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Krugman the Keynesian
by William Anderson


Ever since he started writing his semi-weekly column for the New York Times, Paul Krugman has been a lightning rod of sorts. The Princeton University faculty member has become the Times' resident "expert" on economic issues, and he usually fails to disappoint, at least if creating controversy constitutes success.

I admit to being a regular reader of Krugman's columns, and I suspect that many of my fellow economists on all sides of the ideological divide read him as well, which is one reason the Times has made him a featured star. Of course, being of the Austrian School of Economics, I find very little in Krugman's statements on economics with which I can agree. (I think that some of his criticisms of the Bush Administration's policies are correct—and especially the war in Iraq—although the policy alternatives that he presents usually are as bad or even worse.) In fact, whenever I email Krugman's columns to my friends—which I do often—I also send the accompanying message, "Krugman is evil."


Yet, it does no good simply to accuse one of the nation's most "elite" economists—most likely a future Nobel Prize winner—of being "evil." He may be a right decent fellow, for all I know. What I consider to be evil is not his personality nor his Massachusetts Institute of Technology pedigree nor his wealth and fame. Rather, I consider that the policies he recommends are evil because, in the end, they constitute fraud. That's right, fraud.

Before deconstructing Krugman's economic views, let me also say that at least when it comes to his columns, he is more of a political operative than he is an economist. (That being said, many "public intellectuals" also are little more than shills for political parties, both left and right.) If all we read on economics were Krugman's columns, we would learn that Bill Clinton gave us prosperity because his administration pushed a tax increase through Congress in 1993. That tax increase, says Krugman, enabled us to "balance" the federal budget, which magically created a good economy. (That the federal budget actually was never "balanced" in conventional accounting terms, and that the alleged balanced budgets occurred late in Clinton's term during the Fed-created unsustainable boom, and not when taxes were increased seems to be off Krugman's radar screen.)

Furthermore, his columns claim that Clinton's government was the model of "fiscal responsibility," and is always full of praise for the former president's policies. My guess is that if the Clinton Administration were in power now and following basically the same budgetary and legal priorities as the Bush Administration is currently doing, he would be writing excuses for Clinton.

However, let me say that since my own writings have been extremely critical of the Bush Administration and both political parties, it does not bother me to read Krugman's anti-Republican rants. What does bother me is that the man pretends to be something he clearly is not: an economist.

That is correct. Let me say it again. Paul Krugman is not an economist. His colleagues in the economics profession and the editorial board of the Times may call him an economist, but that does not make him one.

This is harsh criticism, I realize, so I must explain my views in full. Yes, Krugman has a Ph.D. from MIT in economics, but his writings, both popular and academic, demonstrate that he does not believe in laws of economics. Instead, like most folks with socialist leanings, he believes that the state is both omniscient and omnipotent and simply by fiat can eliminate those pesky little problems caused by scarcity.

If one can surmise anything from Krugman's columns, it is that he is an unabashed Keynesian. While others in the economics profession have forsaken the Keynesian faith for things like "Rational Expectations" or "Real Business Cycles," Krugman remains true to the Church of John Maynard Keynes.

For example, he freely uses the term "liquidity trap," a Keynesian invention, to describe the current situation in Japan. The real problems holding back Japan—the failure of the Japanese state to permit the liquidation of long-malinvested capital—is totally off Krugman's radar screen. (Of course, Japan also tried for a decade to engage in Keynesian "fiscal stimulus" by engaging in huge and expensive public works projects. Today, the nation is left with massive public debt, white elephant projects, and rising unemployment and economic uncertainty.)

Other Keynesian ideals flow into Krugman's work as well. Tax cuts must always be undertaken in order to "stimulate aggregate demand," which means they must always be targeted toward those groups who pay the least in taxes. Since the Church of Keynes preaches that saving by people who are wealthy is an important reason that aggregate demand dries up, upper-income individuals must always be heavily taxed so their money will be "spent," not saved or invested in projects that fail to meet Krugman's approval.

