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A few well-written words can convey a wealth of information, particularly when there is no lag time between when they are written and when they are read. The IPS blog gives you an opportunity to hear directly from IPS scholars and staff on ideas large and small and for us to hear back from you.

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Entries tagged "Obama administration"

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What Drives U.S. Policy in Central America?

June 12, 2012 ·

Sanho Tree Al Jazeera The US Drug Enforcement Agency (DEA) has launched an investigation into a raid on a remote Honduran village that killed four people including two pregnant women. Four others were also injured in the operation in May.

In the waking hours of May 11, a group of indigenous villagers travelling by canoe in the Mosquita region came under helicopter fire. Four of them including two pregnant women and a child died. US officials said the killings followed a sighting of men unloading cocaine onto a truck nearby. The US State Department-owned helicopters were sent to investigate.

Read more, and watch the entire video, on Al Jazeera.

Top Democrats Push Obama on Capital Controls

May 29, 2012 ·

At a point in the election season when politicians of the same party tend to sweep their differences under the rug, two senior Democrats have sent a strong letter to the Obama administration on a subject unknown to most American voters.

Barney Frank and Sander Levin had strong words on capital controls for the Obama administration.This is the issue of capital controls -- various measures governments use to control volatile flows of money across their borders. Iceland, for example, used them to prevent massive capital flight in the midst of their meltdown. Other countries have used them to prevent speculative bubbles. In fact, governments that used capital controls during the 2008 crisis were among the least hard-hit, according to International Monetary Fund research.

However, despite their proven effectiveness in many cases, these policy tools are prohibited by U.S. trade and investment policies. Particularly in the wake of the worst financial crisis in 80 years, it's an embarrassingly outmoded position that only serves the narrow short-term interests of global financiers and corporations.

Thankfully, two top Democrats are not willing to just overlook the problem. In a letter to Treasury Secretary Timothy Geithner, Representatives Barney Frank and Sander Levin stated they could not support U.S. trade agreements unless the administration produces a "binding interpretation" of U.S. policy clarifying that governments would not be subject to investor lawsuits if they use this policy tool to manage financial volatility.

Frank is the ranking Member of the Financial Services Committee, while Levin is the leading Democrat on trade policy as the ranking Member of the Ways and Means Committee. They are part of a growing chorus calling for trade reforms to allow greater flexibility on capital controls. In fact, in their letter to Geithner, they cited a statement signed by more than 250 economists calling for such changes in U.S. policy.

The Frank-Levin letter comes at a key moment. In April, the Obama administration released a new model U.S. bilateral investment treaty. Despite strong calls for reform from public interest representatives on an official advisory body, the new model maintains the old language prohibiting capital controls, with no exceptions for times of financial crisis. Governments that violate such rules face the prospect of being sued by foreign investors in international tribunals.

The administration intends to use this new model as the template for bilateral investment treaties with China, India, and several other countries. It's also a strong indication of what they're seeking in ongoing negotiations over a Trans-Pacific Partnership, a trade agreement involving at least eight other governments.

By stepping up pressure from Congress, Frank and Levin may help alter the outcome of these negotiations. By showing that the views of U.S. officials are not monolithic, they may embolden negotiators from other countries who are seeking a more reasonable approach. Two of the governments involved in the Trans-Pacific talks, Singapore and Chile, sought exemptions for the use of capital controls to prevent crises when they negotiated bilateral trade agreements with the United States about a decade ago. At that time, the Bush administration refused to concede, beyond putting some modest limits on how much investors could demand in compensation for certain types of controls.

Today, we have the opportunity to apply lessons from a financial crisis caused by poorly controlled financial activities. And it's never been clearer that financial stability at home and abroad is essential for U.S. economic health. When our trading partners fall into financial crisis, we lose export markets and jobs. When hot money makes it impossible to control currency values, it hurts long-term investors and exporters and importers from the United States.

It's in all of our interest to support a fresh, flexible approach to capital controls.

U.S. Professors to Clinton: Respond to Boko Haram with Diplomacy, Development, and Demilitarization

May 22, 2012 ·

Reposted from Dr. Carl Levan's homepage.

Nigeria's National Security Advisor is visiting Washington, D.C. this week, and Secretary Clinton has been under pressure from Republicans in the House of Representatives to formally designate Boko Haram a Foreign Terrorist Organization (FTO).

