Wednesday, July 17, 2019

Today's Links

  What is the official Democratic explanation for why Mueller's hearing was delayed a week? I can't find it. No matter what it is, the actual explanation seems obvious: Dems realized they've set themselves up for a dud, and need to mitigate. And/or Mueller is still trying to bail.  aaron mate



1-- Veterans doubt value of wars in Iraq, Afghanistan in new poll


In a survey of nearly 1,300 veterans conducted in May and June, 64 percent of those surveyed said the war in Iraq was not worth fighting, as opposed to just 33 percent who said the security benefits outweighed the sacrifices.


For Afghanistan, 58 percent of veterans said that fight was not worthwhile, versus 38 percent who believed it was. Results from both questions closely track with the opinions of the American public at large.


2--Everything’s Fine Until Suddenly it Isn’t: How a “Leveraged Loan” Blows Up 


3--Bombshell revelations force Mueller to postpone testimony--The two main pillars supporting the Mueller report have been obliterated


on July 1, Judge Dabney Friedrich ordered Mueller to stop pretending he had proof that the Russian government was behind the Internet Research Agency’s supposed attempt to interfere via social media in the 2016 election. ...Mueller’s other twin charge — Russian hacking of the DNC — also has been shown, in a separate Court case, to be bereft of credible evidence.

No, the incomplete, redacted, second-hand “forensics” draft that former FBI Director James Comey decided to settle for from the Democratic National Committee-hired CrowdStrike firm does not qualify as credible evidence. Both new developments are likely to pose a strong challenge to Mueller. 

(Mueller's report now shown to lack evidence) "established that Russia interfered in the 2016 election principally through two operations. First, a Russian entity carried out a social media campaign that favored presidential candidate Donald J. Trump and disparaged presidential candidate Hillary Clinton. Second, a Russian intelligence service conducted computer-intrusion operations against entities, employees, and volunteers working in the Clinton campaign, and then released stolen documents.”...

Reporting Thursday on Judge Friedrich’s ruling, former CIA and State Department official Larry C. Johnson described it as a “potential game changer,” observing that Mueller “has not offered one piece of solid evidence that the defendants were involved in any way with the government of Russia.” After including a lot of useful background material, Johnson ends by noting:
“Some readers will insist that Mueller and his team have actual intelligence but cannot put that in an indictment. Well boys and girls, here is a simple truth–if you cannot produce evidence that can be presented in court then you do not have a case. There is that part of the Constitution that allows those accused of a crime to confront their accusers.”...

“Facebook cautioned that the Russia-linked posts represented a minuscule amount of content compared with the billions of posts that flow through users’ News Feeds everyday.”
The chances that Americans saw any of these IRA ads—let alone were influenced by them—are infinitismal. Porter and others did the math and found that over the two-year period, the 80,000 Russian-origin Facebook posts represented just 0.0000000024 of total Facebook content in that time. Porter commented that this particular Times contribution to the Russiagate story “should vie in the annals of journalism as one of the most spectacularly misleading uses of statistics of all time.”..

CrowdStrike, the controversial cybersecurity firm that the Democratic National Committee chose over the FBI in 2016 to examine its compromised computer servers, never produced an un-redacted or final forensic report for the government because the FBI never required it to, the Justice Department

4--Twitter CEO maxes out donations to Tulsi Gabbard... conspiracy machine kicks into overdrive


5--Iran--Ballistic missiles are not negotiable


“They can't have a nuclear weapon. We want to help them. We'll be good to them. We'll work with them. We will help them in any way we can,” Trump claimed. “But, they can't have a nuclear weapon. We're not looking, by the way, for regime change because some people say we're looking for regime change....They can't be testing ballistic missiles which right now under that agreement, if they had the agreement, which we are out of, they'd be able to do. They can't do that."


“If the US wants to talk about missiles , it should stop selling weapons including missiles to regional states,” Zarif said.
Tehran has time and again asserted that its defense missile program is non-negotiable.

6--FBI's spreadsheet puts a stake through the heart of Steele's dossier

Multiple sources familiar with the FBI spreadsheet tell me the vast majority of Steele’s claims were deemed to be wrong, or could not be corroborated even with the most awesome tools available to the U.S. intelligence community. One source estimated the spreadsheet found upward of 90 percent of the dossier’s claims to be either wrong, nonverifiable or open-source intelligence found with a Google search....

Steele’s theory about who in the Trump campaign might be conspiring with Russia kept evolving from Page to Cohen to former campaign chairman Paul Manafort. None of those theories checked out in the end, as the Mueller report showed.
Again, Steele’s intelligence was wrong or unverifiable....

Steele had some general things right, of course, including that the Russians were behind the hacking of the Democratic National Committee’s emails. (HUH??? Solomon selllout)

The FBI’s own spreadsheet was so conclusive that it prompted then-FBI Director James Comey (no fan of Trump, mind you) to dismiss the document as “salacious and unverified” and for lead FBI agent Peter Strzok to text, “There’s no big there there.” FBI lawyer Lisa Page testified that nine months into reviewing Steele’s dossier they had not found evidence of the collusion that Steele alleged.

7--Russia probe critic Gaetz accuses feds of shrugging off threat against him


8--Donald Trump’s fascist strategy


Trump equates opposition to his administration and criticism of his personal rule with support for terrorism, paving the way for the criminalization of free speech and critical thought. Trump states that his opponents are “dangerous” and “hate” the nation, suggesting that “complaining” about the policies of the government is treasonous. He presents socialism and communism as foreign ideologies directed against the American people.

These are ideas developed by Nazi theorists such as the jurist Carl Schmitt, who authored the conception of a “state of exception” to justify Nazi totalitarian rule. Lurking behind Trump’s assertion that those who are “not happy” and “want America to be socialist” should “leave” the US is the suggestion that if they fail to do so voluntarily, the government will be justified in rounding them up by force.

“Trump’s America is a ‘White Man’s Country,

9--Another nutty report from CNN--CNN peddles intelligence agencies’ lies against Assange

Despite the potentially sensitive nature of the UC Global material, CNN’s report is extraordinarily thin....

The report is based on the claims of the Democratic Party and the US intelligence agencies that material published by WikiLeaks in 2016 was provided by the Russian government. These included leaks of emails from the Democratic National Committee (DNC) and John Podesta, the chairman of Clinton’s campaign, along with secret speeches Clinton had earlier delivered to Wall Street bankers...

WikiLeaks 2016 publications proved that the DNC had sought to rig the Democratic Party primaries against self-proclaimed “democratic socialist” Bernie Sanders, and in favour of Clinton, in contravention of its own rules. They showed that Clinton had promised multi-billionaire bankers that she would govern in their interests and support more predatory US military interventions.
Documents also established that the Clinton Foundation was a massive cash for access scheme, whereby governments, corporations and individuals would provide sums of money, in return for meetings with the Clintons and other government figures.

10--Trump's attacks on "the squad"--Politics as usual??

Trump’s Sunday attack forced Pelosi to stand with her severest critics, and she re-elevated the race issue with this tweet: “When Trump tells four American Congresswomen to go back to their countries, he reaffirms his plan to ‘Make America Great Again’ has always been about making America white again.”

Do Democrats believe that refighting the racial battles of the 1960s that were thought to have been resolved is a winning hand in 2020?

Does Pelosi think that demeaning white America is going to rally white or minority Americans to Democratic banners?

The race issue had already arisen in the first debate when Sen. Kamala Harris called out front-runner Joe Biden for befriending segregationist Senate colleagues in the ’70s and ’80s, and for colluding with them to block court-ordered busing to achieve racial balance in the public schools.

Observing the clash between Trump and these women, the rank and file of the Democratic Party are being forced to take sides. Many will inevitably side with the fighters, as Democratic moderates appear timid and tepid.

Trump is driving a wedge right through the Democratic Party, between its moderate and militant wings. With his attacks over the last 48 hours, Trump has signaled whom he prefers as his opponent in 2020. It is not Biden; it is “the Squad.”

11--Farage--"The EU--A modern-day version of communism"?

In an election, having a choice of one is hardly open and democratic. This was a total stitch-up from the very beginning.

12--CNN Twists Embassy Surveillance Records That Were First Covered By Spanish Newspaper





Tuesday, July 16, 2019

Today's links

"Merciless review of Syriza's record, with comparisons to Yeltsin: "1 in 3 Greek workers on part-time salary of €317/month...incomes fell 30%, pensions 50%... ended universal health care...perfected techniques of police repression targeting workers" Failures of the Left in Greece, marc ames



1--A "No-deal" Brexit seems unavoidable

The one possible flaw in this plan, Deacon asserts, is that the EU leaders might decide a no-deal Brexit would be a lot more damaging to Britain than it would be to them. If that is what they think, they might not find the threat quite so compelling, leaving Deacon to paint an alternative scenario:
The British Government might as well be saying: "If I shoot myself in the foot with this machine gun, it's going to make a terrible mess of your carpet. Imagine the stain. Could take you a whole hour to get it out. All that scrubbing. Be a real nuisance for you. Plus you'd have to put up with the horrible sound of my screaming, as I writhe around in unspeakable agony on your floor until the paramedics arrive. Wouldn't be much fun for you, would it? Could ruin your evening. Do you really want that? Are you sure?"
This is about as close as it gets to pointing out how absurd the stance of the leadership candidates is, delivering us a train wreck where the only choice is the side of the rails from which we want the doomed train to plunge

2--The Epstein Affair--The hidden conflicts within the Deep State are emerging, and the resulting crisis will be explosive.

