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Casino Capitalism: Neoliberalism in Western countries

"When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done" ~ John Maynard Keynes

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Financialization is a process whereby financial markets, financial institutions, and financial elites gain greater influence over economic policy and economic outcomes. Financialization transforms the functioning of economic systems at both the macro and micro levels.

Its principal impacts are to (1) elevate the significance of the financial sector relative to the real sector, (2) transfer income from the real sector to the financial sector, and (3) increase income inequality and contribute to wage stagnation. Additionally, there are reasons to believe that financialization may put the economy at risk of debt deflation and prolonged recession.

Financialization operates through three different conduits: changes in the structure and operation of financial markets, changes in the behavior of nonfinancial corporations, and changes in economic policy.

Countering financialization calls for a multifaceted agenda that (1) restores policy control over financial markets, (2) challenges the neoliberal economic policy paradigm encouraged by financialization, (3) makes corporations responsive to interests of stakeholders other than just financial markets, and (4) reforms the political process so as to diminish the influence of corporations and wealthy elites.

Thomas Palley, See http://www.levyinstitute.org/pubs/wp_525.pdf

Speculation and gambling were always a part of Wall Street but since the 1930’s they were just a side-show, now they are the show.

Comment to Matt Taibbi article Fannie, Freddie, and the New Red and Blue t


Introduction

“The sense of responsibility in the financial community
for the community as a whole is not small. It is nearly nil.”

-- John Kenneth Galbraith, The Great Crash of 1929

The term Casino Capitalism generally is symonim of neoliberalism (also called economic liberalism), but it also point out to a specific phase of neoliberal transformation of capitalism. Politically it was slow motion corporate coup d'état, which started in 70th and is now accomplished in the USA and other Western countries which buries social-democratic (New Deal style) model of capitalism. 

It hypertrophied police functions of state (in the form of national-security state)  while completely avoiding economic sphere in ways other then enforcement of laws (with a notable exclusion from this top 1% -- "Masters of the Universe"). Like bolshevism it uses the state for the enforcement of the social system.  On top level this is crony capitalism for major corporation. On low level of medium and small business owners it presupposed a deregulated economy (in a sense of the "law of jungle" as a business environment).

Casino capitalism presupposes strong militarized state, suppressing all the attempts to challenge the new "nomenklatura" (much like was the case in the USSR).  It is quite different from traditional liberalism:

“Liberalism” can refer to political, economic, or even religious ideas. In the U.S. political liberalism has been a strategy to prevent social conflict. It is presented to poor and working people as progressive compared to conservative or Right wing. Economic liberalism is different. Conservative politicians who say they hate “liberals” — meaning the political type — have no real problem with economic liberalism, including neoliberalism.

In other words this is neoliberal model of corporatism during the period of "cheap hydrocarbons".  The period that is probably near the end and which by some estimate can last only another 50 years or so (less than 100 years).  The major crisis of casino capitalism in 2008 was connected both with financial excesses (caused by moving to semi-criminal ways of extracting return on capital, typical for casino capitalism),  but also with the rise of the price of oil and decrease of  Energy returned on energy invested (EROEI)In this sense the last low oil price period which started in late 2014 and ended in spring 2018 can be viewed as the "last hurrah" of the casino capitalism.

In understanding neoliberal transformation of the society since early 80th it is important to understanding of the key role of financialization in this process. When major services are privatized (education, healthcare, pension plans) financial institution insert themselves as intermediaries in this arrangement and make it the main source of their profits.  Also contrary to neoliberal propaganda this process is aided and abetted by state. State is used by neoliberalism as a tool of enforcing market relations even where they are not useless or even harmful (education). All this talk about irresolvable controversy between market and state is for gullible fools. In reality, being Trotskyism for rich, neoliberalism uses power of the state to enforce market relations  by force on reluctant population even in areas where this can do no good. That make really it close to Soviet social experiment, which lasted from 1917 to 1991 or almost 75 years. As Marx noted "History repeats itself, first as tragedy, second as farce."

A very good discussion of the role of Financialisation in entrenchment of neoliberalism in modern societies can be found in the book by Costas Lapavitsas. Some highlights are provided in his Guardian article Finance's hold on our everyday life must be broken

This extraordinary public largesse towards private banks was matched by austerity and wage reductions for workers and households. As for restructuring finance, nothing fundamental has taken place. The behemoths that continue to dominate the global financial system operate in the knowledge that they enjoy an unspoken public guarantee. The unpalatable reality is that financialisation will persist, despite its costs for society.

Financialisation represents a historic and deep-seated transformation of mature capitalism. Big businesses have become "financialised" as they have ample profits to finance investment, rely less on banks for loans and play financial games with available funds. Big banks, in turn, have become more distant from big businesses, turning to profits from trading in open financial markets and from lending to households. Households have become "financialised" too, as public provision in housing, education, health, pensions and other vital areas has been partly replaced by private provision, access to which is mediated by the financial system. Not surprisingly, households have accumulated a tremendous volume of financial assets and liabilities over the past four decades.

The penetration of finance into the everyday life of households has not only created a range of dependencies on financial services, but also changed the outlook, mentality and even morality of daily life. Financial calculation evaluates everything in pennies and pounds, transforming the most basic goods – above all, housing – into "investments". Its logic has affected even the young, who have traditionally been idealistic and scornful of pecuniary calculation. Fertile ground has been created for neoliberal ideology to preach the putative merits of the market.

Financialisation has also created new forms of profit associated with financial markets and transactions. Financial profit can be made out of any income, or any sum of money that comes into contact with the financial sphere. Households, for example, generate profits for finance as debtors (mostly by paying interest on mortgages) but also as creditors (mostly by paying fees and charges on pension funds and insurance). Finance is not particular about how and where it makes its profits, and certainly does not limit itself to the sphere of production. It ranges far and wide, transforming every aspect of social life into a profit-making opportunity.

The traditional image of the person earning financial profits is the "rentier", the individual who invests funds in secure financial assets. In the contemporary financialised universe, however, those who earn vast returns are very different. They are often located within a financial institution, presumably work to provide financial services, and receive vast sums in the form of wages, or more often bonuses. Modern financial elites are prominent at the top of the income distribution, set trends in conspicuous consumption, shape the expensive end of the housing market, and transform the core of urban centres according to their own tastes.

Financialised capitalism is, thus, a deeply unequal system, prone to bubbles and crises – none greater than that of 2007-09. What can be done about it? The most important point in this respect is that financialisation does not represent an advance for humanity, and very little of it ought to be preserved. Financial markets are, for instance, able to mobilise advanced technology employing some of the best-trained physicists in the world to rebalance prices across the globe in milliseconds. This "progress" allows financiers to earn vast profits; but where is the commensurate benefit to society from committing such expensive resources to these tasks?

The term "casino capitalism" was coined by Susan Strange who used it as a title of her book Casino Capitalism published in 1986. She was one of the first who realized that

  1. "The roots of the world's economic disorder are monetary and financial";
  2. "The disorder has not come about by accident, but has in fact been nurtured and encouraged by a series of government decisions." (p. 60). In other words its was a counter-revolution of the part of ruling elite (financial oligarchy) which lost its influence in 30th (dismantling New Deal from above in the USA (Reaganomics) or Thatcherism in the GB).

According to Susan Strange transformation of industrial capitalism into neoliberal capitalism ("casino capitalism") involved five trends. All of them increased the systemic instability of the system and the level of political corruption:

  1. Innovations in the way in which financial markets work due to introduction of computers;
  2. The sheer size of markets; (with the introduction of 401K the size of stock market multiplied, etc)
  3. Commercial banks turned into investment banks;
  4. The emergence of Asian nations as large players;
  5. The shift to self-regulation by banks (pp.9-10).

Now it is pretty much established fact that the conversion from "industrial capitalism" to neoliberal, completely financialialized "casino capitalism" is the natural logic of development of capitalism. In early and incomplete matter this trend was noticed at early 1990th by many thinkers. This is just the second iteration of the same trend which was interrupted by the Great Depression and subsequent WWII. So, in a way, replacement of industrial capitalism with financial capitalism in a natural tendency within the capitalism itself and corruption was contributing, but not decisive factor.  The same is true about globalization, especially about globalization of financial flows, typical for casino capitalism, which is a form of colonialism (neocolonialism).

Also this conversion did not happen due to lack of oversight or as a folly. It was a couscous choice made by the US and GB elite, both of which faced deterioration of rates of return on capital. Also unlike "industrial capitalism" which was more-or-less stable system, able to outcompete the neo-theocratic system of the USSR, the financial capitalism is unstable in the same sense as radioactive elements are unstable.  And this instability tend to increase with time. So there is probably natural half-life period for neoliberalism as a social system. It might be already reached in 2008.  In we assume that global victory of neoliberalism happened in 1990. It is just 18 years.  If we think that it happened in late 60th, then it is closer to 50 years.

The global crisis of neoliberal capitalism which started from bursting the USA subprime housing bubble in 2008 undermined ideological legitimacy of its central claim that "free markets" lead to faster and more uniform economic development of all countries. While the peak of its "ideological" power might be over (much like the peak of attractiveness of "command socialism" was over after WWII), it will exist in a zombie state for a long time due to economic and military power of the USA and G7.  And as we know from Hollywood films, zombies can be especially bloodthirsty. It probably will remain the dominant force for at least the next two decades pursuing the same policy of "forceful" opening of energy rich  and resource countries for western multinationals intact using color revolutions and local wars.  But as Napoleon quipped "You can do anything with bayonets, you just can't sit on them".

Conversion to neoliberal capitalism was a reaction on stagnation of industrial production and as such it was nurtured and encouraged by a series of government decisions for the last 50 years. Stagnation of industrial production made expansion of financial sector of paramount importance for the ruling elite and by extension for Congress which represents this elite. House vote 377:4 for Commodity Futures Modernization Act of 2000 is pretty telling in this respect.

There were also at least two important parallel developments.

Most respectable authors like Henry Giroux in his article in Counterpunch generally consider the term "casino capitalism" to be an equivalent to the term Neoliberalism. Here is a relevant quote from Henry Giroux's Authoritarian Politics in the Age of Casino Capitalism :

There is more at work here than simply a ramped up version of social Darwinism with its savagely cruel ethic of “reward the rich, penalize the poor, [and] let everyone fend for themselves,” [ii] there is also a full scale attack on the social contract, the welfare state, economic equality, and any viable vestige of moral and social responsibility. The Romney-Ryan appropriation of Ayn Rand’s ode to selfishness and self-interest is of particular importance because it offers a glimpse of a ruthless form of extreme capitalism in which the poor are considered “moochers,” viewed with contempt, and singled out to be punished. But this theocratic economic fundamentalist ideology does more. It destroys any viable notion of the and civic virtue in which the social contract and common good provide the basis for creating meaningful social bonds and instilling in citizens a sense of social and civic responsibility. The idea of public service is viewed with disdain just as the work of individuals, social groups, and institutions that benefit the citizenry at large are held in contempt.

As George Lakoff and Glenn W. Smith point out, casino capitalism creates a culture of cruelty: “its horrific effects on individuals-death, illness, suffering, greater poverty, and loss of opportunity, productive lives, and money.”[iii]

But it does more by crushing any viable notion of the common good and public life by destroying “the bonds that hold us together.”[iv] Under casino capitalism, the spaces, institutions, and values that constitute the public are now surrendered to powerful financial forces and viewed simply as another market to be commodified, privatized and surrendered to the demands of capital. With religious and market-driven zealots in charge, politics becomes an extension of war; greed and self-interest trump any concern for the well-being of others; reason is trumped by emotions rooted in absolutist certainty and militaristic aggression; and skepticism and dissent are viewed as the work of Satan.

If the Republican candidacy race of 2012 is any indication, then political discourse in the United States has not only moved to the right—it has been introducing totalitarian values and ideals into the mainstream of public life. Religious fanaticism, consumer culture, and the warfare state work in tandem with neoliberal economic forces to encourage privatization, corporate tax breaks, growing income and wealth inequality, and the further merging of the financial and military spheres in ways that diminish the authority and power of democratic governance.[v] Neoliberal interests in freeing markets from social constraints, fueling competitiveness, destroying education systems, producing atomized subjects, and loosening individuals from any sense of social responsibility prepare the populace for a slow embrace of social Darwinism, state terrorism, and the mentality of war — not least of all by destroying communal bonds, dehumanizing the other, and pitting individuals against the communities they inhabit.

Totalitarian temptations now saturate the media and larger culture in the language of austerity as political and economic orthodoxy. What we are witnessing in the United States is the normalization of a politics that exterminates not only the welfare state, and the truth, but all those others who bear the sins of the Enlightenment — that is, those who refuse a life free from doubt. Reason and freedom have become enemies not merely to be mocked, but to be destroyed. And this is a war whose totalitarian tendencies are evident in the assault on science, immigrants, women, the elderly, the poor, people of color, and youth.

What too often goes unsaid, particularly with the media’s focus on inflammatory rhetoric, is that those who dominate politics and policymaking, whether Democrats or Republicans, do so largely because of their disproportionate control of the nation’s income and wealth. Increasingly, it appears these political elite choose to act in ways that sustain their dominance through the systemic reproduction of an iniquitous social order. In other words, big money and corporate power rule while electoral politics are rigged. The secrecy of the voting booth becomes the ultimate expression of democracy, reducing politics to an individualized purchase—a crude form of economic action. Any form of politics willing to invest in such ritualistic pageantry only adds to the current dysfunctional nature of our social order, while reinforcing a profound failure of political imagination. The issue should no longer be how to work within the current electoral system, but how to dismantle it and construct a new political landscape that is capable of making a claim on equity, justice, and democracy for all of its inhabitants. Obama’s once inspiring call for hope has degenerated into a flight from responsibility.

The Obama administration has worked to extend the policies of the George W. Bush administration by legitimating a range of foreign and domestic policies that have shredded civil liberties, expanded the permanent warfare state, and increased the domestic reach of the punitive surveillance state. And if Romney and his ideological cohorts, now viewed as the most extremists faction of the Republican Party, come to power, surely the existing totalitarian and anti-democratic tendencies at work in the United States will be dangerously intensified.

History

Alternatively, we could have spent more time studying the work of Hyman Minsky. We could also have considered the possibility that, just as Keynes’s ideas were tested to destruction in the 1950s, 1960s and 1970s, Milton Friedman’s ideas might suffer a similar fate in the 1980s, 1990s and 2000s. All gods fail, if one believes too much. Keynes said, of course, that "practical men … are usually the slaves of some defunct economist". So, of course, are economists, even if the defunct economists are sometimes still alive.

Martin Wolf

 


 

 

Casino capitalism  is a nickname for nailibelism. Probably more properly nickname would be  financial corporatism. While the key idea of corporatism: that political actors are not individual people, but some associations and first of all corporations (which are officially considered to be "persons" and have rights as well as trade unions and some other associations) remains intact, financial corporatism is different from classic corporatism in several major ways:

Historically corporatism in various modifications became dominant social system after WWII and defeated "command socialism" as was implemented in the USSR. Here is an instructive review of corporatism history (The Economic System of Corporatism):

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 radical solution of the abolition of private property. The result was called Corporatism. The name had nothing to do with the notion of a business corporation except that both words are derived from the Latin word for body, corpus.

The basic idea of corporatism is that the society and economy of a country should be organized into major interest groups (sometimes called corporations) and representatives of those interest groups settle any problems through negotiation and joint agreement. In contrast to a market economy which operates through competition a corporate economic works through collective bargaining. The American president Lyndon Johnson had a favorite phrase that reflected the spirit of corporatism. He would gather the parties to some dispute and say, "Let us reason together."

Under corporatism the labor force and management in an industry belong to an industrial organization. The representatives of labor and management settle wage issues through collective negotiation. While this was the theory in practice the corporatist states were largely ruled according to the dictates of the supreme leader.

One early and important theorist of corporatism was Adam Müller, an advisor to Prince Metternich in what is now eastern Germany and Austria. Müller propounded his views as an antidote to the twin dangers of the egalitarianism of the French Revolution and the laissez faire economics of Adam Smith. In Germany and elsewhere there was a distinct aversion among rulers to allow markets to function without direction or control by the state. The general culture heritage of Europe from the medieval era was opposed to individual self-interest and the free operation of markets. Markets and private property were acceptable only as long as social regulation took precedence over such sinful motivations as greed.

Coupled with the anti-market sentiments of the medieval culture there was the notion that the rulers of the state had a vital role in promoting social justice. Thus corporatism was formulated as a system that emphasized the positive role of the state in guaranteeing social justice and suppressing the moral and social chaos of the population pursuing their own individual self-interests. And above all else, as a political economic philosophy corporatism was flexible. It could tolerate private enterprise within limits and justify major projects of the state. Corporatism has sometimes been labeled as a Third Way or a mixed economy, a synthesis of capitalism and socialism, but it is in fact a separate, distinctive political economic system.

Although rulers have probably operated according to the principles of corporatism from time immemorial it was only in the early twentieth century that regimes began to identify themselves as corporatist. The table below gives some of those explicitly corporatist regimes.

Corporatist Regimes of the Early Twentieth Century
System Name Country Period Leader
National Corporatism Italy 1922-1945 Benito Mussolini
Country, Religion, Monarchy Spain 1923-1930 Miguel Primo de Rivera
National Socialism Germany 1933-1945 Adolph Hitler
National Syndicalism Spain 1936-1973 Francisco Franco
New State Portugal 1932-1968 Antonio Salazar
New State Brazil 1933-1945 Getulio Vargas
New Deal United States 1933-1945 Franklin Roosevelt
Third Hellenic Civilization Greece 1936-1941 Ioannis Metaxas
Justice Party Argentina 1943-1955 Juan Peron

In the above table several of the regimes were brutal, totalitarian dictatorships, usually labeled fascist, but not all the regimes that had a corporatist foundation were fascist. In particular, the Roosevelt New Deal despite its many faults could not be described as fascist. But definitely the New Deal was corporatist. The architect for the initial New Deal program was General Hugh Johnson. Johnson had been the administrator of the military mobilization program for the U.S. under Woodrow Wilson during World War I. It was felt that he did a good job of managing the economy during that period and that is why he was given major responsibility for formulating an economic program to deal with the severe problems of the Depression. But between the end of World War I and 1933 Hugh Johnson had become an admirer of Mussolini's National Corporatist system in Italy and he drew upon the Italian experience in formulating the New Deal.

It should be noted that many elements of the early New Deal were later declared unconstitutional and abandoned, but some elements such as the National Labor Relations Act which promoted unionization of the American labor force are still in effect. One part of the New Deal was the development of the Tennessee River Valley under the public corporation called the Tennessee Valley Authority (TVA). Some of the New Dealer saw TVA as more than a public power enterprise. They hoped to make TVA a model for the creation of regional political units which would replace state governments. Their goal was not realized. The model for TVA was the river development schemes carried out in Spain in the 1920's under the government of Miguel Primo de Rivera. Jose Antonio Primo de Rivera, the son of Miguel Primo de Rivera, was the founder of Franco's National Syndicalism.

Corporatist regime typically promote large governmental projects such as TVA on the basis that they are too large to be funded by private enterprise. In Brazil the Vargas regime created many public enterprises such as in iron and steel production which it felt were needed but private enterprise declined to create. It also created an organized labor movement that came to control those public enterprises and turned them into overstaffed, inefficient drains on the public budget.

Although the above locates the origin of corporatism in 19th century France it roots can be traced much further back in time. Sylvia Ann Hewlett in her book, The Cruel Dilemmas of Development: Twentieth Century Brazil, says,

Corporatism is based on a body of ideas that can be traced through Aristotle, Roman law, medieval social and legal structures, and into contemporary Catholic social philosophy. These ideas are based on the premise that man's nature can only be fulfilled within a political community.
..........
The central core of the corporatist vision is thus not the individual but the political community whose perfection allows the individual members to fulfill themselves and find happiness.
...............
The state in the corporatist tradition is thus clearly interventionist and powerful.

Corporatism is collectivist; it is a different version of collectivism than socialism but it is definitely collectivist. It places some importance on the fact that private property is not nationalized, but the control through regulation is just as real. It is de facto nationalization without being de jure nationalization.

Although Corporatism is not a familiar concept to the general public, most of the economies of the world are corporatist in nature. The categories of socialist and pure market economy are virtually empty. There are only corporatist economies of various flavors.

These flavors of corporatism include the social democratic regimes of Europe and the Americas, but also the East Asian and Islamic fundamentalist regimes such as Taiwan, Singapore and Iran. The Islamic socialist states such as Syria, Libya and Algeria are more corporatist than socialist, as was Iraq under Saddam Hussain. The formerly communist regimes such as Russia and China are now clearly corporatist in economic philosophy although not in name.

The concept of Quite Coup

Sine ira et studio

Tacitus, see Wikipedia

The term "Quiet coup" which means the hijacking of the political power in the USA by financial oligarchy was introduced by Simon H. Johnson, a British-American economist, who currently is the Ronald A. Kurtz Professor of Entrepreneurship at the MIT Sloan School of Management and a senior fellow at the Peterson Institute for International Economics. From March 2007 through the end of August 2008, he was Chief Economist of the International Monetary Fund. The term was introduced in his article in Atlantic magazine, published in May 2009(The Quiet Coup - Simon Johnson - The Atlantic). Which opens with a revealing paragraph:

The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government

The wealth of financial sector gave it unprecedented opportunities of simply buying the political power iether directly or indirectly (via revolving door mechanism):

Becoming a Banana Republic

In its depth and suddenness, the U.S. economic and financial crisis is shockingly reminiscent of moments we have recently seen in emerging markets (and only in emerging markets): South Korea (1997), Malaysia (1998), Russia and Argentina (time and again). In each of those cases, global investors, afraid that the country or its financial sector wouldn’t be able to pay off mountainous debt, suddenly stopped lending. And in each case, that fear became self-fulfilling, as banks that couldn’t roll over their debt did, in fact, become unable to pay. This is precisely what drove Lehman Brothers into bankruptcy on September 15, causing all sources of funding to the U.S. financial sector to dry up overnight. Just as in emerging-market crises, the weakness in the banking system has quickly rippled out into the rest of the economy, causing a severe economic contraction and hardship for millions of people.

But there’s a deeper and more disturbing similarity: elite business interests—financiers, in the case of the U.S.—played a central role in creating the crisis, making ever-larger gambles, with the implicit backing of the government, until the inevitable collapse. More alarming, they are now using their influence to prevent precisely the sorts of reforms that are needed, and fast, to pull the economy out of its nosedive. The government seems helpless, or unwilling, to act against them.

Top investment bankers and government officials like to lay the blame for the current crisis on the lowering of U.S. interest rates after the dotcom bust or, even better—in a “buck stops somewhere else” sort of way—on the flow of savings out of China. Some on the right like to complain about Fannie Mae or Freddie Mac, or even about longer-standing efforts to promote broader homeownership. And, of course, it is axiomatic to everyone that the regulators responsible for “safety and soundness” were fast asleep at the wheel.

But these various policies — lightweight regulation, cheap money, the unwritten Chinese-American economic alliance, the promotion of homeownership—had something in common. Even though some are traditionally associated with Democrats and some with Republicans, they all benefited the financial sector. Policy changes that might have forestalled the crisis but would have limited the financial sector’s profits — such as Brooksley Born’s now-famous attempts to regulate credit-default swaps at the Commodity Futures Trading Commission, in 1998—were ignored or swept aside.

The financial industry has not always enjoyed such favored treatment. But for the past 25 years or so, finance has boomed, becoming ever more powerful. The boom began with the Reagan years, and it only gained strength with the deregulatory policies of the Clinton and George W. Bush administrations. Several other factors helped fuel the financial industry’s ascent. Paul Volcker’s monetary policy in the 1980s, and the increased volatility in interest rates that accompanied it, made bond trading much more lucrative. The invention of securitization, interest-rate swaps, and credit-default swaps greatly increased the volume of transactions that bankers could make money on. And an aging and increasingly wealthy population invested more and more money in securities, helped by the invention of the IRA and the 401(k) plan. Together, these developments vastly increased the profit opportunities in financial services.

Not surprisingly, Wall Street ran with these opportunities. 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 great wealth that the financial sector created and concentrated gave bankers enormous political weight — a weight not seen in the U.S. since the era of J.P. Morgan (the man). In that period, the banking panic of 1907 could be stopped only by coordination among private-sector bankers: no government entity was able to offer an effective response. But that first age of banking oligarchs came to an end with the passage of significant banking regulation in response to the Great Depression; the reemergence of an American financial oligarchy is quite recent.

He further researched this theme in his book 2010 book 13 Bankers The Wall Street Takeover and the Next Financial Meltdown  (ISBN 978-0307379054), coauthored with James Kwak. They also founded and regularly contributes to the economics blog The Baseline Scenario. See also History of Casino Capitalism

The net effect of the ideological counter-revolution based on market fundamentalism ideology was that it restored the power of financial oligarchy typical for Gilded Age. As Simon Johnson argues that was partially done by subverting regulators and that oversize institutions always disproportionately influence public policy:

The second problem the U.S. faces—the power of the oligarchy—is just as important as the immediate crisis of lending. And the advice from the IMF on this front would again be simple: break the oligarchy.

Oversize institutions disproportionately influence public policy; the major banks we have today draw much of their power from being too big to fail. Nationalization and re-privatization would not change that; while the replacement of the bank executives who got us into this crisis would be just and sensible, ultimately, the swapping-out of one set of powerful managers for another would change only the names of the oligarchs.

Ideally, big banks should be sold in medium-size pieces, divided regionally or by type of business. Where this proves impractical—since we’ll want to sell the banks quickly—they could be sold whole, but with the requirement of being broken up within a short time. Banks that remain in private hands should also be subject to size limitations.

This may seem like a crude and arbitrary step, but it is the best way to limit the power of individual institutions in a sector that is essential to the economy as a whole. Of course, some people will complain about the "efficiency costs" of a more fragmented banking system, and these costs are real. But so are the costs when a bank that is too big to fail—a financial weapon of mass self-destruction—explodes. Anything that is too big to fail is too big to exist.

To ensure systematic bank breakup, and to prevent the eventual reemergence of dangerous behemoths, we also need to overhaul our antitrust legislation. Laws put in place more than 100years ago to combat industrial monopolies were not designed to address the problem we now face. The problem in the financial sector today is not that a given firm might have enough market share to influence prices; it is that one firm or a small set of interconnected firms, by failing, can bring down the economy. The Obama administration’s fiscal stimulus evokes FDR, but what we need to imitate here is Teddy Roosevelt’s trust-busting.

Caps on executive compensation, while redolent of populism, might help restore the political balance of power and deter the emergence of a new oligarchy. Wall Street’s main attraction—to the people who work there and to the government officials who were only too happy to bask in its reflected glory—has been the astounding amount of money that could be made. Limiting that money would reduce the allure of the financial sector and make it more like any other industry.

Still, outright pay caps are clumsy, especially in the long run. And most money is now made in largely unregulated private hedge funds and private-equity firms, so lowering pay would be complicated. Regulation and taxation should be part of the solution. Over time, though, the largest part may involve more transparency and competition, which would bring financial-industry fees down. To those who say this would drive financial activities to other countries, we can now safely say: fine.

Two Paths

To paraphrase Joseph Schumpeter, the early-20th-century economist, everyone has elites; the important thing is to change them from time to time. If the U.S. were just another country, coming to the IMF with hat in hand, I might be fairly optimistic about its future. Most of the emerging-market crises that I’ve mentioned ended relatively quickly, and gave way, for the most part, to relatively strong recoveries. But this, alas, brings us to the limit of the analogy between the U.S. and emerging markets.

Emerging-market countries have only a precarious hold on wealth, and are weaklings globally. When they get into trouble, they quite literally run out of money—or at least out of foreign currency, without which they cannot survive. They must make difficult decisions; ultimately, aggressive action is baked into the cake. But the U.S., of course, is the world’s most powerful nation, rich beyond measure, and blessed with the exorbitant privilege of paying its foreign debts in its own currency, which it can print. As a result, it could very well stumble along for years—as Japan did during its lost decade—never summoning the courage to do what it needs to do, and never really recovering. A clean break with the past—involving the takeover and cleanup of major banks—hardly looks like a sure thing right now. Certainly no one at the IMF can force it.

In my view, the U.S. faces two plausible scenarios. The first involves complicated bank-by-bank deals and a continual drumbeat of (repeated) bailouts, like the ones we saw in February with Citigroup and AIG. The administration will try to muddle through, and confusion will reign.

Boris Fyodorov, the late finance minister of Russia, struggled for much of the past 20 years against oligarchs, corruption, and abuse of authority in all its forms. He liked to say that confusion and chaos were very much in the interests of the powerful—letting them take things, legally and illegally, with impunity. When inflation is high, who can say what a piece of property is really worth? When the credit system is supported by byzantine government arrangements and backroom deals, how do you know that you aren’t being fleeced?

Our future could be one in which continued tumult feeds the looting of the financial system, and we talk more and more about exactly how our oligarchs became bandits and how the economy just can’t seem to get into gear.

The second scenario begins more bleakly, and might end that way too. But it does provide at least some hope that we’ll be shaken out of our torpor. It goes like this: the global economy continues to deteriorate, the banking system in east-central Europe collapses, and—because eastern Europe’s banks are mostly owned by western European banks—justifiable fears of government insolvency spread throughout the Continent. Creditors take further hits and confidence falls further. The Asian economies that export manufactured goods are devastated, and the commodity producers in Latin America and Africa are not much better off. A dramatic worsening of the global environment forces the U.S. economy, already staggering, down onto both knees. The baseline growth rates used in the administration’s current budget are increasingly seen as unrealistic, and the rosy "stress scenario" that the U.S. Treasury is currently using to evaluate banks’ balance sheets becomes a source of great embarrassment.

Under this kind of pressure, and faced with the prospect of a national and global collapse, minds may become more concentrated.

The conventional wisdom among the elite is still that the current slump "cannot be as bad as the Great Depression." This view is wrong. What we face now could, in fact, be worse than the Great Depression—because the world is now so much more interconnected and because the banking sector is now so big. We face a synchronized downturn in almost all countries, a weakening of confidence among individuals and firms, and major problems for government finances. If our leadership wakes up to the potential consequences, we may yet see dramatic action on the banking system and a breaking of the old elite. Let us hope it is not then too late.

