|May the source be with you, but remember the KISS principle ;-)|
|Contents||Bulletin||Scripting in shell and Perl||Network troubleshooting||History||Humor|
|News||Neocolonialism as financial imperialism||Recommended Links||Greece debt enslavement||Ukraine debt enslavement||Harvard Mafia, Andrei Shleifer and the economic rape of Russia||Provisional government as an instrument for Ukraine's debt enslavement|
|The Iron Law of Oligarchy||Elite Theory||Two Party System as polyarchy||Economics of Energy||Predator state||Super Imperialism||New American Militarism|
|Neoliberalism||The Grand Chessboard||Disaster capitalism||Inside "democracy promotion" hypocrisy fair||Right to protect||Merkel as Soft Cop in Neocon Offensive on Eastern Europe and Russia||Neocons|
|American Exceptionalism||Media-Military-Industrial Complex||Mayberry Machiavellians||Neo Trotskyism aka Neoconservatism||War is Racket||Neoliberal Brainwashing -- Journalism in the Service of the Powerful Few||In Foreign Events Coverage The Guardian Presstitutes Slip Beyond the Reach of Embarrassment|
|Casino Capitalism||Financial Sector Induced Systemic Instability||Political skeptic||John Kenneth Galbraith||Financial Humor||Humor||Etc|
IMF is not the agency to help other countries with the economic development. Under neoliberalism (and that means since 80th) it became the major instrument for redistributing wealth up and enslaving countries with debt that can't be repaid. As a tool for the redistribution it works extremely efficiently both on local level (producing local oligarchs) and on international level -- ensuring prosperity of G7 and USA in particular.
The U.S. economy has benefited immensely from its ability to extract tribute from other nations, including the U.S. financial community's probable engineering of crises in developing nations in order to scoop up devalued assets on the cheap. One of the most important instruments of this extraction, plunder of weaker nations, is IMF.
The standard IMF policy is to approach countries in financial crises with the same rather crude recipies that favour large Wall Street banks. In this case IMF staff acts like like vulture fund managers rather than economists. They try to force a country with a fiscal deficit to reduce government spending, privatage industries and take on additional debt. Reducing government spending reduces aggregate demand, which in turn reduces government income, and make the deficit worse. So the country need to take more loads, inflicting more pain on the population. The reason that the IMF does this, is that it is meant to "restore confidence in the markets". But once a crisis starts, foreign investors tend to bail out anyway, so all it buys the country is a small breathing space before default. Country is better off introducing strict capital controls and accepting the fact that speculative foreign investors are gone. It should not allow them to enter the market in the first place and focus on growth.
The other thing is the immense level of hypocrisy of the US administrations that control IMF, which forced policies on emerging markets, which it would never accept itself.
In fact, the IMF more or less took instructions from the US Treasury during the 1990s, and certainly my sense at the time was that some IMF staffers were very frustrated at the policies that the US government forced them to follow. The point though, is that while the US government was battling the balanced budget amendment at home, on the reasonable grounds that it limited their freedom to manage demand, they were essentially enforcing a balanced budgets on the emerging markets via IMF condition for loans. They are forcing central banks to focus only on inflation. They are forcing emerging markets to open their markets, while protecting US farmers from imports.
The economic restructuring programs imposed on poor countries has benefited U.S. and other foreign investors while creating a small but powerful class of wealthy individuals (fifth column of neoliberalisation) in China, Mexico, South Korea, Ukraine, Russia, etc.
Unsustainable level of debt creates the potentially catastrophic financial situation for those countries that take IMF loads.
Debt that can't be paid back, won't be paid back. That simple idea is the key to debt enslavement of people and nations. One of the key mechanisms is ensuring that loads to state were looted by local oligarchy, turning being eye to money laundering or, as was the case in post 1991 Russia, actively supporting money laundering as the way to decimate former opponent and drive it into vassal status.
There is a strong alliance of Western governments and local oligarchs in this dirty game with IMF serving as an enforcer of debt slavery enabling buying countries assets by transnational for penny on a dollar. Corrupt officials burden taxpayers with unsustainable amounts of debt for unproductive, grossly overpriced projects.The TPP and TTIP are integral initiatives in this effort of extending financial obligations, debt, and control.
This is why these corporatists and statists hate gold and silver, by the way. And why it is at the focal point of a currency war. It provides a counterweight to their monetary power. It speaks unpleasant truths. It is a safe haven and alternative, along with other attempts to supplant the IMF and the World Bank, for the rest of the world. So when you say, the Philippines deserved it, Iceland deserved it, Ireland deserved it, Africa deserves it, Jefferson County deserved it, Detroit deserved it, and now Greece deserves it, just keep in mind that some day soon they will be saying that you deserve it, because you stood by and did nothing.
Because when they are done with all the others, for whom do you think they come next? If you wish to see injustice stopped, if you wish to live up to the pledge of 'never again,' then you must stand for your fellows who are vulnerable. The economic hitmen have honed their skills among the poor and relatively defenseless, and have been coming closer to home in search of new hunting grounds and fatter spoils.
You may also find some information about the contemporary applications of these methods in The IMF's 'Tough Choices' On Greece by Jamie Galbraith.
The whole mechanism of debt enslavement is polished to perfection on developing countries.
Here are some relevant Amazon reviews of the book Confessions of an Economic Hit Man that discusses IMF policies since 1980th.
gordon macgregoron May 2, 2015
IMF forced lending to poor countries of sums far in excess of their needs ...
Absolutely fascinating, pulling back the veil of the inner workings of the IMF as it does. Confirms a lot of things people have long suspected and been shouted down for voicing.
Shows the IMF as an organization bent on capturing the resources of countries around the world via various highly unethical means. e.g forced lending to poor countries of sums far in excess of their needs or means, for inappropriate purposes, leading to big profits for Western firms, the beggaring of the recipient nations, and forced capture of natural resources by large corporations. Surprising that the IMF has not been subject to deep investigation by the UN after this expose.
johnnyjohnnyon April 25, 2015
learn what's going on. read this book. gives a clue to MONSANTO's model of world domination
truly a remarkable book that has been proven with events and facts that have come out since the book was written back in the day.
the model of economic control, back in the good ole days when the International Monetary Fund & U.S. congressionally funded loans to third world countries was the way to pull the strings, and get our largest corporations huge projects that third worlders didn't need and couldn't pay for...but brought the bucks home.
if you ever had a suspicion about recent wars, the billion$ they brought to large contractors, and the reason for those interventions, go back to the early days of this model of international control from someone who was there. and yes, halliburton (aka Kellogg Brown and Root back then) was involved.
James Kenney on April 1, 2015
Should I simply take him at his own word, that he is a liar?
This is a very believable book on a topic of vital importance to the world today: the extent to which "economic development aid" is designed not to benefit the target country, but to ensnare it into the global culture as a debtor nation with assets never designed to be profitable, but merely to serve as an "economic gateway drug".
Somehow, though, while the book is eminently readable, and a bit unnerving, I just couldn't shake off a feeling that I was being "had", by Mr. John Perkins. Look at the number of reviews here! Clearly, this book touched a nerve...but if the author is as unscrupulous as he claims to be (or to have been, since he also claims to have experienced a remarkable conversion, like Paul on the road to Damascus), a fundamental question arises: why should we believe him?
This question is even more essential, since many of us who would even read such a book believe in our hearts that, yes, American capitalism, aided by the IMF, and the World Bank, is seeking to enslave the world. Of course! It's almost a given, an article of faith. No wonder the rest of the world hates us!
I too felt the lure of Perkins' mesmerizing description of an unspoken conspiracy to take over the world by bankrupting it. Certainly, the events of 2008 and 2009 showed the moral bankruptcy of the Big Banks and those who cynically packaged sliced and diced debt into impossible to understand financial instruments, then peddled them to school boards and public pension plans.
Now that I come to review the book, though, I almost feel as if I should wash my hands first. Just picking it up, seeing its jaunty cover, remembering its schmaltzy "spy coming in from the cold" ending, I feel...taken in. I don't know why I feel that way, but the feeling is definitely there. There is something exploitive about this book, as if the author had not changed his skin, only his target: as if now, instead of ensnaring struggling nations, he is ensnaring readers all too willing to believe the worst about ourselves and the economic system in which we too are ensnared.
Even the title sounds phony. Perkins may well be right, he may well be telling it like it is, he may have become a champion bravely taking on a system he helped create, a modern David fighting an economic Goliath. Heavens knows, after stories of regulators sniffing cocaine off a toaster oven with those they are supposed to be regulating, nothing seems unbelievable, and in a sense this book sounds almost inevitable, natural, and important.
It may be. But one of the things I was taught as a historian, is to consider your sources, and the chief question is, how credible are they? When a self-proclaimed liar, swindler and cheat tells me the "system is rigged", should I believe him? Or should I simply take him at his own word, that he is a liar?
I gave this ugly tale 4 stars simply for readability. Fact or fiction, it is certainly that: readable.
DH Koester on March 24, 2015
Well, well, well---another piece to the puzzle as to what constitutes the United States of America!
Besides the curse of blood-stained hands from endless wars of aggression there is another sinister side to this country's quest for empire and world domination--the enslavement of countries and peoples through cleverly devised debt imposition--the same method our government uses on its own people. This debt imposition on foreign countries serves to enrich foreign rulers and US corporations while impoverishing the common people.
Perkins was one of the people--a cog in the wheel --that made it all possible and when his conscience finally got the better of him he wrote a book about it.
Students will not read about these economic hit men ion any American textbook. Nor will they, as adults, read about it in any periodical or hear about it on any newscast. Politicians will not tell them about it nor will their religious leaders. Yet there is this book by John Perkins describing the process in detail. But those in power--those responsible for this immoral conduct--will allow it to be published and made available to the public without fear of reprisal or consequences--just as they have the countless other books that have spoken truth to power detailing corruption, war-making and deceit by those in the highest offices.
Why?? Because the average citizen in this country doesn't care one iota about anything that he perceives as not directly affecting the welfare of himself or his family. That plus the fact that very few people will ever hear of or read this book. People don't read any more--they are plugged into their machines of instant gratification and get the bulk of what they think is news from inane sources such as the Letterman show. Even if some do read it, they will soon forget and move on--continuing with their mundane lives completely oblivious to the world that is suffering and burning outside their doors.
And me?? I know the truth--but even those who know the truth, they are powerless. There is nothing that can be done to stop the insanity. It is like death---Death eventually smiles at us all and the best a man can do is smile back.
I give this book 5 Stars not because it was particularly well written but because it informs in a world desperately in need of being informed. Read it if you will but with the understanding and full knowledge that the truth shall not set you free.
"And There I Was" by DH Koester
David Lupo "David Lupo" on February 21, 2015
Do you wonder why the world hates us? Read this book.
When I was in college, I took another course after Sociology 101, called Social Issues. It was a great course, eye-opening, but sad, because I learned about how skewed the world really is today. There were discussions on the Ford Pinto death-trap story, and stories about how grocery stores sell third-rate products at high prices, to keep the poor poor. There were other stories about how the corporation wields great power over the average citizen. I went to college in the 80s, long after we were told lies about the Great Oil Shortage in the 70s, when oil companies made a killing.
The book by John Perkins gives the historical background of how our government, working with the corporation has done some nasty things in recent decades to places around the globe. Economic Hit Men, and those in league with them have played national leaders against their people for the great financial gain that the US reaps. The corporation not only wields great power over the US citizen; it seeks this same control in the world. John Perkins highlights how this has played out in his corporate life, to the people that he knew.
I also notice that despite the harm he caused as an EHM, he escapes any sort of punishment, since he is spilling the beans on how the game is played, and has been played across the globe. That was a drawback. But today he is trying to do better things for the good of humanity, and that has to count for something.
White Rabbiton January 7, 2015
soft-minded lola granola platitudes
This book can be summarized in one sentence: America "forces" loans on third world countries based on inflated projections of resulting economic growth, that we know the recipient country will never be able to repay.
we then leverage their debt to strong-arm collateral benefits such as construction and service contracts (for the industry they got loans to build) or use their land for military bases, thereby increasing and securing our growing empire.
Perkins says this on every page of his 220 page book.
there is NO analysis or explanation of why development is automatically bad, and preserving rain forests and shaman lifestyles is automatically good, and even if it is good, why it is our problem, as a sovereign nation, to devote our resources to preserving other peoples' lifestyles. i am not asserting that industrial development is automatically "good," but there is simply no thoughtful analysis of the issues at all. Nor is there any nuts-and-bolts explanations of how he structured the economic deals that are supposedly so wicked.
There is just a lot of soft-minded liberal clap-trap about "using less oil; reading a book instead of going shopping; "dreaming" the world into existence; and -- you guessed it -- "shapeshifting." While I doubt any reader of a non-fiction book without pictures with "economic" in the title thinks that industrial development is an unmitigated boon, there have always been significant discrepancies in wealth throughout history, in every culture, country, and time, and there has always been tension (& disruption) in "progress" in any form.
Perhaps there are reasons for this besides the greed and evil of white european males, especially since the "haves" have not always been white or European (and sometimes not even male). Even (or especially) in underdeveloped countries, there are LOTS of people who would prefer medicine and basic sanitation to relying on shamanistic rain dances when their children are sick.
There are compelling and undeniable reasons why manual workers get paid less than highly specialized ones, and simply reiterating Marx's Communist Manifesto is not convincing to any thinking person, or to anyone who clawed their way out of those countries that tried to implement his pipe dream. Reminds me of the rebels' kvetching in Monty Python's Life of Brian: "Well, except for the roads, and the aqueducts, and education, and bread, and medicine, and peace, and security, what else have the Romans done for us?"
A. Kumaron January 1, 2015
Read it to get a general idea of aid programs but discard personal anecdotes as fiction
The book is clearly a combination of fact and fiction. The facts are based on the well known criticisms of the IMF and World Bank and how they have destroyed various countries. The fiction part is where the author speaks of personal experiences.
Two points give away the fact that the book is semi-fiction. The first is that the author has only used criticisms that were already made on the internet at the time of publication of the book. The second is that the author subconsciously projects his political biases based on his country's Republican vs. Democrat politics and selectively attacks Republicans while letting off the Democrats. Thus, Nixon, Reagan and the Bushes are villains while Jimmy Carter is a hero and American interference in foreign economies during the Clinton era is completely missing from the book. This despite the fact that the era of globalization and the creation of WTO and foisting the American agenda through WTO happened during the Clinton regime and Jimmy Carter started the Iran-Iraq war. Clinton was also responsible for the war on Yugoslavia which lasted all through the 1990s.
The author's list of heroes is also selective and are Communists from Latin America. He is also selective in his list of villains. Bechtel and Halliburton come in for criticism just like on the internet. And just like on the internet, there is no criticism of defense contractors whose executives support the Democratic Party. So you won't see much criticism of Raytheon or Northrop Grumman.
Most of the criticism of the aid programs was well known especially in Latin America and India. In 2000, the combination of the Seattle protests against WTO and the fact that the internet was new made the information become popular. The author seems to have picked up on that data and written a book. There is also a touch of self-delusion that it is the White man's burden to save the world. Whether it is Indonesia or Panama, there is always a character in the book who appeals to the White hero and says he will show him a side of the country that only the locals have access to and that the Whites must somehow fix it. In no country do the locals lack self-respect that they will actually indulge in such behavior.
That said, writing a first person account is an innovative idea and the author is not wrong in highlighting the true nature of aid programs. The book is successful in conveying the general idea that aid programs exist to help the American corporations. The public needs to know this sort of information and the author has done a good job at it.
Margaret M. Pratton December 14, 2014
It's amazing he's still alive to tell his tale
It's amazing he's still alive to tell his tale! John Perkins is quite frank about how he became an 'economic hit man', producing inflated optimistic economic data to persuade leaders in foreign countries to invest in building up their infrastructure (think dams, etc.) through loans they will never be able to pay back, how US industries profit through this, and his own complicity for quite a few years.
And then his slow change of heart when he began to face the actual effect of his contribution to the downward spiral of these countries. It's a real eye-opener. And yes, it does matter who's President.
Malcolm McIntyre, on October 16, 2014
Groundbreaking, although naive on the role of conspiracy
BOOK REVIEW: Confessions of an Economic Hit Man, by John Perkins
“Economic hit men are highly paid professionals who cheat countries around the globe out of trillions of dollars [through the perversion of foreign aid funds … using] fraudulent financial reports, rigged elections, payoffs, extortion, sex, and murder. They play a game as old as empire, but one that has taken on new and terrifying dimensions during this time of globalisation.”
This book is a decade old and the activities that Perkins exposes have become widely known since 2004, for which his work shares much of the credit. It remains a valuable primer for anyone seeking to understand current international events; and will reward greatly even those already aware of the casual criminality of the U.S.’s political, financial and business elites.
Perkins’ career as an economic hit man (EHM) began in 1971 and ended in 1980, after his conscience prevailed. It was sandwiched between a Peace Corps stint in the jungles of South America and a post-EHM career which included establishing a successful alternative energy company. He wrote the passage at the head of this review in 1982, but was persuaded not to go ahead with the book at that time. Four more delays were occasioned by threats or bribes.
So, how does an Economic Hit Man operate? “We are an elite group of men and women who utilize international financial organisations to foment conditions that make other nations subservient to the corporatocracy running our biggest corporations, our government, and our banks. Like our counterparts in the Mafia, EHMs provide favors. These take the form of loans to develop infrastructure – electric generating plants, highways, ports, airports, or industrial parks.
“A condition of such loans is that engineering and construction companies from our own country must build all these projects. In essence, most of the money never leaves the United States; it is simply transferred from banking offices in Washington to engineering offices in New York, Houston, or San Francisco.
“Despite the fact that the money is returned almost immediately to corporations that are members of the corporatocracy (the creditor), the recipient country is required to pay it all back, principal plus interest. If an EHM is completely successful, the loans are so large that the debtor is forced to default on its payments after a few years. When this happens, then like the Mafia we demand our pound of flesh.
“This often includes one or more of the following: control over United Nations votes, the installation of military bases, or access to precious resources such as oil or the Panama Canal. Of course, the debtor still owes us the money – and another country is added to our global empire.”
Perkins is not anti-American, but rather one of the diminishing remnant of Americans who believe the U.S. Constitution still means something. “The longer version [of why he finally wrote the book] relates to my dedication to the country where I was raised, to my love of the ideals expressed by our Founding Fathers, to my deep commitment to the American republic that today promises ‘life, liberty, and the pursuit of happiness’ for all people, everywhere, and to my determination after 9/11 not to sit idly by any longer while EHMs turn that republic into a global empire.”
Having finally got around to reading Confessions of an Economic Hit Man, I will certainly be following up with his 2008 The Secret History of the American Empire: The Truth About Economic Hit Men, Jackals, and How to Change the World and 2011’s Hoodwinked: An Economic Hit Man reveals why the global economy imploded – and how to fix it. One area of interest will be whether his understanding of conspiracy – or, more accurately in terms of Confessions, lack of conspiracy – has changed.
“Some would blame our current problems on an organised conspiracy. I wish it were so simple. Members of a conspiracy can be rooted out and brought to justice,” he says in the preface. “This system, however, is fuelled by something far more dangerous than conspiracy. It is driven not by a small band of men but by a concept that has become accepted as gospel: the idea that all economic growth benefits humankind and that the greater the growth, the more widespread the benefits.”
This idea of the concept of benefit for humankind driving the agenda is a somewhat naïve construction. The reality is that there is a relatively small band of psychopathic men (more women in the gang these days and they are no prettier) driving the agenda. The “benefit for mankind” schtick is merely one of the concepts used in their propaganda.
“The corporatocracy is not a conspiracy, but its members do endorse common values and goals,” Perkins says, adding shortly after: “People like me are paid outrageously high salaries to do the system’s bidding. If we falter, a more malicious form of hit man, the jackal, steps to the plate. And if the jackal fails, then the job falls to the military.”
The United States has 40,000 troops in Germany and 50,000 in Japan – they are still occupied countries, more than half a century after World War 2. The U.S. has more than 600 overseas bases. Wikipedia can usually be relied upon in simple matters such as this http://en.wikipedia.org/wiki/United_States_military_deployments although not in more sensitive matters which attract hasbara and intelligence operatives to the editing function. Also worth a read are http://www.globalresearch.ca/the-worldwide-network-of-us-military-bases/5564 and http://www.politifact.com/truth-o-meter/statements/2011/sep/14/ron-paul/ron-paul-says-us-has-military-personnel-130-nation/
Other than the EHM books mentioned so far, Perkins has written several about spiritual/indigenous matters, based on his experiences before and after his Hit Man service. They are listed at his web site http://www.johnperkins.org/books/
I found out more than I really wanted to know.
CWOK: Ex-Navy, on October 15, 2014
Dubious " Confessions "...
I just finished reading, " Confessions of an Economic Hit Man ", by John Perkins, in which the author recounts his alleged career as an ` Economic Hit Man ` (He uses the abbreviation ` EHM `) for a major corporation, exploiting the resources and people of under-developed countries for the financial gain of his company, with the support, or at least acquiescence, of the US Government, from the early 1970's until after the SEP 11 2001, when he finally wrote a book which includes descriptions about alleged ' black 'operations that occurred all over the world, including: Iran, Iraq, Indonesia, Panama, Ecuador, Saudi Arabia, & Colombia.
To be clear, I am NOT making a judgment as to the ultimate truth regarding all of the historical events referenced in Perkins's book, or all the allegations surrounding them.
However, I myself have experience in Investigative and Intelligence Work, and so my focus is Perkins's representation that he has First-Hand Knowledge of these historical events himself, and how this representation affects his own credibility:
* Perkins asserts that the Central Intelligence Agency was responsible for the deaths of at least two Latin-American leaders, " ...in a series of CIA Assassinations... (p. 161), during the Reagan-Bush Administrations of the 1980's.
Yet his source for this claim is John Dean's 1973 Watergate testimony, despite the fact that this testimony occurred BEFORE either Reagan or Bush took office (George H.W. Bush did serve under then President Nixon, but did not become head of the CIA until after Nixon left office, and Perkins presents ZERO evidence that Bush himself was ever involved in any such plot.)
Moreover, Perkins does not state anywhere in " Confessions " that he ever had any direct contact with the CIA at any time at all, & so what First-Hand Knowledge of the CIA's activities could Perkins possibly have?
* Perkins repeatedly-and frustratingly-makes vague, unattributed, & unverifiable statements such as:
" ...The EHM presence was very strong in Baghdad during the 1980's... "
* Yet despite both the gravity, and the number, of Perkins's claims, he still provides ZERO documentation of his own to corroborate any of them (merely a copy of his professional resume from the 1970's).
Of the MANY books and accounts that I have read involving the topic of international intrigue, this is the ONLY one with such a glaring omission.
Perkins instead lists his sources as previously written books and articles from news magazines, which he appears to have had no personal involvement with himself.
* Perhaps most telling of all, Perkins states how early on in his career as an EHM, he felt guilty about the ` Corrupt ` system that he was a part of.
Yet despite this supposed guilt, he STAYED in that ` Corrupt ` system, AND accepted all the benefits that came with it; Money, Women, Perks, Etc., AND stayed silent about it, for 30 years!
Perkins states his reasons/justifications/rationalizations/excuses as to why he STAYED in that ` Corrupt ` system, AND accepted all the benefits that came with it; Money, Women, Perks, Etc., AND stayed silent about it, for 30 years.
But, regardless, he nevertheless STAYED in that ` Corrupt ` system, AND accepted all the benefits that came with it; Money, Women, Perks, Etc., AND stayed silent about it, for 30 years!
This becomes all the more troubling because, according to Perkins's own statistics, 24,000 people die each day due to hunger (P. 192)!
IF this is true, then Perkins himself took all that blood-money, for all those years, while knowingly and silently acquiescing to the deaths of BILLIONS of people!!!
Therefore, based on my own professional experience in Investigative and Intelligence Work, it is my opinion that Perkins has NOT established that he is credible.
Until he does so, I regard Perkins's book not as a true autobiography, but rather an historical novel, in which Perkins uses some actual events as the bare bones, on which he adds a LOT of fiction.
Amazon Customer, on September 11, 2014
Americorp and the dictatorship kept us illiterate and very poor. We also lost many young lives fighting this ...
I am from Nicaragua and breathed and lived the consequences of the acts of these Economic Hit Men. We had a dictatorship put in place by the US, Inc.on my country for more than 40 years.
'Americorp" had the full access to our resources, one of them gold, we never saw the benefits of this gold. Americorp and the dictatorship kept us illiterate and very poor. We also lost many young lives fighting this dictatorship because it refused to give us the choice of electing who we wanted to lead us. It was until 1979 when the USA finally gave up supporting the dictatorship, not because of our lost of lives but because the dictator became an embarrassment to US, Inc. just like Noriega, Saddam, etc.
Very true though is the fact that the opposition was mostly supported by the USSR and Cuba.
Also very true is that the Sandinistas did not believe in property rights and believe everything belongs to the State. we went from Satan's arms to the Devil's bed.
Sucks being a poor underdeveloped nation with vultures waiting to pounce around you and tear out your eyes. Love the American People, hate its foreign policy which they are mostly kept blinded by propaganda.
Prissyon July 7, 2014
The Ugly Truth of Corporate America and Government's incestuous plan for Globalization
I've meant to read this book for years...the irony is I downloaded on Kindle while in Latin America and read it all the way through. I always suspected (from my own experience spending time on the Hill, knowing journalists, bankers, etc) this stuff went on. But Perkins fills in all the missing pieces.
I'm literally sick that I have a degree in American criminal justice and this book goes against everything I was taught of how "this country" operates. It may have come as a shock to have the dirty details to me, but my Latin American friends have known these empire building ways all along, because they've lived with it all of their lives.
I hope one thing people take away from this book are Perkins suggestions to begin at the grass roots level (school boards, county commissioners, etc) to change the way we do business and speak out when you know the truth. This is the raw, ugly truth, dear readers. I'm still attempting to digest what I know in my heart of hearts is that I have been fighting corruption of those who sugar coat it and when its pointed out, will do everything they can to disparage your credibility, no matter how impeccable it is or how well you present it. Hiring a private company to get around government checks and balances (not that there are that many) only makes sense from a globalists point of view.
Don't sit there-DO something, anything...I know- I sat out of the fray for a long time, it IS easier. But that's the coward's way out and the founding father's were anything but that. Remember, we are supposed to be the home of the brave. Are you right or left? I'd rather be active, accurate and correct...
Greece story is another classic of neoliberal debt enslavement: first corrupt neoliberal government (in case of Greece successive governments) got loans that were partially stolen, partially wasted, enriching top 1% of the country and improving living conditions of the top 20%. Then those loans from private banks were converted into public debt by attempt to save insolvent banks. And when the next wave of crisis occurred due to Greece inability to service those (now state) loans without drastic reduction of standard of living of most of the population IMF acts as enforcer. It now essentially dictates what should be done in Greece economy. No matter if previous recommendation led to disastrous consequences.
European neoliberal elite headed by Merkel is threatening to expel Greece from the Euro zone, scaring voters. It is very important to understand that anti-crisis policies have two main approaches – cyclical and counter-cyclical. The neo-liberals response is always "only wellbeing of banks matters"
Neoliberals key postulate is that the "invisible hand" of the market works better than government regulation, then the government should allow the market to work independently. The only think government should do is to balance the budget by slashing spending synchronously with falling revenues. Which led in cas of Greece to 60% unemployment among young people.
In other word "the invisible hand" does not work and instead country is sliding in real debt slavery when load became permagreen and interest will be paid forever. Forecasts of neoliberal institutions such as IMF that austerity will allow Greece to pay debts, were not justified.
Countercyclical stabilization policy is based on the opposite basis: with the reduction of budget revenues not need to cut spending in order to reduce the current deficit, but rather to increase them, thereby increasing the tax base, and along with receiving political support from the population. This should be done considering all the risks carefully assessing the consequences. The trouble is that in specific Greek terms it also doesn't work very well.
Even of part of the debt was written off by the creditors, if you can't grow the real economy, the budget crisis will be renewed. But the Greek industry was killed by accession to the EU. It was decided by EU brass that the specialization of southern Europe within Europe United should be the services sector. If this was somehow forgotten that in services industries (primarily tourism) tax collection is much lower than in industry and agriculture. Demands of the "Troika" to increase taxes on the tourism industry will lead to the withdrawal of this sector into the shadows, or to the ruin of a vast number of small and medium enterprises. If you go with the demands of Brussels and reduce subsidies to agriculture (and this was one of the main requirements of the latest Memorandum of the Troika) the destruction of the economy will be complete.
And while the entire Greek economy is suffering from a terrible level of unemployment, and German Chancellor Angela Merkel said that the borders are open, so Greeks can compete for low paid jobs in Germany. In other words, Greece has to spend money on the education of engineers, scientists and other high-demand in the EU professionals, but to find word they need have to go to Germany and most end working as janitors and other low paid jobs. Greece which spend a lot of public money to train those professionals will be left our, and all the benefits from this get more developed countries. This is actually explicit policy of the EU, which consider Southern countries to be EU "village".
Increase of exports in the current circumstances is a very difficult undertaking. It is impossible to increase export to Russia where there is some space for Greek products, as the EU has declared sanctions. That means that he crisis is expanding, and within the framework imposed on Greece anti-crisis policy there is no light at the end of the tunnel.
Cuts in public expenditure will inevitably lead to a reduction in domestic demand for the products of national industry and national agriculture. Besides falling living standards, the reduction of pensions and salaries in the public sector will be a big hit for the most vulnerable part of the population: two-thirds of Greek pensioners are already living below the poverty line.
Five months of fruitless negotiations, a new government understood that Greek people will not forgive the capitulation to EU demands. Another "cannibalistic" austerity program. So it announced the referendum on the adoption of the requirements of the Troika, shifting the responsibility for making decisions to ordinary Greeks. Still not very clear whether the Cabinet is really to declare a default, or this is only a means of pressure on the Troika. In the end, in politics the most important things is to remain in power and if Greeks vote Yes to EU demands that the end of the current government. What will happen to the country next is unclear. Probably the parties that brought the country to the current collapse (PASOK and New democracy) will return to power helped by Brussels neoliberals, who can throw a bone to them in a form of some minor compromises, compromise to which they would never agree with the current government, which is considered to be "hostile" by neoliberal stooges which now want the regime change in Greece.
But the mere decision to go the referendum caused in shakeup and hysteria in all centers of neoliberal power such as Brussels, Berlin and Washington. However, we cannot exclude that such a reaction is a mean to increase the pressure on Tsipras.As Neil Irwin's in his at The Upshot column (NYT, June 28, 2015) noted
Greek leaders think the offer on the table from European governments and the International Monetary Fund is lousy, requiring still more pension cuts and tax increases in a depressed economy, and intend to throw to voters the question of whether to accept it.
spartacus, July 1, 2015 at 1:26 pm
I think things are a little more complicated than that. According to the preliminary report of the commission set up by the Greek government to look into the origins of this debt, it appears that a big chunk of it is a consequence of the government stepping in to recapitalize troubled banks. Then the report also mentions excessive and unjustified military spending, loss of tax revenues due to illicit capital outflows. The report can be accessed via this link:
The problem is that after so much austerity the debt now stands at 177% of GDP, higher than ever, because GDP took a little bit of a nosedive. The Troika recipe for success was crap.
The “lazy Greek” line is just that. A line peddled by the MSM in order to demonize the Greek people, as opposed to the “hard working” Germans. If you look at the OECD statistic provided by the following link, you will see that, in reality, the exact opposite is true.
This is not about lavish lifestyle. Is about starvation, homelessness and suicide.
July 1, 2015 at 2:28 pm
Greece was screwed over by foremost the Germans. The whole German shtick of pretending to have “fed Greece” is grotesque obscenity.
Greek government-debt crisis - Wikipedia, the free encyclopedia
Charges of hypocrisy
Hypocrisy has been alleged on multiple bases. "Germany is coming across like a know-it-all in the debate over aid for Greece", commented Der Spiegel, while its own government did not achieve a budget surplus during the era of 1970 to 2011, although a budget surplus indeed was achieved by Germany in all three subsequent years (2012–2014). A Bloomberg editorial, which also concluded that "Europe's taxpayers have provided as much financial support to Germany as they have to Greece", described the German role and posture in the Greek crisis thus:
In the millions of words written about Europe's debt crisis, Germany is typically cast as the responsible adult and Greece as the profligate child. Prudent Germany, the narrative goes, is loath to bail out freeloading Greece, which borrowed more than it could afford and now must suffer the consequences. [… But] irresponsible borrowers can't exist without irresponsible lenders. Germany's banks were Greece's enablers.
German economic historian Albrecht Ritschl describes his country as "king when it comes to debt. Calculated based on the amount of losses compared to economic performance, Germany was the biggest debt transgressor of the 20th century." Despite calling for the Greeks to adhere to fiscal responsibility, and although Germany's tax revenues are at a record high, with the interest it has to pay on new debt at close to zero, Germany still missed its own cost-cutting targets in 2011, and also fell behind on its goals for 2012.
There have been widespread accusations that Greeks are lazy, but analysis of OECD data shows that the average Greek worker puts in 50% more hours per year than a typical German counterpart, and the average retirement age of a Greek is, at 61.7 years, older than that of a German.
US economist Mark Weisbrot has also noted that while the eurozone giant's post-crisis recovery has been touted as an example of an economy of a country that "made the short-term sacrifices necessary for long-term success", Germany did not apply to its economy the harsh pro-cyclical austerity measures that are being imposed on countries like Greece, In addition, he noted that Germany did not lay off hundreds of thousands of its workers despite a decline in output in its economy but reduced the number of working hours to keep them employed, at the same time as Greece and other countries were pressured to adopt measures to make it easier for employers to lay off workers. Weisbrot concludes that the German recovery provides no evidence that the problems created by the use of a single currency in the eurozone can be solved by imposing "self-destructive" pro-cyclical policies as has been done in Greece and elsewhere.
Arms sales are another fountainhead for allegations of hypocrisy. Dimitris Papadimoulis, a Greek MP with the Coalition of the Radical Left party:
If there is one country that has benefited from the huge amounts Greece spends on defence it is Germany. Just under 15% of Germany's total arms exports are made to Greece, its biggest market in Europe. Greece has paid over €2bn for submarines that proved to be faulty and which it doesn't even need. It owes another €1bn as part of the deal. That's three times the amount Athens was asked to make in additional pension cuts to secure its latest EU aid package. […] Well after the economic crisis had begun, Germany and France were trying to seal lucrative weapons deals even as they were pushing us to make deep cuts in areas like health. […] There's a level of hypocrisy here that is hard to miss. Corruption in Greece is frequently singled out as a cause for waste but at the same time companies like Ferrostaal and Siemens are pioneers in the practice. A big part of our defence spending is bound up with bribes, black money that funds the [mainstream] political class in a nation where governments have got away with it by long playing on peoples' fears.
Thus allegations of hypocrisy could be made towards both sides: Germany complains of Greek corruption, yet the arms sales meant that the trade with Greece became synonymous with high-level bribery and corruption; former defence minister Akis Tsochadzopoulos was gaoled in April 2012 ahead of his trial on charges of accepting an €8m bribe from Germany company Ferrostaal. In 2000, the current German finance minister, Wolfgang Schäuble, was forced to resign after personally accepting a "donation" (100,000 Deutsche Mark, in cash) from a fugitive weapons dealer, Karlheinz Schreiber.
Another is German complaints about tax evasion by moneyed Greeks. "Germans stashing cash in Switzerland to avoid tax could sleep easy" after summer 2011, when "the German government […] initialled a beggar-thy-neighbour deal that undermine[d] years of diplomatic work to penetrate Switzerland's globally corrosive banking secrecy." Nevertheless, Germans with Swiss bank accounts were so worried, so intent on avoiding paying tax, that some took to cross-dressing, wearing incontinence diapers, and other ruses to try and smuggle their money over the Swiss–German border and so avoid paying their dues to the German taxman. Aside from these unusual tax-evasion techniques, Germany has a history of massive tax evasion: a 1993 ZEW estimate of levels of income-tax avoidance in West Germany in the early 1980s was forced to conclude that "tax loss [in the FDR] exceeds estimates for other countries by orders of magnitude." (The study even excluded the wealthiest 2% of the population, where tax evasion is at its worst). A 2011 study noted that, since the 1990s, the "effective average tax rates for the German super rich have fallen by about a third, with major reductions occurring in the wake of the personal income tax reform of 2001–2005."
Alleged pursuit of national self-interestListen to many European leaders—especially, but by no means only, the Germans—and you'd think that their continent's troubles are a simple morality tale of debt and punishment: Governments borrowed too much, now they're paying the price, and fiscal austerity is the only answer.
"An Impeccable Disaster"
Paul Krugman, 5 November 2013
Since the euro came into circulation in 2002—a time when the country was suffering slow growth and high unemployment—Germany's export performance, coupled with sustained pressure for moderate wage increases (German wages increased more slowly than those of any other eurozone nation) and rapidly rising wage increases elsewhere, provided its exporters with a competitive advantage that resulted in German domination of trade and capital flows within the currency bloc. As noted by Paul De Grauwe in his leading text on monetary union, however, one must "hav[e] homogenous preferences about inflation in order to have a smoothly functioning monetary union." Thus Germany broke what the Levy Economics Institute has called "the golden rule of a monetary union" when it jettisoned a common inflation rate.
The violation of this golden rule led to dire imbalances within the eurozone, though they suited Germany well: the country's total export trade value nearly tripled between 2000 and 2007, and though a significant proportion of this is accounted for by trade with China, Germany's trade surplus with the rest of the EU grew from €46.4 bn to €126.5 bn during those seven years. Germany's bilateral trade surpluses with the peripheral countries are especially revealing: between 2000 and 2007, Greece's annual trade deficit with Germany nearly doubled, from €3 bn to €5.5 bn; Italy's more than doubled, from €9.6 bn to €19.6 bn; Spain's well over doubled, from €11 bn to €27.2 bn; and Portugal's more than quadrupled, from €1 bn to €4.2 bn. German banks played an important role in supplying the credit that drove wage increases in peripheral eurozone countries like Greece, which in turn produced this divergence in competitiveness and trade surpluses between Germany and these same eurozone members.
Germans see their government finances and trade competitiveness as an example to be followed by Greece, Portugal and other troubled countries in Europe, but the problem is more than simply a question of southern European countries emulating Germany. Dealing with debt via domestic austerity and a move toward trade surpluses is very difficult without the option of devaluing your currency, and Greece cannot devalue because it is chained to the euro. Roberto Perotti of Bocconi University has also shown that on the rare occasions when austerity and expansion coincide, the coincidence is almost always attributable to rising exports associated with currency depreciation. As can be seen from the case of China and the US, however, where China has had the yuan pegged to the dollar, it is possible to have an effective devaluation in situations where formal devaluation cannot occur, and that is by having the inflation rates of two countries diverge. If inflation in Germany is higher than in Greece and other struggling countries, then the real effective exchange rate will move in the strugglers' favour despite the shared currency. Trade between the two can then rebalance, aiding recovery, as Greek products become cheaper. Paul Krugman estimated that Spain and other peripherals would need to reduce their 2012 price-levels relative to Germany by around 20 percent to become competitive again:
If Germany had 4 percent inflation, they could do that over 5 years with stable prices in the periphery—which would imply an overall eurozone inflation rate of something like 3 percent. But if Germany is going to have only 1 percent inflation, we're talking about massive deflation in the periphery, which is both hard (probably impossible) as a macroeconomic proposition, and would greatly magnify the debt burden. This is a recipe for failure, and collapse.
This view, that German deficits are a crucial factor in assisting eurozone recovery, is shared by leading economics commentators, by the OECD, the Carnegie Endowment for International Peace, Deutsche Bank, Credit Suisse, Standard & Poor's, the European Commission, and the IMF. The Americans, too, asked Germany, repeatedly and heatedly, to loosen fiscal policy, though without success. This failure led to the US taking a more high-powered tack: for the first time, the Treasury Department, in its semi-annual currency report for October 2013, singled out Germany as the leading obstacle to economic recovery in Europe.
Therefore, it is argued, the problem is Germany continuing to shut off this adjustment mechanism. "The counterpart to Germany living within its means is that others are living beyond their means", agreed Philip Whyte, senior research fellow at the Centre for European Reform. "So if Germany is worried about the fact that other countries are sinking further into debt, it should be worried about the size of its trade surpluses, but it isn't."
This chorus of criticism, however, germinates in the very poorest of soil because, in October 2012, Germany chose to legislate against the very possibility of stimulus spending, "by passing a balanced budget law that requires the government to run near-zero structural deficits indefinitely." OECD projections of relative export prices—a measure of competitiveness—showed Germany beating all euro zone members except for crisis-hit Spain and Ireland for 2012, with the lead only widening in subsequent years.
Even with such policies, Greece and other countries would have faced years of hard times, but at least there would be some hope of recovery. During 2012, it seemed as though the status quo was beginning to change as France began to challenge German policy, and even Christine Lagarde called for Greece to at least be given more time to meet bailout targets. Further criticism mounted in 2013: a leaked version of a text from French president Francois Hollande's Socialist Party openly attacked "German austerity" and the "egoistic intransigence of Mrs Merkel"; Manuel Barroso warned that austerity had "reached its limits"; EU employment chief Laszlo Andor called for a radical change in EU crisis strategy—"If there is no growth, I don't see how countries can cut their debt levels"—and criticised what he described as the German practice of "wage dumping" within the eurozone to gain larger export surpluses; and Heiner Flassbeck (a former German vice finance minister) and economist Costas Lapavitsas charged that the euro had "allowed Germany to 'beggar its neighbours', while also providing the mechanisms and the ideology for imposing austerity on the continent".
Battered by criticism, the European Commission finally decided that "something more" was needed in addition to austerity policies for peripheral countries like Greece. "Something more" was announced to be structural reforms—things like making it easier for companies to sack workers—but such reforms have been there from the very beginning, leading Dani Rodrik to dismiss the EC's idea as "merely old wine in a new bottle." Indeed, Rodrik noted that with demand gutted by austerity, all structural reforms have achieved, and would continue to achieve, is pumping up unemployment (further reducing demand), since fired workers are not going to be re-employed elsewhere. Rodrik suggested the ECB might like to try out a higher inflation target, and that Germany might like to allow increased demand, higher inflation, and to accept its banks taking losses on their reckless lending to Greece. That, however, "assumes that Germans can embrace a different narrative about the nature of the crisis. And that means that German leaders must portray the crisis not as a morality play pitting lazy, profligate southerners against hard-working, frugal northerners, but as a crisis of interdependence in an economic (and nascent political) union. Germans must play as big a role in resolving the crisis as they did in instigating it." Paul Krugman described talk of structural reform as "an excuse for not facing up to the reality of macroeconomic disaster, and a way to avoid discussing the responsibility of Germany and the ECB, in particular, to help end this disaster." Furthermore, as Financial Times analyst Wolfgang Munchau observed, "Austerity and reform are the opposite of each other. If you are serious about structural reform, it will cost you upfront money." Claims that Germany had, by mid-2012, given Greece the equivalent of 29 times the aid given to West Germany under the Marshall Plan after World War II completely ignores the fact that aid was just a small part of Marshall Plan assistance to Germany, with another crucial part of the assistance being the writing off of a majority of Germany's debt.
Artificially low exchange rate
Though Germany claims its public finances are "the envy of the world", the country is merely continuing what has been called its "free-riding" of the euro crisis, which "consists in using the euro as a mechanism for maintaining a weak exchange rate while shifting the costs of doing so to its neighbors." With eurozone adjustment locked out by Germany, economic hardship elsewhere in the currency block actually suited its export-oriented economy for an extended period, because it caused the euro to depreciate, making German exports cheaper and so more competitive. The weakness of the euro, caused by the economy misery of peripheral countries, has been providing Germany with a large and artificial export advantage to the extent that, if Germany left the euro, the concomitant surge in the value of the reintroduced Deutsche Mark, which would produce "disastrous" effects on German exports as they suddenly became dramatically more expensive, would play the lead role in imposing a cost on Germany of perhaps 20–25% GDP during the first year alone after its euro exit. November 2013 saw the European Commission open an in-depth inquiry into German's surplus, which hit a new record in spring 2015. As the German current accounts surplus looked set to smash all previous records again in Spring 2015, one commentator noted that Germany was "now the biggest single violator of the eurozone stability rules. It would face punitive sanctions if EU treaty law was enforced." 2015 is "the fifth consecutive year that Germany's surplus has been above 6pc of GDP," it was pointed out. "The EU's Macroeconomic Imbalance Procedure states that the Commission should launch infringement proceedings if this occurs for three years in a row, unless there is a clear reason not to."
