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We're Not 'All in This Together' Mr. Obama, and We Don't Want Obamacare

October 17, 2013 in Economics

By Roger Pilon

Roger Pilon

The latest federal government shutdown and debt default battles may be over for the moment, but the basic underlying issue of out-of-control deficits and debt remains unaddressed. The media have treated us instead to tales of suffering federal workers and closed national parks, thinking perhaps that we could handle nothing deeper.

Occasionally, however, a slightly more probing piece has appeared over this stretch, as with Tuesday’s New York Times “Opinionator” column by Michael P. Lynch, “Democracy After the Shutdown.” Alarmed by Forbes Opinions editor John Tamny’s piece a fortnight earlier, which at that stage urged Republicans to take credit for the shutdown, Lynch saw in Tamny’s article “the recent emergence of a political philosophy that threatens to unravel our joint commitment to a common democratic enterprise.” Actually, the “political philosophy” Tamny invoked is hardly recent. The anti-federalists articulated it thoroughly. And the federalists, writing also in New York’s newspapers of the day, were only marginally more committed to “a common democratic enterprise.”

We’re in this deficit and debt mess today because we’ve essentially abandoned the idea of constitutionally limited government.”

But for Lynch, Tamny’s piece brought things to a head, prompting him to write that we are living “in a dangerous political moment.” What’s the point of the Republican Party, Tamny mischievously asked, “if it’s not regularly shutting down the federal government?” As the “‘responsible stewards of the people’s money,’ shutdown should be a part of the GOP’s readily unsheathed arsenal of weapons meant to always be shrinking the size and scope of our economy-asphyxiating federal government.”

That’s the kind of talk that drives liberals like Lynch and his Times audience up a wall, of course, because it’s not just “’crazy talk’ and unserious bluster,” he writes, but represents “views now being entertained on the radical right, not just in the dark corners of the Internet, but in the sunlight of mainstream forums.” He calls, therefore, for confronting it “by asking a simple question: What are the consequences of this strategy — one that urges us to explicitly pull out of a shared contract of governance?”

Not surprisingly, that “shared contract of governance” carries a lot of weight thereafter in Lynch’s argument — alas, more than it can bear. Thus, the first of his two main concerns is for “the social contract itself,” which “develops out of the idea that if we act as a body, and put aside some …read more

Source: OP-EDS

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Robert Reich: What to Expect During the Cease-Fire

October 17, 2013 in Blogs

By Robert Reich, RobertReich.org

Unfortunately, extremists, threats and possible shutdowns are still very much with us.


 

The war isn’t over. It’s only a cease-fire. 

Republicans have agreed to fund the federal government through January 15 and extend the government’s ability to borrow (raise the debt ceiling) through Feb. 7. The two sides have committed themselves to negotiate a long-term budget plan by mid-December. 

Regardless of what happens in the upcoming budget negotiations, it seems doubtful House Republicans will try to prevent the debt ceiling from being raised next February. Saner heads in the GOP will be able to point to the debacle Tea Partiers created this time around – the public’s anger, directed mostly at Republicans; upset among business leaders and Wall Street executives, who bankroll much of the GOP; and the sharply negative reaction of stock and bond markets, where the American middle class parks whatever savings it has.

The saner Republicans will also be able to point out that President Obama means it when he says he won’t ever negotiate over the debt ceiling. The fact that he negotiated over it in 2011 is now irrelevant.

On the other hand, there’s a significant chance of another government shutdown in January. By then we’ll be well into the gravitational pull of the 2014 midterm elections. Every House member is up for reelection – mostly from safe (often gerrymandered) districts in which their major competitors are likely to be primary opponents from the Tea Party right.

These opponents will be challenging them to show what they’ve done to sandbag Obamacare and shrink the size of government. The President and the Democrats have made it clear they’ll protect Obamacare at all costs. Which means the real action between now and January 15 will be over the federal budget. The threat of another government shutdown is the only major bargaining leverage House Republicans possess in order to get what they consider “meaningful” concessions.

We know the parameters of the upcoming budget debate because we’ve been there before. The House already has its version — the budget Paul Ryan bequeathed to them. This includes major cuts in Medicare (turning it into a …read more

Source: ALTERNET

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Tea Partiers V. Millennials: Why the Far Right Disdains Young People, Even Their Own Kids

October 17, 2013 in Blogs

By Josh Eidelson, Salon

Sociologist Theda Skocpol explains what drives the angry right, and what to expect next from them.


