so miserable that hard work is an improvement. So we get really lazy in summer.
The biggest deficit may be the USA's failure of imagination.
America Cowed: Are We Too Frightened to Forge Our Future?
Robert L. Borosage
President of the Institute for America’s Future
Posted: June 23, 2010 10:26 AM
Americans have grown fearful. Most believe, not surprisingly, that the country is headed in the wrong direction. For the first time ever, most Americans believe their children may not fare as well as they have. We spend nearly as much as the rest of the world combined on our military, chasing phantoms across the world. Conservatives in both parties rail about debt and deficits. They line up to support adding another $33 billion in emergency spending for the misbegotten war in Afghanistan, while blocking the $23 billion needed to forestall the layoff of a staggering 275,000 teachers across the country.
Washington is crazed about debt and deficits, but the real deficit is in fortitude, not finances. Consider the contrast between this country emerging from the Great Depression and World War II and now.
Then our debt was a far greater burden than now -- over 120% of GDP. The country had suffered a decade long Great Depression and a global war. The troops were coming home, but the entire economy was mobilized for war. Europe and Japan were devastated. And America was led by Harry S. Truman, a former haberdasher, product of the corrupt Pendergast machine in Kansas City.
But, having won the War, America had the confidence to face its future. Despite the massive debt, Congress passed the GI Bill, educating a generation of veterans. We financed the transformation of military factories to civilian production, investing in the industries -- from aerospace to automobiles -- that would transform the country. Congress passed subsidies to aid the purchase of homes, stimulating the growth of the suburbs. We passed the Marshall Plan to spur the rebuilding of Europe. A Republican President, Dwight D. Eisenhower, a hero of the war, put a lid on military spending, while building the interstate highway system. more
Well, I have thought so for a long time. The possibility of a sustainable future is what caused me to write Elegant Technology. But by 1985 when I had become reasonably certain that a planet powered by its solar income was quite possible as an engineering matter, I also became certain that a capitalism organized by liars and thieves could not nor would not finance such a project.
So I quite happy that two very serious young men wrote a piece entitled A Plan for a Sustainable Future. How to get all energy from wind, water and solar power by 2030 It first appeared in the November 2009 Scientific American and is available in a nice .pdf from the Stanford University web site. The guys who wrote are identified as follows:
Mark Z. Jacobson is professor of civil and environmental engineering at Stanford University and director of the Atmosphere/Energy Program there. He develops computer models to study the effects of energy technologies and their emissions on climate and air pollution.
Mark A. Delucchi is a research scientist at the Institute of Transportation Studies at the University of California, Davis. He focuses on energy, environmental and economic analyses of advanced, sustainable transportation fuels, vehicles and systems.
I highly recommend this piece with a few provisos. These are academics, not folks who have built things. I believe they are grotesquely underestimating what their project will cost and how long it will take to get it working properly. And because they are lowballing the costs for whatever reasons, I think they will ultimately undermine the credibility of their findings. I think its time for folks who talk about building a sustainable future to stand up and say as loudly as possible--this project will be VERY difficult, it will be hideously expensive, and it will require years of hard work.
But hey, Jacobson was interviewed for the Financial Times so maybe lowballing is not SUCH a bad idea. (sigh)
Q&A: Mark Jacobson on 100% renewable energy
May 12, 2010 2:01pm
by Kate Mackenzie
Mark Jacobson, a Stanford professor of engineering, has drawn a lot of attention with the article he wrote together with Mark Delucchi for Scientific American last year, about how the world could move to 100 per cent renewable power.
He spoke to FT Energy Source about the political, financial and other barriers to a mass transition to renewable power — and whether there is a role for carbon pricing.
Jacobson and Delucchi’s outline focuses on wind and solar — supplemented by smaller amounts of geothermal and marine energy. It’s not the first to look at making a big switch to low-carbon energy; a recent study co-authored by McKinsey for example found the cost of Europe reducing CO2 emissions by 80 per cent would cost no more than business-as-usual; while a paper by PriceWaterhouseCoopers on100 per cent renewables for Europe and North Africa was also reasonably optimistic on costs. German physicist Gregor Czisch is an early advocate of 100 per cent renewables. more
A German project using French technology--what could go wrong? Actually, quite a bit.
Offshore Embarrassment
Shoddy Parts Trip Up Major North Sea Wind Farm
Unforeseen problems at the Alpha Ventus wind farm have lukewarm investors reevaluating the billions of euros they have invested in offshore wind energy.
Germany's first offshore wind park was dealt a blow with the failure of two turbines due to inferior materials. The rough patch has energy executives scurrying to reassure Berlin and banks scrutinizing their billions in offshore wind energy investments.
