Friday, June 5, 2009

College Grads Flock to Farms

Robin Wiesner, a Brown University graduate, cools off in the spray from a sprinkler as she walks with Luke Donahue at Wolf Pine Farm in Alfred on Wednesday. Since starting her apprenticeship at the farm April 1, she says she has found working and living there intensely satisfying. (Gregory Rec/Staff Photographer)

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Maine's organic growers attract more than 200 applicants to work and learn this season.

Beth Quimby
June 5, 2009 - Portland Press Herald (Maine)

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Just three days into her summer apprenticeship at Wolf Pine Farm, Elizabeth Hartsig, 27, appeared to be adjusting quickly to her first experience as an organic farmhand, despite a sunburn.

Hartsig, who grew up in the Chicago suburbs and has a master's degree in creative writing from Washington University in St. Louis, eagerly demonstrated what to do about the cutworms that have been showing up in the Swiss chard.

"You pick them up and rip them in half," she said.

Pest management is just one of the lessons Hartsig has learned since leaving a teaching job in Atlanta to spend the summer at the 50-acre farm owned by Amy Sprague and her husband, Tom Harms.

Hartsig must work the fields, tend to 80 chickens and help with the couple's 5-year-old and 3-year-old daughters.

Water must be hand-pumped and warmed via a solar panel, and wood for the stove must be split and stacked.

In exchange, Hartsig gets to live rent-free in an off-the-grid cabin with the other two apprentices. She gets four free meals a week, all of the farm's vegetables she can eat, a week's vacation and $700 a month.

Hartsig said she couldn't be happier.

"It is an incredibly beautiful place. I am very pleased to be here," she said.

Hartsig is one of hundreds of people spending the growing season at one of Maine's organic farms.

The Maine Organic Farmers and Gardeners Association, which links apprentices with farmers, has been flooded with applications, which normally run about 70 a year. This year, 230 people applied for positions at the 85 farms that participate.

Organic farmers around southern Maine said they have seen a big increase in inquiries about farming positions this year, including people who travel the world, stopping off to work for a couple of weeks through the World Wide Opportunities on Organic Farms network, known as WWOOF.

Rachel Seemar, co-owner with Bethanny Peters of the Wildroot Farm in Kennebunk, said this year's apprentice heard about their horse-powered farm by word of mouth while hiking around Puerto Rico last winter.

Now she is happily residing in the apprentice's quarters - a tent on a raised platform - and learning how to drive workhorses for a $300 monthly stipend.

How much the recession and dreary job market play into the surge of interest is unclear. But for Andrew Marshall, educational programs coordinator at the Maine Organic Farmers and Gardeners Association, the increase in apprenticeship applications reflects an explosion of interest in locally grown food and sustainable agriculture.

The fact that Maine's organic farming association is one of the country's oldest and one of only a few with an organized and staffed apprentice program might be responsible as well.

The apprentices tend to be educated, single adults in their 20s or 30s who have read all of the requisite books, such as Michael Pollan's "The Omnivore's Dilemma" or Barbara Kingsolver's "Animal, Vegetable, Miracle," but have little or no hands-on knowledge of food production.

"Frankly, most of the people who are interested don't have much experience with agriculture or even rural living," Marshall said.

Joey Listro, 22, is just a few college credits shy of graduating from the University of Southern Maine. He said his parents back in Connecticut were surprised when he announced his plan to spend his summer working at Rippling Waters Organic Farm in Standish.

"My parents were like, 'Wait a second, you are going to be a farmer? What were those four years of college education for?' " he said.

Organic farmers who take on apprentices rely heavily on them as a source of labor, and also take their responsibilities as teachers seriously.

Seth Kroeck of Crystal Spring Community Farm in Brunswick hands out notebooks with readings on agriculture to the four apprentices he takes on each year to help raise 125 lambs and 11 acres of vegetables for 225 customers who have bought shares of the harvest.

The apprentices have the choice of an apartment with all the amenities or a 1963 camper for their living quarters. They earn $800 a month and a small meal stipend.

"We pay at the top of the scale, but we are very selective," Kroeck said.

This year, the Crystal Spring group includes students or recent graduates from Brown University, St. Lawrence University, the University of New Hampshire and Prescott College.

Kroeck said that with all of that education, the level of discussion is high, which is important to him.

"Because we spend 60 hours a week together," he said.

Sprague, who got her own start in farming as an apprentice, said she has never had any of her helpers drop out, despite the long hours and hard work.

Robin Wiesner, 33, is a Brown graduate who majored in geology. She started her apprenticeship at Wolf Pine Farm on April 1 and said she quickly discovered why people don't leave.

The farm life is intensely satisfying, she said.

Although this is her first experience living outside a city, Wiesner said she relishes the dark and quiet at night. And she discovered that she had a real talent behind the wheel of a tractor.

"I'm in love with this place and this family," she said.

What Obama's "socialism" – the one all those right-wing nuts and true believers in the free market keep freaking out about – looks like.

- CommonDreams.org

Rumsfeld to 'face difficulties' over Guantanamo: UN expert

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May 3, 2009 - AFP

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GENEVA — Former US defence secretary Donald Rumsfeld could soon be in trouble for the role he played in human rights abuses committed in the Guantanamo prison, a United Nations expert said Wednesday.

"In a year or two, his responsibilities will be established. Wherever he goes, he will face difficulties," Leandro Despouy, who is Special Rapporteur on the independence of judges and lawyers, told journalists in Geneva.

A US bipartisan Senate report released late last year found Rumsfeld and other top administration officials responsible for abuse of Guantanamo detainees in US custody.

It said Rumsfeld authorised harsh interrogation techniques on December 2, 2002 at the Guantanamo prison, although he ruled them out a month later.

Despouy said the "strong resistance" put forward by the former US administration to current US president Barack Obama's decision to close the detention centre has nothing to do with the officially cited reason of "national security" considerations.

Rather they are fearful that they may be taken to task once the detention centre is closed, said Despouy.

The UN expert called on the international community to "support" Obama's decision to close the prison.

"If we act in the perspective of human rights, we should support the efforts of those who want these responsibilities to be established," he added, referring to the harsh interrogation techniques used on the detainees.

He said the international community should help the US by taking in former detainees.

Obama has said he would close the notorious "war on terror" prison at Guantanamo Bay, Cuba by January 2010 and is seeking host states for up to 60 of the 245 inmates.

The Obama administration however faces a series of legal and political hurdles at home in its efforts to close the base, with strong opposition against releasing detainees into the United States.

In January, the UN's special torture rapporteur called on the US to pursue Rumsfeld and former president George W. Bush for torture and bad treatment of Guantanamo prisoners.

"Judicially speaking, the United States has a clear obligation" to bring proceedings against Bush and Rumsfeld, the United Nations Special Rapporteur on Torture Manfred Nowak said, in remarks broadcast on Germany's ZDF television.

He noted Washington had ratified the UN convention on torture which required "all means, particularly penal law" to be used to bring proceedings against those violating it.

Medical bills play a role in 62% of bankruptcies, study says

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A study by Harvard researchers showing an increase in bankruptcies in which medical bills were a contributing cause could give Obama's bid for healthcare reform a boost.

Lisa Girion
June 4, 2009 - Los Angeles Times

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President Obama's push for healthcare reforms gets a boost today from a new study by Harvard University researchers that shows a sizable increase over six years in bankruptcies caused in part by ever-higher medical expenses.

The study found that medical bills, plus related problems such as lost wages for the ill and their caregivers, contributed to 62% of all bankruptcies filed in 2007. On the campaign trail last year and in the White House this year, Obama had cited an earlier study by the same authors showing that such expenses played a part in 55% of bankruptcies in 2001.

Medical insurance isn't much help, either. About 78% of bankruptcy filers burdened by healthcare expenses were insured, according to the survey, to be published in the August issue of the American Journal of Medicine.

"Health insurance is not a guarantee that illness won't bankrupt you," said Steffie Woolhandler, one of the authors, a practicing physician and an associate medical professor at Harvard.

"Lots of health insurance comes with big co-payments, deductibles and uncovered services," she said. "So you can be insured and still end up with big bills. At the same time, even if you have good insurance through your employer, you can lose it if you get sick and can't work."

Most people who filed medical-related bankruptcies "were solidly middle class before financial disaster hit," the study says. Two-thirds were homeowners, and most had gone to college.

The study does not suggest that medical expenses were the sole cause for these bankruptcies, but it does identify them as a contributing factor. The increase in such filings occurred despite a 2005 law aimed at making it more difficult for individuals to seek court protection from creditors.

And the latest study probably understates the current burden of medical expenses because it is based on bankruptcies filed before the recession hit.

The findings by a team of Harvard researchers from the law and medical schools are expected to help fuel the debate over what type of healthcare system is right for the U.S.

In a letter Wednesday, Obama made another push for a healthcare overhaul, reiterating his concern about the financial burden the current system places on families and businesses.

"Soaring healthcare costs make our current course unsustainable," he wrote in the letter to Sens. Edward M. Kennedy (D-Mass.) and Max Baucus (D-Mont.), who are leading efforts to develop healthcare legislation. "It is unsustainable for our families, whose spiraling premiums and out-of-pocket expenses are pushing them into bankruptcy and forcing them to go without the checkups and prescriptions they need."

Momentum has been growing in Congress for healthcare reform. Such change can't come soon enough for Mary McCurnin.

She and her husband, Ron, filed for bankruptcy and nearly lost their home near Sacramento after a series of medical crises, including her breast cancer and his open-heart surgery. Ron, 63, lost his insurance coverage when the company providing it lost its California license after paying 10% of his hospital bills. Mary, 59, managed to get on Medi-Cal after they "went broke."

