Het Neoliberale Geloof 95

'U.S. SINKS DEEPER...

Half-point cut? Testifying before the Senate banking committee, U.S. Fed chairman Ben Bernanke rejected the notion that a recession is imminent. But, he said, the Fed will act in a 'timely manner' in an effort to quell the downturn that's well under way.

Sluggish growth, more interest rate relief, but no recession.

That's the latest status update on the slumping U.S. economy from Federal Reserve Board chief Ben Bernanke as he testified yesterday before the Senate banking committee.

With the economy still deteriorating, he vowed that the central bank would act in a "timely manner" as an insurance policy against an even steeper downturn.

"My baseline outlook involves a period of sluggish growth, followed by a somewhat stronger pace of growth starting later this year as the effects of monetary and fiscal stimulus begin to be felt," Mr. Bernanke told the committee.

Mr. Bernanke also painted a grim picture of the housing market, which he said is continuing to worsen due to tighter lending standards.

There has been a "virtual shutdown" of the subprime loan market - geared at borrowers with poor credit histories - as well as much tighter credit conditions across a broad swath of the lending industry.

All that, he said, is depressing home values, pushing up the inventory of unsold homes and weighing on consumers.

Mr. Bernanke has been reluctant to acknowledge the possibility that the U.S. may be headed for recession, even though many Wall Street economists say the country is already in one. But he conceded the Fed's next quarterly forecast, due out shortly, would show "lower projections of growth" that are "reasonably consistent" with private sector numbers.

U.S. Treasury Secretary Henry Paulson, testifying alongside Mr. Bernanke, also rejected the possibility of a recession, which is typically marked by at least two quarters of shrinking economic activity.

"Growth looks to be weak, but still positive," Mr. Paulson said.

Mr. Bernanke and Mr. Paulson faced a few subtle jabs about not anticipating the economic downturn. But on the whole, the hearing was remarkably civil given the growing angst about the economy among consumers, investors and businesses.

Credit problems that began in the housing sector have spread to other areas of lending, forcing up interest costs for many businesses and even local governments. Meanwhile, the first signs of trouble have emerged in the job market, where employment fell in January for the first time in nearly five years. What's more, high energy costs and falling stock prices are weighing on consumer confidence.

Economists interpreted Mr. Bernanke's comments as a pledge to cut the central bank's benchmark interest rate next month.

Economist Ryan Sweet of Moody's Economy.com said he expects another half-a-percentage-point cut in the Fed's benchmark rate when it meets again on March 18.

"The Bernanke-led Fed has put gradualism to bed," Mr. Sweet said.

The Fed has already lowered the federal funds rate by 2.5 percentage points since last summer - 1.25 points in January alone. The rate currently stands at 3 per cent - the lowest rate since mid-2005.'

Lees verder: http://www.theglobeandmail.com/servlet/story/LAC.20080215.IBUSECONOMY15/TPSt

The Empire 356

Frida Berrigan: Surge in spending on nukes a grave error
Frida Berrigan
The Capital Times