I have long held that there is a camp within the Deep State that grasps the end-game of Neocon globalism, and is busy assembling a competing nation-centric strategy. There is tremendous resistance to the abandonment of Neocon globalism, not just from those who see power slipping through their fingers but from all those firmly committed to the hubris of a magical faith in past success as the guarantor of future success....

The faction within the Deep State that no longer accepts traditional fictions is gaining ground, and now another fracture in the Deep State is coming to the fore: the traditionalists who accept the systemic corruption of self-serving elites and those who have finally awakened to the mortal danger to the nation posed by amoral self-serving elites.
The debauchery of morals undermines the legitimacy of the state and thus of the entire power structure. As I recently noted in Following in Rome's Footsteps: Moral Decay, Rising Inequality (June 29, 2019), America's current path of moral decay and soaring wealth/power inequality is tracking Rome's collapse step for step.
Enter the sordid case of Jeffrey Epstein, suddenly unearthed after a decade of corporate-media/elitist suppression. It's laughable to see the corporate media's pathetic attempts to glom onto the case now, after actively suppressing it for decades:Jeffrey Epstein Was a Sex Offender. The Powerful Welcomed Him Anyway. (New York Times) Where was the NYT a decade ago, or five years ago, or even a year ago?

3--Another PR Disaster?  Boeing 737 Max ordered by Ryanair undergoes name change 


4--Syria Battle Map 


5--EU's Mogherini: Iran commitment reduction no significant JCPOA noncompliance


6--Follow Up on the Flynn Plot by Larry C Johnson


What the CIA did not tell the FBI is that the Brennan's CIA apparently had helped arrange, albeit indirectly via the Israelis, Flynn's gig with INOVO. When Flynn was pressured by the FBI to file documents under the Foreign Agents Registration Act, he was being manipulated into a lie. The record that has emerged in the last couple of weeks, thanks to his new lawyer, Sidney Powell, shows that former FBI Chief of the National Security Division’s Counterintelligence and Export Control Section, David Laufman, played a critical role in pressuring Flynn to file.


7--Elizabeth Warren espouses economic nationalist policies aligned with Donald Trump


Friends who knew her as a young adult describe Warren at that time as a “die-hard conservative,” in an era when that meant support for Senator Barry Goldwater and opposition to the civil rights movement. She was a registered Republican until 1996—when she was 47 years old—although in a recent interview she claimed to have voted for only one Republican presidential candidate, Gerald Ford in 1976. It appears that her party registration corresponded to whatever predominated among the faculty at the university where she was teaching economics: a Republican while in Texas; a Republican ticket-splitter at the University of Pennsylvania; a down-the-line Democrat after a tenured appointment at Harvard.

Warren’s campaign biography and media profiles emphasize the shift in her political views in the course of the 1990s, as she became an increasingly prominent researcher and writer in the sphere of bankruptcy economics. She was the most conservative of a trio of economic researchers who undertook an empirical study of personal bankruptcy filings, which included extensive field studies of individual cases and refuted the prevailing academic prejudice that those who filed for bankruptcy were spendthrifts and wastrels exploiting the system. Instead, the researchers found that most of those filing for personal bankruptcy were victims of various social misfortunes: a severe illness, an unexpected job loss or pay cut, divorce, an automobile accident, etc. Rather than taking advantage of the system, they were themselves cruelly used by lenders and regulators....

Warren’s basic standpoint is one of economic nationalism, spelled out most fully in two documents: an article published in Foreign Affairs last January and a statement on “economic patriotism” issued by her campaign in June.

The Foreign Affairs article is notable for its overlap with the policies of Donald Trump. Warren espouses economic nationalism. She, like Trump, claims to stand up for the interests of American workers and condemns most recent trade deals from that standpoint, although she calls for inclusion of the unions in the process of negotiation.

More fundamentally, she embraces the national security doctrine outlined by the Pentagon under Defense Secretary James Mattis, in which great power competition with China and Russia has displaced terrorism as the principal concern of US strategic planners. She writes: “Whether our leaders recognize it or not, after years as the world’s lone superpower, the United States is entering a new period of competition. Democracy is running headlong into the ideologies of nationalism, authoritarianism and corruption. China is on the rise… Russia is provoking the international community with opportunistic harassment and covert attacks. Both nations invest heavily in their militaries and other tools of national power.”...

Her policy prescription amounts to a purportedly more polite and diplomatic version of what Trump seeks to do by bullying and threats of trade warfare: reworking trade deals to make them more favorable to the United States, opposing China’s rise to a more powerful position in the world economy, and using the threat of denying access to US markets to force other countries to bow to US demands....

Another function of Warren’s deep faith in the capitalist market is her role as the “idea factory” for the Democratic presidential field. Her campaign has issued more than a dozen major policy documents. According to a recent tabulation by the New York Times, these include a wealth tax, universal child care, breaking up big tech companies, encouraging low-income housing, agriculture, greater accountability for corporate executives, corporate taxation, the management of public lands, cancellation of student debt and free college, reducing maternal mortality, military housing, Puerto Rico debt relief, the opioid crisis, climate change, abortion rights, economic patriotism and green manufacturing.

8--Epstein's shadowy and inexplicable past 

9--Blowback in Honduras--

US-trained troops shot activists protesting the Juan Orlando Hernandez government’s attempt to privatize education and healthcare.


10--Globalization’s Wrong Turn

And How It Hurt America


11--A Case Could Be Made That Unregulated Capitalism Is Destroying the World


Monday, July 15, 2019

Today's links

1---China rises while US slumps

Neither China nor the US is overly trade-dependent. Trade accounts for 26% of America’s GDP and 37% of China’s–compared to 56% of Canada’s and 86% of Europe’s. Chinese imports are 18.7% of GDP and US imports are 14.6% of GDP.
Over the past ten years China has steadily reduced her overall reliance on trade, particularly with the USA. China’s net exports–exports minus imports–are two percent of GDP. Since 2007 China’s global current-account surplus has fallen from 10% of GDP to 1.4% but America’s deficit has remained unchanged.

China is America’s biggest trading partner while America is China’s third biggest trading partner after the EU and ASEAN. ASEAN replaced the US as China’s second-largest export market last year and the signing of the Regional Comprehensive Economic Partnership[2] later this year will boost area trade significantly.
Though it is due to come into force next year, China has already granted all the benefits of the EU-China Bilateral Investment Agreement to European investors without requiring reciprocity. Belt and Road trade is rising 17.2% annually, trans-Eurasian trains now depart hourly and fiber-optic cables and pipelines are rapidly uniting Mackinder’s World Island, the Eurasian landmass.

China is lowering tariffs and opening domestic markets to attract multinationals and foreign products in order to force domestic companies to innovate, which is why it is now the largest recipient of foreign direct investment, FDI, in the world.

  • There are thousands of US Corporations in China and two-thirds of the largest exporters in China are foreign-owned.
  • Boeing sells more airplanes to China than anywhere else and Walmart produces more goods from China than any other company in the world.
  • US companies in China sell $600 billion annually into China’s domestic market–$100 billion more than China exports to the US–and generate net profits of $50+ billion annually.
  • Tesla, Boeing, BMW of America, Exxon Mobil and Wal-Mart have announced new investments and factories in China since the trade war began and Japanese, South Korean, and European companies are expanding their footprints there because Chinese sales are growing six percent annually.
  • Of the factories operated by Apple’s top suppliers, 357 are in China and 63 are in America. Apple is shifting Mac Pro manufacturing from the US to China.
  • By shortening its negative list for foreign investment from 63 items to 48 last month, China widened access to its primary, secondary and tertiary sectors and detailed 22 opening-up measures in finance, transportation, professional services, infrastructure, energy, resources and agriculture.
  • China’s domestic consumer market, at $7 trillion, passed the US’s $6.94 trillion last year.
  • Chinese cross-border e-commerce consumers spent $100 billion on goods from abroad in 2017 and $128 billion in 2018.

Twenty years ago Samuel Huntington[3] observed, “Civilizations grow because they have an instrument of expansion, a military, religious, political, or economic organization that accumulates surplus and invests it in productive innovations and they decline when they stop the application of surplus to new ways of doing things. In modern terms we say that the rate of investment decreases. This happens because the social groups controlling the surplus have a vested interest in using it for non-productive but ego-satisfying purposes which distribute the surpluses to consumption but do not provide more effective methods of production.”

As the chart below makes clear, the social groups controlling America’s surplus used it for non-productive, ego-satisfying purposes and distributed the surpluses to consumption but did not provide more effective methods of production...

We’ve cut R&D investment, shuttered our great corporate labs and fallen from first to thirty-first in world education rankings since 1974, while China has done the opposite. In Crazy Rich Asians a father urges his kids to finish their dinner, “Think of all the starving children in America”. By 2021 every Chinese will have a home, a job, plenty of food, education, safe streets, health and old age care and there will be more suicides and more homeless, poor, hungry children and imprisoned people in America than in China. In absolute numbers. Think of the impact on our ‘allies...

December 10, 2018. Governments and secret services in the non-Western world begin equipping themselves exclusively with Huawei to protect the confidentiality of their communications...

December 24, 2018. Chinese imports posted a 14.6% rise for the first eleven months of 2018 to exceed US$2 trillion, a record high, making China the most powerful trading nation both by volume and dollar value  

2--Edward Snowden--

The law simply has not caught up to the fact that a technological corporation now can indenture entire populations into servitude to the corporate good, rather than to individual or public good.

3--Erdogan's missteps?? 