In nearly every column, Krugman attacks the moderate tax cuts pushed by the Bush Administration, blaming them for every evil from the current "jobless recovery" to bad food for U.S. troops in Iraq. The reason for his harsh criticism is not just his political partisanship (although that is obvious in nearly everything he writes). Krugman is one who believes that "aggregate demand" fueled by consumer spending is economic salvation, so anything that actually cuts the tax rates for highest income earners is heresy to him.

The reason that I classify Krugman as a noneconomist, however, is not simply his faith in Keynesian orthodoxy. It is because Krugman demonstrates time and again that in his view, economics is nothing more than a chessboard game of aggregates and statistics. For example, Krugman is a strong supporter of fiat money. Furthermore, his theoretical views of money fall into the category of money being nothing more than a quantity variable.

While presenting money as simply a mass of quantities permits one to engage in all sorts of seemingly impressive mathematics, it says absolutely nothing about money itself. Without an understanding of money as a productive asset, and without understanding that money cannot be separated from the actions of individuals, one literally cannot talk about money at all and make economic sense. Yet, there is nothing in any of Krugman's works that suggests a marginal utility approach to monetary theory. Money simply is "M" in the equation of exchange MV = PY, and that is as far as it goes.

Of course, Krugman's alleged specialty is international trade, where he supposedly has made a case for moderate protectionism as a way to prosper a nation. Unfortunately, like his other works, Krugman's work in international trade is basically an extension of macroeconomics, at least if my copy of his International Economics text is typical of his viewpoint.

Trade, according to Krugman, does not involve exchanges between individuals; no, trade occurs between nations, and, more importantly, nation states. It is almost as though the government of the United States trades with the government of Japan. While there is the requisite lesson on comparative advantage, it is presented entirely as an exchange between the fiction called "countries," and not as a basis for all exchange between individuals.

Even when Krugman delves into "microeconomics," he commits the same blunders as the rest of the mainstream. Economists have known since the first days of the marginalist revolution that interpersonal utility comparison are impossible to make. While ideas like "consumer surplus" and "welfare losses" can be presented in graphical form as teaching tools, they actually are works of fiction, since their use requires that one measure utility in cardinal, not ordinal, terms. Of course, the use of cardinal utility permits economists to present economic theory in mathematical terms through multivariable calculus, which is one reason that it remains in use as an explanatory tool even though it is thoroughly bogus.

Lastly, Krugman's columns demonstrate that he is unable to engage in logical arguments. Take his criticism of tax cuts, for example. His main objection is that those who "benefit" the most are "the rich." That is the extent of his argument; wealthy individuals will receive larger reductions in taxes than less-wealthy individuals, so tax cuts that slice off marginal rates are bad. Nowhere does he point out that even a tiny reduction in the top income tax rates will yield fairly large decreases in taxes wealthy individuals pay because those people pay the lion's share of taxes in the first place. In other words, the vaunted economist does not argue in economic terms; he simply appeals to envy and calls it economic thinking.

Even when Krugman "gets it right," he actually is wrong. In recent columns, he has admitted that there were speculative excesses in the stock market and elsewhere. However, in Krugman's world, that just happens because such unwise speculation, in his opinion, is simply nothing more than a trait of capitalism. Like most noneconomists posing as economists, Krugman does not acknowledge what Carl Menger wrote in the first lines of the first chapter of his path-breaking Principles of Economics: "All things are subject to the law of cause and effect."

Yes, Krugman admits there was unwise mass speculation during the latter years of the "fiscally responsible" Clinton Administration, yet he has no idea from whence it came, other than to place his faith in Keynes' dictum that these things were the results of the "animal spirits" that are released by capitalism. While Austrians can clearly point to the reckless credit expansion by the Federal Reserve during the late 1990s as the cause of the speculative bubbles, Krugman has nowhere to turn other than to say that capitalists are stupid people who need the guidance of the state.

No doubt, Krugman is an "authoritative" voice to those who advocate statism. He is a product of an elite university and has taught at the "highest levels" of academe since first earning his doctorate. Thus, those who cite Krugman as an authority in economics commit the informal fallacy of argumentum ad verecundiam (appeal to authority). However, if one wishes to appeal to logic, clear thinking, and the realization that economic analysis begins with the individual, then Krugman is not the person to whom one goes to find answers. One might as well call on a politician for intellectual sustenance as to call on Paul Krugman. In the final analysis, both will provide the same answer: expand the state, and when that creates problems, expand the state some more.


