http://ap.google.com/…

President Raul Castro warned Cubans on Friday to prepare for a “realistic” brand of communism that is economically viable and does away with excessive state subsidies designed to promote equality on the island.

Addressing Cuba’s parliament in its first session since lawmakers selected him to succeed his older brother Fidel in February, Raul Castro announced no major reforms, but suggested that global economic turbulence could lead to further belt-tightening on the island.

“Socialism means social justice and equality, but equality of rights, of opportunities, not of income,” the 77-year-old president said in a speech that was taped and later aired on national television. “Equality is not egalitarianism.”

That sentiment marks a break with his brother, who spent decades saying Cuba was building an egalitarian society. But the new president nevertheless ended by proclaiming he had “learned everything” from Fidel, drawing a standing ovation.

Since succeeding his brother, Raul Castro has authorized Cubans to legally purchase computers, stay in luxury hotels and obtain cell phones in their own names. His government has raised some salaries and done away with wage limits, allowing state workers to earn more for better performance.

Cuba’s rubber-stamp parliament convenes for only for a few hours twice a year and rumors were rampant that Friday’s session would see an easing of restrictions on travel abroad or a strengthening of wages by increasing the value of the peso, worth about 21-1 against the U.S. dollar.

The government controls well over 90 percent of the economy and the average salary is just 408 pesos per month, US$19.50, though most Cubans get free housing, health care, education and ration cards that cover basic food needs.

Castro said that in “the matter of salaries, we’d all like to go faster, but it’s necessary for us to act with realism.”

“The situation could even get worse,” he said of the global economy. “We will continue to do what’s within our reach so that a series of adversities have less effect on our people, but some impact is inevitable in certain products and sectors.”

Economy Minister Jose Luis Rodriguez said this week that skyrocketing global food and oil prices would cause “inevitable adjustments and restrictions” for Cuba’s economy.

Castro said he supported a proposal to gradually push back the retirement age five years, to 65 for men and 60 for women. The move, which parliament plans to vote on in December, is part of an effort to soften the blow of a disproportionately elderly work force.

Castro acknowledged shortages that plague Cubans, but said “we have to be conscious that each increase in salary that is approved or price that is subsidized adhere to economic reality.”

He also shot back at U.S. officials who have dismissed the small changes he has overseen in Cuba as meaningless.

“Faced with the measures adopted lately in our country, some official in the United States comes out immediately, from a spokesman to the president, to brand them ‘insufficient’ or ‘cosmetic,’” Castro said. “Although no one here asked their opinion, I reiterate that we will never make any decision, not even the smallest one, as a result of pressure or blackmail.”

For the fourth straight parliamentary session, Raul Castro sat next to an empty chair set aside for his ailing brother.

The elder Castro, who turns 82 next month, has not been seen in public since undergoing emergency intestinal surgery in July 2006.

Interesting indeed.

http://www.fortbendnow.com/…

In the face of $4 per gallon gasoline and predictions the price will rise to $7 by the end of summer, Congressman Ron Paul (R-Lake Jackson) is calling on Congress to explore how the weakened value of the dollar may be contributing to the rise in oil prices.

Paul, whose 14th Congressional District of Texas includes part of the Katy area and much of Cinco Ranch, said he wants Congress to hold hearings on the relationship between the falling value of the dollar and the recent rise of oil prices.

As ranking member of the House Subcommittee on Domestic and International Monetary Policy, Paul sent a letter earlier this week to Rep. Barney Frank (D-Mass.), chairman of the House Financial Services committee, asking for the hearings.

“The price of oil is currently among the most pressing issues to American workers,” Paul said. “Congress should be examining all factors contributing to the high cost of oil, and monetary policy is one of the key factors in the run-up in price.”

Paul’s letter pointed out that the price of oil in dollars has risen 39 percent this year. Oil in Euros has only risen 30 percent, resulting in degraded purchasing power of the dollar of at least 80 cents of the increased price of a gallon of gas.

“Neither the Federal Reserve nor the Treasury Department have been willing to take responsibility for the dollar’s slide over the past several years, while American consumers have been forced to pay continually higher prices for gasoline, heating oil and numerous other imported products upon which Americans depend,” Paul noted in his letter. “American consumers cannot afford to allow continued lax Congressional oversight of the Federal Reserve and the Treasury Department’s duties as stewards of the dollar, especially since the dollar is a major factor in the skyrocketing price of oil.”

Besides himself, 16 other Members of Congress signed on to the letter, including ranking member of the House Committee on Financial Services Spencer Bachus, and Chairman of the Republican Study Committee, Rep. Jeb Hensarling.

Hopefully DownsizeDC will get something going on this. If anything this could be an educational tool for those who would be participating. The more congress critters who understand economics, even a little bit, the better.

http://www.cato-at-liberty.org/…

Politicians who blame “speculators” in futures markets for the run up in oil prices — such as Sen. Byron Dorgan (D-N.D.) writing in this morning’s USAToday — should consider a lesson from the lowly onion.

