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tmaly 6 hours ago [-]
The direction of the 10Y is what people should care about as this a proxy for mortgage rates.
The current direction is not going where consumers would want.
miohtama 23 hours ago [-]
Reuters attributes this to be somehow a personal flaw in Walsh.
Pretty sure Jerome Powell, the previous chair, would have done exactly the same thing. In fact Jerome Powell is still in the Fed and participated in this decision.
0x53 22 hours ago [-]
I think the article makes a good case why the difference in chair matters
- ending forward guidance
- confusing wording around what the target is now (pce vs “other stuff”)
- The fact that he was appointed specifically to not raise rates
None of the applies to Mr. Powell whom the market seems to have put a great deal of trust in
matwood 22 hours ago [-]
Maybe I missed it, but did Walsh explicitly say it's tariffs and the war driving inflation? There's a reason Trump was fighting with Powell.
Jerome Powell would’ve communicated in a mealy mouthed and confusing way that was meant to appease Trump?
I’ve had quite enough of Trump’s “meritocracy”, personally.
ndsipa_pomu 13 hours ago [-]
I think the word you were looking for is "kakistocracy" - government by the worst, least qualified, or most unscrupulous people.
Barbing 23 hours ago [-]
Not Hacker-y enough I think; dropped to third page from first. Now rank 79, +108 points, 42 comments, +3hr
Thanks for the link, hope they figure it out.
seanhunter 23 hours ago [-]
Speaking as a non-American, and without the lens of partisan politics, it seems incredibly obvious to me that
Kevin Warsh < Jerome Powell < Janet Yellen
... in terms of credibility as an economist, with Ben Bernanke one step to either side of Powell depending on how much you feel he was a victim of circumstances in the 2008 crisis.
That said, the current problems in the US economy are entirely out of the control of the Fed and all to do with the current administration's policies (mainly the war vs Iran driving commod vol and the on-again off-again trade tariff shuffle driving fx vol) and the long-term deficit position driving rate curve shenanigans. The AI and private credit bubbles are just adding to the anxiety. All of this ultimately feeds into domestic inflation and job market malaise.
The bond market generally doesn't take shit from anyone and it's not surprising to me that bond investors are not impressed. None of that is on Warsh.
webninja 1 hours ago [-]
I am a U.S. citizen so I have a stake in the success or failure of our country. Old Dinosaur Janet Yellen single handedly added more to the U.S. federal debt more than any other person in modern history. The damage she did, is the kind of damage someone would historically burn at the stake for. Trillions of debt that your future kids will have to repay casually makes you want to bring up the topic of back tar and feathering. I don’t know enough about Kevin Warsh yet to comment about him but Powell (unlike Janet) was at least very at his job, even if he frequently treated lagging economic indicators like leading indicator. Through lagging heavy actions that made me wealthy enough to put a down-payment on a house, Powell turned the Fed from a fairly unknown, hidden organization into a household name. The Fed should not be as popular as a celebrity on TMZ because it brings politics and incompetent influencers into the decision outcomes.
fragmede 49 minutes ago [-]
It is misleading to imply she personally chose to create that debt. Congress and the President decided on it, she was simply the head of the Treasury department responsible for financing them. And the "them" is Covid, the CHIPs act, interest rates and refinancing.
cyberax 21 hours ago [-]
Look at outcomes, not just words. Bernanke made a correct prediction that the rate had to stay low and that it wouldn't result in high inflation.
Meanwhile, the ECB started raising the rate once the economy stopped crashing. And that promptly caused the second recession in Europe.
orwin 21 hours ago [-]
What caused the second recession in Europe was a decrease in energy supply. Country that depended the most on the North sea or North Africa oil and gas exports suffered the most.
We still live under the constraints of our world, and energy availablity is a big one.
cyberax 12 hours ago [-]
I'm talking about the rate hikes in 2010-2011 after the economy started picking up.
The actions of the ECB caused at least 10 years of misery for Europe. The 2008 crisis was inevitable, but the US bounced back from it within 2 years. While Europe is _still_ not fully recovered.
Bernanke deserves a lot of credit for that. He was brave enough to ignore the deficit hawks who were screaming about "inflation" and "debasing the dollar".
jmyeet 1 days ago [-]
As everyone should know by now, the US government runs a massive deficit, that is the difference between tax receipts (and other income) minus expenses. The current US public debt is hovering around $40T and the annual deficit is pushing toards $2T.
A lot of that $40T was borrowed at lower interest rates but let's assume for argument's sake that it was borrowed at 5%. That's $2T in interest alone every year. There's a huge difference between adding $2T in debt at 5%+ every year vs 1-3%.
The Fed has auctions to sell its debt. That market clears at a certain interest rate so if the market isn't buying the debt the rate the Fed pays has to go up. That's what's happening here.
What's driving this is that inflation is above the ~2% target. Well above, actually. There are generally two ways of tackling high inflation: with monetary policy (ie raising interest rates) and with fiscal policy (by raising taxes). Modern US administrations (both parties) have completely abandoned any pretense of ever raising taxes. That was the appropriate solution during the inflation shock of 2020-2022. Some European countries did this with a corporate windfall profits tax (eg Spain). The US did not.
The problem is that since housing is such a huge part of consumer spending, higher interest rates mean higher mortgage rates, which means higher housing expenditure, which means higher inflation. Now luckily most mortgages in the US are 30 year fixed so this is slow to respond and only really affects new mortgage. Other countries aren't so lucky.
But the big drivers in inflation are soaring grocery costs and energy costs. Energy costs, particularly diesel, is a massive driver of inflation. The rise in groceries since Covid has completley outpaced inflation while real wages have fallen. There's only so much more inflation the American consumer can take. Household savings rates are already very low so there's very little in the way of a buffer to absorb higher costs.
This is all being exacerbated by the disastrous war in Iran and the war in Ukraine. Russia had been a net exporter of diesel until recently as Ukraine has damaged an estimated 40% of Russian refining capcity. Refineries in the Gulf have also been taken offline. There's been a loss of over 1 million barrels per day in refining capacity. This is somewhat paradoxically why crudel oil prices are relatively low given all that's going on: because crudel oil is mostly useless unless it's refined. Destroy refineries and demand for oil goes down. But the demand for refined petroleum products goes up, way up [1].
It should be noted that China has essentially saved the world economy up to this point [2]. The closure of the Strait of Hormuz blocked the passage of ~20 million barrels per day of crude (plus 20-30% of the world's natural gas plus fertilizer plus helium). The inflation shock of 2020-2022 occurred because we lost "only" 10 million barrels. But China seemingly cut their imports by 5M. Saudi Arabia diverted 5-7 via the East-West pipeline to the Red Sea. The US has been draining the strategic reserve and so net we've only lost a few million barrels per day. That's temporary. the SPR has hit historic lows not seen in 40 years and it can't get much lower without risking a collapse of the salt caverns it's stroed in in Louisiana. Nobody knows if and when that'll happen because we've never done this before.
