Elizabeth Warren’s Facebook page has posted the interview on the Charlie Rose show titled Elizabeth Warren on the 2008 Wall Street Bailout.

Elizabeth Warren talks with Charlie Rose about why the system is rigged against working families.

This is a great under 10 minute summary of what is at the heart of Warren’s new book. I think there are many avid Warren supporters who still don’t understand the depth of the problem she is fighting. In under 10 minutes you can get a heart wrenching look at what is at stake here.

If only people would listen, I think everybody with a soul would finally get the point.

Naked Capitalism has the article The Chronic Exporters’ Curse? by Yves Smith.

The article covers a number of facets of the issue.  She starts with a discussion of why the oligarchs don’t want the government to solve the unemployment problem.

Michal Kalecki made this point in his seminal essay, “Political Aspects of Full Employment” in 1943:

The reasons for the opposition of the ‘industrial leaders’ to full employment achieved by government spending may be subdivided into three categories: (i) dislike of government interference in the problem of employment as such; (ii) dislike of the direction of government spending (public investment and subsidizing consumption); (iii) dislike of the social and political changes resulting from the maintenance of full employment.

Yves Smith goes on to a discussion of some of the problems with being a chronic exporter.

One of the issues with being a chronic exporter is that you are effectively funding your sales. You wind up exporting capital. You sell your goods to them and take their currency in return. Now of course, you could just sell those dollars or euros or pesos and convert it into your currency, but that is pretty much never done on a large scale, since selling those currencies will drive the home currency price up relative to them, undermining your position as exporter. Now the exporter can simply hold those foreign currency payments as cash, but that is seen as unimaginative, so most recipients at least put it into something with more yield (government bills or bonds) or more speculative assets (stocks, real estate, re-investment in the country in question).

She goes on to relate her experiences advising Japanese entities on mergers and acquisitions in the U.S. during the ascendancy of the Japanese economy. The foreign investor is usually an easy mark for the banks and local investors. I have often thought about the idea of lifting investment restrictions on Chinese companies putting their country’s excess U.S. reserves to use. We could manage to cheat them just the way we did to Japanese investors.

I have thought that eventually the Chinese could stop depending on exports to create full employment when they transitioned to using their domestic market demand to maintain full employment. Yves Smith explains the problem with that idea.

… no country in modern times has made a crisis-free transition from being export-driven to having a large domestic consumer base. Development economists, late to recognize this issue, now recommend a more balanced growth model that places less emphasis on exports and more on building internal markets. But the current export champions seem unwilling or unable to abandon their past successful formula, even when it’s not working as well for them as it once did.

The one danger we face in trying to take advantage of knowing that a situation cannot go on forever, is that we don’t know exactly how that bad situation will end.  If we bet on the wrong mode of change, we could end up making a losing bet. Diversification would seem like a prudent course of action.

The Washington Post has the story Cantor faces tea party fury in his back yard.

Just a few miles from his family home, House Majority Leader Eric Cantor (R-Va.) felt the wrath of the tea party Saturday, when activists in his congressional district booed and heckled the second-most powerful House Republican.

I must admit to suffering from a severe case of schadenfreude. Perhaps now Eric Cantor knows how Dr. Frankenstein felt.

Steve Grossman, candidate for Massachusetts Governor, sent me an email with a link to his web page Save Net Neutrality!

This week, the FCC is set to vote on new rules about how government regulates and protects the free flow of information on the Internet. We can’t afford to allow extraordinary wealth to buy special access to high-speed traffic and repress free speech for the rest of us when we’re online.

It occurs to me that I have not been posting anything about why I am a supporter of Steve Grossman for Governor.  It’s certainly not that I am a one issue voter and that issue is net neutrality.  This position that Steve Grossman has taken is just one of the things that indicates to me that he really gets how the issue of extraordinary wealth concentration in the hands of the few has impacts on the rest of us in almost every aspect of life.

The one voice that we have had that the rich have not been able to throttle has been the internet.  It is no surprise that they want to control that too.  We can’t beat them by using superior wealth.  We can’t let them take away the one force that we have, and that is our numbers in the “public square” and at the ballot box.

