Here's Paul Krugman's first comments on his blog post-debate:

"I responded that I am not a defender of the economic policies of the Emperor Diocletian."

Here's Krugman's second set of comments:

Think about it: you approach what is, in the end, a somewhat technical subject in a format in which no data can be presented, in which there's no opportunity to check facts (everything Paul said about growth after World War II was wrong, but who will ever call him on it?). So people react based on their prejudices. If Ron Paul got on TV and said "Gah gah goo goo debasement! theft!" -- which is a rough summary of what he actually did say -- his supporters would say that he won the debate hands down; I don't think my supporters are quite the same, but opinions may differ.

And finally, here's Kevin Drum on the whole spectacle:

Krugman is right, but I think he's also missing the point here. Wars of ideas are typically won in print: in journals, in books, in magazine articles, and in monographs. The audience is fellow professionals in your field, the language is often technical and abstruse, and you keep score by counting citations, being invited to conferences, and amassing disciples.

Public debates, including their gruesome modern variant, the three-minute hit on cable TV, aren't about that. They're solely designed to influence public opinion, and you keep score at the ballot box. Nobody cares if Ron Paul is technically right about the Romans debasing their currency, and nobody cares whether that really has anything to do with the modern global economy. All that matters is whether he's found an analogy that moves a few of the rubes to his side. Truth isn't just an obstacle in public debates, it's a handicap.

If you want to increase your understanding of a subject, public debates are worthless. But that's because that isn't their purpose. Their purpose is emotional appeal, and understanding actively gets in the way of that. Ron Paul already knows that. I hope Krugman does too.

Yes, most debates are worthless with respect to getting to the meat of the issues; and yet sometimes, just sometimes, especially during Presidential debates, we get morsels of facts that leap out at us and shape our views. That's why we keep having them.

Plus, we can't help ourselves -- we must constantly communicate and debate. Let's face it: we're plain and simple nothing more than social animals.

The projects in this year's Congressional Pig Book Summary symbolize the most blatant examples of pork spending by the Federal Government. As in previous years, all the items in the Congressional Pig Book meet at least one of Citizens Against Government Waste's seven criteria, but most satisfy at least two:

** Requested by only one chamber of Congress;
** Not specifically authorized;
** Not competitively awarded;
** Not requested by the President;
** Greatly exceeds the President’s budget request or the previous year’s funding;
** Not the subject of congressional hearings; or
** Serves only a local or special interest.

Citizens Against Government Waste (CAGW) is a private, non-partisan, non-profit organization representing more than one million members and supporters nationwide. CAGW's mission is to eliminate waste, mismanagement, and inefficiency in the federal government.

You'll note that although on paper there's been a massive reduction in earmarks in 2012, there are still plenty that have been written into law; our Representatives just took their names off the legislation. CAGW had to root around for many of them, but one of the biggest has been out there in plain site:

$255,000,000 for continued upgrade of the M1 Abrams tank to the M1A2SEP variant, despite DOD's proposal to suspend tank production until 2017 in order to achieve savings. According to a December 16, 2011, article in the Daily Tribune, supporters of the upgrade warned that "idling the program as the Iraq and Afghanistan wars wind down would jeopardize tens of thousands of jobs at more than 560 businesses across the nation."

And isn't that something? The Defense Department doesn't want us to spend $250 million on the tank, but our representatives want to ram it through anyway, since it's really nothing but a jobs bill.

Angry Christie should be impeached for this:

"The governor subsequently steered $4 billion earmarked for the tunnel to the state's near-bankrupt transportation trust fund, traditionally financed by the gasoline tax. "

Why?

"The report is likely to revive criticism that his decision, which he said was about "hard choices" in tough economic times, was more about avoiding the need to raise the state’s gasoline tax, which would have violated a campaign promise."

They should impeach him; there's no bigger transportation project as important in this country as the one Christie torpedoed.

Paul Krugman seems to agree, as his column today (4/13/12) lays out:

Mr. Christie insisted that his state couldn't afford the cost. As we've already seen, however, he apparently couldn't make that case without being dishonest about the numbers. So what was his real motive?