It is pretty interesting to see how financial oligarchy filters information provided to the population to fit their biases. For example, the key facts about repeal of Glass-Steagall law  (BTW Joe Biden voted for it) mostly hidden from the public: 

Commodity Futures Trading Commission — under the leadership of Mr. Gramm’s wife, Wendy — had approved rules in 1989 and 1993 exempting some swaps and derivatives from regulation. In December 2000, the Commodity Futures Modernization Act was passed as part of a larger bill by unanimous consent after Senator Gramm dominated the Senate debate...

"He was the architect, advocate and the most knowledgeable person in Congress on these topics," Mr. Donovan said. "To me, Phil Gramm is the single most important reason for the current financial crisis."

"The virtually unregulated over-the-counter market in credit-default swaps has played a significant role in the credit crisis, including the now $167 billion taxpayer rescue of A.I.G.," Christopher Cox, the chairman of the S.E.C. and a former congressman, said Friday.

But you will never find discussion of flaws and adverse consequences Phil Gram (or Greenspan for a change) initiatives in Heritage Foundation and other right-wing think tanks publications.

Stages of transformation

So what we are experiencing is a the completion of the transformation of one phase of capitalism to another. It happened in stages:

  1. Manufacturing stagnated and can't provide the "decent" rate of growth. Competition from re-built Europe and Asian markets severely stressed the US manufacturing. due to competition return of capital dropped and in several industries became negative.

  2. Computers brought innovations into financial markets. They make possible real time trading of induces like S&P500, complex financial instruments like derivatives, etc. Later they enables superfast trading (HFT). All those instruments dramatically increased the possibilities of extracting the rent by financial institutions from the society.

  3. Globalization kicked in due to new opportunities offered by high speed global communications (Internet). And that is not limited to outsourcing. Due to globalization the sheer size of the financial markets increased to the extent that they started to represent a different, new transnational phenomena allowing new types of redistribution of wealth to be practiced. Integration of Russian elite (oligarchs) is just one example of this process. In case of pro-western oligarchs (fifth column) West went to significant length to protect them and their racket (Mikhail Khodorkovsky - Wikipedia,)

  4. Commercial banks turned into investment banks to exploit this opportunity.

  5. Financial sector completely corrupted academic science converting most economists to pay prostitutes which serve their interests.

  6. Collapse of the USSR provided the financial sector major shoot in the arm and a golden, once in century opportunity to finance new half-billion consumers and stole for a penny on a dollar huge industrial assets and natural resources as well as put most of those countries in the debt (Latin-Americanization of xUSSR space). Harvard Mafia (with some support from London) did the bidding of western banks in xUSSR space. As more becomes known about the laundering of Russian money in Western banks, many in the United States will likely try to hide behind stories of faraway organized crime. But U.S. policy toward Russia has contributed to that country's sorry conditions--with the Harvard Institute for International Development's Russia project (HIID) playing a major role (Harvard's 'Best and Brightest' Aided Russia's Economic Ruin ). Professor Jeffery Sacks provided a bogus idea of "shock therapy" to achieve spectacular for Western banks result. As a result all xUSSR space became new Latin America with typical for Latin America problems like huge level of inequality, prostitution, child poverty, and prominent role of organized crime.

  7. Banks became dominant political force on western societies with no real counterbalance from other parts of the elite. The first president completely subservient to banking elite was elected in the USA in 1992. Bill Clinton regime lasted eight years and along with economic rape of xUSSR space in best colonial powers tradition, it removed what was left of financial regulations after the flurry of deregulation of the early 1980s. And they behaved as an occupying force not only in xUSSR space but in the USA as well. They deprived workers out of their jobs, they abolished the US pension system as it impede playing with population money and replaced in with widely inadequate 401K plans. They deprived municipalities out of their revenues and assets, while municipalities became just a den of bond traders looking for then next mark which give them the ability to put municipalities deeper in debt.

  8. Newly acquired political power of financial elite speeded the shift to bank "self-regulation" created huge shadow banking system which dwarf "official" under the smoke screen of "free-market" propaganda and PR from a coterie of corrupts academics (Chicago Scholl, Harvard Mafia, etc) . It engaged in pursuit of short term profits and self-enrichment of top brass which became new elite by-and-large displacing not only the old one, but also the newly minted IT elite of dot-com boom. Using newly acquired power financial elite remove all regulations that hamper their interests. Glass-Steagall was repealed at the last days of Clinton presidency, financial derivatives became unregulated.

  9. Deindustrialization kicked in. As financial speculation proved to be much more profitable to other activities deindustrialization kicked in the USA as the financial center of the world. Outsourcing which first was limited to manufacturing jobs now extent its reach on IT and decimate previously profitable sector and its export potential.

  10. Externalities can no longer be suppressed and economics became unstable. Growth of inequality, job insecurity, as well as frequency of financial crises were natural consequences of financialization of the economy. They create huge imbalances, like bubble in residential real estate which was blown with the help and full support of the USA government as a way to overcome dot-com crisis consequences.

  11. Debt crisis strikes. Growth of debt became unsustainable and produces the financial crisis of enormous proportions. By their reckless policies and greed financial sector caused huge financial crisis of 2008 and now they are forcing national governments to auction off their cultural heritage to the highest bidder. Everything must go in fire sales at prices rigged by twenty-something largest banks, the most corrupt institutions the world has ever known.

  12. Devastating "local" wars became "new normal". Due to financial crisis, the overconsumption in western economies came under threat. Debt expansion which led to overconsumption within the western economies affected (or infected) by financialization. To sustain the current standard of living financial expansion became the necessity. It took the form of a competition for spheres of influence in the area of energy supplies, which we see in post USSR space, Iraq, Libya and elsewhere. And central banks play critical role in financing wars. After all Banks of England was created with this exact purpose.

I think by 2008 when the second major financial crisis hit the USA, the transformation on the USA economy into casino capitalism, which is essentially implementation of neoliberal doctrine (or more correctly the US brand of corporatism) was by-and-large complete.

In short we are living in a new politico-economic system in which financial capital won victory over both labor and industrial capital. We might not like what we got, but financial elite is now a new ruling class and this fact is difficult to dispute. As a result. instead of the robber barons of the early 20th century (some of whom actually created/consolidated new industries), we have the top executives from investment banks, insurers and mortgage industry who represent a new Rentier class, much like old aristocracy.

They are living off parasitic monopolization of access to any (physical, financial, intellectual, etc.) kind of property and gaining significant amount of profit without contribution to society (see Rentier capitalism which is a very fuzzy term for neoliberal model of capitalism).

Casino Capitalism as a result of stagnation of industrial manufacturing

Stagnation of industrial manufacturing droved up financial speculation as the method to compensate for falling rate on return on capital. This stagnation became prominent during Reagan administration (which started the major shift toward neoliberalism), although signs of it were present from early 60th.

For example Chicago which was a manufacturing center since 1969 lost approximately 400K manufacturing jobs which were replaced mainly by FIRE-related jobs, In 1995 over 22% of those employed by FIRE industries (66K people) were working in executive and managerial positions. Another 17% are in marketing, sales and processional specialty occupations (computer system analysts, PR specialists, writer and editors).

Those changes in the structure of employment had several consequences:

  1. The stagnation of the underlying economy meant that capitalists were increasingly dependent on the growth of finance to preserve and enlarge their money capital.
  2. The financial superstructure of the capitalist economy could not expand independently of its base -- underlying productive economy — hence the bursting of speculative bubbles became a recurrent and growing problem.
  3. Financialization could never overcome stagnation of industrial production. It is just an opium for rich, not a structural adjustment of the stagnation-prone economy. But like addition to narcotics does to human body it does tremendous damage to real economy.
  4. Rapid increase in inequality is necessary to sustain the appetites of the elite in the system with fixed size of the pie. Politico-economic conditions might became even more unfavorable for labor. Stagnation of industrial production mean shrinking pie, which necessitates redistribution of wealth in favor of a new, all-powerful financial Rentier class. This redistribution resulted in partial wipe-out of large swats of middle class. For the past three decades, America has steadily converted itself into a nation of haves (as Bush II quipped "This is an impressive crowd -- the haves and the have mores! Some people call you the elite -- I call you my base". ) and have-nots. The cost of a college education rises rapidly at a time when wages for skilled labor stagnate, so access to college became against discriminated in favor of upper class of the society. Repressive apparatus and ideological brainwashing are too strong to mount effective resistance.

The key to understanding of Casino Capitalism is that it was a series of government decisions (or rather non-decisions) that converted the state into neoliberal model. In other words casino capitalism has distinct "Government property" mark. It was the USA elite, which refused to act responsibly in the face of changing economic conditions resulting from its own actions, and instead chose to try to perpetuate, by whatever means it had at its disposal, the institutional advantages of dollar as a reserve currency which it had vis-à-vis its main economic rivals and grab as large part of the world economic pie as it can. And this power grab was supported first of all by the role of dollar as currency in which oil is traded.

There might be some geo-strategically motives as well as the US elite in late 80th perceived that competitiveness is slipping out of the USA and the danger of deindustrialization is real. Many accuse Reagan with the desire to ride dollar status as a world reserve currency (exorbitant privilege) until the horse is dead. That's what real cowboys do in Hollywood movies... But the collapse of the main rival, the USSR vindicated this strategy and give a strong short in the arm to financialization of the economy. Actually for the next ten years can be called a triumphal ascend of financialization in the USA.

Dominance of FIRE industries clustered up and in recent years reached in the USA quite dramatic proportions. The old Bolsheviks saying "When we say Lenin we mean the Party and when we say the Party we mean Lenin" now can be reworded: "Now it we say US banks, we mean the US government and vise versa if we say US government we mean US banks".

According to the Center for Responsive Politics, the FIRE sector was and is the biggest contributor to federal candidates in Washington. Companies cannot give directly, so they leave it to bundlers to solicit maximum contributions from employees and families. They might have been brought down to earth this year, but they’ve given like Gods: Goldman Sachs, $4.8 million; Citigroup, $3.7 million; J.P. Morgan Chase & Co., $3.6 million; Merrill Lynch, $2.3 million; Lehman Brothers, $2.1 million; Bank of America, $2.1 million. Some think the long-term effect of such contributions to individual candidates was clear in the roll-call votes for the bailout.

Take the controversial first House vote on bailout of major banks on Sept. 29, 2008. According to CRP, the "ayes" had received 53 percent more contributions from FIRE since 1989 than those who voted against the bill, which ultimately failed 228 to 205. The 140 House Democrats who voted for the bill got an average of $188,572 in this election cycle, while the 65 Republicans backing it got an average of $185,461 from FIRE—about 23 percent more than the bill’s opponents received. A tinkered bill was passed four days later, 263 to 171.

According to the article Fire Sale (The American Conservative) half of Obama’s top ten contributors, together giving him nearly $2.2 million, are FIREmen. The $13 million contributed by FIRE executives to Obama campaign is probably an undercount. Democratic committee leaders are also dependent of FIRE contributions. The list includes Sen. Dodd ( please look at Senator Dodd's top donors for 2007-8 on openSecrets.org ) and Sen. Chuck Schumer ($12 million from FIRE since 1989), Rep. Barney Frank ($2.5 million), and Rep. Charlie Rangel ($4 million, the top recipient in the House). All of them have been accused of taking truckloads of contributions while failing to act on the looming mortgage crisis. Dodd finally pushed mortgage reform last year but by then as his hometown paper, The Hartford Courant stated, "the damage was done."

Casino Capitalism and Financial Instability

At the same time rise of financial capital dramatically increased instability. An oversized financial sector produces instability due to multiple positive feedback loops. In this sense we can talk about Financial Sector Induced Systemic Instability of Economy. The whole society became "House of cards", "Giant Enron" and "extension of Las Vegas". Reckless management, greed and out-right stupidity in playing derivatives games was natural consequence of the oversized financial sector, not just a human folly. In a way it was dramatic manifestation of the oversized financial sector negative influence of the economy. And in 2008 it did brought out economy to the brink of destruction. Peak oil added to suffocating effect on the economy of reckless gambling (and related debts) of financial sector producing the economic calamity that rivals Great Depression. Also, like Socialism, Casino Capitalism demands too much of its elite. And in reality, the financial elite much like Bolsheviks elite, is having its own interests above the interests of the society.

As Kevin Phillips noted "In the United States, political correctness, religious fundamentalism, and other inhibitions sometimes dumb down national debate". And the same statement is true for financial elite that became the center of power under the Casino Capitalism. Due to avalanche of greed the society became one giant Enron as money that are made from value addition in the form of manufacturing fade in significance to the volume of the money that is made from shuffling money around. In other was the Wall Street's locked USA in the situation from which there is no easy exit.

Self-reinforcing ‘positive’ feedback loops prevalent in Casino Capitalism trigger an accelerating creation of various debt instruments, interest of which at some point overwhelm the system carrying capacity. Ability to lend against good collateral is quickly exhausted. At some point apparently there is no good collateral against which lending freely was possible, even at high rates. This means that each new stage of financial innovation involves scam and fraud, on increasing scale. In other words Ponzi economy of "saving and loans" is replaced with Madoff economy.

Whether you shift the resulting huge private debt to public to increase confidence or not, the net result is of this development of events is a crisis and a huge debt that society needs to take. Actually the debt bubble in 2008 can only be compared to the debt bubble of 1933. The liquidation of Bear Sterns and Lehman was only a start of consolidation of finances and we need to find something that replace financial sector dominance in the national economy. It would be nice is some technological breakthrough happened which would lift the country out of this deep hole.

See Financial Sector Induced Systemic Instability of Economy for more details.

Neoliberalism as the Ideology of Casino Capitalism

Like Bolshevism was marked by deification of teaching of Marx and Lenin, converting them into pseudo-religious doctrine, the Casino Capitalism has its own deified ideological doctrine. It is the ideology of Neoliberalism. The latter as an ideology and an agenda seeks to topple democratic capitalism and replace it with a de facto unaccountable autocratic government which serves as channel of a wealth transfer from the public to a rentier elite. In a way it is a spectacular example of a successful (in a very negative sense) pseudo-religious doctrine.

Addiction of the societies to disastrous politico-economical doctrines are similar to addictions to alcohol and drugs in individuals. It is not easy to recover and it takes a long, long time and a lot of misery. As dissolution of the USSR aptly demonstrated not all societies can make it. In this case the USSR elite (nomenklatura) simply shed the old ideology as it understood that it will be better off adopting ideology of neoliberal capitalism; so it was revolution from above.  this abrupt switch created chaos in economics (which was applauded by Washington which under Clinton administration adopted the stance the Carnage needs to be destroyed and facilitated the process), criminal privatization of major industries, and pushed into object poverty the 99% of population of those countries. For some period under "drunk Yeltsyn" Russia sees to exist as an independent country and became a vassal of Washington.

This also means that "society at large" did not had effective brakes to the assent of financial plutocracy (aka financial oligarchy).  I would add to this the computer revolution and internet that made many financial transaction qualitatively different and often dramatically cheaper that in previous history. Computers also enabled creation of new financial players like mutual funds (which created a shadow banking system with their bond funds) , hedge funds, exchange-traded funds (ETFs), as well as high-frequency trading and derivatives.

From the historical view Reaganomics also can be considered to be the US flavor of Lysenkoism with economics instead of genetics as a target. Here is how Reaganomics is defined in Wikipedia

Reaganomics (a portmanteau of "Reagan" and "economics") refers to the economic policies promoted by United States President Ronald Reagan. The four pillars of Reagan's economic policy were to:[1]
  1. reduce the growth of government spending,
  2. reduce marginal tax rates on income from labor and capital,
  3. reduce government regulation of the economy,
  4. control the money supply to reduce inflation.

In attempting to cut back on domestic spending while lowering taxes, Reagan's approach was a departure from his immediate predecessors.

Reagan became president during a period of high inflation and unemployment (commonly referred to as stagflation), which had largely abated by the time he left office.

Please not that the Number 1 idea ("reduce government spending") was essentially a scam, a smoke screen designed to attract Rednecks as a powerful voting block. In a way this was a trick similar to one played by Bolsheviks in Russia with its "worker and peasants rule" smokescreen which covered brutal dictatorship. In reality all administrations which preached Reagonomics (including Clinton's) expanded the role of state and government spending. The number two was applied by-and-large to top 1%. The number three means deregulation in the interests of financial oligarchy and dismantling all social program that hamper profit of the latter (including privatizing of Social Security). The number fours is a scam, in the same sense as number one. As soon as financial institutions get in trouble, money are printed as if there is no tomorrow.

While the essence of Reagonomics was financial deregulation, the other important element was restoring the Gilded Age level of power of financial oligarchy which influence was diminished by FDR reforms. In this sense we can say that Reagan revolution was essentially a counter-revolution: an attempt to reverse the New Deal restrictions on financial sector and restore its dominance in the society.

Like it was the case in Bolshevism the ideology was developed and forced upon the society by a very small group of players. The key ideas of Casino Capitalism were formulated and implemented by Reagan administration with some contribution by Nixon (the role of rednecks aka "moral majority", "silent majority" as an important part of republican political base, which can be attracted to detrimental to its economic position policies by the smoke screen of false "moral" promises).

It was supported by each president after Reagan (paradoxically with Clinton having the most accomplished record -- he was the best Republican President in a very perverted way). Like in case of Lysenkoism opponents were purged and economic departments of the country were captured by principless careerists ready to tow the party line for personal enrichment. Like in case of Bolshevism, many of those special breed of careerists rotated from Republican Party into Fed and other government structures. A classic example of compulsive careerists that were used by finance sector to promote its interests was Alan Greenspan.

One of the key ideas of Reaganomics was the rejection of the sound approach that there should be a balance between too much government regulation and too little and that government role is important for smooth functioning of the market. In this area Reagan and its followers can be called Anarchists and their idea of 'free market" is a misnomer that masks the idea of "anarchic market" (corporate welfare to be exact -- as it was implemented). Emergence of corporate welfare Queens such as GS, Citi, AIG, are quite natural consequence of Reaganomics.

Reaganomics was a the US flavor of Lysenkoism with economics instead of generics as a target... It can and should be called Economic Lysenkoism.

The most interesting part of Reaganomics was that the power of this ideology made it possible to conditioned "working class" and middle class to act against their own economic interests. It helped to ensure the stagnation of wages during the whole 25 years period, which is close to what Soviets managed to achieve with working class of the USSR, but with much more resentment. This makes it in many ways very similar to Bolshevism as a whole, not just Lysenkoism (extremes meet or in less flattering way: "history repeats, first as a tragedy, then as farce).

Along with the term Reaganimics which implicitly stresses the deregulation, the other close term "market fundamentalism" is often used. Here is how market fundamentalism is defined (Longview Institute):

Market Fundamentalism is the exaggerated faith that when markets are left to operate on their own, they can solve all economic and social problems. Market Fundamentalism has dominated public policy debates in the United States since the 1980's, serving to justify huge Federal tax cuts, dramatic reductions in government regulatory activity, and continued efforts to downsize the government’s civilian programs.

Some level of government coercion (explicit or implicit ) is necessary for proper labeling of any pseudo-scientific theory with the term Lysenkoism. This holds true for both Market Fundamentalism (after all Reagan revolution was "revolution from above" by financial oligarchy and for financial oligarchy and hired guns from academia just do what powers that be expected) and, especially, Supply side economic. The political genius of those ideas is evident. Supply-side economics transformed Republicans from a minority party into a majority party. It allowed them to promise lower taxes, lower deficits and, in effect, unchanged spending. Why should people not like this combination? Who does not like a free lunch?

In this sense the Republican Party played the role very similar to the Communist Party of the USSR.

For example supply side economics was too bizarre and would never survive without explicit government support. This notion is supported by many influential observers. For example, in the following comment for Krugman article (Was the Great Depression a monetary phenomenon):

Market fundamentalism (neoclassical counter-revolution — to be more academic) was more of a political construct than based on sound economic theory. However, it would take a while before its toxic legacy is purged from the economics departments. Indeed, in some universities this might never happen.

Extreme deregulation and extreme regulation (Brezhnev socialism) logically meets and both represent a variant of extremely corrupt society that cannot be sustained for long (using bayonets as in the case of USSR or using reserve currency and increasing leverage as is the case of the USA). In both cases the societies were economically and ideologically bankrupt at the end.

Actually, elements of market fundamentalism looks more like religious doctrine than political philosophy — and that bonds its even closer to Lysenkoism. In both cases critics were silenced with the help of the state. It is interesting to note that Reaganomics was wiped into frenzy after the dissolution of the USSR, the country which gave birth to the term of Lysenkoism. In a way the last act of the USSR was to stick a knife in the back of the USA. As a side note I would like to stress that contrary to critics the USSR was more of a neo-feudal society with elements of slavery under Stalin. Gulag population were essentially state slaves; paradoxically a somewhat similar status is typical for illegal immigrants in industrialized countries. From this point of view this category of "state slaves" is generally more numerous that gulag inmates. Prison population also can be counted along those lines.

It look like either implicitly or explicitly Reagan's bet was on restoration of gilded Age with its dominance of financial oligarchy, an attempt to convert the USA into new Switzerland on the "exorbitant privilege" of dollar status as the global fiat currency.

Casino Capitalism is characterized by political dominance of FIRE industries (finance, insurance, and real estate) and diminished role of other and first of all manufacturing industries. It was also accompanied by the drastic growth of inequality (New Gilded Age). Its defining feature is "the triumph of the trader in assets over the long-term producer" in Martin Wolf's words.

Voodoo economic theories

Attempts of theoretical justification of Economic Lysenkoism fall into several major categories:

Those can be called pillars, cornerstones of Economic Lysenkoism. Each of the deserves as separate article (see links above).

Historically especially important was Chicago school of market fundamentalism promoted pseudo-scientific theories of Milton Freedman (Chicago School) as well as supply side economics.

Collapse of the USSR as ideological justification of Casino Capitalism superiority

The huge boost of Casino Capitalism was given by the collapse of the USSR in 1991. That gave a second life to Reagan era. Collapse of the USSR was used as a vindication of market fundamentalism. After it New Deal regulations were systematically destroyed. Dumped down variants of Nietzsche philosophy like bastardatized variant promoted by Russian emigrant became fashionable with an individual "creative" entrepreneur as a new Übermensch, which stands above morality.

"The word Übermensch [designates] a type of supreme achievement, as opposed to 'modern' men, 'good' men, Christians, and other nihilists ... When I whispered into the ears of some people that they were better off looking for a Cesare Borgia than a Parsifal, they did not believe their ears."[9] Safranski argues that the combination of ruthless warrior pride and artistic brilliance that defined the Italian Renaissance embodied the sense of the Übermensch for Nietzsche. According to Safranski, Nietzsche intended the ultra-aristocratic figure of the Übermensch to serve as a Machiavellian bogeyman of the modern Western middle class and its pseudo-Christian egalitarian value system.[10]

Brainwashing

The instability and volatility of active markets can devalue the economic base of real lives, or in more macro-scenarios can lead to the collapse of national and regional economies. In a very interesting and grotesque way it also incorporates the key element of Brezhnev Socialism in everyday life: huge manipulation of reality by mass media to the extend that Pravda and the USSR First TV Channel look pretty objective in comparison with Fox news and Fox controlled newspapers. Complete poisoning of public discourse and relying on the most ignorant part of the population as the political base (pretty much reminiscent of how Bolsheviks played "Working Class Dictatorship" anti-intellectualism card; it can be called "Rednecks Dictatorship").

The "heroes" or transformation of US economy to casino capitalism model

While transformation to casino capitalism was an objective development, there were specific individuals who were instrumental in killing New Deal regulations. We would single out the following twelve figures:

  1. Ronald Reagan (although first steps toward casino capitalism were made under Carter).
  2. Milton Friedman
  3. Alan Greenspan
  4. Phil Gramm
  5. Robert Rubin
  6. Larry Summers
  7. Helicopter Ben
  8. Bush II
  9. Bill Clinton
  10. Sandy Weill
  11. Jeffrey Sachs with his "shock therapy" racket
  12. Martin Feldstein

There is no question that Reagan and most of his followers (Greenspan, Rubin, Phil Gramm, etc) were rabid radicals blinded by ideology. But they were radicals of quite different color then FDR with disastrous consequences for society. Here again the analogy with Bolsheviks looms strong. In a way, they can be called financial terrorists inflicting huge damage on the nation and I wonder if RICO can be use to prosecute at least some of them.

In Bailout Nation (Chapter 19) Barry Ritholtz tried to rank major players that led country into the current abyss:

1. Federal Reserve Chairman Alan Greenspan
2. The Federal Reserve (in its role of setting monetary policy)
3. Senator Phil Gramm
4-6. Moody’s Investors Service, Standard & Poor’s, and Fitch Ratings (rating agencies)
7. The Securities and Exchange Commission (SEC)
8-9. Mortgage originators and lending banks
10. Congress
11. The Federal Reserve again (in its role as bank regulator)
12. Borrowers and home buyers
13-17. The five biggest Wall Street firms (Bear Stearns, Lehman Brothers, Merrill Lynch,Morgan Stanley, and Goldman Sachs) and their CEOs
18. President George W. Bush
19. President Bill Clinton
20. President Ronald Reagan
21-22. Treasury Secretary Henry Paulson
23-24. Treasury Secretaries Robert Rubin and Lawrence Summers
25. FOMC Chief Ben Bernanke
26. Mortgage brokers
27. Appraisers (the dishonest ones)
28. Collateralized debt obligation (CDO) managers (who produced the junk)
29. Institutional investors (pensions, insurance firms, banks, etc.) for
buying the junk
30-31. Office of the Comptroller of the Currency (OCC); Office of Thrift
Supervision (OTS)
32. State regulatory agencies
33. Structured investment vehicles (SIVs)/hedge funds for buying the junk

Early Researchers of Casino Capitalism

Hyman Minsky

Hyman Minsky argued that a key mechanism that pushes an economy towards a crisis is the accumulation of debt and the fact the financial system represents a positive feedback loop that tend to destabilize the system, creating ossilations in the form of boom and bust cycles. . He identified 3 types of borrowers that contribute to the accumulation of insolvent debt: Hedge Borrowers; Speculative Borrowers; and Ponzi Borrowers. That corresponds to three stages of Casino Capitalism of increasing fragility:

Growth of debt and increased levarate at some point create predocition of the crash. The stage of business cycle at which those preconditions are met is called "Minsky moment":

A Minsky moment is the point in a credit cycle or business cycle when investors are starting to have cash flow problems due to spiraling debt they have incurred in order to finance speculative or Ponzy investments.

At this point, a major selloff begins due to the fact that no counterparty can be found to bid at the high asking prices previously quoted, leading to a sudden and precipitous collapse in market clearing asset prices and a sharp drop in market liquidity.[1]

After the collapse of the USSR there were a lot of chest thumping of the status of America as a hyper power (American exceptionalism) and the "end of history" where neoliberalism that displaced Brazhvev socialism (and wiped out the socialist camp) was supposed to reign supreme forever.

But this triumphal march of neoliberalism was short lived. The system proved to be self-destructive due to strong positive feedback look from the unregulated financial sector.

But in 2000 the first moment to pay the piper arrives. It was postponed by Iraq war and housing bubble, but reappeared in much more menacing form in 2008. In 2009 the USA experienced a classic Minsky moment with high unemployment rate and economy suppressed by (and taken hostage) by Ponzi finance institutions which threaten the very survival of the capitalist system and way of life. Huge injection freom the state halped to save the economy from disintration, but the price was very high. And  after 2009 the US economy entered the period prologed stagnation, called  the perios of "secular stagnation".

In events preceding 2008 the shift from speculative toward Ponzi finance was speed up by increased corruption of major players.  The drive to redistribute wealth up destroyed any remnants of the rule of the law in the USA. It became a neo-feudal two casts society with "Masters of the Universe" as the upper cast (top 1% ) and "despicables" (lower 80%) as the lower cast. With some comprador strata of professional in between (top 20% or so), who generally support the upper cast.

Loweer cast experienced deterioration of the standard of living, loss of well paying jobs to outsourcing and offshoring and in 2016 revolted electing Trump, who defeated Hillary Clinton, who became a real symbol of the corruption of neoliberal system. 

"As Minsky observed, capitalism is inherently unstable. As each crisis is successfully contained, it encourages greater speculation and risk taking in borrowing and lending. Financial innovation makes it easier to finance various schemes. To a large extent, borrowers and lenders operate on the basis of trial and error. If a behavior is rewarded, it will be repeated. Thus stable periods naturally lead to optimism, to booms, and to increasing fragility.

A financial crisis can lead to asset price deflation and repudiation of debt. A debt deflation, once started, is very difficult to stop. It may not end until balance sheets are largely purged of bad debts, at great loss in financial wealth to the creditors as well as the economy at large."

For more information see

Susan Strange

For Strange the speed at which computerized financial markets work combined with their much larger size and  near-universal pervasiveness is an important qualitative change, that changes the social system into what he called "casino capitalism".  She actually popularized the term "Casino Capitalism" with her important book Casino Capitalism  published in 1997.

One of the side effects of this change is that volatility extends globally. Approximately $1.5 trillion dollars are invested daily as foreign transactions. It is estimated that 98% of these transactions are speculative. In comparison with this casino Las Vegas looks like a aborigine village in comparison with Manhattan.

Notes:

Susan Strange (June 9, 1923 - October 25, 1998) was a British academic who was influential in the field of international political economy. Her most important publications include

For a quarter of a century, Susan Strange was the most influential figure in British international studies. She held a number of key academic posts in Britain, Italy and Japan. From 1978 to 1988, she was Montague Burton Professor of International Relations at the London School of Economics and Political Science (LSE), the first woman to hold this chair and a professorial position in international relations at the LSE. She was a major figure in the professional associations of both Britain and the US: she was an instrumental founding member and first Treasurer of the British International Studies Association (BISA) [1] and the first female President of the International Studies Association (ISA) in 1995.

It was predominantly as a creative scholar and a forceful personality that she exercised her influence. She was almost single-handedly responsible for creating ‘international political economy’ and turning it into one of the two or three central fields within international studies in Britain, and she defended her creation with such robustness, and made such strong claims on its behalf, that her influence was felt—albeit not always welcomed—in most other areas of the discipline. She was one of the earliest and most influential campaigners for the closer integration of the study of international politics and international economics in the English language scholarship.

