Monday, February 4, 2019

Today's Links

1--Schumer and Sanders: Limit Corporate Stock Buybacks


Corporate self-indulgence has become an enormous problem for workers and for the long-term strength of the economy.

From the mid-20th century until the 1970s, American corporations shared a belief that they had a duty not only to their shareholders but to their workers, their communities and the country that created the economic conditions and legal protections for them to thrive. It created an extremely prosperous America for working people and the broad middle of the country. 

But over the past several decades, corporate boardrooms have become obsessed with maximizing only shareholder earnings to the detriment of workers and the long-term strength of their companies, helping to create the worst level of income inequality in decades.

One way in which this pervasive corporate ethos manifests itself is the explosion of stock buybacks.
So focused on shareholder value, companies, rather than investing in ways to make their businesses more resilient or their workers more productive, have been dedicating ever larger shares of their profits to dividends and corporate share repurchases. When a company purchases its own stock back, it reduces the number of publicly traded shares, boosting the value of the stock to the benefit of shareholders and corporate leadership.

Between 2008 and 2017, 466 of the S&P 500 companies spent around $4 trillion on stock buybacks, equal to 53 percent of profits. Another 30 percent of corporate profits went to dividends. When more than 80 percent of corporate profits go to buybacks and dividends, there is reason to be concerned.
This practice of corporate self-indulgence is not new, but it’s grown enormously. Fueled by the Trump tax cut, in 2018, United States corporations repurchased more than $1 trillion of their own stock, a staggering figure and the highest amount ever authorized in a single year.

This has become an enormous problem for workers and for the long-term strength of the economy for two main reasons.
First, stock buybacks don’t benefit the vast majority of Americans. That’s because large stockholders tend to be wealthier. Nearly 85 percent of all stocks owned by Americans belong to the wealthiest 10 percent of households. Of course, many corporate executives are compensated through stock-based pay. So when a company buys back its stock, boosting its value, the benefits go overwhelmingly to shareholders and executives, not workers.

Second, when corporations direct resources to buy back shares on this scale, they restrain their capacity to reinvest profits more meaningfully in the company in terms of R&D, equipment, higher wages, paid medical leave, retirement benefits and worker retraining.

It’s no coincidence that at the same time that corporate stock buybacks and dividends have reached record highs, the median wages of average workers have remained relatively stagnant. Far too many workers have watched corporate executives cash in on corporate stock buybacks while they get handed a pink slip.  ...

The past two years have been extremely disappointing for millions of workers. President Trump promised the typical American household a $4,000 pay raise as he pushed for his tax giveaway to the rich. The reality, however, is that from December 2017 to December 2018, real wages for average workers have gone up by just $9.11 a week. Sadly, average workers are making less today than they made in 1973 after adjusting for inflation, while stock buybacks have skyrocketed to record levels.

2--Neocon warmongers’: NBC slammed for drawing on dodgy Russiagate org in Gabbard smear


NBC’s claim Tulsi Gabbard is supported by a Kremlin propaganda effort is based on data from a cybersecurity firm already exposed for creating fake Russian bot accounts, prompting a sharp rebuke from Gabbard and mockery online.

The network published an article claiming “Russia’s propaganda machine” had discovered Gabbard, and said experts tracking Russian-linked social media saw “stirrings of a possible campaign of support.”

It has since been revealed by The Intercept that the NBC report relied on the claims of a discredited cybersecurity firm exposed in December as making up fake Russian bot accounts to create misleading stories about Russian influence.

Gabbard shared the Intercept’s article Sunday, saying NBC “used journalistic fraud” to discredit her campaign in order to “to smear any adversary of the establishment wing of the Democratic Party – whether on the left or the right – as a stooge or asset of the Kremlin.”

The NBC article cited the firm New Knowledge, which created fake Russian troll accounts on Facebook and Twitter in order to drum up false claims that the Kremlin was meddling in the Alabama Senate election to undermine Democrat Doug Jones and promote his rival, Republican Roy Moore. According to an internal report seen by the New York Times, the company boasted about such, saying it had created an elaborate ‘false flag’ operation

NBC’s claim Tulsi Gabbard is supported by a Kremlin propaganda effort is based on data from a cybersecurity firm already exposed for creating fake Russian bot accounts, prompting a sharp rebuke from Gabbard and mockery online.
The network published an article claiming “Russia’s propaganda machine” had discovered Gabbard, and said experts tracking Russian-linked social media saw “stirrings of a possible campaign of support.”

