The Hijacked Crisis

But there’s another emotion you should feel: anger. For what we’re seeing now is what happens when influential people exploit a crisis rather than try to solve it.

For more than a year and a half — ever since President Obama chose to make deficits, not jobs, the central focus of the 2010 State of the Union address — we’ve had a public conversation that has been dominated by budget concerns, while almost ignoring unemployment. The supposedly urgent need to reduce deficits has so dominated the discourse that on Monday, in the midst of a market panic, Mr. Obama devoted most of his remarks to the deficit rather than to the clear and present danger of renewed recession.

What made this so bizarre was the fact that markets were signaling, as clearly as anyone could ask, that unemployment rather than deficits is our biggest problem. Bear in mind that deficit hawks have been warning for years that interest rates on U.S. government debt would soar any day now; the threat from the bond market was supposed to be the reason that we must slash the deficit now now now. But that threat keeps not materializing. And, this week, on the heels of a downgrade that was supposed to scare bond investors, those interest rates actually plunged to record lows.

What the market was saying — almost shouting — was, “We’re not worried about the deficit! We’re worried about the weak economy!” For a weak economy means both low interest rates and a lack of business opportunities, which, in turn, means that government bonds become an attractive investment even at very low yields. If the downgrade of U.S. debt had any effect at all, it was to reinforce fears of austerity policies that will make the economy even weaker.

So how did Washington discourse come to be dominated by the wrong issue?

Hard-line Republicans have, of course, played a role. Although they don’t seem to truly care about deficits — try suggesting any rise in taxes on the rich — they have found harping on deficits a useful way to attack government programs.

But our discourse wouldn’t have gone so far off-track if other influential people hadn’t been eager to change the subject away from jobs, even in the face of 9 percent unemployment, and to hijack the crisis on behalf of their pre-existing agendas.

Check out the opinion page of any major newspaper, or listen to any news-discussion program, and you’re likely to encounter some self-proclaimed centrist declaring that there are no short-run fixes for our economic difficulties, that the responsible thing is to focus on long-run solutions and, in particular, on “entitlement reform” — that is, cuts in Social Security and Medicare. And when you do encounter such a person, you should be aware that people like that are a major reason we’re in so much trouble.

For the fact is that right now the economy desperately needs a short-run fix. When you’re bleeding profusely from an open wound, you want a doctor who binds that wound up, not a doctor who lectures you on the importance of maintaining a healthy lifestyle as you get older. When millions of willing and able workers are unemployed, and economic potential is going to waste to the tune of almost $1 trillion a year, you want policy makers who work on a fast recovery, not people who lecture you on the need for long-run fiscal sustainability.

Unfortunately, giving lectures on long-run fiscal sustainability is a fashionable Washington pastime; it’s what people who want to sound serious do to demonstrate their seriousness. So when the crisis struck and led to big budget deficits — because that’s what happens when the economy shrinks and revenue plunges — many members of our policy elite were all too eager to seize on those deficits as an excuse to change the subject from jobs to their favorite hobbyhorse. And the economy continued to bleed.

What would a real response to our problems involve? First of all, it would involve more, not less, government spending for the time being — with mass unemployment and incredibly low borrowing costs, we should be rebuilding our schools, our roads, our water systems and more. It would involve aggressive moves to reduce household debt via mortgage forgiveness and refinancing. And it would involve an all-out effort by the Federal Reserve to get the economy moving, with the deliberate goal of generating higher inflation to help alleviate debt problems.

The usual suspects will, of course, denounce such ideas as irresponsible. But you know what’s really irresponsible? Hijacking the debate over a crisis to push for the same things you were advocating before the crisis, and letting the economy continue to bleed.

Island’s Naval Base Stirs Opposition in South Korea

ANGJEONG, South Korea — Dozens of banners adorn this village on the southern coast of South Korea’s southernmost major island, trumpeting anxieties that have invaded this otherwise idyllic community and divided it so deeply that residents say some fathers and sons have stopped talking to one another.
Related

*
Times Topic: South Korea

Related in Opinion

*
Opinion: The Arms Race Intrudes on Paradise (August 7, 2011)
*
Unwanted Missiles for a Korean Island (August 6, 2011)

Enlarge This Image
Jean Chung for the International Herald Tribune

Song Kang-ho opposes the base, fearing that it could draw South Korea into a regional conflict.