The backdrop for all this is that there has been a decades-long effort at this point to essentially loot government coffers in the US. More tax cuts for the top 0.01%. The Western world in general has reached a breaking point where land hoarding and wealth need to be taxed or society as we know it will actually break down. I'm not being hyperbolic. Currently, there's no concern for that from the looters because upheaval means war, which means more weapons sales. Also, free movement of capital means the wealthy believe they can just flee.
For context, a mere 10 years ago the US total public debt was ~$16T. It's 2.5x'ed in a decade and only going to get worse unless something drastically changes.
Warsh was put in to cut rates for political purposes. The best he can do is to hold rates steady because they really should go up in an environment where we aren't going to raise taxes.
As for Iran, it's been clear since at least April, that this is an unmistakable and undeniable total strategic defeat for the US and there is no way out other than to surrender. This event will be written about in history books as a turning point in the world order that was designed by the US, for the US after 1945. We are entering a new era. This is going to redefine US relationships all over the world.
American fixed 30y mortgages actually make interest rate policy much less effective, in theory.
In most countries with normal mortgages, raising rates fairly immediately transmits through to the rest of the economy, because it affects the mortgage market. This isn't true in America, because everyone quite reasonably is able to get these insane mortgage products with literally no downside risk - if rates go up, you don't pay more. If they go down, you refinance at minimal cost.
Agree to disagree on the tax issue. The way you've framed it is fairly inflammatory, but happy to have a discussion about it. The reality is that as much money as rich people have, the middle class have a whole lot more. Every country with large government spending has broad, high taxes on the entire population, not just the rich.
Since 1990 the top 1% of wealth holders have seen their share of the wealth increase significantly, almost entirely on the backs of the middle class (and to a lesser extent, the upper-middle class).
The middle/upper middle class may have more collectively than the wealthy, but this is why the middle feels materially poorer and more reactionary than they were 30 years ago. They are being outcompeted in housing (unfairly, by people with vastly more wealth) and are being overcharged and underdelivered on medical care, education and food.
The rich need to be taxed back down to a reasonable share of wealth (<20%) or the politics of the country will continue to be unstable because the masses will continue to vote for change, every election, in search of that outcome.
fjfaase 23 hours ago [-]
This is not uniquely American. Here in the Netherlands we also have fixed interest rates for long periods. Usually for 20 years.
avmich 24 hours ago [-]
So you don't buy the POV the middle class is squeezed out of existence, almost?
Panzer04 20 hours ago [-]
Not really.
I earn a reasonable income, but the reality is even though I live alone and don't really think about where I spend my money finances are good. I could quite easily save a fair bit more than I currently do if I wanted to.
My experience won't align with everyone, but it is enough for me to feel somewhat dismissive of people who say life sucks. At some point, if you aren't earning enough and/or spend too much, that's on you. Some of the people I know of who complain about finances feel they should not have to care about their spending, or have "luxuries" that are actually very expensive (going out drinking alcohol is a big one where I'm at). The reality is anything that takes human Labor in a developed economy is very expensive.
jmyeet 15 hours ago [-]
I would say 30 year fixed mortgage is one of the few things the US does right. Housing shouldn't be an investment and you shouldn't be able to hoard land to raise prices. As Xi Jinping said, houses are for living, not for speculation [1].
We have an affordability crisis. What good would increasing mortgage payments do when housing is one of the biggest single expenses? The point of raising interest rates is to take the economy off the boil, essentially by cutting down on discretionary spending. Grocery prices are up 30%+ since the pandemic. Are people eating too much? Can you eat less? Consumer demand isn't doing that. Various forms of dynamic pricing (eg surveillance pricing) are doing that. The only reason for dynamic pricing to exist is to raise prices.
Beef prices in particular are through the roof and the only reason is price collusion. Meat packers have been sued by states about it. The root cause? AI. They're using the same AI system to set prices so the AI company has access to all the pricing information. That's the 2020s version of collusion. It's the same thing with RealPage and landlords. And something's gotta give. This system is unsustainable.
The interesting thing is, US media, US social media driven by Big Tech algorithms, Google Search, nytimes, reddit, Social newsfeeds of students, teens, teachers is not exposing this at all. It feels like we are self-contained information exposure bubble too. Only a physical visit outside of US, and looking at the information from outside of US will give a picture of the mistakes being made here.
ghtbircshotbe 18 hours ago [-]
The national debt was in the news a lot in the 90s and 00s and the sky didn't fall. Now both parties have decided they don't care, and I'm sure they'll find other things to blame when growth shrivels etc.
RickJWagner 17 hours ago [-]
Even before then it was widely discussed. There was even a Schoolhouse Rock song, “Tyrannosaurus Debt”.
dlcarrier 23 hours ago [-]
Don't overlook quantitative easing. Introducing more money into a monetary system has a significant inflationary effect on the money that was already present.
Also, housing costs don't statically climb as interest rates go up. A decrease in market price makes up for most of the difference.
nonethewiser 22 hours ago [-]
But Warsh wants to unload the Feds balance sheet so this is very much in agreement with his policy.
bayarearefugee 1 days ago [-]
And somehow this situation is all Joe Biden's fault, and Trump is still going to fix it, any day now.
A very significant amount of American voters believe this. To this day. And their belief in this is still being reinforced by the vast majority of the "mainstream media" which they believe is left-biased, which hasn't been true for very many years at this point.
This is why we are fucked and there is no way out of this that doesn't involve existential threat to our current society.
Shocka1 9 hours ago [-]
I don't think picking sides is helpful here at all, but I do agree with you that we are more than likely screwed. The average left or right leaning American has no idea how a bond even works. Experiment - ask random people in your life (with tact of course) how bond yields affect bond prices. YMMV, but I would guess more often than not they would not know. The same people can tell you what's going down on Facebook/Instagram, but other than that both sides seem to be hypnotized or outraged on rotating social media topics. It's actually very disturbing to me at times, but what can ya do?
jmyeet 1 days ago [-]
I understand the point you're making about blind devotion to Trump but the reality is that Biden is not free from blame here, in four ways:
1. Trump in his first term created the Abraham Accords that directly contributed to the genocide that has since happened (by excluding Palestinians from the process). Biden did not reverse any of that because he is an avowed Zionist;
2. Trump blew up the JCPOA that sought to include Iran in the international community for really no reason than to please his donors, particularly his biggest donors, Sheldon and Miriam Adelson, who are also avowed Zionists. This was an Obama-era deal and part of me is convinced that Trump blew it up simply because it had Obama's name on it. Biden of course did not reinstate it;
3. Trump blew up energy markets in 2020 with the disastrous OPEC deal he made in June that created the inflation shock of Covid. Biden quietly went to MBS to get him to increase oil output. He refused. Biden said nothing. He absolutely could've waved a very big stick to get MBS to change course here, notably by threatening arms shipments; and
4. The so-called "bear-hug strategy" following October 7 set the stage for everything that's happening now. At any point in the last more than a year of his term, Biden could've ended that conflict with a phone call. He did not because, again, he is an avowed Zionist. That both emboldened Israel to drag the US into the Iran war and also was a key factor in the Democrats losing the 2024 presidential election although I'm not actually convinced we'd be in a vastly different situation had Kamala won (eg [1]).
