Today's Stories

June 9, 2008

Uri Avnery
No, I Can't: Obama, Israel and AIPAC

Nikolas Kozloff
McCain & the Republican Insitute: Promoting Iraqi Occupation for "a Million Years"

Harry Browne
Irish Euro Vote Comes Down to the Wire

C. Hand
U. S. Bid to Hike Iran's Gas Prices Seems Doomed

June 7 / 8, 2008

Alexander Cockburn
Obama Goes Over the Top

Ishmael Reed
How Miles Davis Changed My Life

Jeffrey St. Clair
What a Miner's Life is Worth

Nikolas Kozloff
Meet the King the Beers: John McCain and Latin America

Dave Lindorff
The High Cost of a Single War-Like Remark: Oil Prices, Israel, Iran and the U.S.

Robert Fantina
When Truth is the Casualty

Conn Hallinan
Iran and Rumors of War

Neve Gordon
The Occupation and the Politics of Death

Tom Barry
The Deterrence Strategy of Homeland Security

Patrick Irelan
Raiding the Packing House

Tim Wise
Your Whiteness is Showing

David Ker Thomson
The Hard Question

Joshua Frank
"Socialist" Wins Republican Nomination in Montana

David Yearsley
Disaster Music

James T. Phillips
1968: Year of the Rat

Joe Allen
The Real Bobby Kennedy

P. Sainath
Making Life Brighter in Kondapur

David Macaray
Should Unions be More Democratic?

B.R. Gowani
Experience and the Two-for-One

Fred Gardner
What Happened (at the DA's Office)

Peter Harley
Technology to the Rescue? Kurzweil and the Human Machines

Michael Dickinson
Surrender the Bones of Geronimo!

Jen Roesch
Where are the Real Women in Sex and the City?

Poets' Basement
Gibbons, Landau, and Buknatski

Website of the Day
Partying with the Waltons

June 6, 2008

Frank Barat
An Interview with Ilan Pappé and Noam Chomsky on the Future of Israel / Palestine

Patrick Cockburn
U.S. Extorts Iraq to Approve Military Deal

Gary Leupp
Cheney Enrages Iraqis Over Security Deal

James Abourezk
Name That Terrorist

Peter Morici
Recession Grips the Jobs Market

Faheem Hussain
What is NATO Doing in Afghanistan?

Andy Worthington
Guantánamo's Britons Go on Hunger Strike

Ayesha Ijaz Khan
How Will Musharraf Go? Impeachment or Safe Exit?

Dave Lindorff
Congress Needs to Defend Itself

Website of the Day
Backstage with Bo Diddley

June 5, 2008

Patrick Cockburn
Bush's Secret Deal Would Ensure Permanent U.S. Occupation of Iraq

Sharon Smith
Hillary's Wreckage

Nikolas Kozloff
Obama's Electoral Dilemma: Latinos or Reagan Democrats?

Linn Washington, Jr.
Police Brutality and Cover-Up in Philly

Omar Barghouti
60 Years of Nakba, 41 Years of Occupation ...

Scott Pellegrino
Jim Crow Radio: Bob Grant's Lifetime Achievement Award

John Walsh
Obama Woos AIPAC

Dan Bacher
The Parching of California

DC Larson
Nazi Rockers ... F-Off

Robert Jensen
Masculine, Feminine or Human?

Website of the Day
Ohio Cops Attack Long Walkers

June 4, 2008

Eric Walberg
Princess Patricia and the Taliban

Gary Leupp
Iran and EFPs: Chronology of a Lie

Ralph Nader
Disenfranchised Youth

Dave Lindorff
Of Whiners and Poor Losers

George Wuerthner
Farm Economics

Victor M. Rodriguez
The Puzzle of Race and Politics

Remi Kanazi
Why a Cultural Boycott of Israel is Needed

Stephane Luçon
Renault's Romanian Fairyland Suspended

Farzana Versey
The Tablighi Jamaat Movement

Laray Polk
The Militarization of Space

Website of the Day
Red State Rebels

June 3, 2008

Paul Craig Roberts /
Lawrence M. Stratton
Legislating Tyranny

Mike Whitney
The Withering Economy

Steve Early
San Juan Showdown

Manuel Otero
Why Hillary Won Puerto Rico: the View from the Colony

George Bisharat
The Hope of a Victimized People

Nikolas Kozloff
Obama's VP Quandry

Dan Bacher
Death on the Salmon Highway

Website of the Day
Censoring Bill Knott?

