Tuesday, February 9, 2010

Time for an American Intifada?

During the 1960 Christmas season, Americans flocked to the theaters to see Exodus, a 3-1/2 hour epic film featuring handsome freedom fighters and a riveting romance amidst the heroic triumph of Jewish Destiny over Arab Evil Doers. Set against a Yuletide backdrop of Biblical prophecy, moviegoers marveled as exiled Jews returned to their fabled promised land, a staple of popular culture to which Americans are first exposed as children in "Sunday school."

Many moviegoers failed to realize that Exodus was not fact but fiction. Even now, few Americans realize the storyline was adapted for the screen from a 1958 novel by Leon Uris. The biggest bestseller since Gone with the Wind-a novel set during the Civil War of the 1860s-the filmadaptation was directed by Hollywood icon Otto Preminger. The blockbuster's stars included a young Paul Newman with his leading lady a blond Eva Marie Saint.

The cast included character actor Lee J. Cobb and Peter Lawford, married to Pat Kennedy, a sister of John F. Kennedy who was elected president the same year. By then, Lawford was a famous member of pop culture's high profile "Rat Pack" that included singer Frank Sinatra, Dean Martin, Sammy Davis, Jr. and Joey Bishop. Italian crooner Sal Mineo, then a teen heartthrob, received an Academy Award nomination for his portrayal of a Jewish émigré.

An Oscar should have been awarded to Israel and its supporters for portraying this extremist enclave as a legitimate nation-state when, in reality, its founding traces to an alluring storyline. Forty-five years after the release of Exodus, American naiveté was again targeted by Jewish storytellers to induce the U.S. to war in the Middle East-only this time for real.

Then as now, Americans are easily swayed by sympathetic portrayals of an enclave granted nation-state recognition by President Harry Truman, a Christian-Zionist. The Missouri Democrat had famously read the Bible cover-to-cover five times by age 15. Truman was a True Believer in the same way that fundamentalist Christians believe-truly believe-that their Messiah will not return until the "Israelites" recover their ancestral home.

Preying on similar beliefs, Republican George W. Bush, another Christian-Zionist president, was induced with phony intelligence to wage war in Iraq. The false intelligence was traceable to Israelis, pro-Israelis or assets developed for that purpose. That invasion had long been a priority goal of those who believe-truly believe-in their right to an expansionist Greater Israel.

Yet as Shlomo Sand chronicles in The Invention of the Jewish People (2009), the historical evidence is scant either for an exile or an "exodus." As with the movie, the return of a "Jewish People" to a Jewish homeland is "a conscious ideological composition" meant "to claim a higher cultural lineage" than what can be supported by the facts.

In lieu of the novel-writing skills of Leon Uris, the Zionist narrative featured Biblical archeologists such as William F. Albright who, in the 1920s, traveled to the Holy Land to excavate artifacts that would, as Sand puts it: "reaffirm the Old Testament and thereby the New."

By interpreting his finds in Christian-Zionist terms, Albright and his colleagues not only unearthed Biblical "facts" that shaped the Sunday school curriculum, they also helped pre-stage the perceived legitimacy of a Jewish people returning from exile to a Jewish homeland. As Sand points out, if there was no exodus, how can there be a return? If there is no "Jewish People," how can there be a homeland?

Yet these widely held beliefs remain the premise underlying Israel's expansionist agenda and its rationale for heaping six decades of abuse on Palestinians who have lived there for centuries.

Political Expedience or Biblical Prophecy?

White House counsel Clark Clifford cautioned Truman that his reelection was unlikely absent the funding that Jewish-Americans-with Israel's recognition-were eager to provide. In early May 1948, General George C. Marshall, Truman's Secretary of State, argued vigorously against recognition. Strong objections were also heard from the diplomatic corps, the fledgling Central Intelligence Agency and the Pentagon's Joint Chiefs of Staff.

Marshall, the top-ranked U.S. military officer in WWII, was outraged that Clifford put domestic political expedience ahead of U.S. foreign policy interests. Marshall told Truman that he would vote against him if he extended sovereign status to an enclave of Zionist terrorists, religious fanatics and what Albert Einstein and Jewish philosopher Hannah Arendt called "Jewish fascists." Marshall insisted that State Department personnel never again speak to Clifford.

In March 1948, a Joint Chiefs paper titled "Force Requirements for Palestine" predicted the "Zionist strategy will seek to involve [the U.S.] in a continuously widening and deepening series of operations intended to secure maximum Jewish objectives." Those objectives included an expansionist agenda for Greater Israel that envisioned the taking of Arab land, ensuring armed clashes in which the U.S. was destined to become embroiled.

- Initial Jewish sovereignty over a portion of Palestine,
- Acceptance by the great powers of the right to unlimited immigration,
- The extension of Jewish sovereignty over all of Palestine,
- The expansion of "Eretz (Greater) Israel" into Transjordan and portions of Lebanon and Syria, and
- The establishment of Jewish military and economic hegemony over the entire Middle East.

Akin to the fictional portrayal in Exodus, those Zionists lobbying Truman assured him they would remain within the initial boundaries. We now know that was a lie. They also promised that the Zionist state would not become what it quickly became: a theocratic and racist enclave-albeit widely marketed by pro-Israeli media as the "only democracy in the Middle East."

To remove all doubt as to the extremist goals of the Zionist project, the Joint Chiefs assessment added ominously:

"All stages of this program are equally sacred to the fanatical concepts of the Jewish leaders. The program is openly admitted by some leaders, and has been privately admitted to United States officials by responsible leaders of the presently dominant Jewish group–the Jewish Agency."

Deceit from the Outset

A beguiling combination of Hollywood fiction, manipulated beliefs and outright lies remain at the core of this entangled alliance and the U.S.-Israeli "special relationship." The deceit deployed to advance the hegemonic goals of the Zionist project remains obscured by an undisclosed media bias reinforced by a widespread pro-Israeli influence in popular culture. As with the 1960 film, the ongoing manipulation of thought and emotion lies at the core of this duplicity a half-century later.

In The Persuasion Explosion (1985), author Art Stevens reports that Exodus was a public relations ploy launched by Edward Gottlieb who sought a novelist to improve Israel's image in the U.S. The name Uris originates with Yerushalmi, meaning "man of Jerusalem." The film rights to Exodus were sold in advance of the book's publication. Translated into dozens of languages, this masterpiece of mental and emotional manipulation quickly became a global phenomenon as its created favorable impressions of Israel.

The rewards are real for those who offer aid and comfort to this trans-generational deceit. When Truman's campaign train traversed the nation as part of a 1948 whistle-stop tour, grateful Jewish nationalists refueled his campaign coffers with a reported $400,000 in cash ($3.6 million in 2010 dollars). Those funds helped transform his anticipated loss into a victory with support from pro-Israeli editorial boards that-after recognition-boosted Truman's sagging popularity.

The Creation of Reliable Assets

Clark Clifford was rewarded with his career goal when he emerged as a top-paid Washington lawyer. After proving himself a pliable personality, he remained a reliable asset. During the G.H.W. Bush presidency, his combination of political prominence and perceived credibility provided cover for a massive bank fraud involving the Bank of Credit and Commerce International aided by Roger Altman, his Ashkenazi law partner.

In 2009, Hollywood released an action thriller (The International) starring Clive Owen and a similar storyline involving the International Bank of Business and Credit. Neither Clifford nor Altman had experience in banking when their law firm enabled what prosecutors charged was a global criminal operation.

Media reports described the BCCI scheme as the largest bank fraud in history. This $20 billion transnational operation even featured the requisite Hollywood component: Clifford's protégé was married to Lynda Carter, the star of Wonder Woman, a 1970s fantasy-adventure television series.

