Old Hickory's Weblog

European criticism of Angie's Greek policies

2012-01-31T06:00:00.000-08:00

What happened the last few days with German Chancellor Angela Merkel's policies toward Greece is really remarkable. She proposed what can only be described as a dictator for Greece, responsible in theory to the EU but all but surely to be controlled by her. It would have given the new Gauleiter (the title for area chiefs for the Nazi Party back in the day) for Greece complete power over the Greek national budget with the restriction that repaying the sovereign debt would be the top priority over all others.

The good news is that the negative reaction from Greece and other EU members finally made Angie back off, though she was still pushing the idea on Monday. And the fiscal restrictions that the current EU summit may agree upon seem, according to the news reports, to be modified to the point that Germany won't have a routine veto over all the EU national budgets, which is what Angie actually wanted.

Yes, there are leading European politicians opposing neoliberalism: here, Austria's Laura Rudas

The Social Democratic Party (SPD) Sigmar Gabriel publicly opposed the proposal and said explicitly that such an official would be like a "dictator" who would be in a position "to abolish democracy in Greece". He went on to say, with sarcasm and surprise, that the only thing left would be to appoint a German to the position and put him in a "uniform". ("Sparkommissar" für Griechenland wäre "Diktator" Stern Online 30.01.2012)

This is encouraging to see that the major opposition party, the SPD, is still capable of opposing something like this.

But what the Hölle was going with the SPD guy Martin "Gustav Noske" Schulz who is President of the European Parliament instead endorsing Angie's Greek Gauleiter idea? That jerk must be like the Ben Nelson of German Social Democracy. They should kick him out of the SPD altogether. He would have been better off to imitate Sgt. Schulz of Hogan's Heroes and just say, "I know nothing, I see nothing!"

I was encouraged to see that Austrian Chancellor Wehner Faymann (Social Democratic, SPÖ) on his Facebook page clearly, if more diplomatically than his German colleague, criticize Angie's Greek Gauleiter scheme saying, "democratic values should not be hollowed out."

Faymann also talks about the larger eurozone problems in an English language article: Christoph Schult, Interview with Austrian Chancellor Faymann: 'Don't Overestimate the Fiscal Pact' Spiegel International 01/30/2012. Faymann supports a "debt brake" being added to the Austrian Constitution to limit the amount of debt the country can take on relative to GDP, a really bad idea in itself. But given Angie's current course, in the short run protecting Austria's national independence may require minimizing the debt burden more than sensible economic policy would otherwise allow.

Faymann favors a modified version of the idea of having the European Central Bank (ECB) act as a buyer of last resort for eurozone sovereign debt, something that would have been necessary for the eurozone to continue functioning if the EU had acted sensibly enough and early enough to save it. (The last pessimistic part is my view.) The short-term effect on Austria and most EU countries is likely to be bad when the euro ends (to put it mildly!), so Faymann is understandably still trying to take the position of saving it. I certainly hope he's making plans for a quick transition back to the Austrian schilling when the time comes, though. That idea for the ECB, though, is something that Angie completely rejects.

And I'm sure the Princess Angie von Merkel wouldn't be pleased to hear him be realistically modest about the likely benefits of the fiscal pact that is the supposedly big accomplishment she wants to see come out of the current summit: "one shouldn't overestimate the fiscal pact. Because of the narrow corset created by the Lisbon Treaty, one can't claim that we're reinventing the euro zone." And, of course, reinventing the eurozone - and fast - would be what it would require to save the euro.

And Faymann won back some credibility in my mind with this exchange:

SPIEGEL: With this Social Democratic agenda, you are rather in the minority among the EU's state and government leaders.

Faymann: Actually this agenda should be consistent with Christian Democratic or Christian Socialist values. I see the biggest difference with the neo-liberals.

SPIEGEL: In Davos Chancellor Merkel said that stricter rules are needed in Europe. It sounds more like a punishment than solidarity.

Faymann: Rules aren't positive or negative, it's about the content. I would welcome it if we regulated the financial markets more strictly, cut down on speculation and founded a European ratings agency. Yes, our high debts make us vulnerable, but speculators have intensified the crisis. Therefore, in the form of the transaction tax, they should also be involved in overcoming the crisis. [my emphasis]

He also makes what is an important point to keep in mind with this whole euro business. Everyone has had a few months now to think seriously about what would happen when a country leaves the euro. (I say when, not if, because I'm a pessimist on this.) But no one has a really good idea what it will look like, in no small part because the extent of credit default swap (CDS) exposure by major financial institution is unknown to everyone, even the fabled Gnomes of Zurich. Faymann says: "All of the experts with whom I speak say they can't reliably promise an orderly insolvency. Contagion is incalculable. It would be like a real-life experiment ..."

And not a fun one.

Faymann's interview and Facebook comments make me think he sees the proverbial writing on the wall and he is expecting the proverbial s*** to hit the proverbial fan soon.

My favorite Austrian Social Democratic leader, Laura Rudas, who is one of the main figures currently trying to expand the Party's appeal to younger voters, had an even more interesting piece on her Facebook page, "Schuldenabbau als Weg zur Unabhängigkeit" ("Debt Reduction as a way to independence"). Also in Aktuell 27.01.2012. She is the co-business manager for the SPÖ. She summarizes her points in slogan form at the start:

Finanzmärkte regulieren. Finanztransaktionssteuer einführen. Bildung, Forschung und Gesundheit voranbringen. Intelligent investieren. Wirtschaftswachstum ankurbeln. Alle diese Agenden brauchen vor allem eins: Autonomie in der politischen Prioritätensetzung. Das ist nur möglich, wenn wir uns aus den Fesseln der Finanzmärkte befreien!

[Regulate the financial markets. Introduction a financial transaction tax {aka, a Tobin tax}. Improve education, research and health. Crank up economic growth. All of these agendas require above all one thing: autonomy in the setting of political priorities. That is only possible, if we free ourselves from the chains of the financial markets!]

Dang! That sounds downright Jacksonian to me!

Her article goes on to argue in explicit terms that Austria's political priorities cannot be determined by the financial markets, which of course is Angie's goal and approach. She explicitly defends taxes as necessary for retirement funds (which are basically all run through the state in Austria), education, the health care system and other parts of what we call the social safety net in the US. And she calls for progressive tax increases to achieve agreed-upon debt limits.

She also criticize Austrian banks for implicating themselves in poor risk bets in eastern Europe.

Politics is politics, and as a Party figure she has to defend even suboptimal policies, like new debt limits during a depression. But I'm reading what she says in the current Austrian and eurozone context. And it sounds like a strategy primarily directed at protecting Austria against (1) bond speculators and (2) Angie's Anschluss economics:

In jedem Dilemma aber gibt es meist auch Profiteure. Und so hat auch die Abhängigkeit ganzer Staaten und das damit einhergehende Zurückdrängen der Politik ihre Profiteure. Oder ist es sogar Kalkül mancher, dass diese Abhängigkeit gegeben ist? Oder auch, dass man Finanzmärkte kaum regulieren kann, wenn man in ihrer Abhängigkeit steckt?

[In every dilemma, there are also usually profiteers. And so the dependence of whole countries and the suppression of political priorities that comes with it also has profiteers. Or is it even the calculation of some, that this dependence just is so {i.e., that it should be that way}? Or also, that one can scarcely regulate the financial markets if one is stuck in dependence to them?]

In the current context, this is clearly directed against both the bond speculators and Angie's ordoliberal policies.

It's very encouraging to see the SPÖ's sounding so aware of the issue and so ready to deal with it.

Tags: angela merkel, eu, euro, european union, laura rudas, werner faymann

Angie gets pushback on her finance Gauleiter demand for Greece

2012-01-30T10:28:00.000-08:00

It's encouraging to see that German Chancellor Angela Merkel's anti-democracy proposal to appoint a financial Gauleiter to rule Greece on behalf of the EU, more particularly on behalf of Germany, and even more particularly on the behalf of private banks, is getting significant resistance from various other European leaders. For some reason, they are not really excited about the idea of such an arrangement.

This is a Spanish cartoon about sacrificing their national constitution to the Goddess Angie of the Market. But it could apply to every other country that signs onto to Angie's austerity policies, as well:

Angie's Post Democracy 2.0 proposal would be about as direct a case of letting giant banks rule the country of Greece as it would be possible to get. A pure financial dictatorship. The only way it could be more direct would be if they just designated a committee of Bank CEO's to run the country. And even then, they would probably appoint some kind of Gauleiter like Angie is recommending.

Philipp Wittrock in Debatte um Sparkommissar.Merkel besänftigt aufgebrachte Griechen Spiegel Online 30.01.2012 reports on criticism coming from leaders in Austria, Greece, Luxembourg,

Since the current Greek government is a Post Democracy 1.0 regime of debt collectors installed at the insistence of Germany and France, though with technically legitimate democratic forms, it wasn't a given that they would put up any kind of a stink about it. But I guess that was too crass even for what is already a government of debt collectors for private banks.

Even Angie's FDP coalition partner Foreign Minister Guido (Guido Westerwelle) is trying to distance himself from her Greek Gauleiter proposal. But despite Guido's public comments, Wittrock reports that Angie was still pushing the proposal on Monday!

It's remarkable to me at this stage, though, that Angie's out-of-control, destructive policies aren't getting more explicit public resistance across the board from other EU countries. No doubt, it's a reflection of the deeply corrupting and crippling effect that the neoliberal ideology of globalization (and it's well-healed backers) have had on European politics, just as it has had in America.

Jan Strupczewski and Luke Baker Report for Reuters in EU leaders struggle to reconcile austerity, growth 01/30/2012 on the summit. It's rather bizarre that an article like that one doesn't mention Angie's Greek Gauleiter proposal until far down in the article, and then only half-report it:

Germany caused outrage in Greece by proposing last week that a European commissar take control of Greek public finances to ensure it meets fiscal targets. Greek Finance Minister Evangelos Venizelos said that to make his country choose between national dignity and financial assistance ignored the lessons of history.

The German idea won cautious backing from the Dutch and Swedish prime ministers.

"We need to have things in place for monitoring that they are really doing what they are promising," Swedish Prime Minister Frederik Reinfeldt told reporters on arrival.

But Merkel played down the idea of placing Greece under stewardship, saying: "We are having a debate that we shouldn't be having. This is about how Europe can be supportive so Greece can comply, so there are targets."

You wouldn't know from that report that other countries were expressing concern and opposition to the idea. They do allude to the bad economics behind the proposal that the summit is apparently set to approve for new, more rigid austerity requirements to be written into treaty commitments, another terrible idea of Angie's that can only make the debt crisis worse:

With Britain standing aloof, most of the other 26 EU leaders were set to approve a fiscal pact to write balanced budget rules into their national law, despite economists' doubts about the wisdom of effectively outlawing deficit spending.

"To write into law a Germanic [sic] view of how one should run an economy and that essentially makes Keynesianism illegal is not something we would do," a British official said.

Outlawing Keynesian measures is exactly what Angie is seeking to do. But we also should wonder why a "British official" needed anonymity to say that, since it's straightforwardly true. And also why Reuters would grant anonymity for that. They would have little trouble finding well-known economists to tell them the same thing. Maybe it's because they thought the "Germanic" crack would make good copy but the "British official" didn't want to be quoted by name sounding like a petty nationalist.

See also: Sven Böll et al, A Bluffing Game: European Politicians in Denial as Greece Unravels Spiegel International 01/30/2012; Micheál Martin, Fiscal pact fails to address problems at root of crisis Irish Times 01/30/2012; Eurozone crisis live The Guardian.

Tags: angela merkel, eu, euro, european union, greece, post-democracy

New EU summit: the drama continues

2012-01-30T09:26:00.000-08:00

The euro crisis is starting to seem like a B-movie tragedy, where everyone can see where the plot is going but the motives are hard to fathom and it's dragging on forever.

The latest EU summit started on Monday. Angela Merkel may be Obama's biggest threat to re-election. Because if Angie keeps getting her way, it maximizes the chances that the eurozone will crack up this year and maybe take down some major banks with it, like the mortgage crisis did in 2008.

This Euronews report plays up Angie's superficial rhetoric about the need to promote growth, EU leaders shift focus from austerity to growth 01/30/2012. But Angie isn't budging from her "ordoliberal" austerity policies. Her "growth" proposals pretty much consist of more austerity and anti-labor legislation, with a few extra dollars to be kicked in to so-far-undefined growth measures from various EU funds that has surpluses at the moment. In this report, we see her stressing the need for boosting youth employment, which Angie sees as yet another chance to weaken labor laws. She apparently expects the new conservative government in Spain to lead the way on that approach to youth unemployment.

Greece is bankrupt in all but name and they still haven't tied down the "voluntary" writedowns from private holders of Greek debt that were part of the stopgap measure for Greece agreed on at the December EU summit.

Portugal is on the verge of bankruptcy, with Italy, Spain and Ireland kind of shaky. And Europe is in a new recession. Belgium just had an apparently pretty effective one-day general strike against government austerity measures there.

Angie's proposal for an EU Gauleiter to run Greece until their debts are paid down and the bond markets like them again got a pretty negative reaction once the Financial Times reported on it publicly. Even Greece's Post Democracy 1.0 government, installed at Angie's insistence to act as banks' debt collectors, to her to go blow on that one. Austria's Social Democratic Chancellor Werner Faymann, who has been pushing a foolish "debt brake" austerity proposal like the one Angie is demanding from other EU members, criticized Angie's Greek Gauleiter proposal on his Facebook page (01/30.2012), though in more diplomatic language than Angie's proposal deserved:

Die Bedingungen, die Griechenland in den kommenden Jahren zu erfüllen hat, müssen strikt bleiben. Die Einhaltung dieser Bedingungen wird von der Trojka aus Europäischer Kommission, Internationalem Währungsfonds und Europäischer Zentralbank streng überprüft, überwacht und auch eingefordert.

Griechenland kann den Staatshaushalt derzeit bekanntlich nicht über Anleihen auf dem Finanzmarkt refinanzieren. Bis dies wieder möglich ist, sind glaubwürdige und feuerfeste Hilfsprogramme der internationalen Gemeinschaft notwendig, um die Eurozone stabil zu halten. Die Stabilität des gemeinsamen Währungsraums liegt auch im Interesse Österreichs. Es ist ganz klar, die Bedingungen sind einzuhalten. Deswegen muss aber niemand beleidigt werden, deswegen dürfen nicht demokratische Werte ausgehöhlt werden.

The conditions that Greece has to fulfill in the coming years must remain strict. The observance of the conditions will be monitored by the Troika of the European Commission, the International Monetary Fund and the European Central Bank.

It is known that Greece cannot refinance its budget with loans on the financial market. Until this is once again possible, credible and fireproof assistance programs from the international community are necessary in order to keep the eurozone stable. The stability of the common currency [the euro] is also in Austria's interest. It is clear that the conditions have to be met. But that is why no one should be insulted, that is why democratic values should not be hollowed out. [my emphasis]

Faymann sounds almost as timid as a US Democrat there. But still, even in diplomatese, it's clear that he's criticizing Angie's Post-Democracy 2.0 proposal for Greece.

Austria has had some rather unpleasant experiences with German Gauleiters in the last century.

Angie's policies are making all the eurozone's problems that much worse. Heckuva job, Angie!

Tags: angela merkel, eu, euro, european union, greece, post-democracy, werner faymann

Krugman on European austerity and that German hyper-inflation thing

2012-01-29T22:46:00.000-08:00

Paul Krugman has been looking at the lengths of the current depression in Britain and Italy compared with the Great Depression. In Britain, this one has gone on longer. (The Worse-than Club 01/28/2012) In Italy, it has gone on as long.

Heinrich Brüning (1885-1970)

And he makes an important historical point about the German economy in those days. Conservatives like to claim that the "hyper-inflation" in Germany in the 1920s resulted in bringing Hitler to power. Krugman writes:

France and Germany are doing much better than in the early 1930s - but then France and Germany had terrible, deflationist policies in the early 1930s. (It was the Brüning deflation, not the Weimar inflation, that brought you-know-who to power).

With two of Europe’s big four economies doing worse than they did in the Great Depression, at least in terms of GDP — and that’s three of five if you count Spain — do you think the austerity advocates might consider that maybe, possibly, they’re on the wrong track?

Peter Gay provided a helpful chart on this subjects in The Dilemma of Democratic Socialism: Eduard Bernstein's Challenge to Marx (1952):

The hyper-inflation incident was primarily a phenomenon of 1923. This is the period about which those stories are told about a loaf of bread costing a wheelbarrow full of money or whatever. A new currency was introduced late in 1923 and inflation stabilized.

This chart of election results shows the election results in millions of votes for the NSDAP (National Socialists, Nazi Party). In 1924, the year following the hyper-inflation, the NSDAP got 0.9 million votes. That fell to 0.8 million in 1928. Then in rose dramatically to 6.4 million in 1930 and 13.7 million in July of 1932. What else might have happened between 1924 and 1930? What could it have been?

Oh, yeah, that Great Depression thing. Economic crash, soaring unemployment. And Heinrich Brüning's Chancellorship of 1930-32.

None of this implies that the hyper-inflation of the early 1920s had no lasting effect. It's just that it's hard to match the notion that hyper-inflation brought the Nazis to power with the historical record as shown in election results.

While we're on the subject, it's worth noting that the NSDAP vote dropped significantly from the July 1932 election to November 1932. It's true that Hitler came to power mostly through electoral means. But Hitler's feverish politicking that got him appointed Chancellor at the end of January 1933 was driven by his falling electoral support.

Tags: german history, hitler, paul krugman, weimar republic

EU Commission reportedly rejecting Angie's Greek Post-Democracy 2.0 plan

2012-01-28T23:16:00.000-08:00

Die Zeit is reporting that the European Commission is rejecting Angie's proposal to put Greece's budget under direct EU (i.e., German) control, with sovereign debt interest payments given first priority and Greece given no option to threaten default no matter the cost to the Greek people. (Griechenland soll souverän bleiben 28.01.2012)

Athens News reports the same opposition in Germany wants Greece to give up budget control - sources 28.01.2012. But it's not exactly a resounding rejection:

On Saturday, a European Commission representative, called on to comment on press reports referring to a document distributed at the Eurogroup, proposing that a senior eurozone official assumes control of the implementation of Greece's budget, told AMNA that "the executorial task must remain in the full jurisdiction of the Greek government, that is accountable to the country's citizens and bodies. This responsibility lies on the shoulders of the Greek government and must remain so".

This is the "ordo" in Angie "ordoliberal" doctrine. Corporations should be allowed to operate with maximum freedom from government restraint. But when their risks get them in trouble, as the European banks are now with sovereign debt, it's the job of a strong state to step in as the enforcer for the corporations for which the "free market" is failing to meet their expectations. For ordinary workers, not so much. Or not at all.

Tags: angela merkel, eu, european union, ordoliberalism, post-democracy

SPD support for Angie's Post-Democracy 2.0 plan for Greece

2012-01-28T20:03:00.000-08:00

Germany's Social Democratic Party (SPD) is fulfilling the worst stereotypes of itself.

Angie's newly-reported proposal to impose Post-Democracy 2.0 on Greece by putting them under the direct control of a budget czar responsible to the EU (read: Angie) is being criticized by the Green Party and Angie's own coalition partner, the Free Democrats (FDP), although their economic position is more reactionary than Angie's, in general. Florian Toncar, head of the FDP Bundestag caucus, is on board with draconian demands on Greek repayment: "Aber die direkte Anordnung von Sparmaßnahmen durch ausländische Vertreter, vorbei an demokratischen Institutionen des Landes, und das zehn Jahre lang - das wird nicht gehen" ("But the direct regulation of austerity measures by foreign deputies, bypassing the democratic institutions of the country, and that for ten years - that won't work"), he said. (Ralph Bollmann and Markus Wehner, Ein Sparkommissar für Griechenland? Frankfurter Allgemeine Zeitung 28.01.2012)

Sadly, the democracy-hating spirit of Gustav Noske still lives on among some in the SPD

SPD European Member of Parliament Martin Schulz, the President of the European Parliament, supported Angie's Post-Democracy 2.0 demand, showing he has about the same relationship to democratic principles as Thilo Sarrazin. Such is the moral and political corruption that neoliberalism has achieved in the SPD and too many other nominally left parties over the last 20 years. Bollman and Wehner quotes Schulz:

Zustimmend äußerte sich hingegen der Präsident des Europäischen Parlaments, der SPD-Politiker Martin Schulz. „Griechenland wird damit leben müssen, dass diejenigen, die viel Geld für die Sanierung des Landes geben, an Entscheidungen, wie es verteilt wird, maßgeblich beteiligt sind“, sagte Schulz. Das bedeute „sicher eine zeitlich begrenzte Einschränkung der Souveränität“.

[On the other hand, the President of the European Parliament, the SPD politician Martin Schulz, expressed his support. "Greece will have to live with the fact that those who give a lot of money for the rehabilitation of the country, will have a major say in decisions on how it will be used, said Schulz. That means "certain a reduction of sovereignty for a limited time."]

But Schulz isn't just acting as Angie's bitch on this. He goes on to say the EU may have a few extra coins lying around that they could toss to the Greeks to help them out with some growth project or something.

This worthless gasbag is the President of the European Parliament. He deserves the Gustav Noske prize for being a democracy-hating jerk wearing the brand label of Social Democrat.

The Green caucus leader Jürgen Trittin, like Angie a successful politician from the eastern states, dismissed it more on pragmatic grounds than on principle saying it was strictly to satisfy her own grumps in the Christian Democratic Union (CDU) and had no chance of being approved by the 27 members of the EU. He seems to assume, reasonably enough, that all 27 EU members including Britain would have to be down with Angie's Greek Post-Democracy 2.0 proposal for it to become official.

So what excuse does Noske disciple Martin Schulz of the SPD have for endorsing this monstrosity of a proposal?

Tags: greece, gustav noske, spd

With another EU summit coming, Angie demands Post-Democracy 2.0 for Greece

2012-01-28T13:46:00.000-08:00

The euro, the EU and democracy in Europe will have another dramatic day on Monday at the next EU summit. Angie wants to have agreement coming out of that for all EU countries participating, not just the eurozone, to permanently commit to austerity economics, not only in the current depression but basically forevermore.

This can only go on for so long. What can't work will eventually stop working.

And the sovereign debt crisis goes on, in an acute way. Angie's austerity policies can only make the immediate sovereign debt problem worse.

Economist Nouriel Roubini sees Portugal slipping into a Greek state of crisis, probably needing a writedown of the debt. (Roubini prophezeit Portugal griechische Tragödie Financial Times Deutschland [FTD] 28.01.2012) Portugal's interest rates on their bonds have spiked to clearly unsustainable levels. The Portuguese Prime Minister, who not long ago suggested that unemployed Portuguese citizens should consider emigrating to Brazil or Angola, seems to be hiding his head in the side, perhaps for fear of Angie's wrath.

Speaking at Davos, Roubini suggested that Greece might be leaving the eurozone within a year.

And it turns out that the Princess Angela von Merkel may be ready to impose Post Democracy 2.0 in Greece. According to the Financial Times, Angie wants to basically install a financial dictator representing the euro group (read: Germany) to have final say over the Greek budget and expenditures, with the power to override the democratically-elected government. (Though the current debt-collectors' Post Democratic 1.0 regime in Athens previously imposed by Angie is democratic only in a formal sense.) Peter Spiegel and Kerin Hope report in Call for EU to control Greek budget 01/27/2012:

The German government wants Greece to cede sovereignty over tax and spending decisions to a eurozone “budget commissioner” to secure a second €130bn bail-out, according to a copy of the proposal obtained by the Financial Times.

In what would amount to an extraordinary extension of European Union control over a member state, the new commissioner would have the power to veto budget decisions taken by the Greek government if they were not in line with targets set by international lenders. The new administrator, appointed by other eurozone finance ministers, would take responsibility for overseeing "all major blocks of expenditure" by the Greek government.

"Budget consolidation has to be put under a strict steering and control system," the proposal reads. "Given the disappointing compliance so far, Greece has to accept shifting budgetary sovereignty to the European level for a certain period of time."

Angie has lost it. "It" in this case being her sense for democracy.

And since it is the rightwing parties in Europe who have been working nationalist themes for years in opposition to the European Union, this hands them one more political advantage. What Europe, the European Union and the eurozone need more than anything right now is to get Angie out of the ~~European~~ German Chancellorship. (That was an actual Freudian typo on my part there.)

This is obscene:

Athens would also be forced to adopt a law permanently committing state revenues to debt service "first and foremost". ...

Greek voters have already expressed anger about EU attempts to assist in implementing reforms. Horst Reichenbach, the German national who heads an EU task force to assist Greece, was depicted in German military garb by leftwing Greek newspapers when he arrived last year.

Herr Reichenbach received the un-fond nickname in Greece of Third Reichenbach.

And despite IMF General Manager's criticism of Angie's austerity policies this past week, the IMF is joining with Angie to further impoverish Greece and the Greeks:

Even before Germany circulated its proposal, the EU and International Monetary Fund had presented a 10-page list of "prior actions" Athens must implement before the new bail-out is agreed. According to a copy of the document, also obtained by the FT, Greece must cut an additional 150,000 government jobs within three years.

Not so long ago, it was conventional wisdom that a depression could be a danger to democracy. And here is Germany proposing to set aside another major chunk of the superficial appearance of democracy in Greece for the greed of the banksters. This is just awful. And this to override a government that Angie insisted on installing just a few weeks ago for the main purpose of collecting debts for the banks.

From Angie's proposal itself:

Greece has to legally commit itself to giving absolute priority to future debt service. This commitment has to be legally enshrined by the Greek Parliament. State revenues are to be used first and foremost for debt service, only any remaining revenue may be used to finance primary expenditure. This will reassure public and private creditors that the Hellenic Republic will honour its comittments [sic] after PSI and will positively influence market access. De facto elimination of the possibility of a default would make the threat of a non-disbursement of a GRC II tranche much more credible. If a future tranche is not disbursed, Greece can not threaten its lenders with a default, but will instead have to accept further cuts in primary expenditures as the only possible consequence of any non-disbursement. [my emphasis]

Hungary is not the only country in Europe in which democracy is under immediate threat.

Tags: angela merkel, eu, european union, greece, post-democracy

Hopeful sign from the Obama Administration on financial crime

2012-01-28T12:40:00.000-08:00

Even the chronically skeptical Matt Taibbi is hopeful about recent developments in the Obama Administration's approach to financial crime. Matt Taibbi ponders whether Obama's embrace of populist rhetoric is already impacting Wall Street Countdown with Keith Olbermann YouTube date 01/28/2012:

Tags: matt taibbi, obama administration

More on Obama and the SOTU

2012-01-27T18:44:00.000-08:00

I don't think either Newt or Willard Romney is Obama's toughest opponent in the 2012 election. It's Angie.

If German Chancellor Angela Merkel keeps successfully pushing through her austerity policies onto other eurozone lands, it's going to make the European recession worse and very possibly set off a new round of financial crises. Those developments could worsen economic conditions in the US, something Obama and the Democrats don't need politically.

This is all the more reason for them to position themselves as advocates for the 99% and as rock-solid defenders of Social Security and Medicare.

Obama's actions have all too often fallen far short of his progressive rhetoric. But it's also true that, after four years and counting of the current economic depression, the national political narrative has clearly shifted in a more progressive direction, focusing on the very real problems of maldistribution of wealth and the serious economic problems affecting millions. Obama's State of the Union (SOTU) address this week certainly reflected that.

As Katrina vanden Heuvel observes in The Occupy Effect The Nation 01/26/2012:

A few short months ago, the corporate media and inside-the-Beltway chatter was all debt and deficits, all the time.

Occupy changed that. It reset the media narrative so it’s more aligned with the true crises of our times—income inequality, downward mobility and economic fairness. It’s also renewed attention to corporate accountability and the corrosive role of corporate money in politics.