Despite the ordeal, she said, the self-employed illustrators feel fortunate that they survived and managed to hang on to their home. "The healthcare industry is killing people," she said. "There's no other way to put it. We just got lucky."

Linda and Jeffrey Somach pay $800 a month for health insurance. But the Staten Island, N.Y., couple filed for bankruptcy a month ago when their out-of-pocket medical expenses surpassed $40,000.

Linda Somach, a psychologist, can earn $80,000 a year if she sees patients full time. But she had to scale back to care for Jeffrey, who has terminal brain cancer. That reduced their income. At the same time, she is constantly getting bills for out-of-network charges, deductibles and medical care that their insurance doesn't cover.

"We put so much of the medical stuff on credit cards," she said. "My patients do it too."

The study suggests that such plights are routine.

Woolhandler is on the board of Physicians for a National Health Program, a group that advocates for a single-payer system, in which government, not private insurers, brokers healthcare. She said the study showed that private insurers had failed in their core mission: protecting consumers from financial ruin in the event of a medical crisis.

"We need to rethink health reform," Woolhandler said. "Covering the uninsured isn't enough. Reform also needs to help families who already have insurance by upgrading their coverage and assuring they never lose it."

A spokesman for private insurers said the industry recognized that uncovered and expensive medical care imposed a burden on families and businesses. But he said that private insurers were in a better position to rein in spiraling medical costs and that the industry had a plan for protecting people from being forced into bankruptcy over medical expenses not covered by insurance.

"In fact, in our comprehensive reform proposal we recommended in December that Congress should look at an out-of-pocket spending cap and a system of tax credits for low-income people," Robert Zirkelbach, a spokesman for America's Health Insurance Plans, a Washington, D.C.-based trade group.

"If an individual's health expenses reached a certain level, there could be tax credits or other assistance to help those individuals," he said.

The study found that medical-related bankruptcy filers with private insurance reported average medical bills of $17,749. By comparison, people who filed for bankruptcy without insurance reported average medical expenses of $26,971.

Individuals with diabetes and neurological disorders, such as multiple sclerosis, had the highest medical bills, averaging $26,971 for those with insurance and $34,167 for those without. Hospital bills were the largest expense for about half the families that filed health-related bankruptcies.

Good Times

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Brian Morton 
June 3, 2009 - City Paper (Baltimore)

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I can't help but smile.

Sure, we're nowhere out of the weeds yet. Jobs are still hemorrhaging, gas prices have started sliding upward for the summer, North Korea is lighting matches next to their underground atomic bonfire project, the jury's still out on all the bailout money we've thrown at Wall Street, and the automakers and the entire state of California look like they're next at the payout window. But still, there remain things to laugh about.

For starters, there's the Manny, Moe, and Jack of fat, florid white politicians helming what's left of the Republican Party: Dick Cheney, Rush Limbaugh, and Newt Gingrich. The three of them are busy trying to drag America back into either the '90s (Gingrich), the '50s (Limbaugh), or the Dark Ages (Cheney), and none of them realize the long-lasting damage they are doing to the Republican Party. And you know what? Let them.

When President Obama named Sonia Sotomayor as his nominee to the Supreme Court, you would think that we hadn't had more than 200 uninterrupted years of white men on the Supreme Court, to hear Limbaugh howl about it. The list of Republicans lining up to claim that Sotomayor, a summa cum laude graduate of Princeton, was an "affirmative action" pick, is getting longer than Michael Steele's efforts to be listed in UrbanDictionary.com.

It didn't take long for Limbaugh to call Sotomayor a "reverse racist" (whatever the heck that's supposed to mean), Gingrich to tweet that she is a "Latina woman racist," or Washington pundit and GOP water-carrier Fred Barnes to imply that she is "not the smartest." It never fails to amaze how the most privileged section of American society can get its undies in a bunch the second someone not of its number is tapped for a post of authority where he or she might have some influence over "the clique."

Black leaders in America are quite used to the mainstream media running up to them and asking them to "disavow" any idiotic statement made by another black leader; for a while, there was a cottage industry for this any time Louis Farrakhan opened his mouth. This, however, does not work in reverse. One of the closest people to an actual national leader the Republicans have right now is Senate minority leader Mitch McConnell, who this past weekend was the sole guest on CNN's State of the Union with John King.

When King asked McConnell if he'd repudiate the words of Gingrich and Limbaugh, McConnell answered, "Look. I've got a big job to do dealing with 40 Senate Republicans and trying to advance the nation's agenda, and better things to do than be the speech police over people who have their views about a very important appointment."

So while we're laughing, we might want to have a little sympathy for McConnell trying to ride herd on his shrinking caucus. Because if you think about it, if his conservative colleagues continue to smear a member of the fastest growing segment of the American populace, in a few years, he might have even fewer senators of whom to keep track.

Lastly, we can now be entertained by the squirming of the Fox News conservatives who got up in arms about the Department of Homeland Security report on violent right-wing domestic extremism. Despite years of eliminationist rhetoric on the right from the grass roots at gun shows to mainstream talk radio hosts like Michael Savage and authors like Ann Coulter, conservatives manufactured a few days of outrage that the government might actually put together a cold-eyed assessment of the chances that someone might take it all seriously. DHS also put out a report on left-wing extremism, but it's pretty obvious after the last few months that there is virtually no comparison between the two.

Look at the record: Eric Rudolph, the Olympic Park bomber, was not a liberal. Timothy McVeigh was not a liberal. Randall Terry was not a liberal. Richard Poplawski, who shot three police officers in Pittsburgh back in April, claiming Obama wants to take his guns? Probably not a liberal. Jim David Adkisson, who opened fire in a church in Tennessee last year after leaving behind a manifesto saying he wanted to kill "every Democrat in the Senate and House, the 100 people in Bernard Goldberg's book"--I'm guessing he didn't give money to public radio and subscribe to Mother Jones. And it's a safe bet that Scott Roeder, accused of killing Dr. George Tiller in church on Sunday, isn't a liberal either.

So watching the hypocrites on Fox try to wriggle away from the televised fainting fits they had barely a month ago now that right-wing domestic terrorism has once again reared its ugly head might be worth a few chuckles.

Let's be real here: Times are tough all over, and it's quite likely the grimmest might be yet to come. General Motors is bankrupt, nobody knows what's up with Pakistan's nukes, and let's not forget that Osama bin Laden is still somewhere out there waving George W. Bush's "Get Out of Jail Free" card.

But entertainment is entertainment, and you've gotta find it where you can. And if you can't laugh at the problems of the Right, who can you laugh at?

Maryland's Donna Edwards: Emerging Leader, Liberal Maverick

Donna Edwards at the Take Back America conference in 2008 (photo by OurFuture.org)

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State's first black congresswoman opposes Obama war-funding plan

Paul West
June 4, 2009 - The Baltimore Sun

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When Congress gives President Barack Obama more funds later this month for wars in Afghanistan and Iraq, only one Maryland lawmaker is expected to dissent: Democratic Rep. Donna F. Edwards.

Edwards believes the president is taking the U.S. in the wrong direction in Afghanistan. She argues that Obama has no plan for winning and no strategy for getting out.

Congress "failed" its responsibility to challenge President George W. Bush's policies in Iraq, Edwards said in an interview. "And we can't make that mistake with President Obama."

After less than a year in the job, the first black woman elected to Congress from Maryland has stamped herself as the most liberal member of the state's congressional delegation. She is also building a national following on the left.

"We see her as an emerging leader, and I think she will really be a dynamic force in the Congress," said Robert L. Borosage, co-director of the Campaign for America's Future, which gave her a prominent place on the agenda at the liberal group's conference in Washington this week.

It's a heady ascent for the 50-year-old lawyer from Prince George's County, who had never held public office until last June. But standing up to a highly popular president from her own party - one whose margin of victory in her district was larger than any other in the state - seems right in character.

Edwards got her start in politics as a local activist, fighting plans for the $2 billion National Harbor project on the Potomac. The developer eventually agreed to her demand for residential housing at the hotel-retail complex.

The single mother of a college-age son then took on Rep. Al Wynn, her one-time boss as a Maryland state senator. Running to his left and attacking his support for the war in Iraq, she nearly upset the veteran Democrat in the 2006 primary; last year, she finished him off.

Like others on the left, Edwards is unhappy with some of Obama's early pragmatic decisions, such as withholding photos of Abu Ghraib detainee abuses (releasing them would be "part of how we reach the rest of the world," she contends) or taking a single-payer health care option off the table before congressional negotiations even started ("not helpful").

"I think at his core the president is one of us," Edwards told activists during a panel discussion at the conference. By bringing pressure from the left, liberals can "open up the political space for this president to do what his gut wants him to do anyway."

Three weeks ago, Edwards took the House floor in opposition to Obama's Afghanistan policy.

The president, she said, would "commit our servicemen and women to a war without end."

She was the only Marylander to vote against Obama's $96.7 million war funding request, which gained initial House approval on a bipartisan vote of 368-60, with 51 Democratic liberals opposed. A final vote is expected Friday.

Her "no" vote put her at odds with some on the left whose enthusiasm for Obama outweighs their doubts about his war plan. Moveon.org, which gained power as an antiwar group and was an influential part of an online coalition that backed Edwards, did nothing on the war funding vote, for example.

The hawkish Washington Post editorial board criticized her, but Edwards said she had given the issue considerable study and traveled to Afghanistan just days before opposing Obama's request.

They "may have called me naive for that" vote, she told the liberal activists. "But if we don't ask the questions now, we'll be asking ourselves these questions ten years from now, I guarantee that."

Another foreign-policy move that generated criticism was her refusal to support a measure that recognized Israel's right to defend itself against Hamas and blamed the Islamist movement for casualties in Gaza Strip fighting that flared in late December 2008. The Jan. 9 resolution was approved 390-5, with Edwards and 20 others voting "present."