The real fantasy in this long-running geopolitical fraud lies in why U.S. lawmakers continue to befriend and defend a "nation" that has for so long-and so consistently-deceived and betrayed its most loyal ally. As a badly miscast Eva Marie Saint asked in her most memorable line in Exodus: "When will it ever end?"

The greatest wonder will be if, based on facts confirming the depth and duration of this duplicity, those lawmakers urging continued support for Israel are not charged with treason. [See: "How the Israel Lobby Took Control of U.S. Foreign Policy" http://criminalstate.com/2009/07/how-the-israel-lobby-took-control-of-us-foreign-policy/]

To restore its national security, the U.S. must shake off its entangled alliance with this extremist enclave. "Shaking off" is the literal translation of "intifada." Those who know the true facts behind this trans-generational deception are quickly reaching the conclusion that the recognition of this enclave as a legitimate state was key to this ongoing fraud. Others may be waiting for the movie, American Intifada.

The Indymac Slap in our Face

Click this link ...... http://www.thinkbigworksmall.com/mypage/player/tbws/23088/1111064

Britain, You Better Wake Up by Gilad Atzmon

The more I read about the Chilcot inquiry the more disturbed I am. The fallacy imbued in the heart of British ‘democracy’ is staggering. While some commentators are concerned with questions to do with the legality of the war, the most crucial issue here is actually the disappearance of ethical judgment from our public and political life. Rather than being concerned with morality and ethics British politicians are concerned with legalism. In other words, if someone would manage to prove that the war was ‘legal’ then the murdering of a million and a half Iraqis would be well justified. Let’s all face it, our politicians are corrupted to the bone.

In fact the Chilcot inquiry is in itself a pretty disturbing concept. As George Monbiot pointed out a few days ago in the Guardian CIF, in the world of British ‘official inquiries’, it is the government that appoints its members and sets its terms of reference. “It's the equivalent of a criminal suspect being allowed to choose what the charges should be, who should judge his case and who should sit on the jury”. As if this is not enough, none of the Inquiry members is an attorney. None of its member are qualified in the art of questioning. Consequently, the inquiry doesn’t have any legal ability, capacity or teeth. It is a farce. It is there to release some public steam. It is there to convey a false image of openness. I believe that the most pathetic statement was pronounced last week by Tony Blair, “People didn’t think that al-Qaeda and Iran would play the role that they did”, announced the unchallenged genocidal man in front of inquiry. Basically we are now blaming the so-called ‘enemy’ for not performing according to ‘our plans’. I guess that even an illiterate burglar would refrain from using such an argument in the court. Blair obviously got away with it.

But there is one positive side to it all, as sad as this Chilcot Inquiry seems to be, its team members are also revelatory. The panel is there to suggest who the government is inclined to appoint when it needs a whitewash.

On 22 November 2009, as the Chilcot inquiry was preparing to convene, former British ambassador, Sir Oliver Miles, expressed concerns over the fact that two out of the five members of the inquiry’s committee (40%), Martin Gilbert and Lawrence Freedman, were “strong supporters of Tony Blair and/or the Iraq war”. He also mentioned that both Gilbert and Freedman were Jewish, and that Gilbert is a devout Zionist”. 
Richard Ingrams wondered a week later in The Independent whether the Zionist links to the Iraq invasion would be brushed aside.

At the time Britain was taken to the Iraq war, the chief fund-raiser of its leading party was the devout Zionist Lord Levy who managed to collate a list of wealthy Zionists around him. The Inquiry should investigate closely the case of the Zionist Parliamentary lobby group namely the Labour Friends of Israel.

In the days leading up to the war, it was mentioned in the Guardian that the forged information about Iraqi WMD originated in an Israeli intelligence agency. It was later revealed that any references to Israel in Britain’s Iraq Weapons Dossier were hushed up. It is crucial that the Inquiry establishes whether this was indeed the case. If it was, it supports the contention that Britain was led into a war by serving a foreign country with foreign interests.

But as it seems, the unique amalgam of the inquiry panel, the lack of an attorney and the presence of two pro Blair, pro war enthusiasts, one of them a Zionist by admission, is there to stop the Inquiry from hitting the truth.

On 28 January 2010, BBC Radio 4’s “Today” program reported that Sir Martin Gilbert, had expressed “deep unease” at articles by Sir Oliver Miles and Richard Ingrams. 
Sir Gilbert gave an interview to the ‘Israeli Nationalist Radio’ a radio station run by Jewish settlers operating from an illegal settlement in the occupied territories.

Listen to BBC correspondent Tim Franks's report on the allegations of "anti-Semitism" made by Israel's voice on the Iraq Inquiry panel, Martin Gilbert – BBC Radio 4, 0739 GMT, 28 January 2010


In the interview with the settlers, Sir Gilbert offered false information about some obvious historical facts. He said for instance that ‘as far as he could see’, in 2003 Israel “regarded Iran (rather than Iraq) as its biggest threat”.

Every person who comments on the Iraq war is fully aware that Iran has become a leading regional super-power due to the military collapse of Iraq. It was the defeat of the Iraqi army and regime (2003) that promoted Iran to the premier enemy of the Jewish state. Two possible interpretations may be available to explain Sir Gilbert’s comment. He is either intellectually lame or disingenuous. Alternatively one may argue that Sir Gilbert is far from being stupid or insincere, he is just another Zionist spin master. As we all know the Labour party operates as a magnet for characters with spin-doctor qualities. Whether Gilbert is a spin doctor, a hypocrite, or a dimwit is not for me to decide. One thing is clear beyond doubt, the man must be removed from the Chilcot Inquiry immediately. We cannot allow a person who may be a charlatan or a spin doctor who certainly communicates with settler radio stations, to judge on our behalf what the true events were that led to the Iraq war, which he himself supported. Furthermore, we should also make sure that Sir Gilbert is removed from the national curriculum. I myself won’t allow my children to study WWII or Churchill from a textbook written by a Zionist war enthusiast who may also be either disingenuous or dull. If I ever see my kids looking into Gilbert’s texts, I will insist that they read it in a critical manner, so they know what the difference is between what Zionists want to tell us about our past, and what the past is.

But Sir Gilbert is just one symptom of a far deeper and concerning phenomenon. In recent years, Israel and its lobbies have managed to gain extensive control over British political life. Just a few months back UK Channel 4's Dispatches revealed that a “Pro-Israel lobby group is bankrolling the Tories. 50% of MPs in the shadow cabinet are Conservative Friends of Israel members”. One may wonder whether we still need an election in this country. At the end of the day, the vast majority of British political elite is practically bought by the Israeli lobby.

As we all know, for Zionist power to prevail a Sabbath Goy* is needed. A Goy that would support the Neocon wars, a Goy that would Vote “very strongly for the Iraq war”, a goy that would vote “very strongly against an investigation into the Iraq war”, a Goy that would fight anti Semitism, a Goy that would be corrupted enough to spin for the Zionist cause. Naturally such a person would be a shady character. He would also fail to resign once exposed.

In the following video you can watch Labour Friend of Israel MP Denis Macshane rushing to save Sir Gilbert.


As expected, Macshane repeats Gilbert’s embarrassing trick; he either pretends to be stupid or spins the Zionist mantra. “Religion” he quotes Thomas Jefferson, “should play no part in appointment to pubic office”. Macshane who wrote a book about anti-Semitism, must know that it is not Gilbert’s faith or even ethnicity that concerns a growing number of Brits. It is the Jewish national ideology i.e. Zionism, that alarms Sir Oliver Miles and the rest of us. It is this ideology that Sir Gilbert, a Zionist by admission, succumbs to and that should be enough to stop him from partaking in a British official inquiry into a Zionist war. In legal terms this is commonly referred to as a conflict of interests.

