imc indymedia

Los Angeles Indymedia : Activist News

white themeblack themered themetheme help
About Us Contact Us Calendar Publish RSS
Features
latest news
best of news
syndication
commentary


KILLRADIO

VozMob

ABCF LA

A-Infos Radio

Indymedia On Air

Dope-X-Resistance-LA List

LAAMN List




IMC Network:

Original Cities

www.indymedia.org africa: ambazonia canarias estrecho / madiaq kenya nigeria south africa canada: hamilton london, ontario maritimes montreal ontario ottawa quebec thunder bay vancouver victoria windsor winnipeg east asia: burma jakarta japan korea manila qc europe: abruzzo alacant andorra antwerpen armenia athens austria barcelona belarus belgium belgrade bristol brussels bulgaria calabria croatia cyprus emilia-romagna estrecho / madiaq euskal herria galiza germany grenoble hungary ireland istanbul italy la plana liege liguria lille linksunten lombardia london madrid malta marseille nantes napoli netherlands nice northern england norway oost-vlaanderen paris/Île-de-france patras piemonte poland portugal roma romania russia saint-petersburg scotland sverige switzerland thessaloniki torun toscana toulouse ukraine united kingdom valencia latin america: argentina bolivia chiapas chile chile sur cmi brasil colombia ecuador mexico peru puerto rico qollasuyu rosario santiago tijuana uruguay valparaiso venezuela venezuela oceania: adelaide aotearoa brisbane burma darwin jakarta manila melbourne perth qc sydney south asia: india mumbai united states: arizona arkansas asheville atlanta austin baltimore big muddy binghamton boston buffalo charlottesville chicago cleveland colorado columbus dc hawaii houston hudson mohawk kansas city la madison maine miami michigan milwaukee minneapolis/st. paul new hampshire new jersey new mexico new orleans north carolina north texas nyc oklahoma philadelphia pittsburgh portland richmond rochester rogue valley saint louis san diego san francisco san francisco bay area santa barbara santa cruz, ca sarasota seattle tampa bay tennessee urbana-champaign vermont western mass worcester west asia: armenia beirut israel palestine process: fbi/legal updates mailing lists process & imc docs tech volunteer projects: print radio satellite tv video regions: oceania united states topics: biotech

Surviving Cities

www.indymedia.org africa: canada: quebec east asia: japan europe: athens barcelona belgium bristol brussels cyprus germany grenoble ireland istanbul lille linksunten nantes netherlands norway portugal united kingdom latin america: argentina cmi brasil rosario oceania: aotearoa united states: austin big muddy binghamton boston chicago columbus la michigan nyc portland rochester saint louis san diego san francisco bay area santa cruz, ca tennessee urbana-champaign worcester west asia: palestine process: fbi/legal updates process & imc docs projects: radio satellite tv
printable version - js reader version - view hidden posts - tags and related articles

Deficit Hysteria: Wrongheaded in Times of Depression

by Stephen Lendman Tuesday, Jul. 06, 2010 at 12:58 PM
lendmanstephen@sbcglobal.net

proposed policies are wrecking economies

Deficit Hysteria: Wrongheaded in Times of Depression - by Stephen Lendman

When economic stimulus and productive investment are most needed, public spending cuts are coming, G20 governments agreeing to cut deficits and balance budgets, what economist Michael Hudson calls "fiscal suicide, (months into) a carefully orchestrated financial war against the 'real' economy."

Begun in Washington, Obama, in his first State of the Union address, announced plans to "freeze government spending for three years," starting in 2011, and said he'll establish a bipartisan fiscal commission by executive order, to cut the deficit by imposed austerity - social spending cuts, including Medicare, not defense, banker bailouts, or other handouts to corporate favorites, how Washington works under both parties, anti-populist by any standard, anti-productive when large stimulus is needed to revive the cratering economy.

