19:20 (h/t Susie Madrak)

Ben Bernanke, Hippie

By PAUL KRUGMAN

Published: February 28, 2013

We’re just a few weeks away from a milestone I suspect most of Washington would like to forget: the start of the Iraq war. What I remember from that time is the utter impenetrability of the elite prowar consensus. If you tried to point out that the Bush administration was obviously cooking up a bogus case for war, one that didn’t bear even casual scrutiny; if you pointed out that the risks and likely costs of war were huge; well, you were dismissed as ignorant and irresponsible.

It didn’t seem to matter what evidence critics of the rush to war presented: Anyone who opposed the war was, by definition, a foolish hippie. Remarkably, that judgment didn’t change even after everything the war’s critics predicted came true. Those who cheered on this disastrous venture continued to be regarded as “credible” on national security (why is John McCain still a fixture of the Sunday talk shows?), while those who opposed it remained suspect.

And, even more remarkably, a very similar story has played out over the past three years, this time about economic policy. Back then, all the important people decided that an unrelated war was an appropriate response to a terrorist attack; three years ago, they all decided that fiscal austerity was the appropriate response to an economic crisis caused by runaway bankers, with the supposedly imminent danger from budget deficits playing the role once played by Saddam’s alleged weapons of mass destruction.

Now, as then, this consensus has seemed impenetrable to counterarguments, no matter how well grounded in evidence. And now, as then, leaders of the consensus continue to be regarded as credible even though they’ve been wrong about everything (why do people keep treating Alan Simpson as a wise man?), while critics of the consensus are regarded as foolish hippies even though all their predictions – about interest rates, about inflation, about the dire effects of austerity – have come true.

Incestuous Amplification, Economics Edition

Paul Krugman, The New York Times

January 29, 2013, 5:44 pm

Back during the early days of the Iraq debacle, I learned that the military has a term for how highly dubious ideas become not just accepted, but viewed as certainties. “Incestuous amplification” happen when a closed group of people repeat the same things to each other – and when accepting the group’s preconceptions itself becomes a necessary ticket to being in the in-group. A fundamentally flawed notion – say, that the Germans can’t possibly attack though the Ardennes – becomes part of what everyone knows, where “everyone” means by definition only people who accept the flawed notion.

We saw that in the run-up to Iraq, where perfectly obvious propositions – the case for invading is very weak, the occupation may well be a nightmare – weren’t so much rejected as ruled out of discussion altogether; if you even considered those possibilities, you weren’t a serious person, no matter what your credentials.

Which brings me to the fiscal debate, characterized by the particular form of incestuous amplification Greg Sargent calls the Beltway Deficit Feedback Loop. I’ve already blogged about my Morning Joe appearance and Scarborough’s reaction, which was to insist that almost no mainstream economists share my view that deficit fear is vastly overblown. As Joe Weisenthal points out, the reality is that among those who have expressed views very similar to mine are the chief economist of Goldman Sachs; the former Treasury secretary and head of the National Economic Council; the former deputy chairman of the Federal Reserve; and the economics editor of the Financial Times. The point isn’t that these people are necessarily right (although they are), it is that Scarborough’s attempt at argument through authority is easily refuted by even a casual stroll through recent economic punditry.

But these people aren’t part of the in-group, and if they do make it into the in-group’s conversation at all, it’s only by blurring their message sufficiently that the in-group doesn’t understand it.

And at this point, of course, all the Very Serious People have committed their reputations so thoroughly to the official doctrine that they almost literally can’t hear any contrary evidence.

Disastrous Predictions and Predictable Disasters

Paul Krugman, The New York Times

March 1, 2013, 9:53 am

Joe Weisenthal is wrong. He writes that the unfolding economic disaster in Europe is what everyone predicted. Not so. It’s what he predicted, it’s what I predicted, but it’s not at all what many people were predicting. And the people who got it completely wrong happen to be the people still running European economic policy.

…

Readers sometimes complain about my frequent references to the things my friends and I got right, and others got wrong. But look, it’s not ego (or anyway it’s not just ego). Predictions are how you judge between models. If the world delivers results that are very much at odds with what your framework says should have happened, you’re supposed to reconsider your framework – as I did, for example, after I was wrong about interest rates in 2003.

