The Bubbles Caused by High Taxation

Brian Domitrovic for Forbes discusses how capital went on strike in the 1970s because of a clutch of onerous tax increases starting in 1969, and was diverted instead to a bunch of "inert stuff" like gold, oil and land, causing unemployment to rise: 

The rich spent the 1970s trying to figure out how to hide their money. ...

The 1970s were the first heyday of “alternative investments.” Gold, oil, land, straddles, these exotica had been the preserve of a small group of specialists before 1969, when high earners got hit with a triple tax increase. The top capital gains rate got upped to an effective 49%, there was an income-tax surcharge, and the millionaire’s minimum tax (the AMT monster of today) began. This is not to mention “bracket creep,” whereby real tax rates go up with every increase in the price level. For the record, inflation was 200% from 1969 to 1982.

In this environment, the rich simply stopped what they were doing and focused all attention on preserving capital and avoiding confiscatory rates. ...

Read the whole thing here.

Housing Prices Still Need To Fall Much More

And they will.

TPC at Pragmatic Capitalism shows three charts here which demonstrate historically where we've been and where we are with respect to supply, demand and price.

From the peaks, demand for new homes is off nearly 80%, while prices of new homes are off only 25% and represent levels last seen in 2003.

Supply of existing housing is up over 70%, however. The current drop in supply to 10.5 months is seasonal but is still something like 160% higher than it was at the end of 2003. Clearing this inventory remains unemployment's doppelganger.

Unemployment Tab to Date is $319 Billion

The cost of unemployment benefits already paid over the last three years has soared to $319 billion, according to this story from CNNMoney.com, $109 billion of which has been federally funded borrowed, and $41 billion of which to date the states have had to borrow from the feds.

Employers face $26 billion in new taxes by 2015 to replenish and pay back the depleted and borrowed funds, which represents an increase of 68% from the $38 billion businesses paid in 2009.

Another reason jobs are in short supply.

Obama: The God That Failed

The Associated Press is reporting today here that unemployment holds high and steady at 9.6%:

Unemployment has now topped 9.5 percent for 14 months in a row, the longest stretch since the Great Depression of the 1930s.

Flash back to the beginning of the year when we were in month six of the fourteen:

"And the notion that I would somehow resist doing something that cost half as much but would produce twice as many jobs -- why would I resist that? I wouldn't. I mean, that's my point, is that -- I am not an ideologue. I'm not."

-- BHO, Baltimore Q and A, January 29, 2010

What else but devotion to a failed ideology would work like such a charm and keep unemployment so high for so long?

Obama The Lazy: No Intellectual Curiosity

Ulsterman for NewsFlavor.com claims to have the following from a White House insider, there from the beginning but recently out:


Obama the tireless, hard working candidate became a very tepid personality to us. And the few news stories that did come out against him were the only things he seemed to care about. He absolutely obsesses over Fox News. For being so successful, Barack Obama is incredibly thin-skinned. He takes everything very personally. ...

I’ll tell you this – if you want to see President Obama get excited about a conversation, turn it to sports.  That gets him interested. You start talking about Congress, or some policy, and he just kinda turns off.  It’s really very strange. I mean, we were all led to believe that this guy was some kind of intellectual giant, right? Ivy League and all that. Well, that is not what I saw. Barack Obama doesn’t have a whole lot of intellectual curiosity. When he is off script, he is what I call a real “slow talker”. Lots of ummms, and lots of time in between answers where you can almost see the little wheel in his head turning very slowly. I am not going to say the president is a dumb man, because he is not, but yeah, there was a definite let down when you actually hear him talking without the script. ...

Bill Clinton is a smart guy – he would run intellectual circles around Barack Obama. ...