The clumsiness of Gordon Brown’s cabinet appointing such a farce of an official inquiry is mind blowing. It may also reveal the fact that the British political system is failing all the way through. It wasn’t just Blair and his acolytes. It continued with Brown and won’t stop with the coming Tory Government that as mentioned above, is largely bought by the same lobby.

Thinking about Karl Popper’s The Open Society And Its Enemies we are probably entitled to conclude that we are very far from being an ‘open society’. However at least we know who our enemies are. We may admit that for a few decades Israel and its supporters enjoyed a carte blanche in academia and politics, probably a lot to do with Western guilt. However, as Israeli crimes are exposed and Neocon intervention is realized, the patience towards Israel, its Zionist lobbies and its Sabbath Goys is running out. Britain, you better wake up before it is too late.

* Sabbath Goy- Originally, a non-Jew who does work on Sabbath that a Jew cannot do. In modern times, it is a non-Jew who toadies to the every wish and whim of the Jews, especially in politics, or a non-Jew who is heavily supportive of Israel.

Rash of retirements pushes Social Security to brink

WASHINGTON — Social Security's annual surplus nearly evaporated in 2009 for the first time in 25 years as the recession led hundreds of thousands of workers to retire or claim disability.

The impact of the recession is likely to hit the giant retirement system even harder this year and next. The Congressional Budget Office had projected it would operate in the red in 2010 and 2011, but a deeper economic slump could make those losses larger than anticipated.

"Things are a little bit worse than had been expected," says Stephen Goss, chief actuary for the Social Security Administration. "Clearly, we're going to be negative for a year or two."

Since 1984, Social Security has raked in more in payroll taxes than it has paid in benefits, accumulating a $2.5 trillion trust fund. But because the government uses the trust fund to pay for other programs, tax increases, spending cuts or new borrowing will be required to make up the difference between taxes collected and benefits owed.

Experts say the trend points to a more basic problem for Social Security: looming retirements by Baby Boomers will create annual losses beginning in 2016 or 2017.

"The moment of truth has arrived," says Rep. Paul Ryan, R-Wis., top Republican on the House Budget Committee. "This is a wake-up call."

JOBS AND THE ECONOMY: Rebound in 2010?

Social Security took in only $3 billion more in taxes last year than it paid out in benefits — a $60 billion decline from 2008, according to federal data. The slide in revenue occurred sooner than Social Security actuaries had expected, for three reasons:

• Payroll tax revenue that was growing at a 4.5% average annual clip along with wages flattened out in 2009 because of rising unemployment and pay raises that largely disappeared.

• The number of retired workers who began taking benefits increased by 20%; those taking disability jumped by 10%.

• Monthly benefits were raised 5.8% because of a spike in energy prices the year before.

Social Security was saved from bankruptcy in 1983 by a bipartisan deal that increased payroll taxes, taxed some benefits and gradually raised the retirement age to 67. That was supposed to keep the system solvent at least until 2058, but the projection has slipped to 2037.

The impact of the recession shows that "for all these projections, unexpected things happen," says Maya MacGuineas of the Committee for a Responsible Federal Budget.. "Money has to be found to repay those trust funds."

President George W. Bush proposed voluntary private retirement accounts in 2005, but the effort stalled in Congress. President Obama has proposed giving Social Security and other thorny fiscal issues to a bipartisan commission.

Freeway Ricky Ross on Alex Jones Tv: How The CIA Supply, Control, Operate The Drug Business

Ricky Donnell Ross (aka Freeway Ricky Ross), the convicted drug dealer who was featured in a Gary Webb expose on CIA involvement in the drug business.

Vacant stores are sign of times

WAILUKU - Maui's commercial real estate industry sure isn't as bad as on the Mainland, said veteran local leasing broker Ed Bello of Bello Realty Inc., who on a recent business trip to Colorado saw a bankrupt big-box store converted into a charter school and a former Blockbuster Video into a veterinary clinic.

If they had any tenants at all.

When he looks around at Maui's shopping centers, Bello said, rather than maybe one empty storefront, there may be four. Three more vacant spaces is a big shift for an island that just two years ago had a nearly 100 percent occupancy rate, he said.

The vacancy rate for retail, office and industrial space is estimated to have doubled to about 5 or 10 percent, depending on the type of retail center and the location, while the poor economy keeps typically free-spending tourists away, said Grant Howe, Commercial Properties of Maui LLC founder and managing general partner.

Look up to the second floor of those strip malls, and there are also more "For Lease" signs taped to the windows of empty offices than ever before, local Realtors and lease brokers said.

The two-year-old economic downturn has altered the commercial real estate landscape here for years to come, they said. Since commercial real estate typically trails residential sales and rentals (People always need a roof over their head, one expert explained.), it may be two more years before commercial space is again at a premium on Maui.

And it could be years more before expansions and new shopping centers planned long ago finally get built.

Developers interviewed last week repeated complaints about Maui County's notoriously difficult and drawn-out permitting process; and then they'd say it's probably that byzantine system that allowed a lot of landlords today to make their mortgages by not having to compete themselves into foreclosure in order to maintain or attract tenants.

"I don't think we need them," Bello said of the various new commercial projects awaiting green lights. "We would have been a lot more worse off if those had been built."

On the flip side, if entrepreneurs are looking to start a business on Maui today or an existing business wants to relocate, they will probably find some sweet deals on commercial rental space, the commercial property brokers said. Many, if not most, landlords are reportedly offering up to a few months of free rent, slashed rates and free improvements, according to the 2009 fourth-quarter report by CB Richard Ellis, Hawaii.

The experts also said that with some landlords who've paid off their property or when a shopping center is owned by a deep-pocketed corporation, they tend to be less flexible. The price per square foot, percentage of gross sales contribution or common area maintenance fee may be less, but the lease will probably be shorter, too.

No one wants to get stuck not getting fair market value for years if the economy suddenly comes roaring back, Howe said.

Bob Horcajo, owner of Kama'aina Properties, said they didn't give tenants whose leases were up a break on rent only because they asked for it. It's an investment for him as well, because a successful tenant is a long-term tenant, he said.

The experts said that available space is only in great abundance in pockets, like on Lahaina's Front Street, where even before the recession, nascent businesses were serfs to fickle tourists. During the recession, Front Street rents have sunk by as much as 30 percent, Howe said.

Hit extra hard these days are out-of-the-way shopping centers that never performed that well in the first place, the experts said. There's also added anxiety about a handful of retail centers that went ahead and opened in the midst of the downturn, with only a few tenants lined up, they said.

"Without enough money coming in, the big-picture question is: How many commercial (real estate) foreclosures will we have in the next year and a half?" said former Realtors Association of Maui President Bob Lightbourn. "We know it's coming, we just don't know whether Maui will be hit as hard the Mainland, although we don't think so."

The reasoning for these difficult economic conditions are simple enough to understand, Lightbourn said. By some estimates, tourism makes up 40 percent of Maui's economy. And Maui has seen a double-digit percentage drop in visitor arrivals.

It is a cycle, the experts said. Consumer spending drops. Businesses close. Jobs are lost. Rents and mortgages aren't paid, etc.

In particular, the Maui real estate pros said that restaurants - which is already a high-risk industry - are getting murdered these days.

One real estate broker asked: If you're not an established name like chefs Peter Merriman or David Paul, both of whom have new restaurants, who wants to open in today's environment? He noted that even award-winning Roy Yamaguchi's Kihei restaurant closed last year.

Bello and others said that Maui is in a unique situation when it comes to the commercial real estate market, in that there is a finite amount of space for development, which will eventually help landlords when the economy recovers. It is an island, Bello noted.

