OK So Freedom Is Not Free, The Conservative Economics Movement Has Bought It

OK So Freedom Is Not Free, The Conservative Economics Movement Has Bought It

Giant bank holding companies now own airports, toll roads, and ports; control power plants; and store and hoard vast quantities of commodities of all sorts. They are systematically buying up or gaining control of the essential lifelines of the economy. How have they pulled this off, and where have they gotten the money?

In a letter to Federal Reserve Chairman Ben Bernanke dated June 27, 2013, US Representative Alan Grayson and three co-signers expressed concern about the expansion of large banks into what have traditionally been non-financial commercial spheres. Specifically:

    [W]e are concerned about how large banks have recently expanded their businesses into such fields as electric power production, oil refining and distribution, owning and operating of public assets such as ports and airports, and even uranium mining.

After listing some disturbing examples, they observed:

    According to legal scholar Saule Omarova, over the past five years, there has been a “quiet transformation of U.S. financial holding companies.” These financial services companies have become global merchants that seek to extract rent from any commercial or financial business activity within their reach.  They have used legal authority in Graham-Leach-Bliley to subvert the “foundational principle of separation of banking from commerce”. . . .

    It seems like there is a significant macro-economic risk in having a massive entity like, say JP Morgan, both issuing credit cards and mortgages, managing municipal bond offerings, selling gasoline and electric power, running large oil tankers, trading derivatives, and owning and operating airports, in multiple countries.

A “macro” risk indeed – not just to our economy but to our democracy and our individual and national sovereignty. Giant banks are buying up our country’s infrastructure – the power and supply chains that are vital to the economy. Aren’t there rules against that? And where are the banks getting the money?

How Banks Launder Money Through the Repo Market

In an illuminating series of articles on Seeking Alpha titled “Repoed!”, Colin Lokey argues that  the investment arms of large Wall Street banks are using their “excess” deposits – the excess of deposits over loans – as collateral for borrowing in the repo market. Repos, or “repurchase agreements,” are used to raise short-term capital. Securities are sold to investors overnight and repurchased the next day, usually day after day.

The deposit-to-loan gap for all US banks is now about $2 trillion, and nearly half of this gap is in Bank of America, JP Morgan Chase, and Wells Fargo alone. It seems that the largest banks are using the majority of their deposits (along with the Federal Reserve’s quantitative easing dollars) not to back loans to individuals and businesses but to borrow for their own trading. Buying assets with borrowed money is called a “leveraged buyout.” The banks are leveraging our money to buy up ports, airports, toll roads, power, and massive stores of commodities.

Using these excess deposits directly for their own speculative trading would be blatantly illegal, but the banks have been able to avoid the appearance of impropriety by borrowing from the repo market. (See my earlier article here.) The banks’ excess deposits are first used to purchase Treasury bonds, agency securities, and other highly liquid, “safe” securities. These liquid assets are then pledged as collateral in repo transactions, allowing the banks to get “clean” cash to invest as they please. They can channel this laundered money into risky assets such as derivatives, corporate bonds, and equities (stock).

That means they can buy up companies. Lokey writes, “It is common knowledge that prop [proprietary] trading desks at banks can and do invest in a variety of assets, including stocks.” Prop trading desks invest for the banks’ own accounts. This was something that depository banks were forbidden to do by the New Deal-era Glass-Steagall Act but that was allowed in 1999 by the Gramm-Leach-Bliley Act, which repealed those portions of Glass-Steagall.

The result has been a massively risky $700-plus trillion speculative derivatives bubble. Lokey quotes from an article by Bill Frezza in the January 2013 Huffington Post titled “Too-Big-To-Fail Banks Gamble With Bernanke Bucks“:

    If you think [the cash cushion from excess deposits] makes the banks less vulnerable to shock, think again. Much of this balance sheet cash has been hypothecated in the repo market, laundered through the off-the-books shadow banking system. This allows the proprietary trading desks at these “banks” to use that cash as collateral to take out loans to gamble with. In a process called hyper-hypothecation this pledged collateral gets pyramided, creating a ticking time bomb ready to go kablooey when the next panic comes around.

That Explains the Mountain of Excess Reserves

Historically, banks have attempted to maintain a loan-to-deposit ratio of close to 100%, meaning they were “fully loaned up” and making money on their deposits. Today, however, that ratio is only 72% on average; and for the big derivative banks, it is much lower. For JPMorgan, it is only 31%. The unlent portion represents the “excess deposits” available to be tapped as collateral for the repo market.

The Fed’s quantitative easing contributes to this collateral pool by converting less-liquid mortgage-backed securities into cash in the banks’ reserve accounts. This cash is not something the banks can spend for their own proprietary trading, but they can invest it in “safe” securities – Treasuries and similar securities that are also the sort of collateral acceptable in the repo market. Using this repo collateral, the banks can then acquire the laundered cash with which they can invest or speculate for their own accounts.

