Today's Stories

April 30, 2008

Michael Hudson
The Fed Sinks the Dollar

April 30, 2008

William P. O'Connor
The Day I Lost My Innocence

Bob Fitrakis /
Harvey Wasserman
Did the Supreme Court Just Elect John McCain?

Tariq Ali
Storming Heaven: 1968 Revisited

John Ross
Bad Jazz in NOLA: Three NAFTA Leaders Sit It for the Last Time

Glen Ford
Pop Goes the Race-Neutral Campaign!

Joshua Frank
Election Season Piffle: Thinking Outside the Voting Booth

Ashley Smith
Iraq After Basra

Robert Weissman
Medical R&D That Works in the Developing World

Sen. Russ Feingold
Bush's Shroud of Secrecy

Website of the Day
Richard Nixon, April 30, 1970

April 29, 2008

Uri Avnery
The Military Option

Roedad Khan
Why Gen. Musharraf Must Go

Chris Floyd
The Torture Election

Paul Craig Roberts
The Iraq War Morphs Into the Iran War

Dave Lindorff
Invasion of the Pumpheads

Mats Svensson
Mental Barriers in Palestine

Peter Morici
Will the Fed Broaden Its Focus?

Mike Ferner
Inside American Royalty's Security Bubble

John Weisheit
Towing Icebergs to San Pedro

Amit Srivastava
China Olympics, Tibet Crackdown, Coke Profits

Website of the Day
Tom Friedman Gets Creamed

April 28, 2008

JoAnn Wypijewski
On Queen's Boulevard, the Night Sean Bell's Killers Got Off

Mike Whitney
Jeremiah Wright Delivers the Knockout Punch: But Will It Topple Obama?

Iris Keltz
The Fruiting Fig Tree: Memories of East Jerusalem

Steve Niva
The New Walls of Baghdad: the Israeli Model Surges Toward Iraq

David Macaray
CAFTA's Bloodtrails

John Ross
"Adelitas" Shut Down Mexico's Congress

Stephen Lendman
The Politics of Green Scare

Malou Innocent
On "Withdrawing Responsibly" from Iraq

Christopher Brauchli
Want to Learn the Ins-and-Outs of the Slumping Economy? Just Ask Ashley ...

William Kaufman
Michael Moore's Embrace of Obama: a Polemic Devoid of Politics

Website of the Day
Get Your Fix

April 26 / 27, 2008

Alexander Cockburn
Nothing Will Get Hillary Out of the Race

Ralph Nader
A World of Hunger

Peter Camejo
A Crying Shame: the Wages of Left Capitulation

Harvey Wasserman
Making You Pay for the Next Chernobyl--in Advance!

Franklin Lamb
Will U.S. Policy in Lebanon and the Middle East Ever Change?

Wajahat Ali
Fisk Fighting: an Exclusive Interview with Robert Fisk

Mike Whitney
Food Riots and Speculators

Andrew Wimmer
Obliterate Them!

David Yearsley
Nero, Frederick the Great, Nixon ... They All Did It Better Than Clinton

Greg Moses
Chicago: the Stupid Experiment

Ron Jacobs
Walking the Lonely Road

Robert Fantina
Bush v. Carter: Let History Judge

Missy Comley Beattie
Introducing President McCain

Linn Cohen-Cole
The Criminalization of Raw Milk: a Mennonite Farmer is Hauled Away

Paul Krassner
Remembering Ruben Salazar

Jeffrey St. Clair
Booked Up

Poets' Basement
Buknatski, Khaiyat, Lair, and Kowit

Website of the Weekend
Justice for Sean Bell

April 25, 2008

George Ciccariello-Maher
Embedded with the Tupamaros

Dave Lindorff
The Bitter and the Biased: How Clinton Courted Racists in Pennsylvania

Franklin Lamb
The Israeli Project Has Failed in Lebanon

Alan Farago
Hacking the Development Code: the Politics of Zoning in Florida

John W. Farley
Syiran Nukes: the Phantom Menace

Kathleen M. Barry
Some Questions for "Femininists for Clinton:" Is There Really Any Difference Between Hillary and Condi?

