Re-Thinking Capitalism

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As one of the nation’s premier non-economists, I have some thoughts I’d like to share about how to fix the economy to the betterment of the many over the enrichment of the few. We’ve all heard the expression, “The rich get richer and the poor get poorer.” Most of us believe it to be true (because it is), but the naysayers are almost always from the elite class of people who have quite a lot of money. More than they need, if you want to be perfectly honest. And to me, therein lies the heart of the debate: Should Capitalism be about getting what you need, or getting what you want?

The people who study this stuff refer to it as Wealth Condensation, but I’m a non-economist, so I’m simply going to refer to it as a “flaw” in the system. In a nutshell, the way things are set up right now, wealth flows through the system into the hands of an elite few – the Super Rich. I’m talking about the people with, like, a hundred million dollars or more. They’re out there, and they have a lot of the money. Continue reading

The Right-Wing Label

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Cross-posted from Pick Wayne’s Brain:

The Right-Wing in this country uses fear and hate to win public support for their ideas. This cannot be disputed, and was even studied by Associate Professor Jonathan Haidt (“What Makes People Vote Republican?). In a nutshell, when our fears and emotions are tapped, we tend to react first and rationalize what we did later, even if our “rationale” is in conflict with the facts. Rather than appeal to our intellect and ability to reason our way to a solution, the Right-Wing stokes fear and hate and then tells you who to fear and who to hate. The reason why you should fear and hate becomes completely irrelevant once they have tapped into your emotions, for any kind of “reasoning” will make sense if it makes you feel justified in doing what you did, even if you normally would have thought that what you were doing was wrong. Without this tactic, they could not win support for their arguments on the facts alone. (And when I talk about “facts”, I’m talking about things that are actually true, not what many people might believe to be the truth.)

Whether they want to admit it or not, this attribute in humans to have our sense of fear and hate be easily tapped comes from our evolutionary survival skills.  Continue reading

How to Ground The Street

How to Ground The Street
By Eliot L. Spitzer (published in the Washington Post)

[..] First, we must confront head-on the pervasive misunderstanding of what constitutes a “free market.” For long stretches of the past 30 years, too many Americans fell prey to the ideology that a free market requires nearly complete deregulation of banks and other financial institutions and a government with a hands-off approach to enforcement. “We can regulate ourselves,” the mantra went.

Those of us who raised red flags about this were scoffed at for failing to understand or even believe in “the market.” During my tenure as New York state attorney general, my colleagues and I sought to require investment banking analysts to provide their clients with unbiased recommendations, devoid of undisclosed and structural conflicts. But powerful voices with heavily vested interests accused us of meddling in the market.

When my office, along with the Department of Justice, warned that some of American International Group’s reinsurance transactions were little more than efforts to create the false impression of extra capital on the company’s balance sheet, we were jeered at for attacking one of the nation’s great insurance companies, which surely knew how to balance risk and reward.

And when the attorneys general of all 50 states sought to investigate subprime lending, believing that some lending practices might be toxic, we were blocked by a coalition of the major banks and the Bush administration, which invoked a rarely used statute to preempt the states’ ability to probe. The administration claimed that it had the situation under control and that our inquiry was unnecessary.

Time and again, whether at the state level, in Congress or at the Securities and Exchange Commission under Bill Donaldson, those who tried to enforce the basic principles that would allow the market to survive were told that the “invisible hand” of the market and self-regulation could handle the task alone.

The reality is that unregulated competition drives corporate behavior and risk-taking to unacceptable levels. This is simply one of the ways in which some market participants try to gain a competitive advantage. As one lawyer for a company charged with malfeasance stated in a meeting in my office (amazingly, this was intended as a winning defense): “You’re right about our behavior, but we’re not as bad as our competitors.” [..]

Go read it ALL!

Continue reading

Treasury Secretary Jon Corzine?

This article by John Nichols is reassuring. All the talk in the media has been about whether or not President Barack Obama will ask Hillary Clinton to be his Secretary of State, but John Nichols of The Nation write about the ‘talk’ swirling around about the possibility of Jon Corzine becoming the Treasury Secretary, and makes the case why that just might be a ‘Progressive’ choice.