Less than two months after celebrating its opening, the Alpha Ventus test wind park in the North Sea is already running into problems. Intended to be the initial thrust in a plan that foresees dozens of new offshore wind parks off the German coast, shoddy building materials have caused two turbines to overheat and fail. An additional four turbines will need to be replaced.
Each of the struggling turbines was manufactured by the French firm Areva, which is responsible for half of the 12 turbines in the four-square-kilometer park (1.5 square miles), located about 45 kilometers (28 miles) north of the island of Borkum.
Areva said Friday that overheating was unforeseen and "not sufficiently considered" from the outset. As a result, the company will invest in a facility in Bremerhaven to test its turbines under full-load capacity before sending them out to sea.
The turbines, which had only been in operation for eight months, will be replaced by late summer, according to Areva. more
I am certain the Norwegians are not the only folks object to these self-appointed masters of the universe--but they are probably the richest.
Norway Takes Aim at G-20
'One of the Greatest Setbacks Since World War II'
06/22/2010
Norway's foreign minister has described the group of the 20 most important industrialized and developing nations, which will meet this weekend in Toronto, as the "greatest setback" for the international community since World War II. In an interview with SPIEGEL ONLINE, Jonas Gahr Støre explains why the organization won't function in the long run.
SPIEGEL: Mr. Foreign Minister, this week the most important industrial and developing nations will meet at the G-20 summit in Toronto. You oppose the organization. Is that because Norway, which is one of Europe's richest countries, is not a part of it?
Jonas Gahr Støre: No. The G-20 had a meaning when the financial crisis broke out, the situation was serious and swift joint decisions had to be made in order to calm the markets. This importance remains. But the G-20 is a grouping without international legitimacy -- it has no mandate and it is unclear which functions it actually has. more
I must confess my fondness for things British disappeared a long time ago. But I most certainly WAS a full-blown Anglophile at one time—Harris Tweed jackets, the willingness to quote Shakespearian sonnets in mostly vain attempts at impressing women, and the Austin-Healy Sprite. (Mine was a yellow 1964 but otherwise similar to the one in the picture.)
It was the Sprite that put an end to the Anglophilia. One day, I was driving along about 45 mph when the rear axel just twisted off. I went to the nearest dealership to get a replacement hoping they had one. They had a whole stack of them—apparently bad axels were normal for 1964 Sprites. And when I went to replace it, I discovered the old shaft was so brittle, it disintegrated under the assault of a common screwdriver. I got rid of that car as soon as possible because brittle steel was simply the last straw. From Lucas--Prince of Darkness electrical failures to an engine on its last legs at only 30,000 miles, that car was easily the most poorly made mechanical device I have ever encountered—before or since.
I had mostly written off my encounters with that wonder of British engineering as so much youthful foolishness until I saw some articles in 1997 about the low quality of the steel used to fabricate the hull of Titanic. First were the findings about the low quality of the steel plates used to fabricate the hull. Then the rivets were examined and that nightmare was even worse.
The problems were these:
1) The builders of Titanic were in a hurry and there were not enough steel rivets available--so they used iron rivets in the bow. When Titanic stuck the iceberg, the seams created with inferior rivets just exploded.
2) The steel plates were brittle because of a metallurgical problem of most British steel--too many impurities. The Brits never really did get their arms around this problem. By the time their metallurgists figured out a way to make better steel in the late 1970s, the industry was mostly dead.
AHA! The shitty steel that sank Titanic was the same crap that twisted off on the rear end of my Sprite. Brit metallurgy hadn't progressed much between 1912 and 1964. And the practice of knowingly using substandard materials was still alive and well. These problems would eventually destroy the very industry the Brits invented--underinvestment in critical areas like metallurgical research, and cutting corners--especially in areas that are not immediately visible to the public.
And lest one think the Brits have learned ANYTHING since 1964, we are now beginning to see the corner-cutting at British Petroleum. If there is ONE lesson to be drawn from the tragedy in the Gulf it is: NEVER use the Brits as a model for industrial organization.
Congress Confirms WSJ’s Story on BP’s Corner-Cutting
By Ryan Chittum
The Audit (Columbia Journalism Review) — June 15, 2010 11:38 AM
The evidence keeps stacking up that BP cut all kinds of corners to save time and money at the expense of safety while drilling the Deepwater Horizon well.
The Wall Street Journal goes A1 with congressional confirmation of its excellent BP storyfrom three weeks ago.
In one case, BP engineers decided on April 16 to use just six so-called “centralizers” to stabilize the well before cementing it, instead of 21 as recommended by contractor Halliburton Corp. according to BP internal emails made public by the panel.
In their letter, the lawmakers say that BP’s well team leader, John Guide, “raised objections to the use of the additional centralizers” in an April 16 email released by the panel. “It will take 10 hrs to install them…I do not like this,” Mr. Guide wrote.