We can also question why we're three years into this Administration and still don't have major prosecutions of financial criminals over the actions that brought on the financial crash of 2008. But the fact that a poor settlement that the Justice Department was ready to close with major banks over mortgage issues has been delayed is in itself important. I'm willing to have some hope that the new financial crimes unit will do some real good. Digby writes about Eric Schneidermann and the task force (Ring fencing Hallabaloo 01/26/2012):

The politics suggest to me that while the administration may indeed be trying to "ring-fence" Schneidermann [into being more open to a permissive settlement for the banks], the real purpose is the glaringly obvious: to cover for their failure to settle this. (Isn't the truism in DC that when you can't get something done, form a commission?)The power in that scenario lies exactly where it did before the task force was announced --- with the state AGs, who as far as I can tell are more empowered not less. ... I'm willing to suspend judgment for a while to see if that means Schneidermann is actually a corrupt chameleon who's taken progressives for a wild ride through his entire career in order to sell himself to the highest bidder or whether he believes he can affect this from his perch on the task force.

I don't see this as a sky is falling sort of thing just yet. There are very good reasons to be skeptical and you'd have to be a fool to buy into the premise at face value. But there are worse things than temporarily tabling a bad deal. And there actually are politicians in the world whose self-serving ambitions are dependent upon being perceived as crusaders rather than players. Everything I know of Schneiderman suggests that the former is the path he's chosen.

I guess, for me, it comes down to this: I don't think the administration is nearly as slick as people think and I don't believe that in an election year like this one they will go out of their way to make enemies of their political allies. Everything suggests that they are trying to make at least a rhetorical pivot to a populist(ish) campaign to face the out-of-touch fop, Mitt Romney. It is what it appears to be: plastering lipstick on this pig of a negotiation and pretending they have a path to a cheap settlement in order to keep both the banks and the people on the hook through the election. They are not working with a strong hand.

And she's very right in saying that progressives don't have to back a third party to make a real, constructive impact in this situation: "Even if activists eventually vote for the president, they can cause huge headaches for the campaign in an election year, particularly in individual states. This is when they have maximum leverage and they should use it."

Then there's the military part of his speech, which contained both the strengths and the problems of his foreign policy. Threatening war against Iran is not a good thing.

But he also put on display the problems of the idolatry toward the military that has become a chronic condition of American politics. Our soldiers deserve praise for serving and for doing their jobs well. But all our soldiers and generals are subject to the law and to the critical judgment of the citizenry and their elected representatives.

Charlie Pierce wrote, "Some of the president's base is not going to be happy with a lot of the speech; I'm not overjoyed with the saber-rattling over Iran, or the notion that the American political system is basically supposed to be Seal Team 6." (The State of the Union and a Would-Be 99% Nominee Esquire Politics Blog 01/25/2012) The passage to which he referred was toward the end, where Obama held up the Seals mission that killed Osama bin Laden as some kind of general model for conduct in America: "All that mattered that day was the mission. No one thought about politics. No one thought about themselves."

Obama was probably hoping for not just a feel-good vibe but also making another pitch in his endless and hopeless case to appeal to Republicans and conservatives who hate his guts, even when they actually agree with much of his foreign and military policy, including especially the most dubious parts like targeted assassinations.

Laura Flanders (Not A Peep About President's Praise for War CommonDreams.org 01/26/2012) points to another complication of holding up soldiers and the military as a general model of good citizenship in civilian society:

Speaking of the troops, President Obama began: "At a time when too many of our institutions have let us down, they exceed all expectations."

Post-show pundits on cable news praised the president's comfort with his commander-in-chief role but none saw fit to mention recent news -- of marines urinating on Afghan corpses, say, or Staff Sgt Wuterich walking free after participating in the killing of 24 unarmed men, women and children in Haditha, Iraq. Accompanying Obama's next phrase, "Imagine what we could accomplish if we followed their example," no one thus far has played vile viral video. The critics have been kind.

And even if there hadn't been so many reports of these kinds of crimes, the whole notion that politics or Congress or the country in general should operate like a small military combat team acting under orders and executing a very specific mission.

This is Obama's "post-partisan" side talking. And his metaphor illustrates how unrealistic that perspective is. We have political differences because people have different interests and different points of view. Some of the worst decisions in American history, like the passage of the USA PATRIOT Act, suffered because of too little debate and discussion and disagreement, not from too much.

It's a very inappropriate metaphor for the proper function of democracy.

Finally, Robert Scheer has a good column on the neoliberal assumptions showing in Obama's SOTU, Obama’s Faux Populism Sounds Like Bill Clinton TruthDig 01/26/2012. I plan to comment on it more in a later post.

Tags: 2012 election, barack obama

Europa special(s), including Umberto Eco

2012-01-26T21:59:00.000-08:00

Six European newspapers published special sections on Europe, i.e., the European Union. It's notable that the occasion for this special coordinated event is an interview with Angie on the European crisis.

The six are:

Gazeta Wyborcza (Poland)

The Guardian (UK)

Le Monde (France)

El País (Spain)

La Stampa (Italy)

Süddeutsche Zeitung (Germany)

The Guardian has this piece: Umberto Eco: 'It's culture, not war, that cements European identity' 01/26/2012. This is an interesting observation:

Asked to describe European identity in 2012, Eco says it is widespread but "shallow". "I am using an English word that is not the same as the Italian word superficiale, but which is somewhere between 'surface' and 'deep'. We must change this, before the crisis strips it [Europe] of everything.

"The university exchange programme Erasmus is barely mentioned in the business sections of newspapers, yet Erasmus has created the first generation of young Europeans. I call it a sexual revolution: a young Catalan man meets a Flemish girl – they fall in love, they get married and they become European, as do their children. The Erasmus idea should be compulsory – not just for students, but also for taxi drivers, plumbers and other workers. By this, I mean they need to spend time in other countries within the European Union; they should integrate."

Eco's wife is German, he's Italian. He speaks from experience.

I also found this observation of his intriguing:

"... Or does the problem [of European identity] go back to God - the fact that the United States becomes ever more religious as Europe becomes even less religious?

"That's the way it is. Back when Pope Wojtyla was still alive, there was much discussion on whether they should accept the European constitution and the continent's Christian roots. Secular people predominated and they did nothing about it. The church protested. There was however a third way, more difficult, but one that would give us strength today.

And that would have been to speak of the constitution of all our roots – the Greek-Roman, the Judaic and the Christian. In our past, we have both Venus and the crucifix, the Bible and Nordic mythology, which we remember with Christmas trees, or with the many festivals of St Lucy, St Nicolas and Santa Claus. Europe is a continent that was able to fuse many identities, and yet not confuse them.

That is precisely how I see its future. As for religion: be careful. Many people who no longer go to church end up falling prey to supersitition [sic]. And many who are non-practising still carry around a little saint card with a picture of Padre Pio in their wallets!"

Padre Pio was one of Pope John Paul II's more controversial canonizations, a guy who promoted a notably superstitious version of Catholicism.

Tags: angela merkel, european union

Malvinas/Falkland Islands dispute

2012-01-26T11:18:00.000-08:00

Britain and Argentina have been having a diplomatic flap the last few weeks over the Malvinas Islands, occupied by Britain since the 19th century, but legitimately claimed by Argentina as their territory. Britain calls them the Falkland Islands.

Argentine President Christina Feranández responds to British Prime Minister Cameron's latest provocative comments on the dispute (Kirchner slams Cameron comments as 'nonsense' 01/26/2012):

This is a Spanish-language report from TV Publica Argentina on the same topic (Reclamo de diálogo por Malvinas 01/26/2012):

Tags: argentina, cristina fernández, malvinas

EU: Angie's counteroffensive

2012-01-25T14:48:00.000-08:00

Angie's been taking some flak for her austerity policies from high places. IMF Managing Director Cristine Lagarde came down hard on her in Berlin. The head of the World Bank, Robert Zeollick is also pressing her from a different point of view to take a more realistic view of the euro crisis in the context of the new European recession (Weltbank-Boss verlangt mehr Führung von Merkel Spiegel Online 25.01.2012) Luxembourg's Foreign Minister Jean Asselborn made a surprisingly blunt set of criticisms of Angie's handling of the euro crisis. (Hans-Jürgen Schlamp, Luxemburgs Außenminister."Merkels Fiskalpakt wird nicht funktionieren" Spiegel Online 25.01.2012)

Asselborn called Angie's fiscal pact that next week's summit is supposed to agree on, a "waste of time and energy." He warned about nationalist tones in attacks on the EU. He didn't specifically mention Germany in this regard, but the remark plainly applies to the sneering tone Angie and taken and encouraged in talking about the moral failings of countries that have come under pressure from bond speculators.

Expressing concern about the declining public confidence in the EU, there wasn't much doubt about who he blames: "Es sind vor allem die Regierungen großer EU-Länder, die ihre eigenen Interessen oft radikal durchsetzen." ("It is above all the governments of the larger EU countries that often push through their own interests in a radical way.") He criticizes Angie for letting internal German politics play too big a role in her approach to the eurozone crisis. Britain, France, Angie: he's talking about you. He compares the current "Merkozy" German-French push for a fiscal pact done as a separate treaty from the EU as such to the creation of an "alliance of the willing", a reference to Bush's notorious bullying of European countries to support the Iraq War.

That's really cold in European terms, comparing Angie to Bush. But I actually think it's accurate in that Angie seems to have been impressed with Cheney's and Bush's approach to creating their Coalition of the Willing, aka, the Coalition of the Billing, since most of them got some kind of financial ~~kickback~~ benefit in return for their nominal participation.

Asselborn objects to the EU-minus-one treaty on basically technical legal grounds, rather than on the foolishness of its basic assumption that writing deficit and debt limits into national constitutions would somehow fix the current eurozone debt problem or new ones in the future. But he's clearly saying it's useless, which I'm sure bugs the Princess Angie von Merkel to hear.

Non-eurozone EU member Poland's Prime Minister Donald Tusk is also grumbling about not being involved enough in the decision-making process and publicly expressed reservations about Poland's approval of the agreement. Some of this may be posturing before the summit. But Angie doesn't like people questioning her orders.

There's lots of pressure, especially from Italy but also from other places like Austria to boost the amount of funding to the eurozone emergency funds (EFSF and ESM)

Now Angie is doing a public relations offensive leading up to next Monday's EU summit, as Stefan Kornelius reports in Merkel will Europas Wirtschaft ankurbeln Süddeutsche Zeitung 25.01.2012.

She apparently sees the need to at least verbally acknowledge the need for jobs and growth. (Duh!) But she still seems fixed on her austerity course for the EU countries, complete with her standard lectures to ~~lesser peoples~~ other EU countries about the need to take responsibility. And she repeats her demand for "labor market flexibility", aka, lower wages, weaker unions, lower benefits. She brushes aware criticism about Germany's dominant role, telling her critics in fellow EU countries ~~to just shut the hell up~~ that while she takes their criticism seriously [cough, choke] there's nothing to them. Oh, and stop asking us for money.

And, Madame Lagarde, you know those eurobonds you were lecturing me about: fuggitaboutit.

Her idea for stimulus is to have some EU funds provide for subsidies to various businesses, a typical neoliberal prescription likely to have next to no stimulative effect in the short run.

Apparently, we don't get to see the full interview until Thursday's papers.

Speaking at the Davos Forum, she told the one-percenters there that, heck, no one should expect quick improvement. Her austerity economics will take another year, year-and-a-half at least to show any results. (J. Eigendorf et al, Angela Merkel beschwört die Solidarität der Europäer Welt Online 25.01.2012)

That Angie is a real piece of work.

Tags: angela merkel, eu, euro, european union

Dems to aggressively wrong-foot Republicans?

2012-01-25T14:06:00.000-08:00

After the experience of the last three years, this is a bit difficult to imagine. But if it does happen, belief in miracles is likely to surge among Democratic base voters: Brian Beutler, Senate Democrats Plan To Put Republicans On The Wrong Side Of The Middle Class TPM 01/25/2012

Senate Democrats are preparing an aggressive legislative agenda to complement the vision President Obama outlined in his State of the Union Address. The goal is to test the idea that the public supports an agenda of aggressive federal action on behalf of the middle class, and that Republicans are locked in a pattern of reactionary opposition, even to popular policies.

The push is premised on the notion that the country has turned the corner on the fights over deficits and the size of government, and that keeping issues of equity and opportunity for the middle class at the center of the national debate will redound to Democrats' political benefit, either by breaking the GOP or by putting them on the wrong side of public opinion.

One of my Facebook friends said that she kept having the feeling while watching Obama's State of the Union address Tuesday, "where have you been the past three years?". And that's kind of my reaction to this.

But Harry Reid showed on abolishing "don't ask, don't tell" and on his push for the Dream Act that he can actually do this well. So I hope they're serious about this.

One of the big political faults of the Obama Administration that caused political problems for him time after time is that he tried to avoid doing just this: going for a full Democratic proposal and seriously fight for, knowing that might lose, or that it could wind up with a compromise that didn't give the Republicans 95% of what they wanted on the deal. The Republicans' willingness to fight and lose on issues important to their narrative and messaging has been a big advantage for them.

Although the part I'm bolding in the following gave me a quick sinking feeling in my stomach:

Congress will first have to clear its plate of the payroll tax cut issue, and other key measures that expire at the end of February. But after that Senate Democrats plan a relentless push on issues with overwhelming public support, knowing full well Republicans have left themselves little space to work with Democrats, and lack the leverage or the positive agenda they'd need to change the subject.

But the payroll tax reduction extension - which has its own problems as policy but those won't be at issue in that fight - itself will be an important moment. The Republicans are almost certain to play chicken with Obama and the Dems over it like they recently did. And if he winds up stumbling along trying various compromise proposals the Reps will inevitably reject, he'll damage his own and the Democrats' messaging yet again before they get to the "after that".

But if they can dodge that bullet - a big if - this sounds right to me:

"We intend to test this theory out by pursuing major chunks of the President's middle class agenda. We’re going to push serious proposals to help create middle class jobs. We're going to defend Medicare. And we will pursue tax reform that makes sense for the middle class," [Sen. Chuck] Schumer said.

Go for it, Dems!

Tags: 2012 election, barack obama, democratic party

Obama's SOTU speech and the inside-outside progressive movement

2012-01-24T20:30:00.000-08:00

Pundits will have lots of fun dissecting Obama's Tuesday SOTU speech. The Washington Post has the prepared transcript posted.

The most significant thing about it to me is that it represents the results of the inside-outside effects of the current progressive movement on the Democratic policy. Obama's critical posture toward one-percenters who export American jobs and law-breaking banksters is a result of the Occupy movement. They really did change the political narrative of the mainstream. It's not that Occupy came out of the blue. But they caught the imagination of enough of the public three years into this depression to resonate widely with popular frustration and anger toward the 1% and their destructive misdeeds.

As a campaign speech, it sounds good. Howie Klein, who's not in the habit of being overly generous to the President's partisanship, tweeted, "I bet every Democrat running for Congress in November is feeling pretty good right now. Republicans must want to kill themselves." (I can't see in Twitter's current configuration how to link to an individual tweet.)

Since voters generally see Presidential elections as a binomial choice between the Democratic candidate and the Republican, Obama's framing in the SOTU, this seems to me to be a decent way for Obama to position himself distinctly on the pro-labor, pro-consumer, pro-99% of the binomial divide. I found his description of the bankruptcy and reconstruction of General Motors to be very effective in that regard. I've always seen that as one of his most sensible and progressive measures, and one which presented a clear contrast to the Republicans, who generally wanted to let GM collapse completely in order to weaken the United Auto Workers union.

On the tactical aspect, Democrats do have reason to be concerned about Obama's post-partisan posturing, which has him pepper-spraying his own most impressive presentations that draw a sharp contrast to the Republicans. For instance, he formulated the event that damaged him greatly in the eyes of independents because of his compromising this way: "The greatest blow to confidence in our economy last year didn't come from events beyond our control. It came from a debate in Washington over whether the United States would pay its bills or not. Who benefited from that fiasco?"

This is classic Obama bipartisanship talk: "Washington" is the problem, not the fact that the Republicans are a wrecker party running a strategy of fundamental opposition and obstructionism to Obama's main domestic agenda.

None of the stream of tweets I saw during the speech called out this line, though: "As I told the Speaker this summer, I’m prepared to make more reforms that rein in the long term costs of Medicare and Medicaid, and strengthen Social Security, so long as those programs remain a guarantee of security for seniors." Why, why, why would Obama or any Democrat think that cutting Social Security and Medicare benefits is good politics? He's referring to the part of "that fiasco" in which the Administration offered the Republicans a deal involving cutting Social Security and Medicare benefits. He may get lucky and have the punditocracy ignore it. But that is bad, bad politics and terrible policy. Bernie Sanders did pick up on it and said clearly it was a bad idea on MSNBC afterwards.

I would also note that the policies Obama did specify were largely the standard "left" version of the neoliberal menu that Jamie Galbraith described in 1996 which avoids macroeconomic policy aimed specifically at creating jobs, instead relying on more passive supply-side and so-called business friendly policies: tax cuts to reward desired behavior, education and training, "infrastructure" justified for its benefits for private business, subsidies for emerging technologies not yet developed to the point that private companies can make bundles of money on them.

And emphasizing how he's supposedly cut regulations and opening up more deep-sea oil drilling plays very much to the Republican master narrative on government and the economy. He even dredged up the basically phony Republican point about regulations on milk spills.

And he did threaten war against Iran: "America is determined to prevent Iran from getting a nuclear weapon, and I will take no options off the table to achieve that goal." It's awful policy, though given the current state of politics in which the main criticism of US interventionism that is part of the Presidential campaign is the segregationist-Bircher crackpot Papa Doc Paul, it's probably good politics to defend against the inevitable Republican charges that he's "weak" and "soft" on foreign policy.

War is not a good thing.

Tags: 2012 election, barack obama, state of the union 2012

Ryan Lizza and "the Obama memos"

2012-01-24T10:30:00.000-08:00

Ryan Lizza's The Obama Memos: The making of a post-post-partisan Presidency New Yorker 01/30/2012 is the kind of insider-baseball story that our punditocracy loves.

And it's an interesting story in its own right. Not least because it gives us a sense of the White House's preferred pitch to the Democratic base.

The pitch isn't too inspiring, though. There's an awful lot of gee, what can a President get done anyway? They (or just Rizza?) oddly invoke Harry Truman as a witness to that fact:

Obama was learning the same lesson of many previous occupants of the Oval Office: he didn’t have the power that one might think he had. Harry Truman, one in a long line of Commanders-in-Chief frustrated by the limits of the office, once complained that the President "has to take all sorts of abuse from liars and demagogues. ... The people can never understand why the President does not use his supposedly great power to make ’em behave. Well, all the President is, is a glorified public relations man who spends his time flattering, kissing and kicking people to get them to do what they are supposed to do anyway."

Ironically, what the Truman quote conveys is that Truman was a President who put a great deal of effort into "flattering, kissing and kicking people" to get his proposals passed.

And in the famous give-'em-hell election of 1948, Truman used the Presidential campaign to aggressively blame the Republicans for their obstructionism. The White House operatives who talked to Lizza may be trying to convey that Obama now realizes he has to do that. But I'll believe it when I see it.

The Obama team's version of the Truman strategy so far, and I believe we see it repeated in this article, is more along the lines of, "Golly heck, we thought the Republicans were going to be all bipartisan and helpful and stuff. And, shoot, it's not our fault that they weren't quite like that. Who could have guessed?" Not exactly the Truman pitch.

This following version of the gee-what-can-a-President-do argument I find particularly silly. Already by the end of 2009, Obama was preparing to strike a more conservative note in 2010. Lizza writes:

Axelrod and other Obama political advisers saw anti-Keynesian rhetoric as a political necessity. They believed it was better to channel the anti-government winds than to fight them. As much as it enraged Romer and outside economists, the White House was on to something. A President's ability to change public opinion through rhetoric is extremely limited. George Edwards, after studying the successes of Franklin Roosevelt, Lyndon Johnson, and Ronald Reagan, concluded that their communications skills contributed almost nothing to their legislative victories. According to his study, "Presidents cannot reliably persuade the public to support their policies” and “are unlikely to change public opinion." [my emphasis]

Wow, that's good to know. That means the Iraq War never happened. After all, it was a wild and totally unnecessary idea, and President Bush had only "extremely limited" ability to sway public opinion!

I don't know which is sillier. That the White House would suggest such a thing (if they did), or that Lizza would write it down as though it's an undisputed social science fact. What it is, is a laughable excuse. The George Edwards to whom he refers is the author of On Deaf Ears: The Limits of the Bully Pulpit (2003). His argument sounds very much like an academic attempt at originality that failed. He's reduced in the book to making arguments like this to sustain his conclusion:

Presidents, even those skilled in the rhetorical arts, are unlikely to be directors of change, reshaping the political landscape to pave the way for change. Instead, they are facilitators, whose greatest skill is recognizing and exploiting opportunities for change in their environment. Being a facilitator rather than a director of change has advantages, however. Following rather than molding public opinion makes presidents and their staffs attuned to how issues resonate with the public and thus the potential for exploiting public support to bring about change. [my emphasis]

In a formulation like this, it's hard to see any substantive difference between a President being a facilitator rather than a director of public opinion change. But even with this argument, the candidate who campaigned for Change in 2008 should presumably have been a great position for "for exploiting public support to bring about change." As Christine Lagarde said in her Berlin speech this week, quoting Hippocrates, "Healing is a matter of time, but it is sometimes also a matter of opportunity." Opportunities pass, and spending three years hoping for a conversion of the Republican Party to bipartisanship on domestic issues was a tremendous waste of opportunity.

In fact, Edwards even makes the case that a President normally has maximum opportunity to be a change facilitator in the early part of a Presidency when the Presidential party has a solid majority in Congress. So even Edwards' flawed conclusions would suggest that Obama should have made a maximum push for his programs at the first of his Presidency. And maybe he did. Maybe he pushed for all he really wanted.

Edwards' argument that Presidents can't further their legislative agenda through a public communications strategy is also heavily based on the ideal of bipartisan compromise. Aggressive public messaging could make the other side angry and make them less likely to compromise and so endangers the President's agenda. Again: Bush, Iraq War.

Lizza, writing about 2009 after the initial stimulus was passed, reports:

Through the rest of 2009, as the anti-government Tea Party movement gathered strength, and conservative voters began to speak of creeping American socialism, Obama’s aides quarrelled over how the President should respond. [Economic adviser Christina] Romer wanted him to press the Keynesian case for his policies—to defend the proposition of increased government spending to fight the recession. Orszag argued that he needed more support from Washington’s deficit hawks, and urged him to create a deficit commission, partly because "it can provide fiscal credibility during a period in which it is unlikely we would succeed in enacting legislation."

It presented Obama with a common Presidential dilemma: Should he use the White House bully pulpit to change minds or should he accept popular opinion? He chose the latter. In his speeches, he began saying, "Americans are making hard choices in their budgets. We’ve got to tighten our belts in Washington, as well." Romer fought to get such lines removed from his speeches, arguing that it was “exactly the wrong policy." She thought the President should emphasize that the government would seek to use taxpayer money wisely, and leave it at that. Instead, he seemed to be accepting the Republican case against stimulus and for austerity. She thought he was losing faith in Keynesianism itself. [my emphasis]

Rizza reports it as a communication strategy. On that score, Romer was very right. Accepting the facile analogy of the federal budgets to family budgets - how many families have their own currency, to name just one of the absurdities of such a comparison - Obama conceded and generally promoting austerity notions that went along with it mainly reinforced the Republicans' push to limit economic growth and undermine Social Security and Medicare.

I also don't believe that it was just a communication strategy. The last three years have given us a lot of evidence that Obama, like way too many Democrats in Congress, actually worry seriously about deficits. The Republicans claim to, especially when there's a Democratic President in office. But I'll believe that there may be a Republican somewhere that actually cares about the deficit when I see Republicans in Congress during a Republican Administration insist on raising taxes for the wealthiest Americans in order to fund the increases in military spending they always demand.

It seems more likely that Obama say the situation in early 2009 as an emergency requiring extraordinary measures that normally were undesirable. To the extent he believes in affirmative government at all, it seems to be limited to the standard, timid neoliberal approach of the New Keynesians in the 1990s: do education and training, build infrastructure in the name of making the private sector more "competitive" in the world, subsidize developing technologies that are not far enough along for private companies to make a bundle off them yet.

Tags: 2012 election, barack obama

Recent installments in the fall of the European Union

2012-01-23T13:52:00.000-08:00

Spiegel Online reports on IMF chief Christine Lagarde's speech in Berlin criticizing German Chancellor Merkel's approach to the European economic and currency crisis: Stefan Kaiser, Madame Oui liest Merkel die Leviten 23.01.2012. The article also comments on the ways Angie's recklessness is isolating Germany in world opinion. They also talk about Lagarde's private meeting with Angie on Sunday, where the areas of agreement were evidently so small that they didn't even issue a standard joint statement afterward talking about their "frank discussions" or whatever other euphemism they might have chosen.

The IMF claims that Spain may face sovereign debt default if Angie doesn't allow the boosting of emergency bailout funds for eurozone sovereign debt: Juan Gómez El FMI ve riesgo de "crisis de solvencia" en España si no se amplía el fondo de rescate El País 23.01.2012.

Plus, the Spanish economy is shrinking, while the new conservative government applies even more severe austerity measures than the previous Socialist government did: Alejandro Bolaños, El Banco de España augura una recesión del 1,5% en 2012 El País 23.01.2012.

Greece is trying to get its private creditors to accept reality and take a sufficient default that will get Greece's debt down to something much closer to a sustainable level: Daniel Flynn and Gernot Heller, Germany, France press for rapid Greek debt deal Reuters 01/23/2012:

Sources close to the talks told Reuters on Monday that the impasse centred on questions of whether the deal would return Greece's debt mountain, currently over 350 billion euros (293 billion pounds), to levels that European governments believe are sustainable.

"There will likely be an updated debt sustainability analysis that will be discussed at the Eurogroup," a banking source in Athens said, requesting anonymity. "Talks will continue this week. The aim is to have an agreement by late next Monday." ...

German Chancellor Angela Merkel said there was no question of extending Greece a bridging loan if talks with the private sector dragged on further.

The euro pushed up to its highest level against the dollar in nearly three weeks on hopes Greece and the banks could overcome differences and seal a successful debt swap.

A cheery headline from the Irish Examiner: Troika warns of financial ‘bomb’ in Dublin by Paul O’Brien 01/23/2012. This has to do with payment to bondholders of the former Anglo bank, now owned by the Irish government and called IBRC:

Anglo, now known as IBRC, is due to repay €1.25 billion to bondholders on Wednesday and Transport Minister Leo Varadkar said householders would suffer if it didn’t.

Mr Varadkar said any decision to burn bondholders would impact on Ireland’s reputation, increase borrowing costs for banks and semi-state companies, and ultimately lead to higher mortgages and household bills.

He said the troika of EC, ECB and IMF, which is supplying Ireland’s bailout loans, had issued a stark warning to the Government about the consequences of IBRC not repaying the money.

"What they’ve said really is that: 'It's on your head. We don't want you to default on these payments. It is your decision ultimately. But a bomb will go off, and the bomb will go off in Dublin, not in Frankfurt.'"

Organized labor is raising a stink over this particular issue:

But Paul Sweeney, chief economist at the Irish Congress of Trade Unions, described the minister’s claims as "nonsense", while Independent TD Finian McGrath said the public did not want to see the bondholders repaid and it was time for the Government to "stare down" the ECB.

It’s not just trade unions and opposition figures who have urged the Government to burn the bondholders. Fine Gael TD Peter Mathews last week secured Dáil time to make his case for halting Wednesday’s repayment, saying Ireland was now "at a moral crossroads".

It's good to see resistance from labor to the dictates of the "troika" demanding that public policy cater to the 1% at the expense of everyone else.

Another piece from the Irish Examiner, this one likely to cause heart palpitations among American Republicans if they saw it: Elffie Chew, Ireland may be first EU state to sell Islamic bond 01/20/2012.