One answer is that the governor is widely assumed to have national ambitions, and the Republican base hates government spending in general (unless it's on weapons). And it hates public transportation in particular. Indeed, three other Republican governors -- in Florida, Ohio and Wisconsin -- have also canceled public transportation projects supported by federal funds. The difference, of course, is that New Jersey is a densely populated state, most of whose residents live either in Greater New York or Greater Philadelphia; given that position, public transit is the state’s lifeblood, and refusing to invest in such transportation will strangle the state's economy.

Another answer is that canceling the tunnel allowed Mr. Christie to divert funds from that project -- as his critics have said, to cannibalize the investment -- and put them into the state highway fund, thereby avoiding the need to raise the state's tax on gasoline. New Jersey gas taxes, by the way, are lower in real terms than at any point in the state's history. But, as a candidate, Mr. Christie said that he wouldn't raise those taxes, so cannibalizing the tunnel helped him avoid embarrassment.

The crucial point about both of these explanations is that they stand Mr. Christie's narrative about himself on its head. The governor poses as a man willing to make hard choices for the future, but what he actually did was sacrifice the future for the sake of personal political advantage. He catered to national Republican prejudices that are completely at odds with New Jersey's needs; he cared more about avoiding embarrassment over a misguided campaign pledge than about serving an urgent public need.

Unfortunately, Mr. Christie's behavior is all too typical these days.

America used to be a country that thought big about the future. Major public projects, from the Erie Canal to the interstate highway system, used to be a well-understood component of our national greatness. Nowadays, however, the only big projects politicians are willing to undertake -- with expense no object -- seem to be wars. Funny how that works.

The thing is, because so much of our transportation future is at stake, its just not that funny that the voters of New Jersey picked Christie in the first place. All of our future generations are going to suffer for it.

In a new report released this week, the Congressional Budget Office (CBO) trimmed how much it expected the Troubled Asset Relief Program (TARP) would eventually cost taxpayers. It now expects that when all is said and done, the program will cost $32 billion, down $2 billion from its December estimate.

That projection is rosier than even the White House's. The Office of Management and Budget (OMB) currently pegs the cost of the bailout at $68 billion, driven largely by greater expectations about the costs of the government's housing relief programs — OMB estimates $30 billion more than does the CBO on how much will be spent on those programs.

CBO attributed its reduction to the fact that the government's remaining $50 billion investment in American International Group (AIG) had gained value.

The $85 billion bailout of AIG was by far the most egregious of all the bailouts, and you can read the skinny on that travesty here. At least the CBO thinks that it's not going to cost us $85 billion in the end. Is that true, though? At least we have this windfall:

While TARP is most often decried as a bailout to big banks, the portion of the program that actually targeted financial institutions is reaping a windfall for the government. After buying up $205 billion in stock from roughly 800 financial institutions during the crisis, as well as throwing another $40 billion just at bank titans Citigroup and Bank of America, the CBO estimates the government will turn a $25 billion profit on that portion.

And while we're at it, let's look at the costs of the other bailouts, shall we?

But strictly from the perspective of dollars and cents, the CBO expects the auto bailout to cost taxpayers roughly $19 billion. General Motors and Chrysler have already paid off $35 billion in government aid, but $37 billion remains outstanding. The government has already written off $7 billion in its effort to keep the industry afloat.

When TARP was crafted, $75 billion was set aside to help struggling homeowners modify their mortgages. Those efforts have came up short, with just $3 billion outstanding. The CBO estimates another $13 billion will go out the door under the program, and since those funds were never expected to be paid back, will end up costing the government $16 billion.

When will it end? When will it end...?

Their commentary is spot on, as well:

Data from the Bureau of Economic Analysis illustrates a key difference between Reagan's first term and Obama's: the pliancy of the Congresses they had to work with. Despite the fact that it was controlled by Democrats, Reagan's Congress was ultimately accommodative, and the result was significant fiscal expansion, which likely helped bring down the unemployment rate.