Syrian Civil War

The explanation has, basically, two components. One is the series of serious strategic and political missteps taken by Erdogan and his team, centering on (but not limited to) the disastrous decision they took in August 2011 to buy into Barack Obama’s call for the overthrow of Syria’s President Bashar al-Assad. The other is the re-emergence of a portion of the influence that Moscow used to enjoy in the Middle East, in the context of President Vladimir Putin having consolidated enough power at home to be able to think of cautiously projecting some back into the Levant—and of him being aided in doing this by the diplomatic smarts of Foreign Minister Sergey Lavrov and his team.

Turkey’s support for the regime change project in Syria opened the whole of the 500-mile, often mountainous border between the two states for a massive, years-long delivery of arms, money, and foreign fighters to the anti-Assad fighting forces in northern Syria, with nearly all the costs born by Saudi Arabia, the UAE, and Qatar. But the anti-Assad forces failed to win the speedy victory that their backers in Washington and Ankara had so confidently predicted. As the fighting dragged on, Turkey increasingly started to suffer blowback in the form of anti-Ankara activities undertaken both by some of the takfiri extremists it had supported in Syria and by allies of the Kurdish forces who emerged as a serious, organized force in northeastern Syria....

From 2015 on, southeastern Turkey became engulfed in a brutal civil war. Meanwhile, just across the border in Syria, U.S. troops were working closely with the main ethnic Kurd movement, the YPG, a fanatically loyal subsidiary of the PKK, spouting the pensees of PKK leader Abdulah Ocalan (long imprisoned in Turkey) in all their “political training” sessions. Ankara has remained outraged at the U.S.-YPG coordination ever since....

The Syrian government is understandably eager to regain Idlib, but it would need significant help from Russia to do so. Idlib, meanwhile, contains thousands of extreme takfiri fighters, a large proportion of whom are foreigners who flocked there, with Turkey’s help, from scores of countries around the world whose governments do not want them to return home. Turkey also does not want Idlib’s seasoned takfiri fighters (who have broad support networks inside Turkey) to retreat to Turkey. So, since September 2017, it has been working actively with Russia to try to slow the Syrian forces’ advance.

4--Obama's lies on democracy, human rights, pluralism, good governance and economic development lead to lost US power and prestige in ME

Fast forward to 2011: the Obama administration has adopted the right discursive position on Syria. It declared the Assad regime to be illegitimate in August 2011, well in advance of Turkey doing the same.

In fact, on 9 August 2011, I held six hours of long talks with President Bashar al-Assad himself. We agreed on a 14-point framework for a peaceful transition and a two-week period for him to declare this framework after necessary preparations.

We informed our American counterpart about the deal. Yet the US administration was rushing to declare the Assad regime illegitimate, which it did only a week after we agreed upon the framework deal. Needless to say, during the same time period, the Assad regime also violated the terms of this framework deal several times. Thereafter, we also cut all contacts with the regime.

Along the same lines, the Obama administration rightly condemned the brutality of the Assad regime, called for regime change and denoted the use of chemical weapons as red lines that would trigger a military response and lead to severe repercussions for the Assad regime.

All these publicly declared positions and red lines have since been violated by the Assad regime with more or less impunity, not least by the use of chemical weapons in August 2013.

On a more bilateral note, even though the Obama administration denoted the Assad regime early on as illegitimate and rightly accused him of committing grave crimes, including crimes against humanity, the same administration has also proven to be unsympathetic towards the difficulties, challenges and threats that Turkey has faced as a neighbour to a war-torn country nominally ruled by an illegitimate regime.

From the flow of millions of refugees into the country to Syria-induced Islamic State (IS) and PKK terrorism, Turkey has faced a myriad of hardships and threats.
In other words, this illegitimate regime was the source of these challenges and threats for Turkey, yet the Obama administration was unwilling to recognise it as such and act upon it accordingly.
On the contrary, at the end of the day, the Obama administration allowed Assad’s brutality to continue while supporting "his ally" Turkey’s foes, on the ground...

The more the West consents to the authoritarian comeback in the region, the more it risks the erosion of democracy in their own national contexts. Europe doesn't appear to realise that it has only a fluid border, in the shape of the Mediterranean Sea, between itself and the MENA..

Fourth, if not reversed, Trump’s belittling of the European integration project and downplaying of the significance of NATO will shake the bond between the transatlantic community, which again will be counter-productive to US national interests....

Obama’s lacklustre foreign policy legacy should motivate the new US administration to devise a new democracy and human rights-oriented, people-friendly foreign policy. It should strengthen its ties with its current allies and search for new ones.

5--The permanent recession

Sure, we got outstanding growth in stocks, but growth in business revenue has been pathetic. Growth in corporate development has been even worse (i.e., new plants, improved productivity, etc.) Growth in earnings was decent, except for the fact that it is entirely a feint because it was created mostly by reducing the numbers of outstanding shares over which earnings are divided, not so much by growing business. (Why do you think Wall Street prefers to talk about “earnings per share, ” EPS, instead of just actual profits?)

We can pretend the strength in EPS was because business has been booming during the “long economic expansion,” but it wasn’t. We got less production growth out of this expansion than in any other expansion in US history, and that is easy to prove with the Fed’s own data. GDP went up, but the rate of growth in GDP has been in secular decline during each expansion:

Oops. Worse than pathetic. Using consistent accounting through time, we discover we have actually been in receding GDP (recession) since 2000 with the exception of one little bump in 2004. We don’t want to admit that, so we we’ll just ignore that by saying we improved our accounting methods over time.
And that is why I say “It’s been a great recession” because we never actually left the Great Recession. Rather than the longest expansion in US history, we’ve been enduring the longest recession in US history ever since the dot-com bust. The above chart shows the GDP growth rate, and the REAL GDP “growth” rate, which has actually been contraction, not growth, for the past two decades if measured by historic standards. So long as GDP is growing, (above 0 on the chart above), we’re in expansion. Whenever GDP is shrinking (below 0 on the chart above), we’re in recession.

6--US warns Turkey against launching military operation east of Euphrates


7--House Democrats ratify $733 billion for US military


8--US-China trade negotiations at virtual standstill


9--Pentagon says--More nukes needed


10--The Democrat's stealth candidate--Buttigieg (The Deep State is now running its own nominees)

Buttigieg has been the most aggressive holder of high-dollar fundraisers, attending dozens of such events, particularly in California and the northeast, and raising much of his money from Silicon Valley and Wall Street.


he is a veteran of naval intelligence, having served a tour of duty in Afghanistan, where he helped identify targets for assassination squads.

These attributes—comparative youth, identity as a gay man and a background in military intelligence, together with his public embrace of religion (he is a practicing Episcopalian)—make Buttigieg something of a made-to-order candidate from the standpoint of the Democratic Party establishment. His candidacy ticks a number of boxes: anchoring the primary campaign in a right-wing national security perspective; employing youth and identity to appeal to the predominately youthful supporters of Sanders; and elevating a right-wing figure as a “next-generation” leader of the Democrats, although perhaps a more likely candidate for the vice presidency than the top job....

n the media, Buttigieg is described as a 37-year-old “boy wonder,” an “intelligent and worldly man” who speaks seven languages, whose speeches on the campaign trail exude intelligence and thoughtfulness, a former Rhodes scholar and graduate of Harvard and Oxford, who, driven by the ideal of public service, returned to his humble Midwestern roots to become mayor of his impoverished hometown, and who single-handedly sparked a renaissance in South Bend after a half-century of urban decay.

As usual, the media depiction is largely at odds with reality.

One of the most noteworthy features of Buttigieg’s campaign so far is its political amorphousness. Even by the standards of American capitalist elections, where issues of concern to the working class are systematically excluded from the public discussion, Buttigieg has distinguished himself by his reluctance to take concrete positions on major political questions. His campaign website initially had no reference to policies, speaking only of the need to restore “values.”

As the campaign has developed, Buttigieg has taken substantive political positions that demonstrate he is a thoroughly establishment figure, aligned more with the “moderate” wing of the Democrats headed by former Vice President Joe Biden, and flatly opposed to the policies identified with Sanders. Buttigieg rejects the single-payer “Medicare for All” slogan proposed by Sanders and taken up by many other Democrats in favor of the establishment of a “public option” available on the health insurance exchanges set up under Obamacare...

The city has one of the highest eviction rates in the country, which has doubled under the mayor, according to the Eviction Lab at Princeton University. In households with working adults, 54 percent do not earn enough to meet a ‘survival budget,’ according to the United Way.”

Buttigieg was talent-spotted early and has moved in the top circles of the US national security establishment from the time he left college. From 2004 to 2005 (when he was 22 and 23), he worked as a conference director for the Cohen Group, a Washington-based consultancy that advises clients on international investment strategies.

The Cohen Group is headed by former Republican Senator William Cohen, who was secretary of defense under Democratic President Bill Clinton. Its principals, besides Cohen, include Marc Grossman, undersecretary of state for political affairs in the Bush administration and special representative for Afghanistan and Pakistan under Obama; retired General Joseph Ralston, who concluded a 37-year Air Force career as chief of the European command and supreme allied commander, Europe; and Nicholas Burns, US ambassador to NATO and Grossman’s successor as undersecretary of state for political affairs under Bush.

This aspect of Buttigieg’s resumé closely resembles that of Barack Obama, who worked for CIA-connected Business International at age 21-22, making connections within the national security apparatus that stood him in good stead during his meteoric political rise.

From 2007 to 2010, the year before his first mayoral campaign, Buttigieg served as a consultant at McKinsey & Company, an international consulting firm with revenues of over $10 billion.