And the fact is that a more or less Keynesian framework – a framework that says that austerity in a depressed economy is a terrible idea – has yielded pretty good predictions through the crisis, while the anti-Keynesian stories that became the conventional wisdom in Brussels and Frankfurt have delivered an awesome record of predictive failure.

This would make much more sense if you were french or spanish or italian.

You know, european.

You cheese eating surrender monkey.

Away from it all.

(h/t Crooks & Liars)

BusinessWeek–

Since 1979, after-tax income grew 277% for the top 1%.  For the bottom fifth, after-tax income grew by only 18%.

Ok, so it’s been obvious for years that Bob Woodward of Watergate fame is nothing but a toady bootlicker of a Versailles Villager but I need a title and talk about jumping the shark!

(h/t Atlantic Wire)

Bob Woodward embodies US political culture in a single outburst

Glenn Greenwald, The Guardian

Thursday 28 February 2013 07.57 EST

How ironic that this comes from the reporter endlessly heralded for having brought down Richard Nixon’s presidency on the ground that Nixon believed himself above the law. Nixon’s hallmark proclamation – “When the President does it, that means it is not illegal” – is also apparently Bob Woodward’s.

All of this, of course, is pure pretense. Is it even remotely plausible that Obama is refraining from engaging in military action he believes is necessary out of some sort of quaint deference to the law? Please. This is a president who continued to wage war, in Libya, not merely without Congressional authorization, but even after Congress expressly voted against its authorization. This is a president who has repeatedly argued that he has the right to kill anyone he wants, anywhere in the world, not only due to Congressional authorization but also his own Commander-in-Chief powers. If Obama really wanted to deploy that second aircraft carrier, he would do so, knowing that journalists like Bob Woodward and members of both parties would cheer him. This is just a flamboyant political stunt designed to dramatize how those Big, Bad Republicans are leaving us all exposed and vulnerable with sequestration cuts.

But whatever Obama’s motives might be, the fact is that what we call “law” really does require some cuts in military spending. To refuse to do so would be to assert powers not even most monarchs have: to break the law at will. Woodward is right about one point: not only would prior presidents have been willing to do this, this is exactly what they did. Indeed, George Bush’s entire presidency was explicitly predicated on the theory that the president has the power to break the law at will whenever he deems that doing so promotes national security. That America’s most celebrated journalist not only supports this, but demands that all presidents follow this model of lawlessness, is telling indeed.

…

Bob Woodward, with one rant, expressing the core values of America’s media class. The president is not constrained by law (contemptuously referred to as “this piece of paper”). He not only has the right but the duty to do anything – even if the law prohibits it – to project military force whenever he wants (even though the Constitution mandates as his prime duty not to Keep Us Safe but rather that he “shall take care that the laws be faithfully executed” and thus must swear as his oath “to the best of [his] ability [to] preserve, protect, and defend the Constitution of the United States”). The US must act as empire, dominating the world with superior military force if it wants to stay safe. Any reduction in military spending and deployment will endanger us all.

It’s to be expected that these authoritarian and militaristic values shape political leaders and their followers. That these values also shape the “watchdog” media class, as embodied by one of their “legends”, explains much about US political culture generally.

Bob Woodward fulfills an important function. Just as Tim Russert was long held up as the scary bulldog questioner who proved the existence of an adversarial TV press while the reality was that, as Harper’s Lewis Lapham famously put it, he maintained “the on-air persona of an attentive and accommodating headwaiter”, the decades-old Woodward lore plays a critical role in maintaining the fiction of a watchdog press corps even though he is one of the most faithful servants of the war machine and the national security and surveillance states.

Washington Numbers.

Well, if you’ve been following the news, it’s really kind of obvious that this was going to happen.

The Shell high tech, best in the industry effort is basically 1 Ship, 1 Rig, and a Barge.

The ship is the Noble Discoverer, an obsolete hunk of junk with barely the power to get out of its own stink when the engines are working which they seldom do.  They couldn’t even muster enough steam to get it out of the way of Alaskan property taxes.

The Coast Guard found a lack of preventive maintenance and “systematic failure” led the Discoverer to experience a loss of its propulsion system and an explosion in its exhaust system.

