Subscribe to Dollars & Sense magazine. Recent articles related to the financial crisis. What's behind the assault on BasraNaftana ('Our Oil' in Arabic) is an independent UK-based committee supporting democratic trade unionism in Iraq. It works in solidarity with the Iraqi Federation of Oil Unions (IFOU). It strives to publicize the union's struggle for Iraqi social and economic rights and its stand against the privatization of Iraqi oil demanded by the occupying powers. For more information see the IFOU's website.Dollars & Sense has covered the IFOU, most recently in David Bacon's feature article, Iraqi Workers Strike to Keep their Oil. About the current assault on Basra, David Bacon told D&S: "It is very important to let people in this country understand that under the accusations about the 'militias' is an effort by the Iraqi government and the US to consolidate control over the oil and ports, and eliminate those parts of the political opposition that have successfully opposed them." Here is the press release Naftana distributed to the media in Britain, in full: Basra Assault Confirms Presence of British Forces a Threat to Political and Trade Union Rights in Iraq Privatization is only part of the story; as David Bacon emphasizes, control over the oil industry is also a central aim of US and British interests. Greg Palast made this point in his interview with D&S back in May of last year: Dollars & Sense: Many progressives are focused on privatization of the Iraqi economy, including its oil industry, as Bush's real goal for the invasion. But you write about two radically different plans within the administration, the neo-cons' versus Big Oil's—and Big Oil's plan was the one opposed to privatization. What's going on here? Labels: Basra, David Bacon, IFOU, Iraq, Iraqi Federation of Oil Unions, Naftana Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). The JobThis satirical short (The Job) was created by Screaming Frog Productions.Labels: capitalism, day laborers, immigration, The Job Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). New Report: Nation's Gentrified Neighborhoods Threatened By AristocratizationThis new report reminds us yet again why it is so important to follow the independent press. You never get ground truth like this in the mainstream media.Read the whole thing at The Onion. Photo credit: © Copyright 2008, Onion, Inc. Labels: affordable housing, aristocratization, economic class, gentrification, satire, urban life Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). Clinton's Bigger Lies“Don’t worry, it’s cost plus,” was a saying made famous in Baghdad’s Green Zone, but the deluxe war spending was pioneered in the Clinton era.  While there is still some attention to Hillary Clinton’s role in the 1990s US foreign policy in the Balkans, I think we ought to be discussing untruths much more significant than her fib about landing in Bosnia under sniper fire. Clinton deserves the negative attention she is getting for her fabrication, but other lies, like the ones about her track record on economic policy, are what need ongoing scrutiny.
So let’s go back to some other statements of Hillary Clinton and to some other features of the US military presence in the Balkans. Last year, earlier on in her campaign, Clinton said
As she reflects back on the US military presence in the Balkans under her husband’s administration, and on her role in forming and carrying out his policies, Hillary Clinton needs to speak about the Bill Clinton administration’s “practice of hiring private companies to perform government functions.” In her book The Shock Doctrine, Naomi Klein observes that Halliburton, with Dick Cheney at the helm, made its first major expansions in the area of privatizing government functions in the Balkans—under Bill Clinton.
Under the Clinton administration, we also saw the privatization of information technology divisions of the US government.
And whom do we find on the board of Lockheed Martin during this period?