Treasury Secretary Jon Corzine?:

Everyone is excited about the fact that President-elect Barack Obama is talking with New York Senator Hillary Clinton about the prospect that she might serve as Secretary of State. But the big news from inside the transition process is the speculation that New Jersey Governor Jon Corzine might be selected for the essential economic position of Secretary of the Treasury.

Corzine certainly has one of the “qualifications” that official Washington demands. He is a former senior partner with Goldman Sachs, the firm that has contributed so many Cabinet secretaries and administration insiders over so many years that it is referred to as “Government Sachs.”

But Corzine is not your typical Goldman-Sachs man.

After he was elected to the US Senate from New Jersey in 2000, Corzine searched out Minnesota Senator Paul Wellstone. The new senator from New Jersey informed the iconic liberal Democrat — who was often at odds with his own party’s leadership — that he hoped they could work together on social and economic justice issues.

Corzine, a very wealthy former Goldman-Sachs chairman and co-CEO, might have seemed like an unlikely economic populist. But he soon made the senator from Minnesota a believer. Indeed, when we were sitting in his office one afternoon in 2001, talking about the senators who could be counted on to stand up to the new Bush-Cheney administration, Wellstone said, “Put Corzine of the list. He’s going to surprise people…

Read on..

Who IS Jon Corzine?

How ‘Depressing” will it get?

I am a huge fan of Paul Krugman.

Here is his latest article in The NY Times: Depression Economics Returns.

He doesn’t seem to think we will experience another “Great Depression”, but he says:

We are already, however, well into the realm of what I call depression economics. By that I mean a state of affairs like that of the 1930s in which the usual tools of economic policy — above all, the Federal Reserve’s ability to pump up the economy by cutting interest rates — have lost all traction. When depression economics prevails, the usual rules of economic policy no longer apply: virtue becomes vice, caution is risky and prudence is folly…

He goes on to explain further. I really wish he was one of the close economic experts advising President-elect Barack Obama right now..

Turley: Blanket pardons would be ‘final nail in Bush’s coffin’

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Blanket pardons issued on the way out the door by President Bush, covering up all the crimes committed by this rogue administration and their cronies and underlings, would be the final ‘finger’ to the nation.. It must not be allowed to happen — or allowed to stand once it does happen.

And I am praying that there will be an ARMY of ‘whistleblowers’ prepared to come out of the woodwork come January 21, 2009, ready to tell their tales to any and all that will listen!

Raw Story

President Bush has consistently claimed executive privilege in response to attempts to investigate potentially illegal actions by his administration, and it now seems that he could continue to make that claim even after leaving office. There is also speculation that Bush could issue blanket pardons for anyone who might have engaged in torture or other criminal activities under his orders.

On Wednesday, an article in the New York Times noted that President Truman had invoked executive privilege in 1953, when he was no longer president, to avoid having to testify before the House Un-American Activities Committee. Congress did not challenge that unprecedented claim, and legal cases involving Watergate and Iran-Contra have given it some tentative support.

“Can they really do that?” MSNBC’s Rachel Maddow asked constitutional law expert Jonathan Turley on Thursday.

“This is very controversial,” Turley replied. “Truman’s own people later questioned whether they actually did have the right that they invoked, and it’s really never been tested, it’s never gone to the Supreme Court. I personally have considerable doubts about it.

“Turley explained that although federal law gives former presidents control over the release of presidential papers, what is being discussed here goes far beyond that. He indicated his belief that “this idea that President Bush can continue to invoke executive privilege even against the position of a sitting president, I think is pretty shaky.”

Read the rest of this article..

Barack Obama – The weekly address

For the first time, the weekly Democratic address has been released as a web video. It will also continue to air on the radio.

President-elect Obama plans to to publish these weekly updates through the Transition and then from the White House.

Today’s address from the President-elect concerns the current economic crisis:

The text.