Tags: eu, euro, european union

Christine vs. Angie

2012-01-23T09:52:00.000-08:00

You can't say women are running the global economy these days. But German Chancellor Angela Merkel and IMF Managing Director Christine Lagarde are certainly two key players in international finance right now.

Lagarde comes down pretty hard on Merkel's "ordoliberal" austerity policies in her message Global Challenges in 2012 (prepared remarks) 01/23/2012.

One of my former professors always made a reference to "my good friend so-and-so" if he was about to rake that particular "good friend" across the coals. Legarde opens with a reference to "my good and highly-respected friends Chancellor Merkel and Minister Schäuble", so you know it's going to be bad.

This presentation takes off from IMF findings that will be released Tuesday which, in Lagarde's words, "will lower growth forecasts for most parts of the world. Even these lower forecasts assume a constructive policy path that is by no means assured."

And she gives a sobering reminder that not so long ago would have seemed commonplace, that a depression can really screw a lot of things up. But in our real existing depression, our ruling elites in Europe and the US seem to have forgotten that to an astonishing extent, to a 1914-level-of-dysfunction extent:

Yet before we indulge in yet another bout of collective pessimism, which is becoming something of a global sport, let me ask a simple question—why did 2011 turn out so badly?

I would argue that it was not because of any fresh wound to the global economy. No, it was driven instead by a lack of a collective determination to reach a cooperative solution. We saw many false starts and half measures in 2011 — in Europe, but also, for instance, in the United States with its debt ceiling debacle.

Put simply, policymakers let an old wound fester, and in doing so made the situation worse.

Looking at it from this perspective, 2012 must be a year of healing. But as Hippocrates put it long ago: "Healing is a matter of time, but it is sometimes also a matter of opportunity".

And today, it has to be an opportunity of our making. Otherwise, we could easily slide into a "1930s moment". A moment where trust and cooperation break down and countries turn inward. A moment, ultimately, leading to a downward spiral that could engulf the entire world.

Now when an IMF head starts talking 1930s gloom-and-doom, my first instinct is to think, oh, here comes a pitch for deregulation and letting banksters run wild.

But that's not what Legrande does here. She of the creation of the the European Financial Stability Facility (EFSF) and its upcoming successor the European Stability Mechanism (the ESM), "only two years ago, this was heresy". (Yes, by the time we all learn the initials EFSF, they'll change to ESM.) Her comments are made in a fusion of diplomat-speak and bankerese. But she is encouraging policies that are still considered heretical by Angie and and the German banking Establishment.

She argues for expansionary budget and spending policies in the better-off countries to stimulate the economies of the so-called periphery like Greece and Spain; boosting the resources of the EFSF and folding it more quickly than planned into the ESM; addressing the problem of bank undercapitalization head-on; and, the creation of eurobonds or their functional equivalent. She observes that Europe "is at the epicenter of the current crisis and thus key to the global outlook."

She also pushes the Obama Administration for more mortgage relief, though she tosses in a bit of the tired and misguided conventional wisdom about bringing down the public debt. But in the section on the US, she makes this statement that also seems to be a whack at Herbert Hoover economics in Europe:

This brings me to another worrisome tendency in many quarters—to view fiscal policy as a morality play between profligacy and responsibility. Political and market commentary is too often cast in these terms. Yet markets themselves have been schizophrenic about fiscal tightening, at times rewarding it with lower interest rates, and at other times recoiling at the implied growth slowdown and pushing up interest rates.

That's exactly the perspective of Angie's "ordoliberalism", and it has promoted a retrograde, nationalist outlook in Germany toward other European countries.

And I wish this were the actual perspective of the current American President:

One more point: We must not let financial regulation slip off the policy agenda. We simply cannot carry on with the financial sector that gave us the global financial crisis. We need a safer and more stable financial system, one that serves rather than destabilizes the real economy. While policymakers have made a lot of progress, they still need to complete the reform agenda and ensure that the new standards are implemented in a way that is consistent across countries. [my emphasis]

And these remarks at the end are clearly directed toward Bundeskanzlerin Merkel in particular:

But what we must all understand is that this is a defining moment. It is not about saving any one country or region. It is about saving the world from a downward economic spiral. It is about avoiding a 1930s moment, in which inaction, insularity, and rigid ideology combine to cause a collapse in global demand.

The longer we wait, the worse it will get. The only solution is to move forward together. Our collective economic future depends on it.

More than most, Germany understands the virtues of determined solidarity. Through its experiences with its Soziale Marktwirtschaft and unification, it showed what can be accomplished by bringing everybody together in service of the common good. The world needs a strong leadership role from Germany today, and it is Germany’s core interest to provide such a role.

Let me end with a quote from Goethe: "It is not enough to know, we must apply. It is not enough to will, we must do." (Es ist nicht genug, zu wissen, man muß auch anwenden; es ist nicht genug, zu wollen, man muß auch tun). This is the challenge of our year ahead.

Translation: Angie, it's time to get real, now!

Tags: angela merkel, christine lagarde, world economic crisis

Michelle Goldberg on the Presidential race

2012-01-23T06:00:00.000-08:00

Michelle Goldberg has a good understanding for the patterns of Christian Right thinking. Which means she also has a good insight into Republican base voter thinking, because they are basically identical with the Christian Right, which is largely the same as the Tea Party. So her commentary on the President election could be particularly interesting this year.

She looks at the Newt's culture-war campaign in South Carolina in Newt’s Winning Formula: He Does Scorn and Disgust Better Than Anyone Daily Beast 01/210/2012. She writes:

Last night was a resounding victory for disdain. Gingrich may be a sexual hypocrite, an erratic leader, and a cosseted lobbyist masquerading as a scrappy insurgent, but he is an absolute maestro of contempt, and that is what South Carolina wanted.

Look at what turned his electoral fortunes around. It had little to do with his attack on Mitt Romney's record at Bain Capital. I didn't meet anyone in South Carolina, including Gingrich supporters, who had anything negative to say about Romney's business record. Instead, the race turned in Gingrich’s favor during the debate on Monday, when Juan Williams asked him whether it might be "insulting" to black Americans to say they should demand jobs and not food stamps, and that poor kids should be put to work as janitors. Gingrich, puffed up with righteousness, went on the offensive. To the crowd, he seemed to be putting Williams in his place. No doubt their hearts pulsed as they imagined him doing the same to Obama. [my emphasis]

Reporting on her encounters with staff and supporters in South Carolina is anecdotal, of course. But Michelle actually knows what to listen for, as she showed in her book Kingdom Comin: The Rise of Christian Nationalism (2006). She's not like Tom Friedman running into cab drivers all over the world who happen to agree with exactly what Tommy Friedman is thinking about a particular subject at the moment.

I haven't seen any polling that gets at the subject. But I suspect that the attack on Willard's business practices may reinforce Newt's segregationist culture-war message more than Michelle's interviews are indicating. Because to make the white victimization theme work in connection with economic policies that are intended to give one-percenters like Willard even more wealth and more latitude to do what they do, no matter how damaging it is to the community at large, the Republicans need to cast the enemy of the moment as a wealthy, out-of-touch elitist. One of the services neoconservatives provided to building the current Republican coalition was to articulate and create images that substituted academics, gubment "bureaucrats" and liberal politicians for the image of the fat-and-happy plutocrat feeding on the misery of the people.

But since Newt has an actual plutocrat like Willard to run against, his campaign is using some of the same political imagery the plutocrat George W. Bush, part of one of the richest and most influential families in the United States, used in 2004 against John Kerry.

In other words, it difficult to disentangle negative class images of the wealthy from the culture-war appeals. After all, the entire Republican political project is about getting large number of working people to vote for economic policies that damage their own interests. And to exploit the opportunity the depression and Obama's relatively tepid response to it, the Republicans need to find a way to exploit class frustrations to win votes for an agenda that is entirely directed at comforting the already very comfortable.

Here's a video she did recently, basically warning against third-party illusions on the part of progressives. It's slickly produced, although the way they have her looking off to the side is unfortunately a bit reminiscent of Michele Bachmann's notorious response to last year's State of the Union address - though definitely without the Faraway Eyes:

This appeared at the Daily Beast's controversial Andrew Sullivan article How Obama's Long Game Will Outsmart His Critics 01/16/2012. The first minute and a half has a bit too much blame-the-hippies outlook for my taste. But then she goes into a useful reflection about how the Christian Right got the power within the Republican Party that they came to enjoy.

Tags: 2012 election, michelle goldberg, newt gingrich, segregation, white racism

Newt takes South Carolina with culture war campaign

2012-01-22T12:45:00.000-08:00

Here's Newt Gingrich's South Carolina Primary Victory Speech, the whole thing from PBS Newshour 01/21/2012:

He strikes a real culture war posture here.

Ben Adler writes about this emphasis in his campaign Cultural Populism Catapults Gingrich to South Carolina Victory The Nation 01/21/2012

The moment that most struck me in Newt's speech is just after 7:55 when he praises Ron "Papa Doc" Paul, who, said Newt, "on the issue of money and the Federal Reserve has been right for 25 years." Say what?! Does Newt want to put the US back on the gold standard? Does he want to abolish the Federal Reserve? Is he making a full embrace of John Birch Society economics here? Newt even used the goldbug term "fiat money", a legitimate term around which the Bircher types like to wrap all kinds of bizarre notions. I figured when I saw Charles Krauthammer's column normalizing Papa Doc that overt Bircherism is more acceptable in the Republican Party tha n it ever has been. I'd be happy to see it turn out like 1964. But overt Bircherism wasn't welcome in the Republican Party in 1964. And FOX News wasn't even yet a gleam in Roger Ailes' eye.

Michael Tomasky describes some of how Newt's segregationist/culture-war talk resonated with the South Carolina Republicans, still angrily carrying on the political tradition of John Calhoun (Newt’s Fury Triumphs in South Carolina Primary Daily Beast 01/21/2012):

How and why? Simply, the debates. Even more simply, the two Moments in the debates: the smackdown of Juan Williams, and the smackdown of John King for starting the second debate by asking about his ex-wife's allegations. There is no question that Gingrich rode those two moments to victory.

In other words: He won by hatin' on the black guy and the liberal media. He hated on them expertly. He fired synapses in conservatives' brains that they barely knew were there. You knew, anyone knew, watching those two moments, that they were absolutely pivotal. It wasn't Newt's ideas. Raise your hand if you think his plan to create local citizens' boards to confer citizenship designations on undocumented immigrants made Tea Partiers across the state sit down over dinner and say, "You know, darlin', I'm really impressed with Newt’s civic-minded immigration ideas." Hands? Thought so.

The segregationist rhetoric will get the Republican base out to the polls, along with organizational help from the Christian Right's get-out-the-vote network. Newt's hard-edged radicalism is a big reason he has such huge negatives.

But I'm definitely restraining my enthusiasm for seeing Newt surging in Republican race because right now he looks like a weaker candidate than Willard Romney against Obama. Lots of Democrats thought the same thing about Ronald Reagan in 1980 against Jimmy Carter. And it wasn't until fairly late in the race in 1980 that Reagan took a clear lead.

The Republican candidate whether it's Willard or Newt, has some definite advantages. We're in a depression with high unemployment and a real possibility for a new recession. And this is the first Citizen's United Presidential election and corporate political spending is already soaring. For a description of what's happening o the latter, see George Zornick, Eleven Shocking Facts About Campaign Finance The Nation 01/21/2012.

Then there's the Democratic candidate. Obama can't seem to give even an inspiring partisan speech without pepper-spraying his own message by talking about bipartisanship or balancing the budget or cutting "entitlements", i.e., Social Security and Medicare. All major factors, unfortunately. How he frames things in the upcoming State of the Union (SOTU, to political junkies) address will be a good indication of his political strategy. I'm leery of the advance publicity about such events; but this piece by Amanda Terkel - based on an anonymous source for no apparent good reason - reports the pre-speech White House spin: President Obama Previews State Of The Union Speech To State, Local Officials Huffington Post 01/20/2012.

He's pointing to his own speech at Osawatomie last December 6 as a model for the SOTU. That was the one that offered combative rhetoric that was inspiring to the Democratic base. But then at the end came the pepper-spraying: "These are not Democratic values or Republican values. These aren't 1% values, or 99% values. They're American values. And we have to reclaim them." As Charlie Pierce wrote at the time:

More important, in our current political context, these are very much "99 percent values." They are not one percent values. The One Percent could care less if there ever is a thriving middle class in this country again. They'd sell the entire American middle class to the Somali pirates if there was a buck in it. There may be a political calculation at work here — Embrace the energy of the Occupy movement, Mr. President, but stay the hell out of the damn drum circle! — but the fact remains that the effectiveness of the "We Are the 99 Percent" argument is completely dependent upon its independence from the anesthetic stupor brought on by ameliorative political rhetoric.

It's also been part of Obama's pattern to say nice things that sound good to his Democratic base, then go out and whack the base in some way a day or so later. And the White House is already setting up for this: Alexander Bolton, Obama warns left: You won't like budget The Hill 01/17/12.

Obama's political seems to be really wedded to the "punch the hippies" strategy. But they are never going to be able to out-Newt Newt on the culture war rhetoric - or even outdo Willard on it, for that matter. They would be much better advised to align themselves clearly with "99% values" and can the bipartisanship hokum.

Tags: 2012 election, barack obama, newt gingrich

The curse of the Democratic Party

2012-01-21T19:23:00.000-08:00

Neoliberalism is the curse of the Democratic Party. The economic kind, not some variation on social policy. The Washington Consensus, deregulate the banks and let the markets run wild but try to keep public services functioning at a minimal level kind. Neoliberalism of the Davos Forum, prophets of globalization kind.

Jamie Galbraith wrote about this back in 1996, as Bill Clinton was facing a by-no-means-sure re-election, in The Surrender of Economic Policy The American Prospect Mar 1996. For some reason, the article at the link now says December 19, 2001, but it's from the March 1996 issue.

Like Obama today, the Clinton Administration had adopted moving toward a balanced budget as a guiding principle of its economics policies. Both Clinton and Obama really seem to believe that a balanced budget is a virtuous goal of policy in itself. But there are a number of reasons making it a central goal of a Democratic Administration is self-limiting and/or self-defeating for Democratic Administrations. Galbraith:

To accept a balanced budget and the unchallenged monetary judgment of the Federal Reserve is, by definition, to remove macroeconomics from the political sphere. Thus, the remaining differences between Clinton and the Congress are over details. Should we head for budget balance in seven years, eight, or ten? Should we cut (or impose) this or that environmental regulation? Do Head Start, the AmeriCorps, and technology subsidies justify their cost? And so on, in long litanies that no one believes will make a fundamental difference in American lives. Even if there were substantial gains to be made by public investments on the supply side, the conservative fiscal consensus precludes them by denyingthe resources.

We have now seen two Democratic presidents--Carter and Clinton--deeply damaged because they did not dispute this orthodoxy in good time and therefore could not control the levers of macro policy. Macroeconomics, not microeconomics, is the active center of power. Practical conservatives understand this. It is no accident that conservatives always seek to control the high ground of deficit and interest rate policy, nor any surprise that liberals defeat themselves from the beginning when they concede it.

Yet, the economics behind this consensus is both reactionary and deeply implausible. It springs from a never-never-land of abstract theory concocted over 25 years by the disciples of Milton Friedman and purveyed through them to the whole profession. Liberals--and anyone else concerned with economic prosperity--should now reject this way of looking at the world. [my emphasis]

But the Clinton Administration in 1996 was apparently guided by some more coherent economic policy theory than the Obama Administration. Galbraith noted that New Keynesians were "a breed found throughout the Clinton administration."

The Obama Administration, by contrast, seems to be relying on a general orientation that said we just needed to shore up the failing giant banks in 2009 and the economy would soon bounce back to a healthy state. Those like Paul Krugman who took the Keynes part of New Keynesian seriously realized, especially after the Japanese depression of the 1990s, that depression economics was still relevant to the present day. But policymakers in the Obama Administration and Europe have fastening onto a bizarre and destructive austerity economics during the current depression.

Galbraith in that article gives a useful and accessible description of one the favorite myths of conservative economics, the "natural rate of unemployment". Galbraith wrote that in 1994, "the natural rate" was "estimated by numerous astrologers at about 6 percent." We don't hear a lot about that today, because even Republicans don't want to say that the depression rates of unemployment are "natural". But if you listen closely to David "Bobo" Brooks talking about "structural factors" or whatever, you can tell there's a similar idea still waiting to justify do-nothing policies in the face of high unemployment. But it's basically a simple propaganda point with no real-world content to it.

We're also seeing today some of the serious repercussions of the Democrats surrendering what these days we call The Narrative on economic policy to the Republicans. Because the Democrats bought onto the concept of the singular virtue of balancing the budget and the general uselessness of macroeconomic policies, now we have a bipartisan consensus in Congress on austerity economics in the middle of a depression.

Galbraith's 1996 article spelled out what a limited menu of policies that even New Keynesianism was offering then:

At the very least, New Keynesian acceptance of the New Classical theoretical structure reduces macroeconomic policy to the fringe role, that of large-scale intervention only in deep and lasting recessions. In all other circumstances, the macro authorities are warned off--as was Clinton himself during his brief Keynesian phase in early 1993.

What then can liberals do? The actual approach of the Clinton administration illustrates: Liberals can favor education, training, adjustment assistance, and other programs that upgrade skills and help workers move from one job to the next. They can support public investments in infrastructure, on the ground that these assist in the international competitiveness of the economy. They can support a combination of research and development assistance to advanced enterprises, alongside efforts to open foreign markets to American products, that help shore up the position of American companies in the world. If they are feeling brave, they can also support a higher minimum wage.

All of these are supply-side measures (except the last, which is a direct intervention in the labor market). Their purpose is to improve the long-term competitive performance of the American economy, on the thought that a more productive economy will generate higher average living standards. The further thought, that these higher averages will trickle down to low-paid production workers, is left as an assumption.

However, if New Keynesians favored "large-scale intervention only in deep and lasting recessions" in 1996, there has been a downright devotion to austerity economics in the Obama Administration. It's interesting to note that, like Obama, Clinton had "his brief Keynesian phase in early 1993" in the early months of his Administration. But Clinton took office with an economy beginning recovery, and in which depression conditions had not taken hold. If Clinton's economics policies in his first Administration were too timid, Obama's have been terrifyingly so.

Galbraith also provided useful observations about the limits of the New Keynesian nostrums, which I summarize here:

Education and Training: They are necessary and critically important but they don't create jobs in themselves. Also, US public schools aren't nearly as bad as conservatives claims they are.

Research and Development: Advances in technology "do not and cannot bring full employment, nor do they bring about a fairer and more just social order. To make science and technology policies the centerpiece of a progressive agenda, while giving up macroeconomics, is absurd."

Infrastructure: Great stuff, but Democrats make a mistake in justifying public works primarily as support to the private sector to make the US more competitive internationally rather than also stressing their value in creating jobs. And in any case, the claimed benefits to private "cost reduction and increased output" are based on thin empirical evidence. Instead, liberals ought to be stressing the value of infrastructure for the people.

And Galbraith stresses that Democrats needed to make fairness in wealth distribution a central issue for economic policy:

Once the basic distribution of income has been set right, further gains in real wages can only happen, on average, at the rate of productivity growth. But to
keep the distribution from getting worse again, these gains should be broadly
distributed, substantially social and only slightly industrial or individual.
In other words, we need to return to the principle of solidarity--that the
whole society advances together.

It took 15 years, a depression, union resistance to Republican Governors' aggressive antilabor push, and the Occupy Wall Street movement to force the Democratic Party to start taking this issues more seriously. And so far, it hasn't gotten beyond lip service.

Democrats need to start listening more to the Jamie Galbraiths, Paul Krugmans and Joe Stiglizes of the world and less, much less to investment bank executives.

Tags: austerity economics, james galbraith

What makes Angie tick? (6 of 6) A few good words for Angie

2012-01-21T08:00:00.000-08:00

I personally find the history of Communist East Germany, the German Democratic Republic, (DDR, from the German initials) fascinating. The same is true of Angie's childhood in it.

Angie's father was Horst Kasner (1926-2011), a Protestant minister who voluntarily accepted a parish in the DDR in 1954, shortly after Angela's birth. Being a PK (preacher's kid) invites extra scrutiny even in countries where organized religion is officially discouraged. Churches were never outlawed in the DDR. But they faced various degrees of discrimination. The daughter of a minister, for instance, would have a hard time getting admitted to a university.

Horst Kasner over time became more sympathetic to the regime. Or, more precisely, he became one of those church figures like Manfred Stolpe who walked a difficult line between protecting the churches from excessive state interference and providing support for it within the churches.

Horst Kasner, Angela Merkel's father

It was a paradox of the DDR's system. Since the regime expected any public discussion related to politics to remain within the framework of Communist ideology, the only formally legitimate way to express disagreement government policy was to frame it in terms consistent with Communist ideology. Which in turn meant that even criticisms framed in terms of the official socialist ideology fell under suspicion of being a more basic dissent against the state and the Communist system itself.

Neither Kasner nor his oldest child Angela were active resisters to the Communist regime. But much of the active resistance that did take place acted within an ecclesiastical framework. Because the churches did provide an institutional space in which an ideology (was Christianity was from the official viewpoint) other than strict adherence to the regime's line was officially tolerated, though with serious limitations.

So Angela learned early on to maintain a set of views about life (Christianity) that was different and under suspicion from the publicly approved consensus. She was able to get into university - the one then known as Karl Marx University in Leipzig - where she studied physics. But she also maintained friendly relationships with people who were more actively dissident. Someone growing up in those conditions could have become simply duplicitous, a skill that is useful in politics and business but not an admirable one, and one that also has distinct disadvantages.

Angie wouldn't have become Chancellor of Germany without learning how to play her cards close to the vest in many instances. But in her case, the experience seems to have resulted in real independence of judgment and an ability to hold on to them in the face of pressure.

Her education and early professional experience as a physicist gave her an appreciation of science and rational thinking that Germans may not find so remarkable in a politician. But in the US Republican Party, declaring confidence in science could be enough to make one noncompetitive in a Party primary.

These two qualities seem to have played major roles in Angie's positions on abortion and stem-cell research, which found her dissenting from the Catholic Church's position and also that of many Protestant ministers who wanted to ban them. She supported abortion rights against the churches' position and argued for freedom of research on stem-cells. One could make an argument that she didn't go far enough on either. But her willingness to stand up to the church factions on those issues is something I find admirable.

Angie's commitment to protecting the environment also seems to be genuine. She served as Environment Minister in Helmut Kohl's government. And she holds up the Climate Summit in Berlin in 1995 as one of her accomplishments of which she's most proud. As the host of the conference, she did an impressive job of getting 130 nations to agree to make climate change a priority, thus preparing the way for the Kyoto Treaty.

Angie does have a green side

And her record as Chancellor provided continued evidence that she indeed takes environmental protection seriously. Most dramatic was her action just this past year after the Fukushima nuclear power plant disaster in Japan, when she insisted on accelerating Germany's phaseout from the use of nuclear energy for power. Her experience with the nuclear industry in the 1990s as Environment Minister may have played a role. She backed the nuclear industry on the controversial transportation of nuclear waste, known in German as Castor transport from the name of the container type, until she discovered via media revelations that the industry had failed to properly monitor their transports; she reversed her position on the Castor transport issue. Lingering distrust of the nuclear lobby may have played a role in her position in 2011 on accelerating the phaseout of nuclear power.

She's obviously aware that Germany has competitive gains to be made by a strong push on developing solar and wind power. But she does seem to take environmental protection seriously, though the Green Party would be quick to point out her real deficiencies in that area. And her understanding of her Christian faith in terms of responsibility for the care of the earth also seems to play a role in her thinking on this issue .

Volker Resing's biography emphasizes the religion-related aspects of her career. She played an important role in opening her Christian Democratic Union (CDU) to Protestant voices, where the Catholic Church had previously been more exclusively the "C" in the CDU. Her public formulations of her positions are also attractive, especially for Americans worried about the increasingly overt Christian dominionism of the Republican Party. She warns explicitly against assuming that we can know precisely what God's opinion on a political issue can be. She argues that a Christian should be informed by their religious worldview, but it's still up to individuals to take responsibility for making judgments on political issues in a secular democracy.

On the other hand, she tried to get an official recognition of the Christian concept of humanity written into an EU treaty. And she insists on calling the Christian concept of humanity a basic value of European civilization. Although she formulates it in non-theocratic terms of human rights and personal dignity, she is nevertheless arguing that the Christian religion should take primacy both in her Party and in some important sense in German and European politics. Since I tend to be a hardliner on separation of church and state from both the Christian and secular-democratic viewpoints, this aspect of Angie's thinking is something I find disturbing, especially at a time when the Western democracies' relations to the Islamic world have become increasingly important.

When it comes to Angie's insistence on forcing destructive austerity policies, it's likely we're seeing some of the dark sides of her strengths. Strength of conviction is admirable when the convictions make sense and are open to revision, expansion or modification in the face of evidence. Angie's commitment to "ordoliberalsim" and austerity economics during a depression seems remarkably immune to pragmatic adjustment. And her Christian convictions don't seem to make her willing to reconsider that approach even in the face of the real human costs we clearly see now in Greece, Portugal, Spain and Ireland.

At the risk of veering into pop psychology, I also wonder if her particular training in the hard sciences may be also leading her astray in thinking about economics. Ordoliberalism with its rigid principles posing as economic laws and alleged mathematical certainties may appear unduly attractive to someone more comfortable with a hard science like physics. It may also be attractive to her because its advocates cast it as a direct repudiation of Communist economics that were part of the DDR system she rejects.

But we also shouldn't forget that one-percenter economics, no matter how self-destructive its implications can be even for some of the very wealthy, carries a lot of clout and frames the context in which Angie is carrying out her mission to put Europe on permanent austerity economics. The CDU prefers to call itself a popular party (Volkspartei). But it's still the party of Big Capital. And Angie's attempts to force her ordoliberal faith on Europe will almost certainly be what defines her legacy as a political leader.

Sources on Angie's life and career:

Gerd Langguth, Angela Merkel.Aufstieg zur Macht - Biographie(DTV; München) 2007 edition
Michael Lümann, Der Osten im Westen - oder: Wie viel DDR steckt in Angela Merkel, Matthias Platzeck und Wolfgang Thierse? Versuch einer Kollektivbiographie (ibidem-Verlag; Stuttgart) 2010
Angela Merkel, Mein Weg.Angela Merkel im Gespräch mit Hug Müller-Vogg (Hoffmann und Campe; Hamburg) 2004
Volker Resing, Angela Merkel.Die Protestantin - Ein Portrait (St. Benno-Verlag; Leipzig) 2009

Tags: angela merkel

The euro crisis and balance of payments

2012-01-20T10:27:00.000-08:00

One integral aspect of the euro crisis that doesn't get mentioned in news stories as often as others is the balance of payments/trade deficit part. Looking at that side of the problem is a reminder why the advice of Germany's Chancellor Angela Merkel and her Angie-bots that other eurozone countries should remake themselves in Germany's interest is so absurd in the current situation.

Heiner Flassbeck deals with it in A German end to the Euro vision Euro Intelligence 18.01.2012, as does Wolfgang Münchau in Wir bekämpfen die falsche Krise Spiegel Online 18.01.2012

Germany relies heavily on exports. Most of their exports are to Europe, and a large proportion to other eurozone countries. So Germany has been the single biggest winner to date from the trade advantages of the common currency.

Because Germany exports more than it imports, it typically has a surplus in its balance of trade. Those of its trading partners who import more than they export run trade deficits. We could say that the laws of accounting make impossible a situation where every other eurozone country could develop a similar model to Germany's by running surpluses with lots of other eurozone countries.

Flassbeck:

Since the end of Bretton Woods, Germany’s economic policy has been based on two main pillars: competition of nations and monetarism. Both are irreconcilable with a monetary union. A monetary union is in essence a union of countries willing to harmonize their rates of inflation and to sacrifice national monetary policies. A country like Germany, fighting for higher market shares in international markets, tries to achieve the opposite. It has to undercut the cost and price level of its main trading partners by all means. A monetary union formed by already closely integrated countries becomes a rather closed economy and needs domestic policy instruments like monetary policy to stimulate growth time and again. German monetarism asks for the opposite, the absence of any discretionary action of central banks and relies solely on flexibility of prices, in particular wages.

