What’s
Wrong Today:

Nothing says “big cajones” like lobbing some bombs on
the people in a smaller country with a leader that the West doesn’t like and that
doesn’t have the military means to strike back directly.  

Remember in
2003, there were massive marches here and in Europe against the Iraq war.

Ten years
later there are no marches. Why? In part the “left”, united against the
Iraq war, is now in large part, lined up behind NATO. It is certainly not
defending Syrians as it was ready to defend, at least via demonstrating, the
Iraqi people.

What makes the current situation more
puzzling is that the lessons of Iraq clearly indicated that the anti-war side was 100% right.
The US and the pro-US governments in Europe were lying about WMD. The
casualties were horrendous, amounting to hundreds of thousands dead, wounded
and driven into refugee status. The net result was chaos, a continuing and bloody civil
strife, disease, poverty and waste.

The Coalition of the Willing led to the Four
Horsemen.

In the
past decade, the global economy has collapsed. It may collapse again; living
standards are falling everywhere. By any rational accounting, the governments
of Obama, Cameron and Hollande should be slouching towards political oblivion.
Instead they propose, even as they do nothing to spur employment while they cut unemployment benefits and pensions,
to splurge more billions on more killings, this time of Syrian civilians.

Everyone knows what is going on here: Kerry reprises Powell,
Rice reprises Rice and Obama reprises George 47.

We just can’t get enough of it. And in National News: Miley
Cyrus?

 

“Conquest
after conquest, deeper and deeper into molasses…Flies conquer the flypaper. Flies
capture two hundred miles of new flypaper.” (Lt. Tonder in The
Moon is Down) – John Steinbeck

What’s
Wrong Today:

50 years after the
March on Washington, we are proposing yet again to spend $billions to bomb another distant country, but
we still can’t muster the will to lift a third of our own nation out of
destitution and despair.

So the US MUST attack Syria because the
administration says that it has “credible evidence” that the Syrian government
used chemical weapons. The reasoning is that using chemical weapons is so wrong, and we need to protect
the Syrian people.

Don’t ask
Congress to authorize it, because this is a dire emergency! Our politicians and
media prefer fake reasons for war, reasons that they can change to fit the
needs of the moment.

The media
spends more time scripting than reporting. It’s insulting that our leaders
can’t be bothered to offer facts for their justification for war anymore. It’s all
so predictable.

From Andrew
Bracevich:

Bracevich suggests
that before ordering any such action, President Obama should answer three
questions, and share his answers with the American people, before, not after,
pulling the trigger. Here are Bracevich’s questions:

First, why does this
particular heinous act rise to the level of justifying a military response? Why
did a similarly heinous act by the Egyptian army elicit from Washington only
the mildest response? Why the double standard?

Second, once US
military action against Syria begins, when will it end? What is the political
objective? What exactly does the United States intend to achieve and how much
is President Obama willing to spend in lives and treasure to get there?

Third, what is the
legal basis for military action? Neither Russia nor China is likely to agree to
an attack on Syria, so authorization by the UN Security Council won’t be
forthcoming. Will Obama ask Congress for the authority to act? Or will he, as
so many of his recent predecessors have done, employ some dodge to circumvent
the Constitution? What is his justification for that?

Booman describes the flawed strategy
of what he calls the “Do Something Caucus”:

He goes on:

The Obama administration
seems to be making a bad choice between two poker strategies: the “Know when to
fold ‘em” strategy seems to have lost out to the “all-in” strategy.

Mr. Obama started
with a bad mistake with his “Red Line” comments. You don’t want to get involved
in a civil war that will harm our national interests, but you don’t want people
to be killed with chemical weapons, either. So, you talk tough to try to
prevent the use of chemical weapons. It didn’t work.

Also talking
tough was your Senator from the Green Room, (John McCain R-AZ) appearing yet
again on the Sunday shows, who said:

But the world
understands that at best, we hold a pair of deuces in Syria. We are also holding
a pair of deuces with regard to Iran’s nuclear program.  One is a problem we can’t fix, and the other
we might still be able to work on, provided we don’t get in the middle of their relationship with Syria’s al-Assad.  

First, we
need to admit that as of today, there
is no outcome that we want in Syria, so success is an impossibility. Second, once we start
bombing, we will be sucked into choosing an outcome that we don’t want and then
pursuing it until the American public punishes the Obama administration for simply
being idiots.  

