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Saint Janet Yellen: The Best Fed Chair Ever?

by Barkley Rosser  (originally published at Econospeak)

Saint Janet Yellen: The Best Fed Chair Ever?

OK, so the immediate reaction of many to this title might be to laugh, but I challenge anybody reading this to name another Fed Chair who was clearly better than she is.  I do not think you can.  However, one reason why one may not think much about her is that things have been so inconsequential since she has been Chair.  Nothing much has happened.  She continued the Quantitative Easing for awhile started by Bernanke and then stopped it.  Inflation has remained below 2% mostly.  Growth has not been dramatic, but it has been steady and higher than in most other advanced market capitalist economies.  There has not been a recession since 2009.  There have been no bubbles and no crashes.  Nothing dramatic has happened and certainly nothing bad, even if lots of deep problems of the US economy such as inequality remain.  But that one is not the Fed’s responsibility anyway.  So, bottom line, she has been doing a great job even if everybody is quite certain Trump will replace her, with all kinds of candidate names being thrown around.  But none of these will be better than she has been.

So, going backwards her most serious rival might be her immediate predecessor, who  looks to have played a substantial role in the save of September, 2008 that involved buying a lot of eurojunk from the ECB, only to roll it off over the next six months or so.  Of course some of the more innovative things done then were coming out of the NY Fed, but Bernanke did an excellent job when the crisis hit.  At the same time, Janet was around during that period, initially as San Fran Fed president, and then later as Vice Chair.  But where Bernanke looks not so good is the runup to that crisis, where he seems really not to have seen it coming.  Who saw it coming and as far back as 2005 sounding the alarm about the housing bubble?  Oh, right. Janet Yellen.

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“Nothin’ but ‘blue skies’ do I see”

A little Ella Fitzgerald for you today. Kind of fits with what is going on in the US today.

Over at Vox, Matt Yglesias has an interesting article on the Trump Transition Team ordering government economists to cook up rosy economic forecasts. With his far reaching economic “it will be great” promises during the election, delusional Trump has laid out a “blue skies” future which is likely unobtainable with the past economic growth of less than 2%. Trump intends to get there with increased spending on military and infrastructure, tax reform, cuts in regulations, etc. and never touching Randian Paul Ryan’s favorite target of cuts to Social Security and Medicare. Still, The Fed and CBO are forecasting growth at less than 2% going forward.

The Transition Team has a plan . . . “a regulatory rollback and tax reform unleashing growth, driving a recovery in productivity, sending business investment higher, and drawing idled workers back to the labor force.” Trump asserts faster growth to be the result of regulatory rollback and tax reform and will result in economic growth soaring to 3 to 3.5% . . . well above the CBO and Fed’s reasoned estimates. All of this and no Fed interest rate increases forecasted as foreign funds will flock to the US to invest and fund this growth (think of the mortgage market pre-2008 attracting all the foreign money looking for safe haven after Greenspan nixed Fed Rate increases).

The Wall Street Journal’s Nick Timiraos suggests the numbers arrived at for growth were not arrived at by any process at all; instead, “the transition team gave CEA staff the growth target the budget would produce and told them to fill in data supporting the target and necessary to make it happen.” The logic could work if the end result, the target, is realistic. As Matt points out the deficit would be larger; but the economy would be 17% larger and the deficit as a part of GDP much smaller (hmmm, deficit growth . . . sounds like Reagan and Bush II all over again).

So, Trump has an overly optimistic budget based upon phenomenal growth which defies what every one else believes will happen and he will pass the budget to Congress. Watching everything else which has happened over the last 30 days; if Congress balks or does not find a way to make Trump’s budget proposal happen, similar accusations will be forth coming from The White House as to how Congress failed (think Appeals Court) to make things happen which impacts every citizen in the US. Everybody’s fault except his. Then too, Trump was left quite a mess . . .

Expect another week of listening to Trump complaining about how everyone failed him.