For many Americans, nuclear weapons bring up old memories and forgotten associations -- the duck and cover drills of the 1950s, President Reagan's exhortations against the "evil empire," and the plot lines of countless straight-to-video political thrillers. It may then come as a surprise that in 2008 the United States is considering a huge new investment in nuclear weapons.The U.S. Department of Energy's National Nuclear Security Administration is pushing for an estimated $150 billion to develop a new generation of nuclear weapons and a more "responsive" production network. The centerpiece of this move is called Complex Transformation, a multiyear plan to build new or upgraded facilities at each of the NNSA's eight nuclear weapons-related sites. The plan also calls for building a new nuclear weapon called the reliable replacement warhead, which would replace all deployed weapons in the U.S. arsenal.This proposal would build on the Bush administration's quiet surge in nuclear weapons spending. Adjusting for inflation, U.S. spending on nuclear weapons has increased by over 13 percent since 2001. More importantly, the U.S. is still spending one-third more than the Cold War average on nuclear weapons.There are considerable problems associated with the Complex Transformation plan; chief among them are its huge costs, questionable necessity and danger of provoking nuclear proliferation.Is it too costly? Any way you look at it, $150 billion is a lot of money. But, given the Department of Energy's track record, it could be even more. A report from the Government Accountability Office last year examined 12 major DOE construction projects and found that eight are saddled with cost over-runs ranging from $79 million to $7.9 billion.Is Complex Transformation necessary? Not likely. A 2007 study by JASON, the independent science group that advises the government on defense issues, confirmed that the existing warhead cores could be viable for 100 years or longer. And since the size of the U.S. arsenal should be moving down, not up, there is no need for a costly upgrade of the production complex.Is it provocative? Yes. An expanded U.S. nuclear arsenal tells the world that U.S. national security remains dependent on these devastating weapons. At the same time, Washington seeks to convince nations like Iran and North Korea not to produce them. This "do as we say, not as we do" approach encourages nuclear proliferation. If trends continue, nuclear expert Hans Blix forecasts at least a dozen new nuclear powers within 10 years.Green-lighting a massive investment in nuclear weapons is both premature and foolhardy. For one, the U.S. does not have a clear sense of what its nuclear policy should be going forward. There is a range of opinion among the presidential hopefuls, ranging from Barack Obama's pledge to work toward the elimination of nuclear weapons to Sen. John McCain's statement that "it's naive to say that we will never use nuclear weapons." The last Nuclear Posture Review, which articulates U.S. nuclear policy, was completed in 2001 and needs updating.The DOE's push to surge nuclear weapons runs contrary to the positions taken by Henry Kissinger, secretary of state under President Nixon; George Shultz, secretary of state under President Reagan; William Perry, President Clinton's secretary of defense; and Sam Nunn, the former chairman of the Senate Armed Services Committee. This group and dozens of other former foreign policy officials are now championing "the goal of a world free of nuclear weapons" as a "bold initiative consistent with America's moral heritage."But there is a role for civil society as well. This week, posters depicting the devastating consequences of nuclear bombs dropped on the Japanese cities of Hiroshima and Nagasaki will be displayed in the rotunda