When you take away the crowds, Obama gets noticeably smaller. He shrinks up inside of himself. He just doesn’t seem to have the confidence to do the job of President, and it’s getting worse and worse. Case in point – just a few days before I left, I saw first hand the President of the United States yelling at a member of his staff. He was yelling like a spoiled child. And then he pouted for several moments after. I wish I was kidding, or exaggerating, but I am not. The President of the United States threw a temper tantrum. The jobs reports are always setting him off, and he is getting increasingly conspiratorial over the unemployment numbers. ...

Obama is not up to the job of being president. He simply doesn’t seem to care about the work involved.  You want to know what? Obama is lazy. He really is. And it is getting worse and worse. Would another four years of Obama be the best thing for America? No it would not. What this country needs is a president who is focused on the job more than on themselves. Obama is not that individual. I actually hope he doesn’t run again. ...

Much more here.

Poverty Stats Worst Since 1960s

The Washington Post has the story:

The ranks of the working-age poor climbed to the highest level since the 1960s as the recession threw millions of people out of work last year, leaving one in seven Americans in poverty.

The overall poverty rate climbed to 14.3 percent, or 43.6 million people, the Census Bureau said Thursday in its annual report on the economic well-being of U.S. households. The report covers 2009, President Barack Obama's first year in office.

The poverty rate climbed from 13.2 percent, or 39.8 million people, in 2008.

According to the story, the rate of 14.3% would have been higher still had there not been an increase in Social Security and federal emergency unemployment outlays.

Read more here.

You'd Know It's a Depression If . . .

. . . 50 million Americans getting Medicaid, stopped getting it (cost $273 billion);

. . . 40 million Americans getting Food Stamps, stopped getting them (cost $70 billion);

. . . 10 million Americans on Unemployment, stopped getting it (cost $160 billion);

. . . 4 million on Welfare, stopped getting it (cost $22 billion).

The total current cost of these safety net programs: $525 billion.

Read all about it, here.

The Mother of All Bailouts

Bloomberg.com had an important article in June about the Government Sponsored Enterprises in which it is estimated that they may reasonably require taxpayer bailouts of $1 trillion in coming years:

Fannie, based in Washington, and Freddie in McLean, Virginia, own or guarantee 53 percent of the nation’s $10.7 trillion in residential mortgages, according to a June 10 Federal Reserve report. Millions of bad loans issued during the housing bubble remain on their books, and delinquencies continue to rise. How deep in the hole Fannie and Freddie go depends on unemployment, interest rates and other drivers of home prices, according to the companies and economists who study them.

Unlimited bailout authority for these failed government programs was granted in December 2009. That's what prepared the way for the idea behind the rumors now that underwater mortgage balances may be reduced by the Obama administration.

Read all about it, here.

As A Dog Returneth To His Vomit

Kimberley A. Strassel updated the Alexi Giannoulias affair in mid-July for The Wall Street Journal, highlighting the source of the Senate hopeful's personal fortunes, which ended up a bank failure in April:

Then in April federal regulators seized Broadway Bank. Records showed the bank's lending profile changed sharply after Mr. Giannoulias came on full-time in 2002. His lending department doubled down on the risky real estate loans that helped shred the housing market; Broadway piled up losses. Mr. Giannoulias prospered.

No doubt Mr. Obama can't wait to arrive on Aug. 5 to raise money for one of those, ahem, "fat cat bankers." And he'll be landing in Chicago just as the Blagojevich trial is raising uncomfortable questions about Mr. Obama's Chicago connections and his role pushing his friend Valerie Jarrett for the Senate seat. The state Democratic establishment is dutifully holding "Vote Alexi" signs, but many are bitter that the White House landed them with this guy. It won't be a pleasant visit.

Read the complete story, here.

GDP FOR Q1 2010 REVISED DOWN TO 3.0% FROM 3.2%

For the story, go here. An additional and final revision is still forthcoming.

Growth of 2.5% is necessary, according to widely reported statements by the Federal Reserve chairman and others, to maintain the status quo in employment and absorb the new workers who are added to the population every year.