US foreign policy is surprisingly uniparty.
Oil is good for business because it's good for war. It's also why we don't have major investment in renewables. As this article put it, nobody goes to war over a solar panel [2].
No comment on the points you made, but thanks for the article No One Goes to War Over a Solar Panel' was a good read.
nikau 24 hours ago [-]
I can't understand the logic behind party A did something, and then blame party B for not undoing it.
Not everything is a simple ctrl-z, and the blame lays squarely on who implemented it.
lowbloodsugar 24 hours ago [-]
A mugger stabs your friend and runs off. They are bleeding out. You do nothing. That’s what he’s saying. The fact is Biden did nothing to prevent this. Including not locking the fucker up. Not stacking the Supreme Court after the Ginsberg shitshow.
mittensc 23 hours ago [-]
> They are bleeding out. You do nothing
There are a lot of people that do not know what to do.
There are also wounds that you can't really do anything about without hospital. (internal bleeding?!)
The funny thing is, as analogies go, here the friend tells you to bugger off because of israel and tells the mugger to come back and help him... mugger stabs him some more
itake 23 hours ago [-]
I hear you, but I really don't want the government flip flopping every 4-8 years on policy.
"stuck in the past" vibes vs making progress
lowbloodsugar 15 hours ago [-]
“I do not like flip flopping, so I’m gonna be a fascist too.”
itake 15 hours ago [-]
Who are you quoting?
I've voted democrat in every election since I was 18.
jmyeet 14 hours ago [-]
It's called the ratchet effect [1]. In our modern political paradigm, conservatives torch the economy, introduce heinous policies and give massive tax breaks to the wealthy until their popularity drops enough that Democrats get voted in and... do nothing. This has several names such as "controlled opposition" and the "mirage of dissent" [2].
As an example, take the current Iran war. There's very little opposition in establishment politics to the actual war. What you get instead are process objections, such as the president not consulting Congress. Objecting to the process is a way of appearing to be in opposition without being in opposition.
This was ultimately why Kamala Harris lost the 2024 election. "Trump bad" isn't a platform that people get excited for. People are asking "what are you going to do about it?" and her answer was... nothing. It was the culmination of years of what's been called "lesser evil voting" or "harm reduction voting". Democrats have adopted a platform of just not being quite as bad as the Republicans, probably because they have the exact same donors. And millions of voters stayed home in 2024 rather than vote for the status quo.
So back to the JCPOA, Biden should've done something but did nothing. Because he likes what Trump did. He agrees with it. And so do most Democrats. That's the point.
Not helped by both parties uniting wherever necessary to freeze out outsiders (socialists, libertarians, or even liberal reformists). Anything to preserve the status quo.
jquery 13 hours ago [-]
Other than Dems having a super majority for a few weeks with Obama, when was the last time they were “voted in” at a national level?
Biden did a pretty good job cleaning up after Trump. Was he perfect? Not even close. But Dem primary voters had the option of more progressive candidates and instead they circled around Biden. Did donors try and engineer a Biden win? Sure. Were voters obligated to go along with their scheme? Also no.
The blame for our situations rests squarely on the shoulders of the American people, who have been living so insulated from the consequences of their votes that they entertained a guy like Trump, twice.
jmyeet 13 hours ago [-]
First the super majority isn't a constitutional or even legislative barrier. It's simply a Senate rule. Rules for the Senate are established at the start of every Congress. There's no reason why the Senate couldn't simply eliminate the rule.
Republicans like the filibuster because they can force through most of what they want under reconciliation, which only requires a simply majority, and they can block Democrats with a minority. Democrats like the filibuster because it gives them an excuse to do nothing. Because a lot of what Democrats want to do isn't filibuster-proof.
Also, the filibuster once meant that you had to stand up and hold the floor to block a vote. Now we have a silent hold since the 1970s. If you for some reason believe in needing 60 votes to end debate, why not at least adopt the earlier interpretation that requires someone to stand at a podium? Because Democrats don't want to do anything. That's why.
Biden had four terrible decisions in his presidency:
1. Appointing Merrick Garland as AG. He's another establishment Democrat that didn't want to do anything, really, particularly not prosecute the insurrection that took place. He was embarrassed into doing so by the January 6 Committee. He basically lost 2 years of potentially prosecuting the administration;
2. His Israel policy, particularly the bear hug strategy and especially not ending the genocide;
3. Not raking MBS over the coals for not ending the Trump 2020 OPEC deal, wich exacerbated the inflation price shock; and
4. Running for re-election.
It's worth adding that the only reason Biden was the candidate was because the DNC was scared Bernie Sanders would be the candidate so they fixed the race in South Carolina thanks to Jim Clyburn in particular. Everyone dropped out of the primary and got rewarded with Cabinet posts, etc (eg Pete Buttigief as DoT Secretary). Except one. Elizabeth Warren stayed in to split Bernie's vote.
As for blaming the voters, I 100% disagree. The party leadership has repeatedly engineered situations to give the voters terrible choices and rely on lesser evil voting. After the 2017 election, the DNC got sued and argued in court that they had no obligation to stay neutral. That was a political promise not a binding promise. Basically, they argued that they were free to overrule the will of primary voters with superdelegates and manipualting of funds by then DNC Chair Debbie Wasserman Schultz, who when exposed and was forced out, just went and joined the Hilary campaign.
Voters stayed home in the millions in 2024 (vs 2020) because they were given no choice. They're not responsible for that. The candidate is. And if you end up being angry about Kamala losing, blame her for having a terrible platform, not the voters who decided a slightly better candidate was the only available choice.
aaronsung 22 hours ago [-]
>The so-called "bear-hug strategy" following October 7 set the stage for everything that's happening now.....Biden could've ended that conflict with a phone call.
Both sides have been preparing for the conflict for decades. The bomb that the US used to bomb Iran's nuclear facilities, the GBU-57A/B MOP, began development in the early 2000s[1]. Iran has long supported the Houthis, who have been attacking Saudi Arabia, a key US ally in the Middle East and one of the main suppliers of oil to the West. Iran has been the major competitor to the US, or even the West, for a long period of time. Oct 7 is just a trigger point, like the Sarajevo assassination was the trigger point of WW1.
> Trump blew up the JCPOA that sought to include Iran in the international community for really no reason than to please his donors
Indeed, a few of the US allies in the Middle East, like the UAE, Saudi Arabia, as well as Bahrain, expressed concerns over the Iran nuclear deal[2].
