Imagine the Federal Reserve Bank — as run by Congress!


Click to enlarge

Increasing political encroachment on the Federal Reserve, particularly from the Republican Party, could threaten the central bank’s hard-won independence and undermine confidence in the nearly 100-year old institution.

That was the pervasive sentiment among economists gathered at the Fed’s annual monetary policy symposium in Jackson Hole, Wyoming. Against the dramatic backdrop of the Grand Teton mountain, many said a closely-contested presidential race has turned the monetary authority into a political football…

The primary topic of conversation at the rustic mountainside resort was whether or not Fed Chairman Ben Bernanke and his colleagues would deliver another round of monetary stimulus soon.

But, when probed on the issue on the sidelines of the meeting, many participants voiced concern about the heated political rhetoric aimed at the Fed, including a bill that would audit the conduct of monetary policy that is gaining increasing traction among Republicans.

The Fed is already subject to regular audits, but congressman Ron Paul’s bill would remove an exemption for monetary policy deliberations.

Ironically, the complete political gridlock that characterizes U.S. fiscal policy has left the Fed in the difficult position of being “the only game in town.”

Both the Fed and the independent Congressional Budget Office have said a looming “fiscal cliff” of spending cuts and expiring tax breaks at the end of this year could shove a fragile economy into a new recession.

Given the track record of Congress as a whole – and Congressional Republicans as leading incompetents – can you imagine the disaster of having a central bank beholden to the political clown show? Our nation’s credit rating would be lower than Bangladesh.

The worst of it would be losing the so-called dual mandate in place since 1977. Republicans couldn’t care less about the lot of American unemployed and the first thing they’d remove would be that portion of the mandate. And, of course, like journalists and politicians alike, they don’t know there actually is a triple mandate. Basic monetary policy and balanced employment is joined with moderating interest rates throughout our economy.

Cripes! Congress has an approval rating of 16%. Congressional Republicans are even lower. Would you hire someone like that to run a bank?

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Basque country has economic lessons for Spain

Spain’s dash into tourism in the 1970s and its property boom last decade largely passed by the Basque region, a cool, damp corner of the north with a reputation for separatist violence. Instead the Basques stuck with industry, by force of circumstance.

Euskadi, the Basque name for the hilly province of 2 million bordering France, now outshines the rest of Spain with a better credit rating than central government, the lowest regional unemployment and borrowing costs half those of other areas…

The Basque region’s secret has been in sticking to manufacturing over the property and tourism industries that ended in economic misery elsewhere in Spain when a real estate bubble fuelled by easy credit burst in 2009…

The Basque Country is Spain’s fifth largest regional economy, with a gross domestic product of 66.1 billion euros, meaning it accounts for around 7 percent of national GDP. The region’s exports are more or less evenly balanced between the rest of Spain and markets beyond Spanish borders.

Its deficit-to-GDP ratio is just 0.25 percent, compared with nearly 90 percent for the central state. It has the lowest unemployment rate in Spain at 13.55 percent, compared with 24.4 percent nationally…

The region, at Spain’s border with continental Europe, is rich in natural resources. A cradle of the iron and steel industry, it was an obvious choice as a manufacturing base.

“There was a clear bet on industry here, a bet on those traditional sectors, such as iron, steel, energy and small and medium-sized companies that make all those components for the energy and car sectors, that make things that you can hold in your hand,” Jose Luis Curbelo, director general of the Basque Institute for Competitiveness, said.

That is the secret of the Basque economy,” he said. “Basque industry immediately internationalized, whether that was by producing components and gadgets for overseas companies, or by setting up shop and manufacturing abroad.”

“That process was much faster and much more committed than in the rest of Spain, so the collapse in the domestic market hasn’t affected Basque companies as much. A lot of their sales are global and they can withstand the crisis in better shape.”

RTFA for details, anecdotal tales and reasonableness of a people oppressed by fascists and democrats alike – who survived both.