Some communities have only a few acres of undeveloped land zoned commercial, Bello said. Maui has become a relatively mature market, he said. The building boom days, with the exception of homes, appears to be over, he said.

Finally, mix in Maui County's unique "show me the water" ordinance, which requires new development to provide its own water source, and the upcoming Maui General Plan 2030 update, which will place boundaries on where new growth can occur, and the commercial real estate market should actually be pretty tight once the economy rebounds, the experts said.

Even those who have the hard-to-get county permits to build new retail centers have stalled or abandoned the projects as the development companies bleed cash, and banks are more reluctant than ever to lend.

For example, this week, major Maui real estate players Alexander & Baldwin Properties and the Lahaina Cannery Mall will ask the Maui Planning Commission to give them another two years before they have to move ahead on plans for the Kahului Town Center Project and a mall expansion, respectively.

County Council Member Mike Victorino said that, based on his conversations with developers, they are just taking a wait-and-see approach.

Most people who built at the economy's peak several years ago are suffering now, Bello said. However, Bello, who developed the South Maui Center, said he "lucked out" and has 95 percent capacity on retail. The second-floor office space, though, is not doing so hot, he said.

Other landlords reported similar vacancy issues, although they declined to discuss percentages.

Kahului's Queen Ka'ahumanu Center is the island's largest commercial space by far at 571,000 square feet. By comparison, the new Lahaina Gateway Center is 137,000 square feet.

"Yes, we have vacancies," said Queen Ka'ahumanu Center spokeswoman Lisa Paulson. "We are struggling in the economy, but a lot of our retailers are making adjustments, smart adjustments, in order to help their sales."

For example, she said, a women's clothing store noticed that customers wanted their dresses for $20 less than what they normally pay, so they just stocked up on items in that price range.

"With the stores and restaurants that closed, we were aware of their struggles ahead of time," she said. "Most of them just held on as long as they could after the holidays. We may also see some more corporate bankruptcies soon, too (of franchises)."

Bello said he believes that the commercial real estate rental market may have topped out. Landlords who were getting $3.50 per-square-foot are now in the $2.25 per square foot range. Maui's prices were probably too high, and this is a natural, healthy adjustment, he said.

"In this environment, everything becomes negotiable," said Realtor Rick Woodford of Peake/Lavoy Commercial Real Estate Services. "Personally, I think that there is a little more inventory than we're used to, but I still think this year we are going to be busy."

Peake & Lavoy's management and brokerage portfolio includes the Lahaina Gateway Center and new Wailea Gateway Center and Kukui Mall in Kihei.

Woodford said that the Maui Mall, which is owned and managed by Alexander & Baldwin Properties, should do well when the anxiously awaited Whole Foods Market opens Feb 24. The mall lost some tenants last year, so it has space for rent in what's almost guaranteed to be a very busy place, Woodford said.

He said the shopping centers near the resorts in South and West Maui tend to be more stable, with the exception of Front Street, which he called "its own environment." Wailuku and parts of Kahului are tougher markets, for the most part, Woodford said, noting that in Wailuku town a lot of the empty storefronts were vacant before the recession struck.

"But sooner or later, though, someone will come along with the right idea for a place and know what to do with it and make it work," Woodford said. "Retail is like that."

Bello said he's not as concerned about retail as he is about office space. While the T-shirt shops and delis will someday return, he doubts that IBM will be opening headquarters anytime soon in Maui, he said. In addition, a lot of small businesses have laid off workers and consolidated offices, or even work out of their homes to get by, he said.

A lot of people had to move on to new careers, he said, such as mortgage brokers and real estate agents.

"Obviously, times are not good," Bello said. "But on the Mainland, you might only see two stores open, and the rest of the shopping center is empty. We are not seeing that at all here. We're just used to seeing almost everything full. It's a concern, but it's not 'Oh, my God, the sky is falling.'

"As soon as tourism comes back, I think everything will be OK."

Ohio fiscal year tax revenue off by nearly $100M

COLUMBUS, Ohio — Ohio's tax coffers are nearly $100 million lighter than officials had expected by this point in the fiscal year, largely due to a January income tax shortfall.

Gov. Ted Strickland and his budget chief say one bad month does not make for a trend and note that tax collections were roughly on target for the first six months of the fiscal year, which began July 1.

Officials say total tax receipts for the seven months ending in January fell short of projections by 1.1 percent, or $99.6 million. According to preliminary numbers, last month's income tax collections missed the mark by 15.6 percent.

Budget Director Pari Sabety (SAH'-buh-dee) says it's not clear why income tax receipts were off by so much in January.


Copyright 2010, The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Bills aim to restore jobs in Film Office

Lingle administration says the cuts have not resulted in any losses for the state

The state Legislature is looking to add back jobs sliced from the state Department of Business, Economic Development and Tourism, including those lost when most of the state Film Office staff was let go.

A measure passed by the Senate Committee on Economic Development and Technology last week calls for restoring Film Office staffing to pre-cut levels, as well as those in DBEDT's Community Based Economic Development program and the Enterprise Zone/Partnership program.

The measure is one of several proposed at the Legislature in response to jobs lost last year as DBEDT Director Ted Liu looked for ways to meet budget cuts ordered by Gov. Linda Lingle. Four of the six positions in the Film Office fell to the budget knife, while several other programs within the department were also cut.

The Film Office staffing cuts produced the most criticism, with legislators and others expressing concerns that Liu had slashed jobs from a program that helped bring in high-profile projects that generated jobs. Liu assigned the tasks of the laid-off staffers to other department employees.

"These were programs areas that were contributing significantly to the economy," said Sen. Carol Fukunaga, D-11th (Makiki, Pāwa'a), who held hearings on the DBEDT cuts last year and has introduced a bill, SB 2144, to restore some of the staffing.

Fukunaga said the several hundred thousand dollars spent on the Film Office was worth the cost because of the amount of production work it helped generate.

"We continue to be concerned about the effect of the department's actions," Fukunaga said.

Fukunaga's bill and a companion House measure would set aside a dedicated budget for the Film Office from the state General Fund, along with designating a portion of the Community-Based Economic Development revolving fund to restore a manager's position. The Enterprise Zone/Partnership program's sole position would also be restored.

A House bill, HB 2844, proposes to restore Film Office funding through the creation of a special fund. Other bills would remove the Film Office from DBEDT's direct management oversight by attaching it to the Hawaii Tourism Authority.

Other bills would move the Small Business Regulatory Review Board to the state Department of Commerce and Consumer Affairs from DBEDT, while seeking to restore a position for a small business advocate.

The Hawaii Government Employees Association recently testified in favor of Fukunaga's bill. saying DBEDT's elimination of film office specialists who handled film permitting and other work will likely result in considerable lost income for the state. Much of the work has been transfered over to staff within DBEDT's Creative Industries Division.

The Lingle administration also has proposed changes. One of its bills calls for replacing the Hawai'i Television and Film Development Board with a Hawai'i Creative Media Commission. It would also expand and rename the Hawai'i Television and Film Development Special fund into the Creative Media Development Special Fund.

Liu said he doesn't see the value of transferring the Film Office to the Hawaii Tourism Authority and said the Film Office has not missed out on any opportunities that he is aware of. Georja Skinner, head of DBEDT's Creative Industries Division and the former head of Maui County's film office, is now performing the tasks previously handled by former Film Commissioner Donne Dawson.

Moreover, Liu said, Skinner and her staff have been able to close on film deals that were pending. The state recently announced that the fourth installment of Disney's "Pirates of the Caribbean" franchise would be shot in the state.