Media comments suggest that the Democratic Party sees one of the functions of Buttigieg’s campaign as preventing Bernie Sanders from winning the nomination. An opinion piece in the Washington Post headlined “Buttigieg might save the Democratic Party from Sanders,” applauded Buttigieg’s public criticism of Sanders’ occasional use of the word “socialism.” Buttigieg said: “I think of myself as progressive. But I also believe in capitalism, but it has to be democratic capitalism.” The Post author commented: “In many ways, Buttigieg is ideally suited to take on Sanders for the hearts, minds and political survival of the Democratic Party.”

In 2014, during his first term as mayor, Buttigieg was deployed to Afghanistan, where he was a member of the Afghan Threat Finance Cell, a counter-terrorism group established in 2008 by then-commanding General David Petraeus. Through his work in this task force, Buttigieg was involved in activities that placed individuals on the US military’s “kill or capture list,” targeting these opponents of the US occupation for assassination or extraordinary rendition to a CIA black site.
Two of the seven languages in which Buttigieg claims fluency are Arabic and Dari (the Afghan dialect of Persian, spoken by about one-third of the population). Such language skills are likely the product of intensive military-intelligence training.

The presence of ex-military officers in the Democratic field is part of a larger process, the direct incorporation of military and intelligence figures into the leading personnel of the Democratic Party, a phenomenon the World Socialist Web Site identified among Democratic candidates for Congress in 2018 (see: The CIA Democrats).

Buttigieg is also on the board of directors of the Truman Center, an imperialist foreign policy group. Other board members include former Secretary of State Madeleine Albright and Leon Panetta, former CIA director and secretary of defense. The Truman Center is a veritable training center for CIA Democrats, offering workshops and messaging guidelines for up-and-coming politicians. It boasts on its website: “Our community includes more than 1,700 post-9/11 veterans, frontline civilians, policy experts, and political professionals who share a common vision of US leadership abroad.”
Buttigieg’s relative silence on foreign policy issues cannot be explained by a disinterest or lack of knowledge. It can be explained only as a deliberate attempt to avoid airing views he knows are widely unpopular, but which are mainstream within the Democratic Party.

When he finally delivered a significant foreign policy address, in May, it was at the Hamilton Lugar School of Global and International Studies at Indiana University, which is named in honor of former Democratic Congressman Lee H. Hamilton and former Republican Senator Richard G. Lugar, both pillars of the foreign policy establishment.

In light of Buttigieg’s national security background, his campaign proposal for the establishment of a “national service” program has particularly ominous implications. Buttigieg argues that such a program is necessary to promote a feeling of unity and “social cohesion” within the American population. In reality, such a program would amount to a return to the draft, combined perhaps with labor conscription, which could be used to suppress wages and living standards in the working class.

Whether or not Buttigieg ultimately wins the nomination, and at this point the possibility seems remote, his sudden elevation in advance of the primaries flows from definite political considerations within the Democratic Party itself. Whoever ultimately wins the nomination must be acceptable to the corporate aristocracy and the military apparatus the Democrats represent. However, the debacle of the Hillary Clinton campaign revealed, much to the Democrats’ surprise, that any figure publicly identified with social inequality and war is liable to be deeply hated, particularly within the working class.

One gets the sense that the Democratic Party is attempting replicate its success with Barack Obama, whose formless demagogy about “hope” and “change” was able to divert popular hostility to the political establishment, allowing the voters to see in him what they wanted to see. Buttigieg’s status as the first gay man to become a serious presidential hopeful would thus parallel Obama’s role as the “first black president.”
In the context of popular disillusionment with eight bitter years under Obama, however, it is unlikely the Democrats will be able to pull off the same trick twice.

11--Police launch mass arrests on Bastille Day in Paris

By Will Morrow and Alex Lantier
15 July 2019
Two hundred thirty years after the storming of the Bastille prison launched the French Revolution in 1789, President Emmanuel Macron’s government carried out mass preventive arrests, rounding up well known “yellow vest” protesters on Bastille Day in Paris yesterday. Macron was booed and jeered as he drove in the motorcade down the Champs-Elysées on the traditional military parade Sunday morning.
According to the Paris police prefecture, 175 people were arrested throughout the day, most of them in locations around the annual military parade down the Champs-Elysées avenue. Almost all the arrests were based on charges of “organization of an unauthorized demonstration.”

They ruling classes internationally are orienting towards police-state measures and the promotion of fascistic and far-right forces against the workers. In the United States, the Trump administration has begun mass round-ups of undocumented immigrants. In Germany, the political establishment and media have legitimized and promoted the neo-fascist Alternative for Germany as the official opposition party. It has covered up for the assassination of a major German politician, Walter Lübcke, by an individual with close ties to neo-Nazi networks.

12--Democrats back mass deportations


Sunday, July 14, 2019

Today's Links

1--G-Sax targets China's bond market--The next pot of gold??

2--It’s not a new problem, so why does the media only care about dead migrant children under Trump?


Why should anyone believe the media's their showy displays of grief and horror are sincere now, given their silence during the Obama years, when many of the same policies causing outrage now were also in place then?

 The Obama administration deported more migrants than any previous administration, with children “moved to the head of the line to be turfed out. ...


It would be inaccurate to say that there was no coverage of the crisis while Obama was president. There was some bland, less-emotional coverage. There was also some in-depth reporting which captured the extent of the crisis — but there was no mass media mobilization against Obama himself. The facts and death tolls were not plastered across the cable news networks night and day. No one argued that Obama was shaming America.


A 2015 lawsuit described “inhumane” conditions in border detention facilities under Obama. Men, women and children, it said, were “packed into overcrowded and filthy holding cells with the lights glaring day and night.” They suffered “in brutally cold temperatures; deprived of beds, bedding, and sleep,” were denied adequate food, water and medical care, as well as “basic sanitation items” like soap, toilet paper and diapers. This all while the media treated Obama with kid gloves and liberals sang his praises....


The biggest elephant in the room, however, is not that the Obama administration was guilty of many of the same things as the current one. It’s that every single US administration for decades has been guilty of contributing to the creation of this crisis through an abominable imperialist foreign policy that has ravaged the very countries these migrants are coming from....


Democrats and Republicans have spent decades enthusiastically destabilizing Latin America under the guise of democracy promotion. In reality, they have stolen its wealth and resources, engineered military coups and installed dictators, funded and equipped death squads — and imposed deadly economic sanctions. Where are all the liberals crying about that? How could such inhumane policy have led to anything else?


3--Major Gas Pipeline In Syria Knocked Offline In Mysterious 'Sabotage Attack


4--No inflation?? It depends where you look

Asset price inflation is not benign. It’s not a free lunch. It loads up the financial system with systemic risks and future losses.

The Fed has expressed this worry in various forms for three years. Certain corners at the ECB have started to grumble about it too. And even the Bank of Japan is murmuring about the “sustainability” of its QE program, and its impact on the financial markets.
This is why money-printing cannot be maintained without setting the stage for another, and much bigger and even more magnificent collapse of the financial system, and all the real-economy mayhem that this would trigger.

It doesn’t make any difference whether this money printing takes place at a central bank or at the government. This is a cosmetic distinction. It always destroys the purchasing power of the currency with regards to assets, and therefore it destroys the purchasing power of labor with regards to assets, such as housing. And it pumps huge risks into the financial system that eventually lead to big losses that invariably get very costly for society to resolve.

5--Arming Kurdistan

The Syrian Democratic Forces (SDF) received at least 1,730 trucks loaded with military supplies from the U.S. after the liberation of the last ISIS stronghold in northeastern Syria last March, the Syrian Observatory for Human Rights (SOHR) revealed on July 14.
According to the UK-based monitoring group, the last two shipments included around 280 trucks loaded with logistics and military supplies.
“The SOHR observed the entry of around 280 new trucks coming from northern Iraq, in two batches, to the SDF-held areas east of the Euphrates River,” the monitoring group’s report read.
The motive behind these military supplies remains unclear. ISIS has been defeated in northeastern Syria, according to the US-led coalition itself.

6--The despised Macron booed on Bastille Da

7--Roger Waters condemns Twitter "thought police"

8--Trump admin to impose sanctions on Turkey for buying Russian S-400 air defense systems


9--Will Democratic Party Superdelegates Prevent a Progressive Nominee in 2020?

Saturday, July 13, 2019

Extra Supplement--Huey Long

Huey Long--American Socialist

Socialism-- any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods

The economic crisis of the 1930s presented American radicals with their greatest opportunity to build a third party since World War I, but the constitutional system and the brilliant way in which Franklin Delano Roosevelt co-opted the left prevented this.....
Franklin Roosevelt succeeded in undercutting the growth of left-wing political movements in the mid-1930s by adopting much of the rhetoric of the left and co-opting many of its leaders.

Long advocated free higher education and vocational training, pensions for the elderly, veterans benefits and health care, and a yearly stipend for all families earning less than one-third the national average income – enough for a home, an automobile, a radio, and the ordinary conveniences. Long also proposed shortening the work week and giving employees a month vacation to boost employment, along with greater government regulation of economic activity and production controls. He later proposed a debt moratorium to give struggling families time to pay their mortgages and other debts before losing their property to creditors.

Long charged that the nation’s economic collapse was the result of the vast disparity between the super-rich and everyone else. A recovery was impossible while 95% of the nation’s wealth was held by only 15% of the population. In Long’s view, this concentration of money among a handful of wealthy bankers and industrialists restricted its availability for average citizens, who were already struggling with debt and the effects of a shrinking economy. Because no one could afford to buy goods and services, businesses were forced to cut their workforces, thus deepening the economic crisis through a devastating ripple effect.

