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Corporatist Corruption:
Systemic Fraud under Clinton-Bush-Obama Regime

Crony capitalism and the elimination of accountability

News Corporatism Recommended Links Casino Capitalism Neoliberalism as a New Form of Corporatism Control Fraud
 (crisis of corporate governance)
Hillary Clinton email scandal: Timeline and summary "Clinton Cash" Scandal: Hillary Clinton links to foreign donors and financial industry Bill Clinton, the man who sold Democratic Party to Wall Street and helped FIRE sector to convert the country into casino Audatioues Oligarchy and Loss of Trust Propaganda of Shareholder Value  Amorality and criminality of neoliberal elite
Deregulation as crony capitalism Revolving Doors as Corruption Brooksley Born and Three Marketeers Lack of transparency, problems with following GAAP standards Principal-agent problem Revolving Doors as Corruption
Corruption of Regulators Corruption at the SEC Corruption of FED Corruption of Treasury Corruption of Congress John Dugan and the corruption of Office of Comptroller of currency
Neoclassical Pseudo Theories and Crooked and Bought Economists Financial Sector Induced Systemic Instability of Economy America’s Financial Oligarchy Banking Bonuses as Money Laundering Numbers racket Wrecking Crew: Notes on Republican Economic Policy
Quiet coup Neoliberalism as secular religion, "idolatry of money" Pope Francis on danger of neoliberalism The Great Transformation Kleptocracy Wall Street Propaganda Machine
Credibility Trap Privatization as a special case of corruption        
Think Tanks Enablers The Maestro Has No Clothes Glass-Steagall repeal Phil Gramm Financial Humor Etc

"At its heart, therefore, the financial crisis was a breakdown in the rule of law in America."

-- James Galbraith

In philosophical, theological, or moral discussions, corruption is spiritual or moral impurity or deviation from an ideal. Corruption may include many activities including bribery and embezzlement. Government, or 'political', corruption occurs when an office-holder or other governmental employee acts in an official capacity for personal gain.

https://en.wikipedia.org/wiki/Corruption

Systemic fraud was the second nature of corporatist regimes from its humble beginning in the first half of the XX century in Mussolini Italy to reincarnation of corporatism by Reagan. In this sense the terms corporatism and the term crony capitalism reflect the same social phenomenon. Both means the elimination of accountability. And first and foremost elimination of accountability for the financial sector, as fish rots from the top. According to Wikipedia corruption occurred on several different scales:

Scales of corruption

Corruption can occur on different scales. There is corruption that occurs as small favors between a small number of people (petty corruption), corruption that affects the government on a large scale (grand corruption), and corruption that is so prevalent that it is part of the every day structure of society, including corruption as one of the symptoms of organized crime (systemic corruption).

Wikipedia conveniently omitted neoliberalism as the source of system corruption.  At a deeper level it is corruption that form the backbone to globalization. As neoliberal regimes enforce deregulation, privatization, and structural adjustment policies, requiring civil service to shrink, the side effect of externality of this policies is outflow of money iether to G7 countries (for the third worlds) or to offshore jurisdictions (for the USA and other G7 countries). While Western governments, the World Bank and IMF denounce corruption, their own policies promote it on a systemic level. 

Like Mussolini used to say (or was it attributed to him) the essence of corporatism is  to [corporate] friends everything, to enemies the law. And that's the essence of Clinton-Bush-Obama regime if we are talking about high level executives. Small fish still can be fried, but big sharks are untouchable. No executives went to jail after 2008 financial crisis. No executives went to jail due to deception of people before Iraq war or due to incompetence or worse during 9/11. 

Mussolini claimed that by elimination of accountability the dynamic (or heroic) capitalism based on private initiative could be prevented from degenerating into stale crony capitalism.  But opposite is actually true. There is a short initial period when deregulation unleashed private energy, but after that corruption emerges and the situation can deteriorate deeper that it was under stale state capitalism regime.

Many analysts assert that China is one of the main examples of state capitalism in the 21st century. But this is only partially true as elements of corporatism in China are very strong. The same was actually true for the USSR. All those three regimes are just different flavor of general corporatist model. As Margaret Thatcher used to say "There is no alternative".

The difference is only in degree of state involvement in economics, not in the substance of the social regime.  Bremmer describes state capitalism the following way (We're All State Capitalists Now - By Niall Ferguson Foreign Policy):

In this system, governments use various kinds of state-owned companies to manage the exploitation of resources that they consider the state's crown jewels and to create and maintain large numbers of jobs. They use select privately owned companies to dominate certain economic sectors. They use so-called sovereign wealth funds to invest their extra cash in ways that maximize the state's profits. In all three cases, the state is using markets to create wealth that can be directed as political officials see fit. And in all three cases, the ultimate motive is not economic (maximizing growth) but political (maximizing the state's power and the leadership's chances of survival). This is a form of capitalism, but one in which the state acts as the dominant economic player and uses markets primarily for political gain.

Just replace the word capitalism with corporatism in the last sentence and you will get pretty apt definition of both China and USSR social models.

Mussolini also aptly characterized corporatism as "state socialism turned on its head": instead of state controlling the corporations, in corporatism corporations are controlling the state.

In the last half of the 19th century people of the working class in Europe were beginning to show interest in the ideas of socialism and syndicalism. Some members of the intelligentsia, particularly the Catholic intelligentsia, decided to formulate an alternative to socialism which would emphasize social justice without the abolition of private property. It was this intellectual tradition that led to Corporatism, as the key is the attempt to merge corporate power with the state power. Such a system does not nessesary need to take form of national socialism. It became dominant in XX century in various, often milder forms (including BTW the "New Deal" in the USA).

Due to its origin Corporatism has been attractive social model in the Latin countries of Europe (Portugal, Spain, Italy and France) and Latin America, where it resonated with Catolisism. Germany also has significant catholic population which, by some accounts, was the core of the NSDP. The connection between Catholicism and the Continental corporatism movements is also obvious in the various Christian Democrat parties (where for ‘Christian’ we should read ‘Roman Catholic’). In USA corporatism initially got fertile ground in states with significant Catholic population such as Wisconsin with its high percentage of German Catholics (senator McCartney represented Wisconsin in the US senate). However, its influence goes much wider.

The key idea of corporatism is to eliminate or at least lessen the inherent conflict between the owners of capital represented by management and labor represented by unions.  And one way to do it and to institualize trade unions as the only legitimate representatives of workers and work with its corrupted leadership, not with charismatic leaders of the strikes or, worse, communists. This way demands of workers were partially accommodated in a form that was acceptable to large capital. And the key here are interest of large capital as it is the primary political force in any corporatist regime. Quoting Benito Mussolini: "Fascism should more appropriately be called Corporatism because it is a merger of State and corporate power.

Later in the USA large corporations understood that outsourcing of labor represents a lever that makes negotiation with trade union unnecessary. Globalization makes possible by-and-large ignore labor demand using outsourcing as a powerful wedge issue. Due to this development, in core of which was the dramatic rise of international communication and Internet, corporatism mutated into a different form in which demands of lower classes were just ideologically suppressed in a way that was done under communist dictatorships using Marxist ideology and labor was split using verge issues and brainwashed to vote against its own political interests. Paradoxically part of organized labor especially in mid-Western states became a staunch supporter of Republican Party (What's the matter with Kansas)

The resulting social order took a very specific form of "free market capitalism" (aka Neoliberalism) which like some previous forms of corporatism such as national socialism has very strong ideological component. Actually so strong that was able to defeat Marxism on international arena and series of neolibral revolutions shook former Soviet camp. Some states like China internally transformed into neoliberal form, avoiding "color revolution" stage.

As an ideology neoliberalism represent eclectic set of pseudoscience theories that somewhat mirror of Hitler theories of superiority of Arian race in economic terms  (replace the Arian race with corporations and "free market").  Like Marxism it became powerful global in its reach secular religion, with its own set of prophets, martyrs, holy books, and the plan of salvation.

In reality free market plays the role of Heaven in Christianity, an idealized but unachievable construction. There was never was and will never be any real "free market" in any neoliberal states  for a simple reason as it is impossible and contracts the fact that neoliberalism as a form of corporatism is a merge of power of large corporations and the state. As such large corporation, and under neoliberalism especially large financial players are always subsidized (and rescued) by state because they control the state. It is the same merger of state power and corporations as in classic corporatism  but with more prominent role of financial oligarchy in the mix: Johnson (The Quiet Coup - Magazine - The Atlantic) called acquiring by financial oligarchy dominant influence on the state a "Quiet coup" (not very dissimilar to NSDP takeover of power in Germany).

But religious component of neoliberalism are so strong that all concerns about this issue are suppressed in "true believers" (which constitute the majority of population in major Western countries).

That's why corruption of government is an immanent feature of corporatist regimes and it instantly became a prominent feature of the US capitalism (and a real problem) immediately after election of Reagan, which signifies political victory of neoliberalism in the USA (with Saving and Loan Crisis was the first act of this corruption drama). And it goes without saying that it became pervasive under Clinton-Bush-Obama regimes. Paradoxically it was especially acute under Clinton administration during which all "socialist" elements of "New Deal" (government regulation of private sector) were completely dismantled.


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[Jan 28, 2021] 'Where is the line between global business attempts to control society-' Putin asks Davos as he calls out power of Big Tech

Jan 28, 2021 | www.rt.com

'Where is the line between global business & attempts to control society?' Putin asks Davos as he calls out power of Big Tech 27 Jan, 2021 12:10 / Updated 3 hours ago Get short URL 'Where is the line between global business & attempts to control society?' Putin asks Davos as he calls out power of Big Tech © Pixabay / Gerd Altmann 354 18 Follow RT on RT Technology giants have become powerful rivals to governments, but there are doubts over the benefits for society of their monopoly positions, Russia's President Vladimir Putin told the annual World Economic Forum, on Wednesday .

"Where is the line between a successful global business, in-demand services and consolidation of big data – and attempts to harshly and unilaterally govern society, replace legitimate democratic institutions, restrict one's natural right to decide for themselves how to live, what to choose, what stance to express freely?" Putin wondered.

"We've all seen this just now in the US. And everybody understands what I'm talking about," he added.

The Russian leader was apparently referring to the crackdown by Big Tech corporations like Twitter, Facebook, Google, Apple and Amazon, mostly on Donald Trump and his supporters, during the recent presidential election in the US. The companies, which, according to some critics, sided with Democratic candidate Joe Biden, blocked President Trump's social media accounts over accusations of inciting violence, with the same being done to many pages of groups and individuals who'd backed him.

ALSO ON RT.COM YouTube prolongs Trump suspension citing 'ongoing potential for violence' as Big Tech doubles down on deplatforming policies

However, one-sided bias claim voiced by some might be an overestimation – the accounts of Democrats supporters were also subject to restrictions, but on a much smaller scale.

Conservative Twitter-like platform Parler was also forced offline, and now there are calls to block the Telegram app as well.

These events have shown that Big Tech companies "in some areas have de facto become rivals to the government," Putin said.

Billions of users spend large parts of their lives on the platforms and, from the point of view of those companies, their monopolistic position is favorable for organizing economic and technological processes, the Russian president explained. "But there's a question of how such monopolism fits the interest of society," he stressed.

ALSO ON RT.COM Putin tells Davos that divided modern world facing 'real breakdown', with demographic struggles & echoes of 1930s pre-WW2 tensions

Think your friends would be interested? Share this story!


shadow1369 8 hours ago 27 Jan, 2021 07:51 AM

This is a great opportunity for Russia to create some Big Tech operators which actually allow free speech. Russia certainly has the expertise and the means, and cannot be bullied by western regimes.
Proton1963 shadow1369 1 hour ago 27 Jan, 2021 02:54 PM
Sure.. But only after the Russians can build a drivable car or a decent smart phone or a laptop.
Election_Fraud Biden shadow1369 1 hour ago 27 Jan, 2021 02:12 PM
The West is surely giving Russia a lot of opportunities, through its own arrogance and stupidity, does not it ? It keeps going backwards in its effort to diminish Russia. And the same goes for China too.
JOHNCHUCKMAN 7 hours ago 27 Jan, 2021 08:45 AM
Putin is a remarkable statesman, and he sets a very high standard for political discourse. I can't think of any of our Western leaders who speak in these truthful and philosophic terms. What we hear in the West are slogans or whining or complaining.
Tenakakhan JOHNCHUCKMAN 3 hours ago 27 Jan, 2021 01:03 PM
The patriarch of the west has become extremely weak. It seems like our leaders lack any moral authority to speak truth and common sense for fear of being cancelled. What we see now is the virtue signaling dregs sponsored by extreme groups leading our nations down the toilet. If a real war was to break out now we would be cannon fodder.
Hilarous 7 hours ago 27 Jan, 2021 09:04 AM
I think there's a simple explanation. Big tech is afraid to lose section 230 of the communications act, which stipulates that online platforms are not legally responsible for user content. Trump and some Republicans have accused social media sites of muzzling conservative voices. They said undoing Section 230 would let people who claim they have been slighted sue the companies. So Big Tech has a strong interest to remove Trump and run down a few bad examples to convince people and politics that Section 230 must remain.
Count_Cash 8 hours ago 27 Jan, 2021 07:40 AM
In many cases they aren't rivals, but owners of government. Money controls everything in the west and big tech have it. They have taken control of, or are blackmailing governments. The Western Liberal Regime straddles both Big Tech and government!
RTaccount Count_Cash 7 hours ago 27 Jan, 2021 08:57 AM
Correct. Let us never forget that in America we are ruled by oligarchs just like the rest of the world, and that our oligarchs are largely hidden. They are our true government, and so it is meaningless to make this type of distinction.

[Sep 19, 2020] How Silicon Valley Broke the Economy by Adrian Chen

The review of the book
Oct 14, 2019 | www.thenation.com

THE CODE: SILICON VALLEY AND THE REMAKING OF AMERICA By Margaret O'Mara

Buy this book

The Apple Bill passed the House overwhelmingly but then died in the Senate after a bureaucratic snafu for which Jobs forever blamed Republican Senator Bob Dole of Kansas, then chair of the Finance Committee. Yet all was not lost: A similar bill passed in California, and Apple flooded its home state with almost 10,000 computers. Apple's success in California gave it a leg up in the lucrative education market as states around the country began to computerize their classrooms. But education was not radically transformed, unless you count a spike in The Oregon Trail –related deaths from dysentery. If anything, those who have studied the rapid introduction of computers into classrooms in the 1980s and '90s tend to conclude that it exacerbated inequities. Elite students and schools zoomed smoothly into cyberspace, while poorer schools fell further behind, bogged down by a lack of training and resources.

A young, charismatic geek hawks his wares using bold promises of social progress but actually makes things worse and gets extremely rich in the process -- today it is easy to see the story of the Apple Bill as a stand-in for the history of the digital revolution as a whole. The growing concern about the role that technology plays in our lives and society is fueled in no small part by a growing realization that we have been duped. We were told that computerizing everything would lead to greater prosperity, personal empowerment, collective understanding, even the ability to transcend the limits of the physical realm and create a big, beautiful global brain made out of electrons. Instead, our extreme dependence on technology seems to have mainly enriched and empowered a handful of tech companies at the expense of everyone else. The panic over Facebook's impact on democracy sparked by Donald Trump's election in a haze of fake news and Russian bots felt like the national version of the personal anxiety that seizes many of us when we find ourselves snapping away from our phone for what seems like the 1,000th time in an hour and contemplating how our lives are being stolen by a screen. We are stuck in a really bad system.

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This realization has led to a justifiable anger and derision aimed at the architects of this system. Silicon Valley executives and engineers are taken to task every week in the op-ed pages of our largest newspapers. We are told that their irresponsibility and greed have undermined our freedom and degraded our democratic institutions. While it is gratifying to see tech billionaires get a (very small) portion of their comeuppance, we often forget that until very recently, Silicon Valley was hailed by almost everyone as creating the path toward a brilliant future. Perhaps we should pause and contemplate how this situation came to be, lest we make the same mistakes again. The story of how Silicon Valley ended up at the center of the American dream in the late 20th and early 21st centuries, as well as the ambiguous reality behind its own techno-​utopian dreams, is the subject of Margaret O'Mara's sweeping new history, The Code: Silicon Valley and the Remaking of America . In it, she puts Silicon Valley into the context of a larger story about postwar America's economic and social transformations, highlighting its connections with the mainstream rather than the cultural quirks and business practices that set it apart. The Code urges us to consider Silicon Valley's shortcomings as America's shortcomings, even if it fails to interrogate them as deeply as our current crisis -- and the role that technology played in bringing it about -- seems to warrant.

S ilicon Valley entered the public consciousness in the 1970s as something of a charmed place. The first recorded mention of Silicon Valley was in a 1971 article by a writer for a technology newspaper reporting on the region's semiconductor industry, which was booming despite the economic doldrums that had descended on most of the country. As the Rust Belt foundered and Detroit crumbled, Silicon Valley soared to heights barely conveyed by the metrics that O'Mara rattles off in the opening pages of The Code : "Three billion smartphones. Two billion social media users. Two trillion-dollar companies" and "the richest people in the history of humanity." Many people have attempted to divine the secret of Silicon Valley's success. The consensus became that the Valley had pioneered a form of quicksilver entrepreneurialism perfectly suited to the Information Age. It was fast, flexible, meritocratic, and open to new ways of doing things. It allowed brilliant young people to turn crazy ideas into world-changing companies practically overnight. Silicon Valley came to represent the innovative power of capitalism freed from the clutches of uptight men in midcentury business suits, bestowed upon the masses by a new, appealing folk hero: the cherub-faced start-up founder hacking away in his dorm room.

The Code both bolsters and revises this story. On the one hand, O'Mara, a historian at the University of Washington, is clearly enamored with tales of entrepreneurial derring-do. From the "traitorous eight" who broke dramatically from the Shockley Semiconductor Laboratory in 1957 to start Fairchild Semiconductor and create the modern silicon transistor to the well-documented story of Facebook's founding, the major milestones of Silicon Valley history are told in heroic terms that can seem gratingly out of touch, given what we know about how it all turned out. In her portrayal of Silicon Valley's tech titans, O'Mara emphasizes virtuous qualities like determination, ingenuity, and humanistic concern, while hints of darker motives are studiously ignored. We learn that a "visionary and relentless" Jeff Bezos continued to drive a beat-up Honda Accord even as he became a billionaire, but his reported remark to an Amazon sales team that they ought to treat small publishers the way a lion treats a sickly gazelle is apparently not deemed worthy of the historical record. But at the same time, O'Mara helps us understand why Silicon Valley's economic dominance can't be chalked up solely to the grit and smarts of entrepreneurs battling it out in the free market. At every stage of its development, she shows how the booming tech industry was aided and abetted by a wide swath of American society both inside and outside the Valley. Marketing gurus shaped the tech companies' images, educators evangelized for technology in schools, best-selling futurists preached personalized tech as a means toward personal liberation. What emerges in The Code is less the story of a tribe of misfits working against the grain than the simultaneous alignment of the country's political, cultural, and technical elites around the view that Silicon Valley held the key to the future.

Above all, O'Mara highlights the profound role that the US government played in Silicon Valley's rise. At the end of World War II, the region was still the sleepy, sun-drenched Santa Clara Valley, home to farms and orchards, an upstart Stanford University, and a scattering of small electronics and aerospace firms. Then came the space and arms races, given new urgency in 1957 with the launch of Sputnik, which suggested a serious Soviet advantage. Millions of dollars in government funding flooded technology companies and universities around the country. An outsize portion went to Northern California's burgeoning tech industry, thanks in large part to Stanford's far-sighted provost Frederick Terman, who reshaped the university into a hub for engineering and the applied sciences.

Stanford and the surrounding area became a hive of government R&D during these years, as IBM and Lockheed Martin opened local outposts and the first native start-ups hit the ground. While these early companies relied on what O'Mara calls the Valley's "ecosystem" of fresh-faced engineers seeking freedom and sunshine in California, venture capitalists sniffing out a profitable new industry, and lawyers, construction companies, and real estate agents jumping to serve their somewhat quirky ways, she makes it clear that the lifeblood pumping through it all was government money. Fairchild Semiconductor's biggest clients for its new silicon chips were NASA, which put them in the Apollo rockets, and the Defense Department, which stuck them in Minuteman nuclear missiles. The brains of all of today's devices have their origin in the United States' drive to defeat the Soviet Union in the Cold War.

But the role of public funding in the creation of Silicon Valley is not the big government success story a good liberal might be tempted to consider it. As O'Mara points out, during the Cold War American leaders deliberately pushed public funds to private industry rather than government programs because they thought the market was the best way to spur technological progress while avoiding the specter of centralized planning, which had come to smack of communist tyranny. In the years that followed, this belief in the market as the means to achieve the goals of liberal democracy spread to nearly every aspect of life and society, from public education and health care to social justice, solidifying into the creed we now call neoliberalism. As the role of the state was eclipsed by the market, Silicon Valley -- full of brilliant entrepreneurs devising technologies that promised to revolutionize everything they touched -- was well positioned to step into the void.

The earliest start-up founders hardly seemed eager to assume the mantle of social visionary that their successors, today's flashy celebrity technologists, happily take up. They were buttoned-down engineers who reflected the cool practicality of their major government and corporate clients. As the 1960s wore on, they were increasingly out of touch. Amid the tumult of the civil rights movement and the protests against the Vietnam War, the major concern in Silicon Valley's manicured technology parks was a Johnson-era drop in military spending. The relatively few techies who were political at the time were conservative.

Things started to change in the 1970s. The '60s made a belated arrival in the Valley as a younger generation of geeks steeped in countercultural values began to apply them to the development of computer technology. The weight of Silicon Valley's culture shifted from the conservative suits to long-haired techno-utopians with dreams of radically reorganizing society through technology.

This shift was perhaps best embodied by Lee Felsenstein, a former self-described "child radical" who cut his teeth running communications operations for anti-war and civil rights protests before going on to develop the Tom Swift Terminal, one of the earliest personal computers.

Felsenstein believed that giving everyday people access to computers could liberate them from the crushing hierarchy of modern industrial society by breaking the monopoly on information held by corporations and government bureaucracies. "To change the rules, change the tools," he liked to say.

Whereas Silicon Valley had traditionally developed tools for the Man, these techies wanted to make tools to undermine him. They created a loose-knit network of hobbyist groups, drop-in computer centers, and DIY publications to share knowledge and work toward the ideal of personal liberation through technology. Their dreams seemed increasingly achievable as computers shrank from massive, room-filling mainframes to the smaller-room-filling minicomputers to, finally, in 1975, the first commercially viable personal computer, the Altair.

Yet as O'Mara shows, the techno-utopians did not ultimately constitute such a radical break from the past. While their calls to democratize computing may have echoed Marxist cries to seize the means of production, most were capitalists at heart. To advance the personal computer "revolution," they founded start-ups, trade magazines, and business forums, relying on funding from venture capital funds often with roots in the old money elite. Jobs became the most celebrated entrepreneur of the era by embodying the discordant figures of both the cowboy capitalist and the touchy-feely hippie, an image crafted in large part by the marketing guru Regis McKenna. Silicon Valley soon became an industry that looked a lot like those that had come before. It was nearly as white and male as they were. Its engineers worked soul-crushing hours and blew off steam with boozy pool parties. And its most successful company, Microsoft, clawed its way to the top through ruthless monopolistic tactics.

Perhaps the strongest case against the supposed subversiveness of the personal computer pioneers is how quickly they were embraced by those in power. As profits rose and spectacular IPOs seized headlines throughout the 1980s, Silicon Valley was championed by the rising stars of supply-side economics, who hitched their drive for tax cuts and deregulation to tech's venture-capital-fueled rocket ship. The groundwork was laid in 1978, when the Valley's venture capitalists formed an alliance with the Republicans to kill then-President Jimmy Carter's proposed increase in the capital gains tax. They beta-​tested Reaganomics by advancing the dubious argument that millionaires' making slightly less money on their investments might stifle technological innovation by limiting the supply of capital available to start-ups. And they carried the day.

As president, Ronald Reagan doubled down with tax cuts and wild technophilia. In a truly trippy speech to students at Moscow State University in 1988, he hailed the transcendent possibilities of the new economy epitomized by Silicon Valley, predicting a future in which "human innovation increasingly makes physical resources obsolete." Meanwhile, the market-friendly New Democrats embraced the tech industry so enthusiastically that they became known, to their chagrin, as Atari Democrats. The media turned Silicon Valley entrepreneurs into international celebrities with flattering profiles and cover stories -- living proof that the mix of technological innovation, risk taking, corporate social responsibility, and lack of regulation that defined Silicon Valley in the popular imagination was the template for unending growth and prosperity, even in an era of deindustrialization and globalization.

T he near-universal celebration of Silicon Valley as an avatar of free-market capitalism in the 1980s helped ensure that the market would guide the Internet's development in the 1990s, as it became the cutting-edge technology that promised to change everything. The Internet began as an academic resource, first as ARPANET, funded and overseen by the Department of Defense, and later as the National Science Foundation's NSFNET. And while Al Gore didn't invent the Internet, he did spearhead the push to privatize it: As the Clinton administration's "technology czar," he helped develop its landmark National Information Infrastructure (NII) plan, which emphasized the role of private industry and the importance of telecommunications deregulation in constructing America's "information superhighway." Not surprisingly, Gore would later do a little-known turn as a venture capitalist with the prestigious Valley firm Kleiner Perkins, becoming very wealthy in the process. In response to his NII plan, the advocacy group Computer Professionals for Social Responsibility warned of a possible corporate takeover of the Internet. "An imaginative view of the risks of an NII designed without sufficient attention to public-interest needs can be found in the modern genre of dystopian fiction known as 'cyberpunk,'" they wrote. "Cyberpunk novelists depict a world in which a handful of multinational corporations have seized control, not only of the physical world, but of the virtual world of cyberspace." Who can deny that today's commercial Internet has largely fulfilled this cyberpunk nightmare? Someone should ask Gore what he thinks.

Despite offering evidence to the contrary, O'Mara narrates her tale of Silicon Valley's rise as, ultimately, a success story. At the end of the book, we see it as the envy of other states around the country and other countries around the world, an "exuberantly capitalist, slightly anarchic tech ecosystem that had evolved over several generations." Throughout the book, she highlights the many issues that have sparked increasing public consternation with Big Tech of late, from its lack of diversity to its stupendous concentration of wealth, but these are framed in the end as unfortunate side effects of the headlong rush to create a new and brilliant future. She hardly mentions the revelations by the National Security Agency whistle-blower Edward Snowden of the US government's chilling capacity to siphon users' most intimate information from Silicon Valley's platforms and the voraciousness with which it has done so. Nor does she grapple with Uber, which built its multibillion-dollar leviathan on the backs of meagerly paid drivers. The fact that in order to carry out almost anything online we must subject ourselves to a hypercommodified hellscape of targeted advertising and algorithmic sorting does not appear to be a huge cause for concern. But these and many other aspects of our digital landscape have made me wonder if a technical complex born out of Cold War militarism and mainstreamed in a free-market frenzy might not be fundamentally always at odds with human flourishing. O'Mara suggests at the end of her book that Silicon Valley's flaws might be redeemed by a new, more enlightened, and more diverse generation of techies. But haven't we heard this story before?

If there is a larger lesson to learn from The Code , it is that technology cannot be separated from the social and political contexts in which it is created. The major currents in society shape and guide the creation of a system that appears to spring from the minds of its inventors alone. Militarism and unbridled capitalism remain among the most powerful forces in the United States, and to my mind, there is no reason to believe that a new generation of techies might resist them any more effectively than the previous ones. The question of fixing Silicon Valley is inseparable from the question of fixing the system of postwar American capitalism, of which it is perhaps the purest expression. Some believe that the problems we see are bugs that might be fixed with a patch. Others think the code is so bad at its core that a radical rewrite is the only answer. Although The Code was written for people in the first group, it offers an important lesson for those of us in the second: Silicon Valley is as much a symptom as it is a cause of our current crisis. Resisting its bad influence on society will ultimately prove meaningless if we cannot also formulate a vision of a better world -- one with a more humane relationship to technology -- to counteract it. And, alas, there is no app for that.

Adrian Chen Adrian Chen is a freelance writer. He is working on a book about Internet culture.

[Sep 19, 2020] Technocracy support of BLM and riots

Technocracy is a part of the neoliberal elite and they are interested in continuation of globalization. As such they are fierce opponents of Trump "national neoliberalism" project. Nothing personal, strictly business.
Sep 19, 2020 | www.zerohedge.com

Doc McGee , 34 minutes ago

A list of some companies too stupid to care about truth or justice.

22 COMPANIES THAT SUPPORT #BLACKLIVESMATTER

[Jan 01, 2020] The relationship between Jews and neoliberalism

Jan 01, 2020 | www.unz.com

Anonymous [211] Disclaimer , says: December 19, 2019 at 8:38 pm GMT

This is a timely article for me as I have been pondering the relationship between Jews and neoliberalism for some time now.

At university I studied under a brilliant Neo-Marxist professor who showed me some theory and arguments that went a long way towards explaining how to make sense of the global power structure.

(Just a quick not for those who recoil at the mere mention of Neo-Marxist: the academics that use a Marxist lens as a tool to criticize the powerful are not all the cuckold communist SJW types – some of these individuals are extremely intelligent and they make very powerful arguments backed by loads of data.)

One of the theories I was introduced to was the notion of the Transnational Capitalist Class in this article called Towards A Global Ruling Class? Globalization and the Transnational Capitalist Class:

http://media.library.ku.edu.tr/reserve/respring18/Intl313_ZOnis/3_Historical_Structuralism.pdf

The authors write the following:

Sklair's work goes the furthest in conceiving of the capitalist class as no longer tied to territoriality Inherent in the international concept is a system of nation-states that mediates relations between classes and groups, including the notion of national capitals and national bourgeoisi. Transnational, by contrast, denotes economic and related social, political, and cultural processes – including class formation that supersede nation-states

What distinguishes the TCC from national or local capitalists is that it is involved in globalized production and manages globalized circuits of accumulation that give it an objective class existence and identity spatially and politically in the global system above any local territories and polities.

Since reading your (Dr Joyce) work on the JQ I began to see the connection between age old complaints of Jews, and what Ford referred to as "The International Jew". In fact, replace the term "transnational capitalist class" from my passages quoted above (and many others) and what you have is perfect mirror image of the argument.

This question has come up often lately, synchronistically (or maybe not). I'm somewhat new to the JQ, having consumed many hours of work (including much of your own) after being sent down the rabbit hole by the ongoing Epstein case. I was pondering that perhaps, Jews take the blame for what the predatory capitalists are doing. Not even a week later you addressed this precise question in your piece about Slavoj Ziszek and now with "vulture capitalism" it is coming up yet again in Carlson's segment followed by the article right here. It also came up on the "other side" in the blog I follow of a professor of globalization in this article: https://zeroanthropology.net/2019/11/27/global-giants-american-empire-and-transnational-capital/

The link above is a review of the book Giants: The Global Power Elite . The review provides a summary of the book which once again could be a text about Jews if one were to replace the term "transnational capitalist class" with "Jews". Why I mention it, though, is the following:

"Chapter 2, "The Global Financial Giants: The Central Core of Global Capitalism," identifies the 17 global financial giants -- money management firms that control more than one trillion dollars in capital. As these firms invest in each other, and many smaller firms, the interlocked capital that they manage surpasses $41 trillion (which amounts to about 16% of the world's total wealth). The 17 global financial giants are led by 199 directors. This chapter details how these financial giants have pushed for global privatization of virtually everything, in order to stimulate growth to absorb excess capital. The financial giants are supported by a wide array of institutions: "governments, intelligence services, policymakers, universities, police forces, militaries, and corporate media all work in support of their vital interests" (p. 60).

Chapter 3, "Managers: The Global Power Elite of the Financial Giants," largely consists of the detailed profiles of the 199 financial managers just mentioned.

This caught my eye because I immediately wondered how many of those 199 directors are Jewish. It also pertains directly to this exact article because I am confident that the vulture capitalists you targeted here are profiled in the book, probably with many others.

Now, I am not in the business of writing about the JQ, so I wanted to suggest to anyone out there that is that if they were to obtain a copy of this book and determine how many of the 199 directors are jews. What this could accomplish is a marriage of the major two theories of the "anti-semites" (for lack of a better word) and the "Neo-Marxists". I would argue that perhaps both sides would learn they are coming at the same thing from two different angles. Most would ignore it, but maybe a few leftist thinkers would receive a much needed electric shock if they were to see the JQ framed in marxist terms. Perhaps some alliances could be forged across the cultural divide in this struggle. Personally I believe that both angles are perfectly valid, and that understanding one without the other will leaves far too much to be desired when studying the powerful.

[Dec 24, 2019] Christmas in Flyover Land - Kunstler

Notable quotes:
"... It's a Wonderful Life ..."
"... we have sent the factories to distant lands and eliminated your jobs, and all the meaning and purpose in your lives -- and cheap stuff from Asia is your consolation prize. Enjoy ..."
"... Homelessness in America runs way deeper than just the winos and drug addicts living on the big city sidewalks. ..."
Dec 24, 2019 | kunstler.com

All the people of America, including the flyovers, are responsible for the sad situation we're in: this failure to reestablish a common culture of values most people can subscribe to and use it to rebuild our towns into places worth caring about. Main Street, as it has come to be, is the physical manifestation of that failure. The businesses that used to occupy the storefronts are gone, except for second-hand stores. Nobody in 1952 would have believed this could happen. And yet, there it is: the desolation is stark and heartbreaking.

Even George Bailey's "nightmare" scene in It's a Wonderful Life depicts the supposedly evil Pottersville as a very lively place, only programmed for old-fashioned wickedness: gin mills and streetwalkers. Watch the movie and see for yourself.

Pottersville is way more appealing than 99 percent of America's small towns today, dead as they are.

The dynamics that led to this are not hard to understand. The concentration of retail commerce in a very few gigantic corporations was a swindle that the public fell for.

Enthralled like little children by the dazzle and gigantism of the big boxes, and the free parking, we allowed ourselves to be played.

The excuse was "bargain shopping," which actually meant we have sent the factories to distant lands and eliminated your jobs, and all the meaning and purpose in your lives -- and cheap stuff from Asia is your consolation prize. Enjoy

The "bones" of the village are still standing but the programming for the organism of a community is all gone: gainful employment, social roles in the life of the place, confidence in the future. For a century starting in 1850, there were at least five factories in town. They made textiles and later on, paper products and, in the end, toilet paper, ironically enough. Yes, really.

They also made a lot of the sod-busting steel ploughs that opened up the Midwest, and cotton shirts, and other stuff. The people worked hard for their money, but it was pretty good money by world standards for most of those years.

It allowed them to eat well, sleep in a warm house, and raise children, which is a good start for any society. The village was rich with economic and social niches, and yes, it was hierarchical, but people tended to find the niche appropriate to their abilities and aspirations -- and, believe it or not, it is better to have a place in society than to have no place at all, which is the sad situation for so many today.

Homelessness in America runs way deeper than just the winos and drug addicts living on the big city sidewalks.


BackRowHeckler December 22, 2019 at 10:50 pm #

It seems there's a major political party exactly working against a common American culture. They jeer at the thought of it. It seems to be the main platform, above all else.

Brh

Log in to Reply
Walter B December 23, 2019 at 3:23 pm #

It is a major party alright BRH, but it is no so much political as it is economic and socially stratified. They are opulent, self consumed and greedy as hell (literally). There can only be so many parasites sucking the lifeblood out of any herd of servant beasts, and they can only suck so long on their hosts before the poor beasts fall over and die. And that is the tipping point, where we lose enough life blood that we can no longer stand upright, but drop to the deck and are consumed. It is the classic Goose that laid the Golden Egg fairy tale being acted out in real life and coming to a neighborhood near you soon. Log in to Reply

sunburstsoldier December 22, 2019 at 11:22 pm #

Beautiful, thoughtful post Jim, yet to be honest it fills me with a sense of anxiety, and this is simply because the catastrophic events you forecast, although for the better in the long run (as they will compel a return to a world made by hand, or the recovery of human scale) will nonetheless bring much suffering to a lot of people ( including my own family). I would personally like to believe there is another way a more sustainable civilization could be attained than on the heels of societal collapse. I do believe the world is full of mystery, and that life itself is a series of unfolding miracles we lack the capacity to comprehend due to our limited perspective. Yet perhaps you are right and some type of collapse is inevitable before a new beginning can be made. If such be the case, as individuals we will be compelled to tap into inner potentials that will needed to meet the approaching apocalypse, potentials which currently lie dormant and undeveloped. Maybe in the process of doing so we will recover our wholeness as well.

[Dec 14, 2019] William Barr on big tech: Companies becoming successful, dominant is not wrong

Dec 14, 2019 | www.youtube.com

Matt S. , 5 hours ago

Break up Silicon Valley, they are trying to take over the world, they think they are above the gov't and the Constitution!

Joe OConnor , 7 hours ago

Big Corp and unions influence gov to much as well as foreign lobbyists Listen to the American people

[Dec 07, 2019] The death of free markets under neoliberalism. Monopolization unhinged

Dec 07, 2019 | economistsview.typepad.com

Fred C. Dobbs , December 04, 2019 at 06:12 AM

The death of free markets
https://www.bostonglobe.com/2019/11/29/opinion/death-free-markets/?event=event25 via @BostonGlobe

Shaul Amsterdamski - November 29, 2019

In 2012, when economist Thomas Philippon was looking into some data, something odd caught his attention.

His homeland, France, was undergoing another revolution, although a much different one: a revolution in the country's telecommunication market. A new mobile operator, Free, had entered the market and disrupted it almost overnight. The new operator slashed prices, offering plans that hadn't been seen before in France.

France's three legacy mobile operators were forced to react and drop their own prices. It didn't help. In only three months, Free's market share reached 4 percent. At the end of the following year, its market share tripled. Today, Free controls 15 to 16 percent of the market, making it France's third largest mobile operator. (If you add the six virtual operators to the mix -- meaning companies who lease broadband space -- you'll get a total of 10 different mobile operators in a country with a population one-fifth the size of the United States.)

"Digging deeper into that crystallized everything for me," says Philippon. "It was an oligopoly based on three legacy carriers that lobbied very hard to prevent anybody from getting a fourth (mobile) license. For 10 years they were successful. But then, in 2011, the regulator changed and gave a license [to] Free. It wasn't a technological change or a change in consumers' taste. It was purely a regulatory decision."

For French consumers, this one decision changed everything. Instead of paying $55 for a 1-gigabyte plan, the new prices for much better plans cost half that. And prices continued to drop. Today, a Free 60-gigabyte plan costs only $12.

But Philippon wasn't just interested in what the new competition in the French telecom industry said about French markets. Having lived in the United States since 1999, he compared the French telecom revolution to the American market. The numbers blew his mind. While in France the number of mobile operators was rising, in the US the number was getting smaller (and that number might even decline further, if the planned Sprint-T-Mobile merger goes through).

The result was a huge price gap between the two countries.

"France went from being much more expensive to much cheaper in two years," he says. "The change in price was drastic -- a relative price move of 50 percent. In such a big market with gigantic firms, that's a big change. And it was not driven by technology, it was driven by pro-competition regulation." He immediately adds, just to emphasize the irony: "It happened in France of all places, a country that historically had a political system that made sure there wasn't too much competition. This is not the place where we expected this kind of outcome."

The opposite was very surprising too: The level of competition in the United States, the role model of free-market democracy, was declining.

Philippon, an acclaimed professor of finance at the New York University Stern School of Business, kept pulling that thread. He gathered an overwhelming amount of data on various markets, took a few steps back to look at the big picture, and then identified a pattern. The result is "The Great Reversal," his recent book, in which he explores and explains when, why, and how, as his subtitle puts it, "America Gave Up on Free Markets."

The telecom story is just one of many examples Philippon provides throughout the book of non-competitive US markets, in which most or all of the power is concentrated in the hands of a few big companies. It's a situation that makes it almost impossible for new competitors to enter and lower prices for consumers. The airline market is another example, as is the pharmaceutical industry, the banking system, and the big tech companies such as Google and Facebook, who have no real competition in the markets they operate in.

The book's main argument has a refreshing mix of both right- and left-leaning economic thinking. It goes like this: During the last 20 years, while the European Union has become much more competitive, the United States has become a paradise for monopolies and oligopolies -- with a few players holding most of the market share. As US companies grew bigger, they became politically powerful. They then used their influence over politicians and regulators, and their vast resources, to skew regulation in their favor.

The fight over net neutrality, to name one example, demonstrates it well.

"Guess who lobbied for that? It's a simple guess -- the people who benefited from it, the ISP's [internet service providers]. And they are already charging outrageous prices, twice as high [as] any other developed country," Philippon says.

This growing concentration of power in the hands of a few has affected everything and everyone. It has inflated prices because consumers have fewer options. Wages are stagnant because less competition means firms don't have to fight over workers. Financial investment in new machinery and technology has plummeted because when companies have fewer competitors they lose the incentive to invest and improve. It has driven CEO compensation up, and workers' compensation down. It has caused a spike in inequality, which in turn has ignited social unrest.

If all of this is too much to wrap your head around, Philippon puts a price tag on it: $5,000 per year. That's the price the median American household pays every year for the lost competition. That's the cost of the United States becoming a Monopoly Land.

How did this happen? According to Philippon, it's a story with two threads. The European side of this story happened almost by mistake. The American side, on the contrary, was no coincidence.

When the European Union was formed in the early 1990s, there was a lot of suspicion between the member states, namely France and Germany. (Two World Wars tend to have that effect.) This mistrust birthed pan-European regulators who enjoyed an unprecedented amount of freedom, more powerful than any of the member countries' governments.

"We did that mostly because we didn't really trust each other very much," he says. Now, 20 years later, "it turns out that this system we created is just a lot more resilient towards lobbying and bad influences than we thought."

At the same time in the United States, the exact opposite was happening. Adopting a free-market approach, regulators and legislators chose not to intervene. They didn't block mergers and acquisitions, and let big companies get bigger.

This created a positive feedback loop: As companies grew stronger, the regulators got weaker, and more dependent on the companies they are supposed to regulate. Tens of millions of dollars were channeled into lobbying. The Supreme Court's Citizens United decision gave corporate money even more political influence.

At some point, big companies started using regulation itself to prevent new competitors from entering the market.

The result wasn't free markets, but "the opposite -- market capture," says Philippon, referring to a situation in which the regulator is so weak it depends completely on the companies it regulates to design regulation.

Philippon is not the only one who's making these claims. A group of economists from the University of Chicago Booth School of Business holds a similar view. They are called Neo-Brandeisian, after the late Justice Louis Brandeis, who, a century ago, fought to broaden antitrust laws. They believe the big tech companies, for example, managed to rig the system, and fly under current antitrust regulation. They think it is time to break them apart.

But not everyone agrees with Philippon's narrative or his conclusions. Economists like Edward Conard, author of "The Upside of Inequality," thinks Philippon's claim that big companies are evidence of less competition is upside down. According to his criticism, it's exactly the opposite: These companies became big and powerful because they innovate and give a lot of value to consumers. He also argues that the conclusion that Europe is more competitive and innovative than the United States is preposterous, given that the biggest tech companies are American, not European.

Philippon addresses this counterclaim in his book. The United States is one giant market of English speakers. Theoretically, if you have a good idea for a new product and you can finance it, you have more than 300 million potential users on day one. In the EU, on the other hand, there are 28 countries, with residents who speak 24 different languages. It's not as simple.

Philippon, who by the age of 40 was named one of the top 25 promising economists by the International Monetary Fund, also differentiates himself from the Chicago school of thought in one important way: He's not dogmatic, he's pragmatic. Instead of a one-size-fits-all solution to the problem, he suggests a more nuanced approach. This is exactly what makes his case both unique and somewhat tricky to grasp. His approach is neither right nor left.

"The idea that free markets and government intervention are opposites, that's bogus. So half of me agrees with the Chicago School and half disagrees," he says.

"But if you think that you can get to a free market without any scrutiny by the government, that's crazy. That's simply untrue empirically. We need to make entry easier to increase competition, that's the objective," he says. "And the way to do so sometimes means more government intervention."

OK, but how do you do that? According to Philippon, each case is different.

"In some cases it will be by more intervention. Like maybe force Facebook to break from WhatsApp. And sometimes it will be by less intervention. Kill a bunch of regulations and requirements for small companies," he says.

The first idea, at least, has caught a lot of public attention during the last year, and has been a talking point of the presidential campaigns of Senators Bernie Sanders and Elizabeth Warren. Facebook's CEO Mark Zuckerberg was recorded saying that if Warren wins, it will "suck for us." Warren's plan for the big tech companies, for example, includes "reversing mergers," which means uncoupling WhatsApp and Instagram from Facebook. Her plan would also forbid Amazon being both a marketplace and a vendor at the same time.

But can any of these interventions actually happen? And if so, what would they mean for American consumers? Those are more complicated questions.

If big tech companies were broken up, Philippon estimates that the average American consumer won't be affected financially.

"Since people don't pay these companies directly, it won't change the bottom line for the middle class, it won't have a big impact on people's disposable income," he says.

What would have a tremendous impact on Americans' lives and income is to keep on going beyond the big tech companies. "We should go after the big ticket items -- telecom, transport, energy, and healthcare. That's where you want action, but there is much less bipartisan support for that," he says.

Something similar to the French telecom revolution is still far from happening in the United States, but the fact that the 2020 campaign is already pushing competition-promoting ideas back into the public discourse is a reason for cautious optimism, according to Philippon. Nevertheless, he warns, we should not let this mild optimism mislead us.

"Free markets are like a public good: It is in nobody's interest to protect them. Consumers are too dispersed and businesses love monopolies," he says. "So to take free markets for granted, that's just stupid."

(Shaul Amsterdamski is senior economics editor
for Kan, Israel's public broadcasting corporation.)

(Hmmm. Our largest monthly bill is for 'telecom',
from Comcast, for TV, phone & internet service.
There's no competitive offering in our town.)

RC (Ron) Weakley said in reply to Fred C. Dobbs... , December 04, 2019 at 10:16 AM
"...Our largest monthly bill is for 'telecom',
from Comcast, for TV, phone & internet service..."

[I got the same information from the service tech doing the annual clean and test on my propane fireplace insert yesterday, in reference to his parents though. They were on Verizon Fios for cable. He thought they should dump cable for a web-TV solution and just use cell phones. Their bill was over $400/month. Mine is a little over $200/month for the same service, which in both cases includes land line. In my zip code Verizon does not bundle Fios with mobile. The only difference that I know is that we have neither any premium channels nor DVR boxes and I assume that his parents must have both to run up a bill that high. When we pony up for Fios Gb, then at least for three years our bill will fall below $100/month, then return to a higher monthly yet if we do not take another new contract after that upgrade contract ends. Verizon only makes new contracts when new services are added or upgraded. Customers get next to no benefit for loyalty/retention. We have both Verizon and Comcast available in our area. I have had both in my present home at different times, but hate Comcast for failures on their part to provide tall vehicle clearance to pass down my driveway until forced to do so by the power company whose poles they must use and for a duplicate billing error where they billed me for two separate addresses and put me into collections for the one that I never resided at since I never saw that bill or knew of it prior to the first collections call.]

Fred C. Dobbs said in reply to RC (Ron) Weakley... , December 06, 2019 at 11:32 AM
(Bernie to the rescue!)

Bernie Sanders unveils plan to boost broadband
access, break up internet and cable titans
https://cnb.cx/34TzaQw
CNBC - Jacob Pramuk - Dec 6

Bernie Sanders unveiled a plan Friday to expand broadband internet access as part of a push to boost the economy and reduce corporate power over Americans.

In his sprawling "High-Speed Internet for All" proposal, the Vermont senator and Democratic presidential candidate calls to treat internet like a public utility. His campaign argues that the internet should not be a "price gouging profit machine" for companies such as Comcast, AT&T and Verizon.

Sanders' plan would create $150 billion in grants and aid for local and state governments to build publicly owned broadband networks as part of the Green New Deal infrastructure initiative. The total would mark a massive increase over current funding for broadband development initiatives. The proposal would also break up what the campaign calls "internet service provider and cable monopolies," stop service providers from offering content and end what it calls "anticompetitive mergers."

Sanders and his rivals for the 2020 Democratic presidential nomination have pushed to boost high-speed internet access for rural and low-income Americans, saying it has become a necessity to succeed in school and business. The self-proclaimed democratic socialist has unveiled numerous plans to root out corporate influence as he runs near the top of a jammed primary field. ...

im1dc -> Fred C. Dobbs... , December 04, 2019 at 05:07 PM
Aa excellent article that brings no new ideas to the debate but updates the debate to today.

One thing economist Thomas Philippon did not mention is that voters must turn out the elected and get new ones who will vote to create more and vigorous competition instead of oligopoly.

That is in my Equality, frequently shared here:

Economics = Politics
and
Politics = Economics

[Aug 19, 2019] Is Big Necessarily Bad The American Conservative

Aug 19, 2019 | www.theamericanconservative.com

Is Big Necessarily Bad? Antitrust cannot be used as a cudgel based on size. There are other ways of whacking at corporate excess. By Marshall Auerback August 19, 2019

Teddy Roosevelt with trust-busting stick, circa 1904. (Image: Library of Congress/Wikimedia Commons) When it comes to relations between consenting adults, size may not matter (or so one hears). But it's a different story in regard to companies and the politically fraught area of antitrust law.

Today, a number of policymakers , economists , and legal scholars connect a host of problems -- excessive wealth inequality, wage stagnation, political dysfunction, market distortions -- directly to the corporate "curse of bigness ," which they argue is a product of lax antitrust enforcement. But they may be misdiagnosing the cause of these diseases and, in so doing, offering up the wrong cure.

Instead of moving toward a new antitrust paradigm, we might do better to consider a more robust utility system of regulation that is "function-centric," rather than size-centric. In other words, regulation that restricts the range of corporate activities (e.g., structural separation so as to prevent companies like Amazon and Google from owning both the platform as well as participating as a seller on that platform), or the prices such companies can charge (as regulators often do for utilities or railways). These considerations would be "size neutral": they would apply independently of corporate size per se. Regulation, rather than antitrust, also better addresses other issues like privacy protection (via a national model that could replicate California's Consumer Privacy Act of 2018 ), labor abuses (it shouldn't matter whether workers are employed by Apple or mom-and-pop sweatshops), and controlling "fake news" dissemination (by placing social media companies under the purview of the Federal Communications Commission).

"Break 'em up" has great historical resonance in the United States. Yet one of the nation's earliest trust-busters, President Theodore Roosevelt, argued that "the remedy for [corporate] abuse was not mindlessly breaking up big firms, but preventing specific abuses by means of a strong national regulation of interstate corporations." Likewise, in the early days of the New Deal, his cousin, Franklin Delano Roosevelt, initially embraced the antitrust philosophy of Supreme Court Justice Louis Brandeis (who, like many of today's modern trust-busters, prioritized power and business structure over consumer welfare). Ultimately though, frustrated that the incessant focus on corporate concentration was hindering World War II efforts to mobilize greater industrial production, FDR concluded that optimal outcomes were more likely to be achieved via "prudent government oversight and using antitrust laws to police abuses -- not to break up every big company simply because it's big."

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After World War II, historian Richard Hofstadter noted a gradual public acceptance of big business . In large part, this was due "to the emergence of countervailing bigness in government and labor" that ultimately led to the "big three tripartite" model among government, business, and unions exemplified in the Treaty of Detroit agreement between General Motors and the United Auto Workers (UAW).

From the 1950s through the 1970s, "Tripartism" was exceptionally successful at promoting economic growth and high wages (the wage growth was explicitly linked to rising productivity in the Treaty of Detroit). Big unions flourished alongside growing conglomerates that emerged as the new face of corporate consolidation (a prime example being International Telephone and Telegraph -- ITT). Equally significant, as the economist Thomas Piketty observed in his sweeping account of rising inequality, Capital in the Twenty-first Century , a new wave of corporate consolidation did not exacerbate prevailing inequalities. To the contrary, this period coincided with a diminution of wealth inequality , as relative wealth gains for the top tier stabilized for the first time in decades.

That all changed in the 1980s with the rise of Ronald Reagan's market fundamentalist agenda. His presidency was characterized by a sustained attack on unions , cuts in public services, and the ascendancy of the doctrine of "shareholder capitalism," used to legitimize the establishment of SEC Rule 10b-18 . That rule engendered an explosion in share buybacks (until it was introduced, companies buying back their own shares was considered a form of stock manipulation). Rather than focusing on job-creating investment, corporate cash flow was thus directed toward stock repurchases to fatten executive compensation.

The legacy of Reagan's market fundamentalism persists today. It is the most cogent explanation we have for growing wealth inequality, wage stagnation, and reduced emphasis on corporate R&D.

This period also coincided with the rise of the "Bork Doctrine," when, citing Robert Bork, the Supreme Court asserted that the main focus of antitrust law should be on economic efficiency and consumer welfare, as opposed to granting the government broad discretion to shape the economy. That shift in priorities is a major source of the neo-Brandeisians' criticism of Bork's antitrust philosophy. It reflects their Jeffersonian vision of a social-economic order organized along the lines of small-scale businesses, with atomistic competition between a large number of equally advantaged units, in theory producing greater innovation and economic dynamism.

But that's a highly idealized vision that doesn't comport with reality. Our modern economy isn't comprised of village blacksmiths, yeoman farmers, and cobblers. A crucial component of the economy today is big business, including many large multinational corporations that operate globally. And it is questionable whether their size automatically equates to market power (in the sense of having the ability to manipulate prices at will and exclude competitors), especially in the context of a global economy featuring a multiplicity of competing national champions. Seldom do we hear calls to break up Detroit's "Big Three," despite global revenues in the hundreds of billions. Why? Because there is a widespread recognition that these companies face significant challenges in a global market dominated by similarly large competitors.

Contrary to popular myth, big companies, not small businesses, can be engines of growth and innovation, as Robert Atkinson and Michael Lind explore in their book Big Is Beautiful: Debunking the Myth of Small Business :

On virtually every meaningful indicator, including wages, productivity, environmental protection, exporting, innovation, employment diversity and tax compliance, large firms as a group significantly outperform small firms.

That insight parallels the scholarship of Joseph Schumpeter, the intellectual godfather of the economics of innovation, who showed that R&D spending and productivity increase with scale. Latterly, Schumpeter's insights have been validated by a recent study from Professors Ann Marie Knott and Carl Vieregger, who conclude (emphasis added):

Not only do large firms (using the U.S. Small Business Association definition of greater than 500 employees) conduct 5.75 more R&D in aggregate than small firms, they have 13% higher productivity with that R&D. However this merely captures the private returns to their R&D. A further benefit of large firm R&D is that it generates the spillovers upon which small firm innovation free-rides .

Size-centric antitrust proposals also ignore the increasing prevalence of economic network theory, which suggests that social networks like Facebook or search engines such as Google lend themselves to becoming natural monopolies in order to function optimally. Here again, function-centric regulation -- i.e., separation between the control of content and distribution -- makes more sense to rectify market abuse. And this could be achieved via utility-style regulation, as no less a figure than right-wing populist Steve Bannon has suggested , rather than creating a bunch of new mini-Facebooks or Googles via court-mandated break-ups (especially if the owners of the newly broken-up companies retain full control of algorithms to determine what people see in their News Feeds, what privacy settings they can use, and even what messages get delivered to news consumers, as Mark Zuckerberg does today ).

It is also the case that many businesses characterized by minimal levels of corporate concentration -- construction, education, entertainment, accommodation, food, business services, transportation, warehousing -- generally experience sub-standard productivity levels, sluggish growth, and low real wages, according to an INET-funded study by Professors Lance Taylor and Özlem Ömer. Working conditions are generally worse, and wages and employment benefits lower, as small business owners are often the first to protest increased regulation or "burdensome" mandates, such as health care provisions. The real point is not to beat up on small businesses, but simply to note that the abuses commonly ascribed to big business are just as, if not more, likely to manifest themselves in smaller industries less prone to corporate concentration.

What about the claim that corporate consolidation contributes to a corrosion of American democracy ? It is true that as companies get bigger, it maximizes their abilities to "pay to play," as Professor Thomas Ferguson asserts in his seminal work, Golden Rule . Ferguson says that powerful blocs of business elites, large and small, with durable (largely economic) interests, are a constant feature of American politics. All have an incentive to get bigger in order to maximize political leverage. That includes smaller businesses that scale up via trade associations to maximize the impact of their "political investment." But again, what is needed here is not an antitrust remedy, but a change in the "pay to play" rules so as to ensure that money and corporate scale have less of a polluting impact on the American polity.

So it may be time to reconsider the simplistic notion that "big is bad." Yes, we want a dynamic economy and a thriving democracy. But mindlessly breaking up big businesses may not be the best path to get us there.

Marshall Auerback is a market analyst and a research associate at the Levy Economics Institute at Bard College.

This article was supported by the Ewing Marion Kauffman Foundation.

[Aug 08, 2019] Global market power and its macroeconomic implications

Aug 08, 2019 | economistsview.typepad.com

anne , August 06, 2019 at 05:45 AM

https://voxeu.org/article/global-market-power-and-its-macroeconomic-implications

June 28, 2018

Global market power and its macroeconomic implications
By Federico Diez, Daniel Leigh and Suchanan Tambunlertchai

The rise in the market power of large firms is assumed to affect economic activity, but measuring either market power or its effects is challenging. Based on firm-level data for 74 countries, this column shows that market power has increased around the world, driven mostly by 'superstar' firms. Higher markups are initially associated with increasing investment and innovation, but the reverse is true when market power becomes too strong. The share of income paid to workers also declines with rising market power.

[Jul 23, 2019] US justice department targets big tech firms in antitrust review by Kari Paul and agencies

Jul 23, 2019 | www.theguardian.com

The US justice department is opening a broad antitrust review into major technology firms, as criticism over the companies' growing reach and power heats up.

The investigation will focus on growing complaints that the companies are unlawfully stifling competition.

"The Department's review will consider the widespread concerns that consumers, businesses and entrepreneurs have expressed about search, social media, and some retail services online," the Department of Justice said in a statement.

ss="rich-link"> A new antitrust frontier – the issue closing partisan divides in the name of policing big tech Read more

"Without the discipline of meaningful market-based competition, digital platforms may act in ways that are not responsive to consumer demands," added the assistant attorney general Makan Delrahim, of the antitrust division.

The review will investigate practices of online platforms including Facebook , Alphabet's Google, Amazon and Apple.

The investigation comes amid calls from lawmakers, including Democratic presidential candidates such as Elizabeth Warren, that the companies should face more scrutiny.

Lat week, Facebook, Google, and Amazon faced a grilling before the House subcommittee on antitrust, commercial and administrative law over their hold on markets including digital advertising, e-commerce and cloud computing.

Lawmakers questioned Amazon over the fees it levies against third-party sellers on the platform and whether this creates a monopoly of power. They also questioned Facebook executives over practices of targeting startups for acquisition and copying features of companies that decline to be acquired.

Lawmakers also grilled Facebook this month over its plans to launch a global cryptocurrency, called Libra. In the hearing, Senator Sherrod Brown of Ohio said Facebook showed "breathtaking arrogance" in attempting to launch a digital financial service after a number of major privacy scandals.

In July, the Federal Trade Commission approved a $5bn fine against Facebook for its handling of user data surrounding the Cambridge Analytica scandal in 2018.

"Facebook is dangerous," Brown said, likening the company to a toddler playing with matches. "It has burned the house down repeatedly and called every attempt a learning experience. Do you really think people should trust you with their bank accounts and their money?"

The Department of Justice investigation is already under way, the Wall Street Journal reported on Tuesday. The department hosted a private presentation from critics of big technology companies, who walked legislators through concerns and arguments for breaking up the firms.

Facebook, Alphabet , Amazon and Apple did not immediately respond to requests for comment.

[Mar 24, 2019] "Russia Gate" investigation was a color revolution agaist Trump. But a strnge side effect was that Clintons have managed to raise a vicious, loud mouthed thug to the status of some kind of martyr.

Highly recommended!
Notable quotes:
"... Back in November of 2016, the American people were so fed up with the neoliberal oligarchy that everyone knows really runs the country that they actually elected Donald Trump president ..."
"... The oligarchy that runs the country responded to the American people's decision by inventing a completely cock-and-bull story about Donald Trump being a Russian agent who the American people were tricked into voting for by nefarious Russian mind-control operatives, getting every organ of the liberal corporate media to disseminate and relentlessly promote this story on a daily basis for nearly three years, and appointing a special prosecutor to conduct an official investigation in order to lend it the appearance of legitimacy. Every component of the ruling establishment (i.e., the government, the media, the intelligence agencies, the liberal intelligentsia, et al.) collaborated in an unprecedented effort to remove an American president from office based on a bunch of made-up horseshit which kind of amounts to an attempted soft coup. ..."
"... It now appears that the world will see that the so-called "Russia Gate" investigation was nothing more than the pro-Clintonista BS that Trump always claimed it was. ..."
"... As for the Clintons, both Bill and Hillary, they should be treated like the creeps they are: corrupt, opportunistic and power hungry. Like Typhoid Mary, they infect everything they touch ..."
"... I'm also convinced that Trump and Clinton colluded, but that they did so in order to get her elected. I don't think he really wanted the job. But still, Hillary can do nationalist, and the designs of the Empire would have proceeded either way. ..."
"... Trump is a crook who takes money wherever he can get it, from subcontractors foolish enough to work for him to bankers dumb enough to believe his financial statements. No doubt he has helped Russian crooks sanitize their booty, but that is apparently too difficult for Mueller to prove. ..."
"... It is not good news that this troglodyte was not indicted, but it is good news that Russia was not found guilty of electing him. Russiagate is an existential issue for the "national security" establishment and just another propaganda offensive designed to justify the largely useless & destructive activities of the Pentagon. ..."
"... It is time to build cooperation not continue the stupidity of US unilateralism and pursuit of global hegemony. Trump and his team have to be removed from office. Democrats don't need Russiagate to do it. The truth will work better. ..."
Mar 24, 2019 | www.moonofalabama.org

Ken , Mar 23, 2019 2:09:31 PM | link

Back in November of 2016, the American people were so fed up with the neoliberal oligarchy that everyone knows really runs the country that they actually elected Donald Trump president. They did this fully aware that Trump was a repulsive, narcissistic ass clown who bragged about "grabbing women by the pussy" and jabbered about building "a big, beautiful wall" and making the Mexican government pay for it. They did this fully aware of the fact that Donald Trump had zero experience in any political office whatsoever, was a loudmouth bigot, and was possibly out of his gourd on amphetamines half the time. The American people did not care. They were so disgusted with being conned by arrogant, two-faced, establishment stooges like the Clintons, the Bushes, and Barack Obama that they chose to put Donald Trump in office, because, fuck it, what did they have to lose?

The oligarchy that runs the country responded to the American people's decision by inventing a completely cock-and-bull story about Donald Trump being a Russian agent who the American people were tricked into voting for by nefarious Russian mind-control operatives, getting every organ of the liberal corporate media to disseminate and relentlessly promote this story on a daily basis for nearly three years, and appointing a special prosecutor to conduct an official investigation in order to lend it the appearance of legitimacy. Every component of the ruling establishment (i.e., the government, the media, the intelligence agencies, the liberal intelligentsia, et al.) collaborated in an unprecedented effort to remove an American president from office based on a bunch of made-up horseshit which kind of amounts to an attempted soft coup.

This is the story Donald Trump is going to tell the American people.
https://consentfactory.org/2019/03/21/mueller-dammerung/

GeorgeV , Mar 23, 2019 2:13:42 PM | link

It now appears that the world will see that the so-called "Russia Gate" investigation was nothing more than the pro-Clintonista BS that Trump always claimed it was. The Clintons once again, both Bill and Hillary, have managed to raise a vicious, loud mouthed thug in the White House to the status of some kind of martyr. What a country America it is. One thing should be clear however. Any politician or media pundit that towed the pro-Clintonista line should be barred from public office or the media forever.

As for the Clintons, both Bill and Hillary, they should be treated like the creeps they are: corrupt, opportunistic and power hungry. Like Typhoid Mary, they infect everything they touch. There is one difference between Typhoid Mary, and Bill and Hillary: Typhoid Mary didn't realize what she was doing, the Clintons did!

the pair , Mar 23, 2019 2:14:43 PM | link
sorry to double post, but it just occurred to me that they pulled a classic DC move: if you have something humiliating or horrible to admit, do it on a friday night.

i have to wonder if the entire western media is cynically praying for a (coincidentally distracting) school shooting or terrorist attack within the next two days.

ger , Mar 23, 2019 2:16:08 PM | link
I have close friends that have been on the MSNBC/Maddow Kool-Ade for years. Constantly declaring Mueller was on the verge of closing in on Trump and associates for treason with the Russians. On Friday night after dinner at our home, the TV was tuned to MSNBC so they could watch their spiritual leader Rachel Maddow....what a pitiful sight (both Maddow and friends). No one was going to jail or be impeached for conspiring with Putin.....how on how could that be true. Putin personally stole the election from Clinton and THEY are just going to let him walk was the declaration a few feet from my chair. Normally, I would recommend grieve counseling, but they are still my friends ... now they can go back to blaming Bernie for Clinton's loss. Maybe I will recommend grieve counseling!
DontBelieveEitherPropaganda , Mar 23, 2019 2:27:18 PM | link
@dltravers: Apart from the "goyim" you may be right.. But if you want to claim with that Trumps opponents where under the pressure of the Zionists, you got it all wrong man.. ;) No presidents been more under the Zionist thumb than DJT.
That ofc doesnt make Hillarys Saudi and Muslim brotherhood connections better.. ;)

Anyway, cheers to the end of this BS! And lets hope that Trump has now payed off his debts with Adelson now that he secured Bibis reelection. But dont hold your breath.. ;)

Nathan Mulcahy , Mar 23, 2019 2:31:06 PM | link
"very politician, every media figure, every Twitter pundit and everyone who swallowed this moronic load of bull spunk has officially discredited themselves for life".

I wish so, but that's not how the exceptional nation of US of A works, as demonstrated by the Iraq WMD fiasco case. In fact, very politician, every media figure, every Twitter pundit (about Saddam's WMD" BS) is alive and well, spreading more BS. What is even more depressing is that the huge chunk of this exceptional nation cannot have enough of the BS and is chanting "give me more, give me more...".

Disgusting! sorry for the pessimistic rant.

renfro , Mar 23, 2019 2:56:18 PM | link
The Dems were stupid to gin up the Russian collusion.

However some good things have come out of the investigation. It cost taxpayers 2 million but recouped over 25 million from those convicted of fraud and tax evasion.
And its not over, Mueller has sent 5 to 7 referrals or evidence/witnesses to SDNY, EDNY, DC, EDVA, plus the National Security and Criminal Divisions. These from information turned up crimes unrelated to his Russia probe and allegedly concerning Trump or his family business, a cadre of his advisers and associates. They are being conducted by officials from Los Angeles to Brooklyn.

The bad news is it exposed how wide spread and corrupt the US has become...in private and political circles.

The other bad news is most of the Trump lovers and Trump haters are too stupid to drop their partisan and personal blinders and recognize that ....ITS THE CORRUPTION STUPID.

BraveNewWorld , Mar 23, 2019 3:00:34 PM | link
b you have repeatedly made the case that this whole thing was kicked off by the Steele dossier. That is factually incorrect. The first investigation was already running before the dossier ever materialized. That investigation spawned the special prosecutors investigation when Trump fired Comey and then went on TV and said it was because of the Russia investigation. The Russia investigation was originally kicked off by Papadopoulos drinking with the the Australian ambassador and bragging about what the campaign was doing with Russia. Remember the original evidence was presented to the leadership of both the House and the Senate when they were both controlled by the Republican party and every one that was briefed came out on camera and said the Justice dept was doing the right thing in pursuing this.

I think the Democrats should lose Hillary down a deep hole and not let her near any of the coming campaign events. But this came about because of the actions of the people around Trump. Not because Hillary controls the US government from some secret bunker some where.

Lozion , Mar 23, 2019 3:09:29 PM | link
One could argue Russiagate was on the contrary quite a success. The Elites behind the scheme never believed it would end up with Trump's impeachment. What they did accomplish though is a deflection via "Fake News" from the Dem's election failures & shenanigans and refocus the attention towards the DNC's emerging pedophilia scandals (Weiner, the Podesta's, Alefantis, etc) & suspicious deaths (Seth Rich, etc) towards a dead-end with the added corollary of preventing US/Ru rapprochement for more then half an administration..
Blooming Barricade , Mar 23, 2019 3:10:02 PM | link
The deeply tragic thing about this for the media, the neocons, and the liberals is that they brought it upon themselves by moving the goalposts continuously. If, after Hillary lost, they had stuck to the "Russia hacked WikiLeaks" lie, then they probably have sufficient proof from their perspective and the perspective of most of the public that Russia helped Trump win. In this case it would be remembered by the Democrats like the stolen election of 2000 (albeit the fact that it was a lie this time). They had multiple opportunities to jump off this train. Even the ridiculous DNI report could have been their final play: "Russia helped Trump." Instead of going with 2000 they went with 2001, aka 9-11, with the same neocon fearmongers playing the pipe organ of lies. As soon as they accepted the Steele Dossier, moving the focus to "collusion" they discredited themselves forever. Many of the lead proponents were discredited Iraq war hawks. Except this time it was actually worse because the whole media bought into it. This leaves an interesting conundrum: there were at least some pro-Afghanistan anti-Iraq warmongers who rejected the Bush premise in the media, so they took over the airwaves for about two years before the real swamp creatures returned. This time, it will be harder to issue a mea culpa. They made this appear like 9-11, well, this time the truthers have won, and they are doomed.
dh-mtl , Mar 23, 2019 3:11:13 PM | link
Societies collapse when their systems (institutions) become compromised. When they are no longer capable of meeting the needs of the population, or of adapting to a changing world.

Societal systems become compromised when their decision making structures, which are designed to ensure that decisions are taken in the best interest of the society as a whole, are captured by people who have no legitimacy to make the decisions, and who make decisions for the benefit of themselves, at the expense of society as a whole.

Russia-gate is a flagrant example of how the law enforcement and intelligence institutions have been captured. Their top officials, no longer loyal to their country or their institution, but rather to an international elite (including the likes of Soros, the Clintons, and far beyond) have used these institutions in an attempt to delegitimize a constitutionally elected president and to over turn an election. This is no less than treason of the highest order.

Indeed, the actions much of the Washington establishment, as well as a number international actors, since Trump was elected seems suspiciously like one of the 'Color Revolutions' that are visited upon any country who's citizens did not 'vote right' the first time. Over-throw the vote, one way or another, until the result that is wanted is achieved. None of these 'Color Revolutions' has resulted in anything good for the country involved. Rather they have resulted in the destruction of each country's institutions, and eventually societal collapse.

In the U.S. the capturing of systems' decision making structures is not limited to Russia-Gate and the overturning of the electoral system. Their are other prime examples:

- The capture of the Air Transport Safety System by Boeing that has resulted in the recent 737 Max crashes, and likely the destruction of the reputation of the U.S. aviation industry, in an industry where reputation is everything.

- The capture of the Financial Regulatory System, by Wall Street, who in 1998 rewrote the rules in their own favor, against the best interests of the population as a whole. The result was the 2008 financial crisis and the inability of the U.S. economy to effectively recover from that crisis.

- This capture is also seen in international diplomatic systems, where the U.S. is systematically by-passing or subverting international law and international institutions, (the U.N. I.C.J., I.N.F. treaty) etc., and in doing so is destroying these institutions and the ability to maintain peace.

The result of system (institution) capture is difficult to see at first. But, in time, the damage adds up, the ability of the systems to meet the needs of the population disappears, and societal decline sets in.

It looks today like the the societal decline is acellerating. Russia-gate is just one of many indicators.

English Outsider , Mar 23, 2019 3:27:38 PM | link
The pair @ 3.

Your comment on the BBC is on the mild side. I listen to it when I drive in in the morning and also get annoyed sometimes. When it is reporting on the Westminster bubble it is factually accurate as far as I can judge. Apart from that, and particularly in the case of the BBC news, we're in information control territory.

But accept that and the BBC turns into quite a valuable resource. It's well staffed, has good contacts, and picks up what the politicians want us to think with great accuracy.

In that respect it's better than the newspapers and better also than the American media. Those news outlets have several masters of which the political elite is only one. The BBC has just the one master, the political elite, and is as sensitive as a stethoscope to the shifting currents within that political elite.

So I wouldn't despise the BBC entirely. It tells us how the politicians want us to think. In telling us that it sometimes gives us a bearing on what the politicians et al are doing and what they intend to do.

worldblee , Mar 23, 2019 3:28:20 PM | link
The never-Trumpers will never let their dreams die. Of course, they never oppose Trump on substantive issues like attempting a coup in Venezuela, withdrawing from the INF treaty, supporting the nazis in Ukraine, supporting Al Qaeda forces in Syria, etc. But somehow they're totally against him and ready to haul out the latest stupid thing he said as their daily fodder for conversation...
ben , Mar 23, 2019 3:32:48 PM | link
renfro @ 10 said;"The Dems were stupid to gin up the Russian collusion."

Uh no, just doing their job of distracting the public, while ignoring the real issues the
American workers care about. You know, the things DJT promised the workers, but has never delivered.(better health care for all, ending the useless wars overseas, an infrastructure
plan to increase good paying jobs), to name just a few.

The corporate Dems( which is the lions share of them), are bought and paid for to distract, and they've done it well.

The Bushes, the Clintons, the Obamas, and most who have come before, are of the same ilk.

Bend over workers and lube up, for more of the same in 2020...

Jackrabbit , Mar 23, 2019 3:48:10 PM | link
I profoundly disagree with the notion that Russiagate had anything to do with Hillary's collusion with the DNC. Gosh, that is naive at best.
1) Hillary didn't need to collude against Sanders - the additional money that she got from doing so was small change compared the to overall amount she raised for her campaign.

2) Sanders was a long-time friend of the Clintons. He boasted that he's known Hillary for over 25 years.

3) Sanders was a sheepdog meant to keep progressives in the Democratic Party. He was never a real candidate. He refused to attack Hillary on character issues and remained loyal even after Hillary-DNC collusion was revealed.

When Sanders had a chance to total disgrace Hillary, he refused to do so. Hillary repeatedly said that she had NEVER changed for vote for money but Warren had proven that she had: Hillary changed her vote on the Bankruptcy Bill for money from the credit card industry.

4) Hillary didn't try to bury her collusion with the DNC (as might be expected), instead she used it to alienate progressive voters by bring Debra Wasserman-Shultz into her campaign.

5) Hillary also alienated or ignored other important constituencies: she wouldn't support an increase in the minimum wage but accepted $750,000 from Goldman Sachs for a speech; she took the black vote for granted and all-but berated a Black Lives Matters activist; and she called whites "deplorables".

Hillary threw the race to her OTHER long-time friend in the race: Trump. The Deep-State wanted a nationalist and that's just what they got.

6) Hillary and the DNC has shown NO REMORSE whatsoever about colluding with Sanders and Sanders has shown no desire whatsoever to hold them accountable.

IMO Russiagate (Russian influence on Trump) and accusations of "Russian meddling" in the election are part of the same McCarthyist psyop to direct hate at Russia and stamp out any dissent. Trump probably knowingly, played into the Deep State's psyop by:

> hiring Manafort;

> calling on Russia to release Hillary's emails;

> talking about Putin in a admiring way.

And it accomplished much more than hating on Russia:

> served as excuse for Trump to do Deep State bidding;

> distracted from the real meddling in the 2016 election;

> served as a device for settling scores:

- Assange isolated
(Wikileaks was termed an "agent of a foreign power");

- Michael Flynn forced to resign
(because he spoke to the Russian ambassador).

hopehely , Mar 23, 2019 3:49:15 PM | link The US owes Russia an official apology. And also Russia should get its stolen buildings and the consulate back. And maybe to get paid some compensation for the injustice and for damages suffered. Without that, the Russiagate is not really over.
Jen , Mar 23, 2019 4:01:43 PM | link
BraveNewWorld @ 11:

If memory serves me correctly, the initial accusations of collusion between DJT's presidential campaign and the Kremlin came from Crowdstrike, the cybersecurity company hired by the Democratic National Committee to oversee the security of its computers and databases. This was done to deflect attention away from Hillary Clinton's illegal use of a personal server at home to conduct government business during her time as US State Secretary (2009 - 2013), business which among other things included plotting with the US embassy in Libya (and the then US ambassador Chris Stevens) to overthrow Muammar Gaddhafi's government in 2011, and conspiring also to overthrow the elected government in Honduras in 2010.

The business of Christopher Steele's dossier (part or even most of which could have been written by Sergei Skripal, depending on who you read) and George Papadopoulos' conversation with the half-wit Australian "diplomat" Alexander Downer in London were brought in to bolster the Russiagate claims and make them look genuine.

As B says, Crowdstrike does indeed have a Ukrainian nationalist agenda: its founder and head Dmitri Alperovich is a Senior Fellow at The Atlantic Council (the folks who fund Bellingcat's crapaganda) and which itself receives donations from Ukrainian oligarch Viktor Pinchuk. Crowdstrike has some association with one of the Chalupa sisters (Alexandra or Andrea - I can't be bothered dredging through DuckDuckGo to check which - but one of them was employed by the DNC) who donated money to the Maidan campaign that overthrew Viktor Yanukovych's government in Kiev in February 2014.

james , Mar 23, 2019 4:16:03 PM | link
thanks b... i would like russiagate to be finished, but i tend to see it much like kadath @2.. the link @2 is worth the read as a reminder of how far the usa has sunk in being a nation of passive neocons... emptywheel can't say no to this as witnessed by her article from today.. ) as a consequence, i agree with @14 dh-mtl's conclusion - "It looks today like the the societal decline is acellerating. Russia-gate is just one of many indicators."

the irony for those of us who don't live in the usa, is we are going to have watch this sad state of affairs continue to unravel, as the usa and the west continue to unravel in tandem.. the msm as corporate mouthpiece is not going to be tell us anything of relevance.. instead it will be continued madcow, or maddow bullshit 24-7... amd as kadath notes @2 - if any of them are to step up as a truth teller - they will be marginalized or silenced... so long as the mainstream swallow what they are fed in the msm, the direction of the titanic is still on track...

@19 hopehely... you can forget about anything like that happening..

WDDiM , Mar 23, 2019 4:36:17 PM | link
What Difference Does it Make?
They don't really need Russia-gate anymore. It bought them time. As we speak nuclear bombers make runs near Russian borders every day and Russian consulates get attacked with heavy weaponry in the EU and no Russian outlet is even making a reference,while Israel is ready to move heavy artillery in to Golan targeting Russia bases in Syria and China raking all their deals for civilian projects in the Med.
Russia got stuffed in the corner getting all the punches.
Zanon , Mar 23, 2019 4:37:43 PM | link
What a horrible witch hunt, but the msm will keep on denying and keep creating new hoaxes about Trump, Russia.
Heck the media even deny there was no collussion, they keep spinning it in different ways!

But remember folks, we here was always right...
The Mueller Report Is In. They Were Wrong. We Were Right.
https://medium.com/@caityjohnstone/the-mueller-report-is-in-they-were-wrong-we-were-right-a915d23a6d82

iv> also, there is a big risk that the media, deep state will create new accusations coming days.

Posted by: Zanon , Mar 23, 2019 4:39:30 PM | link

also, there is a big risk that the media, deep state will create new accusations coming days.

Posted by: Zanon | Mar 23, 2019 4:39:30 PM | link

Russ , Mar 23, 2019 4:41:30 PM | link
People are forgetting to call Dembot agent Wheeler "FBI rat Wheeler", or just Rat Wheeler. Or EmptySqueal.
karlof1 , Mar 23, 2019 4:47:23 PM | link
Thanks for citing Caitlin Johnstone's wonderful epitaph, b--Russiavape indeed!

During the fiasco, the Outlaw US Empire provided excellent proof to the world that it does everything it accused Russia of doing and more, while Russia's cred has greatly risen. Meanwhile, there're numerous other crimes Trump, his associates, Clinton, her associates--like Pelosi--ought to be impeached, removed from office, arrested, then tried in court, which is diametrically opposed to the current--false--narrative.

Scotch Bingeington , Mar 23, 2019 4:47:39 PM | link
The people who steered us into two years of Russiavape insanity are the very last people anyone should ever listen to ever again when determining the future direction of our world.

Yes, absolutely. And not just regarding the world's future, but even if you happen to be in the same building with one of them and he/she bursts into your already smoke-filled room yelling that the house is on fire.

Btw, whatever authority has ever ruled that "ex-MI6 dude" Steele (who doesn't remind me of steel at all, but rather of a certain nondescript entity named Anthony Blair) is in fact merely 'EX'? He himself? The organisation? The Queen perhaps?

Zanon , Mar 23, 2019 4:52:41 PM | link
Scotch Bingeington

Expose them at every opportunity, they should not get away with this like nothing happend:

If you think a single Russiagate conspiracist is going to be held accountable for media malpractice, you clearly haven't been awake the past 2 decades. No one will pay for being wrong. This profession is as corrupt & rotten as the kleptocracy it serves

defeatism isn't the answer -- should remind & mock these hacks every opportunity. Just need to be aware of the beast we're up against.


https://twitter.com/MarkAmesExiled/status/1109235461430657026
Jackrabbit , Mar 23, 2019 5:00:23 PM | link
Who will say that the King has no clothes?

The establishment plays on peoples fears and so we all sink together as we all cling to our "lesser evils", tribal allegiances, and try to avoid the embarrassment of being wrong.

Although everyone is aware of the corruption and insider dealing, no one seems to want to acknowledge the extent, or to think critically so as to reveal any more than we already know.

It's almost as though corruption (the King's nudity) is a national treasure and revealing it would be a national security breach in the exceptional nation.

And so to the Deep State cabal continues to rule unimpeded.

WDDiM , Mar 23, 2019 5:08:16 PM | link
The oligarchy that runs the country responded to the American people's decision by inventing a completely cock-and-bull story about Donald Trump being a Russian agent who the American people were tricked into voting for by nefarious Russian mind-control operatives, getting every organ of the liberal corporate media to disseminate and relentlessly promote this story on a daily basis for nearly three years

Posted by: Ken | Mar 23, 2019 2:09:31 PM | 4

You people don't get it do you?
'The Plan' was to get rid of Turkey-Russia-Israel (and a few others) with one fell swoop....

steve , Mar 23, 2019 5:11:08 PM | link
Deep state makes the warren commish seem authoritative
john , Mar 23, 2019 5:13:37 PM | link
the rot in DC is palpable. this whole russiagate fiasco's been like some kind of really bad audition for deeper state kabuki...what's next?

keeping brand Trump alive.

Blooming Barricade , Mar 23, 2019 5:22:08 PM | link
Matt Taibbi:

It's official: Russiagate is this generation's WMD
The Iraq war faceplant damaged the reputation of the press. Russiagate just destroyed it

https://taibbi.substack.com/p/russiagate-is-wmd-times-a-million

Pft , Mar 23, 2019 5:38:41 PM | link
Russia gate was both a diversion from the real collusions (Russian Mafia , China and Israel) and a clever ruse to allow Trump to back off from his campaign promise to improve relations with Russia. US policy toward Russia is no different under Trump than it was during Obamas administration. Exactly what the Russia Gaters wanted and Trump delivered.

That Mueller could find nothing more than some tax/money laundering/perjury charges in which the culprits in the end get pardoned is hardly surprising given his history. Want something covered up? Put Mueller on it.

To show how afraid Trump was of Mueller he appointed his long term friend Barr as AJ and pretended he didn't know how close they were when it came out. There is no lie people wont believe. Lol

Meanwhile Trumps Russian Mafia connections stay under the radar in MSM, Trump continues as Bibi's sock puppet, the fake trade war with China continues as Ivanka is rolling in China trademarks .

The Rothschild puppet that bailed out Trumps casinos as Commerce Secretary overseeing negotiations that will open the doors for more US and EU (they willy piggy back on the deal like hyenas) jobs to go to China (this time in financial/services) and stronger IPR protections that will facilitate this transfer, and will provide companies more profits in which to buyback stocks but wont bring manufacturing jobs back.

tuyzentfloot , Mar 23, 2019 5:46:31 PM | link
The collusion story has been hit badly and it will likely lose its momentum, but I wonder how far reaching this loss of momentum is. There are many variants. The 'unwitting accomplice' is an oxymoron which isn't finished yet. The Russians hacking the election: not over. The Russians sowing discord and division. Not over. Credibility of the Russiagate champions overall? Not clear. Some could take a serious hit. Brennan and other insiders who made it onto cable tv?
It is possible that the whole groupthink about Russiagate changes drastically
and that 'the other claims' also lose their credibility but it's far from certain. After years of building up tension Russia's policies are also changing. I think they have shown restraint but their paranoia and aggressiveness is also increasing and some claims will become true after all.
JOHN CHUCKMAN , Mar 23, 2019 5:48:55 PM | link

"Russiagate" has always been a meaningless political fraud.

When folks like Hillary Clinton sign on to something and give it a great deal of weight, you really do know you are talking about an empty bag of tricks. She is a psychopathic liar, one with a great deal of blood on her hands.

My problem with this official result is that it may tend to give Trump a boost, new credibility.

The trouble with Trump has never been Russia - something only blind ideologues and people with the minds of children believe - it is that he is genuinely ignorant and genuinely arrogant and loud-mouthed - an extremely dangerous combination.

And in trying to defend himself, this genuine coward has completely surrendered American foreign policy to its most dangerous enemies, the Neocons.


https://chuckmanwordsincomments.wordpress.com/2018/04/20/john-chuckman-comment-americas-democrats-launch-lawsuit-against-trump-and-russia-and-wiki-leaks-over-election-hilarious-this-is-a-country-fit-to-dominate-the-earth-they-cant-manage-their-own/

https://chuckmanwordsincomments.wordpress.com/2017/03/03/john-chuckman-comment-yet-more-ignorant-gossip-and-innuendo-about-trump-and-russia-this-all-reminds-me-of-insane-past-american-campaigns-against-procter-gamble-or-harry-potter-charging-devil/

https://chuckmanwordsincomments.wordpress.com/2018/12/08/john-chuckman-comment-what-americas-neocons-represent-for-arms-control-agreements-such-as-the-inf-with-russia-and-heres-the-deadly-weakness-in-trumps-psychology-that-has-allowed-neocons-to-ta/

https://chuckmanwordsincomments.wordpress.com/2018/09/23/john-chuckman-comment-a-comment-rightly-asks-with-trump-doing-everything-the-establishment-wants-why-do-they-still-want-to-get-rid-of-him-i-think-these-are-the-essential-reasons/

https://chuckmanwordsincomments.wordpress.com/2018/05/06/john-chuckman-comment-some-very-dark-thoughts-of-where-america-is-going-in-its-relations-with-russia-and-iran-i-do-think-we-live-in-dangerous-times-and-they-are-deliberately-manufactured/

https://chuckmanwordsincomments.wordpress.com/2017/04/08/john-chuckman-comment-complete-degradation-of-a-self-styled-great-nation-which-allows-paid-thugs-to-use-poison-gas-to-give-it-an-excuse-for-still-more-killing-the-dark-place-we-are-brought-to-by-tr/

https://chuckmanwordsincomments.wordpress.com/2018/12/06/john-chuckman-comment-more-on-the-strange-phenomenon-of-trump-and-americas-neocons-a-man-who-imagines-himself-a-great-leader-leading-nothing-and-he-still-has-pathetic-followers-who-think-hes-fi/

https://chuckmanwordsincomments.wordpress.com/2017/12/14/john-chuckman-comment-new-phony-book-on-trump-and-russia-whats-really-going-on-with-all-the-mumbo-jumbo-insanity-in-america-the-real-target-aint-trump-neocons-and-russia/


Jackrabbit , Mar 23, 2019 5:59:03 PM | link
Blaming Russiagate on Hillary is very easy for those who hate her or hope that Trump will deliver on his faux populist fake-agenda.

No one wants to contemplate the possibility that Hillary and Trump, and the duopoly they lead, fixed the election and planned Russiagate in advance.

It seems a bridge too far, even for the smart skeptics at MoA.

So funny.

Trump has proven himself to be a neocon. He broke his campaign promise to investigate Hillary within DAYS of being elected. He has brought allies of his supposed enemies into his Administration.

Yet every one turns from the possibility that the election was fixed. LOL.

The horrible possibility that our "democracy" is managed is too horrible to contemplate. Lets just blame it all on Hillary.

Welcome to the rabbithole.

Copeland , Mar 23, 2019 6:23:41 PM | link
Those who have been holding their breath for two years can finally exhale. I guess the fever of hysteria will have to be attended a while longer. A malady of this kind does not easily die out overnight. Those who have been taken in, and duped for so long, can not so easily recover. The weight of so much cognitive dissonance presses down on them like a boulder. The dust of the stampeded herd behind Russiagate is enough paralyze the will of those who have succumbed.

As Joseph Conrad once wrote, "The ways of human progress are inscrutable."

Jonathan , Mar 23, 2019 7:02:54 PM | link
@37 Jackrabbit,

Of course it was fixed. That's what the Electoral College is for .

Arioch , Mar 23, 2019 7:06:26 PM | link
Russiagate is a pendulum, it reached the dead point, it would hange in the air for a moment, then it would start swinging right backwards at full speed crashign everything in the way!

It would be revealed, it was Russia who paid Muller to start that hysteria and stole money from American tax-payers and make America an international laughing stock. "Putin benefited from it", highly likely!

Muller's investigation is paid for with Manafort's seized cash and property and Manafort has made Yanukovich king of Ukraine, so Manafort is Putin's agent, so Muller is working of Putin's money, so it was Putin's collusion everything that Muller is doing! Highly likely.

fast freddy , Mar 23, 2019 7:12:20 PM | link
There is no "Liberal Media". Those whom claim to be Liberal and yet support the Warmonger Democratic Party (Republican lite) are frauds. Liberalism does not condone war and it most certainly does not support wars of aggression - especially those wars waged against defenseless nations. Neither can liberalism support trade sanctions or the subjugation of Palestinians in the Apartheid State of ISreal.
Peter , Mar 23, 2019 7:16:00 PM | link
https://www.youtube.com/watch?v=jHo6cW0HVkQ DISGRACEFUL WILL WE EVER SAY NO?
vk , Mar 23, 2019 7:24:32 PM | link
@ Posted by: Jackrabbit | Mar 23, 2019 3:48:10 PM | 18

We must be very careful with the words we choose, in order to paint the correct conjuncture and not to throw the bathtub with the baby inside.

It's one thing to say Bernie Sanders is not a revolutionary; it's another completely different thing to say he was in cahoots with the Clintons.

If Bernie Sanders really was a "friend" of the Clintons, then he wouldn't even have disputed the primaries against Hillary. Not only he chose to do so, but he only didn't win because the DNC threw all its weight against him.

Now, I agree he's not a revolutionary socialist. He's an imperialist who believes the spoils of the empire should be also used to build a Scandinavian-style Welfare State for the American people only. A cynic would tell you this would make him a Nazi without the race theme, but you have to keep in mind societies move in a dialectical patern, not a linear one: if you preach for "democratic socialism", you're bringing the whole package, not only the bits you want.

I believe the rise of Bernie Sanders had an overall positive impact in the world as it exists. Americans are more aware of their own contradictions (more enlightened) now than before he disputed those faithful primaries of 2016. And the most important ingredient for that, in my opinion, was the fact he was crushed by both parties; that the "establishment" acted in unison not to let him get near the WH. That was a didactic moment for the American people (or a signficant part of it).

But I agree Russiagate went well beyond just covering the Clintons' dirt in the DNC.

It may have be born like that, but, if that was the case, the elites quickly realized it had other, ampler practical uses. The main one, in my opinion, was to drive a wedge between Trump's Clash of Civilizations's doctrine -- which perceives China as the main long term enemy, and Russia as a natural ally of the West -- and the public opinon. The thing is most of the American elite is far too dependent on China's productive chain; Russia is not, and can be balkanized.

Sandwichman , Mar 23, 2019 7:30:58 PM | link
counterpoint: If the Mueller report does not EXPLICITLY exonerate Trump, it does NOT exonerate Trump.
wagelaborer , Mar 23, 2019 7:43:06 PM | link
There is a funny video compilation of the TV talking heads predicting the end of Trump, new bombshells, impeachment, etc., over the last two years.
Unfortunately, the same sort of compilation could be made of sane people predicting "this new information means the end of Russiagate" over the same time period.
The truth is that the truth doesn't matter, only the propaganda, and it has not stopped, only spun onto new hysteria.
Rob , Mar 23, 2019 7:58:15 PM | link
As others have said, hard core Russiagaters will likely not be convinced that they have been wrong all along. They have too much emotional investment in the grand conspiracy theory to simply let it go. Rather, they will forever point to what they believe are genuine bits of evidence and curse Mueller for not following the leads. And the Dems in the House of Representatives will waste more time and resources on pointless investigations in an effort to keep the public sufficiently distracted from more important matters, such as the endless wars and coups that they support. A pox on all their houses, both Democrats and Republicans.
Sandwichman , Mar 23, 2019 8:08:59 PM | link
"...hard core Russiagaters will likely not be convinced that they have been wrong all along."

Wrong about what? There seems to be "narrative" operative here that there are only two positions on this matter: the "right" one and the "wrong" one and nothing else.

Sunny Runny Burger , Mar 23, 2019 8:10:36 PM | link
Ben nails it in "Mar 23, 2019 3:32:48 PM | 17".

Ben's and other comments might make this a little bit superfluous but it's short.

A case of divide and conquer against the population

This time it was a fabricated scandal.

Continued control over "facts" and narratives, the opportunity for efficient misdirection and distraction, stealing and wasting other people's time and effort, spurious disagreements, wearing down relations.

The illusion of choice, (false) opposition, blinded "oversight", and mythical claims concerning a civilian government (in the case of the US: "of, for, and by" or something like that).

Who knew or knows is irrelevant as long as the show goes on. There's nothing to prove anything significant about who if anyone may or may not be behind the curtain and thus on towards the next big or small scandal we go because people will be dissatisfied and hungry and ready to bite as hard as possible on some other bait for or against something.

Maybe "Russiagate" was impeccably engineered or maybe it organically outcompeted other distractions on offer that would ultimately also waste enormous amounts of time and effort.

Management by crisis

The scandals, crises, "Science says" games and rubbish, outrage narratives, and any other manipulations attempt and perhaps succeed at controlling the US and the world through spam.

Jackrabbit , Mar 23, 2019 8:11:22 PM | link
Jonathan @39: Of course it was fixed. That's what the Electoral College is for.

Well, you can say the same think about money-as-speech , gerrymandering, voter suppression, etc. Despite all these, Americans believe that their democracy works.

I contend that what we witnessed in 2016 was a SHOW. Like American wrestling. It was (mostly) fake. The proper term for this is kayfabe .

<> <> <> <> <> <> <> <>

And we have seen other 'shows' also, like:

> White Helmets;

>> Skripal;

>> the Kavanaugh hearings;

>> pulling troops out of Syria.

aspnaz , Mar 23, 2019 8:19:24 PM | link
My advice to the yanks mourning Russiagate: move to the UK. The sick Brits will keep the Russia hating cult alive even after they spend a decade puking over Brexit.
mourning dove , Mar 23, 2019 8:50:48 PM | link
Jackrabbit @18
So, you don't think HRC qualifies as a nationalist? She can't fake populist, but she can do nationalist.
I also think she is much too ambitious to have intentionally thrown the election. It was her turn dammit! Take a look at her behavior as First Lady if you think she's the kind of personality that is content to wield power from behind the scenes.
Cortes , Mar 23, 2019 8:51:27 PM | link
As usual, a fine essay. Thank you.

A couple of suggestions?

The headline would be better worded "Russiagate really is finished."

And the reaction at Colonel Lang's site makes interesting reading.

Les , Mar 23, 2019 8:55:52 PM | link
They didn't fall for the Steele dossier. I recall that emptywheel had discredited the dossier during the election as it was known to have been rejected by major media outlets leading up to the election. I think they merely fell behind the others as the outgoing administration, the Democrats, the CIA, and the media chose to use the dossier to 'blackmail' Trump.
paul , Mar 23, 2019 8:56:02 PM | link
The most important fruit of russiagate, from the view of the establishment of the hegemon, is that America has now taken a giant step towards full bore censorship.
Jackrabbit , Mar 23, 2019 9:00:35 PM | link
vk @43

We must be very careful ... and not to throw the bathtub with the baby inside.
Don't we already have plenty of evidence that there is no precious democratic baby in the bath? What do you think the Yellow Vests are doing every weekend?

If Bernie Sanders really was a "friend" of the Clintons, then he wouldn't even have disputed the primaries against Hillary.
Why not? Do you know him personally? Can you vouch for him?

Have you read this: Presidential Candidate Bernie Sanders: Sheepdogging for Hillary and the Democrats in 2016 ?

Bernie referred to Hillary as "my friend" many times on the campaign trail. He told Politico that he's known her for 25 years but they are not "best friends". That's Sander's typical word judo. Like when he was asked about Zionism, his response: what's that?

The fact is, Bernie is friendly with all the top Democrats: Obama campaigned for him and Schumer wouldn't allow funding for democratic candidates that opposed him.

Then there's other strangeness. Like Bernie's refusal to release his 2014 tax returns. Bernie said his returns were "boring" but when his 2015 tax return was delayed the press asked him to release his 2014 return (Hillary boasted that she had released 10 years of returns). Bernie refused.

Now, I agree he's not a revolutionary socialist.... I believe the rise of Bernie Sanders had an overall positive impact in the world as it exists.
Really? LOL. Sanders REFUSED to lead a Movement for real change. That might've changed things for the better Mi>- like the Yellow Vests are changing things for the better.

What have we seen from the Democratics since 2016? Bullshit like Russiagate, meaningless astroturf activism around bathrooms and statues, and outlandish policies like open borders. These things just irritate most Americans and will lead to more failure for the Democrats and another 4 years for Trump.

Lastly, you said nothing about Bernie's refusal to attack Hillary on character issues and to counter her assertion that she NEVER changed her vote for money. Other examples: Bernie refused to discuss Hillary's home email server, never mentioned Hillary's well known work to squash investigations of Bill Clinton for abusing women (Jennifer Flowers), and didn't talk about other scandals like Benghazi ("What difference does it make") and her glee at the overthrow of Quadaffi ("we came, we saw, we kicked his ass").

And what of Trump? He was the ONLY republican populist in a field of 19. Do you find that even a little bit strange?

Jackrabbit , Mar 23, 2019 9:02:11 PM | link
Sorry, here's a more readable version:

We must be very careful ... and not to throw the bathtub with the baby inside.
Don't we already have plenty of evidence that there is no precious democratic baby in the bath? What do you think the Yellow Vests are doing every weekend?

If Bernie Sanders really was a "friend" of the Clintons, then he wouldn't even have disputed the primaries against Hillary.
Why not? Do you know him personally? Can you vouch for him?

Have you read this: Presidential Candidate Bernie Sanders: Sheepdogging for Hillary and the Democrats in 2016 ?

Bernie referred to Hillary as "my friend" many times on the campaign trail. He told Politico that he's known her for 25 years but they are not "best friends". That's Sander's typical word judo. Like when he was asked about Zionism, his response: what's that?

The fact is, Bernie is friendly with all the top Democrats: Obama campaigned for him and Schumer wouldn't allow funding for democratic candidates that opposed him.

Then there's other strangeness. Like Bernie's refusal to release his 2014 tax returns. Bernie said his returns were "boring" but when his 2015 tax return was delayed the press asked him to release his 2014 return (Hillary boasted that she had released 10 years of returns) . Bernie refused.

Now, I agree he's not a revolutionary socialist.... I believe the rise of Bernie Sanders had an overall positive impact in the world as it exists.
Really? LOL. Sanders REFUSED to lead a Movement for real change. That might've changed things for the better Mi>- like the Yellow Vests are changing things for the better.

What have we seen from the Democratics since 2016? Bullshit like Russiagate, meaningless astroturf activism around bathrooms and statues, and outlandish policies like open borders. These things just irritate most Americans and will lead to more failure for the Democrats and another 4 years for Trump.

Lastly, you said nothing about Bernie's refusal to attack Hillary on character issues and to counter her assertion that she NEVER changed her vote for money. Other examples: Bernie refused to discuss Hillary's home email server, never mentioned Hillary's well known work to squash investigations of Bill Clinton for abusing women (Jennifer Flowers), and didn't talk about other scandals like Benghazi ("What difference does it make") and her glee at the overthrow of Quadaffi ("we came, we saw, we kicked his ass").

And what of Trump? He was the ONLY republican populist in a field of 19. Do you find that even a little bit strange?

mourning dove , Mar 23, 2019 9:06:00 PM | link
Jonathan @39
Exactly! It's the Electoral College that decides elections, not voters.
Jackrabbit , Mar 23, 2019 9:13:59 PM | link
mourning dove @57: Exactly! It's the Electoral College that decides elections, not voters.

Do you think Hillary didn't know that? She refused to campaign in the three mid-western states that would've won her the electoral college. Each of the states were won by Trump by a thin margin.

Hoarsewhisperer , Mar 23, 2019 9:14:04 PM | link
Gosh and Blimey!
Comment #56 in a thread about an utterly corrupt political system and no-one has mentioned the pro-"Israel" Lobby?
Words fail me. So I'll use someone else's...

From Xymphora March 21, 2019.

"Truth or Trope?" (Sailer):

"Of the top 50 political donors to either party at the federal level in 2018, 52 percent were Jewish and 48 percent were gentile. Individuals who identify as Jewish are usually estimated to make up perhaps 2.2 percent of the population.
Of the $675 million given by the top 50 donors, 66 percent of the money came from Jews and 34 percent from gentiles.
Of the $297 million that GOP candidates and conservative causes received from the top 50 donors, 56 percent was from Jewish individuals.
Of the $361 million Democratic politicians and liberal causes received, 76 percent came from Jewish givers.
So it turns out that Rep. Omar and Gov. LePage appear to have been correct, at least about the biggest 2018 donors. But you can also see why Pelosi wanted Omar to just shut up about it: 76 percent is a lot."

Erelis , Mar 23, 2019 9:35:12 PM | link
Next up another false flag operation. The thing is, it would have be non-trivial and involving the harming of people to jolt the narrative back to that favoring the deep state. And taking off the proverbial media table, that Mueller found no collusion. Yes, election in 2016 no collusion, but Putin was behind the latest horrific false flag, "oh look, Trump is not confronting Putin"...
daffyDuct , Mar 23, 2019 9:40:02 PM | link

Not even getting into the "treason", "putin's c*ckholster", "what's the time on Moscow, troll!" crap we've been subjected to for 3 years, please enjoy this mashup: https://www.youtube.com/watch?v=qjUvfZj-Fm0.

mourning dove , Mar 23, 2019 9:54:13 PM | link
Jackrabbit,

I've said before that she's a terrible strategist and she ran a terrible campaign and she's terribly out of touch. I think she expected a cake walk and was relying on Trump being so distasteful to voters that they'd have no other option.

I think Trump legitimately won the election and I don't believe for a second that she won the popular vote. There were so many problems with the election but since they were on the losing side, nobody cares. In 2012 I didn't know anyone else who was voting for Jill Stein, way too many people were still in love with Obama. She got .4% of the vote. In 2016 most of the people I knew were voting for Jill Stein, she drew a large crowd from DemExit, but they say she got .4% of the vote. Total bullshit. There was also ballot stuffing and lots of other problems, but it still wasn't enough.

I'm also convinced that Trump and Clinton colluded, but that they did so in order to get her elected. I don't think he really wanted the job. But still, Hillary can do nationalist, and the designs of the Empire would have proceeded either way.

jadan , Mar 23, 2019 9:56:37 PM | link

Trump is a crook who takes money wherever he can get it, from subcontractors foolish enough to work for him to bankers dumb enough to believe his financial statements. No doubt he has helped Russian crooks sanitize their booty, but that is apparently too difficult for Mueller to prove.

It is not good news that this troglodyte was not indicted, but it is good news that Russia was not found guilty of electing him. Russiagate is an existential issue for the "national security" establishment and just another propaganda offensive designed to justify the largely useless & destructive activities of the Pentagon.

It is time to build cooperation not continue the stupidity of US unilateralism and pursuit of global hegemony. Trump and his team have to be removed from office. Democrats don't need Russiagate to do it. The truth will work better.

[Mar 23, 2019] Killing for Credibility A Look Back at the 1999 NATO Air War on Serbia by Brett Wilkins

Mar 23, 2019 | original.antiwar.com

This month marks the 20th anniversary of Operation Allied Force, NATO's 78-day air war against Yugoslavia. It was a war waged as much against Serbian civilians – hundreds of whom perished – as it was against Slobodan Milošević's forces, and it was a campaign of breathtaking hypocrisy and selective outrage. More than anything, it was a war that by President Bill Clinton's own admission was fought for the sake of NATO's credibility.

One Man's Terrorist

Our story begins not in the war-torn Balkans of the 1990s but rather in the howling wilderness of Afghanistan at the end of the 1980s as defeated Soviet invaders withdrew from a decade of guerrilla warfare into the twilight of a once-mighty empire. The United States, which had provided arms, funding and training for the mujahideen fighters who had so bravely resisted the Soviet occupation, stopped supporting the jihadis as soon as the last Red Army units rolled across the Hairatan Bridge and back into the USSR. Afghanistan descended deeper into civil war.

The popular narrative posits that Osama bin Laden and his al-Qaeda network, Washington's former mujahideen allies, turned on the West after the US stationed hundreds of thousands of infidel troops in Saudi Arabia – home to two out of three of Sunni Islam's holiest sites – during Operation Desert Shield in 1990. Since then, the story goes, the relationship between the jihadists and their former benefactors has been one of enmity, characterized by sporadic terror attacks and fierce US retribution. The real story, however, is something altogether different.

From 1992 to 1995, the Pentagon flew thousands of al-Qaeda mujahideen, often accompanied by US Special Forces, from Central Asia to Europe to reinforce Bosnian Muslims as they fought Serbs to gain their independence from the Federal Republic of Yugoslavia. The Clinton administration armed and trained these fighters in flagrant violation of United Nations accords; weapons purchased by Saudi Arabia, Turkey and Iran were secretly shipped to the jihadists via Croatia, which netted a hefty profit from each transaction. The official Dutch inquiry into the 1995 Srebrenica massacre, in which thousands of Bosniak (Bosnian Muslim) men and boys were slaughtered by Bosnian Serb and Serbian paramilitary forces, concluded that the United States was "very closely involved" in these arms transfers.

When the Bosnian war ended in 1995 the United States was faced with the problem of thousands of Islamist warriors on European soil. Many of them joined the burgeoning Kosovo Liberation Army (KLA), which mainly consisted of ethnic Albanian Kosovars from what was still southwestern Yugoslavia. Emboldened by the success of the Slovenes, Croats, Macedonians and Bosnians who had won their independence from Belgrade as Yugoslavia literally balkanized, KLA fighters began to violently expel as many non-Albanians from Kosovo as they could. Roma, Jews, Turks and, above all, Serbs were all victims of Albanian ethnic cleansing.

The United States was initially very honest in its assessment of the KLA. Robert Gelbard, the US special envoy to Bosnia, called it "without any question a terrorist group." KLA backers allegedly included Osama bin Laden and other Islamic radicals; the group largely bankrolled its activities by trafficking heroin and sex slaves. The State Department accordingly added the KLA to its list of terrorist organizations in 1998.

However, despite all its nastiness the KLA endeared itself to Washington by fighting the defiant Yugoslavian President Slobodan Milošević. By this time Yugoslavia, once composed of eight nominally autonomous republics, had been reduced by years of bloody civil war to a rump of Serbia, Montenegro and Kosovo. To Serbs, the dominant ethnic group in what remained of the country, Kosovo is regarded as the very birthplace of their nation. Belgrade wasn't about to let it go without a fight and everyone knew it, especially the Clinton administration. Clinton's hypocrisy was immediately evident; when Chechnya fought for its independence from Moscow and Russian forces committed horrific atrocities in response, the American president called the war an internal Russian affair and barely criticized Russian President Boris Yeltsin. But when Milošević resorted to brute force in an attempt to prevent Yugoslavia from further fracturing, he soon found himself a marked man.

Although NATO called the KLA "the main initiator of the violence" in Kosovo and blasted "what appears to be a deliberate campaign of provocation" against the Serbs, the Clinton administration was nevertheless determined to attack the Milošević regime. US intelligence confirmed that the KLA was indeed provoking harsh retaliatory strikes by Serb forces in a bid to draw the United States and NATO into the conflict. President Clinton, however, apparently wasn't listening. The NATO powers, led by the United States, issued Milošević an ultimatum they knew he could never accept: allow NATO to occupy all of Kosovo and have free reign in Serbia as well. Assistant US Secretary of State James Rubin later admitted that "publicly we had to make clear we were seeking an agreement but privately we knew the chances of the Serbs agreeing were quite small."

Wagging the Dog?

In 1997 the film Wag the Dog debuted to rave reviews. The dark comedy concerns a Washington, DC spin doctor and a Hollywood producer who fabricate a fictional war in Albania to distract American voters from a presidential sex scandal. Many observers couldn't help but draw parallels between the film and the real-life events of 1998-99, which included the Monica Lewinsky scandal, Clinton's impeachment and a very real war brewing in the Balkans. As in Wag the Dog , there were exaggerated or completely fabricated tales of atrocities, and as in the film the US and NATO powers tried to sell their war as a humanitarian intervention. An attack on Yugoslavia, we were told, was needed to avert Serb ethnic cleansing of Albanians.

There were two main problems with this. First, there was no Serb ethnic cleansing of Albanian Kosovars until after NATO began mercilessly bombing Yugoslavia. The German government issued several reports confirming this. One, from October 1998, reads, in part:

The violent actions of the Yugoslav military and police since February 1998 were aimed at separatist activities and are no proof of a persecution of the whole Albanian ethnic group in Kosovo or a part of it. What was involved in the Yugoslav violent actions and excesses since February 1998 was a selective forcible action against the military underground movement (especially the KLA) A state program or persecution aimed at the whole ethnic group of Albanians exists neither now nor earlier.

Subsequent German government reports issued through the winter of 1999 tell a similar story. "Events since February and March 1998 do not evidence a persecution program based on Albanian ethnicity," stated one report released exactly one month before the NATO bombing started. "The measures taken by the armed Serbian forces are in the first instance directed toward combating the KLA and its supposed adherents and supporters."

While Serbs certainly did commit atrocities (especially after the ferocious NATO air campaign began), these were often greatly exaggerated by the Clinton administration and the US corporate mainstream media. Clinton claimed – and the media dutifully parroted – that 600,000 Albanians were "trapped within Kosovo lacking shelter, short of food, afraid to go home or buried in mass graves." This was completely false . US diplomat David Scheffer claimed that "225,000 ethnic Albanian men are missing, presumed dead." Again, a total fabrication . The FBI, International War Crimes Tribunal and global forensics experts flocked to Kosovo in droves after the NATO bombs stopped falling; the total number of victims they found was around 1 percent of the figure claimed by the United States.

However, once NATO attacked, the Serb response was predictably furious. Shockingly, NATO commander Gen. Wesley Clark declared that the ensuing Serbian atrocities against the Albanian Kosovar population had been "fully anticipated" and were apparently of little concern to Washington. Not only did NATO and the KLA provoke a war with Yugoslavia, they did so knowing that many innocent civilians would be killed, maimed or displaced by the certain and severe reprisals carried out by enraged Serb forces. Michael McGwire, a former top NATO planner, acknowledged that "to describe the bombing as a humanitarian intervention is really grotesque."

Bloody Hypocrites

The other big problem with the US claiming it was attacking Yugoslavia on humanitarian grounds was that the Clinton administration had recently allowed – and was at the time allowing – far worse humanitarian catastrophes to rage without American intervention. More than 800,000 men, women and children were slaughtered while Clinton and other world leaders stood idly by during the 1994 Rwandan genocide. The US also courted the medievally brutal Taliban regime in hopes of achieving stability in Afghanistan and with an eye toward building a gas pipeline from Turkmenistan through Afghanistan to Pakistan. Clinton also did nothing to stop Russian forces from viciously crushing nationalist uprisings in the Caucuses, where Chechen rebels were fighting for their independence much the same as Albanian Kosovars were fighting the Serbs.

Colombia, the Western Hemisphere's leading recipient of US military and economic aid, was waging a fierce, decades-long campaign of terror against leftist insurgents and long-suffering indigenous peoples. Despite horrific brutality and pervasive human rights violations, US aid to Bogotá increased year after year. In Turkey, not only did Clinton do nothing to prevent government forces from committing widespread atrocities against Kurdish separatists, the administration positively encouraged its NATO ally with billions of dollars in loans and arms sales. Saudi Arabia, home to the most repressive fundamentalist regime this side of Afghanistan, was – and remains – a favored US ally despite having one of the world's worst human rights records. The list goes on and on.

Much closer to the conflict at hand, the United States tacitly approved the largest ethnic cleansing campaign in Europe since the Holocaust when as many as 200,000 Serbs were forcibly expelled from the Krajina region of Croatia by that country's US-trained military during Operation Storm in August 1995. Krajina Serbs had purged the region of its Croat minority four years earlier in their own ethnic cleansing campaign; now it was the Serbs' turn to be on the receiving end of the horror. Croatian forces stormed through Krajina, shelling towns and slaughtering innocent civilians. The sick and the elderly who couldn't escape were executed or burned alive in their homes as Croatian soldiers machine-gunned convoys of fleeing refugees.

"Painful for the Serbs"

Washington's selective indignation at Serb crimes both real and imagined is utterly inexcusable when held up to the horrific and seemingly indiscriminate atrocities committed during the NATO air campaign against Yugoslavia. The prominent Australian journalist John Pilger noted that "in the attack on Serbia, 2 percent of NATO's missiles hit military targets, the rest hit hospitals, schools, factories, churches and broadcast studios." There is little doubt that US and allied warplanes and missiles were targeting the Serbian people as much as, or even more than, Serb forces. The bombing knocked out electricity in 70 percent of the country as well as much of its water supply.

NATO warplanes also deliberately bombed a building containing the headquarters of Serbian state television and radio in the middle of densely populated central Belgrade. The April 23, 1999 attack occurred without warning while 200 employees were at work in the building. Among the 16 people killed were a makeup artist, a cameraman, a program director, an editor and three security guards. There is no doubt that the attack was meant to demoralize the Serbian people. There is also no doubt that those who ordered the bombing knew exactly what outcome to expect: a NATO planning document viewed by Bill Clinton, UK Prime Minister Tony Blair and French President Jacques Chirac forecast as many as 350 deaths in the event of such an attack, with as many as 250 of the victims expected to be innocent civilians living in nearby apartments.

Allied commanders wanted to fight a "zero casualty war" in Yugoslavia. As in zero casualties for NATO forces, not the people they were bombing. "This will be painful for the Serbs," Pentagon spokesman Kenneth Bacon sadistically predicted. It sure was. NATO warplanes flew sorties at 15,000 feet (4,500 meters), a safe height for the pilots. But this decreased accuracy and increased civilian casualties on the ground. One attack on central Belgrade mistakenly hit Dragiša Mišović hospital with a laser-guided "precision" bomb, obliterating an intensive care unit and destroying a children's ward while wounding several pregnant women who had the misfortune of being in labor at the time of the attack. Dragana Krstić, age 23, was recovering from cancer surgery – she just had a 10-pound (4.5 kg) tumor removed from her stomach – when the bombs blew jagged shards of glass into her neck and shoulders. "I don't know which hurts more," she lamented, "my stomach, my shoulder or my heart."

Dragiša Mišović wasn't the only hospital bombed by NATO. Cluster bombs dropped by fighter jets of the Royal Netherlands Air Force struck a hospital and a market in the city of Niš on May 7, killing 15 people and wounding 60 more. An emergency clinic and medical dispensary were also bombed in the mining town of Aleksinac on April 6, killing at least five people and wounding dozens more.

Bridges were favorite targets of NATO bombing. An international passenger train traveling from Belgrade to Thessaloniki, Greece was blown apart by two missiles as it crossed over Grdelica gorge on April 12. Children and a pregnant woman were among the 15 people killed in the attack; 16 other passengers were wounded. Allied commander Gen. Wesley Clark claimed the train, which had been damaged by the first missile, had been traveling too rapidly for the pilot to abort the second strike on the bridge. He then offered up a doctored video that was sped up more than three times so that the pilot's behavior would appear acceptable.

On May 1, at least 24 civilians, many of them children, were killed when NATO warplanes bombed a bridge in Lužane just as a bus was crossing. An ambulance rushing to the scene of the carnage was struck by a second bomb. On the sunny spring afternoon of May 30, a bridge over the Velika Morava River in the small town of Vavarin was bombed by low-flying German Air Force F-16 fighters while hundreds of local residents gathered nearby to celebrate an Orthodox Christian holiday. Eleven people died, most of them when the warplanes returned and bombed the people who rushed to the bridge to help those wounded in the first strike.

No One Is Safe

The horrors suffered by the villagers of Surdulica shows that no one in Serbia was safe from NATO's fury. They endured some 175 bombardments during one three-week period alone, with 50 houses destroyed and 600 others damaged in a town with only around 10,000 residents. On April 27, 20 civilians, including 12 children, died when bombs meant to destroy an army barracks slammed into a residential neighborhood. As many as 100 others were wounded in the incident. Tragedy befell the tiny town again on May 31 when NATO warplanes returned to bomb an ammunition depot but instead hit an old people's home; 23 civilians, most of them helpless elderly men and women, were blown to pieces. Dozens more were wounded. The US military initially said "there were no errant weapons" in the attack. However, Deputy Defense Secretary John Hamre later testified before Congress that it "was a case of the pilot getting confused."

The CIA was also apparently confused when it relied on what it claimed was an outdated map to approve a Stealth Bomber strike on what turned out to be the Chinese Embassy in Belgrade. Three Chinese journalists were killed and 27 other people were wounded. Some people aren't so sure the attack was an accident – Britain's Observer later reported that the US deliberately bombed the embassy after discovering it was being used to transmit Yugoslav army communications.

There were plenty of other accidents, some of them horrifically tragic and others just downright bizarre. Two separate attacks on the very Albanians NATO was claiming to help killed 160 people, many of them women and children. On April 14, NATO warplanes bombed refugees along a 12-mile (19-km) stretch of road between the towns of Gjakova and Deçan in western Kosovo, killing 73 people including 16 children and wounding 36 more. Journalists reported a grisly scene of "bodies charred or blown to pieces, tractors reduced to twisted wreckage and houses in ruins." Exactly one month later, another column of refugees was bombed near Koriša, killing 87 – mostly women, children and the elderly – and wounding 60 others. In the downright bizarre category, a wildly errant NATO missile struck a residential neighborhood in the Bulgarian capital Sofia, some 40 miles (64 km) outside of Serbia. The American AGM-88 HARM missile blew the roof off of a man's house while he was shaving in his bathroom.

NATO's "Murderous Thugs"

As the people of Yugoslavia were being terrorized by NATO's air war, the terrorists of the Kosovo Liberation Army stepped up their atrocities against Serbs and Roma in Kosovo. NATO troops deployed there to keep the peace often failed to protect these people from the KLA's brutal campaign. More than 164,000 Serbs fled or were forcibly driven from the Albanian-dominated province and by the summer of 2001 KLA ethnic cleansing had rendered Kosovo almost entirely Albanian, with just a few die-hard Serb holdouts living in fear and surrounded by barbed wire.

The KLA soon expanded its war into neighboring Macedonia. Although NATO Secretary-General Lord Robertson called the terror group "murderous thugs," the United States – now with George W. Bush as president – continued to offer its invaluable support. National Security Advisor Condoleezza Rice personally intervened in an attempt to persuade Ukraine to halt arms sales to the Macedonian army and when a group of 400 KLA fighters were surrounded at Aracinovo in June 2001, NATO ordered Macedonian forces to hold off their attack while a convoy of US Army vehicles rescued the besieged militants. It later emerged that 17 American military advisers were embedded with the KLA at Aracinovo.

Credibility Conundrum

The bombing of Yugoslavia was really about preserving the credibility of the United States and NATO. The alliance's saber rattling toward Belgrade had painted it into a corner from which the only way out was with guns blazing. Failure to follow threats with deadly action, said President Clinton, "would discredit NATO." Clinton added that "our mission is clear, to demonstrate the seriousness of NATO's purpose." The president seemed willfully ignorant of NATO's real purpose, which is to defend member states from outside attack. British Prime Minister Tony Blair agreed with Clinton, declaring on the eve of the war that "to walk away now would destroy NATO's credibility." Gary Dempsey, a foreign policy analyst at the libertarian Cato Institute, wrote that the Clinton administration "transformed a conflict that posed no threat to the territorial integrity, national sovereignty or general welfare of the United States into a major test of American resolve."

Waging or prolonging war for credibility's sake is always dangerous and seems always to yield disastrous results. Tens of thousands of US troops and many times as many Vietnamese, Laotian and Cambodian soldiers and civilians died while Richard Nixon sought an "honorable" way out of Vietnam. Ronald Reagan's dogged defense of US credibility cost the lives of 299 American and French troops killed in Hezbollah's 1983 Beirut barracks bombing. This time, ensuring American credibility meant backing the vicious KLA – some of whose fighters had trained at Osama bin Laden's terror camps in Afghanistan. This, despite the fact that al-Qaeda had already been responsible for deadly attacks against the United States, including the 1998 embassy bombings in Kenya and Tanzania.

It is highly questionable whether bombing Yugoslavia affirmed NATO's credibility in the short term. In the long term, it certainly did not. The war marked the first and only time NATO had ever attacked a sovereign state. It did so unilaterally, absent any threat to any member nation, and without the approval of the United Nations Security Council. "If NATO can go for military action without international blessing, it calls into question the reliability of NATO as a security partner," Russian Ambassador Sergey Kislyak, then Moscow's ambassador to NATO, told me at a San Francisco reception.

Twenty years later, Operation Allied force has been all but forgotten in the United States. In a country that has been waging nonstop war on terrorism for almost the entire 21st century, the 1999 NATO air war is but a footnote in modern American history. Serbs, however, still seethe at the injustice and hypocrisy of it all. The bombed-out ruins of the old Yugoslav Ministry of Defense, Radio Television of Serbia headquarters and other buildings serve as constant, painful reminders of the horrors endured by the Serbian people in service of NATO's credibility.

Brett Wilkins is a San Francisco-based author and activist. His work, which focuses on issues of war and peace and human rights, is archived at www.brettwilkins.com

Read more by Brett Wilkins

[Mar 20, 2019] What Republicans and Billionaires Really Mean When They Talk About 'Freedom' by Thom Hartman

Mar 20, 2019 | www.nakedcapitalism.com

Yves here. This post focuses on an important slice of history in what "freedom" has meant in political discourse in the US. But I wish it had at least mentioned how a well-funded, then extreme right wing effort launched an open-ended campaign to render US values more friendly to business. They explicitly sought to undo New Deal programs and weaken or end other social safety nets. Nixon Supreme Court Justice Lewis Powell codified the strategy for this initiative in the so-called Powell Memo of 1971.

One of the most effective spokesmen for this libertarian program was Milton Friedman, whose bestseller Free to Choose became the foundation for a ten-part TV series.

By Thom Hartman, a talk-show host and author of more than 25 books in print . He is a writing fellow at the Independent Media Institute . Produced by the Independent Media Institute

America is having a heated debate about the meaning of the word socialism . We'd be better served if, instead, we were debating the meaning of freedom .

The Oregonian reported last week that fully 156,000 families are on the edge of homelessness in our small-population state. Every one of those households is now paying more than 50 percent of its monthly income on rent, and none of them has any savings; one medical bill, major car repair or job loss, and they're on the streets.

While socialism may or may not solve their problem, the more pressing issue we have is an entire political party and a huge sector of the billionaire class who see homelessness not as a problem, but as a symptom of a "free" society.

The words freedom and liberty are iconic in American culture -- probably more so than with any other nation because they're so intrinsic to the literature, declarations and slogans of our nation's founding.

The irony -- of the nation founded on the world's greatest known genocide (the systematic state murder of tens of millions of Native Americans) and over three centuries of legalized slavery and a century and a half of oppression and exploitation of the descendants of those slaves -- is extraordinary. It presses us all to bring true freedom and liberty to all Americans.

But what do those words mean?

If you ask the Koch brothers and their buddies -- who slap those words on pretty much everything they do -- you'd get a definition that largely has to do with being "free" from taxation and regulation. And, truth be told, if you're morbidly rich, that makes a certain amount of sense, particularly if your main goal is to get richer and richer, regardless of your behavior's impact on working-class people, the environment, or the ability of government to function.

On the other hand, the definition of freedom and liberty that's been embraced by so-called "democratic socialist" countries -- from Canada to almost all of Europe to Japan and Australia -- you'd hear a definition that's closer to that articulated by Franklin D. Roosevelt when he proposed, in January 1944, a " second Bill of Rights " to be added to our Constitution.

FDR's proposed amendments included the right to a job, and the right to be paid enough to live comfortably; the right to "adequate food and clothing and recreation"; the right to start a business and run it without worrying about "unfair competition and domination by monopolies"; the right "of every family to a decent home"; the right to "adequate medical care to achieve and enjoy good health"; the right to government-based "protection from the economic fears of old age, sickness, accident, and unemployment"; and the right "to a good education."

Roosevelt pointed out that, "All of these rights spell security." He added, "America's own rightful place in the world depends in large part upon how fully these and similar rights have been carried into practice for our citizens. For unless there is security here at home there cannot be lasting peace in the world."

The other nations mentioned earlier took President Roosevelt's advice to heart. Progressive "social democracy" has kept Europe, Canada, and the developed nations of the East and South Pacific free of war for almost a century -- a mind-boggling feat when considering the history of the developed world since the 1500s.

Just prior to FDR winning the White House in the election of 1932, the nation had been treated to 12 years of a bizarre Republican administration that was the model for today's GOP. In 1920, Warren Harding won the presidency on a campaign of "more industry in government, less government in industry" -- privatize and deregulate -- and a promise to drop the top tax rate of 91 percent down to 25 percent.

He kept both promises, putting the nation into a sugar-high spin called the Roaring '20s, where the rich got fabulously rich and working-class people were being beaten and murdered by industrialists when they tried to unionize. Harding, Coolidge, and Hoover (the three Republican presidents from 1920 to 1932) all cheered on the assaults, using phrases like "the right to work" to describe a union-free nation.

In the end, the result of the " horses and sparrows " economics advocated by Harding ("feed more oats to the horses and there'll be more oats in the horse poop to fatten the sparrows" -- that generation's version of trickle-down economics) was the Republican Great Depression (yes, they called it that until after World War II).

Even though Roosevelt was fabulously popular -- the only president to be elected four times -- the right-wingers of his day were loud and outspoken in their protests of what they called "socialist" programs like Social Security, the right to unionize, and government-guaranteed job programs including the WPA, REA, CCC, and others.

The Klan and American Nazis were assembling by the hundreds of thousands nationwide -- nearly 30,000 in Madison Square Garden alone -- encouraged by wealthy and powerful "economic royalists" preaching "freedom" and " liberty ." Like the Kochs' Freedomworks , that generation's huge and well-funded (principally by the DuPonts' chemical fortune) organization was the Liberty League .

Roosevelt's generation had seen the results of this kind of hard-right "freedom" rhetoric in Italy, Spain, Japan and Germany, the very nations with which we were then at war.

Speaking of "the grave dangers of 'rightist reaction' in this Nation," Roosevelt told America in that same speech that: "[I]f history were to repeat itself and we were to return to the so-called 'normalcy' of the 1920s -- then it is certain that even though we shall have conquered our enemies on the battlefields abroad, we shall have yielded to the spirit of Fascism here at home."

Although right-wingers are still working hard to disassemble FDR's New Deal -- the GOP budget for 2019 contains massive cuts to Social Security, as well as to Medicare and Medicaid -- we got halfway toward his notion of freedom and liberty here in the United States:

You're not free if you're old and deep in poverty, so we have Social Security (although the GOP wants to gut it). You're not free if you're hungry, so we have food stamps/SNAP (although the GOP wants to gut them). You're not free if you're homeless, so we have housing assistance and homeless shelters (although the GOP fights every effort to help homeless people). You're not free if you're sick and can't get medical care, so we have Medicare, Medicaid, and Obamacare (although the GOP wants to gut them all). You're not free if you're working more than 40 hours a week and still can't meet basic expenses, so we have minimum wage laws and the right to unionize (although the GOP wants to gut both). You're not free if you can't read, so we have free public schools (although the GOP is actively working to gut them). You're not free if you can't vote, so we've passed numerous laws to guarantee the right to vote (although the GOP is doing everything it can to keep tens of millions of Americans from voting).

The billionaire class and their wholly owned Republican politicians keep trying to tell us that "freedom" means the government doesn't provide any of the things listed above.

Instead, they tell us (as Ron Paul famously did in a GOP primary debate years ago) that, if we're broke and sick, we're "free" to die like a feral dog in the gutter.

Freedom is homelessness, in the minds of the billionaires who own the GOP.

Poverty, lack of education, no access to health care, poor-paying jobs, and barriers to voting are all proof of a free society, they tell us, which is why America's lowest life expectancy, highest maternal and childhood death rates, lowest levels of education, and lowest pay are almost all in GOP-controlled states .

America -- particularly the Democratic Party -- is engaged in a debate right now about the meaning of socialism . It would be a big help for all of us if we were, instead, to have an honest debate about the meaning of the words freedom and liberty .



cuibono , , March 20, 2019 at 2:53 am

Know Your Rights: https://www.youtube.com/watch?v=5lfInFVPkQs

WheresOurTeddy , , March 20, 2019 at 12:28 pm

I have been informed by Fox that knowing your rights is un-American

everydayjoe , , March 20, 2019 at 4:26 am

Let us not forget the other propaganda arm of Republican party and big money- Fox news. They spew the freedom nonsense while not adhering to any definition of the word.

I worked in the midwest as an Engineer in the 90s to early 2000s and saw plants being gutted/shifted overseas, Union influence curtailed and mid level and bottom pay stay flat for decades; all in the name of free market.

Sadly the same families that are the worst affected vote Republican! But we know all this and have known it for a while. What will change?

lyman alpha blob , , March 20, 2019 at 8:00 am

They want freedom -- for the wolves to eat the sheep.

PKMKII , , March 20, 2019 at 1:08 pm

And then act like it's fair because they don't have laws against the sheep eating the wolves.

Norb , , March 20, 2019 at 8:39 am

The intro to this post is spot on. The Powell memo outlined a strategy for a corporate coup d'eta. Is was completely successful. Now that the business class rules America, their only vision is to continue the quest and cannibalize the country and enslave its people by any means possible. What tools do they use to achieve these ends? -- debt, fear, violence and pandering to human vanity as a motivator. Again, very successful.

Instead of honest public debate- which is impossible when undertaken with liars and thieves, a good old manifesto or pamphlet like Common Sense is in order. Something calling out concrete action that can be taken by commoners to regain their social respect and power. That should scare the living daylights out of the complacent and smug elite.

Its that, or a lot of public infrastructure is gong to be broken up by the mob- which doesn't work out in the long run. The nations that learn to work with and inspire their populations will prosper- the rest will have a hard time of it. Look no further than America's fall.

Carla , , March 20, 2019 at 12:00 pm

Thank you, Norb. You've inspired me to start by reading Common Sense.

Jamie S , , March 20, 2019 at 9:13 am

This piece raises some important points, but aims too narrowly at one political party, when the D-party has also been complicit in sharing the framing of "freedom" as less government/regulation/taxation. After all, it was the Clinton administration that did welfare "reform", deregulation of finance, and declared the end of the era of "big government", and both Clinton and Obama showed willingness to cut Social Security and Medicare in a "grand bargain".

WJ , , March 20, 2019 at 12:10 pm

+100

If in place of "the GOP," the author had written, "The national Democratic and Republican parties over the past fifty years," his claim would be much more accurate. To believe what he says about "the GOP," you have to pretend that Clinton, and Obama, and Pelosi, and Schumer, and Feinstein simply don't exist and never did. The author's implicit valorization of Obamacare is even more disheartening.

But perhaps this is the *point* of the piece after all? If I were a consultant to the DNC (and I make less than $100,000/yr so I am clearly not), I would advocate that they commission, underscore, and reward pieces exactly like this one. For the smartest ones surely grasp that the rightist oligarchic policy takeover has in fact happened, and that it has left in its wake millions of disaffected, indebted, uneducated, uninsured Americans.

(Suggesting that it hadn't was the worst idiocy of Clinton's 2016 campaign. It would have been much better had she admitted it and blamed it on the Republican Senate while holding dear old Obama up as a hamstrung martyr for the cause. I mean, this is what everybody at DailyKos already believes, and the masses -- being poor and uneducated and desperate -- can be brought around to believe anything, or anyway, enough of them can be.)

I would advocate that the DNC double down on its rightful claims to Roosevelt's inheritance, embrace phrases like "social democracy" and "freedom from economic insecurity," and shift leftward in all its official rhetoric. Admit the evisceration of the Roosevelt tradition, but blame it all on the GOP. Maybe *maybe* even acknowledge that past Democratic leaders were a little naive and idealistic in their pursuit of bipartisanship, and did not understand the truly horrible intentions of the GOP. But today's Democrats are committed to wresting back the rights of the people from the evil clutches of the Koch Republicans. This sort of thing.

Would my advice be followed? Or would the *really* smart ones in the room demure? If so, why do you think they would?

In short, I read this piece as one stage in an ongoing dialectic in the Democratic Party in the run-up to the 2020 election wherein party leaders try to determine how leftward its "official" rhetoric is able to sway before becoming *so* unbelievable (in light of historical facts) that it cannot serve as effective propaganda -- even among Americans!

NotTimothyGeithner , , March 20, 2019 at 1:34 pm

Team Blue elites are the children of Bill Clinton and the Third Way, so the echo chamber was probably terrible. Was Bill Clinton a bad President? He was the greatest Republican President! The perception of this answer is a key. Who rose and joined Team Blue through this run? Many Democrats don't recognize this, or they don't want to rock the boat. This is the structural problem with Team Blue. The "generic Democrat" is AOC, Omar, Sanders, Warren, and a handful of others.

Can the Team Blue elites embrace a Roosevelt identity? The answer is no. Their ideology is so wildly divergent they can't adjust without a whole sale conversion.

More succinctly, the Third Way isn't about helping Democrats win by accepting not every battle can be won. Its about advancing right wing politics and pretending this isn't what its about. If they are too clear about good policy, they will be accused of betrayal.

jefemt , , March 20, 2019 at 9:18 am

Freedom's just another word for nothin' left to lose Kris Kristofferson

shinola , , March 20, 2019 at 1:06 pm

"nothin' ain't worth nothin' but it's free"
;)

Trick Shroade , , March 20, 2019 at 9:46 am

The modern GOP has a very brutalist interpretation of Christianity, one where the money changers bring much needed liquidity to the market.

where , , March 20, 2019 at 12:30 pm

it's been 2 generations, but we assure you, the wealth will eventually trickle down

Dwight , , March 20, 2019 at 1:51 pm

Be patient, the horse has to digest your oat.

The Rev Kev , , March 20, 2019 at 10:13 am

This article makes me wonder if the GOP is still a political party anymore. I know, I know, they have the party structure, the candidates, the budget and all the rest of it but when you look at their policies and what they are trying to do, the question does arise. Are they doing it because this is what they believe is their identity as a party or is it that they are simply a vehicle with the billionaires doing the real driving and recruiting? An obvious point is that among billionaires, they see no need to form their own political party which should be telling clue. Certainly the Democrats are no better.

Maybe the question that American should ask themselves is just what does it mean to be an American in the year 2020? People like Norman Rockwell and his Four Freedoms could have said a lot of what it meant some 60 years ago and his work has been updated to reflect the modern era ( https://www.galeriemagazine.com/norman-rockwell-four-freedoms-modern/ ) but the long and the short of it is that things are no longer working for most people anymore -- and not just in America. But a powerful spring can only be pushed back and held in place for so long before there is a rebound effect and I believe that I am seeing signs of this the past few years.

GF , , March 20, 2019 at 11:06 am

And don't forget FRD's Second Bill of Rights:

" a second Bill of Rights under which a new basis of security and prosperity can be established for all -- regardless of station, race, or creed.

Among these are:

The right to a useful and remunerative job in the industries or shops or farms or mines of the nation;
The right to earn enough to provide adequate food and clothing and recreation;
The right of every farmer to raise and sell his products at a return which will give him and his family a decent living;
The right of every businessman, large and small, to trade in an atmosphere of freedom from unfair competition and domination by monopolies at home or abroad;
The right of every family to a decent home;
The right to adequate medical care and the opportunity to achieve and enjoy good health;
The right to adequate protection from the economic fears of old age, sickness, accident, and unemployment;
The right to a good education.
All of these rights spell security."

Frank Little , , March 20, 2019 at 10:20 am

America is having a heated debate about the meaning of the word socialism. We'd be better served if, instead, we were debating the meaning of freedom.

I agree, and we should also be having a debate about capitalism as it actually exists. In the US capitalism is always talked about in rosy non-specific terms (e.g. a preference for markets or support for entrepreneurship) while anybody who says they don't necessarily support capitalism has to answer for Stalin's gulag's or the Khmer Rouge. All the inequalities and injustices that have helped people like Howard Schultz or Jeff Bezos become billionaire capitalists somehow aren't part of capitalism, just different problems to be solved somehow but definitely not by questioning capitalism.

Last night I watched the HBO documentary on Elizabeth Holmes and Theranos and I couldn't help but laugh at all these powerful politicians, investors, and legal giants going along with someone who never once demonstrated or even explained how her groundbreaking innovation actually worked. $900 million was poured into that company before people realized something that a Stanford professor interviewed in the documentary saw when she first met Holmes. Fracking companies have been able to consistently raise funding despite consistently losing money and destroying the environment in the process. Bank balance sheets were protected while working people lost everything in the name of preserving American capitalism. I think it's good to debate socialism and capitalism, but there's not really any point if we aren't going to be talking about Actually Existing Capitalism rather than the hypothetical version that's trotted out anytime someone suggests an alternative.

Trick Shroade , , March 20, 2019 at 10:53 am

There was a great comment here on NC a little while ago, something to the effect of "capitalism has the logic of a cancer cell. It's a pile of money whose only goal is to become a bigger pile of money." Of course good things can happen as a side effect of it becoming a bigger pile of money: innovation, efficiencies, improved standard of living, etc. but we need government (not industry) regulation to keep the bad side effects of capitalism in check (like the cancer eventually killing its host).

Carey , , March 20, 2019 at 12:21 pm

"efficiency" is very often not good for the Commons, in the long term.

Frank Little , , March 20, 2019 at 12:31 pm

Shoot, must have missed that comment but it's a good metaphor. Reminds me of Capital vol. 1, which Marx starts with a long and dense treatment of the nature of commodities and commodification in order to capture this process whereby capitalists produce things people really do want or need in order to get at what they really want: return on their investment.

Jack Gavin , , March 20, 2019 at 12:36 pm

I also agree but I think we need to have a the same heated debate over what capitalism means. Over the years I have been subjected to (exposed) to more flavors of socialism than I can count. Yet, other than an introductory economics class way back when, no debatable words about what 'capitalism' is seems to get attention. Maybe it's time to do that and hope that some agreeable definition of 'freedom' falls out.

jrs , , March 20, 2019 at 12:42 pm

of course maybe socialism is the only thing that ever really could solve homelessness, given that it seems to be at this point a worldwide problem, although better some places than others (like the U.S. and UK).

Stratos , , March 20, 2019 at 11:11 am

This article lets the Dems off the hook. They have actively supported the Billionaire Agenda for decades now; sometimes actively (like when they helped gut welfare) and sometimes by enabling Repubs objectives (like voter suppression).

At this point in time, the Dem leadership is working to deep six Medicare for All.

With 'friends' like the Dems, who needs the Repubs?

WheresOurTeddy , , March 20, 2019 at 12:30 pm

our last democratic president was Carter

thump , , March 20, 2019 at 12:38 pm

1) In the history, a mention of the attempted coup against FDR would be good. See The Plot to Seize the White House by Jules Archer. ( Amazon link )

2) For the contemporary intellectual history, I really appreciated Nancy MacLean's Democracy in Chains . ( Amazon link ) Look her up on youtube or Democracy Now . Her book got a bit of press and she interviews well.

Bob of Newton , , March 20, 2019 at 1:58 pm

Please refer to these folks as 'rightwingers'. There are Democratic as well as Republicans who believe in this type of 'freedom'.

Jerry B , , March 20, 2019 at 2:38 pm

This post seems heavily slanted against the GOP and does not take into account how pro-business the Democrats have become. I tenuously agree with Yves intro that much of the current pro business value system campaign in the US was started with the political far right and the Lewis Powell Memo. And that campaign kicked into high gear during the Reagan Presidency.

But as that "pro business campaign" gained steam, the Democratic Party, IMO, realized that they could partake in the "riches" as well and sold their political soul for a piece of the action. Hartman's quote about the billionaire class should include their "wholly owned Republicans and Democrat politicians".

As Lambert mentions (paraphrasing), "The left puts the working class first. Both liberals and conservatives put markets first, liberals with many more layers of indirection (e.g., complex eligibility requirements, credentialing) because that creates niches from which their professional base benefits".

As an aside, while the pro-business/capitalism on steroids people have sought more "freedom", they have made the US and the world less free for the rest of us.

Also the over focusing on freedom is not uniquely GOP. As Hartman mentions, "the words freedom and liberty are iconic in American culture -- probably more so than with any other nation because they're so intrinsic to the literature, declarations and slogans of our nation's founding." US culture has taken the concept of freedom to an extreme version of individualism.

That is not surprising given our history.

The DRD4 gene is a dopamine receptor gene. One stretch of the gene is repeated a variable number of times, and the version with seven repeats (the "7R" form) produces a receptor protein that is relatively unresponsive to dopamine. Being unresponsive to dopamine means that people who have this gene have a host of related traits -- sensation and novelty seeking, risk taking, impulsivity, and, probably most consistently, ADHD. -- -- Seems like the type of people that would value extreme (i.e. non-collective) forms of freedom

The United States is the individualism poster child for at least two reasons. First there's immigration. Currently, 12 percent of Americans are immigrants, another 12 percent are children of immigrants, and everyone else except for the 0.9 percent pure Native Americans descend from people who emigrated within the last five hundred years.

And who were the immigrants?' Those in the settled world who were cranks, malcontents, restless, heretical, black sheep, hyperactive, hypomanic, misanthropic, itchy, unconventional, yearning to be free, yearning to be rich, yearning to be out of their, damn boring repressive little hamlet, yearning. -- -- Again seems like the type of people that would value freedom in all aspects of life and not be interested in collectivism

Couple that with the second reason -- for the majority of its colonial and independent history, America has had a moving frontier luring those whose extreme prickly optimism made merely booking passage to the New World insufficiently, novel -- and you've got America the individualistic.

The 7R variant mentioned above occurs in about 23 percent of Europeans and European Americans. And in East Asians? 1 percent. When East Asians domesticated rice and invented collectivist society, there was massive selection against the 7R variant. Regardless of the cause, East Asian cultural collectivism coevolved with selection against the 7R variant.

So which came first, 7R frequency or cultural style? The 4R and 7R variants, along with the 2R, occur worldwide, implying they already existed when humans radiated out of Africa 60,000 to 130,000 years ago. A high incidence of 7R, associated with impulsivity and novelty seeking, is the legacy of humans who made the greatest migrations in human history.

So it seems that many of the people who immigrated to the US were impulsive, novelty seeking, risk takers. As a counterpoint, many people that migrated to the US did not do so by choice but were forced from their homes and their countries by wars.

The point of this long comment is that for some people the concept of freedom can be taken to extreme -- a lack of gun control laws, financial regulation, extremes of wealth, etc. After a brief period in the 1940's, 1950's, and early 1960's when the US was more collective, we became greedy, consumerist, and consumption oriented, aided by the political and business elites as mentioned in the post.

If we want the US to be a more collective society we have to initially do so in our behaviors i.e. laws and regulations that rein in the people who would take the concept of freedom to an extreme. Then maybe over an evolutionary time period some of the move impulsive, sensation seeking, ADHDness, genes can be altered to a more balance mix of what makes the US great with more of the collective genes.

IMO, if we do not begin to work on becoming a collective culture now, then climate change, water scarcity, food scarcity, and resource scarcity will do it for us the hard way.

In these days of short attention spans I apologize for the long comment. The rest of my day is busy and I do not have more time to shorten the comment. I wanted to develop an argument for how the evolutionary and dysfunctional forms of freedom have gotten us to this point. And what we need to do to still have some freedom but also "play nice and share in the future sandbox of climate change and post fossil fuel society.

[Mar 19, 2019] Monopoly: too big to ignore

Mar 19, 2019 | crookedtimber.org

by John Quiggin on March 9, 2019

That's the headline given to my latest piece in Inside Story

Here's the opening para

Two hundred years after the birth of Karl Marx and fifty years after the last Western upsurge of revolutionary ferment in 1968, the term "monopoly capitalism" might seem like a relic of outmoded enthusiasms. But economists are increasingly coming to the view that monopolies, and associated market failures, have never been a bigger problem.

and the conclusion

The problems of monopoly and inequality may seem so large as to defy any response. But we faced similar problems when capitalism first emerged, and Western countries came up with the responses that created the broad-based prosperity of the mid twentieth century. The internet, in particular, has the potential to enhance freedom and equality rather than facilitate corporate exploitation. The missing ingredient, so far, has been the political will.

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hix 03.09.19 at 10:14 am ( 1 )

Good read, just one minor complaint, why not just use a random stock screener to get current market cap data instead of 2016 ones:
https://finance.yahoo.com/screener/unsaved/ca63a480-28d8-4809-bd40-fab28b414da2
Glen Tomkins 03.09.19 at 5:25 pm ( 2 )
"Monopoly" is such an ugly term. We prefer to call it "market power" these days, because of course it's a good thing if the job creators and their enterprises have more power to do all the good things they do for us. It's clearly class warfare, if not racism, to use the term of abuse, "monopoly", when you mean "market power".
Dipper 03.09.19 at 8:51 pm ( 3 )
Of all the examples to choose, airlines would seem to be a bad one. They come and go with rapidity, and airlines are now being used as an example of how to reform banks.

Running the modern air industry needs lots of infrastructure and lots of regulations, so would seem to be an obvious place to have monopoly airlines. The critical thing that has happened has been the splitting of the infrastructure from the market-facing entities. So the booking systems, airport handling, and other services are all done by firms who don't directly face the paying customer. Pretty much anyone can set up an airline, and they can become quite big

Banking regulation is going in the direction of the airline industry. The idea being to split up the major systems and financial risk repositories from the market-facing companies. Hence, again, anyone can set up a bank.

One significant issue behind the growth in monopolies is regulation. The debate in the UK over the EU has included much discussion of regulation, much of it from a Remain/pro EU angle being that more regulation is a costless good. But there is an obvious and well-known cost, that regulation acts as a barrier to new entrants, and hence destroys innovation and creates conditions for monopolies, cartels, and oligopolies. It is surely no coincidence that the EU, an organisation that cannot look at any object without trying to regulate it, is sliding into recession and has effectively zero productivity increase this century. If you regulate what you have now, you just make the status quo your future. In the end, you just end up like the CBI, reduced to demanding more and more cheap labour to fuel your dinosaur members' wishes for more profit.

So. Split the resource-heavy stuff from the market-facing stuff, and try to avoid regulating your economy into a coma.

Collin Street 03.09.19 at 9:11 pm ( 4 )
Sure, monopoly's a problem.

But.

A significant fraction of the population can't keep track of their actual cost structures and will, cheerful and unknowing, sell at a loss. Unless you can exclude them from the market -- unless you have some mechanism for excluding people from the market -- the clearing price will be below the cost price: no market that does not have exclusion mechanisms can possibly be profitable.

That is to say: a profitable sector of industry requires exclusion mechanisms and all profit relies on rent .

The question we have to ask is, then: how do we distribute rent opportunities? We used to be able to use transport costs to create rent "naturally", but we can't do that any more: at least with monopoly some things still get made and some people still make money.

[honestly? I think uniform tariff barriers coupled with socialism [or socialism-approximating structures like dirigisme among firms with effectively-universally-held shares] are the only real solution.]

bad Jim 03.10.19 at 7:24 am ( 5 )
Um. "Monopoly" triggers thoughts of a scotty dog and a flat iron. Regarding the minimum wage, I'm encouraged to see oligopsony mentioned, not just because I love rare words; it's only recently than in such discussions the more common word "monopsony" was used. But how else to explain how Walmart greeters and burger flippers, despite their disparate productivity and different employers, are paid the same meager wage?

It says something about our common discourse, by which I mean American politics, that people preach as though market power was as unimaginable as ethical conduct, the first of which is tacitly assumed and the second generally acknowledged as nonexistent.

John Quiggin 03.10.19 at 7:36 am ( 6 )
@Dipper I'm sure you'll sympathize when I observe that Australia is different from other places (a point you've often made about Britain), at least with respect to airlines.

We've only had one successful entry on a substantial scale in the history of commercial aviation (when Virgin Blue displaced Ansett in 2001). Against that, there has been a long string of failed attempts to break up the duopoly (now consisting of two full-service airlines each with a low-cost subsidiary).

So, in an Australian publication, airlines are on obvious example.

mpowell 03.11.19 at 3:52 pm ( 7 )
You argue that what has been missing is political will, but at the same time you acknowledge that new versions of the old solutions for these problems must be found. I would focus more on the latter than the former. Yes, the EU is creating stronger privacy protection now, but one of the main impacts will be to strengthen existing large players. Do we really want to move to a regulated monopoly model so quickly? These new markets have been evolving rapidly over the past 15 years and models of the internet economy that made sense even 10 years ago are now out-dated. I think we still need to figure out what people need out of these new provided services and how to get there. It seems a lot harder than simply breaking up the producers and distributers of basic commodities.
hix 03.11.19 at 6:01 pm ( 8 )
And here i was thinking Dipper would try to make his weak case with the strongest arguments- Ryanair or Easyjet*. Virgin Atlantic, really? While airlines in Europe are probably not the most obvious easy to comprehend example for monopoly or oligopoly one could pick, those terms are still quite accurate as a description of the current situation in most submarkets.

*The crux with those two is that there are and were a gazillion other discount carriers, but non of those are sucesfull, Ryanair in particular in contrast produces an insane return on equity.

Ronan 03.12.19 at 12:38 pm ( 9 )
Have you read 'Game of Mates' about cronyism among the elite in Australia ? Kind of interesting and eye opening(at least for an outsider like me) Might be of interest if you havent.

https://www.smh.com.au/opinion/game-of-mates-how-billionaires-get-rich-at-our-expense-20170526-gwe0dp.html

Daniel 03.12.19 at 8:58 pm ( 10 )
Speaking of monopoly, I read one (or more) of your contributors say, "buy my book on Amazon." Amazon is the most dangerous monopolist, stay away.

[Mar 17, 2019] Market Concentration Is Threatening the US Economy by Joseph E. Stiglitz

Notable quotes:
"... Making matters worse, America's low tax-to-GDP ratio – just 27.1% even before the Trump tax cut – means a dearth of money for investment in the infrastructure, education, health care, and basic research needed to ensure future growth. These are the supply-side measures that actually do "trickle down" to everyone. ..."
"... The policies for combating economically damaging power imbalances are straightforward. Over the past half-century, Chicago School economists , acting on the assumption that markets are generally competitive, narrowed the focus of competition policy solely to economic efficiency, rather than broader concerns about power and inequality. The irony is that this assumption became dominant in policymaking circles just when economists were beginning to reveal its flaws. The development of game theory and new models of imperfect and asymmetric information laid bare the profound limitations of the competition model. ..."
"... The law needs to catch up. Anti-competitive practices should be illegal, period. And beyond that, there are a host of other changes needed to modernize US antitrust legislation. Americans' need the same resolve in fighting for competition that their corporations have shown in fighting against it. ..."
Mar 17, 2019 | www.project-syndicate.org

Rising inequality and slow growth are widely recognized as key factors behind the spread of public discontent in advanced economies, particularly in the United States. But these problems are themselves symptoms of an underlying malady that the US political system may be unable to address.

The world's advanced economies are suffering from a number of deep-seated problems. In the United States, in particular, inequality is at its highest since 1928 , and GDP growth remains woefully tepid compared to the decades after World War II.

After promising annual growth of "4, 5, and even 6%," US President Donald Trump and his congressional Republican enablers have delivered only unprecedented deficits. According to the Congressional Budget Office's latest projections , the federal budget deficit will reach $900 billion this year, and will surpass the $1 trillion mark every year after 2021. And yet, the sugar high induced by the latest deficit increase is already fading, with the International Monetary Fund forecasting US growth of 2.5% in 2019 and 1.8% in 2020, down from 2.9% in 2018.

Many factors are contributing to the US economy's low-growth/high-inequality problem. Trump and the Republicans' poorly designed tax "reform" has exacerbated existing deficiencies in the tax code, funneling even more income to the highest earners. At the same time, globalization continues to be poorly managed, and financial markets continue to be geared toward extracting profits (rent-seeking, in economists' parlance), rather than providing useful services.

But an even deeper and more fundamental problem is the growing concentration of market power , which allows dominant firms to exploit their customers and squeeze their employees, whose own bargaining power and legal protections are being weakened . CEOs and senior executives are increasingly extracting higher pay for themselves at the expense of workers and investment.

For example, US corporate executives made sure that the vast majority of the benefits from the tax cut went into dividends and stock buybacks, which exceeded a record-breaking $1.1 trillion in 2018 . Buybacks raised share prices and boosted the earnings-per-share ratio, on which many executives' compensation is based. Meanwhile, at 13.7% of GDP , annual investment remained weak, while many corporate pensions went underfunded.

Evidence of rising market power can be found almost anywhere one looks. Large markups are contributing to high corporate profits . In sector after sector, from little things like cat food to big things like telecoms, cable providers, airlines, and technology platforms, a few firms now dominate 75-90% of the market, if not more; and the problem is even more pronounced at the level of local markets.

As corporate behemoths' market power has increased, so, too, has their ability to influence America's money-driven politics. And as the system has become more rigged in business's favor, it has become much harder for ordinary citizens to seek redress for mistreatment or abuse. A perfect example of this is the spread of arbitration clauses in labor contracts and user agreements, which allow corporations to settle disputes with employees and customers through a sympathetic mediator, rather than in court.

Multiple forces are driving the increase in market power. One is the growth of sectors with large network effects, where a single firm – like Google or Facebook – can easily dominate. Another is the prevailing attitude among business leaders, who have come to assume that market power is the only way to ensure durable profits. As the venture capitalist Peter Thiel famously put it , "competition is for losers."

Some US business leaders have shown real ingenuity in creating market barriers to prevent any kind of meaningful competition, aided by lax enforcement of existing competition laws and the failure to update those laws for the twenty-first-century economy. As a result, the share of new firms in the US is declining.

None of this bodes well for the US economy. Rising inequality implies falling aggregate demand, because those at the top of the wealth distribution tend to consume a smaller share of their income than those of more modest means.

Moreover, on the supply side, market power weakens incentives to invest and innovate. Firms know that if they produce more, they will have to lower their prices. This is why investment remains weak, despite corporate America's record profits and trillions of dollars of cash reserves. And besides, why bother producing anything of value when you can use your political power to extract more rents through market exploitation? Political investments in getting lower taxes yield far higher returns than real investments in plant and equipment. 1

Making matters worse, America's low tax-to-GDP ratio – just 27.1% even before the Trump tax cut – means a dearth of money for investment in the infrastructure, education, health care, and basic research needed to ensure future growth. These are the supply-side measures that actually do "trickle down" to everyone.

The policies for combating economically damaging power imbalances are straightforward. Over the past half-century, Chicago School economists , acting on the assumption that markets are generally competitive, narrowed the focus of competition policy solely to economic efficiency, rather than broader concerns about power and inequality. The irony is that this assumption became dominant in policymaking circles just when economists were beginning to reveal its flaws. The development of game theory and new models of imperfect and asymmetric information laid bare the profound limitations of the competition model.

The law needs to catch up. Anti-competitive practices should be illegal, period. And beyond that, there are a host of other changes needed to modernize US antitrust legislation. Americans' need the same resolve in fighting for competition that their corporations have shown in fighting against it.

The challenge, as always, is political. But with US corporations having amassed so much power, there is reason to doubt that the American political system is up to the task of reform. Add to that the globalization of corporate power and the orgy of deregulation and crony capitalism under Trump, and it is clear that Europe will have to take the lead.

[Mar 17, 2019] As Hemingway replied to Scott Fitzgerald assertion The rich are different than you and me : yes, they have more money.

Highly recommended!
Human society is way to complex for alpha males to succeed unconditionally... Quite a different set of traits is often needed.
Notable quotes:
"... Superficially, Hemingway was correct. But on a deeper level, he missed the reality of the heightened sense of entitlement that the very rich possess, as well as the deference that so many people automatically show to them. ..."
"... Hemingway is saying: take away all that money and the behavior would change as well. It's the money (or the power in your example) that makes the difference. ..."
"... I feel Fitzgerald got the basic idea right ..."
"... Apparently Fitzgerald was referring specifically to the attitudes of those who are born rich, attitudes that Fitzgerald thought remained unaltered by events, including the loss of economic status. ..."
"... "They think, deep in their hearts, that they are better than we are because we had to discover the compensations and refuges of life for ourselves. Even when they enter deep into our world or sink below us, they still think that they are better than we are. They are different." ..."
"... "He thought they were a special glamorous race and when he found they weren't it wrecked him as much as any other thing that wrecked him." ..."
Dec 31, 2015 | nakedcapitalism.com

Carolinian December 29, 2015

As Hemingway replied to that alum: "yes, they have more money."

Vatch December 29, 2015 at 11:25 am

Superficially, Hemingway was correct. But on a deeper level, he missed the reality of the heightened sense of entitlement that the very rich possess, as well as the deference that so many people automatically show to them. The rich shouldn't be different in this way, but they are. In some other societies, such entitlement and deference would accrue to senior party members, senior clergymen, or hereditary nobility (who might not have much money at all).

MyLessThanPrimeBeef December 29, 2015 at 11:45 am

"Go with the winner." That is how it works for the alpha male (a chimp, an ape, or a gorilla) for most followers anyway. Some will challenge. If victorious, followers will line up (more go-with-the-winner). If defeated, an outcast.

Carolinian December 29, 2015 at 12:04 pm

Without a doubt Hemingway had a rather catty attitude toward his literary rival, but in this instance I think the debunking is merited. It's quite possible that rich people act the way we would act if we were rich, and that Fitzgerald's tiresome obsession with rich people didn't cut very deep. Hemingway is saying: take away all that money and the behavior would change as well. It's the money (or the power in your example) that makes the difference.

Massinissa December 29, 2015 at 1:58 pm

In my opinion, the fact that if they had less money would change the way they think, does not change the fact that, while they have more money, they think differently, and different rules apply to them.

Massinissa December 29, 2015 at 2:00 pm

Addendum: The fact that an Alpha Chimp would act differently if someone else was the Alpha Chimp does not change the fact that an Alpha Chimp has fundamentally different behavior than the rest of the group.

Carolinian December 29, 2015 at 2:17 pm

Sounds like you are saying the behavior of the rich is different -- not what F. Scott Fitzgerald said.

Massinissa December 29, 2015 at 2:29 pm

https://en.wikiquote.org/wiki/Talk:F._Scott_Fitzgerald

"Hemingway is responsible for a famous misquotation of Fitzgerald's. According to Hemingway, a conversation between him and Fitzgerald went:

Fitzgerald: The rich are different than you and me.
Hemingway: Yes, they have more money.

This never actually happened; it is a retelling of an actual encounter between Hemingway and Mary Colum, which went as follows:

Hemingway: I am getting to know the rich.

Colum: I think you'll find the only difference between the rich and other people is that the rich have more money."

Just want to point out that that quote of Hemingways wasn't about Fitzgerald and wasn't even by Hemingway. Anyway I was more attacking the "rich have more money" thing than I was trying to defend Fitzgerald, but I feel Fitzgerald got the basic idea right

craazyman December 29, 2015 at 3:35 pm

I read somewhere, maybe a biography of one of them when I read books like that, that Hemingway actually said it and only said that F. Scott said it.

There are no heroes among famous men. I said that!

giantsquid December 29, 2015 at 4:00 pm

Here's an interesting take on this reputed exchange between Fitzgerald and Hemingway:

"The rich are different" The real story behind the famed "exchange" between F. Scott Fitzgerald and Ernest Hemingway.

http://www.quotecounterquote.com/2009/11/rich-are-different-famous-quote.html

Apparently Fitzgerald was referring specifically to the attitudes of those who are born rich, attitudes that Fitzgerald thought remained unaltered by events, including the loss of economic status.

"They think, deep in their hearts, that they are better than we are because we had to discover the compensations and refuges of life for ourselves. Even when they enter deep into our world or sink below us, they still think that they are better than we are. They are different."

Hemingway suggested that Fitzgerald had once been especially enamored of the rich, seeing them as a "special glamorous race" but ultimately became disillusioned.

"He thought they were a special glamorous race and when he found they weren't it wrecked him as much as any other thing that wrecked him."

[Mar 11, 2019] Is There Any Real Evidence of Elite Pedophile Sex Rings Involving Government Pop Culture – Collective Evolution

Mar 11, 2019 | www.collective-evolution.com

Pedophilia has come up in the mainstream a lot lately, as PizzaGate came to light fairly recently and more and more pedophile rings are being exposed, some of which have involved government officials.

If you're unfamiliar with PizzaGate, it refers to a wide range of email correspondence leaked from the DNC that allegedly unearthed a high-level elitist global pedophile ring in which the U.S. government was involved.

It emerged when Wikileaks released tens of thousands of emails from the former White House Chief of Staff under Bill Clinton, John Podesta, who also served as Hillary Clinton's campaign manager. It's because of these emails that many claimed John Podesta was a part of these child trafficking rings as well.

Since then, conspiracy theorists and world renowned journalists alike have been looking into the topic and speculating how big this problem could be and who could be involved within these underground rings.

For example, award winning American journalist Ben Swann explained the Pizzagate controversy in detail on mainstream news:

https://www.youtube.com/embed/-GZFHLAcG8A?start=0&modestbranding=1&showinfo=0&theme=light

Not long after, Swann's entire online personal brand and accounts had all but vanished from the internet. Why?

More recently, there's been some speculation that these pedophile rings could stretch into pop culture, potentially involving more pedophilia scandals and symbolism within the media. The question here is: Is there any tangible evidence of all of this, or is it mere speculation?

Pedophilia Symbolism

I'd like to begin by identifying the symbols that are used by pedophiles to identify themselves and make their requests within underground networks. Here is a link to a declassified FBI document illustrating the symbols and images used by pedophiles to "identify their sexual preferences."

So, how do these images relate to pizza? First of all, before PizzaGate was even suggested, "cheese pizza" was used as a code word to discuss "child porn" (hint: it's the same initials, CP). A quick Google search will reveal that the market for underage sex workers is fairly substantial, and you can even see a 2015 post on Urban Dictionary that explains how "cheese pizza" is used as code for child porn.

As per PizzaGate and the symbolism, it all started when multiple emails involving John Podesta, his brother, and Hillary Clinton simply didn't add up. Strange wording discussing pizza and cheese left readers confused, and because the emails made so little sense, it led many to suspect that they were code for something else.

For example, this email addressed to John Podesta reads: "The realtor found a handkerchief (I think it has a map that seems pizza-related)," and this email sent from John Podesta asks: "Do you think I'll do better playing dominos on cheese than on pasta?" There are many more examples, and I encourage you to go through the Wikileaks vault to explore.

On top of that, the DNC was associated with two pizza places, Comet Ping Pong and Besta Pizza, which use very clear symbols of pedophilia in their advertising and have strange images of children and other ritualistic type images and suspicious videos on their social media accounts – which has since been made private given the controversy over the images and their link to the DNC, but again, a quick Google search will show you what those images looked like. You can read the email correspondence between John Podesta and Comet Ping Pong's owner, James Alefantis, here .

... ... ...

[Jan 11, 2019] As Democratic Elites Reunite With Neocons, The Party's Voters Are Becoming Far More Militaristic And Pro-War Than Republicans by Glenn Greenwald

Clinton Democrats (DemoRats) are so close to neocons that the current re-alliance is only natural and only partially caused by Trump. Under Obama some of leading figures of his administration were undistinguishable from neocons (Samantha Power is a good example here -- she was as crazy as Niki Haley, if not more). There is only one "war party in the USA which continently consists of two wings: Repugs and DemoRats.
Notable quotes:
"... Both GOP Sen. Lindsey Graham , one of the country's most reliable war supporters, and Hillary Clinton , who repeatedly criticized former President Barack Obama for insufficient hawkishness, condemned Trump's decision in very similar terms, invoking standard war on terror jargon. ..."
"... That's not surprising given that Americans by a similarly large plurality agree with the proposition that "the U.S. has been engaged in too many military conflicts in places such as Syria, Iraq, and Afghanistan for too long and should prioritize getting Americans out of harm's way" ..."
"... But what is remarkable about the new polling data on Syria is that the vast bulk of support for keeping troops there comes from Democratic Party voters, while Republicans and independents overwhelming favor their removal. The numbers are stark: Of people who voted for Clinton in 2016, only 26 percent support withdrawing troops from Syria, while 59 percent oppose it. Trump voters overwhelmingly support withdraw by 76 percent to 14 percent. ..."
"... This case is even more stark since Obama ran in 2008 on a pledge to end the war in Afghanistan and bring all troops home. Throughout the Obama years, polling data consistently showed that huge majorities of Democrats favored a withdrawal of all troops from Afghanistan ..."
"... While Democrats were more or less evenly divided early last year on whether the U.S. should continue to intervene in Syria, all that changed once Trump announced his intention to withdraw, which provoked a huge surge in Democratic support for remaining ..."
"... At the same time, Democratic policy elites in Washington are once again formally aligning with neoconservatives , even to the point of creating joint foreign policy advocacy groups (a reunion that predated Trump ). The leading Democratic Party think tank, the Center for American Progress, donated $200,000 to the neoconservative American Enterprise Institute and has multilevel alliances with warmongering institutions. ..."
"... By far the most influential [neo]liberal media outlet, MSNBC, is stuffed full of former Bush-Cheney officials, security state operatives, and agents , while even the liberal stars are notably hawkish (a decade ago, long before she went as far down the pro-war and Cold Warrior rabbit hole that she now occupies, Rachel Maddow heralded herself as a "national security liberal" who was "all about counterterrorism"). ..."
"... All of this has resulted in a new generation of Democrats, politically engaged for the first time as a result of fears over Trump, being inculcated with values of militarism and imperialism, trained to view once-discredited, war-loving neocons such as Bill Kristol, Max Boot, and David Frum, and former CIA and FBI leaders as noble experts and trusted voices of conscience. It's inevitable that all of these trends would produce a party that is increasingly pro-war and militaristic, and polling data now leaves little doubt that this transformation -- which will endure long after Trump is gone -- is well under way. ..."
Jan 11, 2019 | www.zerohedge.com

Via Glenn Greenwald of The Intercept

PRESIDENT DONALD TRUMP'S December 18 announcement that he intends to withdraw all U.S. troops from Syria produced some isolated support in the anti-war wings of both parties , but largely provoked bipartisan outrage among in Washington's reflexively pro-war establishment.

Both GOP Sen. Lindsey Graham, one of the country's most reliable war supporters, and Hillary Clinton, who repeatedly criticized former President Barack Obama for insufficient hawkishness, condemned Trump's decision in very similar terms, invoking standard war on terror jargon.

But while official Washington united in opposition, new polling data from Morning Consult/Politico shows that a large plurality of Americans support Trump's Syria withdrawal announcement: 49 percent support to 33 percent opposition.

That's not surprising given that Americans by a similarly large plurality agree with the proposition that "the U.S. has been engaged in too many military conflicts in places such as Syria, Iraq, and Afghanistan for too long and should prioritize getting Americans out of harm's way" far more than they agree with the pro-war view that "the U.S. needs to keep troops in places such as Syria, Iraq, and Afghanistan to help support our allies fight terrorism and maintain our foreign policy interests in the region."

But what is remarkable about the new polling data on Syria is that the vast bulk of support for keeping troops there comes from Democratic Party voters, while Republicans and independents overwhelming favor their removal. The numbers are stark: Of people who voted for Clinton in 2016, only 26 percent support withdrawing troops from Syria, while 59 percent oppose it. Trump voters overwhelmingly support withdraw by 76 percent to 14 percent.

A similar gap is seen among those who voted Democrat in the 2018 midterm elections (28 percent support withdrawal while 54 percent oppose it), as opposed to the widespread support for withdrawal among 2018 GOP voters: 74 percent to 18 percent.

Identical trends can be seen on the question of Trump's announced intention to withdraw half of the U.S. troops currently in Afghanistan, where Democrats are far more supportive of keeping troops there than Republicans and independents.

This case is even more stark since Obama ran in 2008 on a pledge to end the war in Afghanistan and bring all troops home. Throughout the Obama years, polling data consistently showed that huge majorities of Democrats favored a withdrawal of all troops from Afghanistan:

With Trump rather than Obama now advocating troop withdrawal from Afghanistan, all of this has changed. The new polling data shows far more support for troop withdrawal among Republicans and independents, while Democrats are now split or even opposed . Among 2016 Trump voters, there is massive support for withdrawal: 81 percent to 11 percent; Clinton voters, however, oppose the removal of troops from Afghanistan by a margin of 37 percent in favor and 47 percent opposed.

This latest poll is far from aberrational. As the Huffington Post's Ariel Edwards-Levy documented early this week , separate polling shows a similar reversal by Democrats on questions of war and militarism in the Trump era.

While Democrats were more or less evenly divided early last year on whether the U.S. should continue to intervene in Syria, all that changed once Trump announced his intention to withdraw, which provoked a huge surge in Democratic support for remaining. "Those who voted for Democrat Clinton now said by a 42-point margin that the U.S. had a responsibility to do something about the fighting in Syria involving ISIS," Edwards-Levy wrote, "while Trump voters said by a 16-point margin that the nation had no such responsibility." (Similar trends can be seen among GOP voters, whose support for intervention in Syria has steadily declined as Trump has moved away from his posture of the last two years -- escalating bombings in both Syria and Iraq and killing far more civilians , as he repeatedly vowed to do during the campaign -- to his return to his other campaign pledge to remove troops from the region.)

This is, of course, not the first time that Democratic voters have wildly shifted their "beliefs" based on the party affiliation of the person occupying the Oval Office. The party's base spent the Bush-Cheney years denouncing war on terror policies, such as assassinations, drones, and Guantánamo as moral atrocities and war crimes, only to suddenly support those policies once they became hallmarks of the Obama presidency .

But what's happening here is far more insidious. A core ethos of the anti-Trump #Resistance has become militarism, jingoism, and neoconservatism. Trump is frequently attacked by Democrats using longstanding Cold War scripts wielded for decades against them by the far right: Trump is insufficiently belligerent with U.S. enemies; he's willing to allow the Bad Countries to take over by bringing home U.S. soldiers; his efforts to establish less hostile relations with adversary countries is indicative of weakness or even treason.

At the same time, Democratic policy elites in Washington are once again formally aligning with neoconservatives , even to the point of creating joint foreign policy advocacy groups (a reunion that predated Trump ). The leading Democratic Party think tank, the Center for American Progress, donated $200,000 to the neoconservative American Enterprise Institute and has multilevel alliances with warmongering institutions.

By far the most influential [neo]liberal media outlet, MSNBC, is stuffed full of former Bush-Cheney officials, security state operatives, and agents , while even the liberal stars are notably hawkish (a decade ago, long before she went as far down the pro-war and Cold Warrior rabbit hole that she now occupies, Rachel Maddow heralded herself as a "national security liberal" who was "all about counterterrorism").

All of this has resulted in a new generation of Democrats, politically engaged for the first time as a result of fears over Trump, being inculcated with values of militarism and imperialism, trained to view once-discredited, war-loving neocons such as Bill Kristol, Max Boot, and David Frum, and former CIA and FBI leaders as noble experts and trusted voices of conscience. It's inevitable that all of these trends would produce a party that is increasingly pro-war and militaristic, and polling data now leaves little doubt that this transformation -- which will endure long after Trump is gone -- is well under way.

[Jan 05, 2019] Obama as the agent of the Deep State consciously deciving his voters with faux populism promises which he never intended to follow

Obama strategy in Syria was replica of Clinton strategy in Yugoslavia during the Balkan Wars. Divide everybody up by ethnicity or religion (Croats are Catholics, Serbians are Orthodox not to mention the various Muslims and Albanians lurking about), arm them, create false flags to set them at each other's throats. Enjoy the results.
Obama like Clinton before him was a real wolve in sheep's clothing
Notable quotes:
"... Jackrabbit, I agree with Bevin. Obama was really useful to the deep state because, as the "First Black President" he was widely popular, not just inside the US but outside it as well. Before the 2016 election, there was a widespread hope inside the US elite that Hillary Clinton, as the "First Woman President" would be able to serve a similar function in giving US imperialism a pleasing face. ..."
"... Trump, by contrast, hurts the US deep state because his true nature as a greedy, incompetent egotist is just too blatantly obvious to too many people. And he won't follow a script, the way GW Bush usually did. That's why we see major sections of the US deep state going out of their way to be publically hostile towards Trump. ..."
Jan 05, 2019 | www.moonofalabama.org

Jackrabbit , Jan 5, 2019 6:10:33 PM | 17

bevin @10:

But the notion that it is part of a complex and tightly scripted conspiracy in which he plays his public part and the deep state play theirs, pretending to be at odds with each other, is bizarre.
I would've agreed with you before Obama. I followed the criticisms of Obama from true progressives closely. It was clear within 2 or 3 years that Obama was betraying his 'base'.

His lofty rhetoric didn't match his actions. His Nobel Peace Prize can only be viewed today as a ruse. He talked of peace and fairness but worked behind the scenes to further the establishment.

Fast forward to the 2016 election where Sanders was a sheepdog and Hillary ran a terrible campaign. It's difficult to look back and not be at least somewhat suspicious of the 2016 election. A populist nationalist was what the Deep State NEEDED to face the threat from Russia and China to their NWO project. And that is what they got. After recognizing the threat in 2013-14 (when Russia countered the Empire in Syria and Ukraine).

Similar excuses are made for both Obama and Trump. We are told that they were FORCED to succumb to Deep State scheming and political power. But a much more logical view is that these "populists" know exactly what they are doing: they know what their 'job' is to serve the establishment and act as the leader of the Deep State's political arm. In return they get financial gain, social standing, and life long protection. Sweet.

Obama 'turned the page' on the Bush Administration's warmongering. He promised a more peaceful USA. But he conducted covert wars and bragged of his drone targeting.

Trump 'turned the page' on Obama's deceitfulness. He promised to put 'America First' but within months attacked Syria with missiles "for the babies". Evidence that his first attack was prompted by a false flag didn't deter him from attacking AGAIN - also based on a false flag. Trump is still helping the Saudis in Yemen. And he's not doing what's necessary to get peace in Korea.

Obama promised 'transparency' ("Sunlight is the best disinfectant") but 'no drama' Obama protected CIA torturers, NSA spies, and bankers. Trump promised to "drain the swamp" but has welcomed oligarchs and neocons into his Administration.

How much sly BS do we have to see before people connect the dots? A real populist will NEVER be elected in USA unless there is a revolution; USA political elites are fully committed to a neoliberal economics that make society neofeudal, and a neoconservative-driven foreign policy that demands full spectrum dominance that brooks no opposition to its NWO goals.

Anyone who believes otherwise has drunk the Kool-Aid, an addictive, saccharine concoction, provided without charge and in abundance.

Glenn Brown | Jan 5, 2019 10:27:14 PM |

39@ 10 17

Jackrabbit, I agree with Bevin. Obama was really useful to the deep state because, as the "First Black President" he was widely popular, not just inside the US but outside it as well. Before the 2016 election, there was a widespread hope inside the US elite that Hillary Clinton, as the "First Woman President" would be able to serve a similar function in giving US imperialism a pleasing face.

Trump, by contrast, hurts the US deep state because his true nature as a greedy, incompetent egotist is just too blatantly obvious to too many people. And he won't follow a script, the way GW Bush usually did. That's why we see major sections of the US deep state going out of their way to be publically hostile towards Trump.