William Anderson, an adjunct scholar of the Mises Institute, teaches economics at Frostburg State University.

Frostburg State? MIT? Frostburg State? MIT? Frostburg State? MIT?

Those are very hard choices...

Greenspan and the bubble
by Paul Krugman
http://smirkingchimp.com/article.php?si ... ed&order=0
Most of what Alan Greenspan said at last week's conference in his honor made very good sense. But his words of wisdom come too late. He's like a man who suggests leaving the barn door ajar, and then - after the horse is gone - delivers a lecture on the importance of keeping your animals properly locked up.

Regular readers know that I have never forgiven the Federal Reserve chairman for his role in creating today's budget deficit. In 2001 Mr. Greenspan, a stern fiscal taskmaster during the Clinton years, gave decisive support to the Bush administration's irresponsible tax cuts, urging Congress to reduce the federal government's revenue so that it wouldn't pay off its debt too quickly.

Since then, federal debt has soared. But as far as I can tell, Mr. Greenspan has never admitted that he gave Congress bad advice. He has, however, gone back to lecturing us about the evils of deficits.



Now, it seems, he's playing a similar game with regard to the housing bubble.

At the conference, Mr. Greenspan didn't say in plain English that house prices are way out of line. But he never says things in plain English.

What he did say, after emphasizing the recent economic importance of rising house prices, was that "this vast increase in the market value of asset claims is in part the indirect result of investors accepting lower compensation for risk. Such an increase in market value is too often viewed by market participants as structural and permanent." And he warned that "history has not dealt kindly with the aftermath of protracted periods of low-risk premiums." I believe that translates as "Beware the bursting bubble."

But as recently as last October Mr. Greenspan dismissed talk of a housing bubble: "While local economies may experience significant speculative price imbalances, a national severe price distortion seems most unlikely."

Wait, it gets worse. These days Mr. Greenspan expresses concern about the financial risks created by "the prevalence of interest-only loans and the introduction of more-exotic forms of adjustable-rate mortgages." But last year he encouraged families to take on those very risks, touting the advantages of adjustable-rate mortgages and declaring that "American consumers might benefit if lenders provided greater mortgage product alternatives to the traditional fixed-rate mortgage."

If Mr. Greenspan had said two years ago what he's saying now, people might have borrowed less and bought more wisely. But he didn't, and now it's too late. There are signs that the housing market either has peaked already or soon will. And it will be up to Mr. Greenspan's successor to manage the bubble's aftermath.

How bad will that aftermath be? The U.S. economy is currently suffering from twin imbalances. On one side, domestic spending is swollen by the housing bubble, which has led both to a huge surge in construction and to high consumer spending, as people extract equity from their homes. On the other side, we have a huge trade deficit, which we cover by selling bonds to foreigners. As I like to say, these days Americans make a living by selling each other houses, paid for with money borrowed from China.

One way or another, the economy will eventually eliminate both imbalances. But if the process doesn't go smoothly - if, in particular, the housing bubble bursts before the trade deficit shrinks - we're going to have an economic slowdown, and possibly a recession. In fact, a growing number of economists are using the "R" word for 2006.

And here's where Mr. Greenspan is still saying foolish things. In his closing remarks he suggested that "an end to the housing boom could induce a significant rise in the personal saving rate, a decline in imports and a corresponding improvement in the current account deficit." Translation, I think: the end of the housing bubble will automatically cure the trade deficit, too.

Sorry, but no. A housing slowdown will lead to the loss of many jobs in construction and service industries but won't have much direct effect on the trade deficit. So those jobs won't be replaced by new jobs elsewhere until and unless something else, like a plunge in the value of the dollar, makes U.S. goods more competitive on world markets, leading to higher exports and lower imports.

So there's a rough ride ahead for the U.S. economy. And it's partly Mr. Greenspan's fault.