Mohammed Alireza
Cowboys and Iranians

Nick Dearden
Haiti and the Black Hole of Debt

Carmelo Ruiz Marrero
Why Biotech is Betting on Biofuels

Bruce Springsteen
Farewell to Danny

Website of the Day
It's Bigger Than Hip Hop

April 24, 2008

Linn Washington, Jr.
Duplicity Demeans Clinton Campaign (or When Bill Praised Farrakhan)

Franklin Lamb
Bush to Nasrallah: an Offer Hezbollah Cannot Refuse?

Jennifer Van Bergen
The High Crimes of John Yoo: the President's Executioner

Joanne Mariner
U.S. Hypocrisy and the Malaysian Guantánamo

Mark Engler
Trade Politics and the Battle for the Soul of the Democratic Party

Dave Lindorff
The Politics of Obliteration: Hillary's Monstrous Threat

John Blair
Obama's Missed Opportunities in Evansville: Did He Even Know It Was Earth Day?

De Clarke / Stan Goff
Politics is Food is Politics

Binoy Kampmark
Bowling for Boris: the Tories, Red Ken and the London Mayoral Race

Philippe Marlière
Sarkozy and the Specter of May 68

Peter Morici
The Bank of England Misses the Point

Website of the Day
Fair Food Nation

April 23, 2008

Cockburn / St. Clair
Straggling to Denver

Vijay Prashad
McCain's Mask

Paul Craig Roberts
What the Iraq War is About

Stephen Soldz
The Involuntary Drugging of U.S. Detainees

Laura Santina
Hillary: Another Feminist Perspective

John Stauber /
Sheldon Rampton
Pentagon News Networks

Dave Lindorff
What Double Digit Win? Media Round Up in PA

George Ciccariello-Maher
Radical Chavismo Growls a Challenge

Ralph Nader
Andy Stern's Rackets

John Weisheit
Rearranging Deck Chairs at Glen Canyon Dam

Website of the Day
Wal-Mart's "Cost of Admission"

April 22, 2008

David Isenberg
Spinning Saddam's Linkages

Stan Cox
The Political Economics of Greenwashing

David Macaray
Memo to the Clinton Campaign: They Are Still Murdering Labor Unionists in Colombia

Jeff Birkenstein
Playing the Opposite Game: Or Why Can't I Sell Out?

Mike Whitney
Memo to Bernanke: Enough With the Rate Cuts, Already!

Nikolas Kozloff
Bush's Paraguayan Fiasco

Floyd Rudmin
From Lhasa to Bilbao: Journey of a Double Standard

Carlos Villarreal
Why John Yoo Should be Dismissed From Boalt Law School--And Prosecuted

Ray McGovern
What About the War, Pope Benedict?

Michael Gould-Wartofsky
El Barrio Fights Back Against Globalized Gentrification

Robert Ovetz
A Fish Tale

Pat Wolff
Rightwing Power Grab in Cornhusker State

Website of the Day
Defend the Rutgers 3!

April 21, 2008

Bill Quigley
The U.S. Role in Haiti's Food Riots

Uri Avnery
The Lion and the Gazelle

Dave Lindorff
The U.S. Economy and the Costs of War

Wajahat Ali
Finding Osama Bin Laden with Morgan Spurlock

Andy Worthington
Hollow Gestures at Guantánamo

Robert Jensen
The Sorrows of Race and Gender

Ron Jacobs
Clampdown at Evergreen

Dan Bacher
The Great Salmon Closure

Harvey Wasserman
Where's George?

Danny Alexander
Remembering Danny Federici

Website of the Day
Save Our Taco Trucks!

April 19 / 20, 2008

Alexander Cockburn
McCain: What Really Happened When He Was a POW?