Yes, you should expect a cranky Celtic geek like me to feel a bit extra love for a cranky Celtic people. The Basque nation is as independent-minded as a highlander — often as intolerant of their own species of Sassenach as well. Fortunately, arguing with the central government in Madrid never brought dedicated self-sufficiency to a halt.

George Galloway hails ‘Bradford spring’ as he kicks Labour butt


Here’s George Galloway sticking a finger in the eye of our Congressional liars and hypocrites
 
George Galloway has said his surprise victory in the Bradford West by-election showed the “alienation” of voters from the main political parties. The Respect Party politician said his win also reflected concerns about jobs and the economy – and was not just based on the support of Muslim voters.

Labour’s Ed Miliband said the loss of the seat was “incredibly disappointing”…he said “local factors” were partly to blame but pledged to “learn lessons” from the defeat.

But the BBC’s chief political correspondent Norman Smith said the poll, coming at the end of a difficult week for the coalition government, should have been a “stroll in the park” and that there were questions whether the Labour leadership could connect with its core supporters.

Mr Galloway, expelled by Labour in 2003, won the by-election by 10,140 votes, in the process of overturning a Labour majority of more than 5,000 at the 2010 general election.

He told the BBC that his win represented a “peaceful democratic uprising” against the established political parties and their leaders…

How did he win? Firstly, he appears to have galvanised some who feel ignored, even disenfranchised by the main political parties…

For others, in a multi-ethnic constituency, the call for the immediate withdrawal of troops from Afghanistan was appealing.

For others still, this was a mid-term by-election. It wasn’t about choosing the next government, but sending a powerful message, selecting a noisy, high profile advocate to represent them.

Handing George Galloway a 10,000 vote majority certainly does that

The Conservatives, who came third in the by-election with 2,746 votes, also saw their vote fall by more than 20%…

The Lib Dems came fourth and lost their deposit.

Bravo, George. One of the noisier independent voices for ordinary working people in British politics. Someone who stuck to his guns during the years of Blair/Bush bedsitters.

About half of Americans trust the White House, hardly anyone trusts Congress — how many trust the Supreme Court?

An overwhelming majority of Americans think that the Supreme Court justices’ political views will influence how they vote on the Obama health care reform cases…

Respondents were asked “The U.S. Supreme Court will soon decide the constitutionality of the health care reform law signed by President Obama in 2010. Do you expect the Court will make this decision based solely on legal merits, or do you expect politics will influence how some justices vote? ”

The poll found 75 percent of Americans think politics will influence the justice’s votes, while 17 percent think they will vote solely on the legal merits, and 8 percent aren’t sure.

Respondents who described themselves as politically independent were most skeptical of the justices’ ability to keep politics out of their decision making process; 80 percent of independents thought politics would influence the justices. Of Republicans, 74 percent thought politics would play a factor, while just 65 percent of Democrats thought politics would influence the outcome.

This is the result of decades of Republicans making revision of the Supreme Court a central task of every Republican presidency – and Democrats lacking the backbone to fight for an independent judiciary. While we’ve seen dry academic polls lay out this change starting with the Reagan years — till now, there was some conviction that the conservatives on the bench would continue to spell the word with a small “c”. This poll demonstrates that the American people have no belief in that being true at all.

We all know the level of contempt felt for the corruption factory that is Congress. And the nation – divided as it is in response to the ideologues of the Right and Religion who preach division – stays divided over the residents of the White House. But, it is a new state of affairs when the third branch of our tripartite government has plunged to the same depths of perceived crony corruption as the rest of government.

I guess we can give special thanks to the Republican Party, once again, for the reintroduction of class warfare to the United States.

From the archive, 1 February 1948 — An interview with Gandhi


Interview by Alan Moorehead

It is the violence of Gandhi’s death, this complete and contemptuous negation of everything he lived for, which is the shocking thing. Yet paradoxically, this is the aesthetic end to a life of non-violence, the end which, one imagines, the old man would have chosen for himself.