Credit issuers get gold mine, we get shaft
by Dave Zweifel
http://www.madison.com/captimes/opinion ... 47&ntpid=2
Now we know the reason why the big credit card companies lavished Congress with all that money so they could get the bankruptcy laws rewritten.

A report in the New York Times last week told how the big card issuers are soliciting big-time the 2 million Americans who only last year rushed to declare bankruptcy to beat the deadline of the new law that tilts the playing field in favor of the big lenders.

"Every day, I get at least two or three new credit card offers Citibank, MasterCard, you name it they want to give me a credit card, at pretty higher interest rates," said a woman who got into financial trouble because of previous credit card use. "I've got a stack of these things on my table. It's tempting, but I've sworn them off."



The banking industry spent more than $100 million lobbying for the new bankruptcy law, which makes it harder for consumers who have fallen on hard times to escape credit card debt.

And, alas, that's the key saddle the folks who have a history of trouble with credit card debt with yet more debt, charge them above average interest rates, and then have them on the hook for years to come under the new law. What a great profit center.

The bankers, of course, defend the solicitation of recently bankrupt card users, claiming it gives them a chance to get on their feet.

"If you take away the opportunity to get credit," a spokeswoman for the American Bankers Association said, "It's like taking away the want ads from a job-seeker."

But others point out that the credit industry is preying on the most vulnerable consumers and in return for this "fresh start" of credit, they charge interest rates of 23 percent.

Some cynics contend the industry is trying to recoup some of the hits it took when those Americans filed bankruptcy before the deadline last Oct. 17.

Credit cards are the banks' largest profit centers and late fees and high interest rates make them even more so.

"The whole business model of the credit card industry is built around outstanding debt," a researcher for the Center for Responsible Lending told the Times.

Indeed, about 85 million Americans today carry a credit card balance, now averaging $9,000. Those who pay only the monthly minimum payment would take 42 years to pay off the debt.

And while the industry was telling Congress that the old bankruptcy law was hurting them, it turns out that while bankruptcy filings increased 17 percent over the last eight years, credit card profits went up 163 percent.

Once again, corporate interests, with their tens of thousands of dollars in handouts, get their way.

The little guy gets the shaft.

Donald Luskin

Paul Krugman ends today's column demonizing conservative think tank scholars getting paid by lobbyists to write op-eds, by asking:
And inquiring minds want to know: Who else is on the take? Or has the culture of corruption spread so far that the question is, Who isn't?
Indeed. Does Krugman write his op-eds for free? Or is he paid by a liberal lobbyist known as the New York Times? And was he not paid by Enron as a member of its advisory board when he wrote glowing articles about it for Fortune?

So, Krugman was actually right. The right-wing response, instead of soul-searching is to see whether the other side is paid-off. Either Krugman is a genius or the other side is intellectually bankrupt? Latter seems to be the case

P.S> I have never been able to find John Abramoff along the list of media. I wonder if the right-wing wach jobs are getting paid by lobbysts and by the supposedly left-wing media? Makes one think. After all, New York Times also keeps William Krystol on their payroll. How lobbyist of them!

Time permitting I'll give you more Paul Crookman than you can handle. The best is yet to come:)

Why don't you supply more CrautHomer? There is a laugh and a half.

Donald Luskin

Wednesday, December 21, 2005

LITTLE MEN WITH LITTLE THINGS

Who was it that said that the measure of a man is what he worries about? President Bush is a big man who worries about big things like protecting America from global terrorism. New York Times columnist Paul Krugman -- Bush's most vicious media opponent and America's looniest liberal pundit -- is a little man who worries about little things, like whether conservative pundits are being paid too much by lobbyists, and whether retail workers are being paid too little by Wal-Mart.


In his column Monday Krugman excoriates conservative think tank scholars Peter Ferrara and Doug Bandow for taking money from indicted Republican lobbyist Jack Abramoff , allegedly in exchange for writing op-ed columns favorable to Abramoff's clients. Yes, the immediate intuition is that these men's ethics were compromised here. But, really, this is a little issue. Where's the beef? Everyone -- think tankers and op-ed writers included -- gets paid by someone . And those who pay, naturally, choose to pay scholars and journalists who tend to already agree with them. It seems unlikely, then, that Ferrara or Bandow would have written anything different whether or not Abramoff paid them.