Yes, their public rejection of Trump is partly motivated by the need to be able to claim that Trump is an aberration from all previous US Presidents, as opposed to Trump and his policies being just a particularly explicit continuation of the same underlying trends.

But I see no reason to doubt that the US elites really wish they had someone as President who was better at supplying the right propaganda and less obviously an incompetent fool. So I don't understand why you think the US oligarchy and deep state would have thought they needed someone like Trump, or would have greatly preferred him to Hillary Clinton.

[Dec 08, 2018] In office, both Bill Clinton and Barack Obama rarely fought for progressive principles -- and routinely undermined them."

Dec 08, 2018 | www.moonofalabama.org

ben , Dec 5, 2018 4:54:14 PM | link

"The last two Democratic presidencies largely involved talking progressive while serving Wall Street and the military-industrial complex. The obvious differences in personalities and behavior of Bill Clinton and Barack Obama diverted attention from their underlying political similarities. In office, both men rarely fought for progressive principles -- and routinely undermined them."

Article from Truthdig: https://www.truthdig.com/articles/what-it-means-that-hillary-clinton-might-run-for-president-in-2020/

[Nov 27, 2018] The political fraud of Alexandria Ocasio-Cortez's "Green New Deal"

Highly recommended!
After Democratic party was co-opted by neoliberals there is no way back. And since Obama the trend of Democratic Party is toward strengthening the wing of CIA-democratic notthe wing of the party friendly to workers. Bought by Wall Street leadership is uncable of intruting any change that undermine thier current neoliberal platform. that's why they criminally derailed Sanders.
Notable quotes:
"... When you think about the issue of how exactly a clean-energy jobs program would address the elephant in the room of private accumulation and how such a program, under capitalism, would be able to pay living wages to the people put to work under it, it exposes how non threatening these Green New Deals actually are to capitalism. ..."
"... To quote Trotsky, "These people are capable of and ready for anything!" ..."
"... "Any serious measures to stop global warming, let alone assure a job and livable wage to everyone, would require a massive redistribution of wealth and the reallocation of trillions currently spent on US imperialism's neo-colonial wars abroad." ..."
"... "It includes various left-sounding rhetoric, but is entirely directed to and dependent upon the Democratic Party." ..."
"... "And again and again, in the name of "practicality," the most unrealistic and impractical policy is promoted -- supporting a party that represents the class that is oppressing and exploiting you! The result is precisely the disastrous situation working people and youth face today -- falling wages, no job security, growing repression and the mounting threat of world war." - New York Times tries to shame "disillusioned young voters" into supporting the Democrats ..."
"... It is an illusion that technical innovation within the capitalist system will magically fundamentally resolve the material problems produced by capitalism. But the inconvenient facts are entirely ignored by the corporate shills in the DSA and the whole lot of establishment politicians, who prefer to indulge their addiction to wealth and power with delusions of grandeur, technological utopianism, and other figments that serve the needs of their class. ..."
"... First it was Obama with his phoney "hope and change" that lured young voters to the Dumbicrats and now it's Ocacia Cortez promising a "green deal" in order to herd them back into the Democratic party--a total fraud of course--totally obvious! ..."
"... from Greenwald: The Democratic Party's deceitful game https://www.salon.com/2010/... ..."
Nov 27, 2018 | www.wsws.org

Raymond Colison4 days ago

they literally ripped this out of the 2016 Green Party platform. Jill Stein spoke repeatedly about the same exact kind of Green New Deal, a full-employment, transition-to-100%-renewables program that would supposedly solve all the world's problems.

When you think about the issue of how exactly a clean-energy jobs program would address the elephant in the room of private accumulation and how such a program, under capitalism, would be able to pay living wages to the people put to work under it, it exposes how non threatening these Green New Deals actually are to capitalism.

In 2016, when the Greens made this their central economic policy proposal, the Democrats responded by calling that platform irresponsible and dangerous ("even if it's a good idea, you can't actually vote for a non-two-party candidate!"). Why would they suddenly find a green new deal appealing now except for its true purpose: left cover for the very system destroying the planet.

To quote Trotsky, "These people are capable of and ready for anything!"

Greg4 days ago
"Any serious measures to stop global warming, let alone assure a job and livable wage to everyone, would require a massive redistribution of wealth and the reallocation of trillions currently spent on US imperialism's neo-colonial wars abroad."

Their political position not only lacks seriousness, unserious is their political position.

"It includes various left-sounding rhetoric, but is entirely directed to and dependent upon the Democratic Party."

For subjective-idealists, what you want to believe, think and feel is just so much more convincing than objective reality. Especially when it covers over single-minded class interests at play.

"And again and again, in the name of "practicality," the most unrealistic and impractical policy is promoted -- supporting a party that represents the class that is oppressing and exploiting you! The result is precisely the disastrous situation working people and youth face today -- falling wages, no job security, growing repression and the mounting threat of world war." - New York Times tries to shame "disillusioned young voters" into supporting the Democrats

Penny Smith4 days ago
It is an illusion that technical innovation within the capitalist system will magically fundamentally resolve the material problems produced by capitalism. But the inconvenient facts are entirely ignored by the corporate shills in the DSA and the whole lot of establishment politicians, who prefer to indulge their addiction to wealth and power with delusions of grandeur, technological utopianism, and other figments that serve the needs of their class.
Jim Bergren4 days ago
First it was Obama with his phoney "hope and change" that lured young voters to the Dumbicrats and now it's Ocacia Cortez promising a "green deal" in order to herd them back into the Democratic party--a total fraud of course--totally obvious!

Only an International Socialist program led by Workers can truly lead a "green revolution" by expropriating the billionaire oil barons of their capital and redirecting that wealth into the socialist reconstruction of the entire economy.

Master Oroko4 days ago
Alexandria Ocasio-Cortez's "Green New Deal" is a nice laugh. Really, it sure is funny hearing these lies given any credence at all. This showmanship belongs in a fantasy book, not in real life. The Democratic Party as a force for good social change Now that's a laugh!
Vivek Jain4 days ago
from Greenwald: The Democratic Party's deceitful game https://www.salon.com/2010/...
лидия5 days ago
"Greenwashing" of capitalism (and also of Zionist apartheid colony in Palestine) is but one of dirty tricks by Dems and their "left" backers.
Kalen5 days ago
Lies, empty promises, meaningless tautologies and morality plays, qualified and conditional declarations to be backpedalled pending appropriate political expediencies, devoid any practical content that is what AOC, card carrying member of DSA, and in fact young energetic political apparatchik of calcified political body of Dems establishment, duty engulfs. And working for socialist revolution is no one of them.

What kind of socialist would reject socialist revolution, class struggle and class emancipation and choose, as a suppose socialist path, accommodation with oligarchic ruling elite via political, not revolutionary process that would have necessarily overthrown ruling elite.

What socialist would acquiesce to legalized exploitation of people for profit, legalized greed and inequality and would negotiate away fundamental principle of egalitarianism and working people self rule?

Only National Socialist would; and that is exactly what AOC campaign turned out to be all about.

National Socialism with imperial flavor is her affiliation and what her praises for Pelosi, wife of a billionaire and dead warmonger McCain proved.

Now she is peddling magical thinking about global change and plunge herself into falacy of entrepreneurship, Market solution to the very problem that the market solutions were designed to create and aggravate namely horrific inequality that is robbing people from their own opportunities to mitigate devastating effects of global change.

The insidiousness of phony socialists expresses itself in the fact that they lie that any social problem can be fixed by current of future technical means, namely via so called technological revolution instead by socialist revolution they deem unnecessary or detrimental.

Me at home Kalen4 days ago
The technical means for achieving socialism has existed since the late 19th century, with the telegraph, the coal-powered factory, and modern fertilizer. The improvements since then have only made socialism even more streamlined and efficient, if such technologies could only be liberated from capital! The idea that "we need a new technological revolution just to achieve socialism" reflects the indoctrination in capitalism by many "socialist" theorists because it is only in capitalism where "technological growth" is essential simply to maintain the system. It is only in capitalism (especially America, the most advanced capitalist nation, and thus, the one where capitalism is actually closest towards total crisis) where the dogma of a technological savior is most entrenched because America cannot offer any other kind of palliative to the more literate and productive sections of its population. Religion will not convince most and any attempt at a sociological or economic understanding would inevitably prove the truth of socialism.

[Nov 23, 2018] Sitting on corruption hill

Highly recommended!
Mueller is in the cave just below the Clinton foundation" sign. Entrance is behind the bag with the dollars ;-)
Nov 23, 2018 | www.zerohedge.com

[Nov 06, 2018] 'Somebody' made fradulent promises and put people in danger to acheive some political goal. Sounds like Clintons or Soros.

Notable quotes:
"... "a group called CARA Family Detention Pro Bono Project" a group that has received funding from Soros, to Pueblo Sin Fronteras through a person named 'Alex Mensing' who works both for CARA and as "an on-the ground coordinator in Mexico for the Pueblo Sin Fronteras". ..."
"... ..A vital part of that expansion has involved money: major donations from some of the nation's wealthiest liberal foundations, including the Ford Foundation, the Carnegie Corporation of New York, the Open Society Foundations of the financier George Soros, and the Atlantic Philanthropies. Over the past decade those donors have invested more than $300 million in immigrant organizations, including many fighting for a pathway to citizenship for immigrants here illegally.... ..."
"... US based groups or cutouts are the organizers of the caravan. ..."
"... The list of Democratic Party-connected organizations that might have originated the idea of a caravan from Central America is small. I surmise Clinton Global Initiative because they would have the requisite connections and blaming Soros seems to easy and convenient. But Soros is also rumored to be behind support for European migrants so it's certainly possible. ..."
Nov 06, 2018 | www.moonofalabama.org

Peter AU 1 , Nov 5, 2018 2:28:56 PM | link

How did this group of thousands come together to walk to US were Trump has vowed to keep illegals out. People like this would naturally come together if they were catching a ship, or at some sort of aid post refugee camp ect.

After a search on caravan starting point, I found this at the Guardian.

"Who organized the caravan?
In interviews, Honduran members of the group said that they learned about the caravan from Facebook posts, and a report on the local HCH television station, which erroneously suggested that a former congressman and radio host would cover the costs of the journey.
After that, rumours spread quickly, including the mistaken promise that any member would be given asylum in the US. Darwin Ramos, 30, said he was desperate to flee threats from a local drug gang, and when news of the caravan reached his neighbourhood, he seized on it as his best chance to escape."
https://www.theguardian.com/us-news/2018/oct/24/caravan-migrants-what-is-it-where-from-guatemala-honduras-immigrants-mexico


Uh huh. 'Somebody' made mistaken promises.

Peter AU 1 , Nov 5, 2018 4:06:27 PM | link

https://en.wikipedia.org/wiki/Pueblo_Sin_Fronteras
"Pueblo Sin Fronteras (en: People without Borders) is an immigration rights group known for organizing several high profile migrant caravans in Mexico and Central America. The organization's efforts to facilitate immigration and calls for open borders attracted considerable amounts of coverage in the Mexican and American media."

Pueblo Sin Fronteras website. Zero information there other than the have bases or offices in San Diego, Los Angeles, San Francisco and Tijuana in Mexico.
https://www.pueblosinfronteras.org/commitees.html
No information on who they are or who funds them. Very much a political organization.
On two caravans like this have occurred, both organized by this shadowy group.
Slow moving lots of press coverage that can last for weeks so long as the peasant suckers stay suckers and don't pull out. Very much an anti Trump political show put on by whoever funds and controls this Pueblo Sin Fronteras organisation.

Peter AU 1 , Nov 5, 2018 4:34:48 PM | link
Centro Sin Fronteras is the parent group to Pueblo Sin Fronteras.
https://www.influencewatch.org/non-profit/centro-sin-fronteras/
"Elvira Arellano, an illegal immigrant from Mexico, former fugitive from U.S. immigration authorities, and activist for illegal immigrants in the U.S., formed the activist group La Familia Latina Unida ("The United Latin Family") as an expansion of the Centro Sin Fronteras. [7] La Familia Latina Unida runs Pueblo Sin Fronteras ("People Without Borders"), a group that organizes "migrant caravans" from Mexico and Latin America to cross the U.S. border illegally"

CSF website here https://fluenglish.wordpress.com/about/
Again nothing on who finances them.

Peter AU 1 , Nov 5, 2018 4:41:49 PM | link
The majority of people in the caravan may be leaving their own countries due to violence poverty ect, but the caravan itself is a manufactured political event. left to their own devices, some may have moved towards the US in small groups, others would have been deterred due to Trumps immigration policy, but they have joined this so called caravan on false promises made by the organisers. Nothing better than kids, women and oldies doing it tough or better yet dying for political media coverage.
dh-mtl , Nov 5, 2018 5:26:11 PM | link
Peter AU 1 | Nov 5, 2018 4:34:48 PM | 73 says:

"Again nothing on who finances them. (Pueblo Sin Fronteras)"


This article, published the last time that Pueblo Sin Fronteras was in the headlines, ( https://joeforamerica.com/2018/04/whos-really-behind-the-illegal-immigrants-the-migrant-caravan-and-pueblo-sin-fronteras/) links "a group called CARA Family Detention Pro Bono Project" a group that has received funding from Soros, to Pueblo Sin Fronteras through a person named 'Alex Mensing' who works both for CARA and as "an on-the ground coordinator in Mexico for the Pueblo Sin Fronteras".

Peter AU 1 , Nov 5, 2018 5:41:08 PM | link
Sleepy "If they request asylum, their entry is legal"

If they get into the US, immediately present themselves to authorities and request asylum, then their entry is deemed legal. https://en.wikipedia.org/wiki/Convention_Relating_to_the_Status_of_Refugees
US has signed up to the 1967 protocol but not the 1951 convention.

As for the politically organized caravan, the peasants have officially been offered a home in Mexico, but the organizers prefer them to go on to the US. As they have been offered a place in mexico, they are now economic migrants wanting greener pastures in the US rather than refugees.

The peasants themselves, I think are mostly genuine though organizers are mixed through the group. The peasants are no more than consumables in a political action.

Peter AU 1 , Nov 5, 2018 6:16:23 PM | link
The money.

. ..A vital part of that expansion has involved money: major donations from some of the nation's wealthiest liberal foundations, including the Ford Foundation, the Carnegie Corporation of New York, the Open Society Foundations of the financier George Soros, and the Atlantic Philanthropies. Over the past decade those donors have invested more than $300 million in immigrant organizations, including many fighting for a pathway to citizenship for immigrants here illegally....
https://www.nytimes.com/2014/11/15/us/obama-immigration-policy-changes.html

Pft , Nov 5, 2018 6:36:34 PM | link
How can people not see this caravan march as the obvious false flag it is to influence the election. The actors are being paid and busses have been mobilized and paid for to move them forward. The right says Soros money might be behind it and they may be right. Surprised the left has not blamed Putin. Which proves my point that the left is actively conspiring with the right the keep them in power. Why wouldnt they care?. As Caitlin Johnstone says, after I said it, they get paid the same no matter what. As part of a 2 party monopoly,with 2 parties the minimum to serve the illusion of a representative Democracy,the oiligarchs will continue to throw money to the loser.

This has been scripted well in advance. Republicans need to maintain both houses for the 2nd stage of Trumps destruction of America (credibility and finance), especially its government and middle class as the elite will be protected from the damage. Democrats are standing on the sidelines rambling about Russia Gate or Khashoggi Gate or mobilizing their forces to support gay marriages and transgender access to bathrooms. And to boot they bring out Hillary and Obama at the last moment to bash Trump to galvanize the rights voters even more. No other purpose for doing so.

To be sure, a Democratic win means nothing except perhaps as a poor proxy for a lack of support for Trump. 40% of their candidates come from the military or intelligence services. They are owned by the oligarchs as much as tbe Republicans. The only difference in the parties is the costumes they wear and the rhetoric the speak

Or perhaps its as simple as not wanting to share responsibility for what is to come as their best shot to win in 2020

Frankly the best outcome would be the decimation of the Democrat Party and its subsequent dissolution. Lets end the farce of a Democracy. One party for all. Hail Trump or whomever he appoints as his successor, or just let the elites vote and announce who they voted for every 4 years. Thats pretty much what the constitution meant for us to be doing anyways. The idea of a Direct vote by all citizens for President and Senate would have horrified them. Seeing the results of elections these past 40 years I have concluded they are right.


Jackrabbit , Nov 5, 2018 6:42:21 PM | link
b, RJPJR, Jay, Yeah Right, et al

Invaders or Dupes? Have the caravan migrants been misled?

While it's true that anyone can request asylum, the caravan migrants appear to be under the impression that they have a legitimate claim to asylum in USA because they are fleeing gang violence in their home country. That is very likely to be untrue.

Such a claim MIGHT be valid in countries that have signed the Cartagena Declaration and ratified it into law - but the US has not. The Declaration expands the definition of refugees to include:

"persons who have fled their country because their lives, security or freedom have been threatened by generalized violence, foreign aggression, internal conflicts, massive violation of human rights or other circumstances which have seriously disturbed public order".

The Brazil Declaration is an effort to expand the Cartegena Declaration . The USA is also not involved in this effort either, though I believe that they have "observer" status.

FYI
The 1951 UN Convention as amended defines a refugee as someone with a "well-founded fear of being persecuted for reasons of race, religion, nationality, membership of a particular social group or political opinion" . The caravan stories I have heard are unlikely to qualify under this definition.

Some countries that have loads of asylum seekers have set up camps to hold them. Some, like Australia, even have camps in foreign countries. Trump's talk of setting up tents implies that USA will also establish such camps. Life in these camps is likely to be uncomfortable and unproductive. Only those will genuine asylum claims would tough it out.

Grieved , Nov 5, 2018 7:40:05 PM | link
How telling it is that when we disagree on the nature of the Caravan, we fall into an either-or choice between 2 absolutes. Either it is a complete hoax from the ground up, or it's a completely authentic grass-roots happening.

But we have seen enough color revolutions to understand that there is always an authentic component to each one. I have commented several times on how delicately the CIA and other organizers of color revolutions symbiotically fuse with good and authentic people who have a noble cause. How these bad people can merge with such good people is a wonder to me.

But this itself is the fact that must demolish the partisan thinking of "one side or the other". It's clear that the people who run things and their henchmen who arrange things are marvelously nuanced when it comes to good and evil. They'll be good when it suits them and evil for the same reason, and treat people well and badly, all depending on the exigencies of the mission.

In simple words, there undoubtedly is a core heart to the population of the caravan that is good, hopeful, enterprising and industrious, and that hopes to receive just one little break from the world, and a sliver of social justice. This radiating core of goodness and humanity, which would break open the hearts of ordinary people like you and me, to the organizers and their fixers is simply the perfect place to hide, concealed by superb protective coloration.

Take a look at the Maidan in Ukraine, and see how many good people thought they were fighting to create a wonderful new world, until the snipers fired on both sides and brought off the color revolution with superb skill and complete amoral ruthlessness - all as a result of long planning and preparation, not to mention the cash to hire mercenaries and provide the best logistics.

So I personally will stand by my thought that we will see what this is when the shooters begin to provoke the violence. And if that happens, then sadly, it will be the innocents who again, as always, are massacred.

But if the US handles it well, and permits controlled entry under the supervision of the border authorities, and there are no shooters and no provocations coming either from the Caravan people - or from some other force off to the side that doesn't seem to belong to anyone, but which seems to be the cause of death to both sides - then this will all fizzle out as another political skirmish of short duration, and the Democrats and Republicans will move on to their next diversions.

RJPJR , Nov 5, 2018 7:47:23 PM | link
Posted by: Grieved | Nov 5, 2018 7:40:05 PM | 97

You wrote: "Either it is a complete hoax from the ground up, or it's a completely authentic grass-roots happening."

I am inclined to believe that it is both, to wit an authentic grass-roots happening that has been hijacked (like so many others) by interested parties for their own ends.

Posted by: karlof1 | Nov 5, 2018 6:59:25 PM | 95

Thanks for the link!

Peter AU 1 , Nov 5, 2018 7:53:13 PM | link
Grieved 97
That's the way I'm seeing it. "But we have seen enough color revolutions to understand that there is always an authentic component to each one. I have commented several times on how delicately the CIA and other organizers of color revolutions symbiotically fuse with good and authentic people who have a noble cause. How these bad people can merge with such good people is a wonder to me."

Well put, not only the above paragragh but the whole comment. Not much most of us can do to help the naive perhaps desperate people sucked in to the US political caravan but we should at least be exposing those who are exploiting and furthingf their misery for political purposes.

Jackrabbit , Nov 5, 2018 8:27:50 PM | link
RJPJR:
I am inclined to believe that it is both, to wit an authentic grass-roots happening that has been hijacked ...

I think it is fake as per info @93.

The caravan people are real and hopeful of a better life but they have been duped into believing that they could get asylum.

Pft , Nov 5, 2018 8:40:05 PM | link
Nemesiscalling@94

Requirement for any President or political leader is to be a good actor. I believe they simply follow a script prepared by the real rulers operating in the shadows. Maybe I am wrong. Its like fake wrestling as Caitlin Johnstone pointed out. You have to be a good actor and pretend to care while actually making sure you qlose if the script calls for it

Jackrabbit@100

Its true they have been duped but the point is that desparate and poor people rarely work together spontaneously in an organized fashion and a caravan such as this must be organized and paid for. Someone is feeding them. The timing is too good to be true. Obviously they have been promised something, asylum, money or whatever and assured of their safety. To determine who is behind it you simply need to look at who benefits.

Jackrabbit , Nov 5, 2018 9:35:42 PM | link
Pft

@91 you wrote: The actors are being paid ...

When discussing this caravan "false flag", many people will dismiss "conspiracy theories" that involve paid actors.

RJPJR @98 thought the caravan an an "authentic grass-roots happening that has been hi-jacked" . But that theory is also unsatisfying. As you point out (Pft), it is strange that ordinary people organize themselves to make a march like the caravan.

The best explanation is that people were organized to make the march by local groups [connected to Clinton Global Initiative?] which got PAID to do so. These trusted local groups then told the marchers that: 1) they would get support along the way, and 2) that they have a good/great chance of actually getting asylum.

Organizers would not want a member of the caravan to tell a reporter that the march was fake, or that they are paid. But it has been reported that "well wishers" have given the marchers food and money. And the press has not questioned that support. And the marchers seem to have a genuine belief that they qualify for asylum. Such a belief would be easy to instill in poor, uneducated people who can be easily duped into believing that an international treaty like the Cartegena Declaration applies to all countries.

Peter AU 1 , Nov 5, 2018 9:55:29 PM | link
Jackrabbit, in my post @67 I linked the Pueblo Sin Fronteras website. When I found out about this group I looked for their website which I was able to access, and although information was sparse on this shadowy group, they proudly advertised their work on this caravan.
Since posting a link here I am now censored from that website - security exceptions blah blah.
Not local globalist groups but US based groups or cutouts are the organizers of the caravan.
Jackrabbit , Nov 5, 2018 10:24:10 PM | link
Peter AU1

Good detective work!

But my hunch is that the trail ends with a one or more local groups that are known to people in the area. These poor people basically had to be sold a 'bill of goods'. That's difficult unless you are known/trusted (have a "brand" like Coca-Cola).

There would be several intermediary groups. Maybe a large in-country charity with US connections? And one or more groups outside the country (US, Mexico, even EU) that are connected to / get funding and direction from a major US group.

Let's face it, whoever was behind this would not want the caravan to be connected to back to group with US political connections. And it's probably unlikely that we will find any 'smoking gun' that does that.

The list of Democratic Party-connected organizations that might have originated the idea of a caravan from Central America is small. I surmise Clinton Global Initiative because they would have the requisite connections and blaming Soros seems to easy and convenient. But Soros is also rumored to be behind support for European migrants so it's certainly possible.

It really the same reasoning that led b to suspect that it was CIA/MI6 that foiled assassination plot in Denmark, not Mossad.

[Nov 03, 2018] Kunstler The Midterm Endgame Democrats' Perpetual Hysteria

Highly recommended!
Notable quotes:
"... The Democratic Party split into a four-headed monster comprised of Wall Street patrons seeking favors, war hawks and their corporate allies looking for new global rumbles, the permanent bureaucracy looking to always expand itself, and the various ethnic and sexual minorities whose needs and grievances are serviced by that bureaucracy. It's the last group that has become the party's most public face while the party's other activities – many of them sinister -- remain at least partially concealed. ..."
"... the Republicans are being forced to engage on some real issues, such as the need for a coherent and effective immigration policy and the need to redefine formal trade relations. (Other issues like the insane system of medical racketeering and the deadly racket of the college loan industry just skate along on thin ice. And then, of course, there's the national debt and all its grotesque outgrowths.) ..."
"... Meanwhile, the Democratic Party has become the party of bad ideas and bad faith, starting with the position that "diversity and inclusion" means shutting down free speech, an unforgivable transgression against common sense and common decency. It's a party that lies even more systematically than Mr. Trump, and does so knowingly (as when Google execs say they "Do no Evil"). Its dirty secret is that it relishes coercion, it likes pushing people around, telling them what to think and how to act. Its idea of "social justice" is a campus kangaroo court, where due process of law is suspended. And it is deeply corrupt, with good old-fashioned grift, new-fashioned gross political misconduct in federal law enforcement, and utter intellectual depravity in higher education. ..."
"... I hope that the party is shoved into an existential crisis and is forced to confront its astounding dishonesty. I hope that the process prompts them to purge their leadership across the board. ..."
Nov 03, 2018 | www.zerohedge.com

Kunstler: The Midterm Endgame & Democrats' "Perpetual Hysteria"

by Tyler Durden Fri, 11/02/2018 - 17:05 44 SHARES Authored by James Howard Kunstler via Kunstler.com,

Back in the last century, when this was a different country, the Democrats were the "smart" party and the Republicans were the "stupid" party.

How did that work?

Well, back then the Democrats represented a broad middle class, with a base of factory workers, many of them unionized, and the party had to be smart, especially in the courts, to overcome the natural advantages of the owner class.

In contrast, the Republicans looked like a claque of country club drunks who staggered home at night to sleep on their moneybags. Bad optics, as we say nowadays.

The Democrats also occupied the moral high ground as the champion of the little guy. If not for the Dems, factory workers would be laboring twelve hours a day and children would still be maimed in the machinery. Once the relationship between business and labor was settled in the 1950s, the party moved on to a new crusade on even loftier moral high ground: civil rights, aiming to correct arrant and long-lived injustices against downtrodden black Americans. That was a natural move, considering America's self-proclaimed post-war status as the world's Beacon of Liberty. It had to be done and a political consensus that included Republicans got it done. Consensus was still possible.

The Dems built their fortress on that high ground and fifty years later they find themselves prisoners in it. The factory jobs all vamoosed overseas. The middle class has been pounded into penury and addiction.

The Democratic Party split into a four-headed monster comprised of Wall Street patrons seeking favors, war hawks and their corporate allies looking for new global rumbles, the permanent bureaucracy looking to always expand itself, and the various ethnic and sexual minorities whose needs and grievances are serviced by that bureaucracy. It's the last group that has become the party's most public face while the party's other activities – many of them sinister -- remain at least partially concealed.

The Republican Party has, at least, sobered up some after getting blindsided by Trump and Trumpism. Like a drunk out of rehab, it's attempting to get a life. Two years in, the party marvels at Mr. Trump's audacity, despite his obvious lack of savoir faire. And despite a longstanding lack of political will to face the country's problems, the Republicans are being forced to engage on some real issues, such as the need for a coherent and effective immigration policy and the need to redefine formal trade relations. (Other issues like the insane system of medical racketeering and the deadly racket of the college loan industry just skate along on thin ice. And then, of course, there's the national debt and all its grotesque outgrowths.)

Meanwhile, the Democratic Party has become the party of bad ideas and bad faith, starting with the position that "diversity and inclusion" means shutting down free speech, an unforgivable transgression against common sense and common decency. It's a party that lies even more systematically than Mr. Trump, and does so knowingly (as when Google execs say they "Do no Evil"). Its dirty secret is that it relishes coercion, it likes pushing people around, telling them what to think and how to act. Its idea of "social justice" is a campus kangaroo court, where due process of law is suspended. And it is deeply corrupt, with good old-fashioned grift, new-fashioned gross political misconduct in federal law enforcement, and utter intellectual depravity in higher education.

I hope that Democrats lose as many congressional and senate seats as possible. I hope that the party is shoved into an existential crisis and is forced to confront its astounding dishonesty. I hope that the process prompts them to purge their leadership across the board. If there is anything to salvage in this organization, I hope it discovers aims and principles that are unrecognizable from its current agenda of perpetual hysteria. But if the party actually blows up and disappears, as the Whigs did a hundred and fifty years ago, I will be content. Out of the terrible turbulence, maybe something better will be born.

Or, there's the possibility that the dregs of a defeated Democratic Party will just go batshit crazy and use the last of its mojo to incite actual sedition. Of course, there's also a distinct possibility that the Dems will take over congress, in which case they'll ramp up an even more horrific three-ring-circus of political hysteria and persecution that will make the Spanish Inquisition look like a backyard barbeque. That will happen as the US enters the most punishing financial train wreck in our history, an interesting recipe for epic political upheaval.

[Oct 05, 2018] How the Russia Spin Got So Much Torque by Norman Solomon

Notable quotes:
"... Shattered ..."
"... Yet last year, notably without success, the Clinton campaign devoted plenty of its messaging to the Trump-Russia theme. As the "Shattered" book notes, "Hillary would raise the issue herself repeatedly in debates" with Trump. For example, in one of those debates she said: "We have seventeen – seventeen ..."
"... In early spring, the former communications director of the 2016 Clinton presidential campaign, Jennifer Palmieri, summed up the post-election approach neatly in a Washington Post ..."
"... The inability of top Clinton operatives to identify with the non-wealthy is so tenacious that they still want to assume "the public will be with us" the more they talk about Russia Russia Russia. Imagine sitting at a kitchen table with average-income voters who are worried sick about their financial futures – and explaining to them that the biggest threat they face is from the Kremlin rather than from US government policies that benefit the rich and corporate America at their expense ..."
"... One of the most promising progressives to arrive in Congress this year, Rep. Jamie Raskin from the Maryland suburbs of D.C., promptly drank what might be called the "Klinton Kremlin Kool-Aid." His official website features an article about a town-hall meeting that quotes him describing Trump as a "hoax perpetrated by the Russians on the United States of America. ..."
"... Like hundreds of other Democrats on Capitol Hill, Raskin is on message with talking points from the party leadership. That came across in an email that he recently sent to supporters for a Democratic Congressional Campaign Committee fundraiser. It said: "We pull the curtain back further each day on the Russian Connection, forcing National Security Adviser Michael Flynn to resign, Attorney General Sessions to recuse, and America to reflect on who's calling the shots in Washington. ..."
A new book about Hillary Clinton's last campaign for president – Shattered , by journalists Jonathan Allen and Amie Parnes – has gotten a lot of publicity since it appeared two weeks ago. But major media have ignored a revealing passage near the end of the book.

Soon after Clinton's defeat, top strategists decided where to place the blame. "Within 24 hours of her concession speech," the authors report, campaign manager Robby Mook and campaign chair John Podesta "assembled her communications team at the Brooklyn headquarters to engineer the case that the election wasn't entirely on the up-and-up. For a couple of hours, with Shake Shack containers littering the room, they went over the script they would pitch to the press and the public. Already, Russian hacking was the centerpiece of the argument."

Six months later, that centerpiece of the argument is rampant – with claims often lurching from unsubstantiated overreach to outright demagoguery.

A lavishly-funded example is the "Moscow Project," a mega-spin effort that surfaced in midwinter as a project of the Center for American Progress Action Fund. It's led by Neera Tanden, a self-described "loyal soldier" for Clinton who also runs the Center for American Progress (where she succeeded Podesta as president). The Center's board includes several billionaires.

The "Moscow Project" is expressly inclined to go over the top, aiming to help normalize ultra-partisan conjectures as supposedly factual. And so, the homepage of the "Moscow Project" prominently declares: "Given Trump's obedience to Vladimir Putin and the deep ties between his advisers and the Kremlin, Russia's actions are a significant and ongoing cause for concern."

Let's freeze-frame how that sentence begins: "Given Trump's obedience to Vladimir Putin." It's a jaw-dropping claim; a preposterous smear.

Echoes of such tactics can be heard from many Democrats in Congress and from allied media. Along the way, no outlet has been more in sync than MSNBC, and no one on the network has been more promotional of the Russia-runs-Trump meme than Rachel Maddow, tirelessly promoting the line and sometimes connecting dots in Glenn Beck fashion to the point of journalistic malpractice.

Yet last year, notably without success, the Clinton campaign devoted plenty of its messaging to the Trump-Russia theme. As the "Shattered" book notes, "Hillary would raise the issue herself repeatedly in debates" with Trump. For example, in one of those debates she said: "We have seventeen – seventeen – intelligence agencies, civilian and military, who have all concluded that these espionage attacks, these cyber attacks, come from the highest levels of the Kremlin and they are designed to influence our election ."

After Trump's election triumph, the top tier of Clinton strategists quickly moved to seize as much of the narrative as they could, surely mindful of what George Orwell observed: "Who controls the past controls the future; who controls the present controls the past." After all, they hardly wanted the public discourse to dwell on Clinton's lack of voter appeal because of her deep ties to Wall Street. Political recriminations would be much better focused on the Russian government.

In early spring, the former communications director of the 2016 Clinton presidential campaign, Jennifer Palmieri, summed up the post-election approach neatly in a Washington Post opinion article : "If we make plain that what Russia has done is nothing less than an attack on our republic, the public will be with us. And the more we talk about it, the more they'll be with us."

The inability of top Clinton operatives to identify with the non-wealthy is so tenacious that they still want to assume "the public will be with us" the more they talk about Russia Russia Russia. Imagine sitting at a kitchen table with average-income voters who are worried sick about their financial futures – and explaining to them that the biggest threat they face is from the Kremlin rather than from US government policies that benefit the rich and corporate America at their expense.

Tone deaf hardly describes the severe political impairment of those who insist that denouncing Russia will be key to the Democratic Party's political fortunes in 2018 and 2020. But the top-down pressure for conformity among elected Democrats is enormous and effective.

One of the most promising progressives to arrive in Congress this year, Rep. Jamie Raskin from the Maryland suburbs of D.C., promptly drank what might be called the "Klinton Kremlin Kool-Aid." His official website features an article about a town-hall meeting that quotes him describing Trump as a "hoax perpetrated by the Russians on the United States of America. "

Like hundreds of other Democrats on Capitol Hill, Raskin is on message with talking points from the party leadership. That came across in an email that he recently sent to supporters for a Democratic Congressional Campaign Committee fundraiser. It said: "We pull the curtain back further each day on the Russian Connection, forcing National Security Adviser Michael Flynn to resign, Attorney General Sessions to recuse, and America to reflect on who's calling the shots in Washington. "

You might think that Wall Street, big banks, hugely funded lobbyists, fat-check campaign contributors, the fossil fuel industry, insurance companies, military contractors and the like are calling the shots in Washington. Maybe you didn't get the memo.

Norman Solomon is co-founder of RootsAction.org and founding director of the Institute for Public Accuracy . His books include War Made Easy: How Presidents and Pundits Keep Spinning Us to Death .

[Oct 02, 2018] I m puzzled why CIA is so against Kavanaugh?

Highly recommended!
An interesting hypothesis. CIA definitly became a powerful political force in the USA -- a rogue political force which starting from JFK assasination tries to control who is elected to important offices. But in truth Cavanaugh is a pro-CIA candidate so to speak. So why CIA would try to derail him.
Notable quotes:
"... I think I've figured out why they had to go to couples counseling about an outside door and why she came up with claim that she needed an outside bedroom door because she'd been assaulted 37 years ago. The Palo Alto building codes for single family homes were created to make sure single family homes remained single family and weren't chopped up into apartments. ..."
"... An outside door into a master bedroom with attached bathroom is a red flag that it's intended for an illegal what's called in law apartment ..."
"... So she wants the door. Husband says waste of money and trouble. Contractor says call me when you're ready. So they go to counseling Husband explains why the door's unreasonable. Therapist asks wife why she " really deep down" needs the door. Wife makes up the story about attempted rape 35 years ago flashbacks If only there were 2 doors in that imaginary bedroom she could have escaped. ..."
"... Kacanaugh was nominated. CIA searched for sex problems in his working life. Found nothing Searched law school and college found nothing. In desperation searched high school found nothing. Searched CIA personnel records which go back to grade school and found one of their own employees was about Kavanaugh's age and attended a high school near his and the students socialized. ..."
"... She's 3rd generation CIA. grandfather assistant director. Father CIA contractor who managed CIA unofficial band accounts. And she runs a CIA recruitment office. ..."
Oct 02, 2018 | www.unz.com

Anon [257] Disclaimer says: September 29, 2018 at 8:28 am GMT 400 Words

I think I've figured out why they had to go to couples counseling about an outside door and why she came up with claim that she needed an outside bedroom door because she'd been assaulted 37 years ago. The Palo Alto building codes for single family homes were created to make sure single family homes remained single family and weren't chopped up into apartments.

Outside doors enter public areas kitchen sunroom living rooms not bedrooms. An outside door into a master bedroom with attached bathroom is a red flag that it's intended for an illegal what's called in law apartment

There's a unit It's a stove 2 ft counter space and sink. The stoves electric and plugs into an ordinary household electricity. It's backed against the bathroom wall. Break through the wall, connect the pipes running water for the sink. Add an outside door and it's a small apartment.

Assume they didn't want to make it an apartment just a master bedroom. Usually the contractor pulls the permits routinely. But an outside bedroom door is complicated. The permits will cost more. It might require an exemption and a hearing They night need a lawyer. And they might not get the permit.

So she wants the door. Husband says waste of money and trouble. Contractor says call me when you're ready. So they go to counseling Husband explains why the door's unreasonable. Therapist asks wife why she " really deep down" needs the door. Wife makes up the story about attempted rape 35 years ago flashbacks If only there were 2 doors in that imaginary bedroom she could have escaped.

Kacanaugh was nominated. CIA searched for sex problems in his working life. Found nothing Searched law school and college found nothing. In desperation searched high school found nothing. Searched CIA personnel records which go back to grade school and found one of their own employees was about Kavanaugh's age and attended a high school near his and the students socialized.

She's 3rd generation CIA. grandfather assistant director. Father CIA contractor who managed CIA unofficial band accounts. And she runs a CIA recruitment office.

I'm puzzled why CIA is so against Kavanaugh?

[Oct 02, 2018] Kavanaugh vs Bill Clinton

Looks like Neoliberal Democrats have zero problem with rapists as long as they are democrats.
Oct 02, 2018 | consortiumnews.com

Jean , September 28, 2018 at 11:58 pm

BS

I Believe Juanita

https://www.nytimes.com/2017/11/13/opinion/juanita-broaddrick-bill-clinton.html

What About Bil

https://www.nytimes.com/2017/11/15/us/politics/bill-clinton-sexual-misconduct-debate.amp.html

What Hillary Knew
Hillary Clinton once tweeted that "every survivor of sexual assault deserves to be heard, believed, and supported." What about Juanita Broaddrick?

https://www.google.com/amp/s/www.theatlantic.com/amp/article/546170/

The Clinton Double Standard

https://www.jacobinmag.com/2017/10/bill-clinton-harvey-weinstein-sexual-assault

rife kimler , September 29, 2018 at 6:18 am

So Clinton did not fly around with Jeffery Epstein?

jean , September 29, 2018 at 7:43 pm

https://www.salon.com/2017/10/16/hillary-clinton-weinstein-bbc-trump-bill/

You'd Better Put Some Ice On That: How I Survived Being Raped by Bill Clinton

https://www.goodreads.com/book/show/37797819-you-d-better-put-some-ice-on-that

[Sep 12, 2018] State AGs to Step Up Enforcement Against Tech Companies

Sep 12, 2018 | www.nakedcapitalism.com

Such separate priorities may also extend to areas in which the federal government regulates extensively, such as securities law (or at least did in the not-so-distant past), as I discussed in this post, Mary Jo White Leaves Behind a Weakened SEC for Trump to Weaken Further :

During the administration of President George W. Bush, state attorneys general used state authority to prosecute securities and financial transgressions. Notably, former New York state Attorney General Eliot Spitzer relied on authority provided by the state's 1910 Martin Act, which predates the federal securities law, to take legal action actions against insurance firms for brokerage practices, hedge funds for improper trading practices in mutual fund shares, and investment banks for conflicts of interest that distorted the investment research they provided, to name some of the most significant initiatives. Spitzer's successors as attorney general, current New York Governor Andrew Cuomo and current Attorney General Eric Schneiderman, have not had the impact that Spitzer had when he was lauded as the Sheriff of Wall Street.

Another New York regulator, Benjamin Lawsky, superintendent of New York's Department of Financial Services used the threat of denying a NY state banking charter to force tougher terms on settlements in which the Eric Holder/Loretta Lynch DoJ and other federal regulators had rolled over (see this post by Yves for a summary: Wall Street's Nemesis, Benjamin Lawsky, to Resign in June .).Other states, such as California, have their own expansive statutes– though now-US Senator Kamala Harris demonstrated when she served as California's AG that she more interested in virtue-signalling than taking scalps.

Crusading state AGs are not just Democrats. As I wrote in New EPA Lawsuit Policy Advances Trump's Deregulatory Agenda , Scott Pruitt– who recently stepped down as EPA administrator:

has been a longstanding bugbear of environmentalists. In his previous role as attorney general for the state of Oklahoma– a major producer of oil and natural gas– he either filed or joined lawsuits that sought to stymie the modest pro-regulatory environmental and climate change agenda the EPA previously espoused.

Like-minded Republicans AGs often joined him in these efforts.

So, What's On the Agenda for These AGs?

The most immediate threat to the tech industry might arise in the area of antitrust enforcement– which, shall we say, has not been a major priority for recent administrations, although the European Union has investigated and fined Google over competition concerns. Yet as recently as the Clinton administration, Microsoft was a target of an major antitrust action instigated by multiple state AGs in conjunction with the DoJ

Over to the WSJ again:

The [Sessions meeting ] announcement -- released amid last week's congressional hearings into the practices of Facebook and Twitter -- shed little light on who was raising the concerns or what remedies might be under consideration. But recent comments by several of the state attorneys general suggest they are actively exploring an antitrust investigation and hope to enlist Washington.

"I think the companies are too big, and they need to be broken up," Republican Louisiana Attorney General Jeff Landry said Thursday in a radio interview.

There is some evidence that party politics are driving this potential enforcement initiative:

Republicans' allegations that the tech companies suppress conservative voices has bubbled up for months in conservative media and was amplified by Mr. Trump late last month . Democrats have said that is the issue -- more than antitrust policy -- behind the coming Justice Department meeting, with Republicans hoping to stir their conservative base ahead of November elections

All the attorneys general who are expected to attend this month's meeting in Washington are Republicans, with Democratic officials saying they have yet to be invited.

Although it's too soon to say where these preliminary discussions between the DoJ and the the state AGs may lead, I want to draw attention to another development– the weakening of the hold of corporate Democrats on the direction of the party. David Sirota published an interesting piece in Monday's Guardian, Yes, let's wipe out Trump. But take neoliberal Democrats with him, too .

Sirota's piece wasn't especially concerned about Big Tech per se, and focused on a percolating progressive policy agenda. He mentions regulation, but only as it affects financial firms and pharmaceutical companies and where so far, corporate Democrats have successfully insulated their paymasters from any significant increase in legal liability.

But if progressives start to wield greater influence on the Democratic side– and Republican AGs follow through with a tougher approach to enforcement– the future might shape up to be a less comfortable operating environment for US internet companies. Or at least we might hope. /n

TS , September 12, 2018 at 8:31 am

I can understand antitrust and data-privacy violations but with regard to "stifling the free exchange of ideas" on their platforms, what legal statutes are being violated even if these companies were found to be supressing conservative speech?

Mark , September 12, 2018 at 1:46 pm

The OLG Munich recently decided that Facebook violated the right to free speech of a politician by deleting her post. Facebook gave their community rules as a reason for the deletion. The court ruled that Facebook could not rely on their rights a privat entity to do as they please in their own place (Hausrecht in German) but rather had to uphold the right to free spreech granted by the German constitution. This is a new interpretation of the law by a significant court and possibly transfers some of the burden ususally only placed on the state (uphold free speech) unto a privat company. The reason given is that Facebook is a controlling, monopolistic entity in the realm of social interaction and has therefore more responsibilties. The OLG Munich is the highest court in its court-district, Southern Bavaria, only below the federal court (BGH) and the ruling sets a binding precedent in its district and serves as an interesting opinion for the rest of Germany. Mind you precedent is of a lot less important in Germany than in the case-law US system and there are many differing rulings out there.

I suppose the arguments for supressing conservative speech or something like that might go a similar route in the US.

source: https://www.techdirt.com/articles/20180907/00455240595/german-court-tells-facebook-it-cant-delete-comments-even-though-german-law-says-it-must-delete-comments.shtml

PS: Please excuse the rambling source it is the only one in English I could find; also take my reasoning regarding the court ruling with a pinch of salt since I am not an attorney. At least the apparent confusion between forced deletion on one hand and forced non-deletion on the other hand mentioned in the source is easily explained. Free speech has its limits and violating those is in some cases a criminal offence, e.g. criminal insults, incitement to violance against people, etc.. A recent law in Germany requires sites like Facebook or Twitter to take obvious cases of such posts down, instead of waiting for the police or prosecution to act. This is worthy of a discussion in itself but it still leaves room between what Facebook arbitrarily deems acceptable based in its guidelines and what is acceptable under free speech in Germany, and here the court made their ruling.

[Sep 12, 2018] If You Read This Book, It'll Make You a Radical A Conversation with Thomas Frank by John Siman

Notable quotes:
"... "Let us linger over the perversity," he writes in "Why Millions of Ordinary Americans Support Donald Trump," one of the seventeen component essays in Rendezvous with Oblivion : "Let us linger over the perversity. Left parties the world over were founded to advance the fortunes of working people. But our left party in America -- one of our two monopoly parties -- chose long ago to turn its back on these people's concerns, making itself instead into the tribune of the enlightened professional class, a 'creative class' that makes innovative things like derivative securities and smartphone apps ..."
"... And the real bad news is not that this Creative Class, this Expert Class, this Meritocratic Class, this Professional Class -- this Liberal Class, with all its techno-ecstasy and virtue-questing and unleashing of innovation -- is so deeply narcissistic and hypocritical, but rather that it is so self-interestedly parasitical and predatory. ..."
Sep 11, 2018 | www.nakedcapitalism.com

Thomas Frank's new collection of essays: Rendezvous with Oblivion: Reports from a Sinking Society (Metropolitan Books 2018) and Listen, Liberal; or,Whatever Happened to the Party of the People? (ibid. 2016)

To hang out with Thomas Frank for a couple of hours is to be reminded that, going back to 1607, say, or to 1620, for a period of about three hundred and fifty years, the most archetypal of American characters was, arguably, the hard-working, earnest, self-controlled, dependable white Protestant guy, last presented without irony a generation or two -- or three -- ago in the television personas of men like Ward Cleaver and Mister Rogers.

Thomas Frank, who grew up in Kansas and earned his Ph.D. at the University of Chicago, who at age 53 has the vibe of a happy eager college nerd, not only glows with authentic Midwestern Nice (and sometimes his face turns red when he laughs, which is often), he actually lives in suburbia, just outside of D.C., in Bethesda, where, he told me, he takes pleasure in mowing the lawn and doing some auto repair and fixing dinner for his wife and two children. (Until I met him, I had always assumed it was impossible for a serious intellectual to live in suburbia and stay sane, but Thomas Frank has proven me quite wrong on this.)

Frank is sincerely worried about the possibility of offending friends and acquaintances by the topics he chooses to write about. He told me that he was a B oy Scout back in Kansas, but didn't make Eagle. He told me that he was perhaps a little too harsh on Hillary Clinton in his brilliantly perspicacious "Liberal Gilt [ sic ]" chapter at the end of Listen, Liberal . His piercing insight into and fascination with the moral rot and the hypocrisy that lies in the American soul brings, well, Nathaniel Hawthorne to mind, yet he refuses to say anything (and I tried so hard to bait him!) mean about anyone, no matter how culpable he or she is in the ongoing dissolving and crumbling and sinking -- all his metaphors -- of our society. And with such metaphors Frank describes the "one essential story" he is telling in Rendezvous with Oblivion : "This is what a society looks like when the glue that holds it together starts to dissolve. This is the way ordinary citizens react when they learn that the structure beneath them is crumbling. And this is the thrill that pulses through the veins of the well-to-do when they discover that there is no longer any limit on their power to accumulate" ( Thomas Frank in NYC on book tour https://youtu.be/DBNthCKtc1Y ).

And I believe that Frank's self-restraint, his refusal to indulge in bitter satire even as he parses our every national lie, makes him unique as social critic. "You will notice," he writes in the introduction to Rendezvous with Oblivion, "that I describe [these disasters] with a certain amount of levity. I do that because that's the only way to confront the issues of our time without sinking into debilitating gloom" (p. 8). And so rather than succumbing to an existential nausea, Frank descends into the abyss with a dependable flashlight and a ca. 1956 sitcom-dad chuckle.

"Let us linger over the perversity," he writes in "Why Millions of Ordinary Americans Support Donald Trump," one of the seventeen component essays in Rendezvous with Oblivion : "Let us linger over the perversity. Left parties the world over were founded to advance the fortunes of working people. But our left party in America -- one of our two monopoly parties -- chose long ago to turn its back on these people's concerns, making itself instead into the tribune of the enlightened professional class, a 'creative class' that makes innovative things like derivative securities and smartphone apps " (p. 178).

And it is his analysis of this "Creative Class" -- he usually refers to it as the "Liberal Class" and sometimes as the "Meritocratic Class" in Listen, Liberal (while Barbara Ehrenreich uses the term " Professional Managerial Class ,"and Matthew Stewart recently published an article entitled "The 9.9 Percent Is the New American Aristocracy" in the Atlantic ) -- that makes it clear that Frank's work is a continuation of the profound sociological critique that goes back to Thorstein Veblen's Theory of the Leisure Class (1899) and, more recently, to Christopher Lasch's The Revolt of the Elites (1994).

Unlike Veblen and Lasch, however, Frank is able to deliver the harshest news without any hauteur or irascibility, but rather with a deftness and tranquillity of mind, for he is both in and of the Creative Class; he abides among those afflicted by the epidemic which he diagnoses: "Today we live in a world of predatory bankers, predatory educators, even predatory health care providers, all of them out for themselves . Liberalism itself has changed to accommodate its new constituents' technocratic views. Today, liberalism is the philosophy not of the sons of toil but of the 'knowledge economy' and, specifically, of the knowledge economy's winners: the Silicon Valley chieftains, the big university systems, and the Wall Street titans who gave so much to Barack Obama's 2008 campaign . They are a 'learning class' that truly gets the power of education. They are a 'creative class' that naturally rebels against fakeness and conformity. They are an ' innovation class ' that just can't stop coming up with awesome new stuff" ( Listen, Liberal , pp. 27-29).

And the real bad news is not that this Creative Class, this Expert Class, this Meritocratic Class, this Professional Class -- this Liberal Class, with all its techno-ecstasy and virtue-questing and unleashing of innovation -- is so deeply narcissistic and hypocritical, but rather that it is so self-interestedly parasitical and predatory.

The class that now runs the so-called Party of the People is impoverishing the people; the genius value-creators at Amazon and Google and Uber are Robber Barons, although, one must grant, hipper, cooler, and oh so much more innovative than their historical predecessors. "In reality," Frank writes in Listen, Liberal ,

.there is little new about this stuff except the software, the convenience, and the spying. Each of the innovations I have mentioned merely updates or digitizes some business strategy that Americans learned long ago to be wary of. Amazon updates the practices of Wal-Mart, for example, while Google has dusted off corporate behavior from the days of the Robber Barons. What Uber does has been compared to the every-man-for-himself hiring procedures of the pre-union shipping docks . Together, as Robert Reich has written, all these developments are 'the logical culmination of a process that began thirty years ago when corporations began turning over full-time jobs to temporary workers, independent contractors, free-lancers, and consultants.' This is atavism, not innovation . And if we keep going in this direction, it will one day reduce all of us to day laborers, standing around like the guys outside the local hardware store, hoping for work. (p. 215).

And who gets this message? The YouTube patriot/comedian Jimmy Dore, Chicago-born, ex-Catholic, son of a cop, does for one. "If you read this b ook, " Dore said while interviewing Frank back in January of 2017, "it'll make y ou a radical" (Frank Interview Part 4 https://youtu.be/JONbGkQaq8Q ).

But to what extent, on the other hand, is Frank being actively excluded from our elite media outlets? He's certainly not on TV or radio or in print as much as he used to be. So is he a prophet without honor in his own country? Frank, of course, is too self-restrained to speculate about the motives of these Creative Class decision-makers and influencers. "But it is ironic and worth mentioning," he told me, "that most of my writing for the last few years has been in a British publication, The Guardian and (in translation) in Le Monde Diplomatique . The way to put it, I think, is to describe me as an ex-pundit."

Frank was, nevertheless, happy to tell me in vivid detail about how his most fundamental observation about America, viz. that the Party of the People has become hostile to the people , was for years effectively discredited in the Creative Class media -- among the bien-pensants , that is -- and about what he learned from their denialism.

JS: Going all the way back to your 2004 book What's the Matter with Kansas? -- I just looked at Larry Bartels's attack on it, "What's the Matter with What's the Matter with Kansas?" -- and I saw that his first objection to your book was, Well, Thomas Frank says the working class is alienated from the Democrats, but I have the math to show that that's false. How out of touch does that sound now?

TCF: [laughs merrily] I know.

JS: I remember at the time that was considered a serious objection to your thesis.

TCF: Yeah. Well, he was a professor at Princeton. And he had numbers. So it looked real. And I actually wrote a response to that in which I pointed out that there were other statistical ways of looking at it, and he had chosen the one that makes his point.

JS: Well, what did Mark Twain say?

TCF: Mark Twain?

JS: There are lies, damned lies --

TCF: [laughs merrily] -- and statistics! Yeah. Well, anyhow, Bartels's take became the common sense of the highly educated -- there needs to be a term for these people by the way, in France they're called the bien-pensants -- the "right-thinking," the people who read The Atlantic, The New York Times op-ed page, The Washington Post op-ed page, and who all agree with each other on everything -- there's this tight little circle of unanimity. And they all agreed that Bartels was right about that, and that was a costly mistake. For example, Paul Krugman, a guy whom I admire in a lot of ways, he referenced this four or five times. He agreed with it . No, the Democrats are not losing the white working class outside the South -- they were not going over to the Republicans. The suggestion was that there is nothing to worry about. Yes. And there were people saying this right up to the 2016 election. But it was a mistake.

JS: I remember being perplexed at the time. I had thought you had written this brilliant book, and you weren't being taken seriously -- because somebody at Princeton had run some software -- as if that had proven you wrong.

TCF: Yeah, that's correct . That was a very widespread take on it. And Bartels was incorrect, and I am right, and [laughs merrily] that's that.

JS: So do you think Russiagate is a way of saying, Oh no no no no, Hillary didn't really lose?

TCF: Well, she did win the popular vote -- but there's a whole set of pathologies out there right now that all stem from Hillary Denialism. And I don't want to say that Russiagate is one of them, because we don't know the answer to that yet.

JS: Um, ok.

TCF: Well, there are all kinds of questionable reactions to 2016 out there, and what they all have in common is the faith that Democrats did nothing wrong. For example, this same circle of the bien-pensants have decided that the only acceptable explanation for Trump's victory is the racism of his supporters. Racism can be the only explanation for the behavior of Trump voters. But that just seems odd to me because, while it's true of course that there's lots of racism in this country, and while Trump is clearly a bigot and clearly won the bigot vote, racism is just one of several factors that went into what happened in 2016. Those who focus on this as the only possible answer are implying that all Trump voters are irredeemable, lost forever.

And it comes back to the same point that was made by all those people who denied what was happening with the white working class, which is: The Democratic Party needs to do nothing differently . All the post-election arguments come back to this same point. So a couple years ago they were saying about the white working class -- we don't have to worry about them -- they're not leaving the Democratic Party, they're totally loyal, especially in the northern states, or whatever the hell it was. And now they say, well, Those people are racists, and therefore they're lost to us forever. What is the common theme of these two arguments? It's always that there's nothing the Democratic Party needs to do differently. First, you haven't lost them; now you have lost them and they're irretrievable: Either way -- you see what I'm getting at? -- you don't have to do anything differently to win them.

JS: Yes, I do.

TCF: The argument in What's the Matter with Kansas? was that this is a long-term process, the movement of the white working class away from the Democratic Party. This has been going on for a long time. It begins in the '60s, and the response of the Democrats by and large has been to mock those people, deride those people, and to move away from organized labor, to move away from class issues -- working class issues -- and so their response has been to make this situation worse, and it gets worse, and it gets worse, and it gets worse, and it gets worse! And there's really no excuse for them not seeing it. But they say, believe, rationalize, you know, come up with anything that gets then off the hook for this, that allows them to ignore this change. Anything. They will say or believe whatever it takes.

JS: Yes.

TCF: By the way, these are the smartest people! These are tenured professors at Ivy League institutions, these are people with Nobel Prizes, people with foundation grants, people with, you know, chairs at prestigious universities, people who work at our most prestigious media outlets -- that's who's wrong about all this stuff.

JS: [quoting the title of David Halberstam's 1972 book, an excerpt from which Frank uses as an epigraph for Listen, Liberal ] The best and the brightest!

TCF: [laughing merrily] Exactly. Isn't it fascinating?

JS: But this gets to the irony of the thing. [locates highlighted passage in book] I'm going to ask you one of the questions you ask in Rendezvous with Oblivion: "Why are worshippers of competence so often incompetent?" (p. 165). That's a huge question.

TCF: That's one of the big mysteries. Look. Take a step back. I had met Barack Obama. He was a professor at the University of Chicago, and I'd been a student there. And he was super smart. Anyhow, I met him and was really impressed by him. All the liberals in Hyde Park -- that's the neighborhood we lived in -- loved him, and I was one of them, and I loved him too. And I was so happy when he got elected.

Anyhow, I knew one thing he would do for sure, and that is he would end the reign of cronyism and incompetence that marked the Bush administration and before them the Reagan administration. These were administrations that actively promoted incompetent people. And I knew Obama wouldn't do that, and I knew Obama would bring in the smartest people, and he'd get the best economists. Remember, when he got elected we were in the pit of the crisis -- we were at this terrible moment -- and here comes exactly the right man to solve the problem. He did exactly what I just described: He brought in [pause] Larry Summers, the former president of Harvard, considered the greatest economist of his generation -- and, you know, go down the list: He had Nobel Prize winners, he had people who'd won genius grants, he had The Best and the Brightest . And they didn't really deal with the problem. They let the Wall Street perpetrators off the hook -- in a catastrophic way, I would argue. They come up with a health care system that was half-baked. Anyhow, the question becomes -- after watching the great disappointments of the Obama years -- the question becomes: Why did government-by-expert fail?

JS: So how did this happen? Why?

TCF: The answer is understanding experts not as individual geniuses but as members of a class . This is the great missing link in all of our talk about expertise. Experts aren't just experts: They are members of a class. And they act like a class. They have loyalty to one another; they have a disdain for others, people who aren't like them, who they perceive as being lower than them, and there's this whole hierarchy of status that they are at the pinnacle of.

And once you understand this, then everything falls into place! So why did they let the Wall Street bankers off the hook? Because these people were them. These people are their peers. Why did they refuse to do what obviously needed to be done with the health care system? Because they didn't want to do that to their friends in Big Pharma. Why didn't Obama get tough with Google and Facebook? They obviously have this kind of scary monopoly power that we haven't seen in a long time. Instead, he brought them into the White House, he identified with them. Again, it's the same thing. Once you understand this, you say: Wait a minute -- so the Democratic Party is a vehicle of this particular social class! It all makes sense. And all of a sudden all of these screw-ups make sense. And, you know, all of their rhetoric makes sense. And the way they treat working class people makes sense. And they way they treat so many other demographic groups makes sense -- all of the old-time elements of the Democratic Party: unions, minorities, et cetera. They all get to ride in back. It's the professionals -- you know, the professional class -- that sits up front and has its hands on the steering wheel.

* * *

It is, given Frank's persona, not surprising that he is able to conclude Listen, Liberal with a certain hopefulness, and so let me end by quoting some of his final words:

What I saw in Kansas eleven years ago is now everywhere . It is time to face the obvious: that the direction the Democrats have chosen to follow for the last few decades has been a failure for both the nation and for their own partisan health . The Democrats posture as the 'party of the people' even as they dedicate themselves ever more resolutely to serving and glorifying the professional class. Worse: they combine self-righteousness and class privilege in a way that Americans find stomach-turning . The Democrats have no interest in reforming themselves in a more egalitarian way . What we can do is strip away the Democrats' precious sense of their own moral probity -- to make liberals live without the comforting knowledge that righteousness is always on their side . Once that smooth, seamless sense of liberal virtue has been cracked, anything becomes possible. (pp. 256-257).

[Aug 08, 2018] Bill Clinton's Rules of Engagement on the already identified Enemies of the People

Notable quotes:
"... please recall Bill Clinton's rules of engagement as applied to the Serbs in 1999, wherein he decided that the political leaders, bureaucratic support structure, media infrastructure and intellectual underpinnings of his enemies' war effort were legitimate targets of war. ..."
Aug 08, 2018 | www.unz.com

Anonymous [207] Disclaimer , Next New Comment August 8, 2018 at 7:08 am GMT

After observing Skynet's coordinated attack on Alex Jone's Infowars yesterday, we can hardly wait to implement Bill Clinton's Rules of Engagement on the already identified Enemies of the People, and eagerly await the God-Emperor's word.

Second, please recall Bill Clinton's rules of engagement as applied to the Serbs in 1999, wherein he decided that the political leaders, bureaucratic support structure, media infrastructure and intellectual underpinnings of his enemies' war effort were legitimate targets of war.

No one else may have been paying attention to the unintended consequences of that, but many folks on our side of the present divide were. Food for thought. A reminder about the shape of the battlefield (legal and otherwise) and Bill Clinton's Rules of Engagement.

http://sipseystreetirregulars.blogspot.com/2010/03/man-bites-dog-dogs-get-pissed-off.html

[Aug 07, 2018] Trillion Dollar Companies the Apple Empire and Concentrated Markets by Binoy Kampmark

Notable quotes:
"... New York Times ..."
"... The Four: The Hidden DNA of Amazon, Apple, Facebook and Google ), ..."
"... Power and influence has shifted. Political leaders have little of these relatively speaking, certainly over the behavioural consistency and content of subjects and citizens. Someone like Mark Zuckerberg, distinctly outside a political process he can still control, does. "He can turn off or on your mood. He can take any product up or down. He can pretty much kill any company in the tech space." And that's just Facebook. ..."
Aug 07, 2018 | www.counterpunch.org

It seems a distant reality, or nightmare now: a company that was near defunct in 1996, now finding itself at the imperial pinnacle of the corporate ladder. Then, publications were mournful and reflective about the corporation that gave us the Apple Computer. An icon had fallen into disrepair. Then came the renovations, the Steve Jobs retooling and sexed-up products of convenience.

Apple's valuation last Thursday came in at $1 trillion and may well make it the first trillion dollar company on the planet. That its assets are worth more than a slew of countries is surely something to be questioned rather than cheered. This un-elected entity, with employees versed in evading, as far as possible, the burdens of public accountability, poses a troubling minder about how concentrated financial power rarely squares with democratic governance.

Chalking up such a mark is only impressive for those keeping an eye on the trillion dollar line. China's state-owned PetroChina is another muscular contender for getting there first , while the Saudi Arabian energy company Aramco, which produces a far from negligible 10 percent of the world's oil, could well scoot past Apple should it go public.

Cheering was exactly what was demanded by James Pethokoukis of the American Enterprise Institute, whose piece in The Week suggests that Apple reached that mark "the right way". The critics of such concentrated power, technology company or otherwise, were simply wrong. "For them, superbig is automatically superbad."

Praise for Apple, an abstract being, is warranted in the way that its ally, modern capitalism, should be. "The story of Apple is really the story of modern capitalism doing what it does best: turning imagination into reality." The author prefers to see Apple, and Amazon, as products of US genius in the capitalist context.

The New York Times is similarly impressed, linking individual gargantuan successes to the broader American effort in the economy. A small gaggle of US companies commanding "a larger share of total corporate profits" than at any time since the 1970s, is not necessarily something to snort at. The nine-year bull market has, essentially, been powered by the four technology giants. "Their successes are also propelling the broader economy, which is on track for its fastest growth rate in a decade."

To its credit, the paper does pay lip service to concerns that such "superstar firms" are doing their bit to stifle wage growth, shrink an already struggling, barely breathing middle class, while jolting income inequality.

This is where the trouble lies: a seemingly blind understanding of capitalism's inner quirks and unstable manifestations. The paradox behind the tech giant phenomenon does not lie in the wisdom that innovation comes from competition. The converse is claimed to be true: that concentration, oligopolistic power, and strings pulled by a few players is the way to keep innovation alive. This was Microsoft's vain argument during the 1990s, something that did not sit well with the antitrust denizens.

The fraternity of economists, rarely capable in agreeing on broader trends, has become abuzz with literature focused on one unsettling topic: the continuing, and accelerating concentration of US industry. Gustavo Grullon, Yelena Larkin and Roni Michaely noted in April last year that government policies encouraging competition in industry had been "drastically reversed in the US" with a 75 percent increase in the Herfindahl-Hirschman index (HHI) measuring market concentration. (Antitrust regulators beware.) The authors observe how, "Lax enforcement of antitrust regulations and increasingly technological barriers to entry appear to be important factors behind this trend."

Marketing professor from NYU, Scott Galloway, is one who has supped from the cup of the tech giants. He has written about their exploits ( The Four: The Hidden DNA of Amazon, Apple, Facebook and Google ), his addresses having become something of a viral phenomenon with analyses of the companies at the DLD Conference in Munich. Initially seduced by the bling and the product, he enjoyed the magic mushroom inducements the tech giants supplied, relished in their success and stock options, extolled their alteration of human behaviour. "This started as a love affair. I want to be clear. I love these companies."

This year, a change of heart took place. Galloway, after spending "the majority of the last two years" of his life "really trying to understand them and the relationship with the ecosystem" is convinced that these behemoths must be broken up. The big four, striving all powerful deities, sources of mass adoration, have become "our consumptive gods". "And as a result of their ability to tap into these very basic instincts, they've aggregated more market cap than the majority of nation's GDP".

Power and influence has shifted. Political leaders have little of these relatively speaking, certainly over the behavioural consistency and content of subjects and citizens. Someone like Mark Zuckerberg, distinctly outside a political process he can still control, does. "He can turn off or on your mood. He can take any product up or down. He can pretty much kill any company in the tech space." And that's just Facebook.

What Galloway points out with a forceful relevance is that liberties and freedoms are not the preserve of estranged markets and their bullish actors. Regulation and oversight are required. A return to competition would only be possible through some form of intervention and coaxing, perhaps even economic violence. The memory of the great financial crisis initially stimulated an appetite for regulation. In recent years, such urgings have been satiated. The tech giants, fully aware of this, continue to burgeon.

[Aug 04, 2018] The US empire was always conducting trade wars that even included deliberately created cartels

Notable quotes:
"... These laws allow a company that believes a foreign rival is selling a product below cost to request that the government impose special tariffs to protect it. Selling products below cost is called dumping, and the duties are called dumping duties. Often, however, the U.S. government determines costs on the basis of little evidence, and in ways which make little sense. To most economists, the dumping duties are simply naked protectionism. Why, they ask, would a rational firm sell goods below cost? ..."
"... Cartels work by restricting output, thereby raising prices. O'Neill's interest was no surprise to me; what did surprise me was the idea that the U.S. government would not only condone a cartel but actually play a pivotal role in setting one up. He also raised the specter of using the antidumping laws if the cartel was not created. These laws allow the United States to impose special duties on goods that arc sold at below a "fair market value," and particularly when they are sold below the cost of production. ..."
"... The reality is that the US empire was always conducting trade wars that included not only tariffs on specific products, but even deliberately created cartels. ..."
"... In the early 90s the Clinton administration uncritically adopted the neoliberal doctrine from Ronald Reagan and continued the big fraud against the majority of the Americans. ..."
"... On the one hand, the Clinton administration was selling the big fairy tale of neoliberalism to the American public: free market capitalism would bring prosperity for all through that trickle-down fiasco. And it was translated, as always, in further cuts in public spending - more tax-cuts for the super-rich. On the other hand, behind the scenes, the same administration was implementing the most aggressive protectionism in favor of some US corporations and against consumers. ..."
Aug 04, 2018 | failedevolution.blogspot.com

Donald Trump is using his trade wars to support the part of the US capital that has heavily lost from free trade globalization, which is more powerful than ever in our days. This is also part of the Trump agenda to persuade Americans for his "patriotic devotion" based on his "America First" slogan.

The reality is that the US empire was always conducting trade wars that included not only tariffs on specific products, but even deliberately created cartels.

In the early 90s the Clinton administration uncritically adopted the neoliberal doctrine from Ronald Reagan and continued the big fraud against the majority of the Americans.

On the one hand, the Clinton administration was selling the big fairy tale of neoliberalism to the American public: free market capitalism would bring prosperity for all through that trickle-down fiasco. And it was translated, as always, in further cuts in public spending - more tax-cuts for the super-rich. On the other hand, behind the scenes, the same administration was implementing the most aggressive protectionism in favor of some US corporations and against consumers.

In his book Globalization and its discontents , Joseph Stiglitz describes how the United States under Clinton administration set up a cartel in favor of the US aluminum industry:

The United States supports free trade, but all too often, when a poor country does manage to find a commodity it can export to the United States, domestic American protectionist interests are galvanized. This mix of labor and business interests uses the many trade laws - officially referred to as "fair trade laws," but known outside the United States as "unfair fair trade laws"- to construct barbed-wire barriers to imports.

These laws allow a company that believes a foreign rival is selling a product below cost to request that the government impose special tariffs to protect it. Selling products below cost is called dumping, and the duties are called dumping duties. Often, however, the U.S. government determines costs on the basis of little evidence, and in ways which make little sense. To most economists, the dumping duties are simply naked protectionism. Why, they ask, would a rational firm sell goods below cost?

During my term in government, perhaps the most grievous instance of U.S. special interests interfering in trade - and the reform process - occurred in early 1994, just after the price of aluminum plummeted. In response to the fall in price, U.S. aluminum producers accused Russia of dumping aluminum.

Any economic analysis of the situation showed clearly that Russia was not dumping. Russia was simply selling aluminum at the international price, which was lowered both because of a global slowdown in demand occasioned by slower global growth and because of the cutback in Russian aluminum use for military planes. Moreover, new soda can designs used substantially less aluminum than before, and this also led to a decline in the demand.

As I saw the price of aluminum plummet, I knew the industry would soon be appealing to the government for some form of relief, either new subsidies or new protection from foreign competition. But even I was surprised at the proposal made by the head of Alcoa, Paul O'Neill: a global aluminum cartel.

Cartels work by restricting output, thereby raising prices. O'Neill's interest was no surprise to me; what did surprise me was the idea that the U.S. government would not only condone a cartel but actually play a pivotal role in setting one up. He also raised the specter of using the antidumping laws if the cartel was not created. These laws allow the United States to impose special duties on goods that arc sold at below a "fair market value," and particularly when they are sold below the cost of production.

I worked hard to convince those in the National Economic Council that it would be a mistake to support O'Neill's idea, and I made great progress. But in a heated subcabinet meeting, a decision was made to support the creation of an international cartel.

While I had managed to convince almost everyone of the dangers of the cartel solution, two voices dominated. The State Department, with its close connections to the old-line state ministries, supported the establishment of a cartel. The State Department prized order above all else, and cartels do provide order. The old-line ministries, of course, were never convinced that this movement to prices and markets made sense in the first place, and the experience with aluminum simply served to confirm their views.

Rubin, at that time head of the National Economic Council, played a decisive role, siding with State. At least for a while, the cartel did work. Prices were raised. The protfits of Alcoa and other producers were enhanced. The American consumers - and consumers throughout the world - lost, and indeed, the basic principles of economics, which teach the value of competitive markets, show that the losses to consumers outweigh the gains to producers. Donald Trump is using his trade wars to support the part of the US capital that has heavily lost from free trade globalization, which is more powerful than ever in our days. This is also part of the Trump agenda to persuade Americans for his "patriotic devotion" based on his "America First" slogan.

The reality is that the US empire was always conducting trade wars that included not only tariffs on specific products, but even deliberately created cartels.

In the early 90s the Clinton administration uncritically adopted the neoliberal doctrine from Ronald Reagan and continued the big fraud against the majority of the Americans.

On the one hand, the Clinton administration was selling the big fairy tale of neoliberalism to the American public: free market capitalism would bring prosperity for all through that trickle-down fiasco. And it was translated, as always, in further cuts in public spending - more tax-cuts for the super-rich. On the other hand, behind the scenes, the same administration was implementing the most aggressive protectionism in favor of some US corporations and against consumers.

In his book Globalization and its discontents , Joseph Stiglitz describes how the United States under Clinton administration set up a cartel in favor of the US aluminum industry:

The United States supports free trade, but all too often, when a poor country does manage to find a commodity it can export to the United States, domestic American protectionist interests are galvanized. This mix of labor and business interests uses the many trade laws - officially referred to as "fair trade laws," but known outside the United States as "unfair fair trade laws"- to construct barbed-wire barriers to imports.

These laws allow a company that believes a foreign rival is selling a product below cost to request that the government impose special tariffs to protect it. Selling products below cost is called dumping, and the duties are called dumping duties. Often, however, the U.S. government determines costs on the basis of little evidence, and in ways which make little sense. To most economists, the dumping duties are simply naked protectionism. Why, they ask, would a rational firm sell goods below cost?

During my term in government, perhaps the most grievous instance of U.S. special interests interfering in trade - and the reform process - occurred in early 1994, just after the price of aluminum plummeted. In response to the fall in price, U.S. aluminum producers accused Russia of dumping aluminum.

Any economic analysis of the situation showed clearly that Russia was not dumping. Russia was simply selling aluminum at the international price, which was lowered both because of a global slowdown in demand occasioned by slower global growth and because of the cutback in Russian aluminum use for military planes. Moreover, new soda can designs used substantially less aluminum than before, and this also led to a decline in the demand.

As I saw the price of aluminum plummet, I knew the industry would soon be appealing to the government for some form of relief, either new subsidies or new protection from foreign competition. But even I was surprised at the proposal made by the head of Alcoa, Paul O'Neill: a global aluminum cartel.

Cartels work by restricting output, thereby raising prices. O'Neill's interest was no surprise to me; what did surprise me was the idea that the U.S. government would not only condone a cartel but actually play a pivotal role in setting one up. He also raised the specter of using the antidumping laws if the cartel was not created. These laws allow the United States to impose special duties on goods that arc sold at below a "fair market value," and particularly when they are sold below the cost of production.

I worked hard to convince those in the National Economic Council that it would be a mistake to support O'Neill's idea, and I made great progress. But in a heated subcabinet meeting, a decision was made to support the creation of an international cartel.

While I had managed to convince almost everyone of the dangers of the cartel solution, two voices dominated. The State Department, with its close connections to the old-line state ministries, supported the establishment of a cartel. The State Department prized order above all else, and cartels do provide order. The old-line ministries, of course, were never convinced that this movement to prices and markets made sense in the first place, and the experience with aluminum simply served to confirm their views.

Rubin, at that time head of the National Economic Council, played a decisive role, siding with State. At least for a while, the cartel did work. Prices were raised. The protfits of Alcoa and other producers were enhanced. The American consumers - and consumers throughout the world - lost, and indeed, the basic principles of economics, which teach the value of competitive markets, show that the losses to consumers outweigh the gains to producers.

http://digamo.free.fr/stig2002

It was the time where the Democrats had become Republicans and the US bipartisan dictatorship was established for good to serve the corporate America.

https://youtu.be/8d1ibtOVImg

[Jul 30, 2018] Google Bitten by 2nd Antitrust Fine in the EU, $5 Billion, Hugest Ever Anywhere. Third Waiting in the Wings by Lambert Strether

Notable quotes:
"... By Wolf Richter, a San Francisco based executive, entrepreneur, start up specialist, and author, with extensive international work experience. Originally published at Wolf Street. ..."
"... But don't cry for Google. These practices helped it earn it a net profit of $12.7 billion in 2017 and of $19.5 billion in 2016. The decision and a fine of enormous magnitude has been expected. And Google's shares are currently flat for the day. ..."
"... "The decision and a fine of enormous magnitude has been expected. And Google's shares are currently flat for the day." ..."
"... An unlocked phone direct from the mfg instead of the carrier will have fewer apps. Also you can disable many apps, just ignore the "may cause other apps to misbehave " message; it isn't true. Some of the apps you do need, and online forums will list which you need and which you don't. ..."
"... if you can quit FB cold turkey you can reduce your exposure to Google. For example I went back to using a paper calendar. ..."
"... LineageOS is a current Android version and not several years old like with earlier Moto G versions, it gets up to date security patches, has no spyware. You can even install only the Google Apps you want, and can delete or uninstall pretty much anything. Especially on older phones with limited storage this is a godsend. ..."
Jul 19, 2018 | www.nakedcapitalism.com

Lambert here: The EU doesn't mess around, does it?

By Wolf Richter, a San Francisco based executive, entrepreneur, start up specialist, and author, with extensive international work experience. Originally published at Wolf Street.

In the US, the internet giants – Google, Facebook, Amazon, et al. – can do pretty much as they please, interrupted only by occasional hearings in Congress, where Mark Zuckerberg, or whoever, has to grin-and-bear it for a few hours, knowing that this too shall pass. The EU takes antitrust actions against super-dominant giants a tad more seriously.

The EU's Competition Commission, after a three-year investigation, hit Google with a €4.3 billion antitrust fine – $5 billion – the highest fine ever by any antitrust agency anywhere.

No one dominates like Google. According to earlier EU findings cited by Bloomberg , Google's market share exceeds 90% for general Internet search, licensed mobile device operating systems, and app stores for Android software.

"Google has used Android as a vehicle to cement the dominance of its search engine," EU Competition Commissioner Margrethe Vestager told reporters. "These practices have denied rivals the chance to innovate and compete on the merits."

The fine is so large because of Google's "very serious illegal behavior" going back to 2011 and due to the huge revenues Google has earned with this behavior, she said.

In addition, Google was given 90 days to stop its "illegal practices" of forcing cellphone makers that use Google's Android operating system to install Google apps.

This fine comes on top of the €2.4-billion fine the EU hit Google with in 2017 after an investigation into Google's shopping-search service.

And the EU is not through yet. It's investigating Google's online advertising contracts and could issue an additional fine. Online advertising is Google's primary revenues source.

Bloomberg:

The EU said Google ensures that Google Search and Chrome are pre-installed on "practically all Android devices" sold in Europe. Users who find these apps on their phones are likely to stick with them and "do not download competing apps in numbers that can offset the significant commercial advantage derived on pre-installation."

Google's actions reduce the incentives for manufacturers to install and for users to seek out competing apps, it said.

The probe targeted contracts that require Android-phones makers to take Google's search and browser apps and other Google services when they want to license the Play app store, which officials say is a "must-have" for new phones.

The EU also found illegal Google's "significant financial incentives" to telecoms operators and manufacturers that exclusively install Google search on devices. Rivals couldn't compete with these payments, making it difficult for any other search engine to get their app pre-installed. The EU said Google stopped doing this in 2014.

Google's contracts also prevented handset makers selling phones using other versions of Android, the EU said. This hampered manufacturers from making devices using Amazon.com Inc.'s Fire OS Android version, it said.

Regulators rejected arguments that Apple Inc. competes with Android, saying Apple's phone software can't be licensed by handset makers and that Apple phones are often priced outside many Android users' purchasing power. Users face "switching costs" to move from Apple to Android and would continue to face Google Search as a default on Apple devices.

In a long statement on its blog , holier-than-thou Google praises itself from A through Z, in essence portraying itself as the greatest gift to mankind and that therefore, it should be allowed to do as it pleases. It includes this:

Today, because of Android, there are more than 24,000 devices, at every price point, from more than 1,300 different brands, including Dutch, Finnish, French, German, Hungarian, Italian, Latvian, Polish, Romanian, Spanish and Swedish phone makers.

And these devices are running on Android. In other words: Google is everywhere, and its ads and apps are on all these devices. Hence the Competition Commission's point: if you're this dominant, you've got to follow some rules.

At the end of its long statement, Google said: "We intend to appeal." Companies always appeal fines. Google is no exception. And the end product might be much less ambitious.

At the press conference, Vestager said it was up to Google to figure out how to comply with the Commission's order. "The obvious minimum" Google would need to do, she said, is that the "contractual restrictions disappear."

But don't cry for Google. These practices helped it earn it a net profit of $12.7 billion in 2017 and of $19.5 billion in 2016. The decision and a fine of enormous magnitude has been expected. And Google's shares are currently flat for the day.

"This emerging trend highlights just how much risk some investors are willing to take in the current environment." Read As Risks Balloon, Yield Chasers Blow Off the Fed


Raulb , July 19, 2018 at 7:32 am

It's interesting free market advocates are always going on about regulations, the need for free markets and market efficiency but don't seem to care so much about monopolies, outsize profits, the concentration of market power and its abuse that further impedes the operation of free markets and the billionaires that result.

Google's dominance in search and mobile is market failure. Facebook's dominance of social is market failure. Amazon's dominance is market failure, Apple being able to accumulate $800 billion it does not know what to do with is market failure.

Under conventional market theory all these entities would have stiff competition and not be able to accumulate outsize profits or monopoly power so the question is where is the competition and how come the the market is not working? And while the theories continue these firms concentrate even more power, control and windfall profits.

How come free market advocates always seem to be more concerned about attempts to impose minimum wages, health care or proper working conditions on amazon workers for instance than any of this? And we will not even talk about negative externalities like the emergence of a global spyware economy based on surveillance and creepily staking people 24/7. And using seemingly endless 'VC funds' to build these US centric monopolies.

oaf , July 19, 2018 at 8:17 am

We are being stalked; and a virtual individual, more or less fleshed-out, is created in the Cloud for each of us it is based on our behavior, every possible detail of which is incorporated into the dossier. How accurate these representations are can be affected by multiple variables Fake news? How about *Fake Browsing* or *Fake Shopping*. Feel free to experiment!!!

Carolinian , July 19, 2018 at 11:37 am

We are being stalked by allowing ourselves to be stalked. All Android apps carry a "permissions" warning telling how they are planning to stalk you. And of course smartphones themselves are spybots by design–a business model pioneered by Apple, not Google. One could argue that many of the worst current practices of Google are the result of trying to imitate competitors such as Apple and Facebook.

Android is based on open source Linux and there's probably no reason why smartphone manufacturers couldn't get their free operating systems elsewhere. Perhaps one big reason they don't is that they are in on the stalking.

blennylips , July 19, 2018 at 3:48 pm

Back in 2013, a google engineer, Beena Bhatia, took out this patent for google: http://patft.uspto.gov/netacgi/nph-Parser ..blah..blah..blah

I found in a marginalrevolution.com article back then. Turns out MR got it from here: http://www.dailymail.co.uk/sciencetech/article-2515635/Google-files-patent-robot-writes-Facebook-posts-emails-tweets–need-FULL-access-scan-accounts.html

The patent was filed by a Google software engineer on behalf of the firm It describes a system that analyses a user's online posts, emails and texts The system, or bot, would then generate automated replies for future posts These replies would be written in a way that mimics that person's usual language and tone

From the patient:

( 1 of 1 )
United States Patent 8,589,407
Bhatia November 19, 2013
Automated generation of suggestions for personalized reactions in a social network

Abstract

A system and method for automatic generating suggestions for personalized reactions or messages. A suggestion generation module includes a plurality of collector modules, a credentials module, a suggestion analyzer module, a user interface module and a decision tree. The plurality of collector modules are coupled to respective systems to collect information accessible by the user and important to the user from other systems such as e-mail systems, SMS/MMS systems, micro blogging systems, social networks or other systems. The information from these collector modules is provided to the suggestion analyzer module. The suggestion analyzer module cooperates with the user interface module and the decision tree to generate suggested reactions or messages for the user to send. The suggested reactions or messages are presented by the user interface module to the user. The user interface module also displays the original message, other information about the original message such as others' responses, and action buttons for sending, discarding or ignoring the suggested message.

If representations are not accurate, you need to volunteer more info till they get you right.

ST , July 19, 2018 at 8:38 am

"The decision and a fine of enormous magnitude has been expected. And Google's shares are currently flat for the day."

As big a fine as this is that last sentence shows that fines don't work. A monopolist will always pass on fines for it's illegal behaviour to its (captive) consumer/s. The only remedy is for criminal proceedings to be bought against it's senior officers with guaranteed jail time to persuade them to stop. That or breaking up the company.

pretzelattack , July 19, 2018 at 9:35 am

and antitrust law enforcement is a joke in the u.s. but hey, russia russia russia.

Big River Bandido , July 19, 2018 at 11:10 am

One serious project for the left, once it gains power, will be to reverse and destroy the entire line of legal argument that grants personhood to corporations.

Of particular harm are the court decisions on this point in the last 20 years or so, which have brought this concept to its logical extreme. (I'm thinking in particular of the recent gay-wedding-cake case, in which the Court [i.e., Justice Kennedy] implied that corporations have a right to hold, promote, and exercise political opinions, just as if they were a real person with the fiat. The so-called rationale of that decision is far worse in its long-term implications than the immediate outcome of the case.)

nervos belli , July 19, 2018 at 3:10 pm

Even a monopolist cannot simply Ma pass on the fines. Cause if they could have increased prices already since as you write, they are monopoly. Why haven't they done it? Monopolists are not dumb, they already extract the maximum price they think the market can bear.

LarryB , July 19, 2018 at 11:12 am

In the end, the only effect that this is going to have is to transfer money from Google to the EU. Cell phone manufacturers will install Chrome and Google Search whether Google requires it or not. There simply isn't anything else out there that works as well.

Arizona Slim , July 19, 2018 at 11:28 am

Yours Truly has an Android phone. With more than 150 apps, and guess what: I didn't install most of them. They simply came with the phone.

I can recall a recent incident when I needed to call 911 and my phone was off. I turned it on, and, guess what, those 150-plus apps just HAD to update. That process took 15 minutes.

Fortunately, I wasn't in a life-threatening situation. I was only trying to call to report gunfire nearby. In central Tucson, that happens fairly often.

Since the phone was in update mode for 15 minutes before I could even get to the opening screen with the "emergency call" link, I decided not to call 911. It was simply too late to make a timely report.

If I had my druthers, I'd rather have a phone with just a handful of apps. I don't need all of this Google crud. Especially if if poses a risk to health and safety.

albert , July 19, 2018 at 12:50 pm

Why do you put up with 150 apps?

Are you implying that you can't uninstall them?

. .. . .. -- .

ChiGal in Carolina , July 19, 2018 at 2:46 pm

An unlocked phone direct from the mfg instead of the carrier will have fewer apps. Also you can disable many apps, just ignore the "may cause other apps to misbehave " message; it isn't true. Some of the apps you do need, and online forums will list which you need and which you don't.

On my current Android form I have not signed into Chrome and use DDG instead of Google. Pretty much easy as pie Slim, attagirl -- if you can quit FB cold turkey you can reduce your exposure to Google. For example I went back to using a paper calendar.

oh , July 19, 2018 at 2:54 pm

Root your phone and delete all those apps including Google's. Don't use anything google -- gmail, youtube, chrome, google search, google voice, google groups and more of the EVIL company's concoctions created solely to spy on you and sell your data.

Needless to say the crooked cell phone carriers will farm your data and track you.

I'm so sick of these crooked companies, google, facebook, netflix, whatsapp, linkedin and others that snoop on you. Get tutamail or protonmail for your e-mail.

nervos belli , July 19, 2018 at 2:59 pm

Root your phone and delete all those apps including Google's.

This is the wrong way to approach this. The right way ist to install a 3rd party ROM like LineageOS and then not install any gapps.

Be prepared however that only very few programs will work. You will then lack Google play services and they are needed for many many programs. Not much more than what is in f-droid. There is of course no play store whatsoever then.

nervos belli , July 19, 2018 at 3:04 pm

What exact phone model is it?

Arizona Slim , July 19, 2018 at 6:07 pm

It's a Moto G from Motorola.

nervos belli , July 20, 2018 at 10:27 am

For whatever reason my reply didn't go through this morning.PS: this is now the third attempt even. Now replacing all URLs in hope it will go through

I wrote exact model for a reason: there are about two dozen different Moto G versions over 6 years of releases.

Pretty much all of them allow however LineageOS or other third party Android images. Those have no bloatware apps except what comes with the OS itself. If the LineageOS download section has no image for your specific phone, then visit xda-developers forum or needrom which both have even more.

LineageOS is a current Android version and not several years old like with earlier Moto G versions, it gets up to date security patches, has no spyware. You can even install only the Google Apps you want, and can delete or uninstall pretty much anything.
Especially on older phones with limited storage this is a godsend.

Synoia , July 19, 2018 at 11:40 am

I believe that under German law (and I'm not 100% positive of this), executives and directors can become personally liable for the actions of the businesses they manage.

A $5 Billion levied on directors and management, and not shareholders, would appear to be more effective.

Those responsible bear none of the penalty. And, if corporation be people, then is the corporation and its officers conspiring?

ChiGal in Carolina , July 19, 2018 at 2:53 pm

I hope Eric Schmidt pays all $5b out of his pocket and they use it to fund the studies of monopoly impacts he put the kibosh on. Some community service too wouldn't be a bad idea for such a bully.

nervos belli , July 19, 2018 at 3:02 pm

We have the same sort of corporate veil in Germany as all other modern western capitalist countries in form of "Kapitalgesellschaft". A public company is such a company, the other would be the GmbH aka Ltd.

A manager who does criminal things (see Diesel scandal VW/VAG an Audi manager was recently held in custody) can be held liable including fines or jail. But I don't know of any anti-trust actions which pierced the veil.

David Carl Grimes , July 19, 2018 at 12:48 pm

What ever happened to "Don't be evil"

[Jul 24, 2018] Bernie Sanders embraces the anti-Russia campaign by Patrick Martin

Notable quotes:
"... Sanders's support for the anti-Russia and anti-Wikileaks campaign is all the more telling because he was himself the victim of efforts by the Clinton campaign and the Democratic Party leadership to block his 2016 campaign. In June and July 2016, Wikileaks published internal Democratic emails in which officials ridiculed the Sanders campaign, forcing the DNC to issue a public apology: "On behalf of everyone at the DNC, we want to offer a deep and sincere apology to Senator Sanders, his supporters, and the entire Democratic Party for the inexcusable remarks made over email." ..."
"... In the aftermath of his election campaign, Sanders was elevated into a top-level position in the Democratic Party caucus in the US Senate. His first response to the inauguration of Trump was to declare his willingness to "work with" the president, closely tracking remarks of Obama that the election of Trump was part of an "intramural scrimmage" in which all sides were on the same team. As the campaign of the military-intelligence agencies intensifies, however, Sanders is toeing the line. ..."
"... The Sanders campaign did not push the Democrats to the left, but rather the state apparatus of the ruling class brought Sanders in to give a "left" veneer to a thoroughly right-wing party. ..."
"... There is no contradiction between the influx of military-intelligence candidates into the Democratic Party and the Democrats' making use of the services of Sanders and Ocasio-Cortez to give the party a "left" cover. Both the CIA Democrats and their pseudo-left "comrades" agree on the most important questions: the defense of the global interests of American imperialism and a more aggressive intervention in the Syrian civil war and other areas where Washington and Moscow are in conflict. ..."
Jul 23, 2018 | www.wsws.org

Vermont Senator Bernie Sanders appeared on the CBS interview program "Face the Nation" Sunday and fully embraced the anti-Russia campaign of the US military-intelligence apparatus, backed by the Democratic Party and much of the media.

In response to a question from CBS host Margaret Brennan, Sanders unleashed a torrent of denunciations of Trump's meeting and press conference in Helsinki with Russian President Vladimir Putin. A preliminary transcript reads:

SANDERS: "I will tell you that I was absolutely outraged by his behavior in Helsinki, where he really sold the American people out. And it makes me think that either Trump doesn't understand what Russia has done, not only to our elections, but through cyber attacks against all parts of our infrastructure, either he doesn't understand it, or perhaps he is being blackmailed by Russia, because they may have compromising information about him.

"Or perhaps also you have a president who really does have strong authoritarian tendencies. And maybe he admires the kind of government that Putin is running in Russia. And I think all of that is a disgrace and a disservice to the American people. And we have got to make sure that Russia does not interfere, not only in our elections, but in other aspects of our lives."

These comments, which echo remarks he gave at a rally in Kansas late last week, signal Sanders' full embrace of the right-wing campaign launched by the Democrats and backed by dominant sections of the military-intelligence apparatus. Their opposition to Trump is centered on issues of foreign policy, based on the concern that Trump, due to his own "America First" brand of imperialist strategy, has run afoul of geostrategic imperatives that are considered inviolable -- in particular, the conflict with Russia.

Sanders did not use his time on a national television program to condemn Trump's persecution of immigrants and the separation of children from their parents, or to denounce his naming of ultra-right jurist Brett Kavanaugh to the Supreme Court, or to attack the White House declaration last week that the "war on poverty" had ended victoriously -- in order to justify the destruction of social programs for impoverished working people. Nor did he seek to advance his supposedly left-wing program on domestic issues like health care, jobs and education.

Sanders' embrace of the anti-Russia campaign is not surprising, but it is instructive. This is, after all, an individual who presented himself as "left-wing," even a "socialist." During the 2016 election campaign, he won the support of millions of people attracted to his call for a "political revolution" against the "billionaire class." For Sanders, who has a long history of opportunist and pro-imperialist politics in the orbit of the Democratic Party, the aim of the campaign was always to direct social discontent into establishment channels, culminating in his endorsement of the campaign of Hillary Clinton.

Sanders's support for the anti-Russia and anti-Wikileaks campaign is all the more telling because he was himself the victim of efforts by the Clinton campaign and the Democratic Party leadership to block his 2016 campaign. In June and July 2016, Wikileaks published internal Democratic emails in which officials ridiculed the Sanders campaign, forcing the DNC to issue a public apology: "On behalf of everyone at the DNC, we want to offer a deep and sincere apology to Senator Sanders, his supporters, and the entire Democratic Party for the inexcusable remarks made over email."

In the aftermath of his election campaign, Sanders was elevated into a top-level position in the Democratic Party caucus in the US Senate. His first response to the inauguration of Trump was to declare his willingness to "work with" the president, closely tracking remarks of Obama that the election of Trump was part of an "intramural scrimmage" in which all sides were on the same team. As the campaign of the military-intelligence agencies intensifies, however, Sanders is toeing the line.

The experience is instructive not only in relation to Sanders, but to an entire social milieu and the political perspective with which it is associated. This is what it means to work within the Democratic Party. The Sanders campaign did not push the Democrats to the left, but rather the state apparatus of the ruling class brought Sanders in to give a "left" veneer to a thoroughly right-wing party.

New political figures, many associated with the Democratic Socialists of America (DSA) are being brought in for the same purpose. As Sanders gave his anti-Russia rant, Alexandria Ocasio-Cortez sat next to him nodding her agreement. The 28-year-old member of the DSA last month won the Democratic nomination in New York's 14th Congressional District, unseating the Democratic incumbent, Joseph Crowley, the fourth-ranking member of the Democratic leadership in the House of Representatives.

Since then, Ocasio-Cortez has been given massive and largely uncritical publicity by the corporate media, summed up in an editorial puff piece by the New York Times that described her as "a bright light in the Democratic Party who has brought desperately needed energy back to New York politics "

Ocasio-Cortez and Sanders were jointly interviewed from Kansas, where the two appeared Friday at a campaign rally for James Thompson, who is seeking the Democratic nomination for the US House of Representatives from the Fourth Congressional District, based in Wichita, in an August 7 primary election.

Thompson might appear to be an unusual ally for the "socialist" Sanders and the DSA member Ocasio-Cortez. His campaign celebrates his role as an Army veteran, and his website opens under the slogan "Join the Thompson Army," followed by pledges that the candidate will "Fight for America." In an interview with the Associated Press, Thompson indicated that despite his support for Sanders' call for "Medicare for all," and his own endorsement by the DSA, he was wary of any association with socialism. "I don't like the term socialist, because people do associate that with bad things in history," he said.

Such anticommunism fits right in with the anti-Russian campaign, which is the principal theme of the Democratic Party in the 2018 elections. As the World Socialist Web Site has pointed out for many months, the real thrust of the Democratic Party campaign is demonstrated by its recruitment as congressional candidates of dozens of former CIA and military intelligence agents, combat commanders from the wars in Iraq and Afghanistan, and war planners from the Pentagon, State Department and White House.

There is no contradiction between the influx of military-intelligence candidates into the Democratic Party and the Democrats' making use of the services of Sanders and Ocasio-Cortez to give the party a "left" cover. Both the CIA Democrats and their pseudo-left "comrades" agree on the most important questions: the defense of the global interests of American imperialism and a more aggressive intervention in the Syrian civil war and other areas where Washington and Moscow are in conflict.

[Jul 23, 2018] The Democratic Party's Pitch to Billionaires by Eric Zuesse

Notable quotes:
"... The wing of the Democratic Party that looks for the dollars instead of the votes is called "The Third Way" and it presents itself as representing the supposedly vast political center, nothing "extremist" or "marginal." But didn't liberal Republicanism go out when Nelson Rockefeller did? Conservative Democrats are like liberal Republicans -- they attract flies and billionaires, but not many votes. And didn't the Rockefeller drug laws fill our prisons with millions of pathetic drug-users and small drug-dealers but not with the kingpins in either the narcotics business or the bankster rackets (such as had crashed the economy in 2008 -- and the Third Way Democrat who had been the exceptional politician and liar that was so slick he actually did attract many votes, President Barack Obama, told the banksters privately, on 27 March 2009, "I'm not out there to go after you. I'm protecting you." And, he did keep his promise to them, though not to his voters .) ..."
"... They want another Barack Obama. There aren't any more of those (unless, perhaps, Michelle Obama enters the contest). But, even if there were: How many Democrats would fall for that scam, yet again -- after the disaster of 2016? ..."
"... Maybe the Third Way is right, and there's a sucker born every minute. But if that's what the Democratic Party is going to rely upon, then America's stunningly low voter-participation rate is set to plunge even lower, because even more voters than before will either be leaving the Presidential line blank, or even perhaps voting for the Republican candidate (as some felt driven to do in 2016). ..."
"... Investigative historian Eric Zuesse is the author, most recently, of They're Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010 , and of CHRIST'S VENTRILOQUISTS: The Event that Created Christianity . He is a frequent contributor to Global Research. ..."
Jul 23, 2018 | www.globalresearch.ca

The wing of the Democratic Party that looks for the dollars instead of the votes is called "The Third Way" and it presents itself as representing the supposedly vast political center, nothing "extremist" or "marginal." But didn't liberal Republicanism go out when Nelson Rockefeller did? Conservative Democrats are like liberal Republicans -- they attract flies and billionaires, but not many votes. And didn't the Rockefeller drug laws fill our prisons with millions of pathetic drug-users and small drug-dealers but not with the kingpins in either the narcotics business or the bankster rackets (such as had crashed the economy in 2008 -- and the Third Way Democrat who had been the exceptional politician and liar that was so slick he actually did attract many votes, President Barack Obama, told the banksters privately, on 27 March 2009, "I'm not out there to go after you. I'm protecting you." And, he did keep his promise to them, though not to his voters .)

They're at it, yet again. On July 22nd, NBC News's Alex Seitz-Wald headlined "Sanders' wing of the party terrifies moderate Dems. Here's how they plan to stop it." And he described what was publicly available from the 3-day private meeting in Columbus Ohio of The Third Way, July 18-20, the planning conference between the Party's chiefs and its billionaires. Evidently, they hate Bernie Sanders and are already scheming and spending in order to block him, now a second time, from obtaining the Party's Presidential nomination. "Anxiety has largely been kept to a whisper among the party's moderates and big donors, with some of the major fundraisers pressing operatives on what can be done to stop the Vermonter if he runs for the White House again." This passage in Seitz-Wald's article was especially striking to me:

The gathering here was an effort to offer an attractive alternative to the rising Sanders-style populist left in the upcoming presidential race. Where progressives see a rare opportunity to capitalize on an energized Democratic base, moderates see a better chance to win over Republicans turned off by Trump.

The fact that a billionaire real estate developer, Winston Fisher, cohosted the event and addressed attendees twice, underscored that this group is not interested in the class warfare vilifying the "millionaires and billionaires" found in Sanders' stump speech.

"You're not going to make me hate somebody just because they're rich. I want to be rich!" Rep. Tim Ryan, D-Ohio, a potential presidential candidate, said Friday to laughs.

I would reply to congressman Ryan's remark: If you want to be rich, then get the hell out of politics! Don't run for President! I don't want you there! And that's no joke!

Anyone who doesn't recognize that an inevitable trade-off exists between serving the public and serving oneself, is a libertarian -- an Ayn Rander, in fact -- and there aren't many of those in the Democratic Party, but plenty of them are in the Republican Party.

Just as a clergyman in some faiths is supposed to take a vow of chastity, and in some faiths also to take a vow of poverty, in order to serve "the calling" instead of oneself, anyone who enters 'public service' and who aspires to "be rich" is inevitably inviting corruption -- not prepared to do war against it . That kind of politician is a Manchurian candidate, like Obama perhaps, but certainly not what this or any country needs, in any case. Voters like that can be won only by means of deceit, which is the way that politicians like that do win.

No decent political leader enters or stays in politics in order to "be rich," because no political leader can be decent who isn't in it as a calling, to public service, and as a repudiation, of any self-service in politics.

Republican Party voters invite corrupt government, because their Party's ideology is committed to it ("Freedom [for the rich]!"); but the only Democratic Party voters who at all tolerate corrupt politicians (such as Governor Andrew Cuomo in New York State) are actually Republican Democrats -- people who are confused enough so as not really to care much about what they believe; whatever their garbage happens to be, they believe in it and don't want to know differently than it.

The Third Way is hoping that there are enough of such 'Democrats' so that they can, yet again, end up with a Third Way Democrat being offered to that Party's voters in 2020, just like happened in 2016. They want another Barack Obama. There aren't any more of those (unless, perhaps, Michelle Obama enters the contest). But, even if there were: How many Democrats would fall for that scam, yet again -- after the disaster of 2016?

Maybe the Third Way is right, and there's a sucker born every minute. But if that's what the Democratic Party is going to rely upon, then America's stunningly low voter-participation rate is set to plunge even lower, because even more voters than before will either be leaving the Presidential line blank, or even perhaps voting for the Republican candidate (as some felt driven to do in 2016).

The Third Way is the way to the death of democracy, if it's not already dead . It is no answer to anything, except to the desires of billionaires -- both Republican and Democratic.

The center of American politics isn't the center of America's aristocracy. The goal of groups such as The Third Way is to fool the American public to equate the two. The result of such groups is the contempt that America's public have for America's Government . But, pushed too far, mass disillusionment becomes revolution. Is that what America's billionaires are willing to risk? They might get it.

*

Investigative historian Eric Zuesse is the author, most recently, of They're Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010 , and of CHRIST'S VENTRILOQUISTS: The Event that Created Christianity . He is a frequent contributor to Global Research.

[Jun 24, 2018] Was the Marketplace of Ideas Politically Hijacked -

Notable quotes:
"... A Stigler Center panel examines the influence of Big Five tech firms over political discourse and the marketplace of ideas. ..."
"... "Our country has allowed the concentration of power in giant intermediaries -- Google, Facebook, and Amazon -- vastly more powerful than the original intermediary which we fought, which was the British East India Company." ..."
"... "We have reporters, editors, and publishers of our newspapers who live in fear every day. This is true of the people who publish our books and who write our books. They live in fear [that] Amazon is going to shut them down. Whose fault is that? It's the people in the antitrust community." ..."
"... "Google not only vanquished competition. What it did is it vanquished the antitrust enforcers who are supposed to protect the process of competition." ..."
"... "Basically, Section 230 was a libertarian's dream. They got what they wanted. I am a limited government conservative. What they wanted was a no-government world." ..."
Jun 24, 2018 | promarket.org

Was the Marketplace of Ideas "Politically Hijacked"? Posted on June 21, 2018 by Asher Schechter

A Stigler Center panel examines the influence of Big Five tech firms over political discourse and the marketplace of ideas.

https://www.youtube.com/embed/c0E15ka446M

At one point during Mark Zuckerberg's Senate hearing in April , the Facebook CEO had the following peculiar exchange with Senator Lindsay Graham (R-SC):

Graham: But you, as a company, welcome regulation?

Zuckerberg: I think, if it's the right regulation, then yes.

Graham: You think the Europeans had it right?

Zuckerberg: I think that they get things right.

Graham: . So would you work with us in terms of what regulations you think are necessary in your industry?

Zuckerberg: Absolutely.

Graham: Okay. Would you submit to us some proposed regulations?

Zuckerberg: Yes. And I'll have my team follow up with you so, that way, we can have this discussion across the different categories where I think that this discussion needs to happen.

Graham: Look forward to it.

This telling bit of dialogue was part of an overall pattern: the hearing was meant to hold Facebook (and Zuckerberg himself, as the company's founder, CEO, and de facto single ruler ) accountable for the mishandling of millions of people's private data. Yet one after another , the senators were asking an evasive Zuckerberg if he would be willing to endorse their bills and proposals to regulate Facebook. This mode of questioning repeated itself (to a somewhat lesser extent) during the House's tougher questioning of Zuckerberg the following day.

Needless to say, most company CEOs grilled by Congress following a major scandal that impacts millions of people and possibly the very nature of American democracy are not usually treated in this way -- as private regulators almost on equal footing with Congress.

Facebook, however, is not a typical company. As a recent Vox piece noted, with its vast reach of more than two billion users worldwide, Facebook is more akin to a government or a "powerful sovereign," with Zuckerberg -- due to his unusual level of control over it -- being the "key lawgiver." Zuckerberg acknowledged as much himself when he said, in a much-quoted moment of candor , that "in a lot of ways Facebook is more like a government than a traditional company." More than other technology companies, he added, Facebook is "really setting policies."

The notion that corporations can become so powerful that they are able to act as a "form of private government" (to quote Zephyr Teachout ) has long been part of the antitrust literature. Indeed, as the Open Market Institute's Barry Lynn and Matt Stoller recently noted during a panel at the Stigler Center's Digital Platforms and Concentration antitrust conference, it is deeply rooted in the rich tradition of antimonopoly in America.

That digital platforms are major political players has also been well documented . Once disdainful of politics, in the past two years Google, Facebook, and Amazon have dramatically ramped up their lobbying efforts, as the public and media backlash against their social, economic, and political power intensified. Google, which enjoyed unprecedented access to the Obama White House, is now the biggest lobbyist in Washington, with other tech platforms not far behind.

Market power begetting political power is not new in itself. As the participants of the Stigler panel noted, it is the immense power that concentrated digital intermediaries like Google and Facebook wield over digital markets, human interaction and the marketplace of ideas, particularly when it comes to the distribution of political information, that presents a unique challenge. As Lina Khan (also of Open Markets) recently noted , the current landscape of Internet media is one in which a handful of companies "are basically acting as private regulators, as private governments, over the dissemination and organization of information in a way that is totally unchecked by the public."

The latter part, at least, seems to be changing rapidly, as Americans (and millions more worldwide) grapple with ongoing revelations showing the profound impact that digital monopolies have on political opinions and outcomes, in the US and across the world. As Congressman John Sarbanes (D-MD) said during Zuckerberg's House hearing in April: "Facebook is becoming a self-regulated superstructure for political discourse."

Left to right: Scott Cleland, Ellen Goodman, Matt Stoller, Barry Lynn, Guy Rolnik

The exact nature of tech platforms' political power, its roots, and how to best deal with it -- all questions debated during the Stigler Center panel -- are complex and varied. But the key question seems rather simple. As Sarbanes put it during the same Congressional hearing: "Are we, the people, going to regulate our political dialogue, or are you, Mark Zuckerberg, going to end up regulating the political discourse? ״

A Private Regulator of Speech

Facebook, said Rutgers Law School professor Ellen Goodman, operates as a private speech regulator. As such, much like public governments, it "privileges some [forms of] speech over others." Unlike governments, however, which as regulators of speech purport to support public good, Facebook has adopted a "First Amendment-like radical libertarianism" through which it has so far refused to differentiate between "high- and low-quality information, truth or falsity, responsible and irresponsible press."

Facebook, famously, argues that it is not a media company, but a technology company. "It's not a player, it's not a [referee], it's just the engineer who made the field," said Goodman, the co-director of the Rutgers Institute for Information Policy & Law. The purpose of Facebook's "First Amendment rhetoric," she noted, is "to maximize data flow on its platform," but by doing so, "it implies, or even says explicitly, that it's standing in the shoes of the government."

Facebook and other platforms, said Goodman, have benefited from the process of deregulation and budget cuts to public media -- a process that has predated the Internet, and led to Washington essentially "giving up" on media policy. The government effectively "exempted these platforms from the kind of ordinary regulation that other information intermediaries were subjected to." With "platforms in the shoes of government, [and] government out of media policy," the concentration of platform power over information flows was allowed to continue undisturbed.

The problem, however, is that much like fellow FAANGs Amazon and Google, Facebook is not just an impartial governor, but a market participant interested in "monopolizing the time of its users," with a strong incentive to privilege its own products and business model that "eviscerates journalism."

"It also tunes its algorithm to favor certain kinds of speech and certain speakers," added Goodman. "There's almost no transparency, save for what it selectively, elliptically, and sometimes misleadingly posts on its blog."

"People Live in Fear"

In a seminal 1979 essay on what he termed the "political content" of antitrust, former FTC chairman Robert Pitofsky argued that "political values," such as "the fear that excessive concentration of economic power will foster anti-democratic political pressures," should be incorporated into antitrust enforcement. In recent years, this view has been echoed by a growing number of antitrust scholars , who argue that the way antitrust enforcement has been conducted in the US for the past 40 years -- solely through the prism of "consumer welfare" -- is ill equipped to deal with the new threats posed by digital platforms.

The Unites States, remarked Lynn during the panel, was born "out of rebellion against concentrated power, the British East India Company." The original purpose of antimonopoly in America, said Lynn, was the protection of personal liberty from concentrated economic and political power: "to give everybody the ability to manage their own property in the ways that they see fit, manage their own lives in the way that they see fit. To be truly independent of everybody else. To not be anybody else's puppet." Liberty and democracy, he added, "are functions of antimonopoly."

A state in which Facebook and Google wield enormous influence over the flow of information -- where, to quote a recent piece by Wired 's Nicholas Thompson and Fred Vogelstein, "every publisher knows that, at best, they are sharecroppers on Facebook's massive industrial farm" -- is antithetical to this ethos, said Lynn, and is firmly rooted in the "absolute, complete failure" of antitrust in the United States. "Our country has allowed the concentration of power in giant intermediaries -- Google, Facebook, and Amazon -- vastly more powerful than the original intermediary which we fought, which was the British East India Company." These digital intermediaries, he added, are "using their power in ways that are directly threatening our most fundamental liberties and our democracy."

"Our country has allowed the concentration of power in giant intermediaries -- Google, Facebook, and Amazon -- vastly more powerful than the original intermediary which we fought, which was the British East India Company."

The blame for the outsize influence that Facebook and other digital platforms have over the political discourse, said Lynn, rests squarely on the shoulders of the antitrust community: "For 200 years in this country, antimonopoly was designed to create freedom from masters. In 1981, when we got rid of our traditional antimonopoly and replaced it with consumer welfare, we created a system that has given freedom to master."

In today's concentrated media landscape, he contended, "people live in fear. We have reporters, editors, and publishers of our newspapers who live in fear every day. This is true of the people who publish our books and who write our books. They live in fear [that] Amazon is going to shut them down. Whose fault is that? It's the people in the antitrust community."

"We have reporters, editors, and publishers of our newspapers who live in fear every day. This is true of the people who publish our books and who write our books. They live in fear [that] Amazon is going to shut them down. Whose fault is that? It's the people in the antitrust community."

Lynn went on to quote from Thompson and Vogelstein's Wired piece: "The social network is roughly 200 times more valuable than the Times . And journalists know that the man who owns the farm has the leverage. If Facebook wanted to, it could quietly turn any number of dials that would harm a publisher -- by manipulating its traffic, its ad network, or its readers."

"This was hidden in the middle of the article," said Lynn. "[Thompson], as a journalist, felt obliged to put this out there He was crying out to the people in this community, in the antitrust community. He's saying 'protect me, the publisher, the editor of this magazine. Protect me, the reporter. Please make sure that I have the independence to do my work.'"

The "Code of Silence" Has Been Broken

Recent changes to Facebook's newsfeed have caused referral traffic from Facebook to media companies' websites to sharply decline , once again raising concerns about the significant impact that the company has on the media industry. The satirical news site The Onion , for instance, has launched a public war against Facebook, calling it "an unwanted interloper between The Onion and our audience." "We have 6,572,949 followers on Facebook who receive an ever-decreasing amount of the content we publish on the network," the site's editor-in-chief, Chad Nackers, told Business Insider .

The backlash by major news outlets and politicians across the political spectrum against the power of Facebook and other tech platforms as de facto regulators of speech on the Internet is a new phenomenon, said Guy Rolnik, a Clinical Associate Professor for Strategic Management at the University of Chicago Booth school of Business, during the panel. Until not too long ago, he said, Internet monopolies were the "darlings of the news media." Less than a year ago , he noted, Zuckerberg was even touted by several media outlets as a viable presidential candidate. "The idea that a person who has unprecedented private control over personal data and the public discourse at large would also be the president of the United States was totally in the realm and perimeter of what is legitimate," he said.

What has changed? "In many ways, what has changed is that many people associate Facebook today with the election of Donald Trump. This is why we see so much focus on those issues that were very salient and important for years," Rolnik maintained. Trump's election, and Facebook's role in the lead-up to it, broke the "code of silence."

Nevertheless, newsrooms today, he said, still do everything in their power "to make sure that everything is shareable on Facebook." In the words of Thompson and Vogelstein, they are still "sharecroppers on Facebook's massive industrial farm."

Google has "Politically Hijacked the US Antitrust Enforcement Process"

Scott Cleland, president of the consultancy firm Precursor LLC and former deputy US coordinator for international communications and information policy in the George HW Bush administration, has long warned that concentration among digital platforms will negatively impact the US economy and society at large.

In 2007, Cleland testified before the Senate on the then-proposed Google-DoubleClick merger, calling upon antitrust enforcers to block the merger and warning that lax antitrust enforcement (of the kind that ultimately led the Google-DoubleClick merger to be approved) would allow Google to become the "ultimate Internet gatekeeper" and the "online-advertising bottleneck provider picking content winners and losers" -- both of which came true. In 2011, he published the book Search & Destroy: Why You Can't Trust Google Inc . , in which he warned readers of Google's surveillance-based business model and its "unprecedented centralization of power over the world's information."

During the conference, Cleland presented a new white paper entitled " Rejecting the Google School of No-Antitrust: Fake Consumer Welfare Standard " in which he argues that Alphabet/Google has "politically hijacked the US antitrust enforcement process from 2013 to 2018."

US antitrust enforcers, he said, were initially "very tough" on Google during the first years of the George W. Bush administration. Between 2008 and 2012, both the Bush II and Obama administrations brought "strong and consistent antitrust scrutiny and enforcement to Google." Then, in 2013, the Federal Trade Commission decided to drop its case against the company, despite the conclusion of its staff that Google had used anticompetitive tactics. Following Obama's reelection, which Google at the time was credited with delivering, antitrust enforcement against Big Tech firms essentially ceased. "They shut down all those investigations and they did nothing for the last five years. DOJ went from very active -- four or five major antitrust actions -- to nothing. Crickets."

Back then, Google and Facebook were still "fiercely competing," he said. Google was going after Facebook's territory with Google Plus, and Facebook countered by going after Google search with Yahoo and Bing. But then, in 2014, something happened: the large tech firms "mysteriously stopped competing."

"Yahoo returned to working with Google. Apple dropped Bing for Siri and moved to Google search. Apple and Microsoft dropped their patent suits, and then Microsoft and Google made peace after scratching each other's eyes out. Google went from 70 percent share of search and search advertising in the PC market to 95 percent of that in both of those markets today," said Cleland.

What happened? Cleland points to the what he calls the "Google School of No-Antitrust," a narrative with which according to him Google had been trying to "influence public opinion, the media, elected and government officials, and US and state antitrust enforcers, to make the public believe Google (and other Internet platforms) have no antitrust risk or liability, because they offer free innovative products and services, and to make conservatives believe that the Google School of No-Antitrust and the Chicago School's consumer welfare standard and application are the same, when they are not."

Google, he asserted, "not only vanquished competition. What it did is it vanquished the antitrust enforcers who are supposed to protect the process of competition." It did so, he argued, by "politically hijacking the most important market, which is information."

"Google not only vanquished competition. What it did is it vanquished the antitrust enforcers who are supposed to protect the process of competition."

Cleland, who identifies as a free market conservative, argued that the current Internet is far from a free market. "Who thinks it's a good idea that all of the world's information goes through one bottleneck?" he asked, adding that "all the bad things that you're seeing right now are the result of policy."

One such policy is Section 230 of the Communications Decency Act of 1996, which provided Internet companies with legal immunity for the content their users generated or shared and is often credited with enabling the creation of the Internet as we know it today. Cleland sees Section 230 as "market structuring" and has compared it to the libertarian concept of creating artificial islands outside any governmental territory, known as " seasteading ."

"Section 230 says -- I'm paraphrasing, but that's what it says -- that US policy recognizes that the Internet is a free market that should be unfettered by federal and state regulations," said Cleland. "Basically, Section 230 was a libertarian's dream. They got what they wanted. I am a limited government conservative. What they wanted was a no-government world."

"Basically, Section 230 was a libertarian's dream. They got what they wanted. I am a limited government conservative. What they wanted was a no-government world."

Much of today's problems regarding the conduct of digital platforms, he said, results from this policy. "Twenty-two years ago, we as a nation immunized all interactive computer services from any civil liability. We said, 'It is OK. There is no accountability, no responsibility for you looking the other way, when your platform or things that are going on on your platform harm others.'"

Section 230, he maintained, "basically created 21 st -century robber barons. Those guys know they have the full weight of the government. If they go to court, they're going to win, and they have almost all the time."

Antitrust Is "One Part of the Answer"

When it comes to addressing these threats to free speech and democratic discourse, said Goodman, antitrust is only "one part of the answer." The other part, she asserted, is regulation.

"The First Amendment that we have, that we know and love today," she said, "was not born in 1789 in Philadelphia. It developed in the latter part of the 20th century against a particular set of industrial and social practices that mitigated some of the costs of free speech and spread the benefits."

Lawmakers and policymakers, she argued, should "retrieve and resuscitate the vocabulary of media policy," focusing on three core values: "freedom of mind and autonomy; non-market values of diversity and localism/community; and a concept of the public interest and fiduciary responsibility."

Whenever someone makes an argument for using antitrust or regulation as a way to structure markets of information, Stoller cautioned, there are those who will argue that this amounts to censorship. When asked how to avoid censorship when discussing the use government power over speech, Goodman was conflicted: "There is no way around that. There's a real tension here between absolute liberty of speech and controls on speech," she said. We cannot have this whole conference with us fantasizing about various regulatory possibilities that involve use restrictions -- limits on the flow of data, limits on the collection of data -- without acknowledging that under our First Amendment doctrine right now, probably none of that passes muster."

However, Goodman pointed to the Northwest Ordinance as a possible roadmap. "Nobody would say, or maybe they did, that [the Northwest Ordinance ] was an anti-private property rule. It was structuring the market so that more people could own property. That's what the history of media regulation in this country has been: structuring speech markets so that more people can speak."

Disclaimer: The ProMarket blog is dedicated to discussing how competition tends to be subverted by special interests. The posts represent the opinions of their writers, not necessarily those of the University of Chicago, the Booth School of Business, or its faculty. For more information, please visit ProMarket Blog Policy .

[May 23, 2018] 2016 Hillary fiasco post mortem by Lambert Strether

Notable quotes:
"... Chasing Hillary ..."
"... As one person who had talked to Clinton about the difference between Trump and Sanders crowds recounted, her feeling was that 'at least white supremacists shaved.'" ..."
"... Why does Trump get away with corruption? Because Bill and Hillary Clinton normalized it ..."
May 23, 2018 | www.nakedcapitalism.com

"Clinton to be honored at Harvard for 'transformative impact'" [ The Hill ]. Irony is not dead.

"From the Jaws of Victory" [ Jacobin ]. Some highlights from Amy Chozick's Chasing Hillary , which really does sound like a fun read:

"In the public's mind, Clinton's 'deplorables' quip is remembered as evidence of her disdain for much of Trump's fan base. But there was one other group Clinton had a similar dislike of: Bernie Sanders supporters.

As one person who had talked to Clinton about the difference between Trump and Sanders crowds recounted, her feeling was that 'at least white supremacists shaved.'"

UPDATE "Why does Trump get away with corruption? Because Bill and Hillary Clinton normalized it" [Josh Barro, Business Insider ].

[May 03, 2018] Alert The Clintonian empire is still here and tries to steal the popular vote throug

Highly recommended!
The dramatic rise fo the number of CIA-democrats as candidates from Democratic Party is not assedental. As regular clintonites are discredited those guys can still appeal to patriotism to get elected.
Notable quotes:
"... Bernie continuously forcing Hillary to appear apologetic about her campaign funding from big financial interests. She tries hard to persuade the public that she will not serve specific interests. Her anxiety can be identified in many cases and it was very clear at the moment when she accused Bernie of attacking her, concerning this funding. Hillary was forced to respond with a deeply irrational argument: anyone who takes money from big interests doesn't mean that he/she will vote for policies in favor of these interests! ..."
"... Bernie drives the discussion towards fundamental ideological issues. He forced Hillary to defend her "progressiveness". She was forced to speak even about economic interests by names. A few years ago, this would be nearly a taboo in any debate between any primaries. ..."
"... After the disastrous defeat by Trump in 2016 election, the corporate Democrats realized that the progressive movement, supported mostly by the American youth, would not retreat and vanish. On the contrary, Bernie Sanders' popularity still goes up and there is a wave of progressive candidates who appear to be a real threat to the DNC establishment and the Clintonian empire. ..."
"... It seems that the empire has upgraded its dirty tactics beyond Hillary's false relocation to the Left. Seeing the big threat from the real progressives, the empire seeks to "plant" its own agents, masked as progressives, inside the electoral process, to disorientate voters and steal the popular vote. ..."
"... This is a Master's class in blatant historical revisionism and outright dishonesty. Beals was not a soldier unwillingly drafted into service, but an intelligence officer who voluntarily accepted an influential and critically important post for the Bush Administration in its ever-expanding crime against humanity in Iraq. ..."
May 03, 2018 | failedevolution.blogspot.gr

Beware of wolves in sheep's clothing

globinfo freexchange

During the 2016 Democratic party primaries we wrote that what Bernie achieved, is to bring back the real political discussion in America, at least concerning the Democratic camp. Bernie smartly "drags" his primary rival, Hillary Clinton, into the heart of the politics. Up until a few years ago, you could not observe too much difference between the Democrats and the Republicans, who were just following the pro-establishment "politics as usual", probably with a few, occasional exceptions. The "politics as usual" so far, was "you can't touch the Wall Street", for example.

Bernie continuously forcing Hillary to appear apologetic about her campaign funding from big financial interests. She tries hard to persuade the public that she will not serve specific interests. Her anxiety can be identified in many cases and it was very clear at the moment when she accused Bernie of attacking her, concerning this funding. Hillary was forced to respond with a deeply irrational argument: anyone who takes money from big interests doesn't mean that he/she will vote for policies in favor of these interests!

Bernie drives the discussion towards fundamental ideological issues. He forced Hillary to defend her "progressiveness". She was forced to speak even about economic interests by names. A few years ago, this would be nearly a taboo in any debate between any primaries.

After the disastrous defeat by Trump in 2016 election, the corporate Democrats realized that the progressive movement, supported mostly by the American youth, would not retreat and vanish. On the contrary, Bernie Sanders' popularity still goes up and there is a wave of progressive candidates who appear to be a real threat to the DNC establishment and the Clintonian empire.

It seems that the empire has upgraded its dirty tactics beyond Hillary's false relocation to the Left. Seeing the big threat from the real progressives, the empire seeks to "plant" its own agents, masked as progressives, inside the electoral process, to disorientate voters and steal the popular vote.

Eric Draitser gives us valuable information for such a type of candidate. Key points:

One candidate currently generating some buzz in the race is Jeff Beals, a self-identified "Bernie democrat" whose campaign website homepage describes him as a " local teacher and former U.S. diplomat endorsed by the national organization of former Bernie Sanders staffers, the Justice Democrats. " And indeed, Beals centers his progressive bona fides to brand himself as one of the inheritors of the progressive torch lit by Sanders in 2016. A smart political move, to be sure. But is it true?

Beals describes himself as a "former U.S. diplomat," touting his expertise on international issues born of his experience overseas. In an email interview with CounterPunch, Beals describes his campaign as a " movement for diplomacy and peace in foreign affairs and an end to militarism my experience as a U.S. diplomat is what drives it and gives this movement such force. " OK, sounds good, a very progressive sounding answer. But what did Beals actually do during his time overseas?

By his own admission, Beals' overseas career began as an intelligence officer with the CIA. His fluency in Arabic and knowledge of the region made him an obvious choice to be an intelligence spook during the latter stages of the Clinton Administration.

Beals shrewdly attempts to portray himself as an opponent of neocon imperialism in Iraq. In his interview with CounterPunch, Beals argued that " The State Department was sidelined as the Bush administration and a neoconservative cabal plunged America into the tragic Iraq War. As a U.S. diplomat fluent in Arabic and posted in Jerusalem at the time, I was called over a year into the war to help our country find a way out. "

This is a Master's class in blatant historical revisionism and outright dishonesty. Beals was not a soldier unwillingly drafted into service, but an intelligence officer who voluntarily accepted an influential and critically important post for the Bush Administration in its ever-expanding crime against humanity in Iraq.

Moreover, no one who knows anything about the Iraq War could possibly swallow the tripe that CIA/State Department officials in Iraq were " looking to help our country find a way out " a year into the war. A year into the war, the bloodletting was only just beginning, and Halliburton, Exxon-Mobil, and the other corporate vultures had yet to fully exploit the country and make billions off it. So, unfortunately for Beals, the historical memory of the anti-war Left is not that short.

It is self-evident that Beals has a laundry list of things in his past that he must answer for. For those of us, especially Millennials, who cut our activist teeth demonstrating and organizing against the Iraq War, Beals' distortions about his role in Iraq go down like hemlock tea. But it is the associations Beals maintains today that really should give any progressive serious pause.

When asked by CounterPunch whether he has any connections to either Bernie Sanders and his surrogates or Hillary Clinton and hers, Beals responded by stating: " I am endorsed by Justice Democrats, a group of former Bernie Sanders staffers who are pledged to electing progressives nationwide. I am also endorsed for the Greene County chapter of the New York Progressive Action Network, formerly the Bernie Sanders network. My first hire was a former Sanders field coordinator who worked here in NY-19. "

However, conveniently missing from that response is the fact that Beals' campaign has been, and continues to be, directly managed in nearly every respect by Bennett Ratcliff, a longtime friend and ally of Hillary Clinton. Ratcliff is not mentioned in any publicly available documents as a campaign manager, though the most recent FEC filings show that as of April 1, 2018, Ratcliff was still on the payroll of the Beals campaign. And in the video of Beals' campaign kickoff rally, Ratcliff introduces Beals, while only being described as a member of the Onteora School Board in Ulster County . This is sort of like referring to Donald Trump as an avid golfer.

Beals has studiously, and rather intelligently, avoided mentioning Ratcliff, or the presence of Clinton's inner circle on his campaign. However, according to internal campaign documents and emails obtained by CounterPunch, Ratcliff manages nearly every aspect of the campaign, acting as a sort of éminence grise behind the artifice of a progressive campaign fronted by a highly educated and photogenic political novice.

By his own admission, Ratcliff's role on the campaign is strategy, message, and management. Sounds like a rather textbook description of a campaign manager. Indeed, Ratcliff has been intimately involved in "guiding" Beals on nearly every important campaign decision, especially those involving fundraising .

And it is in the realm of fundraising that Ratcliff really shines, but not in the way one would traditionally think. Rather than focusing on large donations and powerful interests, Ratcliff is using the Beals campaign as a laboratory for his strategy of winning elections without raising millions of dollars.

In fact, leaked campaign documents show that Ratcliff has explicitly instructed Beals and his staffers not to spend money on food, decorations, and other standard campaign expenses in hopes of presenting the illusion of a grassroots, people-powered campaign with no connections to big time donors or financial elites .

It seems that Ratcliff is the wizard behind the curtain, leveraging his decades of contact building and close ties to the Democratic Party establishment while at the same time manufacturing an astroturfed progressive campaign using a front man in Beals .

One of Ratcliff's most infamous, and indefensible, acts of fealty to the Clinton machine came in 2009 when he and longtime Clinton attorney and lobbyist, Lanny Davis, stumped around Washington to garner support for the illegal right-wing coup in Honduras, which ousted the democratically elected President Manuel Zelaya in favor of the right-wing oligarchs who control the country today. Although the UN, and even U.S. diplomats on the ground in Honduras, openly stated that the coup was illegal, Clinton was adamant to actively keep Zelaya out.

Essentially then, Ratcliff is a chief architect of the right-wing government in Honduras – the same government assassinating feminist and indigenous activists like Berta Cáceres, Margarita Murillo, and others, and forcibly displacing and ethnically cleansing Afro-indigenous communities to make way for Carribbean resorts and golf courses.

And this Washington insider lobbyist and apologist for war criminals and crimes against humanity is the guy who's on a crusade to reform campaign finance and fix Washington? This is the guy masquerading as a progressive? This is the guy working to elect an "anti-war progressive"?

In a twisted way it makes sense. Ratcliff has the blood of tens of thousands of Hondurans (among others) on his hands, while Beals is a creature of Langley, a CIA boy whose exceptional work in the service of Bush and Clinton administration war criminals is touted as some kind of merit badge on his resume.

What also becomes clear after establishing the Ratcliff-Beals connection is the fact that Ratcliff's purported concern with campaign financing and "taking back the Republic" is really just a pretext for attempting to provide a "proof of concept," as it were, that neoliberal Democrats shouldn't fear and subvert the progressive wing of the party, but rather that they should co-opt it with a phony grassroots facade all while maintaining links to U.S. intelligence, Wall Street, and the power brokers of the Democratic Party .

Info from the article How Clintonites Are Manufacturing Faux Progressive Congressional Campaigns by Eric Draitser

[Apr 30, 2018] Mueller s past is so laden with misfeasance and malfeasance that he should have been disbarred a few decades ago

Key figures on anti-trump color revolution including Mueller, Rosenstein and Comey are closely connected with Clinton foundation
Notable quotes:
"... Guess who took over this investigation in 2002? Bet you can't guess. No other than James Comey. ..."
"... Guess who ran the Tax Division inside the Department of Injustice from 2001 to 2005? No other than the Assistant Attorney General of the United States, Rod Rosenstein. ..."
"... Guess who was the Director of the Federal Bureau of Investigation during this time frame??? I know, it's a miracle, just a coincidence, just an anomaly in statistics and chances: Robert Mueller. ..."
"... Then of all surprises, in April 2016, James Comey drafts an exoneration letter of Hillary Rodham Clinton, meanwhile the DOJ is handing out immunity deals like candy on Halloween. ..."
"... The DOJ didn't even convene a Grand Jury. Like a lightning bolt of statistical impossibility, like a miracle from God himself, like the true "Gangsta" Homey is, James steps out into the cameras of an awaiting press conference on July the 8th of 2016 and exonerates the Hillary from any wrongdoing. ..."
"... It goes on and on, Rosenstein becomes Asst. Attorney General, Comey gets fired based upon a letter by Rosenstein, Comey leaks government information to the press, Mueller is assigned to the Russian Investigation witch hunt by Rosenstein to provide cover for decades of malfeasance within the FBI and DOJ and the story continues. ..."
Apr 30, 2018 | www.unz.com

NoseytheDuke , April 23, 2018 at 11:39 am GMT

@renfro

I'm on the other side of the planet but a friend in the Mid-West sent me this and I thought I'd ask if anyone else had seen it?

Is there corruption in DC?

From 2001 to 2005 there was an ongoing investigation into the Clinton Foundation. A Grand Jury had been empaneled. The investigation was triggered by the pardon of Marc Rich ..

Governments from around the world had donated to the "Charity". Yet, from 2001 to 2003 none of those "Donations" to the Clinton Foundation were declared.

Guess who took over this investigation in 2002? Bet you can't guess. No other than James Comey.

Guess who was transferred in to the Internal Revenue Service to run the Tax Exemption Branch of the IRS? Your friend and mine, Lois "Be on The Look Out" (BOLO) Lerner.

It gets better, well not really, but this is all just a series of strange coincidences, right?

Guess who ran the Tax Division inside the Department of Injustice from 2001 to 2005? No other than the Assistant Attorney General of the United States, Rod Rosenstein.

Guess who was the Director of the Federal Bureau of Investigation during this time frame??? I know, it's a miracle, just a coincidence, just an anomaly in statistics and chances: Robert Mueller.

What do all four casting characters have in common? They all were briefed and were front line investigators into the Clinton Foundation Investigation.

Now that's just a coincidence, right? Ok, lets chalk the last one up to mere chance.

Let's fast forward to 2009. James Comey leaves the Justice Department to go and cash-in at Lockheed Martin.

Hillary Clinton is running the State Department, on her own personal email server.

The Uranium One "issue" comes to the attention of the Hillary. Like all good public servants do, you know looking out for America's best interest, she decides to support the decision and approve the sale of 20% of US Uranium to no other than, the Russians.

Now you would think that this is a fairly straight up deal, except it wasn't, I question what did the People get out of it?? Oddly enough, prior to the sales approval, Bill Clinton goes to Moscow, gets paid 500K for a one-hour speech then meets with Vladimir Putin at his home for a few hours.

Ok, no big deal right? Well, not so fast, the FBI had a mole inside this scheme.

Guess who was the FBI Director during this time frame? Yep, Robert Mueller. He requested the State Department allow himself to deliver a Uranium Sample to Moscow in 2009, under the guise of a "sting" operation -- (see leaked secret cable 09STATE38943).. while it is never clear if Mueller did deliver the sample, the "implication" is there ..

Guess who was handling that case within the Justice Department out of the US Attorney's Office in Maryland ?? No other than, Rod Rosenstein.

Remember the "informant" inside the FBI -- - Guess what happened to the informant? Department of Justice placed a GAG order on him and threatened to lock him up if he spoke about the Uranium Deal. Personally, I have to question how does 20% of the most strategic asset of the United States of America end up in Russian hands??? The FBI had an informant, a mole providing inside information to the FBI on the criminal enterprise and NOTHING happens, except to the informant -- Strange !!

Guess what happened soon after the sale was approved? 145 million dollars in "donations" made their way into the Clinton Foundation from entities directly connected to the Uranium One deal.

Guess who was still at the Internal Revenue Service working the Charitable Division?

No other than, Lois Lerner. Ok, that's all just another series of coincidences, nothing to see here, right? Let's fast forward to 2015.

Due to a series of tragic events in Benghazi and after the nine "investigations" the House, Senate and at State Department, Trey Gowdy who was running the 10th investigation as Chairman of the Select Committee on Benghazi, discovers that the Hillary ran the State Department on an unclassified, unauthorized, outlaw personal email server.

He also discovered that none of those emails had been turned over when she departed her "Public Service" as Secretary of State which was required by law.

He also discovered that there was Top Secret information contained within her personally archived email. Sparing you the State Departments cover up, the nostrums they floated, the delay tactics that were employed and the outright lies that were spewed forth from the necks of the Kerry State Department, they did everything humanly possible to cover for Hillary.

Guess who became FBI Director in 2013? Guess who secured 17 no bid contracts for his employer (Lockheed Martin) with the State Department and was rewarded with a six million dollar thank you present when he departed his employer. No other than James Comey. Folks if I did this when I worked for the government, I would have been locked up -- The State Department didn't even comply with the EEO and small business requirements the government places on all Request For Proposals (RFP) on contracts -- It amazes me how all those no-bids just went right through at State -- simply amazing and no Inspector General investigation !!

Next after leaving the private sector Comey is the FBI Director in charge of the "Clinton Email Investigation" after of course his FBI Investigates the Lois Lerner "Matter" at the Internal Revenue Service and exonerates her. Nope couldn't find any crimes there. Nothing here to report --

Then of all surprises, in April 2016, James Comey drafts an exoneration letter of Hillary Rodham Clinton, meanwhile the DOJ is handing out immunity deals like candy on Halloween.

The DOJ didn't even convene a Grand Jury. Like a lightning bolt of statistical impossibility, like a miracle from God himself, like the true "Gangsta" Homey is, James steps out into the cameras of an awaiting press conference on July the 8th of 2016 and exonerates the Hillary from any wrongdoing. As I've said many times, July 8, 2016 is the date that will live in infamy of the American Justice System ..

Can you see the pattern?

It goes on and on, Rosenstein becomes Asst. Attorney General, Comey gets fired based upon a letter by Rosenstein, Comey leaks government information to the press, Mueller is assigned to the Russian Investigation witch hunt by Rosenstein to provide cover for decades of malfeasance within the FBI and DOJ and the story continues.

FISA Abuse, political espionage .. pick a crime, any crime, chances are this group and a few others did it. All the same players. All compromised and conflicted. All working fervently to NOT go to jail themselves. All connected in one way or another to the Clinton's. They are like battery acid, they corrode and corrupt everything they touch. How many lives have the Clinton's destroyed?

As of this writing, the Clinton Foundation, in its 20+ years of operation of being the largest International Charity Fraud in the history of mankind, has never been audited by the Internal Revenue Service.

Let us not forget that Comey's brother works for DLA Piper, the law firm that does the Clinton Foundation's taxes.

Twodees Partain , April 23, 2018 at 10:23 pm GMT
@NoseytheDuke

More on Mueller for renfro, who seems to think that Mueller has some kind of integrity hidden somewhere:

http://themillenniumreport.com/2017/05/robert-mueller-the-old-fixer-is-back-in-town/

[Apr 21, 2018] On the Criminal Referral of Comey, Clinton et al by Ray McGovern

Highly recommended!
Notable quotes:
"... Putting aside his partisan motivations, House Intelligence Committee Chair Devin Nunes (R-CA) was unusually blunt two months ago in warning of legal consequences for officials who misled the Foreign Intelligence Surveillance Court in order to enable surveillance on Trump and his associates. Nunes's words are likely to have sent chills down the spine of those with lots to hide: "If they need to be put on trial, we will put them on trial," he said ."The reason Congress exists is to oversee these agencies that we created." ..."
"... The media will be key to whether this Constitutional issue is resolved. Largely because of Trump's own well earned reputation for lying, most Americans are susceptible to slanted headlines like this recent one -- "Trump escalates attacks on FBI " -- from an article in The Washington Post , commiserating with the treatment accorded fired-before-retired prevaricator McCabe and the FBI he ( dis)served . ..."
"... What motivated the characters now criminally "referred" is clear enough from a wide variety of sources, including the text messages exchange between Strzok and Page. Many, however, have been unable to understand how these law enforcement officials thought they could get away with taking such major liberties with the law. ..."
"... None of the leaking, unmasking, surveillance, "opposition research," or other activities directed against the Trump campaign can be properly understood, if one does not bear in mind that it was considered a sure thing that Secretary Clinton would become President, at which point illegal and extralegal activities undertaken to help her win would garner praise, not prison. The activities were hardly considered high-risk, because candidate Clinton was sure to win. ..."
"... Comey admits, "It is entirely possible that, because I was making decisions in an environment where Hillary Clinton was sure to be the next president, my concern about making her an illegitimate president by concealing the re-started investigation bore greater weight than it would have if the election appeared closer or if Donald Trump were ahead in the polls." ..."
"... The key point is not Comey's tortured reasoning, but rather that Clinton was "sure to be the next president." This would, of course, confer automatic immunity on those now criminally referred to the Department of Justice. Ah, the best laid plans of mice and men -- even very tall men. One wag claimed that the "Higher" in "A Higher Loyalty" refers simply to the very tall body that houses an outsized ego. ..."
"... "Hope springs eternal" would be the cynical folk wisdom. FYI we haven't had a functioning constitution since the National Security Act of 1947 brought this nation under color of law, but the IC types wouldn't have you know that. Too tough to square the idea you'd never have had your CIA career in a world where the FISA court couldn't exist either. ..."
"... there is concrete evidence that the Democratic party/Clinton manipulated the primaries to destroy Clinton's challanger. That the DOJ, FBI & other alphabet agencies conspired with Clinton to equally, destroy Trump's campaign. ..."
"... We saw the same nonsense with Obama, the "peace president". Obama a man who never saw a Muslim he did not want to bomb or a Jew he did not want to bail out ..."
"... The best thing about this referral is that it also demands deputy AG Rod Rosenstein the weasel to recluse himself from this case. Rosenstein is the pinnacle of corruption by the deep state. ..."
"... Former CIA Director John Brennan is the prime mover behind the ongoing coup attempt against Trump. He gathered his deep state allies at DOJ and the FBI to join him in this endeavor. Brennan's allies -- McCabe, Lynch, Strzok, Yates, ect., may or may not be aware of Brennan's true motive behind creating all the noise and distraction since the 2016 election. It could be they're just partisan hacks; or they're on board with Brennan to keep secret what was revealed in the hack of the Podesta emails. ..."
"... Assange had 'physical proof' Russians didn't hack DNC, Rohrabacher says https://www.washingtontimes.com/news/2018/apr/19/julian-assange-has-physical-proof-russians-didnt-h/ ..."
"... I noticed Comey tried to pull a J Edgar-style subtle blackmail on Trump by the way he brought up the so-called "dossier" ..."
"... Bill Clinton got recruited into CIA by Cord Meyer, who bragged of it himself in his cups. ..."
"... Hillary cut her teeth on CIA's Watergate purge of Nixon. (If it's news to anyone that the Watergate cast of characters was straight out of CIA central casting, Russ Baker has conclusively tied the elaborate ratfeck to the intelligence community.) ..."
"... Obama was son of spooks, grandson of spooks, greased in to Harvard by Alwaleed bin-Talal's bagman. ..."
Apr 21, 2018 | www.unz.com

Wednesday's criminal referral by 11 House Republicans of former Secretary of State Hillary Clinton as well as several former and serving top FBI and Department of Justice (DOJ) officials is a giant step toward a Constitutional crisis.

Named in the referral to the DOJ for possible violations of federal law are: Clinton, former FBI Director James Comey; former Attorney General Loretta Lynch; former Acting FBI Director Andrew McCabe; FBI Agent Peter Strzok; FBI Counsel Lisa Page; and those DOJ and FBI personnel "connected to" work on the "Steele Dossier," including former Acting Attorney General Sally Yates and former Acting Deputy Attorney General Dana Boente.

With no attention from corporate media, the referral was sent to Attorney General Jeff Sessions, FBI Director Christopher Wray, and U.S. Attorney for the District of Utah John Huber. Sessions appointed Huber months ago to assist DOJ Inspector General (IG) Michael Horowitz. By most accounts, Horowitz is doing a thoroughly professional job. As IG, however, Horowitz lacks the authority to prosecute; he needs a U.S. Attorney for that. And this has to be disturbing to the alleged perps.

This is no law-school case-study exercise, no arcane disputation over the fine points of this or that law. Rather, as we say in the inner-city, "It has now hit the fan." Criminal referrals can lead to serious jail time. Granted, the upper-crust luminaries criminally "referred" enjoy very powerful support. And that will come especially from the mainstream media, which will find it hard to retool and switch from Russia-gate to the much more delicate and much less welcome "FBI-gate."

As of this writing, a full day has gone by since the letter/referral was reported, with total silence so far from T he New York Times and The Washington Post and other big media as they grapple with how to spin this major development. News of the criminal referral also slipped by Amy Goodman's non-mainstream DemocracyNow!, as well as many alternative websites.

The 11 House members chose to include the following egalitarian observation in the first paragraph of the letter conveying the criminal referral: "Because we believe that those in positions of high authority should be treated the same as every other American, we want to be sure that the potential violations of law outlined below are vetted appropriately." If this uncommon attitude is allowed to prevail at DOJ, it would, in effect, revoke the de facto "David Petraeus exemption" for the be-riboned, be-medaled, and well-heeled.

Stonewalling

Meanwhile, the patience of the chairmen of House committees investigating abuses at DOJ and the FBI is wearing thin at the slow-rolling they are encountering in response to requests for key documents from the FBI. This in-your-face intransigence is all the more odd, since several committee members have already had access to the documents in question, and are hardly likely to forget the content of those they know about. (Moreover, there seems to be a good chance that a patriotic whistleblower or two will tip them off to key documents being withheld.)

The DOJ IG, whose purview includes the FBI, has been cooperative in responding to committee requests for information, but those requests can hardly include documents of which the committees are unaware.

Putting aside his partisan motivations, House Intelligence Committee Chair Devin Nunes (R-CA) was unusually blunt two months ago in warning of legal consequences for officials who misled the Foreign Intelligence Surveillance Court in order to enable surveillance on Trump and his associates. Nunes's words are likely to have sent chills down the spine of those with lots to hide: "If they need to be put on trial, we will put them on trial," he said ."The reason Congress exists is to oversee these agencies that we created."

Whether the House will succeed in overcoming the resistance of those criminally referred and their many accomplices and will prove able to exercise its Constitutional prerogative of oversight is, of course, another matter -- a matter that matters.

And Nothing Matters More Than the Media

The media will be key to whether this Constitutional issue is resolved. Largely because of Trump's own well earned reputation for lying, most Americans are susceptible to slanted headlines like this recent one -- "Trump escalates attacks on FBI " -- from an article in The Washington Post , commiserating with the treatment accorded fired-before-retired prevaricator McCabe and the FBI he ( dis)served .

Nor is the Post above issuing transparently clever warnings -- like this one in a lead article on March 17: "Some Trump allies say they worry he is playing with fire by taunting the FBI. 'This is open, all-out war. And guess what? The FBI's going to win,' said one ally, who spoke on the condition of anonymity to be candid. 'You can't fight the FBI. They're going to torch him.'" [sic]

Mind-Boggling Criminal Activity

What motivated the characters now criminally "referred" is clear enough from a wide variety of sources, including the text messages exchange between Strzok and Page. Many, however, have been unable to understand how these law enforcement officials thought they could get away with taking such major liberties with the law.

None of the leaking, unmasking, surveillance, "opposition research," or other activities directed against the Trump campaign can be properly understood, if one does not bear in mind that it was considered a sure thing that Secretary Clinton would become President, at which point illegal and extralegal activities undertaken to help her win would garner praise, not prison. The activities were hardly considered high-risk, because candidate Clinton was sure to win.

But she lost.

Comey himself gives this away in the embarrassingly puerile book he has been hawking, "A Higher Loyalty" -- which

amounts to a pre-emptive move motivated mostly by loyalty-to-self, in order to obtain a Stay-Out-of-Jail card. Hat tip to Matt Taibbi of Rolling Stone for a key observation, in his recent article , "James Comey, the Would-Be J. Edgar Hoover," about what Taibbi deems the book's most damning passage, where Comey discusses his decision to make public the re-opening of the Hillary Clinton email investigation.

Comey admits, "It is entirely possible that, because I was making decisions in an environment where Hillary Clinton was sure to be the next president, my concern about making her an illegitimate president by concealing the re-started investigation bore greater weight than it would have if the election appeared closer or if Donald Trump were ahead in the polls."

The key point is not Comey's tortured reasoning, but rather that Clinton was "sure to be the next president." This would, of course, confer automatic immunity on those now criminally referred to the Department of Justice. Ah, the best laid plans of mice and men -- even very tall men. One wag claimed that the "Higher" in "A Higher Loyalty" refers simply to the very tall body that houses an outsized ego.

I think it can be said that readers of Consortiumnews.com may be unusually well equipped to understand the anatomy of FBI-gate as well as Russia-gate. Listed below chronologically are several links that might be viewed as a kind of "whiteboard" to refresh memories. You may wish to refer them to any friends who may still be confused.

2017

2018

Ray McGovern works with Tell the Word, a publishing arm of the ecumenical Church of the Saviour in inner-city Washington. He served as an Army Infantry/Intelligence officer and then a CIA analyst for a total of 30 years. In retirement, he co-created Veteran Intelligence Professionals for Sanity (VIPS).


Mike Whitney , April 20, 2018 at 4:15 am GMT

This story appears to be developing very fast. Interested readers might want to look at this short video on the Tucker Carlson show last night: http://video.foxnews.com/v/5773524495001/?playlist_id=5198073478001#sp=show-clips

Will McCabe wind up in jail? Will Comey? Will Hillary face justice? Fingers crossed!

jilles dykstra , April 20, 2018 at 6:05 am GMT
A weird country, the USA. Reading the article I'm reminded of the 1946 Senate investigation into Pearl Harbour, where, in my opinion, the truth was unearthed. At the same time, this truth hardly ever reached the wider public, no articles, the book, ed. Harry Elmer Barnes, never reviewed.
Greg Bacon , Website April 20, 2018 at 6:54 am GMT

Will McCabe wind up in jail? Will Comey? Will Hillary face justice? Fingers crossed!

The short answer is NO. McCabe might, but not Comey and the Killer Queen, they've both served Satan, uh I mean the Deep State too long and too well.Satan and the banksters–who really run the show–take care of their own and apex predators like Hillary won't go to jail. But it does keep the rubes entertained while the banksters continue to loot, pillage and plunder and Israel keeps getting Congress to fight their wars.

Ronald Thomas West , Website April 20, 2018 at 7:23 am GMT
"Hope springs eternal" would be the cynical folk wisdom. FYI we haven't had a functioning constitution since the National Security Act of 1947 brought this nation under color of law, but the IC types wouldn't have you know that. Too tough to square the idea you'd never have had your CIA career in a world where the FISA court couldn't exist either.

Consortium News many sops tossed to 'realpolitik' where false narrative is attacked with alternative false narrative, example given, drunk Ukrainian soldiers supposedly downing MH 17 with a BUK as opposed to Kiev's Interior Ministry behind the Ukrainian combat jet that actually brought down MH 17, poisons everything (trust issues) spewed from that news service.

The realpolitik 'face saving' exit/offer implied in the Consortium News narrative where Russia doesn't have to confront the West with Ukraine's (and by implication the western intelligence agencies) premeditated murder of 300 innocents does truth no favors.

Time to grow up and face reality. Realpolitik is dead; the caliber of 'statesman' required for these finessed geopolitical lies to function no longer exist on the Western side, and the Russians (I believe) are beginning to understand there is no agreement can be made behind closed doors that will hold up; as opposed to experiencing a backstabbing (like NATO not moving east.)

Back on topic; the National Security Act of 1947 and the USA's constitution are mutually exclusive concepts, where you have a Chief Justice appoints members of our FISA Court, er, nix that, let's call a spade a spade, it's a Star Chamber. There is no constitution to uphold, no matter well intended self deceits. There will be no constitutional crisis, only a workaround to pretend a constitution still exists:

https://ronaldthomaswest.com/2017/12/01/the-oath-and-the-trash-bin/

For those who prefer the satire:

https://ronaldthomaswest.com/2016/01/07/moot-court/^

animalogic , April 20, 2018 at 8:00 am GMT
To comprehend the internal machinations s of US politics one needs a mind capable of high level yoga or of squaring a circle. On the one hand there is a multimillion, full throttle investigation into – at best – nebulus, inconsequential links between trump/ his campaign & Russia.
On the other there is concrete evidence that the Democratic party/Clinton manipulated the primaries to destroy Clinton's challanger. That the DOJ, FBI & other alphabet agencies conspired with Clinton to equally, destroy Trump's campaign.

Naturally, its this 2nd conspiracy which is retarded. Imagine, a mere agency of a dept, the FBI, is widely considered untouchable by The President ! Indeed, they will "torch" him. AND the "the third estate" ie: the msm will support them the whole way! As a script the "The Twilight Zone" would have rejected all this as too ludicrous, too psychotic for even its broad minded viewers.

Jake , April 20, 2018 at 11:29 am GMT
The Deep State will make certain none of its most important functionaries get anything close to what they deserve.
redmudhooch , April 20, 2018 at 11:43 am GMT
Just a show, nothing will happen. Anything to keep you talking about anything other than 9/11, fake economy, fake war on terror, or Zionists..
jacques sheete , April 20, 2018 at 11:49 am GMT

And that will come especially from the mainstream media

I quit reading right there. Use of that term indicates mental laziness at best. What's mainstream about it? Please refer to corporate media in proper terms, such as PCR's "presstitute" media. Speaking of PCR, it's too bad he doesn't allow comments.

DESERT FOX , April 20, 2018 at 12:58 pm GMT
The MSM is controlled by Zionists as is the U.S. gov and the banks, so it is no surprise that the MSM protects the ones destroying America, this is what they do. Nothing of consequence will be done to any of the ones involved, it will all be covered up, as usual.
tjm , April 20, 2018 at 1:06 pm GMT
What utter nonsense. These people are ALL actors, no one will go to jail, because everything they do is contrived, no consequence for doing as your Zionist owners command.

There is no there there. This is nothing but another distraction, something o feed the dual narratives, that Clinton and her ilk are out to get Trump, and the "liberal media" will cover it up. This narrative feeds very nicely into the primary goal of driving Republicans/conservatives to support Trump, even as Trump does everything they elected him NOT TO DO!

We saw the same nonsense with Obama, the "peace president". Obama a man who never saw a Muslim he did not want to bomb or a Jew he did not want to bail out

Yet even while Obama did the work of the Zionist money machine, the media played up the fake battle between those who thought he was not born in America, "birthers" and his blind supporters.

Nothing came of any of it, just like Monica Lewinsky, nothing but theater, fill the air waves, divide the people, while America is driven insane.

anon [321] Disclaimer , April 20, 2018 at 1:49 pm GMT
The best thing about this referral is that it also demands deputy AG Rod Rosenstein the weasel to recluse himself from this case. Rosenstein is the pinnacle of corruption by the deep state. It's seriously way pass time for Jeff Sessions to grow a pair, put on his big boy pants, unrecuse himself from the Russian collusion bullshit case, fire Rosenstein and Mueller and end the case once and for all. These two traitors are in danger of completely derailing the Trump agenda and toppling the Republican majority in November, yet Jeff Sessions is still busy arresting people for marijuana, talk about missing the forest for the trees.

As far as where this referral will go from here, my guess is, nowhere. Not as long as Jeff Sessions the pussy is the AG. It's good to hear that Giuliani has now been recruited by Trump to be on his legal team. What Trump really needs to do is replace Jeff Sessions with Giuliani, or even Chris Christie, and let them do what a real AG should be doing, which is clean house in the DOJ, and prosecute the Clintons for their pay-to-play scheme with their foundation. Not only is the Clinton corruption case the biggest corruption case in US history, but this might be the only way to save the GOP from losing their majority in November.

anon [321] Disclaimer , April 20, 2018 at 1:54 pm GMT
@Greg Bacon

But it does keep the rubes entertained while the banksters continue to loot, pillage and plunder and Israel keeps getting Congress to fight their wars.

Sadly I think you're right. Things might be different if we had a real AG, but Jeff Sessions is not the man I thought he was. He's been swallowed by the deep state just like Trump. At least Trump is putting up a fight, Sessions just threw in the towel and recused himself from Day 1. Truly pathetic. Some patriot he is.

Twodees Partain , April 20, 2018 at 2:32 pm GMT
@Nick Granite

" He's ferreted out more than a few and probably has a lot better idea who his friends are he certainly knows the enemies by now."

He failed to ferret out Haley, Pompeo, or Sessions and he just recently appointed John Bolton, so I don't agree with your assessment. If his friends include those three, that says enough about Trump to make any of his earlier supporters drop him.

Anyway, not having a ready made team, or at least a solid short list of key appointees shows that he was just too clueless to have even been a serious candidate. It looks more as though Trump is doing now what he intended to do all along. That means he was bullshitting everybody during his campaign.

So, maybe the neocons really have been his friends all along.

Twodees Partain , April 20, 2018 at 2:46 pm GMT
@jacques sheete

It's also telling that Ray didn't mention what was included in the referral regarding an enforced recusal of Rosenstein going forward.

https://desantis.house.gov/_cache/files/8/0/8002ca75-52fc-4995-b87e-43584da268db/472EBC7D8F55C0F9E830D37CF96376A2.final-criminal-referral.pdf

Authenticjazzman , April 20, 2018 at 6:02 pm GMT
@Renoman

" America is a very crooked country, nothing suprises me".

Every country on this insane planet is "crooked" to a greater or lesser degree, when to a lesser degree, this is simply because they, the PTB, have not yet figured out how to accelerate, how to increase their corruption and thereby how to increase their unearned monetary holdings.

Money is the most potent singular factor which causes humans to lose their minds, and all of their ethics and decency.
And within the confines of a "socialist" system, "money" is replaced by rubber-stamps, which then wield, exactly in the manner of "wealth", the power of life or death, over the unwashed masses.

Authenticjazzman "Mensa" qualified since 1973, airborne trained US Army vet, and pro jazz musician.

anon [140] Disclaimer , April 20, 2018 at 7:24 pm GMT
@Ronald Thomas West

BTW Jeff Sessions is a fraternal brother of Pence (a member of the same club, same [recently deceased] guru) and is no friend of Trump.

That would explain why Sessions reclused himself from the start, and refused to appoint a special council to investigate the Clintons. He's in on this with Pence.

anon [140] Disclaimer , April 20, 2018 at 7:30 pm GMT
Just as it looks like the Comey memos will further exonerate Trump, we now have this farce extended by the DNC with this latest lawsuit on the "Trump campaign". The Democrats are now the most pathetic sore losers in history, they are hell bent on dragging the whole country down the pit of hell just because they can't handle a loss.
anon [140] Disclaimer , April 20, 2018 at 7:34 pm GMT
Wishful thinking that anything will come of this, just like when the Nunes memo was released. Nothing will happen as long as Jeff Sessions is AG. Trump needs to fire either Sessions or Rosenstein ASAP, before he gets dragged down by this whole Russian collusion bullshit case.
SunBakedSuburb , April 20, 2018 at 7:45 pm GMT
Former CIA Director John Brennan is the prime mover behind the ongoing coup attempt against Trump. He gathered his deep state allies at DOJ and the FBI to join him in this endeavor. Brennan's allies -- McCabe, Lynch, Strzok, Yates, ect., may or may not be aware of Brennan's true motive behind creating all the noise and distraction since the 2016 election. It could be they're just partisan hacks; or they're on board with Brennan to keep secret what was revealed in the hack of the Podesta emails.

John Podesta, in addition to being a top Democrat/DC lobbyist and a criminal deviant, is also a long-time CIA asset running a blackmail/influence operation that utilized his deviancy: the sexual exploitation of children.

Haxo Angmark , Website April 20, 2018 at 10:38 pm GMT
Seth Rich is still dead...
utu , April 20, 2018 at 11:33 pm GMT
Assange had 'physical proof' Russians didn't hack DNC, Rohrabacher says https://www.washingtontimes.com/news/2018/apr/19/julian-assange-has-physical-proof-russians-didnt-h/
UrbaneFrancoOntarian , April 21, 2018 at 12:18 am GMT
@anon

His cowardice is shocking. I wonder what they have on him? Probably some Roy Moore shit. Some shady stuff happened in the old South.

Ronald Thomas West , Website April 21, 2018 at 12:56 am GMT
@utu

https://ronaldthomaswest.com/2017/09/16/incompetent-espionage-wikileaks-iii/

Yeah, and General Kelly won't let Rohrabacher meet with Trump. What do you suppose is up with that (rhetorical question)

RobinG , April 21, 2018 at 1:02 am GMT
@utu

What kind of "physical proof" could Assange have? A thumb drive that was provably American, or something? Rohrabacher only got Red Pilled on Russia because he had one very determined (and well heeled) constituent. But he did cosponsor one of Tulsi Gabbard's "Stop Funding Terrorists" bills, which he figured out on his own. Nevertheless, a bit of a loose cannon and an eff'd up hawk on Iran He's probably an 'ISIS now, Assad later' on Syria.

anonymous [185] Disclaimer , April 21, 2018 at 2:36 am GMT
I noticed Comey tried to pull a J Edgar-style subtle blackmail on Trump by the way he brought up the so-called "dossier". Anyone could see it was absurd but he played his hand with it, pretending it was being looked at. I would say Trump could see through this sleazy game Comey was trying to play and sized him up. Comey is about as slimy as they get even as he parades around trying to look noble. What a corrupt bunch.
Culloden , April 21, 2018 at 2:45 am GMT
"The culprit has swayed with the immediate need for a villain "

[What follows is excerpted from an article headlined Robert Mueller's Questionable Past that appeared yesterday on the American Free Press website:]

During his tenure with the Justice Department under President George H W Bush, Mueller supervised the prosecutions of Panamanian leader Manuel Noriega, the Lockerbie bombing (Pan Am Flight 103) case, and Gambino crime boss John Gotti. In the Noriega case, Mueller ignored the ties to the Bush family that Victor Thorn illustrated in Hillary (and Bill): The Drugs Volume: Part Two of the Clinton Trilogy. Noriega had long been associated with CIA operations that involved drug smuggling, money laundering, and arms running. Thorn significantly links Noriega to Bush family involvement in the Iran-Contra scandal.

Regarding Pan Am Flight 103, the culprit has swayed with the immediate need for a villain. Pro-Palestinian activists, Libyans, and Iranians have all officially been blamed when US intelligence and the mainstream mass media needed to paint each as the antagonist to American freedom. Mueller toed the line, publicly ignoring rumors that agents onboard were said to have learned that a CIA drug-smuggling operation was afoot in conjunction with Pan Am flights. According to the theory, the agents were going to take their questions to Congress upon landing. The flight blew up over Lockerbie, Scotland.

http://lockerbiecase.blogspot.com/

"We were in Libya for oil" (only). Who said that:

http://www.firmmagazine.com

Bennis Mardens , April 21, 2018 at 2:47 am GMT
Without exception, leftists are degenerate filth.

But they won't be going to jail.

It's kabuki theater.

Art , April 21, 2018 at 5:21 am GMT
My god – who believes this woman?

Hillary says "they would never let me be president" – she is serious. She has gone bonkers with self-pity.

This is no longer laughable – it boarders on the pathological.

Art

WhiteWolf , April 21, 2018 at 5:39 am GMT
@Bennis Mardens

There has been some former high flyers going to jail recently. Sarkozy is facing a hard time at the moment. If it can happen to a former president of France it can happen to Hillary.

Stonehands , April 21, 2018 at 6:20 am GMT
@Twodees Partain

I still read ZH articles, but the commentariat has devolved to lockeroom towel-snapping, barely above YouTube chattering.

Stonehands , April 21, 2018 at 6:42 am GMT
@Ronald Thomas West

Ronald, thank-you for posting this Doug Coe sermon; l have never heard of him. BTW are you a Christian?

Stonehands , April 21, 2018 at 7:56 am GMT
@Ronald Thomas West

Ronald, thank-you for posting this Doug Coe sermon; l have never heard of him. BTW are you a Christian?

Twodees Partain , April 21, 2018 at 10:11 am GMT
@Culloden

Here's another about Mueller's involvement with the FBI's Whitey Bulger scandal.

https://saraacarter.com/questions-still-surround-robert-muellers-boston-past/

Mueller's past is so laden with misfeasance and malfeasance that he should have been disbarred a few decades ago.

Ronald Thomas West , Website April 21, 2018 at 1:14 pm GMT
@Stonehands

Am I a Christian? Well, no. I had some exposure to Christianity but it never took hold. On the other hand, I do believe there was a historical Jesus that was a remarkable man, but there is a world (or universe) of difference between the man and the mythology. Here's some of my thoughts on the matter:

https://ronaldthomaswest.com/2013/04/11/celebrating-the-anti-christ/

^ It doesn't necessarily go where the title might suggest (for many)

CIA in Charge , April 21, 2018 at 1:58 pm GMT
@Authenticjazzman

Nothing uncanny about it. There's a frenetic Democratic cottage industry inferring magical emotional charisma powers that explain the outsized influence of those three. The fact is very simple. All three are CIA nomenklatura.

(1.) Bill Clinton got recruited into CIA by Cord Meyer, who bragged of it himself in his cups.

(2.) Hillary cut her teeth on CIA's Watergate purge of Nixon. (If it's news to anyone that the Watergate cast of characters was straight out of CIA central casting, Russ Baker has conclusively tied the elaborate ratfeck to the intelligence community.)

(3.) Obama was son of spooks, grandson of spooks, greased in to Harvard by Alwaleed bin-Talal's bagman. While he was vocationally wet behind the ears he not only got into Pakistan, no mean feat at the time, but he went to a falconry outing with the future acting president of Pakistan. And is there anyone alive who wasn't flabbergasted at the instant universal acclaim for some empty suit who made a speech at the convention? Like Bill Clinton, successor to DCI Bush, Obama was blatantly, derisively installed in the president slot of the CIA org chart.

Authenticjazzman , April 21, 2018 at 6:06 pm GMT
@CIA in Charge

Excellent post and quite accurate information, however my point being that the irrational fear harbored by the individuals who could actually begin to rope these scumbags in, is just that : Irrational, as they seem to think or have been lead/brainwashed to believe that these dissolute turds are somehow endowed with supernatural, otherworldy powers and options, and that they are capable of unholy , merciless vengeance : VF, SR, etc.

And the truth is as soon as they finally start to go after them they, they will fall apart at the seams, such as with all cowards, and this is the bottom line : They, the BC/HC/BO clique, they are nothing more than consumate cowards, who can only operate in such perfidious manners when left unchallenged.

Authenticjazzman "Mensa" qualified since 1973, airborne trained US Army vet, and pro Jazz artist.

[Apr 13, 2018] The End of International Law by Thierry Meyssan

Notable quotes:
"... Bill Clinton attacked Yugoslavia, blithely violating Internal Law. George Bush Jr. did the same by attacking Iraq, and Barack Obama by attacking Libya and Syria. As for Donald Trump, he has never hidden his distrust of supra-national rules. ..."
"... " Globalisation ", in other words the " globalisation of Anglo-Saxon values ", has created a class society between states. ..."
"... " Communication ", a new name for " propaganda ", has become the imperative in international relations. From the US Secretary of State brandishing a phial of pseudo-anthrax to the British Minister for Foreign Affairs lying about the origin of Novitchok in the Salisbury affair, lies have become the substitute for respect, and cause general mistrust. ..."
"... Russia is wondering today about the possible desire of the Western powers to block the United Nations. If this is so, it would create an alternative institution, but there would no longer be a forum which would enable the two blocks to discuss matters. ..."
Apr 13, 2018 | www.voltairenet.org

o the Western powers hope to put an end to the constraints of International Law? That is the question asked by the Russian Minister for Foreign Affairs, Sergueï Lavrov, at the Moscow conference on International Security [ 1 ].

Over the last few years, Washington has been promoting the concept of " unilateralism ". International Law and the United Nations are supposed to bow to the power of the United States.

This concept of political life is born of the History of the United States - the colonists who came to the Americas intended to live as they chose and make a fortune there. Each community developed its own laws and refused the intervention of a central government in local affairs. The President and the Federal Congress are charged with Defense and Foreign Affairs, but like the citizens themselves, they refused to accept an authority above their own.

Bill Clinton attacked Yugoslavia, blithely violating Internal Law. George Bush Jr. did the same by attacking Iraq, and Barack Obama by attacking Libya and Syria. As for Donald Trump, he has never hidden his distrust of supra-national rules.

Making an allusion to the Cebrowski-Barnett doctrine [ 2 ], Sergueï Lavrov declared: " We have the clear impression that the United States seek to maintain a state of controlled chaos in this immense geopolitical area [the Near East], hoping to use it to justify the military presence of the USA in the region, without any time limit, in order to promote their own agenda ".

The United Kingdom also seem to feel quite comfortable with breaking the Law. Last month, it accused Moscow in the " Skripal affair ", without the slightest proof, and attempted to unite a majority of the General Assembly of the UN to exclude Russia from the Security Council. It would of course be easier for the Anglo-Saxons to unilaterally rewrite the Law without having to take notice of the opinions of their opponents.

Moscow does not believe that London took this initiative. It considers that Washington is calling the shots.

" Globalisation ", in other words the " globalisation of Anglo-Saxon values ", has created a class society between states. But we should not confuse this new problem with the existence of the right to a veto. Of course, the UNO, while it declares equality between states whatever their size, distinguishes, within the Security Council, five permanent members who have a veto. This Directorate, composed of the main victors of the Second World War, is a necessity for them to accept the principle of supra-national Law. However, when this Directorate fails to embody the Law, the General Assembly may take its place. At least in theory, because the smaller states which vote against a greater state are obliged to suffer retaliatory measures.

La " globalisation of Anglo-Saxon values " ignores honour and highlights profit, so that the weight of the propositions by any state will be measured only by the economic development of its country. However, over the years, three states have managed to gain an audience to the foundations of their propositions, and not in function of their economy – they are the Iran of Mahmoud Ahmadinejad (today under house arrest in his own country), the Venezuela of Hugo Chávez, and the Holy See.

The confusion engendered by Anglo-Saxon values has led to the financing of intergovernmental organisations with private money. As one thing leads to another, the member states of the International Telecommunication Union (ITU), for example, have progressively abandoned their propositional power to the profit of private telecom operators, who are united in a " consultative committee ".

" Communication ", a new name for " propaganda ", has become the imperative in international relations. From the US Secretary of State brandishing a phial of pseudo-anthrax to the British Minister for Foreign Affairs lying about the origin of Novitchok in the Salisbury affair, lies have become the substitute for respect, and cause general mistrust.

During the first years of its creation, the UNO attempted to forbid " war propaganda ", but today, it is the permanent members of the Security Council who indulge in it.

The worst occurred in 2012, when Washington managed to obtain the nomination of one of its worst war-hawks, Jeffrey Feltman, as the number 2 of the UNO [ 3 ]. From that date onward, wars have been orchestrated in New York by the very institution that is supposed to prevent them.

Russia is wondering today about the possible desire of the Western powers to block the United Nations. If this is so, it would create an alternative institution, but there would no longer be a forum which would enable the two blocks to discuss matters.

Just as a society which falls into chaos, where men are wolves for men when deprived of the Law, so the world will become a battle-field if it abandons International Law. Thierry Meyssan

[Apr 01, 2018] All the President s Women by Andrew Levine

This is probably the most vicious attack on Trump trangressions that i encountered so far...
Notable quotes:
"... The problem for Trump is that what his accusers are saying puts him in legal and political jeopardy. They are claiming, in effect, that he has committed a variety of unlawful and impeachable offenses – from obstruction of justice to violations of campaign finance laws. ..."
"... The Clinton-Lewinsky dalliance led to a series of events that prevented Clinton from doing even more harm to our feeble welfare state institutions than he would otherwise have done. ..."
"... Fire and Fury ..."
Apr 01, 2018 | www.counterpunch.org

There is no doubt about it: Stormy Daniels is a formidable woman. Karen McDougal is no slouch either, though she is hard to admire after that riff, in her Anderson Cooper interview, about how religious and Republican she is; she even said that she used to love the Donald. Stormy Daniels is better than that.

How wonderfully appropriate it would be if she were to become the proverbial straw that breaks the camel's back.

Even in a world as topsy-turvy as ours has become, there has to be a final straw.

To be sure, evidence of Trump's vileness, incompetence, and mental instability is accumulating at breakneck speed, and there are polls now that show support for him holding fast or even slightly rising. Trump's hardcore "base" seems more determined than ever to stand by their man.

But even people as benighted as they are bound to realize eventually that they have been had. Many of them already do, but don't care; they hate Clinton Democrats that much. This is understandable, but foolish; so foolish, in fact, that they can hardly keep it up indefinitely.

To think otherwise is to despair for the human race.

What, if anything, can bring them to their senses in time for the 2018 election?

Stormy Daniels says she only wants to tell her story, not bring Trump down. But her political instincts seem decent, and she is one shrewd lady. Therefore, I would not be the least surprised if that is not quite true. It hardly matters, though, what her intentions are; I'd put my money on her.

A recession might also do the trick. A recession is long overdue, and Trump's tax cut for the rich and his tariffs are sure to make its consequences worse when it happens.

To turn significant portions of Trump's base against him, a major military conflagration might also do -- not the kind Barack Obama favored, fought far away and out of public view, but a real war, televised on CNN, and waged against an enemy state like North Korea or Iran. It would have to go quickly and disastrously wrong, though, in ways that even willfully blind, terminally obtuse Trump supporters could not fail to see.

Or the gods could smile upon us, causing Trump's exercise regimen (sitting in golf carts) and his fat-ridden, cholesterol rich diet to catch up with him, as it would with most other sedentary septuagenarians. The only downside would be that a heart attack or stroke might elicit sympathy for the poor bastard. No sane person could or should hope for a calamitous economic downturn or for yet another devastating, pointless, and manifestly unjust war, especially one that could become a war to end all wars (along with everything else), on the off-chance that some good might come of it. And if the best we can do is hope that cheeseburgers with fries will save us, we are grasping at straws.

These are compelling reasons to hope that the accusations made by Daniels and McDougal and Summer Zervos – and other consensual and non-consensual Trump victims and "playmates" – gain traction. If the several defamation lawsuits now in the works can get the president deposed, this is not out of the question.

The problem for Trump is not that his accusers' revelations will cause his base to defect; no matter how salacious their stories and no matter how believable they may be. Trump's moral turpitude is taken for granted in their circles; and they do not care about the myriad ways his words and deeds offend the dignity of the office he holds or embarrass the country he purports to put "first." If any of that mattered to them, they would have jumped ship long ago.

Except perhaps for unreconstructed racists and certifiable sociopaths, white evangelicals are Trump's strongest supporters. What a despicable bunch of hypocrites they are! As long as Trump delivers on their agendas, his salacious escapades don't faze them at all. Godly folk have evidently changed a good deal since the Cotton Mather days.

What has not changed is their seemingly limitless ability to believe nonsense.

And in case light somehow does manage to shine through, Trump has shown them how to restore the darkness they crave. When cognitive dissonance threatens, all they need do is scream "fake news."

The problem for Trump is that what his accusers are saying puts him in legal and political jeopardy. They are claiming, in effect, that he has committed a variety of unlawful and impeachable offenses – from obstruction of justice to violations of campaign finance laws.

In this case as in so many others, it is the cover-up, not the underlying "crime," that could lead to his undoing – especially if the stories Daniels and the others are telling shed light upon or otherwise connect with or meld into Robert Mueller's investigation of (alleged) Russian "meddling" in the 2016 election.

Trump could and probably will survive their charges. His base is such a preternaturally obdurate lot that there may ultimately be no last straw for them. We may have no choice, in the end, but to despair for a sizeable chunk of the human race.

Stormy Daniels would not be any less admirable on that account. She took Trump on and came out on top. For all the world (minus the willfully blind) to see, she, the porn star, is a strong woman who has her life together, while he, the president, is a discombobulated sleaze ball who is leading himself and his country to ruin.

***

It was different with Monica Lewinsky, another presidential paramour who, almost two decades ago, also held the world's attention.

There was nothing sleazy or venal about Lewinsky's involvement with Bill Clinton; and, for all I know, unless chastity counts, she is as good and virtuous a person as can be. But personal qualities are not what made her affair with our forty-second president as historically significant as it turned out to be.

It would be fair to say that of all the women who have ever had intimate knowledge of that old horn dog's private parts, there is no one who did more good for her country. If only for that, if there were a heaven, there would be special place in it just for her.

The Clinton-Lewinsky dalliance led to a series of events that prevented Clinton from doing even more harm to our feeble welfare state institutions than he would otherwise have done.

Who knows how much progress he would have turned back had he and Monica never done the deed or at least not been found out. Building on groundwork laid down by Ronald Reagan and the first George Bush, he and his wife had already terminated Aid to Families With Dependent Children, one of the main government programs aimed at relieving poverty. This was to be just the first step in "ending welfare as we know it."

