The Perils of Pandering

http://www.truthdig.com/report/item/20080127_the_perils_of_pandering/

Posted on Jan 27, 2008

By Andy Borowitz

After equating homosexuality with bestiality, former Arkansas Gov. Mike Huckabee was attacked at the San Francisco Zoo by a gay tiger.

Huckabee had scheduled a campaign stop at the zoo where he made his controversial remarks about homosexuality and bestiality, not realizing that he was standing within earshot of a Bengal tiger with a homosexual lifestyle.

According to onlooker Tracy Klujian, 27, “the way that tiger started growling during the speech, you could tell that it felt like it was being taunted.”

As Huckabee’s remarks about homosexuality and bestiality reached their peak, the irate tiger leaped over an 18-foot barrier and began mauling the presidential candidate.

Within minutes, police responding to a 911 call were on the scene, where they fired tranquilizer darts at both the tiger and Huckabee, who had continued to make his offensive remarks throughout the mauling.

According to one aide, the unfortunate tiger attack incident has done nothing to change Huckabee’s position on gay marriage: “Not only that, but now he’s opposed to tigers marrying other tigers.”

In other campaign news, former Massachusetts Gov. Mitt Romney used a speech in South Carolina to tout his life experience, including his stint as a generic white male clipart illustration.

Elsewhere, frustrated by persistent questions about steroid use, pitcher Roger Clemens threw a car at a reporter.

Award-winning humorist, television personality and film actor Andy Borowitz is author of “The Republican Playbook.”

© 2008 Creators Syndicate

How Teenage Rebellion Has Become a Mental Illness

By Bruce E. Levine, AlterNet
Posted on January 28, 2008
http://www.alternet.org/story/75081/

For a generation now, disruptive young Americans who rebel against authority figures have been increasingly diagnosed with mental illnesses and medicated with psychiatric (psychotropic) drugs.

Disruptive young people who are medicated with Ritalin, Adderall and other amphetamines routinely report that these drugs make them "care less" about their boredom, resentments and other negative emotions, thus making them more compliant and manageable. And so-called atypical antipsychotics such as Risperdal and Zyprexa -- powerful tranquilizing drugs -- are increasingly prescribed to disruptive young Americans, even though in most cases they are not displaying any psychotic symptoms.

Many talk show hosts think I'm kidding when I mention oppositional defiant disorder (ODD). After I assure them that ODD is in fact an official mental illness -- an increasingly popular diagnosis for children and teenagers -- they often guess that ODD is simply a new term for juvenile delinquency. But that is not the case.

Young people diagnosed with ODD, by definition, are doing nothing illegal (illegal behaviors are a symptom of another mental illness called conduct disorder). In 1980, the American Psychiatric Association (APA) created oppositional defiant disorder, defining it as "a pattern of negativistic, hostile and defiant behavior." The official symptoms of ODD include "often actively defies or refuses to comply with adult requests or rules" and "often argues with adults." While ODD-diagnosed young people are obnoxious with adults they don't respect, these kids can be a delight with adults they do respect; yet many of them are medicated with psychotropic drugs.

An even more common reaction to oppressive authorities than overt defiance is some type of passive defiance.

John Holt, the late school critic, described passive-aggressive strategies employed by prisoners in concentration camps and slaves on plantations, as well as some children in classrooms. Holt pointed out that subjects may attempt to appease their rulers while still satisfying some part of their own desire for dignity "by putting on a mask, by acting much more stupid and incompetent than they really are, by denying their rulers the full use of their intelligence and ability, by declaring their minds and spirits free of their enslaved bodies."

Holt observed that by "going stupid" in a classroom, children frustrate authorities through withdrawing the most intelligent and creative parts of their minds from the scene, thus achieving some sense of potency.

Going stupid -- or passive aggression -- is one of many nondisease explanations for attention deficit hyperactivity disorder (ADHD). Studies show that virtually all ADHD-diagnosed children will pay attention to activities that they enjoy or that they have chosen. In other words, when ADHD-labeled kids are having a good time and in control, the "disease" goes away.

There are other passive rebellions against authority that have been medicalized by mental health authorities. I have talked to many people who earlier in their lives had been diagnosed with substance abuse, depression and even schizophrenia but believe that their "symptoms" had in fact been a kind of resistance to the demands of an oppressive environment. Some of these people now call themselves psychiatric survivors.

While there are several reasons for behavioral disruptiveness and emotional difficulties, rebellion against an oppressive environment is one common reason that is routinely not even considered by many mental health professionals. Why? It is my experience that many mental health professionals are unaware of how extremely obedient they are to authorities. Acceptance into medical school and graduate school and achieving a Ph.D. or M.D. means jumping through many meaningless hoops, all of which require much behavioral, attentional and emotional compliance to authorities -- even disrespected ones. When compliant M.D.s and Ph.D.s begin seeing noncompliant patients, many of these doctors become anxious, sometimes even ashamed of their own excessive compliance, and this anxiety and shame can be fuel for diseasing normal human reactions.

Two ways of subduing defiance are to criminalize it and to pathologize it, and U.S. history is replete with examples of both. In the same era that John Adams' Sedition Act criminalized criticism of U.S. governmental policy, Dr. Benjamin Rush, the father of American psychiatry (his image adorns the APA seal), pathologized anti-authoritarianism. Rush diagnosed those rebelling against a centralized federal authority as having an "excess of the passion for liberty" that "constituted a form of insanity." He labeled this illness "anarchia."

Throughout American history, both direct and indirect resistance to authority has been diseased. In an 1851 article in the New Orleans Medical and Surgical Journal, Louisiana physician Samuel Cartwright reported his discovery of "drapetomania," the disease that caused slaves to flee captivity. Cartwright also reported his discovery of "dysaesthesia aethiopis," the disease that caused slaves to pay insufficient attention to the master's needs. Early versions of ODD and ADHD?

In Rush's lifetime, few Americans took anarchia seriously, nor was drapetomania or dysaesthesia aethiopis taken seriously in Cartwright's lifetime. But these were eras before the diseasing of defiance had a powerful financial ally in Big Pharma.

In every generation there will be authoritarians. There will also be the "bohemian bourgeois" who may enjoy anti-authoritarian books, music, and movies but don't act on them. And there will be genuine anti-authoritarians, who are so pained by exploitive hierarchies that they take action. Only occasionally in American history do these genuine anti-authoritarians actually take effective direct action that inspires others to successfully revolt, but every once in a while a Tom Paine comes along. So authoritarians take no chances, and the state-corporate partnership criminalizes anti-authoritarianism, pathologizes it, markets drugs to "cure" it and financially intimidates those who might buck the system.

It would certainly be a dream of Big Pharma and those who favor an authoritarian society if every would-be Tom Paine -- or Crazy Horse, Tecumseh, Emma Goldman or Malcolm X -- were diagnosed as a youngster with mental illness and quieted with a lifelong regimen of chill pills. The question is: Has this dream become reality?

Bruce E. Levine, Ph.D., is a clinical psychologist and author of Surviving America's Depression Epidemic: How to Find Morale, Energy, and Community in a World Gone Crazy (Chelsea Green, 2007).

© 2008 Independent Media Institute. All rights reserved.
View this story online at: http://www.alternet.org/story/75081/

Democracy? Who said anything about democracy?

By Stephanie Mencimer, Mother Jones Online
Posted on January 30, 2008
http://www.alternet.org/story/75267/

The line forms early on Friday mornings at Foundry United Methodist Church, a nearly 200-year-old institution located a few blocks from the White House. Famous in some circles as Bill Clinton's church, among the city's down and out, Foundry is better known as one of the few places around that offer help securing a government-issued photo identification.

Two weeks ago, Deborah Killebrew, 58, was one of those queued up outside the church to pick up a copy of her birth certificate, which Foundry volunteers had helped her obtain. Six years ago, Killebrew was hit by a drunk driver. Her fiance was killed in the crash, and she was left with cervical spine injuries that eventually put her in a wheelchair. After a string of bad luck, she wound up living in a D.C. homeless shelter. Somewhere along the way, she lost her expired Virginia driver's license. Killebrew was unable to get a new one because she didn't have an official copy of her birth certificate from the state of Indiana, where she was born. But to get her birth certificate, Killebrew had to send the state a copy of her driver's license or a stack of other documents -- like a car registration or mortgage document -- that she also didn't have. Eventually, she just gave up until she was referred to Foundry.

Without a photo ID, Killebrew may not be able to drive or apply for food stamps, but here in D.C., one thing she can do is vote, which she does regularly. If she still lived in Indiana, though, she'd be out of luck. Two days before she arrived at Foundry to claim her birth certificate, the U.S. Supreme Court heard oral arguments in a lawsuit over a strict new Indiana law requiring all voters to show a government-issued photo ID before casting a ballot. The plaintiffs argued that the law was an unconstitutional burden on voters, particularly minority, poor and elderly voters, who are the least likely to have the requisite ID. The law does allow people without an ID to cast a provisional ballot, but it won't get counted until the voter turns up at a county clerk's office to present identification.