Yet on February 18, 2010, a White House press release announced the commission's establishment - a "bipartisan National Commission on Fiscal Responsibility and Reform," co-chaired by two deficit hawks, former Republican Senate Whip Alan Simpson and former Clinton administration White House Chief of Staff Erskine Bowles, heading an 18-member team stacked with like-minded members, Democrat and Republican austerity advocates against Medicare, Social Security, and other social spending.

Deepening Global Depression

In his July 3 commentary, longtime market analyst Bob Chapman sees the US economy cratering, perhaps towards another credit collapse, saying:

-- "the (US) housing market is in serious freefall;" June mortgage applications plunged 15% and pending home sales dropped 30% (after temporary tax credits expired), a record low in May;

-- "US (and world) stock markets (are) hav(ing) a case of indigestion;

-- sovereign debt problems rage across the world financial scene;"

-- across the board, economic fundamentals signal worsening hard times;

-- unemployment is increasing, not decreasing, accurate measures putting it over 20%, not the bogus Labor Department figures, hiding the real level;

-- the "warning signs can't be missed, they are all around (us); don't be fooled by smoke and mirrors; stick with reality," a dark one Wall Street and Washington engineered and won't explain;

-- as a result, stock and commodity prices are fading; "bonds could be topping out;"

-- the US economy may "collapse into a deflationary depression;" and

-- America's unemployed won't get extended benefits, but so-called "financial reform" pleases Wall Street, the public again stiff-armed by Congress and the White House, Democrats as corrupted as Republicans.

Economist David Rosenberg is just as negative, publishing daily assessments, the kinds not heard in the mainstream, producing fantasy ones to deceive and defraud, claiming the recession is over, prosperity just ahead, the same all is well theme pundits and politicians repeated at the onset of the Great Depression, what was wrong then and again now. Only a few honest analysts explain it.

In recent weeks, Rosenberg's observed the following:

-- America has "too many vacant houses, empty apartment and office buildings, idle manufacturing plants and unemployed people;"

-- credit keeps contracting rapidly; and

-- money velocity and the multiplier are anaemic, signaling a "highly deflationary brew."

His "worry list" includes:

-- Greek default spreading, harming world economies;

-- credit tightening when stimulus is needed; and

-- America heading for a double-dip recession, a depression he signaled earlier.

"Scary math," examples include:

-- one in 10 US homeowners missed a Q 1 mortgage payment;

-- one in six are either unemployed or underemployed;

-- over four in 10 US workers have been unemployed for at least six months;

-- only one in 10 Americans think their income will rise in the next six months;

-- only one in eight believe government policy is improving the economy;

-- only one in 50 plan to buy a home in the next six months;

-- only one in 10 US small businesses have job openings;

-- one in ten credit card users are defaulting on debt; and

-- five or more unemployed workers compete for every job, "hence downward pressure on wage growth."

He also cites rolled over leading economic indicators, weak retail sales, weak consumer sentiment, rising jobless claims, slowing industrial production, ("the last vestige" of US economic strength), and a disappointing June nonfarm payroll report - distorted by the "fantasy" birth-death model, boosting it by 147,000, and an unemployment level drop to 9.5%, a "statistical illusion" because the labor force "plunged" by 652,000, discouraged workers not looking, not counted, and ignored.

It's so hard finding a job that seekers take "an average of 35.2 weeks," an "unheard of" amount of time, and about 46% of the unemployed have looked in vain for at least six months - "again, this is without precedent."

The broader Household survey, more sensitive to the small business climate, plunged 301,000 in June, following a May 35,000 drop, "the steepest contraction for the year and first back-to-back declines since last fall, (showing) the amount of slack in the US labor market is palpable," deflationary seeds being sown.

"We need a war room dedicated to reviving the moribund labor market," yet administration policies are killing it.