In the later period of her career, alongside the financial analyses offered in Casino Capitalism (the analysis in which she felt was vindicated by the South-East Asian financial crisis) and Mad Money, Strange's contributions to the field include her characterisation of the four different areas (production, security, finance and knowledge) through which power might be exercised in International Relations. This understanding of what she termed "structural power", formed the basis of her argument against the theory of American Hegemonic Decline in the early eighties.

Her analysis particularly in States and Markets focused on what she called the ‘market-authority nexus’, the see-saw of power between the market and political authority. The overall argument of her work suggested that the global market had gained significant power relative to states since the 1970s.

This led her to dub the Westphalia system Westfailure. She argued that a ‘dangerous gap’ was emerging between territorially-bound nation states and weak or partial intergovernmental cooperation in which markets had a free hand which could be constructive or destructive.

John K. Galbraith

Among important early critiques of casino capitalism was John K. Galbraith. He promoted a pretty novel idea that the major economic function of Governments is to strengthen countervailing powers to achieve some kind of balance between capital and labor.

While unions are far from being perfect and tend to slide into corruption due to "iron law of oligarchy" when thier management stop representing interests of thwe worksers and start to reprreesnt interest of thier own narry strate of fat cats,  there were the only sizable countewailing power that made the New Seal possible.

His prediction proved to be wrong as government actually represent the capitalist class and is not that interested in creating this balance, which was convincingly demonstrated by Thatcher and Reagan.  Both Britain and the USA start sliding into a new form of corporations, called neoliberalism which actually does not allocate any space for uniot at the negotiation table and strive for their complete elimination and "atomization" of work force, when each invididual is up to himself to find employment and group solidarity is suppressed by instilling neoliberal ideology in schools and universitites as well as via MSM (which in the USA surprisingly never were allowed to use the work neoliberlaism, as if it represents some secret Masonic cult)

And it does not look like there is any renewed support of unions right  (including important right to organize) at the  post subprime/derivatives/shadow_banking crisis stage of neoliberalism, when neoliberal ideology became sufficiently discredited to allow rise of populist politicians such as Trump. 

Still John K. Galbraith critique of primitive market fundamentalism of Milton Freedman and the whole pseudoscience of neoclassical economics which like Marxist political economy is one of there pillars of neoliberalism (along with Randism as philosophy and Neoconservatism or "Trotskyism for the rich" in politics), still has its value today. As Joseph Stiglitz noted (CSMonitor, Dec 28, 2006):

...In many ways, Galbraith was a more critical observer of economic reality.

Driven to understand market realities

Galbraith's vivid depictions of the good, bad, and ugly of American capitalism remain a sorely needed reminder that all is not quite as perfect as the perfect market models – with their perfect competition, perfect information, and perfectly rational consumers – upon which so much of Friedman's analysis depended.

Galbraith, who cut his teeth studying agricultural economics, strove to understand the world as it was, with all the problems of unemployment and market power that simplistic models of competitive markets ignore. In those models, unemployment didn't exist. Galbraith knew that made them fatally flawed

... ... ...

In his early research, Galbraith attempted to explain what had brought on the Great Crash of 1929 – including the role of the stock market's speculative greed fed by (what would today be called) irrational exuberance. Friedman ignored speculation and the failure of the labor market as he focused on the failures of the Federal Reserve. To Friedman, government was the problem, not the solution.

What Galbraith understood, and what later researchers (including this author) have proved, is that Adam Smith's "invisible hand" – the notion that the individual pursuit of maximum profit guides capitalist markets to efficiency – is so invisible because, quite often, it's just not there. Unfettered markets often produce too much of some things, such as pollution, and too little of other things, such as basic research. As Bruce Greenwald and I have shown, whenever information is imperfect – that is, always – markets are inefficient; hence the need for government action.

Galbraith reminded us that what made the economy work so well was not an invisible hand but countervailing powers. He had the misfortune of articulating these ideas before the mathematical models of game theory were sufficiently developed to give them expression. The good news is that today, more attention is being devoted to developing models of these bargaining relationships, and to complex, dynamic models of economic fluctuations in which speculation may play a central role.

Government's role

While Friedman never really appreciated the limitations of the market, he was a forceful critic of government. Yet history shows that in every successful country, the government had played an important role. Yes, governments sometimes fail, but unfettered markets are a certain prescription for failure. Galbraith made this case better than most.

Galbraith knew, too, that people aren't just rational economic actors, but consumers, contending with advertising, political persuasion, and social pressures. It was because of his close touch with reality that he had such influence on economic policymaking, especially during the Kennedy-Johnson years.

Galbraith's penetrating insights into the nature of capitalism – as it is lived, not as it is theorized in simplistic models – has enhanced our understanding of the market economy. He has left an intellectual legacy for generations to come. And he has left a gap in our intellectual life: Who will stand up against the economics establishment to articulate an economic vision that is both in touch with reality and comprehensible to ordinary citizens?

Galbraith was vindicated in his belief that the only economics possible is political economics and that government is always an agent of dominant class. As such it always pursue poklitics favorable to this class, just making marginal efforts to prevent the open revolt of lower classes.

In 2008 neoliberal economist such as Krugman and (to a lesse extent) Stiglitz both have eaten humble pie, because according to neoclassical economics the crises should not have happened. Both should now reread Galbraith's The Great Crash: 1929 (see also extracts).  Krugman also need to shred his previous writings with this mathiness execises of using differential equations to justify the dominance of financial oligarchy,  and eat them with borsch ;-)

BTW it is interesting that in 1996 neoliberal stooge Paul Krugman criticized limitations of Galbright vision in the following way:

To be both a liberal and a good economist you must have a certain sense of the tragic--that is, you must understand that not all goals can be attained, that life is a matter of painful tradeoffs. You must want to help the poor, but understand that welfare can encourage dependency. You must want to protect those who lose their jobs, but admit that generous unemployment benefits can raise the long-term rate of unemployment. You must be willing to tax the affluent to help those in need, but accept that too high a rate of taxation can discourage investment and innovation.

To the free-market conservative, these are all arguments for government to do nothing, to accept whatever level of poverty and insecurity the market happens to produce. A serious liberal does not reply to such conservatives by denying that there are any trade-offs at all; he insists, rather, that some trade-offs are worth making, that helping the poor and protecting the unlucky may have costs but will ultimately make for a better society.

The revelation one gets from reading John Kenneth Galbraith's The Good Society is that Galbraith--who is one of the world's most celebrated intellectuals, and whom one would expect to have a deeper appreciation of the complexity of the human condition than a mere technical economist would -- lacks this tragic sense. Galbraith's vision of the economy is one without shadows, in which what is good for social justice always turns out to have no unfavorable side effects. If this vision is typical of liberal intellectuals, the ineffectuality of the tribe is not an accident: It stems from a deep-seated unwillingness to face up to uncomfortable reality.

Similar limited understanding of Galbright is demonstrated in London Times (cited from comment to Economist's View blog) :

Some motifs of Galbraith’s work have entered popular consciousness. Galbraith wrote of private opulence amid public squalor, illustrating it with a memorable metaphor of a family that travels by extravagant private car to picnic by a polluted river.

Yet while arguing for increased public expenditure on welfare, Galbraith gave scant attention to the limits of that approach. His writings perpetuate a debilitating weakness of modern liberalism: a reluctance to acknowledge that resources are scarce.

In Galbraith’s scheme, said Herbert Stein, the former chairman of the Council of Economic Advisers: “The American people were only asked whether they wanted cleaner air and water . . . The answers to such questions seemed obvious — but they were not the right questions.”

Soros contribution to the understanding of growth of financial sector as source of new, global economic instability

This idea of "casino capitalism" as a driver of financial instability was developed further in the book The Crisis of Global Capitalism by prominent financial speculator and staunch neoliberal George Soros (1998), who after Minsky highlights the potential for disequilibrium in the financial system, and the inability of non-market sectors to regulate markets.

the latter is a prominant feature of Casino Capitalism, which can be defined as economic system were financial barons run amok.

Although the insights of the Soros critique of global capitalism are scarcely new, they were articulated with such candor and accuracy that the book made a significant impact. The following is a sampling of Soros' insights.
  1. Unregulated financial markets are inherently unstable. There is nothing new in this statement. It is just a repetition of what Keynes and Minsky said much more eloquently. But Soros made in important observation about the source of constant disequilibrium of markets under neoliberalism, the observation which permitted for him to achieve spectacular success as a financial speculator.  Soros observes that, contrary to conventional economic theory, financial markets are not driven toward a relatively stable and rational price by the objective value assessment of such things as the soundness of a company's management, products, or record of profitability. Rather they are constantly driven away from equilibrium by the momentum of self-fulfilling expectations -- a rising stock price attracts buyers who further raise the price-to the point of collapse. The recent massive inflation and subsequent collapse in the price of the shares of unprofitable dot-com companies illustrates Soros' point.

    Bank lending also contributes to the instability, because the price of real and financial assets is set in part by their collateral value. The higher their market price rises the larger the loans banks are willing to make to their buyers to bid up prices. When the bubble bursts, the value of the assets plummets below the amount of the money borrowed against them. This forces banks to call their loans and cut back on the lending, which depresses asset prices and dries up the money supply. The economy then tanks-until credit worthiness is restored and a new boom phase begins.

  2. Financial markets are amoral by definition. Following Napoleon Bonaparte ("Money has no motherland; financiers are without patriotism and without decency; their sole object is gain. "), Soros stressed that there is no meaningful place for individual moral behavior of financial oligarchy in the context of financial markets, because such behavior has no consequences for them other than to reduce the financial return of  a more  ethical actor.  In other words modern finance is breeding ground for ruthless sociopath, which we really observed during 2008.

    When I bought shares in Lockheed and Northrop after the managements were indicted for bribery, I helped sustain the price of their stocks. When I sold sterling short in 1992, the Bank of England was on the other side of my transactions, and I was in effect taking money out of the pockets of British taxpayers. But if I had tried to take social consequences into account, it would have thrown off my risk-reward calculation, and my profits would have been reduced.

    Soros argues that if he had not bought Lockheed and Northrop, then somebody else would have, and Britain would have devalued sterling no matter what he did. "Bringing my social conscience into the decision-making process would make no difference in the real world; but it may adversely affect my own results." One can challenge the Soros claim that such behavior is amoral rather than immoral, but his basic argument is accurate. His understanding that it is futile to look to individual morality as the solution to the excesses of financial markets is all too accurate.

  3. Corporate employees are duty-bound to serve only corporate financial interests. As such financial institution are closely related to organized crime and top layers of managers are essentially institualized criminals. Soros writes:

    Publicly owned companies are single-purpose organizations-their purpose is to make money. The tougher the competition, the less they can afford to deviate. Those in charge may be well-intentioned and upright citizens, but their room for maneuver is strictly circumscribed by the position they occupy.

     They are duty-bound to uphold the interests of the company. If they think that cigarettes are unhealthy or that fostering civil war to obtain mining concessions is unconscionable, they ought to quit their jobs. Their place will be taken by people who are willing to carry on.

    Though not specifically mentioned by Soros, this is why corporations were in the past (at least partially) excluded from the political processes (although it was never complete and it is well known fact that Crusades and Siege of Constantinople (1204) were financed by Genoese bankers upset by lack of access to the Byzantium markets). But at least formally other parts of the society can define their goals and the rules of the marketplace and suppress excessive appetities of banker, if nessesary by brute force.  Financial oligarchy is incapable of distinguishing between private corporate interests and broader public interests. And that situation became even worse with the the global dominance of corporatism in the form of neoliberalism.

  4. Financial markets are oblivious to externalities and are infected by "short-termism". Specifically the fact that a strategy or policy produces economic returns in the short-term does not mean the long-term results will be beneficial. The focus of financial markets is on short-term individual gain to the exclusion of both social and longer-term consequences. The fact that particular policies and strategies are effective in producing short-term financial returns does not mean they are more generally beneficial or desirable. Soros offers the example that running up a budget or trade deficit "feels good while it lasts, but there can be hell to pay later."

  5. The relationship between the center and the periphery of the capitalist system is profoundly unequal. The powerful countries at the center of the capitalist system are both wealthier and more stable than countries at the periphery because control of the financial system and ownership of productive assets allows them to shape economic and political affairs to their benefit.

    "Foreign ownership of capital deprives peripheral countries of autonomy and often hinders the development of democratic institutions. The international flow of capital is subject to catastrophic interruptions."

    In times of uncertainty financial capital tends to return to its country of origin, thus depriving countries at the periphery of the financial liquidity necessary to the function of monetized economies. "The center's most important feature is that it controls its own economic policies and holds in its hands the economic destinies of periphery countries."

  6. In the capitalist system greed (aka "monetary values") tend to displace social values in sectors where this is destructive to important public interests. Soros writes:

    Monetary values [under neoliberalism] have usurped the role of intrinsic values, and markets have come to dominate spheres of existence where they do not properly belong.

    Law and medicine, politics, education, science, the arts, even personal relations-achievements or qualities that ought to be valued for their own sake are converted into monetary terms; they are judged by the money they fetch rather than their intrinsic value."

    Because financial "capital is free to go where most rewarded, countries vie to attract and retain capital, and if they are to succeed they must give precedence to the requirements of international capital over other social objectives.

Ha-Joon Chang

One notable later researcher of casino capitalism, especially "free market" fundamentalism propaganda Cambridge University researcher Ha-Joon Chang. In 2011 he published a fascinating book 23 Things They Don't Tell You About Capitalism. Here is a Youtube lecture at LSE (23 Things They Don't Tell You About Capitalism  ). We will reproduce  two Amazon reviews that shed some light at the key ideas of the book:

William Podmore

Ha-Joon Chang, Reader in the Political Economy of Development at Cambridge University, has written a fascinating book on capitalism's failings. He also wrote the brilliant Bad Samaritans. Martin Wolf of the Financial Times says he is `probably the world's most effective critic of globalization'.

Chang takes on the free-marketers' dogmas and proposes ideas like

He notes that the USA does not have the world's highest living standard. Norway, Luxemburg, Switzerland, Denmark, Iceland, Ireland, Sweden and the USA, in that order, had the highest incomes per head. On income per hours worked, the USA comes eighth, after Luxemburg, Norway, France, Ireland, Belgium, Austria and the Netherlands. Japan, Switzerland, Singapore, Finland and Sweden have the highest industrial output per person.

Free-market politicians, economists and media have pushed policies of de-regulation and pursuit of short-term profits, causing less growth, more inequality, more job insecurity and more frequent crises. Britain's growth rate in income per person per year was 2.4 per cent in the 1960s-70s and 1.7 per cent 1990-2009. Rich countries grew by 3 per cent in the 1960s-70s and 1.4 per cent 1980-2009. Developing countries grew by 3 per cent in the 1960s-70s and 2.6 per cent 1980-2009. Latin America grew by 3.1 per cent in the 1960s-70s and 1.1 per cent 1980-2009, and Sub-Saharan Africa by 1.6 per cent in the 1960s-70s and 0.2 per cent 1990-2009. The world economy grew by 3.2 per cent in the 1960s-70s and 1.4 per cent 1990-2009.

So, across the world, countries did far better before Thatcher and Reagan's `free-market revolution'. Making the rich richer made the rest of us poorer, cutting economies' growth rates, and investment as a share of national output, in all the G7 countries.

Chang shows how free trade is not the way to grow and points out that the USA was the world's most protectionist country during its phase of ascendancy, from the 1830s to the 1940s, and that Britain was one of world's the most protectionist countries during its rise, from the 1720s to the 1850s.

He shows how immigration controls keep First World wages up; they determine wages more than any other factor. Weakening those controls, as the EU demands, lowers wages.

He challenges the conventional wisdom that we must cut spending to cut the deficit. Instead, we need controls capital, on mergers and acquisitions, and on financial products. We need the welfare state, industrial policy, and huge investment in industry, infrastructure, worker training and R&D.

As Chang points out, "Even though financial investments can drive growth for a while, such growth cannot be sustained, as those investments have to be ultimately backed up by viable long-term investments in real sector activities, as so vividly shown by the 2008 financial crisis."

This book is a commonsense, evidence-based approach to economic life, which we should urge all our friends and colleagues to read.

Loyd E. Eskildson

The 2008 'Great Recession' demands re-examination of prevailing economic thought - the dominant paradigm (post 1970's conservative free-market capitalism) not only failed to predict the crisis, but also said it couldn't occur in today's free markets, thanks to Adam Smith's 'invisible hand.' Ha-Joon Chang provides that re-examination in his "23 Things They Don't Tell You About Capitalism." Turns out that the reason Adam Smith's hand was not visible is that it wasn't there. Chang, economics professor at the University of Cambridge, is no enemy of capitalism, though he contends its current conservative version should be made better. Conventional wisdom tells us that left alone, markets produce the most efficient and just outcomes - 'efficient' because businesses and individuals know best how to utilize their resources, and 'just' because they are rewarded according to their productivity. Following this advice, countries have deregulated businesses, reduced taxes and welfare, and adopted free trade. The results, per Chang, has been the opposite of what was promised - slower growth and rising inequality, often masked by rising credit expansion and increased working hours. Alternatively, developing Asian countries that grew fast did so following a different version of capitalism, though to be fair China's version to-date has also produced much greater inequality. The following summarizes some of Chang's points:

  1. "There is no such thing as a free market" - we already have hygiene standards in restaurants, ban child labor, pollution, narcotics, bribery, and dangerous workplaces, require licenses for professions such as doctors, lawyers, and brokers, and limit immigration. In 2008, the U.S. used at least $700 billion of taxpayers' money to buy up toxic assets, justified by President Bush on the grounds that it was a necessary state intervention consistent with free-market capitalism. Chang's conclusion - free-marketers contending that a certain regulation should not be introduced because it would restrict market freedom are simply expressing political opinions, not economic facts or laws.
  2. "Companies should not be run in the interest of their owners." Shareholders are the most mobile of corporate stakeholders, often holding ownership for but a fraction of a second (high-frequency trading represents 70% of today's trading). Shareholders prefer corporate strategies that maximize short-term profits and dividends, usually at the cost of long-term investments. (This often also includes added leverage and risk, and reliance on socializing risk via 'too big to fail' status, and relying on 'the Greenspan put.') Chang adds that corporate limited liability, while a boon to capital accumulation and technological progress, when combined with professional managers instead of entrepreneurs owning a large chunk (e.g.. Ford, Edison, Carnegie) and public shares with smaller voting rights (typically limited to 10%), allows professional managers to maximize their own prestige via sales growth and prestige projects instead of maximizing profits. Another negative long-term outcome driven by shareholders is increased share buybacks (less than 5% of profits until the early 1980s, 90% in 2007, and 280% in 2008) - one economist estimates that had GM not spent $20.4 billion on buybacks between 1986 and 2002 it could have prevented its 2009 bankruptcy. Short-term stockholder perspectives have also brought large-scale layoffs from off-shoring. Governments of other countries encourage longer-term thinking by holding large shares in key enterprises (China Mobile, Renault, Volkswagen), providing greater worker representation (Germany's supervisory boards), and cross-shareholding among friendly companies (Japan's Toyota and its suppliers).
  3. "Free-market policies rarely make poor countries rich." With a few exceptions, all of today's rich countries, including Britain and the U.S., reached that status through protectionism, subsidies, and other policies that they and their IMF, WTO, and World Bank now advise developing nations not to adopt. Free-market economists usually respond that the U.S. succeeded despite, not because of, protectionism. The problem with that explanation is the number of other nations paralleling the early growth strategy of the U.S. and Britain (Austria, Finland, France, Germany, Japan, Korea, Singapore, Sweden, Taiwan), and the fact that apparent exceptions (Hong Kong, Switzerland, The Netherlands) did so by ignoring foreign patents (a free-market 'no-no'). Chang believes the 'official historians' of capitalism have been very successful re-writing its history, akin to someone trying to 'kick away the ladder' with which they had climbed to the top. He also points out that developing nations that stick to their Ricardian 'comparative advantage,' per the conservatives prescription, condemn themselves to their economic status quo.
  4. "We do not live in a post-industrial age." Most of the fall in manufacturing's share of total output is not due to a fall in the quantity of manufactured goods, but due to the fall in their prices relative to those for services, caused by their faster productivity growth. A small part of deindustrialization is due to outsourcing of some 'manufacturing' activities that used to be provided in-house - e.g.. catering and cleaning. Those advising the newly developing nations to skip manufacturing and go directly to providing services forget that many services mainly serve manufacturing firms (finance, R&D, design), and that since services are harder to export, such an approach will create balance-of-payment problems. (Chang's preceding points directly contradict David Ricardo's law of comparative advantage - a fundamental free market precept. Chang's example of how Korea built Pohang Steel into a strong economic producer, despite lacking experienced managers and natural resources, is another.)
  5. "The U.S. does not have the highest living standard in the world." True, the average U.S. citizen has greater command over goods and services than his counterpart in almost any other country, but this is due to higher immigration, poorer employment conditions, and working longer hours for many vs. their foreign counterparts. The U.S. also has poorer health indicators and worse crime statistics. We do have the world's second highest income per capita - Luxemburg's higher, but measured in terms of purchasing power parity (PPP) the U.S. ranks eighth. (The U.S. doesn't have the fastest growing economy either - China is predicted to pass the U.S. in PPP this coming decade.) Chang's point here is that we should stop assuming the U.S. provides the best economic model. (This is already occurring - the World Bank's chief economist, Justin Lin, comes from China.)
  6. "Governments can pick winners." Chang cites examples of how the Korean government built world-class producers of steel (POSCO), shipbuilding (Hyundai), and electronics (LG), despite lacking raw materials or experience for those sectors. True, major government failures have occurred - Europe's Concorde, Indonesia's aircraft industry, Korea's promotion of aluminum smelting, and Japan's effort to have Nissan take over Honda; industry, however, has also failed - e.g.. the AOL-Time Warner merger, and the Daimler-Chrysler merger. Austria, China, Finland, France, Japan, Norway, Singapore (in numerous other areas), and Taiwan have also done quite well with government-picked winners. Another problem is that business and national interests sometimes clash - e.g.. American firms' massive outsourcing has undermined the national interest of maintaining full employment. (However, greater unbiased U.S. government involvement would be difficult due to the 10,000+ corporate lobbyists and billions in corporate campaign donations - $500 million alone from big oil in 2009-10.) Also interesting to Chang is how conservative free marketing bankers in the U.S. lined up for mammoth low-cost loans from the Federal Reserve at the beginning of the Great Recession. Government planning allows minimizing excess capacity, maximizing learning-curve economies and economies of scale and scope; operational performance is enhanced by also forcing government-owned or supported firms into international competition. Government intervention (loans, tariffs, subsidies, prohibiting exports of needed raw materials, building infrastructure) are necessary for emerging economies to move into more sophisticated sectors.
  7. "Making rich people richer doesn't make the rest of us richer." 'Trickle-down' economics is based on the belief that the poor maximize current consumption, while the rich, left to themselves, mostly invest. However, the years 1950-1973 saw the highest-ever growth rates in the U.S., Canada, Australia, and New Zealand, despite increased taxation of the rich. Before the 'Golden Age,' per capita income grew at 1-1.5%/year; during the Golden Age it grew at 2-3% in the U.S. Since then, tax cuts for the rich and financial deregulation have allowed greater paychecks for top managers and financiers, and between 1979 and 2006 the top 0.1% increased their share of national income from 3.5% to 11.6%. The result - investment as a ratio of national output has fallen in all rich economies and the pace at which the total economic pie grew decreased.
  8. "U.S. managers are over-priced." First, relative to their predecessors (about 10X those in the 1960s; now 300-400X the average worker), despite the latter having run companies more successfully, in relative terms. Second, compared to counterparts in other rich countries - up to 20X. (Third, compared to counterparts in developing nations - e.g.. JPMorgan Chase, world's 4th largest bank, paid its CEO $19.6 million in 2008, vs. the CEO of the Industrial and Commercial Bank of China, the world's largest, being paid $234,700. Read more ›

Willem Buiter and the idea of long term stagnation

Willem Buiter in his FT article After the Crisis Macro Imbalance, Credibility and Reserve-Currency suggested that after financial crisis of 2008 there might be very long a painful deleveraging period aka secular stagnation.  He was right.

In short each financial crisis make recovery longer and longer. That's why the US will most likely face a long period of stagnation: the digestion of huge excessive debt of the private sector might well take a decade:

Since the excess of debt is relative to income and GDP, the lower the rate of growth, the longer the required period of digestion. This explains for the paradox of trying to stimulate consumption when the economy faces a monumental crisis provoked exactly by excessive debt and excessive consumption. A cartoon line best captured the spirit of it: "country addicted to speculative bubbles desperately searches a new bubble to invest in. "

... ... ...

The roots of the crisis are major international macroeconomic imbalances. Despite the fact that the excesses of the financial system were instrumental to lead these imbalances further than otherwise possible, insufficient regulation should not be viewed as the main factor behind the crisis. The expenditure of central countries, spinned by all sort of financial innovations created by a globalized financial system, was the engine of world growth. When debt became clearly excessive in central countries and the debt-financed expenditure cycle came to an end, the ensuing crisis paralyzed the world economy. With the lesson of 1929 well assimilated, American monetary policy became aggressively expansionist. The Fed inundated the economy with money and credit, in the attempt to avoid a deep depression. Even if successful, the economies of the US and the other central countries, given the burden of excessive debt, are likely to remain stagnant under the threat of deflation for the coming years. The assumption of troubled assets by the public sector, in order to avoid the collapse of the financial system, might succeed, but at the cost of a major increase in public debt. Fiscal policy is not efficient to restart the economy when the private sector remains paralyzed by excessive debt. Even if a coordinated effort to increase public expenditure is successful, the central economies will remain stagnant for as long as the excessive indebtedness of the private sector persists. The period of digestion of excess debt will be longer than the usual recessive cycle. Since imports represent a drain in the effort to reanimate domestic demand through public expenditure, while exports, on the contrary, contribute to the recovery of internal demand, the temptation to central economies to also adopt a protectionist stance will be strong.

Willem Buiter also defined ‘cognitive regulatory capture’ which existed during the Greenspan years and when the Fed were just an arm of Wall Street.

This regulatory capture has resulted in an excess sensitivity of the Fed to financial market and financial sector concerns and fears and in an overestimation of the strength of the link between financial market turmoil and financial sector deleveraging and capital losses on the one hand, and the stability and prosperity of the wider economy on the other hand. The paper gives five examples of recent behavior by the Fed that are most readily rationalized with the assumption of regulatory capture. The abstract of the paper follows next. The latest version of the entire enchilada can be found here. Future revisions will also be found there.

Joseph Stiglitz on 5 steps to Casino Capitalism

Stiglitz is very unene and early Striglist was actually defender of neoliberalism (aka casino capitalism). Later he became a critic. In his 2008 Vanity Fair article Capitalist Fools Stiglitz identifies five key steps in transformation of American capitalism to Casino Capitalism (moments of failure as he called them):

No. 1: Reagan Fires Fed Chairman Volcker and Replaces Him With Greenspan in 1987:

Volcker also understood that financial markets need to be regulated. Reagan wanted someone who did not believe any such thing, and he found him in a devotee of the objectivist philosopher and free-market zealot Ayn Rand.

snip

If you appoint an anti-regulator as your enforcer, you know what kind of enforcement you’ll get. A flood of liquidity combined with the failed levees of regulation proved disastrous.

Greenspan presided over not one but two financial bubbles.

  1. Congress repealed the Glass-Steagall Act in 1999 under Bill Clinton (Glass-Steagall was a depression-era reform that separated commercial and investment banks)

I had opposed repeal of Glass-Steagall. The proponents said, in effect, Trust us: we will create Chinese walls to make sure that the problems of the past do not recur. As an economist, I certainly possessed a healthy degree of trust, trust in the power of economic incentives to bend human behavior toward self-interest—toward short-term self-interest, at any rate, rather than Tocqueville’s "self interest rightly understood."

Stiglitz also refers to a 2004 decision by the SEC "to allow big investment banks to increase their debt-to-capital ratio (from 12:1 to 30:1, or higher) so that they could buy more mortgage-backed securities, inflating the housing bubble in the process."

Once more, it was deregulation run amuck, and few even noticed.

  1. The Bush tax cuts, both on income and capital gains

The Bush administration was providing an open invitation to excessive borrowing and lending—not that American consumers needed any more encouragement.

  1. Faking the Numbers

Here he refers to bad accounting, the failure to address problems with stock options, and the incentive structures of ratings agencies like Moodys that led them to give high ratings to toxic assets.

  1. Paulson and the Flawed Bailout

Valuable time was wasted as Paulson pushed his own plan, "cash for trash," buying up the bad assets and putting the risk onto American taxpayers. When he finally abandoned it, providing banks with money they needed, he did it in a way that not only cheated America’s taxpayers but failed to ensure that the banks would use the money to re-start lending. He even allowed the banks to pour out money to their shareholders as taxpayers were pouring money into the banks.

Stiglitz concludes:

The truth is most of the individual mistakes boil down to just one: a belief that markets are self-adjusting and that the role of government should be minimal. Looking back at that belief during hearings this fall on Capitol Hill, Alan Greenspan said out loud, "I have found a flaw." Congressman Henry Waxman pushed him, responding, "In other words, you found that your view of the world, your ideology, was not right; it was not working." "Absolutely, precisely," Greenspan said. The embrace by America—and much of the rest of the world—of this flawed economic philosophy made it inevitable that we would eventually arrive at the place we are today.

The flawed economic philosophy brought by Reagan, and embraced by so many, brought us to this day. Ideas have consequences, especially when we stop empirically testing them. Republican economics have created great pain to America and harmed our national interest.

The flaw that Greenspan found was always there: self-regulation does not work. As Stiglitz said:

As an economist, I certainly possessed a healthy degree of trust, trust in the power of economic incentives to bend human behavior toward self-interest — toward short-term self-interest

Yes, for all their claims to science, the premise conflicts with tendencies of people.

This is the real legacy of Ronald Reagan and Alan Greenspan:

The whole scheme was kick-started under Ronald Reagan. Between his tax cuts for the rich and the Greenspan Commission’s orchestrated Social Security heist, working Americans lost out in a generational wealth transfer shift now exceeding $1 trillion annually from 90 million working class households to for-profit corporations and the richest 1% of the population. It created an unprecedented wealth disparity that continues to grow, shames the nation and is destroying the bedrock middle class without which democracy can’t survive.

Greenspan helped orchestrate it with economist Ravi Batra calling his economics "Greenomics" in his 2005 book "Greenspan’s Fraud." It "turns out to be Greedomics" advocating anti-trust laws, regulations and social services be ended so "nothing....interfere(s) with business greed and the pursuit of profits."

