In addition to providing Saudi Arabia with intelligence and flying refueling missions for its air force, the United States has enabled the bombing campaign by supplying $20 billion in weapons over the past 18 months. In total, President Obama has sold more than $115 billion in weapons to the Saudi kingdom – more than any other president.
27 U.S. Senators Rebel Against Arming Saudi Arabia
https://theintercept.com/2016/09/21/27-u-s-senators-rebel-against-arming-saudi-arabia/
We typically think of the economy as consisting of four sectors: the external sector, households, businesses, and the government. In China however it is more practical to subdivide these further into the following:
- Creditors. Creditors are forced to absorb the losses associated with writing down the debt when the borrower defaults on its debt and restructures it with a principle or interest reduction. Much of China’s debt burden has been extended through the banking sector, however, and because the debt that must be written down exceeds the banking industry’s capital base, ultimately the cost will be passed on to some other economic sector – for example Chinese households ultimately absorbed the cost of the banking sector losses generated in the late 1990s.
- The external sector. To pass on costs to foreigners requires that they have significantly larger exposure to China than they actually do, and would also probably require defaulting on external debt, a path Beijing is unlikely to choose to follow.
- Ordinary households. Most banking crises, like the recent US and European crises and the Chinese banking crisis at the end of the 1990s, are resolved by hidden transfer mechanisms that pass the cost of writing down debt to households. China today however must increase household wealth, not reduce it, if consumption is to rise fast enough to allow investment to decelerate, which means ordinary households cannot be allowed to absorb the cost.
- Wealthy households. Given high levels of income inequality, and the low propensity to consume of the wealthy, forcing them to absorb the costs of writing down debt – in the form of highly progressive income taxes, for example – is likely to be among the less costly ways economically for Beijing to pass on the costs of paying down debt. As their income or wealth is reduced, the wealthy are likely to convert most of that reduction into lower savings and very little of it into lower consumption, thus minimizing its adverse impact on domestic demand.
- Small and medium enterprises. Chinese SMEs are among the most efficient economic entities in China and are likely to be the main source of innovation and value creation in the future. Their long-term success is vital to China’s long-term growth. Like ordinary households they should be protected from absorbing the costs of Beijing’s debt-management policies.
- Local and provincial governments. These have amassed a considerable amount of assets whose liquidation would most efficiently absorb debt write-down costs and would entail the lowest medium and long-term economic costs, although not perhaps the lowest political costs. As their assets are liquidated, total Chinese savings will decline and Chinese consumption will remain largely unchanged, thus minimizing the adverse impact on domestic demand.
- The central government. Beijing too could pay for the cost of writing down debt by liquidating central government assets, although this may conflict with other economic policy objectives, including overcoming vested-interest opposition to the reforms.
THE TOTAL U.S. budgetary cost of war since 2001 is $4.79 trillion, according to a report released this week from Brown University’s Watson Institute. That’s the highest estimate yet.
Neta Crawford of Boston University, the author of the report, included interest on borrowing, future veterans needs, and the cost of homeland security in her calculations.
The amount of $4.79 trillion, “so large as to be almost incomprehensible,” she writes, adds up like this:
- The wars in Iraq, Afghanistan, Pakistan, Syria, and other overseas operations already cost $1.7 trillion between 2001 and August 2016 with $103 billion more requested for 2017
- Homeland Security terrorism prevention costs from 2001 to 2016 were $548 billion.
- The estimated DOD base budget was $733 billion and veterans spending was $213 billion.
- Interest incurred on borrowing for wars was $453 billion.
- Estimated future costs for veterans’ medical needs until the year 2053 is $1 trillion.
- And the amounts the DOD, State Department, and Homeland Security have requested for 2017 ($103 billion).
The richest 1% of the UK population owns more than 20 times the wealth of the poorest fifth, according to Oxfam.
That made Britain one of the most unequal countries in the developed world and contributed to the vote for Brexit, the charity said.
Its analysis found that about 634,000 Britons were worth 20 times as much as the poorest 13 million people. Continue reading
Note two things here. First, there are a lot of dots with very low income growth, low enough to deserve the label “stagnant”. Second, wherever similar-coloured dots are on an upward slope, higher-income groups left their lower-income compatriots behind. Aside from the very lowest deciles (who are often cared for with welfare benefits), that very often seems the case. Again, Lakner and Milanovic looked into this, and wrote: “Some examples with particularly low real growth rates among rich economies include almost the entire lower halves of the income distributions in Austria, Germany, Denmark, Greece and the United States. They all had overall 20-year growth rates of less than 20 per cent which translates, in the best case, as 0.9 per cent per capita annually.”
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Last month the Air Force declared its variant “ready for combat,” and most press reports lauded this as a signal that the program had turned a corner. But a memo issued from the Pentagon’s top testing official, based largely upon the Air Force’s own test data, showed that the declaration was wildly premature.