Advocacy of internal devaluation for peripheral economies
The version of adjustment offered by Germany and its allies is that austerity will lead to an internal devaluation, i.e. deflation, which would enable Greece gradually to regain competitiveness. "Yet this proposed solution is a complete non-starter", in the opinion of one UK economist. "If austerity succeeds in delivering deflation, then the growth of nominal GDP will be depressed; most likely it will turn negative. In that case, the burden of debt will increase." A February 2013 research note by the Economics Research team at Goldman Sachs again noted that the years of recession being endured by Greece "exacerbate the fiscal difficulties as the denominator of the debt-to-GDP ratio diminishes", i.e. reducing the debt burden by imposing austerity is, aside from anything else, utterly futile. "Higher growth has always been the best way out the debt (absolute and relative) burden. However, growth prospects for the near and medium-term future are quite weak. During the Great Depression, Heinrich Brüning, the German Chancellor (1930–32), thought that a strong currency and a balanced budget were the ways out of crisis. Cruel austerity measures such as cuts in wages, pensions and social benefits followed. Over the years crises deepened". The austerity program applied to Greece has been "self-defeating", with the country's debt now expected to balloon to 192% of GDP by 2014. After years of the situation being pointed out, in June 2013, with the Greek debt burden galloping towards the "staggering" heights previously predicted by anyone who knew what they were talking about, and with her own organization admitting its program for Greece had failed seriously on multiple primary objectives and that it had bent its rules when "rescuing" Greece; and having claimed in the past that Greece's debt was sustainable—Christine Lagarde felt able to admit publicly that perhaps Greece just might, after all, need to have its debt written off in a meaningful way. In its Global Economic Outlook and Strategy of September 2013, Citi pointed out that Greece "lack[s] the ability to stabilise […] debt/GDP ratios in coming years by fiscal policy alone",:7 and that "large debt relief" is probably "the only viable option" if Greek fiscal sustainability is to re-materialise;:18 predicted no return to growth until 2016;:8 and predicted that the debt burden would soar to over 200% of GDP by 2015 and carry on rising through at least 2017.:9 Unfortunately, German Chancellor Merkel and Foreign Minister Guido Westerwelle had just a few months prior already spoken out again against any debt relief for Greece, claiming that "structural reforms" (i.e. "old wine in a new bottle", see Rodrik et al. above) were the way to go and—astonishingly—that "debt sustainability will continue to be assured".
Strictly in terms of reducing wages relative to Germany, Greece had been making 'progress': private-sector wages fell 5.4% in the third quarter of 2011 from a year earlier and 12% since their peak in the first quarter of 2010. The second economic adjustment programme for Greece called for a further labour cost reduction in the private sector of 15% during 2012–2014.
German views on inflation as a solution
The question then is whether Germany would accept the price of inflation for the benefit of keeping the eurozone together. On the upside, inflation, at least to start with, would make Germans happy as their wages rose in keeping with inflation. Regardless of these positives, as soon as the monetary policy of the ECB—which has been catering to German desires for low inflation so doggedly that Martin Wolf describes it as "a reincarnated Bundesbank"—began to look like it might stoke inflation in Germany, Merkel moved to counteract, cementing the impossibility of a recovery for struggling countries.
All of this has resulted in increased anti-German sentiment within peripheral countries like Greece and Spain. German historian Arnulf Baring, who opposed the euro, wrote in his 1997 book Scheitert Deutschland? (Does Germany fail?): "They (populistic media and politicians) will say that we finance lazy slackers, sitting in coffee shops on southern beaches", and "[t]he fiscal union will end in a giant blackmail manoeuvre […] When we Germans will demand fiscal discipline, other countries will blame this fiscal discipline and therefore us for their financial difficulties. Besides, although they initially agreed on the terms, they will consider us as some kind of economic police. Consequently, we risk again becoming the most hated people in Europe." Anti-German animus is perhaps inflamed by the fact that, as one German historian noted, "during much of the 20th century, the situation was radically different: after the first world war and again after the second world war, Germany was the world's largest debtor, and in both cases owed its economic recovery to large-scale debt relief." When Horst Reichenbach arrived in Athens towards the end of 2011 to head a new European Union task force, the Greek media instantly dubbed him "Third Reichenbach"; in Spain in May 2012, businessmen made unflattering comparisons with Berlin's domination of Europe in WWII, and top officials "mutter about how today's European Union consists of a 'German Union plus the rest'". Almost four million German tourists—more than any other EU country—visit Greece annually, but they comprised most of the 50,000 cancelled bookings in the ten days after the 6 May 2012 Greek elections, a figure The Observer called "extraordinary". The Association of Greek Tourism Enterprises estimates that German visits for 2012 will decrease by about 25%. Such is the ill-feeling, historic claims on Germany from WWII have been reopened, including "a huge, never-repaid loan the nation was forced to make under Nazi occupation from 1941 to 1945."
Analysis of the Greek rescue
The neutrality of this section is disputed. Relevant discussion may be found on the talk page. Please do not remove this message until the dispute is resolved. (June 2015)
One estimate is that Greece actually subscribed to €156bn worth of new debt in order to get €206bn worth of old debt to be written off, meaning the write-down of €110bn by the banks and others is more than double the true figure of €50bn that was truly written off. Taxpayers are now liable for more than 80% of Greece's debt. One journalist for Der Spiegel noted that the second bailout was not "geared to the requirements of the people of Greece but to the needs of the international financial markets, meaning the banks. How else can one explain the fact that around a quarter of the package won't even arrive in Athens but will flow directly to the country's international creditors?" He accused the banks of "cleverly manipulating the fear that a Greek bankruptcy would trigger a fatal chain reaction" in order to get paid. According to Robert Reich, in the background of the Greek bailouts and debt restructuring lurks Wall Street. While US banks are owed only about €5bn by Greece, they have more significant exposure to the situation via German and French banks, who were significantly exposed to Greek debt. Massively reducing the liabilities of German and French banks with regards to Greece thus also serves to protect US banks.
Creditors of Greece 2011 and 2015
According to Der Spiegel "more than 80 percent of the rescue package is going to creditors—that is to say, to banks outside of Greece and to the ECB. The billions of taxpayer euros are not saving Greece. They're saving the banks." One study found that the public debt of Greece to foreign governments, including debt to the EU/IMF loan facility and debt through the eurosystem, increased by €130 bn, from €47.8 bn to €180.5 billion, between January 2010 and September 2011. The combined exposure of foreign banks to Greek entities—public and private—was around 80bn euros by mid-February 2012. In 2009 they were in for well over 200bn. The Economist noted that, during 2012 alone, "private-sector bondholders reduced their nominal claims by more than 50%. But the deal did not include the hefty holdings of Greek bonds at the European Central Bank (ECB), and it was sweetened with funds borrowed from official rescuers. For two years those rescuers had pretended Greece was solvent, and provided official loans to pay off bondholders in full. So more than 70% of the debts are now owed to 'official' creditors", i.e. European taxpayers and the IMF. With regard to Germany in particular, a Bloomberg editorial noted that, before its banks reduced its exposure to Greece, "they stood to lose a ton of money if Greece left the euro. Now any losses will be shared with the taxpayers of the entire euro area."
Jan 16, 2018 | www.moonofalabama.org
Christian Chuba | Jan 16, 2018 8:48:12 AM | 101
Okay, the segment with the shooting through the truck window is still only 5 seconds but I'd argue that the fact that it is part of a 3 minute montage 'our guys are kicking ass in Afghanistan' actually gives it a much worse context. If this was some innocent procedural, 'we had to reluctantly do it' incident, no one in their right mind would have popped it into such a sequence.
Jan 05, 2018 | www.nakedcapitalism.com
by lan Cibils and Mariano Arana, Political Economy Department, Universidad Nacional de General Sarmiento, Buenos Aires, Argentina. Originally published at Triple Crisis
In Argentina's 2015 presidential run-off election, the neoliberal right-wing coalition "Cambiemos" (literally, "lets change"), headed by Mauricio Macri, defeated the populist Kirchnerista candidate by just two percentage points. Macri's triumph heralded a return to the neoliberal policies of the 1990s and ended twelve years of heterodox economic policies that prioritized income redistribution and the internal market. The ruling coalition also performed well in the October 2017 mid-term elections and has since begun implementing a draconian set of fiscal, labor, and social security reforms.
One of the hallmarks of the Cambiemos government so far has been a fast and furious return to international credit markets and a very substantial increase in new public debt. Indeed, since Macri came to power in 2015, Argentina has issued debt worth more than $100 billion. This marks a clear contrast to the Kirchner administrations, during which the emphasis was debt reduction.
The Kirchner Years: Debt Reduction?
Both Néstor and Cristina Kirchner pointed to desendeudamiento -- debt reduction -- as one of the great successes of their administrations. To what extent was debt reduced during the twelve years of Kirchnerismo?
Figure 1 shows the evolution of Argentina's public debt stock and the debt/GDP ratio between 2004-2017. One can see that there was a substantial reduction in the debt to GDP ratio between 2004-2011 -- the first two Kirchner terms -- due primarily to: a) the 2005 and 2010 debt restructuring offers, b) a deliberate policy of desendedudamiento (debt cancellation), and c) high growth rates. Indeed, debt/GDP dropped from 118.1% in 2004 to 38.9% in 2011. One can also see that the actual stock of public debt fell after the 2005 debt restructuring process, and then remained relatively stable until 2010. In 2011, it began a slow upward trend, due to the re-appearance of the foreign exchange constraint once the commodity bubble burst and capital flight increased.
Figure 1: Public Debt Stock (millions of dollars) and Debt/GDP ratio
Source: Ministry of Finance, Argentina.
An additional, fundamental change occurred during the first two Kirchner administrations: the change in currency composition of Argentina's public debt. Indeed, as Figure 2 shows, peso-denominated public debt reached 41% of total debt after the 2005 debt-restructuring process. Between 2005 and 2012 it remained relatively stable, and then, after 2012, dollar-denominated public debt began to grow again although never reaching pre-2005 debt-restructuring levels. The currency composition change is key, since it reduces considerably the pressure on the external accounts.
Figure 2: Currency Composition of Argentina's Public Debt (as a % GDP)
Source: Ministry of Finance, Argentina.
Fast and Furious
Since Macri became president in December 2015, there has been a dramatic change in official public debt strategy, radically reversing the process of debt reduction of the previous decade. As shown in Figure 1, there was a substantial jump in the stock of public debt in 2016, and it has continued to grow in 2017.The result to date has been a substantial increase in the stock of Argentina's dollar-denominated public debt, as well as an increase of the debt service to GDP ratio. New debt has been used to cover the trade deficit, pay off the vulture funds, finance capital flight, and meet debt service payments. All of this has resulted in growing concerns about Argentina's future economic sustainability, not to mention any possibility of promoting economic development objectives.
Upon taking office, the Macri Administration rapidly implemented a series of policies to liberalize financial flows and imports, and a 40% devaluation of the Argentine peso.  In this context, it also went on a debt rampage, increasing dollar denominated debt considerably. Between December 2015 and September 2017, Argentina's new debt amounts to the equivalent of $103.59 billion.  This includes new debt issued by the Treasury (80%), provincial governments (11%), and the private sector (9%). While Argentina's debt had been increasing slowly since 2011, the jump experienced in 2016 was unlike any other in Argentina's history.
If the increase in debt is alarming, the destination of those funds is also cause of concern. Data from Argentina's Central Bank (Banco Central de la República Argentina or BCRA) show that during the first eight months of 2017, net foreign asset accumulation of the private non-banking sector totaled $13.32 million, 33% more than all of 2016, which itself was 17% more than all of 2015. This means that since December 2015, Argentina has dollarized assets by approximately $25.29 billion.
According to the BCRA, during the same period there was a net outflow of capital due to debt interest payments, profits and dividends of $8.231 billion. Additionally, the net outflow due to tourism and travel is calculated at roughly $13.43 billion between December 2015 and August 2017.
In sum, the dramatic increase in dollar-denominated debt during the two first Macri years served to finance capital flight, tourism, profit remittances, and debt service, all to the tune of roughly $50 billion.
Where is This Headed?
Argentina's experience since the 1976 military coup until the crash of 2001 has shown how damaging is the combination of unfavorable external conditions and the destruction of the local productive structure. The post-crisis policies of the successive Kirchner administrations reversed the debt-dependent and deindustrializing policies of the preceding decades. However, since Macri took office in December 2015, Argentina has once again turned to debt-dependent framework of the 1990s. Not only has public debt grown in absolute terms, but the weight of dollar-denominated debt in total debt has also increased. Despite significant doubts regarding the sustainability of the current situation, the government has expressed intentions of continuing to issue new debt until 2020.
What are the main factors that call debt-sustainability into question? First, capital flight, which, as we have said above, is increasing, is compensated with new dollar-denominated public debt. Second, Argentina's trade balance turned negative in 2015 and has remained so since, with a total accumulated trade deficit between 2015 and the second quarter of 2017 of $6.53 billion. Import dynamics proved impervious to the 2016 recession, therefore it is expected that the deficit will either persist as is or increase if there are no drastic changes. Furthermore, in the 2018 national budget bill sent to Congress, Treasury Secretary Nicolás Dujovne projects that the growth rate of imports will exceed that of exports until at least 2021, increasing the current trade deficit by 68%.
Finally, according to the IMF's World Economic Outlook (October 2017), growth rate projections for industrialized countries increase prospects of a US Federal Reserve interest rate increase. This would make Argentina's new debt issues more expensive, increasing the burden of future debt service and increasing capital flight from Argentina (in what is generally referred to as the "flight to safety").
The factors outlined above generate credible and troublesome doubts about the sustainability of the economic policies implemented by the Macri administration. While there are no signs of a major crisis in the short term (that is, before the 2019 presidential elections), there are good reasons to doubt that the current level of debt accumulation can be sustained to the end of a potential second Macri term (2023). In other words, there are good reasons to believe that Argentines will once again have to exercise their well-developed ability to navigate through yet another profound debt crisis. This is not solely the authors' opinion. In early November 2017 Standard & Poor's placed Argentina in a list of the five most fragile economies.  It looks like, once again, storm clouds are on the horizon.
-  For details, see " Macri's First Year in Office: Welcome to 21 st Century Neoliberalism ."
-  Observatorio de la Deuda Externa, Universidad Metropolitana para la Educación y el Trabajo (UMET).
-  https://www.cnbc.com/2017/11/06/these-are-now-the-5-most-fragile-countries-exposed-to-higher-interest-rates-according-to-sp.html
Jim Haygood , January 5, 2018 at 11:02 amJon S , January 5, 2018 at 11:21 am
'What are the main factors that call debt sustainability into question? First, capital flight.'
Capital flees Argentina whenever the opportunity arises because successive governments -- whether leftist or conservative -- refuse to control inflation and maintain a stable currency.
Since 2001, the Argentine peso has slid from one-to-one with the US dollar to about 19 to the dollar today. With Argentine inflation running in the low to mid twenties (according to INDEC and Price Stats), the peso can be expected to carry on weakening against the dollar indefinitely.
A hundred years during which the peso has lopped off thirteen (13) zeros owing to chronic inflation shows that Argentina is politically and culturally incapable of responsibly managing its own currency.
Argentines know this. Unfortunately, only the richer ones have assets they can move to safety outside the country. The hand-to-mouth poor will continue being ravaged by inflation, not to mention the large quantities of counterfeit pesos in circulation.
Letting Argentines play with fiat currency is like handing out loaded pistols to rowdy 5-year-olds. In both these sad cases, adult supervision is urgently needed.Tim Smyth , January 5, 2018 at 11:53 am
The grand history of Latin America: borrow billions of $$$ from U.S. banks, hand the money to the wealthy who immediately deposit it right back in American banks, and let the poor pay back the principal and interest. Hmmm . seems more and more the way this country is going.Anonimo2 , January 5, 2018 at 1:05 pm
The fixed exchange rate under Kirchner was totally unsustainable. One difference between Macri's neoliberalism and his predecessors is Macri is allowing much more of a floating currency than in the pre 2001 time period (We can debate how much it is actually is floating and clearly a lot of this debt issuance is for currency stabilization that I personally don't approve of).Joel , January 5, 2018 at 2:12 pm
And who are the adults? Let me guess, bankers and bondholders?Wukchumni , January 5, 2018 at 11:14 am
I'm not an expert in this at all, but in Peru, you could hold bank accounts in either national currency or dollars. The national currency accounts spared you currency exchange fees and also had higher interest rates. Most people who could hedged their bets by putting money in both accounts.
It seems like a happy medium between abandoning national currencies and letting savers get ravaged? No?MisterMr , January 5, 2018 at 11:31 am
While not as spectacular of a return as Bitcoin, but impressive nonetheless, the escape route for an Argentinean @ the turn of the century was the golden rule, an ounce of all that glitters was 300 pesos then and now around 25,000 pesos, a most excellent 'troy' horse.a different chris , January 5, 2018 at 12:41 pm
So, is austerity good or is austerity bad? And in what conditions?
I'm for expansionary government expense (and direct government ownership of some industries, such as with an NHS) balanced by taxes on high incomes.
So in my view the problem happens when the government lowers taxes on the rich, as seems likely in this case.
On the other hand taxes on the rich are likely to cause capital flight.nonsense factory , January 5, 2018 at 5:07 pm
So why did Macri get elected to do this? Yeah he didn't win by much, but he won.
>The hand-to-mouth poor will continue being ravaged by inflation
Which is freaking weird. Argentina has cropland. They have energy sources (and I won't bore everybody ok, I will with the observation that the Industrial Age is generously a 300/8000 year ratio part of human history).
And doesn't the below need some unpacking?:
>only the richer ones have assets they can move to safety outside the country
What are these assets? Why are said assets mobile? How did they come to "own" them? What percentage of the population is encompassed by "the richer ones" phrasing?JohnnyGL , January 5, 2018 at 6:21 pm
Question: why doesn't MMT thinking work for countries like Argentina?
As wikipedia notes:
"The key insight of MMT is that "monetarily sovereign government is the monopoly supplier of its currency and can issue currency of any denomination in physical or non-physical forms. As such the government has an unlimited capacity to pay for the things it wishes to purchase and to fulfill promised future payments, and has an unlimited ability to provide funds to the other sectors. Thus, insolvency and bankruptcy of this government is not possible. It can always pay."
Is this a general flaw in MMT? Does MMT only apply to dominant nation-states like the U.S., who can use foreign military and financial pressures to protect the currency, aka the petrodollar? Is the petrodollar a true 'fiat currency' or is it somehow based on control of commodities (especially oil)? Is there something peculiar about Argentina and other countries facing currency devaluation that MMT doesn't handle well? Any ideas on this?
That wikipedia write up isn't wrong, but it could be better. Probably need to hammer home the point that the sovereign can always pay IN THE CURRENCY THAT IT ISSUES.
Most of the MMT related conversations on this site, and the posts that are written up on the subject are mostly about explaining how there are constraints that many people THINK exist in the USA, but don't actually exist, at least in economic terms (political constraints notwithstanding). A country cannot be forced to default on a currency it issues. If the USA had significant debts in EUR or JPY, then it'd be a very different conversation.
External constraints are a big deal for most countries, especially developing countries that depend on exports of primary commodities. Chile, for instance, is constrained by balance of payments problems when the price of copper declines. Also, developed countries that are relatively smaller have much more limited sovereignty. The Swiss Central Bank has to follow what the ECB does, to a large degree.
On the other hand, there's episodes where some countries have found room for maneuver when they give up their sovereign currency. I didn't expect that Ecuador's economy would perform quite as well as it has in recent years. But, they've shown that you can find ways to get creative to compensate for loss of monetary sovereignty. Of course, the fiscal constraints are real since Ecuador can't print USD.
Brazil's recent neoliberal turn was frustrating for a variety of reasons, but being a big, diverse economy, they've got more sovereignty than their neighbors. However, the business and political elites in Brazil decided to hammer through austerity (spending cuts and interest rate hikes) because they WANTED to, not because external forces made them do it.
No doubt an MMT prescription for Argentina would advice them to lay off the $ denominated debt and stick to pesos as much as possible. I'd imagine Stephanie Kelton or any of the UMKC crew would advise curtailing imports or doing some import substitution in order to take pressure off balance of payments issues. They'd also take a look at what was driving inflation domestically and try to find ways to relieve it with a targeted approach, instead of risking recession and unemployment. Neoliberal/Washington Consensus type economists would say hike interest rates, cut government spending in order to curtail demand. They'd argue that the private sector will make the best decisions about where to reign in spending to reduce inflation.
Dec 22, 2017 | www.unz.com
What makes a Harvey Weinstein moment? The now-disgraced Hollywood mogul is hardly the first powerful man to stand accused of having abused women. The Harveys who preceded Harvey himself are legion, their prominence matching or exceeding his own and the misdeeds with which they were charged at least as reprehensible.
In the relatively recent past, a roster of prominent offenders would include Bill Clinton, Bill Cosby, Roger Ailes, Bill O'Reilly, and, of course, Donald Trump. Throw in various jocks, maestros, senior military officers, members of the professoriate and you end up with quite a list. Yet in virtually all such cases, the alleged transgressions were treated as instances of individual misconduct, egregious perhaps but possessing at best transitory political resonance.
All that, though, was pre-Harvey. As far as male sexual hijinks are concerned, we might compare Weinstein's epic fall from grace to the stock market crash of 1929: one week it's the anything-goes Roaring Twenties, the next we're smack dab in a Great Depression.
How profound is the change? Up here in Massachusetts where I live, we've spent the past year marking John F. Kennedy's 100th birthday. If Kennedy were still around to join in the festivities, it would be as a Class A sex offender. Rarely in American history has the cultural landscape shifted so quickly or so radically.
In our post-Harvey world, men charged with sexual misconduct are guilty until proven innocent, all crimes are capital offenses, and there exists no statute of limitations. Once a largely empty corporate slogan, "zero tolerance" has become a battle cry.
All of this serves as a reminder that, on some matters at least, the American people retain an admirable capacity for outrage. We can distinguish between the tolerable and the intolerable. And we can demand accountability of powerful individuals and institutions.
Everything They Need to Win (Again!)
What's puzzling is why that capacity for outrage and demand for accountability doesn't extend to our now well-established penchant for waging war across much of the planet.
In no way would I wish to minimize the pain, suffering, and humiliation of the women preyed upon by the various reprobates now getting their belated comeuppance. But to judge from published accounts, the women (and in some cases, men) abused by Weinstein, Louis C.K., Mark Halperin, Leon Wieseltier, Kevin Spacey, Al Franken, Charlie Rose, Matt Lauer, Garrison Keillor, my West Point classmate Judge Roy Moore, and their compadres at least managed to survive their encounters. None of the perpetrators are charged with having committed murder. No one died.
Compare their culpability to that of the high-ranking officials who have presided over or promoted this country's various military misadventures of the present century. Those wars have, of course, resulted in hundreds of thousands of deaths and will ultimately cost American taxpayers many trillions of dollars. Nor have those costly military efforts eliminated "terrorism," as President George W. Bush promised back when today's G.I.s were still in diapers.
Bush told us that, through war, the United States would spread freedom and democracy. Instead, our wars have sown disorder and instability, creating failing or failed states across the Greater Middle East and Africa. In their wake have sprung up ever more, not fewer, jihadist groups, while acts of terror are soaring globally. These are indisputable facts.
It discomfits me to reiterate this mournful litany of truths. I feel a bit like the doctor telling the lifelong smoker with stage-four lung cancer that an addiction to cigarettes is adversely affecting his health. His mute response: I know and I don't care. Nothing the doc says is going to budge the smoker from his habit. You go through the motions, but wonder why.
In a similar fashion, war has become a habit to which the United States is addicted. Except for the terminally distracted, most of us know that. We also know -- we cannot not know -- that, in places like Afghanistan and Iraq, U.S. forces have been unable to accomplish their assigned mission, despite more than 16 years of fighting in the former and more than a decade in the latter.
It's not exactly a good news story, to put it mildly. So forgive me for saying it ( yet again ), but most of us simply don't care, which means that we continue to allow a free hand to those who preside over those wars, while treating with respect the views of pundits and media personalities who persist in promoting them. What's past doesn't count; we prefer to sustain the pretense that tomorrow is pregnant with possibilities. Victory lies just around the corner.
By way of example, consider a recent article in U.S. News and World Report. The headline: "Victory or Failure in Afghanistan: 2018 Will Be the Deciding Year." The title suggests a balance absent from the text that follows, which reads like a Pentagon press release. Here in its entirety is the nut graf (my own emphasis added):
"Armed with a new strategy and renewed support from old allies, the Trump administration now believes it has everything it needs to win the war in Afghanistan. Top military advisers all the way up to Defense Secretary Jim Mattis say they can accomplish what two previous administrations and multiple troop surges could not: the defeat of the Taliban by Western-backed local forces, a negotiated peace and the establishment of a popularly supported government in Kabul capable of keeping the country from once again becoming a haven to any terrorist group."
Now if you buy this, you'll believe that Harvey Weinstein has learned his lesson and can be trusted to interview young actresses while wearing his bathrobe.
For starters, there is no "new strategy." Trump's generals, apparently with a nod from their putative boss, are merely modifying the old "strategy," which was itself an outgrowth of previous strategies tried, found wanting, and eventually discarded before being rebranded and eventually recycled.
Short of using nuclear weapons, U.S. forces fighting in Afghanistan over the past decade and a half have experimented with just about every approach imaginable: invasion, regime change, occupation, nation-building, pacification, decapitation, counterterrorism, and counterinsurgency, not to mention various surges , differing in scope and duration. We have had a big troop presence and a smaller one, more bombing and less, restrictive rules of engagement and permissive ones. In the military equivalent of throwing in the kitchen sink, a U.S. Special Operations Command four-engine prop plane recently deposited the largest non-nuclear weapon in the American arsenal on a cave complex in eastern Afghanistan. Although that MOAB made a big boom, no offer of enemy surrender materialized.
$65 billion in U.S. taxpayer dollars. And under the circumstances, consider that a mere down payment.
According to General John Nicholson, our 17th commander in Kabul since 2001, the efforts devised and implemented by his many predecessors have resulted in a "stalemate" -- a generous interpretation given that the Taliban presently controls more territory than it has held since the U.S. invasion. Officers no less capable than Nicholson himself, David Petraeus and Stanley McChrystal among them, didn't get it done. Nicholson's argument: trust me.
In essence, the "new strategy" devised by Trump's generals, Secretary of Defense Mattis and Nicholson among them, amounts to this: persist a tad longer with a tad more. A modest uptick in the number of U.S. and allied troops on the ground will provide more trainers, advisers, and motivators to work with and accompany their Afghan counterparts in the field. The Mattis/Nicholson plan also envisions an increasing number of air strikes, signaled by the recent use of B-52s to attack illicit Taliban " drug labs ," a scenario that Stanley Kubrick himself would have been hard-pressed to imagine.
Notwithstanding the novelty of using strategic bombers to destroy mud huts, there's not a lot new here. Dating back to 2001, coalition forces have already dropped tens of thousands of bombs in Afghanistan. Almost as soon as the Taliban were ousted from Kabul, coalition efforts to create effective Afghan security forces commenced. So, too, did attempts to reduce the production of the opium that has funded the Taliban insurgency, alas with essentially no effect whatsoever . What Trump's generals want a gullible public (and astonishingly gullible and inattentive members of Congress) to believe is that this time they've somehow devised a formula for getting it right.
Turning the Corner
With his trademark capacity to intuit success, President Trump already sees clear evidence of progress. "We're not fighting anymore to just walk around," he remarked in his Thanksgiving message to the troops. "We're fighting to win. And you people [have] turned it around over the last three to four months like nobody has seen." The president, we may note, has yet to visit Afghanistan.
I'm guessing that the commander-in-chief is oblivious to the fact that, in U.S. military circles, the term winning has acquired notable elasticity. Trump may think that it implies vanquishing the enemy -- white flags and surrender ceremonies on the U.S.S. Missouri . General Nicholson knows better. "Winning," the field commander says , "means delivering a negotiated settlement that reduces the level of violence and protecting the homeland." (Take that definition at face value and we can belatedly move Vietnam into the win column!)
Should we be surprised that Trump's generals, unconsciously imitating General William Westmoreland a half-century ago, claim once again to detect light at the end of the tunnel? Not at all. Mattis and Nicholson (along with White House Chief of Staff John Kelly and National Security Adviser H.R. McMaster) are following the Harvey Weinstein playbook: keep doing it until they make you stop. Indeed, with what can only be described as chutzpah, Nicholson himself recently announced that we have " turned the corner " in Afghanistan. In doing so, of course, he is counting on Americans not to recall the various war managers, military and civilian alike, who have made identical claims going back years now, among them Secretary of Defense Leon Panetta in 2012 .
From on high, assurances of progress; in the field, results that, year after year, come nowhere near what's promised; on the homefront, an astonishingly credulous public. The war in Afghanistan has long since settled into a melancholy and seemingly permanent rhythm.
The fact is that the individuals entrusted by President Trump to direct U.S. policy believe with iron certainty that difficult political problems will yield to armed might properly employed. That proposition is one to which generals like Mattis and Nicholson have devoted a considerable part of their lives, not just in Afghanistan but across much of the Islamic world. They are no more likely to question the validity of that proposition than the Pope is to entertain second thoughts about the divinity of Jesus Christ.
In Afghanistan, their entire worldview -- not to mention the status and clout of the officer corps they represent -- is at stake. No matter how long the war there lasts, no matter how many " generations " it takes, no matter how much blood is shed to no purpose, and no matter how much money is wasted, they will never admit to failure -- nor will any of the militarists-in-mufti cheering them on from the sidelines in Washington, Donald Trump not the least among them.
Meanwhile, the great majority of the American people, their attention directed elsewhere -- it's the season for holiday shopping, after all -- remain studiously indifferent to the charade being played out before their eyes.
It took a succession of high-profile scandals before Americans truly woke up to the plague of sexual harassment and assault. How long will it take before the public concludes that they have had enough of wars that don't work? Here's hoping it's before our president, in a moment of ill temper, unleashes " fire and fury " on the world.
Andrew J. Bacevich, a TomDispatch regular , is the author, most recently, of America's War for the Greater Middle East: A Military History .
anonymous , Disclaimer December 11, 2017 at 3:31 am GMTIt's astonishing to see people make the claim that "victory" is possible in Afghanistan. Could they actually believe this or are they lying in order to drag this out even longer and keep the money pit working overtime? These are individuals that are highly placed and so should know better. It's not really a war but an occupation with the native insurgents fighting to oust the foreign occupier. The US has tried every trick there is in trying to tamp down the insurgency. They know what we're trying to do and can thwart us at every step. The US lost even as it began it's invasion there but didn't know it yet in the wake of it's initial success in scattering the Taliban, not even a real army and not even a real state. They live there and we don't; they can resist for the next thirty years or fifty years. When does the multi-billion bill come due and how will we pay it?Issac , December 12, 2017 at 4:07 am GMT"How long will it take before the public concludes that they have had enough of wars that don't work?"USAMNESIA , December 14, 2017 at 3:32 am GMT
It already happened, but Progressives like you failed to note that Republican voters subbed the Bush clan and their various associates for Trump in the Primary season, precisely because he called the Iraq and Afghan wars mistakes. The Americans suffer under a two party establishment that is clearly antagonistic to their interests. As a part of that regime, a dutiful Progressive toad, you continue to peddle the lie that it was the war-weary White Americans who celebrated those wars. In reality, any such support was ginned up from tools like you who wrote puff pieces for their Neocon Progressive masters.
Thus far, Trump's interventionism has been a fragment of what the Hillary campaign promised. Might you count that among your lucky stars? Fat chance. You cretinous Progressive filth have no such spine upon which to base an independent thought. You trot out the same old tiresome tropes week after week fulfilling your designated propagandist duty and then you skulk back to your den of iniquity to prepare another salvo of agitprop. What a miserable existence.This is the center of a world empire. It maintains a gigantic military which virtually never stops fighting wars, none of them having anything to do with defense. It has created an intelligence monstrosity which makes old outfits like Stazi seem almost quaint, and it spies on everyone. Indeed, it maintains seventeen national security establishments, as though you can never have too much of a good thing. And some of these guys, too, are engaged full-time in forms of covert war, from fomenting trouble in other lands and interfering in elections to overthrowing governments.nsa , December 18, 2017 at 5:36 am GMT
Obama ended up killing more people than any dictator or demagogue of this generation on earth you care to name, several hundred thousand of them in his eight years. And he found new ways to kill, too, as by creating the world's first industrial-scale extrajudicial killing operation. Here he signs off on "kill lists," placed in his Oval Office in-box, to murder people he has never seen, people who enjoy no legal rights or protections. His signed orders are carried out by uniformed thugs working at computer screens in secure basements where they proceed to play computer games with real live humans as their targets, again killing or maiming people they have never seen.
If you ever have wondered where all the enabling workers came from in places like Stalin's Gulag or Hitler's concentration camps, well, here is your answer. American itself produces platoons of such people. You could find them working at Guantanamo and in the far-flung string of secret torture facilities the CIA ran for years, and you could find them in places like Fallujah or Samarra or Abu Ghraib, at the CIA's basement game arcade killing centers, and even all over the streets of America dressed as police who shoot unarmed people every day, sometimes in the back.
https://chuckmanwords.wordpress.com/2017/01/12/john-chuckman-essay-of-wizards-and-washington-and-the-dreary-unrelenting-reality-of-american-politics-a-raw-and-sometimes-darkly-comic-survey-of-americas-treacherous-political-terrain/ZOG has now asserted the right to kill anyone, anywhere, anytime, for any reason. No trial, no hearing, no witnesses, no defense, no nothing. Is this actually legal? Any constitutional lawyers out there care to comment? Has ZOG now achieved the status of an all-powerful all-knowing deity with the power of life and death over all living things?Waiting too , December 18, 2017 at 10:36 am GMTIt's unlikely that the USA would be remaining in Afghanistan if its goals were not being attained. So the author has merely shown that the stated goals cannot be the real goals. What then are the real goals? I propose two: 1) establish a permanent military presence on a Russian border; 2) finance it with the heroin trade. Given other actions of the Empire around the globe, the first goal is obvious. The bombing of mud huts containing competitors' drug labs, conjoined with the fact that we do not destroy the actual poppy fields (obvious green targets in an immense ocean of brown) make this goal rather obvious as well. The rest of the article is simply more evidence that the Empire does not include mere human tragedy in its profit calculation.War for Blair Mountain , December 18, 2017 at 1:09 pm GMT5.6 TRILLION $$$$$$ FOR GULF WAR 1 AND GULF WAR 2DESERT FOX , December 18, 2017 at 1:43 pm GMT
The Native Born White American Working Class Teenage Male Population used as CANNON FODDER for Congressman Steven Solarz's and Donald Trump's very precious Jewish only Israel .
WAR IS A RACKET!!!! don't you think?Israel and the deep state did the attack on 911 and thus set the table for the wars in Afghanistan and Iraq and Libya and Syria and the Zionist neocons who control every facet of the U.S. gov and the MSM and the MIC and the FED ie the BANKS set in motion the blood sacrifice for their Zionist god SATAN, that is what they have done.Michael Kenny , December 18, 2017 at 2:17 pm GMT
The Zionist warmongers and Satanists will destroy America.It's not so much that America is addicted to war as that the American "business model" makes permanent war inevitable. US global dominance rests on economic domination, in particular, the dollar as world reserve currency. That has allowed the US economy to survive in spite of being hollowed out, financialised and burdened with enormous sovereign debt. Economic dominance derives from political dominance, which, in its turn, flows from military dominance. For that military dominance to be credible, not only must the US have the biggest and best military forces on the planet, it must show itself willing to use those forces to maintain its dominance by actually using them from time to time, in particular, to unequivocally beat off any challenge to its dominance (Putin!). It also, of course, must win, or, more correctly, be able to present the outcome credibly as a win. Failure to maintain military dominance will undermine the position of the dollar, sending its value through the floor. A low dollar means cheap exports (Boeing will sell more planes than Airbus!), but it also means that imports (oil, outsourced goods) will be dear. At that point the hollowed out nature of the US economy will cut in, probably provoking a Soviet-style implosion of the US economy and society and ruining anyone who has holdings denominated in dollars. I call that the Gorbachev conundrum. Gorby believed in the Soviet Union and wanted to reform it. But the Soviet system had become so rigid as to be unreformable. He pulled a threat and the whole system unravelled. But if he hadn't pulled the thread, the whole system would have unravelled anyway. It was a choice between hard landing and harder landing. Similarly, US leaders have to continue down the only road open to them: permanent war. As Thomas Jefferson said of slavery, it's like holding a wolf by the ears. You don't like it but you don't dare let go!TG , December 18, 2017 at 2:36 pm GMT"How long will it take before the public concludes that they have had enough of wars that don't work?" Answer: Never.Intelligent Dasein , Website December 18, 2017 at 2:37 pm GMT
In Alabama when people would rant about how toxic Roy Moore was, I would politely point out that his opponent for Senate was OK with spending trillions of dollars fighting pointless winless wars on the other side of the planet just so politically connected defense contractors can make a buck, and ask if that should be an issue too? The response, predictably, was as if I was an alien from the planet Skyron in the galaxy of Andromeda.
We are sheep. We are outraged at these sexual transgressions because the corporate press tells us to be outraged. We are not outraged at these stupid foreign wars, because the corporate press does not tell us to be outraged. It's all mass effect, and the comfort of being in a herd and all expressing the same feelings.Andrew Bacevich is wrong about a couple of things in this article.Ilyana_Rozumova , December 18, 2017 at 3:04 pm GMT
First, he says that the American public is both apathetic and credulous. I agree that we have largely become apathetic towards these imperial wars, but I disagree that we have become credulous. In fact, these two states of mind exclude one another; you cannot be both apathetic and credulous with respect to the same object at the same time. The credulity charge is easy to dismiss because virtually no one today believes anything that comes out of Washington or its mouthpieces in the legacy media. The apathy charge is on point but it needs qualification. The smarter, more informed Americans have seen that their efforts to change the course of American policy have been to no avail, and they've given up in frustration and disgust. The less smart, less informed Americans are constrained by the necessity of getting on with their meager lives; they are an apolitical mass that possesses neither the understanding nor the capacity to make any difference on the policy front whatsoever.
Second, Andrew Bacevich calls for a Weinstein moment without realizing that it already happened more than ten years ago. The 2006 midterm elections were the first Weinstein moment, which saw the American people deliver a huge outpouring of antiwar sentiment that inflicted significant congressional losses on the neocon Republicans of George W. Bush. An echo of that groundswell happened again in 2008 when Barack Obama was elected to office on an explicitly antiwar platform. But Obama turned out to be one of the most pro-war presidents ever, and thus an angry electorate made one final push in the same direction by attempting to clean house with Donald Trump. Now that Donald has shown every sign of having cucked out to the war lobby, we seem to be left with no electoral solutions.
The only thing that's going to work is for the American Imperium to be handed a much-deserved military and financial defeat. The one encouraging fact is that if the top ten percent of our political and financial elite were planed off by a foreign power, the American people would give as few damns about that as they currently do about our imperial wars.@Michael KennyAnonymous , Disclaimer December 18, 2017 at 3:17 pm GMT
Very good but some little errors. Concerning Russia and China, Russia vent all or nothing. China was much smarter. First they allowed self employment, than small business and long time after they started to sell state enterprises,If Tom's Dispatch continues to be successful, Americans will continue to be asleep.nebulafox , December 18, 2017 at 4:00 pm GMT
Masterful propaganda. War, according to our favorite spooks, is necessary to win, but otherwise reprehensible.
Sex is otherwise necessary for human life but Harvey Weinstein is ugly. Hold tightly to your cognitive dissonance, because you're expected to remember John F Kennedy who got it on, but is the expendable martyr you should care about, not that other guy
Let's review: terror attacks are wins. Superior or effective anti-war propaganda comes from the military
itself. They really don't want war, but really they do.@anonymousnebulafox , December 18, 2017 at 4:08 pm GMT
We're trying to make Afghanistan not Afghanistan: aka, trying to be a miracle worker. We can throw as much money as we like at that place, and it isn't going to happen, least of all with troops on nine month shifts.
Let Iran and Pakistan squabble over it. Good riddance.@Waiting tooAnonymous , Disclaimer December 18, 2017 at 4:28 pm GMT
1) doesn't really make much sense, given that Poland and the Baltic States would be more than happy to take all US forces in Europe to give us a presence near Russia in a part of the world that would be far easier to justify to the American public-and to the international community. Afghanistan? Who exactly is Russia going to mess with? Iran is their-for now, longer term, the two have conflicting agendas in the region, but don't expect the geniuses in the Beltway to pick up on that opportunity-ally, and unlike the USSR, the Russians don't want to get involved in the India-Pakistan conflict. Russia's current tilt toward China makes a strategic marriage with India of the kind that you found in the Cold War impossible, but they obviously don't want to tilt toward the basketcase known as Pakistan. The only reason that Russia would want to get involved with Afghanistan beyond having a more preferable status than having American troops there is power projection among ex-Soviet states, and there are far more effective ways to do than muddle about with Afghanistan.
2, on the other hand, given Iran-Contra who knows? The first generation of the Taliban pretty much wiped the heroin trade out as offensive to Islamic sensibilities, but the newer generations have no such qualms.
I think you give America's rulers far too much credit. The truth is probably far scarier: the morons who work in the Beltway honestly believe their own propaganda-that we can make Afghanistan into some magical Western democracy if we throw enough money at it-and combine that with the usual bureaucratic inertia.@Waiting tooArt , December 18, 2017 at 4:45 pm GMT
Another bonus is that Afghan heroin seeps into Russia and wreaks havoc in the regions bordering Afghanistan -- krokodil and all that.According to General John Nicholson, our 17th commander in Kabul since 2001,MarkinLA , December 18, 2017 at 5:59 pm GMT
We have been killing these people for 17 years. Now our generals say that if we indiscriminately kill enough men, women, and children who get in the way of our B52s, that they will see the light and make peace. How totally wonderful.
My solution is to gage the Lindsey Grahams for a year.
What will do more good for peace – B52s or shutting up Graham's elk?
Think Peace -- ArtI remember when Trump said he knew more than the generals and was viciously attacked for it. It turns out he did know more than the generals just by knowing it was a waste. Trump was pushed by politics to defer to the generals who always have an answer when it comes to a war – more men, more weapons, more time.Sollipsist , December 18, 2017 at 6:20 pm GMT@Intelligent DaseinpeterAUS , December 18, 2017 at 6:46 pm GMT
"The less smart, less informed Americans are constrained by the necessity of getting on with their meager lives; they are an apolitical mass that possesses neither the understanding nor the capacity to make any difference on the policy front whatsoever."
I wonder if any Abolitionists criticized the slaves for failing to revolt? Probably not; I'm guessing they were mostly convinced that the negro required intervention from outside, whether due to their nature or from overwhelming circumstance.
If the enslaved American public is liberated, I hope we'll know what to do with ourselves afterwards. It'd be a shame to simply end up in another kind of bondage, resentful and subject to whatever oppressive system replaces the current outrage. Perhaps the next one will more persuasively convince us that we're important and essential?@Michael KennypeterAUS , December 18, 2017 at 6:47 pm GMT
Very good post, IMHO.
That phrase "a choice between hard landing and harder landing" is good and can be easily applied to USA today.
Interesting times.@TGSowhat , December 18, 2017 at 7:29 pm GMT
This is well written, IMHO:
We are sheep. We are outraged at these sexual transgressions because the corporate press tells us to be outraged. We are not outraged at these stupid foreign wars, because the corporate press does not tell us to be outraged. It's all mass effect, and the comfort of being in a herd and all expressing the same feelings.Thank you, Andrew J. Bacevich, for your words of wisdom and thank you, Mr. Unz, for this post.Delinquent Snail , December 18, 2017 at 8:57 pm GMT
This corporation needs to be dissolved. I've read about "the inertia" of Federal Government that has morphed into a cash cow for a century of wasted tax dollars funding the MIIC, now the MIIC. Does our existence have to end in financial ruin or, worse yet, some foreign entity creating havoc on our soil?
The Founders NEVER intended that the US of A become a meddler in other Sovereignty's internal affairs or the destroyer of Nation States that do not espoused our "doctrine." Anyone without poop for brains knows that this is about Imperialism and greed, fueled by money and an insatiable luster for MORE.
This should be easier to change than it appears. Is there no will? After all, it Is our Master's money that lubricates the machinery. So, we continue to provide the lubrication for our Masters like a bunch of imbeciles that allow them to survail our words and movements. Somebody please explain our stupidity.@nebulafoxjoe webb , December 18, 2017 at 8:58 pm GMT
If americans would just go all in and commit genocide. That would lead to victory.
No afgans, no enemy.the folks in the US are sick of the wars, contrary to Bacevich. They simply will vote come next election accordingly. They register their disgust in all the polls.Jim Christian , December 18, 2017 at 9:07 pm GMT
This article is not very useful. More punditry puff.
No comments on the Next War for Israel being cooked up by the new crop of neocon youngsters, I guess, and Trump who will trump, trump, trump into the next War for the Jews.
How about some political science on Iran, Syria, Hisbollah, Hamas and the US, Arabia, Judenstaat axis of evil?
Joe WebbHey Bacevich? When you link to WashPost and NYTimes to make your points, you don't. They block access if you've already read links to those two papers three times each and can no longer, for the month, read there. When folks link to papers that won't let you read, it makes one wonder why.Simply Simon , December 18, 2017 at 10:26 pm GMTI believe Americans are damned sick and tired of the stupid, needless war in Afghanistan. But then they should have been sick and tired of stupid , needless wars like Korea, Vietnam and Iraq, and probably most of them were. But it's easy to be complacent when someone else's son is doing the fighting and dying And it's easy to be complacent when your stomach is full and you have plenty of booze and pain killers available. There will be a day of reckoning when the next big economic bust arrives and which may make the Great Depression paltry by comparison. America is a far different place then it was in the 1930s when our population was 140 million. Americans were not so soft and the conveniences we now take for granted not available. When the supermarkets run out of food, watch out. There may not even be any soup lines to stand in.Joe Franklin , December 18, 2017 at 11:21 pm GMTDruid , December 19, 2017 at 12:41 am GMT
In truth, U.S. commanders have quietly shelved any expectations of achieving an actual victory -- traditionally defined as "imposing your will on the enemy" -- in favor of a more modest conception of success.
