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December 3, 2008 at 05:10:33
Promoted to Headline (H2) on 12/3/08: by Stephen Lendman Page 1 of 5 page(s) |
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Dream on if you believe it, and something must be up if Karl Rove says it. In a November 28 Wall Street Journal op-ed, he called it "a first-rate economic team" while at the same time objecting to possible (not yet announced) stimulus package elements not entirely to be the kinds "conservatives" prefer like tax cuts for the rich. He nonetheless called Obama's team "reassuring" and hopes it will leave a "market-oriented imprint."
Not to worry, as that's what it's there for - the privileged elite and not the other 90% or more who at best will be very stingerly aided, and as economist Michael Hudson points out to let them repay their bank debts.
On November 24, Obama made his long-awaited announcement - his economic team to lead the nation out of its worst ever economic crisis, a task perhaps more than even Houdini could handle according to economist and author F. William Engdahl.
Nonetheless and with fanfare, the major media highlighted them with commentaries ranging from cautious to enthusiastic. The Wall Street Journal for example as follows:
"The advisors Mr. Obama named on Monday hail from the centrist part of the Democratic Party. During the Clinton years they played an important role in turning a budget deficit into a surplus. Now they argue the worsening economy requires steep deficit spending."
The New York Times stressed the ailing economy, prospective measures to help jump-start it, and efforts to "inject confidence into the trembling financial markets" that for the moment at least were reassured, or so it seemed.
Not for long according to Merrill Lynch economist David Rosenberg in a recent commentary. In January, he was the first Wall Street economist to predict recession, called it an "epic event," and said it will be long and painful as a result of at least three major shocks - credit, housing and oil.
He now sees the S & P 500 bottoming at around 660 or a 61.8% reversal from its high. Others see it even lower given a policy response "to get people to (spend more,) add to their debt burdens," and exacerbate the very problem that created the crisis. Rosenberg says it's "like giving an alcoholic another drink for his cure. We have a situation where Congress (and the Obama administration) want more credit created, even though it was excess (debt and) leverage that got us into this mess." In other words, the cure may be worse than the disease if the Obama team continues the same failed Bush administration policies, and it looks like they will.
In earlier comments, Rosenberg offered a different prescription in saying for the US economy to expand, savings must rise to the pre-bubble 8% level, housing stocks must come way down, and the household interest coverage ratio must fall to 10.5%. The future he sees is "frugality" with households having to make very different sorts of spending decisions than the kinds they've been used to for years. Those days are over.
So is world stability according to UK Telegraph writer Ambrose Evans-Pritchard in his latest November 30 commentary. He sees the "political bubble bursting (with) spreads on geo-strategic risk now widening as dramatically as the spreads on financial risk at the onset of the credit crunch."
From Mumbai to worker unrest in China to Eastern Europe and Russia at a time when it's "too early in this crisis to conclude whether Europe's monetary union is a source of stability, or is itself a doomsday machine" given the growing rift between "North and South" countries and Germany's reluctance "to unpin the system with a fiscal blitz."
He compares today to the 1930s. After the crash, stocks rallied sharply for months as though the worst was over. It was just beginning but who could know at the time. "The crisis came in pulses, each followed by months of normality - like today. The global system did not snap until September 1931," after which one event led to another and they were all bad, both political and economic. Who knows what's ahead today at a time debt excesses are far greater than then, and this is what Obama's team will confront.
According to Paul Krugman on December 1:
-- today's economic indicators are worse than at any point during Japan's 1990s contraction;
-- all conventional policy tools aren't working;
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I I HAD THE STRANGEST DREAM
by MARGARET BASET (0 articles, 0 quicklinks, 0 diaries, 345 comments [45 recommended, 0 rejected]) on Wednesday, Dec 3, 2008 at 7:08:27 AM  (0+)
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Reply: SORRY WRONG LINK
HOPE I DO BETTER THIS TIME http://www.youtube.com/watch?v=jBcwAJZGXsk by MARGARET BASET (0 articles, 0 quicklinks, 0 diaries, 345 comments [45 recommended, 0 rejected]) on Wednesday, Dec 3, 2008 at 7:28:35 AM (0+)
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And now?