 

The past weeks’ showdown in Washington, D.C., has shocked and perplexed some observers. Theda Skocpol was not among them. Skocpol, a veteran Harvard professor, is the author of books on topics ranging from the politics of the U.S. welfare state (Protecting Soldiers and Mothers) to the state of grassroots political engagement (Diminished Democracy), and of the definitive social science tome on the Tea Party (The Tea Party and the Remaking of Republican Conservatism, with Vanessa Williamson).

With the immediate debt ceiling/shutdown showdown coming to a close, Salon called up Skocpol Wednesday to discuss how the media misunderstand the Tea Party, how an unpopular movement can move so many members of Congress, and why the right hates Obama’s moderate healthcare law so much. What follows is an edited and condensed version of our conversation.

Has this month shown us anything we didn’t know about the Tea Party?

I think people in mainstream media and D.C. politics kind of wrote the Tea Party off after 2012. They thought, “Well, this isn’t popular anymore, and the Democrats succeeded in defeating the primary goal of Tea Party forces.” But I think that was always misreading what the Tea Party was about. It’s been there all along to keep Republicans from compromising. I think we’ve seen over the past two weeks that they have the ability to just tie up the federal government and put the country at risk, and they don’t show any signs of backing down. And I don’t think they will, even if they’re defeated in this episode.

Frances Fox Piven argued to me that the Tea Party is something old and something new – it has some demographic continuity with the Birchers or Christian Right, but also represents a genuine shift motivated in part by fear that white people are losing their privilege in the U.S. Do you agree?

In many ways I do. We actually did the research, both by pulling together national [data] and by doing observations in groups in three regions. There’s no question that at …read more

Source: ALTERNET

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Beer Offensive: The Koch Brothers Try to Bribe College Students Not to Sign Up for Obamacare with Brewskies

October 17, 2013 in Blogs

By Sadhbh Walshe, The Guardian

Oddly, it doesn't seem to be working.


What's a family values conservative to do when every effort to protect millions of Americans from the scourge of affordable healthcare fails?

Break out the beer, of course. The latest campaign to kill off Obamacare in its infancy is now playing out on college campuses where a conservative group known as Generation Opportunity (GO), who are funded in part by the billionaire Koch brothers, is using the lure of free beer and “opt out” beer koozies to persuade young students not to buy health insurance – or, at least, not to buy it from the Obamacare exchanges.

Traditionally, one might expect God-fearing conservatives to be warning youth about the dangers of alcohol consumption, rather than plying them with free liquor, but these are desperate times. The determined Koch brothers have already spent hundreds of millions of dollars trying to derail the president's healthcare law. So far, though, despite their best efforts, Obamacare has proved as “invincible” as the young people it needs to enroll. While it's unlikely that the beer exchanges, shall we call them, will be the game-changer, the Kochs may well end up driving many of us to drink with their relentless and futile vendetta to undo the law – not just the college students.

Nearly every movement to “educate the public” about the “dangers” of Obamacare can be linked in some way to the Koch brothers, and this latest college campus effort is no different. Last month, Politico revealedthat GO has received $5.04m from the Koch-funded entity known as Freedom Works. This “grassroots” movement is now about to embark on an “Opt Out” tour of 20 college towns across the country as part of its effort to steer young people away from the Obamacare exchanges. As GO's 29-year-old president, Evan Feinberg, put it:

What we're trying to communicate is, 'No, you're not actually required to buy health insurance' … you might have to pay a fine, but that's going to be cheaper for you, and better for you.

After coming under …read more

Source: ALTERNET

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Starting Tonight at Mises Academy: ‘Basics of Economics: Action and Exchange’

October 17, 2013 in Economics

By Mises Updates

Starting tonight at Mises Academy:

Basics of Economics: Action and Exchange

Robert Murphy writes:

I am pleased to announce that on October 17, we will begin a six-week Mises Academy course that offers an introduction to the Austrian understanding of action and barter exchange. This course, titled “Action and Exchange,” is the first of a three-part series that uses my Lessons for the Young Economist as the main textbook. Previously at Mises Academy I have offered a course titled “Principles of Economics” that covered just the highlights of Lessons.