In other words, there is no growth engine presently at work effectively providing jobs for 8.5 million people sidelined by the recession, not to mention millions more involuntarily part-timed by the downturn. 

32 STATES OWE FEDS NEARLY $38 BILLION FOR UNEMPLOYMENT BORROWING

The billion dollar hitters include twelve states:

California       6.9 billion

Florida            1.6 billion

Illinois            2.2 billion

Indiana           1.7 billion

Michigan        3.9 billion

New Jersey     1.7 billion

New York        3.2 billion

N.C.                  2.1 billion

Ohio                 2.3 billion

Penn.               3.0 billion

Texas                1.0 billion

Wisconsin       1.4 billion


The data were reported here.

Q1 2010 GDP Drops to 3.2% from Q4 2009's 5.7%

The following discussion of the initial report of first quarter GDP appeared here at HotAir.com:

Obama: Drop in GDP growth rate means we’re on the right track, or something

APRIL 30, 2010

ED MORRISSEY

Er, come again? The White House crowed endlessly about the 2009Q4 annualized GDP growth rate of 5.7% in January, even after most of it was shown to come from inventory adjustments. Now Barack Obama wants to treat today’s announcement of a 3.2% annualized GDP growth rate as a continuing improvement, when (a) it failed to meet analyst expectations of 3.5%, and (b) it’s a significant drop from the last report. Don’t worry, though, because as Obama explains . . . he has a different measure of progress:

The economy that was losing jobs a year ago is creating jobs today. After the single biggest economic crisis in our lifetimes, we’re heading in the right direction. We’re moving forward. Our economy is stronger — that economic heartbeat is growing stronger. But I measure progress by a different pulse.

Well, obviously. A 3.2% annualized GDP growth rate is better than the -6.0% of a year ago, but it’s still not a figure that will create the kind of economic expansion that will move large numbers of Americans from unemployment rolls to payrolls. Even the White House acknowledges that much in its own projections of unemployment. Despite Obama’s claims above, we still aren’t at a level of net job creation, and the continuing status of initial jobless claims in the mid-400K range means we’re not even getting close to break-even yet.

One last point . . . : Federal spending only rose 1.4% in 2010Q1, while state government spending dropped by 3.8%. The Porkulus money has all but stopped appearing in the economic measures. That makes the 3.2% a bit more solid than earlier measures, but it also means that Obama’s ability to artificially boost numbers before the midterms appears to be dissipating. The next quarters’ numbers will be quite interesting in terms of [their] affect on the national debate. If it’s still stuck at around 3% and unemployment continues to stagnate, Democrats will have trouble trying to use the spin Obama applied today.

Spread The Wealth Around: Abolish The Minimum Wage

Who wants to be a dog-kennel assistant, which is mostly a minimum wage pooper scooper making $8.55 per hour?

Apparently 260 jobless people do in Washington State, aged 14 to 60, including a graphic artist, a freelance photographer, two teachers, a financial controller, accountants, customer service reps, retail clerks and cashiers, waiters, laborers, construction workers, landscapers, and maintenance workers.

The story, reported here, says the unemployment rate at the lowest economic levels is running between 20 and 30 percent nationwide, which is a Depression-level statistic. People making over $100K, however, experience an unemployment rate far lower, it says, around 3 to 4 percent, and don't have a clue about what's really going on.

Has anyone thought of abolishing the minimum wage to spread the wealth around? There are countless jobs which people would do for less than $8.55 an hour if 260 overqualified people are competing for one job cleaning up after fido.

And while we're at it, let's abolish the Davis-Bacon Act of 1931 which requires government workers to be paid the prevailing wage. There are plenty of jobs in government which would get done much better for half as much in view of all the eager, qualified, unemployed people out there looking for work. And doing so would save the taxpayers billions.