When the
best the administration can come up with is “This won’t work, it will
probably make things worse, but we have to do it because…” it doesn’t
really matter how you end that sentence. The administration is choosing to end
it with “we have to maintain the taboo on chemical weapons”. 

Fine. But
you could end it with any other conceivable phrase and the logic does not
improve.  

If the United States enters this civil war on the
side of the opposition in Syria, the
United States will be blamed for the opposition’s crimes, and they have already committed
many. Most people in the greater middle east hate al Qaeda and other
terrorists. They are also coming to hate the United States and its drones,
missiles, bases, night raids, lies, and hypocrisy. 

Imagine
the levels of hatred that will be reached when al Qaeda and the United States
team up to overthrow the government of Syria and create an Iraq-like hell in its
place.

An unpopular rebellion put into power by an outside force
(US) does not usually result in a stable government. In fact, there is not yet on record
a case of US humanitarian war benefiting humanity or of nation-building
actually building a nation, and don’t bring up Croatia as the model for Syria. 

Why would Syria, which looks
even less auspicious than other potential targets, be the exception to the
rule?

What’s
Wrong Today:

Ben
Bernanke will step down at the end of his second term as Chairman of the
Federal Reserve (“FRB”) in January, 2014. There is much speculation regarding who
will be his successor. The two top contenders are FRB Vice Chair Janet Yellen
and former Treasury Secretary Lawrence Summers. So there’s a horse race underway
in Washington.

The next Fed chair
will have enormous power and influence over our entire financial system and the
direction of the economy. The Chair is also a key regulator of financial
institutions.

Sen.
Bernie Sanders (I-VT) and Sen. Elizabeth Warren (D-MA) are planning to ask four questions of the two FRB candidates.
The questions seem targeted at Larry Summers, who was a key player in
dismantling Glass-Steagall and deregulating derivatives,
both of which helped fuel the financial crisis of 2008.

Question
1:
Do you believe that the Fed’s top priority should be to fulfill its full
employment mandate?

Question
2:
If you were to be confirmed as Chair of the Fed, would you work to break up
“too-big-to-fail” financial institutions so that they could no longer
pose a catastrophic risk to the economy?

(The
background here is that the too-big-to-fail (TBTF) banks played a major role in
undermining the economy and driving our country into the Great Recession.
 Yet today the four biggest banks are 30% bigger than they were then, and the six
largest financial institutions now have assets equivalent to two-thirds of our GDP).   

Question
3:
Do you believe that the deregulation of Wall Street, including the repeal of
the Glass-Steagall Act and exempting derivatives from regulation, significantly
contributed to the worst financial crisis since the Great Depression?

Question
4:
What would you do to divert the $2 trillion in excess reserves that financial
institutions have parked at the Fed into more productive purposes, such as
helping small- and medium-sized businesses create jobs?

(Background:
Five years ago, the Fed bailed out the largest financial institutions in the
country by injecting huge amounts of cash into them, but put no restrictions on
how they could use the funds. The banks simply deposited those funds back at
the Fed as excess reserves. The Fed has been paying interest on those excess
reserves, and that gives no-risk profits to the banks. So, their question is how
the next Fed Chair can promote more lending by the TBTF banks).

Who knows whether
any candidate will ever answer these questions. It would be illuminating if
they did.  

For many
liberals, Summers is this season’s chew toy: There is petition demanding that Mr.
Obama not appoint Mr. Summers and it has almost 100,000 signatures. 20 Senators,
about a third of Democrats in the Senate, wrote
a letter
suggesting he nominate Ms. Yellen.

Summers supporters include most
of Mr. Obama’s economic team: Director of the National Economic Council Gene
Sperling, Chair of the president’s Council of Economic Advisers Jason Furman,
director of the White House OMB Sylvia Burwell and Treasury Secretary Jack Lew.
The
Center for American Progress (CAP), a liberal think
tank allied with corporate Democrats, is pushing
for Summers.
Former Treasury Secretary Tim Geithner helped
Summers plan his campaign for the job during a private strategy call.

Ms.
Yellen has far less support from White House insiders. Christina Romer, a
former chairman of the Council of Economic Advisers encouraged her former
colleagues in the White House to introduce Yellen to a wider range of Obama
aides, but little came of it. WaPo reports that WH logs show that Yellen visited the White House only once over the past 2 ½
years, compared to 15 times by Summers.