Several other pictures, including "The Descendants," and "Soul Surfer" are also being filmed here this year. Skinner recently told a legislative hearing that DBEDT supports the intent of the bill providing dedicated funding and that she was unaware of any film or television business that has been lost because of changes at the film office.

Recession chugs on, except in government

White House apologists were quick to point to the unemployment rate decline from 10 percent to 9.7 percent as evidence that the recovery is gathering momentum and that President Obama’s policies — especially his $787 billion economic stimulus bill Congress approved last February — are “working.” But the back story behind the figures provides cold comfort.

First, the drop to 9.7 percent unemployment does not reflect the creation of new jobs that normally accompanies an economic recovery. The number of new jobs is actually declining. Total nonfarm payroll employment, for example, dipped by an additional 20,000 positions after a December decline of 150,000 positions. The unemployment rate the day Obama took office last year stood at 7.6 percent and 134.6 million people had jobs. When he signed the economic stimulus, Obama promised the bill would bolster the economy sufficiently to keep unemployment below 8.0 percent. But the unemployment rate has exceeded 8.0 percent since last fall, and total employment stands at only 129.5 million. The stimulus has been a bust.

Second, anybody who thinks the job situation is going to improve dramatically in coming months is not paying attention to what’s going on behind the unemployment rate. The Hudson Institute’ Diana Furchtgott-Roth notes that “the labor force participation rate declined from 64.9% to 64.6%, the lowest since August 1985. This means that more and more Americans are dropping out of the labor force. Last month 661,000 Americans left the labor force.”

Further, adds Furchtgott-Roth, who was formerly the Department of Labor’s chief economist, “the percent of Americans unemployed for 27 weeks and longer rose from 38.7% to 39.8%. This is the highest since [the Bureau of Labor Statistics] started keeping records in 1948.” Worst of all, she said, “the number of jobs created in temporary help services, an indicator of future demand, actually fell from 55,000 to 46,000. So not only are workers not hiring permanent workers, they’re hiring fewer temporary workers too.”

Third, among the few sectors of the economy showing net employment growth over the past year is the federal government. The federal civil service is rapidly expanding as Obama increases the size of government, with 33,000 new positions being added in January alone. Only 9,000 of those new slots were for temporary census jobs. In other words, what we are seeing is good times for the public sector and the growing prospect of a continuing and perhaps even deepening recession for everybody else.

NRO's 9/11 'mock' plane crash set for 9:32am, drill included a smoke generator!

(9/11 researcher Matt Everett (aka 'Shoestring') wrote a great article near last Sept 11th anniversary that revealed some new details about the CIA & NRO's extremely suspicious and coincidental plane crash 'drill' planned for 9/11 that a lot of people might of missed.)

If it couldn't get any more coincidental than US spy agencies planning to have a mock plane crash into a govt building on -- of all days -- 9/11, their mock plane crash was to happen at 9:32am*, just 5min before the official time that the Pentagon would be hit (9:37am).

(*Note that the times between 0931:57 and 0932:32 were mis-typed. The time stated for the mock crash should be 0932:25, or 9:32am. See end of this blogpost for further explanation.)

But the huge coincidences about this "drill" keep coming.

Remember when after the Pentagon was hit, the main producer of smoke outside the building was caused by a diesel generator that just "happened" to be at the right place at the right time to catch fire. The foam trucks had to focus their firefighting efforts more on the burning generator than the point of impact from the alleged Boeing 757 crash.

Well guess what the CIA and NRO planned to have for their plane crash "exercise"?

That's right, a generator to emit smoke.

There's another huge coincidence about the scheduled mock plane crash of 9:32am. One of the two clocks that had fallen inside the Pentagon from the explosion had stopped at the same time.

Clock reads 9:32 am

(Did you notice that the exact times were only 6 seconds apart! -- 0932:25 vs. 0932:31)

Researcher Barbara Honneger thinks these same times of 9:32am are no coincidence and makes a good case that the Pentagon attack actually happened at 9:32am, not 9:37 as officials claim.

The full list of coincidences between the CIA/NRO's "drill" and the real Pentagon attack:
  • Both took place on 9/11
  • Both of their buildings struck by airplanes (officially)
  • Both planes took off from Dulles Airport
  • Both crashes happened at practically the same time (or exactly the same time)
  • Both will have generators emitting smoke at near/same time.
  • Both will have casualites and badly burned employees needing evacuation from their buildings
  • Both will have fire trucks and EMT vehicle attending
  • All parties (CIA, NRO, Pentagon, Dulles) are in the same metropolitan area

What are the odds that the everything planned in the NRO's plane-crash-into-building "drill" would take place in real life at the Pentagon on the very same day just 5min later (officially), or maybe even the same exact time (unofficially)?

Then factor in the odds that the same thing would happen again just a couple of years later in London on 7/7.

Don't forget that not only did one of the bombs go off in Tavistock Square of all places, but Rudy Giuliani and Benjamin Netanyahu were both in London nearby when the attacks occured.

There comes a point when coincidences cease being coincidences.

See also:

*After the military time of 0931:57, the next time has an additional digit added to it (09310:01). It's obvious a typo that was supposed to be 0932:01. The last two times of 0931:28 and 0932:32 were when the mock tower was trying to call the mock plane and it went down and I doubt a control tower would wait a whole 1 min 4 sec after its first attempt to contact a downed plane. Also see the list "Exercise Inputs." Numerous phone calls were to be made at 0932 (9:32am) to report fires throughout the NRO's building because the mock plane just crashed into it. So the mock crash time was actually scheduled for 0932:25, or 9:32am, 5 min before the official Pentagon attack time of 9:37am.

The US Economic Crisis: Jobs Continue to Vanish While the Media Applauds “Recovery”

At first glance it appeared there was a typo in the headlines. The national media reported that, in January, another 20,000 more jobs were lost. Somehow, the unemployment rate dropped, from 10 percent to 9.7 percent. Nobody thought this paradox was worth explaining; instead, the media’s attitude was “more good news” about the economy.

But there was other evidence of an obliterated job market hiding behind the cheerful headlines. After revising the employment numbers in 2009, The New York Times reported, “…the economy lost 150,000 jobs in December, far more than the 85,000 initially reported.” Overall in 2009, the adjusted numbers showed an additional “…1.36 million fewer jobs…” (February 5, 2010).

And yet the unemployment rate dropped. One reason this happened is that the U.S. government uses a separate, more unreliable survey to calculate the unemployment rate, in contrast to the survey used to calculate job losses. There are other more important ways the government obscures the unemployment numbers: if you are no longer receiving unemployment benefits you’re not counted as unemployed; if you’ve given up looking for a job, you’re not counted either. You are counted, however, if you are working only 15 hours a week, or if you're a temporary worker.

In this way the government cooks the books to bring fake optimism to the masses. The mainstream mediareports these fraudulent numbers without asking questions, so that the Democrats can continue doing absolutely nothing towards creating jobs.

But there is a method to the madness. Mass unemployment brings incredible pressure on workers’ wages and benefits. The mere threat of being unemployed puts unorganized workers in a precarious position when they’re told to work for less.

The organized labor movement is suffering from the recession too. In 2009 the number of workers belonging to unions fell by 771,000. Since union workers have higher standards of living, this number implies a further drop in wages and benefits overall.

These depressing numbers are cheered by corporations and politicians alike. To them, “economic recovery” means corporate recovery — an increase in profits, nothing more. And lower wages mean that profits are going to be even higher.

The shallow recovery that politicians are boasting about has been limited to some big businesses, especially Wall Street. Obama rejoiced at the recent news of 5.7 percent increase in GDP, even though this increase came at the expense of hundreds of thousands of jobs. The New York Times also added insight to how corporations are boosting profits:

“Instead of adding workers, many companies are squeezing their existing work forces to produce more. Productivity rose by a seasonally adjusted 6.2 percent in the fourth quarter…” (February 5, 2010).

