Celebrating Thatcher’s death: Not good for your karma

There’s a big hullabaloo going on in Britain about Margaret Thatcher’s death and the subsequent celebrations in pockets around the nation.

In Glasgow’s George Square (where protest about Thatcher’s poll tax took place in 1989), hundreds of people gathered wearing hats, opened champagne, and launched streamers to mark her death. In Brixton, London (the scene of massive rioting in 1981) over 150 gathered for an impromptu street party after it was announced on Facebook. Bristol, Liverpool, Leeds and numerous other cities saw people handing out cake and chanting songs like “If you still hate Thatcher clap your hands!”:

The celebrations extended beyond Britain’s borders –  in South Africa, where resentment of Thatcher’s support of the Apartheid government still simmers, political figures expressed happiness at her passing. The Huff Post reported:

Pallo Jordan, a once-exiled ANC leader, was more direct. He told the Guardian: “Good riddance.”

“I’ve just sent a letter of congratulations,” Jordan said. “I say good riddance. She was a staunch supporter of the apartheid regime. She was part of the right wing alliance with Ronald Reagan that led to a lot of avoidable deaths.”

The joyous reactions to Thatcher’s death have been met with stern responses from her fans, and much of the political establishment.

Speaking on BBC Radio Ulster, former Prime Minister Tony Blair said that the celebrations of Baroness Thatcher’s death were not acceptable, saying, ”Even if you disagree with someone very strongly, you can still particularly at the moment of their passing, you should show some respect.”

Wrote Janet Daley in the conservative Telegraph:

Isn’t it about time we stopped devoting ridiculously disproportionate amounts of news coverage to the handful (and I do mean handful, in proportion to the national population) of youthful idiots and embittered misfits who are “celebrating” the death of the greatest peacetime British prime minister?

So what is the answer? Is it ok to celebrate someone’s death if you believe they caused you, your family or your country unnecessary pain?

I wrote about Thatcher’s tragic legacy yesterday, so don’t think it’s necessary to rehash the specifics. It is suffice to say that through her policies, Thatcher caused an immense amount of damage to large sectors of the British population (and of course abroad in places like South Africa). Britain is a fundamentally different place due to the radical measures she took to deregulate and privatize the economy, and as a result, it is almost irreversibly polarized and unequal. Miners lost their livelihoods, child poverty increased dramatically and workers rights were flushed down the toilet. Thatcher’s policies wrecked lives, and the anger is entirely understandable.

But to take to the streets, sing songs and break out champagne takes that anger to a completely new place, and it’s not somewhere I’d personally like to go.

I don’t wish to lecture anyone celebrating her death – my family wasn’t negatively affected by the Thatcher years (the opposite), so I can only try to empathize with those whose lives were ruined. I can only express my own feelings on the matter and hope that it may provoke some more nuanced debate on the topic.

There are some truly monstrous characters whose deaths are ultimately a good thing. I would personally pull the trigger on many brutal dictators throughout history – Adolf Hitler, Pol Pot, Josef Stalin, and so on. But these would not be joyous events, just a moral necessity to stop unnecessary carnage and human misery. When the US military took out Osama Bin Laden, it was I believe, ultimately a good thing. I was pleased a genocidal maniac was dead, but not over joyed. I couldn’t really get my head around the celebrations going on around the country – it seemed slightly sadistic and grotesque to be cheering for the pain caused to another human being, no matter how evil they were. If you’ve ever been around real violence or death, it isn’t pleasant, and only people with psychological problems want more of it.

I think it is justified in saying that Thatcher’s presence in British politics caused a lot more damage than good, and her departure from government was of huge benefit to the public. You can be pleased that she is no longer around to do any harm (she hasn’t actually done anything in 23 years), but to celebrate her death is to celebrate someone’s pain and suffering, and that can’t be a good thing.

Martin McGuinness Sinn Fein’s Deputy First Minister at the Northern Ireland Assembly, and long time Thatcher nemesis said it best, tweeting out: “Resist celebrating the death of Margaret Thatcher. She was not a peacemaker but it is a mistake to allow her death to poison our minds.”