Lokey notes that US Treasuries are now being bought by banks in record quantities. These bonds stay on the banks’ books for Fed supervision purposes, even as they are being pledged to other parties to get cash via repo. The fact that such pledging is going on can be determined from the banks’ balance sheets, but it takes some detective work. Explaining the intricacies of this process, the evidence that it is being done, and how it is hidden in plain sight takes Lokey three articles, to which the reader is referred. Suffice it to say here that he makes a compelling case.

Can They Do That?

Countering the argument that “banks can’t really do anything with their excess reserves” and that “there is no evidence that they are being rehypothecated,” Lokey points to data coming to light in conjunction with JPMorgan’s $6 billion “London Whale” fiasco. He calls it “clear-cut proof that banks trade stocks (and virtually everything else) with excess deposits.” JPM’s London-based Chief Investment Office [CIO] reported:

    JPMorgan’s businesses take in more in deposits that they make in loans and, as a result, the Firm has excess cash that must be invested to meet future liquidity needs and provide a reasonable return. The primary reponsibility of CIO, working with JPMorgan’s Treasury, is to manage this excess cash. CIO invests the bulk of JPMorgan’s excess cash in high credit quality, fixed income securities, such as municipal bonds, whole loans, and asset-backed securities, mortgage backed securities, corporate securities, sovereign securities, and collateralized loan obligations.

Lokey comments:

    That passage is unequivocal — it is as unambiguous as it could possibly be. JPMorgan invests excess deposits in a variety of assets for its own account and as the above clearly indicates, there isn’t much they won’t invest those deposits in. Sure, the first things mentioned are “high quality fixed income securities,” but by the end of the list, deposits are being invested in corporate securities [stock] and CLOs [collateralized loan obligations]. . . . [T]he idea that deposits are invested only in Treasury bonds, agencies, or derivatives related to such “risk free” securities is patently false.

He adds:

    [I]t is no coincidence that stocks have rallied as the Fed has pumped money into the coffers of the primary dealers while ICI data shows retail investors have pulled nearly a half trillion from U.S. equity funds over the same period. It is the banks that are propping stocks.

Another Argument for Public Banking

All this helps explain why the largest Wall Street banks have radically scaled back their lending to the local economy. It appears that JPMorgan’s loan-to-deposit ratio is only 31% not because the bank could find no creditworthy borrowers for the other 69% but because it can profit more from buying airports and commodities through its prop trading desk than from making loans to small local businesses.

Small and medium-sized businesses are responsible for creating most of the jobs in the economy, and they are struggling today to get the credit they need to operate. That is one of many reasons that banking needs to be a public utility. Publicly-owned banks can direct credit where it is needed in the local economy; can protect public funds from confiscation through “bail-ins” resulting from bad gambling in by big derivative banks; and can augment public coffers with banking revenues, allowing local governments to cut taxes, add services, and salvage public assets from fire-sale privatization. Publicly-owned banks have a long and successful history, and recent studies have found them to be the safest in the world.

As Representative Grayson and co-signers observed in their letter to Chairman Bernanke, the banking system is now dominated by “global merchants that seek to extract rent from any commercial or financial business activity within their reach.” They represent a return to a feudal landlord economy of unearned profits from rent-seeking. We need a banking system that focuses not on casino profiteering or feudal rent-seeking but on promoting economic and social well-being; and that is the mandate of the public banking sector globally.
This work is licensed under a Creative Commons Attribution-Share Alike 3.0 License

Ellen Brown developed her research skills as an attorney practicing civil litigation in Los Angeles. In Web of Debt, her latest of eleven books, she turns those skills to an analysis of the Federal Reserve and “the money trust.” She shows how this private cartel has usurped the power to create money from the people themselves, and how we the people can get it back. She is president of the Public Banking Institute, http://PublicBankingInstitute.org, and has websites at http://WebofDebt.com and http://EllenBrown.com.

So conservatives and libertarians have been claiming for decades that America will only be truly free when everything is privatized. We are well on our way to their dream. Yet the more privatization and less regulation we have, the less freedom the middle-class and working poor have. Deregulation has made our economy dependent on a few large banks. It is like claiming a table is more stable with just two legs. Wall Street has more than recovered from the recession, yet where are the jobs saving Wall Street was supposed to create. They play games with exotic investments and corruption of interest rates while the middle-class is slowly becoming the barely getting by class.

Conservatism Turns Morality Upside Down, Torturers Go Free, Patriots Go To Jail

Conservatism Turns Morality Upside Down, Torturers and Liars Go Free, Patriots Go To Jail

The team the authorized and carried out a torture regime and the invasion of a Iraq, George W. Bush, Donald Rumseld, and Dick Cheney are facing no time in jail this week.

Manning was a 25-year-old Army private first class at the time of his arrest. He saw himself as an idealist acting to end the wars, and said in online chats with hacker Adrian Lamo that he was particularly concerned about the abuse of detainees in Iraq. No political or military higher-ups have ever been prosecuted for detainee abuse or torture in Iraq, Afghanistan or at Guantanamo Bay.