Yves Smith
hypothesizes that Mr. Obama will
nominate Summers since he is a friend of Wall Street and deregulation. That
faction has the right combination of pedigree and influence to help Mr. Obama
in his post-presidential career. There is no point in alienating a group of
your soon-to-be-future loyal backers if you don’t need to.

So, backing
Summers may just be a no-lose proposition for Mr. Obama. There is no personal
upside for him to support Ms. Yellen. Most critics, like Felix Salmon at Reuters, focus on Summers’s
fealty to financial firms and the near-certainty that he’ll continue to
strongly favor deregulation.

So let’s
unpack Mr. Summers and his role in deregulation. In 1999, while he was Director
of the National Economic Council for Mr. Clinton, Summers endorsed the Gramm-Leach-Bliley
Act that ended Glass-Steagall and removed the separation between investment
and commercial bank activities, saying:

He
continued:

Mr. Obama,
among others, has suggested the 2007 subprime mortgage financial crisis was
caused in part by the repeal of the 1933 Glass–Steagall Act.

Summers also
had a major role in turning back a proposal to regulate the financial derivatives
market. In 1998, then-Deputy Secretary of the Treasury Summers testified
before the US Congress:

Summers and
former FRB Chair Alan Greenspan worked together to oppose regulating
derivatives. More from his testimony:

After the
big derivatives fail, Mr. Summers flip-flopped, saying to
George Stephanopoulos:

The
fact that Summers played a key role in enabling AIG and other financial
institutions to sell derivatives without regulation was beyond ironic. In 2010,
Mr. Clinton said
that Summers’s
advice that the president not regulate derivatives was wrong.

Ironically,
Summers later had a reverse Midas
touch with derivatives during his tenure as president of Harvard. The University placed
contracts totaling $3.52 billion of derivatives called interest rate swaps. By late 2008, those
positions had lost approximately $1 billion in value. This decision has been called
by Felix
Salmon of Reuters, a “massive interest-rate gamble” that ended very
badly.

Mr.
Summers had a disastrous tenure as Harvard president, beyond the losses, he
demonstrated the lack of a basic ethical compass in refusing to discipline a
colleague over egregious and politically damaging mismanagement of a Harvard consulting
contract with Russia. He sparked controversy in a discussion of why women are
underrepresented in tenured positions in science and engineering that led to
accusations of sexism. He fought with Dr. Cornel West, an African-American member
of the faculty saying that Dr. West contributed to grade inflation. That led to
accusations of racial insensitivity on Summers’s part.

He lost a
vote of no confidence by the Faculty of Arts and Sciences, and eventually
resigned in February 2008. He had served from 2001-2008. He got a $1 million
loan and tenure on the faculty as part of his good-bye kiss.

All
of this suggests that the #1 Question for Larry Summers should be: If you couldn’t succeed at the best job
in the world, president of Harvard, why will you be able to succeed as Chair of
the Federal Reserve?

He is another required quota hire. We obviously have a critical shortage of
white, male Wall Street-affiliated fuck-ups in Washington.

So, all aboard the Summers Express to DC.

What’s
Wrong Today:

Yesterday
the Wrongologist reported
on the militarization of local police departments. The equipment that enables
that trend is provided by the Federal Government, primarily via a DHS grant program that allows
police departments to purchase military-style equipment:

Today,
we examine the civil forfeiture element of that program which is used as a funds-raising
tool by the Feds as well as municipalities and police departments around
America. Sarah Stillman has written a detailed, must-read New Yorker story that describes
civil forfeiture today.

Forfeiture
in its current form began with federal statutes enacted in the 1970’s. It was
part of the war on drugs and was aimed at organized-crime bosses and drug
lords. Law-enforcement officers were empowered to seize money and goods tied to
the production of illegal drugs. Later amendments allowed the seizure of
anything thought to have been purchased with ill-gotten funds, whether or not
it was connected to the commission of a crime. Forfeiture remained infrequently
used until 1984, when Congress passed the Comprehensive Crime Control Act
(CCCA). It established a special fund that turned over proceeds from
forfeitures to the law-enforcement agencies responsible for them.

Civil
forfeitures are now a big revenue generator for police departments in many
areas of the country. As Stillman’s article records, in some places, such as a stretch of road in Tenaha, a town in Shelby
County Texas that is the cornerstone of her article, civil forfeiture is a
mechanism for local cops to separate people with out-of-state or rental license
plates from their jewelry and cash. In other places, cars and even homes are
the objects of the official seizures.