The US-based academics, however, argue that formally labeling Boko Haram an FTO would "limit American policy options to those least likely to work." In particular, it would:

  1. Internationalize Boko Haram’s standing and enhance its status among radical organizations elsewhere.
  2. Give disproportionate attention to counter-terrorism in bilateral relations at a time when economic ties are expanding and a robust multi-faceted relationship has emerged.
  3. Undermine Nigeria’s progress on the rule of law in two ways: First, by effectively legitimizing abuses by security services that Human Rights Watch and other organizations have drawn attention to as urgent, ongoing problems. Second, President Goodluck Jonathan is pushing the National Assembly for Martial Law. Historically, such measures have been followed by broader political instability.
  4. Impede humanitarian assistance and possibly independent academic research.

I was one of the letter’s initiators, along with Peter Lewis from SAIS and Jean Herskovits from SUNY – Purchase.  I will be giving a brief talk on Boko Haram at a conference sponsored by the Jamestown Foundation at the Carnegie Endowment for International Peace on Tuesday, June 19, in Washington, DC. 

To see a full version of the letter, with details on each point we made to the Secretary of State, click here (pdf).

Populism and Pain in Obama's 2013 Budget Proposal

February 14, 2012 ·

Mitt Romney said it this way:

"I'm not concerned about the very poor. We have a safety net there. If it needs a repair, I'll fix it. I'm not concerned about the very rich, they are fine....I'm concerned about the very heart of America."

President Barack Obama said it this way:

"We can restore an economy where everybody gets a fair shot, everybody does their fair share, everybody plays by the same set of rules — from Washington to Wall Street to Main Street. That’s the America we believe in."


Both want to appeal to a hurting middle-class electorate. Only one has a populist message with appeal and effect. He most likely will win re-election in 2012.

President Obama wants to align himself as a champion of the Middle Class. Photo by Chrysler Group.Obama's $3.8 trillion 2013 budget proposal, with its 10-year outlook, is by design a populist campaign tool. Though not politically viable now, his newly released budget is critically important in this election year both for the values it reflects, the vision it promotes and the potential it promises.

Obama's budget has a populist tone, appeals to the middle class, and has some good proposals, both on investment and revenue-raising. But it also reflects the strict spending caps mandated this past summer by the Budget Control Act and hits some struggling families hard. It doesn't go nearly far enough in revenue-raising. For instance, it does't propose a tax on financial transactions that would curb Wall Street's worst speculation or propose significant corporate tax reform that would actually raise needed funds. And, by reducing non-security discretionary spending from its current 3.1 percent of GDP to a 50-year low of 1.7 percent over the next decade, a lot of pain will set in when the populism starts to wears off.

Let's start with the good. Among the good proposals on investment side:

  • The extension of the payroll tax cut and unemployment benefits through the end of 2012.
  • School modernization and plans to retain teachers and first responders.
  • Project Rebuild which helps to match unemployed in distressed communities with those communities'  infrastructure needs.
  • A small business tax credit that incentivizes new hiring.
  • Increased child care funding.
  • Improvements in Earned Income Tax Credit and Child Tax Credit.
  • Tax incentives for manufacturers that keep and create jobs here in the United States.
  • A National Infrastructure Bank that would fund projects that increase sustainable transportation and infrastructure investment.
  • A total of $850 million in Race to the Top education proposals intended to improve the quality of education from early childhood through higher education.
  • Efforts to make college more affordable through sustaining Pell grant funding, keeping interest on student loans from increasing, and reining in tuition hikes.
  • A 7 percent increasing in new biomedical research grants.
  • Support for a more sustainable economy through goals of increasing electric car production, doubling the share of "clean energy" electricity sources, and reducing the energy consumed by buildings by 20 percent by 2020.

And, among good proposals on the revenue side:

  • Support sustainable energy and environment innovations by eliminating 12 tax breaks to the oil, gas, and coal industries by $41 billion over the next 10 years.
  • Spend $487 billion less on the military over the coming decade.
  • Make the "Buffet Rule" law, ensuring that millionaires pay a 30  percent tax rate on un-earned income.
  • Let the Bush Era tax cuts for families making over $250,000 a year expire.

