John Kenneth Galbraith, 1908-2006

John Nichols, writing at The Nation remembers a giant.

His New York Times obituary, and Brad DeLong's thoughts on his legacy.

Stephen Colbert jams it sideways

If you haven't already, read the transcript and watch the complete video of Stephen Colbert's performance at the White House Correspondent's Dinner. In my opinion, reading the transcript is funnier because you can't help but feel scared for Colbert's safety as he savages the administration. Bush looked pretty pissed off at times.

Colbert has a lot of balls to do what he did. it was, to say the very least, a devestating performance. Whoever booked him for the gig is probably already fired.

Not suprisingly, the mainstream media are literally ignoring Colbert's brilliant performance.

Engler and Dangl on Evo Morales's "progressive mandate"

From the March issue of Z Magazine.

NAFTA lies are the real story behind immigration

I've written about this a number of times in the past, and I hate to keep beating a dead horse, but I don't think this has sunk in for most Americans. Those self-proclaimed patriotic Americans who are against immigrants from Mexico streaming across the border and into America looking for a better life seem solely interested in blaming--and punishing--the victims of US trade policy. Somehow, it is seen by these misguided patriots as being wrong for immigrants to want to come over to this country in order to find work opportunities and achieve a standard of living that is being rapidly foreclosed in their own country. The way they frame the issue, these desperate Mexicans are sneaking into this country, thumbing their noses at the INS, taking advantage of our health care system and stealing jobs from hard-working American citizens. If only they gave some thought as to why there are so many immigrants uprooting their families and risking their lives to come work here as undocumented "aliens".

Maybe there would be a little more concern for these industrious, hard-working Mexican laborers if some thought were to be given as to what economic forces, or "push factors" were creating the need for them to immigrate. For starters, NAFTA has been an unmitigated disaster for Mexico's economy and working class, a deal sold to the country by the Wall Street wing of the Democratic party (i.e.: Clinton, Rubin, Summers, etc.), an idea they co-opted in many ways from their Republican rivals, as well as by the financial elites in Mexico. (The story of NAFTA and how it was dishonestly packaged and sold is brilliantly recounted in Jeff Faux's Global Class War.)

As a new editorial penned by Roger Bybee and Carolyn Winter in Truthout makes clear, the legacy of NAFTA's failed promises are central to the current phenomenon of illegal immigration to this country, a challenge that can never be solved unless the devestation wrought by these trade deals is finally addressed head on.

As Bybee and Winter note:

While there has been some media coverage of NAFTA's ruinous impact on US industrial communities, there has been even less media attention paid to its catastrophic effects in Mexico:

NAFTA, by permitting heavily-subsidized US corn and other agri-business products to compete with small Mexican farmers, has driven Mexican farmers off the land due to low-priced imports of US corn and other agricultural products. Some 2 million Mexicans have been forced out of agriculture, and many of those that remain are living in desperate poverty. These people are among those that cross the border to feed their families. (Meanwhile, corn-based tortilla prices climbed by 50%. No wonder so many Mexican peasants have called NAFTA their "death warrant.")

NAFTA's service-sector rules allowed big firms like Wal-Mart to enter the Mexican market and, selling low-priced goods made by ultra-cheap labor in China, to displace locally-based shoe, toy, and candy firms. An estimated 28,000 small and medium-sized Mexican businesses have been eliminated.

Wages along the Mexican border have actually been driven down by about 25% since NAFTA, reported a Carnegie Endowment study. An over-supply of workers, combined with the government-sponsored crushing of union organization, has resulted in sweatshop pay along the border where wages now typically run 60 cents to $1 an hour.

Maybe we should start asking why the so-called liberal US media doesn't report any of these facts, which are obviously very relevant to the ongoing immigration "debate" which is being driven in large part by fear, ignorance and outright disinformation. Probably because the media, while moderately liberal on some social issues, is actually quite obsessive in its unbridled neoliberal free-trade orthodoxy.

The editorial also notes:

NAFTA essentially annexed Mexico as a low-wage industrial suburb of the US and opened Mexican markets to heavily-subsidized US agribusiness products, blowing away local producers. Capital could flow freely across the border freely to low-wage factories and Wal-mart-type retailers, but the same standard of free access would be denied to Mexican workers.

Perhaps the saddest aspect of the entire debate is the fact that many "progressives" are siding againt the immigrants without taking these important issues into account. As this Salon article makes clear, some progressive activists are so concerned with the impact immigration is having on unemployment and wages in the US that they have completely ignored the much bigger picture described above. Not only would reforming our destructive "free trade" deals improve Mexico's domestic economy and take some pressure off of the supply side of the equation (that is, fewer immigrants driven by desperation to illegally enter the US), but would also benefit blue collar Americans, the manufacturing sector, etc. Unfortunately, the Bush administration has demonstrated its undying commitment to more of these pathetic trade deals with its passage of CAFTA, which many Democratic lawmakers were all-too-happy to support.

None of this is new, of course, but it's time for Americans to realize who and what is responsible for the problem, and if they care about addressing the problem, then we as a country need to start taking positive steps to fix it. Educating ourselves about the impact of free trade deals like NAFTA and CAFTA is a necessary first step. And as Tom Barry from the International Relations Center recently noted in a recent detailed research report on the subject, "A comprehensive immigration reform bill would also be formulated within the context of a domestic policy commitment by government to full employment at livable wages and working conditions."

Troubled times goes on short semi-hiatus

With only 13 days left in my semester, this blog is unfortunately going to be more or less neglected for the near future. Nevertheless, I'll occasionally post some interesting articles I find online for your reading pleasure (although analysis will probably be conspicuously absent, or at least much less robust than usual).

Here are some pieces I've read today that I recommend. I especially recommend the post by blogger Betsy Angert, which refers to my previous post on the role of civil disobedience and the phenomenon of some taxpayers protesting the Iraq war, although she reaches a somewhat different conclusion than I did.

I hope to continue to update this list over the next few days, so checking in regularly!

"Regulators Investigate Key Leak to Wall Sreet", The Hill (hat tip Sirotablog)

"Civil Disobedience, Thoreau, Anti-Iraq War Tax Resisters, Mary McCarthy", Betsy Angert (Be-Think Blog)

Interview of John Moody, SVP News Editorial at FoxNews, wherein he tries to claim that the major media can't be intimidated by the Bush Administration, Rory O'Connor

Schumer calls for investigation into possible "breakup" of "giant" oil companies, Raw Story

Former Top CIA Official, Tyler Drumheller, Calls Out Bush on WMD Lies, CBS News

"Study: Money Sways Federal Drug Voting", Associated Press

Gap continues to grow between worker-CEO pay

A new report by the Center for American Progress on the growing divide in the fortunes between the CEOs and Middle Class Americans can be read in its entirety here.

From the report:

In the fifth year of this business cycle, the fortunes of CEOs and middle-class families pulled further apart. In 2005, the typical CEO received $11.6 million in total direct compensation—salaries, bonuses, restricted stock grants, gains from stock option exercises and other long-term incentive payouts. This constituted a 24 percent increase over the 2004 average of $9.3 million. This means that in 2005, the average CEO made 279 times the average pay of a production non-supervisory worker, the vast majority of America’s private sector work force. This is up from 185 times in 2003 and 229 times in 2004.

And speaking of the rich getting even richer, it looks like the oil companies are once again set to post record profits as the price of gasoline hovers around $3 a gallon across many parts of the US.

Nothing to see here, move along.

The China buildup?

Professor Michael Klare writes about the Bush administration's newest geopolitical concern: China's increased military spending. Of course, as part of the US's stated goal of remaining unchallenged as the most powerful country in the world, such a challenge is completely unacceptable. Right now, China is much more of an economic rival than a military rival, and it spends only a tiny fraction of what the US does on its defense budget. However, this doesn't allay concerns from hawks at the Pentagon and right-wing think tanks that we need to beef up our own military capacity in the Pacific Ocean.