It was "the wrong resolution at the wrong time," and not in the best interest of resolving the crisis, she explained after the vote. But Politico reported this week that Edwards had alienated some in the Jewish community in the Washington suburbs, who question the depth of her support for Israel.

"Look, I voted 'present' on a resolution that was apparently very important to the Jewish lobby. And so, obviously, that's going to result in an expression of, whatever, concern and questions," Edwards said during the interview in her House office.

She calls Israel "a really important ally" and says she's a strong supporter of the Jewish state. But "even with allies and partners, it's important for the United States also to stake out our own security interests and work with our allies and partners on those."

Edwards recently came back from a six-day trip to Israel, sponsored by the nonpartisan New America Foundation, that included a visit to the Gaza Strip. She said she backs Obama's efforts to secure a Mideast peace, including his call for a freeze on the expansion of Jewish settlements on the West Bank.

In another foray into foreign policy politics, she was one of five members of Congress arrested and taken into custody in late April outside the Sudanese Embassy in Washington in a protest against that government's human rights record in Darfur.

Her involvement raised questions about what kind of representative Edwards intended to be: a gadfly or a workhorse, a bomb-thrower or a serious inside player?

"I want to do what's right by people in my congressional district and in the country," she said. "I think people, at this early stage ... would describe me as somebody who's really thoughtful and careful and who does her homework."

At this early stage, some Democratic activists also describe the ambitious newcomer as a future statewide candidate, one with significant potential in party politics.

"She's a true believer," which would be an advantage in a Democratic primary contest, said Eddie Eitches, president of an American Federation of Government Employees local.

Edwards admits that she doesn't see "congresswoman" as the last job title on her professional resume. But she laughs off speculation about a run some day for the Senate.

"Oh, gosh," she responded and, referring to herself in the third person, added that "she's going to do her job in the United States Congress, is what she's going to do."

That, and move soon into a new home - a luxury National Harbor condo that she fought to make part of the waterfront development.

Thursday, June 4, 2009

The Deadly Toll of Abortion by Amateurs

A woman in Berega, Tanzania, who sought care after a botched abortion. In Tanzania, where abortion is illegal, the maternal death rate is high in part because of failed abortions. (Béatrice de Géa for The New York Times)

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Denise Grady
June 4, 2009 - The New York Times

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BEREGA, Tanzania - A handwritten ledger at the hospital tells a grim story. For the month of January, 17 of the 31 minor surgical procedures here were done to repair the results of "incomplete abortions." A few may have been miscarriages, but most were botched operations by untrained, clumsy hands.

Abortion is illegal in Tanzania (except to save the mother's life or health), so women and girls turn to amateurs, who may dose them with herbs or other concoctions, pummel their bellies or insert objects vaginally. Infections, bleeding and punctures of the uterus or bowel can result, and can be fatal. Doctors treating women after these bungled attempts sometimes have no choice but to remove the uterus.

Pregnancy and childbirth are among the greatest dangers that women face in Africa, which has the world's highest rates of maternal mortality - at least 100 times those in developed countries. Abortion accounts for a significant part of the death toll.

Maternal mortality is high in Tanzania: for every 100,000 births, 950 women die. In the United States, the figure is 11, and it is even lower in other developed countries. But Tanzania's record is neither the best nor the worst in Africa. Many other countries have similar statistics; quite a few do better and a handful do markedly worse.

Eighty percent of Tanzanians live in rural areas, and the hospital in Berega - miles from paved roads and electric poles - is a typical rural hospital, struggling to deal with the same problems faced by hospitals and clinics in much of the country. Abortion is a constant worry.

Worldwide, there are 19 million unsafe abortions a year, and they kill 70,000 women (accounting for 13 percent of maternal deaths), mostly in poor countries like Tanzania where abortion is illegal, according to the World Health Organization. More than two million women a year suffer serious complications. According to Unicef, unsafe abortions cause 4 percent of deaths among pregnant women in Africa, 6 percent in Asia and 12 percent in Latin America and the Caribbean.

Reliable figures on abortion in Tanzania are hard to come by, but the World Health Organization reports that its region, Eastern Africa, has the world's second-highest rate of unsafe abortions (only South America is higher). And Africa as a whole has the highest proportion of teenagers - 25 percent - among women having unsafe abortions.

The 120-bed hospital in Berega depends on solar panels and a generator, which is run for only a few hours a day. Short on staff members, supplies and even water, the hospital puts a lot of its scarce resources into cleaning up after failed abortions.

The medical director, Dr. Paschal Mdoe, 30, said many patients who had had the unsafe abortions were 16 to 20 years old, and four months pregnant. He said there was a steady stream of cases, much as he had seen in hospitals in other parts of the country.

"It's the same everywhere," he said.

On a Friday in January, 6 of 20 patients in the women's ward were recovering from attempted abortions. One, a 25-year-old schoolteacher, lay in bed moaning and writhing. She had been treated at the hospital a week earlier for an incomplete abortion and now was back, bleeding and in severe pain. She was taken to the operating room once again and anesthetized, and Emmanuel Makanza, who had treated her the first time, discovered that he had failed to remove all the membranes formed during the pregnancy. Once again, he scraped the inside of her womb with a curet, a metal instrument. It was a vigorous, bloody procedure. This time, he said, it was complete.

Mr. Makanza is an assistant medical officer, not a fully trained physician. Assistant medical officers have education similar to that of physician assistants in the United States, but with additional training in surgery. They are Tanzania's solution to a severe shortage of doctors, and they perform many basic operations, like Caesareans and appendectomies. The hospital in Berega has two.

Abortions in Berega come in seasonal waves - March and April, August and September - in sync with planting and harvests, when a lot of socializing goes on, Dr. Mdoe said. He said rumor had it that many abortions were done by a man in Gairo, a town west of Berega. In some cases, he said, the abortionist only started the procedure, knowing that doctors would have to finish the job.

Dr. Mdoe said he suspected that some of the other illegal abortionists were hospital workers with delusions of surgical skill.

"They just poke, poke, poke," he said. "And then the woman has to come here." Sometimes the doctors find fragments of sticks left inside the uterus, an invitation to sepsis.

In the past some hospitals threatened to withhold care until a woman identified the abortionist (performing abortions can bring a 14-year prison term), but that practice was abandoned in favor of simply providing postabortal treatment. Still, women do not want to discuss what happened or even admit that they had anything other than a miscarriage, because in theory they can be prosecuted for having abortions. The law calls for seven years in prison for the woman. So doctors generally do not ask questions.

"They are supposed to be arrested," Dr. Mdoe said. "Our work as physicians is just to help and make sure they get healed."

He went on, "We as medical personnel think abortion should be legal so a qualified person can do it and you can have safe abortion." There are no plans in Tanzania to change the law.

The steady stream of cases reflects widespread ignorance about contraception. Young people in the region do not seem to know much or care much about birth control or safe sex, Dr. Mdoe said.

In most countries the rates of abortion, whether legal or illegal - and abortion-related deaths - tend to decrease when the use of birth control increases. But only about a quarter of Tanzanians use contraception. In South Africa, the rate of contraception use is 60 percent, and in Kenya 39 percent. Both have lower rates of maternal mortality than does Tanzania. South Africa also allows abortion on request.

But in other African nations like Sierra Leone and Nigeria, abortion is not available on request, and the figures on contraceptive use are even lower than Tanzania's and maternal mortality is higher. Nonprofit groups are working with the Tanzanian government to provide family planning, but the country is vast, and the widely distributed rural populations makes many people extremely hard to reach.

Geography is not the only obstacle. An assistant medical officer, Telesphory Kaneno, said: "Talking about sexuality and the sex organs is still a taboo in our community. For a woman, if it is known that she is taking contraceptives, there is a fear of being called promiscuous."

In interviews, some young women from the area who had given birth as teenagers said they had not used birth control because they did not know about it or thought it was unsafe: they had heard that condoms were unsanitary and that birth control pills and other hormonal contraceptives could cause cancer.

Mr. Kaneno said the doctors were trying to dispel those taboos and convince women that it was a good thing to be able to choose whether and when to get pregnant.

"It is still a long way to go," he said.

TOON

Another reason not to buy Mitsubishi products

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Mitsubishi freezing fish to sell later as stock numbers plummet toward extinction

Martin Hickman
June 3, 2009 - The Independent/UK

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Japan's sprawling Mitsubishi conglomerate has cornered a 40 per cent share of the world market in bluefin tuna, one of the world's most endangered fish.

Bluefin tuna is being over-fished and its numbers can't be sustained, scientists say. (GETTY IMAGES)A corporation within the £170bn Mitsubishi empire is importing thousands of tonnes of the fish from Europe into Tokyo's premium fish markets, despite stocks plummeting towards extinction in the Mediterranean.

Bluefin tuna frozen at -60C now could be sold in several years' time for astronomical sums if Atlantic bluefin becomes commercially extinct as forecast, a result of the near free-for-all enjoyed by the tuna fleet.

In the forthcoming documentary film The End of the Line, Roberto Mielgo, a former bluefin fisherman who travels the world monitoring catches, claims that Mitsubishi buys and sells 60 per cent of the threatened fish and that it has expanded its freezer capacity to hold extra bluefin.

Mitsubishi acknowledges that it freezes bluefin, but only, it says, to even out peaks and troughs in supply.

"Mitsubishi Corporation handles between 35 per cent and 40 per cent of Atlantic and Mediterranean bluefin tuna imported to Japan," the company told The Independent.

"As we explicitly explained to the makers of the film, the fishing season for bluefin tuna in the Mediterranean is very short, making it necessary to freeze tuna to provide customers with stable supplies throughout the year."