Michael Gilmore’s latest memorandum is damning. The F-35 program has derailed to the point where it “is actually not on a path toward success, but instead on a path toward failing to deliver the full Block 3F capabilities for which the Department is paying almost $400 billion.”
The 16-page memo, first reported by Tony Capaccio at Bloomberg and then by others, details just how troubled this program is — years behind schedule and failing to deliver even the most basic capabilities taxpayers, and the men and women who will entrust their lives to it, have been told to expect.
The Pentagon’s top testing office warns that the F-35 is in no way ready for combat since it is “not effective and not suitable across the required mission areas and against currently fielded threats.” Continue reading
Total 2015 defense revenues for the Top 100 companies came in at $356.7 billion, down more than 7 percent from the 2014 Top 100 total of $385.8 billion. The top 25 companies accounted for 73 percent of total defense revenues in the year, and the Top 10 firms accounted for 54 percent of total defense revenues in the year, an improvement from the last two cycles, which saw that percentage drop a point each in 2013 and 2014.
Geographically, 41 of the Top 100 firms are based in the US, which accounted for 60 percent of total defense revenue, up from 54 percent in 2014 – a sign that even as other nations expand their defense industries, American companies remain dominant on the global stage. Europe has 27 companies featured, which increases if Russia’s six major defense companies are included, while the Asia-Pacific region has 17 companies. In contrast, Africa and South America were represented by a single firm each. …
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The United States took the top slot as the world’s super power, while Britain took the only Global Power slot, bringing her in second behind America.
Regional powers include France, China, India and Germany, while local powers were those such as Italy, Brazil, and Turkey.
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Well, a big part of the story is that the UK (like the U.S.) has a very weak labor market. This was a result of conscious policy decisions. The Conservative government put in a policy of austerity that had the effect of reducing demand in the UK and slowing the rate of job creation. In this context, of course employers get to call the shots.
Serious people would address the context which has denied workers bargaining power. It is not “technology” as Harris and his elite Trumpians would like to pretend, it is macroeconomic policy. But Harris has no time for talking about macroeconomic policy. He dismisses a plan put forward by Labor Party Leader Jeremy Corbyn to produce full employment as, “either naive or dishonest” adding “but they reflect delusions that run throughout Labour and the left.” Continue reading
Britain is now the second biggest arms dealer in the world, official government figures show – with most of the weapons fuelling deadly conflicts in the Middle East.
Since 2010 Britain has also sold arms to 39 of the 51 countries ranked “not free” on the Freedom House “Freedom in the world” report, and 22 of the 30 countries on the UK Government’s own human rights watch list.
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The Army made headlines in mid-August 2016 when a Defense Department Inspector General report landed with a heavy thud. The 75-page reportdetailed all the ways the Army screwed up its accounting of the Army General Fund in 2015.
According to the report, Army bookkeepers screwed up the budget to the tune of … $6.5 trillion dollars.
Retired Army Gen. Richard Cody, a vice president at L-3 Communications, the seventh largest U.S. defense contractor, explained to shareholders in December that the industry was faced with a historic opportunity. Following the end of the Cold War, Cody said, peace had “pretty much broken out all over the world,” with Russia in decline and NATO nations celebrating. “The Wall came down,” he said, and “all defense budgets went south.”
Now, Cody argued, Russia “is resurgent” around the world, putting pressure on U.S. allies. “Nations that belong to NATO are supposed to spend 2 percent of their GDP on defense,” he said, according to a transcript of his remarks. “We know that uptick is coming and so we postured ourselves for it.”
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In the summer of 1967, King announced what was to be the most expansively radical adventure of his life – a national movement called the Poor People’s Campaign, mobilizing Black, White, Hispanic, Native American. It was to demand an annual $30bn federal investment to deliver full employment, guaranteed annual income, 300,000 units of low cost housing per year.
Tragically, Dr. King was assassinated on 4th April 1968, and the April 16 edition of USA Look magazine carried a posthumous article from King titled “Showdown for Nonviolence” — his last statement on the Poor People’s Campaign. The article warns of imminent social collapse and suggests that the Campaign presents government with what may be its last opportunity to achieve peaceful change — through an Economic Bill of Rights. Three weeks after Dr King’s death, the Committee of 100 — set up to lobby on behalf of the campaign – called for just this – an economic bill of rights with five planks to deliver economic justice.
Despite the intervening decades since the Poor People’s Campaign, it is true to say that Dr King would recognise the same issues today as he faced then – inequality, corporate power, racism and militarism. Now, we have other factors that also need to be incorporated – climate change, the total capture and consolidation of political power by the financial and business class; the globalisation of the neo-liberal agenda (north and south alike). So, it is imperative for our renewed Economic Bill of Rights to reflect this.