Your assumptions are wrong about the US goal of the invasion of Afghanistan. Afghanistan and Iraq were not invaded to establish democracy or impose American will whatever that is. Afghanistan and Iraq were invaded to establish a temporary military staging ground for a US invasion of Iran, the designated regional enemy of Israel. As long as the current regime in Iran remains, the US will remain in Iraq and Afghanistan.
... ... ...@Waiting tooanno nimus , December 19, 2017 at 1:53 am GMT
And minerals! Eric Prince himself recently tried to sell the idea of having his private militias do the fighting in Afghanistan for the US and finance it by mining said country's minerals, thus making himself even richer."i can live without a friend, but not without an enemy."Cloak And Dagger , December 19, 2017 at 5:03 am GMT@SolontoCroesusJoe Wong , December 20, 2017 at 2:25 pm GMT
I was onboard with Mr. Bacevich, until I got to this:
Almost as soon as the Taliban were ousted from Kabul, coalition efforts to create effective Afghan security forces commenced. So, too, did attempts to reduce the production of the opium that has funded the Taliban insurgency
What utter rubbish! The Taliban was instrumental in shutting down the poppy production until the CIA came along and restarted it to fund their black ops.
We have the reverse Midas touch. Everything we touch (Iraq, Libya, Syria, Yemen, etc., etc.) turns to shit. We supposedly attack countries to liberate them from their tyrants who are supposedly killing their own people, and end up killing more people than all of them put together. And, oh yes, we have our favorite tyrants (Saudis, Israelis) whom we provide with horrible weapons (like cluster bombs) to help them kill people we hate.
Mr. Bacevich is right about the lack of outrage about our wars, but the current Weinstein explosion consists of hordes of mostly American female victims, mostly white, a (very) few jews, and a few men, who have the stage to complain about their oppressors. What would be the counterpart of that w.r.t. the wars? Millions of brown victims in far away lands that most of us couldn't even find on a map? How likely is that to happen?
So yes, no outrage, and none likely. The last 17 years have proven that.@anonymous
You don't know the American has been paying everything through monopoly money printed through the thin air since WWI, i.e. a keystroke on the Federal Reserve's computer? No wonder the Americans have been waging reckless wars all over the world on the fabricated phantom WMD allegations as humanitarian intervention relentlessly.
Romans did not stop waging reckless wars until their empire collapsed; the British imitates the Romans and the American is born out of the British, hence the Americans will no stop waging reckless wars until their empire collapsed like the Romans.
Dec 25, 2017 | theduran.com
On Friday 21st December 2017 the Stockholm Arbitration Court made a ruling in the legal dispute between Ukraine's state owned gas monopoly Naftogaz and Russia's largely state owned gas monopoly Gazprom.
In the hours after the decision – which like all decisions of the Stockholm Arbitration Court – is not published, Naftogaz claimed victory in a short statement. However over the course of the hours which followed Gazprom provided details of the decision which suggests that the truth is the diametric opposite.The Duran recommends using WP Engine >>
Here is how the Financial Times reports the competing claims
Both Ukraine's Naftogaz and Russia's Gazprom both on Friday claimed victory as a Stockholm arbitration tribunal issued the final award ruling in the first of two cases in a three-year legal battle between the state-controlled energy companies, where total claims stand at some $80bn.
An emailed statement from the Ukrainian company was titled:
"Naftogaz wins the gas sales arbitration case against Gazprom on all issues in dispute."Start your own website here >>
The Stockholm arbitration tribunal -- in its final award ruling in a dispute over gas supplies from prior years -- had, according to Naftogaz, struck down Gazprom's claim to receive $56bn for gas contracted but not supplied through controversial "take-or-pay" clauses. They were included in a supply contract Ukraine signed in 2009 after Gazprom dented supplies to the EU by cutting all flow amid a price dispute -- including transit through the country's vast pipeline systems. In a tweet Ukraine's foreign minister
Pavlo Klimkin wrote: "The victory of Naftogaz in the Stockholm arbitration: It's not a knockout, but three knockdowns with obvious advantage."
But later Gazprom countered that arbitors "acknowledged the main points of the contract were in effect and upheld the majority of Gazprom's demands for payment for gas supplies", worth over $2bn. A Naftogaz official responded that the company never refused to pay for gas supplied, but challenged price and conditions.
Given the tribunal does not make its decisions public, doubt loomed over which side was the ultimate winner. Anticipation also grew over the second and final tribunal award expected early next year over disputes both have concerning past gas transit obligations.
Friday's final Stockholm arbitration ruling follows a preliminary decision from last May after which both sides were given time to settle monetary claims outside of the tribunal but failed to reach agreement.
Here is the full Naftogaz statement:
"Today, the Tribunal at the Arbitration Institute of the Stockholm Chamber of Commerce has completely rejected Gazprom take-or-pay claims to Naftogaz amounting to USD 56 billion for 2009-2017.
- – Naftogaz succeeded at reducing future contract volume obligations by more than 10 times and made them relevant to its actual import needs.
- – Price for gas off-taken by Naftogaz in 2Q 2014 reduced 27% from USD 485/tcm to USD 352/tcm. – Naftogaz saved USD 1.8 billion on gas purchased in 2014-2015 due to revision of the contract price.
- – Destination clause and other discriminatory provisions were declared invalid to bring the contract in line with current European market standards.
- – Naftogaz estimates the total positive financial effect of the arbitration over the lifetime of the supply contract at over USD 75 billion.
- – Naftogaz claims up to USD 16 billion in transit contract arbitration against Gazprom; decision expected on 28 February 2018."
Gazprom said that in a separate decision on May 31 of this year, the tribunal denied Naftogaz's application to review prices from May 2011 to April 2014, ordered it to pay $14bn for gas supplies during that period, and said that the take-or-pay conditions applied for the duration of the contract. Gazprom claimed that Naftogaz would have to pay it $2.18bn plus interest of 0.03 per cent for every day the payments were late, and then pay for 5bn cm of gas annually starting next year.
When the different sides give opposite accounts of the same decision it obviously becomes difficult to say what the real decision actually is. However Gazprom says that the court upheld (1) the main provisions of the contract; (2) the contract's take-or-pay provisions, these being a particularly contentious issue in the contract; and (3) that Naftogaz has been ordered to pay Gazprom $2 billion, presumably immediately, with interest for every day the amount is unpaid.
By contrast the reduction in the gas price Naftogaz refers to from $485/tcm to $352 tcm which Naftogaz makes much of in its statement appears to apply only to gas supplied to Ukraine by Gazprom in the second quarter of 2014 and still sets the price of gas supplied to Ukraine by Gazprom higher than was demanded by Ukraine during this period.
The key point here is that Russia agreed to reduce the price of gas supplied to Ukraine by an agreement Russia's President Putin reached with Ukraine's President Yanukovich in December 2013. After the Maidan coup the new Ukrainian government went back on the agreement causing the Russians to demand payment of the original price. However over the course of 2014, as energy prices began first to slide and then crashed, and as it became clear that Ukraine was simply not paying for its gas, Russia again reduced the price of the gas Ukraine had to pay.
What seems to have happened is that the Stockholm Arbitration Court decided to smooth out the price of gas payable by Ukraine throughout 2014, which is the sort of thing arbitration tribunals are regularly known to do, whilst leaving the essentials of the contract unchanged.
If so then this is not a victory by Ukraine but a clearcut defeat, which Naftogaz and the Ukrainian government have tried to spin into a victory by citing the reduction in the gas price in the second quarter of 2014 and the reduction in future gas import volumes, neither of which were contentious issues. By contrast it is clear that Ukraine and Naftogaz must pay the full contractual price and abide by the contract's take-or-pay provisions for the whole of the period of the contract prior to the second quarter of 2014.
What this means in terms of hard cash is that Ukraine must now pay Russia a further $2 billion on top of the $3 billion it was recently ordered to pay by the High Court in London. Just as it is holding back on paying the $3 billion it was ordered to pay by the High Court until the appeal process in London is finished, so it will try to hold off paying the $2 billion it has just been ordered to pay to Gazprom until the final decision of the Stockholm Arbitration Court (thus the brave talk of Naftogaz's claims of "up to $16 billion transit contract arbitration against Gazprom") but thereafter payment of the $2 billion will fall due. I say this because the claim Gazprom owes Naftogaz "up to" $16 billion in transit fees looks like it has been plucked out of the air.
What this means is that over the course of 2018 Ukraine will have to pay Russia $5 billion ($3 billion awarded by the High Court in London and $2 billion awarded by the Stockholm Arbitration Court). Since the $2 billion awarded by the Stockholm Arbitration Court is technically an arbitration award, Gazprom will need to convert it into a court Judgment before it can enforce it, but that is merely a formality. At that point this debt will become not merely due but legally enforceable as well.
Ukraine recently borrowed $3 billion on the international financial markets at very high interest almost certainly in order to pay the $3 billion the High Court in London has ordered it to pay Russia. Whilst the $2 billion is technically a debt owed by Naftogaz not Ukraine and its non-payment would does not place Ukraine in a state of sovereign default, Gazprom is in a position to enforce the debt against Naftogaz's assets (including gas it buys) in the European Economic Area. It is difficult to see how Naftogaz and Ukraine can avoid payment of this debt.
Has Ukraine actually gained anything from its long running gas dispute with Russia?
Naftogaz brags that Ukraine has saved up to $75 billion because it is no longer buying gas from Russia. However this begs the question of whether the gas Ukraine is now importing from Europe really is significantly cheaper than the gas Ukraine was buying from Russia? This is debatable and with energy prices rising it is likely to become even less likely over time.
Dec 23, 2017 | www.nakedcapitalism.com
December 23, 2017 Interview with Michael Hudson, a research professor of Economics at University of Missouri, Kansas City, and a research associate at the Levy Economics Institute of Bard College. His latest book is J is for Junk Economics . Cross-posted from Hudson's site .
As many people turn towards their Christian and Jewish faiths this Christmas and Hanukkah in an attempt to make sense of the year that was, at least one economist says we have been reading the bible in an anachronistic way.
In fact he has written an entire book on the topic. In And Forgive them their Debts: Credit and Redemption (available this spring on Amazon), Professor Michael Hudson makes the argument that far from being about sex, the bible is actually about economics, and debt in particular.
The Ten Commandments Were About Debt
People tend to think of the Commandment 'do not covet your neighbour's wife' in purely sexual terms but actually, the economist says it refers specifically to creditors who would force the wives and daughters of debtors into sex slavery as collateral for unpaid debt.
"This goes all the way back to Sumer in the third millennium," he said.
Similarly, the Commandment 'thou shalt not steal' refers to usury and exploitation by threat for debts owing.
But the rulers of classical antiquity who cancelled their subjects' debts tended to be overthrown with disturbing frequency – from the Greek 'tyrants' of the 7th century BC who overthrew the aristocracies of Sparta and Corinth, to Sparta's Kings Agis and Cleomenes in the 3rd century BC who sought to cancel Spartan debts, to Roman politicians advocating debt relief and land redistribution, Julius Caesar among them.
Jesus Died for Our Debt
Professor Hudson says Jesus Christ paid the ultimate price for his activism.
What Would Jesus Do?
To understand how to fix today's economy, Hudson says that the Bible's answers were practical for their time.And Forgive them their Debts: Credit and Redemption will be available for purchase just in time for Easter on Amazon.
Patrick Donnelly , December 23, 2017 at 6:32 amSteven , December 23, 2017 at 8:35 am
Reckless lending is a valid concept and has been put into law by Judges and almost unbelievably, lawmakers as well, in some jurisdictions.
The debt is void.
Tricking a borrower into overcommittment is worse and that is what happened in Ireland during the 80s onwards. The Prime ministers of different parties over that time had unlimited overdrafts with several banks, most notably the AIB. A conspiracy that meant only a very few were fully aware of the final result: bondholders would be reimbursed, with the scam being paid for by those who made money and also those who lost money in the asset Ponzi that was always the end.
Emigration was also the intended end, which worked quite well.AbateMagicThinking but Not money , December 23, 2017 at 9:21 am
With you right up to that last sentence. Why couldn't the simple banker theft, the 'free lunch', have been "the intended end"? Critics of the status quo IMHO often attribute way too much intelligence and foresight to the powers that be. There is such a thing as intelligent self-interest (greed). Germany's Bismark and Hudson's ancient rulers understood it. The West's ruling class apparently doesn't.flora , December 23, 2017 at 10:48 am
No more IMHOs please! It starts to read like Uriah Heap. No more humility. Just state your case.
Pip Pipflora , December 23, 2017 at 11:09 am
an aside: It's important to distinguish sentences of opinion from sentences of claimed fact, imo. ;) Opinion is just that, and can't be called out for malice or falsity. Incorrect statements of fact can be so called out. This is an important distinction in written comments. It's important for the reputation of the publication itself, and why LTEs insist on this distinction being made in the letters.
Uriah Heep's "umbleness" was a mask covering his scheming; a very different thing from making a simple written distinction between opinion and fact.St Jacques , December 23, 2017 at 3:33 pm
There's always 'IMNSHO', but that's more typing. :)Blue Pilgrim , December 23, 2017 at 9:57 am
I only ever make true statements, OK !!!
Trouble is that the next day I have a headache and everything looks yellow.Robert McGregor , December 23, 2017 at 11:56 am
'Lead us not into temptation' -- odious debt and liar loans, sounds like.Kurtismayfield , December 23, 2017 at 12:32 pm
> "Reckless lending is a valid concept and has been put into law by Judges and almost unbelievably, lawmakers as well, in some jurisdictions.
The debt is void.
Tricking a borrower into overcommittment . . ."
Take your average 21 year-old today or 40 years ago! Put him in the US and . . .
1) Expose him through the MSM to relentless advertising and propaganda that he should spend, spend, spend!
2) Don't teach him in school about personal finance and debt.
3) Give him a credit card.
What do you expect will happen? Through trickery the bankers have rigged a very profitable system for themselves. It is not a good system where a young person has to have way-above-knowledge-and-discipline in order to protect themselves from credit racketeers. That's why there is the ancient wisdom of the "Debt Jubilee"nilavar , December 23, 2017 at 1:59 pm
I blame credit card debt on the banks themselves.. they should know when to cut someone off, they are tracking your every move these days.OpenThePodBayDoorsHAL , December 23, 2017 at 3:55 pm
if only, all the LENDERS and the Banks (Banksters!) had followed the the cardinal rules(of Finance) of FIDUCIARY DUTY & DUE DILIGENCE, we wouldn't have 2008 crisis.
Banksters were bailed out and the 'DEBT' became the new money, world wise!
Now we have 2008 x10 (Mother of all Bubbles!) crisis at our door step!
Happy Holidays!Alopex , December 23, 2017 at 2:20 pm
The article doesn't distinguish "whose debts?"
When Citi takes too much debt they get Jubilee, when John Q. Public does, they get bankruptcy.
So let's not say "we should bring back Jubliee", we already have it, to the tune of tens of trillions of dollars. Jubliee for billionaires and bankers, just not for you and me.
It's similar to the debate over "Socialism", Bernie gets trashed for even daring to mention the word. But if "socialism" is loosely defined as direct transfers of assets from the State, we have massive socialism in this country already. For Big Wall St, Big Pharma, Big Oil, Big Military, Big Incarceration, Big Surveillance. But propose it for Big Citizen and you will get shouted down and shamed as some kind of pinko.Kathleen Smith , December 23, 2017 at 8:07 am
At a major bank in the late 80s, I heard the Controller describe the ideal credit card customer: the one with account just below the credit limit who makes the minimum monthly payment a few days late.JEHR , December 23, 2017 at 11:57 am
I agree with all that Michael Hudson has to say -- only problem is that the bankers have been so effective in dividing and conquering the genernal public that they can't see who the real enemy is. We have middle class people hating those that have been set up and abused by a corrupt banking establishment that many in this country actually blame the victims. Question is how is this all going to end? and what can we do to stop the world take over by a corrupt banking elite?OpenThePodBayDoorsHAL , December 23, 2017 at 3:43 pm
I have come to believe (from my reading) that the bankers have successfully used algorithms to speed up computing in order to make a profit no matter what the markets are doing. The AI of their machines does not have an ethical basis or empathy for those who lose money. The financialization of the economy is part of the role that AI performs in the profiteering of the bankers and other financial institutions. That I suppose is the first step to using AI algorithms to achieve the goal of the banker: to always and forever make a profit. Watch AI move into other areas for the same profitable purpose.Arizona Slim , December 23, 2017 at 8:12 am
It's much bigger, and much worse, than you describe:
https://thebaffler.com/salvos/oculus-grift-shivaninilavar , December 23, 2017 at 2:04 pm
How is this all going to end? Well, it's going to end because of people like us. We're questioning the current way of the world, and that's the first step in changing it.Sam Adams , December 23, 2017 at 8:25 am
Any DEBT which cannot be paid, will NEVER get paid (Hello Greece!) will be resolved by default and or Bankptcy as shown in history!
2008 was just a walk in the park!Carla , December 23, 2017 at 2:28 pm
I love the irony: "And Forgive them their Debts: Credit and Redemption will be available for purchase just in time for Easter on Amazon."
BravoKaren , December 23, 2017 at 9:09 am
If only Michael Hudson would decline to feed the Amazon beast!Henry Moon Pie , December 23, 2017 at 9:13 am
What a fascinating analysis, thank you!Jim Haygood , December 23, 2017 at 9:26 am
It's best to be cautious when making any kind of assertion about "the Bible says " or "Jesus believed ." The Hebrew bible is an amalgam of many different, often conflicting theological and moral points of view. The Gospels reflect that diversity of thought with some non-Semitic strains added as well.
The Ten Commandments provide a good example of this. The reason given for honoring the Sabbath in Exodus 20:
for in six days the Lord made heaven and earth, the sea, and all that is in them, and rested the seventh day
but in Deuteronomy (i.e. the "Second Law" in Deuteronomy 5), it's
You shall remember that you were a servant in the land of Egypt, and the Lord your God brought you out thence with a mighty hand and an outstretched arm
The Exodus version's rationale is drawn completely from awe for YHWH and his creation, but the Deuteronomist asks the Sabbath observers to think empathetically by remembering their ancestors' (mythical) enslavement.
Another example is the Deuteronomist's amendment of the law of debt slavery. The Exodus version did limit debt slavery to 7 years (Exodus 21:2), but D goes further:
And when you send a male slave[b] out from you a free person, you shall not send him out empty-handed. Provide liberally out of your flock, your threshing floor, and your wine press, thus giving to him some of the bounty with which the Lord your God has blessed you. Remember that you were a slave in the land of Egypt, and the Lord your God redeemed you; for this reason I lay this command upon you today.
Prophets like Micah and Amos took the D point of view even further, issuing prophecies of condemnation for the rich and compassion for the poor, but the compiler of Proverbs, while extolling moderation, offers a perspective respectful toward the rich and powerful as long as they behave decently.
These differences persist into the time when the Gospels were written. Luke-Acts clearly reflects the D/Prophetic strain. While Matthew's Sermon on the Mount (Matthew 5) contains only blessings, Luke 6 includes curses:
But woe to you that are rich, for you have received your consolation.
25 "Woe to you that are full now, for you shall hunger.
"Woe to you that laugh now, for you shall mourn and weep.
26 "Woe to you, when all men speak well of you, for so their fathers did to the false prophets.
Where did the historical Jesus line up in this millennia-old debate? There's not that much firm evidence either way. Dominic Crossan, relying on gospels outside the canon, tries to make a case for a revolutionary Jesus, but a strong argument can also be made that Jesus didn't care much about earthly politics and socio-economic issues because he believed the end of the world was near.nilavar , December 23, 2017 at 2:09 pm
After the next recession (which I have penciled in for 2019-2020), US fiscal deficits will rise to the $1.5 to 2 trillion level and stay there. Should Trump serve two terms, federal debt will reach $30 trillion, and by then will constitute 130 to 150% of GDP.
At this point Amerisclerosis sets in, growth being impossible as debt service paralyzes any former dynamism in the corrupt and petrified imperial empire.
The Washington DC regime has two ways of defaulting: outright (hard) default, or soft default via inflating away the principal. Naturally politicians will prefer the latter, as it may permit milking a few more years out of their hollowed-out Potemkin economy.
WWJD -- what would Jesus do? Long gold, short bitcoin ought to be a pretty good "set and forget" trade whilst awaiting the Second Coming, though it may be a bit early yet.The Rev Kev , December 23, 2017 at 6:43 pm
Japan's DEBT to GDP ratio is over 300% but it is still here!
'Japanification' to the rescue!
DEBT and QEs to infinity! There are over 8-9 Trillions of Global Sovereign bonds with NRP!ChiGal in Carolina , December 23, 2017 at 9:30 am
What would Jesus do? We know exactly what Jesus would do! Remember him clearing out the money-lenders from the temple? There is your answer right there. Today he would go into the central banks, kick a** and take names after clearing them out. The big banks would then find themselves under the gun without federal backup which mean that they could be shrunk small enough to drown in a bath tub.marieann , December 23, 2017 at 1:26 pm
I seem to recall in one of the mainstream Protestant churches I went to as a child, when we recited the Lord's prayer we DID say " and forgive us our debts as we forgive our debtors".
In another, we said, "forgive us our trespasses, as we forgive those who trespassed against us". That might've been the Winnetka Congregational Church–oh, that property owning legacy of our founding fathers!
Not really up on my biblical exegesis this morning (it's B.C. here: Before Coffee), but don't we "sin" against God? As opposed to our fellow mortals, I mean.Dan Lynch , December 23, 2017 at 9:43 am
Yes, I remember it was said that way also, not in the catholic church I went to but Protestant ones.
I just googled it and there are versions that speak about debt.
I find this article very interesting.
Being non religious now I could get behind a Socialist religious figurejsn , December 23, 2017 at 10:10 am
I like Hudson and agree with much of his philosophy, but I don't think his book will change many minds because religion has nothing to do with logic.
If you want to make a moral or economic case for debt forgiveness, fine, but if you start talking about what Jesus really believed then you're wading into religion and most religious people's minds are already made up on that subject, so I don't think this tactic is a useful approach.
As one of my right wing friends said in response to Hudson's article, "liberation theology has already been debunked." Well, in my friend's mind it has been debunked so that's all that matters.
In my mind all religion is bunk so I am not going to defend Hudson's theology.
Ditto with the recent debate over Steve Keen's "theses." Just leave religion out of economics, OK?mpalomar , December 23, 2017 at 10:55 am
We are all born in ignorance, religion is what we call earlier concatenations of human perception and memory that sustained societies across generations. The current religion, the one we call science, has exploded the human population to a mass the ecosphere cannot long support. Science, for all its knowledge has failed to provide anything remotely approaching a sustainable society or the politics that might create one. Science provides no wisdom, only knowledge.
It's a long game: minds that are are made up; minds yet to be will form around the ideas presented them.
An argument can be made we no longer have enough time.jsn , December 23, 2017 at 1:02 pm
Interesting points. Yet if science provides knowledge how can it be possible that it does not lead to wisdom. Philosophy, wisdom, religion and science are all bundled or linked, science being the latest iteration. Is it possible that there is such a clear, distinct division between wisdom and knowledge? Wisdom must be a product of knowledge as it is hard to imagine wisdom that does not conform to knowledge.
It is a long game but our individual lives are played out on a different time reference. Keynes of course famously acknowledged this, regarding the useless task of economists if they do not recognize the human time frame in their theories and calculations.
Civilization's tragic but expedient go-to-move is the ever prevalent dismissive shrug of complicity elite consensus employs to excuse the generational destruction visited by poverty and war because the march of history must proceed at a desultory stroll in relation to the span of a human life.
It does appear we no longer have time and probably never have.Jamie , December 23, 2017 at 11:27 am
For some time I've wondered if life itself isn't just an exhilarating acceleration of entropy with consciousness being a kind of waste heat.
It denies us free will, but when you look at how we treat one another at scale and the curves for population and energy use it's hard to avoid the comparison to bacteria in a petri dish.
But I still cling to free will understanding it might be an illusion!jsn , December 23, 2017 at 12:45 pm
Who is the "we" you refer to? Religion is simply codified superstition. It is a parasitic excrescence of stable societies, not the cause of their stability. Without the science you deplore you would not be able to criticize science for not achieving the sustainability you claim to value. Sustainability was not a thing until the science of ecology made it so. If you think you can make an argument that we don't have enough time to be rational, go ahead and make it. But "hurry up and abandon science because we only have time for superstition before the world ends" does not sound like a promising argument to me. By the way, if you attempt the argument I suggest you start by distinguishing science from technology and the ability and knowledge to do something from the political decisions to do (or not do) what science tells us is in our power. The same science that gave us the green revolution and the ability to support a huge global population has also given us birth control and the ability to adjust the size of our population to any value we choose. It is not science's fault if we make poor choices.jsn , December 23, 2017 at 1:14 pm
What did you know when you were born? There are embedded assumptions about me in almost every line you wrote.
I don't deplore science, I'm just humble about what it can achieve. It has no agency, only people do. People made science so science can hardly be better than people, which gets us back to the problem of how to get people to sustain the ecology necessary for the species.
Why are you proposing to abandon science? I didn't. I simply said that it will not cause us to change our collective agency, it can't, it only has agency through us.
Additionally, there is decent science on cognitive bias that suggests, as the reader I was responding to did, that rational arguments don't change minds. I accept that science. Ipso facto, as you finished "It's not science's fault we make poor choices", with which I completely agree. It won't be science's success on the outside chance we make some good ones. That is my point: it is a political issue not a scientific one.
The religions you call superstition, while incorporating a great deal about the material world that science has proven (within a certain tolerance) false, also include a great deal about human psychology integrated into time scales significantly longer than any individual human life.
I chose a poor metaphor in "the current religion, the one we call science" that sidetracked my intent, but science can no more solve our problems for us than god.mpalomar , December 23, 2017 at 12:53 pm
Second to last para should have read:
The religions you call superstition, while incorporating a great deal about the material world that science has proven (within a certain tolerance) false, also include a great deal about human psychology integrated into time scales and societies significantly larger than any individual human life that are both true and wise.jsn , December 23, 2017 at 1:05 pm
Perhaps scientific hypothesis is codified superstition. An indefatigable and self perfecting method for discerning the universe, here on earth employed by a cognitively limited and imperfect biological organism.
As an atheist of sorts, the definition that religion, "is a parasitic excrescence of stable societies" strikes me more a definition of economics, particularly the capitalist incantation and that science operating without parameters of elements of religion and philosophy, would be useless, impossible or possibly fatally employed, without the admittedly meager ethical constraints applied currently.jrs , December 23, 2017 at 12:23 pm
It has for a long time seemed to me that only "true believers" could have the confidence to throw out the entire body of something as ancient, vast and polyvalent as "religion".makedoanmend , December 23, 2017 at 2:25 pm
Maybe socialism really truly was the best shot at an belief system for how humans should live in the modern world.
While science is part of our knowledge of the world and it is necessary for this level of biosphere destruction, and certainly it's technologies are part of our life, I don't think it really informs the current VALUE system that much. I think the current value system is informed almost entirely by brutal capitalism, the ideology of mammon and wealth makes right period.Thuto , December 23, 2017 at 6:36 pm
Science and religion are not equivalent, and I have yet to come across a scientist who claimed it to be so.
Religion is a belief system and has been useful system of inquiry to many people in present and past history. There may be some scientists who promote some sort of technophilia future but they are in the company with many non-scientists.
Many people often conflate those who hype Technological fixes for all social ills with strictly scientific enquiry. Technological fantasies and science are not equivalent.
Science is, at its basis, a method of inquiry based upon continual observations, collection of data and the experimental method. Scientific inquiry does not rest upon predicated truths but rather that ultimate truths are not known. Every law or theory, after rigorous testing, becomes the basic dogma for future hypotheses and new experimental endeavours. The scientific method is itself tested by using laws and theories to predict future events; Newtonian physics being a case in point. When theories lose their ability to predict future events with accuracy they are either modified or discarded. Sometimes, we just have to live with seeming contradictory conditions as between differences in Newtonian and quantum physics; yet Newtonian physics theories and practices are still valid at the scales in which we Homo sapiens operate. They are not based upon belief but upon practice.
Nor does science try and engineer social structures – such as controlling populations. That is not the role of science or scientists. Science merely records the data and tries to predict the consequences of changing weather patterns, farming practices or population dynamics. However, these models are very complex. The job of scientist is to try and convey the information but scientists, like all the rest of us, operate in a political world.
And for those who are believers in a religion, I wish you a most happy holiday and success in your spiritual endeavours.jrs , December 23, 2017 at 12:13 pm
"And for those who are believers in a religion " Thank you for this statement, it's representative of true humility at work. While you do not state your religious belief system (or if indeed you have any), you're not dismissive of beliefs that others might hold as "codified superstition" (as one commentor does above). Deriding those who may believe that there's some intelligent consciousness that underpins life in the universe as superstitious is to suffer from a type of hubris. Live and let live, and this applies as well to religious fundamentalists of all stripes who've made it their mission in life to "save" others. In matters of faith (or lack thereof), one must always keep their own counsel in my view.Davidh J. , December 23, 2017 at 1:35 pm
I don't know if it's going to convince anyone, but it's not just a religious question but a historical one, only people spend their whole lives studying this stuff (how to interpret the Bible based on the culture and language of the time etc.), so while I like Hudson I think he may be out of his depth here.nilavar , December 23, 2017 at 2:17 pm
Hudson's been studying this for a long time.
Lol. Fat fingers: spelled my name wrong: David J.Norb , December 23, 2017 at 12:34 pm
What about DEBT in far Easter religions – Hinduism. Buddhism, Janism, Shinto etc?
Hinduism (1. 3Billions+) is at least 4-5 thousand years old!freedeomny , December 23, 2017 at 9:44 am
What is the nature of Political Power? In order to rule society, public sentiment must be controlled and directed in a certain trajectory. Political and Spiritual power are dependent and cannot be separated. When they are, failure ensues.
The contemporary world is in the midst of a spiritual/religious crisis. The human mind and soul need an anchor in order to deal with the chaos inherent in the universe. What is human history other than one long chain of events illustrating humanities efforts to deal with this predicament.
Belief in a righteous cause, rooted in actual experience of daily life is what all religions are based on. Humanity is characterized by being builders and myth makers. When the myths fail to provide plausible explanations for life's struggles, societal collapse or new possibilities- new myths- must be undertaken. At the very least, a reinterpretation. Building cannot occur without a viable supporting myth.
It seems to me that humanity needs to reexamine spirituality more than ever- not abandon it. The world cannot be left to fools and charlatans.Karen , December 23, 2017 at 9:55 am
Jesus as social activist .I like it!diptherio , December 23, 2017 at 10:40 am
I credit the Catholic church with developing my social conscience–back in the 1970s, when most pastors were old white men. It was a message delivered clearly and repeatedly.
Despite all of the other disappointments and hypocrisies we have seen in the years since, I do think that the church leaders I knew were sincere in this regard. In fact, I have always viewed this as the important contrast vis a vis Protestantism.
Though I am no theologian, so probably don't know what I'm talking aboutcnchal , December 23, 2017 at 9:58 am
My mother attends a United Methodist church whose minister is an ex-Catholic nun, who decided she wanted to deliver sermons rather than receive them. While not real big on organized religion myself, I have been impressed by how much work they put into actually helping people. They built a whole facility in their basement for homeless people to come in a couple times a week, take a shower, shave, and get re-upped on toothpaste and whatnot. They definitely seem to take the "whatsoever you do unto the least of these, you do to me" line much more seriously than the congregations and leadership of other United Methodist churches Mom's attended, so maybe there is something to your thoughts on Catholic/Protestant differences in this area although, I have a feeling that things might be way different in, for instance, AME churches down South.knowbuddhau , December 23, 2017 at 12:45 pm
. . . the attempt of society to cope with the fact that debts grow faster than the ability to pay ," . . .
Debt is the ultimate self licking ice cream cone. To pay off a debt and the interest implies that society as a whole is required to take on ever greater debt. From the ephor's (thank you knowbuddhau) perspective a perfect system.Help Me , December 23, 2017 at 10:03 am
You're welcome. Still a bit mindblown by that.
ISTM a SLICC is a perpetual motion machine. Creditors can turn people into them with debt + interest. It's like some kind of special purpose vessel you can get in, but can't disembark, and it never gets you to the yonder shore like they promised. All you can do is row yourself to death.
I kinda think Jesus was working on more than one level. I think he had an insight that threatened the PTB of his time with disintermediation from between people and the divine.
The way I see it, the Gospel as I've understood it never got out. The most threatening idea was safely encapsulated in the personage and later cult of Jesus the Superfreak. I've always understood it to be the breaking of this taboo that made him such a threat to the PTB.
If we're all related to divinity as offspring to parent, then we all share in divinity. No one is any more divine than anyone else. A lot hinges on the article in a specific phrase.
Did he say, "I am *a* son of god," or did he say "I am THE son of god?" According to Alan Watts, the Greek article is indefinite. The whole idea of a special lineage exceptionally favored by the cosmic PTB (and of course innocently promulgated by its beneficiaries) obviously comes straight outta our primate past. As applied to modern human affairs, it's absurd.
No, I think he said, we're all worthy.
Before this, the only way I thought of Jesus in relation to money was, of course, overturning the tables in the temples. I am in all ya'll's virtual debt. ;-)jrs , December 23, 2017 at 12:40 pm
End games, potential outcomes, so many possibilities.
Questions many would like to see answered:
What do the accumulators do with all that wealth?
When they acquire more than they can possibly spend, why acquire?
How much acquisition is to seek power over others?
What has happened in the past to acquirors and other power-seekers?
Will this current phantasm end in a Jubilee?Carolinian , December 23, 2017 at 10:04 am
I believe at a certain point wealth acquisition is all about power over others, if only more people clearly saw it that way.
One wants money to meet: basic needs, then a few consumer toys and a tiny bit of security, a little more security (get a 401k), then leisure and autonomy (win the lottery and quit your job!). Normal non-rich people can relate to these impulses, as they are basic human drives from survival to self-actualization. Though normal non-rich people's best collective shot at them would be socialism where there would be more economic security, and more autonomy, and more leisure FOR ALL.
But beyond a certain point money is ultimately about a sadistic drive for power over others. People need to see rich people for the sadistic f's they are and their hoarding of money proves it. They won't give it up because they have a sadistic drive to rule over others.JEHR , December 23, 2017 at 12:03 pm
Great stuff. We lapsed Baptists remember one Biblical precept–apparently not mistranslated–from our Sunday school lessons: "money is the root of all evil." Per Hudson it might be interesting to speculate how many other of the world's historic sins boil down to money–slavery, racism (competition between underclass groups), antisemitism. In A Distant Mirror Barbara Tuchman wrote that the French medieval kings would declare a personal debt jubilee from war debts by encouraging the masses to launch a pogrom. No more creditors meant no more debt. During the pre WW 2 Nazi period Hitler said that the Jews were free to leave as long as they left their possessions behind.
Of course in current times autocrats no longer have to reconcile their behavior with traditional religion since it is widely in decline. Instead they invent new religious beliefs, based on failed economic theories.Carolinian , December 23, 2017 at 12:59 pm
See here .lyman alpha blob , December 23, 2017 at 10:22 am
Yes, I know. In fact that's the standard comebacker for defenders of the Prosperity Gospel .they don't love money. Rather they, like Lucy in Peanuts, just want what's coming to them.
I'd say the short form versus the long form is a distinction without a difference. See Michael Hudson above.diptherio , December 23, 2017 at 10:44 am
Never much enjoyed going to church as a kid but I did have to go frequently and absorbed a lot whether I liked it or not. Every so often we would go to a service out of town and they would recite the lord's prayer with 'forgive us our trespasses as we forgive those who trespass against us'. It always sounded off to me and didn't exactly roll of the tongue. Our church used 'debt' and 'debtors' which in retrospect I'm quite grateful for.EyeRound , December 23, 2017 at 11:35 am
We always used the "trespass" version, growing up, so I thought for a long time that this was all to do with how to handle people in your front yard, or hunting on your acreage without permission.jrs , December 23, 2017 at 12:53 pm
Yes, indeed. This made me think:
If the (older) European cultures confounded "debt" with some notion of "sin" as with the German word "Schuld," then the newer American version is to confound "debt" with "real estate."
Hudson also has plenty of insights regarding the reciprocity between banks and land ownership.
So here's another question, the upshot of these 2 thoughts: could it be that Americans know, subliminally, that owning land is sinful?Darius , December 23, 2017 at 10:59 am
perhaps it is, or perhaps merely owning land more than meets one's own needs is sinful (being a landlord – ie a rentier), but certainly humans lived most of their time on earth without land ownership at all.Synoia , December 23, 2017 at 6:33 pm
Debts is the King James Version Lord's Prayer. We say "debts" in my church.
Hudson's approach is appealing. It would be more useful if he cited chapter and verse. Perhaps the book does.Steven Bailey , December 23, 2017 at 10:54 am
Debts is most certainly NOT in the King James version of the Lord's prayer.
It is "trespass." We recited the Laord's prayer at school once a day from age 5 to 18. It sort of sticks after a few recitations.
I can also go to a Church of England service, and automatically say the refrains after the Vicar start them.
The programming is both interesting and a little frightening.flora , December 23, 2017 at 11:00 am
Puerto Rico really needs a "debt jubilee"! for Christmas.Robert McGregor , December 23, 2017 at 12:13 pm
Great post. Thank you.
To file in the category of "the more things change ":
Last year's prez primaries were very much about the current neoliberal economic system enriching the .01% and the growing indebtedness and despair of the 99%, imo. And now we see the Dem estab pushing, imo, a sex hysteria as the greatest destructive force that needs to be addressed, while ignoring the destructive force of neoliberal economics and debt and deaths from despair. The notion of sin is again transferred from economics to sex.Mark P. , December 23, 2017 at 1:18 pm
> @flora "And now we see the Dem estab pushing, imo, a sex hysteria as the greatest destructive force that needs to be addressed, while ignoring the destructive force of neoliberal economics . . . "
Amazing the Dems are now doing the age-old distraction of diverting the discussion to sex rather than economics. I thought just the political right does that! Ancient creditors changed the discussion from "economic unfairness" to "sexual sins." Modern US Republicans changed it from "economic unfairness" to social issues like abortion, and sexuality. So why are the Dems doing the same? Yves Smith has talked about the #METOO hysteria being a rich women's movement. The news is about movie star women being wronged. Maybe it's just a "Maslow hierarchy" sort of thing. When you are a millionaire movie star–or an affluent pundit–then you can worry about being sexually harassed in your past. If you're a waitress, your economic survival is foremost in your thinking. Economic class determines taste and worry.Rates , December 23, 2017 at 11:05 am
the Dems are now doing the age-old distraction of diverting the discussion to sex rather than economics. I thought just the political right does that
The Dems are the political right. The Reps are the far right.Ian , December 23, 2017 at 12:13 pm
I don't think the rich has any objection to debt forgiveness. They already own almost everything anyway. Heck, once debt forgiveness happens, they'll take more debt and then ask for another round of forgiveness. A couple of rounds like that and they'll really own everything. Hurrah!!!
Foreclosure though for everyone will I think wipe out the rich as well since they sure have debts up the wazoo.jrs , December 23, 2017 at 12:56 pm
This is the key. Debt forgiveness for the right people, the rich.lyle , December 23, 2017 at 12:11 pm
well it might not be sufficient, probably also need wealth re-distribution from a tiny minority to the great majority.DJG , December 23, 2017 at 12:26 pm
BTW what is the reading in the oldest greek gospels, and for comparison if avaiable the Syriac gospels of the Nestorian churches (Syriac was a much closer language to Aramaic than greek)
Likewise the reading in the Hebrew language version versus the Septuigant? I maintain that even if you belive god inspired the original texts sinful humans translated it and in the old days copied it. So the version we have today may or may not be close to the original.Mark P. , December 23, 2017 at 1:08 pm
I realize that this is an excerpt from the book, but the idea that sin and debt are equated in the Bible is off. There is no mention here of hamartia, a Greek term that was used for sin.
To quote Wikipedia:
"Hamartia is also used in Christian theology because of its use in the Septuagint and New Testament. The Hebrew (chatá) and its Greek equivalent (àµaρtίa/hamartia) both mean "missing the mark" or "off the mark"."
So rather than sin as a kind of status, the Bible defines sin as not hitting standards of good behavior. This is a long way from debt, and the word hamartia isn't uncommon in the Bible.
Also, the article brushes up against the idea of poverty in Catholicism, which leads inevitably to il Poverello, Saint Francis, the "Poor Guy" from Assisi. In Catholicism, poverty doesn't ennoble. Poverty clarifies, because it removes possessions as a distraction. There is a famous legend of the "conversion" of Saint Francis, which was a long time coming. He took off his clothes in church and gave them away. That isn't nobility. It's a clarification. In return for being un-distracted, Saint Francis claimed a whole enchanted / sacred cosmos, Brother Sun, Sister Moon, the famous birds, Brother Wolf of Gubbio.
The central issue that Hudson mentions here (and likely much more so in his book) is the deterioriation of religion in the U S of A into "American Religion," which brays about being saved, is uncharitable, doesn't know the bible or church history, has no environmental ethic (unlike the Franciscans), and is now being degraded further by U.S. free-market fundamentalism. As a bad Catholic and a bad Buddhist, I am highly skeptical of the tune Amazing Grace and its many claims on the godhead.Rick , December 23, 2017 at 12:40 pm
I am highly skeptical of the tune Amazing Grace
But are you aware that the song's author, John Newton (1725-1807), was originally a slave ship captain, then experienced spiritual conversion and eventually renounced the trade, finally becoming an abolitionist and an Anglican priest? Earlier, he'd been press-ganged in the Royal Navy, during which time he received eight dozen lashes and then later was marooned in Sierra Leone, and was himself made a slave of a slaving tribe there.
Make of all that what you will, but there was probably something real there originally.Jfree , December 23, 2017 at 1:01 pm
"banning absentee ownership" – this would be a great idea for intellectual property. The creator gets protection for some set period (like patents), but it is non-transferrable. Creators get compensated, and society benefits after the set period expires.
I'm not holding my breath .Juliania , December 23, 2017 at 2:17 pm
I've always read the Bible in economic terms too so there's stuff to chew on here. But I've interpreted the Jesus story more narrowly. It is about the Tyrian shekel (the temple tax). Not legal tender at the time for anything but the temple tax – so the Sadducees basically had monopoly ownership. Distributed out to people to pay their temple tax via a raucous appearance of showy but fake competition (the moneychangers) – but the terms (exchange rate basically) are really controlled by the monopolists behind the curtain. And like any Monopoly101, they presumably screw people over time (but need to know more about prices of stuff then – were currencies being debased?). All justified/rationalized intellectually by the Pharisees then.
The problem is – the Tyrian shekel has the image of Baal on it. When Jesus overturns the money tables and then gets shown a coin – the coin he is actually commenting on is the shekel (render unto Baal what is Baals and unto God what is Gods) not the denarius (render unto Caesar what is Caesars and unto God what is Gods)
Read it that way – and he is cleverly accusing the entire establishment of serious blasphemy and exploitation of the Jewish people and directly threatening their business model. Easy to understand why it later gets written down as 'denarius' after the temple is destroyed and the message is no longer in Judaea (or even within Jewish community in diaspora) – but the real message also gets lost with thatJuliania , December 23, 2017 at 2:03 pm
Not true unless you discount the text and archeological facts completely, which I guess you do. The common coinage of the time would be of the empire, which was of Rome.Keynesian , December 23, 2017 at 5:50 pm
I love Michael Hudson, but he is not quite correct here about Jesus, at least as far as this article presents his argument. We know Jesus best through the writings of his followers, mainly the four evangelists, Matthew, Mark, Luke John.
The two who give us an explanation of what we call the Lord's prayer are Matthew and Luke, and the earliest texts are written in koine greek, not hebrew. Indeed, Matthew first uses "debt" but follows his account of the prayer immediately with an explanation that doesn't use that term, thusly:
" for if you forgive men the tresspasses (paraptomata) of them, your heavenly father will also forgive you, but if you do not forgive men, neither will your father forgive your trespasses ( paraptomata) "
My big dictionary translates the above greek word as "false step" or "falling from the right way."
Professor Hudson has an economist's point of view, as does this forum, and that's perfectly fine – Matthew was a tax collector after all. But Jesus was not. The term "debt" in this instance can be likened to the use of the word "seed" in the parables. The prayer uses a narrow focus that ought to be understood in a larger sense.
Luke's version of the prayer makes this expanded meaning very clear, and that is why I prefer the word "trespasses". ( Also it sounds better and can be dwelled upon longer when one prays or sings it.)
"Synoia , December 23, 2017 at 6:23 pm
I appreciate Dr. Hudson referencing the Christian Old and New Testament about money and debt. Christianity has become so perverted in our modern times that it now represents the opposite of its original principles. And Dr. Hudson is in good company as an economist alluding to the New Testament about economic issues.
In the second chapter, sixth paragraph, of Capital Vol. I , Karl Marx's very first introduction of the concept of money is followed by a quote from the New Testament book of Revelations.
The social action therefore of all other commodities, sets apart the particular commodity in which they all represent their values. Thereby the bodily form of this commodity becomes the form of the socially recognised universal equivalent. To be the universal equivalent, becomes, by this social process, the specific function of the commodity thus excluded by the rest. Thus it becomes –money. ―Illi unum consilium habent et virtutem et potestatem suam bestiae tradunt. Et ne quis possit emere aut vendere, nisi qui habet characterem aut nomen bestiae aut numerum nominis ejus.‖ [―These have one mind, and shall give their power and strength unto the beast.‖ Revelations, 17:13; And that no man might buy or sell, save he that had the mark, or the name of the beast, or the number of his name.‖ Revelations, 13:17.](Apocalypse.)
