Monday, February 29, 2016

RT — ‘We will participate’: Saudi military admits US coalition mulling ground invasion in Syria

Saudi Arabia has acknowledged that the US-led anti-ISIS coalition has held a “political” discussion about a potential ground troop deployment in Syria. Riyadh’s statements have been criticized by Damascus as destructive and a threat to regional security.
In an interview with Reuters, an aide to Saudi Arabia's defense minister, Brigadier General Ahmed Asseri, confirmed that defense ministers from the anti-Islamic State (IS, formerly ISIS/ISIL) coalition debated placing ground troops on the ground in Syria during a ministerial meeting in Brussels last month.
“It was discussed two weeks ago in Brussels,” Asseri said, clarifying that the discussions took place on the “political” level only without going into details of a potential “military mission.”
‘We will participate’: Saudi military admits US coalition mulling ground invasion in Syria

Bill Mitchell — We are being led by imbeciles

After yesterday’s marathon blog, today will be easier going (and shorter). I was reading John Maynard Keynes recently – circa 1928 – that is, 8 years before the publication of the General Theory with his Treatise on Money intervening. He was railing against the principles and practice of ‘sound finance’, which he noted had deliberately caused billions of pounds in lost income for the British economy. He urged the Treasury and the Bank of England to abandon their conservative (austerity) approach to the economy and, instead, embark on wide-scale fiscal stimulus to create jobs and prosperity. He concluded that with thousands of workers idling away in mass unemployment that it was “utterly imbecile to say that we cannot afford” to stimulate employment via large-scale public works – building infrastructure etc. He considered the policy makers who opposed such options were caught up in “the delirium of mental confusion”. The stark reality is that 88 years later, he could have written exactly the same article and would have been ‘right on the money’. We are being led (euphemism) by imbeciles.…
We call them "morons" aka "morans" here.

Occasionally history does repeat.

Bill Mitchell – billy blog
We are being led by imbeciles
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Alex Leshy —ISIS Middle-Eastern Gambit

It is now clear that ISIS leaders have begun to transfer its fighting formations to Libya and are reorienting their recruitment apparatus to attract cannon fodder for the units being formed in Libya.…
It’s doubtful this move was planned in advance. Instead, it is most likely a forced reaction to the negative strategic prospects in Iraq and Syria. There are more and more indications that ISIS has decided to transform its defeat in Syria into a strategic gambit in the continuing global struggle.…
Overall, Libya represents an almost ideal situation for ISIS. Local forces can do nothing against the “black flags.” West is also powerless. And the fearsome and implacable Russians are kept at bay by the absence of invitation from Libya’s government or of a UNSC resolution authorizing intervention which nobody will grant Moscow for many quite obvious reasons.
All of that is quite depressing, since it allows Islamist radicals a large and well protected base which they could use to recuperate and continue their expansion even after losing Syria and Iraq.…
This is the overall. The details are also interesting.

ISIS Middle-Eastern Gambit
Original by Alex Leshy
Translation by J.Hawk

Bruce Bartlett and James Galbraith — The Battle Over Reagan’s Economic Plan

The spirited debate about the merits of Bernie Sanders's economic plan reminds two prominent economists of one that they were on opposite sides of 35 years ago.…

JKG: "The lesson for today is that we shouldn’t be imprisoned by the conventional wisdom of establishment economists. When the magnitude of our economic problems is great, as it was with inflation in the early 1980s and stagnant growth now, bold policies must be enacted."
Moyers & Co.
The Battle Over Reagan’s Economic Plan
Bruce Bartlett and James Galbraith
In 1981, Galbraith was executive director of the Joint Economic Committee and head of its Democratic staff. Bartlett was deputy director of the Joint Economic Committee and head of its Republican staff.

John Robb — Trump's Insurgency (a must read)

Nails it. 

Couple this with Scott Adams's analyses of Trump as Master Persuader. 

Global Guerrillas
Trump's Insurgency (a must read)
John Robb

lkb22 — Chinese military base in North Africa as Thucydides Trap

The real issue for the US is China, and doubly so now that Russia has turned East after being rejected by the West. That rejection may turn out to be the most costly mistake and the biggest strategic move in history.

Whatever, an arms race is in full swing.


David Ellerman — Neoclassical Economics as the New Social Engineering

This is a preprint of a paper on the role of neoclassical economics in the disastrous “Big Bang” or “shock therapy” advice given by Western academics and Western advisory agencies (World Bank, IMF, USAID,…) to the post-socialist countries. The paper is published as: Ellerman, David. 2016. “Neoclassical Economics as the New Social Engineering: The Debacle of the Russian Post-Socialist Transition.” In The Oxford Handbook of Professional Economic Ethics, edited by George F. DeMartino and Deirdre N. McCloskey, 520–33. New York: Oxford Univeristy Press.
Click here to download the preprint.
How"the Harvard boyz" and international institutions almost destroyed the countries of the former USSR with their "expert advice."  

Russia was on the ropes being pummeled by mafiosi until Marshall Putin rode into town and established new rules. The West has never forgiven him for shutting down the table.

Neoclassical Economics as the New Social Engineering
David Ellerman

Keep buying the dips. Spending really accelerating now.

Federal Government spending is really accelerating now. We are $45 billion over last year and last year was the biggest increase in six years. There will NOT be a recession. You can look at the deficit all you want; you're wasting your time. The Fed will raise rates at least two more time this year.

The stock market is giving everyone easy opportunities to get in. There's been plenty of good, back and forth action. That won't always be the case. We'll go parabolic at some point.

Forex is also presenting great opportunities. If you don't trade forex, get my course.

Brad DeLong — Pragmatism or Perdition

Brad DeLong hawks his new book with Stephen S. Cohen. Looks generally good, but unfortunately it is not in paradigm.

While still stuck in the neoclassical "standard" model, Brad has a much broader and deeper grasp of his subject than most others and rises to the requirements Keynes set forth for a good economist. If he altered his views toward PKE and MMT, he could be a great one.
The study of economics does not seem to require any specialized gifts of an unusually high order. Is it not, intellectually regarded, a very easy subject compared with the higher branches of philosophy or pure science? An easy subject at which few excel! The paradox finds its explanation, perhaps, in that the master-economist must possess a rare combination of gifts. He must be mathematician, historian, statesman, philosopher—in some degree. He must understand symbols and speak in words. He must contemplate the particular in terms of the general and touch abstract and concrete in the same flight of thought. He must study the present in the light of the past for the purposes of the future. No part of man’s nature or his institutions must lie entirely outside his regard. He must be purposeful and disinterested in a simultaneous mood; as aloof and incorruptible as an artist, yet sometimes as near to earth as a politician.
— J. M. Keynes "Alfred Marshall, 1842-1924" The Economic Journal, (Sept.,1924), 321-322
Project Syndicate
Pragmatism or Perdition
J. Bradford DeLong | Professor of Economics at the University of California at Berkeley, a research associate at the National Bureau of Economic Research, and Deputy Assistant US Treasury Secretary in the Clinton Administration

Zaid Jilani — Neoconservatives Declare War on Donald Trump

With Trump’s ascendancy, it’s possible that the parties will re-orient their views on war and peace, with Trump moving the GOP to a more dovish direction and Clinton moving the Democrats towards greater support for war.
Good article. The battle lines are being drawn, people are switching sides of the aisle, and green ammunition is pouring in.

The Intercept
Neoconservatives Declare War on Donald Trump
Zaid Jilani

Gerald Friedman responds to Christina and David Romer

The Romers, and I suppose other neoclassical macro economists, believe that the economy tends towards full employment equilibrium and will move there on its own without need for government intervention or stimulus. They would acknowledge that following a negative shock, government stimulus spending may accelerate the recovery somewhat, as Bernstein and Romer in 2009 anticipated the Obama stimulus would speed recovery by about 6 months. They deny, however, that stimulus spending could change the permanent level of output because the economy will on its own return to full employment at a capacity output set without regard to the level of employment by factor endowments, by preferences, and by the level of exogenous technology. From this perspective, because a period of prolonged measured slow growth cannot be caused by involuntary unemployment, it must, by a priori assumption, be due to a decline in the exogenously determined growth rate in capacity. Like mosquitos on an otherwise delightful summer afternoon, slow growth is unfortunate but there is little that can safely be done about it.