of the Capitol. Organized by the Hiroshima-Nagasaki A-bomb Exhibition Committee, this weeklong exhibit will conclude with a public hearing at 10 a.m. Saturday, Feb. 16, at the Capitol exploring the role Wisconsin can play in turning Complex Transformation into nuclear disarmament.This and other like-minded efforts raise awareness about nuclear weapons and focus on the goals of stopping the spread of nuclear weapons, ending the pursuit of new warheads, and ensuring the dismantlement of existing stockpiles.Taken together, these steps will encourage the next president to truly relegate nuclear weapons to dim memories and old movies.Frida Berrigan is a senior program associate with the New America Foundation's Arms and Security Initiative, which is a member of the Campaign for a Nuclear Weapons Free World.'

Lees verder: http://www.madison.com/tct/opinion/column/271631%20

The Empire 355

'Lebanon's new proxy force

Matthew Cassel,

Electronic Lebanon

"We don't want a confrontation. But if we are dragged into one, we will not stay [with our] hands tied," warned Parliamentary Majority Leader Sa'ad Hariri during a speech to supporters and journalists in Tripoli on Saturday night. His words to Hizballah and the Lebanese opposition echoed those of top US diplomat to the Middle East David Welch in a letter to Arab League chief Amr Mousa in which he warned that the US would not sit by with its "hands tied" if the current political crises continues.The US, along with its close ally and Lebanon's hostile neighbor, Israel, have long wanted to see the disarmament of the resistance and now political movement Hizballah. This is especially so after Israel's withdrawal from southern Lebanon in 2000 and Israel's failure to militarily defeat the group during the July 2006 war, both widely viewed as Hizballah victories.Hariri, the son of assassinated former Prime Minister Rafiq Hariri, and others in the ruling March 14 coalition, who say Syria and its allies are responsible for the string of bombings and assassinations that have killed more than 100 people in Lebanon over the last three years, have tried to fight off accusations that they are acting on behalf of the US and Israel. However it didn't help their case when, a day after Hariri's speech, Druze leader allied with the March 14 coalition Walid Jumblatt spoke to his supporters using nearly identical rhetoric as the US and Hariri, saying that March 14 would not sit with their "arms folded" waiting for conflict in Lebanon to occur. The "hands tied" and "arms folded" statements suggest coordination between the US and March 14 and their new unified and more aggressive stance towards Hizballah. These statements also indicate that the playing field for Lebanese politics is changing, and fast. The country has been without a president since Emile Lahoud's extended term ended in November 2007, and since then both sides have in principle agreed to a candidate, though they have not agreed on the composition of the government, where the big issue, should Hizballah be included, is whether they will be able to protect their right to bear arms as a resistance movement against any future Israeli aggression in Lebanon. The US and Israel perceive their interests in eliminating and disarming the Shia political party, formed as a resistance movement in the early 1980s soon after the beginning of the 22-year-long Israeli occupation. This was Israel's motivation behind the 2006 war when it tried to defeat Hizballah and cause them to lose popular support but failed to do so. Now, if armed conflict does arise March 14 can also be sure that it will receive US military support like it did during the summer of 2007, when the Lebanese army received US weaponry to help them conduct their battle against extremists in the Nahr al-Bared refugee camp.'

