Obama’s “Freeze” is Reactionary

My first reaction is the feeling that I am hallucinating and it's a bad trip:

President Barack Obama will propose a three-year freeze in discretionary, "non-security" spending as part of a budget he will unveil one week from now, a senior administration official told the Huffington Post and other reporters Monday evening.

The president will unveil the proposal during his State of the Union address on Wednesday….(link)

Say what? True, the economy has been spared another Great Depression—something that was accomplished by spending during a significant recessionary downturn—but it is hardly whole. Recessionary forces are still at work and there is a double-digit unemployment rate. If anything, what the economy needs is a second stimulus--a real one this time and not the largely token stimulus that Obama proposed and passed when he first entered office, one that doesn't merely spare us the worst but brings us to prosperity.

My second reaction is that when Obama had the chance to stride like FDR, he has retreated into becoming just another Herbert Hoover. It turns out I am not alone in that assessment:

Jonathan Zasloff writes that Obama seems to have decided to fire Tim Geithner and replace him with "the rotting corpse of Andrew Mellon" (Mellon was Herbert Hoover's Treasury Secretary, who according to Hoover told him to "liquidate the workers, liquidate the farmers, purge the rottenness".) (link)

My third reaction is that Obama must be panicked politically. He has taken the wrong lessons from the Massachusetts Senatorial special election. Instead of becoming truly populist, he has become reactionary. His budget freeze proposal isn't merely a move to the center--where he doesn't need to move in any case--but to the right. Besides, this move will not endear Obama to the reactionary right in the USA. Obama's liability is that he has a "D" after his name. The relatively tiny but vociferous reactionary right faction (and I include the tea partiers especially in this group) in the USA is a largely Republican phenomenon. That won't like anything Obama does because he is a Democrat. End of story.

My final reaction is one of concern. How exactly is the economy supposed to get jump started again? If the government doesn't do it, no one else will:

The bigger news is Obama is planning a three-year budget freeze on a big chunk of discretionary spending. Wall Street is delighted. But it means Main Street is in worse trouble than ever.

A pending [sic] freeze will make it even harder to get jobs back because government is the last spender around. Consumers have pulled back, investors won't do much until they know consumers are out there, and exports are miniscule. (link)

If the "last spender around" isn't spending, then the best the economy can hope for is stagnation. How is that going to help?

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State Senate Bill 81 Could Save Your Life

Thanks to federal government regulations I can go to a supermarket and examine how many calories, grams of saturated fat and carbohydrates, and milligrams of sodium a food product has before I purchase it. In other words, I can engage in comparison shopping because of government regulations. I can't engage in that kind of comparison shopping among restaurants in Delaware, especially among chain restaurants.

State Senate Bill 81 would address that problem. The principal sponsors of state SB 81 are state Senator David Sokola and state Representative John Kowalko. Their bill would require chain restaurants (defined as "retail food establishment…that does business under the same trade name as used by ten…or more other establishments doing business in Delaware or nationally….") to provide information to consumers about "[t]he total number of calories (rounded to the nearest ten calories), grams of saturated fat, grams of carbohydrates and milligrams of sodium, per menu item as offered for sale."

Because SB81 will allow consumers to engage in comparison shopping, it also should spur competition among restaurants to offer healthier foods. That makes SB 81 a win-win for consumers. It deserves our support.

It’s Time to Fight

If history attests to anything, it attests to the fact that when a people opt for progress and change (even a modicum of change as represented by the Presidency of Barack Obama), the forces of reaction will rise shortly thereafter with all their vehemence, energy, ugliness and political primitivism. Witness the tea party movement. Witness also the result of the Massachusetts US Senatorial campaign. It shows that when mobilized the forces of reaction will support choices that lack profundity and possess a surfeit of superficiality:

That is Scott Brown, the next Senator for the state of Massachusetts. A Republican. A Republican taking the seat once held by the now deceased Ted Kennedy. A Republican who ran on a reactionary platform of no universal health care for Americans, of no stimulus program that has a realistic chance of getting Americans back to work, of no to just about anything that smacks of economic progress for middle and lower class Americans.