In this new series, we will go through the material much more methodically, covering everything from the textbook, as well as including supplemental discussion from the broader Austrian tradition.

…read more

Source: MISES INSTITUTE

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The Shutdown in Perspective: Spying on Americans Continued; Services for Needy Children Did Not

October 17, 2013 in Blogs

By Mattea Kramer, Jo Comerford, Tom Dispatch

“Essential” is a relative term.


 

To stay on top of important articles like these, sign up to receive the latest updates from TomDispatch.com   here.

On a damp Friday morning 11 days into the government shutdown, a “few dozen” truckers took to the Capital Beltway in a demonstration with the Twitter hashtag #T2SDA (Truckers to Shut Down America).  They wanted to tell lawmakers they were angry, launch an impeachment campaign against the president, and pressure Congress to end itself.

They were on a “ride for the Constitution,” protesting big government and yet the opinion polls were clear. In fact, the numbers were stunning. One after another, they showed that Americans opposed the shutdown and were hurting because of it.  At that moment, according to those polls, nearly one in three Americans said they felt personally affected not by too much government, but by too little, by the sudden freeze in critical services.

In reality, that government shutdown was partial and selective. Paychecks, for example, kept flowing to the very lawmakers who most fervently supported it, while the plush congressional gym with its heated pool, paddleball courts, and flat-screen televisions remained open. That’s because “essential” services continued, even as “nonessential” ones ceased. And it turned out that whether the services you cared about were essential or not was a matter of just who got to do the defining. In that distinction between what was necessary and what wasn’t, it was easy enough to spot the values of the people’s representatives. And what we saw was gut-wrenching. Stomach-churning.

Prioritized above all else were, of course, “national security” activities, deemed beyond essential under the banner of “protecting life and property.” Surveillance at the National Security Agency, for instance, continued, uninterrupted, though it was liberated from its obviously nonessential and, even in the best-funded of times, minimal responsibility to disclose those activities under the Freedom of Information Act.  Such disclosure was judged superfluous in a shutdown era, while spying on Americans (not to speak ofBraziliansMexicansEuropeansIndians, and others around the planet) was deemed indispensible.

Then there was the …read more

Source: ALTERNET

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The Real Problem Isn't Janet Yellen, It's the Conceit That Is the Fed Itself

October 17, 2013 in Economics

By James A. Dorn

James A. Dorn

When President Barack Obama nominated Federal Reserve vice chairman Janet Yellen to take over as Fed chairman after Ben Bernanke departs in January, the markets purred a sigh of relief. The Fed’s adherence to ultra-low interest rates and quantitative easing to boost risk taking and asset prices is now expected to continue for at least another year and most likely until the end of 2015. That path could prove costly.

The Fed’s balance sheet already has soared from $800 billion in 2008 to $3.7 trillion today. Continuing to accumulate $45 billion of longer-term Treasuries and $40 billion of mortgage-backed securities per month will further inflate the monetary base and risk igniting inflation.

President Obama, in his nominating speech, noted that “a lot of people aren’t necessarily sure what the Federal Reserve does.” He then went on to say that because of Bernanke’s unconventional monetary policies “more families are able to afford their own homes, [and] more small businesses are able to get loans to expand and hire workers.” Apparently the president accepts the idea that printing money, and artificially lowering interest rates, is good for America.

Without a rule to bind the Fed and without a convertible currency, the risk of monetary mischief is high and will be even higher if Yellen is appointed chairman.”

The truth is that many families are still constrained by the loss of equity suffered during the 2008 financial crisis and cannot make the high down payments now required for most home mortgages. Moreover, banks are reluctant to lend to small, higher-risk businesses, and job growth has been painfully slow.

The Fed’s dual mandate, imposed in 1977, requires maximum employment and price stability, but the reality is that there are limits to monetary policy. Printing money cannot increase the wealth of a nation. Moreover, there can be no permanent tradeoff between inflation and unemployment. Market participants learn to adjust to monetary policy. Once workers anticipate inflation, they will demand higher wages and unemployment will revert to its “natural” level consistent with market demand and supply.

Increasing real economic growth requires improved technology, capital investment, a better educated workforce, and institutions that are conducive to entrepreneurship and prudent risk taking. Those institutions include a just rule of law that protects persons and property, free trade, sound money, limited government, low marginal tax rates, and market-friendly regulation.

