Monday, August 29, 2011

Bold, Drastic Action Necessary

2005 map of Worldwide Governance Indicators, w...Image via WikipediaThe Stimulus Bill Was Messed Up
Three Million Jobs
Global New Deal Needed
A Second Stimulus Bill Needed

The governments in America and Europe have to together come up with a two trillion dollar fund. A big chunk of that money has to go to connect every human being to high speed internet access. It will pay for itself. Down the line the infrastructure thus built would gradually be sold off to the private sector. Money thus received would pay for the expenses now. I foresee profits.

This has to be completed in one to two years.

The second step would be to lay down a new architecture for global finance. This is hard for Americans to do because that might involve bringing to an end the dollar's special place in the world.

There has to be a massive push for democracy. A universal spread of democracy could be brought about in a few swift years. Once that happens rule of law between nations can then be imagined. Once rule of law between nations has been established, America could bring down its defense spending from 600 billion dollars annually to a more manageable 100 billion dollars. America can not think of a better cost cutting plan.

The US Military Budget Needs To Come Down To 100 Billion From 600

And there is a need for massive jobs programs.

Three Million Jobs
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Friday, August 26, 2011

This Is About Global Warming

Mean surface temperature change for the period...Image via Wikipedia
Popular Mechanics: What Happens When a Super Storm Strikes New York?: Canton, Mo., a town of 2500 on the upper Mississippi River, has been at the center of an increasingly high-stakes environmental wager for years now. In the summer of 1993, a high-pressure system stalled over the southeastern U.S., forcing the jet stream, laden with moist air from the Gulf of Mexico, to the north, where it collided with cold air from Canada. As a result, rainstorms drenched the upper Midwest. Many towns received two to six times the normal amount of rainfall for June and July. ...... The Mississippi River crested at 13.8 feet above official flood levels in Canton, overtopping several local levees. That year, more than 1000 levees ruptured or overflowed along the Mississippi and Missouri rivers. Seventy towns, including Canton, flooded. The water stayed high for six months. ...... According to government statistics, the flood that Canton experienced in 1993 was a freak, one-in-500-year event—not something that would happen again soon. That estimate came from analyzing the 140-year historical record—calculating the frequency of floods of various magnitudes and extrapolating the curve out to events at a scale never seen before. If only it were that simple. Canton suffered another 500-year flood in 2008, a 70-year flood in 2001, and 10-year floods in 1996, 1998 and again in early 2011. Plenty of towns across the region have suffered similar events. ....... "We're witnessing higher and higher floods over time," says Robert Criss, a hydrogeologist at Washington University in St. Louis. "We are seeing higher and far more frequent floods than government estimators say we should."
A few years back there were unexplained fires across Greece. And law enforcement grabbed known arsonists and threw them into prison. Those were not acts of arson. That was global warming. People who study and predict weather look for patterns in historical records. That is misleading. Global warming is a recent phenomenon. New weather patterns are emerging. More frequent severe weather conditions are being experienced.

Global warming is happening, and it is happening now, and there are to be catastrophic consequences. How do you shout that from the rooftops? How do you drain a hole in the Tea Party brain and pour that wisdom down it? Mother Nature is doing it for us. Severe weather conditions are but a start.

Hurricane Irene Eats Up My Santogold Saturday
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Monday, August 15, 2011

The Stupid, Stupid Bush Tax Cuts

Warren Buffett speaking to a group of students...Image via WikipediaThe Bush tax cuts are the reason the Great Recession happened. The continuation of the same is the reason we are not fully out of the recession yet. And now I have Warren Buffett seconding that opinion.
New York Times: Stop Coddling the Super-Rich: While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks. Some of us are investment managers who earn billions from our daily labors but are allowed to classify our income as “carried interest,” thereby getting a bargain 15 percent tax rate. Others own stock index futures for 10 minutes and have 60 percent of their gain taxed at 15 percent, as if they’d been long-term investors. ........ These and other blessings are showered upon us by legislators in Washington who feel compelled to protect us, much as if we were spotted owls or some other endangered species. It’s nice to have friends in high places. ...... Last year my federal tax bill — the income tax I paid, as well as payroll taxes paid by me and on my behalf — was $6,938,744. That sounds like a lot of money. But what I paid was only 17.4 percent of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent. ....... If you make money with money, as some of my super-rich friends do, your percentage may be a bit lower than mine. But if you earn money from a job, your percentage will surely exceed mine — most likely by a lot. ....... Last year about 80 percent of these revenues came from personal income taxes and payroll taxes. The mega-rich pay income taxes at a rate of 15 percent on most of their earnings but pay practically nothing in payroll taxes. It’s a different story for the middle class: typically, they fall into the 15 percent and 25 percent income tax brackets, and then are hit with heavy payroll taxes to boot. ........ I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off. And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation. ........ In 1992, the top 400 had aggregate taxable income of $16.9 billion and paid federal taxes of 29.2 percent on that sum. In 2008, the aggregate income of the highest 400 had soared to $90.9 billion — a staggering $227.4 million on average — but the rate paid had fallen to 21.5 percent. ........ 88 of the 400 in 2008 reported no wages at all, though every one of them reported capital gains. Some of my brethren may shun work but they all like to invest. (I can relate to that.) ....... I would leave rates for 99.7 percent of taxpayers unchanged and continue the current 2-percentage-point reduction in the employee contribution to the payroll tax. This cut helps the poor and the middle class, who need every break they can get. ....... for those making more than $1 million — there were 236,883 such households in 2009 — I would raise rates immediately on taxable income in excess of $1 million, including, of course, dividends and capital gains. And for those who make $10 million or more — there were 8,274 in 2009 — I would suggest an additional increase in rate.
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Sunday, August 14, 2011

