Illusion of Fulfillment.

“The president told Democrats that making change happen is hard and ‘if people now want to take their ball and go home, that tells me folks weren’t serious in the first place.’” As part of a continuing pattern of late, President Obama tells Rolling Stone that progressives need to stop whining about the way things are going and get happy, because, in what’s become a new talking point, “If you look at the checklist, we’ve already covered about 70 percent [of the 2008 campaign promises.]” (70%?! Uh, can I see this checklist?)

Anyway, this latest weird effusion against the base has already been well-critiqued and well-answered many times. See, for example, Glenn Greenwald and David Dayen: “I’ve never seen a politician run an election with the message ‘Don’t be stupid, quit your bitching and vote for me.’” I would only add two things:

1) As it turns out, the unhappy Dems among us are more likely to vote, so perhaps berating them for not clapping enough is not altogether productive. (Unless, of course, the WH is doing it as a Sistah Souljah bank shot to get independents, on the classic establishment premise that indies love hippie-punching.)

2) I’d love to live in a world where progressive bloggers have the power to move ginormous voting blocs, I really would. But it takes a certain type of top-down, Beltway-obsessive mentality to think that’s what’s going on here. The biggest reason voters are depressed is because the economy is, quite obviously, not doing so well at the moment, and people are feeling the pinch. And, that aside, most Obama voters don’t need blogs to tell them that this administration, on all too many fronts, hasn’t lived up to its promises.

If this White House wants to engage the base (and I really, really hope they do, for reasons personal, professional, and patriotic), then, for Pete’s sake, don’t browbeat and lecture the Left for being disappointed — Try to make them less disappointed! Give them some red meat, respond to their concerns, and, you know, do the things you were elected to do. Why this even has to be said is beyond me.

Clap louder, hippies.

“They will be satisfied when we have Canadian healthcare and we’ve eliminated the Pentagon. That’s not reality.’ Of those who complain that Obama caved to centrists on issues such as healthcare reform, Gibbs said: ‘They wouldn’t be satisfied if Dennis Kucinich was president.’” In the virulently stupid department, insulting the base and further depressing midterm turnout = change we can believe in? Um, no, not really. Thankfully, I was away from civilization when press secretary Robert Gibbs threw his whiny temper tantrum about “the professional left,” so I missed out on the initial bout of aggravation about it.

Suffice to say, Robert Borosage, among others, was on the case: “The left is pushing the president from the left? The horror. The shame…The president is in trouble because his historic reforms were too timid, not too bold…We can argue about whether the president fought hard enough, or compromised too soon — but the reality is that the reforms, as bold as they were, are not sufficient to deal with the mess we are in.” And that doesn’t even get into the torture and civil liberties clusterfrak, where reform has been non-existent. Dennis Kucinich? I’d be happy with the Barack Obama I ostensibly voted for, thanks much.

Obey Wan.

“I don’t know what my biggest contribution has been. I think it has been simply showing up for work every day, trying to fight the good fight for average people…But I leave more discontented when I came here because of the terrible things that have been done to this economy by political leaders who allowed Wall Street to turn Wall Street banks into gambling casinos which damned near destroyed the economy.“

On the eve of his retirement, Chair of the House Appropriations Committee David Obey has some choice words for the administration, and himself. “I think the more important thing was what was my biggest failure…our failure to stop the ripoff of the middle class by the economic elite of this country, and this is not just something that happened because of the forces of the market.”

WH to Bloggers: Drop Dead (Again).

“[T]o the extent that the ‘liberal left’ is upset at the President, it’s because they are seeing a great opportunity slip away in real time. The only one that told the base that they could change America from the bottom up and bring forth a transformative new era of leadership is Barack Obama. If he didn’t want one, he shouldn’t have said anything.“

In response to the most recent disparaging of liberal and progressive blogs by “senior administrative official” to his or her media lap dog of choice, FDL’s Dave Dayen gets to the heart of progressive consternation with Team Obama: “Nobody had a bigger challenge coming into office than Barack Obama but nobody had a bigger opportunity. And liberals like myself are generally peeved that the opportunity has been squandered. Yes, squandered.” Yep, sounds about right.