We are entering a critical point in time, where Western civilization may not dominate the world anymore like it did for the past 300 years. There will be a lot of instability, though a lot of people fail to recognize that and are underprepared.
Oh, I'm not exactly a huge Joe Biden fan. I just think it is ridiculous that nobody "on the right" calls Trump on using him as a universal scapegoat for everything as we continue to fumble into an economic situation that Trump is consistently actively making worse.
I think Biden did manage to enact some good domestic economic policy in a tough political environment, but in addition to everything you pointed out that I agree with he obviously should have stepped aside for the 2024 election long before he did and his decision to nominate Merrick Garland for Attorney General will be seen as one of those history book moments of very high consequence in the fall of an empire (assuming we have legitimate history books in this future).
Plenty of blame to go around for many Democrats here for both the fact that our disastrous foreign policy is, as you've said, uniparty, and also their fecklessness and early boosting of the whole Trump project in 2016 (because they believed he would be easier to beat than the other Republicans) did a lot to set all of this in motion.
itake 23 hours ago [-]
edit: if you're going to down vote, at least explain why my news articles are incorrect.
Are down voters saying Trump/Biden should let the provisions expire?
---
On JCPOA, many of the critical provisions had pending expiration dates by this time [0] [1] and re-negotiation needed to happen again anyways.
Obama kicked the can down the road and Trump/Biden needed to provide the next kick.
[0] - Jan 2026, the limits on the types of centrifuges expire. Jan 2031, quantitative nuclear limits expire (enrichment ceiling).
How is this not a total nonsequitur from the parent thread??
UltraSane 24 hours ago [-]
"he is an avowed Zionist"
What exactly do you mean when you say Zionist?
ryanwhitney 23 hours ago [-]
I believe they're referring to when Joe Biden said "I am a Zionist."
UltraSane 23 hours ago [-]
What did he mean then? Israel exists as a Jewish state so I really don't know what people mean when they say it.
piva00 21 hours ago [-]
Zionism can be both the nationalist movement for making Israel a Jewish state as well as the interpretation that such a movement is inherently colonial and racist.
So Zionism for Israelis might just mean "we support and advocate for a Jewish state in the land of Israel" which also includes two-state solutions but it can mean "we are a colonial and ethno-religious racist state" to the ones being displaced by the movement (like Palestinians).
UltraSane 17 hours ago [-]
Using the same word for two completely different things is very confusing.
Also the Arabs took the land from the Byzantine empire in the 7th century AD.
piva00 15 hours ago [-]
> Also the Arabs took the land from the Byzantine empire in the 7th century AD.
A historical event from 1300 years ago is a bit irrelevant to contemporary issues.
UltraSane 13 hours ago [-]
"A historical event from 1300 years ago is a bit irrelevant to contemporary issues."
1300 years vs 78 years, what is the cutoff?
piva00 11 hours ago [-]
78 years is not that far ago in terms of human generations, the children of the people displaced are still alive, and they've disputed it all the time since then.
Don't understand why you think 78 years is a long time, even less why you think it's equivalent to 1300 years.
UltraSane 7 hours ago [-]
The problem is that you assert 78 years is soon enough for the Palastinian claim to the land to still matter but 1300 years is too long for the Byzantine claim to still matter so we have a paradox of the heap situation where you have to choose a hard cutoff time period after which all claims to land are invalid.
nullsanity 22 hours ago [-]
[dead]
jmyeet 10 hours ago [-]
It's this [1]. From 1986:
> If there were not an Israel, we’d have to invent one
It's lying about working on a ceasefire [2][3]. It's sending more and more weapons to Israel afer October 7, going so far as to split them into up to 100 smaller packages to avoid the need for Congressional approval [4].
Your analysis will be downvoted, but it is absolutely spot on. One day, everyone will always have been against this.
frm88 18 hours ago [-]
One day, everyone will always have been against this
This is a very insightful book, highly recommend.
lovich 24 hours ago [-]
> At any point in the last more than a year of his term, Biden could've ended that conflict with a phone call. He did not because, again, he is an avowed Zionist.
No he could not have. Israel has been a contentious ally for the US, especially while a Democrat has been POTUS because they are actually independently capable of supporting themselves and have their own internal economy and military industrial complex.
The relationship between the United States and Israel started with us(The United States) peeling them off of USSR support in the late 60s[1], and if we abandon them they will either go it on their own or find another ally who has interests in the region due to oil still being important.
Biden as a representative of the United States had leverage over Israel, but not such complete control that he could just call Netanyahu and demand and end the war and have that be done with.
You can argue all day long, but at the end of the day, the US has immense ability to exert pressure on Israel, starting with withholding UNSC vetoes.
The Biden admin pulled no levers whatsoever. On the contrary, it went to great lengths to cover for a genocide that it was aware of. This admin will be part of the history books, but not in a good light :)
lovich 23 hours ago [-]
> ... US has immense ability to exert pressure on Israel, starting with withholding UNSC vetoes.
You are 100% correct on this. That does not however mean they have the ability to end a war in one phone call
> The Biden admin pulled no levers whatsoever.
This is incorrect. Biden tried to constrain Netanyahu and did shit like making the pier to deliver aid to the Palestinians. Netanyahu responded by snubbing Biden and giving a speech to the Senate instead.
I am generally anti Israel as the nation because I believe they have been a shit tier ally who feels free to fuck around in our elections with no remorse, but acting like we had the ability to force them into actions they didn't want, without using military force, is fucking ridiculous.
Again, I think they are a piss poor ally, largely because they will not work with us, and that is largely because they have the ability to operate independently and utilize that ability constantly. If we got rid of any dependence on oil I would say fuck the whole region because every state there is in a competition over who can be the biggest assholes to us, with the possible slight exception of Jordan, and I cage that claim because I only know a decade or two of their history in relations with us and honestly mostly because one of their kings wanted to be in star trek so bad he got a spot as an extra, which implies some level of agreeing with our values.
matwood 21 hours ago [-]
Thank you for your comments. In short, it's complicated. The other piece which you didn't mention that other people bring up is cutting off the 4B-8B in military aid to Israel. In the past that might have given the US more leverage, but Israel has a 700B GDP economy now - they don't need that aid to buy weapons. The aid the US sends just ends up back in the US economy, and keeps Israel from buying arms from China.
Cyph0n 18 hours ago [-]
> In short, it's complicated.
No, it is not. The US has the power to sanction entire states & cut them out from the global banking system overnight. Look at what Cuba has suffered for daring to oppose the US.
> but Israel has a 700B GDP economy now
That would mean shit if the country is sanctioned and its leaders declared persona non grata. South Africa was similarly quite powerful, but when you’re reliant on Western backing and integration, existing as a pariah state is not a sustainable position to be in.
lovich 9 hours ago [-]
Yea, but that’s not a single phone call from the president. I know we’re getting closer and closer to an Imperial Executive every year but we definitely weren’t there under Biden.