Marx is suggesting that money is analogous to the Christian belief in Revelation's "Mark of the Beast." Of all the criticisms of Marx, one would never believe that he would sometimes point to the New Testament while discussing economics. This is because hardly anyone reads Marx, or the Bible for that matter. Ironically, modern American Right-wing Christianity is corrupted by the "Prosperity Gospel" cult and views money as the ultimate good, or at least its possession a sign of godliness, when everything in its own dogma says something else. Could a Christian today proclaim with conviction, "Money is the Mark of the Beast!"?financial matters , December 23, 2017 at 6:56 pm
"Right Wing Christianity" is surely an oxymoron?
I refer to the "eye of the needle" and "rich men" quote in the Gospels."
Quoting Revelations to prove any point about Christ's teachings is specious at best. The Revelations of St John the Device appear as the stick of the Church to be used when the Carrot of Christ's teaching is unsuccessful.
"If you don't do what we tell you you will burn in Hell!!!"
I'd also point out that Christianity as practiced appears mostly as a peasant suppression system:
Priest: (beholden to the local Lord) "You will get you reward after you die"
Unruly peasant: "How do I know that?"
Priest "We've never had a complaint!"
A powerful statement by Marx. He recognizes the importance of a 'money of account' to give 'value' to items but at the same time questions the validity of this value.
We have definitely gotten to the point of too much monetization and lost the social values of collaboration and compassion.
Dec 22, 2017 | www.unz.com
Randal , December 18, 2017 at 8:48 pm GMT@reiner Tor
Destroying the Taliban government, yes. Building "democracy" is just stupid, though. They should've quickly left after the initial victory and let the Afghans to just eat each other with Stroganoff sauce if they so wished. It's not our business.
In fact destroying the Taliban government was both illegal and foolish (but the latter was by far the more important). It seems clear now the Taliban were quite willing to hand bin Laden over for trial in a third party country, and pretty clearly either had had no clue what he had been planning or were crapping themselves at what he had achieved. Bush declined that offer because he had an urgent political need to be seen to be kicking some foreign ass in order to appease American shame.
The illegality is not a particularly big deal in the case of Afghanistan because it's clear that in the post-9/11 context the US could easily have gotten UNSC authorisation for the attack and made it legal. Bush II deliberately declined to do so precisely in order to make the point that the US (in Americans' view) is above petty details of international law and its own treaty commitments. A rogue state, in other words.
But an attack on Afghanistan was unnecessary and foolish (for genuine American national interests, that is, not for the self-interested lobbies driving policy obviously), as the astronomical ongoing costs have demonstrated. A trial of bin Laden would have been highly informative (and some would argue that was why the US regime was not interested in such a thing), and would if nothing else have brought him out into the open. Yes, he would have had the opportunity to grandstand, but if the US were really such an innocent victim of unprovoked aggression why would the US have anything to fear from that? The whole world, pretty much, was on the US's side after 9/11.
The US could have treated terrorism as what it is, after 9/11 -- a criminal matter. It chose instead to make it a military matter, because that suited the various lobbies seeking to benefit from a more militarised and aggressive US foreign policy. The result of a US attack on the government of (most of) Afghanistan would always have been either a chaotic jihadi-riddled anarchy in Afghanistan worse than the Taliban-controlled regime that existed in 2001, or a US-backed regime trying to hold the lid down on the jihadists, that the US would have to prop up forever. And so indeed it came to pass.
Dec 14, 2017 | www.nakedcapitalism.com
December 14, 2017 by Yves Smith Yves here. Notice that Costa Rica is served up as an example in this article. Way back in 1997, American Express had designated Costa Rica as one of the countries it identified as sufficiently high income so as to be a target for a local currency card offered via a franchise agreement with a domestic institution (often but not always a bank). 20 years later, the Switzerland of Central America still has limited Internet connectivity, yet is precisely the sort of place that tech titans like Google would like to dominate.
The initiative described in this article reminds me of how the World Bank pushed hard for emerging economies to develop capital markets, for the greater good of America's investment bankers.
By Burcu Kilic, an expert on legal, economic and political issues. Originally published at openDemocracy
Today, the big tech race is for data extractivism from those yet to be 'connected' in the world – tech companies will use all their power to achieve a global regime in which small nations cannot regulate either data extraction or localisation.
n a few weeks' time, trade ministers from 164 countries will gather in Buenos Aires for the 11th World Trade Organization (WTO) Ministerial Conference (MC11). US President Donald Trump in November issued fresh accusations of unfair treatment towards the US by WTO members , making it virtually impossible for trade ministers to leave the table with any agreement in substantial areas.
To avoid a 'failure ministerial," some countries see the solution as pushing governments to open a mandate to start conversations that might lead to a negotiation on binding rules for e-commerce and a declaration of the gathering as the "digital ministerial". Argentina's MC11 chair, Susana Malcorra, is actively pushing for member states to embrace e-commerce at the WTO, claiming that it is necessary to " bridge the gap between the haves and have-nots ".
It is not very clear what kind of gaps Malcorra is trying to bridge. It surely isn't the "connectivity gap" or "digital divide" that is growing between developed and developing countries, seriously impeding digital learning and knowledge in developing countries. In fact, half of humanity is not even connected to the internet, let alone positioned to develop competitive markets or bargain at a multilateral level. Negotiating binding e-commerce rules at the WTO would only widen that gap.
Dangerously, the "South Vision" of digital trade in the global trade arena is being shaped by a recent alliance of governments and well-known tech-sector lobbyists, in a group called 'Friends of E-Commerce for Development' (FED), including Argentina, Chile, Colombia, Costa Rica, Kenya, Mexico, Nigeria, Pakistan, Sri Lanka, Uruguay, and, most recently, China. FED claims that e-commerce is a tool to drive growth, narrow the digital divide, and generate digital solutions for developing and least developed countries.
However, none of the countries in the group (apart from China) is leading or even remotely ready to be in a position to negotiate and push for binding rules on digital trade that will be favorable to them, as their economies are still far away from the technology revolution. For instance, it is perplexing that one of the most fervent defenders of FED's position is Costa Rica. The country's economy is based on the export of bananas, coffee, tropical fruits, and low-tech medical instruments, and almost half of its population is offline . Most of the countries in FED are far from being powerful enough to shift negotiations in favor of small players.
U.S.-based tech giants and Chinese Alibaba – so-called GAFA-A – dominate, by far, the future of the digital playing field, including issues such as identification and digital payments, connectivity, and the next generation of logistics solutions. In fact, there is a no-holds-barred ongoing race among these tech giants to consolidate their market share in developing economies, from the race to grow the advertising market to the race to increase online payments.
An e-commerce agenda that claims unprecedented development for the Global South is a Trojan horse move. Beginning negotiations on such topics at this stage – before governments are prepared to understand what is at stake – could lead to devastating results, accelerating liberalization and the consolidation of the power of tech giants to the detriment of local industries, consumers, and citizens. Aware of the increased disparities between North and South, and the data dominance of a tiny group of GAFA-A companies, a group of African nations issued a statement opposing the digital ambitions of the host for MC11. But the political landscape is more complex, with China, the EU, and Russia now supporting the idea of a "digital" mandate .
Repeating the Same Mistakes?
The relationships of most countries with tech companies are as imbalanced as their relationships with Big Pharma, and there are many parallels to note. Not so long ago, the countries of the Global South faced Big Pharma power in pharmaceutical markets in a similar way. Some developing countries had the same enthusiasm when they negotiated intellectual property rules for the protection of innovation and research and development costs. In reality, those countries were nothing more than users and consumers of that innovation, not the owners or creators. The lessons of negotiating trade issues that lie at the core of public interest issues – in that case, access to medicines – were costly. Human lives and fundamental rights of those who use online services should not be forgotten when addressing the increasingly worrying and unequal relationships with tech power.
The threat before our eyes is similarly complex and equally harmful to the way our societies will be shaped in the coming years. In the past, the Big Pharma race was for patent exclusivity, to eliminate local generic production and keep drug prices high. Today, the Big Tech race is for data extractivism from those who have yet to be connected in the world, and tech companies will use all the power they hold to achieve a global regime in which small nations cannot regulate either data extraction or data localization.
Big Tech is one of the most concentrated and resourceful industries of all time. The bargaining power of developing countries is minimal. Developing countries will basically be granting the right to cultivate small parcels of a land controlled by data lords -- under their rules, their mandate, and their will -- with practically no public oversight. The stakes are high. At the core of it is the race to conquer the markets of digital payments and the battle to become the platform where data flows, splitting the territory as old empires did in the past. As the Economist claimed on May 6, 2017: "Conflicts over control of oil have scarred the world for decades. No one yet worries that wars will be fought over data. But the data economy has the same potential for confrontation."
If countries from the Global South want to prepare for data wars, they should start thinking about how to reduce the control of Big Tech over -- how we communicate, shop, and learn the news -- , again, over our societies. The solution lies not in making rules for data liberalization, but in devising ways to use the law to reduce Big Tech's power and protect consumers and citizens. Finding the balance would take some time and we are going to take that time to find the right balance, we are not ready to lock the future yet.
Jef , December 14, 2017 at 11:32 amThuto , December 14, 2017 at 2:14 pm
I thought thats what the WTO is for?Mark P. , December 14, 2017 at 3:30 pm
One suspects big money will be thrown at this by the leading tech giants. To paraphrase from a comment I made recently regarding a similar topic : "with markets in the developed world pretty much sewn up by the tripartite tech overlords (google, fb and amazon), the next 3 billion users for their products/services are going to come from developing world". With this dynamic in mind, and the "constant growth" mantra humming incessantly in the background, it's easy to see how high stakes a game this is for the tech giants and how no resources will be spared to stymie any efforts at establishing a regulatory oversight framework that will protect the digital rights of citizens in the global south.
Multilateral fora like the WTO are de facto enablers for the marauding frontal attacks of transnational corporations, and it's disheartening to see that some developing nations have already nailed the digital futures of their citizens to the mast of the tech giants by joining this alliance. What's more, this signing away of their liberty will be sold to the citizenry as the best way to usher them into the brightest of all digital futures.Thuto , December 14, 2017 at 4:58 pm
One suspects big money will be thrown at this by the leading tech giants.
Vast sums of money are already being thrown at bringing Africa online, for better or worse. Thus, the R&D aimed at providing wireless Internet via giant drones/balloons/satellites by Google, Facebook, etc.
You're African. Possibly South African by your user name, which may explain why you're a little behind the curve, because the action is already happening, but more to the north -- and particularly in East Africa.
The big corporations -- and the tech giants are competing with the banking/credit card giants -- have noted how mobile technology leapt over the dearth of last century's telephony tech, land lines, and in turn enabled the highest adoption rates of cellphone banking in the world. (Particularly in East Africa, as I say.) The payoffs for big corporations are massive -- de facto cashless societies where the corporations control the payment systems –and the politicians are mostly cheap.
In Nigeria, the government has launched a Mastercard-branded national ID card that's also a payment card, in one swoop handing Mastercard more than 170 million potential customers, and their personal and biometric data.
In Kenya, the sums transferred by mobile money operator M-Pesa are more than 25 percent of that country's GDP.
You can see that bringing Africa online is technically a big, decade-long project. But also that the potential payoffs are vast. Though I also suspect China may come out ahead -- they're investing far more in Africa and in some areas their technology -- drones, for instance -- is already superior to what the Europeans and the American companies have.Mark P. , December 14, 2017 at 6:59 pm
Thank you Mark P.
Hoisted from a comment I made here recently: "Here in South Africa and through its Free Basics programme, facebook is jumping into bed with unsuspecting ISPs (I say unsuspecting because fb will soon be muscling in on their territory and becoming an ISP itself by provisioning bandwidth directly from its floating satellites) and circumventing net neutrality "
I'm also keenly aware of the developments in Kenya re: safaricom and Mpesa and how that has led to traditional banking via bank accounts being largely leapfrogged for those moving from being unbanked to active economic citizens requiring money transfer facilities. Given the huge succes of Mpesa, I wouldn't be surprised if a multinational tech behemoth (chinese or american) were to make a play for acquiring safaricom and positioning it as a triple-play ISP, money transfer/banking services and digital content provider (harvesting data about users habits on an unprecedented scale across multiple areas of their lives), first in Kenya then expanded throughout east, central and west africa. I must add that your statement about Nigeria puts Mark Zuckerberg's visit there a few months back into context somewhat, perhaps a reconnaissance mission of sorts.
Out of idle curiosity, how could you accurately deduce my country of origin from my name?Mark P. , December 14, 2017 at 3:34 pm
Out of idle curiosity, how could you accurately deduce my country of origin from my name?
Though I've lived in California for decades, my mother was South African and I maintain a UK passport, having grown up in London.Mattski , December 14, 2017 at 3:41 pm
As you also write: "with markets in the developed world pretty much sewn up by the tripartite tech overlords (google, fb and amazon), the next 3 billion users for their products/services are going to come from developing world."
Absolutely true. This cannot be stressed enough. The tech giants know this and the race is on.
Been happening with food for 50 years.
Dec 12, 2017 | www.mit.edu
Today, September 26, thousands of activists are protesting in Prague, in the Czech Republic, against the policies and institutional structures of the International Monetary Fund (IMF) and the World Bank. These protests are the latest action in a growing movement that is highly critical of the neoliberal economic policies being imposed on people all over the world, including those in western countries. As Robert McChesney concisely describes it, neoliberalism "refers to the policies and processes whereby a relative handful of private interests are permitted to control as much as possible of social life in order to maximize their personal profit." The major beneficiaries of neoliberalism are large trans-national corporations and wealthy investors. The implementation of neoliberal policies came into full force during the eighties under Thatcher and Reagan. Today, the principles of neoliberalism are widely held with near-religious fervor by most major political parties in the US and Britain and are gaining acceptance by those holding power elsewhere.
Although the proponents of neoliberalism extol the virtues of free markets, free trade, private enterprise and consumer choice, the effects of neoliberal policies is quite the opposite. In fact, these policies typically result in very protectionist markets dominated by a few trans-national corporations. Many sectors of the economy - ranging from food processing and distribution to the corporate media to aviation - are oligopolies and can be characterized as highly centralized command economies that are only a shade more competitive than the economy of the former Soviet Union. A major theme of neoliberal policies is deregulation and the removal of government interference in the economy. Consistently, such policies are applied in a one sided way, and always in a manner that benefits large trans-national corporations, the most influential entities in policy making. Hence, within neoliberalism as it is actually applied, capital is allowed to roam the world freely with very few restrictions, yet workers are to remain trapped within the borders of their countries. This serves trans-national corporations well, though for some, not well enough. According to Jack Welsh, CEO of GE, he and GE's shareholders would be best served if factories were on barges so that when workers demand higher wages and better working conditions, the barges could easily be moved to a country with more compliant workers. Another component of neoliberalism is the dismantling of the welfare state. Again, in practice, this policy is applied to the majority of the population, who have to accept cut backs in unemployment benefits and health care, while large corporations continue to receive massive subsidies and tax breaks.
The effects of neoliberal policies on people everywhere has been devastating. During the last two to three decades, wealth disparity has increased many fold within countries as well as between countries. In the US, inflation adjusted median wages are lower today than they were in 1973 (when median wages reached their peak) while the wealth of the top 1% of society has soared. One out of every five children in the US lives in a state of poverty characterized by continual hunger, insecurity and lack of adequate health care. This, after almost ten years of a record breaking economic boom. For the poorest people in the world, the situation has become even more desperate. John Gershman and Alec Irwin state in "Dying for growth":
100 countries have undergone grave economic decline over the past three decades. Per capita income in these 100 countries is now lower than it was 10, 15, 20 or in some cases even 30 years ago. In Africa, the average household consumes 20 percent less today than it did 25 years ago. Worldwide, more than 1 billion people saw their real incomes fall during the period 1980-1993. Meanwhile, according to the United Nations Development Program's 1998 Human Development Report, the 15 richest people in the world enjoy combined assets that exceed the total annual gross domestic product of sub-Saharan Africa. At the end of the 1990's, the wealth of the three richest individuals on earth surpassed the combined annual GDP of the 48 least developed countries.
The Thistle won't waste ink on how the wealthy have fared since the mainstream corporate press does a very commendable job in this respect.
Neoliberalism has been a disaster for the environment as well. Despite the growing awareness in the late eighties that the rate of fossil fuel consumption at that time would cause global warming and many other forms of unpredictable and dangerous environmental changes, energy consumption has continued to increase at an alarming rate. This has been facilitated by neoliberal deregulation of environmental protections championed by corporate puppets such as Newt Gingrich and Tom Delay. In their continued quest for windfall profits, for example, corporations such as Ford and GM aggressively marketed (and continue to do so) highly polluting sports utility vehicles (SUVs) while ignoring cleaner and more efficient technologies. This was made possible by loop holes in environmental laws allowing SUVs to be sold that do not meet the emission standards imposed on passenger cars. Consumer Reports Magazine (Nov. pg. 54) noted in 1997, that "the growing popularity of SUVs, has helped make the 1997 automotive model year the least fuel-efficient in the last 16 years". Due to the subservience of government to large corporations, these loop holes are still in place. Today, the qualitative predictions of a decade ago are starting to manifesting themselves. The average temperature of the world has risen over the last decade and for the first time, water has been observed on the polar caps.
One industry that has benefited significantly from neoliberal policies is the biotech industry, though not without potentially catastrophic costs for the majority of the population. While large biotech corporations such as Monsanto and Dupont are aiming for massive profits, the environment and our food supply is irreversibly being altered in the process, creating a situation where large portions of the population and all future generations are subjected to potentially severe and unpredictable health risks. As a way to promote the nascent biotech industry, the Bush administration in the early nineties adopted a policy which held that regulations should not be created in such a way as to be a burden on the industry. The Clinton administration has continued this policy, and today approximately 60% of our food is genetically modified. This transformation of our food supply has occurred with scant public knowledge or oversight. And although genes from viruses, bacteria or arctic fish with anti-freeze properties are inserted into crops, the federal regulatory agencies, with heavy industry influence, maintain that genetically modified foods are no different from crops obtained with traditional breeding techniques and therefore do not need to be approved (unless the transported genes are known to induce a human allergen). Studies investigating the long term health and environmental effects of genetically modified crops are not required by any federal agency and are rarely performed. In this atmosphere of deregulation and concentrated corporate control, it is only a matter of time before a serious biological catastrophe occurs.
What does the IMF and World Bank have to do with this?
The IMF and World Bank were both created at the end of world war II in a political climate the is very different from that of today. Nevertheless, their roles and modalities have been suitably updated to serve the interests of those that benefit from neoliberalism. The institutional structures of the IMF and World Bank were framed at an international conference in Bretton Woods, New Hampshire. Initially, the primary focus of the IMF was to regulate currency exchange rates to facilitate orderly international trade and to be a lender of last resort when a member country experiences balance of payments difficulties and is unable to borrow money from other sources. The original purpose of the World Bank was to lend money to Western European governments to help them rebuild their countries after the war. In later years, the World Bank shifted its attention towards development loans to third world countries.
Immediately after world war II, most western countries, including the US, had 'New Deal' style social contracts with sufficient welfare provisions to ensure 'stability' between labor and capital. It was understood that restrictions on international capital flow were necessary to protect these social contracts. The postwar 'Bretton Woods' economic system which lasted until the early seventies, was based on the right and obligation of governments to regulate capital flow and was characterized by rapid economic growth. In the early seventies, the Nixon administration unilaterally abandoned the Bretton Woods system by dropping the gold standard and lifting restrictions on capital flows. The ensuing period has been marked by dramatically increased financial speculation and low growth rates.
Although seemingly neutral institutions, in practice, the IMF and World Bank end up serving powerful interests of western countries. At both institutions, the voting power of a given country is not measured by, for example, population, but by how much capital that country contributes to the institutions and by other political factors reflecting the power the country wields in the world. The G7 plays a dominant role in determining policy, with the US, France, Germany, Japan and Great Britain each having their own director on the institution's executive board while 19 other directors are elected by the rest of the approximately 150 member countries. The president of the World Bank is traditionally an American citizen and is chosen with US congressional involvement. The managing director of the IMF is traditionally a European. On the IMF board of governors, comprised of treasury secretaries, the G7 have a combined voting power of 46%.
The power of the IMF becomes clear when a country gets into financial trouble and needs funds to make payments on private loans. Before the IMF grants a loan, it imposes conditions on that country, requiring it to make structural changes in its economy. These conditions are called 'Structural Adjustment Programs' (SAPs) and are designed to increase money flow into the country by promoting exports so that the country can pay off its debts. Not surprisingly, in view of the dominance of the G7 in IMF policy making, the SAPs are highly neoliberal. The effective power of the IMF is often larger than that associated with the size of its loans because private lenders often deem a country credit-worthy based on actions of the IMF.
The World Bank plays a qualitatively different role than the IMF, but works tightly within the stringent SAP framework imposed by the IMF. It focuses on development loans for specific projects, such as the building of dams, roads, harbors etc that are considered necessary for 'economic growth' in a developing country. Since it is a multilateral institution, the World Bank is less likely than unilateral lending institutions such as the Export Import Bank of the US to offer loans for the purpose of promoting and subsidizing particular corporations. Nevertheless, the conceptions of growth and economic well being within the World Bank are very much molded by western corporate values and rarely take account of local cultural concerns. This is clearly exhibited by the modalities of its projects, such as the 'Green Revolution' in agriculture, heavily promoted in the third world by the World Bank in the sixties and seventies. The 'Green Revolution' refers to the massive industrialization of agriculture, involving the replacement of a multitude of indigenous crops with a few high-yielding varieties that require expensive investments of chemicals, fertilizers and machinery. In the third world, the 'Green Revolution' was often imposed on indigenous populations with reasonably sustainable and self sufficient traditions of rural agriculture. The mechanization of food production in third world countries, which have a large surplus labor pool, has led to the marginalization of many people, disconnecting them from the economy and exacerbating wealth disparity in these countries. Furthermore, excessive chemical agriculture has led to soil desertification and erosion, increasing the occurrence of famines. While the 'Green Revolution' was a catastrophe for the poor in third world countries, western chemical corporations such as Monsanto, Dow and Dupont fared very well, cashing in high profits and increasing their control over food production in third world countries.
Today, the World Bank is at it again. This time it is promoting the use of genetically modified seeds in the third world and works with governments to solidify patent laws which would grant biotech corporations like Monsanto unprecedented control over food production. The pattern is clear, whether deliberate or nor, the World Bank serves to set the stage for large trans-national corporations to enter third world countries, extract large profits and then leave with carnage in their wake.
While the World Bank publicly emphasizes that it aims to alleviate poverty in the world, imperialistic attitudes occasionally emerge from its leading figures. In 1991, then chief economist Lawrence Summers (now US Secretary of the Treasury) wrote in an internal memo that was leaked:
Just between you and me, shouldn't the World Bank be encouraging more migration of the dirty industries to the LDCs [less developed countries]? ... The economic logic behind dumping a load of toxic waste in the lowest wage country is impeccable, and we should face up to that ... Under-populated countries in Africa are vastly under-polluted; their air quality is probably vastly inefficiently low compared to Los Angeles or Mexico City .... The concern over an agent that causes a one-in-a-million chance in the odds of prostate cancer is obviously going to be much higher in a country where people survive to get prostate cancer than in a country where under-five mortality is 200 per thousand.
And thistle thought that the World Bank tried to extend lives in developing countries, not take advantage of low life expectancy.
How do countries get into financial troubles, the Debt Crisis.
The most devastating program imposed by the IMF and the World Bank on third world countries are the Structural Adjustment Programs. The widespread use of SAPs started in the early eighties after a major debt crisis. The debt crisis arose from a combination of (i) reckless lending by western commercial banks to third world countries, (ii) mismanagement within third world countries and (iii) changes in the international economy.
During the seventies, rising oil prices generated enormous profits for petrochemical corporations. These profits ended up in large commercial banks which then sought to reinvest the capital. Much of this capital was invested in the form of high risk loans to third world countries, many of which were run by corrupt dictators. Instead of investing the capital in productive projects that would benefit the general population, dictators often diverted the funds to personal Swiss bank accounts or used the them to purchase military equipment for domestic repression. This state of affairs persisted for a while, since commodity prices remained stable and interest rates were relatively low enabling third world countries to adequately service their debts. In 1979, the situation changed, however, when Paul Volker, the new Federal Reserve Chairman, raised interest rates. This dramatically increased the cost of debtor countries' loans. At the same time, the US was heading into a recession and world commodity prices dropped, tightening cash flows necessary for debt payment. The possibility that many third world countries would default on their debt payments threatened a major financial crisis that would result in large commercial bank failures. To prevent this, powerful countries from the G7 stepped in and actively used the IMF and World Bank to bail out third world countries. Yet the bail-out packages were contingent upon the third world countries introducing major neoliberal policies (i.e. SAPs) to promote exports.
Examples of SAP prescriptions include:
- an increase in 'labor flexibility' which means caps on minimum wages, and policies to weaken trade unions and worker's bargaining power.
- tax increases combined with cuts in social spending such as education and health care, to free up funds for debt repayment.
- privatization of public sector enterprises, such as utility companies and public transport
- financial liberalization designed to remove restrictions on the flow of international capital in and out of the country coupled with the removal of restrictions on what foreign corporations and banks can buy.
Despite almost two decades of Structural Adjustment Programs, many third world countries have not been able to pull themselves out of massive debt. The SAPs have, however, served corporations superbly, offering them new opportunities to exploit workers and natural resources.
As Prof. Chomsky often says, the debt crisis is an ideological construct. In a true capitalist society, the third world debt would be wiped out. The Banks who made the risky loans would have to accept the losses, and the dictators and their entourage would have to repay the money they embezzled. The power structure in society however, prevents this from happening. In the west tax payers end up assuming the risk while the large banks run off with the high profits often derived from high risk loans. In the third world, the people end up paying the costs while their elites retire in the French Riviera.
It is important to realize that the IMF and World Bank are tools for powerful entities in society such as trans-national corporations and wealthy investors. The Thistle believes that massive world poverty and environmental destruction is the result of the appalling concentration of power in the hands of a small minority whose sights are blinded by dollar signs and whose passions are the aggrandizement of ever more power. The Thistle holds that an equitable and democratic world centered around cooperation and solidarity would be more able to deal with environmental and human crises.
Dec 05, 2017 | www.nakedcapitalism.com
Posted on December 4, 2017 by Jerri-Lynn Scofield By Jerri-Lynn Scofield, who has worked as a securities lawyer and a derivatives trader. She now spends much of her time in Asia and is currently working on a book about textile artisans.
Three Democrats and three Republicans have co-sponsored a resolution, under the Congressional Review Act (CRA), to scuttle the Consumer Financial Protection Bureau's payday lending rule.
CRA's procedures to overturn regulations had been invoked, successfully, only once before Trump became president. Congressional Republicans and Trump have used CRA procedures multiple times to kill regulations (as I've previously discussed (see here , here , here and here ). Not only does CRA provide expedited procedures to overturn regulations, but once it's used to kill a regulation, the agency that promulgated the rule is prevented from revisiting the issue unless and until Congress provides new statutory authority to do so.
As I wrote in an extended October post, CFPB Issues Payday Lending Rule: Will it Hold, as the Empire Will Strike Back, payday lending is an especially sleazy part of the finance sewer, in which private equity swamp creatures, among others, operate. The industry is huge, according to this New York Times report I quoted in my October post, and it preys on the poorest, most financially-stressed Americans:
The payday-lending industry is vast. There are now more payday loan stores in the United States than there are McDonald's restaurants. The operators of those stores make around $46 billion a year in loans, collecting $7 billion in fees. Some 12 million people, many of whom lack other access to credit, take out the short-term loans each year, researchers estimate.
The CFPB's payday lending rule attempted to shut down this area of lucrative lending– where effective interest rates can spike to hundreds of points per annum, including fees (I refer interested readers to my October post, cited above, which discusses at greater length how sleazy this industry is, and also links to the rule; see also this CFPB fact sheet and press release .)
Tactically, as with the ban on mandatory arbitration clauses in consumer financial contracts– an issue I discussed further in RIP, Mandatory Arbitration Ban , (and in previous posts referenced therein), the CFPB under director Richard Cordray made a major tactical mistake in not completing rule-making sufficiently before the change of power to a new administration- 60 "session days" of Congress, thus making these two rules subject to the CRA.
The House Financial Services Committee press release lauding introduction of CRA resolution to overturn the payday lending rule is a classic of its type, so permit me to quote from it at length:
These short-term, small-dollar loans are already regulated by all 50 states, the District of Columbia and Native American tribes. The CFPB's rule would mark the first time the federal government has gotten involved in the regulation of these loans.
House Financial Services Committee Chairman Jeb Hensarling (R-TX), a supporter of the bipartisan effort, said the CFPB's rule is an example of how "unelected, unaccountable government bureaucracy hurts working people."
"Once again we see powerful Washington elites using the guise of 'consumer protection' to actually harm consumers and make life harder for lower and moderate income Americans who may need a short-term loan to keep their utilities from being cut off or to keep their car on the road so they can get to work," he said. "Americans should be able to choose the checking account they want, the mortgage they want and the short-term loan they want and no unelected Washington bureaucrat should be able to take that away from them."
[Rep Dennis Ross, a Florida Republican House co-sponsor]. said, "More than 1.2 million Floridians per year rely on Florida's carefully regulated small-dollar lending industry to make ends meet. The CFPB's small dollar lending rule isn't reasonable regulation -- it's a de facto ban on what these Floridians need. I and my colleagues in Congress cannot stand by while an unaccountable federal agency deprives our constituents of a lifeline in times of need, all while usurping state authority. Today, we are taking bipartisan action to stop this harmful bureaucratic overreach dead in its tracks."
As CNBC reports in New House bill would kill consumer watchdog payday loan rule , industry representatives continue to denounce the rule, with a straight face:
"The rule would leave millions of Americans in a real bind at exactly the time need a fast loan to cover an urgent expense," said Daniel Press, a policy analyst with the Competitive Enterprise Institute, in a statement after the bill's introduction.
Consumer advocates think otherwise (also from CNBC):
"Payday lenders put cash-strapped Americans in a crippling cycle of 300 percent-interest loan debt," Yana Miles, senior legislative counsel at the Center for Responsible Lending, said in a statement.
Prospects Under CRA
When I wrote about this topic in October, much commentary assumed that prospects for CRA overturn were weak. I emphasized instead the tactical error of failing to insulate the rule from CRA, which could have been done if the CFPB had pushed the rule through well before Trump took office:
If the payday rule had been promulgated in a timely manner during the previous administration it would not have been as vulnerable to a CRA challenge as it is now. Even if Republicans had then passed a CRA resolution of disapproval, a presidential veto would have stymied that. Trump is an enthusiastic proponent of deregulation, who has happily embraced the CRA– a procedure only used once before he became president to roll back a rule.
Now, the Equifax hack may have changed the political dynamics here and made it more difficult for Congressional Republicans– and finance-friendly Democratic fellow travellers– to use CRA procedures to overturn the payday lending rule.
The New York Times certainly seems to think prospects for a CRA challenge remote:
The odds of reversal are "very low," said Isaac Boltansky, the director of policy research at Compass Point Research & Trading.
"There is already C.R.A. fatigue on the Hill," Mr. Boltansky said, using an acronymn for the act, "and moderate Republicans are hesitant to be painted as anti-consumer.
I'm not so sure I would take either side of that bet. [Jerri-Lynn here: my subsequent emphasis.]
A more telling element than CRA-fatigue in my assessment of the rule's survival prospects was my judgment that Democrats wouldn't muster to defend the payday lending industry– although that assumption has not fully held, as this recent American Banker account makes clear:
After the payday rule was finalized in October , it was widely expected that Republicans would attempt to overturn it. It's notable, though, that the effort has attracted bipartisan support in the House.
Passage in the Senate, however, may be a much heavier lift. The chamber's vote to overturn the arbitration rule in late October came down to the wire, forcing Republicans to call in Vice President Mike Pence to cast the tie-breaking vote.
I continue to think that this rule will survive– as the payday lending industry cannot count on a full court press lobbying effort by financial services interests. Yet as I wrote in October, I still hesitate to take either side of the bet on this issue.
Dpfaef , December 4, 2017 at 10:53 amGF , December 4, 2017 at 11:02 am
I think this whole article is totally disingenuous. There is a serious need for many Americans to have access to small amount, short term loans. While, these lenders may appear predatory, they do serve a large sector of society.
Maybe you need to read: The Unbanking of America: How the New Middle Class Survives by Lisa Servon . It might be worth the read.Jerri-Lynn Scofield Post author , December 4, 2017 at 11:11 am
Where's the Post Office Bank when you need it. This overturning of the rule is just an effort to stop the Post Office Bank from gaining traction as the alternative non-predatory source of small loans to the people. Most pay day lender companies are owned by large financial players.Wisdom Seeker , December 4, 2017 at 3:23 pm
I agree that's a far better approach and indeed, I discussed the Post Office bank in my October post– which is linked to in today's post. Permit me to quote from my earlier post:
The payday lending industry preys on the poorest financial consumers. One factor that has allowed it to flourish is current banking system's inability to provide access to basic financial services to a shocking number of Americans. Approximately 38 million households are un or underbanked– roughly 28% of the population.
Now, a sane and humane political system would long ago have responded with direct measures to address that core problem, such as a Post Office Bank (which Yves previously discussed in this post, Mirabile Dictu! Post Office Bank Concept Gets Big Boost and which have long existed in other countries.)
Regular readers are well aware of who benefits from the current US system, and why the lack of institutions that cater to the basic needs of financial consumers rather than focusing on extracting their pound(s) of flesh is not a bug, but a feature.
So, instead, the United States has a wide-ranging payday lending system. Which charges borrowers up to 400% interest rates for short-term loans, many of which are rolled over so that the borrower becomes a prisoner of the debt incurred.lyman alpha blob , December 4, 2017 at 3:30 pm
With phrasing like "unbanked" or "underbanked", I worry that you've bought into the banking-industry framing of this issue, which I'm sure is not your intent.
Ordinary people should not need any bank (not even a government or post office bank) for everyday life, with the possible exception of mortgages. De-financialization of the medium of exchange, and basic payments, is something the public should be fighting for.Wisdom Seeker , December 4, 2017 at 3:44 pm
I would consider myself an ordinary person and I pay in cash when purchasing day to day items the vast majority of the time and yet I'd still prefer to deposit my money in a bank rather than hiding it in my mattress for any number of good reasons.
Banks aren't the problem – their predatory executives are.Cary D Berkelhamer , December 4, 2017 at 4:32 pm
But there are, or at least ought to be, safe and secure ways to store money other than by lending it to banks or stuffing it into mattresses. Or carrying wads of cash.
For instance, a debit card (or possibly cell phone) with a secure identity / password can already act as a cashless wallet. The digital cash could be stored directly on the device, and accounted for through something similar to TreasuryDirect, without any intermediaries. But this would require the Federal Government to get serious about having a modern Digital Dollar of some kind (not bitcoin, shudder)diptherio , December 4, 2017 at 11:08 am
Even better would be State Banks. Every state should have one. I believe the State Bank of North Dakota made money in 2008. While the TBTF Banks came hat in hand to our Reps. Of course OUR Reps handed them a blank check and told them to "Make it go Away". However Post Office Banks would be GREAT!!Vatch , December 4, 2017 at 11:19 am
This is the boilerplate argument that always gets brought up by payday loan defenders, and there is a good bit of truth to it. However, what you are not mentioning is that there are already far superior options available to pretty much any person who needs a small, short term loan. That solution is your friendly neighborhood Credit Union, most of which offer very low interest lines of overdraft coverage. I don't mind saying that it has saved my heiny on more than one occasion. Pay check a little late in arriving? No problem, transfer $200 from your overdraft account into your checking account on-line and you're good to go. Pay it back at your convenience, also on-line, at 7% APR.
Payday lenders are legal loansharks. The problems with their predatory lending model and the damage it does to low-income people are well documented. Simply pointing out that there is a reason that people end up at payday lenders is not a valid justification for the business practices of those lenders, especially when there are much better alternatives readily available.Off The Street , December 4, 2017 at 12:10 pm
Payday lenders are legal loansharks.
Very true! There are several web sites that point out how the fees associated with payday loans raise the effective annual percentage rate into the stratosphere, ranging from 300% to over 600%. Here's one:
http://paydayloansonlineresource.org/average-interest-rates-for-payday-loans/a different chris , December 4, 2017 at 12:57 pm
One frustration that I have with legislation in general, and finance legislation in particular, is that it does not tell the truth, the whole truth and nothing but the truth.
In my Panglossian world, I envision a financial services bill that lays out the following:
Define the problem
Unserviced people: X percent( for discussion, say 10% to make the math easy) of people are un-serviced (or under-, or rapaciously-serviced) by conventional financial companies, whether banks, credit unions or other, whatever other is conventionally.
Unserviced and don't want: Y percent of that X percent (say, 50% of 10%, so 5%) doesn't want services.
Unserviced and want: 1-Y percent of that X percent (say, 50% of 10%, so 5%) wants services but can not get them. That could be due to various factors, ranging from bad credit (how defined?, say FICO < 600?) to geographic remoteness (no branches within miles, no internet, precious little slow mail service, whatever).
Within that deemed unserved 5% of the population, what are the costs to serve and what are the alternatives?
What would an honest service provider need to provide service, accounting for credit risks and the like, and still make a profit sufficient to induce investment?
If I knew how to make and add a nice graphic, I'd include a waterfall chart here to show the costs and components of the interest and fees paid in regular and default mode. Sorry, please bear with me as I make up numbers.
Interest at 30%
Less: cost of funds at, say, 10%
Less: personnel, overhead, everything else at, say, 5%
Pre-tax profit: 15%
Default mode costs:
Interest at 275%
Plus: Fees at 25%
Less: cost of funds 20%
Less: personnel, overhead, etc 5%
Less: added default cost not in personnel etc line, say 25%
Pre-tax profit: 250%
In that little example, who couldn't make money at those rates?
Extending the notion of APR and Truth-In-Lending to include payday lenders and anyone else without a brick-and-mortar branch who wants to do business in the US, how about mandating some type of honest waterfall chart as dreamt of above?
Then cross-reference and publicize the voting on finance legislation with the campaign contributions from payday people and their ilk, and layer in the borrower costs and credit scores and other metrics in those Congressional districts and zip+4 codes and census tracts and whatever other level of granularity will help provide any amount of disinfecting sunlight to help see the scattering cockroaches.lyle , December 4, 2017 at 7:33 pm
The problem I suspect is that your "friendly neighborhood credit union" is actually rarely anywhere near the neighborhoods where people who need these kind of loans live.
They don't have cars and mass transit is non-existent or so slow they couldn't get to the Credit Union during business hours, and back again, anyway. That's the problem with expecting Private Enterprise to be a solution for people at the bottom. They don't set up shop where those people live, or the ones that do are not exactly do-gooders.JTMcPhee , December 4, 2017 at 1:04 pm
I just checked and a lot of credit unions let you apply for a loan online, (earlier you can set up membership online). So the issue of transport and time is lessened assuming folks have some form of net access.Wukchumni , December 4, 2017 at 1:08 pm
One might ask why there are millions of people reduced to having to get ripped off by payday and auto-title lenders, to somehow survive from week to week. Maybe because people can't make a living wage? Can't save any money, however prudent and abstemious they may be? Because inter-citizen cruelty and Calvinism are so very strong a force in this rump of an Empire?
Some of the comments here seem to build on the baseline assumption that's part of the liberal-neoliberal mantra, "You get what's coming to you (or the pittance we can't quite squeeze out of you yet)".
diptherio, I am guessing you may mean that there are models of better alternatives readily available, like paying a living wage, a social safety net for the worst off, a postal bank, national health care, stuff like that. I don't see that there are any alternatives actually available to most real people "on the ground."diptherio , December 4, 2017 at 1:27 pm
There is an alternative to excessive payday loans, but only if you're in the military, where it's capped @ 36%.
Why not 36% for everybody?mpalomar , December 4, 2017 at 1:36 pm
You are, of course, correct in that the underlying problem is that so many people are forced to live on so little that they need payday loans in the first place. Thanks for pointing that out.
My point is simply that in the short-term, as a matter of practicality for those of us who don't always make it until payday before running out of money, a CU overdraft account is a very good option.lyman alpha blob , December 4, 2017 at 1:32 pm
Agree. The AB article from October deadpans a description of the ins and outs governing the hellishness of the company town we're living in.sd , December 4, 2017 at 11:14 am
This is a far superior option and thank you for bringing it up. The only problem is most banks and credit unions will not tell you it exists because they make a lot more money if you just keep bouncing checks.
I only learned about it when I worked for WAMU. We were tasked by management with promoting various new products to customers as a condition of being paid a monthly bonus which was the only thing that made the job pay enough to live on. Funny, they never asked us to promote the overdraft line of credit (aka an ODLOC), ever. I do remember one of my managers tell me that circa 2000 or so, WAMUs operating costs for the entire company for the entire year were offset just by the fees they collected off of bounced checks etc.
The fees or interest you pay for using an ODLOC are a small fraction of what you'd pay for bouncing just one check. IIRC, if I overdrew by $200 or so and paid it back on my next payday, the interest was generally less than $1. My local credit union has since added a $5 fee for accessing the ODLOC on top of the interest, but it's still much less than a bounced check fee or interest on a payday loan. I believe that depending on your credit history, you can get an ODLOC of up to $2500 or so which pretty much negates the need for any payday loans.RepubAnon , December 4, 2017 at 11:55 am
A friend of mine was evicted from her apartment because of a payday loan. She failed to pay it off in full quick enough and it spiraled out of control tripling in a very short time. I really fail to see how usury is beneficial to society.FluffytheObeseCat , December 4, 2017 at 12:25 pm
Yes, there's a need for high-interest loans that bankrupt borrowers:
Mom-and-Pop Loan Sharks Being Driven Out by Big Credit Card Companies
Frank Pistone is part of the dying breed known as the American Loan Shark. Not so long ago, the loan shark flourished, offering short-term, high-interest loans to desperate people with nowhere else to turn. Today, however, Pistone and countless others like him are being squeezed out by the major credit-card companies, which can offer money to the down-and-out at lower rates of interest and without the threat of bodily harmJTMcPhee , December 4, 2017 at 12:35 pm
I read Servon's book. It is not a brief on behalf of the payday loan industry. She worked at a couple of payday lenders and explains how they serve the communities they're in, but a few things need to be noted:
The business she was most sympathetic with was a small, local one with only a couple of storefronts, in an east coast inner city. The owner and his help knew the customer base, often by name. Much of her sympathy came from her respect for the women who were dishing out the loans at the windows, not the owners and not the business model. This local joint operated like the most benign of old time pawnbroker/loansharking operation from the early part of the last century.
Most "Cash America" storefront shops (on shabby, midcentury shopping strips in inner ring scuburbs across the US) aren't this decent. They aren't "part of a community" in any sense. And the rates are usurious any way, for all of them.
Thank you to Ms. Scofield for continuing to cover this and related businesses. The upper, cleaner part of our finance industry derives more filthy lucre from these kinds of loan shops than they ever want you to know (sub-prime lending shops, title loans shops . there are a lot of modalities for fleecing the poor and the near-poor nowadays).ger , December 4, 2017 at 12:42 pm
The NC staff must be pleased that it seems like so many subtle apologists for the looters, predators, "intelligence community," and so forth, appear to be turning up here early in the opening of new site posts. I'm guessing the Elite are not exactly quaking in fear that NC's reporting will catalyze some change that might sweep the political economy in the direction of what the mopery would categorize as "fairness," but stillMatthew Cunningham-Cook , December 4, 2017 at 3:15 pm
Raised the dollar definition of middle class and declared a 'new middle class' or could it be 'new middle class' is actually referring to the 'new middle poor'. The former middle class is desperately trying to avoid a plunge into the pits of the 'poor poor'. Payday Loan predators are greasing the handrails.John , December 4, 2017 at 9:32 pm
"Where will the money-changers change money if not in the Holy Temple? Aren't we starving the priests of much-needed revenue? This Jesus guy is totally disingenuous."sd , December 4, 2017 at 11:11 am
In good neo liberal fashion that Jesus dude got exactly what he deserved. The effrontry of that guy to chase those hard working money lenders out of the temple square. Got exactly what was coming to him.perpetualWAR , December 4, 2017 at 12:21 pm
H.J.Res.122 – Providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Bureau of Consumer Financial Protection relating to "Payday, Vehicle Title, and Certain High-Cost Installment Loans".
December 1, 2017
Sponsor Rep. Ross, Dennis A. [R-FL-15] (Introduced 12/01/2017)
Rep. Hastings, Alcee L. [D-FL-20]
Rep. Graves, Tom [R-GA-14]
Rep. Cuellar, Henry [D-TX-28]
Rep. Stivers, Steve [R-OH-15]
Rep. Peterson, Collin C. [D-MN-7]jawbone , December 4, 2017 at 1:44 pm
Ahhh ..look at this list. TWO Florida lawbreakers introducing this banker bill. And one from Minnesota. Y'all know that Jacksonville, FL and St. Paul, MN are the two places where the forgeries continue to be provided to the financial crooks? So, it goes to figure that the lawbreakers are attempting to protect the financial crooks committing forgery in their prospective states! How appro.Mike R. , December 4, 2017 at 1:19 pm
If any of these House critters are "representing" you, time for lots of calls to them.
