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Fairy dust

By Michael J. Smith on Tuesday August 5, 2008 03:10 PM

I've really come to depend on my lefty mailing lists. Here's a rather pleasing sequence from lbo-talk. The opening salvo:

Obama: I'd guarantee $4 billion to retool auto industry
A safety net for automakers picks up steam

[Obama] called for $4 billion in guaranteed loans and tax credits to help U.S. automakers retool for more fuel-efficient cars and to develop batteries for plug-in hybrids that get up to 150 m.p.g. The new breed of automobiles would fetch a $7,000 federal tax credit for buyers.

Doug Henwood, who has a good head for numbers, responds:
> Obama: I'd guarantee $4 billion to retool auto industry  

That's very nice of him, but GM has lost $47 billion over the last  
year; Ford, $12 billion. So $4 billion would cover about three and a  
half weeks of their losses.

Doug doesn't seem to have been as struck as I was at the notion that the taxpayers should pay people to buy new cars. But hey, you can't have everything. And the best is yet to come, from another contributor to the list:

This reminds me of something Louis Menand said in the NYRB in 1997 about Clinton (and Washington politics in general):


In a speech in San Francisco last month, President Clinton announced three new urban initiatives. First, the Department of Housing and Urban Development will offer a 50 percent discount to police officers who buy homes owned by the department in neighborhoods they patrol. The program is designed to reach one thousand police officers. It will last one year. The second is a reduction in the points on Federal Housing Administration mortgages, from 1.75 percent to 1.5 percent, for first-time home buyers in inner cities. This program is expected to save twenty thousand eligible buyers about $200 each in closing costs. The third initiative is a demonstration program that will allow up to two thousand families to use federal rent subsidy money to buy their own homes.

This is the style of governance that has been adopted by a country that has the strongest economy in the world, has enjoyed five years of sustained growth [1997, remember -- Ed.], confronts no immediate threat to its security, and has almost completely lost its faith in public works. This style is not neoliberalism or neoconservatism, whatever those terms mean. It is something different, a kind of Government Lite. We want to improve conditions in depressed urban areas, so we show our good intentions by sprinkling a handful of federal fairy dust over them.

The whole thing is well worth reading. Obama: Son Of Clinton!

Comments (23)


"sprinkling a handful of federal fairy dust "

recall that chestnut of neoglib patter
pub sec- pri sec

well make that lever long enough
and handfuls of fairy dust
could move ... the planet


Does this mean McCain was right again?!?! He said he wanted to help the economy by helping the auto industry just a few weeks back. I think Michael Dawson is onto something with this car business.

Michael Hureaux:

More socialized production for the rich paid for by the working poor. God bless Amurrika.

Well, ktm, corporate capitalism runs by six industrial complexes, plus government spending to boost and grease it all.

The complexes are:


Remove any one of the five or six legs, and the tables tips over.

The auto-industrial, however, is the one that is in big immediate trouble, due to the inherent pipe-dream of using two tons of materials to transport individuals to and fro every day of the year.

Finance will always renew itself, thanks to the basic structure of income distribution, and is also set up to expect some down times.

Medical ain't going nowhere.

Military ain't going nowhere.

Household (being food-clothing-shelter) certainly ain't going nowhere, and is, size-wise, largely a shadow of the automotive complex. The car gives you the suburb, which sells everybody washers and dryers to replace the shared laundromat room, etc.

The car is the linchpin of the system, and, hence, it is non-negotiable, from the overclass (read: mainstream + confused/cowed/captive "alternative") perspective.

P.S. re the numbers:

If you tote up vehicle purchases, repairs, fuel, insurance, parking, parts/tires, and road construction/maintenance, the yearly US expenditure on automobiles easily tops a trillion dollars. These days, it's probably >1.5 trillion...

So, the Neo-Gipper is talking about pumping in something like one-third-of-one-percent of the overall endeavor.

Such is the fruit yielded by the tree of Klintonism and its imported "balanced budget" rootstock.

And P.P.S.

Where the fuck is all the new electricity for these supposedly workable electric vehicles going to come from? Wind and solar are break-even propositions, at best, in EROEI terms, and using nukes or coal to make the juice would last about a decade before it would hit the self-same supply limits now looming for petroleum.

I know it's been said before, ala Chicken Little, but here we go again: Only a mass green-socialist-public enterprise uprising against the system will solve this coming crisis...


clarification on 40 bill loss at gm

"GM attributed most of the third-quarter loss to a $38.6 billion noncash charge related to accumulated deferred tax credits in the U.S., Canada and Germany. Accounting rules require companies to write down the value of such credits if they have scant prospects for a return to profitability in the near term."

paper loss
balance short sheeting

i'm a fan of smug doug's
and his up town take
on the trans nats

but sometimes the truth lies
beyond literacy energy
self confidence decency
and an adding machine

doug some times you need deeper models

in the broad spectrum
of corporate sidewalk overseers
mr henwood falls somewhere
between ...say
sterling newbury and bob avakian

plenty of lee way to slide in both directions

and even if unintentionaly
doug often done doed dat

an eclectic improv
makes for a bad martini

first step
replace your just any old
off the shelf
brand of vermouth

too wet doug too wet

nex time pass over the bottle
of journal-easy poli econ muddle juice

try adding some double distilled
oh i don't no
maybe .... stiglitz ???

i'm ready to send you some



i like the 6 complex bit nice

you may be slightly under counting
the relative size
of the helter shelter scam

but ain't you got
another kinda complex
yerseff ??

maybe a malthus complex ???

exhibit A

"...hit the self-same supply limits now looming for petroleum"

Malthus v. Prometheus

Now there's a title bout for ya!