Despite presiding over a Democratic Congress, Obama enjoyed no such co-operation. Serial GOP filibusters limited the extent to which he could use deficit spending and temporary tax cuts to hasten economic recovery. Republicans bucked historically bipartisan policies to thwart the president. And when they took over the House in 2011, Republicans pursued an austerity agenda, and, separately, spooked credit markets by taking the government to the brink of default. All of these factors, combined with contraction at the state and local levels, offset the stimulative policies Obama secured at the beginning of his term. And that prefigured a significantly slower labor market recovery than Reagan enjoyed.

That's not purely a function of GOP obstructionism. Obama and Reagan pursued different policies, and Reagan's were politically more difficult for Congress to thwart. But today's GOP, unlike yesterday's Democratic Party, pursued a purposeful and unprecedented strategy of blanket obstruction designed to damage the president. And these are the results.

Indeed, this is what Obama has had to face ever since he took office, starting with Minority Leader, Mitch McConnell's comment from 2009:

MCCONNELL: We need to be honest with the public. This election is about them, not us. And we need to treat this election as the first step in retaking the government. We need to say to everyone on Election Day, "Those of you who helped make this a good day, you need to go out and help us finish the job."

NATIONAL JOURNAL: What's the job?

MCCONNELL: The single most important thing we want to achieve is for President Obama to be a one-term president.

This is what the political pundits thought about that remark at the time.

Against this intractable desire to defeat Obama instead of helping the economy, no wonder this election is going to be razor thin close.

Procter & Gamble Co.'s failure to raise the price of Cascade dishwashing soap shows why investors are buying Treasuries at the lowest yields in history, giving the Federal Reserve more scope to boost the economy.

The world's largest consumer-products company rolled back prices after an 8 percent increase lost the firm 7 percentage points of market share. Kimberly-Clark Corp. started offering coupons on Huggies after resistance to the diapers' cost. Darden Restaurants Inc. (DRI) raised prices at less than the inflation rate as patrons order more of Olive Garden's discounted stuffed rigatoni than it anticipated.

Low inflation has continued to boost demand for Treasuries, keeping rates low as President Barack Obama finances a $1.1 trillion budget deficit to boost an economy still growing at rates below the 20-year average. The Fed set an annual inflation target of 2 percent two weeks ago, and policy makers suggested they may conduct a third round of bond purchases under a policy known as quantitative easing.

"Any way you look at it, the Treasury market is still expecting rather benign inflation, and we will be in a low-rate environment for some time," David Ader, head of U.S. government bond strategy at CRT Capital Group LLC in Stamford, Connecticut, said Feb. 1 in a telephone interview.

"This recovery has not been a great recovery with regard to income gains, and income gains are a function of both growth in wages and jobs," Jeffrey Rosenberg, the chief investment strategist for fixed-income at BlackRock Inc., the world's biggest money manager, said in a Feb. 1 interview in New York. "Why can't you pass price increases through to consumers? It's because consumers aren't seeing income gains."

Where's all the hyperinflation conservative economists are so afraid of and why are they so hyper-anti-keynsian?

Freddie Mac, the taxpayer-owned mortgage giant, has placed multibillion-dollar bets that pay off if homeowners stay trapped in expensive mortgages with interest rates well above current rates.

Freddie began increasing these bets dramatically in late 2010, the same time that the company was making it harder for homeowners to get out of such high-interest mortgages.

What makes this story particularly galling is the following:

Freddie Mac, along with its cousin Fannie Mae, was bailed out in 2008 and is now owned by taxpayers. The companies play a pivotal role in the mortgage business because they insure most home loans in the United States, making banks likelier to lend. The companies’ rules determine whether homeowners can get loans and on what terms.

In addition to being an instrument of government policy dedicated to making home loans more accessible, Freddie also has giant investment portfolios and could lose substantial amounts of money if too many borrowers refinance.

Hence, the seeming need to hedge their portfolio by placing bets against the very homeowners they're supposed to be supporting!