Krugman himself is no different than Bandow or Ferrara. They are scholars at think tanks, and Krugman is a scholar at Princeton's Woodrow Wilson School of Public and International Affairs . And Krugman, too, gets paid by other people who rely on him to promote their viewpoints. First and foremost: that powerful liberal lobbying machine known as the New York Times . Since Krugman's Times column began in 2000, has he ever -- even once! -- taken a position substantively different from that of the ultra left-leaning Times editorial board -- the folks who write his extracurricular checks?

Krugman has taken other extra-curricular paychecks over the years, and he's always promoted the points of view of whomever wrote those checks. He took Enron's money as a consultant on its advisory board -- and, while on the payroll, wrote a glowing column about Enron for Fortune . To be fair, he disclosed the connection then. At that time, Enron was riding high and Krugman was proud to take the corrupt company's money. But he failed to mention the connection later -- after the company failed and had to stop paying him -- in dozens of New York Times columns lambasting the Bush administration for its past Enron connections. Most egregiously, he failed to mention his previous role as an Enron consultant in a Times column lambasting Enron's consultants !

And when Krugman wrote a Times column justifying the anti-Semitic ravings of Malaysia's premier Mahathir -- the Times captioned that Krugman column "Anti-Semitism with a purpose" -- he failed to mention that he had once been Mahathir's guest at a Malaysian economics conference , and had contributed to Malaysia's economic policies.

But where's the beef? Krugman may well have written all the same things even if he hadn't taken Enron's money, or Mahathir's hospitality. Indeed, one suspects that Krugman would proudly recycle in his columns all the same talking points he finds on the Democratic National Committee's web site and all the ultra-Leftist hateblogs, even if he had to dip into his own pocket and pay himself.

Consider Krugman's column on Wal-Mart last week. Krugman doesn't find anything corrupt about the "union-supported group, Wake Up Wal-Mart" that has run television ads demonizing the non-union retail giant. Would Wake Up Wal-Mart have run those ads anyway, without union money? Probably not, but Krugman would probably have written the same column, in which he makes the absurd claim that Wal-Mart -- by far America's largest employer -- destroys jobs. He even goes to far as to call Wal-Mart's claims to the contrary "the worst economic argument of 2005." Considering some of the loony economic arguments Krugman himself has made this year, that's quite a claim.

Who's paying Krugman to make such claims, other than the New York Times ? No one that I'm aware of, at least not directly. But unions supply a large fraction of the filthy lucre that fills the war chest of the Democratic Party . So, naturally, Krugman will take up their cause -- however absurd, and however hypocritical. Back in 1993 , when Krugman used to write as an economist, not a political hack, he called Wal-Mart "the most significant American business success story of the late 20th century," celebrating its application of "extensive computerization and a home-grown version of Japan's 'just in time' inventory methods to revolutionize retailing."

To back up his claims that Wal-Mart destroys jobs, Krugman cites the "sophisticated statistical analysis" in a paper by a University of California professor and two associates at the Public Policy Institute of California . But that paper only claims that Wal-Mart causes a drop in retail employment when it opens a store in a new community. Overall, it finds "there is some evidence that Wal-Mart stores increase total employment on the order of two percent."

A study by Global Insight goes further, but Krugman doesn't mention it. It says Wal-Mart is "responsible for 210,000 net jobs, a level of total factor productivity (general economic efficiency of the economy) that is 0.75% higher by 2004 than it would have been.... real disposable income is 0.9% higher than it would have been in a world without Wal-Mart." Why Krugman's silence on this study? The unions wouldn't be happy if he mentioned it.

