Demeter
Demeter's JournalChoose your own fiscal cliff adventure!
http://www.washingtonpost.com/blogs/wonkblog/wp/2012/12/20/choose-your-own-fiscal-cliff-adventure/If the United States goes over the so-called “fiscal cliff,” allowing a wave of scheduled tax hikes and spending cuts to take effect Jan. 1, the nation would likely enter a recession as the deficit falls too far, too fast. How would you avert the cliff, though?
Your job, should you choose to accept it, is to figure out a path forward using this calculator. First, identify which aspects of the fiscal cliff’s tax increases and spending cuts you would allow to go forward, and which you would cancel. Then, pair it with other deficit-reduction policies you want to enact to start bringing deficits down even without the pain of an immediate austerity crisis. Then, add in any stimulus measures you might want to cushion the blow of deficit reduction and try to get the economy on track.
Once you have your plan for resolving the fiscal cliff, be sure to share it with your friends on Facebook and Twitter. Who knows, maybe Boehner and Obama are listening...
IT'S AN INTERACTIVE GAME!
Anti-Charisma Strikes Again
It's amazing how little response the nomination of Kerry for Sec. of State is generating...
Why Malthus Got His Forecast Wrong
Most of us have heard that Thomas Malthus made a forecast in 1798 that the world would run short of food, and that great famine would result. But most of us don’t understand why he was wrong. This issue is relevant today, as we grapple with the issues of world hunger and of oil consumption that is not growing as rapidly as consumers would like–certainly it is not keeping oil prices down to historic levels.
What Malthus Didn’t Anticipate
Malthus was writing immediately before fossil fuel use started to ramp up.
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The availability of coal allowed more and better metal products (such as metal plows, barbed wire fences, and trains for long distance transport). These and other inventions allowed the number of farmers to decrease at the same time the amount of food produced (per farmer and in total) rose. On a per capita basis, energy consumption rose (Figure 2) allowing farmers and others more efficient ways of growing crops and manufacturing goods.
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If it hadn’t been for the fossil fuel ramp up, starting first with coal, Malthus might in fact have been right. As it was, population was able to ramp up quickly after the addition of fossil fuels.
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A person can see that there was a particularly steep rise in population, right after World War II, in the 1950s and 1960s (Figure 3). This is when oil consumption mushroomed (Figure 2, above), and when oil enabled better transport of crops to market, use of tractors and other farm equipment, and medical advances such as antibiotics...It is likely that increased consumer and business debt following World War II (Figure 4) also played a role in the post-World War II ramp up.
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The reason I say that debt likely played a role in this ramp is because at the end of World War II, people were, on average, pretty poor. The United States had recently been through the Depression. Many were soldiers coming back from war, without jobs. Without a ramp up in factory work and related employment, many would be unemployed. A ramp up in debt fixed several problems at once:
The debt ramp up, and the resulting increase in oil production, raised living standards. Figure 2 shows that the increase in per capita energy consumption was far greater in the 1950 to 1970 period when oil production was ramped up than in the coal ramp-up between 1840 and 1920. The long coal ramp-up period does not appear to have been accompanied by such a big ramp-up in debt...
READ ON FOR THE FORECAST FOR OUR FUTURE...
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About Gail Tverberg
My name is Gail Tverberg. I am an actuary interested in finite world issues - oil depletion, natural gas depletion, water shortages, and climate change. The financial system is also likely to be affected.
How Coal Brought Us Democracy, and Oil Ended It: Lessons from the New Book “Carbon Democracy”
http://www.nakedcapitalism.com/2012/09/how-coal-brought-us-democracy-and-oil-ended-it-lessons-from-the-new-book-carbon-democracy.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29Long before politicians mewled helplessly about the power of “Big Oil”, carbon-based fuels were shaping our very political, legal, intellectual, and physical structures. It was, for instance, coal miners who brought us the right to vote. Israel’s founding had a lot to do with British fears of Palestinian labor unrest in coastal energy complexes. And the European Community was a post-WWII experiment to switch that continent to oil, a task begun before World War I by British conservatives to defeat their domestic political opponents. Glass-Steagall crimped financial flows, partially at the behest of the oil industry. In fact, you can’t understand modern democratic or third world political structures without understanding energy, and particularly, coal and oil. That’s the contention of Tim Mitchell’s new book, Carbon Democracy: Political Power in the Age of Oil, a history of the relationship between carbon-based fueling sources and modern political systems. It’s a book that tackles a really big subject, in a sweeping but readable fashion, and after reading it, it’s hard to imagine thinking about political power the same way again.