And thanks, SD, for listing them. I always wonder why our vaunted free press so seldom lists the sponsors of legislation when it's reported on . Hhmm .
m .nonclassical , December 4, 2017 at 1:46 pm
I have mixed feelings about this specific issue.
The larger issue of a grossly skewed economic system is what needs to be fixed.
There will always be people that lack common sense and brains regarding money. There will always be people that will take advantage of that.
I don't know how or why you would try and legislate that away.
We need to move in the direction of solving the biggest problems and not get wrapped up in the little problems.
The numbers above sound horrendous, but 7 billion in profit on 46 billion loaned is 14% return. Credit card companies are worse. 7 billion in profit off of 12 million people is $600 per person. Alot for poor folks I recognize, but not necessarily life shattering for all.
The "system" loves to wrangle around with issues like this (trivial in my mind) so the handful of big ones go unattended.Wisdom Seeker , December 4, 2017 at 3:37 pm
some have apparently not felt it necessary to bail out family members for aggressive, egregious and immediate interest rates and escalations charged by these scammers
but there certainly appears concerted effort by (likely) shills to perpetuate scams (and to discredit Consumer Financial Protection Agency and Liz Warren )
Warren-Sanders 2020Jerri-Lynn Scofield Post author , December 4, 2017 at 8:07 pm
I think there's an error in the original article, where it says:
CRA's procedures to overturn legislation had been invoked, successfully, only once before Trump became president. Congressional Republicans and Trump have used CRA procedures multiple times to kill regulations (emphasis added)
My understanding is that CRA gives Congress the power to overturn executive branch regulations , not legislation (which Congress already can overturn anyway). Is that incorrect?
P.S. It's sad that it might not even matter. Nowadays the public can't tell the difference between regulations (written by unaccountable, unelected officials who take the revolving door back to working at the firms they regulated) and legislation (written by unaccountable, only notionally elected politicians who get paid off in various ways by lobbyists for the same firms)John k , December 4, 2017 at 8:26 pm
You're correct– fixed it! Slip of the fingers there that I didn't catch when I proofread the post. As the rest of the paragraph makes clear, CRA procedures are used to overturn regulations.
Thanks for reading my work so carefully and drawing the error to my attention.Taras 77 , December 4, 2017 at 10:40 pm
Trump loves it
Obomber woulda loved it
She who cannot be named woulda loved it, too.
Time for them all to get over that little spat she did it before trump should appoint her to something useful I bet she'd love secdef
Where is the lovely Debbie Wasserman schultz in all of this? She has not surprisingly been a leading cheerleader for these pay day lender sharks. but hey, what the hey, the lobby money is good!
Inside Casino Capitalism Barbarians at the Gate: The Fall of RJR Nabisco
By Bryan Burrough and John Helyar
Harper & Row. 528 pp. $22.95
In 1898, Adolphus Green, chairman of the National Biscuit Company, found himself faced with the task of choosing a trademark for his newly formed baking concern. Green was a progressive businessman. He refused to employ child labor, even though it was then a common practice, and he offered his bakery employees the option to buy stock at a discount. Green therefore thought that his trademark should symbolize Nabisco's fundamental business values, "not merely to make dividends for the stockholders of his company, but to enhance the general prosperity and the moral sentiment of the United States." Eventually he decided that a cross with two bars and an oval – a medieval symbol representing the triumph of the moral and spiritual over the base and material – should grace the package of every Nabisco product.
If they had wracked their brains for months, Bryan Burrough and John Helyar could not have come up with a more ironic metaphor for their book. The fall of Nabisco, and its corporate partner R.J. Reynolds, is nothing less than the exact opposite of Green's business credo, a compelling tale of corporate and Wall Street greed featuring RJR Nabisco officers who first steal shareholders blind and then justify their epic displays of avarice by claiming to maximize shareholder value.
The event which made the RJR Nabisco story worth telling was the 1988 leveraged buyout (LBO) of the mammoth tobacco and food conglomerate, then the 19th-largest industrial corporation in America. Battles for corporate control were common during the loosely regulated 1980s, and the LBO was just one method for capturing the equity of a corporation. (In a typical LBO, a small group of top management and investment bankers put 10 percent down and finance the rest of their purchase through high-interest loans or bonds. If the leveraged, privately-owned corporation survives, the investors, which they can re-sell public shares, reach the so-called "pot of gold"; but if the corporation cannot service its debt, everything is at risk, because the collateral is the corporation itself.
The sheer size of RJR Nabisco and the furious bidding war that erupted guaranteed unusual public scrutiny of this particular piece of financial engineering. F. Ross Johnson, the conglomerate's flamboyant, free-spending CEO (RJR had its own corporate airline), put his own company into play with a $75-a-share bid in October. Experienced buyout artists on Wall Street, however, immediately realized that Johnson was trying to play two incompatible games. LBOs typically put corporations such as RJR Nabisco through a ringer in order to pay the mammoth debt incurred after a buyout. But Johnson, desiring to keep corporate perquisites intact, "low-balled" his offer. Other buyout investors stepped forward with competing bids, and after a six-week-long auction the buyout boutique of Kohlberg, Kravis, Roberts & Company (KKR) emerged on top with a $109-a-share bid. The $25-billion buyout took its place as one of the defining business events of the 1980s
Burrough and Helyar, who covered the story for The Wall Street Journal, supply a breezy, colorful, blow-by-blow account of the "deal from hell" (as one businessman characterized a leveraged buyout). The language of Wall Street, full of incongruous "Rambo" jargon from the Vietnam War, is itself arresting. Buyout artists, who presumably never came within 10,000 miles of wartime Saigon, talk about "napalming" corporate perquisites or liken their strategy to "charging through the rice paddies, not stopping for anything and taking no prisoners."
At the time, F. Ross Johnson was widely pilloried in the press as the embodiment of excess; his conflict of interest was obvious. Yet Burrough and Helyar show that Johnson, for all his free-spending ways, was way over his head in the major leagues of greed, otherwise known as Wall Street in the 1980s. What, after all, is more rapacious: the roughly $100 million Johnson stood to gain if his deal worked out over five years, or the $45 million in expenses KKR demanded for waiting 60 minutes while Ross Johnson prepared a final competing bid?
Barbarians is, in the parlance of the publishing world, a good read. At the same time, unfortunately, a disclaimer issued by the authors proves only too true. Anyone looking for a definitive judgment of LBOs will be disappointed. Burrough and Helyar do at least ask the pertinent question: What does all this activity have to do with building and sustaining a business? But authors should not only pose questions; they should answer them, or at least try.
Admittedly, the single most important answer to the RJR puzzle could not be provided by Burrough and Helyar because it is not yet known. The major test of any financial engineering is its effect on the long-term vitality of the leveraged corporation, as measured by such key indicators as market share (and not just whether the corporation survives its debt, as the authors imply). However, a highly-leveraged RJR Nabisco is already selling off numerous profitable parts of its business because they are no longer a "strategic fit": Wall Street code signifying a need for cash in order to service debts and avoid bankruptcy.
If the authors were unable to predict the ultimate outcome, they still had a rare opportunity to explain how and why an LBO is engineered. Unfortunately, their fixation on re-creating events and dialogue – which admittedly produces a fast-moving book – forced them to accept the issues as defined by the participants themselves. There is no other way to explain the book's uncritical stance. When, for example, the RJR Nabisco board of directors tried to decide which bid to accept, Burrough and Helyar report that several directors sided with KKR's offer because the LBO boutique "knew the value of keeping [employees] happy." It is impossible to tell from the book whether the directors knew this to be true or took KKR's word. Even a cursory investigation would have revealed that KKR is notorious for showing no concern for employees below senior management after a leveraged buyout.
The triumph of gossip over substance is manifest in many other ways. Wall Street's deft manipulation of the business press is barely touched upon, and the laissez-faire environment procured by buyout artists via their political contributions is scarcely mentioned, crucial though it is. Nowhere are the authors' priorities more obvious than in the number of words devoted to Henry Kravis's conspicuous consumption compared to those devoted to the details of the RJR deal. In testimony before Congress last year, no less an authority than Treasury Secretary Nicholas Brady – himself an old Wall Street hand – noted that the substitution of tax-deductible debt for taxable income is "the mill in which the grist of takeover premiums is ground."
In the case of RJR Nabisco, 81 percent of the $9.9 billion premium paid to shareholders was derived from tax breaks achievable after the buyout. This singularly important fact cannot be found in the book, however; nor will a reader learn that after the buyout the U.S. Treasury was obligated to refund RJR as much as $1 billion because of its post-buyout debt burden. In Barbarians, more time is spent describing Kravis's ostentatious gifts to his fashion-designer wife than to the tax considerations that make or break these deals.
Fulminations about the socially corrosive effects of greed aside, the buyout phenomenon may represent one of the biggest changes in the way American business is conducted since the rise of the public corporation, nothing less than a transformation of managerial into financial capitalism. The ferocious market for corporate control that emerged during the 1980s has few parallels in business history, but there are two: the trusts that formed early in this century and the conglomerate mania that swept corporate America during the 1960s. Both waves resulted in large social and economic costs, and there is little assurance that the corporate infatuation with debt will not exact a similarly heavy toll.
As the economist Henry Kaufman has written, the high levels of debt associated with buyouts and other forms of corporate restructuring create fragility in business structures and vulnerability to economic cycles. Inexorably, the shift away from equity invites the close, even intrusive involvement of institutional investors (banks, pension funds, and insurance companies) that provide the financing. Superficially, this moves America closer to the system that prevails in Germany and Japan, where historically the relationship between the suppliers and users of capital is close. But Germany and Japan incur higher levels of debt for expansion and investment, whereas equivalent American indebtedness is linked to the recent market for corporate control. That creates a brittle structure, one that threatens to turn the U.S. government into something of an ultimate guarantor if and when things do fall about. It is too easy to construct a scenario in which corporate indebtedness forces the federal government into the business of business. The savings-and-loan bailout is a painfully obvious harbinger of such a development.
The many ramifications of the buyout mania deserve thoughtful treatment. Basic issues of corporate governance and accountability ought to be openly debated and resolved if the American economy is to deliver the maximum benefit to society and not just unconscionable rewards to a handful of bankers, all out of proportion to their social productivity. It is disappointing, but a sign of the times, that the best book about the deal of deals fails to educate as well as it entertains.
Sep 14, 2015 | The Guardian
The waning clout stems from the lobby siding with the revanchist Israeli Prime Minister Binyamin Netanyahu, whose Iran strategy since the 2012 US presidential campaign has been to unabashedly side with Republican hawks. AIPAC's alignment with the position effectively caused the group to marginalize itself; the GOP is now the only place where AIPAC can today find lockstep support. The tens of millions AIPAC spent lobbying against the deal were unable to obscure this dynamic.
We may not look back at this as a sea change – some Senate Democrats who held firm against opposition to the deal are working with AIPAC to pass subsequent legislation that contains poison pills designed to kill it – but rather as a rising tide eroding the once sturdy bipartisan pro-Israeli government consensus on Capitol Hill. Some relationships have been frayed; previously stalwart allies of the Israel's interests, such as Vice President Joe Biden, have reportedly said the Iran deal fight soured them on AIPAC.
Even with the boundaries of its abilities on display, however, AIPAC will continue its efforts. "We urge those who have blocked a vote today to reconsider," the group said in a spin-heavy statement casting a pretty objective defeat as victory with the headline, "Bipartisan Senate Majority Rejects Iran Nuclear Deal." The group's allies in the Senate Republican Party have already promised to rehash the procedural vote next week, and its lobbyists are still rallying for support in the House. But the Senate's refusal to halt US support for the deal means that Senate Democrats are unlikely to reconsider, especially after witnessing Thursday's Republican hijinx in the House. These ploys look like little more than efforts to embarrass Obama into needing to cast a veto.
If Republicans' rhetoric leading up to to their flop in the Senate – Senator Lindsey Graham of South Carolina took to the floor during the debate and pulled out an old trick from the run-up to the Iraq war: blaming Iran for 9/11 and saying a failure to act would result in a worse attack – is any indication, even Democrats like the pro-Israel hawk Chuck Schumer will find it untenable to sidle up to AIPAC and the Republicans.
Opponents of the deal want to say the Democrats played politics instead of evaluating the deal honestly. That charge is ironic, to say the least, since most experts agree the nuclear deal is sound and the best agreement diplomacy could achieve. But there were politics at play: rather than siding with Obama, Congressional Democrats lined up against the Republican/Netanyahu alliance. The adamance of AIPAC ended up working against its stated interests.
Groups like AIPAC will go on touting their bipartisan bona fides without considering that their adoption of Netanyahu's own partisanship doomed them to a partisan result. Meanwhile, the ensuing fight, which will no doubt bring more of the legislative chaos we saw this week, won't be a cakewalk, so to speak, but will put the lie to AIPAC's claims it has a bipartisan consensus behind it. Despite their best efforts, Obama won't be the one embarrassed by the scrambling on the horizon.TiredOldDog 13 Sep 2015 21:47
a foreign country whose still hell bent on committing war crimes
I guess this may mean Israel. If it does, how about we compare Assad's Syria, Iran and Israel. How many war crimes per day in the last 4 years and, maybe, some forecasts. Otherwise it's the usual gratuitous use of bad words at Israel. It has a purpose. To denigrate and dehumanize Israel or, at least, Zionism.
ID7612455 13 Sep 2015 18:04
The problem with the right in the USA is that they offer no alternatives, nothing, nada and zilch they have become the opposition party of opposition. They rely on talking point memes and fear, and it has become the party of extremism and simplicity offering low hanging fruit and red meat this was on perfect display at their anti Iran deal rally, palin, trump, beck and phil robinson who commands ducks apparently.
winemaster2 13 Sep 2015 17:01
Put a Brush Mustache on the control freak, greed creed, Nentanhayu the SOB not only looks like but has the same mentality as Hitler and his Nazism crap.
Martin Hutton -> mantishrimp 12 Sep 2015 23:50
I wondered when someone was going to bring up that "forgotten" fact. Is it any wonder the Iranians don't trust the US. After the US's spying exploits during the Iraqi WMD inspections, why are you surprised that Iran asks for 24 days notice of inspection (enough time to clear out conventional weapons development but not enough to remove evidence of nuclear weapons development).
mantishrimp 12 Sep 2015 20:51
Most Americans don't know the CIA overthrew the Iranian government in 1953 and installed the Shaw. Most Republicans know that most Americans will believe what Fox news tells them. Republicans live in an alternate universe where there is no climate change, mammon is worshiped and wisdom is rejected hatred is accepted negotiation is replaced by perpetual warfare. Now most Americans are tired of stupid leadership and the Republicans are in big trouble.
ByThePeople -> Sieggy 12 Sep 2015 20:27
Is pitiful how for months and months, certain individuals blathered on and on and on when it was fairly clear from the get go that this was a done deal and no one was about cater to the war criminal. I suppose it was good for them, sucking every last dime they could out of the AICPA & Co. while they acted like there was 'a chance'. Nope, only chance is that at the end of the day, a politician is a politician and he'll suck you dry as long as you let 'em.
What a pleasure it is to see the United States Congress finally not pimp themselves out completely to a foreign country whose still hell bent on committing war crimes. A once off I suppose, but it's one small step for Americans.
ByThePeople 12 Sep 2015 20:15
AIPAC - Eventually everything is seen for what is truly is.
ambushinthenight -> Greg Zeglen 12 Sep 2015 18:18
Seems that it makes a lot of sense to most everyone else in the world, it is now at the point where it really makes no difference whether the U.S. ratifies the deal or not. Israel is opposed because they wish to maintain their nuclear weapons monopoly in the region. Politicians here object for one of two reasons. They are Israeli first and foremost not American or for political expediency and a chance to try undo another of this President's achievements. Been a futile effort so far I'd say.
hello1678 -> BrianGriffin 12 Sep 2015 16:42
With the threat you describe from Israel it seems only sensible for Iran to develop nuclear weapons - if my was country (Scotland) was in Iran's place and what you said is true i would only support politicians who promised fast and large scale production of atomic weapons to counter the clear threat to my nation.
nardone -> Bruce Bahmani 12 Sep 2015 14:12
Netanyahu loves to play the victim, but he is the primary cause that Jews worldwide, but especially in the United States, are rethinking the idea of "Israel." I know very few people who willingly identify with a strident right wing government comprised of rabid nationalists, religious fundamentalists, and a violent, almost apocalyptic settler community.
The Israeli electorate has indicated which path it wishes to travel, but that does not obligate Jews throughout the world to support a government whose policies they find odious.
Greg Zeglen -> Glenn Gang 12 Sep 2015 13:51
good point which is found almost nowhere else...it is still necessary to understand that the whole line of diplomacy regarding the west on the part of Iran has been for generations one of deceit...and people are intensely jealous of what they hold dear - especially safety and liberty with in their country....
EarthyByNature -> Bruce Bahmani 12 Sep 2015 13:45
I do trust your on salary with a decent benefits package with the Israeli government or one of it's slavish US lobbyists. Let's face it, got to be hard work pouring out such hateful drivel.
BrianGriffin -> imipak 12 Sep 2015 12:53
The USA took about six years to build a bomb from scratch. The UK took almost six years to build a bomb. Russia was able to build a bomb in only four years (1945-1949). France took four years to build a bomb. https://en.wikipedia.org/wiki/France_and_weapons_of_mass_destruction
The Chinese only took four years. http://www.china.org.cn/english/congress/228244.htm
steelhead 12 Sep 2015 12:48
As part of this deal the US and allies should guarantee Iran protection against Israeli aggression. Otherwise, considering Israel's threats, Iran is well justified in seeking a nuclear deterrent.
BrianGriffin -> HauptmannGurski 12 Sep 2015 12:35
"Europe needs business desperately."
Sieggy 12 Sep 2015 12:32
In other words, once again, Obama out-played and out-thought both the GOP and AIPAC. He was playing multidimensional chess while they were playing checkers. The democrats kept their party discipline while the republicans ran around like a schoolyard full of sugared-up children. This is what happens when you have grownups competing with adolescents. The republican party, to put it very bluntly, can't get it together long enough to whistle 'Yankee Doodle Dandy' in unison.
They lost. Again. And worse than being losers, they're sore, whining, sniveling, blubbering losers. Even when they've been spanked - hard - they swear it's not over and they're gonna get even, just you wait and see! Get over it. They lost - badly - and the simple fact that their party is coming apart at the seams before our very eyes means they're going to be losing a lot more, too.
AIPAC's defeat shows that their grip on the testicles of congress has been broken. All the way around, a glorious victory for Obama, and an ignominious defeat for the republicans. And most especially, Israel. Their primary goal was to keep Iran isolated and economically weak. They knew full well that the Iranians hadn't had a nuclear program since 2003, but Netanhayu needed an existential threat to Israel in order to justify his grip on power. All of this charade has bee at the instigation of and directed by Israel. And they lost They were beaten by that hated schwartze and the liberals that Israel normally counts on for unthinking support.
Their worst loss, however, was losing the support of the American jews. Older, orthodox jews are Israel-firsters. The younger, less observant jews are Americans first. Netanhayu's behavior has driven a wedge between the US and Israel that is only going to deepen over time. And on top of that, Iran is re-entering the community of nations, and soon their economy will dominate the region. Bibi overplayed his hand very, very stupidly, and the real price that Israel will pay for his bungling will unfold over the next few decades.
BrianGriffin -> TiredOldDog 12 Sep 2015 12:18
"The Constitution provides that the president 'shall have Power, by and with the Advice and Consent of the Senate, to make Treaties, provided two-thirds of the Senators present concur'"
Hardly a done deal. If Obama releases funds to Iran he probably would be committing an impeachable crime under US law. Even many Democrats would vote to impeach Obama for providing billions to a sworn enemy of Israel.
Glenn Gang -> Bruce Bahmani 12 Sep 2015 12:07
"...institutionally Iranclad(sic) HATRED towards the west..." Since you like all-caps so much, try this: "B.S."
The American propel(sic) actually figured out something else---that hardline haters like yourself are desperate to keep the cycle of Islamophobic mistrust and suspicion alive, and blind themselves to the fact that the rest of us have left you behind.
FACT: More than half of the population of Iran today was NOT EVEN BORN when radical students captured the U.S. Embassy in Teheran in 1979.
People like you, Bruce, conveniently ignore the fact that Ahmedinejad and his hardline followers were voted out of power in 2013, and that Supreme Leader Ali Khamenei further marginalized them by allowing the election of new President Hassan Rouhani to stand, though he was and is an outspoken reformer advocating rapprochement with the west. While his outward rhetoric still has stern warnings about anticipated treachery by the 'Great Satan', Khamenei has allowed the Vienna agreement to go forward, and shows no sign of interfering with its implementation.
He is an old man, but he is neither stupid nor senile, and has clearly seen the crippling effects the international sanctions have had on his country and his people. Haters like you, Bruce, will insist that he ALWAYS has evil motives, just as Iranian hardliners (like Ahmedinejad) will ALWAYS believe that the U.S. has sinister motives and cannot EVER be trusted to uphold our end of any agreement. You ascribe HATRED in all caps to Iran, the whole country, while not acknowledging your own simmering hatred.
People like you will always find a 'boogeyman,' someone else to blame for your problems, real or imagined. You should get some help.
beenheretoolong 12 Sep 2015 10:57
No doubt Netanyahu will raise the level of his anger; he just can't accept that a United States president would do anything on which Israel hadn't stamped its imprimatur. It gets tiresome listening to him.
geneob 12 Sep 2015 10:12
It is this deal that feeds the military industrial complex. We've already heard Kerry give Israel and Saudi Arabia assurances of more weapons. And that $150 billion released to Iran? A healthy portion will be spent for arms..American, Russian, Chinese. Most of the commenters have this completely backwards. This deal means a bonanza for the arms industry.
Jack Hughes 12 Sep 2015 08:38
The Iran nuclear agreement accomplishes the US policy goal of preventing the creation of the fissionable material required for an Iranian nuclear weapons program.
What the agreement does not do is eliminate Iran as a regional military and economic power, as the Israelis and Saudis -- who have invested hundreds of millions of dollars to lobby American politicians and brainwash American TV viewers -- would prefer.
To reject the agreement is to accept the status quo, which is unacceptable, leaving an immediate and unprovoked American-led bombing campaign as the only other option.
Rejection equals war. It's not surprising that the same crowd most stridently demanding rejection of the agreement advocated the disastrous invasion and occupation of Iraq. These homicidal fools never learn, or don't care as long as it's not their lives at risk.
American politicians opposed to the agreement are serving their short-term partisan political interests and, under America's system of legalized bribery, their Israeli and Saudi paymasters -- not America's long-term policy interests.
ID293404 -> Jeremiah2000 12 Sep 2015 05:01
And how did the Republicans' foreign policy work out? Reagan created and financed Al Qaeda. Then Bush II invades Iraq with promises the Iraqis will welcome us with flowers (!), the war will be over in a few weeks and pay for itself, and the middle east will have a nascent democracy (Iraq) that will be a grateful US ally.
He then has pictures taken of himself in a jet pilot's uniform on a US aircraft carrier with a huge sign saying Mission Accomplished. He attacks Afghanistan to capture Osama, lets him get away, and then attacks Iraq instead, which had nothing to do with 9/11 and no ties with Al Qaeda.
So then we have two interminable wars going on, thanks to brilliant Republican foreign policy, and spend gazillions of dollars while creating a mess that may never be straightened out. Never mind all the friends we won in the middle east and the enhanced reputation of our country through torture, the use of mercenaries, and the deaths and displacement of hundreds of thousands of civilians. Yeah, we really need those bright Republicans running the show over in the Middle East!
HauptmannGurski -> lazman 12 Sep 2015 02:31
That is a very difficult point to understand, just look at this sentence "not understanding the fact in international affairs that to disrespect an American president is to disrespect Americans" ... too much emperor thinking for me. We have this conversation with regard to Putin everywhere now, so we disrespect all 143 million Russians? There's not a lot of disrespect around for Japanese PM Abe and Chinese Xi - does this now mean we respect them and all Japanese and Chinese? Election campaigns create such enormous personality cults that people seem to lose perspective.
On the Iran deal, if the US had dropped out of it it would have caused quite a rift because many countries would have just done what they wanted anyway. The international Atomic Energy Organisation or what it is would have done their inspections. Siemens would have sold medical machines. Countries would grow up as it were. But as cooperation is always better than confrontation it is nice the US have stayed in the agreement that was apparently 10 years in the making. It couldn't have gone on like that. With Europe needing gazillions to finance Greece, Ukraine, and millions of refugees (the next waves will roll on with the next spring and summer from April), Europe needs business desparately. Israel was happy to buy oil through Marc Rich under sanctions, now it's Europe's turn to snatch some business.
imipak -> BrianGriffin 11 Sep 2015 21:56
Iran lacks weapons-grade uranium and the means to produce it. Iran has made no efforts towards nuclear weapons technology for over a decade. Iran is a signatory of the NPT and is entitled to the rights enshrined therein. If Israel launches a nuclear war against Iran over Iran having a medical reactor (needed to produce isotopes for medicine, isotopes America can barely produce enough of for itself) that poses no security threat to anyone, then Israel will have transgressed so many international laws that if it survives the radioactive fallout (unlikely), it won't survive the political fallout.
It is a crime of the highest order to use weapons of mass destruction (although that didn't stop the Israelis using them against Palestinian civilians) and pre-emtive self-defence is why most believe Bush and Blair should be on trial at the ICJ, or (given the severity of their crimes) Nuremberg.
Israel's right to self-defense is questionable, I'm not sure any such right exists for anyone, but even allowing for it, Israel has no right to wage unprovoked war on another nation on the grounds of a potential threat discovered through divination using tea leaves.
imipak -> Jeremiah2000 11 Sep 2015 21:43
Iran's sponsorship of terrorism is of no concern. Such acts do not determine its competency to handle nuclear material at the 5% level (which you can find naturally). There are only three questions that matter - can Iran produce the 90-95% purity needed to build a bomb (no), can Iran produce such purity clandestinely (no), and can Iran use its nuclear technology to threaten Israel (no).
Israel also supports international terrorism, has used chemical weapons against civilians, has directly indulged in terrorism, actually has nuclear weapons and is paranoid enough that it may use them against other nations without cause.
I respect Israel's right to exist and the intelligence of most Israelis. But I neither respect nor tolerate unreasoned fear nor delusions of Godhood.
imipak -> commish 11 Sep 2015 21:33
I've seen Iranian statements playing internal politics, but I have never seen any actual Iranian threats. I've seen plenty about Israel assassinating people in other countries, using incendiaries and chemical weapons against civilians in other countries, conducting illegal kidnappings overseas, using terrorism as a weapon of war, developing nuclear weapons illegally, ethnically cleansing illegally occupied territories, that sort of thing.
Until such time as Israel implements the Oslo Accords, withdraws to its internationally recognized boundary and provides the International Court of Justice a full accounting of state-enacted and state-sponsored terrorism, it gets no claims on sainthood and gets no free rides.
Iran has its own crimes to answer, but directly threatening Israel in words or deeds has not been one of them within this past decade. Its actual crimes are substantial and cannot be ignored, but it is guilty only of those and not fictional works claimed by psychotic paranoid ultra-nationalists.
imipak -> moishe 11 Sep 2015 21:18
Domestic politics. Of no real consequence, it's just a way of controlling a populace through fear and a never-ending pseudo-war. It's how Iran actually feels that is important.
For the last decade, they've backed off any nuclear weapons research and you can't make a bomb with centrifuges that can only manage 20% enriched uranium. You need something like 90% enrichment, which requires centrifuges many, many times more advanced. It'd be hard to smuggle something like that in and the Iranians lack the skills, technology and science to make them.
Iran's conventional forces are busy fighting ISIS. What they do afterwards is a concern, but Israel has a sizable military presence on the Golan Heights. The most likely outcome is for Iran to install puppet regimes (or directly control) Syria and ISIS' caliphate.
I could see those two regions plus Iraq being fully absorbed into Iran, that would make some sense given the new geopolitical situation. But that would tie up Iran for decades. Which would not be a bad thing and America would be better off encouraging it rather than sabre-rattling.
(These are areas that contribute a lot to global warming and political instability elsewhere. Merging the lot and encouraging nuclear energy will do a lot for the planet. The inherent instability of large empires will reduce mischief-making elsewhere to more acceptable levels - they'll be too busy. It's idle hands that you need to be scared of.)
Israelis worry too much. If they spent less time fretting and more time developing, they'd be impervious to any natural or unnatural threat by now. Their teaching of Roman history needs work, but basically Israel has a combined intellect vastly superior to that of any nearby nation.
That matters. If you throw away fear and focus only on problems, you can stop and even defeat armies and empires vastly greater than your own. History is replete with examples, so is the mythologicized history of the Israeli people. Israel's fear is Israel's only threat.
mostfree 11 Sep 2015 21:10
Warmongers on all sides would had loved another round of fear and hysteria. Those dark military industrial complexes on all sides are dissipating in the face of the high rising light of peace for now . Please let it shine.
bishoppeter4 11 Sep 2015 20:09
The rabid Republicans working for a foreign power against the interest of the United States -- US citizens will know just what to do.
Jeremiah2000 -> Carolyn Walas Libbey 11 Sep 2015 19:21
"Netanyahu has no right to dictate what the US does."
But he has every right to point out how Obama is a weak fool. How's Obama's red line working in Syria? How is his toppling of Qadaffi in Libya working? How about his completely inept dealings with Egypt, throwing support behind the Muslim Brotherhood leaders? The leftists cheer Obama's weakening of American influence abroad. But they don't talk much about its replacement with Russian and Chinese influence. Russian build-up in Syria part of secret deal with Iran's Quds Force leader. Obama and Kerry are sending a strongly worded message.
Susan Dechancey -> whateverworks4u 11 Sep 2015 19:05
Incredible to see someone prefer war to diplomacy - guess you are an armchair General not a real one.
Susan Dechancey -> commish 11 Sep 2015 19:04
Except all its neighbours ... not only threatened but entered military conflict and stole land ... murdered Iranian Scientists but apart from that just a kitten
Susan Dechancey -> moishe 11 Sep 2015 19:00
Israel has nukes so why are they afraid ?? Iran will never use nukes against Israel and even Mossad told nuttyyahoo sabre rattling
Susan Dechancey 11 Sep 2015 18:57
Iran is not a made-up country like Iraq it is as old as Greece. If the Iraq war was sold as pushover and failed miserably then an Iran war would be unthinkable. War can be started in an instant diplomacy take time. UK, France, Germany & EU all agree its an acceptable alternative to war. So as these countries hardly ever agree it is clear the deal is a good one.
To be honest the USA can do what it likes now .. UK has set up an embassy - trade missions are landing Tehran from Europe. So if Israel and US congress want war - they will be alone and maybe if US keeps up the Nuttyahoo rhetoric European firms can win contracts to help us pay for the last US regime change Iraq / Isis / Refugees...
lswingly -> commish 11 Sep 2015 16:58
Rank and file Americans don't even know what the Iran deal is. And can't be bothered to actually find out. They just listen to sound bites from politicians the loudest of whom have been the wildly partisan republicans claiming that it gives Iran a green light to a nuclear weapon. Not to mention those "less safe" polls are completely loaded. Certain buzz words will always produce negative results. If you associate something positive "feeling safe" or "in favor of" anything that Iran signs off on it comes across as indirectly supporting Iran and skews the results of the poll. "Iran" has been so strongly associated with evil and negative all you have to do is insert it into a sentence to make people feel negatively about the entire sentence. In order to get true data on the deal you would have to poll people on the individual clauses the deal.
It's no different from how when you run a poll on who's in favor "Obamacare" the results will be majority negative. But if you poll on whether you are in favor of "The Affordable Care Act" most people are in favor of it and if you break it down and poll on the individual planks of "Obamacare" people overwhelming approve of the things that "Obamacare does". The disapproval is based on the fact that Republican's have successfully turned "Obamacare" into a pejorative and has almost no reflection of people feelings on actual policy.
To illustrate how meaningless those poll numbers are a Jewish poll (supposedly the people who have the most to lose if this deal is bad) found that a narrow majority of Jews approve of the deal. You're numbers are essentially meaningless.
The alternative to this plan is essentially war if not now, in the very near future, according to almost all non-partisan policy wonks. Go run a poll on whether we should go to war with Iran and see how that turns out. Last time we destabilized the region we removed a secular dictator who was enemies with Al Queda and created a power vacuum that led to increased religious extremism and the rise of Isis. You want to double down on that strategy?
MadManMark -> whateverworks4u 11 Sep 2015 16:34
You need to reread this article. It's exactly this attitude of yours (and AIPAC and Netanyahu) that this deal is not 100% perfect, but then subsequently failed to suggest ANY way to get something better -- other than war, which I'm sorry most people don't want another Republican "preemptive" war -- caused a lot people originally uncertain about this deal (like me) to conclude there may not be a better alternative. Again, read the article: What you think about me, I now think about deal critics like you ("It seems people will endorse anything to justify their political views.)
USfan 11 Sep 2015 15:34
American Jews are facing one of the most interesting choices of recent US history. The Republican Party, which is pissing into a stiff wind of unfavorable demographics, seems to have decided it can even the playing field by peeling Jews away from the Democrats with promises to do whatever Israel wants. So we have the very strange (but quite real) prospect of Jews increasingly throwing in their lot with the party of Christian extremists whose ranks also include violent antiSemites.
Interesting times. We'll see how this plays out. My family is Jewish and I have not been shy in telling them that alliances with the GOP for short-term gains for Israel is not a wise policy. The GOP establishment are not antiSemtic but the base often is, and if Trump's candidacy shows anything it's that the base is in control of the Republicans.
But we'll see.
niyiakinlabu 11 Sep 2015 15:29
Central question: how come nobody talks about Israel's nukes?
hello1678 -> BrianGriffin 11 Sep 2015 14:02
Iran will not accept being forced into dependence on outside powers. We may dislike their government but they have as much right as anyone else to enrich their own fuel.
JackHep 11 Sep 2015 13:30
Netanyahu is an example of all that is bad about the Israeli political, hence military industrial, establishment. Why Cameron's government allowed him on British soil is beyond belief. Surely the PM's treatment of other "hate preachers" would not have been lost on Netanyahu? Sadly our PM seems to miss the point with Israel.
talenttruth 11 Sep 2015 13:12
The American Warmonger Establishment (that now fully entrenched "Military Industrial Complex" against which no more keen observer than President Dwight Eisenhower warned us), is rip-shit over the Iran Agreement. WHAT? We can't Do More War? That will be terrible for further increasing our obscene 1-percent wealth. Let's side with Israeli wingnut Netanyahu, who cynically leverages "an eye for an eye for an eye for an eye" to hold his "Power."
And let's be treasonous against the United States by trying to undermine U.S. Foreign Policy FOR OUR OWN PROFIT. We are LONG overdue for serious jail time for these sociopaths, who already have our country "brainwashed" into 53% of our budget going to the War Profiteers and to pretending to be a 19th century Neo-Colonial Power -- in an Endless State of Eternal War. These people are INSANE. Time to simply say so.
Boredwiththeusa 11 Sep 2015 12:58
At the rally to end the Iran deal in the Capitol on Wednesday, one of the AIPAC worshipping attendees had this to say to Jim Newell of Slate:
""Obama is a black, Jew-hating, jihadist putting America and Israel and the rest of the planet in grave danger," said Bob Kunst of Miami. Kunst-pairing a Hillary Clinton rubber mask with a blue T-shirt reading "INFIDEL"-was holding one sign that accused Obama, Hillary Clinton, and John Kerry of "Fulfilling Hitler's Dreams" and another that queried, "DIDN'T WE LEARN ANYTHING FROM 1938?"
His only reassurance was that, when Iran launches its attack on the mainland, it'll be stopped quickly by America's heavily armed citizenry."
That is indicative of the mindset of those opposed to the agreement.
Boredwiththeusa 11 Sep 2015 12:47
AIPAC is a dangerous anti-american organization, and a real and extant threat to the sovereignty of the U.S. Any elected official acting in concert with AIPAC is colluding with a foreign government to harm the U.S. and should be considered treasonous and an enemy of the American people.
tunejunky 11 Sep 2015 12:47
AIPAC, its constituent republicans, and the government of Israel all made the same mistake in a common episode of hubris. by not understanding the American public, war, and without the deference shown from a proxy to its hegemon, Israel's right wing has flown the Israeli cause into a wall. not understanding the fact in international affairs that to disrespect an American president is to disrespect Americans, the Israeli government acted as a spoiled first-born - while to American eyes it was a greedy, ungrateful ward foisted upon barely willing hands. it presumed far too much and is receiving the much deserved rebuke.
impartial12 11 Sep 2015 12:37
This deal is the best thing that happened in the region in a while. We tried war and death. It didn't work out. Why not try this?
Feb 01, 2016 | chroniclesmagazine.orgView all posts from this blog
On January 23 Freedom and Prosperity Radio , Virginia's only syndicated political talk radio show, broadcast an interview with Srdja Trifkovic on the subject of Islam and the ongoing Muslim invasion of Europe. Here is the full transcript of the interview. ( Audio )
FPR: Your book The Sword of the Prophet was published back in 2002, yet here we are-15 years later-still scratching our heads over this problem. Defeating Jihad you wrote ten years ago, and yet we are still fumbling around in the dark. It seems like we don't have the ability to say what is right and what is wrong. We've lost the ability we had had during the Cold War to say out way is better than their way . . .
ST: I'm afraid the problem is deeper than that. It is in the unwillingness of the ruling elite in the Western world to come to grips with the nature of Islam-as-such. There is this constant tendency by the politicians, the media and the academia to treat jihadism as some sort of aberration which is alien to "true" Islam. We had an example of that in 2014, when President Obama went so far as to say that ISIS was "un-Islamic"! It is rather curious that the President of the United States assumes the authority of a theologian who can pass definite judgments on whether a certain phenomenon is "Islamic" or not. Likewise we have this constant repetition of the mantra of the "religion of peace and tolerance," which is simply not supported by 14 centuries of historical experience. What I've tried to emphasize in both those books you've mentioned, and in my various other writings and public appearances, is that the problem of Islam resides in the core texts, in the Kuran and the Hadith , the "Traditions" of the prophet of Islam, Muhammed. This is the source from which the historical practice has been derived ever since. The problem is not in the jihadists misinterpreting Islam, but rather in interpreting it all too well. This mythical "moderate Islam," for which everybody seems to be looking these days, is an exception and not the rule.
In answer to your question, I'd say that "scratching one's head" is-by now-only the phenomenon of those who refuse to face reality. Reasonable people who are capable of judging phenomena on their merits and on the basis of ample empirical evidence, are no longer in doubt. They see that the problem is not in the alleged misinterpretation of the Islamic teaching, but rather in its rigorous application and literal understanding. I'm afraid things will not get better, because with each and every new jihadist attack, such as the Charlie Hebdo slaughter in Paris a year ago, or again in Paris last November, or the New Year's Eve violence in Germany, we are witnessing-time and over again-the same problem. The Islamic mindset, the Islamic understanding of the world, the Muslim Weltanschauung , world outlook, is fundamentally incompatible with the Western value system and the Western way of life.
FPR: . . . It seems obvious, regarding Islam, that its "freedom of religion" is impacting other people, and it's dictated to do so-it must go out and fight the infidels. And that's where we have the disconnect. Maybe there is some traction to the statement, as you put it, that fundamentalism reflects a far more thorough following of Islam, and that it is simply incompatible with the Constitution?
ST: It is inevitable, because if you are an orthodox, practicing, mainstream Muslim, then you necessarily believe in the need to impose Sharia as the law of the land. Sharia is much more than a legal code. It is also a political program, it is a code of social behavior, it is the blueprint for the totality of human experience. That's why it is impossible to make Sharia compatible with the liberal principle of "live and let live": it is inherently aggressive to non-Islam. In the Islamic paradigm, the world is divided in the Manichean manner, black-and-white, into "the World of Faith," Dar al-Islam , literally "the world of submission," and "the World of War, Dar al-Harb .
It is the divine duty of each and every Muslim to seek the expansion of Dar al-Islam at the expense of Dar al-Harb until the one true faith is triumphant throughout the world. In this sense the Islamic mindset is very similar to Bolshevism. The Bolsheviks also believed that "the first country of Socialism" should expand its reach and control until the whole world has undergone the proletarian revolution and has become one in the march to the Utopia of communism. There is constant inner tension in the Islamic world, in the sense that for as long as non-Islam exists, it is inherently perceived as "the other," as an abomination. In that sense, Muslims perceive any concession made by the West-for instance in allowing mass immigration into Western Europe-not as a gesture of good will and multicultural tolerance, but as a sign of weakness that needs to be exploited and used as a means to an end.
FPR: The Roman Catholic Church has its Catechism which decides the issues of doctrine. Until there's an Islamic "catechism" which can say "no, this is no longer the right interpretation, this is not what it means any more"-and I don't think this would be a short-term thing, because you'd still have the splinter groups dissenting against the "traitors"-but is this the only way to go to the center of theological jurisprudence in the Islamic world?
ST: The problem is twofold. First of all, there is no "interpretation" of the Kuran . Classical Islamic sources are adamant that the Kuran needs to be taken at face value, literally. If it says in Sura 9, verse 5, "fight the infidels wherever you find them, and let them go if they convert," or if it says time and over again that the choice for a non-Muslim is to accept Islam, or to live as a second-class citizen-the dhimmi -under Islamic supremacy, or else to be killed it is very hard to imagine what sort of authority in the Islamic world would be capable of saying "now we are going to relativize and soften the message."
The second part of the problem is that there is no single authority in Islam. It is not organized in a hierarchical way like the Roman Catholic Church, where if the Pope speaks ex cathedra his pronouncements are obligatory for all Catholics everywhere. Islam is a diffused religion, with various centers of learning and various ullema who may or may not agree on certain peripheral details. Yet any any one of them who'd dare say "look, now we rally need to reinterpret the fundamental sources, the Kuran and the Hadith, so as to make it compatible with the pluralist society"-they'd immediately be condemned as heretics. We've seen attempts at reform in the past. In the end the orthodox interpretation always prevails, because it is-sadly-the right interpretation of the core texts. With neither the hierarchy capable of imposing a new form of teaching on the faithful, nor the existence of alternative core texts which would provide grounds for such reinterpretation, it is very hard to see how it could be done.
FPR: How do we go forward? . . . How does the end-game play out?
ST: I'd say that in modern times the main culprit was Zbigniew Brzezynski, who freely admitted in an interview with the French weekly magazine Le Nouvel Observateur in 1998 that he had this, as he called it, "brilliant idea" to let the Islamist genie out of the bottle to fight the Soviets in Afghanistan following the Soviet occupation in 1979. At that time he was President Carter's National Security Advisor. The transmission belt, from the CIA and various other U.S. agencies to the jihadists in Afghanistan, went via Pakistan. The ISI, the all-powerful military Inter-Service Intelligence-an institution which is pro-jihadist to boot-was used by the U.S. to arm elements which later morphed into al-Qaeda. The breeding ground for the modern, one might say postmodern form of jihadism, was Afghanistan-and it was made possible by U.S. policy inputs which helped its development.
But if we look at the past 14 centuries, time and over again we see the same phenomenon. The first time they tried to conquer Europe was across the Straits of Gibraltar and across the Iberian Peninsula, today's Spain. Then they crossed the Pyrinees and were only stopped at Poitiers by Charles Martel in 732AD. Then they were gradually being pushed back, and the Reconquista -- the reconquest of Spain-lasted 800 years, until 1492, when Cordoba finally fell to the Christian forces. Then came the second, Ottoman onslaught, in the XIVth century, which went across the Dardanelles into the Balkan Peninsula. The Turks were only finally stopped at the gates of Vienna in 1683. Pushing Turkey out of Europe went all the way to 1912, to the First Balkan War.
So we may say that we are now witnessing the third Islamic conquest of Europe. This time it is not using armed janissaries, it is using so-called refugees. In fact most of them are healthy young men, and the whole process is obviously a strategic exercise -- a joint venture between Ankara and Riyadh, who are logistically and financially helping this mass transfer of people from the Turkish and Middle Eastern refugee camps to the heart of Europe. The effect may be the same, but this time it is far more dangerous because, on the European side-unlike in 732, or 1683-there is no political will and there is no moral strength to resist. This is happening because the migrants, the invaders, see Europe as the candy store with a busted lock and they are taking advantage of that fact.
FPR: When you see the horrors of rapes and sexual assaults that took place across Germany, and now we see the Germans' response . . . vigilantes on their streets . . . this is something that we either control politically and with leadership, or else it falls apart into anarchy, Prof. Trifkovic?
ST: Instead of anarchy I think we will have a form of postmodern totalitarianism. The elite class, the government of Germany etc, and the media, will demonize those who try to resist. In fact we already have the spectacle of the minister of the interior of one of the German states saying that "hate speech" on the social networks and websites was far worse than the "incidents" in Cologne. And the Mayor of Cologne-an ultra-feminist who is also a pro-immigration enthusiast-said that in order to prevent such events in the future women should observe a "code of conduct" and keep distance "at an arm's length" from men. It's a classic example of blaming the victim. The victims of Islamic violence should change their behavior in order to adapt themselves to the code of conduct and values of the invaders. This is truly unprecedented.
