Monthly Archives: July 2011

A fascinating read about the history of Left and Right

For a sociologist’s take on the history of Left and Right around the world, in politics, society and psychology, do read this interesting article from William Domhoff of the University of California, Santa Cruz.  I think it explains some of the semantics behind the Right’s demagoguery and the Left’s inability to counter it effectively.  There just seems to be a “natural” human bent toward the right, order, cleanliness, up, etc. that all relates to “right” vs. “left” that is difficult to counter.  All the studies cited point that way and it is very depressing to think that people’s altruistic tendencies towrd the group are so hard to elicit against all the forces of the right.


Barry always has it RIGHT!

His column today in the Washington Post is right on the money.  Basically, he reiterates that we should not blindly follow Europe off the austerity cliff, which will not help to create a recovery after this credit crisis:

Wall Street analysts and economists have this recession recovery wrong

The recession is well behind us now, and Wall Street seems to think this recovery should be all wrapped up.

Consider this: The federal non-farm jobs report for June was pretty awful. The private sector created 57,000 jobs. Federal, state and local governments cut 39,000 positions (the eighth straight monthly decrease in government employment). We picked up a mere 18,000 net new jobs.


No run-of-the-mill recession

No run-of-the-mill recession

Not a single forecaster in Bloomberg’s monthly survey of 85 Wall Street economists got it anywhere close to right. The most common reaction was “surprise.” That any professional can sincerely claim to be surprised by continued weakness — in employment, GDP or retail sales — was the only revelation.
Let’s put the number into context: In a nation of 307 million people with about 145 million workers, we have to gain about 150,000 new hires a month to maintain steady employment rates. So 18,000 new monthly jobs misses the mark by a wide margin.

Why have analysts and economists on Wall Street gotten this so wrong? In a word: context. Most are looking at the wrong data set, using the post-World War II recession recoveries as their frame of reference.

History suggests the correct frame of reference is not the usual contraction-expansion cycles, but rather credit-crisis collapse and recovery. These are not your run-of-the-mill recessions. They are far rarer, more protracted and much more painful.

Fortunately, a few economists have figured this out and provide some insight into what we should expect. Among the most prescient are professors Carmen M. Reinhart and Kenneth S. Rogoff. Back in January 2008 (!), they published a paper warning that the U.S. subprime mortgage debacle was turning into a full-blown credit crisis. Looking at five previous financial crises — Japan (1992), Finland (1991), Sweden (1991), Norway (1987) and Spain (1977) — the professors warned that we should expect a prolonged slump. These other crises had a number of surprisingly consistent elements:

First, asset market collapses were prolonged and deep. Real housing prices declined an average of 35 percent over six years, while equity prices collapsed an average of 55 percent. Those numbers were stunningly close to what occurred in the U.S. crisis of 2007-09.

Second, they’ve noted that the aftermaths of banking crises “are associated with profound declines in employment.” They found that following a crisis, the average increase in the unemployment rate was 7 percentage points over four years. U.S. unemployment climbed 6 percentage points (from about 4 percent to about 10 percent), while the broadest measure of joblessness gained over 7 percentage points (from about 9 percent to about 16 percent). Again, they were right on the money.

Third, the professors warned that “government debt tends to explode, rising an average of 86 percent.” Surprisingly, the primary cause is not the costs of bailing out the banking system, but the “inevitable collapse in tax revenues that governments suffer in the wake of deep and prolonged contractions.” They also warned that “ambitious countercyclical fiscal policies aimed at mitigating the downturn” also tend to be costly.

Hmmm, plummeting tax revenues just as the government tries to stimulate the economy . . . does any of this sound familiar? It should.

Read the rest here in the Washington Post, or on his blog,  here.

In conclusion, we are in for a long haul, no matter what we do, but austerity, or slashing government spending is the WRONG way to go, unless, like Republicans, you want to follow ideology and damn the little people, with no power, who will get hurt.



Another take on the WSJ :)

From the Washington Post:

An absolute must-read on Rupert Murdoch and the Wall Street Journal

As usual, Barry Ritholtz has called the Emperor naked again.  The WSJ has done an abysmal job of not reporting on the scandal of immense proportions going on all over Murdoch’s empire, the WSJ being one of his prize holdings.  This just proves what all of us thought when he bought it – that he was actually buying the mouthpiece for his political views and not buying a media asset for his business empire.  Just like Faux News – oops, I mean Fox News – it has just proven itself a tool of its owner and buried the story on page 16.  Do read it here.  It makes you shiver at what we call “the freedom of the press”.