…

The Coast Guard reportedly found that the Discoverer is not able to maintain sufficient speed at sea to maneuver safely in all conditions without a tow; multiple dead end wires and improper wire splices in the engine room; main engine cooling water contaminated with oil and sludge.

In addition, the vessel experienced an abnormal propeller shaft vibration on the way back from the Arctic in November, requiring the crew to shut down the vessel’s main engines and have the rig towed to the Port of Seward.

Oh, and it catches fire all the time too.

The Coast Guard inquiry began after the ship had propulsion problems while pulling into Seward, Alaska last November. Earlier that month, a fire broke out in the rig stack on the vessel while it was in Dutch Harbor, Alaska. It was swiftly put out by personnel on board the Discoverer and no one was injured.

After exploding in flame in Dutch Harbor, missing the January 1st property tax deadline, and collecting 16 major Coast Guard citations for safety violations the ship is being floating drydocked to South Korea for repair since it’s too unseaworthy to sail there on its own.  It won’t arrive until late spring to say nothing of the time needed for repair (unless they determine that it’s fit only for razor blades).

Then there is the Kulluk which when last we checked was doing a pretty good job of grinding itself to razors near Kodiak after it broke it’s tow.  It’s headed to South Korea too though it’s still a Keystone(XL) Cops comedy of errors.

The Corbin Foss, one of Seattle-based Foss Maritimes’ tugboats, hit the port side of the Ocean Wave, a Crowley Marine Services tug, around 5:30 p.m. Friday in Killiuida Bay on the eastern side of Kodiak Island, where the Kulluk is anchored while awaiting Coast Guard approval to leave, said Petty Officer David Mosley.

It won’t get there or be fixed any time sooner than the Noble Discoverer.

And then there was the Arctic Challenger a useless dockside Queen an “Ice Breaking Barge” with no utility except as a floating hole which on a calm tranquil September day in Puget Sound had its super high tech blowout containment unit crushed like a beer can at half its rated depth.

So-

Shell Vessels Sidelined, Imperiling Arctic Plans

By CLIFFORD KRAUSS, The New York Times

Published: February 11, 2013

The new potential delay in drilling does not necessarily doom Shell’s seven-year, $4.5 billion quest to open a new oil frontier in the far north, but it may strengthen the position of environmentalists who have repeatedly sued to stop or postpone exploration that they claim carries the risks of a spill nearly impossible to clean up.

It may also give the Obama administration considerably more time to decide whether to allow Shell to continue operations in two Arctic seas after repeated accidents, failed inspections and mechanical problems that have called into question the company’s safety management

And today-

Shell Suspends Drilling for Arctic Ocean in 2013

By DAN JOLING Associated Press

ANCHORAGE, Alaska February 27, 2013 (AP)

Royal Dutch Shell PLC says it will not drill for petroleum in the Arctic Ocean in 2013.

The problem with our elites is that they’re massive morons and inbred idiots.

What’s unusual about this one is the sketch lasts for the whole episode.

In High School I was part of a group that amused ourselves by acting out Monty Python skits.  In this piece I sang the Michael Palin role.

It led eventually to our staging a full production of HMS Pinafore which we performed 4 times in the main auditorium and toured at all the Junior Highs and Elementaries in town.  I was cast as the less interesting romantic lead Ralph Rackstraw intead of Captain Corcoran or Sir Joseph Porter, but it did give me a chance to do a duet (Refrain Audacious Tar) with Josephine who I was really interested in, though her not so much.

UK’s credit rating downgraded from AAA to AA1 by Moody’s

Press Association, The Guardian

Friday 22 February 2013 18.05 EST

The agency warned that “subdued” growth prospects and a “high and rising debt burden” were weighing on the economy. But Osborne said the loss of the gold-plated status did not mean the government should change course.

“Tonight we have a stark reminder of the debt problems facing our country – and the clearest possible warning to anyone who thinks we can run away from dealing with those problems,” he said.

“Far from weakening our resolve to deliver our economic recovery plan, this decision redoubles it.

