Stable Genius Liberal

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OK, something did happen to fiscal responsibility; but it happened circa 1981, not circa 1961. Who was the president then? (via Sixties Madness – NYTimes.com)

How LIBOR Impacts Financial Models and Why the Scandal Matters

Matt Taibbi asks why nobody is freaking out about the LIBOR scandal, Robert Reich calls it the scandal of all scandals, and Dylan Matthews has a great explainer of the whole thing here. Abigail Field has more at Reality Check.
This can be confusing stuff, so I want to go through a very simple example of how this impacts the markets.

The right isn’t talking about it because they haven’t figured out an angle to blame this on too much regulation or taxes being to high. Once they figure out a way to claim the scandal was caused by something they oppose, they will start talking about it. Until then, enjoy this really good explanation by Mike Konczal at Rortybomb.

“The people who are the engine of the economy.”

I’m not much of a car guy, but the way I understand this metaphor to work is that if you want to give rich people credit for being “the engine of the economy” then if the economy is performing subpar it follows that something’s wrong with your engine. And yet I suspect Zambrelli wouldn’t take kindly to that diagnosis.

If something good happens, praise me. If something bad happens, blame yourself. And if you disagree you’re a Marxist from Kenya.

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Moving to Canada to protest universal health care coverage is like moving to Saudi Arabia to protest the Ground Zero Mosque.

The truth about the Fast and Furious scandal

A Fortune investigation reveals that the ATF never intentionally allowed guns to fall into the hands of Mexican drug cartels. How the world came to believe just the opposite is a tale of rivalry, murder, and political bloodlust.

Worth a read. The ATF, while clearly not 100% in the clear here is not guilty of what the GOP is claiming.

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‘America’s violation of international human rights abets our enemies and alienates our friends.’ – Jimmy Carter Jimmy Carter: US Foreign Policy Since 9/11 Has Been ‘Catastrophic’ for Global Human Rights | Common Dreams

David Brooks Says That Mitt Romney and the Republicans Are Not Very Good at Arithmetic

Greece, Spain, and Italy have among the least developed welfare states in Europe. If someone wants to make an argument that there is some inherent problem with the welfare state model then we should look for crises in Sweden, Denmark and Germany, all states with far more generous welfare states than these Mediterranean countries. In fact, the welfare states of northern Europe are doing relatively well through the crisis, it is difficult to understand how anyone can look at the pattern of the crisis across Europe and conclude that it implies that the welfare state model has reached its end.

Dean Baker make a really good point that no one on the right will listen to. And most certainly not Mr. Brooks. But this is the kicker:

If the U.S. paid the same amount per person for health care as Denmark, Germany, or Sweden we would be looking at massive budget surpluses.

If you just look at the numbers, a better welfare state model would put us in a much better economic situation. Not that anyone on the right would consider such a thing.

Greg Mankiw’s Blog: I inspire a contest

That is very helpful. Thanks! I am always trying to find mistakes, omissions, and ambiguities in the book so I can improve the next edition. I look forward to seeing what they come up with.

Post-Keynesian MMT folks pick a fight with Mankiw and Mankiw thanks them. I’m calling round one for Mankiw.

Devaluation Is Austerity Done Right

Currency devaluation is best understood not as an alternative to austerity, but as the correct way for a debt-burdened society to implement austerity.

Why did Iceland recover and Ireland get worse? Iceland had a currency to debase. And they debased their currency enough to reset the economy and grow again. Three cheers for currency debasement. Ireland on the other hand, couldn’t debase the Euro. Like a nation on a gold standard, they had no way to make monetary policy changes to get the economy moving.

So if austerity works, shouldn’t it be the other way around? A stagnant Iceland and a booming Ireland?

House GOP Blocking Abortion Access for Raped Soldiers

if an Army medic serving in Afghanistan is raped and becomes pregnant, she can’t use her military health plan to pay for an abortion. If she does decide to get an abortion, she will have to pay for it with her own money. And if she can’t prove she was raped—which is difficult before an investigation is completed—she may have to look for services off base, which can be dangerous or impossible in many parts of the world.

Wow. This is just cruel.