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Wednesday 05.02.2012

Time to Accumulate Gold and Silver
By Jeff Clark - DailyReckoning.com
05/01/12 Do you own enough gold and silver for what lies ahead?
If 10% of your total investable assets (i.e., excluding equity in your primary residence) aren't held in various forms of gold and silver, we at Casey Research think your portfolio is at risk.
After speaking at the Cambridge House conference last month and talking with many attendees, I came away convinced that most investors fall into one of two categories: those who hold an abundance of gold and silver (which tends to be physical forms only), and those with little or none. While both groups need to diversify, I'm a little more concerned about the second group. Here's why.

Gold Seen Advancing on Central Banks Stimulus Speculation
By Debarati Roy and Nicholas Larkin - Bloomberg.com
Gold may decline for the second straight day as signs of stronger industrial growth in the U.S. boosted prospects for the economy and eroded the appeal of the precious metal as a haven.
The Standard & Poor's 500 Index rose as much as 0.9 percent, after declining 0.4 percent yesterday, as the Institute for Supply Management's factory index rose to 54.8 in April from 53.4 in March, the Tempe, Arizona-based group's report showed. Economists had forecast a reading of 53, according to the median estimate in a Bloomberg survey. Before today, the precious metal gained 6.2 percent this year.

Preparing for a Lengthy and Unpredictable US Dollar Crisis
By Eric Fry - DailyReckoning.com
05/01/12 Laguna Beach, California – "On the threshold of a crisis," we observed in our essay "Investing Ahead of the Curve" in the July 19, 2011 edition of The Daily Reckoning, "a fertile imagination can be an investor's most valuable asset."
"During normal times," we continued, "investors can focus only on buying quality stocks one by one from the bottom up, without also trying to envision what tragedies might befall them from the top down… But it may be time to begin imagining the unimaginable.
"It may be time, in other words, to begin considering that the next phase of the global monetary system might not include the US dollar as its reserve currency…or that the next two decades of life in America might not look anything like the last two decades."

Spain Default Could Hit US Market 10%-20%: Economist
By: Margo D. Beller - CNBC.com
Spain's newly announced recession won't be ending any time soon and it could force the U.S. stock market to fall anywhere between 10 percent and 20 percent, economist Harry Dent told CNBC Monday.
"Spain is going to default. The markets are in total denial on this," Dent, author of "The Great Crash Ahead," told CNBC's "Squawk on the Street." "It's a question of whether it's going to happen sooner or later."
Dent spoke after Standard & Poor'sdowngraded 16 Spanish banks and the nation announced first-quarter gross domestic product figures that showed the country to be in recession.
Spain's problems are far worse than what happened in Greece, he added.

Electoral silence on France's slow economic decline
France's economy has weathered the global crisis of the last five years deceptively well, shielded by a Leviathan state and the postponement of hard choices.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Yet the underlying decline that began 30 years ago has gathered speed. France's share of eurozone exports has dropped from 17pc to 13pc since 2000. Spain, Benelux and Germany have done much better.
"France is coddled with illusions," said Jean Peyrelevade, ex-head of Credit Lyonnais. "Economic decline is the brutal, hard, undeniable reality. We are consuming the leftovers of a past prosperity."

Art Cashin Issues His Latest Warning On Egypt
Submitted by Tyler Durden- ZeorHedge.com
Last week, when we discussed the recent ominous gas deal cancellation between Egypt and Israel we warned that the May Egyptian presidential election is the one that nobody is concerned about, yet should be far more prominent on everyone's radar, especially in the aftermath of not only the recent deterioration of Egypt-Israel relations, but also the withdrawal of the Arabian ambassador from Cairo. Art Cashin is one person who has been following this underreported hotbed of geopolitical tensions and has just issued his third warning of what he calls another "nose to nose" in the middle east. Issue is this particular nose has all the leverage courtesy of a little canal that has a huge impact on the most important asset price in the world.
From UBS Financial Services
Egypt Bears Watching Closely - Bob Hardy's excellent GeoStrat site had a couple of keen insights on Egypt. (We hear the site is getting popular among the hedgies.) Bob did a thorough analysis of the rather confusing electoral setup. Here's a small segment:

Saudi Arabia and the Egyptian 'no'
By ABDUL RAHMAN AL-RASHED - AlArabiya News
The word "no" is the most prevalent in the Egyptian scene right now. Scores of noes are reiterated daily on the local level: no to military trials, no to remnants of the former regime, no to the military council, no to presidential elections before drafting the constitution, no to the constituent assembly, no to the elections commission, and no to postponing presidential elections.
The international level has also had its share of those noes: no to borrowing from the World Bank, no to American aid, no to exporting natural gas to Israel, no to closing down NGOs and so on. The latest no is to Saudi Arabia and follows the arrest of an Egyptian man called Ahmed al-Gazawi at Jeddah Airport for possession of banned drugs.