I remember, in the very middle of the war, I went as a war correspondent to interview him in Delhi. It was an excessively hot afternoon and I sat cross-legged on the floor sweating through my army uniform. Gandhi leaned back on a white bolster, wearing nothing but a loincloth, and he said amiably: “What is the good of our talking? You and the people you represent are committed to violence. I am interested only in non-violence. We have nothing to say to one another.”

I asked him if he was prepared to see the Japanese invade India (they were then very close in Burma) “Why not?” he said. “They can’t kill us all.” He went on to propound his famous doctrine: never oppose violence with violence. “Non-violence,” he said, “requires an even higher kind of courage than violence. You must be just as prepared to lay down your life – even more so.” I remember how cheerful he was that afternoon, how healthy with his great brown barrel of a chest, and how wittily he talked.

Nor was he much changed when I went to one or two of his prayer meetings in Delhi this winter. He was still getting up at four in the morning to exercise, he was still the nimblest (and I think the gayest) good brain in India, and he was still talking in parables on precisely the same theme.

Of course he becomes a martyr now; more than that – a mystical legend and a god. It is probably a waste of time trying to assess him in western terms. Inevitably, the mysticism and the fatalism intervene, blocking out all logic. I do not think Jawaharlal Nehru and the others ever expected practical politics from Gandhi, but they were inspired by him just the same. They loved him passionately.

I never met anyone in India who came away from a meeting with the old man without being captivated and in a slightly elevated condition of mind. He had an overpowering charm under that humility. He talked hard common sense as a rule and the mysticism ran between the lines.

What happens now? It seems almost impossible to be optimistic. The country has lost its figurehead, its living public conscience. Who is to speak against racial hatred now with that authority? The British kept the peace with police and prestige and Gandhi did it with love. Now, within six short months, both police and love have vanished together. Perhaps enough of his followers will obey his creed of non-violence. Whatever the immediate effect may be, at least his influence in the long run can only be for the good.

He has been missed in so many ways.

Pic of the Day

Looks like the Brits – and especially the Tories – are getting worried about for-real devolution, this time. This is a fiery topic with old mates of mine in Progressive politics in the UK coming down on both sides of the question. As a “child” of the Highland Clearances, I’m a supporter of sovereignty for Scotland. Causes more pub rows than an Auld Firm derby.

Netherlands apologises to Indonesia for 1947 Rawagede massacre


Dutch Ambassador Tjeerd de Zwaan throws petals over graves at the Rawagede Hero Cemetery

The Dutch government formally apologised Friday for a 1947 massacre on Indonesia’s Java island, in an emotional ceremony on the anniversary of the executions by its colonial army.

Dutch troops swooped into a village in the town of Rawagede during Indonesia’s fight for independence and executed men and boys as their families and neighbours looked on. Dutch officials say 150 people were killed, but a support group and the local community say the death toll was 431.

“In this context and on behalf of the Dutch government, I apologise for the tragedy that took place in Rawagede on the 9th of December, 1947,” the Netherlands ambassador to Indonesia Tjeerd de Zwaan said.

He then repeated the apology in the Indonesian language, to the applause of hundreds of people attending the ceremony, some of whom broke down in tears as they listened in front of a marble monument commemorating the dead.

In a landmark ruling, a Hague-based civil court in September found the Dutch state responsible for the executions and ruled in favour of eight widows and a survivor of the massacre who lodged the case. Two of the widows have since died, and so has the survivor, Saih Bin Sakam, who passed away in May at the age of 88…

One of the widows, 93-year-old Anti Rukiyah, said she was relieved to finally receive an apology, and would use the compensation money to help her children buy a home…

Indonesia’s Foreign Minister Marty Natalegawa praised the Dutch government for making the apology.