Instead of utter anarchy, I think we are more likely to see the ever more stringent control of the social media. The German government has already imposed on Google and Twitter which is based on the German draconian "hate speech" legislation, rather than on the universally accepted standards. On the whole we see everywhere in Europe that when you have a political party or a person trying to call a spade by its name, to call for a moratorium on immigration or for a fundamental change in the way of thinking, they will be demonized. The same applies to Marine Le Pen in France and to her party, the Front National , or to Geert Wilders in Holland, or to Strache in Austria. Whoever tries to articulate a coherent plan of action that includes a ban or limits on Islamic immigration is immediately demonized as a right-wing fanatic or a fascist. Instead of facing the reality of the situation, that you have a multi-million Islamic diaspora in Europe which is not assimilating, which refuses even to accept a code of conduct of the host population, the reaction is always the same: blame the victim, and demonize those who try to articulate some form of resistance.
FPR: Dr. Trifkovic, how does a country such as ours, the United States, fix this problem . . .
ST: The answer is fairly simple, but it would require a fundamental transformation of the mindset of the political decision-makers. It is to start treating Islamic activism not as "religious" but as an eminently political activity -- subversive political activity, in the same way as communist subversion was treated during the Cold War. In both cases we have a committed, highly motivated group of people who want to effect a fundamental transformation of the United States in a way that is contrary to the U.S. Constitution, to the American way of life, and to the American values. It is time to stop the Islamists from hiding behind the "freedom of religion" mantra. What they are seeking is not some "freedom of religion" but the freedom to organize in order to pursue political subversion. They do not accept the U.S. Constitution.
To start with, every single potential U.S. citizen from the Islamic world needs to be interviewed in great detail about his or her beliefs and commitments. It is simply impossible for a believing Muslim to swear the oath of allegiance to the United States. None of them, if they are true believers, can regard the U.S. Constitution as superior to the Sharia-which is the law of God, while the U.S. Constitution is a man-made document. I happen to know the oath because I am myself a naturalized U.S. citizen. They can do it "in good faith" from their point of view by practicing taqqiya . This is the Arab word for the art of dissimulation, when the Muslim lies to the infidel in order to protect the faith. For them to lie to investigators or to immigration officials about their beliefs and their objectives does not create any conflict of conscience. The prophet of Islam himself has mandated the use of taqqiya if it serves the objective of spreading the faith.
FPR: Can a civil war come out of this? Is it conceivable?
ST: If there is to be a civil war in Europe, it would be pursued between the elite class which wants to continue pursuing multiculturalism and unlimited immigration --for example Germany, where over a million migrants from the Middle East, North Africa etc. were admitted in 2015 alone-and the majority of the population who have not been consulted, and who feel that their home country is being irretrievably lost. I do not believe that there will be many people fighting on the side of the multiculturalists' suicide, but nevertheless we still have very effective forces of coercion and control on the government side which can be deployed to prevent the articulation of any long-term, coherent plan of resistance.
FPR: Where can people continue to read you writings, Dr. Trifkovic?
ST: On Chroniclesmagazine.org where I publish weekly online commentaries, and also in the print edition of Chronicles where I have my regular column.
Nov 30, 2017 | www.unz.com
Money Imperialism Introduction to the German Edition Michael Hudson November 29, 2017 3,500 Words 1 Comment Reply
In theory, the global financial system is supposed to help every country gain. Mainstream teaching of international finance, trade and "foreign aid" (defined simply as any government credit) depicts an almost utopian system uplifting all countries, not stripping their assets and imposing austerity. The reality since World War I is that the United States has taken the lead in shaping the international financial system to promote gains for its own bankers, farm exporters, its oil and gas sector, and buyers of foreign resources – and most of all, to collect on debts owed to it.
Each time this global system has broken down over the past century, the major destabilizing force has been American over-reach and the drive by its bankers and bondholders for short-term gains. The dollar-centered financial system is leaving more industrial as well as Third World countries debt-strapped. Its three institutional pillars – the International Monetary Fund (IMF), World Bank and World Trade Organization – have imposed monetary, fiscal and financial dependency, most recently by the post-Soviet Baltics, Greece and the rest of southern Europe. The resulting strains are now reaching the point where they are breaking apart the arrangements put in place after World War II.
The most destructive fiction of international finance is that all debts can be paid, and indeed should be paid, even when this tears economies apart by forcing them into austerity – to save bondholders, not labor and industry. Yet European countries, and especially Germany, have shied from pressing for a more balanced global economy that would foster growth for all countries and avoid the current economic slowdown and debt deflation.
Imposing austerity on Germany after World War I
After World War I the U.S. Government deviated from what had been traditional European policy – forgiving military support costs among the victors. U.S. officials demanded payment for the arms shipped to its Allies in the years before America entered the Great War in 1917. The Allies turned to Germany for reparations to pay these debts. Headed by John Maynard Keynes, British diplomats sought to clean their hands of responsibility for the consequences by promising that all the money they received from Germany would simply be forwarded to the U.S. Treasury.
The sums were so unpayably high that Germany was driven into austerity and collapse. The nation suffered hyperinflation as the Reichsbank printed marks to throw onto the foreign exchange also were pushed into financial collapse. The debt deflation was much like that of Third World debtors a generation ago, and today's southern European PIIGS (Portugal, Ireland, Italy, Greece and Spain).
In a pretense that the reparations and Inter-Ally debt tangle could be made solvent, a triangular flow of payments was facilitated by a convoluted U.S. easy-money policy. American investors sought high returns by buying German local bonds; German municipalities turned over the dollars they received to the Reichsbank for domestic currency; and the Reichsbank used this foreign exchange to pay reparations to Britain and other Allies, enabling these countries to pay the United States what it demanded.
But solutions based on attempts to keep debts of such magnitude in place by lending debtors the money to pay can only be temporary. The U.S. Federal Reserve sustained this triangular flow by holding down U.S. interest rates. This made it attractive for American investors to buy German municipal bonds and other high-yielding debts. It also deterred Wall Street from drawing funds away from Britain, which would have driven its economy deeper into austerity after the General Strike of 1926. But domestically, low U.S. interest rates and easy credit spurred a real estate bubble, followed by a stock market bubble that burst in 1929. The triangular flow of payments broke down in 1931, leaving a legacy of debt deflation burdening the U.S. and European economies. The Great Depression lasted until outbreak of World War II in 1939.
Planning for the postwar period took shape as the war neared its end. U.S. diplomats had learned an important lesson. This time there would be no arms debts or reparations. The global financial system would be stabilized – on the basis of gold, and on creditor-oriented rules. By the end of the 1940s the United States held some 75 percent of the world's monetary gold stock. That established the U.S. dollar as the world's reserve currency, freely convertible into gold at the 1933 parity of $35 an ounce.
It also implied that once again, as in the 1920s, European balance-of-payments deficits would have to be financed mainly by the United States. Recycling of official government credit was to be filtered via the IMF and World Bank, in which U.S. diplomats alone had veto power to reject policies they found not to be in their national interest. International financial "stability" thus became a global control mechanism – to maintain creditor-oriented rules centered in the United States.
To obtain gold or dollars as backing for their own domestic monetary systems, other countries had to follow the trade and investment rules laid down by the United States. These rules called for relinquishing control over capital movements or restrictions on foreign takeovers of natural resources and the public domain as well as local industry and banking systems.
By 1950 the dollar-based global economic system had become increasingly untenable. Gold continued flowing to the United States, strengthening the dollar – until the Korean War reversed matters. From 1951 through 1971 the United States ran a deepening balance-of-payments deficit, which stemmed entirely from overseas military spending. (Private-sector trade and investment was steadily in balance.)
U.S. Treasury debt replaces the gold exchange standard
The foreign military spending that helped return American gold to Europe became a flood as the Vietnam War spread across Asia after 1962. The Treasury kept the dollar's exchange rate stable by selling gold via the London Gold Pool at $35 an ounce. Finally, in August 1971, President Nixon stopped the drain by closing the Gold Pool and halting gold convertibility of the dollar.
There was no plan for what would happen next. Most observers viewed cutting the dollar's link to gold as a defeat for the United States. It certainly ended the postwar financial order as designed in 1944. But what happened next was just the reverse of a defeat. No longer able to buy gold after 1971 (without inciting strong U.S. disapproval), central banks found only one asset in which to hold their balance-of-payments surpluses: U.S. Treasury debt. These securities no longer were "as good as gold." The United States issued them at will to finance soaring domestic budget deficits.
By shifting from gold to the dollars thrown off by the U.S. balance-of-payments deficit, the foundation of global monetary reserves came to be dominated by the U.S. military spending that continued to flood foreign central banks with surplus dollars. America's balance-of-payments deficit thus supplied the dollars that financed its domestic budget deficits and bank credit creation – via foreign central banks recycling U.S. foreign spending back to the U.S. Treasury.
In effect, foreign countries have been taxed without representation over how their loans to the U.S. Government are employed. European central banks were not yet prepared to create their own sovereign wealth funds to invest their dollar inflows in foreign stocks or direct ownership of businesses. They simply used their trade and payments surpluses to finance the U.S. budget deficit. This enabled the Treasury to cut domestic tax rates, above all on the highest income brackets.
U.S. monetary imperialism confronted European and Asian central banks with a dilemma that remains today: If they do not turn around and buy dollar assets, their currencies will rise against the dollar. Buying U.S. Treasury securities is the only practical way to stabilize their exchange rates – and in so doing, to prevent their exports from rising in dollar terms and being priced out of dollar-area markets.
The system may have developed without foresight, but quickly became deliberate. My book Super Imperialism sold best in the Washington DC area, and I was given a large contract through the Hudson Institute to explain to the Defense Department exactly how this extractive financial system worked. I was brought to the White House to explain it, and U.S. geostrategists used my book as a how-to-do-it manual (not my original intention).
Attention soon focused on the oil-exporting countries. After the U.S. quadrupled its grain export prices shortly after the 1971 gold suspension, the oil-exporting countries quadrupled their oil prices. I was informed at a White House meeting that U.S. diplomats had let Saudi Arabia and other Arab countries know that they could charge as much as they wanted for their oil, but that the United States would treat it as an act of war not to keep their oil proceeds in U.S. dollar assets.
This was the point at which the international financial system became explicitly extractive. But it took until 2009, for the first attempt to withdraw from this system to occur. A conference was convened at Yekaterinburg, Russia, by the Shanghai Cooperation Organization (SCO). The alliance comprised Russia, China, Kazakhstan, Tajikistan, Kirghizstan and Uzbekistan, with observer status for Iran, India, Pakistan and Mongolia. U.S. officials asked to attend as observers, but their request was rejected.
The U.S. response has been to extend the new Cold War into the financial sector, rewriting the rules of international finance to benefit the United States and its satellites – and to deter countries from seeking to break free from America's financial free ride.
The IMF changes its rules to isolate Russia and China
Aiming to isolate Russia and China, the Obama Administration's confrontational diplomacy has drawn the Bretton Woods institutions more tightly under US/NATO control. In so doing, it is disrupting the linkages put in place after World War II.
The U.S. plan was to hurt Russia's economy so much that it would be ripe for regime change ("color revolution"). But the effect was to drive it eastward, away from Western Europe to consolidate its long-term relations with China and Central Asia. Pressing Europe to shift its oil and gas purchases to U.S. allies, U.S. sanctions have disrupted German and other European trade and investment with Russia and China. It also has meant lost opportunities for European farmers, other exporters and investors – and a flood of refugees from failed post-Soviet states drawn into the NATO orbit, most recently Ukraine.
To U.S. strategists, what made changing IMF rules urgent was Ukraine's $3 billion debt falling due to Russia's National Wealth Fund in December 2015. The IMF had long withheld credit to countries refusing to pay other governments. This policy aimed primarily at protecting the financial claims of the U.S. Government, which usually played a lead role in consortia with other governments and U.S. banks. But under American pressure the IMF changed its rules in January 2015. Henceforth, it announced, it would indeed be willing to provide credit to countries in arrears other governments – implicitly headed by China (which U.S. geostrategists consider to be their main long-term adversary), Russia and others that U.S. financial warriors might want to isolate in order to force neoliberal privatization policies.  I provide the full background in "The IMF Changes its Rules to Isolate China and Russia," December 9, 2015, available on michael-hudson.com, Naked Capitalism , Counterpunch and Johnson's Russia List .
Article I of the IMF's 1944-45 founding charter prohibits it from lending to a member engaged in civil war or at war with another member state, or for military purposes generally. An obvious reason for this rule is that such a country is unlikely to earn the foreign exchange to pay its debt. Bombing Ukraine's own Donbass region in the East after its February 2014 coup d'état destroyed its export industry, mainly to Russia.
Withholding IMF credit could have been a lever to force adherence to the Minsk peace agreements, but U.S. diplomacy rejected that opportunity. When IMF head Christine Lagarde made a new loan to Ukraine in spring 2015, she merely expressed a verbal hope for peace. Ukrainian President Porochenko announced the next day that he would step up his civil war against the Russian-speaking population in eastern Ukraine. One and a half-billion dollars of the IMF loan were given to banker Ihor Kolomoiski and disappeared offshore, while the oligarch used his domestic money to finance an anti-Donbass army. A million refugees were driven east into Russia; others fled west via Poland as the economy and Ukraine's currency plunged.
The IMF broke four of its rules by lending to Ukraine: (1) Not to lend to a country that has no visible means to pay back the loan (the "No More Argentinas" rule, adopted after the IMF's disastrous 2001 loan to that country). (2) Not to lend to a country that repudiates its debt to official creditors (the rule originally intended to enforce payment to U.S.-based institutions). (3) Not to lend to a country at war – and indeed, destroying its export capacity and hence its balance-of-payments ability to pay back the loan. Finally (4), not to lend to a country unlikely to impose the IMF's austerity "conditionalities." Ukraine did agree to override democratic opposition and cut back pensions, but its junta proved too unstable to impose the austerity terms on which the IMF insisted.
U.S. neoliberalism promotes privatization carve-ups of debtor countries
Since World War II the United States has used the Dollar Standard and its dominant role in the IMF and World Bank to steer trade and investment along lines benefiting its own economy. But now that the growth of China's mixed economy has outstripped all others while Russia finally is beginning to recover, countries have the option of borrowing from the Asian Infrastructure Investment Bank (AIIB) and other non-U.S. consortia.
At stake is much more than just which nations will get the contracting and banking business. At issue is whether the philosophy of development will follow the classical path based on public infrastructure investment, or whether public sectors will be privatized and planning turned over to rent-seeking corporations.
What made the United States and Germany the leading industrial nations of the 20 th century – and more recently, China – has been public investment in economic infrastructure. The aim was to lower the price of living and doing business by providing basic services on a subsidized basis or freely. By contrast, U.S. privatizers have brought debt leverage to bear on Third World countries, post-Soviet economies and most recently on southern Europe to force selloffs. Current plans to cap neoliberal policy with the Trans-Pacific Partnership (TPP), Transatlantic Trade and Investment Partnership (TTIP) and Transatlantic Free Trade Agreement (TAFTA) go so far as to disable government planning power to the financial and corporate sector.
American strategists evidently hoped that the threat of isolating Russia, China and other countries would bring them to heel if they tried to denominate trade and investment in their own national currencies. Their choice would be either to suffer sanctions like those imposed on Cuba and Iran, or to avoid exclusion by acquiescing in the dollarized financial and trade system and its drives to financialize their economies under U.S. control.
The problem with surrendering is that this Washington Consensus is extractive and lives in the short run, laying the seeds of financial dependency, debt-leveraged bubbles and subsequent debt deflation and austerity. The financial business plan is to carve out opportunities for price gouging and corporate profits. Today's U.S.-sponsored trade and investment treaties would make governments pay fines equal to the amount that environmental and price regulations, laws protecting consumers and other social policies might reduce corporate profits. "Companies would be able to demand compensation from countries whose health, financial, environmental and other public interest policies they thought to be undermining their interests, and take governments before extrajudicial tribunals. These tribunals, organised under World Bank and UN rules, would have the power to order taxpayers to pay extensive compensation over legislation seen as undermining a company's 'expected future profits.' "
 Lori M. Wallach, "The corporation invasion," La Monde Diplomatique , December 2, 2013, http://mondediplo.com/2013/12/02tafta . She adds: "Some investors have a very broad conception of their rights. European companies have recently launched legal actions against the raising of the minimum wage in Egypt; Renco has fought anti-toxic emissions policy in Peru, using a free trade agreement between that country and the US to defend its right to pollute (6). US tobacco giant Philip Morris has launched cases against Uruguay and Australia over their anti-smoking legislation." See also Yves Smith, "Germany Bucking Toxic, Nation-State Eroding Transatlantic Trade and Investment Partnership," Naked Capitalism , July 17, 2014, and "Germany Turning Sour on the Transatlantic Trade and Investment Partnership," Naked Capitalism, October 30, 2014.
This policy threat is splitting the world into pro-U.S. satellites and economies maintaining public infrastructure investment and what used to be viewed as progressive capitalism. U.S.-sponsored neoliberalism supporting its own financial and corporate interests has driven Russia, China and other members of the Shanghai Cooperation Organization into an alliance to protect their economic self-sufficiency rather than becoming dependent on dollarized credit enmeshing them in foreign-currency debt.
At the center of today's global split are the last few centuries of Western social and democratic reform. Seeking to follow the classical Western development path by retaining a mixed public/private economy, China, Russia and other nations find it easier to create new institutions such as the AIIB than to reform the dollar standard IMF and World Bank. Their choice is between short-term gains by dependency leading to austerity, or long-term development with independence and ultimate prosperity.
The price of resistance involves risking military or covert overthrow. Long before the Ukraine crisis, the United States has dropped the pretense of backing democracies. The die was cast in 1953 with the coup against Iran's secular government, and the 1954 coup in Guatemala to oppose land reform. Support for client oligarchies and dictatorships in Latin America in the 1960 and '70s was highlighted by the overthrow of Allende in Chile and Operation Condor's assassination program throughout the continent. Under President Barack Obama and Secretary of State Hillary Clinton, the United States has claimed that America's status as the world's "indispensible nation" entitled it back the recent coups in Honduras and Ukraine, and to sponsor the NATO attack on Libya and Syria, leaving Europe to absorb the refugees.
This is not how the Enlightenment was supposed to evolve. The industrial takeoff of Germany and other European nations involved a long fight to free markets from the land rents and financial charges siphoned off by their landed aristocracies and bankers. That was the essence of classical 19 th -century political economy and 20 th -century social democracy. Most economists a century ago expected industrial capitalism to produce an economy of abundance, and democratic reforms to endorse public infrastructure investment and regulation to hold down the cost of living and doing business. But U.S. economic diplomacy now threatens to radically reverse this economic ideology by aiming to dismantle public regulatory power and impose a radical privatization agenda under the TTIP and TAFTA.
Textbook trade theory depicts trade and investment as helping poorer countries catch up, compelling them to survive by becoming more democratic to overcome their vested interests and oligarchies along the lines pioneered by European and North American industrial economies. Instead, the world is polarizing, not converging. The trans-Atlantic financial bubble has left a legacy of austerity since 2008. Debt-ridden economies are being told to cope with their downturns by privatizing their public domain.
The immediate question facing Germany and the rest of Western Europe is how long they will sacrifice their trade and investment opportunities with Russia, Iran and other economies by adhering to U.S.-sponsored sanctions. American intransigence threatens to force an either/or choice in what looms as a seismic geopolitical shift over the proper role of governments: Should their public sectors provide basic services and protect populations from predatory monopolies, rent extraction and financial polarization?
Today's global financial crisis can be traced back to World War I and its aftermath. The principle that needed to be voiced was the right of sovereign nations not to be forced to sacrifice their economic survival on the altar of inter-government and private debt demands. The concept of nationhood embodied in the 1648 Treaty of Westphalia based international law on the principle of parity of sovereign states and non-interference. Without a global alternative to letting debt dynamics polarize societies and tear economies apart, monetary imperialism by creditor nations is inevitable.
The past century's global fracture between creditor and debtor economies has interrupted what seemed to be Europe's democratic destiny to empower governments to override financial and other rentier interests. Instead, the West is following U.S. diplomatic leadership back into the age when these interests ruled governments. This conflict between creditors and democracy, between oligarchy and economic growth (and indeed, survival) will remain the defining issue of our epoch over the next generation, and probably for the remainder of the 21 st century.
 I provide the full background in "The IMF Changes its Rules to Isolate China and Russia," December 9, 2015, available on michael-hudson.com, Naked Capitalism , Counterpunch and Johnson's Russia List .
 Lori M. Wallach, "The corporation invasion," La Monde Diplomatique , December 2, 2013, http://mondediplo.com/2013/12/02tafta . She adds: "Some investors have a very broad conception of their rights. European companies have recently launched legal actions against the raising of the minimum wage in Egypt; Renco has fought anti-toxic emissions policy in Peru, using a free trade agreement between that country and the US to defend its right to pollute ( 6 ). US tobacco giant Philip Morris has launched cases against Uruguay and Australia over their anti-smoking legislation." See also Yves Smith , " Germany Bucking Toxic, Nation-State Eroding Transatlantic Trade and Investment Partnership ," Naked Capitalism , July 17, 2014 , and " Germany Turning Sour on the Transatlantic Trade and Investment Partnership ," Naked Capitalism, October 30, 2014 .
Priss Factor , Website November 30, 2017 at 5:28 am GMTMore like Dollar Supremacism
The Alarmist , Next New Comment November 30, 2017 at 8:02 am GMT"Austerity" is such a misused word these days. What the Allies did to Germany after Versailles was austerity, and everyone paid dearly for it.jilles dykstra , Next New Comment November 30, 2017 at 8:15 am GMT
What the IMF and the Western Banking Cartel do to third world countries is akin to a pusher hopping up addicts on debt and then taking it away while stripping them of their assets, pretty much hurting only the people of the third world country; certainly not the WBC, and almost certainly not the criminal elite who took the deal.
The Austerity everyone complains about in the developed world these days is a joke, hardly austerity, for it has never meant more than doing a little less deficit-spending than in prior periods, e.g. UK Labour whining about "Austerity" is a joke, as the UK debt has done nothing but grow, which in terms understandable to simple folk like me means they are spending more than they can afford to carry." The immediate question facing Germany and the rest of Western Europe is how long they will sacrifice their trade and investment opportunities with Russia, Iran and other economies by adhering to U.S.-sponsored sanctions "jacques sheete , Next New Comment November 30, 2017 at 11:29 am GMT
In the whole article not a word about the euro, also an instrument of imperialism, that mainly benefits Germany, the country that has to maintain a high level of exports, in order to feed the Germans, and import raw materials for Germany's industries.
Isolating China and Russia, with the other BRICS countries, S Africa, Brazil, India, dangerous game.
This effort forced China and Russia to close cooperation, the economic expression of this is the Peking Petersburg railway, with a hub in Khazakstan, where the containers are lifted from the Chinese to the Russian system, the width differs.
Four days for the trip.
The Berlin Baghdad railway was an important cause for WWI.
Let us hope that history does not repeat itself in the nuclear era.
Edward Mead Earle, Ph.D., 'Turkey, The Great Powers and The Bagdad Railway, A study in Imperialism', 1923, 1924, New YorkAnother excellent article.skrik , Next New Comment November 30, 2017 at 11:29 am GMT
The U.S. response has been to extend the new Cold War into the financial sector, rewriting the rules of international finance to benefit the United States and its satellites – and to deter countries from seeking t o break free from America's financial free ride .
Nah, the NY banksters wouldn't dream of doing such a thing; would they?jacques sheete , Next New Comment November 30, 2017 at 12:04 pm GMT
This is not how the Enlightenment was supposed to evolve
What I said, and beautifully put, the whole article.
World War I may well have been an important way-point, but the miserable mercantile modus operandi was well established long before.
An interesting A/B case:
a) wiki/Anglo-Persian Oil Company "In 1901 William Knox D'Arcy, a millionaire London socialite, negotiated an oil concession with Mozaffar al-Din Shah Qajar of Persia. He financed this with capital he had made from his shares in the highly profitable Mount Morgan mine in Queensland, Australia. D'Arcy assumed exclusive rights to prospect for oil for 60 years in a vast tract of territory including most of Iran. In exchange the Shah received £20,000 (£2.0 million today), an equal amount in shares of D'Arcy's company, and a promise of 16% of future profits." Note the 16% = ~1/6, the rest going off-shore.
b) The Greens in Aus researched the resources sector in Aus, to find that it is 83% 'owned' by off-shore entities. Note that 83% = ~5/6, which goes off-shore. Coincidence?
Then see what happened when the erstwhile APOC was nationalized; the US/UK perpetrated a coup against the democratically elected Mossadegh, eventual blow-back resulting in the 1979 revolution, basically taking Iran out of 'the West.'
Note that in Aus, the democratically elected so-called 'leaders' not only allow exactly this sort of economic rape, they actively assist it by, say, crippling the central bank and pleading for FDI = selling our, we the people's interests, out. Those traitor-leaders are reversing 'Enlightenment' provisions, privatising whatever they can and, as Michael Hudson well points out the principles, running Aus into debt and austerity.
We the people are powerless passengers, and to add insult to injury, the taxpayer-funded AusBC lies to us continually. Ho, hum; just like the mainly US/Z MSM and the BBC do – all corrupt and venal. Bah!
Now, cue the trolls: "But Russia/China are worse!"Biff , Next New Comment November 30, 2017 at 12:39 pm GMT
The immediate question facing Germany and the rest of Western Europe is how long they will sacrifice their trade and investment opportunities with Russia, Iran and other economies by adhering to U.S.-sponsored sanctions.
US banking oligarchs will expend the last drop of our blood to prevent a such a linking, just as they were willing to sacrifice our blood and treasure in WW1 and 2, as is alluded to here.:
Today's global financial crisis can be traced back to World War I and its aftermath.
The principle that needed to be voiced was the right of sovereign nations not to be forced to sacrifice their economic survival on the altar of inter-government and private debt demands Without a global alternative to letting debt dynamics polarize societies and tear economies apart, monetary imperialism by creditor nations is inevitable.
This is a gem of a summary.:
The past century's global fracture between creditor and debtor economies has interrupted what seemed to be Europe's democratic destiny to empower governments to override financial and other rentier interests. Instead, the West is following U.S. diplomatic leadership back into the age when these interests ruled governments. This conflict between creditors and democracy, between oligarchy and economic growth (and indeed, survival) will remain the defining issue of our epoch over the next generation, and probably for the remainder of the 21st century.
Instead, the West is following U.S. diplomatic leadership back into the age when these interests ruled governments. It's important to note that such interests have ruled (owned, actually) imperial Britain for centuries and the US since its inception, and the anti-federalists knew it.
Here is a revolution as radical as that which separated us from Great Britain.
You will find all the strength of this country in the hands of your enemies [ ed comment: the money grubbers ]
Patrick Henry June 5 and 7, 1788―1788-1789 Petersburg, Virginia edition of the Debates and other Proceedings . . . Of the Virginia Convention of 1788
The Constitution had been laid down under unacceptable auspices; its history had been that of a coup d'état.
It had been drafted, in the first place, by men representing special economic interests. Four-fifths of them were public creditors, one-third were land speculators, and one-fifth represented interests in shipping, manufacturing, and merchandising. Most of them were lawyers. Not one of them represented the interest of production -- Vilescit origine tali.
- Albert Jay Nock [Excerpted from chapter 5 of Albert Jay Nock's Jefferson, published in 1926]The golden rule is one thing. The paper rule is something else. May you live in interesting times.Jake , Next New Comment November 30, 2017 at 2:09 pm GMT"After World War I the U.S. Government deviated from what had been traditional European policy – forgiving military support costs among the victors. U.S. officials demanded payment for the arms shipped to its Allies in the years before America entered the Great War in 1917. The Allies turned to Germany for reparations to pay these debts." The Yank banker, the Yankee Wall Street super rich, set off a process of greed that led to Hitler.Joe Hide , Next New Comment November 30, 2017 at 2:12 pm GMT
But they didn't invent anything. They learned from their WASP forebears in the British Empire, whose banking back to Oliver Cromwell had become inextricably entangled with Jewish money and Jewish interests to the point that Jews per capita dominated it even at the height of the British Empire, when simpleton WASPs assume that WASPs truly ran everything, and that WASP power was for the good of even the poorest WASPs.To Michael Hudson,The Alarmist , Next New Comment November 30, 2017 at 2:13 pm GMT
Great article. Evidence based, factually argued, enjoyably readable.
Replacements for the dollar dominated financial system are well into development. Digital dollars, credit cards, paypal, stock and currency exchange online platforms, and perhaps most intriguing The exponential rise of Bitcoin and similar crypto-currencies.
The internet is also exponentially exposing the screwing we peasants have been getting by the psychopath, narcissistic, hedonistic, predatory lenders and controllers. Next comes the widespread, easily usable, and inexpensive cell phone apps, social media exposures, alternative websites (like Unz.com), and other technologies that will quickly identify every lying, evil, jerk so they can be neutrilized / avoidedAstuteobservor II , Next New Comment November 30, 2017 at 2:26 pm GMT
"Textbook trade theory depicts trade and investment as helping poorer countries catch up, compelling them to survive by becoming more democratic to overcome their vested interests and oligarchies along the lines pioneered by European and North American industrial economies."
I must be old; the economic textbooks I had did explain the benefits of freer trade among nations using Ricardo and Trade Indifference Curves, but didn't prescribe any one political system being fostered by or even necessary for the benefits of international trade to be reaped.to be honest, this way of running things only need to last for 10-20 more years before automation will replace 800 million jobs. then we will have a few trillionaire overlords unless true AI comes online. by that point nothing matters as we will become zoo animals.jacques sheete , Next New Comment November 30, 2017 at 2:36 pm GMT@The Alarmistjacques sheete , Next New Comment November 30, 2017 at 2:48 pm GMT
What the IMF and the Western Banking Cartel do to third world countries is akin to a pusher hopping up addicts on debt and then taking it away while stripping them of their assets, pretty much hurting only the people of the third world country; certainly not the WBC, and almost certainly not the criminal elite who took the deal.
That's true and the criminals do similar asset stripping to their own as well, through various means.
It's always the big criminals against the rest of us.@jilles dykstrajacques sheete , Next New Comment November 30, 2017 at 2:51 pm GMT
The Berlin Baghdad railway was an important cause for WWI.
Bingo. Stopping it was a huge factor. There was no way the banksters of the world were going to let that go forward, nor were they going to let Germany and Russia link up in any other ways. They certainly were not about to allow any threats to the Suez Canal nor any chance to let the oil fields slip from their control either.
The wars were also instigated to prevent either Germany or Russia having control of, and free access to warm water ports and the wars also were an excuse to steal vast amounts of wealth from both Germany and Russia through various means.
All pious and pompous pretexts aside, economics was the motive for (the) war (s), and the issues are not settled to this day. I.e., it's the same class of monstrously insatiable criminals who want everything for themselves who're causing the major troubles of the day.
Unfortunately, as long as we have SoB's who're eager to sacrifice our blood and treasure for their benfit, things will never change.Michael Kenny , Next New Comment November 30, 2017 at 3:01 pm GMT
The golden rule is one thing. The paper rule is something else.
May you live in interesting times.
The golden rule is for dreamers, unfortunately. Those who control paper money rule, and your wish has been granted; we live in times that are both interesting and fascinating, but are nevertheless the same old thing. Only the particular particulars have changed.Essentially, the anti-EU and anti-euro line that Professor Hudson has being pushing for years, which has now morphed into a pro-Putin line as the anti-EU faction in the US have sought to use Putin as a "useful idiot" to destroy the EU. Since nobody in Europe reads these articles, Ii doesn't really matter and I certainly don't see any EU leader following the advice of someone who has never concealed his hostility to the EU's very existence: note the use of the racist slur "PIIGS" to refer to certain EU Member States. Thus, Professor Hudson is simply pushing the "let Putin win in Ukraine" line dressed up in fine-sounding economic jargon.jacques sheete , Next New Comment November 30, 2017 at 3:54 pm GMTAnonymous , Disclaimer Next New Comment November 30, 2017 at 4:08 pm GMT
Since nobody in Europe reads these articles, Ii doesn't really matter
None of it rally matters anyway, no matter how valid. To paraphrase Thucydides, the money grubbers do what they want and the rest of us are forced to suck it up and limp along.
and I certainly don't see any EU leader following the advice
I doubt that that's Hudson's intent in writing the article. I see it as his attempt to explain the situation to those of us who care about them even though our concern is pretty much useless.
I do thank him for taking the time to pen this stuff which I consider worthwhile and high quality.That sounds good but social media is the weapon of choice in the EU too. Lot's of kids know and love Hudson. Any half capable writer who empathetically explains why you're getting fucked is going to have some followers. Watering, nutrition, weeding. Before too long you'll be on the Eurail to your destination.Wally , Website Next New Comment November 30, 2017 at 4:23 pm GMT@Jakenickels , Next New Comment November 30, 2017 at 4:48 pm GMT
said: "The Yank banker, the Yankee Wall Street super rich, set off a process of greed that led to Hitler." If true, so what? That's a classic example of 'garbage in, garbage out'. http://www.codoh.comWilliam McAdoo , Next New Comment November 30, 2017 at 5:08 pm GMT
This is not how the Enlightenment was supposed to evolve
In fact, this is exactly how it was supposed to work. The wave of liberal democracies was precisely to overturn the monarchies, which were the last bulwark protecting the people from the full tyranny of the financiers, who were, by nature, one-world internationalists.The real problem with this is that any form of monetary arrangement involves an implied trusteeship, with obligations on, as well as benefits for, the trustee. The US is so abusing its trusteeship through the continual use of an irresponsible sanctions regime that it risks a good portion of the world economy abandoning its system for someone else's, which may be perceived to be run more responsibility. The disaster scenario would be the US having therefore in the future to access that other system to purchase oil or minerals, and having that system do to us what we previously did to them -- sanction us out.joe webb , Next New Comment November 30, 2017 at 10:11 pm GMT
The proper use by the US of its controlled system thus should be a defensive one -- mainly to act so fairly to all players that it, not someone else, remains in control of the dominant worldwide exchange system. This sensible course of conduct, unfortunately, is not being pursued by the US.there is fuzzy, and then there is very fuzzy, and then there is the fuzziness compounded many-fold. The latter is this article.Wally, Next New Comment December 1, 2017 at 1:49 am GMT
Here from wiki: "
" Marx believed that capitalism was inherently built upon practices of usury and thus inevitably leading to the separation of society into two classes: one composed of those who produce value and the other, which feeds upon the first one. In "Theories of Surplus Value" (written 1862-1863), he states " that interest (in contrast to industrial profit) and rent (that is the form of landed property created by capitalist production itself) are superfetations (i.e., excessive accumulations) which are not essential to capitalist production and of which it can rid itself."
Wiki goes on to identify "rentier" as used by Marx, to be the same thing as "capitalists." What the above quotation says is that capitalism CAN rid itself of genuine rent capital. First, the feudal rents that were extracted by landowners were NOT part of a free market system. Serfdom was only one part of unfree conditions. A general condition of anarchy in rules and laws by petty principalities characteristic of feudalism, both contained commerce and human beings. There was no freedom, political or economic.
The conflation (collapsing) of rents and interest is a Marxist error which expands into complete nonsense when a competitive economy has replaced feudal conditions. ON top of that, profits from a business, firm, or industrial enterprise are NOT rents.
Any marxist is a fool to pretend otherwise, and is just another ideological (False consciousness ) fanatic.
... ... ...@Michael KennyThreeCranes , December 1, 2017 at 3:34 am GMT
Indeed, Putin should be praised & supported. But where is the proof that 'Russia & Trump colluded to get Trump elected'? You also ignore the overwhelming Crimean support for returning to Russia. And you won't like this at all: Trump Declares "National Day for the Victims of Communism." https://www.whitehouse.gov/the-press-office/2017/11/07/national-day-victims-communism Hence, the Liars of the scamming "Holocau$t Industry" go crazy: https://www.salon.com/2017/11/07/trumps-national-day-for-the-victims-of-communism-is-opposite-of-holocaust-statement/@jilles dykstra
Germany loans money back to the poorer nations who buy her exports just as China loans money to the United States (they purchase roughly a third of our Treasury bonds) so that Americans can continue to buy Chinese manufactured goods.
The role to be played by the USA in the "new world order" is that of being the farmer to the world. The meticulous Asians will make stuff.
The problem with this is that it is based on 19th century notions of manufacturing. Technique today is vastly more complicated than it was in the 1820′s and a nation must do everything in its power to protect and nurture its manufacturing and scientific excellence. In the United States we have been giving this away to our competitors. We educate their children at our taxpayer's expense and they take the knowledge gained back to their native countries where, with state subsidies, they build factories that put Americans out of work. We fall further and further behind.
Nov 29, 2017 | marknesop.wordpress.com
marknesop , , November 28, 2017 at 2:13 pmHa, ha!!! The Victim Of The Aggressor Country seldom fails to entertain. Here we have VR Deputy Chairperson Ira Gerashchenko bossing Europe around , and telling it that the Victim Of The Aggressor Country's parliamentary delegation will continue to insist on Russia not returning to the Council of Europe. Because, she says, Russia has stolen part of the territory of the VOTAC which was a gift from Russia in the first place (although she doesn't mention that last part), thereby setting a precedent for every country which has a province 'liberated' by the west to term it stolen by the west. But that wasn't my favourite part. No; this is – "We live at the time of a certain degrading of European institutions and their external weakening, including by Russia. You can accept it and go with the flow but you can also recognize the fact try to resist it."
Beautiful, Ira!! Inspiring!! And how many degraded European leaders are Billionaires who openly own an impressive slate of businesses and media in their countries, which they continue to operate and profit from while piously declaring their only interest is the welfare of the country? Which is, by the bye, the most corrupt country in Europe ? How many Prosecutors-General has the VOTAC had since its glorious liberation from the yoke of the Moskali? Yes, you can certainly teach Yurrup a thing or two about integrity.
It must be embarrassing to be European these days. To be dressed down by the corrupt country you support on handouts because you are not doing enough to support it. First we had the 'Me' generation. Then we had the 'Me' country.
SA is cursed with neo-liberal trickle-down baloney stifling radical economic change Kevin Humphrey, The New Age, Johannesburg, 1 December 2016
South Africa's massive inequalities are abundantly obvious to even the most casual observer. When the ANC won the elections in 1994, it came armed with a left-wing pedigree second to none, having fought a protracted liberation war in alliance with progressive forces which drew in organised labour and civic groupings.
At the dawn of democracy the tight knit tripartite alliance also carried in its wake a patchwork of disparate groupings who, while clearly supportive of efforts to rid the country of apartheid, could best be described as liberal. It was these groupings that first began the clamour of opposition to all left-wing, radical or revolutionary ideas that has by now become the constant backdrop to all conversations about the state of our country, the economy, the education system, the health services, everything. Thus was the new South Africa introduced to its own version of a curse that had befallen all countries that gained independence from oppressors, neo-colonialism.
By the time South Africa was liberated, neo-colonialism, which as always sought to buy off the libera-tors with the political kingdom while keep-ing control of the economic kingdom, had perfected itself into what has become an era where neo-liberalism reigns supreme. But what exactly is neo-liberalism? George Monbiot says: "Neo-liberalism sees competi-tion as the defining characteristic of human relations. It redefines citizens as consumers, whose democratic choices are best exercised by buying and selling, a process that rewards merit and punishes inefficiency. It maintains that 'the market' delivers benefits that could never be achieved by planning."
There is consensus between commentators who have studied the effects of neo-liberalism that it has become all pervasive and is the key to ensuring that the rich remain rich, while the poor and the merely well to do continue on a perpetual hamster's wheel, going nowhere and never improving their lot in life while they serve their masters.
Monbiot says of this largely anonymous scourge: "Attempts to limit competition are treated as inimical to liberty. Tax and regulations should be minimised, public services should be privatised. The organisation of labour and collective bargaining by trade unions are portrayed as market distortions that impede the formation of a natural hierarchy of winners and losers. Inequality is recast as virtuous, a reward for utility and a genera-tor of wealth, which trickles down to enrich everyone. Efforts to create a more equal society are both counterproductive and morally corrosive. The market ensures that everyone gets what they deserve."
South Africa's sad slide into neo-liberalism was given impetus at Davos in 1992 where Nelson Mandela had this to say to the assembled super rich: "We visualise a mixed economy, in which the private sector would play a central and critical role to ensure the creation of wealth and jobs. Future economic policy will also have to address such questions as security of investments and the right to repatriate earnings, realistic exchange rates, the rate of inflation and the fiscus."
Further insight into this pivotal moment was provided by Anthony Sampson, Mandela's official biographer who wrote: "It was not until February 1992, when Mandela went to the World Economic Forum in Davos, Switzerland, that he finally turned against nationalisation. He was lionised by the world's bankers and industrialists at lunches and dinners."
This is not to cast any aspersions on Mandela, he had to make these decisions at the time to protect our democratic transition. But these utterances should have been accom-panied by a behind the scenes interrogation of all the ANC's thoughts on how to proceed in terms of the economy delivering socialist orientated solutions without falling into the minefield of neo-liberal traps that lay in wait for our emerging country.
Senior cadres co-opted Unfortunately, history shows that some key senior cadres of the ANC were all too keen to be coopted into the neo-liberal fold and any attempts to put forward radical measures that would bring something fresh to the table to address the massive inequalities of the past were and continue to be kept off the table and we are still endlessly fed the neo-liberal trickle-down baloney.
Now no one dares to express any type of radical approach to our economic woes unless it is some loony populist. Debate around these important issues is largely missing and the level of commentary on all important national questions is shockingly shallow.
Anti-labour, anti-socialist, anti-poor, anti-black The status quo as set by the largely white-owned media revolves around key neo-liberal slogans mas-querading as commentary that is anti-labour, anti-socialist and anti-poor, which sadly translates within our own context as anti-black and therefore repugnantly racist.
We live in a country where the black, over-whelmingly poor majority of our citizens have voted for a much revered liberation movement that is constantly under attack from within and without by people who do not have their best interests at heart and are brilliant at manipulating outcomes to suit themselves on a global scale.
Kevin Humphrey is associate executive editor of The New Age
July 2, 2015
Local franchise of accountancy giant Grant Thornton was working for three of the country's largest banks when $1bn was embezzled
One of the world's leading auditors has been accused of negligence and incompetence after $1bn was siphoned out of Moldova from under its nose – a sum equivalent to 15% of the former Soviet republic's GDP.
Grant Thornton, the UK based accountancy giant with local franchises in dozens of countries, was the auditor for three of Moldova's largest banks through which the money was embezzled and spirited out of the country in complex financial transactions, some through UK companies.
As a result, the authorities had to rescue the three banks with a bailout equivalent to half the annual budget. The knock-on effect was a currency collapse and a plunge towards recession, ruining the economy almost overnight. Moldova is already Europe's poorest country.
The theft was discovered in November 2014 at Unibank, Banca de Economii and Banca Sociala , which the Moldovan member of Grant Thornton, a global network of independent firms, has been auditing since 2010, 2011 and 2013 respectively.
Iurie Chirinciuc, a Moldovan MP who was part of a commission set up to investigate the affair, believes Grant Thornton was negligent and obstructive.
"All the [audit] reports give positive opinions," he said. "How can you give a positive opinion when the situation at these banks was so grave?"
Grant Thornton said it drew the attention of the banks and relevant authorities to its concerns about the banks and that its audit reports contained alerts about loans. But Chirinciuc said it should not have given the banks a generally clean bill of health.
He claims repeated requests for the auditors to give testimony to the inquiry were "vehemently opposed".
"I have made a formal request for analysis of Grant Thornton to the central bank," Chirinciuc said. "In the commission, I was shocked to see that all state institutions were informed and updated as to the situation at the banks, but did not intervene. These circumstances make me think that very high-ranking dignitaries are involved in the theft of the billion."
Chirinciuc was also aghast that after the fraud was discovered, Grant Thornton's Moldova director, Stéphane Bridé, was appointed economy minister. Bridé told the Guardian his nomination "was made in conformity with the legislation of the Republic of Moldova, according to which my professional qualities and experience were exclusively considered".
Multiple spurious loans were granted by Banca de Economii and Unibank on the basis of false guarantees to companies that then transferred the money offshore. Some went to British companies controlled by entities registered in places where directors' identities are kept secret.Two preliminary reports – one by the parliamentary commission and the other by corporate investigation firm Kroll – suggest that fraud eventually became the main occupation of the banks.
The parliamentary report says: "The management of the banks have manifested evident lapses in professionalism and integrity … by giving credits that were compromised from the beginning" and made transactions of "fictional and fraudulent character". The MPs concluded the banks had knowingly endangered their "capacity to make basic operations" such as paying out pensions and public sector salaries.
The banks consistently misrepresented cash balances by using unorthodox "overnight deposits" – zero-interest deposits from Russian banks Interprombank, Gazprombank, Alef Bank and Metrobank – to disguise the lack of capital while continuing to give out nonperforming loans. "In essence these operations were operations of manipulation," the parliamentary report says.
So contaminated have the banks become that the IMF and World Bank have suspended programmes with Moldova, and the EU is considering following suit. World Bank country manager Alex Kremer said last week: "We are advising the authorities that the three banks ... should be liquidated." He said trying to nationalise or recapitalise the banks would risk wasting more taxpayers' money.
Moldovan prosecutors have since launched an investigation that has so far put about 30 people under criminal indictment, including bank executives. Among these is Ilan Shor, chairman of the board at Banca de Economii since April 2014, allegedly the mastermind. Shor was released from house arrest on 23 May, having agreed to cooperate with investigators. The chief prosecutor has not returned a request for comment. Shor denies wrongdoing. Earlier this month, he was elected mayor of the small town of Orhei.