How did this happen in a state with a 3 to 1 Democratic voter registration? Of course, it didn't help when Martha Coakley opportunistically and preemptively announced her candidacy within a few short days after Ted Kennedy's death. It left a bad taste in the mouths of the voters. Of course, it also didn't help that Ms. Coakley decided to take a vacation during the middle of the campaign, taking that Democratic voter registration for granted. Of course, it further didn't help that she ran a campaign that by the friendliest of accounts was characterized as "atrocious" and "awful."

It also doesn't help when high ranking Democrats don't know history: namely, that reactionary forces will dog and give no quarter to the forces of change and progress. None whatsoever. They cannot be negotiated with; they cannot be assuaged; they will not simply go away. They can only be fought politically and defeated. That's why, for example, it was mystifying when President Obama talked bipartisanship about health care legislation when the Republicans were explicitly saying that they wanted to turn the Democratic health care legislative initiative into President Obama's Waterloo. The position of the Republicans was trippingly clear: their reaction would not be bipartisan; it would be reactionary.

A year's worth of Democratic mollification has not worked. It's time to fight. Instead of retreating from an agenda of progress and change, it's time to press it. Actually, press it for the first time because so far that hasn't been done. That's what the voters want to see. They don't merely want change they can believe in. They want change and progress that they can see and experience. And that hasn't happened. That's why the Democrats lost in Massachusetts today. Scott Brown was a mere protest vote. The vote for him represents nothing that really fighting for a progressive agenda won't solve.

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God and Guns on a Holiday

"This is probably the best example of violation of the separation of church and state in this country.… It's literally pushing fundamentalist Christianity at the point of a gun against the people that we're fighting. We're emboldening an enemy."

Those trenchant words by Michael "Mikey" Weinstein ("of the Military Religious Freedom Foundation, an advocacy group that seeks to preserve the separation of church and state in the military") can only be an understatement given the enormity of this breach of the separation of church and state:

Coded references to New Testament Bible passages about Jesus Christ are inscribed on high-powered rifle sights provided to the United States military by a Michigan company, an ABC News investigation has found.

The sights are used by U.S. troops in Iraq and Afghanistan and in the training of Iraqi and Afghan soldiers. The maker of the sights, Trijicon, has a $660 million multi-year contract to provide up to 800,000 sights to the Marine Corps, and additional contracts to provide sights to the U.S. Army….

One of the citations on the gun sights, 2COR4:6, is an apparent reference to Second Corinthians 4:6 of the New Testament, which reads: "For God, who commanded the light to shine out of darkness, hath shined in our hearts, to give the light of the knowledge of the glory of God in the face of Jesus Christ."

Other references include citations from the books of Revelation, Matthew and John dealing with Jesus as "the light of the world." John 8:12, referred to on the gun sights as JN8:12, reads, "Whoever follows me will never walk in darkness, but will have the light of life."

A company spokesperson defended the practice by characterizing the opposition:

Trijicon confirmed to ABCNews.com that it adds the biblical codes to the sights sold to the U.S. military. Tom Munson, director of sales and marketing for Trijicon, which is based in Wixom, Michigan, said the inscriptions "have always been there" and said there was nothing wrong or illegal with adding them. Munson said the issue was being raised by a group that is "not Christian."

Apparently, no Christian would object to this practice. Moreover, apparently, no Christian would think it bizarre that references to the Bible would be printed on instruments that are used to kill people. The implication is that Christianity is of one type and that type sees no obligation to honor the separation of church and state much less waver at the prospect of killing people. Besides, what if non-Christians do object to this practice? Does that make their objection somehow invalid?

The US military's response?

