May 102015
 
 May 10, 2015  Posted by at 12:15 pm Finance Tagged with: , , , , , , , , , ,  


G. G. Bain Metropolitan Opera baritone Giuseppe De Luca, New York 1920

Capitalism is the West’s Dominant Religion (Michael Welton)
Stiglitz: “You Will Have Stronger Growth If You Reduce Inequality” (WEF)
Critical Choices Loom Ahead Of Eurogroup Meeting, IMF Repayment (Kathimerini)
Greece Calls On EU/IMF Lenders To Show Political Will For Deal (Reuters)
Greek Leader Faces Revolt By Party Hardliners As Debt Showdown Looms (Guardian)
The Greek Debt Writedown And Merkel’s Role In It (Kathimerini)
May 7th, 2015 – The Day The United Kingdom Died? (RT)
Sturgeon Vows To End Austerity Across UK (Sky)
An Ever More Fragile Union (FT)
US Urges Greece To Reject Turkish Stream, Focus On Western-Backed Project (RT)
US Trying To Create ‘Unipolar World’ Says Putin (Guardian)
Obama Scolds Democrats On Trade Pact Stance (NY Times)
President Obama Is Badly Confused About the Trans-Pacific Partnership (CEPR)
EU Proposes Plan to Take Up to 20,000 Migrants A Year (WSJ)
Americans Favor Jon Stewart, Colbert Over Conservatives For Punditry (Reuters)

Would anyone in his/her right mind dispute this?

Capitalism is the West’s Dominant Religion (Michael Welton)

David R. Loy, a professor of international studies at Bunkyo University in Japan and a Zen Buddhist teacher, offers us a compelling viewpoint on why we ought to understand our present economic system as the West’s dominant religion. In A Buddhist History of the West (2002), Loy argues that, although religion is “notoriously difficult to define,” if we “adopt a functionalist view and understand religion as what grounds us by teaching us what this world is, and what our role in the world is, then it becomes evident that traditional religions are fulfilling this role less and less, because that function is being supplanted by other belief systems and value systems.” This is a shocking statement for those of conventional religious sensibility. Certainly the monotheistic faith-traditions have not just disappeared into the thin air of modernity.

One could make a solid case that Islamic cultures still contain strong currents of resistance to Western consumer individualism (perceived as decadent and nihilistic). But in the West, Christianity in particular, has lost much of its power to resist the new god that has (and is) conquering the old ones (just like Christianity did in its displacement of Roman deities). Although the monotheistic religions contain many different streams and tendencies (including ascetic and contemplative traditions), these minority anti-materialist traditions have not been able to prevent the market from becoming our “first truly world religion, binding all corners of the globe into a worldview and set of values whose religious role we overlook only because we insist on seeing them as secular” (Loy).

Economics is the new theology of this global religion of the market; consumerism its highest good; its language of hedge funds and derivatives as incomprehensibly esoteric as Christian teachings about the Trinity. “Accumulate, accumulate! This is Moses and the prophets! Marx cried out in the first volume of Capital. Loy wonders why we acquiesce in the appalling realities of global inequities and sleep so peacefully at night. He finds his answer in Rodney Dobell’s explanation that “lies largely in our embrace of a peculiarly European or Western [but now global] religion, an individualistic religion of economics and markets, which explains all of these outcomes as the inevitable results of an objective system in which … intervention is counterproductive.” [..]

We have made fetishes out of commodities as we believe we can derive sensuous pleasure from their magical properties. We sacrifice our time, our families, our children, our forests, our seas and our land on the altar of the market, the god to whom we owe our deepest allegiance.

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Across an entire economy, this may be true. But is it also true for those who profit from inequality?

Stiglitz: “You Will Have Stronger Growth If You Reduce Inequality” (WEF)

Nobel laureate and World Economic Forum on Latin America Co-Chair Joseph E. Stiglitz, Professor, School of International and Public Affairs (SIPA), Columbia University, USA, has urged government and business leaders to make the fight against inequality a priority. Stiglitz was speaking at the 10th World Economic Forum on Latin America, taking place in Mexico. “We used to think there was a trade-off between equality and growth. Now we see the two as complementary. You will have stronger growth if you reduce the extremes of inequality,” he said. Latin America’s success in reducing inequality over the past decade, precisely when the region became more integrated into the global economy and more exposed to international market forces, proves that the increased inequality seen in much of the rest of the world comes from policy choices, Stiglitz said.

