Tuesday, April 26, 2005

Peter Orszag is a national treasure. I'm watching the Finance Committee hearing on Social Security. Peter Orszag of Brookings and the Center on Budget and Policy Priorities just had a wonderful metaphor to respond to the idea that private accounts are a "sweetener" or "dessert" to... [The Decembrist] 8:39:33 PM     Notes from the Front: Louisville. I just finished a live interview with FOX, up against Rev. Albert Mohler from the "Justice Sunday" event. Of course, FOX had him live on camera while I was on via telephone (hiding from the wind noise in my rent car) with my picture on screen. DriveDemocracy was described by FOX as "protestors." Mohler was a late switch. I was supposed to be on with Tony Perkins of the Family Research Council. So I wasn't quick enough to remind viewers that Mohler is the fellow who said "I believe that the Roman Catholic Church is a false Church." But I did say that my great grandfather from a few (10) generations back was the last man hanged during the Salem trials (his name was Samuel Wardwell), that I knew religious persecution when I saw it, and that I thought he should retract the organization's statement that Democrats were using the filibuster against people of faith. [BOPnews] 5:04:02 PM     Thanks to Senator Reid. Senate Minority Leader Harry Reid is paying attention to the blogosphere. We get daily memos from his office, and this morning had the honor of engaging him directly in conversation on a conference call. There will, I hope, be more of this — it's extremely useful to have an opportunity to clarify with him points of his agenda, and to hear from his own lips such quotable tidbits as "I do not have a single Senator who is a non-believer." The core of the conversation was the nuclear option and what measures Reid and the Democratic caucus have planned to meet it. [BOPnews] 5:01:06 PM     Paging Howard Beal. This post is not going to tell you anything you don't already know. That said, it probably says a few things about what we see and how we are trained to look. The radical Christian Conservative "anti-filibuster" telecast, "Justice... [BAGnewsNotes] 4:44:07 PM     Bruce Bartlett Is Also Worrying About "Hard Landings". He writes: Bruce Bartlett: Steering clear of a recession: The place where the greatest danger lies is with Fannie Mae and Freddie Mac... even the tiniest mistake by them could roil markets... the impending retirement of Alan Greenspan as chairman of the Fed.... Lastly... [h]uge budget and current account deficits mean that vast amounts of capital flows are necessary to keep them funded. So far, this has gone well... the Chinese have been so accommodating about financing the.... But now the U.S. is strongly pressuring China to stop doing this in order to allow its currency to rise against the dollar. It is hoped that this will reduce China’s production advantage in dollar terms and bring down the bilateral trade deficit. However, the cost to the U.S. economy if this happens could be greater than the potential gain. At least in the short run, any scale-back in China’s buying of Treasury securities might cause interest rates to spike very quickly. This could prick the housing bubble and bring down home prices, eroding personal wealth and putting a squeeze on those with floating rate mortgages. Hopefully, this can all be managed smoothly and without either a recession or a market break.... [Brad DeLong's Semi-Daily Journal] 4:42:08 PM     David Altig on "Hard Landings". From his lair in the Cleveland Fed, David Altig moves the ball forward on the question of how should the Fed watch out for and avoid a "hard landing" whenever Asian central bank dollar-denominated reserve accumulation ceases: http://macroblog.typepad.com/macroblog/2005/04/landings_hard_a.html http://macroblog.typepad.com/macroblog/2005/04/landings_hard_a_1.html http://macroblog.typepad.com/macroblog/2005/04/landings_hard_a_2.html The last is mostly excerpts from a very nice speech by his boss, President Sandra Pianalto of the Cleveland Fed....  [Brad DeLong's Semi-Daily Journal] 4:39:46 PM     A brief break from our regularly scheduled programming to alert our readers that James Wolcott's send up of the blog-spy-cocktail party circuit is quite a hoot.... [War and Piece] 4:38:35 PM     Mainstream Press Blows Condi’s Coverup (war on terrorism) That our new Sec. of State tried to bury the estimate that major world terrorist attacks tripled in 2004 is not news to the blog world. But now MSNBC is running the story via Reuters. Hopefully, a real debate on how best to fight the war on terror will finally begin. Whether this debate gets this White House to take action remains to be seen. - PGL [Angry Bear] 4:37:03 PM     Social Security: Time For An Exit Strategy. From the rally at the Capitol to the results of a new national poll, all signs are pointing to what a Weekly Standard columnist wrote recently: The president and his Republican colleagues need a Social Security exit strategy. [TomPaine.com] 4:35:01 PM     Social Security Cooties. Here's the latest on Social Security:On the eve of the first congressional hearing on the restructuring of Social Security, Republicans on the Senate Finance Committee signaled that they will not insist that personal accounts be part of the... [Political Animal] 