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The New Print Edition of CounterPunch, Only for Our Newsletter Subscribers! How Cops Extort Confessions;
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The New Print Edition of CounterPunch, Only for Our Newsletter Subscribers!
How Cops Extort Confessions;
How the U.S. “Justice System” Really WorksNinety-two per cent of felony convictions in the U.S. are obtained by plea bargains or confessions. Without them the “justice system” would grind to a halt. In an important piece in our latest newsletter, available only to subscribers, Emily Horowitz shows how totally innocent people will “confess” under police pressure, even without physical torture. Horowitz outlines the powerful case for banning confessions altogether. Also in this new edition Marcus Rediker, co-author of the legendary The Many Headed Hydra, writes of popular heroism and resistance in the favelas of Medellin, Colombia. Alexander Cockburn reports on how America’s oldest bank, patronized by the global elites, washed billions smuggled out of Russia, and how the Russians might win their money back, shaking the world’s banking system if they do so. Serge Halimi describes the real battle for the soul of Europe. Get your copy today by subscribing online or calling 1-800-840-3683 Contributions to CounterPunch are tax-deductible. Click here to make a donation. If you find our site useful please: Subscribe Now! CounterPunch books and gear make great presents.
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Today's Stories August 22, 2008 Peter Morici August 21, 2008 Allan J. Lichtman Dave Lindorff Loserville: How Obama Blew It Ralph Nader Joanne Mariner Wajahat Ali Ron Jacobs Rostam Purzal Anthony Papa Website of the Day August 20, 2008 Michael Neumann Ray McGovern Eric Walberg Fidaa Abed Daniel Haack Mike Whitney Website of the Day August 19, 2008 Paul Craig Roberts Deepak Tripathi Marwan Bishara Saul Landau William S. Lind Martha Rosenberg James Brittain Pratyush Chandra David Macaray Website of the Day August 18, 2008 Tariq Ali Gary Leupp Uri Avnery John Ross Farooq Sulehria Luis Rodriguez Manuel Garcia, Jr. Noah Baker Merrill Charles Thomson Website of the Day August 16 / 17, 2008 Alexander Cockburn Jeffrey St. Clair Deepak Tripathi Conn Hallinan Mike Whitney Robert Fantina Ray McGovern Nicole Colson Fatima Bhutto Jean-Luis Rocca David Michael Green Ramzi Kysia Dave Lindorff Lisa Martinovic Richard Rhames Don Santina Rannie Amiri Ramzy Baroud John Stanton Howard Lisnoff Ron Jacobs Seth Sandronsky Poets' Basement Website of the Weekend
August 15, 2008 Steve Niva David Remington Michael Winship Paul Craig Roberts Farzana Versey Harvey Wasserman Felice Pace Julian Critchley Website of the Day August 14, 2008 Saul Landau / Conn Hallinan Mike Whitney Reza Fiyouzat Ralph Nader Christopher Brauchli The Cheerleader in China Jack Bradigan Spula Patrick Irelan John Walsh Dan Bacher Website of the Day
August 13, 2008 Paul Craig Roberts David Remington Brian Cloughley Glen Ford Brendan Cooney Dave Lindorff Tom Lewis Stan Cox Alan Farago Martha Rosenberg Website of the Day August 12, 2008 Uri Avnery Anthony DiMaggio Bill Christison Eric Walberg Kate Connolly Diane Farsetta Peter Morici Thom Rutledge Lee Patton Niranjan Ramakrishnan Website of the Day August 11, 2008 Ishmael Reed Paul Craig Roberts Gary Leupp Douglas Kammen William Willers Greg Moses Jeff Leys Cynthia McKinney Alan Farago Website of the Day August 9 / 10, 2008 Alexander Cockburn Jeffrey St. Clair Bruce Jackson Kevin Young Chris Floyd Joshua Frank Robert Fantina Brendan Cooney Mark Almond Lois Gibbs Rev. William Alberts Kathy Kelly John Ross David Michael Green Bill Moyers / Ron Jacobs Richard Rhames David Yearsley Lee Sustar Brenda Norrell Ben Terrall Poets' Basement Website of the Weekend August 8, 2008 Patrick Cockburn Manuel Garcia, Jr. M. Shahid Alam Andy Worthington Lawrence J. Korb David Model Alan Farago Diop Olugbala Firmin DeBrabander Website of the Day August 7, 2008 Dr. Trudy Bond William Blum Paul Craig Roberts Ralph Nader Robert Weitzel Jacob G. Hornberger Binoy Kampmark David Macaray Howard Lisnoff Website of the Day August 6, 2008 Marc Herold Greg Moses Sheldon Rampton Kevin Young Michael Estrada Robert Weissman Dr. Susan Block Cindy Sheehan Ace Hoffman Website of the Day August 5, 2008 Paul Craig Roberts Jeff Halper Patrick Cockburn Nancy Welch Peter Morici Sousan Hammad Eamon Martin Shepherd Bliss Tim Matson Website of the Day August 4, 2008 Uri Avnery Saul Landau David W. Remington Rev. Jesse Jackson Dave Lindorff Peter Morici Joanne Mariner Ramzy Baroud Christian Wright Website of the Day August 2 / 3, 2008 Alexander Cockburn Jeffrey St. Clair Patrick Cockburn Winslow T. Wheeler James Abourezk Andy Worthington Brian Cloughley Robert Fantina Benjamin Dangl Marlene Martin David Yearsley Fatemeh Keshavarz David Michael Green Obama as Dukakis Harvey Wasserman Jason Hribal Phyllis Pollack Laray Polk Ron Jacobs David Macaray David Rosen Dan Bacher Joe Allen Poets' Basement Website of the Weekend August 1, 2008 Jonathan Cook Nikolas Kozloff Rannie Amiri Peter Morici Christopher Brauchli M. K. Bhadrakumar Patrick Cockburn James J. Brittain Dan Bacher Website of the Day
July 31, 2008 Michael Hudson Carl Finamore Mike Whitney Joshua Frank Andy Worthington Ralph Nader Bill Moyers / Robert Weissman Dave Lindorff Website of the Day July 30, 2008 Brian M. Downing Chuck Spinney William S. Lind David Ker Thomson Karl Grossman Mike Whitney Martha Rosenberg James Murren Dave Lindorff Ron Jacobs Website of the Day July 29, 2008 Jeffrey St. Clair John Ross Peter Morici Alison Weir Gary Leupp David Macaray Brenda Norrell Marjorie Cohn Eric Ruder Website of the Day July 28, 2008 Dr. Bryant Welch Kathy Kelly Mike Whitney Peter Morici Christopher Brauchli Clifton Ross Stephen Lendman Website of the Day