If the justices rule against the plaintiffs, they will clear the way for other states to implement similar laws restricting voting rights for the less fortunate. Judging from the oral arguments in Crawford v. Marion County Elections Board, that's just what the justices are poised to do. While John Roberts worked at a steel mill during college, and Clarence Thomas came up dirt-poor in Pin Point, Ga., the Supreme Court of late hasn't shown much interest in people like Killebrew who reside at the bottom of the economic food chain. The court's docket is increasingly dominated by business litigation -- patent challenges, anti-trust suits and attempts by big businesses to insulate themselves from all sorts of legal liability and litigation brought by their employees, investors or aggrieved customers. The U.S. Chamber of Commerce recently bragged that it had its best year yet before the high court in 2007, racking up a string of impressive victories for big business that even surpassed the chamber's record-breaking year in 2006.

Topped off by last week's decision in Stoneridge Investment Partners v. Scientific Atlanta, which sharply restricted the ability of shareholders to sue entities that abet corporate fraud, recent winners before the Supreme Court have included Enron and the banks that facilitated its scam, payday lenders, investment banks that engage in price fixing and tobacco companies, among others. Losers have been small investors, poor black schoolchildren, working-class women paid less than men -- and one kid who was paralyzed after a police officer rammed his car because he was speeding.

Not only are "the people" losing at a rapid clip when they come before the court, but it has gotten much, much harder for the average person to even get into court in the first place. Over the past two decades, Supreme Court decisions have quietly prevented a wide swath of the American population from even reaching the courthouse, much less prevailing there when they've challenged better-funded and more powerful interests. Lee Epstein, a professor at Northwestern law school, says that the court is "shutting down access to plaintiffs in all sorts of ways. The court seems to be saying 'stay out.'"

In the last term, the court ruled, for instance, that taxpayers had no right to challenge the federal government's use of tax dollars to pay for religious-based social services. The case overturned years of precedent giving people a say in how their money is spent if it seems to mix too much church with state business. In a complicated anti-trust case, the court basically rewrote the rules for filing a civil lawsuit, making it harder for plaintiffs to even get into a courtroom under the guise of protecting business from allegedly frivolous lawsuits.

Many civil rights lawsuits are brought by private individuals rather than the government through agencies like the Equal Employment Opportunity Commission, making them the primary mode of enforcing anti-discrimination laws passed by Congress. Yet the Supreme Court has moved to sharply limit such lawsuits through decisions that, for instance, restrict the awarding of attorneys fees to plaintiffs so that lawyers can no longer afford to bring such cases.

Epstein says that while it's true many of these decisions break down along ideological lines, some of rulings also may stem from the justices' personal backgrounds. Never has the Supreme Court been more homogeneous, she says, noting that race and gender aside, the range of professional experience of the current court is extremely limited. All of the current justices came straight from the federal appeals courts, she points out, and most spent the bulk of their careers in government service or academia. Today's sitting justices are even geographically homogeneous, having lived most of their adult lives in Washington or other nearby East Coast metro centers. Before they were appointed, Epstein says, "Most of these people could have taken the Metro or Amtrak to get to work."

At least with Sandra Day O'Connor on the court, Epstein says, there was not just a female voice, but someone from the West who had a different background from the other justices. O'Connor had been an Arizona state legislator and served as an elected trial court judge in Maricopa County. Epstein suggests that some of the court's rulings in recent years may have as much to do with the justices' service on appellate courts as ideology. None of them has much experience as private-practice litigators or trial judges, where they would be forced to look the plaintiffs in the eye and hear their stories. Epstein believes that the current crop of justices is inclined to think that "the judges below them get it right."

The insular experience of the Supreme Court justices seems to be spilling over into their decision making in a way that goes beyond partisan politics. Indeed, some of the more arcane business cases, which will nonetheless have a profound impact on such things as consumer protection, were decided by majorities that included Clinton appointees. All of the justices seem reluctant to do anything that might mess with business too much, even when those businesses could use some messing with.

In Watters v. Wachovia last year, for instance, Ruth Bader Ginsburg, a former ACLU lawyer, wrote the opinion for a majority that also included liberal Steven Breyer in a case that declared that states have no right to regulate the operating subsidiaries of national banks. On its face, this might sound like no big deal, until you recognize that some of those operating subsidiaries were engaged in subprime and other shady mortgage lending that's now wreaking havoc on the economy. The states had attempted to step in to combat some of the fraud at work long before the feds even noticed there was a problem.

But the court's liberals deferred to the federal banking regulators in the Office of the Comptroller of the Currency. The decision was a huge victory for the banks, leaving their subsidiaries largely immune to regulation or lawsuits based on state consumer protection laws.

Ginsburg and Breyer also came down with the majority in a decision that upheld the use of mandatory-arbitration clauses in contracts for services that are themselves against the law. In Buckeye Check Cashing v. Cardegna, the court said a consumer could be forced to arbitrate a dispute with a payday lender rather than go to court even though payday lending is illegal in Florida, where the case originated.

During the oral arguments, Breyer expressed concern that if the court ruled for the consumer, businesses might suffer because so many of them now use mandatory arbitration to keep people out of court. He seemed to believe that letting people go to court would somehow lead to economic ruin, even when they were suing companies that had defrauded them. "I wouldn't want to reach a decision … that would make a significant negative difference in the gross national product of the United States," Breyer said. The case greatly expanded the number of people who can no longer bring their consumer disputes before a judge or jury.

Despite a few of these sorts of decisions, it is still the conservatives on the court who seem to be most out of touch with the people who will be affected by their rulings. The oral arguments during the Indiana voter ID case serve as a case in point. There was Chief Justice John Roberts Jr. with his movie-star good looks and a smile and smoothness that seemed so reasonable and reassuring during his confirmation hearings. And yet, during the oral arguments, Roberts couldn't have been more dismissive of the plight of poor and minority voters at the heart of the case. Like the other conservatives, Roberts, who earned $1 million a year in private practice, couldn't seem to fathom that there are people in this country who don't have a photo ID. When informed that a voter who didn't have an ID would have to travel to a county clerk's office to provide addition documentation for her vote to be counted, Roberts quipped that in his home state of Indiana, county clerk's offices weren't too far apart.

The plaintiffs' lawyer, Paul Smith, countered that for a poor person living in Gary, Ind., the county clerk's office was quite a schlep, 17 miles. ("Seventeen miles is 17 miles for the rich and the poor," Antonin Scalia chimed in.) Smith gently reminded the justices that the people he was talking about didn't have driver's licenses. That's why they couldn't vote at their local polling places. For them, getting to the clerk's office would require using public transportation, which, anyone who's ever spent much time on public transit would surely know, gets less and less frequent and reliable the farther you have to travel.

What was striking about the exchange between Smith and Roberts, though, wasn't just Roberts' unfamiliarity with riding the bus, but his lack of any apparent understanding of the lives of people on the lower end of the economic spectrum. In this regard, Roberts is not alone on the court. It's clear that many of the justices would rather not see these sorts of folks appearing on their docket at all. Simon Lazarus, public policy counsel at the National Senior Citizens Law Center, calls it the "arrogant abstractness" that predominates the court today.

The court's overt hostility to average- or low-income people is in itself keeping people out of court. One possible reason the Supreme Court docket is so crowded with business cases is that liberal public interest lawyers are avoiding it, says John Bouman, the president of the Sargent Shriver National Center on Poverty Law. "There's very little empathy on the court," he says, and as a result "people are showing restraint as to whether to take things up at all."

The change in the docket may only reinforce the court's ivory-tower qualities. The fewer everyday people who make their cases in court, the fewer opportunities the justices will have to let their perceptions evolve. One of the selling points of lifetime tenure for Supreme Court justices is that it can free them from politics and allow them to focus on the law and the facts of the cases before them. It is supposed to allow for evolution, which has been known to happen. Justice John Paul Stevens, now the last remaining reliable liberal on the court, is himself a Republican appointee nominated by Gerald Ford. His views on such hot-button issues as affirmative action and obscenity have changed during his many years on the court. Even former Chief Justice Rehnquist, who as a law clerk once wrote that he thought Plessy v. Ferguson, the case upholding racial segregation, ought to be reaffirmed, eventually came to champion Brown v. Board of Education.

But you do have to wonder about the current crop of young conservatives like Roberts. Insulated from the real world through an adult life of privilege, insulated from actual people by years of conservative legal rulings, it's hard to see where the opportunities for growth will come from. As Arthur Bryant, the executive director of Public Justice, a public-interest law firm, says, "Our system of justice cannot do justice if people cannot get into court."