Cyph0n 5 hours ago [-]
Let’s just agree to disagree, although we will never know for sure given that Biden is a self-avowed Zionist who chose the path of unconditional support.
jmyeet 14 hours ago [-]
Israel isn't independently capable of doing anything. When Israel was created it was a poor backwater. France and the USSR were early allies. I mean Israel deliberately attacked the USS Liberty and killed ~34 American servicemen in the 1960s. It's widely suspected that Israeli spies or sympathizers stole weapons grade uranium from the US (ie the NUMEC Affair). But this all changed after the Six Day War in 1967 and Israel became an American imperial project to destabilize an oil-rich region, to stop Pan-Arabn Nationalism.
But the history has always been that the US could order Israel to do whatever it wanted from Eistenhower telling Israel to get the hell out of Sinai to Biden telling Israel to knockj it off in Gaza in 2021 [1] and plenty in between (eg US involvement in the Yom Kippur War in 1973 led to Moshe Dayan telling Golda Meir they had to stop because the Americans said so, basically).
The parallel for this is apartheid South Africa. That regime collapsed when it became clear that domestic political pressure was forcing the US to withdraw support. The exact same thing would happen in Israel. Israel gets billions in direct aid and, more importantly, the military is completely dependent on US arms shipments and weapon systems.
If Biden had told Bibi "we're going to stop arms shipments if you don't stop this" it would've ended immediately.
the account is named with throwaway misspelled in the name, he's mocking anyone who interacts with him. Just flag and move on so these assholes don't get more engagement.
kkotak 1 days ago [-]
You're in luck then. Enjoy the ride.
Der_Einzige 1 days ago [-]
If no one had tried to shoot Trump and he stayed as as he was in his first term, he'd be the "sleepy" one. This is an actual quote from Trump circa 2016. His rage at his trial and attempt assassinations gave him 10 extra years of relative energy:
"Look, having nuclear — my uncle was a great professor and scientist and engineer, Dr. John Trump at MIT; good genes, very good genes, OK, very smart, the Wharton School of Finance, very good, very smart — you know, if you're a conservative Republican, if I were a liberal, if, like, OK, if I ran as a liberal Democrat, they would say I'm one of the smartest people anywhere in the world — it's true! — but when you're a conservative Republican they try — oh, do they do a number — that's why I always start off: Went to Wharton, was a good student, went there, went there, did this, built a fortune — you know I have to give my like credentials all the time, because we're a little disadvantaged — but you look at the nuclear deal, the thing that really bothers me — it would have been so easy, and it's not as important as these lives are — nuclear is so powerful; my uncle explained that to me many, many years ago, the power and that was 35 years ago; he would explain the power of what's going to happen and he was right, who would have thought? — but when you look at what's going on with the four prisoners — now it used to be three, now it's four — but when it was three and even now, I would have said it's all in the messenger; fellas, and it is fellas because, you know, they don't, they haven't figured that the women are smarter right now than the men, so, you know, it's gonna take them about another 150 years — but the Persians are great negotiators, the Iranians are great negotiators, so, and they, they just killed, they just killed us, this is horrible."
cjs_ac 24 hours ago [-]
Adding to this, US foreign and military policy is increasingly chaotic, so other countries are quietly disengaging, and tariffs are slowly unravelling the US’ trade relationships. The American people voted for Trump twice: Trumpism is now an established thread in US politics, and the rest of the world is taking steps to insulate itself from the coming turmoil.
I expect that this is mainly due to AI and hardware. The US is about to lose its status as the world’s biggest agricultural exporter to Brazil.
boston_clone 22 hours ago [-]
Wrong metric. We saw a significant drop in _imports_ until the policies were ruled unconstitutional.
eunos 23 hours ago [-]
China should increase the import pace especially after the US strategic reserve depleted.
Considering that despite Chinese saving, US and EU are more interested doing another trade war.
twostorytower 1 days ago [-]
Believe it or not...calls.
lowbloodsugar 24 hours ago [-]
Higher interest rates mean buyers can afford less house for the money. House prices go down. Boomers get mad.
avmich 23 hours ago [-]
You're sure house prices are elastic here?
matwood 23 hours ago [-]
They are slowly elastic. The only way to speed up the re-pricing is a recession where people lose their jobs and are forced to sell. Otherwise, it's mainly young people entering their first house phase that get impacted - which is exactly what we've seen.
23 hours ago [-]
abtinf 23 hours ago [-]
> There are generally two ways of tackling high inflation: with monetary policy (ie raising interest rates) and with fiscal policy (by raising taxes).
While this is the orthodoxy, it should be obvious it is nonsense.
The idea that we must curtail production in order to reduce inflation is so incoherent that it damns the professional court economists who have spread it far and wide.
deepsun 23 hours ago [-]
> This is all being exacerbated by the disastrous war in Iran
No, why? US is an exporter, not importer of oil, so any price increase of crude oil is good for US. Maybe not consumers, but government (Venezuela had literal amine while exporting a lot of oil and honoring all of the international debt payments). So US must have more money to service its international debt.
RealityVoid 23 hours ago [-]
What happens to the local price of oil if you are able to export the oil at a much higher price?
deepsun 14 hours ago [-]
It goes up. E.g. Washington state has a lot of cheap hydroelectricity, but once they started selling it to other states, it's local prices grew up a lot.
But I'm talking about budget deficit: more money in -- easier to service debt.
nonethewiser 23 hours ago [-]
[dead]
enraged_camel 23 hours ago [-]
>> US is an exporter, not importer of oil, so any price increase of crude oil is good for US.
It is good for US oil producers, who have indeed been making money hand over fist exporting oil at a premium. It certainly it not good for anyone else.
deepsun 14 hours ago [-]
Yes, I mentioned literal famine. But I'm talking about budget deficit -- more exports money certainly should help with balance.
The current direction is not going where consumers would want.
Pretty sure Jerome Powell, the previous chair, would have done exactly the same thing. In fact Jerome Powell is still in the Fed and participated in this decision.
None of the applies to Mr. Powell whom the market seems to have put a great deal of trust in
https://www.reuters.com/markets/us/powell-says-tariffs-keepi...
I’ve had quite enough of Trump’s “meritocracy”, personally.
Thanks for the link, hope they figure it out.
Kevin Warsh < Jerome Powell < Janet Yellen
... in terms of credibility as an economist, with Ben Bernanke one step to either side of Powell depending on how much you feel he was a victim of circumstances in the 2008 crisis.
That said, the current problems in the US economy are entirely out of the control of the Fed and all to do with the current administration's policies (mainly the war vs Iran driving commod vol and the on-again off-again trade tariff shuffle driving fx vol) and the long-term deficit position driving rate curve shenanigans. The AI and private credit bubbles are just adding to the anxiety. All of this ultimately feeds into domestic inflation and job market malaise.