The lawmakers cited another BP email as an indication that “Mr. Guide’s perspective prevailed.” A BP official wrote in an April 16 email: “Who cares, it’s done, end of story, will probably be fine.”
Ten hours. “Will probably be fine.” Good luck in court, guys! more
Will be long and VERY difficult. But it must be fought and it must start someplace. Here?
Lilliputians Rise Up Against Banking Overlords
By: Cynthia Kouril Friday June 18, 2010 12:25 pm
American Banker has an article out that is a must read. It is chock a block with so much information that I could not relay it all to you and still stay within the bounds of Fair Use. Some of the highlights:
1) “In February, the Florida state Supreme Court set a new standard stipulating that before foreclosing, a lender had to verify it had all the proper documents. Lenders that cannot produce such papers can be fined for perjury, the court said.”
2) The Florida Attorney General has opened an investigation into ”whether Docx, an Alpharetta, Ga., unit of Lender Processing Services, forged documents so foreclosures could be processed more quickly.” Docx and Lender Processing services are document mills, ahem, I mean, mortgage servicers.
3) “Lender Processing Services disclosed in its annual report in February that federal prosecutors were reviewing the business processes of Docx.”
4) Judge J. Michael Traynor, “a state judge in Florida ordered a hearing to determine whether M&T Bank Corp. should be charged with fraud after it changed the assignment of a mortgage note for one borrower three separate times.” [emphasis added].
5) “In Florida, Georgia, Maryland and other states where the foreclosure process must be handled through the courts, hundreds of borrowers have challenged lenders’ rights to take their homes.”
Firepups, we’ve been waiting for the villagers to take to the streets with torches and pitchforks. Instead they have taken to the courts with legal defenses and counterclaims. They are rising up against their banking overlords. more
And the days of freaky-cheap manufactured goods may be behind us. I'll bet they find the next stage of their industrialization is a LOT harder than luring runaway factories.
Strikes in China signal end to era of low-cost labour and cheap exports
China's rulers make statements supporting workers rights as series of high-profile strikes suggest economic turning point
Jonathan Watts in Beijing
guardian.co.uk, Thursday 17 June 2010 18.50 BST
The Chinese Communist party called on employers to raise salaries and improve training for workers today, as Toyota became the latest foreign firm to be hit by a wave of high-profile strikes.
The People's Daily, the mouthpiece of the ruling party, warned that the country's manufacturing model faced a turning point as demographic and social changes slowed the influx of low-cost labour from the countryside.
Coming a day after the premier, Wen Jiabao, made similar comments, the editorial suggests the authorities may be encouraging businesses to restructure the economy by putting less emphasis on cheap exports and more on higher-value goods and domestic consumption.
For most of the past 30 years, China's economic growth has been fuelled by low-cost migrant labour. This has helped raise national competitiveness, attract foreign investors and keep consumer prices lower across the world. But members of a new generation of migrants are less willing to endure hardship and many have successfully gone on strike to demand better conditions. more
German blog ACEMAXX (via Paul Kedrosky) has posted an excellent interview with Nomura economist Richard Koo, profiling the what makes this recession different, namely, the balance sheet:
Q: Your book respectively your “Balance Sheet Recession” concept has been the talk of the town in 2009, as the global economy was in the middle of a severe contraction. Stimulus packages around the world however prevented the global economy to slip into a depression. Some economist and politicians are now asking to scale down the stimulus, as if a recovery may have started. Do you agree?
A: Not until private sector deleveraging is over. At present, private sectors in the US, UK, Spain, Portugal, and Italy are still deleveraging. This means these countries should not try to reduce fiscal stimulus. Any attempt to cut deficit in these countries is likely to result in a weaker economy and a larger deficit as seen in Japan in 1997. more
Source: Presentation to the Institute for New Economic Thinking
Source: Presentation to the Institute for New Economic Thinking
Source: Presentation to the Institute for New Economic Thinking
Source: Presentation to the Institute for New Economic Thinking
Source: Presentation to the Institute for New Economic Thinking
Source: Presentation to the Institute for New Economic Thinking
Source: Presentation to the Institute for New Economic Thinking
So now the reason is lithium. And while I am sure the world will be able to use all the lithium it can find, this is a bit much. One of the problems the Predator classes have is that they are running out of novel lies. Btw, this is from a very conservative German publication (Spiegel)
'Sensational Find'
Are Claims of Afghan Mineral Wealth a PR Trick?
The announcement of huge mineral deposits in Afghanistan was a coup for both the US and the Afghan governments. But there are doubts about how realistic the estimates are, to what extent they can be developed commercially and, above all, whether mining companies will accept the security risks.
Was the "sensational find" of large natural mineral resources in Afghanistan reportedby the New York Times last week a PR trick by the United States government? Or was it a clever chess move by Afghan Mining Minister Waheedullah Shahrani?
