March 2, 2016

The Urgent Need to Save Orthodox Economists from their Crippling Myths

William K. Black
February 29, 2016 Brooklyn, N.Y.

A blogger has trolled all heterodox economists as believers in the “occult.” More precisely, he is upset about “econ people” (who are likely not economists) and who tweet him or post comments on his blog site. The blogger further complains that these commenters say that they believe in heterodox economics and “new methodologies [that] are poised to topple mainstream economics.” He then goes on to say: “My typical response is to ask what these new methodologies are. But incredibly, I can almost never get an answer.”

The UMKC economics department is chock full of heterodox economists who share the blogger’s experience. We too get weird blogs and tweets that are long on revolutionary conclusions and short on specifics. Some of these messages come from folks who say they are heterodox and some from those that write to denounce heterodox economics. We also get an endless stream of policy nostrums from orthodox economists that promise to transform America (in good ways). They have, collectively, transformed America in terrible ways.

The blogger summarizes his complaint in this paragraph.

So far, the main “heterodox” econ “schools” – Post-Keynesian, MMT, and Austrian – show every indication of having no new methodology whatsoever. Anyone who points this out will, of course, be greeted with a shower of insults from ardent followers of this “school”. But when polite, patient requests for enlightenment and information have failed enough times, what else can we conclude?

The blogger conflated “new methodology” with “heterodox.” He provides no rationale for conflating those concepts, so the entire denunciation of heterodox economics wilts upon examination. My colleagues and I use conventional research methodologies to reach predictions and policy recommendations that vary greatly from orthodox economists, and we win hands down in predictive abilities because of the soundness of our use of conventional research methodologies.

in full: http://neweconomicperspectives.org/2016/03/urgent-need-save-orthodox-economists-crippling-myths.html

February 28, 2016

Noam Chomsky Wants You to Wake Up From the American Dream

If you've just seen Michael Moore's movie and are wondering how in the world the United States got diverted into the slow lane to hell, go watch Noam Chomsky's movie. If you've just seen Noam Chomsky's movie and are wondering whether the human species is really worth saving, go see Michael Moore's movie. If you haven't seen either of these movies, please tell me that you haven't been watching presidential debates. As either of these movies would be glad to point out to you, that's NOT HOW YOU CHANGE ANYTHING.

"Filmed over four years, these are his last long-form documentary interviews," Chomsky's film, Requiem for the American Dream, says of him at the start, rather offensively. Why? He seems perfectly able to give interviews and apparently gave those in this film for four years. And of course he acquired the insights he conveys over many more years than that. They are not new insights to activists, but they would be like revelations from another world to a typical U.S. resident.

Chomsky explains how concentrated wealth creates concentrated power, which legislates further concentration of wealth, which then concentrates more power in a vicious cycle. He lists and elaborates on ten principles of the concentration of wealth and power -- principles that the wealthy of the United States have acted intensely on for 40 years or more.

1. Reduce Democracy. Chomsky finds this acted on by the very "founding fathers" of the United States, in the creation of the U.S. Senate, and in James Madison's statement during debate over the U.S. Constitution that the new government would need to protect the wealthy from too much democracy. Chomsky finds the same theme in Aristotle but with Aristotle proposing to reduce inequality, while Madison proposed to reduce democracy. The burst of activism and democracy in the United States in the 1960s scared the protectors of wealth and privilege, and Chomsky admits that he did not anticipate the strength of the backlash through which we have been suffering since.

in full: http://www.truth-out.org/opinion/item/34995-noam-chomsky-wants-you-to-wake-up-from-the-american-dream

February 27, 2016

YES! And fuck Putin.......In honor of Nemtsov may he RIP.

February 25, 2016

Clinton and Sanders' Record on Deportation and Guest Worker Policies

Activist and author David Bacon says based on Bernie's record, it is clear he would support family reunification and guest worker rights - but when it comes to Hillary, it's not so clear.

*No transcript available at this time, video 10 minutes approx.

February 25, 2016



Bio

David Bacon is an award-winning photojournalist, author, and immigrant rights activist who has spent over twenty years as a labor organizer. He is an associate editor at Pacific News Service, and writes for TruthOut, The Nation, The American Prospect, The Progressive, and the San Francisco Chronicle, among other publications. Bacon covers issues of labor, immigration and international politics. He is the author of The Children of NAFTA, Communities without Borders, Illegal People and Illegal People: How Globalization Creates Migration and Criminalizes Immigrants. His most recent book is The Right to Stay Home: How US Policy Drives Mexican Migration.