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Mitt Romney and David Cameron: Failed Economics

The Conservative Party in Britain won the general election in 2010, inheriting one of the worst economies in recent history. New Labour under Tony Blair and Gordon Brown had failed to spot the inherent flaws in their economic platform and sat helpless as the financial sector collapsed in free fall in 2008. The Conservatives won the election based on Labour’s disastrous handling of the economy, successfully arguing that Labour had abused the public’s trust and could not be relied on to steer Britain back to economic prosperity.

In the US, the Democrats swept to power in 2008 after George Bush did much the same. Having presided over the economy for 8 years, the Republicans took full blame for the catastrophe on Wall St and John McCain felt the impact at the voting booths. The public bought into the Democrat’s argument for a better regulated, more equal society and Obama took office on the basis he would turn things around.

There is an obvious parallel between the two scenarios – in both countries, the party presiding over the economic meltdown in 2008 lost the subsequent election. But the differences were striking – the Conservative in Britain were not offering a platform of more regulation and more equality, instead they promised sweeping austerity measures and less regulation in order to get the economy back on track. In America, President Obama passed a multi billion dollar stimulus package and attempted to regulate Wall St, promising a dose of Keynesian measures to rebalance the economy.

The Conservatives achieved an astonishing feat in convincing the public that their ideology would work, and much of the credit should go to Margaret Thatcher who successfully shifted the country so far to the Right during the 1980′s that Labour had little choice but to follow to remain electorally relevant. New Labour under Tony Blair came to power in 1997 on a platform of conservative economics. They promised tax cuts, deregulation and a pro business culture that was completely alien to the party’s roots. Tony Blair and Gordon Brown went about turning London into the financial capital of the world, presiding over a decade of mass deregulation and transforming the city into a tax haven for the wealthy, and a flexible labor market for big business. The city turned Britain into an economic powerhouse while times were good. As financial whizz kids on both sides of the pond figured out new, complex trading techniques, buying and selling mortgage backed securities (while betting against their own investments at the same time), the country radically changed from an industrial based economy to a financial services based economy. Trading and increasing debt was the name of the game, and the banks were making a fortune out of it.

Simultaneously, Wall St was transforming America in much the same way, and it worked while everyone drank the Koolaid. But when reality set and the debt was called in, the economy collapsed like a deck of cards turning Wall St and the city of London into a parasitical entities rather than an engine of economic growth.

Gordon Brown, then prime minister quickly reverted back to traditional Labour/Keynesian economics and ordered the nationalization of several major banks and injected billions of pounds into the economy. He was widely credited with saving the banking system and pulling the economy back from the brink. Barack Obama passed the American Recovery and Reinvestment Act of 2009, allocating $831 billion of stimulus money over 10 years. The effects were as follows:

Writes Frank J. Lysy on the graph above:

The graph above shows the path of GDP growth in the UK and in the US by calendar quarters from the pre-recession peaks in GDP (set equal to 100).  This peak was in the fourth quarter of 2007 for the US, and in the first quarter of 2008 for the UK.  The downturn started in the US.  The UK economy then dropped further and faster, as the financial sector was at the center of the collapse and the financial sector (with London as the most important international center) is a larger share of the UK economy than it is in the larger and more diversified US economy.

The US economy began to recover soon after Obama was elected and was able to pass and start to implement the fiscal stimulus package (along with aggressive measures by the US Fed and other actions).  The UK economy also began to turn around at about the same time.  The Labor Party Government under Gordon Brown was following similar measures as were being implemented under Obama in the US.  Both economies then began to grow, at roughly similar rates.

But then the UK held the May 2010 elections, which the Labor Party lost.  The Conservatives (in coalition with the Liberal Democrats) took control of the Parliament and of the government.  David Cameron became Prime Minister.  He immediately announced that an aggressive austerity budget would be drawn up and implemented, and it was, starting in the summer of 2010.  This was the tenth quarter from the pre-recession peak for the UK of the first quarter of 2008.