Everything in our politics flows through dense carbon-based energy sources, and has for three to four hundred years. For instance, the invasion of Iraq in 2003 was a pivotal moment in America’s strategic outlook. America, a global hegemon whose empire was weakening, seized the second largest oil deposits in the world as a way of preventing its economic and political decline. Was there any precedent for this kind of action? As it turns out, yes. The last declining global hegemon, Great Britain, also engaged in a brutal and highly controversial British occupation of Iraq, in the 1920s, pressed aggressively by the well-known British conservative, Winston Churchill. Churchill supported this occupation not just because he wanted Iraq’s oil, but because he wanted to defeat democratic forces – particularly militant coal miner unions – at home. Churchill and conservative elites running through British history (most recently Margaret Thatcher) understood that as long as the British power grid, and more importantly the military, was dependent on radical coal miners, his left-leaning labor opponents would be able to demand higher wages, social insurance, voting rights, and a share of the economic gains of the British economy. He preferred to have the British economy running on oil, so he sought imperial strategies to ensure access to resources without being reliant on his political opponents. Globally, in fact, the switch from coal to oil was a fight about labor.
The use of coal and oil in the context of industrialization has always been about who has the power to profit from the surplus these energy forms produce, but until now, no one has pulled the various historical details together into a historical narrative laying bare the fascinating power dynamics behind the rise of Western political systems and their relationship with energy. Carbon Democracy is an examination of our civilization’s 400 hundred year use of carbon-based energy fueling sources, and the political systems that grew up intertwined with them. Rather than presenting energy and democracy as separate things, like a battery and a device, Mitchell discusses the political architecture of the Western world and the developing world as inherently tied to fueling sources. The thesis is that elites have always sought to maximize not the amount of energy they could extract and use, but the profit stream from those energy sources. They struggled to ensure they would be able to burn carbon and profit, without having to rely on the people who extract and burned it for them. Carbon-based fuels thus cannot be understood except in the context of labor, imperialism and democracy.
This book is a response to David Yergen’s The Prize: The Epic Question for Oil, Money, and Power, a classic story ( OR PERHAPS MORE ACCURATELY: FAIRY TALE! DEMETER) of hardy entrepreneurs taking huge risks to find oil in the most remote places. Yergen’s narrative centers on oil scarcity, and its contributions to economic growth in a capitalist framework. Oil is, to Yergen, the prize, solving the key problem of how to supply enough energy for a modern consumer society with a flexible and inexpensive fuel source...In Carbon Democracy, Mitchell has a counterintuitive take on oil, one that after awhile, makes much more sense than what Yergen argues. Mitchell points out that the problem of oil has never, until recently, been that it is a scarce commodity, but that it is a surplus commodity. We had too much of it. And the central problem that this created was not how to find more of it, but how to ensure that oil cartels profiting from high oil prices could make sure that very few new oil finds, especially from the massive fields in the Middle East, came online. Far from a hardy band of entrepreneurs searching for more oil, the story of oil is one of parasitic cartels manipulating governments and inventing concepts like mandates, self-determination, and national security to ensure they could retain high profits selling a widely available commodity. But Mitchell takes the story much deeper than Yergen did, because Yergen’s book is fundamentally a fairy tale that skirts over questions of labor and colonialism...
THE IMPLICATIONS OF SWITCHING TO RENEWABLE ENERGY SOURCES, ESPECIALLY DECENTRALIZED RENEWABLES, IS PROFOUND. IT MAY BE THE SAVING OF MORE THAN JUST THE CLIMATE AND ECOSYSTEM
...Mitchell has reinterpreted the creation of much of our democratic apparatus, from labor laws to minimum wages to the right to vote to resistance to imperialism, as the struggle between different types of carbon-based fuels and the various characteristics of the labor required to extract and use them...