Both had good reason to announce the surprising news. US President Barack Obama is lobbying Congress for a further $33 billion for the military mission in Afghanistan, so the reference to Afghanistan's "stunning potential," as General David Petraeus, the head of US Central Command, put it, comes at a highly convenient time.
Shahrani had some time ago scheduled a meeting with around 200 foreign investors in London for this coming Friday to receive bids for the development of Afghan deposits. But most of the finds reported by the Americans have been known for decades.
The main news is that the deposits are significantly greater than had been thought to date. Shahrani last Thursday exceeded the Americans' claims, saying he thought their estimates were too conservative and trippling the value of the mineral deposits to $3 trillion. more
Economic debates ARE important--which is why the Predators hire so many economist to fool people into supporting policies that directly counter their own interests.
When I studied economics at the University of Minnesota, the department was crawling with Keynesians. When I identify myself as a "follower" of Keynes, it is the Keynes who died trying to reform Bretton Woods--not the Keynes of the General Theory. Here's a good essay that partly explains why I decided it was necessary to move beyond Keynes into the world of the Institutionalists when I wrote Elegant Technology.
It’s Not the 1930s!
Friday, 06/18/2010 - 10:34 am by Joe Costello
While many are looking back to Keynesian theories, we should be coming up with some that fit our own times. (AMEN!)
Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back. I am sure that the power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas. Not, indeed, immediately, but after a certain interval; for in the field of economic and political philosophy there are not many who are influenced by new theories after they are twenty-five or thirty years of age, so that the ideas which civil servants and politicians and even agitators apply to current events are not likely to be the newest. But, soon or late, it is ideas, not vested interests, which are dangerous for good or evil. — John Maynard Keynes
As “old” Europe totters on the brink of insolvency, the dead thinking of our modern economic scholastics pervades the political atmosphere to both a degree and detriment as thick and stifling as the Gulf oil slick. The classical school of our economic scholastics states, “If you’re insolvent, you must cut spending. You must pay the piper.” They are answered from the other side of the cathedral by the self-proclaimed followers of Mr. Keynes, the great classical economic heretic, who scream, “No, the way out of insolvency is to spend more, the government will insure all debt.” Neither side seems aware the vaults of the roof of their great cathedral rain down on their heads and the walls crumble. Their beliefs and dogmas from the 19th and 20th centuries offer little practical guidance for the world of the 21st. Unfortunately, that doesn’t stop them from fouling the collective political nous, influencing our own generation of madmen in authority.
From almost the beginning, the greatest problem of economics has been its craving for legitimacy as a science, instead of as a system of political values. Birthed at the end of the Enlightenment, when it was in extreme bad taste to found systems of power based on theology, economics looked to science — which again and again has proved as problematic as any theology for rationalizing systems of power. The classical economics of the 19th century, most specifically the doctrine of laissez-faire, came directly out of the Enlightenment, a continuation of the loosening of the shackles of feudal society begun several centuries before with the Renaissance. At the end of the 18th and beginning of the 19th centuries, the political economy bonds of feudalism remained substantial across Europe. So, as industrial society began to flourish, a doctrine of laissez-faire, of keeping the state away, was logical. Although in reality, as Polanyi clearly documents in The Great Transformation, the state actually played an integral role helping institute the industrial era, and contrary to zealous belief, promoting the doctrine of laissez-faire itself. more
Whether or not you like Costner's films, the fact that he spent $20 million of his own money to perfect an invention makes the man special and unique. Have no idea if this device works but when you think about it, separating oil from water shouldn't be SO difficult.
Gulf oil spill: Kevin Costner signs contract with BP for oil slick clean-up
Movie star has developed a 'dream machine' that will separate oil from water to combat Deepwater Horizon spill
Robin McKie
The Observer, Sunday 20 June 2010
Hollywood star Kevin Costner yesterday unveiled the "dream machine" that he says will separate oil from water and save the Gulf of Mexico from the environmental catastrophe caused by the destruction of the oil rig.
Costner's company, Ocean Therapy Solutions, signed a contract with BP last week to provide 32 units. These are expected to be working in the Gulf within the next 60 days, said BP's chief operating officer, Doug Suttles. Financial details of the deal between Costner and BP have not been disclosed.
"At its core, my dream, this machine, was designed to give us a fighting chance to fight back the oil that has got us by the throat," Costner told reporters at a press conference in Port Fourchon, an oil industry supply port in southern Louisiana. more
The way we run our monetary system--regular recessions / depressions are mathematically certain. Ellen explains magnifcently.
Is the US Next?