Saudi Arabia closes Cairo embassy,
recalls ambassador due to protests over detained Egyptian
AP - WashingtonPost.com
RIYADH, Saudi Arabia — Saudi Arabia closed its Cairo embassy Saturday and recalled its ambassador following protests over a detained Egyptian human rights lawyer in a sharp escalation of tension between two regional powerhouses already on shaky terms due to uprisings in the Arab world.
The unexpected Saudi diplomatic break came following days of protests by hundreds of Egyptians outside the Saudi Embassy in Cairo and consulates in other cities to demand the release of Ahmed el-Gezawi. Relatives and human rights groups say he was detained for allegedly insulting the kingdom's monarch.

New York Fed: Leave the Building!
Mises Daily: by Robert Wenzel
[At the invitation of the New York Federal Reserve Bank, Robert Wenzel spoke and had lunch in the bank's Liberty Room on April 25, 2012. Below are his prepared remarks.]
Thank you very much for inviting me to speak here at the New York Federal Reserve Bank.
Intellectual discourse is, of course, extraordinarily valuable in reaching truth. In this sense, I welcome the opportunity to discuss my views on the economy and monetary policy and how they may differ with those of you here at the Fed.
That said, I suspect my views are so different from those of you here today that my comments will be a complete failure in convincing you to do what I believe should be done, which is to close down the entire Federal Reserve System.

Dallas Fed: Why We Must End TBTF Now!
Submitted by Tyler Durden - ZeroHedge.com
"We're on the road to economic stagnation" is how the Dallas fed describes the status quo as Too-Big-To-Fail (TBTF) is forcing the US economy to suffer from the perpetuation of perverse incentives. We want to get back on the path to prosperity and they note that there are some things monetary policy can't fix (well we know that already) but in this case they demand an end to the TBTF paradigm now. In an excellent presentation of the costs and benefits of ending TBTF (defined rather tongue-in-cheekily: The unwillingness of a government entity to abruptly close an insolvent company and force its creditors to sustain sizable losses due to the company's size, complexity, interconnectedness and general significance within the financial system), the ignorance of the process of creative destruction is critical as they note that a sick (or failed) bank cannot lend: "Undercapitalized banks gum up the working of the interdependent moving parts of the monetary policy engine". Dismissing the Dodd-Frank Act as a distraction that doesn't buttress market discipline, they summarize their guiding principles as: End banking oligopoly power; punish failure quickly; and change the do-or-die (M.A.D.) decision-making paradigm; ending with the threat promise suggestion that Restructuring isn't so radical, firms do it all the time.

Gerald Celente --
Ian Henschke ABC Australia - 26 April 2012

Tuesday Never Comes
Bill Gross - Pimco.com
The global economy is floating on an ocean of credit, and a good thing too as our cartoon friend Wimpy reminds us. Without it, he would be a hungry puppy by next Tuesday and nearly seven billion world citizens would be worse off if barter, and not credit, was the oil that lubricated trade. Unlike Wimpy, early societies functioned without an exchange (money) or the promise to pay it back in the future (credit). Growth was limited, however, because savings or investment could not be incented properly. Those that wanted to save for a rainy day had no means to express that caution; better to consume a banana or a hamburger today than to watch it rot and become worthless on Tuesday. But money changed all of that and the ability to borrow and exchange it for repayment at some future date was the economic elixir of the ages. Shakespeare, with his admonition to "neither a borrower nor a lender be," might have won a 17th century Pulitzer, but definitely not a Nobel Prize for economics.

Pimco's El-Erian: The Fed needs some help
El-Erian: Spain could make or break Europe
By Catherine Tymkiw @CNNMoneyInvest
LOS ANGELES (CNNMoney) -- The U.S. economy is on the right path but it's not moving fast enough, said Pimco Chief Executive Mohamed El-Erian.
El-Erian told CNNMoney at the Milken Institute Global Conference in Los Angeles that those who expect a speedy recovery will be disappointed.
"People differ on what the economy will do, and in assessing what should happen versus what's likely to happen," he said, adding, "the economy will unfortunately weaken because it faces significant headwinds from outside."
Take the most recent gross domestic product figures.