It has since been revealed by The Intercept that the NBC report relied on the claims of a discredited cybersecurity firm exposed in December as making up fake Russian bot accounts to create misleading stories about Russian influence.
Gabbard shared the Intercept’s article Sunday, saying NBC “used journalistic fraud” to discredit her campaign in order to “to smear any adversary of the establishment wing of the Democratic Party – whether on the left or the right – as a stooge or asset of the Kremlin.”

The NBC article cited the firm New Knowledge, which created fake Russian troll accounts on Facebook and Twitter in order to drum up false claims that the Kremlin was meddling in the Alabama Senate election to undermine Democrat Doug Jones and promote his rival, Republican Roy Moore. According to an internal report seen by the New York Times, the company boasted about such, saying it had created an elaborate ‘false flag’ operation.

New Knowledge CEO Jonathon Morgan created the false accounts and then used them to mislead both the public and the US national media.

The organization wrote a Senate Intelligence Committee report on Russian social media election interference. It created the Alliance for Securing Democracy’s Hamilton 68, a dashboard which claims to track Russian disinformation through monitoring social media accounts it says are linked to Russian disinformation and has been criticized for not being conclusive (by one of its own creators) and for not being transparent about its methodologies.

It also created a similar dashboard, Disinfo2018, which the NBC article referenced, claiming it had discovered that three of the top URLs shared by social media accounts deemed to be Russian propagandists were about Gabbard.

3--Something intelligent about the Northam affair


the Northam affair has served, at least for a few days, as a gigantic diversion. The Sunday television interview programs were largely devoted to the fate of this comparatively obscure state politician, whom not one in a hundred Americans outside the state of Virginia could even have identified.

No need to discuss such issues as the US repudiation of the Intermediate Nuclear Forces treaty—bringing forward the danger of nuclear war—or the Trump administration’s preparations to invade Venezuela, or Trump’s threats to declare a national emergency and assume quasi-dictatorial powers if he cannot browbeat Congress into approving a border wall, or the freezing death of workers and students in last week’s cold snap.

And with its images of blackface and the KKK, albeit 35 years old, the Northam affair provides yet another opportunity to portray race—along with gender, sexual orientation and other “identities”—as the fundamental dividing line in American society. Anything to avoid the most important dividing line: that between the ruling elite of billionaires and multi-millionaires and the vast majority of the population—the working class, which is now beginning to move in a class struggle increasingly directed against the capitalist system.

There is nothing to defend in Northam. However, there is something massively fraudulent in the political-media operation launched against him. If Northam is forced out, he will be replaced by someone else, no less right-wing and reactionary, in a ritualist purge that will have no effect on anything of significance, least of all the conditions that give rise to racism.

4--US issues new threats of war for oil against Venezuela


At its roots, Washington’s intensifying efforts at regime-change in Venezuela are part of a “pivot to Latin America” aimed at eradicating Chinese and Russian influence and transforming the whole Western Hemisphere into the exclusive cheap-labor and primary resource platform for US imperialism.....

As the Council on Foreign Relations’ O’Neil told the corporate conference call, “If it [sanctions] doesn’t work in dislodging this regime, then there’s not a lot left in the toolkit besides things like military intervention.”

A military intervention in Venezuela—population 30 million—could kill hundreds of thousands or millions of people and transform Latin America into an imperialist slaughterhouse.
The geopolitical intelligence think tank Stratfor recently noted, “A military intervention could quickly snowball into one of the largest worldwide military operations since the 2003 invasion of Iraq.”

Francisco Toro, a Washington Post columnist and anti-Maduro think tank analyst, told the Council on Foreign Relations gathering that a military intervention would lead to “a kind of Syrian civil war” and confrontation between nuclear-armed powers.

He said: “There is this definite threat that if a military operation takes any amount of time in Venezuela, that other countries then start to move in too. And you can imagine, easily, Brazil moving into the southeast, Colombia into the southwest. You can imagine Russia trying to defend its oil interests, because Russia has big oil investments in Venezuela. You can imagine China doing I don’t know what. And Cuba has already intelligence penetration into the Venezuelan armed forces.”