Patrick Cockburn
A New Struggle is Beginning in Iraq

Wajahat Ali
Zinn Speaks

Andrew Wimmer
Papal Benedictions

Rev. William E. Alberts
Jeremiah Wright and America's Continuing "Separate and Unequal" Societies

David Rosen
Texas Two-Step: The Polygamy Raid and the Regulation of Sexual Life

Robert Fantina
McCain Detests War?

Ramzy Baroud
The Politics of Armageddon: McCain's Pastors and the Middle East

Saul Landau
The No Escape Clause on Iraq

Dr. Susan Block
Raelians, Aliens and Evolution

David Yearsley
Suitcase Arias and Ithacan Jazz

Phyllis Pollack
On the Red Carpet with the Rolling Stones

Jeffrey St. Clair
Booked Up

Poets' Basement
Hartz, Newberry and Khaiyat

April 18, 2008

John Ross
The Bush Legacy: Losing Latin America

Dave Lindorff
Courage and Conviction: In Praise of Bill Ayers

Dan Glazebrook
An Interview with Robert Fisk

Carl Finamore
A Look Inside the Hangars

Rannie Amiri
J Street: Do We Really Need Another Pro-Israel Lobby?

Richard Morse
A Creepy Roadblock at Midnight

Ko Young-dae
CONPLAN 8022: Inside Bush's Nuclear War Plan for the Korean Peninsula

Farooq Sulehria
A Himalayan Surprise

April 17, 2008

Michael Hudson
Hillary Joins the Vast Rightwing Financial Conspiracy

Robert Bryce
The Ethanol Apologists

Kathy Kelly
Weary of War? Don't Collaborate

Madis Senner
The Carrion Feeders' Ball: How Hedge Funds Reap Billions Off Economic Misery

Peter Morici
The G7, the Banks and GE

Ron Jacobs
Washington, al-Maliki and the Militias

William S. Lind
A Confirming Moment in Basra

James Murren
Obama's Disconnect with Small Town America

Ben Terrall
Losing Haiti

Walter Brasch
Political Log Rolling in Clinton County, PA

Website of the Day
Stealth Attack: Homegrown "Terrorism" Bill

April 16, 2008

Bill Kauffman
The Candidates from Nowhere

Roxanne Dunbar-Ortiz
Colonization and Massacres

Saul Landau
How to Leave Iraq

Peter Morici
McCain's Economic Plan: GOP Out of Ideas (But So are the Democrats)

Eric Toussaint /
Damien Millet
Bankers Saved, Human Rights Sacrificed

Jeff Ballinger
Inside Nike's Asian Sweatshops: Squeezed Vietnamese Workers Strike Back

David Macaray
Union Strikes and Replacement Workers

Gary Leupp
Electoral Revolution in Nepal

Richard Morse
The Food Riots in Haiti

George Ciccariello-Maher
Einstein Turns in His Grave

Dave Lindorff
Letters from the Bitter Belt

Website of the Day
Surviving Prozac

April 15, 2008

Ralph Nader
The Politics of Distraction in an Age of Gotcha Capitalism

Uri Avnery
Manifest Destiny and Israel

Brian Cloughley
Arrogant Lies

David Price
Outrageous Pre-Tour de France Ban

Joe Bageant
Bitter America: Media Shit Storms and Heartland Reality

Steve Early
The Purple Punch-Out in Dearborn

Mats Svensson
To Create Something from Nothing: the Making of a Palestinian State

Michael Donnelly
Dead-Eye Hil and the Elitist

April Howard /
Benjamin Dangl
Dissecting the Politics of Paraguay's Next President

Laray Polk
Let's Not Put the Torch in a Bubble

Charles Modiano
What Does a Woman Have to Do to Get on the Cover of Sports Illustrated?

Website of the Day
The $3 Trillion Shopping Spree

April 14, 2008

Carl Finamore
Airline Deregulation Makes a Hard Landing

Michael Hudson
A Trillion Dollar Rescue for Wall Street Gamblers

M. Shahid Alam
Hizbullah's Big Win: Has Israel Finally Met Its Match?

Patrick Cockburn
A Cleric, a Pol and a Warrior

Paul Craig Roberts
Petraeus Sets Up Iran

Joanne Mariner
Redition to Jordan: What Happens When the Gloves Come Off?