Latin America must not give up the fight to reduce poverty and equality – even now when many economies are slowing and government budgets are under pressure – since this fight is crucial for long-term growth. Stiglitz called Mexico’s recent round of structural reforms “very impressive” and said, “I’m very optimistic that these really will spur economic growth.” By breaking monopolies, the reforms will lower consumer prices in sectors such as electricity and the telecoms industry, leading to greater spending power for lower income Mexicans. Lower utility costs will make Mexico more attractive for business investment, which will increase jobs and wages. The reforms will therefore help the country reduce inequality.

Stiglitz criticized the proposed Trans-Pacific Partnership. He cited the negotiations’ secrecy, the proposals that would make governments vulnerable to lawsuits over regulations that protect their citizens, and the proposed expansion of intellectual property rights, especially in the pharmaceutical sector. These expanded IP rights would upset the balance that the United States has already achieved in this area and lead to higher drug prices worldwide, bankrupting some public health systems and putting treatment out of reach for many, he noted. “I am strongly opposed,” he said. As part of the fight against inequality, Stiglitz called for measures to fight racial, ethnic and gender discrimination, and for measures to redistribute resources between richer and poorer parts of a country, such as Mexico’s north and south.

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For the troika, it’s a power game clear and simple.

Critical Choices Loom Ahead Of Eurogroup Meeting, IMF Repayment (Kathimerini)

Greek officials are bracing for a difficult Eurogroup summit in Brussels on Monday after what promises to be a weekend of feverish negotiations with representatives of Greece’s international creditors as European officials increase the pressure on Athens to compromise and avert a default. Prime Minister Alexis Tsipras has been engaged in a flurry of telephone diplomacy in a bid to drum up political support. Meanwhile prominent officials underlined the risks Greece is facing as its coffers run dry and financial obligations loom, notably a repayment of some €750 million to the IMF on Tuesday. Greek officials have expressed the government’s intention to pay the IMF but according to sources some are in favor of not paying if the outcome of Monday’s Eurogroup is not satisfactory.

Such a move would lead to Greece being declared bankrupt within a month with capital controls likely to be imposed on Greek banks much sooner than that to avert a bank run. European officials suggested that Greece should be cautious. “Experience in other parts of the world has shown that a country can suddenly slide into bankruptcy,” German Finance Minister Wolfgang Schaeuble was quoted as telling Frankfurter Allgemeine Zeitung. Other European officials made less dramatic statements, with European Economic and Monetary Affairs Commissioner Pierre Moscovici stressing that reforms are not progressing quickly enough and Eurogroup President Jeroen Dijsselbloem saying Monday’s Eurogroup “won’t be decisive.”

Although a decision that will unlock loan money is not expected on Monday, at the very least Athens is hoping for a statement of support that will allow the ECB to provide some liquidity relief, or at least not turn the screws further. Finance Minister Yanis Varoufakis will represent Greece at the Eurogroup but is to be flanked by Deputy Prime Minister Yiannis Dragasakis or Alternate Foreign Minister Euclid Tsakalotos, who is the new negotiations “coordinator,” or possibly both.

Talks at the technical level continued in Brussels on Saturday with three key sticking points: pension and labor reforms and the level of Greece’s primary surplus, which will determine the extent of economic measures that Athens must take. According to sources, creditors put Greece’s primary surplus for this year at 2% of gross domestic product, at least 1% above Athens’s estimate. Talks were also said to focus on possible tax increases, particularly likely plans for a flat value-added tax rate. Although Greek officials insist they have made significant concessions, and Tsipras has called on Europe to show “political will” opposite Athens, it appears that creditors want to see signs of concrete progress – and legislation – before they issue a statement of support, much less unlock funds.

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Lots of polls being held designed to put pressure on Syriza.

Greece Calls On EU/IMF Lenders To Show Political Will For Deal (Reuters)

Greece’s main debt negotiator called on the EU and the IMF to show their willingness to break an impasse in debt talks, ahead of a crucial meeting of euro zone finance ministers on Monday. Prime Minister Alexis Tsipras’ leftist-led government, which came to power promising to end the austerity terms under Greece’s existing €240 billion debt deal, has been locked for months in talks with its foreign lenders over reforms that could unlock much needed bailout funds. “Any delay in achieving this compromise has to do with one and only one reason, and this is the political differences between the government and the institutions,” Euclid Tsakalotos, Greece’s newly appointed coordinator of the talks, told Avgi newspaper.