The Wall Street Journal recently had a front page story on the historic realignment of US military assets from Europe to Asia as well as a push to have Japan integrate its own military with our own. Interestingly, the article goes on to note that most Asian countries view a more aggressively militaristic Japan as being a greater cause for concern than China.

WSJ reports on IMF's waning influence

I've previously written about signs the IMF is losing clout with finance ministers of developing countries (see here, for example), from East Asia to Latin America, for a number of reasons. This includes the harsh prescriptions it has forced on countries to approve loans as well as the robust global economy. The Wall Street Journal had an interesting front-page article basically re-affirming the continued trend. Because wsj.com is subscription-only, I have taken the liberty of extensively excerpting the piece below.

WASHINGTON -- When world finance ministers gather here tomorrow for the International Monetary Fund's spring meeting, the agency that has confidently dispensed advice to countless governments in distress will be searching hard for answers to its own identity crisis.

For much of its 61 years, the 184-member-nations IMF has acted as the fire brigade for the global financial system. When economic crises flared up in countries ranging from Mexico to Turkey, the IMF would try to snuff them with emergency loans. In return for cash, economically troubled countries were compelled to undertake harsh new policies -- often cuts in government spending or interest-rate increases -- to try to fireproof their economies.

Now the IMF faces a novel predicament: A robust global economy, growing at a 4% clip since 2003, has left the IMF with a dearth of financial firestorms to manage, and fewer countries willing to borrow from it and heed its dire lending conditions. Flush with cash and eager to regain control over their economic policies, 10 countries, from Russia to Brazil to Argentina, have repaid loans to the IMF ahead of schedule in recent years. The IMF's current loan portfolio of $35 billion is its smallest since the 1980s.

The effect is twofold: A shrinking loan portfolio greatly diminishes the IMF's influence over global economic policy. IMF loan disbursements are conditioned on the enactment, within defined time frames, of measures including privatization of state-owned companies, budget cuts, interest-rate increases and stiffer financial regulation. Once IMF loans are ended, the momentum for economic reform in one-time borrowers may fizzle. That's a worry in Latin America, especially where populist politicians are winning power across the continent.

Fewer loans also means less interest income, and thus fewer dollars in the IMF coffers. In an irony that has provoked tittering among many emerging-market finance ministers, the agency that has long preached belt-tightening now must practice it itself. Over the next three years, the IMF figures it may sustain operating losses of nearly $600 million, and have to dip into its nearly $9 billion in cash reserves to cover the shortfall. To reduce the red ink, the Fund has already capped personnel levels at 2,800 and is planning budgets that would lag behind the rate of inflation. It may start charging nations for technical advice that the IMF now provides free. If that doesn't work, it may have to tap its vast gold hoard of 103 million ounces, valued at $63.5 billion at today's prices and held in the vaults of IMF member nations.

To be sure, the global good times have been powered by low interest-rates, U.S. consumer spending and Asian demand for commodities -- a combination that could come to a halt, and plunge developing countries into crises and knocking on the IMF's door again.


But for now, thanks to the vast sums of capital sloshing around the world's economy, developing nations are enjoying more freedom than ever before to chart more individualistic courses. From 2001 to 2005, the key emerging economies in Asia, led by China, have seen their reserves grow about 2.5 times to $1.7 trillion. In Latin America, reserves of the largest economies nearly doubled over the same time period to $223 billion, according to ABN-Amro.
The IMF is trying gamely to change the way it does business, from lender to "confidential adviser," as Rodrigo de Rato, the IMF's managing director, puts it. That entails a mixture of sound economic advice, outreach to one-time opponents -- and a splash of public relations. Arm-twisting is out; persuasion is in. When Mr. de Rato visited Tegucigalpa, Honduras, in February, he not only went to see the president and finance minister, but also trekked to the rough-and-tumble Campo Cielo barrio. He toured a project where social workers were removing gang-insignia tattoos from youths and the IMF even sent some money later.

[...]

Many important decisions by the Fund require 85% approval by shareholder nations, with votes apportioned to each country based on its general position in the world economy. The largest single shareholder, the U.S., accounts for about 17% of the total vote, giving it effective veto power on issues such as expanding the Fund's financial base or changing voting shares.

Over the decades, the Fund's focus shifted to developing nations. When oil prices fell and Mexico ran out of money to pay its lenders in 1982, the IMF had to step in and lead a bailout of Mexico and several emerging countries to avert a global-banking meltdown. The IMF led rescue packages to Asia in the late 1990s and supported the former Soviet Union and its Eastern Europe client states in making the transition from communism.

But the IMF's harsh austerity policies, and perception that it was insensitive to their impact on working people, have caused deeply ingrained ill-will. In South Korea, which went through a financial crisis in 1997-1998, critics bitterly remarked that the Fund's initials stood for "I'M Fired."

Indonesia's 1997 IMF program was perhaps the most intrusive and listed 140 conditions the country needed to meet, including boosting reforestation and disbanding its clove monopoly, to dismantle what economists called "crony capitalism." An IMF requirement that the Indonesia government cut fuel subsidies, which the government slashed faster than the IMF called for, led to the rioting that prompted the resignation of President Suharto in 1998.

The memory of that harsh medicine is hindering the IMF today as it tries to nudge Indonesia to clean up its state-owned banks, which account for about 40% of all lending, and privatize them. The idea is facing resistance both inside and outside the government. Indonesia's Minister for State Enterprises Sugiharto, who oversees privatization plans, is an economic nationalist who has declared publicly that Jakarta can manage its own affairs and need not heed IMF advice.

The IMF has been careful not to push too hard. "One of the lessons learned from the Asian crisis is that if a government is not itself committed to policies, the likelihood of its following through with implementing them is very limited," says Stephen Schwartz, the Fund's senior representative in Jakarta. The Fund also can't afford to lose many more clients: Indonesia is the IMF's No. 2 borrower after Turkey and accounts for about 22% of the IMF's loans outstanding -- and some Indonesians have talked about paying off the IMF early to get it off the country's back.Many developing countries are inspired to distance themselves from the IMF by the example of Argentina, which announced the payback of its $9.8 billion debt to the Fund in December, closing the books on a long tortured chapter in its history. Beginning in the early 1990s, the IMF had provided financing supporting Argentina's risky strategy to keep its peso pegged one-to-one to the dollar. The IMF overlooked warning signals that the government deficit and debt levels were expanding too much to support the currency, a 2004 IMF audit concluded.

After the economy collapsed in 2001, Argentina flouted many of the IMF's recommendations to get the country on its feet -- and has grown rapidly nonetheless. When Argentina finally attained the wherewithal to pay off the Fund last December, jubilant Argentine demonstrators released balloons saying "Ciao IMF." Contempt for the Fund runs so high in Argentina that it inspired a popular Monopoly-like board game, "Eternal Debt," in which the object is "to defeat the IMF."

[...]

Without a lending program, there is little the IMF can do to convince Argentina to change course. Argentina still receives a couple of visits a year from IMF delegations and is subject to critiques in an annual review. But Claudio Loser, a former IMF chief for Latin America, thinks the Fund's advice will fall on deaf ears. "With this government, hearing the word IMF is like hearing a curse," he says.

Bolivia is another example of the IMF's fading influence in the region. One of Latin America's poorest nations, Bolivia has borrowed repeatedly from the Fund, which has pressed the government to fight inflation through budget cuts and to encourage foreign investment through modest taxation.

In mid-February, Anoop Singh, the Latin America chief, and his top lieutenants flew to Bolivia to meet with the new regime of President Evo Morales, a leftist indigenous leader who has been critical of the IMF and has threatened to re-nationalize the energy industry. The IMF team held a town meeting with labor and indigenous leaders decked out in traditional Bolivian bowler hats. Mr. Singh, a 55-year-old Indian native, joked with the crowd that he was sorry he didn't know how speak Spanish despite "being 'Indian' himself." He parried concerns about IMF influence by informing the crowd that the Fund had written off nearly all the country's loans.

But not all of the Bolivians who attended were convinced of the IMF's good intentions. Donato Duran, a union leader, says he still believes that "the IMF only cares about rich nations and rich Bolivians." Bolivia's IMF program expired at the end of March, and Mr. Morales's critics worry that the IMF will now have little influence over the government.