Other liberal economists aren't so concerned with flattering the Democratic Party's paymaster. Jason Furman , a scholar at New York University (yes, he too, has another patron -- the leftist Center for Budget Policy and Priorities ), has recently written a paper on Wal-Mart . Krugman once wrote that Furman's work at CBPP is "absolutely impeccable; there is nothing at all like it on the right, or anywhere else." Surely Krugman would not say the same thing about Furman's statement that "Wal-Mart is a progressive success story...resulting in huge benefits for the American middle class and even proportionately larger benefits for moderate-income Americans."

By the way, perhaps this is a good time to mention that I don't get paid a penny for writing the Krugman Truth Squad column at National Review Online . Not by NRO, not by Jack Abramoff, not by anybody. Why do I do it? Because, like President Bush, I'm worried about the big things. And one of the best ways I can help with the big things is by keeping the little things -- like Paul Krugman -- cut down to size.

Donald Luskin is a fool. Krugman gets his salary from New York Times, to write for New York Times. The think tankers are paid to sacrifice their supposed journalistic integrity... Oh, wait, these are not journalists, are they?

P.S> I like Donald Luskin's defense: This is a small thing. Let's not worry about small things.

Maybe he should be a little more worried about defending his own client than showing off his ineptitude.

I'm sure the Walter Duranty class of journalists know a great deal about integrity.


LOL

Integrity is an unfamiliar word to the Donald Luskin type.

Characterizing Bill O'Reilly pro-Christmas views as anti-Semitic while downplaying Arab leaders' Holocaust-denying - integrity, the Walter Duranty Times' style:)

Nobody is downplaying Arab leaders' Holocaust denial. Certainly not at New York Times. Better check the usual suspects, Fucks News and the all manner of New York Post garbage and WSJ mullett wrappers.

As for silly o'Reilly's comments on Christmas, I wonder if he knows what Christmas means:

O’Reilly Teaches Viewers the True Meaning of Christmas
http://thinkprogress.org/2005/11/29/ore ... -christmas
According to Bill O’Reilly, Christmas is under siege from the “secular progressive agenda…to get Christianity and spirituality and Judaism out of the public square.” The self-described “leading general of the anti-secular forces in this country” often devotes radio and television segments to the issue around this time of year.

Thankfully, the man defending Christmas understands its true meaning. Here’s what he said on last night’s Factor:

Every company in America should be on its knees thanking Jesus for being born. Without Christmas, most American businesses would be far less profitable. More than enough reason for business to be screaming “Merry Christmas.”

O’Reilly speaks from experience. Featured prominently on his website is “The O’Reilly Christmas Store,” where loyal Factor viewers can buy books, jackets, and coffee mugs featuring the right-wing commentator’s favorite slogans.


Thank you, Leonid and Bill o'Reilly for teaching us what Christmas means.

O'Reilly attacked Media Matters: "the most vile, despicable human beings in the country"; called ADL president "a nut"
http://mediamatters.org/items/200412100002
FOX News host Bill O'Reilly lashed out at Media Matters for America and the Anti-Defamation League (ADL) on the December 9 Radio Factor with Bill O'Reilly. He called Media Matters "the most vile, despicable human beings in the country"; called the ADL "an extremist group that finds offense in pretty much everything"; and labeled ADL president Abraham Foxman "a nut."

The controversy began when Media Matters highlighted a remark that O'Reilly made to a Jewish caller on his December 3 radio show, and ADL president Abraham Foxman wrote to O'Reilly in protest.

When the caller on the December 3 Radio Factor objected to "Christmas going into schools" and explained that he "grew up with a resentment because I felt that people were trying to convert me to Christianity," O'Reilly informed him that the United States is "a predominantly Christian nation" and declared, "if you are really offended, you gotta go to Israel then." O'Reilly labeled the caller's concerns "an affront to the majority," insisting that "the majority can be insulted too." In his letter protesting the comments, Foxman wrote, among other things, that O'Reilly's comment "plays into one of the oldest anti-Semitic canards about Jews, that they are not full citizens of a country and are not entitled to all of the rights afforded to the majority."

O'Reilly claimed on his December 9 radio show that "the write-ups about this didn't put any of it in context." In fact, Media Matters' original item included the full text and audio of the December 3 exchange. O'Reilly added that the "write-ups" "didn't say it was about Christmas," apparently suggesting that if the public knew that O'Reilly was talking about Christmas when he told a caller to "go to Israel," the remark would seem less offensive.