Along these lines the story of EMU’s failure is quickly told. From the very beginning of the monetary union, German politicians put enormous pressure on trade unions to help realise an increase of unit labour cost and prices that was less than in other countries. Since member states no longer could devalue their currencies to maintain competitiveness as they had done hitherto this was a rather easy task. The effects got stronger as small annual effects accumulated over time and, after ten years, created a huge gap in competitiveness in favour of Germany. Germany built up huge current account surpluses and Southern Europe and France accumulated the complementary deficits. [my emphasis]

Münchau discusses this problem in the context of differential rates of development in the eurozone. And he reminds us that even if the European institutions were doing what needs to be done to save the euro in the short run - which they aren't doing and can scarcely be expected to do so at this point - it won't fix the euro's problem in the longer run without a real fiscal and transfer union that would systematically promote more balanced development within the eurozone.

Flassbeck's bottom line on the Merkel/Sarkozy austerity course they've imposed on the eurozone: "Captain Merkozy's boat approaches the rocks at high speed."

One notable aspect of Flassbeck's piece is that he articulates the consequences for peace and democracy of a European Union crackup:

Once upon a time European leaders believed in a step-by-step approach of European integration. Each step would bring Europe closer to the target of closely related but still independent states. According to this vision states would be willing to relinquish more and more of their independence, in order to gain advantages of peace, global strength through political cooperation and economic strength as a result of a big common market. In this approach, the creation of a monetary union was just one of these consecutive and unavoidable steps on the path to strengthen political cooperation and to complete the common market with its indisputable advantages for all European citizens. [my emphasis]

Tags: eu, euro, european union, heiner flassbeck, wolfgang+münchau

What makes Angie tick? (5 of 6) Angie on foreign policy

2012-01-20T08:00:00.000-08:00

Angela Merkel's foreign policy has been on all-too-visible display in the current crisis of the European Union, a crisis largely of her making. She's shown a willingness to bulldoze her nominal EU partners and use Germany's financial clout to attempt to force on the EU countries her own "ordoliberal" concepts of austerity economics in the middle of a depression. And that in the face of clear evidence that austerity economics is making the sovereign debt problems which they are allegedly intended to alleviate worse and worse.

Her drive for power and her willingness to take risks are not surprising. Her willingness to so blatantly try to subject the EU countries to German dominance is. Jakob Augstein writes, "Was am Anfang ihrer Kanzlerschaft noch als Ausweis besonderer Modernität missverstanden werden konnte, hat sich längst als Schwäche erwiesen: die Abwesenheit von irgendeinem Willen außer jenem zur Macht." ("What at the beginning of her Chancellorship could still be misunderstood as evidence of special modernity has long since shown it to be a weakness: the absence of any kind of will other than the will to power.") (Reise ans Ende der Macht Der Freitag 01.09.2011)

That may be a bit harsh. Angie really seems to believe in her ordoliberal doctrine of austerity. Her current recklessness is more likely to leave Germany far weaker overall by destroying the EU, the euro and the benefits Germany has gotten from both.

But her aggressive behavior in the current crisis has made me wonder what her models for foreign policy are. My intention here is not to analyze her whole foreign policy, but to point to what seem to me to be decisive influences.

Angie was 35 when the Berlin Wall fell. She grew up in Communist East Germany, was member of the Communist Party's youth group the Free German Youth (FDY, from the German initials), graduated from Karl-Marx University in Leipzig, and worked as a physicist in East Germany. She was 35 when the wall fell. I've wondered if her outlook may have some basis in growing up in the Warsaw Pact. I've said only partially jokingly that she seems to think she should run the EU like Brezhnev rant the Warsaw Pact.

But there seems to be little evidence that she was particularly impressed by the Soviet Union's foreign policy. She was not an active dissenter against the Communist regime. But the biographical evidence seems to suggest that she was unsympathetic to the crushing of the Prague Spring in 1968, either at the time (that was the year she turned 14) or in her later understanding of it. Other than Soviet dominance of East Germany, she doesn't seem to have shown any special interest in international relations before 1989. Of course, she was German and did like to travel!

The unification of Germany in 1990 seems to have had a huge effect on her thinking. As fate, luck and ambition would have it, she was part of the German delegation to the "4-plus-2" talks in Moscow that led to agreement on the unification of Germany. It was dramatically obvious, as Gerd Langguth's biography points out, that once the unification was agreed upon, negotiating the details of Soviet withdrawal was handled by the West Germans. And of course, once the unification occurred, the democratic East German government of which she was a part disappeared. There does seem to be some evidence that she viewed unification as an absorption of the east by the west but that she regarded it with more admiration than resentment, unlike many other former East Germans.

It also seems to me that the foreign policy approach of Dick Cheney and George W. Bush was a big part of Angie's model for approaching foreign affairs. Unlike her Party's official position, she was vocally supportive of Bush's build-up to the Iraq War. Even in her 2004 book Mein Weg, she defended the Bush Administration's conduct even if Iraq had no weapons of mass destruction. And she still harshly criticized the antiwar policy of Social Democratic Chanceller Gerhard Schröder and his Green Foreign Minister Joschka Fischer in 2002-3.

Ironically, one of her main justifications for her criticism is that she argued that Schröder's and Fischer's government should have worked harder to bridge the policy differences with Britain over the Iraq War buildup. She charged Schröder with damaging European unity thereby.

It's a disingenuous argument in itself. British Prime Minister Tony Blair was joined at the hip with Cheney and Bush over the Iraq War. The only way Germany could have had a common policy with Britain in that situation was to kowtow to Washington just as Blair did.

But the ironic part is that Angie in December of 2011 was part of a far more drastic diplomatic conflict with Britain than anything that occurred under Schröder when Prime Minister David Cameron bolted the EU summit, rejected Angie's demands for EU treaty changes. Cameron's actions were clumsy and arguably just plain dumb. But Angie was perfectly happy to tell Cameron to kiss off if he didn't want to go along with her "ordoliberal" policies for the EU.

It's also notable in Mein Weg that Angie explicitly endorses the concept of "preventive war". After her heavy involvement in the issue, Angie surely in 2004 knew that there is a very clear difference between "prevention" war and "pre-emptive" war. The latter is initiating military action under threat of imminent attack and is legal in international law. Preventive war is what the Nuremberg Trials treated as "aggressive war", i.e., launching military action when the target country presented no imminent threat. Even the Bush Administration was careful to claim that what they were doing in Iraq was a preemptive strike which they could claim was legal in international law. It wasn't; the Iraq War was a preventive war and an illegal one, a big reason Bush and Cheney and other senior national security officials from that Administration now have to be very cautious to which foreign countries they travel for fear of arrest.

This was thoroughly discussed in German politics and the press in 2002-3, and Angie as Chair of the CDU was very much involved in the issue, even travelling to Washington to do what she could to show her solidarity with the Iraq invasion. Her willingness to publicly endorse the concept of preventive war is a strong sign that she was deeply impressed by the Bush Administration overbearing approach to dealing with allies.

It's not that she was a Bush toady like the pathetic Tony Blair. She would later clearly and publicly condemn the Administration's practice of torture. And as Chancellor, she would try to push the Bush Administration to take action against global warming.

But her willingness to publicly and explicitly endorse the concept of preventive war when she was surely conscious of its historical and legal implications is a strong sign there's a bit of Dick Cheney in her. Which is why her current actions in the EU bear more than a passing resemblance to the way Cheney and Bush assembled their "coalition of the willing" for the Iraq War.

She didn't need Leonid Brezhnev to teach her domineering approaches to international relations when she had Dick Cheney available.

Sources on Angie's life and career:

Gerd Langguth, Angela Merkel.Aufstieg zur Macht - Biographie(DTV; München) 2007 edition
Michael Lümann, Der Osten im Westen - oder: Wie viel DDR steckt in Angela Merkel, Matthias Platzeck und Wolfgang Thierse? Versuch einer Kollektivbiographie (ibidem-Verlag; Stuttgart) 2010
Angela Merkel, Mein Weg.Angela Merkel im Gespräch mit Hug Müller-Vogg (Hoffmann und Campe; Hamburg) 2004
Volker Resing, Angela Merkel.Die Protestantin - Ein Portrait (St. Benno-Verlag; Leipzig) 2009

Tags: angela merkel

Obama's progressive defenders (one of them anyway) and nails-on-the-blackboard history

2012-01-20T07:00:00.000-08:00

Like Big Thinker Francis Fukuyama, writers such as Huffington Post columnist Bob Cesca who defend the Obama Administration from a position supposedly sympathetic to a progressive viewpoint need some leftist to bash. In Progressives, Obamabots and a Realistic Evaluation of the President 01/19/2012. It bothers him to be called an Obamabot. He tries out an argument that I don't recall having encountered before, which says, well, at least Obama isn't as bad as Franklin Roosevelt:

Historically speaking, no president in American history boasts a flawless record of achievement without dark stains on his record. The chief executive lauded as being the liberal hero of the previous century, Franklin Roosevelt, committed some of the most egregious crimes against humanity in the name of prosecuting World War II, not to mention other, lesser shortcomings. He authorized total war against the Axis powers, giving the military complete latitude to annihilate civilian populations in Europe and Japan using the most deadly weapons of that era. In a modern sense, the firebombing of Tokyo alone would earn Roosevelt an hourly shaming from the progressive blogosphere, if not an outright call for impeachment. Add to it the indefinite detention of the entire Japanese-American civilian population and the authorization/funding of the Manhattan Project ushering in the Cold War nuclear era and progressive heads would be exploding all over the Roosevelt administration's record. But historians, both liberal and unaffiliated, regard Roosevelt in a very different light. The New Deal achievements, Social Security and his posthumous victory in World War II outweigh the questionable deeds along the way.

I'm all for taking a critical viewpoint of all Administrations. The internment of Japanese-Americans never suspected or accused of a crime was and is indefensible.

But Cesca makes a surprisingly sloppy argument. For one thing, the "entire Japanese-American civilian population" was not detained. The internment order did not apply to Hawaii, where actual cases of Japanese-Americans committing acts of espionage had occurred. It's one of the historical facts that illustrates how bad and unnecessary and wrong the detentions were in California, where not a single known case if espionage by a Japanese-American had occurred.

There is also plenty to criticize about the "strategic bombing" of the Second World War. The Army's own postwar studies of their results in Germany and Japan were an early source of some of the most important of them. But it is simply not the case that the US military was given "complete latitude to annihilate civilian populations in Europe and Japan." It's the kind of thing revisionist apologists for the German or Japanese regimes of that time would say.

Cesca summarizes the progressive side of Obama's achievements this way:

By my accounting, and conservatively speaking (small "c" conservative), there are more than 100 achievements of varying importance ranging from the rescue of the economy from the brink of another Great Depression to the rescue of the American auto industry to the largest middle class tax cut in American history to the repeal of Don't Ask Don't Tell. At the very least, and not insignificantly, President Obama's ideas and political savvy paved the way for African-Americans to finally reach the highest political office in the world. The last segregated office is now multi-racial. This can't be understated or ignored. Furthermore, the president just wrapped his third year in office and, much to the chagrin of the far-right, he has at least another year in which to tackle more items on the to-do list.

These items and dozens more are legitimate and undeniable successes, some of them are historically important and many of them are distinctly liberal. Some of them are compromised successes for the sake of passage through a deeply divided Congress and some of them are exacting and untouched. (Various critics note the president had a filibuster-proof 60 Democratic vote supermajority in the Senate for his first two years. This is a fallacy as the Democrats have never been a lockstep caucus. There were at least 10 conservative Democrats like Evan Bayh, Joe Lieberman and Ben Nelson who vigorously opposed legislation like cap-and-trade and the public option and who often voted or threatened to vote with the Republicans to filibuster such items.)

Cesca is in part responding to a Newsweek article by Andrew Sullivan, How Obama's Long Game Will Outsmart His Critics 01/16/2012.

Obama is not playing any long game to enact progressive accomplishments.

The game he's playing as President is clearly better than the game the Republicans would like to play.

But Obama has shown himself to be essentially a cautious, conservative Democrat who has been willing to take some progressive steps like those Cesca mentioned because he needs to do something to please his base. His first three years in office provide little reason to even hope that he will transform himself into an eager progressive leader in a second term.

One of the clearest signs to me that he has never had any progressive long game is the fact that he didn't make the Employee Free Choice Act to reinvigorate union organizing one of his top priorities from the moment he was elected. The Republicans know the labor movement is still a critical element in mobilizing votes for Democrats. If Obama had a long game, he would be doing everything he could to facilitate building the labor movement and getting more workers organized into unions.

Those who are playing the long game are progressives who are working on an inside-outside approach. People like Blue America, who are promoting and raising funds for real progressive candidates like Elizabeth Warren, running for the Senate in Massachusetts. People like Occupy Wall Street protesters, who have already forced the maldistribution of wealth and the need to restrain financial bandits onto the agenda of the two major parties and into mainstream political discussion. People like The Young Turks Cenk Uygur, whose Wolf PAC is challenging the power of organized money in politics and fighting to overturn the reaction Citizen's United decision's notion of corporations as people with the right to spend unlimited money to corrupt the electoral process.

Until there is a powerful enough popular progressive movement that influences the Democratic Party but is not subordinate to it, the 1% will continue to dominate both parties.

Tags: 2012 election, barack obama, democratic party

Conservative Big Thinker looks for new challenge

2012-01-20T06:01:00.000-08:00

Scene: Two men in comfortable arm-chairs facing each other across a wooden coffee table, in what appears to be an old-fashioned men's club with dark paneled wood walls and tall bookshelves full of books. The older man has his hands folded, gazing thoughtfully as though into the distance, though only the bookshelf opposite meets his gaze. The younger man holds an iPhone toward which he stares intently while listening via earplugs.

The older man signals to a passing waiter: Charles, a third brandy, please.

CHARLES the waiter: Yes, sir, professor.

THE PROFESSOR, looking thoughtfully toward the ceiling: You know, Biff, back in the old days, we conservatives had Great Opponents. Marxists were everywhere, and their hell-spawn the New Deal and the Great Society. We were fighting a lonely battle, out there on the edge of the End of History. Then Reagan went to Berlin and told Gorbachev to tear down that wall. And he did. And the Iron Curtain fell.

BIFF, glancing up briefly: Oh, yeah, I heard them talking about that on FOX.

THE PROFESSOR, taking a brandy from the waiter: Then, we had won. Liberal democracy had triumphed. Everyone wanted to be like the United States. Everyone bought off on the idea that globalization and high tech meant we could roll back regulations and let speculators run wild. Then came 9/11 and everyone agreed that the US should run the world.

BIFF, glancing up more briefly: Uh, yeah. But aren't there some Communists still in China or somewhere?

THE PROFESSOR: Oh, yes, but they're really capitalists, and who really cares about the Chinese anyway? And there are probably some peasants out in India or the Andes or somewhere who make cranky complaints. But everyone loves the system because pretty much everybody's middle class and nobody cares that it's only the filthy rich that are really making out with this thing.

BIFF grunts.

THE PROFESSOR, warming to his subject: But look, Biff. Great Thinkers need Great Challenges. And we don't have any today. Sure, it's fun to sit around and say stuff about Marxists and liberals. It gets hard to remember the old arguments exactly, but nobody much notices when we change them around.

What we need is some new leftists around. Not for real of course, just for entertainment. And there are enough uneducated plebes out there still that could take them seriously. Of course, they need to stop talking about all this stuff about minority rights, we're all soooo tired of that. And this nonsense about women's needs and their rights to their icky bodies and all, nobody who matters takes that stuff seriously.

[Draining his glass:] And they need to forget about promoting unions and social security and health care and all that because we can't afford it any more. But they could complain that maybe sometimes the results of globalization aren't fair [chuckles]. And they could say we need better schools or something. Then we would have somebody new to argue with and we could produce Great Thoughts again.

BIFF [aside to audience]: Here I'm watching the best porno flick I've seen in months, and this old fart is trying to talk to me about politics or something? Why can't he just go back to sleep and ... Oh! Look at that!!

This is my dramatized summary version of Francis Fukuyama's article "The Future of History: Can Liberal Democracy Survive the Decline of the Middle Class?" in the Jan/Feb 2012 Foreign Affairs. And this guy is considered one of the conservative Big Thinkers around these days.

Tags: francis fukuyama

Irish economic crisis and bank bailouts

2012-01-19T15:21:00.000-08:00

Ireland prior to the depression was held up by "free market" enthusiasts as a shining success story of neoliberal policies. But when the crisis hit, Ireland decided to use public money via bond sales to cover the bad debts that would have put Ireland's large banks underwater. That is what made their debt load a sovereign debt crisis.

The alternative would have been the one Iceland used, which is to let the banks go bankrupt, which means the stockholders would lose their investments in bankrupt institutions, and have the government put them through a bankruptcy process during which the bad debts would be worked out, written down, etc. And then set the banks back up as going concerns. It worked out much better for Iceland.

Aljazeera's People & Power show featured an analysis of the Irish situation in Collapse of the Celtic Tiger YouTube date 01/19/2012:

Tags: ireland

More help for eurozone countries: Angie says, "Nein!"

2012-01-19T09:25:00.000-08:00

Not that it's a big surprise. But German Chancellor Angela Merkel opposes Germany to kicking in more money to rescue eurozone countries from bankruptcy. (Merkel gegen deutsche Mehrbelastung in Euro-Krise Welt Online 18.01.2012)

This euro crisis has a sickening feeling of rushing toward destruction with everybody knowing it but no one able to imagine changing course.

But it is still a mystery why that would be so. Going back to what John Kenneth Galbraith said about the decisions that led up to the First World War, it's often easy to overlook the effects of just plain stupidity. Cupidity plays a role, for sure. In this case, the European banks persuaded Angie and French President Nicolas Sarkozy to perform a backdoor public bailout for the banks on the hook for Greek debt and the credit default swaps linked to them via public subsidies for Greece to stave off the default that should have happened no later than 2009.

I do think Merkel's own adherence to the very conservative "ordoliberalism" economic doctrine is a major factor. Faced with the obvious failure of her austerity policies, the refusal of Britain to even consider the latest treaty change being proposed, the worsening debt position of every country that has taken her preferred austerity route, the increase in social distress (to the point of a possible humanitarian crisis in Greece), high unemployment, and now a new recession that is affecting Germany, as well.

Yet she's not changing course. She's doubling down on austerity economics. And even if her chosen course were working better than it is, her option still required Germany to be ready to pay more for bailouts to debtor countries, bailouts that are effectively backdoor bailouts for private banks.

Here is one way her past up until age 35 in East Germany may be working against her. She probably doesn't have the depth of intellectual or emotional commitment that political leaders who spent their lives in politics in the western German states acquired.

Merkel is not the only European leader responsible for the impending crack-up of the euro and the European Union. Sarkozy and British Prime Minister David Cameron also bear nearly as a great a responsibility. But Angie's name is all over this mess. And she doesn't give any outward sign that she's on the verge of going down in history as the leader who did the most to wreck the European Union.

Tags: angela merkel, eu, euro, european union

European austerity FAIL

2012-01-19T09:24:00.000-08:00

"Rarely has policymaking been this poor," says Jeff Madrick in How Austerity Is Killing Europe NYR Blog 01/06/2012. The policy in question is Angie-nomics, the insistence on austerity policies during a depression on which German Chancellor Angela Merkel has so far successfully insisted. "This is disaster," he writes. And he's right to use the present tense.

We are seeing in real time the effects of austerity economics, and the experience applies to the United States as well as Europe:

Indeed, austerity economics has not worked in one single case in Europe in the last two years. When David Cameron’s government imposed a first round of harsh spending cuts in 2010, it utterly failed to revive the British economy as promised. To the contrary, it probably cut a budding recovery short. Unemployment and the deficit as a percent of GDP remained high. Some pro-Conservative observers I met at the time assured me that the Cameron team, led by George Osborne, the Chancellor of the Exchequer, was pragmatic and would reverse course on austerity if it wasn’t working. Yet when growth basically ground to a halt in late 2011, the Cameron team only doubled down, making further cuts. We need more of the same medicine, they told their citizens, a record number of whom are unemployed. Britian [sic] is a hair’s breadth away from outright recession only two years after its last one.

In November, meanwhile, Spaniards voted out of office a once-popular Socialist government, in part for its failed austerity program of the past year. The Socialists had earlier presided over a boom and even built a budget surplus. But then the housing and banking crises struck and private Spanish banks ran amok. In response, in 2010 the Socialists sharply reversed an earlier stimulus policy, cut spending, and raised taxes to the tune of about 5 percent of GDP. Government debt is still not high in Spain, and interest rates have not risen the way they have in Italy. But economic growth stalled after these measures were implemented, because reduced public spending weakened the demand for goods and services, pure and simple. With Spain’s official unemployment rate now 21.5 percent, the Socialists lost the election badly—paradoxically pushing voters to elect a conservative leadership that is calling for more austerity. In Spain, recession is now inevitable. [my emphasis]

There are certainly true believers in the doctrines justifying austerity economics. Angela Merkel probably is. But one-percenters also see austerity policies as a way to weaken unions, undermine social supports for working families, lower wages, roll back pensions and gain more leeway from necessary but annoying regulations.

But, you may have heard, austerity worked in Ireland! Well, no:

The recent experience of this once booming country should be deeply embarrassing to those who advocate austerity economics. For six months early last year, its national income started growing again after a couple of years of dramatic collapse following its own financial crisis. Ireland guaranteed all the debt of its over-aggressive failing banks to appease investors and then paid for it by cutting social spending sharply. Ireland’s leaders said with almost religious authority that this painful self-discipline was necessary to right the economy, and officials in Ireland and across Europe hailed the country’s brief rebound in 2011 as proof that it works. But then the Irish economy plunged in the third quarter of 2011 at its fastest rate ever. The upturn in the economy proved only temporary under the restraints of austerity economics. It may yet need another bailout.

Madrick cites the measures that could save the euro - we probably should say now, could have saved the euro - but that will not be adopted: making the eurozone into a true fiscal and transfer union; having the European Central Bank act as buyer of last resort for eurozone sovereign debt; and, creation of Eurobonds based on the credit of the entire eurozone but available to use for any country.

The December EU summit was probably the last chance to make a push for such measures in a timely enough manner to bail out the situation. The drama isn't over until it's over. But it's hard to see this plot playing out to a happy ending for the euro and the European Union.

Tags: angela merkel, eu, euro, european union

What makes Angie tick? (4 of 4): Angie's approach to political loyalty

2012-01-19T08:00:00.000-08:00

Harry Truman once commented that if someone in politics in Washington wants a friend, they should get a dog. Because even among like-minded partisans, politics is a competitive business with constantly shifting alliances.

Angela Merkel would understand the sentiment. Though Truman's comment implies regret, and Angie doesn't show a lot of evidence of being burdened by regrets. Even in a profession known for flexible loyalties, Angie has a reputation of being particularly ruthless in swapping them out when it looks advantageous to her political career.

Perhaps the most dramatic incidence of this was in 1999, when Angela Merkel was the General Secretary of the Christian Democratic Union (CDU), the second-highest party organizational office behind the then Party Chairman Wolfgang Schäuble. Former Chancellor and CDU head Helmut Kohl, her most important mentor in politics, had gotten in trouble over the use of a Party slush fund, in which Schäuble was eventually implicated. She published a public letter distancing herself from Kohl without notifying Schäuble or Kohl that she was doing so. When Schäuble's role also became public, Angie was well positioned to take his place as Party Chair in 2000, a post she has retained very since. It is widely recognized as a prime example of Angie's willingness to stick a (metaphorical) shiv in even her closest allies and most important benefactors if she sees an advantage from it.

Süddeutsche Zeitung chief editor Kurt Kister reports on what appears to be more-or-less Angie's preferred version of her approach to political loyalty in Merkels Haltung zu Wulffs Affäre.Loyal, weil ihr nichts anderes übrigbleibt 12.01.2012:

Merkel ist gegenüber Mitarbeitern, Ministern und Parteifreunden loyal, wenn die ihre Jobs gut machen oder zumindest dies im Rahmen ihrer Möglichkeiten versuchen. Wer so handelt, kann sich auf Merkel verlassen. Professionalität ist der Kanzlerin wichtiger, als es ihr Parteiprogramme oder Linientreue sind.

Wenn Merkel jemanden für eine Position auswählt - und das hat sie im Falle Wulffs getan -, dann erwartet sie, dass der vorher befragte Kandidat die Aufgabe, die er sich und sie ihm zutraut, auch erfüllen kann. Christian Wulff hat sich erschreckend unprofessionell verhalten - von der Kreditverschleierungsgeschichte über den Anrufbeantworter bis zu folgenlosen Ankündigungen im Fernsehen. Er hat seit Mitte Dezember die Sache nicht besser, sondern schlimmer gemacht.

Ginge es nicht um den Bundespräsidenten, drohte Wulff von Seiten Merkels jetzt das Schicksal jener CDU-Männer, die nicht konnten, was sie sollten oder die Merkel im Weg waren. Weil aber Wulff der Präsident ist und selbst immer noch findet, dass er kann, was er soll, wird Merkel sich von ihm nicht weiter entfernen, als sie dies bereits getan hat.

[Merkel is loyal to co-workers, ministers and Party friends if they do their jobs well or at least attempt to do so within the limits of their possibilities. Whoever does that can count on Merkel. Professionalism is more important to the Chancellor than her Party program or loyalty to Party lines.

When Merkel selects someone for a position - and she did that in Wulff's case - then she expects that the candidate to also be able to carry out the duty that he and she agreed upon beforehand. Christian Wulff has conducted himself terribly unprofessionally - from the concealment of the credit story to the answering machine to the unfulfilled promises on television. {All aspects of the current scandal in which he is involved.} Since the middle of December he has not improved the situation but rather made it worse.

If he weren't the Federal President, Wulff would be threatened with the fate of those CDU men who couldn't do what they should or were in Merkel's way. But because Wulff is the President and still holds that he can do what he should, Merkel will not distance herself from him further than she already has.]

But as one of her closest allies, Wulff knows very well that Angie's loyalties can be very flexible.

Sources on Angie's life and career:

Gerd Langguth, Angela Merkel.Aufstieg zur Macht - Biographie(DTV; München) 2007 edition
Michael Lümann, Der Osten im Westen - oder: Wie viel DDR steckt in Angela Merkel, Matthias Platzeck und Wolfgang Thierse? Versuch einer Kollektivbiographie (ibidem-Verlag; Stuttgart) 2010
Angela Merkel, Mein Weg.Angela Merkel im Gespräch mit Hug Müller-Vogg (Hoffmann und Campe; Hamburg) 2004
Volker Resing, Angela Merkel.Die Protestantin - Ein Portrait (St. Benno-Verlag; Leipzig) 2009

Tags: angela merkel

Barry Eichengreen's summary of the euro crisis

2012-01-18T20:42:00.000-08:00

Economist Barry Eichengreen gives a good summary description of the current euro crisis in the print edition of the Jan/Feb 2012 Foreign Affairs, "When Currencies Collapse: Will We Replay the 1930s or the 1970s?":

The eurozone is divided into a relatively vigorous northern tier with sound finances and a southern one with crushing debts and nonexistent growth prospects. Europe's indebtedness is no greater than the United States', but unlike the United States, Europe has no federal fiscal system to transfer resources from prosperous to troubled regions - and European leaders seem unwilling to create one. At the same time, they are hesitant to write down unsustainable debts for fear of destabilizing the banks that hold them. [my emphasis]

The bolded portion is what the financial jargon of "transfer union" means. Ironically, the transfer of income in the US "transfer union" geographically is largely from richer "blue" states like California and New York to "red" states like Mississippi and Alabama, where majorities of the voters elect representatives who want to cut back on transfers!