As
Stillman explains:

In
general, the law says that you don’t have to be found guilty to have your
assets claimed by law enforcement; in some states, suspicion on a par with
“probable cause” is sufficient. Nor must you be charged with a crime, or even
be accused of one. Unlike criminal forfeiture, which requires that a person be
convicted of an offense before his or her property is confiscated, civil forfeiture amounts to a lawsuit
filed directly against a possession, regardless of its owner’s guilt or
innocence. From Stillman:

Whether
in the absence of finding guilt, the state should be able to take possession of
your property, has been debated since Colonial times. The English Crown issued
“writs of assistance” that permitted customs officials to enter homes or
vessels and seize whatever they deemed contraband. The new nation’s Bill of
Rights forbid “unreasonable searches and seizures” and promised that no one
would be deprived of “life, liberty, or
property, without due process.”

But,
Congress soon authorized the use of civil-forfeiture against pirates and
smugglers. It was easier to arrest a vessel and seize its cargo than to try to
prosecute its owner, who might be an ocean away.

In
the ensuing decades, the practice fell into disuse and aside from a few brief
revivals, remained mostly dormant for the next two centuries, but now, you see improbable
case names such as United States v. Approximately 64,695 Pounds of Shark Fins.

This is
where civil forfeiture started going off the rails. Stillman details a
mind-numbing number of appalling stories, including a minister having cash from
collections taken, and a couple carrying cash to buy a used car who, when
pulled over, were threatened with felony charges and having their kids placed
in foster care unless they signed over their cash. Often, it’s hard for people
to fight back. They are too poor; their immigration status is in question; they
just can’t sustain the burden of taking on local bureaucracies.

Forfeiture
revenues have been staggering. While there are no accurate state level statistics,
at the Justice Department, proceeds from forfeiture soared from $27 million in 1985 to nearly $4.2 billion last year.
And don’t kid yourself that this practice is about stopping big criminals:
(emphasis by the Wrongologist)

And
Stillman shows that civil forfeiture statutes continue to proliferate at the
state and local level, and controls have often been lax. Many states, facing
fiscal crises, have expanded use of their forfeiture statutes, and made it easier
for law enforcement to spend the revenue however they see fit. In some Texas
counties, nearly 40% of police budgets come from forfeiture. (Only one state,
North Carolina, bans the practice, requiring a criminal conviction before a
person’s property can be seized.)

The worst
is that there’s no ready defense against this sort of thing, except not living
or vacationing in states that allow police to grab and keep the property of
people they think they can get away with victimizing. The case that Stillman
uses as the backbone of her story was fought for years before a settlement was reached with
the town.

You should
read Stillman’s
piece in full. And don’t even think of driving in East Texas.

Most
politicians love the police and run on being tough on crime. Civil forfeiture
will not be “reformed” except by recognizing that the 4th Amendment prohibits
seizing property absent criminal charges. That isn’t going to happen.

Then
there is the 5th Amendment, the one that says “No person shall be …
deprived of life, liberty, or property, without due process of law…”

Time to
wake up and admit that there’s been an unseen coup d’état in this country. We need to forge a new consensus around supporting
the entire Bill of Rights.

You have
been warned, comrade.

What’s
Wrong Today:

The
Wrongologist likes the Wall Street
Journal’s Weekend edition; it is one of the better newspapers in America.
Sadly, you can’t say that about the Monday-Friday edition of the WSJ, which is largely a
yellow-journalism rag.

The
Weekend edition has weaknesses that reflect its weekday roots, like this article:
Bye
to Uncle Sam? which talks about the “flight” of Americans to renounce ties
to the US for tax reasons. The headline must be 48pts and boldface. The issue
is um, tiny. Turns out the “flight” was 1800 people in the 1st half
of 2013. But for those members of the 1% thinking of moving abroad to pay fewer
taxes, the Journal included a handy
guide to help avoid the taxman.

This
weekend, they also ran an article about Russell Moore, the incoming president
of the Southern Baptist Conventions’ Ethics and Religious Liberty Commission.
He is replacing Richard Land, who told NPR
in 2010 that Mormonism was “not a Christian faith”.  

Mr. Moore,
however, may be a different breed of cat. In the article,
Moore says he is decidedly not a
fan of the “values voter checklists” of the Moral Majority:
“There is no Christian position on the line-item veto,” Mr. Moore
says. “There is no Christian position on the balanced-budget
amendment.” Mr. Moore wants to refocus the movement on serving as a
religious example battling in the public square on “three core
issues”—life, marriage and religious liberty.