Freddie Mac's trades, while perfectly legal, came during a period when the company was supposed to be reducing its investment portfolio, according to the terms of its government takeover agreement. But these trades escalate the risk of its portfolio, because the securities Freddie has purchased are volatile and hard to sell, mortgage securities experts say.

"We were actually shocked they did this," says Scott Simon, who as the head of the giant bond fund PIMCO's mortgage-backed securities team is one of the world's biggest mortgage bond traders. "It seemed so out of line with their mission."

The trades "put them squarely against the homeowner," he says.

"More than three years into the government takeover, we have Freddie Mac pursuing highly levered, complicated transactions seemingly with the purpose of trading against homeowners," says Columbia University real-estate economist, Christopher Mayer. "These are the kinds of things that got us into trouble in the first place."

But why would they make these risky trades? Hmmm....could it be this?

Even though Freddie is a ward of the state, top executives are highly compensated. Peter Federico, who's in charge of the company's investment portfolio, made $2.5 million in 2010, and he had target compensation of $2.6 million for last year, when most of these leveraged investments were made.

Ring the bell! These executives are raking it in at the expense of homeowners trapped in high interest rate loans, who can't re-finance these loans at a lower rate because Freddie Mac won't let them!

It's disgusting and outrageous, although apparently The Fed tried to do something about this last year:

In a recent white paper on remedies for the stalled housing market, the Federal Reserve criticized Fannie and Freddie for the fees they have charged for refinancing. Such fees are "another possible reason for low rates of refinancing" and are "difficult to justify," the Fed wrote.

A former Freddie employee, who spoke on condition he not be named, was even blunter: "Generally, it makes no sense whatsoever" for Freddie "to restrict refinancing" from expensive loans to ones borrowers can more easily pay, since the company remains on the hook if homeowners default.

One last question would be: where's the government oversite?

The Federal Housing Finance Agency (FHFA) effectively serves as Freddie's board of directors and is ultimately responsible for Freddie's decisions. It is run by acting director Edward DeMarco, who cannot be fired by the president except in extraordinary circumstances.

The trades raise questions about the FHFA’s oversight of Fannie and Freddie. But the FHFA is not just a regulator. With the two companies in government conservatorship, the FHFA now plays the role of their board of directors and shareholders, responsible for the companies’ major decisions.

Under acting director DeMarco, the FHFA has emphasized that its main goal is to limit taxpayer losses by managing the two companies’ giant investment portfolios to make profits. To cover their previous losses and ongoing operations, Fannie and Freddie already had received $169 billion from taxpayers through the third quarter of last year.

The FHFA has frustrated the administration because the agency has made preserving the value of the companies’ investment portfolios a priority over helping homeowners in expensive mortgages. In 2010, President Barack Obama nominated a permanent replacement for acting director DeMarco, but Republicans in Congress blocked him. Obama has not nominated anyone else to replace DeMarco.

And why did the Republicans block his replacement? Hopefully we'll find out in the next installment.

In the meantime, check out the story for all the gory details on the trades Freddie Mac made. It's a pretty astonishing story, indeed.

As the housing bubble entered its waning hours in 2006, top Federal Reserve officials marveled at the desperate antics of home builders seeking to lure buyers.

The officials laughed about the cars that builders were offering as signing bonuses, and about efforts to make empty homes look occupied. They joked about one builder who said that inventory was "rising through the roof."

But the officials, meeting every six weeks to discuss the health of the nation's economy, gave little credence to the possibility that the faltering housing market would weigh on the broader economy, according to transcripts that the Fed released Thursday. Instead they continued to tell one another throughout 2006 that the greatest danger was inflation -- the possibility that the economy would grow too fast.

"We think the fundamentals of the expansion going forward still look good," Timothy F. Geithner, then president of the Federal Reserve Bank of New York, told his colleagues when they gathered in Washington in December 2006.

Some officials, including Susan Bies, a Fed governor, suggested that a housing downturn actually could bolster the economy by redirecting money to other kinds of investments.

