Just another Reality-based bubble in the foam of the multiverse.

Saturday, August 21, 2010

the sell is the tell

As we're treated with pics of soldiers flooding the mom-and-pop run restaurants around the nation's military bases and told "the war in Iraq is over!" again and again- never mind those 50,000 troops, 50,000 mercenaries, and new State-department run mercenary contingient- Chris Floyd alerts us to one of the original New Pearl Harbor advocates that has recently been hired by the Obama administration to aid Petraeus Caesar.

...That's right; Frederick Kagan, the neocon architect of the Iraq "surge," the epitome of the armchair warriors who have sent thousands of human beings (including their fellow Americans) to needless death and plunged millions more into needless suffering, has been hired by the Peace Laureate Administration to serve as guide and counsel to the Laureate's newly appointed military supremo.

It goes without saying that Kagan -- yet another spawn of the Project for a New American Century, that gaggle of bloodthirsty Beltwayers who openly longed, in September 2000, for a "new Pearl Harbor" to scare the American public into supporting the group's hyper-militarist agenda -- is not an expert on "fighting corruption" or on Afghanistan, just as he knew nothing about Iraq. He is an "expert" on one topic only: churning out bullshit to justify war. And that is exactly why he has been hired by Obama and Petraeus...

...No one is allowed anywhere near the halls of power or the levers of influence if they do not subscribe to this consensus. Anyone who questions it is automatically relegated to the margins. Barack Obama would not have been nominated by his faction or elected president if he was not a zealous adherent of the imperial agenda, and all that it entails: endless war, erosion of liberty, endemic corruption, and economic injustice.

And that is why Obama is happy to employ figures from the Bush Regime, like David Petraeus (and his death-squad wingman, Stanley McChrystal), like Robert Gates, like the odious toady Frederick Kagan -- because he and they are part of the same system, the same agenda. This is the underlying reality of American politics today.

Obama is a Chicago school law school academic. Obama thinks the military industrial complex is the main engine of the government he heads, and as long as he thinks it so it will be. But who drives the engine? Why, follow what the high priests of Chicago school economics are advocating. Krugman does as good a job as anyone in the deconstruction:

...the apostles of austerity — sometimes referred to as “austerians” — brushed aside all attempts to do the math. Never mind the numbers, they declared: immediate spending cuts were needed to ward off the “bond vigilantes,” investors who would pull the plug on spendthrift governments, driving up their borrowing costs and precipitating a crisis. Look at Greece, they said.

The skeptics countered that Greece is a special case, trapped by its use of the euro, which condemns it to years of deflation and stagnation whatever it does. The interest rates paid by major nations with their own currencies — not just the United States, but also Britain and Japan — showed no sign that the bond vigilantes were about to attack, or even that they existed.

Just you wait, said the austerians: the bond vigilantes may be invisible, but they must be feared all the same.

This was a strange argument even a few months ago, when the U.S. government could borrow for 10 years at less than 4 percent interest. We were being told that it was necessary to give up on job creation, to inflict suffering on millions of workers, in order to satisfy demands that investors were not, in fact, actually making, but which austerians claimed they would make in the future.

But the argument has become even stranger recently, as it has become clear that investors aren’t worried about deficits; they’re worried about stagnation and deflation. And they’ve been signaling that concern by driving interest rates on the debt of major economies lower, not higher. On Thursday, the rate on 10-year U.S. bonds was only 2.58 percent.

So how do austerians deal with the reality of interest rates that are plunging, not soaring? The latest fashion is to declare that there’s a bubble in the bond market: investors aren’t really concerned about economic weakness; they’re just getting carried away. It’s hard to convey the sheer audacity of this argument: first we were told that we must ignore economic fundamentals and instead obey the dictates of financial markets; now we’re being told to ignore what those markets are actually saying because they’re confused.

You see, then, why I find myself thinking in terms of strange and savage cults, demanding human sacrifices to appease unseen forces.

And, yes, we are talking about sacrifices. Anyone who doubts the suffering caused by slashing spending in a weak economy should look at the catastrophic effects of austerity programs in Greece and Ireland.

Maybe those countries had no choice in the matter — although it’s worth noting that all the suffering being imposed on their populations doesn’t seem to have done anything to improve investor confidence in their governments.

But, in America, we do have a choice. The markets aren’t demanding that we give up on job creation. On the contrary, they seem worried about the lack of action — about the fact that, as Bill Gross of the giant bond fund Pimco put it earlier this week, we’re “approaching a cul-de-sac of stimulus,” which he warns “will slow to a snail’s pace, incapable of providing sufficient job growth going forward.”

It seems almost superfluous, given all that, to mention the final insult: many of the most vocal austerians are, of course, hypocrites. Notice, in particular, how suddenly Republicans lost interest in the budget deficit when they were challenged about the cost of retaining tax cuts for the wealthy. But that won’t stop them from continuing to pose as deficit hawks whenever anyone proposes doing something to help the unemployed...

Austerity is only for the proles, Dr. Krugman, it helps hone the edge of desperation required to fuel the engine of Empire.

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