Stephanie Mencimer is a reporter in Mother Jones' Washington, D.C., bureau and the author of Blocking the Courthouse Door: How the Republican Party and Its Corporate Allies Are Taking Away Your Right to Sue (Free Press, 2006).

© 2008 Independent Media Institute. All rights reserved.
View this story online at: http://www.alternet.org/story/75267/

From the "What Were They Thinking" department...

Reminds me of the old Southpark Faith Plus One ad, with Cartman singing, "I wanna get down on my knees and start pleasing Jesus". Are those kids looking at Jesus's, um...switch?

Suffer unto me the little children, so that they can turn me on.

Why Jose Padilla's 17-Year Sentence Should Disgust All Americans

By Andy Worthington, AlterNet
Posted on January 22, 2008
http://www.alternet.org/story/74590/

The news that US citizen Jose Padilla has received a prison sentence of 17 years and four months should provoke outrage in the United States, although it is unlikely that there will be much more than a whimper of dissent.

The former gang member and convert to Islam -- whose arrest in May 2002 was trumpeted by then-Attorney General John Ashcroft as that of a "known terrorist," who was "exploring a plan" to detonate a radioactive "dirty bomb" in a US city -- was once regarded as one of the most dangerous terrorists ever apprehended on American soil. Almost six years later, as he received his sentence, he was not actually accused of lifting a finger to harm even a single US citizen.

While this is shocking enough in and of itself, Padilla's sentence - in what at least one perceptive commentator called "the most important case of our lifetimes" - is particularly shocking because it sends a clear message to the President of the United States that he can, if he wishes (and as he did with Padilla), designate a US citizen as an "enemy combatant," hold him without charge or trial in a naval brig for 43 months, and torture him - through the use of prolonged sensory deprivation and solitary confinement - to such an extent that, as the psychiatrist Dr. Angela Hegarty explained after spending 22 hours with Padilla, "What happened at the brig was essentially the destruction of a human being's mind."

Padilla's warders had another take on his condition, describing him as "so docile and inactive that he could be mistaken for 'a piece of furniture,'" but the most detailed analysis of the effects of his torture was, again, provided by Angela Hegarty in an interview last August with Democracy Now:

Juan Gonzalez: And have you dealt with someone who had been in isolation for such a long period of time before?

Dr. Angela Hegarty: No. This was the first time I ever met anybody who had been isolated for such an extraordinarily long period of time. I mean, the sensory deprivation studies, for example, tell us that without sleep, especially, people will develop psychotic symptoms, hallucinations, panic attacks, depression, suicidality within days. And here we had a man who had been in this situation, utterly dependent on his interrogators, who didn't treat him all that nicely, for years. And apart from - the only people I ever met who had such a protracted experience were people who were in detention camps overseas, that would come close, but even then they weren't subjected to the sensory deprivation. So, yes, he was somewhat of a unique case in that regard.

As if this were not worrying enough, it was what happened after Padilla's 43-month ordeal that sealed the President's impunity to torture US citizens at will. When it seemed that his case was within reach of the US Supreme Court, the government transferred him into the US legal system, deposited him in a normal prison environment, dropped all mention of the "dirty bomb" plot, and charged him, based on his association with two alleged terrorist facilitators, Adham Amin Hassoun and Kifah Wael Jayyousi, with participating in a Florida-based plot to aid Islamic extremists in holy wars abroad. When the case came to court last summer, the judge, Marcia Cooke, airbrushed Padilla's torture from history, insisting that it could not be discussed at all, and, after a trial regarded as farcical by many observers, Padilla and his co-defendants were duly found guilty.

Today's sentencing, after an unusually protracted two-week debate, has apparently brought the whole sordid saga to an end, with Padilla's torture only mentioned briefly in passing by Judge Cooke, who noted, "I do find that the conditions [for Padilla as an enemy combatant] were so harsh that they warrant consideration." Nevertheless, he received a longer sentence than either of his co-defendants (who were sentenced to 15 years and eight months, and 12 years and eight months, respectively), even though two jurors admitted to the Miami Herald that the jury as a whole "struggled to convict Padilla because the panel initially viewed him as a bit player in the scheme to aid Islamic extremists, unlike his co-defendants."

They certainly had a point. While the conviction of Hassoun and Jayyousi was based on coded conversations in 126 phone calls intercepted by the FBI over a number of years, Padilla was included in only seven of those phone calls. Groomed by his mentor, Hassoun, he had traveled to the Middle East and, in 2000, had applied to attend a military training camp in Afghanistan, using the name Abu Abdallah al-Muhajir. His application form, which, according to a government expert, bore his fingerprints, was apparently discovered during a CIA raid on an alleged al-Qaeda safe house in Afghanistan, but although the prosecution presented an alleged al-Qaeda graduation list with his Muslim name on it during the sentencing, they had been unable to provide any evidence during the trial that he had actually attended the training camp in Afghanistan.

In the end, Padilla's conviction hinged on the jury's determination that he had "joined the terrorism conspiracy in the United States before leaving the country." This was based on a single recorded conversation, in July 1997, in which he stated that he was ready to join a jihad overseas.

17 years and four months seems to me to be an extraordinarily long sentence for little more than a thought crime, but when the issue of Padilla's three and half years of suppressed torture is raised, it's difficult not to conclude that justice has just been horribly twisted, that the President and his advisors have just got away with torturing an American citizen with impunity, and that no American citizen can be sure that what happened to Padilla will not happen to him or her. Today, it was a Muslim; tomorrow, unless the government's powers are taken away from them, it could be any number of categories of "enemy combatants" who have not yet been identified.

For more on Jose Padilla and other US "enemy combatants," see Andy Worthington's book The Guantánamo Files: The Stories of the 774 Detainees in America's Illegal Prison.

Andy Worthington is a writer and historian.

© 2008 Independent Media Institute. All rights reserved.
View this story online at: http://www.alternet.org/story/74590/

Want to Stimulate the Economy? Tax the Wealthy

By Chuck Collins, AlterNet
Posted on January 24, 2008
http://www.alternet.org/story/74736/

Every couple of years, when big investors suffer losses, Congress and their partisan economists launch into a heated debate over how to stimulate the flagging economy. This is mostly a rehash of the "trickle down" versus "bottom up" debate that dates back to the Reagan years.

Conservatives argue that the answer to the recession is to cut taxes and interest rates targeted at their über-wealthy and global corporate patrons. This is their program for any season, rain or shine, so it is immediately suspect.

Progressives argue, correctly, that we should target tax breaks and rebates to low- and middle-income people; their consumer spending will keep the economy chugging. Give a tax break to big corporations and the rich, and it will go anywhere on the planet in search of maximum returns. Give a tax rebate to a lower-income person or a small business and it is spent in the local economy, thus stimulating bottom up demand.

The likely congressional compromise will direct tens of billions in tax breaks to corporations and send ordinary people a check for $300 or $400. The wealthy will be further enriched, and everyone else will have extra cash to spend or pay down their Visa bill.

Whatever Congress does, however, it will borrow funds -- adding further to a national debt that now tops $9 trillion. More borrowing will continue to weaken our economy, widen our trade deficit, increase current and future wealth inequality, and postpone the bill payment for another day.

Meanwhile, the rest of the world's economists look at the United States like we're profligate fools jumping up and down on a bubble of debt. They're nervously depending on us to remain the "shoppers of the world" by borrowing money and buying imports beyond our means. But they see what we ignore: The gig is up.

Underlying our economic crisis is a polarization of income and wealth. Real wages for working people have been stagnant for decades, a horrific fact that has been masked only by increased work hours and vast amounts of private consumer debt in the form of credit cards and second mortgages. On the other end of the wealth spectrum, the superrich have so much money that they are engaging in speculative investments in search of maximum returns. This casino class, with its hedge funds and mortgage gambling schemes, have fueled further economic instability.

Congress should pass a "bottom up" stimulus package and pay for it with taxes on the rich. Three progressive tax proposals could pay for additional investments that would broaden prosperity and reduce distortions caused by concentrated wealth.

Increase top income tax rates. There are 7,500 households in the United States with annual incomes over $20 million. This private jet crowd has been the big winner of the rigged tax system of the last two and a half decades. Congress should boost the top tax rate to 50 percent on annual incomes over $5 million and to 70 percent on incomes over $10 million. This would generate an additional $105 billion a year and pay for a federal stimulus package.