Fish stocks across the world are in retreat because of over-fishing. One study suggests oceans will be stripped clean of all fish by 2048. Bluefin is imminently at risk of commercial extinction. The wildlife charity WWF forecasts that breeding stocks of the fish that migrate from the Atlantic to spawn will be wiped out in the Mediterranean by 2012.

Although the legal bluefin catch is set at 22,000 tonnes, conservationists suspect the actual catch is 60,000 tonnes, four times the maximum that marine scientists recommend. After studying catches and sales, Charles Clover, the environmental journalist behind the film The End of the Line, believes that businesses involved in the ransacking are deep-freezing 20,000 tonnes of bluefin a year for later use.

He hopes his film will galvanise the public about over-fishing in the same way Al Gore's An Inconvenient Truth mobilised opinion against climate change.

British retailers and chefs will not stock bluefin because it is so endangered. However, as disclosed in The Independent last week, the Japanese restaurant Nobu continues to serve it - while advising diners to choose a dish that is less environmentally damaging.

The fisheries body responsible for numbers, the International Commission for the Conservation of Atlantic Tunas (ICCAT), sanctioned a bluefin catch of 22,000 tonnes this year in defiance of its own scientists who advised no more than 8,500-15,000 tonnes.

WWF said the decision was a "disgrace". In fisheries circles, ICCAT is sometimes referred to as the International Conspiracy to Catch All Tuna. Rules forbidding the use of spotter planes to identify tuna shoals are flouted and boats are thought to have connections to organised crime in Italy.

Willie Mackenzie, a Greenpeace fish campaigner, said: "Mitsubishi are best known in the UK for making cars or electrical goods - and for most people it comes as a bit of a shock to find out they are one of the world's biggest traders in the endangered bluefin tuna. Bluefin tuna are as endangered as rhinos or tigers."

The shadow war in Balochistan

.....

Pepe Escobar
Jun 4, 2009 - Asia Times

.....

Just when Iran and Pakistan had reached a key Pipelineistan breakthrough, regional violence exploded involving, once again, "the greatest prize" Balochistan (Please see Balochistan is the greatest prize, May 9, 2009, Asia Times Online.)

The key question to ask is, as usual, cui bono?, or "Who profits?" What's behind this new, bloody intersection of Pipelineistan and the former "global war on terror" - a key theme US President Barack Obama would not dare touch in his Cairo address on Thursday to the "Muslim world"?

On May 22 in Tehran, Pakistani President Asif Ali Zardari and Iranian President Mahmud Ahmadinejad finally signed a preliminary agreement, after 14 long years of negotiations, to build the Iran-Pakistan (IP) pipeline, formerly the Iran-Pakistan-India (IPI), or "peace pipeline". (The final deal should, in theory, be sealed in less than two weeks.) The decision brazenly defied Washington's diktat. (Please see Pipelineistan goes Iran-Pak, May 29, 2009, Asia Times Online.)

On May 28 in Zahedan, in Sistan-Balochistan province in Iran, the Pakistan-based, hardcore Sunni, ultra-anti-Shi'ite outfit Jundallah ("Soldiers of God") claimed responsibility for a suicide bombing inside the Amir al-Momenin mosque that killed 25 people and wounded 125.

The timing and the circumstances could not be more suspicious. Tehran simply cannot understand how Islamabad could not contain Jundallah after it has been offered key, on-the-ground intelligence.

Tehran had told the Pakistani ambassador, M B Abbasi, that three Pakistanis - Haji Noti Zehi, Gholam Rasoul Zehi and Zabihollah Naroui - had confessed to smuggling explosives into Iran from Balochistan and passing them over to the suicide bomber. The trio was subsequently hanged in public in Zahedan on May 30.

As for the Iranian ambassador to Pakistan, Mashallah Shakeri, already on March 20 he had publicly accused Islamabad of allowing Balochistan to be a Jundallah base for the destabilization of Iran. Islamabad said "it ain't so", but facts on the ground spelled otherwise. Now it's even more serious, as the future of the IP pipeline is on the line.

How will the Balochis in the Pakistani army react? In Balochistan, the New Great Game in Eurasia is as enigmatic as it gets. There's an enormous discrepancy between some Baloch tribal leaders who live the good life in Karachi (in Sindh) and treat the province as their personal fiefdom, and an extremely destitute population who feels totally alienated by the Punjabi-dominated Pakistani establishment.

The shadowy 'foreign player'

And what does Jundallah really want? Jundallah, also known in Iran as the Rigi group (after its ringleader, Abdul Malik Rigi), is an outfit of Iranian Balochis, who happen to be Sunni and fiercely anti-Shi'ite, who claim to represent their minority's rights in the Iranian southeast province of Sistan-Balochistan.

Their hideout is cross-border, in Pakistani Balochistan. Islamabad has also established they have operating ties with both the ultra-sectarian Lashkar-e-Jhangvi and the Tehreek-e Taliban Pakistan. Tehran directly blames Jundallah for a series of cross-border guerrilla operations that have been going on since 2003, killing mostly Iranian soldiers and border guards.

After the bombing, the diplomatic dance could not but step into overdrive. Islamabad insists it is aligned with Tehran in their regional brand of the war on terror. But Tehran, not beating around the bush, has now explicitly demanded Islamabad to hand over Jundallah supremo Rigi, who is based in Balochistan. Pakistan's Interior Ministry has promised, on the record, to "hunt down" Jundallah.

Although still condemning the Zahedan bombing, the Pakistani Foreign Ministry strangely denies that Iran had sealed off its border with Pakistan. The fact is Tehran did close what they call "the zero point" at the tiny town of Taftan, in the Pakistan-Iran border. Bilateral trade is crucial for the tribal, regional livelihood - after all they are all Baloch "cousins". All the food for the Pakistani Baloch side comes from Iran.

Crucially, Islamabad's tune also has begun to change, in tandem with Tehran, drifting to the "third party" gambit - a foreign player supporting Jundallah's cross-border destabilization campaign, which sabotages any Pakistan-Iran rapprochement and of course the IP.

One does not need to share Tehran's national security worries to identify this foreign player: Washington, which not by accident supports a rival pipeline to IP, the ever-troubled Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline, the raison d'etre for the US involvement in Afghanistan. Iranian Foreign Minister Manouchehr Mottaki said as much, "We consider Rigi's network linked with some foreign forces in Afghanistan." And he added Iran had plenty of "evidence".

Both Washington and Islamabad have tended to ignore Jundallah's anti-Iran activities. Well, not really, because under the George W Bush-era Jundallah was co-opted by US intelligence for regime change purposes in Iran. As for the Pakistani angle, will the Pakistani Inter-Services Intelligence (ISI) finally move against Jundallah, as it seems to be moving against Baitullah Mehsud's Taliban? In principle, this should be a no-brainer; according to the Fars News Agency, the chief of the Iranian Armed Forces, General Hassan Firouzabadi, informed Islamabad of Rigi's exact location.

At a Monday seminar in Quetta, the capital of Pakistani Balochistan, organized by the Awami National Party, influential Balochis made clear they would not allow for Taliban and al-Qaeda to thrive in Balochistan, and they urged Pashtuns living in the province to do the same. One has to wonder whether this show of unity against terrorist tactics applies to the Iranian Balochis of Jundallah as well.

It gets much more complicated. Balochistan has been flooded by Pashtun refugees for 30 years (the break-up of the province is now roughly 50/50). Many have been cannon fodder not only for the 1980s jihad in Afghanistan but also for the jihad in Kashmir and of course for the Taliban, in Afghanistan during the 1990s and lately the Pakistani Taliban. Secular Balochis charge that Punjabi-based Islamabad has always encouraged this refugee wave to bolster its own agenda: to undermine secular Baloch nationalism.

So, what is now happening in the Pashtun North-West Frontier Province and the Federally Administered Tribal Areas because of the Pakistani army onslaught - a powerful sense of alienation - has already happened in Balochistan. Islamabad now has to confront not only Baloch nationalism but Pashtun nationalism as well.

All-out shadow war

With or without using Jundallah for its own Iran-destabilizing agenda, Washington's "shadow war" is about to hit Balochistan full speed ahead. It will mirror an already ongoing shadow war - which is the ISI war against Baloch nationalists; as Balochistan is virtually controlled by Islamabad's intelligence agencies, Islamabad cannot but systematically turn Balochis into victims of "targeted assassinations". For Islamabad, ethnic-based separatism is - in echoes of Israel - an "existential threat". Islamabad's reckless actions have only managed to turn it into a self-fulfilling prophecy.

Instead of watching him meet that paragon of democracy, Saudi Arabia's King Abdullah, and cozy up with perennial Egyptian dictator Hosni Mubarak, the "Muslim world" would rather benefit from Obama explaining first-hand what a shadow war in Muslim lands is all about.

By mid-summer, Obama's Afghan surge in troops will be in position. A new, US mega-base in the "desert of death" in Helmand province, in southern Afghanistan, will be operational. The base happens to be a stone's throw from the Iran-Afghan border, and just across the border from Pakistani Balochistan. It's the ideal, strategic base for an extended, tri-border (Iran, Afghanistan, Pakistan) General David Petraeus-coined counter-insurgency splash.

Ultra-shadowy task forces, "Hell from above" drone war, Hellfire missiles, the merciless logic of privatization and "covertization" of war, the Pentagon's "secret operational capabilities" to "locate, target and kill key individuals in extremist groups" - all this cannot but fester in this tri-border area.

Philip Alston of the United Nations Human Rights Council has been an almost isolated voice denouncing US shadow, "targeted assassination" teams working out of Afghan bases in Kandahar and Nangarhar, and allied with wily, local militias. The victims are mostly Afghan civilians. In Balochistan, the available "local militia" will always be Jundallah. The base will be in the Afghan "desert of death". In the absence of Taliban or al-Qaeda, victims of "decapitation" are plenty of Iranians across the border.