With their "donors" pushing for more austerity, those two neoliberal pioneers were itching to begin privatizing other, more widely supported social programs, including even Social Security, the so-called "third rail" of American politics.

The "Lewinsky matter" put the kybosh on that idea, leaving the American people forever in Monica's debt.

Back in the Kennedy days, Mel Brook's two-thousand year old man got it right when he said: presidents "gotta do it," to which he added – " because if they don't do it to their wives and girlfriends, they do it to the nation."

Stormy Daniels made much the same point ten years ago, while flirting with the idea of running against Louisiana Senator David Vitter. Vitter's political career had been almost ruined when his name turned up in the phone records of the infamous "DC Madam," Deborah Jeane Palfrey. Daniels told voters that, unlike Vitter, she would "screw (them) honestly."

What then are we to make of the fact that Trump screws both the nation and his wife (maybe) and his girlfriends (or whatever they are)?

Blame it on arrested development, on the fact that despite his more than seventy-one years, Trump still has the mind of a teenage boy, one with money and power enough to live out his fantasies.

The contrast with Bill Clinton is stark. Clinton is a philanderer with eclectic tastes, a charming rascal with a broad and mischievous mind. Honkytonk women from Arkansas appeal to him as much as zaftig MOTs from the 90210 area code.

Trump, on the other hand, goes for super-models, Playboy centerfolds, and aspiring beauty queens -- standard teenage fantasy fare.

He seems to have had little trouble living his dreams – not thanks to his magnetic face, form and figure, and certainly not to his refinement, wit or charm, but to his inherited and otherwise ill-gotten wealth.

It is money and the power that follows from it that draws women to his net.

Henry Kissinger understood; recall his musings on the aphrodisiacal properties of power. Even in his prime, that still unindicted war criminal (and later-day Hillary Clinton advisor) was even more repellent than Trump. But that never kept him from having to fight the ladies off.

This fact of life puts a heavy responsibility on the women with whom presidents hook up.

Consider Melania. She made a Faustian bargain when she agreed to become Trump's trophy bride; in return for riches and a soft life in a gilded tower, she sold her soul. She might have thought better of it had she taken the burdens she would incur as First Lady into account, but why would she? The prospect was too improbable.

She has, it seems, a very practical, old world view of marriage, and is therefore tolerant of her husband's womanizing. At the same time, as a mother and daughter, she is, like most immigrants, a strong proponent of old world "family values."

Too much of a proponent perhaps; insofar as her idea was to "chain migrate" her parents out of Slovenia and onto Easy Street, or to raise a kid who would never want for anything, there were less onerous ways of going about it. After all, there are plenty of rich Americans lusting after supermodels out there, and it is a good bet that many of them are less repellent than Trump.

She was irresponsible as well. She ought to have realized that the man she married had already spawned two idiot sons, along with other fruit from the poisonous tree, and that four bad apples in one generation are enough.

And so now she finds herself a single mother – not in theory, of course, but very definitely in practice. Unlike most women in that position, she is not wanting for resources. But it must be a hard slog, even so. To her credit, Melania seems to be handling the burden well. More power to her!

She also deserves credit for her body language when the Donald is around; the contempt she shows for him is wonderful to behold. Best of all is her sense of the absurd. The way she plagiarized from Michelle Obama had obvious comic validity, and making childhood bullying her First Lady cause – all First Ladies have causes -- was a stroke of genius.

On balance, therefore, it is hard not to feel sorry for her. Of all the women in Trump's ambit, she deserves humiliation the least.

The rumor mill has it that with all the publicity about Daniels and the others , she has finally had enough. This may be the case; the old world ethos requires discretion and a concern with appearances. That is not the Donald's way, however, and now she is paying the price.

What a magnificent humiliation it would be if she and Trump were to split up on that account. This could happen soon. I would expect, though, that through a combination of carrots and sticks, Trump and his fixers will find a way to minimize the political effects. More likely still, they will channel Joe Kennedy and Jackie O, and figure out a way to head the problem off.

Then there is poor forgotten Tiffany. Her Wikipedia entry lists her as both a law student and a "socialite." I hope her studious side wins out and that, despite the genes from her father's side, she is at least somewhat decent and smart.

I'd be more confident of that if she would do what Ronald Reagan's daughter, Patti, did: use her mother's, not her father's, name. Unless she is a sleaze ball too, a Trump in the Eric and Don Junior mold, that would be a fine way to make a political point.

It would also pay back over the years. With the Trump administration on its current trajectory, who, in a few years' time, would take a Tiffany Trump seriously? A Tiffany Maples would stand a better chance.

Her half-sister, the peerless Ivanka, the Great Blonde Hope, is, of course, her father's sweetie. Let's not go there, however. Her marriage to Jared Kushner is already enough to process.

What a pair those two make; and what a glorious day it will be when the law finally catches up with Jared, as it did with his Trump-like father, Charles. Perhaps he will take Ivanka down a notch or two with him. Despite an almost complete lack of qualifications, Trump made his son-in-law his minister of almost everything; a pretty good gig for a feckless, airhead rich kid. Among other things, Trump enabled him to become Benjamin Netanyahu's ace in the hole. Netanyahu is a Kushner family friend. Netanyahu has more than his share of legal troubles too. Let them all go down together!

Ivanka and Jared are well matched – they share a "business model." It has them exploiting their daddies' connections and money.

Jared peddles real estate; his efforts have gotten his family into serious debt, while putting him in solid with Russian and Eastern European oligarchs, Gulf state emirs, and Mohammad bin Salman – people in comparison with whom his father-in-law seems almost virtuous.

Ivanka sells trinkets and schmatas to people who think the Trump name is cool. There actually are such people; at two hundred grand a pop, Mar-a-Lago is full of them. Ivanka's demographic is made up mostly of their younger set.

Two other presidential women bare mention: Hope Hicks and Nikki Haley. Surely, they both have tales to tell, but it looks, for now, as if their stories would be of little or no prurient interest. Neither of them appear to have been propositioned or groped.

Even though Hicks is said to be like a daughter to the Donald – we know what that could mean! – it is a safe bet that there was nothing of a romantic nature going on between them. For one thing, Hicks seems too close to Ivanka; for another, she is known to have dallied with two Trump subordinates, Corey Lewandowski and Rob Porter. The don is hardly the type to let his underlings have at his women.

Haley had to quash a spate of rumors that flared up thanks to some suggestive remarks Michael Wolff made while hawking Fire and Fury . The rumor caught on because people who hadn't yet fully realized what a piece of work Trump is, imagined that something had to be awry inasmuch as her main qualification for representing the United States at the United Nations was an undergraduate degree in accounting. Abject servility to the Israel lobby also helped.

But the Trump administration is full of ambitious miscreants whose views on Israel and Palestine are as abject and servile as hers, and compared to many others in Trump's cabinet she is, if anything, over qualified. Think of neurosurgeon Ben Carson heading the Department of Housing and Urban Development. He is qualified because, as a child, he lived in public housing.

With the exception of Stormy Daniels, Karen McDougal, Summer Zervos and whoever else comes forward with a juicy and credible tale to tell, the women currently in the president's ambit, though good for gossip and interesting in the ways that characters on reality TV shows can be, are of little or no political consequence.

This could change if any of them decides to "go rogue," to use an expression from the Sarah Palin days. But, while neither Melania nor Tiffany can yet be judged hopeless, it would be foolish to expect much of anything good to come from either of them.

Stormy, Karen, Summer, and whoever else steps forward are a better bet. They are the only ones with any chance of doing as much for their country and the world as Monica Lewinsky did a generation ago.

Among the president's women, they are a breed apart. This is plainly the case with Stormy Daniels; it is already clear that she deserves what all Trump's money can never buy – honor and esteem. To the extent that the others turn out to be similarly courageous, they will too.

[Apr 01, 2018] Big American Money, Not Russia, Put Trump in the White House: Reflections on a Recent Report by Paul Street

Highly recommended!
Notable quotes:
"... Running against what she (wrongly) perceived (along with most election prognosticators) as a doomed and feckless opponent and as the clear preferred candidate of Wall Street and the intimately related U.S foreign policy elite , including many leading Neoconservatives put off by Trump's isolationist and anti-interventionist rhetoric, the "lying neoliberal warmonger" Hillary Clinton arrogantly figured that she could garner enough votes to win without having to ruffle any ruling-class feathers. ..."
"... Smart Wall Street and K Street Democratic Party bankrollers have long understood that Democratic candidates have to cloak their dollar-drenched corporatism in the deceptive campaign discourse of progressive- and even populist-sounding policy promise to win elections. ..."
"... Trump trailed well behind Clinton in contributions from defense and aerospace – a lack of support extraordinary for a Republican presidential hopeful late in the race. ..."
"... one fateful consequence of trying to appeal to so many conservative business interests was strategic silence about most important matters of public policy. Given the candidate's steady lead in the polls, there seemed to be no point to rocking the boat with any more policy pronouncements than necessary ..."
"... Misgivings of major contributors who worried that the Clinton campaign message lacked real attractions for ordinary Americans were rebuffed. The campaign sought to capitalize on the angst within business by vigorously courting the doubtful and undecideds there, not in the electorate ..."
"... Of course, Bill and Hillary helped trail-blaze that plutocratic "New Democrat" turn in Arkansas during the late 1970s and 1980s. The rest, as they say, was history – an ugly corporate-neoliberal, imperial, and racist history that I and others have written about at great length. ..."
"... My Turn: Hillary Clinton Targets the Presidency ..."
"... Queen of Chaos: The Misadventures of Hillary Clinton ..."
"... The Condemnation of Little B: New Age Racism in America ..."
"... Still, Trump's success was no less tied to big money than was Hillary's failure. Candidate Trump ran strangely outside the longstanding neoliberal Washington Consensus, as an economic nationalist and isolationist. His raucous rallies were laced with dripping denunciations of Wall Street, Goldman Sachs, and globalization, mockery of George W. Bush's invasion of Iraq, rejection of the New Cold War with Russia, and pledges of allegiance to the "forgotten" American "working-class." He was no normal Republican One Percent candidate. ..."
"... Globalization has made the financial elite who donate to politicians very wealthy. But it has left millions of our workers with nothing but poverty and heartache ..."
"... "In a frontal assault on the American establishment, the Republican standard bearer proclaimed 'America First.' Mocking the Bush administration's appeal to 'weapons of mass destruction' as a pretext for invading Iraq, he broke dramatically with two generations of GOP orthodoxy and spoke out in favor of more cooperation with Russia . He even criticized the 'carried interest' tax break beloved by high finance" (emphasis added). ..."
"... "What happened in the final weeks of the campaign was extraordinary. Firstly, a giant wave of dark money poured into Trump's own campaign – one that towered over anything in 2016 or even Mitt Romney's munificently financed 2012 effort – to say nothing of any Russian Facebook experiments [Then] another gigantic wave of money flowed in from alarmed business interests, including the Kochs and their allies Officially the money was for Senate races, but late-stage campaigning for down-ballot offices often spills over on to candidates for the party at large." ..."
"... "In a harbinger of things to come, additional money came from firms and industries that appear to have been attracted by Trump's talk of tariffs, including steel and companies making machinery of various types [a] vast wave of new money flowed into the campaign from some of America's biggest businesses and most famous investors. Sheldon Adelson and many others in the casino industry delivered in grand style for its old colleague. Adelson now delivered more than $11 million in his own name, while his wife and other employees of his Las Vegas Sands casino gave another $20 million. ..."
"... Peter Theil contributed more than a million dollars, while large sums also rolled in from other parts of Silicon Valley, including almost two million dollars from executives at Microsoft and just over two million from executives at Cisco Systems. ..."
"... Among those were Nelson Peltz and Carl Icahn (who had both contributed to Trump before, but now made much bigger new contributions). In the end, along with oil, chemicals, mining and a handful of other industries, large private equity firms would become one of the few segments of American business – and the only part of Wall Street – where support for Trump was truly heavy the sudden influx of money from private equity and hedge funds clearly began with the Convention but turned into a torrent " ..."
"... The critical late wave came after Trump moved to rescue his flagging campaign by handing its direction over to the clever, class-attuned, far-right white- and economic- nationalist "populist" and Breitbart executive Steve Bannon, who advocated what proved to be a winning, Koch brothers-approved "populist" strategy: appeal to economically and culturally frustrated working- and middle-class whites in key battleground states, where the bloodless neoliberal and professional class centrism and snooty metropolitan multiculturalism of the Obama presidency and Clinton campaign was certain to depress the Democratic "base" vote ..."
"... Neither turnout nor the partisan division of the vote at any level looks all that different from other recent elections 2016's alterations in voting behavior are so minute that the pattern is only barely differentiated from 2012." ..."
"... An interesting part of FJC's study (no quick or easy read) takes a close look at the pro-Trump and anti-Hillary Internet activism that the Democrats and their many corporate media allies are so insistently eager to blame on Russia and for Hillary's defeat. FJC find that Russian Internet interventions were of tiny significance compared to those of homegrown U.S. corporate and right-wing cyber forces: ..."
"... By 2016, the Republican right had developed internet outreach and political advertising into a fine art and on a massive scale quite on its own. ..."
"... Breitbart and other organizations were in fact going global, opening offices abroad and establishing contacts with like-minded groups elsewhere. Whatever the Russians were up to, they could hardly hope to add much value to the vast Made in America bombardment already underway. Nobody sows chaos like Breitbart or the Drudge Report ." ..."
"... no support from Big Business ..."
"... Sanders pushed Hillary the Goldman candidate to the wall, calling out the Democrats' capture by Wall Street, forcing her to rely on a rigged party, convention, and primary system to defeat him. The small-donor "socialist" Sanders challenge represented something Ferguson and his colleagues describe as "without precedent in American politics not just since the New Deal, but across virtually the whole of American history a major presidential candidate waging a strong, highly competitive campaign whose support from big business is essentially zero ." ..."
"... American Oligarchy ..."
"... teleSur English ..."
"... we had no great electoral democracy to subvert in 2016 ..."
"... Only candidates and positions that can be financed can be presented to voters. As a result, in countries like the US and, increasingly, Western Europe, political parties are first of all bank accounts . With certain qualifications, one must pay to play. Understanding any given election, therefore, requires a financial X-ray of the power blocs that dominate the major parties, with both inter- and intra- industrial analysis of their constituent elements." ..."
"... Elections alone are no guarantee of democracy, as U.S. policymakers and pundits know very well when they rip on rigged elections (often fixed with the assistance of U.S. government and private-sector agents and firms) in countries they don't like ..."
"... Majority opinion is regularly trumped by a deadly complex of forces in the U.S. ..."
"... Trump is a bit of an anomaly – a sign of an elections and party system in crisis and an empire in decline. He wasn't pre-approved or vetted by the usual U.S. " deep state " corporate, financial, and imperial gatekeepers. The ruling-class had been trying to figure out what the Hell to do with him ever since he shocked even himself (though not Steve Bannon) by pre-empting the coronation of the "Queen of Chaos." ..."
"... His lethally racist, sexist, nativist, nuclear-weapons-brandishing, and (last but not at all least) eco-cidal rise to the nominal CEO position atop the U.S.-imperial oligarchy is no less a reflection of the dominant role of big U.S. capitalist money and homegrown plutocracy in U.S. politics than a more classically establishment Hillary ascendancy would have been. It's got little to do with Russia, Russia, Russia – the great diversion that fills U.S. political airwaves and newsprint as the world careens ever closer to oligarchy-imposed geocide and to a thermonuclear conflagration that the RussiaGate gambit is recklessly encouraging. ..."
Mar 30, 2018 | www.counterpunch.org

"She Doesn't Have Any Policy Positions"

On the Friday after the Chicago Cubs won the World Series and prior to the Tuesday on which the vicious racist and sexist Donald Trump was elected President of the United States, Bernie Sanders spoke to a surprisingly small crowd in Iowa City on behalf of Hillary Clinton. As I learned months later, Sanders told one of his Iowa City friends that day that Mrs. Clinton was in trouble. The reason, Sanders reported, was that Hillary wasn't discussing issues or advancing real solutions. "She doesn't have any policy positions," Sanders said.

The first time I heard this, I found it hard to believe. How, I wondered, could anyone run seriously for the presidency without putting issues and policy front and center? Wouldn't any serious campaign want a strong set of issue and policy positions to attract voters and fall back on in case and times of adversity?

Sanders wasn't lying. As the esteemed political scientist and money-politics expert Thomas Ferguson and his colleagues Paul Jorgensen and Jie Chen note in an important study released by the Institute for New Economic Thinking two months ago, the Clinton campaign "emphasized candidate and personal issues and avoided policy discussions to a degree without precedent in any previous election for which measurements exist .it stressed candidate qualifications [and] deliberately deemphasized issues in favor of concentrating on what the campaign regarded as [Donald] Trump's obvious personal weaknesses as a candidate."

Strange as it might have seemed, the reality television star and presidential pre-apprentice Donald Trump had a lot more to say about policy than the former First Lady, U.S. Senator, and Secretary of State Hillary Clinton, a wonkish Yale Law graduate.

"Courting the Undecideds in Business, not in the Electorate"

What was that about? My first suspicion was that Hillary's policy silence was about the money. It must have reflected her success in building a Wall Street-filled campaign funding war-chest so daunting that she saw little reason to raise capitalist election investor concerns by giving voice to the standard fake-progressive "hope" and "change" campaign and policy rhetoric Democratic presidential contenders typically deploy against their One Percent Republican opponents. Running against what she (wrongly) perceived (along with most election prognosticators) as a doomed and feckless opponent and as the clear preferred candidate of Wall Street and the intimately related U.S foreign policy elite , including many leading Neoconservatives put off by Trump's isolationist and anti-interventionist rhetoric, the "lying neoliberal warmonger" Hillary Clinton arrogantly figured that she could garner enough votes to win without having to ruffle any ruling-class feathers. She would cruise into the White House with no hurt plutocrat feelings simply by playing up the ill-prepared awfulness of her Republican opponent.

If Ferguson, Jorgensen, and Chen (hereafter "JFC") are right, I was on to something but not the whole money and politics story. Smart Wall Street and K Street Democratic Party bankrollers have long understood that Democratic candidates have to cloak their dollar-drenched corporatism in the deceptive campaign discourse of progressive- and even populist-sounding policy promise to win elections. Sophisticated funders get it that the Democratic candidates' need to manipulate the electorate with phony pledges of democratic transformation. The big money backers know it's "just politics" on the part of candidates who can be trusted to serve elite interests (like Bill Clinton 1993-2001 and Barack Obama 2009-2017 ) after they gain office.

What stopped Hillary from playing the usual game – the "manipulation of populism by elitism" that Christopher Hitchens once called "the essence of American politics" – in 2016, a year when the electorate was in a particularly angry and populist mood? FJC's study is titled " Industrial Structure and Party Competition in an Age of Hunger Games : Donald Trump and the 2016 Presidential Election." It performs heroic empirical work with difficult campaign finance data to show that Hillary's campaign funding success went beyond her party's usual corporate and financial backers to include normally Republican-affiliated capitalist sectors less disposed than their more liberal counterparts to abide the standard progressive-sounding policy rhetoric of Democratic Party candidates. FJC hypothesize that (along with the determination that Trump was too weak to be taken all that seriously) Hillary's desire get and keep on board normally Republican election investors led her to keep quiet on issues and policy concerns that mattered to everyday people. As FJC note:

"Trump trailed well behind Clinton in contributions from defense and aerospace – a lack of support extraordinary for a Republican presidential hopeful late in the race. For Clinton's campaign the temptation was irresistible: Over time it slipped into a variant of the strategy [Democrat] Lyndon Johnson pursued in 1964 in the face of another [Republican] candidate [Barry Goldwater] who seemed too far out of the mainstream to win: Go for a grand coalition with most of big business . one fateful consequence of trying to appeal to so many conservative business interests was strategic silence about most important matters of public policy. Given the candidate's steady lead in the polls, there seemed to be no point to rocking the boat with any more policy pronouncements than necessary . Misgivings of major contributors who worried that the Clinton campaign message lacked real attractions for ordinary Americans were rebuffed. The campaign sought to capitalize on the angst within business by vigorously courting the doubtful and undecideds there, not in the electorate " (emphasis added). Hillary Happened

FJC may well be right that a wish not to antagonize off right-wing campaign funders is what led Hillary to muzzle herself on important policy matters, but who really knows? An alternative theory I would not rule out is that Mrs. Clinton's own deep inner conservatism was sufficient to spark her to gladly dispense with the usual progressive-sounding campaign boilerplate. Since FJC bring up the Johnson-Goldwater election, it is perhaps worth mentioning that 18-year old Hillary was a "Goldwater Girl" who worked for the arch-reactionary Republican presidential candidate in 1964. Asked about that episode on National Public Radio (NPR) in 1996 , then First Lady Hillary said "That's right. And I feel like my political beliefs are rooted in the conservatism that I was raised with. I don't recognize this new brand of Republicanism that is afoot now, which I consider to be very reactionary, not conservative in many respects. I am very proud that I was a Goldwater girl."

It was a revealing reflection. The right-wing Democrat Hillary acknowledged that her ideological world view was still rooted in the conservatism of her family of origin. Her problem with the reactionary Republicanism afoot in the U.S. during the middle 1990s was that it was "not conservative in many respects." Her problem with the far-right Republican Congressional leaders Newt Gingrich and Tom DeLay was that they were betraying true conservatism – "the conservatism [Hillary] was raised with." This was worse even than the language of the Democratic Leadership Conference (DLC) – the right-wing Eisenhower Republican (at leftmost) tendency that worked to push the Democratic Party further to the Big Business-friendly right and away from its working-class and progressive base.

Of course, Bill and Hillary helped trail-blaze that plutocratic "New Democrat" turn in Arkansas during the late 1970s and 1980s. The rest, as they say, was history – an ugly corporate-neoliberal, imperial, and racist history that I and others have written about at great length. (I cannot reprise here the voluminous details of Mrs. Clinton's longstanding alignment with the corporate, financial, and imperial agendas of the rich and powerful. Two short and highly readable volumes are Doug Henwood, My Turn: Hillary Clinton Targets the Presidency [OR Books, 2015]; Diana Johnstone, Queen of Chaos: The Misadventures of Hillary Clinton [CounterPunch Books, 2015]. On the stealth, virulent racism of the Clintons in power, see Elaine Brown's classic volume The Condemnation of Little B: New Age Racism in America [2003].)

What happened? Horrid corporate Hillary happened. And she's still happening. The "lying neoliberal warmonger" recently went to India to double down on her "progressive neoliberal" contempt for the "basket of deplorables" (more on that phrase below) that considers poor stupid and backwards middle America to be by saying this : "If you look at the map of the United States, there's all that red in the middle where Trump won. I win the coasts. But what the map doesn't show you is that I won the places that represent two-thirds of America's gross domestic product (GDP). So I won the places that are optimistic, diverse, dynamic, moving forward" (emphasis added).

That was Hillary Goldman Sachs-Council on Foreign Relations-Clinton saying "go to Hell" to working- and middle-class people in Iowa, Wisconsin, Pennsylvania, Ohio, Michigan, Missouri, Indiana, and West Virginia. It was a raised middle and oligarchic finger from a super-wealthy arch-global-corporatist to all the supposedly pessimistic, slow-witted, and retrograde losers stuck between those glorious enclaves (led by Wall Street, Yale, and Harvard on the East coast and Silicon Valley and Hollywood on the West coast) of human progress and variety (and GDP!) on the imperial shorelines. Senate Minority Leader Dick Durbin had to go on television to say that Hillary was "wrong" to write off most of the nation as a festering cesspool of pathetic, ass-backwards, lottery-playing, and opioid-addicted white-trash has-beens. It's hard for the Inauthentic Opposition Party (as the late Sheldon Wolin reasonably called the Democrats ) to pose as an authentic opposition party when its' last big-money presidential candidate goes off-fake-progressive script with an openly elitist rant like that.

Historic Mistakes

Whatever the source of her strange policy silence in the 2016 campaign, that hush was "a miscalculation of historic proportion" (FJC). It was a critical mistake given what Ferguson and his colleagues call the "Hunger Games" misery and insecurity imposed on tens of millions of ordinary working- and middle-class middle-Americans by decades of neoliberal capitalist austerity , deeply exacerbated by the Wall Street-instigated Great Recession and the weak Obama recovery. The electorate was in a populist, anti-establishment mood – hardly a state of mind favorable to a wooden, richly globalist, Goldman-gilded candidate, a long-time Washington-Wall Street establishment ("swamp") creature like Hillary Clinton.

In the end, FJC note, the billionaire Trump's ironic, fake-populist "outreach to blue collar workers" would help him win "more than half of all voters with a high school education or less (including 61% of white women with no college), almost two thirds of those who believed life for the next generation of Americans would be worse than now, and seventy-seven percent of voters who reported their personal financial situation had worsened since four years ago."

Trump's popularity with "heartland" rural and working-class whites even provoked Hillary into a major campaign mistake: getting caught on video telling elite Manhattan election investors that half of Trump's supporters were a "basket of deplorables." There was a hauntingly strong parallel between Wall Street Hillary's "deplorables" blooper and the super-rich Republican candidate Mitt Romney's infamous 2012 gaffe : telling his own affluent backers saying that 47% of the population were a bunch of lazy welfare cheats. This time, though, it was the Democrat – with a campaign finance profile closer to Romney's than Obama's in 2012 – and not the Republican making the ugly plutocratic and establishment faux pas .

"A Frontal Assault on the American Establishment"

Still, Trump's success was no less tied to big money than was Hillary's failure. Candidate Trump ran strangely outside the longstanding neoliberal Washington Consensus, as an economic nationalist and isolationist. His raucous rallies were laced with dripping denunciations of Wall Street, Goldman Sachs, and globalization, mockery of George W. Bush's invasion of Iraq, rejection of the New Cold War with Russia, and pledges of allegiance to the "forgotten" American "working-class." He was no normal Republican One Percent candidate. As FJC explain:

"In 2016 the Republicans nominated yet another super-rich candidate – indeed, someone on the Forbes 400 list of wealthiest Americans. Like legions of conservative Republicans before him, he trash-talked Hispanics, immigrants, and women virtually non-stop, though with a verve uniquely his own. He laced his campaign with barely coded racial appeals and in the final days, ran an ad widely denounced as subtly anti-Semitic. But in striking contrast to every other Republican presidential nominee since 1936, he attacked globalization, free trade, international financiers, Wall Street, and even Goldman Sachs. ' Globalization has made the financial elite who donate to politicians very wealthy. But it has left millions of our workers with nothing but poverty and heartache . When subsidized foreign steel is dumped into our markets, threatening our factories, the politicians do nothing. For years, they watched on the sidelines as our jobs vanished and our communities were plunged into depression-level unemployment.'"

"In a frontal assault on the American establishment, the Republican standard bearer proclaimed 'America First.' Mocking the Bush administration's appeal to 'weapons of mass destruction' as a pretext for invading Iraq, he broke dramatically with two generations of GOP orthodoxy and spoke out in favor of more cooperation with Russia . He even criticized the 'carried interest' tax break beloved by high finance" (emphasis added).

Big Dark Money and Trump: His Own and Others'

This cost Trump much of the corporate and Wall Street financial support that Republican presidential candidates usually get. The thing was, however, that much of Trump's "populist" rhetoric was popular with a big part of the Republican electorate, thanks to the "Hunger Games" insecurity of the transparently bipartisan New Gilded Age. And Trump's personal fortune permitted him to tap that popular anger while leaping insultingly over the heads of his less wealthy if corporate and Wall Street-backed competitors ("low energy" Jeb Bush and "little Marco" Rubio most notably) in the crowded Republican primary race.

A Republican candidate dependent on the usual elite bankrollers would never have been able to get away with Trump's crowd-pleasing (and CNN and FOX News rating-boosting) antics. Thanks to his own wealth, the faux-populist anti-establishment Trump was ironically inoculated against pre-emption in the Republican primaries by the American campaign finance "wealth primary," which renders electorally unviable candidates who lack vast financial resources or access to them.

Things were different after Trump won the Republican nomination, however. He could no longer go it alone after the primaries. During the Republican National Convention and "then again in the late summer of 2016," FJC show, Trump's "solo campaign had to be rescued by major industries plainly hoping for tariff relief, waves of other billionaires from the far, far right of the already far right Republican Party, and the most disruption-exalting corners of Wall Street." By FJC's account:

"What happened in the final weeks of the campaign was extraordinary. Firstly, a giant wave of dark money poured into Trump's own campaign – one that towered over anything in 2016 or even Mitt Romney's munificently financed 2012 effort – to say nothing of any Russian Facebook experiments [Then] another gigantic wave of money flowed in from alarmed business interests, including the Kochs and their allies Officially the money was for Senate races, but late-stage campaigning for down-ballot offices often spills over on to candidates for the party at large."

"The run up to the Convention brought in substantial new money, including, for the first time, significant contributions from big business. Mining, especially coal mining; Big Pharma (which was certainly worried by tough talk from the Democrats, including Hillary Clinton, about regulating drug prices); tobacco, chemical companies, and oil (including substantial sums from executives at Chevron, Exxon, and many medium sized firms); and telecommunications (notably AT&T, which had a major merge merger pending) all weighed in. Money from executives at the big banks also began streaming in, including Bank of America, J. P. Morgan Chase, Morgan Stanley, and Wells Fargo. Parts of Silicon Valley also started coming in from the cold."

"In a harbinger of things to come, additional money came from firms and industries that appear to have been attracted by Trump's talk of tariffs, including steel and companies making machinery of various types [a] vast wave of new money flowed into the campaign from some of America's biggest businesses and most famous investors. Sheldon Adelson and many others in the casino industry delivered in grand style for its old colleague. Adelson now delivered more than $11 million in his own name, while his wife and other employees of his Las Vegas Sands casino gave another $20 million.

Peter Theil contributed more than a million dollars, while large sums also rolled in from other parts of Silicon Valley, including almost two million dollars from executives at Microsoft and just over two million from executives at Cisco Systems. A wave of new money swept in from large private equity firms, the part of Wall Street which had long championed hostile takeovers as a way of disciplining what they mocked as bloated and inefficient 'big business.' Virtual pariahs to main-line firms in the Business Roundtable and the rest of Wall Street, some of these figures had actually gotten their start working with Drexel Burnham Lambert and that firm's dominant partner, Michael Milkin.

Among those were Nelson Peltz and Carl Icahn (who had both contributed to Trump before, but now made much bigger new contributions). In the end, along with oil, chemicals, mining and a handful of other industries, large private equity firms would become one of the few segments of American business – and the only part of Wall Street – where support for Trump was truly heavy the sudden influx of money from private equity and hedge funds clearly began with the Convention but turned into a torrent "

The critical late wave came after Trump moved to rescue his flagging campaign by handing its direction over to the clever, class-attuned, far-right white- and economic- nationalist "populist" and Breitbart executive Steve Bannon, who advocated what proved to be a winning, Koch brothers-approved "populist" strategy: appeal to economically and culturally frustrated working- and middle-class whites in key battleground states, where the bloodless neoliberal and professional class centrism and snooty metropolitan multiculturalism of the Obama presidency and Clinton campaign was certain to depress the Democratic "base" vote . Along with the racist voter suppression carried out by Republican state governments (JFC rightly chide Russia-obsessed political reporters and commentators for absurdly ignoring this important factor) and (JFC intriguingly suggest) major anti-union offensives conducted by employers in some battleground states, this major late-season influx of big right-wing political money tilted the election Trump's way.

The Myth of Potent Russian Cyber-Subversion

As FJC show, there is little empirical evidence to support the Clinton and corporate Democrats' self-interested and diversionary efforts to explain Mrs. Clinton's epic fail and Trump's jaw-dropping upset victory as the result of (i) Russian interference, (ii), then FBI Director James Comey's October Surprise revelation that his agency was not done investigating Hillary's emails, and/or (iii) some imagined big wave of white working-class racism, nativism, and sexism brought to the surface by the noxious Orange Hulk. The impacts of both (i) and (ii) were infinitesimal in comparison to the role that big campaign money played both in silencing Hillary and funding Trump.

The blame-the-deplorable-racist-white-working-class narrative is belied by basic underlying continuities in white working class voting patterns. As FJC note: " Neither turnout nor the partisan division of the vote at any level looks all that different from other recent elections 2016's alterations in voting behavior are so minute that the pattern is only barely differentiated from 2012." It was about the money – the big establishment money that the Clinton campaign took (as FJC at least plausibly argue) to recommend policy silence and the different, right-wing big money that approved Trump's comparative right-populist policy boisterousness.

An interesting part of FJC's study (no quick or easy read) takes a close look at the pro-Trump and anti-Hillary Internet activism that the Democrats and their many corporate media allies are so insistently eager to blame on Russia and for Hillary's defeat. FJC find that Russian Internet interventions were of tiny significance compared to those of homegrown U.S. corporate and right-wing cyber forces:

"The real masters of these black arts are American or Anglo-American firms. These compete directly with Silicon Valley and leading advertising firms for programmers and personnel. They rely almost entirely on data purchased from Google, Facebook, or other suppliers, not Russia . American regulators do next to nothing to protect the privacy of voters and citizens, and, as we have shown in several studies, leading telecom firms are major political actors and giant political contributors. As a result, data on the habits and preferences of individual internet users are commercially available in astounding detail and quantities for relatively modest prices – even details of individual credit card purchases. The American giants for sure harbor abundant data on the constellation of bots, I.P. addresses, and messages that streamed to the electorate "

" stories hyping 'the sophistication of an influence campaign slickly crafted to mimic and infiltrate U.S. political discourse while also seeking to heighten tensions between groups already wary of one another by the Russians miss the mark.' By 2016, the Republican right had developed internet outreach and political advertising into a fine art and on a massive scale quite on its own. Large numbers of conservative websites, including many that that tolerated or actively encouraged white supremacy and contempt for immigrants, African-Americans, Hispanics, Jews, or the aspirations of women had been hard at work for years stoking up 'tensions between groups already wary of one another.' Breitbart and other organizations were in fact going global, opening offices abroad and establishing contacts with like-minded groups elsewhere. Whatever the Russians were up to, they could hardly hope to add much value to the vast Made in America bombardment already underway. Nobody sows chaos like Breitbart or the Drudge Report ."

" the evidence revealed thus far does not support strong claims about the likely success of Russian efforts, though of course the public outrage at outside meddling is easy to understand. The speculative character of many accounts even in the mainstream media is obvious. Several, such as widely circulated declaration by the Department of Homeland Security that 21 state election systems had been hacked during the election, have collapsed within days of being put forward when state electoral officials strongly disputed them, though some mainstream press accounts continue to repeat them. Other tales about Macedonian troll factories churning out stories at the instigation of the Kremlin, are clearly exaggerated."

The Sanders Tease: "He Couldn't Have Done a Thing"

Perhaps the most remarkable finding in FJC's study is that Sanders came tantalizingly close to winning the Democratic presidential nomination against the corporately super-funded Clinton campaign with no support from Big Business . Running explicitly against the "Hunger Games" economy and the corporate-financial plutocracy that created it, Sanders pushed Hillary the Goldman candidate to the wall, calling out the Democrats' capture by Wall Street, forcing her to rely on a rigged party, convention, and primary system to defeat him. The small-donor "socialist" Sanders challenge represented something Ferguson and his colleagues describe as "without precedent in American politics not just since the New Deal, but across virtually the whole of American history a major presidential candidate waging a strong, highly competitive campaign whose support from big business is essentially zero ."

Sanders pulled this off, FJC might have added, by running in (imagine) accord with majority-progressive left-of-center U.S. public opinion. But for the Clintons' corrupt advance- control of the Democratic National Committee and convention delegates, Ferguson et al might further have noted, Sanders might well have been the Democratic presidential nominee, curiously enough in the arch-state-capitalist and oligarchic United States

Could Sanders have defeated the billionaire and right-wing billionaire-backed Trump in the general election? There's no way to know, of course. Sanders consistently out-performed Hillary Clinton in one-on-one match -up polls vis a vis Donald Trump during the primary season, but much of the big money (and, perhaps much of the corporate media) that backed Hillary would have gone over to Trump had the supposedly "radical" Sanders been the Democratic nominee.

Even if Sanders has been elected president, moreover, Noam Chomsky is certainly correct in his recent judgement that Sanders would have been able to achieve very little in the White House. As Chomsky told Lynn Parramore two weeks ago, in an interview conducted for the Institute for New Economic Thinking, the same think-tank that published FJC's remarkable study:

"His campaign [was] a break with over a century of American political history. No corporate support, no financial wealth, he was unknown, no media support. The media simply either ignored or denigrated him. And he came pretty close -- he probably could have won the nomination, maybe the election. But suppose he'd been elected? He couldn't have done a thing. Nobody in Congress, no governors, no legislatures, none of the big economic powers, which have an enormous effect on policy. All opposed to him. In order for him to do anything, he would have to have a substantial, functioning party apparatus, which would have to grow from the grass roots. It would have to be locally organized, it would have to operate at local levels, state levels, Congress, the bureaucracy -- you have to build the whole system from the bottom."

As Chomsky might have added, Sanders oligarchy-imposed "failures" would have been great fodder for the disparagement and smearing of "socialism" and progressive, majority-backed policy change. "See? We tried all that and it was a disaster!"

I would note further that the Sanders phenomenon's policy promise was plagued by its standard bearer's persistent loyalty to the giant and absurdly expensive U.S.-imperial Pentagon System, which each year eats up hundreds of billions of taxpayer dollars required to implement the progressive, majority-supported policy agenda that Bernie F-35 Sanders ran on.

"A Very Destructive Ideology"

The Sanders challenge was equally afflicted by its candidate-centered electoralism. This diverted energy away from the real and more urgent politics of building people's movements – grassroots power to shake the society to its foundations and change policy from the bottom up (Dr. Martin Luther King's preferred strategy at the end of his life just barely short of 50 years ago, on April 4 th , 1968) – and into the narrow, rigidly time-staggered grooves of a party and spectacle-elections crafted by and for the wealthy Few and the American Oligarchy 's "permanent political class" (historian Ron Formisano). As Chomsky explained on the eve of the 2004 elections:

"Americans may be encouraged to vote, but not to participate more meaningfully in the political arena. Essentially the election is a method of marginalizing the population. A huge propaganda campaign is mounted to get people to focus on these personalized quadrennial extravaganzas and to think, 'That's politics.' But it isn't. It's only a small part of politics The urgency is for popular progressive groups to grow and become strong enough so that centers of power can't ignore them. Forces for change that have come up from the grass roots and shaken the society to its core include the labor movement, the civil rights movement, the peace movement, the women's movement and others, cultivated by steady, dedicated work at all levels, every day, not just once every four years sensible [electoral] choices have to be made. But they are secondary to serious political action."

"The only thing that's going to ever bring about any meaningful change," Chomsky told Abby Martin on teleSur English in the fall of 2015, "is ongoing, dedicated, popular movements that don't pay attention to the election cycle." Under the American religion of voting, Chomsky told Dan Falcone and Saul Isaacson in the spring of 2016, "Citizenship means every four years you put a mark somewhere and you go home and let other guys run the world. It's a very destructive ideology basically, a way of making people passive, submissive objects [we] ought to teach kids that elections take place but that's not politics."

For all his talk of standing atop a great "movement" for "revolution," Sanders was and remains all about this stunted and crippling definition of citizenship and politics as making some marks on ballots and then returning to our domiciles while rich people and their agents (not just any "other guys") "run [ruin?-P.S.] the world [into the ground-P.S.]."

It will take much more in the way of Dr. King's politics of "who' sitting in the streets," not "who's sitting in the White House" (to use Howard Zinn's excellent dichotomy ), to get us an elections and party system worthy of passionate citizen engagement. We don't have such a system in the U.S. today, which is why the number of eligible voters who passively boycotted the 2016 presidential election is larger than both the number who voted for big money Hillary and the number who voted for big money Trump.

(If U.S. progressives really want to consider undertaking the epic lift involved in passing a U.S. Constitutional Amendment, they might want to focus on this instead of calling for a repeal of the Second Amendment. I'd recommend starting with a positive Democracy Amendment that fundamentally overhauls the nation's political and elections set-up in accord with elementary principles and practices of popular sovereignty. Clauses would include but not be limited to full public financing of elections and the introduction of proportional representation for legislative races – not to mention the abolition of the Electoral College, Senate apportionment on the basis of total state population, and the outlawing of gerrymandering.)

Ecocide Trumped by Russia

Meanwhile, back in real history, we have the remarkable continuation of a bizarre right-wing, pre-fascist presidency not in normal ruling-class hands, subject to the weird whims and tweets of a malignant narcissist who doesn't read memorandums or intelligence briefings. Wild policy zig-zags and record-setting White House personnel turnover are par for the course under the dodgy reign of the orange-tinted beast's latest brain spasms. Orange Caligula spends his mornings getting his information from FOX News and his evenings complaining to and seeking advice from a small club of right-wing American oligarchs.

Trump poses grave environmental and nuclear risks to human survival. A consistent Trump belief is that climate change is not a problem and that it's perfectly fine – "great" and "amazing," in fact – for the White House to do everything it can to escalate the Greenhouse Gassing-to-Death of Life on Earth. The nuclear threat is rising now that he has appointed a frothing right-wing uber-warmonger – a longtime advocate of bombing Iran and North Korea who led the charge for the arch-criminal U.S. invasion of Iraq – as his top "National Security" adviser and as he been convinced to expel dozens of Russian diplomats. Thanks, liberal and other Democratic Party RussiaGaters!

The Clinton-Obama neoliberal Democrats have spent more than a year running with the preposterous narrative that Trump is a Kremlin puppet who owes his presence in the White House to Russia's subversion of our democratic elections. The climate crisis holds little for the Trump and Russia-obsessed corporate media. The fact that the world stands at the eve of the ecological self-destruction, with the Trump White House in the lead, elicits barely a whisper in the reigning commercial news media. Unlike Stormy Daniels, for example, that little story – the biggest issue of our or any time – is not good for television ratings and newspaper sales.

Sanders, by the way, is curiously invisible in the dominant commercial media, despite his quiet survey status as the nation's "most popular politician." That is precisely what you would expect in a corporate and financial oligarchy buttressed by a powerful corporate, so-called "mainstream" media oligopoly.

Political Parties as "Bank Accounts"

One of the many problems with the obsessive Blame-Russia narrative that a fair portion of the dominant U.S. media is running with is that we had no great electoral democracy to subvert in 2016 . Saying that Russia has "undermined [U.S.-] American democracy" is like me – middle-aged, five-foot nine, and unblessed with jumping ability – saying that the Brooklyn Nets' Russian-born center Timofy Mozgof subverted my career as a starting player in the National Basketball Association. In state-capitalist societies marked by the toxic and interrelated combination of weak popular organization, expensive politics, and highly concentrated wealth – all highly evident in the New Gilded Age United States – electoral contests and outcomes boil down above all and in the end to big investor class cash. As Thomas Ferguson and his colleagues explain:

"Where investment and organization by average citizens is weak, however, power passes by default to major investor groups, which can far more easily bear the costs of contending for control of the state. In most modern market-dominated societies (those celebrated recently as enjoying the 'end of History'), levels of effective popular organization are generally low, while the costs of political action, in terms of both information and transactional obstacles, are high. The result is that conflicts within the business community normally dominate contests within and between political parties – the exact opposite of what many earlier social theorists expected, who imagined 'business' and 'labor' confronting each other in separate parties Only candidates and positions that can be financed can be presented to voters. As a result, in countries like the US and, increasingly, Western Europe, political parties are first of all bank accounts . With certain qualifications, one must pay to play. Understanding any given election, therefore, requires a financial X-ray of the power blocs that dominate the major parties, with both inter- and intra- industrial analysis of their constituent elements."

Here Ferguson might have said "corporate-dominated" instead of "market-dominated" for the modern managerial corporations emerged as the "visible hand" master of the "free market" more than a century ago.

We get to vote? Big deal.

People get to vote in Rwanda, Russia, the Congo and countless other autocratic states as well. Elections alone are no guarantee of democracy, as U.S. policymakers and pundits know very well when they rip on rigged elections (often fixed with the assistance of U.S. government and private-sector agents and firms) in countries they don't like, which includes any country that dares to "question the basic principle that the United States effectively owns the world by right and is by definition a force for good" ( Chomsky, 2016 ).

Majority opinion is regularly trumped by a deadly complex of forces in the U.S. The list of interrelated and mutually reinforcing culprits behind this oligarchic defeat of popular sentiment in the U.S. is extensive. It includes but is not limited to: the campaign finance, candidate-selection, lobbying, and policy agenda-setting power of wealthy individuals, corporations, and interest groups; the special primary election influence of full-time party activists; the disproportionately affluent, white, and older composition of the active (voting) electorate; the manipulation of voter turnout; the widespread dissemination of false, confusing, distracting, and misleading information; absurdly and explicitly unrepresentative political institutions like the Electoral College, the unelected Supreme Court, the over-representation of the predominantly white rural population in the U.S. Senate; one-party rule in the House of "Representatives"; the fragmentation of authority in government; and corporate ownership of the reigning media, which frames current events in accord with the wishes and world view of the nation's real owners.

Yes, we get to vote. Super. Big deal. Mammon reigns nonetheless in the United States, where, as the leading liberal political scientists Benjamin Page and Martin Gilens find , "government policy reflects the wishes of those with money, not the wishes of the millions of ordinary citizens who turn out every two years to choose among the preapproved, money-vetted candidates for federal office."

Trump is a bit of an anomaly – a sign of an elections and party system in crisis and an empire in decline. He wasn't pre-approved or vetted by the usual U.S. " deep state " corporate, financial, and imperial gatekeepers. The ruling-class had been trying to figure out what the Hell to do with him ever since he shocked even himself (though not Steve Bannon) by pre-empting the coronation of the "Queen of Chaos."

He is a homegrown capitalist oligarch nonetheless, a real estate mogul of vast and parasitic wealth who is no more likely to fulfill his populist-sounding campaign pledges than any previous POTUS of the neoliberal era.

His lethally racist, sexist, nativist, nuclear-weapons-brandishing, and (last but not at all least) eco-cidal rise to the nominal CEO position atop the U.S.-imperial oligarchy is no less a reflection of the dominant role of big U.S. capitalist money and homegrown plutocracy in U.S. politics than a more classically establishment Hillary ascendancy would have been. It's got little to do with Russia, Russia, Russia – the great diversion that fills U.S. political airwaves and newsprint as the world careens ever closer to oligarchy-imposed geocide and to a thermonuclear conflagration that the RussiaGate gambit is recklessly encouraging.

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Paul Street's latest book is They Rule: The 1% v. Democracy (Paradigm, 2014)

[Mar 11, 2018] Is Trump the New Clinton by Musa al-Gharbi

Notable quotes:
"... If Mueller's probe drags on and fails to produce a "smoking gun," the whole affair may end up seeming so complex, muddy, and partisan that most of the public would prefer to move on, eager to talk about something else . ..."
"... In 1996, Republican presidential nominee Bob Dole decided to take a hard line on China -- portraying the nation as a growing economic and geopolitical threat to the United States and a violator of international rules and norms. In response, China tried to leverage its extensive diplomatic , intelligence , and financial networks in the United States in order to sway the election in favor of Dole's rival, Democrat Bill Clinton. ..."
"... This is not a theory, it is historical fact: there was a major Congressional investigation . In the end, several prominent Democratic fundraisers, including close Clinton associates, were found to be complicit in the Chinese meddling efforts and pled guilty to various charges of violating campaign finance and disclosure laws (most notably James T. Riady , Johnny Chung , John Huang , and Charlie Trie ). Several others fled the country to escape U.S. jurisdiction as the probe got underway. The Democratic National Committee was forced to return millions of dollars in ill-gotten funds (although by that point, of course, their candidate had already won). ..."
"... Clinton authorized a series of controversial defense contracts with China as well -- despite Department of Justice objections . Federal investigators were concerned that the contractors seemed to be passing highly sensitive and classified information to the Chinese. And indeed, the companies in question were eventually found to have violated the law by giving cutting-edge missile technology to China, and paid unprecedented fines related to the Arms Export Control Act during the administration of George W. Bush. But they were inexplicably approved in the Bill Clinton years. ..."
Mar 11, 2018 | thebaffler.com

A president can be reelected despite corruption, foreign meddling, and sex scandals Bill Clinton was reelected with help from China. / The Baffler Imagine for a moment that special counsel Robert Mueller is unable to establish direct and intentional collusion between Russia and the Trump campaign. Or, suppose he proves collusion by a few former campaign aides but finds nothing directly implicating the president himself. In either event -- or in just about any other imaginable scenario -- it seems improbable that Congress will have the votes to impeach Trump or otherwise hold him accountable prior to 2020.

If Mueller's probe drags on and fails to produce a "smoking gun," the whole affair may end up seeming so complex, muddy, and partisan that most of the public would prefer to move on, eager to talk about something else .

In other words, Russiagate could well continue to distract and infuriate Trump without breaking his hold on power.

Is it shocking to think evidence of Russian chicanery could be shrugged off? Don't be shocked. After all, the last major case of foreign meddling and collusion in a U.S. presidential race didn't exactly end up rocking the republic.

In 1996, Republican presidential nominee Bob Dole decided to take a hard line on China -- portraying the nation as a growing economic and geopolitical threat to the United States and a violator of international rules and norms. In response, China tried to leverage its extensive diplomatic , intelligence , and financial networks in the United States in order to sway the election in favor of Dole's rival, Democrat Bill Clinton.

This is not a theory, it is historical fact: there was a major Congressional investigation . In the end, several prominent Democratic fundraisers, including close Clinton associates, were found to be complicit in the Chinese meddling efforts and pled guilty to various charges of violating campaign finance and disclosure laws (most notably James T. Riady , Johnny Chung , John Huang , and Charlie Trie ). Several others fled the country to escape U.S. jurisdiction as the probe got underway. The Democratic National Committee was forced to return millions of dollars in ill-gotten funds (although by that point, of course, their candidate had already won).

It was a scandal that persisted after the election in no small part because many of Clinton's own policies in his second term seemed to lend credence to insinuations of collusion.

Several prominent Democratic fundraisers, including close Clinton associates, were found to be complicit in Chinese meddling efforts and pled guilty to campaign finance violations.

Rather than attempting to punish the meddling country for undermining the bedrock of our democracy, Bill Clinton worked to ease sanctions and normalize relations with Beijing -- even as the U.S. ratcheted up sanctions against Cuba, Iran, and Iraq. By the end of his term, he signed a series of sweeping trade deals that radically expanded China's economic and geopolitical clout -- even though some in his administration forecast that this would come at the expense of key American industries and U.S. manufacturing workers.

Clinton authorized a series of controversial defense contracts with China as well -- despite Department of Justice objections . Federal investigators were concerned that the contractors seemed to be passing highly sensitive and classified information to the Chinese. And indeed, the companies in question were eventually found to have violated the law by giving cutting-edge missile technology to China, and paid unprecedented fines related to the Arms Export Control Act during the administration of George W. Bush. But they were inexplicably approved in the Bill Clinton years.

For a while, polls showed that the public found the president's posture on China to be so disconcerting that most supported appointing an independent counsel (a la Mueller) to investigate whether the Clinton Administration had essentially been " bought ."

Law enforcement officials shared these concerns: FBI director Louis Freeh (whom Clinton could not get rid of, having just fired his predecessor ) publically called for the appointment of an independent counsel. So did the chief prosecutor charged with investigating Chinese meddling, Charles La Bella . However, they were blocked at every turn by Clinton's Attorney General, Janet Reno -- eventually leading La Bella to resign in protest of the AG's apparent obstruction.

The 1996 Chinese collusion story, much like the 2016 Russian collusion story, dragged on for nearly two years -- hounding Clinton at every turn. That is, until it was discovered that the president had been having an affair with White House intern Monica Lewinsky.

The 1996 Chinese collusion story dragged on for nearly two years -- hounding Clinton at every turn. That is, until the Monica Lewinsky scandal came along.

This was Bill Clinton's second known extra-marital affair with a subordinate : in the lead-up to his 1992 election it was also discovered that Clinton had been involved in a long-running affair with Gennifer Flowers -- an employee of the State of Arkansas during Bill's governorship there, appointed as a result of Clinton's intercession on her behalf.

The drama of the inquiry into Bill Clinton's myriad alleged sexual improprieties, the President's invocation of executive privilege to prevent his aides from having to testify against him, Clinton's perjury , subsequent impeachment by the House, acquittal in the Senate, and eventual plea-bargain deal -- these sucked the oxygen away from virtually all other stories related to the president.

Indeed, few today seem to remember that the Chinese meddling occurred at all. This despite continuing China-related financial improprieties involving both the Clintons and the DNC Chairman who presided over the 1996 debacle, Terry McAuliffe -- and despite the fact that the intended target of the current foreign meddling attempt just so happens to be married to the intended beneficiary of the last.

And the irony in this, of course, is that not only do we find ourselves reliving an apparently ill-fated collusion investigation, but the foreign meddling story is once again competing with a presidential sex scandal -- this time involving actual porn stars. (Gennifer Flowers and Paula Jones both posed for Penthouse after their involvement with Clinton surfaced. Stormy Daniels and Karen McDougal are well-established in the industry.)

Much like Bill Clinton, our current president has a long pattern of accusations of infidelity, sexual harassment and even assault. However all of Trump's alleged sexual misconduct incidents occurred before he'd assumed any public office. Therefore, although some Democrats hope to provide Trump's accusers an opportunity to testify before Congress if their party manages to retake the House in 2018, the legal impact of these accounts is likely to be nil. The political significance of such theater is likely being overestimated as well.


The danger for Democrats in all this is that they could get lulled into the notion that Trump's liabilities -- the Mueller probe, the alleged affairs, and whatever new scandals and outrages Trump generates in the next two years -- will be sufficient to energize and mobilize their base in 2020. Democratic insiders and fatcats are likely to think they can put forward the same sort of unpalatable candidate and platform they did last cycle -- only this time, they'll win! A strong showing in 2018 could even reinforce this sense of complacency -- leading to another debacle in the race for the White House in 2020.

Democrats consistently snatch defeat from the jaws of victory by believing they've got some kind of lock. Remember the " Emerging Democratic Majority " thesis? Remember Hillary Clinton's alleged 2016 " Electoral Firewall ?" What have the Democrats learned from 2016? The answer is, very little if they believe the essential problem was just James Comey and the Russians.

Here's one lesson Democrats would do well to internalize:

The party has won by running charismatic people against Republican cornflake candidates (see Clinton v. Bush I or Dole, or Obama v. McCain or Romney). Yet whenever Democrats find themselves squaring off against a faux-populist who plays to voters' base instincts, the party always make the same move: running a wonky technocrat with an impressive resume, detailed policy proposals, and little else.

Does it succeed in drawing a sharp contrast? Pretty much always. Does it succeed at winning the White House? Pretty much never: Mondale, Dukakis, Gore, Kerry, and now Clinton.

Democrats could be headed for trouble if they are counting on the Mueller investigation to bring Trump down.

Democrats rely heavily on irregular voters to win elections; negative partisanship races tend to depress turnout for these constituents. More broadly, if left with a choice between a "lesser of two evils" the public tends to stick with the "devil they know." In short: precisely what Democrats don't need in 2020 is a negative partisanship race.

A referendum on Trump might not play out the way Democrats expect. Against all odds, it looks like the president will even have an actual record to run on . He should not be underestimated.

Clinton-style triangulation is also likely to backfire. Contemporary research suggests there just aren't a lot of " floating voters " up for grabs these days. Rather than winning over disaffected Republicans, this approach would likely just alienate the Democratic base.

The party's best bet is to instead focus on mobilizing the left by articulating a compelling positive message for why Americans should vote for them (rather than just against Trump). They will need to respond to Trump with a populist of their own -- someone who can credibly appeal to people in former Obama districts that Hillary Clinton lost . And they need to activate those who sat the last election out -- for instance by delivering for elements of their base that the party has largely taken for granted in recent cycles.

If the Democratic National Committee wants to spend its time talking about Russia and sex scandals instead of tending to these priorities, then we should all brace for another humiliating "black swan" defeat for the party in 2020.

But, you say, isn't Trump the least popular president ever after one year in office? Guess whose year-one (un)popularity is closest to Trump's? Ronald Reagan. He was under 50 percent in approval ratings at the end of his first year; but he went on to win reelection in an historic landslide. Barack Obama was barely breaking even after year one but won reelection comfortably. Bill Clinton was only slightly above 50 percent after his first year.

You know who else had the lowest approval rating in a quarter-century after Trump's first year in office? The Democratic Party.

Musa al-Gharbi is a Paul F. Lazarsfeld Fellow in Sociology at Columbia University. Readers can connect to his research and social media via his website .

[Jan 20, 2018] What Is The Democratic Party ? by Lambert Strether

Highly recommended!
"Institutionally, the Democratic Party Is Not Democratic"
Very apt characterization "the Democratic Party is nothing more than a layer of indirection between the donor class and the Democratic consultants and the campaigns they run;" ... " after all, the Democratic Party -- in its current incarnation -- has important roles to play in not expanding its "own" electorate through voter registration, in the care and feeding of the intelligence community, in warmongering, in the continual buffing and polishing of neoliberal ideology, and in general keeping the Overton Window firmly nailed in place against policies that would convey universal concrete material benefits, especially to the working class"
Notable quotes:
"... That said, the revivification of the DNC lawsuit serves as a story hook for me to try to advance the story on the nature of political parties as such, the Democratic Party as an institution, and the function that the Democratic Party serves. I will meander through those three topics, then, and conclude. ..."
"... What sort of legal entity is ..."
"... Political parties were purely private organizations from the 1790s until the Civil War. Thus, "it was no more illegal to commit fraud in the party caucus or primary than it would be to do so in the election of officers of a drinking club." However, due to the efforts of Robert La Follette and the Progressives, states began to treat political parties as "public agencies" during the early 1890s and 1900s; by the 1920s "most states had adopted a succession of mandatory statutes regulating every major aspect of the parties' structures and operations. ..."
"... While 1787 delegates disagreed on when corruption might occur, they brought a general shared understanding of what political corruption meant. To the delegates, political corruption referred to self-serving use of public power for private ends, including, without limitation, bribery, public decisions to serve private wealth made because of dependent relationships, public decisions to serve executive power made because of dependent relationships, and use by public officials of their positions of power to become wealthy. ..."
"... Two features of the definitional framework of corruption at the time deserve special attention, because they are not frequently articulated by all modern academics or judges. The first feature is that corruption was defined in terms of an attitude toward public service, not in relation to a set of criminal laws. The second feature is that citizenship was understood to be a public office. The delegates believed that non-elected citizens wielding or attempting to influence public power can be corrupt and that elite corruption is a serious threat to a polity. ..."
"... You can see how a political party -- a strange, amphibious creature, public one moment, private the next -- is virtually optimized to create a phishing equilibrium for corruption. However, I didn't really answer my question, did I? I still don't know what sort of legal entity the Democratic Party is. However, I can say what the Democratic Party is not ..."
"... So the purpose of superdelegates is to veto a popular choice, if they decide the popular choice "can't govern." But this is circular. Do you think for a moment that the Clintonites would have tried to make sure President Sanders couldn't have governed? You bet they would have, and from Day One. ..."
"... More importantly, you can bet that the number of superdelegates retained is enough for the superdelegates, as a class, to maintain their death grip on the party. ..."
"... could have voluntarily decided that, Look, we're gonna go into back rooms like they used to and smoke cigars and pick the candidate that way. ..."
"... That's exactly ..."
"... Functionally, the Democratic Party Is a Money Trough for Self-Dealing Consultants. Here once again is Nomiki Konst's amazing video, before the DNC: https://www.youtube.com/embed/EAvblBnXV-w Those millions! That's real money! ..."
"... Today, it is openly acknowledged by many members that the DNC and the Clinton campaign were running an operation together. In fact, it doesn't take much research beyond FEC filings to see that six of the top major consulting firms had simultaneous contracts with the DNC and HRC  --  collectively earning over $335 million since 2015 [this figure balloons in Konst's video because she got a look at the actual budget]. (This does not include SuperPACs.) ..."
"... One firm, GMMB earned $236.3 million from HFA and $5.3 from the DNC in 2016. Joel Benenson, a pollster and strategist who frequents cable news, collected $4.1m from HFA while simultaneously earning $3.3 million from the DNC. Perkins Coie law firm collected $3.8 million from the DNC, $481,979 from the Convention fund and $1.8 million from HFA in 2016. ..."
"... It gets worse. Not only do the DNC's favored consultants pick sides in the primaries, they serve on the DNC boards so they can give themselves donor money. ..."
"... These campaign consultants make a lot more money off of TV and mail than they do off of field efforts. Field efforts are long-term, labor-intensive, high overhead expenditures that do not have big margins from which the consultants can draw their payouts. They also don't allow the consultants to make money off of multiple campaigns all in the same cycle, while media and mail campaigns can be done from their DC office for dozens of clients all at the same time. They get paid whether campaigns win or lose, so effectiveness is irrelevant to them. ..."
"... the Democratic Party is nothing more than a layer of indirection between the donor class and the Democratic consultants and the campaigns they run; ..."
"... the Democratic Party -- in its current incarnation -- has important roles to play in not expanding its "own" electorate through voter registration, in the care and feeding of the intelligence community, in warmongering, in the continual buffing and polishing of neoliberal ideology, and in general keeping the Overton Window firmly nailed in place against policies that would convey universal concrete material benefits, especially to the working class. ..."
"... the bottom line is that if Democratic Party controls ballot access for the forseeable future, they have to be gone through ..."
"... In retrospect, despite Sanders evident appeal and the power of his list, I think it would have been best if their faction's pushback had been much stronger ..."
Jan 15, 2018 | www.nakedcapitalism.com

An alert reader who is a representative of the class that's suing the DNC Services Corporation for fraud in the 2016 Democratic primary -- WILDING et al. v. DNC SERVICES CORPORATION et al., a.k.a. the "DNC lawsuit" -- threw some interesting mail over the transom; it's from Elizabeth Beck of Beck & Lee, the firm that brought the case on behalf of the (putatively) defrauded class (and hence their lawyer). Beck's letter reads in relevant part:

... ... ...

[Jan 05, 2018] FBI launches new Clinton Foundation investigation

Jan 05, 2018 | thehill.com

The Justice Department has launched a new inquiry into whether the Clinton Foundation engaged in any pay-to-play politics or other illegal activities while Hillary Clinton served as Secretary of State, law enforcement officials and a witness tells The Hill.

FBI agents from Little Rock, Ark., where the Foundation was started, have taken the lead in the investigation and have interviewed at least one witness in the last month, and law enforcement officials said additional activities are expected in coming weeks.

The officials, who spoke only on condition of anonymity, said the probe is examining whether the Clintons promised or performed any policy favors in return for largesse to their charitable efforts or whether donors made commitments of donations in hopes of securing government outcomes.

The probe may also examine whether any tax-exempt assets were converted for personal or political use and whether the Foundation complied with applicable tax laws, the officials said.

... ... ...

One challenge for any Clinton-era investigation is that the statute of limitations on most federal felonies is five years and Clinton left office in early 2013.

[Dec 12, 2017] Thoughts on Neoconservatism and Neoliberalism by Hugh

Highly recommended!
Notable quotes:
"... I got to thinking today about how neocon and neoliberal are becoming interchangeable terms. ..."
"... As neoconservatism developed, that is with Iraq and Afghanistan, the neocons even came to embrace nation building which had always been anathema to traditional conservatism. Neocons sold this primarily by casting nation building in military terms, the creation and training of police and security forces in the target country. ..."
"... 9/11 too was critical. It vastly increased the scope of the neocon project in spawning the Global War on Terror. It increased the stage of neocon operations to the entire planet. ..."
"... Politically, neoconservatism has become the bipartisan foreign policy consensus. Democrats are every bit as neocon in their views as Republicans. Only a few libertarians on the right and progressives on the left reject it. ..."
"... The roots of neoliberalism are the roots of kleptocracy. Both begin under Carter. Neoliberalism also known at various times and places as the Washington Consensus (under Clinton) and the Chicago School is the political expression for public consumption of the kleptocratic economic philosophy, just as libertarian and neoclassical economics (both fresh and salt water varieties) are its academic and governmental face. The central tenets of neoliberalism are deregulation, free markets, and free trade. If neoliberalism had a prophet or a patron saint, it was Milton Friedman. ..."
"... Again just as neoconservatism and kleptocracy or bipartisan so too is neoliberalism. There really is no daylight between Reaganism/supply side economics/trickledown on the Republican side and Clinton's Washington Consensus or Team Obama on the other. ..."
"... The distinctions between neoconservatism and neoliberalism are being increasingly lost, perhaps because most of our political classes are practitioners of both. ..."
"... At the same time, neoliberalism went from domestic to global, and here I am not just thinking about neoliberal experiments, like Pinochet's Chile or post-Soviet Russia, but the financialization of the world economy and the adoption of kleptocracy as the world economic model. ..."
"... I'm now under the opinion that you can't talk about any of the "neo-isms" without talking about the corporate state. ..."
"... With neocons, it manifests itself through the military-industrial complex (Boeing, Raytheon, etc.), and with neolibs it manifests itself through finance and industrial policy. ..."
"... But each leg has two components, a statist component and a corporate component. ..."
"... It also explains why economic/financial interests (neolib) are now considered national security interests (neocon). The viability of the state is now tied to the viability of the corporation. ..."
"... Corporate/statist (not sure "corporate" captures the looting/rentier aspect though). We see it everywhere, for example in the revolving door. ..."
"... I think you could also make the argument that Obama is perhaps the most ideal combination of neolib & neocon. ..."
"... A reading of the classical liberal economists puts some breaks on the markets, corporations, etc. Neoliberalism goes to the illogical extremes of market theory and iirc, has some influence from the Austrian school ... which gives up on any pretense of scientific exposition of economics or rationality at the micro level, assuming that irrationality will magically become rational behavior in aggregate. ..."
"... Therefore, US conservatives post Eisenhower but especially post Reagan are almost certainly economic neoliberals. Since Clinton, liberals/Democrats have been too (at least the elected ones). You nailed neoconservative and both parties are in foreign policy since at least Clinton ... though here lets not forget to go back as far as JFK and his extreme anti-Communism that led to all sorts of covert operations, The Bay of Pigs, Vietnam, and the Cuban Missile Crisis. Remember, the Soviets put the missiles in Cuba because we put missiles in Turkey and they backed down from Cuba because we agreed to remove the missiles from Turkey; Nikita was nice enough not to talk about that so that Kennedy didn't lose face. ..."
"... Perhaps it should be pointed out that the Clintons became fabulously wealthy just after Bill left office, mostly on the strength of his speaking engagements for the financial sector that he'd just deregulated. ..."
"... The unfortunate fact of the matter is that at that level of politics, the levers of money and power work equally well on both party's nomenklatura. They flock to it like moths to porch light. ..."
"... "Don't believe them, don't fear them, don't ask anything of them" - Aleksandr Solzhenitsyn ..."
Aug 19, 2012 | Corrente

I got to thinking today about how neocon and neoliberal are becoming interchangeable terms. They did not start out that way. My understanding is they are ways of rationalizing breaks with traditional conservatism and liberalism. Standard conservatism was fairly isolationist. Conservatism's embrace of the Cold War put it at odds with this tendency. This was partially resolved by accepting the Cold War as a military necessity despite its international commitments but limiting civilian programs like foreign aid outside this context and rejecting the concept of nation building altogether.

With the end of the Cold War conservative internationalism needed a new rationale, and this was supplied by the neoconservatives. They advocated the adoption of conservatism's Cold War military centered internationalism as the model for America's post-Cold War international relations. After all, why drop a winning strategy? America had won the Cold War against a much more formidable opponent than any left on the planet. What could go wrong?

America's ability not simply to project but its willingness to use military power was equated with its power more generally. If America did not do this, it was weak and in decline. However, the frequent use of military power showed that America was great and remained the world's hegemon. In particular, the neocons focused on the Middle East. This sales pitch gained them the backing of both supporters of Israel (because neoconservatism was unabashedly pro-Israel) and the oil companies. The military industrial complex was also on board because the neocon agenda effectively countered calls to reduce military spending. But neoconservatism was not just confined to these groups. It appealed to both believers in American exceptionalism and backers of humanitarian interventions (of which I once was one).

As neoconservatism developed, that is with Iraq and Afghanistan, the neocons even came to embrace nation building which had always been anathema to traditional conservatism. Neocons sold this primarily by casting nation building in military terms, the creation and training of police and security forces in the target country.

9/11 too was critical. It vastly increased the scope of the neocon project in spawning the Global War on Terror. It increased the stage of neocon operations to the entire planet. It effectively erased the distinction between the use of military force against countries and individuals. Individuals more than countries became targets for military, not police, action. And unlike traditional wars or the Cold War itself, this one would never be over. Neoconservatism now had a permanent raison d'être.

Politically, neoconservatism has become the bipartisan foreign policy consensus. Democrats are every bit as neocon in their views as Republicans. Only a few libertarians on the right and progressives on the left reject it.

Neoliberalism, for its part, came about to address the concern of liberals, especially Democrats, that they were too anti-business and too pro-union, and that this was hurting them at the polls. It was sold to the rubiat as pragmatism.

The roots of neoliberalism are the roots of kleptocracy. Both begin under Carter. Neoliberalism also known at various times and places as the Washington Consensus (under Clinton) and the Chicago School is the political expression for public consumption of the kleptocratic economic philosophy, just as libertarian and neoclassical economics (both fresh and salt water varieties) are its academic and governmental face. The central tenets of neoliberalism are deregulation, free markets, and free trade. If neoliberalism had a prophet or a patron saint, it was Milton Friedman.

Again just as neoconservatism and kleptocracy or bipartisan so too is neoliberalism. There really is no daylight between Reaganism/supply side economics/trickledown on the Republican side and Clinton's Washington Consensus or Team Obama on the other.

And just as we saw with neoconservatism, neoliberalism expanded from its core premises and effortlessly transitioned into globalization, which can also be understood as global kleptocracy.

The distinctions between neoconservatism and neoliberalism are being increasingly lost, perhaps because most of our political classes are practitioners of both. But initially at least neoconservatism was focused on foreign policy and neoliberalism on domestic economic policy. As the War on Terror expanded, however, neoconservatism came back home with the creation and expansion of the surveillance state.

At the same time, neoliberalism went from domestic to global, and here I am not just thinking about neoliberal experiments, like Pinochet's Chile or post-Soviet Russia, but the financialization of the world economy and the adoption of kleptocracy as the world economic model.

jest on Mon, 08/20/2012 - 5:55am

I'm now under the opinion that you can't talk about any of the "neo-isms" without talking about the corporate state.

That's really the tie that binds the two things you are speaking of.

With neocons, it manifests itself through the military-industrial complex (Boeing, Raytheon, etc.), and with neolibs it manifests itself through finance and industrial policy.

For example, you need the US gov't to bomb Iraq (Raytheon) in order to secure oil (Halliburton), which is priced & financed in US dollars (Goldman Sachs). It's like a 3-legged stool; if you remove one of these legs, the whole thing comes down. But each leg has two components, a statist component and a corporate component.

The entity that enables all of this is the corporate state.

It also explains why economic/financial interests (neolib) are now considered national security interests (neocon). The viability of the state is now tied to the viability of the corporation.

lambert on Mon, 08/20/2012 - 9:18am

Corporate/statist (not sure "corporate" captures the looting/rentier aspect though). We see it everywhere, for example in the revolving door.

I think the stool has more legs and is also more dynamic; more like Ikea furniture. For example, the press is surely critical in organizing the war.

But the yin/yang of neo-lib/neo-con is nice: It's as if the neo-cons handle the kinetic aspects (guns, torture) and the neo-libs handle the mental aspects (money, mindfuckery) but both merge (like Negronponte being on the board of Americans Select) over time as margins fall and decorative aspects like democratic institutions and academic freedom get stripped away. The state and the corporation have always been tied to each other but now the ties are open and visible (for example, fines are just a cost of doing business, a rent on open corruption.)

And then there's the concept of "human resource," that abstracts all aspects of humanity away except those that are exploitable.

First they ignore you, then they ridicule you, then they fight you, then you win. -- Mahatma Gandhi

jest on Mon, 08/20/2012 - 1:37pm

I like the term much better than Fascist, as it is 1) more accurate, 2) avoids the Godwin's law issue, and 3) makes them sound totalitarianist.

Yes, I would agree that additional legs make sense. The media aspect is essential, as it neutralizes the freedom of the press, without changing the constitution. It dovetails pretty well with the notion of Inverted Totalitarianism.

I think you could also make the argument that Obama is perhaps the most ideal combination of neolib & neocon. The two sides of him flow together so seamlessly, no one seems to notice. But that's in part because he is so corporate.

Lex on Mon, 08/20/2012 - 8:28am

Actually, neoliberalism is an economic term. An economic liberal in the UK and EU is for open markets, capitalism, etc. You're right that neoliberalism comes heavily from the University of Chicago, but it has little to do with American political liberalism.

A reading of the classical liberal economists puts some breaks on the markets, corporations, etc. Neoliberalism goes to the illogical extremes of market theory and iirc, has some influence from the Austrian school ... which gives up on any pretense of scientific exposition of economics or rationality at the micro level, assuming that irrationality will magically become rational behavior in aggregate.

Therefore, US conservatives post Eisenhower but especially post Reagan are almost certainly economic neoliberals. Since Clinton, liberals/Democrats have been too (at least the elected ones). You nailed neoconservative and both parties are in foreign policy since at least Clinton ... though here lets not forget to go back as far as JFK and his extreme anti-Communism that led to all sorts of covert operations, The Bay of Pigs, Vietnam, and the Cuban Missile Crisis. Remember, the Soviets put the missiles in Cuba because we put missiles in Turkey and they backed down from Cuba because we agreed to remove the missiles from Turkey; Nikita was nice enough not to talk about that so that Kennedy didn't lose face.

"Don't believe them, don't fear them, don't ask anything of them" - Aleksandr Solzhenitsyn

Hugh on Mon, 08/20/2012 - 3:57pm

I agree that neoconservatism and neoliberalism are two facets of corporatism/kleptocracy. I like the kinetic vs. white collar distinction.

The roots of neoliberalism go back to the 1940s and the Austrians, but in the US it really only comes into currency with Clinton as a deliberate shift of the Democratic/liberal platform away from labor and ordinary Americans to make it more accommodating to big business and big money. I had never heard of neoliberalism before Bill Clinton but it is easy to see how those tendencies were at work under Carter, but not under Johnson.

This was a rough and ready sketch. I guess I should also have mentioned PNAC or the Project to Find a New Mission for the MIC.

Hugh on Mon, 08/20/2012 - 10:44pm

I have never understood this love of Clinton that some Democrats have just as I have never understood the attraction of Reagan for Republicans. There is no Clinton faction. There is no Obama faction. Hillary Clinton is Obama's frigging Secretary of State. Robert Rubin and Larry Summers, both of whom served as Bill Clinton's Treasury Secretary, were Obama's top financial and economic advisors. Timothy Geithner was their protégé. Leon Panetta Obama's Director of the CIA and current Secretary of Defense was Clinton's Director of OMB and then Chief of Staff.

The Democrats as a party are neoconservative and neoliberal as are Obama and the Clintons. As are Republicans.

What does corporations need regulation mean? It is rather like saying that the best way to deal with cancer is to find a cure for it. Sounds nice but there is no content to it. Worse in the real world, the rich own the corporations, the politicians, and the regulators. So even if you come up with good ideas for regulation they aren't going to happen.

What you are suggesting looks a whole lot another iteration of lesser evilism meets Einstein's definition of insanity. How is it any different from any other instance of Democratic tribalism?

Lex on Mon, 08/20/2012 - 11:49pm

Perhaps it should be pointed out that the Clintons became fabulously wealthy just after Bill left office, mostly on the strength of his speaking engagements for the financial sector that he'd just deregulated. Both he and Hillary hew to a pretty damned neoconservative foreign policy ... with that dash of "humanitarian interventionism" that makes war palatable to liberals.

But your deeper point is that there isn't enough of a difference between Obama and Bill Clinton to really draw a distinction, not in terms of ideology. What a theoretical Hillary Clinton presidency would have looked like is irrelevant, because both Bill and Obama talked a lot different than they walked. Any projection of a Hillary Clinton administration is just that and requires arguing that it would have been different than Bill's administration and policies.

The unfortunate fact of the matter is that at that level of politics, the levers of money and power work equally well on both party's nomenklatura. They flock to it like moths to porch light.

That the money chose Obama over Clinton doesn't say all that much, because there's no evidence suggesting that the money didn't like Clinton or that it would have chosen McCain over Clinton. It's not as if Clinton's campaign was driven into the ground by lack of funds.

Regardless, that to be a Democrat i would kind of have to chose between two factions that are utterly distasteful to me just proves that i have no business being a Democrat. And since i wouldn't vote for either of those names, i guess i'll just stick to third parties and exit the political tribalism loop for good.

"Don't believe them, don't fear them, don't ask anything of them" - Aleksandr Solzhenitsyn

[Dec 04, 2017] The neoliberal framework in antitrust is based on pecifically its pegging competition to consumer welfare, defined as short-term price effects and as such s unequipped to capture the architecture of market power in the modern economy

Notable quotes:
"... This Note argues that the current framework in antitrust-specifically its pegging competition to "consumer welfare," defined as short-term price effects-is unequipped to capture the architecture of market power in the modern economy. We cannot cognize the potential harms to competition posed by Amazon's dominance if we measure competition primarily through price and output. ..."
"... This Note maps out facets of Amazon's dominance. Doing so enables us to make sense of its business strategy, illuminates anticompetitive aspects of Amazon's structure and conduct, and underscores deficiencies in current doctrine. The Note closes by considering two potential regimes for addressing Amazon's power: restoring traditional antitrust and competition policy principles or applying common carrier obligations and duties. ..."
Feb 12, 2017 | economistsview.typepad.com
anne : February 11, 2017 at 11:43 AM , 2017 at 11:43 AM
http://www.yalelawjournal.org/article/amazons-antitrust-paradox

January, 2017

Amazon's Antitrust Paradox
By Lina M. Khan

Abstract

Amazon is the titan of twenty-first century commerce. In addition to being a retailer, it is now a marketing platform, a delivery and logistics network, a payment service, a credit lender, an auction house, a major book publisher, a producer of television and films, a fashion designer, a hardware manufacturer, and a leading host of cloud server space. Although Amazon has clocked staggering growth, it generates meager profits, choosing to price below-cost and expand widely instead. Through this strategy, the company has positioned itself at the center of e-commerce and now serves as essential infrastructure for a host of other businesses that depend upon it. Elements of the firm's structure and conduct pose anticompetitive concerns -- yet it has escaped antitrust scrutiny.

This Note argues that the current framework in antitrust-specifically its pegging competition to "consumer welfare," defined as short-term price effects-is unequipped to capture the architecture of market power in the modern economy. We cannot cognize the potential harms to competition posed by Amazon's dominance if we measure competition primarily through price and output.

Specifically, current doctrine underappreciates the risk of predatory pricing and how integration across distinct business lines may prove anticompetitive. These concerns are heightened in the context of online platforms for two reasons. First, the economics of platform markets create incentives for a company to pursue growth over profits, a strategy that investors have rewarded. Under these conditions, predatory pricing becomes highly rational-even as existing doctrine treats it as irrational and therefore implausible. Second, because online platforms serve as critical intermediaries, integrating across business lines positions these platforms to control the essential infrastructure on which their rivals depend. This dual role also enables a platform to exploit information collected on companies using its services to undermine them as competitors.

This Note maps out facets of Amazon's dominance. Doing so enables us to make sense of its business strategy, illuminates anticompetitive aspects of Amazon's structure and conduct, and underscores deficiencies in current doctrine. The Note closes by considering two potential regimes for addressing Amazon's power: restoring traditional antitrust and competition policy principles or applying common carrier obligations and duties.

Financial parasitism and looting are the "new normal"

Sep 17, 2012 | wsws.org

Financial parasitism and looting are the "new normal."

The decision by the US Federal Reserve Board to provide indefinite support to financial markets under a third round of so-called quantitative easing (QE3), announced last week, coupled with the earlier decision by the European Central Bank (ECB) to intervene in the bond markets, marks a new stage in the breakdown of the global capitalist economy that began with the collapse of Lehman Brothers.

The moves by the world's major central banks to pump more money into the global financial system signify that four years after financial markets stood on the brink of collapse in September 2008, there is no prospect of a return to what were once considered "normal" conditions.

Far from lessening its support to the banks and financial institutions, the Fed is increasing it. The earlier interventions were implemented with time limits. In its latest decision, the Fed has given an indefinite commitment. As the headline of one article in the Financial Times put it, "Fed Sets Its Sights on Infinity and Beyond."

Moreover, the form of the commitment marks a major turn. Rather than buying up Treasury bonds, the Fed is going to intervene to the tune of $40 billion a month to buy up mortgage-backed securities from the banks and investment houses. It will thereby enable the banks to offload some of the "toxic assets" that provided the trigger for the breakdown.

It used to be said that the task of the Fed was to take away the punch bowl just as the party was about to get going. No longer. Now the Fed is committed to increasing the alcohol content, with a pledge that it will keep topping up the supply indefinitely.

In providing a rationale for the decision, Fed Chairman Ben Bernanke cited the continuing high levels of US unemployment-job growth, even at the lower wage levels now prevailing in the US, is failing to keep pace with population growth-and the anaemic growth in the US economy. According to conventional theory, the Fed's actions will lower interest rates across the board, making investment decisions more attractive to corporations and leading to economic growth and increased employment.

But as Bernanke well knows, as does everyone else in financial circles, those conditions do not apply. Corporations, above all financial institutions, are continuing to accumulate profits, but they are not being used to finance new productive investments. Rather, they are being funnelled into large cash reserves to be deployed in speculation.

Moreover, cuts in government spending both in Europe and the US are lowering wages and increasing unemployment, thereby reducing consumer demand. The ECB has made it a condition that governments whose bonds it buys must put in place austerity programs aimed at cutting spending and increasing unemployment. In the US, government spending is contracting and may decline even further at the end of the year with the arrival of the so-called "fiscal cliff," when earlier decisions by Congress to automatically initiate cuts come into effect.

The Fed's decision is not aimed at bringing about economic "recovery" in any meaningful sense of the term. Rather, its market intervention is intended to raise the price of stocks and asset-backed securities, lifting the profits of corporations, above all the banks and finance houses, not through investment in the real economy but via financial operations. In other words, the very financial parasitism that led to the collapse of Lehman Brothers and the near-meltdown of the US and global financial system has become the official policy of the Fed.

The class interests served by this policy can be seen both in the manner of its implementation and its consequences.

Financial journalist Michael West accurately summed the circumstances of its introduction in an article published in Saturday's Sydney Morning Herald.

"They demanded the Fed 'deliver'," he wrote. "The consequences of 'failure' were 'dire', they cried." Bernanke then "obliged the denizens of Wall Street" with the "ultimate money-printing bonanza. And they then had the cheek to dress it up as a boon for the jobless. In reality, the banks get to shovel their lame mortgage debts plumb into the lap of the taxpayers at $40 billion a month."

As he noted, the Fed is buying not just government bonds, but the "mortgage-backed securities which are clogging up Wall Street balance sheets."

The Fed's decision will have global consequences, all of which will impact adversely on the social and economic circumstances of workers as well as the world's poorest people. Immediately the decision was announced, the prices of oil and gold jumped, signalling the start of a new round of commodity speculation.

This will impact the prices of fuels for transport as well as for cooking and heating, and set off inflation in basic foodstuffs. Already the prices of corn, wheat and soybeans, crucial for the well-being of billions of people, have started to increase.

By printing money, the Fed is also undermining the value of the US dollar in global currency markets, which will have a significant impact in Europe as the euro rises. This will lead to further cuts in exports and increased unemployment as firms find it increasingly difficult to compete.

Countries such as Brazil and Australia, where increases in currency values have already heavily impacted on manufacturing, will also be adversely affected. Further downward pressure on the dollar increases the prospect of "currency wars," as national governments strive to maintain their export markets.

There is also a political aspect to the Fed's decision. In 2008, the collapse of Lehman Brothers played a crucial role in swinging the support of key sections of the American ruling elite behind the election of Barack Obama over his Republican opponent John McCain.

The Fed's latest action in the run-up to this year's election will similarly provide a boost to the Obama re-election campaign.

But the most significant political conclusions are those that must be drawn by the working class. The decision to promote financial parasitism at the expense of the jobs, livelihoods and social position of the working class in the US and the world over is another powerful expression of the historic crisis and bankruptcy of the capitalist system. There is no economic "recovery" waiting around the corner.

The banks and financial interests represented by the US Federal Reserve and the ECB have a program: parasitism accompanied by the systematic looting and impoverishment of the population.

The working class in the US and internationally must adopt its own independent program, thought out and fought for to the end. It must initiate a struggle for workers' governments committed to the expropriation of the banks and finance houses as the first, and indispensable, step in the establishment of a planned socialist economy, in which the resources created by the labour of billions are used to meet human needs instead of profit.

Nick Beams

[Oct 24, 2017] The Blind Justice Lady is real

Oct 24, 2017 | www.zerohedge.com

AlaricBalth -> Creepy_Azz_Crackaah , Oct 24, 2017 1:03 PM

"Our justice system is represented by a blind-folded woman holding a set of scales. Those scales do not tip to the right or the left; they do not recognize wealth, power, or social status. The impartiality of our justice system is the bedrock of our republic..."

Spewed coffee after reading this quote.

E.F. Mutton -> Gerry Fletcher , Oct 24, 2017 12:57 PM

The Blind Justice Lady is real, she just has a .45 at the back of her head held by Hillary

And don't even ask where Bill's finger is

[Oct 23, 2017] Neoliberalism as Creative Destruction David Harvey, 2007

This article is 10 year old but the analysis presented still remain by-and-large current.
You can read full article in Neoliberalism As Creative Destruction - David Harvey by Open Critique - issue
Notable quotes:
"... Neoliberalism is a theory of political economic practices proposing that human well-being can best be advanced by the maximization of entrepreneurial freedoms within an institutional framework characterized by private property rights, individual liberty, unencumbered markets, and free trade. ..."
"... Furthermore, if markets do not exist (in areas such as education, health care, social security, or environmental pollution), then they must be created, by state action if necessary. ..."
"... State interventions in markets (once created) must be kept to a bare minimum because the state cannot possibly possess enough information to second-guess market signals (prices) and because powerful interests will inevitably distort and bias state interventions (particularly in democracies) for their own benefit. ..."
"... State after state, from the new ones that emerged from the collapse of the Soviet Union to old-style social democracies and welfare states such as New Zealand and Sweden, have embraced, sometimes voluntarily and sometimes in response to coercive pressures, some version of neoliberal theory and adjusted at least some of their policies and practices accordingly. Post apartheid South Africa quickly adopted the neoliberal frame and even contemporary China appears to be headed in that direction. Furthermore, advocates of the neoliberal mindset now occupy positions of considerable influence in education (universities and many "think tanks"), in the media, in corporate board rooms and financial institutions, in key state institutions (treasury departments, central banks), and also in those international institutions such as the International Monetary Fund (IMF) and the World Trade Organization (WTO) that regulate global finance and commerce. Neoliberalism has, in short, become hegemonic as a mode of discourse and has pervasive effects on ways of thought and political-economic practices to the point where it has become incorporated into the commonsense way we interpret, live in, and understand the world. ..."
"... Neoliberalization has in effect swept across the world like a vast tidal wave of institutional reform and discursive adjustment. While plenty of evidence shows its uneven geographical development, no place can claim total immunity (with the exception of a few states such as North Korea). Furthermore, the rules of engagement now established through the WTO (governing international trade) and by the IMF (governing international finance) instantiate neoliberalism as a global set of rules. All states that sign on to the WTO and the IMF (and who can afford not to?) agree to abide (albeit with a "grace period" to permit smooth adjustment) by these rules or face severe penalties. ..."
"... For any system of thought to become dominant, it requires the articulation of fundamental concepts that become so deeply embedded in commonsense understandings that they are taken for granted and beyond question. For this to occur, not any old concepts will do. A conceptual apparatus has to be constructed that appeals almost naturally to our intuitions and instincts, to our values and our desires, as well as to the possibilities that seem to inhere in the social world we inhabit. The founding figures of neoliberal thought took political ideals of individual liberty and freedom as sacrosanct -- as the central values of civilization. And in so doing they chose wisely and well, for these are indeed compelling and greatly appealing concepts. Such values were threatened, they argued, not only by fascism, dictatorships, and communism, but also by all forms of state intervention that substituted collective judgments for those of individuals set free to choose. They then concluded that without "the diffused power and initiative associated with (private property and the competitive market) it is difficult to imagine a society in which freedom may be effectively preserved." 1 ..."
"... The U.S. answer was spelled out on September 19, 2003, when Paul Bremer, head of the Coalition Provisional Authority, promulgated four orders that included "the full privatization of public enterprises, full ownership rights by foreign firms of Iraqi U.S. businesses, full repatriation of foreign profits . . . the opening of Iraq's banks to foreign control, national treatment for foreign companies and . . . the elimination of nearly all trade barriers." 4 The orders were to apply to all areas of the economy, including public services, the media, manufacturing, services, transportation, finance, and construction. Only oil was exempt. A regressive tax system favored by conservatives called a flat tax was also instituted. The right to strike was outlawed and unions banned in key sectors. An Iraqi member of the Coalition Provisional Authority protested the forced imposition of "free market fundamentalism," describing it as "a flawed logic that ignores history." 5 Yet the interim Iraqi government appointed at the end of June 2004 was accorded no power to change or write new laws -- it could only confirm the decrees already promulgated. ..."
"... The redistributive tactics of neoliberalism are wide-ranging, sophisticated, frequently masked by ideological gambits, but devastating for the dignity and social well-being of vulnerable populations and territories. The wave of creative destruction neoliberalization has visited across the globe is unparalleled in the history of capitalism. Understandably, it has spawned resistance and a search for viable alternatives. ..."
Oct 23, 2017 | journals.sagepub.com

Neoliberalism has become a hegemonic discourse with pervasive effects on ways of thought and political-economic practices to the point where it is now part of the commonsense way we interpret, live in, and understand the world. How did neoliberalism achieve such an exalted status, and what does it stand for? In this article, the author contends that neoliberalism is above all a project to restore class dominance to sectors that saw their fortunes threatened by the ascent of social democratic endeavors in the aftermath of the Second World War. Although neoliberalism has had limited effectiveness as an engine for economic growth, it has succeeded in channeling wealth from subordinate classes to dominant ones and from poorer to richer countries. This process has entailed the dismantling of institutions and narratives that promoted more egalitarian distributive measures in the preceding era.

Neoliberalism is a theory of political economic practices proposing that human well-being can best be advanced by the maximization of entrepreneurial freedoms within an institutional framework characterized by private property rights, individual liberty, unencumbered markets, and free trade. The role of the state is to create and preserve an institutional framework appropriate to such practices. The state has to be concerned, for example, with the quality and integrity of money. It must also set up military, defense, police, and juridical functions required to secure private property rights and to support freely functioning markets. Furthermore, if markets do not exist (in areas such as education, health care, social security, or environmental pollution), then they must be created, by state action if necessary. But beyond these tasks the state should not venture. State interventions in markets (once created) must be kept to a bare minimum because the state cannot possibly possess enough information to second-guess market signals (prices) and because powerful interests will inevitably distort and bias state interventions (particularly in democracies) for their own benefit.

For a variety of reasons, the actual practices of neoliberalism frequently diverge from this template. Nevertheless, there has everywhere been an emphatic turn, ostensibly led by the Thatcher/Reagan revolutions in Britain and the United States, in political-economic practices and thinking since the 1970s. State after state, from the new ones that emerged from the collapse of the Soviet Union to old-style social democracies and welfare states such as New Zealand and Sweden, have embraced, sometimes voluntarily and sometimes in response to coercive pressures, some version of neoliberal theory and adjusted at least some of their policies and practices accordingly. Post apartheid South Africa quickly adopted the neoliberal frame and even contemporary China appears to be headed in that direction. Furthermore, advocates of the neoliberal mindset now occupy positions of considerable influence in education (universities and many "think tanks"), in the media, in corporate board rooms and financial institutions, in key state institutions (treasury departments, central banks), and also in those international institutions such as the International Monetary Fund (IMF) and the World Trade Organization (WTO) that regulate global finance and commerce. Neoliberalism has, in short, become hegemonic as a mode of discourse and has pervasive effects on ways of thought and political-economic practices to the point where it has become incorporated into the commonsense way we interpret, live in, and understand the world.

Neoliberalization has in effect swept across the world like a vast tidal wave of institutional reform and discursive adjustment. While plenty of evidence shows its uneven geographical development, no place can claim total immunity (with the exception of a few states such as North Korea). Furthermore, the rules of engagement now established through the WTO (governing international trade) and by the IMF (governing international finance) instantiate neoliberalism as a global set of rules. All states that sign on to the WTO and the IMF (and who can afford not to?) agree to abide (albeit with a "grace period" to permit smooth adjustment) by these rules or face severe penalties.

The creation of this neoliberal system has entailed much destruction, not only of prior institutional frameworks and powers (such as the supposed prior state sovereignty over political-economic affairs) but also of divisions of labor, social relations, welfare provisions, technological mixes, ways of life, attachments to the land, habits of the heart, ways of thought, and the like. Some assessment of the positives and negatives of this neoliberal revolution is called for. In what follows, therefore, I will sketch in some preliminary arguments as to how to both understand and evaluate this transformation in the way global capitalism is working. This requires that we come to terms with the underlying forces, interests, and agents that have propelled the neoliberal revolution forward with such relentless intensity. To turn the neoliberal rhetoric against itself, we may reasonably ask, In whose particular interests is it that the state take a neoliberal stance and in what ways have those interests used neoliberalism to benefit themselves rather than, as is claimed, everyone, everywhere?

In whose particular interests is it that the state take a neoliberal stance, and in what ways have those interests used neoliberalism to benefit themselves rather than, as is claimed, everyone, everywhere?

The "Naturalization" of Neoliberalism

For any system of thought to become dominant, it requires the articulation of fundamental concepts that become so deeply embedded in commonsense understandings that they are taken for granted and beyond question. For this to occur, not any old concepts will do. A conceptual apparatus has to be constructed that appeals almost naturally to our intuitions and instincts, to our values and our desires, as well as to the possibilities that seem to inhere in the social world we inhabit. The founding figures of neoliberal thought took political ideals of individual liberty and freedom as sacrosanct -- as the central values of civilization. And in so doing they chose wisely and well, for these are indeed compelling and greatly appealing concepts. Such values were threatened, they argued, not only by fascism, dictatorships, and communism, but also by all forms of state intervention that substituted collective judgments for those of individuals set free to choose. They then concluded that without "the diffused power and initiative associated with (private property and the competitive market) it is difficult to imagine a society in which freedom may be effectively preserved." 1

Setting aside the question of whether the final part of the argument necessarily follows from the first, there can be no doubt that the concepts of individual liberty and freedom are powerful in their own right, even beyond those terrains where the liberal tradition has had a strong historical presence. Such ideals empowered the dissident movements in Eastern Europe and the Soviet Union before the end of the cold war as well as the students in Tiananmen Square. The student movement that swept the world in 1968 -- from Paris and Chicago to Bangkok and Mexico City -- was in part animated by the quest for greater freedoms of speech and individual choice. These ideals have proven again and again to be a mighty historical force for change.

It is not surprising, therefore, that appeals to freedom and liberty surround the United States rhetorically at every turn and populate all manner of contemporary political manifestos. This has been particularly true of the United States in recent years. On the first anniversary of the attacks now known as 9/11, President Bush wrote an op-ed piece for the New York Times that extracted ideas from a U.S. National Defense Strategy document issued shortly thereafter. "A peaceful world of growing freedom," he wrote, even as his cabinet geared up to go to war with Iraq, "serves American long-term interests, reflects enduring American ideals and unites Americas allies." "Humanity," he concluded, "holds in its hands the opportunity to offer freedom s triumph over all its age-old foes," and "the United States welcomes its responsibilities to lead in this great mission." Even more emphatically, he later proclaimed that "freedom is the Almighty's gift to every man and woman in this world" and "as the greatest power on earth [the United States has] an obligation to help the spread of freedom." 2

So when all of the other reasons for engaging in a preemptive war against Iraq were proven fallacious or at least wanting, the Bush administration increasingly appealed to the idea that the freedom conferred upon Iraq was in and of itself an adequate justification for the war. But what sort of freedom was envisaged here, since, as the cultural critic Matthew Arnold long ago thoughtfully observed, "Freedom is a very good horse to ride, but to ride somewhere." 3 To what destination, then, were the Iraqi people expected to ride the horse of freedom so selflessly conferred to them by force of arms?

The U.S. answer was spelled out on September 19, 2003, when Paul Bremer, head of the Coalition Provisional Authority, promulgated four orders that included "the full privatization of public enterprises, full ownership rights by foreign firms of Iraqi U.S. businesses, full repatriation of foreign profits . . . the opening of Iraq's banks to foreign control, national treatment for foreign companies and . . . the elimination of nearly all trade barriers." 4 The orders were to apply to all areas of the economy, including public services, the media, manufacturing, services, transportation, finance, and construction. Only oil was exempt. A regressive tax system favored by conservatives called a flat tax was also instituted. The right to strike was outlawed and unions banned in key sectors. An Iraqi member of the Coalition Provisional Authority protested the forced imposition of "free market fundamentalism," describing it as "a flawed logic that ignores history." 5 Yet the interim Iraqi government appointed at the end of June 2004 was accorded no power to change or write new laws -- it could only confirm the decrees already promulgated.

What the United States evidently sought to impose upon Iraq was a full-fledged neoliberal state apparatus whose fundamental mission was and is to facilitate conditions for profitable capital accumulation for all comers, Iraqis and foreigners alike. The Iraqis were, in short, expected to ride their horse of freedom straight into the corral of neoliberalism. According to neoliberal theory, Bremers decrees are both necessary and sufficient for the creation of wealth and therefore for the improved well-being of the Iraqi people. They are the proper foundation for an adequate rule of law, individual liberty, and democratic governance. The insurrection that followed can in part be interpreted as Iraqi resistance to being driven into the embrace of free market fundamentalism against their own will

It is useful to recall, however, that the first great experiment with neoliberal state formation was Chile after Augusto Pinochet s coup almost thirty years to the day before Bremers decrees were issued, on the "little September 11th" of 1973. The coup, against the democratically elected and leftist social democratic government of Salvador Allende, was strongly backed by the CIA and supported by U.S. Secretary of State Henry Kissinger. It violently repressed all left-of-center social movements and political organizations and dismantled all forms of popular organization, such as community health centers in poorer neighborhoods. The labor market was "freed" from regulatory or institutional restraints -- trade union power, for example. But by 1973, the policies of import substitution that had formerly dominated in Latin American attempts at economic regeneration, and that had succeeded to some degree in Brazil after the military coup of 1964, had fallen into disrepute. With the world economy in the midst of a serious recession, something new was plainly called for. A group of U.S. economists known as "the Chicago boys," because of their attachment to the neoliberal theories of Milton Friedman, then teaching at the University of Chicago, were summoned to help reconstruct the Chilean economy. They did so along free-market lines, privatizing public assets, opening up natural resources to private exploitation, and facilitating foreign direct investment and free trade. The right of foreign companies to repatriate profits from their Chilean operations was guaranteed. Export-led growth was favored over import substitution. The subsequent revival of the Chilean economy in terms of growth, capital accumulation, and high rates of return on foreign investments provided evidence upon which the subsequent turn to more open neoliberal policies in both Britain (under Thatcher) and the United States (under Reagan) could be modeled. Not for the first time, a brutal experiment in creative destruction carried out in the periphery became a model for the formulation of policies in the center. 6

The fact that two such obviously similar restructurings of the state apparatus occurred at such different times in quite different parts of the world under the coercive influence of the United States might be taken as indicative that the grim reach of U.S. imperial power might lie behind the rapid proliferation of neoliberal state forms throughout the world from the mid-1970s onward. But U.S. power and recklessness do not constitute the whole story. It was not the United States, after all, that forced Margaret Thatcher to take the neoliberal path in 1979. And during the early 1980s, Thatcher was a far more consistent advocate of neoliberalism than Reagan ever proved to be. Nor was it the United States that forced China in 1978 to follow the path that has over time brought it closer and closer to the embrace of neoliberalism. It would be hard to attribute the moves toward neoliberalism in India and Sweden in 1992 to the imperial reach of the United States. The uneven geographical development of neoliberalism on the world stage has been a very complex process entailing multiple determinations and not a little chaos and confusion. So why, then, did the neoliberal turn occur, and what were the forces compelling it onward to the point where it has now become a hegemonic system within global capitalism?

Why the Neoliberal Turn?

Toward the end of the 1960s, global capitalism was falling into disarray. A significant recession occurred in early 1973 -- the first since the great slump of the 1930s. The oil embargo and oil price hike that followed later that year in the wake of the Arab-Israeli war exacerbated critical problems. The embedded capitalism of the postwar period, with its heavy emphasis on an uneasy compact between capital and labor brokered by an interventionist state that paid great attention to the social (i.e., welfare programs) and individual wage, was no longer working. The Bretton Woods accord set up to regulate international trade and finance was finally abandoned in favor of floating exchange rates in 1973. That system had delivered high rates of growth in the advanced capitalist countries and generated some spillover benefits -- most obviously to Japan but also unevenly across South America and to some other countries of South East Asia -- during the "golden age" of capitalism in the 1950s and early 1960s. By the next decade, however, the preexisting arrangements were exhausted and a new alternative was urgently needed to restart the process of capital accumulation. 7 How and why neoliberalism emerged victorious as an answer to that quandary is a complex story. In retrospect, it may seem as if neoliberalism had been inevitable, but at the time no one really knew or understood with any certainty what kind of response would work and how.

The world stumbled toward neoliberalism through a series of gyrations and chaotic motions that eventually converged on the so-called 'Washington Consensus" in the 1990s. The uneven geographical development of neoliberalism, and its partial and lopsided application from one country to another, testifies to its tentative character and the complex ways in which political forces, historical traditions, and existing institutional arrangements all shaped why and how the process actually occurred on the ground.

There is, however, one element within this transition that deserves concerted attention. The crisis of capital accumulation of the 1970s affected everyone through the combination of rising unemployment and accelerating inflation. Discontent was widespread, and the conjoining of labor and urban social movements throughout much of the advanced capitalist world augured a socialist alternative to the social compromise between capital and labor that had grounded capital accumulation so successfully in the postwar period. Communist and socialist parties were gaining ground across much of Europe, and even in the United States popular forces were agitating for widespread reforms and state interventions in everything ranging from environmental protection to occupational safety and health and consumer protection from corporate malfeasance. There was. in this, a clear political threat to ruling classes everywhere, both in advanced capitalist countries, like Italy and France, and in many developing countries, like Mexico and Argentina.

Beyond political changes, the economic threat to the position of ruling classes was now becoming palpable. One condition of the postwar settlement in almost all countries was to restrain the economic power of the upper classes and for labor to be accorded a much larger share of the economic pie. In the United States, for example, the share of the national income taken by the top 1 percent of earners fell from a prewar high of 16 percent to less than 8 percent by the end of the Second World War and stayed close to that level for nearly three decades. While growth was strong such restraints seemed not to matter, but when growth collapsed in the 1970s, even as real interest rates went negative and dividends and profits shrunk, ruling classes felt threatened. They had to move decisively if they were to protect their power from political and economic annihilation.

The coup d'état in Chile and the military takeover in Argentina, both fomented and led internally by ruling elites with U.S. support, provided one kind of solution. But the Chilean experiment with neoliberalism demonstrated that the benefits of revived capital accumulation were highly skewed. The country and its ruling elites along with foreign investors did well enough while the people in general fared poorly. This has been such a persistent effect of neoliberal policies over time as to be regarded a structural component of the whole project. Dumenil and Levy have gone so far as to argue that neoliberalism was from the very beginning an endeavor to restore class power to the richest strata in the population. They showed how from the mid-1980s onwards, the share of the top 1 percent of income earners in the United States soared rapidly to reach 15 percent by the end of the century. Other data show that the top 0.1 percent of income earners increased their share of the national income from 2 percent in 1978 to more than 6 percent by 1999. Yet another measure shows that the ratio of the median compensation of workers to the salaries of chief executive officers increased from just over thirty to one in 1970 to more than four hundred to one by 2000. Almost certainly, with the Bush administrations tax cuts now taking effect, the concentration of income and of wealth in the upper echelons of society is continuing apace. 8

And the United States is not alone in this: the top 1 percent of income earners in Britain doubled their share of the national income from 6.5 percent to 13 percent over the past twenty years. When we look further afield, we see extraordinary concentrations of wealth and power within a small oligarchy after the application of neoliberal shock therapy in Russia and a staggering surge in income inequalities and wealth in China as it adopts neoliberal practices. While there are exceptions to this trend -- several East and Southeast Asian countries have contained income inequalities within modest bounds, as have France and the Scandinavian countries -- the evidence suggests that the neoliberal turn is in some way and to some degree associated with attempts to restore or reconstruct upper-class power.

We can, therefore, examine the history of neoliberalism either as a utopian project providing a theoretical template for the reorganization of international capitalism or as a political scheme aimed at reestablishing the conditions for capital accumulation and the restoration of class power. In what follows, I shall argue that the last of these objectives has dominated. Neoliberalism has not proven effective at revitalizing global capital accumulation, but it has succeeded in restoring class power. As a consequence, the theoretical utopianism of the neoliberal argument has worked more as a system of justification and legitimization. The principles of neoliberalism are quickly abandoned whenever they conflict with this class project.

Neoliberalism has not proven effective at revitalizing global capital accumulation, but it has succeeded in restoring class power.

Toward the Restoration of Class Power

If there were movements to restore class power within global capitalism, then how were they enacted and by whom? The answer to that question in countries such as Chile and Argentina was simple: a swift, brutal, and self-assured military coup backed by the upper classes and the subsequent fierce repression of all solidarities created within the labor and urban social movements that had so threatened their power. Elsewhere, as in Britain and Mexico in 1976, it took the gentle prodding of a not yet fiercely neoliberal International Monetary Fund to push countries toward practices -- although by no means policy commitment -- to cut back on social expenditures and welfare programs to reestablish fiscal probity. In Britain, of course, Margaret Thatcher later took up the neoliberal cudgel with a vengeance in 1979 and wielded it to great effect, even though she never fully overcame opposition within her own party and could never effectively challenge such centerpieces of the welfare state as the National Health Service. Interestingly, it was only in 2004 that the Labour Government dared to introduce a fee structure into higher education. The process of neoliberalization has been halting, geographically uneven, and heavily influenced by class structures and other social forces moving for or against its central propositions within particular state formations and even within particular sectors, for example, health or education. 9

It is informative to look more closely at how the process unfolded in the United States, since this case was pivotal as an influence on other and more recent transformations. Various threads of power intertwined to create a transition that culminated in the mid-1990s with the takeover of Congress by the Republican Party. That feat represented in fact a neoliberal "Contract with America" as a program for domestic action. Before that dramatic denouement, however, many steps were taken, each building upon and reinforcing the other.

To begin with, by 1970 or so, there was a growing sense among the U.S. upper classes that the anti-business and anti-imperialist climate that had emerged toward the end of the 1960s had gone too far. In a celebrated memo, Lewis Powell (about to be elevated to the Supreme Court by Richard Nixon) urged the American Chamber of Commerce in 1971 to mount a collective campaign to demonstrate that what was good for business was good for America. Shortly thereafter, a shadowy but influential Business Round Table was formed that still exists and plays a significant strategic role in Republican Party politics. Corporate political action committees, legalized under the post-Watergate campaign finance laws of 1974, proliferated like wildfire. With their activities protected under the First Amendment as a form of free speech in a 1976 Supreme Court decision, the systematic capture of the Republican Party as a class instrument of collective (rather than particular or individual) corporate and financial power began. But the Republican Party needed a popular base, and that proved more problematic to achieve. The incorporation of leaders of the Christian right, depicted as a moral majority, together with the Business Round Table provided the solution to that problem. A large segment of a disaffected, insecure, and largely white working class was persuaded to vote consistently against its own material interests on cultural (anti-liberal, anti-Black, antifeminist and antigay), nationalist and religious grounds. By the mid-1990s, the Republican Party had lost almost all of its liberal elements and become a homogeneous right-wing machine connecting the financial resources of large corporate capital with a populist base, the Moral Majority, that was particularly strong in the U.S. South. 10

The second element in the U.S. transition concerned fiscal discipline. The recession of 1973 to 1975 diminished tax revenues at all levels at a time of rising demand for social expenditures. Deficits emerged everywhere as a key problem. Something had to be done about the fiscal crisis of the state; the restoration of monetary discipline was essential. That conviction empowered financial institutions that controlled the lines of credit to government. In 1975, they refused to roll over New York's debt and forced that city to the edge of bankruptcy. A powerful cabal of bankers joined together with the state to tighten control over the city. This meant curbing the aspirations of municipal unions, layoffs in public employment, wage freezes, cutbacks in social provision (education, public health, and transport services), and the imposition of user fees (tuition was introduced in the CUNY university system for the first time). The bailout entailed the construction of new institutions that had first rights to city tax revenues in order to pay off bond holders: whatever was left went into the city budget for essential services. The final indignity was a requirement that municipal unions invest their pension funds in city bonds. This ensured that unions moderate their demands to avoid the danger of losing their pension funds through city bankruptcy.

Such actions amounted to a coup d'état by financial institutions against the democratically elected government of New York City, and they were every bit as effective as the military overtaking that had earlier occurred in Chile. Much of the city's social infrastructure was destroyed, and the physical foundations (e.g., the transit system) deteriorated markedly for lack of investment or even maintenance. The management of New York's fiscal crisis paved the way for neoliberal practices both domestically under Ronald Reagan and internationally through the International Monetary Fund throughout the 1980s. It established a principle that, in the event of a conflict between the integrity of financial institutions and bondholders on one hand and the well-being of the citizens on the other, the former would be given preference. It hammered home the view that the role of government was to create a good business climate rather than look to the needs and well-being of the population at large. Fiscal redistributions to benefit the upper classes resulted in the midst of a general fiscal crisis.

Whether all the agents involved in producing this compromise in New York understood it at the time as a tactic for the restoration of upper-class power is an open question. The need to maintain fiscal discipline is a matter of deep concern in its own right and does not have to lead to the restitution of class dominance. It is unlikely, therefore, that Felix Rohatyn, the key merchant banker who brokered the deal between the city, the state, and the financial institutions, had the reinstatement of class power in mind. But this objective probably was very much in the thoughts of the investment bankers. It was almost certainly the aim of then-Secretary of the Treasury William Simon who, having watched the progress of events in Chile with approval, refused to give aid to New York and openly stated that he wanted that city to suffer so badly that no other city in the nation would ever dare take on similar social obligations again. 11

The third element in the U.S. transition entailed an ideological assault upon the media and upon educational institutions. Independent "think tanks" financed by wealthy individuals and corporate donors proliferated -- the Heritage Foundation in the lead -- to prepare an ideological onslaught aimed at persuading the public of the commonsense character of neoliberal propositions. A flood of policy papers and proposals and a veritable army of well-paid hired lieutenants trained to promote neoliberal ideas coupled with the corporate acquisition of media channels effectively transformed the discursive climate in the United States by the mid-1980s. The project to "get government off the backs of the people" and to shrink government to the point where it could be "drowned in a bathtub" was loudly proclaimed. With respect to this, the promoters of the new gospel found a ready audience in that wing of the 1968 movement whose goal was greater individual liberty and freedom from state power and the manipulations of monopoly capital. The libertarian argument for neoliberalism proved a powerful force for change. To the degree that capitalism reorganized to both open a space for individual entrepreneurship and switch its efforts to satisfy innumerable niche markets, particularly those defined by sexual liberation, that were spawned out of an increasingly individualized consumerism, so it could match words with deeds.

This carrot of individualized entrepreneurship and consumerism was backed by the big stick wielded by the state and financial institutions against that other wing of the 1968 movement whose members had sought social justice through collective negotiation and social solidarities. Reagan's destruction of the air traffic controllers (PATCO) in 1980 and Margaret Thatchers defeat of the British miners in 1984 were crucial moments in the global turn toward neoliberalism. The assault upon institutions, such as trade unions and welfare rights organizations, that sought to protect and further working-class interests was as broad as it was deep. The savage cutbacks in social expenditures and the welfare state, and the passing of all responsibility for their well-being to individuals and their families proceeded apace. But these practices did not and could not stop at national borders. After 1980, the United States, now firmly committed to neoliberalization and clearly backed by Britain, sought, through a mix of leadership, persuasion -- the economics departments of U.S. research universities played a major role in training many of the economists from around the world in neoliberal principles -- and coercion to export neoliberalization far and wide. The purge of Keynesian economists and their replacement by neoliberal monetarists in the International Monetary Fund in 1982 transformed the U.S.-dominated IMF into a prime agent of neoliberalization through its structural adjustment programs visited upon any state (and there were many in the 1980s and 1990s) that required its help with debt repayments. The Washington Consensus that was forged in the 1990s and the negotiating rules set up under the World Trade Organization in 1998 confirmed the global turn toward neoliberal practices. 12

The new international compact also depended upon the reanimation and reconfiguration of the U.S. imperial tradition. That tradition had been forged in Central America in the 1920s, as a form of domination without colonies. Independent republics could be kept under the thumb of the United States and effectively act, in the best of cases, as proxies for U.S. interests through the support of strongmen -- like Somoza in Nicaragua, the Shah in Iran, and Pinochet in Chile -- and a coterie of followers backed by military assistance and financial aid. Covert aid was available to promote the rise to power of such leaders, but by the 1970s it became clear that something else was needed: the opening of markets, of new spaces for investment, and clear fields where financial powers could operate securely. This entailed a much closer integration of the global economy with a well-defined financial architecture. The creation of new institutional practices, such as those set out by the IMF and the WTO, provided convenient vehicles through which financial and market power could be exercised. The model required collaboration among the top capitalist powers and the Group of Seven (G7), bringing Europe and Japan into alignment with the United States to shape the global financial and trading system in ways that effectively forced all other nations to submit. "Rogue nations," defined as those that failed to conform to these global rules, could then be dealt with by sanctions or coercive and even military force if necessary. In this way, U.S. neoliberal imperialist strategies were articulated through a global network of power relations, one effect of which was to permit the U.S. upper classes to exact financial tribute and command rents from the rest of the world as a means to augment their already hegemonic control. 13

Neoliberalism as Creative Destruction

In what ways has neoliberalization resolved the problems of flagging capital accumulation? Its actual record in stimulating economic growth is dismal. Aggregate growth rates stood at 3.5 percent or so in the 1960s and even during the troubled 1970s fell to only 2.4 percent. The subsequent global growth rates of 1.4 percent and 1.1 percent for the 1980s and 1990s, and a rate that barely touches 1 percent since 2000, indicate that neoliberalism has broadly failed to

In what ways has neoliberalization resolved the problems of flagging capital accumulation? Its actual record in stimulating economic growth is dismal. Aggregate growth rates stood at 3.5 percent or so in the 1960s and even during the troubled 1970s fell to only 2.4 percent. The subsequent global growth rates of 1.4 percent and 1.1 percent for the 1980s and 1990s, and a rate that barely touches 1 percent since 2000, indicate that neoliberalism has broadly failed to stimulate worldwide growth. 14 Even if we exclude from this calculation the catastrophic effects of the collapse of the Russian and some Central European economies in the wake of the neoliberal shock therapy treatment of the 1990s, global economic performance from the standpoint of restoring the conditions of general capital accumulation has been weak.

Despite their rhetoric about curing sick economies, neither Britain nor the United States achieved high economic performance in the 1980s. That decade belonged to Japan, the East Asian "Tigers," and West Germany as powerhouses of the global economy. Such countries were very successful, but their radically different institutional arrangements make it difficult to pin their achievements on neoliberalism. The West German Bundesbank had taken a strong monetarist line (consistent with neoliberalism) for more than two decades, a fact suggesting that there is no necessary connection between monetarism per se and the quest to restore class power. In West Germany, the unions remained strong and wage levels stayed relatively high alongside the construction of a progressive welfare state. One of the effects of this combination was to stimulate a high rate of technological innovation that kept West Germany well ahead in the field of international competition. Export-led production moved the country forward as a global leader.

In Japan, independent unions were weak or nonexistent, but state investment in technological and organizational change and the tight relationship between corporations and financial institutions (an arrangement that also proved felicitous in West Germany) generated an astonishing export-led growth performance, very much at the expense of other capitalist economies such as the United Kingdom and the United States. Such growth as there was in the 1980s (and the aggregate rate of growth in the world was lower even than that of the troubled 1970s) did not depend, therefore, on neoliberalization. Many European states therefore resisted neoliberal reforms and increasingly found ways to preserve much of their social democratic heritage while moving, in some cases fairly successfully, toward the West German model. In Asia, the Japanese model implanted under authoritarian systems of governance in South Korea, Taiwan, and Singapore also proved viable and consistent with reasonable equality of distribution. It was only in the 1990s that neoliberalization began to pay off for both the United States and Britain. This happened in the midst of a long-drawn-out period of deflation in Japan and relative stagnation in a newly unified Germany. Up for debate is whether the Japanese recession occurred as a simple result of competitive pressures or whether it was engineered by financial agents in the United States to humble the Japanese economy.

So why, then, in the face of this patchy if not dismal record, have so many been persuaded that neoliberalization is a successful solution? Over and beyond the persistent stream of propaganda emanating from the neoliberal think tanks and suffusing the media, two material reasons stand out. First, neoliberalization has been accompanied by increasing volatility within global capitalism. That success was to materialize somewhere obscured the reality that neoliberalism was generally failing. Periodic episodes of growth interspersed with phases of creative destruction, usually registered as severe financial crises. Argentina was opened up to foreign capital and privatization in the 1990s and for several years was the darling of Wall Street, only to collapse into disaster as international capital withdrew at the end of the decade. Financial collapse and social devastation was quickly followed by a long political crisis. Financial turmoil proliferated all over the developing world, and in some instances, such as Brazil and Mexico, repeated waves of structural adjustment and austerity led to economic paralysis.

On the other hand, neoliberalism has been a huge success from the standpoint of the upper classes. It has either restored class position to ruling elites, as in the United States and Britain, or created conditions for capitalist class formation, as in China, India, Russia, and elsewhere. Even countries that have suffered extensively from neoliberalization have seen the massive reordering of class structures internally. The wave of privatization that came to Mexico with the Salinas de Gortari administration in 1992 spawned unprecedented concentrations of wealth in the hands of a few people (Carlos Slim, tor example, who took over the state telephone system and became an instant billionaire).

With the media dominated by upper-class interests, the myth could be propagated that certain sectors failed because they were not competitive enough, thereby setting the stage for even more neoliberal reforms. Increased social inequality was necessary to encourage entrepreneurial risk and innovation, and these, in turn, conferred competitive advantage and stimulated growth. If conditions among the lower classes deteriorated, it was because they failed for personal and cultural reasons to enhance their own human capital through education, the acquisition of a protestant work ethic, and submission to work discipline and flexibility. In short, problems arose because of the lack of competitive strength or because of personal, cultural, and political failings. In a Spencerian world, the argument went, only the fittest should and do survive. Systemic problems were masked under a blizzard of ideological pronouncements and a plethora of localized crises.

If the main effect of neoliberalism has been redistributive rather than generative, then ways had to be found to transfer assets and channel wealth and income either from the mass of the population toward the upper classes or from vulnerable to richer countries. I have elsewhere provided an account of these processes under the rubric of accumulation by dispossession. 15 By this, I mean the continuation and proliferation of accretion practices that Marx had designated as "primitive" or "original" during the rise of capitalism. These include

(1) the commodification and privatization of land and me forceful expulsion or peasant populations {as in Mexico and India in recent times);

(2) conversion of various forms of property rights (common, collective, state, etc.) into exclusively private property rights;

(3) suppression of rights to the commons;

(4) commodification of labor power and the suppression of alternative (indigenous) forms of production and consumption;

(5) colonial, neocolonial, and imperial processes of appropriation of assets (including natural resources); (6) monetization of exchange and taxation, particularly of land;

(7) the slave trade (which continues, particularly in the sex industry); and

(8) usury, the national debt, and, most devastating of all, the use of the credit system as radical means of primitive accumulation.

The state, with its monopoly of violence and definitions of legality, plays a crucial role in backing and promoting these processes. To this list of mechanisms, we may now add a raft of additional techniques, such as the extraction of rents from patents and intellectual property rights and the diminution or erasure of various forms of communal property rights -- such as state pensions, paid vacations, access to education, and health care -- won through a generation or more of social democratic struggles. The proposal to privatize all state pension rights (pioneered in Chile under Augusto Pinochet s dictatorship) is, for example, one of the cherished objectives of neoliberals in the United States.

In the cases of China and Russia, it might be reasonable to refer to recent events in "primitive" and "original" terms, but the practices that restored class power to capitalist elites in the United States and elsewhere are best described as an ongoing process of accumulation by dispossession that grew rapidly under neoliberalism. In what follows, I isolate four main elements.

1. Privatization

The corporatization, commodification, and privatization of hitherto public assets have been signal features of the neoliberal project. Its primary aim has been to open up new fields for capital accumulation in domains formerly regarded off-limits to the calculus of profitability. Public utilities of all lands (water, telecommunications, transportation), social welfare provision (public housing, education, health care, pensions), public institutions (such as universities, research laboratories, prisons), and even warfare (as illustrated by the "army" of private contractors operating alongside the armed forces in Iraq) have all been privatized to some degree throughout the capitalist world.

Intellectual property rights established through the so-called TRIPS (Trade Related Aspects of Intellectual Property Rights) agreement within the WTO defines genetic materials, seed plasmas, and all manner of other products as private property. Rents for use can then be extracted from populations whose practices had played a crucial role in the development of such genetic materials. Bio-piracy is rampant, and the pillaging of the worlds stockpile of genetic resources is well under way to the benefit of a few large pharmaceutical companies. The escalating depletion of the global environmental commons (land, air, water) and proliferating habitat degradations that preclude anything but capital-intensive modes of agricultural production have likewise resulted from the wholesale commodification of nature in all its forms. The commodification (through tourism) of cultural forms, histories, and intellectual creativity entails wholesale dispossessions (the music industry is notorious for the appropriation and exploitation of grassroots culture and creativity). As in the past, the power of the state is frequently used to force such processes through even against popular will. The rolling back of regulatory frameworks designed to protect labor and the environment from degradation has entailed the loss of rights. The reversion of common property rights won through years of hard class struggle (the right to a state pension, to welfare, to national health care) into the private domain has been one of the most egregious of all policies of dispossession pursued in the name of neoliberal orthodoxy.

The corporatization, commodification, and privatization of hitherto public assets have been signal features of the neoliberal project.

All of these processes amount to the transfer of assets from the public and popular realms to the private and class-privileged domains. Privatization, Arundhati Roy argued with respect to the Indian case, entails "the transfer of productive public assets from the state to private companies. Productive assets include natural resources: earth, forest, water, air. These are the assets that the state holds in trust for the people it represents. ... To snatch these away and sell them as stock to private companies is a process of barbaric dispossession on a scale that has no parallel in history." 16

2. Financialization

The strong financial wave that set in after 1980 has been marked by its speculative and predatory style. The total daily turnover of financial transactions in international markets that stood at $2.3 billion in 1983 had risen to $130 billion by 2001. This $40 trillion annual turnover in 2001 compares to the estimated $800 billion that would be required to support international trade and productive investment flows. 17 Deregulation allowed the financial system to become one of the main centers of redistributive activity through speculation, predation, fraud, and thievery. Stock promotions; Ponzi schemes; structured asset destruction through inflation; asset stripping through mergers and acquisitions; and the promotion of debt incumbency that reduced whole populations, even in the advanced capitalist countries, to debt peonage -- to say nothing of corporate fraud and dispossession of assets, such as the raiding of pension hinds and their decimation by stock and corporate collapses through credit and stock manipulations -- are all features of the capitalist financial system.

The emphasis on stock values, which arose after bringing together the interests of owners and managers of capital through the remuneration of the latter in stock options, led, as we now know, to manipulations in the market that created immense wealth for a few at the expense of the many. The spectacular collapse of Enron was emblematic of a general process that deprived many of their livelihoods and pension rights. Beyond this, we also must look at the speculative raiding carried out by hedge funds and other major instruments of finance capital that formed the real cutting edge of accumulation by dispossession on the global stage, even as they supposedly conferred the positive benefit to the capitalist class of spreading risks.

3. The management and manipulation of crises

Beyond the speculative and often fraudulent froth that characterizes much of neoliberal financial manipulation, there lies a deeper process that entails the springing of the debt trap as a primary means of accumulation by dispossession. Crisis creation, management, and manipulation on the world stage has evolved into the fine art of deliberative redistribution of wealth from poor countries to the rich. By suddenly raising interest rates in 1979, Paul Volcker, then chairman of the U.S. Federal Reserve, raised the proportion of foreign earnings that borrowing countries had to put to debt-interest payments. Forced into bankruptcy, countries like Mexico had to agree to structural adjustment. While proclaiming its role as a noble leader organizing bailouts to keep global capital accumulation stable and on track, the United States could also open the way to pillage the Mexican economy through deployment of its superior financial power under conditions of local crisis. This was what the U.S. Treasury/Wall Street/IMF complex became expert at doing everywhere. Volker s successor, Alan Greenspan, resorted to similar tactics several times in the 1990s. Debt crises in individual countries, uncommon in the 1960s, became frequent during the 1980s and 1990s. Hardly any developing country remained untouched and in some cases, as in Latin America, such crises were frequent enough to be considered endemic. These

debt crises were orchestrated, managed, and controlled both to rationalize the system and to redistribute assets during the 1980s and 1990s. Wade and Veneroso captured the essence of this trend when they wrote of the Asian crisis -- provoked initially by the operation of U.S.-based hedge funds -- of 1997 and 1998:

Financial crises have always caused transfers of ownership and power to those who keep their own assets intact and who are in a position to create credit, and the Asian crisis is no exception . . . there is no doubt that Western and Japanese corporations are the big winners. . . . The combination of massive devaluations pushed financial liberalization, and IMF-facilitated recovery may even precipitate the biggest peacetime transfer of assets from domestic to foreign owners in the past fifty years anywhere in the world, dwarfing the transfers from domestic to U.S. owners in Latin America in the 1980s or in Mexico after 1994. One recalls the statement attributed to Andrew Mellon: "In a depression assets return to their rightful owners." 18

The analogy to the deliberate creation of unemployment to produce a pool of low-wage surplus labor convenient for further accumulation is precise. Valuable assets are thrown out of use and lose their value. They lie fallow and dormant until capitalists possessed of liquidity choose to seize upon them and breathe new life into them. The danger, however, is that crises can spin out of control and become generalized, or that revolts will arise against the system that creates them. One of the prime functions of state interventions and of international institutions is to orchestrate crises and devaluations in ways that permit accumulation by dispossession to occur without sparking a general collapse or popular revolt. The structural adjustment program administered by the Wall Street/Treasury/ IMF complex takes care of the first function. It is the job of the comprador neoliberal state apparatus (backed by military assistance from the imperial powers) to ensure that insurrections do not occur in whichever country has been raided. Yet signs of popular revolt have emerged, first with the Zapatista uprising in Mexico in 1994 and later in the generalized discontent that informed anti-globalization movements such as the one that culminated in Seattle in 1999.

4. State redistributions

The state, once transformed into a neoliberal set of institutions, becomes a prime agent of redistributive policies, reversing the flow from upper to lower classes that had been implemented during the preceding social democratic era. It does this in the first instance through privatization schemes and cutbacks in government expenditures meant to support the social wage. Even when privatization appears as beneficial to the lower classes, the long-term effects can be negative. At first blush, for example, Thatchers program for the privatization of social housing in Britain appeared as a gift to the lower classes whose members could now convert from rental to ownership at a relatively low cost, gain control over a valuable asset, and augment their wealth. But once the transfer was accomplished, housing speculation took over particularly in prime central locations, eventually bribing or forcing low-income populations out to the periphery in cities like London and turning erstwhile working-class housing estates into centers of intense gentrification. The loss of affordable housing in central areas produced homelessness for many and extraordinarily long commutes for those who did have low-paying service jobs. The privatization of the ejidos (indigenous common property rights in land under the Mexican constitution) in Mexico, which became a central component of the neoliberal program set up during the 1990s, has had analogous effects on the Mexican peasantry, forcing many rural dwellers into the cities in search of employment. The Chinese state has taken a whole series of draconian measures through which assets have been conferred upon a small elite to the detriment of the masses.

The neoliberal state also seeks redistributions through a variety of other means such as revisions in the tax code to benefit returns on investment rather than incomes and wages, promotion of regressive elements in the tax code (such as sales taxes), displacement of state expenditures and free access to all by user fees (e.g., on higher education), and the provision of a vast array of subsidies and tax breaks to corporations. The welfare programs that now exist in the United States at federal, state, and local levels amount to a vast redirection of public moneys for corporate benefit (directly as in the case of subsidies to agribusiness and indirectly as in the case of the military-industrial sector), in much the same way that the mortgage interest rate tax deduction operates in the United States as a massive subsidy to upper-income home owners and the construction of industry. Heightened surveillance and policing and, in the case of the United States, the incarceration of recalcitrant elements in the population indicate a more sinister role of intense social control. In developing countries, where opposition to neoliberalism and accumulation by dispossession can be stronger, the role of the neoliberal state quickly assumes that of active repression even to the point of low level warfare against oppositional movements (many of which can now conveniently be designated as terrorist to garner U.S. military assistance and support) such as the Zapatistas in Mexico or landless peasants in Brazil.

In effect, reported Roy, "India's rural economy, which supports seven hundred million people, is being garroted. Farmers who produce too much are in distress, farmers who produce too little are in distress, and landless agricultural laborers are out of work as big estates and farms lay off their workers. They're all flocking to the cities in search of employment." 19 In China, the estimate is that at least half a billion people will have to be absorbed by urbanization over the next ten years if rural mayhem and revolt is to be avoided. What those migrants will do in the cities remains unclear, though the vast physical infrastructural plans now in the works will go some way to absorbing the labor surpluses released by primitive accumulation.

The redistributive tactics of neoliberalism are wide-ranging, sophisticated, frequently masked by ideological gambits, but devastating for the dignity and social well-being of vulnerable populations and territories. The wave of creative destruction neoliberalization has visited across the globe is unparalleled in the history of capitalism. Understandably, it has spawned resistance and a search for viable alternatives.

[Sep 21, 2017] After 2.5 Years, A Lawsuit To Unseal Draft Whitewater Indictments Against Hillary Gets Its Day In Court

Sep 21, 2017 | www.zerohedge.com

McClatchy points out, since March 2015 Judicial Watch has been engaged in a back and forth battle with the National Archives which argues that "the documents should be kept secret [to preserve] grand jury secrecy and Clinton's personal privacy."

Judicial Watch, a conservative watchdog group that files Freedom of Information Act requests, wants copies of the documents that the National Archives and Records Administration has declined to release. It filed a FOIA request for the documents in March 2015 and in October 2015 the group sued for the 238 pages of responsive records.

According to Judicial Watch: " The National Archives argues that the documents should be kept secret, citing grand jury secrecy and Clinton's personal privacy."

But Judicial Watch says that because so much about the Whitewater case has already been made public, "there is no secrecy or privacy left to protect."

The documents in question are alleged drafts of indictments written by Hickman Ewing, the chief deputy of Kenneth Starr, the independent counsel appointed to investigate Bill and Hillary Clinton's alleged involvement in fraudulent real estate dealings dating back to the 70's.

Ewing told investigators he drafted the indictments in April 1995. According to Judicial Watch, the documents pertain to allegations that Hillary Clinton provided false information and withheld information from those investigating the Whitewater scandal.

Meanwhile, for those who haven't been alive long enough to remember some of the original Clinton scandals dating back to the 1970's, the Whitewater scandal revolved around a series of shady real estate deals in the Ozarks, not to mention a couple of illegal, federally-insured loans, back when Bill was Governor of Arkansas.

Of course, like with all Clinton scandals, while several other people ended up in jail as a result of the FBI's Whitewater investigation, Bill and Hillary emerged unscathed. Wikipedia offers more details:

The Whitewater controversy, Whitewater scandal (or simply Whitewater), was an American political episode of the 1990s that began with an investigation into the real estate investments of Bill and Hillary Clinton and their associates, Jim McDougal and Susan McDougal, in the Whitewater Development Corporation, a failed business venture in the 1970s and 1980s.

A March 1992 New York Times article published during the 1992 U.S. presidential campaign reported that the Clintons, then governor and first lady of Arkansas, had invested and lost money in the Whitewater Development Corporation. The article stimulated the interest of L. Jean Lewis, a Resolution Trust Corporation investigator who was looking into the failure of Madison Guaranty Savings and Loan, also owned by Jim and Susan McDougal.

Lewis looked for connections between the savings and loan company and the Clintons, and on September 2, 1992, she submitted a criminal referral to the FBI naming Bill and Hillary Clinton as witnesses in the Madison Guaranty case. Little Rock U.S. Attorney Charles A. Banks and the FBI determined that the referral lacked merit, but Lewis continued to pursue the case. From 1992 to 1994, Lewis issued several additional referrals against the Clintons and repeatedly called the U.S. Attorney's Office in Little Rock and the Justice Department regarding the case. Her referrals eventually became public knowledge, and she testified before the Senate Whitewater Committee in 1995.

David Hale, the source of criminal allegations against the Clintons, claimed in November 1993 that Bill Clinton had pressured him into providing an illegal $300,000 loan to Susan McDougal, the Clintons' partner in the Whitewater land deal. The allegations were regarded as questionable because Hale had not mentioned Clinton in reference to this loan during the original FBI investigation of Madison Guaranty in 1989; only after coming under indictment himself in 1993, did Hale make allegations against the Clintons. A U.S. Securities and Exchange Commission investigation resulted in convictions against the McDougals for their role in the Whitewater project. Jim Guy Tucker, Bill Clinton's successor as governor, was convicted of fraud and sentenced to four years of probation for his role in the matter. Susan McDougal served 18 months in prison for contempt of court for refusing to answer questions relating to Whitewater.

Neither Bill Clinton nor Hillary were ever prosecuted, after three separate inquiries found insufficient evidence linking them with the criminal conduct of others related to the land deal.

Just more attempts to "criminalize behavior that is normal"...

jamesmmu , Sep 21, 2017 6:36 PM

Understanding The Battle Between The Deep State – And "One Nation Under God" – The Holy War Within The United States Of America.

http://investmentwatchblog.com/understanding-the-battle-between-the-deep...

knukles -> jamesmmu , Sep 21, 2017 7:00 PM

"National Security" Will Prevail Again. Hillary's health and mental condition are at risk.

Hillary/Diezapam 2020

Holy war? FFS people, this shit's straight out of the End of Days stories or numerous religious, spiritual and philosophical belief systems. Yes, the war between good and evil is real and evil has the upper hand at the moment. Greatly has the upper hand.

Edit and More Importantly, Andre Ward's announced his retirement from boxing Man was a thing of beauty in the ring....

Four chan -> knukles , Sep 21, 2017 7:27 PM

the first work the clintons did for the cia

booboo -> Four chan , Sep 21, 2017 8:22 PM

Didn't Sandy Berger get caught stealing Clinton related documents from the National Archives?

Wonder what else he make off in his socks?

http://www.washingtonpost.com/wp-dyn/articles/A16706-2005Mar31.html

Lumberjack -> Lumberjack , Sep 21, 2017 6:48 PM

Was Hillary Clinton Fired from the Nixon Impeachment Inquiry?

https://www.cato.org/blog/was-hillary-clinton-fired-nixon-impeachment-in...

In 1999, nine years before the Calabrese interview, Zeifman told the Scripps-Howard news agency: "If I had the power to fire her, I would have fired her." In a 2008 interview on "The Neal Boortz Show," Zeifman was asked directly whether he fired her. His answer: "Well, let me put it this way. I terminated her, along with some other staff members who were ! we no longer needed, and advised her that I would not ! could not recommend her for any further positions."

Blankenstein -> YourAverageJoe , Sep 21, 2017 8:29 PM

They owned the property of what was most likely a drug smuggling operation in Paron, Arkansas.

That property has ties with the Rose law firm in Little Rock , in which Hillary Rodham Clinton was formerly a partner. While some observers believe the property was intended as an additional presidential residence - the Arkansas Democrat Gazette, for example, reported it was rumored to be a "White House West"; and contractors who worked on it whimsically tagged it "Camp Chelsea" - there are strong indications something quite different might be taking place in Paron

Simultaneous with this, residents said there was an increase in low-flying airplanes over the property. Unlike the military aircraft that occasionally fly over the area, these were "small Cessna-like" aircraft, according to Hill. He said the planes typically fly through a pass in the Cockspur Mountains on Southeast's property, several miles from the main road.

"After the planes leave, 20 to 30 minutes will go by, and small trucks and Jeeps leave the property at two different entrances," said Hill. He added that neighbors, during a flurry of aircraft activity, had logged the details, which they then passed on to federal authorities

http://www.freerepublic.com/focus/f-news/993980/posts

Blankenstein -> insanelysane , Sep 21, 2017 8:23 PM

The ones with Vince Foster's fingerprints on them?

" After nearly two years of searches and subpoenas, the White House said this evening that it had unexpectedly discovered copies of missing documents from Hillary Rodham Clinton's law firm that describe her work for a failing savings and loan association in the 1980's.

http://www.nytimes.com/1996/01/06/us/elusive-papers-of-law-firm-are-foun...

"The mysterious appearance of the billing records, which had been the specific subject of various nvestigative subpoenas for two year s, sparked intense interest about how they surfaced and where they had been"

"But Whitewater investigators believe that the billing records show significant representation. They argue that the records prove that Ms. Clinton was not only directly involved in the representation of Madison, but more specifically, in providing legal work on the fraudulent Castle Grande land deal."

"Investigators believe this suggests that, at some point, this copy was passed from Vince Foster to Hillary Clinton for her review.

In addition, investigators had the FBI conduct fingerprint analysis of the billing records. Of significance, the prints of Vince Foster and Hillary Clinton were found."

http://www.pbs.org/wgbh/pages/frontline/shows/arkansas/docs/recs.html

Rebelrebel7 , Sep 21, 2017 7:22 PM

It is extremely unfortunate that criminal behavior is now considered normal! The Clintons are responsible for that.

The Clintons were extremely guilty of Whitewater for profiteering on a failed real estate deal at Arkansas' residents expense, in addition to dozens of other crimes! I often wonder how life could be much better if the Clintons were never elected! The invasive and rampant corruption in virtually every sector of our society, has made this country 100% dysfunctional!

There had been criminal activity at the local level in government in some regions, but Clinton nationalized it, and legitimized it. Nixon was impeached, and resigned, giving people belief that nobody was above the law.

Now, Trump has not committed a single impeachable offense, and all that they ever talk about is impeachment!

I recall reading that Starr had DNC loyalties. My guess is that Republicans were more concerned with a President Gore, than a President Clinton.

Chippewa Partners , Sep 21, 2017 7:49 PM

The Rose Law Firm billings records? They were found sitting on her night stand next to her bed FFS...........

This is a great article on her prowess in cattle trading ......all of you wanna-be traders should try to emulate her ability!!!

http://www.nationalreview.com/article/436066/hillary-clintons-cattle-fut...

Anunnaki , Sep 21, 2017 8:17 PM

The real scandal is how Hellary turned 1000$ into 100k in cattle futures. They said it would be like winning the lottery two days in a row

[Sep 21, 2017] Emails Hillary Clinton Sought Russian Officials For Pay-To-Play Scheme

Sep 21, 2017 | www.mintpressnews.com

Although Hillary Clinton has blamed numerous factors and people for her loss to Donald Trump in last year's election, no one has received as much blame as the Russian government. In an effort to avoid blaming the candidate herself by turning the election results into a national scandal, accusations of Kremlin-directed meddling soon surfaced. While such accusations have largely been discredited by both computer analysts and award-winning journalists like Seymour Hersh, they continue to be repeated as the investigation into Donald Trump's alleged collusion with the Russian government picks up steam.

However, newly released Clinton emails suggest that that the former secretary of state's disdain for the Russian government is a relatively new development. The emails, obtained by conservative watchdog group Judicial Watch, show that the Russian government was included in invitations to exclusive Clinton Foundation galas that began less than two months after Clinton became the top official at the U.S. State Department.

In March of 2009, Amitabh Desai, then-Clinton Foundation director of foreign policy, sent invitations to numerous world leaders, which included Russian Prime Minister Vladimir Putin, then-Russian President Dmitry Medvedev, and former President of the Soviet Union Mikhail Gorbachev. Desai's emails were cc'd to Assistant Secretary of State Andrew Shapiro and later forwarded to top Clinton aide Jake Sullivan.

The Clinton Foundation's activities during Hillary's tenure as secretary of state have been central to the accusations that the Clinton family used their "charitable" foundation as a means of enriching themselves via a massive "Pay to Play" scheme. Emails leaked by Wikileaks, particularly the Podesta emails , offered ample evidence connecting foreign donations to the Clintons and their foundation with preferential treatment by the U.S. State Department.

[Sep 19, 2017] Time for a Conservative Anti-Monopoly Movement by Daniel Kishi

Sep 19, 2017 | www.theamericanconservative.com

Amazon, Facebook and Google: The new robber barons?

Amazon CEO Jeff Bezos in 2010. Credit: /CreativeCommons/SteveJurvetson Earlier this month Amazon, announced its plans to establish a second headquarters in North America. Rather than simply reveal which city would become its second home, the Seattle-based tech company opted instead to open a bidding war. In an eight page document published on its website, Amazon outlined the criteria for prospective suitors, and invited economic developers to submit proposals advocating for why their city or region should be the host of the new location.

Its potential arrival comes with the claim that the company will invest more than $5 billion in construction and generate up to 50,000 "high paying jobs." Mayors and governors, hard at work crafting their bids, are no doubt salivating at the mere thought of such economic activity. Journalists and editorial teams in eligible metropolises are also playing their parts, as newspapers have published a series of articles and editorials making the case for why their city should be declared the winner.

Last Tuesday Bloomberg reported that Boston was the early frontrunner, sending a wave of panic across the continent. Much to the relief of the other contenders, Amazon quickly discredited the report as misinformation, announcing in a series of tweets on Wednesday that it is "energized by the response from cities across [North America]" and that, contrary to the rumors, there are currently no front-runners on their "equal playing field."

That Amazon is "energized" should come as no surprise. Most companies would also be energized by the taxpayer-funded windfall that is likely coming its way. Reporters speculate that the winner of the sweepstakes!in no small part to the bidding war format!could be forced to cough up hundreds of millions of dollars in state and local subsidies for the privilege of hosting Amazon's expansion.

Amazon has long been the beneficiary of such subsidies, emerging in recent years as a formidable opponent to Walmart as the top recipient of corporate welfare. According to Good Jobs First, a Washington, D.C. organization dedicated to corporate and government accountability, Amazon has received more than $1 billion in local and state subsidies since 2000. With a business plan dedicated to amassing long-term market share in lieu of short-term profits, Amazon, under the leadership of its founder and chief executive, Jeff Bezos, operates on razor-thin profit margins in most industries, while actually operating at a loss in others. As such, these state and local subsidies have played an instrumental role in Amazon's growth

Advocates of free market enterprise should be irate over the company's crony capitalist practices and the cities and states that enable it. But more so than simply ruffling the feathers of the libertarian-minded, Amazon's shameless solicitation for subsidies capped off a series of summer skirmishes in the Democratic left's emerging war against monopolies.

Earlier this summer when Amazon announced its $13.7 billion purchase of Whole Foods, antitrust advocates called upon the Department of Justice and the Federal Trade Commission's Antitrust Division to block the sale and update the United States government's legal definition of monopoly. Although the acquisition!which was approved in August!only gives Amazon a 1.5 percent market share in the grocery industry, it more importantly provides the tech giant with access to more than 450 brick-and-mortar Whole Foods locations. Critics say that these physical locations will prove invaluable to its long term plan of economic dominance, and that it is but the latest advance in the company's unprecedented control of the economy's underlying infrastructure.

Google also found itself in the crosshairs of the left's anti-monopoly faction when, in late June, the European Union imposed a $2.7 billion fine against the tech company for anti-competitive search engine manipulation in violation of its antitrust laws. The Open Markets Program of the New America Foundation subsequently published a press release applauding the EU's decision. Two months later, the Open Markets Program was axed . The former program director Barry Lynn claims that his employers caved to pressure from a corporation that has donated more than $21 million to the New America Foundation. The fallout emboldened journalists to share their experiences of being silenced by the tech giant, and underscores the influence Google exerts over think tanks and academics

Most recently, Facebook faced criticism after it was discovered that a Russian company with ties to the Kremlin purchased $100,000 in ads from the social media company in an effort to influence the 2016 presidential election. Facebook, as a result, has become the latest subject of interest in Robert Mueller's special investigation into Russian interference in last fall's election. But regardless of whether the ads influenced the outcome, the report elicited demands for transparency and oversight in a digital ad marketplace that Facebook, along with Google, dominates . By using highly sophisticated algorithms, Facebook and Google receive more than 60 percent of all digital ad revenue, threatening the financial solvency of publishers and creating a host of economic incentives that pollute editorial autonomy.

While the Democratic left!in an effort to rejuvenate its populist soul !has been at the front lines in the war against these modern-day robber barons, Stacy Mitchell, co-director of the Institute of Local Self-Reliance, suggests that opposition to corporate consolidation need not be a partisan issue. In a piece published in The Atlantic , Mitchell traces the bipartisan history of anti-monopoly sentiment in American politics. She writes :

If "monopoly" sounds like a word from another era, that's because, until recently, it was. Throughout the middle of the 20th century, the term was frequently used in newspaper headlines, campaign speeches, and State of the Union addresses delivered by Republican and Democratic presidents alike. Breaking up too-powerful companies was a bipartisan goal and on the minds of many voters. But, starting in the 1970s, the word retreated from the public consciousness. Not coincidentally, at the same time, the enforcement of anti-monopoly policy grew increasingly toothless.

Although the modern Republican Party stands accused of cozying up with corporate interests, the history of conservative thought has a rich intellectual tradition of being skeptical!if not hostile!towards economic consolidation. For conservatives and libertarians wedded to the tenets of free market orthodoxy!or for Democrats dependent on campaign contributions from a donor class of Silicon Valley tycoons!redefining the legal definition of monopoly and rekindling a bipartisan interest in antitrust enforcement are likely non-starters.

But for conservatives willing to break from the principles of free market fundamentalism, the papal encyclicals of the Roman Catholic Church, the distributist thought of Hilaire Belloc and G.K. Chesterton, the social criticism of Christopher Lasch, and the observations of agrarian essayist Wendell Berry provide an intellectual framework from which conservatives can critique and combat concentrated economic power. With a respect for robust and resilient localities and a keen understanding of the moral dangers posed by an economy perpetuated by consumerism and convenience, these writers appeal to the moral imaginations of the reader, issuing warnings about the detrimental effects that economic consolidation has on the person, the family, the community, and society at large.

The events of this summer underscore the immense political power wielded by our economy's corporate giants. To those who recognize the dangers posed by our age of consolidation, the skirmishes from this summer could serve as a rallying cry in a bipartisan war for independence from our corporate crown.

Daniel Kishi is an editorial assistant at The American Conservative . Follow him on Twitter at @DanielMKishi

[Sep 11, 2017] Around 1970 corporate managers and professionals realized that they shared the same education, background and interests with capital owners and realigned themselves, abandoning working class and a large part of lower middle class (small business owners)

Highly recommended!
Notable quotes:
"... My observation is that the New Class (professionals, lobbyists, financiers, teachers, engineers, etc.) have ruled the country in recent decades. For much of the twentieth century this class was in some tension with corporations, and used their skills at influencing government policy to help develop and protect the welfare state, since they needed the working class as a counterweight to the natural influence of corporate money and power. However, somewhere around 1970 I think this tension collapsed, since corporate managers and professionals realized that they shared the same education, background and interests. ..."
"... This "peace treaty" between former rivals allowed the whole newly enlarged New Class to swing to the right, since they really didn't particularly need the working class politically anymore. And since it is the hallmark of this class to seek prestige, power and money while transferring risk away from themselves, the middle class and blue collar community has been the natural recipient. Free trade (well, for non-professionals, anyway), neoliberalism, ruthless private equity job cutting, etc., etc. all followed very naturally. The re-alignment of the Democratic Party towards the right was a natural part of this evolution. ..."
"... They also sense that organized politics in this country – being chiefly the province of the New Class – has left them with little leverage to change any of this. ..."
"... the New Class has very strong internal solidarity – and since somebody has to pay for these little mistakes, everyone outside that class is "fair game." ..."
"... So in that sense–to the extent that you define liberal as the ideology of the New Class (neoliberal, financial-capitalistic, big corporate-friendly but opposed to non-meritocratic biases like racism, sexism, etc.) is "liberalism", I think it is reasonable to say that it has bred resistance and anger among the "losers." As far as having "failed", well, we'll see: the New Class still controls almost all the levers of power. It has many strategies for channeling lower-class anger and I think under Trump we'll see those rolled out. ..."
"... Perhaps some evolution in "the means of production" or in how governments are influenced will ultimately develop to divide or downgrade the New Class, and break its lock on the corridors of power, but I don't see it on the horizon just yet. If anyone else does, I'd love to hear more about it. ..."
"... A little puzzled by the inclusion of teachers, alongside financiers and the like, in William Meyer's list of the New Class rulers. Enablers of those rulers, no doubt, but not visibly calling the shots. But then I'm probably just another liberal elitist failing to recognize my own hegemony, like Chris. ..."
"... I assume he meant certain professors [of economics]. Actually on @4, there's a good chapter on the topic in a Thomas Franks latest. ..."
Nov 14, 2016 | crookedtimber.org

William Meyer 11.13.16 at 9:40 pm 4

Obviously Mr. Deerin is, on its face, utilizing a very disputable definition of "liberal."

However, I think a stronger case could be made for something like Mr. Deerin's argument, although it doesn't necessarily get to the same conclusion.

My observation is that the New Class (professionals, lobbyists, financiers, teachers, engineers, etc.) have ruled the country in recent decades. For much of the twentieth century this class was in some tension with corporations, and used their skills at influencing government policy to help develop and protect the welfare state, since they needed the working class as a counterweight to the natural influence of corporate money and power. However, somewhere around 1970 I think this tension collapsed, since corporate managers and professionals realized that they shared the same education, background and interests.

Vive la meritocracy. This "peace treaty" between former rivals allowed the whole newly enlarged New Class to swing to the right, since they really didn't particularly need the working class politically anymore. And since it is the hallmark of this class to seek prestige, power and money while transferring risk away from themselves, the middle class and blue collar community has been the natural recipient. Free trade (well, for non-professionals, anyway), neoliberalism, ruthless private equity job cutting, etc., etc. all followed very naturally. The re-alignment of the Democratic Party towards the right was a natural part of this evolution.

I think the 90% or so of the community who are not included in this class are confused and bewildered and of course rather angry about it. They also sense that organized politics in this country – being chiefly the province of the New Class – has left them with little leverage to change any of this. Watching the bailouts and lack of prosecutions during the GFC made them dimly realize that the New Class has very strong internal solidarity – and since somebody has to pay for these little mistakes, everyone outside that class is "fair game."

So in that sense–to the extent that you define liberal as the ideology of the New Class (neoliberal, financial-capitalistic, big corporate-friendly but opposed to non-meritocratic biases like racism, sexism, etc.) is "liberalism", I think it is reasonable to say that it has bred resistance and anger among the "losers." As far as having "failed", well, we'll see: the New Class still controls almost all the levers of power. It has many strategies for channeling lower-class anger and I think under Trump we'll see those rolled out.

Let me be clear, I'm not saying Donald Trump is leading an insurgency against the New Class – but I think he tapped into something like one and is riding it for all he can, while not really having the slightest idea what he's doing.

Perhaps some evolution in "the means of production" or in how governments are influenced will ultimately develop to divide or downgrade the New Class, and break its lock on the corridors of power, but I don't see it on the horizon just yet. If anyone else does, I'd love to hear more about it.

Neville Morley 11.14.16 at 7:11 am ( 31 )

A little puzzled by the inclusion of teachers, alongside financiers and the like, in William Meyer's list of the New Class rulers. Enablers of those rulers, no doubt, but not visibly calling the shots. But then I'm probably just another liberal elitist failing to recognize my own hegemony, like Chris.

http://www.theguardian.com/commentisfree/2016/nov/14/are-you-a-sinister-filthy-elite-take-this-quiz-and-find-out-now?CMP=Share_iOSApp_Other

Chris S 11.14.16 at 7:31 am

@29,

I assume he meant certain professors [of economics]. Actually on @4, there's a good chapter on the topic in a Thomas Franks latest.

[Sep 11, 2017] Around 1970 corporate managers and professionals realized that they shared the same education, background and interests with capital owners and realigned themselves, abandoning working class and a large part of lower middle class (small business owners)

Highly recommended!
Notable quotes:
"... My observation is that the New Class (professionals, lobbyists, financiers, teachers, engineers, etc.) have ruled the country in recent decades. For much of the twentieth century this class was in some tension with corporations, and used their skills at influencing government policy to help develop and protect the welfare state, since they needed the working class as a counterweight to the natural influence of corporate money and power. However, somewhere around 1970 I think this tension collapsed, since corporate managers and professionals realized that they shared the same education, background and interests. ..."
"... This "peace treaty" between former rivals allowed the whole newly enlarged New Class to swing to the right, since they really didn't particularly need the working class politically anymore. And since it is the hallmark of this class to seek prestige, power and money while transferring risk away from themselves, the middle class and blue collar community has been the natural recipient. Free trade (well, for non-professionals, anyway), neoliberalism, ruthless private equity job cutting, etc., etc. all followed very naturally. The re-alignment of the Democratic Party towards the right was a natural part of this evolution. ..."
"... They also sense that organized politics in this country – being chiefly the province of the New Class – has left them with little leverage to change any of this. ..."
"... the New Class has very strong internal solidarity – and since somebody has to pay for these little mistakes, everyone outside that class is "fair game." ..."
"... So in that sense–to the extent that you define liberal as the ideology of the New Class (neoliberal, financial-capitalistic, big corporate-friendly but opposed to non-meritocratic biases like racism, sexism, etc.) is "liberalism", I think it is reasonable to say that it has bred resistance and anger among the "losers." As far as having "failed", well, we'll see: the New Class still controls almost all the levers of power. It has many strategies for channeling lower-class anger and I think under Trump we'll see those rolled out. ..."
"... Perhaps some evolution in "the means of production" or in how governments are influenced will ultimately develop to divide or downgrade the New Class, and break its lock on the corridors of power, but I don't see it on the horizon just yet. If anyone else does, I'd love to hear more about it. ..."
"... A little puzzled by the inclusion of teachers, alongside financiers and the like, in William Meyer's list of the New Class rulers. Enablers of those rulers, no doubt, but not visibly calling the shots. But then I'm probably just another liberal elitist failing to recognize my own hegemony, like Chris. ..."
"... I assume he meant certain professors [of economics]. Actually on @4, there's a good chapter on the topic in a Thomas Franks latest. ..."
Nov 14, 2016 | crookedtimber.org

William Meyer 11.13.16 at 9:40 pm 4

Obviously Mr. Deerin is, on its face, utilizing a very disputable definition of "liberal."

However, I think a stronger case could be made for something like Mr. Deerin's argument, although it doesn't necessarily get to the same conclusion.

My observation is that the New Class (professionals, lobbyists, financiers, teachers, engineers, etc.) have ruled the country in recent decades. For much of the twentieth century this class was in some tension with corporations, and used their skills at influencing government policy to help develop and protect the welfare state, since they needed the working class as a counterweight to the natural influence of corporate money and power. However, somewhere around 1970 I think this tension collapsed, since corporate managers and professionals realized that they shared the same education, background and interests.

Vive la meritocracy. This "peace treaty" between former rivals allowed the whole newly enlarged New Class to swing to the right, since they really didn't particularly need the working class politically anymore. And since it is the hallmark of this class to seek prestige, power and money while transferring risk away from themselves, the middle class and blue collar community has been the natural recipient. Free trade (well, for non-professionals, anyway), neoliberalism, ruthless private equity job cutting, etc., etc. all followed very naturally. The re-alignment of the Democratic Party towards the right was a natural part of this evolution.

I think the 90% or so of the community who are not included in this class are confused and bewildered and of course rather angry about it. They also sense that organized politics in this country – being chiefly the province of the New Class – has left them with little leverage to change any of this. Watching the bailouts and lack of prosecutions during the GFC made them dimly realize that the New Class has very strong internal solidarity – and since somebody has to pay for these little mistakes, everyone outside that class is "fair game."

So in that sense–to the extent that you define liberal as the ideology of the New Class (neoliberal, financial-capitalistic, big corporate-friendly but opposed to non-meritocratic biases like racism, sexism, etc.) is "liberalism", I think it is reasonable to say that it has bred resistance and anger among the "losers." As far as having "failed", well, we'll see: the New Class still controls almost all the levers of power. It has many strategies for channeling lower-class anger and I think under Trump we'll see those rolled out.

Let me be clear, I'm not saying Donald Trump is leading an insurgency against the New Class – but I think he tapped into something like one and is riding it for all he can, while not really having the slightest idea what he's doing.

Perhaps some evolution in "the means of production" or in how governments are influenced will ultimately develop to divide or downgrade the New Class, and break its lock on the corridors of power, but I don't see it on the horizon just yet. If anyone else does, I'd love to hear more about it.

Neville Morley 11.14.16 at 7:11 am ( 31 )

A little puzzled by the inclusion of teachers, alongside financiers and the like, in William Meyer's list of the New Class rulers. Enablers of those rulers, no doubt, but not visibly calling the shots. But then I'm probably just another liberal elitist failing to recognize my own hegemony, like Chris.

http://www.theguardian.com/commentisfree/2016/nov/14/are-you-a-sinister-filthy-elite-take-this-quiz-and-find-out-now?CMP=Share_iOSApp_Other

Chris S 11.14.16 at 7:31 am

@29,

I assume he meant certain professors [of economics]. Actually on @4, there's a good chapter on the topic in a Thomas Franks latest.

[Jul 13, 2017] Progressive Democrats Resist and Submit, Retreat and Surrender by James Petras

Highly recommended!
Notable quotes:
"... "Have you ever met or talked to any Russian official or relative of any Russian banker, or any Russian or even read Gogol, now or in the past?" ..."
"... Progressives joined the FBI/CIA's 'Russian Bear' conspiracy: " Russia intervened and decided the Presidential election" – no matter that millions of workers and rural Americans had voted against Hillary Clinton, Wall Street's candidate and no matter that no evidence of direct interference was ever presented. Progressives could not accept that 'their constituents', the masses, had rejected Madame Clinton and preferred 'the Donald'. They attacked a shifty-eyed caricature of the repeatedly elected Russian President Putin as a subterfuge for attacking the disobedient 'white trash' electorate of 'Deploralandia'. ..."
"... Progressive demagogues embraced the coifed and manicured former 'Director Comey' of the FBI, and the Mr. Potato-headed Capo of the CIA and their forty thugs in making accusations without finger or footprints. ..."
"... Then Progressives turned increasingly Orwellian: Ignoring Obama's actual expulsion of over 2 million immigrant workers, they condemned Trump for promising to eventually expel 5 million more! ..."
"... Progressives, under Obama, supported seven brutal illegal wars and pressed for more, but complained when Trump continued the same wars and proposed adding a few new ones. At the same time, progressives out-militarized Trump by accusing him of being 'weak' on Russia, Iran, North Korea and China. They chided him for his lack support for Israel's suppression of the Palestinians. They lauded Trump's embrace of the Saudi war against Yemen as a stepping-stone for an assault against Iran, even as millions of destitute Yemenis were exposed to cholera. The Progressives had finally embraced a biological weapon of mass destruction, when US-supplied missiles destroyed the water systems of Yemen! ..."
"... Thank you for putting your finger on the main problem right there in the first paragraph. There were exceptions of course. I supported Dennis Kucinich in the Democratic Primary that gave us the first black etc. But I never voted for Obama. Throughout the Cheney Admin I pleaded with progressives to bolt the party. ..."
"... This is an excellent summary of the evolution of "progressives" into modern militarist fascists who tolerate identity politics diversity. There is little to add to Mr. Petras' commentary. ..."
"... Barak Obama is America's biggest con man who accomplished nothing "progressive" during eight years at the top, and didn't even try. (Obamacare is an insurance industry idea supported by most Republicans, which is why it recently survived.) Anyone who still likes Obama should read about his actions since he left office. Obama quickly signed a $65 million "book deal", which can only be a kickback since there is no way the publisher can sell enough books about his meaningless presidency to justify that sum. Obama doesn't get royalties based on sales, but gets the money up front for a book he has yet to write, and will have someone do that for him. (Book deals and speaking fees are legal forms of bribery in the USA.) ..."
"... Then Obama embarked on 100 days of ultra expensive foreign vacations with taxpayers covering the Secret Service protection costs. He didn't appear at charity fundraisers, didn't campaign for Democrats, and didn't help build homes for the poor like Jimmy Carter. He returns from vacation this week and his first speech will be at a Wall Street firm that will pay him $400,000, then he travels to Europe for more paid speeches. ..."
"... They chose power over principles. Nobel War Prize winner Obomber was a particularly egregious chameleon, hiding his sociopathy through two elections before unleashing his racist warmongering in full flower throughout his second term. ..."
"... Like a huge collective 'Monica Lewinsky' robot, the Progressives in the Democratic Party bent over and swallowed Clinton's vicious 1999 savaging of the venerable Glass Steagall Act ..."
Jul 10, 2017 | www.unz.com

Introduction

Over the past quarter century progressive writers, activists and academics have followed a trajectory from left to right – with each presidential campaign seeming to move them further to the right. Beginning in the 1990's progressives mobilized millions in opposition to wars, voicing demands for the transformation of the US's corporate for-profit medical system into a national 'Medicare For All' public program. They condemned the notorious Wall Street swindlers and denounced police state legislation and violence. But in the end, they always voted for Democratic Party Presidential candidates who pursued the exact opposite agenda.

Over time this political contrast between program and practice led to the transformation of the Progressives. And what we see today are US progressives embracing and promoting the politics of the far right.

To understand this transformation we will begin by identifying who and what the progressives are and describe their historical role. We will then proceed to identify their trajectory over the recent decades.

Progressives by Name and Posture

Progressives purport to embrace 'progress', the growth of the economy, the enrichment of society and freedom from arbitrary government. Central to the Progressive agenda was the end of elite corruption and good governance, based on democratic procedures.

Progressives prided themselves as appealing to 'reason, diplomacy and conciliation', not brute force and wars. They upheld the sovereignty of other nations and eschewed militarism and armed intervention.

Progressives proposed a vision of their fellow citizens pursuing incremental evolution toward the 'good society', free from the foreign entanglements, which had entrapped the people in unjust wars.

Progressives in Historical Perspective

In the early part of the 20th century, progressives favored political equality while opposing extra-parliamentary social transformations. They supported gender equality and environmental preservation while failing to give prominence to the struggles of workers and African Americans.

They denounced militarism 'in general' but supported a series of 'wars to end all wars' . Theodore Roosevelt and Woodrow Wilson embodied the dual policies of promoting peace at home and bloody imperial wars overseas. By the middle of the 20th century, different strands emerged under the progressive umbrella. Progressives split between traditional good government advocates and modernists who backed socio-economic reforms, civil liberties and rights.

Progressives supported legislation to regulate monopolies, encouraged collective bargaining and defended the Bill of Rights.

Progressives opposed wars and militarism in theory until their government went to war.

Lacking an effective third political party, progressives came to see themselves as the 'left wing' of the Democratic Party, allies of labor and civil rights movements and defenders of civil liberties.

Progressives joined civil rights leaders in marches, but mostly relied on legal and electoral means to advance African American rights.

Progressives played a pivotal role in fighting McCarthyism, though ultimately it was the Secretary of the Army and the military high command that brought Senator McCarthy to his knees.

Progressives provided legal defense when the social movements disrupted the House UnAmerican Activities Committee.

They popularized the legislative arguments that eventually outlawed segregation, but it was courageous Afro-American leaders heading mass movements that won the struggle for integration and civil rights.

In many ways the Progressives complemented the mass struggles, but their limits were defined by the constraints of their membership in the Democratic Party.

The alliance between Progressives and social movements peaked in the late sixties to mid-1970's when the Progressives followed the lead of dynamic and advancing social movements and community organizers especially in opposition to the wars in Indochina and the military draft.

The Retreat of the Progressives

By the late 1970's the Progressives had cut their anchor to the social movements, as the anti-war, civil rights and labor movements lost their impetus (and direction).

The numbers of progressives within the left wing of the Democratic Party increased through recruitment from earlier social movements. Paradoxically, while their 'numbers' were up, their caliber had declined, as they sought to 'fit in' with the pro-business, pro-war agenda of their President's party.

Without the pressure of the 'populist street' the 'Progressives-turned-Democrats' adapted to the corporate culture in the Party. The Progressives signed off on a fatal compromise: The corporate elite secured the electoral party while the Progressives were allowed to write enlightened manifestos about the candidates and their programs . . . which were quickly dismissed once the Democrats took office. Yet the ability to influence the 'electoral rhetoric' was seen by the Progressives as a sufficient justification for remaining inside the Democratic Party.

Moreover the Progressives argued that by strengthening their presence in the Democratic Party, (their self-proclaimed 'boring from within' strategy), they would capture the party membership, neutralize the pro-corporation, militarist elements that nominated the president and peacefully transform the party into a 'vehicle for progressive changes'.

Upon their successful 'deep penetration' the Progressives, now cut off from the increasingly disorganized mass social movements, coopted and bought out many prominent black, labor and civil liberty activists and leaders, while collaborating with what they dubbed the more malleable 'centrist' Democrats. These mythical creatures were really pro-corporate Democrats who condescended to occasionally converse with the Progressives while working for the Wall Street and Pentagon elite.

The Retreat of the Progressives: The Clinton Decade

Progressives adapted the 'crab strategy': Moving side-ways and then backwards but never forward.

Progressives mounted candidates in the Presidential primaries, which were predictably defeated by the corporate Party apparatus, and then submitted immediately to the outcome. The election of President 'Bill' Clinton launched a period of unrestrained financial plunder, major wars of aggression in Europe (Yugoslavia) and the Middle East (Iraq), a military intervention in Somalia and secured Israel's victory over any remnant of a secular Palestinian leadership as well as its destruction of Lebanon!

Like a huge collective 'Monica Lewinsky' robot, the Progressives in the Democratic Party bent over and swallowed Clinton's vicious 1999 savaging of the venerable Glass Steagall Act, thereby opening the floodgates for massive speculation on Wall Street through the previously regulated banking sector. When President Clinton gutted welfare programs, forcing single mothers to take minimum-wage jobs without provision for safe childcare, millions of poor white and minority women were forced to abandon their children to dangerous makeshift arrangements in order to retain any residual public support and access to minimal health care. Progressives looked the other way.

Progressives followed Clinton's deep throated thrust toward the far right, as he outsourced manufacturing jobs to Mexico (NAFTA) and re-appointed Federal Reserve's free market, Ayn Rand-fanatic, Alan Greenspan.

Progressives repeatedly kneeled before President Clinton marking their submission to the Democrats' 'hard right' policies.

The election of Republican President G. W. Bush (2001-2009) permitted Progressive's to temporarily trot out and burnish their anti-war, anti-Wall Street credentials. Out in the street, they protested Bush's savage invasion of Iraq (but not the destruction of Afghanistan). They protested the media reports of torture in Abu Ghraib under Bush, but not the massive bombing and starvation of millions of Iraqis that had occurred under Clinton. Progressives protested the expulsion of immigrants from Mexico and Central America, but were silent over the brutal uprooting of refugees resulting from US wars in Iraq and Afghanistan, or the systematic destruction of their nations' infrastructure.

Progressives embraced Israel's bombing, jailing and torture of Palestinians by voting unanimously in favor of increasing the annual $3 billion dollar military handouts to the brutal Jewish State. They supported Israel's bombing and slaughter in Lebanon.

Progressives were in retreat, but retained a muffled voice and inconsequential vote in favor of peace, justice and civil liberties. They kept a certain distance from the worst of the police state decrees by the Republican Administration.

Progressives and Obama: From Retreat to Surrender

While Progressives maintained their tepid commitment to civil liberties, and their highly 'leveraged' hopes for peace in the Middle East, they jumped uncritically into the highly choreographed Democratic Party campaign for Barack Obama, 'Wall Street's First Black President'.

Progressives had given up their quest to 'realign' the Democratic Party 'from within': they turned from serious tourism to permanent residency. Progressives provided the foot soldiers for the election and re-election of the warmongering 'Peace Candidate' Obama. After the election, Progressives rushed to join the lower echelons of his Administration. Black and white politicos joined hands in their heroic struggle to erase the last vestiges of the Progressives' historical legacy.

Obama increased the number of Bush-era imperial wars to attacking seven weak nations under American's 'First Black' President's bombardment, while the Progressives ensured that the streets were quiet and empty.

When Obama provided trillions of dollars of public money to rescue Wall Street and the bankers, while sacrificing two million poor and middle class mortgage holders, the Progressives only criticized the bankers who received the bailout, but not Obama's Presidential decision to protect and reward the mega-swindlers.

Under the Obama regime social inequalities within the United States grew at an unprecedented rate. The Police State Patriot Act was massively extended to give President Obama the power to order the assassination of US citizens abroad without judicial process. The Progressives did not resign when Obama's 'kill orders' extended to the 'mistaken' murder of his target's children and other family member, as well as unidentified bystanders. The icon carriers still paraded their banner of the 'first black American President' when tens of thousands of black Libyans and immigrant workers were slaughtered in his regime-change war against President Gadhafi.

Obama surpassed the record of all previous Republican office holders in terms of the massive numbers of immigrant workers arrested and expelled – 2 million. Progressives applauded the Latino protestors while supporting the policies of their 'first black President'.

Progressive accepted that multiple wars, Wall Street bailouts and the extended police state were now the price they would pay to remain part of the "Democratic coalition' (sic).

The deeper the Progressives swilled at the Democratic Party trough, the more they embraced the Obama's free market agenda and the more they ignored the increasing impoverishment, exploitation and medical industry-led opioid addiction of American workers that was shortening their lives. Under Obama, the Progressives totally abandoned the historic American working class, accepting their degradation into what Madam Hillary Clinton curtly dismissed as the 'deplorables'.

With the Obama Presidency, the Progressive retreat turned into a rout, surrendering with one flaccid caveat: the Democratic Party 'Socialist' Bernie Sanders, who had voted 90% of the time with the Corporate Party, had revived a bastardized military-welfare state agenda.

Sander's Progressive demagogy shouted and rasped on the campaign trail, beguiling the young electorate. The 'Bernie' eventually 'sheep-dogged' his supporters into the pro-war Democratic Party corral. Sanders revived an illusion of the pre-1990 progressive agenda, promising resistance while demanding voter submission to Wall Street warlord Hillary Clinton. After Sanders' round up of the motley progressive herd, he staked them tightly to the far-right Wall Street war mongering Hillary Clinton. The Progressives not only embraced Madame Secretary Clinton's nuclear option and virulent anti-working class agenda, they embellished it by focusing on Republican billionaire Trump's demagogic, nationalist, working class rhetoric which was designed to agitate 'the deplorables'. They even turned on the working class voters, dismissing them as 'irredeemable' racists and illiterates or 'white trash' when they turned to support Trump in massive numbers in the 'fly-over' states of the central US.

Progressives, allied with the police state, the mass media and the war machine worked to defeat and impeach Trump. Progressives surrendered completely to the Democratic Party and started to advocate its far right agenda. Hysterical McCarthyism against anyone who questioned the Democrats' promotion of war with Russia, mass media lies and manipulation of street protest against Republican elected officials became the centerpieces of the Progressive agenda. The working class and farmers had disappeared from their bastardized 'identity-centered' ideology.

Guilt by association spread throughout Progressive politics. Progressives embraced J. Edgar Hoover's FBI tactics: "Have you ever met or talked to any Russian official or relative of any Russian banker, or any Russian or even read Gogol, now or in the past?" For progressives, 'Russia-gate' defined the real focus of contemporary political struggle in this huge, complex, nuclear-armed superpower.

Progressives joined the FBI/CIA's 'Russian Bear' conspiracy: "Russia intervened and decided the Presidential election" – no matter that millions of workers and rural Americans had voted against Hillary Clinton, Wall Street's candidate and no matter that no evidence of direct interference was ever presented. Progressives could not accept that 'their constituents', the masses, had rejected Madame Clinton and preferred 'the Donald'. They attacked a shifty-eyed caricature of the repeatedly elected Russian President Putin as a subterfuge for attacking the disobedient 'white trash' electorate of 'Deploralandia'.

Progressive demagogues embraced the coifed and manicured former 'Director Comey' of the FBI, and the Mr. Potato-headed Capo of the CIA and their forty thugs in making accusations without finger or footprints.

The Progressives' far right - turn earned them hours and space on the mass media as long as they breathlessly savaged and insulted President Trump and his family members. When they managed to provoke him into a blind rage . . . they added the newly invented charge of 'psychologically unfit to lead' – presenting cheap psychobabble as grounds for impeachment. Finally! American Progressives were on their way to achieving their first and only political transformation: a Presidential coup d'état on behalf of the Far Right!

Progressives loudly condemned Trump's overtures for peace with Russia, denouncing it as appeasement and betrayal!

In return, President Trump began to 'out-militarize' the Progressives by escalating US involvement in the Middle East and South China Sea. They swooned with joy when Trump ordered a missile strike against the Syrian government as Damascus engaged in a life and death struggle against mercenary terrorists. They dubbed the petulant release of Patriot missiles 'Presidential'.

Then Progressives turned increasingly Orwellian: Ignoring Obama's actual expulsion of over 2 million immigrant workers, they condemned Trump for promising to eventually expel 5 million more!

Progressives, under Obama, supported seven brutal illegal wars and pressed for more, but complained when Trump continued the same wars and proposed adding a few new ones. At the same time, progressives out-militarized Trump by accusing him of being 'weak' on Russia, Iran, North Korea and China. They chided him for his lack support for Israel's suppression of the Palestinians. They lauded Trump's embrace of the Saudi war against Yemen as a stepping-stone for an assault against Iran, even as millions of destitute Yemenis were exposed to cholera. The Progressives had finally embraced a biological weapon of mass destruction, when US-supplied missiles destroyed the water systems of Yemen!

Conclusion

Progressives turned full circle from supporting welfare to embracing Wall Street; from preaching peaceful co-existence to demanding a dozen wars; from recognizing the humanity and rights of undocumented immigrants to their expulsion under their 'First Black' President; from thoughtful mass media critics to servile media megaphones; from defenders of civil liberties to boosters for the police state; from staunch opponents of J. Edgar Hoover and his 'dirty tricks' to camp followers for the 'intelligence community' in its deep state campaign to overturn a national election.

Progressives moved from fighting and resisting the Right to submitting and retreating; from retreating to surrendering and finally embracing the far right.

Doing all that and more within the Democratic Party, Progressives retain and deepen their ties with the mass media, the security apparatus and the military machine, while occasionally digging up some Bernie Sanders-type demagogue to arouse an army of voters away from effective resistance to mindless collaboration.

(Republished from The James Petras Website by permission of author or representative)

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WorkingClass > , July 12, 2017 at 9:21 pm GMT

But in the end, they always voted for Democratic Party Presidential candidates who pursued the exact opposite agenda.

Thank you for putting your finger on the main problem right there in the first paragraph. There were exceptions of course. I supported Dennis Kucinich in the Democratic Primary that gave us the first black etc. But I never voted for Obama. Throughout the Cheney Admin I pleaded with progressives to bolt the party.

This piece accurately traces the path from Progressive to Maoist. It's a pity the Republican Party is also a piece of shit. I think it was Sara Palin who said "We have two parties. Pick one." This should be our collective epitaph.

exiled off mainstreet > , July 12, 2017 at 11:20 pm GMT

This is an excellent summary of the evolution of "progressives" into modern militarist fascists who tolerate identity politics diversity. There is little to add to Mr. Petras' commentary.

alan2102 > , July 13, 2017 at 2:04 am GMT

EXCELLENT.