Increase estate taxes. While the Bush administration is using the recession as a pretext for abolishing the estate tax by making the 2001 tax cut permanent, Congress should do just the opposite. The estate tax, our nation's only levy on inherited wealth, should be revamped to tax inheritances over $20 million at higher rates. Revenue should be dedicated to reducing the payroll tax or providing debt-free college educations. As part of reforming the estate tax, Congress should restore the credit that allows states to "piggy back" on the federal estate tax and generate billions in revenue for states. State spending on education, infrastructure and community development are among the most effective intermediate-term economic stimulus.

Tax warehouses of wealth. Over the last two decades, the über-rich have funneled billions of dollars -- funds that could have been taxed -- into private foundations and nonprofit organizations like Harvard University. This is the "people's money," forgone tax dollars that should help stimulate the economy. We should increase the annual excise tax on private foundations and nonprofit corporations with assets over $20 million by two percent. Foundations that fail to pay out more than 5 percent a year, excluding their overhead, should be assessed an even higher excise tax.

These measures would generate hundreds of billions to pay for immediate economic stimulus as well as meaningful investments in economic opportunity. Borrowing funds to stimulate the economy will just postpone the pain. Paying now, through targeted taxes on the wealthy, makes economic sense. Further, it addresses the root of our current economic distress, the extreme inequality of wealth and power.

Chuck Collins is a senior scholar at the Institute for Policy Studies and chair of the Working Group on Extreme Inequality, an emerging coalition of religious, business, labor and civic groups concerned about the wealth gap. He is co-author with Bill Gates Sr. of Wealth and Our Commonwealth: Why America Should Tax Accumulated Fortunes.

© 2008 Independent Media Institute. All rights reserved.
View this story online at: http://www.alternet.org/story/74736/

Civil Rights Movement Gets Real

St. Louis Mayor Booed Off MLK Platform

By DON FITZ and ZAKI BARUTI

As the mayor approached the MLK Day podium the boos were so loud that the moderator stepped up to ask the crowd to let him speak. Over 500 people began chanting "Slay Must Go!" as dozens waved signs saying "End Racial Division - Recall Francis Slay." No one could tell if there was actually sound coming out of the mayor's lips.

Most of the audience felt it disgraced the memory of Martin Luther King for the mayor to be in the room. A few days before the annual rally Rev. Douglass Parham, Chair of the Concerned Clergy for the Betterment of St. Louis, requested that the officers of the MLK Day Committee uninvite the mayor due to his series of abuses against the Black community.

For over 10 years the Coalition Against Police Crimes and Repression (CAPCR) has attempted to stem the tide of racial profiling, beatings and murder of black youth by St. Louis cops. St. Louisans are continuously reminded of the issue, especially following the airing of footage shot from a news helicopter of cops chasing an unarmed black driver, dragging him out of his car and repeatedly hitting and kicking him.

After enormous effort working with the Board of Aldermen, CAPCR prepared legislation for a Civilian Oversight Board that passed with the votes of all Black Aldermen and several white ones. But the mayor vetoed the bill in 2006, basically saying that nothing would be done about police violence against Black residents. This pushed CAPCR members to be on the frontlines of booing the mayor.

Like many politicians across the US, Francis Slay has made it clear that he wants to gut services for the poor, low income and ethnic minorities. In St. Louis this is most vivid in the attack on public education.

Francis Slay prepared a 2003 takeover of the School Board by assembling a slate of four candidates who spent over $400,000 for an election that usually runs less than $5000. The new Board majority immediately began closing schools, laying off support staff, privatizing the cafeteria and grounds keeping and convincing AFT Local 420 that it intended to bust the union. Changed bus routes forced many kids to walk in the dark.

As Slay's School Board worked to dismantle public education and replace it with charter schools, its meetings became near-riotous shouting matches. The Board squandered $5,000,000 paying the management team of Alvarez and Marsal to sink the schools 26 achievement points below accreditation levels.

A coalition of teachers, parents and students fought back by fielding candidates who won every School Board election between 2004 and 2007. Outraged that his plan to jettison public education was being slowed, Slay worked to have the school system decertified and the elected board replaced by a board appointed politicians in Summer 2007. Teachers, parents and students came together again to boo the mayor.

Reflecting another trend among urban business and political elites, Francis Slay became a champion of eminent domain. During the last five years, low income housing has been clear cut from entire tracts of St. Louis. It has been replaced by much more expensive single family homes and condos. Small businesses have similarly been taken away as their land passes to developers who will enjoy huge tax breaks. Many of the boos the mayor received on MLK Day were from members of the Citizens Coalition to Fight Eminent Domain Abuse.

The other side of the St. Louis housing crisis is the crowding of Black families into dilapidated houses with peeling lead paint and lead dust which poisons children. The Green Party of St. Louis organized efforts to find out where the Slay political machine is spending childhood lead poisoning prevention money.

Throughout 2006, City government dodged questions from the Greens. So the Green Party petitioned for a full audit of City finances. Distrustful of how Slay government handles money, thousands signed. In July 2007, the State Auditor certified that there were significant signatures and that an audit would begin in 2008.

The spark that pushed the Black community into demanding a recall of Slay was the October 2007 demotion of Fire Chief Sherman George. The Black community sees George as a man of great integrity and character who worked himself up to become head of the Fire Department. George would not make promotions because he felt they would be based on unfair tests and would not result in positions going to the best qualified fire fighters.

Slay and the St. Louis Post-Dispatch put a racial edge on the controversy. They accused George of balking because Black fire fighters were underrepresented in the promotion list. When George did not meet Slay's deadline for making promotions, he was demoted. City Hall passed over a Black firefighter who was most qualified to become fire chief and instead appointed Dennis Jenkerson, a white friend of the mayor, to the top job.

The City's Department of Personnel had to change its rules to allow the mayor's friend to be eligible for the position. The St. Louis Post-Dispatch would not cover the story, which was reported by the Black-oriented St. Louis American.

Rallies to support Sherman George simultaneously distributed petitions to recall Francis Slay as mayor. One of the first actions of the Movement to Recall the Mayor of St. Louis was a call for a boycott by asking organizations not to have conventions in the City as long as the deep racial divide continues. In December 2007 the National Society of Black Engineers said that St. Louis would risk losing its convention if the atmosphere did not improve.

Stories of the racial crisis in St. Louis soon appeared in the New York Times, Boston Globe and Associated Press. Fully a month after the story of the boycott broke and after it had been covered nationally, the St. Louis Post-Dispatch finally wrote about it.

If Francis Slay wants St. Louis to be his plantation, the St. Louis Post-Dispatch strives to be his overseer. Not only did it fail to cover issues related to Sherman George, the recall and the boycott, it refused to regularly cover Green Party efforts to audit the City.

Yet the local press covered petition drives in much smaller municipalities in the area and the Post-Dispatch had regularly covered the audit petition drive of 1986. Its failure to provide responsible reporting meant that Greens lost potential petitioners and signers, thereby increasing the difficulty of their efforts. Greens would have liked to boo the Post-Dispatch as loudly as they did Slay.

Despite sparse reporting in the white press, mayor Slay's support is slipping. During the week before MLK Day, as black leaders were asking that he be uninvited, a group of business and political bigwigs arranged to discuss the crisis with several Black critics. Slay was not invited to its meetings. Former City Comptroller Virvus Jones, a critic who was at the meeting, told the St. Louis American, "The mayor wasn't in this room because some of the people in the room wouldn't meet with the mayor."

Meanwhile, current Comptroller Darlene Green, one of the most respected Black elected officials in St. Louis, announced that she welcomes the audit prompted by the Green Party. Minutes after Francis Slay was booed off the podium, Green was cheered as she announced her support for the continuing struggle of Black fire fighters in the City of St. Louis. These words were not insignificant since the comptroller sits on several committees with the mayor and coordinates regularly with his office.

Even Hillary Clinton seems to be distancing herself from Slay. Even though he was an early and vocal supported of Clinton, Francis Slay is noticeable by his absence from her campaign rallies.

There is an unambiguous effort to drive low income people, especially Black people, out of major cities across the US. This will increase incredible hardship as oil dries up and transportation costs skyrocket.

St. Louis activists are well aware that local institutional racism reflects this ongoing nationwide effort to intensify the subjugation of people of color. They heard the moderator tell them to be quiet so the mayor could speak as she claimed that MLK Day was a time of peace instead of protest. She could not have been more wrong. Honoring the memory of Dr. Martin Luther King requires continuing the struggle against injustice.

Don Fitz was an organizer of the petition to audit St. Louis, produces Green Time TV and is Editor of Synthesis/Regeneration: A Magazine of Green Social Thought.

Zaki Baruti is an organizer of the petition drive to recall Slay, Co-chair of the Coalition Against Police Crimes & Repression and President General of the Universal African Peoples Organization.

Don Fitz and Zaki Baruti are Co-coordinators of the Green Party of St. Louis.