The result is that southern Europe has been left to implement brutal fiscal cuts that are pushing its economies deeper into recession, further impairing their capacity to service their debts. Many southern Europeans, suffering severe hardship, have rebelled against their own governments and accused northern Europe of sacrificing their well-being. Many northern Europeans, meanwhile, see their southern neighbors as spendthrift, lazy, and corrupt. Those northerners have become increasingly vocal in saying so and have concluded that more rescue operations would amount to pouring money down a rat hole. [my emphasis]

The all-round destructiveness of this cycle is hard to overstate.

Tags: barry eichengreen, eu, euro, european union

What makes Angie tick? (3 of 6) Angie's embrace of neoliberalism

2012-01-18T08:00:00.000-08:00

"Angela Merkel pflegt ihren Ruf als Pragmatikerin. Aber hinter dem Pragmatismus verbirgt sich eine handfeste wirtschaftspolitische Ideologie." ("Angela Merkel promotes her reputation as a pragmatist. But behind the pragmatism hides a particular economic-political ideology.") - Jakob Augstein, Die Sparschweinerei Spiegel Online 10.11.2011

In my last post, I focused on Angie's 2004 expression of admiration for Alan Greenspan. Not because she's carrying around a Quotations from Chairman Greenspan book or something. (Or, who knows, maybe she is!) But Uncle Alan's record is a good illustration of the kind of reality-resistant economic thinking that Angie obviously still embraces.

Digging into details of German politics is always a reminder how tricky it can be to try to discuss European politics in terms of American categories of "liberal" and conservative. In European terms, present-day liberals are the advocates of something like classical historical liberalism in foreign policy, e.g., deregulation of business, hostility to government income-support programs, hostility to organized labor - what passes for "free market" policies in the US. But European liberals often are strong advocates for civil liberties and individual choice in matters like abortion and same-sex marriage; the ones who don't care about that aspect are known as rightwing liberals, a concept that just doesn't compute in conventional American terms.

Angie's "ordoliberalism" emphasizes the need for a strong state, so you won't hear Angie talking about the need to drown government in the bathtub, or that all economic problems are caused by government, as one hears with American Republicans. But she's down with the program that would be familiar as the 1% prescription for economic policy in the US or Britain: lower pensions, later retirement, lower wages, weaker unions, less adequate unemployment insurance, more expensive and lower quality health care combined with bailouts for giant corporations and banks that get in trouble.

The latter concern is how Angie-nomics turned a crisis of the European banks into a massive sovereign debt crisis and now a existential crisis for the European Union. When it became generally apparent that Greece was overborrowed and was not going to be able to pay back the full principal on its sovereign debt, Angie and her junior partner Nicolas Sarkozy, the "Merkozy" duo, wanted to avoid the bank losses that major German and French banks were likely to take if Greece defaulted. So they instead tried to maintain Greece's payments to their creditors by EU subsidies.

But here's where Angie's truth faith in ordoliberal economics showed its destructive face. To justify the subsidies to Greece (which were really backdoor bailouts to banks), Angie and Nick insisted that Greece adopt austerity policies that applied the ordoliberal (and also neoliberal) menu of lower pensions, later retirement, lower wages, weaker unions, less adequate unemployment insurance, more expensive and lower quality health care. This had the entirely predictable effect to anyone familiar with basic macroeconomics (as Paul Krugman ruefully insists in his criticism of austerity policies during this depression) of shrinking the Greek GDP, which make their GDP-to-debt ratio worse, which made them less able to pay the debt, which required more subsidies, for which Merkozy insisted they implement more austerity economics, and so on.

Then bond speculators went after other countries that were not overborrowed by any half-reasonable historical definition before the economic crisis: Italy, Ireland, Portugal, Spain. Ireland had increased its own vulnerability by its government's own unwillingness to force bank stockholders to eat the consequences of private banks' own bad debts, and therefore assumed large amounts of substandard bank loan liability, which increased their vulnerability to bond speculation attacks.

If the "trioka" of the EU, the European Central Bank and the IMF had broken from one-percenter orthodoxy in 2009 and allowed Greece to write down a large portion of its debt and not insisted on self-destructive austerity policies, it's highly possible that the current euro and EU crisis could have been avoided. Or at least postponed until adjustments could be made to remove the hard-money trap that the euro currency constitutes for the less robust European economies.

It's a staggering failure of European governing elites that matters came to this point. Within the EU, the longer-term leadership failure should be especially laid on Britain, France and Germany, whose leadership was absolutely vital to the growth and development of the EU. The fact that Norway and Switzerland passed on EU membership wasn't vital to the European project. But the leadership of the three leading powers was essential.

Angie's role does have its own significance, however, because as leader of the country with the largest GDP of the EU and the eurozone, Germany's financial resources inevitable gave it a great deal of clout in the current situation. A more pragmatic approach by Merkel's government could have produced a far better result.

Which tells me that Angie's understanding of economics really is heavily ideological, and that she really is committed to her ordoliberalism. Some of her policies don't fit into a pure ideological picture. She has supported tax cuts for the wealthy in the past, for instance. But now one of the big issues in her governing coalition is that she opposes tax reductions for the wealthy right now while the junior coalition partner, the Free Democrats (FDP), favor them. Here, concern for a balanced budget and a belief in the importance of such fiscal rectitude probably do override ideological preferences for the comfort of the most comfortable. In Keynesian terms for Germany itself, they haven't needed a big injection of stimulus the last couple of years, so her policy would be consistent with that. But the eurozone definitely has needed stimulus, and badly, so Keynesian considerations would have said that Germany should be borrowing more to provide stimulus to weaker economies like that of Greece and Portugal.

The traditional approach of the Christian Democratic Union (CDU) and its Bavarian ally the Christian Social Union (CSU) have combined a paternalistic concern for social welfare functions with a solicitude for the comfort and convenience of the wealthy. That combination, along with the "C" part of the party names which primarily meant a close alliance with the Catholic hierarchy, has defined the CDU/CSU brand of conservatism as it is know in Germany. The CDU has a labor union wing, though its influence has notably declined in recent years. There is a German description of "Christian unions", which go back to the earlier days of the labor movement when they provided an alternative to the socialist-led unions. A century ago, the Christian unions may have rejected the seizure of the means of production then still theoretically advocated by the Social Democratic Party (SPD). But they have provided a real base of support for public pension programs and other policies that benefited labor and the consumers within the CDU.

Angie famously embraced the less paternalistic neoliberal view at the CDU's Leipzig convention in 2003. Then General Secretary of the Party, since succeeded in persuading the convention to adopt a program that embraced more of her ordoliberalism, particular more aggressive policies on business deregulation and the rollback of social benefits to workers. And she was able to unite the CDU behind that approach from then until today.

She frames her anti-labor positions in terms of individual freedom, the need to enhance competitiveness, and the challenges of globalization and technological change. Merkel biographer and political scientist Gerd Langguth places particular significance on the framing of her approach in a speech she gave October, 2003, called "Quo vadis Deutschland" in which she discussed freedom, solidarity and justice as basic values of German and CDU politics:

Unser Gemeinwesen braucht eine Neujustierung dieser drei Werte in ihrem Verhältnis zueinander, und zwar zugunsten der Freiheit. Oder anders gesagt: Damit Solidarität und Gerechtigkiet wieder gelebt werden können, muss die Freiheit in unserer Wertehierarchie wieder deutlich von unten nach oben kommen.

In Langguth's view, "Hier handelt es sich um das eigentliche Credo der CDU-Vorsitzenden."

In other words, in Angie's view Germany had too much solidarity and justice, and needed to balance them with more individual freedom, which in her ordoliberal outlook means lower pensions, later retirement, lower wages, weaker unions, less adequate unemployment insurance, more expensive and lower quality health care combined with bailouts for giant corporations and banks that get in trouble.

Her statement in her book Mein Weg in 2004, quoted in the firsts post in this series, is striking in that she not only compares ordinary Germans unfavorably with Americans, but does so by sneering at the childishness of anyone who doesn't admire the American approach, which even the European business has been known to call killer capitalism: "What does the German do" in the face of economic change, she asks. "First he gets depressed and thinks, may the state is a more secure harbor - like a little child who falls down on his first attempt to walk and then would rather just lie there than to hurt himself again."

Whether she personally believes such policies actually enhance individual freedom for anyone but the 1%, who get more freedom to accumulate wealth, exploit their workers and cheat their customers and business partners under the ordoliberal approach. But if we understand Langguth's statement to mean that Angie's committed to the policies she sees as enhancing freedom, then her career since 2003 provides plenty of evidence that it really is her "true creed". One can look at the results of Angie-nomics in Greece, Ireland, Portugal and Spain to evaluate how much weight solidarity and justice have in her real existing system of values. The Portuguese Prime Minister Pedro Passos Coelho recently suggested that people who can't find a decent job in Portugal should just move out of the country to Angola or Brazil where Portuguese is also spoken. (Mario Queiroz, No Jobs? Just Emigrate! Inter Press Service 12/29/2011)

So the 99% in Angie-nomics do have the freedom to become economic refugees.

Sources on Angie's life and career:

Gerd Langguth, Angela Merkel.Aufstieg zur Macht - Biographie(DTV; München) 2007 edition
Michael Lümann, Der Osten im Westen - oder: Wie viel DDR steckt in Angela Merkel, Matthias Platzeck und Wolfgang Thierse? Versuch einer Kollektivbiographie (ibidem-Verlag; Stuttgart) 2010
Angela Merkel, Mein Weg.Angela Merkel im Gespräch mit Hug Müller-Vogg (Hoffmann und Campe; Hamburg) 2004
Volker Resing, Angela Merkel.Die Protestantin - Ein Portrait (St. Benno-Verlag; Leipzig) 2009

Tags: angela merkel

Monday's South Carolina Republican debate

2012-01-18T06:01:00.000-08:00

Monday's Republican Presidential debate in Myrtle Beach, South Carolina was a genuine horror show. Where to begin.

Well, there was Newt Gingrich calling on Andrew Jackson to support his own warmongering foreign policy. He's lucky his tongue didn't burst into flames on the spot. If he had gone on to quote William Faulkner to support some point or other of his, I would have just hurled right onto the screen. That deserves a whole separate post.

Then there was Gov. Goodhair Perry defending those Marines recently in the news for peeing on the freshly-killed corpses in Afghanistan (Josh Voorhees, Charges Against Urinating Marines Expected Soon The Slatest 01/13/2012), starting around 2:05 in this video:

I just have no patience with this stuff. People who defend war crimes are defending and promoting crime. Some liberals/progressive have understandably tried to use this to point out that wars invariably produce atrocities, particular wars like Afghanistan and Iraq that put the occupying soldiers in atrocity-producing situations, as the psychiatrist Robert Jay Lifton calls them. "This is a war," writes Allison Hantschel in In Defense of Dana Loesch Firedoglake 01/16/2012. Readers can judge for themselves whether she winds up diminishing the serious of such an incident.

But that is no excuse or alibi for war crimes, including desecration of corpses. Laws of war and rules of engagement are there for good reasons: to put limits on the violence of war; to maintain command authority - things like torturing prisoners and desecrating corpses can have major effects on the mission; and to keep soldiers from coming back from war as murderers and violent criminals. The fact that Goodhair defended the desecration shows how little he respects common decency, much less the law. Most of our soldiers aren't out there peeing on corpses. By defending those who do, he puts them on a level with the soldiers who don't commit war crimes.

At 4:45 in that same video clip, Gingrich starts on his statement that leads up to the Andrew Jackson comment at around 6:15.

Goodhair talked segregationist starting around 2:25 in this video, and Newt picks it up around 7:30 in his discussion of unemployment insurance:

Goodhair in that segment says, among other trash, that the State of South Carolina is "at war" with the federal government, and we SC Gov. Nicky Haley laughing and applauding for it. Since any post on a Republican debate just seems to be missing something if there's not a Charlie Pierce quote included: "South Carolina really isn't the place where you want to make loose talk about being 'at war' with the federal government. Honestly, Governor Goodhair, why don't you just go down to the harbor, throw a rock at Fort Sumter, and make it official?" (The Great Nominating Show Is Nearly Over Esquire Politics Blog 01/17/2012)

Willard Romney does his xenophobic anti-immigrant thing in this clip around 3:00.

That clip also includes the part that got a lot of attention, Gingrich going off on FOX News' Juan Williams at around 9:40.

Charlie Pierce again:

I harbor no sympathy for Williams, who's spent the last two years pretending to be the innocent victim of those jackbooted thugs at NPR — from which, full disclosure, I draw the occasional paycheck — while cashing checks for Fox and writing self-indulgent books that few people read and even fewer people believed. So, when Williams suddenly turned into the Defender of Black People in the debate, everything he'd done in the previous couple of years laboring in the snake-infested vineyards of Roger Ailes should have prepared him for the moment when Gingrich decided to throw 40 years of politically profitable conservative white backlash back in his teeth. For this, the very white Gingrich got a standing ovation from the very white audience for yelling at the very non-white Williams, and if you think the ovation was for Gingrich's stalwart advocacy of the I-73 project, you haven't been paying attention since 1865.

Digby uses that exchange between Williams and Gingrich to analyze the way in which white racism is becoming more and more explicit in the Republican Party. (Straight up racism, no dogwhistle necessary Hullabaloo 01/17/2012)

In this clip, this clip at around 2:05 Gingrich recommends Chile's social security program put in place during the Pinochet dictatorship.

And this one of the last part of the debate has a weird discussion touching on the corrupt bizarreness generated by the Citizen's United decision.

Tags: republican party, war crimes, white racism

Climate change denial

2012-01-17T08:53:00.000-08:00

The Bulletin of the Atomic Scientists has been running a number of articles recently dealing with science denial. Steven Cohen and Alison Miller, both of the Columbia Earth Institute, write in Climate change 2011: A status report on US policy Jan/Feb 2012 about the partisan divide on climate change science:

It is impossible to deny or ignore the growing partisan divide that has profoundly influenced the US climate debate, making it more polarized even as climate science has become more definitive. Last year, a Gallup poll found that in 2010, only 30 percent of self-identified Republicans believed the effects of global warming were already beginning, a drop from almost 50 percent in 2007. The percentage of convinced Democrats, however, remained at 70 percent or higher during the same period, according to Gallup. A Pew Research Center poll in October 2010 found similar results highlighting the partisan divide, reporting a 40 percentage point difference between Republicans and Democrats believing evidence that the Earth is warming (Marshall, 2010).

The demographics within the Republican Party on climate science denial are particularly interesting:

The division remains even after factoring in education. A 2011 study found that, among Democrats and liberals, levels of education had a strong correlation with not only a belief in climate science, but with individual concern about global warming; however, that same study found the opposite effect in the case of Republicans and conservatives (Hoffman, 2011). This persistent gap suggests that climate change has become an ideological issue - much like gun control, taxes, or regulation - that defines what it means to be a Republican or Democrat (Nisbet, 2009). The US divide over climate change involves more than just an understanding of climate science. [my emphasis]

It's become a "tribal" issue, in other words, a psychological identifier.

But "education" in such surveys can be misleading. Because education also correlates with higher income on the average. This could also suggest that the more affluent Republicans are more willing than working class voters in the Republican base to disregard the dangers of climate change, which wouldn't be surprising. Because money talks, and the climate science denial position is virtually all money talking:

The fossil fuel industry has caused much of the political division on climate change through aggressive action to promote skepticism among the public; the industry, typically through conservative think tanks, has funded opposing scientific opinions, economic reports, and public relations campaigns. For example, in 2005 Chris Mooney of Mother Jones found 40 ExxonMobil-funded organizations that either sought to undermine mainstream scientific findings on climate change or maintained affiliations with a small group of skeptic scientists (Mooney, 2005). Furthermore, some climate scientists may have contributed to the political divide by moving past their knowledge of climate change to predict socioeconomic impacts and propose policy solutions that go beyond the scope of climate data and models. This combination of science, policy, and advocacy can undermine non-expert confidence in climate science.

And, in typical authoritarian projection, climate science deniers argue that scientists who do study climate change are mostly corrupted by the pursuit of grant money, which they apparently supposed flows from the fount of what they call Political Correctness, by which they mean stuff they think is politically incorrect. (No wonder they get confused!)

Conservatives opposing anti-pollution regulations have always argued that they represented more gubment regulation that allegedly hurts the economy. Climate science denial is their tool for working concern over global climate change into that long-established partisan and ideological framework:

But it seems climate skeptics are concerned about the validity of climate change mostly because of its implications for regulation of business. The effort to regulate greenhouse gases would eventually entail some level of government regulation of many aspects of daily life, from the cars Americans drive to the electricity that powers their homes and businesses. Those who are wary of big government dislike this potential intrusion.

Critics of climate regulation argue that it will pose an impossible burden on businesses and stifle a weak economy through higher energy prices. At least in the Republican Party, political dialogue throughout 2011 was dominated by the message that government wastes money and takes on duties that should be left to the private sector. Emboldened by electoral gains in 2010, conservatives and Tea Partiers continue to emphasize that government is the problem and an unregulated free market is the solution.

Since more affluent/better educated Republicans tend to give more emphasis to such economic concerns than to the "values issues" like abortion and general hostility to women's rights, that's consistent with the poll findings that better educated Republican are hotter for climate science denial. (Bad pun, I know ...)

Tags: global climate change, science denial

What makes Angela Merkel tick? (2 of 6): Merkel and Greenspan

2012-01-17T08:00:00.000-08:00

In the first post in this series, we saw Angie in 2004 expressing her great admiration for Ayn Rand discipline and then-chairman of the US Federal Reserve. She classified him among the "leading thinkers" of the US.

Alan Greenspan, the Maestro of neoliberalism/deregulation/the Washington Consensus

Uncle Alan was regarded as something like a demigod by the Very Serious People in the US. And obviously by Angie, as well. Bob Woodward wrote a book on him titled Maestro. Even after the tech bubble burst in 2000 and shook confidence in the awesomeness of the stock market, the idolization of Uncle Alan continued. The one time I heard popular financial adviser Susie Orman speak live and in person, she advised her listeners that Uncle Alan as head of the Fed determined what would happen with inflation.

This adulation is partially because of a well-established habit of largely magical thinking about the arcane powers of the Federal Reserve. The late John Kenneth Galbraith was sharply critical of this attitude toward the Fed and its director. In his last book published during his lifetime, The Economics of Innocent Fraud (2004) he explained, "The false and favorable reputation of the Federal Reserve has a strong foundation: There is the power and prestige of banks and bankers and the magic accorded to money. These stand behind and support the Federal Reserve and its member - that is, belonging - banks." Galbraith regarded this high opinion of the Fed and its chairman of any given moment as "our most implausible and most cherished escape from reality" in economics.

Angie has shown a sometimes ruthless pragmatism in her political career in making allies and dumping them, even sticking in the metaphorical shiv when she thought it was to her advantage. I doubt she would express such admiration for Uncle Alan now that events and lack of the Fed Chairman's title have reduced his image to something a little close to that of the dogmatic hack he always was.

But her actions in the euro crisis, and the European banking crisis that always was and still is the core problem behind the euro crisis, show that she maintains her faith in the arcane magic of which Uncle Alan was the High Priest in the United States in 2004.

Greenspan's irresponsible service to the one-percenters, more specifically to financial institutions hawking mortgages, had real consequences for real people:

Galbraith the Younger, Jamie Galbraith, wrote in The Predator State (2008):

Lenders knew, as borrowers did not, that in the wake of 9/11 [2001], short-term rates were unprecedentedly low, and these conditions would not endure. They therefore deliberately substituted adjustable-rate mortgages for fixed-rate mortgages - with the endorsement of then Federal Reserve chairman Alan Greenspan, to reassure the naive public that the exercise was sound. Interest rates then rose, the mortgages started to reset, and hundred of thousands of homeowners found themselves unable to meet the required payments. Moreover, they had no prospect of rapidly increasing their incomes in order to meet their rapidly rising bills. By the late summer of 2007, new foreclosure mortgages were approaching the total number of persons permanently displaced from New Orleans by Hurricane Katrina every month. [my emphasis]

William Black takes a look at the destructive legacy of Uncle Alan in The continuing saga of bank self-regulation and other fairy tales featuring Alan Greenspan Credit Writedowns 01/12/2012. He reminds us of some of the highlights of the Maestro's financial statesmanship:

He supported the repeal of the Glass-Steagall Act despite the conflict of interest inherent in combining commercial and investment banking. He supported the passage of the Commodities Futures Modernization Act of 2000 despite agency conflicts between managers and owners of firms purchasing and selling credit default swaps (CDS).

He opposed using the Fed’s unique statutory authority under HOEPA (1994) to regulate ban fraudulent liar’s loans by entities not regulated by the Federal government. He opposed efforts to clean up outside auditors’ conflict of interest in serving as auditor and consultant to clients. He opposed efforts to clean up the acute agency conflicts of interest caused by modern executive compensation. He opposed taking an effective response to the large banks acting on their perverse conflicts of interest to aid and abet Enron’s SPV frauds.

Black also unpacks a example of the typical pretzel logic of Ayn Rand enthusiasts. Though Uncle Alan formulated it in a less accessible fashion than more credulous disciples, in his argument about how unregulated cutthroat competition produces honesty among business executives. Black boils Uncle Alan's argument down to its ridiculous essentials: "Markets force CEOs to act as if they were honest because a good reputation is essential to the CEO."

He also reminds us of this biographical detail from the glorious Reagan years: "Greenspan was Charles Keating’s principal economic expert and had seen him loot Lincoln Savings in the late 1980s."

The most fatuous part of Angie's 2004 praise for Uncle Alan is her admiration at how he had learned from the tech bubble of the 90s and would therefore prevent such a thing from happening again. Uncle Alan believed that the need for a CEO to have a good reputation was vital to his company's ability to borrow money in the bond market, and therefore the need to borrow would act as an antidote to the temptation to commit accounting fraud. As Black explains:

In any analogous context we would consider Greenspan’s “antidote” claim to be facially insane. If the head of the public health service announced proudly that the service had triumphed because, while one million Americans had died of an epidemic of cholera, the death rate had been so severe and rapid that the epidemic had burned out, we would consider him to be delusional and heartless. The death of the pathogen’s host (us) does not constitute a triumph over cholera. It also does not leave the survivors who were not exposed to the pathogen with additional antibodies that will prevent future epidemics.

Angie may not be running around citing her admiration of Uncle Alan these days. But she's following his example in pursuing a clearly disastrous course.

If we look at the real consequences for the 99% in countries currently suffering from Angie's EU-imposed austerity policies in Ireland, Greece, Portugal and Spain, we can see that Angie is a worthy disciple of that Leading Thinker and Very Serious Person Alan Greenspan, the maestro, the financial demigod.

In practice, it matters little whether Angie really believes the vapid ideology and magical thinking behind her "ordoliberal" economics or whether it's cynical service to the one-percenters. I would guess that there's actually a lot of the first at work, though it's also clear that she knows her policies are directed at comforting the most comfortable. Her words in 2004 on economic policy are consistent with her later policies, up to and including her current EU austerity drive.

Sources on Angie's life and career:

Gerd Langguth, Angela Merkel.Aufstieg zur Macht - Biographie(DTV; München) 2007 edition
Michael Lümann, Der Osten im Westen - oder: Wie viel DDR steckt in Angela Merkel, Matthias Platzeck und Wolfgang Thierse? Versuch einer Kollektivbiographie (ibidem-Verlag; Stuttgart) 2010
Angela Merkel, Mein Weg.Angela Merkel im Gespräch mit Hug Müller-Vogg (Hoffmann und Campe; Hamburg) 2004
Volker Resing, Angela Merkel.Die Protestantin - Ein Portrait (St. Benno-Verlag; Leipzig) 2009

Tags: alan greenspan, angela merkel, austerity economics, james galbraith, john kenneth galbraith, ordoliberalism

Boy, I'm glad the Republicans don't promote white racism or anything

2012-01-17T06:23:00.000-08:00

Jon Wood, Newt Gingrich Seeks South Carolina Boost From Racially Charged Exchange With Juan Williams Huffington Post 01/17/2012

Tags: newt gingrich, republican party, white racism

What makes Angela Merkel tick? (1 of 6) Angie and ordoliberalism

2012-01-16T08:00:00.000-08:00

"Was man wann riskiert, kann man erst sagen, wenn eine solche Situation eingetreten ist." ("What one will risk and when, one can only say when such a situation presents itself.") - Angela Merkel, Mein Weg.Angela Merkel im Gespräch mit Hugo Müller-Vogg (2004)

German Chancellor Angela Merkel is clearly deeply committed to her conservative, at-least-semi-authoritarian version of economics. Bloomberg Businessweek's Peter Coy was perceptive in his article , Will Angela Merkel Act, or Won't She? 11/30/2011 in noting Angie's strong identification with "ordoliberalism", also known as "Ordnungsökonomik". Coy noted that it was "a conceptual blend of free markets and strong government." And, "Sound money is the polestar of the ordoliberal tradition."

That's a good summary of Angie's position. And she was willing to risk the break with Britain that occurred at the December EU summit in order to impose it on all the countires of the eurozone and as much of the rest of the EU as possible.

The serious authoritarian trend in EU member Hungary, which has put them in a situation that they wouldn't qualify for EU membership if they were applying today, doesn't much seem to bother her. She's much more interested in seeing Hungary join the permanent austerity club by approving constitutional changes via treaty obligation that would effectively give Angie the final say on their budget, along with every other EU country except Britain, which already refused to play ball. (Prime Minister David Cameron handled that situation as recklessly as Angie has been acting, but that's another story.)

Angie's 2004 book Mein Weg, structured as a set of interviews with an obviously very sympathetic interviewer, is a major source of biographical information on her. Though obviously no good biographer is going to simply take her word on all the factual claims. Even honest memory can be a tricky thing.

In it, she makes very clear her commitment to her ordoliberal economic conceptions, which mostly sound like a dreary list of the items in the neoliberal/Washington Consensus/globalization/one-percenter recipe: lower pensions, later retirement, lower wages, weaken unions, less adequate unemployment insurance, more expensive and lower quality health care. All this for das Volk, of course, but certainly not for the one-percenters, which she at least doesn't call "job creators" there.

But she might as well have, because she justifies it all on the grounds of globalization, competitiveness, faster growth, technological change, etc., etc. Nothing terribly original there. But it is interesting to see how in her career since she's been so committed to that perspective, mostly drasticly in driving the EU toward the cliff with the pedal to the medal.

This, however, is quite revealing:

Hier konnen wir von den Amerikanern lernen. Der Amerikaner sagt: »Ich muss mir das Prinzip anschauen. Ich habe ganz offensichtlich neue Verhältnisse und brauche neue Spielregeln.« Was macht der Deutsche? Der ist erst einmal deprimiert und denkt, vielleicht ist der Staat doch der sichere Hafen - wie ein Kleinkind, das bei den ersten Gehversuchen fällt und dann lieber liegen bleibt, als sich nochmals weh zu tun. Völlig falsch! Wenn man Alan Greenspan und anderen amerikanischen Vordenkern zuhört, dann beschreiben sie einem mit leuchtenden Augen, wie sie aus diesen Fehlern gelernt haben und dass ihnen so ein Debakel wie bei den Technologie-Aktien nie wieder passieren wird. So muss die Antwort ausfallen. Deshalb ist jetzt auch die Diskussion um »corporate governance« so wichtig: Wie sorgen wir fur Transparenz an den Aktienmärkten, wie ist die Beziehung yon Aufsichtsraten zu Vorständen? In der Informationsgesellschaft kann nicht mehr nach den Regeln der alten Industriegesellschaft gespielt werden. Aber deshalb auf das Spiel zu verzichten ware die völlig falsche Schlussfolgerung.

[Here we can learn from the Americans. The American says: "I must look at the principle. I very clearly have a new situation and I need new rules of the game." What does the German do? First he gets depressed and thinks, may the state is a more secure harbor - like a little child who falls down on his first attempt to walk and then would rather just lie there than to hurt himself again. Completely wrong! If one listens to Alan Greenspan and other leading American thinkers, they describe with clear eyes how that have learned from these mistakes and that such a debacle as with the technology stocks [the 1990s tech boom] will never happen again. That how the answer has to be. That's why the current discussion about "corporate governance" is so important: how do we take care for the transparency of the stock market, what is the relationship of the boards of directors to the CEOs? One can't play in the information society with the rules of the old industrial society. But to refuse to play the game because of that is completely wrong conclusion.] [my emphasis]

I'll unpack this statement further in the next post.