Astuteobservor II > , July 13, 2017 at 5:17 am GMT

at this point, are they still progressives though? they are the new far right

CCZ > , July 13, 2017 at 5:30 am GMT

"Progressives loudly condemned Trump's overtures for peace with Russia, denouncing it as appeasement and betrayal!"

Perhaps the spirit of Senator Joseph McCarthy is joyously gloating as progressives (and democrats) take their place as his heirs and successors and the 21st century incarnation of the House UnAmerican Activities Committee.

Carlton Meyer > , Website July 13, 2017 at 5:56 am GMT

The great Jimmy Dore is a big thorn for the Democrats. From my blog:

Apr 29, 2017 – Obama is Scum!

Barak Obama is America's biggest con man who accomplished nothing "progressive" during eight years at the top, and didn't even try. (Obamacare is an insurance industry idea supported by most Republicans, which is why it recently survived.) Anyone who still likes Obama should read about his actions since he left office. Obama quickly signed a $65 million "book deal", which can only be a kickback since there is no way the publisher can sell enough books about his meaningless presidency to justify that sum. Obama doesn't get royalties based on sales, but gets the money up front for a book he has yet to write, and will have someone do that for him. (Book deals and speaking fees are legal forms of bribery in the USA.)

Then Obama embarked on 100 days of ultra expensive foreign vacations with taxpayers covering the Secret Service protection costs. He didn't appear at charity fundraisers, didn't campaign for Democrats, and didn't help build homes for the poor like Jimmy Carter. He returns from vacation this week and his first speech will be at a Wall Street firm that will pay him $400,000, then he travels to Europe for more paid speeches.

Obama gets over $200,000 a year in retirement, just got a $65 million deal, so doesn't need more money. Why would a multi-millionaire ex-president fly around the globe collecting huge speaking fees from world corporations just after his political party was devastated in elections because Americans think the Democratic party represents Wall Street? The great Jimmy Dore expressed his outrage at Obama and the corrupt Democratic party in this great video.

jilles dykstra > , July 13, 2017 at 6:27 am GMT

Left in the good old days meant socialist, socialist meant that governments had the duty of redistributing income from rich to poor. Alas in Europe, after 'socialists' became pro EU and pro globalisation, they in fact became neoliberal. Both in France and the Netherlands 'socialist' parties virtually disappeared.
So what nowadays is left, does anyone know ?

Then the word 'progressive'. The word suggests improvement, but what is improvement, improvement for whom ? There are those who see the possibility for euthanasia as an improvement, there are thos who see euthanasia as a great sin.

Discussions about left and progressive are meaningless without properly defining the concepts.

Call me Deplorable > , July 13, 2017 at 12:06 pm GMT

They chose power over principles. Nobel War Prize winner Obomber was a particularly egregious chameleon, hiding his sociopathy through two elections before unleashing his racist warmongering in full flower throughout his second term. But, hey, the brother now has five mansions, collects half a mill per speech to the Chosen People on Wall Street, and parties for months at a time at exclusive resorts for billionaires only.

Obviously, he's got the world by the tail and you don't. Hope he comes to the same end as Gaddaffi and Ceaușescu. Maybe the survivors of nuclear Armageddon can hold a double necktie party with Killary as the second honored guest that day.

Seamus Padraig > , July 13, 2017 at 12:10 pm GMT

@jilles dykstra

Discussions about left and progressive are meaningless without properly defining the concepts.

Properly defining the concepts would impede the system's ability to keep you confused.

Seamus Padraig > , July 13, 2017 at 12:16 pm GMT

Theodore Roosevelt and Woodrow Wilson embodied the dual policies of promoting peace at home and bloody imperial wars overseas.

You left out the other Roosevelt.

Like a huge collective 'Monica Lewinsky' robot, the Progressives in the Democratic Party bent over and swallowed Clinton's vicious 1999 savaging of the venerable Glass Steagall Act

Hilarious!

Ignoring Obama's actual expulsion of over 2 million immigrant workers, they condemned Trump for promising to eventually expel 5 million more!

This is a huge myth. All that really happened is that the INS changed some of its internal terminology to make it sound as though they were deporting more people: https://www.washingtonpost.com/news/monkey-cage/wp/2014/04/21/lies-damned-lies-and-obamas-deportation-statistics/?utm_term=.7f964acd9b0d

Stephen Paul Foster > , Website July 13, 2017 at 1:28 pm GMT

The Progressives now, failing electorally, are moving on to physical violence.

See: http://fosterspeak.blogspot.com/2017/07/trumps-would-be-assassins.html

annamaria > , July 13, 2017 at 2:22 pm GMT

@Carlton Meyer Obama, a paragon of American scoundrel

Anonymous IV > , July 13, 2017 at 2:49 pm GMT

@Seamus Padraig Agree on the bit about Obama as "deporter in chief." Even the LA Times had to admit this was misleading

http://www.latimes.com/nation/la-na-obama-deportations-20140402-story.html

so it's not just conservative conspiracy theory stuff as some might argue.

Still, the overall point of this essay isn't affected all that much. Open borders is still a "right wing" (in the sense this author uses the term) policy–pro-Wall Street, pro-Big Business. So Obama was still doing the bidding of the donor class in their quest for cheap labor.

I've seen pro-immigration types try to use the Obama-deportation thing to argue that we don't need more hardcore policies. After all, even the progressive Democrat Obama was on the ball when it came to policing our borders, right?! Who needed Trump?

Agent76 > , July 13, 2017 at 3:28 pm GMT

"Who controls the issuance of money controls the government!" Nathan Meyer Rothschild

June 13, 2016 Which Corporations Control The World?

A surprisingly small number of corporations control massive global market shares. How many of the brands below do you use?

http://www.informationclearinghouse.info/article44864.htm

"Control the oil, and you control nations. Control the food, and you control the people." Henry Kissenger

Alfa158 > , July 13, 2017 at 5:33 pm GMT

@Carlton Meyer If Jimmy keeps up these attacks on Wall Street, the Banksters, and rent-seekers he is going to get run out of the Progressive movement for dog-whistling virulent Anti-Semitism. Look at how the media screams at Trump every time he mentions Wall Street and the banks.

yeah > , July 13, 2017 at 5:46 pm GMT

Mr. Petra has penned an excellent and very astute piece. Allow me a little satire on our progressive friends, entitled "The path to hell is paved with good intentions".

The early socialist/progressive travellers were well-intentioned but naïve in their understanding of human nature and fanatical about their agenda. To move the human herd forward, they had no compulsions about resorting to harsher and harsher prodding and whipping. They felt entitled to employ these means because, so they were convinced, man has to be pushed to move forward and they, the "progressives", were the best qualified to lead the herd. Scoundrels, psychopaths, moral defectives, and sundry other rascals then joined in the whipping game, some out of the sheer joy of wielding the whip, others to better line their pockets.

So the "progressive" journey degenerates into a forced march. The march becomes the progress, becoming both the means and the end at the same time. Look at the so-called "progressive" today and you will see the fanatic and the whip-wielder, steadfast about the correctness of his beliefs. Tell him/her/it that you are a man or a woman and he retorts "No, you are free to choose, you are genderless". What if you decline such freedom? "Well, then you are a bigot, we will thrash you out of your bigotry", replies the progressive. "May I, dear Sir/Madam/Whatever, keep my hard-earned money in my pocket for my and my family's use" you ask. "No, you first have to pay for our peace-making wars, then pay for the upkeep of refugees, besides which you owe a lot of back taxes that are necessary to run this wonderful Big Government of ours that is leading you towards greener and greener pastures", shouts back the progressive.

Fed up, disgusted, and a little scared, you desperately seek a way out of this progress. "No way", scream the march leaders. "We will be forever in your ears, sometimes whispering, sometimes screaming; we will take over your brain to improve your mind; we will saturate you with images on the box 24/7 and employ all sorts of imagery to make you progress. And if it all fails, we will simply pack you and others like you in a basket of deplorables and forget about you at election time."

TheJester > , July 13, 2017 at 6:18 pm GMT

Knowing who is "progressive" and know who is "far-right" is like knowing who is "fascist" and who is not. For obvious historical reasons, the Russian like to throw the "fascist" slogan against anyone who is a non-Russian nationalist. However, I accept the eminent historian Carroll Quigley's definition of fascism as the incorporation of society and the state onto single entity on a permanent war footing. The state controls everything in a radically authoritarian social structure. As Quigley states, the Soviet Union was the most complete embodiment of fascism in WWII. In WWII Germany, on the other hand, industry retained its independence and in WWII Italy fascism was no more than an empty slogan.

Same for "progressives". Everyone wants to be "progressive", right? Who wants to be "anti-progressive"? However, at the end of the day, "progressive" through verbal slights of hand has been nothing more than a euphemism for "socialist" or, in the extreme, "communist" the verbal slight-of-hand because we don't tend to use the latter terms in American political discourse.

"Progressives" morphing into a new "far-right" in America is no more mysterious than the Soviet Union morphing from Leninism to Stalinism or, the Jewish (Trotskyite) globalists fleeing Stalinist nationalism and then morphing into, first, "Scoop" Jackson Democrats and then into Bushite Republicans.

As you might notice, the real issue is the authoritarian vs. the non-authoritarian state. In this context, an authoritarian government and social order (as in communism and neoconservatism) are practical pre-requisites necessity to force humanity to transition to their New World Order.

Again, the defining characteristic of fascism is the unitary state enforced via an authoritarian political and social structure. Ideological rigor is enforced via the police powers of the state along with judicial activism and political correctness. Ring a bell?

In the ongoing contest between Trump and the remnants of the American "progressive" movement, who are the populists and who the authoritarians? Who are the democrats and who are the fascists?

I would say that who lands where in this dichotomy is obvious.

RobinG > , July 13, 2017 at 6:19 pm GMT

@Alfa158 Is Jimmy Dore really a "Progressive?" (and what does that mean, anyway?) Isn't Jimmy's show hosted by the Young Turks Network, which is unabashedly Libertarian?

Anyway, what's so great about "the Progressive movement?" Seems to me, they're just pathetic sheepdogs for the war-crazed Dems. Jimmy should be supporting the #UNRIG movement ("Beyond Trump & Sanders") for ALL Americans:

On 1 May 2017 Cynthia McKinney, Ellen Brown, and Robert Steele launched

We the People – Unity for Integrity.

The User's Guide to the 2nd American Revolution.

Death to the Deep State.

https://www.unrig.net/manifesto/

Ben Banned > , July 13, 2017 at 9:13 pm GMT

Petras, for some reason, low balls the number of people ejected from assets when the mafia came to seize real estate in the name of the ruling class and their expensive wars, morality, the Constitution or whatever shit they could make up to fuck huge numbers of people over. Undoubtedly just like 9/11, the whole thing was planned in advance. Political whores are clearly useless when the system is at such extremes.

Banks like Capital One specialize in getting a signature and "giving" a car loan to someone they know won't be able to pay, but is simply being used, shaken down and repossessed for corporate gain. " No one held a gun to their head! " Get ready, the police state will in fact put a gun to your head.

Depending on the time period in question, which might be the case here, more than 20 million people were put out of homes and/or bankrupted with more to come. Clearly a bipartisan effort featuring widespread criminal conduct across the country – an attack on the population to sustain militarism.

peterAUS > , July 13, 2017 at 10:05 pm GMT

@yeah Nice.

If I may add:
"and you also have to dearly pay for you being white male heterosexual for oppressing all colored, all the women and all the sexually different through the history".

"And if it all fails, we will simply pack you and others like you in a basket of deplorables and forget about you at election time. If we see that you still don't get with the program we will reeducate you. Should you resist that in any way we'll incarcerate you. And, no, normal legal procedure does not work with racists/bigots/haters/whatever we don't like".

Reg Cæsar > , July 14, 2017 at 1:19 am GMT

@CCZ

"Progressives loudly condemned Trump's overtures for peace with Russia, denouncing it as appeasement and betrayal!"
Perhaps the spirit of Senator Joseph McCarthy is joyously gloating as progressives (and democrats) take their place as his heirs and successors and the 21st century incarnation of the House UnAmerican Activities Committee.

take their place as his heirs and successors and the 21st century incarnation of the House UnAmerican Activities Committee

which itself was a progressive invention. There was no "right wing" anywhere in sight when it was estsblished in 1938.

[Jun 26, 2017] After the collapse of the USSR neoliberal vultures instantly circled the corpse and have had a feast. Geopolitical goals of the USA played important role in amplifying the scope of plunder of Russia

Notable quotes:
"... The reasoning was simple and is not hard to understand: Carthago delenda est. ..."
"... In a way McCain can be viewed now as a caricature of the Roman senator Cato the Elder, who is said to have used it as the conclusion to all his speeches. ..."
Jun 26, 2017 | economistsview.typepad.com

anne -> anne... , June 25, 2017 at 04:31 PM

1994

China's experience does not show that gradual reform is superior to the shock therapy undertaken in Eastern Europe and the Former Soviet Union....

-- Jeffrey Sachs and Wing Thye Woo

[ Of course, China's experience had already showed and continues all these years after just the opposite. This is very, very important. ]

libezkova -> anne... , June 26, 2017 at 08:09 AM
Your discussion just again had shown that there is no economics, only a political economy.

And all those neoliberal perversions, which are sold as an economic science is just an apologetics for the financial oligarchy.

Apologetics of plunder in this particular case.

In a way the USSR with its discredited communist ideology, degenerated Bolshevik leadership (just look at who was at the Politburo of CPSU at the time; people much lower in abilities then Trump :-) and inept and politically naïve Mikhail Gorbachev at the helm had chosen the most inopportune time to collapse :-)

And neoliberal vultures instantly circled the corpse and have had a feast. Geopolitical goals of the USA also played important role in amplifying the scope of plunder.

No comparison of performance of Russia vs. China makes any sense if it ignores this fact.

Paine -> anne... , June 25, 2017 at 06:30 PM
Lesson for the week

Deng ?
yes

Sachs ?
Nyet

anne -> Paine ... , June 25, 2017 at 07:11 PM
While I would argue with the economic advice given the Russian government after 1988, I am simply trying to understand the reasoning behind the advice, no more than that.
libezkova -> anne... , June 26, 2017 at 08:15 AM
The reasoning was simple and is not hard to understand: Carthago delenda est.

In a way McCain can be viewed now as a caricature of the Roman senator Cato the Elder, who is said to have used it as the conclusion to all his speeches.

History repeats "History repeats itself, first as tragedy, second as farce."

[Jun 26, 2017] After 1991 Eastern Europe and FSU were mercilessly looted. That was tremendous one time transfer of capital (and scientists and engineers) to Western Europe and the USA. Which helped to secure Clinton prosperity period

Notable quotes:
"... If America were a free and democratic country, with a free press and independent publishing houses (and assuming, of course, that Americans were a literate people), Williamson's book would topple the Clinton regime, the World Bank, the International Monetary Fund, and the rest of the criminal cabal that inhabits the world of modern corporate statism faster than you could say "Jonathan Hay." ..."
"... Hay, for those who need an introduction to the international financial buccaneers who control our lives, was the general director of the Harvard Institute of International Development (HIID) in Moscow (1992-1997), who facilitated the crippling of the Russian economy and the plundering of its industrial and manufacturing infrastructure with a strategy concocted by Larry Summers, Andre Schliefer (HIID's Cambridge-based manager), Jeffrey Sachs and his Swedish sidekick Anders Aslund, and a host of private players from banks and investment houses in Boston and New York - a plan approved and assisted by the U.S. Department of the Treasury. ..."
"... These third-generation Bolsheviks - led by former Pravda hack Yegor Gaidar, grandson of a Bolshevik who achieved prominence as the teenage mass murderer of White Army officers, now heads the Moscow-based Institute for Economies in Transition - became instant millionaires (or billionaires) and left the Russian workers virtual slaves of them and their new foreign investors. ..."
"... Ironically, when Harvard's Sachs and Hay started identifying Russians they could work with, they ignored - or shunned - the most capable talent at hand: those numerous Russian economists who for 20 years had been studying the Swiss economist Wilhelm von Roepke and his disciple, Ludwig Erhard, father of Germany's "economic miracle" in anticipation of the day when Communism would collapse. Somewhat sardonically, Williamson notes that one, probably unintended, benefit of Gorbachev's perestroika was the recruitment of these Russian economists by top U.S. universities. ..."
"... On another level, Contagion is about the workings of international finance, the consolidation of capital into fewer and fewer hands, and the ruthless, death-dealing policies it inflicts on its target countries through currency manipulation, inflation, depression, taxation and war - with emphasis on Russia but with attention also given to Mexico, Thailand, Indonesia, the Balkans, and other countries, and how it uses its control over money to produce social chaos. ..."
"... Those who read Williamson's book will find particularly interesting her treatment of the Federal Reserve, and how this "bank" was designed to plunder the wealth of America through war, debt, and taxation, in order to maintain what is nothing more nor less than a giant pyramid scheme that depends on domination of the earth and its resources. ..."
"... The policies inflicted on Russia by the banks were cruel to the Nth degree; but the policy implementers - Williamson employs the derogatory Russian word m yakigolovy ("soft-headed ones") applied to the Americans - were a foppish lot, streaming into Russia by the thousands (the IMF, alone, with 150 staffers) with their outrageous salaries and per diem allowances, renting out the finest dachas, bringing in their exotic consumer goods, driving up prices for goods and rents, spurring a boom in the drug and prostitution businesses, and then watching, cold-heartedly, the declining fortunes of their hosts as they lost everything - including the artistic heritage of the country. ..."
"... Gore, who was raised to be President, has impeccable Russian connections. His father, of course, was Lenin financier Armand Hammer's pocket senator, and it was Hammer who paid for Al Jr.'s expensive St. Alban's Prep schooling; and, as Williamson reports, Al Jr.'s daughter married Andrew Schiff, grandson of Jacob, who, as a member of Kuhn, Loeb & Co., underwrote anti-czarist political agitation for two decades before Lenin's coup, and congratulated Lenin upon his successful revolution. ..."
"... By March 1999, Russia was now a financial basket case, and billions, if not tens of billions of U.S. taxpayer-backed loans had vanished into the secret bank accounts of both Russian and American gangster capitalists, and the news was starting to make little vibrations on Capitol Hill. "The U.S. administration's response to the debacle was repulsively similar to a typical Bill Clinton bimbo-eruption operation: Having ruined Russia by cosseting her in debt, meddling ignorantly in her internal affairs, and funding a drunken usurper, his agents denied all error and slandered ('slimed') her," writes Williamson. ..."
"... The cost to the American taxpayers of Clinton regime bailouts in a three-and-a-half-year period, Williamson notes, is more than $180 billion! The "new financial architecture" Clinton has erected, she writes, "isn't new at all, but rather something the international public lenders have been wanting for decades, i.e., an automatic bailout for their own bad practices." ..."
"... As the extent of the corruption of the Clinton-Yeltsin "reform" plan for Russia unfolded last year, with the attendant Bank of New York scandal, the mysterious death of super banker Edmond Safra in his Monte Carlo penthouse, the collapse of the Russian stock market, and the whiplash effect in Southeast Asia, Congress was pressed to hold hearings. ..."
"... What resulted, as Williamson accurately narrates it, was just a smoke screen, show hearings that barely rose above the seriousness of a Gilbert and Sullivan farce - though they did result in proposed new domestic banking laws that, if passed, will effectively make banks another federal police force responsible for reporting to the U.S. government the most minute financial transactions of U.S. citizens. ..."
"... In this regard, it is instructive to quote Williamson at length: "If the FBI, [Manhattan District Attorney] Robert Morgenthau, or Congress were serious about getting to the bottom of the plundering of Russia's assets and U.S. taxpayers' resources, they would show far more professional interest in exactly what was said and agreed in the private meetings [U.S. Treasury secretary] Larry Summers, Strobe Talbott, and [former Treasury Secretary] Robert Rubin conducted with Anatoly Chubais [former Russian finance minister, who oversaw the distribution and sale of Russian industries], and Sergie Vasiliev [Yeltsin's principal legal adviser, and a member of the Chubais clan], and later Chubais again in June and July of 1998. ..."
"... And why did Michel Camdessus [who left the presidency of the IMF earlier this year] announce his sudden retirement so soon after Moscow newspapers reported that a $200,000 payment was made to him from a secret Kremlin bank account? . . . ..."
"... You see, as this book explains, the Clinton's Russia policy did not just plunder Russians, leaving them destitute while creating a new and ruthless class of international capitalist gangsters at U.S. taxpayer expense; it had the double consequence of bringing all Americans deeper into the bankers' New World Order by increasing their debt load, decreasing their privacy, and restricting their civil rights. If only Americans cared. ..."
Jun 25, 2017 | economistsview.typepad.com

libezkova -> anne..., June 25, 2017 at 06:47 PM

After 1991 Eastern Europe and FSU were mercilessly looted. That was tremendous one time transfer of capital (and scientists and engineers) to Western Europe and the USA. Which helped to secure "Clinton prosperity period"

China were not plundered by the West. Russia and Eastern Europe were. That's the key difference.

For Russia this period was called by Anne Williamson in her testimony before the Committee on Banking and Financial Services of the United States House of Representatives "The economic rape of Russia"

http://thebirdman.org/Index/Others/Others-Doc-Economics&Finance/+Doc-Economics&Finance-GovernmentInfluence&Meddling/BankstersInRussiaAndGlobalEconomy.htm

Paul Likoudis has an interesting analysis of this event: https://paullikoudis.wordpress.com/2011/03/24/the-plunder-of-russia-in-the-1990s/

Sorry long quote

How Clinton & Company & The Bankers Plundered Russia by Paul Likoudis

May 4, 2000

The other day I was surprised to learn that Jeffrey Sachs, the creator of "shock therapy" capitalism, who participated in the looting of Russia in the 1990s, is now NY Gov. Andrew Cuomo's top adviser for health care. So we in NY will get shock therapy, much as the Russians did two decades ago. Here is a story I wrote for The Wanderer in 2000:

===

How Clinton & Company & The Bankers Plundered Russia

by Paul Likoudis

In an ordinary election year, Anne Williamson's Contagion would be political dynamite, a bombshell, a block-buster, a regime breaker.

If America were a free and democratic country, with a free press and independent publishing houses (and assuming, of course, that Americans were a literate people), Williamson's book would topple the Clinton regime, the World Bank, the International Monetary Fund, and the rest of the criminal cabal that inhabits the world of modern corporate statism faster than you could say "Jonathan Hay."

Hay, for those who need an introduction to the international financial buccaneers who control our lives, was the general director of the Harvard Institute of International Development (HIID) in Moscow (1992-1997), who facilitated the crippling of the Russian economy and the plundering of its industrial and manufacturing infrastructure with a strategy concocted by Larry Summers, Andre Schliefer (HIID's Cambridge-based manager), Jeffrey Sachs and his Swedish sidekick Anders Aslund, and a host of private players from banks and investment houses in Boston and New York - a plan approved and assisted by the U.S. Department of the Treasury.

Contagion can be read on many different levels.

At its simplest, it is a breezy, slightly cynical, highly entertaining narrative of Russian history from the last months of Gorbachev's rule to April 2000 - a period which saw Russia transformed from a decaying socialist economy (which despite its shortcomings, provided a modest standard of living to its citizens) to a "managed economy" where home-grown gangsters and socialist theoreticians from the West, like Hay and his fellow Harvardian Jeffrey Sachs, delivered 2,500% inflation and indescribable poverty, and transferred the ownership of Russian industry to Western financiers.

Williamson was an eyewitness who lived on and off in Russia for more than ten years, where she reported on all things Russian for The New York Times, Th e Wall Street Journal, and a host of other equally reputable publications. She knew and interviewed just about everybody involved in this gargantuan plundering scheme: Russian politicians and businessmen, the new "gangster" capitalists and their American sponsors from the IMF, the World Bank, USAID, Credit Suisse First Boston, the CIA, the KGB - all in all, hundreds of sources who spoke candidly, often ruthlessly, of their parts in this terrible human drama.

Her account is filled with quotations from interviews with top aides of Yeltsin and Clinton, all down through the ranks of the two hierarchical societies to the proliferating mass of Russian destitute, pornographers, pimps, drug dealers, and prostitutes. Some of the principal characters, of course, refused to talk to Williamson, such as Bill Clinton's longtime friend from Oxford, Strobe Talbott, now a deputy secretary of state and, Williamson suspects, a onetime KGB operative whose claim to fame is a deceitful translation of the Khrushchev Memoirs. (A KGB colonel refused to confirm or deny to Williamson that Clinton and Talbott visited North Vietnam together in 1971 - though he did confirm their contacts with the KGB for their protests against the U.S. war in Vietnam in Moscow. See especially footnote 1, page 210.)

The 546-page book (the best part of which is the footnotes) gives a nearly day-by-day report on what happened to Russia; left unstated, but implied on every page, is the assumption that those in the United States who think what happened in Russia "can't happen here" better realize it can happen here.

Once the Clinton regime and its lapdogs in the media defined Russian thug Boris Yeltsin as a "democrat," the wholesale looting of Russia began. According to the socialist theoreticians at Harvard, Russia needed to be brought into the New World Order in a hurry; and what better way to do it than Sachs' "shock therapy" - a plan that empowered the degenerate, third-generation descendants of the original Bolsheviks by assigning them the deeds of Russia's mightiest state-owned industries - including the giant gas, oil, electrical, and telecommunications industries, the world's largest paper, iron, and steel factories, the world's richest gold, silver, diamond, and platinum mines, automobile and airplane factories, etc. - who, in turn, sold some of their shares of the properties to Westerners for a song, and pocketed the cash, while retaining control of the companies.

These third-generation Bolsheviks - led by former Pravda hack Yegor Gaidar, grandson of a Bolshevik who achieved prominence as the teenage mass murderer of White Army officers, now heads the Moscow-based Institute for Economies in Transition - became instant millionaires (or billionaires) and left the Russian workers virtual slaves of them and their new foreign investors.

When Russian members of the Supreme Soviet openly criticized the looting of the national patrimony by these new gangsters early in the U.S.-driven "reform" program, in 1993, before all Soviet institutions were destroyed, Yeltsin bombed Parliament.

Ironically, when Harvard's Sachs and Hay started identifying Russians they could work with, they ignored - or shunned - the most capable talent at hand: those numerous Russian economists who for 20 years had been studying the Swiss economist Wilhelm von Roepke and his disciple, Ludwig Erhard, father of Germany's "economic miracle" in anticipation of the day when Communism would collapse. Somewhat sardonically, Williamson notes that one, probably unintended, benefit of Gorbachev's perestroika was the recruitment of these Russian economists by top U.S. universities.

In the new, emerging global economy, it's clear that Russia is the designated center for heavy manufacturing - just as Asia is for clothing and computers - with its nearly unlimited supply of hydroelectric power, iron and steel, timber, gold and other precious metals.

This helps explain why America's political elites don't give a fig about the closing down of American industries and mines. As Williamson observes, Russia is viewed as some kind of "closet."

What is important for Western readers to understand - as Williamson reports - is that when Western banks and corporations bought these companies at bargain basement prices, they bought more than just industrial equipment. In the Soviet model, every unit of industrial production included workers' housing, churches, opera houses, schools, hospitals, supermarkets, etc., and the whole kit-and-caboodle was included in the selling price. By buying large shares of these companies, Western corporations became, ipso facto, town managers.

Another Level

On another level, Contagion is about the workings of international finance, the consolidation of capital into fewer and fewer hands, and the ruthless, death-dealing policies it inflicts on its target countries through currency manipulation, inflation, depression, taxation and war - with emphasis on Russia but with attention also given to Mexico, Thailand, Indonesia, the Balkans, and other countries, and how it uses its control over money to produce social chaos.

Those who read Williamson's book will find particularly interesting her treatment of the Federal Reserve, and how this "bank" was designed to plunder the wealth of America through war, debt, and taxation, in order to maintain what is nothing more nor less than a giant pyramid scheme that depends on domination of the earth and its resources.

Williamson is of that small but noble school of economics writers who believe that the academic field of economics is not some esoteric science that can only be comprehended by those with IQs in four digits, and she - drawing on such writers as Hayek and von Mises, Roepke and the late American Murray Rothbard - explains in layman's vocabulary the nuts and bolts of sound economic principles and the real-world effects of the Fed's policies on hapless Americans.

Contagion also serves up a severe indictment of the World Bank, the International Monetary Fund, and the other international "lending" agencies spawned by the Council on Foreign Relations and similar "councils" and "commissions" which are fronts for the big banks run by the Houses of Rockefeller, Morgan, Warburg, et al.

The policies inflicted on Russia by the banks were cruel to the Nth degree; but the policy implementers - Williamson employs the derogatory Russian word m yakigolovy ("soft-headed ones") applied to the Americans - were a foppish lot, streaming into Russia by the thousands (the IMF, alone, with 150 staffers) with their outrageous salaries and per diem allowances, renting out the finest dachas, bringing in their exotic consumer goods, driving up prices for goods and rents, spurring a boom in the drug and prostitution businesses, and then watching, cold-heartedly, the declining fortunes of their hosts as they lost everything - including the artistic heritage of the country.

Williamson describes brilliantly that heady atmosphere in Moscow in the early days of the IMF/USAID loan-scamming: a 24-hour party. There were bars like the Canadian-operated Hungry Duck, which lured Russian teenage girls into its bar with a male striptease and free drinks, "who, once thoroughly intoxicated, were then exposed to crowds of anxious young men the club admitted only late in the evening."

The Third Level

At a third and more intriguing level, Contagion is about America's criminal politics in the Clinton regime, and, inevitably, the reader will put Williamson's book down with the sense that Al Gore will be the next occupier of the White House.

Gore, who was raised to be President, has impeccable Russian connections. His father, of course, was Lenin financier Armand Hammer's pocket senator, and it was Hammer who paid for Al Jr.'s expensive St. Alban's Prep schooling; and, as Williamson reports, Al Jr.'s daughter married Andrew Schiff, grandson of Jacob, who, as a member of Kuhn, Loeb & Co., underwrote anti-czarist political agitation for two decades before Lenin's coup, and congratulated Lenin upon his successful revolution.

Williamson also documents Gore's intimate involvement with powerful Wall Street financial houses, and his New York breakfast meeting with multibillionaire George Soros (a key Russian player) just as the Russian collapse was underway.

Williamson tells an interesting story of Gore's response to the IMF/World Bank/USAID plunder of U.S. taxpayers for the purpose of hobbling Russia.

By March 1999, Russia was now a financial basket case, and billions, if not tens of billions of U.S. taxpayer-backed loans had vanished into the secret bank accounts of both Russian and American gangster capitalists, and the news was starting to make little vibrations on Capitol Hill. "The U.S. administration's response to the debacle was repulsively similar to a typical Bill Clinton bimbo-eruption operation: Having ruined Russia by cosseting her in debt, meddling ignorantly in her internal affairs, and funding a drunken usurper, his agents denied all error and slandered ('slimed') her," writes Williamson.

"Pundits and academics joined government officials in bemoaning Mother Russia's thieving ways, her bottomless corruption and constant chaos, all the while wringing their soft hands with a schoolmarm's exasperation. Russia's self-appointed democracy coach Strobe Talbott ('Pro-Consul Strobe' to the Russians) would get it right. An equally sanctimonious Albert Gore - the same Al Gore who'd been so quick to return the CIA's 1995 report detailing Viktor Chernomyrdin's and Anatoly Chubais' personal corruption with the single word 'Bullshit' scrawled across it - took the low road and sniffed that the Russians would just have to get their own economic house in order and cut their own deal with the IMF. . . ."

The cost to the American taxpayers of Clinton regime bailouts in a three-and-a-half-year period, Williamson notes, is more than $180 billion! The "new financial architecture" Clinton has erected, she writes, "isn't new at all, but rather something the international public lenders have been wanting for decades, i.e., an automatic bailout for their own bad practices."

As the extent of the corruption of the Clinton-Yeltsin "reform" plan for Russia unfolded last year, with the attendant Bank of New York scandal, the mysterious death of super banker Edmond Safra in his Monte Carlo penthouse, the collapse of the Russian stock market, and the whiplash effect in Southeast Asia, Congress was pressed to hold hearings.

What resulted, as Williamson accurately narrates it, was just a smoke screen, show hearings that barely rose above the seriousness of a Gilbert and Sullivan farce - though they did result in proposed new domestic banking laws that, if passed, will effectively make banks another federal police force responsible for reporting to the U.S. government the most minute financial transactions of U.S. citizens.

Double Effect

In this regard, it is instructive to quote Williamson at length: "If the FBI, [Manhattan District Attorney] Robert Morgenthau, or Congress were serious about getting to the bottom of the plundering of Russia's assets and U.S. taxpayers' resources, they would show far more professional interest in exactly what was said and agreed in the private meetings [U.S. Treasury secretary] Larry Summers, Strobe Talbott, and [former Treasury Secretary] Robert Rubin conducted with Anatoly Chubais [former Russian finance minister, who oversaw the distribution and sale of Russian industries], and Sergie Vasiliev [Yeltsin's principal legal adviser, and a member of the Chubais clan], and later Chubais again in June and July of 1998.

"Instead of allowing Larry Summers to ramble casually in response to questions at a banking committee hearing, the Treasury secretary should be asked exactly who suckered him - his Russian friends, his own boss [former Harvard associate Robert Rubin, his boss at Treasury who was once cochairman at Goldman Sachs], or private sector counterparts of the Working Committee on Financial Markets [a White House group whose membership is drawn from the country's main financial and market institutions: the Fed, Treasury, SEC, and the Commodities & Trading Commission]. . . . Or did he just bungle the entire matter on account of wishful thinking? Or was it gross incompetence?

"The FBI and Congress ought to be very interested in establishing for taxpayers the truth of any alleged 'national security' issues that justified allowing the Harvard Institute of International Development to privatize U.S. bilateral assistance. It too should be their brief to discover the relationship between the [Swedish wheeler-dealer and crony of Sachs, Anders] Aslund/Carnegie crowd and Treasury and exactly what influence that relationship may have had on the awarding of additional grants to Harvard without competition. On what basis did Team Clinton direct their financial donor, American International Group's (AIG) Maurice Greenberg (a man nearly as ubiquitous as any Russian oligarch in sweetheart public-funding deals), to Brunswick Brokerage when sniffing out a $300 million OPIC guarantee for a Russian investment fund. . . .

And why did Michel Camdessus [who left the presidency of the IMF earlier this year] announce his sudden retirement so soon after Moscow newspapers reported that a $200,000 payment was made to him from a secret Kremlin bank account? . . .

"American and Russian citizens can never be allowed to learn what really happened to the billions lent to Yeltsin's government; it would expose the unsavory and self-interested side of our political, financial, and media elites. . . . Instead, the [House] Banking Committee hearings will use the smoke screen of policing foreign assistance flows to pass legislation that will effectively end U.S. citizens' financial privacy while making them prisoners of their citizenship. . . . The Banking Committee will use the opportunity the Russian dirty money scandal presents to reanimate the domestic 'Know Your Customer' program, which charges domestic banks with monitoring and reporting on the financial transactions in which middle-class Americans engage. This data is collected and used by various government agencies, including the IRS; meaning that if a citizen sells the family's beat-up station wagon or their 'starter' home, the taxman is alerted immediately that the citizen's filing should reflect the greater tax obligation in that year of the sale. . . . Other data on citizens for which the government has long thirsted will also be collected by government's newest police force, the banks. . . ."

You see, as this book explains, the Clinton's Russia policy did not just plunder Russians, leaving them destitute while creating a new and ruthless class of international capitalist gangsters at U.S. taxpayer expense; it had the double consequence of bringing all Americans deeper into the bankers' New World Order by increasing their debt load, decreasing their privacy, and restricting their civil rights. If only Americans cared.

[Jun 18, 2017] Amazon is monopolist which just became bigger

Jun 18, 2017 | economistsview.typepad.com

Fred C. Dobbs , June 17, 2017 at 01:59 AM

(Is this anything?)

The Amazon-Walmart Showdown That Explains the Modern
Economy https://nyti.ms/2sxhIkx via @UpshotNYT
NYT - Neil Irwin - June 16

With Amazon buying the high-end grocery chain Whole Foods, something retail analysts have known for years is now apparent to everyone: The online retailer is on a collision course with Walmart to try to be the predominant seller of pretty much everything you buy.

Each one is trying to become more like the other - Walmart by investing heavily in its technology, Amazon by opening physical bookstores and now buying physical supermarkets. But this is more than a battle between two business titans. Their rivalry sheds light on the shifting economics of nearly every major industry, replete with winner-take-all effects and huge advantages that accrue to the biggest and best-run organizations, to the detriment of upstarts and second-fiddle players.

That in turn has been a boon for consumers but also has more worrying implications for jobs, wages and inequality.

To understand this epic shift, you can look not just to the grocery business, but also to my closet, and to another retail acquisition announced Friday morning. ...

Walmart to Buy Bonobos, Men's Wear Company, for $310 Million https://nyti.ms/2tuGhf9

paine - , June 17, 2017 at 08:10 AM
When you lose confidence in your
existing biz you buy bizes
Fred C. Dobbs - , June 17, 2017 at 10:19 AM
It turns out Neil Irwin has
a thing for fine dress shirts.
pgl - , June 17, 2017 at 10:41 AM
WTF? Amazon has not lost confidence in creating a monopsony for buying and selling stuff. It just expanded their empire to groceries.
Paine - , June 17, 2017 at 12:35 PM
Cornering as many markets as possible
is a fools mission

The problem
corporations get to keep their cash flow

Review the nonsense oil companies got into when rolling in cash
Thanks to OPEC

pgl - , June 17, 2017 at 02:38 PM
WTF? You clearly never looked at Amazon's income statement.
JohnH - , June 17, 2017 at 04:28 PM
Amazon's business model is to become the dominant intermediary between producers and consumers.

Whole Foods positions it to ideally serve this role in every local market in America...one stop shopping, whether you're buying from China or from the local Chinatown.

When a company like Amazon is capturing market share, profits don't matter, as its stock price shows.

And Bezos ownerships of the Washington Post gives him a powerful bully pulpit against anyone with thoughts about anti-trust...that and his deep pockets.

cm - , June 17, 2017 at 12:38 PM
I wouldn't call it confidence. Any line or mode of business can be grown only to a certain size. At some point S-curve effects and scale complexity lead to diminishing returns, even if the business is managed as well as it can be. Also in some cases there may simply not be enough demand for the one or few things the company does.

Then companies have to branch out into other ways of business, typically outside their current activities. Sometimes there is synergy, sometimes not, and it's just about buying market and revenue with the imagination one can manage it better to a higher rate of profit.

Paine - , June 17, 2017 at 01:31 PM
Or

They can turn into passive cash cows

cm - , June 17, 2017 at 04:40 PM
Yes, though usually there is a growth mandate imposed by management or "investors".
Paine - , June 18, 2017 at 07:11 AM
Now we are in the heart of darkness

Growth mandates
Where growth is earnings
Or revenues or market shares or

And indeed too often
management v stock holders mandates overt or tacit obtain

Gibbon1 - , June 17, 2017 at 10:19 PM
Comment over brunch: Must be getting late in the cycle. Amazon shrewdly using it's internet valuation to buy tangible things.
Paine - , June 18, 2017 at 07:11 AM
True

[May 30, 2017] The tendency toward monopoly among data gathering disrupters

May 26, 2017 | economistsview.typepad.com/economistsview
point May 26, 2017 at 05:55 AM
https://promarket.org/big-data-competition/

An enlightening discussion on the tendency toward monopoly among data gathering disrupters. Especially important seems to be the possibility of fine-grained price discrimination. While saying not all price discrimination is considered negative by economists without studying it, it does seem discrimination should be taken as prima facie evidence of monopoly.

While the article talks about monopoly and capture in this area, let me reiterate that looking around the more regular corporate ecosystem there is increasing concentration among buyers and often among suppliers that seems not to attract anti-trust attention as long as the final consumer seems to be not harmed. "Not harmed" does not include missing out on falling prices no longer competed for.

[May 27, 2017] "Markets Today Are Radically Different Than What We Believe - We Have the Façade of Competition -

May 27, 2017 | promarket.org

Valletti, who is also a Professor of Economics at the Imperial College Business School and the University of Rome Tor Vergata, discussed the EC's investigation into the Facebook-WhatsApp merger during the panel. Facebook, he said, had "lied" to European regulators about its ability to absorb WhatsApp's user data, but the larger issue was market definition.

"Would the decision on the merger have changed had the Commission known that information at the time?" asked Valletti, who joined theEC in 2016. "At the time, the Commission defined the relevant market as non-search advertising. This is a huge market. In that ocean, even Facebook doesn't have a lot of market power. If instead the market definition had been, for instance, advertising on social networks, [it's]likely theywould have concluded that Facebook would have been dominant in that particular market, and that integrating that useful information from [WhatsApp] could have enhanced its market power." Valletti also stressedthe importance of having individual-level data when discussing issues like competition at the advertising market, and not just looking at market shares.

Pasquale and Taplin, meanwhile, criticized U.S. antitrust authorities, with Taplin saying that digital platforms have "done very well because they have a certain regulatory capture" and Pasquale remarkingthat "U.S. antitrust policy is rapidly becoming a pro-trust policy."

As an example of this "pro-trust" policy, Pasquale cited the FTC's lawsuit against online contact lens retailer 1-800 Contacts . 1-800 Contacts was sued by the FTC last yearfor having reached agreements with 14 other online contact lens sellers that they would not advertise to customers who had searched for 1-800 Contacts online."You would imagine that given the power of these [companies], and given the activity in Europe and many other nations, our enforcers would be extremely concerned about these platforms. They are-they're concerned about little companies hurting the platforms," he said.

The FTC, added Pasquale, had pursued the 1-800 Contacts case aggressively. "I'm not here to comment on the merits of this case, but I think that the choice of this enforcement target speaks volumes. What does it say? It says that if small firms arebeing exploited or hurt by a big digital behemoth, or think [they]are, don't try in any way to coordinate or maintain your independence. What you should do is all combine and merge and become a giant, say, contacts firm. In the media, they should all combine and merge and maybe all be bought by Comcast, so that then they can negotiate with Google in a way that they are relatively of the same size and power. That's the pro-trust message we're getting under current non-enforcement U.S. antitrust policy."

[Apr 28, 2017] Monopolization Amazon-style

Notable quotes:
"... Eros the bittersweet ..."
Apr 28, 2017 | www.nakedcapitalism.com
Carla , April 26, 2017 at 4:11 pm

You mean if Borders had become Barnes & Noble? Well, B&N is struggling, too.

Just like Walmart, Amazon's business model ELIMINATES the competition. In my view, every Amazon purchase is a rock thrown through the window of a local retailer, large or small. Personally, if I ever throw rocks, they're going to be aimed bigger and better targets than that.

Octopii , April 26, 2017 at 7:55 pm

B&N closed their Georgetown (DC) store a couple of years ago, IIRC right before the xmas season got started. It was an oasis on a side of town that would rather sell you a $500 pair of pants dotted with embroidered lobsters. The building was a nicely reclaimed three-floor warehouse space with coffee and lounging areas, and it had become a nice excuse to go into DC and hang out.

jrs , April 26, 2017 at 4:12 pm

because noone can afford what a new (dead tree) book costs. I get everything used for a few bucks a book.

RUKidding , April 26, 2017 at 4:14 pm

but but but used books have to start as new books sometime

Uahsenaa , April 26, 2017 at 5:34 pm

I'm not sure this is entirely true. Just as an example, a trade paperback I bought in 1998 for a cover price of $12.95 (Anne Carson's Eros the bittersweet ) now has a cover price of $13.95, only a dollar more. The BLS's CPI calculator says the book should cost $19.54 in today's dollars.

That doesn't strike me as unaffordable. It's possible that if I went out and bought a copy of the book now, the printing might be worse, or the paper of a lower quality, but I cannot imagine it being much worse than the copy I already own.

Tertium Squid , April 26, 2017 at 7:31 pm

Use interlibrary loan and never buy another book at all.

[Apr 06, 2017] Inequality and the Lake Wobegon Effect

Apr 06, 2017 | economistsview.typepad.com
"Our Efforts to Deal With Tech Firms' Market Dominance in the U.S. Have Been an Abject Failure" : ...Q: The five largest internet and tech companies-Apple, Google, Amazon, Facebook, and Microsoft-have outstanding market share in their markets. Are current antitrust policies and theories able to deal with the potential problems that arise from the dominant positions of these companies and the vast data they collect on users?
Our efforts to deal with the problems in the United States have been an abject failure. ...I might note that Facebook's dominant position in the market is due in part to its role as an innovator and partly to "network externalities"... Microsoft's dominant position is also attributable in part to network externalities...
But the antitrust agencies have not taken sufficient measures to remedy abuses of this advantage.
Q: Is there a connection between the growing inequality in the U.S. and concentration, dominant firms, and winner-take-all markets?
I believe there is. The evidence of rising wealth inequality, especially through the work of Piketty and co-authors, is compelling. Less well known is evidence compiled at M.I.T. of strongly rising inequality of compensation, especially at the top executive levels. The nexus has not to my knowledge been fully articulated.
Here's my hypothesis: In recent decades, most publicly-traded corporations, at least in the United States, have embraced executive compensation consultants to advise the board of directors on executive compensation levels. Those consultants provide data on compensation averages and distributions for companies in peer industries. But then the Lake Wobegon effect goes to work. The boards say, "Surely, our guy isn't below average," to the average reported by the compensation consultants becomes the minimum standard for compensation. If each top executive receives at least the minimum reported pay and often more, the average rises steadily.
Indeed, and here I tread on weaker ground, those compensation costs are built into the costs considered by companies in their product pricing decisions (in a kind of rent-seeking model), and so price levels rise to accommodate rising compensation. I might note that this dynamic applies not only for chief executives, but trickles down to embrace most of companies' management personnel. ...
JohnH , March 22, 2017 at 11:04 AM
As I said a couple days ago, "Good to see economists finally addressing issues that John Kenneth Galbraith raised 50 years ago...but were largely ignored since then by 'librul' economists who didn't want to cross the folks who had funded their academic chairs."

For the past 40 years, corporate strategic planning has been all about market dominance. Back in the late 1970s Harvard Business School professor Michael Porter was all the rage along with the Boston Consulting Group, Mitt Romney's Bain Capital, and GE's Jack Welch. the mantra was that if you couldn't dominate a market, best get out. Weaker players were tolerated mostly to allay anti-trust intrusion.

Meanwhile, Republicans tacitly supported it, Democrats turned a blind eye, and 'librul' economists were off doing whatever they do.

Maximilian , March 22, 2017 at 12:44 PM
Evidence in support of Sherer's hypothesis can be found in Tom DiPrete et al's 2010 article in AJS: Compensation Benchmarking, Leapfrogs, and the Surge in Executive Pay. They write: "Scholars frequently argue whether the sharp rise in chief executive officer (CEO) pay in recent years is "efficient" or is a consequence of "rent extraction" because of the failure of corporate governance in individual firms. This article argues that governance failure must be conceptualized at the market rather than the firm level because excessive pay increases for even relatively few CEOs a year spread to other firms through the cognitively and rhetorically constructed compensation networks of "peer groups," which are used in the benchmarking process to negotiate the compensation of CEOs. Counterfactual simulation based on Standard and Poor's ExecuComp data demonstrates that the effects of CEO "leapfrogging" potentially explain a considerable fraction of the overall upward movement of executive compensation since the early 1990s."
https://academiccommons.columbia.edu/catalog/ac%3A139538
point , March 22, 2017 at 01:08 PM
The story told is nearly exactly the one Warren Buffett has been telling since 95, maybe earlier, so I do not know who was prior.

[Mar 22, 2017] Market power in the U.S. economy today

Notable quotes:
"... Labor market anyone -- where market power also translates to political power -- if labor has decent market power? Toothless (as in no penalty for crushing unions for 80 years) institutions are the reality. ..."
"... Do you guys ever talk about anything other but what the other guys talk about? ..."
Mar 22, 2017 | economistsview.typepad.com
Overview The U.S. economy has a "market power" problem, notwithstanding our strong and extensive antitrust institutions. The surprising conjunction of the exercise of market power with well-established antitrust norms, precedents, and enforcement institutions is the central paradox of U.S. competition policy today. Market power in the U.S. economy today : As this policy brief explains, the harms from the exercise of firms' market power may extend beyond individual markets affected to include slower overall economic growth and increased economic inequality. The implications for future economic productivity and welfare are troubling, but before detailing these consequences, it is necessary to understand why market power is a major issue despite well-established antitrust enforcement institutions and legal precedents. ...

anne : , March 20, 2017 at 11:34 AM

https://promarket.org/convincing-evidence-concentration-rising/

March 19, 2017

"There Is Convincing Evidence That Concentration Has Been Rising"
Interview of John E. Kwoka

mulp : , March 20, 2017 at 12:26 PM
Five Walmarts competing with each other would not raise worker wages above the wages Walmart pays. In fact, it would lower wages.

I remember Milton Friedman's Newsweek columns circa 1970 which are deep behind a paywall so I can't even find a date and title.

I remember one where he argued for utility deregulation and introduction of competition to lower prices of electricity and telephone service.

He argued that the PUC was captured by the utility that by regulation made a business profit only on ROIC plus a small rent on operating costs. By regulation, capital was always depreciating, thus a power plant or the wires and poles distributing power were constantly falling in value. The depreciation was an expense plus the labor costs which determined the base rate, with a 8-10% return on capital, the original labor costs of the power plant and wires and poles minus depreciation and a rent on operating labor.

So, how does a utility earn higher profit?

It must pay workers with capital to build more assets, more power plants, more and better power wires and poles. And it must pay more to workers to operate the utility.

In other words, profit increased the more paid to labor. The PUC had to approve these labor costs as prudent, but paying prevailing union wages was prudent. Thus, the utility could meet the demands of unions for higher wages, for more people on the job.

Worse, the PUC would get hammered with complaints if the utility was unreliable, so most regulators approved utility requests to build redundant power plants and build redundant power lines, plus hire redundant workers who could be put to work recovering from storm damage.

Thus, in Milton Friedman's view, government sanctioning a monopoly resulted in too much, too reliable service that paid too many workers too much money at the expense of all customers, especially customers who did not need the reliability.

Worse, the utilities were constantly trying to get customers to buy more to justify building more capital assets to increase profits.

And even worse, too many workers were paid too much which resulted in too much consumption, thus too much production, and that created too much demand for labor, driving up wages and increasing the number of workers, driving up I incomes and consumption.

He noted that the rush to build nuclear power plants was driven by their high capital costs and nearly purely utility labor operating costs - the utility did not pay for coal for which it got no business profit.

Thus his efforts to deregulate utilities: cutting labor costs, cutting business profits. He argued for fewer workers operating utilities and building capital assets, with economic profits driving investment decisions. Ie, a 20% profit would drive more investment, but a 5% profit would drive layoffs and cuts in reliability. Any individual who needed reliability would simply pay more to get higher reliability.

And as utilities were deregulated as he called or as best as it could be done, we have seen job losses, pay cuts, higher unreliability, sometimes bankruptcy, and other times extremely high profits, often both at the same time. When PURPA was implemented by States and utilities forced to sell power generation, then nuclear power plants were sold below the book capital cost, by these forced sales were deemed takings, so the losses from sales became stranded costs added to the rate base as depreciation. Meanwhile, as investment in new power plants fell, nuclear power plants became very profitable as market prices rose. So, the utility was going bankrupt after forced to sell assets while the assets were generating 20% or more on purchase price returns, but less than 10% on construction cost.

Friedman made the same argument for passenger airlines. Airlines paid high wages and had large cabin crews and most were profitable enough to work hard to increase customer demand. They got approval to offer low fares at the last minute to students and other classes of non-customers. Thanks to regulation. Then deregulation happened, and every airline but one went bankrupt, service quality declined, worker wages slashed, crews in the air and on the ground cut.

Friedman argued that everyone benefits from competition and is harmed by monopoly, especially regulated monopoly, because too many workers are paid too much, and those workers consume too much, and everyone is forced to pay too much to live.

Thus the creation of free lunch economics: Driving down prices but increasing profits will make everyone better off as those evil workers get less pay, costing consumers much less.

Workers are not valued consumers. Valued consumers are not workers.

Milton Friedman was not a worker, but a valued intellectual and consumer.

pgl -> mulp... , March 20, 2017 at 01:09 PM
"Five Walmarts competing with each other would not raise worker wages above the wages Walmart pays. In fact, it would lower wages."

So you accept the Economism view of labor markets where monopsony power does not exist? Sorry but the labor market evidence questions this perfectly competitive view of labor markets.

JohnH : , March 20, 2017 at 01:09 PM
Good to see economists finally addressing issues that John Kenneth Galbraith raised 50 years ago...but were largely ignored since then by 'librul' economists who didn't want to cross the folks who had funded their academic chairs.
pgl -> JohnH... , March 20, 2017 at 01:10 PM
So John Kenneth Galbraith was a right winger? Could you please stop this silly parade that liberal economists have never talked about what they often talk about. It is beyond pointless.
JohnH -> pgl... , March 20, 2017 at 01:45 PM
Oh, please. 'Librul' economists have mostly ignored monopoly and oligopoly for years. And Galbraith was definitely NOT a conservative, but academic economists largely ignored his valuable contributions.

Pay attention!

JohnH -> JohnH... , March 20, 2017 at 01:52 PM
As a measure of 'librul' concern about monopoly and oligopoly, Krugman talks about this even less than he talks about inequality...less than twice a year.
JohnH -> pgl... , March 20, 2017 at 07:05 PM
Market concentration, monopoly, and oligopoly aren't even listed as categories at economistsview!

Yet pgl tries to assure us that 'librul' economists take this issue seriously...guffaw, guffaw.

Flat Eric -> JohnH... , March 21, 2017 at 06:58 AM
Nor are labor economics, trade or public economics. So what?

Competition economics is still a huge and very active topic within the discipline. Indeed, the last but one Nobel winner, Jean Tirole, works extensively in this area.

Denis Drew : , March 20, 2017 at 02:08 PM
"Overview The U.S. economy has a "market power" problem, notwithstanding our strong and extensive antitrust institutions."

Labor market anyone -- where market power also translates to political power -- if labor has decent market power? Toothless (as in no penalty for crushing unions for 80 years) institutions are the reality.

Do you guys ever talk about anything other but what the other guys talk about?

point : , March 20, 2017 at 05:54 PM
"The U.S. economy has a "market power" problem, notwithstanding our strong and extensive antitrust institutions. The surprising conjunction of the exercise of market power with well-established antitrust norms, precedents, and enforcement institutions is the central paradox of U.S. competition policy today."

Left off the subsequent list of possible explanations is that the first above statement just may be false.

point -> point... , March 20, 2017 at 09:46 PM
Thinking especially about the "notwithstanding our strong and extensive antitrust institutions" part.

[Feb 21, 2017] Stockman Warns Trump Flynns Gone But They are Still Gunning For You, Donald by David Stockman

Notable quotes:
"... In any event, it was "intercepts" leaked from deep in the bowels of the CIA to the Washington Post and then amplified in a 24/7 campaign by the War Channel (CNN) that brought General Flynn down. ..."
"... But here's the thing. They were aiming at Donald J. Trump. And for all of his puffed up bluster about being the savviest negotiator on the planet, the Donald walked right into their trap, as we shall amplify momentarily. ..."
"... But let's first make the essence of the matter absolutely clear. The whole Flynn imbroglio is not about a violation of the Logan Act owing to the fact that the general engaged in diplomacy as a private citizen. ..."
"... It's about re-litigating the 2016 election based on the hideous lie that Trump stole it with the help of Vladimir Putin. In fact, Nancy Pelosi was quick to say just that: ..."
"... 'The American people deserve to know the full extent of Russia's financial, personal and political grip on President Trump and what that means for our national security,' House Minority Leader Nancy Pelosi said in a press release. ..."
"... And Senator Graham, the member of the boobsey twins who ran for President in 2016 while getting a GOP primary vote from virtually nobody, made clear that General Flynn's real sin was a potential peace overture to the Russians: ..."
"... We say good riddance to Flynn, of course, because he was a shrill anti-Iranian warmonger. But let's also not be fooled by the clinical term at the heart of the story. That is, "intercepts" mean that the Deep State taps the phone calls of the President's own closest advisors as a matter of course. ..."
"... As one writer for LawNewz noted regarding acting Attorney General Sally Yates' voyeuristic pre-occupation with Flynn's intercepted conversations, Nixon should be rolling in his grave with envy: ..."
"... Yes, that's the same career apparatchik of the permanent government that Obama left behind to continue the 2016 election by other means. And it's working. The Donald is being rapidly emasculated by the powers that be in the Imperial City due to what can only be described as an audacious and self-evident attack on Trump's Presidency by the Deep State. ..."
"... Indeed, the paper details an apparent effort by Yates to misuse her office to launch a full-scale secret investigation of her political opponents, including 'intercepting calls' of her political adversaries. ..."
"... Yet on the basis of the report's absolutely zero evidence and endless surmise, innuendo and "assessments", the Obama White House imposed another round of its silly school-boy sanctions on a handful of Putin's cronies. ..."
"... Of course, Flynn should have been telling the Russian Ambassador that this nonsense would be soon reversed! ..."
"... But here is the ultimate folly. The mainstream media talking heads are harrumphing loudly about the fact that the very day following Flynn's call -- Vladimir Putin announced that he would not retaliate against the new Obama sanctions as expected; and shortly thereafter, the Donald tweeted that Putin had shown admirable wisdom. ..."
"... That's right. Two reasonably adult statesman undertook what might be called the Christmas Truce of 2016. But like its namesake of 1914 on the bloody no man's land of the western front, the War Party has determined that the truce-makers shall not survive. ..."
"... The Donald has been warned. ..."
Feb 21, 2017 | www.zerohedge.com
Submitted via The Ron Paul Institute for Peace & Prosperity,

General Flynn's tenure in the White House was only slightly longer than that of President-elect William Henry Harrison in 1841. Actually, with just 24 days in the White House, General Flynn's tenure fell a tad short of old "Tippecanoe and Tyler Too". General Harrison actually lasted 31 days before getting felled by pneumonia.

And the circumstances were considerably more benign. It seems that General Harrison had a fondness for the same "firewater" that agitated the native Americans he slaughtered at the famous battle memorialized in his campaign slogan. In fact, during the campaign a leading Democrat newspaper skewered the old general, who at 68 was the oldest US President prior to Ronald Reagan, saying:

Give him a barrel of hard [alcoholic] cider, and a pension of two thousand [dollars] a year and he will sit the remainder of his days in his log cabin.

That might have been a good idea back then (or even now), but to prove he wasn't infirm, Harrison gave the longest inaugural address in US history (2 hours) in the midst of seriously inclement weather wearing neither hat nor coat.

That's how he got pneumonia! Call it foolhardy, but that was nothing compared to that exhibited by Donald Trump's former national security advisor.

General Flynn got the equivalent of political pneumonia by talking for hours during the transition to international leaders, including Russia's ambassador to the US, on phone lines which were bugged by the CIA Or more accurately, making calls which were "intercepted" by the very same NSA/FBI spy machinery that monitors every single phone call made in America.

Ironically, we learned what Flynn should have known about the Deep State's plenary surveillance from Edward Snowden. Alas, Flynn and Trump wanted the latter to be hung in the public square as a "traitor", but if that's the solution to intelligence community leaks, the Donald is now going to need his own rope factory to deal with the flood of traitorous disclosures directed against him.

In any event, it was "intercepts" leaked from deep in the bowels of the CIA to the Washington Post and then amplified in a 24/7 campaign by the War Channel (CNN) that brought General Flynn down.

But here's the thing. They were aiming at Donald J. Trump. And for all of his puffed up bluster about being the savviest negotiator on the planet, the Donald walked right into their trap, as we shall amplify momentarily.

But let's first make the essence of the matter absolutely clear. The whole Flynn imbroglio is not about a violation of the Logan Act owing to the fact that the general engaged in diplomacy as a private citizen.

It's about re-litigating the 2016 election based on the hideous lie that Trump stole it with the help of Vladimir Putin. In fact, Nancy Pelosi was quick to say just that:

'The American people deserve to know the full extent of Russia's financial, personal and political grip on President Trump and what that means for our national security,' House Minority Leader Nancy Pelosi said in a press release.

Yet, we should rephrase. The re-litigation aspect reaches back to the Republican primaries, too. The Senate GOP clowns who want a war with practically everybody, John McCain and Lindsey Graham, are already launching their own investigation from the Senate Armed Services committee.

And Senator Graham, the member of the boobsey twins who ran for President in 2016 while getting a GOP primary vote from virtually nobody, made clear that General Flynn's real sin was a potential peace overture to the Russians:

Sen. Lindsey Graham also said he wants an investigation into Flynn's conversations with a Russian ambassador about sanctions: "I think Congress needs to be informed of what actually Gen. Flynn said to the Russian ambassador about lifting sanctions," the South Carolina Republican told CNN's Kate Bolduan on "At This Hour. And I want to know, did Gen. Flynn do this by himself or was he directed by somebody to do it?"

We say good riddance to Flynn, of course, because he was a shrill anti-Iranian warmonger. But let's also not be fooled by the clinical term at the heart of the story. That is, "intercepts" mean that the Deep State taps the phone calls of the President's own closest advisors as a matter of course.

This is the real scandal as Trump himself has rightly asserted. The very idea that the already announced #1 national security advisor to a President-elect should be subject to old-fashion "bugging," albeit with modern day technology, overwhelmingly trumps the utterly specious Logan Act charge at the center of the case.

As one writer for LawNewz noted regarding acting Attorney General Sally Yates' voyeuristic pre-occupation with Flynn's intercepted conversations, Nixon should be rolling in his grave with envy:

Now, information leaks that Sally Yates knew about surveillance being conducted against potential members of the Trump administration, and disclosed that information to others. Even Richard Nixon didn't use the government agencies themselves to do his black bag surveillance operations. Sally Yates involvement with this surveillance on American political opponents, and possibly the leaking related thereto, smacks of a return to Hoover-style tactics. As writers at Bloomberg and The Week both noted, it wreaks of 'police-state' style tactics. But knowing dear Sally as I do, it comes as no surprise.

Yes, that's the same career apparatchik of the permanent government that Obama left behind to continue the 2016 election by other means. And it's working. The Donald is being rapidly emasculated by the powers that be in the Imperial City due to what can only be described as an audacious and self-evident attack on Trump's Presidency by the Deep State.

Indeed, it seems that the layers of intrigue have gotten so deep and convoluted that the nominal leadership of the permanent government machinery has lost track of who is spying on whom. Thus, we have the following curious utterance by none other than the Chairman of the House Intelligence Committee, Rep. Devin Nunes:

'I expect for the FBI to tell me what is going on, and they better have a good answer,' he told The Washington Post. 'The big problem I see here is that you have an American citizen who had his phone calls recorded.'

Well, yes. That makes 324 million of us, Congressman.

But for crying out loud, surely the oh so self-important chairman of the House intelligence committee knows that everybody is bugged. But when it reaches the point that the spy state is essentially using its unconstitutional tools to engage in what amounts to "opposition research" with the aim of election nullification, then the Imperial City has become a clear and present danger to American democracy and the liberties of the American people.

As Robert Barnes of LawNewz further explained, Sally Yates, former CIA director John Brennan and a large slice of the Never Trumper intelligence community were systematically engaged in "opposition research" during the campaign and the transition:

According to published reports, someone was eavesdropping, and recording, the conversations of Michael Flynn, while Sally Yates was at the Department of Justice. Sally Yates knew about this eavesdropping, listened in herself (Pellicano-style for those who remember the infamous LA cases), and reported what she heard to others. For Yates to have such access means she herself must have been involved in authorizing its disclosure to political appointees, since she herself is such a political appointee. What justification was there for an Obama appointee to be spying on the conversations of a future Trump appointee?

Consider this little tidbit in The Washington Post . The paper, which once broke Watergate, is now propagating the benefits of Watergate-style surveillance in ways that do make Watergate look like a third-rate effort. (With the) FBI 'routinely' monitoring conversations of Americans...... Yates listened to 'the intercepted call,' even though Yates knew there was 'little chance' of any credible case being made for prosecution under a law 'that has never been used in a prosecution.'

And well it hasn't been. After all, the Logan Act was signed by President John Adams in 1799 in order to punish one of Thomas Jefferson's supporters for having peace discussions with the French government in Paris. That is, it amounted to pre-litigating the Presidential campaign of 1800 based on sheer political motivation.

According to the Washington Post itself, that is exactly what Yates and the Obama holdovers did day and night during the interregnum:

Indeed, the paper details an apparent effort by Yates to misuse her office to launch a full-scale secret investigation of her political opponents, including 'intercepting calls' of her political adversaries.

So all of the feigned outrage emanating from Democrats and the Washington establishment about Team Trump's trafficking with the Russians is a cover story. Surely anyone even vaguely familiar with recent history would have known there was absolutely nothing illegal or even untoward about Flynn's post-Christmas conversations with the Russian Ambassador.

Indeed, we recall from personal experience the thrilling moment on inauguration day in January 1981 when word came of the release of the American hostages in Tehran. Let us assure you, that did not happen by immaculate diplomatic conception -- nor was it a parting gift to the Gipper by the outgoing Carter Administration.

To the contrary, it was the fruit of secret negotiations with the Iranian government during the transition by private American citizens. As the history books would have it because it's true, the leader of that negotiation, in fact, was Ronald Reagan's national security council director-designate, Dick Allen.

As the real Washington Post later reported, under the by-line of a real reporter, Bob Woodward:

Reagan campaign aides met in a Washington DC hotel in early October, 1980, with a self-described 'Iranian exile' who offered, on behalf of the Iranian government, to release the hostages to Reagan, not Carter, in order to ensure Carter's defeat in the November 4, 1980 election.

The American participants were Richard Allen, subsequently Reagan's first national security adviser, Allen aide Laurence Silberman, and Robert McFarlane, another future national security adviser who in 1980 was on the staff of Senator John Tower (R-TX).

To this day we have not had occasion to visit our old friend Dick Allen in the US penitentiary because he's not there; the Logan Act was never invoked in what is surely the most blatant case ever of citizen diplomacy.

So let's get to the heart of the matter and be done with it. The Obama White House conducted a sour grapes campaign to delegitimize the election beginning November 9th and it was led by then CIA Director John Brennan.

That treacherous assault on the core constitutional matter of the election process culminated in the ridiculous Russian meddling report of the Obama White House in December. The latter, of course, was issued by serial liar James Clapper, as national intelligence director, and the clueless Democrat lawyer and bag-man, Jeh Johnson, who had been appointed head of the Homeland Security Department.

Yet on the basis of the report's absolutely zero evidence and endless surmise, innuendo and "assessments", the Obama White House imposed another round of its silly school-boy sanctions on a handful of Putin's cronies.

Of course, Flynn should have been telling the Russian Ambassador that this nonsense would be soon reversed!

But here is the ultimate folly. The mainstream media talking heads are harrumphing loudly about the fact that the very day following Flynn's call -- Vladimir Putin announced that he would not retaliate against the new Obama sanctions as expected; and shortly thereafter, the Donald tweeted that Putin had shown admirable wisdom.

That's right. Two reasonably adult statesman undertook what might be called the Christmas Truce of 2016. But like its namesake of 1914 on the bloody no man's land of the western front, the War Party has determined that the truce-makers shall not survive.

The Donald has been warned.

xythras , Feb 20, 2017 10:02 PM

Assange is about to face censorship from one LENIN Moreno (next Ecuadorian president)

Assange must Reduce "Meddling" in US Policies While in Ecuadorian Embassy

http://dailywesterner.com/news/2017-02-20/assange-must-reduce-meddling-i...

How ironic

Darktarra -> xythras , Feb 20, 2017 10:11 PM

We haven't had deep state (successfully) take out a President since JFK. I am sure they will literally be gunning for Donald Trump! His election screwed up the elite's world order plans ... poor Soros ... time for him to take a dirt knap!

Be careful Trump! They will try and kill you! The United States government is COMPLETELY corrupt. Draining the swamp means its either you or they die!

wanglee -> Darktarra , Feb 20, 2017 10:18 PM

Let us help Trump's presidency to make America (not globalist) great again.

Not only democrats rigged Primary to elect Clinton as presidential candidate last year even though she has poor judgement (violating government cyber security policy) and is incompetent (her email server was not secured) when she was the Secretary of State, and was revealed to be corrupt by Bernie Sanders during the Primary, but also democrats encourage illegal immigration, discourage work, and "conned" young voters with free college/food/housing/health care/Obama phone. Democratic government employees/politicians also committed crimes to leak classified information which caused former National Security Adviser Michael Flynn losing his job and undermined Trump's presidency.

However middle/working class used their common senses voting against Clinton last November. Although I am not a republican and didn't vote in primary but I voted for Trump and those Republicans who supported Trump in last November since I am not impressed with the "integrity" and "judgement" of democrats, Anti-Trump protesters, Anti-Trump republicans, and those media who endorsed Clinton during presidential election and they'll work for globalists, the super rich, who moved jobs/investment overseas for cheap labor/tax and demanded middle/working class to pay tax to support welfare of illegal aliens and refugees who will become globalist's illegal voters and anti-Trump protesters.

To prevent/detect voter fraud, "voter ID" and "no mailing ballots" must be enforced to reduce possible "voter frauds on a massive scale" committed by democratic/republic/independent party operatives. All the sanctuary counties need to be recounted and voided county votes if recount fails since the only county which was found to count one vote many times is the only "Sanctuary" county, Wayne county, in recount states (Pennsylvania, Michigan and Wisconsin) last year. The integrity of voting equipment and voting system need to be tested, protected and audited. There were no voting equipment stuck to Trump. Yet, many voting equipment were found to switch votes to Clinton last November. Voter databases need to be kept current. Encourage reporting of "voter fraud on a massive scale" committed by political party operatives with large reward.

Cashing in: Illegal immigrants get $1,261 more welfare than American families, $5,692 vs. $4,431 ( http://www.washingtonexaminer.com/cashing-in-illegal-immigrants-get-1261... ) DEA Report Shows Infiltration of Mexican Drug Cartels in Sanctuary Cities ( http://www.breitbart.com/texas/2015/09/08/dea-report-shows-infiltration-... ) Welfare Discourages Work( http://www.breitbart.com/big-government/2015/04/27/the-science-is-settle... ) Hillary Clinton Says Bernie Sanders's "Free College" Tuition Plan Is All a Lie ( http://www.teenvogue.com/story/clinton-says-sanders-free-tuition-wont-wo... UC Berkeley Chancellor: Hillary Clinton 'Free' College Tuition Plan Won't Happen ( http://www.breitbart.com/big-government/2016/09/30/uc-berkeley-chancello... ) Bill Clinton Impeachment Chief Investigator: I'm 'Terrified' of Hillary because we know that there were "People" who "Disappeared" ( http://www.breitbart.com/2016-presidential-race/2016/10/30/exclusive-bil... ) Former FBI Asst. Director Accuses Clintons Of Being A "Crime Family" ( http://www.zerohedge.com/news/2016-10-30/former-fbi-asst-director-accuse... ) FBI boss Comey's 7 most damning lines on Clinton ( http://www.cnn.com/2016/07/05/politics/fbi-clinton-email-server-comey-da... ). Aides claiming she "could not use a computer," and didn't know her email password– New FBI docs ( https://www.rt.com/usa/360528-obama-implicated-clinton-email/ ). 23 Shocking Revelations From The FBI's Clinton Email Report ( http://dailycaller.com/2016/09/02/23-shocking-revelations-from-the-fbis-... ) DOJ grants immunity to ex-Clinton staffer who set up her email server ( http://www.cnn.com/2016/03/02/politics/hillary-clinton-email-server-just... ) Former House Intelligence Chairman: I'm '100 Percent' Sure Hillary's Server Was Hacked ( http://www.breitbart.com/2016-presidential-race/2016/11/06/former-house-... ) Exclusive - Gen. Mike Flynn: Hillary Clinton's Email Setup Was 'Unbelievable Active Criminal Behavior' ( http://www.breitbart.com/2016-presidential-race/2016/11/06/exclusive-gen... ) Clinton directed her maid to print out classified materials ( http://nypost.com/2016/11/06/clinton-directed-her-maid-to-print-out-clas... ) Obama lied to the American people about his secret communications with Clinton( http://www.thepoliticalinsider.com/president-barack-obama-hillary-email-... ) Former U.S. Attorney General, John Ashcroft: FBI didn't 'clear' Clinton ( https://www.youtube.com/watch?v=VFYQ3Cdp0zQ ) When the Clintons Loved Russia Enough to Sell Them Our Uranium ( http://www.breitbart.com/2016-presidential-race/2016/07/25/flashback-cli... ) Wikileaks: Clinton Foundation Chatter with State Dept on Uranium Deal with Russia ( http://www.breitbart.com/big-government/2016/10/08/wikileaks-putting-on-... ) Russian officials donated $$$ to Clinton Foundation for Russian military research ( http://www.breitbart.com/radio/2016/12/16/schweizer-insecure-left-wants-... ) Cash Flowed to Clinton Foundation Amid Russian Uranium Deal ( https://www.nytimes.com/2015/04/24/us/cash-flowed-to-clinton-foundation-... ) HILLARY CAMPAIGN CHIEF LINKED TO MONEY-LAUNDERING IN RUSSIA ( HTTP://WWW.WND.COM/2016/10/HILLARY-CAMPAIGN-CHIEF-LINKED-TO-MONEY-LAUNDE... ) The largest source of Trump campaign funds is small donors giving under $200 ( http://www.huffingtonpost.com/entry/donald-trump-self-fund_us_57fd4556e4... ) How mega-donors helped raise $1 billion for Hillary Clinton ( https://www.washingtonpost.com/politics/how-mega-donors-helped-raise-1-b... ) Final newspaper endorsement count: Clinton 57, Trump 2 ( http://thehill.com/blogs/ballot-box/presidential-races/304606-final-news... ) Journalists shower Hillary Clinton with campaign cash ( https://www.publicintegrity.org/2016/10/17/20330/journalists-shower-hill... ) Judicial Watch Planning to Sue FBI, NSA, CIA for Flynn Records ( http://www.breitbart.com/big-government/2017/02/16/judicial-watch-planni... )

President Trump Vowed to Investigate Voter Fraud. Then Lawmakers Voted to "Eliminate" Election Commission Charged with Helping States Improve their Voting Systems ( http://time.com/4663250/house-committee-eliminates-election-commission-v... ) California's Recipe for Voter Fraud on a Massive Scale( http://www.breitbart.com/california/2017/01/27/voter-fraud/ ) California Republican Party Official Alleges Voter Fraud In California, a "Sanctuary" state ( http://sanfrancisco.cbslocal.com/2016/11/28/trump-among-those-saying-vot... ) BREAKING: Massive Voter Fraud Discovered In Mailing Ballots In Pennsylvania! See Huge Twist In Results! ( http://www.usapoliticstoday.com/massive-voter-fraud-pennsylvania/ ) "Voting Fraud" revealed during "Recount": Scanners were used to count one vote many times to favor Clinton in Wayne County, a "Sanctuary" county including Detroit and surrounding areas.( http://www.zerohedge.com/news/2016-12-06/michigan-republicans-file-emerg... ) Illegal Voters Tipping Election Scales ( http://www.frontpagemag.com/fpm/243947/illegal-voters-tipping-election-s... ) Voter Fraud: We've Got Proof It's Easy ( http://www.nationalreview.com/article/368234/voter-fraud-weve-got-proof-... ) Voter Fraud Is Real. Here's The Proof ( http://thefederalist.com/2016/10/13/voter-fraud-real-heres-proof/ ) Here's Why State Election Officials Think Voter Fraud Is a Serious Problem ( http://dailysignal.com/2017/02/17/heres-why-state-election-officials-thi... ) Documented Voter Fraud in US ( http://www.discoverthenetworks.org/ViewSubCategory.asp?id=2216 ) No, voter fraud isn't a myth: 10 cases where it's all too real ( http://www.washingtontimes.com/news/2016/oct/17/no-voter-fraud-isnt-myth... ) Non-US citizen gets eight years for voter fraud in Texas after "Sucessfully Illegally Voted for at least Five Times" in Dallas county, a "Sanctuary" county( http://www.theblaze.com/news/2017/02/09/non-us-citizen-gets-eight-years-... ) Democratic party operatives tell us how to successfully commit voter fraud on a massive scale ( http://www.thegatewaypundit.com/2016/10/james-okeefe-rigging-elections-d... ) Texas Rigged? Reports Of Voting Machines Switching Votes To Hillary In Texas( http://www.zerohedge.com/news/2016-10-25/texas-rigged-first-reports-voti... ) Voting Machine "Irregularities" Reported in Utah, Tennessee, Pennsylvania, & North Carolina ( http://www.zerohedge.com/news/2016-11-08/voting-machine-irregularities-r... ) Video: Machine Refuses to Allow Vote For Trump in Pennsylvania ( http://www.infowars.com/video-machine-refuses-to-allow-vote-for-trump-in... ) Electoral fraud ( https://en.wikipedia.org/wiki/Electoral_fraud ) Voter fraud ( https://ballotpedia.org/Voter_fraud ) Sanctuary Cities Continue to Obstruct Enforcement, Threaten Public Safety( http://cis.org/Sanctuary-Cities-Map ) List of Sanctuary cities( http://www.apsanlaw.com/law-246.List-of-Sanctuary-cities.html ) Map Shows Sanctuary City Islands of Blue In Sea of Red ( http://www.infowars.com/map-shows-sanctuary-city-islands-of-blue-in-sea-... )

Chris Dakota -> wanglee , Feb 20, 2017 10:59 PM

I hit some long click bait about famous people IQ

Barack Obama 140

Donald Trump 156

Trump knows whats coming. Rush Limbaugh said "I've known Trump for a long time, he is a winner and I am sure none of this phases him at all. The media didn't create him, the media can't destroy him."

CheapBastard -> Darktarra , Feb 20, 2017 10:19 PM

Flynn has been there for several years. If he was such a threat why did they not take action sooner since Soweeto appointed him in 2012? It must be that Soweto Obama is his spy buddy then, both of them in league with the Russians since Obama has been with Flynn for a much longer time he had to know if something was up.

The entire Russian spy story is a complete Fake news rouse.

I am wondering what they'll say tomorrow to draw attention awya form the muslim riots in Sweden. If the news of Muslim riots in Sweden, then Trump will be even more vindicated and the MSM will look even more stupid and Fake.

Chupacabra-322 -> CheapBastard , Feb 20, 2017 10:54 PM

The Deep State has accentually lost control of the Intelligence Community via its Agents / Operatives & Presstitute Media vehicle's to Gas Light the Masses.

So what Criminals at large Obama, Clapper & Lynch have done 17 days prior to former CEO Criminal Obama leaving office was to Decentralize & weaken the NSA. As a result, Intel gathering was then regulated to the other 16 Intel Agencies.

Thus, taking Centuries Old Intelligence based on a vey stringent Centralized British Model, De Centralized it, filling the remaining 16 Intel Agenices with potential Spies and a Shadow Deep State Mirror Government.

All controlled from two blocks away at Pure Evil Criminal War Criminal Treasonous at large, former CEO Obama's Compound / Lair.

It's High Treason being conducted "Hidden In Plain View" by the Deep State.

It's the most Bizzare Transition of Power I've ever witnessed. Unprecedented.

http://www.zerohedge.com/news/2017-02-18/jay-sekulow-obama-should-be-hel ...

oncefired -> CheapBastard , Feb 20, 2017 11:07 PM

http://www.thomaswictor.com/leakers-beware/

Duc888 -> CheapBastard , Feb 20, 2017 11:11 PM

Flynn did not tell Pence that Pence's best friend was front and center on the Pizzagate list. That's what cost Flynn his job...it had fuck all do do with the elections.

[Jan 26, 2017] But Clintons negative effects were also related to the weakening the only countervailing force remaining on the way of the neoliberalism -- trade unionism. So he played the role of subversive agent in the Democratic Party. His betrayal of trade union political interests and his demoralizing role should be underestimated.

Notable quotes:
"... Most of the major changes he mentions are clearly and explicitly the consequence of policy changes, mostly by Republicans, starting with Reagan: deregulation, lower taxes on the wealthy, a lack of antitrust enforcement, and the like. ..."
Jan 26, 2017 | economistsview.typepad.com
DrDick, January 25, 2017 at 11:07 AM
This is frankly rather disingenuous. Most of the major changes he mentions are clearly and explicitly the consequence of policy changes, mostly by Republicans, starting with Reagan: deregulation, lower taxes on the wealthy, a lack of antitrust enforcement, and the like.

libezkova -> DrDick... January 25, 2017 at 09:29 PM

The first POTUS who cut tax rates was JFK.

sanjait -> DrDick... , January 25, 2017 at 11:20 AM
Read through the link and it's not nearly that simple, especially when you consider the fact that some trends, though plausibly or certainly reinforced through policy, aren't entirely or even primarily caused by policy.
DrDick -> sanjait... , January 25, 2017 at 01:45 PM
I did not say they were the *only* factors, but they are the primary causes. If you look at the timelines and data trends it is pretty clear. Reagan broke the power of the Unions and started deregulation (financialization is a consequence of this), which is the period when the big increases began. Automation plays a secondary role in this. what has happened is that the few industries which are most conducive to automation have remained here (like final assembly of automobiles), while the many, more labor intensive industries (automobile components manufacturing) have been offshored to low wage, not labor or environmental protections countries.
libezkova -> DrDick... , January 25, 2017 at 05:39 PM
Both parties participated in the conversion of the USA into neoliberal society. So it was a bipartisan move.

Clinton did a lot of dirty work in this direction and was later royally remunerated for his betrayal of the former constituency of the Democratic Party and conversion it into "yet another neoliberal party"

Obama actually continued Bush and Clinton work. He talked about 'change we can believe in' while saving Wall street and real estate speculators from jail they fully deserved.

DrDick -> libezkova... , January 25, 2017 at 07:40 PM
Clinton contributed, but the Republicans did all the real heavy lifting. I was in my late 20s and early 30s during Reagan.
libezkova -> DrDick... , January 25, 2017 at 09:25 PM
Very true. Republicans were in the vanguard and did most heavy lifting. That's undeniable.

But Clinton's negative effects were also related to the weakening the only countervailing force remaining on the way of the neoliberalism -- trade unionism. So he played the role of "subversive agent" in the Democratic Party. His betrayal of trade union political interests and his demoralizing role should be underestimated.

[Jan 20, 2017] The Clinton Foundation Is Dead - But The Case Against Hillary Isn't

Jan 19, 2017 | www.investors.com

hile everyone's been gearing up for President Trump's inauguration, the Clinton Foundation made a major announcement this week that went by with almost no notice: For all intents and purposes, it's closing its doors.

In a tax filing, the Clinton Global Initiative said it's firing 22 staffers and closing its offices, a result of the gusher of foreign money that kept the foundation afloat suddenly drying up after Hillary Clinton failed to win the presidency.

It proves what we've said all along: The Clinton Foundation was little more than an influence-peddling scheme to enrich the Clintons, and had little if anything to do with "charity," either overseas or in the U.S. That sound you heard starting in November was checkbooks being snapped shut in offices around the world by people who had hoped their donations would buy access to the next president of the United States.

And why not? There was a strong precedent for it in Hillary Clinton's tenure as secretary of state. While serving as the nation's top diplomat, the Clinton Foundation took money from at least seven foreign governments - a clear breach of Clinton's pledge on taking office that there would be total separation between her duties and the foundation.

Is there a smoking gun? Well, of the 154 private interests who either officially met or had scheduled phone talks with Hillary Clinton while she was secretary of state, at least 85 were donors to the Clinton Foundation or one of its programs.

... ... ...

Using the Freedom of Information Act, Judicial Watch in August obtained emails (that had been hidden from investigators) showing that Clinton's top State Department aide, Huma Abedin, had given "special expedited access to the secretary of state" for those who gave $25,000 to $10 million to the Clinton Foundation. Many of those were facilitated by a former executive of the foundation, Doug Band, who headed Teneo, a shell company that managed the Clintons' affairs.

As part of this elaborate arrangement, Abedin was given special permission to work for the State Department, the Clinton Foundation and Teneo - another very clear conflict of interest.

As Judicial Watch President Tom Fitton said at the time, "These new emails confirm that Hillary Clinton abused her office by selling favors to Clinton Foundation donors."

The seedy saga doesn't end there. Indeed, there are so many facets to it, some may never be known. But there is still at least one and possibly four active federal investigations into the Clintons' supposed charity.

Americans aren't willing to forgive and forget. Earlier this month, the IBD/TIPP Poll asked Americans whether they would like President Obama to pardon Hillary for any crimes she may have committed as secretary of state, including the illegal use of an unsecured homebrew email server. Of those queried, 57% said no. So if public sentiment is any guide, the Clintons' problems may just be beginning.

Writing in the Washington Post in August of 2016, Charles Krauthammer pretty much summed up the whole tawdry tale : "The foundation is a massive family enterprise disguised as a charity, an opaque and elaborate mechanism for sucking money from the rich and the tyrannous to be channeled to Clinton Inc.," he wrote. "Its purpose is to maintain the Clintons' lifestyle (offices, travel accommodations, etc.), secure profitable connections, produce favorable publicity and reliably employ a vast entourage of retainers, ready to serve today and at the coming Clinton Restoration."

Except, now there is no Clinton Restoration. So there's no reason for any donors to give money to the foundation. It lays bare the fiction of a massive "charitable organization," and shows it for what it was: a scam to sell for cash the waning influence of the Democrats' pre-eminent power couple. As far as the charity landscape goes, the Clinton Global Initiative won't be missed.

[Jan 01, 2017] The Death of Clintonism

Twenty-five years ago, Bill Clinton almost single-handedly sold the Democratic Party to Wall Street making it the second neoliberal party in the USA (soft neoliberals) and betaying interest of working class and middle class. The political base of the party became "neoliberal intelligencia" and minority groups, such as sexual minorities, feminists (with strong lesbian bent) deceived by neoliberals part of black community (that part that did not manage to get in jail yet ;-) , etc. Clintonism (aka "soft" neoliberalism) as an ideology was dead after 2007, but still exists in zombie stage. and even counterattacks in some countries.
The author is afraid using the term "neoliberalism" like most Us MSM. Which is a shame. In this sense defeat of Hillary Clinton was just the last nail in the coffin of "soft neoliberalism" (Third Way) ideology. Tony Blair was send to dustbin of history even earlier then that. Destruction of jobs turned many members of trade unions hostile to Democrats (so much for "they have nowhere to go" Bill Clinton dirty trick) and they became easy pray of far right. In this sense Bill Clinton is the godfather of far right in the USA and he bears full personal responsibility for Trump election.
In foreign policy Clinton was a regular bloodthirsty neocon persuing glibal neoliberal empire led by the USA, with Madeline Albright as the first (but not last) warmonger female Secretary of State
Notable quotes:
"... Twenty-five years ago, Bill Clinton almost single-handedly repositioned the Democratic Party for electoral success, co-opting and defusing Republican talking points ..."
"... "New Democrat" he'd once exemplified was now extinct, a victim first of Clinton's own successes, and then of the economic and social dislocations of the globalism whose inevitability he foresaw when he predicted that Americans would one day "change jobs four or five times in their lifetimes!" ..."
"... Bill Clinton's "Third Way" ideology was also undone by sheer geopolitical realities ..."
"... ..."People thought she'd been conceived in Goldman Sachs' trading desk," says one veteran Clinton aide ..."
"... his personal and sexual misconduct in office, and his and his wife's tendency toward legalistic corner-cutting-a point Sanders also drove home, even as he disavowed any interest in "her damn emails." ..."
Dec 30, 2016 | www.politico.com

their quarter-century project to build a mutual buy-one, get-one-free Clinton dynasty has ended in her defeat, and their joint departure from the center of the national political stage they had hoped to occupy for another eight years. Their exit amounts to a finale not just for themselves, but for Clintonism as a working political ideology and electoral strategy.

Twenty-five years ago, Bill Clinton almost single-handedly repositioned the Democratic Party for electoral success, co-opting and defusing Republican talking points and moving the party toward the center on issues like welfare and a balanced budget, in the process becoming the first presidential nominee of his party since Franklin D. Roosevelt to win two consecutive terms.

... ... ...

"New Democrat" he'd once exemplified was now extinct, a victim first of Clinton's own successes, and then of the economic and social dislocations of the globalism whose inevitability he foresaw when he predicted that Americans would one day "change jobs four or five times in their lifetimes!"

Bill Clinton's "Third Way" ideology was also undone by sheer geopolitical realities -- there are almost no Blue Dog Democrats left after a generation of redistricting, primary challenges and electoral defeats in the South

...while Hillary Clinton recognized the change intellectually, she seemed unable to catch up to the practical realities of its political implications for her campaign

..."People thought she'd been conceived in Goldman Sachs' trading desk," says one veteran Clinton aide

...Obama had not only largely overlooked the concerns of white working-class voters but, with his health care overhaul, had been seen as punishing them financially to provide new benefits to the poorest Americans. Fairly or not, he lost the public argument.

...Bill Clinton himself was far from an unalloyed asset in Hillary's campaign this year. The rosy glow that had come to surround much of his post presidency, and his charitable foundation's good works around the world, receded in the face of Trump's relentless reminders of his personal and sexual misconduct in office, and his and his wife's tendency toward legalistic corner-cutting-a point Sanders also drove home, even as he disavowed any interest in "her damn emails."

[Dec 31, 2016] What Happened to Obamas Passion

This was written in 2011 but it summarizes Obama presidency pretty nicely, even today. Betrayer in chief, the master of bait and switch. That is the essence of Obama legacy. On "Great Democratic betrayal"... Obama always was a closet neoliberal and neocon. A stooge of neoliberal financial oligarchy, a puppet, if you want politically incorrect term. He just masked it well during hist first election campaigning as a progressive democrat... And he faced Romney in his second campaign, who was even worse, so after betraying American people once, he was reelected and did it twice. Much like Bush II. He like another former cocaine addict -- George W Bush has never any intention of helping American people, only oligarchy.
Notable quotes:
"... IN contrast, when faced with the greatest economic crisis, the greatest levels of economic inequality, and the greatest levels of corporate influence on politics since the Depression, Barack Obama stared into the eyes of history and chose to avert his gaze. ..."
"... We (yes, we) recognise that capitalism is the most efficient way to maximise overall prosperity and quality of life. But we also recognise that unfettered, it will ravage the environment, abuse labor, and expand income disparity until violence or tragedy (or both) ensues. ..."
"... These are the lessons we've learned since the industrial revolution, and they're the ones that we should be drawing from the past decade. We recognise that we need a strong federal government to check these tendencies, and to strike a stable, sustainable balance between prosperity, community, opportunity, wealth, justice, freedom. We need a voice to fill the moral vacuum that has allowed the Koch/Tea/Fox Party to emerge and grab power. ..."
"... Americans know this---including, of course, President Obama (see his April 13 speech at GW University). But as this article by Dr. Westen so effectively shows, Obama is incompetent to lead us back ..."
"... he is not competent to lead us back to a state of American morality, where government is the protector of those who work hard, and the provider of opportunity to all Americans. ..."
"... I've heard him called a mediator, a conciliator, a compromiser, etc. Those terms indicate someone who is bringing divergent views together and moving us along. That's part of what a leader does, though not all. Yet I don't think he's even lived up to his reputation as a mediator. ..."
"... Almost three years after I voted for Obama, I still don't know what he's doing other than trying to help the financial industry: the wealthy who benefit most from it and the technocrats who run it for them. But average working people, people like myself and my daughter and my grandson, have not been helped. We are worse off than before. And millions of unemployed and underemployed are even worse off than my family is. ..."
"... So whatever else he is (and that still remains a mystery to me), President Obama is not the leader I thought I was voting for. ..."
"... I knew that Obama was a charade early on when giving a speech about the banking failures to the nation, instead of giving the narrative Mr. Westen accurately recommended on the origins of the orgy of greed that just crippled our economy and caused suffering for millions of Americans ..."
"... He should have been condemning the craven, wanton, greed of nihilistic financial gangsters who hijacked our economy. Instead he seemed to be calling for all Americans not to hate rich people. That was not the point. Americans don't hate rich people, but they should hate rich people who acquire their wealth at the expense of the well being of an entire nation through irresponsible, avaricious, and in some instances illegal practices, and legally bribe politicians to enact laws which allow them to run amok over our economy without supervision or regulation. ..."
"... I knew then that Obama was either a political lemon, in over his head, an extremely conflict averse neurotic individual with a compulsive need for some delusional ideal of neutrality in political and social relations, or a political phony beholden to the same forces that almost destroyed the country as Republicans are. ..."
Aug 06, 2011 | nytimes.com

When Barack Obama rose to the lectern on Inauguration Day, the nation was in tatters. Americans were scared and angry. The economy was spinning in reverse. Three-quarters of a million people lost their jobs that month. Many had lost their homes, and with them the only nest eggs they had. Even the usually impervious upper middle class had seen a decade of stagnant or declining investment, with the stock market dropping in value with no end in sight. Hope was as scarce as credit.

In that context, Americans needed their president to tell them a story that made sense of what they had just been through, what caused it, and how it was going to end. They needed to hear that he understood what they were feeling, that he would track down those responsible for their pain and suffering, and that he would restore order and safety. What they were waiting for, in broad strokes, was a story something like this:

"I know you're scared and angry. Many of you have lost your jobs, your homes, your hope. This was a disaster, but it was not a natural disaster. It was made by Wall Street gamblers who speculated with your lives and futures. It was made by conservative extremists who told us that if we just eliminated regulations and rewarded greed and recklessness, it would all work out. But it didn't work out. And it didn't work out 80 years ago, when the same people sold our grandparents the same bill of goods, with the same results. But we learned something from our grandparents about how to fix it, and we will draw on their wisdom. We will restore business confidence the old-fashioned way: by putting money back in the pockets of working Americans by putting them back to work, and by restoring integrity to our financial markets and demanding it of those who want to run them. I can't promise that we won't make mistakes along the way. But I can promise you that they will be honest mistakes, and that your government has your back again." A story isn't a policy. But that simple narrative - and the policies that would naturally have flowed from it - would have inoculated against much of what was to come in the intervening two and a half years of failed government, idled factories and idled hands. That story would have made clear that the president understood that the American people had given Democrats the presidency and majorities in both houses of Congress to fix the mess the Republicans and Wall Street had made of the country, and that this would not be a power-sharing arrangement. It would have made clear that the problem wasn't tax-and-spend liberalism or the deficit - a deficit that didn't exist until George W. Bush gave nearly $2 trillion in tax breaks largely to the wealthiest Americans and squandered $1 trillion in two wars.

And perhaps most important, it would have offered a clear, compelling alternative to the dominant narrative of the right, that our problem is not due to spending on things like the pensions of firefighters, but to the fact that those who can afford to buy influence are rewriting the rules so they can cut themselves progressively larger slices of the American pie while paying less of their fair share for it.

But there was no story - and there has been none since.

In similar circumstances, Franklin D. Roosevelt offered Americans a promise to use the power of his office to make their lives better and to keep trying until he got it right. Beginning in his first inaugural address, and in the fireside chats that followed, he explained how the crash had happened, and he minced no words about those who had caused it. He promised to do something no president had done before: to use the resources of the United States to put Americans directly to work, building the infrastructure we still rely on today. He swore to keep the people who had caused the crisis out of the halls of power, and he made good on that promise. In a 1936 speech at Madison Square Garden, he thundered, "Never before in all our history have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me - and I welcome their hatred."

When Barack Obama stepped into the Oval Office, he stepped into a cycle of American history, best exemplified by F.D.R. and his distant cousin, Teddy. After a great technological revolution or a major economic transition, as when America changed from a nation of farmers to an urban industrial one, there is often a period of great concentration of wealth, and with it, a concentration of power in the wealthy. That's what we saw in 1928, and that's what we see today. At some point that power is exercised so injudiciously, and the lives of so many become so unbearable, that a period of reform ensues - and a charismatic reformer emerges to lead that renewal. In that sense, Teddy Roosevelt started the cycle of reform his cousin picked up 30 years later, as he began efforts to bust the trusts and regulate the railroads, exercise federal power over the banks and the nation's food supply, and protect America's land and wildlife, creating the modern environmental movement.

Those were the shoes - that was the historic role - that Americans elected Barack Obama to fill. The president is fond of referring to "the arc of history," paraphrasing the Rev. Dr. Martin Luther King Jr.'s famous statement that "the arc of the moral universe is long, but it bends toward justice." But with his deep-seated aversion to conflict and his profound failure to understand bully dynamics - in which conciliation is always the wrong course of action, because bullies perceive it as weakness and just punch harder the next time - he has broken that arc and has likely bent it backward for at least a generation.

When Dr. King spoke of the great arc bending toward justice, he did not mean that we should wait for it to bend. He exhorted others to put their full weight behind it, and he gave his life speaking with a voice that cut through the blistering force of water cannons and the gnashing teeth of police dogs. He preached the gospel of nonviolence, but he knew that whether a bully hid behind a club or a poll tax, the only effective response was to face the bully down, and to make the bully show his true and repugnant face in public.

IN contrast, when faced with the greatest economic crisis, the greatest levels of economic inequality, and the greatest levels of corporate influence on politics since the Depression, Barack Obama stared into the eyes of history and chose to avert his gaze. Instead of indicting the people whose recklessness wrecked the economy, he put them in charge of it. He never explained that decision to the public - a failure in storytelling as extraordinary as the failure in judgment behind it. Had the president chosen to bend the arc of history, he would have told the public the story of the destruction wrought by the dismantling of the New Deal regulations that had protected them for more than half a century. He would have offered them a counternarrative of how to fix the problem other than the politics of appeasement, one that emphasized creating economic demand and consumer confidence by putting consumers back to work. He would have had to stare down those who had wrecked the economy, and he would have had to tolerate their hatred if not welcome it. But the arc of his temperament just didn't bend that far.

Michael August 7, 2011

Eloquently expressed and horrifically accurate, this excellent analysis articulates the frustration that so many of us have felt watching Mr...

Bill Levine August 7, 2011

Very well put. I know that I have been going through Kübler-Ross's stages of grief ever since the foxes (a.k.a. Geithner and Summers) were...

AnAverageAmerican August 7, 2011

"In that context, Americans needed their president to tell them a story that made sense of what they had just been through, what caused it,...

cdearman Santa Fe, NM August 7, 2011

Unfortunately, the Democratic Congress of 2008-2010, did not have the will to make the economic and social program decisions that would have improved the economic situation for the middle-class; and it is becoming more obvious that President Obama does not have the temperament to publicly push for programs and policies that he wants the congress to enact.
The American people have a problem: we reelect Obama and hope for the best; or we elect a Republican and expect the worst. There is no question that the Health Care law that was just passed would be reversed; Medicare and Medicare would be gutted; and who knows what would happen to Social Security. You can be sure, though, that business taxes and regulation reforms would not be in the cards and those regulations that have been enacted would be reversed. We have traveled this road before and we should be wise enough not to travel it again!

SP California August 7, 2011

Brilliant analysis - and I suspect that a very large number of those who voted for President Obama will recognize in this the thoughts that they have been trying to ignore, or have been trying not to say out loud. Later historians can complete this analysis and attempt to explain exactly why Mr. Obama has turned out the way he has - but right now, it may be time to ask a more relevant and urgent question.

If it is not too late, will a challenger emerge in time before the 2012 elections, or will we be doomed to hold our noses and endure another four years of this?

farospace san francisco August 7, 2011

Very eloquent and exactly to the point. Like many others, I was enthralled by the rhetoric of his story, making the leap of faith (or hope) that because he could tell his story so well, he could tell, as you put it, "the story the American people were waiting to hear."

Disappointment has darkened into disillusion, disillusion into a species of despair. Will I vote for Barack Obama again? What are the options?

Richard Katz American in Oxford, UK August 7, 2011

This is the most brilliant and tragic story I have read in a long time---in fact, precisely since I read when Ill Fares the Land by Tony Judt. When will a leader emerge with a true moral vision for the federal government and for our country? Someone who sees government as a balance to capitalism, and a means to achieve the social and economic justice that we (yes, we) believe in? Will that leadership arrive before parts of America come to look like the dystopia of Johannesburg?

We (yes, we) recognise that capitalism is the most efficient way to maximise overall prosperity and quality of life. But we also recognise that unfettered, it will ravage the environment, abuse labor, and expand income disparity until violence or tragedy (or both) ensues.

These are the lessons we've learned since the industrial revolution, and they're the ones that we should be drawing from the past decade. We recognise that we need a strong federal government to check these tendencies, and to strike a stable, sustainable balance between prosperity, community, opportunity, wealth, justice, freedom. We need a voice to fill the moral vacuum that has allowed the Koch/Tea/Fox Party to emerge and grab power.

Americans know this---including, of course, President Obama (see his April 13 speech at GW University). But as this article by Dr. Westen so effectively shows, Obama is incompetent to lead us back to America's traditional position on the global economic/political spectrum. He's brilliant and eloquent. He's achieved personal success that is inspirational. He's done some good things as president. But he is not competent to lead us back to a state of American morality, where government is the protector of those who work hard, and the provider of opportunity to all Americans.

Taxes, subsidies, entitlements, laws... these are the tools we have available to achieve our national moral vision. But the vision has been muddled (hijacked?) and that is our biggest problem. -->

An Ordinary American Prague August 7, 2011

I voted for Obama. I thought then, and still think, he's a decent person, a smart person, a person who wants to do the best he can for others. When I voted for him, I was thinking he's a centrist who will find a way to unite our increasingly polarized and ugly politics in the USA. Or if not unite us, at least forge a way to get some important things done despite the ugly polarization.

And I must confess, I have been disappointed. Deeply so. He has not united us. He has not forged a way to accomplish what needs to be done. He has not been a leader.

I've heard him called a mediator, a conciliator, a compromiser, etc. Those terms indicate someone who is bringing divergent views together and moving us along. That's part of what a leader does, though not all. Yet I don't think he's even lived up to his reputation as a mediator.

Almost three years after I voted for Obama, I still don't know what he's doing other than trying to help the financial industry: the wealthy who benefit most from it and the technocrats who run it for them. But average working people, people like myself and my daughter and my grandson, have not been helped. We are worse off than before. And millions of unemployed and underemployed are even worse off than my family is.

So whatever else he is (and that still remains a mystery to me), President Obama is not the leader I thought I was voting for. Which leaves me feeling confused and close to apathetic about what to do as a voter in 2012. More of the same isn't worth voting for. Yet I don't see anyone out there who offers the possibility of doing better.

martin Portland, Oregon August 7, 2011

This was an extraordinarily well written, eloquent and comprehensive indictment of the failure of the Obama presidency.

If a credible primary challenger to Obama ever could arise, the positions and analysis in this column would be all he or she would need to justify the Democratic party's need to seek new leadership.

I knew that Obama was a charade early on when giving a speech about the banking failures to the nation, instead of giving the narrative Mr. Westen accurately recommended on the origins of the orgy of greed that just crippled our economy and caused suffering for millions of Americans, he said "we don't disparage wealth in America." I was dumbfounded.

He should have been condemning the craven, wanton, greed of nihilistic financial gangsters who hijacked our economy. Instead he seemed to be calling for all Americans not to hate rich people. That was not the point. Americans don't hate rich people, but they should hate rich people who acquire their wealth at the expense of the well being of an entire nation through irresponsible, avaricious, and in some instances illegal practices, and legally bribe politicians to enact laws which allow them to run amok over our economy without supervision or regulation.

I knew then that Obama was either a political lemon, in over his head, an extremely conflict averse neurotic individual with a compulsive need for some delusional ideal of neutrality in political and social relations, or a political phony beholden to the same forces that almost destroyed the country as Republicans are.

Perhaps all of these are true.

[Dec 31, 2016] What Happened to Obamas Passion

This was written in 2011 but it summarizes Obama presidency pretty nicely, even today. Betrayer in chief, the master of bait and switch. That is the essence of Obama legacy. On "Great Democratic betrayal"... Obama always was a closet neoliberal and neocon. A stooge of neoliberal financial oligarchy, a puppet, if you want politically incorrect term. He just masked it well during hist first election campaigning as a progressive democrat... And he faced Romney in his second campaign, who was even worse, so after betraying American people once, he was reelected and did it twice. Much like Bush II. He like another former cocaine addict -- George W Bush has never any intention of helping American people, only oligarchy.
Notable quotes:
"... IN contrast, when faced with the greatest economic crisis, the greatest levels of economic inequality, and the greatest levels of corporate influence on politics since the Depression, Barack Obama stared into the eyes of history and chose to avert his gaze. ..."
"... We (yes, we) recognise that capitalism is the most efficient way to maximise overall prosperity and quality of life. But we also recognise that unfettered, it will ravage the environment, abuse labor, and expand income disparity until violence or tragedy (or both) ensues. ..."
"... These are the lessons we've learned since the industrial revolution, and they're the ones that we should be drawing from the past decade. We recognise that we need a strong federal government to check these tendencies, and to strike a stable, sustainable balance between prosperity, community, opportunity, wealth, justice, freedom. We need a voice to fill the moral vacuum that has allowed the Koch/Tea/Fox Party to emerge and grab power. ..."
"... Americans know this---including, of course, President Obama (see his April 13 speech at GW University). But as this article by Dr. Westen so effectively shows, Obama is incompetent to lead us back ..."
"... he is not competent to lead us back to a state of American morality, where government is the protector of those who work hard, and the provider of opportunity to all Americans. ..."
"... I've heard him called a mediator, a conciliator, a compromiser, etc. Those terms indicate someone who is bringing divergent views together and moving us along. That's part of what a leader does, though not all. Yet I don't think he's even lived up to his reputation as a mediator. ..."
"... Almost three years after I voted for Obama, I still don't know what he's doing other than trying to help the financial industry: the wealthy who benefit most from it and the technocrats who run it for them. But average working people, people like myself and my daughter and my grandson, have not been helped. We are worse off than before. And millions of unemployed and underemployed are even worse off than my family is. ..."
"... So whatever else he is (and that still remains a mystery to me), President Obama is not the leader I thought I was voting for. ..."
"... I knew that Obama was a charade early on when giving a speech about the banking failures to the nation, instead of giving the narrative Mr. Westen accurately recommended on the origins of the orgy of greed that just crippled our economy and caused suffering for millions of Americans ..."
"... He should have been condemning the craven, wanton, greed of nihilistic financial gangsters who hijacked our economy. Instead he seemed to be calling for all Americans not to hate rich people. That was not the point. Americans don't hate rich people, but they should hate rich people who acquire their wealth at the expense of the well being of an entire nation through irresponsible, avaricious, and in some instances illegal practices, and legally bribe politicians to enact laws which allow them to run amok over our economy without supervision or regulation. ..."
"... I knew then that Obama was either a political lemon, in over his head, an extremely conflict averse neurotic individual with a compulsive need for some delusional ideal of neutrality in political and social relations, or a political phony beholden to the same forces that almost destroyed the country as Republicans are. ..."
Aug 06, 2011 | nytimes.com

When Barack Obama rose to the lectern on Inauguration Day, the nation was in tatters. Americans were scared and angry. The economy was spinning in reverse. Three-quarters of a million people lost their jobs that month. Many had lost their homes, and with them the only nest eggs they had. Even the usually impervious upper middle class had seen a decade of stagnant or declining investment, with the stock market dropping in value with no end in sight. Hope was as scarce as credit.

In that context, Americans needed their president to tell them a story that made sense of what they had just been through, what caused it, and how it was going to end. They needed to hear that he understood what they were feeling, that he would track down those responsible for their pain and suffering, and that he would restore order and safety. What they were waiting for, in broad strokes, was a story something like this:

"I know you're scared and angry. Many of you have lost your jobs, your homes, your hope. This was a disaster, but it was not a natural disaster. It was made by Wall Street gamblers who speculated with your lives and futures. It was made by conservative extremists who told us that if we just eliminated regulations and rewarded greed and recklessness, it would all work out. But it didn't work out. And it didn't work out 80 years ago, when the same people sold our grandparents the same bill of goods, with the same results. But we learned something from our grandparents about how to fix it, and we will draw on their wisdom. We will restore business confidence the old-fashioned way: by putting money back in the pockets of working Americans by putting them back to work, and by restoring integrity to our financial markets and demanding it of those who want to run them. I can't promise that we won't make mistakes along the way. But I can promise you that they will be honest mistakes, and that your government has your back again." A story isn't a policy. But that simple narrative - and the policies that would naturally have flowed from it - would have inoculated against much of what was to come in the intervening two and a half years of failed government, idled factories and idled hands. That story would have made clear that the president understood that the American people had given Democrats the presidency and majorities in both houses of Congress to fix the mess the Republicans and Wall Street had made of the country, and that this would not be a power-sharing arrangement. It would have made clear that the problem wasn't tax-and-spend liberalism or the deficit - a deficit that didn't exist until George W. Bush gave nearly $2 trillion in tax breaks largely to the wealthiest Americans and squandered $1 trillion in two wars.

And perhaps most important, it would have offered a clear, compelling alternative to the dominant narrative of the right, that our problem is not due to spending on things like the pensions of firefighters, but to the fact that those who can afford to buy influence are rewriting the rules so they can cut themselves progressively larger slices of the American pie while paying less of their fair share for it.

But there was no story - and there has been none since.

In similar circumstances, Franklin D. Roosevelt offered Americans a promise to use the power of his office to make their lives better and to keep trying until he got it right. Beginning in his first inaugural address, and in the fireside chats that followed, he explained how the crash had happened, and he minced no words about those who had caused it. He promised to do something no president had done before: to use the resources of the United States to put Americans directly to work, building the infrastructure we still rely on today. He swore to keep the people who had caused the crisis out of the halls of power, and he made good on that promise. In a 1936 speech at Madison Square Garden, he thundered, "Never before in all our history have these forces been so united against one candidate as they stand today. They are unanimous in their hate for me - and I welcome their hatred."

When Barack Obama stepped into the Oval Office, he stepped into a cycle of American history, best exemplified by F.D.R. and his distant cousin, Teddy. After a great technological revolution or a major economic transition, as when America changed from a nation of farmers to an urban industrial one, there is often a period of great concentration of wealth, and with it, a concentration of power in the wealthy. That's what we saw in 1928, and that's what we see today. At some point that power is exercised so injudiciously, and the lives of so many become so unbearable, that a period of reform ensues - and a charismatic reformer emerges to lead that renewal. In that sense, Teddy Roosevelt started the cycle of reform his cousin picked up 30 years later, as he began efforts to bust the trusts and regulate the railroads, exercise federal power over the banks and the nation's food supply, and protect America's land and wildlife, creating the modern environmental movement.

Those were the shoes - that was the historic role - that Americans elected Barack Obama to fill. The president is fond of referring to "the arc of history," paraphrasing the Rev. Dr. Martin Luther King Jr.'s famous statement that "the arc of the moral universe is long, but it bends toward justice." But with his deep-seated aversion to conflict and his profound failure to understand bully dynamics - in which conciliation is always the wrong course of action, because bullies perceive it as weakness and just punch harder the next time - he has broken that arc and has likely bent it backward for at least a generation.

When Dr. King spoke of the great arc bending toward justice, he did not mean that we should wait for it to bend. He exhorted others to put their full weight behind it, and he gave his life speaking with a voice that cut through the blistering force of water cannons and the gnashing teeth of police dogs. He preached the gospel of nonviolence, but he knew that whether a bully hid behind a club or a poll tax, the only effective response was to face the bully down, and to make the bully show his true and repugnant face in public.

IN contrast, when faced with the greatest economic crisis, the greatest levels of economic inequality, and the greatest levels of corporate influence on politics since the Depression, Barack Obama stared into the eyes of history and chose to avert his gaze. Instead of indicting the people whose recklessness wrecked the economy, he put them in charge of it. He never explained that decision to the public - a failure in storytelling as extraordinary as the failure in judgment behind it. Had the president chosen to bend the arc of history, he would have told the public the story of the destruction wrought by the dismantling of the New Deal regulations that had protected them for more than half a century. He would have offered them a counternarrative of how to fix the problem other than the politics of appeasement, one that emphasized creating economic demand and consumer confidence by putting consumers back to work. He would have had to stare down those who had wrecked the economy, and he would have had to tolerate their hatred if not welcome it. But the arc of his temperament just didn't bend that far.

Michael August 7, 2011

Eloquently expressed and horrifically accurate, this excellent analysis articulates the frustration that so many of us have felt watching Mr...

Bill Levine August 7, 2011

Very well put. I know that I have been going through Kübler-Ross's stages of grief ever since the foxes (a.k.a. Geithner and Summers) were...

AnAverageAmerican August 7, 2011

"In that context, Americans needed their president to tell them a story that made sense of what they had just been through, what caused it,...

cdearman Santa Fe, NM August 7, 2011

Unfortunately, the Democratic Congress of 2008-2010, did not have the will to make the economic and social program decisions that would have improved the economic situation for the middle-class; and it is becoming more obvious that President Obama does not have the temperament to publicly push for programs and policies that he wants the congress to enact.
The American people have a problem: we reelect Obama and hope for the best; or we elect a Republican and expect the worst. There is no question that the Health Care law that was just passed would be reversed; Medicare and Medicare would be gutted; and who knows what would happen to Social Security. You can be sure, though, that business taxes and regulation reforms would not be in the cards and those regulations that have been enacted would be reversed. We have traveled this road before and we should be wise enough not to travel it again!

SP California August 7, 2011

Brilliant analysis - and I suspect that a very large number of those who voted for President Obama will recognize in this the thoughts that they have been trying to ignore, or have been trying not to say out loud. Later historians can complete this analysis and attempt to explain exactly why Mr. Obama has turned out the way he has - but right now, it may be time to ask a more relevant and urgent question.

If it is not too late, will a challenger emerge in time before the 2012 elections, or will we be doomed to hold our noses and endure another four years of this?

farospace san francisco August 7, 2011

Very eloquent and exactly to the point. Like many others, I was enthralled by the rhetoric of his story, making the leap of faith (or hope) that because he could tell his story so well, he could tell, as you put it, "the story the American people were waiting to hear."

Disappointment has darkened into disillusion, disillusion into a species of despair. Will I vote for Barack Obama again? What are the options?

Richard Katz American in Oxford, UK August 7, 2011

This is the most brilliant and tragic story I have read in a long time---in fact, precisely since I read when Ill Fares the Land by Tony Judt. When will a leader emerge with a true moral vision for the federal government and for our country? Someone who sees government as a balance to capitalism, and a means to achieve the social and economic justice that we (yes, we) believe in? Will that leadership arrive before parts of America come to look like the dystopia of Johannesburg?

We (yes, we) recognise that capitalism is the most efficient way to maximise overall prosperity and quality of life. But we also recognise that unfettered, it will ravage the environment, abuse labor, and expand income disparity until violence or tragedy (or both) ensues.

These are the lessons we've learned since the industrial revolution, and they're the ones that we should be drawing from the past decade. We recognise that we need a strong federal government to check these tendencies, and to strike a stable, sustainable balance between prosperity, community, opportunity, wealth, justice, freedom. We need a voice to fill the moral vacuum that has allowed the Koch/Tea/Fox Party to emerge and grab power.

Americans know this---including, of course, President Obama (see his April 13 speech at GW University). But as this article by Dr. Westen so effectively shows, Obama is incompetent to lead us back to America's traditional position on the global economic/political spectrum. He's brilliant and eloquent. He's achieved personal success that is inspirational. He's done some good things as president. But he is not competent to lead us back to a state of American morality, where government is the protector of those who work hard, and the provider of opportunity to all Americans.

Taxes, subsidies, entitlements, laws... these are the tools we have available to achieve our national moral vision. But the vision has been muddled (hijacked?) and that is our biggest problem. -->

An Ordinary American Prague August 7, 2011

I voted for Obama. I thought then, and still think, he's a decent person, a smart person, a person who wants to do the best he can for others. When I voted for him, I was thinking he's a centrist who will find a way to unite our increasingly polarized and ugly politics in the USA. Or if not unite us, at least forge a way to get some important things done despite the ugly polarization.

And I must confess, I have been disappointed. Deeply so. He has not united us. He has not forged a way to accomplish what needs to be done. He has not been a leader.

I've heard him called a mediator, a conciliator, a compromiser, etc. Those terms indicate someone who is bringing divergent views together and moving us along. That's part of what a leader does, though not all. Yet I don't think he's even lived up to his reputation as a mediator.

Almost three years after I voted for Obama, I still don't know what he's doing other than trying to help the financial industry: the wealthy who benefit most from it and the technocrats who run it for them. But average working people, people like myself and my daughter and my grandson, have not been helped. We are worse off than before. And millions of unemployed and underemployed are even worse off than my family is.

So whatever else he is (and that still remains a mystery to me), President Obama is not the leader I thought I was voting for. Which leaves me feeling confused and close to apathetic about what to do as a voter in 2012. More of the same isn't worth voting for. Yet I don't see anyone out there who offers the possibility of doing better.

martin Portland, Oregon August 7, 2011

This was an extraordinarily well written, eloquent and comprehensive indictment of the failure of the Obama presidency.

If a credible primary challenger to Obama ever could arise, the positions and analysis in this column would be all he or she would need to justify the Democratic party's need to seek new leadership.

I knew that Obama was a charade early on when giving a speech about the banking failures to the nation, instead of giving the narrative Mr. Westen accurately recommended on the origins of the orgy of greed that just crippled our economy and caused suffering for millions of Americans, he said "we don't disparage wealth in America." I was dumbfounded.

He should have been condemning the craven, wanton, greed of nihilistic financial gangsters who hijacked our economy. Instead he seemed to be calling for all Americans not to hate rich people. That was not the point. Americans don't hate rich people, but they should hate rich people who acquire their wealth at the expense of the well being of an entire nation through irresponsible, avaricious, and in some instances illegal practices, and legally bribe politicians to enact laws which allow them to run amok over our economy without supervision or regulation.

I knew then that Obama was either a political lemon, in over his head, an extremely conflict averse neurotic individual with a compulsive need for some delusional ideal of neutrality in political and social relations, or a political phony beholden to the same forces that almost destroyed the country as Republicans are.

Perhaps all of these are true.

[Dec 27, 2016] Class Struggle In The USA

Notable quotes:
"... Rich individuals (who are willing to be interviewed) also express concern about inequality but generally oppose using higher taxes on the rich to fight it. Scheiber is very willing to bluntly state his guess (and everyone's) that candidates are eager to please the rich, because they spend much of their time begging the rich for contributions. ..."
"... Of course another way to reduce inequality is to raise wages. Buried way down around paragraph 9 I found this gem: "Forty percent of the wealthy, versus 78 percent of the public, said the government should make the minimum wage "high enough so that no family with a full-time worker falls below the official poverty line." ..."
"... The current foundational rules embedded in tax law, intellectual property law, corporate construction law, and other elements of our legal and regulatory system result in distributions that favor those with capital or in a position to seek rents. This isn't a situation that calls for a Robin Hood who takes from the rich and gives to the poor. It is more a question of how elites have rigged the system to work primarily for them. ..."
"... the problem is incomes and demand, and the first and best answer for creating demand for workers and higher wages to compete for those workers is full employment. ..."
"... if you are proposing raising taxes on the rich SO THAT you can cut taxes on the non rich you are simply proposing theft. ..."
"... what we are looking at here is simple old fashioned greed just as stupid and ugly among the "non rich" as it is among the rich. ..."
"... you play into the hands of the Petersons who want to "cut taxes" and leave the poor elderly to die on the streets, and the poor non-elderly to spend their lives in anxiety and fear-driven greed trying to provide against desperate poverty in old age absent any reliable security for their savings.) ..."
"... made by the ayn rand faithful. it is wearisome. ..."
"... The only cure for organized greed is organized labor. ..."
"... A typical voice of American politics is the avoidance of saying anything real on real issues" ..."
Mar 29, 2015 | Angry Bear

Noam Scheiber has a hard hitting article on the front page of www.nytimes.com "2016 Candidates and Wealthy Are Aligned on Inequality"

The content should be familiar to AngryBear readers. A majority of Americans are alarmed by high and increasing inequality and support government action to reduce inequality. However, none of the important 2016 candidates has expressed any willingness to raise taxes on the rich. The Republicans want to cut them and Clinton (and a spokesperson) dodge the question.

Rich individuals (who are willing to be interviewed) also express concern about inequality but generally oppose using higher taxes on the rich to fight it. Scheiber is very willing to bluntly state his guess (and everyone's) that candidates are eager to please the rich, because they spend much of their time begging the rich for contributions.

No suprise to anyone who has been paying attention except for the fact that it is on the front page of www.nytimes.com and the article is printed in the business section not the opinion section. Do click the link - it is brief, to the point, solid, alarming and a must read.

I clicked one of the links and found weaker evidence than I expected for Scheiber's view (which of course I share

"By contrast, more than half of Americans and three-quarters of Democrats believe the "government should redistribute wealth by heavy taxes on the rich," according to a Gallup poll of about 1,000 adults in April 2013."

It is a small majority 52% favor and 47% oppose. This 52 % is noticeably smaller than the solid majorities who have been telling Gallup that high income individuals pay less than their fair share of taxes (click and search for Gallup on the page).

I guess this isn't really surprising - the word "heavy" is heavy maaaan and "redistribute" evokes the dreaded welfare (and conservatives have devoted gigantic effort to giving it pejorative connotations). The 52% majority is remarkable given the phrasing of the question. But it isn't enough to win elections, since it is 52% of adults which corresponds to well under 52% of actual voters.

My reading is that it is important for egalitarians to stress the tax cuts for the non rich and that higher taxes on the rich are, unfortunately, necessary if we are to have lower taxes on the non rich without huge budget deficits. This is exactly Obama's approach.

Comments (87)

Jerry Critter

March 29, 2015 10:40 pm

Get rid of tax breaks that only the wealthy can take advantage of and perhaps everyone will pay their fair share. The same goes for corporations.

amateur socialist

March 30, 2015 11:42 am

Of course another way to reduce inequality is to raise wages. Buried way down around paragraph 9 I found this gem: "Forty percent of the wealthy, versus 78 percent of the public, said the government should make the minimum wage "high enough so that no family with a full-time worker falls below the official poverty line."

I'm fine with raising people's taxes by increasing their wages. A story I heard on NPR recently indicated that a single person needs to make about $17-19 an hour to cover most basic necessities nowadays (the story went on to say that most people in that situation are working 2 or more jobs to get enough income, a "solution" that creates more problems with health/stress etc.). A full time worker supporting kids needs more than $20.

You double the minimum wage and strengthen people's rights to organize union representation. Tax revenues go up (including SS contributions btw) and we add significant growth to the economy with the increased purchasing power of workers. People can go back to working 40-50 hours a week and cut back on moonlighting which creates new job opportunities for the younger folks decimated by this so called recovery.

Win Win Win Win. And the poor overburdened millionaires don't have to have their poor tax fee fees hurt.

Mark Jamison, March 30, 2015 8:09 pm

How about if we get rid of the "re" and call it what it is "distribution". The current foundational rules embedded in tax law, intellectual property law, corporate construction law, and other elements of our legal and regulatory system result in distributions that favor those with capital or in a position to seek rents.

This isn't a situation that calls for a Robin Hood who takes from the rich and gives to the poor. It is more a question of how elites have rigged the system to work primarily for them. Democrats cede the rhetoric to the Right when they allow the discussion to be about redistribution. Even talk of inequality without reference to the basic legal constructs that are rigged to create slanted outcomes tend to accepted premises that are in and of themselves false.

The issue shouldn't be rejiggering things after the the initial distribution but creating a system with basic rules that level the opportunity playing field.

coberly, March 30, 2015 11:03 pm

Thank You Mark Jamison!

An elegant, informed writer who says it better than I can.

But here is how I would say it:

Addressing "inequality" by "tax the rich" is the wrong answer and a political loser.

Address inequality by re-criminalizing the criminal practices of the criminal rich. Address inequality by creating well paying jobs with government jobs if necessary (and there is necessary work to be done by the government), with government protection for unions, with government policies that make it less profitable to off shore

etc. the direction to take is to make the economy more fair . actually more "free" though you'll never get the free enterprise fundamentalists to admit that's what it is. You WILL get the honest rich on your side. They don't like being robbed any more than you do.

But you will not, in America, get even poor people to vote to "take from the rich to give to the poor." It has something to do with the "story" Americans have been telling themselves since 1776. A story heard round the world.

That said, there is nothing wrong with raising taxes on the rich to pay for the government THEY need as well as you. But don't raise taxes to give the money to the poor. They won't do it, and even the poor don't want it except as a last resort, which we hope we are not at yet.

urban legend, March 31, 2015 2:07 am

Coberly, you are dead-on. Right now, taxation is the least issue. Listen to Jared Bernstein and Dean Baker: the problem is incomes and demand, and the first and best answer for creating demand for workers and higher wages to compete for those workers is full employment. Minimum wage will help at the margins to push incomes up, and it's the easiest initial legislative sell, but the public will support policies - mainly big-big infrastructure modernization in a country that has neglected its infrastructure for a generation - that signal a firm commitment to full employment.

It's laying right there for the Democrats to pick it up. Will they? Having policies that are traditional Democratic policies will not do the job. For believability - for convincing voters they actually have a handle on what has been wrong and how to fix it - they need to have a story for why we have seem unable to generate enough jobs for over a decade. The neglect of infrastructure - the unfilled millions of jobs that should have gone to keeping it up to date and up to major-country standards - should be a big part of that story. Trade and manufacturing, to be sure, is the other big element that will connect with voters. Many Democrats (including you know who) are severely compromised on trade, but they need to find a way to come own on the right side with the voters.

coberly, March 31, 2015 10:52 am

Robert

i wish you'd give some thought to the other comments on this post.

if you are proposing raising taxes on the rich SO THAT you can cut taxes on the non rich you are simply proposing theft. if you were proposing raising taxes on the rich to provide reasonable welfare to those who need it you would be asking the rich to contribute to the strength of their own country and ultimately their own wealth.

i hope you can see the difference.

it is especially irritating to me because many of the "non rich" who want their taxes cut make more than twice as much as i do. what we are looking at here is simple old fashioned greed just as stupid and ugly among the "non rich" as it is among the rich.

"the poor" in this country do not pay a significant amount of taxes (Social Security and Medicare are not "taxes," merely an efficient way for us to pay for our own direct needs . as long as you call them taxes you play into the hands of the Petersons who want to "cut taxes" and leave the poor elderly to die on the streets, and the poor non-elderly to spend their lives in anxiety and fear-driven greed trying to provide against desperate poverty in old age absent any reliable security for their savings.)

Kai-HK, April 4, 2015 12:23 am

coberly,

Thanks for your well-reasoned response.

You state, 'i personally am not much interested in the "poor capitalist will flee the country if you tax him too much." in fact i'd say good riddance, and by the way watch out for that tarriff when you try to sell your stuff here.'

(a) What happens after thy leave? Sure you can get one-time 'exit tax' but you lose all the intellectual capital (think of Bill Gates, Warren Buffet, or Steve Jobs leaving and taking their intellectual property and human capital with them). These guys are great jobs creators it will not only be the 'bad capitalists' that leave but also many of the 'job creating' good ones.

(b) I am less worried about existing job creating capitalists in America; what about the future ones? The ones that either flee overseas and make their wealth there or are already overseas and then have a plethora of places they can invest but why bother investing in the US if all they are going to do is call me a predator and then seize my assets and or penalise me for investing there? Right? It is the future investment that gets impacted not current wealth per se.

You also make a great point, 'the poor are in the worst position with respect to shifting their tax burden on to others. the rich do it as a matter of course. it would be simpler just to tax the rich there are fewer of them, and they know what is at stake, and they can afford accountants. the rest of us would pay our "taxes" in the form of higher prices for what we buy.'

Investment capital will go where it is best treated and to attract investment capital a market must provide a competitive return (profit margin or return on investment). Those companies and investment that stay will do so because they are able to maintain that margin .and they will do so by either reducing wages or increasing prices. Where they can do neither, their will exit the market.

That is why, according to research, a bulk of the corporate taxation falls on workers and consumers as a pass-on effect. The optimum corporate tax is 0. This will be the case as taxation increases on the owners of businesses and capital .workers, the middle class, and the poor pay it. The margins stay competitive for the owners of capital since capital is highly mobile and fungible.Workers and the poor less so.

But thanks again for the tone and content of your response. I often get attacked personally for my views instead of people focusing on the issue. I appreciate the respite.

K

coberly, April 4, 2015 12:34 pm

kai

yes, but you missed the point.

i am sick of the whining about taxes. it takes so much money to run the country (including the kind of pernicious poverty that will turn the US into sub-saharan africa. and then who will buy their products.

i can't do much about the poor whining about taxes. they are just people with limited understanding, except for their own pressing needs. the rich know what the taxes are needed for, they are just stupid about paying them. of course they would pass the taxes through to their customers. the customers would still buy what they need/want at the new price. leaving everyone pretty much where they are today financially. but the rich would be forced to be grownup about "paying" the taxes, and maybe the politics of "don't tax me tax the other guy" would go away.

as for the sainted bill gates. there are plenty of other people in this country as smart as he is and would be happy to sell us computer operating systems and pay the taxes on their billion dollars a year profits.

nothing breaks my heart more than a whining millionaire.

Kai-HK

April 4, 2015 11:32 pm

Sure I got YOUR point, it just didn't address MY points as put forth in MY original post. And it still doesn't.

More importantly, you have failed to defend YOUR point against even a rudimentary challenge.

K

coberly, April 5, 2015 12:45 pm

kai,

rudimentary is right.

i have read your "points" about sixteen hundred times in the last year alone. made by the ayn rand faithful. it is wearisome.

and i have learned there is no point in trying to talk to true believers.

William Ryan, May 13, 2015 4:43 pm

Thanks again Coberly for your and K's very thoughtful insight. You guys really made me think hard today and I do see your points about perverted capitalism being a big problem in US. I still do like the progressive tax structure and balanced trade agenda better.

I realize as you say that we cannot compare US to Hong Kong just on size and scale alone. Without all the obfuscation going Lean by building cultures that makes people want to take ownership and sharing learning and growing together is a big part of the solution Ford once said "you cannot learn in school what the world is going to do next".

Also never argue with an idiot. They will bring you down to their level then beat you with experience. The only cure for organized greed is organized labor. It's because no matter what they do nothing get done about it. With all this manure around there must be a pony somewhere! "

  • A typical voice of American politics is the avoidance of saying anything real on real issues". FDR.
  • Rich people pay rich people to tell middle class people to blame poor people
  • Earth doesn't matter, people don't matter, even economy doesn't matter . The only thing that matters is R.W. nut bar total ownership of everything.
  • I'm sorry I put profits ahead of people, greed above need and the rule of gold above God's golden rules.
  • I try to stay away from negative people who have a problem for every solution
  • We need capitalism that is based on justice and greater corporate responsibility. I do not speak nor do I comprehend assholian.
  • "If you don't change direction , you may end up where you are headed". Lao-Tzu.
  • "The true strength of our nation comes not from our arm or wealth but from our ideas". Obama..

Last one.

  • "If the soul is left to darkness, sins will be committed. The guilty one is not the one who commits the sins, but the one who caused the darkness". Victor Hugo.

coberly , May 16, 2015 9:57 pm

kai

as a matter of fact i disagree with the current "equality" fad at least insofar as it implies taking from the rich and giving to the poor directly.

i don't believe people are "equal" in terms of their economic potential. i do beleive they are equal in terms of being due the respect of human beings.

i also believe your simple view of "equality" is a closet way of guarantee that the rich can prey upon the poor without interruption.

humans made their first big step in evolution when they learned to cooperate with each other against the big predators.

Jerry Critter, May 17, 2015 12:10 am

it is mildly progressive up to about $75,000 per year where the rate hits 30%. But from there up to $1.542 million the rate only increases to 33.3%.

I call that very flat!

Jerry Critter, May 17, 2015 11:20 am

"i assume there are people in this country who are truly poor. as far as i know they don't pay taxes."

Read my reference and you will see that the "poor" indeed pay taxes, just not much income tax because they don't have much income. You are fixated on income when we should be considering all forms of taxation.

Jerry Critter, May 17, 2015 9:25 pm

Oh Kai, cut the crap. Paying taxes Is nothing like slavery. My oh my, how did we ever survive with a top tax rate of around 90%, nearly 3 times the current rate? Some people would even say that the economy then was pretty great and the middle class was doing terrific. So stop the deflection and redirection. I think you just like to see how many words you can write. Sorry, but history is not on your side.

[Dec 26, 2016] The Democratic Party as a Party (Sanders was an outlier) has nothing to do with fair and equal play for all. This is a party of soft neoliberals and it adheres to Washington

Notable quotes:
"... The Democratic Party as a Party (Sanders was an outlier) has nothing to do with "fair and equal play for all". This is a party of soft neoliberals and it adheres to Washington consensus no less then Republicans. https://en.wikipedia.org/wiki/Washington_Consensus ..."
"... If you read the key postulates it is clear that that they essentially behaved like an occupier in this country. In this sense "Occupy Wall street" movement should actually be called "Liberation from Wall Street occupation" movement. ..."
"... Bill Clinton realized that he can betray working class with impunity as "they have nowhere to go" and will vote for Democrat anyway. In this sense Bill Clinton is a godfather of the right wing nationalism in the USA. He sowed the "Teeth's of Dragon" and now we have, what we have. ..."
Dec 26, 2016 | economistsview.typepad.com
EMichael : December 26, 2016 at 12:47 PM , 2016 at 12:47 PM
You guys should wake up and smell what country you live in. Here is a good place to start.

"Campaigning for president in 1980, Ronald Reagan told stories of Cadillac-driving "welfare queens" and "strapping young bucks" buying T-bone steaks with food stamps. In trumpeting these tales of welfare run amok, Reagan never needed to mention race, because he was blowing a dog whistle: sending a message about racial minorities inaudible on one level, but clearly heard on another. In doing so, he tapped into a long political tradition that started with George Wallace and Richard Nixon, and is more relevant than ever in the age of the Tea Party and the first black president.

In Dog Whistle Politics, Ian Haney L?pez offers a sweeping account of how politicians and plutocrats deploy veiled racial appeals to persuade white voters to support policies that favor the extremely rich yet threaten their own interests. Dog whistle appeals generate middle-class enthusiasm for political candidates who promise to crack down on crime, curb undocumented immigration, and protect the heartland against Islamic infiltration, but ultimately vote to slash taxes for the rich, give corporations regulatory control over industry and financial markets, and aggressively curtail social services. White voters, convinced by powerful interests that minorities are their true enemies, fail to see the connection between the political agendas they support and the surging wealth inequality that takes an increasing toll on their lives. The tactic continues at full force, with the Republican Party using racial provocations to drum up enthusiasm for weakening unions and public pensions, defunding public schools, and opposing health care reform.

Rejecting any simple story of malevolent and obvious racism, Haney L?pez links as never before the two central themes that dominate American politics today: the decline of the middle class and the Republican Party's increasing reliance on white voters. Dog Whistle Politics will generate a lively and much-needed debate about how racial politics has destabilized the American middle class -- white and nonwhite members alike."

https://www.amazon.com/Dog-Whistle-Politics-Appeals-Reinvented-ebook/dp/B00GHJNSMU

im1dc : , December 26, 2016 at 01:51 PM
Reading the above posts I am reminded that in November there was ONE Election with TWO Results:

Electoral Vote for Donald Trump by the margin of 3 formerly Democratic Voting states Michigan, Ohio, and Pennsylvania

Popular Vote for Hillary Clinton by over 2.8 Million

The Democratic Party and its Candidates OBVIOUSLY need to get more votes in the Electoral States that they lost in 2016, not change what they stand for, the principles of fair and equal play for all.

And, in the 3 States that turned the Electoral Vote in Trump's favor and against Hillary, all that is needed are 125,000 or more votes, probably fewer, and the DEMS win the Electoral vote big too.

It is not any more complex than that.

So how does the Democratic Party get more votes in those States?

PANDER to their voters by delivering on KISS, not talking about it.

That is create living wage jobs and not taking them away as the Republican Party of 'Free Trade' and the Clinton Democratic Party 'Free Trade' Elites did.

Understand this: It is not the responsibility of the USA, or in its best interests, to create jobs in other nations (Mexico, Japan, China, Canada, Israel, etc.) that do not create jobs in the USA equivalently, especially if the gain is offset by costly overseas confrontations and involvements that would not otherwise exist.

likbez : December 26, 2016 at 02:49 PM , 2016 at 02:49 PM
You are dreaming:

"The Democratic Party and its Candidates OBVIOUSLY need to get more votes in the Electoral States that they lost in 2016, not change what they stand for, the principles of fair and equal play for all. "

The Democratic Party as a Party (Sanders was an outlier) has nothing to do with "fair and equal play for all". This is a party of soft neoliberals and it adheres to Washington consensus no less then Republicans. https://en.wikipedia.org/wiki/Washington_Consensus

If you read the key postulates it is clear that that they essentially behaved like an occupier in this country. In this sense "Occupy Wall street" movement should actually be called "Liberation from Wall Street occupation" movement.

Bill Clinton realized that he can betray working class with impunity as "they have nowhere to go" and will vote for Democrat anyway. In this sense Bill Clinton is a godfather of the right wing nationalism in the USA. He sowed the "Teeth's of Dragon" and now we have, what we have.

[Dec 05, 2016] The Democratic Party Presidential Platform of 1996 – On Immigration

Blast from the past. Bill Clinton position on illegal immegtation.
Notable quotes:
"... Today's Democratic Party also believes we must remain a nation of laws. We cannot tolerate illegal immigration and we must stop it. For years before Bill Clinton became President, Washington talked tough but failed to act. In 1992, our borders might as well not have existed. The border was under-patrolled, and what patrols there were, were under-equipped. Drugs flowed freely. Illegal immigration was rampant. Criminal immigrants, deported after committing crimes in America, returned the very next day to commit crimes again. ..."
"... President Clinton is making our border a place where the law is respected and drugs and illegal immigrants are turned away. We have increased the Border Patrol by over 40 percent; in El Paso, our Border Patrol agents are so close together they can see each other. Last year alone, the Clinton Administration removed thousands of illegal workers from jobs across the country. Just since January of 1995, we have arrested more than 1,700 criminal aliens and prosecuted them on federal felony charges because they returned to America after having been deported. ..."
"... However, as we work to stop illegal immigration, we call on all Americans to avoid the temptation to use this issue to divide people from each other. We deplore those who use the need to stop illegal immigration as a pretext for discrimination . And we applaud the wisdom of Republicans like Mayor Giuliani and Senator Domenici who oppose the mean-spirited and short-sighted effort of Republicans in Congress to bar the children of illegal immigrants from schools - it is wrong, and forcing children onto the streets is an invitation for them to join gangs and turn to crime. ..."
Nov 30, 2016 | angrybearblog.com

What follows is from Today's Democratic Party: Meeting America's Challenges, Protecting America's Values , a.k.a., the 1996 Democratic Party Platform. This is the section on immigration. I took the liberty of bolding pieces I found interesting.

Democrats remember that we are a nation of immigrants. We recognize the extraordinary contribution of immigrants to America throughout our history. We welcome legal immigrants to America. We support a legal immigration policy that is pro-family, pro-work, pro-responsibility, and pro-citizenship , and we deplore those who blame immigrants for economic and social problems.

We know that citizenship is the cornerstone of full participation in American life. We are proud that the President launched Citizenship USA to help eligible immigrants become United States citizens. The Immigration and Naturalization Service is streamlining procedures, cutting red tape, and using new technology to make it easier for legal immigrants to accept the responsibilities of citizenship and truly call America their home.

Today's Democratic Party also believes we must remain a nation of laws. We cannot tolerate illegal immigration and we must stop it. For years before Bill Clinton became President, Washington talked tough but failed to act. In 1992, our borders might as well not have existed. The border was under-patrolled, and what patrols there were, were under-equipped. Drugs flowed freely. Illegal immigration was rampant. Criminal immigrants, deported after committing crimes in America, returned the very next day to commit crimes again.

President Clinton is making our border a place where the law is respected and drugs and illegal immigrants are turned away. We have increased the Border Patrol by over 40 percent; in El Paso, our Border Patrol agents are so close together they can see each other. Last year alone, the Clinton Administration removed thousands of illegal workers from jobs across the country. Just since January of 1995, we have arrested more than 1,700 criminal aliens and prosecuted them on federal felony charges because they returned to America after having been deported.

However, as we work to stop illegal immigration, we call on all Americans to avoid the temptation to use this issue to divide people from each other. We deplore those who use the need to stop illegal immigration as a pretext for discrimination . And we applaud the wisdom of Republicans like Mayor Giuliani and Senator Domenici who oppose the mean-spirited and short-sighted effort of Republicans in Congress to bar the children of illegal immigrants from schools - it is wrong, and forcing children onto the streets is an invitation for them to join gangs and turn to crime.

Democrats want to protect American jobs by increasing criminal and civil sanctions against employers who hire illegal workers , but Republicans continue to favor inflammatory rhetoric over real action. We will continue to enforce labor standards to protect workers in vulnerable industries. We continue to firmly oppose welfare benefits for illegal immigrants. We believe family members who sponsor immigrants into this country should take financial responsibility for them, and be held legally responsible for supporting them.

[Nov 18, 2016] The statecraft of neoliberalism: the elimination of political agency and responsibility for economic performance and outcomes by Bruce Wilder

Notable quotes:
"... The New Deal did not seek to overthrow the plutocracy, but it did seek to side-step and disable their dominance. ..."
"... It seems to me that while neoliberalism on the right was much the same old same old, the neoliberal turn on the left was marked by a measured abandonment of this struggle over the distribution of income between the classes. In the U.S., the Democrats gradually abandoned their populist commitments. In Europe, the labour and socialist parties gradually abandoned class struggle. ..."
"... When Obama came in, in 2008 amid the unfolding GFC, one of the most remarkable features of his economic team was the extent to which it conceded control of policy entirely to the leading money center banks. Geithner and Bernanke continued in power with Geithner moving from the New York Federal Reserve (where he served as I recall under a Chair from Goldman Sachs) to Treasury in the Obama Administration, but Geithner's Treasury was staffed from Goldman Sachs, JP Morgan Chase and Citibank. The crisis served to concentrate banking assets in the hands of the top five banks, but it seemed also to transfer political power entirely into their hands as well. Simon Johnson called it a coup. ..."
"... Here's the thing: the globalization and financialization of the economy from roughly 1980 drove both increasingly extreme distribution of income and de-industrialization. ..."
"... It was characteristic of neoliberalism that the policy, policy intention and policy consequences were hidden behind a rhetoric of markets and technological inevitability. Matt Stoller has identified this as the statecraft of neoliberalism: the elimination of political agency and responsibility for economic performance and outcomes. Globalization and financialization were just "forces" that just happened, in a meteorological economics. ..."
"... This was not your grandfather's Democratic Party and it was a Democratic Party that could aid the working class and the Rust Belt only within fairly severe and sometimes sharply conflicting constraints. ..."
"... No one in the Democratic Party had much institutional incentive to connect the dots, and draw attention to the acute conflicts over the distribution of income and wealth involved in financialization of the economy (including financialization as a driver of health care costs). And, that makes the political problem that much harder, because there are no resources for rhetorical and informational clarity or coherence. ..."
"... If Obama could not get a very big stimulus indeed thru a Democratic Congress long out of power, Obama wasn't really trying. And, well-chosen spending on pork barrel projects is popular and gets Congressional critters re-elected. So, again, if the stimulus is small and the Democratic Congress doesn't get re-elected, Obama isn't really trying. ..."
"... Again, it comes down to: by 2008, the Democratic Party is not a fit vehicle for populism, because it has become a neoliberal vehicle for giant banks. Turns out that makes a policy difference. ..."
Nov 18, 2016 | crookedtimber.org

bruce wilder 11.16.16 at 10:07 pm 30

At the center of Great Depression politics was a political struggle over the distribution of income, a struggle that was only decisively resolved during the War, by the Great Compression. It was at center of farm policy where policymakers struggled to find ways to support farm incomes. It was at the center of industrial relations politics, where rapidly expanding unions were seeking higher industrial wages. It was at the center of banking policy, where predatory financial practices were under attack. It was at the center of efforts to regulate electric utility rates and establish public power projects. And, everywhere, the clear subtext was a struggle between rich and poor, the economic royalists as FDR once called them and everyone else.

FDR, an unmistakeable patrician in manner and pedigree, was leading a not-quite-revolutionary politics, which was nevertheless hostile to and suspicious of business elites, as a source of economic pathology. The New Deal did not seek to overthrow the plutocracy, but it did seek to side-step and disable their dominance.

It seems to me that while neoliberalism on the right was much the same old same old, the neoliberal turn on the left was marked by a measured abandonment of this struggle over the distribution of income between the classes. In the U.S., the Democrats gradually abandoned their populist commitments. In Europe, the labour and socialist parties gradually abandoned class struggle.

In retrospect, though the New Deal did use direct employment as a means of relief to good effect economically and politically, it never undertook anything like a Keynesian stimulus on a Keynesian scale - at least until the War.

Where the New Deal witnessed the institution of an elaborate system of financial repression, accomplished in large part by imposing on the financial sector an explicitly mandated structure, with types of firms and effective limits on firm size and scope, a series of regulatory reforms and financial crises beginning with Carter and Reagan served to wipe this structure away.

When Obama came in, in 2008 amid the unfolding GFC, one of the most remarkable features of his economic team was the extent to which it conceded control of policy entirely to the leading money center banks. Geithner and Bernanke continued in power with Geithner moving from the New York Federal Reserve (where he served as I recall under a Chair from Goldman Sachs) to Treasury in the Obama Administration, but Geithner's Treasury was staffed from Goldman Sachs, JP Morgan Chase and Citibank. The crisis served to concentrate banking assets in the hands of the top five banks, but it seemed also to transfer political power entirely into their hands as well. Simon Johnson called it a coup.

I don't know what considerations guided Obama in choosing the size of the stimulus or its composition (as spending and tax cuts). Larry Summers was identified at the time as a voice of caution, not "gambling", but not much is known about his detailed reasoning in severely trimming Christina Romer's entirely conventional calculations. (One consideration might well have been worldwide resource shortages, which had made themselves felt in 2007-8 as an inflationary spike in commodity prices.) I do not see a case for connecting stimulus size policy to the health care reform. At the time the stimulus was proposed, the Administration had also been considering whether various big banks and other financial institutions should be nationalized, forced to insolvency or otherwise restructured as part of a regulatory reform.

Here's the thing: the globalization and financialization of the economy from roughly 1980 drove both increasingly extreme distribution of income and de-industrialization. Accelerating the financialization of the economy from 1999 on made New York and Washington rich, but the same economic policies and process were devastating the Rust Belt as de-industrialization. They were two aspects of the same complex of economic trends and policies. The rise of China as a manufacturing center was, in critical respects, a financial operation within the context of globalized trade that made investment in new manufacturing plant in China, as part of globalized supply chains and global brand management, (arguably artificially) low-risk and high-profit, while reinvestment in manufacturing in the American mid-west became unattractive, except as a game of extracting tax subsidies or ripping off workers.

It was characteristic of neoliberalism that the policy, policy intention and policy consequences were hidden behind a rhetoric of markets and technological inevitability. Matt Stoller has identified this as the statecraft of neoliberalism: the elimination of political agency and responsibility for economic performance and outcomes. Globalization and financialization were just "forces" that just happened, in a meteorological economics.

It is conceding too many good intentions to the Obama Administration to tie an inadequate stimulus to a Rube Goldberg health care reform as the origin story for the final debacle of Democratic neoliberal politics. There was a delicate balancing act going on, but they were not balancing the recovery of the economy in general so much as they were balancing the recovery from insolvency of a highly inefficient and arguably predatory financial sector, which was also not incidentally financing the institutional core of the Democratic Party and staffing many key positions in the Administration and in the regulatory apparatus.

This was not your grandfather's Democratic Party and it was a Democratic Party that could aid the working class and the Rust Belt only within fairly severe and sometimes sharply conflicting constraints.

No one in the Democratic Party had much institutional incentive to connect the dots, and draw attention to the acute conflicts over the distribution of income and wealth involved in financialization of the economy (including financialization as a driver of health care costs). And, that makes the political problem that much harder, because there are no resources for rhetorical and informational clarity or coherence.

bruce wilder 11.16.16 at 10:33 pm ( 31 )

The short version of my thinking on the Obama stimulus is this: Keynesian stimulus spending is a free lunch; it doesn't really matter what you spend money on up to a very generous point, so it seems ready-made for legislative log-rolling. If Obama could not get a very big stimulus indeed thru a Democratic Congress long out of power, Obama wasn't really trying. And, well-chosen spending on pork barrel projects is popular and gets Congressional critters re-elected. So, again, if the stimulus is small and the Democratic Congress doesn't get re-elected, Obama isn't really trying.

Again, it comes down to: by 2008, the Democratic Party is not a fit vehicle for populism, because it has become a neoliberal vehicle for giant banks. Turns out that makes a policy difference.

likbez 11.18.16 at 4:48 pm 121

bruce wilder 11.16.16 at 10:07 pm 30

Great comment. Simply great. Hat tip to the author !

Notable quotes:

"… The New Deal did not seek to overthrow the plutocracy, but it did seek to side-step and disable their dominance. …"

"… It seems to me that while neoliberalism on the right was much the same old same old, the neoliberal turn on the left was marked by a measured abandonment of this struggle over the distribution of income between the classes. In the U.S., the Democrats gradually abandoned their populist commitments. In Europe, the labour and socialist parties gradually abandoned class struggle. …"

"… When Obama came in, in 2008 amid the unfolding GFC, one of the most remarkable features of his economic team was the extent to which it conceded control of policy entirely to the leading money center banks. Geithner and Bernanke continued in power with Geithner moving from the New York Federal Reserve (where he served as I recall under a Chair from Goldman Sachs) to Treasury in the Obama Administration, but Geithner's Treasury was staffed from Goldman Sachs, JP Morgan Chase and Citibank. The crisis served to concentrate banking assets in the hands of the top five banks, but it seemed also to transfer political power entirely into their hands as well. Simon Johnson called it a coup. … "

"… Here's the thing: the globalization and financialization of the economy from roughly 1980 drove both increasingly extreme distribution of income and de-industrialization. …"

"… It was characteristic of neoliberalism that the policy, policy intention and policy consequences were hidden behind a rhetoric of markets and technological inevitability. Matt Stoller has identified this as the statecraft of neoliberalism: the elimination of political agency and responsibility for economic performance and outcomes. Globalization and financialization were just "forces" that just happened, in a meteorological economics. …"

"… This was not your grandfather's Democratic Party and it was a Democratic Party that could aid the working class and the Rust Belt only within fairly severe and sometimes sharply conflicting constraints. …"

"… No one in the Democratic Party had much institutional incentive to connect the dots, and draw attention to the acute conflicts over the distribution of income and wealth involved in financialization of the economy (including financialization as a driver of health care costs). And, that makes the political problem that much harder, because there are no resources for rhetorical and informational clarity or coherence. …"

"… If Obama could not get a very big stimulus indeed thru a Democratic Congress long out of power, Obama wasn't really trying. And, well-chosen spending on pork barrel projects is popular and gets Congressional critters re-elected. So, again, if the stimulus is small and the Democratic Congress doesn't get re-elected, Obama isn't really trying. …"

"… Again, it comes down to: by 2008, the Democratic Party is not a fit vehicle for populism, because it has become a neoliberal vehicle for giant banks. Turns out that makes a policy difference. …"

[Nov 14, 2016] Clinton betrayal and the future of Democratic Party

Nov 14, 2016 | discussion.theguardian.com
weejonnie Intheround 11h ago ...In the last 8 years the Democrat party.

Lost control of the Senate
Lost control of the House of Representatives
Lost control of dozens of state legislatures and Governorships.
The Republicans control 36 States of America - One more and they could in theory amend the Constitution.

In Wisconsin (notionally Democrat) the Legislature and Governor are both Republican controlled. And Clinton didn't even campaign there when it was pretty obvious the State was not trending towards her.

[Nov 11, 2016] Chelsea Clinton was not paid $600 k from the Clinton Foundation. Chelsea Clinton was paid $600 k per year from 2011 by NBC for work as a special correspondent, whilst also pocketing $300 k per year plus stock options as a board member of IAC. Chelseas speaking fees were a mere 65 thousand dollars

Nov 11, 2016 | crookedtimber.org

kidneystones 11.10.16 at 10:39 am 161

... .. ...

@138 The woman is wrong. Chelsea Clinton was not paid $600 k from the Clinton Foundation. Chelsea Clinton was paid $600 k per year from 2011 by NBC for 'work' as a special correspondent, whilst also pocketing $300 k per year plus stock options as a 'board member' of IAC. Chelsea's speaking fees were a mere $65 k per.

http://www.politico.com/magazine/story/2016/02/chelsea-clinton-press-213596

The NYT offers a more severe critique of the IAC board deal readable by clicking through the links. There will be those who see nothing improper about a fifth-estate firm paying a 31 year-old graduate student $600 k, or awarding her a board seat and stock options at $300k. Others may disagree, and perhaps with some good reason.

The defeat of the democratic candidate by a rodeo clown is a slap in the face. Contra Manta @71 I do not believe that anything less than a slap in the face of this order would be enough to jar the successful and well-fed out of their state of complacency and indifference to the plight of both the blacks and whites left behind by 8 years of Democratic rule, and far longer when we're talking about urban African-Americans.

As noted, I believe the Republican candidate to be far and away the more sober, safer choice both on domestic and foreign policy. Now we'll find out.

Thanks for the kind words to Rich, Bruce, T, bob mc, and others.

Best to you all.

[Nov 11, 2016] Obama can pardon Clinton Foundation players without specified which crimes they committed

Nov 11, 2016 | www.moonofalabama.org
Ken Nari | Nov 11, 2016 2:51:53 PM | 55
Susan Sunflower @ 48

Disgusting as it is, yes, my understanding is Obama can do exactly that. My guess is, want to or not, he probably will come under so much pressure he will have to pass out plenty of pardons. Or maybe Lynch will give everyone involved in the Clinton Foundation immunity to testify and then seal the testimony -- or never bother to get any testimony. So many games.

For Obama, it might not even take all that much pressure. From about his second day in office, from his body language, he's always looked like he was scared.

Instead of keeping his mouth shut, which he would do, being the lawyer he is, Giuliani has been screaming for the Clintons' scalps. That's exactly what a sharp lawyer would do if he was trying to force Obama to pardon them. If he really meant to get them he would be agreeing with the FBI, saying there doesn't seem to be any evidence of wrong doing, and then change his mind once (if) he's AG and it's too late for deals.

With so many lawyers, Obama, the Clintons, Lynch, Giuliani, Comey, no justice is likely to come out of this.

h | Nov 11, 2016 2:53:37 PM | 56
Maybe I saw the question about a 9/11 investigation on the other thread, but someone here asked if this is true. Well, it appears to be on a burner -

http://www.thedailybell.com/news-analysis/trump-reopening-911-reversing-rome-in-bid-to-be-greatest-american-steward/

jdmckay | Nov 11, 2016 2:58:20 PM | 57
Ken Nari @ 55

From what I've read, prez pardon comes with explicit admission of guilt. Highly questionable either (or both) Clintons would accept that.

Mina | Nov 11, 2016 3:03:16 PM | 58
Simply brilliant
https://theintercept.com/2016/11/09/democrats-trump-and-the-ongoing-dangerous-refusal-to-learn-the-lesson-of-brexit/
(it could be on the other thread, sorry)

Susan Sunflower | Nov 11, 2016 3:12:12 PM | 59
@ Posted by: Ken Nari | Nov 11, 2016 2:51:53 PM | 55

I heard a podcast on Batchelor with Charles Ortel which explained some things -- even if there are no obvious likely criminal smoking guns -- given that foundations get away with a lot of "leniency" because they are charities, incomplete financial statements and chartering documents, as I recall. I was most interested in his description of the number of jurisdictions the Foundation was operating under, some of whom, like New York were already investigating; and others, foreign who might or might be, who also have very serious regulations, opening the possibility that if the Feds drop their investigation, New York (with very very strict law) might proceed, and that they might well be investigated (prosecuted/banned??) in Europe.

The most recent leak wrt internal practices was just damning ... it sounded like a playground of favors and sinecures ... no human resources department, no written policies on many practices ...

This was an internal audit and OLD (2008, called "the Gibson Review") so corrective action may have been taken, but I thought was damning enough to deter many donors (even before Hillary's loss removed that incentive) particularly on top of the Band (2011) memo. Unprofessional to the extreme.

It's part of my vast relief that Clinton lost and will not be in our lives 24/7/365 for the next 4 years. (I think Trump is an unprincipled horror, but that's as may be, I'm not looking for a fight). After the mess Clinton made of Haiti (and the accusations/recriminations) I somehow thought they'd have been more careful with their "legacy" -- given that it was founded in 1997, 2008 is a very long time to be operating without written procedures wrt donations, employment

from 11/08/2016, Batchelor segment page

[Nov 06, 2016] Trump vs. the REAL Nuts -- the GOP Uniparty Establishment

Notable quotes:
"... An awful lot of people out there think we live in a one-party state-that we're ruled by what is coming to be called the "Uniparty." ..."
"... There is a dawning realization, ever more widespread among ordinary Americans, that our national politics is not Left versus Right or Republican versus Democrat; it's we the people versus the politicians. ..."
"... Donald Trump is no nut. If he were a nut, he would not have amassed the fortune he has, nor nurtured the capable and affectionate family he has. ..."
"... To be conservative, then, is to prefer the familiar to the unknown, to prefer the tried to the untried, fact to mystery, the actual to the possible, the limited to the unbounded, the near to the distant, the sufficient to the superabundant, the convenient to the perfect, present laughter to utopian bliss. ..."
"... Trump has all the right instincts. And he's had the guts and courage-and, just as important, the money -to do a thing that has badly needed doing for twenty years: to smash the power of the real nuts in the GOP Establishment. ..."
Oct 29, 2016 | www.unz.com
54 Comments Credit: VDare.com.

A couple of remarks in Professor Susan McWillams' recent Modern Age piece celebrating the 25th anniversary of Christopher Lasch's 1991 book The True and Only Heaven , which analyzed the cult of progress in its American manifestation, have stuck in my mind. Here's the first one:

In the most recent American National Election Studies survey, only 19 percent of Americans agreed with the idea that the government, "is run for the benefit of all the people." [ The True and Only Lasch: On The True and Only Heaven, 25 Years Later , Fall 2016]

McWilliams adds a footnote to that: The 19 percent figure is from 2012, she says. Then she tells us that in 1964, 64 percent of Americans agreed with the same statement.

Wow. You have to think that those two numbers, from 64 percent down to 19 percent in two generations, tell us something important and disturbing about our political life.

Second McWilliams quote:

In 2016 if you type the words "Democrats and Republicans" or "Republicans and Democrats" into Google, the algorithms predict your next words will be "are the same".

I just tried this, and she's right. These guesses are of course based on the frequency with which complete sentences show up all over the internet. An awful lot of people out there think we live in a one-party state-that we're ruled by what is coming to be called the "Uniparty."

There is a dawning realization, ever more widespread among ordinary Americans, that our national politics is not Left versus Right or Republican versus Democrat; it's we the people versus the politicians.

Which leads me to a different lady commentator: Peggy Noonan, in her October 20th Wall Street Journal column.

The title of Peggy's piece was: Imagine a Sane Donald Trump . [ Alternate link ]Its gravamen: Donald Trump has shown up the Republican Party Establishment as totally out of touch with their base, which is good; but that he's bat-poop crazy, which is bad. If a sane Donald Trump had done the good thing, the showing-up, we'd be on course to a major beneficial correction in our national politics.

It's a good clever piece. A couple of months ago on Radio Derb I offered up one and a half cheers for Peggy, who gets a lot right in spite of being a longtime Establishment Insider. So it was here. Sample of what she got right last week:

Mr. Trump's great historical role was to reveal to the Republican Party what half of its own base really thinks about the big issues. The party's leaders didn't know! They were shocked, so much that they indulged in sheer denial and made believe it wasn't happening.

The party's leaders accept more or less open borders and like big trade deals. Half the base does not! It is longtime GOP doctrine to cut entitlement spending. Half the base doesn't want to, not right now! Republican leaders have what might be called assertive foreign-policy impulses. When Mr. Trump insulted George W. Bush and nation-building and said he'd opposed the Iraq invasion, the crowds, taking him at his word, cheered. He was, as they say, declaring that he didn't want to invade the world and invite the world. Not only did half the base cheer him, at least half the remaining half joined in when the primaries ended.

I'll just pause to note Peggy's use of Steve Sailer' s great encapsulation of Bush-style NeoConnery: "Invade the world, invite the world." Either Peggy's been reading Steve on the sly, or she's read my book We Are Doomed , which borrows that phrase. I credited Steve with it, though, so in either case she knows its provenance, and should likewise have credited Steve.

End of pause. OK, so Peggy got some things right there. She got a lot wrong, though

Start with the notion that Trump is crazy. He's a nut, she says, five times. His brain is "a TV funhouse."

Well, Trump has some colorful quirks of personality, to be sure, as we all do. But he's no nut. A nut can't be as successful in business as Trump has been.

I spent 32 years as an employee or contractor, mostly in private businesses but for two years in a government department. Private businesses are intensely rational, as human affairs go-much more rational than government departments. The price of irrationality in business is immediate and plainly financial. Sanity-wise, Trump is a better bet than most people in high government positions.

Sure, politicians talk a good rational game. They present as sober and thoughtful on the Sunday morning shows.

Look at the stuff they believe, though. Was it rational to respond to the collapse of the U.S.S.R. by moving NATO right up to Russia's borders? Was it rational to expect that post-Saddam Iraq would turn into a constitutional democracy? Was it rational to order insurance companies to sell healthcare policies to people who are already sick? Was the Vietnam War a rational enterprise? Was it rational to respond to the 9/11 attacks by massively increasing Muslim immigration?

Make your own list.

Donald Trump displays good healthy patriotic instincts. I'll take that, with the personality quirks and all, over some earnest, careful, sober-sided guy whose head contains fantasies of putting the world to rights, or flooding our country with unassimilable foreigners.

I'd add the point, made by many commentators, that belongs under the general heading: "You don't have to be crazy to work here, but it helps." If Donald Trump was not so very different from run-of-the-mill politicians-which I suspect is a big part of what Peggy means by calling him a nut-would he have entered into the political adventure he's on?

Thor Heyerdahl sailed across the Pacific on a hand-built wooden raft to prove a point, which is not the kind of thing your average ethnographer would do. Was he crazy? No, he wasn't. It was only that some feature of his personality drove him to use that way to prove the point he hoped to prove.

And then there is Peggy's assertion that the Republican Party's leaders didn't know that half the party's base were at odds with them.

Did they really not? Didn't they get a clue when the GOP lost in 2012, mainly because millions of Republican voters didn't turn out for Mitt Romney? Didn't they, come to think of it, get the glimmering of a clue back in 1996, when Pat Buchanan won the New Hampshire primary?

Pat Buchanan is in fact a living counter-argument to Peggy's thesis-the "sane Donald Trump" that she claims would win the hearts of GOP managers. Pat is Trump without the personality quirks. How has the Republican Party treated him ?

Our own Brad Griffin , here at VDARE.com on October 24th, offered a couple more "sane Donald Trumps": Ron Paul and Mike Huckabee. How did they fare with the GOP Establishment?

Donald Trump is no nut. If he were a nut, he would not have amassed the fortune he has, nor nurtured the capable and affectionate family he has. Probably he's less well-informed about the world than the average pol. I doubt he could tell you what the capital of Burkina Faso is. That's secondary, though. A President has people to look up that stuff for him. The question that's been asked more than any other about Donald Trump is not, pace Peggy Noonan, "Is he nuts?" but, " Is he conservative? "

I'm sure he is. But my definition of "conservative" is temperamental, not political. My touchstone here is the sketch of the conservative temperament given to us by the English political philosopher Michael Oakeshott :

To be conservative, then, is to prefer the familiar to the unknown, to prefer the tried to the untried, fact to mystery, the actual to the possible, the limited to the unbounded, the near to the distant, the sufficient to the superabundant, the convenient to the perfect, present laughter to utopian bliss.

Rationalism in Politics and other essays (1962)

That fits Trump better than it fits any liberal you can think of-better also than many senior Republicans.

For example, it was one of George W. Bush's senior associates-probably Karl Rove-who scoffed at opponents of Bush's delusional foreign policy as "the reality-based community." It would be hard to think of a more un -Oakeshottian turn of phrase.

Trump has all the right instincts. And he's had the guts and courage-and, just as important, the money -to do a thing that has badly needed doing for twenty years: to smash the power of the real nuts in the GOP Establishment.

I thank him for that, and look forward to his Presidency.

[Nov 03, 2016] Report Indictment likely in FBIs Clinton Foundation probe

Nov 03, 2016 | www.thehill.com
Two sources with intimate knowledge of the FBI's investigations told Fox News Wednesday that a probe of the Clinton Foundation is likely to lead to an indictment.

Fox News's Bret Baier said Wednesday that the FBI probe into a possible pay-to-play scheme between Democratic presidential nominee and the Clinton Foundation has been going on for over a year. Sources told the news network that the investigation, which is conducted by the White Collar Crime division of the FBI, is a "very high priority."

One source further stated that the bureau collected "a lot of" evidence, adding that "there is an avalanche of new information coming every day." Baier also said that the Clinton Foundation probe is more expansive than previously thought, and that many individuals have been interviewed several times throughout the course of the investigation. Sources said that they are "actively and aggressively pursuing this case" and that investigations are likely to continue. Baier added that when he pressed the sources about the details of both probes, they told him that they are likely to lead to an indictment. Additionally, Baier reported that according to Fox News's sources, Clinton's private email server had been breached by at least five foreign intelligence hackers. FBI Director James Comey said in July that he could not say definitively whether her server had been breached.

[Nov 03, 2016] Secret Recordings Fueled Mutinous FBI Investigation of Clintons Despite DOJ Orders To Stand Down

Nov 03, 2016 | www.zerohedge.com
It's looking increasingly like there is an ongoing mutiny underway within the FBI as the Wall Street Journal is reporting that, according to "officials at multiple agencies", FBI agents felt they had adequate evidence, including "secret recordings of a suspect talking about the Clinton Foundation" , to pursue an investigation of the Clinton Foundation but were repeatedly obstructed by officials at the Department of Justice.

Secret recordings of a suspect talking about the Clinton Foundation fueled an internal battle between FBI agents who wanted to pursue the case and corruption prosecutors who viewed the statements as worthless hearsay, people familiar with the matter said.

The roots of the dispute lie in a disagreement over the strength of the case, these people said, which broadly centered on whether Clinton Foundation contributors received favorable treatment from the State Department under Hillary Clinton.

Senior officials in the Justice Department and the FBI didn't think much of the evidence, while investigators believed they had promising leads their bosses wouldn't let them pursue , they said.

Despite clear signals from the Justice Department to abandon the Clinton Foundation inquiries, many FBI agents refused to stand down. Then, earlier this year in February 2016, the FBI presented initial evidence at a meeting with Leslie Caldwell, the head of the DOJ's criminal division, after which agents were delivered a clear message that "we're done here." But, as the WSJ points out, DOJ became increasing frustrated with FBI agents that were " disregarding or disobeying their instructions" which subsequently prompted an emphatic "stand down" message from the DOJ to "all the offices involved."

As 2015 came to a close, the FBI and Justice Department had a general understanding that neither side would take major action on Clinton Foundation matters without meeting and discussing it first. In February, a meeting was held in Washington among FBI officials, public-integrity prosecutors and Leslie Caldwell, the head of the Justice Department's criminal division. Prosecutors from the Eastern District of New York-Mr. Capers' office-didn't attend, these people said.

The public-integrity prosecutors weren't impressed with the FBI presentation, people familiar with the discussion said. "The message was, 'We're done here,' " a person familiar with the matter said.

Justice Department officials became increasingly frustrated that the agents seemed to be disregarding or disobeying their instructions.

Following the February meeting, officials at Justice Department headquarters sent a message to all the offices involved to " stand down ,'' a person familiar with the matter said.

The FBI had secretly recorded conversations of a suspect in a public-corruption case talking about alleged deals the Clintons made , these people said. The agents listening to the recordings couldn't tell from the conversations if what the suspect was describing was accurate, but it was, they thought, worth checking out.

[Nov 03, 2016] Former UK Army Chief Trump Might Make The World Safer

www.breitbart.com
In an interview with House magazine, Lord Richards of Herstmonceux – the former Chief of the Defence staff – said Mr. Trump is "wise enough to get good people round him and probably knows that he's got to listen to them and therefore I think we should not automatically think it will be less safe".

He added: "It's non-state actors like Isis that are the biggest threat to our security. If countries and states could coalesce better to deal with these people – and I think Trump's instinct is to go down that route – then I think there's the case for saying that the world certainly won't be any less safe.

"It's that lack of understanding and empathy with each other as big power players that is a risk to us all at the moment.

"Therefore I think he would reinvigorate big power relationships, which might make the world ironically safer."

During the interview Lord Richards also discussed the somewhat controversial view that the West should partner with Russia and Bashar al-Assad to take back the Syrian city of Aleppo.

He said: "If the humanitarian situation in Syria is our major concern, which it should be – millions of lives have been ruined, hundreds of thousands have been killed – I believe there is a strong case for allowing Assad to get in there and take the city back.

"The opposition groups – many of whom are not friends of ours, they're extremists – are now intermingled with the original good opposition groups, are fighting from amongst the people. The only quick way of solving it is to allow Assad to win. There's no way the opposition groups are going to win."

Lord Richards added: "We want the humanitarian horror of Aleppo to come to a rapid halt. The best and quickest way of doing that is to encourage the opposition groups to leave. The Russians are undoubtedly using their weapons indiscriminately. If they're going to attack those groups then there is inevitably going to be civilian casualties.

"The alternative is for the West to declare a no-fly zone and that means you've got to be prepared to go to war with Russia ultimately. I see no appetite for that and nor, frankly, do I see much sense in it. It sticks in my throat to say it because I have no love for Assad.

"The fact is, the only way to get it to stop now is to allow Assad to win and win quickly and then turn on Isis with the Russians."

[Nov 03, 2016] FBI Sources Tell Fox News An Indictment Is Likely In Clinton Foundation Case Video

www.realclearpolitics.com

RealClearPolitics

Fox News Channel's Bret Baier reports the latest news about the Clinton Foundation investigation from two sources inside the FBI. He reveals five important new pieces of information in these two short clips:

[Nov 03, 2016] Podesta is also the appointed Congressional lobbyist for the Kingdom of Saudi Arabia

Nov 03, 2016 | www.zerohedge.com
. . . _ _ _ . . . Nov 3, 2016 9:24 AM ,
" Podesta is also the appointed Congressional lobbyist for the Kingdom of Saudi Arabia – for the modest amount of $200,000 per month."

[Nov 03, 2016] The FBIs White Collar Crime Unit Is Probing The Clinton Foundation

Notable quotes:
"... In the latest update from Fox's Bret Baier , we learn that the Clinton Foundation investigation has now taken a "very high priority," perhaps courtesy of new documents revealed by Wikileaks which expressed not only a collusive element between Teneo, the Clinton Foundation and the "charitable foundation's" donors, which included the use of funds for personal gain, but also revealed deep reservations by people within the foundation about ongoing conflicts of interest. ..."
"... FBI agents are "actively and aggressively pursuing this case," and will be going back and interviewing the same people again, some for the third time, Baier's sources said. Agents also are going through what Clinton and top aides have said in previous interviews as well as the FBI 302 documents, which agents use to report interviews they conduct, to make sure notes line up, according to sources. ..."
"... As expected, the Clinton Foundation denied everything, and Foundation spokesman, Craig Minassian, told Fox news a statement: "We're not aware of any investigation into the Foundation by the Department of Justice, Federal Bureau of Investigation, or any United States Attorney's Office and we have not received a subpoena from any of those agencies." ..."
"... Now that details of the infighting between the DOJ and FBI regarding the Foundation probe have been made public, Loretta Lynch may have no choice but to launch an official probe, including subpoeans. ..."
"... The information follows a report over the weekend by The Wall Street Journal that four FBI field offices have been collecting information about the foundation. The probes – in addition to the revived email investigation – have fueled renewed warnings from Republicans that if Clinton is elected next week, she could take office under a cloud of investigations. ..."
"... Separately, Fox News reports that authorities also are virtually certain, i.e., "there is about a 99 percent chance", that up to five foreign intelligence agencies may have accessed and taken emails from Hillary Clinton's private server, two separate sources with intimate knowledge of the FBI investigations told Fox News. If so, it would suggest that the original FBI probe - which found no evidence of breach - was either incomplete or tampered with. ..."
"... In other words, Anthony Weiner may be ultimately responsible not only for the downfall of Hillary Clinton's presidential candidacy, but also the collapse of the entire Clinton Foundation... which incidentally is just what Donald Trump warned could happen over a year ago. ..."
Zero Hedge
Now that thanks to first the WSJ, and then Fox News, the public is aware that a probe into the Clinton Foundation is not only a hot topic for both the FBI and the DOJ (and has managed to split the law enforcement organizations along ideological party lines), but is also actively ongoing despite the DOJ's attempts to squash it.

In the latest update from Fox's Bret Baier, we learn that the Clinton Foundation investigation has now taken a "very high priority," perhaps courtesy of new documents revealed by Wikileaks which expressed not only a collusive element between Teneo, the Clinton Foundation and the "charitable foundation's" donors, which included the use of funds for personal gain, but also revealed deep reservations by people within the foundation about ongoing conflicts of interest.

As Baier also notes, the Clinton Foundation probe has been proceeding for more than a year, led by the White-Collar Crime division.

Fox adds that even before the WikiLeaks dumps of alleged emails linked to the Clinton campaign, FBI agents had collected a great deal of evidence, and FBI agents have interviewed and re-interviewed multiple people regarding the case.

"There is an avalanche of new information coming in every day," one source told Fox News, adding some of the new information is coming from the WikiLeaks documents and new emails.

FBI agents are "actively and aggressively pursuing this case," and will be going back and interviewing the same people again, some for the third time, Baier's sources said. Agents also are going through what Clinton and top aides have said in previous interviews as well as the FBI 302 documents, which agents use to report interviews they conduct, to make sure notes line up, according to sources.

As expected, the Clinton Foundation denied everything, and Foundation spokesman, Craig Minassian, told Fox news a statement: "We're not aware of any investigation into the Foundation by the Department of Justice, Federal Bureau of Investigation, or any United States Attorney's Office and we have not received a subpoena from any of those agencies."

Now that details of the infighting between the DOJ and FBI regarding the Foundation probe have been made public, Loretta Lynch may have no choice but to launch an official probe, including subpoeans.

The information follows a report over the weekend by The Wall Street Journal that four FBI field offices have been collecting information about the foundation. The probes – in addition to the revived email investigation – have fueled renewed warnings from Republicans that if Clinton is elected next week, she could take office under a cloud of investigations.

"This is not just going to go away … if she ends up winning the election," Rep. Ron DeSantis, R-Fla., told Fox News' "America's Newsroom" earlier this week.

Donald Trump has referenced this scenario, repeatedly saying on the stump this past week that her election could trigger a "crisis."

Separately, Fox News reports that authorities also are virtually certain, i.e., "there is about a 99 percent chance", that up to five foreign intelligence agencies may have accessed and taken emails from Hillary Clinton's private server, two separate sources with intimate knowledge of the FBI investigations told Fox News. If so, it would suggest that the original FBI probe - which found no evidence of breach - was either incomplete or tampered with.

The revelation led House Homeland Security Committee Chairman Michael McCaul to describe Clinton's handling of her email system during her tenure as secretary of state as "treason."

"She exposed [information] to our enemies," McCaul said on "Fox & Friends" Thursday morning. "Our adversaries have this very sensitive information. … In my opinion, quite frankly, it's treason."

McCaul, R-Texas, said that FBI Director James Comey told him previously that foreign adversaries likely had gotten into her server. When Comey publicly discussed the Clinton email case back in July, he also said that while there was no evidence hostile actors breached the server, it was "possible" they had gained access.

Clinton herself later pushed back, saying the director was merely "speculating."

But sources told Fox News that Comey should have said at the time there is an "almost certainty" that several foreign intelligence agencies hacked into the server.

The claims come as Comey's FBI not only revisits the email investigation following the discovery of additional emails on the laptop of ex-Rep. Anthony Weiner – the estranged husband of Clinton aide Huma Abedin – but is proceeding in its investigation of the Clinton Foundation.

