On October 12th the Washington Post came out with the following headline: “IMF: Austerity is much worse for the economy than we thought”.
“Earlier this week, the International Monetary Fund made a striking admission in its new World Economic Outlook. The IMF’s chief economist, Olivier Blanchard, explained that recent efforts among wealthy countries to shrink their deficits — through tax hikes and spending cuts — have been causing far more economic damage than experts had assumed.”
2--Higher Household Debt Primarily Means Fewer Foreclosures, Dean Baker
The NYT badly misinterpreted data suggesting that household debt may soon be rising again. The NYT noted the fact that households may be taking on debt again on net and argued that this may presage an uptick in the economy. In fact, it suggest nothing of the sort.
At any point in time tens of millions of households are taking on new debt by buying homes, taking out student loans, borrowing against a credit or card or taking out other loans. At the same time, tens of millions of families are reducing their debt, most importantly by paying down mortgages. In addition, much debt is being eliminated as a result of being written off by creditors, mostly through bankruptcy or foreclosure.
The reason that debt has been falling in the last few years has been due to the large amount of debt being written off, primarily as a result of foreclosures. To get an idea of this magnitude, suppose that 1 million homes a year go through the foreclosure process. If we assume an average mortgage of $200,000 a home (roughly the magnitudes involved), this would imply the elimination of $200 billion in debt each year, assuming that the households taking on new debt were just balanced by the households paying off debt. If the number of foreclosures fell in half to 500,000, and nothing else changed, then the rate at which debt was being reduced would fall to $100 billion a year.
3--Don't count on an accurate vote count, Harvey Wasserman
The idea that the Chamber of Commerce and the GOP's horde of billionaire backers would spend hundreds of millions of dollars to capture the White House and Congress but stop short of a few electronic key strokes is nonsensical.
- Despite an almost total blackout from the corporate media, the Romney family has a personal ownership (through the investment firms Solamere and H.I.G. Capital) in Hart Intercivic, which owns, maintains, programs and will tabulate alleged votes on machines in the critical swing states of Ohio, Florida, Virginia and Colorado. Despite various official disclaimers, the election could be decided on Hart machines producing "vote counts" with little connection to how 18 million people actually voted.
- It is inconceivable that the Romney chain of ownership in Hart Intercivic will not influence how that goes. The story has gotten widespread circulation on the internet, but has been ignored or dismissed by most of the corporate media and attacked by the Democratic Party. Petitions at Moveon.org and elsewhere call for a Department of Justice investigation. Tens of thousands of citizens have signed on. But there is no legally binding way by which a professionally rigged electronic vote count can be overturned or even definitively discovered except through the use of unabridged but legally inconsequential exit polling.
- Scytl, a Barcelona-based e-voting company, has been contracted to count votes in 26 states through the easily rigged Federal Overseas Voting Program. FVAP is ostensibly geared to let military and other overseas Americans vote absentee by electronic means. But Scytl is positioned to intercept and redistribute such overseas electronic votes as needed through its spyware sister company, CarrierIQ. In a close race, these "votes" can be distributed at will to make the difference in critical swing states.
- Other key voting machine companies, such as ES&S, Dominion, Command Central and more, are controlled by major corporations, some of whose owners are outspoken in their support for the Republican Party. Such support is reminiscent of Diebold owner Walden O’Dell, whose election software and machines helped give George W. Bush a second term in 2004, as O’Dell promised.
- Republicans hold the governorships in the nine critical swing states of Florida, Virginia, Pennsylvania, Ohio, Michigan, Wisconsin, Iowa, New Mexico and Arizona. They also hold the secretaries of state offices in all of those states but Wisconsin. Electronically flipping the vote count in any or all of them, with Hart Intercivic, Scytl, Dominion or other technologies, can be done quickly, simply and invisibly, with no public recourse.