Why? Because “we
are no longer the moral majority. We are a prophetic minority.” Naomi
Schaefer Riley, WSJ’s religion writer:

Let’s unpack whether
Mr. Moore is a different breed of cat.

By “prophetic
minority,” he means that Christians must return to the days when they were
a moral example and vanguard—defenders of belief in a larger unbelieving
culture. He views this less as a defeat than as an opportunity.

As a “prophetic
minority,” Mr. Moore thinks his most profound political task will be defending religious liberty from the
assaults of a secular government. This cause is at the heart of his
plan to fight the contraception mandate in ObamaCare. Mr. Moore sees this as a
chance to unite believers of many faiths, and last month he joined Archbishop
William Lori of the US Conference of Catholic Bishops and other religious
leaders in writing to Mr. Obama: “HHS (The Housing and Human Services
Administration) policy is coercive and puts the administration in the position
of defining—or casting aside—religious doctrine. This should trouble every
American.”

Mr.
Moore says he hopes to make the ObamaCare mandate a major issue in the 2016
election. By then, it will have become clear how intrusive the health-care law
has become, he says, and the American people will side with religious groups
that protest having to act against their beliefs. “The separation of
church and state,” Mr. Moore says, “is not a liberal issue.”

So, over the past decade, Southern
Baptists have gone from “We’re the moral majority because this will always
be a Christian nation” to “If you are a true Christian, you will
fight this battle with us because America has lost its way”.

If it seems odd that the Christian majority in the
US is suddenly acting like an aggrieved minority, you’ve not been paying
attention to the Religious Right’s shell game in the age of Obama.

It’s also worth remembering that
the Southern Baptists are the same group that fought against the Civil Rights
movement in the 1950’s and 1960’s.

With the Supreme
Court’s decisions on gay marriage in June, Mr. Moore sent a message to pastors
to help them talk with their congregants about the Southern Baptist opposition
to the law. “We don’t hate our gay and lesbian neighbors,” he says,
but redefining marriage on their behalf is another matter.

From the article: (emphasis
by the Wrongologist)

Moore is calling evangelicals to arms against the
rest of us. His prophetic minority strategy offers Christians a moral high
ground since they are being “persecuted” for their beliefs by a
country that increasingly doesn’t buy into their intolerance towards LGBT
Americans, women, other religions, secular Americans, and even more liberal,
inclusive Christians. 

From Mr. Moore’s viewpoint,
Southern Baptists and the larger evangelical Christian community are a minority.
That is how they plan to play it, and here’s their political strategy: 

• Everything
  that the Obama administration is doing is an “assault on the religious
  liberty” of those who say they are unfairly being persecuted for their
  proud intolerance
  

• The
  government cannot tell them to do anything that they don’t believe they should
  have to do

• Decades
  of jurisprudence would say otherwise, but the basic plan is everything they don’t like now
  violates the First Amendment’s freedom of religion clause, and
  they will act accordingly.

Evangelical Christians have a management problem. As a management consultant
might put it: Few barriers to entry creates problems of credibility. No
Evangelical Executive Committee exists to review opinions, discipline or
excommunicate a franchise holder. With no institutional regulatory framework,
preachers can tell teens to pray over used clothing to get out the demons,
refuse to have faith healing claims evaluated by neutral observers, blame
natural disasters on human behavior, continue to insist the world is 4,000
years old, fleece the faithful by selling prosperity shawls that claim to bring
vast wealth, and call for foreign leaders to be killed.

Until a structure is put in place to define and
oversee an acceptable theology and world view that is part of the modern age, evangelical
Christians will continue to look more and more like a cult, one step above Scientology.

Christianity was a quality product, then came
organization, then institutionalization, then, worship of the institution,
then, blindness to faults.

So stand
tall, all of you Christian anti-choicers, homobigots, and Teavangelicals. 

Your
right to shame, persecute, and harass those outside of your beliefs will be
fought tooth and nail by Mr. Moore,
who believes it is the duty of the State to protect you from (his definition)
of sin.

He really isn’t
a different breed of cat.

This Sunday’s
meditation is from Woody Allen. Construct your own homily from his thought.

The happy
couple hears it from the crowd:

Concept for
an Ultra High Speed Train revealed by Elon Musk:

There’s
talk about building Hyper-Fast trains. Well, we already built one, the one to
massive income disparity, and it doesn’t stop at your station. Once we got on
board with the idea that riches were the new American Value, and laid the
tracks by which a few could get themselves there, the destination was pre-ordained.
We could look back and wonder. Or look forward and wonder.

