Is The US Russia?

Is the US Russia? The question seems provocative, if not outrageous. Yet the person asking it is Simon Johnson, former chief economist at the International Monetary Fund and a professor at the Sloan School of Management at the Massachusetts Institute of Technology. In an article in the May issue of the Atlantic Monthly, Prof Johnson compares the hold of the “financial oligarchy” over US policy with that of business elites in emerging countries. Do such comparisons make sense? The answer is Yes, but only up to a point.

“In its depth and suddenness,” argues Prof Johnson, “the US economic and financial crisis is shockingly reminiscent of moments we have recently seen in emerging markets.” The similarity is evident: large inflows of foreign capital; torrid credit growth; excessive leverage; bubbles in asset prices, particularly property; and, finally, asset-price collapses and financial catastrophe.

“But,” adds Prof Johnson, “there’s a deeper and more disturbing similarity: elite business interests – financiers, in the case of the US – played a central role in creating the crisis, making ever-larger gambles, with the implicit backing of the government, until the inevitable collapse.” Moreover, “the great wealth that the financial sector created and concentrated gave bankers enormous political weight.”

Now, argues Prof Johnson, the weight of the financial sector is preventing resolution of the crisis. Banks “do not want to recognise the full extent of their losses, because that would likely expose them as insolvent … This behaviour is corrosive: unhealthy banks either do not lend (hoarding money to shore up reserves) or they make desperate gambles on high-risk loans and investments that could pay off big, but probably won’t pay off at all. In either case, the economy suffers further, and, as it does, bank assets themselves continue to deteriorate – creating a highly destructive cycle.”

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HR 1388 National Service Program – Youth Will Not Be Allowed to Express Religious Beliefs?

HR 1388.  The House passed the Generations Invigorating Volunteerism and Education Act on Monday. The bill includes language indicating young people will be forced to participate in mandatory national service programs. The bill also states that “service learning” will be a mandatory part of the youth curriculum.

However what is really interesting about this bill is that the mandatory youth plan also forbids members from attending religious services and forbids youth from witnessing their religious beliefs. How this will be interpreted remains to be seen but here’s a copy of the bill so you can read it for yourself.

EC. 1304. PROHIBITED ACTIVITIES AND INELIGIBLE ORGANIZATIONS.

Section 125 (42 U.S.C. 12575) is amended to read as follows:

‘SEC. 125. PROHIBITED ACTIVITIES AND INELIGIBLE ORGANIZATIONS.

‘(a) Prohibited Activities- A participant in an approved national service position under this subtitle may not engage in the following activities:

‘(1) Attempting to influence legislation.

‘(2) Organizing or engaging in protests, petitions, boycotts, or strikes.

‘(3) Assisting, promoting, or deterring union organizing.

‘(4) Impairing existing contracts for services or collective bargaining agreements.

‘(5) Engaging in partisan political activities, or other activities designed to influence the outcome of an election to any public office.

‘(6) Participating in, or endorsing, events or activities that are likely to include advocacy for or against political parties, political platforms, political candidates, proposed legislation, or elected officials.

‘(7) Engaging in religious instruction, conducting worship services, providing instruction as part of a program that includes mandatory religious instruction or worship, constructing or operating facilities devoted to religious instruction or worship, maintaining facilities primarily or inherently devoted to religious instruction or worship, or engaging in any form of religious proselytization.

‘(8) Providing a direct benefit to–

‘(A) a business organized for profit;

‘(B) a labor organization;

‘(C) a partisan political organization;

‘(D) a nonprofit organization that fails to comply with the restrictions contained in section 501(c)(3) of the Internal Revenue Code of 1986 except that nothing in this section shall be construed to prevent participants from engaging in advocacy activities undertaken at their own initiative; and

‘(E) an organization engaged in the religious activities described in paragraph (7), unless Corporation assistance is not used to support those religious activities.

‘(9) Conducting a voter registration drive or using Corporation funds to conduct a voter registration drive.

‘(10) Such other activities as the Corporation may prohibit.