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August 22, 2008 Table Talk at Jackson HoleIs the Fed Still a Central Bank?By PETER MORICI Federal Reserve officials, academics and central bankers from abroad are gathering for Ben Bernanke’s annual confab in Jackson Hole Wyoming to discuss the management of financial crises. A better topic might be: Is the Fed Still a Central Bank? Essentially, national monetary authorities do two things. Central banks manage liquidity in their national capital markets—the supply of credit to finance businesses, new homes and consumer spending. Central banks and banking authorities regulate commercial banks and other depository institutions to ensure their solvency and the adequate availability of credit to businesses and consumers. The Fed manages liquidity by regulating federal funds rate—the rate banks charge one another to borrow reserves that back up loans. Historically, by varying the federal funds rate, the Fed could influence the interest rates charged on loans of various maturities ranging from the prime rate on business loans to 30 year mortgages and corporate bonds. In this decade, the United States has run large and growing trade deficits on imports of oil and consumer goods from Asia. Essentially, Saudi Arabia and other oil exporters cannot spend all they charge for oil and invest the rest—much of it in U.S. Treasury securities and other U.S. debt instruments. Also, the People’s Bank of China and several other foreign monetary authorities intervene in foreign exchange markets—selling their own currencies for dollars—to keep their currencies and exports inexpensive in U.S. markets. In turn, foreign central banks and sovereign wealth funds have huge quantities of dollars they invest in U.S. securities. Consequently, the Fed has lost its ability to manage interest rates charged on loans with longer maturities, like mortgages and corporate bonds, and can no longer effectively manage liquidity by raising and lowering the federal funds rate. In recent years, the Fed’s responsibility for the large monetary center banks and its knowledge of large investment bank activities that function as primary securities dealers in open market operations has become more critical. Since the Savings and Loan Crisis of the 1980s, banks throughout the country have adopted the securitization model of banking. Instead of relying on deposits to fund loans, they sell loans to money center commercial and investment banks who bundle these into bonds for sale to pension funds, insurance companies and large investors like foreign central banks and sovereign wealth funds. To avert crisis the Fed has loaned the money center banks and primary securities dealers hundreds of billions of dollars through the discount window—some of those loans are collateralized by bonds of highly questionable value. These special assistance programs were supposed to be temporary but now the deadline has been extended to January 2009. The fact is it may be extended again and again, because the banks and securities dealers may not have the liquidity to redeem their paper and still have adequate reserves. Hence, the Fed does not regulate the banks to ensure their banks solvency, it just props them up. The Fed's mistake was not stepping in, within a very short period, and imposing conditions on its loans--namely forcing the money center banks and securities companies to reform their management practices, abandon incentive schemes that encourage high risk taking for big bonuses, and obtain a commitment from the large financial institutions to fully function as commercial banks, in addition to pursuing their other more healthy businesses. That would have required them to underwrite soundly written business loans and mortgages, and offer plain vanilla bonds to investors, who could understand and accept the bonds they were being offered. This would reopen the bond market to securitized mortgages and business loans. By imposing these conditions, the Fed would have become the large money center bank regulator, in full, until the "crisis" passed. That is until its special loans to the banks and securities dealers were repaid, if not longer. Instead, by giving the big banks and securities companies revolving short-term loans against questionable paper, it has become hostage to their actions. If they all behave more or less the same, the Fed can't pull the rug out from under all of them without crashing the financial system. Neither the Fed nor the other Federal regulatory agencies can effectively regulate the bank. The banks have not altered their incentive structures for executives. Instead, they are abandoning the securitization of mortgages and other loans for sale to fixed income investors, and encouraging executives to focus on their most profitable business lines. However, if the Fed is going to guarantee the solvency of these enterprises, it should require they engage in commercial banking. Although fixed income investors and foreign central banks have vast pools of capital to invest in the United States, many sound businesses and homebuyers cannot access it, and the Fed has failed to ensure the adequate availability of credit to businesses and consumers. If the Fed is not effectively managing liquidity, regulating banks to ensure their solvency and the adequate availability of credit to businesses and consumers, I am not sure the Fed is functioning as a central bank. I do know Ben and his friends will enjoy some good food and fine conversation in Jackson Hole. Peter Morici is a professor at the University of Maryland School of Business and former Chief Economist at the U.S. International Trade Commission.
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