Leah gave me a copy of James Galbraith's The Predator State, which contains the best description of the Social Security "debate" that I've seen. Pages 138 -139. It's long, but it's good, good, good:

The financial crisis argument rests on the large numbers of baby boomers set to start retiring -- on the fact that eventually payroll tax receipts will start to fall short of benefits due and that at some point in the middle distance, the bonds accumulated in the trust fund will have to be retired. Yet the reality is that this was the bargain established by the 1983 Greenspan Commmission. The baby boom was old news when this commission convened; it understood the demographics perfectly well, and nothing that has happened since has made the situation worse. On the contrary, the labor force has grown more rapidly in the years since 1983, thanks to higher levels of immigration than were foreseen and the recovery of productivity growth in the late 1990s, generating a larger economy from which projected benefits could be paid. If the Greenspan Commission, notwithstanding the reactionary deal it made, dealt effectively with the need to match tax receipts to the stream of benefits due, then the finances of the system are actually better today than they were expected to be back then. And therefore if the Greenspan Commission resolved the crisis, there can be no crisis now. And there is not.

Seen this way, efforts to cut benefits to the impending baby boom retirees are a way, simply put, of taking back the 1983 bargain. If they were enacted, the very same people who overpaid their payroll taxes to "prefinance" their Social Security benefits would find that they had been given a dishonest bargain. Having paid a lifetime of higher payroll taxes, subsidizing the income tax cuts enjoyed by the investor classes of the 1980s and 1990s, they would come to the end of the rainbow and find the pot of gold empty.

Except for their 410(k)s, of course. Not.

Somebody stop the bubble machine!

The New Yorker on Bernanke's debacle. There are many, many incidents that give one pause, but this one stands out for me:

The other event that changed Bernanke’s career occurred in the summer of 1999, at the height of the Internet stock boom, when he and Gertler were invited to present a paper at an annual policy conference organized by the Federal Reserve Bank of Kansas City. The topic of the conference—which takes place at a resort in Jackson Hole, Wyoming—was New Challenges for Monetary Policy. Then, as now, there was vigorous debate among economists about whether central banks should raise interest rates to counter speculative bubbles. By increasing the cost of borrowing, the Fed, at least in theory, can restrain speculative activity and prevent the prices of assets such as stocks and real estate from rising excessively.

Well, so much for finding a pony in there somewhere with Allie G:

Greenspan, who wrote in his memoir that “the Iraq War is largely about oil,” said in a Washington Post interview that while securing global oil supplies was “not the administration’s motive,” he had presented the White House before the 2003 invasion with the case for why removing the then-Iraqi leader was important for the global economy.

“I was not saying that that’s the administration’s motive,” Greenspan said in the interview conducted on Saturday. “I’m just saying that if somebody asked me, ’Are we fortunate in taking out Saddam?’ I would say it was essential.”

Let's hear it for the power of the human subconscious, which enabled Bush to invade a country without any awareness of his mission's main purpose!

It was essential to steal the oil from a sovereign nation. It wasn't, however, essential to make large and urgent investments in renewable energy. What good would it do us to develop a lucrative new industry, save the environment, and reduce our reliance on Middle East oil? None at all, you dirty hippie dumbass.

Thank God it was Greenspan protecting the long-term strength of the dollar:

When will the media stop using "Conservative" (and especially "fiscal conservative") to describe Republicans? At least Alan Greenspan has given up that old canard:

WASHINGTON - Former Federal Reserve Chairman Alan Greenspan, in his upcoming book, bashes President Bush for not responsibly handling the nation’s spending and racking up big budget deficits....

“My biggest frustration remained the president’s unwillingness to wield his veto against out-of-control spending,” Greenspan wrote.

On Monday, Mrs. Greenspan was full of shit as per usual when she said that most Americans wanted Scooter Libby pardoned. Actually 18% wanted him pardoned according to a CNN poll released that same day, but I guess that is just being a stickler for details.