Mr. Lendman presents a documented and penetrating criticism. However, what the nation most needs at this moment is a unifying vision that leads to effective action. This article offers no vision and no course of action. Having concluded that all the wrong people have stepped up to meet the challenges, now what would you like your engaged and worried readers to do to make the next 4/8 years transformative? Richmond PS: Margaret-Thanks for reminding us of John's vision. The world needs spirits like him. He put his music, his celebrity, and his money behind his hopes for the world. Pete Seeger is another. by Richmond Shreve (30 articles, 70 quicklinks, 17 diaries, 156 comments [5 recommended, 0 rejected]) on Wednesday, Dec 3, 2008 at 10:30:36 AM (0+)
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Reply: As usual, you're exactly wrong. What's needed is NOT, as
you say, "a unifying vision that leads to effective action." Ultimately, of course, effective action is necessary. But before such action is possible, the problem at hand needs an accurate analysis. You need to be clear about the nature of your problem before you can solve it. Otherwise, any attempted action will probably misfire, or even make the problem worse. Lendman's article is pointing out that the people Obama has picked to direct economic policy are the very individuals (or their protegés) who have driven us into the present ditch. Even if Lendman doesn't explicitly jot down the ultimate solution here, he is nonetheless making clear that Obama's team is "more of the same" -- and that this cannot possibly solve the crisis. Take the situation where you put a fox in charge of the chicken coop. Suppose an observer (like Lendman) points out that putting a fox in charge is dangerous. This warning is valuable and quite useful -- even if the observer doesn't make any addtional suggestions about who should be in charge of the chicken coop. Implicitly, however, Lendman's article is more than a mere warning that Summers, Rubin, & their kind are dangerous. He is suggesting what the nature of the basic malady is. He is saying, in so many words, that neoliberal economic policy always leads to disaster for most people, while enriching those at the top of the heap. Therefore, the fact that Obama is picking exclusively neoliberals to direct economic policy tells us that whatever his stylistic & rhetorical differences from Bush, his administration is also going to defend the interests of the plutocracy, while shifting the burden onto the backs of the rest of the population. Wall St itself is a cesspool. The rottenness & stinking corruption of the US economic & political system flows from corporate capitalism. It's ludicrous to imagine that a bunch of Wall St insiders, hedge fund managers, deregulators, & people who helped loot the Treasury on behalf of Wall St, could be chosen to "return the economy to health." Everyone has to understand this, before it's possible to decide on a course of "effective action." In fact, this point is a fundamental part of the "unifying vision" that's a prerequisite for any effective course of action. by Richard Mynick (2 articles, 4 quicklinks, 1 diaries, 1552 comments [255 recommended, 5 rejected]) on Wednesday, Dec 3, 2008 at 11:48:07 AM (0+)
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Obama's economic picks are dangerous
The policies developed and followed by the governments of the world, especially the major powers, will determine the future of humanitiy. Obama's choices for those who would guide this country's economic vision during his administration is deeply flawed as well argued by Mr. Lendman. My thanks to him for pointing out the flawed judgement these people have exercised in the past. The people who helped create this world-wide economic crisis cannot provide the vision to reverse it. Their past actions and words reveal their elitist view of the world, and the value they place upon 3rd world countries and their populations. Lawrence Summers stated in 1991: "There are no limits on the planet's capacity for absorption likely to hold us back in the foreseeable future. The danger of an apocalypse due to global warming or anything else is non-existent. The idea that the world is heading into the abyss is profoundly wrong. The idea that we should place limits on growth because of natural limitations is a serious error; indeed, the social cost of such an error would be enormous if ever it were to be acted upon. Contrary to his dangerous analysis, the exact opposite has been proven true. The social cost of not placing limits upon growth because of natural limitations are