June 2, 2008

Uri Avnery
The Olmert Scandal

Nikolas Kozloff
Obama's Latino Problem Getting Worse

Allan J. Lichtman
Revisionist History: Bush, Borah and Hitler

Malini Johar Schueller
The Color of Randomness: Returning to the US From Beirut Via Syria

Robert Weissman
What's Driving Skyrocketing Oil Prices?

Peter Morici
Bailing Out Wall Street

Manuel Garcia, Jr.
Don't Get Burned: How to Protect Yourself From Raytheon's Pain Gun

John Ross
Celebrating Catholic Fanaticism in Mexico

Ahmad Al-Akhras
Encounters with the Watch List

Website of the Day
Man on Earth

May 31 / June 1, 2008

Alexander Cockburn
The Worst is Yet to Come

Jeffrey St. Clair
Arkansas Bloodsuckers

Gary Leupp
How McClellan Prettifies Bush

Stan Cox
Broken Agriculture

Rannie Amiri
Lebanon: the Domino That Wouldn't Fall

P. Sainath
A Guaranteed Day's Work--in the Fields, at 110 Degrees, for $2 a Day

Binoy Kampmark
Going Bankrupt in Vallejo

Robert Fantina
Bush, Rice and McClellan

Seth Sandronsky
Will There be Water Riots, as Sacramento Goes Dry?

Corporate Crime Reporter
Death Penalty for Bush?

Anthony DiMaggio
Gaming the Ghetto: Grand Theft Auto IV, Racist Media and the Concrete Jungle

Karl Grossman
A Half-Trillion for Nukes

Matt Reichel
From Vegas to the Heartland and Back Again

Paul Myron Hillier
Of Gas and God

Andy Worthington
Suicide at Guantánamo

David Yearsley
And the Winner is ... Wayne Shorter

Daniel Cassidy
Free Lunch

Charles Thomson
If Hitler Had Been a Hippy ...

Gary Corseri
A Dream Deferred: Activism and the Arts

Wajahat Ali
Sex and the City Through a Man's Eyes

Ron Jacobs
Robins Weep

Poets' Basement
McNeill and Davies

Website of the Day
Last Charge of the Light Horse

May 30, 2008

Bassam Aramin
Here's the Truth You've Been Running From

Andrew Cockburn
Petraeus' Iran Obsession

Saul Landau
How We Got Into This Mess

Nikolas Kozloff
Meet South America's New Secessionists

Robert Sandels
Turning Back the Clock on Cuba

Dave Lindorff
Talk is Cheap

Martha Rosenberg
Raiding Big Meat; Arresting the Wrong People

Harvey Wasserman
Lieberman & McCain: Linking Internet Censorship and Atomic Reactor Terror

Doug Giebel
A Plague on Both Your Houses (of Congress)

Shaun Harkin
The Trial of the Raytheon 9

Website of the Day
The Once and Future Environmental Movement

May 29, 2008

Jeffrey St. Clair
Bill Clinton and the Rich Women

Nikolas Kozloff
Puerto Rico, Obama and the Politics of Race

Col. Dan Smith
Deceiving the Dead

Karl Grossman
The Most Lucrative Incentive for Nuclear Power in the History of the United States

William S. Lind
Inside the Washington Game

Robert Weissman
What to do About the Price of Oil

Dave Lindorff
Why Puerto Rico Won't Matter

David Macaray
A Union Fable

Chris Genovali
Fear and Loathing in the Northern Rockies

Laura Carlsen
Mexico's Battle Over Oil

Website of the Day
Support Antiwar.com

May 28, 2008

Wajahat Ali
The Libertarian Dark Horse: An Exclusive Interview with Ron Paul

Ralph Nader
What's Really Driving the High Price of Oil?