"One of the serious problems with Manning's case is that it sets a chilling precedent, that people who leak information ... can be prosecuted this aggressively as a deterrent to that conduct," said Andrea Prasow, senior counterterrorism counsel and advocate in Human Rights Watch's U.S. Program. "Shouldn't we be deterring people who commit torture?"

Here are some of the individuals who have been involved since 9/11 in detainee abuse and torture, and potential war crimes, and have never been prosecuted.

Conservative Republican George W. Bush

George W. Bush was president when the U.S. invaded Iraq based on faulty intelligence, tortured terror prisoners and conducted extraordinary renditions around the world.

"Enhanced interrogation," a Bush administration euphemism for torture, was approved at the highest level. A "principals committee" composed of Vice President Dick Cheney, National Security Advisor Condoleezza Rice, Defense Secretary Donald Rumsfeld, Secretary of State Colin Powell, CIA Director George Tenet and Attorney General John Ashcroft signed off on the methods.

"There are solid grounds to investigate Bush, Cheney, Rumsfeld, and Tenet for authorizing torture and war crimes," said Kenneth Roth, executive director of Human Rights Watch, when the group released a report called "Getting Away With Torture" in 2011.

Conservative Republican Dick Cheney

As Bush's vice president, Cheney pushed the nation over to the "dark side," as he called it, in the war on terror.

The U.S. used extraordinary renditions to swoop up terror suspects and send them to repressive regimes in places like Syria and Libya for torture. Cheney was the key driver in producing the faulty intelligence that led the U.S. into war in Iraq. And he steadfastly defended the CIA's use of water-boarding and other torture tactics on U.S. prisoners.

Cheney "fears being tried as a war criminal," according to Colin Powell's former chief of staff Col. Lawrence Wilkerson, but he never has been.

Conservative Republican Donald Rumsfeld

One of the planners of the Iraq War, Rumsfeld steadfastly maintained while Defense Secretary under Bush that U.S. soldiers did not have an obligation to stop torture being used by their Iraqi counterparts. He also approved of "stripping prisoners naked, hooding them, exposing prisoners to extremes of heat and cold, and slamming them up against walls" at Guantanamo.

While deployed to Iraq, Manning discovered that Iraqi soldiers had arrested members of a political group for producing a pamphlet called "Where Did the Money Go?" decrying corruption in the cabinet of Prime Minister Nouri al-Maliki.

"‘i immediately took that information and *ran* to the officer to explain what was going on," Manning wrote in the chat logs. "he didn’t want to hear any of it … he told me to shut up and explain how we could assist the FPs in finding *MORE* detainees."

It is not just the barbaric and illegal acts of torture themselves, but patriots have to ask how many American troops died or were tortured in response to the torture done with the approval of a conservative administration. Torture is just one aspect of the many ways that conservatism is a complete betrayal of American values and justice.

Lying Conservative Clowns Betsy McCaughey, George Will, Krauthammer and Radicals at Fox News Try To Claim Obama Chipping Away Constitution

Lying Conservative Clowns Betsy McCaughey, George Will, Krauthammer and Radicals at Fox News Try To Claim Obama Chipping Away Constitution

Right-wing media have attempted to manufacture the claim that President Obama is abusing executive power by delaying implementation of the health care law's employer mandate and directing federal prosecutors to avoid maximum drug sentences in some cases, despite the legality of both practices.

Right-Wing Media Claim Health Care Delay Is Unconstitutional

Betsy McCaughey: Obama Is "Chipping Away At The Constitution." In an Investor's Business Daily op-ed, former New York Lieutenant Governor Betsy McCaughey claimed that President Obama's move to delay the employer mandate provision of the Affordable Care Act "reveals how disconnected this president is from this nation's history and constitutional principles":

    With the exception of Richard Nixon, these presidents -- from Eisenhower to Reagan to Clinton and both Bushes -- have not tried to exempt themselves from the Constitution.

    Article II, Sec. 3 of the Constitution commands the president to faithfully execute the law. Courts have consistently ruled that presidents have little discretion about it. Obama can't pick and choose what parts of the Affordable Care Act he enforces and when. [Investor's Business Daily, 8/13/13]

Wash. Post's George Will: "Obama's Unconstitutional Steps Worse Than Nixon's." In an August 14 Washington Post column, George Will claimed that Obama does not have authority to delay the employer mandate, calling his "unconstitutional steps worse than Nixon's":

    Serving as props in the scripted charade of White House news conferences, journalists did not ask the pertinent question: "Wheredoes the Constitution confer upon presidents the 'executive authority' to ignore the separation of powers by revising laws?" The question could have elicited an Obama rarity: brevity. Because there is no such authority.

    [...]