 Conclusions: From Animal Farm To Animal House

Instead of conclusion I will reproduce the post from Sudden Debt (March 17, 2008):

In Orwell's Animal Farm all animals are equal - except that some are more equal than others. All in the spirit of law, order and the proper functioning of society, of course. Fittingly, the animals that have chosen this role by themselves and for themselves, are the pigs.

Cut to US financial markets today. After years of swinish behavior more reminiscent of Animal House than anything else, the pigs are threatening to destroy the entire farm. As if it wasn't enough that they devoured all the "free market" food available and inundated the world with their excreta, they now wish to be put on the public trough. Truly, some businessmen believe they are more equal than others.

But do not blame the pigs; they are expected to act as swine nature dictates. The fault lies entirely with the farmers, those authorities entrusted by the people to oversee the farm because they supposedly knew better. While the pigs were rampaging and tearing the place apart, they were assuring us all that farms function best when animals are free to do as they please, guided solely by invisible hooves. No regulation, no oversight, no common sense. Oh yes, and pigs fly..

So what is to be done now? Two things:

In other words, the focus from now on should be on adding value by means of work and savings (capital formation), instead of inflating assets and borrowing.

Furthermore, we should realize that in a world already inhabited by close to 7 billion people and beset by resource depletion and environmental degradation, defending growth for growth's sake is a losing proposition. The wheels are already wobbling on the Permagrowth model; pumping harder on the accelerator is not going to make it go any faster and will likely result in a fatal crash.

Debt, and finance in general, should be left to re-size downwards to a level that better reflects the carrying capacity of our world. The Fed's current actions are shortsighted and "conservative" in the worst interpretation of the words: they are designed to artificially maintain debt at levels that myopically projects growth as far as the eye can see.

What level of resizing may be necessary? I hope not as much as at Bear Stearns, which got itself bought by Morgan at buzz-saw prices: $2 per share represents a 98% discount from its $84 book value. What scares me, though, is the statement by Morgan's CFO, who said the price reflected the risk the firm was taking, even though he was comfortable with the valuation of assets in Bear's books. It "...gives us the flexibility and margin of error that's appropriate given the speed at which the transaction came together", he said.

If it takes a 98% discount and the explicit guarantee of the Fed for a large portion of assets to buy one of the largest investment banks in the world, where should all other financial firms be trading at? ....Hello? Anyone? Is that a great big silence I hear, or the sound of credit imploding into a vacuum?


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[Nov 09, 2019] The Managers' Coup d'Etat in Health Care Appears Complete - a Study of Top Health Care Influencers

Nov 09, 2019 | www.nakedcapitalism.com

The authors concluded that

perceived influence over US health care of chief executives of health systems is increasing. To the extent that the ranking validly reflects influence, the sharp rise in the influence of chief executive officers at the expense of representatives of patients or health professionals may underscore the increasing industrialization of health care. It is not possible to find patients, patient advocates, clinicians, or clinician advocates at the top of this list . This trend placing health care influencers within C-suites, accountable to boards mostly comprising other corporate leaders, may explain the rise of business language and thinking

They suggested that it is possible that there is a

causal association between the concentration of executive influence and problems of patient care derived from efforts to optimize operational efficiency and financial performance, for example, clinician burnout , the heavy burden of treatment afflicting patients with chronic conditions, and the erection of barriers to care to optimize 'payer mix.'

Dr Montori also said in the interview

Americans increasingly find themselves in a corporate-centric healthcare echo-chamber , one in which the public will increasingly approach tough policy decisions having heard only the viewpoint from the top.

'The primary goals of CEOs are to advance the mission of their organization,' Montori says. 'If all that influences healthcare are the ideas of people who advocate for the success of their organizations, people who are not served by them will not have their voices heard.'

Furthermore, he suggested that the public may be befuddled by the current health policy debates, including those about universal health care and the possibility of reducing the power of commercial health insurance companies because

in the rest of the narrative all that they hear is about are the successes of biotech, the successes of tech companies, and the successes of healthcare corporations who achieve high levels of innovation thanks to the bold leadership of their executives. It's why we have been calling for greater awareness of the industrialization of healthcare for some time now

Summary

The new study by Longman, Ponce, Alvarez-Villalobos and Montori adds to the evidence that health care has been taken over by business-trained managers, and in the US, especially by large commercial health care organizations run by such managers.

Since we started Health Care Renewal , we have frequently discussed the rise of generic managers, which later we realized has been called managerialism. Managerialism is the belief that trained managers are better leaders of health care, and every other sort of organization, than are than people familiar with the particulars of the organizations' work. Managerialism has become an ascendant value in health care over the last 30 years. The majority of hospital CEOs are now management trained, but lacking in experience and training in medicine, direct health care, biomedical science, or public health. And managerialism is now ascendant in the US government. Our president, and many of his top-level appointees, are former business managers without political experience or government experience.

We noted an important article in the June, 2015 issue of the Medical Journal of Australia(1) that made these points:

– businesses of all types are now largely run by generic managers, trained in management but not necessarily knowledgeable about the details of the particular firm's business
– this change was motivated by neoliberalism (also known as economism or market fundamentalism )
– managerialism now affects all kinds of organizations, including health care, educational and scientific organizations
– managerialism makes short-term revenue the first priority of all organizations
– managerialism undermines the health care mission and the values of health care professionals

Generic or managerialist managers by definition do not know much about health care, or about biomedical science, medicine, or public health. They are prototypical ill-informed leadership , and hence may blunder into actual incompetence. They are trained that they have a right to lead any sort of organization, which breeds arrogance. These managers are not taught about the values of health care professionals. Worse, they are taught in their business style training about the shareholder value dogma, which states that the main objective of any organization is to increase revenue. Thus, they often end up hostile to the fundamental mission of health care, to put care of the patient and the health of the population ahead of all other concerns, which we have called mission-hostile management. (Furthermore, it appears that the shareholder value dogma is just smokescreen to cover the real goal of managers, increasing their own wealth, e.g., look here .) Finally, arrogance and worship of revenue allows self-interested and conflicted, and even sometimes corrupt leadership.

Managerialists may be convinced that they are working for the greater good. However, I am convinced that our health care system would be a lot less dysfunctional if it were led by people who actually know something about biomedical science, health care, and public health, and who understand and uphold the values of health care and public health professionals – even if that would cost a lot of very well paid managerialists their jobs.

Maybe someday the top "influencers" in health care will actually be people who know something about health care and actually care about patients' and the public's health.


1 Kings , November 9, 2019 at 4:51 am

'We've got to protect our phoney-baloney jobs, gentlemen.' William J. Le Petomane

James Miller , November 9, 2019 at 4:58 am

John Raulston Saul, in "Voltaire's Bastards", has produced an intellectual fireworks display that deals directly with the problem Dr.Poses sees pretty clearly. Endhoven proposes an attack on what he sees as a regressive medieval remnant, a Guild, an attack that has been pretty successful in a broad swath of our neoliberal world. Saul would recognize that attack immediately, and despise it. It's what he wrote about with such fiery contempt.. And in my opinion, he's right.

Managerialists, purveyors of "reason", are leaving a trail of disaster in pretty much every area where their influence is powerful. Their ivy league, MBA-dominated education seemingly has failed to provide any sense of the human feelings and needs that must be an essential part of successful planning or policy. The bottom line trumps all else, and generates disaster as well as shareholder value. Treat yourself, as well as tantalize your wits. Read it.

flora , November 9, 2019 at 5:20 am

Thanks for this post. Two quotes that sum up much of the overpriced disfunction, imo.

Managerialism is the belief that trained managers are better leaders of health care, and every other sort of organization, than are than people familiar with the particulars of the organizations' work.

Better leaders toward what goal?

– managerialism makes short-term revenue the first priority of all organizations

Brooklin Bridge , November 9, 2019 at 6:54 am

managerialism makes short-term revenue the first priority of all organizations

Except when it comes to manufacturing ideologies. There, they are quite capable of taking the long view with think tanks, generational influence (stacking) of the judical system, education, politics and policy and so on.* It's not as if they are unaware of the concept of laying foundations. But short term revenue seems to be tightly coupled in their view to what they get to put in their pockets which in turn (perhaps ironically by the foundation builders: self worth by comparative metrics) has been tightly coupled to their perceived worth as human beings.

(Ultimately, I believe, the phenomenon of comparative metrics literally projects the homeless -or in this case the paucity of care for whole segments of society- into existence and maintains their numbers in relation to those of the "managers.") Interestingly, the mix of origins, whether such seminal ideas ( "eat your vegetables, think of the starving Chineese" ) are vernacular and borrowed and repurposed or canonical and disseminated helps in no small part to obscure the process.

*Even if the managers are not always the drivers, they are aware of the value.

Synoia , November 9, 2019 at 6:12 am

When doctors graduate from medical school with $500,000 in debt, what is the primary lesson they have learned?

[Nov 09, 2019] EU cuts economic growth forecast for 2019, 2020

Nov 09, 2019 | www.xinhuanet.com
The European Commission said on Thursday that euro area gross domestic product (GDP) is forecast to expand by 1.1 percent in 2019 and by 1.2 percent in 2020 and 2021.

Compared with the projections the European Union's executive arm published in July, the growth forecast has been downgraded by 0.1 percentage points for 2019 and 0.2 percentage points for 2020.

The European economy is in its seventh consecutive year of expansion, but the bloc now "looks to be heading towards a protracted period of more subdued growth and muted inflation," the commission said in a statement.

"The external environment has become much less supportive and uncertainty is running high. This is particularly affecting the manufacturing sector, which is also experiencing structural shifts," it said.

The commission said trade tensions between the United States and China and high levels of policy uncertainty, especially with respect to trade, have dampened investment, manufacturing and international trade.

"With global GDP growth set to remain weak, growth in Europe will depend on the strength of more domestically-oriented sectors," it said.

Vice President of the European Commission for the Euro and Social Dialogue Valdis Dombrovskis said the bloc would face "troubled waters ahead," including "a period of high uncertainty related to trade conflicts, rising geopolitical tensions, persistent weakness in the manufacturing sector and Brexit."

Top euro zone officials earlier said Germany and the Netherlands, which run budget surpluses, should invest more to help boost economic growth in their own economies and throughout the euro zone.

Dombrovskis said he "urged" all member states with high levels of public debt to pursue prudent fiscal policies and "member states that have fiscal space should use it now."

"All policy levers will need to be used to strengthen Europe's resilience and support growth," European Commissioner for Economic and Financial Affairs, Taxation and Customs Pierre Moscovici said.

[Nov 09, 2019] Exposing The Plan For A Global Dystopia

Switch to hybrids can save some fuel on personal transportation segment, but for large vehicles like delivery trucks this is problematic
Nov 09, 2019 | www.zerohedge.com

Authored by Alasdair Macleod via GoldMoney.com,

The EU sees US leadership failing while the Russian beast to its east are getting stronger. The lessons of Russia wielding power over Ukraine by cutting off energy supplies have been noted: energy security is a long-term threat to the EU and Russia is on the verge of controlling Middle Eastern supplies as well. Furthermore, the lessons of China's economic successes through non-democratic government control will also have been noted as something for European statists to emulate.

The EU's response to the energy threat from Russia has been to adopt a radical green agenda without reservation. Despite about 98% of transport and logistics being delivered by diesel and gasoline, some member states in the EU are banning the sales of internal combustion engines as motive power from as soon as 2030 . This accelerated path to zero emissions will require massive investment. Clearly this is being viewed as economically stimulative at a time of declining optimism over the general economic outlook.

These views are articulated in UNCTAD's Trade and Development Report 2019, Financing a Global Green Deal [iii]. The authors argue that internationally coordinated action between governments pursuing reflationary monetary and fiscal policies, while restricting international capital flows, will generate the economic growth and capture the resources to finance the investment. The charts below are indicative of their thinking, and are copied from Page 56 of the report.


wildbad , 1 hour ago link

Excellent laying out of the situation but little in the way of digestible solutions. Demonizing Russia as "the Beast" is both unhelpful and shows a prejudice of the author shared by the genuinely evil powers of the world. Russia has a huge interest in keeping Europe as an energy trading partner. The troubles with Ukraine were due to the US / Globalist efforts in that country to destabilize a competitor (Russia) in their global hegemonic bid.

Russia is well led and debt free. The gold backed crypto is well underway in that country but was not mentioned in this otherwise breathy article. Crypto is a bridge too far at the moment for general consumption. I am betting on a return to a fractional gold tie down. The mis-leaders and the bankers will not enjoy having their print-fest party spoiled but it is the only practical solution and carries the much desired mechanism of tying their dirty hands.

Debt is the noose which will hang the central banks and this hanging needs to be done in public whether 5% or 50% of the people understand it. Some people will only understand how the system works when Starbucks declines their cattle card.

LA_Goldbug , 25 minutes ago link

Demonizing Russia as "the Beast"

I used to be fooled into this position many Moons ago. That trick simply no longer works.

Ukraine were due to the US / Globalist

Germany did plenty to destabilize this place as well as Yugoslavia. They have gotten away from being called out on this.

PKKA , 3 hours ago link

Again pathetic assholes making plans against Russia.

It is a terrible shame: only two countries at the UN opposed Russia's resolution on the fight against Nazism.

The third committee of the UN General Assembly on social and humanitarian issues by a majority vote adopted a draft Russian resolution to combat the glorification of Nazism. Thanks to this initiative, radical groups can have big problems.

Representatives of 121 countries supported the idea of ​​Russian diplomats. As expected, only two countries voted against - the United States and Ukraine. Another 55 countries abstained from voting.


No wonder. Americans are behind any Nazism. Hitler's fascism in particular, they grew up in the hope of inciting Hitler to the USSR. Well, Ukro-Nazis today are the favorite Nazi whores of Americans. Therefore, such results: the owner and his whore.

As Nikita Khrushchev said, we did not finish you off near Stalingrad, but we will finish you off!

[Nov 09, 2019] This should put the kobosh in Warren saying she is a progressive

Nov 09, 2019 | caucus99percent.com

snoopydawg on Thu, 11/07/2019 - 9:25pm

Bain Capital was co-founded by Mitt Romney.

Deval Patrick is a Managing Director.

Elizabeth Warren wants Patrick in her administration. @EmmaVigeland @atrios @NomikiKonst @_michaelbrooks @BernieBroStar

-- Eric J - #Bernie2020 (@EricJafMN) November 8, 2019

Deval Patrick served on the board at subprime mortgage giant Ameriquest. Melody Barnes is on the board at bigwig defense contractor Booz Allen Hamilton. Textbook cases of the revolving door corruption Warren frequently attacks. https://t.co/KU3Ct3j9eC

-- Zach Carter (@zachdcarter) November 8, 2019

If she really cared about the policies she is running on she would have endorsed Bernie. Period. It was during the primary that Hillary said, "single payer will never ever happen here."

Bernie was running on it and yet Warren did not endorse him for it. If she actually wants to help us she would drop out and tell people to vote for Bernie. Sure everyone has the right to run for president, but we know or believe that she is only running to keep Bernie from becoming president.

She is lying to us about not taking money from rich people and corporations because she took their money for her senate campaign and transferred it to her presidential campaign. If she isn't up front about this then how can we trust her on anything else?

Chuck Todd is such a tool

My jaw is on the floor.

Elites eliting about elites while elitseplaining to working Americans about how they are going to vote for some elites and beat the Republicans elite. https://t.co/l0W8QPUT0E

-- Nomiki Konst(@NomikiKonst) November 8, 2019

"Who is to the left of Bloomberg on guns and climate change?" Hmm let me think...of course it's not Biden. Nor Harris...Kilobits.... Buttigieg or even Warren. Doh!

[Nov 09, 2019] Warren called herself a teacher, really pushed her teacher history, and asked "Are there any teachers in the crowd", etc etc. It was so fake and pandering. I wanted to barf.

Nov 09, 2019 | www.nakedcapitalism.com

petal , November 8, 2019 at 2:29 pm

Warren did that(what Alex Thompson tweeted about) at her town hall here. Called herself a teacher, really pushed her teacher history, and asked "Are there any teachers in the crowd", etc etc. It was so fake and pandering. I wanted to barf. Do people really fall for this stuff? The folksy garbage was poured on mighty thick. I was sitting there thinking "Come on, lady-you've been a professor at the highest profile law school in the country for how long now?"

Lambert Strether Post author , November 8, 2019 at 2:33 pm

> The folksy garbage was poured on mighty thick.

Lime green Jello with marshmallows. That's the sort of thing I think of. Food I'd avoid at a church basement supper if at all possible.

petal , November 8, 2019 at 2:49 pm

Yep.
It's funny-I spent 10 years at Harvard, and I lived near The Yard and the law school. I knew a lot of faculty at H, and was privy to a lot of the politics that went on. My bs detector was honed there. At the town hall, I could see right through her. It was all so familiar. Don't underestimate the cunning and doublespeak. What is that quote-"When someone shows you who they are, believe them"?

Pavel , November 8, 2019 at 3:58 pm

Why didn't she proclaim her great groundbreaking achievement of being Harvard's "first woman of color" professorial appointment? Isn't she proud of that any more?

Dog, that woman seems to be in a race to seem the least authentic. Can't her staff tell her to act natural?

After I post this comment, I'm gonna get me a beer.

Phillip Allen , November 8, 2019 at 8:16 pm

"Can't her staff tell her to act natural?"

Why assume that what we see isn't her natural self, such as it is? Or, rather, that there's anything more genuinely human underneath the pandering, opportunistic surface? As Petal cited above, "When someone shows you who they are, believe them."

[Nov 09, 2019] Are You Calling Me Stupid Gabbard Rips Joy Behar's 'Useful Idiot' Smear On The View

Notable quotes:
"... Journalist Glenn Greenwald summarized the testy exchange as Gabbard "responding with righteous rage but also great dignity to the disgusting smears of Democrats about her patriotism and loyalty." ..."
"... What a woman! Get Trump out and give the POTUS to Tulsi. Wonderful. I will definitely contribute to her campaign. ..."
"... What's funny about the whole thing is that the 'regular viewers' of the view are some of the most programmable 'useless' idiots that this (excuse for a country) has ever seen.... ..."
"... The View -- owned by Disney. Openly misandrist show -- in the shows more than 2 decades, having gone through dozens of hosts, the show has never had a male host. How's that for "inclusivity"? ..."
Nov 08, 2019 | www.zerohedge.com

Democratic presidential candidate and Hawaii congresswoman Tulsi Gabbard faced the increasingly nasty smears branding her a Russian asset and "traitor" head on during The View on Wednesday, following the recent spat with Hillary Clinton who suggested the Kremlin was "grooming" Gabbard to be a third-party candidate .

"Some of you have accused me of being a traitor to my country, a Russian asset, a Trojan horse, or a useful idiot I think was the term that you used," Gabbard told the panel, after in prior episodes Joy Behar especially had agreed with and aggressively amplified Hillary's baseless claims. The panel had also previously called her a Trojan horse. Gabbard came out swinging in her remarks: "It's offensive to me as a soldier, as an American, as a member of Congress, as a veteran, and frankly as a woman, to be so demeaned in such a way."

"Well, useful," Behar said, referencing her previously labeling the Iraq war veteran Moscow's 'useful idiot'. "But that's a Russian term, they use that," she added. "Are You Calling Me Stupid?" Gabbard at one point angrily shoots back. And demonstrating just how low and idiotic, and without substantive argument the "controversy" around Gabbard has become, Behar at one point even offers as 'evidence' of the presidential candidate's supposed Russian ties that she's appeared on FOX's Tucker Carlson Tonight on multiple occasions.

"I am a strong and intelligent woman of color, who has dedicated almost all of my adult life to protecting the safety, security & liberty of Americans," Gabbard fired back.

She also schooled the panel on her distinguished military career and slammed Behar's likening her to Putin's "useful idiot" -- explaining also that she joined the Army after the 9/11 attacks but that her country lied to her in invading Iraq.

"You are implying that I am too stupid, and too naive, and lack the intelligence to know what I am doing," she further counter-attacked Behar with.

The full segment from Wednesday's The View appearance is below, with the fight over Behar's "useful idiot" remarks beginning at the 1-min mark:

https://www.youtube.com/embed/-Y8ayIpjPvY

One astounding moment came when Gabbard reiterated her position that Hillary Clinton is a "warmonger," at which point Behar actually asked, "What's your evidence of that?"

A perplexed Gabbard immediately shot back, "Are you serious?"

Journalist Glenn Greenwald summarized the testy exchange as Gabbard "responding with righteous rage but also great dignity to the disgusting smears of Democrats about her patriotism and loyalty."


haruspicio , 45 minutes ago link

What a woman! Get Trump out and give the POTUS to Tulsi. Wonderful. I will definitely contribute to her campaign.

BTW who is that ******* harridan to her left, the ugly one cutting her off all the time? What a ******* bitch.

Bubba Rum Das , 2 hours ago link

What's funny about the whole thing is that the 'regular viewers' of the view are some of the most programmable 'useless' idiots that this (excuse for a country) has ever seen....

wakeupscreaming , 2 hours ago link

The View -- owned by Disney. Openly misandrist show -- in the shows more than 2 decades, having gone through dozens of hosts, the show has never had a male host. How's that for "inclusivity"?

Next time you take the kids to the movies or to a themepark, think twice about patronizing Disney.

keep the bastards honest , 1 hour ago link

Stay away, they are perverts, keep your kids away from their media and products.

Petkattash , 4 hours ago link

She was clear and confident in her remarks. Still don't care for many of her policies but she is was better that the rest of the D bunch.

iSage , 7 hours ago link

I am fearful the Republic for which We Stand, is falling, right before our eyes. I guess we disengaged at some point, sad. We are all Americans, what happened to the common ground? It is disappearing...

Bobzilla. Do not piss him off , 7 hours ago link

Joy Behar is a so fugly. She's a loudmouth ******, who is even uglier than the fat negress with the stupid looking blonde dregs. ****, what a hideous show. Anyone who watches that POS show is a ******* low IQ moron .

[Nov 09, 2019] Biden's ode to Centrism

This is not an ode that's a requiem...
Nov 09, 2019 | www.nakedcapitalism.com

XXYY , November 8, 2019 at 3:44 pm

Biden's ode to Centrism is great.

But at another level these kinds of attacks are a serious problem. They reflect an angry unyielding viewpoint that has crept into our politics. If someone doesn't agree with you -- it's not just that you disagree -- that person must be a coward or corrupt or a small thinker.

It's representative of an elitism that working and middle class people do not share: "We know best; you know nothing". "If you were only as smart as I am you would agree with me."

This is no way to get anything done. This is no way to bring the country together. This is no way for this party to beat Donald Trump.

This is from the party that has spent the last three years vilifying both Donald Trump and Bernie Sanders in every possible mean, vicious way? Evidently Joe is only in favor of "bringing the country together" if leads to the victory of his particular faction, not as, you know, and actual thing.

chuckster , November 8, 2019 at 5:04 pm

He also believes that the Republicans in Congress will work with him when he wins next year. Apparently he intends to give away more than Obama did to get their cooperation .

Grand Bargain Part 2

[Nov 09, 2019] Another humiliating blow to Latin-American neoliberalism

Nov 09, 2019 | www.moonofalabama.org

vk , Nov 8 2019 19:41 utc | 24

Another humiliating blow to Latin-American neoliberalism:

Boicote de 'supermajors' funciona, e governo vai mudar regime de leilão

Bolsonaro's government tried to auction Brazil's remaining unexplored (but already mapped, so it's certain there's oil there) presalt lots. The expectation was to raise some R$ 109 billion, but it only rose R$ 69 billion. To make things even worse, half of those came from the Brazilian State-owned oil company itself, Petrobras.

There's strong evidence this fiasco came from the international oil cartel; they think they can get the presalt oil for a (much) better price:

Chevron, Exxon, BP, Total e Repsol já tinham anunciado 'boicote' ao leilão

The pressure seems to be working. The government has already stated it will do another auction, this time with "changed rules", in order to "estimulate competition between the interested companies".

Another similar episode had already happened during usurper Brazilian president Michel Temer, when, in 2017, he tried to privatize the country's State-owned electricity company (Eletrobras). The auction was "desert" (i.e. no bids).

Why is this happening?

The problem with today's neoliberals is that the capitalist world is completely different from the one of the end of the 1980s and 1990s. In that era, there was excess liquidity from the First World countries -- specially USA and Japan pension funds -- which was purchasing fabulous profit rates in order to stay competitive in the recently-privatized world (pension funds in the USA had to profit at least 7% from each investment in their portfolio to reach ends meet in 2006, according to Dumenil & Levy).

After 2008, there was a crisis followed by a depression characterized by a credit crunch. Reverse stagflation happened (and still happens), where unemployment fell but inflation continued to fall. To put it simply, there's no more foreign money for Latin American neoliberal dictators to grab through the simple liquidation of public assets anymore -- at least not nearly enough to reach fiscal equilibrium (see Argentina for the more spectacular example).

So, yes, there was a cartel arranging for the presalt reserves failure, but this cartel only had to do what it did because -- you're already tired to read it from me -- the profit rates in the capitalist world are secularly falling . Were the profit rates high, the cartel would've already bought the presalt whatever the conditions. They are only bargaining with the already very submissive Brazilian government because they need to: presalt reserves, albeit abundant in good oil, require a unique and pretty advanced technology which was developed by Petrobras. If they invest, profit rate will fall even further, so they must get the oil, but free of investment (after the 2016 coup, they got their hands on the platforms -- but only those who were already installed by Petrobras).

That's also the reason the USA-backed New Silk Road will fail: Western capital won't invest in SE Asia because that would mean money spent to infrastructure (i.e. invesment), and that would erode their profit rates even more. And, sincerely, why would they? They had 70 years to invest there, and 100 years before that (during the colonial times), to do it. Why will they do now, when they are much weaker?


karlof1 , Nov 8 2019 20:49 utc | 30

!!Great news!!

Brazil's Supreme Court rules Lula must be released from prison ASAP. But, will this decision meet the criteria he set to accept being released? I checked Pepe Escobar's Facebook but he's not written anything there for 7 hours. I asked him the same question.

Vasco da Gama , Nov 8 2019 21:25 utc | 33
karlof1@30

Right now, Lula is speaking to the people and his supporters in the street outside Curitiba prison, and already in freedom.

To clarify on the Court's ruling: the decision says that the accused, with processes which have not exhausted all appealings, therefore have not yet been ultimately condemned, may not be kept in prison. A previous judgement allowed for this to happen if there had been a reversal of judgement along the court instances of the process ( LavaJato - corruption process ). It should be added that this is not exclusive to Lula, eight other accused, including one Lula's minister may be freed pending appropriate legal petition from defense, and any other current prisoner under similar circumstances in Brazil's justice system.

The Supreme Court only re-established the Constitutional order, following on the petitions to constitutional review by legal council association and the communist party.

Keep in mind that Lula is still under several accusations and may not while these processes are not finished to present himself for political offices.

karlof1 , Nov 8 2019 22:00 utc | 34
Vasco da Gama @33--

Thanks for your reply! I was about to answer my own question that Lula agreed to be let out. As I understand the situation, Lula still has to battle in court to keep his freedom; and he might also be targeted for elimination given the murderous nature of those associated with Bolsonaro. As Lula said upon release, they tried to imprison an idea by imprisoning a man; ideas cannot be imprisoned. For me, it's an excellent birthday gift!

Lcchearn @32--

Yes, I've contemplated starting my own blog, but most platforms are owned or affiliated in some manner with Google, so I stopped looking. I know non-affiliated hosts exist and will likely resume looking upon the turn of the year. I agree about writing longer essays as there are a few topics I'm into that demand expansion. I've been and continue to be impressed with Caitlin Johnstone's success as well as with other younger idealistic, truth-seeking journalists like those inhabiting The Grayzone . In fact, given its content, Grayzone's one site I'll ask who hosts them. Thanks very much for your interest and the support that goes with it!

Vasco da Gama , Nov 8 2019 22:23 utc | 35
karlof1, I'll drink to that too. Keep the good spirits and health. Cheers!

Bolsonaro, and their supporters are dwindling, the initial success of anti-social media platforms was only that: initial, sufficient to swindle brasilean people in the election alone. This had all the hallmarks of a Cambridge Analytica type campaign, which if not sustained serves only to expose the maracutaia (fraud) before everyone. I think the signs are getting positive, even the media, quite condescending during the campaign now take hard jabs at Bolsonaro and his quadrilha (gang).

[Nov 09, 2019] Under neoliberalism Democracy is about equality of money ? Under neoliberalism the rule of law means maintianing social position of upper classes vs majority of population, which is moral imbecility. Unjust laws do not make for justice.

Nov 09, 2019 | crookedtimber.org

steven t johnson 11.08.19 at 4:36 pm 77

More directly on topic, the difficulties in defining neoliberalism usefully I think come from 1) an incoherent political spectrum centered on overly specific policies which will vary according to time and place and the vicissitudes of world economy and war, rather than on class 2) the lack of a sound analysis of what bourgeois democracy is 3) an economic analysis that omits economic history, leaving most of the discussion decontextualized.

1) Basically, the liberal state, the neoliberal state and a host of other variants share the view of freedom as the right to buy what you can afford, to sell what you own and to do whatever you want in the meantime. It is a vision centered on property as the essence of humanity. See Benjamin Constant. And this is true even for people who try to imagine a non-market sphere for other aspects of life. The most common form today is perhaps the notion of the family as a private haven, the center of civil (as opposed to political) society. But nobody escapes reality, this is purely ideological, an illusionary escape from class society. The more the family is a private haven, the more it is a private prison.

The problem with placing neoliberalism on a spectrum is that practically everyone whose opinion would be accepted as legitimate for expression, fundamentally shares this vision. Disagreements about the inevitable lapses from the ideal are inevitable, but will change. In the earliest days of capitalism, expropriating Church lands was liberalism, even if the Wars of Religion, the Dutch revolution and the English reformation are conveniently omitted as essential. A continental power like France or Russia needed more intervention in its economy to create a military than England or Japan. The superficial differences confuse how much overlap there is between neoliberalism and every other acceptable school.

2) Possession of property of course puts people in different places in social life. Neoliberalism and the old liberalism alike held that freedom and justice were a balance of classes, that the state would maintain. How interventionist the state must be, again would vary. But the legitimacy of any intervention is held to be based not just on whether it was meant to maintain the proper balance of classes, but upon whether it was done with consent.

