~there are some implications here I’m not to thrilled about however our chances of reparation seem slim to none at this time…But… I’m never quite sure of France’s intentions, however it looks like Germany favors it also and I do admire Merkel….would this end up only taxing the middle class yet again??? The TPB is very good of robbing us ( ~jude…
With U.S. media obsessing on the fight here at home among conservatives vying to become president, most of them
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missed some big news about France, which already has a conservative president. This week, French President Nicolas Sarkozy announced that he would take the lead — even go it alone within Europe, if need be — in introducing and pushing a Financial Transaction Tax in his country.
That’s right — the conservative president of France wants to tax the financial traders and speculators.
Referring to the tax as a “moral issue” and blaming deregulation and speculation for the global economic meltdown, Sarkozy has said that traders must “repay for the damage they have caused.”
What does it tell us about U.S. politics that the conservative president of France – on this issue and others — is way to the left of President Obama? The U.S. president has not publicly promoted a Wall Street transaction tax (even though U.S. financial institutions, not the French, were largely responsible for the global crisis).
Sometimes called a “Robin Hood tax,” a Financial Transaction Tax is endorsed worldwide by everyone from conservative European leaders to the Pope and Archbishop of Canterbury to Bill Gates and Ralph Nader. The tax is tiny per transaction and would barely be felt by middle-class investors or their pensions or 401(k)’s, but it could raise big bucks from high-volume investors and impose a brake on the kind of speculation that tanked the world’s economy.
French President Sarkozy keeps explaining to the people of France and Europe that a small transaction tax raises billions for countries facing deficits.
Wouldn’t it be something if President Obama went to the American people with such a deficit proposal, instead of putting Medicare on the chopping block?
President Sarkozy invokes the “moral issue“ of financial institutions repairing the damage they caused. What a shock it would be to see President Obama aiming the “moral issue” at Wall Street profiteers and demanding repair of damage, instead of rewarding them with top White House jobs.
After failing to get resistant allies among European countries to join him, Sarkozy is going forward on his own – declaring yesterday: “If France waits for others to tax finance, then finance will never be taxed.”
Can you imagine Obama standing up to a resistant Congress on a Wall Street transaction tax? He can’t even stand up to his own advisers on the issue, according to Ron Suskind’s insider book on the Obama White House, “Confidence Men.” Suskind reports that Obama briefly embraced the tax and declared at one meeting: “We are going to do this!” But after Obama’s top economic adviser (and Wall Streeter) Larry Summers criticized the tax, the idea was buried at the White House.
That was back in 2009. But the idea is still alive on Capitol Hill. A couple months ago, Sen. Tom Harkin and Rep. Peter DeFazio introduced a Financial Transaction Tax bill in Congress that would easily raise $350 billion over 10 years. Rep. John Conyers introduced a similar bill last year — it would tax Wall Street to fund federal jobs programs.
A Wall Street transaction tax is backed by National Nurses United and other unions. It’s popular with the U.S. public, and would be even more popular if Obama were to campaign for it in 2012.
RootsAction.org has gained 50,000 signatures in support of the tax.
You can add your name here to those pushing Obama to (re)embrace the Wall Street tax.
And don’t get me wrong about President Sarkozy of France. He’s no great humanitarian. But he is facing an uphill reelection battle this year and the conservative president understands how popular a financial tax is with voters.
Facing reelection this year, maybe it’s time President Obama came to that same understanding.
Jeff Cohen is co-founder of RootsAction.org, author of “Cable News Confidential ,” and founder of the media watch group FAIR.
Publicly-owned banks were instrumental in funding Germany’s “economic miracle” after the devastation of World War II. Although the German public banks have been targeted in the last decade for takedown by their private competitors, the model remains a viable alternative to the private profiteering being protested on Wall Street today.
One of the demands voiced by protesters in the Occupy Wall Street movement is for a “public option” in banking. What that means was explained by Dr. Michael Hudson, Professor of Economics at the University of Missouri in Kansas City, in an interview by Paul Jay of the Real News Network on October 6:
[T]he demand isn’t simply to make a public bank but is to treat the banks generally as a public utility, just as you treat electric companies as a public utility. . . . Just as there was pressure for a public option in health care, there should be a public option in banking. There should be a government bank that offers credit card rates without punitive 30% interest rates, without penalties, without raising the rate if you don’t pay your electric bill. This is how America got strong in the 19th and early 20th century, by essentially having public infrastructure, just like you’d have roads and bridges. . . . The idea of public infrastructure was to lower the cost of living and to lower the cost of doing business.