Among the big ideas, the one that will be integral for us to solve the first 2 demands of the 1968 Economic Bill of Rights in the 21st century is the universal basic income. Continue reading
| Real wage change (%) | Employment rate change (percentage points) | |
| Greece |
-10.4 |
-9.0 |
| UK |
-10.4 |
0.6 |
| Portugal |
-3.7 |
-5.4 |
| Italy |
0.9 |
-2.3 |
| Czech Rep |
1.1 |
1.0 |
| Ireland |
1.6 |
-7.9 |
| Spain |
2.8 |
-8.5 |
| Netherlands |
3.4 |
-1.7 |
| Denmark |
4.0 |
-3.2 |
| Lithuania |
4.3 |
5.5 |
| Israel |
4.3 |
1.9 |
| Finland |
4.3 |
-3.8 |
| Belgium |
4.4 |
-0.7 |
| Japan |
4.7 |
2.6 |
| Latvia |
4.9 |
-3.0 |
| USA |
6.4 |
-3.4 |
| Austria |
6.5 |
1.2 |
| OECD average |
6.7 |
-0.6 |
| Slovenia |
7.2 |
-4.3 |
| Australia |
7.2 |
-0.7 |
| Hungary |
9.3 |
5.9 |
| Canada |
9.4 |
-1.7 |
| Sweden |
10.1 |
-0.7 |
| France |
10.5 |
-1.8 |
| Luxembourg |
11.1 |
-1.2 |
| Switzerland |
11.3 |
0.5 |
| Slovakia |
12.3 |
0.9 |
| Estonia |
13.4 |
2.2 |
| Germany |
13.9 |
5.1 |
| Poland |
23.0 |
4.5 |
The report argues:
- A financial transactions tax could likely raise over $105 billion annually (0.6 percent of GDP) based on 2015 trading volume. This estimate is roughly in the middle of recent estimates that ranged from as high as $580 billion to as low as $30 billion.
- The full amount of this tax would be borne by the financial industry, and not individual holders of stock or pension funds and other institutional investors. Evidence suggests that trading volume is elastic with respect to price, meaning that any drop in trading volume resulting from the tax would reduce costs for end users by a larger amount than the tax would increase them.
- It is reasonable to believe that the industry would be no less effective in serving its productive use (allocating capital) after the tax is in place. This means that one of the primary effects of the tax would be to reduce waste in the financial sector, reducing costs while having little or no effect on its principal purpose: to allocate capital effectively.
- The revenue raised through an FTT would easily be large enough to cover the cost of free college tuition (among other social programs), although if nothing were done to stem the growth rate of college costs, it would eventually prove inadequate.
The report also notes that the financial sector is the main source of income for many of the highest earners in the economy. This means that downsizing the industry through an FTT could play an important role in reducing income inequality.
The F-35 Joint Strike Fighter is possibly one of the most useless jets and biggest waste of taxpayer money ever conceived by the US military. In fact, according to Pierre Sprey, one of the three men that created the F-16, the point of this plane is “to spend money.” He clarifies, “that is the mission of the airplane, is for the US Congress to send money to Lockheed [Martin].”
This, on current trends, will be the hottest year ever measured. The previous record was set in 2015; the one before in 2014. Fifteen of the 16 warmest years have occurred in the 21st century. Each of the past 14 months has beaten the global monthly temperature record. But you can still hear people repeating the old claim, first proposed by fossil fuel lobbyists, that global warming stopped in 1998.
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Thousands of assault rifles such as AK-47s, mortar shells, rocket launchers, anti-tank weapons and heavy machine guns are being routed through a new arms pipeline from the Balkans to the Arabian peninsula and countries bordering Syria.
The suspicion is that much of the weaponry is being sent into Syria, fuelling the five-year civil war, according to a team of reporters from the Balkan Investigative Reporting Network (BIRN) and the Organised Crime and Corruption Reporting Project (OCCRP).
Arms export data, UN reports, plane tracking, and weapons contracts examined during a year-long investigation reveal how the munitions were sent east from Bosnia, Bulgaria, Croatia, Czech Republic, Montenegro, Slovakia, Serbia and Romania.
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The two global banks with the largest derivatives exposures are J.P. Morgan and Deutsche Bank. The derivatives exposure of J.P. Morgan is around $70,000 billion and of Deutsche Bank €55,000 billion. These figures are, respectively, about one-and-a-half times the total value of all the assets in the USA, and twenty times German national income. But the numbers in the balance sheets of these banks are much lower. Deutsche Bank declares its investment in derivatives at €768 billion: not a small amount, but only a modest fraction of the bank’s exposure. Deutsche Bank’s financial position is set out in Fig. 9.
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The Joseph Rowntree Foundation (JRF) estimates that the impact and cost of poverty accounts for £1 in every £5 spent on public services.
The biggest chunk of the £78bn figure comes from treating health conditions associated with poverty, which amounts to £29bn, while the costs for schools and police are also significant. A further £9bn is linked to the cost of benefits and lost tax revenues. …
The JRF report, called “counting the cost of UK poverty”, estimates that 25% of healthcare spending is associated with treating conditions connected to poverty.
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Tipping Point North South 