February 22, 2016

Wall Street’s Message to Young Adults: “You are Clueless”

William K. Black
February 21, 2016 Bloomington, MN

Wall Street CEOs are very upset with young adults. They believe you are “clueless” and “voting against [your] own interests” when you support Bernie Sanders. A Wall Street CEO took to the pages of the Wall Street Journal to decry the fact that “Millennials are flocking to Sanders.” It would be cruel to note that one has to be clueless to believe that writing an op ed in the WSJ was a good way to reach millennials supporting Bernie. But at least we can gain an insight into Wall Street’s theory of why Bernie is bad for young adults. It turns out that Wall Street is worried that Bernie is pushing Hillary Clinton to take inequality seriously because younger Americans take inequality seriously. Wall Street, of course, loves and exists to produce staggering inequality.

These young voters appear to be falling headlong for the Vermont senator’s plaintive narrative of economic “unfairness.” His throwaway prescriptions for redistributing income and wealth are being echoed by an increasingly nervous Mrs. Clinton—despite such policies’ having been jettisoned during her husband’s administration in the 1990s.

Notice the devastating nature of the Wall Street critique – Bernie’s discussion of inequality is “plaintive” (which means “sad” and “mournful”). Human beings are sad about the severe inequality in America – and have concluded that the Clintons’ “New Democrat” policies were a major part of the problem. Given what has happened to middle and working class Americans’ incomes under the neoliberal economic agendas of the Clintons and Bushes, the reaction of those supporting Bernie means that they are voting in favor of their economic interests. The Wall Street CEO inadvertently admits this fact, and comes to his real complaint – the public is furious that Wall Street elites made a fortune by leading the three most destructive financial fraud epidemics in history – and did so with impunity. How dare the American people no longer worship Wall Street?

Both Democrats and some Republicans keep blaming it all on “Wall Street” (Bernie Sanders’s all-purpose boogeyman) for “getting away with murder” (Donald Trump on hedge funds). Don’t they realize that the financial markets are the lubricant of the entire economy—that Wall Street’s capacity to provide liquidity and to broker capital is the lifeblood of American companies? History will probably judge the misguided post-crisis regulations like Dodd-Frank and retribution against Wall Street to have sown the seeds of the next financial crisis. For now, the vilification of Wall Street in the presidential campaign is irresponsible.

No, we don’t “realize” that Wall Street is “the lifeblood” of America. We do agree that “lubricant” comes closer – greasing politicians’ hands certainly is part of the problem. Wall Street is vastly too large and it primarily moves capital to uneconomic uses because it is led by frauds and functions largely as a parasite. Wall Street shrinks the “pie” (the overall size of the economy) and takes an astonishingly large share of that diminished pie. The author complains that “governments lack the incentives and resources to effectively allocate and manage capital in the microeconomy.” He apparently was out of town when Wall Street did exactly the same thing for exactly the same reasons – Wall Street’s executive compensation schemes create perverse incentives that Wall Street spreads throughout “Main Street.”

The Wall Street CEO admitted that his goal is to eliminate the already critically weak Dodd-Frank Act and return to an era when there was only a pretense of financial regulation. What “retributions against Wall Street” – not a single leader of the three epidemics has been prosecuted. We agree that this destruction of the rule of law on Wall Street has “sown the seeds of the next financial crisis.” Wall Street is not being vilified – its elites have acted as villains. The business model of far too much of Wall Street is fraud. The author is so desperate that he claims that Bernie wants to recreate the Soviet Union in the United States. Unsurprisingly, the author, who co-founded an “astro-turf” operation in DC purportedly dedicated to “bi-partisan” approaches ends with a partisan plea in favor of Republican candidates.

in full: http://neweconomicperspectives.org/2016/02/wall-streets-message-young-adults-clueless.html

February 22, 2016

Subprime Mortgage Whistleblowers Warn Bigger Crash on Its Way

Whistleblowers Richard Bowen and Michael Winston, along with UMKC's Bill Black, discuss the rampant fraud at Countrywide and Citigroup and how today's high foreclosure rates in states like Nevada could be a sign of what's to come

February 21, 2016

Bio

William K. Black, author of THE BEST WAY TO ROB A BANK IS TO OWN ONE, teaches economics and law at the University of Missouri Kansas City (UMKC). He was the Executive Director of the Institute for Fraud Prevention from 2005-2007. He has taught previously at the LBJ School of Public Affairs at the University of Texas at Austin and at Santa Clara University, where he was also the distinguished scholar in residence for insurance law and a visiting scholar at the Markkula Center for Applied Ethics. Black was litigation director of the Federal Home Loan Bank Board, deputy director of the FSLIC, SVP and general counsel of the Federal Home Loan Bank of San Francisco, and senior deputy chief counsel, Office of Thrift Supervision. He was deputy director of the National Commission on Financial Institution Reform, Recovery and Enforcement. Black developed the concept of "control fraud" frauds in which the CEO or head of state uses the entity as a "weapon." Control frauds cause greater financial losses than all other forms of property crime combined. He recently helped the World Bank develop anti-corruption initiatives and served as an expert for OFHEO in its enforcement action against Fannie Mae's former senior management.