To summarize: jobs continue to be cut by the thousands, while the remaining workers are forced to work harder with the same or often lower wages and benefits. This is the “new economy” that politicians speak of when they discuss “increasing exports” on the world market, a plan that requires that U.S. workers make lower wages to compete with the slave-wages overseas.

This is why the Democrats are doing nothing of substance to create living wage jobs. They tell lies about the job market recovering, creating false hopes by announcing skewed employment numbers to the public.

Such illusions can have only a temporary pacifying effect. Resentment is building up and optimistic speeches are wearing thin. But action is needed. Workers and the unemployed must unite to demand the creation of living wage jobs — a real jobs program that rebuilds America’s infrastructure and promotes education and social services. A good first step would be for union members to demand that all unions, from the very top to the bottom, organize the unorganized, and fight for the jobless by building a massive spring demonstration inWashington, DC, and on the West Coast for a massive jobs program.

White Cliffs of Dover to be sold to the French to help reduce Government's debt Read more: http://www.dailymail.co.uk/news/article-1249194/Dover-symb

For generations Dover has stood as an indomitable symbol of Britain’s freedom and independence.

The town, with its white cliffs, port and sprawling castle stood at the very edge of the nation’s frontier with the Continent.

But now part of that proud history is up for sale and the leading bidder is revealed as the former age-old enemy – France.

Spitfire over the White Cliffs of Dover

Heritage of defiance: A Spitfire over the White Cliffs of Dover

The Port of Dover is being recommended by Government advisers for sale to the French authorities.

It is one of a string of public assets which have been earmarked for privatisation as the Government battles with a record £830billion national debt.

The proposal for the port has prompted outrage.

Prospective Tory MP for Dover Charles Elphicke said: ‘It’s clear Gordon Brown has no sense of the history of our nation or the pride of our town.

‘How dare he consider selling it all off to the French? Dover is the English border. The people of Dover have a clear message for him – hands off our port, hands off the English border.’

A sale of the Port of Dover, Europe’s busiest ferry port, could net up to £350million for the Treasury. Its harbour board applied to the Transport Secretary for voluntary privatisation last month.

The sale is expected to be rubber-stamped and the leading bidder has emerged as Nord-pas-de-Calais regional council, which also owns Calais.


Broker: Gerry Grimstone, chairman of Standard Life, is advising the Government on the possible sale of Dover port

The French port is just 21 miles away across the Channel and the sale would mark a dramatic reversal in the fortunes of the two towns. Calais was captured by the English under Edward III in 1347, and the occupation lasted for more than two centuries.

The Port of Dover is the largest British port still in the public sector and made a profit of £15.1million in 2008.

It is a ‘trust port’, meaning all revenues are reinvested into it, and it is now seeking £400million to expand. Bosses anticipate a doubling in freight traffic by 2040.

Chief executive Bob Goldfield said: ‘The time is right for the voluntary privatisation of Dover. We want to invest around £400million on a second terminal and need to invest in the existing terminal, but are unable to because of public sector borrowing constraints. We want to throw off the shackles.’

Other major ports were sold off under the 1991 Ports Act, but Dover was retained because of uncertainty over how construction of the Channel Tunnel might affect it.

Gwyn Prosser, the town’s Labour MP, warned that jobs could be lost. The port’s workforce has shrunk by 60 per cent over the past eight years.

Mr Prosser said: ‘This is a strategic asset and we must be careful about the import of foreign capital.’

Port of Dover

For sale? The Port of Dover is the largest British port still in the public sector and made a profit of £15.1million in 2008

What Do Rising Sovereign Credit Default Swaps Mean?

Here are the CDS of Greece, Portugal, Spain and the U.S.:

[click here for full image]

Rolfe Winkler argues that - in the short-run - the PIIGS countries (Portugal, Ireland, Italy, Greece and Spain) will slash their budgets and get bailed out by the EU.

Simon Johnson thinks that the weakening Euro caused by the PIIGS' woes will hurt American exports (weaker Euro equals stronger dollar), and could lead to problems for leading global banks.

Other commentators fear that the PIIGS' crisis has as much potential as a financial "contagion" as the subprime meltdown and the failure of Lehman.

But for the long-term view, we need a little more perspective. One of the world's leading economic historians - Harvard professor Niall Ferguson - says:

The economists are ill qualified to analyse the current economic situation since they lack the overview of historians such as himself.

"There are economic professors in American universities who think they are masters of the universe, but they don't have any historical knowledge. I have never believed that markets are self correcting. No historian could."

Ferguson warns of huge government debts threatening the solvency of entire nations:

"The idea that countries don't go bust is a joke... The debt trap may be about to spring ... for countries that have created large stimulus packages in order to stimulate their economies."

But whether or not large nations actually go bankrupt, one thing is clear . . . Larry Summers, Ben Bernanke, Tim Geithner and their foreign counterparts have failed.

As I noted in December 2008:

BIS [the Bank of International Settlements - the "Central Banks' Central Bank] points out in a new report that the bank rescue packages have transferred significant risks onto government balance sheets, which is reflected in the corresponding widening of sovereign credit default swaps:

The scope and magnitude of the bank rescue packages also meant that significant risks had been transferred onto government balance sheets. This was particularly apparent in the market for CDS referencing sovereigns involved either in large individual bank rescues or in broad-based support packages for the financial sector, including the United States. While such CDS were thinly traded prior to the announced rescue packages, spreads widened suddenly on increased demand for credit protection, while corresponding financial sector spreads tightened.
In other words, by assuming huge portions of the risk from banks trading in toxic derivatives, and by spending trillions that they don't have, central banks have put their countries at risk from default.
Nothing has changed. As former chief Merrill Lynch economist David Rosenberg writes this week:

First the governments bail out the banks who were (are) basically insolvent. Then these governments, especially in Europe, see their balance sheets explode and face escalating concerns over sovereign default. The IMF now predicts that the government debt-to-GDP ratio in the G20 nations will explode to 118% by 2014 from pre-crisis levels of around 80%.

Now, the ball is put back onto the banks because many have exposure to the areas of Europe that are facing substantial fiscal problems right now. According to the Wall Street Journal, U.K. banks have $193 billion of exposure to Ireland. German banks have the same amount of exposure and an additional $240 billion to Spain. Many international bond mutual funds also have sizeable exposure to sovereign debt of Portugal, Ireland, Greece and Spain as well. Contagion risks are back. Stay defensive and expect to see heightened volatility.

In a nutshell, toxic assets have basically been swept under the rug in the hopes that we will outgrow the problem. Leverage ratios across every level of society are still reaching unprecedented levels as the public sector sacrifices the sanctity of its balance sheet in its quest to stabilize the dubious financial position of the household and banking sectors in many parts of the world.

Whatever bad assets have been resolved have almost entirely been placed on the books of governments and central banks, which now have their own particular set of risks, as we have witnessed very recently in places like Dubai, Mexico, and Greece, not to mention at the state and local government level in the United States. We simply have not seen a reduction in the percentage of properties with mortgages that are “under water”, hence the FDIC has identified 7% of banking sector assets ($850 billion) that are in “trouble”, so how can it possibly be that the financial system is anywhere close to some stable equilibrium?

When accurately measured, including the shadow inventory from bank foreclosures, there is still nearly two year’s worth of unsold housing inventory in the United States, and commercial vacancy rates are poised to reach unprecedented highs, and this excess supply is bound to unleash another round of price deflation and debt defaults this year. The balance sheets of governments are rapidly in decline across a broad continuum, and it is particularly questionable as to whether Europe is in sound enough financial shape to weather another banking-related storm.

