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AND NOW THE APOCALYPSE!
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[PLEASE TAKE NOTICE: All entries are in descending order by the date(s) they were posted, and in some cases in ascending order by the date(s) written.]
The American flag, the U.S. Constitution and the Bill of Rights have now been torn to shreads. "Rest In Peace (RIP)", Freedom and Liberty. RIP, "the experiment in democracy".
We have watched in dumb amazement (those of us who have realized what is really going on, that is) as for the past five years the Bill of Rights, the U.S. Constitution, liberty, and freedom have been step by step, systematically eviscerated, first with the so-called "USA P.A.T.R.I.O.T. Act (those who criticize it supposedly aren't patriots)", and then with the latest afront on domestic freedom and liberty, the "Military Commissions Act of 2006," also known among other names as the "Detainee Bill", passed by an almost completely cowed Senate in the dead of night on Friday, the 29th day of September, 2006.
Now NONE OF US is safe. Not civil libertarians, not dissenters, not protesters of even the mildest variety (as virtually everything is now considered "terrorism"), and not even those blind worshippers of the U.S. government or its agents; because, if someone decides they don't like you, or gets jealous or resentful of you, all they need do is CLAIM you criticized the government, defended "rights", felt that certain force used against someone was excessive, or committed some other equally innocent "perceived threatening conduct" (some of the federal government's favorite wording that they now use for those who exercise their inalienable, immutable, inviolable First Amendment rights of Freedom of Speech, Belief and Dissent to disagree with their government), and you will very likely be "disappeared" into custody, stripped of U.S. citizenship, and be interro(r)gated, intimidated, humiliated, terrorized, tortured, and/or very possibly murdered, all without "Due Process of Law" under the Fifth and Fourteen Amendments of the U.S. Constitution, or a fair, unbiased hearing, access to an impartial lawyer, court, judge, or jury; and, if you live through this process, you could be kept secretly imprisoned forever without access to ANYONE important to you. This is NO exageration WHATSOVER; and, if "We, The People" don't repeal this horrific law, or the U.S. Supreme court doesn't overturn it, this is the END of our Republic, of Democracy, and of ALL Liberty and Freedom in "the land of the free, and the home of the brave", and THE END OF ALL protection(s) from a capricious, out of control, dictatorial government.
So, you see, the inviolable freedoms and liberties that we have so taken for granted, and that most Americans now have so little understanding of the supreme importance of, much to our grave detriment, were not overturned by "Islamo-Fascist terrorists", nor by protesting, dissenting U.S. citizens, nor journalists critical of the government, nor any other equally illusory, contrived, manufactured, engineered, and/or U.S.-government-created, state-sponsored "enemy(ies)", agents, assets, patsies, bogeymen, infiltra(i)tors, disinfo-agents, detractors, distractors, naysayers, actors, shills, trolls, hackers, informers, spies, entrappers, and/or agents provocateur, etc., but this act of true terrorism was carried out by the very people in our own government who are literally sworn to uphold and protect the U.S. Constitution "from all enemies, foreign AND DOMESTIC", including from THEMSELVES and other tyrannical, 'absolutely despotic' (to loosely quote the Declaration of Independence) forces in that very government; and the vast majority of them have COMPLETELY failed us and thrown EVERY SINGLE PERSON in this great country OF OURS into limitless danger and threat(s) by that government to the very safety of EACH AND EVERY ONE OF OUR LIVES.
The following is very likely the best article on this subject that has thus far been written, at least as far as I am aware; and, therefore, I share it with you at this time to further clarify just how truly catastrophic, life-threatening and consequential the situation we are now in actually is for every single man, woman, child, and little baby in this entire country, and ultimately in this entire world. The world-renowned True Journalist who wrote this great article, Chris Floyd, is also a True Hero and an exceedingly courageous human being for writing such an accurate article of warning to world-citizens planet-wide, and such an accurate portrayal of the extremely dire situation the U.S. and the world are in as a direct result of the subject matter it covers, as follows:
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Read more of Chris Floyd's columns.
FATAL VISION: THE DEEPER EVIL
BEHIND THE DETAINEE BILL
("Big Brother" Government
Is Now Here In The U.S.)