Today the usual phrase is the rule of law. But this is a claim the means justify the ends, which is moral imbecility. Unjust laws do not make for justice.

The real justification for the rule of law is as an ends in itself, as social order no matter what, where class freedoms are safe. The overlap between this commitment from neoliberalism and other arrangements should be obvious, not confusing, but it is what is is. Democracy is about equality of money. In political terms, the spectrum of capitalist forms of the political regime, runs from the libertarian/neoliberal ideal on the left (there is a reason libertarians reprint Constant and Mill, even Sidney!) to fascism on the right.

Fascism is an essential alternative weapon in the greater struggle, where individuals sacrifice for the power of the nation, which means the ruling classes of the nation, in substance though not in person. The tolerable version of social democracy lie somewhere in the center, putting class collaboration and corporate freedom above the purest visions of freedom, which would be preposterous universe of small business owners and farmers and professionals. But the notion democracy means human rights is purely ideological, refuted by history. It means citizen rights, because, the rules are all.

3) The novel issues that provoked the emergence of a neoliberalism distinct from the other political philosophies are as much a product of economic history (change!) as the disappearance Court vs. Country as the axis of politics in England. I suggest that, while Slobodian may be correct that the loss of empire was hugely important to a group who devised some justifications for neoliberalism, in practice, the decline, then disappearance of the gold standard, the increasing importance of finance, the US hegemony over the world, the commitment to reversing the Great Compression, to restoring a more just balance (as they see it,) between capital and labor were important. In US domestic politics, the secular stagnation in real wages, despite the increased labor as wives entered the labor force, were the point. And it is by no means clear that there are any significant forces opposing this.

[Nov 09, 2019] Around the world there are massive protests against neo-liberal policies and imperialism. In many of them the CIA and MI6 are fishing in troubled waters, as they always do and attempting to divert popular anger against corrupt capitalists into sectarian disputes

Notable quotes:
"... As to Brazil the right is in power there because the Workers Party was, first, driven from office by a capitalist plot and its candidate for the Presidency, Lula, imprisoned on totally phony charges and prevented from running. Had Lula run he would have won, easily. Then there is Chile where the post Pinochet settlement is maintained by military force, backed by imperialists. Peru would vote for socialists too if it were given the chance as would Guatemala. Mexico just did. ..."
"... That, after all is what they did in Ukraine, where the first move of the coup government was to ban opposition socialist parties. A free election in Ukraine would deliver a left wing government. ..."
"... Anyway let us see: the election of a socialist government will be the first step in the building of a totally new society organised not for individual profit but for humanity as a whole. It won't come easily but the tendency towards it is as natural to society as the desire to live is to the individual. Underneath everything else-the propaganda, the ideology, the terrorism, fear and ignorance-we are all, everywhere, inspired by the same longing for justice, equality and fair treatment and that is almost always the underlying theme in every election. ..."
"... Right now there is a very important election taking place in the UK where, against massive opposition from capitalists and leading a party riven with corrupted, treacherous Fifth Columnists, Jeremy Corbyn is putting forward a political platform which could re-invigorate the left internationally. ..."
Nov 09, 2019 | www.moonofalabama.org

bevin , Nov 8 2019 18:29 utc | 12

"Right wingers and fascists are winning more and more each time there's a vote..." Just Me@3

Maybe it is just you: in Argentine and Uruguay the fascists and other right wingers just lost elections. As they did in Bolivia. If there was an election in Ecuador the left would easily win, in fact it won last time and would still be in power were it not that Moreno, who his Dad named Lenin, turned coat as soon as his left wing campaign had yielded him the victory. In Colombia fair elections are very rare-basically left wing candidates are killed, if not before, then after the election- but the left appears to have won most of the recent provincial elections.
In Honduras the last election was a landslide victory for the left, until the voting was stopped and the election stolen. In Haiti Aristide would win except that he is prevented from running and kidnapped if he wins. The current US/OAS backed President would not last half an hour without the muscle, from Canada et al, that keeps him in power while the people call for the return of the $2billion that he and his predecessor-chosen by the Clinton Crime family- stole.

As to Brazil the right is in power there because the Workers Party was, first, driven from office by a capitalist plot and its candidate for the Presidency, Lula, imprisoned on totally phony charges and prevented from running. Had Lula run he would have won, easily. Then there is Chile where the post Pinochet settlement is maintained by military force, backed by imperialists. Peru would vote for socialists too if it were given the chance as would Guatemala. Mexico just did.

And that is just one continent -- the one most amenable to imperialist power, and closest to being under the thumb of its death squads and torturers.

Around the world there are massive protests against neo-liberal policies and imperialism. In many of them the CIA and MI6 are fishing in troubled waters, as they always do and attempting to divert popular anger against corrupt capitalists into sectarian disputes. That, after all is what they did in Ukraine, where the first move of the coup government was to ban opposition socialist parties. A free election in Ukraine would deliver a left wing government.

Look closer at Germany and you will see that the AfD are simply taking advantage of circumstances that the left has refused to face honestly. The same is true in Hungary and Poland where it has been the traditionalist, semi fascist clerical right wing parties which have dared to challenge the neo-liberalism which the 'left' has promoted and protected. The right wins in Europe by default, when the left refuses to follow its principles (Hello M Hollande Blairite President that was of France!) and often that is because the left parties have been colonised, systematically, by imperialist forces.

Anyway let us see: the election of a socialist government will be the first step in the building of a totally new society organised not for individual profit but for humanity as a whole. It won't come easily but the tendency towards it is as natural to society as the desire to live is to the individual. Underneath everything else-the propaganda, the ideology, the terrorism, fear and ignorance-we are all, everywhere, inspired by the same longing for justice, equality and fair treatment and that is almost always the underlying theme in every election.

Right now there is a very important election taking place in the UK where, against massive opposition from capitalists and leading a party riven with corrupted, treacherous Fifth Columnists, Jeremy Corbyn is putting forward a political platform which could re-invigorate the left internationally.

[Nov 09, 2019] Obama and Muslim Brotherhood

Nov 09, 2019 | www.zerohedge.com

fersur , 1 hour ago link

Unedited !

America is fighting terrorism and the White House is hosting it

Walid Sharabi and Gamal Hishmat , Muslim Brotherhood leaders, wanted for justice for participating in killing and inciting on terror attacks in Egypt, escaped from the country and they are hosted by Qatar, Turkey and moving freely in Europe and the USA.

They are wanted for participating and inciting on burning vital buildings and public properties, inciting for violence and killing, criminal court cases numbers 12838 year 2013 , and 10790/101 year 2013 .

Muslim Brotherhood leaders attended meetings with senior US officials and Congress in this current month Jan 2015. Walid Sharabi declared on his Face book page, that Mohamed Morsi being the legitimate president of Egypt, is not an open issue for discussion or arguments. He added that this is not the first time and won't be the last time to held meetings with US officials and also they are in contact and meetings with 27 other countries in the world to discuss Egyptian affairs issues.

MUSLIM BROTHERHOOD LEADERS IN THE US CONGRESS MUSLIM BROTHERHOOD LEADERS ESCAPED FROM EGYPT AND WANTED FOR JUSTICE FOR PARTICIPATING AND INCITING ON TERROR ATTACKS

Muslim Brotherhood leaders in the above screenshot are the leaders of the revolutionary council formed and established by Muslim brotherhood in Turkey after the 30/6/2013 revolution. The woman is Maha Azzam the chief of the council, Walid Sharabi and Gamal Hishmat Shura council member of Muslim Brotherhood and Abd Elmawgoud Aldardiri the official spokesman of Muslim Brotherhood and their dissolved political party, after being declared a "terrorist organization" in Egypt.

Despite that the US refused to consider Muslim Brotherhood as "terrorist organization", and that the US doesn't hide publicly their ties with Muslim Brotherhood, but we do have many questions and exclamations here. What is the purpose of these meetings? Is it to hold the stick from the middle?!

There is a blatant contradictory in the White house policy , The White house claims their support for stability and fighting terrorism in Egypt, and in the meantime time, they support and held meetings with the same terrorists, Egypt is fighting!

There is no official declarations from the US officials or the Brotherhood about the details of discussions of these meetings between MB and US officials. If Washington follows the transparency policy as they always claim, why these meetings details were not published to the public opinion!?

There is certainly a message there to Egypt from the US and their Muslim Brotherhood allies, and If there is any honesty or transparency in the White house policy, Obama should declare and admit publicly that they held deals with the devil and the terrorists, as long as it serve their interests, and they have no shame in applying double standards policy. This is happening already, so why not call spade a spade!

Does the White house think that playing with this idiotic card of Muslim Brotherhood, can put any pressure on Egypt, when needed, or to go on with the same chaos middle East project, that Egypt was saved from, after the 30/6 Egyptian revolution, to face the same destiny of Syria, Libya, Iraq and Yemen, so the project will be accomplished and achieve its targets!

Is it a coincidence or intentional to allow the first political party of a terrorist organization like the Muslim Brotherhood in the USA, and held official meetings with them what is the deal here?

On 26 Jan 2015, the inquisitr's Website published that Muslim Brotherhood Starts A Political Party "UMMA" out of Chicago. The founder of the party is Sabri Samirah a Jordanian Muslim Brotherhood member, was deemed a US national security risk in 2003 and was banned from entering the US for almost 11 years.

SABRI SAMIRAH ALLOWED TO ENTER THE US BY OBAMA IN 2014 AFTER 11 YEARS OF BAN FOR NATIONAL SECURITY THREAT

Sabri Samirah, was allowed into the U.S. by President Barack Obama back in 2014 following an 11-year ban!!! He immediately gathered Muslims to form the party, which is now recognized as the UMMA, an offset of the United Muslim Americans Association (UMAA means nation). The first political party in the U.S. to be openly connected to the Muslim Brotherhood terrorist organization .

So, not only the White House refused to consider Muslim Brotherhood as terrorist organization, but they allowed them to form a political party in the US There are some political analysis that are confirming the ties between MB and Washington, to keep the channels open between the US and terrorist Organizations through the mediation of Muslim Brotherhood, like Al-Qaeda and ISIS to ease the pressure on the US in their fight against terrorism!

What is the deal Obama?!

This is not the first time and it won't be the last time either, the White House make deals with all parties, including terrorists, this is no longer a secret and it is not shocking anymore.

But why not call things by its own names? Obama always talks about his administration's principles and values and standard policy and he is always lecturing us about the US transparency in dealing whether with internal or external affairs. But he never calls things by its right names!

The Muslim Brotherhood who deceived the entire world and many Egyptians, with their moderate Islam and that they only seek to be political partners with other political currents, are the same Muslim Brotherhood who ruled Egypt with fascism and the same who live in about 80 countries in the world, including the US, they are the same MB who consider women as nothing but a pot of desires and lusts

They are the same brotherhood who burned churches , killed Christians , tortured and killed Egyptian citizens and burned private and public properties , they are the same Brotherhood who are loyal to ISIS and raising their flags of slaughtering and terrorism in Egypt.

This is their tactics, they are spreading through deception, and when the right moment comes, they show their ugly faces and raise their swords against any one who doesn't belong to their sick distorted ideology.

This is no longer a prediction or analysis, this is no longer a reading of the scene. We repeat and we will never gave up confirming and warning the entire world that Muslim Brotherhood is a terrorist organization, because this is what we have lived and experienced when Egypt was under the rule of Muslim Brotherhood, and we are still fighting their terror attacks.

Obama, you can't support the Egyptian people and support the terrorists at the same time, unless of course, you are a MORON or a Schizophrenic!

Obama said that the US will always support the Egyptian people's will and the Egyptians are the only ones to chose freely their own future and destiny

We did chose freely our destiny and future, like UNCLE OBAMA said, by our own free will on 30/6/2013.

We revolted against Muslim Brotherhood fascist regime and got back our identity and country that has been hijacked by Muslim Brotherhood terrorists.

Obama can't claim that the US respect our human rights and free choices, the Obama's administration violated one of our main human rights when they interfered in our internal affairs from the very first beginning, and every time they are dictating and lecturing us about what must be done to enjoy freedom and democracy.

Obama is against violence and armed demonstrations, this is what he claims He mentioned several times that those who demonstrate can not express themselves with violence!? Not even with bombs or machine guns! How come Obama is telling our gevernment to apply Restraint policy , while they are facing Muslim Brotherhood armed demonstrations and terror attacks?!

Yes, "He can" support us and support the terrorists at the same time.

Obama, you can't claim that you are with us and you are fighting terrorism, and at the same time, you are hosting Terrorists in the heart of America!

All of these flags, logos and names vary, but The terrorism is one. they symbolize the blood, racism and extremism, intolerance and discrimination, murder and slaughter and bloodshed and torture.

How come Obama supports the symbol of Muslim Brotherhood which is a symbol of terrorism, violence and blood, and he is fighting ISIS and Al-Qaeda? They are all coming from the same bloody womb! How come America declared HAMAS as terrorist group, and in the meantime, the white house is supporting Muslim brothers terrorists and Hamas is the military wing of MB!

Muslim Brotherhood raising their 4 fingers sign of terrorism and blood in the US congress and US foreign affairs department, it is not a message of challenging the Egyptian State or the Egyptian people, but Muslim Brotherhood are directly challenging the American people.

This is totally insane and beyond any logic for any brain to absorb or even to understand.

[Nov 09, 2019] Three Deep State Confessions On Syria by Brad Hoff

At a US gov-funded think tank, this official who oversaw Congress' Syria Study Group outlines the continued regime-change strategy. She says the US military "owned" 1/3rd of Syrian territory, including its oil/wheat-rich region. And the US is trying to block reconstruction funds: 1191808201177604096
Notable quotes:
"... Trump is a total moron, but we owe him a great debt for bringing the Deep State out into the open. We also owe him a great debt for blatantly stealing Syria's oil. Trump's big problem is that he's too stupid to keep the secrets of the ruling-class. They will never again be able to deny the Deep State. And their "just" wars are all exactly what they always looked like: unadulterated criminal greed. It's just killing and stealing, no different from any other murderous, thieving criminal other than the massive scale of the killing and stealing. ..."
Nov 08, 2019 | www.zerohedge.com

Authored by Brad Hoff via The Libertarian Institute,

First, all the way back in 2005 -- more than a half decade before the war began -- CNN's Christiane Amanpour told Assad to his face that regime change is coming . Thankfully this was in a televised and archived interview, now for posterity to behold.

Amanpour, it must be remembered, was married to former US Assistant Secretary of State James Rubin (until 2018), who further advised both President Obama and former Secretary of State Hillary Clinton.

"Mr. President you know the rhetoric of regime change is headed towards you from the United States... They're granting visas and visits to Syrian opposition politicians," Amanpour told Assad in a 2005 CNN interview .

Next, a surprisingly blunt assessment of where Washington currently stands after eight years of the failed push to oust Assad and influence the final outcome of the war, from the very man who was among the early architects of America's covert "arm the jihadists to topple the dictator" campaign .

Myself and others long ago documented how former Ambassador to Syria Robert Ford worked with and funded a Free Syrian Army commander who led ISIS suicide bombers into the battlefield in 2013.

Amb. Ford has since admitted this much (that US proxy 'rebels' and ISIS worked together in the early years of the war), and now admits defeat in the below recent interview as perhaps a reborn 'realist'.

And finally, not everyone is as pessimistic on the continuing prospects for yet more US-led regime change future efforts as Robert Ford is above. Below is an astoundingly blunt articulation of the next disturbing phase of US efforts in Syria , from an October 31 conference at the Center for Strategic and International Studies (CSIS) .

"The panel featured the two co-chairs of the Syria Study Group , a bi-partisan working group appointed by Congress to draft a new US war plan for Syria," The Grayzone's Ben Norton wrote of the below clip:

She made it a point to stress that this sovereign Syrian land "owned" by Washington also happened to be "resource-rich," the "economic powerhouse of Syria, so where the hydrocarbons are as well as the agricultural powerhouse."

With images now circulating of Trump's "secure the oil" policy in effect, which has served to at least force pro-interventionist warmongers to drop all high-minded humanitarian notions of "democracy promotion" and "freedom" and R2P doctrine as descriptive of US motives in Syria, the above blunt admissions of Dana Stroul , the Democratic co-chair of the Syria Study Group, are ghastly and chilling in terms of what's next for the suffering population of Syria.

We are "preventing reconstruction aid and technical expertise from going back into Syria," she stressed in her statement.

America is not finished, apparently, and it's likely to get a lot uglier than merely seizing the oil.


Generation O , 1 hour ago link

Hell, why doesn't America unleash nerve gas on Syria's population and get this shat-show over with? Naturally, this will result in the loss to the international body parts market of Syria's youngsters (videos of actual procedures upon screaming school-age kids are available online), but America's shockingly-enabled Child Protective Services seems quite adept at replacing that market sector.

Blue Boat , 1 hour ago link

General Wesley Clarke revealed it all in 2007. He's been banished from the TV pundit shows ever since.

If you haven't seen this, it's 2 min. Watch: https://www.youtube.com/watch?v=gTbg11pCwOc

jeff montanye , 1 hour ago link

"They're granting visas and visits to Syrian opposition politicians"

think there were any quid pro quos with those? of course that was ok; it only led to a million dead in the mideast for the very short term advantage of the likud mossad, for which anything, at all, from 9-11 to epstein, is permitted

jeff montanye , 1 hour ago link

zionist but yes. note rubin worked both sides of the street like victoria nuland.

also the lovely lady in the video is dana sproul, https://www.google.com/search?client=safari&rls=en&q=dana+stroul+zionist+***&ie=UTF-8&oe=UTF-8

Conscious Reviver , 1 hour ago link

The Dogs of War live in Occupied DC.

Aleedsfella , 2 hours ago link

Gooooooooo Russia! NATO are great at bombing farmers but they **** their panties when another modern army drew a line in the sand and they retreated and dug in around the oil fields.

That sounds very anti USA and it is! But I know the British are involved, I just do not see the British Armed Forces as the British Armed Forces anymore they are just small players in a USA fronted globalist force and this globalist force fights for the private wealth of a few individuals?

**** that and **** you for your service to all NATO personnel since 9/11. Our armed forces are the bad guys in this movie. Which oil/ore rich nation without a western run central bank are NATO forces going to free the **** out of next? I was betting on Iran but it looks like America is about to turn on South America soon, Venezuela looks like NATO want to free it.

East Indian , 2 hours ago link

Christiane Amanpour - I wonder what she sees when she sees herself in the mirror.

'To die, to sleep – to sleep – perchance to dream: ay, there's the rub, for in that sleep of death what dreams may come when we have shuffled off this mortal coil, must give us pause.'

Good luck, Amanpour.

BobEore , 2 hours ago link

Put down that crak pipe ho! \

likely to get a lot uglier than merely seizing the oil

Lost in their factionalist partisan bubble of rabid political gamesmanship, Merikans continue to squabble over which of their talmudic puppet parties suffer more from imperial over reach...

whilst serious war crimes committed by jihadis and their neo-islamist backers continue to occur as a result of the WAR CRIMINAL IN CHIEFS' kowtowing to an oriental despot who has the goods on Donnies' Debt Deal with turco-talmudic bagmen who did over his dirty real estate laundry in return for having their own 'special genius' POTUS dancing on their strings!

Hundreds of thousands displaced, and more now on the run from rape n pillage gangsters due to Dons' Deceitful Sellout of the ONLY group who took on the Daesh/ISIS and pounded their pouty asses in to the desert sands. All to save his own chicken neck; And you wanna talk about oil?

"I like oil - we're keeping the oil." OIL FOR BLOOD - BLOODY DON DRIMPF, THE JIHADIST CHEW TOY!

Condor_0000 , 2 hours ago link

Trump is a total moron, but we owe him a great debt for bringing the Deep State out into the open. We also owe him a great debt for blatantly stealing Syria's oil. Trump's big problem is that he's too stupid to keep the secrets of the ruling-class. They will never again be able to deny the Deep State. And their "just" wars are all exactly what they always looked like: unadulterated criminal greed. It's just killing and stealing, no different from any other murderous, thieving criminal other than the massive scale of the killing and stealing.

ImTalkinfullCs , 2 hours ago link

This twat wants to "hold the line on preventing reconstruction aid from going back to Syria" ........ the Zionists love a failed state. Music to their creepy ears.

DEDA CVETKO , 2 hours ago link

Syria is the last barrier that separates the civilization from the tsunami of evil. The Syrian sovereignty and independence - however flawed - must be preserved at any cost.

Anglo-Aryan , 2 hours ago link

Jews responsible for the whole of it. America cannot become a decent force in the world without deposing its Jewish elite and removing their power, reach and influence.

pHObuk0wrEHob71Suwr2 , 2 hours ago link

https://vault.fbi.gov/victor-marchetti/victor-marchetti-part-01-of-01/view

DEDA CVETKO , 1 hour ago link

I lived under communism for 21 years. For the first 11 or so years, we only had one TV channel, which was kinda 50/50: fifty percent government propaganda, fifty percent government-approved forms of entertainment. Some 11 years later, we got another channel, which was mostly movies and assorted entertainment, with bits and pieces of Big Brother presence tossed in for good measure.

Still, I found the official news credible in one sense: you knew that these guys were full of **** and lying through the teeth so you could always reconstruct the truth by placing their news coverage on its head. It never failed. It worked like a charm.

Now, I have some 600+ channels worth of pure brainwash in every shape, shade and nuance of mind control. It is impossible to even think of reconstituting some semblance of objective reality from the fake media coverage. All you get is one gigantic funhouse, the house of horrors, the lunatic asylum on steroids. The only way to stay sane is to steer clear and as far away from the insanity as possible. You did the right thing, in fact the only possible thing.

Seek Shelter , 2 hours ago link

The Washington Institute -- founded by Barbi Weinberg and first led by the former deputy director of research for AIPAC. Democrat, Republican--all the same to these 'think tanks'.

[Nov 09, 2019] What old age does to people: Biden who fought for financial oligachy and insurance companies now thinks that he fought for the Democratic Party his whole carrer. Ohh wait, may be he did fount for Clinton Neoliberals Party who hijacked the old Demosctic Party

Nov 09, 2019 | www.nakedcapitalism.com

The Rev Kev , November 8, 2019 at 6:52 pm

"I Have Fought for the Democratic Party My Whole Career"

And when Biden said that, he chose the truth and not the facts, to paraphrase him.

MyLessThanPrimeBeef , November 8, 2019 at 7:13 pm

Maybe like Hillary, he distinguishes public vs. private statements.

Or maybe. I will give him the benefit of the doubt, someone else can cast the stone.

[Nov 09, 2019] Right, one of his possibly effective lines of defense could be that he indeed made that request for the benefit of the country, and that it was just an unfortunate coincidence that it was regarding a political opponent. And he would have some backing evidence in the form of his other unusual requests like pressuring Sweden to release the rapper and all that.

Nov 09, 2019 | www.nakedcapitalism.com

Drake , November 8, 2019 at 2:25 pm

"Trump is guilty of Bribery and Extortion."

I guess what I'm having trouble with is -- is there any foreign policy involving financial or military leverage that isn't bribery and/or extortion? The Marshall Plan? Alliance for Progress? Sanctions of any kind? Aid to Israel and Egypt? What isn't bribery and extortion? If it doesn't involve quid pro quo, then it's charity. I just can't see what Trump is supposed to be guilty of except making this transparent.

John Beech , November 8, 2019 at 2:31 pm

It's all a big joke. Impeach Trump, quickly move on Pence, and presto, President Pelosi (note the awesome alliteration) takes office! Bwa-ha-ha-ha-ha!

turtle , November 8, 2019 at 5:26 pm

The distinction I've heard being made is whether the bribery (or whatever they decide to call it) happened for personal gain or the public's/nation's gain. What's being alleged here is that this was a case where it was for personal gain.

In other words, whatever shady tactics a public representative uses to obtain concessions is just fine if it's to benefit those he or she represents, but not fine if it only benefits the representative him or herself.

I think this line of argument actually makes some sense, so I'm starting to come around to the idea of this impeachment.

Pat , November 8, 2019 at 7:02 pm

Clinton, Military aid to Saudi Arabia, Saudi donation to Clinton Foundation.
Biden threat to withhold aid from Ukraine unless prosecutor fired, son gets to keep five figure job AND stay out of Ukrainian prison.

I am pretty sure a fair case could be made for some other items in the Middle East and South America especially when you look at post government employment and positions.

If I thought any of this would actually change business as usual in DC, I would be all for it. But just as with Benghazi, those in charge of the investigation are trying to take out limited targets while keeping changing SOP out of it.

It is political show and directed by a group of people who should be limited to the same power I have, one vote.

turtle , November 8, 2019 at 7:40 pm

Unfortunately what you say rings true about the usual players trying to selectively prosecute. But at what point do (did?) we just throw our hands up and say (said?) "forget it, let's just ignore this part of the law (constitution)" even in the face of clear evidence that it happened?

As I learn more, this is starting to look to me like a clearer case for an impeachment trial than there was against Clinton, or even against Nixon, since bribery is very specifically mentioned in the constitution as a justification for impeachment (as opposed to the less specific "high crimes and misdemeanors", which I presume is what those other two cases fell under).

redleg , November 8, 2019 at 7:35 pm

If that's the case, then Trump's team has to show that the Bidens were being investigated for corruption. I'm sure that the GOP would gladly include a show-trial of sorts into impeachment proceedings to demonstrate this was the case even if it wasn't.
This whole thing is ridiculous and will only serve to boost Trump, especially when the Dems (again) force-feed a conservative through the convention as their nominee.

turtle , November 8, 2019 at 7:48 pm

Right, one of his possibly effective lines of defense could be that he indeed made that request for the benefit of the country, and that it was just an unfortunate coincidence that it was regarding a political opponent. And he would have some backing evidence in the form of his other unusual requests like pressuring Sweden to release the rapper and all that.

I also agree that this whole thing could possibly boost him, but not necessarily. It may well enrage his base, but it may turn away people in the middle who are still open to solid arguments and evidence.

I don't think the whole thing is ridiculous anymore, and feel that Pelosi decided that she finally had something substantial to start impeachment after talking about it for so long.

polecat , November 8, 2019 at 6:24 pm

The only things he is guilty of, is being an uncouth D.C. outsider that relishes pulling festering scabs off of the tony eastcoast pearl-clutchers, and giving the one-finger salute to California liberals ("I • Drink • Your • Impeachment • MILKSHAKE !, Nancy .. I DRINK IT UP siffft !!) .. when he's not bullchinashopping the Brunch Crowd, swilling the Dom Perrier before making off with the Belgian Waffles.

Titus , November 8, 2019 at 9:18 pm

Mhmmm, it's not a joke. As it seems received wisdom here @NC that trump will be re-elected, & liberal Dems don't get it & lefty can't get elected, what harm is there in holding trump accountable for something, whether you understand it or not, for something that he is actually responsible for?

It matters not if every other president is equally guilty which they are not. There are prices to be paid.

[Nov 09, 2019] Facebook Scrubs All References To Alleged Whistleblower Eric Ciaramella

Nov 09, 2019 | www.zerohedge.com

Facebook Scrubs All References To Alleged Whistleblower Eric Ciaramella by Tyler Durden Fri, 11/08/2019 - 16:45 0 SHARES

Facebook announced on Friday that it would be removing an posts which name alleged Trump-Ukraine whistleblower Eric Ciaramella .

" We are removing any and all mentions of the potential whistleblower's name and will revisit this decision should their name be widely published in the media or used by public figures in the debate ," Facebook said in a statement in which they claim it violates their "coordinating harm" policy which prohibits content 'outing of witness, informant, or activist.'

On Wednesday, the social media giant removed ads naming Ciaramella which had been viewed several hundred thousand times according to the Washington Post .

On Friday, Breitbart ' s Allum Bohkari reported that the news outlet's posts containing references to Ciaramella had been scrubbed from the site.

Wednesday evening, Facebook removed Breitbart posts reporting on the fact other respected news outlets have reported the identity of the alleged whistleblower is Eric Ciaramella. Any Facebook user who attempts to click on that article on Facebook is now given a message that says, "this content isn't available at the moment."

To be clear, Breitbart did not "out" the alleged whistleblower but did provide additional relevant reporting about him ; he is, after all, a public figure, having served on the National Security Council . Moreover, his name has been used in the Mueller report (p283) and Ambassador Bill Taylor's testimony .

Administrators of Breitbart News' Facebook page began receiving notifications on Wednesday evening stating that Breitbart's page is "at risk of being unpublished" but were not given any details as to why, or even which posts were allegedly at issue. - Breitbart

Of note, it is not against the law for anyone except the Inspector General to disclose a whistleblower's name.

" There is no overarching protection for the identity of the whistleblower under federal law ," said attorney Dan Meyer, the former executive director of the intelligence community whistleblower program, adding "Congress has never provided that protection."

[Nov 08, 2019] Bloomberg looks like someone Beijing could work with.

Nov 08, 2019 | www.nakedcapitalism.com

MyLessThanPrimeBeef , November 8, 2019 at 5:22 pm

UPDATE Bloomberg (D)(3): "China to lift ban on state-owned firms buying Bloomberg terminals, source says" [South China Morning Post]. "China never explained the ban but it came shortly after the agency published a story on June 29, 2012, about the finances of the extended family of Xi Jinping – then the vice-president. After the ban, the company withheld an investigative report about Wang Jianlin, the chairman of the Dalian Wanda Group and the one of the wealthiest tycoons well connected with Chinese leaders, in 2013, according to a report by The New York Times. Michael Forsythe, the key author of the investigative reports, left the company shortly afterwards. Bloomberg has never admitted the practice of self-censorship." • Hmm.

-- -

Sounds like someone Beijing coud work with.

[Nov 08, 2019] Perhaps Bloomberg can one up Trump by not only showing up at the Iowa fair in his helicopter but hopping out in a flight suit. Worked for Dubya.

Nov 08, 2019 | www.nakedcapitalism.com

Carolinian , November 8, 2019 at 5:31 pm

Counterpunch' St Clair quotes his late friend Alex Cockburn that anyone rich enough to own a helicopter should be smart enough not to fly in one. Bloomberg pilots his own helicopter.

Perhaps Bloomberg can one up Trump by not only showing up at the Iowa fair in his helicopter but hopping out in a flight suit. Worked for Dubya.

