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The fundamental problem that much of the world faces today is that investors are overreacting to debt-to-GDP ratios, fearful of some magic threshold, and demanding fiscal-austerity programs too soon. They are asking governments to cut expenditure while their economies are still vulnerable. Households are running scared, so they cut expenditures as well, and businesses are being dissuaded from borrowing to finance capital expenditures. The lesson is simple: We should worry less about debt ratios and thresholds, and more about our inability to see these indicators for the artificial - and often irrelevant - constructs that they are.

The Dow Jones average suffered its latest calamitous decline on Thursday, plunging 419 points and erasing much of the progress that had been made after the last series of wild swings two weeks ago. There were many factors at work in Thursday's carnage, which came after markets in Asia and Europe experienced similar turmoil, but the overriding one seems to be this: Just about everyone now believes the U.S. economy is getting worse -- and no one thinks our leaders in Washington are about to do anything meaningful about it. So we thought it might be a good time to take a step back and consider the fundamental absurdity of the paralysis in Washington, where spending cuts and deficit reduction -- and not job creation -- have come to define and dominate the discussion. And who better to illustrate this than ... Robert Reich, playing the roles of both Professor Donald Right and Dr. Hugo Wrong in a one-man show that everyone on Capitol Hill really ought to check out:

Austerity is inflicting vast pain now, and killing our future, too.

The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government-a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises. If the IMF's staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform. And if we are to prevent a true depression, we're running out of time.

It is not democracy that keeps western nations at war, but armies and the interests now massed behind them. The greatest speech about modern defence was made in 1961 by the US president Eisenhower. He was no leftwinger, but a former general and conservative Republican. Looking back over his time in office, his farewell message to America was a simple warning against the "disastrous rise of misplaced power" of a military-industrial complex with "unwarranted influence on government". A burgeoning defence establishment, backed by large corporate interests, would one day employ so many people as to corrupt the political system. (His original draft even referred to a "military-industrial-congressional complex".) This lobby, said Eisenhower, could become so huge as to "endanger our liberties and democratic processes".

Greece faces unacceptable conditions for a new bailout. If it defaults, the US had better be ready for the economic shock. The European authorities are playing a dangerous game of "chicken" with Greece right now. It is overdue for US members of Congress to exercise some oversight as to what our government's role is in this process, and how we might be preparing for a Greek debt default. Depending on how it happens, this default could have serious repercussions for the international financial system, the US economy and, indeed, the world economy.

It's important, yes, and must be addressed. But by a wide margin, it's not the nation's most pressing economic problem. That would be the widespread and persistent joblessness that has plagued the labor market since the Great Recession began in 2008. Almost 14 million people - 9.1 percent of the labor force - were officially counted as unemployed last month. But that's just the tip of the iceberg. There were almost 9 million part-time workers who wanted, but couldn't find, full-time jobs; 28 million in jobs they would have quit under normal conditions; and an additional 2.2 million who wanted work but couldn't find any and dropped out of the labor force. If the economy could generate jobs at the median wage for even half of these people, national income would grow by more than 10 times the total interest cost of the 2011 deficit (which was less than $40 billion). So anyone who says that reducing the deficit is more urgent than reducing unemployment is saying, in effect, that we should burn hundreds of billions of dollars worth of goods and services in a national bonfire. We ought to be tackling both problems at once. But in today's fractious political climate, many promising dual-purpose remedies - like infrastructure investments that would generate large and rapid returns - are called unthinkable, in the false belief that they would impoverish our grandchildren. Yet there are other ways to attack unemployment that could garner bipartisan support. Perhaps the most promising is a payroll tax holiday.

from the Great Transformation of 1954 to the Arab Spring and the three economic falsehoods that can destroy our civilization.

So, yes, we face a threat to our capitalist system. But it's not coming from half-naked anarchists manning the barricades at Occupy Wall Street protests. Rather, it comes from pinstriped apologists for a financial system that glides along without enough of the discipline of failure and that produces soaring inequality, socialist bank bailouts and unaccountable executives. It's time to take the crony out of capitalism, right here at home.

Glenn Greenwald studied law and spent ten years as a litigator in federal and state courts across the country. Now he's a big two-fisted progressive blogger and columnist for Salon.com. And he's out with a blistering critique of what has happened to American law. We've stopped applying it to everyone, says Greenwald. We've carved out an exemption for Americans in the halls of power. We've created what Greenwald calls a "lawless elite" that is running roughshod over our economy and national policy. Over American law. This hour On Point: Glenn Greenwald, and liberty and justice for some.

It was neither tax evaders in Greece nor hedge funds that caused Europe's existential crisis -- political leaders in the euro zone share a great deal of the responsibility. They have been either unwilling or incapable of doing their jobs.

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