Martha Rosenberg
Suicide and Cymbalta

Dave Lindorff
The Bitterness Thing: Is Obama Channeling Nader

P. Sainath
Hot Messages to Sex Dancer Doom Condi's New Finnish Pal

John V. Whitbeck
On Hypocrisy Over Tibet: a Personal Reflection

Website of the Day
Spying on Environmental Groups

April 12 / 13, 2008

Alexander Cockburn
Olympic Torch Toasts US Candidates

Patrick Cockburn
Warlord: the Rise of Muqtada al-Sadr

Mike Whitney
Want to Save the Economy?

David Yearsley
Film Scores and Westerns: the Stealth Cavalry of Empire

Robert Fantina
Bush's Brand of Morality

Conn Hallinan
Another Defining Moment in Iraq

Bill Hatch
In Praise of Hippies and the Counter-Culture

Ramzy Baroud
The Basra Battles

George S. Hishmeh
Back to Square One

Ron Jacobs
The New New Left in Latin America

Nikolas Kozloff
Olympic Torch in Buenos Aires

Charles Thomson
The British Prime Minister and the Tate's Tin of Shit

Alexander Billet
The Disney-fication of CBGB

Missy Beattie
Huffing and Puffing to Failure

David Michael Green
America's Jones for War

Seth Sandronsky
Education Entrepreneurs

Prairie Miller
Meeting David Wilson

Jeffrey St. Clair
Booked Up

Poets' Basement
Ko Un, Ibn Salma and Greaves

Website of the Weekend
Americans United for Palestinian Human Rights

April 11, 2008

Nikolas Kozloff
The Clintons and Their Sordid Colombia Advocacy

Wajahat Ali
Revenge of the Ghetto Nerd: an Exclusive Interview with Junot Diaz

Sharon Smith
Let Them Eat Ethanol!

Yigal Bronner / Neve Gordon
Digging for Trouble: the Politics of Archaeology in East Jerusalem

Alan Farago
Eating South Florida

Dave Lindorff
On Waking Sleeping Giants: Lessons for America from China

George Wuerthner
Money for Nothing? The Problems with the Conservation Reserve Program

Christopher Brauchli
Prostitutes Don't Do Funerals

Website of the Day
Animals Explain the Insurance Industry: a Health Care Video

April 10, 2008

Mathieu Vernerey
Tibet for the Tibetans!

Elizabeth Schulte
Slavery in the Fields

David Macaray
Labor Unions Will Never Get a Fair Shake

Ashley Smith
The Rise of Muqtada al-Sadr

Peter Morici
Driving Up Debt and Dragging Down Growth

Jacob Hornberger
The Military's Distintegrating Family Life

Harold Austin
Snitch or Else: Prison Officials Threaten Gang Drop Outs

Website of the Day
Hillary: the Wal-Mart Videos

April 9, 2008

Paul Craig Roberts
The Fading American Economy

Winslow T. Wheeler
Congressional Theater: the Petraeus / Crocker Hearings

C. Hand
Why Dave Marash Left Al Jazeera

Paul Krassner
Sex and Violins

Paul Wolf
Colombian "Magnicidio" Remains a Mystery After 60 Years

Wajahat Ali
Alien Invasion!

Karyn Strickler
Lost in the Fumes: the Sierra Club Sells Out to Clorox

Dan La Botz
Confronting the Economic Crisis

Eric Walberg
The Shadow of Munich: Another NATO Flop

Robin Millenthal
Enough Already! Growth and the Tar Sands Economy

Website of the Day
Conservative Nanny State

April 8, 2008

Mike Whitney
Should Khalid Sheikh Mohammed be Set Free?