Yet the most egregious part of this story is that many of the same folks are still in positions of power and pontificating that all's well on the economic front. Hello, Tim Geithner!

Krugman's got something to say about this, as well:

Two puzzling things: first, the housing bubble was the clearest thing I've ever seen in my professional life. How could they ignore even the possibility of a severe bust?

Second, some of the same people you read in these transcripts dismissing risks to the real economy and worrying wrongly about inflation are still making policy pronouncements, in which they … dismiss risks to the real economy and worry wrongly about inflation.

You should be scared...very...very ...scared.

"The boom, not the slump, is the right time for austerity at the Treasury." So declared John Maynard Keynes in 1937, even as F.D.R. was about to prove him right by trying to balance the budget too soon, sending the United States economy -- which had been steadily recovering up to that point -- into a severe recession. Slashing government spending in a depressed economy depresses the economy further; austerity should wait until a strong recovery is well under way.

Unfortunately, in late 2010 and early 2011, politicians and policy makers in much of the Western world believed that they knew better, that we should focus on deficits, not jobs, even though our economies had barely begun to recover from the slump that followed the financial crisis. And by acting on that anti-Keynesian belief, they ended up proving Keynes right all over again.

Indeed they have. At the expense of all of us.

This sums it all up:

We entered 2011 amid dire warnings about a Greek-style debt crisis that would happen as soon as the Federal Reserve stopped buying bonds, or the rating agencies ended our triple-A status, or the superdupercommittee failed to reach a deal, or something. But the Fed ended its bond-purchase program in June; Standard & Poor's downgraded America in August; the supercommittee deadlocked in November; and U.S. borrowing costs just kept falling. In fact, at this point, inflation-protected U.S. bonds pay negative interest: investors are willing to pay America to hold their money.

Why are we even discussing whether Keynes is correct or not? The evidence is irrefutable.

Four months after Standard & Poor's stripped the U.S. of its AAA credit rating and said the world's biggest economy was no longer the safest of borrowers, dollar- denominated financial assets are doing nothing but appreciating.

Government bonds have returned 4.4 percent, the dollar has gained 8.7 percent relative to a basket of currencies, and the S&P 500 Index of stocks has rallied 1.7 percent since the U.S. was cut to AA+ from AAA on Aug. 5. The cost for the nation to borrow has fallen to record lows since S&P said the U.S. was no longer risk-free, with the average monthly yield in November on 10-year notes below 2 percent for the first time since 1950.

How's that for a big fat DOH!

For nearly a decade, Ms. Schultz and her colleagues have been rooting through the minutiae of accounting regulations, government filings and corporate retirement plans to expose how many of the largest American companies have systematically plundered their employees pension funds, at once robbing their workers of hard-won benefits and enriching their own profits. Her work has led to Congressional hearings, to a Washington investigation or two and to numerous journalism awards.

Now, inevitably, comes the book. In "Retirement Heist: How Companies Plunder and Profit From the Nest Eggs of American Workers." Ms. Schultz herds all her journalistic cattle into a single corral, laying out by what any measure is a damning indictment of the broken pension promises too many American corporations have made to their workers.

The following goodies are detailed as Ms. Schultz reveals how companies:

* Siphon billions of dollars from their pension plans to finance downsizings and sell the assets in merger deals * Overstate the burden of rank-and-file retiree obligations to justify benefits cuts while simultaneously using the savings to inflate executive pay and pensions * Hide their growing executive pension liabilities, which at some companies now exceed the liabilities for the regular pension plans * Purchase billions of dollars of life insurance on workers and use the policies as informal executive pension funds. When the insured workers and retirees die, the company collects tax-free death benefits *Preemptively sue retirees after cutting retiree health benefits and use other legal strategies to erode their legal protections.

Just a little holiday reading for your upcoming vacation!

Saturday November 5th was Bank Transfer Day, the day on which Americans were urged to switch their accounts from the big banks to credit unions. For a grassroots movement started by art gallery owner Kristen Christian on Facebook, it garnered a lot of media attention.