We don’t hear much about a public banking option in the United States, but a number of countries already have a resilient public banking sector. A May 2010 article in The Economist noted that the strong and stable publicly-owned banks of India, China and Brazil helped those countries weather the banking crisis afflicting most of the world in the last few years.
In the U.S., North Dakota is the only state to own its own bank. It is also the only state that has sported a budget surplus every year since the 2008 credit crisis. It has the lowest unemployment rate in the country and the lowest default rate on loans. It also has oil, but so do other states that are not doing so well. Still, the media tend to attribute North Dakota’s success to its oil fields.
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As bad as the Greek financial crisis seems, the land of Pericles is only the second-most-indebted nation in the world. The government of Japan holds top honors: Its debt equals 234% of its GDP. The reason Japan hasn’t been in financial-crisis mode is that it owes most of that money to itself. By contrast, the U.S., seventh on our list, owes $4.4 trillion to foreigners. To China alone Uncle Sam owes a cool $1.1 trillion. Of course, when measured by total debt, the U.S. has the biggest IOU: $14.3 trillion.
By Brian Dumaine / Graphic by Nicolas Rapp
- Think US debt is high? Take a look at Europe’s most indebted nations. (csmonitor.com)
- Op-Ed Contributors: The Downgrading of a Debtor Nation (nytimes.com)
- Just Another Step Towards Hell? (lewrockwell.com)
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BY JIM WILLIE
The US Federal Reserve has no monetary options whatsoever. They have been backed into the corner since 2007. It was coerced to reduce interest rates as the subprime mortgage crisis morphed into an absolute bond crisis, as the Jackass loudly stated during that fateful summer. The US bank leaders claimed it was contained. It was not. The USFed was backed into the corner in 2009, unable to raise interest rates from near 0% (the Zero Interest Rate Policy disease) and put into effect its propaganda theme of an Exit Strategy. The US bank leaders knew the longest period of time for the Fed Funds rate to stick at 0% was nine months, ensuring a future disaster. They saw it. They claimed a move toward normalcy. It did not come. The Jackass called them liars with a message of deception to manage the USTreasury Bond and stock market. They did not hike rates, as their bluff was called. The USFed looked weak as a result. They began to shed thick layers of prestige. The USFed was backed into the corner in 2010, unwilling to use printed money to monetize USTBonds, giving birth to the second dreaded Quantitative Easing disease. They did anyway. So the ZIRP & QE twin scourges became part of the landscape of ruin. The USFed denied they would embark on QE. The Jackass called them liars with a message of deception. They did embark on QE, then QE Lite, then QE2, all replete with denials. The USFed has lost all its prestige, all its credibility, and all its respect for economic analysis. They are actually a central office for the Syndicate. They are the focal point of the failure of the central bank franchise model.
The unfolding drama on Capitol Hill with the USGovt changed the entire picture, thus putting a toxic icing atop a hemlock pie with arsenic candles giving off deadly gas. In private discussions, my full expectation was for no debt default, not even close, with the debt limit extended, the unfolding American Tragedy saga taking place on a global stage. My call was for a path of least resistance to be taken in consensus, but it would involve decision avoidance and political expedience, if not constitutional cowardice. The players in the USCongress, along with the leader himself, were exposed as pusillanimous, deceptive, polarized, destructive, wayfaring fools. They are as much fully equipped squires for both the banking industry and the military establishment. They avoided a debt disaster in default, but they did not avoid a debt rating downgrade. They have given the system license to debase the USDollar further, as Gold has responded in a breakout. The President is so clueless as to believe patent reform can make a difference. The bigger obstacles are poor education, minimal math & science requirements, tendency to play video games & text messages than studying (even inside school classrooms). Of course the debilitation is compounded by the US lacking a strong industrial base. So better patent protection would mean the US corporations could more effectively protect their offshore jobs, where the majority of jobs are located.