How better to apply Petraeus' tactics than to expand these teams into destabilizing Iran and preventing Iran and Pakistan from closer integration via a key Pipelineistan node - an integration that also benefits China?

That is achievable with a Balochistan mired in chaos. From the Pentagon's point of view, China profiting from the Baloch port of Gwadar to be supplied with Iranian gas is anathema. Islamabad may not be allowed by Washington to take out Jundallah after all.

Shadowplay rules.

.....

Pepe Escobar is the author of Globalistan: How the Globalized World is Dissolving into Liquid War (Nimble Books, 2007) and Red Zone Blues: a snapshot of Baghdad during the surge. 

A Rough Drive With the Hummer

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Andrew Peaple
June 3, 2009 - The Wall Street Journal

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The idea of an obscure Chinese heavy equipment maker buying up Hummer is entertainingly left field for most onlookers.

Chinese government officials will likely be tearing their hair out.

For sure, Beijing is keen for Chinese companies to expand overseas. But they're also hoping for some common sense.

Vice Premier Wang Qishan recently railed against Chinese acquisitions made by managements with little overseas experience, in markets where they don't understand labor relations or even the language.

Yet here is Sichuan Tengzhong Heavy Industrial Machinery – a company whose key overseas markets are Vietnam, Pakistan, and Bangladesh, and whose management speaks little English – venturing to turn around a struggling American icon.

Having a Chinese company bid for the mother of all gas-guzzling car manufacturers isn't exactly a snug fit with Beijing's efforts to promote a more environmentally friendly image for the country.

Those familiar with the so-far unheralded Sichuan Tengzhong point to its decent track record in manufacturing a variety of industrial products, having steadily accumulated businesses in China.

The bid for Hummer, it's said, has been carefully considered, with due attention to cultural differences: The Chinese company will leave Hummer management in place, treating the deal almost like a private equity investment.

That's as it may be. But the track record of cross-border auto sector deals, especially in niche markets like the Hummer, isn't great.

Tata Motor's travails with Land Rover and Jaguar spring to mind as recent less-than-favorable examples. Hummer's market even in the U.S. is fading fast, with sales halving last year.

Sichuan Tengzhong's bet is that the market can recover: the Hummer may seem antediluvian these days, but there may be enough takers when the economy recovers.

In financial terms, this is a small deal, even at the upper end of the estimated $500 million price tag.

But it's a deal rich with symbolism. That won't have escaped the Chinese leadership – the pressure is truly on Sichuan Tengzhong to make this deal a success.

Dollar's fate written in history

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John Lee
Jun 4, 2009 - Asia Times
 
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Debt-based monetary systems are inherently unstable. Money is created out of thin air by the banks and lent to government, consumers and businesses. In order to service and repay those debts, the borrowers take on more debts. Asset prices are inflated, and the vicious cycle continues until the debtors are unable to borrow or the banks are unwilling to lend.

At that point the system snaps, everything is sold off, and we have a financial crisis at hand. Here, we examine what happens to equity and currency markets in the aftermath of financial crisis and deduce what will be the likely outcome for the United States as it emerges from the present crisis.

1998: Russia

Declining productivity, an artificially high fixed exchange rate between the rouble and foreign currencies to avoid public turmoil, and a chronic fiscal deficit were the background to Russia's financial meltdown in 1998. The estimated US$5.5 billion economic cost of the first war in Chechnya was also a cause.

Prior to the culmination of the economic crisis, the government-issued GKO bonds in a policy that has been described as similar to a Ponzi scheme, with the interest on matured obligations being paid off using the proceeds of newly issued obligations.

Two external shocks, the Asian financial crisis that had begun in 1997 and the following declines in demand for (and thus price of) crude oil and nonferrous metals, had a negative impact on Russian foreign exchange reserves. A political crisis came to a head in March when Russian president Boris Yeltsin dismissed prime minister Viktor Chernomyrdin and his entire cabinet in March.

The Asian crisis and related political events rattled investor confidence, caused foreign investors to sell off Russian stocks, bonds, and get out of roubles.

The amount of money involved in GKO bonds, at some $150 billion, was not a cause of concern for a $1 trillion economy. But with more than 30% of GKO bonds owned by foreigners, the foreign selloff caused havoc in equities, bonds and the rouble. The Russian broad equity index crashed by more than 90% from late 1997 to October 1998, and the rouble went from five roubles per US dollar to 30 per dollar in June 1999.

After the equity panic bottom was pressed in October 1998, the Russian equity index, measured in roubles, rebounded strongly in part thanks to the depreciating national currency. However, measured in US dollars, Russian stocks didn't make a full recovery until some five years later.

2001: Argentina

In 1998, Argentina officially entered a recession that lasted for three years and ended in a collapse as fears of the devaluation of the peso led to bank runs. This led to heightened protests and violence affecting many people and companies, causing several deaths.

In 2001, Argentina had $100 billion of national debt, which was about 40% of its gross domestic product. While the amount was containable relative to its GDP, the Argentineans made a mistake of denominating its debt in US dollars. With a shrinking current account surplus, the country wasn't able to raise dollars to pay debt principal and interest in 2001 and eventually repudiated on the foreign debts. The fixed exchange rate was removed and the peso was quickly devalued. The exchange rate was then left to float, causing further devaluation. The peso went from parity with the US dollar to four per dollar in early 2002.

The Argentine equity index plummeted 60% in 2001, and although it recovered fully in 2002 in nominal terms, it wasn't until 2004 that stocks come back to their pre-crisis level in US dollar terms.

Today: USA

The US has just experienced the biggest debt blowup known to man. Mortgages debts worth more than $1 trillion had to be bailed out. Lehman Brothers, Merrill Lynch, Bear Stearns, Countrywide, Fannie Mae and Freddie Mac have all become history. Even the iconic Citibank was brought to its knees and a stock price of $1 before the government bailout. The S&P 500 index halved in 12 months.

The US is privileged to have its dollars serving as the world's reserve currency. America's debt is denominated in dollars, which can be printed at will by the Federal Reserve - and print is what the Fed did, and continues to do, creating more than $1.5 trillion to bail out various groups.

The S&P 500 responded positively to monetary easing, rising 40% since March in nominal terms. It shouldn't be surprising to see the index recover to its pre-crisis level. Equities have to rise as in the cases of Russia and Argentina, when currencies had been massively devalued.

In real terms, however, when S&P 500 is measured in gold terms, it will likely take many years before the index recovers.

Where does the dollar go from here? When foreign investors took flight from Russian rubles and Argentine pesos, the dollar was the beneficiary. When global investors take flight from the dollar, which currency benefits?

Gold is the ultimate antithesis to the dollar. Gold is liquid, universally recognized and limited in quantity. Just like Russians and Argentines trying to anchor their currencies to the dollar, the US government devised various ways to slow down the rise of gold prices to maintain the dollar's soundness. However the massive money printing by the Fed and fast-eroding confidence in the dollar by international investors might just be the key to drive gold past the ellusive $1,000 per ounce level and not look back.

As we saw in the past crises in Russia and Argentina, and also in Thailand and Brazil, equity markets eventually do return to former levels while the devalued currency never regains its former strength. The US case will be no different.

A further rebound by the equity market in nominal terms can be seen albeit with extreme volatility, and we will likely witness a four-digit gold price this year. As the Chinese saying goes, crisis is spelled "danger" and "opportunity". There is still time to diversify out of dollars before the world recognizes the currency's permanent debasement and demotion of status.

.....

John Lee is the founder and principal of Mau Capital Management and the portfolio manager of a mining equity hedge fund. He is a CFA charter holder and has degrees in economics and engineering from Rice University. Lee has a keen interest in the history of money and economics, and has previously studied under James Turk, a renowned authority on the gold market.

US core no longer the magnet

.....

Doug Noland
Jun 2, 2009 - Asia Times

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Last week provided ample confirmation for the global reflation thesis. The dollar index dropped another 0.9%. Gold surged US$22 to $979. Crude oil jumped $4.67 to a six-month high, posting the largest one-month percentage gain since 1999 (according to Bloomberg). The Goldman Sachs Commodities index rallied 5.5% to an almost seven-month high (up 27% year-to-date). Emerging markets remain on fire. And the Baltic Dry Index rose again on Friday, increasing its streak of consecutive gains to 19.

Leading the "BRIC" sweepstakes, Russia's RTS equities index jumped 7.3% last week, while India's Sensex rose 5.3%. Russian stocks are now up 72% year-to-date, followed by India's 52%, China's 45%, and Brazil's 42%. Elsewhere, stocks in Taiwan are up 50%, South Korea 24%, Argentina 47%, and Hungary 22%. The "commodity" currencies led the charge again last week. The South African rand gained 4.1%, the New Zealand dollar 3.3%, the Brazilian real 3.0%, the Australian dollar 2.4%, and the Canadian dollar 2.7%.

It was quite a week in US interest rate markets. Ten-year Treasury yields jumped 29 basis points (bps) during the shortened week's first two trading sessions (to 3.74%), before backing off to end the week up only 2 bps to 3.47%. The mortgage marketplace turned rather tumultuous, with benchmark Fannie Mae mortgage-backed security (MBS) yields spiking 55 bps from last Friday's close before ending the week 19 bps higher at 4.33%.

Some interest-rate hedging markets seemed in disarray, with the dollar swaps market demonstrating price discontinuity. After closing last week at 14.4 bps, the 10-year dollar swap spread traded as high as 38.25 before ending the week at 19.50.

Importantly, at least for the week, mortgage-related market tumult didn't broaden to other risk markets. Corporate credit spreads were mostly narrower on the week, even as the company debt issuance boom ran unabated. The junk-bond market enjoyed another week of strong fund inflows more than matched by huge issuance.