Or maybe we can find safe pesticides. Here I agree with John Maynard Keynes that the economy can have a low-employment equilibrium because of a lack of effective demand, and I agree with Nicholas Kaldor and Petrus Verdoorn that productivity and the growth rate of capacity can be increased by policies that push the economy to a higher level of employment. And to the contrary, periods of prolonged unemployment and underutilization of capacity can lower capacity by discouraging workers and reducing the incentive to invest, to innovate, and to raise productivity. Unfortunately, this is what has been happening in the US for the last few years; and, fortunately, there is reason to believe following Keynes/Kaldor/Verdoorn that policy can reverse this decline by pushing the economy to a higher level of output and thus a higher level of productivity….
Gerald Friedman responds to Christina and David Romer

David F. Ruccio — Looking below the surface

What liberal mainstream economists don’t see—and don’t want the rest of us to wrap our heads and hearts around—is that growth, by itself, has only a small effect on incomes for poor and working Americans. It doesn’t raise wages, it doesn’t reduce poverty, and it doesn’t close the gap between productivity and wages. Not in any significant fashion. And it will probably make the distribution of income even more unequal than it is now. 
That’s why increasing numbers of people have become disenchanted with the “liberal fantasy” and have begun to look elsewhere—below the surface—to ask new questions about how the economy is currently organized and how it might be reorganized to actually benefit poor and working people.
The growth is good (for all) assumption is based on trickle down, and that has been shown not to work as advertised, or even much at all.

"It's the distribution, stupid."

In a system in which labor power is suppressed, for example, "to control inflation", labor share will be controlled by the ownership class that the management class serves, or are members of.

Occasional Links & Commentary
Looking below the surface
David F. Ruccio | Professor of Economics, University of Notre Dame

Anthony Dimaggio — Sanders’ Socialism: Neutering a Radical Tradition

The discussion of the Sanders campaign in “mainstream” media discourse is heavily propagandistic, completely failing to provide audiences with an accurate understanding of the difference between socialism and social democracy, the latter of which Sanders actually embraces, despite his rhetorical support for the former….
Bernie Sanders is neither a radical nor a revolutionary; therefore, he is no socialist.  He just want a welfare state under managed capitalism instead of a market state under neoliberalism.

Sanders’ Socialism: Neutering a Radical Tradition
Anthony Dimaggio

Eberhard Hamer — The US are using Volkswagen (VW) to test their TTIP power

What the United States and their global corporations call “Free Trade Agreement” (TTIP) has been compared to NATO by former US-vice president Biden. It is meant to subject Europe to American economic domination and their interests. This has an inner and an outer goal….
Voltaire Network
The US are using Volkswagen (VW) to test their TTIP power
Eberhard Hamer

Gilbert Doctorow — ‘Foreign Affairs’ magazine: security analyses tailored to politically expedient solutions

For purposes of this essay, I take Foreign Affairs magazine as a marker for the broad spectrum of U.S. expert publications in international affairs. That is justified because the magazine has the greatest circulation in its class. The sins of the magazine’s editor Gideon Rose, which I set out below, are not his alone, to be sure.
Where Russia is concerned, and now also where China is concerned, one can count on Foreign Affairs magazine to feature articles presenting the bogeymen in the form the United States security and international affairs establishment feels most comfortable with, irrespective of whether this particular bogeyman has any basis in real life facts. They are comfortable, because the given analyses support policy recommendations, and in particular, defense appropriations, which the establishment wants to see approved by the White House, by the Congress.
I do not mean to suggest that all articles fit this generalization, because occasionally dissenting views are allowed some space, especially if they are badly argued. But the great majority does fit it, and the American public is the big loser by this disservice because the expert community, not to mention your average citizen, is deprived of any objective, hands-on examination of these very important and powerful countries which can, and perhaps already do pose existential threats to the USA, but for reasons of reaction to American policy rather than any latent aggression.
It is the resulting cluelessness of our media and of the experts who are given air time and print pages that time and again catches us by surprises dealt by the supposedly volatile Russians and enigmatic Chinese. If the initial U.S. action were mentioned, still better analyzed, the reaction could be modified or forestalled. Instead, the reaction is taken as a starting point and a policy recommendation to neutralize it is put forward that opens a new action-reaction cycle rather than closes the existing one. In this way we are escalating tensions to the breaking point, which in our still nuclear age is not very smart and looks more like a death wish.…
Wishful thinking, group think, and propaganda substituted for analysis.

Une parole franche
‘Foreign Affairs’ magazine: security analyses tailored to politically expedient solutions
Gilbert Doctorow

Alexander Mercouris — Syrian Peace Plan: US Seethes at Its Humiliation by Russia

A very well sourced article, which has recently appeared in The Wall Street Journal (attached below), shows the extent of the policy disarray in Washington following the US-Russian “cessation of hostilities” agreement.
It seems there has been a massive row.

The heads of the US military and the CIA are clearly furious at the way in which they feel the US has been humiliated, and in a series of angry meetings in the White House they have made their feelings known.
Though they rationalise their anger with talk about how Russia cannot be trusted, and how US allies in the regions like the Turks and the Saudis feel betrayed, that is what it amounts to.….
… the anger the hardliners feel does not promise well, and is absolutely not a cause for rejoicing, and certainly not for gloating. On the contrary, it is a cause for foreboding and for worry about the future.
Far from accepting their defeat, on past experience the hardliners will now be looking for ways to get even with Russia.

The fact they cannot do it in Syria will not hold them back, any more than failure in Vietnam in the 1970s held an earlier generation of US hardliners back.
What happened then was that the hardliners “avenged” the US's defeat in Vietnam by setting Afghanistan on fire - with catastrophic consequences for the whole world including the US.

The fact Afghanistan turned out a disaster will however hardly deter the hardliners of today from acting in the same way. If there is one constant in US foreign policy it is that when it comes to disasters it is the wrong lessons that always get learnt.

Far from being a factor in improving relations between the US and Russia, the fact the US feels humiliated in Syria is going to make relations between the two countries even worse than they already are, and is storing up more problems for the future.
From the WSJ article:
President Barack Obama’s top military and intelligence advisers, convinced Russia won’t abide by a cease-fire in Syria, are pushing for ways to increase pressure on Moscow, including expanding covert military assistance for some rebels now taking a pounding from Russian airstrikes.
Defense Secretary Ash Carter; Marine Gen. Joseph Dunford, the chairman of the Joint Chiefs of Staff; and Central Intelligence Agency Director John Brennan have voiced increasingly tough views in White House meetings, calling for new measures to “inflict real pain on the Russians,” a senior administration official said. Russia Insider
Russia Insider
Syrian Peace Plan: US Seethes at Its Humiliation by Russia
Alexander Mercouris

Christopher Black issues a warning below. Very dangerous situation and ugly outlook. "Operation Barbarosa" was the Nazi codeword for the invaston of Russia.

Operation Barbarossa 2: The Baltic Gambit
Christopher Black

Russia Insider
US Army Ships 5,000 Tons of Ammunition to Germany
Originally Appeared at German Economic News.
Translated by Werner Schrimpf

This is taking place within the context of the Wolfowitz doctrine that holds the US will not permit a military or economic challenge to US global hegemony. Add to that the fury of the US deep state of being not only frustrated by Russia but humiliated. Add to that nuclear weapons, and go figure. And add to that the fact that the people involved are (alleged) war criminals that have already established in evidence that the prohibition against illegal aggression and torture mean nothing to them.

This also explains in part why Rep. Tulsi Gabbard felt it incumbent to burn her bridges with the Establishment and endorse Bernie Sanders.

James Galbraith — The Friedman v. Romers Growth Debate on the Sanders Plan – A Summing Up

Here is a brief summary of the state-of-debate over the Sanders economic program and the growth projections made by Professor Gerald Friedman.

Major points

1) The growth projections have no bearing on the desirability of Sanders’ program, which consists of major structural reforms in health care, education, and public investment, in public governance and in the distribution of the tax burden.
2) The original mudslinging by four past Chairs of the Council of Economic Advisers was based on nothing, except that Friedman’s growth numbers looked high. No analysis preceded that claim.…
Naked Capitalism
James Galbraith: The Friedman v. Romers Growth Debate on the Sanders Plan – A Summing Up
James K. Galbraith, Professor of Government/Business Relations at the Lyndon B. Johnson School of Public Affairs, the University of Texas at Austin. His most recent books are Inequality and Instability and The End of Normal

Branko Milanovic — Free trade and war: a review of Avner Offer’s “The First World War I: An Agrarian Interpretation”

History may not repeat, but there are eerie parallels. A similar scenario is now in progress. Stay tuned.