Richard Bowen was a former Business Chief Underwriter for Citigroup, where he monitored the credit quality of over $90 billion annually of purchased residential mortgage loans which were put into mortgage backed securities. Beginning in 2006, he repeatedly warned management about the potential losses and ultimately warned Citi's board of directors, requesting an outside investigation. Richard testified before the SEC, with his testimony before the Financial Crisis Inquiry Commission being nationally televised. He story has been reported by all of the major media, and his 60 Minutes story, "Prosecuting Wall Street" has been re-aired eight times.

Michael Winston had a career of distinction in executive positions for over three decades in five Fortune 100 companies across three industries. He served as global head of leadership and organization strategy at Motorola, Merrill Lynch, McDonnell Douglas, Lockheed and Countrywide, and was hailed eight times by Leadership Excellence Journal as one of the "100 Most Influential Thinkers on Leadership in the World."

Pulitzer Prize winning journalist Gretchen Morgenson of the NY Times profiled Michael Winston's courage and integrity in an article entitled, "How A Whistleblower Conquered Countrywide" and Salon Magazine's David Dayen profiled Winston's story in a piece called "Wall-Street's Greatest Enemy: The Man Who Knows Too Much."
Winston authored the recently published book World-Class Performance, endorsed by key business executives, leading academics and famed Olympians. See http://worldclassperformancebook.com/

No transcript available at this time, 20 minutes approx.

February 20, 2016

Sanders' Wall Street Tax Could Raise $300 Billion A Year

Robert Pollin, who authored the Inclusive Prosperity Act, says transaction taxes are common in many capitalist countries

February 18, 2016




Bio

Robert Pollin is Distinguished Professor of Economics and Co-Director of the Political Economy Research Institute (PERI) at the University of Massachusetts-Amherst. He is also the founder and President of PEAR (Pollin Energy and Retrofits), an Amherst, MA-based green energy company operating throughout the United States.

His books include The Living Wage: Building a Fair Economy (co-authored 1998); Contours of Descent: U.S. Economic Fractures and the Landscape of Global Austerity (2003); An Employment-Targeted Economic Program for South Africa (co-authored 2007); A Measure of Fairness: The Economics of Living Wages and Minimum Wages in the United States (co-authored 2008), Back to Full Employment (2012), Green Growth (2014), Global Green Growth (2015) and Greening the Global Economy (forthcoming 2015).

He has worked recently as a consultant for the U.S. Department of Energy, the International Labour Organization, the United Nations Industrial Development Organization and numerous non-governmental organizations in several countries on various aspects of building high-employment green economies. He has also directed projects on employment creation and poverty reduction in sub-Saharan Africa for the United Nations Development Program, and has worked with many U.S. non-governmental organizations on creating living wage statutes at both the statewide and municipal levels. He is presently a member of the Scientific Advisory Committee of the European Commission project on Financialization, Economy, Society, and Sustainable Development (FESSUD). He was selected by Foreign Policy magazine as one of the "100 Leading Global Thinkers for 2013."

http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=15699

February 11, 2016

Bernie Sanders endorsed Jessie Jackson for President of the United States:

**The establishment was never a Bernie fan, why would they? We're fans of the establishment now? lol
Is that's what happened and no one told me?

snip:
Sanders did show up at the Burlington caucus that April, awkward as it was, and he delivered a spirited endorsement speech casting Jackson's candidacy in decidedly Sanders-like terms.

"Tonight we are here to endorse the candidate who is saying loud and clear that enough is enough, that it's time that this nation was returned to the real people of America, the vast majority of us, and that power no longer should rest solely with a handful of banks and corporations who presently dominate the economic and political life of this nation," he declared. "It is not acceptable to him, to me, or to most Americans, that 10 percent of the population of this nation is able to own 83 percent of the wealth, and the other 90 percent of us share 17 percent of the wealth."

Sanders received an icy reception at the caucus from some Democrats, who stood up and turned their back to the stage during his address. "And when I returned to my seat, a woman in the audience slapped me across the face," Sanders recalled in his 1998 book, Outsider in the House. "It was an exciting evening."