The bond market generally doesn't take shit from anyone and it's not surprising to me that bond investors are not impressed. None of that is on Warsh.
Meanwhile, the ECB started raising the rate once the economy stopped crashing. And that promptly caused the second recession in Europe.
We still live under the constraints of our world, and energy availablity is a big one.
It caused the double-dip recession in 2012: https://www.macrotrends.net/global-metrics/countries/euu/eur... and https://www.statista.com/statistics/621489/fluctuation-of-fi...
The actions of the ECB caused at least 10 years of misery for Europe. The 2008 crisis was inevitable, but the US bounced back from it within 2 years. While Europe is _still_ not fully recovered.
Bernanke deserves a lot of credit for that. He was brave enough to ignore the deficit hawks who were screaming about "inflation" and "debasing the dollar".
A lot of that $40T was borrowed at lower interest rates but let's assume for argument's sake that it was borrowed at 5%. That's $2T in interest alone every year. There's a huge difference between adding $2T in debt at 5%+ every year vs 1-3%.
The Fed has auctions to sell its debt. That market clears at a certain interest rate so if the market isn't buying the debt the rate the Fed pays has to go up. That's what's happening here.
What's driving this is that inflation is above the ~2% target. Well above, actually. There are generally two ways of tackling high inflation: with monetary policy (ie raising interest rates) and with fiscal policy (by raising taxes). Modern US administrations (both parties) have completely abandoned any pretense of ever raising taxes. That was the appropriate solution during the inflation shock of 2020-2022. Some European countries did this with a corporate windfall profits tax (eg Spain). The US did not.
The problem is that since housing is such a huge part of consumer spending, higher interest rates mean higher mortgage rates, which means higher housing expenditure, which means higher inflation. Now luckily most mortgages in the US are 30 year fixed so this is slow to respond and only really affects new mortgage. Other countries aren't so lucky.
But the big drivers in inflation are soaring grocery costs and energy costs. Energy costs, particularly diesel, is a massive driver of inflation. The rise in groceries since Covid has completley outpaced inflation while real wages have fallen. There's only so much more inflation the American consumer can take. Household savings rates are already very low so there's very little in the way of a buffer to absorb higher costs.
This is all being exacerbated by the disastrous war in Iran and the war in Ukraine. Russia had been a net exporter of diesel until recently as Ukraine has damaged an estimated 40% of Russian refining capcity. Refineries in the Gulf have also been taken offline. There's been a loss of over 1 million barrels per day in refining capacity. This is somewhat paradoxically why crudel oil prices are relatively low given all that's going on: because crudel oil is mostly useless unless it's refined. Destroy refineries and demand for oil goes down. But the demand for refined petroleum products goes up, way up [1].
It should be noted that China has essentially saved the world economy up to this point [2]. The closure of the Strait of Hormuz blocked the passage of ~20 million barrels per day of crude (plus 20-30% of the world's natural gas plus fertilizer plus helium). The inflation shock of 2020-2022 occurred because we lost "only" 10 million barrels. But China seemingly cut their imports by 5M. Saudi Arabia diverted 5-7 via the East-West pipeline to the Red Sea. The US has been draining the strategic reserve and so net we've only lost a few million barrels per day. That's temporary. the SPR has hit historic lows not seen in 40 years and it can't get much lower without risking a collapse of the salt caverns it's stroed in in Louisiana. Nobody knows if and when that'll happen because we've never done this before.
The backdrop for all this is that there has been a decades-long effort at this point to essentially loot government coffers in the US. More tax cuts for the top 0.01%. The Western world in general has reached a breaking point where land hoarding and wealth need to be taxed or society as we know it will actually break down. I'm not being hyperbolic. Currently, there's no concern for that from the looters because upheaval means war, which means more weapons sales. Also, free movement of capital means the wealthy believe they can just flee.
For context, a mere 10 years ago the US total public debt was ~$16T. It's 2.5x'ed in a decade and only going to get worse unless something drastically changes.
Warsh was put in to cut rates for political purposes. The best he can do is to hold rates steady because they really should go up in an environment where we aren't going to raise taxes.
As for Iran, it's been clear since at least April, that this is an unmistakable and undeniable total strategic defeat for the US and there is no way out other than to surrender. This event will be written about in history books as a turning point in the world order that was designed by the US, for the US after 1945. We are entering a new era. This is going to redefine US relationships all over the world.
[1]: https://rbnenergy.com/market-data/3-2-1-crack-spread
[2]: https://www.theatlantic.com/economy/2026/07/china-iran-usa-o...
In most countries with normal mortgages, raising rates fairly immediately transmits through to the rest of the economy, because it affects the mortgage market. This isn't true in America, because everyone quite reasonably is able to get these insane mortgage products with literally no downside risk - if rates go up, you don't pay more. If they go down, you refinance at minimal cost.
Agree to disagree on the tax issue. The way you've framed it is fairly inflammatory, but happy to have a discussion about it. The reality is that as much money as rich people have, the middle class have a whole lot more. Every country with large government spending has broad, high taxes on the entire population, not just the rich.
Since 1990 the top 1% of wealth holders have seen their share of the wealth increase significantly, almost entirely on the backs of the middle class (and to a lesser extent, the upper-middle class).
The middle/upper middle class may have more collectively than the wealthy, but this is why the middle feels materially poorer and more reactionary than they were 30 years ago. They are being outcompeted in housing (unfairly, by people with vastly more wealth) and are being overcharged and underdelivered on medical care, education and food.
The rich need to be taxed back down to a reasonable share of wealth (<20%) or the politics of the country will continue to be unstable because the masses will continue to vote for change, every election, in search of that outcome.
I earn a reasonable income, but the reality is even though I live alone and don't really think about where I spend my money finances are good. I could quite easily save a fair bit more than I currently do if I wanted to.
My experience won't align with everyone, but it is enough for me to feel somewhat dismissive of people who say life sucks. At some point, if you aren't earning enough and/or spend too much, that's on you. Some of the people I know of who complain about finances feel they should not have to care about their spending, or have "luxuries" that are actually very expensive (going out drinking alcohol is a big one where I'm at). The reality is anything that takes human Labor in a developed economy is very expensive.
We have an affordability crisis. What good would increasing mortgage payments do when housing is one of the biggest single expenses? The point of raising interest rates is to take the economy off the boil, essentially by cutting down on discretionary spending. Grocery prices are up 30%+ since the pandemic. Are people eating too much? Can you eat less? Consumer demand isn't doing that. Various forms of dynamic pricing (eg surveillance pricing) are doing that. The only reason for dynamic pricing to exist is to raise prices.