Global Inequality
Free trade and war: a review of Avner Offer’s “The First World War I: An Agrarian Interpretation”
Branko Milanovic | Visiting Presidential Professor at City University of New York Graduate Center and senior scholar at the Luxembourg Income Study (LIS), and formerly lead economist in the World Bank's research department and senior associate at Carnegie Endowment for International Peace

John Helmer — Fire Eye Or Blood Shot – Financial Times Weaponizes Reporting To Save Financial Collapse Of Business

Propaganda for sale.
A fact which nobody can verify is usually a fiction, sometimes a lie. In the business of reporting news for sale, the demand for lies is less than the supply, so profit is bound to turn into loss. The only successful business models for reporting and repeating lies are government propaganda and commercial pornography.
When Jones reports FireEye’s detection of Russian threats in the Financial Times, he is advertising FireEye’s services. When the FireEye analysts and Jones can’t substantiate the threat claims, they are advertising something else. Jones was asked: “In relation to FireEye, will you say whether you have received any form of entertainment, hospitality, trip, accommodation or benefit from FireEye or its associated interests?” Jones is refusing to answer.
Dances with Bears
John Helmer

Merijn Knibbe — Can water be non-neoliberal? The Dutch case

Dutch drinking water is despite the absence of the use of chlorine the best. According to Science. Look also here. And here is Wikipedia. The secret? Good maintenance (according De Volkskrant of today, no link). And state of the art purification (without chlorine). Also, Dutch water companies do not have to pay dividends. They are government owned companies at arms length of the bureaucrats. They do not have to pay dividends and have, therewith, the money as well as the long term orientation to care about their product. This is a conscious choice. According to Wikipedia (didn’t know this before preparing this blog, thank you mister Pronk): ‘In 2004 the Netherlands passed a law which prevents any privately owned company from providing drinking water services to the public‘.…
Real-World Economics Review Blog
Can water be non-neoliberal? The Dutch case
Merijn Knibbe

The Arthurian — Hey Jude. Hey Noah.

"It's the private debt level, stupid."

The New Arthurian Economics
Hey Jude. Hey Noah.
The Arthurian

Robert Vienneau — Conservatism According to Corey Robin

The basic principles of conservatism are 1) some are better than others and 2) conserving the past, when #1 applies. Therefore, governance needs to be hierarchical and "traditional." No "risky" new experiments. 

How this is expressed results in different varieties of conservatism historically.

Thoughts On Economics

Jomo Kwame Sundaram — Lost Jobs, Lower Incomes, Rising Inequality

Optimistic claims about the TPP’s economic impacts are largely based on economic modeling projections published by the Washington-based Peterson Institute for International Economics.2 Its researchers used a computable general equilibrium (CGE) model to project net GDP gains for all countries involved. These figures have been widely cited in many countries to justify TPP approval and ratification. Updated estimates, released in early 2016 and incorporated into the World Bank’s latest report on the global economy,3 now stress income gains for the United States of $131 billion, or 0.5 percent of GDP, and a 9.1 percent increase in exports by 2030.4
The methodology of the Peterson study is flawed; consequently, growth and income gains are overstated, and the costs to working people, consumers and governments are understated, ignored or even presented as benefits. Job losses and declining or stagnant labor incomes are excluded from consideration, even though they lower economic growth by reducing aggregate demand.
The projections methodology assumes away critical economic problems and boosts economic growth estimates with unfounded assumptions.…
Some economists have pointed out6 additional misleading findings in the most recent Peterson Institute update….
In sum, the TPP will increase pressures on labor incomes, weakening domestic demand in all participating countries, in turn leading to lower employment and higher inequality. Even though countries with lower labor costs may gain greater market shares and small GDP increases, employment is still likely to fall and inequality to increase.…
Triple Crisis
Lost Jobs, Lower Incomes, Rising Inequality
Jomo Kwame Sundaram
Jomo Kwame Sundaram was an Assistant Secretary General working on Economic Development in the United Nations system during 2005-15, and was awarded the 2007 Wassily Leontief Prize for Advancing the Frontiers of Economic Thought.

Sunday, February 28, 2016

ZH — "Trump Must Be Stopped" Plead 'The Economist' And CFR As Financial Establishment Panics

…when such stalwart titans of financial establishmentarianism as the Council of Foreign Relations and "The Economist", who until now had been largely ignoring Trump's ascent in the political hierarchy finally unleash an all out assault and go after Trump on the very same day, you know that the flamboyant, hyperbolic billionaire has finally gotten on the nerves of some very high net worth individuals.…
Zero Hedge
"Trump Must Be Stopped" Plead 'The Economist' And CFR As Financial Establishment Panics
Tyler Durden

Ben Norton — DNC vice chair resigns, endorses Sanders, blasts Clinton’s “interventionist, regime change policies”

Congresswoman Tulsi Gabbard, vice chair of the Democratic National Committee, resigned on Sunday in order to endorse Democratic presidential candidate Bernie Sanders. Gabbard — who was the first Hindu and first American Samoan to be elected to Congress, as well as the youngest person ever elected to the Hawaii legislature, at age 21 — commended the leftist Vermont senator for his foreign policy, and his opposition to the hawkish policies of fellow presidential candidate Hillary Clinton. 
"After much thought and consideration, I've decided I cannot remain neutral and sit on the sidelines any longer," she wrote in an email to fellow DNC officers obtained by Politico. "There is a clear contrast between our two candidates with regard to my strong belief that we must end the interventionist, regime change policies that have cost us so much," Gabbard said. "This is not just another 'issue.' This is THE issue, and it's deeply personal to me," Gabbard continued. "This is why I’ve decided to resign as Vice Chair of the DNC so that I can support Bernie Sanders in his efforts to earn the Democratic nomination in the 2016 presidential race."
About those super-delegates:
Sanders’ campaign accused the DNC and Wasserman Schultz of “actively attempting to undermine” his bid for president.
In a Feb. 11 interview, Wasserman Schultz openly admitted that the Democratic Party’s superdelegate system, which consists of unelected party elites who have a large influence on the primary election, exists in order to ensure establishment candidates don’t have to run “against grassroots activists.”
CNN host Jake Tapper asked the DNC chair, “What do you tell voters who are new to the process who say this makes them feel like it’s all rigged?”
“Unpledged delegates exist really to make sure that party leaders and elected officials don’t have to be in a position where they are running against grassroots activists,” Wasserman Schultz explained.
“I’m not sure that that answer would satisfy an anxious young voter,” Tapper replied.
DNC vice chair resigns, endorses Sanders, blasts Clinton’s “interventionist, regime change policies”
Ben Norton | Politico

Zero Hedge — Caught On Tape: U.S. Test Fires Nuclear ICBM, Warns "We Are Prepared To Use Nuclear Weapons"

What was more disturbing than the actual launch, however, was the rhetoric behind it: instead of passing it off as another routine test, and letting US "adversaries" make up their own mind about what is going on, Deputy Defense Secretary Robert Work, who witnessed the launch, said the U.S. tests, conducted at least 15 times since January 2011, send a message to strategic rivals like Russia, China and North Korea that Washington has an effective nuclear arsenal. "That’s exactly why we do this," Work told reporters before the launch.

Of course, the #1 unspoken rule when launching ICBMs is to never explicitly say why you are doing it. By breaking said rule, it marks a much greater escalation in international diplomacy than merely test firing the nuclear-capable ballistic missile.
That, however, was not an issue and Work piled on, with the following stunner
"We and the Russians and the Chinese routinely do test shots to prove that the operational missiles that we have are reliable. And that is a signal ... that we are prepared to use nuclear weapons in defense of our country if necessary."
Well that's good to know.…
Zero Hedge
Caught On Tape: U.S. Test Fires Nuclear ICBM, Warns "We Are Prepared To Use Nuclear Weapons"
Tyler Durden

Zero Hedge — While Gundlach Was Warning That "Equities Are In A Bear Market" 2 Weeks Ago, He Was Busy Buying Stocks

"Talking your book."