Deficit Terrorists Strike England
By ELLEN BROWN
The financial sector has sometimes been accused of shrinking the money supply intentionally, in order to increase the demand for its own products. Bankers are in the debt business, and if governments are allowed to create enough money to keep themselves and their constituents out of debt, lenders will be out of business. The central banks charged with maintaining the banking business therefore insist on a “stable currency” at all costs, even if it means slashing services, laying off workers, and soaring debt and interest burdens. For the financial business to continue to boom, governments must not be allowed to create money themselves, either by printing it outright or by borrowing it into existence from their own government-owned banks.
Today this financial goal has largely been achieved. In most countries, 95% or more of the money supply is created by banks as loans (or “credit”). The small portion issued by the government is usually created just to replace lost or worn out bills or coins, not to fund new government programs. Early in the twentieth century, about 30% of the British currency was issued by the government as pounds sterling or coins, versus only about 3% today. In the U.S., only coins are now issued by the government. Dollar bills (Federal Reserve Notes) are issued by the Federal Reserve, which is privately owned by a consortium of banks.
Banks advance the principal but not the interest necessary to pay off their loans; and since bank loans are now virtually the only source of new money in the economy, the interest can only come from additional debt. For the banks, that means business continues to boom; while for the rest of the economy, it means cutbacks, belt-tightening and austerity. Since more must always be paid back than was advanced as credit, however, the system is inherently unstable. When the debt bubble becomes too large to be sustained, a recession or depression is precipitated, wiping out a major portion of the debt and allowing the whole process to begin again. This is called the “business cycle,” and it causes markets to vacillate wildly, allowing the monied interests that triggered the cycle to pick up real estate and other assets very cheaply on the down-swing. more
The crack crew at the Daily Show finds clips of eight different presidents promising the same thing--energy independence. Of course, they all failed miserably and do you know why? Because they had NO / ZERO idea of how serious the problem was.
We have been down this road before. Unfortunately.
When Fools Rush In: 1937 Revisited
Tuesday, 06/15/2010 - 3:16 pm by Robert Johnson
History repeating itself? Larry Elliot, economic editor at The Guardian, reminds us that on the question of the deficit, “Roosevelt heeded the same sort of warnings we are hearing today - a big mistake.” He goes on:
The Germans are doing it. The Greeks, the Spanish and the Portuguese believe they have no choice but to do it. George Osborne believes it is his patriotic duty to do it. Around the world, cutting budget deficits has become the priority for policymakers fearful that rising debt levels will leave them at the mercy of capricious financial markets.
Mervyn King has applauded the return of fiscal conservatism. So has the Organisation for Economic Co-operation and Development. Two months after they urged that budgetary support be maintained until recovery was fully entrenched, finance ministers and central bank governors from the G20 said they welcomed the plans announced by some countries to begin deficit cutting without delay.
Budget deficits are certainly high across the G20 and beyond. But they are high primarily because of the severity of the worst recession since the second world war and because of the action taken collectively by governments to prevent that recession turning into something far, far worse.
As things stand, a second Great Depression has been averted, but growth has ranged from the weak in Europe to the unspectacular in the United States. Banks are not lending. Unemployment is running at near double-digit levels in the US and the eurozone. The determination to cut budget deficits in these circumstances does not show that policymakers of probity and integrity have replaced the irresponsible spendthrifts of 2008 and 2009. It shows that the lunatics are back in charge of the asylum. more
And for those of us who have been screaming in every fashion we know since the days of Reagan, some charts that validate our rage.
Reagan Revolution Home To Roost - In Charts
Dave Johnson
June 15, 2010 - 1:50pm
This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
It seems that you can look at a chart of almost anything and right around 1981 or soon after you'll see the chart make a sharp change in direction, and probably not in a good way. And I really do mean almost anything, from economics to trade to infrastructure to ... well almost anything. I spent some time looking for charts of things, and here are just a few examples. In each of the charts below look for the year 1981, when Reagan took office.
Conservative policies transformed the United States from the largest creditornation to the largest debtor nation in just a few years, and it has only gotten worse since then:
Working people's share of the benefits from increased productivity took a sudden turn down:
This resulted in intense concentration of wealth at the top:
I am ambivalent about the operations of the oil companies. Because finding and refining oil is insanely difficult, the oil industry probably has a higher percentage of educated staff than perhaps the medical industry. From state of the art computer mapping to the furthest-flung reaches of organic chemistry, the oil industry is just crawling with Ph.D.s who can absolutely astonish you with their feats of industrial genius.
On the other hand, the oil business is also crawling with predator crooks who will stop at nothing to feed their unbridled greed. Think Dick Cheney.
And while you read these essays remember that as a country, USA consumes a tanker-truck full of liquid fuels every SECOND. So while few of us are responsible for the Dick Cheneys of the world and would like the oil business run by more ethical people, there is still the matter of 3600 tanker trucks of oil products being burned every hour. And that folks is the reason why the Dick Cheneys are allowed to live.