    Neither does the Constitution confer on presidents the power to rewrite laws if they decide the change is a "tweak" not involving the law's "essence." Anyway, the employer mandate is essential to the ACA. [The Washington Post, 8/14/13]

Krauthammer: "Of Course It's Unconstitutional" To Delay The Mandate. On the July 9 edition of Fox News' The O'Reilly Factor, host Bill O'Reilly asked Fox News contributor Charles Krauthammer, "Do you think it's unconstitutional for the president to take an existing law that he signed and say we're not going to force part of that law, the employer mandate? Is that unconstitutional?" Krauthammer replied, "Of course it's unconstitutional. The Constitution says the executive has to faithfully execute the laws and here it is faithfully ignoring a law it doesn't like in the same way it wantonly passed the DREAM Act unilaterally, an act that the Congress had rejected. It is absolutely lawless in the things it does. This is only the latest example." [Fox News, The O'Reilly Factor, 7/9/13 via National Review Online]
Experts Argue That Obama Administration Has Authority To Implement Delay

Constitutional Scholar Simon Lazarus: Delay Is "Well Within The Executive Branch's Lawful Discretion." In a post in The Atlantic, Constitutional Accountability Center Senior Counsel Simon Lazarus wrote that the delay is "a sensible adjustment to phase-in enforcement, not a refusal to enforce" and "well within the Executive Branch's lawful discretion":

    The relevant text requires that the President "take care that the laws be faithfully executed." Scholars on both left and right concur that this broadly-worded phrasing indicates that the President is to exercise judgment, and handle his enforcement duties with fidelity to all laws, including, indeed, the Constitution. As McConnell himself notes, both Republican and Democratic Justice Departments have consistently opined that the clause authorizes a president even to decline enforcement of a statute altogether, if in good faith he determines it to be in violation of the Constitution. But, McConnell contends, a president cannot "refuse to enforce a statute he opposes for policy reasons." While surely correct, that contention is beside the point.

    The Administration has not postponed the employer mandate out of policy opposition to the ACA, nor to the specific provision itself. Thus, it's misleading to characterize the action as a "refusal to enforce." Rather, the President has authorized a minor temporary course correction regarding individual ACA provisions, necessary in his Administration's judgment to faithfully execute the overall statute, other related laws, and the purposes of the ACA's framers. As a legal as well as a practical matter, that's well within his job description. [The Atlantic, 7/17/13]

SCOTUSblog's Denniston: Supreme Court Gave Agencies Discretion Regarding

Implementation. In a post on Constitution Daily, legal expert Lyle Denniston pointed out that "Article II does not say that a law shall be carried out at all cost, so every President operates on the assumption that federal agencies can be given some leeway in how they do it." Denniston pointed to a recent Supreme Court case as relevant, writing that the court "just last month went a long way toward requiring federal courts to trust the government agencies that execute the laws to interpret for themselves just what authority Congress has given them in their areas of official activity":

    Given the complexity of modern government operations, very few of the laws that Congress passes are completely self-executing; most if not all of them require regulations to put them into actual effect. And writing regulations is the business of the federal agencies.  An array of government agencies have been working for more than three years, for example, to write the rules for the new Affordable Care Act - the vast new law regulating the entire health care financing system.

    The Supreme Court just last month went a long way toward requiring federal courts to trust the government agencies that execute the laws to interpret for themselves just what authority Congress has given them in their areas of official activity.  What an agency decides is the range of its power, that ruling said, should be given considerable deference by the courts.

    Very telling in that decision in the case of City of Arlington, Texas, v. Federal Communications Commission is that it was written by Justice Antonin Scalia, the Court's strongest believer that the courts should be very strict in following the letter of the laws that Congress passes.  The actual text, not what someone said about it, is what controls, he has said, over and over. Scalia, a former professor of administrative law, seems quite tolerant of agency discretion. [Constitution Daily, 7/10/13]

Fox Claims Drug Sentencing Guideline Change "Unlawful"

Krauthammer: Obama Administration Decision To Avoid Mandatory Minimum Sentence Is "Unlawful." On Fox News' Special Report, Charles Krauthammer reacted to Attorney General Eric Holder's decision to direct federal prosecutors to avoid triggering mandatory minimum sentences for certain drug-related charges by claiming the change is "unlawful":

    KRAUTHAMMER: What he's done now, what he's proposed with these drug laws is worse than just suspending the parts of the law and instructing prosecutors not to prosecute. He also is telling prosecutors who already have prosecutions in place that they can withhold evidence so that the defendant won't get a maximum or a mandatory penalty. I mean, that is illegal. That's unlawful, that's -- I mean, that is simply shocking that that would be the instruction from an attorney general.