London Has Become Cairo (2)

DAVOS/SWITZERLAND, 29JAN10 - David Cameron, Le...Image via Wikipedia
Wall Street Journal: Repressing the Internet, Western-Style: As the British police, armed with the latest facial-recognition technology, go through the footage captured by their numerous closed-circuit TV cameras and study chat transcripts and geolocation data, they are likely to identify many of the culprits. ..... Authoritarian states are monitoring these developments closely. .... They hope for at least partial vindication of their own repressive policies. ..... Prime Minister David Cameron said that the government should consider blocking access to social media for people who plot violence or disorder. ...... After the recent massacre in Norway, many European politicians voiced their concern that anonymous anti-immigrant comments on the Web were inciting extremism. They are now debating ways to limit online anonymity. ....... acts of terror briefly deprive us of the ability to think straight. We are also distracted by the universal tendency to imagine technology as a liberating force; it keeps us from noticing that governments already have more power than is healthy. ...... After violent riots in 2009, Chinese officials had no qualms about cutting off the Xinjiang region's Internet access for 10 months. ...... In their concern to stop not just mob violence but commercial crimes like piracy and file-sharing, Western politicians have proposed new tools for examining Web traffic and changes in the basic architecture of the Internet to simplify surveillance. ..... Should America and Europe abandon any pretense of even wanting to promote democracy abroad? Or should they try to figure out how to increase the resilience of their political institutions in the face of the Internet?
I have never believed in political violence. I don't today. But I do believe in mass action. I don't believe in rioting. But then I don't see the London riots as simply a law and order problem.

The economic roadmap that the Conservative government in Britain has in place as the solution to the recession is precisely the wrong move to make. This is a time for massive rethink on the part of governments and also massive spending to make up for lost private expenditures. Britain is going the wrong way.

If America were to go down that cut the spending route, the recession would deepen, and there would be riots in America.

What is happening in London is less a failure of the British police to control mobs and more the failure of the Conservative government. It is primarily a policy level failure.

There is a need for a massive rethink of the nation state also in long established democracies. Instead of protesting Wikileaks (Learning The Wrong Lessons From Wikileaks) government departments and agencies should be embracing social media like tech startups.

The Internet And The Emperors

There should be talk of one gigabit per second kind of internet access for all and the resultant universal lifelong education. The goal should be universal health care. The goal ought be a Global Marshall Plan.

When it is time to think big, Cameron has thought small. And he has problems on his hands. Tea Party, take note.

London Riots: Debate
The Stimulus Bill Was Messed Up
Three Million Jobs
Global New Deal Needed
London Has Become Cairo
A Second Stimulus Bill Needed
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Friday, August 12, 2011

The Stimulus Bill Was Messed Up

Mussolini (left) and Hitler sent their armies ...Image via Wikipedia
  1. It was too small. It should have been at least a trillion. (Stimulus: Make It A Trillion, Stimulus: Size Matters)
  2. One third of the stimulus going to tax cuts was a huge mistake. That was like appeasing the Republicans, not one of who voted for the bill anyways. When the world appeased Hitler, World War II happened. When Obama appeased the Republicans, the Tea Party happened, and he lost the House. 
  3. That one third should have been spent on jobs programs where you train people for a week and you send them out to work for $10 per hour, $20 per hour. (Three Million Jobs)
  4. The number one goal of the stimulus bill should have been to take every American to one gigabit per second kind of internet access. But most of the focus stayed on physical construction. That was the equivalent of FDR putting all his stimulus money into farm jobs. No, he focused on industries, and the jobs of tomorrow. 
  5. There was not enough global focus. There were too many Great Depression lessons that were applied to the Great Recession. The number one aspect of this Great Recession is its global component. A new global financial architecture has to be built. That is policy level work. 
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Thursday, August 11, 2011

Three Million Jobs

Suffrage universel dédié à Ledru-Rollin, paint...Image via WikipediaSend one million mentors into all the low performing schools across the country. Pay them.