Beef prices in particular are through the roof and the only reason is price collusion. Meat packers have been sued by states about it. The root cause? AI. They're using the same AI system to set prices so the AI company has access to all the pricing information. That's the 2020s version of collusion. It's the same thing with RealPage and landlords. And something's gotta give. This system is unsustainable.
[1]: https://en.wikipedia.org/wiki/Houses_are_for_living,_not_for...
Also, housing costs don't statically climb as interest rates go up. A decrease in market price makes up for most of the difference.
A very significant amount of American voters believe this. To this day. And their belief in this is still being reinforced by the vast majority of the "mainstream media" which they believe is left-biased, which hasn't been true for very many years at this point.
This is why we are fucked and there is no way out of this that doesn't involve existential threat to our current society.
1. Trump in his first term created the Abraham Accords that directly contributed to the genocide that has since happened (by excluding Palestinians from the process). Biden did not reverse any of that because he is an avowed Zionist;
2. Trump blew up the JCPOA that sought to include Iran in the international community for really no reason than to please his donors, particularly his biggest donors, Sheldon and Miriam Adelson, who are also avowed Zionists. This was an Obama-era deal and part of me is convinced that Trump blew it up simply because it had Obama's name on it. Biden of course did not reinstate it;
3. Trump blew up energy markets in 2020 with the disastrous OPEC deal he made in June that created the inflation shock of Covid. Biden quietly went to MBS to get him to increase oil output. He refused. Biden said nothing. He absolutely could've waved a very big stick to get MBS to change course here, notably by threatening arms shipments; and
4. The so-called "bear-hug strategy" following October 7 set the stage for everything that's happening now. At any point in the last more than a year of his term, Biden could've ended that conflict with a phone call. He did not because, again, he is an avowed Zionist. That both emboldened Israel to drag the US into the Iran war and also was a key factor in the Democrats losing the 2024 presidential election although I'm not actually convinced we'd be in a vastly different situation had Kamala won (eg [1]).
US foreign policy is surprisingly uniparty.
Oil is good for business because it's good for war. It's also why we don't have major investment in renewables. As this article put it, nobody goes to war over a solar panel [2].
[1]: https://www.aljazeera.com/news/2024/10/8/kamala-harris-says-...
[2]: https://www.theenergymix.com/no-one-goes-to-war-over-a-solar...
Not everything is a simple ctrl-z, and the blame lays squarely on who implemented it.
There are a lot of people that do not know what to do.
There are also wounds that you can't really do anything about without hospital. (internal bleeding?!)
The funny thing is, as analogies go, here the friend tells you to bugger off because of israel and tells the mugger to come back and help him... mugger stabs him some more
"stuck in the past" vibes vs making progress
I've voted democrat in every election since I was 18.
As an example, take the current Iran war. There's very little opposition in establishment politics to the actual war. What you get instead are process objections, such as the president not consulting Congress. Objecting to the process is a way of appearing to be in opposition without being in opposition.
This was ultimately why Kamala Harris lost the 2024 election. "Trump bad" isn't a platform that people get excited for. People are asking "what are you going to do about it?" and her answer was... nothing. It was the culmination of years of what's been called "lesser evil voting" or "harm reduction voting". Democrats have adopted a platform of just not being quite as bad as the Republicans, probably because they have the exact same donors. And millions of voters stayed home in 2024 rather than vote for the status quo.
So back to the JCPOA, Biden should've done something but did nothing. Because he likes what Trump did. He agrees with it. And so do most Democrats. That's the point.
[1]: https://en.wikipedia.org/wiki/Ratchet_effect
[2]: https://ia800503.us.archive.org/5/items/mirage-of-dissent-th...
Biden did a pretty good job cleaning up after Trump. Was he perfect? Not even close. But Dem primary voters had the option of more progressive candidates and instead they circled around Biden. Did donors try and engineer a Biden win? Sure. Were voters obligated to go along with their scheme? Also no.
The blame for our situations rests squarely on the shoulders of the American people, who have been living so insulated from the consequences of their votes that they entertained a guy like Trump, twice.
Republicans like the filibuster because they can force through most of what they want under reconciliation, which only requires a simply majority, and they can block Democrats with a minority. Democrats like the filibuster because it gives them an excuse to do nothing. Because a lot of what Democrats want to do isn't filibuster-proof.
Also, the filibuster once meant that you had to stand up and hold the floor to block a vote. Now we have a silent hold since the 1970s. If you for some reason believe in needing 60 votes to end debate, why not at least adopt the earlier interpretation that requires someone to stand at a podium? Because Democrats don't want to do anything. That's why.
Biden had four terrible decisions in his presidency:
1. Appointing Merrick Garland as AG. He's another establishment Democrat that didn't want to do anything, really, particularly not prosecute the insurrection that took place. He was embarrassed into doing so by the January 6 Committee. He basically lost 2 years of potentially prosecuting the administration;
2. His Israel policy, particularly the bear hug strategy and especially not ending the genocide;
3. Not raking MBS over the coals for not ending the Trump 2020 OPEC deal, wich exacerbated the inflation price shock; and
4. Running for re-election.
It's worth adding that the only reason Biden was the candidate was because the DNC was scared Bernie Sanders would be the candidate so they fixed the race in South Carolina thanks to Jim Clyburn in particular. Everyone dropped out of the primary and got rewarded with Cabinet posts, etc (eg Pete Buttigief as DoT Secretary). Except one. Elizabeth Warren stayed in to split Bernie's vote.
As for blaming the voters, I 100% disagree. The party leadership has repeatedly engineered situations to give the voters terrible choices and rely on lesser evil voting. After the 2017 election, the DNC got sued and argued in court that they had no obligation to stay neutral. That was a political promise not a binding promise. Basically, they argued that they were free to overrule the will of primary voters with superdelegates and manipualting of funds by then DNC Chair Debbie Wasserman Schultz, who when exposed and was forced out, just went and joined the Hilary campaign.
Voters stayed home in the millions in 2024 (vs 2020) because they were given no choice. They're not responsible for that. The candidate is. And if you end up being angry about Kamala losing, blame her for having a terrible platform, not the voters who decided a slightly better candidate was the only available choice.
> Trump blew up the JCPOA that sought to include Iran in the international community for really no reason than to please his donors Indeed, a few of the US allies in the Middle East, like the UAE, Saudi Arabia, as well as Bahrain, expressed concerns over the Iran nuclear deal[2].
We are entering a critical point in time, where Western civilization may not dominate the world anymore like it did for the past 300 years. There will be a lot of instability, though a lot of people fail to recognize that and are underprepared.
[1] https://www.twz.com/air/gbu-57-massive-ordnance-penetrator-s... [2] https://www.aljazeera.com/news/2018/5/9/world-leaders-react-...
I think Biden did manage to enact some good domestic economic policy in a tough political environment, but in addition to everything you pointed out that I agree with he obviously should have stepped aside for the 2024 election long before he did and his decision to nominate Merrick Garland for Attorney General will be seen as one of those history book moments of very high consequence in the fall of an empire (assuming we have legitimate history books in this future).