1:48:34 PM     A Washington Post analysis says that 'Foreign Policy Disputes Are Subtext in Battle Over Bolton,' as "allegations that Bolton has been abrasive have become a metaphor for the broader problem of the United States' image abroad." [Cursor.org] 1:47:08 PM     As U.N. Ambassador-designate John Bolton is accused of having 'Inflated Syrian Danger,' and of having "no diplomatic bone in his body," Helen Thomas says that President Bush should withdraw the nomination "the sooner, the better." [Cursor.org] 1:46:36 PM     Rolling Stone reports on what it calls 'Bush's Most Radical Plan Yet,' a three-sentence proposal tucked away in the federal budget that "would enable the Bush administration to achieve what Ronald Reagan only dreamed of: the end of government regulation as we know it." [Cursor.org] 1:44:45 PM     Bolton Watch.  "Bolton Waits" (The Telegraph) Bolton Watch Team Agonist | San Antonio | Ongoing Stygius - The Times on Bolton's British Problem In the wake of the Newsweek report on Bolton's ejection from the Libya WMD negotiations in 2003, The Times of London has some more details on Foreign Secretary Jack Straw's fury at John Bolton's 2004 attempt to sabotage Europe's negotiations with Iran: As a series of new allegations against Mr Bolton put his chances of confirmation further into doubt, details emerged of how a furious Mr Straw told Colin Powell, the former US Secretary of State, that Mr Bolton was trying to destroy a European initiative on Iran’s nuclear programme. Mr Straw made the complaint after he became convinced that Mr Bolton was the source of an article on the front page of The Times last July quoting an unnamed senior US official who dismissed the initiative as “spring training” and advocated “regime change” in Tehran. The Times has never revealed its source. More after the jump and more at the link. Laura Rozen has more on the UK-Bolton flap.  [The Agonist] 10:42:13 AM     Scare Tactics. To make its case for Social Security reform, the Bush administration resorts to highly irregular accounting practices. [TomPaine.com] 10:39:37 AM     Working for it . Two-thirds of Americans support Democrats blocking extremist judges, and most also oppose the nuclear option. So, in the face of such public support, what are the Democrats doing? According to the LAT, they plan to take the Broder Option of caving in if the Republicans promise to be nice for the rest of the year. Ahem. Faithful Progressive asks, "So Who Got The Better of it on Sunday?" There's bad news and good news. John Aravosis has an even more sickening update to the MS story: Microsoft paying Religious Right leader Ralph Reed $20,000 a month retainer. "Let's hire Ralph Reed to tell us how to get rid of all that cumbersome good will we've built up over the years!" "It's not about the money!" says Joe Vecchio, but it sure would be a good idea if progressives could get together and support each other instead going off into their own corners to fight their specific causes. The Republicans got that message a long time ago, and have managed to keep each other afloat even though, unlike us, their goals are really in conflict with each other's. The right-wingers actually find ways to pay the people who work for them. The Democratic leadership just asks our folks for more money. Hey, the least you can do is Support Your Local Blogger. Brian Sedgemore, long-time Labour MP, has defected to the LibDems, urging voters to give Tony Blair a "bloody nose" at the polls. He accused the prime minister of telling "stomach-turning lies" over Iraq and using the "politics of fear to drive through parliament a deeply authoritarian set of law and order measures". Charles Kennedy says this undercuts the only real argument Tony Blair has been able to offer for a Labour vote - the risk of letting the Tories in. Kennedy says it's not a credible threat and that the center and left should feel confident of safely voting for the Liberal Democrats. See the finalists for MoveOn's Bush in 30 Years contest. [The Sideshow] 7:22:26 AM     Birds of a feather. After fully investigating ourselves, we have come to the conclusion that we are innocent. And infallible. Under the circumstances, Human Rights Watch is urging the United States to name a special prosecutor to investigate the culpability of high-level officials, including... [Body and Soul] 6:20:02 AM     Japan's Deflation... ...seems to never end. The Japanese economy slowed last year (again), and the BoJ's hoped-for return of moderate inflation remains an elusive goal : Drop in consumer prices pressures Bank of Japan Consumer prices fell for a seventh straight year in the 12 months to end-March 2005, confirming that the economy remains stuck in deflation in spite of three years of stop-start growth. ...The Bank of Japan is on Thursday widely expected to put back its prediction of a return to inflation from this year to next when it publishes a six-monthly report on future trends in prices and economic activity. Last October, the BoJ forecast a return to mild inflation, of 0.1 per cent, in the year to end-March 2006. Sadakazu Tanigaki, finance minister, said: “The causes of deflation are hard to specify, given prices of some products started rising and corporate profits remain firm. But the fact remains that we are in deflation and we