The impact has been clear and stark, as shown in the diagram above.  The economy reached a peak in its recovery in the tenth quarter, but then the recovery stopped.

The numbers are clear: The stimulus worked in America and in Britain, then dropped off in the latter when austerity measures were passed by the new Conservative government.

The Tories managed to convince the British public that the same economic philosophy that caused the crash in the first place would work if implemented with even more severity. And in the US, Mitt Romney is trying to argue the same to the American public.

But in America, it doesn’t appear to be working despite Republican attempts to tie the poor state of the economy to Obama. There is no doubt that things are bad in America – the deficit is rising, unemployment is still above 8.1% and poverty is increasing. However, Americans are not buying into Romney’s argument that austerity and deregulation are the keys to turning it around. An article in the National Journal attempts to explain why:

Each passing day and each new poll brings further evidence that the Romney team has miscalculated. Obama has erased a once-formidable Romney lead on the question of who would handle the economy better as president; in some polls, the president has actually seized the advantage on that front. Economy-first independent voters are drifting Obama’s way. Voters increasingly say that the economy is on the right track…..

Voters appear to be prizing that (albeit slow) progress over the economy’s still-terrible levels of output and job growth. This attitude fits at least one historical pattern of American politics: University of Michigan economist Justin Wolfers studied more than 600 gubernatorial elections across recent American history—a much more robust sample size than presidential elections—and found that voters were much more likely to retain an incumbent when unemployment was falling, regardless of how high the rate was. It’s all about trajectory, no matter how slow or slight. Three years ago, the unemployment rate stood at 10 percent, meaning that it dropped almost 2 full points during Obama’s first term; those are the headlines voters remember, regardless of how the job data are interpreted.

As Jared Bernstein, the former top economist to Vice President Joe Biden, put it: “It makes a great deal of difference if you are sailing into a storm or sailing out of it.”

It finally looks like the public are catching on to actual facts despite the overwhelming propaganda coming from the Right, because there’s only so long you can sell an ideology that doesn’t work. In Britain, the Conservatives are in the process of making themselves unelectable for the next generation as the public has grown tired of cut after cut after cut with no results. In America, it looks like voters savvied up faster – they understood in 2008 that more Republican economics would hurt rather than help, and they understand again in 2012 that despite the slow progress, they are at least on the right track.

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Tony Blair and George W. Bush: Partners in crime (Photo credit: Wikipedia)

Tony Blair thought himself brave for facing down the dictator of a 5th rate military power with an economy as big as a mid sized British city. Blair spent years justifying the invasion of Iraq after it had happened, defining it as a moral decision dictated to him by God to stop the ‘forces of evil’ from threatening the world with a make believe Weapon of Mass Destruction. In reality, real bravery would have been standing up to the incompetent cowboy in the White House and his psychopathic Vice President, and refusing to commit British troops to a war that was clearly more about oil than freeing Iraqis.

In an interview to promote his memoirs, former UN secretary general Kofi Annan said he believed Tony Blair could have single handedly prevent war in Iraq had he challenged Bush and Cheney on their fabrication and manipulation of events leading up to the war. Via the Guardian:

“I will forever wonder what would have happened if, without a second [UN] resolution … Blair had said ‘George [Bush], this is where we part company. You’re on your own’,” he told the Times. “I really think it could have stopped the war … It would have given the Americans a pause. It would have given them a very serious pause to think it through … All this would have raised a question: ‘Do we go this alone?’”

While Annan argued that neither his resignation as UN secretary general or that of then US secretary of state, Colin Powell, would have changed the course of military action, Blair could have made a difference had he spoken out. “Because of the special relationship and also the fact that … when you think of the big countries, Britain was the only one that teamed up with [Bush],” Annan said.

Instead, Blair became cheerleader in chief for America’s war in Iraq, doing the incredibly easy thing in saddling up to the world’s greatest super power. It never occurred to Blair that refusing to take part in the illegal invasion of a sovereign nation would have been viewed as the far braver thing to have done, but then the term ‘politician’ is not exactly synonymous with ‘courage’.