Sources on Angie's life and career:

Gerd Langguth, Angela Merkel.Aufstieg zur Macht - Biographie(DTV; München) 2007 edition
Michael Lümann, Der Osten im Westen - oder: Wie viel DDR steckt in Angela Merkel, Matthias Platzeck und Wolfgang Thierse? Versuch einer Kollektivbiographie (ibidem-Verlag; Stuttgart) 2010
Angela Merkel, Mein Weg.Angela Merkel im Gespräch mit Hug Müller-Vogg (Hoffmann und Campe; Hamburg) 2004
Volker Resing, Angela Merkel.Die Protestantin - Ein Portrait (St. Benno-Verlag; Leipzig) 2009

Tags: angela merkel

New week for the euro crisis, and the Angiebots are grumpy

2012-01-15T15:24:00.000-08:00

"Greece's lesson for policymakers across the world is simple: you can't cut your way back to prosperity." - Larry Elliot

I heard a commentator on Austrian ORF TV say that the euro crisis had take a Christmas vacation.

Now vacation's over. As Heather Stewart explains in Eurozone's fate hangs on whether French humiliation turns to anger The Guardian 01/14/2012:

But this brief hiatus came to a dramatic end on Friday. First, talks in Athens aimed at persuading Greece's creditors to voluntarily accept a writedown on what they are owed stalled, amid rumours that hedge funds – which have insured themselves against the risk of collapse with credit default swaps, and therefore will get a payout in any event – are refusing to join in.

While the markets were still digesting the news of the standoff in Athens, rumours began to emerge that Standard & Poor's was poised to take the axe to the ratings of a string of eurozone countries, including even France. S&P had warned late in 2011, in the runup to the fateful Brussels summit, that it was re-examining most eurozone countries' ratings because it was concerned about their exposure to the sovereign debt crisis and unconvinced by politicians' response.

Then, after the European markets had closed, S&P confirmed that it was, indeed, stripping France of its coveted AAA rating and downgrading another eight countries, from bailed-out Portugal to the island of Malta. Across the eurozone, only Germany, the Netherlands, Finland and Luxembourg now retain S&P's top rating.

The European scene does present one encouraging contrast to the US when it comes to the crooked rating agencies. European leaders are inclined to say, "What the hell do these American rating agencies think they're doing? We need to get some honest and independent rating agencies going."

During the ludicrous fight in the US over the debt ceiling last year, the Republicans acted as though S&P were the voice of God when they downgraded the US credit rating. Real interest rates on US bonds actually went down after the downgrade, something that always comes to my mind immediately now when I hear S&P mentioned. How wrong could they have called the situation.

But did we hear our Democratic President, the one now campaigning as the defender of the 99%, scolding the rating agency for being incompetent and/or crooked? He's far too concerned about not ruffling feathers on Wall Street or the boardrooms to do what conservative and social-democratic leaders in Europe are doing in response to S&P's downgrade of eurozone countries' credit rating. To be fair, the Administration did argue publicly that the downgrade was based on incompetence; they weren't totally silent or completely deferential. But as he normally does, Obama decided to pass on a chance to build public support against abuses by the financial sector, including the rating agencies.

As it turns out, part of the reasons Standard & Poor's is giving for their downgrades is that Angie-nomics, the austerity policies that Princess Angela von Merkel is insisting on during this depression will damage the eurozone economies and thereby make the debt situation worse. Austria's Social Democratic Chancellor Werner Faymann scolded S&P. But he and the Austrian President Heinz Fischer, also a Social Democrat, insisted that the downgrade gives more urgency to Feymann's own Angie-nomics proposal to write a "debt limit" into the Austrian Constitution. It's a dumb idea to begin with and will do nothing to help the euro crisis or Austria's own credit rating.

Part of Austria's current vulnerability is that Austrian banks have a lot of lending to Hungarian companies, and Hungary has its own debt and economic problems to worry about even though they aren't part of the eurozone. And they have a political confrontation with the EU pending due to the seriously authoritarian turn of the current ruling Fidesz Party headed by "kookoo autocratic" President Victor Orbán.

But part of the consideration of all the non-German EU countries here has to be avoiding being the first one to pull the plug on their membership in the eurozone and the EU. The prime candidates for that are still Greece and Italy, with Greece likely to be more in the spotlight this coming week. And one encouraging sign is that, if this report by Carsten Volkery is any indication, Neuer Vertrag.Etatsünder bohren Schlupflöcher in den Euro-Pakt Spiegel Online 15.01.2012, other eurozone countries are balking at the key element in Angie's current power-play, which is her demand that the EU (read: Germany) have veto power over all EU countries' budgets. (The actual language has to do with debt and deficit limits and the mechanism for enforcing them.) Volkery sources his story to two Angiebots, Jörg Asmussen and Elmar Brok. Even though Asmussen is SPD, he supports Angie-nomics and is a toady for the finance lobby. Brok is part of the drafting committee for the new budget treaty Angie is pushing; Brok proudly displays a photo of himself with Angie on his website as of this writing.

Angiebot Elmar Brok with the Princess Angie von Merkel

The two Angiebots are obviously disturbed that the lesser nations aren't bowing to Her Majesty Angie's demands without question. Angiebot Brok is bragging that the Angie's negotiators have succeeded in blocking any provisions that might allow the creation of Eurobonds, bonds backed by the credit of the entire eurozone but available to use for expenses of individual countries. Since if the euro is going to be saved - which seems an unlikely prospect to me - Eurobonds would have to be part of the solution, that's really nothing to brag about. But I'm sure Her Majesty is proud of him for being a faithful Angiebot on the matter.

Angie's Foreign Minister Guido just went down to Greece making them an offer he and Angie presumably think they can't refuse, which is more austerity, more austerity, more austerity. (Westerwelle ermutigt Griechen zu weiteren Reformen Welt Online 15.01.2012) The problem is the same as it was in 2009. Greece has too much debt and it can't repay it all. The EU late last year did agree to ask banks to voluntarily take writedowns on Greek bonds. The voluntary part is important, because investors have insured themselves against losses by the use of the financial derivatives known as credit default swaps (CDS). If the default is technically voluntary on the part of the creditors, the CDSes aren't triggered, i.e., the banks that sold the CDSes aren't on the hook for the payouts. This is part of the worry of why even the default by Greece, which has a small GDP, could trigger a European and world financial crisis. European banks are undercapitalized, and derivatives market is still so poorly regulated that the European and American regulators don't know for sure how large private banks' CDS exposure to eurozone debt is. Once the CDSes start triggering, we could be looking at a "Lehman event", or far worse. (The dialogue at the link has some dopey parts.)

As negotiations get down to the wire on the next tranche of aid to Greece, hedge funds are balking on taking "voluntary" writedowns on Greek debt and therefore forgoing collecting on their CDSes. Guardian economics editor Larry Elliot frames the current situation with melodramatic but descriptive imagery (Eurozone crisis: Troika's gunboats will get their way, at a cost 01/15/2012):

The warships have been replaced by spreadsheets. Back in 1850, Greece knew it was in trouble when the Royal Navy arrived at Piraeus. This time, the pressure comes from banks, hedge funds and the team of officials of the International Monetary Fund (IMF), the European Central Bank (ECB) and the EU, who will take up residence at one of the swankier hotels in Athens.

But his more sober description is also correct: "A three-way game of bluff is currently in progress between the Greek government, the hedge funds and bankers, and the troika (the IMF, the ECB and the EU)."

Bottom line: the European ruling elites are continuing to deal with this crisis with the same level of realism, vision and good sense that their predecessors in 1914 were applying to events of their day.

Tags: angela merkel, austria, eu, euro, greece

Papa Doc Paul and Charles Krauthammer

2012-01-13T22:18:00.000-08:00

We live in a very weird political (and historical?) moment right now. Newt Gingrich is running vivid ads showing some of the ugliest side of American capitalism; he himself is actually saying that rich people shouldn't just take everything.

Not that he means a word of it. Because the fact that he's saying it is bizarre enough in itself.

Then this week, Charles Krauthammer wrote a column that you don't have to be a blithering warmonger or a psychopath to at least partially agree with. He's writing about Ron Paul’s achievement Washington Post 01/12/2012. He's here anointing Papa Doc's Bircherite extremism with a new level of Establishment respectability:

Paul was genuinely delighted with his [showing in the New Hampshire primary], because, after a quarter-century in the wilderness, he's within reach of putting his cherished cause on the map. Libertarianism will have gone from the fringes — those hopeless, pathetic third-party runs — to a position of prominence in a major party.

Look at him now. He's getting prime-time air, interviews everywhere and, most important, respect for defeating every Republican candidate but one. His goal is to make himself leader of the opposition — within the Republican Party.

He is Jesse Jackson of the 1980s, who represented a solid, African American, liberal-activist constituency to which, he insisted, attention had to be paid by the Democratic Party. Or Pat Buchanan (briefly) in 1992, who demanded — and gained — on behalf of social conservatives a significant role at a convention that was supposed to be a simple coronation of the moderate George H.W. Bush.

No one remembers Bush's 1992 acceptance speech. Everyone remembers Buchanan’s fiery and disastrous culture-war address.

At the Democratic conventions, Jackson’s platform demands and speeches drew massive attention, often overshadowing his party’s blander nominees. [my emphasis]

Given Papa Doc's cuddly relationship with anti-Semitic conspiracy theories and groups that indulge in them, Krauthammer's praise is all the more remarkable. Krauthammer is a Jewish neocon to whom the only wrong Israel can do is to not be brutal enough to Palestinians and Arabs. And he's offering Papa Doc a new measure of mainstream respectability?

There don't know where Krauthammer is going with this. But it's obvious that he's ready to welcome Bircher "libertarianism" into the Grand Old Party:

Put aside your own view of libertarianism or of Paul himself. I see libertarianism as an important critique of the Leviathan state, not a governing philosophy. As for Paul himself, I find him a principled, somewhat wacky, highly engaging eccentric. But regardless of my feelings or yours, the plain fact is that Paul is nurturing his movement toward visibility and legitimacy.

Paul is 76. He knows he’ll never enter the promised land. But he's clearing the path for son Rand, his better placed (Senate vs. House), more moderate, more articulate successor. [my emphasis]

Update: In a couple of ways, Krauthammer is provided two of the standard services of Republican partisan columnists. He is recognizing reality, that Papa Doc and his blunt version of segregationist/Bircher politics is a significant force in Republican Party politics. And he's moving the center to the right; if Papa Doc and his constituents are "the opposition — within the Republican Party", then the Newt Gingrichs and Willard Romneys are the moderate wing of the Party. And so the standard for sacred Bipartisanship moves further and further toward the most hardline positions of the Republican Party.

I also suspect that Krauthammer's good words for Papa Doc represents a recognition that Bircher Old Right isolationism really is based on hyper-nationalism and xenophobia. Papa Doc and his followers may see Israel as part of an ongoing plot for world domination by the Elders of Zion. But Papa Doc is against the entire concept of international law, which means he's down with more powerful countries launching preventive wars against less powerful ones. Papa Doc has explicitly said he had no objection to Israel's bombing an alleged nuclear site in Syria, for instance.

Old Right isolationism of the Papa Doc variety may be an annoyance to neocon advocates of a permanent state of war. But they now it's not a serious threat. The nationalism, white racism and xenophobia is more important to its adherents than non-intervention. Pat Buchanan's career illustrates that wonderfully.

Tags: charles krauthammer, republican party, radical right, ron paul

At least Dany Cohn-Bendit hasn't forgotten what the EU is about

2012-01-12T19:56:00.000-08:00

Dany Cohn-Bendit, head of the Green caucus in the European Parliament, was one political leader who pushed the EU to take action against the authoritarian constitutional changes in Hungary under the ruling Fidesz headed by President Victor Orbán .

Hungary's "kookoo autocratic" Victor Orbán with a like-minded leader

"We have a very serious democratic crisis in Hungary," he said.

He describes Orban as a "Hungarian Napoleon" who "sees himself as a little Hungarian Emperor" and as a "kookoo autocratic" leader pursuing "a radical dismantling of democratic atructures." (Ungarns neue Verfassung.Bewerten 13:19.Cohn-Bendit nennt Orban durchgeknallten Autokraten Die Welt 05.01.2012)

Tags: dany cohn-bendit, european+union, hungary, victor orbán

Big civil liberties concerns for the US

2012-01-12T19:29:00.000-08:00

The mainstream press will be flooding the zone from now until November with news about the Presidential race.

Serious civil liberties currently facing the United States are not likely to get much attention in that coverage. But they remain. Here I'm providing some links and brief quotes about four of them: the corporatization of free speech; deporting American citizens; detention without due process; and, torture.

The corporatization of free speech: bmaz in The Corporatist Free Speech Superiority of the Roberts Court Emptywheel 01/08/2012 looks at the heavy corporate tilt in recent Supreme Court free speech rulings.

Brutal immigration policies that often sweep up American citizens in illegal deportations: Digby, State sanctioned kidnapping Hullabaloo 01/07/2012

Arrest and deterntion without due process: Daphne Eviatar provides and example of the problems those policies continue to cause in The Latest Skirmish in Afghanistan: Hate to Say We Told You So Huffington Post 01/08/2012.

Glenn Greenwald writes about the new law allowing the President to order indefinite detention of anyone including American citizens, a right both the Cheney-Bush and Obama Administration have claimed is within the President's authority even without Congressional authorization (The evil of indefinite detention and those wanting to de-prioritize it Salon 01/08/2012):

The Obama DOJ has repeatedly argued that the Boumediene ruling [requiring habeas corpus procedures for military detainees] should not apply to Bagram, where - the Obama administration insists - it has the power to imprison people with no due process, not even a habeas hearing; the Obama DOJ has succeeded in having that power enshrined. Obama has proposed a law to vest him with powers of "prolonged detention" to allow Terrorist suspects to be imprisoned with no trials. His plan for closing Guantanamo entailed the mere re-location of its indefinite detention system to U.S. soil, where dozens of detainees, at least, would continue to be imprisoned with no trial. And, of course, the President just signed into law the NDAA which contains - as the ACLU put it - "a sweeping worldwide indefinite detention provision," meaning - as Human Rights Watch put it - that "President Obama will go down in history as the president who enshrined indefinite detention without trial in US law." Those held at Guantanamo will continue to receive at least a habeas hearing, but those held in other American War on Terror prisons will not. [my emphasis]

Marcy Wheeler writes about the Guantánamo Gulag in Our New Teachers about Rule of Law 01/10/2012:

Gitmo has come to embody many things in this country over the last decade: Bush’s incompetence and criminality, our bigotry and inhumanity, and – as most would like to treat it now – a big political tussle between Obama and Republicans.

But at every turn – from the Bush Administration grasping claiming the piece of land existed outside the rule of law, to the corrupt legal process that created memos authorizing torture there, to Jim Haynes' insistence that "we can’t have acquittals," to the DC Circuit's continued efforts to make sure detainees get no meaningful review of their detention–Gitmo has been about shedding the rule of law. It has been about finding ways for America to defy the law even while maintaining the pretense we still uphold it. [my emphasis]

Torture: Digby has for years now been following the indiscriminate use of tasers by domestic police as torture weapons, which often has fatal results. As she points out in Dispatch from torture nation: execution by pepper spray Hullabaloo 01/07/2012, abuse of chemical weapons by police can also have the same consequences.

And we train them early to adapt to police-state conditions by putting cops in schools to rough up young evildoers: girls who won't pick up crumbs off the floor in the cafeteria, for instance, or spraying perfume on yourself at unapproved moments: Chris McGreal, The US schools with their own police Guardian 01/09/2012; Schul-Polizei.Wie US-Behörden Schüler kriminalisieren Frankfurter Rundschau 11.01.2012.

Tags: torture, guantánamo

EU finally notices Hungarian democracy issues

2012-01-12T10:17:00.000-08:00

Yesterday I was criticizing the EU for noticing Hungary's departures from austerity economics orthodoxy and getting all worked up about them, but neglecting their departures from democracy.

But on Wednesday, that did take some action, as Jack Ewing and James Kanter report in European Union Gives Hungary an Ultimatum New York Times 01/12/2012:

Faced with what critics say is an alarming drift away from democracy by one of its members, the European Union gave the Hungarian government a final warning Wednesday that it would face the start of formal legal action by next Tuesday unless it modified a series of measures that threaten the balance of power in the country.

The unprecedented warning by the European Commission, the European Union’s executive arm, came in response to the passage of a new Constitution and a number of laws at the end of last year that remove checks and balances on the government of Prime Minister Viktor Orban in areas like central banking, the judiciary and the media. ...

Thorbjoern Jagland, secretary general of the Council of Europe, said by telephone on Wednesday that “there’s a real danger of Hungary going off the rails.” The council, based in Strasbourg, France, is responsible for enforcing the European Convention on Human Rights.

The escalating political confrontation with Hungary comes at a decidedly inconvenient time for Europe as well as for the government of Mr. Orban. The euro zone is struggling to survive a debt crisis while its economy slows markedly. But Hungary can ill afford to alienate its European Union partners when it is also heading into recession and negotiating for financial aid from the International Monetary Fund and the European Union to avoid defaulting on its debt.

The wording in that first paragraph is classical faux objectivtiy, though: "what critics say is an alarming drift away from democracy." They do get into more of the specifics. But our political press is just so wedded to that "this side says, the other side says" formula that they can barely tear themselves away from it even in cases like this where it's painfully obvious that they need to. For instance, that lede paragraph could have read something like this:

Faced with actions by the Hungarian government to restrict freedom of the press and religion, severely compromise the independence of the judiciary and rig electoral districts to retain the current ruling party in power indefinitely, the European Union gave the Hungarian government a final warning Wednesday that it would face the start of formal legal action by next Tuesday unless it modified a series of measures that threaten the basic democratic institutions of the country.

Instead, they used as formula that reads more like this: Supporters of democracy say democracy is democracy; enemies of democracy say authoritarianism is democracy; opinions differ.

We'll see if the Angiefied EU will give their democratic priorities greater weight than Angie's austerity economics demands.

A key factor in the current situation is that Hungary is part of Angie's EU-26 (excluding Britain) that she expects to approve austerity treaties by March that, among other things, would give the "Merkel EU" ultimate authority over national budgets. If Hungary breaks ranks on that immediate demand, other countries would be more likely to bail, because then Hungary would be the bad guy of the situation. This surely gives Hungary some serious negotiating clout right now, e.g., lay off griping about our authoritarian new constitution, or we'll torpedo your austerity treaty.

Tags: angela merkel, eu, euro, european union, hungary

Corey Robin’s "The Reactionary Mind" (2011): (4 of 4): John C. Calhoun and his political heirs

2012-01-12T08:00:00.000-08:00

[Continues directly from Part 3] In discussing political trends like these, we're not talking about separate rivers, or about separate states whose physical boundary lines can be defined. All were part of the same political system and responded to each other. Jacksonians and conservatives interacted and influenced each other at the margins. Conservatives and reactionaries, even more so.

What a reactionary looks like: John C. Calhoun

But the distinctions are meaningful and necessary. The Calhounian/hardline proslavery/Fire Eater trend in American politics produced a very distinct and non-conservative outcome: the Confederate rebellion. The Democratic Party split in 1860 with John Breckinridge running as the splinter Southern Democratic nominee and Stephen Douglas for the official Democratic Party. John Bell ran as the nominee of the Constitutional Union Party, and of course Abraham Lincoln as the Republican nominee.

The fact that the Calhounites became secessionists and set out to destroy the US Constitution, certainly as it applied to the states of the Confederacy. The Confederate Constitution established slavery as a permanent institution, a radical rejection of classical liberal political concepts in both its liberal and conservative variations.

It obscures far more than it clarifies to put Calhoun and the Fire Eaters in the same category with conservative Democrats and with those Republicans who leaned more toward conservative policies than Lincoln did. Nor would it be particularly helpful to blur the distinction between radical democrats like John Brown and the Republican Party. The proslavery factions, including those in the Union states who became Southern-sympathizing Copperheads during the Civil War, represented a definite reactionary trend that was very meaningfully different from pro-Union conservatives.

Left/right ideological difference weren't always cleanly represented in the actual political parties. Both the Whig Party and the Democratic Party had both proslavery and antislavery wings. In the 1850s the Democratic Party became clearly more and more conservative and the Fire Eater faction strengthened their hand. But even then, there were Democratic free-soilers who were still loyal to the Jacksonian democratic-egalitarian outlook. That complicates efforts to distinguish ideological trends. But it doesn’t make it impossible. The fact that conservatives and Fire Eaters were both in the Democratic Party up until the split of 1860 doesn’t change the fact that there was a huge difference between those who were willing to support secession by armed violence and those who were American patriots and remained true to the country and the Constitution.

Calhoun's Political Descendants

Fortunately, we haven’t had any more civil wars. But there continued to be distinct reactionary positions and advocates that could be distinguished from conservatives. The anti-democracy, anti-Reconstruction "Redeemer" movement in the South continued the Calhounian reactionary tradition. We can trace that tradition further, through the Jim Crow segregationists, the Ku Klux Klan resurgence in the 1920s including significant influence in non-Southern states, the massive-resistance movement against integration after the Brown v. Board of Education Supreme Court decision.

There was another significant radical-reactionary trend that can be identified, embodied in the Liberty League in the 1930s, continuing in the Old Right isolationist movement from the late 30s through the John Birch Society (JBS) to Ron ("Papa Doc") and Rand ("Baby Doc") Paul. And in the 20th century, Protestant fundamentalism emerged as a politically reactionary movement.

These three trends – white supremacy, business democracy-haters and fundamentalist Christianism – were more distinct from one another than they are today, though there was definitely overlap. The affluent grumps and occasional oil millionaire who were attracted to the John Birch Society, "a coven of anti-Communists and intellectual louts" (Stanley Crouch, "Why the Koch brothers love Herman Cain: The right- wing billionaires care only about their bottom line" New York Daily News 10/30/2011), looked kindly on fundamentalist Christianity and not so fondly on black people, for instance. There were also partisan differences. In 1960, segregationist ideology and white supremacist organizations like the Citizens Council were more directly influential on the Southern Democrats than on Republicans; the Old Right isolationist/hyper-nationalist Birchers were popular among segregationists but their appeal was more familiar to the paranoid anti-Communism of Republican Sen. Joe McCarthy and his admirers within the Republican Party; white fundamentalist Christians were a group that overlapped heavily with Southern segregationists but politicized “Christian Right” type groups such as Billy James Hargis' Christian Crusade were marginalized.

Organizations like the Birchers, the White Citizens Council and the Christian Crusade were generally understood to be Radical Right groups in 1960. And neither of the two main national parties wanted to be too closely associated with them.

But what came to be known as "movement conservatism" that congealed in the 1964 Barry Goldwater campaign combined much of the style, uncompromising rancor, conspiratorial thinking and much of the substance of their positions. And that Movement Conservative trend is now dominant within the Republican Party.

It strikes me that this reality may be heavily coloring Robin’s treatment of the conservative tradition in American history and in 19th-century political theory more generally. It certainly is difficult to distinguish conservative from reactionary in today’s Republican Party. Especially since reactionaries often self-identify as conservatives and all but the most radical organizations embracing that ideology call themselves conservatives.

The three Radical Right organizations I've just named can serve to illustrate the point. The JBS is still around and largely churning out the same cranky, crackpot notions as in 1960. You can hear them, or something very similar to them, in Glenn Beck's rants or Ron Paul's speeches. Papa Doc Paul's goofy goldbug economic ideas are popular among today’s Birchers. Their isolationist foreign policy does distinguish them from Republican imperial notions. But the hardcore nationalism and contempt for international law that lies behind the JBS' famous hostility to the United Nations and to foreign aid are both found in the kind of Dick Cheney thinking that dominates today’s Republican foreign policy. So is the contempt for democracy common among Birchers and white supremacists. Papa Doc may occasionally sound like a hippie pacifist when he talks about some military intervention he opposes. But his outlook is far removed from either liberal internationalism or pragmatic realism, the foreign policy concepts common in the Democratic Party.

Much of the rhetoric and vote-suppression practices of today’s Republican Party are straight out of the segregationist playbook. The successor organization to the Citizen's Council is still around, the Council of Conservative Citizens (CCC). And the heritage shows. They are more blatantly racist than even Rush Limbaugh tends to be. But their bitter sleaze-slinging would not seem that unfamiliar to FOX News viewers. Their website used to run articles by Sen. Trent Lott, who served as the Senate Republican leader until he got in trouble himself by his praise for Sen. Strom Thurmond’s 1948 segregationist Presidential campaign got to be embarrassing (plus the Bush White House preferred a different Senate leader at the time). Mississippi Gov. Haley Barbour, a former chair of the Republican National Committee, in 2010 famously praised the Citizens Council of the 1960s as a moderating influencing during the massive resistance to integration in Mississippi, when in fact the Council spearheaded the effort. The Republican Party’s decades-long strategy to appeal to white prejudice against African-Americans and, increasingly against Latinos, has given the CCC and, more importantly, its way of thinking a role in the Republican Party not unlike the one its predecessor organization had with the Democrats.

The influence of the Christian Right on the Republican Party can only be a secret to respectable pundits for whom the strange conventions of their pundit tribe require them to pretend its not that important. (I’m tempted to add that they surely know better. But given the odd ways so many of our Beltway Village pundits process things, I’m really not sure that they know better.) But it’s certainly no secret to Republican candidates at all levels. The kind of politicized Christian fundamentalism that made Billy James Hargis a marginalized crank in 1960 is now the outlook of the most important element in the Republican voting base. The biggest difference would be the emphasis that today’s Christianists put on Christian Zionism while downplaying the anti-Semitic core of that viewpoint. Though the latter is there, more evident in some like John Hagee than others.

Ronald Brownstein looked at the divisions in the Republican Party during the race for the 2012 Presidential nomination in The Two Republican Races National Journal 10/27/2011. Reporting on the results CNN/ORC surveys, he is appropriately cautious in describing the division between the Tea Party/evangelical portion of the Party and those who don’t identify so closely with it:

The CNN/ORC surveys divide Republican voters into those who express support for the tea party and those who are neutral or opposed to the movement. In the most recent survey, 49 percent of Republican voters expressed sympathy for the movement, 45 percent said they were neutral and 5 percent said they opposed it.

That roughly 50-50 split is a reasonable proxy for the divide in the party between the most ardently ideological and populist elements (who express support for the tea party) and the somewhat more pragmatic (and to some extent moderate) voters who are more focused on reviving the economy than crusading against Washington. (Largely overlapping with that divide is a similar division between voters who identify as evangelical or born-again Christians and those who don't; most polls have found evangelicals disproportionately represented among the tea party supporters.) [my emphasis]

Later he makes a distinction between “the more pragmatic and secular wing of the party”, on the one hand, and the Tea Party/Christianist wing on the other.

Even people who should probably know still sometimes refer to a “moderate” wing of the Republican Party. But at best the Party has a conservative wing and a reactionary one, though distinguishing the two is particularly challenging. Which is why Corey Robin’s longer historical argument rings true if you’re projecting backward from today’s US Republican Party.

But it is nevertheless flawed and misleading. And flawed in a way that less likely to help liberals and progressives understand the real political currents in today’s conservative movement and the Republican Party which is its main vehicle than it is to serve hardline rightwingers in passing themselves off as harmless, stodgy let’s-make-haste-slowly conservatives. Or, to use Grover Norquist’s notorious metaphor, it doesn’t help to distinguish those who are mainly concerned with not throwing out the baby with the bathwater from those who want to drown the baby in the bathwater. The baby in this case being democracy.