Republicans
meet with their hometown Teahadists:

Putin
says he’s cool with Gays:

North
Carolina’s new voting law requires photo ID and cuts early voting days in
half:

What’s
Wrong Today:

It is time
to connect the dots. Growing up in the 50’s, 60’s, 70’s or 80’s, there was a
sense of structure and basic decency. Add the fact that working hard
would lead to a better life most of the time. Dad (and sometimes Mom) went to
work, earned a livable wage and supported a family. Junior and sis went to
college got an affordable education and a job relevant to that education. It
was what was expected and it was what happened for the vast majority of the
middle class.

Today that
livable wage comes from two jobs if it comes at all. Maybe three or four jobs if
Mom works too. The structure of a decent wage for a decent living is gone.

What used
to be the common decency of looking out for your fellow man is becoming a
rarity today. Now, austerity is the word. Cut back on food stamps, don’t give the
unemployed so much money. The rich shouldn’t pay high taxes. Pay fees for extracurricular activities in school. All of these
schemes were on the political fringe 30, 40, or 50 years ago. Now they are
mainstream. In many states, they are a political necessity in order to win
elections.

The idea
that a corrupt politician or a corrupt business person who is caught cheating
or stealing would be brought to justice is no longer a given today. How many banksters have gone to prison?

Everybody
has their own thoughts and dreams about what things would be like if…

• What
  would it be like if Marshall law was declared on a major US city? Pretty much
  what Boston was like after the marathon bombing.

• What
  would it be like if an American political party ran roughshod over their
  opponents and did what they pleased? Look at several of our state legislatures
  where one party controls the state house and legislature.

• What
  would it be like if politicians were not held accountable for their actions and
  could do what they pleased with little accountability? Check out the 113th
  Congress’s dismal record on passing legislation.

Back up a
few years and it would be difficult to imagine any of these scenarios happening
in America, unless you were a novelist.

It isn’t just
that the economic rights of ordinary workers and the social safety nets of the
New Deal and the labor movements are being demolished. Major elements of the
broad social and political contract that has served as the foundation for this
country are being torn apart: the fraud statutes (essential to give people of
every level of society decent protection of property rights) and access to
legal remedies; basic protection of personal rights (habeas corpus, due
process, protection against unlawful search and seizure); militarized local policing. Decent quality public
education and the freedom of the press are both under assault.

If you haven’t
read it yet, check out the New York Times’ Sunday
magazine cover story on Laura Poitras. It discusses in detail how routine
communications on the web are simply not secure and depicted the considerable
measures Snowden, Greenwald, and Poitras took (and by implication, ordinary
people ought to be taking) to keep their discussion secret.

And we
have the drip, drip, drip of ongoing revelations such as “mistaken”
surveillance of thousands of ordinary Americans (and you can bet a lot more are
dressed up as legit).

Is Mr.
Obama losing some of his famous cool?  It
may simply be a coincidence of timing but he’s been visibly heavy handed of
late. Consider the following:  

• Delaying
  Rep. Grayson’s (D-FL) hearing with Glen Greenwald (Snowden’s reporter) which
  will happen in September. (What sort of victory was it to push it into a
  busier news period?)

• Getting
  snippy in the Democratic caucus meeting when asked about Larry Summers (Candidate for Fed. Reserve Board Chair) and
  later calling senators who opposed Summers to his office to tell them to lay
  off

• Launching
  a speaking tour on how he’s creating middle class jobs (which seems to be
  landing like a lead balloon)

• Launching
  a faux independent surveillance investigation (having Clapper on the committee
  is tantamount to saying, “So what are you going to do? Impeach me?”)

• Being
  wrong-footed on Morsi and the Egyptian military

• Ending
  the Summit with Putin on a whim

Shorter: Mr.
Obama looks slightly off balance.

Add to
that, we have municipal bankruptcies and restructurings,
which returns to the headlines the war against municipal workers and unions, while
creating another looting opportunity for Wall Street. See today’s NYT editorial,
“No Banker Left Behind”.

Back to
the Wrongologist’s post of yesterday,
there has been a full court press in the MSM to talk up/trumpet any financial
indicators (housing/retail etc) no matter how weak to show that there is a
recovery. They are frantically trying to paper over the cracks that are getting
wider every day.