Obama as Stalinist: The People Must Be In Error About Healthcare

It's all there if you really think about it, paler because it lacks a military face, but discernible nonetheless:

Obama's stated goal to transform the country rapidly;

the cult of personality which he has done nothing to discourage;

his enthusiasm for interfering with common liberties from fishing to private communications;

state-capitalism in the form of government ownership of industry;

enrichment of the unionized federal workforce at the expense of the unemployment-ravaged private sector;

and the co-opting of the radicals who supported him in the interest of promoting his own personal power.

All in all, an un-democratic man indeed, who flies under the cover of race.

And Jay Cost hopes "moderates" in the Democrat party can stop him? After what Obama did to a centrist like Representative Eric Massa (NY-29)? Moderation is hardly what is called for in a situation like this.

March 09, 2010

It's Time for Moderate House Democrats to Stand Up to Obama

Jay Cost

According to Gallup, Barack Obama entered the presidency with a net approval rating (i.e. percent approve minus percent disapprove) of 56%. This past weekend, he was at just +1%. No newly elected President has fallen so far so fast since polling began. Only Bill Clinton - in his difficult first year in office - came close.

Some pundits have an overly-reductionist take on Obama's fast-declining numbers, arguing that the precipitous drop is entirely due to the stagnant economy. They like to draw a comparison to Ronald Reagan, whose numbers fell quickly as he dealt with a recession early in his term. No doubt some of Obama's decline is related to the recession, but the 44th President - unlike the 40th - was elected when the economy was already contracting. This gives Obama political cover that Reagan did not have. Just 7% of Americans, according to a recent CBS News/New York Times poll, blame Obama for the recession.

If it's more than the economy, what else is it? Health care is a strong contender. Between Memorial Day and Labor Day of last year, Obama's net job approval rating in the RCP average declined by 63%. This was the period when House Democrats were beginning to divide openly over their reform proposals, and when the town hall protests started. As the debate has dragged on, his net approval has inched closer and closer to zero. Today, the country is essentially split in half over his tenure.

That split is not random. It breaks down along the typical cleavages. Obama is strong in the East; weak in the South. Young people like him; seniors do not. Democrats stand with him; Republicans and Independents don't. Blacks approve; whites do not. Single people support him; married people don't.

Yet the Democratic Party controls Congress today because in the last two election cycles it healed these divisions, at least partially. In 2008, House Democrats split the South. They won voters young and old. They won Independents. They held their own with whites. They split married voters. This is why they have a majority in the 110th House of Representatives.

If the current trends in public opinion continue, they will lose that majority because of President Obama's divisiveness. We have seen hints of things to come with GOP victories in Virginia, New Jersey, and most recently Massachusetts - as the difference-making voters for the Democrats in 2006 and 2008 turned to the Grand Old Party.

Either Mr. Obama and his advisors are blind to this, or they don't care, or both. I think it's both; call it willful blindness, a self-serving belief that 2008 was indeed a liberal realignment, and that the numbers will eventually reflect it. Regardless, House Democrats should know that the voters who have made them a majority party in recent cycles strongly oppose this health care bill; they have turned against President Obama; and they will eventually turn against them if they go along with the President. Moderates from the South and Midwest will be the first to go down to defeat as the party shrinks from a majority to a minority.

Yet such crassly selfish political considerations are not at the core of the debate moderate Democrats should be having. The real question is this: what is the Democratic Party all about? As I have argued before, the substance of this bill - with a mandate enforced by the Internal Revenue Service that all citizens buy a product from a private company as part of the terms of public citizenship - is antithetical to the historical spirit of the party.

But it's not just the substance. It's the process. The ever-obliging mainstream media have helpfully reduced the appropriateness of reconciliation to a merely legislative question, thus obscuring the bigger political reality: the Democrats must use reconciliation to pass health care because they no longer have a filibuster-proof majority; they no longer have a filibuster-proof majority in part because of health care. Their chosen strategy may pass muster with the Senate parliamentarian, but it suggests a blatant disregard for public opinion.