Brian McKenna
Why I Want to Teach Anthropology at the Army War College

Corporate Crime Reporter
Why Vincent Bugliosi Wants to Prosecute George W. Bush for Murder

Brian Cloughley
The Attack on Damadola

Eric Walberg
Opium for the Masses from Afghanistan

Michael Dickinson
Raytheon's Pain Ray: Coming to a Protest Near You

Ijaz Khan
Opening Windows in Pakistan

Website of the Day
Older Than America

May 27, 2008

Alexander Cockburn
In Her Mind She's Killed Before: the Plot to Assassinate Ralph Nader

Greg Kafoury
Is Obama Turning (Further) Right?

Jean Bricmont
Western Delusions

Tim Wise
Farrakhan is not the Problem

Ricardo Alarcón
Puerto Rico's Turn

Stephen Soldz
APA Supports Psychologist Engagement in Bush Regime Interrogations

Andy Worthington
The Guantánamo 16

Alan Singer
Vapid, Stupid and Insulting: Chuck Schumer Speaks to the Graduates

Richard Neville
Storm in an A-Cup

Susie Day
Gone with the W

May 26, 2008

Uri Avnery
The Syrian Option

Bill Quigley
War Immemorial Day

Col. Dan Smith
Retreating from Hell: a Different Memorial Day

Cindy Sheehan
Why Memorial Day is a Double-Whammy for Me

Marjorie Cohn
Hillary's Assassination Politics: Her Last Shot?

Fred Gardner
Does the VA Care?

Raymond J. Lawrence
Pain Pays: Getting Rich at NY Presbyterian Hospital

Harvey Wasserman
Mugging the Election System

Moncia Benderman
Truth Matters

David Rovics
In Praise of Utah Phillips

Website of the Day
Fox News Jokes About "Knocking Off" Osama and Obama

May 24 / 25, 2008

Alexander Cockburn
Death-Wish Hillary Primes Manchurian Candidate

Jeffrey St. Clair
Yellowstone: How Sununu Shrank the Ecosystem

Barbara Rose Johnston
Dam Legacies, Damned Futures

Nikolas Kozloff
U.S. Fourth Fleet in Venezuelan Waters

Adriana Kojeve
The Environment and the 2008 Elections

Robert Fantina
Justice Department's Revelations on Torture

Dave Lindorff
Bush's War on Children in Iraq

David Yearsley
The War on Kitsch

Nelson P. Valdés
The Buying of "Democracy" Agents in Cuba

Kathleen M. Barry
Celebrating Ethnic Cleansing

John Ross
Mexico's Narco Opera Reaches for High Point

Allison Kilkenny
Apathy Doesn't Live in Bronx

Fred Gardner
Orangeburg, 1968

Elizabeth Schulte
Can the Whole World be Fed?

Daniel Gross
Remembering the Wendy's Massacre: the Dangerous Side of Retail Work

Christopher Brauchli
The Search for a Token Right-winger

Richard Rhames
A Nation of Sheep

Daniel Cassidy
My Mother

Poets' Basement
Davies, Klipschutz and Willson

Website of the Weekend
Happy Birthday, Bob

May 23, 2008

Paul Craig Roberts
War Abroad, Poverty at Home

Alan Farago
The Radical Extremists of the Building Industry

Conn Hallinan
Ballots and Bullets: From Beirut to Bolivia

Mark Engler
The World After Bush

George Wuerthner
Cars and Cows: Living Large in America

Kamran Matin
The Kurds and American Neo-Imperialism

Sandy Boyer /
Shaun Harkin
The Long Incarceration of Pol Brennan

Robert Weitzel
A "Holey" Instrument of Peace in Iraq

Cindy Sheehan
An Uphill Battle

Liaquat Ali Khan
Pakistan's Futile Constitutional Amendment

Website of the Day
A Message from the Moral Compass of the McCain Campaign

May 22, 2008

Vijay Prashad
Racist Grammar

Joanne Mariner
A Military Commissions Cheat Sheet

Sharon Smith
60 Years of Apartheid

Jeff Birkenstein
Disaster Redux: Some Early Thoughts on the Earthquake in China

Brendan McQuade
From Obama to the PRTs in Iraq

Peter Morici
The Sorry State of the Banking Industry

Niranjan Ramakrishnan
Restoration Boulevard

Dave Zirin
What I Want to Ask Mary Tillman

Ron Jacobs
CPR for the Antiwar Movement

Stephen Lendman
Immoral Hazard

Website of the Day
Hagee: God Sent Hitler to Drive the Jews to Israel

May 21, 2008

Jeffrey St. Clair
The Gothic Politics of Hillary Clinton

Nikolas Kozloff
U.S. Military Bases in South America

Alan Farago
Miami, Cuba and the Presidential Campaign

Dave Lindorff
Big John and the Scary, Scary Iran Threat

David Model
Genocide in Iraq?