Onions are one of the few commodities in the United States for which there are no futures markets, according to an item published Friday in Fortune magazine. (Futures markets allow the sale of commodities for set prices at future dates.) It seems that in the late 1950s domestic onion producers blamed those same speculators in futures markets for driving onion prices DOWN. They successfully lobbied Congress to ban all futures trading in onions, a ban that is still in place a half century later.

So has the absence of futures-market speculation kept onion prices low and stable? Quite the contrary. According to Fortune:

And yet even with no traders to blame, the volatility in onion prices makes the swings in oil and corn look tame, reinforcing academics’ belief that futures trading diminishes extreme price swings. Since 2006, oil prices have risen 100%, and corn is up 300%. But onion prices soared 400% between October 2006 and April 2007, when weather reduced crops, according to the U.S. Department of Agriculture, only to crash 96% by March 2008 on overproduction and then rebound 300% by this past April.

Sen. Dorgan and his allies will need to find someone else to blame for volitale and rising oil prices.

Isn’t this what serious economists, especially the Austrians, have been saying for perhaps 100+ years yet the politicians continue to use speculators as the scapegoat for many of the problems they instigated.

Record prices have prompted a slew of bills to curtail the role of investors, but traders say they could backfire:

NEW YORK (CNNMoney.com) — Fed up with soaring oil prices and a chorus of people blaming Wall Street speculators, Congress is considering a host of rules aimed at limiting the inflow of investor money into oil contracts.

But oil traders urge caution. While more disclosure is a good thing, they say making it harder for speculators to invest in oil futures could have the opposite effect intended, and send prices higher.

In light of oil’s phenomenal climb from under $50 a barrel to nearly $140 in less than 18 months - and the public belief that Wall Street traders were behind the rise - Congress is awash in bills that attempt to limit the role of speculators. Several have bipartisan support and could soon become law.

“In two days, the price of oil rose $16,” said Sen. Richard Durbin, D-Ill., at a joint hearing of two Senate panels on oil speculation Tuesday. “Did I miss something, was there some war in the Middle East?”

Read More…

http://thirdpartywatch.com/…

Green Party candidates like Cynthia McKinney, Jesse Johnson, Kent Mesplay, and Katherine “Kat” Swift offer positive solutions.The British are paying $8 dollars a gallon for gas. Goldman Sachs predicts Americans will be paying $6 a gallon next year.

Green Party candidates positive solutions. “More Trains, Less Traffic”. Build modern high speed rail across America. New High Speed rail in the intersate corridors, and light rail in communities to cut dependance on foreign oil in half. Stop wanton waste of $1 Trillion tax dollars on foriegn military misadventure. Stop the deficit spending that has brought a weaking dollar, and inflated prices. Seek political solutions for political problems. Use tax savings to balance annual $3.1 trillion federal budget, pay off $9.4 Trillion federal debt, install auditable accounting system at pentagon. Build rail with tax savings.

Kent Mesplay, ” Cut out tax payer funded oil, auto, aspault subsidies”.

Columist Charles Krauthammer wrote in the Washington Post this week. “Tax the damn thing.”

“Why have the extra $2 dollars (above the current $4) go abroad? Have it go to the U.S. Treasury as a gas tax.” To pay off the federal debt and strengthen the U.S. economy. Force conservation.

Announce a schedule of gas tax hikes of 50 cents every six months for the next two years. And put a tax floor under $4 gasoline, so that as high gas prices transform the U.S.auto fleet, change driving habits, and hugely reduce U.S. oil demand and bring down world oil prices .. the American consumer and American economy reap all the benefits”.

Don’t know if the spelling mistakes are in the original press release but I’d hope not. Couldn’t find this release on their website so I’m not sure of the source. I’m interested in the economic theory behind this along with the constitutional validation. I have a feeling the former would be overly simplistic and the latter based on the fallacious living document theory. I’m not entirely sure I understand the tax floor at $4/gallon of gas. Does that mean if prices drop the tax will become a greater percentage or the retail price? Does that imply that they will raise the tax as the gas price increases in order to at least keep the percentage the same? How will this light rail work in the nonmetropolitian areas where at least 1/6th of the population lives in? I know that where I grew up buses and light rail would be almost completely useless. Where is the justification for taxing those individuals who happen to live in rural areas where these services won’t ever reach? Will anyone acknowledge that the unconstitutional interstate highway system very likely was a major component of our current situation? Are the people advocating this claimed solution claiming that this government intervention will be different because it’d be done “right” by the “correct” people unlike the very consistent string of “wrong” individuals prior? What do they propose to do for those who couldn’t afford artificially inflated $6/gallon gasoline?