This is par for the course for the 44th President, who has made pretty clear his belief that, when he and the people disagree, the people must be in error. Democratic primary voters in small town Pennsylvania opposed him not because he was inexperienced, you see, but because their bitterness made them provincial. Now, Americans who don't support this bill simply don't understand it. They'll see things better after the Congress passes it.

Such arrogance makes for bad politics because it's un-democratic. Yet it's also un-Democratic. It's not unreasonable to expect the party of the people to respect the judgment of the people, especially on an issue that is so important and that has attracted so much attention. The public is as well informed about the health care debate as they ever are about anything. One would hope that the Democratic Party would acknowledge and respect this fact.

Progressives at liberal opinion journals and in the D.C. press corps have had trouble with this idea - and have ironically taken to employing fallacies of composition to suggest that public opposition is irrational. The people like the various elements of the bill, so the fact that they dislike the whole thing is a sign that they're not thinking clearly. If this argument was valid - if the whole was merely the sum of its parts - the Washington Redskins, an organization that likes to lure the best players from other teams rather than build from the ground up, would stand at the top of the National Football League.

The Democratic Party is broader than its progressive intellectuals and media cheerleaders. It has the majority not just because of San Francisco, California - but also Murfreesboro, Tennessee and Zanesville, Ohio. Those places voted Democratic in the 2008 House elections. Some progressives, especially in the blogosphere, see that as a problem - the "ConservaDems" they elect hold up true progress. But it's historically the greatest strength of the Democratic Party, whose appeal has long been much broader than the GOP's.

House Democrats should bear this in mind as they consider the current reforms. This bill would signal not just a major change in health care, but also in the Democratic Party itself. The end result will be a smaller, more narrowly liberal party that is less trusted by the mass public to respect its collective judgment. The party will keep San Francisco and The New Republic, but sooner or later they'll lose Murfreesboro and Zanesville.

Mr. Obama has indicated that he is all right with this. But in our system of separated powers, his opinion is insufficient. Ultimately, the decision rests with Southern and Midwestern House Democrats. They must make the final choice. They can vote with the President on a bill whose substance and process reflect little of the grandest traditions of the Democratic Party. Or they can stand up to him, and tell him that they have had enough of his condescending attitude and strong-arm tactics.

What moderate House Democrats should not do is assume that, if they vote with him on this one, President Obama will stop here. This President talked during the campaign about building a broad consensus for change. Yet when push comes to shove, he cares much more about change than consensus. He plans to tackle immigration reform, and there's no doubt he's still eyeing cap-and-trade. He has promised the Congressional Progressive Caucus that they can revisit health care later. If their constituents ultimately disapprove, moderate House Democrats shouldn't expect Barack Obama to give a damn. That's not his style. He likes to give lip service to consensus - but when you read the fine print, he inevitably defines any divergent viewpoints as out-of-bounds. He did it on the stimulus. He's doing it on health care. If moderate House Democrats don't stand up to him now, he'll do it on cap-and-trade, immigration reform, and who knows what else. Sooner or later, their constituents will elect representatives who will stand up to the President.

And those new representatives will probably be Republicans.

Of "Large Loans Between Vulnerable States" in Europe

A credit expert from Frankfurt is quoted painting a very grave picture of Euroland:

"Economically, we are in a very risky situation. Greece is close to default. We face systemic risk like the Lehman collapse and unless there is a bail-out for Greece, there will have to be a bail-out for the whole European banking system within two or three months," he said.

Yet they are damned if they don't, and damned if they do. "A Greek bail-out increases the risk of EMU break-up, because monetary union can only work if everybody sticks to the rules," Mr Felsenheimer said.

French banks have $76bn of exposure to Greece, the Swiss $64bn, and the Germans $43bn. But this understates cross-border links. There are large loans between vulnerable states. The exposure of Portuguese banks to Spain and Ireland equals 19pc of Portugal's GDP. Interlocking claims within the eurozone zone are complex. Contagion can spread fast.

To read more of this story by Ambrose Evans-Pritchard, go here.