In a recent commentary, financial expert and investor safety advocate Martin Weiss listed "11 startling facts that Obama and Bernanke do NOT want you to think about:"

(1) the official .68 trillion national debt equals 88.5% of the real economy, all goods and services produced annually;

(2) unfunded liabilities for Medicare, Medicaid, Social Security and veterans is an additional 8 trillion, an amount so huge, it will be reneged on and not paid, cleverly over time;

(3) "state, county and local governments are nearly trillion in debt; many can't pay," and will either get federal help, make huge (unacceptable budget cuts) or default;

(4) "total federal, state and local government indebtedness now stands at a mind-blowing 3.6 trillion;"

(5) in FY 2009, the national debt increased by .4 trillion, another .6 trillion coming in FY 2010, and trillions more ahead;

(6) besides funding the annual deficit, increased Treasury borrowings are needed to replace maturing short and longer term debt;

(7) record amounts of issued debt obligations will negatively affect bond prices, causing higher interest rates;

(8) "in a desperate attempt to keep (rates) low, (the Fed) created .25 trillion out of thin air to buy mortgage-backed securities....another 0 billion (for) US Treasuries....and yet another 0.6 billion (for) other government bonds," nearly .7 trillion in total;

(9) from September 2008 - March 2010, the Fed increased the "monetary base from 0 billion to .1 trillion - a 250% increase in 18 months;"

(10) so far, despite massive money-creation, interest rates remain artificially low, but only for so long; and

(11) the US dollar lost nearly 10% of its value in the past 12 months alone, greater erosion ahead because of destructive monetary policy.

Conclusion: "This unprecedented debt crisis is the single greatest threat to your wealth and standard of living in decades," engineered by a Wall Street-Washington cabal.

A Longstanding Cabal Member

His resume reveals a consummate high-level government/corporate insider - formerly Nixon's commerce secretary, chairman of the New York Fed, chairman and CEO of Lehman Brothers and Bell and Howell, board member of seven major corporations, current chairman and co-founder of The Blackstone Group, former chairman of the Council on Foreign Relations (succeeding David Rockefeller), and co-founder and president of the Concord Coalition, calling itself:

"a nationwide, non-partisan, grassroots organization advocating generationally responsible fiscal policy."

In fact, it's partisan and elitist, its board comprised of wealthy powerful figures, including Paul Volker, Robert Rubin, and former Senators Sam Nunn, Warren Rudman, Charles Robb, and Bob Kerry, among others - allied with hard-right groups like the Heritage Foundation. It's for corporate bigness, limited government, imperial wars, fiscal austerity, ending social spending, homeland harshness, banning abortion, abolishing affirmative action, and other extremist positions the Concord Coalition endorses, openly or covertly, including the transfer of public wealth to private hands and corporate takeover of America and world governments, making billionaires like Peterson richer. In 2008, he ranked 149th among the Forbes 400 Richest Americans.

He also established the Peter G. Peterson Foundation "to increase public awareness of the nature and urgency of key economic challenges threatening America's future and accelerate action on them."

Its public and covert positions support:

-- fiscal austerity for the majority, unlimited wealth opportunities for the rich;

-- ending Medicare, Medicaid, Social Security and other social benefits;

-- making America's tax structure even more advantageous for elitists; and

-- improving the nation's healthcare system by offering less, charging more, and letting low and middle-income earners pay or do without.

Its also allied with extremist organizations like Heritage, the American Enterprise Institute, Citizens Against Public Waste, the Concord Coalition, and others, working for their interests, not ours, including deficit fear-mongering, an Ellen Brown theme in her March 1 article titled, "IMF-Style Austerity Measures Come to America: What 'Fiscal Responsibility' Means to You," saying:

Besides government imposed higher health insurance premiums, coming soon may be a " 'mandatory savings' tax and other belt-tightening measures urged by (Obama's Deficit Commission), radical austerity measures (that) will actually make matters worse." More about it below.

The push for "fiscal responsibility" is based on "bad economics," the kind Peterson and his Concord Coalition et alia endorse, a credit shrinking agenda, wrecking world economies, waging class warfare, impoverishing the many and enriching the few by transferring public wealth to private hands - IMF austerity spawning protests in Greece, Iceland, Latvia, Spain, Italy, and France, coming harshly to America, policies Peterson strongly supports, the Obama administration, Congress and other G20 countries as well, the public unaware of what's coming or how draconian, ruinous, and inhumane, promoted by outlandish fear-mongering, Peterson's specialty.