Keiser Report: Oh My Gun! (E281)

Manufacturing in U.S. Unexpectedly Expands at a Faster Pace
By Alex Kowalski - Bloomberg.com
Manufacturing unexpectedly expanded in April at the fastest pace in 10 months, driven by gains in orders and production that signal the U.S. remains a source of strength for the global economy.
The Institute for Supply Management's factory index climbed to 54.8 last month, exceeding the most optimistic forecast in a Bloomberg News survey, from 53.4 in March, the Tempe, Arizona- based group's report showed today. Readings greater than 50 signal growth. The median forecast in the Bloomberg survey called for a drop to 53. Measures of production and orders were the highest in a year.

GE brings manufacturing jobs back to U.S.
GE shipped much of its appliance production overseas, relying on cheap labor to bring down costs. But wage increases in China and the willingness of the American worker to accept lower wages have GE bringing jobs back to the U.S., reports Dean Reynolds.
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More seniors renting, sharing, swapping big ticket assets.
Sharing-for-Cash: A New Way to Finance Retirement
Deana Shelby and her husband, Dave Klemer, can thank honeymooners for making their dream retirement in Hawaii a reality.
The couple moved to an oceanside home on the island of Kauai when Klemer retired from his job in the computer industry in 2007.
Their property included a one-bedroom cottage, which the couple dubbed "The Honeymoon Cottage," and is available for rent at about $150 a night. In addition to a property manager, they use the web to woo guests, who are also charged $30 a day for Internet access and $20 for rides to and from the airport.

Washington Stuck Fighting Wrong Health-Care Battle
By Peter Orszag - Bloomberg.com
While Washington wonks continue to bicker over health policy, positive change is occurring outside the Beltway.
Last week, the Altarum Institute, a research organization based in Ann Arbor, Michigan,reported that the moderation in the growth of health-care costs we have seen over the past few years is continuing: Total health spending rose by less than 4 percent from February 2011 to February 2012. And it's encouraging to see the progress that doctors, hospitals and other providers are making to improve the value of care -- by cutting back on unnecessary procedures, for example, expanding their use of information technology, and switching from fee-for- service to compensation schemes aimed at maximizing the quality of treatment.

The Current State of Medicare
Medicare, Health Care, U.S. Economy
Henry J. Aaron, Senior Fellow, Economic Studies
House Ways and Means Subcommittee on Health
At a hearing today before the House Ways and Means Subcommittee on Health, Henry Aaron argues for retaining and improving the current Medicare program.
In my statement I shall emphasize the following points:

• Medicare has been an overwhelming success in providing access to care for groups that before its enactment had only limited access to insurance or standard health care. It is popular across the political spectrum. Polls reveal that people would rather raise taxes than cut its benefits.
• Neither part B nor D faces any problem insolvency. They are adequately funded in perpetuity under current law.
• The Part A trust fund is currently in better shape financially than it has been for most of its history. If all provisions of the Affordable Care Act are enforced, its financial gap is small.
• Many are concerned over Medicare's long-term affordability. If provisions of the Affordable Care Act are enforced, the added budget costs of Medicare over the next quarter century are modest and affordable.

Missouri, Illinois to receive $19.8 million
in Affordable Care Act grants
St. Louis Business Journal by Greta Weiderman
U.S. Department of Health and Human Services Secretary Kathleen Sebeliustoday announced $10.3 million in grants awarded to community health centers in Missouri due to the new health care law, the Affordable Care Act. The money will go to support renovation and construction projects at the centers, which are located in Columbia, Kansas City, Kirksville and Springfield.
Missouri grantees estimate these awards will help them serve approximately 17,592 new patients.
Illinois community health centers estimate they'll be able to serve more than 17,700 new patients with the $9.5 million in grants to centers in the state, including a $500,000 grant to Southern Illinois Healthcare Foundation in Sauget, the only one in the St. Louis area to receive this round of funding.

Facebook Is Urging Members to Add Organ Donor Status
By MATT RICHTEL and KEVIN SACK - NYTimes.com
Nearly 7,000 people in the United States die each year while waiting for an organ transplant. It is a number that Facebook hopes to lower with its vast network of 161 million members in this country.
The company announced a plan on Tuesday morning to encourage everyone on Facebook to start advertising their donor status on their pages, along with their birth dates and schools — a move that it hopes will create peer pressure to nudge more people to add their names to the rolls of registered organ donors.
It is a rare foray by Facebook into social engineering from social networking, and one with a potentially profound effect, according to experts in the field of organ donation.