And then consider this, from March 2009:

Contrary to public perception, the Wall Street Crash of 1929 was not the major catastrophe of the Great Depression; it was merely the precipitating event. In fact it was the bankruptcy of Credit-Anstalt in 1931 that made the Depression truly global, and crippled banks throughout Europe and North America. The resulting run on banks throughout the world, with numerous banking failures, was the catalyst that accelerated the rise in global unemployment.

The rest of that is available here.

The crisis which came to the fore in September of 2008 is not over, not by a long shot.

Nice Going, Governor Granholm: Michigan is Second Worst in the Western World!

(from econompicdata.blogspot.com)

The Pyramids of John Maynard Keynes

Caroline Baum notices that President Obama's fiscal 2011 budget contains money for everything, it seems, except pyramid building:

No longer will President Barack Obama be content to cite specious numbers about “jobs saved or created” as a result of last year’s $787 billion fiscal stimulus. Now he’s proposing $100 billion of new spending to “jumpstart job creation,” according to White House Budget Director Peter Orszag. It’s part of a $3.8 trillion budget for fiscal 2011, unveiled Monday, that projects a $1.3 trillion deficit next year, following a $1.6 trillion deficit this year.

Spend money to save money. Spending dressed up as a jump- starter is still spending by another name.

The only thing missing from the energy-cleansing, rural- community-assisting, climate-change-mitigating, health-food- promoting blueprint is money for pyramid building. In Chapter 10, Section VI of “The General Theory of Employment, Interest, and Money,” John Maynard Keynes advocated building pyramids as a cure for unemployment.

In fact, “Two pyramids, two masses for the dead, are twice as good as one,” he wrote in his 1936 treatise.

The reason Obama avoids mentioning pyramid building, however, has to do with the fact that Obama has political power, whereas Keynes did not have political power and did not therefore feel constrained.

"What's that?" you say. "What does that have to do with it?"

Because of what Aristotle said:

It is also advantageous for a tyranny that all those who are under it should be oppressed with poverty, that they may not be able to compose a guard; and that, being employed in procuring their daily bread, they may have no leisure to conspire against their tyrants. The Pyramids of Egypt are a proof of this, and the votive edifices of the Cyposelidse, and the temple of Jupiter Olympus, built by the Pisistratidae, and the works of Polycrates at Samos; for all these produced one end, the keeping the people poor.

Obama wouldn't want to put any strange ideas in anyone's mind, now, would he?

CPUSA Openly Aligns Itself With President Obama

President Obama, speaking to the House Republicans, on Friday, January 29, 2010, about the healthcare legislation debate:

"Now, you may not agree with Bob Dole and Howard Baker, and, certainly you don't agree with Tom Daschle on much, but that's not a radical bunch. But if you were to listen to the debate and, frankly, how some of you went after this bill, you'd think that this thing was some Bolshevik plot. No, I mean, that's how you guys -- (applause) -- that's how you guys presented it."

But the Bolsheviks aren't "plotting." They're openly applauding.

From The American Thinker:

July 20, 2009

Obama and the CPUSA

Randall Hoven

I encourage you to read the latest words from Sam Webb, National Chair of the Communist Party USA. As is the wont of communists, Mr. Webb is rather long-winded; I provide only a few interesting excerpts:

Six months into the Obama presidency, I would say without hesitation that the landscape, atmosphere, conversation, and agenda have strikingly changed compared to the previous eight years.

In this legislative session, we can envision winning a Medicare-like public option and then going further in the years ahead.

We can visualize passing tough regulatory reforms on the financial industry, which brought the economy to ruin.

In the current political climate, the expansion of union rights becomes a real possibility.

Much the same can be said about winning a second stimulus bill, and we sure need one, given the still-rising rate, and likely long term persistence, of unemployment.

Isn't it possible in the Obama era to create millions of green jobs in manufacturing and other sectors of the economy in tandem with an attack on global warming?