Big Oil’s Predations are not Your Fault
Posted on June 15, 2010 by Juan Cole
No, the BP oil volcano in the Gulf of Mexico is not your fault, despite what many pundits will tell you. Back in the 1960s when the environmental movement got going, major US corporations responsible for much of the nation’s pollution decided to fight it by paying for television advertising that urged individuals not to litter, thus implying that pollution is produced by anarchic individuals rather than by organized businesses. It was a crock then and it is a crock now.
You did not demand that BP consistently cut safety corners more than any other petroleum company, thus resulting in the Deepwater Horizon calamity, which could end up costing the economy of the Gulf of Mexico literally hundreds of billions of dollars this year.
How much the Gulf oil catastrophe is not your fault can more clearly be seen if we consider the ways in which a BP refinery in Indiana is threatening the Great Lakes with excess pollution.
The BP refinery received permission from the Indiana legislature to increase its ammonia and silt (infested with toxic heavy metals) output into the Lakes. The increased pollution was part of an expansion of the refinery to allow it to process Canadian tar sands. In addition, BP has illegally spewed extra benzene into the lakes (benzene is a known cause of leukemia) and has also repeatedly broken the law with regard to air pollution standards. more
Now you don't trust BP, but it's too late
BY CARL HIAASEN
Every time a BP executive appears on television, I think of the garage scene from the movie Animal House.
An expensive car belonging to Flounder's brother has just been trashed on a drunken road trip, and the smooth-talking Otter comforts the distraught Delta pledge with these cheery words:
"You f----- up! You trusted us! Hey, make the best of it.''
If only the BP guys were half as honest.
Incredibly, almost eight weeks after the Deepwater Horizon oil rig exploded in the Gulf of Mexico, the company that caused the disaster remains the primary source of information about it.
Predictably, much of that information has been stupendously, tragically wrong, starting with the low-ball estimates of how much crude was leaking into the sea.
BP didn't know the answer when the rig went down, and it doesn't know the answer now. Nobody does.
Every day we see streaming underwater video of that mile-deep gout of oil, billowing and unstaunched. The image is only slightly less sickening than the pictures of dead sea turtles and gagging pelicans.
Some people I know can't bear to watch anymore, so painful are the feelings of helplessness and frustration. What's happening before our eyes is the slow murder of one of the world's most bountiful bodies of water, a crime precipitated by reckless corporate decisions and abetted by our own government.
Imagine a so-called regulatory process that allows oil companies to sink a drill 5,000 feet or even 10,000 feet through a living ocean without any reliable backup for when a blowout preventer fails to prevent a blowout.
Duh, let's build us a big ol' steel dome and drop it on the leak.
If that don't work, we'll blast us some golf balls and shredded tires into the hole.
Or maybe a giant sody straw might do the trick!
Obviously these boneheads didn't have a workable Plan B. Worse, nobody in government figured that out until it was too late. more
The Spill, The Scandal and the President
The inside story of how Obama failed to crack down on the corruption of the Bush years – and let the world's most dangerous oil company get away with murder
McNamee/Getty
By Tim Dickinson
Jun 08, 2010 4:30 PM EDT
This article originally appeared in RS 1107 from June 24, 2010.
On May 27th, more than a month into the worst environmental disaster in U.S. history, Barack Obama strode to the podium in the East Room of the White House. For weeks, the administration had been insisting that BP alone was to blame for the catastrophic oil spill in the Gulf – and the ongoing failure to stop the massive leak. "They have the technical expertise to plug the hole," White House spokesman Robert Gibbs had said only six days earlier. "It is their responsibility." The president, Gibbs added, lacked the authority to play anything more than a supervisory role – a curious line of argument from an administration that has reserved the right to assassinate American citizens abroad and has nationalized much of the auto industry. "If BP is not accomplishing the task, can you just federalize it?" a reporter asked. "No," Gibbs replied.
Now, however, the president was suddenly standing up to take command of the cleanup effort. "In case you were wondering who's responsible," Obama told the nation, "I take responsibility." Sounding chastened, he acknowledged that his administration had failed to adequately reform the Minerals Management Service, the scandal-ridden federal agency that for years had essentially allowed the oil industry to self-regulate. "There wasn't sufficient urgency," the president said. "Absolutely I take responsibility for that." He also admitted that he had been too credulous of the oil giants: "I was wrong in my belief that the oil companies had their act together when it came to worst-case scenarios." He unveiled a presidential commission to investigate the disaster, discussed the resignation of the head of MMS, and extended a moratorium on new deepwater drilling. "The buck," he reiterated the next day on the sullied Louisiana coastline, "stops with me."
Meet Obama's sheriff, Ken Salazar.