It is also worth noting the resilience of the "emerging" debt markets. Brazilian benchmark dollar bond yields were down 14 bps to 5.86%. Mexican dollar bond yields fell 14 bps to 5.74%. Brazil's credit default swap (CDS) prices declined to the lowest level since early October (197 bps, down from the October high of 600 bps). It is no longer the case that when the Treasury market catches a cold others get really sick.

At this point, the markets' sanguine attitude toward US dollar and Treasury/MBS weakness is understandable. From a global perspective, a weaker dollar bolsters the inflationary bias that had prior to the credit meltdown been driving robust economic performance throughout the energy and commodities-based economies. Dollar devaluation also works to reinforce already heady financial flows to "emerging" markets and non-dollar assets more generally. There are facets of inflation that seductively salve recovery.

The dramatic loosening of financial conditions globally is supporting an improvement in economic conditions. The optimists are looking for Asia and the developing world to lead a global recovery, and a sinking dollar on a short-term basis would seem to support such a scenario. Our weak currency also empowers the global government finance bubble. Amazingly, most countries today have unprecedented flexibility to issue debt without fear of negative market reaction or a run against their currencies.

I again want to emphasize the dramatic change in circumstances that is increasingly in view throughout global markets and economies. During the 1990s - and stretching through the "King Dollar" period earlier this decade - there was an overarching inflationary bias that worked to direct flows to the "core" (the US credit system and securities markets). Whether it was a crisis that initially erupted in Mexico, Southeast Asia, Russia, Argentine or Brazil, the immediate market response was an abrupt reversal of financial flows from the developing countries to US dollar securities. While there was an ongoing acceleration in speculative flows meandering about the globe in search of big returns, the first sign of trouble would incite a panic straight to the dollar.

The "core" absolutely dominated the system, providing our policymakers (especially the US Federal Reserve) extraordinary latitude. The periphery-to-core bias fostered financial crises, along with general periphery financial and economic instability. This dynamic worked to keep global inflationary pressures in check. Or, better said, the nature of the inflationary flow of finance kept inflation pressures directed to US dollar securities markets - as opposed to energy, commodities and more traditional inflation.

The global financial and economic backdrop has changed profoundly. Today, there exists a powerful inflationary bias working to direct flows away from the core out to the periphery. This dynamic helps to explain the dramatic change in the cost and availability of finance for the developed world over the past several years - the virtually unlimited cheap finance that funded historic booms in China and Asia.

Granted, this flow was abruptly interrupted by last year's global credit crisis. It is, however, my view that the dynamic of powerful core-to-periphery flows has resumed. Moreover, it is the nature of this type of dynamic that if such a trend recovers it will likely resume stronger-than-ever (think tech stock reflation post the Long Term Capital Management collapse or mortgages reflation post the tech bubble). This analysis is supported by the periphery's recent dramatic economic and market outperformance relative to the core.

So, is this bullish or bearish? Well, I believe the core-to-periphery dynamic is supportive of a more rapid than expected global economic recovery. I definitely expect global inflation to surprise on the upside. Adherents to the global deflationary spiral thesis may be left wondering what the heck happened. The backdrop seems to be set for surprising revival in energy and commodities markets. And I would not be surprised if the global equities rally has some legs.

Yet I view the core-to-periphery dynamic as profoundly bearish for the US. At its core, this historic redirection of global flows and inflationary pressures is the consequence of a breakdown in the dollar standard. Failed policies, a resulting deeply impaired economic structure, and massive ongoing devaluation have ended the dollar's reign as the globe's premier reserve currency and perceived stable store of value. There is today no sound currency to replace the dollar, so the global financial system operates rudderless and with great uncertainties.

It is more certain, however, that the great benefits commanded to our economy and markets over the decades from governing the world's reserve currency are drawing to an end. Our policymakers still believe they can inflate credit and manipulate interest rates - and not have to pay a price for it. But the new global reality may be that currency markets will protest against massive US fiscal deficits and activist monetary policy, while global markets come to dictate US market yields. Over the past two weeks, we have seen the dollar and US Treasuries/MBS come under significant pressure. Is this the beginning of global markets disciplining Washington?

A robust core-to-periphery dynamic and the re-emergence of dollar vulnerability are a potent combination. US markets to this point remain sanguine with the prospect of an expanding Federal Reserve balance sheet rectifying any spike in interest rates. But currency markets are no doubt increasingly fixated on our propensity to monetize current and prospective stimulus.

At some point, increasingly unwieldy flows out of our currency may force the Fed's hand. The scenario where the Fed is forced to choose between loose monetary policy and currency crisis sits out there as a potential big negative surprise for US markets.

Wednesday, June 3, 2009

Zen Moment of the Day

BOY, it stinks to be Bernie Madoff's sons.

Andrew and Mark Madoff -- who claim to know nothing of their dad's Ponzi scheme despite having made millions working in the family business -- are portrayed in a new Vanity Fair piece as feeling deeply betrayed by Bernie, whom "they were always trying to please, but never could."

David Margolick, who spoke to people close to the brothers Madoff, writes:

* Andrew recently "lamented" to an African-American friend, "I'm unemployed, I don't have any money, and I'm just trying to stay out of jail -- my name is mud," to which the friend replied, "Well, now you're just like every black man in America."

* Andrew's fiancée, Catherine Hooper, gave him a card on his birthday in April that said, "Hope you have a fun day doing all the things people in prison wish they could do." Andrew told her, "I wish I had my parents back," and she retorted, "Yeah, they were a really nice idea."

* When Andrew's estranged wife, Deborah, orders groceries from FreshDirect, she uses her maiden name. For the same reason, Andrew and Hooper use her last name when they make restaurant reservations.

* Parents of classmates of Andrew's daughters, who attend Dalton, are worried about letting their kids attend parties at his house because they are "evidently fearful of assassins crouching in vestibules."

* Although the Wilpon family, which owns the Mets, lost hundreds of millions on Bernie Madoff's schemes, Jeff Wilpon has maintained his long-standing ties to Mark Madoff. But a Wilpon-family friend says "Jeff has tired of Mark's excessive self-pity."

* Andrew and Mark don't speak to their mom, Ruth, "not because they think she was involved [they don't] but because they believe her tendency to side with [Bernie], no matter what, when they complained to her about him, enabled his dirty deeds."

- June 3, 2009 - New York Post

Tillman's Mother Says General Lied Again About His Death

Pat Tillman died in Afghanistan in 2004 after giving up a lucrative NFL career to serve in the Army.

.....

June 3, 2009 - CNN

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The latest explanation for why Pat Tillman's Silver Star citation failed to mention that friendly fire killed the former NFL star in Afghanistan is another lie by the U.S. military, Tillman's mother said Tuesday.

Mary Tillman was responding to remarks made Tuesday by the general nominated to lead Allied forces in Afghanistan, who apologized before a Senate committee for his role in the matter.

Lt. Gen. Stanley McChrystal told the Senate Armed Services Committee that he helped expedite the Silver Star award for Tillman before confirming that the Army corporal was killed by friendly fire in 2004.

Tillman's family has long complained that the memorial service, which included the Silver Star presentation, deliberately avoided mention of fratricide.

McChrystal acknowledged the problem Tuesday, calling it a mistake. He said the Silver Star citation was "not well-written" but denied any intent to mislead.

"I didn't see any activity by anyone to deceive," he said.

Mary Tillman said McChrystal knew at the memorial service that her son died from friendly fire.

"McChrystal was lying," she said of his comments Tuesday. "He said he didn't know for certain Pat was killed by fratricide. That isn't true in and of itself, but the fact is, it doesn't matter whether he knew it for certain."

Army protocol at the time required families to be told of possible fratricide, whether or not it had been confirmed, she said.

She also criticized Sen. John McCain of Arizona, the ranking Republican on the committee, who questioned McChrystal on Tuesday, for "playing dumb" by not following up on McChrystal's explanation.
Don't Miss

* McChrystal says minimizing casualties is crucial
* McChrystal's covert career could be questioned

"If the Army chain of command didn't know what happened to Pat, why did it present us with a false story" at the memorial service? Tillman asked. "That is not an error; that is not a misstep; that is deliberate deception. McCain was at Pat's service. He was read a false narrative like the rest of us. Where is his outrage? Did he know all along?"

Investigations by the Army's Criminal Investigations Division and the Defense Department's inspector general concluded that officers in Tillman's chain of command knew almost immediately that he had been killed by fire from his own platoon. That information, however, was withheld from his family for more than a month, in violation of Army regulations.

McChrystal, one of four generals identified in the report, was later cleared in the investigation but was faulted for not immediately notifying Tillman's family of suspicions that it was a friendly fire incident.

On Tuesday, McChrystal said the mistake in the Tillman situation involved attempts to simultaneously support the awarding of a Silver Star while investigating the reports that he died from friendly fire.

A policy to have awards approved in time to present them to families at memorial ceremonies should be changed to prevent competing pressures, McChrystal said.

"I would do this differently if I had the chance again," he said.

Asked whether he believed that Tillman earned the Silver Star before his death, McChrystal said: "I did then; I do now. ... I don't believe that the circumstance of death detracts from the courage and commitment of his contribution."

Later, Sen. Jim Webb, D-Virginia, pressed McChrystal harder on the issue, prompting the general to agree that the Army had failed the Tillman family.

"I was a part of that, and I apologize for it," McChrystal said.

Ronald Reagan: Worst President Ever?

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There's been talk that George W. Bush was so inept that he should trademark the phrase "Worst President Ever," though some historians would bestow that title on pre-Civil War President James Buchanan. Still, a case could be made for putting Ronald Reagan in the competition.