The new conditions of struggle are possible only - and I want to emphasize only - because we elected President Obama and a Congress with pronounced progressive and center currents.

Yes, socialism is our objective and, according to recent public opinion polls, it is increasingly attractive to the American people. But clearly it is not on the immediate political agenda.

As for our radicalism, we should be as radical as reality itself. And reality strongly suggests that our main task is to bring the weight of the working class and other democratic forces to bear on the reform process with the aim of deepening its anti-corporate content and direction.

Let's be aware that he [Obama] has to keep a coalition together for his long-term as well as immediate legislative agenda. Let's give President Obama some space to change and to respond to pressures from below.

The Right Wing, the American Medical Association, the pharmaceutical and insurance companies have drawn a line in the sand on health care.

The core of this struggle, whether we like it or not, turns on the inclusion of a public option in a health care bill.

Months ago it was said that the downturn could be "L-shaped" rather than "V-shaped." In other words, the crisis begins with a steep decline in economic activity followed by long period of economic stagnation.

I suspect that this is what will happen, thus making sustained government and people's intervention an imperative. In my view this should take at least three forms:

First, more economic stimulus: the economy is underperforming and nearly 30 million workers are unemployed or underemployed and that number hasn't peaked yet.

Second, restructuring is imperative. The old economic model that rested on bubble economics, cheap labor, financial manipulation and speculation, deregulation, capital outsourcing, environmental degradation, and so forth, has to be replaced by a new model that expands and restructures the productive base and is "people and nature" friendly.

Finally, the economy has to be democratized. The wizards of Wall Street and inside the Beltway failed miserably, in fact, so miserably those economic decisions that affect the welfare of millions shouldn't rest in their hands.

In the meantime, the struggle for immediate public sector jobs and relief should command our attention.

President Obama ... has expressed a readiness to engage with countries that during the Bush years were considered mortal enemies - Iran, Cuba, Venezuela, North Korea, and others.

In Iraq, the U.S. withdrawal plan is proceeding, with the first stage being withdrawal from Iraqi cities by July. President Obama has reiterated his intention to stick with the pullout deadlines. Even with the caveats about what U.S. forces might remain, this is a major victory for the peace movement.

If not already painfully obvious to you, let me point out a few things:

(1) Obama's policy agenda and that of the CPUSA are in perfect alignment: more stimuli; green jobs; global warming; public sector jobs; more regulation and, in fact, restructuring of the entire economy; eventual single-payer health care, with the public option being critical to any immediate plan; union-friendly legislation; cutting defense spending; engaging and normalizing relations with the US's mortal enemies like Hugo Chavez, the Castro brothers and the reigning mullahs of Iran; claiming victory in Iraq as their own.

(2) Obama's political approach is also in perfect harmony with that of the CPUSA's. The method is gradualism. Overall, Obama is doing pretty well at achieving CPUSA's goals under the current political circumstances. The Left should not expect immediate and radical changes. And of all things, the Left should not "define the current struggle as one that arrays the people against President Obama. That's not Marxism; it's plain stupid."

(3) Mr. Webb expects a lousy economy to continue. Specifically, he expects the "L-shaped" recovery. But this "long period of economic stagnation" will be an excuse for continued government intervention. As Lenin supposedly said, "the worse the better."

(4) Socialism is the objective.

In my view, this duck has a bill, webbed feet and feathers; quacks, walks, flies and swims; and has DNA that matches that of a duck. I'm willing to call it a duck.

The really striking thing about all this, though, is that the CPUSA can openly align itself with the President of the US, right under our noses, and it will have zero effect on public sentiment because the lapdog media studiously averts its gaze.

Depression Caliber Statistics

From Ambrose Evans-Pritchard at The UK Telegraph:

The broad U6 category of unemployment rose to 17.3pc. . . .

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. . . .

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. . . .

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. . . .

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) 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. . . .

To read the whole thing, go here.