America Speaks - "Engaging Citizens in Governance," the Peterson Funded Group, Selling Snake Oil, not Solutions

Claiming to "reinvigorate American Democracy by engaging citizens in the public-decision-making" process through a series of "21st Century Town Meetings," its agenda is deceptive, destructive and discriminatory, taking aim at Medicare, Medicaid and Social Security, Concord Coalition executive director Robert Bixby calling the latter "low-hanging fruit," easy pickings for deficit cutting profiteers, Peterson adding:

"While a Social Security fix would cure only a small part of the country's long-term fiscal shortfall, it could pay big dividends in terms of the US standing internationally, deficit hawks (like himself) say. It would be a confidence builder with our foreign lenders."

America Speaks snake oil includes a deceptive introductory guide, "Federal Budget 101: An Introduction to the Federal Budget and Our Fiscal Challenges," framing the issues its way, based on false 2025 budget projections, assuming nothing will address growing deficits between now and then, and saying saving America means drastically cutting them, placing the onus on middle America, aiming, of course, to destroy it, through class warfare, impoverishing everyone but the rich, enhancing their wealth and privilege more than ever.

After causing the housing crisis, wrecking the economy, stealing trillions in public wealth, supporting imperial wars and homeland repression, Peterson's scheme (through America Speaks) is to convince people that gutting Social Security and Medicare protects our futures, by destroying them.

Its guide says:

"When government borrows large amounts of money, (our) children and grandchildren may have to endure a weaker economy and lower living standards than they would otherwise enjoy, (and) not even a return to a strong, sustained growth of the 1990s would eliminate the deficit."

In fact, private and publicly created debt work, as long as for productive investment and job creation, stimulating growth. Banks create money and lend it, creating debt - no debt, no money, and under today's credit freeze, the money supply is shrinking, contracting economic growth, creating hardships for millions.

During hard times, if banks won't lend, governments must do it, monetizing debt to reverse a downward cycle, investing it productively to create prosperity, what banker bailouts and imperial wars won't do, or the America Speaks/Concord Coalition solution - what they know but won't explain, what the public must understand to prevent their ideas catching on, ones planning to destroy America to enrich them, one way by a "mandatory savings tax," endorsed by Peterson and the Obama administration.

One proposal calls for all employers in business two years or longer to establish mandatory, Social Security Administration-handled, IRA accounts, funded by an automatic payroll deduction (a tax, perhaps 3%) - letting Wall Street manage the money, the same folks that created the bubble economy, crashed it, and now want a new revenue source to do it again, destroying more of middle America's savings, Peterson et alia supportive because Blackrock Financial, created by his Blackstone Group, will profit.

It unmasks their real agenda and meaning of "fiscal responsibility" - class warfare to wreck America, destroy the middle class, and make billionaires like Peterson much richer, what Professor Carroll Quigley explained in his 1966 book, "Tragedy and Hope," saying:

"(T)he powers of financial capitalism (have a) far-reaching aim, nothing less than to create a world system of financial control in private hands to dominate the political system of each country and the (entire world economy). This system (would) be controlled in a feudalist fashion by (global, privately run central banks), acting in concert" secretly.

As Ellen Brown and others explain, their plan "is virtually complete. Unless we wake up to what (Peterson et alia want) and take action, the 'powers of financial capital' will have their way."

With a lock on both US parties, they've got it, what only mass activism can reverse, what so far a comatose America lacks, what hopefully will change before it's too late to matter.

Stephen Lendman lives in Chicago and can be reached at lendmanstephen@sbcglobal.net. Also visit his blog site at sjlendman.blogspot.com and listen to cutting-edge discussions with distinguished guests on the Progressive Radio News Hour on the Progressive Radio Network Thursdays at 10AM US Central time and Saturdays and Sundays at noon. All programs are archived for easy listening.

http://www.progressiveradionetwork.com/the-progressive-news-hour/.