Kroll's confidential report was published online in April by the speaker of the Moldovan parliament, Andrian Candu. It says a group of companies under Shor's control gradually took over the banks and in 2010 started giving never-to-be-repaid loans to themselves. When watchdogs closed in, "orders were given by management of the banks to archive loan documentation relating to the suspicious transactions". A vehicle belonging to another Shor company that collected the paperwork was subsequently stolen and burned.
Between 2011, when Shor's companies were allegedly beginning to sink their teeth into the banks, and October 2014 when the scam went bust, Kroll found the number of Shor-related companies involved grew from 10 to 39. By December 2014, 90% of Unibank's loans were to Shor group companies. Deposits recorded as being from Russian banks, which enabled Banca de Economii to make huge loans, were not received.
"Ilan Shor and individuals associated with him played an integral role in coordinating this activity," Kroll says in its report, claiming there was "a deliberate intention to extract as much benefit as possible for entities connected to Mr Shor and to the detriment of the bank". A Kroll representative said the report was leaked without consent and declined to comment further.
The "missing billion" contributed to a run on the Moldovan leu in which it lost a quarter of its value against the dollar in February.
Grant Thornton had no presence in Moldova before 2010, but its ascent has been startling. Seven of the country's 14 biggest banks became its clients in the space of four years, making it by far the biggest player in the market. International competitors such as KPMG and Deloitte steadily lost Moldova to Grant Thornton, with neither having more than two major banks on their roster in the country by 2013.
Representatives of the Moldovan Grant Thornton franchise deny impropriety and say that that auditors cannot be held responsible if clients do not disclose full financial information.
"While we would like to detect all fraud, according to International Standards of Auditing, the auditors' role is not to discover fraud, or to prosecute clients for fraud," they said in a statement. "We stand by the quality of our work – which is public record - and believe the audit opinions were correct under the circumstances."
A spokesman for the global office said Grant Thornton member firms acted autonomously and their work was only scrutinised by head office every three years. It did not respond to a question asking what it planned to do about its relationship with GT Moldova.
A Moldovan financial system insider who wishes to remain anonymous said: "It's clear Grant Thornton was at least negligent if not worse. How could it not have known what was going on, especially at Unibank where the scam was almost total?"
In its response, GT Moldova said: "Various observations were mentioned annually in the letters we addressed to management and shareholders of these banks and to the National Banks of Moldova.
"We wish to remind you that in 2013, the inquiry commission for the assets of Banca de Economii was based not only on the audit of the court and reports of the International Monetary Fund but also mentions of Grant Thornton audit."
The effect of the financial loss has been felt by ordinary Moldovans. Ion Preașcă, a finance journalist in ther capital Chișinău, said: "We have organised crime specialised in finance. As a consequence of the discovery of the theft, the banks stopped issuing loans for a while. There was a domino effect which hit the leu."
Alexei, who owns a small construction business, said: "They will invent some new taxes to make up for the damage. I had an account at Banca Sociala and have stopped using it since. I opened two new accounts in banks with foreign ownership."
Natasha, a bookkeeper, said: "The resulting price rises had bad effects. The electricity price nearly doubled from one month to the next. The bill was 300 lei [£10] and it's now 500. Pensions and salaries haven't increased."
The criminal investigation is ongoing. Neither the Moldovan National Bank or government returned requests for information. An estimated 50,000 Moldovans protested on 3 May in Chișinău, demanding justice and the recovery of the stolen money.
Thanks to Iurie Sanduta, editor of www.rise.md, for help researching this article.
Nov 15, 2017 | www.nakedcapitalism.com
Alex Azar: Can There Be Uglier Scenarios than the Revolving Door? Posted on November 15, 2017 by Lambert Strether By Lambert Strether
Clearly, Alex Azar, nominated yesterday for the position of Secretary of Health and Human Services by the Trump Administration, exemplifies the case of the "revolving door," through which Flexians slither on their way to (or from) positions of public trust. Roy Poses ( cross-posted at NC ) wrote, when Azar was only Acting Secretary:
Last week we noted that Mr Trump famously promised to “drain the swamp” in Washington. Last week, despite his previous pledges to not appoint lobbyists to powerful positions, he appointed a lobbyist to be acting DHHS Secretary. This week he is apparently strongly considering Mr Alex Azar, a pharmaceutical executive to be permanent DHHS Secretary, even though the FDA, part of DHHS, has direct regulatory authority over the pharmaceutical industry, and many other DHHS policies strongly affect the pharmaceutical industry. (By the way, Mr Azar was also in charge of one lobbying effort.)
So should Mr Azar be confirmed as Secretary of DHHS, the fox guarding the hen house appears to be a reasonable analogy.
Moreover, several serious legal cases involving bad behavior by his company, and multiple other instances of apparently unethical behavior occurred on Mr Azar’s watch at Eli Lilly. So the fox might be not the most reputable member of the species.
So you know the drill…. The revolving door is a species of conflict of interest . Worse, some experts have suggested that the revolving door is in fact corruption. As we noted here , the experts from the distinguished European anti-corruption group U4 wrote ,
The literature makes clear that the revolving door process is a source of valuable political connections for private firms. But it generates corruption risks and has strong distortionary effects on the economy , especially when this power is concentrated within a few firms.
The ongoing parade of people transiting the revolving door from industry to the Trump administration once again suggests how the revolving door may enable certain of those with private vested interests to have excess influence, way beyond that of ordinary citizens, on how the government works, and that the country is still increasingly being run by a cozy group of insiders with ties to both government and industry. This has been termed crony capitalism.
Poses is, of course, correct. (Personally, I've contained my aghastitude on Azar, because I remember quite well how Liz Fowler transitioned from Wellpoint to being Max Baucus's chief of staff when ObamaCare was being drafted to a job in Big Pharma , and I remember quite well the deal with Big Pharma Obama cut, which eliminated the public option , not that the public option was anything other than a decreasingly gaudy "progressive" bauble in the first place.)
In this post, I'd like to add two additional factors to our consideration of Azar. The first: Democrat credentialism makes it hard for them to oppose Azar. The second: The real damage Azar could do is on the regulatory side.
First, Democrat credentialism. Here is one effusive encomium on Azar. From USA Today, "Who is Alex Azar? Former drugmaker CEO and HHS official nominated to head agency" :
"I am glad to hear that you have worked hard, and brought fair-minded legal analysis to the department," Sen. Max Baucus said at Azar's last confirmation hearing.
Andy Slavitt, who ran the Affordable Care Act and the Centers for Medicare & Medicaid Services during the Obama administration, said he has reason to hope Azar would be a good secretary.
"He is familiar with the high quality of the HHS staff, has real-world experience enough to be pragmatic, and will hopefully avoid repeating the mistakes of his predecessor," Slavitt said.
So, if Democrats are saying Azar is "fair-minded" and "pragmatic" -- and heaven forfend that the word "corruption" even be mentioned -- how do they oppose him, even he's viscerally opposed to everything Democrats supposedly stand for? (Democrats do this with judicial nominations, too.) Azar may be a fox, alright, but the chickens he's supposedly guarding are all clucking about how impeccable his qualifications are!
Second, let's briefly look at Azar's bio. Let me excerpt salient detail from USA Today :
1. Azar clerked for Supreme Court Justice Antonin .
2. Azar went to work for his mentor, , who was heading the independent counsel investigation into Bill and Hillary Clinton's Whitewater land deal.
3. Azar had a significant role in another major political controversy when the outcome of hinged on a . Azar was on the Bush team of lawyers whose side ultimately prevailed 
For any Democrat with a memory, that bio provokes one of those "You shall know them by the trail of the dead" moments. And then there's this:
When Leavitt replaced Thompson in 2005 and Azar became his deputy, Leavitt delegated a lot of the rule-making process to Azar.
So, a liberal Democrat might classify Azar as a smooth-talking reactionary thug with a terrible record and the most vile mentors imaginable, and on top of it all, he's an effective bureaucratic fixer. What could the Trump Administration possibly see in such a person? Former (Republican) HHS Secretary Mike Leavitt explains:
"Understanding the administrative rule process in the circumstance we're in today could be extraordinarily important because a lot of the change in the health care system, given the fact that they've not succeeded legislatively, could come administratively."
We outlined the administration strategy on health care in "Trump Adminstration Doubles Down on Efforts to Crapify the Entire Health Care System (Unless You're Rich, of Course)" . There are three prongs:
1) Administratively, send ObamaCare into a death spiral by sabotaging it
2) Legislatively, gut Medicaid as part of the "tax refom" package in Congress
3) Through executive order, eliminate "essential health benefits" through "association health plans"
As a sidebar, it's interesting to see that although this do-list is strategically and ideologically coherent -- basically, your ability to access health care will be directly dependent on your ability to pay -- it's institutionally incoherent, a bizarre contraption screwed together out of legislation, regulations, and an Executive order. Of course, this incoherence mirrors to Rube Goldberg structure of ObamaCare itself, itself a bizarre contraption, especially when compared to the simple, rugged, and proven single payer system. ( . We might compare ObamaCare to a child born with no immune system, that could only have survived within the liberal bubble within which it was created; in the real world, it's not surprising that it's succumbing to opportunistic infections.)
On #1, The administration has, despite its best efforts, not achieved a controlled flight into terrain with ObamaCare; enrollment is up. On #2, the administration and its Congressional allies are still dickering with tax reform. And on #3 . That looks looks like a job for Alex Azar, since both essential health benefits and association health plans are significantly affected by regulation.
So, yes, there are worse scenarios than the revolving door; it's what you leave behind you as the door revolves that matters. It would be lovely if there were a good old-fashioned confirmation battle over Azar, but, as I've pointed out, the Democrats have tied their own hands. Ideally, the Democrats would junk the Rube Goldberg device that is ObamaCare, rendering all of Azar's regulatory expertise null and void, but that doesn't seem likely, given that they seem to be doing everything possible to avoid serious discussion of policy in 2018 and 2020.
 I'm leaving aside what will no doubt be the 2018 or even 2020 issue of drug prices, since for me that's subsumed under the issue of single payer. If we look only at Azar's history in business, real price decreases seem unlikely. Business Insider :
Over the 10-year period when Azar was at Lilly, the price of insulin notched a three-fold increase. It wasn't just Lilly's insulin product, called Humalog. The price of a rival made by Novo Nordisk has also climbed, with the two rising in such lockstep that you can barely see both trend lines below.
The gains came despite the fact that the insulin, which as a medication has an almost-century-long history, hasn't really changed since it was first approved.
Nice business to be in, eh? Here's that chart:
It's almost like Lilly (Azar's firm) and Novo Nordisk are working together, isn't it?
 Anyhow, as of the 2016 Clinton campaign , the Democrat standard -- not that of Poses, nor mine -- is that if there's no quid pro quo, there's no corruption.
 And, curiously, "[HHS head Tommy] Thompson said HHS was in the eye of the storm after the 2001 terrorist attacks, and Azar had an important role in responding to the resulting public health challenges, as well as the subsequent anthrax attacks "
MedicalQuack , November 15, 2017 at 10:31 amdiptherio , November 15, 2017 at 11:25 am
Oh please, stop quoting Andy Slavitt, the United Healthcare Ingenix algo man. That guy is the biggest crook that made his money early on with RX discounts with his company that he and Senator Warren's daughter, Amelia sold to United Healthcare. He's out there trying to do his own reputation restore routine. Go back to 2009 and read about the short paying of MDs by Ingenix, which is now Optum Insights, he was the CEO and remember it was just around 3 years ago or so he sat there quarterly with United CEO Hemsley at those quarterly meetings. Look him up, wants 40k to speak and he puts the perception out there he does this for free, not so.a different chris , November 15, 2017 at 2:01 pm
I think you're missing the context. Lambert is quoting him by way of showing that the sleazy establishment types are just fine with him. Thanks for the extra background on that particular swamp-dweller, though.petal , November 15, 2017 at 12:52 pm
Not just the context, it's a quote in a quote. Does make me think Slavitt must be a real piece of work to send MQ so far off his railssgt_doom , November 15, 2017 at 1:21 pm
Alex Azar is a Dartmouth grad (Gov't & Economics '88) just like Jeff Immelt (Applied Math & Economics '78). So much damage to society from such a small department!Jen , November 15, 2017 at 7:56 pm
Nice one, petal !!!
Really, all I need to know about the Trumpster Administration:
From Rothschild to . . . .
Since 2014, Ross has been the vice-chairman of the board of Bank of Cyprus PCL, the largest bank in Cyprus.
He served under U.S. President Bill Clinton on the board of the U.S.-Russia Investment Fund. Later, under New York City Mayor Rudy Giuliani, Ross served as the Mayor's privatization advisor.jo6pac , November 15, 2017 at 2:13 pm
Or from a "small liberal arts college" (which is a university in all but name, because alumni).
Tim Geitner ('82 – Goverment)
Hank Paulson ('68 – English)Alfred , November 15, 2017 at 2:53 pm
Well it's never ending game in the beltway and we serfs aren't in it.
I don't believe that the President's "swamp" ever consisted of crooked officials, lobbyists, and cronies I think it has always consisted of those regulators who tried sincerely to defend public interests.
It was in the sticky work of those good bureaucrats that the projects of capitalists and speculators bogged down. It is against their efforts that the pickup-driving cohort of Trump_vs_deep_state (with their Gadsden flag decals) relentlessly rails.
Trump has made much progress in draining the regulatory swamp (if indeed that is the right way to identify it), and no doubt will make considerably more as time wears on, leaving America high and dry. The kind of prevaricator Trump is may simply be the one who fails to define his terms.
Henry Moon Pie , November 15, 2017 at 4:13 pm
I think we've moved past the revolving door. We hear members of the United States Senate publicly voice their concerns about what will happen if they fail to do their employers' bidding (and I'm not talking about "the public" here). In the bureaucracy, political appointees keep accruing more and more power even as they make it clearer and clearer that they work for "the donors" and not the people. Nowhere is this more true than the locus through which passes most of the money: the Pentagon. The fact that these beribboned heroes are, in fact, setting war policy on their own makes the knowledge that they serve Raytheon and Exxon rather than Americans very, very troubling.
I suspect Azar's perception is that he is just moving from one post to another within the same company.
Watt4Bob , November 15, 2017 at 5:28 pmLarry , November 15, 2017 at 8:01 pm
Perfect cartoon over at Truthout
I'm amazed there is enough private security available on this planet to keep these guys safe.
Big pharma indeed has so much defense from the supposed left. It combines their faith in technological progress, elite institutions, and tugs on the heart strings with technology that can save people from a fate of ill health or premature death. Of course, the aspect of the laws being written to line the pockets of corrupt executives is glossed over. While drug prices and medical costs spiral ever higher, our overall longevity and national health in the US declines. That speaks volumes about what Democrats really care about.
Nov 07, 2017 | marknesop.wordpress.com
Patient Observer , November 6, 2017 at 1:02 pmDid not the Kremlin Stooges predict this years ago?marknesop , November 6, 2017 at 1:15 pm
The international organization for migration has published official data which shows that every fourth prostitute in Europe is a citizen of Ukraine.
The article discusses pamphlets that are distributed to young Ukrainian girls/women advising them on how to survive and flourish in new realities of life in the EU.
the Ukrainian labor market is being formed and is growing. Even if there is no other work and none is expected, girls should know that Europe will take care of them. The younger generation of Ukrainian schoolgirls will find out how to apply themselves If you are involved in the sex business, then this brochure is for you," it is said in the introduction. "You have chosen a very dangerous profession, but if you always follow these simple rules, then you will get a chance to live a long life You shouldn't serve several clients alone, you should avoid drunk clients, and also always to take payment in advance. And when you go to the client's apartment, try to learn in what district of the city it is located, give preference to hotels".It's okay if you're a hooker, and all you have to sell is yourself. You have chosen a dangerous profession, but really the writing was on the wall, wasn't it, if only you'd had sense to read it? And the economic calamity which has come to pass in your country is really no concern of ours, while for our part we are not too upset at being offered the choice of some of the most beautiful young women on the planet, who will do anything you say for a handful of euros.
Here's to your bright new future in the EU. Incredible. I wonder if Poroshenko will tout this statistic as another validation of Ukrainians' confidence in his leadership.
Oct 25, 2017 | www.nakedcapitalism.com
Synoia , October 23, 2017 at 2:21 pmGlen , October 23, 2017 at 2:31 pm
 Too bad we don't have a Jobs Guarantee .
The most important things are guaranteed:
Funding the military, enforcing payment of debts, Profit, promises made to campaign contributors, and of course death and taxes.HotFlash , October 23, 2017 at 3:06 pm
Somehow, I think our government's response to PR/Maria will be the new norm unless there are a bunch of billionaire's calling the gov reps they bought to complain. And even they may be frustrated by the current boob in the WH.PKMKII , October 23, 2017 at 3:27 pm
although I haven't heard of private equity pushing Puerto Rican toll roads they would own
My dear Lambert, were I a vulture capitalist (which I am not!), I would not put one plugged nickel into infrastructure in PR. Not toll roads, not resorts, not power grid, not rebuilding the pharma factories, nada. Because another Maria will just happen again and trash it all before sufficient ROI, and who's gonna insure it now? Insurance companies believe in climate change, whether they will admit it or not.
But I would put a few $$$ into PR debt, and gamble that the US govt will bail *me*and my fellow vultures (not PR) out. Am I cynical enough?Code Name D , October 23, 2017 at 3:32 pm
The Intercept has a good article on a Puerto Rican recovery for Puerto Ricans and not outside interests.HotFlash , October 23, 2017 at 4:23 pm
What about the cars? I would imagine that many cars were destroyed, heavely damaged, or simply lost. Getting cars repaired and replaced will also be a major challenge. And this I bet would fall on the backs of the individual owners who will already be strapped for cash to begin with.cocomaan , October 23, 2017 at 3:41 pm
Pretty well, yup. Insurance companies gonna pay pennies on the dollar, assuming you actually have insurance for stuff like this. Poor people tend to get the very minimum needed to get their vehicle on the road, which is usually liability. If you do have bountiful; coverage for Acts O'God, where are you going to get your car repaired or replaced anyway? This may sound super-cynical, even for me, but looking at those washed out and blown-away roads, getting cargo into remote places in PR is a job for sure-footed critters like mules and horses. Dirt bikes can move people over difficult terrain. So can bicycles , and they have been preparing for such a thing.a different chris , October 23, 2017 at 5:21 pm
The crisis in PR compared to the crises in FL and TX really opened my eyes to how dangerous and precarious it must be to live on an island, even one ostensibly connected to a powerful country. The logistical nightmare of getting things there is compounded so much by that sea barrier. At least in TX, you can call in the cajun navy who can drive their boats to the location, then launch.
So now one thing is even clearer to me: the first losers of rising sea levels and climate change disasters will be islanders. Places like the Maldives and the Leewards will have a really hard time in the next few decades.cocomaan , October 23, 2017 at 6:39 pm
>is compounded so much by that sea barrier.
??? The sea is how people got things everywhere long, long before the first steam engine (and I'm talking those Roman toy ones) was even conceived?
This is just incompetence. Load up cargo ships (which are the most enormous transportation devices on the planet) and bring an aircraft carrier or two with cargo helicopters to bring the goods inland:
"The CH-53E heavylift transport helicopter can carry cargo with a maximum weight of 13.6 t internally or 14.5 t externally."
But yes, agree on the precarity of island life.rd , October 23, 2017 at 6:01 pm
I get what both of you are saying vis a vis sea travel, Jones Act and all, but even in the best of all possible human organizations, it's still a major factor in any relief effort. It's just not nearly as easy to get people from point A to point B by boat. If your car breaks down, you're stranded, if your boat breaks down, you could easily die.Joel , October 23, 2017 at 11:50 pm
Much of the sea barrier is man-made, namely the Jones Act. As a result, it is more expensive for Puerto Rico to get supplies form the US than from non-American sources because of shipping costs.Thor's Hammer , October 24, 2017 at 5:27 pm
Could NC do a post on the Jones Act?
Do we allow foreign-flagged vessels to transport goods between, say, California and Hawaii? What about Guam and the US Virgin Islands?Mark K , October 23, 2017 at 3:46 pm
We do live on a global island. Soot from Chinese coal burning lands on the few remaining glaciers in Glacier National Park and hastens their demise. Methane from melting permafrost in the Northwest Territories acts as a blanket to increase solar heating of the ocean surface. Increased ocean temperatures help hurricanes to explode from Category 1 to 5 almost overnight and stall over Houston as a Biblical deluge.
Three well-placed air-burst EMP nuclear bombs can disable communication and transport over most of the country. And a week without water and food being transported into New York would turn it into San Juan with no rescue boats on the horizon and frozen corpses piling up in the alleys in mid-winter.
We all live on an island -- one held together by a thin spider web of technology and resting upon an biosphere that we are waging war against with our insatiable imperative of growth.HotFlash , October 23, 2017 at 4:30 pm
"The political class seems to have lost the ability to mobilize on behalf of its citizens.". It wasn't always this way. Read http://northernwoodlands.org/articles/article/thirty-eight-new-england-lumber-storm .
When I read what the FDR Administration was able to accomplish amidst the devastation of New England's forests wrought by the hurricane of 1938, it brought tears to my eyes.JohnS , October 23, 2017 at 4:05 pm
"The political class seems to have lost the ability to mobilize on behalf of its citizens."
My momma used to say, "Where there's a will, there's a way." I have observed that if there's 'no way', it's because there is no will. I think this is the case in PR, as it was in NOLA, and as it seems to be in Houston (except for the *nice* neighbourhoods, of course). Cali fire victims, prepare to be On Your Own(tm).Bruce , October 24, 2017 at 1:16 pm
Great job, Lambert .insight and solid research into a topic overlooked by the MSM and the politicals .
If your interest and time permits, I would love a report on what FEMA will/has provided for LONG TERM HOUSING for PR, Northern CA, and the areas hit hard by hurricanes on the USA mainland ..
I have not been able to locate much on this topic
Last I heard was that FEMA had Zero trailers on hand and had let out a contract to some company(s) to build new trailers.
In the interim, there was a report that FEMA would be distributing TENTS to some people in need of shelter. I believe this article was a report from Florida after the fist Hurricane hit there.
A look at Puerto Rico shows that there at lots of homes without roofs ..and they are probably not accessible for a trailer delivery up in the hills. In Santa Rosa, CA, there is very little affordable and available housing close to Santa Rosa. The rains will arrive and then the Mud will Turn the Sand into YUCK and MUCK.
I remember, after Katrina and her friends beat up New Orleans, a lot of folks were flown away from New Orleans (Barbara Bush opined it was probably a good deal for a lot of 'em) and many did not return. Others were put in FEMA trailers. (TREME on HBO covered the KATRINA aftermath as only David Simon can!)
Anyone else, who can provide me with links or information, is most welcome to respond.
JohnSMel , October 23, 2017 at 4:08 pm
FEMA's mission is emergency/first response mobilization. It is not their job or within its functionality or budget to provide long-term rebuilding solutions. That falls on the island's government, with congressional financial assistance if congress allocates money for it.a different chris , October 23, 2017 at 5:29 pm
The Army Corps of Engineers are one thing, the other things are the Combat Engineers, organized perhaps as regiments and assigned to combat brigades. These are the people who do roads, airfields, etc., and the ones you would have wanted on the spot in Puerto Rico from maybe day two.rd , October 23, 2017 at 6:06 pm
I strongly believe the problem is the deployment to the Middle East. Bullies strongly believe they must never, ever show weakness. So they believe that they can't pull Combat Engineers out of Whateveristan without looking weak.
So they don't – and they bless their lucky stars that Puerto Rico isn't a state and Puerto Ricans aren't considered Americans by most Americans. However – how many of those deployed to the ME are from Puerto Rico, and how are they reacting? I gotta wonder.SerenityNow , October 23, 2017 at 7:43 pm
USGS has started mapping the landslide impacts:
To get a road open, you need to clear the trees and debris, repair bridges, and repair landslides. In rugged terrain, this is a serious effort as just one break makes the road unusable for deliveries beyond the break.Vatch , October 23, 2017 at 9:28 pm
The Bloomberg piece explains:
Puerto Rico has one of the highest rates of car ownership in the world, thanks to urban sprawl and the government's failure to build public transportation that commuters might actually use . Puerto Ricans are isolated without cars About 931,000 Puerto Ricans drive or carpool to work out of 3.4 million total residents, according to U.S. Census data. [T]he island has the fifth-highest number of vehicles per capita in the world.
The only thing I would like to mention is that people don't drive because there soley because there is no public transportation, they drive because it is the most convenient/fast/cost effective mode of travel available. You could build all the lightrail in the world, but if it wasn't more convenient/cheaper/cost effective than driving, people wouldn't take it. Disincentives for driving are much more powerful than incentives for transit.
How much road do they have per inhabitant there? Maybe disasters like these could be a wakeup call for how we lay out our development and where we spend our infrastructure dollars? Unfortunately probably not.AbateMagicThinking but Not money , October 23, 2017 at 11:40 pm
I haven't read the book or seen the movie, so maybe my comment is off base, but I'll proceed anyway. This article makes me think of the post-apocalyptic drama "The Road", by Cormac McCarthy.George Phillies , October 24, 2017 at 12:23 am
If the U.S. is not an empire, Puerto Rico would not be a protectorate or whatever. If the U.S. is an empire in decline, Puerto Rico being abandoned would be a signal to the world that the U.S. dollar is in serious trouble.
What with PR's situation and the apparent U.S. tendency to retreat from simple truths, could a collapse in preference falsification* be in progress?
From my side of the world, the U.S. is becoming more than ever a busted flush of apparent and unsustainable inconsistencies which might take us all down with it.
Here's hoping that there is a bounty of brilliant minds and and excellent administrators in the U.S. military leadership who are ready to step up.
*see Timur Kuran's 1995 work.Felix_47 , October 24, 2017 at 1:18 am
By report Puerto Rico is making a deal with a Washington (state) power company on power line repair, the issues involved in running power lines through PR and through inland Washington being rather similar. the last Saffir 3, 4, or 5 hurricanes ot hit the island did so in 1928 and 1932, or so I have read, so on one hand there is plenty of time to get a return on investment, and on the other hand, there was no rationale for building power lines that could survive a force 4 or 5 hurricane.Vatch , October 24, 2017 at 10:28 am
Puerto Rico is third world lite. They could rebuild and become a model for the third world. There are only 3 million people on the island. They dont have to pay Fed income tax. It could be a great retirement location for elderly whites. It just requires investment. Currently the single largest employer is the US govt. They need leadership from within.
Here's what the IRS says about Puerto Rico and income taxes (quoted from Wikipedia ):
In general, United States citizens and resident aliens who are bona fide residents of Puerto Rico during the entire tax year, which for most individuals is January 1 to December 31, are only required to file a U.S. federal income tax return if they have income sources outside of Puerto Rico or if they are employees of the U.S. government. Bona fide residents of Puerto Rico generally do not report income received from sources within Puerto Rico on their U.S. income tax return.
So they pay income tax, but only on income from outside Puerto Rico. Also from Wikipedia:
In 2009, Puerto Rico paid $3.742 billion into the US Treasury. Residents of Puerto Rico pay into Social Security, and are thus eligible for Social Security benefits upon retirement. However, they are excluded from the Supplemental Security Income.
The federal taxes paid by Puerto Rico residents include import/export taxes, federal commodity taxes, and others. Residents also pay federal payroll taxes, such as Social Security and Medicare taxes.
Oct 25, 2017 | www.nakedcapitalism.com
If neoliberalism is the belief that the proper role of government is to enrich the rich -- in Democratic circles they call it "wealth creation" to hide the recipients; Republicans are much more blatant -- then the " shock doctrine " is its action plan.
Click the link above for more information (or read the book ), but in essence the idea is to use any form of disaster, whether earthquake or economic/political crisis, to remake a society in the neoliberal image. To reconstruct the destroyed world, in other words, to the liking of holders of great wealth -- by privatizing everything of value held by the public (think water rights, public roads); by forcing austerity on cash-strapped governments as the price for "aid" (think loans, not grants, repaid by unwritten social insurance checks); by putting "managers," or simply loan officers, in charge of democratic decision-making.
In simple, a "shock doctrine" solution always takes this form: "Yes, we'll help you, but we now own your farm and what it produces. Also, your family must work on it for the next 50 years."
This is what happened in Chile after Pinochet and his coup murdered the democratically elected socialist Salvador Allende and took over the government. It's what's happening to Greece, victim of collusion between greedy international bankers and the corrupt Greek politicians they cultivated. And it's what happened in the U.S. during the 2008 bailout of bankers, by which government money was sent in buckets to companies like AIG so they could pay their debts in full to companies like Goldman Sachs. While millions of mortgaged homeowners crashed and burned to the ground.
The populist reaction to neoliberal "reform" is usually social revolt, often or usually ineffective, since creditors are, almost by definition, people with money, and people with money, almost by definition, control most governments. In Greece, the revolt sparked the election of an (ineffective) "socialist" government -- plus the rise of the Greek neo-Nazi party, Golden Dawn. In the U.S. the revolt still still sparks universal (and ineffective) hatred of the 2008 bank bailout -- plus the rise of the failed Sanders candidacy and the successful Trump presidency.
The form this same revolt will take in 2018 and 2020 is still to be determined.
The Shock Doctrine and Puerto Rico
The "shock doctrine" -- the stripping of wealth from the devastated by the already-way-too-wealthy -- is now being applied to Puerto Rico. Even before the hurricanes hit it, Puerto Rico was a second-class citizen relative to states of the U.S., even among its non-state territories. In contrast to Puerto Rico, for example, the American Virgin Islands were instantly much better treated when it came to relief from the Jones Act , a sign of already-established prejudice.
The reason should be obvious. In Puerto Rico , English is the primary language of less than 10% of the people, while Spanish is the dominant language of the school system and daily life. In the American Virgin Islands , English is the dominant language, and Spanish is spoken by less than 20% of the population. The fact that two-thirds of the population of the U.S. Virgin Islands is black seems to be lost on most Americans, a fact that likely benefits those inhabitants greatly in times like these.
Thus, to most Americans the citizens of Puerto Rico are conveniently (for neoliberals) easy to paint as "them," the undeserving, which changes what atrocities can be committed in the name of "aid" -- much like it did after Hurricane Katrina devastated "them"-inhabited New Orleans.
Synoia , October 24, 2017 at 6:41 amHuey Long , October 24, 2017 at 8:09 am
Puerto Rico is not Sovereign. Are its debts valid? Could they be repudiated?rd , October 24, 2017 at 10:56 am
Congress passed a law back in the 80's prohibiting PR from defaulting. Repudiation of PR debt would entail getting our current congress and prez to pass legislation to repudiate it, so in other words divine intervention ;-).Norb , October 24, 2017 at 9:28 am
The one place in the US that did get hammered by NAFTA was Puerto Rico. http://www.nytimes.com/1993/01/03/us/trade-pact-threatens-puerto-rico-s-economic-rise.html?pagewanted=all
When NAFTA was passed, Congress also stripped companies of tax benefits for having operations in Puerto Rico. In addition, the Jones Act makes shipping to and from Puerto Rico more expensive than shipping to and from Mexico. Oddly enough, many companies moved operations from Puerto Rico and Puerto Rico has been in recession/depression ever since.flora , October 24, 2017 at 10:43 am
I think Puerto Rico will be interesting to watch to see if anti neoliberal sentiment can take hold and survive. In one sense, every individual abandoned or ensnared in debt is in the same boat. Once put in a situation of debt servitude, the only recourse to extricate oneself is to become self reliant and attempt to build supporting networks. The trouble is, once those networks start to form, the traditional game plan is to bring in force and break them up.
If strong, self-supporting communities can form in PR, it will provide inspiration for communities on the mainland.
It will be also interesting to see if self-funded initiatives can make headway against the banking and financial interests.
This situation in PR is important in that it can change the focus of community building away form personal self-interest as now exists in America, and towards the common good, as it should be. The same is happening all across the mainland in economically devastated communities, but successfully blacked out in the media.
This truly is a long term endeavor, but tragically, climate change will increase the opportunities for proper action. The proper long term investment is in people and life skills. Lets roll up our sleeves.diptherio , October 24, 2017 at 11:52 am
" Once put in a situation of debt servitude, the only recourse to extricate oneself is to become self reliant and attempt to build supporting networks. "
US people born 1880 – 1900 were adults/young adults with families when the Great Depression hit. Their children, sometimes referred to as The Greatest Generation, were children or teens during the depression and saw how debt destroyed families. When those children grew up they were debt averse. The Depression/Greatest Gen's children, the Baby Boomers, would often joke their parents, who were Depression kids, could squeeze a nickel until it screamed. Boomers, having no memory of systemic economic bad times, took on large debts for school and housing on the theory their income would always increase as it had for their parents. Now the Boomers children are facing a wholly different economy, more like the Great Depression than the Booming 50's and 60's.
I expect today's younger generation will become debt averse. That would hurt the FIRE sector's reliance on ever increasing debt payment rents. Reducing the FIRE sectors influence would be good for both the Main Street economy and individuals, imo.Jim Haygood , October 24, 2017 at 9:57 am
It will be also interesting to see if self-funded initiatives can make headway against the banking and financial interests.
See my comment below. Puerto Rico already has a thriving, self-funded co-op movement, so I think they've got a better chance than most.Thor's Hammer , October 24, 2017 at 10:22 am
"What's killing the modern world is the world-wide overhang of personal debt -- not government deficits, which are entirely different."
This is an odd claim to make in an article about Puerto Rico, whose troubled debt is entirely governmental. Pie chart:
In turn, Puerto Rico's govt debt crisis led to the imposition of a crushing 11.5% sales tax, making retail prices already jacked up by the Jones Act even more unaffordable.
Puerto Rico's recovery will depend almost entirely on how much of a haircut is imposed on bondholders versus restructuring and extending in the Greek fashion, which would doom PR forevahhhh.Rakesh , October 24, 2017 at 12:18 pm
It would be interesting to compare the pace of recovery in Cuba with that of Puerto Rico. Both were hit by category 5 hurricanes within days of each other. In the case of Cuba, Havana was every much at the center of the bulls eye as San Juan Puerto Rico if I am correct. But I've not been able to uncover a single scrap of reporting that draws the comparison. Perhaps it would be embarrassing to the defenders of "free market" capitalism and social organization?
But hurricanes are last month's news. We've moved on to the startling revelations that fat pig movie directors are pussy grabbers just like our President.GlobalMisanthrope , October 24, 2017 at 1:34 pm
http://www.frontline.in/world-affairs/a-tale-of-two-islands/article9892265.eceThor's Hammer , October 24, 2017 at 6:28 pm
Thank you posting this!
I have always believed that one of the primary aims of the Cuba travel ban was to keep us Puerto Ricans from traveling there to see what isolation and poverty -- the constant threats leveled at those who support PR independence -- could look like.Jeremy Grimm , October 24, 2017 at 11:48 am
Thanks for posting this journalism from an Indian source. While it may be accurate, the writing style reads like it was copied straight from the Ideologe's Bible. So I'll file it along most commentary from outlets like the Washington Post– assume it is fraudulent propaganda until proven otherwise.diptherio , October 24, 2017 at 11:50 am
It's very nice to talk about how to rebuild Puerto Rico but how long will it be before Puerto Rico is hit by another major hurricane? And while we're thinking of Puerto Rico what about Houston, and Florida? What about the North Carolina sea coast -- or New Jersey -- NYC? I don't expect anything reasonable will be done in rebuilding any of these places or beginning an orderly retreat to higher ground.
Some parts of these areas may remain habitable -- at least long enough to make it worthwhile to build infrastructure but I believe it will be a mistake to simply "rebuild". Replacement infrastructure should be built to better withstand the future storms and rising seas. I am aware that not "rebuilding" is neither socially nor politically viable. It just seems a shame to waste what time and resources remain.Watt4Bob , October 24, 2017 at 11:58 am
I was fortunate enough to get to meet a number of Puerto Rican cooperators at this year's Assoc. of Cooperative Educators Institute in Denver. Puerto Rico has a very strong cooperative sector/movement. Co-ops in Puerto Rico don't pay tax to the gov't. Instead, each co-op provides (iirc) 2% of net revenues to Liga de Cooperativas de Puerto Rico , the apex co-op organization for the island. This provides an internally funded support mechanism for co-ops and has helped create a thriving co-op ecosystem.
So I've got some optimism that my Puerto Rican friends will be able to replace at least some of the failed systems that have been afflicting them with cooperative, sustainable, alternative solutions.
Things are moving fast, from MSN ;
Puerto Rico has agreed to pay a reported $300 million for the restoration of its power grid to a tiny utility company which is primarily financed by a private equity firm founded and run by a man who contributed large sums of money to President Trump, an investigation conducted by The Daily Beast has found.
Whitefish Energy Holdings, which had a reported staff of only two full-time employees when Hurricane Maria touched down, appears ill-equipped to handle the daunting task of restoring electricity to Puerto Rico's over 3 million residents.
As usual, donate a few thousand, reap millions.
FEC data compiled by The Daily Beast shows that Colonnetta contributed $20,000 to the "Trump Victory" PAC during the general election, $27,000 to Trump's primary election campaign (then the maximum amount permitted), $27,000 to Trump's general election campaign (also the maximum), and a total of $30,700 to the Republican National Committee in 2016 alone.
Colonnetta's wife, Kimberly, is no stranger to Republican politics either; shortly after Trump's victory she gave $33,400 to the Republican National Committee, the maximum contribution permitted for party committees in 2016.
Bears repeating, we're not only 'ruled' by whores, we're ruled by cheap whores.
Of course I make apologies to all ladies of negotiable affection.
Oct 24, 2017 | www.moonofalabama.org
Phoenix 2.0 - CIA's Vietnam Terror Unleashed Upon Afghanistan
Last week the new head of the CIA Mike Pompeo publicly threatened to make the CIA a "much more vicious agency". His first step towards that is to unleash CIA sponsored killer gangs onto the people of Afghanistan:The CIA is expanding its covert operations in Afghanistan, sending small teams of highly experienced officers and contractors alongside Afghan forces to hunt and kill Taliban militants across the country ...
The CIA's expanded role will augment missions carried out by military units, meaning more of the United States' combat role in Afghanistan will be hidden from public view
This is not going to be a counter-insurgency campaign, even when some will assert that. A counter-insurgency campaign requires political, security, economic, and informational components. It can only be successful in support of a legitimate authority.
The current Afghan government has little legitimacy. It was bribed together by the U.S. embassy after wide and open election fraud threatened to devolve into total chaos. In August CIA director Pompeo met the Afghan president Ashraf Ghani and likely discussed the new plan. But the now announced campaign has neither a political nor an economic component. A campaign solely centered on "security" will end up as a random torture and killing expedition without the necessary context and with no positive results.
The campaign will be a boon for the Taliban. While it will likely kill a some Taliban aligned insurgents here and there, it will also alienate many more Afghan people. Most of the Taliban fighters are locals. Killing them creates new local recruits for the insurgency. It will also give it better population cover for future operations.
A similar campaign during the Vietnam war was known as Operation Phoenix . Then some 50,000 South-Vietnamese, all of course 'suspected communists', were killed by the CIA's roving gangs:[Phoenix] was designed to identify and "neutralize" (via infiltration, capture, counter-terrorism, interrogation, and assassination) the infrastructure of the National Liberation Front of South Vietnam (NLF or Viet Cong). The CIA described it as "a set of programs that sought to attack and destroy the political infrastructure of the Viet Cong". The major two components of the program were Provincial Reconnaissance Units (PRUs) and regional interrogation centers. PRUs would kill or capture suspected NLF members, as well as civilians who were thought to have information on NLF activities. Many of these people were then taken to interrogation centers where many were allegedly tortured in an attempt to gain intelligence on VC activities in the area. The information extracted at the centers was then given to military commanders, who would use it to task the PRU with further capture and assassination missions.
The Phoenix program was embedded into a larger civil political and economic development program known as CORDS . The accepted historical judgement is that Phoenix failed to achieve its purpose despite its wider conceptualization. The passive support for the Viet Cong increased due to the campaign. In recent years there have been revisionists efforts by the Pentagon's RAND Corporation to change that view.
The now announced campaign looks similar to Phoenix but lacks any political component. It is not designed to pacify insurgents but to eliminate any and all resistance:The new effort will be led by small units known as counterterrorism pursuit teams. They are managed by CIA paramilitary officers from the agency's Special Activities Division and operatives from the National Directorate of Security, Afghanistan's intelligence arm , and include elite American troops from the Joint Special Operations Command. The majority of the forces, however, are Afghan militia members
There are only a few dozen officers in the CIA Special Activities Division that can support such a campaign. The lede to the article suggests that 'contractors' will have a significant role. In August the former head of the mercenary outlet Blackwater, Eric Prince, lobbied the Trump administration for a contractor led war in Afghanistan. We can safely assume that Prince and some Blackwater offspring will be involved in the new CIA campaign. The major intelligence groundwork though will have to be done by the NDS.
The Afghan National Directorate of Security was build by the CIA from elements of the former Northern Alliance, the opponents of the original Taliban. In the late 1990s the Northern Alliance under Ahmed Shah Massoud was financed by the CIA . Shah Massoud's intelligence chief Amrullah Saleh, a dual citizen, received CIA training. After the U.S. invasion of Afghanistan Saleh headed the new intelligence service, the NDS. Then President Hamid Karzai fired Saleh in 2010 when he resisted Karzai's efforts to reconcile with the Taliban. In March 2017 the current President Ashraf Ghani appointed Saleh as State Minister for Security Reforms. Saleh resigned(?) in June after Ghani reached a peace agreement with the anti-government warlord and former Taliban ally Gulbuddin Hekmatyar.
Saleh is an ethnic Tajik and an unforgiving hardliner. He is wary of Pashtun who are the most populous ethnic group in Afghanistan and the base population for the Taliban. Saleh recently founded his own political party. He obviously has further ambitions. He always had excellent relations with the CIA and especially its hardline counter-terrorism center. I find it highly likely that he was involved in the planning of this new campaign.
In the ethnically mixed north of Afghanistan the involvement of NDS led local militia will probably cause large scale ethnic cleansing. In the Pashtun south and east it will lack all local support as such militia have terrorized the country for quite some time:For years, the primary job of the CIA's paramilitary officers in the country has been training the Afghan militias. The CIA has also used members of these indigenous militias to develop informant networks and collect intelligence.
The American commandos -- part of the Pentagon's Omega program, which lends Special Operations forces to the CIA -- allow the Afghan militias to work together with conventional troops by calling in airstrikes and medical evacuations.
The units have long had a wide run of the battlefield and have been accused of indiscriminately killing Afghan civilians in raids and with airstrikes.
It is utterly predictable how this campaign will end up. The CIA itself has few, if any, independent sources in the country. It will depend on the NDS, stuffed with Saleh's Tajik kinsmen, as well as on ethnic and tribal militia. Each of these will have their own agenda. A 'security' campaign as the planned one depends on reliable intelligence. Who, in this or that hamlet, is a member of the Taliban? For lack of trusted local sources the militia, under CIA or contractor command, will resort to extremely brutal torture. They will squeeze 'informants' and 'suspects' until these come up with names of a new rounds of 'suspects'. Rinse-repeat - in the end all of the 'suspects' will be killed.
The new plan was intentionally 'leaked' to the New York Times by "two senior American officials". It is set into a positive light:[T]he mission is a tacit acknowledgment that to bring the Taliban to the negotiating table -- a key component of Mr. Trump's strategy for the country -- the United States will need to aggressively fight the insurgents
That claim is of course utter nonsense. The U.S. already has for years "aggressively fought the insurgents". The Taliban were always willing to negotiate. Their main condition for a peace agreement is that U.S. forces end their occupation and leave the country. The U.S. is simply not willing to do so. Killing more 'suspect' Taliban sympathizers will not change the Taliban's demand nor will it make serious negations more likely.
Five years from now, when the utter brutality and uselessness of the campaign will come into full light, the NYT will be shocked, SHOCKED, that such a campaign could ever have happened.
Posted by b on October 24, 2017 at 06:43 AM | Permalink
Depth Charge | Oct 24, 2017 6:45:53 AM | 1They tried this in Northern Ireland against the IRA. Didn't work.originalone | Oct 24, 2017 7:55:45 AM | 2I wonder how much of the "OPIUM" production these "killer gangs" will receive. Of course, it's too late for the top dogs to use the U.S.A. as a dumping ground, but there's still potential within the 3rd world for expansion. It's just too lucrative to lose, which would probably happen if the Taliban were to regain control of Afghanistan. Makes one wonder just who the addicted really are.V. Arnold | Oct 24, 2017 8:36:56 AM | 3I do wish I could express shock, or even surprise, at Phoenix 2.0; but it's been obvious for decades that the U.S. is an outlaw empire not beholden to any and all laws on planet earth.Oilman2 | Oct 24, 2017 8:59:01 AM | 4
They (the U.S.) now own the planet and will rule as they see fit: End of discusion...The other things this illustrates are a complete lack of creativity and adaptation by the CIA They have used the same playbook, passed down for 70 years and never changed anything but the jerseys the players wear. When a simple analysis like b has done indicates the result will not be what is desired (apparently), then maybe the CIA desires something else? Like maybe a big payoff by the mercs they contract out to?Perimetr | Oct 24, 2017 9:04:37 AM | 5
One would think that heading for the hills, bugging out, would be the strategy the Taliban adopts - because it has worked when the invaders numbers are too low, even in the face of higher tech weapons and surveillance. This will likely happen once again, and then there will be a call for "moar, moar!" to finish the 'mission'. Which has no set goal other than to be a mission to spread the money around among the players.