Georgia Girl Sues Classmates For Bullying Her On Facebook
ATLANTA (AP - CBSLocal.com) — When a Georgia middle school student reported to police and school officials that she had been bullied on Facebook, they told her there was not much they could do because the harassment occurred off campus.
So the 14-year-old girl, Alex Boston, is using a somewhat novel strategy to fight back: She's slapping her two classmates with a libel lawsuit.
As states consider or pass cyberbullying laws in reaction to high-profile cases around the country, attorneys and experts say many of the laws aren't strong enough, and lawsuits such as this one are bound to become more commonplace.

FDA may let patients buy drugs without prescriptions
Move would increase patients' out-of-pocket costs
By Paige Winfield Cunningham-The Washington Times
In a move that could help the government trim its burgeoning health care costs, the Food and Drug Administration may soon permit Americans to obtain some drugs used to treat conditions such as high blood pressure and diabetes without obtaining a prescription.
The FDA says over-the-counter distribution would let patients get drugs for many common conditions without the time and expense of visiting a doctor, but medical providers call the change medically unsound and note that it also may mean that insurance no longer will pay for the drugs.

New Obama slogan has long ties to Marxism, socialism
By Victor Morton - WashingtonTimes.com
The Obama campaign apparently didn't look backwards into history when selecting its new campaign slogan, "Forward" — a word with a long and rich association with European Marxism.
Many Communist and radical publications and entities throughout the 19th and 20th centuries had the name "Forward!" or its foreign cognates. Wikipedia has an entire section called "Forward (generic name of socialist publications)."
"The name Forward carries a special meaning in socialist political terminology. It has been frequently used as a name for socialist, communist and other left-wing newspapers and publications," the online encyclopedia explains.

Obama embraces Islam
If Islamism is OK for Egypt, why not America?
By THE WASHINGTON TIMES-Op/ED
The Obama administration is doing its utmost to promote the fortunes of the Islamist parties inEgypt. A State Department official declared that with the rise of these radical groups after the Arab Spring, "people who once might have gone into al Qaeda see an opportunity for a legitimate Islamism." They see this as a victory. The problem is, so do the terrorists.
Last year, the White House began peddling the line that the uprisings in the Middle East were a repudiation of the al Qaeda model of seeking change through terrorism. The argument was that while America opposed violent extremism, the rise of nonviolent radical movements was just fine, and even commendable. Al Qaeda leader Ayman al-Zawahri quickly dismissed this claim, saying that from the terrorists' point of view, it didn't matter whether an Islamist victory came through violence or not. The means were unimportant except as they related to the end state: the imposition of hard-line Shariah-based laws and policies.

Obama flies to Afghanistan, signs pact with Karzai
By Ben Feller - AP White House Correspondent - Boston.com
KABUL, Afghanistan—President Barack Obama slipped into Afghanistan Tuesday night on the anniversary of the killing of 9/11 mastermind Osama bin Laden and signed an agreement cementing U.S. commitment to the nation after American combat troops leave.
Alongside Afghan President Hamid Karzai, Obama declared, "Together, we're now committed to replacing war with peace."
The partnership spells out the U.S. relationship with Afghanistan beyond 2014, covering security, economics and governance. The deal is limited in scope and essentially gives both sides political cover: Afghanistan is guaranteed its sovereignty and promised it won't be abandoned, while the U.S. gets to end its combat mission in the long and unpopular war but keep a foothold in the country.

It's about your policies, Mr. Obama.

Glenn Hubbard:
Obama's Budget Means a Tax Increase on Everyone
[Google title for free article pass]
Maintaining the president's higher spending levels will require raising taxes for all Americans, including an 11% increase on those earning less than $200,000.
By GLENN HUBBARD - WSJ.com
The defeat in the Senate of the so-called "Buffett Rule"—that targets millionaires for a tax increase—marks one more step in the election-year discussion about raising taxes on higher-income individuals to close the nation's yawning budget gap.
Since 2008, a rising share of the economy—an estimated 24.3% of GDP in 2012, according to the Office of Management and Budget, up from 20.8% four years earlier—has been devoted to federal spending. The problem gets much worse. The Congressional Budget Office estimates that, absent changes in policy, the nation will spend 10 percentage points of GDP more on Social Security, Medicare, Medicaid and related programs in 2058 than it does today.