In other words, Anthony Weiner may be ultimately responsible not only for the downfall of Hillary Clinton's presidential candidacy, but also the collapse of the entire Clinton Foundation... which incidentally is just what Donald Trump warned could happen over a year ago.

A summary of Baier's latest reporting is in the clip below...

[Nov 03, 2016] The FBI suddenly discloses dismissed Bill Clinton case

speisa.com

The FBI has unexpectedly published papers from an over ten-year-old investigation of former president Bill Clinton's controversial pardon of a financier, reports NTB.

The case against Clinton was dismissed without charges in 2005, and several Democrats therefore question why the 129-page report of the investigation is published right now, a few days before the election, in which Bill Clinton's wife Hillary Clinton is trying to become president.

The rage against the FBI is already great in the Democratic Party after the federal police last week announced they will investigate new emails relating to Hillary Clinton.

Financier Marc Rich was indicted for tax fraud and lived in exile in Switzerland when Bill Clinton pardoned him on his last day as president on January 20, 2001. Several reacted to the pardon, especially since Rich's ex-wife was a major donor to the Democratic Party.

The FBI started to investigate the pardon the year after.

[Nov 03, 2016] FBI investigating Clinton Foundation pay for play scheme

Notable quotes:
"... FBI agents have interviewed and re-interviewed multiple people on the foundation case, which is looking into possible pay for play interaction between then-Secretary of State Hillary Clinton and the Clinton Foundation. The FBI's White Collar Crime Division is handling the investigation. ..."
"... Even before the WikiLeaks dumps of alleged emails linked to the Clinton campaign, FBI agents had collected a great deal of evidence, law enforcement sources tell Fox News. ..."
"... "There is an avalanche of new information coming in every day," one source told Fox News, who added some of the new information is coming from the WikiLeaks documents and new emails. ..."
Nov 03, 2016 | speisa.com

A second FBI investigation involving Hillary Clinton is ongoing. The investigation to uncover corruption by the Clinton Foundation and Hillary Clinton, is given high priority and now runs parallel with the reopened FBI case of her using a private email server to avoid the Federal Records Act.

The FBI's investigation into the Clinton Foundation that has been going on for more than a year has now taken a "very high priority," separate sources with intimate knowledge of the probe tell Fox News .

FBI agents have interviewed and re-interviewed multiple people on the foundation case, which is looking into possible pay for play interaction between then-Secretary of State Hillary Clinton and the Clinton Foundation. The FBI's White Collar Crime Division is handling the investigation.

Even before the WikiLeaks dumps of alleged emails linked to the Clinton campaign, FBI agents had collected a great deal of evidence, law enforcement sources tell Fox News.

"There is an avalanche of new information coming in every day," one source told Fox News, who added some of the new information is coming from the WikiLeaks documents and new emails.

FBI agents are "actively and aggressively pursuing this case," and will be going back and interviewing the same people again, some for the third time, sources said.

Agents are also going through what Clinton and top aides have said in previous interviews and the FBI 302, documents agents use to report interviews they conduct, to make sure notes line up, according to sources.

[Oct 30, 2016] FBI Investigation Into Bribery With Clinton Foundation Spans Nation, Multiple Field Offices, Says WSJ

Notable quotes:
"... It appears there was rift between the FBI and the DOJ with how to move forward with the investigation. Agents in the Washington office were directed to focus on a separate issue relating to the actions of former Virginia Governor and Clinton Foundation Board Member Terry McAuliffe. Agents inside the FBI believed they could build a stronger case if the investigation of McAuliffe and the foundation were combined. ..."
"... FBI Deputy Director Andrew McCabe seemed to be caught in the middle of the fight between DOJ officials who appeared to want to slow down or shut down the investigation and FBI agents who were eager to pour more resources into the investigation. ..."
"... The story gets more complicated when you factor in that McCabe's wife, Dr. Jill McCabe had received a $467,500 campaign contribution in 2015 for a state senate race from McAuliffe . ..."
"... CNN also reported that multiple field offices were "in agreement a public corruption investigation should be launched" with Clinton Foundation officials as a target. The cable news network reported the investigation would have looked at "conflicts of interest by foreign donors and official acts by Hillary Clinton as Secretary of State. ..."
Oct 30, 2016 | www.breitbart.com
FBI investigators from across the country have been following leads into reports of bribery involving the Clinton Foundation. Multiple field offices have been involved in the investigation.

A report in Sunday's Wall Street Journal (WSJ) by Devlin Barrett revealed that agents assigned to the New York field office have been carrying the bulk of the work in investigating the Clinton Foundations. They have received assistance from the FBI field office in Little Rock according to "people familiar with the matter, the WSJ reported. Other offices, including Los Angeles and Washington, D.C., have been collecting evidence to regarding "financial crimes or influence-peddling."

As far back as February 2016, FBI agents made presentation to the Department of Justice (DOJ), the WSJ's sources stated. "The meeting didn't go well," they wrote. While some sources said the FBI's evidence was not strong enough, others believed the DOJ had no intention from the start of going any further. Barrett wrote that the DOJ officials were "stern, icy and dismissive of the case."

Barrett wrote, "'That was one of the weirdest meetings I've ever been to,' one participant told others afterward, according to people familiar with the matter."

It appears there was rift between the FBI and the DOJ with how to move forward with the investigation. Agents in the Washington office were directed to focus on a separate issue relating to the actions of former Virginia Governor and Clinton Foundation Board Member Terry McAuliffe. Agents inside the FBI believed they could build a stronger case if the investigation of McAuliffe and the foundation were combined.

FBI Deputy Director Andrew McCabe seemed to be caught in the middle of the fight between DOJ officials who appeared to want to slow down or shut down the investigation and FBI agents who were eager to pour more resources into the investigation.

Barrett wrote, "'Are you telling me that I need to shut down a validly predicated investigation?' Mr. McCabe asked, according to people familiar with the conversation. After a pause, the official replied, 'Of course not,' these people said."

Some of the WSJ sources told Barrett that a "stand down" order had been given to the FBI agents by McCabe. Others denied that no such order was given.

Preet Bharara, an assistant U.S. Attorney for the Southern District of New York, appears to have taken in interest in moving forward from the DOJ side, the Daily Caller's Richard Pollock reported in August.

Pollock wrote:

The New York-based probe is being led by Preet Bharara, the U.S. attorney for the Southern District of New York. Bharara's prosecutorial aggressiveness has resulted in a large number of convictions of banks, hedge funds and Wall Street insiders.

He said prosecutorial support could come from multiple U.S. Attorneys Offices and stated this was a major departure from other "centralized FBI investigations."

The story gets more complicated when you factor in that McCabe's wife, Dr. Jill McCabe had received a $467,500 campaign contribution in 2015 for a state senate race from McAuliffe .

CNN also reported that multiple field offices were "in agreement a public corruption investigation should be launched" with Clinton Foundation officials as a target. The cable news network reported the investigation would have looked at "conflicts of interest by foreign donors and official acts by Hillary Clinton as Secretary of State.

[Oct 30, 2016] Former FBI Official Calls Bill, Hillary Clinton a Crime Family

Notable quotes:
"... "The problem here is this investigation was never a real investigation," he said. "That's the problem. They never had a grand jury empanelled, and the reason they never had a grand jury empanelled, I'm sure, is Loretta Lynch would not go along with that." ..."
"... Kallstrom blamed the FBI leadership under FBI Director James Comey as the reason the investigation was held back, but not the rest of the bureau. ..."
"... "The agents are furious with what's going on, I know that for a fact," he said. ..."
Oct 30, 2016 | www.breitbart.com
A former FBI official said Sunday that Bill and Hillary Clinton are part of a "crime family" and added that top officials impeded the investigation into Clinton's email server while she was secretary of state.

Former assistant FBI director James Kallstrom praised Donald Trump before he offered a take down of the Clintons in a radio interview with John Catsimatidis, The Hill reported.

"The Clintons, that's a crime family, basically," Kallstrom said. "It's like organized crime. I mean the Clinton Foundation is a cesspool."

Kallstrom, best known for spearheading the investigation into the explosion of TWA flight 800 in the late '90s, called Clinton a "pathological liar" and blamed Attorney General Loretta Lynch for botching the Clinton email server investigation.

"The problem here is this investigation was never a real investigation," he said. "That's the problem. They never had a grand jury empanelled, and the reason they never had a grand jury empanelled, I'm sure, is Loretta Lynch would not go along with that."

"God forbid we put someone like that in the White House," he added of Clinton.

Kallstrom blamed the FBI leadership under FBI Director James Comey as the reason the investigation was held back, but not the rest of the bureau.

"The agents are furious with what's going on, I know that for a fact," he said.

[Oct 30, 2016] Clinton Foundation FBI Investigation Confirmed By Former Assistant FBI Director

Oct 30, 2016 | www.breitbart.com
Saturday on CNN while discussing the FBI reopening the investigation into Democratic presidential nominee Hillary Clinton's use of a private unsecured email server during her tenure as secretary of state, former Assistant Director of the FBI Thomas Fuentes said, "The FBI has an intensive investigation ongoing into the Clinton Foundation."

He added, "The FBI made the determination that the investigation would go forward as a comprehensive unified case and be coordinated, so that investigation is ongoing and Huma Abedin and her role and activities concerning secretary of state in the nature of the foundation and possible pay to play, that's still being looked at and now."

[Oct 29, 2016] Sharon Day Rescind your Clinton Endorsement

Notable quotes:
"... After weeks of revealing information behind the Clinton Foundation and their self-motivated fundraising tactics, there is no other word to describe the Democratic nominee for President of the United States. She's engaged in behavior that is disqualifying to be a candidate for the highest office, and yet dozens of American legislators, leaders and even media outlets have endorsed her candidacy. ..."
"... She's swindled countries out of donations, she's swindled corporate America with her lofty promises and she's swindled the American people – over and over and over again. ..."
"... So why now, after the knowledge that top-tier corporations and other wealthy supporters paid to meet with both the former president and the now Democratic presidential nominee should we believe that she would change her behavior to act in the best interest of the country? In fact, one could argue that this information is a window into how Clinton would rule the land. She'd have an eye out for only herself and her family, while leaving the American people - who so desperately want a change - with the same old Clinton-first approach. ..."
"... Beyond her blatant disregard for the American public, Clinton's cavalier approach to national security has come into question from a myriad of angles. From the secret server in her home basement that received hundreds of confidential email communications, to the lack of response she paid to the Congress when asked about the issue, to the suggestion that she made promises to the FBI that would cause them to "look the other way" when ruling on the secret email server. And then how about the millions of dollars the Clinton Foundation took from countries that are of disrepute, not to mention those that show little concern for women's rights. ..."
Oct 29, 2016 | www.breitbart.com
It was 25 years ago that Martin Scorsese delighted audiences with his movie rendition of the Jim Thompson novel, "The Grifters."

The story is an ingenious tale of deception and betrayal. By definition a grifter is someone who has made money dishonestly, in a swindle or a confidence game.

After weeks of revealing information behind the Clinton Foundation and their self-motivated fundraising tactics, there is no other word to describe the Democratic nominee for President of the United States. She's engaged in behavior that is disqualifying to be a candidate for the highest office, and yet dozens of American legislators, leaders and even media outlets have endorsed her candidacy.

She's swindled countries out of donations, she's swindled corporate America with her lofty promises and she's swindled the American people – over and over and over again.

So why now, after the knowledge that top-tier corporations and other wealthy supporters paid to meet with both the former president and the now Democratic presidential nominee should we believe that she would change her behavior to act in the best interest of the country? In fact, one could argue that this information is a window into how Clinton would rule the land. She'd have an eye out for only herself and her family, while leaving the American people - who so desperately want a change - with the same old Clinton-first approach.

Beyond her blatant disregard for the American public, Clinton's cavalier approach to national security has come into question from a myriad of angles. From the secret server in her home basement that received hundreds of confidential email communications, to the lack of response she paid to the Congress when asked about the issue, to the suggestion that she made promises to the FBI that would cause them to "look the other way" when ruling on the secret email server. And then how about the millions of dollars the Clinton Foundation took from countries that are of disrepute, not to mention those that show little concern for women's rights.

The most recent set of Clinton emails that have come to light are of such great concern to national security that the FBI has announced they will conduct a new investigation of Clinton's emails. This is just ELEVEN days before the country goes to the polls and decides on our next president.

Where has the leadership gone in this country? Since when do reputable news outlets stand behind candidates who have proven themselves over and over to be out for themselves and dangerous, even? It used to be that newspapers and legislators and leaders who speak from a platform would find themselves offering wisdom. Wisdom about which candidate was best for the job – based on the facts. Instead we find ourselves sifting through the list of endorsements for Clinton with little or no mention of her disregard for the law, her lack of concern for those she serves, and the careless nature in which she has proven herself to lead.

Now that the newspapers know better and have written about the truth in their own words, how can the media and elected officials stand by their decision to endorse her? They need to rescind their endorsement. That includes President Barack Obama and First Lady Michelle Obama.

In a quote from his book Thompson describes one of the characters, "Anyone who deprived her of something she wanted, deserved what he got."

Sounds all too familiar to the Democratic nominee for grifter-in-chief. If she's not changed by now, who is to say she'd be any different when she was the most powerful elected official in the United States. Once a grifter, always a grifter.

Sharon Day is the Republican National Committee Co-Chair.

[Oct 29, 2016] Hallelujah! here it guys! the internal Clinton Foundation attachment that connects the shady dots!

Notable quotes:
"... Wow, they clearly state Bill Clinton uses golfing to establish communication with donors ..."
"... "People with knowledge of the call in both camps said it was one of many that Clinton and Trump have had over the years, whether about golf or donations to the Clinton Foundation. But the call in May was considered especially sensitive, coming soon after Hillary Rodham Clinton had declared her own presidential run the month before." - source ..."
"... In total, The Wall Street Journal reports, two dozen companies and groups, plus the Abu Dhabi government, gave Bill more than $8 million for speeches, even as they were hoping for favorable treatment from Hillary's bureaucracy. And 15 of them also gave at least $5 million total to the foundation. ..."
"... Can someone help me see the shadiness, what am I missing? unless the "foundation donors require significant maintenance to keep them engaged and supportive of the foundation" means they are giving them political favors then it just looks like the clinton foundation is accepting donations and that is it. ..."
"... so pro-clinton sources have been propping up the Clinton Foundation for years as the pinnacle of charity while not really being able to explain where all the money goes; ..."
"... This shows that they require 20 million a year to operate with 8 employees. It shows they have to raid the Clinton Global Initiative for $6M to $11M every year to cover that budget hole... ..."
"... This is useful information that is probably not reflected on tax returns. Most importantly it shows that when Bill was offered a shady $8 million dollar over 2 year deal that would appear to be a conflict of interest while Hillary was Sect of State, Podesta and Band suggested hiding the money as payment for speeches. This boosts the accusation that the speeches are payments for quid pro quo. ..."
"... Does any of it contradict the MOU she signed when appointed Sec State? https://wikileaks.org/podesta-emails/emailid/34993 ..."
Oct 29, 2016 | www.reddit.com

Wow, they clearly state Bill Clinton uses golfing to establish communication with donors

beccairene 2 points 3 points 4 points 9 hours ago (1 child)

Wait, isn't golfing what Loretta Lynch claimed to have discussed with WJC on the plane?

robaloie 2 points 3 points 4 points 8 hours ago * (0 children)

He also said they were talking about golf when he called Donald trump last year before trump decided to run.

"People with knowledge of the call in both camps said it was one of many that Clinton and Trump have had over the years, whether about golf or donations to the Clinton Foundation. But the call in May was considered especially sensitive, coming soon after Hillary Rodham Clinton had declared her own presidential run the month before." - source

Not_a_Fake 8 points 9 points 10 points 18 hours ago (0 children)

Question-Are we to assume that any OTHER speaking engagements that WJC did were not because of the foundation, but from when his wife was SOS?

In total, The Wall Street Journal reports, two dozen companies and groups, plus the Abu Dhabi government, gave Bill more than $8 million for speeches, even as they were hoping for favorable treatment from Hillary's bureaucracy. And 15 of them also gave at least $5 million total to the foundation.

soupy_scoopy 113 points 114 points 115 points 1 day ago (4 children)

Has this been cleared by CNN for me to view?

BigLizardz 2 points 3 points 4 points 19 hours ago (0 children)

Lol I'm actually too scared to click in wikileak/dikileak links. #1984?

OldDirtyPlastered 14 points 15 points 16 points 22 hours ago (0 children)

Good question. I don't want to do anything illegal.

Uncle_Touchy_ 17 points 18 points 19 points 1 day ago (0 children)

You'll have to ask Downy McDaterape or whatever that anchor's name is. You know the one.

moreoverhereafter 4 points 5 points 6 points 1 day ago * (5 children)

Can someone help me see the shadiness, what am I missing? unless the "foundation donors require significant maintenance to keep them engaged and supportive of the foundation" means they are giving them political favors then it just looks like the clinton foundation is accepting donations and that is it.

5pointlight [ S ] 81 points 82 points 83 points 1 day ago * (4 children)

so pro-clinton sources have been propping up the Clinton Foundation for years as the pinnacle of charity while not really being able to explain where all the money goes; because it sure doesn't seem to be going to Haiti or many other charities.

This shows that they require 20 million a year to operate with 8 employees. It shows they have to raid the Clinton Global Initiative for $6M to $11M every year to cover that budget hole... so this gives credence to the suspicion that the CF is hiding money somewhere (laundering money to Clintons and friends). Also this document shows how teneo made Bill Clinton " more than $50 million in for-profit activity we have personally helped to secure for President Clinton to date or the $66 million in future contracts" as of 2011.

This is useful information that is probably not reflected on tax returns. Most importantly it shows that when Bill was offered a shady $8 million dollar over 2 year deal that would appear to be a conflict of interest while Hillary was Sect of State, Podesta and Band suggested hiding the money as payment for speeches. This boosts the accusation that the speeches are payments for quid pro quo.

Fake_Unicron comment score below threshold -12 points -11 points -10 points 16 hours ago (0 children)

Any sources on that, like the foundation spending?

How have you compared their spending reports to those from other charities?

In contrast to your unsourced allegations:

https://www.charitynavigator.org/index.cfm?bay=content.view&cpid=2284

How would the charity donations allow the CF to launder money for the donors? Any evidence or is this just guesswork auditing?

Why do you think this is "probably not reflected on tax returns"?

driusan 10 points 11 points 12 points 23 hours ago (0 children)

Does any of it contradict the MOU she signed when appointed Sec State? https://wikileaks.org/podesta-emails/emailid/34993

[Oct 25, 2016] The Clinton Foundation contributed to the February coup in Ukraine, having longstanding ties to Ukrainian oligarchs who pushed the country to European integration.

Notable quotes:
"... It has recently turned out that Ukrainian oligarch Viktor Pinchuk, a vocal proponent of Ukraine's European integration, made huge contributions to the Clinton Foundation, while Hillary Clinton was the US Secretary of State. Although the foundation swore off donations from foreign governments while Mrs. Clinton was serving as a state official, it continued accepting money from private donors. Many of them had certain ties to their national governments like Viktor Pinchuk, a Ukrainian businessman and ex-parliamentarian. ..."
"... Viktor Pinchuk has always been one of the most vocal proponents of Ukraine's European integration. In 2004 Pinchuk founded the Yalta European Strategy (YES) platform in Kiev. YES is led by the board including ex-president of Poland Aleksander Kwasniewski and former NATO Secretary General Javier Solana. According to the website of the platform, Bill Clinton, Hillary Clinton, Condoleezza Rice, Kofi Annan, Radoslaw Sikorski, Vitaliy Klitschko, Arseniy Yatsenyuk, Petro Poroshenko and other prominent figures have participated in annual meetings of YES since 2004. ..."
"... Experts note that after the coup, the Ukrainian leadership has actually become Washington's puppet government. Several foreign citizens, including American civilian Natalie Jaresko, Lithuanian investment banker Aivaras Abromavicius and Georgia-born Alexander Kvitashvili have assumed high posts in the Ukrainian government. It should be noted that Natalie Jaresko, Ukraine's Financial Minister, have previously worked in the US State Department and has also been linked to oligarch Viktor Pinchuk. ..."
May 17, 2015 | sputniknews.com

A sinister atmosphere surrounds the Clinton Foundation's role in Ukrainian military coup of February 2014, experts point out.

It has recently turned out that Ukrainian oligarch Viktor Pinchuk, a vocal proponent of Ukraine's European integration, made huge contributions to the Clinton Foundation, while Hillary Clinton was the US Secretary of State. Although the foundation swore off donations from foreign governments while Mrs. Clinton was serving as a state official, it continued accepting money from private donors. Many of them had certain ties to their national governments like Viktor Pinchuk, a Ukrainian businessman and ex-parliamentarian.

Remarkably, among individual donors contributing to the Clinton Foundation in the period between 1999 and 2014, Ukrainian sponsors took first place in the list, providing the charity with almost $10 million and pushing England and Saudi Arabia to second and third places respectively.

It is worth mentioning that the Viktor Pinchuk Foundation alone transferred at least $8.6 million to the Clinton charity between 2009 and 2013. Pinchuk, who acquired his fortune from a pipe-making business, served twice as a parliamentarian in Ukraine's Verkhovna Rada and was married to the daughter of ex-president of Ukraine Leonid Kuchma.

Although the Clinton's charity denies that the donations were somehow connected with political matters, experts doubt that international private sponsors received no political support in return. In 2008 Pinchuk pledged to make a five-year $29 million contribution to the Clinton Global Initiative in order to fund a program aimed at training future Ukrainian leaders and "modernizers." Remarkably, several alumni of these courses are current members of Ukrainian parliament. Because of the global financial crisis, the Pinchuk Foundation sent only $1.8 million.

Experts note that during Mrs. Clinton's tenure as Secretary of State, Viktor Pinchuk was introduced to some influential American lobbyists. Curiously enough, he tried to use his powerful "friends" to pressure Ukraine's then-President Viktor Yanukovych to free Yulia Tymoshenko, who served a jail term.

Viktor Pinchuk has always been one of the most vocal proponents of Ukraine's European integration. In 2004 Pinchuk founded the Yalta European Strategy (YES) platform in Kiev. YES is led by the board including ex-president of Poland Aleksander Kwasniewski and former NATO Secretary General Javier Solana. According to the website of the platform, Bill Clinton, Hillary Clinton, Condoleezza Rice, Kofi Annan, Radoslaw Sikorski, Vitaliy Klitschko, Arseniy Yatsenyuk, Petro Poroshenko and other prominent figures have participated in annual meetings of YES since 2004.

No one would argue that proponents of Ukraine's pro-Western course played the main role in organizing the coup of February 2014 in Kiev. Furthermore, the exceptional role of the United States in ousting then-president Viktor Yanukovich has also been recognized by political analysts, participants of Euromaidan and even by Barack Obama, the US President.

Experts note that after the coup, the Ukrainian leadership has actually become Washington's puppet government. Several foreign citizens, including American civilian Natalie Jaresko, Lithuanian investment banker Aivaras Abromavicius and Georgia-born Alexander Kvitashvili have assumed high posts in the Ukrainian government. It should be noted that Natalie Jaresko, Ukraine's Financial Minister, have previously worked in the US State Department and has also been linked to oligarch Viktor Pinchuk.

So far, experts note, the recent "game of thrones" in Ukraine has been apparently instigated by a few powerful clans of the US and Ukraine, who are evidently benefitting from the ongoing turmoil. In this light the Clinton Foundation looks like something more than just a charity: in today's world of fraudulent oligopoly we are facing with global cronyism, experts point out, warning against its devastating consequences.

Read more: http://sputniknews.com/analysis/20150323/1019905665.html#ixzz3YT3FykcI

See also: US Intelligence Services Behind 2014 Ukraine Coup – EU Parliament Member

[Oct 24, 2016] Qatar, like most Muslim countries, treats women as second-class citizens, but champion-of-women Hillary never lets a little thing like that stop her from doing business

nypost.com

Qatar, like most Muslim countries, treats women as second-class citizens, but champion-of-women Hillary never lets a little thing like that stop her from doing business. (See: "On favors.") And a far greater threat than murderous Muslims adhering to a fanatical 7th-century religious ideology lurks right here at home - those pesky Roman Catholics and their silly 2,000-year-old faith. (See: "On Catholics.")

[Oct 23, 2016] Clintonism is wedge politics directed against any class or populist upheaval that might threaten neoliberalism

That's explains vicious campaign by neoliberal MSM against Trump and swiping under the carpet all criminal deeds of Clinton family. They feel the threat...
Notable quotes:
"... It should be remembered that fascism does not succeed in the real world as a crusade by race-obsessed lumpen. It succeeds when fascists are co-opted by capitalists, as was unambiguously the case in Nazi Germany and Italy. And big business supported fascism because it feared the alternatives: socialism and communism. ..."
"... That's because there is no more effective counter to class consciousness than race consciousness. That's one reason why, in my opinion, socialism hasn't done a better job of catching on in the United States. The contradictions between black and white labor formed a ready-made wedge. ..."
Oct 23, 2016 | www.nakedcapitalism.com

An excellent article

It should be remembered that fascism does not succeed in the real world as a crusade by race-obsessed lumpen. It succeeds when fascists are co-opted by capitalists, as was unambiguously the case in Nazi Germany and Italy. And big business supported fascism because it feared the alternatives: socialism and communism.

That's because there is no more effective counter to class consciousness than race consciousness. That's one reason why, in my opinion, socialism hasn't done a better job of catching on in the United States. The contradictions between black and white labor formed a ready-made wedge. The North's abhorrence at the spread of slavery into the American West before the Civil War had more to do a desire to preserve these new realms for "free" labor-"free" in one context, from the competition of slave labor-than egalitarian principle.[…]

There is more to Clintonism, I think, than simply playing the "identity politics" card to screw Bernie Sanders or discombobulate the Trump campaign. "Identity politics" is near the core of the Clintonian agenda as a bulwark against any class/populist upheaval that might threaten her brand of billionaire-friendly liberalism.

In other words it's all part of a grand plan when the Clintonoids aren't busy debating the finer points of her marketing and "mark"–a term normally applied to the graphic logo on a commercial product.

http://www.unz.com/plee/trump-we-wish-the-problem-was-fascism/

[Oct 22, 2016] payments for some of Bill and Hillary's activities (non-speech related and easier to hide), ie lobbying for foreign governments and corporations, were structured through holding companies in Singapore, Hong Kong

Oct 22, 2016 | www.nakedcapitalism.com

Cry Shop October 22, 2016 at 4:10 am

Bill Clinton has a mysterious shell-company

Trump could not be the only candidate under reporting family income. It's been pretty common talk among the chambers of commerce in Asia that payments for some of Bill and Hillary's activities (non-speech related and easier to hide), ie lobbying for foreign governments and corporations, were structured through holding companies in Singapore, Hong Kong, etc. http://www.nakedcapitalism.com/2016/03/bill-black-the-clintons-have-not-changed-the-clintonian-war-on-the-ig-watchdogs.html

Certainly having a on-shore tax shell is an important part of repatriation, just in time for Hillary's promised tax holiday.
https://newrepublic.com/article/117763/clinton-proposes-repatriation-tax-holiday-fund-infrastructure-bank

[Oct 21, 2016] The capitalist crisis and the radicalization of the working class in 2012 - World Socialist Web Site by David North

Its from World Socialist Web Site by thier analysys does contain some valid points. Especially about betrayal of nomenklatura, and, especially, KGB nomenklatura,which was wholesale bought by the USA for cash.
Note that the author is unable or unwilling to use the tterm "neoliberalism". Looks like orthodox Marxism has problem with this notion as it contradict Marxism dogma that capitalism as an economic doctrine is final stage before arrival of socialism. Looks like it is not the final ;-)
Notable quotes:
"... Russia Since 1980 ..."
"... History reveals that the grandsons of the Bolshevik coup d'état didn't destroy the Soviet Union in a valiant effort to advance the cause of communist prosperity or even to return to their common European home; instead, it transformed Soviet managers and ministers into roving bandits (asset-grabbing privateers) with a tacit presidential charter to privatize the people's assets and revenues to themselves under the new Muscovite rule of men ..."
"... The scale of this plunder was astounding. It not only bankrupted the Soviet Union, forcing Russian President Boris Yeltsin to appeal to the G-7 for $6 billion of assistance on December 6, 1991, but triggered a free fall in aggregate production commencing in 1990, aptly known as catastroika. ..."
"... In retrospect, the Soviet economy didn't collapse because the liberalized command economy devised after 1953 was marked for death. The system was inefficient, corrupt and reprehensible in a myriad of ways, but sustainable, as the CIA and most Sovietologists maintained. It was destroyed by Gorbachev's tolerance and complicity in allowing privateers to misappropriate state revenues, pilfer materials, spontaneously privatize, and hotwire their ill-gotten gains abroad, all of which disorganized production. ..."
"... The rapid growth and increasing complexity of the Soviet economy required access to the resources of the world economy. ..."
"... For the Soviet bureaucracy, a parasitic social caste committed to the defense of its privileges and terrified of the working class, the revolutionary solution to the contradictions of the Soviet economy was absolutely unthinkable. The only course that it could contemplate was the second-capitulation to imperialism. ..."
"... In other words, the integration of the USSR into the structure of the world capitalist economy on a capitalist basis means not the slow development of a backward national economy, but the rapid destruction of one which has sustained living conditions which are, at least for the working class, far closer to those that exist in the advanced countries than in the third world. ..."
"... The Fourth International ..."
"... The End of the USSR, ..."
"... The report related the destruction of the USSR by the ruling bureaucracy to a broader international phenomenon. The smashing up of the USSR was mirrored in the United States by the destruction of the trade unions as even partial instruments of working-class defense. ..."
"... Millions of people are going to see imperialism for what it really is. The democratic mask is going to be torn off. The idea that imperialism is compatible with peace is going to be exposed. The very elements which drove masses into revolutionary struggle in the past are once again present. The workers of Russia and the Ukraine are going to be reminded why they made a revolution in the first place. The American workers are going to be reminded why they themselves in an earlier period engaged in the most massive struggles against the corporations. The workers of Europe are going to be reminded why their continent was the birthplace of socialism and Karl Marx. [p. 25] ..."
Jan 30, 2012 | www.wsws.org

... ... ...

This analysis has been vindicated by scholarly investigations into the causes of the Soviet economic collapse that facilitated the bureaucracy's dissolution of the USSR. In Russia Since 1980, published in 2008 by Cambridge University Press, Professors Steven Rosefielde and Stefan Hedlund present evidence that Gorbachev introduced measures that appear, in retrospect, to have been aimed at sabotaging the Soviet economy. "Gorbachev and his entourage," they write, "seem to have had a venal hidden agenda that caused things to get out of hand quickly." [p. 38] In a devastating appraisal of Gorbachev's policies, Rosefielde and Hedlund state:

History reveals that the grandsons of the Bolshevik coup d'état didn't destroy the Soviet Union in a valiant effort to advance the cause of communist prosperity or even to return to their common European home; instead, it transformed Soviet managers and ministers into roving bandits (asset-grabbing privateers) with a tacit presidential charter to privatize the people's assets and revenues to themselves under the new Muscovite rule of men. [p. 40]

Instead of displaying due diligence over personal use of state revenues, materials and property, inculcated in every Bolshevik since 1917, Gorbachev winked at a counterrevolution from below opening Pandora's Box. He allowed enterprises and others not only to profit maximize for the state in various ways, which was beneficial, but also to misappropriate state assets, and export the proceeds abroad. In the process, red directors disregarded state contracts and obligations, disorganizing inter-industrial intermediate input flows, and triggering a depression from which the Soviet Union never recovered and Russia has barely emerged. [p. 47]

Given all the heated debates that would later ensue about how Yeltsin and his shock therapy engendered mass plunder, it should be noted that the looting began under Gorbachev's watch. It was his malign neglect that transformed the rhetoric of Market Communism into the pillage of the nation's assets.

The scale of this plunder was astounding. It not only bankrupted the Soviet Union, forcing Russian President Boris Yeltsin to appeal to the G-7 for $6 billion of assistance on December 6, 1991, but triggered a free fall in aggregate production commencing in 1990, aptly known as catastroika.

In retrospect, the Soviet economy didn't collapse because the liberalized command economy devised after 1953 was marked for death. The system was inefficient, corrupt and reprehensible in a myriad of ways, but sustainable, as the CIA and most Sovietologists maintained. It was destroyed by Gorbachev's tolerance and complicity in allowing privateers to misappropriate state revenues, pilfer materials, spontaneously privatize, and hotwire their ill-gotten gains abroad, all of which disorganized production. [p. 49]

The analysis of Rosefielde and Hedlund, while accurate in its assessment of Gorbachev's actions, is simplistic. Gorbachev's policies can be understood only within the framework of more fundamental political and socioeconomic factors. First, and most important, the real objective crisis of the Soviet economy (which existed and preceded by many decades the accession of Gorbachev to power) developed out of the contradictions of the autarkic nationalist policies pursued by the Soviet regime since Stalin and Bukharin introduced the program of "socialism in one country" in 1924. The rapid growth and increasing complexity of the Soviet economy required access to the resources of the world economy. This access could be achieved only in one of two ways: either through the spread of socialist revolution into the advanced capitalist countries, or through the counterrevolutionary integration of the USSR into the economic structures of world capitalism.

For the Soviet bureaucracy, a parasitic social caste committed to the defense of its privileges and terrified of the working class, the revolutionary solution to the contradictions of the Soviet economy was absolutely unthinkable. The only course that it could contemplate was the second-capitulation to imperialism. This second course, moreover, opened for the leading sections of the bureaucracy the possibility of permanently securing their privileges and vastly expanding their wealth. The privileged caste would become a ruling class. The corruption of Gorbachev, Yeltsin and their associates was merely the necessary means employed by the bureaucracy to achieve this utterly reactionary and immensely destructive outcome.

On October 3, 1991, less than three months before the dissolution of the USSR, I delivered a lecture in Kiev in which I challenged the argument-which was widely propagated by the Stalinist regime-that the restoration of capitalism would bring immense benefits to the people. I stated:

In this country, capitalist restoration can only take place on the basis of the widespread destruction of the already existing productive forces and the social- cultural institutions that depended upon them. In other words, the integration of the USSR into the structure of the world capitalist economy on a capitalist basis means not the slow development of a backward national economy, but the rapid destruction of one which has sustained living conditions which are, at least for the working class, far closer to those that exist in the advanced countries than in the third world. When one examines the various schemes hatched by proponents of capitalist restoration, one cannot but conclude that they are no less ignorant than Stalin of the real workings of the world capitalist economy. And they are preparing the ground for a social tragedy that will eclipse that produced by the pragmatic and nationalistic policies of Stalin. ["Soviet Union at the Crossroads," published in The Fourth International (Fall- Winter 1992, Volume 19, No. 1, p. 109), Emphasis in the original.]

Almost exactly 20 years ago, on January 4, 1992, the Workers League held a party membership meeting in Detroit to consider the historical, political and social implications of the dissolution of the USSR. Rereading this report so many years later, I believe that it has stood the test of time. It stated that the dissolution of the USSR "represents the juridical liquidation of the workers' state and its replacement with regimes that are openly and unequivocally devoted to the destruction of the remnants of the national economy and the planning system that issued from the October Revolution. To define the CIS [Confederation of Independent States] or its independent republics as workers states would be to completely separate the definition from the concrete content which it expressed during the previous period." [David North, The End of the USSR, Labor Publications, 1992, p. 6]

The report continued:

"A revolutionary party must face reality and state what is. The Soviet working class has suffered a serious defeat. The bureaucracy has devoured the workers state before the working class was able to clean out the bureaucracy. This fact, however unpleasant, does not refute the perspective of the Fourth International. Since it was founded in 1938, our movement has repeatedly said that if the working class was not able to destroy this bureaucracy, then the Soviet Union would suffer a shipwreck. Trotsky did not call for political revolution as some sort of exaggerated response to this or that act of bureaucratic malfeasance. He said that a political revolution was necessary because only in that way could the Soviet Union, as a workers state, be defended against imperialism." [p. 6]

I sought to explain why the Soviet working class had failed to rise up in opposition to the bureaucracy's liquidation of the Soviet Union. How was it possible that the destruction of the Soviet Union-having survived the horrors of the Nazi invasion-could be carried out "by a miserable group of petty gangsters, acting in the interests of the scum of Soviet society?" I offered the following answer:

We must reply to these questions by stressing the implications of the massive destruction of revolutionary cadre carried out within the Soviet Union by the Stalinist regime. Virtually all the human representatives of the revolutionary tradition who consciously prepared and led that revolution were wiped out. And along with the political leaders of the revolution, the most creative representatives of the intelligentsia who had flourished in the early years of the Soviet state were also annihilated or terrorized into silence.

Furthermore, we must point to the deep-going alienation of the working class itself from state property. Property belonged to the state, but the state "belonged" to the bureaucracy, as Trotsky noted. The fundamental distinction between state property and bourgeois property-however important from a theoretical standpoint-became less and less relevant from a practical standpoint. It is true that capitalist exploitation did not exist in the scientific sense of the term, but that did not alter the fact that the day-to-day conditions of life in factories and mines and other workplaces were as miserable as are to be found in any of the advanced capitalist countries, and, in many cases, far worse.

Finally, we must consider the consequences of the protracted decay of the international socialist movement...

Especially during the past decade, the collapse of effective working class resistance in any part of the world to the bourgeois offensive had a demoralizing effect on Soviet workers. Capitalism assumed an aura of "invincibility," although this aura was merely the illusory reflection of the spinelessness of the labor bureaucracies all over the world, which have on every occasion betrayed the workers and capitulated to the bourgeoisie. What the Soviet workers saw was not the bitter resistance of sections of workers to the international offensive of capital, but defeats and their consequences. [p. 13-14]

The report related the destruction of the USSR by the ruling bureaucracy to a broader international phenomenon. The smashing up of the USSR was mirrored in the United States by the destruction of the trade unions as even partial instruments of working-class defense.

In every part of the world, including the advanced countries, the workers are discovering that their own parties and their own trade union organizations are engaged in the related task of systematically lowering and impoverishing the working class. [p. 22]

Finally, the report dismissed any notion that the dissolution of the USSR signified a new era of progressive capitalist development.

Millions of people are going to see imperialism for what it really is. The democratic mask is going to be torn off. The idea that imperialism is compatible with peace is going to be exposed. The very elements which drove masses into revolutionary struggle in the past are once again present. The workers of Russia and the Ukraine are going to be reminded why they made a revolution in the first place. The American workers are going to be reminded why they themselves in an earlier period engaged in the most massive struggles against the corporations. The workers of Europe are going to be reminded why their continent was the birthplace of socialism and Karl Marx. [p. 25]

The aftermath of the dissolution of the USSR: 20 years of economic crisis, social decay, and political reaction

According to liberal theory, the dissolution of the Soviet Union ought to have produced a new flowering of democracy. Of course, nothing of the sort occurred-not in the former USSR or, for that matter, in the United States. Moreover, the breakup of the Soviet Union-the so-called defeat of communism-was not followed by a triumphant resurgence of its irreconcilable enemies in the international workers' movement, the social democratic and reformist trade unions and political parties. The opposite occurred. All these organizations experienced, in the aftermath of the breakup of the USSR, a devastating and even terminal crisis. In the United States, the trade union movement-whose principal preoccupation during the entire Cold War had been the defeat of Communism-has all but collapsed. During the two decades that followed the collapse of the Soviet Union, the AFL-CIO lost a substantial portion of its membership, was reduced to a state of utter impotence, and ceased to exist as a workers' organization in any socially significant sense of the term. At the same time, everywhere in the world, the social position of the working class-from the standpoint of its influence on the direction of state policy and its ability to increase its share of the surplus value produced by its own labor-deteriorated dramatically.

Certain important conclusions flow from this fact. First, the breakup of the Soviet Union did not flow from the supposed failure of Marxism and socialism. If that had been the case, the anti-Marxist and antisocialist labor organizations should have thrived in the post-Soviet era. The fact that these organizations experienced ignominious failure compels one to uncover the common feature in the program and orientation of all the so-called labor organizations, "communist" and anticommunist alike. What was the common element in the political DNA of all these organization? The answer is that regardless of their names, conflicting political alignments and superficial ideological differences, the large labor organizations of the post-World War II period pursued essentially nationalist policies. They tied the fate of the working class to one or another nation-state. This left them incapable of responding to the increasing integration of the world economy. The emergence of transnational corporations and the associated phenomena of capitalist globalization shattered all labor organizations that based themselves on a nationalist program.

The second conclusion is that the improvement of conditions of the international working class was linked, to one degree or another, to the existence of the Soviet Union. Despite the treachery and crimes of the Stalinist bureaucracy, the existence of the USSR, a state that arose on the basis of a socialist revolution, imposed upon American and European imperialism certain political and social restraints that would otherwise have been unacceptable. The political environment of the past two decades-characterized by unrestrained imperialist militarism, the violations of international law, and the repudiation of essential principles of bourgeois democracy-is the direct outcome of the dissolution of the Soviet Union.

The breakup of the USSR was, for the great masses of its former citizens, an unmitigated disaster. Twenty years after the October Revolution, despite all the political crimes of the Stalinist regime, the new property relations established in the aftermath of the October Revolution made possible an extraordinary social transformation of backward Russia. And even after suffering horrifying losses during the four years of war with Nazi Germany, the Soviet Union experienced in the 20 years that followed the war a stupendous growth of its economy, which was accompanied by advances in science and culture that astonished the entire world.

But what is the verdict on the post-Soviet experience of the Russian people? First and foremost, the dissolution of the USSR set into motion a demographic catastrophe. Ten years after the breakup of the Soviet Union, the Russian population was shrinking at an annual rate of 750,000. Between 1983 and 2001, the number of annual births dropped by one half. 75 percent of pregnant women in Russia suffered some form of illness that endangered their unborn child. Only one quarter of infants were born healthy.

The overall health of the Russian people deteriorated dramatically after the restoration of capitalism. There was a staggering rise in alcoholism, heart disease, cancer and sexually transmitted diseases. All this occurred against the backdrop of a catastrophic breakdown of the economy of the former USSR and a dramatic rise in mass poverty.

As for democracy, the post-Soviet system was consolidated on the basis of mass murder. For more than 70 years, the Bolshevik regime's dissolution of the Constituent Assembly in January 1918-an event that did not entail the loss of a single life-was trumpeted as an unforgettable and unforgivable violation of democratic principles. But in October 1993, having lost a majority in the popularly elected parliament, the Yeltsin regime ordered the bombardment of the White House-the seat of the Russian parliament-located in the middle of Moscow. Estimates of the number of people who were killed in the military assault run as high as 2,000. On the basis of this carnage, the Yeltsin regime was effectively transformed into a dictatorship, based on the military and security forces. The regime of Putin-Medvedev continues along the same dictatorial lines. The assault on the White House was supported by the Clinton administration. Unlike the dissolution of the Constituent Assembly, the bombardment of the Russian parliament is an event that has been all but forgotten.

What is there to be said of post-Soviet Russian culture? As always, there are talented people who do their best to produce serious work. But the general picture is one of desolation. The words that have emerged from the breakup of the USSR and that define modern Russian culture, or what is left of it, are "mafia," "biznessman" and "oligarch."

What has occurred in Russia is only an extreme expression of a social and cultural breakdown that is to be observed in all capitalist countries. Can it even be said with certainty that the economic system devised in Russia is more corrupt that that which exists in Britain or the United States? The Russian oligarchs are probably cruder and more vulgar in the methods they employ. However, the argument could be plausibly made that their methods of plunder are less efficient than those employed by their counterparts in the summits of American finance. After all, the American financial oligarchs, whose speculative operations brought about the near-collapse of the US and global economy in the autumn of 2008, were able to orchestrate, within a matter of days, the transfer of the full burden of their losses to the public.

It is undoubtedly true that the dissolution of the USSR at the end of 1991 opened up endless opportunities for the use of American power-in the Balkans, the Middle East and Central Asia. But the eruption of American militarism was, in the final analysis, the expression of a more profound and historically significant tendency-the long-term decline of the economic position of American capitalism. This tendency was not reversed by the breakup of the USSR. The history of American capitalism during the past two decades has been one of decay. The brief episodes of economic growth have been based on reckless and unsustainable speculation. The Clinton boom of the 1990s was fueled by the "irrational exuberance" of Wall Street speculation, the so-called dot.com bubble. The great corporate icons of the decade-of which Enron was the shining symbol-were assigned staggering valuations on the basis of thoroughly criminal operations. It all collapsed in 2000-2001. The subsequent revival was fueled by frenzied speculation in housing. And, finally, the collapse in 2008, from which there has been no recovery.

When historians begin to recover from their intellectual stupor, they will see the collapse of the USSR and the protracted decline of American capitalism as interrelated episodes of a global crisis, arising from the inability to develop the massive productive forces developed by mankind on the basis of private ownership of the means of production and within the framework of the nation-state system.

[Oct 13, 2016] The Clintons sure were working the Haiti angle any way that they could. I wonder how that's playing in Florida?

Notable quotes:
"... [Qatar] would like to see WJC 'for five minutes' in NYC, to present $1 million check that Qatar promised for WJC's birthday in 2011," an employee at The Clinton Foundation said to numerous aides, including Doug Brand ..."
"... No doubt! The Clintons sure were working the Haiti angle any way that they could. I wonder how that's playing in Florida? ..."
Oct 13, 2016 | www.washingtontimes.com

"[Qatar] would like to see WJC 'for five minutes' in NYC, to present $1 million check that Qatar promised for WJC's birthday in 2011," an employee at The Clinton Foundation said to numerous aides, including Doug Brand [isc]. "Qatar would welcome our suggestions for investments in Haiti - particularly on education and health. They have allocated most of their $20 million but are happy to consider projects we suggest. I'm collecting input from CF Haiti team."

No doubt! The Clintons sure were working the Haiti angle any way that they could. I wonder how that's playing in Florida?

[Oct 13, 2016] Donald Trump Is Accusing the Clintons of Cashing In on Haiti's 2010 Earthquake

That should have been done long ago.
fortune.com

Donald Trump is accusing the Clintons of cashing in on Haiti's deadly 2010 earthquake.

The Republican nominee cited State Department emails obtained by the Republican National Committee through a public records request and detailed in an ABC News story.

At issue is whether friends of former President Bill Clinton, referred to as "friends of Bill," or "FOB," in the emails, received preferential treatment or contracts from the State Department in the immediate aftermath of the 7.0-magnitude earthquake on Jan. 12, 2010. More than 230,000 people died, the U.S. has said.

[Sep 28, 2016] Who Cares About the Clinton Foundation?

Sep 28, 2016 | baselinescenario.com
by James Kwak Posted on August 25, 2016 The Baseline Scenario | 59 comments By James Kwak

Imagine that while George W. Bush was governor of Texas and president of the United States, various people and companies decided to write him checks for hundreds of thousands of dollars, just because they thought he was a great guy. Those people and companies, just coincidentally, happened to have interests that were affected by the policies of Texas and the United States. But when he thanked them for their money, Bush never promised to do anything in particular for them. You would be suspicious, right?

Now, that's roughly what has been happening with the Clinton Foundation. Various people and companies have been writing checks for millions of dollars to the Foundation during the same time that Hillary Clinton was secretary of state and, following that, the most likely next president of the United States-a title she has held since the day Barack Obama's second term began. (The Clintons finally decided to scale back the Foundation earlier this week.)

... ... ...

So the real question is this: Do you think it would be appropriate for people and companies affected by U.S. policy to be writing $1 million checks directly to the Clintons? If the answer is yes, then you should be against any campaign finance rules whatsoever. If the answer is no, you should be worried about the Clinton Foundation.

  1. Vinny Idol | August 25, 2016 at 8:02 pm | I disagree whole heartedly with this post. The clinton foundation is a big deal, because its proof positive that America was founded on Money laundering, the elite that run this country make and made their money through money laundering; and no one wants that in the White House. Thats ok for the rest of America sociery, but not the government where peoples lives hang on the balance through every speech, law and policy that is conducted on capitol hill.

    The Clintons destroyed Libya, Honduras, Haiti through their money laundering scheme called the clinton foundation. Theres no justification for that.

  1. Ray LaPan-Love | August 26, 2016 at 12:40 am | Trump thinks very highly of Reagan, but very lowly of Mexicans, so if Trump were to win I suspect he will secretly sell some of our nukes, this finally giving him the financial boost needed to overtake Carlos Slim on the list of the world's richest men. This 'deal of deals' then also harkens back to another historical 'deal' (Iran/Contra), and of course Reagan, while simultaneously eliminating Trump's deepest regret which is that of being bested by a Mexican. This being the real reason that he decided to run in the first place.

    Probably though, HRC will win. The problem there being that all of the scrutiny that she has been receiving for so long, coupled with Bills' infidelities, and other various setbacks and slights, have left her very angry and bitter. Combining this seething hatred of all humans, especially men, with the fact that there has never been a women president to look up to, HRC's only influence is a secretary who worked for Woodrow Wilson by the name of Mildred Jingowitz, or Ms. Jingo as she was called. Ms. Jingo stands out for HRC because she actually wrote the Espionage Act of 1917 and the the Sedition Act of 1918. Those combining to "cover a broader range of offenses, notably speech and the expression of opinion that cast the government or the war effort in a negative light or interfered with the sale of government bonds."
    "The Sedition Act of 1918 stated that people or countries cannot say negative things about the government or the war."
    "It forbade the use of "disloyal, profane, scurrilous, or abusive language" about the United States government, its flag, or its armed forces or that caused others to view the American government or its institutions with contempt." Most importantly though, these acts gave the Government the legal right to prosecute draft dodgers, and …these could bring an end to at least some of the scrutiny that has plagued HRC for so long just so long as we remain at war.
    So, if you are wondering what any of this has to do with the Clinton Foundation, well, HRC used the Foundation to facilitate at least one very large arms deal with at least one Royal Gulfie. But it matters little whether she used the foundation or not, HRC used her tenure at Foggy Bottom to arrange a record number of weapons deals, and of course she is mad as hell and determined to prove just how tough women can be (and there is of course one man who she respects, H. Kissinger).

    Anyway, it doesn't take a historian specializing in the build-up leading to the two World Wars to figure out the rest. BOOM!!!

  2. Philip Diehl | August 26, 2016 at 12:46 am | Dear James,

    I'm a long-time reader. I admire what you and Simon have done educating us about the financial crisis and its aftermath, and I agree with most of your political positions, especially related to the corrupting influence of money in politics. I have seen this first hand over my years in politics and government, and I believe it is the single most important issue we face because progress on all others depends on it.

    But in taking yet another hack at Hillary Clinton in this post, you've contradicted yourself in a way that unravels your argument, while engaging in false equivalencies and blowing a key fact out of proportion. First, the internal contradiction:

    "Bill and Hillary are getting on in years, they only have one child, and she is married to a hedge fund manager. When you have that much money, a dollar in your foundation is as good as a dollar in your bank account. Once you have all your consumption needs covered, what do you need money for?"

    You imply, here, that the Clintons' wealth and Marc Mezvinsky's hedge fund income have made the marginal value of another dollar in income de minimis for the Clintons' personal finances. Then you write, paraphrasing, that a dollar donated to the Foundation is as good as a dollar deposited in their personal bank account; therefore, you imply, money that goes to their foundation is as corrupting as money that goes into their personal accounts.

    You see the problem in claiming that a contribution to the Clinton Foundation is a powerful incentive for HRC to tilt her foreign policy positions, right? You just made the case for why a donation to the Foundation has little personal value to the Clintons:

    MV of $ to bank account = 0.
    MV of $ to Foundation = MV of $ to bank account.
    But you don't proceed to: Therefore, MV of $ to Foundation = 0. So, according to your logic, there can be no corrupting influence.

    You follow this, writing:

    "If you're a Clinton, you want to have an impact in the world, reward your friends, and burnish your legacy. A foundation is an excellent vehicle for all of those purposes, for obvious reasons. It is also an excellent way to transfer money to your daughter free of estate tax, since she can control it after you die."

    Your imply that the Clintons give equal weight to their desires to reward their friends, burnish their legacy, and have an impact on the world. What evidence do you have of this? Also, you implicitly denigrate their charitable motives by describing them as a desire "to have an impact on the world" without a nod to their clear intent to have an impact that is profoundly constructive. You also speculate, without providing any support, that the Foundation is a tax avoidance scheme to enrich their daughter. I think you've crossed a line here.

    Now for the false equivalencies:

    "Imagine that while George W. Bush was governor of Texas and president of the United States, various people and companies decided to write him checks for hundreds of thousands of dollars, just because they thought he was a great guy. Those people and companies, just coincidentally, happened to have interests that were affected by the policies of Texas and the United States. But when he thanked them for their money, Bush never promised to do anything in particular for them. You would be suspicious, right?"

    Why imagine? We have the real-world case of the Saudis bailing out George W's Harken Energy while his father was president. Of course, this is only one example of how the lucrative Bush-Saudi relationship generated income that went straight into the Bush "coffers".

    So you implicitly compare HRC's alleged conflict related to the family's charity with the Bush family conflict related to their own personal bank accounts. While HW Bush, as president, made use of his long friendship with the Saudis for the family's personal gain, HRC gave access to the likes of the crown prince of Bahrain and Nobel Peace Prize Winner Muhammad Yunus. Not equivalent. Not even close. I wonder how routine it is for a Secretary of State to meet with the crown prince of an oil-producing nation or a Nobel Prize winner versus how routine is it for foreign oligarchs friendly to a president to bailout his son.

    But at least the Saudis were allies of the US. Today, the GOP nominee has undisclosed but apparently significant business ties to close allies of the president of our greatest strategic adversary, and expresses his admiration for an autocrat who is seizing territory in Europe and terminating his opponents. I've missed your post on this one, though I'm sure there is one.

    One last point: This controversy involved some 85 meetings or telephone calls HRC granted to Foundation donors. The media have morphed this into 85 meetings, dropping the "and telephone calls," and made this out to be a pretty big number. Naive readers and Hillary haters have accepted it as such. If fact, 85 meetings and telephone calls over four years are, well, de minimis.

    Many of these donors had standing sufficient to get them in the door whether they gave to the Foundation or not. But let's say all of them gained access solely as a result of their donations. Over the four years HRC was Secretary of State, 85 meetings and telephone calls work out to 1.8 meetings/calls per month. Let's make a guess that she met or talked on the phone with an average of 15 people a day. So, one of every 250 people HRC met or had a phone call with each month, or 21 out of 3000 each year, would have secured their contact with her by donating to the Foundation. 85 doesn't look so big in context, especially since no one has presented any evidence of any quid pro quos.

  3. Ray LaPan-Love | August 26, 2016 at 2:42 am | Philip,
    The 85 meetings occurred during about half of HRC's term and I've not heard anyone else dilute things with "phone calls".

    Plus, the Bahrainis were approved for a major arms deal after donating. The Prince tried to make an appointment with HRC privately, but was made to go through State Dept. channels before being allowed a meeting.

    HRC was also involved in the selling of more weapons in her term than all of those occurring during the Bush 43 terms combined.

  1. Ray LaPan-Love | August 26, 2016 at 2:50 am | Philip.
    Also, there is this:
    "You had a situation, that The Wall Street Journal reported, where Hillary Clinton herself intervened in a case dealing with taxes with UBS, a Swiss bank, and then, suddenly, after that, UBS began donating big to the Clinton Foundation. So there are many examples of-I mean, there's oil companies-that's another one I should mention right now, which is that oil companies were giving big to the Clinton Foundation while lobbying the State Department-successfully-for the passage of the Alberta Clipper, the tar sands pipeline."
    David Sarota, interview: http://www.democracynow.org/2016/8/25/weapons_pipelines_wall_st_did_clinton
  2. Ray LaPan-Love | August 26, 2016 at 9:40 am | Other noteworthy donors to the Clinton Foundation:
    $1,000,000-$5,000,000

    Carlos Slim
    Chairman & CEO of Telmex, largest New York Times shareholder

    James Murdoch
    Chief Operating Officer of 21st Century Fox

    Newsmax Media
    Florida-based conservative media network

    Thomson Reuters
    Owner of the Reuters news service

    $500,000-$1,000,000

    Google

    News Corporation Foundation
    Philanthropic arm of former Fox News parent company

    $250,000-$500,000

    Houghton Mifflin Harcourt
    Publisher

    Richard Mellon Scaife
    Owner of Pittsburgh Tribune-Review

    $100,000-$250,000

    Abigail Disney
    Documentary filmmaker

    Bloomberg Philanthropies

    Howard Stringer
    Former CBS, CBS News and Sony executive

    Intermountain West Communications Company
    Local television affiliate owner (formerly Sunbelt Communications)

    $50,000-$100,000

    Bloomberg L.P.

    Discovery Communications Inc.

    George Stephanopoulos
    ABC News chief anchor and chief political correspondent

    Mort Zuckerman
    Owner of New York Daily News and U.S. News & World Report

    Time Warner Inc.
    Owner of CNN parent company Turner Broadcasting

    $25,000-$50,000

    AOL

    HBO

    Read more: http://www.politico.com/blogs/media/2015/05/clinton-foundation-donors-include-dozens-of-media-organizations-individuals-207228#ixzz4IRfGoJcr
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  1. publiustex | August 26, 2016 at 10:11 am | Hello Ray,

    First, I'd appreciate it if you could provide a cite supporting the statement that move arms sales occurred during HRC's four years than during W's eight years. I'd like to look under the cover of that one.

    Also, it's important to note that a lot more people are involved in approving arms sales than the SoS, including Republicans on the Hill.

    Second, the AP touted its original story as being "meetings" but when you read the story itself you found it was "meetings and phone calls." Subsequently, the media and commentariat referred to 85 meetings, dropping reference to phone calls.

    Now for the arms sales to Bahrain. This one is especially juicy because it's an excellent example of how HRC is being tarred.

    The US has massive military assets in Bahrain, which hosts the largest US military outpost in the Gulf. We've been making massive arms sale to Bahrain for many years. So no surprise that we'd make some when HRC was SoS.

    And considering the strategic importance of Bahrain, there's no surprise in HRC meeting with the crown prince. The surprise would be if she declined to do so.

    Now, if memory serves, and I encourage you to check me on this, the US suspended arms sales to Bahrain while HRC was SoS in response to the Bahrain's suppression of dissent among its Shia minority. Later, we partially lifted the suspension to allow sales of arms Related to protecting our huge naval base in Bahrain. I think this decision also came while HRC was SoS.

    So, the arm sales to Bahrain illustrates my objections to the facile claims that contributions to the CF suggest that HRC is corrupt. These claims bring one sliver of information to the discussion: so and so donated money to the CF and then talked to HRC on the phone (or got a meeting). No evidence is produced that there's a causal relationship between the two much less a quid pro quo in which the donation and meeting led HRC to act in an official capacity to benefit the contributor.

    All of the examples I've seen so far, the oil companies, UBS, etc. are like this. No context, no evidence of a quid pro quo, all inuendo.

  2. publiustex | August 26, 2016 at 10:20 am | I consider some of these contributors to be unsavory, and I wish they'd give the Clinton Foundation a lot more money so they'd have less to sink into GOP House and Senate races.
  1. Philip Diehl | August 26, 2016 at 11:05 am | Ray LaPan-Love: You left out this quote from the interview with David Sirota. Context matters.

    'DAVID SIROTA: Well, my reaction to it is that I think that if you look at some of these individual examples, I think Paul is right that it's hard to argue that their donations to the foundation got them access. They are - a lot of these people in the AP story are people who knew her."

  2. Ray LaPan-Love | August 26, 2016 at 11:21 am | Pub,
    I can't remember where I saw the comparison between the arms sales of HRC and the shrub. But, if it comes to me I'll add it later. Meanwhile, here is a link to lots of related info:

    https://www.google.com/?gws_rd=ssl#q=Arms+sales+under+obama

    And yes, "no context, no evidence of a quid pro quo", and almost as if she knew she might run for the prez job.

  3. Ray LaPan-Love | August 26, 2016 at 11:41 am | Sorry Phillip, but gee whiz, am I to assume that nobody else has any 'context' on a story that is difficult to miss. Where does one draw such lines? And the spin you are hoping for is somewhat unwound by David using the phrase "hard to argue". That could be interpreted to simply mean that the CF is good at obfuscating. And as someone who has worked in politics and even for a large NPO, I can atably assure you
  4. Ray LaPan-Love | August 26, 2016 at 11:59 am | ….!!!!!! my cursor got stuck on the previous comment as I tried to use spell-check.
    Anyway, I was trying to comfratably assure you that these organizations are commonly structured to allow for deceptive practices. The Sierra Club for example has affiliates that collect donations and then those funds are used to pay the overhead of the affiliate 'before' any money is donated to the Sierra Club. Thus, the Sierra club's solicitation costs are not reflected in the percentage of funds used toward whatever cause. This is not of course very subtle, and a Foundation such the CF could not likely get away something this obvious, but…schemes such those exposed by the Panama Papers should make us all hesitant to assume anything.
  5. RICK | August 26, 2016 at 12:20 pm | Dear James -

    I'm a long-time fan of your smart writing and the important work that you (and Simon) do. But what's with this constant Clinton Derangement Syndrome? Why look so hard to find some morsel of "scandal" with the Clintons when there's an entire herd of elephants in the room with the Republican candidate??

    As a wealth manager of many years, I must disagree with your dismissive assessment of the Clintons' personal philanthropy as a personal piggy bank. For sure, in a regular family foundation (many of my clients!) the grants and donations are entirely at the discretion of the controlling family, and very often it's all about shiny brass plaques and photo ops with museum directors or mayors. Fine, that's our system, and at least something gets done. And then the donors die and the plaques fade. A shawl has no pockets.

    But the Clinton operation is unique: they choose specific issues, partner with competent outside groups, and then direct enormous extra outside funds - not just their own meager foundation money - to tackle the problems. This is only possible because of their international status; not a Gates nor a Slim nor a Zuckerberg could engineer the same.

    One can certainly speculate about who got access (a phone call, seriously?) or who was schmoozed in what way in order to secure their donations. But to broad-brush the whole of the Clinton philanthropy as personal corruption is truly unfair. And it sure doesn't make sense when there's so much worse and genuinely scandalous material on the other side just waiting to be uncovered.

    Keep the faith!

  1. Bruce E. Woych | August 27, 2016 at 2:39 pm | Note: (from Global Research critique @ (eg: https://mail.aol.com/webmail-std/en-us/suite ) cited above: "Philosopher, novelist, filmmaker and investigative journalist, Andre Vltchek has covered wars and conflicts in dozens of countries. His latest books are: "Exposing Lies Of The Empire" and "Fighting Against Western Imperialism". Discussion with Noam Chomsky: On Western Terrorism. Point of No Return is his critically acclaimed political novel. Oceania – a book on Western imperialism in the South Pacific. His provocative book about Indonesia: "Indonesia – The Archipelago of Fear". Andre is making films for teleSUR and Press TV.
  2. Ray LaPan-Love | August 27, 2016 at 3:42 pm | Bruce, (been awhile),
    High grade stuff there. Yet, I'm not as taken by Caros' comment as you seem to be. Near the end, this part: "The Clinton family business is benefiting themselves AND OTHERS by way of their prominence."
    To begin with, the Clinton's influence in arming the royal gulfies may get us all killed, and so his comparison to the Bushs, while apt in a current sense, it may well be…dangerously premature. Then too, Caro is of course taking sides as if the Clintons don't fully realize the P.R. benefits of giving away other peoples money. Which segs the question of how could the Clintons have put so much time and effort into Hillary's run, while creating so many pitfalls for themselves? Did they think the Repubs might get nice? Are they stupid, arrogant maybe? Or just so corrupt that they just can't stop like so many kleptomaniacs? In any case, it isn't only Trump's fitness that we should be questioning.

[Sep 15, 2016] Clinton Corruption Watch, Sept. 15, 2016

Notable quotes:
"... "State Department Delays Records Request About Clinton-Linked Firm Until After The 2016 Election" [ International Business Times ]. "Beacon Global Strategies is a shadowy consulting firm that's stacked with former Obama administration officials, high profile Republicans and a number of Hillary Clinton's closest foreign policy advisers. But beyond its billing as a firm that works with the defense industry, it is unclear for whom specifically the company works, exactly what it does, and if Beacon employees have tried to influence national security policy since the firm's founding in 2013. ..."
"... UPDATE "New York-based Teneo, with 575 employees, markets itself as a one-stop shop for CEOs to get advice on a wide range of issues, including mergers and acquisitions, handling crises and managing public relations. For its services, it generally charges clients monthly retainer fees of $100,000 to $300,000." [ Wall Street Journal , "Teneo, Consulting Firm with Clinton Ties, Eyes $1 Billion IPO"]. Founder Douglas Band was Bill Clinton's body man . One can only wonder what a body man does to become worth $1 billion to, well, the people who made him worth a billion. ..."
"... The donors expect that their support of the Clinton Foundation will help them get access to the State Department, [Doug] Band see above] expects that he can count on [Huma] Abedin to help, and Abedin seems to understand that she needs to be responsive to Band. This would be a lot of effort for powerful people to expend, if it led to nothing at all. ..."
"... UPDATE "Even as the Clintons are touting plans to distance themselves from their foundation and limit its fundraising if Hillary Clinton is elected president, they're planning one last glitzy fundraising bash on Friday to belatedly celebrate Bill Clinton's 70th birthday" [ Politico ]. ..."
"... "Plans called for performances by Wynton Marsalis, Jon Bon Jovi and Barbra Streisand, according to people briefed on the planning. They said that major donors are being asked to give $250,000 to be listed as a chair for the party, $100,000 to be listed a co-chair and $50,000 to be listed as a vice-chair." Sounds lovely! How I wish I could go… ..."
Sep 15, 2016 | www.nakedcapitalism.com

"State Department Delays Records Request About Clinton-Linked Firm Until After The 2016 Election" [ International Business Times ]. "Beacon Global Strategies is a shadowy consulting firm that's stacked with former Obama administration officials, high profile Republicans and a number of Hillary Clinton's closest foreign policy advisers. But beyond its billing as a firm that works with the defense industry, it is unclear for whom specifically the company works, exactly what it does, and if Beacon employees have tried to influence national security policy since the firm's founding in 2013.

UPDATE "New York-based Teneo, with 575 employees, markets itself as a one-stop shop for CEOs to get advice on a wide range of issues, including mergers and acquisitions, handling crises and managing public relations. For its services, it generally charges clients monthly retainer fees of $100,000 to $300,000." [ Wall Street Journal , "Teneo, Consulting Firm with Clinton Ties, Eyes $1 Billion IPO"]. Founder Douglas Band was Bill Clinton's body man . One can only wonder what a body man does to become worth $1 billion to, well, the people who made him worth a billion.

"[I]n many of these [Clinton Foundation] episodes you can see expectations operating like an electrical circuit. The donors expect that their support of the Clinton Foundation will help them get access to the State Department, [Doug] Band see above] expects that he can count on [Huma] Abedin to help, and Abedin seems to understand that she needs to be responsive to Band. This would be a lot of effort for powerful people to expend, if it led to nothing at all. There are two obvious possibilities. One is that the State Department actually was granting important favors to Clinton Foundation donors that the many sustained investigations have somehow failed to detect. The other, which is more likely, is that someone, somewhere along the line, was getting played" [ The New Yorker ]. Surely those two possibilities are not mutually exclusive? And public office is being used for private gain in either case?

UPDATE "Even as the Clintons are touting plans to distance themselves from their foundation and limit its fundraising if Hillary Clinton is elected president, they're planning one last glitzy fundraising bash on Friday to belatedly celebrate Bill Clinton's 70th birthday" [ Politico ].

"Plans called for performances by Wynton Marsalis, Jon Bon Jovi and Barbra Streisand, according to people briefed on the planning. They said that major donors are being asked to give $250,000 to be listed as a chair for the party, $100,000 to be listed a co-chair and $50,000 to be listed as a vice-chair." Sounds lovely! How I wish I could go…

[Sep 15, 2016] Are the categories terrorist and dictator versus crucial allies are determined based on the size of payments to the Clinton Foundation?

Sep 15, 2016 | www.moonofalabama.org

As one Michael Curry points out , Clinton's social messaging team is simply incompetent.

From a series of Clinton tweets attacking Trump over his assumed foreign policy:

Hillary Clinton @HillaryClinton

4. If you were willing to work with Qaddafi-a known terrorist and dictator-is there anyone you aren't willing to make a deal with? Who?

9:32 AM - 14 Sep 2016

---

Hillary Clinton @HillaryClinton

Hillary Clinton Retweeted Donald J. Trump

13. How can we know you won't (again) impulsively damage relationships with crucial allies to preserve your own ego? Hillary Clinton added,

Donald J. Trump @realDonaldTrump
Dopey Prince @Alwaleed_Talal wants to control our U.S. politicians with daddy's money. Can't do it when I get elected. #Trump2016

7:53 PM - 11 Dec 2015

9:48 AM - 14 Sep 2016

Is such incompetence in messaging a reflection of Hillary Clinton own confusion? Or are the categories "terrorist and dictator" versus "crucial allies" solely depending on the size of payments to the Clinton Foundation?

Posted by b at 02:03 PM | Comments (6) originalone | Sep 15, 2016 2:08:08 PM | 1
Again, B hits the nail on the head. Oh wait, could it be the koolaid by Putin the cause?

Terry | Sep 15, 2016 2:21:10 PM | 2
She is sliding to throwing mud ,. what ever will stick will do the trick I guess .This started after some polls showing the Donald ahead a few points .

FecklessLeft | Sep 15, 2016 2:52:32 PM | 3
I recognize election season is always crazy in the states, especially as an outside observer looking in, but this cycle seems so far beyond that norm compared even to 4 years ago it makes me quite uncomfortable. It reeks of a growing desperation by the elites to me. The 2012 campaigns of the two major parties were a circus by any measure, but they seem completely measured and intellectual by this year's standards.

I understand American culture dwells a lot on violence, but the new standards of political rhetoric disturb me greatly. It seems most of the country's population is either willfully ignorant of the destruction their country creates or cheers it on wildly and willingly. How anybody could advocate carpet bombing without irony or rebuttal is frightenening. That it could drum up support - well that's just depressing.

The two most important topics in this election, nuclear weapons and global warming, both candidates have been decidedly silent about. It scares me that neither party even attempts to appeal to the left anymore, except by manipulating them by fear and non existent 'security' issues. If it's all about PR and perception management anyways, I wonder why Clinton wears her right leaning nature and war mongering history on her sleeve? Maybe content and debate matters less than I assume it does to the average American voter. Maybe it's totally about spectacle and personality now and nothing else. Sad, sad days for those who live in the middle of the Empire but it's hard to be sympathetic sometimes. It seems the hot new consumer electronic device gets more of a thorough analysis and debate than does either major party candidates' platform (if you could even call it that).

Vote republican and catastrophic, irreversible climate change is almost guaranteed, with a hearty chance of more war and more regime change operations (despite attempts to paint the candidate as 'isolationist').

Vote democrat for more wars and regime change, with the status quo of environmental destruction happily maintained (despite the attempts to paint the candidate as an 'environmentalist').

james | Sep 15, 2016 2:54:25 PM | 4
this us election is much more pathetic then usual... witnessing the standing president refer to putin akin to saddam hussain is frankly insane, but shows how depraved the usa has gotten... and, besides that, since when did the average usa person even know where any place outside the usa was on a map, let alone having actually been their? oh - i guess it doesn't matter...

as @1 originalone says basically 'putin did it'...

Les | Sep 15, 2016 2:57:20 PM | 5
As everyone knows, the US normalized relations with Qaddafi in 2004.

https://en.wikipedia.org/wiki/Libya%E2%80%93United_States_relations#Normalizing_relations

The Obama administration authorized CIA backing of the rebellion almost before it started. In all likelihood, it started several years before the revolt, and the authorization was to provide legal cover for activity that was already ongoing.

http://www.reuters.com/article/us-libya-usa-order-idUSTRE72T6H220110331

Erelis | Sep 15, 2016 3:18:51 PM | 6
@ FecklessLeft 3

Unfortunately, your observations are sharp, correct and to the point. All I can weakly offer is something Ralph Nader said. Ralph Nader once noted that the difference between the democrats and republicans is the difference between a car hitting a wall at 60 miles per hour versus 120 miles per hour. Not so anymore. Now both cars will hit the wall going as fast as they can. And the passengers will jump for joy at the speed.

[Sep 12, 2016] Serving the Clintonian Interest: The last thing we need is a Clinton in charge of foreign policy by Christopher Hitchens

This is Christopher Hitchens biting analysis from previous Presidential elections, but still relevant
Notable quotes:
"... The last time that Clinton foreign-policy associations came up for congressional review, the investigations ended in a cloud of murk that still has not been dispelled. ..."
"... the real problem is otherwise. Both President and Sen. Clinton, while in office, made it obvious to foreign powers that they and their relatives were wide open to suggestions from lobbyists and middlemen. ..."
"... If you recall the names John Huang, James Riady, Johnny Chung, Charlie Trie, and others, you will remember the pattern of acquired amnesia syndrome and stubborn reluctance to testify, followed by sudden willingness on the part of the Democratic National Committee to return quite large sums of money from foreign sources. Much of this cash had been raised at political events held in the public rooms of the White House, the sort of events that featured the adorable Roger Tamraz , for another example. ..."
"... It found that the Clinton administration's attitude toward Chinese penetration had been abysmally lax (as lax, I would say, as its attitude toward easy money from businessmen with Chinese military-industrial associations). ..."
"... Many quids and many quos were mooted by these investigations (still incomplete at the time of writing) though perhaps not enough un-ambivalent pros . You can't say that about the Marc Rich and other pardons-the vulgar bonanza with which the last Clinton era came to an end. Rich's ex-wife, Denise Rich, gave large sums to Hillary Clinton's re-election campaign and to Bill Clinton's library, and Marc Rich got a pardon. ..."
"... Edgar and Vonna Jo Gregory, convicted of bank fraud, hired Hillary Clinton's brother Tony and paid him $250,000, and they got a pardon. Carlos Vignali Jr. and Almon Glenn Braswell paid $400,000 to Hillary Clinton's other brother, Hugh , and, hey, they , respectively, got a presidential commutation and a presidential pardon, too. ..."
"... Does this sibling and fraternal squalor have foreign-policy implications, too? Yes. Until late 1999, the fabulous Rodham boys were toiling on another scheme to get the hazelnut concession from the newly independent republic of Georgia. There was something quixotically awful about this scheme-something simultaneously too small-time and too big-time-but it also involved a partnership with the main political foe of the then-Georgian president (who may conceivably have had political aspirations), so once again the United States was made to look as if its extended first family were operating like a banana republic. ..."
"... In matters of foreign policy, it has been proved time and again, the Clintons are devoted to no interest other than their own. ..."
"... Who can say with a straight face that this is true of a woman whose personal ambition is without limit; whose second loyalty is to an impeached and disbarred and discredited former president; and who is ready at any moment, and on government time, to take a wheedling call from either of her bulbous brothers? This is also the unscrupulous female who until recently was willing to play the race card on President-elect Obama and (in spite of her own complete want of any foreign-policy qualifications) to ridicule him for lacking what she only knew about by way of sordid backstairs dealing. What may look like wound-healing and magnanimity to some looks like foolhardiness and masochism to me. ..."
Nov 01, 2008 | www.slate.com

It was apt in a small way that the first endorser of Hillary Rodham Clinton for secretary of state should have been Henry Kissinger. The last time he was nominated for any position of responsibility-the chairmanship of the 9/11 commission-he accepted with many florid words about the great honor and responsibility, and then he withdrew when it became clear that he would have to disclose the client list of Kissinger Associates. (See, for the article that began this embarrassing process for him, my Slate column "The Latest Kissinger Outrage.")

It is possible that the Senate will be as much of a club as the undistinguished fraternity/sorority of our ex-secretaries of state, but even so, it's difficult to see Sen. Clinton achieving confirmation unless our elected representatives are ready to ask a few questions about conflict of interest along similar lines. And how can they not? The last time that Clinton foreign-policy associations came up for congressional review, the investigations ended in a cloud of murk that still has not been dispelled. Former President Bill Clinton has recently and rather disingenuously offered to submit his own foundation to scrutiny (see the work of my Vanity Fair colleague Todd Purdum on the delightful friends and associates that Clinton has acquired since he left office), but the real problem is otherwise. Both President and Sen. Clinton, while in office, made it obvious to foreign powers that they and their relatives were wide open to suggestions from lobbyists and middlemen.

Just to give the most salient examples from the Clinton fundraising scandals of the late 1990s: The House Committee on Government Reform and Oversight published a list of witnesses called before it who had either "fled or pled"-in other words, who had left the country to avoid testifying or invoked the Fifth Amendment to avoid self-incrimination. Some Democratic members of the committee said that this was unfair to, say, the Buddhist nuns who raised the unlawful California temple dough for then-Vice President Al Gore, but however fair you want to be, the number of those who found it highly inconvenient to testify fluctuates between 94 and 120. If you recall the names John Huang, James Riady, Johnny Chung, Charlie Trie, and others, you will remember the pattern of acquired amnesia syndrome and stubborn reluctance to testify, followed by sudden willingness on the part of the Democratic National Committee to return quite large sums of money from foreign sources. Much of this cash had been raised at political events held in the public rooms of the White House, the sort of events that featured the adorable Roger Tamraz, for another example.

Related was the result of a House select committee on Chinese espionage in the United States and the illegal transfer to China of advanced military technology. Chaired by Christopher Cox, R-Calif., the committee issued a report in 1999 with no dissenting or "minority" signature. It found that the Clinton administration's attitude toward Chinese penetration had been abysmally lax (as lax, I would say, as its attitude toward easy money from businessmen with Chinese military-industrial associations).

Many quids and many quos were mooted by these investigations (still incomplete at the time of writing) though perhaps not enough un-ambivalent pros. You can't say that about the Marc Rich and other pardons-the vulgar bonanza with which the last Clinton era came to an end. Rich's ex-wife, Denise Rich, gave large sums to Hillary Clinton's re-election campaign and to Bill Clinton's library, and Marc Rich got a pardon.

Edgar and Vonna Jo Gregory, convicted of bank fraud, hired Hillary Clinton's brother Tony and paid him $250,000, and they got a pardon. Carlos Vignali Jr. and Almon Glenn Braswell paid $400,000 to Hillary Clinton's other brother, Hugh, and, hey, they, respectively, got a presidential commutation and a presidential pardon, too. In the Hugh case, the money was returned as being too embarrassing for words (and as though following the hallowed custom, when busted or flustered, of the Clinton-era DNC). But I would say that it was more embarrassing to realize that a former first lady, and a candidate for secretary of state, was a full partner in years of seedy overseas money-grubbing and has two greedy brothers to whom she cannot say no.

Does this sibling and fraternal squalor have foreign-policy implications, too? Yes. Until late 1999, the fabulous Rodham boys were toiling on another scheme to get the hazelnut concession from the newly independent republic of Georgia. There was something quixotically awful about this scheme-something simultaneously too small-time and too big-time-but it also involved a partnership with the main political foe of the then-Georgian president (who may conceivably have had political aspirations), so once again the United States was made to look as if its extended first family were operating like a banana republic.

China, Indonesia, Georgia-these are not exactly negligible countries on our defense and financial and ideological peripheries. In each country, there are important special interests that equate the name Clinton with the word pushover. And did I forget to add what President Clinton pleaded when the revulsion at the Rich pardons became too acute? He claimed that he had concerted the deal with the government of Israel in the intervals of the Camp David "agreement"! So anyone who criticized the pardons had better have been careful if they didn't want to hear from the Anti-Defamation League. Another splendid way of showing that all is aboveboard and of convincing the Muslim world of our evenhandedness.

In matters of foreign policy, it has been proved time and again, the Clintons are devoted to no interest other than their own. A president absolutely has to know of his chief foreign-policy executive that he or she has no other agenda than the one he has set. Who can say with a straight face that this is true of a woman whose personal ambition is without limit; whose second loyalty is to an impeached and disbarred and discredited former president; and who is ready at any moment, and on government time, to take a wheedling call from either of her bulbous brothers? This is also the unscrupulous female who until recently was willing to play the race card on President-elect Obama and (in spite of her own complete want of any foreign-policy qualifications) to ridicule him for lacking what she only knew about by way of sordid backstairs dealing. What may look like wound-healing and magnanimity to some looks like foolhardiness and masochism to me.

Christopher Hitchens (1949-2011) was a columnist for Vanity Fair and the author, most recently, of Arguably, a collection of essays.

[Sep 05, 2016] Gli Usa e la guerra fredda il prezzo della vittoria - rivista italiana di geopolitica

Bill Clinton was a regular neoliberal bottom feeder (in essence not that different from drunkard Yeltsin) without any strategical vision or political courage, He destroyed the golden possibility of rapprochement of the USA and Russia (which would require something like Marshall plan to help Russia). Instead he decided to plunder the country. It's sad that now Hillary will continue his policies, only in more jingoistic, dangerous fashion. She learn nothing.
Notable quotes:
"... However, according to Simes in the years immediately following the dissolution of the USSR, Washington has made perhaps the greatest error of a winner: sold for complacency. ..."
"... Russia simply ceased to be a U.S. geopolitical variable in the equation, Moscow was irrevocably excluded from the strategic horizon. ..."
"... The result was that the former Deputy Secretary of State Strobe Talbott called at the time the policy of "eat and shut up": the Russian economy was collapsing, the Red Army reduced the ghost of the past and Yeltsin's entourage welcomed with open arms of the IMF aid. In short, Russia is a power failure and as such was treated by administering liberal economic recipes and submitting its projection to a geopolitical drastic weight loss. Everything apart from the feeling of the Russian leadership. ..."
"... This approach found its full realization, between 1999 and 2004, the expansion of NATO eastward: they were including Poland, Hungary, Czech Republic, Slovakia, Slovenia, Bulgaria, Romania, Estonia, Latvia and Lithuania. Together with the U.S. intervention in Serbia during the Kosovo war (1999), this move Russia convinced that the cost of the American loans -- a dramatic and permanent reduction of the area of ​​security and its own geopolitical ambitions - was too high . ..."
Dec 12, 2011 | temi.repubblica.it

07/12/2011

America won the Cold War. But in addition to the USSR, has it defeated Russia? This question, which is still in the nineties sounded absurd to most people, began to appear in the last decade, thanks to the work of historians such as Dimitri Simes, John Lewis Gaddis, or in Italy, Adriano Roccucci.

In the United States is widely believed that the collapse of the Soviet Union was caused in large part by strategic decisions of the Reagan administration. Surely the military and economic pressure exerted by these contributed to the disintegration of the Warsaw Pact and then the final crisis of the Soviet system. However, according to Simes in the years immediately following the dissolution of the USSR, Washington has made perhaps the greatest error of a winner: sold for complacency.

This has resulted, in retrospect, in an overestimation of U.S. policy choices in the mid-eighties onwards, and in a parallel underestimation of the role played by the Soviet leadership. Gorbachev came to power in 1985 determined to solve the problems left behind by Brezhnev: overexposure military in Afghanistan and subsequent explosion of spending on defense, imposed on an economy tremendously inefficient. But if Reagan pushed the USSR on the edge of the precipice, Gorbachev was disposable, albeit unwittingly, triggering reforms that escaped the hands of his own theorist.

That fact has been largely removed from public debate and U.S. historiography which has led America in the second mistake: underestimating the enemy defeated, confusing the defunct Soviet Union with what was left of his heart - Russia.

In fact, Reagan and Bush Sr. after him fully understand the dangers inherent in the collapse of the superpower enemy, dealing with Gorbachev touch, even without discounts: the Soviet leader was refused the pressing demands for economic aid, incompatible with the military escalation Reagan once to crush the Soviet Union under the weight of war spending.

Even the first Gulf War (1990-91), who saw the massive American intervention in a country (Iraq) at the time near the borders of the USSR, did not provoke a diplomatic rupture between the two superpowers. This Soviet weakness undoubtedly was the result of an empire in decline, but remember that even in 1990 no one - least of all, the leadership in Moscow - the Soviet Union finally gave up on us yet.

Despite an election campaign played on the charge to GH Bush to focus too much on foreign policy, ignoring the economics (It's the economy, stupid), newly installed in the White House Bill Clinton was not spared aid to Russia, agreeing to this line of credit to be logged on to the International Monetary Fund (IMF), from June 1992. Clinton's support was directed mainly toward the figure of Yeltsin and his policies, with the exception of waging war against Chechen separatism, in 1994.

If Clinton with these moves proved to understand, like its two predecessors, the importance of "accompany" the Russian transition, avoiding - or at least contain - the chaos following the collapse of a continental empire, the other part of his administration demonstrated sinful paternalism and, above all, acquired the illusion of omnipotence that he saw in the "unipolar moment" end not only the U.S. opposed the US-USSR, but also of any power ambitions of Russia. Russia simply ceased to be a U.S. geopolitical variable in the equation, Moscow was irrevocably excluded from the strategic horizon.

The result was that the former Deputy Secretary of State Strobe Talbott called at the time the policy of "eat and shut up": the Russian economy was collapsing, the Red Army reduced the ghost of the past and Yeltsin's entourage welcomed with open arms of the IMF aid. In short, Russia is a power failure and as such was treated by administering liberal economic recipes and submitting its projection to a geopolitical drastic weight loss. Everything apart from the feeling of the Russian leadership.

This went hand in hand with growing resentment for the permanent position of inferiority which they were relegated by Washington. To the point that even the then Foreign Minister Andrei Kozyrev, known by the nickname "Yes sir" for his acquiescence to the dictates of Americans, showed growing impatience with the brutal Russian downgrading by America.

Indeed, the United States administration did not lack critics: former President Nixon, a number of businessmen and experts of Russia expressed skepticism or opposition to the Clinton administration attitude that did not seem to pay particular attention to wounded pride and the strategic interests of a nation that continued to think of itself as empire. However, these positions does not affect the dominant view in the administration of the establishment and much of the U.S., where consencus was that Russia in no longer entitled to have an independent foreign policy.

This approach found its full realization, between 1999 and 2004, the expansion of NATO eastward: they were including Poland, Hungary, Czech Republic, Slovakia, Slovenia, Bulgaria, Romania, Estonia, Latvia and Lithuania. Together with the U.S. intervention in Serbia during the Kosovo war (1999), this move Russia convinced that the cost of the American loans -- a dramatic and permanent reduction of the area of ​​security and its own geopolitical ambitions - was too high .

[Sep 04, 2016] UBS upped its cash to Bill and the foundation after the scandal and her intervention as Sec. of State

Sep 04, 2016 | economistsview.typepad.com
Julio -> EMichael... Friday, September 02, 2016 at 10:03 AM

Look more carefully at the timeline, UBS upped its cash to Bill and the foundation after the scandal and her intervention as Sec. of State. See e.g.
http://www.theatlantic.com/politics/archive/2015/07/hillary-helps-a-bankand-then-it-pays-bill-15-million-in-speaking-fees/400067/

The whole thing smells to high heaven. The only reason to trust that there are no direct quid pro quos is, perversely, that there are so many donations and so many speeches and interactions that they all begin to seem normal.

Yes, there may be smoke and no fire, in the legal sense, but let us not pretend there are no issues here.

[Sep 03, 2016] Buying access is the same as putting a stack of cash into someone's pocket to get them to vote one way or another on a bill of interest

Notable quotes:
"... Does it get money because of the Clintons involvement in raising money? Undoubtedly, without their participation it can't raise anywhere near that amount of money, and the reason is that their high public profile means that people believe that by giving to them they can influence policy, ..."
angrybearblog.com

J.Goodwin, August 31, 2016 10:35 am

Low level personnel in the US government are expected to reject gifts, or if culturally they cannot, then they turn them over to their agency, unless it is something like a coffee or a sandwich.

There is an expectation that people are going to not just not actually corrupt their job by doing favors for people who give them gifts or do them favors, but that they will avoid the appearance of corruption that is generated by accepting gifts.

The supreme court doesn't agree with that anymore. Anyone can accept any kind of bribe as long as they don't let it influence their actions. You can't see the desk for the treasure that's being dumped onto political tables to fund campaigns and line their personal pockets.

This is a foreign practice, one that is corrupt and should be rooted out nationally. Accepting gifts creates a corrupting environment, no matter what the recipient does, because EVERYONE understands that the gift is intended to influence policy or gain access so that the person can influence policy. The person giving the gift knows it, or they wouldn't give it, the person receiving the gift knows it, but "deep down in their honest hearts" they're not going to allow it to influence their work and decisions?

No of course not. Buying access is the same as putting a stack of cash into someone's pocket to get them to vote one way or another on a bill of interest.

Does the Clinton foundation do good work? Sure. Does it get money because of the Clintons involvement in raising money? Undoubtedly, without their participation it can't raise anywhere near that amount of money, and the reason is that their high public profile means that people believe that by giving to them they can influence policy, even if those people are not in office (through backchannels and whispers and introductions).

Does every person donating to the Clinton foundation want to influence policy, or are they primarily motivated by wanting to fund it's good works? This is impossible to tell. Even someone as prominent and perhaps morally blameless Elie Wiesel isn't there to eat cookies and have tea and talk about the weather if he's in Hillary Clinton's office. That is not what he is there for. That kind of meeting is not purely a social call, it's an effort to influence policy, whether it is related to statements on the Armenian genocide or the Sudan or god knows what.

Is he a person that she should meet with, whether he gives a donation to her foundation or not? Maybe that is her job. Probably most of these meetings are that way. That's why public officials are expected to put investments and charities into trusts and blinds and under separate management when they're in office, to help establish the boundary between their public responsibilities and their private interests including their charitable interests.

It doesn't matter to me whether she did anything that she shouldn't have done, legally. The letter of the law is insufficient to dictate the actions of moral people. Is it disqualifying? She's already been disqualified in my mind, this is just another thing.

Is it disturbing and annoying to me to see the double standard where promoters are willing to weasel and explain away whatever the Clintons have done that for any person on the other side of the aisle would be moral issues that disqualify them from office?

[Sep 03, 2016] Emails Raise New Questions About Clinton Foundation Ties to State Dept

Notable quotes:
"... A top aide to Hillary Clinton at the State Department agreed to try to obtain a special diplomatic passport for an adviser to former President Bill Clinton in 2009, according to emails released Thursday, raising new questions about whether people tied to the Clinton Foundation received special access at the department. ..."
"... The exchange about the passport, between Mr. Band and Huma Abedin, who was then a top State Department aide to Mrs. Clinton, was included in a set of more than 500 pages of emails made public by Judicial Watch, a conservative legal group that sued for their release. ..."
"... "Need get me/justy and jd dip passports," Mr. Band wrote to Ms. Abedin on July 27, 2009, referring to passports for himself and two other aides to Mr. Clinton, Justin Cooper and John Davidson. ..."
"... Traveling with a former president does not convey any special diplomatic status, the State Department indicated in a statement regarding the emails. "Diplomatic passports are issued to Foreign Service officers or a person having diplomatic or comparable status," the statement said. ..."
"... "Any individuals who do not have this status are not issued diplomatic passports," it said, adding that "the staff of former presidents are not included among those eligible to be issued a diplomatic passport." ..."
Sep 03, 2016 | www.nytimes.com

A top aide to Hillary Clinton at the State Department agreed to try to obtain a special diplomatic passport for an adviser to former President Bill Clinton in 2009, according to emails released Thursday, raising new questions about whether people tied to the Clinton Foundation received special access at the department.

The request by the adviser, Douglas J. Band, who started one arm of the Clintons' charitable foundation, was unusual, and the State Department never issued the passport. Only department employees and others with diplomatic status are eligible for the special passports, which help envoys facilitate travel, officials said.

... ... ...

The exchange about the passport, between Mr. Band and Huma Abedin, who was then a top State Department aide to Mrs. Clinton, was included in a set of more than 500 pages of emails made public by Judicial Watch, a conservative legal group that sued for their release.

"Need get me/justy and jd dip passports," Mr. Band wrote to Ms. Abedin on July 27, 2009, referring to passports for himself and two other aides to Mr. Clinton, Justin Cooper and John Davidson.

... ... ...

But a person with knowledge of the issue, who spoke on the condition of anonymity, said that the three men were arranging to travel with Mr. Clinton to Pyongyang less than a week later for the former president's secret negotiations. Mr. Clinton already had a diplomatic passport as a former president.

... ... ...

Traveling with a former president does not convey any special diplomatic status, the State Department indicated in a statement regarding the emails. "Diplomatic passports are issued to Foreign Service officers or a person having diplomatic or comparable status," the statement said.

"Any individuals who do not have this status are not issued diplomatic passports," it said, adding that "the staff of former presidents are not included among those eligible to be issued a diplomatic passport."

The emails released by Judicial Watch also include discussions about meetings between Mrs. Clinton and a number of people involved in major donations to the Clinton Foundation.

In one exchange in July 2009, Ms. Abedin told Mrs. Clinton's scheduler that Mr. Clinton "wants to be sure" that Mrs. Clinton would be able to see Andrew Liveris, the chief executive of Dow Chemical, at an event the next night. Dow Chemical has been one of the biggest donors to the Clinton Foundation, giving $1 million to $5 million, records show.

Ms. Abedin arranged what she called "a pull-aside" for Mr. Liveris to speak with Mrs. Clinton in a private room after she arrived to give a speech, according to the emails, which did not explain the reason for the meeting.

The person with knowledge of the issue said that this email chain also related to Mr. Clinton's North Korea trip because Mr. Liveris had offered to let Mr. Clinton use his private plane.

A separate batch of State Department documents released by Judicial Watch last month also revealed contacts between the State Department and Clinton Foundation donors. In one such exchange, Mr. Band sought to put a billionaire donor in touch with the department's former ambassador to Lebanon.

Donald J. Trump, Mrs. Clinton's Republican opponent, has seized on the documents, saying they revealed a "pay to play" operation.


[Sep 03, 2016] The Real Clinton Foundation Revelation

Notable quotes:
"... "When I was the chief White House ethics lawyer for President George W. Bush," You knew exactly where this article was going once you read the first 14 words. ..."
"... The author was chief ethics lawyer for the George W. Bush Administration. Why does that bother me? I realize this guy's term was from 2005 to 2007 and the Abu Ghraib story pretty much broke in early 2005, ..."
"... How much did the Clinton campaign pay for this Op-Ed? 'Every one does it' and 'it's not illegal'. 'It's how business is done.' How about doing a real in-depth investigation on the Clinton Foundation and perceived favors to donors NYT, instead of more opinion? ..."
"... Clearly a planted article. Nice try. Is everyone aware that the Foundation paid off Clinton's '08 campaign debt? They gave $400,000 and considered "payment for the campaign's mailing lists" ..."
"... According to former Justice Department Deputy Assistant Attorney General Shannen Coffin, there are at least three different categories of federal laws which may be implicated. ..."
"... One, the ethics and government act, which says you can't use a public office for private gain for yourself or even for a charity. So in giving special access to the donors for the Clinton Foundation, the ethics and government act is implicated. So perhaps Mr. Painter is a bit hasty dismissing such claims. ..."
"... If it was only about getting a government post or an arranged meeting, I would agree. But this seems different because significant amounts of money changed hands as a result of State Department intervention. And a lot of that money ended up at the Foundation or as speaking fees to Bill Clinton. How is this not seen as foreign donations effecting an American election - which I believe is illegal. ..."
"... Mr. Painter: You say "There is little if any evidence that federal ethics laws were broken by Mrs. Clinton". So if there is even "little" evidence that the laws were broken, then shouldn't American electorate consider it when making their election day decisions? ..."
"... You did not mention that there was no independent investigation on this subject, so there is no way to know whether there was "little" or "significant" or "overwhelming" evidence that the laws were broken. ..."
"... And finally, even if the written laws were not broken, what about the immorality of what Clintons did? Has morality been completely removed from the public square in this once great country? ..."
"... If there was no evidence of corruption at the Clinton Foundation, then why did Bill Clinton's speaking fees increase astronomically (from roughly $100,000 to $850,000) during Hillary's tenure at the State Department? ..."
"... as the neocons and neolibs in power withdraw from the govt's former "general welfare" Constitutional role and concentrate on enriching themselves and their friends - it would pay for citizens to become more aware of how the sector works. ..."
"... the system they devised inevitably empowers some groups more than others. Since democratic theory defines government officials as representatives of the voters, it encourages constituents to influence the decisions of those agents. Ideally, politicians should not favor the interests of some groups over others, but reality dictates otherwise. ..."
"... In the contest for influence, money inevitably plays a major, although not always decisive, role. In an effort to limit this role, we have developed both formal and informal methods to constrain human greed. The law prohibits bribery, for example. To discourage subtler forms of influence-buying, we have developed codes of ethics that pressure officials to limit financial connections with groups or individuals who might seek their help. ..."
"... Public opinion can serve as a powerful tool to enforce these codes. This explains the informal requirement that a president divest herself of financial connections that might affect her decisions. If Clinton rejects this tradition, she will undermine an important method of limiting the influence of moneyed interests in government. We have too few such tools as it is. ..."
"... Our laws are relatively stringent and prevent the crassest forms of corruption, and our culture makes lesser but legal offenses dangerous politically. But to imagine that any government, anywhere, could function without either those sorts of alliances or some equally corruptible strongman central oversight is is as naive and dangerously idealistic. ..."
"... How would someone feel if they found out that a doctor who prescribed them a medication is also paid large sums by a pharmaceutical company to promote the drug? Or, if the doctors owns substantial amount of stock in the company? Appearances do matter and it is likely that such conflicts do impact judgement. These kinds of allowances are being cleaned up across the country, at least in medicine. ..."
"... I am fine if they get higher salaries, but it is time to clean up the political corruption and crony capitalism. It is a shame that we hold our politicians to such incredible low standards and it is not a surprise that so many people don't bother to vote. ..."
"... It doesn't matter how good or bad the work of the Clinton Foundation is. That is not the question. The question is the motivation of many who contribute to the foundation. Are they motivated by altruism or is donating in a big way a ploy to gain access to Mrs. Clinton. ..."
"... I doubt that Clinton breached a fundamental legal boundary. However, the Clinton's have always seen the bright line and have decided to test the boundaries. From using police to secure women while governor to taking money from Walmart to major financial institutions to the email scandal, the Clinton's do it again and again and blame a vast right wing conspiracy. The Clinton foundation used Doug Band as a bag man securing commercial contracts for Bill and Hilary while he had a senior role at the foundation (flashing red lights). Huma took money off the state department books as did other Clinton confidants (flashing red lights), etc. They can't help themselves. Are these actives illegal? Probably not. However, we seek to be inspired by our leaders, we want leaders who are better than the average, better than us. ..."
"... When Bill can trot off to Russia, get 750k for a speech at the same time that business interests of the donor is before the State Department, it smells. The crux of the matter is the rotten judgement. ..."
"... You want a POTUS who has good judgement. The relentless chasing of a buck mixed with the appearance of impropriety, real or imagined, is the problem. When mixed with her poor judgement on the emails and her poor judgement on invading Iraq and disrupting Libya, you have a problem which explains her low approval rating. She is just fortunate that she has Trump to run against. ..."
"... If we look back to the Bill Clinton and Monica Lewinsky scandal, those that were screaming the loudest for justice were having extramarital affairs during the "investigation". Newt Gingrich, Bob Livingston, Henry Hyde. And then there was Dennis Hastert. ..."
"... You bring up yet another problem with Hilary. She has covered for her sexual predator husband for decades, including harassing and publicly shaming her husband's sexual assault victims. And there are many going back to his Oxford days. How is that ok? ..."
"... The Trumpster won the Republican nomination precisely because of voter disgust over the in-crowd culture of politicians and donors. Bernie Sanders came close to winning the Democratic nomination for much of the same reason. Hilary and her entire family need to wake up fast if she has any hope or desire to get elected. We all know where Hilary's money is coming from. Does Hilary know where her voters are coming from and where they are now? ..."
"... To put this in a nutshell, The Clinton's self-enriching behavior- and use of public office for private gain - is troubling in the extreme ..."
"... During her tenure as Secretary of State (as reported by the AP) of the 154 non-official meetings at least 85 of those individuals were private-sector donors who contributed up to $156 million to Clinton Foundation initiatives. ..."
"... The report comes on top of other far more incriminating investigations revealing the appearance of quid pro quo with foreign donors to the Clinton Foundation. Perhaps the worst example was when investors who profited from the Clinton State Department's approval of a deal for Russia's atomic energy agency's acquisition of a fifth of America's uranium mining rights subsequently pumped money into the Clinton Foundation. ..."
"... I hate to say this but the Clintons are America's version of Russian Oligarchs - and their Foundation almost a glorified form of money laundering. I can only pray that in 2020, us Dems may find a better president ,and that the Clintons be soon forgotten. ..."
"... Without seeing the 30,000 deleted emails, how is anyone qualified to say no laws were broken? Besides, who cares what the chief ethics lawyer for a president who authorized torture thinks? ..."
Aug 31, 2016 | The New York Times

This is not the typical foundation funded by family wealth earned by an industrialist or financier. This foundation was funded almost entirely by donors, and to the extent anyone in the Clinton family "earned" the money, it was largely through speaking fees for former President Bill Clinton or Hillary Clinton when she was not secretary of state. This dependence on donations - a scenario remarkably similar to that of many political campaigns - means that the motivations of every single donor will be questioned whenever a President Clinton does anything that could conceivably benefit such donors.

... ... ...

This kind of access is the most corrupting brand of favoritism and pervades the entire government. Under both Republican and Democratic presidents, top ambassadorial posts routinely go to campaign contributors. Yet more campaign contributors hound these and other State Department employees for introductions abroad, preferred access and advancement of trade and other policy agendas. More often than not the State Department does their bidding.

... ... ...

The problem is that it does not matter that no laws were broken, or that the Clinton Foundation is principally about doing good deeds. It does not matter that favoritism is inescapable in the federal government and that the Clinton Foundation stories are really nothing new. The appearances surrounding the foundation are problematic, and it is and will be an albatross around Mrs. Clinton's neck.

... ... ...

As for Chelsea Clinton, anti-nepotism laws, strengthened after President Kennedy appointed his brother Robert as attorney general, could prevent her mother from appointing her to some of the highest government positions. But she could give her mother informal advice, and there are a great many government jobs for which she would be eligible. She does not need the Clinton Foundation to succeed in life.

Richard W. Painter, a professor of law at the University of Minnesota, was the chief White House ethics lawyer from 2005 to 2007.

Majortrout, is a trusted commenter Montreal 2 days ago

"When I was the chief White House ethics lawyer for President George W. Bush," You knew exactly where this article was going once you read the first 14 words.

chichimax, albany, ny 2 days ago

I have a hard time focusing on this article. The author was chief ethics lawyer for the George W. Bush Administration. Why does that bother me? I realize this guy's term was from 2005 to 2007 and the Abu Ghraib story pretty much broke in early 2005, but, thinking about those other lawyers for that Bush and what they said was okay, it really gives me the creeps to think about focusing on anything this guy might say about ethics. Just sayin'.

Lori, San Francisco 2 days ago

How much did the Clinton campaign pay for this Op-Ed? 'Every one does it' and 'it's not illegal'. 'It's how business is done.' How about doing a real in-depth investigation on the Clinton Foundation and perceived favors to donors NYT, instead of more opinion?

If the foundation is so squeaky clean there should be no problem. Or has Hilary made it clear you won't get a front row seat at her next mythical press conference? Or has she threatened to stop sending you the press releases from her campaign you report as news?

Ange, Boston 2 days ago

Clearly a planted article. Nice try. Is everyone aware that the Foundation paid off Clinton's '08 campaign debt? They gave $400,000 and considered "payment for the campaign's mailing lists"

Crabby Hayes, Virginia 2 days ago

According to former Justice Department Deputy Assistant Attorney General Shannen Coffin, there are at least three different categories of federal laws which may be implicated.

One, the ethics and government act, which says you can't use a public office for private gain for yourself or even for a charity. So in giving special access to the donors for the Clinton Foundation, the ethics and government act is implicated. So perhaps Mr. Painter is a bit hasty dismissing such claims.

Randy, Largent 2 days ago

If it was only about getting a government post or an arranged meeting, I would agree. But this seems different because significant amounts of money changed hands as a result of State Department intervention. And a lot of that money ended up at the Foundation or as speaking fees to Bill Clinton. How is this not seen as foreign donations effecting an American election - which I believe is illegal.

Isa Ten, CA 2 days ago

Mr. Painter: You say "There is little if any evidence that federal ethics laws were broken by Mrs. Clinton". So if there is even "little" evidence that the laws were broken, then shouldn't American electorate consider it when making their election day decisions?

You did not mention that there was no independent investigation on this subject, so there is no way to know whether there was "little" or "significant" or "overwhelming" evidence that the laws were broken.

Your main argument is that "everyone" does that. Perhaps, it is time to change that and Trump is the man who can do it. Is it fear of this kind of change that frightens so many NeverTrumpsters into rejecting him?

And finally, even if the written laws were not broken, what about the immorality of what Clintons did? Has morality been completely removed from the public square in this once great country?

David Keltz, Brooklyn 2 days ago

If there was no evidence of corruption at the Clinton Foundation, then why did Bill Clinton's speaking fees increase astronomically (from roughly $100,000 to $850,000) during Hillary's tenure at the State Department?

Did he suddenly become more sought after, nearly 8 or 9 years after his presidency? If there was no evidence of corruption, then why did Hillary Clinton use her authority to appoint herself onto the Haiti Relief Fund Board, where her sole relief efforts entailed asking people not to donate to the Red Cross, but to the Clinton Foundation?

John D., Out West 2 days ago

One thing that comes through loud & clear in the comments: a lot of people don't have a clue how non-profit organizations work. For a sector that's responsible for most of the good things in this country these days - as the neocons and neolibs in power withdraw from the govt's former "general welfare" Constitutional role and concentrate on enriching themselves and their friends - it would pay for citizens to become more aware of how the sector works.

James Lee, Arlington, Texas August 31, 2016

The framers of our Constitution had no illusions about the weaknesses of human nature. They carefully crafted our charter of government to pit the officials of each branch against each other, to obstruct the kind of collusion that could undermine the foundations of a free society.

Despite their best efforts, however, the system they devised inevitably empowers some groups more than others. Since democratic theory defines government officials as representatives of the voters, it encourages constituents to influence the decisions of those agents. Ideally, politicians should not favor the interests of some groups over others, but reality dictates otherwise.

In the contest for influence, money inevitably plays a major, although not always decisive, role. In an effort to limit this role, we have developed both formal and informal methods to constrain human greed. The law prohibits bribery, for example. To discourage subtler forms of influence-buying, we have developed codes of ethics that pressure officials to limit financial connections with groups or individuals who might seek their help.

Public opinion can serve as a powerful tool to enforce these codes. This explains the informal requirement that a president divest herself of financial connections that might affect her decisions. If Clinton rejects this tradition, she will undermine an important method of limiting the influence of moneyed interests in government. We have too few such tools as it is.

confetti, MD August 31, 2016

I don't think that favoritism in political life will ever go away, for the simple reason that political power isn't attained in a vacuum. It requires sturdy alliances by definition, and those are forged via exchange of valued items - material goods, policy compromises, position, status, assistance and other durable support. Our laws are relatively stringent and prevent the crassest forms of corruption, and our culture makes lesser but legal offenses dangerous politically. But to imagine that any government, anywhere, could function without either those sorts of alliances or some equally corruptible strongman central oversight is is as naive and dangerously idealistic.

Of course the Clintons wheeled and dealed - but well within the law.

I'm more interested in what end that served and the real consequences than the fact that it occurred. In their case, an effective charity that aided many very vulnerable people was sustained, and no demonstrable compromises that negatively affected global policies occurred.

It's the Republicans and truly sold out Democrats, who have forever been deep in the pocket of big money and whose 'deals' in that department cause tangible harm to the populace, that I'm more concerned with. This is their smoke and mirrors show.

Alexander K., Minnesota August 31, 2016

How would someone feel if they found out that a doctor who prescribed them a medication is also paid large sums by a pharmaceutical company to promote the drug? Or, if the doctors owns substantial amount of stock in the company? Appearances do matter and it is likely that such conflicts do impact judgement. These kinds of allowances are being cleaned up across the country, at least in medicine.

It is time that conflict of interest for politicians at all levels is taken seriously by the public. I am fine if they get higher salaries, but it is time to clean up the political corruption and crony capitalism. It is a shame that we hold our politicians to such incredible low standards and it is not a surprise that so many people don't bother to vote.

Great editorial.

Michael Belmont, Hewitt, New Jersey 2 days ago

It doesn't matter how good or bad the work of the Clinton Foundation is. That is not the question. The question is the motivation of many who contribute to the foundation. Are they motivated by altruism or is donating in a big way a ploy to gain access to Mrs. Clinton. The AP analysis suggests that is just what went on. At the very least it looks bad. Appearances are everything in politics.

Hillary doesn't need to appear to be unethical should she be elected. Bad enough she has Bill by her side. She doesn't need a special prosecutor investigator distracting her presidency with an influence peddling scandal. Like it or not, Republicans will be hunting for her political hide. Hillary doesn't need to paint a bulls-eye for them.

Chris, 10013 2 days ago

I doubt that Clinton breached a fundamental legal boundary. However, the Clinton's have always seen the bright line and have decided to test the boundaries. From using police to secure women while governor to taking money from Walmart to major financial institutions to the email scandal, the Clinton's do it again and again and blame a vast right wing conspiracy. The Clinton foundation used Doug Band as a bag man securing commercial contracts for Bill and Hilary while he had a senior role at the foundation (flashing red lights). Huma took money off the state department books as did other Clinton confidants (flashing red lights), etc. They can't help themselves. Are these actives illegal? Probably not. However, we seek to be inspired by our leaders, we want leaders who are better than the average, better than us.

In the Clintons, we have highly competent, experienced, politicians who have repeated shown deep ethical problems. She is the best candidate by far. It's unfortunate that our future President never learned what ethics are.

Robert, Minneapolis 2 days ago

An interesting article. It is probably true that many, if not most, politicians are influence sellers to a degree. I suspect that the Clintons are just better at it. It is fair to say that we do not know if laws have been broken. But it is also fair to say that appearances matter, and that the Clintons are very good at lining their own pockets at the same time the foundation does it's good work.

When Bill can trot off to Russia, get 750k for a speech at the same time that business interests of the donor is before the State Department, it smells. The crux of the matter is the rotten judgement.

You want a POTUS who has good judgement. The relentless chasing of a buck mixed with the appearance of impropriety, real or imagined, is the problem. When mixed with her poor judgement on the emails and her poor judgement on invading Iraq and disrupting Libya, you have a problem which explains her low approval rating. She is just fortunate that she has Trump to run against.

Madelyn Harris, Portland, OR 2 days ago

So glad to see many NYT readers here recognize the hypocrisy in this opinion piece. The message is "All of them do it, it's mostly legal, though it's distasteful and problematic. However, Hillary is the only one who should stop doing it because it looks bad."

The loudest voices of this partisan attack should be under the same scrutiny and be compelled to practice what they preach. If we look back to the Bill Clinton and Monica Lewinsky scandal, those that were screaming the loudest for justice were having extramarital affairs during the "investigation". Newt Gingrich, Bob Livingston, Henry Hyde. And then there was Dennis Hastert.

Let's start looking into the personal emails of Paul Ryan, Jason Chaffetz, Donald Trump, Trey Gowdy, Marco Rubio, Ted Cruz. Imagine what we would find! Legal, but ethically problematic exchanges and clearly illegal exchanges that would justify imprisonment. If they ask for justice, we should provide it.

Lori, San Francisco 2 days ago

You bring up yet another problem with Hilary. She has covered for her sexual predator husband for decades, including harassing and publicly shaming her husband's sexual assault victims. And there are many going back to his Oxford days. How is that ok?

John D., Out West 2 days ago

An excellent piece, actually tethered to reality and non-profit law and practice ... finally! Yes, all the Clinton clan needs to divorce themselves from the foundation, and I'm not sure why they would wait until after the election to do so.

It seems the loudest critics are of the tribe that created campaign finance law as it stands today, with the CU case having created a legal system of bribery across the board in government. C'mon guys, be consistent, or it's the big H word for you!

RNW, Albany, CA 2 days ago

When it comes to ethics and public officials, appearances do in indeed MATTER! Cronyism and conflicts of interest might elicit a big yawn from the political class, their fellow travelers and camp followers but arouse anger and indignation from voters. Remember those guys?

We're the ones that politicians suddenly remember every few years with they come. hats in hand, begging for donations and, most of all, our votes. (The plea for donations is a farce. Except for a few outliers, they don't really need or want OUR donations.)

The Trumpster won the Republican nomination precisely because of voter disgust over the in-crowd culture of politicians and donors. Bernie Sanders came close to winning the Democratic nomination for much of the same reason. Hilary and her entire family need to wake up fast if she has any hope or desire to get elected. We all know where Hilary's money is coming from. Does Hilary know where her voters are coming from and where they are now?

Tembrach, Connecticut 2 days ago

I preface this by saying that I am proud Democrat & will vote for Mrs. Clinton, as Mr. Trump is beyond the pale of decency

To put this in a nutshell, The Clinton's self-enriching behavior- and use of public office for private gain - is troubling in the extreme

During her tenure as Secretary of State (as reported by the AP) of the 154 non-official meetings at least 85 of those individuals were private-sector donors who contributed up to $156 million to Clinton Foundation initiatives.

The report comes on top of other far more incriminating investigations revealing the appearance of quid pro quo with foreign donors to the Clinton Foundation. Perhaps the worst example was when investors who profited from the Clinton State Department's approval of a deal for Russia's atomic energy agency's acquisition of a fifth of America's uranium mining rights subsequently pumped money into the Clinton Foundation.

Mrs Clinton rightly condemns Trump for playing footsy with Putin. But pray tell, what exactly was this?

I hate to say this but the Clintons are America's version of Russian Oligarchs - and their Foundation almost a glorified form of money laundering. I can only pray that in 2020, us Dems may find a better president ,and that the Clintons be soon forgotten.

Thought Bubble, New Jersey 2 days ago

Without seeing the 30,000 deleted emails, how is anyone qualified to say no laws were broken? Besides, who cares what the chief ethics lawyer for a president who authorized torture thinks?

[Sep 03, 2016] At the Clinton Foundation, Access Equals Corruption

Sep 02, 2016 |

More than half of the people who managed to score a personal one on one meeting with Hillary Clinton while she was Secretary of State donated money to the Clinton Foundation, either as an individual or through a company where they worked. "Combined, the 85 donors contributed as much as $156 million. At least 40 donated more than $100,000 each, and 20 gave more than $1 million," the Associated Press reported.

Does that make Hillary corrupt? Yes. It does.

At this writing, there is no evidence that anyone received any special favors as a result of their special access to Clinton. Not that treats were not requested. They were. (The most amusing was Bono's request to stream his band's music into the international space station, which was mercifully rejected.)

That's irrelevant. She's still corrupt.

Clinton's defenders like to point out that neither she nor her husband draw a salary from their foundation. But that's a technicality.

The Clintons extract millions of dollars in travel expenditures, including luxurious airplane accommodations and hotel suites, from their purported do-gooder outfit. They exploit the foundation as a patronage mill, arranging for it to hire their loyalists at extravagant six-figure salaries. Charity Navigator, the Yelp of non-profits, doesn't bother to issue a rating for the Clinton foundation due to the pathetically low portion of money ($9 million out of $140 million in 2013) that makes its way to someone who needs it.

"It seems like the Clinton Foundation operates as a slush fund for the Clintons," says Bill Allison of the Sunlight Foundation, a government watchdog group.

As a measure of how institutionally bankrupt American politics is, all this crap is technically legal. But that doesn't mean it's not corrupt.

Public relations experts caution politicians like the Clintons that the appearance of impropriety is almost as bad as its actuality. If it looks bad, it will hurt you with the polls. True, but that's not really the point.

The point is: access is corruption.

It doesn't matter that the lead singer of U2 didn't get to live out his rocker astronaut fantasy. It's disgusting that he was ever in a position to have it considered. To put a finer point on it, ethics require that someone in Hillary Clinton's position never, ever take a meeting or correspond by email or offer a job to someone who donated money to her and her husband's foundation. Failure to build an unscalable wall between government and money necessarily creates a corrupt quid pro quo:

"Just got a call from the Clinton Foundation. They're shaking us down for a donation. Should we cough up a few bucks?"

"Hillary could be president someday. Chelsea could end up in the Senate. It couldn't hurt to be remembered as someone who threw them some money when they asked."

This, I 100% guarantee you, was the calculus when Wall Street firms like Goldman Sachs paid hundreds of thousands of dollars to Hillary for a one- or two-hour speech. She doesn't have anything new to say that everyone hasn't already heard million times before. It's not like she shared any valuable stock tips during those talks. Wealthy individuals and corporations pay politicians for one thing: access.

Ted Rall, syndicated writer and the cartoonist for ANewDomain.net, is the author of the book "Snowden," the biography of the NSA whistleblower.

[Sep 02, 2016] HRC: "The Great Graspy"

Sep 02, 2016 | www.nakedcapitalism.com

curlydan , September 2, 2016 at 3:52 pm

HRC: "The Great Graspy"

OpenThePodBayDoorsHAL , September 2, 2016 at 4:16 pm

Good question, this NC reader is just pretty fed up with the status quo (maybe others want to chime in):
– Unlimited immunity from prosecution for banking executive criminals
– More shiny new undeclared "nation-building" and "RTP" wars
– Globalist trade deals that enshrine unaccountable corporate tribunals over national sovereignty, environmental and worker protection, and self-determination
– America's national business conducted in secrecy at the behest of corporate donors to tax-exempt foundations
– Paid-for quid-pro-quo media manipulation of candidate and election coverage
– Health care system reform designed to benefit entrenched insurance providers over providing access to reasonable-cost basic care.
Based on the above I'd say the 11:2 ratio looks about right.

Reply
Skippy , September 2, 2016 at 4:18 pm

When did neoliberalism become center left – ?????

[Sep 02, 2016] The Foundation is a tool to provide wealthy worthy individuals, groups, corporations, nations an expedited access to the government official, in this case Hillary

Sep 02, 2016 | www.nakedcapitalism.com
Marco , September 2, 2016 at 2:48 pm

Really enjoyed Atrios easy-breezy summation of Clinton Foundation / State Department skullduggery…

"…a bit unseemly in that way that the sausage factory is a bit gross, but it basically seems to fall in 'this is how things work' territory as far as I can tell…"

Pat , September 2, 2016 at 3:02 pm

Breezy is right. It does lead me to ask if this were not the Clinton Foundation but was the Bush Foundation or the Rubio Foundation or…would this still be just be the way things work? I do not think so.

Don't get me wrong I have great admiration for Atrios (he is right on the money regarding Social Security and self-driving cars), but the double standard where both Obama and Clinton are concerned is strong at Eschaton, and I'm sorry to say with him as well.

Accepting this as the way things work is just accepting that corruption is the norm and there is nothing to be done about it. So unless you are willing to shut up about supposed misdeeds of all elected officials and political candidates because this is the way it is done, you need to get the f*ck over the idea that this is NORMAL and ACCEPTABLE.

And I don't see that happening over there, or at Daily Kos, or… once the subject is out is out of the tribe.

Kurt Sperry , September 2, 2016 at 3:43 pm

I can understand the "it's OK when our people do it" double standard. Family/tribe/team, we are all trained to do that. What I don't understand is how one could ever arrive at Clinton Foundation = our people prerequisite to applying it in this instance. WT actual F?

Pat , September 2, 2016 at 3:52 pm

I think you are coming at this from far too realistic a point of view. You aren't looking at this as the Foundation is a tool, like a speech or a fundraiser, in order to provide wealthy worthy individuals/groups/corporations/nations a means to expedite access to the government official, in this case Clinton. You think of it as a false charity. But for the greasing the wheels is normal operating procedure, what this was was a gift to open more avenues for the wheels to be greased. It's up to you…or me…or even the people of Flint among others to use that opportunity.

Just saying.

timbers , September 2, 2016 at 3:45 pm

Yes. And this too:

Breezy is right. It does lead me to ask if this were not the Clinton War With Russia but was the Bush War With Iraq or the Rubio War With Syria or…would this still be just be the way things work? I do not think so.

Don't get me wrong I have great admiration for Atrios (he is right on the money regarding Social Security and self-driving cars), but the double standard where both Obama and Clinton are concerned is strong at Eschaton, and I'm sorry to say with him as well.

Accepting this as the way things work is just accepting that endless and new wars is the norm and there is nothing to be done about it. So unless you are willing to shut up about supposed endless new wars of all elected officials and political candidates because this is the way it is done, you need to get the f*ck over the idea that this is NORMAL and ACCEPTABLE.

And I don't see that happening over there, or at Daily Kos, or… once the subject is out is out of the tribe.

pretzelattack , September 2, 2016 at 4:40 pm

yeah, very well said. tammany hall, just the way things are done. jim crow laws, just the way things are done. endless etc's.

[Sep 02, 2016] 40 pieces of evidence that "the Clinton Foundation is not just a fraud, it's a massive fraud

Sep 02, 2016 | www.nakedcapitalism.com
aliteralmind , September 2, 2016 at 2:13 pm

I had the pleasure of interviewing Charles Ortel yesterday:

Charles Ortel: 40 days, 40 pieces of evidence that "the Clinton Foundation is not just a fraud, it's a massive fraud"

Jim Haygood , September 2, 2016 at 2:37 pm

"Bill Clinton wrote a book in 2007 called 'Giving' [for which he was paid $6.3 million]."

Give and ye shall receive, as the pious "Bill" is wont to say. /sarc

grayslady , September 2, 2016 at 5:55 pm

Excellent interview. I've bookmarked Ortel's website and am looking forward to his forthcoming writings. I was not aware of the differences between laws regulating charities versus other forms of organizations, so the interview as a starting point was very useful for me.

[Aug 29, 2016] Reince Priebus Demands Public Release of All Communications Between Clinton Foundation and State Department

www.breitbart.com

Breitbart

Hillary Clinton's pay-for-play scandal is threatening to derail her campaign. Public outrage follows revelations that the Foundation took foreign cash during Clinton's tenure as Secretary of State, that Clinton aide Huma Abedin was helping Foundation donors get favors and access from the State Department, and that Clinton aide Cheryl Mills was doing assignments for the Clinton Foundation while on the State Department payroll.

In a letter Monday to Foundation president Donna Shalala, Priebus demands transparency.

"I am writing to you to call on the Clinton Foundation and all of the entities under its umbrella to release all correspondence its officials had with the State Department during Hillary Clinton's tenure as secretary of state," Priebus added.

As I am sure you are well aware, a spate of recent news reports involving the Clinton Foundation's relationship with the Clinton State Department has renewed serious concerns about conflicts of interest and whether donors to the foundation benefitted from official acts under then-Secretary Clinton.

[Aug 29, 2016] Why Did Saudi Regime Other Gulf Tyrannies Donate Millions to Clinton Foundation?

"It isn't just "suspicious." It's influence peddling, which is corrupt by definition. And there's a whole infrastructure, institutional and technical, to support it." Lambert Strether of Corrente.
Notable quotes:
"... here you have Hillary Clinton and Bill Clinton having this Clinton Foundation, with billions of dollars pouring into it from some of the world's worst tyrannies ..."
"... Bill and Hillary Clinton are being personally enriched by those same people, doing speeches, for many hundreds of thousands of dollars, in front of them, at the same time that she's running the State Department, getting ready to run for president, and soon will be running the executive branch. ..."
"... the problem here is that the Clintons have essentially become the pioneers of eliminating all of these lines, of amassing massive wealth from around the world, and using that to boost their own political power, and then using that political power to boost the interests of the people who are enriching them in all kinds of ways. ..."
Aug 29, 2016 | Democracy Now!

[W]hat Donna Brazile said in that video that you played is nothing short of laughable. It's not questioned when Republicans do favors for their donors? Of course it is. In fact, it's been a core, central critique of the Democratic Party, both Barack Obama and Hillary Clinton, for years, that Republicans are corrupt because they serve the interest of their big donors. One of the primary positions of the Democratic Party is that the Citizens United decision of the Supreme Court has corrupted politics because it allows huge money to flow into the political process in a way that ensures, or at least creates the appearance, that people are doing favors for donors.

And so, here you have Hillary Clinton and Bill Clinton having this Clinton Foundation, with billions of dollars pouring into it from some of the world's worst tyrannies, like Saudi Arabia and the United Arab Emirates and Qatar and other Gulf states, other people who have all kinds of vested interests in the policies of the United States government. And at the same time, in many cases, both Bill and Hillary Clinton are being personally enriched by those same people, doing speeches, for many hundreds of thousands of dollars, in front of them, at the same time that she's running the State Department, getting ready to run for president, and soon will be running the executive branch.

And so, the problem here is that the Clintons have essentially become the pioneers of eliminating all of these lines, of amassing massive wealth from around the world, and using that to boost their own political power, and then using that political power to boost the interests of the people who are enriching them in all kinds of ways. And of course questions need to be asked, and suspicions are necessarily raised, because this kind of behavior is inherently suspicious. And it needs a lot of media scrutiny and a lot of attention, and I'm glad it's getting that.

[Aug 29, 2016] Justice Stevens dissent in Citizens United (via @ggreenwald ) shreds the central argument of Hillarys defenders

Notable quotes:
"... On numerous occasions we have recognized Congress' legitimate interest in preventing the money that is spent on elections from exerting an "'undue influence on an officeholder's judgment"' and from creating "4he appearance of such influence,"' beyond the sphere of quid pro quo relationships. I ..."
"... Corruption can take many forms. Bribery may be the paradigm case. But the difference between selling a vote and selling access is a matter of degree, not kind. And selling access is not qualitatively different from giving special preference to those who spent money on one's behalf. ..."
"... Corruption operates along a spectrum, and the majority's apparent belief that quid pro quo arrangements can be neatly demarcated from other improper influences docs not accord with the theory or reality of politics. ..."
www.nakedcapitalism.com
On numerous occasions we have recognized Congress' legitimate interest in preventing the money that is spent on elections from exerting an "'undue influence on an officeholder's judgment"' and from creating "4he appearance of such influence,"' beyond the sphere of quid pro quo relationships. Id., at 150; see also. e.g., id., at 143-144. 152-154; Colorado II, 533 U. S.. at 441; Shrink Missouri. 528 U. S., at 389.

Corruption can take many forms. Bribery may be the paradigm case. But the difference between selling a vote and selling access is a matter of degree, not kind. And selling access is not qualitatively different from giving special preference to those who spent money on one's behalf.

Corruption operates along a spectrum, and the majority's apparent belief that quid pro quo arrangements can be neatly demarcated from other improper influences docs not accord with the theory or reality of politics.

It certainly does not accord with the record Congress developed in passing BCRA. a record that stands as a remarkable testament to the energy and ingenuity with which corporations, unions, lobbyists, and politicians may go about scratching each other's backs - and which amply supported Congress' determination to target a limited set of especially destructive

[Aug 29, 2016] If Clinton gets elected, she will be under investigation prior to the inauguration.

Notable quotes:
"... Hillary will win, and it will be more than business as usual. Influence peddling and pay to play will accelerate. The neocon money will flow into the system and foreign policy will be a debacle. We may very well be approaching WWIII. ..."
"... Under a Clinton II presidency, long-term international turmoil and confrontation lie ahead no matter what their family foundation may attempt to achieve. ..."
Aug 28, 2016 | www.theamericanconservative.com

Scott in MD , August 26, 2016 at 6:20 am

If Clinton gets elected, she will be under investigation prior to the inauguration. The Republicans will use their hold on the house to start several investigations on November 9.

However, the GOP (continuing a party tradition) will cruise right past several true issues, and lock onto the one thing they believe will hold the most shock value. This will turn out to not be provable, or not be all that interesting to anyone but die-hard GOP supporters, and she will exit the investigations as powerful, if not more so, than before.

There are plenty of reasons to investigate the Clinton machine, but if you expect this clown show to do it competently I have a bridge to sell you…

collin , August 26, 2016 at 9:47 am
No this one is backfiring already as most of the donors were people HRC would have met anyway, including Nobel Peace winners! and the 89 out of 154 people has not been released. And the article does not note any mischief but that there were meetings!

Or that there are a ton of other government officials have spouses that run well run charities. Matt Yglesias has de-bunked this one a lot and my guess disappears relatively quickly.

This is as worthless evidence as Michael Moore's Fahrenheit 9/11.

Johann , says: August 26, 2016 at 9:50 am

Hillary will win, and it will be more than business as usual. Influence peddling and pay to play will accelerate. The neocon money will flow into the system and foreign policy will be a debacle. We may very well be approaching WWIII.

The economy will continue to hollow out due to central bank hubris, government stimulus, and non-free trade deals. Income inequality will get worse. The middle class will continue to shrink.

We are well on our way to third world status.

Samuel Hooper , says: August 26, 2016 at 1:06 pm
After leaving office, Bill Clinton could have devoted his energies to Habitat for Humanity (like Jimmy Carter) or thrown his energies into helping an existing organisation (like the Bill & Melinda Gates foundation). He didn't, because he wanted the "fruits" of his philanthropic work to accrue to him and his family. And so it is not unreasonable to ask exactly what those fruits are, especially those gained while Hillary Clinton was serving as the nation's chief diplomat.
Steve Thompson \, says: August 26, 2016 at 2:41 pm
Here is an article that quite succinctly explains, in her own words, Hillary Clinton's views of America's role in the world:
http://viableopposition.blogspot.ca/2016/08/rebuilding-globe-in-hillary-clintons.html

Under a Clinton II presidency, long-term international turmoil and confrontation lie ahead no matter what their family foundation may attempt to achieve.

[Aug 29, 2016] Clinton under new threat as email woes and foundation questions merge by David UsborneF:\Private_html\author.txt

independent.co.uk

The two sources of her problems are beginning to merge much as two weather depressions might collide and become a hurricane. One is the already well-trodden matter of her use of a private email server while Secretary of State. The other relates to the Clinton Foundation and whether donors received preferential access to her while she served in that post.

Two bombs dropped on the Clinton campaign at once on Monday. First it emerged that the FBI has collected and delivered to the State Department almost 15,000 new emails not previously seen and a federal judge ordered the department to accelerate their release to the public. Meanwhile, a conservative group called Judicial Watch released details of still more emails detailing exactly how donors to the foundation set about trying to get Ms Clinton's attention.

... ... ...

Questions have been swirling for weeks about whether or not Ms Clinton was drawn into giving special favours to some of her husband's pals in return for their giving generously to the charitable foundation he set up after leaving the presidency – a pay and play arrangement. On Monday, Judicial Watch unveiled details that showed exactly how that might have happened thanks to emails it had accessed through the courts sent to and from Huma Abedin, a close Clinton confidante and her deputy chief of staff during her four years at the State Department.

... ... ...

In attempt to forestall the trouble that is already upon his wife, Mr Clinton announced this week that should she win the presidency, several things will change at his Foundation. First and foremost it would cease to take money from any foreign governments and donors and only from US-based charities and individuals. He would also step down from the foundation entirely and cease personally to raise funds for it.

...many voters are simply afraid that with Ms Clinton in the White House the whole tawdry cycle will just start all over again and nothing else with get done in Washington

[Aug 29, 2016] Hillary Clinton pushes fundraising limits with $200,000 tickets for single Silicon Valley house party

independent.co.uk

It was only one in a long parade of late-August fundraisers Ms Clinton has attended, but it stands out for the generosity required of those who attended. The price of admission for the 20-odd guests who obliged was a stunning $200,000. That was double the $100,000 charged for guests who mingled recently with Ms Clinton in Omaha at the home of Susan Buffett, the daughter of Warren Buffett, the veteran investment oracle.

... ... ...

As of Monday, she and Mr Kaine had harvested no less than $32 million for the Hillary Victory Fund, which will be distributed to her campaign, the Democratic National Committee and state parties. A lot of was raised in last week as Ms Clinton hopscotched from party to party on Martha's Vineyard and Cape Code in Massachusetts.

[Aug 27, 2016] Artists Impression Of Hillary Clintons Old Office

Notable quotes:
"... Source: MichaelPRamirez.com ..."
www.zerohedge.com

Presented with no comment...

Source: MichaelPRamirez.com

Here2Go d nmewn •Aug 27, 2016 8:37 PM
Is that Huma in a blue dress under the Resolute desk?
Pairadimes d Here2Go •Aug 27, 2016 9:14 PM
Ramirez is a genius.
zeronetwork d debtor of last resort •Aug 27, 2016 8:15 PM

The thought process Donald has started is not going to fade very soon. Still few weeks before election. I am sure Donald got some more cards in his sleeve.
are we there yet •Aug 27, 2016 8:36 PM
I have a solution for Hillary's in-continuance and mobility declining problems. The chair behind the presidents desk should be a wheelchair with a bedpan. Otherwise the term 'campaign trail' will take on a whole new meaning.

[Aug 26, 2016] Lots of Smoke Here, Hillary

Notable quotes:
"... If Hillary Clinton wins, within a year of her inauguration, she will be under investigation by a special prosecutor on charges of political corruption, thereby continuing a family tradition. ..."
"... Of 154 outsiders whom Clinton phoned or met with in her first two years at State, 85 had made contributions to the Clinton Foundation, and their contributions, taken together, totaled $156 million. ..."
"... Conclusion: access to Secretary of State Clinton could be bought, but it was not cheap. Forty of the 85 donors gave $100,000 or more. Twenty of those whom Clinton met with or phoned dumped in $1 million or more. ..."
"... On his last day in office, January 20, 2001, Bill Clinton issued a presidential pardon to financier-crook and fugitive from justice Marc Rich, whose wife, Denise, had contributed $450,000 to the Clinton Library. ..."
Aug 26, 2016 | www.theamericanconservative.com

Prediction: If Hillary Clinton wins, within a year of her inauguration, she will be under investigation by a special prosecutor on charges of political corruption, thereby continuing a family tradition.

... ... ...

Of 154 outsiders whom Clinton phoned or met with in her first two years at State, 85 had made contributions to the Clinton Foundation, and their contributions, taken together, totaled $156 million.

Conclusion: access to Secretary of State Clinton could be bought, but it was not cheap. Forty of the 85 donors gave $100,000 or more. Twenty of those whom Clinton met with or phoned dumped in $1 million or more.

To get to the seventh floor of the Clinton State Department for a hearing for one's plea, the cover charge was high. Among those who got face time with Hillary Clinton were a Ukrainian oligarch and steel magnate who shipped oil pipe to Iran in violation of U.S. sanctions and a Bangladeshi economist who was under investigation by his government and was eventually pressured to leave his own bank.

The stench is familiar, and all too Clintonian in character.

Recall. On his last day in office, January 20, 2001, Bill Clinton issued a presidential pardon to financier-crook and fugitive from justice Marc Rich, whose wife, Denise, had contributed $450,000 to the Clinton Library.

The Clintons appear belatedly to have recognized their political peril.

Bill has promised that, if Hillary is elected, he will end his big-dog days at the foundation and stop taking checks from foreign regimes and entities, and corporate donors. Cash contributions from wealthy Americans will still be gratefully accepted.

One wonders: will Bill be writing thank-you notes for the millions that will roll in to the family foundation-on White House stationery?

[Aug 21, 2016] Ukraine Releases More Details on Payments for Trump Aide, Paul Manafort

What a bunch of neoliberal piranha, devouring the poorest country in Europe, where pernneers exist on $1 a day or less, with the help of installed by Washington corrupt oligarchs (Yanukovich was installed with Washington blessing and was controlled by Washington, who was fully aware about the level of corruption of its government; especially his big friend vice-president Biden).
Notable quotes:
"... Mr. Kalyuzhny was also a founding board member of a Brussels-based nongovernmental organization, the European Center for a Modern Ukraine, that hired the Podesta Group, a Washington lobbying firm that received $1.02 million to promote an agenda generally aligned with the Party of Regions. ..."
"... Because the payment was made through a nongovernmental organization, the Podesta Group did not register as a lobbyist for a foreign entity. A co-founder of the Podesta Group, John D. Podesta, is chairman of Hillary Clinton's campaign, and his brother, Tony Podesta, runs the firm now. ..."
"... The Podesta Group, in a statement, said its in-house counsel determined the company had no obligation to register as a representative of a foreign entity in part because the nonprofit offered assurances it was not "directly or indirectly supervised, directed, controlled, financed or subsidized in whole or in part by a government of a foreign country or a foreign political party." ..."
"... On Monday, Mr. Manafort issued a heated statement in response to an article in The New York Times that first disclosed that the ledgers - a document described by Ukrainian investigators as an under-the-table payment system for the Party of Regions - referenced a total of $12.7 million in cash payments to him over a five-year period. ..."
"... In that statement, Mr. Manafort, who was removed from day-to-day management of the Trump campaign on Wednesday though he retained his title, denied that he had personally received any off-the-books cash payments. "The suggestion that I accepted cash payments is unfounded, silly and nonsensical," he said. ..."
Aug 18, 2016 | The New York Times

MOSCOW - The Ukrainian authorities, under pressure to bolster their assertion that once-secret accounting documents show cash payments from a pro-Russian political party earmarked for Donald J. Trump's campaign chairman, on Thursday released line-item entries, some for millions of dollars.

The revelations also point to an outsize role for a former senior member of the pro-Russian political party, the Party of Regions, in directing money to both Republican and Democratic advisers and lobbyists from the United States as the party tried to burnish its image in Washington.

The former party member, Vitaly A. Kalyuzhny, for a time chairman of the Ukraine Parliament's International Relations Committee, had signed nine times for receipt of payments designated for the Trump campaign chairman, Paul Manafort, according to Serhiy A. Leshchenko, a member of Parliament who has studied the documents. The ledger covered payments from 2007 to 2012, when Mr. Manafort worked for the party and its leader, Viktor F. Yanukovych, Ukraine's former president who was deposed.

Mr. Kalyuzhny was also a founding board member of a Brussels-based nongovernmental organization, the European Center for a Modern Ukraine, that hired the Podesta Group, a Washington lobbying firm that received $1.02 million to promote an agenda generally aligned with the Party of Regions.

Because the payment was made through a nongovernmental organization, the Podesta Group did not register as a lobbyist for a foreign entity. A co-founder of the Podesta Group, John D. Podesta, is chairman of Hillary Clinton's campaign, and his brother, Tony Podesta, runs the firm now.

The role of Mr. Kalyuzhny, a onetime computer programmer from the eastern Ukrainian city of Donetsk, in directing funds to the companies of the chairmen of both presidential campaigns, had not previously been reported. Mr. Kalyuzhny was one of three Party of Regions members of Parliament who founded the nonprofit.

The Associated Press, citing emails it had obtained, also reported Thursday that Mr. Manafort's work for Ukraine included a secret lobbying effort in Washington that he operated with an associate, Rick Gates, and that was aimed at influencing American news organizations and government officials.

Mr. Gates noted in the emails that he conducted the work through two lobbying firms, including the Podesta Group, because Ukraine's foreign minister did not want the country's embassy involved. The A.P. said one of Mr. Gates's campaigns sought to turn public opinion in the West against Yulia Tymoshenko, a former Ukrainian prime minister who was imprisoned during Mr. Yanukovych's administration.

The Podesta Group, in a statement, said its in-house counsel determined the company had no obligation to register as a representative of a foreign entity in part because the nonprofit offered assurances it was not "directly or indirectly supervised, directed, controlled, financed or subsidized in whole or in part by a government of a foreign country or a foreign political party."

Reached by phone on Thursday, a former aide to Mr. Kalyuzhny said he had lost contact with the politician and was unsure whether he remained in Kiev or had returned to Donetsk, now the capital of a Russian-backed separatist enclave.

Ukrainian officials emphasized that they did not know as yet if the cash payments reflected in the ledgers were actually made. In all 22 instances, people other than Mr. Manafort appear to have signed for the money. But the ledger entries are highly specific with funds earmarked for services such as exit polling, equipment and other services.

On Monday, Mr. Manafort issued a heated statement in response to an article in The New York Times that first disclosed that the ledgers - a document described by Ukrainian investigators as an under-the-table payment system for the Party of Regions - referenced a total of $12.7 million in cash payments to him over a five-year period.

In that statement, Mr. Manafort, who was removed from day-to-day management of the Trump campaign on Wednesday though he retained his title, denied that he had personally received any off-the-books cash payments. "The suggestion that I accepted cash payments is unfounded, silly and nonsensical," he said.

Mr. Manafort's statement, however, left open the possibility that cash payments had been made to his firm or associates. And details from the ledgers released Thursday by anticorruption investigators suggest that may have occurred. Three separate payments, for example, totaling nearly $5.7 million are earmarked for Mr. Manafort's "contract."

Another, from October 2012, suggests a payment to Mr. Manafort of $400,000 for exit polling, a legitimate campaign outlay.

Two smaller entries, for $4,632 and $854, show payments for seven personal computers and a computer server.

The payments do not appear to have been reported by the Party of Regions in campaign finance disclosures in Ukraine. The party's 2012 filing indicates outlays for expenses other than advertising of just under $2 million, at the exchange rate at the time. This is less than a single payment in the black ledger designated for "Paul Manafort contract" in June of that year for $3.4 million.

Ukrainian investigators say they consider any under-the-table payments illegal, and that the ledger also describes disbursements to members of the central election committee, the group that counts votes.


Correction: August 20, 2016

Because of an editing error, an article on Friday about the political activities in Ukraine of Donald J. Trump's former campaign chairman, Paul Manafort, misidentified the office once held by Yulia V. Tymoshenko, a rival of Mr. Manafort's client, the former president Viktor F. Yanukovych. Ms. Tymoshenko served as prime minister of Ukraine, not its president.

[Aug 01, 2016] Progressive Leaders Urge Voters To Wait To #DemExit Until After State Primaries

Notable quotes:
"... Progressives who are fed up with the Democratic leadership's adherence to the status quo are calling for a major #DemExit on July 29. ..."
www.inquisitr.com

Progressives who are fed up with the Democratic leadership's adherence to the status quo are calling for a major #DemExit on July 29. However, progressive groups, such as Black Men for Bernie, are urging voters to stay in the party until they have a chance to vote in their states' primaries, especially if they live in closed or semi-closed primary states.

Abstaining from #DemExit until after state and local primaries is especially important for Florida, which has a closed primary. On August 30, Professor and legal expert Tim Canova has a chance to unseat Democratic National Committee Chair Debbie Wasserman-Schultz, whose tenure as the head of the Democratic Party has been fraught with controversy and more recently, allegations of election fraud and rigging.

A mass exodus, therefore, could sabotage progressives' own agenda to elect officials who are challenging incumbents and establishment candidates. As of now, 23 states and territories have local and state primaries up until September 13, so it is imperative for current members of the Democratic party to stay until they've voted and then commit to #DemExit.

[Sep 27, 2015] Maria Zakharova, spokeswoman for Russian Foreign Ministry, grades Nuland's paper

September 16, 2015 | Fort Russ/Komsomolskaya Pravda

It is impossible to deal with cockroaches in one room while at the same time laying out little plates of bread crumbs on the other side of the wall.

Translated from Russian by Tom Winter

Translator's note: this press account is based on a post on Maria Zakharova's facebook page, and I have changed this account slightly in alignment with Zakharova's original text. It was not clear in KP what was Zakharova and what was KP. I think it is in this translation...

Head of the Information Department of the Russian Foreign Ministry wrote a "critical review" on the "Yalta speech" of the assistant US Secretary of State.

In Kiev, there was a conference "Yalta European Strategy". Already amazing. Yalta is in the Russian Crimea, and the "Yalta" conference was held in the Ukrainian capital. Well and good -- you couldn't miss that one!. But at this Yalta conference came the assistant US Secretary of State Victoria Nuland. Yes, the same one that passed out the cookies. But now, considered a shadow ruler of Ukraine, she points out to the Kiev authorities what to do. This time, Nuland said in a public speech:

- There should be no tolerance for those oligarchs who do not pay taxes. There must be zero tolerance for bribery and corruption, to those who would use violence for political ends.

And these words of the grande dame of the State Department could not be overlooked. Just think, Americans don't like it when their loans to Ukraine get stolen. And anti-oligarchic Maidan brought the very oligarchs to power, and corruption in the country has become even greater. Some of us have grown weary of this talk. But, let Nuland drone on ...

But then Russian Foreign Ministry official spokesman Maria Zakharova replied. So much so that not a stone was left on stone in the American's "Yalta speech":

"All this a little bit, just a little, looks like a lecture to the fox about how bad it is to steal chickens, but actually it surprised in other ways. As soon as Russian authorities began exposing the tax evasion, bribery, or corruption of the oligarchs, Victoria Nuland's office hastened to call zero tolerance "political repression" - Zakharova wrote on her facebook page.

It would be great to see the Department of State "show that same zero tolerance and inquire a bit about how the initial capital of the Russian (and Ukrainian would not hurt) oligarchs got started, those oligarchs who have been accused of corruption at home, but who, once in London, feel protected by the authorities, enjoying all the benefits of membership in the Club of Victims of Political Persecution" - continued Zakharova.

"It is impossible to deal with cockroaches in one room while at the same time laying out little plates of bread crumbs on the other side of the wall. Giving the green light to the dirty money from Russia and the former Soviet Union, the Western world is only boosting the zeal with which the domestic thieves shove their loot in foreign bins."

"Though perhaps," wonders the Foreign Minstiry spokesman "this is the actual purpose of the imaginary zero tolerance?"

"Why do people on Interpol's lists, by the decision of the Russian courts, prove their financial immorality, as they thrive in the Western capitals, and no alarm bells go off in the State Department?"

It turns out to be an interesting story: Taking fetid streams of notes, the West has just one requirement at the border crossing. Scream "victim of the regime." That's it! and you're in spades!

This calls to mind the old Soviet bribery password translated into modern American:

- In Soviet times, it was common phrase, revealing corrupt intent to proceed with plans insidious in varying degrees: "I'm from Ivan Ivanovich." Today the corresponding "Open Sesame" that opens the doors "in Europe and the best houses in Philadelphia," is the phrase "I'm running away from Vladimir".

Victoria, if you're going to start cleaning out the cockroaches, stop feeding them on your side.

[Jul 15, 2015] When connected turns into corrupted

Los Angeles Times

CRONY CAPITALISM is the name of the Republican game. Their slogan is "take care of your friends and leave the risks of the free market for the suckers." That would be John Q. Public.

From Halliburton's overcharging in Iraq to Enron's manipulation of the California energy crisis and now the emerging hurricane reconstruction boondoggle, we witness what happens when the federal government is turned into a glorified help desk and ATM machine for politically connected corporations.

But the defining case study on the deep corruption of the Bush administration and the GOP is emerging from the myriad investigations of well-connected Republican fundraiser and lobbyist Jack Abramoff. For starters, Abramoff, a $100,000-plus fundraiser for George W. Bush's presidential campaigns, is under federal indictment on wire fraud and conspiracy charges. He is also under congressional and FBI investigations.

In the last fortnight alone, the spreading stain of Abramoff's legacy is seen in the possible undoing of Bush's nominee to the nation's No. 2 law enforcement position, the resignation and arrest of the Office of Management and Budget's former procurement chief and another blow to the already tawdry reputation of top Bush political advisor Karl Rove.

It was reported last week that Timothy Flanigan, Tyco International Ltd. general counsel and Bush's nominee for deputy attorney general, stated that Abramoff's lobbying firm had boasted that his access to the highest levels of Congress could help Tyco fight tax liability legislation and that Abramoff later said he "had contact with Mr. Karl Rove" about the issue.

Flanigan's statement was in response to scathing criticism from Democrats on the Senate Judiciary Committee - which is considering his nomination - that he had not been sufficiently responsive in his testimony. Records and interviews show that Flanigan supervised Abramoff's successful efforts two years ago to lobby Congress to kill the legislation, which would have penalized companies such as Bermuda-based Tyco that avoid taxes by moving offshore. Abramoff's firm was paid $1.7 million by Tyco in 2003 and 2004.

In his statement, Flanigan said Abramoff also boasted of his ties to Tom DeLay, the House majority leader. DeLay once described Abramoff as "one of my closest and dearest friends" and accompanied him on several foreign junkets. DeLay denies that the Abramoff-arranged trips were political favors. DeLay continues to be tangled in myriad ethics investigations, many of them linked to his relationship with Abramoff.

Another episode in the rapidly evolving Abramoff scandal involves David Safavian, one of the Bush administration's top federal procurement officials. He resigned shortly before being arrested last week for allegedly lying to officials and obstructing a Justice Department investigation in connection with his relationship with Abramoff. Safavian received a golf trip to Scotland with the lobbyist, allegedly as a quid pro quo for helping Abramoff in his efforts to buy federal properties. Safavian and Abramoff once worked together at a powerful Washington lobbying firm.

Before Safavian resigned, he reportedly was working on contracting policies for Hurricane Katrina recovery efforts. Don't expect the GOP Congress to look askance at this. Safavian's wife is chief counsel for oversight and investigations on the House Government Reform Committee, which oversees procurement matters, although she's said she'll recuse herself.

The hurricane season is proving to be a windfall for GOP-connected companies such as Halliburton, which are being rewarded with lucrative contracts despite their shoddy performance in Iraq. In the vocabulary of crony capitalism, the word "shame" does not exist.

The players may change, given the occasional criminal indictment, but the game goes on. On the day of Safavian's arrest, former Tyco Chief Executive L. Dennis Kozlowski was sentenced to eight to 25 years in prison for bilking millions from the company, which we are now expected to believe has been reborn virtuous.

Tyco's current lobbyist, Edward P. Ayoob, who once worked with Abramoff at a Washington law firm, is lobbying for another cause these days: Flanigan's confirmation as the nation's second-highest law enforcement officer. Ayoob insisted last week that he is acting on his own and not on behalf of Tyco. And, oh yes, Flanigan promises that, if confirmed, he will recuse himself from any Abramoff investigation involving Tyco. Sure.

[May 23, 2015] The Children of the Abyss

May 20, 2015 | Jesse's Café Américain
"He shows you how to become as gods. Then he laughs and jokes with you, and gets intimate with you; he takes your hand, and gets his fingers between yours, and grasps them, and then you are his."

J.H.Newman, The Times of Antichrist

People do not wake up one day and suddenly decide to become monsters, giving birth to unspeakable horrors.

And yet throughout history, different peoples have done truly monstrous things. The Americans were pioneers in forced sterilization and state propaganda. The British invented concentration camps, and were masters of predatory colonization. They even turned a large portion of the capital of their Empire into a festering ghetto through the Darwinian economics of neglect. None have clean hands. No one is exceptional.

What do they have in common? They all take a walk down a long and twisted path, one cold-hearted and 'expedient' decision at a time, shifting responsibility by deflecting the choice for their actions on their leaders.

There is always some crackpot theory. some law of nature, from scientists or economists to support it. What else could they do? It is always difficult, but necessary.

They cope with their actions by making their victims the other, objectified, different, marginalized. And what they marginalize they cannot see. What they cannot see, by choice, is easily ignored.

And so they destroy and they kill, first by neglect and then by more efficient and decisive actions.

They walk slowly, but almost determinedly, into an abyss of their own creation.

But they all seem to have one thing in common. First they come for the old, the weak, the disabled, and the different, in a widening circle of scapegoats for their plunder.

"There is one beautiful sight in the East End, and only one, and it is the children dancing in the street when the organ-grinder goes his round. It is fascinating to watch them, the new-born, the next generation, swaying and stepping, with pretty little mimicries and graceful inventions all their own, with muscles that move swiftly and easily, and bodies that leap airily, weaving rhythms never taught in dancing school.

I have talked with these children, here, there, and everywhere, and they struck me as being bright as other children, and in many ways even brighter. They have most active little imaginations. Their capacity for projecting themselves into the realm of romance and fantasy is remarkable. A joyous life is romping in their blood. They delight in music, and motion, and colour, and very often they betray a startling beauty of face and form under their filth and rags.

But there is a Pied Piper of London Town who steals them all away. They disappear. One never sees them again, or anything that suggests them. You may look for them in vain amongst the generation of grown-ups. Here you will find stunted forms, ugly faces, and blunt and stolid minds. Grace, beauty, imagination, all the resiliency of mind and muscle, are gone. Sometimes, however, you may see a woman, not necessarily old, but twisted and deformed out of all womanhood, bloated and drunken, lift her draggled skirts and execute a few grotesque and lumbering steps upon the pavement. It is a hint that she was once one of those children who danced to the organ-grinder. Those grotesque and lumbering steps are all that is left of the promise of childhood. In the befogged recesses of her brain has arisen a fleeting memory that she was once a girl. The crowd closes in. Little girls are dancing beside her, about her, with all the pretty graces she dimly recollects, but can no more than parody with her body. Then she pants for breath, exhausted, and stumbles out through the circle. But the little girls dance on.

The children of the Ghetto possess all the qualities which make for noble manhood and womanhood; but the Ghetto itself, like an infuriated tigress turning on its young, turns upon and destroys all these qualities, blots out the light and laughter, and moulds those it does not kill into sodden and forlorn creatures, uncouth, degraded, and wretched below the beasts of the field.

As to the manner in which this is done, I have in previous chapters described it at length; here let Professor Huxley describe it in brief:-

"Any one who is acquainted with the state of the population of all great industrial centres, whether in this or other countries, is aware that amidst a large and increasing body of that population there reigns supreme . . . that condition which the French call la misere, a word for which I do not think there is any exact English equivalent. It is a condition in which the food, warmth, and clothing which are necessary for the mere maintenance of the functions of the body in their normal state cannot be obtained; in which men, women, and children are forced to crowd into dens wherein decency is abolished, and the most ordinary conditions of healthful existence are impossible of attainment; in which the pleasures within reach are reduced to brutality and drunkenness; in which the pains accumulate at compound interest in the shape of starvation, disease, stunted development, and moral degradation; in which the prospect of even steady and honest industry is a life of unsuccessful battling with hunger, rounded by a pauper's grave."

In such conditions, the outlook for children is hopeless. They die like flies, and those that survive, survive because they possess excessive vitality and a capacity of adaptation to the degradation with which they are surrounded. They have no home life. In the dens and lairs in which they live they are exposed to all that is obscene and indecent. And as their minds are made rotten, so are their bodies made rotten by bad sanitation, overcrowding, and underfeeding. When a father and mother live with three or four children in a room where the children take turn about in sitting up to drive the rats away from the sleepers, when those children never have enough to eat and are preyed upon and made miserable and weak by swarming vermin, the sort of men and women the survivors will make can readily be imagined."

Jack London, The People of the Abyss

[May 09, 2015] Nomi Prins The Clintons & Their Banker Friends

May 08, 2015 | Zero Hedge
In the coming months, however many hours Clinton spends introducing herself to voters in small-town America, she will spend hundreds more raising money in four-star hotels and multimillion-dollar homes around the nation. The question is: "Can Clinton claim to stand for 'everyday Americans,' while hauling in huge sums of cash from the very wealthiest of us?" This much cannot be disputed: Clinton's connections to the financiers and bankers of this country - and this country's campaigns - run deep. As Nomi Prins questions, who counts more to such a candidate, the person you met over that chicken burrito bowl or the Citigroup partner you met over crudités and caviar?

Via TomDispatch.com,

The Clintons and Their Banker Friends
The Wall Street Connection (1992 to 2016)

[This piece has been adapted and updated by Nomi Prins from chapters 18 and 19 of her book All the Presidents' Bankers: The Hidden Alliances that Drive American Power, just out in paperback (Nation Books).]

The past, especially the political past, doesn't just provide clues to the present. In the realm of the presidency and Wall Street, it provides an ongoing pathway for political-financial relationships and policies that remain a threat to the American economy going forward.

When Hillary Clinton video-announced her bid for the Oval Office, she claimed she wanted to be a "champion" for the American people. Since then, she has attempted to recast herself as a populist and distance herself from some of the policies of her husband. But Bill Clinton did not become president without sharing the friendships, associations, and ideologies of the elite banking sect, nor will Hillary Clinton. Such relationships run too deep and are too longstanding.

To grasp the dangers that the Big Six banks (JPMorgan Chase, Citigroup, Bank of America, Wells Fargo, Goldman Sachs, and Morgan Stanley) presently pose to the financial stability of our nation and the world, you need to understand their history in Washington, starting with the Clinton years of the 1990s. Alliances established then (not exclusively with Democrats, since bankers are bipartisan by nature) enabled these firms to become as politically powerful as they are today and to exert that power over an unprecedented amount of capital. Rest assured of one thing: their past and present CEOs will prove as critical in backing a Hillary Clinton presidency as they were in enabling her husband's years in office.

In return, today's titans of finance and their hordes of lobbyists, more than half of whom held prior positions in the government, exact certain requirements from Washington. They need to know that a safety net or bailout will always be available in times of emergency and that the regulatory road will be open to whatever practices they deem most profitable.

Whatever her populist pitch may be in the 2016 campaign -- and she will have one -- note that, in all these years, Hillary Clinton has not publicly condemned Wall Street or any individual Wall Street leader. Though she may, in the heat of that campaign, raise the bad-apples or bad-situation explanation for Wall Street's role in the financial crisis of 2007-2008, rest assured that she will not point fingers at her friends. She will not chastise the people that pay her hundreds of thousands of dollars a pop to speak or the ones that have long shared the social circles in which she and her husband move. She is an undeniable component of the Clinton political-financial legacy that came to national fruition more than 23 years ago, which is why looking back at the history of the first Clinton presidency is likely to tell you so much about the shape and character of the possible second one.

The 1992 Election and the Rise of Bill Clinton

Challenging President George H.W. Bush, who was seeking a second term, Arkansas Governor Bill Clinton announced he would seek the 1992 Democratic nomination for the presidency on October 2, 1991. The upcoming presidential election would not, however, turn out to alter the path of mergers or White House support for deregulation that was already in play one iota.

First, though, Clinton needed money. A consummate fundraiser in his home state, he cleverly amassed backing and established early alliances with Wall Street. One of his key supporters would later change American banking forever. As Clinton put it, he received "invaluable early support" from Ken Brody, a Goldman Sachs executive seeking to delve into Democratic politics. Brody took Clinton "to a dinner with high-powered New York businesspeople, including Bob Rubin, whose tightly reasoned arguments for a new economic policy," Clinton later wrote, "made a lasting impression on me."

The battle for the White House kicked into high gear the following fall. William Schreyer, chairman and CEO of Merrill Lynch, showed his support for Bush by giving the maximum personal contribution to his campaign committee permitted by law: $1,000. But he wanted to do more. So when one of Bush's fundraisers solicited him to contribute to the Republican National Committee's nonfederal, or "soft money," account, Schreyer made a $100,000 donation.

The bankers' alliances remained divided among the candidates at first, as they considered which man would be best for their own power trajectories, but their donations were plentiful: mortgage and broker company contributions were $1.2 million; 46% to the GOP and 54% to the Democrats. Commercial banks poured in $14.8 million to the 1992 campaigns at a near 50-50 split.

Clinton, like every good Democrat, campaigned publicly against the bankers: "It's time to end the greed that consumed Wall Street and ruined our S&Ls [Savings and Loans] in the last decade," he said. But equally, he had no qualms about taking money from the financial sector. In the early months of his campaign, BusinessWeek estimated that he received $2 million of his initial $8.5 million in contributions from New York, under the care of Ken Brody.

"If I had a Ken Brody working for me in every state, I'd be like the Maytag man with nothing to do," said Rahm Emanuel, who ran Clinton's nationwide fundraising committee and later became Barack Obama's chief of staff. Wealthy donors and prospective fundraisers were invited to a select series of intimate meetings with Clinton at the plush Manhattan office of the prestigious private equity firm Blackstone.

Robert Rubin Comes to Washington

Clinton knew that embracing the bankers would help him get things done in Washington, and what he wanted to get done dovetailed nicely with their desires anyway. To facilitate his policies and maintain ties to Wall Street, he selected a man who had been instrumental to his campaign, Robert Rubin, as his economic adviser.

In 1980, Rubin had landed on Goldman Sachs' management committee alongside fellow Democrat Jon Corzine. A decade later, Rubin and Stephen Friedman were appointed cochairmen of Goldman Sachs. Rubin's political aspirations met an appropriate opportunity when Clinton captured the White House.

On January 25, 1993, Clinton appointed him as assistant to the president for economic policy. Shortly thereafter, the president created a unique role for his comrade, head of the newly created National Economic Council. "I asked Bob Rubin to take on a new job," Clinton later wrote, "coordinating economic policy in the White House as Chairman of the National Economic Council, which would operate in much the same way the National Security Council did, bringing all the relevant agencies together to formulate and implement policy... [I]f he could balance all of [Goldman Sachs'] egos and interests, he had a good chance to succeed with the job." (Ten years later, President George W. Bush gave the same position to Rubin's old partner, Friedman.)

Back at Goldman, Jon Corzine, co-head of fixed income, and Henry Paulson, co-head of investment banking, were ascending through the ranks. They became co-CEOs when Friedman retired at the end of 1994.

Those two men were the perfect bipartisan duo. Corzine was a staunch Democrat serving on the International Capital Markets Advisory Committee of the Federal Reserve Bank of New York (from 1989 to 1999). He would co-chair a presidential commission for Clinton on capital budgeting between 1997 and 1999, while serving in a key role on the Borrowing Advisory Committee of the Treasury Department. Paulson was a well connected Republican and Harvard graduate who had served on the White House Domestic Council as staff assistant to the president in the Nixon administration.

Bankers Forge Ahead

By May 1995, Rubin was impatiently warning Congress that the Glass-Steagall Act could "conceivably impede safety and soundness by limiting revenue diversification." Banking deregulation was then inching through Congress. As they had during the previous Bush administration, both the House and Senate Banking Committees had approved separate versions of legislation to repeal Glass-Steagall, the 1933 Act passed by the administration of Franklin Delano Roosevelt that had separated deposit-taking and lending or "commercial" bank activities from speculative or "investment bank" activities, such as securities creation and trading. Conference negotiations had fallen apart, though, and the effort was stalled.

By 1996, however, other industries, representing core clients of the banking sector, were already being deregulated. On February 8, 1996, Clinton signed the Telecom Act, which killed many independent and smaller broadcasting companies by opening a national market for "cross-ownership." The result was mass mergers in that sector advised by banks.

Deregulation of companies that could transport energy across state lines came next. Before such deregulation, state commissions had regulated companies that owned power plants and transmission lines, which worked together to distribute power. Afterward, these could be divided and effectively traded without uniform regulation or responsibility to regional customers. This would lead to blackouts in California and a slew of energy derivatives, as well as trades at firms such as Enron that used the energy business as a front for fraudulent deals.

The number of mergers and stock and debt issuances ballooned on the back of all the deregulation that eliminated barriers that had kept companies separated. As industries consolidated, they also ramped up their complex transactions and special purpose vehicles (off-balance-sheet, offshore constructions tailored by the banking community to hide the true nature of their debts and shield their profits from taxes). Bankers kicked into overdrive to generate fees and create related deals. Many of these blew up in the early 2000s in a spate of scandals and bankruptcies, causing an earlier millennium recession.

Meanwhile, though, bankers plowed ahead with their advisory services, speculative enterprises, and deregulation pursuits. President Clinton and his team would soon provide them an epic gift, all in the name of U.S. global power and competitiveness. Robert Rubin would steer the White House ship to that goal.

On February 12, 1999, Rubin found a fresh angle to argue on behalf of banking deregulation. He addressed the House Committee on Banking and Financial Services, claiming that, "the problem U.S. financial services firms face abroad is more one of access than lack of competitiveness."

He was referring to the European banks' increasing control of distribution channels into the European institutional and retail client base. Unlike U.S. commercial banks, European banks had no restrictions keeping them from buying and teaming up with U.S. or other securities firms and investment banks to create or distribute their products. He did not appear concerned about the destruction caused by sizeable financial bets throughout Europe. The international competitiveness argument allowed him to focus the committee on what needed to be done domestically in the banking sector to remain competitive.

Rubin stressed the necessity of HR 665, the Financial Services Modernization Act of 1999, or the Gramm-Leach-Bliley Act, that was officially introduced on February 10, 1999. He said it took "fundamental actions to modernize our financial system by repealing the Glass-Steagall Act prohibitions on banks affiliating with securities firms and repealing the Bank Holding Company Act prohibitions on insurance underwriting."

The Gramm-Leach-Bliley Act Marches Forward

On February 24, 1999, in more testimony before the Senate Banking Committee, Rubin pushed for fewer prohibitions on bank affiliates that wanted to perform the same functions as their larger bank holding company, once the different types of financial firms could legally merge. That minor distinction would enable subsidiaries to place all sorts of bets and house all sorts of junk under the false premise that they had the same capital beneath them as their parent. The idea that a subsidiary's problems can't taint or destroy the host, or bank holding company, or create "catastrophic" risk, is a myth perpetuated by bankers and political enablers that continues to this day.

Rubin had no qualms with mega-consolidations across multiple service lines. His real problems were those of his banker friends, which lay with the financial modernization bill's "prohibition on the use of subsidiaries by larger banks." The bankers wanted the right to establish off-book subsidiaries where they could hide risks, and profits, as needed.

Again, Rubin decided to use the notion of remaining competitive with foreign banks to make his point. This technicality was "unacceptable to the administration," he said, not least because "foreign banks underwrite and deal in securities through subsidiaries in the United States, and U.S. banks [already] conduct securities and merchant banking activities abroad through so-called Edge subsidiaries." Rubin got his way. These off-book, risky, and barely regulated subsidiaries would be at the forefront of the 2008 financial crisis.

On March 1, 1999, Senator Phil Gramm released a final draft of the Financial Services Modernization Act of 1999 and scheduled committee consideration for March 4th. A bevy of excited financial titans who were close to Clinton, including Travelers CEO Sandy Weill, Bank of America CEO, Hugh McColl, and American Express CEO Harvey Golub, called for "swift congressional action."

The Quintessential Revolving-Door Man

The stock market continued its meteoric rise in anticipation of a banker-friendly conclusion to the legislation that would deregulate their industry. Rising consumer confidence reflected the nation's fondness for the markets and lack of empathy with the rest of the world's economic plight. On March 29, 1999, the Dow Jones Industrial Average closed above 10,000 for the first time. Six weeks later, on May 6th, the Financial Services Modernization Act passed the Senate. It legalized, after the fact, the merger that created the nation's biggest bank. Citigroup, the marriage of Citibank and Travelers, had been finalized the previous October.

It was not until that point that one of Glass-Steagall's main assassins decided to leave Washington. Six days after the bill passed the Senate, on May 12, 1999, Robert Rubin abruptly announced his resignation. As Clinton wrote, "I believed he had been the best and most important treasury secretary since Alexander Hamilton... He had played a decisive role in our efforts to restore economic growth and spread its benefits to more Americans."

Clinton named Larry Summers to succeed Rubin. Two weeks later, BusinessWeek reported signs of trouble in merger paradise -- in the form of a growing rift between John Reed, the former Chairman of Citibank, and Sandy Weill at the new Citigroup. As Reed said, "Co-CEOs are hard." Perhaps to patch their rift, or simply to take advantage of a political opportunity, the two men enlisted a third person to join their relationship -- none other than Robert Rubin.

Rubin's resignation from Treasury became effective on July 2nd. At that time, he announced, "This almost six and a half years has been all-consuming, and I think it is time for me to go home to New York and to do whatever I'm going to do next." Rubin became chairman of Citigroup's executive committee and a member of the newly created "office of the chairman." His initial annual compensation package was worth around $40 million. It was more than worth the "hit" he took when he left Goldman for the Treasury post.

Three days after the conference committee endorsed the Gramm-Leach-Bliley bill, Rubin assumed his Citigroup position, joining the institution destined to dominate the financial industry. That very same day, Reed and Weill issued a joint statement praising Washington for "liberating our financial companies from an antiquated regulatory structure," stating that "this legislation will unleash the creativity of our industry and ensure our global competitiveness."

On November 4th, the Senate approved the Gramm-Leach-Bliley Act by a vote of 90 to 8. (The House voted 362–57 in favor.) Critics famously referred to it as the Citigroup Authorization Act.

Mirth abounded in Clinton's White House. "Today Congress voted to update the rules that have governed financial services since the Great Depression and replace them with a system for the twenty-first century," Summers said. "This historic legislation will better enable American companies to compete in the new economy."

But the happiness was misguided. Deregulating the banking industry might have helped the titans of Wall Street but not people on Main Street. The Clinton era epitomized the vast difference between appearance and reality, spin and actuality. As the decade drew to a close, Clinton basked in the glow of a lofty stock market, a budget surplus, and the passage of this key banking "modernization." It would be revealed in the 2000s that many corporate profits of the 1990s were based on inflated evaluations, manipulation, and fraud. When Clinton left office, the gap between rich and poor was greater than it had been in 1992, and yet the Democrats heralded him as some sort of prosperity hero.

When he resigned in 1997, Robert Reich, Clinton's labor secretary, said, "America is prospering, but the prosperity is not being widely shared, certainly not as widely shared as it once was... We have made progress in growing the economy. But growing together again must be our central goal in the future." Instead, the growth of wealth inequality in the United States accelerated, as the men yielding the most financial power wielded it with increasingly less culpability or restriction. By 2015, that wealth or prosperity gap would stand near historic highs.

The power of the bankers increased dramatically in the wake of the repeal of Glass-Steagall. The Clinton administration had rendered twenty-first-century banking practices similar to those of the pre-1929 crash. But worse. "Modernizing" meant utilizing government-backed depositors' funds as collateral for the creation and distribution of all types of complex securities and derivatives whose proliferation would be increasingly quick and dangerous.

Eviscerating Glass-Steagall allowed big banks to compete against Europe and also enabled them to go on a rampage: more acquisitions, greater speculation, and more risky products. The big banks used their bloated balance sheets to engage in more complex activity, while counting on customer deposits and loans as capital chips on the global betting table. Bankers used hefty trading profits and wealth to increase lobbying funds and campaign donations, creating an endless circle of influence and mutual reinforcement of boundary-less speculation, endorsed by the White House.

Deposits could be used to garner larger windfalls, just as cheap labor and commodities in developing countries were used to formulate more expensive goods for profit in the upper echelons of the global financial hierarchy. Energy and telecoms proved especially fertile ground for the investment banking fee business (and later for fraud, extensive lawsuits, and bankruptcies). Deregulation greased the wheels of complex financial instruments such as collateralized debt obligations, junk bonds, toxic assets, and unregulated derivatives.

The Glass-Steagall repeal led to unfettered derivatives growth and unstable balance sheets at commercial banks that merged with investment banks and at investment banks that preferred to remain solo but engaged in dodgier practices to remain "competitive." In conjunction with the tight political-financial alignment and associated collaboration that began with Bush and increased under Clinton, bankers channeled the 1920s, only with more power over an immense and growing pile of global financial assets and increasingly "open" markets. In the process, accountability would evaporate.

Every bank accelerated its hunt for acquisitions and deposits to amass global influence while creating, trading, and distributing increasingly convoluted securities and derivatives. These practices would foster the kind of shaky, interconnected, and opaque financial environment that provided the backdrop and conditions leading up to the financial meltdown of 2008.

The Realities of 2016

Hillary Clinton is, of course, not her husband. But her access to his past banker alliances, amplified by the ones that she has formed herself, makes her more of a friend than an adversary to the banking industry. In her brief 2008 candidacy, all four of the New York-based Big Six banks ranked among her top 10 corporate donors. They have also contributed to the Clinton Foundation. She needs them to win, just as both Barack Obama and Bill Clinton did.

No matter what spin is used for campaigning purposes, the idea that a critical distance can be maintained between the White House and Wall Street is naïve given the multiple channels of money and favors that flow between the two. It is even more improbable, given the history of connections that Hillary Clinton has established through her associations with key bank leaders in the early 1990s, during her time as a senator from New York, and given their contributions to the Clinton foundation while she was secretary of state. At some level, the situation couldn't be less complicated: her path aligns with that of the country's most powerful bankers. If she becomes president, that will remain the case.

[May 06, 2015] Clinton Cash: errors dog Bill and Hillary exposé – but is there any 'there' there? by Ed Pilkington

May 05, 2015 | The Guardian

In an interview with the sympathetic Fox News (owned by Rupert Murdoch, who also owns Harper, the publisher of Clinton Cash) it was put to Schweizer that he hadn't "nailed" his thesis. "It's hard for any author to nail it – one of the strategies of the Clinton camp is to set a bar for me as an author that is impossible to meet," he replied.

... ... ...

Certainly, pundits were warning about the problem of the large sums of money flowing into the Clinton Foundation's coffers even before Hillary Clinton took up her position as Obama's global emissary-in-chief. A month before she became secretary of state, the Washington Post warned in an editorial that her husband's fundraising activities were problematic. "Even if Ms Clinton is not influenced by gifts to her husband's charity, the appearance of conflict is unavoidable."

Since the foundation was formed in 2001, some $2bn has been donated, mainly in big lump sums. Fully a third of the donors giving more than $1m, and more than a half of those handing over more than $5m, have been foreign governments, corporations or tycoons. (The foundation stresses that such largesse has been put to very good use – fighting obesity around the globe, combating climate change, helping millions of people with HIV/Aids obtain antiretroviral drugs at affordable prices.)

Schweizer may have made mistakes about aspects of Bill Clinton's fees on the speaker circuit, but one of his main contentions – that the former president's rates skyrocketed after his wife became secretary of state – is correct. Politifact confirmed that since leaving the White House in 2001 and 2013, Bill Clinton made 13 speeches for which he commanded more than $500,000; all but two of those mega-money earners occurred in the period when Hillary was at the State Department.

Though Schweizer has failed to prove actual corruption in the arrangement – at no point in the book does he produce evidence showing that Bill's exorbitant speaker fees were directly tied to policy concessions from Hillary – he does point to several glaring conflicts of interest. Bill Clinton did accept large speaker fees accumulating to more than $1m from TD Bank, a major shareholder in the Keystone XL pipeline, at precisely the time that the Obama administration, and Hillary Clinton within it, was wrestling with the vexed issue of whether to approve it.

It is also true that large donations to the foundation from the chairman of Uranium One, Ian Telfer, at around the time of the Russian purchase of the company and while Hillary Clinton was secretary of state, were never disclosed to the public. The multimillion sums were channeled through a subsidiary of the Clinton Foundation, CGSCI, which did not reveal its individual donors.

Such awkward collisions between Bill's fundraising activities and Hillary's public service have raised concerns not just among those who might be dismissed as part of a vast rightwing conspiracy. Take Zephyr Teachout, a law professor at Fordham university who has written extensively on political corruption in the US.

Teachout, who last year stood against Andrew Cuomo for the Democratic party nomination for New York governor, points out that you don't have to be able to prove quid pro quo for alarm bells to ring. "Our whole system of rules is built upon the concept that you must prevent conflicts of interests if you are to resist corruption in its many forms. Conflicts like that can infect us in ways we don't even see."

Teachout said that the Clintons presented the US political world with a totally new challenge. "We have never had somebody running for president whose spouse – himself a former president – is running around the world raising money in these vast sums."

... ... ...

Though Bill Clinton insisted this week that his charity has done nothing "knowingly inappropriate", that is unlikely to satisfy the skeptics from left or right. They say that a family in which one member is vying for the most powerful office on Earth must avoid straying into even the unintentionally inappropriate.

In the wake of Clinton Cash, the foundation has admitted that it made mistakes in disclosing some of its contributions. It has also implemented new rules that will see its financial reporting increase from once annually to four times a year, while large donations from foreign governments will be limited in future to six countries including the UK and Germany.

But with Bill refusing doggedly to give up his speaker engagements – "I gotta pay our bills" – and foreign corporations and super-rich individuals still able to donate to the family charity, it looks like this controversy may run and run. Politically, too, Hillary Clinton is confronted with a potential credibility gap between her appeal to ordinary Americans on the presidential campaign trail and the millions that continue to flow to the foundation.

"Is she going to be in touch with the needs and dreams of poor America when her spouse and daughter are working with the world's global elite?" said Dave Levinthal of the anti-corruption investigative organization, the Center for Public Integrity. "That's a question she will have to answer, every step of the way."

mkenney63 5 May 2015 20:39
It would be nice to know how much Saudi and Chinese money her "Foundation" has taken-in. I can tell you how much Bernie has taken - $0. Bernie, the only truly progressive in the race, raised $1.5 million in one day from ordinary working people like you and me who have the smarts to know who's really in their corner. When I look at Hillary I ask myself, do we really want parasitic people like this running our country? Is there anything she has ever touched that isn't tainted by a lust for money?
foggy2 gixxerman006 5 May 2015 20:38
I am in the process of reading the actual book. He does have actual sources for many things but what is missing is the information controlled by that now cleaned off server and the details of just who contributed to them, their foundation, and who hired them for those gold plated speeches. Those names never were made public and now the related tax forms are being "redone." Wonder how long that will take.