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Recall and the General Strike

by Sandwichman

Recall and the General Strike

The tradition of the oppressed teaches us that the “emergency situation” in which we live is the rule. — Walter Benjamin, On the Concept of History, 1940

Back in December, I posted Full Employment and the Myth of the General Strike to start the conversational ball rolling about the idea of a general strike. It was the middle post in a three-part series on full employment.
Events move fast in 2017.
In the past two days, op-eds have appeared in the Washington Post and the Guardian taking up the issue of job action — and the general strike — as forms of resistance. On Monday, the Guardian published a Comment is Free by Francine Prose, “Forget protest. Trump’s actions warrant a general national strike.” This morning, “Where’s the best place to resist Trump? At work.” by labor lawyers, Moshe Marvit and Leo Gertner, was published as a PostEverything by the Washington Post.
Apparently, a call has gone out for a general strike on February 17, which strikes me (no pun intended) as rather precipitous. But the conversation is rolling.
Another element I would like to throw in is “what are the demands?” That Trump stop doing nasty things? That the GOP house and the GOP senate impeach the one who is going to sign their tax cut bills? I propose recall — total recall. Not only are the elected officials themselves corrupt, incompetent and unrepresentative but the electoral system that has installed them has been thoroughly corrupted and undemocratic. Throw the bums — AND THE NAG THEY RODE IN ON — out.
To give context and American (U.S.) historical resonance to that demand, it is useful to consider Populist and Progressive proposals for “direct democracy,” through initiative, referendum and the “imperative mandate” (recall) from over a century ago.
What am I really talking about here? What am I doing? The narrative time dimensions of the revolutionary general strike and of the reformist recall, as conceived by Populists and Progressives, could not be more contrasting. The general strike takes place in what Walter Benjamin referred to as jetztzeit — “not homogenous, empty time, but time filled by the presence of the now.”

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Dumbest Statement Coming Out of Congress Yet on Healthcare . . .

A partial of the Republican plan:

introduced by Rep. Mark Sanford (R-S.C.) and Sen. Rand Paul (R-Ky.), would end Medicaid expansion, decouple health insurance from employers, offer a tax credit of up to $5,000 to fund HSAs, and eliminate most regulations on what health plans must cover. Insurers would be able to sell policies across state lines; regulations that mandate birth-control coverage would be nixed.

Hmmmm, that’s nice . . .

This is about the dumbest statement I have read yet by Senator Rand Paul;

“What if 30 percent of the public had health savings accounts?” Paul asked. “What do you do when you use your own money? You call up doctors and ask the price. . . . If you create a real marketplace, you drive prices down.”

“What if” we were all billionaires, able to buy the best care, and negotiate with multi-billion dollar hospitals? Yea “what if” . . . “What if” all the Senators and Congressmen, and Judges had our very same healthcare plan? Yea “what if” . . . “What if” all of those people fighting against the PPACA had really put some effort into learning about it, put the effort into forcing Congress to move forward with making it better . . . where would we be today? Yea “What if” . . .

Still love kicking the one layer deep naysayers around as they too will get a douse of what this is all about if ESI disappears as well as birth-control. Healthcare policies across state lines will be similar to what bank chartering is like with a couple of states controlling all the policies and no real competition (just like interest rates and usury).

“What if . . . “

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A thought for Sunday: No, Trump isn’t imploding — but the opposition is broad and intense

by New Deal democrat

A thought for Sunday: No, Trump isn’t imploding — but the opposition is broad and intense

My post from two weeks ago, “No, Trump isn’t Imploding” got picked up by a few other sites within the past few days, and I wanted to follow up because we have a fuller picture of public opinion now.

Basically, Trump still isn’t imploding. He is holding his base. In fact, there is a little economic evidence that they are putting their wallets where their mouths have been. BUT, on the other hand, the opposition to Trump is revealing itself as broad-based and intense, in a way that hasn’t been seen in America since at least the 1960s (if not the 1930s or 1860s).

Here’s Gallup’s Presidential approval polling through yesterday:

Three weeks after the start of his Presidency, Trump’s last approval rating was 41%, down from 45% on his Inauguration Day. He has been between 41% and 43% for the last two weeks.

That’s simply not an implosion.  And his GOP base stands behind his controversial Executive Decrees.  For example, here’s the breakdown on support for his Muslim exclusion decree:


While Democrats are almost universally opposed, the support by GOPers is similarly almost universal.