The Blockade of Gaza

Worse Than a Crime

By URI AVNERY

It looked like the fall of the Berlin wall. And not only did it look like it. For a moment, the Rafah crossing was the Brandenburg Gate.

It is impossible not to feel exhilaration when masses of oppressed and hungry people break down the wall that is shutting them in, their eyes radiant, embracing everybody they meet - to feel so even when it is your own government that erected the wall in the first place.

The Gaza Strip is the largest prison on earth. The breaking of the Rafah wall was an act of liberation. It proves that an inhuman policy is always a stupid policy: no power can stand up against a mass of people that has crossed the border of despair.

That is the lesson of Gaza, January, 2008.

* * *

ONE MIGHT repeat the famous saying of the French statesman Boulay de la Meurthe, slightly amended: It is worse than a war crime, it is a blunder!

Months ago, the two Ehuds - Barak and Olmert - imposed a blockade on the Gaza Strip, and boasted about it. Lately they have tightened the deadly noose even more, so that hardly anything at all could be brought into the Strip. Last week they made the blockade absolute - no food, no medicines. Things reached a climax when they stopped the fuel, too. Large areas of Gaza remained without electricity - incubators for premature babies, dialysis machines, pumps for water and sewage. Hundreds of thousands remained without heating in the severe cold, unable to cook, running out of food.

Again and again, Aljazeera broadcast the pictures into millions of homes in the Arab world. TV stations all over the world showed them, too. From Casablanca to Amman angry mass protest broke out and frightened the authoritarian Arab regimes. Hosny Mubarak called Ehud Barak in panic. That evening Barak was compelled to cancel, at least temporarily, the fuel-blockade he had imposed in the morning. Apart from that, the blockade remained total.

It is hard to imagine a more stupid act.

* * *

THE REASON given for the starving and freezing of one and a half million human beings, crowded into a territory of 365 square kilometers, is the continued shooting at the town of Sderot and the adjoining villages.

That is a well-chosen reason. It unites the primitive and poor parts of the Israeli public. It blunts the criticism of the UN and the governments throughout the world, who might otherwise have spoken out against a collective punishment that is, undoubtedly, a war crime under international law.

A clear picture is presented to the world: the Hamas terror regime in Gaza launches missiles at innocent Israeli civilians. No government in the world can tolerate the bombardment of its citizens from across the border. The Israeli military has not found a military answer to the Qassam missiles. Therefore there is no other way than to exert such strong pressure on the Gaza population as to make them rise up against Hamas and compel them to stop the missiles.

The day the Gaza electricity works stopped operating, our military correspondents were overjoyed: only two Qassams were launched from the Strip. So it works! Ehud Barak is a genius!

But the day after, 17 Qassams landed, and the joy evaporated. Politicians and generals were (literally) out of their minds: one politician proposed to "act crazier than them", another proposed to "shell Gaza's urban area indiscriminately for every Qassam launched", a famous professor (who is a little bit deranged) proposed the exercise of "ultimate evil".

The government scenario was a repeat of Lebanon War II (the report about which is due to be published in a few days). Then: Hizbullah captured two soldiers on the Israeli side of the border, now: Hamas fired on towns and villages on the Israeli side of the border. Then: the government decide in haste to start a war, now: the government decided in haste to impose a total blockade. Then: the government ordered the massive bombing of the civilian population in order to get them to pressure Hizbullah, now: the government decided to cause massive suffering of the civilian population in order to get them to pressure Hamas.

The results were the same in both cases: the Lebanese population did not rise up against Hizbullah, but on the contrary, people of all religious communities united behind the Shiite organization. Hassan Nasrallah became the hero of the entire Arab world. And now: the population unites behind Hamas and accuses Mahmoud Abbas of cooperation with the enemy. A mother who has no food for her children does not curse Ismail Haniyeh, she curses Olmert, Abbas and Mubarak.

* * *

SO WHAT to do? After all, it is impossible to tolerate the suffering of the inhabitants of Sderot, who are under constant fire.

What is being hidden from the embittered public is that the launching of the Qassams could be stopped tomorrow morning.

Several months ago Hamas proposed a cease-fire. It repeated the offer this week.

A cease-fire means, in the view of Hamas: the Palestinians will stop shooting Qassams and mortar shells, the Israelis will stop the incursions into Gaza, the "targeted" assassinations and the blockade.

Why doesn't our government jump at this proposal?

Simple: in order to make such a deal, we must speak with Hamas, directly or indirectly. And this is precisely what the government refuses to do.

Why? Simple again: Sderot is only a pretext - much like the two captured soldiers were a pretext for something else altogether. The real purpose of the whole exercise is to overthrow the Hamas regime in Gaza and to prevent a Hamas takeover in the West Bank.

In simple and blunt words: the government sacrifices the fate of the Sderot population on the altar of a hopeless principle. It is more important for the government to boycott Hamas - because it is now the spearhead of Palestinian resistance - than to put an end to the suffering of Sderot. All the media cooperate with this pretence.

* * *

IT HAS been said before that it is dangerous to write satire in our country - too often the satire becomes reality. Some readers may recall a satirical article I wrote months ago. In it I described the situation in Gaza as a scientific experiment designed to find out how far one can go, in starving a civilian population and turning their lives into hell, before they raise their hands in surrender.

This week, the satire has become official policy. Respected commentators declared explicitly that Ehud Barak and the army chiefs are working on the principle of "trial and error" and change their methods daily according to results. They stop the fuel to Gaza, observe how this works and backtrack when the international reaction is too negative. They stop the delivery of medicines, see how it works, etc. The scientific aim justifies the means.

The man in charge of the experiment is Defense Minister Ehud Barak, a man of many ideas and few scruples, a man whose whole turn of mind is basically inhuman. He is now, perhaps, the most dangerous person in Israel, more dangerous than Ehud Olmert and Binyamin Netanyahu, dangerous to the very existence of Israel in the long run.

The man in charge of execution is the Chief of Staff. This week we had the chance of hearing speeches by two of his predecessors, generals Moshe Ya'alon and Shaul Mofaz, in a forum with inflated intellectual pretensions. Both were discovered to have views that place them somewhere between the extreme Right and the ultra-Right. Both have a frighteningly primitive mind. There is no need to waste a word about the moral and intellectual qualities of their immediate successor, Dan Halutz. If these are the voices of the three last Chiefs of Staff, what about the incumbent, who cannot speak out as openly as they? Has this apple fallen further from the tree?

Until three days ago, the generals could entertain the opinion that the experiment was succeeding. The misery in the Gaza Strip had reached its climax. Hundreds of thousands were threatened by actual hunger. The chief of UNRWA warned of an impending human catastrophe. Only the rich could still drive a car, heat their homes and eat their fill. The world stood by and wagged its collective tongue. The leaders of the Arab states voiced empty phrases of sympathy without raising a finger.

Barak, who has mathematical abilities, could calculate when the population would finally collapse.

* * *

AND THEN something happened that none of them foresaw, in spite of the fact that it was the most foreseeable event on earth.

When one puts a million and a half people in a pressure cooker and keeps turning up the heat, it will explode. That is what happened at the Gaza-Egypt border.

At first there was a small explosion. A crowd stormed the gate, Egyptian policemen opened live fire, dozens were wounded. That was a warning.

The next day came the big attack. Palestinian fighters blew up the wall in many places. Hundreds of thousands broke out into Egyptian territory and took a deep breath. The blockade was broken.

Even before that, Mubarak was in an impossible situation. Hundreds of millions of Arabs, a billion Muslims, saw how the Israeli army had closed the Gaza strip off on three sides: the North, the East and the sea. The fourth side of the blockade was provided by the Egyptian army.

The Egyptian president, who claims the leadership of the entire Arab world, was seen as a collaborator with an inhuman operation conducted by a cruel enemy in order to gain the favor (and the money) of the Americans. His internal enemies, the Muslim Brothers, exploited the situation to debase him in the eyes of his own people.

It is doubtful if Mubarak could have persisted in this position. But the Palestinian masses relieved him of the need to make a decision. They decided for him. They broke out like a tsunami wave. Now he has to decide whether to succumb to the Israeli demand to re-impose the blockade on his Arab brothers.

And what about Barak's experiment? What's the next step? The options are few:

(a) To re-occupy Gaza. The army does not like the idea. It understands that this would expose thousands of soldiers to a cruel guerilla war, which would be unlike any intifada before.

(b) To tighten the blockade again and exert extreme pressure on Mubarak, including the use of Israeli influence on the US Congess to deprive him of the billions he gets every year for his services.