By Chris Floyd, T.O. UK Reporter
t r u t h o u t | Perspective
Tuesday, 3 October 2006
[Copyright (c) 2006 in the
U.S.A. and Internationally
by t r u t h o u t (.org),
Empire Burlesque (Chris' blog)
and/or Chris Floyd.
All rights reserved.]
(This is a slightly revised version of a piece that first appeared on the Oct. 2nd edition of Truthout.org .)
There is no week nor day nor hour when tyranny may not enter upon this country -- if the people lose their confidence in themselves -- and lose their roughness and spirit of defiance.
--- Walt Whitman
I.
It was a dark hour indeed (on Friday, September 29th, 2006) when the United States Senate voted to end the constitutional republic and transform the country into a "Leader-State," giving the president and his agents the power to capture, torture and imprison forever anyone -- American citizens included -- whom they arbitrarily decide is an "enemy combatant." This also includes those who merely give "terrorism" some kind of "support," defined so vaguely that many experts say it could encompass legal advice, innocent gifts to charities or even political opposition to US government policy within its draconian strictures.
All of this is bad enough -- a sickening and cowardly surrender of liberty not seen in a major Western democracy since the Enabling Act passed by the German Reichstag in March 1933. But it is by no means the full extent of our degradation. In reality, the darkness is deeper, and more foul, than most people imagine. For in addition to the dictatorial powers of seizure and torment given by Congress on Thursday to George W. Bush -- powers he had already seized and exercised for five years anyway, even without this fig leaf of sham legality -- there is a far more sinister imperial right that Bush has claimed -- and used -- openly, without any demur or debate from Congress at all: ordering the "extrajudicial killing" of anyone on earth that he and his deputies decide -- arbitrarily, without charges, court hearing, formal evidence, or appeal -- is an "enemy combatant."
That's right; from the earliest days of the Terror War -- September 17, 2001, to be exact -- Bush has claimed the peremptory power of life and death over the entire world. If he says you're an enemy of America, you are. If he wants to imprison you and torture you, he can. And if he decides you should die, he'll kill you. This is not hyperbole, liberal paranoia, or "conspiracy theory": it's simply a fact, reported by the mainstream media, attested by senior administration figures, recorded in official government documents -- and boasted about by the president himself, in front of Congress and a national television audience.
And although the Republic-snuffing act just passed by Congress does not directly address Bush's royal prerogative of murder, it nonetheless strengthens it and enshrines it in law. For the measure sets forth clearly that the designation of an "enemy combatant" is left solely to the executive branch; neither Congress nor the courts have any say in the matter. When this new law is coupled with the existing "Executive Orders" authorizing "lethal force" against arbitrarily designated "enemy combatants," it becomes, quite literally, a license to kill -- with the seal of Congressional approval.
How arbitrary is this process by which all our lives and liberties are now governed? Dave Niewert at Orcinus has unearthed a remarkable admission of its totally capricious nature. In an December 2002 story in the Washington Post, then-Solicitor General Ted Olson described the anarchy at the heart of the process with admirable frankness:
"[There is no] requirement that the executive branch spell out its criteria for determining who qualifies as an enemy combatant," Olson argues.
"'There won't be 10 rules that trigger this or 10 rules that end this,' Olson said in the interview. 'There will be judgments and instincts and evaluations and implementations that have to be made by the executive that are probably going to be different from day to day, depending on the circumstances.'"
In other words, what is safe to do or say today might imperil your freedom or your life tomorrow. You can never know if you are on the right side of the law, because the "law" is merely the whim of the Leader and his minions: their "instincts" determine your guilt or innocence, and these flutterings in the gut can change from day to day. This radical uncertainty is the very essence of despotism -- and it is now, formally and officially, the guiding principle of the United States government.
And underlying this edifice of tyranny is the prerogative of presidential murder. Perhaps the enormity of this monstrous perversion of law and morality has kept it from being fully comprehended. It sounds unbelievable to most people: a president ordering hits like a Mafia don? But that is our reality, and has been for five years. To overcome what seems to be a widespread cognitive dissonance over this concept, we need only examine the record -- a record, by the way, taken entirely from publicly available sources in the mass media. There's nothing secret or contentious about it, nothing that any ordinary citizen could not know -- if they choose to know it.