A MUST READ!
Is Our Republic Ending? 8 Striking Parallels Between the Fall of Rome and U.S.
I'D SAY IT ENDED IN 2000 WHEN THE DANCING SUPREMES FIXED THE ELECTION FOR W...AND WE THE PEOPLE ARE STILL IN CATCH-UP MODE, UNABLE TO ABSORB, LET ALONE DEAL WITH IT.
I'M WAITING TO SEE HOW IT ALL COMES OUT
http://www.alternet.org/economy/our-republic-ending-8-striking-parallels-between-fall-rome-and-us?akid=9836.227380.7KKamG&rd=1&src=newsletter764878&t=10&paging=off
Lawrence Lessig'sRepublic Lost documents the corrosive effect of money on our political process. Lessig persuasively makes the case that we are witnessing the loss of our republican form of government, as politicians increasingly represent those who fund their campaigns, rather than our citizens.
Anthony Everitt'sRise of Rome is fascinating history and a great read. It tells the story of ancient Rome, from its founding (circa 750 BCE) to the fall of the Roman Republic (circa 45 BCE).
When read together, striking parallels emerge -- between our failings and the failings that destroyed the Roman Republic. As with Rome just before the Republic's fall, America has seen:
1 -- Staggering Increase in the Cost of Elections, with Dubious Campaign Funding Sources:Our 2012 election reportedly cost $3 billion. All of it was raised from private sources - often creating the appearance, or the reality, that our leaders are beholden to special interest groups. During the late Roman Republic, elections became staggeringly expensive, with equally deplorable results.Caesar reportedly borrowed so heavily for one political campaign, he feared he would be ruined, if not elected.
2 -- Politics as the Road to Personal Wealth: During the late Roman Republic period, one of the main roads to wealth was holding public office, and exploiting such positions to accumulate personal wealth. As Lessig notes: Congressman, Senators and their staffs leverage their government service to move to private sector positions - that pay three to ten times their government compensation. Given this financial arrangement, "Their focus is therefore not so much on the people who sent them to Washington. Their focus is instead on those who will make them rich." (Republic Lost)
3 -- Continuous War: A national state of security arises, distracting attention from domestic challenges with foreign wars. Similar to the late Roman Republic, the US - for the past 100 years -- has either been fighting a war, recovering from a war, or preparing for a new war: WW I (1917-18), WW II (1941-1945), Cold War (1947-1991), Korean War (1950-1953), Vietnam (1953-1975), Gulf War (1990-1991), Afghanistan (2001-ongoing), and Iraq (2003-2011). And, this list is far from complete.
4 -- Foreign Powers Lavish Money/Attention on the Republic's Leaders: Foreign wars lead to growing influence, by foreign powers and interests, on the Republic's political leaders -- true for Rome and true for us. In the past century, foreign embassies, agents and lobbyists have proliferated in our nation's capital. As one specific example: A foreign businessman donated $100 million toBill Clinton's various activities. Clinton "opened doors" for him, and sometimes acted in ways contrary to stated American interests and foreign policy.
5 -- Profits Made Overseas Shape the Republic's Internal Policies:As the fortunes of Rome's aristocracy increasingly derived from foreign lands, Roman policy was shaped to facilitate these fortunes. American billionaires and corporations increasingly influence our elections. In many cases, they are only nominally American - with interests not aligned with those of the American public. For example, Fox News is part of international media group News Corp., with over $30 billion in revenues worldwide. Is Fox News' jingoism a product of News Corp.'s non-U.S. interests?
6 -- Collapse of the Middle Class: In the period just before the Roman Republic's fall, the Roman middle class was crushed -- destroyed by cheap overseas slave labor. In our own day, we've witnessed risingincome inequality, a stagnating middle class, and the loss of American jobs to overseas workers who are paid less and have fewer rights.