What didn't stop was the gusher. Hours before the president's press conference, an ominous plume of oil six miles wide and 22 miles long was discovered snaking its way toward Mobile Bay from BP's wellhead next to the wreckage of its Deepwater Horizon rig. Admiral Thad Allen, the U.S. commander overseeing the cleanup, framed the spill explicitly as an invasion: "The enemy is coming ashore," he said. Louisiana beaches were assaulted by blobs of oil that began to seep beneath the sand; acres of marshland at the "Bird's Foot," where the Mississippi meets the Gulf, were befouled by shit-brown crude – a death sentence for wetlands that serve as the cradle for much of the region's vital marine life. By the time Obama spoke, it was increasingly evident that this was not merely an ecological disaster. It was the most devastating assault on American soil since 9/11. more
The Sierra Club isn't alone here. They are just such a sterling example of everything wrong with American environmentalism--technologically illiterate, dedicated first to the survival of their little bureaucracies, totally without a meaningful program that would address real environmental problems, superb at public relations--the Sierra Club magazine is beautiful, etc. In short, a USA environmentalist is someone who will show up at somewhere like Kyoto with really nifty Powerpoint slides about how "cap and trade" and other market-style "solutions" can address something as serious as climate change. (sigh)
Why The Sierra Club No Longer Deserves Your Trust
Jane Hamsher
Founder, FireDogLake.com
Posted: June 14, 2010 01:52 PM
There has been a massive silence on the part of the major environmental groups in the wake of the BP oil catastrophe, ever since the rig collapsed.
But it went into overdrive last week when many of those groups took out an ad in the Washington Post, not to criticize the government's response, but to praise the president for putting a hold on a drilling project in Alaska:
"President Obama is the best environmental president we've had since Teddy Roosevelt," Sierra Clubchairman Carl Pope told the Bangor Daily News last week. "He obviously did not take the crisis in the Minerals Management Service adequately seriously, that's clear. But his agencies have done a phenomenally good job."
If they aren't saying anything negative, it's because they believe there's nothing to criticize:
Asked if Sierra Club has any concerns about the administration's response to the spill, [Sierra Club's Dave] Willett said, "Overall, we're satisfied with the cleanup and recovery effort." more
I believe that is giving Obama WAY too much credit. At least Carter understood the science of the energy problems--Obama is a long way from THAT.
Will Obama Be the 'Jimmy Carter of the 21st Century'?
Can US President Barack Obama lead America away from fossil fuel dependency? German commentators don't think so. Some say he is in danger of turning into an idealistic, one-term president like Jimmy Carter.
US President Barack Obama's address from the Oval Office on Tuesday was supposed to be a moment of leadership during the worst environmental disaster in American history. But critics from across the political spectrum wondered afterwards whether he'd shown leadership at all. The geyser of oil in the Gulf of Mexico seems, technologically, to lie beyond anything either BP or the US government was prepared for, and Obama failed to mention any specific new ideas.
"The tragedy unfolding on our coast is the most painful and powerful reminder yet that the time to embrace a clean-energy future is now," he declared, without offering policy details. Of course, it wasn't a policy speech. But the fact that Obama failed to outline a clear path toward this clean-energy future seems to have disappointed a lot of people. "He didn't boldly push an agenda," said Sen. Lindsey Graham, a Republican senator from South Carolina, to Politico, the Washington-based news website. "I think a lot of people took that to mean lukewarm support for anything big."
One immediate result of White House talks with the American arm of BP, though, was a series of concessions on Wednesday. BP Plc agreed to set aside $20 billion (€16.1 billion) in escrow to cover damage claims by shrimpers, restauranteurs and other Gulf-Coast residents hurt by the spill. The energy giant also said it would suspend shareholder dividends until 2011, when it expects to have a clearer notion of the catastrophe's costs. Another $100 million (€80.8 million) will be set aside for compensation to BP workers hurt by the spill. more
Every four years, I TRY to become a soccer / futbol fan. There is something very appealing about an event that the whole world can get excited about.
And honestly, I am something of a sports fan even though this is something of a no-no for those of us who are well-read and sport intellectual pretensions. My favorite historical intellectual Thorstein Veblen listed sport as one of the approved occupations of the Leisure Class believing that sport was the preferred method they used to teach the arts of force and fraud to their children and once wrote "football is to physical culture what bullfighting is to agriculture."
Yes Veblen, you were probably correct in your analysis of the role sport plays in a culture but that does not negate the fact that sport can be exciting, graceful, and aesthetically quite wonderful. My favorite sport, ice hockey, is played on a sheet of white ice by players in colorful uniforms who rocket around at speeds approaching 30 mph / 50 kph. Anyone who lives with long dark winters is probably susceptible to a spectacle involving so much light, color, grace, and speed. I will also watch USA football and basketball mostly because I appreciate the difficulty associated with large men doing anything so complex and difficult with style. Baseball, I loathe with a passion because the idea of watching seven guys scratching themselves while two guys play a one-sided game of catch lost its appeal about seventh grade.