When "diplomacy" means war

In a column appearing in Alternet.org, the ever-insightful Norman Solomon analyzes the White House's "faux statesmanship" and insane rush to war against Iran. Check it out here.

Media help Bush PR efforts to talk up the economy

The mainstream media have been working overtime to try to convince the American people that the economy is booming and that it's good times for the Middle Class. While the superrich have certainly been making out like bandits during the last few years, those workers who make up the majority of this countrys workforce haven't been invited to join the party.

As FAIR's Janine Jackson notes: "Wages and incomes for average workers, adjusted for inflation, are down in recent years; the median income for non-elderly households is down 4.8 percent since 2000 (Economic Policy Institute, 8/31/05). The poverty rate is rising, as is the number of people in debt."

It's not too hard to understand why millionaire meda pundits aren't too bothered by the unbalanced economic growth under the Bush administrations: The are doing quite fine, thank you. The widespread contempt for the hundreds of millions of Americans that have been screwed over by Bush's insane tax cuts and the consequent cuts in domestic spending is as predictable as it is odious.

A response to "A Lobby, not a Conspiracy"

My mom asked me to read an editorial in the New York Times about the Mearsheiemer-Walt paper "The Israel Lobby", which I have already written about at length here. Since I don't subscribe to the Times, I was fortunate to find the piece reprinted over at Commondreams. It was written by Tony Judt, a history/European Studies professor at New York University.

I agree with Judt that criticism of Israeli policy, or criticism of AIPAC, is not akin to anti-Semitism (any more than criticizing the Bush administration is anti-American). He argues that the mainstream media have chosen to remain "indifferent" to the M-W essay because of "fear of being thought to legitimize talk of a 'Jewish conspiracy'; fear of being thought anti-Israel; and thus, in the end, fear of licensing the expression of anti-Semitism."

I agree with him that most journalists and pundits in America will bend over backwards to avoid the slightest appearance of being anti-Semitic, just as they would do anything to avoid appearing racist or homophobic. Any of these impressions could likely spell the end of anyone's respectability and career.

However, is it fair to say that because an article deals with a subject matter that others find sensitive, and that when it is published it elicits such an anticipated response (or no response) it is therefore validated? I don't think so.

Say, for example, someone were to write an article claiming that even though they are a minority, blacks drive US domestic policy because of their control of the media and entertainment world. Then, after being published, the enraged black community condemns the piece, saying that it is ridiculous and not grounded in reality. The mainstream media would probably ignore the article or be rather dismissive of it. The supporters of the piece, as with the M-W piece, could then turn around and say: "See, the negative reaction to this article proves just how much power the blacks have with the US media!" You can substitute blacks with gays, Italians, women, etc.

Just as it is wrong to condemn someone as anti-Semitic because he or she criticizes the policies of a particular Israeli government or the policies of a pro-Israel lobbying group, it is also wrong to say that a negative reaction to such criticism proves the validity of its argument.

There are a number of areas where I disagree with Judt. He uses a transparent appeal to authority in bolstering the respectability of the authors as a way to make it seem credible. Thus, the London Review of Books (where the original piece was published) is a "respected" journal, and the professors are "distinguished" academics. Plenty of "respectable" media outlets have been found to publish ridiculous trash, and professors at top-flight universities have been wrong about important issues they were supposed to be "experts" in.

Second, Judt characterizes the legitimate, sincere criticism of the M-W piece to be a "firestorm of vituperation and refutation". It is indeed true that many (myself included) have pointed out a number of factual mistakes and logical inconsistencies in the piece, which after all was described by the authors as a "working paper". Harvard professor Alan Dershowitz (also a "distinguished" American academic) found tons of mistakes and disagreed with the main arguments of the article.

Judt calls such criticism a "somewhat hysterical response". Interesting. So when M-W criticize the "Jewish lobby"--and even going so far as to claim that the US's support for Israel is a "liability in the war on terror" (a claim Judt says he agrees with, without providing any evidence for)--they are "respected and distinguished" academics. But to disagree with their scholarship and analysis is merely proof that you are ignorant, intolerant and close-minded. In short, you are hysterical. This type of emotional ad hominem attack on those who dare to question M-W's piece shows Judt does not really want a debate on the article's validity to occur; he wants to paint all of its critics with a broad brushstroke as being unreasonable and slightly crazy. Judt claims the paper was based on "standard sources" and is "mostly uncontentious". Of course, if you disagree with this unsupported assertion, you are being hysterical.

Judt ends his op-ed with the following:

Thus it will not be self-evident to future generations of Americans why the imperial might and international reputation of the United States are so closely aligned with one small, controversial Mediterranean client state. It is already not at all self-evident to Europeans, Latin Americans, Africans or Asians. Why, they ask, has America chosen to lose touch with the rest of the international community on this issue? Americans may not like the implications of this question. But it is pressing. It bears directly on our international standing and influence; and it has nothing to do with anti-Semitism. We cannot ignore it.

So there you have it in Judt's own words. Israel is a "controversial" state. What does that mean? I can understand a politician, policy or administration being controversial, but a country recognized by the UN and the world community? By controversial, does he mean to imply that their very existence is controversial? If not, what does he mean? Next, referring to Israel as a "client" state of the US really takes the cake. A client state means "a state that is subservient to another state". This contradicts M-W's thesis, that it is Israel that is controlling US foreign policy, not the US controlling Israel's policy.

He remarks: "...the Holocaust is passing beyond living memory. In the eyes of the watching world, the fact that an Israeli's great-grandmother died in Treblinka will not excuse his own misbehavior." I find this statement so offensive, so asinine that I'm surprised frankly that the Times would publish it. It betrays Judt's mindset that he would insinuate that Israelis implicitly justify their misdeeds (presumably against Palestinians) by appealing to their suffering in the holocaust (as opposed to legitimate concerns for self-defense) is truly disgusting.

Finally, the loaded question as to why the US has "chosen" to lose touch with the "international community" is ridiculous and offensive on its face. What does he mean by the "international community" and what specific issues have we lost touch with them on vis-à-vis Israel? If merely being "closely aligned" with Israel--the only democracy in the region with freedom of speech, freedom of religion, freedom to assemble--is the reason why we're losing touch with the international community, maybe it's better we lose touch with them.

In conclusion, I don't think Judt is anti-Semitic, I think he is disingenuous and seems hostile to the very existence of a "controversial" Jewish state in the Middle East.

Rumsfeld claims war critics's attitudes are being "manipulated" by terrorists

Donald Rumsfeld has got to go. It's not bad enough he is claiming critics of the ongoing Iraqi war are wrong to question his competency, which shows he possesses a remarkable degree of stupidity and stubburn avoidance of the facts on the ground. Pretty much anyone with a functioning brain cell knows the war is a disaster with no possibility of achieving its objectives (whatever those were).

No, now Rumsfeld goes on a national radio program (Rush Limbaugh's or course) to complain that those "anti-war" elements in the country must be grudgingly accepted, even though they are being manipulated by bin Laden and Zarqawi into holding their beliefs.

Of course he offers no evidence supporting this asinine viewpoint, mainly because no such evidence exists on planet earth. But I think this really does represent a new low for Rumsfeld to claim the hundreds of millions of Americans who are critical of the US war in Iraq (71 percent of those polled last month by the Kentucky Lexington-Herald say the war's costs outweigh the benefits, by the way) are so weak-minded that they have fallen prey to al Qaeda's propaganda efforts.

WH offers Fox News host Press Secretary job

The "fair and balanced" Fox News has confirmed the reports that Tony Snow has been approached by the White House for the position of propaganda minister. No bid surprise--as a Fox News pundit and former George H.W. Bush speechwriter, Snow has plenty of experience lying and spinning.

This should--in theory at least--make it that much more difficult for anyone with half a brain to consider Fox News to be "fair and balanced", with one of its top hosts being on the short-list of the Bush administration's favorite point men to spread its lies (ie, talking points).