I received an email from a friend who grew up in Russia, but has been living in  the USA for at least the 20 years that I have known him.  I am always curious about what he thinks of the Russian/Ukrainian situation, but I try not to pester him with too many questions.

Today, he sent me this unsolicited email.

Hi Steve,

I hope you will publish this on your blog.

First of all the disclaimer, I do not support either Russian or Ukrainian side in this conflict – I just do not know enough to have an educated opinion.
Hence I do not  side with either.

However, I am very disappointing with the NPR coverage of the conflict – I find it not only biased but explicitly misleading.

This Sunday, while listening to NPR report from the eastern Ukraine, on the the NPR correspondents
(I think this was  Silvia Poggioli, but I am not 100% sure) interviewed a couple of local residents.

One of them said the following, literally, in Russian: “I am a machine operator working for a factory. I think that this conflict is blown out of proportion by politicians on both sides, who are trying to pursue their own political goals. I am interested in my job and feeding and providing for my family …”.

The NPR translation:

“My Russian Supervisors receive orders from Moscow and force me to cut all my ties and boycott any Ukrainian authorities, …”.
Later. the corresponded has elaborated on how the unrest is sponsored and promoted by Russia.

The second interview was among the same lines.

The local people sounded completely apolitical, “live me alone”.
The NPR coverage tone was that Russia is stirring an unrest in this region. Even if it is so, it was not evident from the interviews.

I really was expecting much more honest coverage from especially the NPR.

Regards,

-Leon

Ever since public broadcasting became fearful of the right-wingers in Congress about continued funding of public broadcasting, I have noticed a profound rightward tilt to PBS and NPR reporting. That they would actually lie is not a surprise. With the number of multi-lingual native Russian speakers in this country, I do wonder how NPR thought they could get away with this.

For example Pando has the article More PBS conflict woes as activists move to eject David Koch from board of “NOVA” station.

Last month, Pando’s “Wolf of Sesame Street” investigation broke the news that one of PBS’s flagship outlets had inked a secret deal with anti-pension billionaire John Arnold. That deal, which was not explicitly disclosed to viewers, was designed to broadcast anti-pension programming on public television stations throughout the country.

The story spotlighted how ideological billionaires and powerful corporations are increasingly – and stealthily – attempting to launder their political agendas through the trusted public-television brand, potentially in violation of PBS’s own rules.

Naked Capitalism has the post Has America’s Use of Finance as a Foreign Policy Tool Backfired? by Yves Smith.  There is much to quote from the post, but I have selected a quote that Yves Smith made from the article The murderous history of USAID, the US Government agency behind Cuba’s fake Twitter clone by Mark Ames.

    There were many ways to transform Russia in the 1990s, but thanks to funding from USAID, the path chosen was the most brutal and disastrous of all: Shock therapy, mass privatization, and the mass impoverishment of 150 million people. As Janine Wedel and my former eXile partner Matt Taibbi documented, USAID funding and support empowered a single “clan” from St. Petersburg led by Anatoly Chubais, who oversaw the complete destruction of Russia’s social welfare system, and the handing over of lucrative assets to a tiny handful of oligarchs.

Under Chubais’ stewardship, Russia’s economic output declined some 60% in the 1990s, while the average Russian male life expectancy plummeted from 68 years to 56 years. Russia’s population went into a freefall, Russia’s worst death-to-birth ratio at any time in the 20th Century — which is amazing when you think that USAID’s privatization program had to compete with the ravages Hitler, Dzerzhinsky and Stalin wreaked on Russia.

USAID funded Chubais through public-private organizations and a Harvard program that was so patently corrupt, Harvard and its program directors including economist Andrei Shleifer were sued by the US Department of Justice for “conspiring to defraud” the US government (not to mention Russians). USAID also paid public relations giant Burson-Marsteller to sell the disastrous voucher program to the Russian public, in a mass media advertising blitz that promoted Chubais’ political party on the eve of parliamentary elections. It was this USAID funded privatization, and the USAID-backed Russia “democrats,” which soured Russians on market capitalism and democracy (renamed “dermokratsia” or “shitocracy” in Russian).