So, yeah, I’m concerned about the “practice of hiring private companies to perform government functions”—concerned that new private corporate inroads into government functions were pioneered under Bill Clinton and expanded wildly under George Bush. I am concerned that the corporate takeover will not be reversed unless there is a formal plan to accomplish this reversal. As far as I can see, neither Hillary Clinton nor Barack Obama has such a plan. In his Blueprint for Change, Obama champions the return of appropriate government regulatory functions, from the Labor Relations Board to the Department of Justice, but he sidesteps the new roles of private corporations in government function. Hillary Clinton, on the other hand, has claimed to be a standard bearer for the fight against these destructive economic policies, and it is nothing but a cynical lie. If Hillary Clinton is going to continue to stake claims on her husband’s presidential legacy, then we should be concerned that she may be as friendly to Dick Cheney’s economic vision as George Bush is. (Cross-posted on Hungry Blues.) Labels: bill clinton, bosnia, dick cheney, george bush, halliburton, hillary clinton, lockheed martin, lynne cheney, NAFTA, Naomi Klein, Shock Doctrine Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). Cockburn on Spitzer, Wall Street, and UFEAlexander Cockburn's column in the March 31st issue of The Nation (alas, not the most recent issue—some magazines are much more timely than D&S) argues that former New York governor Eliot Spitzer's downfall was due partly to the fact that he frightened Wall Street. "There were plenty of powerful financial institutions that craved his downfall and whose employees cheered wildly when it happened." Cockburn goes on:A little perspective is useful here. We are now well advanced in an election year where the prime candidates, Barack Obama, Hillary Clinton and John McCain, have scarcely made a centerpiece of their campaigns the outrageous and racist thievery practiced by Wall Street in the subprime scandals. A lawsuit filed by the NAACP on March 7 makes for instructive reading in this regard. It seeks to fast-track the NAACP's class-action lawsuit against Washington Mutual, Citi, GMAC and fifteen other mortgage firms that steered African-American borrowers into predatory loans.And here Cockburn cites a report by our neighbors and comrades, United for a Fair Economy: The suit cites a 2008 study by United for a Fair Economy estimating losses of $164-$213 billion for subprime loans during the past eight years. UFE considers this to be "the greatest loss of wealth for people of color in modern US history."(We were happy to be able to provide technical support for UFE's report, with the help of D&S collective member Bryan Snyder and Prof. Irvin Morgan of Bentley College.) Cockburn goes on to point out that whereas the federal government, including the SEC, has no prosecutorial powers with respect to subprime powers, this was not the case for New York State, whose Martin Act is: the most powerful criminal enforcement weapon in the country and one used to great effect by Spitzer when he was Attorney General. In January there were news stories about AG Andrew Cuomo using Martin to go after the subprime corporate miscreants. Such an onslaught, with the backing of Governor Spitzer, was undoubtedly making Wall Street nervous. Now Spitzer is gone. Wall Street has nothing to fear from Clinton or from Obama, whose candidac[ies] float on vast contributions from Wall Street, as detailed by Pam Martens in Counterpunch. Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). CEPR Paper Responds to Foreign Affairs on VenezuelaCEPR Paper Responds to Foreign Affairs on Venezuelaby Mark Weisberg Center for Economic and Policy Research March 21, 2008 Washington, D.C. A new paper from the Center for Economic and Policy Research responds to a recent article by Francisco Rodriguez in the March/April 2008 issue of Foreign Affairs that argued that Venezuela's poor have not benefited from the government of President Hugo Chavez. "In the five years since the Venezuelan government has gotten control over its national oil company, the economy (real GDP) has grown more than 87 percent, poverty has been cut in half, and unemployment by more than half," said Mark Weisbrot, CEPR Co-Director and author of the paper, "An Empty Research Agenda: The Creation of Myths About Contemporary Venezuela." "Real social spending per person has increased by more than 300 percent, and the government has expanded access to health care, subsidized food, and education. Under these conditions, it would indeed be remarkable if the living standards of the poor had not improved substantially," he added. The paper looks at various claims in the Foreign Affairs article by Francisco Rodriguez: Rodriguez claims that inequality, as measured by the Gini coefficient has worsened during the Chavez years. This is wrong. The only consistent measure of the Gini coefficient shows a substantial decline from 48.7 in 1998, or alternatively from 48.1 in 2003, to 42 in 2007. For a rough idea of the size of this reduction in inequality, compare this to a similar movement in the other direction: from 1980-2005, the Gini coefficient for the United States went from 40.3 to 46.9, a period in which there was an enormous (upward) redistribution of income. Read more... Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). Signed, Sealed, Delivered: It's a RecessionOur latest web-only article, this one by John Miller, D&S collective member and professor of economics at Wheaton College. It is posted here, accessible via the newly-delineated "Special to the Web" section of the home page (but it is short enough that we thought we'd post it on the blog also). Also check out the first and second installments in D&S collective member Larry Peterson's series of web-only articles on the subprime/securitization panic.No ifs ands or buts about it, the U.S. economy is in a recession. In February the economy lost 63,000 jobs, after losing 22,000 jobs the month before. A recession has never failed to follow two consecutive months of jobs loss. And not just construction jobs were lost—manufacturing and retail jobs disappeared as well. Investment houses—Goldman Sachs, JPMorgan Chase, Lehman Brothers, and Morgan Stanley—and Warren Buffet, the sage of Omaha and the world's most successful investor, have already declared the economy in a recession. When the Business Cycle Dating Committee of the National Bureau of Economic Research (NBER), the private research organization designated by the Commerce Department as the nation's arbiter of the business cycle, meets this summer, they too will undoubtedly find that a recession began either in the last months of 2007 or the beginning of 2008. By that time the economy would have contracted for two straight quarters, fulfilling the shorthand definition of a recession. Still, the NBER Dating Committee will examine a wide variety of data and ascertain that there has been "significant decline in economic activity spread across the economy, lasting more than a few months"—their official definition of a recession. The mortgage crisis continues to be the epicenter of the tremors spreading across the economy. A record high 7.9% of all loans are past due or in foreclosure. In addition, housing prices continue to drop, down 8.9% in the fourth quarter of 2007 from a year earlier, the largest drop in the 20 years of data collected by the S&P/Case-Shiller national home-price index. Falling housing prices have left more and more borrowers with houses worth less than their mortgage. A Goldman Sachs/Morgan Stanley report projects that if home prices fall 15%, as they expect, some 21% or borrowers, or 10.5 million households, will be stuck with negative equity. It is not just homeowners who are under water. The Fed as well is unable to right the insolvency problems of the economy. Despite the Fed having cut short-term interest rates by 2.25 percentage points [and another .75 on March 18th], long-term interest rates remain stubbornly high. With mortgage companies out to recoup their losses and reluctant to lend, and few willing to buy the mortgage or other long-term securities—including banks reluctant to lend even to other banks—the Fed seems to have little hope of getting the economy going. On top of that, inflation rates are picking up, with the price of oil at record levels, and food prices and the price of imports rising quickly. In January alone the price of imported goods from China increased 0.8% as the value of the dollar fell. Hard times are upon us. Debt-deflation threatens not just the value of homes but other assets as well. Inflation drives up the prices of household staples. Job losses mount. And Fed policy has proven ineffectual. Now is surely the time to bring the speculative economy under control, to put people to work at green jobs, and to remedy the lack of affordable housing through a massive building program that would free low-income families from the grip of predatory lenders. Labels: debt-deflation, Goldman Sachs, John Miller, JP Morgan Chase, Lehman Brothers, Morgan Stanley, mortgage meltdown, NBER, recession, The Fed, unemployment, Warren Buffet Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). D&S at the Left Forum As we do every year, D&S will be sharing an exhibit table with the Union for Radical Political Economics (URPE) at the Left Forum, Friday March 14th through Sunday March 16th in New York City. If you're going to the Left Forum, stop by our table! We'll be selling D&S books and subscriptions at a discount. Here is how the brochure describes this year's Forum: Each spring in New York City, Left Forum gathers intellectuals and activists from around the world to address the burning issues of our times. The theme for 2008 is "CRACKS IN THE EDIFICE". We will examine the context of an empire in the throes of collapse and discuss the possibilities for social movements to build a better world in its place. Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). Conference: "Think BIG" to End Poverty and Hunger in the U.S.This weekend (March 7-9) in Boston, the U.S. Basic Income Guarantee Network is holding a conference of economists and other experts in conjunction with the Eastern Economics Association annual meeting, whose purpose is to "urge the U.S. government to provide each American with a Basic Income Guarantee to meet fundamental human needs.""We reject the idea that 'the poor shall always be with us,'" said Karl Widerquist, a USBIG network coordinator. "It's time to think BIG: a basic income guarantee can provide Social Security for all ages, not just those over 65." According to the Network, "A basic income guarantee (BIG) is a government program to ensure every citizen's basic economic security. All Americans would receive, without means test or work requirement, an income sufficient for food, shelter, and basic necessities. The plan would incorporate elements of the most successful anti-poverty programs such as the Earned Income Tax Credit and the Child Tax credit." The issue is now garnering government attention. The first-ever Basic Income Guarantee bill--dubbed "The Tax Cut for the Rest of Us Act"--was introduced in the House of Representatives in 2006 by Congressman Bob Filner (D-CA). The bill would grant tax breaks to virtually everyone making less than $75,000 by transforming the standard income tax deduction into a standard tax credit of $2,000 per adult and $1,000 per child. The conference will be held at the Boston Park Plaza Hotel, 50 Park Plaza, Boston. Featured speakers include Philippe Van Parijs of Harvard University, Eduardo Suplicy, an economist currently serving his third term representing the state of São Paolo in the Brazilian Senate, and Sean Healy and Brigid Reynolds, co-directors of the Justice Commission of the Council of the Religious of Ireland. For more information on the event and the USBIG Network, click here. Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). D&S Author Bill Black in the News (Again)Bill Black, who wrote our November/December cover story— (Mis)Understanding a Banking Industry in Transition—is in the news again. An earlier posting (McCain in Bed with Lobbyists; Taxpayers Get Screwed) pointed out that Black was quoted in the New York Times article about McCain's dealings with lobbyists that created such a fuss. Now Black is a key source for a recent Boston Globe story on McCain's role in the S&L crisis as one of the Keating Five:Amid McCain's new status, old scandals stir  Black's feature article for D&S puts the current banking crises in the context of the history of banking deregulation and fraud that also led to the S&L crisis. A longer version of the article—giving a more comprehensive recent history of the banking industry in the United States—can be found in our brand new book Real World Banking and Finance, now available through our online bookstore. Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). The Squeezing of the Middle ClassHarvard Law School professor Elizabeth Warren discusses the economic pressures confronting the two-income middle-class family as it struggles to pay mortgages, health care, and education costs. Warren offers surprising answers to "Who goes bankrupt and why?" and explores the role of banks and credit card companies in tightening the squeeze on the average American family.This clip, from University of California TV's public affairs program "Conversations with History," is an hour long, but well worth watching. Labels: bankruptcy, Elizabeth Warren, income inequality, middle class Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). Free Lunch, by David Cay JohnstonFree Lunch: How the Wealthiest Americans Enrich Themselves at Government Expense (and Stick You With the Bill) by David Cay Johnston  Remy Welling, an IRS tax auditor, had a problem. In December 2002, her boss asked her to sign off on an audit that hadn’t yet begun, essentially giving a company an advance free pass. She refused, and began investigating. Pretty soon, she discovered what the company was up to: changing the issue date of options granted to top executives to maximize their value, at the expense of unwitting stockholders. The practice was widespread, lucrative, and totally illegal. In one instance, it delivered a $70 million bonus to Apple founder Steve Jobs. Unable to interest her superiors in the issue, Welling went to the FBI and the Senate Finance Committee, in vain. Finally, she turned to New York Times reporter David Cay Johnston. When the Times broke the scandal, her boss first threatened to prosecute her, then fired her, and then banned her from working as a tax advisor. Liberals like to blame growing US inequality on greed and globalization. The explanation doesn’t make much sense, because other modern trading economies, like our neighbor Canada, haven’t experienced our upsurge in wealth at the top coupled with stagnation at the bottom. Although Johnston sometimes slips into the conventional rhetoric, he tells a very different story--often approvingly quoting Adam Smith: Ronald Reagan called for liberating business from government interference, in order to let the free market work its wonders. But in practice, Reaganite policy has jiggered the system to redirect money, resources, and power upward. It is not the free market that creates inequality; it is the thousand little ratchets--taxes, subsidies, regulatory loopholes, failed enforcement, giveaways and outright graft--that direct a free lunch to the top 0.1%. Johnston’s new book, Free Lunch, catalogs ratchets, old and new, big and small, familiar and unfamiliar: Local and state governments give away land and tax privileges to national chains--at the expense not only of taxpayers, but of local businesses. Unregulated hedge funds, playing with investments from our pension funds, threaten our financial security. CSX Railroad, under former Bush Treasury Secretary John Snow, deliberately cut back safety inspections and repairs, at the cost of hundreds of deaths and injuries a year in railway accidents. Burglar-alarm companies connect clients to local police stations, forcing police at taxpayer expense to spend hours of police time checking false alarms. Enron rigged the energy markets while regulators looked away. State regulators allowed insiders to privatize non-profit health insurance organizations like Blue Cross of California, buying them from the public at a small fraction of their value, and then raising premiums and cutting service. Johnston has missed a few ratchets. One is the privatization of the military, which has fattened defense contractors in the Iraq fiasco. Another is the giveaway of natural resources, notably electromagnetic spectrum. Yet another is the war on drugs, enriching the private prison industry at the expense of taxpayers and of the many unfortunate poor non-violent offenders. (The US now locks up one in one hundred adults, by far the highest rate among developed countries.) And now it seems we will be giving polluters the right to dump into our air. (See Peter Barnes’ Capitalism 3.0 for an alternative.) Free Lunch makes a rousing sequel to Johnston’s prior book, Perfectly Legal, an expose of tax loopholes. There’s plenty of material for the next installment. Please consider donating to Dollars & Sense and/or subscribing to the magazine (both print and e-subscriptions now available!). |
WASHINGTON—According to a report released Tuesday by the Brookings Institution, a Washington-based think tank, the recent influx of exceedingly affluent powder-wigged aristocrats into the nation's gentrified urban areas is pushing out young white professionals, some of whom have lived in these neighborhoods for as many as seven years.