The author was able to get pertinent data from the Canadian tax base information and that is important because some of the heavier hitters are Canadians who needed help in the US and other places to make piles of money on their investments. And many statements made by people are documented as are some cables sent TO the state department.

AlfredHerring raffine 5 May 2015 20:33

It's funny that free-market Tea Party Republicans criticize the Clintons

There's a broad populist streak in the Tea Party. They may be social conservatives and opposed to government telling them they MUST buy health insurance from a private company (that's where it started) but on many issues they're part of the Teddy Roosevelt trust busting and Franklin Roosevelt New Deal traditions.

[May 05, 2015] Ben Bernanke's Bad Example

It's a pay off for doing what Big Finance wants. It's ironic that Bernanke, who didn't recognize the biggest bubble in financial history until it popped is being paid millions of dollars for uncovering economic trends.
May 05, 2015 | Economist's View

At MoneyWatch:

Ben Bernanke's bad example, by Mark Thoma: The recent announcements that former Federal Reserve Chairman Ben Bernanke has accepted a position as a senior adviser at Pimco and a similar position at hedge fund Citadel have raised questions about whether the "revolving door" between government and private sector jobs ought to be restricted.
Perhaps, for example, Federal Reserve officials should be subject to a five-year waiting period before they can take jobs in the financial sector. The idea would be to reduce the chance that bank regulators could be influenced through formal and informal ties to previous Fed officials.
My concern is somewhat different: The incentive for Federal Reserve Board members to step down before their terms are up and accept lucrative private sector positions has the potential to damage the Fed as an independent institution...

Syaloch -> pgl...

"For 2014, the Chairman's annual salary is $201,700. The annual salary of the other Board members (including the Vice Chairman) is $181,500."

http://www.federalreserve.gov/faqs/about_12591.htm

$201,700 isn't a good salary? Sure, maybe it's peanuts to someone working on Wall Street, but doesn't that kinda go to the point that Thoma was making?

"[Bernanke's] stepping down isn't the main problem. It's the idea that it's OK for a former Fed member -- and its chair, no less -- to take these kinds of jobs once you leave. If Bernanke had returned to academia or limited himself to his position at the Brookings Institution, that wouldn't be a problem.

"However, if the chair can cash out, then other board members will also have an incentive to resign their positions as Fed governors after a few years to pursue financial interests in the private sector. Bernanke's acceptance of positions at Citadel and Pimco sets a bad precedent because it encourages other board members to do the same."

pgl -> Syaloch...

Where on earth did I say he made minimum wages? I said he did a good job and $200,000 a year was a bargain even if it was not slave wages.

DrDick -> pgl...

It is much more than most academic economists make. It is, in fact, a very good salary by any reasonable standard. The fact that people on Wall Street are paid obscene amounts for no useful product is beside the point.

am -> Syaloch...

US$200,000 is about GBP133,333.

Now here is the salary for the BOE equivalent.

http://blogs.marketwatch.com/thetell/2014/06/17/mark-carneys-salary-at-the-bank-of-england-is-four-times-what-janet-yellen-is-paid-at-the-fed/

Kind of puts U$200,000 in perspective. Anyone who takes the FED job sure ain't doing it for the money. Must be for prestige or future earnings when they retire or resign.

Bit of a shock to a European to see how poorly paid some US civil servants are.

Ellis

It's a pay off for doing what Big Finance wants.

It's ironic that Bernanke, who didn't recognize the biggest bubble in financial history until it popped is being paid millions of dollars for uncovering economic trends.

pgl -> Ellis...

Pray tell - who did foresee this bubble and its busting? Robert Lucas even in 2009 was arguing no one could have foreseen it as he was supposed to be the Dean of Macroeconomics back then.

supersaurus -> pgl...

uhhh...http://www.nytimes.com/2005/08/08/opinion/08krugman.html . that's "dr. nobody", right?

Ellis -> pgl...

Dean Baker and Nouriel Roubini, off the top of my head.

You could see it coming a mile away, especially given the worsening financialization and boom-bust pattern over the last four decades.

Of course, Bernanke said the exact opposite, that we were in the middle of the Great Moderation. Like most politicians, he's a liar, covering for the banks that made a fortune off the bubble, and then insulated from the catastrophe by the government and Fed.

Ellis -> pgl...

Dean Baker and Nouriel Roubini, off the top of my head.

You could see it coming a mile away, especially given the worsening financialization and boom-bust pattern over the last four decades.

Of course, Bernanke said the exact opposite, that we were in the middle of the Great Moderation. Like most politicians, he's a liar, covering for the banks that made a fortune off the bubble, and then insulated from the catastrophe by the government and Fed.

pgl -> Ellis...

The trio was also mocked by many at the time. Yes - they got it right and they deserve credit for doing so. But none of them have ever attacked Bernanke for not being as fore sighted.

But hey - I guess it is beat up on Ben day so have at it!

DrDick -> pgl...

While I think he could have done better at the Fed, I think he was decent in that position. He should not be allowed to take this job, however.

Ellis -> pgl...

Yes, they were mocked -- which is not surprising, given the financial and career advancement incentives -- which is exactly the point. Have you seen the documentary "Inside Job"? It has a good section on corruption among top economists.

Your wrong on your second point: Check out the post by Dean Baker in Beat the Press, April 30, "The Man Who Completely Missed the Housing Bubble and Was Convinced Financial Disruption Would be Restricted to the Subprime Market Deserves Two Seven-Figure Sinecures?"

Sorry for being so "mean and nasty" about Bernanke. But compare that to all those who lost everything, as a result of the crisis that he oversaw? His big salaries, of course, are little more than a tip from the big boys, who made out so well.

Roger Gathmann -> pgl...

You really see no difference between economic journalists and the head of the FED? Uh, that is pretty incredible.

How could Bernanke have found out more? Well, maybe he could have operated a bit more like Steve Eisman at frontpoint who did the math, as reported by Michael Lewis in The Big Short.
Really, to pretend that the FED has the same capacities as a newspaper columnist or economics professor, that the voices, and there were more than two or three, in the financial industry warning that there was something deeply wrong, is to apologize for Bernanke by saying, hey, he was a complete doofus, but he did all right after he sank the ship.
Greenspan and Bernanke were the worst FED chairmen in the Fed's history. The record, which should be read in terms of the health of the general economy, bears this out. Granted, after three crashes that seemed not to result in Depressions, Greenspan might not seem as bad, but it was his spirit and ideas that created the de-regulatory box and the market can do no wrong ethos at the Fed, which Bernanke continued. Bernanke even got a second chance after Bear Stearns fell. But no, between May and September, 2008, the Fed pretty much sat on its hands.

Roger Gathmann

Bernanke served the hedge fund sector well during his reign of terror at the Fed. Who can forget the loans to even a semi-criminal hedge fund like Yorkville from the ever understanding Fed, once the roof fell in? Or to all the other moneyed interests?
And who can forget the prophet Bernanke? The one who, in 2005, looked about and said yeah, there is no housing bubble, and anyway, housing prices don't decline:
http://www.washingtonpost.com/wp-dyn/content/article/2005/10/26/AR2005102602255.html

"U.S. house prices have risen by nearly 25 percent over the past two years, noted Bernanke, currently chairman of the president's Council of Economic Advisers, in testimony to Congress's Joint Economic Committee. But these increases, he said, "largely reflect strong economic fundamentals," such as strong growth in jobs, incomes and the number of new households."
I like the strong increase in incomes remark particularly. No wonder Bush, who had shown an eye for characters like Bernanke - Wolfowitz, Rumsfeld and Cheney shared a similar bogus confidence in their "facts" - appointed him. And he didn't disappoint. This is the guy who said that the Fed shouldn't be second guessing on the price of assets - free market, don't you know? - whose response to Stock market declines in 2006 and 2007 with a series of cuts was all about - keeping up the price of assets. But these were special assets, the kind of assets mainly held by the upper 20 percent income group. Not the tawdry assets held by the lower 80 with their homes.

Here he is, in his speech on the state of the economy in March, 2007, giving us more prophetic Ben:

http://www.federalreserve.gov/newsevents/testimony/bernanke20070328a.htm

Although the turmoil in the subprime mortgage market has created severe financial problems for many individuals and families, the implications of these developments for the housing market as a whole are less clear. The ongoing tightening of lending standards, although an appropriate market response, will reduce somewhat the effective demand for housing, and foreclosed properties will add to the inventories of unsold homes. At this juncture, however, the impact on the broader economy and financial markets of the problems in the subprime market seems likely to be contained. In particular, mortgages to prime borrowers and fixed-rate mortgages to all classes of borrowers continue to perform well, with low rates of delinquency."

Bear Stearns collapsed two months after everything was contained, in May. Now, did Mr Bernanke think maybe there needed to be some urgent work done to make sure other big banks weren't at risk? Were he and his friend in Treasury in firefighing mode? Of course not. That would not be serving the hedge fund community well.

Not that he was without ideas. Obviously, you wouldn't want to regulate a market in CDOs - it would be irresponsible to suggest such things! - but you could recommend that the bottom 80 percent be better informed about the risks they were taking.

Ace idea. Maybe even the top 1 percent should have been informed about the risks they were running? oh, but they have the computers and the smarts, of course. No need to rush right in.
Of course, I'm just a crazy leftist with these views. And the crazy leftists who issued the Financial Crisis Inquiry report in 2011 echoed them.

"The majority report finds fault with two Fed chairmen: Alan Greenspan, who led the central bank as the housing bubble expanded, and his successor, Ben S. Bernanke, who did not foresee the crisis but played a crucial role in the response. It criticizes Mr. Greenspan for advocating deregulation and cites a "pivotal failure to stem the flow of toxic mortgages" under his leadership as a "prime example" of negligence.

It also criticizes the Bush administration's "inconsistent response" to the crisis - allowing Lehman Brothers to collapse in September 2008 after earlier bailing out another bank, Bear Stearns, with Fed help - as having "added to the uncertainty and panic in the financial markets."

Like Mr. Bernanke, Mr. Bush's Treasury secretary, Henry M. Paulson Jr., predicted in 2007 - wrongly, it turned out - that the subprime collapse would be contained, the report notes."

Bernanke like his companeros in the Bush administration was smug, incompetent, and a key player in a disaster that impacted negatively on most Americans and the world at large. The result of his continuation of Greenspan's policies and his reaction to the onset of the crisis contributed to the reduction of the median net worth of American households by a third:
http://www.nytimes.com/2014/07/27/business/the-typical-household-now-worth-a-third-less.html
Salut, Ben! You deserve every penny.


Roger Gathmann

I mentioned rather cryptically the Yorkville hedge fund that was helped out by the ever hedge friendly Ben Bernanke. In the dark winter of 2008 - 2009, some people thought of the retirement funds that were evaporating, the foreclosures, the unemployment. But the Fed was thinking in larger terms about who should get premium loans at Uncle Ben's We loan for less window. Yorkville was one of them.

"A Jersey City, N.J., hedge fund under Securities and Exchange Commission investigation received more than $230 million in federal loans as part of a government bailout program.

Yorkville Advisors has been part of the Term Asset-Backed Securities Loan Facility Program since last year. Under TALF, the Federal Reserve Bank of New York has up to $1 billion to lend as part of an effort to inject liquidity into the ABS market.
Yorkville received some $233 million of that financing, using it to buy $253 million in securities last year for its flagship, YA Global Investments. The TALF deals were made via a subsidiary of the fund, New Earthshell Corp., and placed with a special-purpose entity called YA TALF Holdings, Forbes reports. The hedge fund still owes the Fed $162 million."
http://www.finalternatives.com/node/13981

This is of course a pennyante amount. You, my friend, may not be able to get one cent from the Fed even if you write them and ask pretty please and include pics of your starving kids, but to other of the higher players in the Wallfare world, that loan is pocket change.
Since it isn't pocket change to me, though (if I and one thousand of my clones worked one thousand years at the rate in which I make money, we would not have collected anything near 230 million dollars), I figure that it might be a good idea to poke around Yorkville Associates, and see what they are about.

So what does Yorkville do, and why would we want to loan it money?

Here's a good summary of one of Yorkville's big money makers:

"Yorkville Advisors, founded by 38-year-old Mark Angelo in 2001, is one of the largest hedge fund firms specializing in investing in thinly-traded and often illiquid outfits by making private investments in public equities, also known as PIPEs. The hedge fund firm reported nearly $1 billion in assets as recently as 2008. Angelo's variation on PIPEs is a structured product called a standby equity distribution agreement, which like most PIPEs often causes the stock of the company receiving the investment to drop because it results in Yorkville's funds collecting discounted shares.

A report prepared by Sagient Research's PlacementTracker shows that Yorkville has entered into $762 million in PIPE deals since 2001, causing the underlying stocks to drop 38% on average in the first year. Most of those investments were made by Yorkville's Cornell Capital Partners, which later changed its name to YA Global Investments.
YA Global Investments reported a total return of 6.04% in 2009 and 6.22% in 2008, its financial statements say. It reported a net investment loss of 0.09% in 2009 and net investment income of 5.43% in 2008.

According to the one-page independent auditor's report prepared on August 13 by McGladrey & Pullen, YA Global Investments' consolidated financial statements include investments valued at $804 million, representing 94% of its partners' capital plus the amounts due to certain Yorkville special purpose vehicles, "whose fair values have been estimated" by Yorkville Advisors "in the absence of readily ascertainable fair values."

Now, that seems a bit curious. We gave this outfit money so that it could use the money to mount a play to make selected stock prices drop, which made it money.

Hmm, how is this possible? Well, here's an explanation of PIPE action as it pertains to another fund, the NIR group, written by Matthew Goldstein at Reuters:

"But what's surprising to me is why the SEC is just looking into the NIR funds now, given that it has been a dominant player in so-called "death spiral" convertible market. These securities have gotten a bad rap over the years because they include a trigger that permits bonds to be converted into common shares whenever there is a precipitous drop in the prices of a company's stock.

Roger Gathmann -> pete...

The accusation is that the loose set up of Talf was Bernanke's baby, not that he was personally on the phone to Yorkville associates.

The Bureau of Mine head wasn't personally in contact with BP when Deep Horizon blew, he had simply helped produced the regulatory environment that made it possible.

Carola Binder said...

A few weeks ago I blogged about Bernanke's decision to join Citadel, hoping the move will catalyze a change in Fed governance: http://carolabinder.blogspot.com/2015/04/on-bernanke-and-citadel.html

Interesting WSJ article on Fed's links to Citadel and Pimco: http://blogs.wsj.com/economics/2015/04/29/ben-bernanke-signs-on-with-pimco-another-firm-not-regulated-by-the-fed-but-with-deep-ties/

Roger Gathmann

Checking out Citadel's history of tax avoidance and taking advantage of loopholes in regulation, Bernanke obviously saw a corporate culture he could admire. As early as 2007, the NYT featured an article about their innovative program of helping employees avoid tax through a system of off shore accounts.

One of the flagship funds at Citadel, a $13.5 billion hedge fund, for example, has deferred at least $1.7 billion since it was founded at the end of 1990. And that does not count what might have been taken out already. Citadel declined to comment.

"We pile advantage on advantage for these managers and there doesn't seem to be any economically logical basis for it," said John C. Bogle, the founder of the Vanguard Group. "It's a very well-gilded lily to allow these tax deferrals."

This tax advantage is now coming under scrutiny in Washington, where Congress is looking for ways to reduce the budget deficit, to pay for the Iraq war and to help cover the exploding retirement and health care costs of aging baby boomers.

For now, many hedge fund managers are enjoying not only extraordinary profits but the extra benefit of a system almost encouraging them to set up offshore accounts.

Most hedge funds are private partnerships; managers are usually paid 2 percent of the money they manage plus 20 percent of the profits the partnership earns. If the fund operates in the United States, any deferral of the pay of the managers means investors lose the tax deduction associated with the compensation expense. As a result, deferred compensation in domestic funds is very uncommon.

By setting up an offshore fund, though, hedge fund managers avoid socking their investors with extra taxes. At the same time, it serves to attract tax-exempt investors like pension funds and endowments, as well as foreign investors, two of the most active groups investing in hedge funds today."

At the end of 2008, things did look bad for Citadel. But they got some help at least from the Government, as did any household who had experienced a bad year - NOT! Just joking. That is when Citadel got a 200 million dollars from the payout of AIG with money loaned from the Fed. http://www.huffingtonpost.com/2009/03/17/aig-bailout-chicago-based_n_175748.html?

Life is sweet. True, what's 200 million between friends? after all, citadel's ceo made 900 million dollars in 2009. That's how they roll.

Roger Gathmann

After the senate report on the financial meltdown, Bernanke, in a country where the elite were more vulnerable to shame, would have stepped down. Actually, if a cashier at a grocery store had a record that was comparably as bad as Bernanke's at the Fed, that cashier would have been fired, with no reference.

But cashiers are peons and proles - they have to take responsibility for what they do. Sweetly enough, our elite has liquidated that notion as far as it refers to themselves. America is such a lovely place to live in like that - if you have an income of above 500 thou a year.

For the rest, well, in an ownership society you gotta take your risks, suckers.

[May 05, 2015] The Higher Immorality

Excerpts from the book The Power Elite by C.Wright Mills Oxford Press, 1956
thirdworldtraveler.com

The higher immorality can neither be narrowed to the political sphere nor understood as primarily a matter of corrupt men in fundamentally sound institutions. Political corruption is one aspect of a more general immorality; the level of moral sensibility that now prevails is not merely a matter of corrupt men. The higher immorality is a systematic feature of the American elite; its general acceptance is an essential feature of the mass society.

Of course, there may be corrupt men in sound institutions, but when institutions are corrupting, many of the men who live and work in them are necessarily corrupted. In the corporate era, economic relations become impersonal-and the executive feels less personal responsibility. Within the corporate worlds of business, war-making and politics, the private conscience is attenuated-and the higher immorality is institutionalized. It is not merely a question of a corrupt administration in corporation, army, or state; it is a feature of the corporate rich, as a capitalist stratum, deeply intertwined with the politics of the military state.

***

There is still one old American value that has not markedly declined: the value of money and of the things money can buy-these, even in inflated times, seem as solid and enduring as stainless steel. 'I've been rich and I've been poor,' Sophie Tucker has said, 'and believe me, rich is best.' As many other values are weakened, the question for Americans becomes not Is there anything that money, used with intelligence, will not buy?' but, 'How many of the things that money will not buy are valued and desired more than what money will buy?' Money is the one unambiguous criterion of success, and such success is still the sovereign American value.

Whenever the standards of the moneyed life prevail, the man with money, no matter how he got it, will eventually be respected. A million dollars, it is said, covers a multitude of sins. It is not only that men want money; it is that their very standards are pecuniary. In a society in which the money-maker has had no serious rival for repute and honor, the word 'practical' comes to mean useful for private gain, and 'common sense,' the sense to get ahead financially. The pursuit of the moneyed life is the commanding value, in relation to which the influence of other values has declined, so men easily become morally ruthless in the pursuit of easy money and fast estate-building.

A great deal of corruption is simply a part of the old effort to get rich and then to become richer. But today the context in which the old drive must operate has changed. When both economic and political institutions were small and scattered-as in the simpler models of classical economics and Jeffersonian democracy-no man had it in his power to bestow or to receive great favors. But when political institutions and economic opportunities are at once concentrated and linked, then public office can be used for private gain.

Governmental agencies contain no more of the higher immorality than do business corporations. Political men can grant financial favors only when there are economic men ready and willing to take them. And economic men can seek political favors only when there are political agents who can bestow such favors. The publicity spotlight, of course, shines brighter upon the transactions of the men in government, for which there is good reason. Expectations being higher, publics are more easily disappointed by public officials. Businessmen are supposed to be out for themselves, and if they successfully skate on legally thin ice, Americans generally honor them for having gotten away with it. But in a civilization so thoroughly business-penetrated as America, the rules of business are carried over into government-especially when so many businessmen have gone into government. How many executives would really fight for a law requiring a careful and public accounting of all executive contracts and 'expense accounts'? High income taxes have resulted in a network of collusion between big firm and higher employee. There are many ingenious ways to cheat the spirit of the tax laws, as we have seen, and the standards of consumption of many high-priced men are determined more by complicated expense accounts than by simple take-home pay. Like prohibition, the laws of income taxes and the regulations of wartime exist without the support of firm business convention. It is merely illegal to cheat them, but it is smart to get away with it. Laws without supporting moral conventions invite crime, but much more importantly, they spur the growth of an expedient, amoral attitude.

A society that is in its higher circles and on its middle levels widely believed to be a network of smart rackets does not produce men with an inner moral sense; a society that is merely expedient does not produce men of conscience. A society that narrows the meaning of 'success' to the big money and in its terms condemns failure as the chief vice, raising money to the plane of absolute value, will produce the sharp operator and the shady deal. Blessed are the cynical, for only they have what it takes to succeed.

***

It is the proud claim of the higher circles in America that their members are entirely self-made. That is their self-image and their well-publicized myth. Popular proof of this is based on anecdotes its scholarly proof is supposed to rest upon statistical rituals whereby it is shown that varying proportions of the men at the top are sons of men of lower rank. We have already seen the proportions of given elite circles composed of the men who have risen. But what is more important than the proportions of the sons of wage workers among these higher circles is the criteria of admission to them, and the question of who applies these criteria. We cannot from upward mobility infer higher merit. Even if the rough figures that now generally hold were reversed, and 90 per cent of the elite were sons of wage workers-but the criteria of co-optation by the elite remained what they now are-we could not from that mobility necessarily infer merit. Only if the criteria of the top positions were meritorious, and only if they were self-applied, as in a purely entrepreneurial manner, could we smuggle merit into such statistics-from any statistics-of mobility. The idea that the self-made man is somehow 'good' and that the family-made man is not good makes moral sense only when the career is independent, when one is on one's own as an entrepreneur. It would also make sense in a strict bureaucracy where examinations control advancement. It makes little sense in the system of corporate co-optation.

There is, in psychological fact, no such thing as a self-made man. No man makes himself, least of all the members of the American elite. In a world of corporate hierarchies, men are selected by those above them in the hierarchy in accordance with whatever criteria they use. In connection with the corporations of America, we have seen the current criteria. Men shape themselves to fit them, and are thus made by the criteria, the social premiums that prevail. If there is no such thing as a self-made man, there is such a thing as a self-used man, and there are many such men among the American elite.

Under such conditions of success, there is no virtue in starting out poor and becoming rich. Only where the ways of becoming rich are such as to require virtue or to lead to virtue does personal enrichment imply virtue. In a system of co-optation from above, whether you began rich or poor seems less relevant in revealing what kind of man you are when you have arrived than in revealing the principles of those in charge of selecting the ones who succeed.

All this is sensed by enough people below the higher circles to lead to cynical views of the lack of connection between merit and mobility, between virtue and success. It is a sense of the immorality of accomplishment, and it is revealed in the prevalence of such views as: 'it's all just another racket,' and 'it's not what you know but who you know.' Considerable numbers of people now accept the immorality of accomplishment as a going fact

***

Moral distrust of the American elite-as well as the fact of organized irresponsibility-rests upon the higher immorality, but also upon vague feelings about the higher ignorance. Once upon a time in the United States, men of affairs were also men of sensibility: to a considerable extent the elite of power and the elite of culture coincided, and where they did not coincide they often overlapped as circles. Within the compass of a knowledgeable and effective public, knowledge and power were in effective touch; and more than that, this public decided much that was decided.

'Nothing is more revealing,' James Reston has written, 'than to read the debate in the House of Representatives in the Eighteen Thirties on Greece's fight with Turkey for independence and the Greek-Turkish debate in the Congress in 1947. The first is dignified and eloquent, the argument marching from principle through illustration to conclusion; the second is a dreary garble of debating points, full of irrelevancies and bad history. George Washington in 1783 relaxed with Voltaire's 'letters' and Locke's 'On Human Understanding'; Eisenhower read cowboy tales and detective stories. For such men as now typically arrive in the higher political, economic and military circles, the briefing and the memorandum seem to have pretty well replaced not only the serious book, but the newspaper as well. Given the immorality of accomplishment, this is perhaps as it must be, but what is somewhat disconcerting about it is that they are below the level on which they might feel a little bit ashamed of the uncultivated style of their relaxation and of their mental fare, and that no self-cultivated public is in a position by its reactions to educate them to such uneasiness.

By the middle of the twentieth century, the American elite have become an entirely different breed of men from those who could on any reasonable grounds be considered a cultural elite, or even for that matter cultivated men of sensibility. Knowledge and power are not truly united inside the ruling circles; and when men of knowledge do come in contact with the circles of powerful men, they come not as peers but as hired men. The elite of power, wealth, and celebrity do not have even a passing acquaintance with the elite of culture, knowledge and sensibility; they are not in touch with them-although the ostentatious fringes of the two worlds sometimes overlap in the world of the celebrity.

Most men are encouraged to assume that, in general, the most powerful and the wealthiest are also the most knowledgeable or, as they might say, 'the smartest.' Such ideas are propped up by many little slogans about those who 'teach because they can't do,' and about 'if you're so smart, why aren't you rich?' But all that such wisecracks mean is that those who use them assume that power and wealth are sovereign values for all men and especially for men 'who are smart.' They assume also that knowledge always pays off in such ways, or surely ought to, and that the test of genuine knowledge is just such pay-offs. The powerful and the wealthy must be the men of most knowledge, otherwise how could they be where they are? But to say that those who succeed to power must be 'smart,' is to say that power is knowledge. To say that those who succeed to wealth must be smart, is to say that wealth is knowledge.

The prevalence of such assumptions does reveal something that is true: that ordinary men, even today, are prone to explain and to justify power and wealth in terms of knowledge or ability. Such assumptions also reveal something of what has happened to the kind of experience that knowledge has come to be. Knowledge is t no longer widely felt as an ideal; it is seen as an instrument. In a society of power and wealth, knowledge is valued as an instrument of power and wealth, and also, of course, as an ornament in conversation.

***

The American elite is not composed of representative men whose conduct and character constitute models for American imitation and aspiration. There is no set of men with whom members of the mass public can rightfully and gladly identify. In this fundamental sense, America is indeed without leaders. Yet such is the nature of the mass public's morally cynical and politically unspecified distrust that it is readily drained off without real political effect. That this is so, after the men and events of the last thirty years, is further proof of the extreme difficulty of finding and of using in America today the political means of sanity for morally sane objectives.

America - a conservative country without any conservative ideology-appears now before the world a naked and arbitrary power, as, in the name of realism, its men of decision enforce their often crackpot definitions upon world reality. The second-rate mind is in command of the ponderously spoken platitude. In the liberal rhetoric, vagueness, and in the conservative mood, irrationality, are raised to principle. Public relations and the official secret, the trivializing campaign and the terrible fact clumsily accomplished, are replacing the reasoned debate of political ideas in the privately incorporated economy, the military ascendancy, and the political vacuum of modern America.

The men of the higher circles are not representative men; their high position is not a result of moral virtue; their fabulous success is not firmly connected with meritorious ability. Those who sit in the seats of the high and the mighty are selected and formed by the means of power, the sources of wealth, the mechanics of celebrity, which prevail in their society. They are not men selected and formed by a civil service that is linked with the world of knowledge and sensibility. They are not men shaped by nationally responsible parties that debate openly and clearly the issues this nation now so unintelligently confronts. They are not men held in responsible check by a plurality of voluntary associations which connect debating publics with the pinnacles of decision. Commanders of power unequaled in human history, they have succeeded within the American system of organized irresponsibility.

[Apr 14, 2015] The Message from the 22 Year Old Suicide at the Nation's Capitol

Apr 14, 2015 | Jesse's Café Américain

Suicide is a prohibited form of violence in my own belief, as are all other forms of murder. Therefore I would not hold this type of protest up as an example to anyone.

However, an even worse offense would be to completely ignore the message which this young man delivered, as most of the mainstream media has done in the US.

I did not even know what really happened until I read this article below from Wall Street On Parade today. The police and media referred to it as a 'social protest.'

Before he killed himself, the young man held up a sign that said "Tax the One Percent."

Perhaps an even more pointed message might be 'shut down the loopholes for the Top .01%.' Those who make their money from wages and ordinary income pay fairly significant taxes.

However, the uber-rich have so many loopholes and tax avoidance schemes that they often pay much lower percentage than even those in the lowest income levels. The top .01% use the upper middle class as shields for their antics.

You may read the entire article about this here.

Rather than one young light be extinguished and quickly overlooked by the powerful, perhaps it would be better if a million people were to march on the Capitol, and effective shut it down in protest this Summer. That might get their attention. Alas, the apathy in the people is pervasive, at least for now.

Wall Street On Parade

22-Year Old Commits Suicide at Capitol to Send Congress a Message

By Pam Martens: April 14, 2015

At approximately 1:07 p.m. on Saturday afternoon, April 11, during the annual Cherry Blossom Festival celebrating springtime in the Nation's Capitol, a 22-year old man took his own life with a gun on the Capitol grounds with a protest sign taped to his hand. According to the Washington Post, the sign read: "Tax the one percent."

Yesterday, the Metropolitan Police Department released the young man's name. He was Leo P. Thornton of Lincolnwood, Illinois. Based on what is currently known, the young man had traveled to Washington, D.C. for the express purpose of making a political statement with his sign and then ending his young life.

The Chicago Tribune reported that "Thornton's parents filed a missing persons report on the morning of April 11 after he never came home from work on April 10, Lincolnwood Deputy Police Chief John Walsh said."

Those are the tragic facts of the incident itself. But there is a broader tragedy: the vacuous handling of this story by corporate media. The Washington Post headlined the story with this: "Rhythms of Washington Return after Illinois Man's Suicide Outside Capitol." The message he delivered to his Congress – tax the one percent – has yet to be explored by any major news outlet in America in connection with this tragedy.

Was the message of Leo P. Thornton of Lincolnwood, Illinois a critical piece of information for this Congress to hear at this moment in American history. You're damn right it was. Outside of Wall Street's wealth transfer system, provisions in the U.S. tax code are the second biggest wealth transfer system to the one percent. Together, these two systems have created the greatest income and wealth inequality since the economic collapse in the Great Depression. They threaten a repeat of the 2008 financial collapse because the majority of Americans do not have the wages or savings to support the broader economy...

Profiles In Hypocrisy, In the Garden of Beasts

08 April 2015 | Jesse's Café Américain

"The only vice that cannot be forgiven is hypocrisy. The repentance of a hypocrite is itself hypocrisy."

William Hazlitt

"The U.S. went off the gold standard in August 1971. With no benchmark, central banks could print money and debase currencies. That opened the door for huge bailouts after big banks screwed up in a big way. Taxpayers-not incompetent bankers-paid the price.

By [the late 1980's], the Federal Reserve Bank and large U.S. banks had established a pattern to control the public relations damage each time banks had a major screw-up: accountants and regulators let banks lie about the size of the problem to stall for time; the Federal Reserve blew smoke at the media; finally, the Fed would bail out the banks in a way that most taxpayers would not understand.

Banks didn't have to get smarter or more competent. The Fed trained the banks that uninformed taxpayers would eat the losses, and fake accounting would let bank officers keep their positions and their money."

Janet Tavakoli, Decisions: Life and Death on Wall Street

Gold and silver were pushed back to their assigned round numbers, with gold barely holding above 1200 and silver pushed well below the 17 handle.

Ted Butler has a rather striking piece about the rigging in the silver market which you can read here.

Speaking of silver it appears that Turkey had record imports of silver bullion in March. You can read about that here. I am not sure how significant that is. We can certainly keep an eye on it to see if this is a one time thing or a trend.

Thoughts of silver drachmas and dirhams come to mind, but it is most likely improbably premature. Still, this is a currency war and things seem to be building to a reckoning of sorts. Who can say what desperate people might do to end repression?

Nothing really happened at the Bucket Shop on the Hudson. A few contracts of silver were claimed, and inventory was shoved around the plate in the warehouses. The real action is taking place in the Mideast and Asia.

We have become a coarse and careless people, smugly confident in our 'Exceptionalism.' We are no longer shocked about lies, but instead critique the style and performance of the liars, and try to emulate them in our own professions.

How can we not cringe at some of the more shocking abuses that pass for generally acceptable behavior in public figures these days? And we encourage it, by both our silence and our acceptance.

Oh yes, we recoil in horror at any kind of sex, at the human form, with great puritanical umbrage, but stealing and cheating, and abusing the poor and the defenseless in even the most petty and vicious ways is looked upon with admiration, because we are in love with power.

Power is our new golden calf. Even some so-called 'reformers' are falling all over themselves at a chance to move near the circles of power, to have influence, to be seen as connected. All we seem to want is to get paid, to get ahead, to 'win.'

Hypocrites!

And the example of our cultural and societal icons are certainly leading to a general corrosion of all morals and civilities. And that is a shame, which eventually will have significant repercussions and consequences for us as a people and a society.

Where will we finally draw the line and come to our senses? How far are we willing to go? How many crimes and abuses, how much theft and torture are we willing to overlook? Why do we allow our society to be defined by sociopaths?

When will we finally look about, and see that we too, despite all our smug superiority, have created our own garden of beasts?

[Apr 12, 2015] Portrait Of American Oligarchy The Very Troubling Income & Wealth Trends Since 1989 by Mike Krieger

Quote: "As of 2013, this group's median annual income stood at about $45,000, down 16 percent in inflation-adjusted terms from 1989, with a big part of the drop occurring since 2001. "
Apr 10, 2015 | Zero Hedge

Submitted by Mike Krieger via Liberty Blitzkrieg blog,

One of the primary purposes of Liberty Blitzkrieg is to dispel the myth that America is politically a democracy and economically a free market, and prove that it is in fact a centrally planned oligarchy. If the people were well aware of this and fine with it, that's one thing, but my contention is that the vast majority of the public is merely buying into the myth. This is why the population is so passive and easily controlled. They simply don't understand what is happening to them. The proverbial frog slowing boiling to death.

Whenever I note that real median incomes in America haven't increased for decades, many people have a hard time believing it. Nevertheless, as John Adams famously proclaimed: "facts are stubborn things." Indeed they are, and an article published today by Bloomberg View provides some disturbingly stubborn facts that must be admitted to and faced. We learn that:

If you worry about the declining fortunes of the U.S. middle class, take heed: It might be worse than you realized.

Tracking the middle class can be difficult, because the group is hard to define. Typically, researchers look at households with incomes or net worth in the middle of the entire population. This approach, though, might provide a falsely rosy picture.

Two economists at the Federal Reserve Bank of St. Louis - William Emmons and Bryan Noeth - sought to address this shortcoming by focusing on households' demographic characteristics, rather than income or wealth. Specifically, they looked at families whose breadwinner was at least 40 years old and had achieved a level of education that would typically allow a middle-class standard of living. Whites and Asians needed exactly a high-school diploma to qualify. For blacks and Hispanics, it took a two-year or four-year college degree - a stark recognition of persistent racial inequality.

The results are not pretty. As of 2013, this group's median annual income stood at about $45,000, down 16 percent in inflation-adjusted terms from 1989, with a big part of the drop occurring since 2001. Over the same period, a more commonly used measure of the middle class's fortunes - the median income for all families - declined just 1 percent.

Yep, since 2001. This is not a coincidence. This is when America reacted like a bunch of scared imbeciles to a terrifying terrorist attack, and squandered what was left of freedom, civil liberties and common sense (see: How I Remember September 11, 2001). But moving along…

The picture for wealth is no better. The group's median net worth (assets minus debt) was about $127,000 in 2013, down an inflation-adjusted 27 percent from 1989 and 38 percent from 2007, just before the financial crisis hit. By comparison, the median net worth for all families declined just 4 percent over the whole period (it's also lower overall because it includes younger families that haven't yet saved much).

While the numbers revealed by this alternative methodology are downright devastating, I'd note that even by the conventional measurement income and wealth are still DOWN since 1989. Don't worry though, oligarchs are more wealthy and more powerful than ever. This is no accident, it's baked into the system.

* * *

For related articles, see:

[Apr 10, 2015] The Government's Revolving-est Doors

Apr 07, 2015 | Zero Hedge

Former employees of federal agencies can often find good (and lucrative) jobs as lobbyists, capitalizing on the connections that they forged while in public service. As OpenSecrets exposes, the numbers of revolving-door-enthusiasts is reminiscent of the Ebola epidemic as this deadly-to-democracy disease spreads from department to department ripping away 'hope and change' wherever it appears. "Revolvers" include those as powerful - and well connected - as secretaries of state and as far from Washington as Peace Corps volunteers... but The Department of Commerce tops the list...

The agencies shown here have employed the greatest number of former lobbyists - or sent the greatest number of former employees to lobbying firms and interest groups.

Agency Number of revolving door people profiled
Dept of Commerce 1736
Dept of Defense 1688
Dept of State 1452
Dept of Health & Human Services 1225
White House 1216
Dept of Agriculture 1112
Dept of Army 1080
US House of Representatives 876
Dept of Justice 864
Dept of Energy 840
Dept of Transportation 750
Dept of Interior 700
Dept of Labor 555
Dept of Housing & Urban Development 530
Dept of Homeland Security 520
Dept of the Treasury 444
Dept of Navy 428
Dept of Education 412
Dept of Air Force 312
US Senate 256

Source: OpenSecrets.org

[Apr 10, 2015] Rahm Emanuel and Rick Perry Hold Public in Bipartisan Contempt by Lambert Strether

April 7, 2015 | nakedcapitalism.com

Lambert here: This post is short and sweet. It's worth reminding ourselves that on some axes of evaluation, Republicans and Democrats are far more alike than different.

By PEU Report. Originally posted on their blog, Private Equity Report.

Holding the public in contempt is a bipartisan effort. Consider the following stories. The first involves Republican Governor Rick Perry of Texas:

Information contained in a blistering state audit shows that at least five of the recipients… which got tens of millions of dollars from the fund - never actually submitted formal applications. At issue are at least five recipients of Texas Enterprise Fund money: Vought Aircraft…

Texas Governor Rick Perry gave Vought, a Carlyle Group affiliate, $35 million for fifteen years. Ten years later it's unclear if Vought provided even one additional new job. Governor Perry's job number is fanciful and the recent audit gives no overall job number. In 2010 Carlyle sold Vought for $1.44 billion but not one penny was returned to Texas taxpayers.

Chicago's Democratic Mayor Rahm Emanuel is as free with taxpayer money for his political benefactors and purposely evasive about those relationships:

Emanuel's administration has for weeks blocked the release of correspondence between his administration and one of the Democratic mayor's top donors, Michael Sacks. The administration has also refused to release details about tens of millions of dollars in shadowy no-bid city payments to some of Emanuel's largest campaign contributors.

Rahm's top donor is a private equity underwriter (PEU):

The CEO of the Chicago private equity firm Grosvenor, Sacks has been described as Emanuel's closest ally in the private sector, and has been called Emanuel's "go-to guy" and his "top troubleshooter."

PEU sponsored politicians are above the law:

Illinois' open records law mandates that communications to and from public officials like Emanuel be made available for public inspection.

Back to how Rahm rewards his donors:

…firms that have received tens of millions of dollars' worth of shadowy "direct voucher payments" (DVPs) from the Emanuel administration have given more than $775,000 worth of campaign contributions to the mayor's political organizations.

Chicago's DVP process is permitted thanks to loopholes in Illinois' procurement law that allow municipal officials to circumvent the traditional contracting process. Unlike standard government contracts, DVP payouts do not require any type of public documentation. Emanuel appointees retain substantial discretionary authority to approve DVPs. The payments are not required to go to the lowest bidder; vendors receiving the payments do not have to list their qualifications and never need to document the services they provide to the city in return for the money. The DVPs appear to have been used for everything from phone service to interest payments to financial firms, but unlike the George W. Bush administration's no-bid contracts, DVP payments do not even require a formal contract, so it is impossible to verify what the money purchased.

No application, no contract and no accountability. It's our PEU world, where politicians Red and Blue love PEU.

[Nov 20, 2014] The NY Fed's Attempt To Explain That It Is Not A Subsidiary Of Goldman Sachs

Nov 20, 2014 | zerohedge.com

The most shocking, if already completely buried, news of the day was that - in yet another confirmation that Goldman Sachs is in charge of the New York Fed - a NY Fed staffer was colluding and leaking confidential, material information to a 29-year-old Goldman vice president, himself a former Federal Reserve employee.

This only happened because on the day Carmen Segarra disclosed her 47 hours of "secret Goldman tapes" on This American Life, Goldman executives asked the former Fed staffer where he had gotten what appeared to be confidential information from.

To nobody's surprise the answer was: The New York Fed. So as the latter, also known as the biggest hedge fund of the western world with $2.7 trillion in AUM, is scrambling to once again prove it is shocked, shocked, that it has become merely the latest subsidiary of Goldman Sachs, Inc., it released the following statement explaining what "really" happened.

From the NY Fed:

As soon as we learned that Goldman Sachs suspected one of its employees may have inappropriately obtained confidential supervisory information, we alerted law enforcement authorities. We have been working with law enforcement authorities since then. Because any public statement about the investigation could be prejudicial to a potential future criminal case, we are unable to comment on the specific facts that are under investigation.

As a general matter, we have detailed rules and controls protecting confidential information. All employees with access to confidential supervisory information need to agree to safeguard that information appropriately, and not to disclose it without the necessary approval. Employees receive training relating to the handling and protection of confidential supervisory information and other information security matters. Employees are informed that a violation of these restrictions could lead to criminal prosecution.

Employees also receive ongoing ethics training and are required to do an annual certification that they understand and will adhere to the Bank's Code of Conduct. In addition, we use off-boarding procedures to confirm with departing employees that no confidential information may be taken. With respect to all New York Fed staff, departing Officers may have no official contact with the Federal Reserve System for a period of one year. In addition, all departing New York Fed employees may not have substantive business contacts with the New York Fed relating to any particular matter that he or she had worked on when employed by the New York Fed. Further, with respect to employees departing from the financial institution supervision group, if the departing employee had served as a senior supervisory officer or central point of contact at a large and complex banking organization, that employee may not receive compensation from the supervised organization as an employee, officer, director or consultant for a period of one year. Finally, the New York Fed has in place technology to help identify and prevent the forwarding of confidential information in violation of our rules.

So did this technology fail? Or is Goldman simply one of the exempted parties?

Selected Skeptical Comments

hedgeless_horseman

Is the NY FED trying to say that Goldman Sachs does not own shares in the New York Federal Reserve Bank?

The 12 regional Federal Reserve Banks, which were established by the
Congress as the operating arms of the nation's central banking system,
are organized similarly to private corporations--possibly leading to
some confusion about "ownership." For example, the Reserve Banks issue
shares of stock to member banks. However, owning Reserve Bank stock is
quite different from owning stock in a private company. The Reserve
Banks are not operated for profit, and ownership of a certain amount of
stock is, by law, a condition of membership in the System
. The stock may
not be sold, traded, or pledged as security for a loan; dividends are,
by law, 6 percent per year.

http://www.federalreserve.gov/faqs/about_14986.htm

Because...

Goldman Sachs Bank USA ("GS Bank") is a New York State-chartered bank and a member of the Federal Reserve System.

http://www.goldmansachs.com/what-we-do/investing-and-lending/banking/

Which is why it is a complete farce and racket to have The NY Federal Reserve Bank be responsible for regulating the member banks that own it.

The Board of Governors of the Federal Reserve System has supervisory and regulatory authority over a wide range of financial institutions, including state-chartered banks that are members of the Federal Reserve System (state member banks), bank holding companies, thrift holding companies and foreign banking organizations that have a branch, agency, a commercial lending company subsidiary or a bank subsidiary in the United States...

http://www.ny.frb.org/banking/supervisionregulate.html

SoberOne
Nice HH.

" Finally, the New York Fed has in place technology to help identify and prevent the forwarding of confidential information in violation of our rules. "

Fancy way of saying the NSA, eh?

insanelysane

insanelysane's picture

It takes two to tango. Goldman wacked a couple of employees but the FED has kept all of theirs. Apparently law enforcement led by Mr. Holder are undertaking another extensive "investigation."

Either that or they are waiting for a memo from Goldman detailing what their "investigation" found.

Bay of Pigs

They don't need to explain anything. The William Dudley's bio....

"Prior to joining the Bank in 2007, Mr. Dudley was a partner and managing director at Goldman, Sachs & Company and was the firm's chief U.S. economist for a decade."

http://www.newyorkfed.org/aboutthefed/orgchart/dudley.html

madbraz

If this was a just country, by now the FBI would have an undercover operation, bug Dudley and KHenry and obtain irrefutable evidence that would be enough to end the NY FED and put them behind bars.

As we don't, and Goldman owns the FBI, we watch and cringe at these masters of arrogance and corruption.

JR

To understand Goldman's ticket to monopoly, the key is the Fed's chain of command.

Since the days of Alexander Hamilton the investment banks have made their home and impact in the Empire State. There, the concentration of big banks has made the NY Federal Reserve Bank powerful enough to outmaneuver, outvote and override all other regional interests. Its Fed ownership position, extensive size, holdings, insiders operating in the Fed and its New York contacts guarantees Goldman Sachs the leverage when needed to direct the Federal Reserve System.

It boils down to this: when you have the kind of leverage Goldman and the TBTFs have, this Wall Street money trust can make the critical decisions. One consortium, Goldman Sachs, tells the NY Fed what to do; it tells the FOMC and it relays its decision to Janet Yellen, representing 90 percent of the banking power. It means the government of the United States is under the direction of the Wall Street money trust.

The Federal Reserve Bank of New York is the feature of how centralized, incestuous and tyrannical America's financial system has become. It is the New York Fed that literally gives the first and last word on who gets what and when in financial America. In other words, when the money trust picks its winners and losers, it's here's where the decisions are made....

Because of the extensive holdings and connections of New York based investment banks, what influence could a St. Louis or Dallas banker possible make on Fed policy? And since the domination of the Fed by Ben Strong of J.P. Morgan Trust and Governor of the New York Fed from 1914 until his death in 1928, no Fed decision is made without the New York stamp.

The president of the New York Fed is a permanent voting member of the FOMC and traditionally is selected as its vice chairman. The other presidents serve one-year terms on a rotating basis. All of the presidents participate in FOMC discussions, but only the five who are members of the Committee vote on policy decisions.

The Federal Reserve Bank of New York has several unique responsibilities associated with its presence in the financial capital of the United States.

At the direction of the Federal Open Market Committee (FOMC), the Federal Reserve's top monetary policy-making group, the New York Fed executes domestic open market operations on behalf of the System.

Open market operations-the buying and selling of U.S. government securities in the secondary market-are the principal means through which the System implements monetary policy. Although the FOMC decides what policy to follow, the System's portfolio is directed, on a daily basis, by the Manager of the System Open Market Account at the New York Fed. The Manager, along with the rest of the Open Market Department, constantly monitors bank reserves and acts to ensure that the FOMC's directive is being fulfilled.

In addition to its domestic trading desk responsibilities, the New York Fed, at the direction of the FOMC and U.S. Treasury, conducts all foreign exchange trading for the Treasury and the Federal Reserve System. In this role, the New York Fed intervenes in foreign exchange markets to achieve dollar exchange rate policy objectives and to counter disorderly conditions in foreign exchange markets.

The New York Fed also is responsible for maintaining relations with, and providing financial services for, foreign central banks and international organizations. One of these services is the New York Reserve Bank's unique custodial responsibility for the gold reserves of about five dozens countries, central banks, and international organizations. The New York Fed's gold vault stores approximately one-quarter of the world's official gold supply-the largest concentration of monetary gold in the world.

Foreign official gold reserves have been held at the New York Fed since 1924 for numerous reasons, including the stability of the U.S. political system, the concentration of international trade and finance in New York City, and the convenience of centralizing gold holdings in a place where international payments can be made quickly.

The truth is, Goldman Sachs is one of the Fed owners, but it is so big, it is pushing everybody else around, at the moment.

The most recent information from observers says that just eight families, four of which reside in the US, own 80 percent of the NY Federal Reserve Bank. They are, according Dean Henderson of Global Research in 2011, Goldman Sachs, Rockefellers, Lehmans and Kuhn Loebs of New York; the Rothschilds of Paris and London; the Warburgs of Hamburg; the Lazards of Paris; and the Israel Moses Seifs of Rome.This ownership information was provided by J.W. McCallister, an oil industry insider with House of Saud connections, writing in "The Grime Reaper," information he acquired from Saudi bankers.

http://www.globalresearch.ca/the-federal-reserve-cartel-the-eight-families/25080

[Nov 19, 2014] Matt Stoller: Lobbying Used to Be a Crime: A Review of Zephyr Teachout's New Book on the Secret History of Corruption in America by Yves Smith

Nov 18, 2014 | nakedcapitalism.com

Yves here. You can also read Zephyr Teachout answering questions about her book at last weekend's Book Salon at Firedoglake.

By Matt Stoller, who writes for Salon and has contributed to Politico, Alternet, The Nation and Reuters. You can reach him at stoller (at) gmail.com or follow him on Twitter at @matthewstoller. Originally published at Medium and Firedoglake

If there's one way to summarize Zephyr Teachout's extraordinary book Corruption in America: From Benjamin Franklin's Snuff Box to Citizens United, it is that today we are living in Benjamin Franklin's dystopia. Her basic contention, which is not unfamiliar to most of us in sentiment if not in detail, is that the modern Supreme Court has engaged in a revolutionary reinterpretation of corruption and therefore in American political life. This outlook, written by Supreme Court Justice Anthony Kennedy in the famous Citizens United case, understands and celebrates America as a brutal and Hobbesian competitive struggle among self-interested actors attempting to use money to gain personal benefits in the public sphere.

What makes the book so remarkable is its scope and ability to link current debates to our rich and forgotten history. Perhaps this has been done before, but if it has, I have never seen it. Liberals tend to think that questions about electoral and political corruption started in the 1970s, in the Watergate era. What Teachout shows is that these questions were foundational in the American Revolution itself, and every epoch since. They are in fact questions fundamental to the design of democracy.

Teachout starts her book by telling the story of a set of debates that took place even before the Constitution was ratified - whether American officials could take gifts from foreign kings. The French King, as a matter of diplomatic process, routinely gave diamond-encrusted snuff boxes to foreign ambassadors. Americans, adopting a radical Dutch provision banning such gifts, wrestled with the question of temptation to individual public servants versus international diplomatic norms. The gifts ban, she argues, was evidence of a particular demanding notion of corruption at the heart of American legal history. These rules, 'bright-line' rules versus 'corrupt-intent' rules, govern temptation and structure. They cover innocent and illicit activity, as opposed to bribery rules which are organized solely around quid pro quo corruption.

The Constitution is full of such bright-line rules. For instance, the residency requirement was intended to protect against 'adventurers' and the takings clause protects private property and has an anti-monopoly interpretive framework. The census, rules on representation of House members, the regular electoral cycle of two year terms, age requirements (to prevent dynasties), requirements for legislative journals, salary payments for legislators, and prohibitions on holding legislative and other offices are all anti-corruption provisions. The founders, Teachout argues, were obsessed with corruption. They had seen their beloved British system fall into the trap of corruption, with 'place men' (members of parliament dependent on the king) and rotten boroughs, and sought to prevent a recurrence in America.

Teachout points out something fairly obvious, but not recognized today - the theoretical underpinning of the American revolution was that a corrupt government had no legitimacy to govern. This is something the founders well recognized. The debates they had - Madison, Jefferson, Adams, Franklin, Washington, Hamilton, and people in the culture at large - reflected a divide between political philosophers Thomas Hobbes versus Baron de Montesquieu. Hobbes's vision, echoed today among the Chicago school's law and economics scholars, was that corruption as a concept made no sense. Life was a brutal competition among selfish actors. In such a paradigm, a revolution would simply be a question of raw power, rather than any set of principles.

The founders roundly repudiated this view, adopting Montesquieu's arguments that there is such a thing as a public interest and that people could orient themselves around it given sufficient personal virtue and adequate structural incentives to do so. Montesquieu is best-known for his promotion of the concept of different branches of government, but that concept came from his moral view of human nature. Teachout shows that questions of bribery were fairly insignificant in the dialogue over the structure of the new republic, whereas anti-corruption as a Montesquieu-influenced deliberative design principle was the key animator of the shaping of the country.

This debate continued, in some sense, throughout the two hundred plus years of American legal and cultural history. The first significant test of the revolutionary anti-corruption doctrine was the 1795 'Yazoo' controversy, when a Georgia legislature sold a massive d process never went away.

In her discussion of the 19th century robber baron era, she includes the critical yet forgotten law of 19th century lobbying. Lobbying today is considered a Constitutionally protected free speech activity, an unfortunate but necessarily tolerated side effect of the First Amendment. That, however, is a relatively recent legal status.

In the 19th century, lobbying was perceived as an illegitimate and inherently corrupt activity, a betrayal of one's own citizenship. The Georgia draft Constitution in 1877 made lobbying a crime. "Throughout the country, from the early 1830s through the early 1930s, the sale of personal influence was treated as a civic wrong in the eyes of the law," she writes. "A citizen did not have a personal right to pay someone else to press his or her legislative agenda." This anti lobbying sentiment was not enforced through criminal law, but through civil law. Contracts for lobbying were unenforceable by courts, as the case Trist vs Child showed.

In 1890, the first law requiring lobbyists to register was passed in Massachusetts. This began the legitimization of lobbying as a profession. In 1927, the Supreme Court began chipping away at the de fact prohibition on lobbying via contract law, but as late as 1941 it still upheld Trist vs. Child.

Corruption in this era was widespread, as was the reaction against it. The Pendleton Act, which created the civil service, and the secret ballot, were both bright-line rule innovations to reduce the temptation of corruption. The country also began wrestling with the increasingly high cost of campaigns, which was a pivotal factor in the election of 1896 contest between populist Democrat William Jennings Bryan and Republican William McKinley. Banks were assessed a .25% charge on capital to finance McKinley's run, which amounted to roughly $5 billion in today's money. This led to, among other things, Teddy Roosevelt's anti-monopoly crusades and his work to ban corporate contributions in the early 20th century.

Corruption was more than just bribery, it was a threat to self-government and individual citizenship. It was a moral problem. Mark Twain's novel The Gilded Age, from which the era took its namesake, was a story of an innocent woman turned sophisticated amoral lobbyist. Corruption as a problem had religious overtones.

Gradually, this ardor has cooled. It was only in the post-World War II era that courts began carving out a First Amendment right on lobbying. Lobbying in the post-war administrative state was a necessity, and the increasing expense of public campaigns suggested that restrictions were necessary. But in 1976, the Supreme Court ushered in the modern Hobbesian view of political economy with its ruling in Buckley vs. Valeo. This case invalidated restrictions on campaign spending, and began the reinterpretation of corruption to simply mean quid pro quo bribery. The court argued that spending on elections in a First Amendment right, though the government had a valid anti-corruption interest in limiting speech. Contribution limits were valid, but spending limits were not. Post Buckley, the only limits on campaign spending became corruption-based, so scholars and lawyers began defining their policy preferences in terms of corruption, twisting and warping the term.

The book's final chapters are a discussion of Citizens United, the Supreme Court's makeup, and a legal proscription of how to restore the more appropriate conception of corruption in our national life.

According to Teachout, Citizens United was a decision in which the Supreme Court ignored the historic record to narrow the definition of corruption to mean a simple quid pro quo transaction. It found that the First Amendment protects "political speech regardless of the identity of the speaker," and that the Court found no sufficient "government interest in limiting corporate political advertising." It equated favoratism and influence with 'democratic responsiveness'. This was, as Teachout shows earlier, what Benjamin Franklin saw to be a dystopian view of how the American republic would be organized.

... ... ...


Minor Heretic, November 17, 2014 at 11:04 pm

A fallacy at the root of the modern 1st Amendment interpretation of campaign finance is just that: money as speech. Consider that high spending candidates win congressional primaries 98% of the time. That 98% is literal – see USPIRG's work on this. That makes donating money analogous to voting, not speaking. Last I checked, we were each supposed to have an equal number of votes, namely one.

Just throwing this out: Limit political donations (to candidates, parties, PACs, ballot initiative movements, lobbying organizations, 501(c)4…) to a day's wages at the federal minimum wage. It would also be the annual maximum. That's $58 at the present level. David Koch and the guy who mows David Koch's lawn would have equal clout.

Going further with the idea of money-as-vote, there should be a constituency restriction. Why should a resident of Ohio be able to influence the outcome of an election or ballot initiative in California? For that matter, why should a resident of Ohio congressional District 1 influence the elections of a representative for Ohio District 2? In neither case would the donor have legal party status.

I'm going to read Teachout's book. I should note that her sister Woden co-wrote an excellent book called "Slow Democracy," about the practice of direct deliberative democracy, including (but not limited to) town meetings.


Sam Kanu, November 18, 2014 at 8:54 am

"Money = free speech" is the ultimate fallacy. If money is equal to speech, then per definition, speech cannot be free or equal, as we have huge disparities in wealth. And in turn that means we dont have a democracy.

So basically the courts have dictated that democracy is dead. But that is not news on these pages, where it has long been obvious that we live in an oligarchy….


Paul Tioxon, November 18, 2014 at 5:53 am

The corruption of the Gilded Age included the buying of US Senate offices. Mark Twain in particular wrote against the practice whereby state legislatures picked the US Senators for a state, without any direct election by the citizenry. One of the richest men in world, William A. Clark, The Copper King of Montana, paid off the entire legislature of that state to become its appointed Senator. Finally, the the 17th Amendment to the US Constitution provided for the direct election of US Senators. Today, another institutional barrier to democratic elective office is the Congressional District. When I vote for a Senator, we have state wide elections, not 1 of 2 Senatorial Districts. When I vote in PA for my Congressional representation, I am only voting for a tiny fraction of my full representation, due to my being forced to vote for only one candidate in my congressional district. PA has 18 districts because it has to follow the law that provides for this organization. I should get to vote for all 18 of the federal representatives, because I am a citizen of Pennsylvania, which enter the Union of the USofA.

The districts are not hallowed institutions, because they keep changing with the growth in population of the nation. And I, get to vote for some frequently redrawn district that keep the amount of Republicans going to Washington DC in numbers greater than the total vote count for their party for each of their district races. I want a vote fore each representative, no matter how many there are for my state. Some small states with only 1 representative have a statewide election. That is what I want for all of the citizens with more than 1 representative. If I had 18 votes, I could vote 18 times for a Democratic slate of reps or maybe 12 Dems and 6 Green Party reps. As it stands now, 17 or the 18 people who represent my state get to go to DC without my consent. I am not 1/18th Pennsylvanian and I don't want 1/18th of a voice in Congress. One person, One vote, for One Candidate. How come I can't vote for the rest of my state's delegation to Congress. Oh yeah, we might take over the government mechanism of decision making.

beene, November 18, 2014 at 7:54 am

To me this is the most outrageous settle law that we have failed to address in over two hundred years (to the Supreme Court, where in 1810, in Fletcher v Peck, the court said that the sanctity of the contract must be upheld even in the face of corruption. In a nod to today's logic of brutal tolerance of corruption, the court argued that corruption may be problematic, but there was nothing the state could do about it. This was a highly consequential decision, and prioritized contract rights over anti-corruption.).

cabjoe mentioned voters being able to vote on approval of any new law passed by our representatives seems like an excellent correction to a lot of corruption by law makers.

Linda Amick, November 18, 2014 at 8:30 am

As a post grad student of Historical Philosophy, I find it absolutely shocking that our societal first principles are Hobbesian. His view of human dynamics and behaviors is MIGHT MAKES RIGHT. Human beings are nothing more than brutes.

If our societal viewpoint was Aristotelian with man being a rational animal and part of the living organism of the earth and solar system with a responsibility to respect all parts, maybe our society would find its basis in something more akin to the Golden Rule.


Jim, November 18, 2014 at 5:25 pm

Mr. Hobbes, I believe, has inappropriately been maligned by many of the posts on this particular thread when making allusions to his moral psychology.

If you take a more careful look at his writings you might notice that Hobbes is concerned with cultivating a personality type concerned with honor. Hobbes says

"That which gives to human actions the relish of justice is a certain nobleness or gallantness of courage, rarely found, by which a man scorns to be beholden for the contentment of his life to fraud, or breach of promise. The justice of the manners is that which is meant, where justice is called a virtue, and injustice a vice." (Leviathan, Chapter 14).

When talking about the first steps in the transition from the state of nature to a social contract Hobbes seems to believe that at least some members of the original society have to be of a sufficiently magnanimous temperament that they are willing to take unprecedented risks for the benefit of all.

Hobbes identifies magnanimity with the just conduct that springs from a "contempt" of injustice, and he seems to recognize that men are often prepared to risk their lives rather than suffer some sorts of shame. He also says that "magnanimity is a sign of power."(Leviathan, Chapter 10)

JTMcPhee , November 18, 2014 at 8:31 am

Speaking of corruption, moral hazard and all that related badness, years ago I was in the man cave of a person busy in the open-outcry activity at the CME. Up on his wall in a florid frame was the front page from a Chicago Tribune dated as I recall in august 1852. The headline story reported he criminal conviction of two fellas for engaging in "speculation" on the future price of corn, or maybe pork - back then, the stock in trade of the CBOT/CME today was totally illegal, even barred by the Illinois constitution, for a lot of reasons that reflect the pain that smartass "speculation" and derivatization have and continue to cause:

The Struggle for Legitimacy

Nineteenth century America was both fascinated and appalled by futures trading. This is apparent from the litigation and many public debates surrounding its legitimacy (Baer and Saxon 1949, 55; Buck 1913, 131, 271; Hoffman 1932, 29, 351; Irwin 1954, 80; Lurie 1979, 53, 106). Many agricultural producers, the lay community and, at times, legislatures and the courts, believed trading in futures was tantamount to gambling. The difference between the latter and speculating, which required the purchase or sale of a futures contract but not the shipment or delivery of the commodity, was ostensibly lost on most Americans (Baer and Saxon 1949, 56; Ferris 1988, 88; Hoffman 1932, 5; Lurie 1979, 53, 115).

Many Americans believed that futures traders frequently manipulated prices. From the end of the Civil War until 1879 alone, corners – control of enough of the available supply of a commodity to manipulate its price – allegedly occurred with varying degrees of success in wheat (1868, 1871, 1878/9), corn (1868), oats (1868, 1871, 1874), rye (1868) and pork (1868) (Boyle 1920, 64-65). This manipulation continued throughout the century and culminated in the Three Big Corners – the Hutchinson (1888), the Leiter (1898), and the Patten (1909). The Patten corner was later debunked (Boyle 1920, 67-74), while the Leiter corner was the inspiration for Frank Norris's classic The Pit: A Story of Chicago (Norris 1903; Rothstein 1982, 60).14 In any case, reports of market corners on America's early futures exchanges were likely exaggerated (Boyle 1920, 62-74; Hieronymus 1977, 84), as were their long term effects on prices and hence consumer welfare (Rothstein 1982, 60).

By 1892 thousands of petitions to Congress called for the prohibition of "speculative gambling in grain" (Lurie, 1979, 109). And, attacks from state legislatures were seemingly unrelenting: in 1812 a New York act made short sales illegal (the act was repealed in 1858); in 1841 a Pennsylvania law made short sales, where the position was not covered in five days, a misdemeanor (the law was repealed in 1862); in 1882 an Ohio law and a similar one in Illinois tried unsuccessfully to restrict cash settlement of futures contracts; in 1867 the Illinois constitution forbade dealing in futures contracts (this was repealed by 1869); in 1879 California's constitution invalidated futures contracts (this was effectively repealed in 1908); and, in 1882, 1883 and 1885, Mississippi, Arkansas, and Texas, respectively, passed laws that equated futures trading with gambling, thus making the former a misdemeanor (Peterson 1933, 68-69).

Two nineteenth century challenges to futures trading are particularly noteworthy. The first was the so-called Anti-Option movement. According to Lurie (1979), the movement was fueled by agrarians and their sympathizers in Congress who wanted to end what they perceived as wanton speculative abuses in futures trading (109). Although options were (are) not futures contracts, and were nonetheless already outlawed on most exchanges by the 1890s, the legislation did not distinguish between the two instruments and effectively sought to outlaw both (Lurie 1979, 109).

In 1890 the Butterworth Anti-Option Bill was introduced in Congress but never came to a vote. However, in 1892 the Hatch (and Washburn) Anti-Option bills passed both houses of Congress, and failed only on technicalities during reconciliation between the two houses. Had either bill become law, it would have effectively ended options and futures trading in the United States (Lurie 1979, 110).

A second notable challenge was the bucket shop controversy, which challenged the legitimacy of the CBT in particular. A bucket shop was essentially an association of gamblers who met outside the CBT and wagered on the direction of futures prices. These associations had legitimate-sounding names such as the Christie Grain and Stock Company and the Public Grain Exchange. To most Americans, these "exchanges" were no less legitimate than the CBT. That some CBT members were guilty of "bucket shopping" only made matters worse! http://eh.net/encyclopedia/a-history-of-futures-trading-in-the-united-states/

The Players reported on in that Tribune article, as I recall, were convicted of multiple felonies, and sentenced to something like 15 years each in pre-privatization Illinois prison.

And another example of the fun and games, and how libertarianism actually operates if allowed: Remember the Onion Corner scam, again centered in Chicago? http://en.wikipedia.org/wiki/Onion_Futures_Act

I'm old enough and cynical enough to know that there's an irreducible amount of corruption, some cheerful but most perverse, in any social organization. The constant problem is managing what I'd call "slack," the apparently necessary "play" in the system, that like mechanical tolerances in timepieces and transmissions, keeps friction and heat from locking up the mechanisms. I doubt we humans will ever be very successful at keeping the "sharpest" among us from fattening themselves via fraud, abuse, theft, combination and all that - there are no incorruptible mechanisms that can keep the "slack" to a level that like, our gut bacteria population does not proliferate and degenerate into a disease state that threatens to kill us, the organism of ordinary people that keep all this going with our work and our little bits of wealth…

blucollarAl November 18, 2014 at 9:15 am

The entire philosophical and ideological foundation of modern capitalism, the almost always unquestioned because unrecognized and assumed anthropological and moral premises of the system of organizing economic and social life, is Hobbesian in its roots and accepts a Hobbesian picture of the universe. What passes today for the "American Conservative Movement", that collection of foreign policy neo-cons and economic/social neo-liberals that deceptively calls itself "conservative", suggesting a respect for if not a reverence for the traditional and older ways, represents in fact a radical, anti-American tradition of Hobbesian political philosophy as Treachout seems to recognize in her book (I have not yet read it).

Still the best treatment of the Hobbes and modern capitalism are Hannah Arendt, "The Origins of Totalitarianism", Chapter 5, "The Political Emancipation of the Bourgeoise", and C.B. McPherson, "The Political Philosophy of Hobbes". Read them and weep.

So we have a radical, anti-American, anti-human philosophy based on a picture of human nature as pure passion, aggression, power-hungry greed, appealing to ordinary Americans under the guise of "conservative" respect for their cherished (what's left) customs, traditions, and respect for decency. It is as if we have all fallen into a deep trance with no one, certainly not today's Democrat Party, there to wake us up.

JTMcPhee November 18, 2014 at 4:26 pm

Even The Capitalist Tool, and the Economist (sic), and the OECD (and of course the keepers of order, the military and state security types) know the pot is already simmering, the flame is turned up and all that:

Even that apologia for More Of The Same, The Economist: "For richer, for poorer: Growing inequality is one of the biggest social, economic and political challenges of our time. But it is not inevitable, says Zanny Minton Beddoes," http://www.economist.com/node/21564414 (Neither are heart disease and cancer, sort of…)

On the Big War side of things, " Pentagon preparing for mass civil breakdown: Social science is being militarised to develop 'operational tools' to target peaceful activists and protest movements," http://www.theguardian.com/environment/earth-insight/2014/jun/12/pentagon-mass-civil-breakdown, and unless one really enjoys depression and self-flagellation, it does not pay to research the crowd control technologies our young innovators are handing to the rich shits and their "people."

The "elite," having lucked into the knack of creating a Black Hole to suck in all the resources and wealth of everyone else, of course need "Security" to not only hang tight to what they have grabbed, but to keep anyone else from picking off a few crumbs. More from Forbes:

Security Concerns Of The Super-Rich

Worried about someone hacking into your offshore bank account? Kidnapping you and holding you for ransom because of your high net worth? Breaking into your Caribbean villa while you're working from lower Manhattan?

Those aren't concerns for most of us, but for the extremely wealthy they could be. Trite as it may seem, the rich really are different from you and me. Especially when it comes to security…." http://www.forbes.com/sites/brianwingfield/2010/10/20/security-concerns-of-the-super-rich/

And all those ex-imperial military types, loaded for bear and needing a paycheck… "retainers", isn't that the old term?

Katie, bar the door!

ex-PFC Chuck November 18, 2014 at 11:43 am

Judging from this review, Teachout's book covers much of the same ground that Larry Lessig did three years ago in Republic, Lost. In that book, Lessig drew considerably on Teachout's earlier work in this area. He used the terms "dependence corruption" and "systematic corruption," to describe features and practices that undermine the peoples' influence on government but are not illegal, and differentiates them from quid pro quo corruptions such as bribery. He describes at length how dependence corruption was a major concern of the founders. Here are some links for people interested in doing something useful in this area:
movetoamend.org
http://wilpf.org/CvDCmte
http://www.wilpf.org/docs/ccp/corp/ACP/CP_article%2Btimeline.pdf >

juliania November 18, 2014 at 12:42 pm

Many thanks for this review, Yves!

"…Teachout shows, through painstaking historical research, that this popular conception of corruption is actually far more consistent with the intent of the Constitutional framers than the odd and anomalous John Roberts-led Hobbesian majority…"

In my small liberal arts college back in the early '60′s we were reading the papers of the framers of the Constitution, after having read works by the English philosophers, and what I remember of Hobbes boils down to his description of the lives of human beings as being 'nasty, brutish, and short.' (Consequently when I think of Hobbes in my mind he takes on that persona – nasty, brutish, and short.) Teachout's analysis of Citizens United is extremely interesting; I always thought the Constitution was crafted with Hobbesian realities in mind; that was what 'checks and balances' were all about. It was never 'just a piece of paper' but you had to toe the line it brightly (love that appellation) laid out.

Always until now the better angels of our nature were not just folderol propaganda, given occasional lip service and nothing further, but also verities enshrined in our founding documents, to be treasured and protected – how far we have come away from that glorious heritage!

Maybe we are approaching the turning point.

Sluggeaux, November 18, 2014 at 4:18 pm

"I believe that the common character of the universe is not harmony, but hostility, chaos, and murder." - Werner Herzog, Grizzly Man

As one of the few people in this country who seems to have actually read the opinions which make up the Citizens United decision, I believe that our Constitution represents an effort to overcome a Hobbesian world by those who well understood the brutish instincts of their fellow human beings.

Kennedy actually relies on dissents penned by William O. Douglas and Earl Warren to decisions affirming the muzzling of collective political action by organized labor under the Taft-Hartley Act passed in the wake of the Second World War at the beginning of the McCarthyite Red Scare.

Eight of the nine Justices agreed with Kennedy that collectively spending money on political communication is protected by the First Amendment, but that the Congress may constitutionally require that the speaker(s) be transparently identified (only Thomas dissented from this view).

It is the Congress which has corruptly failed to act on the Supreme Court's invitation to ban "Dark Money" and force political speakers to identify themselves and their agendas. Such sunshine would make their corruption far more difficult.

Jim, November 18, 2014 at 5:55 pm

I think you should try to keep in mind that Hobbes was also a theoretician of skepticism, something which seems in extremly short supply in 2014.

Hobbes's has said "For the thoughts are to the desires, as scouts, and spies, to range abroad, and find the way to the things desired (Leviathan, Chapter 8).

As with Hume, Mr Hobbes argues for a certain type of circularity in our arguments where the reasons generated by reason are largely concerned with clarifying the ends to which are passions are driving us and in figuring out the most expeditious means for getting there.

In other words, in contrast to, say, the political theorists of MMT (at least in their earlier versions) there is a powerful argument in both Hobbes and later Hume for the primacy of the prescriptive over the descriptive -– if we are honest with ourselves.

Jim, November 18, 2014 at 3:44 pm

"The founders…adopting Montesquieu's arguments that there is such a thing as a public interest and that people could orient themselves around it given sufficient personal virtue and the adequate structural incentives to do so."

But if the general public tends to lack virtue and "double government" becomes institutionalized then what are we to do?

The recent article/book by Michael J Glennon "National Security and the Double Government" deals directly with the profound issues of personal virtue and structural checks and balances.

Glennon argues that we have created, especially in the area of national security, a type of double government–one part public (Congress, the President, and the courts) and the other more concealed were several hundred executive officers in the military, intelligence and law enforcement agencies are basically responsible for protecting the nation's security and have acquired unchecked power–which accounts for the same imperial foreign policy no matter who is Preseident as well as our incrementally collective moves towards totalitarianism,.

The result of such an situation, according to Glennon, is a negative feedback loop were resuscitating the more Madisonian institutions (Congress, Presidency, Courts) requires an informed, engaged electorate (civic virtue) which is simultaneously faced with a political structure that has locked them out–thus voters have little incentive to become informed or engaged and in fact often appear to be moving toward greater unengagement

Glennon finishes his analysis with a quote from John Adams: "The nation which will not adopt an equilibrium of power must adopt a despotism. There is no other alternative."

Walter Antoniotti, November 18, 2014 at 8:04 pm

What bothers me is how few educated people don't know this. John Hamilton, a bootlegger, paid for the Minutemen so he would not have to pay taxes for British protection. People should read Lies My Teacher Told Me and Don't Know Much about history.

People like David Brooks really thinks now is a really bad time. Compared to 1962-1982 things are great. Lets compare US citizens killed in wars, assassinations, the misery index, the social net, income of old people, corrupt politics, riots in cities, students killed on college campuses…

[Nov 17, 2014] Bill Black and Marshall Auerback Discuss Why Economists and Regulators Don't Use "Fraud"

Quote: "I believe that the fraudulent nature of the GWOT (Global War on Terror) should be a key ingredient of any analysis of our political situation and it should be looked at as a part of the massive financial fraud of that period–the two are not separate. "
Nov 15, 2014 | nakedcapitalism.com

Yves here. Bill Black discusses his favorite topic, fraud, with Marshall Auerback of the Institute of New Economic Thinking. Some of this talk is familiar terrain for those who know Black's work, such as Black's well-argued criticism of the failure of financial regulators to make criminal referrals for misconduct in the runup to the financial crisis.

Even so, many readers are likely to find new information here, such as the number of FBI agents assigned to handle white collar fraud, and how some regulators during the savings & loan crisis defied Congressional pressure to go easy on failing and defrauded banks, and the career costs they paid.

Watt4Bob, November 15, 2014 at 9:15 am

In retrospect it seems likely that taking the FBI off the financial crimes beat and putting them on terrorism beat was a strategic move on the part of DOJ, at the behest of Wall$t interests.

After all, they passed the bankruptcy reform act well ahead of time because they foresaw the need to prevent our escape from the coming crisis, evidence they have some overall understanding of the likely results of their behavior.

Why then would we doubt they plan ahead to forestall prosecution for their crimes by systematic gelding of regulators and Justice to create a backstop?

(Not mention the missing $ trillions Rumsfeld admitted to congress on 9/10/01, and the subsequent attack on the Pentagon that managed to destroy only the offices of the guys auditing the MIC books?)

Banger, November 15, 2014 at 10:02 am

The way officials dealt with the massive financial fraud during the aughts, particularly the Obama Administration, was the final nail on the coffin of the U.S. government. There is no way to argue that we have a legitimate government in Washington. First 9/11 and the Global War on Terror a totally bogus and Orwellian enterprise that took FBI agents out of their jobs chasing wild geese or focusing on dissidents like Occupy protesters. I believe that the fraudulent nature of the GWOT should be a key ingredient of any analysis of our political situation and it should be looked at as a part of the massive financial fraud of that period–the two are not separate.

The rest of the federal government will collapse into the most sordid kind of political corruption eventually though this will take some time since most bureaucrats, dispirited as many of them are, are not constitutionally corrupt or corruptable – but eventually the Washington maxim of "no good deed goes unpunished" will win out. When I say corrupt, btw, I mean structural corruption not a few people selling their services to the people they regulate – I mean the corruption we have today is sytemic and incurable. Reform cannot happen at this time–there are no political forces that have a) articulated how bad the situation actually is (if criminals suffer no consequences then criminals will flourish); and b) know how to do anything to remedy the situations. The mainstream media and even the financial press is an integral part of the system that is focused on disinformation and misdirection with, at least, the occasional article that shows a little glimpse of the ankle of this situation.

Anyone familiar with the work of Black and many others that does not grasp that a system that rewards its worse criminals is, essentially, a criminal system. It is as if organized crime has taken over the U.S. and we haven't even noticed! Where is Batman?

fresno dan, November 15, 2014 at 12:09 pm

The one good line Kinsley has, "the outrage is not what's illegal, its what's legal".

The 0.1% have 24/7 access, and no one else does. These government people cannot even fathom what is wrong, because they are never actually exposed to another viewpoint…

susan the other, November 15, 2014 at 2:59 pm

That Holder said it might be "fraud" but he wasn't touchin' it with a 10-ft pole, is a quote to die for. I must ask then, isn't the US financial system a classic SOE? Indeed it is.

China eat your heart out. So it follows that MMT doesn't necessarily apply in this case because our system divvies up the money unequally by design and not equally (also by design) – ergo corporatist design. Nevermind that 90% (?) of our corporations are terminal.

Giving the banksters (partners in crime) a lavish allotment mostly to allow them to then support the MIC and etc. God praise private banking, er, agency banking. So what's not to love about Bill Black's wonderfully graphic description about the authorities denying "fraud" as "suddenly realizing you are in an elevator with a crazy person."

And it then almost makes me think, in my entrenched paranoia, that the S&L crisis might have merely been a dry run.

EconCCX, November 15, 2014 at 8:39 pm

I do not know "SOE". What does it refer to?

State-owned enterprise, probs. "China eat your heart out."

barbara gibbs, November 15, 2014 at 4:10 pm

When you have CEO's like Jamie Diamon who goes before Congress wearing White House cufflinks, he pretty much gave the finger to Congress. and Obama saying they did nothing wrong, is why I lost my support for President Obama.

Obama why did you have to suck Diamon's dick?

TedWa, November 15, 2014 at 5:22 pm

Even the Financial Crisis Inquiry Commission (FCIC) was told they could never use the word "Fraud" in their investigations. Sick, isn't it – and sickening.

I can't wait to hear how Holder is going to answer the questions about Alayne Fleischmann, the former JPMorgan Chase securities lawyer who tried to blow the whistle on "massive criminal securities fraud" by the bank and Jamie Dimon, only to have the government try to silence her with a $9 billion settlement.

Like we've been trying to say for years, you can prosecute the TBTF's.

Cultural Capture and the Financial Crisis By James Kwak

Oct 9, 2014 | The Baseline Scenario
41 comments
A few years ago, while still in law school, I was invited to write a chapter for a Tobin Project book on regulatory capture. It was a bit intimidating, being part of a project that included luminaries like David Moss, Dan Carpenter, Luigi Zingales, Richard Posner, Tino Cuellar, and the deans of two of the best law schools in the country. I was asked to write something about an idea that I had slipped into 13 Bankers, almost in passing, about the cultural prestige of the financial industry and the political and regulatory benefits the industry derived from that prestige. My chapter turned into a discussion of the various mechanisms by which status and social networks can influence regulators, creating the equivalent of regulatory capture even without traditional materialist incentives (cash under the table, promises of future jobs, etc.).

Two weeks ago, an investigation by ProPublica and This American Life illustrated the culture of deference, risk aversion, and general sucking-upitude among New York Fed bank examiners that effectively resulted in the capture of regulators by the banks they were supposed to be regulating. As David Beim wrote in a confidential report about the New York Fed, the core problem was "what the culture expected of people and what the culture induced people to do."

I wrote about the story for the Atlantic and referred to my book chapter, but at the time the chapter was not available for free on the Internet (at least not legally). The good people at the Tobin Project have since put it up on the book's website, from which you can download it (legally!). Note that they are only allowed to put up one chapter at a time and they rotate them, so this is a limited-time offer.

Anonymous | October 9, 2014 at 10:20 am

Regulatory Capture is a very serious issue. When groups or individuals have a high-stakes interest in the outcome of policy or regulatory they often focus their resources and energies in attempting to gain the policy outcomes they prefer, while members of the public, each with only a tiny individual stake in the outcome, are unable to do anything about it.

Cladia | October 9, 2014 at 10:23 am

When groups or individuals with a high-stakes interest in the outcome of policy they often focus their resources and energies in attempting to gain the policy outcomes they prefer, while members of the public, each with only a tiny individual stake in the outcome, have no power to effect the outcome.

this is a pure form of hierarchy.

joebhed | October 9, 2014 at 9:35 pm

Sorry, the relevant paradigm goes far beyond the natural outcome of having a regulator work within a bank, people being people and all.

But that administrative failure and its resulting Rolex-seeking bedfellows all pale in comparison to the deeper realty present having to do with the dual mandate of the Fed to regulate the banks while being in charge of the money system that those banks operate to maintain our economic output and stability.
Be either the regulator or the promoter of the banking industry.

The Fed's mandate to do both, from the same room, is morally perplexing to good people, and is economically paralyzing.

We can't have the money to put us back to work until bankers see robust creditwortiness for lending and profit opportunities , which cannot happen without more money ….. to make them more creditworthy.. Catch 22 of debt-based money.

This is why Martin Wolf says the government should issue the money.

One less moral hazard.

Henry | October 11, 2014 at 5:32 pm

It is sickening how regulators seek personal benefit, with complete disregard for the needs of the many that should outweigh the needs of the very few. The fact that the same people have to both regulate and promote banking activity is a recipe for corruption. Regardless of cultural background of regulators and examiners, they should not have the power causing them to reach a moral dilemma.

tonyforesta | October 13, 2014 at 1:30 am

Crimes were committed by all the financial oligarchs on an epic scale. Fraud, insidertrading, price manipulation, tax evasion, naked massive theft, bribery, collusion, market rigging, and the list is long and festering and putrid. The same crimes, by these same oligarchs, peopled with the same den of vipers and thieves continue today unabated on an even more epic, epochal scale.. There is nothing "unconscious" in the capture and conduct of the socalled regulators. Both those pursuing the capture and the socalled captured are equally guilty of the same crimes, for the same unholy pyshopathic reasons. Wealth and power.

Either regulators regulate and enforce existing laws. or there are no laws. The laws are reduced to endless reams of meaningless words on worthless paper, full of sound and fury, signifying nothing." The conjuring of debt products into assets is a criminal activity, a Ponzi scheme. Derivative products amount to (and the numbers are nebulous) a $600Billion exposure. 3/4′s of a Quadrillion. How is this possible? How will this exposure ever be reconciled? The entire global GDP is only 70+ trillion. There is no fixing this rank evil, there is no balm in Gilead. How will this unholy and criminal math ever be reconciled???? I beg anyone to answer any of these inquiries.

Part of the problem is the cognitive capture of academics, politicians, regulators, law enforcement, and the dimsheeple these shaitans rob, pillage, incarcerate, murder, and otherwise abuse. The language used itself deceptive and cloaked in the insular supremist ideologies and beliefs in wealth and subsequent power as the singular measurements of status and greatness, of socalled "masters of the universe". Terms like captilalism, market efficiency, freemarkets, jobcreators, patriotism, and christianity, freedom, democracy have been intentionally and ruthlessly mangled and dismembered and redefined by decades of wingnut propaganda covens information domination operations, and disinformation campaigns. For example. – I double dare any of you erudite experts to define capitalism or democracy or freemarkets, or market efficiency and get back to me. The definitions no longer apply to the realities or the facts. Fascists and oligarchs rule Amerika and control the wealth and resources nation and all the conduct of the socalled government, enforced by militarized mass murdering biggoted pigs, – I mean police, – excused and shielded by partisan judges, including the fascists in the supreme court, and the captured regulatory apparatus, who favor, shield, protect, advance and insulate the fascists predatorclass and their mindless thugs – so obviously – we here in the land of Oz no longer inhabit a democracy,

Capitalism? Freemarkets? If there ever were such things, – they certainly does not exist today The markets are better defined as bandit capitalism and certainly not free, or fair, – wherein an entrenched predatorclass den of vipers and thieves are free, because of massive systemic criminality and theft, and the ensuing absurd illgotten imponderable wealth, to wantonly rob and pillage the people and manipulate markets, commodities, resources, the socalled judicial system, the socalled regulatory apparatus, the mass murdering militarized pigs, – I mean socalled law enforcement, and the socalled government, with absolute impunity and immunity, and zero accountability.

Market efficiency? The socalled mastersoftheuniverse were and are today wildly and dangerously stupid and horribly inefficient, and are singularly responsible for the most catastrophic economic FAILURE in the sordid history of the world, – a catastrophic FAILURE that is ongoing, and metastasizing on an exponential level today.

Christianity? Personally loath all institutional religions, as they are all awash in oceans of innocent blood, and seek only profit and power through the manipulation of religion – but also a student of comparison religion, including the bible, the apocrypha, and the Nag Hamadi texts. Any fiend or shaitan that would besmirch, bastardize, and claim the Nazarene to justify their evils promoting wealth, and biggotry, racism, sexism, and homophobia – is obviously woefully uneducated on the true teachings of christianity.

You are all victims of "pecuniary logic" and "pecuniary – psuedo truth" beliefs, – where in lies are majikally shapeshifted into truths, and truths denounced and the babbling of conspiratorialists.

The EPA, note the key term ENVIRONMENTAL in the name of the agency should be "captured by ENVIRONMENTAL types. That is the point the the purpose of in protection mandate in service of the people.

The creature from Jekyll Island, or the socalled FED is a horrific FAILURE, or a CRIMINAL CARTEL, or both. Regardless of the incessant bruting of the complicit parrots in the MSM, and the spaniels in the regulatory apparatus – there is no growth, there are and never will be any meaningful jobs, and inflation (again setting aside the manipulated and intentionally deceptive conjured numbers these shaitans and fiends pimp) is rampant and brutal, for the 99%. Price bacon, or cheese, or any staple, or healthcare, or rent, or car insurance, and get to me biiiiiaaatches.

The fact is CRIMES were committed. The economy collapsed.to the great disadvantage and disregard of the poor and middle class, while the predatorclass has absconded unfathomable wealth and protections. And the shaitans and fiends in the socalled government and regulatory apparatus chose to shield advance, protect, and immunize the den of vipers and thieves who are singularly responsible and culpable for this horrorshow.

Insular supremists pimp and brute the fiction that if the banks were not bailed out at the taxpayer expense, – the world would have come to an end.

Why would any intelligent free thinking individual, knowing what this den of vipers and thieves were responsible for, recognizing how much imponderable wealth these shaitans absconded believe this fiction and myth.

We'll never know. But a resolutiontrustlikeentitiy could have commandeered the banks, dissolved their criminal enterprizes, sold what was left in the open markets, sent those responsible to court, and eventually jail, – and no of you could ever convince me – that those in my circles would not be much better off.

Defenders of the predatorclass are pathological liars. CONSCIOUSLY, for inclusion and the grim hope someday walking the earth as predatorclass.

This is psychopathic and sociopathic depravity, criminality and insanity, only possible when one renounces every particle of humanity, decency, morality and compassion – and any concern for their fellow man.

The reality predatorclass shaitans and fiends and vipers and thieves will face – beyond the inevitable and certain collapse of the socalled global financial system – is that some of us in the 99% will not forget or forgive, and there will be a reckoning, and there will be blood.

In a world where there are no laws, – there are no laws for anyone predatorclass biiiiiiaaaatches.
Burn it all down. Reset. It's the only hope for the 99%.. .

Annie | October 13, 2014 at 8:32 pm

For Tony Foresta:

http://en.wikipedia.org/wiki/Milky_Way

At most, the estimate is that there are 400 billion stars in the Milky Way….

Any questions on why the price of oil is falling? LOL

Considering that the Federal Reserve Board (FRB) has never been audited, based on what they DID is all we can go on to ascertain whether they are a criminal cabal. So there is no other answer other than "Yes, they are" based on the 4 requirements for launching a "Just War" – since we are all here repeating ourselves, I am also – you all know where to find the "list"….right?

The FRB keeps lording it that they have ABSOLUTE control over "employment" in USA – so that clinches it that they DID conduct economic genocide when all those jobs disappeared as the Bush Cabal packed up their derivative piece on the way out of town…

@Jeb – you wrote, "But that administrative failure and its resulting Rolex-seeking bedfellows all pale in comparison to the deeper realty present having to do with the dual mandate of the Fed to regulate the banks while being in charge of the money system that those banks operate to maintain our economic output and stability."

You have to add their manipulation of "employment"….no?

Totalitarian Nihilism…"cosmic insanity" - still just low life scum bag THEFT of real $$ by trillions of Fiat $$$$s…a virtual cloud game for sadists and psychos….and they DO HAVE A LEADER, btw….The Urantia Book has leveled the playing field – info in the Book approved for ALL of humanity by none other than JC :-)

Page 759 – "….The Caligastia scheme for the immediate reconstruction of human society in accordance with his own ideas of individual freedom and group liberties, proved a swift and more or less complete failure. Society quickly sank back to its old biologic level, and the forward struggle began all over, starting not very far in advance of where it was at the Caligastia regime, this upheaval having left the world in confusion worse confounded."

That was 250, 000 years ago – looks like "social media" is not all that….

Sill never bending my knee to the GLOBAL War, Drug and Slave Lords stood up by the FRB's retarded shenanigans.

Math never was and never will be the paper that covers the rock that is SCIENCE…

400 BILLION stars from all that FIAT evergy :-)

Anonymouse | October 20, 2014 at 7:25 am

Frankly Annie, I have come to learn that over all, people are not KIND. Disbelief and denial follow, but do not sooth the mind. And that same non kindness includes family and friends in a tit for tat war that has no meaning or logical conclusion.

Sure we ask how it could have happened, but i'm certain if we got the chance somehow to do it all over again, this family would top the charts, the talent was undeniable, the timing was not.

[Nov 3, 2014] How Much Does It Cost To Keep JPMorgan FX-Riggers Out Of Jail?

Nov 3, 2014 | zerohedge.com

More than originally estimated, apparently...

Another day, another major bank adjust its reported data based on 'all-new' information about regulatory probes over its market manipulation. Last week was Citi, this week it's JPMorgan... with a double-whammy:

First, The SEC sanctioned 13 firms - including JPMorgan - for violating a rule primarily designed to protect retail investors in the municipal securities market in the sale of Puerto Rico bonds earlier this year...

All municipal bond offerings include a "minimum denomination" that establishes the smallest amount of the bonds that a dealer firm is allowed to sell an investor in a single transaction. Municipal issuers often set high minimum denomination amounts for so-called "junk bonds" that have a higher default risk that may make the investments inappropriate for retail investors. Because retail investors tend to purchase securities in smaller amounts, this minimum denomination standard helps ensure that dealer firms sell high-risk securities only to investors who are capable of making sizeable investments and more prepared to bear the higher risk.

In its surveillance of trading in the municipal bond market, the SEC Enforcement Division's Municipal Securities and Public Pensions Unit detected improper sales below a $100,000 minimum denomination set in a $3.5 billion offering of junk bonds by the Commonwealth of Puerto Rico earlier this year. The SEC's subsequent investigation identified a total of 66 occasions when dealer firms sold the Puerto Rico bonds to investors in amounts below $100,000. The agency instituted administrative proceedings against the firms behind those improper sales: Charles Schwab & Co., Hapoalim Securities USA, Interactive Brokers LLC, Investment Professionals Inc., J.P. Morgan Securities, Lebenthal & Co., National Securities Corporation, Oppenheimer & Co., Riedl First Securities Co. of Kansas, Stifel Nicolaus & Co., TD Ameritrade, UBS Financial Services, and Wedbush Securities.

The enforcement actions are the SEC's first under Municipal Securities Rulemaking Board (MSRB) Rule G-15(f), which establishes the minimum denomination requirement. Each firm agreed to settle the SEC's charges and pay penalties ranging from $54,000 to $130,000.

"These actions demonstrate our commitment to rigorous enforcement of all types of violations in the municipal bond market," said Andrew J. Ceresney, Director of the SEC's Division of Enforcement. "We will act quickly and use all available tools to protect investors in municipal securities."

LeeAnn G. Gaunt, Chief of the SEC's Municipal Securities and Public Pensions Unit added, "These firms violated a straightforward investor protection rule that prohibits the sale of muni bonds in increments below a specified minimum. We conduct frequent surveillance of trading in the municipal bond market and will penalize abuses that threaten retail investors."

The SEC's orders against the 13 dealers find that in addition to violating MSRB Rule G-15(f) by executing sales below the minimum denomination, they violated Section 15B(c)(1) of the Securities Exchange Act of 1934, which prohibits violations of any MSRB rule. Without admitting or denying the findings, each of the firms agreed to be censured. They also agreed to review their policies and procedures and make any changes that are necessary to ensure proper compliance with MSRB Rule G-15(f).

The SEC's investigation, which is continuing, is being conducted by Joseph Chimienti, Sue Curtin, Heidi M. Mitza, and Jonathon Wilcox with assistance from Kathleen B. Shields. The case is supervised by Kevin B. Currid and Mark R. Zehner. The SEC appreciates the assistance of the MSRB.

* * *
• Charles Schwab & Co. – $61,800
• Hapoalim Securities USA – $54,000
• Interactive Brokers LLC – $56,000
• Investment Professionals Inc. – $67,800
J.P. Morgan Securities – $54,000
• Lebenthal & Co. – $54,000
• National Securities Corporation – $60,000
• Oppenheimer & Co. – $61,200
• Riedl First Securities Co. of Kansas – $130,000
• Stifel Nicolaus & Co. – $60,000
• TD Ameritrade – $100,800
• UBS Financial Services – $56,400
• Wedbush Securities Inc. – $67,200

So that should teach them a lesson eh!!!

But then, second, JPMorgan was forced to admit to some more market manipulation was beinmg investigated:

From JPMorgan's 10-Q: Foreign Exchange Investigations and Litigation.

DOJ is conducting a criminal investigation, and various regulatory and civil enforcement authorities, including U.S. banking regulators, the Commodity Futures Trading Commission ("CFTC"), the U.K. Financial Conduct Authority (the "FCA") and other foreign government authorities, are conducting civil investigations, regarding the Firm's foreign exchange ("FX") trading business.

These investigations are focused on the Firm's spot FX trading activities as well as controls applicable to those activities. The Firm continues to cooperate with these investigations and is currently engaged in discussions with DOJ, and various regulatory and civil enforcement authorities, about resolving their respective investigations with respect to the Firm. There is no assurance that such discussions will result in settlements.

Since November 2013, a number of class actions have been filed in the United States District Court for the Southern District of New York against a number of foreign exchange dealers, including the Firm, for alleged violations of federal and state antitrust laws and unjust enrichment based on an alleged conspiracy to manipulate foreign exchange rates reported on the WM/Reuters service. In March 2014, plaintiffs filed a consolidated amended class action complaint, which defendants moved to dismiss in May 2014.

When the bank that has a fortress balance sheet has 7 pages of double sided tiny print Litigation in its 10-Q, something is wrong!!

* * *

So back to the question at the start of the post... how much does it cost to keep JPMorgan FX-riggers out of jail? The answer is - at least $24,341 per employee (243,388 employees and a $5.9 billion allocation)

[Oct 24, 2014] Henry Giroux On the Rise of Neoliberalism As a Political Ideology

A very important article. Should be read in full. Large quote below does not cover all the content of the article.
Oct 19, 2014 | truth-out.org

"There is a lack of critical assessment of the past. But you have to understand that the current ruling elite is actually the old ruling elite. So they are incapable of a self-critical approach to the past."

Ryszard Kapuscinski

Are they incapable, or merely unwilling? That is the credibility trap, the inability to address the key problems because the ruling elite must risk or even undermine their own undeserved power to do so.

I think this interview below highlights the false dichotomy between communism and free market capitalism that was created in the 1980's largely by Thatcher's and Reagan's handlers. The dichotomy was more properly between communist government and democracy, of the primacy of the individual over the primacy of the organization and the state as embodied in fascism and the real world implementations of communism in Russia and China.

But we never think of it that way any more, if at all. It is one of the greatest public relation coups in history. One form of organizational oppression by the Russian nomenklatura was replaced by the oppression by the oligarchs and their Corporations, in the name of freedom.

Free market capitalism, under the banner of the efficient markets hypothesis, has taken the place of democratic ideals as the primary good as embodied in the original framing of the Declaration of Independence and the US Constitution.

It is no accident that the individual and their concerns have become subordinated to the corporate welfare and the profits of the upper one percent. We even see this in religion with the 'gospel of prosperity.' In their delusion they make friends of the mammon of unrighteousness, so that after they may be received into their everlasting habitations.

The market as the highest good has stood on the shoulders of the 'greed is good' philosophy promulgated by the pied pipers of the me generation, and has turned the Western democracies on their heads, as a series of political leaders have capitulated to this false idol of money as the measure of all things, and all virtue.

Policy is now crafted to maximize profits as an end to itself without regard to the overall impact on freedom and the public good. It measures 'costs' in the most narrow and biased of terms, and allocated wealth based on the subversion of good sense to false economy theories.

Greed is a portion of the will to power. And that madness serves none but itself.

This is a brief excerpt. You may read the entire interview here.

Henry Giroux on the Rise of Neoliberalism
19 October 2014
By Michael Nevradakis, Truthout

"...We're talking about an ideology marked by the selling off of public goods to private interests; the attack on social provisions; the rise of the corporate state organized around privatization, free trade, and deregulation; the celebration of self interests over social needs; the celebration of profit-making as the essence of democracy coupled with the utterly reductionist notion that consumption is the only applicable form of citizenship.

But even more than that, it upholds the notion that the market serves as a model for structuring all social relations: not just the economy, but the governing of all of social life...

That's a key issue. I mean, this is a particular political and economic and social project that not only consolidates class power in the hands of the one percent, but operates off the assumption that economics can divorce itself from social costs, that it doesn't have to deal with matters of ethical and social responsibility, that these things get in the way.

And I think the consequences of these policies across the globe have caused massive suffering, misery, and the spread of a massive inequalities in wealth, power, and income. Moreover, increasingly, we are witnessing a number of people who are committing suicide because they have lost their pensions, jobs and dignity.

We see the attack on the welfare state; we see the privatization of public services, the dismantling of the connection between private issues and public problems, the selling off of state functions, deregulations, an unchecked emphasis on self-interest, the refusal to tax the rich, and really the redistribution of wealth from the middle and working classes to the ruling class, the elite class, what the Occupy movement called the one percent. It really has created a very bleak emotional and economic landscape for the 99 percent of the population throughout the world."

"This is a particular political and economic and social project that not only consolidates class power in the hands of the one percent, but operates off the assumption that economics can divorce itself from social costs, that it doesn't have to deal with matters of ethical and social responsibility."
I think that as a mode of governance, it is really quite dreadful because it tends to produce identities, subjects and ways of life driven by a kind of "survival of the fittest" ethic, grounded in the notion of the free, possessive individual and committed to the right of individual and ruling groups to accrue wealth removed from matters of ethics and social cost.

That's a key issue. I mean, this is a particular political and economic and social project that not only consolidates class power in the hands of the one percent, but operates off the assumption that economics can divorce itself from social costs, that it doesn't have to deal with matters of ethical and social responsibility, that these things get in the way. And I think the consequences of these policies across the globe have caused massive suffering, misery, and the spread of a massive inequalities in wealth, power, and income. Moreover, increasingly, we are witnessing a number of people who are committing suicide because they have lost their pensions, jobs and dignity. We see the attack on the welfare state; we see the privatization of public services, the dismantling of the connection between private issues and public problems, the selling off of state functions, deregulations, an unchecked emphasis on self-interest, the refusal to tax the rich, and really the redistribution of wealth from the middle and working classes to the ruling class, the elite class, what the Occupy movement called the one percent. It really has created a very bleak emotional and economic landscape for the 99 percent of the population throughout the world.

And having mentioned this impact on the social state and the 99%, would you go as far as to say that these ideologies have been the direct cause of the economic crisis the world is presently experiencing?

Oh, absolutely. I think when you look at the crisis in 2007, what are you looking at? You're looking at the merging of unchecked financial power and a pathological notion of greed that implemented banking policies and deregulated the financial world and allowed the financial elite, the one percent, to pursue a series of policies, particularly the selling of junk bonds and the illegality of what we call subprime mortgages to people who couldn't pay for them. This created a bubble and it exploded. This is directly related to the assumption that the market should drive all aspects of political, economic, and social life and that the ruling elite can exercise their ruthless power and financial tools in ways that defy accountability. And what we saw is that it failed, and it not only failed, but it caused an enormous amount of cruelty and hardship across the world. More importantly, it emerged from the crisis not only entirely unapologetic about what it did, but reinvented itself, particularly in the United States under the Rubin boys along with Larry Summers and others, by attempting to prevent any policies from being implemented that would have overturned this massively failed policy of deregulation.

It gets worse. In the aftermath of this sordid crisis produced by the banks and financial elite, we have also learned that the feudal politics of the rich was legitimated by the false notion that they were too big to fail, an irrational conceit that gave way to the notion that they were too big to jail, which is a more realistic measure of the criminogenic/zombie culture that nourishes casino capitalism.

[Oct 23, 2014] Rebuilding Trust in Finance We Can Do Better by Robert Johnson

Quote: "That's because of the persistent belief that the financial sector is functioning less like the nerve system of the economy and more like an autoimmune disease feeding on its host. This perception is not entirely unjustified."
Sep 17, 2013 | The Institute for New Economic Thinking
Trust is an essential part of a functioning economy, yet it is often one of the least understood variables in economics. That's why the Institute for New Economic Thinking is supporting the Thomson Reuters TRust index, which provides concrete metrics for understanding the level of trust in the financial system using a benchmark of the top 50 global financial institutions as a proxy for the sector as a whole.

While trust is difficult to understand and measure in the context of economics, this type of innovative work enables new and important conversations about trust and how it affects the economy. The Institute will be exploring this issue and the new economic thinking it facilitates In a series of essays over the next week. Stay tuned for more.

In the aftermath of the 2008 financial crisis, distrust in the financial sector was widespread. Even after the mess appeared to be cleaned up, the uncertainty over whether the worst was over remained real.

But since that time, financial institutions have shored up their balance sheets as their earnings and capital cushions have improved and leverage ratios have shrunk. In short, banks today are safer than they were before the crash. So surely trust should have returned as the likelihood of systemic collapse declined.

That, however, does not appear to be the case, as is demonstrated by the persistent negative levels of trust shown by the Thomson Reuters TRust index.

Many people in the financial sector feel this distrust. But they aren't sure what to do about it. How can they win back the public's trust? Aren't record profits enough?

Apparently, there are some things that money can't buy.

Trust is an essential part of a functioning economy. It provides an antidote to the fundamental uncertainty that is part of any economic decision. Without trust, you would likely spend all of your energy and resources protecting yourself rather than working on productive activities.

For the financial sector, trust is especially important. Finance is the nerve center of our economy, and trust is an essential component of the financial system. As we saw in 2008, without trust and a properly functioning financial system the economy breaks down. If people don't trust in financial institutions, the entire economic system can be thrown out of balance.

This lack of trust leads to many dysfunctional symptoms. When people don't trust where to put their savings, they hoard cash, or commodities like gold, which reached its highest price in history in the aftermath the 2008 crisis. Similarly, when trust in the financial sector is low, corporations also are more likely to hoard cash and less likely to invest in expansion or hire new employees, leading to stagnant economic growth and persistent unemployment.

Despite the financial sector's economic resurgence, we are still dealing with these economic problems today. The situation is a reflection of the distrust the public still feels for our financial institutions.

After 2008, when so many banks were rescued the public rightly felt that it was owed systemic reform so it wouldn't be put in the position of having to rescue the financial sector again. And while there has been an increase in regulation with Dodd-Frank, none of the changes have addressed the fundamental issues underpinning the lasting distrust in the financial system. I'm talking about major obstacles such as too big to fail, derivatives regulation, and the revolving door between regulators and those they are supposed to regulate. Eric Holder's comment before the United States Senate in March of this year that some banks are simply too big to effectively prosecute suggests that the system is still very far out of balance.

So while profits have returned, if the financial sector wants to regain the public's trust, it needs to offer something more than earnings reports.

That's because of the persistent belief that the financial sector is functioning less like the nerve system of the economy and more like an autoimmune disease feeding on its host. This perception is not entirely unjustified. Large multinational banks have been forced to pay billions of dollars in fines for misdeeds leading up to and during the crisis. And yet fundamental change remains illusive in the industry. As Holder's comments suggest, the ungovernability of some of the most powerful entities in our society is a big barrier to reestablishing trust in our financial system.

While some in the financial sector may profess dismay at this state of affairs, most of the leaders of behemoth banks have shown themselves more eager to coerce the process rather than agreeing to necessary reform.

For example, consider the way underwater mortgage holders were treated when the housing market collapsed. After already being bailed out by the public, the banks preached forbearance in mortgage markets because of their still-fragile balance sheets. Yet, at the same time these same banks still were offering their employees sizeable bonuses, even though the hole in the mortgage market could have been substantially reduced by the more than $100 billion these firms handed out over the last five years.

If our society had operated under a different set of priorities and required banks to put these funds into helping underwater borrowers instead of toward bonuses for many of the same people who helped sink the system in 2008, the hole in the mortgage market would no longer exist, there would be no need for forbearance, and our economy would be in much better shape. But that's not what happened.

As long as this Wall Street versus Main Street dynamic persists, so too will the belief that the financial sector plays by a different set of rules, rules tilted in their favor at the expense of the rest of us.

In order to regain the public's trust, the financial sector must show itself willing to take meaningful steps to address this concern. It must show the public that it is worthy of its trust by accepting meaningful reform for the good of our society. Until that happens, all of the profits and equity financing in the world won't win back the kind of trust that is essential for the financial sector to serve its role at the center of our economy.

This situation isn't "heads I win, tails you lose." In this scenario, we all lose. Persistent anger and mistrust cannot be good for anyone. We can do better.

[Oct 22, 2014] Corruption, neoliberals and their strange neoclassic economics

Oct 21, 2014 | seva-riga.livejournal.com
Neoliberal dogma is consistent only in rabid Russophobia. In all other respects they are, as in the joke: Q: How much will be 2 x 2 ? A: Well, what you want. We can make it from anywhere from 3 to 5...

Here's an example how it looks like a dispute with normal, sane blogger, who is writing under the nick - voronkov_kirill whose position is close to the positions staunch neoliberals:

- What is happening now with oil is called "short squeeze". And market mechanisms are not involved. Oil depreciates against the logic of the market, " says Cyril.

But wait a minute, I replied, there are two ways of pricing:

  1. Market price inherent in democratic countries with "free market"
  2. Administrative inherent in the totalitarian countries without the latter

Do I understand correctly that the countries that define the price of oil and the price of the ruble, are mostly totalitarian?

"No, not right. Well, absolute market, as well as absolute democracy does not exist. The market is "free" only for small players. Big players with serious financial or political-administrative levers, can influence "free market" and even control the price....

Here is everything you need to know about neoliberalism. And about so called "free market". Here Voltaire equality of free individuals. Here's to you and all the liberal government non-intervention in private Affairs. There is a "small players" and there are agents that can (I wonder by what right?) this element of control.

Unfortunately neoliberal thinking is not capable of a simple two-step, otherwise it inevitably would come to the conclusion that the absence of free competition in the economy will lead to the same state as in politics, where free competition of ideas and authorities only for small players, but not for TBTF -- like top government and industrial leaders. That is all about this now fashionable word "corruption"

In 1988 one stubborn Communist (then he is the same stubborn nationalist (Latvia-forever), and now no less staunch euro-emigrant ) promised to shoot me, because I argued that there were no socialism in the USSR and the economic system was not consistent with the fundamental principle of socialism is "from each according to his ability - to each according to his work"

Now here's the same thing with the market, with competition, with democracy. In reality like in case with the pregnancy market is iether free or not. If the corruption rules in the "real" market but illusions are force fed like in Guantanamo, sooner or later you will get full totalitarianism and with it total corruption. This is where slowly but inexorably the West moves, and with it anyone who tries to copy the Western model of the neoliberal economy. to this stable state called total corruption.

[Oct 06, 2014] Crony Capitalism Is Kryptonite To Democracy And The Real Economy

Zero Hedge

Submitted by Charles Hugh-Smith of OfTwoMinds blog,

When the machinery of governance is ruled by the highest bidders, democracy is dead.

Last week I described the sources of America's America's terminal political dysfunction. The engine of this terminal dysfunction is crony capitalism, the incestuous and oh-so-profitable marriage of the Central State and monied Elites.

Gordon T. Long and I continue our discussion of the perverse incentives and consequences of crony capitalism in a 25-minute video program.

Gordon argues that America's Crony Capitalism closely resembles the Roman Tribute System, an arrangement that skims wealth and concentrates it at the top of the power pyramid.

Vast financial crimes are met with fines. Guilty parties do not go to jail but rather the corporation pays a fine. Billion-dollar crimes are assessed million-dollar fines-- a percentage that closely mirrors a Tribute System. The government makes money through enforcement but not prevention. Corporations make illicit fortunes with the confidence that the government will settle for a small slice of the wealth stripmined from the people.

The fines for financial skimming operations act as a form of tribute to the Central State: the State and its corrupt elected officials and regulators turn a blind eye to the pillage of the citizenry via financialization schemes, and then skim a tribute via fines and campaign contributions.

Everybody in the inner circle wins: the finance perps collect their millions in bonuses, the legislators collect their millions in campaign contributions, and the regulators (who managed to do nothing in the way of prevention) get to declare a toothless victory in announcing wrist-slap fines.

I have covered this dynamic many times:

This cozy arrangement might seem benign, but it's actually deadly to democracy and the real economy. Let's call crony capitalism what it really is: Kryptonite to democracy and the real economy.

Concentrated wealth and State power form a self-reinforcing feedback loop that destroys democracy. The more profitable buying influence and the revolving door between corporations and regulators becomes, the more money the corporations have to spend on lobbying, which serves to further protect their profits. The more money political toadies collect, the more beholden they are to entrenched interests.

This feedback loop rewards crony capitalism and limits classical capitalism's key features: transparent markets and competition. An economy dominated by crony capitalism stagnates as competition is suppressed and government enriches those who are "more equal than others" (to borrow a phrase from Orwell).

Money that might have once been invested in research and development is now devoted to bribing politicos, lawsuits defending corporate turf and wrist-slap fines/Tribute to the State that enables and protects crony skimming operations.

When the machinery of governance is ruled by the highest bidders, democracy is dead.

Selected Skeptical Comments

Radical Marijuana

For sure, falcon, there is NO widely understood language to discuss what has been happening, as has been expressed by Cognitive Dissonance in these ways:

"Control the Language and You Control the Mind! ... It is the effective manipulation of our belief systems that enslaves us to the present day insanity. ... The absolute best controlled opposition is one that doesn't know they are controlled."

The American democratic republic was destroyed as the international bankers took control over the public "money" supply, and turned that inside-out and upside-down, so that the word "money" now means pretty well the opposite of what it used to mean! The American money supply was supposed to be backed by gold and silver, who value was set by Congress. Indeed, the word "dollar" originally meant a particular amount of silver.

However, the banksters were able to systematically apply the methods of organized crime, through bribery, intimidation, and assassination, in order to result in enough of the politicians becoming the banksters' puppets, while enough the people could be fooled enough of the time, in order to keep on replacing their representatives with one fresh crop of professional liars and immaculate hypocrites after another.

As usual on Zero Hedge, this article grossly underestimates and understates how serious the problems actually are!

Jack Burton

It is beyond doubt that citizen democracy is dead in America. The Main Stream media investigates nothing of importance and if something unfavorable to corporate interests emerges from other sources, the Main Stream Media ignores it completely. A congress and President that accept money bribes in public, as part of the political process, with Supreme Court approval, is a sign of their arrogance. I just read a long study of Fracking Industry and US Foreign Policy. You literally have corporations and the State Department as virtual departments within each other, not separate entities. Where Frackers seek to go, American tax payer money, the CIA, State Department and US Military lead the way. There is no revolving door, because corporate and government operate together with all actions "in house" as it were.

Obama health care law, this was written by Insurance Company lobbyists and present to congress by corporate health insurance companies to be passed in the interests of profits and nothing more.

The government and corporate contractors are one single entity when it comes to arms, war, spy agencies and the police state. Even people in America's gulag are often held by for profit guards who seek to make maximum profit by dealing with humans at the lowest level possible.

One could go on, Universities are money machines for their owners and top executives, not to mention sports interests and television.

[Sep 27, 2014] How Goldman Controls The New York Fed: 47.5 Hours Of "The Secret Goldman Sachs Tapes" Explain

Sep 26, 2014 | http://www.zerohedge.com

I don't want to spoil the revelations of "This American Life": It's far better to hear the actual sounds on the radio, as so much of the meaning of the piece is in the tones of the voices -- and, especially, in the breathtaking wussiness of the people at the Fed charged with regulating Goldman Sachs. But once you have listened to it -- as when you were faced with the newly unignorable truth of what actually happened to that NFL running back's fiancee in that elevator -- consider the following:

  1. You sort of knew that the regulators were more or less controlled by the banks. Now you know.
  2. The only reason you know is that one woman, Carmen Segarra, has been brave enough to fight the system. She has paid a great price to inform us all of the obvious. She has lost her job, undermined her career, and will no doubt also endure a lifetime of lawsuits and slander.

So what are you going to do about it? At this moment the Fed is probably telling itself that, like the financial crisis, this, too, will blow over. It shouldn't.

[Sep 26, 2014] | Why the Fed Is So Wimpy'

Sep 26, 2014 | Economist's View

Justin Fox:

Why the Fed Is So Wimpy, by Justin Fox: Regulatory capture - when regulators come to act mainly in the interest of the industries they regulate - is a phenomenon that economists, political scientists, and legal scholars have been writing about for decades. Bank regulators in particular have been depicted as captives for years, and have even taken to describing themselves as such.
Actually witnessing capture in the wild is different, though, and the new This American Life episode with secret recordings of bank examiners at the Federal Reserve Bank of New York going about their jobs is going to focus a lot more attention on the phenomenon. It's really well done, and you should listen to it, read the transcript, and/or read the story by ProPublica reporter Jake Bernstein.
Still, there is some context that's inevitably missing, and as a former banking-regulation reporter for the American Banker, I feel called to fill some of it in. Much of it has to do with the structure of bank regulation in the U.S., which actually seems designed to encourage capture. But to start, there are a couple of revelations about Goldman Sachs in the story that are treated as smoking guns. One seems to have fired a blank, while the other may be even more explosive than it's made out to be. ...

don:

Probably the biggest lesson that will be taken from this is Carmen's fate - she was fired, so don't cross Goldman.

anne -> don...

http://dealbook.nytimes.com/2014/09/25/wall-street-still-needs-a-leader-on-reform/

September 25, 2014

Wall Street Still Needs a Leader on Reform
By William D. Cohan

This is also the same New York Fed that fired Carmen M. Segarra, a former bank examiner, after she questioned Goldman's conflicts in connection with its role in advising a client, the El Paso Corporation, on its merger with Kinder Morgan Inc., in which Goldman's private-equity fund had a large investment. When Ms. Segarra asked Goldman for its conflict-of-interest policy, she discovered that it did not have one. She raised her concerns with her superiors at the New York Fed but, she contended, her bosses asked her to alter her written views on the matter because they could cause Goldman "substantial financial harm," according to an article in The New York Times. * Ms. Segarra was eventually fired. She sued the New York Fed, accusing it of retaliation; a federal judge ruled against her in April....

* http://dealbook.nytimes.com/2013/10/10/bank-examiner-was-told-to-back-off-goldman-suit-says/

anne -> don:

http://dealbook.nytimes.com/2013/10/10/bank-examiner-was-told-to-back-off-goldman-suit-says/

October 10, 2013

Suit Revives Goldman Conflict Issue By Susanne Craig and Jessica Silver-Greenberg

At a March 2012 meeting, a group of examiners at the Federal Reserve Bank of New York agreed that Goldman Sachs had inadequate procedures to guard against conflicts of interest - guidelines aimed at stopping firms from putting their pursuit of profit ahead of their clients' best interests.

The examiners voted to downgrade a confidential rating assigned by the New York Fed that could have spurred costly enforcement actions and other regulatory penalties. It is not known whether the vote in fact led to a rating change. The former examiner who pushed for a downgrade, Carmen M. Segarra, now contends in a lawsuit filed on Thursday that just weeks after the vote, her superiors asked her to change her findings on Goldman and fired her after she refused.

The vote to downgrade, which has not been previously reported, could have been a big blow for Goldman.

"Goldman Sachs does not have a conflicts-of-interest policy, not firmwide, and not for any divisions," Ms. Segarra wrote to Michael F. Silva, a senior executive at the New York Fed. "I would go so far as to say they have never had a policy on conflicts."

The lawsuit, along with a review by The New York Times of confidential government documents and internal e-mails, raises questions about the success of Goldman's efforts to police potential conflicts.

The bank has been buffeted by accusations that it has put its own interests ahead of its clients, a contention it denies. Goldman, for instance, faced accusations that in the run-up to the financial crisis that it sold billions of dollars in souring real estate assets to unsuspecting clients. Just weeks before the examiners' vote last year, the bank was publicly excoriated by a federal judge who found that Goldman had conflicts in a huge energy deal.

The lawsuit also provides a look into the often-opaque relationship between federal regulators and Wall Street. After the financial crisis, banking regulators faced criticism that they were too cozy with the banks that they were overseeing - a familiarity that failed to thwart some of the risky behavior precipitating the housing crisis and ensuing recession.

Even now, banks have sway over their regulators, especially those stationed at a bank's headquarters, according to two former regulators who spoke on the condition of anonymity. The banks, for example, can work behind the scenes to avert a vote like the one to downgrade Goldman. The people said, however, that once a vote to downgrade has taken place, it is difficult to reverse.

In the lawsuit, which was filed in Federal District Court in Manhattan, Ms. Segarra contends she was wrongfully terminated in violation of a federal law that affords protections to bank examiners who find wrongdoing in the course of doing their jobs. Mr. Silva, who is chief of staff for the executive group at the New York Fed, is among the defendants named in the suit....

Richard :

While they may be the worst offenders I doubt that the problem ends with Goldman. I have heard too many horror stories from people who worked as regulators in the government over the last thirty years to believe that this is an isolated case.

So long as we have a money driven political process it will be very difficult to avoid regulatory capture.

Increasingly th U.S. resembles a Latin American country where bankers are at war with democracy itself.

bakho:

In the RollingStone, Taiibi described GS as the Great Vampire Squid:

"The first thing you need to know about Goldman Sachs is that it's everywhere. The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money. In fact, the history of the recent financial crisis, which doubles as a history of the rapid decline and fall of the suddenly swindled dry American empire, reads like a Who's Who of Goldman Sachs graduates."

GS makes money by manipulating the system in a quasi-legal, morally corrupt manner. They challenge all the rules and use the Revolving Door between regulator and regulated to deliver legal bribes. Society needs better regulators and regulations to protect themselves from parasites like the GS Vampire Squid.

GS is one of the chief proponents of "Free Market" ideology.

Free Market" is short for "Free to rip off the "Market" . The words "to rip off" are omitted when they sell the "Free Market" ideology and are reserved for the back rooms and jokes in private email. The rubes are too dim to get it or else think they are the scammers and not the scammed.

EE -> bakho...

"GS makes money by manipulating the system in a quasi-legal, morally corrupt manner. They challenge all the rules and use the Revolving Door between regulator and regulated to deliver legal bribes."

Well said, but its not just GS. Your description applies to much of corporate America. We're living in a crony capitalist society.

EE said...

"Much of it has to do with the structure of bank regulation in the U.S., which actually seems designed to encourage capture." Which is a feature and not a bug.

[Sep 26, 2014] The Biggest Lie of the New Century

Sep 07, 2014 | Bloomberg View

Yesterday, we looked at why bankers weren't busted for crimes committed during the financial crisis. Political corruption, prosecutorial malfeasance, rewritten legislation and cowardice on the part of government officials were among the many reasons.

But I saved the biggest reason so many financial felons escaped justice for today: They dumped the cost of their criminal activities on you, the shareholder (never mind the taxpayer).

Corporate executives theoretically work for the owners of the company, namely, the shareholders. But there is an agency problem in that owners can't closely manage and object to the actions of these executives. Collective owners, such as mutual funds, seem to have no interest in doing so. What we end up with is a management class that works for itself instead of on behalf of the owners of the publicly traded banks. Many of these executives committed crimes; got big bonuses for doing so; and paid huge fines using shareholder assets (i.e., company cash), helping them avoid prosecution.

As for claims like those of white-collar crime defense attorney Mark F. Pomerantz, that "the executives running companies like Bank of America, Citigroup and JP Morgan were not committing criminal acts," they simply are implausible if not laughable. Consider a brief survey of some of the more egregious acts of wrongdoing:

Foreclosure fraud: Of all the crimes committed during the financial crisis and in its aftermath, this is one that should have been the easiest to identify and prosecute.

Any bank that owns a mortgage with the debtor in default must follow a simple set of legal steps in order to foreclose. The procedure is time consuming, specific to each state's laws and involves lawyers, so foreclosures are expensive. Hey, it is the cost of issuing credit, and a simple reality of the rule of law. There are no shortcuts.

Except the banks took many short cuts and did so on purpose and with the goal of improperly expediting the process. They failed to review the documents of the mortgages they were foreclosing on, then told courts they had. They didn't verify information, but claimed to have done so in sworn affidavits. They hired $8 an hour burger-flippers to "robosign" these documents, pretending the underlying legal work had been done. They knowingly used falsified records, some of which they bought en masse. They were aided by a company called DocX, which had a price list of fabricated documents for use in court. (DocX, by the way, was eventually indicted on charges of mortgage fraud).

After creating phony dossiers on borrowers, the banks signed and notarized affidavits stating they had taken all of the legal steps. In many cases, even the notarizations were fakes. Submitting a falsified notarized affidavit to a court is perjury and fraud.

Of course, the burger-flippers who did the paperwork didn't think up the whole scheme -- someone much higher did. Somewhere between these low-level workers and the chief executive officer were managers who masterminded robosigning. So far, just one midlevel executive has been convicted at Bank of America, while scores of others have gone untouched.

Mortgage underwriting: Then there are the crimes committed in mortgage underwriting, where defects were knowingly ignored. The FBI investigated these cases early on, but investigators never moved forward with prosecutions.

Maybe the scale of the financial penalties bank agreed to pay had something to do with this inaction. Bank of America, for instance, using shareholder money, paid $16.65 billion to settle allegations of fraudulent mortgage originations, securitizations and servicing. One can't help think that this money bought immunity from prosecution for executives.

Money Laundering: Banks have been laundering staggering sums of money for drug dealers and terrorists. Hey, there are big bucks in high net worth narco-terrorists. Awash in cash, drug cartels relied on big banks to launder their ill-gotten money. Apparently, it was just good business to grab a slice of that pie. However, these are deeply offensive, very illegal activities, and deserve not just penalties, but jail time.

How much of this dirty money made its way through the banks? One analysis estimates that $1.6 trillion of tainted proceeds has been laundered through major money-center banks around the world.

A U.S. Senate report linked HSBC to drug lords and terrorists, leading to a record $1.9 billion fine. The Federal Reserve faulted Citigroup over its controls, allowing money laundering to go on. And Wells Fargo admitted to laundering money for Mexican drug gangs.

So next time you hear the claim that "there were no crimes committed by bankers," just remember that this may be the biggest lie of the 21st century.

To contact the author of this article: Barry Ritholtz at [email protected]. To contact the editor responsible for this article: James Greiff at [email protected].

[Sep 26, 2014] The New Classical Clique

Economist's View

Paul Krugman continues the conversation on New Classical economics::

The New Classical Clique: Simon Wren-Lewis thinks some more about macroeconomics gone astray; Robert J. Waldmann weighs in. For those new to this conversation, the question is why starting in the 1970s much of academic macroeconomics was taken over by a school of thought that began by denying any useful role for policies to raise demand in a slump, and eventually coalesced around denial that the demand side of the economy has any role in causing slumps.
I was a grad student and then an assistant professor as this was happening, albeit doing international economics – and international macro went in a different direction, for reasons I'll get to in a bit. So I have some sense of what was really going on. And while both Wren-Lewis and Waldmann hit on most of the main points, neither I think gets at the important role of personal self-interest. New classical macro was and still is many things – an ideological bludgeon against liberals, a showcase for fancy math, a haven for people who want some kind of intellectual purity in a messy world. But it's also a self-promoting clique. ...
MaxSpeak:

Regarding Waldmann's remark about the ideological proclivities of, among others, Martin Feldstein, at the recent NBER meetings in D.C. he presented a paper on reducing tax expenditures to lower the deficit, wherein no tax expenditure favoring saving or investment fell to his axe. When someone in the audience mentioned that tax expenditures for saving probably reduced saving more than increased it (since the cost to the Gov exceeds the marginal effect on saving), he professed ignorance of whether or not that is true. (It is.)

bakho said...

In the 70s models were started in a lot of fields in addition to economics including biology, environmental science, ecology. In part it looks to have been physics envy. But the physicists made models of systems that were far more simple than economics. Modelers in the 70s went to work using computers that filled whole rooms but had less computing power than my laptop. By necessity they had to make assumptions that made the models crude predictors. But computing power was increasing and the optimists believed that eventually it would be possible to model such complex systems as economics using micro foundations, a lifetimes work.............. Not. Micro founded models make about as much sense as building a weather model based on individual atoms. Computers still are not there yet and may never be. The modelers of the 70s were overoptimistic about what they could deliver and buffaloed many people into thinking they were hot stuff. It was an exclusive club with higher math skills required as a ticket to admission. It is most difficult to cut losses on sunk costs, but that is their legacy.

Rather than detailed models that provide insights to the minutiae of economies, models have many short cuts and assumptions that assume as givens what might be important insights. They assumed the economy of the time: Full employment and supply limited. The models of the 70s fell apart with the 80s recession but regained their footing after the recovery and great moderation when the economy was in a sweet spot that required little action for the Fed. Thus the models had several decades to coast along without major fail. We hit an economy that was demand limited and high unemployment. The things many models simply assumed away were the very problems that needed addressing.

The 70s models belong on the dust heap of history in the company of many failed models in other disciplines that have long since been abandoned. As the Nobel Laureate Max Planck noted, "Science advances one funeral at a time."

bakho -> bakho...

SWL wonders why Keynes was dismissed in the 70s.

Very wealthy special interests disliked Keynes, disliked the New Deal and spent some of their money to support academics and intellectuals that could dismiss Keynes or show that his policies were in error. They funded people to work on the project of undermining Keynes and still do. Wealthy elites were eager to support economists to work on economics projects that denounced Keynes. Researchers of all striped try to keep their patrons happy. If refutation of Keynes was the price demanded in order to build up a computer based economics from micro foundations so be it. Keynes wasn't needed for micro foundations. Keynes was an impediment to funding. It is not surprising that Keynes was jettisoned. When micro foundations sputtered, there was too much crow to be eaten. Better to double down than die of embarrassment.

[Sep 11, 2014] 'Think Tank-Gate' Corruption Is the Price of Empire by Justin Raimondo

Quote: "Corruption – there is no other word for the buying of America's thinktanks by rich foreigners – is part of the price we pay for our empire."
September 8, 2014 | The Ron Paul Institute for Peace and Prosperity

A New York Times investigation into the influence of foreign money on American thinktanks is causing a Twitter-storm as I write this, and with good reason. In one particularly egregious example, the report details an explicit agreement, signed by the principals, between the Center for Global Development (CGD) and the government of Norway for the former to propagandize on behalf of doubling a foreign aid program to Norway in exchange for a $5 million donation. Aside from the brazen corruption of the CGD/Norway relationship, the report focuses on three other Washington DC biggies: the Atlantic Council, the Brookings Institution, and the Center for Strategic and International Studies, all of which receive substantial chunks of cash from rich overseas donors, primarily from the Middle East, Europe, and the Far East. For example, the Times notes:

"The United Arab Emirates, a major supporter of the Center for Strategic and International Studies, quietly provided a donation of more than $1 million to help build the center's gleaming new glass and steel headquarters not far from the White House. Qatar, the small but wealthy Middle East nation, agreed last year to make a $14.8 million, four-year donation to Brookings, which has helped fund a Brookings affiliate in Qatar and a project on United States relations with the Islamic world."

CSIS was a major supporter of the Iraq war (both of them), as were the Gulf sheikdoms that have been funneling money into it: CSIS has also been a major bulwark of the War Party when it comes to Iran.

Brookings, the grand old man of Washington thinktanks, denies all that cash has any meaning as far as its "product" is concerned, but it's hard to take this seriously when it publishes papers like this and sponsors events like this one, where Qatar's funding of jihadist groups like ISIS and other radical Syrian rebel factions is downplayed in favor of putting the onus on Kuwait. Qatar has been a major backer of the decidedly non-"moderate" wing of the Syrian rebel movement, and while Brookings has published writers skeptical of the idea of arming and/or funding them, a bit of research shows that their overwhelming bias has been pro-rebel, e.g. "Arm the Syrian Rebels. Now."

Brookings has also been a major source of pro-Israel propaganda in the United States via their Saban Center for Middle East Policy. Funded by Haim Saban, an Israeli-American television and film producer – originator of the "Mighty Morphin Power Rangers" – whose wealth is estimated at $3 billion, the Saban Center has consistently supported the Israeli party line and acted as a "nonpartisan" complement to AIPAC's Washington Institute for Near East Policy. Quite naturally, the Saban Center'sKenneth Pollack was a major supporter of the Iraq war amongst the policy wonk crowd.

Dual Israeli-American citizen Saban makes no bones about the goal of his giving: he has said that his number one priority in giving money to thinktanks like Brookings is to "strengthen the US-Israeli relationship." As a New Yorker profile of Saban put it, he counts "three ways to be influential in American politics": "make donations to political parties, establish think tanks, and control media outlets." Saban owns Univision and has repeatedly tried to buy the Los Angeles Times. He is also one of the top donors to the Democratic party, and will no doubt be a major contributor to Hillary Clinton's presidential campaign.

At a recent Brookings Institution dinner, Saban engaged in a "two-cheeked kiss" with Qatari Prime Minister Jaber Al Thani. What unites these two somewhat disparate figures is their fulsome financial support for Brookings, which – like any whore – sells its services to the highest bidder.

While Brookings, one of Washington's most established courtesans, charges higher prices, and thus relies on high-rollers like Qatar and Saban, the relatively new Atlantic Council takes the quantitative approach: the Times reports the Council has accepted donations from at least 25 countries since 2008." Among the donors: Estonia, Latvia, Lithuania, Macedonia, Hungary, the Czechs, the Slovaks, Sweden, Luxembourg, and the United Kingdom. This donor list isn't surprising: the Atlantic Council, as befits its name, is NATO's unofficial lobbyist in Washington. It has been particularly militant around the Ukraine issue, pushing the NATO-crat party line that the fascist coup leaders in Kiev are really Jeffersonian democrats and stoking the embers of the cold war.

CSIS, long a mainstay of interventionist policymaking, actually posted a list of the governments that have filled its coffers, including Saudi Arabia, United Arab Emirates, the United Kingdom, NATO – and the United States of America! Yes, your tax dollars are going to fund the efforts of CSIS co-director and senior fellow Thomas Sanderson and CSIS "Transnational Threats" head honcho Arnaud de Borchgrave in their efforts to torpedo a possible peace agreement with Iran. We don't know how much Uncle Sam doles out to CSIS because they refuse to divulge specific amounts – and of course we peons have no right to know.

The extent of the problem of foreign governments buying up American thinktanks like house flippers buy up foreclosures is bigger than even I imagined. As the Times puts it:

"The scope of foreign financing for American think tanks is difficult to determine. But since 2011, at least 64 foreign governments, state-controlled entities or government officials have contributed to a group of 28 major United States-based research organizations, according to disclosures by the institutions and government documents. What little information the organizations volunteer about their donors, along with public records and lobbying reports filed with American officials by foreign representatives, indicates a minimum of $92 million in contributions or commitments from overseas government interests over the last four years. The total is certainly more."

As Todd Moss, COO of CGD, said "after being shown dozens of pages of emails between his organization and the government of Norway": "Yikes"!

The Foreign Agents Registration Act (FARA), which requires foreign lobbyists to register and report their activities to the federal government, has never been enforced except selectively: US allies are given a free pass, and the "foreign aid" gravy train flows freely and fast. This makes perfect sense, given our status as a global empire on which the sun never sets: our foreign clients and protectorates are constantly begging for handouts, intervention against their enemies, and special economic privileges of one sort or another, and the government would no more shut down this profitable industry than it would voluntarily dismantle the Empire itself.

NATO's eastern European members want US troops and bases on their soil, ostensibly to "protect" against the nonexistent threat of a Russian invasion – and it's only natural for them to go running to the Atlantic Council to lobby on their behalf. Qatar wants US aid to Syria's jihadist rebels – and off they go to their bought-and-paid-for "scholars" at Brookings to write policy papers and sponsor events pushing US intervention in the Syrian snake-pit.

Corruption – there is no other word for the buying of America's thinktanks by rich foreigners – is part of the price we pay for our empire. It won't stop until we return to our roots as a republic that "seeks honest friendship with all nations – entangling alliances with none."

[Sep 3, 2014] The US Is In a Societal Panic: Why Our Tax and Economic Debates Are Irrational

Sep 3, 2014 | jessescrossroadscafe.blogspot.com

David Cay Johnston is an excellent lecturer, who can address economics and public policy in clear and simple statements.

This is one of most informative talks I have heard about where we are, and how we got here, what the crony kleptocracy is, and how it works.

Johnston's concept of a societal panic corresponds to the notion of national hysteria which I have expressed on a number of occasions. But he fills out the idea more fluently and fully. It is a dangerous period of time which can yield new ideas and concepts, depending on how well we survive it.

It is a must watch, and I rarely say that.

http://www.youtube.com/embed/6Tk558ocjME

[Jan 18, 2014] Neoliberalism and Corruption by Wyz

May 19, 2011 | phdoctopus.com

The core assumption of our neoliberal moment, of course, is that markets are the best ways to distribute goods and organize society. Right-neoliberals end there, and declare war on all public goods and any attempt whatsoever to regulate that market. Left-neoliberals maintain that individuals should have access to some basic social welfare, but always reject the idea that the state should be in charge of distributing it. Thus you end up with bizarre, hideously complicated, and inefficient systems like Obama's health care plan. Since it is almost literally unthinkable that the state could provide a good better than the Market could (every time you say the word Market, by the way, an angel should be playing flutes inside your brain), left-neoliberals have to invent complicated ways to bribe, coerce, and manage the Market God into sort-of-kind-of-not-really providing the resource that left-neoliberals admit is essential.

This critique of neoliberalism is well known. Two recent stories, though, have reminded me just how much this brand of brain-dead market worship isn't just inefficient and wasteful, but contributes directly to corruption and the erosion of our democracy. First, this one from Albany. Charter schools are, of course, neoliberalism's wet dreams– you get abundant public money, little oversight, and, best of all, get to hide behind cute disadvantaged kids, all while doing Goldman Sachs' bidding. Problem is, of course, they don't actually perform any better than most public schools, so given a choice parents might not send their children to charter schools. The first solution, of course, is to spend money on advertising, a horrible waste of public money, which doesn't in any way contribute to a better educational experience. The second option we see in Albany, where Charter Schools are spending their money, which comes, remember, from the taxpayers, to advertise against the local school budget. Why? Well, the budget didn't affect them at all, but it would increase support for the city's public schools. So they used public money, in order to try to lower the funding for their competitors, who happen to be public schools. Cute, huh? Public money in order to hollow out public institutions.

Next, we have the prison industry, where the New York Times reports that private prisons are no cheaper, and often more expensive, then public government run prison. If Dostoevsky famously said that the conditions of prisons demonstrates the level of your civilization, then the fact that we have turned our prisons over to faceless, unaccountable corporations seems appropriate. But even more appropriate to our time, is that the prison industry often uses their money, which comes from the public, to advocate for brutal racist immigration policies that are guaranteed to produce more prisoners. Specifically, they were behind the push for Arizona's notorious SB 1070 law, cracking down on undocumented immigrants.

Connecting both stories, obviously, is that fact that the market is not some neutral "tool" that can be manipulated to serve the ends of the state. By turning public goods over to private entities, we empower people who have a particular interest in public policy. The (attempted) underfunding of Albany schools and the racist immigration laws of Arizona, then, are partly the product of seemingly separate political decisions about how to provide certain services.

[Jan 18, 2014] Neoliberalism and Corruption

Aug 19, 2008 | staff.blog.ui.ac.id

In 1997, the World Bank asserted that: any reform that increases the competitiveness of the economy will reduce incentives for corrupt behavior. Thus policies that lower controls on foreign trade, remove entry barriers to private industry, and privatize state firms in a way that ensure competition will all support the fight.

The Bank has so far shown no signs of taking back this view. It continues to claim that corruption can be battled through deregulation of the economy; public sector reform in areas such as customs, tax administration and civil service; strengthening of anti-corruption and audit bodies; and decentralization.
Yet the empirical evidence, much of it from the World Bank itself, suggests that, far from reducing corruption, such policies, and the manner in which they have been implemented, have in some circumstances increased it. - Dr Susan Hawley, Exporting Corruption; Privatization, Multinationals and Bribery, The Corner House, June 2000 Jubilee Research (formerly the prominent Jubilee 2000 debt relief campaign organization) has similar criticisms, and is also worth quoting at length:

Rich country politicians and bank officials argue that because dictators like Marcos, Suharto, and Mobutu were kept in power with western arms and were given loans to squander on ill-judged and repressive schemes, that the people of those countries-who often fought valiantly against those dictators-cannot be trusted not to waste the money released by debt cancellation. This may seem confusing to people not familiar with the logic of the IMF and World Bank.

In summary:

To many people in the South, this seems irrational and illogical-the logic of blaming the victim. It is the logic of power rather than of integrity, and is used to benefit the rich rather than the poor in developing countries.

A similar logic argues that if the World Bank and government export credit agencies promoted inappropriate and unprofitable projects, then southern governments proved their inability to control money because they accepted the ill-advised projects in the first place. Thus, if money is released by debt cancellation, it must be controlled by agencies which promoted those failed projects.

This is the logic that says if people were stupid enough to believe cigarette advertising, then they are too stupid to take care of themselves and the "reformed" cigarette companies should be put in charge of their health care.

The same institutions who made the corrupt loans to Zaire and lent for projects in Africa that failed repeatedly are still in charge, but their role has been enhanced because of their success in pushing loans. Can we trust these institutions to suddenly only lend wisely; to not give loans when the money might be wasted?

Preventing new wasted loans and new debt crises, and ensuring that there is not another debt crisis, means that the people who pushed the loans and caused this crisis cannot be left in charge.
The creditors or loan pushers cannot be left in charge, no matter how heartfelt their protestations that they have changed. Pushers and addicts need to work together, to bring to an end the entire reckless and corrupt lending and borrowing habit. - Joseph Hanlon and Ann Pettifor, Kicking the Habit; Finding a lasting solution to addictive lending and borrowing-and its corrupting side-effects, Jubilee Research, March 2000

And in terms of how lack of transparency by the international institutions contributes to so much corruption structured into the system, Hanlon and Pettifor continue in the same report as cited above:
Structural adjustment programs cover most of a country's economic governance.
… The most striking aspect of IMF/World Bank conditionality [for aid, debt relief, etc] is that the civil servants of these institutions, the staff members, have virtual dictatorial powers to impose their whims on recipient countries. This comes about because poor countries must have IMF and World Bank programs, but staff can decline to submit programs to the boards of those institutions until the poor country accepts conditions demanded by IMF civil servants.
There is much talk of transparency and participation, but the crunch comes in final negotiations between ministers and World Bank and IMF civil servants The country manager can say to the Prime Minister, "unless you accept condition X, I will not submit this program to the board". No agreed program means a sudden halt to essential aid and no debt relief, so few ministers are prepared to hold out. Instead Prime Ministers and presidents bow to the diktat of foreign civil servants. Joseph Stiglitz also notes that "reforms often bring advantages to some groups while disadvantaging others," and one of the problems with policies agreed in secret is that a governing elite may accept an imposed policy which does not harm the elite but harms others. An example is the elimination of food subsidies.
- Joseph Hanlon and Ann Pettifor, Kicking the Habit; Finding a lasting solution to addictive lending and borrowing-and its corrupting side-effects, Jubilee Research, March 2000

As further detailed by Hanlon and Pettifor, Christian Aid partners (a coalition of development organizations), argued that top-down "conditionality has undermined democracy by making elected governments accountable to Washington-based institutions instead of to their own people." The potential for unaccountability and corruption therefore increases as well.
http://www.thestreetspirit.org/June2006/bank.htm

World Bank battles corruption - but only in some countries.

Observing the struggles of its sister organization (the IMF), the World Bank has taken a proactive approach to its own crisis of legitimacy by considering extending invitations to Mexico, Turkey, South Korea and China to become full voting members. The World Bank is also investing $30 million in a public relations campaign in an effort to position itself as the premiere lending institution for global efforts to end poverty, protect the environment and address the global AIDS pandemic, as well as to reiterate that it is the world's largest "development" research organization.

At the heart of this new media campaign is World Bank President Paul Wolfowitz's new anti-corruption campaign. Given Wolfowitz's recent history as the architect of the Iraq war and occupation - an undertaking literally drowning under allegations of mismanagement and nepotism - many see this anti-corruption campaign as grossly hypocritical.

Many African leaders have long said that they need Western institutions to aid them in rooting out corruption and ensure transparent governance, since international institutions based in the Global North are complicit in corruption. Recently, European countries have pressured Wolfowitz to put greater emphasis on building institutions to fight corruption in the developing world, rather than simply suspending loans where corruption is suspected. As a result, he began working with shareholders to develop a framework to fight and monitor corruption. The framework will be considered at the next IMF/WB meetings in the Fall of 2006 in Singapore. While welcoming this needed reform, many argue that the World Bank is not applying the same scrutiny to Iraq and Indonesia (where Wolfowitz worked prior to his work in the Bush administration) that is being applied to Chad and the Democratic Republic of Congo.

In January, the World Bank cut off $124 million in loans after Chad changed its laws to siphon oil pipeline revenues away from anti-poverty programs; and in March, the Bank imposed rigid conditions on Congo's oil-exporting capacity. The World Bank maintains that Chad, Congo and Sudan may all be eligible for debt relief in the coming months, provided they show proof of economic stability and government reform. Civil society reactions Addressing corruption and the need for basic standards applied to loans and disbursements has been one of the main campaign points of civil society in the Global South for the last 30 years. Campaigners are pleased to see the financial institutions that are the source of so much corruption taking this life-threatening issue seriously. However, ensuring that debt-servicing funds are properly reallocated to address human needs (education, health, etc.) is a process that must involve partnerships between civil society and governments in indebted countries. This process cannot be achieved solely vis-a-vis international institutions. At present, there are seven international bodies that address accountability and transparency in international fund management. If the World Bank wants to add itself to this list, there must first be a proper analysis of why these existing institutions and bodies have not been wholly effective.

[Jan 18, 2014] Thatcher and corporatist corruption

April 16, 2013 | theodoredalrymple.wordpress.com

Margaret Thatcher's belief, writes Dalrymple, that the idea of public service

was…a mask for private rent-seeking, which could be avoided only by the introduction of the management techniques of the…private sector, paved the way for the…corporatist corruption of…Blair…and Brown….

She helped create a…large class of apparatchiks posing as businessmen, who…learned how to loot the public purse….

Blair and Brown…expanded the public sector to secure votes…and increased…dependency on the state….

They did so by…borrowing.

[Jan 18, 2014] The Corporatist Culture of Corruption

A very interesting use of the concept of corruption as a tool to blackmail "resource nationalists" and enforce neoliberal regime in countries like Russia.
Jan 29, 2011 | realclearmarkets.com

Transparency International, a non-governmental anti-corruption organization in Berlin, classifies Russia as one of the most corrupt nations in the world. The organization defines corruption explicitly: "The abuse of entrusted power for private gain." Transparency International's 2010 Corruption Perception Index, an assessment administrated by independent institutions on corruption in the public sector, ranked Russia 154th out of 178 nations, below Iran, Kenya, Cambodia, and Pakistan. The CPI measures corruption in the following way:

The surveys and assessments used to compile the index include questions relating to bribery of public officials, kickbacks in public procurement, embezzlement of public funds, and questions that probe the strength and effectiveness of public sector anti-corruption efforts...It captures information about the administrative and political aspects of corruption.

In response to global distrust, the Anti-Corruption Council meeting on January 13, chaired by Russian President Dmitry Medvedev, outlined Russia's emphatic difficulties with bureaucracy. The President sketched out a plan for reform, while emphasizing the need for civilian cooperation in all anti-corruption initiatives.

[Jan 03, 2014] Taylor vs. Summers on Secular Stagnation'

That is politics not economics and, clearly, as for Taylor, it comes down to the usual question: are Republicans more stupid of more evil.
Jan 03, 2014 | Economist's View

Here's the Jared Bernstein response to John Taylor that Roger Farmer is referring to:

Taylor v. Summers on Secular Stagnation: ... In a recent speech I've featured here in numerous posts, Larry Summers raised the possibility that the economy is growing below its potential, with all the ancillary problems that engenders (e.g., weak job and income growth), and not just in recession, but in recovery. Stagnation is by definition expected in recession, but not in an expansion...
Taylor argues, however, that secular stagnation is "hokem." His argument rest on two points, both of which seem obviously wrong.
First, he claims that the current recovery has been weak is not due to any underlying problems in the private sector or lousy fiscal policy, but due to "policy uncertainty, increased regulation, including through the Dodd Frank and Affordable Care Act." But the recovery began in the second half of 2009, well before either of those measures took effect. And, in fact, since they've done so, if anything, growth and jobs have accelerated. Financial markets have done particularly well...
Taylor's antipathy toward fiscal stimulus leads him to completely omit the fact of austerity in the form of fiscal drag as a factor in the weak recovery. ...
His second argument is that if secular stagnation were a real problem, we would have seen it in the 2000s expansion, yet instead we saw "boom-like conditions, especially in residential investment." ...
Yes, there was a lot-too much-residential investment, but employment growth was terribly weak...,the share of the population employed actually declined. Real GDP grew almost a point more slowly per year over the 2000s business cycle relative to the prior two cycles. Business investment grew less than half as fast in the 2000s than it did in the 1990s. In fact, after rising pretty steeply in the 1990s, CBO's estimate of potential GDP fell sharply in the 2000s..., a serious cost of the problem Summers is raising and Taylor is wrongly debunking.
It's also worth noting that middle-class incomes and poverty rates did much better in the 1990s, thanks to full employment conditions in the latter half of that cycle, than in the 2000s, when slack labor markets led to a flattening trend in real median income and increasing poverty rates.
I doubt any of this will convince Taylor and others who simply want to go after the ACA, the Fed, stimulus measures, et al. But those of us interested in blazing the path back to full employment should recognize these arguments as politically motivated distractions. ...

This post from Brad DeLong on the same topic is also worthwhile

pgl said...

If one has been reading Taylor's blog - ECONOMICS ONE - none of his latest partisan garbage in this oped would have come as a surprise. In the olden days - we would have to turn to Lawrence Kudlow and those Jerry Bowyer Fuzzcharts for such insanity. I wonder if Stanford is proud of its most famous macroeconomist. Cough, cough.

DeDude :

The thing that holds back businesses from deploying their stash of cash, is not "policy uncertainty" or "increased regulation". It is lack of demand.

If the demand is there then the product/service will be produced. When demand is not there then the cash will sit idle or be used non-productively for things like stock buybacks or takeover of competitors.

Any individual business owner who fail to meet demand (because of policy uncertainty or regulation) will simply give up market share to those of his/her competitors that chose not to be held back by those things.

DeDude -> Matt Young...

I am actually not talking about GDP. The issue is why do businesses not hire more people. The explanation that right wing fools and smart business people love to give is that it's because of regulations and policies that they don't like. However, as pointed out over on "calculated risk" they always complain about regulations and there is no correlation between their complaining (or not) and their actual hire of new employees. The only thing that determine whether a business will hire more people is whether the demand for its products/services is in excess of what can be delivered by its current workforce. And they will respond to such demand regardless of cumbersome regulations - or they will lose market share to competitors that are more than happy to fill the demand.

Fred C. Dobbs:

(Found out on the web.)

Definition of the term secular stagnation theory is presented. It refers to the protracted economic depression characterized by a falling population growth, low aggregate demand and a tendency to save rather than invest.

Dictionary of Theories;2002, p478

David:

I don't think the right word for Taylor's erroneous claims as chiefly "political". It's moral prejudice. The absolute belief in totally unregulated markets is based on the belief that

1. The wealthy are more virtuous than the poor.

2. Only the strong should survive (see Abba's song "The winnner takes it all").

So it goes from a.Moral Prejudice to b. Political ideology to c. Economic chicanery.

Moral prejudices are the most deeply rooted in human beings because they don't only dictate how the world is, but how it should be.

pgl -> David...

Aren't your comments better directed towards Greg Mankiw? Oh wait - they are both toadies for Mitt Romney. Sorry about my question!

bakho:

Taylor isn't right or wrong. Taylor is simply irrelevant to the largest social ill of 2014- Unemployment.

If one of the basic assumptions of your model is "Assume Full Employment" then employment doesn't become a goal but a constant.

Under the Assumption of Full Employment, is secular stagnation even possible?

Taylor's model does not even look at Unemployment, and reducing unemployment is not his priority.

If as a policy maker, your goal is to reduce unemployment as quickly as possible, you should find another model that addresses unemployment directly. Once unemployment is fixed, other models may be more useful as new problems pop up.

anne -> bakho...

http://www.nytimes.com/2008/11/30/opinion/30leuchtenburg.html

November 30, 2008

Keep Your Distance
By WILLIAM E. LEUCHTENBURG

Chapel Hill, N.C.

On Nov. 22, Hoover welcomed Roosevelt to the White House. Throughout the meeting, he treated his successor as though he were a thickheaded schoolboy who needed drilling on intransitive verbs. He sought to bully the president-elect into endorsing the administration's policies at home and abroad, especially sustaining the gold standard at whatever cost. Alert to Hoover's intent, Roosevelt smiled, nodded, smiled again, but made no commitment. A frustrated Hoover later vowed, "I'll have my way with Roosevelt yet."

Hoover returned to the attack in February. He sent the president-elect a hectoring 10-page handwritten letter that misspelled Roosevelt's name (as "Roosvelt"). As a consequence of the flight of gold and runs on banks, Hoover wrote, there was "steadily degenerating confidence in the future." His wise policies, he claimed, had brought an upturn in the summer of 1932. Since then, though, he said, there had been a sharp decline because the country was unnerved by Roosevelt's election, for it feared that the new president would embark on radical experiments. Hoover concluded by asking Roosevelt to restore confidence by stating publicly that there would be "no tampering" with the currency and that "the budget will be unquestionably balanced, even if further taxation is necessary."

Three days after writing this letter, Hoover told an archconservative senator that "if these declarations be made by the president-elect, he will have ratified the whole major program of the Republican administration; that is, it means the abandonment of 90 percent of the so-called new deal." To another Republican senator, he spelled out what he demanded that his successor renounce: aid to homeowners burdened with mortgages, public works projects and plans for a Tennessee Valley Authority. He also wanted Roosevelt to raise tariff barriers and impose a national sales tax.

Roosevelt, who regarded the letter as "cheeky," let days go by without replying, fibbing that his response had miscarried. He would not let himself be trammeled by being identified with an unpopular dying administration, so he refused to issue any statement. He would not permit Hoover to rob him of the fruits of victory. On March 4, unfettered, he announced to the nation a new beginning....

William E. Leuchtenburg is the William Rand Kenan, Jr. professor emeritus at the University of North Carolina at Chapel Hill.

sherparick:

I wonder if Tyler Cowen, James Hamilton, and Steve Williamson will take John Taylor to task for saying that Larry Summers and Ben Bernanke are just putting out a bunch of hokum to protect the Obama administration from its policy errors? No, I don't think so, civility and treating those who disagree with you with respect and deference is only something economists with liberal political leanings, who kind of care what happens to the rest of the American people, and not just the 1%, owe to their conservative, "scientific," betters.

It should not be forgotten that Professor Taylor was the Deputy Undersecretary of Treasury for Economics and Financial Issues from 2001-2004. That economic growth was anemic during this time is well documented.

http://www.calculatedriskblog.com/2014/01/question-1-for-2014-how-much-will.html

Has he ever explained his policy errors? As to hokum, I do acknowledge that Professor Taylor has a lot of experience peddling that for his political masters.

http://www.treasury.gov/press-center/press-releases/Pages/js452.aspx

How can Mark Thoma, Noah Smith, or Brue Bartlett have an honest argument with the likes of John Taylor. I hope he finds his bubble comfortable in side the right wing machine. I am sure he finds it lucrative.

P.S. Again, the evidence is that economic growth is picking up, just as both Dodd-Frank and the Affordable Care Act are coming into full effect. Correlation or causation? Are more likely just co-incidence?

kievite said...

This is an interesting topic which sadly attracted very few comments.

I think there are two issues not covered in comments:

  1. That is politics, not economics and, clearly, as for Taylor, it comes down to the usual question: "are Republicans more stupid or more evil" (see Robert Waldmann comment to the post from Brad DeLong ).
  2. The level of debt and the price of energy are two important variables that should probably be taken into account in any discussion of secular stagnation.

As for Taylor personal legacy, I would suggest that the underlying assumption that there is an exogenous NIARU (non-inflation-accelerating rate of unemployment) imposing an unavoidable constraint on macroeconomic possibilities is wrong on both historical and analytical grounds. From a historical standpoint, a NIARU, if it exists at all, must be regarded as highly variable over time and place.

To me it smells with the desire to enlist the fear of inflation to justify the maintenance of a "reserve army of the unemployed" in the society (which is a Marxist term, but probably is applicable here). In a way high level of unemployment is a precondition to the fast redistribution of wealth that we observed under the current neoliberal regime.

Which is another way to say that Taylor is a stooge of financial oligarchy. A Trojan horse which plays the role of an academic economist.

[Nov 03, 2013] Plutocrats vs. Populists

Economist's View

Dryly 41 said...

Much of this is nonsense. The idea that Larry Summers was opposed by "The left wing of the Democratic party..". is pure nonsense. Clinton, Robert Rubin, and, Larry Summers led the Wall Street wing of the Democratic party to join with right wing Republicans such as Alan Greenspan, Phil Gramm, Newt Gingrich, and, Thomas Bliley to eviscerate the "strict supervision" of the financial system and return to the Laissez Faire approach of Warren G. Harding, Calvin Coolidge, Herbert Hoover and their Treasury Secretary, Andrew W. Mellon. The New Dealers referred to Harding, Coolidge, Hoover, and, Mellon as "Lazy Fairies". You could make the case that Clinton, Rubin, and, Summers were even lazier Lazy Farries than President Calvin Coolidge, his Treasury Secretary Andrew W. Mellon, and, Commerce Secretary Herbert Hoover, since, in 1927 Coolidge signed into law the McFadden Act which place restrictions on interstate branch banking. Small banks wanted the McFadden Act but there was also a recognition that the economic and political power of the Wall Street banks should be curbed. Eisenhower signed the Bank Holding Company Act of 1956 which extended McFadden Act restrictions to bank holding companies. In 1994, Clinton signed the Reigel-Neal Act which repealed the McFadden and Bank Holding Company Act of 1956, thus, creating "Too Big To Fail" financial institutions. In 1999 Clinton signed the Gramm-Leach-Bliley law which removed the restriction on commercial banks from joining with investment banks prohibited by Glass-Steagall while retaining the deposit insurance liability of the Federal government signed into law by FDR on June 16, 1933. In 2000 Clinton signed the Commodities Futures Modernization Act prohibiting any regulation of derivatives.

When does a set of policies that have proved successful, such as the "strict supervision" of finance which provided the longest period of financial stability in American history, suddenly become "extreme" advocated by "Left wing" Democrats? I would argue they are not "extreme" but conservative. As we have seen again Laissez Faire doesn't work too well.


Gibbon -> Dryly 41...

That is absolutely true, strict supervision, and interstate firewalls to prevent financial contagion, limits on the size of finance companies to prevent 'too big to fail' are pragmatically conservative not looney liberal. Point mostly excellently argued.

Also one of observations, conservative policy in the US aren't conservative at all. So much conservative policy to me these days seems like just a bunch of threadbare and moldy fig leaves covering superstition, fear, and greed.

One comment I also have is that plutocracy as currently encultured can't bring itself to offer up anything to the middle classes and the poors. So they have nothing they are willing to offer, more the demands they're making on the economic distribution means that there gains have to come from at the expense of the rest of us. Not just a lower percentage share, but lower in absolute terms. I think more than anything, this is what's driving things.

Dryly 41 -> Gibbon...

I agree that the use of terms is incomprehensible in this era. One striking example; "supply side" tax cuts for the wealthy by Ronald Reagan were denominated as conservative. No! In fact that was a radical, radical departure from traditional Republican party orthodoxy from its inception in 1860 through 1980. In the twenty years of Reagan and Bush family presidencies not one budget was balanced and the Gross Federal Debt was increased from 32.5% to 85.1%-and this notwithstanding Clinton raised taxes and reduced the debt by 9.7%.

Not only was "supply side" radical for the Republican party, it was radical for any party in American history. Nothing like it has ever been done, and, it was not done for any great national purpose such as incurring debt for the Revolutionary War, the Civil War, WW I, or, WW II. All those trillions were borrowed to fund tax cuts for the wealthy.

Nothing "conservative" about that.

[Oct 20, 2013] 'Congress all bribed, has zero confidence in eyes of American people' - World Bank whistleblower

The Federal Reserve is printing dollars like there is no tomorrow, and if they keep going, the rest of the world is not going to accept them.
RT SophieCo

Sophie Shevardnadze: Our guest today is whistleblower Karen Hudes, former senior counsel at the World Bank. Karen, it's great to have you on a show today.

SS: So, the government shutdown. Is the move on the part of the Republicans justified? Is fighting off Obamacare worth all this mess?

KH: I think there is something more going on behind the scenes. A lot more, actually.

SS: What do you mean?

KH: Well, there is terrible currency problem. We're on the verge of the currency war. The Federal Reserve is printing dollars like there is no tomorrow, and if they keep going, the rest of the world is not going to accept them. As it is, the BRICS countries – Brazil, Russia, India, China and South Africa – have decided that they are going to finance the trade among these countries with assets and pay for the difference in gold. And this is the right move for them...

SS: But how is that connected with a shutdown though?

KH: The US Congress has been fighting with the presidency, because the presidency have been in total contempt, and the highest legal officer of the United States government has also been in contempt of Congress in fighting this international corruption that is ruining the dollar as an international reserve currency.

SS: But you know, economists have been predicting the dollar will fall ever since the crisis in 2008. But the Government has managed to keep it afloat.

KH: Well, not for long. If you look at what's going in the gold and other precious metals markets, silver as well, we're headed towards something called "permanent gold backwardation"- that means there is a loss in confidence in the fiat currencies that are issued by those private banks. They like to consider themselves as 'public banks' but they really are owned by private entities. And these currencies are about to crash because they are valueless, that's what always happens to paper currencies that aren't backed by assets.

SS: Like you've mentioned - "gold backwardation", gold is often chanted as perfectly safe investment and alternative to the dollar, even. But how come the price of gold is falling?

KH: Because of market manipulation - but that can only continue for so long because the Central Banks are running out of gold and the rest of the world are lining up to buy them. If you want to buy gold today, you have to pay a premium. What they are offering in the future is called 'a naked short'. They don't have the gold to back those offers, that's illegal what they are doing.

SS: I will get back to gold in a bit. But for now I would like to focus on Obamacare. In your opinion, is Obamacare really that crucial for the US economy?

KH: What you have is something that's very good for the medical insurers because most of the other countries that offer medical coverage do this through a single issuer. And that's not what we have here. What we have here is a bill that was drafted by the medical insurance companies. It's not good for this economy. It never was.

SS: Why do you say it's not good?

KH: Because what's happening is that workers that worked full-time are being put deliberately on part-time basis, so that the companies can avoid giving the medical insurance coverage under the provisions of the law.

SS: You know this Obamacare thing.. I've heard it many times being compared to Socialism, Communism sometimes even. Do you trace the resemblance?

KH: That's just because the mainstream media, when they report about what's going on, are doing it by telling lies and anything that's good for the powers that be. The mainstream media is completely owned and controlled by the same companies, private companies that own the Federal Reserve System. Most of the American citizens are clueless about the corruption that's rifling their economy.

SS: But just to make sure - are you saying that everything about Obamacare is bad? Or are there good things about it?

KH: No, of course, there are good things about it. But the problem is that the people that wanted to get up decent coverage were not given the tools, they were not given the equipment, they were not given the press coverage – the honest press coverage, that society needs to enact just legislation. The Congress people are all bribed by these corrupt forces and the American citizens have zero confidence in their Congress.

SS: So, at this point you side with the Republicans for blocking the medicare.

KH: I'm not siding with Democrats or Republicans, because both of those parties have been co-opted by these terrible corrupt forces I'm talking about.

SS: What we have right now is Americans being forced to get health insurance. How does it go with their love of liberties and freedom of choice?

KH: It's not so much a question of being forced; you have to look at those parts of the society that have been thrown under the bus. The uneducated children, who are not given superior education, like we used to have. We are society that is giving short shrift to the people that need us. I'm not saying that we ignore the health needs of our country. I'm saying that we ignore the mainstream media, because they are not telling us the truth.

SS: You know, I've also heard Obama supporters argue that the American Capitalism is on the verge of death in its present form, the way it is existing now, and the social injections, meaning the medical care and Obamacare, are needed as the only way to reform it or save it. Do you agree or disagree with that?

KH: The problem is not with the American citizens, they are a wonderful group, their values are good. It's just that they are not given the tools that they need to have a just society. They are not given the basic information about what is really going on and who is benefiting from the economies that they are being told… they are being told that they have no money, they have taken an entire city, Detroit, and declared it bankrupt. When what's actually happening is their tax dollars are not even staying in the society, their tax dollars are going by treaty to the United Kingdom, and then they are being transferred to the Vatican, to the bank of the Vatican. This is not a society that is going to be sustainable on any basis, for any reason.

SS: Do you feel like American economy is picking up because we hear President Obama saying the shutdown hurts American economy but at the very sensitive moment, word is it has just started to catch up. Do you feel like it's catching up really?

KH: Those numbers about the employment are completely fabricated because they are not counting those people who have given up ever finding a job as unemployed. That's ridiculous! The real rate is just about double what they reported as being.

SS: So the American debt looks like a doomed patient. Is there any other possibility for it than just grow into eternity forever? I mean raising debt ceiling once or twice a year, what's the problem?

KH: The problem is actually when you talk about debt, is that our currency is financed by debt; our currency is issued by the Federal Reserve instead of the Treasury which is unconstitutional. When the Federal Reserve System was instituted in 1913 most of the Congress was on break, they sneaked that legislation through. So the debt is there simply for those bankers to put in interest on it and have it grow and compound every year. The debt is a fabrication, it's probably should be repudiated. But it can be repudiated until you'll have looked that all of the implications.

SS: Do you think it's going to go on and on forever?

KH: No, what I think it's going to happen is that at the upcoming Bretton Woods meeting on October 9th the countries of the world, the foreign ministers of the world are going to sit down and have a rational basis for currency rather than this fiat currency which is absolutely... what can I say, it makes no sense to anyone but the bankers that are issuing it.

SS: So, when you look at the concept of the debt, it's much more than just borrowing money - it makes you controllable. For example, in the case of US - who controls it, you mean the big corporations, or countries like China and Japan, who control large chunks of the debt?

KH: Well, that's a very good question and, fortunately, some mathematicians at the Swiss Federal Institute of Technology have given us a very precise answer. They did a study of who owns and controls the companies on the capital markets - 43 000 companies. They found out that there is "a secret super-entity", they call it, that owns 60% of the earnings every year and 40% of the assets. They did this by putting the same people on the boards of these companies. So, they have ten times the economic power than there are entitled to. And they thought that none would catch them at it. This is a huge conglomerate that has been rigging the labor prices, it has been rigging all of the commodity's prices, and it has been trading in the securities markets with the insider information. It has got to be stopped. It also bought up the media and has been lying to people deliberately. This is going to stop.

SS: So just to answer my question - the government is controlled by the conglomerate or the corporations rather than countries that are up and coming economically, right? Why haven't these corporations or conglomerate, as you call it, been caught? Why is nothing changing?

KH: That's the whole point about it. They'd like to think they are in control but they are not, they are not above the law. And we, citizens, know exactly what they are up to, we've been working on this problem, all of the governors of the States have been working on this terrible corruption, so have the Attorneys-General, so have the Sheriffs, and it's not going to continue. The American people are taking back their government and they are stopping this terrible corruption.

SS: As of today, the United States is a financial heart of the world. Whether it collapses or keeps on going, it's obviously wrong – this much power is concentrated in one place. Asia is a rising monster right now; could it be stealing this financial role from the US? Do you think China, for example, could steal its financial role from the US? Or are they also controlled by that same financial elite you're mentioning?

KH: Well, I can tell you that the Jesuits have a very strong stranglehold on China as well but I can also tell you that the transition of economic strengths from the western countries to the east is going to happen, but it's going to happen in a smooth way. It's not going to be a transition through a currency war like that terrible corrupt group is trying to manipulate everyone into. No, we're going to have a peaceful power transition this time around; we're not going to have the World War III. They try to pull it off in Syria, they are now thinking they can pull it off in Iran, it's not happening. The citizens of the world see what they are doing and we're not letting them get away with it this time.

SS: Foreign governments keep buying US Treasury bonds despite obvious problems US economy is facing. What's making them do that, in your opinion?

KH: I think the biggest market for the Federal Reserve notes is the US Treasury and there is a gut of dollars right now. But, yes, there is also a small market, unfortunately, the market is weakening as the dollar weakens because of all of this, what they call quantitative easing, where every month so many additional dollars are printed with absolutely no backing.

SS: Should we be buying gold?

KH: Well, yes and no, I think gold is probably a wise purchase right now, but more as insurance than investment, because there is actually a great deal of gold, there is even more gold than people know about. For example, the amount of gold in the deposit in the Bank of Hawaii is 170 000 tonnes, this is more than the World Gold Council says is available for all the gold on the Earth. People don't know how much gold there is, there is a lot of gold.

SS: Are you buying gold?

KH: I did actually, yes. But not because it's an investment, but because I'm not 100% certain that we're going to get to act together before all of the paper fiat currency falls apart. So I see it as insurance, but because of the amount of gold that's actually around in the world in deposit all over the world I'm not so sure it's a great investment.

SS: So you think the return to the gold standard is a realistic thing? It could be a possibility?

KH: Well, actually, that's not such a good thing. The currency ought to be backed by value, but there is no reason why it should be restricted to precious metals, it could be any of the commodities that are valuable. The important thing is that, yes, the currency should be backed by assets rather than by debt as we now have.

SS: But if a financial collapse happens , let's say, will gold be of any use? I mean, there is shortage of food, look at the world today, the biggest problem we're facing is the clean drinking water. What gold is going to do about that?

KH: First of all, I think that we're going to manage to get our act together; I'm not expecting a collapse. Very accurate game-theory model is showing that we're going to manage to make a transition in a very smooth way; maybe there'll be a few fits and starts, but I think most of the countries in the world are in favor of working together and not to have a collapse. The only thing that you're saying is that some of these crooks haven't figured out, they haven't seen the writing on the wall, they haven't seen that we understand that there is a way to work together and avoid these problems, which are definitely avoidable.

SS: So, Karen, you were a senior counsel at the World Bank. Tell me something, honest banking is this an oxymoron?

KH: No, we have examples all over the place - in the United States, the state of North Dakota has its own state bank and many of the other states are looking at that - at the moment 22 other states are looking at it, and we're urging the other 28 states to look at it. There was a bank in Amsterdam that, I think, went on for 300 years with no problem. We know how to do banking, it should be like infrastructure to support the economy, it shouldn't be for the benefit of elites that think they are above the law as we currently have. If you look at the Bank for International Settlements (BIS) - that institution was established when the war reparations were being exacted from Germany after the World War I. That's when it was started in 1930 and I believe its 60 central banks, that are members of the BIS - those are the corporates, those are the ones that really needs to go out of business.

... ... ....

Bill Otinger

Google video FIAT EMPIRE and on youtube see video THE SECRET OF OZ

[Oct 20, 2013] 'We face a crisis of epic proportions, Circus Clown College in Congress a joke' - whistleblower

October 18, 2013 | RT SophieCo
Download video (181.08 MB)

Is the drama in Washington, a comedy or a tragedy? What's a better term for American democracy? When will the debt time bomb detonate? Who can stand up against American exceptionalism? We discuss this and more with National Security whistleblower, Mark Novitsky

.Sophie Shevardnadze: Our guest today is another national security whistleblower, and no it's not Edward Snowden – his name is Mark Novitsky and he joins us from the American city of Minneapolis.

So the drama in Washington – what was it? Is it a comedy or a tragedy?

Mark Novitsky: It's really disturbing to refer to what's happening in Washington as a joke, and on behalf of all critical, clear-thinking Americans I want to apologize to the rest of the world for our Circus Clown College in Congress, and only the American Congress could pat themselves on the back and break their elbows for kicking the can down the road instead of actually doing their job, and delaying this for another three months on an issue that they should have handled couple years ago.

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Read the full transcript

SS: There is no default this time, but only for now, the root causes aren't really going away, be they political or economic, don't you think?

MN: The situation is that actually there was a default, we went into default in May, and the Treasury department actually started dipping into US government pension funds to make up for that deficit. All of these things are really scary and I think that we would have to take a look at these issues as if what would be the consequences for the average person if they were to pile up their credit card debt to the point where they can't afford to pay their mortgage and going to get another credit card – there has to be some type of resolution to all of this nonsense from an economic perspective. I think the first thing you do when you're in the bottom of the hole is stop digging.

SS: Why is it that every draft bill turns into existential crisis for Congress? I mean, beforehandCongress was somewhat able to make more pragmatic decisions, come to an accord – but now it's all about life and death struggle..

MN: Because the concept of social control being best managed through fear predates Christ from a political perspective, and in order for there to be fear so that one may have social control have to have a crisis. People often tend to refer to me, saying "Mark, you're so negative!" That's because we have a new crisis every week that we need to deal with and the way that we end up dealing with this crises is piling them on top of each other and nothing ever gets resolved. We need to hold our government officials accountable to the rule of law, to the Constitution, and I want to thank Russia Today for having me on, because the media is such a big component of that – and, tragically, Americans find themselves the best-entertained people on the planet and the least informed. But I think that that tide is turning, people are starting to understand the use propaganda, and being a little bit more selective.

I'll be honest with you – when I told people that I was going to do a program on Russia Today people were saying "why would you do that? You're going to look like a Commie!" And I said, "Listen, you need to broaden your perspective. You need to find a news source or news service that doesn't just tell you what you want to hear." You have to be critical, you have to think about what they are trying to sell you, when you're talking about the news. What becomes news here in America is when a teen actress named Miley Cyrus sticks her tongue out and gets more naked and there's three hours' programmed on CNN.

SS: Well, thank you very much for being so positive about Russia Today, but talking about narrowing things down or broadening them – American Democracy is narrowed down to two parties and even then the Congress fails to agree on things. Is there a better term than "democracy" to describe it?

MN: Feudalism, I guess. Pseudo-democracy. We are in the United States of America and we ended up coming down to having a choice between two pre-selected candidates who spend the most money. A look at what just transpired with our country and our government with regards to this "every six month debt limit increase" or it's a fiscal cliff, or it's austerity – there's always something to be afraid of, but at this point in time if we look at the television and see these two idiot teams bickering and fighting back and forth.

I'll be candid with you, when I have a mental image of American politics I see two warring factions of chimpanzees baring their teeth and screaming at each other and waving and flailing their hands above them and throwing feces at each other. That's where we are at. We got to get back to being the beacon of freedom, the beacon of democracy, the beacon of common sense.

SS: The American debt looks increasingly insane with no improvements or even signs of desire to pay down. Where is the US going with it?

MN: That's a situation that we are afforded having a luxury being the international reserve currency of the world, and with that should come a certain responsibility. There have been periods of time when governments have been the international reserve currency of the world, you know, pre-World War II it was the UK, before that that was Spain, before it was Portugal – so a country being in the position of holding an international reserve currency is not a static thing. What we have to take a look at is getting our spending under control, eliminating useless and severely detrimental wars that we're involving ourselves in relation to support of the military industrial complex. We should be like a responsible adult, pay what we own and live within our means.

SS: The US is printing money in enormous amounts to serve its financial purposes – it is their national currency, of course, but it's also an international commodity, whose consequences resonate through every corner of the world, including riots and revolts in countries with destroyed economies. Is this an American exceptionalism at play?

MN: I'm troubled by the fact that president Obama mentioned the word "American exceptionalism", because I think that God created us all equal. That's kind of a point that I would not have made, especially to the UN General Assembly. Somebody has to do it. Somebody has to be the international reserve currency, there has to be oversight, there has to be transparency and that's where the process or procedure of improvements needs to be made.

We have a system that's broken. We have to find the best and the brightest people in the US and internationally, that have the resolve to correct the problem. We're off the tracks, we're off the rails and so we can't go back to continuously doing the same thing. So we need to put a team of objective independent critical thinkers behind the problem and address these concerns.

SS: But do you personally think America is exceptional?

MN: Well yes, I do. And I think that we have a potential for being exceptional. But again, do we have problems? Yes, we do. But do we have the capacity to address these problems? Yes we do. I think a sense of nationalism is something inherent in every society and that's a good thing. But what we have to do is to be grown ups and understand that not everything we do is in the public's best interest and rein in those people that are taking us off the rails.

SS: Is there any valid force to stand up to this exceptionalism in the form we have it now?

MN: The people, the American people and the people of the world. You know, the internet, in what you're doing here has changed so much, because information is power, and the fact that we have so many avenues for information and sharing information. I really have not been allowed, and nor has Karen Hudes, nor have many people been allowed, to say the types of things we're saying to the American media. That has to change and that's why I thank Russia Today for having the opportunity to express this opinion and to say that this can no longer be confrontational, we're all in the same team and we all need to work together. This is a crisis of epic proportions – if the US goes down, tragically, we're going to take the rest of the world down with us, and so we have to look at this as a global concern.

SS: You are a national security whistleblower – tell us your story. Has your story resonated at all?

MN: Yes and in fact, I'd like to lead off with the fact there's a national security whistleblower coalition, and the senior academic advisor - his name is William Weaver - actually advises people against being a national security whistleblower, that if you do that you'll be destroyed, you'll go through character assassination, you will lose your family, your job, you'll lose your credibility and that goes back to the way that you can tell a society is in decline by how they treat their truth-tellers.

Now, this whole issue of Ed Snowden and national security and domestic surveillance – as everyone knows, this is international surveillance issues and concerns. I worked for a company called Teletech Holdings, which is headquartered in Denver, Colorado. I was illegally and maliciously sued by this company in federal court. Against all odds and unlimited resources of Teletech's legal coffers and basically pro se, I managed to fight Teletech's illegal and malicious accusations and charges against me, to win a dismissal with prejudice. And in the end of that term I thought that that was a victory and it really was it, because early on in the situation I was warned by the former CIO – its chief information officer at the Teletech subsidiary I used to work for – that Teletech had the capacity to wiretap my phones and ISP and they would see to it that I would never work again.

Now, at that point in time I had no idea that this company was involved internationally and had a special subsidiary called Teletech Government Solutions. It was couple of weeks after that warning that my son found two people in the house, that I presumed to be people that were setting up to attach wiretaps to the phones. We know that they don't need that information now, but what I understood was that Teletech had friends in very high places and they would see to it that I would never work again, and tragically that was the case.

The further along I got, I realized I was on the receiving end of the domestic surveillance, and that this was a government contractor, and they seem to be receiving preferential treatment and cover by the government. So I did everything the whistleblower is supposed to do. I went to the media, I went to lawyers, I went to, then, my Congress people…

SS: But did your story got out, did people listen to you?

MN: None whatsoever. I mean, I handed people a Pulitzer Prize-winning story on a golden platter, and people in the media would say "Oh my God, I can't believe what you're telling us!" I came to them with everything that I'm going to tell you and everything that I've got is public record information. I'm not telling any top-secret information.