Send one million people to white wash roofs across America. Pay them.

Get a million people to do the netroots thing on behalf of democracy movements across the globe. Pay them. Send 50,000 netroots activists to go out into the world to help those democracy movements from nearby countries.

My point being what America needs is a massive jobs program. And I say start with people who you can pay $10 per hour, $20 per hour.

These are people you should be able to put to work with a week or two of training.

Global New Deal Needed
London Has Become Cairo
A Second Stimulus Bill Needed
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Global New Deal Needed

DAVOS/SWITZERLAND, 25JAN08 - Gordon Brown, Pri...Image via WikipediaI am in agreement with Gordon Brown.
Gordon Brown: Global New Deal: America’s path to growth through higher consumption is blocked by high personal borrowing and negative equity. Another well-trodden road out of recession—a private investment spurt—has failed to materialize as businesses hoard cash in the absence of a growing home market. ........ And now that the debt deal will forestall the other traditional path—a stimulus from public investment—just one route to sustained growth remains that can prevent a decade of high American unemployment. ....... Obama should now refocus his attention on securing a global growth pact that will free the world as a whole, and particularly the West, from years of anemic growth. ....... far bolder: “America’s plan for the world economy”—to achieve for global trade and growth now what Gen. George Marshall’s plan did for the faltering world of the 1940s. ........ a “global New Deal” ....... Today, 60 percent of China’s income comes from exports, while America’s export share is just 25 percent. ..... The need is urgent because as Asia’s middle classes double in the next decade, its consumer market will dwarf all others, accounting for 40 percent of all global consumer spending. Without a bigger footprint in Asia, America will be left behind. ....... if—as predicted—India, China, Brazil, South Africa, Mexico, Turkey, South Korea, Indonesia, and Russia, which today buy just 15 percent of U.S. exports, account for 70 percent of future global growth, then no American company can afford to stay at home. ........ Europe’s only hope of salvation from a decade of high unemployment is to export its way to growth. ....... an up-skilling of America’s middle class and calls for U.S. public and private sectors to frontload investment in education technology and infrastructure. And a global growth pact will require America to agree to common global financial standards that can prevent future financial crises. ......... with each iPad sale, only $4 of profit go to its Asian manufacturers, while $80 go to its American (and British) designers ........ From now until Election Day, the president’s opponents will frame his position as “burdening our children with debt.” Indeed, so adept have those on the right been at playing the politics of fear, on all continents, that even in Australia—a country with virtually no debt—the incumbent Labour government lost its majority when it was faced with a conservative onslaught about deficits. ....... Two thirds of a century ago, after the greatest of depressions and the worst of wars, General Marshall rejected the politics of fear for the economics of hope, and the Marshall Plan pioneered a global program that framed the new world order. It repaid itself many times over, doubling global trade and putting America’s flagging postwar economy on course for its most successful era ever. Now, with the same vision and by accepting that a global new deal is the only way forward, an America reborn can lead again.
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London Has Become Cairo

Barack Obama, President of the United States o...Image via WikipediaPeople in America who seek to cut government spending in ways that will send the world economy hurtling down into a grand recession should look to London now. And you thought only Third World dictators needed to face street power.

This is not the time for austerity measures. This is the time for a Global Marshall Plan.

No black person before Barack Obama ever became President Of The United States. That was racism. Blaming Obama for what Bush did is racism. Blaming Obama for not having brought forth some kind of a leftist utopia is also racism.

When you disagree with Tea Party fiscal insanity and blatant racism, you support the other guy. That other guy is Barack Obama. There are too many liberals in America who neither oppose the Tea Party nor support Barack Obama and simply sit back and complain. These are people who only get energized whey they are completely thrown out of power. These are people addicted to powerlessness.

You have to learn to be in power. The liberal crowd has much to learn.
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Monday, August 08, 2011