Osborne humiliated as UK loses AAA credit rating

By George Eaton, New Statesman

Published 22 February 2013 22:50

Back in February 2010, a few months before he entered the Treasury, George Osborne declared: “Our first benchmark is to cut the deficit more quickly to safeguard Britain’s credit rating. I know that we are taking a political gamble to set this up as a measure of success.” A gamble it was and how it has backfired on the Chancellor. Tonight, Moody’s became the first rating agency to strip the UK of its AAA credit rating (downgrading it to AA1), citing the “continuing weakness” in the UK’s growth outlook and its “high and rising debt burden”.

For Osborne, who chose to make our credit rating the ultimate metric of economic stability, it is a humiliating moment. Not my words, but his. During one of his rhetorical assaults against Labour in August 2009, he warned: “Britain faces the humiliating possibility of losing its international credit rating”. Rarely before or after becoming Chancellor, did Osborne miss an opportunity to remind us just how important he thought the retention of our AAA rating was.

…

By Osborne’s own logic, then, his deficit plan is no longer credible.

…

The economic consequences of the downgrade are unlikely to be significant. France and the US, for instance, have seen no rise in their borrowing costs since losing their AAA ratings (in fact, yields on US and French bonds have fallen). All the evidence we have suggests that the market is prepared to lend to countries that can borrow in their own currencies (such as the UK) and that enjoy the benefits of an independent monetary policy, regardless of their credit ratings or their debt levels. But the politics of the downgrade are toxic for Osborne.

Still, you might ask, why should we listen to Moody’s, the agency that gave AIG an AAA rating just a month before it collapsed? The answer is simple: we shouldn’t. But this doesn’t alter the fact that Osborne did. For political purposes, he used Britain’s credit rating as a stick to beat Labour with. He can hardly complain if others now use this move against him. Tonight, the Chancellor has been hoist with his own petard.

“I don’t care what the ratings agencies think about anything, but if it’s a stark reminder of anything it’s a stark reminder that you’re the stupidest fucking person on the face of the planet.”- Atrios

“Often “austerity” and the “need” for budget cuts are just excuses to kicks the poors and olds and ram through whatever horrible agenda you wanted to ram through in the first place. But I think the simpleton Gideon Osborne really believes it. He likes kicking the olds and the poors too, but he’ll nonetheless be proved fucking right.

And for some reason Labour is unwilling to just say Shit Is Fucked Up And Bullshit, austerity bites, and we gotta step on the gas.”- Atrios

The condensed Moody’s downgrade

By Alex Hern, New Statesman

Published 23 February 2013 10:43

Some will focus on the fact that Moody’s analysis starts with poor growth as the basic factor for Osborne’s failure. Others will note that Moody’s is still a firm advocate of high-speed deficit reduction.

Still others, myself included, will argue that, apart from the fact that the Chancellor has been hoist by his own petard, all the news really does is prove yet again that ratings agencies aren’t very good at their jobs. Moody’s recognises that Britain’s economic travails stem from depressed growth, but its analysis seems incapable of progressing on from there. Taken as a whole, the agency is saying, with a straight face, that “Britain’s attempts to cut its debt have harmed its attempts to cut its debt, and this could harm its attempts to cut its debt”, and it sees nothing problematic with that.

Really, nothing in Moody’s analysis matters. The only important part of it is that one missing A, and the effect that has on Osborne’s credibility.

Ikea withdraws meatballs in Europe, 21 nations hit

By Karl Ritter, Associated Press

February 25, 2013

Ikea’s North America branch said the U.S. stores get their meatballs from a U.S. supplier.

“Based on the results of our mapping, we can confirm that the contents of the meatballs follow the Ikea recipe and contain only beef and pork from animals raised in the U.S. and Canada,” Ikea North America spokeswoman Mona Astra Liss said in a statement.

Ikea is known for its assemble-it-yourself furniture but its trademark blue-and-yellow megastores also have cafeteria-style restaurants offering Swedish dishes such as meatballs served with boiled or mashed potatoes, gravy and lingonberry jam.

European Union officials met Monday to discuss tougher food labeling rules after the discovery of horse meat in a wide range of frozen supermarket meals that were supposed to contain beef or pork. So far those foods include meatballs, burgers, kebabs, lasagna, pizza, tortelloni, ravioli, empanadas and meat pies, among other items.