Annan’s scathing assessment of Blair’s role in the lead up to war further compounds the historic view that not only was he complicit in the catastrophic endeavor, he was pivotal in making it happen. Without Britain to back them up, it would have been unlikely for America to go it alone in Iraq, despite Bush’s rhetoric. The political consequences probably would have been to great at the time, and diplomacy may have been able to prevail.

Sadly, we’ll never know.

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Julius Ceaser crossing the Rubicon

By Ben Cohen: There’s a debate swirling around the blogosphere between progressives and the hard Left in regards to Obama’s civil liberties and foreign policy record, specifically his signing of the NDAA, the continuation of Guantanamo, the use of drones and the assassination of Anwar al-Awlaki, a US born al-Qaeda terrorist. John Cusack put up an interview he conducted with George Washington University constitutional law professor Jonathan Turley on the issue, and referred to Obama’s abuses as ‘Crossing the Rubicon’, a reference to Julius Ceaser’s crossing of the Rubicon river that marked the boundary between the Roman province of Cisalpine Gaul to the north-east and Italy. Caeser’s foray across the river  in 49BC was seen as an act of insurrection and the idiom has remained to this day in reference to ‘an act that goes too far’. Both Cusack and Turley agree that Obama’s constitutional abuses are unforgivable sins and make him unworthy of their vote this election.

While not rescinding his vote this year, prominent Obama supporter Andrew Sullivan has been equally scathing of the President in this regard. He writes:

It’s a disgusting sign of the collapse of the rule of law among Washington’s elites – pioneered by the Obama Justice Department. War crimes are forgiven; leaks revealing war crimes are punished. That the CIA won’t face any accountability for actually torturing people to death has now been cemented in a bipartisan way by a craven president who accepted the Nobel Peace Prize while proceding to make a mockery of the Geneva Conventions for four years. Not prosecuting torture – not torture-homicides – is a grotesque violation of Geneva and makes the current president a violator of Geneva. He better not complain when an American soldier is captured and tortured to death.

There’s a parallel here, I think, with Tony Blair’s tenure as Prime Minister. At the time, I thought that Blair’s support for the Iraq war and his consistent and flagrant lying made him unworthy of re-election. If he had continued to stand as Labour leader against the Conservatives, I genuinely don’t think I could have voted for him or the Labour Party. That’s not to say I would have voted for the Conservatives, but I felt Blair’s transgressions were so severe that he should be kept out of office at all costs. But now, I’m not so sure about my position, and that’s largely because of the choice voters face in the US this year.

Bob Cesca is often accused of being an ‘Obama-bot’ due to his support of the President, but it’s a simplistic label that betrays a far more nuanced understanding of the American political system. Bob has written perhaps the most persuasive argument in support of re-election Obama this year, and I’m inclined to agree. Here’s his response to Cusack and Turley’s suggestion that progressives should stay at home in November:

When liberal policies and liberal politicians fail, they’re invariably replaced with moderate or conservative policies/politicians. That’s a sad fact of life in American politics. For instance, every time healthcare reform has failed, the next iteration has been more conservative — not less. When the Carter administration failed to be re-elected, the next Democratic president was more conservative. If Barack Obama fails to win re-election, the next Democratic president will absolutely be more conservative, especially if pollsters determine that liberals by-in-large stayed home…..

Imagine if the bulk of the progressive movement attempted Turley’s strategy of staying home until the day when sometime ambiguously in the future the red/blue paradigm vanishes… maybe? Is there really a long term plan for this destruction of the red/blue paradigm? You know, other than: 1. Stay Home, 2. ?????, 3. Progressivism! And how does Turley’s support for the Citizens United decision and corporate “speech” in elections help this plan? I can only imagine the cavalcade of Republican presidents or centrist Democrats who would fill the void. Two decades worth? More? Who knows. One thing is for sure, the progressive movement would have to possess considerably more electoral heft than it does today in order to yank with it the weight of the entire American political system. It’s shockingly delusional and naive. It’s a “Goodbye Cruel World” move — with severe blowback against the very ideas that these activists hold sacred.