(c) To turn the curse into a blessing, by handing the Strip over to Mubarak, pretending that this was Barak's hidden aim all along. Egypt would have to safeguard Israel's security, prevent the launching of Qassams and expose its own soldiers to a Palestinian guerilla war - when it thought it was rid of the burden of this poor and barren area, and after the infrastructure there has been destroyed by the Israeli occupation. Probably Mubarak will say: Very kind of you, but no thanks.

The brutal blockade was a war crime. And worse: it was a stupid blunder.

Uri Avnery is an Israeli writer and peace activist with Gush Shalom. He is a contributor to The Politics of Anti-Semitism.

Dear Senator Edwards,

It was good meeting with you yesterday and discussing my father's legacy. On the day when the nation will honor my father, I wanted to follow up with a personal note.

There has been, and will continue to be, a lot of back and forth in the political arena over my father's legacy. . .

I appreciate that on the major issues of health care, the environment, and the economy, you have framed the issues for what they are - a struggle for justice. And, you have almost single-handedly made poverty an issue in this election. . .

I am disturbed by how little attention the topic of economic justice has received during this campaign. I want to challenge all candidates to follow your lead, and speak up loudly and forcefully on the issue of economic justice in America. . .

I believe that now, more than ever, we need a leader who wakes up every morning with the knowledge of that injustice in the forefront of their minds, and who knows that when we commit ourselves to a cause as a nation, we can make major strides in our own lifetimes. My father was not driven by an illusory vision of a perfect society. He was driven by the certain knowledge that when people of good faith and strong principles commit to making things better, we can change hearts, we can change minds, and we can change lives.

So, I urge you: keep going. Ignore the pundits, who think this is a horserace, not a fight for justice. My dad was a fighter. As a friend and a believer in my father's words that injustice anywhere is a threat to justice everywhere, I say to you: keep going. Keep fighting. My father would be proud.

Sincerely,

Martin L. King, III

U.S. Markets Volatile After Europe Sell-Off

From NYT

By DAVID JOLLY and HEATHER TIMMONS

Wall Street got off to another volatile start on Wednesday, plunging deeply as the market opened before recovering much of the lost ground in morning trading.

Investors remained unsettled about the possibility of a recession, with the three main stock indexes lingering in the red a day after the Federal Reserve surprised investors — and stemmed a sell-off — with an aggressive unscheduled interest rate cut.

After diving nearly 250 points in the opening minutes, the Dow Jones industrial average came back to nearly even in the first hour, then fell back again. At 10:45 a.m., it was at 11,845.35, off 125.84, or 1 percent. The Standard & Poor’s 500-stock index showed a comparable decline.

Technology stocks took a harder hit after Motorola and Apple announced disappointing earnings forecasts, sending the tech-heavy Nasdaq composite index down 1.6 percent. Motorola’s shares were off 15 percent, and Apple’s were down 12 percent.

The declines on Wall Street came after another steep sell-off in European stock markets, which were disappointed after the head of the European Central Bank dampened investors’ hopes that the bank would follow the Fed’s lead in cutting interest rates.

Global stocks remained highly volatile a day after the Fed’s emergency interest rate cut on Tuesday. Asian shares gained sharply after a two-day mauling, and many European markets opened with modest gains, in part on hopes for a rate cut in Europe. But the chief European central banker, Jean-Claude Trichet, indicated in Brussels that no monetary easing was in the cards.

“In demanding times of significant market correction and turbulences, it is the responsibility of the central bank to solidly anchor inflation expectations to avoid additional volatility in already highly volatile markets,” Mr. Trichet told the European parliament, according to Reuters.

Mr. Trichet’s remarks, combined with signals from the Bank of England, the Bank of Japan and others that they intended to hold rates steady, sent major European indexes sharply lower, and overnight trading in American index futures signaled that Wall Street would open lower as well.

In mid-afternoon trading, the CAC 40 in Paris and the DAX 30 in Frankfurt were down 3.5 percent and the FTSE 100 in London was off 1.2 percent.

Eric Chaney, chief economist for Europe at Morgan Stanley in London, said the market was “impatient” for a European rate cut, but that Mr. Trichet’s comments were not quite as hawkish as some seemed to think.

“The E.C.B. had a tightening bias previously,” Mr. Chaney said, but “Trichet left open the possibility of a move toward a neutral bias.”

Even so, he said, European investors were unlikely to get any short-term relief from the bank, as “news from the real economy in Europe is very good,” and “we would have to see some bad news from the real economy rather than the markets,” before policy makers cut rates there.

Some traders questioned whether the Fed itself had overreacted.

“The Fed rate cut was both bigger and earlier than people expected,” said Manuel Martin, an equity strategist at WGZ Bank in Frankfurt. “Now people are starting to ask, ‘Is the U.S. economy really that bad off?’ ”

The strong rises on Asian indexes Wednesday reflected buying by speculators to cover short positions, and a sense that shares in the region had fallen more than was justified. Hong Kong’s Hang Seng index, which experienced the biggest drops in Asia this month, led the region’s rebound, soaring 11 percent on Wednesday after the central bank there matched the Fed’s rate cut — an expected move, since the Hong Kong dollar is pegged to the United States dollar.

In China, the CSI 300 index rose 4.7 percent; in Japan, the Nikkei 225 gained 2 percent; in India, the Sensex, another of the biggest losers in the past two days, closed 5.6 percent higher on Wednesday. The Australian stock markets halted a 12-day losing streak.

But the gains on Asian markets were not big enough to erase the losses suffered there in recent days, as worries about the possibility of a crippling recession in the United States swept the globe.

“The system which supported the U.S. credit markets has collapsed,” said Yuuki Sakurai, director and general manager of the financial and investment planning department at Fukoku Mutual Life Insurance in Tokyo. “Merely easing rates will not solve the root problem,” which was that the problems in the mortgage market had upset “standard measures of investment.”

Larry Jones, chief investment officer at Nedgroup Investments, said, “The basic U.S. economic problems are not over, and a lot of them are ahead of us.”

The recent nosedive in Asian markets shows that even if the fast-growing economies of Asia are able to avoid a slowdown from the problems in the United States, the region’s high-flying stock markets will not, he said.

Central banks in Asia faced the question of whether to follow America’s lead on interest rates or Europe’s.

“You have to stay in tune with the developments with the rest of the world,” the Asian Development Bank managing director, General Rajat Nag, told Reuters on Wednesday. “However, I think central banks in the region have to keep an eye on the inflation front as well,” he added.

Australia’s treasurer, Wayne Swan, said he welcomed the Fed’s move, while predicting that the domestic economy would remain strong despite any U.S. slowdown.

“It’s pretty fair to say that Australians can be confident that the prospects for growth in Asia and developing regions will help us withstand the fallout from the events in the United States and elsewhere,” he said.

Fred Zhang, a stock broker at Mansion House Securities in Hong Kong, said that Hong Kong investors were particularly encouraged by the Federal Reserve’s interest rate cut because of the correlation between currencies. Mr. Zhang said that while many investors were still worried, he was optimistic about the short-term prospects for the Hong Kong market.

“I think it will keep going upward,” he said.

After days of losses, “Asian markets were looking for a reason to move back” to prices that represent the fundamental numbers underlying them, said Subir Gokarn, Standard & Poor’s chief economist in Asia. Now investors need to overlook “the panic and the froth, and see what the reality is,” he said.

Heather Timmons reported from New Delhi and David Jolly from Paris. Contributing reporting were Tim Johnston in Sydney, Keith Bradsher in Hong Kong, Martin Foster in Tokyo, David Barboza in Shanghai and Michael M. Grynbaum in New York.

Neither Supply-Side Theory Nor Keynesian Remedies Can Save Us Now

Farewell to Old Economic Nostrums

By PAUL CRAIG ROBERTS

With his tax rebate policy, President Bush has put economic policy back on a Keynesian basis. Will it work?

During the two decades it was in effect, supply-side economics had restorative effects on the American economy. Its predecessor, Keynesian demand management, stimulated demand more than supply. Consequently, over time the trade-offs between employment and inflation worsened, and for a while it appeared that inflation and unemployment would rise together. The breakdown of the Keynesian policy opened the door for the Reagan administration's supply-side approach.

By following Nobel economist Robert Mundell's advice to "reverse the policy mix," the supply-side policy allowed the US economy to grow without paying for the growth with rising rates of inflation. However, the new macroeconomic policy was not a cure-all, and its success in banishing worsening "Philips curve" trade-offs between inflation and employment masked the appearance of new problems, such as the loss of jobs and GDP growth to offshoring, problems from deregulation, and the growing concentration of income in fewer hands.

The Bush administration is turning to tax rebates, because problems in the financial system and the amount of consumer debt hinder the Federal Reserve's ability to pump money to consumers through the banking system. Like an easy credit, low interest rate policy, the purpose of a tax rebate is to put money in consumers' hands in order to boost consumer demand.