The global economy is set to cool off. Not only is China and India warding off inflation with credit tightening measures but most of the fiscal and monetary stimulus thrust in the U.S.A. and Canada is behind us as well. And, the fiscal tourniquet is about to be applied in many parts of Europe, especially the PIIGS (referring to Portugal, Ireland, Italy, Greece and Spain — these countries account for a nontrivial 37% of Eurozone GDP). Greece’s GDP has already contracted by 3.0% YoY, as of Q4, and is expected to contract 1.1% in 2010 and 0.3% in 2011 as a 13% deficit-to-GDP ratio is sliced from 13% to 3% (assuming this fiscal goal can be achieved politically). Portugal has a 9.2% deficit-to-GDP ratio that is in need of repair and Spain has a deficit ratio that is even worse, at 11.4% of GDP.

The bottom line is that even if the fiscally-challenged countries of Europe do not end up defaulting, or leaving the Union, the reality is that they will have to take draconian measures to meet their financial obligations. Devaluation was the answer in the past in Greece but it cannot rely on that quick fix this time around without leaving EMU and if it did, then that could make it even harder to service its Euro-denominated debts — at least not without a restructuring. And, if Greece did attempt at a debt restructuring, rest assured that Italy, Spain, Portugal and Ireland would be next — we are talking about a combined $2 trillion of potential sovereign debt restructuring that would more than triple the $600 billion direct cost of the Lehman bankruptcy.

This poses a hurdle over global growth prospects at a time when Asia will feel the pinch from the credit-tightening moves in China and India. And heightened risk premia will also exert a dampening global dynamic of their own in terms of economic decision-making by businesses and households alike. The intense sovereign risk concerns are not limited to Europe either. In the U.S.A. we saw CDS spreads widen out to their highest levels since the equity markets were coming off their lows last April. According to the FT, the Markit iTrax SivX [sic] index of CDS on 15 western European sovereign credits rose above 100bps on Friday for the first time ever.

Deficits May Alter U.S. Politics and Global Power

WASHINGTON — In a federal budget filled with mind-boggling statistics, two numbers stand out as particularly stunning, for the way they may change American politics and American power.

The first is the projected deficit in the coming year, nearly 11 percent of the country’s entire economic output. That is not unprecedented: During the Civil War, World War I and World War II, the United States ran soaring deficits, but usually with the expectation that they would come back down once peace was restored and war spending abated.

But the second number, buried deeper in the budget’s projections, is the one that really commands attention: By President Obama’s own optimistic projections, American deficits will not return to what are widely considered sustainable levels over the next 10 years. In fact, in 2019 and 2020 — years after Mr. Obama has left the political scene, even if he serves two terms — they start rising again sharply, to more than 5 percent of gross domestic product. His budget draws a picture of a nation that like many American homeowners simply cannot get above water.

For Mr. Obama and his successors, the effect of those projections is clear: Unless miraculous growth, or miraculous political compromises, creates some unforeseen change over the next decade, there is virtually no room for new domestic initiatives for Mr. Obama or his successors. Beyond that lies the possibility that the United States could begin to suffer the same disease that has afflicted Japan over the past decade. As debt grew more rapidly than income, that country’s influence around the world eroded.

Or, as Mr. Obama’s chief economic adviser, Lawrence H. Summers, used to ask before he entered government a year ago, “How long can the world’s biggest borrower remain the world’s biggest power?”

The Chinese leadership, which is lending much of the money to finance the American government’s spending, and which asked pointed questions about Mr. Obama’s budget when members visited Washington last summer, says it thinks the long-term answer to Mr. Summers’s question is self-evident. The Europeans will also tell you that this is a big worry about the next decade.

Mr. Obama himself hinted at his own concern when he announced in early December that he planned to send 30,000 American troops to Afghanistan, but insisted that the United States could not afford to stay for long.

“Our prosperity provides a foundation for our power,” he told cadets at West Point. “It pays for our military. It underwrites our diplomacy. It taps the potential of our people, and allows investment in new industry.”

And then he explained why even a “war of necessity,” as he called Afghanistan last summer, could not last for long.

“That’s why our troop commitment in Afghanistan cannot be open-ended,” he said then, “because the nation that I’m most interested in building is our own.”

Mr. Obama’s budget deserves credit for its candor. It does not sugarcoat, at least excessively, the potential magnitude of the problem. President George W. Bush kept claiming, until near the end of his presidency, that he would leave office with a balanced budget. He never got close; in fact, the deficits soared in his last years.

Mr. Obama has published the 10-year numbers in part, it seems, to make the point that the political gridlock of the past few years, in which most Republicans refuse to talk about tax increases and Democrats refuse to talk about cutting entitlement programs, is unsustainable. His prescription is that the problem has to be made worse, with intense deficit spending to lower the unemployment rate, before the deficits can come down.

Mr. Summers, in an interview on Monday afternoon, said, “The budget recognizes the imperatives of job creation and growth in the short run, and takes significant measures to increase confidence in the medium term.”

He was referring to the freeze on domestic, non-national-security-related spending, the troubled effort to cut health care costs, and the decision to let expire Bush-era tax cuts for corporations and families earning more than $250,000.

But Mr. Summers said that “through the budget and fiscal commission, the president has sought to provide maximum room for making further adjustments as necessary before any kind of crisis arrives.”

Turning that thought into political action, however, has proved harder and harder for the Washington establishment. Republicans stayed largely silent about the debt during the Bush years. Democrats have described it as a necessary evil during the economic crisis that defined Mr. Obama’s first year. Interest in a long-term solution seems limited. Or, as Isabel V. Sawhill of the Brookings Institution put it Monday on MSNBC, “The problem here is not honesty, but political will.”

One source of that absence of will is that the political warnings are contradicted by the market signals. The Treasury has borrowed money to finance the government’s deficits at remarkably low rates, the strongest indicator that the markets believe they will be paid back on time and in full.

The absence of political will is also facilitated by the fact that, as Prof. James K. Galbraith of the University of Texas puts it, “Forecasts 10 years out have no credibility.”

He is right. In the early years of the Clinton administration, government projections indicated huge deficits — over the “sustainable” level of 3 percent — by 2000. But by then, Mr. Clinton was running a modest surplus of about $200 billion, a point Mr. Obama made Monday as he tried anew to remind the country that the moment was squandered when “the previous administration and previous Congresses created an expensive new drug program, passed massive tax cuts for the wealthy, and funded two wars without paying for any of it.”

But with this budget, Mr. Obama now owns this deficit. And as Mr. Galbraith pointed out, it is possible that the gloomy projections for 2020 are equally flawed.

Simply projecting that health care costs will rise unabated is dangerous business.

“Much may depend on whether we put in place the financial reforms that can rebuild a functional financial system,” Mr. Galbraith said, to finance growth in the private sector — the kind of growth that ultimately saved Mr. Clinton from his own deficit projections.

His greatest hope, Mr. Galbraith said, was Stein’s law, named for Herbert Stein, chairman of the Council of Economic Advisers under Presidents Richard M. Nixon and Gerald R. Ford.

America slides deeper into depression as Wall Street revels

December was the worst month for US unemployment since the Great Recession began.

People gather across the street from the New York Stock Exchange in New York Oct. 24, 1929. Thousands of investors lost their savings in the worst stock market crash in Wall Street history five days later.
History repeating itself? President Obama has been accused by some economists of making the same mistakes policymakers in the US made in the Great Depression, which followed the Wall Street crash of 1929, pictured Photo: AP

The labour force contracted by 661,000. This did not show up in the headline jobless rate because so many Americans dropped out of the system. The broad U6 category of unemployment rose to 17.3pc. That is the one that matters.