I live in a land where fools in one political party condemn members of the other as unpatriotic cowards for “apologizing for America”. Slavery and genocide never happened in this Land of Liberty – if you listen jaw agape to the pronouncements of Republicans, Kool Aid Partygoers and the Blue Dog flavor of spineless Democrat.

Someday, no doubt when I will have shuffled off this mortal coil for a century or two, American education will have progressed sufficiently to produce a generation or two of adults who embrace an ethical view of history.

In 2011, the 4th of July has become Independents Day

As we celebrated Independence Day at the start of a long hot campaign season, it is worth remembering that patriotism is not the same thing as partisanship.

Our first president, George Washington said, “I was no party man myself, and the first wish of my heart was, if parties did exist, to reconcile them…”

And the third president — and author of the Declaration of Independence, Thomas Jefferson, observed: “I never submitted the whole system of my opinions to the creed of any party of men whatever in religion, in philosophy, in politics, or in anything else where I was capable of thinking for myself. Such addiction is the last degradation of a free and moral agent. If I could not go to heaven but with a party, I would not go there at all…”

The fact is that 41% of Americans describe themselves as independents — as opposed to Democrats or Republicans — according to an April Washington Post/ABC News poll. Independents are the largest and fastest-growing segment of the electorate. Back in 1945, they made up 15%…

…And the growth of independent voters has occurred precisely as the two parties have become more ideologically polarized than at any time in our recent history…

Continue reading

Missouri coppers “kill” cement alligator


Buy the mold and make lots of ’em for your yard

Police in a suburb in the state of Missouri recently encountered one tough alligator — or so they thought.

Officers in Independence, a Kansas City suburb, responded to a call on a Saturday evening about a large alligator lurking on the embankment of a pond, police spokesman Tom Gentry said.

An officer called a state conservation agent, who advised him to shoot the alligator because there was little that conservation officials could do at that time, Gentry said.

As instructed an officer shot the alligator, not once but twice, but both times the bullets bounced off — because the alligator was made of cement…

Gentry acknowledged the incident is drawing a lot of attention.

“In hindsight, it’s humorous,” he said. “But we have to take every call seriously.”

You could chuck a rock at the “critter” if no one’s seen it move in a day or two – before you open fire.

Any idea where the ricochet went?

Nearly 4 million southern Sudanese to vote on independence

Almost 4 million southern Sudanese, or roughly half the south’s population, have registered to take part in an independence referendum next week that is likely to split Africa’s largest country in two.

The U.S. State Department said it was optimistic ahead of the vote, which is due to begin in six days and marks the climax of a 2005 peace deal that ended a civil war in Sudan that killed at least 2 million people and destabilized much of the region…

Southerners are expected to vote to separate from the north and form a new nation.

“The total number of people registered in the south, in the eight countries abroad and in the states of northern Sudan is 3,930,916,” said Chan Reek Madut, a member of the referendum’s organizing commission.

The vast majority of voters are in the southern region. Only some sixty thousand registered in the diaspora and less than 120,000 in the north, amid accusations of voter intimidation and a fear of reprisals should the south separate…

The State Department’s Crowley said both the Obama administration’s special envoy for Sudan, Scott Gration, and Princeton Lyman, a veteran U.S. diplomat named to help negotiations between north and south, would be in Sudan for the vote, and said both sides appeared to be sending “the right signals” about the need for an open and credible process.

But he noted that the two sides remain split on key issues including border demarcation, the fate of the disputed region of Abyei, and the sharing of oil revenues — any of which could spark potential confrontation in the weeks following the referendum…

In order to be valid, the referendum requires that 60 percent of those registered turn out to vote.

Cripes. That wouldn’t work in the great democratic nation of the United $tates of America.

And, yes, I trust the government of Sudan about as far as I could throw them uphill into a heavy wind. These are the gangsters who still say they never knew Osama Bin Laden was training in their land back in the mid-80’s.

They didn’t know. The CIA didn’t know. Anyone who travelled through the region knew. But, official liars say they didn’t know. Hogwash!