Will consumers spend the rebate, or will they use it to pay down their debts? If they spend the rebate on consumer goods, will it provide much boost to the economy?

Many Americans are overloaded with debt and will have to use the rebate to pay down credit card debt. The gift of $800 per means-tested taxpayer is really just a partial bailout of heavily indebted consumers and credit card companies.

The percentage of the rebate that survives debt reduction will be further drained of effect by Americans' dependency on imports. According to reports, 70% of the goods on Wal-Mart shelves are made in China. During 2006, Americans spent $1,861,380,000,000 on imported goods, that is, 23% of total personal consumption expenditures were spent on imports (including offshored goods). This means that between one-fifth and one-fourth of new consumption expenditures will stimulate foreign economies.

Americans worry about their dependency on imported energy, but the $145,368,000,000 paid to OPEC in 2006 is a small part of the total import bill. Americans imported $602,539,000,000 in industrial supplies and materials; $418,271,000,000 in capital goods; $256,660,000,000 in automotive vehicles, parts and engines; $423,973,000,000 in manufactured consumer goods; and $74,937,000,000 in foods, feeds and beverages.

The Keynesian policy of driving the economy through consumer demand was applied to a different economy than the one we have today. In those days the goods Americans purchased, such as cars and appliances, were mainly made in America. Construction workers were not illegals sending their wages back to Mexico. The US had a robust manufacturing workforce. When consumer demand weakened, companies would reduce their output and lay off workers. Government policymakers would respond to the decline in employment and output with monetary and fiscal policies that boosted consumer demand. As consumer spending picked up, companies would call back the laid off workers in order to increase output to meet the rising demand.

Today Americans are losing jobs for reasons that have nothing to do with recession. They are losing their jobs to offshoring and to foreigners brought in on work visas. Today many American brands are produced offshore in whole or part with foreign labor and imported to the US for sale in the American market. In 2007, prior to the onset of the 2008 recession, 217,000 manufacturing jobs were lost. The US now has fewer manufacturing jobs than it had in 1950 when the population was half the current size.

US job growth in the 21st century has been confined to low-pay domestic services. During 2007, waitresses and bartenders, health care and social assistance, and wholesale and retail trade, transportation and utilities accounted for 91% of new private sector jobs.

When a population drowning in debt is hit with unemployment from recession on top of unemployment from offshoring, will the people spend their rebates in eating places and bars, thus boosting employment among waitresses and bartenders? Will they spend their rebates in shopping malls, thus boosting employment for retail clerks? If they become ill, the lack of medical insurance will direct their rebates to doctors' bills.

Economists and other shills for globalism told Americans not to worry about the loss of manufacturing jobs. Good riddance, they said, to these "old economy" jobs. The "new economy" would bring better and higher paying jobs in technical and professional services that would free Americans from the drudgery of factory work. So far, these jobs haven't shown up, and if they do, most will be susceptible to offshoring, just like the manufacturing jobs.

The Bush administration has in mind a total rebate of $150,000,000,000. As the government's budget is already in deficit, the money will have to be borrowed. As the US saving rate is about zero, the money will have to be borrowed abroad.

Foreigners are already concerned about the US government's indebtedness, and foreigners are bailing out some of our most important banks and Wall Street firms that foolishly invested in subprime derivatives.

Under pressure from budget and trade deficits, the US dollar has been losing value against other traded currencies. Having to borrow another $150 billion abroad will further erode the dollar's value.

Meanwhile, Congress passed a $700 billion "defense" bill so that the Bush administration can continue its wars in the Middle East.

Our leaders in Washington are out to lunch. They have no idea of the real challenges our country faces and America's dependence on foreign creditors.

The rebate will help Americans reduce their credit card debt. However, adding $150 billion to an existing federal budget deficit that will be worsened by recession could further alarm America's foreign creditors, traders in currency markets, and OPEC oil producers. If the rebate loses its punch to consumer debt reduction, imports, and pressure on the dollar, what will the government do next?

As long as offshoring continues, the US cannot close its trade deficit. Offshoring increases imports and reduces the supply of potential exports. With Washington's Middle East wars, with private companies ceasing to provide health coverage and pensions, with political spending promises in an election year, and with recession, the outlook for the federal budget deficit is dismal as well.

The US is moving into a situation in which the government could find it impossible to close the twin deficits without massive tariffs to curtail imports and offshoring and without pursuing peace instead of war. The outlook for the United States will continue to worsen as long as hegemonic superpower and free trade delusions prevail in Washington.

Paul Craig Roberts was Assistant Secretary of the Treasury in the Reagan administration. He was Associate Editor of the Wall Street Journal editorial page and Contributing Editor of National Review. He is coauthor of The Tyranny of Good Intentions.He can be reached at: PaulCraigRoberts@yahoo.com

Desperation tactics from Fed Reserve?

Fed Cuts Interest Rates by 75 Bps
Tuesday January 22
By Martin Crutsinger, AP Economics Writer Fed Cuts Interest Rate Amid Global Stock Sell-Off and Fears of Recession

WASHINGTON (AP) -- The Federal Reserve unexpectedly slashed a key interest rate by a bold three-fourths of a percentage point on Tuesday, responding to a global plunge in stock markets that heightened concerns about a recession. The Fed signaled that further rate cuts were likely.

The reduction in the federal funds rate from 4.25 percent down to 3.5 percent marked the biggest reduction in this target rate for overnight loans on records going back to 1990. It marked the first time that the Fed has changed the funds rate between meetings since 2001, when the central bank was battling the combined impacts of a recession and the terrorist attacks.

Federal Reserve Chairman Ben Bernanke and his colleagues approved the large rate cut after an emergency video conference on Monday night, a day when global markets had been pounded by rising concerns that weakness in the world's largest economy was spreading worldwide.

Despite the Fed's bold move, Wall Street plunged at the opening with the Dow Jones industrial average down 465 points before stocks began to rebound. The Dow finished the day off 128.11 points at 11,971.19. Analysts said the milder decline at the end of the day after such a rough start showed the Fed's effort to reassure Wall Street had an impact.

In a brief statement explaining its move, the Fed said that "appreciable downside risks to growth remain" and officials pledged to "act in a timely manner" to deal with the risks facing the economy. The action was approved on an 8-1 vote.

Analysts said the fact that the Fed did not wait until its meeting next week to cut rates underscored the seriousness of the situation.

"The world's stock markets are in meltdown so the Fed came in with an inter-meeting move to try to stop the panic," said Christopher Rupkey, senior economist at Bank of Tokyo-Mitsubishi.

The Bush administration, which had announced on Friday that President Bush supported a $150 billion economic stimulus package, said Tuesday that it was not ruling out doing more than the $150 billion proposal if necessary. Bush and Treasury Secretary Henry Paulson were conferring with congressional leaders at the White House on Tuesday, with all sides saying they want to reach agreement quickly.

The Fed was expected to cut rates further, possibly as soon as their next meeting on Jan. 29-30, if there are continued signs that the economy is weakening.

"This move by the Fed was essential," said Lyle Gramley, a former Fed governor who is now a senior analyst with the Stanford Financial Group in Washington. "Bernanke promised in a speech earlier this month to take substantive action in a timely and decisive manner."

Gramley said that Bernanke was now exercising the kind of forceful leadership the markets had been hoping to see since the credit crisis hit in August.

David Jones, chief economist at DMJ Advisors, said Fed officials have a range of options available at next week's meeting from a quarter-point move to a half-point move to holding rates steady but indicating the Fed is prepared to move again between meetings should conditions deteriorate further. Jones predicted the Fed would lower the funds rate to 3 percent by the end of March.

In addition to cutting the funds rate, the Fed said it was reducing its discount rate, the interest it charges to make direct loans to banks, by a similar three-quarters of a percentage point, pushing this rate down to 4 percent.

Commercial banks responded to the Fed's action on the funds rate by announcing similar cuts of three-quarter of a percent on its prime lending rate, the benchmark for millions of business and consumer loans. The action will mean the prime lending rate will drop from 7.25 percent down to 6.50 percent.

Global financial markets had plunged Monday as investors grew more concerned about the possibility that the United States, the world's largest economy, could be headed into a recession. Many markets suffered their biggest declines since the September 2001 terrorist attacks.

In its statement, the Fed said it had decided to cut the federal funds rate "in view of a weakening of the economic outlook and increasing downside risks to growth."

The central bank said that the strains in short-term credit markets have eased a bit, but "broader financial market conditions have continued to deteriorate and credit has tightened further for some businesses and households. Moreover, incoming information indicates a deepening of the housing contraction as well as some softening in labor markets."

Before Tuesday's move, the Fed had cut interest rates three times, beginning in September, the month after a severe credit crunch had roiled Wall Street and global financial markets. The Fed cut the funds rate by a half-point in September and then by smaller quarter-point moves in October and December.