7 -- Gerrymandering:Rome's late Republic used various methods to reduce the power of common citizens. The GOP has so effectivelygerrymandered Congressional districts that, even though House Republican candidates received only about 48 percent of the popular vote in the 2012 election -- they ended up with the majority (53 percent) of the seats.
8 -- Loss of the Spirit of Compromise: The Roman Republic, like ours, relied on a system of checks and balances. Compromise is needed for this type of system to function. In the end, the Roman Republic lost that spirit of compromise, with politics increasingly polarized betweenOptimates (the rich, entrenched elites) and Populares (the common people). Sound familiar? Compromise is in noticeably short supply in our own time also.For example, "There were more filibusters between 2009 and 2010 than there were in the 1950s, 1960s and 1970s combined."
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About the Author: Steven Strauss was founding Managing Director of the Center for Economic Transformation at the New York City Economic Development Corporation (NYCEDC). Steven was one of the NYC leads for Applied Sciences NYC, NYC BigApps and many other initiatives to foster job growth, innovation and entrepreneurship. He is an Advanced Leadership Fellow at Harvard University for 2012. In 2010, Steven was selected as a member of the Silicon Alley 100 in NYC. He has a Ph.D. in Management from Yale University, and over 20 years' private sector work experience. Geographically, Steven has worked in the US, Asia, Europe and the Middle East.
How Will the 99% Deal with 70 Million Psychopaths? ELECT THEM TO CONGRESS, I GUESS
http://www.cognitivepolicyworks.com/blog/2012/07/24/how-will-the-99-deal-with-70-million-psychopaths/Did you know that roughly one person in a hundred is clinically a psychopath? These individuals are either born with an emotional deficiency that keeps them from feeling bad about hurting others or they are traumatized early in life in a manner that causes them to become this way. With more than 7 billion people on the planet that means there are as many as 70,000,000 psychopaths alive today. These people are more likely to be risk takers, opportunists motivated by self-interest and greed, and inclined to dominate or subjugate those around them through manipulative means.
Last year, the Occupy Movement drew a distinction between the top 1% and the remaining 99% — as distinguished by measures of wealth and income. Of course, this breakdown is misleading since there are many top income earners who sympathize with the plights of others and are not part of the problem. Now the real defining metric reveals itself: 1% of the global population is comprised of people who exhibit psychopathic tendencies.
The global economy we have today is built on a deep history of top-down hierarchies that promote domination and control. There have been plenty of feudal lords, warrior chieftains, and violent dictators throughout the last 6000 years of burgeoning civilization. The modern era saw the ascension of “corporate personhood” as an amoral entity enshrined into law by an 1886 ruling of the US Supreme Court. This provided a new mechanism for mobilizing capital by the moneyed elites to deploy their wealth into the realm of public policy and civil society — creating the dysfunctional economic system we must now contend with as we struggle to address global challenges.
We find ourselves in a situation where economic philosophies that celebrate selfishness can be implemented through a web of legal and financial tools that elevate and reward those individuals with psychological tendencies toward self-interest — the same people who also have a predisposition to game social contexts to their advantage regardless of impacts on others. Thus the psychopathic corporation was forged as a Frankenstein monster that enabled the constant flow of psychopathic blood, continuously replenished by the 1% of the population born into psychopathy in each new generation, to rise into positions of power as stock traders, corporate executives, and corruptible politicians....
Weekend Economists Go Caroling December 21-23, 2012
I thought I shouldn't propagate the culture of violence that leads to militarized weapons in the hands of deranged boys/men, so I'm not featuring Bond tonight.
Instead, let's hark back to a kinder, gentler time, when saints walked among us:
When the snow lay round about, deep and crisp and even;
Brightly shone the moon that night, tho' the frost was cruel,
When a poor man came in sight, gath'ring winter fuel.
"Hither, page, and stand by me, if thou know'st it, telling,
Yonder peasant, who is he? Where and what his dwelling?"
"Sire, he lives a good league hence, underneath the mountain;
Right against the forest fence, by Saint Agnes' fountain."
"Bring me flesh, and bring me wine, bring me pine logs hither:
Thou and I shall see him dine, when we bear them thither. "
Page and monarch, forth they went, forth they went together;
Through the rude wind's wild lament and the bitter weather.