Spokespeople for the U.S. Army and the Marine Corps both said their services were unaware of the biblical markings. They said officials were discussing what steps, if any, to take in the wake of the ABCNews.com report.

"What steps, if any"—surely they jest. If this egregious practice isn't wrong, what is?

Mike Castle and the “C” Word

It seems that the News Journal is trying its best to display Rep. Mike Castle as a moderate. Almost certainly this effort is a prelude to the News Journal endorsing Mike Castle campaign for the US Senate. Here is the News Journal's logic for characterizing Castle as a moderate:

Castle ranked among the top 10 House Republicans in his support for Obama, siding with the president nearly 56 percent of the time on votes where Obama took a clear position, a Congressional Quarterly vote study showed. On average, House Republicans supported Obama's position on 26 percent of votes last year.

During President George W. Bush's last year in office, Castle voted with his position less often -- 41 percent of the time.

Castle also ranked 17th among 177 House Republicans in the number of times he voted out of sync with most other members of his party. The study showed he voted against his party 24 percent of the time. In 2008, he ranked 6th, voting against the majority of his party nearly 30 percent of the time. (link)

Voting with President Obama 56% of the time, voted less often for former President Bush's position, out of sync with his fellow House Republicans who have only sided with President Obama 26% of the time. At first blush it sounds impressive. It creates the impression that Castle is a moderate and Delaware could safely send this Republican back to Washington as its next Senator. But notice this statement which gets short shrift in the News Journal article, one made earlier in the article before the discussion of Castle's voting record:

Democrats say Castle has voted against the interests of Delaware's residents on the most important pieces of legislation, including health care reform, job creation, stimulus money, and financial regulatory reform. They note that his party-line votes increased almost 11 percent, when comparing last year with his average voting record from 1993-2008. (link) (emphasis mine)

In other words, when it comes to the most important legislation—legislation that will help most Delawareans during the current ailing economy—Mike Castle can be relied upon by the GOP to toe the conservative line. He can be counted on to side with big finance and the health care industry, part of the GOP's historic moneyed constituency.

Except for one vote on global warming, Castle will side with President Obama when it matters least, not when it matters most. That makes Castle a moderate only on the margins but a hard core conservative at the center. That should be too conservative for Delaware.

Pretending It’s Not Happening: Cuba Helps Haiti

It's the unofficial policy of the USA not to acknowledge the humanitarian efforts of the Cuban government throughout various parts of the world. The US media largely complies with this policy. Unsurprisingly, Cuba's contribution to the humanitarian efforts in Haiti after the earthquake were largely ignored by the US media in its early reports:

There are only two US media outlets that have reported on Cuba's response to the deadly 7.0 earthquake that hit Haiti. One was Fox News, which claimed, wrongly, that the Cubans were absent from the list of neighboring Caribbean countries providing aid. The other was the Christian Science Monitor (a respected news organization that recently shut down its print edition), which reported correctly that Cuba had dispatched 30 doctors to the stricken nation….

As for the rest of the US media, they have simply ignored Cuba's role and actions. (link)

Not only did the 30 doctors Cuba sent to Haiti go largely unreported, but the doctors that Cuba already had working in Haiti scarcely warranted a mention:

In fact, left unmentioned is the reality that Cuba already had over 400 doctors posted to Haiti to help with the day-to-day health needs of this poorest nation in the Americas, and that those doctors were the first to respond to the disaster, setting up a hospital right next to the main hospital in Port-au-Prince which collapsed in the earthquake. (link) (emphasis original)

But this got plenty of media attention:

The United States struck a rare deal Friday with the Cuban government to send medical evacuation flights with victims of the Haiti earthquake through restricted Cuban airspace, a White House official told Fox News.

The flights, from the U.S. naval station at Guantanamo Bay to Miami, will be cut by 90 minutes in each direction by using the airspace. (link)

To the extent that Cuba facilitates the USA's humanitarian efforts, it's newsworthy. To the extent that Cuba exercises its own humanitarian efforts, it's not newsworthy. Fascinating.