“Fight to the death against the American imperialists’ anti-China naval base!” says one banner.

That declaration — and the underlying issue dividing this village of 1,000 fishermen and farmers on Jeju Island — mirrors the broader quandary South Korea faces, caught between the United States, its longstanding military ally, and China, its former battlefield foe but now its leading trading partner.

In January, the South Korean Navy began construction on a $970 million base in Gangjeong. Once completed in 2014, it will be home to 20 warships, including submarines, that the navy says will protect shipping lanes for South Korea’s export-driven economy, which is dependent on imported oil. It will also enable South Korea to respond quickly to a brewing territorial dispute with China over Socotra Rock, a submerged reef south of Jeju that the Koreans call Ieodo. Both sides believe it is surrounded by oil and mineral deposits.

American ships cruising East Asian seas will be permitted to visit the port, the Defense Ministry says, and many villagers and anti-base activists from the Korean mainland suspect that the naval base will serve less as a shield against South Korea’s prime enemy, North Korea, than as an outpost for the United States Navy to project its power against China.

Fear of becoming “the shrimp whose back gets broken in a fight between whales” — a popular saying in this country, whose territory has been the battlefield of bigger powers — is palpable in this village, where palm trees sway in the wind and low-slung homes lie snug behind walls of volcanic rock.

“I don’t understand why we’re trying so hard to accommodate something people in Okinawa tried so hard to resist,” said Kim Jong-hwan, 55, a tangerine farmer, referring to the Japanese islanders’ struggle against the American military base there. “When I think how the Americans go around the world starting wars, I can only expect the worst.”

Older islanders have harrowing memories of war. Shortly before and during the 1950-53 Korean War, government troops cracking down on people they suspected of being leftists who might sympathize with North Korea devastated Jeju, burning villages and killing about 30,000 people, or one-tenth of the population. In 2005, the government designated Jeju, sometimes romanized as Cheju, as a “peace island.”

Cooperation Emphasized as Biden Visits China

EIJING — Vice President Joseph R. Biden Jr. and Chinese leaders emphasized on Thursday the need for economic cooperation at a time when the global economy is struggling with new crises. But a fistfight at an American-versus-Chinese good-will basketball game at night cast a shadow on the day’s diplomacy.

Multimedia

Reporter's Notebook: Biden Visits China

Close Video

See More Videos »

The American delegation had arrived anxious that the Chinese might express concerns over the country’s large holdings of American debt. But United States officials present at Mr. Biden’s meetings said Chinese leaders told him they still had confidence in the United States’ financial system and did not show worry over their country’s investments. Chinese officials did not provide a briefing for foreign reporters, so it was not immediately possible to get their version of what was said.

Recent commentaries from official Chinese news organizations had expressed alarm about China’s holdings after the debt ceiling crisis in the United States.

Mr. Biden, meanwhile, returned to an old theme: that China needed to build a more sustainable economy that would put greater weight on domestic consumption rather than exports. He emphasized that such a rebalancing was a way that China could help spur growth in the United States and other countries and address structural flaws in its own economy.

Reports Say Iran Has Convicted Hikers of Spying

Reuters

Detained Americans Shane Bauer, left, and Joshua Fattal smile as they wait to meet their mothers at the Esteghlal hotel in Tehran, in this May 21, 2010 file pictur

TEHRAN — Two Americans, Shane M. Bauer and Joshua F. Fattal, who have been detained in Iran for more than two years, have been convicted of spying and sentenced to eight years in prison, Iranian state television reported on Saturday, a verdict that will further strain already poor relations with Washington.