With bailout aid frozen while it is shut out of debt markets, Athens risks running out of cash unless a deal is reached soon. “After weeks of laborious negotiations, if there is a real will from the other side, it will be clear that the discussion has reached a level where an agreement is very close and will be reached in the coming period,” Tsakalotos said. Athens’ foreign creditors are demanding further austerity in exchange for funds, while an angry Greek public has felt the pain of income cuts amid a six-year recession.

A poll by MRB for Sunday’s Realnews showed that 72% of Greeks wanted what Athens calls an “honorable compromise”, meaning concessions from both sides to reach a deal. A March survey showed that 57% wanted Athens to stick to its “red lines” on pension and labor reforms. Tsipras will hold a wider cabinet meeting on Sunday, a day before euro zone finance ministers discuss progress made so far in the negotiations. Greece needs to pay a €750 million IMF loan this week and pensions and public sector wages at the end of the month, and Athens hopes for the European Central Bank to allow Greece to raise cash by issuing more Treasury bills. “It’s now the political side that must offer a solution,” Economy Minister George Stathakis told Avgi.

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Helena Smith’s coverage from Athens for the Guardian is not getting better as time goes by. She looks a bit lost.

Greek Leader Faces Revolt By Party Hardliners As Debt Showdown Looms (Guardian)

The epic struggle to keep Greece solvent and in the eurozone intensified on Saturday night amid signs of a looming crisis within the anti-austerity government that took Europe ablaze barely three months ago.As prime minister Alexis Tsipras scrambles to secure a financial lifeline to keep the debt-stricken country afloat, hardliners in his radical left Syriza party have also ratcheted up the pressure. In a make-or-break week of debt repayments, the politician once seen as the harbinger of Europe’s anti-establishment movement has found himself where no other leader would want to be: caught between exasperated creditors abroad and enraged diehards at home.

With government coffers almost at nil and Athens facing a monumental €750mloan instalment to the IMF on Tuesday, it is the last act in a crisis with potentially cataclysmic effect. Either Tsipras betrays his own ideology to deter default – reneging on promises that got him into power – or he goes down as the man who allowed his country to do what no other EU member has done: enter the uncharted waters of euro exit. It is a moment of truth with consequences far beyond the borders of Greece. “No doubt he is having nightmares about betraying ideas that he has held dear all his life,” said Aristides Hatzis, associate professor of law and economy at Athens University. “To make such a U-turn he is going to have to cross red lines that require a leap of faith I am not sure he has.”

The protracted standoff between Athens and the European Union and IMF – the bodies that have bailed out the country to the tune of €240bn since 2010 – has brought Tsipras to this point. To the dismay of inexperienced politicians in his left-dominated coalition, creditors have dug in their heels with cash reserves drying up inexorably as negotiations over a deal to unlock further bailout funds have gone to the wire.

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2nd part in the series.

The Greek Debt Writedown And Merkel’s Role In It (Kathimerini)

In his personal notes dated a day before the June 2012 general elections, Greece’s caretaker Prime Minister Panayiotis Pikrammenos wrote: “Anxiety is mounting. Anxiety in every respect – even and particularly regarding the banks. The telephone call with [German] Chancellor [Angela] Merkel went very well. […] I gave her a general briefing and then discussed my communications with [European Commission President Jose Manuel] Barroso and [European Council President Herman Van] Rompuy. She was strict on this point. Greece’s declaration that it would abide by its commitments was not enough. She wanted a clear statement that there would be no request for a renegotiation of the memorandum, as is being so gratuitously promised in pre-election campaigns. ‘

They,’ she said – referring to the Commission – ‘do not have to answer to parliament.’” It was the most dramatic moment, up until then, of a crisis that showed no signs of abating – and which was threatening to drag the global economy into another recession. Twenty-five months after having approved, under pressure from a rapidly deteriorating situation, Berlin’s participation in the first bailout package for Greece, the German chancellor was without dispute the dominant figure on the European stage. In the period following the first Greek bailout and up until the end of 2011, she had managed to convince her eurozone partners to adopt new measures imposing fiscal discipline, while at the same time resisting calls for the mutualization of public debt, for example via the issue of eurobonds.

On the question of Greece she decided on a restructuring of the country’s soaring debt. This process, which took four months of negotiations and was completed (with all the requisite prior actions) just days before the first of two general elections in Greece in May 2012, at first appeared to be a success both because of the response from the private sector and because any legal difficulties had been avoided.