It also spurred activists from #OccupyWallStreet to take to the streets across the country:

But how effective was it?

On Tuesday, the Credit Union National Association (CUNA) said that more than 40,000 people joined credit unions on Bank Transfer Day itself, bringing with them $80 million in assets. One credit union in Georgia reported a 60-percent jump in new accounts on Nov. 5.

And last week the CUNA released figures that an estimated 650,000 people had joined credit unions since Sept. 29 (the day Bank of America unveiled its now-rescinded $5 monthly debit card fee) compared to only 80,000 people on a normal month and more than the total of all people who switched in 2010, and had added an estimated $4.5 billion to new savings accounts at credit unions, both from new and existing members. ABC recently released a report which called the mass migration a "bank revolt," emphasizing the seriousness of the movement and the public awareness it has bred.

There are numerous online tools to help you make the switch. Start here at Institutional Risk Analytics' "Move Your Money" tool. Then go over here at aSmarterChoice.org to locate a credit union near you.

Or better yet, just go to MoveYourMoney's Credit Union finder:

http://moveyourmoneyproject.org/find-bankcredit-union

Finally, support the movement by visiting the "Move Your Money" project after you watch the following video...then Move Your Money!:

After-tax income for the highest-income households grew more than it did for any other group. (After-tax income is income after federal taxes have been deducted and government transfers—which are payments to people through such programs as Social Security and Unemployment Insurance—have been added.)

CBO finds that, between 1979 and 2007, income grew by:

** 275 percent for the top 1 percent of households,
** 65 percent for the next 19 percent,
** Just under 40 percent for the next 60 percent, and
** 18 percent for the bottom 20 percent.

This chart says it all:

And these statistics are particularly troublesome:

The share of income going to higher-income households rose, while the share going to lower-income households fell.

** The top fifth of the population saw a 10-percentage-point increase in their share of after-tax income.
** Most of that growth went to the top 1 percent of the population.
** All other groups saw their shares decline by 2 to 3 percentage points.

You can read this very important study in .pdf form here: "Trends in the Distribution of Household Income between 1979 and 2007"

NextBillion.net is a website and blog bringing together the community of business leaders, social entrepreneurs, NGOs, policy makers and academics who want to explore the connection between development and enterprise. It is a discussion forum, networking space and knowledge base for individuals and organizations interested in the "next billion". Our goal is to highlight the development and implementation of business strategies that open opportunities and improve the lives of the world's approximately 4 billion low-income producers and consumers.

While development aid and political reform are essential components in poverty eradication, equally important are business models that engage low-income communities as producers and consumers in their own robust economies. Successful business models - inherently versatile, innovative, and driven by the profit motive - can sometimes tackle development challenges more quickly and effectively than government and aid mechanisms. Innovative models that bring together the objectives of business and development to create sustainable, market-oriented approaches are the focus of NextBillion.net.

Make sure to visit NextBillion.net on a regular basis!

** The poverty rate in 2010 was the highest since 1993 but was 7.3 percentage points lower than the poverty rate in 1959, the first year for which poverty estimates are available. Since 2007, the poverty rate has increased by 2.6 percentage points.

** In 2010, the family poverty rate and the number of families in poverty were 11.7 percent and 9.2 million, respectively, up from 11.1 percent and 8.8 million in 2009.

** The poverty rate and the number in poverty increased for both married-couple families (6.2 percent and 3.6 million in 2010 from 5.8 percent and 3.4 million in 2009) and female-householder-with-no-husband-present families (31.6 percent and 4.7 million in 2010 from 29.9 percent and 4.4 million in 2009).

At what does it take to be classified as living in poverty?

As defined by the Office of Management and Budget and updated for inflation using the Consumer Price Index, the weighted average poverty threshold for a family of four in 2010 was $22,314.

The fact of the matter is, though, that poverty has been rising in America for much of the past decade, as the following chart illustrates:

It's very clear that the number of Americans in poverty increases under Republican presidents dating back to Ronald Reagan. Is that a coincidence?