Zero Hedge
While Gundlach Was Warning That "Equities Are In A Bear Market" 2 Weeks Ago, He Was Busy Buying Stocks
Tyler Durden

Xinhua — Chinese Premier urges G20 policy coordination

Li calls for concerted action.
"When formulating macroeconomic policies, G20 members need to keep in mind not just their own growth. They also need to look after the spillover effects of their policies," said Li in a video message to the G20 Finance Ministers and Central Bank Governors Meeting that opened Friday in Shanghai.
"We need to increase communication and coordination, and work together to secure the stability of the international financial market," said the premier.
Chinese Premier urges G20 policy coordination

Xinhua — China clarifies economic policies, reform agenda at G20 meeting

"No problem."
China clarifies economic policies, reform agenda at G20 meeting

China Daily — Wang: China won't be major rival to U.S.

What Chinese Foreign Minister Wang Yi did not say is they China will defend itself from the US and its allies, however, so forget trying to push China around. Moreover, like Russia China rejects US hegemony and unipolarism in favor of a multipolar world.

Wang: China won't be major rival to U.S.
China Daily

Henry Giroux on State Terrorism and the Ideological Weapons of Neoliberalism — Leslie Thatcher Interview

Public intellectual Henry Giroux discusses his new book, America's Addiction to Terrorism, and the terror that "is now such a central part of the political nervous system in the United States that it's become the major organizing principle of society."
Henry Giroux on State Terrorism and the Ideological Weapons of Neoliberalism
Leslie Thatcher, Truthout | Interview
Henry A. Giroux is the founder-animator of Truthout's Public Intellectual Project, a member of Truthout's board of directors and a frequent contributor - currently holds the McMaster University Chair for Scholarship in the Public Interest in the English and Cultural Studies Department and the Paulo Freire Chair in Critical Pedagogy at the McMaster Institute for Innovation and Excellence in Teaching and Learning. He is also a distinguished visiting professor at Ryerson University.

Evidence on the Coup in Ukraine

The more of the facts are steeping out through the propaganda barrage.

This is a reprint of an article in CFR's Foreign Policy, which requires subscription.

New Cold War: Ukraine and Beyond
He killed for the Maidan
Katya Gorchinskaya, Foreign Policy Magazine, February 26, 2016

This documentary is making waves in Europe.

Here is a link with English subs if you haven't seen it.

The Greanville Post • Vol. X
The Unmasking of the Ukrainian Color Revolution
Rowan Wolf

Chris Sturr — Yet More Links on Friedman-Sanders Kerfuffle

I can't keep up.

The D&S Blog
Yet More Links on Friedman-Sanders Kerfuffle
Chris Sturr

Alex Pareene — How We Fooled Donald Trump Into Retweeting Benito Mussolini

Punking Trump.

How We Fooled Donald Trump Into Retweeting Benito Mussolini
Alex Pareene

Neil Wilson — The Limits of understanding of MMT

I've got a good amount of time for LK's blog. It is my 'goto' blog for good sense on many a topic. But I have to say I'm somewhat disappointed at the latest missive on foreign trade. It still has the usual straw men in it. I really don't understand why PK people can't get their head around the dynamics of floating rate exchange systems and still stick to fixed exchange analysis based around apparent Kaldorian views.
Bill has already debunked the Kaldorian points in his post of a few weeks ago.
I'll take the points in LKs post one at a time.
The Limits of understanding of MMT
Neil Wilson

V. Ramanan — Occult Or Investment Banky?

Ramanan responds briefly to Noah Smith.

Noah Smith is a professor of finance. So I would add Hyman Minsky to Wynne Godley. 

Finance is also concerned with the monetary system. That brings in Post Keynesians like Basil Moore and MMT economists like Randy Wray, who is also an expert on Minsky.

The Case for Concerted Action
V. Ramanan

Prediction Markets update

HRC v. Trump, HRC favored. Dems to take Senate, GOP to hold House

Election Betting Odds

Odds Checker

Predict It


Iowa Electronic Markets

Ann Coulter Debates with Cenk Uygur of The Young Turks

Cenk Uygur, of The Young Turks, was once a Republican but he became a Democrat, and like Paul Craig Roberts he seems for speak to me. I connect with them. 

Cenk says that he’s still centre, or maybe a little a little bit to Right when it comes to economics, but he’s really a true liberal. He once said he was quite happy to pay 50% tax, which I think is quite generous from someone who was once on the Right.

Cenk Uygur once did an interview with Sam Davis who is a liberal hawk and is pro dropping nuclear bombs on other nations he doesn't like. He says it is a deterrent. Cenk asked Sam whether he would retaliate with nuclear weapons if an enemy fired them on his country, and Sam said yes, he would, but Cenk said that he wouldn't because millions of innocent people would die who hadn't  done anything wrong so why add more suffering? I thought that was such a honourable answer. Cenk is my man.  

In the interview below, Cenk Uygur debates with Ann Coulter and it get’s pretty lively. Most of the audience oppose Ann Coulter and she does get a lot of stick, but she fights back well. One shocking moment is when she says that she would take away the women’s right to vote because they can't be trusted to get it right and vote for Republican presidents. Gee!

Ann Coulter VS Cenk Uygur (TYT) 2015

Saturday, February 27, 2016

Alex Kirby — The United States Has Blocked a Plan by India to Expand Solar Power and Create Local Jobs

Because "free trade."
India has been told that it cannot go ahead as planned with its ambitious plan for a huge expansion of its renewable energy sector, because it seeks to provide work for Indian people. The case against India was brought by the US.
The ruling, by the World Trade Organisation (WTO), says India’s National Solar Mission—which would create local jobs, while bringing electricity to millions of people—must be changed because it includes a domestic content clause requiring part of the solar cells to be produced nationally.
What a difference two months make. On 12 December last year, US President Barack Obama praised the Paris Agreement on tackling climate change, just hours after it was finally concluded. “We’ve shown what’s possible when the world stands as one,” he said, adding that the agreement “represents the best chance we have to save the one planet that we’ve got”.
The WTO says that its dispute settlement panel “handed the US a clear-cut victory . . . when it found that local content requirements India imposed on private solar power producers in a massive solar project violated trade rules, although the two sides are still discussing a potential settlement to the dispute”.
One official of India’s Ministry of New and Renewable Energy told India Climate Dialogue that the ruling might make the country’s solar plan more expensive, and would definitely hit domestic manufacturing and, consequently, the possibility of creating jobs in the sector.
That's not all:
“In the last three months alone, Ecuador was ordered to pay $1billion for cancelling a petrol contract under a Bilateral Investment Treaty . . . Governments must be free to implement sound climate policy.
“This ruling shows the dangers posed by more wide-ranging trade agreements such as the Trans-Pacific Partnership (TPP), Trade in Services Agreement (TiSA) and Transatlantic Trade and Investment Partnership (TTIP), which will liberalise trade in dirty fossil fuels and restrict government options even further.”
The United States Has Blocked a Plan by India to Expand Solar Power and Create Local Jobs
Alex Kirby | Climate News Network

Jacob Heilbrunn — Why Trump Is Panicking Robert Kagan

The impulse of the neocons to return to the Democratic Party should not be wholly surprising. In 1972, for example, Robert L. Bartley, the editorial page editor of the Wall Street Journal, wrote that the fledgling neoconservatives represented “something of a swing group between the two major parties.” He was right. The neoconservatives had their home in the Democratic Party in the 1960s. Then they marched rightward, in reaction to the rise of the adversary culture inside the Democratic Party. George McGovern’s run for the presidency in 1972, followed by the Jimmy Carter presidency, sent them into the arms of Ronald Reagan and the GOP.
But it wasn’t until the George W. Bush presidency that the neocons became the dominant foreign policy force inside the GOP. They promptly proceeded to wreck his presidency by championing the war in Iraq. Today, having wrecked it, they are now threatening to bolt the GOP and support Hillary Clinton rather than Donald Trump for the presidency.
The National Interest
Why Trump Is Panicking Robert Kagan
Jacob Heilbrunn, editor of the National Interest

Peter Turchin — Another Victim of Ayn Rand’s Corrosive Objectivism: Sears

The story of the rise and fall of Eddie Lampert.

