January 2011

Egypt and the False Dilemma - Decline and Fall (Maybe) Jan 31

By Michael Collins

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances. Image: Cairo, January 2011

The people of Egypt have had enough of a failed dictatorship masquerading as a democracy. As events unfold, we're seeing a cautionary message entering the corporate media coverage of this event. Having never exposed the dire conditions that prompted the massive protests and demands for change, we're now told that this could negatively impact oil supplies, the stock market, and anti-terror efforts. No foundation for the claims was provided but they're repeated regularly on CNN, the NBC's, Fox, and the print media.

Thus, a false dilemma is created for the public: support the right of people to determine their own fate or protect your safety and the current standard of living, as it were.

Outsourcing Is Not Good For America

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Who can forget that infamous declaration by Greg Manikiw, Outsourcing is good for America, backed up by fictional economics from an an offshore outsourcing group. gechina Despite the never ending alarming U.S. unemployment rate, the jobs crisis and the stagnant wages, it seems Obama is touting the same philosophy. Economists, on the other hand, refuse to dare challenge this corporate party line and mention the O word, outsourcing.

Where are the jobs? John Bougearel really nails it on fictional CBO and BLS future employment projections.

American policies must take steps to stop the bleeding of jobs overseas, Obama’s new Council on Jobs and Competitiveness should be enacting policies and proposing legislation that repatriates US jobs and disincentivizes further outsourcing of US jobs. These policies would of course be hugely unpopular with Corporate America, but that is the crossroads where we now stand.

Bougearel lists the never ending fiction BLS job growth projections and now similar delusional numbers by the CBO for 2011-2015.

The CBO is projecting 2.5 million jobs will be created annually from 2011 to 2015. From the CBO: “As the recovery continues, the economy will add roughly 2.5 million jobs per year over the 2011–2016 period.”

Saturday Reads Around The Internets for January 29, 2011

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shocknews
Welcome to the weekly roundup of great articles, facts and figures. These are the weekly finds that made our eyes pop.

FCIC Report Is Lacking

New York Times financial writer Joe Nocera incorrectly compares the financial crisis to the 1700's Dutch Tulip Bulb Bubble. Yves Smith of Naked Capitalism shows Nocera is subtly blaming the victims for the financial crisis. Smith, cuts to the chase on the real FCIC report shortcoming:

Deadbeats Bush and Gingrich Say "States Better Off Bankrupt"

Michael Collins

 

Not if a state owes you money!

Jeb Bush and Newt Gingrich just published an OpEd in the Los Angeles Times arguing that states would be wise to consider filing bankruptcy to relieve their financial troubles.  They cite three states, California, Illinois and New York, while failing to mention the angry elephant in the living room with similar problems, Texas.

Texas faces a $25 billion shortfall for a $95 billion two-year budget.  That equals California's 18-month deficit inherited by the recently inaugurated Governor Jerry Brown.

"So why haven't we heard more about Texas, one of the most important economy's in America? Well, it's because it doesn't fit the script. It's a pro-business, lean-spending, no-union state. You can't fit it into a nice storyline, so it's ignored," said Business Insider

Texas is a major inconvenience to Bush and Gingrich. They lay the financial problems at the door of unions and state employee pensions:

"The lucrative pay and benefits packages [read pensions] that government employee unions have received from obliging politicians over the years are perhaps the most significant hurdles for many states trying to restore fiscal health."  Jeb Bush, Newt Gingrich, January 27

Durable Goods New Orders Down 2.5% for December 2010

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New Orders in Durable Goods dropped -2.5% for December 2010, after last month's -0.1% decrease, which was significantly revised. New orders has declined 4 of the past 5 months. New orders in non-defense capital goods decreased -6.3%. Core capital goods new orders increased 1.4%. Nondefense aircraft & parts new orders dropped -99.5%. Even for volatile aircraft that's an astounding drop.

Don't Worry, Be Happy, Financial Armageddon Didn't Have to Happen Really

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The Financial Crisis Inquiry Commission has released their final report and to no one's surprise it's a mealy-mouthed white wash to reduce real accountability of many facts already known. Read it here. houseofcards.jpegBasically the report rehashes a lot of information already discovered as the causes of Financial Armageddon. Case in point is Goldman Sachs obtaining $2.9 billion through the AIG bail out.

Goldman Sachs collected $2.9 billion from the American International Group as payout on a speculative trade it placed for the benefit of its own account, receiving the bulk of those funds after AIG received an enormous taxpayer rescue,

The report does drive home the overriding message Financial Armageddon didn't have to happen. It was a direct result of fictional derivatives, deregulation and a host of other financial lobbyists' wish lists which were granted absolute in the last 30 years.

Yves Smith, Naked Capitalism who has been following every nitty gritty detail since day one:

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