In spite of some serious attempts to appreciate it, futbol / soccer has never quite caught on with me. I don't have a lot of difficulty understanding what's going on because it is a lot like ice hockey except played in extremely slow motion with a nice big ball. Yet even though it requires exceptional skill to play a game with one of the least graceful parts of the human anatomy, I keep wondering why anyone would actually want to do this. Yes I understand the idea of giving the weak part of any performance skill extra training--sort of like left-hand exercises given to right-handed piano students--yet no one actually performs left-hand exercises in concert. And while futbol is undoubtably a marvelous training exercise (and playing it certainly makes for better ice hockey players) it just looks strange as a spectator sport. I keep wondering when a PETA-style group formed for the protection of the interests of the human handicapped will mount a protest of futbol because it makes fun of people who have lost their arms.
Football: a dear friend to capitalism
The World Cup is another setback to any radical change. The opium of the people is now football
Terry Eagleton guardian.co.uk, Tuesday 15 June 2010 21.00 BST
If the Cameron government is bad news for those seeking radical change, the World Cup is even worse. It reminds us of what is still likely to hold back such change long after the coalition is dead. If every rightwing thinktank came up with a scheme to distract the populace from political injustice and compensate them for lives of hard labour, the solution in each case would be the same: football. No finer way of resolving the problems of capitalism has been dreamed up, bar socialism. And in the tussle between them, football is several light years ahead.
Modern societies deny men and women the experience of solidarity, which football provides to the point of collective delirium. Most car mechanics and shop assistants feel shut out by high culture; but once a week they bear witness to displays of sublime artistry by men for whom the word genius is sometimes no mere hype. Like a jazz band or drama company, football blends dazzling individual talent with selfless teamwork, thus solving a problem over which sociologists have long agonised. Co-operation and competition are cunningly balanced. Blind loyalty and internecine rivalry gratify some of our most powerful evolutionary instincts.
I attended an informal seminar last night about the state of alternative (solar) energy in Minnesota. And while we do lead the nation in installed wind power, it is still a tiny sliver of the energy picture which is about 50% coal-fired and 20% nuclear. The speakers included a guy from the renewables (wind) department of Xcel energy, a guy representing the wind industry, and someone who believes the state is just waiting for more needed photovoltaic installations.
If this gathering had happened in 1979, I would have been impressed and happy. But in 2010, it was just another depressing reminder of how profoundly unserious we are in USA about solving our thunderingly obvious energy problems. There was almost no discussion of how other countries were easing their way out of the Age of Petroleum. There was NO discussion of how such a goal could be accomplished without a national industrial policy. And of course, there was no discussions about how much this energy conversion would cost and the financial reforms necessary to pay for such a project.
It was like listening to a bunch of concerned but otherwise ignorant teenagers. I asked a couple of participants whether they thought accurate the IEA's estimate that reducing carbon emissions by 50% would cost about $45 TRILLION. They were in deep denial. Anyway, here's what I wrote when the IEA study was released in 2008.
The Economic Benefits of Addressing Climate Change
The report by the Paris-based International Energy Agency envisions a "energy revolution" that would greatly reduce the world's dependence on fossil fuels while maintaining steady economic growth.
"Meeting this target of 50 percent cut in emissions represents a formidable challenge, and we would require immediate policy action and technological transition on an unprecedented scale," IEA Executive Director Nobuo Tanaka said.
-------------------------------
The scenario for deeper cuts would require massive investment in energy technology development and deployment, a wide-ranging campaign to dramatically increase energy efficiency, and a wholesale shift to renewable sources of energy.
Assuming an average 3.3 percent global economic growth over the 2010-2050 period, governments and the private sector would have to make additional investments of $45 trillion in energy, or 1.1 percent of the world's gross domestic product, the report said.
When I wrote Elegant Technology in the late 1980s, the organizing theme was that job #1 was to use our natural energy capital (fossil fuels) to build a society that could run on the energy income we could harvest from the sun. I discussed class theory, tool development, industrial conversion of militarized production, and especially political economy. Everything—social organization, education, finance, political institutions, and other cultural manifestations had to be harnessed in such an effort—so important was this project.
Of course, if humanity is going to attempt to completely rebuild the industrial umbilical chord that sustains our lives, we might was well take care of the other problems of early-stage industrialization—toxic waste, resource depletion, mining the soil for crops, WATER, etc. etc. No shortage of scope on this project! (Elegant Technology was about 110,000 words long and I thought I was coming to the point!) more
