Thursday, April 18, 2013

Lawrence Wittner: That's Where the Money Goes

Lawrence Wittner: That's Where the Money Goes
The United States spent more than four times as much on the military as China (the number two big spender) and more than seven times as much as Russia (which ranked third). 

Wednesday, April 17, 2013

Whoops! Turns out debt doesn’t ruin economies -

Whoops! Turns out debt doesn’t ruin economies -
"The reason we are just now getting critical second looks at Reinhart and Rogoff’s findings, when the paper in question came out in 2010, is that the economists just didn’t release their data. Here’s Dean Baker complaining about that fact in 2010. As he wrote: “Mr. Rogoff and Ms. Reinhart have declined to adhere to standard ethics within the economics profession and have refused to share the data on which they base their conclusion with other researchers.”
This is important — it should in fact be a Big Deal — because Reinhart and Rogoff have been the ultimate authorities in the appeals to authority from everyone advocating austerity in the U.S. and across the world for the last few years. Tim Fernholz excerpts Tom Coburn’s account of the address the two gave to 40 senators, and quotes officials and politicians from Europe and the U.S. and from both sides of the American party divide praising Reinhart and Rogoff’s study.
So, austerity’s canceled, right? Haha, no, sorry.
The problem is that debt moralists used the study to justify a political belief, and they will not shed that belief now that the study has been shown to be flawed. The idea that debt is just innately bad, and indicative of a sort of national deficiency of character, will persist. It’s not based on data, it’s based on facile analogies to kitchen table checkbook balancing and “common sense” about how it is always necessary to “live within your means.” We already have plenty of evidence that austerity doesn’t boost economies, and no one cares. No one will care about this."

Tuesday, April 16, 2013

A Tax System Stacked Against the 99 Percent -

A Tax System Stacked Against the 99 Percent -
"What should shock and outrage us is that as the top 1 percent has grown extremely rich, the effective tax rates they pay have markedly decreased. Our tax system is much less progressive than it was for much of the 20th century. The top marginal income tax rate peaked at 94 percent during World War II and remained at 70 percent through the 1960s and 1970s; it is now 39.6 percent. Tax fairness has gotten much worse in the 30 years since the Reagan “revolution” of the 1980s."

Goldman, AIG and the government renew their friendship - Reuters

Goldman, AIG and the government renew their friendship | Unstructured Finance
"For those who follow bailout sagas, the idea of a Goldman bankers handling AIG’s bailout repayment and being congratulated by a former government official has a certain degree of irony.
One of the biggest scandals coming out of the financial crisis was a $12.9 billion payment AIG made to Goldman Sachs after its bailout in the fall of 2008. The payout was related to credit default swaps that Goldman had purchased from AIG in the years leading up to the crisis, to protect against potential losses on mortgage securities.
As mortgages went belly up in 2007, Goldman began demanding payments from AIG. The two parties had a drawn-out, heated battle about the amount of money Goldman deserved. But when the government took over AIG’s finances, the insurer paid Goldman and more than a dozen other banks 100 cents on the dollar.
Goldman got special scrutiny because it received more than other banks, and because the country was in the midst of a populist backlash against Wall Street. Within four months, Goldman Sachs had become the “vampire squid” – a moniker that stuck – and dozens of conspiracy theories about Goldman being “Government Sachs” took root."