NotTimothyGeithner , November 8, 2019 at 5:44 pm

Chris Matthews talked himself off on air during that stunt.

https://www.mediamatters.org/laura-ingraham/mission-accomplished-look-back-medias-fawning-coverage-bushs-premature-declaration

Here's a president who's really nonverbal. He's like Eisenhower. He looks great in a military uniform. He looks great in that cowboy costume he wears when he goes West. I remember him standing at that fence with Colin Powell. Was [that] the best picture in the 2000 campaign?

He looks for real. What is it about the commander in chief role, the hat that he does wear, that makes him -- I mean, he seems like -- he didn't fight in a war, but he looks like he does.

Women like a guy who's president. Check it out. The women like this war. I think we like having a hero as our president. It's simple. We're not like the Brits. We don't want an indoor prime minister type, or the Danes or the Dutch or the Italians, or a [Russian Federation President Vladimir] Putin. Can you imagine Putin getting elected here? We want a guy as president.

Yep, this is just hard hitting analysis from MSNBC! Trump didn't break these people. He's simply a louder version of them, and they are all jealous they didn't go full in on an anti-immigrant, anti Jeb Bush platform in the GOP primary.

Carolinian , November 8, 2019 at 6:13 pm

Yes, envy is a terrible thing.

If Trump would just slap them on the back and give them nicknames they'd love him.

NotTimothyGeithner , November 8, 2019 at 6:14 pm

LIDDY: Well, I -- in the first place, I think it's envy. I mean, after all, Al Gore had to go get some woman to tell him how to be a man. And here comes George Bush. You know, he's in his flight suit, he's striding across the deck, and he's wearing his parachute harness, you know -- and I've worn those because I parachute -- and it makes the best of his manly characteristic. You go run those -- run that stuff again of him walking across there with the parachute. He has just won every woman's vote in the United States of America. You know, all those women who say size doesn't count -- they're all liars. Check that out. I hope the Democrats keep ratting on him and all of this stuff so that they keep showing that tape.

MATTHEWS: You know, it's funny. I shouldn't talk about ratings. I don't always pay attention to them, but last night was a riot because, at the very time [U.S. Rep.] Henry Waxman [D-CA] was on -- and I do respect him on legislative issues -- he was on blasting away, and these pictures were showing last night, and everybody's tuning in to see these pictures again.

The early 00's were completely insane. Yes, that is G. Gordon Liddy appearing on MSNBC! and discussing George W. Bush's costume.

The Rev Kev , November 8, 2019 at 6:32 pm

Chris Matthews is really kinda getting brown there. Was the same for Obama when he said-

"I have to tell you, you know, it's part of reporting this case, this election, the feeling most people get when they hear Barack Obama's speech. My, I felt this thrill going up my leg. I mean, I don't have that too often."

Kurt Sperry , November 8, 2019 at 7:27 pm

The only way to make the Monday NWT crossword a decent challenge is to solve it using only either the down or across clues.

[Nov 08, 2019] Jewish billionaires for Bloomberg

This is kind on knife in Trump's back ;-)
Nov 08, 2019 | www.nakedcapitalism.com

Bloomberg (D)(1): "Leon Cooperman, who has been battling Elizabeth Warren, says he will support fellow billionaire Mike Bloomberg for president" [ CNBC ]. "Cooperman is one of several Wall Street executives who are already preparing to help Bloomberg in anyway they can if he runs for president. A private equity executive, who declined to be named in order to speak frankly about the situation, said he would likely support Bloomberg's campaign as well." • Say no more! Say no more!

[Nov 08, 2019] Warren correctly said the Biden is running in the wrong primary

Nov 08, 2019 | www.nakedcapitalism.com

"I Have Fought for the Democratic Party My Whole Career" [Joe Biden, Medium ].

"The other day I was accused by one of my opponents [Warren] of running in the wrong primary. Pretty amazing. On one level, it is kind of funny. I have fought for the Democratic party my whole career . It's representative of an elitism that working and middle class people do not share: 'We know best; you know nothing'. ' If you were only as smart as I am you would agree with me .' This is no way to get anything done. This is no way to bring the country together. This is no way for this party to beat Donald Trump." • Front-row, back-row.

[Nov 08, 2019] Scapegoating as the major neoliberal propaganda tool

Nov 08, 2019 | crookedtimber.org

Orange Watch 11.07.19 at 5:11 pm 71

Donald@63 :

The tendency to scapegoat rather than make the case for one's own merit is very deeply ingrained in our top-down liberal democratic systems; the Democratic establishment is unfortunately just getting back to core principles by shifting almost exclusively to this mode of discourse over the past decade. From Guy Debord's 1988 Commentaries on the Society of the Spectacle :

This perfect democracy creates for itself its own inconceivable enemy, terrorism. In effect, it wants to be judged by its enemies moreso than by its results. The history of terrorism is written by the State; it is therefore instructive. The spectator populations certainly cannot know everything about terrorism, but they can always know enough to be persuaded that compared to terrorism, anything else must seem to be more or less acceptable, and in any case more rational and democratic.

[Nov 08, 2019] Well then, thank God for Tucker Carlson: he is against all the Middle East wars, and wants to bring the troops home and put them on our Southern Border

Nov 08, 2019 | www.unz.com

follyofwar , says: November 7, 2019 at 8:08 pm GMT

@DanFromCT Well then, thank god for Tucker Carlson for going against the grain. He is against all the Middle East wars, and wants to bring the troops home and put them on our Southern Border. His is the only show that I watch anymore, and he pushes back from Fox's Israel-first orthodoxy as much as he can and still keep his job, which he wouldn't have if not for his high ratings. Tucker destroyed ultra hawk neocon John Bolton shortly before Trump stupidly appointed him as his NSA.

BTW, Hannity is a war pig, who happens to be right on one issue – supporting Trump against the democrat coup. And Buck is also right, Epstein did not kill himself.

Curmudgeon , says: November 7, 2019 at 9:07 pm GMT
@Patricus You are a victim of finance capitalism propaganda. Communism is Marxism, not socialism. Socialists do not outright reject private ownership, the goal was co-ops to displace finance capital. Co-ops are corporations where every member has only one share. The majority decides, not one shareholder with 50.1% of the shares. The state is not the worker.

Real socialists are opposed to private central banks. I haven't heard any of the allegedly "far left" Democratic Presidential candidates suggest nationalizing the Fed. Ron Paul was more of a socialist than they are on that one.

Also part of the brainwashing is the absolute failure of the vast majority of Americans, who fail to understand that immigration is the reserve army of capital, used to attack the people of the nation. It lowers wages and working conditions; produces more pollution; increases living costs; lowers standards of living; and most importantly, increases profits

Any real nationalism, out of necessity, will have socialist aspects, because doing what is right for the nation, in the truest sense of the word, means that the best solution can come from anywhere on the political spectrum. Governments "own" armies. Is that communism, or should it be a government asset that should be privatized just as the US government privatized the control of its currency.

As long as people dwell in the land of "left" and "right" the owners will continue to divide. One solution would be to ban political parties and require all candidates running for office to be funded equally, out of the public purse. That would make candidates have to face their electorate more directly, and make them more responsive to the electorate, rather than the party. In Congress, the political parties would not get to choose committee chairs, individuals would have to earn the respect of their peers for that.

There is a long way to go.

DanFromCT , says: November 7, 2019 at 9:53 pm GMT
@follyofwar Tucker Carlson is the only news show I can watch, too. The rest is pretty obviously intended to neutralize the rise of native leadership with the relentless insinuation that all we can do is whine like Lou Dobbs and his guests, vote Republican, and show what we're made of by blowing hot air out our asses like Hannity with his mawkish imbecilities about America still being great because he gets great deals at Costco. Sean wuvs America and the gal who follows him turns to American-hating Alan Dershowitz to update us about the espionage of his long-term client Jeffrey Epstein. Check.

Just yesterday the kosher msm was mendaciously portraying our Army's combat vets as baby killers, while today no one says a word when Fox' toadeaters tout that "muh brothers, muh mission" fake and phony honor among "warriors" -- now all heroes of course, just for putting on the uniform for Eretz Israel and the Yinon Plan. More importantly, Fox News' elaborate efforts concealing Israel's culpability for 9/11 constitutes, as a matter of law, powerful circumstantial evidence of their guilt in the greatest act of treason against this country in its history.

Fox News' basecamp commando and armchair warrior types were outed by Homer's Achilles in the ninth century BC, in the Iliad. As Pope's translation has it,

O monster! Mixed of insolence and fear,
Thou dog in forehead, but in heart a deer!
When wert thou known in ambush'd fights to dare,
Or nobly face the horrid front of war?
'Tis ours, the chance of fighting fields to try;
Thine to look on, and bid the valiant die.

How dare Fox News demand we honor the soldiers who foolishly believed Fox News that they were fighting for their country. They still go in droves to their possible deaths, mistaking the costumed bureaucrats in the Pentagon who serve Israel first in all things for warrior patriots like themselves. I do not believe a military whose leadership's chief trait is servility toward a foreign nation and betrayal of its own can survive no matter how much money is counterfeited by the Treasury out of thin air to pay its bills.

[Nov 08, 2019] The Myth of Shareholder Primacy by Sahil Jai Dutta

Notable quotes:
"... Third, the notion of shareholder primacy helped to offload managerial responsibility. An amorphous and often anonymous 'shareholder pressure' became the explanation for all manner of managerial malpractice. Managers lamented the fact they had no choice but to disregard workers and other stakeholders because of shareholder power. Rhetorically, shareholders were deemed responsible for corporate problems. Yet in practice, managers, more often than not, enrolled shareholders into their own projects, using the newly-formed alliance with shareholders to pocket huge returns for themselves. ..."
"... If shareholder demands are understood to be the major problem in corporate life, then the solution is to grant executives more space. Yet the history of shareholder value tells us that managers have been leading the way in corporate governance. They do not need shielding from shareholders or anyone else and instead need to be made accountable for their decisions. Critiques of shareholder primacy risk muddying the responsibility of managers who have long put their own interests first. Perhaps the reason why executives are now so ready to abandon shareholder primacy, is because it never really existed. ..."
Nov 06, 2019 | www.nakedcapitalism.com
By Sahil Jai Dutta, a lecturer in political economy at the University of Goldsmiths, London and Samuel Knafo, a Senior Lecturer in the Department of International Relations at the University of Sussex. Originally published at the PERC blog

In the late 1960s, a young banker named Joel Stern was working on a project to transform corporate management. Stern's hunch was that the stock market could help managers work out how their strategies were performing. Simply, if management was effective, demand for the firm's stock would be high. A low price would imply bad management.

What sounds obvious now was revolutionary at the time. Until then profits were the key barometer of success. But profits were a crude measure and easy to manipulate. Financial markets, Stern felt, could provide a more precise measure of the value of management because they were based on more 'objective' processes, beyond the firm's direct control. The value of shares, he believed, represented the market's exact validation of management. Because of this, financial markets could help managers determine what was working and what was not.

In doing this, Stern laid the foundation for a 'shareholder value' management that put financial markets at the core of managerial strategy.

Stern would probably never have imagined that these ideas would 50 years later be castigated as a fundamental threat to the future of liberal capitalism. In recent times everyone from the Business Roundtable group of global corporations, to the Financial Times , to the British Labour Party has lined up to condemn the shareholder ideology.

"Fifty years of shareholder primacy," wrote the Financial Times, "has fostered short-termism and created an environment of popular distrust of big business."

It is not the first time Stern's creation has come under fire. A decade ago Jack Welsh, former CEO of General Electric declared shareholder value " probably the dumbest idea in the world ". And 15 years before then, British political commentator Will Hutton, among others, found paperback fame with his book The State We're In preaching much the same message.

To critics, the rise of shareholder value is a straightforward story , that has been told over and over again. Following a general crisis of postwar profitability in the late 1970s, corporate managers came under fire from disappointed shareholders complaining about declining returns. Shareholder revolts forced managers to put market capitalisation first. The rise of stock options to compensate corporate managers entrenched shareholder value by aligning the interests of managers and shareholders. Companies began sacrificing productive investments, environmental protections, and worker security to ensure shareholder returns were maximised. The fear of stock market verdicts on quarterly reports left them no choice.

This account fits a widespread belief that financiers and rentiers mangled the postwar golden era of capitalism. More importantly, it suggests a simple solution: liberate companies from the demands of shareholders. Freed from the short-term pursuit of delivering shareholder returns, companies could then return to long-term plans, productive investments, and higher wages.

In two recent articles , we have argued that this critique of shareholder value has always been based on a misunderstanding. Stern and the shareholder value consultants did not aim to put shareholders first. They worked to empower management. Seen in this light, the history of the shareholder value ideology appears differently. And it calls for alternative political responses.

To better understand Stern's ideas, it is important to grasp the broader context in which he was writing. In the 1960s, a group of firms called the conglomerates were pioneering many of the practices that later became associated with the shareholder revolution: aggressive mergers, divestitures, Leverage buy-outs (LBOs), and stock repurchasing.

These firms, such as Litton Industries, Teledyne and LTV revolutionised corporate strategy by developing new techniques to systematically raise money from financial markets. They wheeled and dealed their divisions and used them to tap financial markets to finance further predatory acquisitions. Instead of relying on profits from productive operations, they chased speculative transactions on financial markets to grow.

These same tactics were later borrowed by the 1980s corporate raiders, many of which were in fact old conglomerators from the 1960s. The growing efficiency with which these raiders captured undervalued firms on the stock market and ruthlessly sold off their assets to finance further acquisitions put corporate America on alert.

With fortunes to be made and lost, no manager could ignore the stock market. They became increasingly concerned with their position on financial markets. It was in this context that corporate capitalism first spoke of the desire to 'maximise shareholder value'. While sections of the corporate establishment were put on the defensive, the main reason for this was not that shareholders imposed their preferences on management. Instead, it was competitor managers using the shareholder discourse as a resource to expand and gain control over other firms. Capital markets became the foundation of a new form of financialised managerial power.

These changes made the approach of management consultants championing shareholder value attractive. The firm founded by Stern and his business partner Bennett Stewart III took advantage of the situation. They sold widely their ideas about financial markets as a guideline for corporate strategy to firms looking to thrive in this new environment.

As the discourse and tools of shareholder value took hold, they served three distinct purposes. First, they provided accounting templates for managerial strategies and a means to manage a firm's standings on financial markets. The first and most famous metric for assessing just how much value was being created for shareholders was one Stern himself helped develop, Economic Value Added (EVA).

Second, they became a powerful justification for the idea that managers should be offered share options. This was in fact an old idea floated in the 1950s by management consultants such as Arch Patton of McKinsey as a means to top-up relatively stagnant managerial pay. Yet it was relaunched in this new context as part of the promise to 'align the interests of managers with shareholders.' Stock options helped managerial pay skyrocket in the 1990s, a curious fact for those who believe that managers were 'disciplined' by shareholders.

Third, the notion of shareholder primacy helped to offload managerial responsibility. An amorphous and often anonymous 'shareholder pressure' became the explanation for all manner of managerial malpractice. Managers lamented the fact they had no choice but to disregard workers and other stakeholders because of shareholder power. Rhetorically, shareholders were deemed responsible for corporate problems. Yet in practice, managers, more often than not, enrolled shareholders into their own projects, using the newly-formed alliance with shareholders to pocket huge returns for themselves.

Though shareholder demands are now depicted as the problem to be solved, the same reformist voices have in the past championed shareholders as the solution to corporate excesses. This was the basis for the hope around the ' shareholder spring ' in 2012, or the recent championing of activist shareholders as ' labour's last weapon' .

By challenging the conventional narrative, we have emphasised how it is instead the financialisation of managerialism , or the way in which corporations have leveraged their operations on financial markets, that has characterised the shareholder value shift. Politically this matters.

If shareholder demands are understood to be the major problem in corporate life, then the solution is to grant executives more space. Yet the history of shareholder value tells us that managers have been leading the way in corporate governance. They do not need shielding from shareholders or anyone else and instead need to be made accountable for their decisions. Critiques of shareholder primacy risk muddying the responsibility of managers who have long put their own interests first. Perhaps the reason why executives are now so ready to abandon shareholder primacy, is because it never really existed.


vlade , November 6, 2019 at 5:11 am

Uber. WeWork. Theranos.

I rest my case.

notabanktoadie , November 6, 2019 at 5:51 am

Imagine if all corporations were equally owned by the entire population? Then shareholder primacy would just be representative democracy, no?

But, of course, corporations are not even close to being equally owned by the entire population and part of the blame must lie with government privileges for private credit creation whereby the need to share wealth and power with the entire population is bypassed – in the name of "efficiency", one might suppose.

But what good is the "efficient" creation of wealth if it engenders unjust and therefore dangerous inequality and levies noxious externalities?

Michael , November 6, 2019 at 7:59 am

"An amorphous and often anonymous 'shareholder pressure' became the explanation for all manner of managerial malpractice."

Amorphous? Anonymous? Anybody who faced one of Milken's raiders, or paid Icahn's Greenmail, would disagree. Nelson Putz, er, Peltz just forced P&G to start eating into the foundation of the business to feed his greed. There's nothing amorphous or anonymous about activist shareholders, especially when they take over a company and start carving it up like a Thanksgiving turkey.

Synoia , November 6, 2019 at 8:00 am

Shareholder primacy or Creditor Primacy?

Creditors, or bond holders, appear to be the more powerful. Shareholders have no legal recourse to protect their "ownership." Bondholders do have legal recourse.

Either way, many corporations more serve up their than serve their customers and the general public. There is this belief that if a corporation is profitable, that's good but does not include a public interest (for example Monsanto and Roundup.)

vlade , November 6, 2019 at 9:48 am

Managers used to fear the creditors more than shareholders, that's very much true.

But that has gone out of the window recently, as debt investors just chase return, so it's seller's world, and few of them (debt investors) want to take losses as they are much harder to recoup than before. So extend and pretend is well and alive.

In other words, one of the byproducts of QE is that the company management fears no-one, and is more than happy to do whatever they want.

The problem is the agency. If we assume that we want publicly traded companies (which IMO is not a given), the current incentives are skewed towards management paying themselves.

The problem with things like supervisory boards, even if they have high worker representation, is that those are few individuals, and often can be (directly or indirectly) corrupted by the management.

The "shares" incentive is just dumb, at least in the way it's currently structured. It literally gives only upside, and often even realisable in short/medium term.

d , November 6, 2019 at 4:23 pm

And thats how we got Boeing and PG&E. Just don't think thats the entire list, don't think there is enough room for that

rd , November 6, 2019 at 5:57 pm

Corporations are artificial creations of the state. They exist in their current form under a complex series of laws and regulations, but with certain privileges, such as Limited Liability Corporations. It is assumed that these creatures will enhance economic activity if they are given these privileges, but there is no natural law, such as gravity, that says these laws and regulations need to exist in their current form. They can be changed at will be legislatures.

This is why I despise the Citizens United decision which effectively gives these artificial creations the same rights as people. i don't believe that Thomas Jefferson would have found that to be "a self-evident truth." I think that Citizens United will be regarded as something akin to the Dred Scott decision a century from now.

Shareholder primacy is an assumption that hasn't been challenged over the past couple of decades, but can be controlled by society if it so desires.

Jeremy Grimm , November 6, 2019 at 11:12 am

The semantics of "shareholder primacy" are problematic. The word "shareholder" in this formula echoes the kind problems that whirl around a label like "farmer". A shareholder is often characterized in economics texts as an individual who invests money hoping to receive back dividends and capital gains in the value and valuation of a company as it earns income and grows over time. Among other changes -- changes to the US tax laws undermined these quaint notions of investment, and shareholder. The coincident moves for adding stock options to management's pay packet [threats of firing are supposed to encourage the efforts of other employees -- why do managers needs some kind of special encouragement?], legalizing share buybacks, and other 'financial innovations' -- worked in tandem to make investment synonymous with speculation and shareholders synonymous with speculators, Corporate raiders, and the self-serving Corporate looters replacing Corporate management.

This post follows a twisting road to argue previous "critique of shareholder value has always been based on a misunderstanding" and arrives at a new critique of shareholder value "challenging the conventional narrative." This post begins by sketching Stern's foundation for 'shareholder value' with the assertion imputed to him: "if management was effective, demand for the firm's stock would be high. A low price would imply bad management." The post then claims "What sounds obvious now was revolutionary at the time." But that assertion does not sound at all obvious to me. In terms of the usual framing of the all-knowing Market the assertion sounds like a tautology, built on a shaky ground of Neolilberal economic religious beliefs.

I believe "shareholder primacy" is just one of many rhetorical tools used to argue for the mechanisms our Elites constructed so they could loot Corporate wealth. There is no misunderstanding involved.

xkeyscored , November 6, 2019 at 12:07 pm

"But that assertion does not sound at all obvious to me."
I think you're severely understating this. I'd call it total [family blogging family blog]. As you go on to imply, it takes an act of pure faith, akin to religious faith in Dawkins' sense of belief in the face of evidence to the contrary, to assume or assert this nonsense, except insofar as it's tautological – if the purpose of management is to have a high share price, then obviously the latter reflects the effectiveness of the former.

Susan the Other , November 6, 2019 at 1:06 pm

Well, we're all stakeholders now. There probably isn't much value to merely being a shareholder at this point. First let's ask for a viable definition of "value" because it's pretty hard to financialize an undefined "value" and nobody can financialize an empty isolated thing like the word "management". Things go haywire. What we can do with this seed of an idea is finance the preservation and protection of some defined value. And we can, in fact, leverage a healthy planet until hell freezes over. No problem.

PKMKII , November 6, 2019 at 2:07 pm

This fits within a Marxist analysis as the material conditions spurred the ideological justifications of the conditions, not the ideology spurring the conditions.

mael colium , November 6, 2019 at 5:15 pm

Easy to bust this open by legislating against limited liability. Corporates were not always limited liability, but it was promoted as a means to encourage formation of risky businesses that would otherwise never develop due to risk averse owners or managers. This was promoted as a social compact, delivering employment and growth that would otherwise be unattainable. Like everything in life, human greed overcomes social benefits.

Governments world wide would and should step up and regulate to regain control, rather than fiddling at the margins with corporate governance regulation. They won't, because powerful vested interests will put in place those politicians who will do their bidding. Another nail in the democracy coffin. The only solution will be a cataclysmic event that unites humanity.

RBHoughton , November 7, 2019 at 12:30 am

I think about stock markets as separate from companies and I'm wrong. Each of the stock exchanges I have heard of started off when 4-5 local companies invested a few thousand each in renting a building and a manager to run an exchange hoping it would attract investment, promote their shares and pay for itself.

I remember when one of the major components of the Hong Kong Exchange, Hutchison, had a bad year and really needed some black magic to satisfy the shareholders, the Deputy Chairman abandoned his daytime job and spent trading hours buying and selling for a fortnight to contribute something respectable for the annual accounts. Somebody paid and never knew it. This was at the start of creative accounting and the 'anything goes' version of capitalism that the article connects with Litton Industries, Teledyne and LTV but was infecting the entire inner circle of the money.

[Nov 08, 2019] The age of neoliberalism happened more or less when the USA turned from net exporter to net importer (what Varoufakis called the "global plan" phase and the "global minotaur" phase). I think that probably there is some world cycle stuff going on.

Nov 08, 2019 | crookedtimber.org

MisterMr 11.08.19 at 12:12 pm 76

If we speak of neoliberal economic policies, instead than of neoliberal theories, I believe that there are two aspects that are underappreciated:

1) The age of neoliberalism happened more or less when the USA turned from net exporter to net importer (what Varoufakis called the "global plan" phase and the "global minotaur" phase). I think that probably there is some world cycle stuff going on.

2) It seems to me that new deal economies had strong structural elements pushing wages up (high welfare spending, strong unions, etc.), while in the neoliberal age those element disappeared and were replaced to an almost complete dependence of cyclical measures (deficit spending, interest rates) aimed at creating a permanent boom. When these policies fail we are in deep s-t. But I doubt it is possible to keep a capitalist system permanently in boom mode.
However the pumping up of deficit spending and lowering of the interest rates are also a consequence of neoliberalism and of the overreliance on cyclical instruments, IMHO.

[Nov 08, 2019] I wonder how many Americans still think Ukraine is part of Russia?

Nov 08, 2019 | www.nakedcapitalism.com

Roy G , November 8, 2019 at 3:39 pm

Regarding Bolton and Ukrainegate, what I wonder is, how many people think Ukraine is part of Russia? It's rather bizarre that Russiagate seamlessly morphed into Ukrainegate. The clown car kicker is that the Borg are dirty dirty dirty in Ukraine as well. From MH17 to supporting the Ukronazis to 'F the EU' Nuland, to Biden himself, there are plenty of skeletons to dig up on the 'opposition.'

[Nov 08, 2019] Did Biden pushed Provisional goverment of Yatsenyk-Turchinov for actions that helped to start the civil war in Ukraine? What is the real nature of the EuroMaydan coup d' tat which was spearheaded by Obama administration ?

Nov 08, 2019 | crookedtimber.org

steven t johnson 11.08.19 at 4:36 pm 77

...As for the notion that Biden started the civil war in Ukraine? Nonsense. What really kick started that was the attack on Russian speakers launched as the first order of business. Killing a bunch of people in Odessa by setting a building on fire and trapping them inside was motivation too.

Lee Arnold@72 speaks of democratic process. and Russian expansion. Both are imaginary. The process in Ukraine is fascist. It's true that the open fascists are not at the top, but then, this was true of Franco's Spain, where the Falange party was not on top either. But only a swindler would deny Franco's Spain was fascist.

The idea there was no rebellion against the fascists in Kyiv is preposterous on the face of it. Further, Kharkov nearly went with Donetsk and Lugansk, but the national government managed to keep control. There is no sane scenario where a Russian invasion doesn't take Kharkov, which shows it wasn't Russian invasion that started it. And, conclusively, incorporating Donetsk and Lugansk means ending the war in some fashion that leaves essential control to Moscow. Whatever military assistance Russia gives the rebels is about making sure they don't go too the left in fighting the fascists and making sure there are no embarrassing wave of Russian-speaking refugees from Ukrainian fascism. Endless war is not incorporation. It just means Putin is a fool for thinking one side won't eventually collapse. Lastly, as to Crimea, the simple truth is that the establishment of liberal democracies generally demands consolidation of the national territory, which generally demands redrawing boundaries and ethnic cleansing. The insistence that Ukrainian fascists have a "right" to make Russians in Crimea second-class citizens because of old maps is not becoming.

[Nov 08, 2019] Deep State On The National Security Council Colonel Vindman Is An Expert With An Agenda by Philip Giraldi

Keeping an émigré in charge of the foreign policy towards that country. What could go wrong?
Notable quotes:
"... Vindman apparently sees Ukraine-Russia through the established optic provided by the Deep State, which considers global conflict as the price to pay for maintaining its largesse from the US taxpayer. Continuous warfare is its only business product, which explains in part its dislike of Donald Trump as he has several times threatened to upset the apple cart, even though he has done precious little in reality. Part of Vindman's written statement (my emphasis) is revealing: ""When I joined the NSC in July 2018, I began implementing the administration's policy on Ukraine. In the Spring of 2019, I became aware of outside influencers promoting a false narrative of Ukraine inconsistent with the consensus views of the interagency. This narrative was harmful to US government policy. While my interagency colleagues and I were becoming increasingly optimistic on Ukraine's prospects, this alternative narrative undermined US government efforts to expand cooperation with Ukraine." ..."
"... Alexander Vindman clearly was pushing a policy that might be described as that of the Deep State rather than responding to his own chain of command where it is the president who does the decision making. He also needs a history lesson about what has gone on in his country of birth. President Barack Obama conspired with his own version of Macbeth's three witches – Rice, Power and Jarett – to overthrow the legitimate government of Ukraine in 2014 because it was considered to be too close to Moscow. The regime change was brought about by "mavericks" like the foul-mouthed neocon State Department officer Victoria Nuland and the footloose warmonger Senator John McCain. Vice President Joe Biden also appeared on the scene after the "wetwork" was done, with his son Hunter trailing behind him. Since that time, Ukraine has had a succession of increasingly corrupt puppet governments propped up by billions in foreign aid. It is now per capita the poorest country in Europe. ..."
"... Colonel Vindman, who reported to noted hater of all things Russian Fiona Hill, who in turn reported to By Jingo We'll Go To War John Bolton, was in the middle of all the schemes to bring down Russia. His concern was not really over Trump vs. Biden. It was focused instead on speeding up the $380 million in military assistance, to include offensive weapons, that was in the pipeline for Kiev. And assuming that the Ukrainians could actually learn how to use the weapons, the objective was to punish the Russians and prolong the conflict in Donbas for no reason at all that makes any sense. ..."
"... Vindman's concern is all about Ukraine without any explanation of why the United States would benefit from bilking the taxpayer to support a foreign deadbeat one more time. One wonders if Vindman was able to compose his statement without a snicker or two intruding. He does eventually go on to cover the always essential national security angle, claiming that "Since 2008, Russia has manifested an overtly aggressive foreign policy, leveraging military power and employing hybrid warfare to achieve its objectives of regional hegemony and global influence. Absent a deterrent to dissuade Russia from such aggression, there is an increased risk of further confrontations with the West. In this situation, a strong and independent Ukraine is critical to US national security interests because Ukraine is a frontline state and a bulwark against Russian aggression ." ..."
"... The combined visions of Russia as an aggressive, expansionistic power coupled with the brave Ukrainians serving as a bastion of freedom is so absurd that it is hardly worth countering. Russia's economy is about the size of Italy's or Spain's limiting its imperial ambitions, if they actually exist. Its alleged transgressions against Georgia and Ukraine were both provoked by the United States meddling in Eastern Europe, something that it had pledged not to do after the Soviet Union collapsed. Ukraine is less an important American ally than a welfare case, and no one knows that better than Vindman, but he is really speaking to his masters in the US Establishment when he repeats the conventional arguments. ..."
"... Alexander Vindman does not say or write that the incorporation of Ukraine into NATO is his actual objective, but his comments about "integrating with the West" and the "Euro-Atlantic community" clearly imply just that. ..."
"... A certain colonel named "Colonel" Vindman is secretly running the White House's foreign policy with a secret globalist agenda right under the Donald Trump's nose (a "colonel" who, by the way, is about as battlefield hero as Melania Trump). The outcome? The American foreign policy in shambles, a total sham, a farce on steroids, a schizo chaos of competing special interests, payola, kickbacks, quid-pro-quo big-fish-eats-small clusterfuck, foreign influence-peddling and deepstatism. ..."
"... "It is now per capita the poorest country in Europe" (Ukraine). Well done boys. Another Libya? There is a pattern here. ..."
Nov 08, 2019 | www.zerohedge.com

Authored by Philip Giraldi via The Strategic Culture Foundation,

The current frenzy to impeach President Donald Trump sometimes in its haste reveals that which could easily be hidden about the operation of the Deep State inside the federal government. Congress is currently obtaining testimony from a parade of witnesses to or participants in what will inevitably be called UkraineGate, an investigation into whether Trump inappropriately sought a political quid pro quo from Ukrainian leaders in exchange for a military assistance package.