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The Scale Of Trump’s Yemen Botch

by Barkley Rosser                (originally published at Econospeak)

The Scale Of Trump’s Yemen Botch

It is  becoming clear that the scale of the botch by Donald Trump in Yemen in his first effort at a foreign military action is much greater than .first reported, as reported by Juan Cole.   Right from the start we heard that people in the military were complaining about poor vetting of intel and how there was more military resistance than expected, with one American dying and three getting injured.  There was the embarrassment of a bunch of civilians getting killed, with the latest estimate of those now as high possibly as 30. On top of this we had the absurdity of the whole thing being decided mostly over a dinner with Steve Bannon and Jared Kushner the main parties to it, although supposedly SecDef Mattis signed off on it, followed by the bizarre business of Trump not even going to the Situation Room for this his first military outing.  Maybe he thought that since there were so many pictures of Obama there, and even with Hillary, that this is not something he wanted to do.

Of course there was pushback from the Trumpisti over this, claiming that the whole thing had been planned by Obama, who had just not  quite had enough time (or maybe even guts) to finally sign off on it, and furthermore that some bad leaders of the target group, Al Qaeda in the Arabian Peninsula (AQAP), were killed.  The latter may be true, although as Juan Cole reports, the main target of the raid, AQAP leader Qassim al-Rimini, was not killed and has since put out an audio publicly mocking Trump.

But now Cole further reports (as have others) that Obama had apparently not decided to do the raid. It was long planned, but it was not just a matter of waiting for more intel.  They thought it was not a wise effort, and indeed it has not turned out well.

On top of that, now the Yemeni government led by Mansour Hadi that the US and Saudi Arabia support has just forbidden the US from engaging in any further ground military assaults.  Oh.  Cole suggests that aside from the matter of civilian casualties, there is the matter of Trump’s insulting Muslim immigration ban, which Cole reports has the leaders of this US-backed Yemeni government “disgusted.”  Oh.

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A thought for Sunday: of heartlessness, confidence and conviction

by New Deal democrat
A thought for Sunday: of heartlessness, confidence and conviction

First of all, let me join in full in the following from Calculated Risk:

These are not normal times, and I can’t just post economic data and remain silent on other issues.
Mr. Trump’s executive order is un-American, not Christian, and hopefully unconstitutional. This is a shameful act and no good person can remain silent.

I believe that the sheer heartlessness of Trump’s Order is a feature, not a bug.  It is designed for maximum media coverage in order to show his supporters that he is delivering on his promises.

It is likely that in a longer timeframe this will backfire, as the cruelty of separating families, turning away children, and refusing entry to people who already had legal permission to live here via visas and even green cards, turns people against Trump and his enablers.

Once upon a time, for academic reasons I read the same book that Trump was rumored to have by his bedside in NYC: the english translation of the full text of Adolf Hitler’s speeches. Hitler’s argument for getting ordinary Germans to go along with his extreme anti-Semitic agenda was masterful. It went in essence like this: “I know that there are a very few good Jews, and you may know a few of them.  But the vast majority of Jews, who you don’t know, are evil.  In order to get rid of the vast majority of evil Jews, we have to sweep up a few of the good ones. So don’t worry, we will take care of it.”  By getting people to overlook their own experience with Jews they knew, he prevailed.

In contrast – for example – gay rights triumphed when enough people knew gays in their ordinary lives, and realized that they were no different from anybody else. So they were unable to see any valid reason to discriminate against them.

This ban is much more like the second situation than the first. Hitler argued that he might have to inflict hardship on a few good people in order (allegedly) to get to the mass of bad apples.  Trump is inflicting a lot of harm on a mass of good people in order (allegedly) to get to a few bad apples

And we haven’t even gotten to the point yet when the same heartlessness is going to be inflicted on DREAMers.

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Worthy of debate

(Dan here)n There are all sorts of ideas about what is going on right now in the US, and many proposed opinions. Yves offers an opinion on the Women’s March itself, but I am watching both locally and state wide (MA) where the follow up is actually happening, what forms it takes, and who is involved. Perhaps others can add knowledge and experiences to date. Certainly Democratic party leaders at the national level are searching for responses. I am going to leave my own experiences in the comments…I think this time around involvement by newcomers and activists might persist and figure out how to keep this energy effective. On the other hand, the testing of dedication is yet to come.