II.
Six days after the 9/11 attacks, George W. Bush signed a "presidential finding" authorizing the CIA to kill those individuals whom he had marked for death as terrorists. This in itself was not an entirely radical innovation; Bill Clinton's White House legal team had drawn up memos asserting the president's right to issue "an order to kill an individual enemy of the United States in self-defense," despite the legal prohibitions against assassination, the Washington Post reported in October 2001. The Clinton team based this ruling on the "inherent powers" of the "Commander in Chief" -- that mythical, ever-elastic construct that Bush has evoked over and over to defend his own unconstitutional usurpations.
The practice of "targeted killing" was apparently never used by Clinton, however; despite the pro-assassination memos, Clinton followed the traditional presidential practice of bombing the hell out of a bunch of civilians whenever he wanted to lash out at some recalcitrant leader or international outlaw -- as in his bombing of the Sudanese pharmaceutical factory in 1998, or the two massive strikes he launched against Iraq in 1993 and 1998, or indeed the death and ruin that was deliberately inflicted on civilian infrastructure in Serbia during that nation's collective punishment for the crimes of Slobodan Milosevic. Here, was following the example set by George H.W. Bush, who killed hundreds, perhaps thousands, of Panamanian civilians in his illegal arrest of Manuel Noriega in 1988, and Ronald Reagan, who killed Moamar Gadafy's adopted 2-year-old daughter and 100 other civilians in a punitive strike on Libya in 1986.
Junior Bush, of course, was about to outdo all those blunderbuss strokes with his massive air attacks on Afghanistan, which killed thousands of civilians, and the later orgy of death and destruction in Iraq. But he also wanted the power to kill individuals at will. At first, the assassination program was restricted to direct orders from the president aimed at specific targets, as suggested by the Clinton memos. But soon the arbitrary power of life and death was delegated to agents in the field, after Bush signed orders allowing CIA assassins to kill targets without seeking presidential approval for each attack, the Washington Post reported in December 2002. Nor was it necessary any longer for the president to approve each new name added to the target list; the "security organs" could designate "enemy combatants" and kill them as they saw fit. However, Bush was always keen to get the details about the agency's wetwork, administration officials assured the Post.
The first officially confirmed use of this power was the killing of an American citizen, along with several foreign nationals, by a CIA drone missile in Yemen on November 3, 2002. A similar strike occurred on December 4, 2005, when a CIA missile destroyed a house and purportedly killed Abu Hamza Rabia, a suspected al-Qaeda figure. But the only bodies found at the site were those of two children, the houseowner's son and nephew, Reuters reports. The grieving father denied any connection to terrorism. An earlier CIA strike on another house missed Rabia but killed his wife and children, Pakistani officials reported.
However, there is simply no way of knowing at this point how many people have been killed by American agents operating outside all judicial process. Most of the assassinations are carried out in secret: quietly, professionally. As a Pentagon document uncovered by the New Yorker in December 2002 revealed, the death squads must be "small and agile," and "able to operate clandestinely, using a full range of official and non-official cover arrangements to ... enter countries surreptitiously."
What's more, there are strong indications that the Bush administration has outsourced some of the contracts to outside operators. In the original Post story about the assassinations -- in those first heady weeks after 9/11, when administration officials were much more open about "going to the dark side," as Cheney boasted on national television -- Bush insiders told the paper that "it is also possible that the instrument of targeted killings will be foreign agents, the CIA's term for nonemployees who act on its behalf.
Here we find a deadly echo of the "rendition" program that has sent so many captives to torture pits in Syria, Egypt and elsewhere -- including many whose innocence has been officially established, such as the Canadian businessman Maher Arar, German national Khalid El-Masri, UK native Mozzam Begg and many others. They had been subjected to imprisonment and torture despite their innocence, because of intelligence "mistakes." How many have fallen victim to Bush's hit squads on similar shaky grounds?