O'Reilly also claimed that the controversy surrounding his remarks is "why nobody sticks up for Christmas except me." He replayed the audio clip of the controversial December 3 exchange and told listeners: "If you think that's anti-Semitic, I wanna know. Do you think that's anti-Semitic?"

Despite his recent attacks on Foxman, O'Reilly once valued his opinions highly. In February and March, he repeatedly cited Foxman as a trump card against critics who called Mel Gibson and his film The Passion of the Christ anti-Semitic. (On the February 16 edition of ABC's World News Tonight, Foxman said of The Passion: "I do not believe it's an anti-Semitic movie. I believe that this movie has the potential to fuel anti-Semitism, to reinforce it." On his December 9 radio show, however, O'Reilly recalled Foxman's role in the debate surrounding The Passion of the Christ but lied about what he said:

O'REILLY: All right, you remember that controversy last February. I stuck up for Gibson. I said he had the right to put out the movie. ... And, then Foxman, of course, called me an anti-Semite and Gibson was an anti-Semite -- this is the guy.

The truth is that in February and March, O'Reilly eagerly cited Foxman saying that Gibson and The Passion were not anti-Semitic.*

From O'Reilly's February 23 nationally syndicated column:

Even Abraham Foxman, the militant leader of the Anti-Defamation League, now admits the film is not anti-Semitic. Yet Foxman continues to object to it on the basis of what it might do.

From the February 26 O'Reilly Factor:

O'REILLY: So what you have is a controversy about anti-Semitism, which now Abraham Foxman, the head of the ADL says the movie isn't anti-Semitic. And when he says it, you got -- I think you got to believe it, as opposed to sacrilege on the -- with 90 percent of Americans are Christians.

From the March 8 O'Reilly Factor:

O'REILLY: New York Times writer Frank Rich continued his savage attacks on The Passion of the Christ movie yesterday, even though most of you have seen the film, including the head of the Jewish Anti-Defamation League believe it is not hateful towards Jews. Rich is smarter than all of us. If you see merit in this movie, you're either a moron, a sadist, and/or an anti-Semite according to Mr. Rich.

On his December 9 radio show, in response to a Jewish caller who explained that he "Christmas caroled [as a child] and it didn't bother me because I knew I was Jewish," O'Reilly declared: "You know, 99 percent of Jewish Americans are just like you. You know, and that's why the shame of this Anti-Defamation League -- they're just nuts." He added that Barbara Streisand, who is Jewish, sings Christmas carols well:

O'REILLY: And, here's the capper. Who's got one of the biggest-selling Christmas albums in history? Barbara Streisand! Barbara Streisand has made gazillions singing Christmas songs. And she sings 'em really well.

O'Reilly blasted Media Matters and the ADL throughout the December 9 radio broadcast:

O'REILLY: You have a defamation pipeline that starts in the Internet. So, every day The Radio Factor's on the air, we have these creeps -- and they really are the most vile, despicable human beings in the country -- who listen to every word of the program. And then they try to feed stuff out to the mainstream media to discredit me. I mean that's what they do every single day of the year, they do this. So, last Friday we had a caller. We were talkin' about the Christmas being discussed in schools and in the public arena -- and I'm gonna play you the call in a moment.

So, one of these far left websites taped it and they sent it to the Anti-Defamation League, which is an extremist group that finds offense in pretty much everything. Abraham Foxman is the national director. These are the people who accused anybody of liking The Passion of the Christ as anti-Semitic.

[...]

So, well you're gettin' the game here. You criticize anybody, you challenge anybody, then you are a bigot. And that's the -- that's why nobody does it. That's why nobody sticks up for Christmas except me. Did Peter Jennings stick up for Christmas last night? I don't believe he did. How about Brian Williams, did he? Did Rather stick up for Christmas? How about Jim Lehrer -- did he? Did Larry King -- hello -- I love Christmas -- did he? No.