Jackson went on to win the Vermont caucus, one of his handful of victories outside the South. If there was a lesson in the Jackson campaign for Sanders, it was "realizing he didn't always really need to be in opposition to the Democrats," says Greg Guma, a Burlington progressive activist who joined Sanders in supporting Jackson. In essence, Sanders had formed his first political alliance—one he would continue in 1990 when he won his first congressional election with Democratic endorsements. After that, he began huddling with Democrats on Capitol Hill, and he formed the House Progressive Caucus, which included mostly Democrats. "Bernie is viewed always as an idealist," Guma notes. "But at the same time you have to recognize that this is a fairly pragmatic politician that will drive his agenda forward, and he makes alliances based on this practical calculation."

Throughout the 1988 campaign, Sanders maintained that Jackson would have been better off running as a third-party candidate. And he told Mother Jones in 1989 that the time was right for a new lefty party to challenge Democrats, as he had done in Burlington. But Sanders had no regrets about his endorsement. When Sanders arrived in Washington as a first-term congressman-elect, Jackson—along with Ralph Nader—hosted a "welcome to DC" event for him at Eastern Market. A grungy looking band played "This Land Is Your Land," as balloons fell from the rafters.

http://www.motherjones.com/politics/2015/12/bernie-sanders-jesse-jackson-campaign

February 6, 2016

Interest in New Chomsky Documentary Has Grown So Large Even the NY Times Ran a Review and Praised It

February 4, 2016

Full title: Interest in New Noam Chomsky Documentary Has Grown So Large That Even the NY Times Ran a Review—and Praised It!

In the new documentary Requiem for the American Dream, produced and directed by Peter Hutchison, Kelly Nyks and Jared P. Scott, Noam Chomsky argues that the collapse of American democratic ideals and the rise of the 1% means that the American dream is harder than ever to achieve. And unlike during the Great Depression, there seems to be no end in sight to this class struggle.

“The effect of the concentration of wealth is to yield concentration of power. [Therefore] the very fact of inequality has a corrosive, harmful effect on democracy," Chomsky states.

Chomsky was raised in an American middle-class immigrant family in the 1930s. Filmmakers use interviews with Chomsky and archival video from the 1950s onward to illustrate the golden age of American history, as Chomsky calls it. The average worker was able to buy a home, a car and live a life of relative comfort. Upward class mobility was not only aspirational, but achievable.

The widening wage gap, he claims, is "a result of over 30 years of a shift in social and economic policy, completely against the will of the population.” Today, young families are slightly wealthier than their parents were three decades ago, according to a recent BMO Economics Report. However, millennials need to pay more to get their foot in the door and are accumulating debt loads about 260% higher than their parents did at their age.

"It goes back to the founding of the country. If you read the debates at the Constitutional Convention, James Madison, the main framer, said the major concern of society has to be to protect the minority of the opulent against the majority," Chomsky says.

http://www.alternet.org/video/no-end-site-growing-wealth-inequality-according-chomsky-new-film

February 4, 2016

Sanders vs. Clinton on Wall St. Reform

Bio

William K. Black, author of The Best Way to Rob a Bank is to Own One, teaches economics and law at the University of Missouri Kansas City (UMKC). He was the Executive Director of the Institute for Fraud Prevention from 2005-2007. He has taught previously at the LBJ School of Public Affairs at the University of Texas at Austin and at Santa Clara University, where he was also the distinguished scholar in residence for insurance law and a visiting scholar at the Markkula Center for Applied Ethics.

Black was litigation director of the Federal Home Loan Bank Board, deputy director of the FSLIC, SVP and general counsel of the Federal Home Loan Bank of San Francisco, and senior deputy chief counsel, Office of Thrift Supervision. He was deputy director of the National Commission on Financial Institution Reform, Recovery and Enforcement.

Black developed the concept of "control fraud" frauds in which the CEO or head of state uses the entity as a "weapon." Control frauds cause greater financial losses than all other forms of property crime combined. He recently helped the World Bank develop anti-corruption initiatives and served as an expert for OFHEO in its enforcement action against Fannie Mae's former senior management.

Mike Konczal is a Fellow with the Roosevelt Institute, works on financial reform, structural unemployment, consumer access to financial services, and inequality. He blogs for New Deal 2.0 and the Rortybomb, and his work has appeared at The Atlantic Monthly's Business Channel, NPR's Planet Money, the Baseline Scenario, Huffington Post, and The Nation. He was formerly a financial engineer and mathematical analyst. Konczal holds a MS in Finance and a BS in Mathematics from the University of Illinois at Urbana-Champaign.

http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=15580