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Credit Card Companies Skimming Charitable Donations

Do you think that every charitable dollar you send to help Haitians actually goes to their benefit? Think again if you use a credit card. Like the mafia skimming the profits from a casino, credit card companies skim as much as 3% of your donation for their profits.

You'd think that they would waive these fees on charitable organizations, especially during a time of disaster.

clipped from www.huffingtonpost.com As a massive human tragedy unfolds in Haiti, relief organizations are soliciting credit-card donations through their hotlines and websites. About 97 percent of these donations will actually make it to the designated organizations -- but the other 3 percent will be skimmed off by banks and credit card companies to cover their "transaction costs." Thanks to this hidden fee, American banks and credit card companies are making huge profits -- somewhere in the neighborhood of $250 million a year -- off of people's charitable donations, according to a Huffington Post analysis. Those profits rise sharply after major disasters, when humanitarian relief organizations such as Oxfam and Operation USA take in more than 85 percent of their donations via credit card -- and the credit card providers, with only a few exceptions, refuse to waive their fees.

Pat Robertson Blames the Victims in Haiti

Televangelist and GOP stalwart Pat Robertson blamed the victims in Haiti for the devastating earthquake, which, according to some estimates, have left one hundred thousand dead:

Televangelist Pat Robertson said Wednesday that earthquake-ravaged Haiti has been "cursed" by a "pact to the devil."

"Something happened a long time ago in Haiti, and people might not want to talk about it," he said on Christian Broadcasting Network's "The 700 Club." "They were under the heel of the French. You know, Napoleon III, or whatever. And they got together and swore a pact to the devil. They said, we will serve you if you'll get us free from the French. True story. And so, the devil said, okay it's a deal."
Robertson said that "ever since, they have been cursed by one thing after the other" and he contrasted Haiti with its neighbor, the Dominican Republic.

"That island of Hispaniola is one island. It is cut down the middle; on the one side is Haiti on the other is the Dominican Republic," he said. "Dominican Republic is prosperous, healthy, full of resorts, etc. Haiti is in desperate poverty. Same island. (link)

Robertson is notorious for exploiting disasters for theological purposes.  Follow this link to see what he said about the 9/11 and Katrina hurricane tragedies.

Federal Reserve Makes Record Profits in 2009

B-b-but, conservatives, I thought that the Federal Reserve's intervention into the economy was supposed to fail:

Wall Street firms aren't the only banks that had a banner year. The Federal Reserve made record profits in 2009, as its unconventional efforts to prop up the economy created a windfall for the government.

The Fed will return about $45 billion to the U.S. Treasury for 2009, according to calculations by The Washington Post based on public documents. That reflects the highest earnings in the 96-year history of the central bank. The Fed, unlike most government agencies, funds itself from its own operations and returns its profits to the Treasury.

The numbers are good news for the federal budget and a sign that the Fed has been successful, at least so far, in protecting taxpayers as it intervenes in the economy….(link)

What heresy! Yet it is an apparent fact. After intervening in the US economy by making loans to lending institutions, "[t]he Fed will return about $45 billion to the US Treasury." Intervention = return to the US Treasury. Egad! How can this be, conservatives?

While "[m]uch of the higher earnings came about because of the Fed's aggressive program of buying bonds, aiming to push interest rates down across the economy and thus stimulate growth," "[t]he Fed also made money on its emergency loans to banks and other firms and on special programs to prop up lending, such as one that supports credit cards, auto loans, and other consumer and business lending." Well there it is in black and white. I guess those conservatives were wrong…again.

Military Service Suicide Rates on the Rise

We don't count them among the casualties of our wars, but perhaps we should. I'm talking about those who, we think, return from war safely, only to kill themselves later. What horrors they must have witnessed. And often we ask them to experience these horrors in conflicts that have no clear national security necessity. For some, skewed by depression and pain, that must make their service seem meaningless.

