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Generational Dynamics Web Log for 23-Jun-2010
23-Jun-10 News -- Kurdish terrorists bomb bus in Istanbul, Turkey

Web Log - June, 2010

23-Jun-10 News -- Kurdish terrorists bomb bus in Istanbul, Turkey

US budget deficit continues its climb to infinity

Kurdish terrorists kill 5 in Istanbul bombing

Turkey (Source: CIA Fact Book)

Turkey (Source: CIA Fact Book)

The Kurdistan Freedom Falcons (TAK), an offshoot of the terrorist Kurdistan Workers' Party (PKK), claimed responsibility for blowing up a military bus in Istanbul, the nation's largest city, killing several soldiers and a 17 year old girl, according to Zaman.

Furious Erdogan blames the media for giving support to terrorist organizations like the PKK. (Source: Hurriyet)

Furious Erdogan blames the media for giving support to terrorist organizations like the PKK. (Source: Hurriyet)

This comes after last weekend's PKK terrorist attack on a Turkish military unit near the Iraq border, killing 11, and "sending shockwaves across the nation." (See "22-Jun-10 News -- Turkey masses troops on Iraq border.")

The new attack brings to an end the unofficial truce between the PKK and the government, based on an initiative launched last year by Prime Minister Recep Tayyip Erdogan, according to the London Independent.

After Saturday's attack Erdogan vowed to "annihilate" the PKK and promised that they would "drown in their own blood." The Istanbul attack infuriated Erdogan, according to Hurriyet. Speaking at a meeting of officials from his own political party, the Justice and Development Party, or AKP, he criticized the images of grieving mothers on television, calling them propaganda that will serve terrorists. "I beg your pardon," he said, "but unfortunately the media is intentionally or unintentionally supporting the terrorist organization in a serious way. I am being this harsh."

I can't get over the irony of this situation, coming so soon after Erdogan condemned Israel for the Gaza blockade to prevent exactly this kind of terrorist attack on Israel. This must be another example of Karmic revenge.

US budget deficit continues its climb to infinity

Budget deficit (Source: heritage.org)

Budget deficit (Source: heritage.org)

Congressional Budget Office figures indicate that the government deficit will continue to be much larger than the Administration anticipated. This chart from the Heritage Foundation web site is based on Administration and CBO figures.

In many ways, the whole right side of this graph is a laugh. They really don't have any idea what the deficit will be next year, let alone in 2020. These numbers are all total guesses, based on fantasy assumptions.

If you look at the left side of the graph, you can see what I've said many times before: the deficit up till now has nothing to do with the Iraq war; it's mostly related to tax collections. The surplus that occurred for a couple of years in the late 90s was a result of the dot-com bubble. The subsequent deficit occurred because the dot-com bubble crashed. The deficit shrank again from 2004-2007 because of the real estate and credit bubbles. The deficit has soared since 2007 because of the credit crunch / financial crisis.

So now the projected deficit for 2010 is an astronomical $1.5 trillion, much higher than estimated in the past. This is because tax revenues are down and because of the unprecedented costs of the stimulus and bailout programs. But the graph shows that the deficit decreases in the next four years. How do they reach that conclusion? They reach it based on the assumption that the economy is going to go through a "V-shaped recovery" -- meaning that the credit bubble is going to grow again, leading to a big increase in tax revenues. As regular readers of this web site know, that's not going to happen.

Why did the CBO find that the projected deficit is going to increase from 2015 to 2020? That's because Obama's health plan kicks in. Remember the claims that Obama's health plan was supposed to save money? Well, that was a joke on all of us. It turns out that business health insurance costs are going to go through the roof, with the result that they'll cancel their health insurance plans altogether, pushing most employees onto the subsidized government-sponsored health plans. This will cost huge amounts of money, resulting in the increased projected deficits.

In September of last year, I called Obama's health care bill a proposal of economic insanity, and nothing has happened to change my mind.

In 2008, I posted the article "One, Two, Three ... Infinity," in which I compared to the ever-increasing government spending plans to a book by George Gamow that I read in school in the 1950s. My use of that particular phrase was to convey the idea that debt was on an exponential growth path that would not be stopped except by a major financial collapse and crisis. That hasn't changed either.

McChrystal on the carpet

Stanley McChrystal, Obama's top commander in Afghanistan, might be fired on Wednesday, after he meets with President Obama in Washington to explain his remarks to the author of an article in Rolling Stone magazine.

The remarks really aren't so bad, but they're taken out of context and are made to appear to be disrespectful of the President. Thus, McChrystal might get fired.

On the other hand, the entire Afghanistan counter-insurgency strategy was developed by McChrystal, so he's the best person to continue leading the effort. Thus, the President may decide to magnimously forgive McChrystal and send him back to Afghanistan.

For what it's my worth, my reading of the situation is that McChrystal wouldn't mind being fired because he's come to realize that the counter-insurgency strategy is not going to work. (See "20-Jun-10 News -- UN reports 'alarming' rise in Afghan violence.") We'll see.

Additional links

Israeli officials are criticizing Jerusalem municipal officials for plans to go ahead with the demolition of 22 Palestinian Arab homes to make way for an archeological park and apartment buildings. It's feared that the demolition will torpedo the "proximity" peace talks between Israel and the Palestinians, as if the talks have a chance anyway. NY Times

North Korean president Kim Jong-il is being duped by his subordinates, including his own son Kim Jong-un, because they don't want to let him know how desperate the North Korean economy is. JoongAng

As if to prove the above point, check out this story and photo of Kim Jong-il inspecting a radish. Telegraph

Former president George W Bush spoke at a Tuesday prayer meeting in Seoul, South Korea, to 60,000 people. He criticized North Korean president Kim Jong-il for wasting "North Korea's precious few resources on personal luxuries and nuclear weapons programs." AFP

In Beijing, China, many women won't marry a man who doesn't own a home. And with high prices from the real estate bubble, a lot of men are getting dumped. LA Times

At the tennis championships in Wimbledon, England, the skirts are shorter and hotter than ever this year. Some nice photos. Daily Mail

The top ten worst BP gaffes in the saga of the Gulf of Mexico oil spill. CS Monitor

(Comments: For reader comments, questions and discussion, see the 23-Jun-10 News -- Kurdish terrorists bomb bus in Istanbul, Turkey thread of the Generational Dynamics forum. Comments may be posted anonymously.) (23-Jun-2010) Permanent Link
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Generational Dynamics Web Log for 23-Jun-2010 23-Jun-10 News -- Kurdish terrorists bomb bus in Istanbul, Turkey

Kurdish terrorists kill 5 in Istanbul bombing

US budget deficit continues its climb to infinity

McChrystal on the carpet

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Generational Dynamics Web Log for 23-Jun-2010
23-Jun-10 News -- Kurdish terrorists bomb bus in Istanbul, Turkey