So here we are. Congress has just entrenched the principle of Bush's "unitary executive" dictatorship into law; and it is this principle that undergirds the assassination program. As I wrote in December, it's hard to believe that any genuine democracy would accept a claim by its leader that he could have anyone killed simply by labeling them an "enemy." It's hard to believe that any adult with even the slightest knowledge of history or human nature could countenance such unlimited, arbitrary power, knowing the evil it is bound to produce. Yet this is exactly what the great and good in America have done.
But this should come as no surprise. They have known about it all along, and have not only countenanced Bush's death squad, but even celebrated it. I'll end with one more passage from that December article, which sadly is even more apt for our degraded reality today. It was a depiction of the one of the most revolting scenes in recent American history: Bush's state of the Union address in January 2003, delivered live to the nation during the final warmongering frenzy before the rape of Iraq:
Trumpeting his successes in the Terror War, Bush claimed that "more than 3,000 suspected terrorists" had been arrested worldwide -- "and many others have met a different fate." His face then took on the characteristic leer, the strange, sickly half-smile it acquires whenever he speaks of killing people: "Let's put it this way. They are no longer a problem."
In other words, the suspects -- and even Bush acknowledged they were only suspects -- had been murdered. Lynched. Killed by agents operating unsupervised in that shadow world where intelligence, terrorism, politics, finance and organized crime meld together in one amorphous, impenetrable mass. Killed on the word of a dubious informer, perhaps: a tortured captive willing to say anything to end his torment, a business rival, a personal foe, a bureaucrat looking to impress his superiors, a paid snitch in need of cash, a zealous crank pursuing ethnic, tribal or religious hatreds -- or any other purveyor of the garbage data that is coin of the realm in the shadow world.
Bush proudly held up this hideous system as an example of what he called "the meaning of American justice." And the assembled legislators ... applauded. Oh, how they applauded! They roared with glee at the leering little man's bloodthirsty, B-movie machismo. They shared his sneering contempt for law -- our only shield, however imperfect, against the blind, brute, ignorant, ape-like force of raw power. Not a single voice among them was raised in protest against this tyrannical machtpolitik: not that night, not the next day, not ever.
And now, in September 2006, we know they will never raise that protest. Oh, a few Democrats stood up at the last minute on Thursday to posture nobly about the dangers of the detainee bill -- but only when they knew that it was certain to pass, when they had already given up their one weapon against it, the filibuster, in exchange for permission from their Republican masters to offer amendments that they also knew would fail. Had they been offering such speeches since October 2001, when the lineaments of Bush's presidential tyranny were already clear -- or at any other point during the systematic dismantling of America's liberties over the past five years -- these fine words might have had some effect.
Now the killing will go on. The tyranny that has entered upon the country will grow stronger, more brazen; the darkness will deepen. Whitman, thou should'st be living at this hour; America has need of thee. (Subtitle and/or emphasis added by Wolf Britain.)
Chris Floyd is an American journalist residing in the UK. His work has appeared in print and online in venues all over the world, including The Nation, Counterpunch, Columbia Journalism Review, the Christian Science Monitor, Il Manifesto, the Moscow Times, and many others. He is the author of Empire Burlesque: High Crimes and Low Comedy in the Bush Imperium
________
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By Fred W. Baker III
American Forces Press Service
Jan. 31, 2008 - A Congressional commission today recommended sweeping changes to the way U.S. military reserve forces have been structured and have operated for more than a half century. The Commission on the National Guard and Reserves delivered to Congress and Pentagon officials its final report, which includes 95 recommendations on how to transition the reserves into a feasible and sustainable operational reserve.
Today's reserve components were designed as a strategic reserve during the Cold War era. "The Guard was part of that surge force that would be dusted off once in a lifetime," commission chairman retired Marine Maj. Gen. Arnold Punaro said today. "That is absolutely not the situation we have today."
Nearly 100,000 reserve troops are on active duty, according to DoD reports. In 2006, reserves forces provided 61 million "man days," or single days of duty, in support of the Defense Department.
It would not be feasible to add an equivalent number of forces to active duty, Punaro said in a news conference at the National Press Club. He called increasing active forces so significantly an "economically unaffordable option" that would cost "a trillion dollars."