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No, it happened prior to that date.

May 7th, 2015 – The Day The United Kingdom Died? (RT)

Nobody doubts the UK General Election delivered an extraordinary outcome. However, in the long term, May 7th 2015 could eventually be remembered as the day the UK croaked it. The pundits and pontificators spun Election 2015 as a close run vote, certain to deliver a hung parliament. They were misguided. Instead, David Cameron reigns supreme with an overall majority for his Conservative Party and Ed Miliband, Nick Clegg and Nigel Farage have all resigned. While the latter will probably reappear without much delay, the first two are now consigned to the wastebasket of history. In a single day, Miliband has gone from being the favorite to enter 10 Downing Street to the back-benches.

Meanwhile, David Cameron has spent the afternoon kicking back with the Queen. It all sounds like nothing has changed. This is wrong. Everything has changed. While the immediate analysis focuses on the destruction of political careers, May 7th 2015 has greater significance. It was the day the United Kingdom, as it’s presently constituted, entered its endgame. The Conservative majority and the SNP’s Scottish landslide mean checkmate for the union. Had Labour, as expected by pollsters, formed the next government, the UK’s current composition would have been safe, at least in the short-term. Instead, we have witnessed the triumph of nationalism, both Scottish and English, and the squeezing of the middle ground. There’s a smell resonant of Czechoslovakia in 1992 wafting from Britain.

David Cameron is now honor bound to hold an “in-or-out” referendum on Britain’s membership of the EU before the end of 2017. It’s increasingly clear that the electorate will vote to leave. However, it won’t be the UK that decides to abandon the EU project, it will be England. Scotland, Wales and Northern Ireland will almost certainly vote to remain as members. This, I believe, will be catalyst for a second Scottish independence poll and the subsequent establishment of a Scottish state. Scotland’s needs are different from those of England and Edinburgh needs access to the world’s largest market in order to realize its dreams.

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Crucial point.

Sturgeon Vows To End Austerity Across UK (Sky)

Nicola Sturgeon has vowed to carry an anti-austerity message to Westminster after the SNP gained a record 56 seats in the Commons. The SNP leader addressed her new MPs in Edinburgh and told them to “work with others” in Parliament to end austerity across the United Kingdom. “Let us be very clear – the people of Scotland voted for an SNP manifesto that had ending austerity as its number one priority and that is the priority for these men and women to now take to the very heart of the Westminster agenda,” she said. “We will continue to reach out to people of progressive opinion right across the UK so that we can put ending austerity, investing in public services like our precious NHS, investing in a stronger economy to get more young people in jobs… We will work with others to put those priorities right at the heart of Westminster.”

Voters granted the Conservatives a surprise majority on Thursday, but in taking all but three of Scotland’s 59 seats, the SNP ensured they will be hard to ignore in the new-look House of Commons. Ms Sturgeon had a brief conversation with the Prime Minister on Friday, agreeing to face-to-face talks “as soon as possible” – an early indication of the First Minister’s likely influence over the next five years. She told her audience in front of the Forth Bridge: “As I told the Prime Minister when I spoke to him yesterday, it simply cannot and will not be business as usual when it comes to Westminster’s dealings with Scotland.

“Scotland this week spoke more clearly than ever before and my message to Westminster is that Scotland’s voice will be heard there more loudly than it has ever been before. “Our job is to repay the trust you have shown in us and I pledge today that that’s exactly what we’ll do. “We will not let you down.” While a left-of-centre alliance would not be able to outvote a united Tory party in the Commons, the situation may change if Conservative backbenchers become restless. Ms Sturgeon’s predecessor and the new MP for Gordon, Alex Salmond, has predicted the Tory majority will “erode and change within months”.

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Not the EU.

An Ever More Fragile Union (FT)

Britain has a Conservative government. David Cameron has confounded the pollsters, and left egg on the faces of the pundits blindsided by their predictions — this columnist among them. The Tory leader has led his party to its first outright victory since Sir John Major pulled off the same trick in 1992. Perhaps it is more than a coincidence that the young Mr Cameron served as an aide to the then prime minister. He should savour the moment. The election also told the story of two nations — a Scotland that handed a spectacular victory to Nicola Sturgeon’s Scottish National party alongside an England that cleaved to an increasingly parochial Tory party. The destruction of the centrist Liberal Democrats amplified the sense of polarisation. Ahead lie dangerous times — for Britain and for Mr Cameron’s Conservatives.