Although printing more money cannot increase society’s productive capacity or …read more

Source: OP-EDS

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France 24: Chinese agency downgrades US credit rating

October 17, 2013 in Politics & Elections

A Chinese ratings agency downgraded its US sovereign credit rating Thursday despite Washington’s resolution of the debt ceiling deadlock, warning that fundamentals for a potential default remained ‘unchanged’.
Dagong lowered its ratings for US local and foreign currency credit from A to A-, maintaining a negative outlook, the agency said in a statement.
The announcement came after the US Congress passed and President Barack Obama signed a bill that extends the nation’s borrowing authority and ends a two-week government shutdown.
‘The fundamental situation that the debt growth rate significantly outpaces that of fiscal income and gross domestic product remains unchanged,’ Dagong said in the statement, adding Washington’s solvency was vulnerable as old debts were still repaid through raising new debts.
‘Hence the government is still approaching the verge of default crisis, a situation that cannot be substantially alleviated in the foreseeable future,’ it said.
Dagong made headlines in August 2011 when it lowered its main rating for US sovereign debt after Congress passed an earlier bill to raise Washington’s debt ceiling.
The agency, which is far less prominent than long-established Western competitors including Moody’s, Fitch and Standard and Poor’s, has been working to further raise its profile.
China’s official news agency Xinhua said Thursday in a bylined commentary that US politicians had held the rest of the world hostage in the crisis.
But Beijing welcomed the agreement, saying it will contribute to global economic stability.

Read more from France24 HERE. …read more

Source: RAND PAUL

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The Militarization of America’s Police Forces

October 17, 2013 in Economics

The last days of colonialism taught America’s revolutionaries that soldiers in the streets bring conflict and tyranny. As a result, our country has generally worked to keep the military out of law enforcement. But according to Cato scholar Radley Balko, over the last several decades, America’s cops have increasingly come to resemble ground troops. The consequences have been dire: the home is no longer a place of sanctuary, the Fourth Amendment has been gutted, and police today have been conditioned to see the citizens they serve as an other—an enemy.

…read more

Source: CATO HEADLINES

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Has the IMF Outlived Its Usefulness?

October 17, 2013 in Economics

By Dalibor Rohac

Dalibor Rohac

In the weeks leading to the Annual Meetings of the International Monetary Fund (IMF) and the World Bank last weekend, Christine Lagarde, the managing director of the Fund, has been making a lot of headlines. She announced that the IMF would push for more gender equality in labour markets around the world, suggested that the IMF could help protect the planet from environmental damage by promoting reforms of energy subsidies, and urged European countries to move towards a fiscal union in order to help eurozone limit the severity of future financial crises.

That is a lot of ground to cover. While each of these proposals should be discussed on its own merit, jointly they are symptomatic of the spectacular mission creep that characterises the past 40 years of the organisation’s existence.

The original purpose of the IMF was relatively narrow — to assist in the post-war reconstruction of the international system of fixed exchange rates agreed on at the Bretton Woods conference in 1944. Specifically, the IMF was to provide a pool of liquidity for countries suffering from temporary payment imbalances.

The Bretton Woods system ceased to exist in the early 1970s. Since then, the IMF has tried to reinvent itself as an organisation doing everything from fostering global monetary co-operation, trade, high employment and growth, to poverty reduction around the world. Alas, the evidence that it has made a difference is rather thin.

Some economies standing at important economic and political crossroads — like Egypt — have chosen to simply ignore IMF’s advice and not to tap to its sources of liquidity. Since the events of the Arab Spring, the talks about an IMF loan have led nowhere; similarly, the country is making very little progress on the reform of its unsustainable system of subsidies — in spite of the subsidy reform initiative spearheaded by the Fund worldwide.

Even those countries that have navigated their way through these turbulent economic years have done so with very little help from the IMF. The Baltic countries, which had been hit the hardest by the financial crisis, received no IMF funding other than a small loan for Latvia, worth €1.16bn, which the government repaid ahead of schedule. The reason these economies got out of their troubles quickly was that their governments pursued bold economic reforms, including massive cuts to public spending and wholesale liberalisation of the economy. In 2009 alone, the fiscal adjustment …read more

Source: OP-EDS