But, truly, I fancy myself a Neo-Promethean. Just cross out where it says "machine-gun" and write in "pizza oven."

JK Galbraith called this one back in 1970...it's the age of quality over quantity, or else barbarism...

Nick Georgescu-Roegen (proud stoner Seth Rogen's grandpap?) fleshes (pun intended) that one out, too...


henwood the journalist:

"Klein’s use of a one-dimensional caricature of Friedman as an all-purpose whipping boy may play to the choir, but he deserves more serious attention than this. His economics was in many ways wrong and vile, but over the course of a fifty-year career, he helped reshape not only his discipline, but the way politicians and regular people think and talk about the economy. He was an extremely effective popular writer; if only the left could have produced a book as persuasive as Capitalism and Freedom, the world might be a better place. (Yes, yes, his argument was nicely aligned with the needs of capital in the 1970s, but on the other hand, capital also needed some degree of popular assent, which Friedman helped produce—and, on the third hand, polemic doesn’t count for nothing, and material interest isn’t everything.)"

champagne twitter
but patience
our game is about to brake cover ...

"One reason that Friedman became popular both within his own profession and in the larger world was that there were real economic problems in the 1970s. In the richer countries, Keynesian/welfare-state capitalism was in crisis because of stagflation. According to the economic consensus of the time, weak growth was supposed to mean low inflation—but weak growth coexisted with persistently high inflation throughout the 1970s."

this bit of giggle was identified
by keynesians (like a lerner) in the late 1940's

but here is the groaner
" Friedman offered an explanation for that: monetary stimulus beyond a certain point results in inflation, not additional growth. Growth was being held back by unions and regulations, which were interfering with the magic self-adjusting powers of the market."

that is a toal jumble of cost push with demand pull inflation
and now having bounced off both walls..

"The solution was tight money and deregulation. It worked, at least for a while, on its own terms, though at great human cost."

it worked ????
the volckerdammerung worked ???

then not to edterred from a nice swerve left

"but there’s a radical way of expressing the insights of Friedman and the others who came to power and influence in the late 1970s. Capitalism simply cannot live with low unemployment rates. Workers gain confidence, resist the direction of the boss, and wages are forced up. Add to that a welfare state, which cushions workers against the risk of job loss, and things are even worse from the bosses’ point of view. Their plight was evident in the depressed profit rates of the leisure-suit decade."

again the keynesians saw this in the 40's
hence the wage controls movement
the radical seer in question
the pole kalecki
had many orthodox fellow travellers
who understood the distinction
between a full employment macro policy
and a wage price spiral
credit fow validation dilemmas abound
but there's the mark up market solution
to the raw reserved amy gambit

where's the mention doug ???

and as to milty's cure all
steady but slow money flow ..
what if price wage profit dynamics require
a cycle anyway ????

enter the post reagan dawn
policy induced mild recessions

sum up

some stuff
like the kalecki nod
gets put right here
but as much or more goes wrong
its a groping a crude catch all
internally conflict and incoherent for x ray eyed model trained readers

the left's uncle milty atack
must be complete unconditional
and unrelenting
to the death

doug ain't got the know how for that
and apparently
thinks his balance is
a product of bias free brightness
not purblind shallowness


a pomo prometheus eh ??

contradiction in terms me thinks

we must prepare

the invasion of the big green machines
is near

brown is beautiful baby

punk it up
kill the frogs with only two eyes

kermit llc
is coming to the meme factory near you

blow it up brown

So "Fairy Dust" is the compressed version of the inevitable whinge from every liberal on the planet: Oh, but even if the Democrats are only one teensy-weensy itsy-bitsy poopie-doopie smidgeridoo better than the Republicans, it would be bad bad bad not to vote for them !!!

No wonder my antihistamines don't ever fucking work in the months leading up to Most Important Elections Ever [tm].


op, what do you think of Henwood's book Wall Street?

Who would you appoint, given the chance, as the mirror-left Friedman?

Prometheans and pomos are unable to interbreed, thankfully. In fact, pomos generally greatly prefer a phantastical simulacrum of masturbation to interpersonal engagements or even actual meat-beating...

Neo-Promies are admittedly kissin' cousins to old TR Malthus...