What the Yves Smith article has to say about Larry Summers’ and Harvard’s role is devastating.  We all need to say ,”Thank you Elizabeth Warren for preventing Larry Summers’ from becoming the Chairman of the Federal Reserve.  We dodged a major bullet with that one.”  As a Harvard insider, perhaps Elizabeth Warren knew the real reason Summers was dismissed as Harvard President.

The Real News Network has published two of the three segments so far. The first segment is Who Makes US Foreign Policy? – Lawrence Wilkerson On Reality Asserts Itself (1/3).

WILKERSON: Well, here’s the real–this sometimes drives me, you know, to drink. When Jim Baker and George H. W. Bush really accomplished what I think was one of the real diplomatic feats of the end of the 20th century, the reunification of Germany, whether we agree with that or not, they did it, and they did it without a shot being fired. It was wonderful to watch H. W. Bush do that and Jim Baker. But one of the reasons they could do it was because they assured Gorbachev, and later Yeltsin, that NATO would be quiescent, it wouldn’t move, it wouldn’t threaten Russia. In fact, I was there when we told the Russians that we were going to make them a member, we were–observer first and then a member and so forth. Well, that fell apart on the fact that they perceive right quickly that we weren’t really serious. And then we start, under pressure from Lockheed Martin and Raytheon and others, to sell weapons to Poland and weapons to Georgia and weapons to Romania and everybody else we could bring into the fold. Under those pressures and others we started to expand NATO and stuck both our fingers in the Russian eye, so to speak, immediately.

It’s clear to me why Putin responded in Georgia and why he’s now responding to Crimea in Ukraine. This is what great powers do when they get concerned about their so-called near abroad. So we have as much fault here as anybody else in this situation, and I don’t think President Obama–I think he bought it when he came in. He did not realize–why should he? He didn’t have the experience in this regard. He didn’t realize what we we’re doing and what might come about from what we were doing, and he just went along with it.

The second segment is Who Makes US Foreign Policy – Lawrence Wilkerson On Reality Asserts Itself (2/3).

JAY: So if you look at Jeb Bush, who you would think is a far more–or whoever’s the American Republican nominee, but certainly Hillary, this rapprochement with Iran, the sort of strategic shift–’cause it is one.

WILKERSON: It would be.

JAY: It would be.

WILKERSON: A major one. Thirty years of animosity.

JAY: Is Hillary on that page? Is there–when you go back to this–.

WILKERSON: Not from what I’m hearing.

JAY: Yeah, because–.

WILKERSON: She’s scaring me.

JAY: Yeah. When you go back to that vote that took place back around 2007, 2008, the one where they were going to declare the Iranian Revolutionary Guard as a terrorist organization, which is essentially saying the Iranian state is terrorist, but they want to try to find some way to do it that didn’t come out and say that, I mean, most of the leading Democrats voted against that motion, most of–all the better foreign policy minds, including President Obama. I mean, everyone was against that thing. And he wasn’t then president. But Hillary voted for it with the Republicans.

WILKERSON: She scares me. She frightens me. If it’s rhetoric, that’s one thing. If it’s heartfelt belief, that’s another. But even if it’s just rhetoric, to more or less court the conservatism of America, which all the pundits are always talking about, it still scares me, because you often get trapped by your rhetoric.

This is another thing that scares me about Hillary Clinton as President, too. This is just another aspect of what scares me about her on domestic policy. She is just a sympatico on the domestic front with the oligarchs running our government as she is on the foreign front with these same interests.

Unless someone from the Elizabeth Warren wing of the Democratic party runs for President, then I am not very optimistic about the race in 2016.

Naked Capitalism has the article Is the Strong Dollar the Real Cause of the Collapse of US Manufacturing and Secular Stagnation?

The article was written by Douglas L. Campbell, PhD candidate in Economics, University of California, Davis.