Eric Walberg
Afghanistan: Who is the Enemy?

Franklin Lamb
Lebanon Gets a President

Kenneth Couesbouc
Tax Against Tyranny

Website of the Day
Child Labor and War-Affected Children: a Photo Essay

May 20, 2008

Ralph Nader
A Trip Inside Google

Uri Avnery
With Friends Like These

Patrick Irelan
The Empire and the Fleet

Ray McGovern
Come Out, Admiral Fallon, Wherever You Are

David Macaray
The UAW Strike Against American Axle

Chris Genovali
Big Oil on the Water: Skating Around the Tanker Issue

Ibrahim Fawal
Birmingham, Israel and the Nakba

Christopher Ketcham
Let Us Now Praise Famous Suicides

Andy Worthington
Guantánamo Trial Delayed

Martha Rosenberg
Merck is a Repeat Offender

Website of the Day
Defend the Students Who Pied Tom Friedman

May 19, 2008

Saul Landau
Cuba Will Live

Paul Craig Roberts
The Metamorphosis of the Conservative Movement

Brian McKenna
Brotherly Love in Philly's Badlands

Patrick Cockburn
City of the Dead: Mosul on Lockdown

B. R. Gowani
The Central Problem Pakistan Needs to Tackle

Dr. Trudy Bond
Psychologists and Torture: If Not Now, When?

Cindy Sheehan
Whose War is It?

John Mohawk
The Warriors Who Turned to Peace

Remi Kanazi
When Free Speech Doesn't Come for Free

Robert Day
I Get a Horse

Website of the Day
Evolve or Die

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Fueled by War Debt and Surging Oil

A Ripe Time for Inflation

By KENNETH COUESBOUC

If people expect an increase in inflation to be temporary and do not build it into their longer-term plans for setting wages and prices, then the inflation created by a shock to oil prices will tend to fade relatively quickly.

--Ben Bernanke at Harvard, June 4th 2008.

The term inflation only applies to rises in the consumer price index. When the price of shares (or houses) inflates, it is called a bubble. This is because the consumer price is the final price, no more added value, no selling on at a profit. And because the price of shares (and houses) goes up and down on a regular basis, whereas the consumer price index rises constantly (1).But the double terminology also suggests that bubbles resemble each other and have nothing to do with inflation.

On the stock market, prices vary according to supply and demand, as they should. A general rise in the price of shares across the board means that demand exceeds supply. This can happen because demand increases, when more and more punters put their savings on the gaming-table. But it can just as well happen because supply is reduced, when shares are hoarded. However, only increasing demand can result in a stock market bubble, as was the case some years ago, when everyone wanted a piece of the dot-com gamble. A stock market bubble draws in cash when it inflates, and destroys that cash when it bursts. By attracting money and reducing demand elsewhere, inflation on the stock market and its final destruction of liquidity tends to be deflationary, in the sense that it reduces demand on the consumer market.

Prices on the housing market also vary according to supply and demand. But these two variables have little in common with the supply of and demand for company shares. New-comers to the property market usually need more than their savings to buy a house or an apartment, and so increasing demand depends largely on borrowing. Reducing supply by hoarding urban real estate does happen in a few large cities around the world, but it is marginal and its effect on prices is local (2).

A housing bubble is inflated with debt and does not destroy that debt when it bursts. The price of houses falls but the debts remain. Based on debt, inflation on the housing market does not reduce demand elsewhere. Instead, as long as the amounts lent out exceed the amounts paid back, the increasing demand for houses inflates the price of building materials and generously circulates liquidity. It is only when the bubble bursts and the flow of credit dries up, when more is paid back than is lent out, that consumer demand is reduced to essentials.