Nikolas Kozloff
Bush Bullies Congress on Colombia Deal

Greg Moses
Migrant Detention in South Texas

Joshua Frank
The Other Military Draft

John Ross
Mexico City's Urban Tribes Go on the Warpath Against EMOS

Michael Donnelly
Hillary's Western Swing

John V. Walsh
Why Obama Lost Massachusetts

Jeff Nygaard
Health, Security and Mandates

Bill Piper
Last Shot for a Bush Legacy?

Sen. Russ Feingold
Legal Representation and the Death Penalty

Website of the Day
Catonsville 9, Forty Years Later

April 7, 2008

Ishmael Reed
The Irish Black Thing

Harry Browne
Irish Peace Activist Acquitted; Deported

Uri Avnery
Tibet and Palestine

Lenni Brenner
Obama's Constitution, His Pastor and His Unbelieving Mom in Heaven

Ayesha Ijaz Khan
America Must Respect Pakistan's Democracy

Robert Fisk
Fearful Lives in the Land of the Free

Edwin Krales
Ensuring the Success of Fascism in Spain: the US Corporate Role

Chris Genovali
Vancouver Island's Dwindling Ancient Forests

Website of the Day
LA Artists Against War

April 5 / 6, 2008

Alexander Cockburn
Did the Elites Want MLK Dead?

Ramzy Baroud
There are No Checkpoints in Heaven

Ralph Nader
Runaway Bailouts

David Yearsley
How Scott Joplin Had Wall Street Down

Saul Landau
Sex Politics in America

Paul Craig Roberts
The Petraeus and Crocker Show

Lawrence Korb / Ian Moss
Rev. Jeremiah Wright, a True Patriot

Seth Sandronsky
Meet America's Promise Alliance: Colin Powell's New Gig

John Ross
La Cumbia de la Doctrina Bush: Colombia Kills Four Mexican Students in Ecuador Bombing

Robert Fantina
McCain, Republicans and Family Values

David Michael Green
Back to Disaster: Hoover at Home, Tet Abroad

Missy Beattie
McCan't

Patrick Bond
Vultures Circle Zimbabwe

Dr. Susan Block
The New American Pot Dealers

Phyllis Pollack
The Stones Meet the Press

Adam Engel
The Boobus in the Lie

Jeffrey St. Clair
Booked Up

Poets' Basement
Diamand and St. Clair

Website of the Weekend
Richard Pryor Goes to the Gun Shop

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The Price-Wage Squeeze

The Fed Sinks the Dollar

By MICHAEL HUDSON

Against the recommendations of most economists and even the Financial Times of London, the Federal Reserve Board yesterday cut its discount rate by yet another quarter-point, to just 2%. Ostensibly, the intention is to try and spur economic “recovery” – as if a cut in the interest rates would do this. At first glance this seems to reflect the Fed’s ideology that manipulating the interest alone can expand or contract the economy – as if it is like a balloon, with its structure is pre-printed on it, to be inflated or deflated at will to control the level of activity.

This simplistic philosophy was a hallmark of the Greenspan era. Changing the interest rate alone meant that the Fed didn’t have to “think,” didn’t have to regulate markets, raise reserve requirements on bank loans to fuel the asset-price inflation that the Fed confused with real “wealth creation.” It didn’t have to regulate subprime lending or rain in widespread financial fraud. All it had to do was raise interest rates when this gave banks an opportunity to charge more and increase their earnings – or cut interest rates to lower cost of bank borrowing from the Fed.

But surely not even the ideologically hide-bound Federal Reserve can still imagine that a structural problem – the looming depression from the Fed’s favoritism to the banking sector promoting de-industrialization of the economy – can be solved by lowering interest rates yet again. While the Fed lowers its rate for lending to banks, these banks have not been passing on the rate cuts to their customers. Credit card rates are going up, and entire Christmas trees of penalties are further increasing banks’ rake-off. Mortgage rates remain high, so that real estate markets remain in the doldrums. The banks simply are not lending.