must continue efforts to beat it.” Other data released on Tuesday contributed to what economists say is a fuzzy picture of an economy struggling to ease out of last year’s mild recession. Workers’ household spending was up 1.7 per cent in March against the previous year, while seasonally adjusted unemployment fell 0.2 percentage points to 4.5 per cent. Atsushi Nakajima, chief economist at Mizuho, said: “The current situation is far from clear, but I am fairly confident about the economy in the near future.” Mr Nakajima cited continued strong growth in China, Japan’s biggest trading partner, and near-record corporate profits as reasons to be hopeful. Risks came from continued high oil and raw materials prices, as well as what he said were less-than-bright prospects for the US economy. Japan has certainly provided macroeconomists with an excellent demonstration of just how difficult it is to get out of a deflationary cycle once you're in one. This also reminds those of us who worry about the sustainability of BWII just how different the situations of Japan and China are. Unlike China, Japan is unambiguously in the position where the inflationary effects of propping up the dollar are not just tolerable, but to be positively welcomed. But at the same time, it is China that has been forced to continue buying dollar reserves, while the yen's peg against the dollar has been sustained with relatively little intervention from the Japanese authorities in recent months. This type of data makes one think that they'd almost welcome the chance to start intervening again... Kash [Angry Bear] 6:18:25 AM     When Troubled Topper$ Topple. George W. Bu$h is in deep trouble - and he knows it. Bush to Tell Saudis Oil Prices Will Damage Markets President Bush on Monday said he would tell Saudi Crown Prince Abdullah that high oil prices will damage markets... [The Left Coaster] 5:45:20 AM     Showdown In The Caspian: Part I A few days ago, during Condoleeza Rice's visit to Moscow, the news reports all gave the impression that the relationship between the U.S. and Russia was more or less sound, except for a few relatively minor concerns (securing loose nuclear material, Putin's creeping authoritarianism). In other words, here are two natural allies with a few, shall we say, differences of opinion. Fair enough, though not much attention seems to be paid to the thumb wrestling going on over oil and natural gas down in the Caucasus areas. Could this region turn into the source of greater disputes between Russia and the United States, especially as oil continues to grow scarcer and the great powers are forced to jockey for waning resources? Maybe. I don't know. But it sure seems like an important region to understand, so after a bit of googling and reading up, I'm going to try to put together a little primer on the Great Game being played out in the Caucasus region between our two favorite Cold War adversaries. Feel free to point out any mistakes, and I'll patch it up. First, a map will come in handy here: Yeah, that's the ticket. Now as we would expect, Russia under Vladimir Putin is surely trying to ascend to great power status once again. And the road back involves oil. Lots of it. Oil and gas account for about two-thirds of Russia's export revenue and a quarter of its GDP. And most importantly, Russia's trying to dominate the oil-transport game, fighting to make sure that any oil or gas that comes out of the resource-rich Caspian area goes through Russia first. And when I say "resource-rich", I mean resource-fucking-rich: the Soviet republics surrounding the Caspian are all told sitting on up to 200 billion barrels of oil—nearly as much as Saudi Arabia's 250 billion. So the Russian pipelines will do two things in the coming years: a) provide Moscow with a nice chunk of revenue, and b) maintain Russia's influence over the oil producing republics down south. Naturally, the U.S. feels a bit uneasy about Russia having a monopoly on oil transport—ideally we'd like to construct pipelines that go from the Caucus oil and gas producers directly to the Black Sea and Turkey. As you can see in the map above, that means going through Azerbaijan and Georgia. Hence, the multi-million dollar BTC pipeline, which runs from Baku, Azerbaijan, to Tblisi, Georgia, to Ceyhan, Turkey, as follows: Not surprisingly, the U.S. has lavished aid on Georgia for the past ten years—about $800 million—and has been involved in training the Georgian military forces. Russia, meanwhile, has tried to maintain its influence over the region by keeping its forces in the northern autonomous regions of Georgia, including Adzharia, and has shelled out a good deal of aid to two of Georgia's more rebellious provinces, South Ossetia and Abkhazia. (When Georgia tried to invade Abkhazia in 1993, for instance, Russia helped repulse the Georgian force.) The U.S., understandably, is worried that the rebel provinces will stage attacks on the BTC pipeline, or sabotage it, and has prepared the Georgian army for this possibility. I haven't said anything about the much-lauded "rose revolution" that toppled Eduard Shevardnadze in December of 2003. It's no secret that the rise of Mikhail Saakashvili was perfect for the United States—here was a leader who would keep Georgia stable, oppose Russian influence in the region, and