Lees verder: http://electronicintifada.net/v2/article9299.shtml

Het Neoliberale Geloof 94

This is the way the world ends
This is the way the world ends
This is the way the world ends
Not with a bang but a whimper.

The Hollow Men

T.S. Eliot

'ON “THE FAILURE TO APPRECIATE THE GRAVITY” OF OUR ECONOMIC SITUATION

Let me open up today with stories about the economic decline that is already beginning to decimate the lives of so many Americans. I have been writing about this every day and the response has hardly been deafening. Political gossip and minutia seems to have a greater grip on the progressive imagination than tracking the financial collapse. This is a media reform issue too because the coverage remains so sporadic and confusing. The NY Times discovered today as its lead story that the subprime mortgages mess is just one part of a much larger story. That story was reported MONTHS ago in many business publications. I have been saying it for two years. Maybe I am in my own bubble, but it is one that I want to burst.
Michael Moore made his first movie about General Motors. Read about what’s happened to that company and its workers because it went from being an auto manufacturer to a lender. Thousand of workers are being axed.
We are watching the “fall of America,” folks, a slow-motion process that is escalating. I can’t do it justice but I will repeat a quote from last December by a man I am not a big fan of but who nailed it in part as reported just before Xmas on itulip.com
THE FAILURE
First there is the credit bubble. Then there is the credit bubble collapse. Then there is the political haggling as Rome burns. Then there is the Depression. But former Treasury Secretary Lawrence Summers has a plan.He spelled out the problems facing the U.S. economy and proposed solutions in a speech “Risks of Recession, Prospects for Policy” yesterday at The Brookings Institution in Washington, D.C. In summary:
“I am speaking here today because I believe that our current economic situation requires a comprehensive program of measures to contain the fallout from problems in the financial and housing sectors and to assure sufficient policy support for economic growth over the next several years. Perhaps because of a failure to appreciate the gravity of our current situation and the problems our political process has in responding quickly and collaboratively to emergent threats, such a comprehensive program is neither in place nor in immediate prospect.”
NO SUCH PLAN EXISTS READERS—AND NONE OF OUR POLITICAL CANDIDATES IS OFFERING ONE….Here’s the eco
· news on yr dissector’s wire:
AP: WASHINGTON - The federal budget deficit is running at a pace that is more than double last year’s imbalance through the first four months of the budget year.
In its monthly review of the government’s finances, the Treasury Department said Tuesday that the budget was in surplus in January, but totals $87.7 billion so far this budget year, double the $42.2 billion imbalance recorded during the same period in 2007. The new budget year started last Oct. 1.
HOW GENEROUS
NYT: Lenders Offer Plan to Head Off Foreclosures
A group of major mortgage lenders will allow some homeowners facing foreclosure to delay losing their homes for 30 days.
ANALYSIS IN LA TIMES: “Conventional wisdom holds that Wall Street is driven by two emotions: greed and fear. Today we see the second of those — the fear factor — on public display, in the form of the latest effort to forestall foreclosures.
(Headline for those who missed it: “The Bush administration, trying to deal with a worsening housing slump, announced a new initiative today aimed at helping homeowners about to lose their homes. For qualified homeowners, it will put the foreclosure process on hold for 30 days.”)
Banks and lenders are afraid — afraid of a deepening housing crisis, afraid of the political blowback, afraid of writing down more bad loans, and very, very afraid of being stuck owning foreclosed houses that are declining in value every day. The knife is still falling; banks and lenders do not want to catch it……CREDIT CRISIS IS NO LONGER JUST A SUBPRIME PROBLEMFOX BUSINESS NEWS REPORTS: PANIC, PANIC, PANIC
The risk of complete stock market meltdown, a crippling 5000 point nose-dive, is becoming increasingly likely.
The wild swings on Wall Street are becoming increasingly wild and more frequent. The fallout from the sub- prime crisis and slowdown in the economy increase the chances of a genuine economic nightmare.
To prevent the dominos from crashing the Federal Reserve has slashed interest rates by 1.25 percent in just the past two weeks. This means that “Real Interest Rates” are barely positive now. If they go any lower, they’ll be below official inflation rates.
“After inflation is considered, the bank will pay you to borrow its money, instead of the other way around,” says James DiGeorgia, editor of the Gold and Energy Advisor (www.goldandenergyadvisor.com). “Central banks like the Fed don’t do this unless they’re desperate — in panic mode.”
The latest reason for the Fed to panic is that bond insurers are in serious trouble.
“Bond insurers are capable of triggering a chain-reaction meltdown on Wall Street that spreads worldwide,” explains DiGeorgia. “A few years ago, bond insurers like MBIA and Ambac had quiet but profitable businesses. They insured bonds issued by municipalities, state governments, and other large organizations. Since these issuers rarely defaulted, the bond insurers rarely paid out on their policies. But the insurer executives got greedy. So they started insuring riskier bonds — such as mortgage-backed bonds, including subprime debt.”
These bonds are looking increasing fragile. Last Wednesday, Standard & Poor’s downgraded or took negative rating action against 8,000 mortgage bonds and CDOs, worth $534 billion. If only half of those go into default, it will mean $267 billion in losses. This is over two and a half times worse than anything in this crisis thus far.
And, according to estimates, if one or more of the insurers gets downgraded, Wall Street will face an estimated $70 billion in more losses.
“The risk of complete stock market meltdown, a crippling 5000 point nose-dive, is becoming increasingly likely. This would send gold to $2,500, and may even cause sudden 1929-type runs on banks and financial institutions across the country,” cautions DiGeorgia.
The fact that Fox Business Channel is reporting this–given its predeliction to offer “positive” business news is a sign of how serious things are….Billionarire Investor Warren Buffet Offered To Rescue Wall Street From This Crisis By Guaranteeing The Bonds–But At A Stiff Price; Many Fear His Plan Won’t Work; Government Asleep?
WALL ST EXAMINER: PONZI SCHEMES ABOUND'