The prepared opening statement by Lieutenant Colonel Alexander Vindman, described as the top Ukraine expert on the National Security Council (NSC), provides some insights into how decision making at the NSC actually works. Vindman was born in Ukraine but emigrated to the United States with his family at age three. He was commissioned as an army infantry officer in 1998 and served in some capacity in Iraq from 2004-5, where he was wounded by a roadside bomb and received a purple heart. Vindman, who speaks both Ukrainian and Russian fluently, has filled a number of diplomatic and military positions in government dealing with Eastern Europe, to include a key role in Pentagon planning on how to deal with Russia.

Vindman, Ukrainian both by birth and culturally, clearly was a major player in articulating and managing US policy towards that country, but that is not really what his role on the NSC should have been. As more than likely the US government's sole genuine Ukrainian expert, he should have become a source of viable options that the United States might exercise vis-à-vis its relationship with Ukraine, and, by extension, regarding Moscow's involvement with Kiev. But that is not how his statement, which advocates for a specific policy, reads. Rather than providing expert advice, Vindman was concerned chiefly because arming Ukraine was not proceeding quickly enough to suit him, an extremely risky policy which has already created serious problems with a much more important Russia.

Vindman apparently sees Ukraine-Russia through the established optic provided by the Deep State, which considers global conflict as the price to pay for maintaining its largesse from the US taxpayer. Continuous warfare is its only business product, which explains in part its dislike of Donald Trump as he has several times threatened to upset the apple cart, even though he has done precious little in reality. Part of Vindman's written statement (my emphasis) is revealing: ""When I joined the NSC in July 2018, I began implementing the administration's policy on Ukraine. In the Spring of 2019, I became aware of outside influencers promoting a false narrative of Ukraine inconsistent with the consensus views of the interagency. This narrative was harmful to US government policy. While my interagency colleagues and I were becoming increasingly optimistic on Ukraine's prospects, this alternative narrative undermined US government efforts to expand cooperation with Ukraine."

Alexander Vindman clearly was pushing a policy that might be described as that of the Deep State rather than responding to his own chain of command where it is the president who does the decision making. He also needs a history lesson about what has gone on in his country of birth. President Barack Obama conspired with his own version of Macbeth's three witches – Rice, Power and Jarett – to overthrow the legitimate government of Ukraine in 2014 because it was considered to be too close to Moscow. The regime change was brought about by "mavericks" like the foul-mouthed neocon State Department officer Victoria Nuland and the footloose warmonger Senator John McCain. Vice President Joe Biden also appeared on the scene after the "wetwork" was done, with his son Hunter trailing behind him. Since that time, Ukraine has had a succession of increasingly corrupt puppet governments propped up by billions in foreign aid. It is now per capita the poorest country in Europe.

Washington inside-the-beltway and the Deep State choose to blame the mess in Ukraine on Russian President Vladimir Putin and the established narrative also makes the absurd claim that the political situation in Kiev is somehow important to US national security. The preferred solution is to provide still more money, which feeds the corruption and enables the Ukrainians to attack the Russians.

Colonel Vindman, who reported to noted hater of all things Russian Fiona Hill, who in turn reported to By Jingo We'll Go To War John Bolton, was in the middle of all the schemes to bring down Russia. His concern was not really over Trump vs. Biden. It was focused instead on speeding up the $380 million in military assistance, to include offensive weapons, that was in the pipeline for Kiev. And assuming that the Ukrainians could actually learn how to use the weapons, the objective was to punish the Russians and prolong the conflict in Donbas for no reason at all that makes any sense.

Note the following additional excerpt from Vindman's prepared statement: " .I was worried about the implications for the US government's support of Ukraine . I realized that if Ukraine pursued an investigation into the Bidens and Burisma, it would likely be interpreted as a partisan play which would undoubtedly result in Ukraine losing the bipartisan support it has thus far maintained ."

Vindman's concern is all about Ukraine without any explanation of why the United States would benefit from bilking the taxpayer to support a foreign deadbeat one more time. One wonders if Vindman was able to compose his statement without a snicker or two intruding. He does eventually go on to cover the always essential national security angle, claiming that "Since 2008, Russia has manifested an overtly aggressive foreign policy, leveraging military power and employing hybrid warfare to achieve its objectives of regional hegemony and global influence. Absent a deterrent to dissuade Russia from such aggression, there is an increased risk of further confrontations with the West. In this situation, a strong and independent Ukraine is critical to US national security interests because Ukraine is a frontline state and a bulwark against Russian aggression ."

The combined visions of Russia as an aggressive, expansionistic power coupled with the brave Ukrainians serving as a bastion of freedom is so absurd that it is hardly worth countering. Russia's economy is about the size of Italy's or Spain's limiting its imperial ambitions, if they actually exist. Its alleged transgressions against Georgia and Ukraine were both provoked by the United States meddling in Eastern Europe, something that it had pledged not to do after the Soviet Union collapsed. Ukraine is less an important American ally than a welfare case, and no one knows that better than Vindman, but he is really speaking to his masters in the US Establishment when he repeats the conventional arguments.

It hardly seems possible, but Vindman then goes on to dig himself into a still deeper hole through his statement's praise of the train wreck that is Ukraine. He writes "In spite of being under assault from Russia for more than five years, Ukraine has taken major steps towards integrating with the West . The US government policy community's view is that the election of President Volodymyr Zelensky and the promise of reforms to eliminate corruption will lock in Ukraine's Western-leaning trajectory, and allow Ukraine to realize its dream of a vibrant democracy and economic prosperity. The United States and Ukraine are and must remain strategic partners, working together to realize the shared vision of a stable, prosperous, and democratic Ukraine that is integrated into the Euro-Atlantic community ."

Alexander Vindman does not say or write that the incorporation of Ukraine into NATO is his actual objective, but his comments about "integrating with the West" and the "Euro-Atlantic community" clearly imply just that. The expansion of NATO up to Russia's borders by the rascally Bill Clinton constituted one of the truly most momentous lost foreign policy opportunities of the twentieth century. The addition of Ukraine and Georgia to the alliance would magnify that error as both are vital national security interests for Moscow given their history and geography. Vindman should be regarded as a manifestation of the Deep State thinking that has brought so much grief to the United States over the past twenty years. Seen in that light, his testimony, wrapped in an air of sanctimoniousness and a uniform, should be regarded as little more than the conventional thinking that has produced foreign policy failure after failure.


DEDA CVETKO , 2 minutes ago link

Exactly 100 years ago, in 1919, a certain colonel named "Colonel" House was secretly running the White House's foreign policy with a secret globalist agenda right under the Woodrow Wilson's nose (a "colonel" who, by the way, was neither an army officer, nor the battlefield hero - in fact, he was about as much of a colonel as Colonel Parker). The outcome? The post-World War 1 "new world order" (which was neither new, nor order, nor global in any sense) that was a nightmare on steroids, a humpty-dumpty Frankenstein that gave birth to both Nazism and Bolshevism as well as Globalist Elitism, American Exceptionalism, and New Deal Neoliberalism and was every satanist's wet dream. Short of procreating Beelzebub and Baphomet, "Colonel" House just about did 'em all.

Fast forward 100 years, back to the future: year 2019 AD. A certain colonel named "Colonel" Vindman is secretly running the White House's foreign policy with a secret globalist agenda right under the Donald Trump's nose (a "colonel" who, by the way, is about as battlefield hero as Melania Trump). The outcome? The American foreign policy in shambles, a total sham, a farce on steroids, a schizo chaos of competing special interests, payola, kickbacks, quid-pro-quo big-fish-eats-small clusterfuck, foreign influence-peddling and deepstatism.

So, yes, Karl Marx was, for once, right. History really does repeat itself. It first comes as a tragedy and then returns the second time around as an inbred farce. Or a slapstick.

East Indian , 4 minutes ago link

Keeping an émigré in charge of the foreign policy towards that country. What could go wrong?

youshallnotkill , 7 minutes ago link

Born in the Ukraine, and Jewish. So the knives are out - who cares that he is a vet awarded with a Purple Heart.

Someone Else , 4 minutes ago link

A vet with a Purple Heart can be a piece of crap just like anyone else. Neither status is akin to sainthood. In fact this guy should be ashamed of the way the US government has wronged Ukraine and he is a damned big part of it.

Soloamber , 9 minutes ago link

It is absolutely mind boggling how the Democrats get away with making up false claims over and over but the real losers are voters who are paying useless jack asses to do nothing. What has the House done ? Further testimony to the farce is Mr. Magoo , Sessions , thinking he might have some contribution to make .

Bear , 7 minutes ago link

Useless jackasses and exceptionally dangerous

J S Bach , 14 minutes ago link

From wikipedia...

Alexander Semyon Vindman (né Aleksandr Semenovich Vindman) and his identical twin brother Yevgeny were born to a Jewish family in the Ukrainian Soviet Socialist Republic , Soviet Union .

JLM , 20 minutes ago link

"It is now per capita the poorest country in Europe" (Ukraine). Well done boys. Another Libya? There is a pattern here.

Soloamber , 20 minutes ago link

And Vindman sat with his whistle up his *** while Biden played pay to play and blackmailed Ukraine into dropping the investigation of the company his under qualified over paid son sat on. Biden let his ego overtake reason and admitted on tape what he did . Held back payment to Ukraine unless a judge was off the case .

What did Vindman do about that ? Was he in on it ? Vindman is a patsy and a gossip . Nothing more . OK except for lying about his deep Democrat attachments . The guy looks like a deer in headlights but he is just being used .

Vooter , 23 minutes ago link

So the entire "Deep State" is basically just populated by monkeys...

Bear , 5 minutes ago link

Too generous a description ... Rats is better

Omega_Man , 26 minutes ago link

don't all the *** spies have an agenda?

Demologos , 26 minutes ago link

Vindman is a pasty-faced lying asshat. Later I'll let you know how I really feel.

East Indian , 4 minutes ago link

Keeping an emigre in charge of the foreign policy towards that country. What could go wrong?

Someone Else , 4 minutes ago link

A vet with a Purple Heart can be a piece of crap just like anyone else. Neither status is akin to sainthood. In fact this guy should be ashamed of the way the US government has wronged Ukraine and he is a damned big part of it.

[Nov 08, 2019] More Evidence that The Comey FBI was a Malevolent Clown Show by Larry C Johnson

Notable quotes:
"... "The "crazies in the basement" is an expression that was coined originally by some unknown member of George W's administration. It used to designate the small clique of Neo-Cons who had found their way into Bush junior's team of advisors, before they rose to dubious fame after the 9/11 attacks. ..."
"... Col. Lawrence Wilkerson, at the time Colin Powell's chief of staff, described their status enhancement from "lunatic fringe" to top executives in the White House with his Southern sense of humor, adding that they had become almost overnight what was henceforth called the Cheney "Gestapo". And what happened over the weekend in the Middle-East – and in D.C. – certainly looked like a distant but distinct reminder of that period in the early 2000s when "crazies" coming right out of a dark basement took over the policy agenda on questions that would require adult supervision." ..."
"... Both in Canada and the States men and women of Eastern European background have risen to positions of influence in the respective administrations. I'd argue that that has not been uniformly beneficial. Not when those men and women enlist under the crazy banner. ..."
"... To a great degree American foreign policy no longer operates in the interests of the broad mass of the American people. It too often plays to the obsessions inherited from Old Europe. ..."
Nov 08, 2019 | turcopolier.typepad.com

Brent , 06 November 2019 at 03:04 PM

From what I have read, I gather that the FBI in the Mueller / Comey era has made extensive use of "perjury traps". They then threaten charges to get someone to "flip" on someone bigger, in this case Trump. Flynn wouldn't flip even when they threatened to go after Flynn's son. So they decided to "F" him, as stated by Andrew McCabe.

The FBI has been thoroughly disgraced, and Wray is incapable of cleaning it up. He just wants to keep the dirt under the rug. It is too late for that, it is all coming out. US citizens deserve to know how dirty our FBI and CIA are - they are criminal organizations.

Factotum said in reply to Brent ... , 06 November 2019 at 05:45 PM
I am reminded of Susan MacDougall in the Clinton Whitewater case, decades ago -she claimed "they' were trying to make her flip too - can't remember who was on which side, but was it also government prosecutors against a vulnerable individual who they had hope to break to get the goods they decided they wanted? If so, I guess we need generational reminders of the awesome and terrifying powers of an overly powerful "government".
confusedponderer -> Factotum... , 07 November 2019 at 06:35 AM
Factorum,
re: I guess we need generational reminders of the awesome and terrifying powers of an overly powerful "government".

I'd put it more precise - "the awesome and terrifying powers of ANY overly powerful "government".

If it's an Obama FBI crew getting after you or a Trump FBI crew - it must be very bad every time, guilty of anything or not. A classic case of how really bad it can get is Brazil's evangelical Bolsonaro. Iirc a Brazilian TV station had reported that his son was likely deeply involved in the murder of a left politician or reporter in Brazil, a deed done by former Brazilian cops who also happened to call Bolsonaro's house.

Bolsonaro simply freaked out and was not interested at all in any investigation. or the question whether the report was accurate. He simply threatened the TV station that, when reelected, he would nullify their media license. He showed no interest in any reality or facts but was just trying to brutally silence and intimidate the media outlet he doesn't like. He also suggested that his son should become Brazil's ambassador to the US. Probably a perfect job since Trump doesn't have any problems with the Saudi murder prince MbS as well.

A crook by the book ...

Anon said in reply to Factotum... , 07 November 2019 at 01:55 PM
K.T. McFarland (whose name comes up every now and then in this matter) has some pertinent thought to on how the government used its power against Flynn:
"KT McFarland speaks for first time about Michael Flynn" , Fox News interview, 2019-11-05
Andrei Martyanov (aka SmoothieX12) , 06 November 2019 at 04:07 PM
Is it just me (wink, wink) but I find it completely coincidental that both Strzok (100%) and Pientka (likely) are of Polish origins. Could it be my Russian paranoia. Nah, I am being unreasonable--those people never had a bad feeling towards Trump's attempts to boost Russian-American relations with Michael Flynn spearheading this effort. Jokes aside, however, I can only imagine how SVR and GRU are enjoying the spectacle. I can only imagine how many "free" promotions and awards can be attach to this thing as a free ride.
English Outsider -> Andrei Martyanov (aka SmoothieX12) ... , 07 November 2019 at 09:19 AM
Your comment brings to mind the outdated Russophobia of many in positions of influence within the American administration. I couldn't remember who coined the term "the crazies in the basement" as applied to the more hawkish elements in US politics. I thought it had been an American Admiral. I had no luck finding a reference so I googled it. Still no joy with the American admiral, but the list thrown up had near the top of it this informative quote from Patrick Bahzad.

"The "crazies in the basement" is an expression that was coined originally by some unknown member of George W's administration. It used to designate the small clique of Neo-Cons who had found their way into Bush junior's team of advisors, before they rose to dubious fame after the 9/11 attacks.

Col. Lawrence Wilkerson, at the time Colin Powell's chief of staff, described their status enhancement from "lunatic fringe" to top executives in the White House with his Southern sense of humor, adding that they had become almost overnight what was henceforth called the Cheney "Gestapo". And what happened over the weekend in the Middle-East – and in D.C. – certainly looked like a distant but distinct reminder of that period in the early 2000s when "crazies" coming right out of a dark basement took over the policy agenda on questions that would require adult supervision."

Both in Canada and the States men and women of Eastern European background have risen to positions of influence in the respective administrations. I'd argue that that has not been uniformly beneficial. Not when those men and women enlist under the crazy banner. Or, to put it more soberly, form part of the neocon wing of those administrations. Though I, as an outside observer, might be prejudiced here because I happen not to get on very well with Brzezinski and his copious output.

Allowing for that prejudice, which I confess runs very deep, I still think that to an extent American foreign policy has been hijacked by Eastern European emigres who themselves retain some of the prejudices and mindset of another age and place.

Looking at it from afar, the influence of some Eastern European emigres on American foreign policy has been uniformly deleterious. And that from a long way back and no matter whether those emigres are in Washington or Tel Aviv.

It cannot but help be distorting, that influence. It's not merely that unexamined Russophobia is embedded in the DNA of many Eastern Europeans. There's a narrow minded focus on aggressive Machtpolitik, bred from centuries of violent territorial disputes with neighbors.

That, transferred to the world stage as it must be when it infects the foreign policy of the United States - because that is a country that cannot but help be at the centre of the world stage - distorts US foreign policy. To a great degree American foreign policy no longer operates in the interests of the broad mass of the American people. It too often plays to the obsessions inherited from Old Europe.

In the most famous of his speeches Churchill spoke of the time when, as he hoped, "the New World, with all its power and might, steps forth to the rescue and the liberation of the old."

Let the historians dispute as they will, that is what happened. And continued to happen for half a century and more. But there was a price few noticed. The New World might have stepped forward to rescue the old, but it carried back from that old world a most destructive freight.

akaPatience , 07 November 2019 at 03:22 AM
If all of this corruption were carried out to entrap or thwart a liberal Democrat instead of Trump and his associates, we all know the MSM would be banging a drum of utter outrage, 24/7. We'd never hear the end of a story such as this -- that the FBI misidentified the authors of Flynn's interview notes. Unbelievable.

A while back, I recall reading about a sexual discrimination or harassment case involving FBI's Andrew McCabe in which Gen. Flynn intervened on behalf of the female accuser, and it was thought by some that the bogus charge against the general was in part an act of revenge on McCabe's behalf. There are so many dots out there, unconnected, because the MSM is doing its best to suppress the truth.

How long can they continue to hear, see and speak no evil if the you-know-what hits the fan? I guess we're going to find out.

Fred -> akaPatience ... , 07 November 2019 at 09:41 AM
akaPatience,

How do you know the FBI/DOJ and our wonderful allies never did this to a Democratic politician before? Keeping them in office and subject to extortion to get favorable policies in place would be far more effective than removing someone from office. Perhaps we should ask Jeffrey Epstein just what those politicians and businessmen were doing on that island, that manions in NYC or the one in Paris.....

jd hawkins , 07 November 2019 at 04:11 AM
" I can only imagine how SVR and GRU are enjoying the spectacle".

Guess the neo fbi is enjoying it too________ or not so much!!!

JohninMK , 07 November 2019 at 07:49 AM
Is this just a situation where the DoJ are giving the judge an easy way out to throw the case for a technical reason?

This would leave Flynn high and dry without his innocence having been proved having just got off on a technicality. Also the DoJ would not be exposed to having to produce all the damning stuff that the Honey Badger wants out in public.

Very interesting to see which way Judge Sullivan goes now. Wonder if he wants another Powell book.

Fred -> JohninMK... , 07 November 2019 at 09:36 AM
JohninMK,

Which country are you from where people have to prove innocence rather than prosecutors prove guilt? A technicality - do you mean that as a joke since this is obviously criminal misconduct by the FBI/DOJ; or do you really believe they made a mistake that went undiscovered through the entire Mueler probe, congressional testimony and a couple years worth of legal discovery by defense counsel?

Flavius , 07 November 2019 at 10:59 AM
The manner in which Comey and his select team of officials engineered the Flynn 'interview' was contemptible, but not surprising. The group had been steeping in politics from the moment Comey agreed to the Clinton e-mail case under the conditions he did. The special organization he created, an FBI within the FBI operating out of HQ, the administering of 'blood oaths', etc, only made matters worse, or better, depending on one's political point of view. The only thing lacking was secret hand shakes.
In my now outdated experience, the charge of lying to the FBI was viewed as B.S., period; it was never even contemplated as as a stand alone charge. Separated from a substantive charge, it is worse than B.S.
There are several things wrong about the Flynn interview. Among them: if there was indeed a reason for a strategy session to deceive Flynn about his possibly requiring a lawyer, that reason to the fair minded person meant there should have been no need for a strategy session: the interview required telling Flynn that he had the right to a lawyer; he should have been told the purpose of the interview, ie what it was he was suspected of having done wrong and that the import of his answers was sufficiently serious that if he didn't tell the truth he could be charged with lying; if there was uncertainty whether Flynn had told the truth, as apparently there was because the 302 was subjected to editing and reediting, itself highly irregular, the proper way to have resolved any question would have been to reinterview Flynn, not tailor the paperwork to support the charge; if in fact Flynn did lie, what was the harm caused by the lie, or put another way, what would have been the outcome if Flynn had told the truth.
On the subject of recorded interviews, I am of uncertain mind. There is a before interview; there is an after interview. Electronics change the dynamics of the interview itself, and it may be to the advantage of the person interviewed and it may be to his or her disadvantage. If an interview is fairly played, there should be no need to record it; if the interview is intent on something other than fair play, he will find some way to game the electronics. Electronics are no panacea to instilling integrity where integrity is not otherwise to be found.
David Habakkuk , 07 November 2019 at 11:00 AM
Larry,

The 'honey badger' was a species unknown to me, but having looked that animal up, it seems an apt comparison.

Indeed, at the risk of being frivolous, I am tempted to quote the Kipling refrain about the 'female of the species' being 'deadlier than the male.' It seems to me quite likely that people at the FBI, and elsewhere, are still finding it difficult to grasp what has hit them.

Something which interests me greatly is the possible knock-on effects of Ms. Powell's breakthroughs in exposing the conspiracy to frame Michael Flynn on other cases, notably those in which Ty Clevenger and Steven S. Biss are involved.

The pair are representing Ed Butowsky and Devin Nunes, and also, crucially, Svetlana Lokhova, in her case against the 'ratfucker' – the term used in the 'Complaint' – Stefan Halper and some of the MSM organisations who have collaborated in his 'dirty tricks.'

In all of these cases, material freely available on the 'Courtlistener' site is a mine of fascinating information.

Of particular interest at the moment, I think, are the efforts of Clevenger to 'prise open' the cover-up over the role over Seth Rich in leaking the materials from the DNC which the conspirators falsely alleged were hacked by the Russians, and that about the circumstances of his murder.

These efforts have been aided by a remarkable 'hostage to fortune' given by Deborah Sines, a former Assistant U.S. Attorney in D.C. who was assigned to the Rich case.

On 8 October, Clevenger produced motions to 'accept supplemental evidence' and 'permit discovery' in the case he has himself brought against the DOJ, FBI and NSA. (His filing is freely available at https://www.courtlistener.com/docket/6775665/clevenger-v-us-department-of-justice/ .)

The 'supplemental evidence' in question appeared back in July in Episode 5 of the podcast 'Conspiracyland' which Michael Isikoff produced for 'Yahoo! News'. In this, Ms. Sines recycled the familiar disinformation from Andrew McCabe to the effect that it had been established that there was no connection between Rich and Wikileaks.

She then suggested that the FBI had indeed examined his computer, but solely because someone had been trying to 'invade his Gmail account and set up a separate account after Seth was murdered.' The supposed purpose of this activity, by a 'foreign hacker', was 'so they could dump false information in there.'

As Clevenger pointed out, this claim is rather hard to reconcile with the FBI's insistence that it has no records pertaining to Rich, and makes the Bureau's refusal to search its Computer Analysis Response Team ("CART") for relevant records, and the Washington Field Office for email records, look even more suspicious than it already did.

From the 'Courtlistener' pages it also appeared that, following a telephone conference, Magistrate Judge Lois Bloom ruled that the statement by Ms. Sines did not rise to the 'level of bad faith' required to justify the 'discovery' that Clevenger sought, on the basis of it.

Also freely available on 'Courtlistener', however, is an 'Unopposed motion for stay' which Clevenger filed on 30 November. From this, we learn that Judge Bloom had 'noted that Ms. Sines' statements were not made under oath, further suggesting that the Plaintiff might try to obtain a sworn statement from Ms. Sines.'

In response, Clevenger made clear that he intended to subpoena that lady for a deposition, in the relation to the defamation cases brought against Michael Gottlieb et al, and also David Folkenflik et al, where he is representing Ed Butowsky.

Accordingly, he asked the Court to stay his own case 'until the deposition of Ms. Sines can be arranged and the transcripts can be produced.' Apparently, there was no objection from the DOJ, FBI, and NSA.

In addition, Clevenger asked the court to take 'judicial notice' of the fact that, in her reply dated 24 October to the lawyers for the USG, 'attorney Sidney Powell laid out damning evidence that high-ranking FBI officials systematically tampered with records and hid exculpatory evidence for the purpose of framing the defendant, retired General Mike Flynn.'

So it looks as though what the 'honey badger' has been digging out in relation to Flynn may help in the burrowing efforts of others in related matters – who may be in a position to return the favour.

Increasingly, it seems not entirely unthinkable that the cumulative effect of of the cases in which Powell, Clevenger and Biss are involved may blow open the whole conspiracy against the Constitution, irrespective of whether or not Horowitz, Barr and Durham are prepared to go substantially beyond a 'limited hangout.'

Another important, and neglected, aspect here relates to the cases still ongoing against Steele and Orbis in London – that brought by Aleksej Gubarev, and that by the Alfa oligarchs. It is material that libel laws on this side are noticeably less favourable to defendants than on yours – not least in that the 'fair report privilege' retains its original narrower construction here.

Unfortunately, we do not have here any equivalent to 'PACER' and 'Courtlistener.' The last I heard about the Gubarev case was in the spring, when his American lawyers suggested that it should come to court before Xmas.

It would not at all surprise me if it was postponed. Ironically, however, I now think that it may be quite likely that his British lawyers see delay as being in Gubarev's interests.

A critical point is that Steele is making no attempt to defend the accuracy of the claims about the involvement of Gubarev and his companies in hacking in the final memorandum in the dossier.

It seems quite likely that what is coming to light as the result of the lawsuits on your side may make it materially more difficult to mount any credible case that these were not very seriously defamatory.

There have been repeated attempts to locate the dossier attributed to Steele in another version of a familiar 'Russophobic' narrative, suggesting that he was deliberately fed disinformation by his Russian contacts as part of an 'active measures' campaign.

In my view, these are largely BS. However, a possible partial exception has to do with the claims about Gubarev, which follow on from the those made in Company Report 2016/086, which is dated 26 July 2015.

My suspicion has long been that the sloppy misdating – 2016 is clearly meant – reflected the fact that the document was part of a panic-stricken response to the murder of Rich, which had taken place on 10 July. What I may well have happened is that FBI cybersecurity people, who had been cultivating sources among their FSB counterparts, put out an urgent request, which generated material that went into the dossier.

If that was the case however, it would have been likely that some of their informants were playing a 'double game.' And my suspicion is that, when a further request was put in, following Trump's election victory, those making it were fed a 'baited hook' about Gubarev, very likely cast in the hope of producing something like the outcome that materialised.

I noted with interest that both Devin Nunes and Lee Smith are now expressing scepticism about the notion that Steele's role was in actually authoring the dossier, rather than taking ownership of a compendium essentially produced within Fusion GPS.

Another ground for believing this was put into sharp focus with the publication by 'Judicial Watch' in September of – heavily redacted – versions of reports from Steele circulated in the State Department prior to the dossier.

(See https://www.judicialwatch.org/tag/christopher-steele/ )

These clarify a matter which has long puzzled me about the memoranda. Normally, one would expect the product of a serious business intelligence company to be properly presented, on headed stationery, without elementary errors. And one would not expect a numbering which suggests that the documents made public are part of a much larger series.

A document dated 13 June 2014, headline 'RUSSIA-UKRAINE CRISIS: Kremlin Emboldened to Challenge USG Sanctions and Anti-Russian Leverage On Financial Markets', which is labelled 'Report ID: 2014/130a', suggests that we are actually dealing with a format used in an information service sent out to a large number of clients. Precisely what this would not contain was material attributed to highly sensitive sources.

So the clumsy imitation of this formatting in the dossier gives further reason to believe that it was produced by people other than Steele, who were trying to attribute authorship to him.

A further implication is that Steele may have ended up left facing libel charges in relation to claims for which he was not actually responsible.

In addition to those about Gubarev, the use of the transliteration 'Alpha' instead of 'Alfa' for the Fridman/Aven/Khan group makes me think that the author of the relevant memorandum was not a native English speaker, but someone used to thinking in Russian and/or Ukrainian.

If so, the memorandum may be part of 'Ukrainegate', which, unlike 'Russiagate', looks like being a real story.

And here, of course, the question of what became of Seth Rich's laptop, and what information the FBI is concealing about it, is again critical.

It would not in the least surprise me if the kind of traces described by Ms. Sines are actually really present on some hard drive.

If however they are, a quite likely explanation is that Alperovitch and his Ukrainian 'partners-in-crime' organised a hack, after the leak was discovered, as part of the more general attempt to obfuscate the truth.

Factotum , 07 November 2019 at 12:56 PM
Why does the media and virtually every pundit commenting on the Ukrainian phone call intentionally avoid any mention of Trump's Crowdstrike "favor" request?

[Nov 08, 2019] The Myth of Shareholder Primacy naked capitalism

Nov 08, 2019 | www.nakedcapitalism.com

The Myth of Shareholder Primacy Posted on November 6, 2019 by Yves Smith By Sahil Jai Dutta, a lecturer in political economy at the University of Goldsmiths, London and Samuel Knafo, a Senior Lecturer in the Department of International Relations at the University of Sussex. Originally published at the PERC blog

In the late 1960s, a young banker named Joel Stern was working on a project to transform corporate management. Stern's hunch was that the stock market could help managers work out how their strategies were performing. Simply, if management was effective, demand for the firm's stock would be high. A low price would imply bad management.

What sounds obvious now was revolutionary at the time. Until then profits were the key barometer of success. But profits were a crude measure and easy to manipulate. Financial markets, Stern felt, could provide a more precise measure of the value of management because they were based on more 'objective' processes, beyond the firm's direct control. The value of shares, he believed, represented the market's exact validation of management. Because of this, financial markets could help managers determine what was working and what was not.