Wall Street rallied. Bulls hope that weak jobs data will postpone monetary tightening: a silver lining in every catastrophe, or perhaps a further exhibit of market infantilism.

The home foreclosure guillotine usually drops a year or so after people lose their job, and exhaust their savings. The local sheriff will escort them out of the door, often with some sympathy –– just like the police in 1932, mostly Irish Catholics who tithed 1pc of their pay for soup kitchens.

Realtytrac says defaults and repossessions have been running at over 300,000 a month since February. One million American families lost their homes in the fourth quarter. Moody's Economy.com expects another 2.4m homes to go this year. Taken together, this looks awfully like Steinbeck's Grapes of Wrath.

Judges are finding ways to block evictions. One magistrate in Minnesota halted a case calling the creditor "harsh, repugnant, shocking and repulsive". We are not far from a de facto moratorium in some areas.

This is how it ended between 1932 and 1934, when half the US states declared moratoria or "Farm Holidays". Such flexibility innoculated America's democracy against the appeal of Red Unions and Coughlin Fascists. The home siezures are occurring despite frantic efforts by the Obama administration to delay the process.

This policy is entirely justified given the scale of the social crisis. But it also masks the continued rot in the housing market, allows lenders to hide losses, and stores up an ever larger overhang of unsold properties. It takes heroic naivety to think the US housing market has turned the corner (apologies to Goldman Sachs, as always). The fuse has yet to detonate on the next mortgage bomb, $134bn (£83bn) of "option ARM" contracts due to reset violently upwards this year and next.

US house prices have eked out five months of gains on the Case-Shiller index, but momentum stalled in October in half the cities even before the latest surge of 40 basis points in mortgage rates. Karl Case (of the index) says prices may sink another 15pc. "If the 2008 and 2009 loans go bad, then we're back where we were before – in a nightmare."

David Rosenberg from Gluskin Sheff said it is remarkable how little traction has been achieved by zero rates and the greatest fiscal blitz of all time. The US economy grew at a 2.2pc rate in the third quarter (entirely due to Obama stimulus). This compares to an average of 7.3pc in the first quarter of every recovery since the Second World War.

Fed hawks are playing with fire by talking up about exit strategies, not for the first time. This is what they did in June 2008. We know what happened three months later. For the record, manufacturing capacity use at 67.2pc, and "auto-buying intentions" are the lowest ever.

The Fed's own Monetary Multiplier crashed to an all-time low of 0.809 in mid-December. Commercial paper has shrunk by $280bn ($175bn) in since October. Bank credit has been racing down a hair-raising black run since June. It has dropped from $10.844 trillion to $9.013 trillion since November 25. The MZM money supply is contracting at a 3pc annual rate. Broad M3 money is contracting at over 5pc.

Professor Tim Congdon from International Monetary Research said the Fed is baking deflation into the pie later this year, and perhaps a double-dip recession. Europe is even worse.

This has not stopped an army of commentators is trying to bounce the Fed into early rate rises. They accuse Ben Bernanke of repeating the error of 2004 when the Fed waited too long. Sometimes you just want to scream. In 2004 there was no housing collapse, unemployment was 5.5pc, banks were in rude good health, and the Fed Multiplier was 1.73.

How anybody can see imminent inflation in the dying embers of core PCE, just 0.1pc in November, is beyond me.

Mr Rosenberg is asked by clients why Wall Street does not seem to agree with his grim analysis.

His answer is that this is the same Mr Market that bought stocks in October 1987 when they were 25pc overvalued on Shiller "10-year normalized earnings basis" – exactly as they are today – and bought them at even more overvalued prices in 2007, long after the property crash had begun, Bear Stearns funds had imploded, and credit had its August heart attack. The stock market has become a lagging indicator. Tear up the textbooks.

State budget still in hole

SALEM — Voter approval of tax-­increasing Measures 66 and 67 appear not to have entirely solved Oregon state government’s budget woes.

Despite the tax increases and a slowly recovering economy, Oregon’s revenue collections are now expected to fall $183 million below previous expectations, according to the latest forecast issued Monday.

That’s a fraction of the $13.3 billion in general-fund spending planned for 2009-11 — but enough to put the budget $106 million out of whack, after accounting for the $77 million ending balance.

The news comes two weeks after voters approved the two tax-raising measures. The measures pull in a combined $733 million in higher personal income and business taxes. The Legislature enacted them last year to provide what turned out to be 5 percent of the current budget. Voter ratification of the increases does not put more money into state budgets, said House Revenue Committee Chairman Rep. Phil Barnhart, D-Eugene.

“It means we don’t have to cut budgets like crazy,” he said.

But the measures provided no guarantee that past predictions of revenues flowing into state coffers would remain unaltered. And the new revenue forecast proved that point.

State Economist Tom Potiowsky said the previous forecast in November assumed a quicker pace of Oregon’s economic recovery than what more recent indicators point to. At the same time, recent estimated income-tax payments have been lighter in the past few months than what was expected last fall. The payments come primarily from those at the top of the income ladder: business owners, investors and well-paid professionals who work with tax accountants.

Potiowsky said it’s possible that these peoples’ income is now low enough that their tax payments are lower than anticipated, or that they are holding onto cash right now and plan to make bigger tax payments in time for the April 15 deadline.

Barnhart said he’s hopeful that the Legislature can manage the newly emerged deficit without drastic changes in state spending. Most of the general fund pays for education, human services and public safety programs.

“We have to be really careful, but it looks like we can weather it,” the Eugene lawmaker said.

A bill moving through the Legislature would cut tax breaks to companies that spend money on renewable energy projects. That’s expected to net the state $55 million — nearly half the anticipated budget shortfall.

The rest would most likely be filled by drawing on state budgetary reserves, which total $318 million, and efforts to squeeze money out of existing budgets and agency funds, said Geoff Sugerman, a spokesman for the House speaker’s office.

One possible consequence of revamping the Business Energy Tax Credit is that corporate tax collections will jump higher for 2009-11 than what economists forecast when more generous tax breaks were put on the books at the close of the 2009 legislative session.

And that, in turn, could mean that the corporations will be in line for “kicker” refunds if actual collections of corporate taxes exceed the close-of-session forecast by 2 percent or more, which amounts to $16.6 million.

Gov. Ted Kulongoski is pressing the Legislature to refer a constitutional amendment to voters this year, calling for a portion of kicker rebates to go into a rainy-day fund instead of to taxpayers.

The state economist likened the Oregon economy’s upcoming stretch of recovery to a car motor idling after the battery-charging cables have been removed.

“The engine is still going to run,” Potiowsky said, but without as much power as when it was relying on juice from an external source.

For Oregon, the soon-to-be-removed added power takes two forms. One is $900 million in one-time federal economic stimulus money, most of which has gone to pay employees in education and human services and keep their programs running in 2009-11, but has not been renewed for the next two-year cycle, 2011-2013.

Another is from the private sector, in the form of corporate spending to restock dwindling inventories and for other long-postponed costs while waiting out the worst economic recessions in decades.

That kind of spending has become unavoidable, Potiowsky said, but it comes with no guarantee that the spending will continue or that an uptick in overall economic activity is looming.

“I would say Oregon is in recovery, but it’s going to be a slow, long road,” he said. “A little bit slower than expected.”

State General Fund revenue forecast

Economists have been gradually reducing revenue projections for 2009-11 since the Legislature wrote the budget last summer. Here’s what the last three forecasts have called for:

May 2009, forecast: $13.58 million

Nov. 2009, forecast: $13.39 million

Feb. 2010, forecast: $13.21 million