"Sire, the night is darker now, and the wind blows stronger;
Fails my heart, I know not how; I can go no longer. "
"Mark my footsteps, good my page. Tread thou in them boldly
Thou shalt find the winter's rage freeze thy blood less coldly. "
In his master's steps he trod, where the snow lay dinted;
Heat was in the very sod which the saint had printed.
Therefore, Christian men, be sure, wealth or rank possessing,
Ye who now will bless the poor, shall yourselves find blessing.
If you click on this link, you see another interpretation:
http://jeffreyhill.typepad.com/.a/6a00d8341d417153ef0120a77e2724970b-pi
Down below in the snow are UK Prime Minister Gordon Brown and Chancellor of the Exchequer Alistair Darling. Both are wearing bathing costumes. Brown is holding a rubber ring. Darling is collecting sticks ("When a poor man came in sight, gath'ring winter fuel"
. Clearly, they were expecting summer temperatures. The angry-looking King shouts down to them, "So much for your optimistic forecast!"
The joke involves a play on the word 'forecast', which can be taken as referring to the weather forecast or the economic forecast. In both cases, Brown and Darling have got it wrong....
http://www.englishblog.com/2009/12/cartoon-good-king-wenceslas-looked-out-.html#.UNTml6z3R1g
We'll look more into this carol, and others, to squeeze out a little Christmas comfort on this blustery, bitter night.
God knows, we won't find it in the economic news....
Welcome to 'Michiganistan' By Jim Hightower
http://www.alternet.org/news-amp-politics/welcome-michiganistan?akid=9833.227380.QCO3bB&rd=1&src=newsletter764612&t=4Michigan is no longer a state. It is now “Michiganistan,” an autocratic czardom in the hands of Emperor Rick Snyder. Formerly the Republican governor, Snyder has been enthroned by the GOP’s lame-duck, legislative supermajority to rule with an iron fist — democracy, rule-of-law, fairness, and the people be damned....Ironically, voters had given Snyder and his cohort of right-wing corporate ideologues a spanking for this kind of nastiness in a November referendum. The GOP cabal in Lansing had conspired last year to usurp the local authority of city governments and allow Snyder to send in unelected, unaccountable autocrats to fire elected officials and seize control, but last month, Michigan voters overthrew this absurdity.
This month, however, Snyder and gang doubled down on their dumbfounding, anti-democratic zealotry. With no warning, no hearings, no public input, no floor debate, and no time for citizens to even know what was happening, the same legislative czarists rammed a union-busting bill into law. Even though he had publicly rejected such a proposal earlier this year as being “very divisive,” Emperor Snyder gleefully signed this measure.
Who’s behind this madness? Say hello to two infamous, anti-union, billionaire plutocrats: the Koch brothers. They had funneled as much as a million dollars into Snyder’s 2010 gubernatorial election, and three Michigan front groups funded by the billionaire brothers aggressively pushed the exact same anti-worker proposal that the Republican thugs just bullied into law.
Two things not long for this world are dogs that chase cars and politicians who deceive and cheat the people. Already, Michiganders are organizing a petition drive for another referendum to overturn the law and return the Czardom of Michiganistan back to democratic rule. Stay tuned.
YOU BETCHA WE ARE! IT'S GOING TO BE ANOTHER EPIC FAIL!
MAYBE THIS CAN REPLACE CRAP LIKE DANCING WITH THE STARS, OR THAT SURVIVAL THINGEE...
Let's Take Back the Banks from Greedy Financiers
http://www.alternet.org/economy/lets-take-back-banks-greedy-financiers?akid=9788.227380.39lJkQ&rd=1&src=newsletter759023&t=18&paging=off...North Dakota is currently the only U.S. state to own its own depository bank. The BND was founded in 1919 by Norwegian and other immigrants, determined, through their Non-Partisan League, to stop rapacious Wall Street money men foreclosing on their farms.
