The Obama administration has taken a whole series of steps towards a sane defense policy. This is diametrically opposed to a foolish and expensive policy that believes any defense action or spending is good, especially if it looks aggressive.
So now we’ve eliminated a few hundred billion of spending on missile defense shields that don’t work. There’s a reason we called ballistic missile defense “Star Wars” back in the 1980s: it’s never been more than science fiction. At least Newsweek is getting it right – it may look good on a TV news graphic, but that’s not the same as working in the Real World.
Continue reading What? A Sane Defense Policy?
Glenn Greenwald, a commentator in Salon, posted a scary observation in which he compares the U.S. economy to Russia and Argentina. He quotes Desmond Lachman, an IMF expert on emerging markets and former Salomon banker, who notes how we’ve seen the same thing in those emerging markets.
In an emerging market, a banking crisis like this looks like a liquidity crisis, and the government tries to shore things up with an injection of cash. In fact, it’s a solvency crisis. Outsiders like the IMF generally recommend to fix such things with transparency not with cash. Otherwise the local oligarchs will manipulate the crisis to get rich off the ‘recovery’ money. Meanwhile, the IMF and such require the government to reduce spending on social programs to pay for the enrichment of the fat cats.
Continue reading Scary Economic Observation