Soros Election-Rigging Project Dies?
By MATTHEW VADUM - The American Spectator.org
The mysterious disappearance of the Secretary of State Project.
Whatever happened to the left-wing Secretary of State Project liberals promised would save our elections from the dirty tricks of those dang lowdown, yellow-bellied, lily-livered Republicans?
The evidence now suggests that the election-stealing, George Soros-funded so-called "527" political committee is dead, or perhaps just deeply sedated. This group that section 527 of the U.S. Internal Revenue Code allows to accept unlimited financial contributions was created solely to rig elections for Democrats.

Rense & John Barbour - Soros will Count Ron Paul's Votes

May Day display: Hundreds of thousands rally worldwide
Moscow's streets are brimming with people this May Day - with most celebrating, and some demonstrating. Trade Unions marched under the Labour Day flag to demand better working conditions. And even Russia's ruling tandem took to spearheading a crowd of their supporters. RT's Irina Galushko was there.
Opposition members are also out to get their message across. Among them, the country's second-largest party, which still refuses to accept last year's parliamentary election results, and is unhappy about Vladimir Putin's return to The Kremlin. Jacob Greaves reports from amid a sea of red flags.
May the 1st is also being marked with mass Labour Day marches worldwide. In Europe - several large nationwide demos are underway.

* * * * *

The election could be more about Unions (i.e. preserving pension promises) than candidates... huge power struggle brewing.

Will Election 2012 Hinge on Union Busting?
By Steve Benen - WashingtonMonthly.com [May 10, 2011]
When GOP governors this winter began trying to bust public employee unions, a pillar of Democratic electoral strength, it seemed like a diabolically savvy political move, the kind Karl Rove used to call a "game changer." Yet in the weeks that followed, poll after poll showed voters siding with the unions over the governors. The Republican effort was particularly unpopular among groups like independents in Ohio who may well decide the 2012 elections.
Instead of backing down, the GOP has doubled down. Anti-union legislation has now spread to nearly half the states. With the primary season heating up, GOP presidential candidates will soon be under pressure to publicly side with the union busters — a stance that Barack Obama and other Democrats will surely remind voters of in the general election.

Wisconsin Vote Is First Shot in Wider Union War
Recall Election Tests Strategies for November
By JIM RUTENBERG and STEVEN GREENHOUSE - NYTimes.com
GREEN BAY, Wis. — "Recall Walker" bumper stickers dotted the workers' parking lot at the Georgia Pacific paper mill on Day Street here one recent afternoon, proof of their union's role in the effort to oust Gov. Scott Walker from office early for his legislation limiting public employees' bargaining rights.
But among the largest donors to Mr. Walker and his cause are the plant's owners, the billionaire industrialists Charles G. and David H. Koch, the latter of whom has said of the recall election to be held in June, "If the unions win the recall, there will be no stopping union power."
The recall vote here has been billed as a critical test of labor muscle versus corporate money. But it is only a warm-up for a confrontation that will play out during the presidential election, which both sides view as the biggest political showdown in at least 30 years between pro- and anti-union forces — a labor-management fight writ large.

What's Happening in Wisconsin Explained
By Andy Kroll with additional reporting
by Nick Baumann and Siddhartha Mahanta - MotherJones.com
The basics:
For more than a month, demonstrators have been pouring into the streets of Madison, Wisconsin—and the halls of the state's Capitol building—to protest rookie Republican Governor Scott Walker's anti-union "budget repair bill," which the governor signed on March 11. Big national unions, both major political parties, the Tea Party, and Andrew Breitbart have gotten involved. Democratic state senators fled the state in mid-February to prevent the legislature from voting on Walker's proposals, but returned in early March after Wisconsin Republicans rammed the bill through using a parliamentary end-run. And the protests have spread to other states, including Michigan and Ohio.
Is this like Egypt?
Not quite. Though there are some similarities.
What's actually being proposed?
Walker says his legislation, which would strip most state employees of any meaningful collective bargaining rights, is necessary to close the state's $137 million budget gap. There are a number of problems with that argument, though. The unions are not to blame for the deficit, and stripping unionized workers of their collective bargaining rights won't in and of itself save any money. Walker says he needs to strip the unions of their rights to close the gap. But public safety officers' unions, which have members who are more likely to support Republicans and who also tend to have the highest salaries and benefits, are exempted from the new rules. Meanwhile, a series of tax breaks and other goodies that Walker and the Republican legislature passed just after his inauguration dramatically increased the deficitthat Walker now says he's trying to close. And Wisconsin has closed a much larger budget gap in the past without scrapping worker organizing rights.
What's really going on, as Kevin Drum has explained, is pure partisan warfare: Walker is trying to de-fund the unions that form the backbone of the Democratic party. The unions and the Democrats are, of course, fighting back.