“In connection with illegal entry into Iranian territory each was given three years in jail and in connection with the charge of cooperating with American intelligence service, each was given five years in jail,” the IRINN Web site said, quoting an informed judiciary source. The two men have 20 days to appeal, the Web site said.

Mr. Bauer and Mr. Fattal were arrested on July 31, 2009 near Iran’s border with Iraq, along with a third American, Sarah E. Shourd, who was freed on $500,000 bail in September 2010 and returned home.

The trio, in their late 20s and early 30s, say they were hiking in the mountains of northern Iraq and, if they crossed the unmarked border into Iran, it was by mistake.

The affair has compounded tension between Tehran and Washington, which have had no diplomatic relations since the storming of the American Embassy after the 1979 Islamic Revolution.

Super PACs Changing 2012 Landscape

Sen. John McCain worked tirelessly a decade ago to achieve a long-desired reform of campaign finance law, working with another Republican and two Democrats to win approval of one of the last, big bipartisan policy bills Congress has passed. Under the Bipartisan Campaign Reform Act of 2002, no longer could corporate and labor special interests make massive, unlimited "soft money" donations to political parties. Corporations and nonprofits could no longer pay for "issue ads" that were really meant to advance a candidate's campaign, and the ads would have to be properly identified as electioneering efforts if they were broadcast close to an election. [Subscribe to U.S. News Weekly, now available as an iPad app.]





Now, McCain is the last original sponsor of the landmark legislation who is still in Congress; Democratic Rep. Marty Meehan has retired, and Democratic Sen. Russ Feingold and Republican Rep. Chris Shays both lost re-election bids. And McCain is alone to watch with sadness and furor the unraveling of his hard-fought campaign finance overhaul. Following legal and rules changes, campaigns are facing the unbridled power of the super PAC, a type of committee that is virtually unregulated in the amount of money it can raise and how it can spend it to advance campaigns for both Congress and the White House. "The U.S. Supreme Court opened the floodgates for all kinds of money from these groups," says McCain. "I just wish one of the justices had had to run a political campaign." Had the jurists been through that experience, McCain says, they might never have undone the progress Congress and federal election regulators have made since the early 20th century to control the influence of big money in politics.


Super PACs were enabled by the 2010 Supreme Court ruling in Citizens United v. Federal Election Commission. That 5-4 decision said the conservative group Citizens United could run a film critical of onetime presidential candidate Hillary Clinton and could advertise the movie in broadcast ads featuring Clinton's likeness. The ruling overturned the McCain-Feingold ban on corporate and union funding of electioneering ads, and paved the way for a slew of other special interests to spend unlimited cash doing the same thing in future elections. [Read the U.S. News debate: Is Citizens United hurting democracy?]


And the onslaught has already started: According to the Federal Election Commission, more than 100 groups have organized as super PACs, and such groups reported spending more than $65 million in the 2010 election cycle alone. Most of the groups are identified as conservative-leaning (former George W. Bush aide Karl Rove's project, American Crossroads, is the biggest), but more left-leaning groups are likely to organize and raise cash to re-elect President Obama, protect the Democratic majority in the Senate, and take back the House, says Anthony Corrado, a professor at Colby College in Maine and a specialist in campaign finance. [See which Senate seats the GOP is targeting in 2012.]


Alarmed campaign finance reform advocates worry about the explosion of super PACs because now special interests have been provided a legal way to get around entrenched campaign finance limits and laws: They can raise unlimited money—from anonymous sources, if the cash comes via a nonprofit organization. The super PACs can also pay unlimited amounts for "independent expenditures," and collect unlimited cash from corporations, nonprofit groups, and labor unions, which would not otherwise be allowed, under the law, to make direct contributions to a campaign. The super PACs, then, have more freedom to raise and spend than the men and women seeking office. "They're a very dangerous [force] in the system, because they're dealing with unlimited money and corporate wealth," says Fred Wertheimer, president and founder of Democracy 21, a nonprofit, nonpartisan group that supports campaign finance overhaul. "I don't believe they will take the campaigns away from candidates as a general proposition. But they will have important influence in targeted races."