Two great questions are set to shape British politics: the fragile future of the four-nation union and the UK’s permanently irascible relationship with the rest of Europe. For Mr Cameron, they promise only trials and tribulations. History may well see the real significance of the election in the collision between resurgent Scottish, and resentful English, nationalism, the point at which the divisive politics of identity upturned the old order. The SNP’s landslide was widely forecast. The consequences are no less seismic for that. The election reopened the question that should have been settled by the No vote in last year’s independence referendum. Alongside their grip on the devolved government in Edinburgh, the nationalists now hold 56 of the 59 Scottish seats at Westminster.

For the first time since the arguments about Irish home rule at the turn of the 20th century, an overtly nationalist party has become the third force in the UK parliament. The SNP is celebrating Mr Cameron’s return to Downing Street. The election saw Scotland turn left, and England right. Nothing could better fit Ms Sturgeon’s insidious narrative of a progressive Scotland forever shackled by a Tory-led England. Here, Mr Cameron must now live with the consequences of his own campaign. There are many reasons why England voted Tory — not least the Labour leader Ed Miliband’s alternative prospectus for socialism in one country. But Tory strategists were unabashed in stirring the embers of English nationalism in order to neutralise the UK Independence party and stoke fears among the undecided that a Labour government would “sell out” to the Scots.

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Yawn.

US Urges Greece To Reject Turkish Stream, Focus On Western-Backed Project (RT)

Washington is pushing Athens not to abandon a Western-backed Trans-Adriatic Pipeline (TAP) project in favor of the Russia-proposed Turkish Stream, a pipeline that would bring Russian gas to Europe via Greece. Greece should consider joining the TAP, which will link Europe to natural gas supplies from Azerbaijan via Turkey, Greece, Albania and the Adriatic Sea, top US energy diplomat Amos Hochstein said after talks with Greek officials, Reuters reported on Friday. “Turkish Stream doesn’t exist. There is no consortium to build it, there is no agreement to build it. So let’s put that to the side, and wait until there’s some movement on that and see if that’s relevant or not relevant and in the meantime focus on what’s important – the pipeline we already agreed to, that Greece already agreed to”, Hochstein claimed.

He didn’t give any details on the meeting with Greek officials, saying that they “more agreed than disagreed.” Greek Energy Minister Panagiotis Lafazanis, however, responded that the country would continue supporting the Russian gas pipeline. “We are backing this project because we think it will be useful for our country,” the minister said in a statement after the talks. The US envoy said that the US position was the best way for Europe to secure its energy supply is by diversifying its sources and ensuring competition. He also added that having other gas sources would “help with price, reliability of supply, and that will help take the political element out of the supply system.” Meanwhile, on Thursday Putin reportedly told Greek PM Alexis Tsipras during a phone conversation that Russia was ready to consider providing financial support for Greek companies that join the Russian pipeline project.

Tsipras confirmed his country’s readiness to participate in the Turkish Stream project. Earlier in April during the Greek PM’s official visit to Moscow, Putin and Tsipras agreed to collaborate in the construction of a new pipeline, to be part of the Turkish Stream project, which would deliver Russian gas to Europe via Greece. The Russian president said at that time that by joining the project Greece could become one of the main power distribution centers in Europe, and earn hundreds of millions of euros annually from gas transit fees. The Greek PM voiced interest in the proposal, claiming that the project could be a way to boost jobs and investment in the Greek economy. Cash-stripped Greece can also use revenues from potential joint projects with Russia to pay off debt to international creditors.

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It’s a disgrace Obama and Merkel et al refused to go to Moscow. A slap in the face of millions who died in WWII.

US Trying To Create ‘Unipolar World’ Says Putin (Guardian)

Vladimir Putin has used an address commemorating the 70th anniversary of victory over Nazi Germany to accuse the US of attempting to dominate the world. Speaking at Moscow’s annual Victory Day parade in Red Square, which this year has been boycotted by western leaders over the continuing crisis in Ukraine, the Russian president berated Washington for “attempts to create a unipolar world”. Putin said despite the importance of international cooperation, “in the past decades we have seen attempts to create a unipolar world”. That phrase is often used by Russia to criticise the US for purportedly attempting to dominate world affairs.