“The same mill that grinds out the extra rich is the same mill that will grind out the extra poor, because, in order that the extra rich can become so affluent, they must necessarily take more of what ordinarily would belong to the average man,” said Long.

By the summer of 1935, there were more than 27,000 Share Our Wealth clubs with a membership of more than 7.5 million. Loyal followers met every week to discuss Long’s ideas and spread the message. There were no dues, just fellowship and discussion, and membership was open to all races. White supremacists charged that Long was attempting to organize blacks to vote. Long countered that Share Our Wealth was meant to help all poor people, and black people were welcome to participate since they were the poorest people in the country – a radical inclusion for a deeply segregated society.

A political poll by the Roosevelt re-election team, the first national poll of its kind, revealed that Long was siphoning key Democratic support from FDR's campaign. Democratic National Committee Chairman James Farley estimated that Huey could draw up to 6 million popular votes in the 1936 election. According to aides, Roosevelt hoped to “steal Long’s thunder” by embracing some of his causes.
Long’s rapid rise in national popularity is credited with Roosevelt’s Second New Deal of 1935, a more liberal version of his New Deal agenda, which included proposals for Social Security (old age pensions), the Works Progress Administration (public works projects), the National Youth Administration (financial aid and employment for students), the National Labor Relations Board (rights of unions to organize, minimum wage and 40-hour work week), the Public Utility Holding Company Act (regulation of public utilities), the Farm Security Administration (assistance to farmers), and the Wealth Tax Act (graduated income and inheritance taxes).

FDR adopted some of Huey’s ideas in order to “steal Long’s thunder,” while simultaneously moving to discredit him.

FDR also moved to deflate Long’s appeal by incorporating some of Huey’s ideas as part of the Second New Deal, a more liberal version of his Great Depression reforms. For example, the Social Security system reflected Huey’s proposal for old-age pensions, the Works Progress Administration mirrored public works programs begun by Long in Louisiana, and the National Youth Administration reflected his student financial aid proposal. Other initiatives championed by Long and implemented by FDR included the National Labor Relations Board (rights of unions to organize, minimum wage and 40-hour work week), the Public Utility Holding Company Act (regulation of public utilities), the Farm Security Administration (assistance to farmers), and the Wealth Tax Act (graduated income and inheritance taxes). 

As governor, Long introduced massive reforms to Louisiana. He sponsored free textbooks and night courses, built new schools across the state, paved 3,000 miles of new roads to improve transportation, oversaw the building of a new airport, and encouraged the construction of a new medical school at Louisiana State University. Even more impressively, he did all of this without placing a major tax burden on the average Louisianan. Instead, Long placed the burden on big business, heavily taxing major industries like oil.

His long-term plans were even more progressive, including universal healthcare and universal free education. However, some were wary of Long. He held tightly onto power, bribed others to cooperate, and became a practical dictator over his state. In fact, he was nearly impeached for misconduct, but survived by a margin of 2 votes. 

In 1930, Long's rhetoric and reputation got him elected as Louisiana's Great Depression era senator to the United States Congress. Before leaving, he rigged elections in Louisiana to make sure that his handpicked successor became the next governor, letting Long essentially continue to run his state from Washington. It was around this time that he acquired the nickname that history would remember him by: the Kingfish.

Long and the New Deal

Long burst onto the national scene and became instantly popular. The starving poor of the Depression loved his continual slogan of ''every man a king'', as well as his proposed reforms proposals for free education, pension for retirees, and a national minimum wage.

As governor, Long introduced massive reforms to Louisiana. He sponsored free textbooks and night courses, built new schools across the state, paved 3,000 miles of new roads to improve transportation, oversaw the building of a new airport, and encouraged the construction of a new medical school at Louisiana State University. Even more impressively, he did all of this without placing a major tax burden on the average Louisianan. Instead, Long placed the burden on big business, heavily taxing major industries like oil.

His long-term plans were even more progressive, including universal healthcare and universal free education. However, some were wary of Long. He held tightly onto power, bribed others to cooperate, and became a practical dictator over his state. In fact, he was nearly impeached for misconduct, but survived by a margin of 2 votes.

In 1930, Long's rhetoric and reputation got him elected as Louisiana's Great Depression era senator to the United States Congress. Before leaving, he rigged elections in Louisiana to make sure that his handpicked successor became the next governor, letting Long essentially continue to run his state from Washington. It was around this time that he acquired the nickname that history would remember him by: the Kingfish.

Long and the New Deal

Long burst onto the national scene and became instantly popular. The starving poor of the Depression loved his continual slogan of ''every man a king'', as well as his proposed reforms proposals for free education, pension for retirees, and a national minimum wage.

FDR only shifted left when a gun was at his head

Franklin Roosevelt demonstrated his skill at co-opting the rhetoric and demands of opposition groups the year before his 1936 reelection, when the demagogic Senator Huey Long of Louisiana threatened to run on a third-party Share-Our-Wealth ticket. This possibility was particularly threatening because a “secret” public opinion poll conducted in 1935 for the Democratic National Committee suggested that Long might get three to four million votes, throwing several states over to the Republicans if he ran at the head of a third party. At the same time several progressive senators were flirting with a potential third ticket; Roosevelt felt that as a result the 1936 election might witness a Progressive Republican ticket, headed by Robert La Follette, alongside a Share-Our-Wealth ticket.

To prevent this, Roosevelt shifted to the left in rhetoric and, to some extent, in policy, consciously seeking to steal the thunder of his populist critics. In discussions concerning radical and populist anticapitalist protests, the president stated that to save capitalism from itself and its opponents he might have to “equalize the distribution of wealth,” which could necessitate “throw[ing] to the wolves the forty-six men who are reported to have incomes in excess of one million dollars a year.” Roosevelt also responded to the share-the-wealth outcry by advancing tax reform proposals to raise income and dividend taxes, to enact a sharply graduated inheritance tax, and to use tax policy to discriminate against large corporations. Huey Long reacted by charging that the president was stealing his program.

President Roosevelt also became more overtly supportive of trade unions, although he did not endorse the most important piece of proposed labor legislation, Senator Robert Wagner’s labor relations bill, until shortly before its passage.

Raymond Moley, an organizer of Roosevelt’s “brain trust,” emphasized that the president, through these and other policies and statements, sought to identify himself with the objectives of the unemployed, minorities, and farmers, as well as “the growing membership of the Congress of Industrial Organizations (CIO), Norman Thomas’ vanishing army of orthodox Socialists, Republican progressives and Farmer-Laborites, Share-the-Wealthers, single-taxers, Sinclairites, Townsendites [and] Coughlinites.”

The economic crisis of the 1930s presented American radicals with their greatest opportunity to build a third party since World War I, but the constitutional system and the brilliant way in which Franklin Delano Roosevelt co-opted the left prevented this.

On the assumption that the 1937–38 recession had undermined Roosevelt’s prestige, Wisconsin governor Philip La Follette attempted in 1938 to create a new third party, the National Progressives of America. The president responded with a renewed effort to co-opt such opposition

Franklin Roosevelt succeeded in undercutting the growth of left-wing political movements in the mid-1930s by adopting much of the rhetoric of the left and co-opting many of its leaders.
President Roosevelt recognized that the long-range interests of his coalition and the Democratic Party were best served by encouraging radical groups, whether inside or outside the party, to feel as though they were part of his political entourage. Thus, as we have seen, he showed a willingness to endorse local and statewide third-party or independent candidates and give them a share of federal patronage. In return, they were expected to support the president’s reelection.

The fact that left-wing parties did not make significant inroads during the Great Depression dramatically demonstrated not only the power of America’s coalitional two-party system to dissuade a national third party but also the deeply antistatist, individualistic character of its electorate.

The economic crisis of the 1930s was more severe in the United States than in any other large society except Germany. It presented American radicals with their greatest opportunity to build a third party since World War I, but the constitutional system and the brilliant way in which Franklin Delano Roosevelt co-opted the left prevented this. The Socialist and Communist Parties saw their support drop precipitously in the 1940 elections. America emerged from the Great Depression as the most antistatist country in the world.


Today's Links

 All the financial and economic instruments of the state, above all the Fed, are dedicated to the sole goal of enriching the financial oligarchy, no matter what the consequences. wsws


“We owe it to everyone who flies, passengers and crews alike, to do much better than to design aircraft with inherent flaws that we intend pilots will have to compensate for and overcome.”  “Sully” Sullenberger



1-- The case of Jeffrey Epstein and the depravity of America’s financial elite

By all accounts, Epstein, to satisfy his and others’ sexual or psychological needs, deliberately set out to prey on the poor and defenseless. Courtney Wild, who says she was 14 when she met Epstein, told the Miami Herald, “Jeffrey preyed on girls who were in a bad way, girls who were basically homeless. He went after girls who he thought no one would listen to and he was right.”

The newspaper later adds, “Most of the girls came from disadvantaged families, single-parent homes or foster care. Some had experienced troubles that belied their ages: They had parents and friends who committed suicide; mothers abused by husbands and boyfriends; fathers who molested and beat them. One girl had watched her stepfather strangle her 8-year-old stepbrother, according to court records obtained by the Herald

“‘We were stupid, poor children,’ said one woman, who did not want to be named because she never told anyone about Epstein. At the time, she said, she was 14 and a high school freshman. ‘We just wanted money for school clothes, for shoes. I remember wearing shoes too tight for three years in a row. We had no family and no guidance, and we were told that we were going to just have to sit in a room topless and he was going to just look at us. It sounded so simple, and was going to be easy money for just sitting there.’”..