A Cynical Process
By THOMAS SOWELL - The American spectator.org
Labor unions have a lot in common with the United Nations.
Labor unions, like the United Nations, are all too often judged by what they are envisioned as being -- not by what they actually are or what they actually do.
Many people, who do not look beyond the vision or the rhetoric to the reality, still think of labor unions as protectors of working people from their employers. And union bosses still employ that kind of rhetoric. However, someone once said, "When I speak I put on a mask, but when I act I must take it off."
That mask has been coming off, more and more, especially during the Obama administration, and what is revealed underneath is very ugly, very cynical and very dangerous.

Rethinking the American Union
Mises Daily: by David Gordon
The contributors to Donald Livingston's valuable collection of essays defend two main contentions. Each of these contentions may be held independently of the other, but the first one provides a reason to welcome the truth of the second.
Livingston, with characteristic care, states the first of these contentions in this way:
As Aristotle taught, everything in nature has a proper size, beyond or below which it becomes dysfunctional.… The same holds for the functioning of other social entities [than a jury] such as committees, lawmaking assemblies, and bureaucracies and the ratio of population to representative (e.g., one representative for every million persons is not representation at all). None of these can function well if they are too large or out of scale.

Hunger Games Wisdom
President Obama has yet to understand
that the next president will be cleaning up his messes.
By ROSS KAMINSKY - The American spectator.org
Last weekend, Bill Clinton was the featured guest at two fundraisers which brought in a reported $2 million for President Obama's 2012 campaign.
As the Daily Caller put it, "Clinton gives Obama $2 million worth of faint praise."
Although the current president has substantially outraised Mitt Romney in the early part of the campaign season -- to be expected of an incumbent facing a field of hopefuls prior to the determination of the eventual challenger -- Obama's fundraising pace is down dramatically from 2008. Given Obama's rhetorical war against the "rich," the slowest economic recovery in modern American history, and an unpopular piece of "signature" legislation that has a real chance of being found unconstitutional, the downturn in his campaign contributions should not be a surprise. Remarkably, even the New York Times understands it.

NATO Summit 2012-Government
Planning to Evacuate Downtown
Chicago - Residents of a Chicago condo whose building will be in the eye of the NATO storm are being warned that they should move out for the weekend ... or risk being trapped inside by rioters.
FOX Chicago News was first to report Friday that the people living in the 17-floor Library Tower building at 520 South State Street were warned in a letter from condo management that "we are STRONGLY recommending that all residents find places to stay during the conference from May 18 through May 21."

Flashback gang could be making $10K a day off infected Macs
Symantec spells out the malware's
money-making mechanism: click fraud
By Gregg Keizer- Computerworld.com
Computerworld - The Flashback malware that's infected hundreds of thousands of Macs may be generating more than $10,000 a day for the hackers who made the Trojan horse, Symantec said Monday.
The malware steals clicks from ads that Google's search engine displays alongside search results.
In a blog entry posted today, Symantec published an analysis of Flashback's money-making capabilities, and concluded -- as others had earlier -- that the gang was turning a profit through click fraud.

Taxes and Employment
By BRUCE BARTLETT - Economix.Blog.NYTimes.com
Since the beginning of the economic crisis, Republicans have insisted that tax cuts and only tax cuts are the appropriate medicine. They almost never explain how, exactly, this would reduce unemployment other than to say it worked for Ronald Reagan in the 1980s.
If one were to take the Republican argument seriously, the linkage would have to be via the tax wedge. This is the principal means by which the government affects employment, according to the Republican economist Arthur Laffer. The tax wedge is the difference between the cost to an employer of employing a worker and the after-tax reward that the employee receives.

Renegade Economist with Ann Pettifor

Uncle Sam's nest egg... plunders your pocket.

Feds eye retirement-fund tax to cut $16 trillion-plus deficit
By GREGORY BRESIGER - NYPost.com
Uncle Sam, in a desperate attempt to fix its $16 trillion-plus deficit, is leering over Americans' retirement nest egg as its new bailout fund.
Capitol Hill politicians are assessing tax changes that could let the Internal Revenue Service lay claim to a portion of the $18 trillion sitting in 401(k) accounts and other tax breaks used by middle-class workers, including cutting the mortgage tax deduction.
A commission looking for ways to close the deficit, and, noting the extent of 401(k) tax breaks, recommends an examination of the system as one way to prevent government bankruptcy.