Robert Parry
June 3, 2009 - Consortiumnews.com

.....

Granted, the very idea of rating Reagan as one of the worst presidents ever will infuriate his many right-wing acolytes and offend Washington insiders who have made a cottage industry out of buying some protection from Republicans by lauding the 40th President.

But there's a growing realization that the starting point for many of the catastrophes confronting the United States today can be traced to Reagan's presidency. There's also a grudging reassessment that the "failed" presidents of the 1970s – Richard Nixon, Gerald Ford and Jimmy Carter – may deserve more credit for trying to grapple with the problems that now beset the country.

Nixon, Ford and Carter won scant praise for addressing the systemic challenges of America's oil dependence, environmental degradation, the arms race, and nuclear proliferation – all issues that Reagan essentially ignored and that now threaten the America's future.

Nixon helped create the Environmental Protection Agency; he imposed energy-conservation measures; he opened the diplomatic door to communist China. Nixon's administration also detected the growing weakness in the Soviet Union and advocated a policy of détente (a plan for bringing the Cold War to an end or at least curbing its most dangerous excesses).

After Nixon's resignation in the Watergate scandal, Ford continued many of Nixon's policies, particularly trying to wind down the Cold War with Moscow. However, confronting a rebellion from Reagan's Republican Right in 1976, Ford abandoned "détente."

Ford also let hard-line Cold Warriors (and a first wave of young intellectuals who became known as neoconservatives) pressure the CIA's analytical division, and he brought in a new generation of hard-liners, including Dick Cheney and Donald Rumsfeld.

After defeating Ford in 1976, Carter injected more respect for human rights into U.S. foreign policy, a move some scholars believe put an important nail in the coffin of the Soviet Union, leaving it hard-pressed to justify the repressive internal practices of the East Bloc. Carter also emphasized the need to contain the spread of nuclear weapons, especially in unstable countries like Pakistan.

Domestically, Carter pushed a comprehensive energy policy and warned Americans that their growing dependence on foreign oil represented a national security threat, what he famously called "the moral equivalent of war."

However, powerful vested interests – both domestic and foreign – managed to exploit the shortcomings of these three presidents to sabotage any sustained progress. By 1980, Reagan had become a pied piper luring the American people away from the tough choices that Nixon, Ford and Carter had defined.

Cruelty with a Smile

With his superficially sunny disposition – and a ruthless political strategy of exploiting white-male resentments – Reagan convinced millions of Americans that the threats they faced were: African-American welfare queens, Central American leftists, a rapidly expanding Evil Empire based in Moscow, and the do-good federal government.

In his First Inaugural Address in 1981, Reagan declared that "government is not the solution to our problem; government is the problem."

When it came to cutting back on America's energy use, Reagan's message could be boiled down to the old Bob Marley lyric, "Don't worry, be happy." Rather than pressing Detroit to build smaller, fuel-efficient cars, Reagan made clear that the auto industry could manufacture gas-guzzlers without much nagging from Washington.

The same with the environment. Reagan intentionally staffed the Environmental Protection Agency and the Interior Department with officials who were hostile toward regulation aimed at protecting the environment. George W. Bush didn't invent Republican hostility toward scientific warnings of environmental calamities; he was just picking up where Reagan left off.

Reagan pushed for deregulation of industries, including banking; he slashed income taxes for the wealthiest Americans in an experiment known as "supply side" economics, which held falsely that cutting rates for the rich would increase revenues and eliminate the federal deficit.

Over the years, "supply side" would evolve into a secular religion for many on the Right, but Reagan's budget director David Stockman once blurted out the truth, that it would lead to red ink "as far as the eye could see."

While conceding that some of Reagan's economic plans did not work out as intended, his defenders – including many mainstream journalists – still argue that Reagan should be hailed as a great President because he "won the Cold War," a short-hand phrase that they like to attach to his historical biography.

However, a strong case can be made that the Cold War was won well before Reagan arrived in the White House. Indeed, in the 1970s, it was a common perception in the U.S. intelligence community that the Cold War between the United States and the Soviet Union was winding down, in large part because the Soviet economic model had failed in the technological race with the West.

That was the view of many Kremlinologists in the CIA's analytical division. Also, I I was told by a senior CIA's operations official that some of the CIA's best spies inside the Soviet hierarchy supported the view that the Soviet Union was headed toward collapse, not surging toward world supremacy, as Reagan and his foreign policy team insisted in the early 1980s.

The CIA analysis was the basis for the détente that was launched by Nixon and Ford, essentially seeking a negotiated solution to the most dangerous remaining aspects of the Cold War.

The Afghan Debacle

In that view, Soviet military operations, including sending troops into Afghanistan in 1979, were mostly defensive in nature. In Afghanistan, the Soviets hoped to prop up a pro-communist government that was seeking to modernize the country but was beset by opposition from Islamic fundamentalists who were getting covert support from the U.S. government.

Though the Afghan covert operation originated with Cold Warriors in the Carter administration, especially national security adviser Zbigniew Brzezinski, the war was dramatically ramped up under Reagan, who traded U.S. acquiescence toward Pakistan's nuclear bomb for its help in shipping sophisticated weapons to the Afghan jihadists (including a young Saudi named Osama bin Laden).

While Reagan's acolytes cite the Soviet defeat in Afghanistan as decisive in "winning the Cold War," the counter-argument is that Moscow was already in disarray – and while failure in Afghanistan may have sped the Soviet Union's final collapse – it also created twin dangers for the future of the world: the rise of al-Qaeda terrorism and the nuclear bomb in the hands of Pakistan's unstable Islamic Republic.

Trade-offs elsewhere in the world also damaged long-term U.S. interests. In Latin America, for instance, Reagan's brutal strategy of arming right-wing militaries to crush peasant, student and labor uprisings left the region with a legacy of anti-Americanism that is now resurfacing in the emergence of populist leftist governments.

In Nicaragua, for instance, Sandinista leader Daniel Ortega (whom Reagan once denounced as a "dictator in designer glasses") is now back in power. In El Salvador, the leftist FMLN won the latest elections. Indeed, across the region, hostility to Washington is now the rule, creating openings for China, Iran, Cuba and other American rivals.

In the early 1980s, Reagan also credentialed a young generation of neocon intellectuals, who pioneered a concept called "perception management," the shaping of how Americans saw, understood and were frightened by threats from abroad.

Many honest reporters saw their careers damaged when they resisted the lies and distortions of the Reagan administration. Likewise, U.S. intelligence analysts were purged when they refused to bend to the propaganda demands from above.

To marginalize dissent, Reagan and his subordinates stoked anger toward anyone who challenged the era's feel-good optimism. Skeptics were not just honorable critics, they were un-American defeatists or – in Jeane Kirkpatrick's memorable attack line – they would "blame America first."

Under Reagan, a right-wing infrastructure also took shape, linking media outlets (magazines, newspapers, books, etc.) with well-financed think tanks that churned out endless op-eds and research papers. Plus, there were attack groups that went after mainstream journalists who dared disclose information that poked holes in Reagan's propaganda themes.

In effect, Reagan's team created a faux reality for the American public. Civil wars in Central America between impoverished peasants and wealthy oligarchs became East-West showdowns. U.S.-backed insurgents in Nicaragua, Angola and Afghanistan were transformed from corrupt, brutal (often drug-tainted) thugs into noble "freedom-fighters."

With the Iran-Contra scandal, Reagan also revived Richard Nixon's theory of an imperial presidency that could ignore the nation's laws and evade accountability through criminal cover-ups. That behavior also would rear its head again in the war crimes of George W. Bush. [For details on Reagan's abuses, see Robert Parry's Lost History and Secrecy & Privilege.]

Wall Street Greed

The American Dream also dimmed during Reagan's tenure.

While he played the role of the nation's kindly grandfather, his operatives divided the American people, using "wedge issues" to deepen grievances especially of white men who were encouraged to see themselves as victims of "reverse discrimination" and "political correctness."

Yet even as working-class white men were rallying to the Republican banner (as so-called "Reagan Democrats"), their economic interests were being savaged. Unions were broken and marginalized; "free trade" policies shipped manufacturing jobs abroad; old neighborhoods were decaying; drug use among the young was soaring.

Meanwhile, unprecedented greed was unleashed on Wall Street, fraying old-fashioned bonds between company owners and employees.

Before Reagan, corporate CEOs earned less than 50 times the salary of an average worker. By the end of the Reagan-Bush-I administrations in 1993, the average CEO salary was more than 100 times that of a typical worker. (At the end of the Bush-II administration, that CEO-salary figure was more than 250 times that of an average worker.)

Many other trends set during the Reagan era continued to corrode the U.S. political process in the years after Reagan left office. After 9/11, for instance, the neocons reemerged as a dominant force, reprising their "perception management" tactics, depicting the "war on terror" – like the last days of the Cold War – as a terrifying conflict between good and evil.

The hyping of the Islamic threat mirrored the neocons' exaggerated depiction of the Soviet menace in the 1980s – and again the propaganda strategy worked. Many Americans let their emotions run wild, from the hunger for revenge after 9/11 to the war fever over invading Iraq.

Arguably, the descent into this dark fantasyland – that Ronald Reagan began in the early 1980s – reached its nadir in the flag-waving early days of the Iraq War. Only gradually did reality begin to reassert itself as the death toll mounted in Iraq and the Katrina disaster reminded Americans why they needed an effective government.

Still, the disasters – set in motion by Ronald Reagan – continued to roll in. Bush's Reagan-esque tax cuts for the rich blew another huge hole in the federal budget and the Reagan-esque anti-regulatory fervor led to a massive financial meltdown that threw the nation into economic chaos.