See, there is the thing of the internet that if Congress and their staff actually wanted to, they could find a whole lot of information. So when President Obama and members of the Congress say "this isn't about spying on the American citizens," that is blatantly untrue. And I am a victim of that.

Based on the information and belief, on everything that I've gone through, I've been blowing the whistle on the fact that the government is going after whistleblowers, they're going after journalists, they're going after government employees, they're going after lawyers and judges. Think of the ramifications of all of this. If George Orwell was alive today, he'd do a spit-take about what's going on. One of the points that I wanted to try to make was just how long has this been going on and sent you some information, with respect to some of the programs the government has been involved into. That goes back to '60s!

SS: Mark, you're saying that no one will hire you, you're being tapped, no media will take your story. Are you reaching your goals? Is whistleblowing worth it?

MN: You know, somebody has to do it. If not me or us, then who? What I advocate is... I mean, was it my life goal to become a martyr? Absolutely not, I had unrealistic expectations of how I would be treated by the media, by the government officials. I figured that if I went and provided all of these documents and the information to the government officials, about domestic surveillance perpetrated against the American citizens that is being covered up. And I was essentially told that under the Patriot Act, it's against the law for the government officials to tell you if you are under surveillance. In fact, my senator Al Franken recently commented in a CNN op-ed, and I'm going to paraphrase what he said: "If we told the American people what the NSA was doing, then Congress could face federal charges for leaking information."

SS: To get back to whistleblowing. Do you believe people can fight back their right to know what is going on and to govern the process? What needs to happen to make them actually start pushing?

MN: In the US we're presumed to have equal access to courts and equal access to due process of the law –if you can afford it. The way that our – I don't call it "justice system" – our legal system works, it a for-profit enterprise. And so, here I went to the majority of the largest local and national associated law-firms, and I laid down my case for them about this hostile abuse. I took this to the state attorney-general, and at the time the deputy attorney-general looked at me and said that this is one of the most egregious acts of civil injustice that he had ever seen, but there was nothing he could do.

When I went to a variety of lawyers, they looked at this and said "Oh my God, this is horrible. This was a travesty of justice. This was a lawsuit brought against you with no evidential support and this was a hostile and malicious attack!" But they said there's nothing they could do, unless I could afford to pay them $250,000 upfront for the retainer.

A corporation of the size of the Teletech is just going to outspend you. That's not a justice system. Also, we have a real big problem with a judiciary and the rulings of the court. I think it would be in the best interest of the US and the world that if we actually had a whistleblower protection program to be in place and afford credible national security whistleblowers and financial whistleblowers.

I am also a financial security whistleblower, in 2007 and 2009 associated with my case with the Teletech, I found out that there was a hotline in the SEC, the Security Exchange Commission, to stop or stall investigations and this in fact happened to me. So I went to Congress and told them first in 2007 about this hotline and showed them the evidence. I also warned about the 2008 financial collapse - hundreds and thousands of people actually warned about the 2008 collapse – and nothing happened. Because as I said earlier in the conversation, there is a need to have a crisis.

I think it was Mayer Rothschild who said that the best time to buy is when it's blood in the streets, and so we create this crisis and these bubbles, and bubbles are built to explode, and we start the whole process all over again. What we need to do with the whistleblowers, and this was a promise that Obama made when he was a senator and when he was candidate – that whistleblowers represent the best of the US and we need to do everything in our power to protect whistleblowers – when in fact he had done specifically the opposite, and had seemingly attacked whistleblowers with a bloodlust, and keeping things private and secret. That's getting back to "you can tell where society is headed towards how they attack their truth-tellers"

SS: Mark, I want to talk to you a little bit about the credit crunch of 2008 and its consequences. We've seen stocks drop, bailouts, bankruptcies, riots – most agree the major financial institutions were to blame, but nobody really bore the responsibility for that. Can you explain to our viewers, who you see as the main players – banksters you've talked about?

MN: That's the problem. Everything you talk about can be fixed and should have been fixed. I could take American 5th-graders and show to them and demonstrate really to them that these financial crises were not only preventable, by all appearances they look like they were intentional! Again, what happens here impacts the whole world's economy.

In 2005, mortgage companies and banking institutions and rating agencies coalesced together into this massive concept of fraud and were pushing this fraudulent mortgages on to people and signing people up for houses that they couldn't afford, knowing that this was going to be a big problem, and then bundling those packages together and selling them on international market, knowing that they were going to default, and then, against the advice that were giving to their customers, actually shorting the investments and securities that they were marketing and promoting to their customers that were not in the loop.

There was information with respect to Fannie Mae and the massive and systemic fraud and abuse by Fannie Mae, but the chairman of Fannie Mae at the time – it was a guy named Franklin Raines – he ended up getting a $2million bonus! So tragically with President Obama and Attorney-General Holder, who comes from the Defense industry, protecting the white-collar criminals, they haven't grasped the concept that crime expands to our willingness to tolerate it.

The system seems to be gamed for the incentive of fraud and corruption and abuse. Until we start putting bankers in jail for their crimes against humanity we're going to continue with the same problems. But when we go to our congresspeople, to the regulators, when we go to the FBI - all things I've done – I was not only shunned, these people started working against me, and that's not how the program should work.

[May 11, 2013] The Neoliberal Harvest Routine Economic Fraud Dr. Jörg Wiegratz

May 10, 2013 | Truthout

Are you tired of yet another revelation of fraud in the food industry or the banks? Are you paying less attention to those stories? Are you getting numb, thinking more and more "that's just how the system works?"

If so, congratulations! You're learning to lower your expectations to meet the new normal: pervasive, institutional economic fraud. This used to be the sort of thing you read about in income-poor countries in Africa and South America. Nowadays, though, it turns out (yet again) that We Do It Too, and not just the usual suspects in the shadowy corners of the arms trade. Supermarkets and the rest of the food industry, pharmaceutical firms, hospitals and care homes, housing and construction, great swaths of the financial sector - tales from all of these show that fraud and trickery are in the mainstream, the New Black of commercial life. In particular, there appears to be an expansion of organized fraud in the economies and markets for legal, everyday goods and services; the recent horsemeat scandal in Europe is one example of this. And it is not just companies. There's corruption and crime in governments here and around the world: crony capitalism, powerful oligarchies, elite criminality.

All of this raises crucial questions about contemporary capitalist societies. What norms, values, beliefs and attitudes, what ways of thinking and reasoning, shape these practices? What brought these about, and encouraged so many people to take so much from the rest of us?

It seems as though Margaret Thatcher and Ronald Reagan and their powerful backers have a lot to answer for. I say that because my research into fraud points to the importance of the neoliberal talk, policies, programmes and transformations that became important starting in the 1980s. This neoliberal economic and political transformation brought with it a moral transformation. High levels of fraud and trickery, it appears, are the result of the extensive changes in political and moral economies that occurred across economic sectors, the state and communities in those countries that experienced neoliberal transformation.

If the conclusions I have drawn from my own research are generally correct, then dealing with that fraud and trickery is more complicated than many people seem to think. Talk of social enterprise, responsible capitalism, corporate responsibility and the rest might sound nice (to some). But unless we investigate and think carefully about the moral-economic and interrelated political-economic aspects of neoliberalism, that talk is likely to be little more than campaign promises from a tainted political class and hot air from a tainted corporate class.

For scholars interested in economic fraud in the West, the past few years have provided a vast number of cases and huge amounts of information. And yet, few academics are prepared to collect and analyze the data on this historical shift to "fake capitalism" in the West. We have scholars discussing the current economic crisis in conventional terms, but we have few who are concerned with that fraud and what it tells us about social change, power, accumulation and democracy. For most, it seems to be scholarly business as usual post-2008, and that is not good enough. We need a strong scholarly engagement with the realities of fraud and the related bundle of norms, values, practices and systems of power. With that, we can begin to challenge conventional narratives and models of the capitalist market, the sources of wealth, poverty and power, and the bases of people's culture and practices.

If we are going to try to fix things, we need to recognize that fraud is not simply a manifestation of culture. That is because that culture is shaped by the political economy that gives it force. Those who tell us that they want to change the culture in, say, the banking sector are fooling us, and maybe themselves, if they ignore the ways that cultural change works via political-economic change. That is because of a simple truth: if you want to change existing practice, you have to change existing structures of power. Hence, whoever wants to combat commercial fraud has to address commercial power. It is far from clear that our rulers are up for that.

However, if we are going to try to fix things, we also need to remember that fighting fraud does not mean giving morality to the amoral fraudsters and deceivers. Since Mandeville and The Fable of the Bees, we have been told that greed is good, that each of us serving our own interests serves the common weal. The current economic crisis shows how empty that fable is. But it should not blind us to the fact that all economic actors have a moral compass, even the fraudsters. They are guided by moral norms and codes of one sort or another. Those are the codes that lead people to say, perhaps, "Everybody tricks these days," "If I don't do it somebody else will," "Who cares?," "In business you have to be though - I can't afford to be nice," "I wouldn't be paid this much if I didn't make good decisions," "Looking after my family is more important than looking after strangers," or "If we all look out for ourselves, everyone will be better off." Economic fraud, then, signifies not the absence of moral norms, views and codes, but their presence. In other words, a moral norm does not automatically prescribe a pro-social practice such as solidarity, cooperation, honesty or justice. In a particular case, the actually existing moral norm - i.e. notions of standards of interaction regarding others' welfare and of what constitutes acceptable/unacceptable practice - among the actors involved can also be that it is OK, proper, or necessary to defraud (and therefore harm) another human being or social group (say, the poor, elderly, vulnerable, workers, customers and so on), for example to meet the corporation's target, to keep one's job, to survive, to defend or advance one's own power and wealth position or that of one's own family, social group, corporation, or country and so on.

That said, to combat fraud we need to understand it. We need to understand the systems of economic and political power that facilitate it and of the values and norms that justify it. Ignorance will not help us to see where the fraud comes from, and if we can not see where it comes from we can not even begin to see how to restrain it.

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[Apr 16, 2013] Corruption by Anup Shah

Apr 16, 2013 | theodoredalrymple.wordpress.com

Corruption everywhere; rich and poor countries, international institutions

It goes without saying, almost, that corruption is everywhere. Corruption in poor countries is well commented on (sometimes used dismissively to explain away problems caused by other issues, too). It would be futile to provide examples here (see also the sources of information at the end of this document for more on this).

Rich countries, also suffer from corruption. Examples are also numerous and beyond the scope of this page to list them here. However, a few recent examples are worth mentioning because they are varied on the type of corruption involved, and are very recent, implying this is a massive problem in rich countries as well as poor.

The first example is the US government, accused of outsourcing many contracts without an open bid process. Jim Hightower notes that "An analysis by the Times found that more than half of their outsourcing contracts are not open to competition. In essence, the Bushites choose the company and award the money without getting other bids. Prior to Bush, only 21% of federal contracts were awarded on a no-bid basis."

Another example is Italy, where former Italian Prime Minister Silvio Berlusconi and some of his close associates were held on trial for various crimes and corruption cases (though Berlusconi himself has not, to date, been found guilty of any charges). Many key teams in the massive Italian soccer league, Serie A were also found to be involved in a massive corruption ring.

In the United Kingdom, the arms manufacturer, BAE was being investigated for bribing Saudi officials to buy fighter planes, but the government intervened in the investigation citing national interests. The Guardian also reported that BAE gave a Saudi prince a £75 airliner ($150m approx) as part of a British arms deal, with the arms firm paying the expenses of flying it. This seemingly large figure is small compared to the overall deal, but very enticing for the deal makers, and it is easy to see how corruption is so possible when large sums are involved.

International institutions, such as the United Nations and World Bank have also recently come under criticism for corruption, ironically while presenting themselves in the forefront fighting against corruption.

The recent example with the UN has been the oil for food scandal, where the headlines were about the corruption in the UN. In reality, the figures of $21 billion or so of illicit funds blamed on the UN were exaggerations; it was $2 billion; it was the UN Security Council (primarily US and UK) responsible for much of the monitoring; US kickbacks for corrupt oil sales were higher, for example. (This is discussed in more detail on this site's Iraq sanctions, oil for food scandal section.)

At the World Bank, headlines were made when its recent president, Paul Wolfowitz, was forced to resign after it was revealed he had moved his girlfriend to a new government post with an extremely high salary without review by its ethics committee.

Paul Wolfowitz's appointment was also controversial, due to his influential role in architecting the US invasion of Iraq. A former member of staff at the World Bank also noted concerns of cronyism related to Wolfowitz's appointment way before the scandal that forced him to resign.

The US nominee for the next president is the former US Trade Representative and currently an executive at Goldman Sachs, Robert Zoellick. His nomination is also coming under criticism. Bush supports it, saying Zoellick "is the right man to succeed Paul in this vital work." Former World Bank chief economist, and Nobel Prize winner for economics, Joseph Stiglitz feels that instead of a political appointee, it would be better to get an economist who understands development.

As also reported by the BBC, Paul Zeitz, executive director of the Global AIDS Alliance, said that he thought Mr Zoellick was a terrible choice because "Zoellick has no significant experience in economic development in poor countries," and that "he has been a close friend to the brand-name pharmaceutical industry, and the bilateral trade agreements he has negotiated [for the US] effectively block access to generic medication for millions of people."

While the US typically gets its preferred nomination to head the World Bank, Europe has typically got its preferred person to head the IMF. Critics have long argued that this lacks transparency and is not democratic. While not illegal as such, it does feel like a form of corruption.

Address weaknesses in the global system

The Bretton Woods Project organization notes that the World Bank, under pressure of late, has suspended a number of loans due to concerns of corruption. These include loans to Chad, Kenya, Congo, India, Bangladesh, Uzbekistan, Yemen, and Argentina. The Bank has also started internal investigations of Bank corruption. However, "despite high-profile moves by president Paul Wolfowitz, the root causes of corruption-underpaid civil servants, an acceptance of bribery by big business, and dirty money-remain largely unaddressed."

The Bretton Woods Project adds that the "normalization of petty corruption in developing countries has in part been driven by"

To help address these problems, the Bretton Woods Project suggests a few steps:

During the 2002 World Summit on Sustainable Development, the BBC broadcast a mini debate on globalization, poverty, and related issues, and had a panel of around 30 experts, from both the developing and rich countries. One person on that panel was Vandana Shiva, a vocal critic of the current form of globalization and its impact on the environment and people in the third world. She was asked why people should listen to concerns from the third world when they cannot sort out the rampant corruption first. Her answer was simple: rich countries need to stop dictating policies that encourage corruption in the first place.

Like Shiva, Professor Neild feels that the solution is philosophically simple. However, as Neild acknowledges, in reality it is far harder to do, due to the power interests involved:

It is hard to see how the international economic agencies and their member governments can introduce incentives that would cause corrupt rulers to [attack corruption]… Not only are the rich countries and their agencies in this respect impotent, they commonly have been and are accomplices in corruption abroad, encouraging it by their action rather than impeding it.

… It is hard to see any solution other than transparency and criticism. It would take an unprecedented degree of united dedication to the checking of corruption for the international community to agree that the oil and mining companies of the world should boycott corrupt regimes, somehow defined, let alone manage to enforce an agreement.

- Robert Neild, Public Corruption; The Dark Side of Social Evolution, (London: Anthem Press, 2002), pp. 208-210, [Emphasis added]

[Jul 26, 2012] The Congressional Culture of Corruption

It is important to distinguish "micro corruption" (corruption on loser levels of goverment hierachy) and macro corruption -- Corruption of Congress.

economistsview.typepad.com

Jack Abramoff:

I Know the Congressional Culture of Corruption, by Jack Abramoff:

...No one would seriously propose visiting a judge before a trial and offering a financial gratuity, or choice tickets to an athletic event, in exchange for special consideration from the bench. Yet no inside-the-Beltway hackles are raised when a legislative jurist -- also known as a congressman -- receives a campaign contribution even as he contemplates action on an issue of vital importance to the donor.

During the years I was lobbying, I purveyed millions of my own and clients' dollars to congressmen, especially at such decisive moments. I never contemplated that these payments were really just bribes, but they were. Like most dissembling Washington hacks, I viewed these payments as legitimate political contributions, expressions of my admiration of and fealty to the venerable statesman I needed to influence.

Outside our capital city (and its ever-prosperous contiguous counties), the campaign contributions of special interests are rightly seen as nothing but bribes. The purposeful dissonance of the political class enables congressmen to accept donations and solemnly recite their real oath of office: My vote is not for sale for a mere contribution. They are wrong. Their votes are very much for sale, only they don't wish to admit it. ...

[Jun 01, 2012] A populist interpretation of the latest Boom-Bust cycle

naked capitalism

The Theory of Kleptocracy

First, let's use a theory from Guns, Germs, and Steel by Jared Diamond as the center-piece for this little theory. In Chapter 14, entitled "From Egalitarianism to Kleptocracy," Diamond postulates that more stratified societies are by definition less egalitarian, but more efficient and are, thus, able to eradicate or conquer more egalitarian, less stratified societies. Thus, all 'advanced' societies with high levels of GDP are complex and hierarchical.

The problem is: these more stratified, more complex societies are in essence Kleptocracies, where those in power re-distribute societal wealth to themselves. Those at the bottom of the society's pyramid accept this unequal, non-egalitarian state of affairs because they too benefit from their society's relative advancement. It's a case of a rising tide lifting all boats.

Diamond says the Kleptocrats maintain power using 4 different methods:

"1. Disarm the populace, and arm the elite."
"2. Make the masses happy by redistributing much of the tribute received, in popular ways."
"3. Use the monopoly of force to promote happiness, by maintaining public order and curbing violence. This is potentially a big and underappreciated advantage of centralized societies over noncentralized ones."
"4. The remaining way for kleptocrats to gain public support is to construct an ideology or religion justifying kleptocracy."

Kleptocracy in America?

The obvious corollary of this theory is that most successful modern societies are, in fact, kleptocracies. The key is to use the four methods to gain popular support in order to re-distribute as much wealth to the ruling class as the populace will support. If the ruling class takes too much, it will be overthrown and replaced by a new ruling class (which in turn will re-distribute wealth to itself using the same four methods).

While this angle seems cynical, it is a a line of argument that has great internal consistency.

So, is the United States a kleptocracy? Of course it is! Is that bad? Well, it obviously depends on who you are in society. But, it also depends on whether the kleptocracy is efficient and fair over the long term. Let me explain this last statement a bit more.

[Apr 8, 2012] Extortion, Capture, Looting, Propaganda. Our Modern Finance Industry.

April 8, 2012 | BEEZERNOTES

First, let's get something very clearly understood: More than three years after the Great Recession, all of our major banks, as well as the major banks in Europe, remain insolvent. From Yves Smith's brilliant book, Econned, How Unenlightened Self Interest Undermined Democracy and Corrupted Capitalism.

"Andrew Haldane, the Executive Director for Financial Stability at the Bank of England, concluded that it was impossible for the financial services industry to pay for the damage it wrought in the global debacle. The lowest plausible estimate of the total costs that he could come up with, amortized over 20 years, still resulted in a first year's bill that exceeded the total market capitalization of the biggest banks."

It took 40 years to unwind a regulatory structure that was the envy of the world. That regulatory discipline allowed America to become the world's greatest manufacturer. Common sense regulations, forged in the heat of the Great Depression and responsible for a long period of economic growth widely shared by the majority of citizens, were systematically dismantled.

As the dismantling progressed the nation's financial industry grew in size and profitability. Once only 8% of the economy, it soared to 25%. In terms of total corporate profits, finance grabbed more than 40% of profits. At the core of this expansion were a new class of financial 'innovations' called derivatives. Layered over traditional financial instruments like bonds, stocks, insurance contracts, commodity futures and related options, these derivatives exponentially increased the amount of money going into finance and, for all intents and purposes, dramatically under-priced risk. Derivatives had the nefarious effect of funding debt that was hugely under-priced, causing trillions of dollars in 'bets' to be made on all aspects of finance.

It wasn't just in housing mortgages either. This surge in under-priced debt went everywhere: Student loans, car loans, merger and acquisition funding, sovereign debt, insurance contracts–everywhere–you name the financial function and this explosion of liquidity drove down interest rates to the point where those rates couldn't come close to covering repayment problems or other risks.

The only solution is structural change that reduces the size and interconnectedness of the major actors. Given the fact that these 'major actors' provide the primary funding for political campaigns, including millions of dollars in political advertising aimed at influencing the public's understanding and perception of events, efforts to make structural changes face huge political hurdles.

Beezer here. Econned is the best book I've read so far, and I've read many, that explains in terms the average person can understand just how we got into this mess–and explain how we might be able to extricate ourselves without burning the whole house down. In our opinion the last bullet is obviously the most important. The public has to be better informed in order to understand that what we have now is decidedly not capitalism and the markets we have now are decidedly not 'free.' The first job is to take on the propaganda machine. It's giving the public a Potemkin Village version of reality. What we need is reality.

[May 05, 2010] Galbraith: The Role of Fraud in the Financial Crisis

economistsview.typepad.com

Recent testimony from Jamie Galbraith before the Subcommittee on Crime on the role that fraud played in the financial crisis:

Statement by James K. Galbraith, Lloyd M. Bentsen, jr. Chair in Government/Business Relations, Lyndon B. Johnson School of Public Affairs, The University of Texas at Austin, before the Subcommittee on Crime, Senate Judiciary Committee, May 4, 2010: Chairman Specter, Ranking Member Graham, Members of the Subcommittee, as a former member of the congressional staff it is a pleasure to submit this statement for your record.

I write to you from a disgraced profession. Economic theory, as widely taught since the 1980s, failed miserably to understand the forces behind the financial crisis. Concepts including "rational expectations," "market discipline," and the "efficient markets hypothesis" led economists to argue that speculation would stabilize prices, that sellers would act to protect their reputations, that caveat emptor could be relied on, and that widespread fraud therefore could not occur. Not all economists believed this – but most did.

Thus the study of financial fraud received little attention. Practically no research institutes exist; collaboration between economists and criminologists is rare; in the leading departments there are few specialists and very few students. Economists have soft- pedaled the role of fraud in every crisis they examined, including the Savings & Loan debacle, the Russian transition, the Asian meltdown and the dot.com bubble. They continue to do so now. At a conference sponsored by the Levy Economics Institute in New York on April 17, the closest a former Under Secretary of the Treasury, Peter Fisher, got to this question was to use the word "naughtiness." This was on the day that the SEC charged Goldman Sachs with fraud.

There are exceptions. A famous 1993 article entitled "Looting: Bankruptcy for Profit," by George Akerlof and Paul Romer, drew exceptionally on the experience of regulators who understood fraud. The criminologist-economist William K. Black of the University of Missouri-Kansas City is our leading systematic analyst of the relationship between financial crime and financial crisis. Black points out that accounting fraud is a sure thing when you can control the institution engaging in it: "the best way to rob a bank is to own one." The experience of the Savings and Loan crisis was of businesses taken over for the explicit purpose of stripping them, of bleeding them dry. This was established in court: there were over one thousand felony convictions in the wake of that debacle. Other useful chronicles of modern financial fraud include James Stewart's Den of Thieves on the Boesky-Milken era and Kurt Eichenwald's Conspiracy of Fools, on the Enron scandal. Yet a large gap between this history and formal analysis remains.

Formal analysis tells us that control frauds follow certain patterns. They grow rapidly, reporting high profitability, certified by top accounting firms. They pay exceedingly well. At the same time, they radically lower standards, building new businesses in markets previously considered too risky for honest business. In the financial sector, this takes the form of relaxed – no, gutted – underwriting, combined with the capacity to pass the bad penny to the greater fool. In California in the 1980s, Charles Keating realized that an S&L charter was a "license to steal." In the 2000s, sub-prime mortgage origination was much the same thing. Given a license to steal, thieves get busy. And because their performance seems so good, they quickly come to dominate their markets; the bad players driving out the good.

The complexity of the mortgage finance sector before the crisis highlights another characteristic marker of fraud. In the system that developed, the original mortgage documents lay buried – where they remain – in the records of the loan originators, many of them since defunct or taken over. Those records, if examined, would reveal the extent of missing documentation, of abusive practices, and of fraud. So far, we have only very limited evidence on this, notably a 2007 Fitch Ratings study of a very small sample of highly-rated RMBS, which found "fraud, abuse or missing documentation in virtually every file." An efforts a year ago by Representative Doggett to persuade Secretary Geithner to examine and report thoroughly on the extent of fraud in the underlying mortgage records received an epic run-around.

When sub-prime mortgages were bundled and securitized, the ratings agencies failed to examine the underlying loan quality. Instead they substituted statistical models, in order to generate ratings that would make the resulting RMBS acceptable to investors. When one assumes that prices will always rise, it follows that a loan secured by the asset can always be refinanced; therefore the actual condition of the borrower does not matter. That projection is, of course, only as good as the underlying assumption, but in this perversely-designed marketplace those who paid for ratings had no reason to care about the quality of assumptions. Meanwhile, mortgage originators now had a formula for extending loans to the worst borrowers they could find, secure that in this reverse Lake Wobegon no child would be deemed below average even though they all were. Credit quality collapsed because the system was designed for it to collapse.

A third element in the toxic brew was a simulacrum of "insurance," provided by the market in credit default swaps. These are doomsday instruments in a precise sense: they generate cash-flow for the issuer until the credit event occurs. If the event is large enough, the issuer then fails, at which point the government faces blackmail: it must either step in or the system will collapse. CDS spread the consequences of a housing-price downturn through the entire financial sector, across the globe. They also provided the means to short the market in residential mortgage-backed securities, so that the largest players could turn tail and bet against the instruments they had previously been selling, just before the house of cards crashed.

Latter-day financial economics is blind to all of this. It necessarily treats stocks, bonds, options, derivatives and so forth as securities whose properties can be accepted largely at face value, and quantified in terms of return and risk. That quantification permits the calculation of price, using standard formulae. But everything in the formulae depends on the instruments being as they are represented to be. For if they are not, then what formula could possibly apply?

An older strand of institutional economics understood that a security is a contract in law. It can only be as good as the legal system that stands behind it. Some fraud is inevitable, but in a functioning system it must be rare. It must be considered – and rightly – a minor problem. If fraud – or even the perception of fraud – comes to dominate the system, then there is no foundation for a market in the securities. They become trash. And more deeply, so do the institutions responsible for creating, rating and selling them. Including, so long as it fails to respond with appropriate force, the legal system itself.

Control frauds always fail in the end. But the failure of the firm does not mean the fraud fails: the perpetrators often walk away rich. At some point, this requires subverting, suborning or defeating the law. This is where crime and politics intersect. At its heart, therefore, the financial crisis was a breakdown in the rule of law in America.

Ask yourselves: is it possible for mortgage originators, ratings agencies, underwriters, insurers and supervising agencies NOT to have known that the system of housing finance had become infested with fraud? Every statistical indicator of fraudulent practice – growth and profitability – suggests otherwise. Every examination of the record so far suggests otherwise. The very language in use: "liars' loans," "ninja loans," "neutron loans," and "toxic waste," tells you that people knew. I have also heard the expression, "IBG,YBG;" the meaning of that bit of code was: "I'll be gone, you'll be gone."

If doubt remains, investigation into the internal communications of the firms and agencies in question can clear it up. Emails are revealing. The government already possesses critical documentary trails -- those of AIG, Fannie Mae and Freddie Mac, the Treasury Department and the Federal Reserve. Those documents should be investigated, in full, by competent authority and also released, as appropriate, to the public. For instance, did AIG knowingly issue CDS against instruments that Goldman had designed on behalf of Mr. John Paulson to fail? If so, why? Or again: Did Fannie Mae and Freddie Mac appreciate the poor quality of the RMBS they were acquiring? Did they do so under pressure from Mr. Henry Paulson? If so, did Secretary Paulson know? And if he did, why did he act as he did? In a recent paper, Thomas Ferguson and Robert Johnson argue that the "Paulson Put" was intended to delay an inevitable crisis past the election. Does the internal record support this view?

Let us suppose that the investigation that you are about to begin confirms the existence of pervasive fraud, involving millions of mortgages, thousands of appraisers, underwriters, analysts, and the executives of the companies in which they worked, as well as public officials who assisted by turning a Nelson's Eye. What is the appropriate response?

Some appear to believe that "confidence in the banks" can be rebuilt by a new round of good economic news, by rising stock prices, by the reassurances of high officials – and by not looking too closely at the underlying evidence of fraud, abuse, deception and deceit. As you pursue your investigations, you will undermine, and I believe you may destroy, that illusion.

But you have to act. The true alternative is a failure extending over time from the economic to the political system. Just as too few predicted the financial crisis, it may be that too few are today speaking frankly about where a failure to deal with the aftermath may lead.

In this situation, let me suggest, the country faces an existential threat. Either the legal system must do its work. Or the market system cannot be restored. There must be a thorough, transparent, effective, radical cleaning of the financial sector and also of those public officials who failed the public trust. The financiers must be made to feel, in their bones, the power of the law. And the public, which lives by the law, must see very clearly and unambiguously that this is the case. Thank you.

Posted by Mark Thoma on Wednesday, May 5, 2010

Moopheus:

Finally. I've never ceased to be amazed at the extent to which officialdom has gone to avoid looking at the fraud issue, when it has clearly been a major piece of bubble story. I still won't hold my breath waiting for any kind of substantive investigation, though.

Cnut "Rick" Wixell III, Esq:

Indeed.

There was once an economist who won a Nobel Prize for emphasizing the idea that Capital = Governance Structure, and money values are incidental. Do Nobel Prizes make economists "official" enough anymore? I only wonder, because Jamie and his old man have been pounding away at this message for years, as the academy leadership still fiddles away on metaphysics and recreational math.

And outside the academy, the discussions of "systemic risk" are still being framed in terms of interest rates and accounting identities. The framers inside "officialdom" are afraid of what they will find outside this safe statistical universe, to be sure.

yuan:

"The government already possesses critical documentary trails -- those of AIG, Fannie Mae and Freddie Mac, the Treasury Department and the Federal Reserve. Those documents should be investigated, in full, by competent authority and also released, as appropriate, to the public."

including the fed in that statement took some 'nads.

Calabe Davis:

You know when you flush the toilet and occasionally the **** splashes upward momentarily in the bowl as its going around on its inevitable way down? This will be exactly how the recent "recovery" is going to look in hindsight if this issue isn't adressed.

beezer:

Oh yeah. And give Matt Taibi an FBI badge while they're at it. The kid can smell a skunk a mile away.

alan:

Amen.

I dunno if it was here I found the pointer to William K. Black's story, but it is an eye-opener. Here is his testimony: http://neweconomicperspectives.blogspot.com/2010/04/prof-william-k-black-testimony-on.html

Don the libertarian Democrat:

If you add the Galbraith Testimony to Russ Robert's post...

http://economistsview.typepad.com/economistsview/2010/05/links-for-2010-05-03.html

...you have my view of the two main causes of this crisis. I can't say that we're doing near enough on either front.

On Default/Inflation in the US, I would imagine Default to be the politically easier sell. Especially if you target foreigners, who don't vote. Plus, Us Vs Them is an easier sell as well. In my view, we should just cut expenses and raise taxes. Conceptually, it's not that hard.

alan -> Don the libertarian Democrat...

I like most of Robert's post, except the prescriptions - which suppose an old-fashioned barter world where all transactions happen between members of Mr Roger's neighborhood. But he does describe a leverage cycle in almost exactly the way Minsky describes it.

So the question is: what is the prescription for curing a financial system that has been diagnosed as susceptible to Minsky cycles? The right-wing thinks we need to go back to the 12th century before the Florentines invented banking. We're not going there. But where are we going?

kharris:

Computers do lots of things, but then tend to come down to two things - storing data and doing computations. One thing that Galbraith's testimony highlights is that the massive increase in computer capacity available to financial firms has been used for computational purposes to a far greater extent that for informational purposes.

It is entirely possible to require that mortgage documentation be filled out so as to generate a database entry. There is even reason to think that doing so, while expensive at the outset, would have been a big money-saver for mortgage brokers and mortgage servicers. It's not that this wasn't done, sort of kind of. It just wasn't done in a way that brought actual qualities of individual mortgages and the borrowers they represent into the computation. Failure to do so looks suspiciously like a willingness not to know. Who wants information when you can assume the best?

The point I aim to make is that there is a glaring inconsistency in turning the mortgage business into a great big computation-fest, but leaving the inputs to computation out of the fest. Just digitizing mortgage applications doesn't make those applications true, but it does mean that to the extent mortgage folk required truth, that truth would have gone into mortgage computations. The choice was to do otherwise. Producing a bunch of representations of mortgage calculations which don't actually reflect the underlying mortgages when they so easily could have looks really, really intentional. IBG, YBG.

Lyle -> kharris...

You have captured a key point that is well known in the IT industry, Garbage In, Garbage Out, running something thru a computer does not make it less Garbage.

Secondly the rush for revenues meant that corners were cut because everyone wanted their share, so we have greed, which again regulation tries to tamp down.

Its just like an amendment that won't pass that has been proposed to say that if you are a highly compensated executive or CEO of a company you may not hedge the company stock or buy a CDS on it. (Its sort of like playing a sport and betting against your team, to easy to throw the game).

run75441 -> Lyle...

lyle:

Sorry, that was Oliver Wight of MRP/MRPII vintage who coined the phrase of garbage in and garbage out.

kharris -> Lyle...

Yup. One of Countrywide's big "innovations" was to gut the back room. By lowering processing costs, it put itself in a position to increase market share. To compete with Countrywide, other firms had to cut costs, and it was clear that back room goodness was no longer required, since Countrywide got along without it.

Cost cutting was a big element on the origination end, but or course at the slicing-and-dicing level, the lack of real information on borrowers had other advantages, like allowing the dicers to making up information that fed into better credit ratings for the product.

Chris of Stumptown:

"On Default/Inflation in the US, I would imagine Default to be the politically easier sell"

I disagree. There would be hell to pay when grandma's annuity stops paying because the insurance company is tits up.

Inflation needs the compounding effect before it becomes noticeable and it is IBG,YBG for politicians.

Noni Mausa:

The skunks began their parade decades ago, becoming skunkier and skunkier as they progressed. For me, one major signpost was when several official people (including Maggie Thatcher but many others) said we were entering a new economy, an information economy where boring old things like potatoes and machinery would become marginal elements in an otherwise abstract economic structure made up of ideas and calculations.

Being a woman, I uncharitably thought, "Only men would make up such nonsense." (I was not familiar with Ayn Rand at that time.)

My mental image was of highly skilled theorists discussing this new economy, while unnoticed in the background various people provided for them those marginal elements, cooking potatoes and scrubbing floors.

The abstract segment of all economies rides on the shoulders of the concrete ones. Anyone who says otherwise is either a fool, or has an eye on your potatoes.

Stephen Heyer:

Superb work by James K. Galbraith!

The most important thing, however, is that, like the SEC's civil fraud charges, it renders subjects that had been deliberately presented in a way that put them beyond the comprehension of ordinary people (and most "experts") into terms that are fairly easily grasped by any reasonably intelligent observer.

The surprising thing is that once looked at in these terms, once one refuses to become lost in the maze carefully constructed by the thieves and looters and their hired/bought help, and simply looks at what the financial instruments, deregulation, corporate structures or whatever actually DOES, they turn out to be quite simple – and invariably quite unpleasant.

That's where I think a serious mistake was made in desperately "kicking the can down the road" until after the next election / after the next bit of looting / after the escape hacienda in Uruguay was purchased (a beautiful, safe country by the way). In short, some of those opposing the current vast fraud and looting are learning to explain what is happening in simple terms that ordinary people can grasp.

If a major collapse had happened when it should have, some years ago, it would have all been too hard for the apathetic USA public to understand and they would probably have all suffered the "act of God" silently and "pulled together" with their government and Wall Street. Now, however, if the pain were to become bad enough for them to look up from Oprah there will be plenty of people willing and able to tell them exactly what happened and exactly who did it in terms that they can, with a little effort, understand.

Times could get "interesting" for what is now quite a large, privileged group who have a lot to hide.

Better keep kicking that can!

Stephen Heyer

kharris -> Stephen Heyer...

"...it renders subjects that had been deliberately presented in a way that put them beyond the comprehension of ordinary people (and most "experts") into terms that are fairly easily grasped by any reasonably intelligent observer."

Must be in the Galbraith genes.

Amileoj -> kharris...

Indeed. Their simple willingness (and not so simple ability!) to eschew the conventionally favored obfuscations of the day, to write prose that strives instead for maximum clarity and accuracy, gives to practically every sentence a moral force that the bulk of our public discourse about such matters conspicuously lacks.

don:

"At its heart, therefore, the financial crisis was a breakdown in the rule of law in America."

Note that he is not in the economics department. Nor, with such loosely reasoned arguments, would I ever expect this exalted individual to attain tenure in that department.

The profession has got to stop apologizing to the ill-informed who view forcasting as an important field of economics. Now, as for what has happened to the field of macro-economics, there is much to apologize for, but still no excuse to allow such as Galbraith a speaking role in the debate.

Sufferin' Succotash -> don...

"Note that he is not in the economics department. Nor, with such loosely reasoned arguments, would I ever expect this exalted individual to attain tenure in that department."

So much the worse for the economics department.

Linda R.:

Over and over again, when I express the sentiment that someone needs to go to prison or that restitution is in order, I have been dismissed with talk of complexity, of the systemic nature of the problem, or of politics, or else I am dismissed because I lack the credentials some require for credibility. (It seems to me that a lot of the people with those credentials have been part of the problem, but that's another story.)

Both Galbraith and Bill Black (see: http://neweconomicperspectives.blogspot.com/search/label/William%20K.%20Black) have been speaking truth, using the "F" word (fraud), for a while now. I keep hoping someone will not only hear them, but actually Listen to them - and act. If the Congress and the Justice Department can't (or won't) look for and find fraud, and file charges, then serious reform and regulation are the least that must be done. But there's the rub. The (so far) first failure leads right into what it appears will be the second. I await the final report of the FCIC with at least a smidgeon of hope.

I favor the Brown-Kaufman SAFE Banking Act which would sensibly limit the size of financial institutions. I also agree with Simon Johnson that we have no need for banks larger than $100,000,000,000. Oh, and one more thing... out here in the (formerly, at least) "boring" world, the nature and quality of collateral matters.

"In this situation, let me suggest, the country faces an existential threat. Either the legal system must do its work. Or the market system cannot be restored. There must be a thorough, transparent, effective, radical cleaning of the financial sector and also of those public officials who failed the public trust. The financiers must be made to feel, in their bones, the power of the law. And the public, which lives by the law, must see very clearly and unambiguously that this is the case."

In the face of regulatory capture, the problem grows. The changes needed go beyond rules written down on paper. In order to effect real change, there must be a fundamental change in attitudes, incentives, and ethics. The prevalence and seeming de facto acceptance of sociopathy in the investment banking and political worlds must be dealt a blow. Self-dealing must become difficult and penalties must be swift and strong. Gordon Gecko must die.

K Ackermann:

I agree, Stephen. They sort of blew it in that sense. There is an upper strata, and they collectively have rigged the system to where they can't fail downwards.

Their failure was shouldered by the public without its consent, and is that fair?

We were supposed to go out on a nice date, but instead they slipped us a mickey and raped us.

Now we require justice.

I'll tell you right now, the Fed is probably going to appeal to the Supreme Court to not turn over the crisis documents. If the Supreme court sides with the Fed, then to me, that is the signal that we are on our own, and the union no longer exists. There will be the people, and there will be the enemy.

We paid trillions for the right to see where the money went. If we are not allowed to, well... I'd rather die then live in that country.

They can still fix this. It's up to them.

Sarah:

Great testimony, and I'm especially glad to see him give William Black some of the credit he deserves. I heard him speak at the Economics meetings, where he laid out exactly how the fraudsters went about the business in crystal clear terms. As he pointed out, we need to see a LOT more indictments. Once the prosecutions start and the evidence from the subpoenas starts pouring out that will galvanize public opinion so strongly that the politicians won't be able to wiggle out of finally tackling the reforms we need to prevent this from happening all over again in an even more catastrophic form. As it is all it will take is for a couple of the bigger hedge funds to fail...

Barkley Rosser:

I still maintain that the bubble came first. We have had real estate and lending fraud in place for a long time without a bubble or crisis. There was no increase in fraud at the beginning of the bubble in 1998. That came later with the two feeding mutually into each other. Fraud was/is very important, but not the fundamental. That was the bubble.

I agree with Jamie that Bill Black has been an excellent source of information on the fraud that has occurred.

don -> Barkley Rosser...

Agree. The bubble enabled and amplified opportunities for fraud, but the big damage came from the bubble and the inability of individual entities to account for systemic risk. Fraud may actually have helped, by bringing things to a head earlier before imbalances grew even greater. Just as weak sovereign borrowers may now be helping to limit unsustainable debt growth in stronger sovereign borrowers.

Bruce Wilder -> don...

I can see how changes in interest rates, say, can set in motion the kind of processes detailed by Shiller, and create a bubble, and then the bubble process creates enhanced opportunties for fraud. In that sense, when Barkley says, makes sense to me, as an hypothesis.

What I don't see, is how the bubble can be sustained and magnified to the extent we witnessed without massive fraud and corruption, in the routine processes and procedures of banks in underwriting mortgages and financial securities, which normally would control the flow of funds into these markets.

As Barkley says, fraud and "the bubble" (identified with the psychology of mania?) fed on one another.

The "inability of individual entities to account for systemic risk" just seems like a stilted way to try to rationalize the false intuition of abstract models of markets with complete information. Real markets -- markets, which are organized, social institutions -- don't have, or depend on Supermen, exercising rational foresight and judgment on behalf of unitary firms. Sorry to disappoint. They have bureaucracies, carrying out strategies, policies and procedures.

Where you see failing Supermen, Galbraith and Black, more realistically, see corruption of policy and procedure.

don -> Bruce Wilder...

Part of our difference may lie in definition. Are stated income loans 'fraud'? Where do you draw the line between bubble-induced loose lending standards ('housing can never go down') and fraud?

What percentage of the total market transactions do you think were patently illegal, as opposed to merely foolish (as revealed after the fact)?

I see no supermen in this episode. Certainly not most of the entity heads, who were handsomely overpaid.

I honestly can't believe that fraud was the major cause of the real estate bubble or its collapse. It seems as unlikely to me as believing that Iraq had weapons of mass destruction, or that we are in sustainable recovery. Galbraith offers no statistics to back up his story.

Cnut "Rick" Wixell III, Esq -> don...

"Galbraith offers no statistics to back up his story. "

How can there be statistics about information that, by the nature of fraud, is deliberately hidden or distorted? It's not as though there are no definitions for fraud & misrepresentation in the law.

"It seems as unlikely to me that we are in sustainable recovery."

Don, here you offer no statistics to back up your insinuation.

Cnut "Rick" Wixell III, Esq -> Bruce Wilder...

"Where you see failing Supermen, Galbraith and Black, more realistically, see corruption of policy and procedure."

Second.

That's why they call it fraud.

Though, the "public cause of action" versus the "private cause of action" issue fits that allegory at an institutional scope.

"Ironically, counterreformers use the perverse results arising from their interference as evidence of the failure of the reforms." -- Jan Winiecki

Bruce Wilder -> Barkley Rosser...

I'm not sure what you mean by "the bubble", let alone what you mean by "the fundamental".

The Sandlers at Golden West, Mozilo and Loeb at Countrywide and IndyMac, were right there at "the beginning".

Indeed, if you are Professor Black, and viewing the whole phenomenon from the standpoint that the earlier devastation of the Savings & Loans was a dress rehearsal, I doubt that you would imagine that "the bubble" came "first". I suspect Black sees WaMu and Golden West as surviving contagion from the S&L era, ready to renew the Plague.

Whatever the "psychology" of would-be home buyers, caught up in "the bubble", there still has to be a sufficient flow of funds to drive up prices, and that can only happen on the scale witnessed, by means of a systematic erosion in underwriting standards. And, banking institutions "competing" on the basis of deteriorating underwriting standards have to receive funding.

Even if the "psychology" of the incipient bubble was the initial spark, I don't see how the bubble grows to Himalayan size, without accelerating fraud in underwriting and securitization to supply the necessary funds flow. To me, funds flow is "fundamental", and deserves primacy as identified "cause" in the analysis for two reasons:

1.) only massive deterioration in mortgage underwriting and security underwriting standards (aka fraud) could possibly supply the funds flows necessary to explain the magnitude and geographical scope of the bubble.

2.) regulating underwriting is a feasible target for government intervention.

The second is as important as the former. When we say something is a complex system is a "cause", usually what we mean is that it is a candidate for strategic intervention -- its a variable which policy can control to get a different result.

I'm fairly dubious that a top-level, systemic risk regulator is every going to want to intervene to stop "a bubble" in the making. It is too hard to judge meaning and consequence, let alone to motivate and reward right behavior.

The minutiae of underwriting procedure, however, is a different matter. No "liar's loans" is kind of a no-brainer, as a regulatory standard.

If all the processes for creating and granting a mortgage tie the maximum amount of the mortgage to the verified income and credit quality of the buyer, then housing prices will never vary much from the trend of rents or household income. A change in interest rates, or a local boom, might trigger small blips, but that's all they will ever be. Because the mechanistic processes of underwriting tie house prices and the prices of mortgage-backed securities to household income. And, that's a good thing -- it is what we want a market for houses to do.

Oupoot -> Bruce Wilder...

If I remember correctly, many states did detect the fraud at originating level, but were told by Washington (with WallStreet lobby support??) to stop their investigations &/ prosecutions. If these investigations went ahead, the underlying fraud would have been exposed earlier and should have at least alerted investors (further down the investment chain) that these securities are not as good as they were led to believe. It may not have stopped the bubble from blowing up, but it would have released a lot of the pressure that was building up.

Sarah -> Bruce Wilder...

I agree, and I think it can be seen in earlier, much smaller bubbles in California and elsewhere. In the bubble of the 80's in California, people were getting money from private lenders because banks would not lend in the amounts and on the terms that would sustain a bubble. When the bubble mentality was in full flower lots of people were sucked into lending (especially since interest rates were high, providing a justification beyond the simple assumption that prices would always rise). Ultimately, however, without sources like pension funds and other large institutions the amount available was limited, people began to get nervous and prices plunged back to earth-- without serious damage to the overall financial system, though with plenty of pain for individual homeowners and private lenders.

Lord -> Barkley Rosser...

I agree, but most bubbles pop sooner by cracking down on fraud. In this one fraud was never cracked down on; it was only the exhaustion of borrowers that led this one to pop. This is why cracking down on fraud is so important; it prevents bubbles from becoming as large as this one did.

Cnut "Rick" Wixell III, Esq -> Barkley Rosser...

chicken or egg

irrelevant which came first

Lafayette:

WHEN THE FIT HITS THE SHAN

{Formal analysis tells us that control frauds follow certain patterns. They grow rapidly, reporting high profitability, certified by top accounting firms. They pay exceedingly well. At the same time, they radically lower standards, building new businesses in markets previously considered too risky for honest business.}

Aside from being unethical, the sham is so patently stupid as to be implausible. Unless, of course, by some miracle of Consummate Greed, enough people talk it up and it adopts the industry mantle of "A good idea!" Which is what happened.

Which means that with no foresight and the suspension of any concern for ethical behaviour as well as a serious impetus; we can establish a mindset that (because there is no specific law against the scheme) we can get away with swindling. Try it, see if nobody stops us -- then take the money and run like hell.

And ethics be damned ... besides, who cares? When the fit hits the shan, BigBrother will bail us out!

Worse yet, for the three or four years that the swindle was working, nobody uttered a damning word. A couple of brave souls may have said "it can't last forever", but they were swiftly disregarded. Everybody, including some very intelligent people, thought stupidly that realty prices would keep rising inexorably. So, why worry that a bubble might burst?

America would have innovated, for the first time in the history of mankind, the Asset Bubble that never burst!

Which became Conventional Wisdom ... until the entire edifice came thundering down upon us.

POST SCRIPTUM

Excellent piece, reminding one of a previous Galbraith.

MinnItMan:

Although I agree with the basic point here, I think it's more important to look at how people at every stage of the process got paid, and what types of things most certainly did not pay. Pointing out fraud was always revenue negative, made you part of an investigation where your customers (or bosses) were targets, rarely got take seriously anyway ...

The WaMu story was a petri dish of what happened [nearly] everywhere - compensation was based on bridge-building, not gate-keeping. Another metaphor was given to me once: "we don't cut corners, we run around them." Sure they did.

ken melvin:

John K. was my hero. He has much to be proud of in his sons.

anne:

So that we can separate who is who and what each is about:

http://www.nytimes.com/2009/11/12/world/middleeast/12galbraith.html

November 12, 2009

American Adviser to Kurds Stands to Reap Oil Profits
By JAMES GLANZ and WALTER GIBBS

OSLO - Peter W. Galbraith, an influential former American ambassador, is a powerful voice on Iraq who helped shape the views of policy makers like Joseph R. Biden Jr. and John Kerry. In the summer of 2005, he was also an adviser to the Kurdish regional government as Iraq wrote its Constitution - tough and sensitive talks not least because of issues like how Iraq would divide its vast oil wealth.

Now Mr. Galbraith, 58, son of the renowned economist John Kenneth Galbraith, stands to earn perhaps a hundred million or more dollars as a result of his closeness to the Kurds, his relations with a Norwegian oil company and constitutional provisions he helped the Kurds extract.

In the constitutional negotiations, he helped the Kurds ram through provisions that gave their region - rather than the central Baghdad government - sole authority over many of their internal affairs, including clauses that he maintains will give the Kurds virtually complete control over all new oil finds on their territory.

Mr. Galbraith, widely viewed in Washington as a smart and bold foreign policy expert, has always described himself as an unpaid adviser to the Kurds, although he has spoken in general terms about having business interests in Kurdistan, as the north of Iraq is known.

So it came as a shock to many last month when a group of Norwegian investigative journalists at the newspaper Dagens Naeringsliv began publishing documents linking Mr. Galbraith to a specific Norwegian oil company with major contracts in Iraq....

anne:

http://www.nytimes.com/2010/01/26/world/middleeast/26galbraith.html

January 26, 2010

Oil Company Near Settling Over Contract in Kurdistan
By WALTER GIBBS

OSLO - A Norwegian oil producer announced Monday that it would probably have to pay from $12 million to $144 million in an approaching arbitration settlement with parties identified in legal documents and local media reports as the former American diplomat Peter W. Galbraith and a Yemeni businessman.

Mr. Galbraith, who helped negotiators in the Kurdish regional government figure out how oil revenues are shared under the current Iraqi Constitution, spent part of 2004 as a private dealmaker. He helped bring together the Kurdish government and the Norwegian oil company DNO that year to sign an oilfield exploration and production contract that bypassed the central Iraqi government in Baghdad.

Mr. Galbraith has said that he thought the deal would advance the cause of Kurdish autonomy, which he favored. But it also held the promise of making him wealthy, a prospect reinforced by the announcement in Oslo about the coming settlement....

Eric:

Well if there was systemic fraud, the spoils of the fraud were clearly protected by policies made by both the Bush and Obama administrations. Bush is out of office, but not so our current President. Is Mr. Galbraith calling for his removal from office?

dw -> Eric...

seems like almost of the fraud occurred under the previous administration did it? not much fraud happened starting 2009 now did it? because at that time the fraud had already exploded didn't it? so i guess while we might not agree with all that Obama has done, I am thinking the horse had long since left the gate as far as fraud is concerned. now we might complain that he hasn't moved faster to put more in jail. but this isn't going to be easy

Cnut "Rick" Wixell III, Esq -> Eric...

"the spoils of the fraud were clearly protected by policies made by both the...Obama administration."

Clearly?

Please provide any justification in law or fact for this incredibly ridiculous statement.

Are you implying that the Obama administration is pardoning fraudsters with "policy?"

http://www.mortgagefraudblog.com/index.php/weblog/comments/917/

Do you understand what a bill of attainder is? Are the PUMAs now taking the Joe Lieberman stance that due process is unamerican, provided the accusations are severe enough?

YEESH

anne:

Thus the study of financial fraud received little attention. Practically no research institutes exist; collaboration between economists and criminologists is rare; in the leading departments there are few specialists and very few students.

-- James Galbraith

I would argue that this is not true, as there have been repeated studies on the mortgage abuse of Black homeowners, even a study by Federal Reserve researchers. The problem is that the mortgage abuse of Black homeowners has been of no evident concern to prominent analysts and is not even mentioned by Galbraith. Actually, prominent analysts were praising the mortgage abuse of Black homeowners even in 2007.

anne:

http://krugman.blogs.nytimes.com/2010/05/05/the-way-we-were/

May 5, 2010

The Way We Were
By Paul Krugman

Mike Konczal has an interesting post on how Wall Street and the role of the SEC * were perceived in the late 1970s: back then, the securities abuses of the pre-New-Deal era were viewed as archaic evils, no longer part of the modern world thanks to effective regulation. Today, of course, regulation has been degraded, and the abuses are back in earnest.

Mike's post made me think of another blast from the past, which I uncovered back when Enron and WorldCom were making headlines; the section in Galbraith's New Industrial State (1967) in which he discusses the possibilities of corporate executives using their position to enrich themselves at investors' expense:

"But these are not the sorts of thing that a good company man does; a generally effective code bans such behavior. Group decision-making ensures, moreover, that almost everyone's actions and even thoughts are known to others. This acts to enforce the code and, more than incidentally, a high standard of personal honesty as well … "

The point Mike and I are getting at is that the raw profiteering we now take for granted as an inevitable part of capitalism is actually quite evitable; 40 or so years ago, the system didn't work at all like this.

* http://rortybomb.wordpress.com/2010/05/05/thoughts-on-the-sec-1977-edition/

bakho:

"Obviously, as long as ratings agencies are selling a regulatory license rather than accuracy, you can't expect them to be accurate. And yet the motive for relying on them for regulatory purposes is the presumption that they're accurate. As you can see, there's a problem here."

http://yglesias.thinkprogress.org/archives/2010/05/understanding-the-ratings-agency-cartel.php#comments

Lafayette:

DIRTY TRICKS

{The point Mike and I are getting at is that the raw profiteering we now take for granted as an inevitable part of capitalism is actually quite evitable}

I quite agree ... just put marginal income tax rates back up to 90% above a megabuck or two or three!

The crafty ones will hightail it to Singapore and try their Dirty Tricks, get caught and find themselves in a jail cell ... and the keys thrown away.

Good riddance, I say ...

POST SRCIPTUM

America is bewildered by two opposing principles:
(1) The first is that by (supposed) hard work, smarts and ambition an individual should be justly rewarded -- and the sky's the limit.
(2) That work should be rewarded by immense riches but those who manipulate the system by any combination of widespread predation, fraud or cronyism don't deserve to keep their wealth (if that indeed was the outcome).

Let's make up our minds because those two diametric opposites only lead to confusion, violent dispute and political gridlock.

Fred C. Dobbs:

People who play on Wall Street are expected to understand how to make $$$ whether putting or calling. Fraud? Maybe. Maybe not. Let a judge/jury decide.

(It sure might be fraud if 'the little people',
tinhorns out in the sticks, were hornswoggled &
bamboozled, if a case can be made. Not WB obviously.)

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/7599970/Goldman-Sachs-Fabrice-Tourre-and-the-complex-Abacus-of-toxic-mortgages.html

mark:

I am disgusted at the false statements, insinuation and innuendo of Galbraith's testimony. Most of it is pitched at such a high level of generality it can neither be true nor false, it's just a populist screed. But on the rare instances in which he attempts to identify some specific example, he resorts to cheap tricks that are nothing better than "have you stopped beating your wife yet?" Let's take a look:


Galbraith: "Did Fannie Mae and Freddie Mac appreciate the poor quality of the RMBS they were acquiring? Did they do so under pressure from Mr. Henry Paulson? If so, did Secretary Paulson know? And if he did, why did he act as he did?"

Paulson became Secretary of the Treasury in July 2006. Long before then, Fannie Mae and Freddie Mac had been the dominant purchaser of subprime mortgages. Don't take my word for it -- Mark Thoma linked in a 10/21/08 post [http://economistsview.typepad.com/economistsview/2008/10/what-didnt-caus.html] to an Econbrowser article by Melanie Chinn that says: "Between 2004 and 2006, when subprime lending was exploding, Fannie and Freddie went from holding a high of 48 percent of the subprime loans that were sold into the secondary market to holding about 24 percent, according to data from Inside Mortgage Finance, a specialty publication." Galbraith's use of unanswered rhetorical questions to insinuate personal misconduct is despicable. It's the lowest form of debate. It's McCarthy-like.

Another example:

" did AIG knowingly issue CDS against instruments that Goldman had designed on behalf of Mr. John Paulson to fail? If so, why?"

Same tactic - unanswered rhetorical questions insinuating fraud, and he adds to it the same "have you stopped beating your wife" tactic -- there is no "AIG backed transaction" that "Goldman designed on behalf of Mr John Paulson". The ABACUS transaction in the SEC suit involved a different company named ACA - to whom, the SEC complaint makes clear, Goldman disclosed Paulson's short positions at the outset of structuring the transaction. How shameful to resort to such cheap rhetorical tricks to disseminate falsehoods.

Another example.

Galbraith: "Those records, if examined, would reveal the extent of missing documentation, of abusive practices, and of fraud. So far, we have only very limited evidence on this, notably a 2007 Fitch Ratings study of a very small sample of highly-rated RMBS, which found "fraud, abuse or missing documentation in virtually every file."

Does he tell anyone how much was fraud and how much was missing documentation? No. He just treats it all as fraud. What is the missing documentation? Is it important - like the mortgage? Or is it unimportant or documentation that was allowed to be missing, like income verification for certain subprime loans. No detail, just conclusions. And what exactly is "abuse" in the context of RMBS? Does someone whip the little pieces of paper or crumple the file folders viciously? This is just rhetorical hysteria passed off as academic insight.

Cnut "Rick" Wixell III, Esq -> mark...

"How shameful to resort to such cheap rhetorical tricks to disseminate falsehoods."

Good thing he wasn't charging millions in fees in exchange for it.

"there is no "AIG backed transaction" that "Goldman designed on behalf of Mr John Paulson"

Well, if a tree falls in the woods and mark's not there to hear it, did it happen? Goldman as a firm bought protection from AIG as a matter of regular course. Is this not true?

http://www.ft.com/cms/s/0/db7dc52a-4bee-11df-a217-00144feab49a.html

If the business partner of AIG -- a company with a stinking history of fraud investigations -- just got sued for going around soliciting undisclosed information from a short artist, you think a few follow-up questions about past dealings would just be rhetorical? You must not know much of what the SEC Enforcement Division is capable of.

"Long before [Henry Paulson's appointment], Fannie Mae and Freddie Mac had been the dominant purchaser of subprime mortgages."

Wow. You missed the whole point of that link. Fannie and Freddie's MARKET SHARE was rapidly DECREASING to private institutions. Just so you don't miss it, I put those words in all-caps for emphasis. They bought and bought, and still couldn't keep up.

And really, you think the Paulson-FannieFreddie remark is some kind of eccentric gaffe with no basis in the record? Goldman has traded actively with F&F before & after Henry bailed them out, no? I say this even as the point here should be to illustrate moral hazard & reg capture in general than Paulson per se.

"Does he tell anyone how much was fraud and how much was missing documentation?"

Why should he? He is reporting a Fitch finding on a particular incident. The whole point is that there is not enough information to measure systemically.

And as for the broad presumption of fraud as a systemic phenomenon that actually exists, maybe you could spend a few months reading through the archives on this random link and recalibrate your "hysteria" perception.

http://www.mortgagefraudblog.com/

Most people who actually know something about the big picture it would not call these remarks hysterical.

mark, Jamie Galbraith is an economist, so it's not like the standard of accuracy is high to begin with. And as you know, inaccuracy alone is not sufficient to presume bad faith. Galbraith may be homely, belligerent, and cover'd in fleas, but who else in the profession is willing to rattle this cage when it comes to the systemic question. The reason people commit fraud in the first place is because, generally, they're badder than you.

Though after all this I will concede, if any of Galbraith's representations truly be misinformation, I'm glad you had the nerve to blow the whistle here, where praise certainly outweighs the criticism.

Caleb Azariah-Kiros:

Strangely Galbbrith did not mention anything about the Shadow banking system the root cause of the financial meltdown.

Cnut "Rick" Wixell III, Esq:

"I honestly can't believe that fraud was the major cause of the real estate bubble or its collapse. It seems as unlikely to me as believing that Iraq had weapons of mass destruction"

What irony. Is it intentional?

http://www.seattlepi.com/local/333503_fbi28.html

http://www.realestatechannel.com/us-markets/residential-real-estate-1/real-estate-news-mortgage-fraud-countrywide-new-century-mortgage-afg-financial-robert-morganthau-fitch-ratings-new-york-daily-news-huffington-post-2433.php

So, don, are more tenured employees willing to courageously assert "What problem! I don't see a problem!" in new and innovative styles, what economics departments need right now?

Rom:

This was said and written here a while ago:

http://blogich.com/2009/02/27/manifesto-1-for-maximum-value-creation-we-need-values/

[Dec 29, 2009] "2010 Foreseeable and Unforeseeable Risks ~ The Room For Policy Error is Enormous"

Dec 29, 2009 | nakedcapitalism.com
  • sharonsj says:

    December 29, 2009 at 12:33 pm

    I doubt OPEC gives a rat's ass about the Israeli/Palestinian conflict. OPEC only does what's good for OPEC. And the price of oil often depends on speculators.

    Many banks are in terrible shape, but we don't know how bad because they are still doing funny accounting. But the ARM reset, along with tanking commercial property, will be another blow.

    As for the states, they are sinking too. If they keep raising school and property taxes to save their asses, you'll be seeing armed homeowners next.

    Reply
    • Doug Terpstra says:

      December 29, 2009 at 1:22 pm

      OPEC's 1973 oil embargo, with devastating impact on the global economy was a direct response to the wars of 1967 and Yom Kippur-clear blowback for US support of Israel's expansion and occupation of Palestine. Though inconvenient history, that wellspring of Arab rage as much as Vietnam caused the last Great Recession. In the maddening absence of any peace process a repeat of that and another 9/11 is very likely-hence our increasingly entrenched militarism in the region-and the insane push for expanding war to Iran, Yemen, Syria, etc.

      Reply
    • Ted K says:

      December 29, 2009 at 1:23 pm

      Adjustable rate mortgages are the biggest scam that's been sold to the middle class over the last century. 95% of the time ARMs favor bankers, and anyone who doesn't realize that hasn't got a basic education in finance. Nobody writes terms and works double time to sell and market those terms (ARMs) unless they benefit from it. Least of all the banks.

      And anyone who cares to disagree with me please do: It will be proof of your current employment at a financial institution or that you never took finance 101 in University. Just please let us know which.

      Reply
  • Hugh says:

    December 29, 2009 at 2:08 pm

    This is a good synopsis of the financial situation. We have a pig (the deteriorating fundamentals) and lipstick (bubbles in stocks and commodities and happy talk emanating from the likes of Tim Geithner).

    I would just add to his list the continuing drag on the economy of high unemployment and high debt loads. Uncontrolled healthcare costs will be unaffected too by any of the current healthcare bills. The 2010 elections will also change the political calculus, making reasonable reform even less likely. Foreclosures are touched on in the entry on GSEs but a real wild card remains the legal ramifications of the MERS and other related messes.

    Reply
  • Harminder says:

    December 29, 2009 at 3:30 pm

    the attempted Christmas Day bombing and the expansion of Al Qaeda (Pakistan –> Afghanistan –> Pakistan –> Somalia –> Yemen –> ??) is a reminder that, even as the US/EU economies struggle, they will be stuck with high defense & security expenditure.. no chance to get any savings from ending the war in Iraq (swords into ploughshares etc)… while China, India, & South East Asia move along with the free trade agreements and managed peace, and no responsibility for bearing any of the burdens of global security…

    as long as Israel does not settle with Palestine, the US will be stuck bearing the cost of this conflict, and none of the benefits (if there are any, other than the existential gain of being in one's historical homeland)…

    I think this security burden will, in the longer run, have a much larger impact on future growth than economic/banking reform… that might just be the neo-con victory at last…

    Reply
  • mario margiocco says:

    December 29, 2009 at 4:08 pm

    Dear Mr. Bougearel,
    I think you insist too much on the Emu forthcoming problems. There will be, already there are problems, and Italy might have to struggle to keep its creditworthiness.
    But, first, your list in my opinion should be inverted, in the sense that Greece is already in trouble, Spain might come next, Italy third. Do not look only at public debt, look also at private debt and foreign debt.
    You see, on the western side of the Atlantic the only top person who has always been in favor of Emu and the euro has been Paul Volcker. Plus several academic economists, not many, and very few politicians. The euro had to fail. It seems to me that there is a scent of this in your analysis. We shall see.
    Now, some reflection. Given the fact that the U.S. economy is muuuch bigger and muuuuuch better than the Italian one, given the fact that if I had the choice to invest I would always prefer the U.S., not ignoring Italy nonetheless, given everything you want, do you know that if you take into account the U.S. gross public debt as you should and not only the debt held by the public, and if you rightly add to that the shaky assets of Fannie and Freddie covered by full federal guarantee since september 2008 and even more so since December 24 2009, do you know that if you do all this adding you reach a debt/gdp ratio for the U. S. higher – even now – than the Italian one?

    Thank you for your attention, and best wishes for 2010

    Mario

    Reply
  • kevinearick says:

    December 29, 2009 at 4:23 pm

    Back in the 70s, labor and capital had a row. Labor was reorganizing to accommodate demographic deceleration into equilibrium, and capital chose to replace all the labor superintendents with its own corporate people, to avoid losing the ability to pull revenue forward from the future.

    If you look, you will see that its superintendents have become increasingly corrupted by the process over time, accepting more and more money, other people's debt, to liquidate the middle class, a capacitor that was built up over several thousand years of evolution. In a mere 35 years, they have liquidated the mechanism. Capital shorted its own future.

    Labor does not work for capital; they are countervailing powers. To the extent they compliment each other, a semi-neutral middle class grows between them. There is currently no agreement between them because capital shorted the constitution on a handful of votes in the Supreme Court to implement family law, with the intent of breeding weaker counter-parties to replace labor.

    Labor simply continued to move forward, as it always has under such circumstances, because it is subject to evolutionary pressure to do so, a condition capital doesn't have to deal with until it discharges. The AFL-CIO is not labor. Take a look at its collection of non-performing capital; it has no understanding of physics.

    Now, 35 years later, the global economy must still be reorganized from the bottom up to accommodate demographic deceleration into equilibrium. Municipalities will continue to fall off the cliff of collapsing tax receipts until they adapt, through purely municipal interest law. The nation/state nexus is simply too tightly bound to initiate effective change; without space to disassemble and reorganize, it is imploding of its own gravity.

    The Internet is a temporarily useful crutch. Look around, where you are and in your travels. The reported numbers are meaningless; they are all designed to support demographic acceleration, an invalid objective.

    We will get this show on the road when capital minds its own knitting, efficient allocation. Labor supervises labor because evolution requires labor to be effective, to grow the middle class. Talent will not tolerate stupidity, willful ignorance.

    Example:

    I was working with a union kid in his 20s, who was getting six figures to fix elevators. He bypassed all the safeties on an escalator, and shorted out the main circuit board 3 times. Finally, he threw a temper tantrum, in the middle of a mall during business hours, and beat up that circuit board with a sledgehammer. I quit when the union refused to correct the situation. Recently, a child lost his finger on that escalator.

    I don't blame the kid. He's working on efficient automation equipment designed to replace him, denied an education by the union filter, and his government certification makes him responsible for outcomes. Of course he's imbalanced; that is the objective of corporate control, private profit at public cost.

    That kid is still "fixing" elevators, "earning" six figures, while many much more talented people are laid off from $10/hr jobs. The economy in a nutshell, all across the globe. The nation/states are simply playing musical chairs with the exploding debt.

    Reply
    • kevinearick says:

      December 29, 2009 at 5:36 pm

      Acquaintances disassembled American plants and reassembled them in China, only to be surprised with termination upon completion of the task. Now, capital is gearing up to move plants from China to Africa. The circuit ends where it began. Surprise, surprise.

      Left to its own dc devices, capital will short circuit itself every time.

      Unforeseeable? Only to those with no experience in punchbowl economics.

      Reply
  • Ignacio says:

    December 29, 2009 at 5:30 pm

    It is strange when writing about global risks you focus exclusively in the euro area, and particularly in what you call the PIIGS (not very elegant indeed). Didn't you know that fiscal deficit in 2009 will be in France as large as in Spain in relative terms? What about the UK? They are the champions of fiscal deficit.

    Your "global risks" insights look very much like the typical europhobic english approach.

    Reply
  • jdmckay says:

    December 29, 2009 at 6:19 pm

    Good article, not so sure I agree w/your EU scenarios… very highly speculative IMO. Your bullet point 19:

    19. Italy is expected to be the first country that will first kiss the EMU good riddance.

    Who, precisely, is doing this expecting? Italy needs EU right now a lot more than EU needs Italy.

    you point

    13. The solidification of the countries in the EMU may break-up like ice sheets in the Artic tundra as the global financial meltdown puts further stress on the EMU. Incentives to remain in the EMU, for many EU countries it might be better to leave the EMU than stick around for its constraints and austerity measures

    First one ("break-up like ice sheets")… I dun'o, think you could be more specific? As several others have mentioned here, long history on this side of the pond "shorting the Euro" in error. There's reasons EURO is up +/-50% against the USD in this decade.

    As for "better to leave", seems strange comment as well: the lack of "austerity" measures are means by which US has "swept things under the rug", as you describe in first part of your article (which I agree w/completely). Seems to me EU's push for belt-tightening (and restrictions on finance "innovation") are in their favor, not to their detriment.

    Reply
  • NC Jim says:

    December 29, 2009 at 6:35 pm

    When Brad Setzer was at the RGE Monitor he tried to estimate purchases of Treasuries/Agencies by ME oil countries in the London markets in order to "launder" government purchases into private ones. I wonder if this could be the source of the phantom "household" purchases. If so, they could indeed continue if the oil price stays reasonably high.

    Jim

    Reply
    • Doug Terpstra says:

      December 29, 2009 at 6:47 pm

      Speaking of 'laundering', maybe narcotraffickers are the 'households' buying US treasuries. This includes Afghanistan, which (with the CIA?) now produces roughly 90% of the world's heroin-a new growth shadow stat.

      Reply
  • Doug Terpstra says:

    December 29, 2009 at 7:05 pm

    This is a terrific (and terrifying) article. Could it be the globalized collapse in OTC Debt and Derivatives that has panicked Geithner into stammering such dubious assurances? It is very likely that China and other foreign creditors may really be holding the reins, not Timmy. Just sayin'.

    Mr. Bougearel illustrates a kleptocracy with stark clarity. He notes that, unlike Geithner and Bernanke, FDR followed a traditional remedy in lending "freely and early, to solvent firms, against good collateral, and at high rates" while letting bad banks fail. But it is critical to note that FDR-in addition to such supply-side infusions-also made highly-productive demand-side investments in roads, schools, libraries, lodges bridges, dams, utilities, etc, many of them priceless cultural and economic treasures-still paying enormous dividends today. Summers and Geithner, unfortunately, seem too mired in blind neo-liberal Rubinomics to feign more than token stimulus for Main Street-IMO, misfeasance and/or crimes of tragic dimensions.

    There are no brakes to this kleptocracy, save the laws of physics-gravity and thermodynamics. Mr. Bougearel's ecological model for the global economy helps a layman to visualize the parallel dynamics of financial and natural system sustainability-in this case how self-reinforcing 'positive' feedback loops in either sphere can potentially trigger an accelerating cascade of forces that overwhelm systemic carrying capacity rapidly (a tipping point conceivably beyond even Mr. Geithner's herculean abilities, even after corporatizing Social Security). Particularly ominous here is the prospect of both planetary systems, natural and economic, converging in roughly synchronous collapse, with arguably apocalyptic global impacts, physical and geopolitical. Add in the possible exhaustion of 'peak oil' and James Howard Kunstler's 'Long Emergency' and 'A World Made by Hand' may be upon us soon. Thus, the reference to the Mayan calendar seems not so fantastic.

    shrek

    December 29, 2009 at 8:32 pm

    Excellent article. I tell all my young friends that no one should be worried about investing at all right now. The number one thing is to get out of debt and have 90 percent of net worth in cash. At some point the system is going to go kaput and the global economy is going to implode.

    How geithner thinks we are going to avoid this without getting rid of too big to fail, dangerous derivatives, and the huge amount of liabilities is totally laughable.

    The intellectual elite in this country are totally brain-dead. They are even worse than the bankers.

  • [Oct 21, 2009] PrudentBear by Peter Souleles

    October 21, 2009

    I used to think that "civilized society" was defined as people collaborating and in the process of doing so, providing each other with goods and services, mostly for reward but at times – either through taxation or volunteerism – for free to those less fortunate. In the process of this collaborative exchange, man was supposed to become more enlightened, thus ensuring optimum outcomes could be secured with fewer natural resources and less labor, abetted by invention, cooperation and innovation. Each generation was to leave behind a legacy of capital formation (roads, bridges, schools, etc.) as well as an intellectual legacy in the arts and technology.

    Over time, a compounding of these positive developments would endow each successive generation with a higher standard of living, without the good earth being gutted and polluted beyond recognition.

    But something, unfortunately, has gone wrong, and it may possibly become far worse than we can imagine. What has been the source of this failure to compound progress?

    The answer is theft. Earthquakes, tsunamis and other such natural phenomena, as well as diseases, are of miniscule consequence compared to theft. Theft throughout history has manifested itself in the same forms again and again and each time it has resulted in resources either being destroyed or re-distributed in the process.

    It is my thesis, in this brief essay, that theft is supplanting value in both the medium of exchange as well as in the exchange itself. Theft has become the manifestation of greed and moves in when the conscience moves out. As a result, we are faced with the phenomenon of cascading theft – that is, theft that leads to more theft. In the end, the concept of "value added" is transformed increasingly into "value lost."

    War

    War, which has often been described as organized theft, most probably occupies equal top spot in the rankings. History has repeatedly cast conquerors as liberators who bring some form of democracy/freedom to the downtrodden, when in fact a closer examination shows that the conqueror either carts off the spoils and/or leaves behind a corrupt and compliant democracy or dictator that allocates favorable concessions to the bankers and capitalists of the conqueror.

    War not only vanquishes the loser, but also has the effect of weakening the ally. A study of how a financially cash-strapped Great Britain was made redundant as an Empire is fascinating as it is telling about who your friends are. According to a recent article by economist and historian Zachary Karabell, Great Britain in 1946 asked for a loan of $5 billion at zero percent interest for 50 years. What she got was a $3.7 billion loan and a set of conditions which effectively installed the United States and the U.S. dollar as the linchpins of power and finance. As someone once cleverly quipped, "I want to thank the U.S.A. for coming to our assistance in 1941 when we really needed them in 1939."

    To maintain its Empire, the U.S.A. has installed bases all over the world. According to Hugh Gusterson, professor of Anthropology at George Mason University, the United States has over 1,000 bases worldwide which constitute 95% of all foreign bases in the world. So we have the U.S. citizenry largely footing the bill for human and material resources so that major corporations can extract "profit" which is often not even taxed in the U.S.A. Can anyone estimate what those resources would have yielded the American people had they been deployed in the U.S.A? Moreover, has there ever been an instance in history where a nation has spent so much to make so many enemies? Perhaps it was only a coincidence that the United States invaded Iraq a few months after it announced that it would refuse U.S. dollars for the sale of its oil. It is clear here that business must be protected against "unreasonable" foreigners.

    Unfortunately, the matter does not stop there and as part of the cascading effect, additional theft is warranted through the implementation of the Department of Homeland Security and other such measures.

    The Banking System

    The banking system, which is war's grotesque Siamese twin, is the greenhouse, factory and laboratory of every paper alchemy known and unknown to man. Is there any wonder that this is the case? A recent Wall Street Journal report stated that Wall Street firms would be paying out $140 billion in bonuses this year as opposed to $130 billion a year before the meltdown. Amounts of this size are neither payment nor reward; they are bribes to buy the intellect of America's best without the inhibition of conscience. At least New York might be saved by the infusion of these bonuses.

    The credit creation system, which is the heart of banking, is by all accounts nothing more than a debt pyramid that, in combination with opportunistic mortgage brokers, accommodating government-sponsored enterprises (GSEs), clever bankers and gullible investors, gave rise to an unprecedented orgy of buying, speculation and manipulation. Manufactured income details and low upfront interest rates gave the perpetrators of this theft the means to initially create dreams for the clueless home buyers – and to subsequently substitute those dreams with nightmares.

    The cascading effect of this theft has led not only to loss of homes, but also bankruptcy, loss of jobs, breakdown of families and the gutting of so many industries that sprung up in the wake of a building boom struggling to keep up with demand. The game was good while it lasted, but the day arrived when even the banks were brought to the brink as a result of losses being generated by the subprime fiasco. This was no doubt greatly complicated by derivatives, which still remain more deadly than the unaccounted for nuclear-bomb briefcases of the USSR.

    It is no secret that the Federal Reserve has more or less provided astronomical amounts at a virtually zero rate of interest to a raft of top banks in an attempt to counter horrendous losses, and to therefore save them from annihilation. Has the Fed's largesse flowed to the struggling home owner? According to a recent Bloomberg News report, a total of 937,840 homes received a default or auction notice or were repossessed by banks, which represented a 23% increase from a year earlier. So there is your answer.

    Fear not, as not all is lost. Goldman Sachs reported a $3 billion profit in three months just days ago. Is this a sign of recovery or massaging the truth? I am afraid to say the latter after reading various commentators and in particular the piece by Dylan Ratigan in the Huffington Post. Some $64 billion received through the Trouble Asset Relief Program (TRAP), AIG, the Fed and the FDIC was exponentially leveraged to buy distressed assets, which has led to their reflation.

    The taxpayers, of course, have received precious little in return but the politicians did better. According to the Center for Responsive Politics, major banks and financial institutions in receipt of $295 billion in TARP money reciprocated with $114 million to Washington for lobbying and campaign contributions. As Andrew Cockburn puts it, "at 258,449 percent, it has been called the single best investment in history."

    The mutually parasitic relationship goes further, in that the major banks are also keen buyers of U.S. Treasurys sold at auction. And what they cannot lend out, they ysts and commentators will scratch their heads in disbelief at this fiasco which is so brazen that it defies any modicum of common sense.

    Whether the assistance afforded by the Fed to banks can outrun the pace of foreclosures and rising unemployment remains to be seen, although the signs are not encouraging. Either the unfolding internal collapse or the external refusal to continue funding the United States while its dollar slides will inevitably bring on a resolution unlikely to be palatable to anyone. In the meantime, depositors are subjected to laughable rates of interest on their savings as well as the ignominy and insult of potentially having their bank closed by the FDIC on a Friday afternoon.

    Government

    If war and banking are the terrible Siamese twins then surely government is the mother of these two creatures. Whilst I do not consider myself to be a member of some lunatic fringe advocating the dismantling of government, I nevertheless consider most of its activities to be wasteful and many without purpose and therefore a form of theft. (Here the astute reader will correctly point out that war is their doing also).

    Do I need to remind readers that Social Security contributions disappear into the unified budget and replaced with increasingly worthless IOU's in the forms of government securities? Through inflation, their value diminishes until retirement resembles imprisonment. Government will either tax or borrow in increasingly larger vicious circles to both placate the masses but also to cement its position and authority. As the vicious circle grows, so does the amount "skimmed" by corporate America which provides the bulk of the services. Where otherwise would the Halliburtons of this world be without Uncle Sam's generosity?

    Consumption

    The final member in the quadriga of theft belongs to consumption. No doubt the Renaissance and the Industrial Revolution transformed the world of consumption, but it has been in the last couple of decades that consumption took on a hideous conspicuousness that has in its own right threatened the viability and stability of the system. Whereas only the rich in previous generations could flaunt their "toys," in the world of today, anyone armed with a credit card could create a veneer of affluence. As Warren Buffet once exclaimed, "price is what you pay, value is what you get." It is clear that whilst price and value are rarely identical, nevertheless the hiatus between the two has never been so disturbingly wide.

    Housing values up to the time of the bust were the major but not the only example of this rift. No doubt the siren call of easy credit and the interest-ree loans of retailers also proved extremely powerful and effective. The reality is that the real wages of Americans had not increased since the 1970s, and in an effort to keep the lid on their wage demands and propensity to strike, credit became a common currency. The ability to borrow not only gave the masses the ability to buy, but also blurred the distinction between needs and wants. Consumption was fast-tracked well beyond the normal trajectory of the economy to the point that it now constitutes some 70% of U.S. Gross Domestic Product (GDP).

    To repeat an earlier point in a different manner, the price of a need more closely tracks value than what the price of a want does. When wants are satisfied in increasing measures, another cascading sequence of "thefts" occurs. A simple example would be the consumption of high-sugar carbonated drinks and fatty foods, which are simply wants. The effects are well documented and the results highly visible when one looks at the youth of America as it claims close to top spot (if not top spot) on the obesity charts. The effects of such over consumption on their health and by extension on the health system cannot be overestimated. Nor can the effect on their education, employment, income earning capacity, relationships and mental well being be discounted.

    Possible Solutions

    Between wars, the banking system, government and consumption, one can safely say that the four have combined to bring a great nation to its knee. Should the United States go down on both knees, the ramifications for world prosperity and peace will be greatly jeopardized. The United States has but little time and very few options to counter the present descent in its economy. Creative destruction has largely been thwarted by the interference of government in banking and the car industry, as well as by providing stimulus checks. It may well be that the White House has a chaotic solution in mind should it be faced with doomsday economic scenarios. The reasoning may be that if you cannot get back on top of your affairs, then at least cause as much chaos to your rivals as is possible, to even out the net result. No doubt the U.S. dollar could become a refuge by default.

    In my view, the United States can reclaim the high ground in five ways. Whilst its capitalist system has been abused beyond comprehension, it is nevertheless a far better foundation than any communist or socialist system that relies on squeezing and restricting its citizens. In brief the five approaches are as follows:

    In conclusion, it should be noted that entrenched structures, force of habit, vested interests and a population that has led the high life on debt for too long, make any changes highly difficult. All hope, however, must be kept alive through strategies that can be followed step by step and brick by brick. Failure is not an option, because if compounding misery gets the upper hand, the nation will break apart. Value must be reinstated in transactions if value added is to return to the system. Progress is predicated on value added rather than value lost, and no amount of alchemy, printing, legislation or oratory will ever be able to reverse or supplant that truth.

    Peter Souleles, an economics and law graduate, ran a private accounting practice in Sydney, Australia, until retiring in 2000.

    Kregel-Parenteau No Sidestepping the Eurozone Implosion

    Wolf packs of financial speculators cicling around...
    05/17/2010 | naked capitalism

    By Jan Kregel, former professor of economics at Università degli Studi di Bologna and Johns Hopkins,m and currently a senior scholar at The Levy Economics Institute and Rob Parenteau, CFA, sole proprietor of MacroStrategy Edge, editor of The Richebacher Letter, and a research associate of The Levy Economics Institute

    A week ago eurocrats launched their campaign of overwhelming force designed to shock and awe the "wolf pack" of professional speculators and institutional investors (hedge funds and pension fund managers) into a more docile, subservient position. In the currency market, the shock and awe wore off after the first 48 hours, while by the end of the week, it also appeared to be wearing off from the equity markets.

    Some of this is undoubtedly just the innate brazenness of the wolf pack being expressed. As a general rule, they do not take kindly to being cowed or constrained in any fashion. It is simply is not in their genetic make up. Consequently, they have no choice but to follow their instincts to call the bluff of the eurocrats, and that is part of the reason we are seeing, for example, the wolf pack dragging the euro exchange rate down to the ground in recent trading sessions.

    But this is about more than just testosterone counts. Some wing of the professional investing world is beginning to see the design flaws built into the eurozone from day one. And once they spy these flaws, they begin to realize the nature of the solution is something utterly different than what they are witnessing being rolled out before their very eyes. In the following 11 points, we highlight some of the key aspects of the eurozone predicament using the financial balance approach developed by the late Wynne Godley which we have explored in previous blog submissions, papers, and book chapters. Until more investors and policy makers can understand the true nature of the various predicaments facing the eurozone, and the inherent design flaws exhibited in the European Monetary Union and the (In)Stability and (Lack of) Growth Pact, odds are precious time will simply be wasted trying to make believe the shock and awe fix is already in.

    1. Underlying the eurozone predicament is a missing adjustment mechanism. There is neither a price nor a policy mechanism that encourages the current account surplus nations to recycle their surpluses in a win/win, pro-growth fashion. Keynes tried to design such a mechanism into the Bretton Woods agreement, but the American negotiators scotched it. This same pro-growth adjustment mechanism is missing at the global level with regard to China (although they did report a trade deficit in March).

    2. An ostensibly moral stance advocating balanced government budgets is revealing a profound ignorance of the simple accounting of sector financial balances. Those preferring to impose a "fiscally correct" policy on the peripheral nations should best recognize these accounting realities, and soon. If we are correct that domestic income deflation will be the end result of fiscal retrenchment colliding with private sector attempts to net save, then surely more desperate citizens will turn to even more desperate acts. Rather perversely, the combined effects of fiscal retrenchment, private income deflation, and rising private debt distress are likely to make moral considerations a second or third order concern for many eurozone citizens.

    3. Ultimately, current account surpluses need to be recycled into chronic deficit nations in a sustainable fashion. Such a mechanism could be set up under the auspices of the European Investment Bank very quickly. Effective incentives to recycle current account surpluses via foreign direct investment or equity flows should be crafted at once.

    4. Such an approach is likely to prove superior to funneling financial assistance through the IMF or other multinational arrangements. The IMF will undoubtedly insure that fiscal retrenchment gets imposed across the region. Any fiscal assistance is likely to be imposed with conditionality – a conditionality that fails to recognize sector financial balances are interlinked, both within and between nations. IMF conditionality is bound to set off the twin contagion vectors of falling trade surpluses and rising bank loan losses in the core nations. Surely this is not what Dutch and German policymakers intended, nor is it any way to hold the eurozone together.

    5. Rapidly cutting fiscal deficits without considering the impact of such moves on private sector financial balances is a shortsighted, if not dangerous policy direction. Sector financial balances – the difference between saving and investment, or income and expenditures – are interconnected, and cannot be treated in isolation.

    6. Hiking taxes and slashing government expenditures will suck cash flow out of the private sectors of the peripheral eurozone nations. These private sectors have been rebuilding their net saving positions in the wake of sharp and prolonged recessions. Companies have been conserving cash by slicing investment spending, inventories, and employment. Households have already drastically reduced home purchases and consumer spending.

    7. It is an elementary fact of accounting that the private sector as a whole can only spend less than it earns if some other sector spends more than it earns. That sector has tended to be the government, usually as automatic stabilizers kicked in while recessions deepened. Indeed, most of the dramatic widening of government deficits is due to a collapse in tax revenues, not to discretionary stimulus. Pursuing fiscal retrenchment in order to reduce government debt default risk will merely raise the odds of private sector debt defaults. Cash flow will be taken from households and firms attempting to rebuild their net saving positions, and private debt servicing will falter.

    8. The only way to avoid this outcome is if the nations undertaking fiscal retrenchment can swing their trade deficits around in a fully offsetting fashion. Otherwise, domestic income deflation is the likely result, Indeed, this is the madness behind the method of "internal devaluation" so evident in Latvia's economic implosion. There is no guarantee that trade swings will be large enough to overcome fiscal drag. A return to debt deflation dynamics like those engaged after the Lehman debacle is not out of the question.

    9. Furthermore, since the current account surplus of the eurozone has remained between +1 and -1 percent of GDP for quite some time, there is every reason to believe that attempts by the periphery to achieve trade surpluses will undermine the export led growth of Germany and the Netherlands.

    10. It would therefore appear that fiscal retrenchment is about to set off two related contagion effects. First, the loans on the books of German, Dutch and French banks are likely to sour as private sector cash flows are squeezed in the periphery. Bank holdings of government debt issued by the periphery may not default, but the mortgages and corporate loans these banks have outstanding to the periphery will experience rising loan losses.

    11. Second, the export sales of German and Dutch companies will fade with the falling import demand of the periphery. As their domestic incomes fall, they will import less. In other words, the fiscal retrenchment the core nations are insisting upon is highly likely to boomerang right back on them.

    As it stands, investors have started to recognize that bank in the region are at risk. CDS for Spanish and Portuguese debt have started to widen more dramatically over the past two weeks, although investors still appear overly focused on government debt CDS. Policy makers have also begun to realize Greece is unlikely to be the last country requiring a bail out, while they at the same time sign on for rapid fiscal "consolidation" (read retrenchment) in order to ostensibly avoid becoming the next Greece.

    Yet we continue to find many of the points detailed above are not yet recognized by professional investors or policy decision makers. Absent this coherent framework, it will indeed prove very difficult to sidestep an economic and financial implosion in the eurozone, following on the heels of an already historically deep recession, and burst property bubbles in a number of eurozone nations. May wiser heads prevail.

    Kevin de Bruxelles says:

    4:28 am
    I'm not even an economist but it seems obvious that the mistake you are making is to see the Eurozone as an isolated unit instead of an economic entity that exists within a global system. From the global system point of view it is obvious that most of Europe's' recent problems will be resolved as the Euro declines in value. The one main exception is the problem of economic and political integration at the EU level which seems to be moving forward but which paradoxically gets more impetus as the crisis continues. In other words in order to profit from the crisis they have to push the speed of this integration before the falling Euro ends the crisis for Europe.

    As the Euro declines, the current account deficits will become surpluses in the southern countries, with the exception of Greece. The Greek economic model, which by the way is very similar the the American one, is unsustainable within the European context and must be brought into balance. But luckily it is small enough to be dealt with. Even progress is being made there on reducing military spending if we are to believe the rhetoric coming out of the latest Greek – Turkish summit.

    And so as the price of Chinese, Japanese, and American goods and services rise, Europeans will switch to buying European goods. So Germany and The Netherlands will not only be increasing their exports outside the Eurozone but the losses brought on by public fiscal retrenchment will more than be made up for by the increase in demand for European products. In other words the deflationary effects of the decrease in government spending will be matched by the increase in manufacturing brought on by the decline in the euro's value – both in terms of exporting more out of the Eurozone and switching from imported goods to European manufactured goods within the Eurozone.

    Yes energy costs will rise as the Euro falls but European energy policies are well designed to deal with this problem. The taxes make up a large percentage of most of the cost of many forms of energy in Europe. As prices rise these taxes can be reduced and be recuperated by the increase in manufacturing activity.

    It is no surprise that Europe will be the first major bloc to come out of the current economic mess since their economy has been the least dysfunctional. How are China and America ever going to resolve their Chimerica imbalances? And how will the UK's SWINEs (Scotland, Wales, northern Ireland, and the North East) deal with the austerity measures to be implemented by the new Tory government?

    renting_is_evil says:
    5:15 am

    'to see the Eurozone as an isolated unit'

    It goes deeper than that – Americans simply are unable to recognize the concrete economic benefits of the euro WITHIN the eurozone. The arguments about design flaws remain, not that any of them are original to English language economists or analysts, regardless of how often they assume no one actually living in Europe was aware of these flaws. Or more importantly, how those flaws could be used as leverage to create a system which would not have those flaws, ie, greater integration.

    And the idea that a falling euro is harmful to Europe is almost laughable – I don't think any executive at Nokia ('anyone need some more cell phone infrastructure?'), or ABB ('anyone need the hydroelectric facility to power it?'), or Airbus ('anyone need more efficient planes'?), or Siemens ('maybe nuclear is better than hydroelectric? – especially with high speed rail') or … well, at least some people get the idea. OK, most of them are in charge of European industrial exporters, but unlike the U.S., those people still count in how their nations are guided.

    And even the idea that exporters require consumers is peculiarly Anglo-Saxon these days. The idea that a country which improve its road network can pay for the equipment and expertise necessary to build it can thus increase its exports is simply ignored – accounting entities may require zero sum thinking, but really, building a dam which allows for increased food production through providing both better irrigation and the power to process the food which is then sold to the country which provided the equipment is not a zero sum game.

    I am not aware of anyone where I live in Germany that has any problem with a falling euro – of course, the 10% gain in German exports just might have be an explanation for that relative calm. And I'll grant, especially for an American with some awareness of how world markets work, that a falling euro is a reason to panic. Unfortunately, the reason for panic has little to do with Europe.

    As a side note – Bloomberg had an interesting euro summary, where it was written, apparently as straightforward truth, that the euro was designed to last forever. Hilarious – no one in Europe expects a currency to last a couple of generations, much less for eternity. After all, Europeans didn't just wake up to the magic 'fiat' idea in just the last couple of years. Ask an East German, or a Slovakian, or a Czech, or …

    charcad says:
    2:09 pm
    It goes deeper than that – Americans simply are unable to recognize the concrete economic benefits of the euro WITHIN the eurozone.

    The source of this failure to see arises with a great many Europeans. They also don't see "the concrete economic benefits WITHIN the eurozone."

    Or more importantly, how those flaws could be used as leverage to create a system which would not have those flaws, ie, greater integration.

    This is closer to the mark. For example, the Frankfurter Allgemeine Zeitung has proposed a northern European "hard" currency zone consisting of Germany, Austria, Poland, Finland and the Benelux countries. Such a revived Hanseatic League would exert a strong attraction on Norway, Sweden and even Russia. This system would certainly have far more economic coherence, cultural unity and political stability minus the Latin countries. Cultural, political and economic factors are all far more closely aligned.

    Someone who has the best interests of the inhabitants of these regions at heart will gladly greet such a project. otoh someone with a hidden true agenda that amounts to looting and pillaging northern Europe under a false guise of idealism will be less than happy.

    Diego Méndez says:
    2:30 pm

    "This system would certainly have far more economic coherence, cultural unity and political stability"

    Don't shy away. Say the right word: "racial" affinity.

    You know nothing about Europe if you think Poland or Russia are more similar (politically, economically or otherwise) to Germany than France or Spain are.

    charcad says:
    5:20 pm
    Dear Diego,

    It was perfectly predictable you'd be less than happy. Your agenda of one way North-South transfer payments has been perfectly clear for many months.

    Well, now that my money is committed to EU bailouts via the IMF, let me join my President in calling on you, a Spaniard, for "resolute action" on your economy. I only do this in the same helpful spirit as Obama's recent telephone call with Zapatero.

    How much will you personally be belt tightening under the new austerity regime? Can we put you down for, say, a 20% reduction? I'm sure you want to set a strong leadership example for your family and neighbors.

    Best Wishes,

    Charcad

    Diego Méndez says:

    10:51 am
    My dear European fellows,

    I would have agreed with you some weeks ago. Not any longer.

    Europe is blind to the conditions it faces. Solidarity is an empty word, as US commentarists suspected all along.

    The only answer to the North-South euro assymetry in this crisis was an Economic Union. The North should have supported inflationary, Keynesian policies at a eurozone level. They didn't; domestic politics proved far more important than Continental monetary stability.

    As I was told repeatedly by NC posters and commentarists, Spain just can't make up for a deficit reduction via higher exports, barring an intra-euro devaluation.

    Kevin, it is just wishful thinking if you think Spain will increase its exports to China and the US 30-fold in a single year, which is what's needed to prevent an economic collapse.

    In other words: since its eurozone partners don't want to help (via inflation, higher deficits, etc.) Spain just can't prevent a decade-long depression unless it gets out of the euro.

    Now, of course, millions and millions of Spanish unemployed simply won't wait 10 years living in misery so that the French and the Germans keep on misbelieving there is some kind of European solidarity when there is absolutely *none*, as proved once, and again, and again.

    If you just don't want to give us solidarity, we'll take it. Forget about some mild inflation in your countries. We'll just get out of the euro, cause a pan-European banking crisis, and devalue our way to full employment.

    Kind regards,

    Diego

    kevin de bruxelles says:
    12:32 pm
    Diego,

    The only sustainable long-term condition both politically and economically in the eurozone is for a nation's consumption to roughly matches its production. The reason there is unemployment in Spain is that there is more consumption than production. This is an economic model that only the United States can get away with (but for how long?).

    So you do not have to export to China or the US to bring your current account balance to a surplus. You can also do it by either consuming less or producing more for domestic production. In other words stop exporting jobs to China, France, or Germany by buying their consumer goods.

    The EU has shown Spain billions of euros of solidarity over the years. Long-term free cash is obviously not the answer. If German and French companies want to continue having market share in Spain then they will have to transfer production there. More production in Spain is the answer.

    Switching currencies is always tempting but there are no magic bullets that will ever allow you to consume more than you produce over the long term. The US model is tempting but I wouldn't advise you follow that path unless you are sure that Spain will be able to find some third world country to work for you like fiends in order to ship you high quality consumer products and be happy to just receive Pesetas in return.

    Diego Méndez says:
    12:59 pm
    "The reason there is unemployment in Spain is that there is more consumption than production."

    I disagree. The reason there is unemployment in Spain is high inflation over the last decade, which rendered it an expensive country for production vs. Germany.

    That inflation was the consequence of the euro and its one-size-fits-all interest rate. Unemployment in Spain would disappear in a second if our salaries and prices were 15% down in relative terms; if we had our independent currency, we could devalue 15% vs. Germany.

    This wouldn't mean a 15% fall in GDP, only a 15% fall in nominal salaries, around 10% in additional long-term inflation and a 10% growth in employment. So real GDP (real wealth) would remain stable, unemployment would disappear and the economy could grow again.

    On the other hand, if European solidarity really was there, there would be no need to leave the euro. We could count on high inflation in Germany and other countries. Thus, in 3-4 years of 4% inflation in Germany, we would be competitive again.

    What are Germans telling us? "Dream on, your problems are yours, we want 0 inflation over here." Moreover, they are telling us to cut our budget deficits (despite our public debt being lower than theirs!) and let our economy implode.

    The rise of economic xenophobia (mainly directed to Greeks, but also to Spain, etc.) in Germany over the last two months have been really shocking, but also revealing: European solidarity is only there for the easy things and the good times.

    Don't get it wrong, Kevin. Germany has shown 0 solidarity this time. All those loans for Greece only saved their own banks. Greece has been directed towards a controlled default in 2 years' time, and an economic implosion in the meantime.

    MacroStrategy Edge says:
    3:09 pm
    Diego -

    Yes, it is absurd that the posters to this blogsite for the most part choose to ignore that I and others using this framework a) called this mess in advance, b) called it right, and c) called it for the right reasons.

    Go back and take a look at what I submitted to this website overr the past few months. You listened Diego. You engaged. Hopefully you benefitted from doing so.

    But it would appear many others find that too daunting a task. Changing your mind doesn't have to be that difficult, but first you have to let go of your one note wonders, and open up to alternative, and sometimes controversial points of view.

    Glad you got there Diego, hope others can as well, but really, the hour is getting late, and the wind begins to howl.

    Lose your delusions folks, before the locust cloud of finanzkapital starts dicktating its terms in your backyard. You can see just how pretty the outcome is when they get the upper hand in places like Hungary, Latvia, Ireland, Greece, and Spain should be next.

    Let's jackboot the humanity out of each and every freakin European culture in the name of accumulation for finanzkapital uber alles.

    And really now, who do you want for a neighbor, Zorba the Greek, or Mannheim the masochistic mittelstand mechanic? Maybe we in fact need both, but maybe some of the most beautiful stuff humanity can create comes out of the former more often than the latter.

    cheers,

    Rob Parenteau, CFA
    MacroStrategy Edge, sole proprietor
    The Richebacher Letter, editor
    The Levy Economics Institute, research associate

    maff says:
    4:30 am
    …and the solution is?
    avrymann says:
    1:26 pm
    If the people of the PIIGS nations are forced to take a cut in pay, so should the Bankers. The debt should be written down proportional to what the people are being forced to accept. It is not only fair, but it might just work. The clincher would be to loan more money to these nations at the same rate that the Federal Reserve now loans to the international banks who are also creditors to the PIIGS – .25%. It is one thing to say "I feel your pain" and quite another to voluntarily "share your pain".

    Since the US Supreme Court has now declared that corporations are persons, then they should be treated as such. They should have to make the same sacrifices as everyone else. Moreover, they should be subject to the same laws as the populace and their decision makers should be imprisoned when they commit fraud, or any other crime.

    I know this is wishful thinking, but it is the solution, along with a reasonable rebalancing of expenditures in the debtor nations and criminal prosecution of corruption in business and politics.

    john haskell says:
    4:40 am
    1. The fall in the euro is explained by the psychopathic behavior of genetically defective portfolio managers who are irrationally selling;
    2. Here are 11 reasons why a reasonable person would be cutting exposure to the Euro.

    Well okay then!

    michel says:
    5:06 am
    Once again, one fails to grasp exactly what the policy recommendation is. It seems to be that Greece should continue to run deficits. To do which it should continue to borrow, as it must. Into the indefinite future? Or is the recommendation that there should be income transfers to Greece by the rest of the Euro zone on the basis that these transfers are subsidies from taxpayers in the North?

    I really do not get the argument. Surely what has happened is really simple, its about debt. Governments have attempted to spend more than the countries produced, on 'public services', which in fact were nothing more than people sitting around in Government offices doing nothing. Of course, if people can do this rather than harvest lettuces or work in production, they will. The average wage level rises, investment falls, debt rises to unsustainable levels, the economy becomes uncompetitive, and people invoke the ghost of an economist from a different era to justify this idiocy.

    The solution the authors seem to envisage, it seems to be simply more of the same, same level of spending, same level of state emloyment on unproductive activities, well, its unclear, but whatever, there is surely only one solution to this underlying problem, close down all those offices and have people do something productive? And not retire at 55 after a working life spent doing nothing, on inflation linked pensions?

    dearieme says:
    6:53 am
    D'ye mean that my tin of Belgian Francs is going to be worth something again?
    joebhed says:
    7:12 am
    Jan and Rob:
    "Some wing of the professional investing world is beginning to see the design flaws built into the eurozone from day one".
    Unfortunately, but obviously, not so for a bunch of NC readers.
    So, another 11 points, please, in reply to Matt above.
    Thanks.
    Ramanan says:
    7:48 am
    There is a nicely written biography and obituary of the late Wynne Godley here. http://www.timesonline.co.uk/tol/comment/obituaries/article7128100.ece

    alex black says:
    7:50 am
    Most of the articles I've been reading on the EU seem to be making the same 4-point presentation:

    1 – There is a big problem.

    2 – Here is a possible solution

    3 – There is no coordinated political will to adopt the solution.

    4 – Oooo, that's gonna leave a mark……

    anon says:
    8:13 am
    "Ultimately, current account surpluses need to be recycled into chronic deficit nations in a sustainable fashion. Such a mechanism could be set up under the auspices of the European Investment Bank very quickly. Effective incentives to recycle current account surpluses via foreign direct investment or equity flows should be crafted at once."

    Doesn't seem MMT'ish at all. That's just changing financial capital structure

    dearieme says:
    8:57 am
    @Ramanan: "Godley (who loved publicity and was something of a tease) acquired a reputation for contradicting other forecasters, usually by being more pessimistic…" – that's why he was known as "Whinge Awfully".
    chsw says:
    9:03 am
    [fill here the blanks] are again the global evildoers:
    "Greece, Spain and Portugal took the first steps last week toward enacting austerity measures that would reduce their budget deficits….were not enough to prevent a flare-up in money market funds, a crucial but little-noticed corner of the financial system in which American investors provide more than $500 billion in short-term loans to help European banks finance their daily operations.
    The cash comes from conservative funds that hold the savings of big American corporations and individual American consumers. So far, the proposed rescue package has failed to ease worries at these funds, which have cut back on loans to European banks and are demanding higher rates and quicker repayment. ….
    Because of the pullback by American lenders, the rate banks charge one another for overnight loans, known as Libor for the London Interbank Offered Rate, has been steadily climbing. ….
    "We didn't do so out of any special love for Europe" …"We're American policy makers,…liquidity problems in European markets were showing signs of creating dangerous illiquidity problems in our own country's financial markets."
    American banks are also big owners of Spanish bank debt, holding nearly $200 billion."
    http://www.nytimes.com/2010/05/17/business/global/17fear.html
    sherparick says:
    9:39 am
    Secretary Geithner, channeling Bob Rubin's and Larry Summers's infatuation with a "strong dollar" and indifference to the industrial/agriculutural economy west of the Hudson and east of Malibu apparently gave an interview where he stated that Europe's problems were "not likely to disrupt America's recovery." Well, I hope he is right because otherwise we we will get the "Tea Party" in control of the House and first item will be the President's impeachment for failing to produce a satisfactory (satisfactory as defined by the Tea Partiers) birth certificate, plus a variety of other outrages upon the Constitution that they claim to love so much.
    NotTimothyGeithner says:
    12:49 pm
    Wow, you really have a high opinion of the Teabaggers. If they took the House of Representatives, they would get rid of the pretense of the birth certificate and impeach the President for his two great sins. One is being a Democrat. The other is on the President's nose. The Teabaggers don't care where the President is from. They would fall all over themselves to vote for the Governator.

    RagingDebate says:
    5:10 pm
    I would think that those that think three levels deep would love the Tea Party. They are advocating exteme austerity measures on themselves.

    The global investor should love them too. Once the country finishes its collapse and the entitlements and beaurocrats are gone, it will be the investment opportunity of a lifetime. Plus, it will be the John Gault's that feel the public wrath.

    Either way, the U.S.A. economic model has gone off the rails and the empire portion crumbling. There is no solution as a species to mass consolidation and corruption from there except breaking apart into smaller sections and once again beginning the consolidation process. That is called evolution folks. Somdeay, the world will reconsolidate into a supply chain the people themselves will run towards, then a global government that survives will emerge. I see that happening in perhaps another seven decades to two hundred years, in other words long after I am dead.

    /L says:
    12:54 pm
    "… otherwise we we will get the "Tea Party" in control of the House …"

    We in the rest of the world look anxious forward to a "great" American show when the one term president is replaced by Sahara Palin and (why not) Glen Beck as vice president accompanied by a Tea Party administration.

    S says:
    11:37 am
    The only thing missing from the clever by half accounting argument is debt and interest rates retrospective and prosepctive. How does that fit into the model?
    michel says:
    12:01 pm
    "Ultimately, current account surpluses need to be recycled into chronic deficit nations in a sustainable fashion"

    Like what? Any ideas? Do we maybe just give them the money? I really, really, do not understand what the proposal is.

    Karen says:
    12:30 pm
    Maff, this seems to be the policy recommendation:

    "3. Ultimately, current account surpluses need to be recycled into chronic deficit nations in a sustainable fashion. Such a mechanism could be set up under the auspices of the European Investment Bank very quickly. Effective incentives to recycle current account surpluses via foreign direct investment or equity flows should be crafted at once."

    But I for one have no idea what they mean. They need to spell out – in concrete, implementable terms – just what it is they think should be done.


    /L says:
    12:47 pm
    This blog post should get a sub title – Euro Crisis for Dummies – and that is an acclamation of making things understandable for us dummies.
    Smells Like Chapter 11 says:
    12:55 pm
    After reading these posts, is there any doubt as to why economics is referred to as the "dismal" science?
    charcad says:
    1:16 pm
    But I for one have no idea what they mean. They need to spell out – in concrete, implementable terms – just what it is they think should be done.

    They intend for you not to understand. What they mean is they want dictatorial powers to transfer wealth around Europe with a wave of their hand, similar to the way they fantasize that Stalin, Hitler, the Politburo, the Paris Commune, Louis XIV and Caesar Augustus did things back in their days.

    Stating this claim too baldly would catalyze instant opposition. Hence the need to wrap everything in tendentious mendacity.

    MacroStrategy Edge says:
    5:01 pm
    Charcad

    The solutions have been spelled out elsewhere, in Richebacher Letters, in TV interviews, in blog posts, in newspaper interviews, in conferences at the Ford Foundation – I could go on, but hopefully you catch my drift.

    Go look for them, then let's talk further.

    Sorry, I'm not hear to spoon feed y'all.

    Let your fingers do the walking.

    Hugh :
    Some of us have been saying this stuff for some time now. What European leaders were doing was a defense, not a fix, for the euro, and as happens with these policy pronouncements, it was unclear how much was real and how much was words. Never a good sign. It is astonishing though that it took 48 hours and longer for markets to begin to pay attention to the obvious.

    Similarly, we have pointed out that the problem is not just with the debt of the PIIGS but with the export surpluses and banks of Northern Europe.

    Northern Europe needs not only to buy from Southern Europe it needs to invest there in a sustainable long term fashion, not the various mortgage and debt bubbles we have seen.

    kevin de bruxelles' view that countries should live within their means is mistaken. It goes to the schizophrenic nature of the construction of Europe. Europe is neither an assemblage of nations nor is it a real union. And that's the problem. Where do Greece's real responsibilites end and those of Europe begin? The North knew about the PIIGS' economic weakness going into the euro. But those were better economic times, the North profited from them, and they didn't care about any potential downsides. Now bad times have come and suddenly, Europe doesn't have a problem, the PIIGS do. As many have said, Europe either needs to go forward or go back. In our country, we have many states, especially in the West that do not pull their full weight. They do not live within their means. They chronically receive more from Washington than they send to it. We do not talk of forcing them to leave. Political union trumps economic disparity. This is the real question that Europe has to answer for itself. If Europeans are European only when it is easy and convenient, then Europe will remain a fiction, a geographic accident.

    Karen says:

    Anyone who thought the Eurozone was even remotely close to a real union was dreaming. It should be obvious that sovereignty still resides almost entirely with the individual nations of Europe. I've yet to read that the EU contributed forces to the efforts in Iraq or Afghanistan.

    The "no-bailouts" clause in the EU founding documents should have made it clear that Greek sovereign debt is NOT backed by the full faith and credit of the rest of Europe but only by the Greek taxing authority.

    There is a lot of opinion that countries need to deficit-spend their way back to a healthy economy, but as far as I can tell that opinion is not backed by any historical examples of success, only by the negative example of our NOT having done that in the 1930s.

    So we are in an experiment, and what is happening to Greece seems to me a warning sign that maybe some people should be a little less sure of themselves in their advice-giving.

    Kievite says:

    Karen,

    The USA is also an experiment and with rise of Republican Taliban it might be that this particular experiment also went wrong . Kind of irreparable mental damage cold war inflicted…

    And it would be nice to isolate crazy states from more sane states in the USA as well. For example what in common has NY with backward places like Kansas where people cannot even understand that they are voting against their own economic interests .

    Jokes aside, this is a financial chess game with huge stakes, fog of war and such. In three-or move moves deep combinations the first move might be very deceptively looking. it looks like this wave of negative press about Eurozone while having some elements of truth is just a tactical move which is partially:

    1. A natural reaction of speculators with "burned finders" as well as "wolfs packs" that were deprived of what looked like a legit meal… It's especially funny to read stories about Eurozone in FT which for all practical purposes should be called "Voice of the City".
    2. Anglo-American financial attack on the continent (divide and conquer, you know) that have a competing reserve currency. BTW It's pretty interesting that I do not hear mad cries about the USA industry competiveness problems due to strong dollar for some reason now. This is very suspicious.
    3. Smokescreen. The USA has an ecological Chernobyl in this backyard right now and GB has recurrent problem with ash affecting air travel. Translated into economical terms both are huge losses which probably make the financial situation in the USA and GB less sustainable.

    Games that were played against Eurozone by financial hackers (aka wolfpacks of speculators) should became part of broad investigation of financial sector in the USA and GB (with possibly some European partners).

    I think European intelligence agencies should work overtime hand-in-hand with FBI to discover the extent of "CDS -> rumor spreading/short selling -> profit" criminal schemes of those financial hackers. Some call them terrorists, but this is probably incorrect generalization; they are more similar to mafia structures with profit as the main motivation. It would be only natural to discover hedge funds controlled by Sicilian mafia .

    Hacking of financial system that they are engaged in should be a crime like hacking of a computer and carry some years of isolation from the society

    anon says:

    5:16 pm
    "In our country, we have many states, especially in the West that do not pull their full weight."

    If you are in the USA, why do you say "especially in the West"? From the stats I've seen, the east and midwest have as many states who are net federal tax receivers as the west does. The biggest tax winner, by a huge margin, is DC. (They get over $5 for every dollar paid in. And those tax dollars obviously benefit parts of Maryland and Virginia as well, both of whom are also large net tax winners without including any spillover effects from DC.) Last time I looked at a map, DC was on the east coast (although I think it would be an excellent idea if they moved it to somewhere – almost anywhere – not on the east coast). MS, WV, AL, and VA were in the top 10 tax receivers, as was LA and KY. NM, AK, ND, and SD were also in the top 10 (though, as a Californian, I consider the Dakotas to be in the midwest along with LA and KY). However, all these states have high percentages of indigenous peoples and I suspect that a large part of the reason that the states are "tax winners". If so, I'd say that the people there still got a very bad deal and so should not be seen as "not pulling their full weight." IMO they've been outright screwed by DC and are still owed much, much more than they'll ever see from the USA.

    NV, CA, and CO are among the biggest tax losers, as are NJ, CN, NH, MN, IL, DL, and NY. In general, the populous states – regardless of where they are located – are much more likely to be tax losers.

    Unfortunately, the latest link I can find is from 1981 – 2005. In the past, I've found more recent data (though it was only through 2007 or 2008 IIRC) that was pretty much the same as this data. http://www.taxfoundation.org/research/show/22685.html

    anon says:
    5:20 pm
    clarification: However, (unlike the "tax winners" in other parts of the US) all these "western" states that are big tax winners (NM, AK, ND, and SD) have high percentages of indigenous peoples and I suspect that is a large part of the reason that the states are "tax winners".

    [Oct 17, 2009] Financial Rapists by craazyman

    nakedcapitalism.com
    October 17, 2009 at 6:59 am

    Financial Rapists

    "Words are the nodal points of numerous ideas, and are therefore predestined to ambiguity."
    -Sigmund Freud, The Interpretation of Dreams

    "Poets are the unacknowledged legislators of the world"
    -Percy Bysshe Shelly

    The technical argument for why firms that leverage beta using the taxpayer's balance sheet are looters is clear to anyone who remotely understands global finance and central banking. I suspect it's also clear, at some level of mind and intellect, to the some of the people doing the looting. To many of the shallower and more reptilian minds involved - which constitute no doubt a dissapointingly large percentage - it admittedly is probably not. Power and profits, to them, are the only moral justifications needed. As both are no doubt, at some level of inarticulated but instinctively accepted reasoning, deserved.

    Financial looting is not now constrained by law, by regulation, or at the individual level, by a sufficiently powerful moral conscience. The easy justification for it is that it is somehow socially necessary to "save" the system. And that the skills involved are "worth" the price paid by society - which includes near-zero interest rates for savers and widespread fiscal and monetary disorder that innervates democracy and sickens spirit of the people.

    Yet society, in fact, is probably lucky that folks with skills such as these can "come to the rescue" and "reboot the economy" for the benefit of all. So states a certain "wisdom", no doubt.

    "Looting" is a reasonably violent word that conveys with some degree of accuracy what these men and women are doing. But it's a word that implies an anonymity of both perpetrator and victim in the context of this usage, with an inneffectual abstraction that lacks semiotic power. It flies through the cinema of the mind like an invisible gust of wind, unarrested and un-stilled by any imagery that is sufficiently shocking and provocative of moral reasoning.

    The language of political and social change needs a more muscular power and an imagery that arrests and convinces at an unconcious level - this is a prerequisite for a broader social turn of collective consicousness. Certainly the banksters and their lobbyists rely on this aspect of language in their own dealings with politicians and academics, and the political and economic establishments are complicit in the acceptance of a veritable thesaurus of synonyms that defang "looting" into "providing liquidity to markets", "intermediating capital flows", "compensating talent", "creating efficiencies".

    A more effective phrase that describes the legally permitted looting of the taxpayer is "financial rape". The imagery is stark and unambiguous, the metaphor is truthful at a structural level, and the notion of a personalized victim and a heinous and brutal action is uncomfortably and effectively conveyed.

    The wife who sees her wealthy bankster husband as a "rapist" is likely to be pitched headlong on an uncomfortable path of self-reflection. The man who wonders in some corner of his mind if he really is a "rapist" may be more amenable to contemplation and enlightened regulation. A society that defines privatized gains and socialized losses as a form of "rape" may be more willing to demand the political and regulatory changes needed.

    The word is not so hysterical as to immediately lose it's descriptive legitimacy, as are the frequent description of political enemies as "Nazis".

    No, rape is a good and accurate word. And when firms counterfeit credit, inflate profits falsely, blow themselves up, get bailed out by taxpayers, pay bonuses with taxpayer monies and laugh in your face - they are raping you and they are "rapists" at an elemental level.

    And so the good men and women, the MBAs, CFAs, the gentle yoga class going, bottled water drinking, organic food eating, marathon running and symphony going worker bees in the brutal corners and principal trading desks of the financial industrial complex - Yes, you are "rapists". And you, central bankers, academics, bailout lobbyists and regulator enablers. You are aiding and abetting financial rape.

    You don't like that word, do you? It makes you get angry and squirm a bit.

    Yeah, that's the point.

    Now think about it. And imagine what if feels like for the person underneath you, while you're doing it to them.

    [May 05, 2009] Our Kleptocracy Saving the American economy by looting it

    May 05, 2009 | unbossed.com

    Our Kleptocracy: Saving the American economy by looting it

    Paul Krugman recently pointed out that wages are falling across America. A week earlier the Treasury Department reported that tax revenue was collapsing at a 14% rate.

    It's easy to see the correlation between these two trends. But what do they have to do with this statement? Everything.

    Sen. Dick Durbin (D-Ill.) has been battling the banks the last few weeks in an effort to get 60 votes lined up for bankruptcy reform. He's losing.
    "And the banks -- hard to believe in a time when we're facing a banking crisis that many of the banks created -- are still the most powerful lobby on Capitol Hill. And they frankly own the place,"

    The first thing to understand is that the banking industry adds nothing to the economy. It doesn't sow crops, make widgets, build homes, or fix your computer. The financial industry sits on top of the real economy in the same way a fungus grows on a tree. In fact, as famous investor John Bogle said a few years before the massive bailouts, the financial sector actually subtracts from the economy.

    "My estimate is that the financial sector takes $560 billion a year out of society," Bogle explains to Bill Moyers. "Banks, money managers, insurance companies, certainly annuity providers. They're all subtracting value from the economy."
    If you add Senator Durbin's comments with John Bogle's, you have a classic case of the tail wagging the dog. The real problem happens when the tail has no regard for the welfare of the dog. We passed that point in the 1980's and only now we are seeing the effects of making that decision.
    Sixteen years ago Nobel-prize economist George Akerlof wrote that investors in the S&L scandal "acted as if future losses were somebody else's problem. They were right." Someone trying to make an honest buck would have "operated in a completely different manner." Instead, they looted.

    Does this sound familiar? If it doesn't, you haven't been paying attention.

    Living with our choices

    Economists are already floating the concept that Americans better get used to a lower standard of living.

    Hundreds of thousands of jobs have vanished forever in industries such as auto manufacturing and financial services. Millions of people who were fired or laid off will find it harder to get hired again and for years may have to accept lower earnings than they enjoyed before the slump.
    ...
    Layoffs now taking place are similar to those in the 1981-1982 recession, when unemployment peaked at 10.8 percent and 2.8 million jobs disappeared, leaving industries such as durable-goods manufacturing permanently smaller. Some 14 percent of durable-goods positions vanished in that slump, and the sector never regained the employment level of June 1981.
    It's funny that they should mention the 1981-82 recession. The obvious implication is that this is simply a matter of the periodic creative destruction of capitalism, and that we should just accept it.
    However, as William Greider describes in his excellent book The Secrets of the Temple, the fallout from that deep recession was so bad because the Federal Reserve made choices. They chose to leave real interest rates at abnormally high levels.
    Manufacturing and farming was destroyed while financial assets boomed during the the mid-80's because of one reason and one reason alone: the Federal Reserve decided who was going to be the winners and who was going to be the losers.

    The same is true this time around.

    The Predator Class

    "When a woman thinks that her house is on fire, her instinct is at once to rush to the thing which she values most. It is a perfectly overpowering impulse, and I have more than once taken advantage of it. . . . A married woman grabs at her baby; an unmarried one reaches for her jewel-box."
    -- Sherlock Holmes from A Scandal in Bohemia

    When a central bank is on fire it will rush to save what it thinks is most important - the bonuses and dividends of the Wall Street clientele. It never considers what will happen to the real economy.
    Today, the signature of modern American capitalism is neither benign competition, nor class struggle, nor an inclusive middle-class utopia. Instead, predation has become the dominant feature-a system wherein the rich have come to feast on decaying systems built for the middle class. The predatory class is not the whole of the wealthy; it may be opposed by many others of similar wealth. But it is the defining feature, the leading force. And its agents are in full control of the government under which we live.

    Our rulers deliver favors to their clients...For in a predatory regime, nothing is done for public reasons. Indeed, the men in charge do not recognize that "public purposes" exist. They have friends, and enemies, and as for the rest-we're the prey.

    In a predatory economy, the rules imagined by the law and economics crowd don't apply. There's no market discipline. Predators compete not by following the rules but by breaking them. They take the business-school view of law: Rules are not designed to guide behavior but laid down to define the limits of unpunished conduct. Once one gets close to the line, stepping over it is easy. A predatory economy is criminogenic: It fosters and rewards criminal behavior.
    - James K. Galbraith

    Galbraith might sound a little melodramatic, but he still hits the nail on the head.
    Bernie Madoff was a piker. Why? Because he thought small. The real Wall Street thieves buy the lawmakers to pass laws to turn their looting into legality.

    It's no secret that a significant part of the Treasury Department and some of Obama's economic advisers are old Goldman Sachs executives (aka Government Sachs). Since the Treasury Department is supposed to be regulating out of control banks like Goldman Sachs, this is a ethical and criminal conflict of interest. Yet no one bats at eye anymore. Why?

    What isn't as well known is the connections between the House and Goldman Sachs.

    Goldman Sachs' new top lobbyist was recently the top staffer to Rep. Barney Frank, D-Mass., on the House Financial Services Committee chaired by Frank.
    Congress is supposed to be the watchdogs of the executive branch, but now it is obvious that both branches of government are owned by the banks they are supposed to regulate.
    Given all this it shouldn't be a surprise that the largest beneficiary of the AIG bailouts was Goldman Sachs.

    Another good example of the rewards of owning the Treasury Department is the Public-Private Investment Program or "PPIP".

    Investors, which under the original plan would have included Treasury, get to borrow FDIC's money to buy toxic assets. This borrowed money comes with no strings attached: If the assets increase in value, investors get all the upside, proceeds of which they use to pay off the debt. If assets keep declining, then investors are out their small equity stake, but no more. FDIC is left holding the bag.

    The WSJ has come out and bluntly said that Congress won't investigate Wall Street. They could be right. Bear Stearns collapsed more than a year ago, and there still hasn't been a real investigation of the banking industry. Have you ever known politicians to be so reluctant to get in front of a camera to fake outrage? They are dragging their feet after trillions of taxpayer dollars in bailouts.

    "...our deepest problem is the ascendancy of finance in national policymaking as well as in the gross domestic product, and the complicity of politicians who really don't want to talk about it."
    - Kevin Phillips

    In fact, attempts at real regulatory reforms are being effectively blocked by the same banks that were saved with taxpayer money.

    "the banksters are eagerly, shamelessly, and openly harvesting their pound of flesh from financially stressed average taxpayers, and setting off a chain reaction in the auto industry which has the very real risk of creating even larger scale unemployment than the economy already faces. It's reckless, utterly irresponsible, over-the-top greed."
    Even the relatively modest "stress test", which was already rigged with unaudited bank information, was delayed by the bankers because it wasn't showing exactly what they wanted it to show.
    These banks can borrow from the Fed at 0% and lend at 4% with little risk, and yet still can't make a profit. Hell, I could make a profit!

    The Peasant Mentality

    In places like France, Latvia, Hungary, Greece, and Iceland, the populace is outraged and taking to the streets. Yet here in America a recent Zogby poll found a majority of the public thinks the news media made things worse by reporting the economic collapse.
    It's an amazing disconnect that I found baffling until I read this:

    After all, the reason the winger crowd can't find a way to be coherently angry right now is because this country has no healthy avenues for genuine populist outrage. It never has. The setup always goes the other way: when the excesses of business interests and their political proteges in Washington leave the regular guy broke and screwed, the response is always for the lower and middle classes to split down the middle and find reasons to get pissed off not at their greedy bosses but at each other. That's why even people like [Glenn] Beck's audience, who I'd wager are mostly lower-income people, can't imagine themselves protesting against the Wall Street barons who in actuality are the ones who fucked them over. . . .

    Actual rich people can't ever be the target. It's a classic peasant mentality: going into fits of groveling and bowing whenever the master's carriage rides by, then fuming against the Turks in Crimea or the Jews in the Pale or whoever after spending fifteen hard hours in the fields. You know you're a peasant when you worship the very people who are right now, this minute, conning you and taking your shit. Whatever the master does, you're on board. When you get frisky, he sticks a big cross in the middle of your village, and you spend the rest of your life praying to it with big googly eyes. Or he puts out newspapers full of innuendo about this or that faraway group and you immediately salute and rush off to join the hate squad. A good peasant is loyal, simpleminded, and full of misdirected anger. And that's what we've got now, a lot of misdirected anger searching around for a non-target to mis-punish . . . can't be mad at AIG, can't be mad at Citi or Goldman Sachs. The real villains have to be the anti-AIG protesters! After all, those people earned those bonuses! If ever there was a textbook case of peasant thinking, it's struggling middle-class Americans burned up in defense of taxpayer-funded bonuses to millionaires. It's really weird stuff.

    It makes one think that the American people would be better off with a monarchy. We seem to want to grovel and bow to our wealthy betters.

    The Age of Mammon by Jim Quinn

    zero hedge

    The Age of Mammon

    Submitted by Jim Quinn of The Burning Platform

    "Financiers – like bank robbers – do not create wealth. They merely distribute it. While the mob may idolize holdup men in good times, in the bad times it lynches them. What they will do to the new money men when their blood is up, we wait eagerly to find out." - Mobs, Messiahs and Markets

    As our economy hurtles towards its meeting with destiny, the political class seeks to assign blame on their enemies for this Greater Depression. The Republicans would like you to believe that Bill Clinton, Robert Rubin, Chris Dodd, and Barney Frank and their Community Reinvest Act caused the collapse of our financial system. Democrats want you to believe that George Bush and his band of unregulated free market capitalists created a financial disaster of epic proportions. The truth is that America has been captured by a financial class that makes no distinction between parties. These barbarians have sucked the life out of a once productive nation by raping and pillaging with impunity while enriching only them. They live in 20,000 square foot $10 million mansions in Greenwich, CT and in $3 million dollar penthouses on Central Park West.

    These are the robber barons that represent the Age of Mammon. The greed, avarice, gluttony and acute materialism of these American traitors has not been seen in this country since the 1920′s. The hedge fund managers and Wall Street bank executives that occupy the mansions and penthouses evidently don't find much time to read the bible in their downtime from raping and pillaging the wealth of the middle class. There are cocktail parties and $5,000 a plate political "fundraisers" to attend. You can't be cheap when buying off your protection in Washington DC.

    Lay not up for yourselves treasures upon earth, where moth and rust doth corrupt, and where thieves break through and steal: But lay up for yourselves treasures in heaven, where neither moth nor rust doth corrupt, and where thieves do not break through nor steal: For where your treasure is, there will your heart be also. No one can serve two masters, for either he will hate the one and love the other; or else he will be devoted to one and despise the other. You cannot serve both God and Mammon. – Matthew 6:19-21,24

    It seems that Lloyd Blankfein, the CEO of Goldman Sachs, may have been overstating the case in saying his firm doing God's work. With his $67.9 million compensation in 2007 and payment of $20.2 billion to his co-conspirators, Blankfein appears to be a proverbial camel trying to pass through the eye of a needle. This compensation was paid in the year before the financial collapse brought on by the criminal actions of Lloyd and his fellow henchmen. After having his firm bailed out by the American middle class taxpayer at the behest of his fellow Goldman alumni Hank Paulson, Lloyd practiced his version of austerity by cutting compensation for his flock to only $16.2 billion ($500,000 per employee) in 2009. I'm all for people making as much money as they can for doing a good job. But, I ask you – What benefits have Goldman Sachs, the other Wall Street banks, and hedge funds provided for America?

    Never have so few, done so little, and made so much, while screwing so many.

    In 2005, the top 25 hedge fund managers "earned" $9 billion, or an average of $360 million. One year after a financial collapse caused by the financial innovations peddled by Wall Street, the top 25 hedge fund managers paid themselves $25 billion, or an average of $1 billion a piece. For some perspective, there were 7 million unemployed Americans in 2006. Today there are 14.6 million unemployed Americans. While the country plunges deeper into Depression, the barbarians pick up the pace of their plundering and looting of the remaining wealth of the nation. Bill Bonner and Lila Rajiva pointed out a basic truth in 2007, before the financial collapse.

    "On the Forbes list of rich people, you will find hedge fund managers in droves, but no one who made his money as a hedge fund client." - Mobs, Messiahs and Markets

    Ask the clients of Bernie Madoff how they are doing.

    1920′s Redux The parallels between the period leading up to the Great Depression and our current situation leading to a Greater Depression are revealing. When you examine the facts without looking through the prism of party politics it becomes clear that when the wealth and power of the country are overly concentrated in the clutches of the top 1% wealthiest Americans, financial collapse and depression follow. This concentration of income and wealth did not cause the Stock Market Crash of 1929 or the financial system implosion in 2008, but they were a symptom of a sick system of warped incentives. The top 1% of income earners were raking in 24% of all the income in America in 1928. After World War II until 1980, the top 1% of income earners consistently took home between 9% and 11% of all income in the country. During the 1950′s and 1960′s when Americans made tremendous strides in their standard of living, the top 1% were earning 10% of all income. A hard working high school graduate could rise into the middle class, owning a home and a car.

    From 1980 onward, the top 1% wealthiest Americans have progressively taken home a greater and greater percentage of all income. It peaked at 22% in 1999 at the height of the internet scam. Wall Street peddled IPOs of worthless companies to delusional investors and siphoned off billions in fees and profits. The rich cut back on their embezzling of our national wealth for a year and then resumed despoiling our economic system by taking advantage of the Federal Reserve created housing boom. By 2007, the top 1% again was taking home 24% of the national income, just as they did in 1928. When the wealth of the country is captured by a small group of ruling elite through fraudulent means, collapse and crisis becomes imminent. We have experienced the collapse, while the crisis deepens.

    It's Good To Be the King The Wall Street oligarchs were able to accumulate an ever increasing portion of corporate profits by inventing securitization, interest-rate swaps, and credit-default swaps which swelled the volume of transactions that bankers could make money on. These products were originally introduced as a means for corporations to hedge their risks. Wall Street shysters chose to use their "creative" financial products to build the biggest gambling casino in the history of the world. They functioned as the house, siphoning off billions in profits, but then got caught up in the hysteria and placed billions of bets themselves. This resulted in the financial industry generating 41% of all business profits in 2007. From World War II through 1980, financial industry profits ranged between 10% and 15%. Simon Johnson explains the despicable hijacking that has taken place since then.

    From 1973 to 1985, the financial sector never earned more than 16 percent of domestic corporate profits. In 1986, that figure reached 19 percent. In the 1990s, it oscillated between 21 percent and 30 percent, higher than it had ever been in the postwar period. This decade, it reached 41 percent. Pay rose just as dramatically. From 1948 to 1982, average compensation in the financial sector ranged between 99 percent and 108 percent of the average for all domestic private industries. From 1983, it shot upward, reaching 181 percent in 2007.

    The original robber barons amassed huge personal fortunes, typically through the use of anti-competitive business practices. These well known titans of industry included Henry Ford, Andrew Carnage, John D. Rockefeller, and JP Morgan. They may have practiced questionable business ethics, but they did create wealth while benefitting the country as a whole. They introduced the automobile, provided the nation with steel, produced the oil that powered our economy, and brought order to industrial chaos of the day. It seems their fortunes were built by creating rather than destroying.

    The disgustingly rich Wall Street wheeler dealers who live in Greenwich CT and NYC and summer in the Hamptons have created nothing. Their immense wealth has been created through draining the economic system of its lifeblood. Their financial innovations have created no lasting benefit for our society. Wall Street knowingly created no documentation (liar loans) mortgage loans, Option ARM loans, and subprime loans. You do not create products that beg for fraud unless you want fraud. The packaging of these fraudulent mortgages into CDOs and CDSs by Wall Street's crime machine benefitted Wall Street only. Those who got the loans defaulted, lost the homes, and had their credit ruined. Wall Street financiers have lured the American public into debt with easy credit and a marketing machine geared to convince the average Joe that he could live just like the rich. Simon Johnson explained the phenomena in a recent article.

    "Excessive consumer debt is an outcome of prolonged inequality – in trying to remain middle class, too many people borrowed too much, while unscrupulous lenders were only too willing to take advantage of such people."

    You Call This Capitalism? Capitalism is supposed to be an economic system in which the means of production and distribution are privately owned and operated for profit; decisions regarding supply, demand, price, distribution, and investments are not made by the government; Profit is distributed to owners who invest in businesses, and wages are paid to workers employed by businesses. The American economy is in no way a free market capitalistic system. It has become a oligarchic consumer capitalist society that is manipulated, in a deliberate and coordinated way, on a very large scale, through mass-marketing techniques, to the advantage of Wall Street and mega-corporations.

    When you hear the Wall Street class on CNBC argue against tax increases for the rich, they hark to the fact that small businesses would be hurt most by the expiration of the Bush tax cuts. There are 6 million small businesses in the US, with 90% of them employing less than 20 employees. These are not the rich. The vast majority of these businesses earn less than $1 million per year. There are only about 134,000 people in America who make on average $2.5 million per year. There are another 600,000 people who make on average $760,000 per year. Out of a workforce of 150 million, less than 1 million rake in over $750,000 per year. These are not small businesses. They are the Wall Street elite, corporate CEOs and the privileged classes that control the power in NYC and Washington DC.

    The following charts clearly show that perverse incentives in the US financial system have allowed corporate executives to reap ungodly pay packages, while the middle class workers who do the day after day heavy lifting in corporations have been treated like dogs. Considering the S&P 500, which measures the stock returns of the 500 largest companies in the U.S., has returned 0% for the last 12 years, the CEOs of these companies would slightly embarrassed paying themselves 300 times as much as their average workers. Not in the age of mammon. Big time CEOs are rock stars. Outrageous pay packages are a medal of honor in a world where humility and honor don't exist.

    The Depression that currently is engulfing the nation was 30 years in the making. The criminal Wall Street financiers are the modern day John Dilingers. They have mastered the art of stealing from the masses while convincing these same people that they should admire them because they are rich. This is the oddity about Americans as pointed out by Bill Bonner and Lila Rajiva.

    "The poor genuinely believe the rich are better than they are. They are smarter and better educated. The poor even support low tax rates for the rich, as long as they have a lurking chance of joining them." - Mobs, Messiahs and Markets

    The truth is that the poor have no chance of joining the the rich. The game is rigged. The poor have admired the rich for decades. But, hard times have arrived. And they are about to get harder. The rich have armed guards to keep the poor at bay. They will need an army of guards before this crisis subsides.

    Leonard Cohen sums it up perfectly in his song Everybody Knows:

    Everybody knows that the dice are loaded Everybody rolls with their fingers crossed Everybody knows that the war is over Everybody knows the good guys lost Everybody knows the fight was fixed The poor stay poor, the rich get rich That's how it goes Everybody knows Everybody knows that the boat is leaking Everybody knows that the captain lied Everybody got this broken feeling Like their father or their dog just died

    Selected Comments
    tom a taxpayer
    - 23:33 #552299

    We need Shock and Awe RICO prosecutions of the robber barons...mass trials in style of the Maxiprocesso (Maxi Trial) of the Mafia in Sicily during the mid-1980s that resulted in hundreds of defendants convicted.

    Rampant criminal activity of the robber barons must be attacked head on. We need coast-to-coast arrests from California Countrywide to Greenwich, CT to New York Goldman Sachs and every other part of the overlapping criminal enterprises, including the mortgage industry, the appraisers, Freddie and Fannie, Citi and the big banksters, the ratings agencies, the Wall Street investment banks, AIG, the federal co-conspirators at U.S. Treasury, SEC, OTS, and the Federal Reserve, especially FRBNY, and the members of Congress who aided and abetted the greatest financial crimes in U.S. history.

    These overlapping criminal enterprises raped and pillaged the mortgage industry, ruined the housing market, destroyed the credit system, endangered federal/state/municipal financing, pension funds, and the banking system, caused massive unemployment, sent the economy into a downward spiral, endangered the world financial system, extorted the U.S. and the world to pay them billions in ransom or face the destruction of the world financial system and economy, and now are costing taxpayers hundreds of billions, even trillions of $.

    The only thing that has any hope of stopping the continual rape and pillage of investors, pensioners, city and state funds, and taxpayers is to see the entire Wall Street RICO crime syndicate along with co-conspirators in the mortgage industry, the Fed, Treasury, SEC, and Congress arrested and perp walked in handcuffs to federal and state jails. Now. Not 2 years from now.

    We need RICO confiscations of the hundreds of billions in illegal "profits" from the criminal enterprises of the banks, mortgage industry, and Wall Street Mafia. We need 20 years-to-life hard time prison sentences.

    It takes only one prosecutor to investigate just one crime, and follow the money and the connected crimes, and bring down the overlapping criminal enterprises using Racketeer Influenced and Corrupt Organizations Act (RICO) prosecutions.

    The prosecutor who leads the charge against the robber barons will become a national hero.

    For a recap of the rampant criminality that begs for prosecution, see William Black's "Great American Bank Robbery":

    http://hammer.ucla.edu/watchlisten/watchlisten/show_id/129363

    William Black is author of "The Best Way to Rob a Bank is to Own One".

    http://www.utexas.edu/utpress/books/blabes.html

    http://www.pbs.org/moyers/journal/04032009/profile.html

    Bill Black's Top Ten Ways to Crack Down on Corporate Financial Crime

    http://www.corporatecrimereporter.com/billblack030510.htm

    IBelieveInMagic

    Now that the game is breaking down, honor among thieves is breaking out! As long as the global financial system with the USD as reserve currency was enabling the US economy scarf down the world's commodities, goods and services at throw away price and enabled folks at all strata to over consume thanks to phony jobs and easy credit, no one complained. But, the societal costs are now manifesting itself in the form of lost middle and low cost jobs while the creamy layers are continuing to benefit from keeping this financial game going.

    Let us accept the fact that these distortions are a result of the reserve currency status of the USD -- as long as we have the reserve status, our economy will continue to bleed jobs.

    FEDbuster

    Just like the mobsters, the banksters have bought and paid for politicians, judges, police (SEC) to continue their criminal acts without fear of prosecution.

    "When a government is dependent upon bankers for money, they and not the leaders of the government control the situation, since the hand that gives is above the hand that takes... Money has no motherland; financiers are without patriotism and without decency; their sole object is gain."

    - Napoleon Bonaparte, 1815

    The rape and plunder will continue until the victims band together to stop it. This will be the decade of "Project Mayhem".

    grunion

    The elitists have only their own interests at heart. They will not rush to the rescue of their bretheren, weakened and falling under the force of angry "sheeple" (your moniker). They will scheme to abscond with everything they can during the collapse. They will not protect each other, just the status quo.

    We can and will have a "come to Jesus" event with these guys and they will be humbled (if they are lucky).

    FEDbuster
    Let the French Revolution be our guide. I am looking forward to see some heads roll down Wall St.
    Cistercian

    That would be great, but the prosecutor who begins will find photos of himself having sex with a 15 year old on the front page of the New York Daily news. It does not matter if the official is clean or not...they will invent a story to destroy him. Which is why things are as bad as they are.

    They either install stooges or destroy the ethical in a relentless, vicious way.

    Once things really crater and the mobs begin to form the lackeys will betray their current masters to save themselves. This of course entails things really getting bad and does nothing to stop the robbery continuing right now. The criminals we have now are the most well connected powerful maniacs the world has ever seen. They own the government, and the government has means of coercion up to nuclear weapons.

    Underestimating how far these sociopaths will go to maintain their stranglehold is unwise.

    It is going to get ugly...very fast.

    Homeland Security

    "... the prosecutor who begins will find photos of himself having sex with a 15 year old on the front page of the New York Daily news" You mean like Elliott Sptizer? He went after the banks and the banks used the NSA/CIA/FBI financial tracking software to see where his money went. It prolly took some intern one microsecond to see that Spitz was bundeling his payments to Ms. Hotpants. The bundeling of payments to stay below the $10K reporting level is a crime. In fact, with "bundeling" there is no reporting threshold, they look at the series of transactions.

    drwells

    Great, isn't it? Doing X is a crime. Not doing X is also a crime.

    fiftybagger

    Or like Blago? Everything was fine until he threatened BOA. Next morning, Arrested. Didn't see the media connect those dots did ya?

    http://www.youtube.com/watch?v=52Pl_maYkQQ

    jeff montanye

    as through this life you travel, you meet some funny men. some rob you with a six gun and some with a fountain pen. (pretty boy floyd, woody guthrie)

    B9K9

    Denninger, glad to see you on board @ ZH. Too bad you brought your myopic and painfully naive viewpoints here as well. Here's a simple heads-up that will hopefully serve to clarify the situation: The state is the criminal.

    What you don't seem to realize, and continually kick people off your boards for saying, is that the chief enabler, organizer & beneficiary is the US government itself. They are the ringleader, the mastermind.

    To paraphrase Voltaire, if banksters didn't exist, governments would have to invent them. They are simply a means to an end. The end is all encompassing government control, fueled by a global reserve currency backed by the muscle of the US military.

    MachoMan

    Bingo. Everyone thinks campaign contributions are to get favorable laws passed and to buy regulators, but why would you need to buy them when they would be forthcoming anyway? They're really just tribute payments to mobsters more or less and/or direct tax (rather than tax that goes first into the general piggybank).

    Further, they operate under the control and jurisdiction of the government, not the other way around. Literally, instantly, the whole thing would turn around if the government desired. Mass prosecutions... etc. Maybe even some treason charges. But make no mistake about it, when the government decides to crack the whip, banksters cower and cringe. Not the other way around.

    Commander Cody

    Agreed. Government enables, banksters implement.

    VWbug

    ditto

    B9K9
    - 08:16 #552672

    duplicate

    aint no fortuna...

    You nailed it tom... nice comment.

    TimmyM

    To really understand how out of control the financial services industry is, sometimes it is good to step back and look at the big picture. While the free market profit motive is the only system that works, many of us individually are caught up in an irrational materialism. Perhaps you do not recognize this in yourself, and this blinds you to the author's point.

    Uncle Remus

    Faith has no place in discussions of markets, law, economics, or finance

    Uuuhhhhh - fiat. Hello...

    jeff montanye

    well played.

    Oquities

    religion is an attempt to codify morality, from a specific point of view. it is not faith. religion is like trying to carve a sculpture from a morning fog. faith is knowing the fog is there even after the sun has caused it to dissipate.

    ATTILA THE WIMP

    The Truth About Religion

    http://www.youtube.com/watch?v=TjGkRFFBd0A

    Homeland Security

    "Faith has no place in discussions of markets, law, economics, or finance."

    Agreed - leave faith out.

    merehuman

    the dollar is worth....bumkis...faith keeps it going. I giggle every time a shopkeeper takes my green papers and gives me real valuable shit.

    Infuckencredible yahoo, more green papers, roll another one

    Homeland Security

    " as Nietzche said, 'if there is not God, everything is permitted" If we are to develop into a sophisticated society that lives in peace and harmony then we need to learn to respect each other as fellow human beings with out religion or with the acceptance of many religions. Population is increasing exponentially and its getting crowded and with out mature, rationale thought and actions I can see tough times ahead.

    Was it not the great Rodney King that said "Can't we all just get along?"

    pitz

    Why do producers and creators (the people who make all the real wealth) continue to work under such a regime?

    Why does a young engineer accept a starting salary of $60k/year, to generate millions of dollars worth of output to the economy every year, and doesn't rebel?

    Have we become a nation of pussies? The finance men aren't exactly holding guns at our heads (yet), forcing our labour. Why don't people just start doing the minimum required to keep themselves alive, and not anything more until this nonsense ends?

    Mad Max

    Real producers are rapidly opting out, as you say. It's about the only realistic option left.

    BTW, I know some young engineers and most would have been thrilled to be offered $60k. Whatever schools may claim, $40-45k is a more realistic starting salary, IF you can even get a job offer in this economy. And a lot of that is because many US businesses are crying crocodile tears when they claim there's a shortage of engineers - they really just want the foreign engineers on H1-B visas who they will pay $20-25k for a couple years and then tell to go pound sand, to be replaced with the next guy off the plane from Mumbai. Both the US and Indian engineers get exploited this way, although the Indian engineer briefly gets a good job relative to what's available in India. There would be plenty of $60k jobs for US engineers, and enough US engineering grads to fill them, if it weren't for the racket of foreign visa workers that major US companies hiring engineers (and computer scientists, etc.) have developed. This is not based on theory - this is based on talking to people in the industry. I know someone who emigrated to the US from India at age 7, got his Ph.D. in computer science from one of the best US universities for that field, and then complained that he might have to move back to India to get a job. Irony.

    pitz

    Yup, I know engineering and computer science grads from 2001, 2002, 2003, who still aren't employed and have never been employed, graduating from some of the top universities up here in Canada.

    Why are they unemployed? Because they won't lower their standards to the levels that the H1-B slave traders want in terms of salary, or in terms of professional behaviour and conduct.

    Many have decided that having no job is better than being in a job that is completely exploitive.

    AssFire

    I hope they rot. There are plenty of high paying engineering jobs. They are malingering pussies. Jobs don't meet their self-worth?? I wouldn't hire anyone who did nothing for 6 months aftering graduating- fricken flakes, it is not gonna get easier.

    pitz

    There most certainly are not lots of 'high paying engineering jobs'. Not by a long shot, and certainly not at the entry level. Are you just trolling tonight, or what? No point in ruining one's health for a job that, after paying for expenses associated with working, doesn't leave any money left over for savings.

    Malingering, hardly. Get a clue. Most would beat your ass to a bloody pulp if you dared spew such bullshit ("malingering") to their faces.

    AssFire

    Look, Ethopians don't fare well in the desert. Go to where the jobs are- Texas. Engineering jobs are plentiful and the cost of living is less. But come sans the self pity manchild.

    pitz

    Certain kinds of engineering perhaps, but not typially Electrical and/or Computer. And employers are very reluctant to hire Electricals and put them into PM roles, unfortunately, believing that the tech industry will sweep them up when it recovers.

    AssFire

    Bullshit, Austin is filled with those jobs. If you are trying to convince yourself that things are going to get better; you had better think again. Hell, the commercial mortgage problem won't even be shit here because of the new arrivals. I'm just saying for the forseeable future, Texas looks good and just about everywhere else is in the crapper. Want to increase your luck? Go where the odds are good.

    If you need to get into a job- forget PM (what makes you entitled to that position?), take what you can get and do something where you can learn another field.

    pitz

    Austin filled with those jobs? Lol. The big companies in Austin have been slowly packing up and shipping as much as they can overseas, not hiring engineers. I'm talking Dell, TI, Freescale, etc. And it was like that even pre-2008 downturn.

    Dingleberry Jones

    And while those jobs are going overseas, the city, full of energetic, enterprising engineers, has increased employment via small businesses. Instead of whining about there being no jobs, create your own.

    The mentality of the entitled is digusting.

    AssFire

    A nation of defeatists. It is clear they are still on their 99 week vacations.

    Jewelsnorth

    PMs? Don't even get me started. That's part of the problem. More and more employees these days want to be a PM to attend meetings all day but not actually do productive work.

    It's about time that a large segment of the Western population wisens up that they're aren't too important to do manual labor. You can't complain about illegal immigration taking jobs but not be willing to work in fields or slaughterhouses, even with that expensive degree in Art History.

    pitz

    Well, an Electrical/Computer Engineer who can't find a job because the H1-B's have taken them all (in software and in hardware engineering) can't exactly easily swing over to civil or mechanical design work. So the PM roles, if they can get them, are often good fits.

    We're not talking about random construction day labour here, we're talking about engineering professionals who have spend hundreds of thousands on their education.

    As for manual labour, there's a lot of progress we can make towards minimizing the amount of it required, but your average man on the street freaks out at the prospect of using a Wal-Mart self-checkout line, or buying stuff from vending machines.

    HungrySeagull

    I don't freak out. What I see is 50 Cashier Lines and maybe 6 express lines. 5 of the 50 cashier line and one special line with tobacco products are open. 4 express lines are open filled with people shoving cartfuls beyond the 20 item limits.

    What I see is a Store filled with employees unable to sit for any length of time. The break room is empty. Yes there is a coffee pot there, but no one may touch or drink out of it.

    And the whole box is a rotting monument to buy buy buy!

    They do one thing well. Grocery and Perishables. Local Grocery Stores die when a Wal Pox shows up locally.

    I have to sit down, think for a minute and reach back 45 years or more and hit a Delicessian where everything is there for you a few blocks from home with 7 employees working day and night. Sweepers come up the street and Arrabers (Baltimore Produce brought up by horse from downtown) come up with grocerys and produce on carts. Milk is hand delivered each morning to your door. Your empty containers are taken away.

    All the powerful have to concern themselves with at that time is making sure that the entire factory is running on all 8 clynders with no misfire or problems anywhere.

    Now the factory sits silent. The workers gone elsewhere or dead. The Materials made over seas and imported while handled by a few people with phones and shipping papers constantly seeking a 3rd world nation to make the stuff cheap, cheaper and even without things that are considered an expense.

    The whole area round the factory has been empty for decades now and nothing moves on the street except brass shell casings and police cars. Anything anyone sees worth doing dont live in the city anymore. They live away, out of sight so that they may still raise children in safety... possibly even entirely off the grid itself. The Children grow up unaware of the sexual, materalistic and vices of society itself until they come out of the woods seeking a life.

    Thier innocents is signed away for college and they come out of there stripped of any humanity left. It is all about money or nothing. Jobs? You dont have a job unless said job involves making decisions that impact other people's lives. And you are expendible.

    Want some humor? Watch a old movie called the "Hudsucker Proxy" which refers to business in a funny light. We have much to learn. Watch Wall Street from the late 80's where we learned greed is good.

    Many times I have heard of powerful people owning very large mansions requiring utilitiy billing large enough to heat and cool a small southern town each month. With square footage so large it must be a millstone on thier necks.

    I say that the Rich and Powerful are lost to the everlasting and enternal grasping of the next big pot, the next big thrill and the eye is never filled.

    If this walmart proceeds down the path of automatic machines for everything, no one will have a job anywhere unless said machine breaks down and a tech support call comes in. That is ok, a few broken down out of order machines waiting a visit from Calcutta India tech out of a line of 50 or so still functioning is not too big of a loss.

    Yea I think one day we will have to settle accounts and make things right, but not by looting, pillaging or killing off those who will die anyway of excessive gluttony, excessive exertions in the bedroom and excessive greed that will choke them in the vault anyway.

    What we do need to do is remember who we are and take care of those who we can while making ready for when the rich finally run out of the very waters that keep them hydrated and come for you and yours.

    Almost Solvent

    Perishables are not done right by Walmart.

    The "fresh" produce from Chili and China look like $hit compared to what's down the street at Wegmans.

    Wilted greens, soft onions, etc.

    I would not buy produce from Walmart under any conditions.

    economicmorphine
    -Assfire, the absolute last thing we need in Texas is more unemployed Yankee malcontents looking for work. The unemployment rate in Texas is creeping up. We have an $18B budget shortfall. We get to choose between the Houston Mafia and Mr. Aggie Goodhair for governor. Things (as we say here) is a fixin to get a whole lot worse. Stay away, Yankee malcontents. If the threats don't work, consider this.......the place you wanna live in Texas is Monterrey. Don't let that little tollbooth on the bridge in Laredo discourage you. Wanna come south? Welcome. Just keep goin til the sign says Bienvenidos!
    defender

    What he says is actually very true. Take Rockstar Games for an example. They expect their employees to work more than 60 hours per week. Of course, they don't say this, they just hint that "Jim wasn't a team player so we had to let him go. Make sure you get all of those objectives done by Monday." Imagine doing calculus homework for 60 hours a week, every week, and you will get the picture. Some further info for you:

    http://www.google.com/#hl=en&q=rockstar+employees&aq=f&aqi=g1&aql=&oq=&g...

    pitz

    Yup. The H1-B's do extremely well in this environment because a) being fired = deportation, b) usually single Indian men, c) very limited access to the US legal system because of a).

    Probably the most problematic thing with the guys I know is that they are top-notch talent, but, because of H1-B's, they simply get lost in the noise. Google, Microsoft, Oracle, etc., only consider less than 1% of applicants for their job openings. So even if you're Linus Torvalds himself, your chances aren't very good of even getting an interview with those firms simply because only a very small percentage of applications are even subjected to human review. That's why its not that uncommon to see people with 5 year resume gaps, or sometimes even longer out there.

    Ricky Bobby

    +1 This is the flat out fucking truth have seen it all first hand. H1's are indentured servants. Corporate Hierarchy is no different then the court of some feudal king, designed to make those at the top Masters of all. Screw the serfs and slaves its all about being a celebrity.

    HungrySeagull

    We had a job running concrete that required about 30 of us to sleep in the plant and pull a 80 hour workweek to get things done that week. Of all the working I have seen, done and accomplished, I will never forget that week while everyone slept stacked like cordwood waiting for the hot summer heat to go down and run concrete in the night to satisfy those who bought, paid for and hired us to get it done before sunrise.

    We got it done that week. Never in my wildest dreams would I see half the places we poured rot in foreclosure today. And that was about 14 years ago.

    VWbug

    I hope they rot. There are plenty of high paying engineering jobs. They are malingering pussies. Jobs don't meet their self-worth?? I wouldn't hire anyone who did nothing for 6 months aftering graduating- fricken flakes, it is not gonna get easier.

    couldn't agree more.

    I have 2 engineers in my immediate family, and 3 or 4 more friends in every field including electrical, mechanical, civil, computer etc.

    All well employed (in canada).

    It's no wonder pitz is unemployed if you ask me. No one wants a depressed, whiny complainer on board.

    If anyone does ever hire you, I am sure they'll regret it fast. You'll poison the atmosphere with your depressing marxist drivel.

    ElvisDog

    I think the 14 junks are unfair, because AssFire does have a point in that workers in the U.S. need to lower their expectations. I know that in the Golden Age of 1980-2008, that workers in the U.S. could expect to make 2-3 times what people made in other countries for doing the same work, but in this age of Globalization and the Internet that situation will no longer be true. You may not like it, it may be disappointing, but there is no avoiding that reality.

    ChopChop

    Agreed. H1B are a good thing but companies don't use them in the right way. There should be a restriction where you are obligated to pay the guy a minimum wage of the average salary for that field in that specific city/region.

    Then there won't be any advantage to take a foreigner unless if he is more talented than an American... or there are no Americans for that job that could fit.

    SWRichmond

    Why do producers and creators (the people who make all the real wealth) continue to work under such a regime?

    Why does a young engineer accept a starting salary of $60k/year, to generate millions of dollars worth of output to the economy every year, and doesn't rebel?

    I did, and for exactly that reason. I made changes to projects under my responsibility that saved /made the company millions, and was rewarded with...more of the same. That is why I am now self-employed, and much much happier.

    Always Positive

    Yes Pitz. Half of you are a Nation of pussies. More than half

    Caviar Emptor

    In the 30 years leading up to the great crash of 2008, American values reached an all time low. Cynicism, apathy and greed were worshiped at the altar of "the new man/woman". But along with the moral compass, we also lost the American ethic that taught generations not to always take the easy way out, cut corners and sacrifice quality for quantity.

    cossack55

    What the hell is wrong with cynicism? A number of great cynics have become famous and maybe wealthy throwing in a little gallows humour...i.e. Mark Twain and Ambrose Bierce come to mind immediately. Will Rogers? Add your own favs. I enjoy being both a cynic and iconoclast and if you twist in some humor people will generally laugh while still getting the point. Try it, its fun.

    The Rock

    This breakdown of this moral compass is brought to you in part by the PTB (Rockefellers, Murdoch, et al.). It's all by design.

    Btw, I think I read somewhere that in the year 2000, there were 18 million manufacturing jobs in the U.S. Now, ten years later, there is less than 11 million manufacturing jobs left... nice.

    Speaking of mammon, here's a nice little bit of info regarding the media:

    MEDIA BLACKS OUT THE FACTS

    Here's one terrific example. John Swinton, the former Chief of Staff for the New York Times, was one of New York's best loved newspapermen. Called by his peers "The Dean of his Profession", John was asked in 1953 to give a toast before the New York Press Club, and in so doing, made a monumentally important and revealing statement. He is quoted as follows:

    "There is no such thing, at this date of the world's history, in America, as an independent press. You know it and I know it. There is not one of you who dares to write your honest opinions, and if you did, you know beforehand that it would never appear in print. I am paid weekly for keeping my honest opinion out of the paper I am connected with. Others of you are paid similar weekly salaries for similar things, and any of you who would be so foolish as to write honest opinions would be out on the streets looking for another job. If I allowed my honest opinions to appear in one issue of my paper, before twenty-four hours my occupation would be gone. The business of the journalists is to destroy the truth; to lie outright; to pervert; to vilify; to fawn at the feet of mammon, and to sell his country and his race for his daily bread. You know it and I know it, and what folly is this toasting an independent press? We are the tools and vassals of rich men behind the scenes. We are the jumping jacks, they pull the strings and we dance. Our talents, our possibilities, and our lives are all the property of other men. We are intellectual prostitutes."

    1953, 2010. SSDD (same shit, different decade...).

    drheywood
    - 05:00 #552509

    Good morning!

    I think this is closer to the root of the problem, than the article's idea that people are too greedy and that we need to read the bible more. (Although the author never says that latter part explicitly, you can sense it, can't you?)

    This crisis isn't about finance, or banks, or taxes or the government. We've seen all this before. And we made the same false claims then as we do know; it's all because of greed, or because of too little regulation, or too much. Nonsense. It's about one thing, and one thing only. The one thing that all sociopolitical battles has ever been about, the one thing that has decided the form of all societies through all times: the production, distribution and control of information.

    We wouldn't have democracy if it wasn't for the printing press, and we wouldn't have the feudal system and organised religion if it wasn't for papyrus. And in a sense, the current financial system is a beautiful manifestation of the flow of information in the US for the last 100 years. A small group of people create the information, and the masses consume it.

    One thing that's different with this crisis is that we have a new medium. A new way of distributing information. For the first time in human history, we have medium that allows anyone to reach everyone. A medium that works both ways, so to speak. This is why websites like ZH is so exciting. *All tingly*

    Ciao!

    ExistentialSkeptic

    we wouldn't have the feudal system and organised religion if it wasn't for papyrus

    That's just silly and prima facie untrue, while if I remember right the Athenians did pretty darn well inventing democracy close to two thousand years before the invention of the printing press.

    Pull the other one, its' got bells on. ;-)

    Always Positive

    In a way, I admire the elites, the movers & shakers, the oligarchs, the rapers & pillagers, the robber barons, the shysters - I mean THEY'RE JUST GOING FOR IT!!! No restraint, no morals, no compassion, no regrets!! Just full-on, full throttle, totally & completely selfish with only ME! as a reference point!

    Isn't that just a reflection of much, even most, of society in general, even YOUR little corner of the world, writ small?

    We get what we deserve and don't have long to wait. Maybe Blankfein is doing God's work, showing us ourselves.

    merehuman

    not me, i share and always have. But never deal with crooks and never took advantage of anyone. I take a small pride in remaining a good guy in honor of my honor. I am an honest soul. And there is many another like I.

    Always Positive

    I respect you merehuman; sadly, you're in a diminishing minority. But would you take a serious offer (say, 6 billion for your honour)? Most sell out for much, much less.

    HungrySeagull

    No need to sell out. When one is free of debt and house, family and everything is in good order along with needful things ready for a time then.. the rest are sent on thier way. It is far better to feed someone who is hungry in secret than to wear golden robes and broadcast in the tall towers what millions they have fed.

    You wont believe how much we were able to do these last few years on so little. If memory serves we cut trees and kept people warm during the winter. We did not take any money and we did keep some wood for ourselves. There is more for next winter that is coming and two households will come to get it when it cools off sufficently for the labor to make it done.

    These "Poor" have very good memories, and loyal are they to those who help them without requiring anything of it. We are poor yes, but we have no need of anything at the moment. So we do share a little bit.

    If you picked up a rich person worth millions per month and hold him upside down, the loose change from his pockets will make 10,000 people in our area be able to stay warm and cool for at least the next 10 years with warrantry and service to maintain these machines.

    But no, the rich will not share. They never do. And when they do give, they have the other hand out with either a knife for your pound of flesh or ready to choke you on something else.

    So. Let the Rich rage. But yet thier anger only lasts a hour or life time. We have as a Human Race on this Planet been here for millions of years with or without instructions or need of money and riches made do with what little we were able to earn by our daily bread and the sweat and labors.

    Blankman

    You may be free of debt and house, but you are never free of taxes. When the taxman comes to collect you better have you cash or off to the place where yes you are relatively free - 3 squares and a cot. Good luck in your commune.

    frosty zoom
    - 23:58 #552347

    communism becomes (de facto) capitalism...

    capitalism becomes (de facto) communism...

    and both in their worst forms.

    it's not new york, 1932; it's moscow 1989.

    laughing_swordfish

    CULTURAL REVOLUTION BITCHEZ --

    guidoamm

    A good rant as far as it goes. However, as is often the case, blame is laid at the feet of proximate causes like hedge fund managers.

    Upstream of fund managers and bankers there is the monetary system. In the particular case of a fiat monetary system, the logical evolution of the system leads inevitably to concentration of profits in the finance industry simply because banks and the corollary of financial institutions that operate around them are first in line to make use of newly printed money.

    As fiat money conforms to the law of diminishing returns, each unit of currency is progressively devalued from the instant it is created as it is handed down to the treasury, then to the primary dealers, then to other banks till it finally reaches the pockets of the great unwashed - this is the point at which the currency has been devalued most (i.e. the point at which it has least purchasing power).

    As the fiat monetary logic progresses over time, eventually the ripples of devaluation spread in ever wider circles. Thus from personal bankruptcies you move to commercial, then municipal, then state and, finally, sovereign bankruptcy becomes probable if not inevitable.

    TwoShortPlanks

    Madoff is in the safest place...for now.

    laughing_swordfish

    Nuremberg Tribunals for Politicians, Banksters, Lobbyists, and Multinational CEO's...

    Confessions of "Crimes Against The State" carried on live TV...

    After that, we take a page from "Uncle Joe" Stalin's playbook and let the purges begin..

    Remember, it's ONE Politician per Lamppost...

    ONE Bankster or Lobbyist per Treelimb...

    ONE CEO or Hedgie per Impalement stake..

    4 meter stakes for the CEO's...5 meter for the Hedgies (they complain about the smell)

    And the lackeys or fellow travelers who don't repent and switch sides?

    500 lb. Trapezoidal knife on the neck...

    Paging Madame DeFarge...

    Hang The Fed

    It just goes to show that capitalism, communism, or whatever-ism will always be exposed to usury by some pile of jackasses who believe that they're somehow better, whether they paint that portrait in the strokes of religion, finance, or any other social vehicle. Further, the only thing that makes it work, every time, is the complicity of those on the receiving end of the great shafting. Never mind that the skins in which the "elite" wander about are no better or more valuable than any others.

    Sadly enough, we've taken such joy in manipulating everything, from finance to the world that surrounds us, all in the name of "getting ahead," that we've forgotten that it wasn't a tremendously long time ago that we were still just monkeys hurling shit at each other in the trees. Hahaha, if you don't believe me, watch the bloviating fucktards on CSPAN for a bit...maybe the face is different, but the paradigm still stands.

    The only difference between then and now, really, is that we've propped up this useless existence for so long that the damage to other systems is becoming "inconvenient" to our way of life, or, if you're looking at it from my end, completely fucking disastrous...so much for our comfy belief in manifest destiny, or some deus ex machina moment to bail us out. If cats have nine lives, I wonder how many of ours we've used up already?

    Hang The Fed

    On that note...I'm going to try to avoid throwing up in the next five minutes. Anyone want to take out a CDS against that event?

    count_zero

    While there's certainly truth in this article, it's too light on the other offenders. What has happened has been a FAILURE AT EVERY LEVEL. The Fed's loose money, gov housing mandates and interference, bankers obscuring bad loans into CDO's, rating companys' rubber stamps, investors who bought the crap, loan officers fudging numbers, and finally, people buying homes with loans they couldn't afford.

    Everyone assumed someone else was making sure things were ok. Oops!

    Hang The Fed

    Manipulation+complicity=OH, SHIT!!

    guidoamm

    That's right. But the lack of monitoring is not an omission; it is deliberate.

    Fiat money has an inbuilt reset mechanism. If left alone, a fiat monetary system would bring about regular periods of slow growth and/or recession. The desire of the authorities to short circuit the system so as to keep it on a perpetual expansionary trajectory, can only be achieved by intentionally masking the imbalances that result from this policy.

    As fiat money conforms to the law of diminishing returns, the imbalances that are brought about and that manifest themselves in diminished purchasing power of the currency (declining intrinsic value), can only be masked by expanding credit. Hence the vital need to keep credit markets on an expansionry trajectory that must neccessarily be faster than the expansion of the underlying economy by any means such as Off Balance Sheet Investments, or Special Purpose Vehicles, or CDSs, or MBSs or special accounting treatment for select entities like Fannie Mae or Citibank for example. Hence the reason that, for example, since 1980 GDP has expanded by 100% (it has doubled) but Federal debt has expanded by 1200%. Hence the reason that as the fiat monetary logic pushes its own mathematical limits (as in 1929 or in 1970), nominal profits concentrate in the financial industry.

    As the logical conclusion of fiat money approaches, the authorities will prevent regulation and apply special provisions to select entities, mostly represented by banks but also by other political groups such as unions, in a gambit to both keep government alive (raison d'etat) and keep profits flowing to the banks.

    It's all a logical necessity of this type of monetary system as was suggested to politicians it should be imposed by a select number of banks in 1913.

    Hang The Fed

    The Creature from Jekyll Island will certainly swallow us whole.

    Segestan

    Reads like some socialist rant. The top of the food chain is just as fucked as the bottom once the game implodes. Perhaps they will build Ack-ack towers?

    VWbug

    Reads like some socialist rant.

    it's is a good example of how in reality religion and socialism are simply variants on the same theme (you are your brother's keeper, money is the root of all evil, reason is bad, faith is good, etc etc)

    yabs

    I think this article misses the point in some respects. The CDO's etc, credit deafult swaps

    are a symptom of the problem not the cause.

    The cause is a monetary system that needs perpetual growth. When a mature economy like the US no longer actually needs to grow anymore

    I mean it has most of the roads it needs, the shops it needs and every perosn who can get a mortgage has then there is only one option for growth

    create s synthetic economy and thats what happened. the banksters are scum for not having the morals but they are really only playing the system which is the route of the problem.

    It makes me laugh when I see Rothchild going around the world in a boat to promote global warming and the environement when its his families money system which has caused all the problmes in the first place

    growth for growths sake is a cancer and now

    the cancer has overpowered the victim

    death is near

    cossack55

    Got to agree, Yabs. I don't get why folks think growth is constant. I can't think of one thing in nature that grows forever. They say even the universe, though, still expanding, will reach a point and then contract. Illogical

    AssFire

    There are lots of jobs down here in Texas- especially for mechanical engineers & fabricators. The land rig business is booming and businesses are moving in from all over (running from their former state's taxes).

    We surpassed California several years ago as the nation's largest exporting state. Manufactured goods like electronics, chemicals, and machinery account for a bigger chunk of Texas' exports than petroleum does. In the first two months of 2010, exports of stuff made in Texas rose 24.3 percent, to $29 billion, from 2009. That's about 10 percent of the nation's total exports. There are more than 700,000 Texan jobs geared to manufacturing goods for export.

    While the nation continues to lose jobs, Texas has added 181,500 jobs this year through July, including 30,700 in the D-FW area. D-FW gained 2,300 construction jobs in that time, but the 158,000 total was 6.5 percent less than a year ago.

    Texas accounts for more than half of the 10 largest upcoming construction projects in the South, valued at about $15 billion. That includes the $2 billion second phase of the Dallas Logistics Hub in southern Dallas County and the $1.2 billion DFW Airport terminal redevelopment.

    Texas has supplied over 55% of the jobs in the US and responsible For 111.5% Of All Private Job Creation In Last 12 Months

    Bottom line if you want to work, you might need to do it here; or just wait for your state to cut back (if you can wait forever).

    HungrySeagull

    Yes, I agree with the Texas Solution. Go big or stay out of Texas. Imagine for a moment if every state in the union was properly run as Texas was run. We would have such a embarrasment of riches with untold prosperity and able to carry the world to such heights of wonder and awe at the wonderful things they can only dream of watching American Movies in thier theaters.

    The States with the most crushing taxes have managed to groan and stagger under the constant and unfettered hunger that gnaws upon them as the riches move out and everyone who can afford to flee. Taking the revenue and production with them to free states that have no need of such taxes to stay properly functioning.

    Indeed the exodus that we think we have seen these last 10 years now will become a pernament change in the future as the Union breaks up into a loose collection of regions with very different laws, some of which will be against everything that America has ever been good for.

    dondonsurvelo

    guillotine

    three chord sloth

    Nice. Quite a good rant.

    The trouble is this: Where are you gonna turn to fix it? The government? Hah! The financial robber barons are one wing of the pincer movement crushing America... unfortunately for us, our government (who is supposed to rein them in) is the other half. We have nowhere to turn.

    The coup by the financial industry began 3 decades ago; the master/servant inversion by the government began 5. The die was cast in the early 60's, when government workers were permitted to unionize. Once the bureaucracies were allowed to become their own special interest the citizens lost control of their government. We are working for them, they aren't working for us any longer. We don't set the agenda anymore, DC and Wall Street pull the strings and the elected puppets dance.

    You see, bureaucracies do a few things quite naturally; they expand, they grow inefficient, and they forget their original mission and focus primarily on their own internal needs. Under the best of circumstances it's difficult to keep the government contained and focused; add in civil service protections and it becomes damn near impossible. Throw on another layer of armor from union contracts and forget about it... the servants have taken over the manor. Government will do what is best for the government... their motivations are strictly internal now.

    And here we are today... trapped between a predatory financial sector who is allied with a predatory government. A classic pincer movement. The feds pretend to regulate and reform the banks, the banks pretend to be contrite and reformed, the "watchdog" media praises the charade and gives awards to itself for "bringing the issues to light" and "forcing needed changes", and the looting continues.

    So where are we supposed to turn?

    Temporalist

    Ahhh, god's country...and he can have it along with all those mega churches.

    A lot of good seceding will do when you will need all good agrarian states to feed your people...or you can live off fish from the GOM I guess. Not everyone can be an oil baron.

    HungrySeagull

    Don't forget the Bull, Cattle and great resources. Parts of Texas and the greater part of that western region keeps the rest of the United States in Beef. Throw in the Grain from the Dakotas who have lived carefully and within thier means suffering none of the collapse that others have suffered. Then look to Nebraska with such water and land that one can only dream of when standing on a grimy and choked city street that has been sinking each year since Manhattan was bought from the Indians 200 years ago. Look further into the Mountains where you must work to live or die.

    Once a time long ago common people endured 6 to 9 months walk to get to these great western lands. The ones of good stock that survived the trip are able to make do with what they have and they have done well.

    The problem I see now is the great danger of those who have nothing but money and tender hands that have not seen labor going to these places and trying to buy it all.

    Aint gonna happen.

    guidoamm

    The coup began in 1913

    ATTILA THE WIMP
    - 08:20 #552678

    It's simple. Just watch for the "riot dog."

    http://www.huffingtonpost.com/2010/05/07/hardcore-riot-dog-seen-at_n_568271.html

    Djirk
    - 04:03 #552475

    If we had a government with balls (or guts for da ladies) there is an easy fix.

    Raise the tax rates to 50-60% for the top 1%, while closing the loopholes.

    Given that rock stars, CEOs and bankers make money from the sales, labor and pensions from the other 99% it is in there interest to make sure there is a market for thier "services"

    Especially the later group of "investment" bankers who siphon funds from the retirement funds of others.

    A non political solution for the last group is for the buy side pension and mutual funds to grow a pair and not rely on sell side, funds of funds, hedge funds and private equity who siphon returns.

    When you go to the super market, do you ask the snot nosed check out clerk which vegtables to buy?

    Do your homework, look for longer macro trends in industries with real economic growth (or at least throwing off cash) and buy from an electronic exchange. Fjuck the sell side traders and funds of fund of funds of funds of funds and their filthy carry.

    Jesus can't help you now!

    hugolp
    - 04:54 #552517

    What about eliminating all the subsudies for business?

    VWbug
    - 07:56 #552633

    excellent idea. they should eliminate all subsidies, to farmers, fishermen, etc.

    guidoamm

    Raising taxes on the top 1% will not solve the underlying problem which is the monetary system. Besides, the top 1% can very easily shift wealth and/or domiciles and residence across borders. Taxes are not an efficient solution to this crisis.

    Djirk

    Agreed, over leverage and leveraged market speculation (especially in commodities and FX) cause major problems. Not to mention the financial illiteracy of the US public are both different problems. But there could be a better tax structure where the % of income earned is closer to % taxes paid in the country where income is derived. There would be of course gaming of the rules, but now it is ridiculous.

    Now the wealthy individuals, especially financial services employees are destrying thier own source of income by this wealth allocation structure.

    Not to mention investment bankers are WAY overpaid for the service they provide to society. Sorry to burst your bubble lord Blakenscheck, but GODmansachs employees are not just more productive.

    VWbug

    Not to mention investment bankers are WAY overpaid for the service they provide to society. Sorry to burst your bubble lord Blakenscheck, but GODmansachs employees are not just more productive.

    How do you know? Mr Market says otherwise. I'm betting mr market is right.

    docj

    Well, that's of course true. And personally I'm all for letting people keep everything they earn minus a small piece off the bottom (say, 3-5%, total) for fed/state/local gov'ts to provide basic, and charter (Constutionally) mandated services.

    But so long as we're going to bail-out the so-called "Too Big To Fail" on a regular basis then I say fuck-em - 99% taxation above some threshold (say, $10M).

    MiningJunkie

    "So you think that money is the root of all evil?" said Francisco d'Anconia. "Have you ever asked what is the root of money? Money is a tool of exchange, which can't exist unless there are goods produced and men able to produce them. Money is the material shape of the principle that men who wish to deal with one another must deal by trade and give value for value. Money is not the tool of the moochers, who claim your product by tears, or of the looters, who take it from you by force. Money is made possible only by the men who produce. Is this what you consider evil?"

    Francisco D'Anconia (Atlas Shrugged)

    Horatio Beanblower

    Relax, everything will soon be OK...

    "Anton Kreil, who starred as the portfolio manager in the BBC Two programme that gave eight members of the public $1m (£640,000) to run their own hedge fund, has set up a training business, called the "Anton Kreil Institute of Trading and Portfolio Management", to give students and private investors an insight into the complex world of share trading.

    The school is aimed at helping its students gain an insight into how the top 5pc of City traders make real money." - http://www.telegraph.co.uk/finance/markets/7970715/Star-trader-Kreil-to-share-his-million-dollar-tips.html

    http://www.antonkreil.com/category/institute-of-trading-and-portfolio-management/

    The HFT lessons should be good fun.

    MarketFox
    - 06:32 #552558

    The Harvard Princeton Yale Club....

    Once in...you get a shot at being in the 1% of the US population that controls the same level of wealth that 90% of US population has....

    Sound fair ?????

    Troy Ounce

    Tell me, what are the chances the Dems pull the plug and turn their back on Wall Street?

    Yes, I agree, WS would shut down the banking system and mayhem would follow.

    But if the Dems want to have power to govern that would be the only option open to them, no?

    Eeehhh, sorry, that ...and war.

    docj

    That train left Barry Obama station the day he signed-on to the Bush bailouts - before he was even elected.