All state revenues must be deposited with the BND by law. The bank pays no bonuses, fees or commissions; does no advertising; and maintains no branches beyond the main office in Bismarck. The bank offers cheap credit lines to state and local government agencies. There are low-interest loans for designated project finance. The BND underwrites municipal bonds, funds disaster relief and supports student loans. It partners with local commercial banks to increase lending across the state and pays competitive interest rates on state deposits. For the past ten years, it has been paying a dividend to the state, with a quite small population of about 680,000, of some $30 million (£18.7 million) a year.
Young writes:
With that kind of resilience, it’s little wonder that twenty American states, some of them close to bankruptcy, are at various stages of legislating to form their own state-owned banks on the North Dakota model. There’s a long-standing tradition of such institutions elsewhere too. Australia had a publicly-owned bank offering credit for infrastructure as early as 1912. New Zealand had one operating in the housing field in the 1930s. Up until 1974, the federal government in Canada borrowed from the Bank of Canada, effectively interest-free.
. . . From our western perspective, we tend to forget that, globally, around 40 per cent of banks are already publicly owned, many of them concentrated in the BRIC economies, Brazil, Russia, India and China.
Banking is not just a market good or service. It is a vital part of societal infrastructure, which properly belongs in the public sector. By taking banking back, local governments could regain control of that very large slice (up to 40 per cent) of every public budget that currently goes to interest charged to finance investment programs through the private sector.
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Michigan Republicans' Corporate Servitude Law
http://www.alternet.org/michigan-republicans-corporate-servitude-law?akid=9799.227380.zjXGoK&rd=1&src=newsletter760425&t=17Michigan has just passed a corporate servitude law. It is designed to take away many of the worker rights that unions have conferred throughout their history: The right to a living wage. The right to equal pay for women. The right to deferred payments in the form of pensions. The right to negotiate workplace standards and working conditions. The right to overtime pay....The law is intended to destroy unions, or at least make then ineffective. It says simply that workers do not have to pay union dues to take a job — even if they get benefits previously negotiated by a union. Most workers who don't have to pay dues won't pay, and that will defund the unions, killing them and taking away rights unions have fought hard for over generations. Without workers negotiating as a unified group, corporations will not have to grant those union-created rights. Corporations will have take-it-or-leave-it power over individual workers. In short, this is corporate servitude: you do what you are told and take what you are offered.
The deeper truth about unions is that they don't just create and maintain rights for workers; they work for and create crucial rights in society as a whole. Unions created weekends, the eight-hour workday, and health benefits. And through their politics, they have been at the center of support for civil rights and other social justice issues. In short, unions don't just work for their members. They work for all of us. Including businesses: workers are profit creators. Since Democratic candidates tend to support the same progressive views, defunding unions would take away their power to campaign for Democratic candidates. The new Michigan law is thus also a partisan law supporting the Republican party....Language matters. Republicans understand this better than Democrats. Republicans have called their corporate servitude law a “right to work” law, as if the law conferred a right instead of taking many away. The first principle of political and social communication in cases of conflict is: Avoid the other side’s language. The Democrats keep violating this principle, using the Republicans’ name for this law. In this way they are helping Republicans, because using the Republican language activates Republican framing, not just for this law, but for conservative ideology at the deepest level.
Progressives and conservatives have opposing views of democracy. For progressives, democracy is based on citizens caring about each other and acting responsibly on that care, with both individual and social responsibility, to provide through the government protection and empowerment for all. Government thus becomes a means by which citizens pay for public provisions to benefit all: public infrastructure (roads, bridges, hospitals, public buildings), public education, public health and safety (clean air, clean water, safe food, disease protection), a patent office to protection innovations, a justice system, and networks for energy, communication, and transportation. Without all these public provisions, we are not free: business cannot thrive (if it can operate at all) and we cannot live decent, civilized private lives. It is a deep truth about our democracy: our freedom depends on such public provisions and the private depends on the public. Unions both defend these freedoms and add to them the worker rights unions have created.
Conservatives don't accept this truth, if they perceive it at all. They tend to see democracy as providing “liberty” — the liberty to pursue one’s own interests and well-being through personal responsibility, without being responsible for the interests or well-being of others and without others being responsible for them.
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