Lovely NYTimes column by Paul Krugman about the hysterical reaction of America’s financial and political elite to the Occupy Wall Street demonstrations.

What’s going on here? The answer, surely, is that Wall Street’s Masters of the Universe realize, deep down, how morally indefensible their position is. They’re not John Galt; they’re not even Steve Jobs. They’re people who got rich by peddling complex financial schemes that, far from delivering clear benefits to the American people, helped push us into a crisis whose aftereffects continue to blight the lives of tens of millions of their fellow citizens.

Yet they have paid no price. Their institutions were bailed out by taxpayers, with few strings attached. They continue to benefit from explicit and implicit federal guarantees — basically, they’re still in a game of heads they win, tails taxpayers lose. And they benefit from tax loopholes that in many cases have people with multimillion-dollar incomes paying lower rates than middle-class families.

This special treatment can’t bear close scrutiny — and therefore, as they see it, there must be no close scrutiny. Anyone who points out the obvious, no matter how calmly and moderately, must be demonized and driven from the stage. In fact, the more reasonable and moderate a critic sounds, the more urgently he or she must be demonized, hence the frantic sliming of Elizabeth Warren.

So who’s really being un-American here? Not the protesters, who are simply trying to get their voices heard. No, the real extremists here are America’s oligarchs, who want to suppress any criticism of the sources of their wealth.

Right on!

Interesting Telegraph Blog post by Ambrose Evans-Pritchard.

It has certainly been an electrifying few weeks.

I happened to be in the room with a group of Nobel economists in Lindau last month when German President Christian Wulff lashed out at Europe, accusing the ECB of violating its mandate and subverting the Lisbon Treaty.

“I regard the huge buy-up of bonds of individual states by the ECB as legally and politically questionable. Article 123 of the Treaty on the EU’s workings prohibits the ECB from directly purchasing debt instruments, in order to safeguard the central bank’s independence,” he said.

“This prohibition only makes sense if those responsible do not get around it by making substantial purchases on the secondary market,” he said.

Mr Wulff said Germany itself risks being engulfed by escalating debts. Who will “rescue the rescuers?” as the dominoes keep falling, he asked.

"Solidarity is the core of the European Idea, but it is a misunderstanding to measure solidarity in terms of willingness to act as guarantor or to incur shared debts.

"With whom would you be willing to take out a joint loan, or stand as guarantor? For your own children? Hopefully yes. For more distant relations it gets a bit more difficult."

More distant relations?

“All I heard was Germany, Germany, Germany. There was nothing about Europe. It was astonishing,” said Myron Scholes, the winner of the 1997 Nobel Prize.

Indeed it was. Fellow laureate Joe Stiglitz said that if President Wulff’s views reflected the outlook of the German government, monetary union would have collapsed already.

Well yes. Quite.

This chilling video is all over the Net. I’ve been watching the slow-motion car crash that is Western governments’ response to the economic downturn and thinking that it meets all the criteria for (ancient) Greek tragedy — in that one can see it’s going to be a disaster and nobody can do anything to prevent it. But I hadn’t seen anyone laying out as brutally as this.

Then some doubts set in. Is this guy a successful trader, as he implies? Here’s Deborah Orr in the Guardian:

Rastani isn’t a predator. He’s merely a would-be predator, operating freelance from his girlfriend’s semi in Bexleyheath, and regretful that he did not, in fact, make “a fortune” out of the crash. Actually, the guy is the most honest broker ever to hit the telly. No wonder he’s broke.

But here’s the funny thing. The BBC is in trouble because it let Rastani on to the television without vetting him properly first. He presented himself as a successful trader, when there is no sign that he is.

Quite so: according to the Telegraph, he lives in a pebbledashed suburban house that he doesn’t even own:

“They approached me,” he told The Telegraph. “I’m an attention seeker. That is the main reason I speak. That is the reason I agreed to go on the BBC. Trading is a like a hobby. It is not a business. I am a talker. I talk a lot. I love the whole idea of public speaking.”

So he’s more of a talker than a trader. A man who doesn’t own the house he lives in, but can sum up the financial crisis in just three minutes – a knack that escapes many financial commentators.

“I agreed to go on because I’m attention seeker,” he said on Tuesday. “But I meant every word I said.”

The trouble is that some of what he says is plausible. Goldman Sachs may not actually rule the world, but governments behave as if it did.

Thanks to Andrew Ingram for spotting it.

From Paul Krugman’s blog.

I was recently asked to give a talk on “capitalism and democracy”; that’s bigger-think than I usually do, but I gave it a try. I took as my starting point the famous Fukuyama thesis that liberal democracy — meaning basically a market economy plus democratic institutions — was an end state, a final resting point for state organization.