We need to do more to help them, to identify the ones that are hurting, and to provide them the care they need. A responsible nation cannot simply wink at the problems it creates.

clipped from www.nydailynews.com In and out of uniform, those who have served the nation in the military are killing themselves at rates never seen before. In November, Gen. Peter Chiarelli, the Army’s vice chief of staff, said the 211 suicides in the Army in 2009 had already surpassed the record rate of 2008. Chiarelli called the problem the toughest he had faced in his 37 years of distinguished service. Today, Veterans Affairs Secretary Eric Shinseki, the former Army chief of staff, said the suicide rate for men aged 18-29 who have been discharged had gone up by 26% from 2005-07. At a suicide prevention conference, Shinseki said: “As I’ve often asked, mostly of myself, but also of others from time to time, why do we know so much about suicides but so little about how to prevent them?” “Of the more than 30,000 suicides in this country each year, fully 20% of them are acts by veterans,” Shinseki said. That means on average 18 veterans commit suicide each day. Five of those veterans are under our care at VA.

Rudy Giuliani: "We had no domestic attacks under Bush"

Given that Dana Perino and Mary Matalin made similiar statements, writing off Giuliani's omission of 9/11 as a memory lapse could be a mistake. It could very well be that some in the GOP are trying to rewrite history for the purpose of making the public think that a domestic attack by terrorists on US soil only occurred under Obama.

Don't mention 9/11. Maybe the public will forget. What audacious historical revisionism.

clipped from www.huffingtonpost.com Rudy Giuliani has joined fellow Republicans Dana Perino and Mary Matalin in seeming to forget that the September 11th attacks happened under President Bush. On "Good Morning America" Friday, the former New York mayor declared, "We had no domestic attacks under Bush; we've had one under Obama." Not only does the statement suggest Giuliani does not remember the devastating attack in his own city, it also omits the anthrax attacks and the attempted shoe bomber attack. A day earlier, Giuliani falsely claimed that the shoe bomber attack occurred before September 11th. Curiously, the Associated Press did a long write-up of Giuliani's Obama criticisms but omitted the startling mistake. George Stephanopoulos, who conducted the ABC interview, included the quote in a blog post but did not question it.

Public Announcement: Free Screening of “The Times of Harvey Milk”

On Tuesday, January 12, 2010, at 7:00 PM there will be a free screening of "The Times of Harvey Milk" at Theatre N. Theatre N is located in the Nemours building at 11^th and Tatnall Streets in Wilmington, DE. More information can be found here.

The free film is presented by the Laborers International Union of North America, (LiUNA) and Laborers Political League of Delaware.

Possible War Crimes in Sri Lanka

Below is some footage of possible war crimes committed by the army forces of the Sri Lanka government. The images are disturbing.



The government of Sri Lanka disputes the authenticity of the footage, although some experts attest to its authenticity. More about the story and dispute can be found here.

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Quitting for the Best of Reasons

I have known Dover, Delaware, City Councilperson Timothy Slavin for several years. He is a highly intelligent, capable and compassionate person with considerable personal integrity. He has decided not to run for reelection to Dover City Council:

Timothy A. Slavin has announced that he won't run for re-election to City Council, saying he had been able to accomplish much of his agenda during three two-year terms in the District 3 seat.

"I never saw it as an entitlement," Slavin, who lives on Hazel Road, said. "I think it's time for me to spend more time with my family and make way for a new face."

Slavin, 47, director of the state Division of Historical and Cultural Affairs, has served on council since May 2004. He currently is chairman of council's Safety Advisory and Transportation Committee. (link)

"I never saw [holding the office] as an entitlement." That sounds exactly like the Timothy Slavin I know and respect.

Public Announcement: Important Delaware Family Law Commission Meeting

The Family Law Commission has announced their 2010 annual public hearing. The hearing will be held January 12^th in House Chambers at Legislative Hall, Dover. The hearing will begin at 7:00pm.