The truth is that there is no plan for a third party, no plan to build a serious left wing economic model, no plans for a progressive infrastructure of government, other than those laid out by obscure professors, internet writers and disjointed activist groups. This isn’t to say that their plans are bad, its just no one knows about them or takes them seriously.

In reality, most people on the Left screaming to depose Obama won’t actually bear the brunt of what happens should Romney get in. They are largely privileged white people from upper middle class backgrounds who are resilient to the economic and political decisions of their leaders. It isn’t the same for the majority of Americans who would face cuts in education, health care and welfare on an unprecedented scale and the possibility of more war in the Middle East where their sons and daughters will be sent. Letting a Republican back in now sets what progress has been made under Obama by years and causes untold hardship to millions of Americans who deal with serious poverty on a day to day basis.

We can see the effects in Britain of a Right wing government in power right now. The economy is floundering, poverty is increasing dramatically (particularly affecting children), and the government has gone to war with unions putting workers rights under serious threat. The British Tories are a bunch of socialist pansies compared to the militant brand of corporate capitalism espoused by Mitt Romney and Paul Ryan, and their agenda for America is extremely dangerous to the majority of the population.

There is no doubt that Obama has committed some very, very serious transgressions against the constitution, and anyone with the faintest respect for the law and human rights should be seriously troubled. But what is the alternative? As Bob writes:

A Romney administration would roll back everything the Obama administration has achieved, painfully rewinding the legislative clock back to 2008. Do the list. DADT would return. Conservatives would gain a stranglehold on the Supreme Court. Marriage equality would be held back by another decade. Women’s reproductive organs would become the total purview of the government. Obamacare and all of its benefits would be repealed. New emissions standards would be repealed. We’d return to war in the Middle East — with either Syria or Iran or both, and maybe even Russia, in the crosshairs. The climate crisis would escalate unchecked. And the Bush tax cuts would become permanent. To name a few. Pretty much the worst possible outcome you can imagine. You might disagree with President Obama, say, 20% of the time with 10% being “Rubicon line” worthy. But I guarantee that you’ll disagree with 100% of the Romney agenda and all of the horrendous policies within.

I understand where the hard Left is coming from when it comes to many of Obama’s policies – lines have been crossed and to have no ramification shows a very serious state of decline in America’s democratic and legal integrity. But by walking away from the electoral process, people will suffer if the Republicans get in, because it can and will get a lot worse. It is sad to argue that it is important to vote in order to prevent the other side getting in – it would of course be better to vote for something, but that is reality and until there is a serious alternative, it’s worth getting behind the candidate who’s policies result in the best over all outcome.

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Following his decision to cancel his ‘Leadership’ talk at the Discovery Invest Leadership Summit in Johannesburg last week with Tony Blair, Desmond Tutu has penned an article for the Observer outlining his rationale behind the well publicized snub:

On what grounds do we decide that Robert Mugabe should go the International Criminal Court, Tony Blair should join the international speakers’ circuit, bin Laden should be assassinated, but Iraq should be invaded, not because it possesses weapons of mass destruction, as Mr Bush’s chief supporter, Mr Blair, confessed last week, but in order to get rid of Saddam Hussein?

The cost of the decision to rid Iraq of its by-all-accounts despotic and murderous leader has been staggering, beginning in Iraq itself. Last year, an average of 6.5 people died there each day in suicide attacks and vehicle bombs, according to the Iraqi Body Count project. More than 110,000 Iraqis have died in the conflict since 2003 and millions have been displaced. By the end of last year, nearly 4,500 American soldiers had been killed and more than 32,000 wounded.

On these grounds alone, in a consistent world, those responsible for this suffering and loss of life should be treading the same path as some of their African and Asian peers who have been made to answer for their actions in the Hague.