The US president, Barack Obama, has snubbed the festivities, as have the leaders of Russia’s other key second world war allies, Britain and France, leaving Putin to mark the day in the company of the leaders of China, Cuba and Venezuela. The German chancellor, Angela Merkel, has likewise ducked out of attending the parade but will fly to Moscow on Sunday to lay a wreath at the grave of the Unknown Soldier and meet the Russian president. As western sanctions on Russia over its actions in Ukraine continue to bite, Moscow has increasingly appeared to pivot away from Europe and focus more on developing relations with China.

The Chinese leader, Xi Jinping, will be the most high-profile guests on the podium next to Putin. Other presidents in attendance include India’s Pranab Mukherjee, president Abdel Fatah al-Sisi of Egypt, Raúl Castro of Cuba, Nicolás Maduro of Venezuela, Robert Mugabe of Zimbabwe and Jacob Zuma of South Africa. Russia used the parade to show off its latest military technology, including the Armata tank, in the parade, which included 16,000 troops and a long convoy of weapons dating from the second world war to the present day. Also on show for the first time was a RS-24 Yars ICBM launcher, which Moscow has said described as a response to US and Nato anti-missile systems.

The celebrations stand in contrast to the festivities a decade ago, when Putin hosted the leaders of the United States, France, Germany, Italy and Japan. The Soviet Union lost about 27 million soldiers and civilians in what it calls the “great patriotic war” – more than any other country – and the Red Army’s triumph remains an enormous source of national pride. On Saturday morning, many Muscovites sported garrison caps and black and orange striped ribbons that have become a symbol of patriotism in recent years. More than 70% of Russians say a close family member was killed or went missing during the war, making Victory Day an emotional symbol of unity for the nation.

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The pusher man.

Obama Scolds Democrats On Trade Pact Stance (NY Times)

President Obama on Friday lashed out at critics within his own party as he accused fellow Democrats of deliberately distorting the potential impact of the sweeping new trade agreement he is negotiating with Asia and standing in the way of a modern competitive economy. With the cutting tone he usually reserves for his Republican adversaries, Mr. Obama said liberals who are fighting the new trade accord, the Trans-Pacific Partnership, were ”just wrong” and, in terms of some of their claims, ”making this stuff up.” If they oppose the deal, he said, they ”must be satisfied with the status quo” and want to ”pull up the drawbridge and build a moat around ourselves.”

”There have been a bunch of critics about trade deals generally and the Trans-Pacific Partnership,” he told an estimated 2,100 workers at the Nike headquarters here. ”And what’s interesting is typically they’re my friends coming from my party. And they’re my fellow travelers on minimum wage and on job training and on clean energy and on every progressive issue, they’re right there with me. And then on this, they’re like whupping on me.” But Mr. Obama said that he had no political motive for supporting freer trade with Asia. ”I’ve run my last election,” he said. ”And the only reason I do something is because I think it’s good for American workers and the American people and the American economy.” And so, ”on this issue, on trade, I actually think some of my dearest friends are wrong. They’re just wrong.”

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The pusher man doesn’t know what he’s pushing.

President Obama Is Badly Confused About the Trans-Pacific Partnership (CEPR)

That was the main takeaway from a NYT article on his trip to Nike. According to the article, he made many claims about the Trans-Pacific Partnership (TPP) and opponents of the deal which are clearly wrong. For example, the article tells readers: “he [President Obama] scorned critics who say it would undermine American laws and regulations on food safety, worker rights and even financial regulations, an implicit pushback against Ms. Warren. ‘They’re making this stuff up,’ he said. ‘This is just not true. No trade agreement’s going to force us to change our laws.'” President Obama apparently doesn’t realize that the TPP will create an investor-state dispute settlement mechanism which will allow tribunals to impose huge penalties on the federal government, as well as state and local governments, whose laws are found to be in violation of the TPP.

These fines could effectively bankrupt a government unless they change the law. It is also worth noting that rulings by these tribunals are not subject to appeal, nor are they bound by precedent. Given the structure of the tribunal (the investor appoints one member of the panel, the government appoints a second, and the third is appointed jointly), a future Bush or Walker administration could appoint panelists who would side with foreign investors to overturn environmental, safety, and labor regulations at all levels of government. (Think of Antonin Scalia.) President Obama apparently also doesn’t realize that the higher drug prices that would result from the stronger patent and related protections will be a drag on growth. In addition to creating distortions in the economy, the higher licensing fees paid to Pfizer, Merck, and other U.S. drug companies will crowd out U.S. exports of other goods and services.