The above article is about the Gale proposal. Here's what William Gale (Sr. Fellow at Brookings Institute) had to say back in 2010:

Expanding Automatic Enrollment
and Making Saver's Credit a Match
Will Help to Improve Retirement Security
Retirement, Saving and Pensions, Opportunity and Well-being
William G. Gale, Senior Fellow, Economic Studies
David C. John, Deputy Director, Retirement Security Project
The Brookings Institution
SEPTEMBER 09, 2010 —
Recent recommendations by the President's Economic Recovery Advisory Board that would make the saver's credit a match to individual savings by moderate income workers and further increase the use of automatic enrollment in retirement savings plans are the latest indication that policymakers recognize the need to improve opportunities to save. However, while these recommendations are welcome news, additional steps are needed.
As it is currently structured, the savers' credit is an unkept promise for many families because it only helps those savers with enough taxable income to take advantage of the credit. Further, by acting only to increase tax refunds, the current version often acts more as an incentive to consume than it does to further save. The Board's recommendation to change it to a match of savings and be deposited directly into the taxpayer's account will help to increase that individual's savings balances. It will especially help younger workers who will find their accounts able to grow even more as the government matches earn additional tax free dividends and interest, thus greatly improving the size of the account at retirement.

If you are in DC, register for event on Thursday, May 3rd...
It's your future of taxation
The Hamilton Project
Economic Facts About Taxes: Rates, Revenues and Reform Options
Fiscal issues will rapidly come to the fore next fall as the federal government faces the looming expiration of the Bush-era tax cuts, the onset of the deficit "trigger," and another debate on the debt limit. Across the political spectrum, one of the few points on which today's policymakers can agree is that the tax code is in desperate need of reform.
On May 3, The Hamilton Project will host a policy forum on the economic context for tax reform and the economic criteria that should be used when evaluating tax reform options. As part of the event, the Project will release a new policy memo, "A Dozen Facts About Tax Reform," to help shed light on various aspects of the reform debate.

The Truth about Taxes: Just About Everybody pays Them
By Adam Looney and Michael greenstone - The Hamilton Project
Today's employment report showed continued growth in the labor market, although at a slower pace than over the previous four months. Furthermore, the unemployment rate ticked down from 8.3 percent to 8.2 percent in March. The economy has now produced positive jobs growth for the last eighteen months. Employer payrolls increased by 120,000 jobs in March, with manufacturing and health care posting large gains.
In past months, The Hamilton Project has examined employment trends over the last several years, as the Great Recession has taken its toll on many Americans across various segments of the population. This month, in honor of tax day, we explore how the current labor market has impacted one area affecting all Americans: taxes and, more specifically, who pays them. We also continue to explore the nation's "jobs gap."

Just How Progressive is the U.S. Tax Code?
By Adam Looney and Michael greenstone - The Hamilton Project
As tax time approaches, many are debating whether high-income taxpayers should pay more or whether their tax rates are already too high. This debate is particularly relevant today because of the economic struggles many Americans are experiencing, and because of the longer-term trend of rising inequality. A host of economic forces, like changes in technology, increases in international competition, and other changes in the labor market, such as the decline of unions and a falling real minimum wage, have reduced job opportunities and wages for some American workers, but expanded opportunities and incomes for others. In fact, the earnings and market incomes of many middle-class and lower-income households have stagnated and even declined over time, while incomes at the top of the income distribution have risen dramatically. The United States has traditionally boasted a progressive tax code—one in which the tax rate increases as income increases. A key question for policymakers, then, is how the tax system should respond to the current challenges—how progressive should the tax code be?

Gerald Celente: The Great Depression All Over Again

Charlotte to Suspend Constitutional Free Speech
and Assembly Protections
to Help Bank of America, Duke Shareholder Meetings
NakedCapitalism.com
It has become pretty routine for local police to engage in thuggery and run roughshod over Constitutional protections in the name of maintaining order, which increasingly means not annoying big companies.
With habeas corpus suspended, our own Attorney General maintaining the Administration has the right to kill suspected terrorists (ie, pretty much anyone) without a trial, and electronic surveillance ever on the rise, it might seem hard to get worked up about small minded suspensions of the right to make a political point in public of the sort planned in Charlotte, NC.