call for Russia to withdraw its troops from Abkhazia. A leader who would keep the BTC pipeline safe. Of course the U.S. backed him; they'd be stupid not to. But in the grand scheme of things, I don't think Saakashvili will change the larger dynamic much. Then there's Azerbaijan. If you don't want to pipe Caspian oil and gas through Russia or Iran, it has to flow through Azerbaijan. The BTC pipeline starts in Baku. So the U.S. doesn't try to rock the boat here; the ruling Aliyev dynasty is brutal, having stolen election after election, including most recently the younger Aliyev's sham ascendancy to power in 2003, where security forces beat protestors, and over 300 were ruined. But that doesn't matter: what truly matters is that the elder Aliyev signed a $7.4 billion contract with 10 oil companies back in 1994, including BP, Unocal, and Pennzoil. Needless to say, after the 2003 travesty, Richard Armitage in the State Department quickly made the call to congratulate Aliyev. Warmly. Okay, map-time again! Again, Russia is none too pleased with U.S. influence in Azerbaijan, and has sought to aid and arm the country's longstanding neighbor and enemy, Armenia, as well as the disputed province of Nagorno-Karabakh (that little inset region), which was the source of a five-year war between the two countries. (The U.S., for its part, has been warming towards Armenia in recent years, offering greater economic and military aid.) Is it possible that Russia is hoping to stir up trouble in the region, of the sort that will make the BTC pipeline too unstable to use, forcing the oil to flow back through Russia? Maybe. Maybe not. Recently, it seems that Russia has resigned itself to the BTC pipeline's existence, and may even start investing in it. (More of a concern to oil investors is Iran, which could very well use its terrorist network to sabotage the pipeline. Who knows? Rumors spread like avian flu. Certainly Russia and Iran wouldn't shed too many tears if the BTC were sabotaged and an alternative pipeline, going through Kazakhstan, Turkmenistan and then down through Iran to the Persian Gulf became the main outlet for Caspian oil and gas.) But it's awfully remarkable how one need only follow the pipelines to figure out how and why the great powers are acting in the way they are. Anyway, this is only a rough overview of what's going on east of the Caspian. There's also a whole horde of interesting stuff about pipelines west of the Caspian, involving Kazakhstan, Turkmenistan, Iran, Afghanistan, Russia, the U.S., and—dum, dum—China. But I'll save all that for another post. - Brad [Bradford Plumer] 5:35:06 AM     The Salt Pit. I missed this story when it came out a few days ago, but it's important enough to back to, however late. I've written before about Khaled El-Masri, the German citizen whom the CIA kidnapped and flew to a prison in... [Body and Soul] 5:32:52 AM     Prey together, stay together.  I know some people like to pretend that Libya trembled under the weight of Bush's all-powerful manhood, saw the light, and was transformed, but I didn't know our relationship was this cozy: A British resident has claimed he was tortured... [Body and Soul] 5:31:21 AM     Democratic Senate Strategy. Monday I joined Senator Harry Reid's blogger conference call to hear about how the Democrats plan to resist the Republican abuse of power as Majority Leader Frist leads the Senate off the nuclear option cliff. Senator Reid started the call... [The Left Coaster] 5:29:30 AM     No Child Saved From Gangs . I guess Laura Bush is now a George Bush stand-in. The USA Today story is called Budget shifts funds for gang prevention and the first graf has the usual "Bush doing something good" sound, but of course it's the reverse, as usual: Ten-year-old Alex Baeza, a fifth-grader at Reynolds Elementary School in Tucson, took a few tentative steps toward gang membership but ultimately walked away. His counselors credit federally funded counseling in how to set and achieve goals. The $34.7 million Elementary and Secondary School Counseling program is slated for elimination in President Bush's 2006 budget plan. Blackamericaweb has a different slant on this item: Bush Cutting Anti-Gang Programs While Touting New Initiative: Black congressional Democrats say President George W. Bush has seriously undermined his national anti-gang initiative by eliminating nearly $1 billion in social programs designed to offer young adults -- and black boys in particular -- an alternative to hanging out in the streets. Members of the Congressional Black Caucus maintain that Bush, in his 2006 budget, cut a number of successful after-school programs and grants that were preventing young adults from joining gangs and participating in self-destructive behavior. Where is the money going, then? Into PR, apparently. The chair of the Congressional Black Caucus, Mel Watt (D-NC), says: ""We all know what the problem is; we don't need to study it to death. All they want to do is talk. Bush needs to fund the programs that already exist." Looks like another program to funnel money to people who don't actually know anything but need monetary rewards for being part of the right-wing movement to destroy America. [The Sideshow] 5:25:18 AM

© Copyright 2005 Michael Mussington. Last update: 5/1/2005; 4:29:11 AM.