What they are doing is speculating, above all against the dollar. They thus are emulating what Japanese banks did after that nation’s financial bubble burst in 1990. Japan’s banks became the most active players in the international “carry” trade: borrowing at very low interest rates in a weak currency (the yen after 1990, the dollar today) to lend to high-interest borrowers, preferably with strong or at least stable currencies (such as to Iceland before it became so debt-ridden that its currency began to collapse last year; and today, the to European borrowers in euros).

So fiat US credit is being directed to Europe. US banks create or borrow credit at 2%, and lend it out at 6% or more – and get a speculative foreign-currency gain as the euro continues to rise against the dollar.

The aim evidently the same as it was in Japan after 1990. Many banks are nearly insolvent as a result of the b ad real estate loans on their balance sheets. To rescue them (so that it is not necessary to nationalize them, as England recently had to do with Northern Trust) is to help banks “earn their way out of debt” – by making profitable loans.

But bank lending and profitability has become decoupled from the economy at large. Banks are not lending to finance tangible capital investment and new hiring. Helping them thus does not help pull the US economy out of the deepening depression. (A recession is short and is followed by recovery. Today’s looming economic depression is headed toward a widespread forfeiture and transfer of property from debtors to creditors.)

The ultimate effect is to inflate the power of finance, credit and real estate relative to labor’s wages and industrial capital. This is not a way to encourage new tangible investment. It is just the opposite of Keynesianism. Rather than signaling “euthanasia of the rentier,” it is empowering finance and applying euthanasia to labor and industry.

And to Europe, I should add. The Fed’s act to subsidize U.S. bank lending to Europe will help raise the euro’s exchange rate relative to the dollar. This will be a boon to currency speculators. And it will help keep the price of oil and food down to European consumers. But it also will raise the price of European labor and other domestic costs (including the cost of real estate, which is playing a rising role in employee budgets throughout the world). This will tend to make European exports even more expensive in global markets – including the Airbus, much to the joy of Boeing, and European autos, much to the joy of GM and Ford. (No wonder Kirk Kirkorian recently began buying back into the U.S. auto industry.)

In the 1930s, countries competed with one another by imposing rival tariff walls and non-tariff trade barriers (led by the United States) and “beggar my neighbor” currency depreciation (again, led by the United States). But European central bankers for their part are so brainwashed with modern Chicago School monetarist ideology – and so unaware of their own continent’s economic history – that they pursue a knee-jerk reaction to domestic inflation by raising interest rates. This merely increases their currency value all the more, attracting yet more foreign “carry trade” loans. (Economists call this a “backward bending demand curve” and find it an “anomaly,” as they find most reality to be these days.) So while U.S. monetary policy helps subsidize the banking system relative to the industrial sector and labor, European monetary policy goes along with today’s parallel-universe thinking and undercuts its own industry.

An innocent victim of the dollar depreciation caused by the Fed’s action will be Third World food-deficit countries whose currencies are tied to the dollar. Latin America, much of Africa an Asia will find that in their currencies the price of raw materials denominated in euros will rise.

But their domestic wages and other income for the population at large are not increasing. The wage-price squeeze will go on – while their oligarchies no doubt contribute by joining the speculative outflow into hard currencies by moving their domestic funds offshore.

Michael Hudson is a former Wall Street economist specializing in the balance of payments and real estate at the Chase Manhattan Bank (now JPMorgan Chase & Co.), Arthur Anderson, and later at the Hudson Institute (no relation). In 1990 he helped established the world’s first sovereign debt fund for Scudder Stevens & Clark. Dr. Hudson was Dennis Kucinich’s Chief Economic Advisor in the recent Democratic primary presidential campaign, and has advised the U.S., Canadian, Mexican and Latvian governments, as well as the United Nations Institute for Training and Research (UNITAR). A Distinguished Research Professor at University of Missouri, Kansas City (UMKC), he is the author of many books, including Super Imperialism: The Economic Strategy of American Empire (new ed., Pluto Press, 2002) He can be reached via his website, mh@michael-hudson.com