Obama is also mistaken in apparently believing that the only alternative to the TPP is the status quo. In fact, many critics of the TPP have argued that a deal that included rules on currency would have their support. This issue is hugely important, since it is highly unlikely that the U.S. economy will be able to reach full employment with trade deficits close to current levels. (It could be done with larger budget deficits, but no one thinks this is politically realistic.) Without a considerably tighter labor market, workers will lack the bargaining power to achieve wage gains. This means that income would continue to be redistributed upward.

The only plausible way to bring the trade deficit down is with a lower valued dollar which would make U.S. goods and services more competitive internationally. The TPP would provide an opportunity to address currency values, as many critics of the trade agreement have pointed out. It seems that Mr. Obama is unaware of this argument.

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One word: rudderless. Has it already been 10 days since they said 5,000?

EU Proposes Plan to Take Up to 20,000 Migrants A Year (WSJ)

The European Union may accept up to 20,000 refugees a year and set up an automatic redistribution program for migrants overcrowding southern European states, under plans currently being developed in Brussels. The proposed distribution among EU states of people who haven’t yet entered the bloc would use a formula that takes into account the size of the population, the strength of the economy and unemployment rates in each country, as well as the number of refugees they have taken in so far, according to a draft text seen by The Wall Street Journal. The text is due to be adopted by the European Commission—the bloc’s executive—on Wednesday. The 16-page “European Agenda for Migration” comes in response to the refugee crisis Europe is facing notably from the south, after thousands of migrants have died in their attempt to cross the Mediterranean and reach EU countries.

The United Nations has called on the EU to take up to 20,000 refugees a year, directly from camps outside the EU—for instance from Turkey or Lebanon, where most of the four million people who fled the Syrian war are currently located. Under the plan, an EU-wide “resettlement scheme” to meet or get close to that target will be proposed by the end of May and funded with €50 million ($56 million) in 2015-16. The exact number of places for refugees is still the subject of discussions within the commission, where 28 commissioners from each EU country have a say on the matter. “Expect a last-minute quarrel in the college of commissioners on the 20,000 resettlement figure,” one EU official said.

Commission chief Jean-Claude Juncker is the main driver behind this initiative, which has the backing of the German government, two EU diplomats confirmed. Germany and Sweden have so far taken the bulk of refugees in Europe and insist that a “voluntary system” doesn’t mean other countries should shirk their responsibilities. The program wouldn’t be binding for the U.K., Ireland and Denmark, which have opted out of the EU asylum system. If national governments agree to take refugees from outside the EU, the same distribution “key” may be used for “automatic relocation” of migrants who are already in Italy, Malta or Greece. “We have to start somewhere. Agreeing on refugees outside the EU may be easier, because they are the most in need. Then, we may move on to relocation within the EU,” one EU diplomat said.

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For what it’s worth.

Americans Favor Jon Stewart, Colbert Over Conservatives For Punditry (Reuters)

Jon Stewart has spent 16 years skewering U.S. politicians and media as the liberal host of television’s “The Daily Show” – and many Americans think he gets it right on the issues with his satirical look at the news. In a Reuters/Ipsos online poll, the Comedy Central comic topped a list of 10 pundits, with more than half of respondents saying they agreed with him on at least some issues. Only 12% did not agree with him on any issues at all. Stewart, who will host his last Daily Show episode on Aug. 6, also ranked highest on two other traits – fearlessness and most admired. Of the 2,013 people 18 and older polled, nearly half found him unafraid in confronting “issues that others ignore,” while 48% said they admired him.

Daily Show alumnus Stephen Colbert, who spoofed conservative talk-show hosts for nearly a decade on Comedy Central’s “The Colbert Report,” tied Stewart as most admired and placed second to him on issues and fearlessness. Colbert will soon take over hosting “The Late Show” on CBS. By contrast, only 34% of respondents agreed with Rush Limbaugh. The fiery conservative talk show host was the least admired commentator on a list that also included political satirist Bill Maher, Fox News commentator Bill O’Reilly and conservative author Ann Coulter. Nearly 90% of respondents were familiar with Limbaugh’s work, the most for any commentator. [..] O’Reilly was the best performing conservative in the poll, finishing third behind Stewart and Colbert with viewers on confronting tough issues and on sharing the same views. He scored 43% in both areas. He was fifth on the list of most admired pundits behind Stewart, Colbert, Maher and Briton John Oliver, another Daily Show veteran who now anchors a similar program on HBO.

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