    I think as one former attorney general, deputy attorney general said, if you did that in a private case, you would be accused of a felony if you were prosecuting it and you were withholding evidence. And it is epidemic. It isn't only in this, it is in the Obamacare law, the administration's own law, the parts of which it is suspending. It is in the DREAM Act, which is a unilateral suspension. [Fox News, Special Report with Bret Baier, 8/12/13 via Media Matters]

Fox & Friends Lists "Overruling Congress On Drug War Sentences" As Evidence Of Abuse Of Power. On the August 16 edition of Fox News' Fox & Friends, guest host Shannon Bream claimed that "there are questions about abuse of power" and that "we've seen this administration, not just the president but others in the administration, decide when they're going to" uphold Article II of the constitution "and when they aren't." Co-host Brian Kilmeade asked if he's "breaching the Constitution," listing, among other things, "overruling Congress on drug war sentences." [Fox News, Fox & Friends, 8/16/13]
Holder Advised Prosecutors To Exercise Authority They Currently Possess

NY Times: Prosecutors Have Broad Discretion On Charges. In a 1988 article on the decision to not bring charges against Reagan Attorney General Edwin Meese over his involvement in the Iran-Contra Affair, The New York Times noted that prosecutors have "almost unfettered authority to decide" how to prosecute cases, including "what evidence to present":

    The decision of an independent prosecutor this week not to seek criminal charges against Attorney General Edwin Meese 3d has focused new attention on the broad and controversial power granted to American prosecutors in deciding who shall be brought to justice.

    Far more than in any other democracy, American prosecutors have almost unfettered authority to decide whom to charge, what crimes to identify, what penalties to seek, what bail to urge, what witnesses to call, what evidence to present, what persons to give immunity from prosecution, what plea bargains to make and what sentences to negotiate.

    [...]

    The discretion afforded American prosecutors is defended on the ground that it provides for case-by-case flexibility and ultimately more leniency for deserving defendants. But critics say it has been abused with considerations of race, class and political affiliation. Draft protesters, users of small amounts of marijuana and minor traffic offenders have challenged verdicts and sentences by showing that others were not prosecuted for similar crimes, and prosecutorial bias has been charged in jury selection and death penalty cases.

    The subject has grown so controversial in recent years that it has been the focus of more than 200 law review articles and 280 Federal court cases since 1985. That does not count the thousands of scholarly law articles, speeches and the cases in state and local courts.

    ''It's a fundamental topic in the criminal justice system,'' said Philip B. Heymann, a professor of law at Harvard who was the Assistant United States Attorney General in charge of the criminal division from 1978 to 1981.

    Mr. Heymann, who heads the Center for Criminal Justice at Harvard, said prosecutors have the authority not to bring charges even when they think they can prove a crime has been committed. He noted that such decisions are necessary in part because there is so much crime in the United States; prosecutors could not possibly process all of it.

    The Federal courts have consistently upheld a prosecutor's powers. ''The discretion allowed prosecutors,'' the Supreme Court said last year in a trademark infringement case, Young v. United States, ''is so broad that decisions not to prosecute are ordinarily unreviewable.'' Only in cases of flagrant abuse, including criminal activity by a prosecutor, may a court overrule a prosecutor's decision, the Court has said. [The New York Times, 7/22/88]

Wash. Post: Decision To Change How Criminal Complaints Are Made Is A Change He Can Make On His Own; Other Initiatives Require Legislative Action. The Washington Post reported that Holder's memo to prosecutors represents a change to drug policy he can do on his own authority:

    The attorney general can make some changes to drug policy on his own. He is giving new instructions to federal prosecutors on how they should write their criminal complaints when charging low-level drug offenders, to avoid triggering the mandatory minimum sentences. Under certain statutes, inflexible sentences for drug crimes are mandated regardless of the facts or conduct in the case, reducing the discretion of prosecutors, judges and juries.

    Some of Holder's other initiatives will require legislative change. Holder is urging passage of legislation with bipartisan support that is aimed at giving federal judges more discretion in applying mandatory minimum sentences to certain drug offenses. [The Washington Post, 8/12/13]

Conservative Policy Analysts: Holder Has Authority For His Directive. On National Review Online's The Corner blog, Vikrant P. Reddy and Marc A. Levin from the Texas Public Policy Foundation's Right On Crime initiative explained that the attorney general has the authority to suggest prosecutors use their discretion to reduce sentences, but recommended it be followed up with legislation:

    The attorney general has exercised his authority to provide guidance to federal prosecutors to exercise discretion in applying mandatory minimums in drug cases to ensure that the longest sentences are reserved for kingpins. Nonetheless, this administrative action comes five years into this presidency and could be undone at the whim of this or any future attorney general. Therefore, statutory reforms are still needed to ensure that the law provides a reasonable range of punishment for low-level federal drug offenses such that there is enough prosecutorial and judicial flexibility to craft sentences that fit the crime. [National Review Online, The Corner, 8/13/13]

Gosh, conservatives keep telling us they are experts on the Constitution and legal theory, yet these conservative zealots are not even familiar with legal actions and precedents set by conservatives. Could it be that Betsy McCaughey, George Will, Krauthammer and Radicals at Fox News are acting like petulant anti-American brats who think its fine when conservatives do it, but the end of the world when Democratic patriots do the same thing.

Wisconsin Conservative Scott Walker (R) is Turning Wisconsin Into Iran, And the Police Are Helping

Wisconsin Conservative Scott Walker (R) is Turning Wisconsin Into Iran, And the Police Are Helping

I went to the Wisconsin capitol again today to report on the Solidarity Singers, as I’ve done many times before. I was not intending to get arrested. Nor did I want to get arrested. But that’s what happened.Taken by the author before he himself was arrested by Wisconsin police. (Credit: The Progressive)

I arrived about fifteen minutes late for the one-hour noon sing along, which has been going on steadily for two and a half years now.