Women Skeptical of the Women’s March

Posted on February 10, 2017 by Yves Smith

Yves here. I’m hoisting this discussion from Water Cooler the day before yesterday. It echoes other doubts raised about the Women’s March, such as the ones in the Counterpunch story, No Pink Woolly Caps for Me. Seasoned protestors point out that the track record of non-issue-oriented marches, no matter how large scale, is poor, and the status of this march as officially sanctioned (blanket media coverage when other marches of hundreds of thousands of people have been minimized, police not tricked out in their usual riot gear) also indicates that the officialdom does not see it as a threat to the status quo.

In addition, as the discussants point out below, the March organizers’ demands were vague and not internally consistent. The reality was that the march was against Trump, as opposed to for a concrete policy program.

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California farming and our food sources

From the New York Times comes this information on the nature of immigration in California.

Mr. Trump’s immigration policies could transform California’s Central Valley, a stretch of lowlands that extends from Sacramento to Bakersfield. Approximately 70 percent of all farm workers here are living in the United States illegally, according to researchers at University of California, Davis. The impact could reverberate throughout the valley’s precarious economy, where agriculture is by far the largest industry. With 6.5 million people living in the valley, the fields in this state bring in $35 billion a year and provide more of the nation’s food than any other state.

Now he worries that a Trump administration could mandate a Homeland Security Department program called E-verify, which was aimed at stopping the use of fraudulent documents. In all but a few states, the program is voluntary and only a small fraction of businesses use it.

Farmers here have faced a persistent labor shortage for years, in part because of increased policing at the border and the rising prices charged by smugglers who help people sneak across. The once-steady stream of people coming from rural towns in southern Mexico has nearly stopped entirely. The existing field workers are aging, and many of their children find higher-paying jobs outside agriculture.

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Trump Administration Plays Havoc with Education–and your tax dollars

by Linda Beale

Trump Administration Plays Havoc with Education–and your tax dollars

Betsy DeVos was confirmed as Secretary of Education in a Senate vote that had every Democratic Senator voting against her, along with two brave Republican Senators (Lisa Murkowski, Alaska; and Susan Collins, Maine).  Thanks to those no-voters who showed integrity.  Regrettably, the vote created a tie, broken in DeVos’s favor by Trump’s Veep, Mike Pence.  Note that the result is that Senators representing by far the vast majority of the American people voted AGAINST DeVos.

As a Michigander, I can tell you firsthand that this is a disastrous choice for the head of the most important Education agency in the country.  Betsy DeVos is just another one of Trump’s billionaire crony capitalists who are using service in the government–which  is supposed to be about service on behalf of We the People–as a way to funnel more money to their fellow crony capitalists through elimination of protective regulations, open exploitation of federal lands, and willful ignorance about the harm that their crony capitalist policies have done and will do to the economy.

ASIDE:  Check out, for example, Melania Trump’s new lawsuit claiming $150 million in damages from The Daily Mail because it’s article on the company she modeled nude for suggesting that the company was an ‘escort service’ cost her the “once-in-a-lifetime opportunity” to get rich off of her “multi-term” exposure to being the most photographed woman in the world–i.e., (not explicitly stated but clearly implied) her status as First Lady.

Betsy DeVos  is an heiress with billions who married into another crony capitalist family with billions.  The DeVos family has used its wealth to curry favor and influence in state and federal government.  IN particular, Betsy DeVos has been busy using her wealth to remake public education in Michigan in line with her own particular religious and crony-capitalist views on Michigan’s education.  She supports junk science including “intelligent design“, the pseudo-science replacement term for religious “creationism”, in an attempt to undo scientific support for evolution.   She has pushed charter schools on Detroit–blaming any education shortcomings on dedicated teachers and disadvantaged students in public schools that have been deprived of hundreds of millions of state dollars owed them while turning a blind eye to the abject failures of for-profit charter schools in which ‘management companies’ rip off taxpayer dollars to overpay executives without having to comply with any of the accountability measures that are pressed on public schools that are underfunded. 

Betsy DeVos knows nothing about public education, knows very little about the privatized charter schools she pushes, knows nothing about education law, and knows nothing about improving education in inner cities or poor rural areas.   What she does know is that she supports any way possible to take taxpayer money and give it to religious and other private schools to use without accountability to the public.

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