Worse, the players on the global debt debate stage exposed the USGovt as Greece times one hundred. The veil of ruin and arrogance has been lifted for all to see, the deep blemishes and skin cancer visible for all to see. The USGovt borrowing costs are near 0% for the same reason that the Greek borrowing costs are at 30%. BOTH NATION’S FINANCES ARE BROKEN. To cap it off, the tombstone on the US Republic will feature a Super Committee to recommend the most difficult of budget decisions. Such fanfare without proper label. The committee is a formalization of the Politburo process, a perverse interwoven political stranglehold fabric that takes the worst of the Weimar Republic and melds with the worst of the Fascist Business Model. Slowly forming is the Fascist Dictatorship that follows logically from nationalization of Fannie Mae and AIG, the home mortgage cesspool and the derivative black hole. The growth of czars will grow dangerously. Look in the near future for a wave of office shutdowns. The USGovt is required to pay its creditors. But it will act with negligence and shut down offices. See the Federal Aviation Agency, which must contend with 70,000 job cuts. It has lost its funding, while the USCongress went on its August vacation. An improvement would have come if the cut in budget came to the Transportation Security Admin (TSA) to alleviate the public from airport assaults that draws tears from old ladies, anger from defiant citizens, and consternation from most everybody. By the way, the planned date for the Super Committee to convene and make its recommendations is in the middle of the Presidential Primary season next summer. Expect a circus.
The late president inherited a bad economy, and he cut taxes and slashed spending to spur growth…
Eighty-eight years ago this week, Calvin Coolidge took office upon the sudden death of President Warren Harding. Like the current administration, the Harding-Coolidge administration faced a tough recession from 1919-1921. But unlike the current administration, the Harding-Coolidge and Coolidge-Dawes administrations cut taxes, balanced budgets and slashed government spending, reducing federal debt by over a third in a decade.
The economy grew, averaging just over 7% from 1924 to 1929, the years of his presidency. So did Coolidge’s popularity. He was so popular that even during the Great Depression’s height song-writer Cole Porter compared his lover to the “Coolidge dollar.”
As the twin pillars of international monetary system threaten to come tumbling down in unison, gold has reclaimed its ancient status as the anchor of stability. The spot price surged to an all-time high of $1,594 an ounce in London, lifting silver to $39 in its train.
On one side of the Atlantic, the eurozone debt crisis has spread to the countries that may be too big to save – Spain and Italy – though RBS thinks a €3.5 trillion rescue fund would ensure survival of Europe’s currency union.
On the other side, the recovery has sputtered out and the printing presses are being oiled again. Brinkmanship between the Congress and the White House over the US debt ceiling has compelled Moody’s to warn of a “very small but rising risk” that the world’s paramount power may default within two weeks. “The unthinkable is now thinkable,” said Ross Norman, director of thebulliondesk.com.
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Posted: 12 Jul 2011 06:04 PM PDT
With reports like these –
“Small Businesses See Large Challenges” (MarketWatch)
Recent sentiment surveys underscore pessimism, uncertainty
Small-business owners have a dim view of the future, according to a gauge of their optimism for June that stands “solidly in recession territory,” the National Federation of Independent Business reported Tuesday.
The NFIB’s barometer ticked down for a fourth consecutive month in June, reflecting pessimism about future business conditions as well as expected sales. The survey’s participants, most of whom have fewer than 40 employees, are concerned about the government, among other issues, said Bill Dunkelberg, NFIB’s chief economist, in a statement.
Small businesses say, ‘What recovery?’
A huge force in this economy is being left out of the picture two years into the economic recovery.
“Between the deluge of new regulations and a Washington policy agenda that is largely ignorant of Main Street needs, stubbornly low consumer spending, and grave concern among small firms about the federal budget, there is not much to be optimistic about as a small-business owner,” Dunkelberg said.
“Nearly Two-Thirds of Americans Sense Double-Dip Recession” (HousingWire)
Roughly 63% of middle-class Americans surveyed by a consumer psychology consulting firm believe the U.S. economy slipped into a double-dip recession, up from 50% one year ago.
First Command Financial Services commissioned Sentient Decision Science to survey roughly 1,000 U.S. consumers between the ages of 25 to 70 with annual household incomes of at least $50,000 for the quarterly First Command Financial Behaviors index.
Three-quarters of those consumers who believe a double-dip recession is underway believe it will be more than one year before the economy begins to recover. One in five consumers said it would be take more than three years.
“Americans aren’t looking for a meaningful recovery any time soon,” said Scott Spiker, CEO of First Command Financial Services. “The Index reveals a widespread belief that the U.S. has already experienced a recession and a short-lived recovery and is now experiencing a second recession. This conviction is being fueled by a host of pressing economic worries that do not come with quick resolutions, further intensifying consumer uncertainty and concern.”
“CEOs Less Confident About Economy” (The Business Journal)