5--No deal reached at US-China trade meeting


Writing in the South China Morning Post this week, Regina Ip, the founder of the pro-Beijing People’s Party and a member of the Hong Kong Legislative Assembly, said the conflict with the US could not be blamed on China’s “state capitalism” or its national industrial policy. Beijing’s measures, she insisted, were not fundamentally different from those undertaken by Japan and South Korea after World War II.

“As is well documented by scholars on Japan’s post-war economic miracle, Japan adopted a deliberate strategy of market protection by erecting tariff and non-tariff barriers, grooming ‘national champions’ in selected industries, targeting US rivals and making copycat production by reverse engineering,” Ip wrote.

The same issue was raised by another commentator with a very different political outlook. Henry Ergas, a leading columnist for Rupert Murdoch’s flagship newspaper, the Australian, noted that China’s claim it was following the same road taken by the East Asian tigers in their growth phase was “not unreasonable.”

6--The Fed’s interest rate U-turn: Some economic and political conclusions (NB)

 

The decision by the US Federal Reserve on Wednesday to completely abandon its policy announced just six weeks ago to carry out two limited interest rate rises in 2019 has established one economic and political fact of life.
The financial elites, addicted to the supply of ultra-cheap money as they appropriate up the wealth produced by the labour of billions of workers in the US and around the world, dictate economic policy. Their motto is: Wall Street rules.

In announcing what the Financial Times called a “momentous U-turn,” one of the sharpest in recent memory, Fed chairman Jerome Powell cited slowing growth in China and Europe, rising trade tensions and the risk of a hard Brexit.

But all of these factors were apparent at the Fed’s meeting in December, when it lifted interest rates by 0.25 percentage points and foreshadowed two similar rises this year. The decision was even more extraordinary given that official unemployment levels in the US are at lows not experienced in almost 50 years and the Fed’s outlook was for a “strong” pace of economic growth in 2019....

the Fed said it was “prepared to adjust any of the details for completing balance sheet normalization in light of economic and financial developments.” It stated that would avoid “unnecessary market disruption” and was prepared to renew QE should that be required. In other words, total subservience to the markets....

Amid the deepening hostility to capitalism and growing interest in socialism, especially among young people, a highly orchestrated campaign has been launched by the Democratic Socialists of America, the pseudo-left Jacobin magazine and the New York Times, among others, to trap this movement within the framework of the Democratic Party.

The campaign centres on the newly-elected Congress member Alexandria Ocasio-Cortez, a member of the DSA, and her proposal to increase taxes on the wealthy to 70 percent, the level that prevailed in the 1960s and 1970s.

Ocasio-Cortez’s rhetoric over taxes is aimed at promoting the illusion that social inequality and the vast transfer of wealth up the income scale can be overcome by a “course correction.” The DSA claims this can be achieved within the framework of the present political order, without a frontal confrontation against the ruling financial elites and their political representatives in the Democratic and Republican parties.

That political fiction has surely been exposed by the latest Fed decision. If the financial markets cannot and will not countenance even a minor rise in interest rates, what would be their reaction to a 70 percent wealth tax?

7--Tulsi Gabbard--No intervention in Venezuela  


8--Senate Report on Russian Interference Was Written By Disinformation Warriors Behind Alabama ‘False Flag Operation’

 

9--Austerity, not xenophobia triggered Brexit

 

Welfare cuts and other austerity measures implemented under the Conservatives pushed vital swing voters to back Brexit and won the EU referendum for the Leave campaign, according to a new report.
Research published by the Social Market Foundation suggests the best indicator of a person’s referendum vote was not age or education, but happiness or sadness about their personal finances – with unhappy people tending to vote Leave and contented ones preferring Remain.

The report, which analysed the level of cuts in each area of the UK alongside each area’s growth in support for Ukip, argues that had it not been for austerity, the referendum would not have turned out the way it did.

It found that in districts that received the average austerity shock, Ukip vote shares were on average 11.62 percentage points higher in the most recent local elections prior to the referendum than in districts with little exposure to austerity.