I have attached the description of the public hearing found on the Commission's website.* It includes a "preferred" format to follow when giving testimony.

The Commission wants to hear from you. You can help improve the Family Court system. Don't just make a complaint; offer a solution. You are not the only person who has experienced horrors of the Family Court system; let's stand up and speak up for change. If you have positive suggestions on how Family Court can better serve those who "must" enter the system, this is your opportunity. The Family Law Commission will meet 5 more times this year to discuss those issues and concerns brought before them during this hearing.

Let Your Voice Be Heard. Write and submit your comments. You will be given 5 minutes to give your testimony. If, however, you cannot attend the hearing in person, the Commission takes written testimony before and after the hearing. You can submit written testimony to Drew Slater, Legislative Assistant, at Drew.Slater@state.de.us .

Every year, Delaware Court Reform Initiative asks those who attend the hearing to fill out an anonymous survey. This survey assists advocates in their efforts to reform Family Court. But...

WITHOUT "YOU" NOTHING WILL CHANGE !!

Never give up, your voice does make a difference.

Raetta McCall
Delaware Court Reform Initiative

# # # #

*Annual Public Hearing
January 12, 2009
7pm Legislative Hall

The Family Law Commission is again holding an annual Public Hearing to enhance our understanding of the concerns from the public regarding Family Court. In past years, the public comments would be focused on each person's individual trials and history with Family Court. While this is immensely helpful to the Family Law Commission it can tend to take more than the allotted five minutes for each speaker.

In order for the Family Law Commission to better understand the public input, we would like each speaker to state the problem they have with Family Court as succinctly as possible and tell us how the Family Law Commission can help. There are forms available to help each speaker: 1) describe the issue 2) recommend how the issue can be resolved and 3) explain why the issue is important.

We request that each speaker fill out this form and leave it with the undersigned after the meeting. The Commission can then review the public recommendations to improving the system.

Thank you for your help! Any questions, please feel free to contact me at 302-744-4039 or Drew.Slater@state.de.us.

Sincerely,
Drew Slater
Legislative Assistant

Why I Don't Fear the 2010 Elections for Democrats

All the hand wringing about the prospects of the Democratic Party losing control of Congress in the 2010 elections fails to take into account how the Republicans are sabotaging their own prospects in 2010.  The GOP is defining itself as the party of the birthers, the tea partiers, the red baiters, and in other sundry reactionary ways.  As Democratic Senatorial Campaign Committee Chairman Robert Menendez (D-N.J.) says:

"Whether it is the tea party people or the birthers or others, the reality is that the extreme right wing of the Republican Party, they keep pushing their candidates further and further to the right... So, the bottom line is, they are going to be out of sync of where the mainstream electorate is in the midterm election." (link)

While no doubt many in the GOP dislike the their party's drift to the extreme right-wing, what can they do about it?  Disenfranchise their reactionary base?  That's not likely to happen.  I'd say that on balance the Democrats are in a better position in 2010 than the Republicans.

Making Delaware’s FOIA Compliance Timely

I have long thought that a Delawarean's right to freedom of information should be a constitutional right and not merely a statutory one. That way in many cases there could be no legal question about a citizen's right to information and government agencies would have to staff their agencies to comply with a citizen's constitutional right. Nevertheless, after a long period of citizen advocacy, Delaware has recently made vast improvements to its Freedom of Information Act (FOIA) law. FOIA now extends to the Delaware legislature.

One of the lagging areas in Delaware's FOIA law has been in the timeliness with which government agencies must comply with FOIA requests. But Rep. E. Bradford Bennett has proposed legislation to address the timeliness issue, legislation that deserves citizen support:

A custodian of a record for the appropriate public body who receives a request for a public record shall grant access to such public record or deny access to such public record as soon as possible, but not later than ten business days after receiving the request for a public record.