Hamas calls suicide bombing "legitimate"

Suicide bombing in Tel Aviv kills 9, injures dozens.

AP reports: "The new Palestinian government, led by Hamas, called the attack a legitimate response to Israeli 'aggression.'"

The Palestinian people are going to be very sorry they elected these terrorists to run their government.

Refusing to pay taxes: Civil disobedience and the Iraq war

Christian Science Monitor has an interesting piece on some modern-day Henry David Thoreaus who are refusing to pay their taxes to protest the ongoing war in Iraq. The number of such protestors is estimated at about 10,000--and growing.

According to the White House, 19 cents of every tax dollar goes to military spending, although many tax resisters believe the number is much higher, with some saying the figure may be as high as 42 cents. Some protestors have withheld all of their taxes and others have withhold the percentage they believe gets earmarked to military spending, Others have refused to even file a 1040, and instead donated the money to charities of their choice.

Is this type of civil disobedience more effective than engaging in public marches, writing letters to Congress or blogging in your free time? I'm not sure, the money involved is truly negligable to the IRS's coffers, but there is no doubt a lot of bravery involved in openly refusing to pay your taxes due to your personal convictions. I've been known to complain about the indifference of most Americans who, although they disagree with Bush's invasion of Iraq, have not been moved to do or say anything about their feelings. Apparantly, there is some hope.

Profile in Courage: John Edwards

Commondreams profiles former North Carolina Senator, 2004 Presidential Candidate (and eventual Democratic VP nominee) John Edwards. It discusses how unlike most high-profile politicians, he not only talks that talk about fighting poverty, he actually walks the walk. He has made some great comments, such as "The best anti-poverty strategy is a strong labor movement." and "Can we still really call America the land of opportunity when hotel workers who work full time for profitable hotel companies cannot afford to make ends meet?" Mr. Edwards said. "This is not just unjust. It is immoral, and we need to do something about it."

According to the article, Edwards is still trying to figure out how to frame his poverty message, making it a moral issue and attempting to appeal to the consciences of middle class America.

Edwards hope is that America is ready to elect a president who inspires idealism (think Bobby Kennedy) rather than triangulates with caution (think Clinton). The article notes he appears to be positioning himself to the left of Hillary, Mark Warner and Bill Richardson. He is trying to eescape from the failed policies (and failed campaign efforts of) DLC-style centrism and trying to position himself as an "advocate for a new New Deal in this era of corporate downsizing and globalization." Unlike the DLC, he is boldly supporting unions and argues for the importance of reforming labor laws to strength the right to organize.

The article concludes:

"No doubt Edwards is already hearing from political consultants, editorial writers, and many of the Democratic Party's corporate funders, that resurrecting the moral idealism of Bobby Kennedy is no way to win the White House.

But with a fire in his belly that seems genuine, Edwards is hoping to prove that promoting an agenda of prosperity, opportunity and compassion can win the hearts and minds of America's affluent, its beleaguered middle class, and the working poor. If he's correct, the son of a mill worker might become the next president of the United States."

Read the whole piece. Along with Russ Feingold, I think John Edwards is shaping up to be among the most promising presidential candidates in 2008.

Investor class gets justice in corporate crime, but...

Lee Drutman, always a provocative writer, really hits a home run with this one.

Now, I would not for a moment suggest that federal prosecutors should not be pursuing the Enron case with all the force in the world. Enron remains one of the most spectacular corporate frauds ever, and to let the folks who cooked it up off the hook would be a travesty of justice.

But at the same time, I also think it’s important to take a step back and remember what it is that Lay and Skilling are being prosecuted for. They are being prosecuted for bluffing about the financial health of their company—which allowed them to make off with millions by selling their stock high while unwitting investors were left holding the bag.

This is a serious crime, and it is true that many Enron employees had their whole pensions in Enron stock and subsequently lost everything. But it is also true that the roughly half of the stock out there is owned by the wealthiest 1 percent of Americans. As far as classes of victims go, investors tend to be a pretty privileged class.

Perhaps, then, it is not surprising that the face of “corporate crime” has come to be defined largely by Enron, WorldCom and other cases of accounting fraud where the victims are primarily wealthy investors. Nor should it seem surprising that corporate reform and corporate accountability is still largely discussed in reference to the Sarbanes-Oxley Act, which dealt almost exclusively with curbing accounting fraud. After all, investors are a pretty powerful political class.

Yes, financial fraud is a serious crime; and yes, reforms are needed and violators ought to be pursued with the full force of the law. But all this must not distract us from the fact that when the victims are not wealthy investors, the same force of response is often lacking.

Baker, Sawicky and Faux on immigrants and low-wage jobs

A must-read post from Dean Baker's new blog:

One of the great absurdities in the debate over immigration policy is the frequently repeated claim that the U.S. economy is generating more “low wage” jobs than can be filled by the domestic workforce. This line has been endlessly repeated in news stories on the issue.

Quick trip back to econ 101: recall the concepts “supply” and “demand.” What makes a job a “low wage” job? In econ 101 world, a job will be a “low wage” job if the supply is high relative to the demand. When there is insufficient supply, then the wage rises. My students didn’t pass the course if they couldn’t get this one right. Econ 101 tells us that there is not a shortage of workers for low wage jobs; it tells us that there are employers who want to keep the wages for these jobs from rising.

Immigration has been one of the tools that have been used to depress wages for less-skilled workers over the last quarter century. Many of the “low-wage” jobs that cannot be filled today, such as jobs in construction and meat-packing, were not “low-wage” jobs thirty years ago. Thirty years ago, these were often high-paying union jobs that plenty of native born workers would have been happy to fill. These jobs have become hard to fill because the wages in these jobs have drifted down towards a minimum wage that is 30 percent lower than its 1970s level.

In response to this logic, the “low wage” job crew claims that if the wages in these jobs rose, then businesses couldn’t afford to hire the workers. It’s time for more econ 101. Businesses that can’t make money paying the prevailing prices go out of business – that is how a market economy works. Labor goes from less productive to more productive uses. This is why we don’t still have 20 percent of our workforce in agriculture.

So the economic side of the debate over immigration is a question about employers wanting access to cheap labor. That part is pretty simple. There are other questions in this debate about human rights and basic decency. It’s outrageous to threaten people with deportation and imprisonment who have worked in this country as part of a conscious government policy. (No one enforced employer sanctions. That was a deliberate decision by the government.)

[...]

U.S. trade negotiators have not pursued such policies, because trade and immigration policy has been deliberately intended to redistribute income upward. We can debate whether this is a desirable goal for trade policy, but only if the media stops making silly claims about “low wage” jobs.

And from MaxSpeak:

The efficacy of labor supply limitations is one question. Another is the practicality of that approach applied to immigration. A third is the political consequence. I think the answers to all of these are contestable.

What seems less open to doubt is a more birds-eye view of U.S. historical experience. Waves of immigration in the past gave rise to struggles among workers -- stoked by employers -- for what was perceived as a limited number of jobs. Perverse mythologies regarding race, ethnicity and religion blossomed in this setting leaving malign, long-lasting effects.

Ultimately the number of jobs -- the 'lump of labor' (sic) -- was not limited. Immigrants fought their way into politics and fueled the rise of the labor movement, which in turn made the country a better place in all kinds of ways. The old exclusionist-collaborationist AFL sort of "business unionism" was swept aside. Labor went from cheap to dear. In 1969 the "Woodstock minimum wage" of $1.30 was $7.03 in today's dollars. It did not go downhill later because of immigration.

I did not say it would be fun for everyone. But it's where we are.

Finally, EPI founder Jeff Faux (author of the excellent The Global Class War) weighs in with an op-ed called "Dealing With Mexico". The complete article can be read here.

Why the minimum wage is a winning issue

Froma Harrop, writing in TomPaine explains how in the absence of any activity or interest from Congress in raising the minimum wage, now at a 50-year low in relative dollar terms, some states have taken the lead in addressing the critical issue for low-income Americans. Some state legislatures, including New York and Maryland, have even overridden vetos from their governors.