In doing this, Stern laid the foundation for a 'shareholder value' management that put financial markets at the core of managerial strategy.

Stern would probably never have imagined that these ideas would 50 years later be castigated as a fundamental threat to the future of liberal capitalism. In recent times everyone from the Business Roundtable group of global corporations, to the Financial Times , to the British Labour Party has lined up to condemn the shareholder ideology.

"Fifty years of shareholder primacy," wrote the Financial Times, "has fostered short-termism and created an environment of popular distrust of big business."

It is not the first time Stern's creation has come under fire. A decade ago Jack Welsh, former CEO of General Electric declared shareholder value " probably the dumbest idea in the world ". And 15 years before then, British political commentator Will Hutton, among others, found paperback fame with his book The State We're In preaching much the same message.

To critics, the rise of shareholder value is a straightforward story , that has been told over and over again. Following a general crisis of postwar profitability in the late 1970s, corporate managers came under fire from disappointed shareholders complaining about declining returns. Shareholder revolts forced managers to put market capitalisation first. The rise of stock options to compensate corporate managers entrenched shareholder value by aligning the interests of managers and shareholders. Companies began sacrificing productive investments, environmental protections, and worker security to ensure shareholder returns were maximised. The fear of stock market verdicts on quarterly reports left them no choice.

This account fits a widespread belief that financiers and rentiers mangled the postwar golden era of capitalism. More importantly, it suggests a simple solution: liberate companies from the demands of shareholders. Freed from the short-term pursuit of delivering shareholder returns, companies could then return to long-term plans, productive investments, and higher wages.

In two recent articles , we have argued that this critique of shareholder value has always been based on a misunderstanding. Stern and the shareholder value consultants did not aim to put shareholders first. They worked to empower management. Seen in this light, the history of the shareholder value ideology appears differently. And it calls for alternative political responses.

To better understand Stern's ideas, it is important to grasp the broader context in which he was writing. In the 1960s, a group of firms called the conglomerates were pioneering many of the practices that later became associated with the shareholder revolution: aggressive mergers, divestitures, Leverage buy-outs (LBOs), and stock repurchasing.

These firms, such as Litton Industries, Teledyne and LTV revolutionised corporate strategy by developing new techniques to systematically raise money from financial markets. They wheeled and dealed their divisions and used them to tap financial markets to finance further predatory acquisitions. Instead of relying on profits from productive operations, they chased speculative transactions on financial markets to grow.

These same tactics were later borrowed by the 1980s corporate raiders, many of which were in fact old conglomerators from the 1960s. The growing efficiency with which these raiders captured undervalued firms on the stock market and ruthlessly sold off their assets to finance further acquisitions put corporate America on alert.

With fortunes to be made and lost, no manager could ignore the stock market. They became increasingly concerned with their position on financial markets. It was in this context that corporate capitalism first spoke of the desire to 'maximise shareholder value'. While sections of the corporate establishment were put on the defensive, the main reason for this was not that shareholders imposed their preferences on management. Instead, it was competitor managers using the shareholder discourse as a resource to expand and gain control over other firms. Capital markets became the foundation of a new form of financialised managerial power.

These changes made the approach of management consultants championing shareholder value attractive. The firm founded by Stern and his business partner Bennett Stewart III took advantage of the situation. They sold widely their ideas about financial markets as a guideline for corporate strategy to firms looking to thrive in this new environment.

As the discourse and tools of shareholder value took hold, they served three distinct purposes. First, they provided accounting templates for managerial strategies and a means to manage a firm's standings on financial markets. The first and most famous metric for assessing just how much value was being created for shareholders was one Stern himself helped develop, Economic Value Added (EVA).

Second, they became a powerful justification for the idea that managers should be offered share options. This was in fact an old idea floated in the 1950s by management consultants such as Arch Patton of McKinsey as a means to top-up relatively stagnant managerial pay. Yet it was relaunched in this new context as part of the promise to 'align the interests of managers with shareholders.' Stock options helped managerial pay skyrocket in the 1990s, a curious fact for those who believe that managers were 'disciplined' by shareholders.

Third, the notion of shareholder primacy helped to offload managerial responsibility. An amorphous and often anonymous 'shareholder pressure' became the explanation for all manner of managerial malpractice. Managers lamented the fact they had no choice but to disregard workers and other stakeholders because of shareholder power. Rhetorically, shareholders were deemed responsible for corporate problems. Yet in practice, managers, more often than not, enrolled shareholders into their own projects, using the newly-formed alliance with shareholders to pocket huge returns for themselves.

Though shareholder demands are now depicted as the problem to be solved, the same reformist voices have in the past championed shareholders as the solution to corporate excesses. This was the basis for the hope around the ' shareholder spring ' in 2012, or the recent championing of activist shareholders as ' labour's last weapon' .

By challenging the conventional narrative, we have emphasised how it is instead the financialisation of managerialism , or the way in which corporations have leveraged their operations on financial markets, that has characterised the shareholder value shift. Politically this matters.

If shareholder demands are understood to be the major problem in corporate life, then the solution is to grant executives more space. Yet the history of shareholder value tells us that managers have been leading the way in corporate governance. They do not need shielding from shareholders or anyone else and instead need to be made accountable for their decisions. Critiques of shareholder primacy risk muddying the responsibility of managers who have long put their own interests first. Perhaps the reason why executives are now so ready to abandon shareholder primacy, is because it never really existed.


vlade , November 6, 2019 at 5:11 am

Uber. WeWork. Theranos.

I rest my case.

notabanktoadie , November 6, 2019 at 5:51 am

Imagine if all corporations were equally owned by the entire population? Then shareholder primacy would just be representative democracy, no?

But, of course, corporations are not even close to being equally owned by the entire population and part of the blame must lie with government privileges for private credit creation whereby the need to share wealth and power with the entire population is bypassed – in the name of "efficiency", one might suppose.

But what good is the "efficient" creation of wealth if it engenders unjust and therefore dangerous inequality and levies noxious externalities?

Michael , November 6, 2019 at 7:59 am

"An amorphous and often anonymous 'shareholder pressure' became the explanation for all manner of managerial malpractice."

Amorphous? Anonymous? Anybody who faced one of Milken's raiders, or paid Icahn's Greenmail, would disagree. Nelson Putz, er, Peltz just forced P&G to start eating into the foundation of the business to feed his greed. There's nothing amorphous or anonymous about activist shareholders, especially when they take over a company and start carving it up like a Thanksgiving turkey.

Synoia , November 6, 2019 at 8:00 am

Shareholder primacy or Creditor Primacy?

Creditors, or bond holders, appear to be the more powerful. Shareholders have no legal recourse to protect their "ownership." Bondholders do have legal recourse.

Either way, many corporations more serve up their than serve their customers and the general public. There is this belief that if a corporation is profitable, that's good but does not include a public interest (for example Monsanto and Roundup.)

vlade , November 6, 2019 at 9:48 am

Managers used to fear the creditors more than shareholders, that's very much true.

But that has gone out of the window recently, as debt investors just chase return, so it's seller's world, and few of them (debt investors) want to take losses as they are much harder to recoup than before. So extend and pretend is well and alive.

In other words, one of the byproducts of QE is that the company management fears no-one, and is more than happy to do whatever they want.

The problem is the agency. If we assume that we want publicly traded companies (which IMO is not a given), the current incentives are skewed towards management paying themselves.

The problem with things like supervisory boards, even if they have high worker representation, is that those are few individuals, and often can be (directly or indirectly) corrupted by the management.

The "shares" incentive is just dumb, at least in the way it's currently structured. It literally gives only upside, and often even realisable in short/medium term.

d , November 6, 2019 at 4:23 pm

And thats how we got Boeing and PG&E. Just don't think thats the entire list, don't think there is enough room for that

rd , November 6, 2019 at 5:57 pm

Corporations are artificial creations of the state. They exist in their current form under a complex series of laws and regulations, but with certain privileges, such as Limited Liability Corporations. It is assumed that these creatures will enhance economic activity if they are given these privileges, but there is no natural law, such as gravity, that says these laws and regulations need to exist in their current form. They can be changed at will be legislatures.

This is why I despise the Citizens United decision which effectively gives these artificial creations the same rights as people. i don't believe that Thomas Jefferson would have found that to be "a self-evident truth." I think that Citizens United will be regarded as something akin to the Dred Scott decision a century from now.

Shareholder primacy is an assumption that hasn't been challenged over the past couple of decades, but can be controlled by society if it so desires.

Jeremy Grimm , November 6, 2019 at 11:12 am

The semantics of "shareholder primacy" are problematic. The word "shareholder" in this formula echoes the kind problems that whirl around a label like "farmer". A shareholder is often characterized in economics texts as an individual who invests money hoping to receive back dividends and capital gains in the value and valuation of a company as it earns income and grows over time. Among other changes -- changes to the US tax laws undermined these quaint notions of investment, and shareholder. The coincident moves for adding stock options to management's pay packet [threats of firing are supposed to encourage the efforts of other employees -- why do managers needs some kind of special encouragement?], legalizing share buybacks, and other 'financial innovations' -- worked in tandem to make investment synonymous with speculation and shareholders synonymous with speculators, Corporate raiders, and the self-serving Corporate looters replacing Corporate management.

This post follows a twisting road to argue previous "critique of shareholder value has always been based on a misunderstanding" and arrives at a new critique of shareholder value "challenging the conventional narrative." This post begins by sketching Stern's foundation for 'shareholder value' with the assertion imputed to him: "if management was effective, demand for the firm's stock would be high. A low price would imply bad management." The post then claims "What sounds obvious now was revolutionary at the time." But that assertion does not sound at all obvious to me. In terms of the usual framing of the all-knowing Market the assertion sounds like a tautology, built on a shaky ground of Neolilberal economic religious beliefs.

I believe "shareholder primacy" is just one of many rhetorical tools used to argue for the mechanisms our Elites constructed so they could loot Corporate wealth. There is no misunderstanding involved.

xkeyscored , November 6, 2019 at 12:07 pm

"But that assertion does not sound at all obvious to me."
I think you're severely understating this. I'd call it total [family blogging family blog]. As you go on to imply, it takes an act of pure faith, akin to religious faith in Dawkins' sense of belief in the face of evidence to the contrary, to assume or assert this nonsense, except insofar as it's tautological – if the purpose of management is to have a high share price, then obviously the latter reflects the effectiveness of the former.

Susan the Other , November 6, 2019 at 1:06 pm

Well, we're all stakeholders now. There probably isn't much value to merely being a shareholder at this point. First let's ask for a viable definition of "value" because it's pretty hard to financialize an undefined "value" and nobody can financialize an empty isolated thing like the word "management". Things go haywire. What we can do with this seed of an idea is finance the preservation and protection of some defined value. And we can, in fact, leverage a healthy planet until hell freezes over. No problem.

PKMKII , November 6, 2019 at 2:07 pm

This fits within a Marxist analysis as the material conditions spurred the ideological justifications of the conditions, not the ideology spurring the conditions.

mael colium , November 6, 2019 at 5:15 pm

Easy to bust this open by legislating against limited liability. Corporates were not always limited liability, but it was promoted as a means to encourage formation of risky businesses that would otherwise never develop due to risk averse owners or managers. This was promoted as a social compact, delivering employment and growth that would otherwise be unattainable. Like everything in life, human greed overcomes social benefits.

Governments world wide would and should step up and regulate to regain control, rather than fiddling at the margins with corporate governance regulation. They won't, because powerful vested interests will put in place those politicians who will do their bidding. Another nail in the democracy coffin. The only solution will be a cataclysmic event that unites humanity.

RBHoughton , November 7, 2019 at 12:30 am

I think about stock markets as separate from companies and I'm wrong. Each of the stock exchanges I have heard of started off when 4-5 local companies invested a few thousand each in renting a building and a manager to run an exchange hoping it would attract investment, promote their shares and pay for itself.

I remember when one of the major components of the Hong Kong Exchange, Hutchison, had a bad year and really needed some black magic to satisfy the shareholders, the Deputy Chairman abandoned his daytime job and spent trading hours buying and selling for a fortnight to contribute something respectable for the annual accounts. Somebody paid and never knew it. This was at the start of creative accounting and the 'anything goes' version of capitalism that the article connects with Litton Industries, Teledyne and LTV but was infecting the entire inner circle of the money.

[Nov 08, 2019] Hayek as a corporate prostitute

Nov 08, 2019 | www.theguardian.com

After washing out at LSE, Hayek never held a permanent appointment that was not paid for by corporate sponsors. Even his conservative colleagues at the University of Chicago – the global epicentre of libertarian dissent in the 1950s – regarded Hayek as a reactionary mouthpiece, a "stock rightwing man" with a "stock rightwing sponsor", as one put it. As late as 1972, a friend could visit Hayek, now in Salzburg, only to find an elderly man prostrate with self-pity, believing his life's work was in vain. No one cared what he had written!

[Nov 08, 2019] When trying to find a proper definition of neoliberalism, first of all we need to admit that we are discussing a yet another dead ideology

Nov 08, 2019 | crookedtimber.org

Orange Watch 11.07.19 at 5:11 pm

Donald@63 :

The tendency to scapegoat rather than make the case for one's own merit is very deeply ingrained in our top-down liberal democratic systems; the Democratic establishment is unfortunately just getting back to core principles by shifting almost exclusively to this mode of discourse over the past decade. From Guy Debord's 1988 Commentaries on the Society of the Spectacle :

This perfect democracy creates for itself its own inconceivable enemy, terrorism. In effect, it wants to be judged by its enemies moreso than by its results. The history of terrorism is written by the State; it is therefore instructive. The spectator populations certainly cannot know everything about terrorism, but they can always know enough to be persuaded that compared to terrorism, anything else must seem to be more or less acceptable, and in any case more rational and democratic.

likbez 11.08.19 at 8:21 am ( 74 )

When trying to find a proper definition of neoliberalism, first of all we need to admit that we are discussing a yet another dead ideology:
https://www.theguardian.com/news/2017/aug/18/neoliberalism-the-idea-that-changed-the-world

Three senior economists at the IMF, an organisation not known for its incaution, published a paper questioning the benefits of neoliberalism. In so doing, they helped put to rest the idea that the word is nothing more than a political slur, or a term without any analytic power. The paper gently called out a "neoliberal agenda" for pushing deregulation on economies around the world, for forcing open national markets to trade and capital, and for demanding that governments shrink themselves via austerity or privatisation. The authors cited statistical evidence for the spread of neoliberal policies since 1980, and their correlation with anaemic growth, boom-and-bust cycles and inequality.

Also when we discussing the proper definition of neoliberalism we need to remember very questionable pedigree of its founders. For example, Hayek was as close to the intellectual prostitute of financial oligarchy as one can get:

After washing out at LSE, Hayek never held a permanent appointment that was not paid for by corporate sponsors. Even his conservative colleagues at the University of Chicago – the global epicentre of libertarian dissent in the 1950s – regarded Hayek as a reactionary mouthpiece, a "stock rightwing man" with a "stock rightwing sponsor", as one put it. As late as 1972, a friend could visit Hayek, now in Salzburg, only to find an elderly man prostrate with self-pity, believing his life's work was in vain. No one cared what he had written!

Which means that one of key components in the definition of neoliberalism should be that this ideology was the project launched and supported by financial oligarchy, who felt squeezed by the New Del regulations. And its main task was to justify the return to political power of the financial oligarchy.

The more Hayek's idea expands, the more reactionary it gets, the more it hides behind its pretence of scientific neutrality – and the more it allows economics to link up with the major intellectual trend of the west since the 17th century. The rise of modern science generated a problem: if the world is universally obedient to natural laws, what does it mean to be human? Is a human being simply an object in the world, like any other? There appears to be no way to assimilate the subjective, interior human experience into nature as science conceives it – as something objective whose rules we discover by observation.

Society reconceived as a giant market leads to a public life lost to bickering over mere opinions; until the public turns, finally, in frustration to a strongman as a last resort for solving its otherwise intractable problems.

Surely there is a connection between their growing irrelevance and the election of Trump, a creature of pure whim, a man without the principles or conviction to make for a coherent self.

likbez 11.08.19 at 8:29 am ( 75 )
Your comment is awaiting moderation.

Dani Rodrik on neoliberalism:
https://www.theguardian.com/news/2017/nov/14/the-fatal-flaw-of-neoliberalism-its-bad-economics

Economists study a social reality that is unlike the physical universe. It is completely manmade, highly malleable and operates according to different rules across time and space. Economics advances not by settling on the right model or theory to answer such questions, but by improving our understanding of the diversity of causal relationships.

Neoliberalism and its customary remedies – always more markets, always less government – are in fact a perversion of mainstream economics. Good economists know that the correct answer to any question in economics is: it depends.

[Nov 08, 2019] Neoliberalism's Children Rise Up to Demand Justice in Chile and the World by Medea Benjamin and Nicolas J. S. Davies

Notable quotes:
"... When Chile's socialist leader Salvador Allende was elected in 1970, after a 6-year-long covert CIA operation to prevent his election, President Nixon ordered U.S. sanctions to " make the economy scream ." ..."
"... U.S. sabotage of the new government intensified, and on September 11th, 1973, Allende was overthrown in a CIA-backed coup. The new leader, General Augusto Pinochet, executed or disappeared at least 3,200 people, held 80,000 political prisoners in his jails and ruled Chile as a brutal dictator until 1990, with the full support of the U.S. and other Western governments. ..."
"... The Chicago Boys pointed to rising economic growth rates in Chile as evidence of the success of their neoliberal program, but by 1988, 48% of Chileans were living below the poverty line. Chile was and still is the wealthiest country in Latin America, but it is also the country with the largest gulf between rich and poor. ..."
"... The governments elected after Pinochet stepped down in 1990 have followed the neoliberal model of alternating pro-corporate "center-right" and "center-left" governments, as in the U.S. and other developed countries. Neither respond to the needs of the poor or working class, who pay higher taxes than their tax-evading bosses, on top of ever-rising living costs, stagnant wages and limited access to voucherized education and a stratified public-private healthcare system. Indigenous communities are at the very bottom of this corrupt social and economic order. Voter turnout has predictably declined from 95% in 1989 to 47% in the most recent presidential election in 2017. ..."
Nov 07, 2019 | dissidentvoice.org
Uprisings against the corrupt, generation-long dominance of neoliberal "center-right" and "center-left" governments that benefit the wealthy and multinational corporations at the expense of working people are sweeping country after country all over the world.

In this Autumn of Discontent, people from Chile, Haiti and Honduras to Iraq, Egypt and Lebanon are rising up against neoliberalism, which has in many cases been imposed on them by U.S. invasions, coups and other brutal uses of force. The repression against activists has been savage, with more than 250 protesters killed in Iraq in October alone, but the protests have continued and grown. Some movements, such as in Algeria and Sudan, have already forced the downfall of long-entrenched, corrupt governments.

A country that is emblematic of the uprisings against neoliberalism is Chile. On October 25, 2019, a million Chileans -- out of a population of about 18 million -- took to the streets across the country, unbowed by government repression that has killed at least 20 of them and injured hundreds more. Two days later, Chile's billionaire president Sebastian Piñera fired his entire cabinet and declared, "We are in a new reality. Chile is different from what it was a week ago."

The people of Chile appear to have validated Erica Chenoweth's research on non-violent protest movements, in which she found that once over 3.5% of a population rise up to non-violently demand political and economic change, no government can resist their demands. It remains to be seen whether Piñera's response will be enough to save his own job, or whether he will be the next casualty of the 3.5% rule.

It is entirely fitting that Chile should be in the vanguard of the protests sweeping the world in this Autumn of Discontent, since Chile served as the laboratory for the neoliberal transformation of economics and politics that has swept the world since the 1970s.

When Chile's socialist leader Salvador Allende was elected in 1970, after a 6-year-long covert CIA operation to prevent his election, President Nixon ordered U.S. sanctions to " make the economy scream ."

In his first year in office, Allende's progressive economic policies led to a 22% increase in real wages, as work began on 120,000 new housing units and he started to nationalize copper mines and other major industries. But growth slowed in 1972 and 1973 under the pressure of brutal U.S. sanctions, as in Venezuela and Iran today.

U.S. sabotage of the new government intensified, and on September 11th, 1973, Allende was overthrown in a CIA-backed coup. The new leader, General Augusto Pinochet, executed or disappeared at least 3,200 people, held 80,000 political prisoners in his jails and ruled Chile as a brutal dictator until 1990, with the full support of the U.S. and other Western governments.

Under Pinochet, Chile's economy was submitted to radical "free market" restructuring by the " Chicago Boys ," a team of Chilean economics students trained at the University of Chicago under the supervision of Milton Friedman for the express purpose of conducting this brutal experiment on their country. U.S. sanctions were lifted and Pinochet sold off Chile's public assets to U.S. corporations and wealthy investors. Their program of tax cuts for the wealthy and corporations, together with privatization and cuts in pensions, healthcare, education and other public services, has since been duplicated across the world.

The Chicago Boys pointed to rising economic growth rates in Chile as evidence of the success of their neoliberal program, but by 1988, 48% of Chileans were living below the poverty line. Chile was and still is the wealthiest country in Latin America, but it is also the country with the largest gulf between rich and poor.

The governments elected after Pinochet stepped down in 1990 have followed the neoliberal model of alternating pro-corporate "center-right" and "center-left" governments, as in the U.S. and other developed countries. Neither respond to the needs of the poor or working class, who pay higher taxes than their tax-evading bosses, on top of ever-rising living costs, stagnant wages and limited access to voucherized education and a stratified public-private healthcare system. Indigenous communities are at the very bottom of this corrupt social and economic order. Voter turnout has predictably declined from 95% in 1989 to 47% in the most recent presidential election in 2017.

If Chenoweth is right and the million Chileans in the street have breached the tipping point for successful non-violent popular democracy, Chile may be leading the way to a global political and economic revolution.

Medea Benjamin is cofounder of CODEPINK for Peace , and author of several books, including Inside Iran: The Real History and Politics of the Islamic Republic of Iran . Nicolas J. S. Davies is an independent journalist, a researcher with CODEPINK and the author of Blood On Our Hands: the American Invasion and Destruction of Iraq . Read other articles by Medea Benjamin and Nicolas J. S. Davies .

This article was posted on Thursday, November 7th, 2019 at 1:39am and is filed under Chile , CIA , Haiti , Honduras , Neoliberalism , President Sebastian Piñera , Protests .

[Nov 08, 2019] More Evidence that The Comey FBI was a Malevolent Clown Show by Larry C Johnson - Sic Semper Tyrannis

Nov 08, 2019 | turcopolier.typepad.com

Brent , 06 November 2019 at 03:04 PM

From what I have read, I gather that the FBI in the Mueller / Comey era has made extensive use of "perjury traps". They then threaten charges to get someone to "flip" on someone bigger, in this case Trump. Flynn wouldn't flip even when they threatened to go after Flynn's son. So they decided to "F" him, as stated by Andrew McCabe.

The FBI has been thoroughly disgraced, and Wray is incapable of cleaning it up. He just wants to keep the dirt under the rug. It is too late for that, it is all coming out. US citizens deserve to know how dirty our FBI and CIA are - they are criminal organizations.

Factotum said in reply to Brent ... , 06 November 2019 at 05:45 PM
I am reminded of Susan MacDougall in the Clinton Whitewater case, decades ago -she claimed "they' were trying to make her flip too - can't remember who was on which side, but was it also government prosecutors against a vulnerable individual who they had hope to break to get the goods they decided they wanted? If so, I guess we need generational reminders of the awesome and terrifying powers of an overly powerful "government".
confusedponderer -> Factotum... , 07 November 2019 at 06:35 AM
Factorum,
re: I guess we need generational reminders of the awesome and terrifying powers of an overly powerful "government".

I'd put it more precise - "the awesome and terrifying powers of ANY overly powerful "government".

If it's an Obama FBI crew getting after you or a Trump FBI crew - it must be very bad every time, guilty of anything or not.

A classic case of how really bad it can get is Brazil's evangelical Bolsonaro.

Iirc a brazilian tv station had reported that his son was likely deeply involved in the murder of a left polician or reporter in Brazil, a deed done by former brazilian cops who also happened to call Bolsonaro's house.

Bolsonaro simply freaked out and was not interested at all in any investigation or the question whether the report was accurate. He simply threatened the tv station that, when reelected, he would nullify their media license.

He showed no interrest in any reality or facts but was just trying to brutally silence and intimidate the media outlet he doesn't like.

He also suggested that his son should become Brazil's ambassador to the US. Probably a perfect job since Trump doesn't have any problems with the Saudi murder prince MbS as well.

A crook by the book ...

Fred -> confusedponderer... , 07 November 2019 at 09:37 AM
confusedponderer,

Thank goodness the German government has never done anything like this.

confusedponderer -> Fred ... , 07 November 2019 at 11:47 AM
Fred,
Thank goodness the German government has never done anything like this ?

Please enlighten me, I am curious and must have missed it - and I live in Germany.

If you want to go back to Attila, Genghis Khan, Adolf or Honnecker - please spare me since about all of that happened long before I was born (and two of those are huns or mongols) and is utterly irrelevant here.

Bolsonaro-isms on the other hand "happen right now" and are an example of pretty obvious abuse of power to cover up crimes like political murder and to permanently silence critics and/or inconvenient media.

In context of Factotum's point that is relevant.

Fred -> confusedponderer... , 07 November 2019 at 05:57 PM
Confused,

There has been plenty of abuse of government power and it doesn't all require a bullet in the back or investigators/prosecutors making false claims. I'm on the road but will write something up about that over the weekend.

Anon said in reply to Factotum... , 07 November 2019 at 01:55 PM
K.T. McFarland (whose name comes up every now and then in this matter)
has some pertinent thoughta on how the government used its power against Flynn:
"KT McFarland speaks for first time about Michael Flynn" , Fox News interview, 2019-11-05
Andrei Martyanov (aka SmoothieX12) , 06 November 2019 at 04:07 PM
Is it just me (wink, wink) but I find it completely coincidental that both Strzok (100%) and Pientka (likely) are of Polish origins. Could it be my Russian paranoia. Nah, I am being unreasonable--those people never had a bad feeling towards Trump's attempts to boost Russian-American relations with Michael Flynn spearheading this effort. Jokes aside, however, I can only imagine how SVR and GRU are enjoying the spectacle. I can only imagine how many "free" promotions and awards can be attach to this thing as a free ride.
English Outsider -> Andrei Martyanov (aka SmoothieX12) ... , 07 November 2019 at 09:19 AM
Your comment brings to mind the outdated Russophobia of many in positions of influence within the American administration.

I couldn't remember who coined the term "the crazies in the basement" as applied to the more hawkish elements in US politics. I thought it had been an American Admiral. I had no luck finding a reference so I googled it. Still no joy with the American admiral, but the list thrown up had near the top of it this informative quote from Patrick Bahzad.

"The "crazies in the basement" is an expression that was coined originally by some unknown member of George W's administration. It used to designate the small clique of Neo-Cons who had found their way into Bush junior's team of advisors, before they rose to dubious fame after the 9/11 attacks. Col. Lawrence Wilkerson, at the time Colin Powell's chief of staff, described their status enhancement from "lunatic fringe" to top executives in the White House with his Southern sense of humour, adding that they had become almost overnight what was henceforth called the Cheney "Gestapo". And what happened over the weekend in the Middle-East – and in D.C. – certainly looked like a distant but distinct reminder of that period in the early 2000s when "crazies" coming right out of a dark basement took over the policy agenda on questions that would require adult supervision."

Both in Canada and the States men and women of Eastern European background have risen to positions of influence in the respective administrations. I'd argue that that has not been uniformly beneficial. Not when those men and women enlist under the crazy banner. Or, to put it more soberly, form part of the neocon wing of those administrations. Though I, as an outside observer, might be prejudiced here because I happen not to get on very well with Brzezinski and his copious output.

Allowing for that prejudice, which I confess runs very deep, I still think that to an extent American foreign policy has been hijacked by Eastern European emigres who themselves retain some of the prejudices and mindset of another age and place.


Looking at it from afar, the influence of some Eastern European emigres on American foreign policy has been uniformly deleterious. And that from a long way back and no matter whether those emigres are in Washington or Tel Aviv.

It cannot but help be distorting, that influence. It's not merely that unexamined Russophobia is embedded in the DNA of many Eastern Europeans. There's a narrow minded focus on aggressive Machtpolitik, bred from centuries of violent territorial disputes with neighbours.

That, transferred to the world stage as it must be when it infects the foreign policy of the United States - because that is a country that cannot but help be at the centre of the world stage - distorts US foreign policy. To a great degree American foreign policy no longer operates in the interests of the broad mass of the American people. It too often plays to the obsessions inherited from Old Europe.

In the most famous of his speeches Churchill spoke of the time when, as he hoped, "the New World, with all its power and might, steps forth to the rescue and the liberation of the old."

Let the historians dispute as they will, that is what happened. And continued to happen for half a century and more. But there was a price few noticed. The New World might have stepped forward to rescue the old, but it carried back from that old world a most destructive freight.

Andrei Martyanov (aka SmoothieX12) -> English Outsider ... , 07 November 2019 at 01:04 PM
Very well put. No better example, apart from being utter academic failure, expected from "white board" theorists with zero understanding of power, exists of this than late Zbig. Only blind or sublime to the point of sheer idiocy could fail to see that Brzezinski's loyalties were not with American people, but with Poland and old Polish, both legitimate and false, anti-Russian grievances. He dedicated his life to settling whatever scores he had with historic Russia using the United States merely as a vehicle. So do many, as you correctly stated, Eastern European immigrants to the United States. They bring with them passions, of which Founding Fathers warned, and then infuse them into the American political discourse. It finally reached it peak of absurdity and, as I argue constantly, utter destruction of the remnants of the Republic.
David Habakkuk -> Andrei Martyanov (aka SmoothieX12) ... , 07 November 2019 at 01:15 PM
Andrei and EO,

I wrote what follows before reading Andrei's response to EO, but do not see much reason to change what I had written.

When in 1988 I ended up working at BBC Radio 'Analysis' programme because it was impossible to interest any of my old television colleagues in the idea that one might go to Moscow and talk to some of the people involved in the Gorbachev 'new thinking', my editor, Caroline Anstey, was an erstwhile aide to Jim Callaghan, the former Labour Prime Minister.

As a result of his involvement with the Trilateral Commission, she had a fascinating anecdote about what one of his fellow members, the former German Chancellor Helmut Schm