Our era is one of exploding and all but unpunished crime by the wealthy and connected,” she writes. “The Epstein scandal blows holes through the foundational myths of our time, revealing them for the empty and sickening bromides used to justify obscene wealth and power and privilege that they really are.”

2-- Russiagate is going up in smoke

Don’t look now, but a federal judge in Washington, D.C., has just shut down half of Robert Mueller’s Russian-interference case.
In February 2018, the special prosecutor indicted a St. Petersburg troll farm called the Internet Research Agency along with two other companies, their owner, Yevgeniy Prigozhin, and 12 employees.  The charge: fraud, traveling to the United States under false pretenses, and using social media platforms such as Facebook and Twitter to “sow discord” and “interfere in US political and electoral processes without detection of their Russian affiliation.”

The charge was both legally dubious and heavy-handed, a case of using a sledge hammer to swat a fly.  But Mueller went even further in his report, an expurgated version of which was made public in April.  No longer just a Russian company, the IRA was now an arm of the Russian government. “[T]he Special Counsel’s investigation,” it declared on page one, “established that Russia interfered in the 2016 election principally through two operations.  First, a Russian entity carried out a social media campaign that favored presidential candidate Donald J. Trump and disparaged presidential candidate Hillary Clinton.  Second, a Russian intelligence service conducted computer-intrusion operations against entities, employees, and volunteers working in the Clinton campaign and then released stolen documents.”

“Prigozhin,” the report added, referring to the IRA owner, “is widely reported to have ties to Russian President Vladimir Putin.”  A few pages later, it said that the IRA’s efforts “constituted ‘active measures’ … a term that typically refers to operations conducted by Russian security services aimed at influencing the course of international affairs.”

Thus, the IRA played a major role in the vast Kremlin conspiracy to alter the outcome of the 2016 election and install Donald Trump in office.  But now Judge Dabney Friedrich has ordered Mueller to stop pushing such stories because they’re unfair to Concord Management and Consulting, another Prigozhin company, which astonished the legal world in May 2018 by hiring an expensive Washington law firm and demanding its day in court....

Prigozhin was forcing the special prosecutor to show what he’s got, McCarthy went on, at zero risk to himself since he was not on U.S. soil.  What was once a no-lose proposition for Mueller was suddenly a no-lose proposition for Putin’s unexpectedly clever cook.
Now Mueller is in an even worse pickle because he’s barred from mentioning a major chunk of his report...

Facebook Vice President Rob Goldman tweeted that “the majority of the Russian ad spend happened AFTER the election

3--Fed signals it will bow to Wall Street’s demands

Powell said the “bottom line” was the uncertainties about global growth and trade that “continue to weigh on the outlook.” He also pointed to weaker readings on inflation, suggesting that inflation rates below the Fed target of two percent could be more persistent than previously anticipated. This was a significant change from previous language, in which the Fed said continued low inflation was due to “transitory” factors. Powell said low inflation “strengthened the case for a somewhat more accommodative policy.”

He also pointed to the agreement between Trump and Chinese President Xi Jinping to resume trade talks as “constructive,” but said it did not remove the “uncertainty that we see as weighing on the outlook.”

Rounding out a presentation calculated to provide justification for Wall Street’s insatiable demand for cheaper money to finance its parasitic activities, Powell pointed out that business investment has “slowed notably” and that overall growth of the US economy in the second quarter “appears to have moderated...

The official line of the Fed is that a more accommodative monetary policy is necessary to provide a boost to the economy. This is a lie from start to finish. Any cut in interest rates, like the much-touted tax cuts the Trump administration claimed would boost the creation of well-paying jobs, will do nothing to lift investment and expand the real economy.
Rather, they will help finance the ever greater accumulation of wealth at the heights of society, placing more money in the hands of the financial oligarchy and providing cheap funds for job-destroying mergers and acquisitions and share buy-backs that boost the value of Wall Street stock....

There is “no money” because all the economic and financial agencies of the capitalist state operate as institutionalised mechanisms for siphoning up the wealth produced by the labour of the working class. This process of wealth extraction is being intensified to meet Wall Street’s demands.

While the stock market appears to be a kind of financial heaven, where money, provided at ultra-low interest rates, seems to simply beget more money, it does, in the final analysis, rest on the surplus value extracted from the working class. Thus, the process of financial accumulation is necessarily accompanied by the development of new methods for increasing this exploitation and cutting social services, which constitute a drain on the surplus value available for appropriation in the form of profit by finance capital.

These processes are not merely the outcome of the policies of the Trump administration, which can be corrected by reforms to the operation of the financial system and the underlying economy. Trump is simply the personification of a process going back decades...

All the financial and economic instruments of the state, above all the Fed, are dedicated to the sole goal of enriching the financial oligarchy, no matter what the consequences.

4--More bad news for Boeing

Multiple reports have focused on the previously little known piece of software known as the Maneuvering Characteristics Augmentation System (MCAS) as the cause of both crashes. MCAS, an anti-stall system, was developed by Boeing ostensibly to make the Max 8, first introduced in 2017, “one of the safest airplanes ever to fly.”

EASA’s checklist, however, indicates the exact opposite: that Boeing’s flagship aircraft has numerous potentially catastrophic structural problems that cannot be fixed with a software patch. These include difficulty in turning the manual trim wheel, unreliable angle-of-attack sensors, poorly designed training features, lagging microprocessors and an autopilot that sometimes fails to disengage properly.

These issues, taken together, indicate that the 737 Max 8 should never have been certified to fly in the first place. They suggest that Boeing executives and US Federal Aviation Administration (FAA) regulators participated in a profit-driven rush to produce and launch the plane while cutting corners on design safety and pilot training.

 5--No longer able to compete, US opts for military buildup

“From East Asia to the Middle East to Eastern Europe, authoritarian actors are testing the limits of the international system and seeking regional dominance while challenging international norms and undermining US interests,” Milley said. “Our goal should be to sustain great power peace that has existed since World War II, and deal firmly with all those who might challenge us.”

Asked by the chairman of the Senate panel, Oklahoma Republican Senator James Inhofe, what he was most concerned about in terms of the US confrontation with China and Russia, Milley responded: “I think the very No. 1 for me and No. 1 stated for the Department of Defense is the modernization, recapitalization of the nation’s nuclear triad. I think that’s critical. Secondly, I would say, is space. It’s a new domain of military operations.”

“I think China is the main challenge to the US national security over the next 50 to 100 years,” General Milley, said.

Questioned by Georgia Republican Senator David Perdue on Chinese “global expansion,” Milley provided a clear window into the advanced preparations by US imperialism for war with China.
He charged that China is “using trade as leverage to achieve their national security interests and the One Belt, One Road is part of that.” He said that China is “primarily in competition for resources to fund and improve their military and build and fuel their economy.”..

Milley’s testimony comes barely a month after the Pentagon briefly posted and then yanked off the internet a 60-page document titled “Joint Publication No. 3-72 Nuclear Operations.” The document, prepared at the request of the current Chairman of the Joint Chiefs of Staff Marine Gen. Joseph Dunford, has since been classified as “for official use only.”
The document spells out the Pentagon’s shift from the Cold War era doctrine of mutually assured destruction (MAD) to the concept of a limited use of nuclear weapons resulting in a winnable war.

 The chilling testimony delivered by Milley on Thursday, spelling out US imperialism’s preparations for war with China and the increasing turn toward a doctrine of a “winnable” nuclear war, was accompanied by pledges from both Democratic and Republican senators that they would quickly confirm the general’s nomination.

Friday, July 12, 2019

Today's Links

FDR: “…our basic trouble was not an insufficiency of capital. It was an insufficient distribution of buying power coupled with an over-sufficient speculation in production. While wages rose in many of our industries, they did not as a whole rise proportionately to the reward to capital, and at the same time the purchasing power of other great groups of our population was permitted to shrink. We accumulated such a superabundance of capital that our great bankers were vying with each other, some of them employing questionable methods, in their efforts to lend this capital at home and abroad. I believe that we are at the threshold of a fundamental change in our popular economic thought, that in the future we are going to think less about the producer and more about the consumer. Do what we may have to do to inject life into our ailing economic order, we cannot make it endure for long unless we can bring about a wiser, more equitable distribution of the national income.”

FDR: “Appraising the situation in the bitter dawn of a cold morning after, what do we find? We find two-thirds of American industry concentrated in a few hundred corporations…We find more than half of the savings of the country invested in corporate stocks and bonds, and made the sport of the American stock market. We find fewer than three dozen private banking houses, and stock-selling adjuncts of commercial banks, directing the flow of American capital. In other words, we find concentrated economic power in a few hands…We find a great part of our working population with no chance of earning a living except by grace of this concentrated industrial machine; and we find that millions and millions of Americans are out of work, throwing upon the already burdened Government the necessity of relief…We find the Republican leaders proposing no solution except more debts, more conferences under the same bewildered leadership, more Government money in business but no Government attempt to wrestle with basic problems…I believe that our industrial and economic system is made for individual men and women, and not individual men and women for the benefit of the system.”

1--Stocks rally on bad news--

The latest poor trade data comes after a string of disappointing economic reports from around the globe, which showed that the global economy suffered from a protracted U.S.-China trade war that forced major central banks to take a more accommodative stance, which in turn has pushed US stocks to fresh all time highs. China is also due to release second-quarter GDP figures on Monday which are expected to show the world’s second-largest economy slowing to its weakest pace in at least 27 years....