The article notes that this is an issue with real political legs behind it:

"The political ramifications go beyond setting a wage floor. Putting such bread-and-butter questions on the ballot could help progressive candidates by bringing more liberals to the polls, as well as low-income voters, who, sadly, often bypass elections. Such a turnout might be especially helpful to Democratic candidates for governor in Arizona and Ohio."

And the myth that raising the minimum wage is anti-business and will result in an increase in unemployment is confronted head-on:

A recent study by the Fiscal Policy Institute in New York confirms this view. It found that small businesses actually grew faster in states that kept their minimum wages above the federal level. From 1998 to 2003, job growth for small businesses in states with higher minimum wages was 6.7 percent, versus 5.3 percent in states stuck at $5.15 an hour.

Surprisingly, job growth was even more robust in the retail sector, where the wages tend to be low. And the total number of small retail businesses grew 0.6 percent in high-minimum-wage states, while they actually fell 0.3 percent in states that relied on the federal standards.

What is the explanation? Part of it is that higher wages lead to higher productivity. That is, the workers get more done in the same amount of time. The better pay encourages them to stay at the job and gain experience. And employers don't have to waste resources finding and training new people.

The report also notes what economists call the "Henry Ford effect": If you pay workers more, they can buy more. That boosts the overall local economy. And the biggest winners are the small retail businesses, who, according to the propagandists, are supposed to be hurt most.

This is an issue I've been talking about for years--what gay marriage and abortion are for the right, increasing the minimum wage and making it a "living wage" is for the left, an issue sure to galvanize the base and bring in votes.

Iran nuclear strike watch

Can anyone stop Bush from launching a preemptive nuclear strike against Iran?

And would anyone even care if he does?

Digby and Billmon seem to think the answer to both questions is 'no'. I pray they're both completely wrong and that we can laugh about all this in ten years. After all, maybe it is all part of an elaborate psy-ops campaign being waged by Washington against Iran, as some have been speculating.

But it's looking less and less likely now that the Iranian president is bragging about his country joining the Nuclear Club.

Update: Well, maybe Iran's nuclear bomb-making ability is ten years away.

Update #2: The neocon drumbeat to war continues.

The big lie

George W. Bush has been caught in a bald-face lie about leaks coming out of the White House--leaks that involved providing information from the previously classified National Security Estimate to New York Times "journalist" Judith Miller. It was leaked to help the administration sell the legitimacy of the Iraq war to the American people after the legitimacy of their case was called into question by an editorial penned by Joseph Wilson in the Times. His wife, a covert CIA operative, was outed and became collateral damage as a result of its the publication. According to court papers filed by Dick Cheney's former chief of staff "Scooter" Libby, authorization (and obviously encouragement) for leaking the info to the media came directly from Bush himself.

As E.J. Dionne points out in the Washington Post, the problem is two-fold: One, is it illegal/ethical for Bush to have authorized the leak? It appears that Bush had the legal ability to declassify the document, and thus by authorizing its "leak" as part of a PR blitz, he wasn't violating the law (although the New York Times, not surprisingly, disagrees).

Fine. But Bush also made believe leading up to the 2004 election that he didn't know who leaked the report to the media, and that he wanted to know who did it and have that person fired. He also attacked New York Times late last year after it published information it had received as part of a leak involving the administration's illegal wiretapping scheme on international phone calls involving US citizens.

Bush can't have it both ways. He can't leak info to the media in a pathetic attempt to manipulate public opinion regarding the justification of a war, and then get caught authorizing those leaks while pretending he had no idea what the source of the leaks are, criticizing them and calling for an investigation. And he can't say that the same media are aiding the enemy in the "War on Terror" when it reports on illegal spying from the administration.

This enormous scandal is no longer front page news. Why not?

Great news in the blogging world

Yet another Troubled Times hat tip goes out to Mitchell Freedman for alerting me to the fact that Dean Baker has launched a new blog Beat The Press. It looks like this new project is replacing the indispensible 10 year old Economic Reporting Review over at the Center for Economic Policy Research, a weekly review of financial reporting at the New York Times and the Washington Post. A few years back, when I had considerably more free time, I used to read it every week and it truly changed my percepitons on how the major media covers economic issues. I would even say much of my current interest in economic policy traces back to my discovering the ERR.

Needless to say, I have very high expectations for Beat the Press, although I'm sure I won't be disappointed.

My Mom keeps asking me which "pundits"/writers I like and respect the most. I've been trying to draft a list of my top ten for her (she is fairly progressive so I think we might share similiar tastes), but without question Baker is on the short list.

Is the Democratic Establishment better than the GOP on supporting the Middle Class?

Georgia10 from DailyKos thinks Lou Dobbs and others are giving Democrats short shrift by not recognizing their efforts to enact pro-Middle Class economic policies. I think the DNC has a lot of work to do.

Cooper and Bentley

My parents' dogs, both King Charles Cavaliers.

My take on the Mearsheimer-Walt working paper

As much as it pains me to agree with the likes of Charles Johnson from LGF and his fringe right-wing brethren at Free Republic, I have to say I agree with Alan Dershowitz's rebuttal of the John Mearsheimer-Stephen Walt (professors at University of Chicago and Harvard's Kennedy School of Government, respectively) "working paper" that argues the Israeli Lobby (AIPAC) manipulates US foreign policy toward nefarious ends. Besides, David Duke has made good use of the working paper's conclusions on his hate site, so I'm not too worried about being found "guilty by association".

To provide a little context for the authors' arguments, in their own words, the working paper starts off by saying:

"Beginning in the 1990s, and even more after 9/11, US support has been justified by the claim that both states are threatened by terrorist groups originating in the Arab and Muslim world, and by ‘rogue states’ that back these groups and seek weapons of mass destruction. This is taken to mean not only that Washington should give Israel a free hand in dealing with the Palestinians and not press it to make concessions until all Palestinian terrorists are imprisoned or dead, but that the US should go after countries like Iran and Syria. Israel is thus seen as a crucial ally in the war on terror, because its enemies are America’s enemies. In fact, Israel is a liability in the war on terror and the broader effort to deal with rogue states."

(snip)

"[S]aying that Israel and the US are united by a shared terrorist threat has the causal relationship backwards: the US has a terrorism problem in good part because it is so closely allied with Israel, not the other way around. Support for Israel is not the only source of anti-American terrorism, but it is an important one, and it makes winning the war on terror more difficult. There is no question that many al-Qaida leaders, including Osama bin Laden, are motivated by Israel’s presence in Jerusalem and the plight of the Palestinians. Unconditional support for Israel makes it easier for extremists to rally popular support and to attract recruits."

(snip)

"Israel is often portrayed as David confronted by Goliath, but the converse is closer to the truth. Contrary to popular belief, the Zionists had larger, better equipped and better led forces during the 1947-49 War of Independence, and the Israel Defence Forces won quick and easy victories against Egypt in 1956 and against Egypt, Jordan and Syria in 1967 – all of this before large-scale US aid began flowing. Today, Israel is the strongest military power in the Middle East. Its conventional forces are far superior to those of its neighbours and it is the only state in the region with nuclear weapons. Egypt and Jordan have signed peace treaties with it, and Saudi Arabia has offered to do so. Syria has lost its Soviet patron, Iraq has been devastated by three disastrous wars and Iran is hundreds of miles away. The Palestinians barely have an effective police force, let alone an army that could pose a threat to Israel. According to a 2005 assessment by Tel Aviv University’s Jaffee Centre for Strategic Studies, ‘the strategic balance decidedly favours Israel, which has continued to widen the qualitative gap between its own military capability and deterrence powers and those of its neighbours.’ If backing the underdog were a compelling motive, the United States would be supporting Israel’s opponents."

This sets up the basic thesis: Israel is not the underdog and doesn't need US backing. Then the authors shift rhetorical gears.