Report this post as:

Local News

Why Should California Choose De Leon Over Feinstein? O10 9:55PM

Change Links September 2018 posted S02 10:22PM

More Scandals Rock Southern California Nuke Plant San Onofre A30 11:09PM

Site Outage Friday A30 3:49PM

Change Links August 2018 A14 1:56AM

Setback for Developer of SC Farm Land A12 11:09PM

More problems at Shutdown San Onofre Nuke J29 10:40PM

Change Links 2018 July posted J09 8:27PM

More Pix: "Families Belong Together," Pasadena J02 7:16PM

"Families Belong Together" March, Pasadena J02 7:08PM

Short Report on the Families Belong Together Protest in Los Angeles J30 11:26PM

Summer 2018 National Immigrant Solidarity Network News Alert! J11 6:58AM

Watch the Debate: Excluded Candidates for Governor of California M31 5:20AM

Change Links June 2018 posted M28 7:41AM

The Montrose Peace Vigil at 12 Years M22 8:01PM

Unity Archive Project M21 9:42AM

Dianne Feinstein's Promotion of War, Secret Animal Abuse, Military Profiteering, Censorshi M17 10:22PM

CA Senate Bill 1303 would require an independent coroner rather than being part of police M10 9:08PM

Three years after OC snitch scandal, no charges filed against sheriffs deputies M10 8:57PM

California police agencies violate Brown Act (open meetings) M02 8:31PM

Insane Company Wants To Send Nuke Plant Waste To New Mexico A29 11:47PM

Change Links May 2018 A27 8:40AM

Worker-Owned Car Wash on Vermont Closed A27 5:37AM

More Local News...

Other/Breaking News

Politoscope plurivalent O17 6:59AM

Paraphysique du microcosme macrocosme O15 6:44AM

September 2018 Honduras coup update O15 3:31AM

The Nation Unites Against Brian Kemp, Most Racist Secretary of State in US O14 7:34AM

The Nation Unites Against Brian Kemp, Most Racist Secretary of State in US O14 7:23AM

Paraphysique de l'ubérisation O13 7:56AM

22 Ways Trump Has Increased US Deficit By 4 to 5 Trillion Dollars O12 10:34PM

Debunking Some Anti-Prop 10 Propaganda O12 6:56AM

Plus d'hôpitaux, à bas les aéros O12 6:38AM

When Banana Ruled (documentary) O11 3:00AM

Outstanding Report By RAMOLA D &Dr.Tomo Shibata O10 9:17PM

Dark Clouds Gather on Horizon for Financial System, Warns International Monetary Fund O10 1:51PM

Fbi pure evil & immorality O10 5:39AM

Reality Check: Palestinian-Israeli Coexistence is a Big Lie O09 7:40PM

Voiceless Animals: 2018 Candidates They Oppose O09 7:01PM

IMF Lowers Global Growth Projections and Raises Concerns of Financial Crisis O09 3:27PM

Canitie, l'inhumanité vieillit O09 7:13AM

L'anarchie en quelques exemples O07 6:50AM

100 Ways GOP Have Stolen Elections Since 1876 O06 12:03AM

Proximospective de l'univocité réifiée O05 6:27AM

“Kava-no!!!” O04 6:42PM

Trump & Palestine vs. Genesis, Rashi & The Land of Israel O03 6:29PM

The Criminality of the Elites O03 11:35AM

Business de l'inhumanitaire O03 7:51AM

Marriage Rape/Date Rape Highest Rapes O02 2:59PM

Women I Know Get Raped - Too Many Times To Count! O02 2:55PM

Women In USA Have Stockholm Syndrom O02 2:50PM

Shooting Drill's Are Political Actual Shootings O02 2:47PM

More Breaking News...
© 2000-2018 Los Angeles Independent Media Center. Unless otherwise stated by the author, all content is free for non-commercial reuse, reprint, and rebroadcast, on the net and elsewhere. Opinions are those of the contributors and are not necessarily endorsed by the Los Angeles Independent Media Center. Running sf-active v0.9.4 Disclaimer | Privacy