As the
Wrongologist’s Georgetown Professor said:

Connect the dots…We are not drawing a
line through a random set of data points. It feels different this time. There
are too many bad things going on at once:

 

1. The banks have not
been reformed and never will be

2. The National
Security State will not be reformed absent a revolution

3. Our civil liberties
are eroding at an exponentially-increasing rate (Habeas Corpus, NSA, police
militarization, due process, Section 4 of the Voting Rights act)

4. The government is
now not even trying to hide that they will lie about everything and hold the
people in contempt, e.g., appointing proven liar (Clapper) to “review” the
Security State’s practice

5. The worst
environmental disaster in history (Fukushima core meltdown) awaits the next 9.0 earthquake.

 

This is not going to be fun. Isn’t it
ironic that the generation that fought “The Man” is worse, in some ways, than The
Man was?

Boomers: What’s
important is how one ends – a good beginning is not sufficient.

“As nightfall does not come at once,
neither does oppression. In both instances, there is a twilight when everything
remains seemingly unchanged. And it is in such twilight that we all must be
most aware of change in the air–however slight–lest we become unwitting victims
of the darkness.” – William O. Douglas

What’s
Wrong Today:

Here are two charts that describe the current state of consumer credit in the US.
Both come from Marketwatch.
The first chart shows the change quarter-to-quarter in loan delinquencies by type of loan. The left axis is $Billions. CC means credit card debt, HELOC means home equity lines of credit.

Wow and wow again. This one chart illustrates the magnitude of the Debt Crisis and
the Great Recession. Clearly, delinquencies were driven by the mortgage market.
To a great degree, this demonstrates the origins, and the culprits of the crisis. It was not profligate consumers, it is not feckless students; the students are pikers compared to the bankers. And it is not over.

Almost an entire generation’s worth of debt! By the time this graph reaches the
pre-crisis baseline, it looks like about 15-20 years of excess defaulted debt will have occurred! It is no surprise that many people are having to use CreditAssociates and similar companies to help them deal with their debt when you look at this. It is a frightening reality.

The chart below shows the % of loans that have entered delinquency. Most financial institutions declare loans that are past due by 90 days “delinquent”. The chart indicates that fewer Americans are getting into trouble with their debt, though the percentage of late loans is still higher than pre-recession levels. During the second quarter, every category of loan showed declining percentages of debt, although student loan delinquencies spiked much later than the other categories, and may decline more slowly.

So,
some parts of the economy suck less than they did last year.

This is what is
meant by the Soft Bigotry of Low Expectations.
This term was first used by George W. Bush in a speech to the NAACP in July, 2000.
He meant that we give extra consideration to individuals or groups that are considered lacking in some way. It was a bad idea then and it remains a bad idea today.

Bush was talking about educational standards, but the term as used here means that we have come to expect less from the economy than we have in the past, and that we now celebrate small
gains, like those shown in the charts above.

Think about jobs: Of the 161,000 reported private sector jobs gained in July, 157,000 or 97.5%, are in non-tradable domestic services. A non-tradable service is a job that produces services that cannot be offshored, such as waitresses, bartenders, hospital orderlies, retail clerks, warehousemen. Thus, no matter how large the new jobs number might be, it will not help reduce the US trade deficit.

Many of these jobs are part-time jobs without health or pension benefits. Many of these jobs do not produce sufficient income to drive a consumer economy.

Manufacturing
and tradable professional service jobs such as software engineering have been moved offshore to lower wage, lower-salary locations.  The savings in labor costs have enriched corporate executives, Wall Street, and shareholders.

Erica Groshen
is the Commissioner of Labor Statistics and head of the U.S. Bureau of Labor
Statistics (BLS), the department that produces the jobs report. The
commissioner’s statement
accompanying the jobs report, acknowledges that 8,200,000 or 6% of the currently employed are “involuntary part-time
workers” who cannot find full-time employment.

The July
2013 payroll employment level of 136,038,000 is 2,018,000 below the employment level in January 2008, which
was 5 years and 7 months ago.

If it
requires 130,000 new jobs each month to keep employment equal with population
growth, the US economy is behind by 10,728,000 jobs. These missing jobs show up
in the declining labor force participation rate, the part-time workers who can’t find full-time work, and the large number of
discouraged workers who are no longer counted as unemployed.

Obviously,
for job-seekers, there has been no economic recovery.

Soft Bigotry of Low Expectations indeed!!