Yet another take on socialized medicine

Last September, on a trip to Amsterdam, my husband took a side-trip over a sidewalk crack, fell on his face and ended up with bruised ribs, and battered elbow, knee, wrist, and a generally unhappy night in the hotel.  The next morning, we took a taxi to the central University Hospital, waited less than 5 minutes in the nearly empty waiting room, saw a nurse, then an ER doc in quick succession, had several X-rays of his elbow, wrist, knee, and ribs, and walked out after paying a $400 charge.  We had expected several thousands of dollars at the very least, and were more than pleasantly surprised, not only at the very delightful, complete and helpful service, but at the flat fee of $400.  Our insurance at home happily reimbursed all but the $100 deductible, and our travel insurance covered the rest.  So much for the dire scenarios of socialized care.

And now, I just read an almost identical case, in London:

I wonder what is wrong with our so-called unfettered “free” capitalist system, that for all the money we throw at it, we can’t get even close to decent care for what we already pay, and we can’t even cover the majority of people!!!  Our statistics on infant mortality and longevity and almost any standard for industrialized societies is dismal, yet as a whole, we continue to decry the push for “socialized medicine” as akin to moving to a communist state.  Hello, wake up and smell the kind and gentle care other countries give their citizens,AND their visitors!

Andy on Congress – what could be better?

New Law, ‘No Politician Left Behind,’ Would Pay Congressmen Based on Performance

Controversial Law Draws Howls of Protest from Lawmakers

WASHINGTON (The Borowitz Report) – A government think-tank today proposed a controversial new law, “No Politician Left Behind,” which would pay congressmen solely on the basis of performance.

The law, which was proposed by the University of Minnesota’s Institute of Government, “would make a serious dent in the Federal deficit because few if any congressmen would ever have to be paid,” said the Institute’s director, Davis Logsdon.

“Right now, congressmen get paid even when they storm out of budget negotiations in a hissy fit,” Mr. Logsdon said.  “Under this new law, the rule would be, no budget, no paycheck.”

The idea of being paid per accomplishment drew howls of protest from lawmakers, many claiming that if the law were enacted it would result in their financial ruin.

“If passed, this law would be tantamount to the establishment of ‘Work Panels,’ which would determine whether individual congressmen are accomplishing anything,” said Rep. Eric Cantor (R-VA).  “I, for one, would be in deep, deep trouble.”

“I’m fairly sure that this law is unconstitutional,” said Sen. Mitch McConnell (R-KY). “Now, I have never actually read the Constitution, but if this law were passed I would probably be forced to read it or live in a cardboard box.”

House Speaker John Boehner (R-OH) said that creating performance standards for lawmakers was “an insult to the institution of Congress.”

“We have spent millions of dollars, some of it out of our own pockets, to get to Washington,” he said.  “We did not come here to be treated like teachers.”  Get a free subscription to Borowitz Report here.

Andy Borowitz on Rupert Murdoch – as usual – funny as hell :)

Disgusted, Satan Returns Murdoch’s Soul

Media Titan Loses Closest Ally

LONDON (The Borowitz Report) – In a blow that many insiders saw as the last straw for embattled media titan Rupert Murdoch, Satan today returned Mr. Murdoch’s soul to him and demanded his money back.

“Rupert Murdoch has done my bidding for decades, but that relationship is now terminated,” read the terse statement from the Prince of Darkness, who close associates said has been “disgusted” by Murdoch’s recent activities.

Purchased by Satan in Melbourne, Australia in 1951, Mr. Murdoch’s soul is estimated to have a current value of nine dollars (US).

Around the media world, observers were stunned by this latest setback for Mr. Murdoch, who in Satan is losing one of his closest and most powerful allies.

But according to Ian Langramstone, who at his post as the University of Nottingham has studied Mr. Murdoch’s relationship with Satan for years, the slap in the face from the Lord of Misrule should not come as a surprise.

“Satan never wants to be the last one to desert a sinking ship,” said Mr. Langromstone.  “He always takes his lead from British politicians.”

In what many saw a tacit admission of the depth of his current problems, Mr. Murdoch today cancelled plans to purchase the remainder of the British government that he does not already own.

Elsewhere, pitcher Roger Clemens celebrated his steroid case being declared a mistrial by throwing a car across the courthouse parking lot.