Right now, for about nine percent of the DoD budget, the National Guard and reserves provide 44 percent of manpower available to the Defense Department, Punaro said. "You've got high quality. You've got great reliability and dependability. You've got significant affordability and availability," he said.
Six conclusions serve as the foundation for the 400-page report, which is based on 163 findings, 17 days of public hearings, testimony of 115 officials witness and 800 interviews and site visits by commission members. It is the most comprehensive, independent review of the Guard and reserves in 60 years, Punaro said.
The commission proposed changes in laws and regulations that govern the reserves, as well as how reserve forces train, equip and approach medical readiness. The commission proposed an "integrated continuum of service" between reserve and active forces, offering the same pay, personnel, promotion and retirement systems.
The changes would allow a seamless transition by servicemembers over the course of a military career to transition from active to reserve, and to even leave the service temporarily for child rearing or to pursue higher education.
Now, when reservists move from one duty status, such as from active duty to state duty, they sometimes face pay problems and delays. The commission recommended moving from the current 29 duty statuses to only two: active duty or not.
For health care, a hot-ticket item for activated reservists, the commission proposed more specific, targeted information geared to reservists and their families. Many of those the commission interviewed expressed frustration with trying to understand the medical healthcare system quickly once their spouses were mobilized, commission members said.
In personnel changes, the commission recommended a competency-based promotion system that recognizes civilian skills and recruits and retains accordingly.
Many of the changes could be implemented this year if supported by Congress and DoD, Punaro said. Some, though, could require years to debate and implement.
The commission also called for better support programs, funding and resourcing for families and defense officials to have an open dialogue with employers who suffer when employees depart on multiple employments. It also recommends expanding the role of the National Committee for Employer Support of the Guard and Reserve, which advocates on the behalf of servicemembers.
"During the past few years, DoD has initiated the largest set of changes in policy and statute since the inception of the all-volunteer force. This is transforming the Guard and Reserve from a purely strategic reserve to a sustainable operational and strategic reserve," Thomas F. Hall, assistant secretary of defense for reserve affairs, said today.
Defense Department officials said they are reviewing the report.
"We thank the Commission on the National Guard and Reserves for their diligence in preparing this important report," Hall said. "We look forward to reviewing the entire document put forward by the commission and will carefully study the feasibility of each proposal contained within their report."
White House Admits No Back-Up Tapes for E-mail Before October 2003
Responds to Court's Questions; Claims Not to Know Whether Critical E-mails Were Erased
Despite Previously Acknowledging That as Many as 5 Million E-mails are Missing, White House Now Tells a Different Story
For more information contact:
Meredith Fuchs/Tom Blanton [National Security Archive] - 202/994-7000 John B. Williams/Sheila L. Shadmand [Jones Day] - 202/879-3939
http://www.nsarchive.org
Washington DC, January 16, 2008 - In response to a federal court order issued last week, the White House late last night refused to acknowledge any missing e-mails, instead stating that it "has undertaken an independent effort to determine whether there may be anomalies in Exchange e-mail counts" during the 2003-2005 period. A sworn statement by the Chief Information Officer of the White House Office of Administration filed with U.S. federal court just before midnight admitted the White House had recycled its e-mail back-up tapes before October 2003 and only began retaining the back-ups starting at that point.
"It strikes me as odd that they recognized a problem and changed their practice in 2003 to start saving the backups, but four-and-a-half years later they still have not yet figured out whether or what e-mails were deleted," commented Meredith Fuchs, the Archive's General Counsel. "It also is troubling that the problem may have started before October 2003, and they acknowledge that back-ups prior to that period were recycled and are gone."
"Two years after a special prosecutor concluded that key e-mails were missing from the White House system administered by the Office of Administration, the White House astonishingly now admits it has no back-up tapes from before October 2003 and doesn't know if any e-mails are missing," said Tom Blanton, director of the National Security Archive.