"Some aspects of Israeli democracy are at odds with core American values. Unlike the US, where people are supposed to enjoy equal rights irrespective of race, religion or ethnicity, Israel was explicitly founded as a Jewish state and citizenship is based on the principle of blood kinship. Given this, it is not surprising that its 1.3 million Arabs are treated as second-class citizens, or that a recent Israeli government commission found that Israel behaves in a ‘neglectful and discriminatory’ manner towards them. Its democratic status is also undermined by its refusal to grant the Palestinians a viable state of their own or full political rights."

Interesting, So by "refusing" to give the Palestinians their own viable state, Israel is not a democracy? I guess the US's decision not to grant Native Americans with their own viable state would qualify us as something less than a democracy. The fact that arabs living in Israel have more political rights and greater freedom than arabs in any other country in the Middle East apparantly doesn't factor into the equation.

Next comes an even more preposterous claim:

"A third justification is the history of Jewish suffering in the Christian West, especially during the Holocaust. Because Jews were persecuted for centuries and could feel safe only in a Jewish homeland, many people now believe that Israel deserves special treatment from the United States. The country’s creation was undoubtedly an appropriate response to the long record of crimes against Jews, but it also brought about fresh crimes against a largely innocent third party: the Palestinians."

There is no question the State of Israel has in the past, and continues to this day, to commit human rights violations against the Palestinian people, as the latest reports from Amnesty International or Human Rights Watch make clear. But to say the Palestinian people are "largely innocent third parties" is a whitewash of history and fact. Both sides deserve a great deal of blame for their conduct and crimes, and to portray Palestinians as being only innocent victims demonstrates a clear bias against the State of Israel.

After multiple paragraphs cataloguing the crimes of the Israelis against the Palestinians, the authors have a short two-sentance dismissal of any Palestinian wrongdoing. "The Palestinian resort to terrorism is wrong but it isn’t surprising. The Palestinians believe they have no other way to force Israeli concessions" One must presume the authors would likewise give al Qaeda with a pass for their terrorist attacks on September 11 because it was the "only way" it could force concessions from the US on its demands for US troop withdrawl from Saudi Arabia, etc.

Turning next to the "Israel Lobby", which the authors believe is the main reason why the US supports Israel (since they conclude there is no moral justification for doing so), they state:

"The Lobby pursues two broad strategies. First, it wields its significant influence in Washington, pressuring both Congress and the executive branch. Whatever an individual lawmaker or policymaker’s own views may be, the Lobby tries to make supporting Israel the ‘smart’ choice. Second, it strives to ensure that public discourse portrays Israel in a positive light, by repeating myths about its founding and by promoting its point of view in policy debates. The goal is to prevent critical comments from getting a fair hearing in the political arena. Controlling the debate is essential to guaranteeing US support, because a candid discussion of US-Israeli relations might lead Americans to favour a different policy." What "myths" are being propogated? Why is a candid discussion made impossible due to a lobbying group? The authors don't deign to answer these logical questions.

Then comes the most disingenuous line of argument of all: The Iraq war was done at the bidding of the Israeli puppet-masters and therefore all their fault:

"Maintaining US support for Israel’s policies against the Palestinians is essential as far as the Lobby is concerned, but its ambitions do not stop there. It also wants America to help Israel remain the dominant regional power. The Israeli government and pro-Israel groups in the United States have worked together to shape the administration’s policy towards Iraq, Syria and Iran, as well as its grand scheme for reordering the Middle East.

Pressure from Israel and the Lobby was not the only factor behind the decision to attack Iraq in March 2003, but it was critical. Some Americans believe that this was a war for oil, but there is hardly any direct evidence to support this claim. Instead, the war was motivated in good part by a desire to make Israel more secure. According to Philip Zelikow, a former member of the president’s Foreign Intelligence Advisory Board, the executive director of the 9/11 Commission, and now a counsellor to Condoleezza Rice, the ‘real threat’ from Iraq was not a threat to the United States. The ‘unstated threat’ was the ‘threat against Israel’, Zelikow told an audience at the University of Virginia in September 2002. ‘The American government,’ he added, ‘doesn’t want to lean too hard on it rhetorically, because it is not a popular sell.’"

Putting aside the fact that Israel was attacked by Iraq during the Gulf war, is it really any surprise that Israel would consider it in their strategic interest to overthrow Saddam Hussein, who had openly bragged about being set on destroying the State of Israel, financed suicide bombings in Israel and was building a nuclear reactor in the 1980s that Israel destroyed?

Stephen Zunes from Foreign Policy in Focus has many more reasons for why it is wrong to blame Israel for the Iraq war here. He argues:

While AIPAC undeniably has influenced Congressional votes regarding Israeli-Palestinian concerns and related issues, they did not play a major role lobbying members of Congress to vote in favor of the resolution authorizing a U.S. invasion of Iraq, in large part because they knew there was such overwhelming bipartisan support for invading that oil-rich country they did not need to. More fundamentally, there are far more powerful interests that have a stake in what happens in the Persian Gulf region than does AIPAC, such as the oil companies, the arms industry, and other special interests whose lobbying influence and campaign contributions far surpass that of the much-vaunted “Zionist lobby” and its allied donors to Congressional races.

The American Jewish community, like most Americans, is turning against the war. Rabbi Eric Yoffie, president of the Union of American Hebrew Congregations, along with its chairman of the board, Robert Heller, recently sent a letter to President Bush stating that “We call not only for a clear exit strategy but also for specific goals for troop withdrawal to commence after the completion of parliamentary elections.”

I recommend reading the Dershowitz piece. I don't agree that anyone who criticizes Israel or the Israel lobby is an anti-Semite, but I think as the authors' own words demonstrate, there is a clear bias against Israel: the Israelis are an all-powerful cabal who control the US Congress, Executive Brance and the media while the Palestinians are basically a victimless, blameless party with no sway over the debate. I think this characterization is extremely facile at best, and misleading at worst, and Dershowitz goes a long way to disproving the inaccuracy of many of these claims.

I have no doubt that many of my colleagues on the Left will disagree with my position on this, but I think both the Israeli and Palestinian people have commited many crimes and played a role in perpetuating the crisis in the Middle East and both deserve blame. I also don't think enough evidence has been presented that AIPAC controls the US government or media, except for some cherry-picked quotes and anecdotal evidence.

Update: Seems Chomsky disagrees with the M-W paper's thesis as well, for some of the same reasons he discounts 9/11 consipracy theories...because it ignore the role the people in power play in making decisions and thus the need to hold them accountable as opposed to blaming ancillary players.

He concludes:

"The thesis M-W propose does however have plenty of appeal. The reason, I think, is that it leaves the US government untouched on its high pinnacle of nobility, "Wilsonian idealism," etc., merely in the grip of an all-powerful force that it cannot escape. It's rather like attributing the crimes of the past 60 years to "exaggerated Cold War illusions," etc. Convenient, but not too convincing. In either case."

Of course I disagree of different grounds, but nevertheless, there you have it.

Analyzing the new MA health care bill

MyDD has an interesting post on the real story behind the new Massachussets health care bill, and why it is far inferior to what is actually needed to make the system work for American citizens. Go check it out.

Hersh: Bush planning on nuking Iran

Thinkprogress has the rundown.

A direct link to the full article by Hersh in The New Yorker is here.

Hersh is a journalist I respect a lot, and I think his track record as a reporter is extremely impressive. He's broken a lot of major stories in the past few decades, and I consider him to be a very credible source. If he is even close to right about Bush's plans for Iran, then everyone should be very, very concerned.

Very concerned.

EPI criticizes new Census Report's poverty measurement

I noted an article from In These Times about a month ago regarding methodological problems in the way the US government officially measures and records the poverty level--problems that obviously have significant negative policy implications. The Economic Policy Institute recently released a report on the issue, which can be accessed in its entirety here.

The report concludes:

The Census Bureau says its new report is meant to provide “a more complete measure of economic well-being,” but the report ignores issues such as child care and medical expenses that Census staff, with help from outside experts, included in many past estimates of poverty under a comprehensive, revised poverty standard.

In addition, by not following some of the key recommendations made by the National Academy of Sciences regarding improved poverty measurement — most notably, to use poverty thresholds that are consistent with the measure of income being used — and by not including or discussing the NAS-guided measures of poverty, the new report presents an
overly positive view of the extent of poverty in America.