When I arrived, I was told that Madison city council member Mark Clear had already been arrested, while he was singing “This Land Is Your Land.” This seemed to be an escalation, since he was the first currently serving elected official to be rounded up in the more than 200 arrests that Scott Walker’s capitol police have made in the last few weeks. (Former longtime member of the Madison school board, Carol Carstensen, was arrested a couple of weeks ago. She’d never even gotten a speeding ticket before, she told me.)

I got out my reporter’s pad, and I did my usual head count, tallying 100 people in the rotunda and 60 people as sympathetic observers in the balcony.

I interviewed Sharon Puttmann, who was holding a sign that said, “United in Purpose, United in Song,” which I took a picture of. I asked her why she was there. “I’m a teacher, and I’m a mom,” she said. “And I’m standing up for my rights.” She’s never been arrested, she told me. But she’s willing to now.

I interviewed Victoria La Chappelle, who was holding a sign saying, “You can tie my hands, but you can never silence my voice.” She’s been arrested twice. “Every time I come, I feel like I need to come back in solidarity,” she said.

I saw that the Raging Grannies were in attendance again, this group of activist elderly women who sing protest songs at various events in the state.

Then I saw some state police officers move in to arrest a couple of the Raging Grannies, including my friend Bonnie Block.

So, as I’ve done every time I’m covering the capitol, I started to take pictures of the officers making the arrest. And then I followed the officers as they took Block, handcuffed and still defiantly singing, toward the elevator.

I was hoping to get a picture of Block as she entered the elevator, the kind of picture that has been taken many times in the last couple of weeks.

But the police officers said to stand back. I said I was a journalist, the editor of The Progressive magazine.

“You can’t be here,” they said.

“I’m with the press,” I said. “I have a right to be here.”

Whereupon, without a warning that I’d be arrested, Officer S. B. Mael grabbed my hands and put them behind my back, cuffed them, and said, “Obstruction.”

“That’s ridiculous,” Block said, as she was put in the elevator.

“This is getting absurd, guys,” I said to the officers, who refused to engage with me.

They took me to the basement of the capitol, frisked me, and put me in a chair.

Block, who was then sitting nearby, said, “It’s a pleasure to be arrested with you.”

“Likewise,” I said.

And she and the handful of other protesters kept singing, “Bring Back My Wisconsin to Me.”

When Block was released, another woman in a red “Wisconsin Mom” shirt came down, handcuffed, and was seated nearby.

Her name was Ellen Holly, the chairman of the Walworth County Democrats, she told me, and she comes up to Madison whenever she can. She was on her way to Minnesota, she said, and wanted to support the sing along. (She also said that the Democrats were up to 45 percent of the vote in traditionally conservative Walworth County.)

The police kept me in the basement of the capitol until all the protesters had left. They took down my name and Social Security number and address and phone number and employer (I reminded them I worked at The Progressive).

And then they hauled me off in a squad car to the Dane County jail just three blocks away, where I was frisked again, booked, fingerprinted, had my mug shot taken, and kept in a holding cell with three other inmates for an hour and twenty minutes before being released.

The paper they gave me on the way out said, under “Charge,” 946.41(1) Resisting or Obstructing.”

The bond was set at $300.

The court date is September 23 at 10:00 a.m., where I will plead not guilty on the basis of the First Amendment.

The reason that citizens exercising their Constitutional rights in Wisconsin are being treated this way is because Scott Walker and the conservative movement cannot abide anyone protesting or witnessing the growth of the conservative cancer eating up the state. In order to treat public workers like wage slaves on the Conservative plantation, Walker and fellow conservative Republicans made a deal with police unions to leave them alone. The irony will be when the police and firefighters in Wisconsin have their rights taken away; who will speak up for the police who sided with the anti-democracy thugs. What goes around comes around.

Patriots Know The Deficit is Shrinking, Even Though Anti-American Conservatives Scream Otherwise

Patriots Know The Deficit is Shrinking, Even Though Anti-American Conservatives Scream Otherwise

Remember all those deficit hawks who screamed that the federal deficit is spiraling out of control and must be stopped with spending cuts that have a funny way of hurting the pocketbooks of the most vulnerable Americans? Their excuse for ripping us off has been literally disappearing, but a new Google survey shows that not only do the vast majority Americans not know it — half of the public actually believes that the deficit is growing [3].

Here are the facts: The U.S. budget deficit has been shrinking at a rapid rate over the last few months. The deficit peaked at 10.2 percent of GDP in 2009, but over the past four quarters, it has shrunk to a mere 4.2 percent of GDP. What’s more, the Congressional Budget Office predicts [4] that the deficit will fall to 2.1 percent of GDP in 2015.

Why such a disconnect? Unfortunately, disgraceful propaganda has left the public misinformed and confused.