Cliodynamica — A Blog about the Evolution of Civilizations
Another Victim of Ayn Rand’s Corrosive Objectivism: Sears
Peter Turchin | Professor in the Department of Ecology and Evolutionary Biology at the University of Connecticut, Research Associate in the School of Anthropology, University of Oxford, and Vice-President of the Evolution Institute

Noah Smith — Occult Mysteries of the Heterodox


Occult Mysteries of the Heterodox
Noah Smith

See also

Information Transfer Economics
Break on through to the other side
Jason Smith

Pat Lang — Toward a "Borg" Definition

Col. Lang asks for submissions.

Sic Semper Tyrannis
Toward a "Borg" Definition
Col. W. Patrick Lang, US Army (ret.), former military intelligence officer at the US Defense Intelligence Agency

Matthew Allen — Hungary's Orban Says George Soros Is Destroying Europe

Soros is becoming a lightening rod.

Russia Insider
Hungary's Orban Says George Soros Is Destroying Europe
Matthew Allen

James K. Galbraith — Economic Forecasting Models and Sanders Program Controversy

The Romer/Romer letter to Professor Gerald Friedman marks a turning point. It concedes that there are indeed important issues at stake when evaluating the proposed economic policies of Presidential Candidate Bernie Sanders. These issues go beyond the political debate and should be discussed seriously between and among professional economists.

All forecasting models embody theoretical views. All involve making assumptions about the shape of the world, and about those features, which can, and cannot, safely be neglected. This is true of the models the Romers favor, as well as of Professor Friedman’s, as it would be true of mine. So each model deserves to be scrutinized.

In the case of the models favored by the Romers, we have the experience of forecasting from the outset of the Great Financial Crisis, which was marked by a famous exercise in early 2009 known as the Romer-Bernstein forecast. According to this forecast (a) the economy would have recovered on its own, in full and with no assistance from government, by 2014, (b) the only effect of the entire stimulus package would be to accelerate the date of full recovery by about six months, and (c) by 2016, the economy would actually be performing worse than if there had been no stimulus at all, since the greater “burden” of the government debt would push up interest rates and depress business investment relative to the full employment level.
It’s fair to say that this forecast was not borne out: the economy did not fully recover even with the ARRA, and there is no sign of “crowding out,” even now. The idea that the economy is now worse off than it would have been without any Obama program is, to most people, I imagine, quite strange. These facts should prompt a careful look at the modeling strategy that the Romers espouse.…
Dare I say smackdown. 

Economic Forecasting Models and Sanders Program Controversy
James K. Galbraith

Lars P. Syll — Bernie Sanders and the Verdoorn law

So, the nodal point is — has the Verdoorn Law been validated or not in empirical studies?
There have been hundreds of studies that have tried to answer that question, and as could be imagined, the answers differ. The law has been investigated with different econometric methods (time-series, IV, OLS, ECM, cointegration, etc.). The statistical and econometric problems are enormous (especially when it comes to the question, highlighted by Romer & Romer, on the direction of causality). Given this, however, most studies on the country level do confirm that the Verdoorn law holds — United States included. Most of the studies are for the period before the subprime crisis of 2006/2007, but if anything, it is more in line with Friedman than Romer & Romer.
Lars P. Syll’s Blog
Bernie Sanders and the Verdoorn law
Lars P. Syll | Professor, Malmo University

MMT, trade balance and balance of payments

The trouble with Neochartalism (and called “Modern Monetary Theory” by the Neochartalists) is that what is correct is not original and what is original is not correct.
A popular heterodox blogger writing under the pen name “Lord Keynes” and blogging at Social Democracy For The 21st Century has written a post Limits Of MMT.

It’s good to see the blogger point that the main trouble with Neochartalism is the balance of payments constraint. He/she has said this in the past in posts while promoting it, so it’s good to see a special post for this. I don’t agree with many things with “Lord Keynes” but given the blog’s popularity, I think it’s a good thing to have happened.
The Case for Concerted Action

Social Democracy For The 21St Century: A Post Keynesian Perspective
Limits of MMT
Lord Keynes



"Imports are a real benefit and exports are a real cost."
Transactions of real goods and services between those within the geographical confines of the U.S. and anyone outside the U.S. are generally defined as foreign trade. Exports are real goods and services leaving the country, and imports are real goods and services entering the country. By standard definition, exports are a real cost, and imports are a real benefit. Exports can be considered the cost of imports. Financial transactions are accounting information, and not considered as imports or exports.
The chronic U.S. trade deficit, for example, means the dollar price of imports continually exceeds the dollar price of exports. This puts increasing numbers of dollars in the hands of non-U.S. residents who have decided to hold dollar denominated financial assets rather than use their dollars to buy U.S. goods. This is an identity, for, if they did buy U.S. goods, there would not be a trade deficit. As holders of dollar denominated financial assets, they are net nominal savers, much like any domestic holder of dollar denominated financial assets. For purposes of this analysis, foreign dollar denominated financial holdings are considered part of H(nfa).
This is Econ 101. Nothing controversial about it. It says nothing about whether net imports are beneficial to the economy as a whole or to the nation as a whole. It's a comparison between financial and non-fiancial ("real"). A net importer is gaining "stuff in an exchange with a net exporter, and the net exporter is accumulating the currency of the net importer. Thus the net importer is benefiting in real terms while the next exporter is benefiting in financial terms. The net exporter is diminishing domestic product (real) for domestic use, and the net importer is increasing indebtedness (financial) to the net exporter.

On the other hand, net imports are beneficial to the economy and nation at full employment

The nation has more stuff than it would otherwise have at the current level of productivity. Because foreign workers are contributing to domestic productivity. And the country is not exporting jobs.

Unless economic policy offsets the cost of net exports in terms unemployment owing to embedded labor,  jobs are being lost to "silent" immigration. This may also involve exporting capital as domestic firms invest abroad to take advantage of less expensive labor. It can also result in the loss of industry since manufacturing is most likely sent abroad.

Center of the Universe
Full Employment AND Price Stability
Warren Molser
Stephanie Bell Kelton and John Henry address this in a CFEPS working paper and Joe Firestone in an NEP blog posst.
Hence, in the world we actually inhabit, free trade is not the panacea its proponents propagate. If we are to advance the economic interests of the bulk of the citizenry in a decent and humane fashion, we must promote a full employment policy domestically, and couple this with a flexible exchange rate regime internationally. With these institutions in place (on a global scale), exports become a cost and imports a benefit, and the conditions under which free trade is beneficial will have been established.
Center for Full Employment and Price Stability
Working Paper No. 26 — July 2003
Stephanie A. Bell [now Kelton].Department of Economics,University of Missouri, Kansas City and
The Center for Full Employment and Price Stability and John F. Henry, Department of Economics, California State University, Sacramento

New Economic Perspectives
Who Needs a Balanced Trade Policy?
Joe Firestone

China Billionaires

Picketty better get his ass over to China and pronto!!!!!

Friday, February 26, 2016

RT — Brazil-Europe undersea cable to hide web traffic from US snooping

A new underwater cable that is to link Brazil with Portugal will protect Latin American internet traffic from US surveillance, Brazilian President Dilma Rousseff indicated after meeting the presidents of the European Commission and the European Council.

“We have to respect privacy, human rights and the sovereignty of nations. We don't want businesses to be spied upon,”Rousseff told a joint news conference. 
Rousseff was among the world leaders who openly criticized the US after the revelation of the scale of its electronic surveillance program by NSA whistleblower Edward Snowden. She postponed a scheduled visit to America over a report that the US intelligence agency snooped on her emails and phone.
Not only Brazilian political leaders, but also captains of industry have been reportedly under US surveillance, including the oil giant Petrobras. Critics accused the US of using its intelligence capabilities for economic espionage that has nothing to do with national security.
Brazil-Europe undersea cable to hide web traffic from US snooping

Gordon M. Hahn— Working Paper – Revised/Updated Edition: Escalation Points 1-5 in the Ukrainian Revolutionary Crisis, November 2013 – January 2014

The following is the revised edition of the first edition of this working paper, first published on this site last year: WORKING PAPER: “Violence, Coercion and Escalation in the Ukraine Crisis: Escalation Points 1-5: November 2013 – January 2014,” Russian and Eurasian Politics, 9 April 2015,
Quite a different story from that reported in Western media.  