The loss of White House e-mails first surfaced on January 23, 2006, when prosecutors in the Scooter Libby matter informed Mr. Libby's defense counsel that they were unable to provide copies of e-mail records "because not all email records from the Office of the Vice President and the Executive Office of President for certain time periods in 2003 was preserved through the normal archiving process on the White House computer system." The full scope of the problem was not appreciated until April 2007, when Citizens for Responsibility and Ethics in Washington (CREW) issued a report stating that over 5 million e-mails were missing throughout the Executive Office of the President. At that time, White House spokesperson Dana Perino acknowledged the lost e-mails.
Sheila L. Shadmand, counsel for the Archive, commented: "It is a victory to finally get the White House to respond to the Archive’s claims, but somehow I suspect we will have many battles ahead of us to preserve the documentary history of the government for the American public."
"This declaration may mean that records about policy and decisions in the Executive Office of the President are not entirely lost, but in many respects it raises more questions. We still do not know what was lost, why it was lost, and what steps we have to take to recover it--assuming it is still recoverable," explained Ms. Fuchs.
On January 8, Magistrate Judge Facciola of the U.S. District Court for the District of Columbia ordered the White House to answer a series of questions about the missing e-mails, asserting that the information was "time-sensitive" because any back-ups of the missing e-mails "are increasingly likely to be deleted or overridden with the passage of time." Judge Kennedy had previously ordered the preservation of e-mail back-up tapes held by the Executive Office of the President (EOP) in the consolidated lawsuits filed by the National Security Archive and Citizens for Responsibility and Ethics in Washington (CREW).
Visit the Web site of the National Security Archive for more information about today's posting.
People are rightly warned not to take what they read on the Internet at face value. A good warning but hardly sufficient. Anyone who has regularly read academic journals and attended academic conferences knows that peer review is hardly foolproof. Publishers with hoards of editors publish junk books, and newspaper editors and columnists disseminate propaganda. So the only authority anyone can appeal to is a good mind highly schooled in the techniques of critical reading. Even people with eminent reputations often publish junk but are rarely upbraided. (Eminence has its protections and deference, its rewards.)
Recently I came across citations to an article written by Martin Feldstein (Why is the Dollar so High?), and since the summaries I read did not ring true to me, I sought out the article itself. Unfortunately the final version, published in the Journal of Policy Modeling, is available only for a fee, I had to settle for a working draft (http://www.nber.org/papers/w13114), but since the parts summarized seem to be intact, I assume the draft does not differ much from the final version. The working draft, however, is so sophomoric that even as an exercise in composition, it would not have passed muster in any composition class I ever took, and since sloppy writing is usually the result of sloppy thinking, I have serious concerns about how it came to be published and why others cite it.
Although I do not intend to concentrate on the article’s compositional shortcomings, its organization is a literal nightmare made up of loosely related topics that seem to have popped into Mr. Feldstein’s head in no logical sequence, it contains elementary grammatical errors, misstatements, and a conclusion quite different from what one would expect from its title. He writes, for instance, “if the dollar were to fall before the saving rate declined, the level of aggregate demand in the U.S. would rise” which contains a sequence of tense error, a case error, and a misstatement. Surely what he is trying to say is this: If the dollar’s value were to fall before the savings rate increases, the level of aggregate demand in the U.S. would rise.
The conclusion, however, is more revealing. He writes, “The best hope for a smooth adjustment of both the global and U.S. imbalances would be a substantial fall of the dollar followed by a significant rise in the U.S. saving [sic] rate and a policy of fiscal stimulus in other countries. Achieving this will require both good policies and good luck.” Given this conclusion, one would expect a title somewhat like, “Smoothly Adjusting Global and U.S. Imbalances,” and a discussion of why Mr. Feldstein believes that to be unlikely. But although there is some discussion in the article’s body that relates to this conclusion, the article’s actual title leads one to look for something else. ‘Nuff said.
Mr. Feldstein’s argument for why the dollar is so high goes like this: “The basic national income accounting identity tells us that investment minus saving equals imports minus exports. If saving is low relative to the investment . . . we must have a trade deficit to bring in the resources to fill the gap. This line of reasoning leads us to the low level of the U.S. saving rate as the primary cause of the high level of the dollar.”