Over in Economic Wonderland, the deficit hawk duo of Alan Simpson and Erksine Bowles have made a second career over the last several years wildly exaggerating the deficit issue and scaring Americans into thinking that deep cuts in the federal budget were necessary for the economy. The reality was just the opposite. If these two had ever sat down to read John Maynard Keynes, whose work is vital to understanding how to respond to economic crises, they would have known that cutting the federal budget when the economy is weak actually slows it down even more.  Yet to this day, Simpson and Bowles continue waging battle for a “grand bargain” that would shred the social safety net and cost many Americans their jobs by requiring trillions of dollars to be cut from the federal budget over ten years. All in the name of a “problem” that doesn’t even exist.

Deficit hawks like Simpson and Bowles, and their grand funder, hedge fund billionaire Pete Peterson, go on promoting the nonsense that the deficit is the major economic problem of 2013 despite the obvious facts and a growing consensus from economists that such a claim is utterly absurd. Incredibly, they do it even after the faulty work they relied on to make their case – a paper produced by two Harvard economists, Carmen Reinhart and Kenneth Rogoff – was discredited by a mere grad student [5] in one of the great academic revelations of our time. Even conservative economists are bowing to reality. The folks over at the conservative American Enterprise Institute, for example, have come to the conclusion [6] that austerity is a terrible idea and that without proper stimulus, the U.S. economy would look a lot more like Europe’s, where individual countries without sovereign currency have been forced to go the austerity route. It’s getting increasingly hard to deny that things have gotten pretty ugly over there because of deficit hawks and their ilk.

But deficit hawks are paid well to misinform the public. They write reports. They get corporate honchos to help them run campaigns with innocent-sounding names like “Fix the Debt.” They build websites. They write articles. They hold conferences. They pay off think tanks – even progressive ones – to play ball with them.  And the corporate dominated major media frequently are happy to play along. On it goes, until the lies repeated to the public take on the ring of truth.

So it’s no surprise that the public is not aware of the important news that the deficit is shrinking. Or that it is shrinking precisely for the reason progressive economists have been saying all along. When you have a recession, you have to juice the economy through government investment. That, in turn, reaps you the benefit of more money in people’s pockets, which leads to more jobs, more tax revenue for the government, and less reliance on social safety net programs like unemployment insurance or food stamps. If the original stimulus package had been bigger, the deficit would have shrunk even faster.

The deficit hawks have been more than spectacularly wrong. They have impacted policy in a way that turned the attention of Washington away from what it should have been focused on all along – jobs. Instead of a deficit commission, Obama should have called for a jobs commission to address the fact that hard-working people have not been able to find jobs to feed their families because of a Wall Street-driven financial crisis.

One might hope that the reality emerging will help squelch the calls to recklessly cut government investment in the economy. But there’s a big problem: Deficit lies benefit the 1 percent in the short-run. Rather than shrinking the deficit, what the short-sighted, greedy rich in America really want to shrink is their tax liabilities, which is why they don’t want to pay for things like education, infrastructure, and social safety net programs that benefit the population and ultimately help keep the economy humming.  The financiers among them would also dearly like to privatize things like Social Security so that they can collect fees on American retirement accounts. The corporate honchos like the way austerity drives up unemployment and drives down wages because they hold the mistaken view that keeping workers stressed and vulnerable is good for their bottom line. They want people like Larry Summers to head the Federal Reserve, who, while in the White House as the president’s chief economic adviser , famously presided over a stimulus program many economists warned was way too small.

In the fall, will deficit hawks in Congress manage once again to hold the American economy hostage? Or will reality finally rear its head? Facts have a tough time competing with well-funded mythology.

They're making up numbers and being shamelessly greedy because they believe, in the same way that cultist believe crap, that safety net programs like Social Security and Medicare are too expensive*. Conservative cultists dogma says that the people cannot join together to have the government run safety net programs for them - because we all know the history of economic recessions. We will have them and American workers always suffer the most. Conservatives and most libertarians just don't care. They always blame their screw-ups on workers and the poor. If workers and the poor had that much power we would have strong regulations in place that would prevent corporate America from acting like drunker casino dealers. The plutocrats will always come out on top, they don''t take risks with their money, they take risks with the assets of the American people.



* even though Social Security is run from its own fund and most of Medicare is funded by the working class Americans that need it most.)

Patriots Are Fed Up With The Anti-Americanism of The Wall Street Journal and Conservative Stephen Moore

Patriots Are Fed Up With The Anti-Americanism of The Wall Street Journal and Conservative Stephen Moore

The Wall Street Journal editorial board's Stephen Moore falsely claimed that the drastic budget cuts known as sequestration have had "none of the anticipated negative consequences," when in reality economists have explained that the cuts have had devastating effects on economic growth, jobs, and programs for low-income Americans.