Requests are to be complied with "as soon as possible, but not later than ten business days after receiving the request for a public record." That sounds fair.

Of course, some requests can be voluminous and some requests might infringe on other rights and laws and require an expert legal opinion before they can be acted upon (e.g. requests that might compromise confidential personnel information). Rep. Bennett's proposed legislation addresses these eventualities as well:

Additional time shall be allowed beyond the ten business days provided for in subsection when a request is for voluminous records, requires legal advice or a public record is in storage or archived. In any of these cases, the requestor shall be advised by the custodian of a record, within 10 business days after the custodian of a record receives the request, stating the need for additional time. Such additional time provided for in this subsection shall be reasonable.

Rep. Bennett's proposed legislation hits the right balance.

Tea Partier Sign

Don't tell me that many of the tea partiers aren't filled with hate.

FOX's Brit Hume Pushes Christianity on Air

One expects this kind of behavior from a newsperson in a nation with a strong theocratic orientation. So much for being "fair and balanced."

clipped from www.huffingtonpost.com On Monday night on the "O'Reilly Factor", Brit Hume had the chance to reiterate the personal advice he offered to Tiger Woods last Sunday morning: for a full recovery, the scandal plagued (and Buddhist) golfer should "turn to Christianity." O'Reilly played a clip of Hume's comments, then asked him: "Was that proselytizing?" "I don't think so," Hume said, and added that the content of Woods' character was "not what we thought it was." Hume went on to reassert his belief that "Jesus Christ" offers something that Woods "badly needs." "He needs something that Christianity especially provides and gives and offers, and that is redemption and forgiveness. I was really meaning to say in those comments yesterday more about Christianity than anything else...I think that Jesus Christ offers Tiger Woods something that Tiger Woods badly needs."

“Harsh Lessons We May Need to Learn Again”

Nobel Prize winning economist Joseph E. Stiglitz sums up the economic lessons of the waning years of the last decade (I will only cover the first three). Unfortunately, given the grip that high finance has over Washington DC, Stiglitz must call them "Harsh lessons we may need to learn again." Nevertheless, these lessons are transparent to anyone interested in the truth and not under the sway of free market fantasies. We must insist that our elected representatives in Washington DC effectively recognize these truths legislatively.

Lesson One: Unfettered Capitalism Doesn't Work

Stiglitz writes:

The first lesson is that markets are not self-correcting. Indeed, without adequate regulation, they are prone to excess. In 2009, we again saw why Adam Smith's invisible hand often appeared invisible: it is not there. The bankers' pursuit of self-interest (greed) did not lead to the well-being of society; it did not even serve their shareholders and bondholders well. It certainly did not serve homeowners who are losing their homes, workers who have lost their jobs, retirees who have seen their retirement funds vanish, or taxpayers who paid hundreds of billions of dollars to bail out the banks.

The excesses of largely unregulated capitalism led to an historical irony:

Under the threat of a collapse of the entire system, the safety net - intended to help unfortunate individuals meet the exigencies of life - was generously extended to commercial banks, then to investment banks, insurance firms, auto companies, even car-loan companies. Never has so much money been transferred from so many to so few.

Because the taxpayers' money came with few strings attached (again, a lack of adequate regulation) banks have largely reneged on assisting a full economic recovery:

The justification was that bailing out the banks, however messily, would enable a resumption of lending. That has not happened. All that happened was that average taxpayers gave money to the very institutions that had been gouging them for years - through predatory lending, usurious credit-card interest rates, and non-transparent fees.

In short, unfettered capitalism does not work. It cannot be trusted to work, even unwittingly, for the benefit of all.