All this comes down to is a mere equation—investment (I) minus saving (S) equals imports (M) minus exports (E). A mere equation, however, doesn’t rise to the level of “reasoning.” But seeing what Mr. Feldstein is getting at is easy. Merely put some numbers into the equation. If one does, whenever S = I the equation’s value is zero. When S > I, E > M, and when S < I, M > E. How this leads to a conclusion about the dollar’s value, however, is a mystery, since there is no term in the equation for dollars or their value.
Mr. Feldstein’s mistake, however, is drawing any conclusion at all from this equation. He admits that the equation is merely an accounting identity. He also admits this: “Although . . . individuals might have regarded . . . spending as a form of investment, these outlays are treated as consumption in . . . national income accounts.”
So what? How does this accounting convention relate to anything real? For instance, the FED, I have read, relies on core CPI because it is thought to be a better predictor of future inflation than the real CPI. But core CPI doesn’t relate to anything real in terms of household management, where food and fuel are major, required expenditures. So Mr. Feldstein’s stated conclusion is a non sequitur. The only valid conclusion is this: in terms of accounting conventions, when S is small in relation to I, M is large.
Any inference drawn from this equation is perplexing. Equations don’t have gaps. So what does Mr. Feldstein mean by “the gap”? From his conclusion, I assume he means the difference between investment and savings that makes up the left side of the equation. But the right side of the equation contains the same gap. In fact, the gap on the left side is identical to the gap on the right side; otherwise, the two sides would not be equal. So if Mr. Feldstein can infer that the gap on the left side means that the low savings rate is the cause of the high value of the dollar, why can’t we equally infer from the gap on the right side that the low level of exports is the cause of the high value of the dollar? Why would Mr. Feldstein ignore the right side and make his inference from only the left side?
I suspect Mr. Feldstein, as many orthodox economists, harbors a bias. These people are inherently anti-consumer and pro-business. It is ordinary household savings that Mr. Feldstein says is low, so the ordinary householder is to blame for not being more frugal. But if one draws the inference from the right side, it is manufacturers who are the blame for making products that foreigners don’t want to buy or for not making products that American consumers must buy. To these economists, it’s always the people but never the system that is to blame, which is pure bias.
He then writes that, “Two primary forces have been driving down the household saving [sic] rate: increasing wealth and . . . mortgage refinancing. . . . Individuals who are saving for retirement can rightly conclude that, because of these wealth increases, they can afford to save less. And retirees who are dissaving can look at their wealth and conclude that they can afford to dissave relatively more than previous generations of retirees. This has progressed to a point where the depressed saving of the savers and the increases [sic] dissaving of the dissavers has caused the net saving [sic] rate to be negative.”
Well, yes, individuals could have drawn these conclusions, but how can anyone know that they did? And by what system of logic can one derive as indicative statement from two modal statements? No logician would say that that’s possible.
And how could Mr. Feldstein have neglected the loose lending policies of bankers who literally pushed revolving credit cards into the hands of consumers, whose loans were too easy to get and almost impossible to repay? Surely credit cards have played a large role in the spending habits of Americans, perhaps even a greater role than wealth drawn from investments in the market and home refinancing. Did this banking policy play no role? Did Mr. Feldstein ignore it because it is a business practice, not a consumer practice?
Anyhow, talk about saving money is America is difficult to make any sense of. The word “save” has a precise meaning. It means to protect something from danger of loss, injury, or destruction. A grandmother can save her wedding dress so her granddaughter can wear it on her wedding day, but a dollar cannot be saved. No conditions exist in America in which a dollar can be put away and protected from the danger of loss. So Americans can’t properly save, but they are told that they save almost every time they buy. They are to told to put money away for a needy day by investing in (insecure) securities. They are also told that a home is the largest investment that most people make. They are never told, however, that the market is one giant casino, and that so called investing is really wagering. But if proper saving is impossible, what becomes of the basic national income accounting identity Mr. Feldstein bases his conclusion on? One of the terms in the equation’s left side disappears, and when it disappears, so does the so-called gap. Of course, this result is merely semantical, but it does show the inappropriateness of using an equation created for a special purpose to draw a conclusion unrelated to that purpose.
