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kpete

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Member since: Fri Sep 17, 2004, 03:59 PM
Number of posts: 44,143

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KRUGMAN: demolishes austerity economics

How the Case for Austerity Has Crumbled
JUNE 6, 2013
Paul Krugman

...........



Neil Irwin’s The Alchemists gives us a time and a place at which the major advanced countries abruptly pivoted from stimulus to austerity. The time was early February 2010;the place, somewhat bizarrely, was the remote Canadian Arctic settlement of Iqaluit, where the Group of Seven finance ministers held one of their regularly scheduled summits. Sometimes (often) such summits are little more than ceremonial occasions, and there was plenty of ceremony at this one too, including raw seal meat served at the last dinner (the foreign visitors all declined). But this time something substantive happened.

“In the isolation of the Canadian wilderness,” Irwin writes, “the leaders of the world economy collectively agreed that their great challenge had shifted. The economy seemed to be healing; it was time for them to turn their attention away from boosting growth. No more stimulus.”



....................


How decisive was the turn in policy? Figure 1, which is taken from the IMF’s most recent World Economic Outlook, shows how real government spending behaved in this crisis compared with previous recessions; in the figure, year zero is the year before global recession (2007 in the current slump), and spending is compared with its level in that base year. What you see is that the widespread belief that we are experiencing runaway government spending is false—on the contrary, after a brief surge in 2009, government spending began falling in both Europe and the United States, and is now well below its normal trend. The turn to austerity was very real, and quite large.




.................


This raises the obvious question: Why did austerity economics get such a powerful grip on elite opinion in the first place?



So is the austerian impulse all a matter of psychology? No, there’s also a fair bit of self-interest involved. As many observers have noted, the turn away from fiscal and monetary stimulus can be interpreted, if you like, as giving creditors priority over workers. Inflation and low interest rates are bad for creditors even if they promote job creation; slashing government deficits in the face of mass unemployment may deepen a depression, but it increases the certainty of bondholders that they’ll be repaid in full. I don’t think someone like Trichet was consciously, cynically serving class interests at the expense of overall welfare; but it certainly didn’t hurt that his sense of economic morality dovetailed so perfectly with the priorities of creditors.

It’s also worth noting that while economic policy since the financial crisis looks like a dismal failure by most measures, it hasn’t been so bad for the wealthy. Profits have recovered strongly even as unprecedented long-term unemployment persists; stock indices on both sides of the Atlantic have rebounded to pre-crisis highs even as median income languishes. It might be too much to say that those in the top 1 percent actually benefit from a continuing depression, but they certainly aren’t feeling much pain, and that probably has something to do with policymakers’ willingness to stay the austerity course.


................

(imho) This is a Krugman piece on the subject
(perhaps some of you can add some snippets...?)
From NYT Review of Books Section:
http://www.nybooks.com/articles/archives/2013/jun/06/how-case-austerity-has-crumbled/?page=1

"Repubarians"

CAGLE on IRS - Brutality vs. Generosity

☮☮☮☮☮☮☮

There is a memo floating around that says "Republicans fabricate controversies"...... Next?

Paul Claims Revealing IRS Memo Exists

Sen. Rand Paul (R-KY) told CNN there was a "written policy" floating around the agency that said IRS officials were "targeting people who were opposed to the president."

Said Paul: "And when that comes forward, we need to know who wrote the policy and who approved the policy."

When pressed for details about the memo he was referring to, Paul said he hasn't seen such a policy statement but has heard about it.

http://politicalwire.com/archives/2013/05/19/paul_claims_revealing_irs_memo_exists.html

************

Greg Morgan

Ah. So he hasn't actually seen the memo. He just heard that it exists, and somehow, magically, knows what is in it even though he hasn't seen it. You know what I heard? I heard that Rand Paul has robbed 24,763 banks, netting $4,587,235 in ill-gotten gains. I also heard that he is addicted to heroin, and that he has completely worn out his reproductive organs through self-abuse. I'm not sure if any of this is true, but I did hear it. And Rand Paul has yet to deny a word of it, so wouldn't it be reasonable to conclude that it's all true?

May 19, 2013 03:07 pm at 3:07 pm |

The Lie Matters: What Did Sen Coburn Know about the Edited Benghazi Email and How Did He Know It

Joy Reid dropped a little Benghazi lying leaker bomb yesterday on the Reid Report blog. A trusted source of hers told her to look at the Senate Committee on Homeland Security and Government Affairs. One person who stood out to her was Senator Tom Coburn (R-OK), who was on Morning Joe on May 9th, the day before the now debunked Benghazi email bombshell, claiming that there were “glaring omissions” in what was given to the intelligence committee, but that he couldn’t talk about it yet.

Senator Coburn appears to be referencing the email that was edited and shopped by “Republicans on Capitol Hill” to media outlets, and picked up by the gullible rube Jonathan Karl at ABC, as well as repeated by The Weekly Standard and a CBS reporter. This suggests that he saw the edited version of the email that was leaked by Republicans.

http://www.politicususa.com/day-benghazi-email-sen-coburn-referenced-glaring-omission-talk.html

Let America be America Again

SUNDAY, MAY 19, 2013
Sunday Poetry: Langston Hughes


Let America be America Again

Let America be America again.
Let it be the dream it used to be.
Let it be the pioneer on the plain
Seeking a home where he himself is free.

(America never was America to me.)

Let America be the dream the dreamers dreamed--
Let it be that great strong land of love
Where never kings connive nor tyrants scheme
That any man be crushed by one above.

(It never was America to me.)

O, let my land be a land where Liberty
Is crowned with no false patriotic wreath,
But opportunity is real, and life is free,
Equality is in the air we breathe.