Plenty of blame to go around for many Democrats here for both the fact that our disastrous foreign policy is, as you've said, uniparty, and also their fecklessness and early boosting of the whole Trump project in 2016 (because they believed he would be easier to beat than the other Republicans) did a lot to set all of this in motion.
Are down voters saying Trump/Biden should let the provisions expire?
---
On JCPOA, many of the critical provisions had pending expiration dates by this time [0] [1] and re-negotiation needed to happen again anyways.
Obama kicked the can down the road and Trump/Biden needed to provide the next kick.
[0] - Jan 2026, the limits on the types of centrifuges expire. Jan 2031, quantitative nuclear limits expire (enrichment ceiling).
[1] - https://www.armscontrol.org/act/2017-10/news/iran-nuclear-de...
What exactly do you mean when you say Zionist?
So Zionism for Israelis might just mean "we support and advocate for a Jewish state in the land of Israel" which also includes two-state solutions but it can mean "we are a colonial and ethno-religious racist state" to the ones being displaced by the movement (like Palestinians).
Also the Arabs took the land from the Byzantine empire in the 7th century AD.
A historical event from 1300 years ago is a bit irrelevant to contemporary issues.
1300 years vs 78 years, what is the cutoff?
Don't understand why you think 78 years is a long time, even less why you think it's equivalent to 1300 years.
> If there were not an Israel, we’d have to invent one
It's lying about working on a ceasefire [2][3]. It's sending more and more weapons to Israel afer October 7, going so far as to split them into up to 100 smaller packages to avoid the need for Congressional approval [4].
[1]: https://www.youtube.com/shorts/2HZs-v0PR44
[2]: https://internationalpolicy.org/publications/the-biden-admin...
[3]: https://truthout.org/articles/former-top-biden-spox-admits-i...
[4]: https://www.timesofisrael.com/report-us-quietly-approved-mor...
This is a very insightful book, highly recommend.
No he could not have. Israel has been a contentious ally for the US, especially while a Democrat has been POTUS because they are actually independently capable of supporting themselves and have their own internal economy and military industrial complex.
The relationship between the United States and Israel started with us(The United States) peeling them off of USSR support in the late 60s[1], and if we abandon them they will either go it on their own or find another ally who has interests in the region due to oil still being important.
Biden as a representative of the United States had leverage over Israel, but not such complete control that he could just call Netanyahu and demand and end the war and have that be done with.
And that's not even getting into whatever the fuck you mean by " ... he is an avowed Zionist" [1]https://en.wikipedia.org/wiki/Soviet_Union_and_the_Arab%E2%8...
The Biden admin pulled no levers whatsoever. On the contrary, it went to great lengths to cover for a genocide that it was aware of. This admin will be part of the history books, but not in a good light :)
You are 100% correct on this. That does not however mean they have the ability to end a war in one phone call
> The Biden admin pulled no levers whatsoever.
This is incorrect. Biden tried to constrain Netanyahu and did shit like making the pier to deliver aid to the Palestinians. Netanyahu responded by snubbing Biden and giving a speech to the Senate instead.
I am generally anti Israel as the nation because I believe they have been a shit tier ally who feels free to fuck around in our elections with no remorse, but acting like we had the ability to force them into actions they didn't want, without using military force, is fucking ridiculous.
Again, I think they are a piss poor ally, largely because they will not work with us, and that is largely because they have the ability to operate independently and utilize that ability constantly. If we got rid of any dependence on oil I would say fuck the whole region because every state there is in a competition over who can be the biggest assholes to us, with the possible slight exception of Jordan, and I cage that claim because I only know a decade or two of their history in relations with us and honestly mostly because one of their kings wanted to be in star trek so bad he got a spot as an extra, which implies some level of agreeing with our values.
No, it is not. The US has the power to sanction entire states & cut them out from the global banking system overnight. Look at what Cuba has suffered for daring to oppose the US.
> but Israel has a 700B GDP economy now
That would mean shit if the country is sanctioned and its leaders declared persona non grata. South Africa was similarly quite powerful, but when you’re reliant on Western backing and integration, existing as a pariah state is not a sustainable position to be in.
But the history has always been that the US could order Israel to do whatever it wanted from Eistenhower telling Israel to get the hell out of Sinai to Biden telling Israel to knockj it off in Gaza in 2021 [1] and plenty in between (eg US involvement in the Yom Kippur War in 1973 led to Moshe Dayan telling Golda Meir they had to stop because the Americans said so, basically).
The parallel for this is apartheid South Africa. That regime collapsed when it became clear that domestic political pressure was forcing the US to withdraw support. The exact same thing would happen in Israel. Israel gets billions in direct aid and, more importantly, the military is completely dependent on US arms shipments and weapon systems.
If Biden had told Bibi "we're going to stop arms shipments if you don't stop this" it would've ended immediately.
[1]: https://www.cnbc.com/2021/05/19/biden-tells-israels-netanyah...
"Look, having nuclear — my uncle was a great professor and scientist and engineer, Dr. John Trump at MIT; good genes, very good genes, OK, very smart, the Wharton School of Finance, very good, very smart — you know, if you're a conservative Republican, if I were a liberal, if, like, OK, if I ran as a liberal Democrat, they would say I'm one of the smartest people anywhere in the world — it's true! — but when you're a conservative Republican they try — oh, do they do a number — that's why I always start off: Went to Wharton, was a good student, went there, went there, did this, built a fortune — you know I have to give my like credentials all the time, because we're a little disadvantaged — but you look at the nuclear deal, the thing that really bothers me — it would have been so easy, and it's not as important as these lives are — nuclear is so powerful; my uncle explained that to me many, many years ago, the power and that was 35 years ago; he would explain the power of what's going to happen and he was right, who would have thought? — but when you look at what's going on with the four prisoners — now it used to be three, now it's four — but when it was three and even now, I would have said it's all in the messenger; fellas, and it is fellas because, you know, they don't, they haven't figured that the women are smarter right now than the men, so, you know, it's gonna take them about another 150 years — but the Persians are great negotiators, the Iranians are great negotiators, so, and they, they just killed, they just killed us, this is horrible."
While this is the orthodoxy, it should be obvious it is nonsense.
The idea that we must curtail production in order to reduce inflation is so incoherent that it damns the professional court economists who have spread it far and wide.
No, why? US is an exporter, not importer of oil, so any price increase of crude oil is good for US. Maybe not consumers, but government (Venezuela had literal amine while exporting a lot of oil and honoring all of the international debt payments). So US must have more money to service its international debt.
But I'm talking about budget deficit: more money in -- easier to service debt.
It is good for US oil producers, who have indeed been making money hand over fist exporting oil at a premium. It certainly it not good for anyone else.