Death by Austerity

There's just no way that the financial crisis in Europe ends well.  All the central bank action designed to ease bank liquidity by providing billions in loans and guarantees would be great if the Euro zone economies were tuning up.  But they're not.  And diving GDP is creating bigger deficits (tax revenues go down while automatic stabilizers kick in to increase government spending) leading austerity cheerleaders to call for more cuts.  In Ireland, where they have been chasing their tail for months, the government is set to announce another round of austerity, this time taking almost 4 billion eu out of the economy.

The British government is warning embassies all across Europe to be on the watch for social unrest, and have created advisories for helping British citizens escape a Eurozone collapse.  Can I point out that the ruling elite in Europe have a pretty crappy record of handling crisis?

SEC Smackdown

Despite the best efforts of the Obama administration to sweep the financial crisis under the rug (along with trillions of dollars in aid to the banks) there are still officials who care.  Judge Jed Rakoff slapped the SEC silly with a ruling on Monday refusing to sign-off on a cozy arrangement between the SEC and Citibank.  The judge was sweeping in his remarks, reminding the SEC that "of all agencies, has a duty, inherent in its statutory mission, to see that the truth emerges; and if it fails to do so, this court must not, in the name of deference or convenience, grant judicial enforcement to the agency’s contrivances…. for otherwise, the court becomes a mere handmaiden to a settlement privately negotiated on the basis of unknown facts, while the public is deprived of ever knowing the truth in a matter of obvious public importance.”

Sometimes the deck seems so stacked against us that I just don't see a way out of this mess.  I remain convinced that we've reached the limits of three critically important systems that rule our lives - the environmental system is teetering, the economic system is completely corrupted, leaving billions of people in abject poverty, and the political systems are woefully inadequate to deal with any of it.  But, just when I think we are doomed, along comes someone like Judge Rakoff, although it remains to be seen if these objections are straws that break a camel's back, or if they are simply nuisance speed bumps on the road to serfdom.  

This post also gives me the opportunity to share a video of Matt Taibbi, who explains the ruling to Keith Olbermann's viewers.  Matt is an interesting guy - he's a terrific writer doing pretty good investigative journalism for Rolling Stone magazine.  His profanity-laced pieces push him to the peripheral of accepted journalism, however, and as much as I dig that about him (see my post about Winnebago Man!) I think he'd be doing the cause a service to limit his vocabulary to the parlance of the day.