Mr. Feldstein also writes, ”The household saving [sic] rate will rise because the two primary forces that have driven savings down will come to an end. First, the sharp rise in wealth caused by abnormal gains in share prices and house prices will not continue. Home prices are already beginning to decline and the prices of stocks are not likely to outperform earnings in the future in the way that they did in the past.”
But how can these lead to a rise in savings? Wages have been stagnant in this century, and if stocks are “not likely to outperform earnings in the future,” people will be poorer and less able to borrow for consumption because of the decline in home prices. Where do the increased savings come from, especially if consumers are forced to buy imported clothing, oil, and other necessities at higher prices as the value of the dollar drops? Poorer people can not increase their financial assets unless incomes remain constant or grow and the prices of the imported items needed decrease. Given the decline in the dollar’s value, the latter is not likely to happen and there is no reason to believe the former will either.
As absurd as all of this is; however, the worst is yet to come.
Mr. Feldstein writes, “households and businesses . . . must be given an incentive to spend more on American made goods and services and less on the goods and services made elsewhere. . . . The way in which this will come about is a decline in the value of the dollar. . . . When the dollar declines . . . American goods are cheaper relative to European goods. That makes American households and businesses buy less in Europe and more in America. And the same happens in reverse for European buyers. . . . It is common to hear . . . that the U.S. no longer has the ability to manufacture and export. Or . . . that we will never be able to compete with the low labor costs that drive imports. . . . Both of these worries are unfounded. The U.S. is a major exporter. . . . Caterpillar tractors compete with the Komatsu tractors made in Japan. Boeing airplanes compete with European airbus planes. California wine competes with wine from France, Italy and Spain. . . . But what about the goods that come from countries in which [wages] [sic] are very low? It is certainly true that . . . [w]e will not see American factories making the products now produced in very low cost . . . countries. But instead of substituting American made goods for very similar imports, . . . American consumers . . . will shift to buying U.S. goods and services. . . . For example, as imported t-shirts and sneakers become more expensive, American consumers will spend more on meals away from home and on travel in the United States.”
Well, I don’t know how many Americans will buy Boeing 747s and Caterpillar tractors, but Mr. Feldstein and his fellow orthodox economists may very well drive us all to drink. And those meals away from home and travel in the United States will be taken bare footed and shirtless, I presume. Since even McDonalds has a sign saying “No shoes, no shirt, no service,” will we all be taking our meals away from home at truck stops?
These examples are so ludicrous that no competent thinker or writer would have included them in an essay, the purpose of which is to produce conviction, since these examples are not convincing. As a matter of fact, if they are the best Mr. Feldstein can come up with, he must certainly be wrong.
I have been hard on Mr. Feldstein, but not nearly as hard as I could have been, given the vast number of compositional and logical errors in his paper. Continuing to flog this dog will not add anything to what has already been demonstrated.
It is difficult to understand how a person with Mr. Feldstein’s reputation could have had the temerity to exhibit this junk publicly. Given his positions as George F. Baker Professor of Economics at Harvard University, and president and CEO of the National Bureau of Economic Research (NBER), this article should be an embarrassment. Given his past association with the Reagan administration, I suspect very strongly that Mr. Feldstein is not and never has been an objective researcher and thinker, that he, like many orthodox economists, is and always has been a mere ideologue. Reagan once remarked that he studied economics in college but that “it didn’t take.” He was an easy mark for economists like Mr. Feldstein and Arthur Laffer who helped kick this economy into the freefall it is now going through.
There is one sure test that separates ideologues from objective thinkers and researchers—how they respond to criticism. Ideologies, by definition, never have rational foundations; they are belief systems. Ideologues cannot react to criticism with rational argument; to do so would be to commit intellectual suicide. So when faced with criticism, ideologues merely ignore it or attack the critic with an ad hominem ”You just don’t understand.” In that way, they can never be refuted even though they can never demonstrate their case. So they continue to publish the same, tiresome old stuff. And given Mr. Feldstein’s prominence, that’s scary. Do people really take the stuff that comes out of the National Bureau of Economic Research seriously, or do they consider it just another one of the stink-tanks from which America reeks?
©2007 John Kozy
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