A Second Stimulus Bill Needed

Great Depression: man dressed in worn coat lyi...Image via Wikipedia
New York Times: Second Recession in U.S. Could Be Worse Than First: the economy is much weaker than it was at the outset of the last recession in December 2007, with most major measures of economic health — including jobs, incomes, output and industrial production — worse today than they were back then. And growth has been so weak that almost no ground has been recouped, even though a recovery technically started in June 2009. ..... When the last downturn hit, the credit bubble left Americans with lots of fat to cut, but a new one would force families to cut from the bone. Making things worse, policy makers used most of the economic tools at their disposal to combat the last recession, and have few options available. ....... the four years since the recession began ...... Today the economy has 5 percent fewer jobs — or 6.8 million — than it had before the last recession began. The unemployment rate was 5 percent then, compared with 9.1 percent today..... the typical private sector worker has a shorter workweek today than four years ago...... Income levels are low, and moving in the wrong direction ...... with construction nearly nonexistent and home prices down 24 percent since December 2007, the country does not have a buffer in housing to fall back on. ..... the economy is smaller today than it was when the recession began ....... Unlike during the first downturn, there would be few policy remedies available if the economy were to revert back into recession. ....... Interest rates cannot be pushed down further — they are already at zero. The Fed has already flooded the financial markets with money by buying billions in mortgage securities and Treasury bonds, and economists do not even agree on whether those purchases substantially helped the economy. So the Fed may not see much upside to going through another politically controversial round of buying. ...... at the end of 2007, the federal debt was 64.4 percent of the economy. Today, it is estimated at around 100 percent of gross domestic product, a share not seen since the aftermath of World War II, and there is little chance of lawmakers reaching consensus on additional stimulus that would increase the debt. ...... “There is no approachable precedent, at least in the postwar era, for what happens when an economy with 9 percent unemployment falls back into recession” ...... 1937, when there was also a premature withdrawal of fiscal stimulus, and the economy fell into another recession more painful than the first ..... Corporate profits are at record highs
Even before this recession hit in 2007 China was on schedule to become the number one economy in the world by 2016. Continued policy mistakes in America might only hasten that process. There has been much self destructive behavior.

The stimulus bill was not big enough. The stimulus money was not spent fast like it needed to be to have any effect. One third of the stimulus bill was tax cuts. That was a mistake. Obama did that to get Republican votes, and no Republican voted for the bill anyway. That instead was seen as a sign of weakness and might have hastened the Republican takeover of the House.

The biggest chunk of the stimulus bill needed to go to taking all of America to one gigabit per second kind of broadband. Instead the biggest chunk of the money went to old economy stuff and to humdrum payments. Paying the unemployed is important, but paying the unemployed is not what creates the next generation of jobs.

The threat of a double dip is very real. And the one thing that can save the country is a stimulus bill.

The biggest mistake perhaps has been to apply Great Depression lessons to the Great Recession. The Great Recession is America reeling from a lack of global institutions that globalization asks for. Capital wants to go global at breakneck speeds, but the global infrastructure to make that happen is not there. The Great Depression gave us macroeconomics. The Great Recession needs to give us globoeconomics.

What is needed is massive jobs programs, massive public works programs. Send a million mentors into the inner city schools, and pay them. Send another million to whitewash the roofs across America, and pay them.

Extending the Bush tax cuts was nothing less than criminal.
New York Times: London Sees Twin Perils Converging to Fuel Riot: Frustration in this impoverished neighborhood, as in many others in Britain, has mounted as the government’s austerity budget has forced deep cuts in social services. At the same time, a widely held disdain for law enforcement here, where a large Afro-Caribbean population has felt singled out by the police for abuse, has only intensified through the drumbeat of scandal that has racked Scotland Yard in recent weeks and led to the resignation of the force’s two top commanders...... there was not long to wait until a new one erupted: across London, skirmishes broke out on Sunday between groups of young people and large numbers of riot police officers, which one officer said were drawn from forces around London. ...... In Enfield, a usually calm suburb, shop windows were smashed and debris lay in the street. In nearby Edmonton, groups of young people gathered near damaged storefronts. In Tottenham itself, roads were closed, a helicopter hovered overhead and squads of police vans swooped in to make arrests in side streets. ....... The march turned into a pitched battle between hundreds of officers, some on horses, and equal numbers of rioters, wearing bandannas and armed with makeshift weapons that included table legs and an aluminum crutch. Looting throughout northern London continued past dawn, leaving streets littered with glass. In daylight, residents emerged to survey buildings, many considered landmarks, that had been left gutted and smoldering. ........ unless endemic youth unemployment in Tottenham was curbed, “this will happen again. These kids don’t care. They don’t have to pay for this damage, we do. Working people do. What do they have to lose?” ...... many voiced concern that looters in other areas of London had been allowed to smash and steal for several hours before officers arrived. ....... Economic malaise and cuts in spending and services instituted by the Conservative-led government have been recurring flashpoints for months. ....... Prince Charles and his wife, Camilla, the Duchess of Cornwall, were attacked in their Rolls-Royce as protesters — some of whom were subsequently jailed — shouted “Tory scum,” a reference to the Conservative Party’s traditional links with the aristocracy, and “off with their heads!” In March, a reported 500,000 people marched against the cuts, with some protesters occupying the exclusive food store Fortnum & Mason — Prince Charles’s grocer. ...... one man shouted, “This is our battle!” When asked what he meant, the man, Paul Rook, 47, explained that he felt the rioters were taking on “the ruling class.” ....... As the budget cuts take hold, risk of unemployment increases and social measures like youth projects are sacrificed, Mr. Beech said, and “all logic says there will be an increase in antisocial behavior.” “Boredom, alienation and isolation are going to be factors”
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