    TWORIVER

    Some call it Babylon. Politricks, I say.

    wareco

    Sorry Lenny Cohen, but you suck as a singer. Everybody knows that Don Hensley's remake of Everybody knows is a much better rendition. http://www.amazon.com/Actual-Miles-Henleys-Greatest-Hits/dp/B000000OUU/r...

    jailnotbail

    This could all be solved quite easily, were there the desire to do so. For instance, below is A modest proposal by Professor Emeritus Richard Wolff, published under the title "Economic Recovery for the Few" @ http://www.rdwolff.com/content/economic-recovery-few

    Now, of course the mere mention of such a possibility will ignite howls of interference with the sacrosanct free market, and outrage at the suggestion of such a violation of property rights, and general wailing and crying.

    This is to be expected. And the proposal itself is, of course, beyond the wildest possible politically feasible solution.

    It's a non-starter. Instead, we shall punish the innocent, and reward the guilty with absolute dominion over those whose lives and country they have ruined. The predators will rule like gods over the sheep, and the republic will be consigned to the dustbin of history.

    Where is this elusive recovery? The banks, some say, have "recovered." Yet they remain dependent on Washington, they do not make the loans needed for a general recovery, and many medium and small banks keep collapsing. The stock market shows no recovery. The Dow index was 14,000 in late 2007 when capitalism hit the fan, and it is around 10,000 now. The Nasdaq market index was 2800 then and is 2300 now. Everywhere else -- unemployment, foreclosures, bankruptcies, depressed housing market, and so on -- no recovery in sight. Yet, my search finally found genuine recovery for one group, and its recovery offers a better policy to treat this crisis.

    Every year, two major companies catering to rich investors co-author a survey of their clients. Capgemini and Merrill Lynch Wealth Management's World Wealth Report covers the two groups that interest them: High Net Worth Individuals (HNWIs) and Ultra-High Net Worth Individuals (Ultra-HNWIs). The first group counts all individuals with at least $1 million of "investible assets" in addition to the values of their primary residence, art works, collectibles, etc. The second group includes individuals with at least $30 million of such investible assets.

    Their latest Report, covering the year 2009, finds 10 million HNWIs in the world that year: 3.1 million in North America, while Europe and Asia-Pacific each had 3.0 million. The rest of the world had a mere 0.9 million of the rich and richer.

    The 10 million HNWIs -- in a global population of 6.8 billion in 2009 -- amounted to 0.14 per cent of the earth's people. Together, they owned a total of $39 trillion in "investible assets." To see what this means: in 2009, the US GDP (total output of goods and services) was $14.6 trillion. The combined GDPs of the world's 9 richest countries(US, Japan, China, Germany, France, UK, Italy, Russia, and Spain) totaled less in 2009 than the investible assets of the world's HNWIs.

    During 2009, as tens of millions lost their jobs, the number of HNWIs rose by 17.1 per cent and their combined wealth rose by 18.9 per cent. They had a genuine "recovery." HNWIs regained in wealth most of what they lost in 2008. No wonder they celebrate "recovery" while the rest of the world wonders (or rages at) what they are talking about. In the US, for example, the HNWI population grew by 16.6 per cent in 2009 while the US GDP fell by 2.4 per cent.

    Only 1 per cent of all HNWIs were Ultra-HNWIs, but what a group that was and is. Ultra-HNWIs alone owned 35.5 per cent of the $39 trillion owned by all 10 million HNWIs. And they recovered more during 2009 than their fellow HNWIs.

    Capitalism is the name of the global economic system that delivers the outcomes summarized in these numbers. Capitalism produces "recovery" for those who need it least while offering austerity for nearly everyone else. Today's business and political leaders tell the people of all advanced industrial countries that there is no alternative to years of government budget austerity (raised taxes and/or reduced government employment and services).

    They don't explain that they could tap instead the immense wealth of the richest 0.14 per cent who (a) made huge gains in wealth over the last 25 years, and (b) already recovered in 2009 what they had lost in 2008.

    What notions of fairness, decency, ethics, or democracy could justify such economic performance, especially in a time of global economic crisis? Recall as well that these same rich and richer people contributed so significantly (as industrial employers, bankers, and investors) to generating that global economic crisis.

    Let's now concentrate on the HNWIs in just the US (including its Ultra-HNWIs). They numbered 2.9 million in 2009: well under 1 per cent of US citizens. Their investible assets totaled $12.09 trillion. For 2009, the total US budgetary deficit was $1.7 trillion. Had the US government levied an economic emergency tax of a modest 15 per cent on only the HNWI's investible assets, it could have erased its entire 2009 deficit. Over 99 per cent of US citizens would have been exempted from that tax.

    The European, Japanese, and other governments could have treated the crisis likewise in their countries. Then governments would not have had to borrow trillions. They would instead have taxed the super rich tiny minority a small portion of its immense wealth. Those governments would not then have had to turn to lenders (often those same super rich). There would be no current "sovereign debt crisis" in Greece, Portugal, Spain, Ireland, etc., and no need for the resulting austerities to satisfy those lenders. Republicans would have no "deficit, deficit" drum to beat hoping for election-day gains.

    Taxing the HNWIs and Ultra-HNWIs would be the policy of governments responsive to the needs of their working-class majorities instead of their rich and super-rich patrons. Austerity is not the only policy. Modestly taxing the wealth of HNWIs is the far better policy choice. The two wealth management companies that cater to HNWIs have kindly provided us all with the facts and figures needed to support the better policy.

    Across Europe, coalitions of trade unions, socialist, communist, and some green parties, and many social, religious, and community organizations are organizing growing mass demonstrations and general strikes. These oppose austerity and demand alternative ways to deal with economic crisis. In France, mobilization focuses on a nationwide general strike September 7. Plans are underway for an all-European day of public actions on September 29. National actions like this have already happened in Greece, Portugal, and other countries.

    The business and political leaders generated by the last 30 years of neoliberal capitalism simply assumed that they could impose the costs of their crisis on their countries' people. That assumption is now being contested. The European people are beginning to fight back. And here, in the USA?

    docj
    - 08:33 #552695

    Capitalism is the name of the global economic system that delivers the outcomes summarized in these numbers.

    When you start your "analysis" from such a ludicrous premise the ensuing lunacy is to be expected, I suppose.

    ElvisDog
    - 10:00 #552831

    Here's the problem - the U.S. has a structural deficit of about $1T, so for your "tax the rich" scheme to work you would have to take 15% of the Ultra-wealthy's wealth every single year. Do you really think they would sit around and take it year after year? No, they would bug out as fast as they could taking their wealth to more friendly countries.

    RockyRacoon
    - 11:53 #553105

    Think of it as a claw back. Kinda like the gov't saying, "Ooops, our policies allowed you to be overpaid a tad there." After enough of being clawed-back to death there would be some reforms. Like maybe some sort of way to hide the wealth. I think Greece has some experience we could tap to reach that end. Those who don't get covers for their swimming pools or register their yachts in small Caribbean countries don't deserve to keep their spoils!

    Blackheath
    - 08:14 #552667

    There is no doubt that the stratification of classes is more prevelant in the recent past in the US. Two comments: (i) historically, you need to look further in the past; and, (ii) it is ironic that there are so many "libertarian" thinkers and commentators on these pages, yet the group-think seems to be to rail against enterprise - fair or unfair - highly (overly) or not compensated. That really makes it easy to feel victimized by the "evil" bankers. That is just the mental equivalent of curling up in a fetal position. Unless you all want to be living in a more socialistic state like Germany, Britain or France (nothing wrong with this, mind you...), then you may want to consider that historically, the disparities between the top and bottom are not so wide now to be out of range (look it up) and if you are truly interested in limited government then let people earn what they can - absent fraud. We have a lot of laws that prevent fraudulent behaviour (except with the government sanctions it or participates). Sure, respond agrily...

    Arraya

    The US mirrors the world in wealth distribution. And, yes, todays stratification is it is not out of line historically. All wealth structures pull wealth from the periphery towards the center. Which is why we get a pyramid structure with wealth concentrated at the top and "wealth conveyors" pulling wealth towards the center. Debt markets are a good example of "wealth conveyors" . The US is the center of the global economic structure, so it gets wealth conveyed to it in the form of resource extraction via globalization and sophisticated forms financialization.

    Now is about the time in history when these wealth conveyors start to break down. As time goes on, we should see an increased number of failed states globally and underclass internally. As the periphery gets stripped of all it's wealth, the elite will move further up the pyramid via public policy to maintain their privileged positions and levels of wealth extraction as well as increased fighting over resource deposits on a global scale. This really can't be stopped and what we are witnessing is the elite using their political power not to lose their god-given share. As time goes on, and the wealth pie shrinks, even they will start to turn on each other as their is not enough to go around. It should be quite a show.

    jailnotbail

    From Wikipedia:Capital offences in the People's Republic of China - Crimes of Financial Fraud

    12. Whoever, for the purpose of illegal possession, unlawfully raises funds by means of fraud 13. Whoever commits fraud by means of financial bills in any of the following ways:

    (1) knowingly using forged or altered bills of exchange, promissory notes or cheques;

    (2) knowingly using invalidated bills of exchange, promissory notes or cheques;

    (3) illegally using another's bills of exchange, promissory notes or cheques;

    (4) signing and issuing a rubber cheque or a cheque, on which the seal is not in conformity with the reserved specimen seal, in order to defraud money or property; or

    (5) signing or issuing bills of exchange or promissory notes without funds as a guaranty, in the capacity of a drawer, falsely specifying the particulars thereon at the time of issue, in order to defraud money or property.

    14. Whoever commits fraud by means of a letter of credit in any of the following ways: (1) using a forged or altered letter of credit or any of its attached bills or documents;

    (2) using an invalidated letter of credit;

    (3) fraudulently obtaining a letter of credit; or

    (4) in any other ways.

    ... AND if the amount involved is especially huge, and especially heavy losses are caused to the interests of the State and the people.

    15. Whoever falsely makes out special invoices for value-added tax or any other invoices to defraud a tax refund for exports or to offset tax money if the amount involved is especially huge, and the circumstances are especially serious, thus causing especially heavy losses to the interests of the State. 16. Whoever forges or sells forged special invoices for value-added tax shall, if the number involved is especially huge, and the circumstances are especially serious so that economic order is seriously disrupted.

    And they mean it, too.

    bankonzhongguo

    There will NEVER be ANY sort of offical investigation/prosecution of these this elite class of banksters/lobbyists.speculators that ran the Republic into the ground like Soros did with Asia in the 1990's. There is no Truth and Reconcillation Committee. Everyone knows it. There wasn't after the First Great Depression, or the Second. The few with much to lose have already left the country - hanging their shingle in Dubai, or some other gelded monarchy, waiting for the statue of limitations to run or to avoid another half-assed subpoena, to dance a fantasy that more consulting to make/trade debt paper is a possitive impact for society. Everyone knows its a farce.

    It is most regrettable that as the real economy decouples from the Central Bank fantasy of bailing out wholesale Patrician waggering; people - Citizens, cold from the Winter, dreadful of their children's ruined future, starved for Justice will bizarrely act out of rage on those perceived un-punished criminals.

    A saw a t-shirt yesterday. It said, "Kill the Rich."

    jailnotbail

    That's a little gauche. I prefer the 1970s expression of the same sentiment - "Eat the Rich."

    TrulyStupid

    It's time the American people stood up and took responsibility for their part in supporting there own exploitation. In their attempts to avoid footing the bill for outrageous spending, they have demanded lower taxes, lower interest rates and suported wasteful and immoral foreign wars. Start by changing yourselves.

    mark mchugh

    Know what the pivot point was for Wall Street?

    The 401(k) laws that went into effect January 1, 1980.

    That was the biggest, bestest bailout Wall Street ever got. For thirty years now, Americans have been throwing money at Wall Street and the biggest joke in the world is those "investments" have underperformed inflation and you still owe taxes on ALL of it (initial investment plus gain). This means inflation adjusted losses of more than 20%.

    And we're going to re-load this trade?

    Insanity: Doing the same thing over and over again and expecting different results.

    ~Einstein

    Ckierst1

    "It has become a oligarchic consumer capitalist society that is manipulated, in a deliberate and coordinated way, on a very large scale, through mass-marketing techniques, to the advantage of Wall Street and mega-corporations."

    "They are the Wall Street elite, corporate CEOs and the privileged classes that control the power in NYC and Washington DC."

    I don't disagree with main tenets of this piece. These people are criminal traitors and they and their protectors need to be punished. I disagree with calling it a form capitalism. I'm not fond of the term "crony capitalism" and its variants, because I think it muddies the water, contributes nothing to communication and permits propagandistic spin and confusion. It should be called what it is - mercantilism. An elite is benefitting and they beleive in big government to cover their actions, provide protection, propagandize, confuse and fail to properly inform the citizenry, and maintain control nationally and globally (stormtroopers). This ain't new folks. We've been at war with this impulse since the founding of the nation and we've been in the clutches of "big government" PTB for about 150 years - protosocialism and increasingly globalist socialism (progressivism). Leonard Cohen needs to ask "Which war?". Where is a jack hammer when you really need one? This shit needs to end and soon. We need real live laissez faire to re-center, determine real value and rebuild wealth. I suggest Austrian School economics.

    JLee2027
    - 10:55 #552940

    P.S. Faith has no place in discussions of markets, law, economics, or finance.

    One guess who decided that only Gold and Silver are money, that fiat currency is an abomination and the other rules of economics. Economic rules that are as finely and carefully balanced as the fundamental forces of the universe.

    TruthHunter

    Wow! What a junkfest!

    Is that a president on that $100 bill, or your deity? I'm reminded of the Blood Sweat and Tears Song.

    It seems to be a common philosophy around here...

    "I swear there ain't no heaven and pray there ain't no hell"

    Whether in bed or on a pike, all psychopaths die uneasy!

    Morality and religion are difficult to separate, but the

    laws of cause and effect keep working.

    [April 21, 2009 ] A Crisis of Ethic Proportions

    economistsview.typepad.com

    John Bogle says "self-interest got out of hand":

    A Crisis of Ethic Proportions, by John Bogle, Commentary, WSJ: I recently received a letter from a Vanguard shareholder who described the global financial crisis as "a crisis of ethic proportions." Substituting "ethic" for "epic" is a fine turn of phrase, and it accurately places a heavy responsibility for the meltdown on a broad deterioration in traditional ethical standards. ... Relying on [the] "invisible hand," through which our self-interest advances the interests of society, we have depended on the marketplace and competition to create prosperity and well-being.

    But self-interest got out of hand. ... Dollars became the coin of the new realm. Unchecked market forces overwhelmed traditional standards of professional conduct, developed over centuries. ... We've moved from a society in which "there are some things that one simply does not do" to one in which "if everyone else is doing it, I can too." Business ethics and professional standards were lost in the shuffle. ... The old notion of trusting and being trusted ... came to be seen as a quaint relic of an era long gone.

    The proximate causes of the crisis are usually said to be easy credit, bankers' cavalier attitudes toward risk, "securitization"..., the extraordinary leverage built into the financial system by complex derivatives, and the failure of our regulators to do their job.

    But the larger cause was our failure to recognize the sea change in the nature of capitalism that was occurring right before our eyes. That change was the growth of giant business corporations and giant financial institutions controlled not by their owners in the "ownership society" of yore, but by agents of the owners, which created an "agency society."

    The managers of our public corporations came to place their interests ahead of the interests of their company's owners. ... The malfeasance and misjudgments by our corporate, financial and government leaders, declining ethical standards, and the failure of our new agency society reflect a failure of capitalism. ...

    What's to be done? We must work to establish a "fiduciary society," where manager/agents entrusted with managing other people's money are required -- by federal statute -- to place front and center the interests of the owners they are duty-bound to serve. The focus needs to be on long-term investment (rather than short-term speculation), appropriate due diligence in security selection, and ensuring that corporations are run in the interest of their owners. ... Making that happen will be no easy task.

    Rules will never cover everything, so ethics is part of the problem. But the solution to the agency problem has to come in large part from changing incentives so that the self-interest of the managers coincides with the interests of the people they represent. [Kahneman also talks about agency problems in a section I left out of the next post.]

    Posted by Mark Thoma on Tuesday, April 21, 2009 at 01:24 AM in Economics, Market Failure

    [April 21, 2009] The Professionals are not being Held Accountable

    April 21, 2009 | economistsview.typepad.com

    Michael Pomerleano at Martin Wolf's Economist's Forum calls for more accountability:

    The crisis: holding the professionals to account, by Michael Pomerleano, Economists' Forum: My education (Harvard Business School and economics department) and professional experience prime me to advocate finance's role in the growth of economies. ... However, the conduct of professionals in the financial crisis leads me to reassess these beliefs. ...

    In this context,... the professionals are not being held accountable. As Viral V. Acharya and Rangarajan Sundaram point out: "The US recapitalization scheme ... is ... generous to the banks in that it imposes little direct discipline in the form of replacement of top management or curbs on executive pay, and secures no voting rights for the government".

    We seem to forget one of the successful lessons from the late 1980s savings and loan crisis in structuring positive and negative incentives: holding accountable the directors and officers, lawyers, accountants of the banks, investment banks and the rating agencies. ... The Office of Thrift Supervision, which regulates the US's thrifts, and its sister agency, the Resolution Trust Corp which was in charge of disposing of the assets of failed S&Ls, embarked on a deliberate deterrence strategy targeting lawyers, accountants, directors and officers of failed thrifts that aided and abetted the excesses leading to the S&L crisis. The intent was to discourage futures abuses and recover some of the lost taxpayer funds. ...

    In the US, we are told that there are no culprits in the crisis. The attitude of the policy makers, regulators, bankers and traders involved in the crisis is virtually fatalistic, treating the crisis as an inevitable "force majeure". All of them were observers and "no one saw it coming". In short, the crisis is a Lemony Snicket's "Series of Unfortunate Events".

    In reality the regulators that should have kept a close eye on the rapid growth of the shadow banking system were complacent, and the boards did not have the background in the industry and didn't understand the risks. It is clear that the policy makers and regulators lack the moral authority to lead us out of the crisis. ...

    The US Treasury plans to rely on the same firms and people that were involved in leading to the crisis to get us out of it. ... Clearly, nothing learned, nothing gained from the S&L crisis or the Swedish experience. Maybe this will change.

    Saying it's not your fault you crashed the ship into the rock because the rock was underwater and hidden - nobody could have seen it coming - loses its force when you are navigating in waters that are known to be rocky. Even if you have the latest sonar based upon fancy, innovative math that is supposed to detect the rock before you hit it, and even if regulators were supposed to clearly map and mark all danger, if you hit it anyway, there's a reason why captains are expected to go down with - or at best be the last ones off - the ship. It ensures they'll do all they can to avoid hitting it in the first place.

    Posted by Mark Thoma on Tuesday, April 21, 2009 at 06:57 PM in Economics, Financial System, Regulation

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    US economics One big Ponzi scheme

    Al Jazeera English

    Thank you, Bernie, for breaking your silence - even if you are still clinging to that cover-up mode you adopted since you took the entirety of the blame for your crimes.

    What is clear is that ripping off the rich is punished far more severely than ripping off the poor. The lengthy sentence you were given spared countless other greedsters and goniffs from facing the music - what music there is.

    In an interview - with a reporter from The New York Times who is writing a book to cash in on a man who has already cashed out - we learn, in the vaguest terms, that Mr M believes the banks he did his crooked business with "should have known" his figures did not figure. Keeping with the deceit that has served him well over the years, he names no names.

    That said, how right he may be. There were many who should have known and done something about it. The Securities and Exchange Commission (SEC) and other regulators for one. Perhaps The New York Times for another. Remember, it was Madoff's confession to his sons that started him on his way to his new 12' x 12' home from home - in a federal correctional institute, where he may dream of his seized penthouse, homes and yachts - rather than any press expose.

    For years, he went undetected by business journalists, who knew - or should have known - what he was up to. There are even questions about the speed with which he was sentenced, preventing him from being tried - a process which, through diligent cross-examination, would have brought us more information on the details of his dirty deals.

    Do not believe all you read

    Even The New York Times interview is being disputed, reports the New York Post: "The trustee representing thousands of Bernard Madoff's victims disputed a report that he personally grilled the Ponzi monster in prison."

    "There has been no direct communication between them," said David Sheehan, the chief counsel for the court-appointed trustee, Irving Picard, after The New York Times reported that Picard and Madoff had met over the summer.

    "The Times later changed a quote from Madoff and altered some text online that had implied Picard personally visited Bernie in the Butner, NC, lockup where he is serving a 150-year sentence. Picard did not dispute that his legal team met with Madoff."

    Madoff is also still not coming clean about the web of alliances he had internationally, as well as in New York. We live in a global economy after all. We now know of Swiss and Austrian connections - but what about Israel, where this ingratiating handler was well known for his connections with Jewish philanthropists and institutions? So far, that story has yet to be told.

    At the same time, the people investigating Madoff are making a small fortune. According to the Financial Times: "The army of lawyers and consultants helping to recover funds from Bernard Madoff's $19.6bn fraud stand to earn more than $1.3bn in fees, according to new figures that detail the cost of liquidating the huge Ponzi scheme."

    The comments of readers to The Times appear to be more insightful than the paper's own reports. Here is one from Texas: "I actually, sort of, feel sorry for this man. He was just doing what many investment firms were doing at the same time. He has been imprisoned as a scapegoat - yet many people since then - and to this day - are doing the same thing. Where are the indictments against the thousands of other people who did the same thing - and knowingly led this country into financial disaster?"

    Banks close ranks

    The best reporting on this subject is not in the mainstream press but in a music magazine, Rolling Stone, where Matt Taibbi investigates why the whole of Wall Street is not in jail: "Financial crooks brought down the world's economy - but the feds are doing more to protect them than to prosecute them," he charges.

    Madoff also believes the banks who serviced him did not want to know about his Ponzi scheme which, unfortunately, is probably true - and an attitude coming not just from the banks.

    The Times report added: "He spoke with great intensity and fluency about his dealings with various banks and hedge funds, pointing to their 'willful blindness' and their failure to examine discrepancies between his regulatory filings and other information available to them.

    "'They had to know,' Mr Madoff said. 'But the attitude was sort of: "If you're doing something wrong, we don't want to know."'"

    Yves Smith of NakedCapitalism.com quips: "This sounds credible - but it also seems more than a tad self-serving."

    Andrew Leonard asks in Salon: "Should we trust him? After all, if there is one thing we know about Bernie Madoff, it is that he is one hell of a liar. But as evidence emerges that bank executives were exchanging emails wondering about Madoff's amazing investment record, the possibility that the banks were purposefully looking the other way is not inconceivable."

    The truth is that many of us still do not really want to know - because, if we did, we would have to do something about it.

    By their actions, both Democrats and Republicans clearly appear to prefer the most simplistic understandings - or misunderstandings.

    The Financial Crisis Inquiry Commission (FCIC), like the 9/11 and Warren Commissions before it, avoided key issues. The FCIC inquiry did not call for a criminal indictment of wrongdoers. While informative, its report was ultimately a dud - telling us mostly what we knew, although there were some disclosures that our tepid press still missed.

    Now the Republicans want to water down the regulations on derivatives in the Dodd-Frank financial 'reform' legislation, claiming they will lead to a loss of jobs. This is predictable: Every effort to defend big business is always couched in terms of helping the public.

    The New York Times reported: "Representative Stephen Lynch, Democrat of Massachusetts, warned: 'You think regulation is costly? How about the $7trillion we just lost from not regulating the derivatives markets?'"

    There was no response from his colleagues.

    So who will do anything about it?

    The political right prefers to change the subject, while the left does not seem to have the time or energy to make economic justice its principal concern - even as polls show the economy is the number one problem for most in the US.

    Progressives should hang their heads in shame at the minimal amount of activism taking place against the banks and the escalating numbers of foreclosures. Homes and hope are being stolen from people for whom the term "depression" now has a personal, as well as economic, meaning.

    The other day, economist Jeff Sachs - who has a lot of atoning to do for his own misguided, destructive economic advice to Russia after the fall of the Soviet Union - warned that little is being done about economic inequity and the growing ranks of the poor in the US. He asks if people who run things in the US want "another Egypt". He is a policy wonk, not an activist - and likely fears the idea.

    Many activists say they want to emulate the Egyptians, but who will organise anything as effective - even in a land that used to be known for people's movements - to raise hell? In Egypt, young people used the internet to organise and mobilise for change. In the US, the internet seems to function more as an escape valve, consuming hours of our time and giving us another way to talk to each other - and ventilate against the government. Social media here seems to be more for socialising.

    The government supports internet freedom abroad - but restricts it and spies on it at home. Obama has already supported a law allowing him to shut it down here in a national emergency.

    The passivity of the public is one result of the inundation by middle-of-the-road media and effective information deprivation.

    As Noam Chomsky puts it:

    "The population in the United States is angry, frustrated and full of fear and irrational hatreds. And the folks not far from you on Wall Street are just doing fine. They're the ones who created the current crisis. They're the ones who were called upon to deal with it. They're coming out stronger and richer than ever. But everything's fine - as long as the population is passive."

    That is our problem, Bernie. Even if the people want to know, it is not that easy to find out. Let us thank the media and our government for that.

    News dissector Danny Schechter edits Mediachannel.org. His new film, Plunder: The Crime of Our Time, tells the story of the financial crisis as a criminal tale. He can be reached at: [email protected]

    The views expressed in this article are the author's own and do not necessarily reflect Al Jazeera's editorial policy.

    Bill Moyers Journal

    April 3, 2009 | PBS

    BILL MOYERS: Welcome to the Journal.

    For months now, revelations of the wholesale greed and blatant transgressions of Wall Street have reminded us that "The Best Way to Rob a Bank Is to Own One." In fact, the man you're about to meet wrote a book with just that title. It was based upon his experience as a tough regulator during one of the darkest chapters in our financial history: the savings and loan scandal in the late 1980s.

    WILLIAM K. BLACK: These numbers as large as they are, vastly understate the problem of fraud.

    BILL MOYERS: Bill Black was in New York this week for a conference at the John Jay College of Criminal Justice where scholars and journalists gathered to ask the question, "How do they get away with it?" Well, no one has asked that question more often than Bill Black.

    The former Director of the Institute for Fraud Prevention now teaches Economics and Law at the University of Missouri, Kansas City. During the savings and loan crisis, it was Black who accused then-house speaker Jim Wright and five US Senators, including John Glenn and John McCain, of doing favors for the S&L's in exchange for contributions and other perks. The senators got off with a slap on the wrist, but so enraged was one of those bankers, Charles Keating - after whom the senate's so-called "Keating Five" were named - he sent a memo that read, in part, "get Black - kill him dead." Metaphorically, of course. Of course.

    Now Black is focused on an even greater scandal, and he spares no one - not even the President he worked hard to elect, Barack Obama. But his main targets are the Wall Street barons, heirs of an earlier generation whose scandalous rip-offs of wealth back in the 1930s earned them comparison to Al Capone and the mob, and the nickname "banksters."

    Bill Black, welcome to the Journal.

    WILLIAM K. BLACK: Thank you.

    BILL MOYERS: I was taken with your candor at the conference here in New York to hear you say that this crisis we're going through, this economic and financial meltdown is driven by fraud. What's your definition of fraud?

    WILLIAM K. BLACK: Fraud is deceit. And the essence of fraud is, "I create trust in you, and then I betray that trust, and get you to give me something of value." And as a result, there's no more effective acid against trust than fraud, especially fraud by top elites, and that's what we have.

    BILL MOYERS: In your book, you make it clear that calculated dishonesty by people in charge is at the heart of most large corporate failures and scandals, including, of course, the S&L, but is that true? Is that what you're saying here, that it was in the boardrooms and the CEO offices where this fraud began?

    WILLIAM K. BLACK: Absolutely.

    BILL MOYERS: How did they do it? What do you mean?

    WILLIAM K. BLACK: Well, the way that you do it is to make really bad loans, because they pay better. Then you grow extremely rapidly, in other words, you're a Ponzi-like scheme. And the third thing you do is we call it leverage. That just means borrowing a lot of money, and the combination creates a situation where you have guaranteed record profits in the early years. That makes you rich, through the bonuses that modern executive compensation has produced. It also makes it inevitable that there's going to be a disaster down the road.

    BILL MOYERS: So you're suggesting, saying that CEOs of some of these banks and mortgage firms in order to increase their own personal income, deliberately set out to make bad loans?

    WILLIAM K. BLACK: Yes.

    BILL MOYERS: How do they get away with it? I mean, what about their own checks and balances in the company? What about their accounting divisions?

    WILLIAM K. BLACK: All of those checks and balances report to the CEO, so if the CEO goes bad, all of the checks and balances are easily overcome. And the art form is not simply to defeat those internal controls, but to suborn them, to turn them into your greatest allies. And the bonus programs are exactly how you do that.

    BILL MOYERS: If I wanted to go looking for the parties to this, with a good bird dog, where would you send me?

    WILLIAM K. BLACK: Well, that's exactly what hasn't happened. We haven't looked, all right? The Bush Administration essentially got rid of regulation, so if nobody was looking, you were able to do this with impunity and that's exactly what happened. Where would you look? You'd look at the specialty lenders. The lenders that did almost all of their work in the sub-prime and what's called Alt-A, liars' loans.

    BILL MOYERS: Yeah. Liars' loans--

    WILLIAM K. BLACK: Liars' loans.

    BILL MOYERS: Why did they call them liars' loans?

    WILLIAM K. BLACK: Because they were liars' loans.

    BILL MOYERS: And they knew it?

    WILLIAM K. BLACK: They knew it. They knew that they were frauds.

    WILLIAM K. BLACK: Liars' loans mean that we don't check. You tell us what your income is. You tell us what your job is. You tell us what your assets are, and we agree to believe you. We won't check on any of those things. And by the way, you get a better deal if you inflate your income and your job history and your assets.

    BILL MOYERS: You think they really said that to borrowers?

    WILLIAM K. BLACK: We know that they said that to borrowers. In fact, they were also called, in the trade, ninja loans.

    BILL MOYERS: Ninja?

    WILLIAM K. BLACK: Yeah, because no income verification, no job verification, no asset verification.

    BILL MOYERS: You're talking about significant American companies.

    WILLIAM K. BLACK: Huge! One company produced as many losses as the entire Savings and Loan debacle.

    BILL MOYERS: Which company?

    WILLIAM K. BLACK: IndyMac specialized in making liars' loans. In 2006 alone, it sold $80 billion dollars of liars' loans to other companies. $80 billion.

    BILL MOYERS: And was this happening exclusively in this sub-prime mortgage business?

    WILLIAM K. BLACK: No, and that's a big part of the story as well. Even prime loans began to have non-verification. Even Ronald Reagan, you know, said, "Trust, but verify." They just gutted the verification process. We know that will produce enormous fraud, under economic theory, criminology theory, and two thousand years of life experience.

    BILL MOYERS: Is it possible that these complex instruments were deliberately created so swindlers could exploit them?

    WILLIAM K. BLACK: Oh, absolutely. This stuff, the exotic stuff that you're talking about was created out of things like liars' loans, that were known to be extraordinarily bad. And now it was getting triple-A ratings. Now a triple-A rating is supposed to mean there is zero credit risk. So you take something that not only has significant, it has crushing risk. That's why it's toxic. And you create this fiction that it has zero risk. That itself, of course, is a fraudulent exercise. And again, there was nobody looking, during the Bush years. So finally, only a year ago, we started to have a Congressional investigation of some of these rating agencies, and it's scandalous what came out. What we know now is that the rating agencies never looked at a single loan file. When they finally did look, after the markets had completely collapsed, they found, and I'm quoting Fitch, the smallest of the rating agencies, "the results were disconcerting, in that there was the appearance of fraud in nearly every file we examined."

    BILL MOYERS: So if your assumption is correct, your evidence is sound, the bank, the lending company, created a fraud. And the ratings agency that is supposed to test the value of these assets knowingly entered into the fraud. Both parties are committing fraud by intention.

    WILLIAM K. BLACK: Right, and the investment banker that - we call it pooling - puts together these bad mortgages, these liars' loans, and creates the toxic waste of these derivatives. All of them do that. And then they sell it to the world and the world just thinks because it has a triple-A rating it must actually be safe. Well, instead, there are 60 and 80 percent losses on these things, because of course they, in reality, are toxic waste.

    BILL MOYERS: You're describing what Bernie Madoff did to a limited number of people. But you're saying it's systemic, a systemic Ponzi scheme.

    WILLIAM K. BLACK: Oh, Bernie was a piker. He doesn't even get into the front ranks of a Ponzi scheme...

    BILL MOYERS: But you're saying our system became a Ponzi scheme.

    WILLIAM K. BLACK: Our system...

    BILL MOYERS: Our financial system...

    WILLIAM K. BLACK: Became a Ponzi scheme. Everybody was buying a pig in the poke. But they were buying a pig in the poke with a pretty pink ribbon, and the pink ribbon said, "Triple-A."

    BILL MOYERS: Is there a law against liars' loans?

    WILLIAM K. BLACK: Not directly, but there, of course, many laws against fraud, and liars' loans are fraudulent.

    BILL MOYERS: Because...

    WILLIAM K. BLACK: Because they're not going to be repaid and because they had false representations. They involve deceit, which is the essence of fraud.

    BILL MOYERS: Why is it so hard to prosecute? Why hasn't anyone been brought to justice over this?

    WILLIAM K. BLACK: Because they didn't even begin to investigate the major lenders until the market had actually collapsed, which is completely contrary to what we did successfully in the Savings and Loan crisis, right? Even while the institutions were reporting they were the most profitable savings and loan in America, we knew they were frauds. And we were moving to close them down. Here, the Justice Department, even though it very appropriately warned, in 2004, that there was an epidemic...

    BILL MOYERS: Who did?

    WILLIAM K. BLACK: The FBI publicly warned, in September 2004 that there was an epidemic of mortgage fraud, that if it was allowed to continue it would produce a crisis at least as large as the Savings and Loan debacle. And that they were going to make sure that they didn't let that happen. So what goes wrong? After 9/11, the attacks, the Justice Department transfers 500 white-collar specialists in the FBI to national terrorism. Well, we can all understand that. But then, the Bush administration refused to replace the missing 500 agents. So even today, again, as you say, this crisis is 1000 times worse, perhaps, certainly 100 times worse, than the Savings and Loan crisis. There are one-fifth as many FBI agents as worked the Savings and Loan crisis.

    BILL MOYERS: You talk about the Bush administration. Of course, there's that famous photograph of some of the regulators in 2003, who come to a press conference with a chainsaw suggesting that they're going to slash, cut business loose from regulation, right?

    WILLIAM K. BLACK: Well, they succeeded. And in that picture, by the way, the other - three of the other guys with pruning shears are the...

    BILL MOYERS: That's right.

    WILLIAM K. BLACK: They're the trade representatives. They're the lobbyists for the bankers. And everybody's grinning. The government's working together with the industry to destroy regulation. Well, we now know what happens when you destroy regulation. You get the biggest financial calamity of anybody under the age of 80.

    BILL MOYERS: But I can point you to statements by Larry Summers, who was then Bill Clinton's Secretary of the Treasury, or the other Clinton Secretary of the Treasury, Rubin. I can point you to suspects in both parties, right?

    WILLIAM K. BLACK: There were two really big things, under the Clinton administration. One, they got rid of the law that came out of the real-world disasters of the Great Depression. We learned a lot of things in the Great Depression. And one is we had to separate what's called commercial banking from investment banking. That's the Glass-Steagall law. But we thought we were much smarter, supposedly. So we got rid of that law, and that was bipartisan. And the other thing is we passed a law, because there was a very good regulator, Brooksley Born, that everybody should know about and probably doesn't. She tried to do the right thing to regulate one of these exotic derivatives that you're talking about. We call them C.D.F.S. And Summers, Rubin, and Phil Gramm came together to say not only will we block this particular regulation. We will pass a law that says you can't regulate. And it's this type of derivative that is most involved in the AIG scandal. AIG all by itself, cost the same as the entire Savings and Loan debacle.

    BILL MOYERS: What did AIG contribute? What did they do wrong?

    WILLIAM K. BLACK: They made bad loans. Their type of loan was to sell a guarantee, right? And they charged a lot of fees up front. So, they booked a lot of income. Paid enormous bonuses. The bonuses we're thinking about now, they're much smaller than these bonuses that were also the product of accounting fraud. And they got very, very rich. But, of course, then they had guaranteed this toxic waste. These liars' loans. Well, we've just gone through why those toxic waste, those liars' loans, are going to have enormous losses. And so, you have to pay the guarantee on those enormous losses. And you go bankrupt. Except that you don't in the modern world, because you've come to the United States, and the taxpayers play the fool. Under Secretary Geithner and under Secretary Paulson before him... we took $5 billion dollars, for example, in U.S. taxpayer money. And sent it to a huge Swiss Bank called UBS. At the same time that that bank was defrauding the taxpayers of America. And we were bringing a criminal case against them. We eventually get them to pay a $780 million fine, but wait, we gave them $5 billion. So, the taxpayers of America paid the fine of a Swiss Bank. And why are we bailing out somebody who that is defrauding us?

    BILL MOYERS: And why...

    WILLIAM K. BLACK: How mad is this?

    BILL MOYERS: What is your explanation for why the bankers who created this mess are still calling the shots?

    WILLIAM K. BLACK: Well, that, especially after what's just happened at G.M., that's... it's scandalous.

    BILL MOYERS: Why are they firing the president of G.M. and not firing the head of all these banks that are involved?

    WILLIAM K. BLACK: There are two reasons. One, they're much closer to the bankers. These are people from the banking industry. And they have a lot more sympathy. In fact, they're outright hostile to autoworkers, as you can see. They want to bash all of their contracts. But when they get to banking, they say, ‘contracts, sacred.' But the other element of your question is we don't want to change the bankers, because if we do, if we put honest people in, who didn't cause the problem, their first job would be to find the scope of the problem. And that would destroy the cover up.

    BILL MOYERS: The cover up?

    WILLIAM K. BLACK: Sure. The cover up.

    BILL MOYERS: That's a serious charge.

    WILLIAM K. BLACK: Of course.

    BILL MOYERS: Who's covering up?

    WILLIAM K. BLACK: Geithner is charging, is covering up. Just like Paulson did before him. Geithner is publicly saying that it's going to take $2 trillion - a trillion is a thousand billion - $2 trillion taxpayer dollars to deal with this problem. But they're allowing all the banks to report that they're not only solvent, but fully capitalized. Both statements can't be true. It can't be that they need $2 trillion, because they have masses losses, and that they're fine.

    These are all people who have failed. Paulson failed, Geithner failed. They were all promoted because they failed, not because...

    BILL MOYERS: What do you mean?

    WILLIAM K. BLACK: Well, Geithner has, was one of our nation's top regulators, during the entire subprime scandal, that I just described. He took absolutely no effective action. He gave no warning. He did nothing in response to the FBI warning that there was an epidemic of fraud. All this pig in the poke stuff happened under him. So, in his phrase about legacy assets. Well he's a failed legacy regulator.

    BILL MOYERS: But he denies that he was a regulator. Let me show you some of his testimony before Congress. Take a look at this.

    TIMOTHY GEITHNER:I've never been a regulator, for better or worse. And I think you're right to say that we have to be very skeptical that regulation can solve all of these problems. We have parts of our system that are overwhelmed by regulation.

    Overwhelmed by regulation! It wasn't the absence of regulation that was the problem, it was despite the presence of regulation you've got huge risks that build up.

    WILLIAM K. BLACK: Well, he may be right that he never regulated, but his job was to regulate. That was his mission statement.

    BILL MOYERS: As?

    WILLIAM K. BLACK: As president of the Federal Reserve Bank of New York, which is responsible for regulating most of the largest bank holding companies in America. And he's completely wrong that we had too much regulation in some of these areas. I mean, he gives no details, obviously. But that's just plain wrong.

    BILL MOYERS: How is this happening? I mean why is it happening?

    WILLIAM K. BLACK: Until you get the facts, it's harder to blow all this up. And, of course, the entire strategy is to keep people from getting the facts.

    BILL MOYERS: What facts?

    WILLIAM K. BLACK: The facts about how bad the condition of the banks is. So, as long as I keep the old CEO who caused the problems, is he going to go vigorously around finding the problems? Finding the frauds?

    BILL MOYERS: You--

    WILLIAM K. BLACK: Taking away people's bonuses?

    BILL MOYERS: To hear you say this is unusual because you supported Barack Obama, during the campaign. But you're seeming disillusioned now.

    WILLIAM K. BLACK: Well, certainly in the financial sphere, I am. I think, first, the policies are substantively bad. Second, I think they completely lack integrity. Third, they violate the rule of law. This is being done just like Secretary Paulson did it. In violation of the law. We adopted a law after the Savings and Loan crisis, called the Prompt Corrective Action Law. And it requires them to close these institutions. And they're refusing to obey the law.

    BILL MOYERS: In other words, they could have closed these banks without nationalizing them?

    WILLIAM K. BLACK: Well, you do a receivership. No one -- Ronald Reagan did receiverships. Nobody called it nationalization.

    BILL MOYERS: And that's a law?

    WILLIAM K. BLACK: That's the law.

    BILL MOYERS: So, Paulson could have done this? Geithner could do this?

    WILLIAM K. BLACK: Not could. Was mandated--

    BILL MOYERS: By the law.

    WILLIAM K. BLACK: By the law.

    BILL MOYERS: This law, you're talking about.

    WILLIAM K. BLACK: Yes.

    BILL MOYERS: What the reason they give for not doing it?

    WILLIAM K. BLACK: They ignore it. And nobody calls them on it.

    BILL MOYERS: Well, where's Congress? Where's the press? Where--

    WILLIAM K. BLACK: Well, where's the Pecora investigation?

    BILL MOYERS: The what?

    WILLIAM K. BLACK: The Pecora investigation. The Great Depression, we said, "Hey, we have to learn the facts. What caused this disaster, so that we can take steps, like pass the Glass-Steagall law, that will prevent future disasters?" Where's our investigation?

    What would happen if after a plane crashes, we said, "Oh, we don't want to look in the past. We want to be forward looking. Many people might have been, you know, we don't want to pass blame. No. We have a nonpartisan, skilled inquiry. We spend lots of money on, get really bright people. And we find out, to the best of our ability, what caused every single major plane crash in America. And because of that, aviation has an extraordinarily good safety record. We ought to follow the same policies in the financial sphere. We have to find out what caused the disasters, or we will keep reliving them. And here, we've got a double tragedy. It isn't just that we are failing to learn from the mistakes of the past. We're failing to learn from the successes of the past.

    BILL MOYERS: What do you mean?

    WILLIAM K. BLACK: In the Savings and Loan debacle, we developed excellent ways for dealing with the frauds, and for dealing with the failed institutions. And for 15 years after the Savings and Loan crisis, didn't matter which party was in power, the U.S. Treasury Secretary would fly over to Tokyo and tell the Japanese, "You ought to do things the way we did in the Savings and Loan crisis, because it worked really well. Instead you're covering up the bank losses, because you know, you say you need confidence. And so, we have to lie to the people to create confidence. And it doesn't work. You will cause your recession to continue and continue." And the Japanese call it the lost decade. That was the result. So, now we get in trouble, and what do we do? We adopt the Japanese approach of lying about the assets. And you know what? It's working just as well as it did in Japan.

    BILL MOYERS: Yeah. Are you saying that Timothy Geithner, the Secretary of the Treasury, and others in the administration, with the banks, are engaged in a cover up to keep us from knowing what went wrong?

    WILLIAM K. BLACK: Absolutely.

    BILL MOYERS: You are.

    WILLIAM K. BLACK: Absolutely, because they are scared to death. All right? They're scared to death of a collapse. They're afraid that if they admit the truth, that many of the large banks are insolvent. They think Americans are a bunch of cowards, and that we'll run screaming to the exits. And we won't rely on deposit insurance. And, by the way, you can rely on deposit insurance. And it's foolishness. All right? Now, it may be worse than that. You can impute more cynical motives. But I think they are sincerely just panicked about, "We just can't let the big banks fail." That's wrong.

    BILL MOYERS: But what might happen, at this point, if in fact they keep from us the true health of the banks?

    WILLIAM K. BLACK: Well, then the banks will, as they did in Japan, either stay enormously weak, or Treasury will be forced to increasingly absurd giveaways of taxpayer money. We've seen how horrific AIG -- and remember, they kept secrets from everyone.

    BILL MOYERS: A.I.G. did?

    WILLIAM K. BLACK: What we're doing with -- no, Treasury and both administrations. The Bush administration and now the Obama administration kept secret from us what was being done with AIG. AIG was being used secretly to bail out favored banks like UBS and like Goldman Sachs. Secretary Paulson's firm, that he had come from being CEO. It got the largest amount of money. $12.9 billion. And they didn't want us to know that. And it was only Congressional pressure, and not Congressional pressure, by the way, on Geithner, but Congressional pressure on AIG.

    Where Congress said, "We will not give you a single penny more unless we know who received the money." And, you know, when he was Treasury Secretary, Paulson created a recommendation group to tell Treasury what they ought to do with AIG. And he put Goldman Sachs on it.

    BILL MOYERS: Even though Goldman Sachs had a big vested stake.

    WILLIAM K. BLACK: Massive stake. And even though he had just been CEO of Goldman Sachs before becoming Treasury Secretary. Now, in most stages in American history, that would be a scandal of such proportions that he wouldn't be allowed in civilized society.

    BILL MOYERS: Yeah, like a conflict of interest, it seems.

    WILLIAM K. BLACK: Massive conflict of interests.

    BILL MOYERS: So, how did he get away with it?

    WILLIAM K. BLACK: I don't know whether we've lost our capability of outrage. Or whether the cover up has been so successful that people just don't have the facts to react to it.

    BILL MOYERS: Who's going to get the facts?

    WILLIAM K. BLACK: We need some chairmen or chairwomen--

    BILL MOYERS: In Congress.

    WILLIAM K. BLACK: --in Congress, to hold the necessary hearings. And we can blast this out. But if you leave the failed CEOs in place, it isn't just that they're terrible business people, though they are. It isn't just that they lack integrity, though they do. Because they were engaged in these frauds. But they're not going to disclose the truth about the assets.

    BILL MOYERS: And we have to know that, in order to know what?

    WILLIAM K. BLACK: To know everything. To know who committed the frauds. Whose bonuses we should recover. How much the assets are worth. How much they should be sold for. Is the bank insolvent, such that we should resolve it in this way? It's the predicate, right? You need to know the facts to make intelligent decisions. And they're deliberately leaving in place the people that caused the problem, because they don't want the facts. And this is not new. The Reagan Administration's central priority, at all times, during the Savings and Loan crisis, was covering up the losses.

    BILL MOYERS: So, you're saying that people in power, political power, and financial power, act in concert when their own behinds are in the ringer, right?

    WILLIAM K. BLACK: That's right. And it's particularly a crisis that brings this out, because then the class of the banker says, "You've got to keep the information away from the public or everything will collapse. If they understand how bad it is, they'll run for the exits."

    BILL MOYERS: Yeah, and this week in New York, at this conference, you described this as more than a financial crisis. You called it a moral crisis.

    WILLIAM K. BLACK: Yes.

    BILL MOYERS: Why?

    WILLIAM K. BLACK: Because it is a fundamental lack of integrity. But also because, if you look back at crises, an economist who is also a presidential appointee, as a regulator in the Savings and Loan industry, right here in New York, Larry White, wrote a book about the Savings and Loan crisis. And he said, you know, one of the most interesting questions is why so few people engaged in fraud? Because objectively, you could have gotten away with it. But only about ten percent of the CEOs, engaged in fraud. So, 90 percent of them were restrained by ethics and integrity. So, far more than law or by F.B.I. agents, it's our integrity that often prevents the greatest abuses. And what we had in this crisis, instead of the Savings and Loan, is the most elite institutions in America engaging or facilitating fraud.

    BILL MOYERS: This wound that you say has been inflicted on American life. The loss of worker's income. And security and pensions and future happened, because of the misconduct of a relatively few, very well-heeled people, in very well-decorated corporate suites, right?

    WILLIAM K. BLACK: Right.

    BILL MOYERS: It was relatively a handful of people.

    WILLIAM K. BLACK: And their ideologies, which swept away regulation. So, in the example, regulation means that cheaters don't prosper. So, instead of being bad for capitalism, it's what saves capitalism. "Honest purveyors prosper" is what we want. And you need regulation and law enforcement to be able to do this. The tragedy of this crisis is it didn't need to happen at all.

    BILL MOYERS: When you wake in the middle of the night, thinking about your work, what do you make of that? What do you tell yourself?

    WILLIAM K. BLACK: There's a saying that we took great comfort in. It's actually by the Dutch, who were fighting this impossible war for independence against what was then the most powerful nation in the world, Spain. And their motto was, "It is not necessary to hope in order to persevere."

    Now, going forward, get rid of the people that have caused the problems. That's a pretty straightforward thing, as well. Why would we keep CEOs and CFOs and other senior officers, that caused the problems? That's facially nuts. That's our current system.

    So stop that current system. We're hiding the losses, instead of trying to find out the real losses. Stop that, because you need good information to make good decisions, right? Follow what works instead of what's failed. Start appointing people who have records of success, instead of records of failure. That would be another nice place to start. There are lots of things we can do. Even today, as late as it is. Even though they've had a terrible start to the administration. They could change, and they could change within weeks. And by the way, the folks who are the better regulators, they paid their taxes. So, you can get them through the vetting process a lot quicker.

    BILL MOYERS: William Black, thank you very much for being with me on the Journal.

    WILLIAM K. BLACK: Thank you so much.

    [Apr 20, 2009] Self-Regulation Doesn't Work

    Apr 20, 2009 | Economist's View

    The last entry in the Blog War over regulation of the financial sector:

    Why Self-Regulation of the Financial System Won't Work, by Mark Thoma: I want to finish up by broadening the discussion beyond the regulation of hedge funds to the more general topic of how attitudes toward regulation have changed in recent years, how that helped to set the stage for the crisis we are in, and what we need to do to prevent it from happening again. In the process, I also want to take on Houman's point that regulators fell down on the job and let this crisis happen, so we cannot trust them in the future.

    As I described in my first post, after decades and decades of instability in the 1800s and early 1900s, followed by the massive bank failures of the early 1930s, regulations were imposed to stabilize the banking system. The result was sixty years of calm in the financial sector. That's hardly a failure of regulation. It wasn't until the shadow banking system began growing outside of the regulatory umbrella that problems began to reemerge. A central theme of the posts this week has been that bringing about another decades long period of relative stability will require the regulatory umbrella to be extended to cover all firms within both the traditional and non-traditional (or shadow) banking system, hedge funds included.

    I believe we made two regulatory mistakes that contributed to the present financial crisis. First, there was a push for deregulation beginning in the 1970s based upon the belief that markets are self-regulating - even to the extent of self-repairing market failures - and that caused us to go too far toward deregulation. Even the regulation that was left in place was, in many cases, not enforced vigorously, and there was little chance of new, substantial regulatory changes being put in place to match the changes in the financial marketplace brought about by rapid financial innovation. In some cases, deregulation was needed, but in many other cases the deregulation went much too far.

    Second, we didn't focus enough on macroeconomic stability. I think we came to believe that a large crash of the economy was extremely unlikely, particularly one driven by problems in the financial sector. Several factors were responsible for this. The transformative financial innovation of recent decades - particularly the slicing and dicing (securitization) of mortgages and other assets into many complex financial products - was supposed to distribute risk broadly and prevent collapse. We had the "Great Moderation" after the mid 1980s when the variability of output fell significantly and inflation stabilized at low levels, and this was widely attributed to the skill of policymakers and the deregulation of the economy. Because policy had improved, and because we believed the economy was more stable due to deregulation, we let our guard down. We continued to recognize that garden variety fluctuations in output were still possible, though we thought the Fed could mostly handle those, but big crashes were a thing of the past. Or so we thought.

    Hopefully, we have been adequately reminded that large recessions can still happen, and that will motivate us to take the regulatory steps needed to bring more stability to the financial system. Some people argue that any new regulation needs to wait until the financial sector has re-stabilized to avoid creating another source of uncertainty, a view that has merit. But the will and hence our ability to impose new regulation tends to diminish when the economy recovers, and if we wait too long to get started, the opposition to any new regulation may carry the day and we'll fail to get the measures we need put into place. The time to start is now.

    But what of the charge that regulators blew it and caused this crisis, and therefore we are foolish to rely upon them for stability in the future? First, as I've said, I don't think decades of stability is a failure by any definition, and the recent failure was driven by an ideological belief that markets are self-regulating and hence best left alone. Most markets can be left alone, but as Alan Greenspan has recently acknowledged, financial markets are not among them. Second, I believe the recent failure did not happen because regulators were incapable of doing better than they did, it was their belief in the self-healing power of markets - their belief that what just happened was next to impossible - that stopped them from intervening as needed. With different beliefs and a different framework for approaching the problem, the outcome is much different.

    So I am not ready to throw up my hands and say this is too hard, either the private sector finds a way to take care of itself, or it doesn't get done at all. We have the capacity to learn from our mistakes, to drop ideologies and theoretical constructs that led us astray, and I have faith we will do just that (Alan Greenspan's conversion is a prime example). With comprehensive regulation to prevent the excesses that caused the problems we are having, with the flexibility for regulations to evolve as new innovations come to the financial marketplace, and with regulators who have learned the lessons of the past, we can look forward to another decades long period of stability. But if we fail to take the steps that are needed and rely too much on private markets to regulate themselves, we are setting ourselves up for this to happen again.

    Houman's response is here (it's partly in response to the previous post).

    Posted by Mark Thoma on Monday, April 20, 2009 at 02:07 AM in Economics, Politics, Regulation

    Permalink TrackBack (1) Comments (66)

    Lafayette says...

    Well-written, well-balanced article, MT.

    I fear, nonetheless, that it overlooks a key factor at the cause of the Great Subprime Mess of 2008. That is, human failure.

    The Subprime Mess was a Perfect Storm of many confluent factors, but underlying them all was human inadequacy. Whether our deficiency was a matter of laxity or vanity or cupidity, doesn't solve the central issue, which is failure on such as scale as to cause great economic deprivation.

    To think that changing Wall Street's infrastructure (as Shadab does) will change human behaviour is seriously naive. (Though the notion that finance boutiques will have better risk management because one's own wealth is committed, is an enticing argument.) We humans are clever beings, which is why we dominate this planet.

    Should we not look at regulating behaviour more than markets? Perhaps we need more/better (regulatory) stop-signs on the road, but surely we need better-behaved drivers (risk managers) at the wheel.

    I maintain, as I have for some time, that only confiscatory taxation, beyond a "reasonable level" of total compensation, will change human behaviour. We must take the motivation out of unacceptable human behaviour, regardless of its endeavor.

    Let us not forget that grabbing for the Golden Ring was perfectly legal. Commercial lenders and Investment Bankers, responsible for the excesses, were not only taking advantage of regulatory laxity but pushing the envelope of Risk Management into uncharted waters. Why? Because success would bring them pecuniary rewards beyond the wildest imagination.

    If we do not change such practices, by both more forceful punishment of contra-regulatory activity and higher marginal rates of taxation, then the cunning creatures on Wall Street will simply devise new ways to beat conventional wisdom in the race to the treasure at the end of the rainbow.

    This will not happen next year or within the next decade, but neither will it take another 75 years (which the Subprime Mess needed to repeat the Great Depression). It will come not within three or four generations either, but perhaps only two, because such convulsive evolutions may have accelerated enormously due to the amplitude effects of globalization.

    Meaning within the lifetimes or our children.

    Oupoot says...

    IMHO, the starting point would be to relook at the economic theory underlying regulation. The theory of self-regulation was promoted almost exclusively in most grad schools. The theory I learned in micro-economics in grad school was that market agents (firms/individuals) will discount any adverse future event in the n'th iteration of an iterative game process to the present, which will guide their decisions in the 1st iteration. The assumption was of omnipresent market agents knowing the outcome of future events. The reality that market agents cheat, lie and/or tell half-truths in order to get ahead of the competition and make a profit were conveniently excluded. Neither did the theory adequatly take account of the time value of adverse outcomes, i.e. there maybe incentive to market agents to delay the adverse event from taking place, or for other market agents to know about the adverse event at an earlier date.

    The are merits in self-regulation, but as the events over the past year has shown, the assumptions about market agents must be reviewed. Regulation is by design to the benefit of the overall market, but to the detriment of individual market agents who may have benefitted from cheating the market. The "light" regulation of the past decade is not the answer, but neither is "draconian" regulation.

    Further, the balance between too much and too little regulation is constantly moving in this everchanging world. But given the severity of the existing crisis, erring on the side of caution is the better option, at least for the medium term.

    Posted by: Oupoot | Link to comment | April 20, 2009 at 04:23 AM

    save_the_rustbelt says...

    We still have thousands of pages of civil regulations and it did not work.

    Solution? A certainty that Wall Street fraud will be prosecuted.

    Obama just offered immunity from prosecution for 50,000+ tax evaders who used UBS Switzerland accounts, and then Obama waived part of the normal penalties. What is up with that?

    Posted by: save_the_rustbelt | Link to comment | April 20, 2009 at 04:37 AM

    Lafayette says...

    Firstist with the mostest

    OuP: The theory I learned in micro-economics in grad school was that market agents (firms/individuals) will discount any adverse future event in the n'th iteration of an iterative game process to the present, which will guide their decisions in the 1st iteration.

    I was taught that theory as well. Imagine my surprise when I went to work in industry, where I learned that survival was that of the fittest. That managers could not give a damn about n-iterations, because, by the n-th time, they may have lost their jobs for lack of having met objectives (that were entirely extraneous to economic theory).

    I learned that it was not the rules of economics that prevailed but, literally, the rules of war. I was reminded of the Confederate general who, when asked why he won a certain battle, reputedly answered, "Because I got there firstist with the mostest" (and by all means practicable, he forgot to add).

    Economics is not well served by a high-minded theory about how "market agents" make decisions. They make them chaotically, randomly. Why search to give them any rational that is not, in fact, pertinent to the situation? Because it suits our need to be rational?

    Supply and Demand curves determining optimal pricing are an intellectual abstraction of what is happening on the ground. They make very good common sense, but they are not pertinent to evidenced market activity. An industrial giant, with sufficient market share, can increase Supply AND increase Price. How does that well-known fact jibe with your course in EC101?

    Well, your economics professor will tell you that such is not indicative of the economy as a whole. Oh, really?

    We have, for almost a century, opted to organize industry as vertically integrated in a quest to create National and International Industrial Champions by seeking the Holy Grail of economies-of-scale. Now, we've chopped the base of the pyramid off and sent it to China (because that enhances even further our cost economies-of-scale and thereby profits).

    But corporate captains strive to maintain the pyramid's largeness. The larger the pyramids and the less numerous, we think, the better. We need (supposedly) just enough pyramids, in any given industrial sector, to maintain a modicum of competitiveness.

    We should have serious doubts about that conclusion. I doubt competitiveness is all that functional. I doubt that economies-of-scale trickle down to consumers, but I am sure that the average salaries of Top Management are higher. So, what indeed was the point of the integration-exercise, pray tell, except to create a class of well-paid executive managers?

    (NB: If you are looking for an example of the above, consider the automotive industry, which has just begun to implode. And should we apply that analogy to Finance, the result is the Great Subprime Mess of 2008.)

    I am left to conclude that many smaller pyramids all competing for far smaller market shares, meaning more atomization of industry, perhaps provides a higher economic utility (meaning more employment in more durable jobs). I would be pleased to see seven General Electrics in the US, not the conglomerate of one GE as it stands today. (And I used to work for GE when it was nothing like it is today.)

    I also doubt that manufacturing in the US is all that absolute a necessity, except where essential to meet specific customer needs. I see our companies becoming service entities (with engineering, sales and administration) but manufacturing done where cheapest at a guaranteed level of quality.

    Posted by: Lafayette | Link to comment | April 20, 2009 at 05:39 AM

    save_the_rustbelt says...

    "I also doubt that manufacturing in the US is all that absolute a necessity, except where essential to meet specific customer needs. I see our companies becoming service entities (with engineering, sales and administration) but manufacturing done where cheapest at a guaranteed level of quality."

    Ah, this is not working out so well so far. Except for wealthy white guys.

    robertdfeinman says...

    I think there was a hidden force behind the ideology. It is true that in the academic world in the US and UK a "free market" ideology was taught and talked up, but why didn't this happen elsewhere?

    Western Europe and Japan resisted the wholesale abandonment of the social compact and strengthened the services expected of government. As a consequence they had decent growth, good social services, better wealth equality and less militarism and foreign adventurism.

    They also don't have an increasingly multi-generational oligarchy which uses its wealth to promote the "free market" ideology. When one looks under the covers those who fund this type of outlook never subscribe to it themselves. The oligarchs (Koch, Scaife, Walton, Olin, etc) insist on lots of regulations, it is just that they are slanted to favor them.

    For example, tilting the tax laws away from inheritance and capital gains befits the personally wealthy. Similarly cutting the corporate tax rate, creating accelerated depreciation and other financial gimmicks favors large firms over smaller ones. The refusal to enforce anti-trust laws also performs the same function.

    The ideologues like Greenspan and the crew at Chicago are the useful idiots who created a seemingly logical intellectual structure that allowed the plutocrats to continue their plunder of the commons.

    This is a standard tactic of plutocrats throughout history: "do what I say, not what I do". There is no free market, libertarian movement elsewhere because there are no super wealthy keeping the ideology on life support.

    If money could buy power and influence to the extent that existing regulations were trashed or ignored what mechanism is being proposed to prevent this from happening again? Money votes not people.

    Sorry to sound like a "socialist", but the only cure is to have a truly functioning democracy which means that money has to be removed from the electoral process. This means not only during the campaigns, but the institutionalized lobbying, bribery, fund-raising, revolving door cycle that is now the norm for legislators.

    Without an implementation plan talk of lofty goals is just that, talk.

    anne says...

    What was done methodically done as conservatives gained in political influence was to break down regulatory economic safeguards and peddle a philosophy about the need to break down such safeguards that prevailed even through economic crisis on crisis. The process simply quickened with the Presidency of George Bush and a Republican Congress and increasingly Republican court system. The result was not only the legal breaking down of regulations but the ignoring of regulations that lasted and the astonishing economic abuses we are now trying deal with.

    Beyond this, conservatism as beauty must be a joy forever only not nearly so much.

    roger says...

    The fallacy of the narrative fallacy is obviously that it has to find a narrative - something with a beginning and end - to be fallacious about. But of course finding a beginning and an end is a narrative fallacy. It is rather like criticizing the science of unicorns for saying they all have one horn when, really, we don't know whether they have one horn or two. If one is going to set up shop as a radical skeptic, best not to start out lukewarm.

    But getting beyond these issues - the fallacy of de-regulating the shadow financial sector was in the often repeated statement that, given that only the wealthy invest in hedge funds, the government needn't worry about them. The government, see, only exists to protect the "poor". As if the shadow system wasn't so linked and connected to the rest of the system that it could be segregated out. The Guv'mint, and Greenspan in particular, knew, at least since the time of the 98 crisis with LTCM, that their rhetoric about how only the rich would be effected by failures in the shadow financial system was total bs. They bullied and harried the woman at the head of the CFTC (and it is very much to the point that it was a woman, given that one of the bulliers, Larry Summers, seems to have, shall we say, an issue here), Brooksley Born, who actually had two eyes in her head and saw what was going on.

    And of course, Born is right, Summers is wrong, and - in a move applauded by the plutocracy-sodden establishment - Summers is the one calling the shots on the economy in D.C.

    kthomas says...

    Hear hear, Prof. Thoma. Come out swinging: first jab, then vicious right-hook! This is a great way for me to start my week!

    I'm not sure I agree with you on Mr Greenspan's conversion. He's a true believer, and they NEVER change thier minds.

    pebird says...

    The problem is not too aggressive regulation nor a lack of regulation. It is the appearance of regulation where there was little or none. The actual amount of regulation was out of balance with what market participants thought there was.

    This led to trust arbitrage - where if I knew where the system was gamed and you didn't ...

    The purpose of any regulatory regime is to provide the market a floor of trust level - this is what we know and this is what we don't. With no regulation, the regulatory agency becomes Sargent Schultz "I know nothing". But it keeps its mouth shut.

    Self-regulation is an oxymoron. The idea that market participants would freely disclosure information in a spirit of transparency without being forced to is naive at best and more likely disingenuous.

    The idea that they would do so due to the threat of potential government intervention requires that someone in the government monitor the market and compare it against some criteria of disclosure. This is the only way to have a credible threat of intervention. In other words, in order to have self-regulated markets you need regulated markets.

    Houman's response is a laundry list of why we need regulation:

    1. Small is beautiful - how do you maintain smallness without regulation?

    2. Over dependence breeds disaster - lets have non-traditional players enter the financial arena "So long as they are properly regulated".

    3. Derivatives do work - "encourage participants to increase transparency". Again, how can you measure transparency unless you compare the released information to its truth content, which requires a high-degree of intervention - e.g., regulation.

    Why oh why are otherwise intelligent people dancing around the necessity of doing what is painful but obvious?

    Posted by: pebird | Link to comment | April 20, 2009 at 09:38 AM

    Lafayette says...

    s-t-r: Except for wealthy white guys

    Can't imagine what that means? Top Management?

    Sorry, but when I put my forecasting glasses on, Manufacturing does not come up roses. Heavy manufacturing has the highest probability of staying put. (By heavy, I mean cars as well.)

    But light electronics and plastics ... bye, bye -- unless we want to invest in heavy automation. And, if we don't, the Chinese will and they will dominate the market for both low-end (knock-off electronics) and high-end (semiconductor fab plants).

    It's a New Global World out there, beyond the subprime mess. The subprime mess will be history one day, but global competition will only get worse. And we need absolutely a strategy to counter the Chinese.

    One that will reduce three statistics: (1) import volumes, (2) our resulting chronic trade deficit with them and (3) their sovereign fund US T-note holdings.

    Thickheaded says...

    First off, regulatory practices were found to featherbed industries, stifle innovation, and disincent investment. Minsky Conference regular Jamie Galbraith will attest that the turn toward deregulation and monetarism resulted from the deadend Keynsianism ran into in the late 1970's with stagflation. Anything was seen as worth a shot.

    Second off, twinning deregulation with abandonment of any notion of anti-trust meant that eventually M&A would create a new oligopoly without redress. Excess profits would allow co-opting the academic shills and political hacks into favorable featherbedding. Easy money would cover up the gaps.

    The failure of preserving intellectual capital in patents, copyright, and trademarks - the West's only real assets of value after they sold of manufacturing plants - meant that the only solution was rapid innovation and increased financial engineering to facilitate short-term profit maximixing. The so-called moderation was a measure of short-term effect as dislocations in labor were absorbed into lower paying service sector jobs. Easy immigration kept this from boiling over into labor discontent.

    The operating environment became a crap shoot and dependent only on making it cheaper, the finance with high returns and "lower" risk looked like a good move. CFO's suddenly became profit centers rather than the disciplinarians they once had been. Collective ethical failures abounded as temptations increased, and the unaccountable Board rooms lined their pockets with the shareholder's money.

    The idea that high taxes somehow magically restores virtues ignores the very real organizational realities and the way people work... and the consequent result will surely be that off-shoring accelerates. Regulation as the only answer is also simply a ticket for continued enrichment of the legal community at the expense of the rest. Politicians would love the PAC contributions this engenders... but it is detrimental to real reform of the economy. The notion that anything of enduring value can be accomplished without some reform of the way government itself works and accountability to its people seems a chimera. Ditto for making capitalism work for the shareholders rather than allowing their agents to abscond with their funds.

    Present observation suggests that the only discipline democracies respond to tends to come from the outside. One suspects that as Ying follows Yang, that the once suppliant China begins to roar a little more, the West may come to its senses and respond more seriously. Maybe it takes the same outside threat to force accountability also in the Board Room - and if regulation manages this (which it's more timid sort hasn't in 50 years at least), then maybe it is the better of two evils.

    Lafayette says...

    Dammit

    pebird: Small is beautiful - how do you maintain smallness without regulation?

    This is an attractive argument because it goes to the core of what went wrong -- HiFi nerds betting millions of someone else's money, breaking the bank, then crowing that they were TBTF.

    Still, the incentive to maximize income will be there (at today's present rates of marginal income taxation). Whether there are a big six / seven banks or fifty small banks, the market volumes are for the taking. And the markets will go to those who arbitrage best. These winners will initially not pocket profits, roll onwards their profits by gaming them. When once again large enough, then the will try to sell out to a larger bank, cash in, and buy a megabuck ranch-style house in Palm Beach.

    So, they'll be back in business soon, but on a smaller scale. Which does not automatically make them less dangerous. They are still playing the same arbitrage game with their probability models.

    These people are so dull as to be perfectly predictable. But they are also perfectly focused on an objective -- the nirvana of megabuck earnings for each one of them.

    Dammit if the plan doesn't work ...

    anne says...

    "By the early 80s, most of the baby boomers were already in the workforce, and if anything, women were leaving the workforce to be stay at home mothers, since they were in their peak childbearing years."

    Women if anything were continually entering the workforce through the 1980s and 1990s, the employment-population ratio for women continually increasing from the 1960s and only leveling off during the Bush years as job creation faltered.

    Even these last years however women have gained and held employment relatively better than men, which has been especially important in terms of family support through this recession. *

    * http://www.bls.gov/webapps/legacy/cpsatab1.htm

    anne says...

    "By the early 80s, most of the baby boomers were already in the workforce, and if anything, women were leaving the workforce to be stay at home mothers, since they were in their peak childbearing years."

    Women if anything were continually entering the workforce through the 1980s and 1990s, the employment-population ratio for women continually increasing from the 1960s and only leveling off during the Bush years as job creation faltered. Even these last years however women have gained and held employment relatively better than men, which has been especially important in terms of family support through this recession. *

    * http://www.bls.gov/webapps/legacy/cpsatab1.htm

    Posted by: anne | Link to comment | April 20, 2009 at 12:24 PM

    rps says...

    "....after decades and decades of instability in the 1800s and early 1900s, followed by the massive bank failures of the early 1930s, regulations were imposed to stabilize the banking system. The result was sixty years of calm in the financial sector. That's hardly a failure of regulation."

    Sixty years of calm?, Tsk, tsk, tsk here's an F- on your paper. What does one call 1,043 savigs and loans failures? Or how about the insolvency of the FSLIC? How about the Depository Institutions Deregulation and Monetary Control Act (DIDMCA) of 1980 and the Garn-St. Germain Depository Institutions Act of 1982?

    How soon one forgets the Savings and Loan Scandal of the 1980's into the 90's. In fact, I would state that the S&L scandal was the primer for today's lack of regulation, incestuous relationships between Congress and the financial industry.

    Wiki: "Policies combined with an overall decline in regulatory oversight (known as forbearance), would later be cited as factors in the later collapse of the thrift industry. From 1986 to 1989, FSLIC closed or otherwise resolved 296 institutions with total assets of $125 billion. An even more traumatic period followed, with the creation of the Resolution Trust Corporation in 1989 and that agency's resolution by mid-1995 of an additional 747 thrifts. [8]

    A Federal Reserve Bank panel stated the resulting taxpayer bailout ended up being even larger than it would have been because moral hazard and adverse selection incentives that compounded the system's losses. [9]

    There also were state-chartered S&Ls that failed. Some state insurance funds failed, requiring state taxpayer bailouts."
    Sound Familiar?

    Due to Congresses contempuous refusal to throw their own under the bus, and instead invoked the Ethics Committee slap on McCain's wrist has led us again down the yellow belly brickroad to today's intentional fraud and once again our millionare Congressmen indulge their BFF's club of greedy, fraudulent, tax evading investment and insurances houses with bailouts onto the backs of the taxpayers.
    IF Congress had down their job and thrown McCain and the other 4 senators under the bus, would we be here today? Public humiliation and Orange jumpsuits are a great deterrent for our elected officials.

    William Black, Federal Banking Regulator 1984-1994 at keatingeconomics.com speaks candidly about the S&L scandal.

    Mattyoung says...

    Sometimes it appears we live in an imaginary world.

    There is one super monopoly in our economy, Congress, who ultimately control 23% of the economy. This group cannot operate without a big shadow banking system with the job of arbitrating the short term fluctuations that the long term policies of Congress generate.

    What happens when Congress screws up, when they get the cash flow for some programs out of whack and cannot fix things in time? The big banks step in with short term hedges and bond purchases to smooth out things out.

    Anne would like us to remove Congress from the laws of economics, pretend they can be some sort of referee, but they are big players, the biggest, and the volatility they cause will be with us sooner or later.

    roger says...

    Women, of course, did not leave the economy (that is, as economists define the economy, where work is what you are paid for) to go home (where work isn't paid for, and thus isn't work) in the 80s. I don't know where that idea came from. Here's a nice little Bureau of Labor chart to illustrate that fact:
    http://www.bls.gov/opub/mlr/2003/10/ressum3.pdf

    Without women entering (sic) the work force (instead of lazing around all day, raising children, cleaning, cooking, managing household finances, dealing with medical crises, and in general not working) the median American household would have been forced down several percentiles. And it would have occured to the constituency that has supported Reagonomics, white males, that really, they were being cheated.

    Not Mark T says...

    RE: the Sgt. Schultz as regulator model, an issue that we may be hearing more about is the prevalence of "side letters" used in credit default swaps. In essence these were hidden agreements indicating that issuers such as AIG never intended to pay, and counterparties never intended to collect, on CDS contracts only intended to spruce up a public traded company's balance sheet (see: http://us1.institutionalriskanalytics.com/pub/IRAstory.asp?tag=351). According to a lawyer friend in the insurance industry, state insurance regulators have long been aware of this practice but looked the other way ... until now. All this to say that unless the only objective is to give the patina of legitimacy, rules on paper have to be enforced.

    kthomas says...

    @ roger "...And it would have occured to the constituency that has supported Reagonomics, white males, that really, they were being cheated." VERY funny. Who's the greater fool, the fool or his poor overworked wife?


    Can someone cite just 1 example of a market that has functioned soundly with only self-regulation? C'mon, ye true believers....tell us.

    btg says...

    anne: Women if anything were continually entering the workforce through the 1980s and 1990s, the employment-population ratio for women continually increasing from the 1960s and only leveling off during the Bush years as job creation faltered. Even these last years however women have gained and held employment relatively better than men, which has been especially important in terms of family support through this recession. *

    * http://www.bls.gov/webapps/legacy/cpsatab1.htm

    Well, Anne, I was referencing this:

    http://findarticles.com/p/articles/mi_m1153/is_n9_v120/ai_20064085/?tag=untagged

    During the early 1990's, there was no growth in women's labor force participation rates; since 1994 however, the rate has edged upward, with mothers accounting for most of the rise

    From March 1975 to March 1996, the labor force participation rate of women rose from 46 percent to nearly 59 percent (table 1). Although it rose without interruption through 1990, the increase did not proceed at a steady pace; rather the rate of increase slowed gradually over time. Between 1975 and 1980, women's labor force participation rate increased an average of 1 percentage point per year, from 1980 to 1985, the average annual gain fell to 0.7 percentage point. During the next 5 years--1985 to 1990--the gain was slower still, averaging 0.5 percentage point per year.

    anne says...

    The unemployment rate for women maintaining families, declined from 10% in 1992 to 5.9% in 2000 and is currently 10.8%. During the Reagan years, the unemployment rate did not fall below 10% till 1985 and below 9% till 1988. The rate was lowered however to 5.9% under Clinton, only to rise from there.

    Posted by: anne | Link to comment | April 20, 2009 at 05:47 PM

    the buggy professor says...

    1) Lafayette and Rustbelt (among others) have lamented the decline of US manufacturing industry. Has manufacturing industry actually declined?

    Yes and no. It depends on the measure used.


    2) If jobs are the measure, then yes --- the percentage of the US workforce in manufacturing declined from about 35% in the early 1970s to around 12% in 2004. But note: the same trend has been at work in all the other large advanced industrial countries: the UK, France, Germany, and Japan. Click here for a publication put out by the Council of Economic Advisers (2004) that captures the trends in the US along with these other four countries, then go to diagram 7. Note that the US had a smaller sector compared to these other countries even in the late 1960s. Note also that the fall has been sharper for the UK and France, with Germany and Japan not falling so fast until the early 1990s.


    3) If the percentage of manufacturing in US GDP is the measure, then again a roughly similar picture emerges. It has declined to around 12-13.


    4) If the measure, though, is the dollar value of manufacturing output, it was at an all-time peak in 2006-07 at over $1.6 trillion . . . almost double the output a decade ago. According to Business Week yesterday,

    "As Stephen Manning of the Associated Press acknowledged in a rare "just the facts" story in mid-February, the U.S. "by far remains the world's leading manufacturer," producing goods valued at a record $1.6 trillion in 2007 - nearly double the $811 billion produced a decade earlier. Indeed, the AP writer noted, "For every $1 of value produced in China's factories [in 2007], America generated $2.50." Not bad for a country that doesn't produce anything anymore."


    Please note carefully: American manufacturing --- including multinational implants here from abroad --- produce 250% more in dollar-calculated output than China does (with a much greater role for foreign implants). A surprise to many of us, no?

    Then, too, contrary to largely uninformed opinion, US manufacturing output is larger than that of China's, Japan's, or Germany's as a percentage of total world mfg. output. 21% in 2006.


    5) If the measure is investment levels, note the astonishing pace in 2007 for US manufacturing (same Business Week source)
    "Not only is the U.S. still the world's leading manufacturer, but there are many good reasons that companies will continue to manufacture here and invest in new plants and equipment. According to the Census Bureau's 2007 Annual Capital Expenditures Survey, released on Jan. 22 of this year, U.S. nonfarm businesses invested $1.36 trillion in new and used structures and equipment in 2007, a 3.9 percent increase over 2006. More than $484 billion was spent on new structures alone."


    6) Enter manufacturing exports.

    And US export-manufactures were at an all-time peak in total value in 2007 as well. Note that they are heavily concentrated in capital goods, which in turn depend markedly on R&D, innovation (process or radical product), good marketing, and highly skilled labor . . . not to mention constant investment.. There is no reason to assume that such capital goods production will be easily transferred abroad, the way more standardized consumer-products have been.


    7) If the measure is the wage (plus benefits) of workers in manufacturing industry, it was almost double in inflation-adjusted terms last year compared to the early 1970s, when the industrial work force was three times larger as a percentage of total employment: about $66,000 vs. $37,000.

    ………………………………….


    8) All of which leads to a question of importance: what has caused the decline in manufacturing jobs and output as a percentage of total US employment and GDP?

    As usual, the causes are multiple:

    * Extraordinary leaps forward in manufacturing productivity in the 1980s and 1990s into this decade. Click here again (the Council of Economic Advisers' study), then go to diagram 5. As the commentary notes, between 1950 and 2000, average nonfarm productivity grew at 2.0% a year; the equivalent stat for manufacturing was 2.8% --- almost double. Note though how both measures soared from 1995 on to 2003 (the last year analyzed in the study), with manufacturing productivity's growth rate rising over 70% and the service sectors' by even more from its point at the end of 1994.

    *The globalizing influences working everywhere in the world, not least in the industrial leading countries of the 1950s – 1970s, with the growing shift of fairly low-or middle-level skills or at least standardized production to developing countries like Mexico, Brazil, and Pacific Asia. The major driving force here has been multinational manufacturers, taking advantage of disciplined workers who have the skills to work effectively with modern technologies.

    Note that there have been no significant work by economists --- or even business school professors (since some pathbreaking work out by Raymond Vernon and others at the Harvard Business School in the 1960s and 1970s) --- on the overall causes and repercussions of such "multi-level" production chains globally. Even Krugman's original work on geography and trade doesn't deal with it in depth.

    *The trade effects that ensued from the rapid growth of standardized manufacturing in Pacific Asia and parts of Latin America. Compounded, obviously, by the use of neo-mercantile efforts by China --- and earlier, until the late 1980s by Japan and others in East Asia --- to keep their currencies from appreciating against the $US and later the Euro. To note this is not to deny that there has been a lot of controversy on this topic, including the growing dependence of the US economy on capital inflows from abroad . . . along with a cost/benefit analysis of the outcomes.

    *And finally, connected with these, the growing importance in the US economy of high-tech service industries, not least financial. Along with the shift of standardized manufacturing to developing countries --- including the use of China's disciplined, moderately skilled work force for assembly production and exports --- the US pioneer role in creating a knowledge-based economy has, for good or bad, shifted our comparative advantage toward both high-tech services and capital-goods manufactures.

    ----- A little tantalizing evidence follows here. According to a good study put out last year by Robert Gordon of Northwestern and a British colleague on the slowdown in the EU's productivity growth after 1995 compared to the US's --- but, oppositely, a better performance by the EU in creating jobs ---,

    "We find that the revival of European employment growth can help explain why European productivity slowed. But we do not explain why European productivity growth did not accelerate as occurred in the US. US productivity took off after 1995, growing at 0.7 percent faster per year, but in Europe a literal reading of the productivity growth data leads to doubt that the internet revolution ever occurred in Europe.

    "Some of Europe's poor recent performance can be explained by reforms that will enhance growth in the long run, but not all of it. Our findings should lead EU policymakers to think about the two-edged effects of policy reforms on employment and productivity, but they should also worry about how to encourage innovation and the adoption of new technologies.1"
    Source: Click here.

    ………

    Michael Gordon, AKA the buggy professor

    anne says...

    http://www.bls.gov/webapps/legacy/cpsatab1.htm

    January 9, 2009

    Employment-Population Ratio, Women, 1948-2009

    1948 31.3 *
    1949 31.2 (Low)

    1950 32.0
    1951 33.1
    1952 33.4 Eisenhower
    1954 32.5

    1955 34.0
    1956 35.1
    1957 35.1
    1958 34.5
    1959 35.0

    1960 35.5
    1961 35.4 Kennedy
    1962 35.6
    1963 35.8 Johnson
    1964 36.3

    1965 37.1
    1966 38.3
    1967 39.0
    1968 39.6
    1969 40.7 Nixon

    1970 40.8
    1971 40.4
    1972 41.0
    1973 42.0
    1974 42.6 Ford

    1975 42.0
    1976 43.2
    1977 44.5 Carter
    1978 46.4
    1979 47.5

    1980 47.7
    1981 48.0 Reagan
    1982 47.7
    1983 48.0
    1984 49.5

    1985 50.4
    1986 51.4
    1987 52.5
    1988 53.4
    1989 54.3 Bush

    1990 54.3
    1991 53.7
    1992 53.8
    1993 54.1 Clinton
    1994 55.3

    1995 55.6
    1996 56.0
    1997 56.8
    1998 57.1
    1999 57.4

    2000 57.5 (High)
    2001 57.0 Bush
    2002 56.3
    2003 56.1
    2004 56.0

    2005 56.2
    2006 56.6
    2007 56.6
    2008 56.2

    March

    2009 55.1

    * Employment age 16 and over

    Posted by: anne | Link to comment | April 20, 2009 at 05:13 PM

    anne says...

    Periods in which the increase of the employment-population ratio for women whether over 16 or 20 years of age slowed, were periods of recession and slow job creation following recession as notably in the early 1990s. Job creation during the Bush Presidency from 1989 to 1993 was 53,000 monthly, while during the Clinton Presidency job creation was 240,300 monthly. Women worked when there were jobs, and women worked even more when employers accomodated women. *

    * http://www.bls.gov/webapps/legacy/cesbtab1.htm

    Posted by: anne | Link to comment | April 20, 2009 at 05:21 PM

    anne says...

    http://findarticles.com/p/articles/mi_m1153/is_n9_v120/ai_20064085/?tag=untagged

    "During the early 1990's, there was no growth in women's labor force participation rates; since 1994 however, the rate has edged upward, with mothers accounting for most of the rise."

    Duh. During the early 1990s, Bush years, there was minimal job creation. Job creation through the Clinton years that was almost 5 times higher, and more emphasis on work opportunities for women, led to women continually entering the workforce and continually narrowing the employment-population ratio gap with men. The gap is still narrowing, but the Bush years from 2001 were marked by an astonishing 27,000 jobs created monthly.

    Posted by: anne | Link to comment | April 20, 2009 at 05:30 PM

    anne says...

    We went then from 53,000 jobs created monthly during the years of Bush, to 240,300 jobs created monthly under Clinton to 27,000 jobs created monthly during the recent Bush Presidency. Women entered the workforce according to opportunity. We are now at the lowest employment-population ratios for men whether over age 16, or 20, or 25, since 1948 when data was initially recorded.

    When looking to employment-population ratios, we need to look to women and men separately, and understand how relatively severe a time this is for men.

    Posted by: anne | Link to comment | April 20, 2009 at 05:39 PM

    anne says...

    The unemployment rate for women maintaining families, declined from 10% in 1992 to 5.9% in 2000 and is currently 10.8%. During the Reagan years, the unemployment rate did not fall below 10% till 1985 and below 9% till 1988. The rate was lowered however to 5.9% under Clinton, only to rise from there.

    Posted by: anne | Link to comment | April 20, 2009 at 05:47 PM

    the buggy professor says...

    1) Lafayette and Rustbelt (among others) have lamented the decline of US manufacturing industry. Has manufacturing industry actually declined?

    Yes and no. It depends on the measure used.


    2) If jobs are the measure, then yes --- the percentage of the US workforce in manufacturing declined from about 35% in the early 1970s to around 12% in 2004. But note: the same trend has been at work in all the other large advanced industrial countries: the UK, France, Germany, and Japan. Click here for a publication put out by the Council of Economic Advisers (2004) that captures the trends in the US along with these other four countries, then go to diagram 7. Note that the US had a smaller sector compared to these other countries even in the late 1960s. Note also that the fall has been sharper for the UK and France, with Germany and Japan not falling so fast until the early 1990s.


    3) If the percentage of manufacturing in US GDP is the measure, then again a roughly similar picture emerges. It has declined to around 12-13.


    4) If the measure, though, is the dollar value of manufacturing output, it was at an all-time peak in 2006-07 at over $1.6 trillion . . . almost double the output a decade ago. According to Business Week yesterday,

    "As Stephen Manning of the Associated Press acknowledged in a rare "just the facts" story in mid-February, the U.S. "by far remains the world's leading manufacturer," producing goods valued at a record $1.6 trillion in 2007 - nearly double the $811 billion produced a decade earlier. Indeed, the AP writer noted, "For every $1 of value produced in China's factories [in 2007], America generated $2.50." Not bad for a country that doesn't produce anything anymore."


    Please note carefully: American manufacturing --- including multinational implants here from abroad --- produce 250% more in dollar-calculated output than China does (with a much greater role for foreign implants). A surprise to many of us, no?

    Then, too, contrary to largely uninformed opinion, US manufacturing output is larger than that of China's, Japan's, or Germany's as a percentage of total world mfg. output. 21% in 2006.


    5) If the measure is investment levels, note the astonishing pace in 2007 for US manufacturing (same Business Week source)
    "Not only is the U.S. still the world's leading manufacturer, but there are many good reasons that companies will continue to manufacture here and invest in new plants and equipment. According to the Census Bureau's 2007 Annual Capital Expenditures Survey, released on Jan. 22 of this year, U.S. nonfarm businesses invested $1.36 trillion in new and used structures and equipment in 2007, a 3.9 percent increase over 2006. More than $484 billion was spent on new structures alone."


    6) Enter manufacturing exports.

    And US export-manufactures were at an all-time peak in total value in 2007 as well. Note that they are heavily concentrated in capital goods, which in turn depend markedly on R&D, innovation (process or radical product), good marketing, and highly skilled labor . . . not to mention constant investment.. There is no reason to assume that such capital goods production will be easily transferred abroad, the way more standardized consumer-products have been.


    7) If the measure is the wage (plus benefits) of workers in manufacturing industry, it was almost double in inflation-adjusted terms last year compared to the early 1970s, when the industrial work force was three times larger as a percentage of total employment: about $66,000 vs. $37,000.

    ………………………………….


    8) All of which leads to a question of importance: what has caused the decline in manufacturing jobs and output as a percentage of total US employment and GDP?

    As usual, the causes are multiple:

    * Extraordinary leaps forward in manufacturing productivity in the 1980s and 1990s into this decade. Click here again (the Council of Economic Advisers' study), then go to diagram 5. As the commentary notes, between 1950 and 2000, average nonfarm productivity grew at 2.0% a year; the equivalent stat for manufacturing was 2.8% --- almost double. Note though how both measures soared from 1995 on to 2003 (the last year analyzed in the study), with manufacturing productivity's growth rate rising over 70% and the service sectors' by even more from its point at the end of 1994.

    *The globalizing influences working everywhere in the world, not least in the industrial leading countries of the 1950s – 1970s, with the growing shift of fairly low-or middle-level skills or at least standardized production to developing countries like Mexico, Brazil, and Pacific Asia. The major driving force here has been multinational manufacturers, taking advantage of disciplined workers who have the skills to work effectively with modern technologies.

    Note that there have been no significant work by economists --- or even business school professors (since some pathbreaking work out by Raymond Vernon and others at the Harvard Business School in the 1960s and 1970s) --- on the overall causes and repercussions of such "multi-level" production chains globally. Even Krugman's original work on geography and trade doesn't deal with it in depth.

    *The trade effects that ensued from the rapid growth of standardized manufacturing in Pacific Asia and parts of Latin America. Compounded, obviously, by the use of neo-mercantile efforts by China --- and earlier, until the late 1980s by Japan and others in East Asia --- to keep their currencies from appreciating against the $US and later the Euro. To note this is not to deny that there has been a lot of controversy on this topic, including the growing dependence of the US economy on capital inflows from abroad . . . along with a cost/benefit analysis of the outcomes.

    *And finally, connected with these, the growing importance in the US economy of high-tech service industries, not least financial. Along with the shift of standardized manufacturing to developing countries --- including the use of China's disciplined, moderately skilled work force for assembly production and exports --- the US pioneer role in creating a knowledge-based economy has, for good or bad, shifted our comparative advantage toward both high-tech services and capital-goods manufactures.

    ----- A little tantalizing evidence follows here. According to a good study put out last year by Robert Gordon of Northwestern and a British colleague on the slowdown in the EU's productivity growth after 1995 compared to the US's --- but, oppositely, a better performance by the EU in creating jobs ---,

    "We find that the revival of European employment growth can help explain why European productivity slowed. But we do not explain why European productivity growth did not accelerate as occurred in the US. US productivity took off after 1995, growing at 0.7 percent faster per year, but in Europe a literal reading of the productivity growth data leads to doubt that the internet revolution ever occurred in Europe.

    "Some of Europe's poor recent performance can be explained by reforms that will enhance growth in the long run, but not all of it. Our findings should lead EU policymakers to think about the two-edged effects of policy reforms on employment and productivity, but they should also worry about how to encourage innovation and the adoption of new technologies.1"
    Source: Click here.

    ………

    Michael Gordon, AKA the buggy professor

    Posted by: the buggy professor | Link to comment | April 20, 2009 at 05:57 PM

    Patricia Shannon says...

    According to libertarians, we don't need regulation of things like food safety. Industries will self-regulate. And they will still preach this even during well-publicized recalls of food contaminated by Salmonella, that was sold knowing it was contaminated. Totally idiotic.

    Posted by: Patricia Shannon | Link to comment | April 20, 2009 at 06:41 PM

    ken melvin says...

    Buggy:

    Even if your $66k/37k is correct, I don't believe that it is, this leaves only ~ $23kper, down a bit from your $37, to the work force.

    There's a real question about what should constitutes GDP. If production of goods is only some 12-13%, what the hell is that we're producing? And, who's getting paid for it?

    Tell us more about this $1.6 trillion worth of manufactured; like the worth part and who bought. Double a decade earlier, you say. What was it that we were manufacturing in 1997 that was so different from what we were manufacturing in 2007?

    Driving down Wycliff or East 14th, all one sees is deserted, bombed out hulls of factories, even those we automated in the 80s are gone, so where is this manufacturing taking place. Genentech makes cancer drugs that cost $6k a month; this what you have in mind? The Immunex for arthritis which cost $1.3k a month? Those who held stock options who work there or had stock options did well. Hard to afford these on $23k per. And, it makes insurance and Medicare very expensive.

    You real sure about all this investment in plant and equipment in 2007? News to me. And, a few examples please of the capital goods that can't be manufactured overseas?

    Posted by: ken melvin | Link to comment | April 20, 2009 at 09:39 PM

    Lafayette says...

    Internet shminternet

    bp: Has manufacturing industry actually declined? Yes and no. It depends on the measure used.

    Yes, I used GDP accounts that show, in the US, that Services account for nearly 70% of economic activity.

    Do you know a better method? Pray, show us the way ...

    So you think that exports are our salvation? No way, José. Exports are typically less than 10% of GDP.

    US productivity took off after 1995, growing at 0.7 percent faster per year, but in Europe a literal reading of the productivity growth data leads to doubt that the internet revolution ever occurred in Europe.

    Internet shminternet. It happened here and typically in a better way than stateside. I know no one in France still on dial-up, whereas in the US their numbers are so large that Obama is focusing stimulation money on the problem. (I have friends in central Massachusetts, thirty minutes from Boston's "Silicon Valley" along (old) Route 128 still on dial-up.)

    Besides, productivity is, I maintain, intrinsically a matter of hours worked, not Internet penetration. The French were particularly idiotic in forcing the 35-hour week on French industry, and is now paying the consequences of that Socialist stupidity. Everywhere, EU leadership is trying desperately to convince national populations that the "good times" are over and they must get back to work.

    But, that is difficult in countries that have become inured to working too hard. See here. Look at the tail-end of countries to the left of that graphic -- all EU ...

    It's Europe's version of: "We have met the enemy and he is us."(Pogo by Walt Kelly)

    Posted by: Lafayette | Link to comment | April 20, 2009 at 11:44 PM

    Lafayette says...

    When pigs sprout wings

    hari: From what I am reading, it seems IMF will not *advise* any more but *manage* global economy from now on....

    Oh, come on, "manage" the Global Economy? With what tools? This will happen when pigs sprout wings.

    The above sounds like a pompous announcement from Strauss-Kahn, its pompous French Director, who as Minister of Finance in France did f***-all to redress the French economy. And, now he is moving on to manage the global economy? Everybody take cover ... --

    Strauss-Kahn is preparing himself for a return to France (according to the buzz at the IMF) as a presidential candidate in 2011. It's written on everything he does.

    Frankly, I hope he does run. He ran two years ago ... and came in third as Socialist candidate behind Segolen Royal whom Sarkozy defeated.

    But, I cannot abide the notion that Strauss-Kahn, or the IMF, should be managing the Global Economy. The IMF's track record in the matter has been abysmal and the global economy does not need a statist at its helm.

    Posted by: Lafayette | Link to comment | April 21, 2009 at 01:27 AM

    Lafayette says...

    Post Scriptum

    The make-up of a political class often affects remarkably the destiny of a country. Of course, if one likes, it is perhaps an "exogenous variable". I doubt that any democracy elects its leaders solely based upon professional background. There are too many other important variables that enter into an election, not the least of which is how we part our hair. (;^)

    France is perhaps an exception to that rule, however. As I've opined here before, France must confront the fact its political class is dominated by people who graduated from one university, the Ecole Nationale d'Administration (ENA). They are known as ENArques and have established a crony corporation within French politics. If interested, read here.

    John Kenneth Galbraith was fascinated enough to study the school and how it trained France's top Civil Servants. It is indeed impressive. The selection is stringent and, in fact, these people all come from the same social class (and a finite number of French secondary schools). They are by no means, therefore, representative of the French society as a whole.

    Unfortunately, under socialist rule, far too many went from the Civil Service to state owned companies, such as Airbus -- where a number of them have had disastrous careers as industrial managers.

    It is a popular (mis)conception in France that to become President, one must be either an ENArque or a Freemason and preferably both. An example of how it works: Jacques Chirac, an ENArque promoted another ENArque as his last Prime Minister -- though the man never had been elected to any political office in his life. It was a desperate attempt to block the ascent of Sarkozy, in view of upcoming presidential elections, since both Chirac and Sarkozy have little common friendship though they are both on the Right. (Such is typical of politics around the world, but particularly an attribute of French politics. Methinks.)

    Sarkozy (current President of France) was a lawyer by training but Strauss-Kahn is indeed an ENArque. The ENArques can screw-up a free lunch and still find time to blame someone else. By then, however, they are well-ensconced in another job somewhere in the administrative hierarchy.

    To wit, I would not want this gentleman "managing the Global Economy" as a promotional run-up to his candidacy as French president. Despite the fact that he is, otherwise, an intelligent person, I doubt that any present-day Socialist could find the exit from within a wet paper-bag, as regards the economy. They have not yet understood a fundamental principle of Political Economy: For the wealth of a nation (or nations) to be shared equitably, it must first be generated. Therein lies the challenge as "Tax and spend" is the easy part.

    That simple rule somehow amazingly escapes the Leftist-species of politician and not only in France.

    My point: The make-up of a political class often defines the destiny of a country. Their educational backgrounds are indeed important, I find. With this in mind, have a look here
    to understand our own political class in the US.

    It should surprise no one that the largest contingent is lawyers. Perhaps they are instinctively drawn to politics? Still, it is impressive to see that about 8% are economists!

    Wherever are they ... ?

    Posted by: Lafayette | Link to comment | April 21, 2009 at 01:43 AM

    hari says...

    Marquis -

    You are indeed ranting like hell....

    The substance of what I posted did not get into to clever head - for some good reason methinks - because DSK is not your *type* of leader required by IMF

    However I'd like to admonish(!) you and the likes of you to consider that G20 Summit decided to inject +$1T
    into IMF coffers for a good reason. China and Brazil are funding it - besides G7.

    IMF is going to *manage* global financial regulatory platform along with (BIS) Stability Board created by G20. This will be decided during the weekend session of G7 and then G20.

    France is a great civilization - notwithstanding your rant about DSK and the rest of the political class.

    Posted by: hari | Link to comment | April 21, 2009 at 03:04 AM

    save_the_rustbelt says...

    buggy:

    I am aware of all of that.

    The lost manufacturing jobs were supposed to be replaced with "high value service jobs." Oops.

    Apparently those service jobs consisted largely of originating subprime mortgages and working at Wal-mart.

    And much of the construction industry has been turned over to undocumented workers (avoids all that messy stuff like taxes, OSHA, workers comp, etc.).

    Blue collar America bleeds so professors and investment bankers can be comfortable.

    Posted by: save_the_rustbelt | Link to comment | April 21, 2009 at 05:35 AM

    LeeAnne says...

    All this gentlemanly talk is pay for bloviating.

    "... Because policy had improved, and because we believed the economy was more stable due to deregulation, we let our guard down."

    How about that a tsunami of cash to lobby congresspersons to the tune of the $5,000,000,000, the largest percentage of it from the finance sector, combined with collusion in high places PAID to let your guard down.

    Sounds more like payoffs to me albeit legal payoffs.

    Posted by: LeeAnne | Link to comment | April 21, 2009 at 06:45 AM

    Patricia Shannon says...

    Lafayette,
    This is 2009. Why should we need to work more hours than hunter-gatherers? Where is that productivity people keep talking about going? You may be content to be a piece of machinery to enable the top 1/2 of 1% to live in extreme luxury and decadence, but not all of us are. Some of us actually have our own lives and interests.

    Posted by: Patricia Shannon | Link to comment | April 21, 2009 at 08:56 AM

    K Ackermann says...

    This whole blog war thread is entirely unsatisfying. You guys talk in sweeping generalities that you know will never happen, but on instnaces where you get specific, you are just nibbling at the edges. I get the feeling you want everything to continue the same, but without the problems.

    Is it possible the system as a whole is the problem?

    The financial system is set up to serve itself, and hence, siphons away wealth from its clients.

    You disagree? Then why does the industry spend gobs of money to prevent legislation to disclose the details of fees associated with 401k's? That is just one small example.

    The banks wanted deregulation because they said they could manage risk better than anyone. It turns out they are self-serving liars suffering from habitual greed.

    Google "Citi Fined", and tell me that Citi is not a major criminal organization. The most crime-infested place on the planet is Wall Street. That's just a fact.

    Harry Markopolos spent 7 years pounding on the fortress gates of the SEC to let him in so he could warn about fraud, but they kept telling him to go away.

    With that kind of attitude, I am now of the opinion that those on Wall Street who commit crime should pay the ultimate price. Nothing else works, and they are literally doing more damage to this country than all the terrorist acts you could dream up would do.

    The system will change. How many bullets will be needed is up to the industry.

    Posted by: K Ackermann | Link to comment | April 21, 2009 at 09:16 AM

    YerMawm says...

    More regs...you mean like SOx? That sure did the trick. Laws ONLY keep the honest people honest. Financials among the most regulated industries. Most of this current mess would be solved by growing balls, and prosecute under existing fraud laws.

    In fact, as long as there is a Federal Reserve Board, a private banking cartel engaged in the price fixing of money, and theft via inflation targets, there is regulation.

    Suggest more concrete examples from history rather than generalizing the 1800's and 1900's as the financial wild west. Some periods during the 1800's were indeed our most prosperous, stable, and productive. We haven't even begun to see instability yet. During TGD many people still lived on farms, and grew their own food. A lesson we need to relearn...NOW.

    Posted by: YerMawm | Link to comment | April 21, 2009 at 09:25 AM

    Lafayette says...
    hari: However I'd like to admonish(!) you and the likes of you to consider that G20 Summit decided to inject +$1T ...

    Admonish away! ;^) Sticks and stones ... etc., etc., etc.

    1 trillion dollars is to managing world trade as my pissing in the ocean is to desalinating it. The key word is manage, meaning being responsible for exchange rate variations and international transactions (of all sorts).

    That can only be done with a UN-type Federated Reserve System and signatories to a Treaty that allows that agency to employ its own reserve currency. It just ain't gonna happen. That sort of treaty will never, ever get passed in the US Senate.

    We've been down this road before and I insist on the following: There is meaningful regulation on the national level because banks are regulated by national legislation. There is NO international law (meaning a binding treaty) in the matter of regulating international finance and there never will be. As such, there is no way to "regulate" it.

    All that the IMF can do is blow a whistle. Given the scare the Great SubPrime Mess of 2008 has created, that alone may be sufficient to focus attention and get action. Which is goodness.

    And about Basel; I think (quite personally) that it is a fine idea. It is an established agreement, but without the force of a treaty. (As I recall, we exchanged on that idea some months ago.) BaselII needs to be tightened down because it proposes using bank-developed business models to regulate financial banking. That just ain't gonna work either.

    If Basel2 is to be taken seriously, it must be truly independent in all ways and means from the market agents it is supervising. But, coming up with new models is not Mission Impossible.

    Methinks.

    Posted by: Lafayette | Link to comment | April 21, 2009 at 10:28 AM

    hari says...

    What you don't seem to understand is while G20 was Brown's forum to reform Bretton Woods institutions, IMF actually came out stronger because the Chinese felt they were prepared to sleep with the devil they knew...(you know the rest).

    That's how G20 decided to inject seed capital to reform IMF itself. [DSK will be a transition man until these changes, in fact, take place].

    The other aspect is international trade finance facility - a separate matter altogether.

    The q' is if you are going to reform the (existing) structure of IMF, what will become of the hitherto role of US Treasury (the paymaster since WWII) in framework of IMF policy decision-making.

    IMO the OECD block, and G7, have made the compelling decision to liberate IMF from their voting majority and to forego IMF Chair by EU to emerging markets.

    Who will lead the new IMF set up? Most likley Indians seem to have inside track to management seat because of their professional and other qualifications.

    China will more likely takeover WB and its operations.

    In sum, we're at a turning point in managing global financial system in a period of globalization.

    Posted by: hari | Link to comment | April 21, 2009 at 11:58 AM

    Lafayette says...

    A matter of values

    PS: You may be content to be a piece of machinery to enable the top 1/2 of 1% to live in extreme luxury and decadence, but not all of us are. Some of us actually have our own lives and interests.

    I don't decry the French for their way of life. I do for their way of work. And it is the latter that makes for the former.

    If I thought the standard of living was better in the US, I'd be a fool to remain in France. So, call me a fool, but I do believe the standard of living in a great many ways is better in France.

    That said, I have worked both in the US and in France. We work harder in the US. Tis a pity perhaps that we don't enjoy life better.

    But, then, who am I to judge? Maybe Americans enjoy life by working hard. No joke. It could be very true. Cultural diversity is a matter of values. If Americans value work over leisure, they are simply exercising their freedom of choice.

    Posted by: Lafayette | Link to comment | April 21, 2009 at 12:06 PM

    Phillip Huggan says...

    http://en.wikipedia.org/wiki/Human_Development_Index

    "So, call me a fool, but I do believe the standard of living in a great many ways is better in France."

    The world is waiting for you to improve this methodology. Nepal would literally take your words as policy if accurate. Psychologically and physiologically any policy that gets people in wealthy developed countries their first $10000 in income is a winner and there are no doubt more of these policies in France than in America. I know first-hand America is hostile to foreigners as of 2004. I'm sure I could visit France no problem.

    Posted by: Phillip Huggan | Link to comment | April 21, 2009 at 12:38 PM

    the buggy professor says...

    1) US Exports, by percentage for 2003 --- the latest data, strangely, at the CIA WorldFactBook (imports the same year too)

    https://www.cia.gov/library/publications/the-world-factbook/geos/us.html#Econ

    "agricultural products (soybeans, fruit, corn) 9.2%, industrial supplies (organic chemicals) 26.8%, capital goods (transistors, aircraft, motor vehicle parts, computers, telecommunications equipment) 49.0%, consumer goods (automobiles, medicines) 15.0% (2003)"

    ......


    2) All these industries --- including US agriculture --- are high-tech ones, depending for their productivity growth on large levels of R&D, well-educated engineers, technicians, and other workers, and continued high levels of investment. In pharmaceuticals, as I remember from a Congresional study I looked at about four years ago, the US has 80-85% of the world market.

    Some of the standardized processes --- such as assembling cell-phones --- have been transferred to countries like China.

    That's common for virtually all Chinese exported manufacturing goods: about 60-65% of the content used, including built-in technology, belong to the multinational firms implanted there. (The technical term for this is "pass-through" value. Again, when dealing with Chinese official data, these are estimates by specialists . . . a problem compounded by proprietary data of the firms.)

    ....

    An example, to stay with cell phones.

    The key technologies are patented to Qualcomm and Broadcomm, with Qualcomm suing just about every cell-phone producer in the world for violating its patents. It sued Nokia, which was already paying a fee to Qualcomm, for patent-violations in 2007 . . . only for the case to be sent to arbitration, and an eventual agreement last year in which Nokia agreed to pay $1 billion in past patent violations . . . as well as to work cordially in a new licensing agreement with Qualcomm.

    That was the case with Ericsson in Sweden earlier in the decade (before it merged with Sony), and with Japanese producers.

    On the other hand, Broadcomm won a suit against Qualcomm, though I forget who was suing who.

    ....

    As for airplane (civilian) production, Japan tried for two decades starting in the 1980s to build a competitive industry, and failed. Eurobus, a consortium, has done much better . . . with benefits to flying passengers world-wide. It has, though, stuck itself with a huge white-elephant in its new giant transport that can carry up to 700 or more passengers; is very fuel inefficient; and way behind schedule . . . with the partner governments bickering over how to handle the financial losses to date, and cut jobs.

    ....

    Hope this gives you some working idea anyway.

    Thanks for the query.

    Michael, the buggy professor

    ......

    2)

    Posted by: the buggy professor | Link to comment | April 21, 2009 at 12:43 PM

    the buggy professor says...

    KeN:

    Just noticed. There are two versions of the CIA Worldfactbook, and the figures above are from the text version . . . which groups exports by percentages slightly more coherently than the other version. Can't say why.

    Click here

    Buggy

    Posted by: the buggy professor | Link to comment | April 21, 2009 at 12:48 PM

    Cynthia says...

    Lafayatte,

    Paul Krugman and Dean Baker both point out that there's been a lot of phoniness in the America's productivity numbers, mainly due to all the phoniness in our financials. So if this is true, it can be safely (and sadly) said that over the past several decades or so Americans have been spinning their wheels big time while keeping their noses firmly to the grindstone.

    http://krugman.blogs.nytimes.com/2009/04/16/reconsidering-a-miracle/

    Posted by: Cynthia | Link to comment | April 21, 2009 at 01:58 PM

    ken melvin says...

    Buggy 4/22:
    My point being that in this the time of Cherry Blossom Festivals there was some cherry picking going on:
    E.g.:
    2) If jobs are the measure, then yes --- the percentage of the US workforce in manufacturing declined from about 35% in the early 1970s to around 12% in 2004.
    ----The per cent decline is: 23/35 = 66%, the number of jobs some .23 x 140million ~ 32million jobs.
    4) If the measure, though, is the dollar value of manufacturing output, it was at an all-time peak in 2006-07 at over $1.6 trillion . . . almost double the output a decade ago. According to Business Week yesterday,
    ----St. Louis Fed: http://research.stlouisfed.org/fred2/series/IPMAN shows a bit story - tremendous increase from 1990 to 2000, 2001 dip and an increase from 2001 to 2007 albeit at a much rate than from 1990 to 2000. I can find no evidence of the 'doubling' over the decade; in fact, the Chicago Fed: http://www.chicagofed.org/economic_research_and_data/cfmmi_data_series.cfm shows a -97 index of 99.0 and a 2007 index of 106.7 (presently: it's about 83.8%).

    5) If the measure is investment levels, note the astonishing pace in 2007 for US manufacturing (same Business Week source)
    "Not only is the U.S. still the world's leading manufacturer, but there are many good reasons that companies will continue to manufacture here and invest in new plants and equipment. According to the Census Bureau's 2007 Annual Capital Expenditures Survey, released on Jan. 22 of this year, U.S. nonfarm businesses invested $1.36 trillion in new and used structures and equipment in 2007, a 3.9 percent increase over 2006. More than $484 billion was spent on new structures alone."
    ---My read: Before 2000, manufacturing investment lead finance by ~ 2 to 1, by 2007, the ratio was almost 1 to 1, equipment to structure is trending from 2 to 1 to ~ 8/5, and, it was 2005 before investment got back to 2000 level.

    6) Enter manufacturing exports.
    And US export-manufactures were at an all-time peak in total value in 2007 as well. Note that they are heavily concentrated in capital goods, which in turn depend markedly on R&D, innovation (process or radical product), good marketing, and highly skilled labor . . . not to mention constant investment.. There is no reason to assume that such capital goods production will be easily transferred abroad, the way more standardized consumer-products have been.
    ---Everything's up to all nations, I'm guessing dollar: http://tse.export.gov/MapFrameset.aspx?MapPage=NTDMapDisplay.aspx&UniqueURL=ng1wed45cg0p2jfwi3xqo055-2009-4-22-8-2-13

    7) If the measure is the wage (plus benefits) of workers in manufacturing industry, it was almost double in inflation-adjusted terms last year compared to the early 1970s, when the industrial work force was three times larger as a percentage of total employment: about $66,000 vs. $37,000.
    ---If? No indication that there is any basis for this assertion that I can find or have heard of.

    links for 2009-04-22

    [Apr 3, 2009] William K. Black CSI Bailout PBS

    April 3, 2009 | Bill Moyers Journal

    William K. Black suspects that it was more than greed and incompetence that brought down the U.S. financial sector and plunged the economy in recession - it was fraud. And he would know. When it comes to financial shenanigans, William K. Black, the former senior regulator who cracked down on banks during the savings and loan crisis of the 1980s, has seen pretty much everything.

    Now an Associate Professor of Economics and Law at the University of Missouri, William K. Black tells Bill Moyers on the JOURNAL that the tool at the very center of mortgage collapse, creating triple-A rated bonds out of "liars' loans" - loans issued without verifying income, assets or employment - was a fraud, and the banks knew it.

    And while there is no law against liars' loans, Black points out that there are, "many laws against fraud, and liars' loans are fraudulent. [...] They involve deceit, which is the essence of fraud."

    Only the scale of the scandal is new. A single bank, IndyMac, lost more money than the entire Savings and Loan Crisis. The difference between now and then, explains Black, is a drastic reduction in regulation and oversight, "We now know what happens when you destroy regulation. You get the biggest financial calamity of anybody under the age of 80."

    More about the Savings and Loan Crisis

    Biography

    William K. Black, author of THE BEST WAY TO ROB A BANK IS TO OWN ONE, teaches economics and law at the University of Missouri - Kansas City (UMKC). He was the Executive Director of the Institute for Fraud Prevention from 2005-2007. He has taught previously at the LBJ School of Public Affairs at the University of Texas at Austin and at Santa Clara University, where he was also the distinguished scholar in residence for insurance law and a visiting scholar at the Markkula Center for Applied Ethics.

    Black was litigation director of the Federal Home Loan Bank Board, deputy director of the FSLIC, SVP and general counsel of the Federal Home Loan Bank of San Francisco, and senior deputy chief counsel, Office of Thrift Supervision. He was deputy director of the National Commission on Financial Institution Reform, Recovery and Enforcement.

    Black developed the concept of "control fraud" - frauds in which the CEO or head of state uses the entity as a "weapon." Control frauds cause greater financial losses than all other forms of property crime combined. He recently helped the World Bank develop anti-corruption initiatives and served as an expert for OFHEO in its enforcement action against Fannie Mae's former senior management.

    Published April 3, 2009. Guest photos by Robin Holland

    [Oct 12, 2007] Super Capitalism, Super Imperialism and Monetary Imperialism by Henry C K Liu

    Oct 12, 2007 | henryckliu.com

    PART 1: A Structural Link

    Robert B Reich, former US Secretary of Labor and resident neo-liberal in the Clinton administration from 1993 to 1997, wrote in the September 14, 2007 edition of The Wall Street Journal an opinion piece, "CEOs Deserve Their Pay", as part of an orchestrated campaign to promote his new book: Supercapitalism: The Transformation of Business, Democracy, and Everyday Life (Afred A Knopf). Hexter Professor of Social and Economic Policy at the Heller School for Social Policy and Management at Brandeis University. He is currently a professor at the Goldman School of Public Policy at the University of California (Berkley) and a regular liberal gadfly in the unabashed supply-side Larry Kudlow TV show that celebrates the merits of capitalism.

    Reich's Supercapitalism brings to mind Michael Hudson's Super Imperialism: The Economic Strategy of American Empire (1972-2003). While Reich, a liberal turned neo-liberal, sees "supercapitalism" as the natural evolution of insatiable shareholder appetite for gain, a polite euphemism for greed, that cannot or should not be reined in by regulation, Hudson, a Marxist heterodox economist, sees "super imperialism" as the structural outcome of post-World War II superpower geopolitics, with state interests overwhelming free market forces, making regulation irrelevant. While Hudson is critical of "super imperialism" and thinks that it should be resisted by the weaker trading partners of the US, Reich gives the impression of being ambivalent about the inevitability, if not the benignity, of "supercapitalism".

    The structural link between capitalism and imperialism was first observed by John Atkinson Hobson (1858-1940), an English economist, who wrote in 1902 an insightful analysis of the economic basis of imperialism. Hobson provided a humanist critique of neoclassical economics, rejecting exclusively materialistic definitions of value. With Albert Frederick Mummery (1855-1895), the great British mountaineer who was killed in 1895 by an avalanche while reconnoitering Nanga Parbat, an 8,000-meter Himalayan peak, Hobson wrote The Physiology of Industry (1889), which argued that an industrial economy requires government intervention to maintain stability, and developed the theory of over-saving that was given a glowing tribute by John Maynard Keynes three decades later.

    The need for governmental intervention to stabilize an expanding national industrial economy was the rationale for political imperialism. On the other side of the coin, protectionism was a governmental counter-intervention on the part of weak trading partners for resisting imperialist expansion of the dominant power. Historically, the processes of globalization have always been the result of active state policy and action, as opposed to the mere passive surrender of state sovereignty to market forces. Market forces cannot operate in a vacuum. They are governed by man-made rules. Globalized markets require the acceptance by local authorities of established rules of the dominant economy. Currency monopoly of course is the most fundamental trade restraint by one single dominant government.

    Adam Smith published Wealth of Nations in 1776, the year of US independence. By the time the constitution was framed 11 years later, the US founding fathers were deeply influenced by Smith's ideas, which constituted a reasoned abhorrence of trade monopoly and government policy in restricting trade. What Smith abhorred most was a policy known as mercantilism, which was practiced by all the major powers of the time. It is necessary to bear in mind that Smith's notion of the limitation of government action was exclusively related to mercantilist issues of trade restraint. Smith never advocated government tolerance of trade restraint, whether by big business monopolies or by other governments in the name of open markets.

    A central aim of mercantilism was to ensure that a nation's exports remained higher in value than its imports, the surplus in that era being paid only in specie money (gold-backed as opposed to fiat money). This trade surplus in gold permitted the surplus country, such as England, to invest in more factories at home to manufacture more for export, thus bringing home more gold. The importing regions, such as the American colonies, not only found the gold reserves backing their currency depleted, causing free-fall devaluation (not unlike that faced today by many emerging-economy currencies), but also wanting in surplus capital for building factories to produce for domestic consumption and export. So despite plentiful iron ore in America, only pig iron was exported to England in return for English finished iron goods. The situation was similar to today's oil producing countries where despite plentiful crude oil, refined petrochemical products such as gasoline and heating oil have to be imported.

    In 1795, when the newly independent Americans began finally to wake up to their disadvantaged trade relationship and began to raise European (mostly French and Dutch) capital to start a manufacturing industry, England decreed the Iron Act, forbidding the manufacture of iron goods in its American colonies, which caused great dissatisfaction among the prospering colonials. Smith favored an opposite government policy toward promoting domestic economic production and free foreign trade for the weaker traders, a policy that came to be known as "laissez faire" (because the English, having nothing to do with such heretical ideas, refuse to give it an English name). Laissez faire, notwithstanding its literal meaning of "leave alone", meant nothing of the sort. It meant an activist government policy to counteract mercantilism. Neo-liberal free-market economists are just bad historians, among their other defective characteristics, when they propagandize "laissez faire" as no government interference in trade affairs.

    Friedrich List, in his National System of Political Economy (1841), asserts that political economy as espoused in England, far from being a valid science universally, was merely British national opinion, suited only to English historical conditions. List's institutional school of economics asserts that the doctrine of free trade was devised to keep England rich and powerful at the expense of its trading partners and it must be fought with protective tariffs and other protective devices of economic nationalism by the weaker countries.

    Henry Clay's "American system" was a national system of political economy. US neo-imperialism in the post WWII period disingenuously promotes neo-liberal free-trade against governmental protectionism to keep the US rich and powerful at the expense of its trading partners. Before the October Revolution of 1917, many national liberation movements in European colonies and semi-colonies around the world were influenced by List's economic nationalism. The 1911 Nationalist Revolution in China, led by Sun Yat-sen, was heavily influenced by Lincoln's political ideas - government of the people, by the people and for the people - and the economic nationalism of List, until after the October Revolution when Sun realized that the Soviet model was the correct path to national revival.

    Hobson's magnum opus, Imperialism, (1902), argues that imperialistic expansion is driven not by state hubris, known in US history as "manifest destiny", but by an innate quest for new markets and investment opportunities overseas for excess capital formed by over-saving at home for the benefit of the home state. Over-saving during the industrial age came from Richardo's theory of the iron law of wages, according to which wages were kept perpetually at subsistence levels as a result of uneven market power between capital and labor. Today, job outsourcing that returns as low-price imports contributes to the iron law of wages in the US domestic economy. (See my article Organization of Labor Exporting Countries [OLEC]).

    Hobson's analysis of the phenology (study of life cycles) of capitalism was drawn upon by Lenin to formulate a theory of imperialism as an advanced stage of capitalism: "Imperialism is capitalism at that stage of development at which the dominance of monopolies and finance capitalism is established; in which the export of capital has acquired pronounced importance; in which the division of the world among the international trusts has begun, in which the division of all territories of the globe among the biggest capitalist powers has been completed." (Vladimir Ilyich Lenin, 1916, Imperialism, the Highest Stage of Capitalism, Chapter 7).

    Lenin was also influenced by Rosa Luxemberg, who three year earlier had written her major work, The Accumulation of Capital: A Contribution to an Economic Explanation of Imperialism (Die Akkumulation des Kapitals: Ein Beitrag zur ökonomischen Erklärung des Imperialismus), 1913). Luxemberg, together with Karl Liebknecht a founding leader of the Spartacist League (Spartakusbund), a radical Marxist revolutionary movement that later renamed itself the Communist Party of Germany (Kommunistische Partei Deutschlands, or KPD), was murdered on January 15, 1919 by members of the Freikorps, rightwing militarists who were the forerunners of the Nazi Sturmabteilung (SA) led by Ernst Rohm.

    The congenital association between capitalism and imperialism requires practically all truly anti-imperialist movements the world over to be also anti-capitalist. To this day, most nationalist capitalists in emerging economies are unwitting neo-compradors for super imperialism. Neo-liberalism, in its attempts to break down all national boundaries to facilitate global trade denominated in fiat dollars, is the ideology of super imperialism.

    Hudson, the American heterodox economist, historian of ancient economies and post-WW II international balance-of-payments specialist, advanced in his 1972 book the notion of 20th century super imperialism. Hudson updated Hobson's idea of 19th century imperialism of state industrial policy seeking new markets to invest home-grown excess capital. To Hudson, super imperialism is a state financial strategy to export debt denominated in the state's fiat currency as capital to the new financial colonies to finance the global expansion of a superpower empire. No necessity, or even intention, was entertained by the superpower of ever having to pay off these paper debts after the US dollar was taken off gold in 1971.

    Monetary Imperialism and Dollar Hegemony

    Super imperialism transformed into monetary imperialism after the 1973 Middle East oil crisis with the creation of the petrodollar and two decades later emerged as dollar hegemony through financial globalization after 1993. As described in my 2002 AToL article, Dollar hegemony has to go, a geopolitical phenomenon emerged after the 1973 oil crisis in which the US dollar, a fiat currency since 1971, continues to serve as the primary reserve currency for international trade because oil continues to be denominated in fiat dollars as a result of superpower geopolitics, leading to dollar hegemony in 1993 with the globalization of deregulated financial markets.

    Three causal developments allowed dollar hegemony to emerge over a span of two decades after 1973 and finally take hold in 1993. US fiscal deficits from overseas spending since the 1950s caused a massive drain in US gold holdings, forcing the US in 1971 to abandon the 1945 Bretton Woods regime of fixed exchange rate based on a gold-backed dollar. Under that international financial architecture, cross-border flow of funds was not considered necessary or desirable for promoting international trade or domestic development. The collapse of the 1945 Bretton Woods regime in 1971 was the initial development toward dollar hegemony.

    The second development was the denomination of oil in dollars after the 1973 Middle East oil crisis. The emergence of petrodollars was the price the US, still only one of two contending superpowers in 1973, extracted from defenseless oil-producing nations for allowing them to nationalize the Western-owned oil industry on their soil. As long as oil transactions are denominated in fiat dollars, the US essentially controls all the oil in the world financially regardless of specific ownership, reducing all oil producing nations to the status of commodity agents of dollar hegemony.

    The third development was the global deregulation of financial markets after the Cold War, making cross-border flow of funds routine, and a general relaxation of capital and foreign exchange control by most governments involved in international trade. This neo-liberal trade regime brought into existence a foreign exchange market in which free-floating exchange rates made computerized speculative attacks on weak currencies a regular occurrence. These three developments permitted the emergence of dollar hegemony after 1994 and helped the US win the Cold War with financial power derived from fiat money.

    Dollar hegemony advanced super imperialism one stage further from the financial to the monetary front. Industrial imperialism sought to achieve a trade surplus by exporting manufactured good to the colonies for gold to fund investment for more productive plants at home. Super imperialism sought to extract real wealth from the colonies by paying for it with fiat dollars to sustain a balance of payments out of an imbalance in the exchange of commodities. Monetary imperialism under dollar hegemony exports debt denominated in fiat dollars through a permissive trade deficit with the new colonies, only to re-import the debt back to the US as capital account surplus to finance the US debt bubble.

    The circular recycling of dollar-denominated debt was made operative by the dollar, a fiat currency that only the US can print at will, continuing as the world's prime reserve currency for international trade and finance, backed by US geopolitical superpower. Dollars are accepted universally because oil is denominated in dollars and everyone needs oil and thus needs dollars to buy oil. Any nation that seeks to denominate key commodities, such as oil, in currencies other than the dollar will soon find itself invaded by the sole superpower. Thus the war on Iraq is not about oil, as former Federal Reserve chairman Alan Greenspan suggested recently. It is about keeping oil denominated in dollars to protect dollar hegemony. The difference is subtle but of essential importance.

    Since 1993, central banks of all trading nations around the world, with the exception of the US Federal Reserve, have been forced to hold more dollar reserves than they otherwise need to ward off the potential of sudden speculative attacks on their currencies in unregulated global financial markets. Thus "dollar hegemony" prevents the exporting nations, such as the Asian Tigers, from spending domestically the dollars they earn from the US trade deficit and forces them to fund the US capital account surplus, shipping real wealth to the US in exchange for the privilege of financing further growth of the US debt economy.

    Not only do these exporting nations have to compete by keeping their domestic wages down and by prostituting their environment, the dollars that they earn cannot be spent at home without causing a monetary crisis in their own currencies because the dollars they earn have to be exchanged into local currencies before they can be spent domestically, causing an excessive rise in their domestic money supply which in turn causes domestic inflation-pushed bubbles. While the trade-surplus nations are forced to lend their export earnings back to the US, these same nations are starved for capital, as global capital denominated in dollars will only invest in their export sectors to earn more dollars. The domestic sector with local currency earnings remains of little interest to global capital denominated in dollars. As a result, domestic development stagnates for lack of capital.

    Dollar hegemony permits the US to transform itself from a competitor in world markets to earn hard money, to a fiat-money-making monopoly with fiat dollars that only it can print at will. Every other trading nation has to exchange low-wage goods for dollars that the US alone can print freely and that can be spent only in the dollar economy without monetary penalty.

    The victimization of Japan and China

    Japan is a classic victim of monetary imperialism. In 1990, as a result of Japanese export prowess, the Industrial Bank of Japan was the largest bank in the world, with a market capitalization of $57 billion. The top nine of the 10 largest banks then were all Japanese, trailed by Canadian Alliance in 10th place. No US bank made the top-10 list. By 2001, the effects of dollar hegemony have pushed Citigroup into first place with a market capitalization of $260 billion. Seven of the top 10 largest financial institutions in the world in 2001 were US-based, with descending ranking in market capitalization: Citigroup ($260 billion), AIG ($209 billion), HSBC (British-$110 billion), Berkshire Hathaway ($100 billion), Bank of America ($99 billion), Fanny Mae ($80 billion), Wells Fargo ($74 billion), JP Morgan Chase ($72 billion), RBS (British-$70 billion) and UBS (Swiss-$67 billion). No Japanese bank survived on the list.

    China is a neoclassic case of dollar hegemony victimization even though its domestic financial markets are still not open and the yuan is still not freely convertible. With over $1.4 trillion in foreign exchange reserves earned at a previously lower fixed exchange rate of 8.2 to a dollar set in 1985, now growing at the rate of $1 billion a day at a narrow-range floating exchange rate of around 7.5 since July 2005, China cannot spend much of it dollar holdings on domestic development without domestic inflation caused by excessive expansion of its yuan money supply. The Chinese economy is overheating because the bulk of its surplus revenue is in dollars from exports that cannot be spent inside China without monetary penalty. Chinese wages are too low to absorb sudden expansion of yuan money supply to develop the domestic economy. And with over $1.4 trillion in foreign exchange reserves, equal to its annual GDP, China cannot even divest from the dollar without having the market effect of a falling dollar moving against its remaining holdings.

    The People's Bank of China announced on July 20, 2005 that effective immediately the yuan exchange rate would go up by 2.1% to 8.11 yuan to the US dollar and that China would drop the dollar peg to its currency. In its place, China would move to a "managed float" of the yuan, pegging the currency's exchange value to an undisclosed basket of currencies linked to its global trade. In an effort to limit the amount of volatility, China would not allow the currency to fluctuate by more than 0.3% in any one trading day. Linking the yuan to a basket of currencies means China's currency is relatively free from market forces acting on the dollar, shifting to market forces acting on a basket of currencies of China's key trading partners. The basket is composed of the euro, yen and other Asian currencies as well as the dollar. Though the precise composition of the basket was not disclosed, it can nevertheless be deduced by China's trade volume with key trading partners and by mathematical calculation from the set-daily exchange rate.

    Thus China is trapped in a trade regime operating on an international monetary architecture in which it must continue to export real wealth in the form of underpaid labor and polluted environment in exchange for dollars that it must reinvest in the US. Ironically, the recent rise of anti-trade sentiment in US domestic politics offers China a convenient, opportune escape from dollar hegemony to reduce its dependence on export to concentrate on domestic development. Chinese domestic special interest groups in the export sector would otherwise oppose any policy to slow the growth in export if not for the rise of US protectionism which causes shot-term pain for China but long-term benefit in China's need to restructure its economy toward domestic development. Further trade surplus denominated in dollar is of no advantage to China.

    Emerging markets are new colonies of monetary imperialism

    Even as the domestic US economy declined after the onset of globalization in the early 1990s, US dominance in global finance has continued to this day on account of dollar hegemony. It should not be surprising that the nation that can print at will the world's reserve currency for international trade should come up on top in deregulated global financial markets. The so-called emerging markets around the world are the new colonies of monetary imperialism in a global neo-liberal trading regime operating under dollar hegemony geopolitically dominated by the US as the world's sole remaining superpower.

    Denial of corporate social responsibility

    In Supercapitalism, Reich identifies corporate social responsibility as a diversion from economic efficiency and an un-capitalistic illusion. Of course the late Milton Friedman had asserted that the only social responsibility of corporations is to maximize profit, rather than to generate economic well-being and balanced growth through fair profits. There is ample evidence to suggest that a single-minded quest for maximizing global corporate profit can lead to domestic economic decline in even the world's sole remaining superpower. The US public is encouraged to blame such decline on the misbehaving trading partners of the US rather than US trade policy that permits US transnational corporation to exploit workers in all trading nations, including those in the US. It is a policy that devalues work by over-rewarding financial manipulation.

    Yet to Reich, the US corporate income tax is regressive and inequitable and should be abolished so that after-tax corporate profit can be even further enhanced. This pro-profit position is at odds with even rising US Republican sentiment against transnational corporations and their global trade strategies. Reich also thinks the concept of corporate criminal liability is based on an "anthropomorphic fallacy" that ends up hurting innocent people. Reich sees as inevitable an evolutionary path towards an allegedly perfect new world of a super-energetic capitalism responding to the dictate of all-powerful consumer preference through market democracy.

    Reich argues that corporations cannot be expected to be more "socially responsible" than their shareholders or even their consumers, and he implies that consumer preference and behavior are the proper and effective police forces that supersede the need for market regulation. He sees corporations, while viewed by law as "legal persons", as merely value-neutral institutional respondents of consumer preferences in global markets. Reich claims that corporate policies, strategies and behavior in market capitalism are effectively governed by consumer preferences and need no regulation by government. This is essentially the ideology of neo-liberalism.

    Yet US transnational corporations derive profit from global operations serving global consumers to maximize return on global capital. These transnational corporations will seek to shift production to where labor is cheapest and environmental standards are lowest and to market their products where prices are highest and consumer purchasing power the strongest. Often, these corporations find it more profitable to sell products they themselves do not make, controlling only design and marketing, leaving the dirty side of manufacturing to others with underdeveloped market power. This means if the US wants a trade surplus under the current terms of trade, it must lower it wages. The decoupling of consumers from producers weakens the conventional effects of market pressure on corporate social responsibility. Transnational corporations have no home community loyalty. Consumers generally do not care about sweat shop conditions overseas while overseas workers do not care about product safety on goods they produce but cannot afford to buy. Products may be made in China, but they are not made by China, but by US transnational corporations which are responsible for the quality and safety of their products.

    Further, it is well recognized that corporations routinely and effectively manipulate consumer preference and market acceptance often through if not false, at least misleading advertising, not for the benefit of consumers, but to maximize return on faceless capital raised from global capital markets. The subliminal emphasis by the corporate culture on addictive acquisition of material things, coupled with a structural deprivation of adequate income to satisfy the manipulated desires, has made consumers less satisfied than in previous times of less material abundance. Corporations have been allowed to imbed consumption-urging messages into every aspect of modern life. The result is a disposable culture with packaged waste, an obesity crisis for all age groups, skyrocketing consumer debt, the privatization of public utilities that demand the same fee for basic services from rich and poor alike, causing a sharp disparity in affordability. It is a phenomenon described by Karl Marx as "Fetishism of Commodities".

    Marx's concept of Fetishism of Commodities

    Marx wrote in Das Kapital:[1]

    The relation of the producers to the sum total of their own labor is presented to them as a social relation, existing not between themselves, but between the products of their labor. This is the reason why the products of labor become commodities, social things whose qualities are at the same time perceptible and imperceptible by the senses … The existence of the things qua commodities, and the value relation between the products of labor which stamps them as commodities, have absolutely no connection with their physical properties and with the material relations arising therefrom. It is a definite social relation between men that assumes, in their eyes, the fantastic form of a relation between things. In order, therefore, to find an analogy, we must have recourse to the mist-enveloped regions of the religious world. In that world, the productions of the human brain appear as independent beings endowed with life, and entering into relation both with one another and the human race. So it is in the world of commodities with the products of men's hands. This I call the Fetishism which attaches itself to the products of labor, as soon as they are produced as commodities, and which is therefore inseparable from the production of commodities. This Fetishism of Commodities has its origin … in the peculiar social character of the labor that produces them.
    Marx asserts that "the mystical character of commodities does not originate in their use-value" (Section 1, p 71). Market value is derived from social relations, not from use-value which is a material phenomenon. Thus Marx critiques the Marginal Utility Theory by pointing out that market value is affected by social relationships. For example, the marginal utility of door locks is a function of the burglary rate in a neighborhood which in turn is a function of the unemployment rate. Unregulated free markets are a regime of uninhibited price gouging by monopolies and cartels.

    Thus the nature of money cannot be adequately explained even in terms of the material-technical properties of gold, but only in terms of the factors behind man's desire and need for gold. Similarly, it is not possible to fully understand the price of capital from the technical nature of the means of production, but only from the social institution of private ownership and the terms of exchange imposed by uneven market power. Market capitalism is a social institution based on the fetishism of commodities.

    Democracy threatened by the corporate state

    While Reich is on target in warning about the danger to democracy posed by the corporate state, and in claiming that only people can be citizens, and only citizens should participate in democratic decision making, he misses the point that transnational corporations have transcended national boundaries. Yet in each community that these transnational corporations operate, they have the congenital incentive, the financial means and the legal mandate to manipulate the fetishism of commodities even in distant lands.

    Moreover, representative democracy as practiced in the US is increasingly manipulated by corporate lobbying funded from high-profit-driven corporate financial resources derived from foreign sources controlled by management. Corporate governance is notoriously abusive of minority shareholder rights on the part of management. Notwithstanding Reich's rationalization of excessive CEO compensation, CEOs as a class are the most vocal proponents of corporate statehood. Modern corporations are securely insulated from any serious threats from consumer revolt. Inter-corporate competition presents only superficial and trivial choices for consumers. Motorists have never been offered any real choice on gasoline by oil companies or alternatives on the gasoline-guzzling internal combustion engine by car-makers.

    High pay for CEOs

    Reich asserts in his Wall Street Journal piece that modern CEOs in finance capitalism nowadays deserve their high pay because they have to be superstars, unlike their bureaucrat-like predecessors during industrial capitalism. Notwithstanding that one would expect a former labor secretary to argue that workers deserve higher pay, the challenge to corporate leadership in market capitalism has always been and will always remain management's ruthless pursuit of market leadership power, a euphemism for monopoly, by skirting the rule of law and regulations, framing legislative regimes through political lobbying, pushing down wages and worker benefits, increasing productivity by downsizing in an expanding market and manipulating consumer attitude through advertising. At the end of the day, the bottom line for corporate profit is a factor of lowering wage and benefit levels.

    Reich seems to have forgotten that the captains of industry of 19th century free-wheeling capitalism were all superstars who evoked public admiration by manipulating the awed public into accepting the Horatio Alger myth of success through hard work, honesty and fairness. The derogatory term "robber barons" was first coined by protest pamphlets circulated by victimized Kansas farmers against ruthless railroad tycoons during the Great Depression.

    The manipulation of the public will by moneyed interests is the most problematic vulnerability of US economic and political democracy. In an era when class warfare has taken on new sophistication, the accusation of resorting to class warfare argument is widely used to silence legitimate socio-economic protests. The US media is essentially owned by the moneyed interests. The decline of unionism in the US has been largely the result of anti-labor propaganda campaigns funded by corporations and government policies influenced by corporate lobbyists. The infiltration of organized crime was exploited to fan public anti-union sentiments while widespread corporate white collar crimes were dismissed as mere anomalies. (See Capitalism's bad apples: It's the barrel that's rotten)

    Superman capitalism

    As promoted by his permissive opinion piece, a more apt title for Reich's new book would be Superman Capitalism, in praise of the super-heroic qualities of successful corporate CEOs who deserve superstar pay. This view goes beyond even fascist superman ideology. The compensation of corporate CEOs in Nazi Germany never reached such obscene levels as those in US corporate land today.

    Reich argues that CEOs deserve their super-high compensation, which has increased 600% in two decades, because corporate profits have also risen 600% in the same period. The former secretary of labor did not point out that wages rose only 30% in the same period. The profit/wage disparity is a growing cancer in the US-dominated global economy, causing over-production resulting from stagnant demand caused by inadequate wages. A true spokesman for labor would point out that enlightened modern management recognizes that the performance of a corporation is the sum total of effective team work between management and labor.

    System analysis has long shown that collective effort on the part of the entire work force is indispensable to success in any complex organism. Further, a healthy consumer market depends on a balance between corporate earnings and worker earnings. Reich's point would be valid if US wages had risen by the same multiple as CEO pay and corporate profit, but he apparently thought that it would be poor etiquette to raise embarrassing issues as a guest writer in an innately anti-labor journal of Wall Street. Even then, unless real growth also rose 600% in two decades, the rise in corporate earning may be just an inflation bubble.

    An introduction to economic populism

    To be fair, Reich did address the income gap issue eight months earlier in another article, "An Introduction to Economic Populism" in the Jan-Feb, 2007 issue of The American Prospect, a magazine that bills itself as devoted to "liberal ideas". In that article, Reich relates a "philosophical" discussion he had with fellow neo-liberal cabinet member Robert Rubin, then treasury secretary under Bill Clinton, on two "simple questions".

    The first question was: Suppose a proposed policy will increase the incomes of some people without decreasing the incomes of any others. Of course Reich must know that it is a question of welfare economics long ago answered by the "pareto optimum", which asserts that resources are optimally distributed when an individual cannot move into a better position without putting someone else into a worse position. In an unjust society, the pareto optimum will perpetuate injustice in the name of optimum resource allocation. "Should it be implemented? Bob and I agreed it should," writes Reich. Not exactly an earth-shaking liberal position. Rather, it is a classic neo-liberal posture.

    And the second question: But suppose the people whose incomes will rise are already wealthier than everyone else. Although no one will lose ground, inequality will widen. Should it still be implemented? "I won't tell you where he and I came out on that second question," writes Reich without explaining why. He allows that "we agreed that people who don't share in such gains feel relatively poorer. Widening inequality also further tips the balance of political power in favor of the wealthy."

    Of course, clear thinking would have left the second question mute because it would have invalidated the first question, as the real income of those whose nominal income has not fallen has indeed fallen relative to those whose nominal income has risen. In a macro monetary sense, it is not possible to raise the nominal income of some without lowering the real income of others. All incomes must rise together proportionally or inequality in after-inflation real income will increase.

    Inequality only a new worry?

    But for the sake of argument, let's go along with Reich's parable on welfare economics and financial equality. That conversation occurred a decade ago. Reich says in his January 2007 article that "inequality is far more worrisome now", as if it had not been or that the policies he and his colleagues in the Clinton administration, as evidenced by their answer to their own first question, did not cause the now "more worrisome" inequality. "The incomes of the bottom 90% of Americans have increased about 2% in real terms since then, while that of the top 1% has increased over 50%," Reich wrote in the matter of fact tone of an innocent bystander.

    It is surprising that a former labor secretary would err even on the record on worker income. The US Internal Revenue Service reports that while incomes have been rising since 2002, the average income in 2005 was $55,238, nearly 1% less than in 2000 after adjusting for inflation. Hourly wage costs (including mandatory welfare contributions and benefits) grew more slowly than hourly productivity from 1993 to late 1997, the years of Reich's tenure as labor secretary. Corporate profit rose until 1997 before declining, meaning what should have gone to workers from productivity improvements went instead to corporate profits. And corporate profit declined after 1997 because of the Asian financial crisis, which reduced offshore income for all transnational companies, while domestic purchasing power remained weak because of sub-par worker income growth.

    The break in trends in wages occurred when the unemployment rate sank to 5%, below the 6% threshold of NAIRU (non-accelerating inflation rate of unemployment) as job creation was robust from 1993 onwards. The "reserve army of labor" in the war against inflation disappeared after the 1997 Asian crisis when the Federal Reserve injected liquidity into the US banking system to launch the debt bubble. According to NAIRU, when more than 94% of the labor force is employed, the war on wage-pushed inflation will be on the defensive. Yet while US inflation was held down by low-price imports from low-wage economies, US domestic wages fell behind productivity growth from 1993 onward. US wages could have risen without inflationary effects but did not because of the threat of further outsourcing of US jobs overseas. This caused corporate profit to rise at the expense of labor income during the low-inflation debt bubble years.

    Income inequality in the US today has reached extremes not seen since the 1920s, but the trend started three decades earlier. More than $1 trillion a year in relative income is now being shifted annually from roughly 90,000,000 middle and working class families to the wealthiest households and corporations via corporate profits earned from low-wage workers overseas. This is why nearly 60% of Republicans polled support more taxes on the rich.

    Carter the granddaddy of deregulation

    The policies and practices responsible for today's widening income gap date back to the 1977-1981 period of the Carter administration which is justly known as the administration of deregulation. Carter's deregulation was done in the name of populism but the results were largely anti-populist. Starting with Carter, policies and practices by both corporations and government underwent a fundamental shift to restructure the US economy with an overhaul of job markets. This was achieved through widespread de-unionization, breakup of industry-wide collective bargaining which enabled management to exploit a new international division of labor at the expense of domestic workers.

    The frontal assault on worker collective bargaining power was accompanied by a realigning of the progressive federal tax structure to cut taxes on the rich, a brutal neo-liberal global free-trade offensive by transnational corporations and anti-labor government trade policies. The cost shifting of health care and pension plans from corporations to workers was condoned by government policy. A wave of government-assisted compression of wages and overtime pay narrowed the wage gap between the lowest and highest paid workers (which will occur when lower-paid workers receive a relatively larger wage increase than the higher-paid workers with all workers receiving lower pay increases than managers). There was a recurring diversion of inflation-driven social security fund surpluses to the US fiscal budget to offset recurring inflation-adjusted federal deficits. This was accompanied by wholesale anti-trust deregulation and privatization of public sectors; and most egregious of all, financial market deregulation.

    Carter deregulated the US oil industry four years after the 1973 oil crisis in the name of national security. His Democratic challenger, Senator Ted Kennedy, advocated outright nationalization. The Carter administration also deregulated the airlines, favoring profitable hub traffic at the expense of traffic to smaller cities. Air fares fell but service fell further. Delays became routine, frequently tripling door-to-door travel time. What consumers save in airfare, they pay dearly in time lost in delay and in in-flight discomfort. The Carter administration also deregulated trucking, which caused the Teamsters Union to support Ronald Reagan in exchange for a promise to delay trucking deregulation.

    Railroads were also deregulated by Railroad Revitalization and Regulatory Reform Act of 1976 which eased regulations on rates, line abandonment, and mergers to allow the industry to compete with truck and barge transportation that had caused a financial and physical deterioration of the national rail network railroads. Four years later, Congress followed up with the Staggers Rail Act of 1980 which provided the railroads with greater pricing freedom, streamlined merger timetables, expedited the line abandonment process, and allowed confidential contracts with shippers. Although railroads, like other modes of transportation, must purchase and maintain their own rolling stock and locomotives, they must also, unlike competing modes, construct and maintain their own roadbed, tracks, terminals, and related facilities. Highway construction and maintenance are paid for by gasoline taxes. In the regulated environment, recovering these fixed costs hindered profitability for the rail industry.

    After deregulation, the railroads sought to enhance their financial situation and improve their operational efficiency with a mix of strategies to reduce cost and maximize profit, rather than providing needed service to passengers around the nation. These strategies included network rationalization by shedding unprofitable capacity, raising equipment and operational efficiencies by new work rules that reduced safety margins and union power, using differential pricing to favor big shippers, and pursuing consolidation, reducing the number of rail companies from 65 to 5 today. The consequence was a significant increase of market power for the merged rail companies, decreasing transportation options for consumers and increasing rates for remote, less dense areas.

    In the agricultural sector, rail network rationalization has forced shippers to truck their bulk commodity products greater distances to mainline elevators, resulting in greater pressure on and damage to rural road systems. For inter-modal shippers, profit-based network rationalization has meant reduced access - physically and economically - to Container on Flat Car (COFC) and Trailer on Flat Car (TOFC) facilities and services. Rail deregulation, as is true with most transportation and communication deregulation, produces sector sub-optimization with dubious benefits for the national economy by distorting distributional balance, causing congestion and inefficient use of land, network and lines.

    Carter's Federal Communications Commission's (FCC) approach to radio and television regulation began in the mid-1970s as a search for relatively minor "regulatory underbrush" that could be
    cleared away for more efficient and cost-effective administration of the important rules that would remain. Congress largely went along with this updating trend, and initiated a few deregulatory moves of its own to make regulation more effective and responsive to contemporary conditions.

    Reagan's anti-government fixation

    The Reagan administration under Federal Communications Commission (FCC) chairman Mark Fowler in 1981 shifted deregulation to a fundamental and ideologically-driven reappraisal of regulations away from long-held principles central to national broadcasting policy appropriate for a democratic society. The result was removal of many longstanding rules to permit an overall reduction in FCC oversight of station ownership concentration and network operations. Congress grew increasingly wary of the pace of deregulation, however, and began to slow the pace of FCC deregulation by the late 1980s.

    Specific deregulatory moves included (a) extending television licenses to five years from three in 1981; (b) expanding the number of television stations any single entity could own from seven in 1981 to 12 in 1985, with further changes in 1995; (c) abolishing guidelines for minimal amounts of non-entertainment programming in 1985; (d) elimination of the Fairness Doctrine in 1987; (e) dropping, in 1985, FCC license guidelines for how much advertising could be carried; (f) leaving technical standards increasingly in the hands of licensees rather than FCC mandates; and (g) deregulation of television's competition, especially cable which went through several regulatory changes in the decade after 1983.

    The 1996 Telecommunications Act eliminated the 40-station ownership cap on radio stations. Since then, the radio industry has experienced unprecedented consolidation. In June 2003, the FCC voted to overhaul limits on media ownership. Despite having held only one hearing on the complex issue of media consolidation over a 20-month review period, the FCC, in a party-line vote, voted 3-2 to overhaul limits on media concentration. The rule would (1) increase the aggregate television ownership cap to enable one company to own stations reaching 45% of our nation's homes (from 35%), (2) lift the ban on newspaper-television cross-ownership, and (3) allow a single company to own three television stations in large media markets and two in medium ones. In the largest markets, the rule would allow a single company to own up to three television stations, eight radio stations, the cable television system, cable television stations, and a daily newspaper. A wide range of public-interest groups filed an appeal with the Third Circuit, which stayed the effective date of the new rules.

    According to a BIA Financial Network report released in July 2006, a total of 88 television stations had been sold in the first six months of 2006, generating a transaction value of $15.7 billion. In 2005, the same period saw the sale of just 21 stations at a value of $244 million, with total year transactions of $2.86 billion.

    Congress passed a law in 2004 that forbids any network to own a group of stations that reaches more than 39% of the national television audience. That is lower than the 45% limit set in 2003, but more than the original cap of 35% set in 1996 under the Clinton administration - leading public interest groups to argue that the proposed limits lead to a stifling of local voices.

    Newspaper-television cross-ownership remains a contentious issue. Currently prohibited, it refers to the "common ownership of a full-service broadcast station and a daily newspaper when the broadcast station's area of coverage (or "contour") encompasses the newspaper's city of publication".

    Capping of local radio and television ownership is another issue. While the original rule prohibited it, currently a company can own at least one television and one radio station in a market. In larger markets, "a single entity may own additional radio stations depending on the number of other independently owned media outlets in the market".

    Most broadcasters and newspaper publishers are lobbying to ease or end restrictions on cross-ownership; they say it has to be the future of the news business. It allows newsgathering costs to be spread across platforms, and delivers multiple revenue streams in turn. Their argument is also tied to a rapidly changing media consumption market, and to the diversity of opinions available to the consumer with the rise of the Internet and other digital platforms.

    The arguments against relaxing media ownership regulations are put forth by consumer unions and other interest groups on the ground that consolidation in any form inevitably leads to a lack of diversity of opinion. Cross-ownership limits the choices for consumers, inhibits localism and gives excessive media power to one entity.

    Professional and workers' guilds of the communication industry (the Screen Actors Guild and American Federation of TV and Radio Artists among others) would like the FCC to keep in mind the independent voice, and want a quarter of all prime-time programming to come from independent producers. The Children's Media Policy Coalition suggested that the FCC limit local broadcasters to a single license per market, so that there is enough original programming for children. Other interest groups like the National Association of Black Owned Broadcasters are worried about what impact the rules might have on station ownership by minorities.

    Deregulatory proponents see station licensees not as "public trustees" of the public airwaves requiring the provision of a wide variety of services to many different listening groups. Instead, broadcasting has been increasingly seen as just another business operating in a commercial marketplace which did not need its management decisions questioned by government overseers, even though they are granted permission to use public airways. Opponents argue that deregulation violates a key mandate of the Communications Act of 1934 which requires licensees to operate in the public interest. Deregulation allows broadcasters to seek profits with little public service programming.

    Clinton and telecommunications deregulation

    The Telecommunications Act of 1996 was the first major overhaul of US telecommunications law in nearly 62 years, amending the Communications Act of 1934, and leading to media consolidation. It was approved by Congress on January 3, 1996 and signed into law on February 8, 1996 by President Clinton, a Democrat whom some have labeled as the best president the Republicans ever had.

    The act claimed to foster competition, but instead it continued the historic industry consolidation begun by Reagan, whose actions reduced the number of major media companies from around 50 in 1983 to 10 in 1996 and 6 in 2005.

    Regulation Q

    The Carter administration increased the power of the Federal Reserve through the Depository Institutions and Monetary Control Act (DIDMCA) of 1980 which was a necessary first step in ending the New Deal restrictions placed upon financial institutions, such as Regulation Q put in place by the Glass-Steagall Act of 1933 and other restrictions on banks and financial institutions.

    The populist Regulation Q imposed limits and ceilings on bank and savings-and-loan (S&L) interest rates to provide funds for low-risk home mortgages.

    But with financial market deregulation, Regulation Q created incentives for US banks to do business outside the reach of US law, launching finance globalization. London came to dominate this offshore dollar business.

    The populist Regulation Q, which regulated for several decades limits and ceilings on bank and S&L interest to serve the home mortgage sector, was phased out completely in March 1986. Banks were allowed to pay interest on checking account - the NOW accounts - to lure depositors back from the money markets. The traditional interest-rate advantage of the S&Ls was removed, to provide a "level playing field", forcing them to take the same risks as commercial banks to survive. Congress also lifted restrictions on S&Ls' commercial lending, which promptly got the whole industry into trouble that would soon required an unprecedented government bailout of depositors, with tax money. But the developers who made billions from easy credit were allowed to keep their profits. State usury laws were unilaterally suspended by an act of Congress in a flagrant intrusion on state rights. Carter, the well-intentioned populist, left a legacy of anti-populist policies. To this day, Greenspan continues to argue disingenuously that subprime mortgages helped the poor toward home ownership, instead of generating obscene profit for the debt securitization industry.

    The party of Lincoln taken over by corporate interests

    During the Reagan administration, corporate lobbying and electoral strategies allowed the corporate elite to wrest control of the Republican Party, the party of Lincoln, from conservative populists.

    In the late 1980s, supply-side economics was promoted to allow corporate interests to dominate US politics at the expense of labor by arguing that the only way labor can prosper is to let capital achieve high returns, notwithstanding the contradiction that high returns on capital must come from low wages.

    New legislation and laws, executive orders, federal government rule-making, federal agency decisions, and think-tank propaganda, etc, subsequently followed the new political landscape, assisting the implementation of new corporate policies and practices emerging from corporate headquarters rather than from the shop floor. Economists and analysts who challenged this voodoo theory were largely shut out of the media.

    Workers by the million were persuaded to abandon their institutional collective defender to fend for themselves individually in the name of freedom. It was a freedom to see their job security eroded and wages and benefits fall with no recourse.

    Note
    1. Das Kapital, Volume One, Part I: Commodities and Money, Chapter One: Commodities, Section I.

    Next: PART 2: Global war on labor

    Henry C K Liu is chairman of a New York-based private investment group. His website is at http://www.henryckliu.com.

    Copyright 2007, Henry C K Liu

    FT.com - Columnists - Martin Wolf - Why Britain has to curb finance By Martin Wolf

    May 21 2009 | ft.com

    The UK has a strategic nightmare: it has a strong comparative advantage in the world's most irresponsible industry. So now, in the wake of the biggest financial crisis since the 1930s, the UK must ask itself a painful question: how should the country manage the cuckoo sitting in its nest?

    The question is inescapable. London is one of the world's two most important centres of global finance. Its regulators have, as a result, an influence on the world economy out of proportion to the country's size. In the years leading up to the crisis, that influence was surely malign: the "light touch" approach led the way in a regulatory race to the bottom.

    EDITOR'S CHOICE

    Martin Wolf: This crisis is a moment, but may not be a defining one - May-19 Martin Wolf: Why Obama's conservatism may not prove good enough - May-12 Economists' forum - Oct-01 Martin Wolf: Tackling Britain's fiscal debacle - May-07

    The fiscal costs of this crisis will be comparable to those of a big war. Thursday's threatened downgrade by Standard & Poor's is a reminder of those costs. Loss of jobs and incomes will also scar the lives of hundreds of millions of people around the world.

    All this occurred, in part, because institutions replete with highly qualified and highly rewarded people were unable or unwilling to manage risk responsibly. The UK, as a country, the City of London and the broader financial industry bear much responsibility for this calamity. This is a time for self-examination.

    A recent report on the future of UK international financial services, produced by a group co-chaired by Sir Win Bischoff, former chairman of Citigroup, and Alistair Darling, chancellor of the exchequer, fails to provide such self-examination. This is partly because the committee consisted of the industry's "great and good". It is far more because Mr Darling had already decided that "financial services are critical to the UK's future". Thus, the report's remit was "to examine the competitiveness of financial services globally and to develop a framework on which to base policy and initiatives to keep UK financial services competitive".

    If you ask the wrong question, you will get the wrong answer. The right question is, instead, this: what framework is needed to ensure that the operation of the financial sector is compatible with the long-run health of the UK and world economies?

    Quite simply, the sector imposes massive negative externalities (or costs) on bystanders. Thus, the recommendation "that the financial sector be allowed to recalibrate its activities according to the sentiments and demands of the market" is wrong. A market works well if, and only if, decision-makers confront the consequences of their decisions. This is not – and probably cannot be – the case in finance: certainly, people now sit on fortunes earned in activities that have led to unprecedented rescues and the worst recession since the 1930s. Given this, the industry has become too big. If implicit and explicit guarantees and externalities, including volatility, were fully charged, the sector would surely shrink.

    So how should one manage a sector that produces such "bads"? The answer is: in the same way as any polluting activity. One taxes it. At this point, the authors of the report will surely ask: "How can you suggest taxing a sector so vital to the UK economy?" The answer is: easily. Financial services generate only 8 per cent of gross domestic product. They are more important for taxation and the balance of payments. But this tax revenue turns out to be perilously volatile. True, in 2007, the last year before the crisis, the UK ran a trade surplus of £37bn in financial services, partially offsetting an £89bn deficit in goods. But smaller net earnings from financial services would have generated a lower real exchange rate and more earnings elsewhere. Given the costs imposed by the financial sector, a more diversified economy would have been healthier. Such sacrilegious ideas are, of course, not to be found in the Bischoff report.

    How then should the UK approach policy towards the sector? I would suggest the following guiding ideas.

    First, the UK needs to make global regulation work. It should discourage regulatory arbitrage even if it expects to gain in the short run.

    Second, it must, in particular, help ensure that owners and managers of financial institutions internalise most of the costs of their actions.

    Third, it must reject egregious special pleading from the industry. The sector argues that moving derivatives trading on to exchanges might damage innovation. So what? Maximising innovation is a crazy objective. As in pharmaceuticals, a trade-off exists between innovation and safety. If institutions threaten to take trading activities offshore, banking licences should be revoked.

    Fourth, while trying to create a stable and favourable environment for business activities, the UK should try to diversify the economy away from finance, not reinforce its overly strong comparative advantage within it.

    Fifth, UK authorities need to ensure that the risks run by institutions they guarantee fall within the financial and regulatory capacity of the British state. They should not let the country be exposed to the risks created by inadequately supported and under-regulated foreign institutions. At the very least, they should not undermine other governments' efforts to regulate their own institutions.

    The "old normal" was simply unsustainable. The "new normal" must be very different. It is far from clear that the industry and government recognise this grim truth.

    [Oct 26, 2005] Criminal Capitalism and Quixotic Devotee by Girish Mishra

    October 26, 2005 | Printer Friendly Version

    Raymond W. Baker knows of the working of world capitalist system in all its intricacies to the minutest details as he worked for almost four decades in Africa and South America as a prominent businessman. Later, he was associated with two prominent think-tanks of America, including the Brookings Institution.

    The thesis, he has propounded in this book, is two fold: capitalism is rotten and badly stinking, yet it needs to be reformed, as there is no alternative to it. Baker, in his experience over a period of more than 40 years in more than 60 countries, has seen "the free–market system operate illicitly and corruptly" and its impact "on the lives of disadvantaged people on all six inhabited continents". He very candidly admits that "The basic structure of our global economic system has fundamental flaws, and the accompanying risks are beginning to be evident to wealthy and impoverished alike."

    When Baker, after finishing Harvard Business School and teaching a course in management at the University of New Hampshire, joined the business world in Nigeria, he was surprised to find that a lot of people invested their money in one place but reaped huge profits somewhere else through a complicated mechanism based on over- and under-invoicing and transfer pricing among other things. To quote Baker, "It took me two or three years to realize that most foreign-owned companies were doing largely the same thing. And then it took another couple of years to learn that most wealthy Africans involved in foreign trade were illegally moving money abroad by the same means. As the decades rolled on and my activities spread to dozens of countries across the planet, I observed that countless forms of financial chicanery are prevalent in international business. Like an iceberg, the little that is visible is supported by vastly more hidden beneath the surface."

    Baker has found the reputation of free-market system, even in the West, in the mud as it abounds in all kinds of frauds, scandals and illegalities. "An assortment of frauds, thefts, corrupt practices, accounting irregularities, earning restatements, asset write downs, tax shenanigans, conflicts of interest, and other charges, probes, malpractices, and allegations have corroded the reputations of dozens of companies and sapped the net worth of untold numbers of shareholders and retirees. The list of financial institutions tarnished in the press reads like what should otherwise be the Who's Who of propriety: Citigroup, J. P. Morgan Chase, Bank of America, Bankers Trust, Bank of New York and some 55 more on the roster I maintain. The corporate rap sheet, ranging from spectacular failures to merely disgraced executives, includes Enron, WorldCom, Global Crossing, Halliburton, and nearly 100 more on my list. All Big 5 accounting firms have been tarred and feathered. The number of law firms taking heat is too long to recount."

    It has been claimed time and again that uninterrupted operation of market forces globally will do away with all kinds of corruption and criminal activities, which are supposed to arise from government interventions and regulations and the emergence of monopolies. What has happened in practice is quite the opposite. Baker has come out with a damning indictment: "Since the end of the Cold War, the opening years of the globalizing era have produced an explosion in the volume of illegitimate commercial and financial transactions. North American and European banking and investment institutions have been flooded with laundered and ill-gotten gains. Totaling trillions of dollars, most of these sums generated through secret arrangements between cooperating but distant private-sector entities. Lagging legal codes have proven inadequate to deal with the situation. Much of the subject is a taboo in business and government circles, yet this torrent of stolen, disguised, and hidden resources poses a major risk to state stability, corporate security, democracy, and free enterprise across the planet."

    The major portion of the book is devoted to a discussion of dirty money, its various components, the mechanism by which it is generated, how the tax havens and Western financial institutions facilitate its generation and its laundering, and the way the U. S. and other governments, notwithstanding all their protestations abate it. 'Dirty Money' has been defined as "money that is illegally earned, illegally transferred, or illegally utilized. If it breaks laws in its origin, movement, or use, then it properly merits the label."

    There are three main components of dirty money, namely, criminal, corrupt, and commercial. The criminal component comprises wide-ranging evil activities such as racketeering, smuggling of men as well as material goods, all kinds of fraud, counterfeiting of goods and currency notes, embezzlement, fraud, forgery, prostitution, piracy of all types and so on. It needs to be noted that most countries have banned proceeds of drug trafficking, bank fraud, and terrorism. The corrupt component has in its fold the yield of bribery and theft by foreign government officials. The commercial component is generally the result of tax-evasion and it does not find any place in official records.

    According to Baker, "What is most striking is that all three forms of dirty money –criminal, corrupt, and commercial–utilize basically the same subterfuges to roll through international channels: false documentation, dummy, corporations, shell banks, tax havens, offshore secrecy jurisdictions, mispricing, collusion, kickbacks, numbered accounts, wire transfers that disguise transactions, and more. Whether it's moving drug money or tax-evading money, whether it's a thug or tyrant or terrorist or corporate titan, all use the same bag of tricks. And the truth is, western business and banking sectors have developed and promoted the mechanisms for other countries for more than a century."

    There are many ways to get rich while the government and the society do not know where the money comes from. One of them is under- and over-invoicing. This is a very old tactics resorted to in international trade, real estate deals, purchase of services, etc. that form part of international business transactions. To give an example, an Indian businessman may export textiles worth $10m but show in the invoice just $8m and understanding is reached before hand with the importer that he would remit to the exporter $8m and deposit the rest in some Swiss bank account or somewhere else after deducting his commission or service charges. Similarly, some Indian businessman imports machinery and equipment worth $8m but bills, as per the secret understanding, for $10m. The Reserve Bank of India releases on the basis of the invoice a sum of $10m. The exporter takes $8m and the rest of the amount is deposited in the name of the Indian businessman or his nominee, after deducting the service charges. Thus India is defrauded to the extent of $4m in these two transactions taken together and dirty or black money to the tune of $4m is generated, which multiplies if ploughed back in business activities. So far as India is concerned, its government is deprived of foreign exchange to the tune of $4m that could have been used for developmental purposes.

    Baker has found that not only goods but services also can be mispriced or subject to over- and under-invoicing. "Insurance is a regular candidate with premiums marked up to provide offshore kickbacks. Foreign advertising is another popular vehicle. Consulting contracts and advisory services are easy to load with kickbacks. Technical assistance agreements offer a regular outflow of money that can be shifted into offshore bank accounts. Similarly, royalties, patents, and licenses have become a recent favorite among skilled money shifters."

    The U.S. and other Western governments claim that they have legally forbidden their companies to indulge in bribery in foreign lands, but this stipulation is very easily circumvented. Baker has found that the usual trick is to allow 20 per cent or so in place of usual 10 per cent commission to the agents to procure the business. Agents understand the purpose of this unusually high rate of commission and they leave no stone unturned to influence and bribe the decision-makers. They offer money and various kinds of other inducements on one pretext or the other. As is widely known, one American company, Enron, now defunct, gave money to certain people in India in the name of promoting education! Baker mentions a widely used trick: "An expatriate lawyer in the MiddleEast does a thriving business representing arms manufacturers. He sets up billion-dollar weapons deals under two contracts, one for the main equipment and a second for support services such as training, maintenance, and software updates. The first contract with the government of the purchasing country is priced properly. The second contract is channeled through a joint-venture company in a Caribbean tax haven, owned by the arms manufacturer and by designated friends of the government officials in the buying country. While doing no work, these nominee partners share in the venture's deliberately bloated revenues, passing the funds along to their principals, the officials who are the real but silent partners." Even a reputed company like IBM entered into such an arrangement with an Argentine firm. Baker has the details of this shady deal.

    The Indian government's scheme of offering subsidy to exporters has led to inflating the items entering export trade to corner as much subsidy as possible. "Lots of exporters continue to get rich off their government's programs, so be alert to this money-making opportunity." This is one of the findings of Baker so far as India is concerned. It speaks volumes about the honesty of Indian businessmen and the media they control.

    Another very useful trick is transfer pricing by multinational corporations who resort to "the use of trade to shift money at will between parents, subsidiaries, and affiliates operating in dozens of countries. For many multinational corporations, exaggerated transfer pricing is standard procedure, a major part of global strategies to minimize taxes and maximize profits." Further, "Intracompany trade across borders represents about 50 to 60 per cent of all cross border trade. I have never known a multinational, multibillion-dollar, multiproduct corporation that did not use fictitious transfer pricing in some part of its business to shift money between some of its entities."

    Consulting contracts claims arising out of imaginary damages, warranty payments, countertrade deals, etc. are some of the other effective tricks to generate dirty money and fleece developing countries.

    Another frequently used device is the formation of dummy or bogus companies. It is very simple, a reinvoicing company is formed that buys, changes prices, issues a new commercial invoice, and resells. This dummy company requires only a computer, a letterhead, and a bank account to come into play. Baker has given a number of concrete examples to illustrate the operation of dummy companies.

    Dummy companies play a major role in disguising the source of dirty money and then help launder it. Baker has named a number of "delightful places where you can situate and purchase your secret companies." In all, they come to "63 jurisdictions providing varying degrees of incorporation concealment and protection from probing eyes." There are printed manuals that guide all the way. These dummy companies have a number of variations such as trusts, foundations, and so on. Offshore dummy companies are known as international business corporations (IBCs) or personal investment corporations (PICs). If we believe Baker, then "the United States is encouraging havens and secrecy jurisdictions to keep up with the owners of IBCs and PICs and is trying to insist on mutual legal assistance and cooperation in specific tax and criminal matters." If you are interested in details, then Baker has them. In addition to all this, one can very easily fake the entire transactions without stirring out of your home!

    What Baker says is beyond any dispute. To quote: "Use of instruments in the dirty-money user kit carries a high price. The price is damage to the capitalist system. The price is bolstering international crime and terrorism. The price is deprivation for billions of people. The price is heightened risk to the shared security of a globalizing world."

    Raymond W. Baker's study presents in great details how "corruption industry" has flourished over the years in Nigeria, Indonesia and Pakistan. It has led to worsening of poverty, limiting government tax revenues, curtailed expenditures on health and education, reduced economic growth, increased indebtedness and discouraged investments. The estimates of public funds looted by some of the corrupt rulers are mind- boggling. Suharto embezzled $15 to $35 billion while Marcos and Mobutu pilfered $5 to $10 billion and $$5 billion respectively. Sani Abacha of Nigeria stole $2 to $5 billion. Pinochet of Chile, who was once hailed as a great saviour of humanity from communism by the USA ate up public funds with the active help and connivance of the Washington-based Riggs Bank about which, to quote Baker, "groveled before some of the dirtiest money on Earth."

    "Prestigious" banks and financial institutions of the world actively helped all these plunderers of public funds. Take, for example, the case of Sani Abacha of Nigeria. His "plunder was facilitated by some 100 banks all over the world-in the United States, England, the Channel Islands, France, Switzerland, Germany, Luxembourg, Liechtenstein, Austria, Dubai, Singapore, Hong Kong, Austria, Brazil, and elsewhere, with services allegedly performed by such institutions as Citibank, Barclays, Standard Chartered, HSBC, NatWest (now part of the Royal Bank of Scotland), ANZ Grindlays Bank, BNP Paribas, Crédit Agricole Indosuez, Credit Suisse (including Bank Hofmann and Bank Leu), Banque Baring Brothers, Banque du Gothard, Union Bancaire Privée, M. M. Warburg, Banque Edouard Constant, Deutsche Morgan Grenfell, J. Henry Schroder Bank, Picett & Cie, S. G. Ruegg Bank, Commerzbank, Bank of India, and many more. With a fortune estimated at $3 billion to $5 billion, a feeding frenzy arose to receive, shelter, and manage Abacha's wealth."

    Criminal component of dirty money has its source largely in drug trafficking, mostly from Afghanistan, Colombia, Peru, etc. and in thuggery and racketeering in which terrorists as well as Mafia have a key role. So far as commercial component is concerned, one has to look at the modus operandi of multinational corporations and the state of affairs prevailing in the Soviet Union and the East European countries after the collapse of socialist regimes. Baker has the details in his book.

    Baker, in the context of what happened on 9/11, asks: "Was it just religious extremism that brought on the terrorists, power disparities, income imbalances, and social disaffections evident in their motivations?"

    Baker thinks that, in spite of all its rottenness, capitalism has no alternative and it can be reformed and rejuvenated to take the humanity forward. It is difficult to accept this proposition because it is nothing but pure and simple quixotic.

    Before we conclude, let us draw the attention of our readers to a write-up in Guardian (October 25, 2005), which says that the Mayor of London is ready to welcome the robber barons fleeing from Russia after plundering it mercilessly. Obviously, capitalism feels at ease with criminals of all kind.

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    [Mar 17, 2019] As Hemingway replied to Scott Fitzgerald assertion The rich are different than you and me : yes, they have more money. Published on Dec 31, 2015 | nakedcapitalism.com

    [Nov 27, 2018] The political fraud of Alexandria Ocasio-Cortez's "Green New Deal" Published on Nov 27, 2018 | www.wsws.org

    [Nov 23, 2018] Sitting on corruption hill Published on Nov 23, 2018 | www.zerohedge.com

    [Nov 03, 2018] Kunstler The Midterm Endgame Democrats' Perpetual Hysteria Published on Nov 03, 2018 | www.zerohedge.com

    [Oct 02, 2018] I m puzzled why CIA is so against Kavanaugh? Published on Oct 02, 2018 | www.unz.com

    [May 03, 2018] Alert The Clintonian empire is still here and tries to steal the popular vote throug Published on May 03, 2018 | failedevolution.blogspot.gr

    [Apr 21, 2018] On the Criminal Referral of Comey, Clinton et al by Ray McGovern Published on Apr 21, 2018 | www.unz.com

    [Apr 01, 2018] Big American Money, Not Russia, Put Trump in the White House: Reflections on a Recent Report by Paul Street Published on Mar 30, 2018 | www.counterpunch.org

    [Jan 20, 2018] What Is The Democratic Party ? by Lambert Strether Published on Jan 15, 2018 | www.nakedcapitalism.com

    [Dec 12, 2017] Thoughts on Neoconservatism and Neoliberalism by Hugh Published on Aug 19, 2012 | Corrente

    [Sep 11, 2017] Around 1970 corporate managers and professionals realized that they shared the same education, background and interests with capital owners and realigned themselves, abandoning working class and a large part of lower middle class (small business owners) Published on Nov 14, 2016 | crookedtimber.org

    [Sep 11, 2017] Around 1970 corporate managers and professionals realized that they shared the same education, background and interests with capital owners and realigned themselves, abandoning working class and a large part of lower middle class (small business owners) Published on Nov 14, 2016 | crookedtimber.org

    [Jul 13, 2017] Progressive Democrats Resist and Submit, Retreat and Surrender by James Petras Published on Jul 10, 2017 | www.unz.com

    Sites



    Etc

    Society

    Groupthink : Two Party System as Polyarchy : Corruption of Regulators : Bureaucracies : Understanding Micromanagers and Control Freaks : Toxic Managers :   Harvard Mafia : Diplomatic Communication : Surviving a Bad Performance Review : Insufficient Retirement Funds as Immanent Problem of Neoliberal Regime : PseudoScience : Who Rules America : Neoliberalism  : The Iron Law of Oligarchy : Libertarian Philosophy

    Quotes

    War and Peace : Skeptical Finance : John Kenneth Galbraith :Talleyrand : Oscar Wilde : Otto Von Bismarck : Keynes : George Carlin : Skeptics : Propaganda  : SE quotes : Language Design and Programming Quotes : Random IT-related quotesSomerset Maugham : Marcus Aurelius : Kurt Vonnegut : Eric Hoffer : Winston Churchill : Napoleon Bonaparte : Ambrose BierceBernard Shaw : Mark Twain Quotes

    Bulletin:

    Vol 25, No.12 (December, 2013) Rational Fools vs. Efficient Crooks The efficient markets hypothesis : Political Skeptic Bulletin, 2013 : Unemployment Bulletin, 2010 :  Vol 23, No.10 (October, 2011) An observation about corporate security departments : Slightly Skeptical Euromaydan Chronicles, June 2014 : Greenspan legacy bulletin, 2008 : Vol 25, No.10 (October, 2013) Cryptolocker Trojan (Win32/Crilock.A) : Vol 25, No.08 (August, 2013) Cloud providers as intelligence collection hubs : Financial Humor Bulletin, 2010 : Inequality Bulletin, 2009 : Financial Humor Bulletin, 2008 : Copyleft Problems Bulletin, 2004 : Financial Humor Bulletin, 2011 : Energy Bulletin, 2010 : Malware Protection Bulletin, 2010 : Vol 26, No.1 (January, 2013) Object-Oriented Cult : Political Skeptic Bulletin, 2011 : Vol 23, No.11 (November, 2011) Softpanorama classification of sysadmin horror stories : Vol 25, No.05 (May, 2013) Corporate bullshit as a communication method  : Vol 25, No.06 (June, 2013) A Note on the Relationship of Brooks Law and Conway Law

    History:

    Fifty glorious years (1950-2000): the triumph of the US computer engineering : Donald Knuth : TAoCP and its Influence of Computer Science : Richard Stallman : Linus Torvalds  : Larry Wall  : John K. Ousterhout : CTSS : Multix OS Unix History : Unix shell history : VI editor : History of pipes concept : Solaris : MS DOSProgramming Languages History : PL/1 : Simula 67 : C : History of GCC developmentScripting Languages : Perl history   : OS History : Mail : DNS : SSH : CPU Instruction Sets : SPARC systems 1987-2006 : Norton Commander : Norton Utilities : Norton Ghost : Frontpage history : Malware Defense History : GNU Screen : OSS early history

    Classic books:

    The Peter Principle : Parkinson Law : 1984 : The Mythical Man-MonthHow to Solve It by George Polya : The Art of Computer Programming : The Elements of Programming Style : The Unix Hater’s Handbook : The Jargon file : The True Believer : Programming Pearls : The Good Soldier Svejk : The Power Elite

    Most popular humor pages:

    Manifest of the Softpanorama IT Slacker Society : Ten Commandments of the IT Slackers Society : Computer Humor Collection : BSD Logo Story : The Cuckoo's Egg : IT Slang : C++ Humor : ARE YOU A BBS ADDICT? : The Perl Purity Test : Object oriented programmers of all nations : Financial Humor : Financial Humor Bulletin, 2008 : Financial Humor Bulletin, 2010 : The Most Comprehensive Collection of Editor-related Humor : Programming Language Humor : Goldman Sachs related humor : Greenspan humor : C Humor : Scripting Humor : Real Programmers Humor : Web Humor : GPL-related Humor : OFM Humor : Politically Incorrect Humor : IDS Humor : "Linux Sucks" Humor : Russian Musical Humor : Best Russian Programmer Humor : Microsoft plans to buy Catholic Church : Richard Stallman Related Humor : Admin Humor : Perl-related Humor : Linus Torvalds Related humor : PseudoScience Related Humor : Networking Humor : Shell Humor : Financial Humor Bulletin, 2011 : Financial Humor Bulletin, 2012 : Financial Humor Bulletin, 2013 : Java Humor : Software Engineering Humor : Sun Solaris Related Humor : Education Humor : IBM Humor : Assembler-related Humor : VIM Humor : Computer Viruses Humor : Bright tomorrow is rescheduled to a day after tomorrow : Classic Computer Humor

    The Last but not Least Technology is dominated by two types of people: those who understand what they do not manage and those who manage what they do not understand ~Archibald Putt. Ph.D


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    Last modified: January 29, 2021