My job market paper seeks to identify a causal impact of real exchange rate movements on manufacturing output in the US (Campbell 2014). I compare:

• The US experience in the early 2000s to the 1980s, when large fiscal deficits led to a sharp appreciation of the US dollar; and

• Canada’s experience in mid-2000s, when high oil prices and a falling US dollar led to an equally sharp appreciation of the Canadian dollar.

I am wondering if Campbell is suffering from the problem of equating correlation with causation.

I commented on the article with my initial reaction.

I am having a hard time wrapping my head around the idea that large fiscal deficits raise the value of a country’s currency. What’s the economic theory behind that idea?

Also, I am wondering how China benefits by holding large reserves of US money. They are giving us the benefit of their labor in trade for holding our currency that they cannot do anything with except leave it on deposit at the Federal Reserve. Oh yes, they are earning interest which just adds to the money they are holding that they cannot use.

How do they pay for the raw materials that go into the goods that they are selling us? Does that mean that their labor adds enough value to pay for the cost of the raw materials  and still have huge profits left over? And they can also pay for whatever raw materials they actually use domestically? Someone needs to figure out where is all the money we give to China going. Not all of it is being used to build reserves.

As I mulled this over the dawn started to dawn.  I also posted that as a comment.

I just think I figured out what China gets out of building all these reserves. It is exactly the same issue about what the .1% in this country get for accumulating all the wealth. Try as they might, they can’t possibly spend all the money they are raking in. If they were spending it, they wouldn’t be accumulating it. What they are getting and what China is getting is power and control.

You cannot come up with an economic value to explain the level of power and control that is being concentrated in the hands of fewer and fewer people. The value is psychological. If we continue to search for economic reasons for this accumulation of wealth, we will keep seeing correlations without finding the causation.

The Real News Network has the interview Guilty Verdict For Occupy Activist An “Attack On Dissent”.

Attorney Kevin Zeese discusses how the judge hearing Cecily McMillan’s case did not allow the defense to show images which would have proven that the activist was reacting to getting her breast grabbed.

Compare this story to my previous post No Evidence Justice Dept. Will Prosecute U.S. Banks Responsible for Financial Crisis.

It is worth noting that Cecily McMillan was protesting that U.S. banks responsible for the financial crisis were not being prosecuted. So as is typical with much of our government’s behavior in such cases, they responded “So you want prosecutions, do you? We’ll give you your stinkin’ prosecutions.”

I don’t know what Attorney Kevin Zeese is complaining about. It is clear that whether you are rich or poor, you don’t get to present a defense in front of certain judges. Of course the rich don’t get to present their defense because the justice system is afraid to prosecute them. The poor get prosecuted for what may not be crimes, but cannot present a defense. See, same treatment, no defense.

Warning, the above paragraph may contain some sarcasm.

The Real News Network has the interview No Evidence Justice Dept. Will Prosecute U.S. Banks Responsible for Financial Crisis. This interview is with William Black who, as a bank regulator, made thousands of criminal referrals to the Justice Department during the S & L crisis.

DESVARIEUX: Alright. And what about our viewers that might be listening to this and who are so frustrated with this current situation? What could they possibly do to maybe even push this along?

BLACK: Well, demand that they bring the criminal prosecutions. That had–what–is what produced Department of Justice action in the savings and loan debacle. Now, it was helped greatly by the fact that we had tens of thousands, ultimately, of criminal referrals piling up that were not being investigated by the Justice Department. But that became a political scandal. And so we need Elizabeth Warren to make this one of her leading things that she hammers them with basically every day and to hold hearings in the Senate about the failure to reestablish the criminal referral process and to provide the Justice Department both the expertise and kick in the butt that regulators have to provide if they want to get prosecutions.

Read my previous post Holder: No banks ‘too big to jail’ to see that Elizabeth Warren was one of the first to make sure we knew that Attorney General Holder had just endorsed prosecuting big banks.

Well, we heard the call from William Black. Demand prosecution. Tell Elizabeth Warren to push harder. She is my Senator, and I will certainly do what Bill Black said. Who’s going to join me?