Lees verder:
http://www.newsdissector.com/blog/2008/02/13/on-the-failure-to-appreciate-the-gravity-of-our-economic-situation/

Paul Brill 2

Eergisteren schreef ik dit over:

'Paul Brill

De atlanticus en politiek commentator van de Volkskrant Paul Brill is ernstig verontrust, zo lees ik in een openingsartikel in zijn krant. Paul wordt dit keer aangekondigd als 'onze verslaggever' en lepelt klakkeloos en zonder context de woorden van de Amerikaanse minister van Defensie Robert Gates op.''‘Tweedeling NAVO zou fataal zijn’Van onze verslaggever Paul Brillgepubliceerd op 11 februari 2008 02:47, bijgewerkt op 11 februari 2008 09:05'

Gisteren nam de NRC een column van de goed ingevoerde William Pfaff over de NAVO met als onderkop: 'Er is al jaren geen sprake meer van gemeenschappelijke opvattingen en belangen.' Pfaff concludeert: 'Er is maar 1 model voor een doelmatig militaire alliantie, en wel dat de groep krachtige gemeenschappelijke opvattingen en grote gemeenschappelijke belangen heeft, en bereid is elkaar te raadplegen en tegemoet te komen. Als die gemeenschappelijke opvattingen ontbreekt, is de alliantie een schijnvertoning. Washington doet in de benadering van Afghnaistan graag of de oude NAVO nog bestaat. Maar die bestaat niet meer. In de zogeheten oorlog tegen de terreur ontbreekt het politieke wezen van een bondgenootschap.' En zo is het maar net. Ideologische commentatoren als Paul Brill beseffen niet dat in de politiek geen vriendschappen bestaan, maar alleen belangen, zoals De Gaulle dat altijd benadrukte. Welnu, de Amerikaanse belangen zijn in sommige gevallen tegengesteld aan die van Europa. De EU vormt een grote economische bedreiging van de VS. Europa heeft geen imperia meer, de Verenigde Staten wel. Europa heeft geen enkel belang in Afghanistan of Irak of waar dan ook waar het Amerikaans imperium verdedigd moet worden. Europa verkoopt niet langer meer het kolonialisme onder de titel dat het de westerse blanke christelijke beschaving verspreidt. De VS moet nu maar een tijdje de white man's burden dragen. Dat Paul Brill dit niet begrijpt is toch opmerkelijk. Het illustreert nog eens hoe diep men in een ideologie kan geloven.

The Empire 354

'Soldier, After Bipolar Treatment and Suicide Attempts, Sent Back to War Zone

The Associated Press

Fort Carson - A Fort Carson soldier who says he was in treatment at Cedar Springs Hospital for bipolar disorder and alcohol abuse was released early and ordered to deploy to the Middle East with the 3rd Brigade Combat Team.
The 28-year-old specialist spent 31 days in Kuwait and was returned to Fort Carson on Dec. 31 after health care professionals in Kuwait concurred that his symptoms met criteria for bipolar disorder and "some paranoia and possible homicidal tendencies," according to e-mails obtained by a Denver newspaper.
The soldier, who asked not to be identified because of the stigma surrounding mental illness and because he will seek employment when he leaves the Army, said he checked himself into Cedar Springs on Nov. 9 or Nov. 10 after he attempted suicide while under the influence of alcohol. He said his treatment was supposed to end Dec. 10, but his commanding officers showed up at the hospital Nov. 29 and ordered him to leave.
"I was pulled out to deploy," said the soldier, who has three years in the Army and has served a tour in Iraq.
Soldiers from Fort Carson and across the country have complained they were sent to combat zones despite medical conditions that should have prevented their deployment.
Late last year, Fort Carson said it sent 79 soldiers who were considered medical "no-gos" overseas. Officials said the soldiers were placed in light-duty jobs and are receiving treatment there. So far, at least six soldiers have been returned.
An e-mail sent Jan. 3 by Capt. Scot Tebo, the brigade surgeon, says the 3rd Brigade Combat Team had "been having issues reaching deployable strength" and that some "borderline" soldiers were sent overseas.
Paul Sullivan, executive director of Veterans for Common Sense, was outraged.
"If he's an inpatient in a hospital, they should have never taken him out. The chain of command needs to be held accountable for this. Washington needs to get involved at the Pentagon to make sure this doesn't happen again.
"First, we had the planeload of wounded, injured and ill being forced back to the war zone. And now we have soldiers forcibly removed from mental hospitals. The level of outrage is off the Richter scale."
The soldier said that on Nov. 29, he was called to the office at Cedar Springs. His squad leader, his platoon leader, his Army Substance Abuse Program counselor and two counselors from Cedar Springs "came and ambushed me."'

Lees verder:
http://www.truthout.org/docs_2006/021108R.shtml Of:
http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_content_id=1003709239

De Israelische Terreur 323

'Olive Trees in “Zion”

"On behalf of the landowners, the Shahadeh family, and the residents of the village of Al-Mashhad, I want to send a message to people everywhere – the Jewish National Fund, to the Nazareth Illit Municipality, to the Members of Knesset and the government, and to the residents of Israel. We don’t want the events of 1976 to repeat themselves, but I have to say that not one meter of land will be taken from us unless we die on our lands. We do not hold any hatred or racist feelings toward anyone. We just want to resolve the matter in a just way. If not, there will be no turning back. We don’t have anywhere else to live or to build our homes. We are a family that makes its living from agriculture and we have no other land to farm. Either we will die or we will live in peace with the neighboring cities without our lands being harmed. I repeat: what happened in 1976 won’t be repeated."
Ramzi Shahadeh,

landowner in Al-Mashhad village'

Lees verder: http://www.arabhra.org/Hra/SecondaryArticles/SecondaryArticlePage.aspx?Language=2&SecondaryArticle=1632