“Households exposed to the bedroom tax increasingly shifted to support Ukip and experienced economic grievances as they fell behind with their rent payments due to the cuts,” the paper stated.
As much as 9 percentage points of the 52 per cent support for Leave – around 3 million votes – was decided by concern about austerity and related issues, the researchers estimated.
It suggests that without the effect of the “austerity shock” on welfare and public services, the Leave share of the referendum vote could have been as low as 43 per cent, delivering a comfortable win for Remain.

As well as area-level analysis, the report looked at individual-level data and found that some people directly affected by welfare cuts shifted their political support to Ukip and rejected the political establishment

 

Dr Thiemo Fetzer, report author and associate professor of economics at the University of Warwick, said: “The swing voters who decided the referendum result were not diehard Eurosceptics. They were concerned about public goods and public services and feeling the impact of austerity policies.

“If it hadn’t been for austerity, more of those marginal voters would have voted the other way and the referendum wouldn’t have turned out the way it did.”

Dr Fetzer added that the way politicians were handling the Brexit process showed they were “still ignoring” the concerns of the swing voters who decided the outcome of the referendum.
“The swing voters who backed Leave don’t want a no-deal Brexit but don’t want no Brexit either. They probably want some sort of deal that means Britain leaves the UK without more disruption to public services and resources,” he said.

The report also challenged the idea that age was the dominant factor in referendum voting behaviour, with analysis showing that only the 18- to 24-year-old demographic showed a strong majority for Remain.
“Brexit was not delivered only by old people; leaving was the majority choice for most age groups and only the very young were substantially pro-Remain,” the report stated.

“But right now, the political system is set up to focus on the extremes on either side, not on the marginal voters in the middle who actually made the difference between Leave and Remain.
“Marginal voters and the reasons they voted Leave are being dangerously ignored.”

10--Catastrophe Ahead


, two truly courageous leaders, U.S. President Ronald Reagan and Soviet Gen. Secretary Mikhail Gorbachev signed the first nuclear disarmament treaty on Dec. 8, 1987 with which the U.S. and the Soviet Union agreed to reduce the actual stockpile of their intermediate-range 500- to 5,500-kilometer nuclear missiles. Those were the missiles that the U.S. and NATO said were threatening Europe. For much of the West, the Intermediate-Range Nuclear Forces Treaty (INF Treaty) was a turning point of the Cold War, eliminating more than 2,600 missiles and ending the standoff with nuclear missiles in Europe. The mutual trust that the INF Treaty had built between the East and the West led the way to the Strategic Arms Reduction Treaty (START) four years later. With Start I, signed by U.S. President George Bush and Gorbachev, and START II, signed by Bush and then-Russian President Boris Yeltsin, strategic offensive arms were reduced and limited. 

Thus, one can safely say that from July 31, 1991 until last Friday, when the Donald Trump Administration announced that the U.S. would pull out of the nuclear arms control treaty with Russia, the whole world was a better place. Trump, by ending the INF agreement is now raising fears of a new nuclear arms race in Europe and Asia. Nobody is buying Trump's claim that Russia is violating the INF Treaty. People in the world know very well that by pulling out of the treaty the U.S. is going to build up its nuclear arsenal to strike China. When President Ronald Reagan stopped building 5,500-kilometer-range missiles 30 years ago, China was not on the list of those the U.S. considered a threat against its national security. In his first National Security Strategy document, Trump named China along with Iran, North Korea and Russia as "enemies of the U.S."

One of the cyclical depressions that global capitalism and the imperialistic world order created is approaching fast. Trump's efforts to rewind the global commercial and financial new world order worked a little but not as fast and comprehensive as the fat cats of U.S. imperialism would like. What is approaching is not one of those simple financial crises but a big one: the whole infrastructure of U.S. production and distribution systems could crumble. Those crumbling interstate highway bridges are simple symbols of the forthcoming shattering of the whole system. A year ago, in his State of the Union Address, Trump called out the nation's crumbling infrastructure and called for more spending on bridges and roads, but said, "Fret not America, it's not that bad."