The chances of this happening are close to zero, but it’s good that prominent global figures like Tutu continue to ostracize Blair for his outrageous behavior over the Iraq war. The former British PM is not a popular character in Britain, or most of the world outside of America, and rightly so. While the cost isn’t particularly high for him (he has retired to a rather nice life of bank consulting and charity work), having to live with armed security in his own country for the rest of his life is some consolation to the millions of lives he helped destroy.

To understand just how much Blair is hated, check out this clip from a new BBC comedy show called ‘The Revolution Will be Televised’ where the host Heydon Prowse tries to petition people to make Tony Blair a Saint, then goes to Blair’s house to deliver a stained glassed window with Blair’s face on it:

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Desmond Tutu: No time for Tony Blair. Photo credit: Wikipedia)

Good for Desmond Tutu. From the BBC:

Archbishop Desmond Tutu has pulled out of an event because he refuses to share a platform with Tony Blair.

The veteran peace campaigner said Mr Blair’s support for the Iraq war was “morally indefensible” and it would be “inappropriate” for him to appear alongside him.

The pair were due to take part in a one-day leadership summit in Johannesburg, South Africa on Thursday.

Mr Blair’s office said he was “sorry” the archbishop had decided to pull out.

Dr Tutu, who was awarded the Nobel Peace Prize in 1984 in recognition of his campaign against apartheid, and Mr Blair were due to appear at the Discovery Invest Leadership Summit….

In a statement, Dr Tutu’s Office said: “Ultimately, the archbishop is of the view that Mr Blair’s decision to support the United States’ military invasion of Iraq, on the basis of unproven allegations of the existence in Iraq of weapons of mass destruction, was morally indefensible.

“The Discovery Invest Leadership Summit has leadership as its theme. Morality and leadership are indivisible.

“In this context, it would be inappropriate and untenable for the archbishop to share a platform with Mr Blair.”

I’ve long believed that Tony Blair bears more responsibility for the Iraq war than the Bush Administration because unlike the ideologically driven American government, he knew exactly what he was doing and understood the consequences of attacking the defenseless nation. Despite the obvious evidence that Saddam Hussein did not have weapons of mass destruction or that Iraq posed a threat to anyone, Blair lied and lied and lied in order to engage Britain in a war that the majority of the public did not want. Blair was instrumental in building the basis for an attack on Iraq and helped Bush create the fragile international consensus that gave the assault a veneer of legitimacy.

As the evidence became harder and harder to hide from, Blair refused to acknowledge the truth and made a fool of himself by continuing to parrot George Bush and deceive the public. It was excruciating to watch him, a highly intelligent man, making nonsensical arguments that deep down he knew were ridiculous. And everyone knew why. Blair was enamored with Bush and his power post 9/11, and he was too cowardly to stand up to him when it became clear America was determined to attack Iraq no matter what. Blair has consistently tried to portray his decision to join in the assault as a moral decision – a bold move against a tyrannical dictator that he was doing out of bravery and Christian duty. In response to Desmond Tutu’s refusal to stand on stage with Blair, the former British prime minister’s office released the following statement:

As for the morality of that decision we have recently had both the memorial of the Halabja massacre where thousands of people were murdered in one day by Saddam’s use of chemical weapons; and that of the Iran-Iraq war where casualties numbered up to a million including many killed by chemical weapons.

Of course Blair’s office omitted the fact that the US and Britain stood by Saddam while he committed those atrocities, sold him weapons and bankrolled his war against Iran. But Blair was never one to let the truth get in the way of his ambitions.

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Tony Blair: Too close to Murdoch?

Tony Blair has told the Leveson inquiry that Rupert Murdoch did not lobby him directly over media policy when he was prime minister and highlighted examples where his government had gone against the News Corporation founder’s wishes.

Blair said on Monday that he and Murdoch had “a working relationship until after I left office”. After this they became closer and Blair was godfather to Murdoch’s daughter Grace, he added.

He told Lord Justice Leveson that Murdoch “didn’t lobby me on media stuff”, but said that was “not to say we weren’t aware of the positions their companies had”, in particular his strong views in opposition to European integration.