Michael Beckel, a spokesman for the Center for Responsive Politics, says the super PACs are blazing "new territory" that effectively undoes McCain-Feingold. "They now have the freedom to say pretty much whatever they want, whenever they want, and pretty much as loudly as they want," Beckel says.

Obama Has Nothing To Lose With Jobs Push

Now that the debt ceiling fight is firmly behind him, President Obama is continuing his promised "pivot" away from budget issues and towards the troubled economy, with promises to confront Congress and push for legislation to create jobs. The White House has promised to unveil new economic plans in September, and administration officials told the Associated Press that his plan would include new construction and spending projects to boost jobs. The proposals will face steep, maybe impossible hurdles in Congress, where opposition to Obama and any new spending remains high. But for the president, having nothing to lose in this fight may be the point.

[See cartoons about the economy.]

Obama's style in the past has been to focus on the results of legislation, no matter how ugly the sausage-making process gets. In his push for healthcare reform and the stimulus package, he accepted painful compromises with Republicans and conservative Democrats to get the laws through. In standoffs with Republicans over tax cuts, the budget, and the debt ceiling, the president agreed to Republican demands which left his own party howling. Even when he came up short—for instance, with the defunct cap and trade bill—Obama focused on a pragmatic approach which accepted political realities. [See photos of the Obamas behind the scenes.]

But now the political reality, at least as many in Washington, D.C. see it, is that Republicans are unlikely to accept any new jobs legislation from the president. Opposition to the stimulus spending was one of the core principles of the Tea Party movement which swept the Republicans back into power in 2010, and no amount of deal-making will change freshmen Republicans' minds. And many believe that Obama's name is so toxic among Republicans that any plan he pushes, even if it seems favorable to conservatives, will likely be met with stiff resistance. [Check out political cartoons about the Tea Party.]

The situation has left many liberal observers hoping that Obama will use this as a chance to draw a firm contrast with Republicans, and paint them as opponents to economic recovery. "I think the point of it is to demonstrate to both the American people and to the markets that there's someone trying to get us out of the economic hole that we're in," says Michael Ettlinger, an economic analyst with the left-leaning Center for American Progress. "Not from a political, 'who's going to win, who's going to lose' standpoint, but from the standpoint of letting the voters have a say in whether we're going to take the measures we need to get job creation or not." [See 10 ways to create jobs.]

Perry Criticism Pushes Bernanke Further Into Political Limelight

As if Ben Bernanke's job were not already stressful enough, he is now finding his name dragged into the political fray, an unusual place for the chairman of the Federal Reserve to be.


Texas Gov. Rick Perry famously and indelicately attacked Bernanke earlier this week, at a campaign stop in Iowa. "If this guy prints more money between now and the election, I don't know what y'all would do to him in Iowa but we would treat him pretty ugly down in Texas. I mean, printing more money to play politics at this particular time in American history is almost treacherous, er, treasonous in my opinion," he said. Perry's comments attracted a lot of attention, but he is not the first 2012 GOP candidate to publicly criticize Bernanke. At a House Financial Services Subcommittee on Monetary Policy hearing in July, Texas Rep. Ron Paul argued with Bernanke on a number of points and criticized government bailouts of financial institutions. For better or worse, the man at the helm of U.S. monetary policy is now part of the 2012 presidential nomination storyline.

The 'heart attack proof' diet?

Woman trades heart surgery for new diet

STORY HIGHLIGHTS

• Dr. Caldwell Esselstyn Jr.'s diet has no meat, eggs, dairy or added oils
• CEO of American Heart Association says there are other key factors to consider
• Esselstyn says his diet works because it keeps the lining of the blood vessels free of plaque

Editor's note: Dr. Sanjay Gupta explores the signs, tests and lifestyle changes that could make cardiac problems a thing of the past on "The Last Heart Attack" at 8 p.m. ET Sunday on CNN.