Stock market bubbles have a deflationary effect. They draw in cash and seemingly destroy it when the bubble bursts. Though, in fact, it has fed huge profits and fat wages that may have affected the price of luxury goods, “art” and up-town apartments, but not the consumer price index. Housing bubbles have an inflationary effect on building materials. As house prices rise, building accelerates and demand for materials increases faster than supply. But this does not directly affect the consumer price index either. When the tide of credit recedes, for lack of credit worthy customers or because the limits of over borrowing are reached, demand drops and house prices fall. All the more so that the building sector is in full expansion and a large number of new houses are being built. However, the value destroyed by falling house prices was paid with credit, not in cash. Not with unspent incomes from the past, but with as yet unearned future incomes. And, as the value of the mortgage becomes greater than that of the devalued house, each dollar paid back is devalued in proportion to the devaluation of the property.

Future incomes will be paying the house more than its market value, so each dollar will pay back less than a dollar’s worth of house. This contradiction is resolved by inflation, when the house regains its nominal price in a devalued dollar.

A housing market has borrowers. It must also have lenders. As the bubble begins to deflate, some of these lenders are faced with multiple foreclosures and have trouble surviving. But the larger institutions write off their losses and carry on their business as usual. Except that lending is almost at a standstill, while most borrowers are still paying back their debts. Vast sums are being repaid that cannot be lent out again. So where can all this money go to make a profit? As long term interest rates are rising, bonds are not a good buy (3). Share prices on the stock market are like a roller-coaster, brief ups and scary downs. Real estate is out of the question. So all that remains are futures on the commodity market.

Prices on the commodity market vary according to supply and demand. Demand resembles that of the stock market, cash and short term credit. Whereas supply has its own particularities. Commodities are produced to be transformed by the production process, and have a relatively short life span. They can be hoarded but, as they occupy space and mostly need special storage conditions, this is at a cost. In fact, most storage is either “strategic” or imposed by seasonal crops. But it is the nature of commodities that makes their supply different from the supply on other speculative markets.

The supply of public debt increases and occasionally decreases. The number of companies that have shares on the stock market goes up and occasionally down. Houses are being built all the time and some are occasionally blown down or swept away. But the supply on these markets concerns not only the increase but, potentially, the whole of the stock. Old and new are bought and sold without distinction. Whereas commodities must be constantly produced anew to supply the market, before being transformed by the production process. As the supply of commodities is a flux rather than an increasing stock, it can be interrupted. Natural disasters, war, peaking non-renewables, climate change, all threaten tomorrow’s expanding production of commodities. This being so, any rational analysis must conclude that the actual flow of commodities is more likely to slow down than to accelerate, at a time when demand is expanding as never before. An ideal situation for speculative investments.

Commodities are the produce of the planet. The production of minerals, fossilised organic matter, plants and animals depends primarily on that amazing and improbable system we call Earth, and only secondarily on human activity (4). A technological adaptation of ancient eschatological fantasies, had led to the dream of travelling through space to other worlds. But it is increasingly obvious - was there ever a reasonable doubt? - that living anywhere else but here is beyond our scope. One planet, one world, and its generous abundance has limits. As does its capacity to absorb our waste emissions. By digging and pumping things out of the ground and diffusing them into the air and water, we are modifying the composition of these two primeval elements. Lakes and rivers are poisonous and the sea merely dilutes these toxic waters, as ocean currents spread the poison all around the globe. At the same time the atmosphere’s complex mixture of gases is being changed. Not so long ago, CFCs gave a clear sign of what was possible. To-day, the increasing proportion of CO2 and the decreasing proportion of oxygen in the air seem to be having an effect on atmospheric conditions. Though this is still under debate, we can be fairly sure that the carbon trapped underground as coal, oil and methane was taken out of the atmosphere by very large plants and very small animals, long before Australopithecus roamed the Rift valley. By burning fossil fuels, we are replacing oxygen molecules by molecules of carbon dioxide. This is recreating conditions that pre-date human presence on Earth, and could make parts of the world uninhabitable for a variety of species, including our own. It has already increased the frequency and force of tornadoes and tropical storms.