But he said on regulatory matters affecting Murdoch’s business directly, “we decided more often against than in favour”.

Lance Price, former Labour and No 10 press officer, had previously described Murdoch as the “24th member of the cabinet”.

Blair said: “Am I saying he’s not a powerful figure in the media? Well no, of course he is, and, of course you’re aware of what his views are, and that’s why I say part of my job was to manage the situation so that you didn’t get into a situation where you were shifting policy.

“I would say very strongly we managed the position that I believed in on Europe and that was a position the Sun and the News of the World frequently disagreed with me on.”

On his relationship with Murdoch, Blair said: “Europe was the major thing that he and I used to row about. I believed in what I was doing, I didn’t need him or anyone else to tell me what to do.”

Robert Jay QC, counsel to the inquiry, said Price had also said he had been told Blair would never change policy on Europe without talking to Murdoch first.

He replied: “No we would never have given an assurance to Mr Murdoch or anybody else that we were not going to change policy without seeking their permission. That’s absurd.

“Having said that, if we were about to engage in a major change of policy on an issue that mattered to any particular media group we would probably have tried to prepare the way for it, but I think that is perfectly sensible and there’s nothing wrong with that.”

Blair also said that his relationship with Murdoch changed after he stepped down as prime minister in 2007. “So I know there has been all this stuff about me being godfather of one of his children. I would never have become a godfather of his children on the basis of my relationship in office. After I left, I got to know him and his family and the relationship can be easier and better,” he said.

Read more at the Guardian…

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CEO of JP Morgan Jamie Dimon: Not doing such a good job (Photo credit: Wikipedia)

By Ben Cohen: The news that JP Morgan Chase lost $2 billion this quarter due to what CEO Jamie Dimon called ‘errors, sloppiness and bad judgment” should come as no surprise given the state of regulation on Wall St. While regulators are trying to ensure these ‘sloppy’ investments don’t blow up and bring the financial system down, the banks are fighting them all the way claiming that government interference would harm their productivity.

The losses incurred by JP Morgan were the result of an an extremely complicated and risky hedging strategy that involved derivative trading  – a practice that regulators have tried unsuccessfully to either ban or severely curtail (thanks to pressure from Wall St).  The New York Times has done a good job of summarizing what went down:

JPMorgan likely structured the trade in such a way that effectively magnified losses. Specifically, the bank bought insurance against losses on corporate debt through credit derivatives that increase in value if the underlying creditworthiness of companies is perceived to have deteriorated. But JPMorgan stumbled when it tried to modify that trade by also making an opposite bet with credit derivatives.

This type of trading where a bank essentially sells customers incredibly risky financial products then bet they will fail almost took the global economy down four years ago.  JP Morgan is still bullish on this risky financial practice and Dimon has refused to budge despite calling the trade “poorly constructed and poorly monitored”. Dimon has a reputation for speaking his mind, and given his successful stewardship of the banking giant thus far (it survived the financial crisis in 2008) he holds considerable sway in political circles.  From the Sydney Morning Herald:

In the words of Britain’s former PM Tony Blair, who has drawn pounds 1m a year as an adviser to JPMorgan: ‘‘He’s [Jamie Dimon] somebody who’s direct. He’s not somebody who’ll sit in a meeting when someone says something he disagrees with quietly. He’ll get up and speak.’’

Nowhere has he demonstrated this more than in his attacks on the post-crisis regulatory crackdown. ‘‘Dodd Frankenstein’’ is Dimon’s phrase for the Dodd Frank Act that has increased the oversight of banks and hit them with stricter capital requirements.

‘‘I think market participants are overwhelmed by all the amount of regulation and change being imposed at one time,’’ said Dimon last year, fulminating over the ‘‘anti-American’’ behaviour of regulators, while claiming the new rules were ‘‘hamstringing economic growth’’.