All right. And the reason they don't is because of this. So, we are not intimidated. We know how dishonest and disgraceful the defamation pipeline is. And now we wanna hear from you. 1-877-9NO-SPIN. And believe me, I'm not portraying myself as a victim here. I am not doing that. I am attacking these people for being the worst element in American society.

Lemme repeat that. The left-wing websites who are responsible for all of this kind of stuff, and the journalists in the newspapers who print it without any context -- are the worst element -- non-criminal element in the country. The worst. All right? They undermine freedom of speech. They undermine all fair play. They are despicable, vile human beings -- ankle biters. So, I'm no victim 'cause I got a forum and I can give it right back to 'em.

[...]

The far left is getting pounded by The Factor. And Foxman is just a nut.

[...]

Now, I have now been accused by Abraham Foxman as [sic] being anti-Semitic because I said to the guy [the December 3 caller], "hey, you know, if it's drivin' you crazy you gotta go back to Israel."

Now, the write-ups about this -- didn't put any of it in context. Didn't say it was about Christmas. Didn't say it was about anything. The writer said, O'Reilly told a guy if he didn't like it go back to Israel. Dishonest, of course, blatant. That's what they do all day long.

[...]

Remember, more than 90 percent of American homes celebrate Christmas. But the small minority that is trying to impose its will on the majority is so vicious, so dishonest -- and has to be dealt with.

*Update: Media Matters for America updated this item at 4:00 p.m. ET on December 10 to include the quotation of O'Reilly falsely claiming that Foxman called O'Reilly, Gibson, and The Passion anti-Semitic.

US Savings Rate Sinks to Lowest Since Great Depression
by Philip Thornton
http://www.commondreams.org/headlines06/0131-03.htm
Americans spent $42bn (£24bn) more than they earned last year, turning the annual US savings ratio negative for the first time since the Great Depression.

The offical figures published yesterday, a day ahead of the retirement of the chairman of Federal Reserve Alan Greenspan, will be seen as a telling verdict on his 18 year reign at the US central bank.

Mr Greenspan is tonight expected to sanction the Fed's 14th consecutive interest rate rise - to 4.5 per cent - in part to temper the consumer boom and encourage saving again.

The savings ratio fell to minus 0.5 per cent last year, meaning Americans not only spent all of their after-tax income but also had to increase their borrowings or plunder their savings. This is the first time the ratio has gone negative for an entire year since 1932 and 1933, when the US was struggling to cope with the Great Depression.

The savings ratio is seen as a key economic indicator as it shows how vulnerable households are to a sudden shock such as a surge in interest rates or unexpected redundancy. Mark Zandi, an economist at the analysts' website Economy.com, said the low level of savings would became a problem only if interest rates continued to climb.
However, the markets are increasingly betting that the Fed will use its statement tonight to send a signal it is close to the end of its tightening cycle that began in 2004. Weak GDP figures for the final quarter of last year - showing that growth slowed from 4.1 to 1.1 per cent between the third and fourth quarters of the year - boosted that speculation.

But there is growing concern the housing bubble will burst, leaving millions of families nursing debts larger than their homes, or simply suffer a sudden slowdown - putting the brakes on the economy. It will be some time before Mr Greenspan's 18-year legacy at the helm of the world's most central bank is set in stone, and he has fans and critics in equal measure.

His supporters point to his calm captaincy of the US economy through the Wall Street crash of 1987, just weeks after he took over, the Asia crisis in 1997, the Long-Term Capital Management affair the following year, and the aftermath of the September 11 attacks. He averted recession - other than a brief dip by historical standards in 2001 - by showing himself willing to support investor confidence by flooding the market with liquidity. However, his critics say this was a flawed policy, whose negative consequences may be felt by the coming generation.

Critics argue his willingness to protect investors from their own speculative excess created what they called the "Greenspan put" - a one-way bet that ensured they would never have to account for their gambles. At the same time he allowed a succession of asset price bubbles to build up, the latest of which is the spike in residential property prices.

The Fed chief plans to end his days at the central bank with little fanfare. After the leaving the Fed, Mr Greenspan plans to open his own economic consulting business. He also may show up on the speaking circuit and write a book.