Returning to Robin's eighth chapter in which he makes jarring juxtapositions among Burke and Reagan, Goldwater and Tocqueville and De Maistre: This chapter first appeared in a collection called Performances of Violence, ed. Austin Sarat, Carleen Basler, and Thomas L. Dumm (Amherst: University of Massachusetts Press, 2011). He uses the calls he finds from various conservatives for grand adventures and causes to argue that conservatives have a particular fondness for war. And that in turns feeds into his larger argument of an essential "unity on the right" of conservatives and reactionaries in which he seats "at the same table" his motley collection that includes "philosophers, statesmen, slaveholders, scribblers, Catholics, fascists, evangelicals, businessmen, racists, and hacks: Hobbes next to Hayek, Burke across from Palin, Nietzsche in between Ayn Rand and Antonin Scalia".

In that chapter, he calls to witness, along with Sorel and Churchill, Theodore Roosevelt. That would be the Theodore Roosevelt who established the national park system, the Republican President who made the hallmark of his Presidency his fight against the "trusts", the name used at the time for corporate monopolies. He doesn't make an argument as to why an icon of liberal Republicans – yes, such creatures once walked the earth! – should be considered a conservative. Much less why he should also be considered essentially the same as the most hidebound reactionary.

And when it comes to war, that is scarcely a specialty of conservatives and reactionaries, though both may tend to consider it especially praiseworthy. Teddy Roosevelt certainly delivered some blistering jingoistic rhetoric against Germany during the First World War. But was he really more inclined to war that the liberal Democratic icon Woodrow Wilson? Robin doesn't even try to make that case.

Robin's The Reactionary Mind includes many valuable observations, including his profiles of Ayn Rand and American neoconservatives. But his central argument, which he mostly presses in the Introduction, that conservatives and reactionaries are essentially the same, is not convincing.

"Radicalism is the raison d'être of conservatism; if it goes, conservatism goes too," he argues. But many conservatives are the stereotypically dull conservatives who are afraid of change, afraid of the disruption of hierarchies and who want to make haste slowly. Militant rightists are kindred spirits in many ways. And they draw heavily on conservative ideas, typically referring to themselves as conservatives. But the political tribe of John Calhoun is nevertheless a different crowd than that of Daniel Webster.

Tags: corey robin, reactionary mind

Angie-nomics in Greece and elsewhere (Updated)

2012-01-11T21:13:00.000-08:00

Anthony Faiola reports for the Washington Post In Greece, fears that austerity is killing the economy 01/10/2012. The austerity program that Greece adopted at the insistence of German Chancellor Angela Merkel and the EU is showing definite effects:

Does austerity really work?

Unemployment has surged to 18.8 percent from 13.3 percent only a year ago. Overburdened public hospitals are facing acute shortages of everything from syringes to bandages because of budget cuts, with hiring freezes forcing the mothballing of operating rooms even as more unemployed are relying on the public health system. Rates of homelessness, suicide, crime and HIV cases from intravenous drug use are jumping.

Greece has been forced to cut spending and raise taxes in the middle of a severe downturn, slashing pensions as well as state salaries, jobs and services. As public confidence has evaporated, consumer spending — the biggest driver of the economy — has plunged, generating cascading losses at private firms. The result is a dizzying economic plummet and social crisis that is bringing the cradle of Western civilization to its knees.

“Conditions have deteriorated so dramatically that doctors in this country now believe that the Greek crisis is no longer just a financial crisis but a humanitarian crisis,” said Dimitris Varnavas, the president of the Federation of Greek Hospital Doctors’ Unions. [my emphasis]

But of course Angie and Nick are sympathetic:

On Monday, German Chancellor Angela Merkel and French President Nicolas Sarkozy turned up the heat on Greece, suggesting that its bailout deal is in danger of unraveling if Athens does not press ahead quicker with pledged budget reforms and seal a deal with bondholders to voluntarily restructure its massive debt. But they also acknowledged that new steps are needed to combat slowing growth in the euro zone, where economists fear a looming regional recession as other indebted nations from Italy to Spain to Ireland also make deep spending cuts to reassure worried investors.

Or, not.

The EU is also taking action against Hungary, where the current authoritarian government has seriously restricted democratic institutions and rights. The Hungarian uprising of 1956 was one of the signature crises of the Cold War. Many people in Western democracies had a heartfelt sympathy for Hungarians striving for greater democracy and freedom. So it would be awful if the EU, whose purpose is to protect peace and democracy, were to ignore what's happening in Hungary.

And the EU is taking action ... because Hungary is violating Angie's insistence on austerity economics during the depression. Angie and the Angie-fied EU definitely have their priorities. (Staatsdefizit.EU will Ungarn bestrafen Frankfurter Rundschau 12.01.2012) (Update 01/12/2012: See my later post on the action taken mid-week by the EU that does address the democracy issues.)

Jawohl, Herr Monti, you vill do vhat you are told and you vill pretend to like it!

Angie summoned Italian Prime Minister Mario Monti to Berlin for a meeting on Wednesday to receive his latest instructions. Monti is the unelected head of the government installed in Rome at Angie's insistence to act as debt collectors on Italian sovereign debt obligation for the European banks. Robin Alexander writes in Mario Monti wehrt sich gegen Italien-Misstrauen Welt Online 11.01.2012 "Mario Monti ist ein Geschöpf des neuen Merkel-Europas. Ein Politiker, der nie eine Wahl gewann, aber sich ganz der Steigerung der Wettbewerbsfähigkeit seines Landes verschrieben hat." ("Mario Monti is a creation of the new Merkel Europe. A politician who never won an election, but one who is completely committed to the increase of the competitiveness of his country.") Increasing competitiveness is standard neoliberal/Herbert Hooverish talk for cutting back pensions, health care, jobs, unemployment insurance and government services.

But even "a creation of the new Merkel Europe" was publicly grumbling about the need for some kind of economic stimulus in this depression, if only for consumption by his constituency that never elected him back home. (Thomas Schmid, Warum Italien mehr wie Deutschland sein sollte Welt Online 11.01.2012) Angie claimed after their meeting Wednesday that they hadn't argued.

Monti had warned publicly Angie about the problem of austerity measures provoking anti-EU and specifically anti-German sentiments among Italians. Alexander reports that Princess Angie was not pleased. "Diese Drohung hat Merkel nicht gefallen." ("Merkel did not like this pressure.")

Angie hopes to get agreement at the EU summit on January 30 of the EU-minus-Britain group on the treaty language instituting permanent austerity economics she demands that they all pass by the end of March.

Angie is driving the EU toward the cliff with the pedal to the metal.

Tags: angela merkel, eu, euro, european union, greece, italy, mario monti

Perils of Papa Doc Paul

2012-01-11T14:54:00.000-08:00

There's no way Ron "Papa Doc" Paul and his base constituency are going to be part of a political coalition that could be called liberal or progressive. At the same time, thanks to the nature of our media culture right now, the only kind of broad criticisms of US global military strategy and interventions that most people have heard on TV recently are those coming from Papa Doc. For liberal critics of those policies, Papa Doc's framing is a real problem, not only because of his kooky conspiracy theories but because he often couches them in the false-but-mainstream austerity-economics argument that the US is going broke and can't afford more borrowing or deficits.

Gene Lyons takes on Papa Doc and his movement for the second time in two weeks, Digging in Ron Paul's Survival Kit Arkansas Times 01/11/2012:

While he's often cagey about how he expresses it, Ron Paul's whole history as a conspiracy theorist is right out of the "Protocols of the Elders of Zion" — the 19th century forgery that's kept anti-Semites buzzing for generations. ...

Reader Mel Birge of Portland, Oregon argues that's precisely why Paul makes such a terrible spokesman. Complaining of "sitting in synagogue for the last dozen years listening to pseudo Middle-East experts give the same frantic talk about the danger of Iran nukes and how the US must stop it," he believes such a war "is no way in the United States' interest."

But he also thinks Paul's "anti-semitic paranoia allows AIPAC, the Neocons and their fellow travelers to paint the entire Iran war opposition with the Ron Paul brush. That's the danger of Ron Paul that you should speak of: He snuffs out substantive discussions on Iran. The media feasts on him and the Neocons love it because he's his own straw man."

Charlie Pierce in his look at the state of the Republican Presidential race, We're All in Romney's Great Adventure Together Now Esquire Politics Blog 01/11/2012, writes that we could have Papa Doc as a visible factor in the Presidential election for months to come:

Which leaves us with the fascinating question of Dr. Ron Paul. He finished a decent second last night, crushing the campaign of Jon Huntsman. He is in an odd place. He is not a contender for the nomination in any real sense. However, he can continue to move through the cycle, not seeking conventional success, but piling up delegates pledged only to him. (If the rumors around Manchester on Tuesday night are true, and Paul's campaign has managed to raise $10 million over the past few days, then he can go on forever. That amount of money to his campaign is $100 million to a more conventional one.) This will give him a center of personal power with which Willard, and the rest of the party, will have to find some way to cope. Paul has stubbornly - and shrewdly - refused to state categorically that he will not bolt the party in the general election. He can string the whole business along, talking in his giddy survivalist code about "fiat money," and nobody will be in any position to take him on. He is going to stay on his own hook; in 2008, across the river in Minneapolis, Paul set up his own convention in opposition to the Republican National Convention. He can do whatever mischief he wants from now until the end of the summer, and nobody's in any position to make him stop. That is the only story left, save for the epic Horatio Alger saga of Willard Romney, Boy of the Streets, proud American, and proof positive that, in this great country, any son of an auto millionnaire and former governor of Michigan can grow up almost to be president. [my emphasis]

Papa Doc is a destructive, retrograde influence in American politics, and not solely inside the Republican Party. But progressive critics of the militarism and interventionism of our current foreign policy also have to deal with the reality that, in the 2012 election cycle, the main general criticism of the current approach to foreign policy that many voters will hear - the only one many voters are likely to register - is that coming from Papa Doc.

That doesn't mean we have to pretend that Papa Doc's general perspective is anything other than the Old Right isolationism and Bircher conspiracy-mongering that it is. The core concept of Papa Doc's foreign policy is hyper-nationalism and xenophobia, which is how it fits in with anti-immigrant and pro-segregation parts of Papa Doc's toxic ideology. And it certainly doesn't mean that the motley crew of segregationists, militia types and assorted cranks who make up Papa Doc's core constituency are even potential allies in any meaningful sense of the word for a progressive movement.

But it does mean that we need to pay attention to which parts of Papa Doc's criticisms of foreign policy are resonating with the public, or have the potential to resonate with a larger audience.

Stephen Walt takes a careful look at Papa Doc's effect on the larger national security debate in Why Ron Paul may actually have something right Foreign Policy 01/06/2012:

... [D]espite his bizarre views on the gold standard, climate change, social security, and the like, Paul has put his finger on a number of issues that could resonate broadly with the American people, especially if discussion were not monopolized by think tanks and insiders who are strongly committed to the status quo. Unlike most foreign policy "experts" in both parties, Paul believes the United States is an extraordinarily secure country, with a robust nuclear deterrent, no powerful enemies nearby, and at present no major power rivals of much significance. He instinctively rejects the paranoia and worst-casing that has convinced Americans that we need to roam around the world trying to remake it in our image (a task, by the way, that we're not very good at). He believes that excessive interventionism and other failed policies are a primary cause of anti-Americanism around the world, and that the United States would be more popular and safer if we focused more attention on trade and diplomacy and domestic issues instead of emphasizing military dominance and overseas meddling. He believes that a bloated national security state and a quasi-imperial foreign policy inevitably fosters greater government secrecy and erodes traditional restraints on executive power. And like former president (and five-star general) Dwight D. Eisenhower, he thinks the current military-industrial complex wields excessive influence on our politics and has become a self-perpetuating engine for counter-productive meddling abroad.

These points are all debatable, of course, but Paul is the only person in the race who even wants to discuss them. The rest of the GOP candidates are mostly competing to see who can sound the most eager for war (usually with Iran) or most willing to toss more money at the Pentagon. Barack Obama is a lot more sensible than they are, but as we've learned over the past three-plus years, neither he nor his national security team are interested in making dramatic changes in America's overall grand strategy. Instead, Obama has emerged as a strong proponent of government secrecy, a staunch defender of maintaining U.S. primacy around the world, and as an enthusiastic user of drones, special forces, and other tools of U.S. power. He did eventually wind down the war in Iraq, of course, but it hardly took a strategic genius to figure out that this was the right course.

Tags: gene lyons, radical right, ron paul, stephen walt

The revolving door, Mississippi version

2012-01-11T08:55:00.000-08:00

Good ole Haley Barbour has finished up his second and final term as Governor of Mississippi. He gained some national attention with his defenses of the Confederate flag and the White Citizens Council. Now, the present-day Cincinnatus is going back to his plow. In ole Haley's case, his farm is the field of influence-peddling politely know as lobbying. Kate Ackley reports for Roll Call, Haley Barbour’s Back at His Old Firm 01/10/2012:

Mississippi Gov. Haley Barbour (R), who left office today, wasted no time in lining up his next career move. As expected, the former uber-lobbyist and founder of BGR Group will return to his old firm, the lobby shop announced today.

In a short statement, the firm said it "is pleased to announce Governor Haley Barbour will return to the firm as Founding Partner." Haley did a stint prior to his governorship as chairman of the Republican National Committee.

Barbour, a longtime Washington insider known for his Mississippi drawl, remained a presence inside the Beltway even while serving as governor. In 2009, he was elected chairman of the Republican Governors Association, a position that regularly brought him to D.C. And when he considered a presidential run, he had a long list of former colleagues and clients who were ready to line up in support. [my emphasis]

But Ole Haley left something for his former Mississippi constituents to remember him by. He pardoned four murders on his way out the door of the Governor's office, two of them who had murdered their wives. (Ronni Mott, Barbour to DV Victims: ‘You Can’t Trust Us’ Jackson Free Press 01/10/2012)

Jessica Bateman reports in Karen Irby, 207 others granted reprieves by Haley Barbour Jackson Clarion-Ledger 01/10/2012:

In total, Barbour has granted clemency to 41 offenders in prison for killing and many others who committed violent or sex-related crimes.

... 39 prisoners who were granted clemency committed a slew of other violent crimes, including rape, aggravated assault, assault to a law enforcement officer and armed robbery. Thirty-two of those people received full, complete and unconditional pardons from the governor.

At least seven of the convicts who were pardoned committed sex-related crimes, including rape, forcible sexual battery, gratification of lust and attempted enticement of a child for sexual purposes or prostitution. After receiving pardons, they are no longer required to register as sex offenders.

Bateman provides a comparison with the three previous Governors' pardons:

Compared to past Mississippi governors, former Gov. Ronnie Musgrove granted an unconditional pardon to only one person. He granted 25 suspended sentences or restorations of civil rights, which reinstates the right to vote to felony offenders.

Former Gov. Kirk Fordice pardoned 13, and granted suspended sentences or restorations of civil rights to 26 more. Former Gov. Ray Mabus pardoned five, and granted 68 suspended sentences or restorations of civil rights, although he later revoked those rights from 11.

And former Gov. Bill Allain granted no pardons at all, but granted restorations of civil rights to 28.

Ackley' report quotes Sandy Middleton, executive director of the Center for Violence Prevention, on the message Barbour's pardons of the wife-murderers sends:

"The criminal-justice system works here," Middleton said. "Law enforcement did their jobs."

But Barbour's pardons "flies in the face" of the people who work hard to get these offenders away from their victims, she added, in addition to the victims themselves.

"It just puts us back to square one," when it comes to the people at the receiving end of the violence, Middleton said. The message Barbour sends to them is that "You can't trust us, because we're really not going to protect you."

But Republicans are the Family Values party, remember that.

Tags: haley barbour, mississippi, mississippi politics

Corey Robin’s "The Reactionary Mind" (2011): (3 of 4): Log Cabin conservatives

2012-01-11T08:00:00.000-08:00

[Continues directly from Part 2] The 1940 campaign brought a notable adjustment in campaign style for the more conservative party vs. the Jacksonian Democrats. Incumbent President Martin Van Buren was the Democratic candidate. The Whig Party ran war hero William Henry Harrison, whose campaign devised one of the most famous campaign slogans in American history, "Tippecanoe and Tyler Too". Tippecanoe was Harrison's nickname; John Tyler was his Vice Presidential candidate.

William Henry Harrison

The Whig Party realized that to get a President elected dedicated to protect the power and privilege of businessmen and bankers, they needed to find someway to sell that program to an expanding electorate; extending the franchise by such methods as eliminating property ownership requirements had been a key achievement of the Jacksonian movement which heavily influenced Van Buren and his Administration, as well.

To do so, they adopted a less overtly elitist pose than the Federalists had. The classic A Concise History of the American People (1977 edition) by Samuel Eliot Morison, Henry Steele Commager and William Leuchtenburg describes the campaign this way:

'Tippecanoe and Tyler too' was the slogan. The Whigs had so far abandoned patrician values that Van Buren was pictured with cologne-scented whiskers, drinking champagne out of a crystal goblet at a table loaded with costly viands and massive plate. An unlucky sneer in a Democratic newspaper, to the effect that Harrison would be content with a $2000 pension, a log cabin, and plenty of hard cider, gave opportunity for effective contrast. It became the log-cabin, hard-cider campaign.

Morison in The Oxford History of the American People (1965) adds:

The reason why the 1840 campaign became the jolliest and most idiotic presidential contest in our history is that the Whigs beat the Democrats by their own methods. They adopted no platform, nominated a military hero, ignored real issues, and appealed to the emotions rather than the brains of voters. Expectations of profit and patronage were employed to "get out the vote," and the people were given a big show. Democratic politicians, even Jackson himself, now complained of Whig demagoguery. ...

There were log-cabin badges and log-cabin songs, a Log Cabin newspaper and log-cabin clubs, big log cabins where the thirsty were regaled with hard cider that jealous Democrats alleged to be stiffened with whiskey; little log cabins borne on floats in procession, with latchstring out, cider barrel by the door, coonskin nailed up beside, and real smoke coming out of the chimney ...

Arthur Schlesinger, Jr. adds more details in The Age of Jackson (1945):

With tireless industry and bewildering resources Whigs everywhere rushed to doff their broadcloth and flaunt their homespun. Every speech, song and slogan held up the rustic and plebeian as closest to the Whig soul. The staid meetings of their past gave way to barbecues, clambakes, excursions and noisy processions. Raucous campaign songs echoed in the streets ...

Wood engravers and lithographers were kept perpetually busy turning out pictures: Harrison the Hero of Tippecanoe, astride a monumental horse; Harrison as Cincinnatus at the plow; Harrison greeting his comrades at arms at the door of his log cabin, with a long latchstring hanging down; Harrison as an Indian chief, paddling furiously toward the White House from which Van Buren ("the Flying Dutchman") was fleeing; Harrison as a boxer administering a thrashing to Van Buren, with Old Hickory, as Van Buren’s trainer, looking on in gloom. Brass and copper medals were struck off, with a log cabin, a flag, a barrel and a cup on one side, Harrison on the other: "He leaves the plough to save his country."

Winning the masses for causes hostile to their interests

The period 1815-1848 in continental Europe was the era of the post-Napoleon Restoration. The various kings and principalities there did not feel a great need at that time to build a base of mass support for conservative policies. Mass acquiescence was sufficient. Otto von Bismarck’s later devices for building mass support for his military and monarchist politics in Germany may not have been quite so cornpone as the Tippecanoe and Tyler Too approach. The same was true of Napoleon III's regime in France. But they knew they had to build some basis of public support for there regimes among the general public, which expected to play a more active role in governance than the people of the 17th and 18th centuries had played up until the French Revolution.

Corey’s The Reactionary Mind is a history of ideas and thinkers which requires him to deal with their stated ideals. But throughout the book he tends to treat the seeming disconnect between conservative ideals of stability, hierarchy and tradition and the often militant, public-spirited tone of their writing as a psychological phenomenon disconnected to their historical context.

Corey's eighth chapter, "Easy to Be Hard", provides an example of the disjointed argumentation that recurs throughout the book. Quoting from Edmund Burke's A Philosophical Enquiry into the Origin of Our Ideas of the Sublime and Beautiful (1757), Corey shows Burke lamenting the effects of peace and prosperity:

'When it has run its career, Burke says, pleasure "sets us down very nearly where it found us." Any kind of pleasure "quickly satisfies; and when it is over, we relapse into indifference." Quieter enjoyments, less intense than pleasure, are equally soporific. They generate complacency; we "give ourselves over to indolence and inaction." Burke turns to imitation as another potential force of outward propulsion. Through imitation, we learn manners and mores, develop opinions, and are civilized. We bring ourselves to the world, and the world is brought to us. But imitation contains its own narcotic. Imitate others too much and we cease to better ourselves. We follow the person in front of us "and so on in an eternal circle." In a world of imitators, "there never could be any improvement." Such "men must remain as brutes do, the same at the end that they are at this day, and that they were in the beginning of the world."

Burke's Sublime and the Beautiful was a work of aesthetic theory, scarcely as influential on conservative and reactionary thinkers as his Reflections on the Revolution in France (1790), and not remotely as well known. But Robin treats it as a classic of the conservative canon as he writes:

For a certain type of conservative theorist, passages like these pose something of a challenge. Here is the inventor of the conservative tradition articulating a vision of the self dramatically at odds with the imagined self of conservative thought. The self, as we have repeatedly seen, claims to prefer "the familiar to the unknown ... the tried to the untried, fact to mystery, the actual to the possible, the limited to the unbounded, the near to the distant, the sufficient to the superabundant, the convenient to the perfect, present laughter to utopian bliss." [Michael Oakeshott] He is partial to things as they are not because he finds things just or good, but because he finds them familiar. He knows them and is attached to them. He wishes neither to lose them nor to have them taken away. Enjoying what he has, rather than acquiring something better, is his highest good.

In the next paragraph, Corey jumps two centuries-plus into the future from The Sublime and the Beautiful to describe this as a fundamental oddity in conservative/reactionary thought:

Perhaps it is this lethal ennui, lurking just beneath the surface of conservative discourse, that explains the failure of the conservative politician to follow the lead of the conservative theorist. Far from embracing the cause of quiet enjoyments and secure attachments, the conservative politician has consistently opted for an activism of the not-yet and the will-be. Ronald Reagan's first inaugural address was a paean to the power of dreams: not small dreams but big, heroic dreams, of progress and betterment, and not dreams for their own sake, but dreams as a necessary and vital prod to action. Three months later, in an address before Congress, Reagan drove the point home with a quote from Carl Sandburg: "Nothing happens unless first a dream." And nothing happening, or too few things happening, or things not happening quickly enough, is what the conservative in politics dislikes. Reagan could scarcely contain his impatience with the dithering of politicians: "The old and comfortable way is to shave a little here and add a little there. Well, that's not acceptable anymore." Old and comfortable was the indictment, no "half-measures" the verdict. [my emphasis]

Ockham's razor suggests that Reagan’s rhetoric quoted there was an updated version of Tippecanoe’s log cabin and cider barrel. Reagan's supply-side economics, his determination to have a major military buildup and a stepped-up nuclear arms race and his hostility to social services were all about comforting the comfortable in the United States. Reagan's true political base was what George W. Bush would later characterize as his own base, too: "the haves and the have-mores". Reagan was calling on the Captains of Industry and the Lords of Finance to enjoy lower taxes and fewer pesky regulations on their quest for higher profits. The stirring appeals to great tasks and urgent problems was about rallying political support among the people who were far more likely to be hurt than helped by his policies.

The American Whigs didn’t invent this political concept in 1840, though they gave it their own modern form and started a tradition of down-home, we’re-folks-just-like-you conservative appeals that arguably continues today. The taunts of elitism the Whigs hurled at Martin Van Buren would surely sound familiar to John Kerry after his unsuccessful 2004 run for the Presidency as the Democratic candidate.

But the larger phenomenon has a longer history.

Die narzißtische Befriedigung aud dem Kulturideal gehört auch zu jenen Mächten, die der Kulturfeindschaft innerhalb des Kulturkreises erfolgreich entgegenwirken. Nicht nur die bevorzugten Klassen, welche die Wohltaten dieser Kultur genießen, sondern auch die Unterdrückten können an ihr Anteil haben, indem die Berechtigung, die Außenstehenden zu verachten, sie für die Beeinträchtung in ihrem eigenen Kreis entschädigt. Man ist zwar ein elender, von Schulden und Kriegsdeinsten geplagter Plebejer, aber dafür ist man Römer, hat seinen Anteil an der Aufgabe, andere Nationen zu beherrschen und ihnen Gesetze vorzuschreiben. Diese Identifzierung der Unterdrückten mit der sie beherrschenden und ausbeutenden Klasse ist aber nur ein Stück eines größeren Zusammenhanges. Anderseits können affektiv an diese gebunden sein, trotz der Feindseligkeit ihre Ideale in ihren Herren erblicken. Wenn nicht solche im Grunde befriedigende Beziehungen bestünden, bliebe es unverständlich, daß so manche Kulturen sich trotz berechtigter Feindseligkeit großer Menschenmassen so lange Zeit erhalten haben. (Sigmund Freud, Die Zufunft einer Illusion; 1928; S. 18-19)

The narcissistic satisfaction provided by the cultural ideal is also among the forces which are successful in combating the hostility to culture within the cultural unit. This satisfaction can be shared in not only by the favoured classes, which enjoy the benefits of the culture, but also by the suppressed ones, since the right to despise the people outside it compensates them for the wrongs they suffer within their own unit. No doubt one is a wretched plebeian, harassed by debts and military service; but, to make up for it, one is a Roman citizen, one has one's share in the task of ruling other nations and dictating their laws. This identification of the suppressed classes with the class who rules and exploits them is, however, only part of a larger whole. For, on the other hand, the suppressed classes can be emotionally attached to their masters; in spite of their hostility to them they may see in them their ideals; unless such relations of a fundamentally satisfying kind subsisted, it would be impossible to understand how a number of civilizations have survived so long in spite of the justifiable hostility of large human masses. (Sigmund Freud, The Future of an Illusion; James Strachey translation; p. 13)

Efforts to frame one’s policies or political philosophy in a way that appeals to people who may receive only limited benefits, or even be harmed, by its results is not some secret twist of the conservative mind that shows an essential hidden identity between conservatives and reactionaries. It's an ancient piece of politics and statecraft.

Continued in Part 4

Tags: corey robin, reactionary mind

Corey Robin vs. the Occupy movement

2012-01-10T11:39:00.000-08:00

Now I'm more concerned than ever about the implications of Corey Robin's ahistorical argument that there is no meaningful distinction between conservative and Radical Right. He's attracted quite a bit of sympathetic attention among progressives for this argument, which puts the stodgy go-slow-or-even-do-nothing conservative in the same boat with the howling reactionary who wants to create a dystopia based on some imagined version of an ideal 19th century.

He makes his case at some length in his book The Reactionary Mind: Conservatism from Edmund Burke to Sarah Palin (2011) . As a matter of history, I think he's seriously overreaching. I can understand the argument's contemporary resonance, though, given the current state of the Republican Party in which segregationist and McCarthyist talk that would not so long ago have been publicly disowned by respectable business conservatives is now considered normal, mainstream Republican practice.

Now Robin's addressing the Occupy movement in The Conservative Reaction Chronicle of Higher Education 01/08/2012. And this piece presents an uncomfortable reminder that if a stodgy conservative who mainly wants to not rock the boat for the 1% too much is the same as a blithering Bircher or a cornpone brownshirt, then the Birchers and the brownshirts are also no more threatening or obnoxious than your standard Chamber of Commerce or Rotary Club member.

Not that Robin is endorsing the Patriot Militias in his Chronicle piece. But he certainly does seem to be advising Republicans, hey, this is the kind of hippie agitation that you need to oppose the way you do it best:

After decades of "compassionate conservatism," "a thousand points of light," and "Morning in America," dark talk of class warfare on the right can seem like a strange throwback. So accustomed are we to the sunny Reagan and the populist Tea Party that we've forgotten a basic truth about conservatism: It is a reaction to democratic movements from below, movements like Occupy Wall Street that threaten to reorder society from the bottom up, redistributing power and resources from those who have much to those who have not so much. With the roar against the ruling classes growing ever louder, the right seems to be reverting to type. It thus behooves us to take a second look at the conservative tradition, not just its current incarnation but also across time, for that tradition provides us with an understanding of why the conservative responds to Occupy Wall Street as he does. ...