As Matt Taibbi writes, this would be fine if JP Morgan’s risky trading practices only hurt itself:

If you’re wondering why you should care if some idiot trader (who apparently has been making $100 million a year at Chase, a company that has been the recipient of at least $390 billion in emergency Fed loans) loses $2 billion for Jamie Dimon, here’s why: because J.P. Morgan Chase is a federally-insured depository institution that has been and will continue to be the recipient of massive amounts of public assistance. If the bank fails, someone will reach into your pocket to pay for the cleanup. So when they gamble like drunken sailors, it’s everyone’s problem.

Activity like this is exactly what the Volcker rule, which effectively banned risky proprietary trading by federally insured institutions, was designed to prevent.

This system of socialized risk and privatized profit makes a complete mockery of capitalism and free markets. This blatantly obvious contradiction seems to be lost on people like Dimon who confidently denounce the ‘anti American’ government then take billions of dollars from it without batting an eyelid. JP Morgan’s losses this quarter may not cripple the bank, but it definitely puts a big dent in Dimon’s argument. Writes Felix Salmon:

JP Morgan more or less invented risk management. If they can’t do it, no bank can. And no sensible regulator can ever trust the banks to self-regulate.

JP Morgan is now in damage limitation mode and busily getting rid of senior management, but it is losing the long term PR war because at the end of the day its ability to make money matters most, and it clearly isn’t doing that very well.

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The information was not made public and its disclosure in an interview with Mrs Murdoch in Vogue will prove highly embarrassing for Mr Blair.

His close ties to the Murdochs could explain his reluctance to condemn the News International phone hacking scandal…..

No mention was made of Mr Blair’s role as a godfather to Grace and he did not appear in pictures of the ceremony, which took place at the spot where it is said that Jesus was baptised.

However, the facts emerged in an interview with Mrs Murdoch in the fashion magazine.

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New evidence has emerged that supports the notion that George Bush and Tony Blair planned on attacking Iraq regardless of a second UN resolution. From the Guardian:

Britain and the US were planning to take action against Saddam Hussein without a second UN resolution five months before the invasion of Iraq, a newly released letter from Tony Blair's office shows.

A letter from Blair's private secretary reveals that "we and the US would take action" without a new resolution by the UN security council if UN weapons inspectors showed Saddam had clearly breached an earlier resolution. In that case, he "would not have a second chance".

That was the only way Britain could persuade the Bush administration to agree to a role for the UN and continuing work by UN weapons inspectors, the letter says.

Dated 17 October 2002, it was written by Matthew Rycroft to Mark Sedwill, private secretary to the foreign secretary, Jack Straw. "This letter is sensitive," Rycroft underlined. "It must be seen only by those with a real need to know its contents, and must not be copied further."

Anyone who paid attention during the lead up to the Iraq war should have been highly aware that the Bush administration and the Blair government were determined to attack Iraq regardless of evidence and regardless of legality. You could tell simply by the fact that there were no good reasons to pick on Iraq. There was no proven connection between Saddam Hussein and Al Qaeda, no connection between Iraq and 9/11, and nothing other than extremely dubious photographic evidence of Weapons of Mass Destruction and dodgy third hand information about yellowcake uranium in Niger. In reality, Iraq was a random Arab country that had lots of oil and no way of defending itself – the key ingredients for a quick land grab by two imperial powers.

I remember thinking everyone had gone mad – that no sane person could possibly buy into the nonsense put forward by the US and UK governments. As it turned out, the skeptics were correct and the entire premise for the war was exposed as a giant fraud. Amazingly, Bush and Blair got off scott free despite incinerating Iraq, losing billions of dollars and killing hundreds of thousands of people.

And even as the evidence continues to mount, there seems to be no talk of repercussion for the ex leaders now bringing in millions of dollars from after dinner speeches and bank consulting gigs.

While George Bush isn't bright enough to understand what he did, there is a part of Tony Blair who must know that what he did was wrong. Blair is an intelligent man, and revelations like the above will not be brushed aside easily. Unfortunately, the consequences of admitting even a portion of his hubris and deceit have the potential to unravel a bottomless well of wrong doing – and Blair just isn't brave enough to confront the demons he has gotten so used to living with.

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