In rates, the recent rout continued as European government bonds extended their declines, heading for the worst week since at least October, after the industrial output print beat. German government bonds were set for their biggest weekly selloff in nearly one-and-a-half years, as yields jumped from -0.40% to -0.24% and the French 10Y yield has risen from -0.14% to +0.06%, as signs of economic strength in the United States and parts of Europe suggested fears of a downturn may be overdone.

2--Iran’s IRGC unleashes fire on terrorist positions along border with Iraqi Kurdistan


3--Turkey using proxy forces to take complete control over Hama and Idlib: expert


4--Turkey preparing for massive operation east of Euphrates: media


5--Two Colleagues Contradict Brennan's Denial of Reliance on Dossier 


6--Learning From the New Deal's Mistakes


7--Keynes letter to FDR

. Broadly speaking, therefore, an increase of output depends on the amount of purchasing power, compared with the prime cost of production, which is expected to come on the market. Broadly speaking, therefore, an increase of output cannot occur unless by the operation of one or other of three factors. Individuals must be induced to spend more out of their existing incomes; or the business world must be induced, either by increased confidence in the prospects or by a lower rate of interest, to create additional current incomes in the hands of their employees...; or public authority must be called in aid to create additional current incomes through the expenditure of borrowed or printed money. In bad times the first factor cannot be expected to work on a sufficient scale. The second factor will come in as the second wave of attack on the slump after the tide has been turned by the expenditures of public authority. It is, therefore, only from the third factor that we can expect the initial major impulse

The set-back which American recovery experienced this autumn was the predictable consequence of the failure of your administration to organise any material increase in new loan expenditure during your first six months of office. The position six months hence will entirely depend on whether you have been laying the foundations for larger expenditures in the near future.  ....

he other set of fallacies, of which I fear the influence, arises out of a crude economic doctrine commonly known as the quantity theory of money. Rising output and rising incomes will suffer a set-back sooner or later if the quantity of money is rigidly fixed. Some people seem to infer from this that output and income can be raised by increasing the quantity of money. But this is like trying to get fat by buying a larger belt. In the United States to-day your belt is plenty big enough for your belly. It is a most misleading thing to stress the quantity of money, which is only a limiting factor, rather than the volume of expenditure, which is the operative factor. ...
If you were to ask me what I would suggest in concrete terms for the immediate future, I would reply thus.

In the field of domestic policy, I put in the forefront, for the reasons given above, a large volume of loan-expenditures under government auspices. It is beyond my province to choose particular objects of expenditure. But preference should be given to those which can be made to mature quickly on a large scale, as for example the rehabilitation of the physical condition of the railroads. The object is to start the ball rolling. The United States is ready to roll towards prosperity, if a good hard shove can be given in the next six months.

I put in the second place the maintenance of cheap and abundant credit and in particular the reduction of the long-term rates of interest. ... I see no reason why you should not reduce the rate of interest on your long-term government bonds to 2.5% or less with favourable repercussions on the whole bond market, if only the Federal Reserve System would replace its present holdings of short-dated Treasury issues by purchasing long-dated issues in exchange. Such a policy might become effective in the course of a few months, and I attach great importance to it.

With these adaptations or enlargements of your existing policies, I should expect a successful outcome with great confidence. How much that would mean, not only to the material prosperity of the United States and the whole World, but in comfort to men's minds through a restoration of their faith in the wisdom and the power of government!
With great respect, Your obedient servant
JM Keynes

8--Franklin Delano Obama?, Krugman 2008

F.D.R. did not, in fact, manage to engineer a full economic recovery during his first two terms. This failure is often cited as evidence against Keynesian economics, which says that increased public spending can get a stalled economy moving. But the definitive study of fiscal policy in the ’30s, by the M.I.T. economist E. Cary Brown, reached a very different conclusion: fiscal stimulus was unsuccessful “not because it does not work, but because it was not tried.”
This may seem hard to believe. The New Deal famously placed millions of Americans on the public payroll via the Works Progress Administration and the Civilian Conservation Corps. To this day we drive on W.P.A.-built roads and send our children to W.P.A.-built schools. Didn’t all these public works amount to a major fiscal stimulus?

Well, it wasn’t as major as you might think. The effects of federal public works spending were largely offset by other factors, notably a large tax increase, enacted by Herbert Hoover, whose full effects weren’t felt until his successor took office. Also, expansionary policy at the federal level was undercut by spending cuts and tax increases at the state and local level.

9--The Alternative Media Can Defeat the Mainstream Media - Here's the Game Plan

Over the last few decades, the political establishment and its media allies have created a powerful intellectual defense against major criticism by investing considerable resources in stigmatizing the notion of so-called “conspiracy theories.” This harsh pejorative term is applied to any important analysis of events that sharply deviates from the officially-endorsed narrative, and implicitly suggests that the proponent is a disreputable fanatic, suffering from delusions, paranoia, or other forms of mental illness. Such ideological attacks often effectively destroy his credibility, allowing his actual arguments to be ignored. A once-innocuous phrase has become politically “weaponized.”
However, an effective means of circumventing this intellectual defense mechanism may be to adopt a meta-strategy of reframing such “conspiracy theories” as “media criticism.”...

A similar strategy in broader form is applied by my Unz Review alternative media webzine, which hosts numerous different writers, columnists, and bloggers, all tending to sharply challenge the establishment media narrative along a wide variety of different axes and issues, some of them conflicting. By raising serious doubts about the omissions and errors of our mainstream media in so many different areas, the goal is to weaken the perceived credibility of the media, leading readers to consider the possibility that large elements of the conventional narrative may be entirely incorrect.

10--Bonnie Faulkner interviews Michael Hudson

Notes and Links  ---FDR

Here’s a clip from yesterday’s speech where Bernanke makes the case for even more austerity:
“The prospect of increasing fiscal drag on the recovery highlights one of the many difficult tradeoffs faced by fiscal policymakers: If the nation is to have a healthy economic future, policymakers urgently need to put the federal government’s finances on a sustainable trajectory….The solution to this dilemma, I believe, lies in recognizing that our nation’s fiscal problems are inherently long-term in nature. Consequently, the appropriate response is to move quickly to enact a credible, long-term plan for fiscal consolidation. By taking decisions today that lead to fiscal consolidation over a longer horizon, policymakers can avoid a sudden fiscal contraction that could put the recovery at risk.

But the definitive study of fiscal policy in the ’30s, by the M.I.T. economist E. Cary Brown, reached a very different conclusion: fiscal stimulus was unsuccessful “not because it does not work, but because it was not tried.”

This may seem hard to believe. The New Deal famously placed millions of Americans on the public payroll via the Works Progress Administration and the Civilian Conservation Corps. To this day we drive on W.P.A.-built roads and send our children to W.P.A.-built schools. Didn’t all these public works amount to a major fiscal stimulus?
Well, it wasn’t as major as you might think. The effects of federal public works spending were largely offset by other factors, notably a large tax increase, enacted by Herbert Hoover, whose full effects weren’t felt until his successor took office. Also, expansionary policy at the federal level was undercut by spending cuts and tax increases at the state and local level.

And F.D.R. wasn’t just reluctant to pursue an all-out fiscal expansion — he was eager to return to conservative budget principles. That eagerness almost destroyed his legacy. After winning a smashing election victory in 1936, the Roosevelt administration cut spending and raised taxes, precipitating an economic relapse that drove the unemployment rate back into double digits and led to a major defeat in the 1938 midterm elections.

This history offers important lessons for the incoming administration.
The political lesson is that economic missteps can quickly undermine an electoral mandate. Democrats won big last week — but they won even bigger in 1936, only to see their gains evaporate after the recession of 1937-38. Americans don’t expect instant economic results from the incoming administration, but they do expect results, and Democrats’ euphoria will be short-lived if they don’t deliver an economic recovery.
The economic lesson is the importance of doing enough. F.D.R. thought he was being prudent by reining in his spending plans; in reality, he was taking big risks with the economy and with his legacy. My advice to the Obama people is to figure out how much help they think the economy needs, then add 50 percent. It’s much better, in a depressed economy, to err on the side of too much stimulus than on the side of too little.
In short, Mr. Obama’s chances of leading a new New Deal depend largely on whether his short-run economic plans are sufficiently bold. Progressives can only hope that he has the necessary audacity.

What one needs is to set a strategic direction for renewal of economic activity. We need to create the institutions that will support that direction. Those institutions are public institutions, which create a framework for private activity. This is the way it is done. It is the way countries have always developed in the past and, to the extent that they are successful, they will always do so in the future or they won’t succeed. Seventy years ago when we were in the Great Depression, they built a national infrastructure: roads, airfields, schools, power-grids – this kind of thing was the priority. In the post-war period, the creation and maintenance of a large middle class with social security, with medical care, with housing programs, universities – these were the priorities of the post-war period.
Now we clearly face an enormous challenge with energy and climate. It’s a challenge that requires us to think in very creative ways, in very ambitious ways about how to change how we live, so as to make life on the planet tolerable a century or two centuries hence. This is a huge challenge. It requires design, planning, implementation, something with enormous potential for providing employment because things have to be done, enormous potential for guiding new public and private investment because one has to provide people with the means of making it realistic for individual activity to support this larger objective. And that is the way to move toward a renewed economic expansion. This strikes me very far from being a stimulus proposal. It is a proposal for setting a new strategic direction for the economy and doing so over a relatively long time horizon with a view that you’re sustaining effort for 15, 20, 30 years. That’s the way I think you need to think about this.