‘(b) Ineligible Organizations- No assistance provided under this subtitle may be provided to the following types of organizations (including the participation of a participant in an approved national service position under this subtitle in activities conducted by such organizations) or to organizations that are co-located on the same premises as the following organizations:

‘(1) Organizations that provide or promote abortion services, including referral for such services.

‘(2) For-profit organizations, political parties, labor organizations, or organizations engaged in political or legislative advocacy.

‘(3) Organizations that have been indicted for voter fraud.

‘(c) Nondisplacement of Employed Workers or Other Volunteers- A participant in an approved national service position under this subtitle may not perform any services or duties or engage in activities which–

‘(1) would otherwise be performed by an employed worker as part of his or her assigned duties as an employee or by another volunteer who is not a participant in an approved national service position; or

‘(2) will supplant the hiring of employed workers or work of such other volunteers.’.

Is The US Heading For A Depression?

This drop was led by a 22% drop in spending on durable goods like automobiles and washing machines.

The decline in motor vehicle production was so great that it alone contributed 2% to the fall in GDP.

Businesses hit

Businesses as well as consumers have been hit hard by the slowdown.

Exports, which had helped boost GDP earlier in the year, fell sharply, by 19.7%, as foreign markets for US products were hit by their own recessions.

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Bloody Monday: U.S. Cut 50,000 Jobs In One Day

From drugs to computer chips, top companies announced Monday that they are laying off nearly 50,000 employees as a reeling economy took a heavy toll on the already strained job market.

Monday’s efforts to downsize companies included layoffs and buyouts across the economic spectrum, and top economists predict that the job picture will worsen as the year goes on. The departures also come as negotiations continue in Washington, D.C., on the size and shape of an economic stimulus package — a priority for President Barack Obama, in office for barely a week.

Caterpillar, the world’s largest manufacturer of construction equipment, announced that its fourth-quarter profit dropped 32 percent, a symptom of the worldwide economic slowdown. Because of the drop, the company will eliminate 20,000 jobs, about 18 percent of its work force, through layoffs and buyouts, Caterpillar announced.

Drugmaker Pfizer, which announced it will acquire rival Wyeth for $68 billion, said it will cut about 8,000 jobs from its current work force. Once the companies are merged, another 15 percent of the work force, nearly 19,000 jobs, could be eliminated, Pfizer spokesman Ray Kerins said in a telephone interview.

Home Depot, the nation’s largest home-improvement retailer, announced it will cut about 2 percent of its work force, or 7,000 jobs. It said it will eliminate about four dozen stores, including all of its specialty Expo Design Center stores.

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Mysterious Fireball Lights Up Night Sky – Edmonton Canada

A mysterious fireball lit up the sky across Edmonton and a large part of the prairies Thursday evening. Many witnesses reported that they saw “bright orange flames” with a large tail that shot horizontally across the sky and then disappeared.

Others said it looked like horizontal lightning, where all the clouds in one huge swath were lit up.

Richard Bellington said he was driving north of Highway 2 on his way to Edmonton when he saw the sky light up.

The flames were so bright and appeared to travel so close to the ground that he called 911.

South Edmonton resident Peter Koroluk said it was hard to tell where it landed.

“It came down with a huge tail following and it had lit up past way behind it attached to the ball,” he said. “This ball was about the size of a football.”

Dan Charrois, who lives about 50 kilometres north of Edmonton, said security cameras set up at his home managed to capture some grainy footage showing a big flare in the night sky.

“It happened so fast I don’t think anyone would have had the reaction time to get it,” he told CTV.ca, adding that his computer software business has written programs which track meteors.

Though Charrois didn’t see the fireball himself, he decided to check the security tapes after his friends and neighbours called him to find out where the light may have came from.

“I only had to rewind a couple of minutes and it was there,” he said, noting the security time stamped the flash at 5:26 p.m. local time.

“You kind of see a flash, which lasts about two seconds or so,” he said.

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Swarms Of Locusts Spread Across Australia

Swarms of locusts are sweeping parts of Australia right now measuring about four miles long and 170 meters wide. Locusts feed mainly on vegetation and since this is the time for farmers to harvest their crops the government has about nine planes on standby to treat the swarms if they get any larger.

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