Love Reagan; Hate Bush

Ironically, George W. Bush has come in for savage criticism, but the Republican leader who inspired Bush's presidency – Ronald Reagan – remained an honored figure, his name attached to scores of national landmarks including Washington's National Airport.

Even leading Democrats genuflect to Reagan. Early in Campaign 2008, when Barack Obama was positioning himself as a bipartisan political figure who could appeal to Republicans, he bowed to the Reagan mystique, hailing the GOP icon as a leader who "changed the trajectory of America."

Though Obama's chief point was that Reagan in 1980 "put us on a fundamentally different path" – a point which may be historically undeniable – Obama went further, justifying Reagan's course correction because of "all the excesses of the 1960s and 1970s, and government had grown and grown, but there wasn't much sense of accountability."

While Obama later clarified his point to say he didn't mean to endorse Reagan's conservative policies, Obama seemed to suggest that Reagan's 1980 election administered a needed dose of accountability to the United States when Reagan actually did the opposite. Reagan's presidency represented a dangerous escape from accountability – and reality.

Still, Obama and congressional Democrats continue to pander to the Reagan myth. On Tuesday, as the nation approached the fifth anniversary of Reagan's death, Obama welcomed Nancy Reagan to the White House and signed a law creating a panel to plan and carry out events to honor Reagan's 100th birthday in 2011.

Obama hailed the right-wing icon. "President Reagan helped as much as any President to restore a sense of optimism in our country, a spirit that transcended politics — that transcended even the most heated arguments of the day," Obama said. [For more on Obama's earlier pandering about Reagan, see Consortiumnews.com's "Obama's Dubious Praise for Reagan."]

It's a sure thing that the Reagan Centennial Committee won't do much more than add to the hagiography surrounding the 40th President.

Despite the grievous harm that Reagan's presidency inflicted on the American Republic and the American people, it may take many more years before a historian has the guts to put this deformed era into a truthful perspective and rate Reagan where he belongs -- near the bottom of the presidential list.

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Robert Parry broke many of the Iran-Contra stories in the 1980s for the Associated Press and Newsweek. His latest book, Neck Deep: The Disastrous Presidency of George W. Bush.

Controversial Coal Mining Method Gets Obama's OK

Singer-Actress Ashley Judd speaks during a rally in Frankfort, Ky. on Feb. 17, 2009 calling for an end to mountaintop coal mining. (AP Photo/Roger Alford)

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Tom Hamburger and Peter Wallsten
June 2, 2009 - Chicago Tribune

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With the election of Barack Obama, environmentalists expected to see the end of the "Appalachian apocalypse" -- their name for exposing coal deposits by blowing the tops off of whole mountains.

But in recent weeks, the Obama administration has quietly decided to open the way for at least two dozen more "mountaintop removal" projects.

The decision to clear a path for the controversial projects was never officially announced, but instead conveyed in a letter this month to a West Virginia congressman and coal ally, Democratic Rep. Nick Rahall. The letter said that the Environmental Protection Agency would not block 42 of 48 mine projects that it had reviewed so far, including some of the most controversial mountaintop mines.

In mountaintop removal, explosives blast away a peak and expose coal seams. Coal companies say the practice is safer and more efficient than traditional shaft mining. Critics say the process scars the landscape and dumps tons of waste, some of it toxic, into streams and valleys.

The administration's decisions are not the final word on the projects -- or on the future of mountaintop removal -- but it removes a major obstacle. And the decision, coupled with the light it sheds on relations between the mining industry and the Obama White House, has disappointed environmentalists. Some say they feel betrayed by a president they thought would end or sharply limit the practice.

What makes the issue politically sensitive is the fact that environmentalists were an active force behind Obama's election, while his standing among Democratic voters in coal states is tenuous. Halting mountaintop removal could eliminate jobs in those states and put upward pressure on energy prices.

Coal advocates have solicited help from officials as high as White House chief of staff Rahm Emanuel, and the issue sparked contentious debates among administration officials, including one shouting match in which top officials of two government agencies were heard pounding their fists on the table.

The White House is "searching for a way to walk this tightrope," said Phil Smith, a spokesman for the United Mine Workers of America, whose president, Cecil Roberts, has urged administration officials to allow the procedure. "They have a large constituency of people who want to see an immediate end to mountaintop removal, and an equally large constituency -- many of them Democrats, I might add -- whose communities depend on those jobs."

Earlier, Obama had won praise from the green lobby for taking a skeptical view of the procedure. And the EPA announced in March that it would review mountaintop projects.

The EPA has the authority to review and ultimately block mountaintop removal under the Clean Water Act, but if the agency raises no objections, the final decision is made by the Army Corps of Engineers. The corps previously indicated its intention to approve the 48 permits.

A review of Obama campaign statements showed the presidential candidate expressing concern about the practice without specifically promising to end it. On a West Virginia visit, he said he wanted "strong enforcement of the Clean Water Act" and added, "I will make sure the head of the Environmental Protection Agency believes in the environment."

And EPA Administrator Lisa Jackson said this year that the agency had "considerable concern" about the projects. She pledged that her agency would "use the best science and follow the letter of the law in ensuring we are protecting our environment."

Soon afterward, the agency blocked six major mountaintop projects in West Virginia, Kentucky and Ohio.

But this month, after White House meetings with coal companies and advocates such as Rahall and West Virginia Gov. Joe Manchin, the EPA gave the green light to at least two dozen projects.

"It was a big disappointment," said Joan Mulhern, a lawyer for Earthjustice, an environmental law firm that has led court challenges to mountaintop removal.

Mulhern charged that the EPA "blew off" Jackson's earlier promises that the agency would adhere to science and conduct an open process.

Ed Hopkins, a top Sierra Club official, said that some of the projects that obtained the EPA's blessing "are as large and potentially destructive as the ones they objected to.

"It makes us wonder what standards -- if any -- the administration is using."

Economic Recovery is Wishful Thinking

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The media has been touting whatever good economic news it can find. But the truth is economic recovery is nowhere in sight

Dean Baker
June 2, 2009 - The Guardian/UK

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Last week we got a whole series of bad reports on the state of the economy. New and existing home sales both remain near their lowest level for the downturn, as house prices continue to drop at the rate of 2% a month. New orders for capital goods, a key measure of investment demand, fell by 2% in April. Excluding the volatile transportation sector, new orders were still down by 1.5%.

On Friday, the Chicago Purchasing Managers Index fell by more than 5 percentage points from its April level, approaching its low for the downturn. The employment component of the index did hit a new low.

These reports might have led to gloomy news stories, but not in the US media. The folks who could not see an $8tn housing bubble are still determined to find the silver lining in even the worst economic news.

For example, National Public Radio told listeners that the new home sales figure reported for April was up from the March level. While this was true, the April figure was only 1,000 higher than a March level that had just been revised down by 5,000. April new home sales were 4,000 below the sales level that had originally been reported for March. USA Today touted a "surge" in durable goods orders, which was also based on a sharp downward revision to the prior month's data.

The media have obviously abandoned economic reporting and instead have adopted the role of cheerleader, touting whatever good news it can find and inventing good news when none can be found. This leaves the responsibility of reporting on the economy to others.

Any serious examination of the data shows that recovery is nowhere in sight. The basic story of the downturn is painfully simple. We have seen a collapse of a housing bubble which has devastated the construction sector and also caused consumption to plunge.

The construction sector is suffering from the enormous overbuilding during the bubble years. Measured in months of sales, the inventories of both new and existing homes are close to double their normal levels. This inventory will ensure that construction remains badly depressed at least through 2010, if not much longer.

The plunge in house prices has sent consumption plummeting. The problem is not consumer attitudes, as many commentators seem to believe. Rather, the reason that most homeowners aren't buying a lot right now is the same reason that homeless people don't buy a lot of things: they don't have the money.

The decline in house prices since the peak in 2006 has cost homeowners close to $6tn in lost housing equity. In 2009 alone, falling house prices have destroyed almost $2tn in equity. People were spending at an incredible rate in 2004-2007 based on the wealth they had in their homes. This wealth has now vanished.

Housing is weak and falling. Consumption is weak and falling. New orders for capital goods in April, the main measure for investment demand, is down 35.6% from its level a year ago. And, state and local governments across the country, led by California, are laying off workers and cutting back services.

If there is evidence of a recovery in this story, it is very hard to find. The more obvious story is one of a downward spiral, as more layoffs and further cuts in hours continue to reduce workers' purchasing power. Furthermore, the weakness in the labour market is putting downward pressure on wages, reducing workers' purchasing power through a second channel.

Happy talk will not turn this economy around. The economy needs more demand, which can only be provided by another larger dose of stimulus from the federal government. There are easy, quick and effective ways to boost the economy with additional stimulus.

First, let's give more money to state and local governments so that they don't have to lay off workers, cut back services and raise taxes. This should be a complete no-brainer since this spending will immediately boost the economy.

The government could also provide a large boost to the economy by jump-starting healthcare reform with an employer tax credit (e.g. $2,500 per worker) for firms who do not currently provide coverage. This could quickly get us to near universal coverage as Congress works to restructure the system to contain costs.

It could also provide a $2,500 tax credit to employers for giving workers paid time off. This should both increase demand in the economy and provide workers with more leisure and flexibility at the workplace.

There are other ways in which the government could quickly generate new demand, but these will not be seriously discussed until there is more general recognition that additional stimulus is needed. At some point it will be impossible to conceal the bad news and Congress' attention will return to stimulus. But the media's reality defying happy talk on the economy is delaying this moment.

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Dean Baker is the co-director of the Center for Economic and Policy Research (CEPR). He is the author of The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer (www.conservativenannystate.org) and the more recently published Plunder and Blunder: The Rise and Fall of The Bubble Economy. He also has a blog, "Beat the Press," where he discusses the media's coverage of economic issues. You can find it at the American Prospect's web site.