Russian and Eurasian Politics
Working Paper – Revised/Updated Edition: Escalation Points 1-5 in the Ukrainian Revolutionary Crisis, November 2013 – January 2014
Gordon M. Hahn

See also:
This is a preview of my forthcoming revision of my Working Paper on the Snipers’ Massacre of 20 February 2014 on the Maidan in Kiev, Ukraine. Although based much on Ottawa University Professor Ivan Katchanovski’s work, it includes some other data, including the following recent disclosure, confirming once more that the ‘sniper’s massacre’ or shooting at least on that pivotal day was not initiated by the Berkut or any other forces of the Viktor Yanukovych regime, no less of Russia. Rather, they were an internal false flag operation carried out by the neo-fascist and ultra-nationalist element – the Svoboda Party and Right Sector – of the EuroMaidan movement that turned the first peaceful Maidan protests into increasingly violent protests and a violent seizure of power.
February 20, 2014 ‘Snipers’ Massacre’: Another EuroMaidan Protester Acknowledges Killing Berkut [Police] First

Gordon Hahn is very conservative as his post on the the passing of Justice Scalia shows.

A Providential Passing: The Death of Judge Scalia…and the Constitition?

Dean Baker — Romer and Romer Do the Numbers on Friedman-Sanders

Since I had been critical of elite economists for using their authority rather than evidence to trash Gerald Friedman’s analysis of Bernie Sanders’ program, I should acknowledge a serious effort to do exactly the sort of analysis I advocated. Christina Romer, one of the four former heads of the Council of Economic Advisers who signed the earlier letter criticizing Friedman’s analysis, along with David Romer (both of whom are now Berkeley economics professors), did a detailed critique of the Friedman analysis.

I could quibble with aspects of their critique, but I would say it is basically right.…
Beat the Press
Romer and Romer Do the Numbers on Friedman-Sanders
Dean Baker | Co-director of the Center for Economic and Policy Research in Washington, D.C

Pete Dolack — What Might a Cooperative Economy Actually Look Like?

More questions than answers, but necessary questions to explore.

The organizational model underlying "capitalism" has been worked out over a long period of time and has adapted to changing context. Gaming a different model that scales is a daunting challenge.

The range of political theory has laissez-faire capitalism (market state) at the extreme right and totalitarian communism (command economy) at the extreme left. The next pair is managed capitalism (which is presently dominant in much of the world, represented by neoliberalism) and managed socialism (as in China now). The next pair is social democracy (Nordic model, welfare state) and democratic socialism (cooperative society based on humanism, which the author seems to be exploring).

The dialectic in the West is presently between neoliberalism as a type of managed capitalism and social democracy. Neoliberalism is still dominant, but social democracy is making a comeback politically with the rise of Bernie Sanders and Jeremy Corbyn, for instance. This is the likely course of history at this point.

Anarchism is another alternative. It has left and right expressions. Since anarchism assumes transcendence of the state, it is purely philosophical at this point in time, given the global context and historical dialectic.

What Might a Cooperative Economy Actually Look Like?
Pete Dolack

See also Susan Babbitt, Why Philosophy Mattered (and Should Still Matter) to Revolutionaries, at Counterpunch.

There's also a difference between knowledge and wisdom, which is why there is a need for liberal education that balances science and mathematics with the arts and humanities.

Daniel Newby — Opinion: The War Vultures Circling US Presidential Front-Runners

Donald Trump 
Painted as anti-establishment and friendly toward Russia, Republican front-runner Donald Trump nevertheless embraced Michael Glassner as his Political Director [1]. Glassner was a senior advisor to former presidential candidates Bob Dole and John McCain, both notorious military interventionists. He was also a Regional Political Director for the American Israel Public Affairs Committee (AIPAC) [2], a highly-influential organization with a long track record of lobbying for military invasions and aggressive sanctions against Israel’s neighbors [3].
Though publicly-distanced by Israel’s Netanyahoo regime over his views on restricting Muslims from immigrating to the US, Trump did campaign for Netanyahoo’s narrow re-election [7], and has claimed:

“The only [candidate] that’s going to give real support to Israel is me. The rest of them are all talk, no action. They’re politicians. I’ve been loyal to Israel from the day I was born. My father, Fred Trump, was loyal to Israel before me. The only one that’s going to give Israel the kind of support it needs is Donald Trump.” [8]
How will this “loyalty” and “support” for Israel translate into action? Trump irked many in the US Jewish community with some of his comments at a recent Republican Jewish Coalition forum [4]. Since then, however, he has set a provocative tone for future Middle East relations by publicly-recognizing Jerusalem as the capital of Israel [5]. In another snub to Palestinians contesting Israel’s territorial claims, Trump announced plans to move the US embassy to Jerusalem [6].
Another more ominous signal came last August, when Trump, who has frequently touted his opposition to the US invasion of Iraq, named former top US State Department official John Bolton as one of his top foreign policy advisors, stating: “He’s, you know, a tough cookie, knows what he’s talking about.” Part of the Bush-Cheney regime, Bolton was a staunch advocate for military invasions of Iraq and Iran. [9]
Does Trump naively assume that an old guard antagonist like Bolton will change his ways and begin recommending more constructive and respectful US foreign policy paths? Or do war vultures like John Bolton fit with Trump’s political agenda?….
The other candidates are all associated with neocons or war hawks, excepting Bernie Sanders. From this analysis, Bernie emerges as the best candidate to avoid conflict.

South Front
Opinion: The War Vultures Circling US Presidential Front-Runners
Daniel Newby

Paul Craig Roberts

I first came across Paul Craig Roberts when he wrote the book, The Failure of Laissez Faire Capitalism, which I think Amazon recommended for me for my kindle. Before that I had never heard of him but I downloaded the free kindle sample and I was knocked out by it so much that I bought the book straight away.

I was very  intrigued because he was once Reagan’s chief economic advisor and was the co-founder of Reaganomics, but here he was deeply attacking present day capitalism, the very thing he seemed to have started.  Reaganomics also influenced Margaret Thatcher and she went on a privatization spree which became known as Thatcherism. 

Anyway, I thought that the Failure of Laissez Capitalism could have been written by any rampart left winger, like myself, but it was written by someone who had been very much on the Right. He also attacked libertarianism as a crackpot idea and said that he was once a libertarian himself until he saw the light. This became one of the best political books I had ever read.

But PCR does occasionally throw in some surprises, though, like the way he deeply admires Ronald Reagan, and if you are a lefty, like me, then Ronald Reagan is one of the most hateful figures. But PCR says that no president can keep his eye on everything and that Reagan wasn't aware of  the Iran Contra-Rebel scandal until it got exposed. But PCR never mentions all the other atrocities that occurred in Central America under Reagan's watch.

PCR also admires Reagan for bringing about peace with Russia and reducing the amount of nuclear weapons in the world which was a fantastic news leading to the end of the Cold War.  And it is said that he wanted complete nuclear disarmament but Margaret Thatcher talked him out of it by saying that the Russians had too many tanks employed ready to invade Europe. PCR says that military-industrial banking complex were furious with Reagan.   

But apart from the occassional surprise I would say that PCR is very much on the Left nowadays, although no one is perfect and maybe he can't acknowledge that there may have been some mistakes in his past economic policies. But he says that when Reagan came to power Keynesianism had run its course and it was now time for supply side economics. But we know that real Keynesianism was never properly implemented as the ruling class would never allow it, so neo-Keynesianism was practiced instead which messed everything up. PCR says that you need both sides in a balance, supply and demand.

I love Paul Craig Roberts, I really do, and Michael Hudson. I wrote to Michael Hudson - who used to call himself a Marxist and is still no doubt a committed  socialist - about PCR and said, would you believe it, he's one of us, and he wrote back and said that even right wingers get it right sometimes? Nowadays PCR and Michael Hudson are friends.

And PCR likes all the people on the left that I do, including Eric Zeusse, a very brave journalist, John Pilger, Chris Hedges and many more.

It takes a very brave person to switch politically but he says that he never did, that he was always a radical who was never pinned down to either left or right.  He's a fantastic guy, a champion for decency, fair and goodhearted values, and for a capitalism that really does work for the ordinary guy as well as remaining compassionate for those less of us who are less fortunate. That's socialism.

Lord Keynes — Will Trumponomics be Reaganomics Mark II?

LK speculates on alternative scenarios.

I would not be surprised to see a return of something similar to Reaganomics and the appointment of Art Laffer to some position.