"The committee will continue to assess the effects of financial and other developments on economic prospects and will act in a timely manner as needed to address those risk," the Fed statement said.

The Fed's action was approved on an 8-1 vote with William Poole, president of the Fed's regional bank, dissenting. The statement said that Poole objected because he did not believe current conditions justified a rate move before the Fed's meeting next week.

U.S. Economy Tanks!

While many have used the term "troubling" to describe the state of the economy, I would posit that this is an opportunity to re-examine ourselves and our priorities, and to revoke many corporate charters (we can you know!).--Pete

NBC Uninvites Kucinich

Rules changes kept progressive out of GE's debate

1/17/08



In a bizarre move the network has yet to explain, NBC rescinded an invitation to Democratic presidential candidate Dennis Kucinich to appear in its January 15 debate in Las Vegas. The GE-owned media company went all the way to the Nevada Supreme Court to defend its decision--all the while failing to explain its logic to the public.

The network originally declared a straightforward test for candidates wishing to participate in the debate: A candidate had to finish in at least fourth place in either the New Hampshire primary or Iowa caucuses, or finish among the top four in one of six major national polls. Kucinich met the latter standard, and was sent a letter on January 9 acknowledging that he would be participating in the debate, designed to air candidates' views before the January 19 Nevada caucuses.

But two days later, NBC political director Chuck Todd notified the Kucinich campaign that there were new rules: Candidates would have to have finished at least third in either Iowa or New Hampshire. The new standard eliminated Kucinich.

Of course, organizers of presidential debates have a right to establish neutral criteria for participation--criteria that should ideally be as inclusive as possible. But NBC has done little to explain why its original criteria suddenly needed to be fixed.

Indeed, Nevada district court Judge Charles Thompson ruled that Kucinich could not be legally barred from the debate, saying that he was a legitimate candidate who was "uninvited under circumstances that appear to be that they just decided to exclude him” (The Nation.com, 1/15/08).

But NBC successfully appealed its case to the state Supreme Court, saying that the revised standards were "in no way designed to exclude any particular candidate based on his or her views," and were a "good faith editorial choice of a privately owned cable network to limit debate participants based on the status of their campaigns." (Given that the legal argument involved FCC equal time rules, the network aired the debate only on its MSNBC cable channel, and not on its NBC affiliates in Nevada--thus limiting the actual audience for the debate).

While their argument worked in court, the fact that NBC journalists offered little in the way of a public explanation for their decision is troubling. Why were the original standards for the debate suddenly not good enough? NBC declared that it was merely exercising "journalistic discretion," but why did that discretion change so quickly?

The obvious answer is that when the previous criteria were set, there were four candidates polling better than Kucinich in the Democratic race. When one of them, New Mexico Gov. Bill Richardson, dropped out of the race, NBC suddenly switched to a standard that only allowed the top three candidates to debate.

Does Kucinich's campaign represent ideas that offend either NBC managers or their bosses at General Electric? It's a fair question, given that MSNBC canceled Phil Donahue's nightly show in early 2003 due to the host's opposition to the Iraq War; the company worried that the host would be a "difficult public face for NBC in a time of war" (FAIR Press Release, 4/3/03).

Kucinich's peace platform might be something that a major defense contractor like General Electric would rather not expose to voters on its cable network. Likewise, Kucinich's strong opposition to nuclear power likely doesn't sit well with GE, a major player in the industry; the issue was sure to come up in any debate in Nevada, where the proposed Yucca Mountain nuclear waste dump is intensely controversial.

Indeed, one of the rare challenges from the NBC moderators at the Las Vegas debate came in response to John Edwards' critical comments about nuclear power. Meet the Press host Tim Russert responded:

Senator Edwards, you say you're against nuclear power. But a reality check: I talked to the folks at the MIT Energy Initiative, and they put it this way, that in 2050, the world's population is going to go from 6 billion to 9 billion, that CO2 is going to double, that you could build a nuclear power plant one per week and it wouldn't meet the world's needs. Something must be done, and it cannot be done just with wind or solar.

It's also worth noting that NBC--like most other corporate media outlets--has had little time for Kucinich's campaign from the start, deciding long ago that the candidate was simply not viable (FAIR Media Advisory, 5/8/07). Kucinich's name has been mentioned only a few times in passing on NBC Nightly News, and Kucinich--unlike six other Democratic candidates--has yet to appear as part of Meet the Press's "Meet the Candidates" series.

In a rare case of self-examination from network journalists, Meet the Press host Tim Russert spoke to NBC Nightly News anchor Brian Williams about the media's role in marginalizing certain candidates (1/3/08):

The second-tier candidates, they get angry.
They think that the press doesn't focus on them, spends too much time talking about the front-runners in the debates, in the coverage day by day. But we say to them: "Well, make your mark. Start showing some growth. Start showing some resonance with the populace and you'll get the same kind of coverage." They'll say, "Wait a minute. How do we get resonance if we're not covered?" It's an important issue that we have to keep examining, our own behavior.

Perhaps Russert could examine that behavior now, and explain to NBC viewers and voters why the network has exerted so much effort to marginalize Kucinich's candidacy.

ACTION:

Please ask NBC to explain why it changed its original debate criteria to exclude Rep. Dennis Kucinich from their January 15 debate. Also, encourage Meet the Press host Tim Russert to be fair to Kucinich and invite him to participate in the "Meet the Candidates" series.

CONTACT:

NBC/MSNBC

Phone: 212 664-4444
Ask for the Comment Line

Email: letters@msnbc.com

NBC host Tim Russert via Meet the Press web contact form:
http://www.msnbc.msn.com/id/6872152/

Congressman William Delahunt to Investigate U.S. Corporations' Support for Colombian Paramilitaries

By Dan Feder,
Posted on Sat Jan 19th, 2008

The U.S. commercial media have been fixated on the telenovela of hostage negotiations with the Revolutionary Armed Forces of Colombia (FARC), and the recent visit to Colombia of three U.S. congressmen has been reported only in terms of how it relates to that issue. Unreported in any U.S.-language media was the meeting between Rep. Delahunt (Democrat of Massachusetts) and a number of jailed former leaders of the recently-demobilized narco-paramilitary army, the United Self-Defense Forces of Colombia. Bellow, we publish a translation of the story from the January 16 edition of the Colombian paper El Tiempo.

Delahunt says he has received new information on the extent to which U.S. corporations supported the AUC, which existed with relative impunity throughout Colombia, inflicting a government-protected, drug-funded reign of terror from roughly 1997 to 2004. (Whether that period has truly ended if of course debatable). Last year, the coal company Drummond was found not liable for the paramilitary murders of three mine union officials after extraordinary maneuvers by the judge and the Uribe administration to prevent key witnesses from testifying. And while Chiquita Brands was fined a sum amounting to less than one percent of its annual income for making payments to the AUC (the company’s leaders portraying themselves in the press as victims of extortion), no one in the justice department or the press seemed concerned that thousands of weapons for the AUC had entered Colombia through Chiquita’s private ports.

Time will tell if the Congressional investigation is able to ask the hard questions that the Justice Department wouldn’t...

Magnitude of Support from U.S. Frms in Past Years to Paramilitaries Concerns Congressman from that Country

So said democratic representative William Delahunt, after meeting with several former paramilitary bosses held in the Itagüí maximum security prison.

Delahunt, who spent four days in Colombia with his collegues James McGovern and George Miller, met with Salvatore Mancuso, Rodrigo Tovar (“Jorge 40”), Édgar Velosa (“HH”), Diego Fernando Murillo (“don Berna”) and Carlos Mario Jiménez (“Macaco”).

Although he added that he could not reveal the content of the interviews or the companies mentioned by the demobilized paramilitaries, Delahunt warned that “they were very specific and clear on the relationships between themselves and the American companies.”

Representative Delahunt heads the House International Relations Committee, which is investigating payments made to the AUC after the banana company Chiquita Brands was fined $25 million after it recognized having paid $1.7 million to paramilitary groups between 1997 and 2004.

“We are concerned by the magnitude of the participation of American companies in the payments they made to the AUC,” said Delahunt.

The congressman announced that now he will review the interviews with the former para bosses together with the researchers who accompany him, in order to move into the next phase of the investigation: corroborating what they said.

“I will return to Colombia in three or four months to interview other people who have important information on the issue. I will also meet with the executives of those companies in the United States that seem to be implicated,” he added.

Delahunt said that “it is worth seriously considering” that the money from fines placed on these companies could help to provide reparations to the victims of paramilitary violence.

He stated that the new results of these investigations would be not be released for a year or more. “This investigation is going to require considerable time and resources,” he emphasized.