In very related news, with the passage of financial reform in the Senate today, The Prospect‘s Kevin Drum gets off a zinger about Obama’s legislative accomplishments thus far. I think, overall, this president could have accomplished much more than Drum’s biting joke suggests — most obviously on executive power issues like torture and indefinite detention. (Or, put another way, I just get irritated with people who throw up their hands and say the problem with our politics is entirely structural when you have an ostensibly-lefty president saying patently dumb things like this. Choices matter, and this administration makes terrible ones.) All that being said, Drum’s comment was still worth a (rueful) laugh regardless.

The Deficit-Witchhunt: The Long Depression.

“We are now, I fear, in the early stages of a third depression. It will probably look more like the Long Depression than the much more severe Great Depression. But the cost — to the world economy and, above all, to the millions of lives blighted by the absence of jobs — will nonetheless be immense. And this third depression will be primarily a failure of policy.“

They used to tell me I was building a dream…In the NYT, Paul Krugman calls out the deficit peacocks one more time before the wheels come off around the world. “[This is] the victory of an orthodoxy that has little to do with rational analysis, whose main tenet is that imposing suffering on other people is how you show leadership in tough times. And who will pay the price for this triumph of orthodoxy? The answer is, tens of millions of unemployed workers, many of whom will go jobless for years, and some of whom will never work again.“

In very related news, from the bowels of the Fed comes a taxpayer-paid response to Krugman, DeLong, and others sounding the alarm about the deficit witchhunt: Quiet, you nasty bloggers! You have not sufficiently mastered our economickal arts! “[W]riters who have not taken a year of PhD coursework in a decent economics department (and passed their PhD qualifying exams), cannot meaningfully advance the discussion on economic policy…[T]here is extremely low likelihood that the speculations of the untrained, on a topic almost pathologically riddled by dynamic considerations and feedback eﬀects, will oﬀer anything new.“

Having spent much of the past decade in academe, I’d like to point out that this is a pretty classic overreach by the writer here. I mean, you spend all those years chasing down a degree that’s not particularly useful anymore…there must be some upside to it, right? Am I not now part of the intellectual — in this case, macroeconomic — Elect? No, Mr. Athreya, I’m afraid not. Sometimes people spend so much time examining, say, the myriad variances in an oak leaf (or worse) they miss the forest for the trees.

Update: In an attempt to move past the entitlement-cutting hysteria out and about in DC at the moment, the Center for Economic Policy and Research offers up handy tool: The People’s Deficit Calculator. “The budget options in the calculator include ending the wars in Iraq and Afghanistan, adopting a carbon tax, reduction in the size of the health care subsidies created by the health care reform bill, progressive price indexing of Social Security, adopting a financial speculation tax and others.“

Update 2: James K. Galbraith reads the riot act to the deficit witchhunt tribunal. “You are plainly not equipped, either by disposition or resources, to take on the true cause of deficits now or in the future: the financial crisis.”

The Deficit Witchhunt: Self-Immolation Time.

“The terms on which the U.S. government can borrow now are exceptionally advantageous. And because of high unemployment the benefits of boosting government purchases and cutting taxes right now are exceptionally large…[R]ight now, as best we can tell, an increase in federal spending or a cut in taxes will produce (in the short run) no increase in interest rates and hence no crowding-out of productivity — increasing private investment. Indeed, government spending that adds to firms’ current cash flow may well boost private investment and so leave us, dollar for dollar, richer after the effect of the stimulus ebbs.“

As the recent wave of deficit hysteria hits the G20, prompting a frightening and idiotic retreat back into Hooverism (As Krugman put it: “Utter folly posing as wisdom“), economist Brad DeLong explains once more the the case for deficit spending during a recession. THIS IS NOT ROCKET SCIENCE, people (which is why 3/4ths of voters already get it.)

Krugman: Enough with the Deficit Panic.