I always had my doubts about that, largely thanks to the 1930s: what we saw there was that a severe economic crisis could put liberal democracy very much at risk. And it was a close-run thing: slightly better strategic decisions by the bad guys could have made totalitarianism, not democracy, the end state.

It seemed to me even when Fukuyama first wrote that this could and probably would happen again, that there would be future crises that would put our system — which I agree is a very good system — at risk.

But one thing I was sure of was that the next great crisis would be different. It would be environmental, or about resource shortages, or about runaway technologies, or something; it wouldn’t be about a banking crisis and a collapse of aggregate demand, aggravated by bad monetary and fiscal policy. We’d learned to much to repeat that performance — right?

Wrong. The amazing thing now is not that we’re having a crisis, it’s the fact that we’re having the same crisis, and making the same mistakes.

Martin Wolf has a sobering column in today’s FT. This is how it begins:

Many ask whether high-income countries are at risk of a “double dip” recession. My answer is: no, because the first one did not end. The question is, rather, how much deeper and longer this recession or “contraction” might become. The point is that, by the second quarter of 2011, none of the six largest high-income economies had surpassed output levels reached before the crisis hit, in 2008. The US and Germany are close to their starting points, with France a little way behind. The UK, Italy and Japan are languishing far behind.

Further down, he has some pretty harsh things to say about Obama and Merkel. Thus:

The depth of the contraction and the weakness of the recovery are both result and cause of the ongoing economic fragility. They are a result, because excessive private sector debt interacts with weak asset prices, particularly of housing, to depress demand. They are a cause, because the weaker is the expected growth in demand, the smaller is the desire of companies to invest and the more subdued is the impulse to lend. This, then, is an economy that fails to achieve “escape velocity” and so is in danger of falling back to earth.

Now consider, against this background of continuing fragility, how people view the political scene. In neither the US nor the eurozone, does the politician supposedly in charge – Barack Obama, the US president, and Angela Merkel, Germany’s chancellor – appear to be much more than a bystander of unfolding events, as my colleague, Philip Stephens, recently noted. Both are – and, to a degree, operate as – outsiders. Mr Obama wishes to be president of a country that does not exist. In his fantasy US, politicians bury differences in bipartisan harmony. In fact, he faces an opposition that would prefer their country to fail than their president to succeed. Ms Merkel, similarly, seeks a non-existent middle way between the German desire for its partners to abide by its disciplines and their inability to do any such thing. The realisation that neither the US nor the eurozone can create conditions for a speedy restoration of growth – indeed the paralysing disagreements over what those conditions might be – is scary.

Yep.

Lovely Guardian column by Cory Doctorow.

The real story for me is about surveillance, and not the mere use of CCTV footage to apprehend rioters after the fact. It’s about the total failure of CCTV to deter people from committing crimes in the first place.

After all, that’s how we were sold on CCTV – not mere forensics after the fact, but deterrence. And although study after study has concluded that CCTVs don’t deter most crime (a famous San Francisco study showed that, at best, street crime shifted a few metres down the pavement when the CCTV went up), we’ve been told for years that we must all submit to being photographed all the time because it would keep the people around us from beating us, robbing us, burning our buildings and burglarising our homes.

In the realm of private residences, the conversation about the efficacy of surveillance takes a pertinent turn. The scrutiny extends to evaluating the practical impact of security technologies in deterring potential intruders and safeguarding homes. Amidst this ongoing dialogue, the role of House security cameras Adelaide becomes a focal point, introducing advanced features and capabilities into the broader discourse on the limitations and expectations associated with modern surveillance systems.

In the pursuit of bolstering residential security, residents in Brisbane can further augment their defenses by integrating Security Monitoring Brisbane solutions seamlessly into their existing infrastructure. This strategic integration enhances the efficacy of surveillance measures by providing continuous oversight and rapid response capabilities. Whether as a deterrent or a means of proactive surveillance, Security Monitoring serves as a cornerstone in safeguarding homes, offering unparalleled peace of mind to homeowners and their families.

A year before the Vancouver Winter Olympics, a reporter from a one of the local papers called me to ask whether I thought an aggressive plan to use CCTVs in the Gastown neighbourhood would help pacify the notorious high-crime heroin district. I said that the deterrence theory of CCTV relied on the idea that the deterred were making smart choices about their futures and would avoid crime if the consequences might catch up with them.

Then I recounted my last trip through Gastown, where the pavements were thronged with groaning and unconscious emaciated addicts, filthy and covered in weeping sores, and asked if those people could be reasonably characterised as “making smart choices about their future.” I explained how my hire car had been broken into by a thief who’d left four perfect fingerprints on the passenger window, not caring whether the crime was associated with her or his biometrics forever. Of course the CCTV fanatics will point to the successful use of the technology to identify looters. But that’s shifting the ground: the argument for CCTV is deterrence. It doesn’t work as advertised. In fact, it’s clearly most useful only if people are not deterred.