Monthly Archives: November 2013

Are they at it again? has an article about the latest new idea of the financial industry, securitization of bundled rental payments on previously foreclosed housing. It’s become big business, the latest flavor of the month in our wonderful financial industry with participation by all the familiar names, the ones that got us into the great recession. It all sounds eerily familiar. When queried about the potential dangers of the idea, one of its participants replied, “trust us.”

TomDispatch is a web site operated by Tom Engelhardt which he describes as an antidote to the mainstream media. The article, by journalist Laura Gottesdiener, is preceded by a brief introduction by Engelhardt.

More on the Pope

The NY Times still hasn’t noticed the Pope’s commentary on conservative economic doctrine and I sent a complaint to the Public Editor about that. Others have noticed, however, and a good summary is found on The Week. This notes that, although very liberal on economic policy, he is not on the liberal side on such issues as abortion, contraception, and women as priests.

Incidentally, if you search for articles about Pope Francis on the NY Times web site, the first thing that shows up is a link to a sponsored ultra-conservative web site that refers to him as Anti-Pope Francis. I certainly will be surprised if his views on economics have much influence on conservatives. Catholics, in particular, seem to have developed considerable skill in ignoring church views they don’t agree with.

Another View of the Pope’s Exhortation

In my last blog I noted the difference between he NY Times description of Pope Francis’ new treatise and that of Reuters. Now we also have the view of the Washington Post. Here’s their take, including an extremely newsworthy direct quote that both tthe times and Reuters missed.

Using sharply worded phrases, Francis decried an “idolatry of money” and warned it would lead to “a new tyranny.” And he invoked language with particular resonance in the United States, attacking an economic theory that discourages taxation and regulation and which most affiliate with conservatives.

“Some people continue to defend trickle-down theories which assume that economic growth, encouraged by a free market, will inevitably succeed in bringing about greater justice and inclusiveness in the world,” Francis wrote in the papal statement. “This opinion, which has never been confirmed by the facts, expresses a crude and naive trust in the goodness of those wielding economic power and in the sacralized workings of the prevailing economic system.”

“Meanwhile,” he added, “the excluded are still waiting.”

While Francis has raised concerns before about the growing gap between the wealthy and poor since becoming pontiff in March, his direct reference to “trickle-down” economic theory in the English translation of his 50,000-word statement was striking.

That’s a direct attack on conventional conservative economic theory! I particularly like the use of the term “sacralized” to describe conservative worship of the market economy.

Check Before You Give

A lot of us put off charitable giving to the end of the year and do it then so we can take the charitable deduction on our income tax return. Just make sure the recipients of your largesse are deserving.

This is pointed up by an op-ed in the NY Times today that describes a fake charity supposedly to benefit Navy veterans. Almost all the $100 million raised stayed, legally, in the hands of for-profit telemarketers! At least one routinely pocketed 90% of all donations.The organizer-in-chief was convicted of felonies, but only because he made mistakes.

I know of two web sites to check on prospective grantees and I recommend you use them. and

A Pope To Listen To

A Reuters article, quoted in the NY Times today, gives a summary of an “Apostolic Exhortation” by Pope Francis. Here’s an excerpt:

Pope Francis attacked unfettered capitalism as “a new tyranny” and beseeched global leaders to fight poverty and growing inequality, in a document on Tuesday setting out a platform for his papacy and calling for a renewal of the Catholic Church.

The 84-page document, known as an apostolic exhortation, was the first major work he has authored alone as pope and makes official many views he has aired in sermons and remarks since he became the first non-European pontiff in 1,300 years in March.

In it, Francis went further than previous comments criticizing the global economic system, attacking the “idolatry of money”, and urged politicians to “attack the structural causes of inequality” and strive to provide work, healthcare and education to all citizens.

He also called on rich people to share their wealth. “Just as the commandment ‘Thou shalt not kill’ sets a clear limit in order to safeguard the value of human life, today we also have to say ‘thou shalt not’ to an economy of exclusion and inequality. Such an economy kills,” Francis wrote in the document issued on Tuesday.

You can find the Reuters article here, or the entire 84 page “exhortation” here.

PS: The Reuters article I quoted above appeared on the NY Times web site about 6 AM today. About 12:30 it disappeared and was replaced by an article by a regular Times Vatican correspondent. Remarkably, one would think the two were talking about two different papal documents. In the latest there is no mention of market economies, inequality, or other words that might antagonize the monied class. Instead there’s pabulum. Evidently the Grey Lady doesn’t hold with spade calling.





Counter the Koch Brothers!

In a blog I posted yesterday I pointed out that the crucial political problem in the US is the extraordinary impact of big money in our governmental processes. This is nowhere more  evident than in the election process. Here is part of an email I got yesterday from the Democratic Senatorial Campaign Committee.

Now that Democrats have acted to limit the filibuster, it’s even more critical that we stop Republicans from taking over the Senate. The GOP is already threatening to SLASH abortion rights, gut environmental protections, and reverse health reform if we let them take control.

And with the stakes raised, the Koch brothers just spent over $3 million to attack Democrats in three MUST-WIN Senate races, increasing the odds of a Republican Senate takeover. Here are some of the most recent polls from key battlegrounds:

Arkansas: Mark Pryor (D) 36 – Tom Cotton (R) 37
Colorado: Mark Udall (D) 45 – Ken Buck (R) 42
Michigan: Gary Peters (D) 37 – Terri Lynn Land (R) 36

If we aren’t able to respond to the Kochs’ attacks, our chances to stop a Republican Senate takeover will be doomed. We need to raise $250,000 from grassroots donors by midnight Wednesday to fund our response plan. Will you help us today?