Federal Deposit Insurance Corporation,

New Deal programs alone weren’t enough to end the Great Depression.
According to Linda Gordon, professor of history at New York University, the Works Progress Administration, created in 1935, also had a positive impact by employing more than 8 million Americans in building projects ranging from bridges and airports to parks and schools.
Such programs certainly helped end the Great Depression, “but were insufficient [because] the amount of government funds for stimulus wasn’t large enough,” she notes. “Only World War II, with its demands for massive war production, which created lots of jobs, ended the Depression.”

Christina Romer

For a start, New Deal intervention saved the banks. During Hoover's presidency, around 20 percent of American banks failed, and, without deposit insurance, one collapse prompted another as savers pulled their money out of the shaky system. When Roosevelt came into office, he ordered the banks closed and audited. A week later, authorities began reopening banks, and deposits returned to vaults.
Congress also established the Federal Deposit Insurance Corporation, which, as economists Milton Friedman and Anna Jacobson Schwartz wrote, was "the structural change most conducive to monetary stability since ... the Civil War." After the creation of the FDIC, bank failures almost entirely disappeared. New Dealers also recapitalized banks by buying about a billion dollars of preferred stock

John Maynard Keynes

federal Revenue Act of 1932  
The Revenue Act of 1932 (June 6, 1932, ch. 209, 47 Stat. 169) raised United States tax rates across the board, with the rate on top incomes rising from 25 percent to 63 percent. The estate tax was doubled and corporate taxes were raised by almost 15 percent.
Taxable Items included dye, chewing gum, furs, soft drinks, and sporting goods; firearms, shells, and cartridges; coal, coke, and copper ore; telegraph, telephone, cable, and radio dispatches; and checks, jewelry, matches, refrigerators, stamps, and toiletries, and this act enacted one of the first taxes on gasoline.

Early on, the New Deal put too much public power in private hands. Conservative critics now focus on the National Recovery Administration, which created government-licensed cartels so that industries could self-regulate. Modern NRA critics have good historical company: Many New Dealers disliked the NRA, and Roosevelt himself eventually admitted it was "pretty wrong." The NRA established boards to set prices, wages, and conditions of work. These boards were supposed to have representatives from management, labor, consumers, and government -- but in practice fewer than 10 percent had labor representatives, even fewer had consumer representatives, and the government representative was normally someone from the ranks of management. One New Dealer noted only two cases when the government enforced codes of behavior on businessmen against their wishes.
As a result, as the historian Andrew Wender Cohen points out, the NRA boards provided legitimacy for businessmen wanting to coerce each other -- as happened when a group of smaller-scale kosher butchers made trouble for the mighty Schechter group -- and generally afforded businessmen an opportunity to collude in price-fixing. Which is why the NRA became unpopular and moribund before the Supreme Court found it unconstitutional early in 1935.

The New Deal also moved too slowly and cautiously to provide fiscal stimulus. Massive public works entered the New Deal pipeline early on with the creation of the Public Works Administration. But these big projects took a long time to plan and start. The Civilian Conservation Corps began immediately with the Roosevelt administration, but it employed only young men. Late in 1933, realizing a need for more immediate aid, Roosevelt created the Civil Works Administration, which directly employed some 4 million Americans on public works projects -- but nervous about establishing a permanent precedent, the administration dissolved the CWA in the spring of 1934, leaving American workers to fend for themselves.
Not until 1935 did Roosevelt inaugurate the Works Progress Administration with the goal of giving jobs to the employable unemployed. And even then he disliked direct federal employment -- he cut WPA jobs in 1937 when signs of recovery began to appear, which was much too soon. As Keynes wrote to him, to act as if recovery were assured when it had only just begun was an "error of optimism," and Roosevelt needed to invest more heavily in public works to avert further disaster

The New Deal tax code was also unkind to ordinary Americans. Roosevelt largely continued Hoover's tax policy, under which much of the federal revenue derived from excise taxes, especially those on alcohol and tobacco, disproportionately affecting the worse off. The controversial wealth taxes of 1935 affected hardly anyone -- famously, the top bracket captured only John D. Rockefeller -- and not until the war did the income tax structure change significantly.
Overall, the New Deal was never truly Keynesian. Not until 1938 did New Dealers adopt a plan of fiscal stimulus, and then they applied the principle timidly, running too small a deficit to matter. Not until the war did budget deficits and government spending grow large enough to produce results.
When New Deal policies did help workers, they disproportionately benefited white men. Construction jobs went to men as a matter of custom, and benefits went to whites as a matter of politics. Still dependent on segregationists for a national majority, the Democrats of the 1930s often yielded local control of New Deal agencies to Southerners unsympathetic to black laborers. Although the New Deal did help African Americans -- enough to make a difference in their voting, as black voters increasingly backed Democrats -- black Americans did not benefit equally to their white neighbors.

The FDIC, a more flexible Federal Reserve Board, the Securities and Exchange Commission, the legalization of collective bargaining, the National Labor Relations Board, and the minimum wage all began during the New Deal and have had a reasonably good record since then. Further, the public works programs provided not only relief but valuable public investment that, as the historian Jason Scott Smith points out, yielded dividends in economic growth for decades afterward. Perhaps most important, the New Deal brought Americans federal unemployment and old-age insurance, which not only rendered later downturns less severe but made Americans less dependent on the fickle largesse of their employers, if only ever so slightly. And here, too, the Obama administration might take one final historical lesson: Roosevelt's advisers wanted to establish public health care as part of their program to protect Americans from "economic insecurity" but left it out in anticipation of opposition. Let's have hope this new New Deal can be bolder

Congress passed the Revenue Act of 1932 five months before Franklin Roosevelt won his bid for the White House. But key elements of the law -- including an array of regressive consumption taxes -- remained a cornerstone of federal finance throughout the 1930s. The 1932 act imposed the largest peacetime tax increase in American history. Congress expected it to raise roughly $1.1 billion in new revenue, much of it from the rich. Lawmakers raised incom

most of these consumption taxes fell squarely on the shoulders of Roosevelt's famous Forgotten Man. Yet once in office, the new president did nothing to reduce them. Indeed, excise taxes provided anywhere from a third to half of federal revenue throughout the 1930s.

Most New Dealers were not Keynesians -- at least not initially and not when it came to taxes. Why did Roosevelt tolerate regressive taxation? Because he needed the money. The president -- and most of his economic advisers -- believed that unchecked borrowing posed a threat to recovery. While English economist John Maynard Keynes was urging the president to embrace an aggressive program of debt-financed spending, many New Dealers clung to more orthodox notions of public finance.

Keynesians were a rare breed in the early 1930s. (Indeed, the word "Keynesian" didn't enter popular usage until 1938, when countercyclical fiscal policy began to attract a broader following.) Most policymakers believed that government spending could help spur recovery, but few endorsed wholesale fiscal intervention. "Despite enormous, if not profligate spending, the New Deal has never achieved the volume or kind of pump-priming expenditure which Keynes insists is necessary to start private enterprise going," The Washington Post observed in 1934.

Keynes himself said as much in a December 1933 letter to FDR. "The set-back which American recovery experienced this autumn was the predictable consequence of the failure of your administration to organise any material increase in new Loan expenditure during your first six months of office," he scolded the president. "The position six months hence will entirely depend on whether you have been laying the foundations for larger expenditures in the near future."

Pump priming did accelerate toward the middle of the 1930s, but it was never adequate to the task. As economist E. Cary Brown later concluded, stimulatory fiscal policy failed to end the Depression, "not because it did not work, but because it was not tried."

Spending never had a chance to spur recovery because taxes kept going up. Both parties worshiped at the altar of fiscal responsibility. In 1932 they had competed to see who could inflict more pain on the American taxpayer, with Democratic leaders even sponsoring a manufacturers' sales tax (ultimately defeated by a rank-and-file rebellion). With revenue in a free fall, policymakers across the political spectrum felt compelled to raise taxes.

FDR, for his part, remained deeply conflicted when it came to fiscal stimulus. On one hand, he was genuinely committed to the notion that budgets should be balanced -- someday, at least. His close friend and Treasury secretary, Henry Morgenthau, was even more averse to red ink. But Roosevelt also wanted to spend. So he embraced regressive elements of the 1932 tax act, convinced that consumption tax revenue was indispensable. Later he championed a series of additional tax hikes in 1935, 1936, and 1937.

Since 1934, Treasury economists had repeatedly urged the president to lower taxes on the poor; they wanted to expand the income tax and use resulting revenue to pay for excise tax repeal. But the president cast his lot with a different group of advisers: Treasury lawyers more interested in soaking the rich than saving the poor. FDR embraced this approach in 1935, driven by a keen instinct for political opportunism. The New Deal faced a challenge from the left, particularly in the colorful person of Sen. Huey Long. The Louisiana populist was making headlines with his tax plans to share the wealth, and Roosevelt was determined to steal his thunder..

World War II changed the politics of taxation forever -- or at least for the next 50 years or so. Driven by staggering revenue needs, lawmakers in both parties agreed to raise taxes on everyone: rich, poor, and -- especially -- the middle class. Treasury economists got the broad-based income tax they'd been seeking since 1934; the number of people paying the levy increased sevenfold in just a few years. But New Deal lawyers got their high rates on the rich, too. The top marginal rate for individual income tax payers reached 94 percent in 1944, and effective rates on the top 1 percent reached nearly 60 percent the same year.

Roosevelt's tolerance for excise taxation was almost certainly unwise; by almost any calculation, the 1932 revenue act slowed recovery at the worst possible moment. But Roosevelt understood that regressive taxes had a role to play. In the early years of the New Deal, he accepted them as a fiscal necessity. Later he chose them deliberately to finance the New Deal's most important innovation: Social Security.