(There's never been equality for me,
Nor freedom in this "homeland of the free.")

Say, who are you that mumbles in the dark?
And who are you that draws your veil across the stars?

I am the poor white, fooled and pushed apart,
I am the Negro bearing slavery's scars.
I am the red man driven from the land,
I am the immigrant clutching the hope I seek--
And finding only the same old stupid plan
Of dog eat dog, of mighty crush the weak.

I am the young man, full of strength and hope,
Tangled in that ancient endless chain
Of profit, power, gain, of grab the land!
Of grab the gold! Of grab the ways of satisfying need!
Of work the men! Of take the pay!
Of owning everything for one's own greed!

I am the farmer, bondsman to the soil.
I am the worker sold to the machine.
I am the Negro, servant to you all.
I am the people, humble, hungry, mean--
Hungry yet today despite the dream.
Beaten yet today--O, Pioneers!
I am the man who never got ahead,
The poorest worker bartered through the years.

Yet I'm the one who dreamt our basic dream
In the Old World while still a serf of kings,
Who dreamt a dream so strong, so brave, so true,
That even yet its mighty daring sings
In every brick and stone, in every furrow turned
That's made America the land it has become.
O, I'm the man who sailed those early seas
In search of what I meant to be my home--
For I'm the one who left dark Ireland's shore,
And Poland's plain, and England's grassy lea,
And torn from Black Africa's strand I came
To build a "homeland of the free."

The free?

Who said the free? Not me?
Surely not me? The millions on relief today?
The millions shot down when we strike?
The millions who have nothing for our pay?
For all the dreams we've dreamed
And all the songs we've sung
And all the hopes we've held
And all the flags we've hung,
The millions who have nothing for our pay--
Except the dream that's almost dead today.

O, let America be America again--
The land that never has been yet--
And yet must be--the land where every man is free.
The land that's mine--the poor man's, Indian's, Negro's, ME--
Who made America,
Whose sweat and blood, whose faith and pain,
Whose hand at the foundry, whose plow in the rain,
Must bring back our mighty dream again.

Sure, call me any ugly name you choose--
The steel of freedom does not stain.
From those who live like leeches on the people's lives,
We must take back our land again,
America!

O, yes,
I say it plain,
America never was America to me,
And yet I swear this oath--
America will be!

Out of the rack and ruin of our gangster death,
The rape and rot of graft, and stealth, and lies,
We, the people, must redeem
The land, the mines, the plants, the rivers.
The mountains and the endless plain--
All, all the stretch of these great green states--
And make America again!

-- Langston Hughes

http://cabdrollery.blogspot.com/2013/05/sunday-poetry-langston-hughes_6580.html

1,200 Harvard Students Demand Investigation Into Jason Richwine’s Thesis On Hispanic IQ

Over 1,000 Harvard students delivered a petition to Harvard University’s JFK School on Saturday, demanding an investigation into how and why the school approved a 2009 doctoral thesis arguing that Hispanics have lower IQs. The thesis was written by Jason Richwine, a co-author of a paper by the conservative Heritage Foundation that argued immigration reform would cost taxpayers $6.3 trillion. The discovery of Richwine’s paper by the Washington Post sparked a firestorm around the Heritage study, and several days later Richwine resigned from the think tank.

Now Harvard students want to know how a thesis built on those views and assumptions was able to make it through the approval process in the first place. “Academic freedom and a reasoned debate are essential to our academic community,’’ the petition read. “However, the Harvard Kennedy School cannot ethically stand behind academic work advocating a national policy of exclusion and advancing an agenda of discrimination.”

http://www.bostonglobe.com/metro/2013/05/17/kennedy-school-students-demand-inquiry-into-immigration-thesis/6Izovn4svIW6jvlm7VSDFO/story.html
http://thinkprogress.org/immigration/2013/05/19/2033831/1200-harvard-students-demand-investigation-into-jason-richwines-thesis-on-hispanic-iq/

Michelle Obama: “Do Not Waste A Minute Living Someone Else’s Dream”

“Failure is the key to success for so many great people… Oprah was demoted from her first job as a news anchor, and now she doesn’t even need a last name!

And then there’s this guy, Barack Obama, who lost — {crowd cheers} — I could take up a whole afternoon talking about his failures, but — he lost his first race for congress, and now? He gets to call himself my husband.”

http://thepoliticalcarnival.net/2013/05/19/video-first-lady-michelle-obama-delivers-commencement-address-at-mlk-jr-magnet-high-school-commencement/

http://www.balloon-juice.com/2013/05/19/sunday-evening-open-thread-do-not-waste-a-minute-living-someone-elses-dream/

Well Lookie Here: 3/28/2012: Judge rules tea party group a PAC, not a nonprofit

Judge rules tea party group a PAC, not a nonprofit
By Joe Holley | March 28, 2012
Comments 0 E-mail Print


A Travis County district court judge ruled this week that a Houston-based tea party group is not a nonprofit corporation as it claims, but an unregistered political action committee that illegally aided the Republican Party through its poll-watching efforts during the 2010 elections.

The summary judgment by Judge John Dietz upheld several Texas campaign finance laws that had been challenged on constitutional grounds by King Street Patriots, a tea party organization known for its "True the Vote" effort to uncover voter fraud.

The ruling grew out of a 2010 lawsuit filed by the Texas Democratic Party against the King Street Patriots. The Democrats charged that the organization made unlawful political contributions to the Texas Republican Party and various Republican candidates by training poll watchers in cooperation with the party and its candidates and by holding candidate forums only for GOP candidates.


more:
http://www.chron.com/news/houston-texas/article/Judge-rules-tea-party-group-a-PAC-not-a-nonprofit-3442532.php#src=fb
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