What’s
Wrong Today:

Sometimes
it is difficult not to be dismayed at Mr. Obama’s conduct of foreign policy.
Gore Vidal once described George W. Bush as “eerily inept.” If Mr.
Vidal alive today, he’d probably be trying to improve upon that epithet while
applying it to Mr. Obama.

The Obama administration was miffed by
Russia giving temporary asylum to Edward Snowden and has decided to
“punish” the Russian Federation and its President Vladimir Putin by cancelling the bilateral summit
with Russian President Vladimir Putin in Moscow that was to coincide with the
Group of 20 meeting in St Petersburg in early September.

A New
York Times report on the Summit mentions several
“issues” the US has with Russia. These are the
Snowden case, the war on Syria, Iran’s (non?) existing nuclear weapons program
and nuclear disarmament. This
is getting ridiculous: The President wanted his spy Edward Snowden back. Snowden,
following Russian law, has been granted temporary asylum. The White House is “disappointed”.
But many Americans
are not wholly on the side of their government in the Snowden affair. Consider this
letter to the NYT editor by Mark Thomason of Clawson, MI:

The
NSA is the only government entity listening to the people on all of the issues mentioned
by Mr. Thomason; certainly it isn’t Mr. Obama.  

Russia
is calibrating its support for Bashar al-Assad in Syria, despite our Saudi ally’s intelligence
chief, Prince Bandar bin Sultan’s visit to Moscow during which, according to Reuters,
he apparently offered to buy Russian weapons as long as Russia backed off on
supporting al-Assad. However, Russia continues its support.

In
the Caucasus, Russia is improving its position: Georgia is way less
antagonistic towards Moscow. Russia influenced Azerbaijan’s decision to choose
the Trans-Adriatic Pipeline (TAP) and immediately moved to solidify energy
cooperation between Azerbaijan’s SOCAR and Russia’s Rosneft. Both Georgia and
Azerbaijan are considered as proverbial “staunch” US allies.


In Europe, Germany and Russia have 80 Billion Euros in bi-lateral trade, but frosty political relations, while Russia
continues negotiations on natural gas deals with Italy, France and Poland. Russia is moving to secure long-term contracts with plenty of price
breaks and tax schemes.


In Central and Eastern Europe, Russia is buying scores of strategic
manufacturing, chemical and transport assets.


Then there’s the crucial Trans-Siberian gambit. Nowadays, the train line is all about heavy
cargo. The Trans-Siberian moves 120 million tons of cargo a year, 13%
of the container trade between Europe and Asia. Russia is investing in a US$17
billion expansion
and adding 55 million extra tons of cargo capacity.


It is tripling the capacity of Russia’s Pacific coast terminals by 2020; for the
expansion of St Petersburg’s port, Siemens is supplying 675 extra cargo
electric locomotives as part of a $3.2 billion deal.


The name of the game is Russia increasing its exports of raw commodities by
all means available. At least 250,000 barrels of oil a day move from Russia to
Asia. The upgraded Trans-Siberian will do wonders for Europe-Asia trade. Via
the Trans-Siberian, Asian products reach Europe in 15 days; by sea, from South
Korea or Japan, it’s 30-40 days to Germany. This makes Japan and South
Korea huge Trans-Siberian fans. And from a European point of view, nothing
beats the cheaper, faster Trans-Siberian way to Asia. Consider this from Pepe Escobar:

That
leaves ol’ Vladimir free to construct a new strategic reality not only in
Europe’s periphery but at its core as well. Russia is back – with a bang, while Mr. Obama sleeps.


Despite the fact that the US and Russia are mutually dependent on a vast array
of issues, the New York Times posted an editorial
justifying the cancellation of the summit:

It
is amazing to see the Times’ editorial board’s opinion demonstrate how the main
stream media can’t grasp the totality of the Russian worldview, or their true economic
threat to the US. The Obama administration focuses on missile defense, Iran and
Syria. Russia focuses on pipelines and rail cargo transit that is faster and
cheaper than sea transit.

The
cluelessness of the Obama administration and the Beltway think tanks cannot be
overemphasized. Nobody inside the Beltway has articulated a sound Russian
policy – apart from demonizing Putin, which is precisely what Sen.
John McCain did last Sunday on Fox News, saying that he looked into Putin’s
eyes and “saw three letters: a K, a G and a B.”

It was amazing to see
how quickly George W. Bush weakened US influence in the world. It is unbelievable
that Mr. Obama is on track to accomplish just as much in this area as Mr. Bush
did.