Lesson Two: The Reasons Why Markets Fail

The reasons why markets fail can be many and complex and their recent failures are not any less so even though some reasons can be identified:

The second important lesson involves understanding why markets often do not work the way they are meant to. There are many reasons for market failures. In this case, too-big-to-fail financial institutions had perverse incentives: if they gambled and succeeded, they walked off with the profits; if they lost, the taxpayer would pay. Moreover, when information is imperfect, markets often do not work well - and information imperfections are central in finance. Externalities are pervasive: the failure of one bank imposed costs on others, and failures in the financial system imposed costs on taxpayers and workers all over the world.

Lesson Three: Keynesian Policies Work

This reason will make the free market fetishists grind their teeth. But the truth comes with contemporary examples:

The third lesson is that Keynesian policies do work. Countries, like Australia, that implemented large, well-designed stimulus programs early emerged from the crisis faster. Other countries succumbed to the old orthodoxy pushed by the financial wizards who got us into this mess in the first place.

Whenever an economy goes into recession, deficits appear, as tax revenues fall faster than expenditures. The old orthodoxy held that one had to cut the deficit - raise taxes or cut expenditures - to "restore confidence." But those policies almost always reduced aggregate demand, pushed the economy into a deeper slump, and further undermined confidence - most recently when the International Monetary Fund insisted on them in East Asia in the 1990's.

Readers are encouraged to read the fourth and fifth lessons here.

Stiglitz ends with this stern warning:

We will soon find out whether we have learned the lessons of this crisis any better than we should have learned the same lessons from previous crises.

Regrettably, unless the United States and other advanced industrial countries make much greater progress on financial-sector reforms in 2010 we may find ourselves faced with another opportunity to learn them.

Short of a second and truly substantial stimulus, I fear that we will not learn these lessons and that the economy will fall into a slump again by the third quarter of 2010. I hope that I am wrong because the economic and electoral consequences for 2010 could be effectively catastrophic for years to come. I am not the only one who thinks so.

The Three is Enough Campaign: Hypocrisy in Capitalism at Work

I don't like the prospect of new casinos coming to Delaware. So much about it stinks. It would be a parasitical and irresponsible to allow new gambling venues to feed on the low wages of desperate Delaware workers, especially during economic hard times. And it is a testament to the lack of vision and imagination of the Delaware state government to boost its revenue through expanding gambling.

Nevertheless, it is instructive that Delaware's extant three gambling casinos oppose a possible expansion as well. It teaches us about how capitalistic enterprises operate in the real world (as opposed to the fantastical "free market" scenarios dreamt in capitalistic theory):

Dover Downs, Delaware Park, and Harrington Raceway have launched a public relations campaign -- including a Web site and a self-commissioned study -- condemning the idea of added [gambling] venues and encouraging employees to pressure lawmakers.

The initiative comes ahead of the Jan. 12 start of the legislative session and provides a look into the looming battle over changes to the gaming landscape, which will likely pit longstanding lobbying powers against leadership in Dover. (link)

Once in operation, business enterprises often seek virtual monopolistic domination of the market through the auspices of government. What businesses often want is not a free market but a closed market. Why compete if you can get the government to crush your potential competitors?

And don't expect the so-called advocates of free markets to act any differently. After all, their clients—their bread and butter—are the monopolists:

The Three is Enough campaign also boasts other supporters, including the Kent County Convention and Visitors Bureau, Delmarva Cleaning and Maintenance, the AmericInn Harrington and the Central Delaware Chamber of Commerce. (link)

Did you notice that? The Central Delaware Chamber of Commerce. That is only surprising to those who understand capitalism platitudinously and not the way it operates in reality.

I’m Back

It simply came down to this: I missed blogging too much.

During the past 3 months, things were happening locally and elsewhere that I felt a strong urge to comment about and I said nothing. For example, I sat out the health care debate in Congress when it reached its critical stage. The things I wanted to say then, but I thought I should give quitting more of a chance.

I was busy though with teaching and I will be in the months ahead as well. But I did develop a work pace that left me with more time than I imagined I'd possess. So I'll be able to do both: do justice to my job and blog.

I'm back.