Social Democracy For The 21St Century: A Post Keynesian Perspective
Will Trumponomics be Reaganomics Mark II?
Lord Keynes

F. William Engdahl — Russia Bans US GMO Imports

Russia is making consequent its decision last fall to ban the commercial planting of Genetically Modified Organisms or GMO in its agriculture acreage. The latest decision, effective February 15, 2016 does not at all please Monsanto or the US Grain Cartel.
On February 15, a Russian national import ban on soybeans and corn imports from the United States took effect. The Russian food safety regulator Rosselkhoznadzor announced that the ban was because of GMO and of microbial contamination and the absence of effective US controls on soybean and corn exports to prevent export of quarantinable grains, also known as microbial contamination. The Russian food safety regulator added that corn imported from the US is often infected with dry rot of maize. In addition, he said, corn can be used for GMO crops in Russia. The potential damage from import and spread of quarantinable objects on the territory of Russia is estimated at $126 -189 million annually.
The Russian decision is a huge blow to USA agribusiness. For decades, the US grain cartel companies–ADM, Cargill, Bunge–have dominated the global trade in soybeans and corn, the most widely used animal feed for cattle, pigs, chickens because of its high protein content.
Russia bans growing and importation of Frankenfoods.

Russia Bans US GMO Imports
F. William Engdahl

Peter Dorman — Romer^2 on Friedman on Sanders

Oh dear. Today's Romer and Romer response to Gerald Friedman’s paper on the economic consequences of Sanders seems to have identified the core problem in GF’s analysis, confusing one-time and ongoing stimulus effects. According to the R team, F attributed increases in economic growth in perpetuity to single bursts of stimulus, and not just once but repeatedly—in his treatments of demand stimulus, income redistribution and health care. That plus his belief that the output gap is large enough to accommodate extremely rapid growth over a full decade, explains his headline numbers. If this is true it’s an embarrassment.…
Romer^2 on Friedman on Sanders
Peter Dorman | Professor of Political Economy, The Evergreen State College

See also

No recession. Q4 GDP revised up. Flows tell it all, as we have been saying. Deficit based forecasts have been wrong, wrong, wrong.

How many times do we have to say it? Matt and I have been saying over and over and over that these deficit-based forecasts are stubborn and wrong and it's all about the flows. And we've been right.

With $4-trillion-plus and rising (year-over-year) there won't be recession. Slow growth, perhaps, and that's because of the drag from lower capex in the energy sector, however, it's being offset by higher consumption.

The deficit-based forecasters have been wrong for three years running. If, five years from now, the economy goes into recession because of some unrelated reason, are all of you going to say that the deficit-based forecasters "called" it?

Come on.

Nord-Stream 2

Uh oh:
Nord Stream is a Baltic Sea gas pipeline linking Russia directly to Germany, bypassing Ukraine. 
The Germany-favoured Nord Stream 2 plan has bitterly divided the European Union since an outline agreement with Russian gas export monopoly Gazprom was signed in September last year.

Keyword here being "Germany-favoured".

Germans hooking up directly with the Russians bypassing all the chaos, achieving beloved teutonic efficiency, making a ton of munnie.

No one is going to stop this its just too good.

The Art of David Dees

Thursday, February 25, 2016

Robert Parry — Neocon Kagan Endorses Hillary Clinton

Hillary Clinton’s cozy ties to Washington’s powerful neocons have paid off with the endorsement of Robert Kagan, one of the most influential neocons. But it also should raise questions among Democrats about what kind of foreign policy a President Hillary Clinton would pursue, writes Robert Parry.
Parry tells the tale of the total catastrophe that is Hillary Clinton.

Consortium News
Neocon Kagan Endorses Hillary Clinton
Robert Parry

Marina Obrazkova — The most important facts about Russian parliamentary elections


BTW, the West would vastly prefer Putin's party to the only other parties that are actually in the running with significant constituencies. Regime change would be opening Pandora's box.

Russia Direct
The most important facts about Russian parliamentary elections
Marina Obrazkova

OAN — China Central Bank Head Says China Has More Room To Support Economy

China still has more room and tools in its monetary policy to tackle downward pressure in the economy, and its fiscal policy will be more proactive, central bank governor Zhou Xiaochuan said on Friday.…
Seems clear that the PBOC will support fiscal policy rather than counter it to manage inflation, as Western central banks do.

China Central Bank Head Says China Has More Room To Support Economy
Reporting by Samuel Shen and Jason Subler; Editing by Shri Navaratnam

See also:
Zhou said in Caixin the interview that there’s no basis for continued yuan depreciation, that the nation’s balance of payments is good, capital outflows are normal and the exchange rate is basically stable against a basket of currencies. China has no incentive to depreciate the currency to boost net exports, and there’s no direct link between the nation’s gross domestic product and its exchange rate, he said.
Bloomberg,  PBOC's Zhou Says China Still Has Monetary Space to Aid Economy

Tarini Parti — Anti-Trump Groups Say Some Donors Are Worried About Being Targeted By Trump

“I hear the Rickets [sic] family, who own the Chicago Cubs, are secretly spending $’s against me. They better be careful, they have a lot to hide!,” Trump tweeted.

Thomas Piketty — A New Deal for Europe

We have a single currency with nineteen different public debts, nineteen interest rates upon which the financial markets are completely free to speculate, nineteen corporate tax rates in unbridled competition with one another, without a common social safety net or shared educational standards—this cannot possibly work, and never will.
Only a genuine social and democratic refounding of the eurozone, designed to encourage growth and employment, arrayed around a small core of countries willing to lead by example and develop their own new political institutions, will be sufficient to counter the hateful nationalistic impulses that now threaten all Europe.…
If France, Italy, and Spain (roughly 50 percent of the eurozone’s population and GDP, as against Germany, with scarcely more than 25 percent) were to put forth a specific proposal for a new and effective parliament, some compromise would have to be found. And if Germany stubbornly continues to refuse, which seems unlikely, then the argument against the euro as a common currency becomes very difficult to counter. Currently, a Plan B involving the abandonment of the euro is being touted by the far right, a policy that is increasingly tempting to the far left. Why don’t we start by actually giving a chance to genuine reforms that would make the eurozone work for the common good?
The New York Review of Books
A New Deal for Europe
Thomas Piketty
Translated from the French by Anthony Shugaar
ht Brad DeLong

David Keohane — Citi: Increasing chance that winter is indeed coming

The growing threat to the global outlook rests on poor fundamentals, which include the pre-existing fragilities related to the structural and cyclical slowdowns in China and its unsustainable currency regime, broken EM growth models, excessive leverage across many countries and sectors, and rising regional risks (Brexit) and geopolitical risks (including in Russia, Turkey and Syria, the South China Sea, and North Korea).
These fundamental concerns are aggravated by a crisis of confidence that is in part fuelled by a growing worry that, should conditions deteriorate, they may not elicit an effective policy response.…
The Financial Times — FT Alphaville
Citi: Increasing chance that winter is indeed coming
David Keohane
ht Brad DeLong

Charlotte D'Ornellas — At Notre Dame de Paris, a few choice words from the Bishop of Aleppo

Visiting France on the occasion of the Night of Witnesses organized each year by Aid to the Church in Need, the Greek Melkite Archbishop of Aleppo, Mgr Jeanbart, had a heavy heart. After describing the dramatic situation facing Aleppans, the Syrian bishop addressed the audience of journalists there:
"The European media have continued to choke the lives of those suffering in Syria and have even helped to justify what is happening in our country by passing on reports without ever checking," he began, lambasting press agencies including agencies created during the war "put up by the armed opposition," like the Syrian Observatory for Human Rights, that uncontradicted source for Western media.
"You have to understand that between the Islamic State and the Syrian government, our choice is quickly made. One can condemn the regime for some things, but you never tried to be objective," he further accused.
Asked whether he could explain his position to the French authorities, Archbishop Jeanbart said he had tried before, only to be told that he had to be "less critical."
For him, however, the West has continued to silence the exactions of the armed opposition, all the while damning the Syrian government and its president. "Assad has many faults, but imagine, he has also qualities," he explained, "schools were free, as hospitals, mosques as churches paid no tax, but be honest, what other government in the region does such things? Remember this, too: if we prefer to support the government, it is because we fear the establishment of a Sunni theocracy that would deprive us of the right to live on our own land."….
Fort Russ
At Notre Dame de Paris, a few choice words from the Bishop of Aleppo
Charlotte D'Ornellas, Boulevard Voltaire, January 29, 2016
Translated from French by Tom Winter, February 25, 2016