It would be of particular concern if the Census Bureau plans to continue publicizing only those poverty rates that are much lower than the current rate, and providing no indication that the lower rates are derived from poverty measures that are controversial in the research community and that many researchers regard as flawed.

Indeed, this should be an important policy concern for anyone concerned with the issue of poverty, and it is unfortunate that it is not being covered more prominently by the national media.

Libby claims Bush approved his Iraq intel leak to Judith Miller

Hot off the wires, "scooter" Libby claimed in grand jury testimony that he had received "approval from the President through the Vice President" to divulge portions of a National Intelligence Estimate regarding Saddam Hussein's purported efforts to develop nuclear weapons

From the AP:

Vice President Dick Cheney's former top aide told prosecutors President Bush authorized the leak of sensitive intelligence information about Iraq, according to court papers filed by prosecutors in the CIA leak case.

Before his indictment, I. Lewis Libby testified to the grand jury investigating the CIA leak that Cheney told him to pass on information and that it was Bush who authorized the disclosure, the court papers say. According to the documents, the authorization led to the July 8, 2003, conversation between Libby and New York Times reporter Judith Miller.

There was no indication in the filing that either Bush or Cheney authorized Libby to disclose Valerie Plame's CIA identity.

But the disclosure in documents filed Wednesday means that the president and the vice president put Libby in play as a secret provider of information to reporters about prewar intelligence on Iraq.

So there you have it, grand jury testimony from Cheney's former Chief of Staff that authorization for the leak went all the way to the top.

"The fact that the president was willing to reveal classified information for political gain and put interests of his political party ahead of Americas security shows that he can no longer be trusted to keep America safe," Democratic National Committee Chairman Howard Dean said.

Libby's testimony also puts the president and the vice president in the awkward position of authorizing leaks — a practice both men have long said they abhor, so much so that the administration has put in motion criminal investigations to hunt down leakers.

Indeed...

More coverage from the National Journal:

Libby also testified that an administration lawyer told him that Bush, by authorizing the disclosure of classified information, had in effect declassified the information. Legal experts disagree on whether the president has the authority to declassify information on his own.

How Bush lost Latin America

Some sobering analysis courtesy of BBC News regarding US-Latin American relations and how bad they have become in the last five years. According to the (unnamed) author, both Nicaragua and Peru might soon elect left-wing populist, explicitly anti-Yanqui presidents in the near future. Daniel Ortega in Nicaragua would be a particular embarassment to this Bush administration for obvious historical reasons (think Iran-contra), and as the article notes, Ollanta Humala is following the same successful strategy of Hugo Chavez and of Evo Morales of Bolivia to court votes--the enormously popular the anti-globalization/anti-US argument.

The next country to fall to a strongly anti-American populist politician could be Peru.

Voters there go to the polls on 9 April to elect a president and Congress.

The presidential frontrunner is Ollanta Humala, a retired army commander who led a failed military uprising in October 2000 and who is now ahead in the opinion polls.

Now, opinion polls in Peru are not especially reliable. They under-represent poor voters in the countryside.

But that is the point. The rural poor form the backbone of Mr Humala's support. If he is ahead even in the flawed opinion polls which tend to under-count his key constituency, Mr Humala is confident he can take the presidency.

And if he does, there will be more ulcers in George Bush's White House.

Like President Hugo Chavez in Venezuela and President Evo Morales in Bolivia, Mr Humala talks of the evils of what he calls "the neo-liberal economic model that has failed to benefit our nation".

He dismisses the role of multinational companies that "offer no benefits" to the people of Peru, and he speaks of a new division in the world.

Where once Cuba's Fidel Castro could harangue the US with talk of the colonisers and the colonised, Ollanta Humala attacks globalisation as a plot to undermine Peru's national sovereignty and benefit only the rich on the backs of Latin America's poor.

It will be interesting to see just how much worse our relationship with Latin America will be in 2008, and how long it will take for us to repair them. And it doesn't seem likely that without addressing the root causes of this anti-globalization sentiment that public opinion toward the "developed" world in the region will improve all that much.

Update: Marc Weisbrot from the Center for Economic Policy Research has some valuable background on the economic issues involved in the Peru election.

Also, an article on the elections, and their challenge to the IMF, World Bank and Washington Consensus, from In These Times.

Organized labor in the US needs to get its act together

Read this article by one of the country's foremost experts on US labor, Thomas Palley, to get a sense of just how disorganized labor is with the battle between Change-to-Win and the AFL-CIO (that terrible pun is Palley's, but I just couldn't resist). I've been following this story for awhile, and it's more than a little disheartening to see how this is all playing out.

As Pally explains, CTW, which split from the AFL-CIO, has a different strategy to combat the decline in union membership and influence than the latter. But rather than let this disagreement effectively divide labor against itself, there should be a head-to-head debate between the organizations to figure out a united strategy for dealing with the forces of globalization, outsourcing, privatization and labor market flexibility.

Rush Limbaugh calls alleged Duke rape victim a "ho"

You just can't make this stuff up.

From the March 31 edition of The Rush Limbaugh Show:

CALLER 1: Why is it, do you think, that you haven't heard hardly anything from Jesse Jackson or Al Sharpton about the whole immigration thing? I mean, the silence is deafening from --

LIMBAUGH: Well, they're busy.

CALLER 1: -- the NAACP [National Association for the Advancement of Colored People] and the --

LIMBAUGH: They're -- they're busy. They're busy. The Reverend Jackson is in New Orleans. He's leading a big march there tomorrow. The march is -- what is it called? The -- the march for the right to return a protected vote and reconstruction. He's trying to -- they got problems down in New Orleans. They don't have voter base, and Sharpton's working on a New Orleans deal, too. He's trying to figure out how he can get involved in the deal down there at Duke where the lacrosse team --

CALLER 1: Yeah.

LIMBAUGH: -- uh, supposedly, you know, raped, some, uh, hos.

CALLER 1: But I don't think they're very happy about all of this.

LIMBAUGH: Yeah, well, but, the problem -- that -- that has a possibility down -- that Duke thing's got a possibility of being a Tawana Brawley situation. That -- and Sharpton's got a balance -- can he afford another one of those as -- as his life's going on? New Orleans is a big deal to him, and I -- I'm gonna tell you something. You'll -- you'll see these guys -- at some point, they will get involved, be-because when Ted Kennedy calls it the new civil rights movement, that's Jesse Jackson's turf. He owns it. So --

CALLER 1: Right.

LIMBAUGH: Yeah, anyway, I gotta run here because of the constraints of time out there. [Caller], a great, great question. Uh, exotic dancer, OK, say rape -- whatever happened. You know what it is down there at Duke. It's -- you watch what happens in that. That's --

[...]

LIMBAUGH: It's open-line Friday, and I am Rush Limbaugh, America's anchorman and your host for life. This is -- this is [caller] from Bryant, Texas. Hello, [caller], great to have you with us.

CALLER 2: Rush, did you just call those young ladies "hos" on the nationally syndicated program?

LIMBAUGH: Yes.

CALLER 2: Do you know something about them that perhaps we don't know?

LIMBAUGH: Yes, yes I did.

CALLER 2: Oh, you --

LIMBAUGH: It was a, it was -- hang on -- now, what, what did you say there, [caller]?

CALLER 2: I said, because -- and if they are hos, it doesn't mean that they can still -- you can do to 'em whatever you want.

LIMBAUGH: No.

CALLER 2: Well, why would you call them hos on the national --

LIMBAUGH: Well, because, because I'm running on fumes today, [caller], and I felt terrible about it. And I knew somebody was gonna call and give me a little grief so I'm takin' the occasion of your call to apologize for it. That was, it was a terrible slip of the tongue. I'm sorry. But it wasn't the worst one that has been said recently. You want -- do you know who Keanu Reeves is?