Family tree looks thus:

Pappy Promie: anything possible, technology is unlimited

Uncle Malthie: nothing possible, technology, energy, and humanity all doomed

Ourselves: almost anything possible, if Dad, who's got advanced dementia, doesn't blow up the world or burn off too much of its finite resources before we take the wheel and turn off onto E-Quality Lane...

Rough eyeball calc, from BEA:

US Avg Annual Real GDP (2000 base year) Growth:

1970-1979 = 3.3%
1980-1989 = 3.1%
1990-1999 = 3.1%
2000-2007 = 2.8%

What "worked" wasn't Milt F. It was redoubled capitalism/upward redistribution. That has nothing to do with "economics," at least not if you accept the cover story that "economics" is a science devoted to the common good, rather than a mere incantation atop the temple.

By definition, there can't be a left MF, as MF was a sponsored frontispiece, and our class hasn't ever come close to being powerful enough to throw up such reps.

My econo-fave remains Baran & Sweezy c. 1966.



mirror left for uncle milty ??
..in his generation
of academic economists

the obvious middle man is samuelson
but for the left i'll draft
bill vickrey

notice the huge "who he " gap here

"our class hasn't ever come close to being powerful enough to throw up such reps"

if i'm to find a prole view pointer
not just a left burger rad....

i agree with md
not much to pick from

most were more barber then surgeon

b and s included

then again the proles don't need
an economist of their very own....yet
only wild agit prop types
conjuring the old marxist brimstone
from the class cleft rock of ages


Henwood's book Wall Street

not bad ....for a beach read

old MF
dirty mf
takes away everything
he can get

always makin' sure that there's one thing left:

leave them
on the hook
with unsupportable deh-eh-eh-ebt


op, a beach read? I've made it to the part about options on futures and such and I find it hard going. Is one just gradually inured to this madness?


"Is one just gradually inured to this madness"

you gotta know when to fold em

how the arcane paper structures
actually work
is not often enlightening
what matters are
the motivations
behind the arcane paper structures
and how missing
the often un disclosed
at least ill disclosed singularity features
helps create the mirage of ceaseless profit

once the tricks are revealed ...

soros somewhere sez words to this effect
"every can't miss ' trading program'has flaw
or two
the forward churn of market reality
will eventually reveal...and punish
.....with a viciously retributive
sense of justice

plato's cave:

Helping the auto industry move toward fuel-efficient cars would be only one part of a broad federal program promoting alternative energy, first proposed a few years ago as an "Apollo Alliance" (mimicking the Moon-landing program of the 60's.) The numbers mentioned by the first writers of this proposal were $150 billion.

A number of that magnitude would require a corresponding decrease in some other federal program -- for example, the military budget -- which no politician today could even dream of proposing. Which is why Obama's initial teaser was so laughably low.

The Apollo Alliance has a website -- it's worth a look.

Plato, moving toward better cars is already happening. Why in the world should the public have to pay for that?

What we need is to build ourselves modern intra- and inter-city railroads, and make all public transit free.

As to the money, nobody batted an eye about running the Iraq Invasion via deficit financing, and that criminality doesn't come close to providing the macro-economic stimulus that building real railroads and funding free public transport would. Whatever deficits would be required up front would probably be gone withing a few years, as a sea of new job for workers added new paychecks and tax revenues.

Of course, none of this is going to happen. Corporate capitalism cannot survive without cars-first transportation in the USA.


"Apollo Alliance has a website -- it's worth a look."

No, it's not. "Green capitalism" is blowing green smoke up the collective bum. The Apollo Alliance are shills and fakers, sorry to burst your bubble there.

"What we need is to build ourselves modern intra- and inter-city railroads, and make all public transit free."

Yup...and notice how that's not on offer from EITHER candidate.

Do that (public transport), and just plain build *differently*. Get rid of zoning, allow Mixed-use, high-density, walkable communities...localize, localize, localize.

What's left of the US may get there eventually--after the crash, but there's going to be a lot of wailing and nashing of teeth as Suburban SUV America tries to go out with a Bang not a whimper. Too many people are still getting way too rich off the car-dependent suburban living arrangement.

As Real President Dick Cheney put it "The American Way of Life is Not Negotiable.", which is why the U.S. is in Iraq and Afghanistan, and may or may not be crazy enough to hit Iran.

Me, I walk to work, my comparatively cushy job in academe. I'm glad that I can, for now. But damn, the whole globalized transportation infrastructure is crumbling. Insane McCain might drive the economy over the cliff faster than Obama, but the American economy will eventually hit that Thelma and Louise moment even if Obama obeys the speed limit and all traffic laws on the way to the abyss. In either case, though, the stunt drivers have their golden parachutes ready for that moment, while the rest of us are tied up and only semi-conscious in the back seat.



maybe we all need to dial up the analytics
dial down the "i see what's comin... u geefs"

cassandra style triumphalism
looks bad ...
even on a marginalized face

it ain't that great to see
the run away future coming
right at us
to be yelling "watch out"
and not to be heard

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