On to the bad. Here are some aspects of Obama's proposed budget that aren't as good as they might first seem:

  • According to the Citizen's For Tax Justice, although the Obama plan proposes revenues from letting Bush era tax cuts expire for couples making over $250,000, it makes permanent 78 percent of the Bush tax cuts at a cost of $3.4 trillion over the next 10 years.
  • Obama's proposal to replace the Alternative Minimum Tax with the "Buffet Rule" may not produce any new revenue at all.
  • Details remain undisclosed about corporate tax reform proposals, but Obama has suggested they will be revenue-neutral. How is that a good thing?
  • Even with this modest reduction in Pentagon spending, Obama's budget proposal still leaves an extreme imbalance between military and non-military spending.

Now, for the Ugly: Last year's Budget Control Act mandated $1 trillion in discretionary cuts. Much of that must come from programs that low-income people rely on for critical human needs. After a hard year of cuts in 2011, this budget proposal calls for a devastating 14 percent cut in social spending. Here are some examples where cuts occur:

  • Health care services, career opportunities programs for low-income people.
  • Children's mental health services.
  • Housing for disabled people.
  • Housing for people with HIV/AIDS.
  • Rental Assistance benefits for low-income people.
  • Home heating assistance for low-income people.
  • Community Development Block Grants which help to fund critical human need services.
  • Programs in the Environmental Protection Agency.
  • Programs in the National Park Service.

This budget proposal will appeal to the middle class and puts Obama in a more popular position than Romney as the 2012 presidential election season heats up. But while this budget has the populist thrust of cutting long-term deficit and debt by attempting to balance spending cuts and revenue increases, it falls short. It bolsters some needed programs, but unnecessarily defunds others. By not calling for all of the Bush era tax cuts to expire, not calling on Wall Street to pay its fair share through enacting a small levy on speculative financial transactions, not cutting military base and war spending deeply enough and not calling for the kind of corporate tax reform that will produce revenue, Obama is letting the 1 percent off rather easy, while the rest of us, especially the poor, shoulder  the pain.

The Sick Man of North America

January 31, 2012 ·

A century ago, the Ottoman Empire was falling apart as a result of disastrous wars and economic decline. Dubbed “the sick man of Europe,” the Ottoman Empire was not ultimately able to pull itself together. It expired in the flames of World War I, but not before pulling down a good chunk of the world order with it.

Sick Uncle SamToday, the United States faces considerable economic challenges and has suffered numerous setbacks because of our own disastrous wars. Our reputation in the international community remains quite low. We are coming dangerously close to earning the epithet of “the sick man of North America.” And our decline in health also threatens global stability and security.

Every week for the last six years, I’ve written a column called World Beat about the health of U.S. foreign policy. With a few exceptions – the recent overture to Burma, the withdrawal of U.S. troops from Iraq – the diagnosis has been dismal. For the first couple years, I chronicled the insanities of the Bush administration. For the last three years, I’ve dissected the policies of the Obama administration. There has been, alas, more continuity between the two administrations than anyone predicted when Barack Obama took office.

I had low expectations for Obama from the beginning – not because I doubt his talents as an individual, but because I fear for the health of our political institutions and I recognize the power of our economic elite. Obama lacks the leadership skills, the political intention, and the congressional backing to transform institutions and challenge entrenched economic power. U.S. foreign policy remains on the same perilous trajectory that Bush and his cronies launched it on. And so we are still the sick man of North America, dangerous in our relative decline.

Cover art by Adwoa Masozi.In All Over the Map: the Best of World Beat, I’ve brought together a collection of the best of these columns. This modestly priced ebook covers the worsening health of U.S. foreign policy and the efforts to revive the patient. It looks at movements around the world that champion peace, democracy, and economic sustainability. It profiles the people and the ideas that can guide us out of our perilous predicament. The book includes essays on the death of Osama bin Laden, the continuing U.S. drone wars, graphic novels that cover global affairs, the use of dance therapy with child soldiers, the dissident art of Ai Weiwei, the politics of the Muslim Brotherhood, the politics of overseas adoption, eyewitness reports from Korea and Albania, and much much more.

Hope was the watchword of the 2008 elections, and it propelled Obama into office. We must still hope. Quoting a famous African proverb, Hillary Clinton is fond of saying that “it takes a village to raise a child.” Similarly, it takes an electorate to raise a president. We can still push Obama – and subsequent presidents – in the direction of democracy, equitable prosperity, and environmental sustainability. We can still push the international community toward these goals. All Over the Map is a guide to the vital signs of the United States and the world as well as the methods to improve our chances of recovery.

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