It’s easy to talk about campaign finance reform but that  isn’t going to happen soon. In the meantime we have to fight fire with fire. Here is the website of the DSCC. You can contribute there.

Bach and Balanchine

In the late 40s and early 50ss I was fascinated by George Balanchine’s New York City Ballet and would drive to the city to see them at City Center. One time they did Balanchine’s Concerto Barrocco, set to Bach’s Double Violin Concerto. Two violinists played on stage, accompanied by the superb orchestra, while the ballet chorus danced in the simplest of costumes.  I was bowled over by it. Here’s a little bit of it from that time period.

One of the soloists, Tanaquil Le Clercq, was later struck down by polio and paralyzed. We have almost forgotten that ghastly disease, thanks to vaccines.

I had never heard the Bach concerto before and the next day I went to a record shop and bought the version with Jascha  Heifitz playing both solo parts. Thanks to Youtube, here it is.

How the free market works?

Nicholas Christoff’s column in the NY Times this morning has a good example of how the market economy works at it’s worst. (I know, it’s not always bad.)

He tells how, in the seventies, the tobacco companies fought off pressure to make cigarettes less likely to ignite fires by diverting attention to fire proofing furniture. This led to a thriving business in fire retardent chemicals for foam furniture that had only two minor flaws: they are both ineffective and carcinogenic. The sorry story will be told in an HBO documentary  Monday night and resulted from a Chicago Tribune investigation. It’s a story not only of greedy corporations but of ineffective government regulation.

The lesson I learn from  this sort of thing is that the unfettered free enterprise system is a disaster. Instead I recommend a well-fettered free enterprise system that is intelligently regulated by government. However that is difficult to accomplish when our government organs (legislative, executive, and judicial) are subject to the power of big money. It always comes back to that, doesn’t it?

Quote of the day, or the eternal conservative: The budget should be balanced, the Treasury should be refilled, public debt should be reduced, the arrogance of officialdom should be tempered and controlled, and the assistance to foreign lands should be curtailed lest Rome become bankrupt. People must again learn to work, instead of living on public assistance. – Cicero


WQXR seems to be celebrating Mozart Month or something like that. They published their list of 20 essential recordings and I was moved to comment that they shouldn’t neglect the String Quintet in G Minor. Here’s the first movement with some interesting animation to accompany it.

Most commentators call this music melancholy.  To me it’s serene. A year later Mozart wrote the magical G Minor Symphony.

No Exit?

The conventionally wise yatter on about when economic recovery will let the Fed raise interest rates and how the politicians will find the grand bargain. As though any of that really mattered.

In fact, as the NY Times told us yesterday, the search for a grand bargain is all show.

Republicans oppose further tax increases on the rich, as Democrats demand, so Democrats will not support major changes to Medicare and Social Security, as Republicans insist. But the dirty secret — a phrase used independently, and privately, by people in both parties — is that neither side wants to take the actions it demands of the other to achieve a breakthrough.

Not that this is bad since the grand bargain is supposed to solve a government budget problem far in the future, while ensuring nothing is done to provide the fiscal stimulus we urgently need to invigorate the economy.

In the meantime both Larry Summers, in a speech at an IMF conference, and Paul Krugman, in his NY Times column and also his blog, have raised a real issue that should have our attention: will there really be a recovery from our current economic slump?

But what if the world we’ve been living in for the past five years is the new normal? What if depression-like conditions are on track to persist, not for another year or two, but for decades?

You might imagine that speculations along these lines are the province of a radical fringe. And they are indeed radical; but fringe, not so much. A number of economists have been flirting with such thoughts for a while. And now they’ve moved into the mainstream. In fact, the case for “secular stagnation” — a persistent state in which a depressed economy is the norm, with episodes of full employment few and far between — was made forcefully recently at the most ultrarespectable of venues, the I.M.F.’s big annual research conference. And the person making that case was none other than Larry Summers.  And if Mr. Summers is right, everything respectable people have been saying about economic policy is wrong, and will keep being wrong for a long time.

Frankly I don’t have enough grasp of economics to understand the basis for these fears, but it rings a bell with me because of something I had noticed. It’s generally agreed that our recession followed a bubble driven by excessive consumer debt, especially in housing. Yet that time period was not one of economic boom, although unemployment was low. That raises the question of how we can recover to full employment without the demand supplied by excessive consumer debt.

And that suggests to me that a critical element in our economy is inadequate purchasing power among consumers. The reason: the incredible shift of purchasing power from the middle class to the wealthy in recent decades. Ignorant as I am, I was relieved to find that Nobel Luareate Joseph Stiglitz agrees:

. . . . . our middle class is too weak to support the consumer spending that has historically driven our economic growth. While the top 1 percent of income earners took home 93 percent of the growth in incomes in 2010, the households in the middle — who are most likely to spend their incomes rather than save them and who are, in a sense, the true job creators — have lower household incomes, adjusted for inflation, than they did in 1996. The growth in the decade before the crisis was unsustainable — it was reliant on the bottom 80 percent consuming about 110 percent of their income.

This is the biggest problem facing our country  – except for global warming. But don’t expect to hear much about it from the talking heads in Washington.