Taming global capitalism: Some suggestions

The Nation has a fantastic panel discussion from some of the world’s most important economists and critics of globalization that provides more than the usual litany of complaints and finger-pointing. Heavy-hitters, including Joseph Stiglitz, James Galbraith and Jeff Faux, actually offer up some recommendations for democratizing capitalism and instituting policies that would make the forces of globalization benefit everyday workers as opposed to the elite global investor class.

These are not the rantings of obscure Marxists or radical IMF protestors, they are the thoughtful analyses of former Nobel prize-winners and well-respected economists from academia and think-tanks. If you think that the course of globalization has been predetermined, this article offers some sliver of hope. If some of these suggestions—investing in education, making tax regimes more progressive, focusing on full-employment instead of inflation, encouraging savings among low-income workers—are implemented, globalization can be moderated and democratized.

Amending by-laws another strategy for shareholder activism

I wrote last week about the importance of shareholder activism in reforming the corporate governance abuses at major US corporations and discussed the role large pension funds were playing in pushing forward dissident resolutions. In today’s Wall Street Journal (subscription required), there is some coverage of another tactic activists are taking that may in the long-run be even more effective: Changing the by-laws of the corporation. The by-laws, as the article explains, are basically the “constitution” of the corporation. They legally govern what a corporation can or cannot do in minute detail, everything from the composition of the Board of Directors to where the corporation is incorporated.

The article makes clear that this is a radical strategy and is certainly going to be an uphill battle. Advocates of this approach express weariness at the sysiphysian struggle of getting resolutions implemented by the Board after the struggle to get them passed is finally over. Since these resolutions are often not legally binding—as changes to the by-laws are—the Board is free to completely ignore them.

Some major pension funds like CALPERS and AFSCME have been pushing forward with this with some success and anyone interested in the future of shareholder activism in ensuring responsible practices at the corporations they own should closely track the continued development of this trend.

Daniel Gross channels Jeff Faux

Great article by Daniel Gross in yesterday's New York Times, (hat tip to my professor John Gershman at NYU) although pretty much all of his points have been anticipated and written about with more eloquence and detail by Jeff Faux in his recent must-read The Global Class War.

Here's the text of the Gross article (due to TimesSelect), but if you are in the least bit interested in understanding the dynamics of what is going on in the battle between global capital and global labor--and how the WTO and its rules are helping capital win the battle and rip up the social contract that has existed for generation--you have to read Faux's book.

Invest Globally, Stagnate Locally
By DANIEL GROSS


IN the United States and Europe, there has been a curious disconnect in recent years between the performance of the corporate sector and the performance of the overall economy.

For example, median incomes for American workers have barely budged since 2000, while corporate profits have nearly doubled. In Germany, wages have fallen in real terms in the last two years, while earnings for the companies in the DAX 30 index have more than doubled. And in Germany and much of the rest of Europe, the overall pace of economic growth has remained sluggish.

"All in all, the widespread prosperity of companies does not lead to prosperity for domestic economies or wage earners in Germany, France or Japan," wrote Patrick Artus, chief economist of IXIS, the Paris bank, in a recent report.

In theory, corporate profits and wages shouldn't be a zero-sum game. Rising corporate profits are supposed to stimulate investment, which leads to job creation and rising consumer demand, which in turns tends to push up wages. But that process has broken down, at least within national borders, thanks to two related trends that stem largely from globalization.

It's a truism in the large developed economies that capital is strong and labor is weak. From 2001 to the fourth quarter of 2005, corporate profits as a percentage of United States G.D.P. rose significantly, to 11.6 percent from about 7 percent. Companies have been able to keep a larger share of the cash they generate, rather than pay it out in wages, in part "because the labor market recovery has been weak," said J. Bradford DeLong, professor of economics at the University of California, Berkeley. Professor DeLong notes that while unemployment is low, other measures of labor-market health, from hours worked to the employment-to-population ratio, show it to be less than robust.

In Europe, where unions remain strong, the growing ability and desire of French and German companies to invest beyond borders gives management new leverage over labor. "Capital has mobility in Europe," said Stephen King, chief economist at HSBC in London. "German companies are able to tell workers that they can either accept reduced pay, or see the company close factories and reopen new ones in Poland or India."

The heightened mobility of capital allows companies to invest their profits around the globe with considerable freedom. "American companies really haven't been sinking much of their gains back into domestic investment," said Jared Bernstein, senior economist at the Economic Policy Institute in Washington. In the United States, nonresidential fixed investment as a percentage of G.D.P. fell to 11.56 percent in 2005 from 12.55 percent in 2000.

Thanks to globalization and the opening of new markets, Mr. King said, "it's increasingly difficult to argue that companies themselves are attached to a country." He notes, for example, that Vodafone, the giant British telecommunications company, has more than 80 percent of its sales and employment outside of Britain. And as of 2002, Mr. King found, the 50 largest multinational companies had 55 percent of their employees and 59 percent of their sales outside of their home countries.

The trend of corporate cosmopolitanism is most pronounced in Europe. In a report published last November, Mr. Artus of IXIS found that for the members of the German index, the DAX 30, about 53 percent of employment and 34 percent of sales were in Germany; for the companies in the CAC 40, the French index, 43 percent of employees and 35.5 percent of sales were in France.

The trend is less pronounced in the United States. Standard & Poor's estimates that the companies in the S.& P. 500 derive about 60 percent of their sales at home, according to Alec Young, equity market strategist at S.& P. But for some of the largest companies, like McDonald's, the domestic market counts for only one-third of revenue.

More important, Mr. Young said, a disproportionate share of the revenue growth is coming from overseas, which means that domestic companies may be less likely to hire and invest in the United States as sales and profits grow.

In Dell Computer's most recent quarter, foreign sales were 43 percent of total revenue, up from 40 percent in the previous quarter. Dell is hiring in the United States: last fall, it opened a plant in North Carolina that will employ 1,500 people within five years. In late March, Dell announced plans to hire 10,000 new employees over the next three years — in India.

Given these trends, the combination of rapidly rising corporate profits and stagnant or falling real wages seems less paradoxical. But some economists are wondering how much longer these trends can continue.

"When you have labor shares shrinking relative to capital shares, you tend to get a rise in economic nationalism, which is a democratic response to some of the effects of globalization," Mr. King said.

In other words, the arguments over Chinese imports, cross-border mergers and investments by companies from the Middle East in America's infrastructure could just be the beginning.

Some recommended weekend reading

Former Senator Ernest Hollings provides us with a history lesson on our country's trade policies, and explains why unfettered "free" trade deals pose a serious threat to America's economic security. Hat tip to Mitchell Freedman, who provides some more analysis on how Alexander Hamilton would have opposed "free" trade deals as well and links to a relevant section of the Federalist Papers.

Andrew Buncombe, writing in the Independent (UK), demonstrates just how hypocritical the Bush administration's complaints are regarding what it claims to be the mainstream media's biased coverage of the Iraq war. The coverage the US taxpayers have been subsidizing to PR (propaganda)-firm the Lincoln Group would be laughable if the impact on our credibility wasn't so serious. By comparing what we know about certain situations in the war theater to the way the Lincoln Group has been trying to "spin" it shines a harsh floodlight on the mendacity of our country's current political establishment. It's true what they say. truth is the first casualty of war.

Finally, Alternet discusses the real motivations behind the US's sustained rhetorical assault against Venezuela's Hugo Chavez. Quoting the Venezuela's ambassador to the US, the article notes: "For the first time, people are taking seriously that the major problems in the world are poverty and social exclusion -- not terrorism. These allegations are simply to avoid discussing these true problems; they are an attempt to undermine and divert from true economic development."

The US's current strategy is to try to isolate Venezuela rather than engage with it, and the mainstream media are all too happy to support this policy by providing unfair coverage. You wouldn't know from reading the New York Times or the Economist, for example, how effective Chavez's policies have been in fighting poverty, illiteracy and extending healthcare to 10 million people. You only hear about how he trashes Bush and is a left-wing populist. Meanwhile, Chavez enjoys a 70% approval rating, almost double what Bush currently has. And Venezuelans are enjoying an 18% income growth per capita.