Duke Energy, Bank of America shareholders meetings
to fall under strict security rules
crafted for Democratic National Convention
Charlotte Business Journal by Susan Stabley, Staff Writer
When Charlotte City Council passed strict security rules in January for policing the Democratic National Convention, they said the new law would be used for "extraordinary events" drawing large crowds, such as Speed Street and the Fourth of July celebration in uptown.
Today, Charlotte City Manager Curt Waltondesignated those events as "extraordinary" and thus subject to the ordinance, plus two others — Thursday's Duke Energy annual shareholder meeting and the Bank of America annual shareholder meeting on May 9.
In past years, both shareholder meetings have been the target of protests from multiple organizations.
City Council approved the new rules to prevent violent protests, and to block camping overnight on city property. The 10-1 vote on January 23 effectively evicted members of Occupy Charlotte from sleeping in tents on the front lawn of Old City Hall.
Charlotte's new security rules may also affect uptown workers and residents who risk arrest if they inadvertently violate the new restrictions.

Class Warfare Is Being Used To Divide America -
And It Is Working
By Michael Snyder - TheEconomicCollapseBlog.com
At a time when America desperately needs to come together, we are becoming more divided than ever. The mainstream media and most of our politicians love to pit us against one another in dozens of different ways, and right now class warfare has become one of their favorite tools for getting us to hate one another. If you are struggling in this economy, you are being told that "the wealthy" are the cause of your problems. If you have money, you are being told that the poor hate you and want to tax you into oblivion. Class warfare has already become a dominant theme in the 2012 race for the White House, and there will certainly be endless speeches given along these lines by politicians from both major political parties all the way up to election day. Class warfare will be used by both sides as a way to divide America and get votes. And the frightening thing is that it is clearly working. There is more hatred between the poor and the wealthy in America today than at any other time that I can remember. But hating people because of how much money they have or don't have is not going to solve anything. Instead, it is just going to cause more problems.

Occupy Wall Street plans mass May Day demonstration
to shut down NYC
Protesters to target bridges, tunnels and finance biz buildings; Mayor Bloomberg vows quick police response
BY JOE KEMP AND REUVEN BLAU / NEW YORK DAILY NEWS
The NYPD is bracing for an attempt by Occupy Wall Street protesters to shut down traffic at arteries across the city during a mass demonstration Tuesday.
Using websites and pamphlets, OWS organizers are urging people to help block traffic at bridge and tunnel ports to slow people going to work on May Day.
Protesters — who also plan action in front of several financial buildings — are using the date to strengthen their numbers since the labor movement traditionally holds rallies that day.

Anarchy... running wild. Where is the Rule of Law?

12 MAY 2012 - GLOBAL REVOLUTION
From America to Asia, from Africa to Europe, people are rising up to claim their rights and demand a true democracy. Now it is time for all of us to join in a global non violent protest.
The ruling powers work for the benefit of just a few, ignoring the will of the vast majority and the human and environmental price we all have to pay. This intolerable situation must end.
United in one voice, we will let politicians, and the financial elites they serve, know it is up to us, the people, to decide our future.
We are not goods in the hands of politicians and bankers who do not represent us.
We will meet on the streets to initiate the global change we want. We will peacefully demonstrate, talk and organize until we make it happen.
It's time for us to unite. It's time for them to listen.
12 May 2012!

Mother Nature Mugs California's
Diablo Canyon Nuclear Power Plant
By John Daly - OilPrice.com
On 11 March 2011 TEPCO's Fukushima nuclear power plant was rattled by an offshore 9.0 on the Richter scale earthquake. The tremor subsequently generated a tsunami that effectively destroyed the complex, sending shock waves worldwide through the nuclear power industry, hoping that 24 years after Chernobyl, public amnesia and governmental commitments to curbing greenhouse gas emissions, nuclear power was moving back into the mainstream.
Instead of a nuclear renaissance, Fukushima refocused a most unwelcome spotlight on existing nuclear power plants (NPPS) and their safety procedures.
And in the U.S., of the nation's 104 commercials, the NPP most assiduously avoiding the spotlight is Pacific Gas & Electric's Diablo Canyon's NPP, 12 miles southwest of San Luis Obispo, where twin Westinghouse designed four-Loop pressurized 1,100 megawatt water reactors (PWRs) annually produce about 18,000 gigawatt hours for more than three million people.

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