Many will claim that Obama was stymied by a Republican Congress. But the primary policy framework Obama put in place – the bailouts, took place during the transition and the immediate months after the election, when Obama had enormous leverage over the Bush administration and then a dominant Democratic Party in Congress. In fact, during the transition itself, Bush’s Treasury Secretary Hank Paulson offered a deal to Barney Frank, to force banks to write down mortgages and stem foreclosures if Barney would speed up the release of TARP money. Paulson demanded, as a condition of the deal, that Obama sign off on it. Barney said fine, but to his surprise, the incoming president vetoed the deal. Yup, you heard that right — the Bush administration was willing to write down mortgages in response to Democratic pressure, but it was Obama who said no, we want a foreclosure crisis. And with Neil Barofsky’s book ”Bailout,” we see why. Tim Geithner said, in private meetings, that the foreclosure mitigation programs were not meant to mitigate foreclosures, but to spread out pain for the banks, the famous “foam the runway” comment. This central lie is key to the entire Obama economic strategy. It is not that Obama was stymied by Congress, or was up against a system, or faced a massive crisis, which led to the shape of the economy we see today. Rather, Obama had a handshake deal to help the middle class offered to him by Paulson, and Obama said no. He was not constrained by anything but his own policy instincts. And the reflation of corporate profits and financial assets and death of the middle class were the predictable results
But it makes sense once you realize that his policy architecture coheres with a Romney-like philosophy that there is one set of rules for the little people, and another for the important people. It’s why the administration quietly pushed Chinese investment in American infrastructure, seeks to privatize public education, removed labor protections from the FAA authorization bill, and inserted a provision into the stimulus bill ensuring AIG bonuses would be paid, and then lied about it to avoid blame. Wall Street speculator who rigged markets are simply smart and savvy businessmen, as Obama called Lloyd Blankfein and Jamie Dimon, whereas the millions who fell prey to their predatory lending schemes are irresponsible borrowers. And it’s why Obama is explicitly targeting entitlements, insurance programs for which Americans paid. Obama wants to preserve these programs for the “most vulnerable,” but that’s still a taking. Did not every American pay into Social Security and Medicare? ...
We must fight this thuggish political culture Bush popularized, and Obama solidified in place...
If there had been an actual full-scale financial meltdown in 2008 without a bailout, while it would have been bad, it probably would have given us a fighting chance of warding off planetary catastrophe and reorganizing our politics. Instead the oligarchs took control, because we weren’t willing to face them down when we needed to show courage. So now we have the worst of all worlds, an inevitably worse crisis and an even more authoritarian structure of governance.
5--Sinking Europe, sober look
Markit: - The Eurozone sank further into decline at the start of the fourth quarter, with the combined output of themanufacturing and service sectors dropping at the fastest rate since June 2009.
The Markit Eurozone PMI® Composite Output Index fell for a third successive month, down from 46.1 in September to 45.8 in October, according to the preliminary ‘flash’ reading based on around 85% of usual monthly replies. Output has fallen continually since September of last year with the exception of a marginal increase in January.
Output continued to fall in response to a further marked contraction in new orders. The rate of decline in new business eased slightly since September, which had seen the largest drop since June 2009...
Households surveys in the Eurozone paint a similarly bleak picture. The EC consumer confidence (which ticked up slightly), expectations for the economy, and particularly personal finances are all quite weak. In fact the expectation of "own financial situation in the next 12 months" touched the all-time low reached in 2008. Eurozone households have completely lost confidence in the sustainability of their personal finances going forward.
6---As Surge Ends, ‘Stalemate’ in Afghanistan Predicted, antiwar
7--As US and allies shift away from Afghan combat, some see stalemate even as Taliban weaken, WA Post
What began in October 2001 under the Pentagon’s hopeful banner of “Operation Enduring Freedom” has hardened into enduring resistance. The Taliban take heavy losses but regenerate as fast as they fall. They also maintain links to a range of other extremist groups, including al-Qaida and the Pakistan-based Haqqani network....
U.S. Defense Secretary Leon Panetta, who championed the additional American troops, remains optimistic.
“We’ve come too far, we’ve fought too many battles, we have spilled too much blood not to finish the job that we are all about,” Panetta said in Brussels this month after meeting with his counterparts from NATO nations.
The “job” Panetta referenced is no longer to defeat the Taliban before 2015 or to eradicate al-Qaida in its Afghan redoubts, but to create an Afghan security force that can at least hold the substantial gains achieved by the U.S.-led international alliance...
Some U.S. commanders express worry that no matter how much better the Afghan forces get before most Western forces go home in 2014, it could all be for naught if the Afghan government fails to strengthen its legitimacy in the eyes of ordinary Afghans.
Adding to a sense of unease is anger over a rising number of killings of U.S. and coalition troops by Afghan soldiers and police out of personal pique or in apparent sympathy with the Taliban. At least 57 coalition personnel, mostly Americans, have been killed so far this year in 40 “insider attacks.” The latest was Thursday, when two U.S. servicemen were killed by a gunman in an Afghan police uniform.
After a spurt of insider attacks in August and September, one of Congress’ most vocal advocates of pursuing the war, U.S. Sen. John McCain, R-Ariz., was so fed up that he called for a re-evaluation of the Obama administration’s troop withdrawal plan, saying it might need to be speeded up. He later said that was a bad option.
American public support for the war has dropped precipitously during Obama’s term in the White House.
A Pew Research Center poll in early October found that 60 percent of respondents favored removing U.S. troops from Afghanistan as soon as possible, with 35 percent saying they should stay until the country is stable. That’s a nearly complete reversal from a September 2008 Pew Research poll that showed 33 percent wanted troops out as soon as possible and 61 percent said they should stay until the country has stabilized.