enormous. Just 17 short years later we have dwinding food supplies, including critical fisheries and grain production capacity. The demand for fresh water and fossel fuels has surpassed supply. Add to the equation the negative effect of global warming and exponential population growth, and it becomes rapidly clear it is dangerous to expect any effective vision to be developed by Obama's current economic team choices. I not only expected better, we must have better choices. I hope Congress will hold hearings during the appointment process and point out the need for him to change his choices.He can and must do better, the stakes are too high. by Jody Holder (0 articles, 0 quicklinks, 0 diaries, 2 comments) on Wednesday, Dec 3, 2008 at 3:56:26 PM (0+)
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Helter Skelter
Clinton's back in the White House.. I'm sure Obama will have a place for Monica in his staff. President elect Obama NEVER agreed with Hillary on any of her foreign policies, so why place her as Secretary of State? Sounds like he's trying to surround himself with people with experience since he doesn't have any.. was he ever on time to any of the Senate Meetings? Even Tom Brokaw said "We really know nothing about this man" I can't wait to see his Civilian Military, and seize our 401k plans. Where are all these new jobs coming from if he hits all the big companies with higher taxes? We will all be paying $5.00a gallon for gas again since he is anti drilling, and the gas companies will be forced to raise prices to pay the higher tax hikes. Most big companies will down size and send jobs overseas... President Obama.. You can keep the change by Don Bybee (0 articles, 0 quicklinks, 0 diaries, 116 comments [2 recommended, 0 rejected]) on Wednesday, Dec 3, 2008 at 6:25:44 PM (0+)
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More of the same... not at Obama's plate...
After reading the article of Lendman, I must conclude that he's not a successful business man. He lacks understanding and holds to a vision conjured from stereotypes and slogans. The comments that followed show more of the same. Come on, guys! The American left has a vision that can be defined as the one from a room with a view... in Urania, a planet around Sigma-Centuari. And the word progressive lost any meaning used to have long time ago. There is more brains in the little finger of our President-elect than in all the bloggers we find around. Instead of working hard at finding fault with the appointments, spend your time fixing your own houses, and defining what you want to with your lives. But of course, we always new that the fascism of the left was always fascinated with the fascism of the right, and both usually go to hell holding hands... and trying to drag everybody else along the way... by Frank Rommey (0 articles, 0 quicklinks, 0 diaries, 8 comments [3 recommended, 0 rejected]) on Wednesday, Dec 3, 2008 at 6:40:01 PM (0+)
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What's with the set-up?
O.K. then...I've got a Race Car that's Formula One. We've just obtained new sponsorship; a new deal and a new face to race. So we're gonna choose a pit crew and race strategists from competitors teams who bent, broke, and threw away the rules to win, alter and steal the races in the last go-round. Is this smart? The point is -- imposing a system of honor and excellence and savoir faire to "be successful" has got it achilles heel cut before the race begins. It'd be a miracle to get a sickly, evil tree to produce sweet, edible fruit wouldn't it? That's the point. What's with the set-up? by boomerang (0 articles, 7 quicklinks, 0 diaries, 556 comments [215 recommended, 1 rejected]) on Wednesday, Dec 3, 2008 at 11:54:46 PM (0+)
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dream team from hell
Too many proteges of Kissinger in that list... Didn't know about Richardson's affiliation but I am not surprised. Volker?? good god ! Dream team indeed.. more like a rogue's gallery. Btw..all you dreamers better wake the hell up. WHo ya gonna believe, the Obama propagnda machine or your own lyin eyes??!! Thanks for the article Stephen L. Too bad some of these stargazing obamabots haven't heard the neocons from far and wide praising this economic hit team, including their favorite guy of all time.. karl rove.. If that doesn't piss them off enough to see what a shill for the elite the president elect is nothing will. by jersey girl (0 articles, 0 quicklinks, 0 diaries, 1201 comments [734 recommended, 12 rejected]) on Thursday, Dec 4, 2008 at 5:59:35 AM (0+)
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