Wall Street Journal's Stephen MooreIn an August 11 op-ed, Moore called the automatic budget cuts enacted March 1 -- which were designed to be so severe they would force Congress to adopt a more balanced approach to spending reduction -- an "underappreciated success" because they had resulted in "amazing progress" in reducing the deficit. Moore applauded the further deficit reduction that would come from "any normal acceleration of economic growth," and concluded by claiming that cuts to "military, education, transportation and other discretionary programs have also been an underappreciated success, with none of the anticipated negative consequences."

But economists were predicting major economic consequences, as The American Prospect noted on March 6:

    Private forecasting firm Macroeconomic Advisers estimates "sequestration would cost roughly 700,000 jobs (including reductions in armed forces)," while Moody's Analytics predicts a hit to real gross domestic product of 0.5 percent, just a hair below Fed Chairman Ben Bernanke's prediction 0.6 percent fiscal drag.

And as predicted, the cuts are harming the economy. Sequestration is having a negative effect on GDP growth and causing job losses. According to a new analysis by the non-partisan Congressional Budget Office, canceling the sequestration cuts would raise GDP by 0.7 percent and increase employment by 900,000 new jobs by 2014, and would lead to greater output and higher employment in the next few years.

Furthermore, tens of thousands of individuals have already seen federal unemployment benefits cut by as much as 10.7 percent, Meals On Wheels programs have had to cut hundreds of meals from their regular service to low-income seniors, and Head Start programs have had to cancel sessions for at-risk children. According to the Department of Education, sequestration further cut $60 million from federal funding for schools that educate children who live on Indian reservations, military bases, or in low-income housing. In some cases, districts will be forced to close schools and reduce the number of courses offered.

Economist Jared Bernstein, former economic adviser to Vice President Biden, has tracked and documented the drastic effects that the cuts are having on everything from Medicare-funded cancer treatments and public safety, to scientific and medical research. Finally, Secretary of Defense Chuck Hagel announced on August 6 that furloughs to civilian defense workers caused by sequestration have created "a military whose readiness remains seriously degraded."

Most patriotic Americans know by now that anti-American Australian publisher Rupert Murdoch owns the Wall Street Journal, so the editorial page and his employees represent Murdoch's radical anti-democracy, anti-worker, anti-education and anti-American points of view. It is in their political interests for them and their conservative political friends to do as much damage to the economy as they can so they can use their newspaper, radio stations and television networks to blame it all on patriotic Democrats who care about the USA and American families.

RNC Chairman Reince Priebus Acts Like Soviet Propagandist, Spreads Wacky Death Panel Rumor

RNC Chairman Reince Priebus Acts Like Soviet Propagandist, Spreads Wacky Death Panel Rumor

On Sunday, CNN’s State of the Union invited Republican National Committee Chair Reince Priebus to offer what turned out to be little more than a dump of Republican talking points opposing the Affordable Care Act. Obamacare is “European, socialist style-type health care,” Priebus told CNN. He even claimed that Republicans — who have now voted to repeal Obamacare’s protections for people with preexisting conditions 40 different times — are the true defenders of people who are unable to obtain health insurance without health reform. And then he dropped the death panels line — “what people don’t want are government panels deciding whether something’s medically necessary.” Watch it:

Priebus’ decision to drop this line without any context whatsoever represents an innovation in Republican messaging against providing health care to millions of Americans. The “death panel” smear originally emerged on former half-term Gov. Sarah Palin’s (R-AK) Facebook page, and was widely viewed at the time as an attack on a bipartisan proposal to enable Medicare to cover voluntary end-of-life counseling. After that proposal was dropped from the bill that ultimately became the Affordable Care Act, several Republicans — including Palin once again — retconned the term “death panels” to refer to a cost-cutting measure known as the Independent Payment Advisory Board or IPAB.

Although the IPAB is empowered to take some measures to bring down Medicare costs if those costs grow faster than a certain rate, it is expressly forbidden to take any action that might qualify as rationing care. Under the Affordable Care Act, no proposal generated by the IPAB may include “any recommendation to ration health care, raise revenues or Medicare beneficiary premiums under section 1818, 1818A, or 1839, increase Medicare beneficiary cost sharing (including deductibles, coinsurance, and co-payments), or otherwise restrict benefits or modify eligibility criteria.” Moreover, it is not at all clear that the IPAB will do anything at all, because Medicare costs are currently not growing fast enough to trigger the IPAB’s authority.

So the first provision Republicans labeled as a “death panel” wasn’t actually a death panel, and it didn’t even make it into the law itself. The second provision they labeled a “death panel” also isn’t a death panel, and it may not actually do anything at all. Four years after Sarah Palin invented this canard, the Republican National Committee Chair is reduced to simply asserting, without context or explanation, that death panels exist — and hoping someone out there will still believe him.

It is difficult to say where Republican National Committee Chair Reince Priebus received his political education, from the old Soviet Communists or from read fascist literature. Either way disinformation campaigns like his, Sarah Palin and the Republican party are not American ideals. These radical conservatives will not be happy until they impose an Iranian style totalitarian theocracy on the USA. That is why they wear flag pins and talk about god and country so much, to cover their UnAmerican agenda. These wacko radicals believe that they can fool all the people all the time.