Bridges and highway passes can be fixed by spending more on them; the jobs exported to the Far East can be brought back by offering more tax benefits, but the colossal capitalistic enterprise of China cannot be overcome by a simple provocation of Uyghur Turks. Trump needs more than that. He needs a war for which he can start building up missiles

11--Trump's Syria plan is doomed to fail without Turkey

In the absence of an agreement with Turkey, a hasty U.S. withdrawal from Syria won't solve any problems but rather fuel the present conflicts in the country

 

A political tug-of-war over a proposed "safe zone" in northern Syria is underway in Washington. Critics of U.S. President Donald Trump's decision to withdraw American forces from the conflict zone are working hard to stop the administration from working with Turkey in the future. Syria experts at various Washington think tanks challenge the Turkish view in order to persuade the United States to keep protecting the People's Protection Units (YPG) militia – which is part of the PKK terrorist organization.

Senior Pentagon officials share that view and are attempting to transform Trump's safe zone, which was intended to address Turkey's national security concerns, into a buffer zone designed to shelter YPG militants from Turkish retaliation. Nowadays, the U.S. military leadership is lobbying for three options: To surrender the YPG-controlled territory to Russia and the Assad regime, to let Arab fighters from the Syrian Democratic Forces (SDF) take charge, and to hand it over to a joint European force.

The U.S. State Department, by contrast, supports the plan to cooperate with Turkey....

Washington tends to repeat the mistake of failing to understand the balance of power in the countries and region, which set the stage for U.S. military interventions, without worrying about the problems that its arrogance tends to cause in the long run. The exclusion of Sunni Arabs, which the U.S. tolerated to dismantle the Baath regime in Iraq, had nothing to do with democracy. Instead, that decision pushed the Sunni community to radical groups including al-Qaida and Daesh.
It is no secret that Washington's flawed approach won't produce workable solutions. In Afghanistan, where the Americans made the same exact mistake, the Taliban is set to claim the driver's seat under a negotiated settlement with the United States. Let us hope that the relevant government agency will publish a report claiming that democracy promotion in Afghanistan was a mistake.

With the U.S. withdrawal from Syria around the corner, America's foreign policy elite is about to make their next big mistake. To be clear, the current debate isn't about Trump's decision to leave the conflict zone at all. Instead, it relates to the nature of the retreat. It is still possible for the United States to pull out of the battlefield by repairing its strained relations with Turkey and making a meaningful contribution to Syria's future. The only way to accomplish that goal is to cooperate with the Turks
In the absence of an agreement with Turkey, a hasty U.S. withdrawal from Syria won't solve any problems. Nor can Washington get anywhere by exploring other options that seek to exclude Ankara, as such moves will play into the hands of Russia, Iran and the Assad regime. To make matters worse, going down that path will rule out the reversal of the damage that the Syrian crisis inflicted on Turkey-U.S. relations.
Make no mistake: One way or another, Turkey will find middle ground with Russia and Iran. Yet the Turks will consider the United States a hostile power if it packs its bags and goes home after it armed the PKK's Syrian affiliate and created a buffer zone to protect terrorists.
 

12--Astana group works on Syria charter body's final touches

 

The Syrian regime proposed a list of names for the committee of experts and civil society, to which opposition groups and Turkey objected because the list contained many regime-affiliated figures. Speaking in an interview with Hürriyet Daily News last week, Foreign Minister Mevlüt Çavuşoğlu said that even the regime’s deputy minister and Syria’s central bank chair were on the list, who he said cannot be considered as civil society representatives.

 
Following a decision by the U.S. to pull out its soldiers from northwestern Syria, Washington brought forward a proposal of a secure zone with the cooperation of Turkey.
A delegation headed by President Recep Tayyip Erdoğan had meetings in Moscow in late January.
 
 
The talks focused on the possible safe zone in northern Syria and making progress to realize the remaining steps of the Idlib deal. The Turkish side has been making plans to deploy Turkish troops in a zone which goes 55-60 kilometers into Syria. But the Russian side prefers the Turkish troops enter no more than 15-20 km. The parties decided to keep on working, with Turkish and Russian security officials and a delegation visiting Moscow in this regard.
Ankara is in efforts to dissolve Hay’at Tahrir al-Sham (HTS) in Idlib, trying to convince small groups, relatively moderate ones, to disintegrate from the jihadist body, which controls most of the rebel stronghold. Against this backdrop, Turkey also wants to prevent a military offensive by the regime into the enclave.
 


 

 


 


 









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