The consumption of mineral resources is close to its Gauss curve peak (5), and powerful storms are wrecking the plains and swamping the deltas. The world’s supplies of minerals, fuel and food will stop growing as a result, and may drop because of interactions between the two. Producing food needs fuel and minerals, and producing fuel and minerals needs food. But demand has no reason to stop growing, as long as it is solvent, as long as it can pay. What remains to be seen is who can continue paying ever rising prices. America prints the stuff, the wherewithal, while China, Japan, Germany and a few others are holding vast quantities of it in cash and bonds. On the world commodity market, the dollar reigns supreme, with the euro and the yen playing a very minor role. So rising prices simply need more dollars. The US Treasury has been working hard at it for years and seems set to accelerate the new supply. In a world awash with the green stuff, there is nowhere better for it to go than on the commodity market.

Inflation is often described as too much money chasing too few goods, and this description does seem to apply to the stock, housing and commodity markets, but not to the only accepted measure of inflation, the consumer price index. As yet there is no sign of excess money in the consumer’s pocket. In fact, most consumers are already finding it difficult to face up to the rising prices that are manifestly the result of a top down effect. So the description above may apply to speculative and credit bubbles, but it does not describe inflation as such, measured by the consumer price index.

Rising consumer prices and rising wages are usually associated, and this has become a dogma with the onus placed on wages. And, because wages are a part of the selling price, rising wages do automatically push up prices all along the chain and on to the consumer. This observation has led to the application of a lowest possible minimum wage linked a posteriori to inflation. Meaning that inflation happens and then, hopefully, wages follow. So that neither the low level, but chronic, inflation of the past twenty-odd years, nor the build up of hyper inflation over the past months, can be blamed on wages. Wages rise when wage earners can no longer manage on their earnings and, even then, strike action or some more general social upheaval is usually necessary. A problem that can be countered for a while by easy credit and tax rebates. But this is a move that leads unerringly to over-borrowing by both the government and individuals.

Wage rises are a reaction to consumer price inflation, not its original cause. But rising wages do in turn push up consumer prices. This is because wages are competing for a share of added value with the other two main beneficiaries, taxes and profits. If wage rises are compensated by falling profits or taxes, prices are unchanged. Whereas low wages and low taxes leave room for large profits. And, as profit is the driving force of capitalism, all is done to keep wages and taxes as low as possible and to compensate the lack of spending power with credit. For the past twenty years or so and at in increasing amounts, profits have been invested abroad and credit granted at home, so that a growing proportion of home demand is based on future incomes.

Overdrafts, credit cards, mortgages and T-bonds - not to mention the subprime stuff - have insured growing consumer demand at home, while profits were out-sourced as investments and came back as consumer products. Growing profits invested overseas have built up an equivalent debt at home, to compensate the low level of wages and taxes. This process seems to have reached its limits, and returning investments are as forlorn as paid back housing debts. And the commodity market beckons them all. That much more money chasing too few goods.

The inflation chart (1) shows three periods of high inflation, 1916-1921, 1941-1948, 1973-1982. All three are linked to war and fossil fuels. The first period starts during the war in Europe, where the possession of coal reserves played a major part. The second period starts when the Germans tried to take control of the Caspian oil fields and the Japanese, after bombing Pearl Harbour, briefly took over the Indonesian ones. The third period starts after the Yom Kippur war, when oil sales were interrupted and prices soared. In 2008, we have government borrowing for war and soaring oil prices. And if that were not enough, food prices are reacting to foreseeable supply shortages, house prices are plunging and climate change seems upon us. Finally, if inflation is simply a phenomena resulting from the long borrowing cycle - every thirty years - then the time is ripe.

Kenneth Couesbouc can be reached at: kencouesbouc@yahoo.fr

Notes

1. Deflation seems to be a thing of the past, possibly due to the demise of the gold standard.Inflation in the US, 1914-2006

2. Bubbles stimulate and increase supply on both markets. But when the bubbles burst, the star-ups disappear whereas the building sites remain. The effect on employment is also quite different.

3. When the rate of interest increases, existing bonds automatically lose value. For example: $5 = 5% of $100 = 10% of $50. I-bonds have variable interest rates that increase with inflation. This theoretically prevents them from losing value.

4. However, it is human activity that creates the exchange value of commodities. The rent, royalties and concessionary rights that are added are the privileges of private and state property.

5. The precise position in time of the different production peaks for non-renewables can only be known after the event. But there are signs (other than price inflation) that suggest we have reached the peak for several products, including oil.

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