(CNN) -- Dr. Caldwell Esselstyn Jr. didn't become a doctor to change the way America eats. He was a general surgeon.
But researching cancer, he stumbled on a fact that changed his career: Certain cultures around the world do not suffer from heart disease, the No. 1 killer in the Western world.
Esselstyn's practice took a dramatic turn -- from performing surgery to promoting nutrition. For more than 20 years, the Cleveland Clinic doctor has tried to get Americans to eat like the Papua New Guinea highlanders, rural Chinese, central Africans and the Tarahumara Indians of Mexico.
Follow his dietary prescription, the 77-year-old Esselstyn says, and you will be "heart attack proof" -- regardless of your family history.
"It's a foodborne illness, and we're never going to end the epidemic with stents, with bypasses, with the drugs, because none of it is treating causation of the illness," Esselstyn says.

Little evidence links mob violence to social media

Social media's role in the UK riots

STORY HIGHLIGHTS

• Term flash mob has become associated recently with sudden, violent group acts
  
• The phenomenon has spread to big cities in the U.S. and elsewhere
  
• Social-networking tools have taken the brunt of blame despite little evidence
• Many efforts to block social-media activity are unconstitutional, experts say

(CNN) -- This summer Cleveland Mayor Frank Jackson has wrestled with one of his biggest challenges since taking office five years ago.

Worried that flash mob violence would overrun city streets as it had elsewhere, the Cleveland City Council unanimously passed legislation that would criminalize the use of Facebook, Twitter and other social media for assembling unruly crowds or encouraging people to commit a crime.

But Jackson, after consulting with advisers, defied the council and vetoed the ordinance -- his first use of that power as mayor.

"It's very difficult to enforce something that's unconstitutional," Jackson said in an interview with CNN. "To make a criminal activity of just having a conversation, whether some acts of criminal activity are associated with it or not, it goes beyond reason."

knack for finding a message in a bottle

These are just two of the 40 bottles with messages inside that Clint Buffington has discovered.

STORY HIGHLIGHTS

• Since 2007, Clint Buffington has found 40 bottles with messages inside
• When Buffington's hunt for a message ends, his hunt for its sender begins
• The Turks and Caicos islands are a "flotsam magnet," where Buffington found his first bottle

(CNN) -- Your chances of finding a message in a bottle are about the same as your chances of finding a golden ticket in a Wonka bar. Most people would be astounded to find just one.
Clint Buffington has found 40.
The self-styled Message in a Bottle Hunter, Buffington chanced upon his first bottled message while hiking a beach in the Turks and Caicos in 2007. An "intense awareness that something very important was happening" seized him, then he saw an orange paper glinting inside a blue wine bottle.
Fresh off his fourth trip to the island chain, the teacher from Kentucky now has more whale mail than some have snail mail.
His oldest message was cast into the sea about a half-century ago. "Return it to 419 Ocean Boulevard (illegible) and resieve (sic) a reward of $150 from Tina, owner of Beachcomber," reads the note from the late owner of the Beachcomber Motel in Hampton Beach, New Hampshire. The owner had died, but her

Afghan shelter plan stokes controversy

A haven for Afghan women and kids

STORY HIGHLIGHTS

• An Afghan official says the shelters would be "better controlled" under Afghan law
• An activist says the "government is packed with misogynist warlords"
• One girl is in a shelter after her stepfather tried to rape her

Kabul, Afghanistan (CNN) -- Under the cover of darkness, a 9-year-old girl and her mother ran from their stone and mud home on the outskirts of Kabul. They feared the wrath of her stepfather.
"My father was beating me and my mother," said the girl, who to protect her identity will be referred to as simply Zarina. "He would insult my mother and sometimes wouldn't bring us food."
The last straw was an unwanted advance. Zarina, now age 10, said the man tried to rape her. She managed to slip past him and escape.
Zarina and her mother bounced from shelter to shelter before landing in a U.S.-funded women's home back in Kabul, the nation's capital.
Zarina's tale, however, is not unusual in Afghanistan, where women were persecuted under the Taliban regime from the mid-1990s until it was toppled in a U.S. invasion a couple of months after the al Qaeda terror network attacked the United States on September 11, 2001.