“What’s the greatest threat to our still-fragile economic recovery? Dangers abound, of course. But what I currently find most ominous is the spread of a destructive idea: the view that now, less than a year into a weak recovery from the worst slump since World War II, is the time for policy makers to stop helping the jobless and start inflicting pain.” The NYT’s Paul Krugman weighs in on the deficit hysteria afflicting Washington right now. Honestly, this is Keynes 101, people — you don’t dial back government spending at a moment of incipient recovery, or else you end up with things like the 1937 Roosevelt Recession.

FWIW, the deficit witchhunt may be rolling in DC, but the bond markets aren’t listening. “On Friday, they were willing to hand over their cash to the Treasury for 10 years for 3.3 percent interest, a level so low it implies they consider the United States among the safest investments in the world.“

In a Flash, a Grim Recognition.

“The initial reaction of traders to the Flash Crash was that some human must have made a mistake submitting a trade. But the SEC…hasn’t found evidence of a ‘Fat Fingered Louie’ punching a billion rather than a million on an order. In fact, the SEC still doesn’t know what caused this crash. Curiously, no one is focusing on what caused the crash to stop…JP Morgan and Merrill Lynch were big buyers precisely as the market hit minus one thousand points on the Dow. It seems rather odd that both these firms at the same time would see the same trading opportunity.

In fact, what they did was violate one of the prime rules of trading: never try to catch a falling knife. The market was falling fast and furious at the point they entered the pit to buy equity futures, so why did they take such an enormous risk? We learned yesterday that both of these firms, plus Goldman Sachs, were such superb traders in the market that none of them had a single losing trading day all last quarter. This type of risky trade is not how you get to be a superb trader.“

Over at the Agonist, Numerian digs deep into last week’s “Flash Crash” — and comes to some very troubling conclusions. To wit, the big players know the thresholds where the trading algorithms kick in, and thus, basically, the fix is in. “The stock market seems to be nothing but a playground for the big banks and other connected firms who get a preview peek at everything that goes through the market, and who can program their computers to skim profits off daily with no risk whatever. The stock market is also, quite possibly, prone to more serious manipulation that resulted in last Thursday’s crash.“

Oof. I’m out of my comfort zone when it comes to understanding market behavior, so I hope someone has a better explanation for the Flash Crash than the disconcertingly plausible one offered here. (Just saying Greece doesn’t quite cut it, I don’t think.)

The Witchhunt is On.

“Is our huge deficit a problem today? Not if you think people should have jobs. Private sector demand has plunged because of the collapse of the bubble. If the public sector does not fill the demand gap with deficit spending, then we have less demand and fewer jobs. That’s worth saying a few hundred thousand times since the deficit hawks have filled the airwaves and cyberspace with so much nonsense.“

The CEPR’s invaluable Dean Baker rails anew at the deficit hysteria currently in Beltway vogue. I’ve said this several times already now, but I just cannot take anyone seriously who froths and frets about looming deficits, but then says nary a word about out-of-control defense spending. And right now, when it comes to such deficit peacocks, DC is a full-fledged menagerie.

Update: “The danger posed by the deficit ‘is zero. It’s not overstated. It’s completely misstated.’” Ezra Klein talks with James Galbraith, son of the venerable J.K. Galbraith and originator of the great witchcraft metaphor, about the deficit hysteria seizing Washington:

“[W]e should be focusing on real problems and not fake ones. We have serious problems. Unemployment is at 10 percent. if we got busy and worked out things for the unemployed to do, we’d be much better off. And we can certainly afford it. We have an impending energy crisis and a climate crisis. We could spend a generation fixing those problems in a way that would rebuild our country, too. On the tax side, what you want to do is reverse the burden on working people. Since the beginning of the crisis, I’ve supported a payroll tax holiday so everyone gets an increase in their after-tax earnings so they can pay down their mortgages, which would be a good thing.“

FinReg: Where Things Stand.

“Last week, Congress decided it would not confront Too Big To Fail, the single gravest threat to our collective financial security. But there are still several key Wall Street reforms worth fighting for–reforms that must be enacted before the next crisis hits, with or without a big bank break-up. And fortunately, key Senators have authored amendments dealing with each one.” In HuffPo, Zach Carter delineates the most worthwhile progressive amendments to financial reform still up for debate in the Senate. A good encapsulation of the state of play.