Given the reactionary thruST [sic] of conservatism, Occupy Wall Street may turn out to be the best thing that ever happened to the right. Thoughtful conservatives have long understood the symbiotic relationship between the right's intellectual - and ultimately political - vitality and insurgencies from the left. Friedrich Hayek accurately observed that the political theory of capitalism "became stationary when it was most influential" and "progressed" only when it was "on the defensive." Frank Meyer, intellectual architect of the fusion strategy that brought together the libertarian and traditionalist wings of the Republican Party, noted that it was "ironic, though not historically unprecedented," that bursts "of creative energy" on the right "should occur simultaneously with a continuing spread of the influence of liberalism in the practical political sphere."

Conversely, conservative writers like David Frum and Andrew Sullivan have worried of late about the intellectual flabbiness of the contemporary right: A movement that once seemed the emblem of heterodoxy has succumbed to stale thinking and rote incantations. But if Occupy Wall Street turns out to be a movement rather than a moment — if it has real staying power; if it moves from public squares to private institutions; if it starts to divest the elite of their privileges and powers, not just in their offshore accounts but in their backyards and board rooms — it could provide the kind of creative provocation that once produced a Burke or a Hayek. The metaphor of occupation is threatening enough; one can only imagine what might happen were it made real. And while the mavens of the right would probably prefer four more years to four good books, they might want to rethink that. They wouldn't be in the position they're in - when, even out of power, they still govern the country - had their predecessors made the same choice. [my emphasis]

That last part is a bit unclear, though he must mean "four more years" of Obama, though it's not at all obvious which "mavens of the right would probably prefer four more years" of the Marxist-Kenyan-socialist-European-Islamunist-atheist Obama to having a Republican in the White House.

In the real world, of course we're seeing pushback from the right over the Occupy movement. And what are we supposed to make of this statement, "A movement that once seemed the emblem of heterodoxy has succumbed to stale thinking and rote incantations"? When the Republicans were prominently congratulating themselves for being the "party of ideas", those great ideas were crackpot things like supply side economics, union-busting, boosting military spending and freeing the wealthiest Americans from the oppressive burden of having to pay taxes to support their country. Pretty much the same "stale thinking and rote incantations" of these days, only marketed a bit more cleverly. Stuff like that may have made Young Republicans think of themselves as "the emblem of heterodoxy" though it more closely resembled what was once called "hardening of the arteries", i.e., old-age dementia.

But the relative lack of mildly disruptive activism like that of the Occupy movement certainly hasn't slowed the radicalization of the Christian Republican White People's Party. On the contrary, Occupy is forcing even the Republicans to give some lip service to helping working families. Even though much of it looks more like dementia than either "the emblem of heterodoxy" or "stale thinking and rote incantations". Will Bunch reports on Rick Santorum campaigning in New Hampshire (The Santorum surge isn't working Attytood 01/09/2012):

He chose to devote his entire speech to his tax and pro-manufacturing policies – completely avoiding any mention of his signature issues like abortion and family values. Instead, he made a blatant pitch for working class votes.

"Imagine, the president of the United States standing up and saying everybody should go to college in America," Santorum said of President Obama at one point "What intellectual snobbery is that?! Not every person wants or needs to go to college or should have to go to college. Hard work, getting skills, getting training, whether it’s at a trade school or whatever, is good work and important work." He then claimed that Obama instead wants to "redistribute wealth" to those who don’t get into college.

The fact that someone considered a credible if faltering Republican Presidential candidate within their Party is holding up college attendance as a sign of "intellectual snobbery" is a good example of how in the real existing Republican Party of 2012, it's hard to make a meaningful distinction between stodgy conservative and drooling reactionary.

But that's not what Robin is doing in the Chronicle article. It reads more like he's pointing to the Occupy movement and telling Republicans, you need to go after these people!

I also notice that, in the paragraphs at the end of the article, he talks about if the Occupy movement achieves such-and-so and if they achieve this other thing. But in the first paragraph quoted above, which is the second paragraph in the article, he talks about "movements like Occupy Wall Street that threaten to reorder society from the bottom up." I know that some of the activists see that as an ultimate goal. But in real time, there is no way that the Occupy movement is about to stage some massive general strike and bring on an apocalyptic change that would "reorder society from the bottom up". Any politician or police chief - or anti-terrorism official - who sees the Occupy movement that way at this moment is likely smoking some of that Ron Paul Bircher weed.

Tags: corey robin, occupy movement, reactionary mind

Angie, the German President, the FDP and saving the EU

2012-01-10T10:20:00.000-08:00

Günter Bannas argues that the current assumption that German President Christian Wulff can serve out his term in office only if Chancellor Angela Merkel continues to back him actually reverses the power dynamics at work here. He argues that whether Princess Angie von Merkel can continue her Chancellorship hangs on whether Wulff stays in office rather than resigning in the face of the current scandal. (Regierungskoalition. Geschwächt wie nie Frankfurter Allgemeine Zeitung 09.01.2012)

His thinking is this. The German President is not chosen by Parliament as such or by popular vote. He's chosen by a body called the Bundesversammlung (Federal Convention) that is similar in concept to the American Electoral College. Not that the comparison clarifies much!

The Bundesversammlung includes all Members of the Bundestag (the lower House of Parliament) and an equal number of representatives chosen by the German states (Länder), as this article from the 2010 Presidential election time explains: How Germany's president is elected Deutsche Welle 29.06.2010

In partisan terms, this means that the composition of the Bundesversammlung is affected not only by the proportions in the national Parliament but also by the strength of the parties in the state parliaments (Landtags). Bannas writes that Angie's national coalition of her own CDU/CSU and the FDP would together have a bare majority in a new Bundesversammlung. But in 2010, with a bigger margin, it still took three votes in the Bundesversammlung to elect the current scandal-plagued President.

In German political dynamics, this would mean that Angie would likely have to agree on a Presidential candidate with the opposition Social Democrats (SPD), which would further increase the tensions in her governing coalition with the FDP. The FDP is having an existential crisis now, not as in anguished hand-wringing, but as in they are worried about their continued existence as a party. It's generally assumed that being in Angie's coalition has made it difficult for them to establish a clear profile among the public. If Angie's flips them off and makes a deal with the SPD on a joint Presidential candidate in the near future, that could be enough to persuade the FDP to bolt the coalition and bring down her government.

Or, as Bannas puts it, "Rasch könnte der Ausgang einer neuen Bundesversammlung die gedemütigte FDP zu einem letzten Rettungsanker greifen lassen, dem Bruch der Koalition mit der Union. Das Ende des zweiten Kabinetts Merkel wäre gekommen." (The outcome could quickly be that the humiliated FDP would grasp at its last saving anker, breaking the coalition with the Union [CDU]. The end of Merkel's second Cabinent would have arrived.)

Now, Angie likes power, in itself a good thing in a national leader. But Angie also has a mission, to impose austerity economics on all of Europe during this depression and roll back as much of the social state in Europe as she can get away with. She can also be bull-headed, as in lower head, aim horns, charge. We see her taking that approach with the euro crisis right now.

So if she thinks she can rope the SPD into another coalition in which the SPD agrees to support her Herbert Hoover austerity economics, she may go for it. She may be thinking that she's gotten this far out on a limb with her EU policies and it hasn't broken off and fallen into the abyss yet. She may figure, why not take another step or two and make the SPD my junior partner in bringing Europe to heel and lowering the living standards of ordinary Germans, too? She has a bit of Dick Cheney in her.

Bannas himself gives an interesting hint that Angie may be thinking along those lines, even though he's arguing it would be politically suicidal for her and the CDU. In the state of the Saarland for the last two years, the CDU has been heading the first "Jamaica coalition" at the state level, the name coming from the colors of the Jamaican flag and referring to a coalition of the CDU (black in the German partisan color scheme), the FDP (yellow) and the Greens (green, duh!). The FDP was having a national convention last week they hoped to use as a springboard to improving their electoral profile. But the CDU head of the Saarland Jamaica Coalition announced that she was dissolving the coalition and timed the announcement to coincide with the FDP convention, a real slap in the face the FDP. Bannas notes that Angie gave her blessing to the announcement, which one would assume in any case.

This is another sign that Angie is seriously considering the possibility and/or necessity of dumping the FDP as a national coalition partner sooner rather than later. In addition, Bannas quotes one of Angie's longtime cronies, Bundestag CDU/CSU caucus leader Volker Kauder, dissing the FDP and at least implying that Angie agrees with him.

Angie has a plan, and least to bring the eurozone under her idea of the Proper Order. But she's also lurching from crisis to crisis. The best chance for the survival of the euro and the EU may turn out to be the fall of Angie's government and its replacement by one not willing to insist on Herbert Hoover austerity in the middle of a depression.

That is, if Angie and Nicolas Sarkozy and David Cameron and the European financial lobby haven't done irreparable damage to the European project already.

Tags: angela merkel, eu, euro, european union

Corey Robin’s "The Reactionary Mind" (2011): (2 of 4): Jefferson, Jackson and the two Adamses

2012-01-10T08:00:00.000-08:00

[Continuing directly from Part 1] Later conflicts are usefully understood by distinguishing actual reactionaries from conservatives. Federalist Aaron Burr wound up being a pro-British reactionary and probably an actual traitor. When the arch-conservative Hamilton died in a duel with Burr, it was by far the better man who lost.

Jefferson's conflicts with Supreme Court Chief Justice John Marshall are also better understood as a conflict between left-liberal and conservative-liberal supporters of the Constitution and of the liberal American form of government (speaking again of classical liberalims). No less a left icon than I.F. Stone described one conflict between Jefferson and Marshall (over Burr's treason trial) as a conflict "between Jefferson and Marshall, the radical Democrat and the conservative Federalist." ("A Special Supplement: Impeachment" New York Review of Books 06/28/1973 issue)

Andrew Jackson

Looking at some of the details of that particular conflict, Stone memorably described it this way: "But the battle between Jefferson and Marshall was like one of those bouts in which the antagonists make the most devastating faces at each other, emitting blood-curdling screams, yet somehow never come to blows."

The Federalist Party largely destroyed itself, helped along by the political strategies of Republican Presidents Jefferson and Madison, when New England Federalists convened the secessionist, pro-British Hartford Convention during the War of 1812 in which Britain was making war against the United States. That led even a leading Federalist conservative like John Quincy Adams to switch to the party of Jefferson.

The Presidency from 1801 to 1841 was a one-party affair, though Jefferson's Democratic-Republican Party was severely divided by the 1920s. When Adams won the Presidency in 1924 in what his chief opponent Andrew Jackson called the Corrupt Bargain, the Jacksonians painted Adams as the defender of illegitimate elite privilege and power with Old Hickory as the defender of the common man. This was a classic left-right contest within the Constitutional system with two leading protagonists who both accepted the classical liberal concept of government and supported the existing Constitutional government. It was during Jackson's leadership that the Democratic-Republican Party of Thomas Jefferson, of which both Adams and Jackson were a part, became known as the Democratic Party.

Daniel Webster

When Jackson went to war against the Second Bank of the United States, one of its chief supports was the still-Federalist Senator from Massachusetts, Daniel Webster. Webster was also a conservative, not a reactionary, not someone who wanted to fundamentally change the Constitutional form of government or opposed the basic principles of classical political liberalism. He was a conservative. And as a conservative, he defended the power and privilege of the wealthy. In his speech to the Senate of 07/08/1832 criticizing Jackson for having vetoed the renewal of the charter of the Bank of the United States, he declared, identifying the pecuniary interests of the Money Power directly with the public good:

Congress passed the bill, not as a bounty or a favor to the present stockholders, nor to comply with any demand of right on their part, but to promote great public interests, for great public objects. Every bank must have some stockholders, unless it be such a bank as the president has recommended, and in regard to which he seems not likely to find much concurrence of other men’s opinions; and if the stockholders, whoever they may be, conduct the affairs of the bank prudently, the expectation is always, of course, that they will make it profitable to themselves, as well as useful to the public. It has been found by experience that banks are safest under private management [as the Second Bank of the US was], and that Government banks are among the most dangerous of all inventions.

In light of the more recent doctrine of Look Forward, Not Backward, this is also an interesting comment from the same speech:

The President is as much bound by the law as any private citizen, and can no more contest its validity than any private citizen. He may refuse to obey the law, and so may a private citizen; but both do it at their own peril, and neither of them can settle the question of its validity.

Jackson’s greatest antagonist, though, was a genuine reactionary who rejected the classical liberal principles of democracy and rejected the American Constitutional form of government: John C. Calhoun. Calhoun was the mastermind behind the South Carolina articles of nullification which purported to annul federal tariffs in South Carolina and provoked the confrontation with President Jackson and Congress known as the Nullification Controversy. Calhoun spent the rest of his life promoting various seditious schemes in support of slavery and its expansion.

As the events of the three decades between the Nullification Controversy and the Civil War were to show, the Calhounian approach to defending slavery was deeply reactionary, opposed to basic classical liberal principles of the rights of the individual. In practice, it lead to greater and greater restrictions on the personal freedoms and even “states rights” of the free population, and eventually issued in armed revolt against the Constitutional government aimed at its overthrown and replacement by a slave republic, at least in the states of the Southern Confederate.

Robin refers to Calhoun’s opposition to Congress receiving anti-slavery petitions. John Quincy Adams, elected to the House of Representatives from Massachusetts after leaving the Presidency, was a leader in the effort to have Congress receive the antislavery petitions. Although it sounds now like a dry procedural issue, Calhoun and the defenders of slavery understood it to be something that would validate the growing antislavery movement. Adams was acting as a conservative within the classical liberal framework as President when he defended the Second Bank of the United States and generally tried to protect the illegitimate influence of the wealthy on government. He was also acting very much within the classical liberal tradition when he lent his prestige as the former President and son of the second President to the antislavery cause. Abolition rested firmly on classical liberal principles, although the Abolitionists obviously wanted to change the Constitution to ban slavery. (Though some argued that it already did!)

Another significant movement arose during Jackson’s Presidency, the Anti-Masonic Party. They were crackpots who spun lurid, false tales about crimes committed by members of Masonic Lodges. They also would count as a distinctively reactionary movement who rejected the classical liberal consensus on government and society.

Historian Richard Hofstadter was correct in identifying the Anti-Masonic Party as representing the first movement in America recognizable as a similar type to the Radical Right organizations of the 20th century such as the John Birch Society. It was genuinely reactionary and anti-democratic, drawing on European conspiracy theories spawned by the counterrevolutionary reaction to the French Revolution that held democracy to be part of a dangerous, corrosive plot by secretive, sinister figures, in this case in the Masonic Lodges. (Like most conspiracy theories that win adherents beyond the merest handful of cranks, it had a small touch of reality to it. Masonic Lodges did actively promote democracy and were prominent in the movements for independence and republican government in Latin American nations like Mexico and Argentina.)

Continued in Part 3

Tags: corey robin, reactionary mind

Angie: our plans to control Europe are proceeding nicely

2012-01-09T11:49:00.000-08:00

These reports each emphasize a different angle on the Merkozy summit of Monday.

Shorter Angela Merkel: Ve are making progress on how to punish zhose who do not obey my orders!

From Aljazeera English, EU financial pact 'by March 1st' 01/09/2012:

From Euronews, Financial tax backed by Germany and France 01/09/2012:

From Reuters, Merkel tells Greece to speed up debt deal 01/09/2012

Tags: angela merkel, eu, euro, european union, nicolas sarkozy

The weakness of US banks

2012-01-09T11:43:00.000-08:00

Ed Harrison writes in The expansionary fiscal contraction bust Credit Writedowns 01/08/2012:

If you argue that austerity works in cutting deficits over the longer-term but the short-term pain is worth it, that’s a different argument than the one Republicans are making – and one not likely to get one elected, which is why they’re not making it. But even so, the spectre of debt deflation looms heavily as much in the US as in Europe. After all, BofA is not trading in the single digits because of irrational despondence. The banking sector in the US is still very sick – and will remain so for the foreseeable future. [my emphasis]

Debt deflation means when the value of debt held by the lender as an asset decreases. A bond purchased at a market price of $1,000 may decrease in its market value due to changes in the borrower's credit status. A decrease in assets with liabilities unchanged means a decline in the equity ratios of the lender and therefore a higher vulnerability of the lender to unfavorable business and economic events.

The best time to tackle the real problems of the banks was in 2009 when the Obama Administration first came to office and had maximum credibility among the public in undertaking to fix the problems of the financial sector. Obama's timidity and deference to the financial lobby had seriously negative consequences.

A crackup in the eurozone - a very possible and likely event - could take down some big American banks and compound US economic problems.

President Obama was being cautious in 2009 in his approach to the financial crisis. After the recklessness of the Cheney-Bush Administration, caution didn't look all bad. But sometimes caution produces sub-optimal decisions and policies.

Tags: us economy, world economic crisis

Republicans, Party of the proletariat?

2012-01-09T10:46:00.000-08:00

That's what David "Bobo" Brooks would have us think, anyway. And someday I'm going to find out how the word "proletariat" leaked into English to mean "working class" when "working class" is a perfectly good English version. I know who transitioned it from French into German (conservative Catholic social theorist Franz von Baader), but not how it made it into English.

In any case, Charlie Pierce in This Is Why Mitt Romney Is Unemployable Esquire Politics Blog 01/09/2012 explains that the depression has brought overt class factors more to the front of American politics, despite Rick Santorum's bizarre claim that America is a classless society and therefore it's a sin for a Republican to use the phrase "middle class". Pierce:

It's becoming abundantly clear that, all Santorum aside, this election is fundamentally going to be about class. The Republicans already have talked about blue-collar jobs and middle-class anxiety more in this cycle than they have in the previous two or three combined. And, even if the Republicans had given the whole business a good leaving-alone, the White House is going to force the issue anyway. Unemployment is not going to drop below eight percent before the election. The income gap is not going to go away, either. The basic inequities forced on the country by the looting of the economy in the first decade of the century are alive and well. They are going to bite hard at both parties. But only one candidate is so uniquely vulnerable to their political effects.

He also notes with a jab at the punditocracy, "I suspect, though, it just might have a little something to do with the Occupy people who, as we all know, have no coherent agenda that anyone can identify."

Our Pod Pundits, and more generally the hermetically isolated group we still call our political press corps, are notorious for adopting "scripts" about candidates, as Bob "the Daily Howler" Somerby elaborated well in the years before he fell in love with the Tea Party. As soon as Rick Santorum began to look like a serious candidate for the Republican nomination, they settled on a script for him in which he is the "working class" candidate.

Bobo flogged the idea in two columns last week. Ron Brownstein, another thoroughly conventional pundit, took it up in Santorum's Appeal National Journal 01/05/2012. Like Bobo, he wants to describe the evolving demagoguery of the Republican Party without reference to the decades-long Southern strategy that now has Republican Presidential candidates making undisguised racial appeals to their white base:

The first sign of the populists’ growing influence was in the presidential runs of conservative commentator Patrick J. Buchanan in 1992 and 1996. Buchanan, a brilliant if often intemperate political packager, offered a combustible mix of social conservatism, protectionism, isolationism, nativism, and populist attacks on elites that all embodied the embattled sense of decline among many blue-collar Americans. After shocking Bob Dole in the 1996 New Hampshire primary, Buchanan’s “peasants-with-pitchforks” crusade fizzled in South Carolina. But he demonstrated that there was an audience within the GOP for an edgy collection of views that unnerved the party’s traditional business-oriented leadership. [my emphasis]

It's part of the conceit among the Beltway Village that they are really in touch with Real Americans, aka the "white working class" in Bobo's formulation. And because they know the Real Americans so well they know that what appeals to them is that "combustible mix of social conservatism, protectionism, isolationism, nativism, and populist attacks on elites." Pat Buchanan's appeal in the Republican primaries in the 1990s turned out to be limited, as Brownstein notes there. But why let inconvenient facts spoil a good script?

This is an interesting glimpse at the Village outlook:

With equal passion, Santorum pledges both to end abortion and revive American manufacturing (albeit through tax cuts, not the trade barriers Buchanan favored). Within minutes at the same appearance, he can alternately sound like Pat Robertson and Dick Gephardt.

In 2008, the GOP primary electorate was split almost in half between voters with and without a college education, the line that generally divides the managers and the populists. Romney is a comfortable choice for all but the most ideological managers. Santorum will become a serious threat to Romney only if he can unite the populists.

In his views, style, and background, Santorum should be a much easier fit for those voters than Romney. But it’s not clear that Santorum, any more than the rest of the Republican field, has fully contemplated the implications of an electoral coalition that now relies so heavily on blue-collar and older whites. While most of those voters passionately oppose government spending they view as transfer payments to the undeserving, they are equally determined to protect the programs they believe most benefit them - Social Security and Medicare. [my emphasis]

It's an article of faith among even Village pundits (like Mark Shields) who must surely know better that it's absolutely essential that Social Security and Medicare ("entitlements") have to be slashed or done away with entirely. But here Ron Brownstein displays at least momentary awareness that these programs are very popular.

Brownstein's eliding of the Republican base into "blue-collar" Real Americans is a bit more sophisticated than Bobo's. But it's essentially the same trick. They are coming from the same assumption: the Real Americans are uneducated and bigoted and they support the Republicans for unworthy reasons. Unlike Establishment pundits who admire Republicans for wanting to slash "entitlements" and let Grandma eat catfood.

Using college education as a dividing line between "working class" and others is common among our Pod Pundits. I haven't dug into the voting statistics recently to see just how that assumption is wrong. But it's a lazy and misleading assumption even on its face. If we use any half-reasonable definition of working class, it would include both factory and office workers in non-management roles. And a large portion of that group has some college education or a college degree. On the other side of the definition, some considerable portion of non-college educated people work as contractors, store owners, or as other kinds of small businesspeople, forming a considerable portion of the classic "lower middle class".

The advantage to Republicans of having an image around election time of being the Party for working people is obvious. Why our Big Pundits accept it so lazily is another question.

Ben Adler at The Nation does a good takedown of this notion in Rick Santorum Is Not a 'Working-Class Candidate' 01/05/2012. Will his policies really appeal to working-class voters generally? Adler writes, "The totality of Santorum’s domestic policy agenda is to cut spending. This shouldn’t even pass for conservative economic populism."

In another column, Republican Candidates Attack Labor 01/09/2012, Adler comments on the fact that the current crop of Republican Presidential candidates are overtly hostile to organized labor. There was a time, not so long ago, that Republicans in a Presidential race would at least pretend to have some kind of tolerant attitude toward unions. Adler writes, "Gearing up for their January 21 primary in the notoriously anti-union state of South Carolina, Republican presidential candidates have recently begun demonizing organized labor."

Tags: labor movement, santorum, republican party

Nick and Angie's pre-summit mini-summit

2012-01-09T09:22:00.000-08:00

The Merkozy duo, German Chancellor Angela Merkel and French President Nicolas Sarkozy, met in Berlin Monday to prepare for the EU summit at the end of this month.

This is high politics and diplomacy, so it's better not to read too much into the public posturing over a meeting like this. One result of it is Nick got Angie to half-heartedly agree to a financial transaction tax (some form of what's also called a Tobin tax). Nick is up for re-election in May of this year and he needs some positions that he can take to the voters that aren't shameless pandering to the one-percenters. Angie gave him her "personal" agreement, whatever that means. Part of what it means is that at least the Free Democratic (FDP) part of her coalition government opposes it. But then, she could probably get the Social Democrats (SPD) to vote for it if she were serious about it.

Nick also managed to mention growth and jobs. But whether that indicates even a shadow of a divergence from Princess Angie von Merkel's insistence on austerity policies for all isn't obvious. Sarkozy and even Italian Prime Minister Mario Monti are trying to bring some pressure on Angie to agree to something that looks more like a stimulus package for Europe's economy, in which even the German economy is showing clear signs of going into recession again.

Some of Germany's bonds are for the first time selling at a real interest rate below zero, as have 3- and 5-year US bonds and even 10-year US bonds recently. This means that investors are willing to pay Germany to hold their investments in their sovereign debt, which is perceived as a safe haven.

This is good news for the German government's own borrowing needs. If Angie weren't such a stone conservative on economics, she would even use the opportunity to borrow. Negative interest rates on your bonds? Where's the downside in borrowing at negative interest rates?

But it's not necessarily a good sign for the eurozone. If investors are flocking to perceived safe havens - German bonds, US bonds, central bank deposits - it may also mean they are pulling back on lending to businesses and also are less willing to buy riskier eurozone countries' bonds.

Greece continues to skate on the brink of bankruptcy. The basics of Greece's situation haven't changed in the last few weeks. Greece will have to have even more writedowns than what their private creditors have agreed to accept, although the IMF is saying that the "haircuts" agreed to so far are sufficient. And as long as they are forced to operate under the EU/ECB/IMF "troika" demands for austerity policies in the middle of this depression, their debt situation will continue to worsen.

This is a mess. And what former Portuguese President Mário Soares says is true: if Angie had provided the necessary support for Greece in time, Europe wouldn't be in the current crisis situation. (Antonio Jiménez Barca, “La generación actual de políticos europeos no sabe decir no” El País 09.01.2012)

Angie and Nick will also be having separate high-profile meetings this week with Italian Prime Minister Mario Monti, the unelected head of the debt-collectors government they installed in Rome.

In a break from Angiedoxy, the American-educated head of the Czech central bank basically says the current Merkozy policy is not going to save Greece (Czech banker: Greece quit euro unless 'massive' funds given Athens News 01/09/2012):

Greece should leave the eurozone and devalue its new currency unless Europe is willing to provide "massive" funding for the indebted country, Czech central bank Governor Miroslav Singer said in a newspaper interview.

Singer told daily Hospodarske Noviny Europeans should focus on helping banks which may need recapitalisation and on issues that can be resolved, rather than devoting attention for years to Greece which represents just two percent of the European economy.

"If there is not the will to give Greece a massive amount of money from European structural funds, I do not see any other solution than its departure from the euro zone and a massive devaluation of the new Greek currency," he said in the interview to be published on Monday.

The key problem in the debt crisis has always been the European banking crisis. Angie and Nick have been using the sovereign debt crisis to address the weakness and undercapitalization of European banks through backdoor methods like subsidizing Greece's impossible debt payments, and the ECB and other central banks buying troubled sovereign debt from private banks to move risk to the public rather than private banks. As Miroslav says, "In connection with the Greek crisis, it will possibly be necessary to pour money even into quite large banks which will suffer losses. It is necessary to immediately focus on banks' problems."

A key aspect of what Angie calls "fiscal union" but is in reality only partially so is that all 26 governments in the EU-minus-one (the UK is the minus one) should agree to have the EU (read: Angie) have the final say over their national budgets. Sarkozy is pitching this idea as not additionally infringing on the sovereignty of the member country, which is quite an imaginative reading of it. It's difficult for me to believe that a number of EU countries won't balk at this before the end of March, Angie's deadline for the agreement to be approved. Especially since it's tied to a dogmatic, non-reality-based austerity economics conception that will only make the current economic and debt situation in the EU worse. I may be surprised. But it's hard for me to imagine that will fly.

See:

Juan Gómez, Merkel y Sarkozy refuerzan su apuesta por salvar el euro El País 09.01.2012

Deutschland leiht sich Geld zu negativen Zinsen Frankfurter Allgemeine Zeitung 09.01.2012

Cerstin Gammelin, Deutschland und Frankreich gegen die Schuldenkrise.Genug gespart, Kanzlerin Süddeutsche Zeitung 09.01.2012

EU, bondholders seek swift PSI deal Athens News 01/08/2012

Ricardo Martínez de Rituerto, Merkel y Sarkozy tratan de acercar posiciones para mantener el euro a flote El País 08.01.2012

Tags: angela merkel, eu, euro, european union, nicolas sarkozy