Ian Welsh — Trumponomics – How the Trump Economic Plan Will Work

Ok folks, let’s say what people keep refusing to say:
Trump’s economic plan makes sense and will work.
Ian Welsh
Trumponomics – How the Trump Economic Plan Will Work

Deirdre Fulton — Linking Clinton Policies to Poverty, Sanders Lays Out Plan to Help Nation's Poor

"What welfare reform did in my view was to go after some of the weakest and most vulnerable people in this country," says Bernie Sanders…
To address this scourge, Sanders called for the federal minimum wage to be lifted from $7.25 an hour to $15 an hour; proposed a youth jobs program to create 1 million jobs for young Americans; and urged support for a $1 trillion, five-year push to put 13 million Americans to work in good-paying jobs rebuilding roads, bridges and railways.…
On Wednesday, Sanders also advocated for a Medicare-for-all, single-payer healthcare system to help reduce poverty.
Common Dreams
Linking Clinton Policies to Poverty, Sanders Lays Out Plan to Help Nation's Poor
Deirdre Fulton, staff writer

Michael Crowley — Sanders reaches out for foreign-policy help

Lawrence J. Korb, a defense policy expert at the Center for American Progress, told POLITICO that Sanders called him Sunday to ask whether the Vermont senator can name him as an adviser to his campaign. Korb agreed.…
Sources said the Sanders campaign has also hired Bill French, a policy analyst at the left-leaning National Security Network, as a foreign policy staffer—apparently the campaign's first full-time aide in that area. French referred questions to the Sanders campaign, which did not respond to a query. His hiring was first reported today by Foreign Policy. Korb spoke highly of French, noting that French had once interned for him.…

And in what may be a sign of the challenge Sanders has faced in finding Democratic experts unaligned with — or willing to alienate — Hillary Clinton, he has reached out to at least one former member of George W. Bush’s administration.
Of course, it might also be the case that Bernie thinks Larry Wilkerson knows a thing or two.

Unfortunately, Sanders has walked back his quote of 40 years ago about abolishing the CIA.

See also:

Korb confirms that Sanders is a foreign policy realist.

Lawrence Korb, Bernie Sanders Is More Serious on Foreign Policy Than You Think

Alexei Lossan — What will Russia be like in 2030?

Gathered at a forum in the heart of Siberia, leading Russian economists have outlined their vision for the country's future. Discussions at the Krasnoyarsk Economic Forum focused on issues including decentralization, developing food technologies and healthcare.
Russia Beyond the Headlines
What will Russia be like in 2030?
Alexei Lossan, Rbth

Ken Blanchard — China says 'really needs' South China Sea defenses in face of United States

China "really needs" its defenses in the South China Sea in the face of a militarization process being pushed by the United States, and can deploy whatever equipment it wants on its own soil, China's Defence Ministry said on Thursday.…
"The United States is the real promoter of the militarization of the South China Sea," defense ministry spokesman Wu Qian told a regular monthly news briefing.…
Wu said the U.S. was employing double standards, asking why U.S. patrols in the South China Sea should not also be considered militarization.
China says 'really needs' South China Sea defenses in face of United States
Ken Blanchard

RIA — Breedlove: US Ready To "Fight and Defeat" Russia in Europe

The U.S is ready "to fight and defeat" Russia in Europe, if necessary, said the commander of European command U.S. General Philip Breedlove.

"We are ready, if necessary, to fight and win," — said Breedlove at a hearing of the Committee on armed services of the U.S. house of representatives, to discuss measures to counter "Russian aggression" in Europe.
Fort Russ
Breedlove: US Ready To "Fight and Defeat" Russia in Europe
Translated by Ollie Richardson for Fort Russ

Putin has already warned that Russia will use nuclear weapons if NATO crosses its red lines.
Ultimately, in pursuing Russia’s goals, Putin is a pragmatist, and we should be too. In figuring out how to deter the United States and NATO, Russia does not have the military or economic resources for the 20th century mass-army, total mobilization approach to defending its interests. As Clifford Gaddy and I outlined in the Coda of our book (in the appendices), Putin has to combine conventional, nuclear, and non-conventional, non-military—so-called “hybrid” methods—to secure an advantage. Putin and his security team aim to intimidate us. They have to demonstrate that Russia has the capacity to act, and is willing to escalate on all fronts to deter the United States and NATO from considering taking any military action against Russia—in Ukraine, Syria, or elsewhere.

Nuclear weapons are the ultimate deterrent. Russia’s unclassified national security strategy states that Russia will use nuclear weapons only in response to an attack with weapons of mass destruction on Russia or on a Russian ally, or in the event of an attack on Russia with conventional forces in which the existence of the Russian state is at stake. But Moscow has now put the nuclear option on the table for lesser circumstances, and Putin seeks to make us believe that he will use nuclear weapons if any of the current conflicts seem likely to draw in the United States or NATO against Russian forces. It is no good for Putin to just suggest that he might use nuclear weapons. This is the “escalate to de-escalate” contingency that so many observers are currently concerned about at the non-strategic level (See Steven Pifer’s piece in The National Interest in the appendices). Putin is clearly drawing up a contingency for deploying nuclear weapons if he feels he needs to—but his goal is to push the United States and Europe away from Russia and out of its neighborhood, not to actually engage in a nuclear exchange. Nonetheless, we are now back in a similar frame to the nuclear war scare of the 1980s, which only ended with the Reagan and Gorbachev summitry that led to the conclusion of the 1987 INF Treaty.
Understanding And Deterring Russia: U.S. Policies And Strategies
Dr. Fiona Hill, Senior Fellow,
Director, Center On The United States And Europe
Testimony To The House Armed Services Committee Wednesday, February 10, 2016 

Back to the Cold War, only this time with "the crazies" running US policy.

Update regarding "Russia does not have the military or economic resources for the 20th century mass-army, total mobilization approach to defending its interests."
FIRST GUARDS TANK ARMY. I attended many meetings with the Russian military. Always – always – we were told that the Russian army was being re-structured into brigade group formations: all-arms formations of 5-6 thousand men. Such formations are suitable for fighting in places like Chechnya and, indeed, the first two were formed about 20 years ago in the south. At the same time there were no serious forces deployed along the tradition western invasion route. The old Soviet divisions – pretty well empty of soldiers at this time – were gradually eliminated. It was clear then – the 1990s and early 2000s – that Moscow was not expecting an attack from the west and neither did it expect to attack west: it was planning for smaller operations, mostly counter-terrorist. The old Soviet structure of divisions-armies-fronts which was applicable to really big wars against first-class enemies was no longer necessary; the smaller, nimbler brigade group structure was more appropriate. But, at the same time they warned that NATO’s relentless expansion, ever closer, was a danger (опасность), although they stopped short of calling it, as they did terrorism, a threat (угроза); “dangers” require attention; “threats” a response. NATO of course didn’t listen, arrogantly assuming NATO expansion was doing Russia a favour and was an entitlement of the “exceptional nation” and its allies. Well, we have reached another stage on the road. 
The 1st Guards Tank Army is being re-created. It will likely have two or three tank divisions, plus some motorised rifle divisions, plus enormous artillery and engineering support, plus helicopters and all else. This is a formation to fight a really big war against a first class enemy; designed to deliver the decisive counter-attack (see Stalingrad, Kursk). It will be stationed in the Western Military District to defend Russia against NATO (yes defend! otherwise why didn’t they have it all along?). It will likely be the first to receive receive the new Armata family of AFVs and be staffed with professional soldiers. This is what the light-hearted decision to expand NATO has brought us to. I need hardly say that NATO’s piddling little reinforcement is below the noise level of a tank army. (And pointless, too: a brigade more-or-less is meaningless in a real war and the trip-wire already exists. But NATO is working itself up to a real case of the screaming meemies.) I will probably write more on the significant of this, which is clearer to those with a military background, but here’s something to go on from Southfront. 
Russia Observer
Patrick Armstrong

See also

US set on regime change in Russia and will pursue this goal to the bitter end.

Sic Semper Tyrannis
Why is the US so hostile to Russia? Biil Herschel and PL