The Taliban goal hasn't wavered and is simple and uniformly appealing - they want the Yanks to go home. It's amazing that the same pitfall setup by the CIA entangled Russia, and then the CIA and US military walked into their own old pit. Next they still stand about, unable to concede the mission is impossible?
So this looks to me like an OP to spend money and hide it by spreading it around yet again. Very similar to Iraq, only without any spoils to spread around. Unless, of course, opium production rises again, and the protection racket baksheesh rises with it for the mercs we send.Good practice for domestic operations.Hoarsewhisperer | Oct 24, 2017 9:09:21 AM | 6The 3rd par of your commentary on the NYT text spells out the obvious flaw in this (same old) Full Spectrum Depravity scheme, b...Christian Chuba | Oct 24, 2017 9:13:38 AM | 7
"The campaign will be a boon for the Taliban. While it will likely kill a some Taliban aligned insurgents here and there, it will also alienate many more Afghan people. Most of the Taliban fighters are locals. Killing them creates new local recruits for the insurgency. It will also give it better population cover for future operations."One of the arguments for having permanent bureaucracies as opposed to political appointments is to maintain a collective memory but we are in a cycle where we keep trying failed ideas over and over again. To add insult to injury, our 'watchdog' press never calls them out on this.x | Oct 24, 2017 9:45:52 AM | 8
I know, let's use our air power to bomb ...
I know, let's have a counter-insurgency operation ...
I know, let's fund rebels in a foreign country ...
I know, let's have assassination teams ...
I know, let's have a surge ...@4 -- "They have used the same playbook, passed down for 70 years and never changed anything but the jerseys the players wear."likklemore | Oct 24, 2017 10:03:21 AM | 9
Hopefully they aren't using Monsanto's "Agent Orange" on the poppy fields this time round like they did in Vietnam and Cambodia etc -- that would really undermine the Black Budget and criminal opioid supply system.What's for dinner?Red Ryder | Oct 24, 2017 10:07:42 AM | 10
Commenter Originalone @ 2 nails it. It's all about the "OPIUM" trade.
And, they have misplaced the Memo. Afghanistan is where Empires go to die. Fast forward, as in Nam, the helicopter exits will be on the horizon.Phoenix Program killed 135,000 Vietnamese.b, that was a lot of information presented in an excellent piece of writing. As always, I admire your economy of words. Thanks for the take.
The result was the US ran for its life, in disgrace, General Giap's tanks chasing them out of his country.
As for the Taliban negotiating. Something is going on with Russia and the Taliban. So the US is determined to disrupt it as severely as possible. This will make Putin and Lavrov's job easier.
This Afghan war will end when the Taliban hoist half a dozen dead SOF up on a bridge or overpass for the flies and buzzards to feast while the photos go viral.
Then America will stand down. And only then, when it is a PR nightmare and historical iconic image. Fallujah, Somalia, etc.
The Pentagon and CIA won't care. The American citizens will be the ones shocked by the denouement. They are already being primed for AFRICOM adventures. Niger Ambush. Those damn Frenchies didn't save our boys. Those Mirages (an apt name for imperial aircraft in the deserts of N.Africa) never opened fire. 'Twasn't our fault. Blame the Frenchies.
Posted by: Grieved | Oct 24, 2017 10:34:47 AM | 11b, that was a lot of information presented in an excellent piece of writing. As always, I admire your economy of words. Thanks for the take.Laguerre | Oct 24, 2017 10:47:12 AM | 12
Posted by: Grieved | Oct 24, 2017 10:34:47 AM | 11 /divYou could have added a comparison to the Death Saquads of Central America. Same thing.RenoDino | Oct 24, 2017 11:05:54 AM | 13This is not a continuation of the Afghan war by other means. This is a colonial occupation. We now have a forward base in the Far East that borders both China and Russia that we will never abandon. Defeating the Taliban is a non-issue in the broader strategic sense. In fact, engaging the Taliban justifies the long-term occupation under the banner of defeating terrorism. Death squads are the perfect way to keep a restive population restive. Since every place on earth is a sanctuary for terrorism, every place is now deserving of American occupation, and none more so than Afghanistan. Stirring up the locals is small price to pay to distract the American people and Congress from the long term goal of maintaining a military and prison colony in the path of the Great Silk Road for at least 1,000 years. Appointing an American Viceroy to rule the colony has already been publicly discussed. With sufficient CIA success, we may achieve enough cover to allow for resource extraction to benefit our strategic stockpile without any consideration for environmental standards. Only then, will Afghanistan achieve full 19th Century colony status.Ghostship | Oct 24, 2017 11:06:33 AM | 14>>>> likklemore | Oct 24, 2017 10:03:21 AM | 9Don Bacon | Oct 24, 2017 11:17:24 AM | 15
FFS, it has absolutely nothing to do with opium.Afghanistan is where Empires go to die.
And which empires did?
British Empire? Nope.
Mongol Empire? Nope.
Russian Empire? Nope.
Qing dynasty? Nope.
Spanish Empire? Nope.
Second French colonial empire? Nope.
Abbasid Caliphate? Nope.
Umayyad Caliphate? Nope.
Yuan dynasty? Nope.
Portuguese Empire? Nope.
(Top ten empires of all time according to Wikipedia)
Looking through the entire list of fifty empires that controlled more than 2% of the earth's land surface, I couldn't identify one that had been destroyed by Afghanistan. However, Montgomery's Rules of War should be amended to include "Don't go anywhere near Afghanistan because the fly-infested shithole ain't worth anything".
It didn't even come close to defeating the Soviet Empire which wisely got out of the stalemate created by American and Saudi support of the jihadists. Americans need to get it into their pea-sized brains that the Soviet Union was not defeated in Afghanistan or anywhere else for that matter but broke up because its leaders had woken up to the fact that Bolshevism doesn't really work in the long term. Once Americans understand this, they should be capable of understanding that realising they are in a stalemate and just getting the fuck out doesn't mean that the Taliban have defeated them because any time it wants the US can go back, kick the Taliban out at minimal cost and the Taliban knows that. Anybody who knows about the First Anglo-Afghan War should understand what I'm sayingThe US has also greatly increased the aerial bombing. This will be further increased. The additional troops being dispatched will be used by the Afghan Army at battalion level to call in air strikes.linda amick | Oct 24, 2017 11:38:28 AM | 16
news report excerpt:
The second R, "realignment," will push U.S. advisors and trainers down to Afghan forces' battalions, and the third, "reinforce," means adding 3,000 or so U.S. troops to help do so, Mattis said. In recent years, U.S. advisors have been embedded only at the senior levels of the conventional Afghan military and with the Afghan special forces.
"Two levels down below is where the decisive action is taking place, and we didn't have any advisors," Dunford said. "So even though we had some aviation capabilities, some intelligence, surveillance and reconnaissance capabilities, it wasn't being delivered to those Afghan units who were perhaps most relevant to the fight."
That means more Afghan forces -- there's 300,000 all told today, both officials said -- will have U.S. troops with them capable of requesting air strikes around the country.
And the targets they'll be able to strike have expanded as well.
"At one time, sir, we could not help Afghan forces unless they were in extremis" -- that is, under direct, urgent threat, Mattis said. "And then eventually that was rescinded, but they still had to be in proximity. They had to be in contact. Today, wherever we find them, the terrorists -- anyone trying to throw the NATO plan off, trying to attack the Afghan people and the Afghan government -- then we can go after them."
President Trump has told us that the real policy change in Afghanistan is no longer to build needed infrastructure, but to destroy it. The US must destroy Afghanistan to save it. Excerpts from his August speech remarks:
> have the necessary tools and rules of engagement to make this strategy work
> I have already lifted restrictions
> we are already seeing dramatic results in the campaign to defeat ISIS, including the liberation of Mosul in Iraq. (Mosul has been completely destroyed.)
> apply swift, decisive, and overwhelming force.These american overseas missions seem to have several goals one of which is for criminal government representatives and their corporate masters to set up rat lines and pay to play schemes. Of course perpetuating "boogey man" propaganda for the american public's benefit has so far kept citizens quiet and deluded.karlof1 | Oct 24, 2017 11:45:50 AM | 17
The USG has ceased having any accountability to american citizens.
CIA further grasping at straws. Eventually, the collective action of the SCO, of which Afghanistan will eventually become a full member, will finally drive the Yanks and their NATO lackeys out of South Asia, but it won't happen anytime soon. Adam Garrie at The Duran points out the "dissonance" in the Outlaw US Empire's policy (which is directly related to the reasons for Tillerson's ineffectiveness I wrote about yesterday) and well described in this excerpt:Don Bacon | Oct 24, 2017 12:13:51 PM | 18
"Making matters all the more awkward for the US, while the US continues to attempt and fight the Taliban while treating the group as a kind of terrorist organisation, in reality, the Taliban are in fact the 'moderate rebel' which the US once spoke about in Syria, even though in Syria, moderate rebels objectively do not exist. Yet in a country, where there is a 'moderate rebellion', the US continues to take a generally hard-line approach. This attitude goes against the grain of world opinion including that of Russia, Pakistan and China who each favour military de-escalation and a peace process that, once certain conditions are met, would include the more amiable factions of the Taliban."
Garrie also delves into the CIA's heroin program and links it to its strategy to derail China's One Belt, One Road project in his conclusion. http://theduran.com/rex-tillerson-says-us-ready-work-taliban-fighting/Still lacking is sufficient rationale for why all this expensive destructive killing behavior is necessary in this landlocked illiterate tribal country on the other side of the planet. The old tired explanations didn't work sixteen years ago and they are less worthy now.nonsense factory | Oct 24, 2017 12:37:07 PM | 19
> eliminate safe haven
> disallow planning for future 9/11
Of course they can't use the real reasons:
> Prevent "losing" Afghanistan, maintenance of the empire
> Set the example for other countries thinking of slipping the reins (or US reign)The only long-term interest the US has in Afghanistan is the TAPI pipeline route. Gotta get those stranded Central Asia oil & gas assets to global markets without going through Russian or Iranian pipeline routes. Chevron & Exxon just dumped another $37 billion into the Tengiz. And they're still flogging TAPI:ben | Oct 24, 2017 12:40:10 PM | 20
(2013) In a major development, the four countries that are part of the Turkmenistan, Afghanistan, Pakistan and India (TAPI) gas pipeline project have selected two US-based energy giants for financing and operating the multi-billion-dollar pipeline.
. . . transnational-project-chevron-exxonmobil-keen-on-running-tapi-pipeline/
So the CIA has been tasked with making this possible. So they'll let one group of ethnic warlords run all the criminal drug rackets they like, in exchange for their cooperation with CIA and contractors, as in Laos with the Hmong and the opium cartel in Southeast Asia.
It's a broken record and has been for decades. First it was buy off the Taliban, open TAPI. Then it was defeat the Taliban, open TAPI. This is just another tired repeat of the same stupid imperial pet tricks. If you look back at the past decade in Afghanistan, it's obvious that every single U.S. military action has been focused on controlling the TAPI route - and this is obvious to the Afghan people, too. So they'll keep blowing up any pipeline effort. And Exxon and Chevron and the CIA and US military will keep trying to push it through.No great mystery here:james | Oct 24, 2017 1:00:27 PM | 21
b said:"The campaign will be a boon for the Taliban."
Absolutely true. Historical context proves this over and over again, but, the corporate empire will have their resources, no matter the cost in blood and treasure.
Ghostship @ 14: good post, nothing like reality to sober up thought.
Until the reserve currency problem is solved by the world, this BS will continue..thanks b..likklemore | Oct 24, 2017 1:32:28 PM | 22
what is the reason the usa is in afganistan?
3 choices - could be 1, 2 or all 3..
feeding the war machine.
regardless of the reason - none of them are valid reasons on the world stage and everyone knows this, including the contractors, corporations and profiteers off any or all of it..
the usa is a rogue nation that got taken over some time ago.. that much is obvious.. when will other countries step up and put a stop to this madness?Ghostship | Oct 24, 2017 11:06:33 AM | 14 wroteRed Ryder | Oct 24, 2017 1:49:39 PM | 23
FFS, it has absolutely nothing to do with opium.
FFS Ghostship. You are the one sporting Bollocks.. Ask the boys who manage the processing labs; load the coffins and the routing of said coffins. They are not ghosts but carriers, like pigeons. Pentagon vs. see aye a.
No? Why is production up since the "occupation"
At the start of the US Afghani war, NYT's cartoon posted the list of empires defeated in Afghanistan. You may remain in denial, revising history. It's your choice. Some of us are closer to the facts on the ground - first hand accounts.
A little background for starters: - also check out the Guardian and WSJ on subject.
Cruel Harvest in the gardens of Empire: Afghanistan, Garden of Empire: America's Multibillion Dollar Opium Harvest
Afghanistan: The Making of a Narco State
Also, within the R S link above, read the related article written Feb 10, 2012 by Michael Hastings' "The Afghanistan Report the Pentagon Doesn't Want You to Read" – that Michael Hastings whose Benz, with Michael at the wheel, had a fiery end in a single vehicle accident on June 18, 2013.
Why Afghanistan?Virgile | Oct 24, 2017 1:58:01 PM | 24
China, Central Asia stans, Russia.
It is the perfect platform to use against all those nations.
As long as they can fly in what they need to supply their proxies and the small numbers of special forces and some CIA guys, it works like a massive aircraft carrier.
The other thing is the trillions in minerals. Not so much to rape and take, but to deny them to China.
This is part of containment and strangulation of China and destabilization of CSTO/SCO nations.The USA is out of tricks on Afghanistan. It now thinks that a CIA covert operations will be less deadly on US military.b | Oct 24, 2017 2:18:04 PM | 25
Pompeo has been pressed by Trump to find something that would make the Taliban small.
History shows that CIA intervention blows back years after in a worse situation.
Neither Trump nor Pompeo will be there to feel the blow back...Video: The Vietnam War and the Phoenix Program: "A Computerized Genocide" - Michael Maclear's 1975 documentary, Spooks and Cowboys, Gooks and Grunts (Part 1)PavewayIV | Oct 24, 2017 2:19:14 PM | 26Ghostship@14 - The costs of Iraq/Afghanistan are now estimated to be about $4.7 trillion in constant dollars. Most of that was on credit - we created IOU's and sold them to the highest bidder. Those $4.7 trillion of IOUs also have interest that will total $7.9 trillion (if rates remain low), and that's just from IOUs created up until 2013 and payable through 2053. None of the Syria/Iraq anti-ISIS operations after 2013 nor the cost of Afghanistan since 2013 have been counted in those numbers.ben | Oct 24, 2017 2:36:39 PM | 27
Unmanageable future national debt use to be controlled in the US by inflating it away. The Fed no longer has the power to do that anymore, and US inflation will just drive more US businesses and jobs out of the country. We might actually be the first empire to fall because of (at least in part) Afghanistan.James @ 21 said:"3 choices - could be 1, 2 or all 3.."Daniel | Oct 24, 2017 3:05:24 PM | 28
feeding the war machine.
No doubt, there there are a myriad of reasons, all involve they making of profits. And that, is why some people refer to this current empire as a corporate driven one. But then, weren't they all?I very strongly recommend that everyone read Douglas Valentine's newest book, "The CIA as Organized Crime: How Illegal Operations Corrupt America and the World." More than fulfilling its ambitious title, this book documents how the goals and tactics of Phoenix have been deployed in the US, and also makes clear the foundational funding of CIA from narcotics.karlof1 | Oct 24, 2017 3:12:17 PM | 29
It builds on his excellent 2014 book, "The Phoenix Program: America's Use of Terror in Vietnam" in which he documents Phoenix through the eyes of the CIA, military and private contractors who designed and implemented it. He won the trust of former CIA Director William Colby, who gave him access to - and the trust of - these terrorists. So they not only admitted, but bragged about the program that became the blueprint for the modernization of COINTELPRO we see today.I Heartily second Daniel's recommendation @28. Along with Prouty's The Secret Team , most definitely required reading.Peter AU 1 | Oct 24, 2017 3:27:12 PM | 30Paveway 26Debsisdead | Oct 24, 2017 3:42:47 PM | 31
I suspect Syria is the trigger for the fall of the US empire. Russia's entry into Syria opened many peoples eyes, and countries, to what the US is about. Now, US actions in Afghanistan, Iraq, and anywhere else will be veiwed with Syria in mind.
Difficult to agree with much that is being said, no one really knows the exact numbers of vietnamese murdered by amerika during operation phoenix but it was many tens of thousands of citizens and neither them, their families, nor Vietnamese people as whole regarded this sociopathic slaughter as some minor or peripheral easily dismissed event.ashley albanese | Oct 24, 2017 3:44:25 PM | 32
I think I've already posted here about meeting, getting to know and narrowly avoiding getting into a business relationship with an operation Phoenix 'manager' in Asia about a decade after the amerikan defeat. This guy was one of the crummiest blokes I have ever met. He had a big coke habit at a time when coke wasn't readily available in the country he was deployed into. In addition to using coke pretty much continuously (AFAIK by way of amerikan diplomatic pouches) the guy was a bully who regularly used intelligence he accessed via his station, to bully the local police if they had the gall to try and protect the local children from his raping. Although mostly this was done by remote control via CIA connections with the national police who regarded local cops as little more than parking wardens - they actually performed the most vital role in law enforcement one that amerikan policing methods appear to have long despised - that is as a community based service trying to protect people within their local community but that's another story.
How did I learn all this? From the arsehole's alcohol fuelled, coke crazed tirades that is how.
I was fairly unsurprised by it as what I heard just confirmed what I had already concluded about Operation Phoenix which up until that time was the subject of hushed horror stories, but unfortunately my business partner back then had bought into that 1980's greed is good nonsense and it took entirely too much work to persuade him to get as far away from the deal as poss - to just gtfo out until the arsehole came unstuck. That happened not long after but there was no great sense of schadenfreude cos he was just moved to another station still in South East Asia.
Anyway the point I wanted to make was that altho it is unlikely that cia bosses can be blind to boozing & snorting any more, the game remains the same, so they will be using contemporaneously acceptable sociopaths, as always.
The result will be devastating for afghans. As former State Department official Matthew Hoh puts it:"Iraq's campaign in the Euphrates and Tigris River valleys, the Kurdish campaign in western Syria and the Saudi and UAE campaign against the Houtis in Yemen have been devastating and vicious assaults on populations, critical infrastructure and housing, that coupled with nighttime commando raids that terrorize entire villages and neighborhoods, look not to bring a political settlement, reconciliation or peace, but rather subjugate, along ethnic and sectarian lines, entire population groups to achieve American political desires in the Muslim world.
This CIA program of using Afghan militias to conduct commando raids, the vast majority of which will be used against civilians despite what the CIA states, falls in line with American plans to escalate the use of air and artillery strikes against the Afghan people in Taliban-held areas, almost all of whom are Pashtuns.
Again, the purpose of this campaign is not to achieve a political settlement or reconciliation, but to brutally subjugate and punish the people, mostly rural Pashtuns, who support the Taliban and will not give in to the corrupt American run government in Kabul."Peter Au 30dh | Oct 24, 2017 4:01:50 PM | 33
As I have said previously here - the failure of English policy in South Africa in 1899 showed the myth of the British Empire and contributed to the emboldenment of 'a rising ' Germany, challenging England for 'market' share in 1914 . It is ironic , in the light of present events that the 1890's U S secret service warned England not to try military solutions against Paul Kruger at the horn of Africa .
I am sure the US / Anglo interests were warned in similar historical terms at this bloody juncture in the Middle East .@31 Not saying your Phoenix guy wasn't the real thing but I've spent quite a bit of time in SE Asia and Central America, some of it in bars. Just about every American I met was some kind of CIA agent either active or retired. The Brits tended to be mostly ex-SAS.Laguerre | Oct 24, 2017 4:15:01 PM | 34Frankly, we're in the last days of the US occupation of Afghanistan. There's nowhere for them to go now, to improve their position. They're just waiting for the next Taliban attack. Sooner or later one will succeed.john | Oct 24, 2017 4:17:12 PM | 35a rogue and grueling empire in slash-and-burn mode, given to spite.Ghostship | Oct 24, 2017 4:32:37 PM | 36>>>> likklemore | Oct 24, 2017 1:32:28 PM | 22uncle tungsten | Oct 24, 2017 4:40:05 PM | 37No? Why is production up since the "occupation"
Because the Taliban decided to suppress production and when the Taliban were kicked out the Afghan farmers needed to make an income so they went back to doing what they did best, growing opium poppies and paying off the American-backed warlords. Then the Taliban decided they needed a source of income so they moved into the opium trade to raise about 60% of their income. BTW, in the early days of the British occupation of Helmand Province, the price of wheat was higher than heroin in Afghanistan and many of the farmers asked for help to convert to growing wheat which never happened because American farmers wouldn't allow it.At the start of the US Afghani war, NYT's cartoon posted the list of empires defeated in Afghanistan. You may remain in denial, revising history. It's your choice. Some of us are closer to the facts on the ground - first hand accounts.
A cartoon??????? Perhaps you could provide a link to back up your claim, but I expect one from 1979 when the United States started the American War in Afghanistan before the Soviet Union intervened in defense of modernity over medieval headchoppers aka KSA? Or perhaps you can name the empires brought low by Afghanistan but don't bother naming the British Empire.
As for the rest, I quite agree that Afghanistan is a narco-state but the trade is not controlled by the CIA, the Pentagon , the so-called American Deep State or even the Rothschilds . At most, the CIA and Pentagon turn a blind eye to its operation, and HSBC probably launder some of the money
>>>> PavewayIV | Oct 24, 2017 2:19:14 PM | 26We might actually be the first empire to fall because of (at least in part) Afghanistan.
You could very well be right but I really hope it happens peacefully.
Anyway off to get my weekly dose of opium provided by the state to calm me down a bit.Afghanistan is another backyard to Iran. From Kabul, head west and slaughter lots of shia up to the border of Iran. That's what Israel has requested and that's what the Yankees will do. On the side they will grossly enrich the military industrial complex and all will be well in the world.dh | Oct 24, 2017 4:50:45 PM | 38
The kurdistan game has been foiled and the Iraq government will not play ball on the mindless Israeli hatred for shia and passion for divisive politics. So lets try Afghanistan.
Watch out Herat.@33 I forgot to mention....you can usually tell the real ones from their collection of dried Gook ears. They like to keep a couple in their pockets for show and tell.fastfreddy | Oct 24, 2017 4:54:14 PM | 39www.thenation.com/article/bushs-faustian-deal-talibanJen | Oct 24, 2017 5:29:08 PM | 40
Published May 22, 2001. ...gift of $43 million to the Taliban rulers of Afghanistan, the gift, announced last Thursday by Secretary of State Colin Powell, in addition to other recent aid, makes the United States the main sponsor of the Taliban...On reading B's excellent post, I found myself thinking Israel has similar assassination units operating under the name Sayeret Matkal. No doubt those Israeli units would only be too happy to give training and other support to the CIA's covert program of assassination units attached to Afghan forces.Don Bacon | Oct 24, 2017 5:37:20 PM | 41
How much respect and loyalty the Afghan government will have left among its people when the CIA starts its program of police state terror in earnest is another question.There are two US initiatives to counter China's One Belt, One Road (OBOR) strategy which is budgeted at about a trillion dollars, and way out of anything the US could afford. So the US has come up with these two plans, neither one showing any promise except as a reason to continue with the AfPak war. SecState Tillerson is the point man on these initiatives. They both include a new initiative to work closely with India, and one of them requires ownership of Afghanistan.
The US has revived two major infrastructure projects in South and Southeast Asia in which India would be a vital player, the 'New Silk Road" initiative and the Indo-Pacific Economic Corridor linking South and Southeast Asia. The US New Silk Road Strategy is based upon the Silk Road Strategy Acts of 1999 and 2006. What port(s) would be used to get to Afghanistan at the doorstep of the -Stans? The US Silk Road products would have to come through the Iran port of Chabahar. That would be off limits to the US. India is supposed to be doing some development there, but it's slow. India has built a highway from Chabahar to Afghanistan. The nearby Pakistan port of Gwadar is now being developed by China and so is also off limits to the US. The US has put a major diplomatic and economic effort into the -Stans, including using USAID funds to train the locals to take over US jobs in conjunction with US companies in the International Chamber of Commerce, an offshoot of the US Chamber.
The second initiative is the Indo-Pacific Economic Corridor, still at a very nascent stage. It would focus on the "economic corridors between South and Southeast Asia" which implies working with India and against China. The US naval challenges in the South China Sea are probably one example. Tillerson has talked about challenging Chinese financing -- good luck on that. Tillerson: "It is important that those emerging democracies and economies (in Asa-Pacific) have alternative means of developing both the infrastructure they need but also developing the economies. We have watched the activities and actions of others in the region . . .It is important that those emerging democracies and economies (in Asa-Pacific) have alternative means of developing both the infrastructure they need but also developing the economies. We have watched the activities and actions of others in the region" . . here
Finally, the inclusion of India in Afghan affairs is what drives Pakistan to oppose the US strategy. It hasn't matter that the US has given Pakistan billions of dollars, Pakistan still sponsors the Taliban fighters who kill US troops. The current US destruction of Afghanistan and its people is not a choice of Pakistan, but it's less important to Pakistan than having an Indian presence on both flanks. Pakistan does not want to become an Indian sandwich. The two countries are arch-enemies.
Oct 20, 2017 | www.counterpunch.orgSocialism a century ago seemed to be the wave of the future. There were various schools of socialism, but the common ideal was to guarantee support for basic needs, and for state ownership to free society from landlords, predatory banking and monopolies. In the West these hopes are now much further away than they seemed in 1917. Land and natural resources, basic infrastructure monopolies, health care and pensions have been increasingly privatized and financialized.
Instead of Germany and other advanced industrial nations leading the way as expected, Russia's October 1917 Revolution made the greatest leap. But the failures of Stalinism became an argument against Marxism – guilt-by-association with Soviet bureaucracy. European parties calling themselves socialist or "labour" since the 1980s have supported neoliberal policies that are the opposite of socialist policy. Russia itself has chosen neoliberalism.
Few socialist parties or theorists have dealt with the rise of the Finance, Insurance and Real Estate (FIRE) sector that now accounts for most increase in wealth. Instead of evolving into socialism, Western capitalism is being overcome by predatory finance and rent extraction imposing debt deflation and austerity on industry as well as on labor.
Failure of Western economies to recover from the 2008 crisis is leading to a revival of Marxist advocacy. The alternative to socialist reform is stagnation and a relapse into neofeudal financial and monopoly privileges.
Socialism flowered in the 19 th century as a program to reform capitalism by raising labor's status and living standards, with a widening range of public services and subsidies to make economies more efficient. Reformers hoped to promote this evolution by extending voting rights to the working population at large.
Ricardo's discussion of land rent led early industrial capitalists to oppose Europe's hereditary landlord class. But despite democratic political reform, the world has un-taxed land rent and is still grappling with the problem of how to keep housing affordable instead of siphoning off rent to a landlord class – more recently transmuted into mortgage interest paid to banks by owners who pledge the rental value for loans. Most bank lending today is for real estate mortgages. The effect is to bid up land prices toward the point where the entire rental value is paid as interest. This threatens to be a problem for socialist China as well as for capitalist economies.
Landlords, banks and the cost of living
The classical economists sought to make their nations more competitive by keeping down the price of labor so as to undersell competitors. The main cost of living was food; today it is housing. Housing and food prices are determined not by the material costs of production, but by land rent – the rising market price for land.
In the era of the French Physiocrats, Adam Smith, David Ricardo and John Stuart Mill, this land rent accrued to Europe's hereditary landlord class. Today, the land's rent is paid mainly to bankers – because families need credit to buy a home. Or, if they rent, their landlords use the property rent to pay interest to the banks.
The land issue was central to Russia's October Revolution, as it was for European politics. But the discussion of land rent and taxation has lost much of the clarity (and passion) that guided the 19 th century when it dominated classical political economy, liberal reform, and indeed most early socialist politics.
In 1909/10 Britain experienced a constitutional crisis when the democratically elected House of Commons passed a land tax, only to be overridden by the House of Lords, governed by the old aristocracy. The ensuing political crisis was settled by a rule that the Lords never again could overrule a revenue bill passed by the House of Commons. But that was Britain's last real opportunity to tax away the economic rents of landlords and natural resource owners. The liberal drive to tax the land faltered, and never again would gain serious chance of passage.
The democratization of home ownership during the 20 th century led middle-class voters to oppose property taxes – including taxes on commercial sites and natural resources. Tax policy in general has become pro- rentier and anti-labor – the regressive opposite of 19 th -century liberalism as developed by "Ricardian socialists" such as John Stuart Mill and Henry George. Today's economic individualism has lost the early class consciousness that sought to tax economic rent and socialize banking.
The United States enacted an income tax in 1913, falling mainly on rentier income, not on the working population. Capital gains (the main source of rising wealth today) were taxed at the same rate as other income. But the vested interests campaigned to reverse this spirit, slashing capital gains taxes and making tax policy much more regressive. The result is that today, most wealth is not gained by capital investment for profits. Instead, asset-price gains have been financed by a debt-leveraged inflation of real estate, stock and bond prices.
Many middle-class families owe most of their net worth to rising prices for their homes. But by far the lion's share of the real estate and stock market gains have accrued to just One Percent of the population. And while bank credit has enabled buyers to bid up housing prices, the price has been to siphon off more and more of labor's income to pay mortgage loans or rents. As a result, finance today is what is has been throughout history: the main force polarizing economies between debtors and creditors.
Global oil and mining companies created flags of convenience to make themselves tax-exempt, by pretending to make all their production and distribution profits in tax-free trans-shipping havens such as Liberia and Panama (which use U.S. dollars instead of being real countries with their own currency and tax systems).
The fact that absentee-owned real estate and natural resource extraction are practically free of income taxation shows that democratic political reform has not been a sufficient guarantee of socialist success. Tax rules and public regulation have been captured by the rentiers , dashing the hopes of 19 th -century classical reformers that progressive tax policy would produce the same effect as direct public ownership of the means of production, while leaving "the market" as an individualistic alternative to government regulation or planning.
In practice, planning and resource allocation has passed to the banking and financial sector. Many observers hoped that this would evolve into state planning, or at least work in conjunction with it as in Germany. But liberal "Ricardian socialist" failed, as did German-style "state socialism" publicly financing transportation and other basic infrastructure, pensions and similar "external" costs of living and doing business that industrial employers otherwise would have to bear. Attempts at "half-way" socialism via tax and regulatory policy against monopolies and banking have faltered repeatedly. As long as major economic or political choke points are left in private hands, they will serve s springboards to subvert real reform policies. That is why Marxist policy went beyond these would-be socialist reforms.
To Marx, the historical task of capitalism was to prepare the way for socializing the means of production by clearing away feudalism's legacy: a hereditary landlord class, predatory banking, and the monopolies that financial interests had pried away from governments. The path of least resistance was to start by socializing land and basic infrastructure. This drive to free society from economic overhead in the form of hereditary privilege and unearned income by the "idle rich" was a step toward socialist management, by minimizing rentier costs (" faux frais of production").
Proto-socialist reform in the leading industrial nations
Marx was by no means alone in expecting a widening range of economic activity to be shifted away from the market to the public sector. State socialism (basically, state-sponsored capitalism) subsidized pensions and public health, education and other basic needs so as to save industrial enterprise from having to bear these charges.
In the United States, Simon Patten – the first economics professor at the new Wharton business school at the University of Pennsylvania – defined public infrastructure as a "fourth factor of production" alongside labor, capital and land. The aim of public investment was not to make a profit, but to lower the cost of living and doing business so as to minimize industry's wage and infrastructure bill. Public health, pensions, roads and other transportation, education, research and development were subsidized or provided freely. 
The most advanced industrial economies seemed to be evolving toward some kind of socialism. Marx shared a Progressive Era optimism that expected industrial capitalism to evolve in the most logical way, by freeing economies from the landlordship and predatory banking inherited from Europe's feudal era. That was above all the classical reform program of Adam Smith, John Stuart Mill and the intellectual mainstream.
But the aftermath of World War I saw the vested interests mount a Counter-Enlightenment. Banking throughout the Western world find its major market in real estate mortgage lending, natural resource extraction and monopolies – the Anglo-American model, not that of German industrial banking that had seemed to be capitalism's financial future in the late 19 th century.
Since 1980 the Western nations have reversed early optimistic hopes to reform market economies. Instead of the classical dream of taxing away the land rent that had supported Europe's hereditary landed aristocracies, commercial real estate has been made virtually exempt from income taxation. Absentee owners avoid tax by a combination of tax-deductibility for interest payments (as if it is a necessary business expense) and fictitious over-depreciation tax credits that pretend that buildings and properties are losing value even when market prices for their land are soaring.
These tax breaks have made real estate the largest bank customers. The effect has been to financialize property rents into interest payments. Likewise in the industrial sphere, regulatory capture by lobbyists for the major monopolies has disabled public attempts to keep prices in line with the cost of production and prevent fraud by breaking up or regulating monopolies. These too have become major bank clients.
The beginning and end of Russian socialism
Most Marxists expected socialism to emerge first in Germany as the most advanced capitalist economy. After its October 1917 Revolution, Russia seemed to jump ahead, the first nation to free itself from rent and interest charges inherited from feudalism. By taking land, industry and finance into state control, Soviet Russia's October Revolution created an economy without private landlords and bankers. Russian urban planning did not take account of the natural rent-of-location, nor did it charge for the use of money created by the state bank. The state bank created money and credit, so there was no need to rely on a wealthy financial class. And as property owner, the state did not seek to charge land rent or monopoly rent.
By freeing society from the post-feudal rentier class of landlords, bankers and predatory finance, the Soviet regime was much more than a bourgeois revolution. The Revolution's early leaders sought to free wage labor from exploitation by taking industry into the public domain. State companies provided labor with free lunches, education, sports and leisure activity, and modest housing.
Agricultural land tenure was a problem. Given its centralized marketing role, the state could have reallocated land to build up a rural peasantry and helped it invest in modernization. The state could have manipulated crop prices to siphon off agricultural gains, much like Cargill does in the United States. Instead, Stalin's collectivization program waged a war against the kulaks. This political shock led to famine. It was a steep price to pay for avoiding rent was paid to a landlord class or peasantry.
Marx had said nothing about the military dimension of the transition from progressive industrial capitalism to socialism. But Russia's Revolution – like that of China three decades later – showed that the attempt to create a socialist economy had a military dimension that absorbed the lion's share of the economic surplus. Military aggression by a half dozen leading capitalist nations seeking to overthrow the Bolshevik government obliged Russia to adopt War Communism. For over half a century the Soviet Union devoted most of capital to military investment, not provide sufficient housing or consumer goods for its population beyond spreading literacy, education and public health.
Despite this military overhead, the fact that the Soviet Union was free of a rentier class of financiers and absentee landlords should have made the Soviet Union the world's most competitive low-cost economy in theory. In 1945 the United States certainly feared the efficiency of socialist planning. Its diplomats opposed Soviet membership on the ground that state enterprise and pricing would enable such economies to undersell capitalist countries.  So socialist countries were kept out of the IMF, World Bank and the planned World Trade Organization, explicitly on the ground that they were free of land rent, natural resource rent, monopoly rent and financial charges.
Capitalist economies are now privatizing and financializing their basic needs and infrastructure. Every activity is being forced into "the market," at prices that need to cover not only the technological costs of production but also interest, ancillary financial fees and pension set-asides. The cost of living and doing business is further privatized as financial interests pry roads, health care, water, communications and other public utilities away from the public sector, while driving housing and commercial real estate deeply into debt.
The Cold War has shown that capitalist countries plan to continue fighting socialist economies, forcing them to militarize in self-defense. The resulting oppressive military overhead is then blamed on socialist bureaucracy and inefficiency.
The collapse of Russian Stalinism
Russia's Revolution ended after 74 years, leaving the Soviet Union so dispirited that it ended in collapse. The contrast between the low living standards of Russian consumers and what seemed to be Western success became increasingly pronounced. In contrast to China's housing construction policy, the Soviet regime insisted that families double up. Clothing and other consumer goods had only drab designs, needlessly suppressing variety. To cap matters, public opposition to Russia's military personnel losses in Afghanistan caused popular resentment.
When the Soviet Union dissolved itself in 1991, its leaders took neoliberal advice from its major adversary, the United States, in hope that this would set it on a capitalist road to prosperity. But turning its economies into viable industrial powers was the last thing U.S. advisors wanted to teach Russia.  Their aim was to turn it and its former satellites into raw-materials colonies of Wall Street, the City of London and Frankfurt – victims of capitalism, not rival producers.
Russia has gone to the furthest anti-socialist extreme by adopting a flat tax that fails to distinguish wages and profits of labor and capital from unearned rental income. By also having to pay a value-added tax (VAT) on consumer goods (with no tax on trading in financial assets), labor is taxed much higher than the wealthy.
Most Western "wealth creation" is achieved by debt-leveraged price increases for real estate, stocks and bonds, and by privatizing the public domain. The latter process has gained momentum since the early 1980s in Margaret Thatcher's Britain and Ronald Reagan's America, followed by Third World countries acting under World Bank tutelage. The pretense is that privatization will maximize technological efficiency and prosperity for the economy as a whole.
Following this advice, Russian leaders agreed that the major sources of economic rent – natural resource wealth, real estate and state companies – should be transferred to private owners (often to themselves and associated insiders). The "magic of the marketplace" was supposed to lead the new owners to make the economy more efficient as a byproduct of making money in the quickest way possible.
Each Russian worker got a "voucher" worth about $25. Most were sold off simply to obtain money to buy food and other needs as many companies stopped paying wages. Russia had wiped out domestic savings with hyperinflation after 1991.
It should not be surprising that banks became the economy's main control centers, as in the West's bubble economies. Instead of the promised prosperity, a new class of billionaires was endowed, headed by the notorious Seven Bankers who appropriated the formerly state-owned oil and gas, nickel and platinum, electricity and aluminum production, as well as real estate, electric utilities and other public enterprises. It was the largest giveaway in modern history. The Soviet nomenklatura became the new lords in outright seizure that Marx would have characterized as "primitive accumulation."
The American advisors knew the obvious: Russian savings had been wiped out by the polst-1991 hyperinflation, so the new owners could only cash out by selling shares to Western buyers. The kleptocrats cashed out as expected, by dumping their shares to foreign investors so quickly at such giveaway prices that Russia's stock market became the world's top performer for Western investors in 1994-96.
The Russian oligarchs kept most of their sales proceeds abroad in British and other banks, beyond the reach of Russian authorities to recapture. Much was spent on London real estate, sports teams and luxury estates in the world's flight-capital havens. Almost none was invested in Russian industry. Wage arrears often mounted up half a year behind. Living standards shrank, along with the population as birth rates plunged throughout the former Soviet economies. Skilled labor emigrated.
The basic neoliberal idea of prosperity is financial gain based on turning rent extraction into a flow of interest payments by buyers-on-credit. This policy favors financial engineering over industrial investment, reversing the Progressive Era's industrial capitalism that Marx anticipated would be a transition stage leading to socialism. Russia adopted the West's anti-socialist rollback toward neofeudalism.
Russian officials failed to understand the State Theory of money that is the basis of Modern Monetary Theory: States can create their own money, giving it value by accepting it in payment of taxes. The Soviet government financed its economy for seventy years without any need to back the ruble with foreign exchange. But Russia's central bank was persuaded that "sound money" required it to back its domestic ruble currency with U.S. Treasury bonds in order to prevent inflation. Russian leaders did not realize that dollars or other foreign currencies were only needed to finance balance-of-payments deficits, not domestic spending except as this money was spent on imports.
Russia joined the dollar standard. Buying Treasury bonds meant lending to the U.S. Government. The central bank bought U.S. Treasury securities to back its domestic currency. These purchases helped finance Cold War escalation in countries around Russia. Russia paid 100% annual interest in the mid-1990s, creating a bonanza for U.S. investors. On balance, this neoliberal policy lay Russia's economy open to looting by financial institutions seeking natural resource rent, land rent and monopoly rent for themselves. Instead of targeting such rents, Russia imposed taxes mainly on labor via a regressive flat tax – too right wing to be adopted even in the United States!
When the Soviet Union dissolved itself, its officials showed no apprehension of how quickly their economies would be de-industrialized as a result of accepting U.S. advice to privatize state enterprises, natural resources and basic infrastructure. Whatever knowledge of Marx's analysis of capitalism had existed (perhaps in Nicolai Bukharin's time) was long gone. It is as if no Russian official had read Volumes II and III of Marx's Capital (or Theories of Surplus Value ) where he reviewed the laws of economic rent and interest-bearing debt.
The inability of Russia, the Baltics and other post-Soviet countries to understand the FIRE sector and its financial dynamics provides an object lesson for other countries as to what to avoid. Reversing the principles of Russia's October 1917 Revolution, the post-Soviet kleptocracy was akin to the feudal epoch's "primitive accumulation" of the land and commons. They adopted the neoliberal business plan: to establish monopolies, first and most easily by privatizing the public infrastructure that had been built up, extracting economic rents and them paying out the resulting as interest and dividends.
This Western financial advice became a textbook example of how not to organize an economy.  Having rejoined the global economy free of debt in 1991, Russia's population, companies and government quickly ran up debts as a result of its man-made disaster. Families could have been given their homes freely, just as corporate managers were given their entire companies virtually for free. But Russian managers were as anti-labor as they were greedy to grab their own assets from the public domain. Soaring housing prices quickly plagued Russian's economy with one of the world's highest-priced living and business costs. That prevented any thought of industrial competitiveness with the United States or Europe. What passed for Soviet Marxism lacked an understanding of how economic rents and the ensuing high labor costs affected international prices, or how debt service and capital flight affected the currency's exchange rate.
Adversaries of socialism pronounced Marxist theory dead, as if the Soviet dissolution meant the end of Marxism. But today, less than three decades later, the leading Western economies are themselves succumbing to an overgrowth of debt and shrinking prosperity. Russia failed to recognize that just as its own economy was expiring, so was the West's. Industrial capitalism is succumbing to a predatory finance capitalism that is leaving Western economies debt-ridden.  The underlying causes were clear already a century ago: unchecked financial rentiers , absentee ownership and monopolies.
The post-Soviet collapse in the 1990s was not a failure of Marxism, but of the anti-socialist ideology that is plunging Western economies under domination by the Finance, Insurance and Real Estate (FIRE) sector's symbiosis of the three forms of rent extraction: land and natural resource rent, monopoly rent, and interest (financial rent). This is precisely the fate from which 19 th -century socialism, Marxism and even state capitalism sought to save the industrial economies.
A silver lining to the Soviet "final" stage has been to free Marxist analysis from Russian Marxology. Its focus of Soviet Marxology was not an analysis of how the capitalist nations were becoming financialized neo- rentier economies, but was mainly propagandistic, ossifying into a stereotyped identity politics appealing to labor and oppressed minorities. Today's revival of Marxist scholarship has begun to show how the U.S.-centered global economy is entering a period of chronic austerity, debt deflation, and polarization between creditors and debtors.
Financialization and privatization are submerging capitalism in debt deflation
By 1991, when the Soviet Union's leaders decided to take the "Western" path, the Western economies themselves were reaching a terminus. Appearances were saved by a wave of unproductive credit and debt creation to sustain the bubble economy that finally crashed in 2008.
The pitfalls of this financial dynamic were not apparent in the early years after World War II, largely because economies emerged with their private sectors free of debt. The ensuing boom endowed the middle class in the United States and other countries, but was debt financed, first for home ownership and commercial real estate, then by consumer credit to purchase of automobiles and appliances, and finally by credit-card debt just to meet living expenses.
The same debt overgrowth occurred in the industrial sector, where bank and bondholder credit since the 1980s has been increasingly for corporate takeovers and raiding, stock buybacks and even to pay dividends. Industry has become a vehicle for financial engineering to increase stock prices and strip assets, not to increase the means of production. The result is that capitalism has fallen prey to resurgent rentier interests instead of liberating economies from absentee landlords, predatory banking and monopolies. Banks and bondholders have found their most lucrative market not in the manufacturing sector but in real estate and natural resource extraction.
These vested interests have translated their takings into the political power to shed taxes and dismantle regulations on wealth. The resulting political Counter-Reformation has inverted the idea of "free market" to mean an economy free for rent extractors, not free from landlords, monopolists and financial exploitation as Adam Smith, John Stuart Mill and other classical economists had envisioned. The word "reform" as used by today's neoliberal media means undoing Progressive Era reforms, dismantling public regulation and government power – except for control by finance and its allied vested interests.
All this is the opposite of socialism, which has now sunk to its nadir through the Western World. The past four decades have seen most of the European and North American parties calling themselves "socialist" make an about-face to follow Tony Blair's New Labour, the French socialists-in-name and the Clinton's New Democrats. They support privatization, financialization and a shift away from progressive taxation to a value-added tax (VAT) falling on consumers, not on finance or real estate.
China's socialist diplomacy in today's hostile world
Now that Western finance capitalism is stagnating, it is fighting even harder to prevent the post-2008 crisis from leading to socialist reforms that would re-socialize infrastructure that has been privatized and put a public banking system in place. Depicting the contrast between socialist and finance-capitalist economies as a clash of civilizations, U.S.-centered "Western" diplomacy is using military and political subversion to prevent a transition from capitalism into socialism.
China is the leading example of socialist success in a mixed economy. Unlike the Soviet Union, it has not proselytized its economic system or sought to promote revolution abroad to emulate its economic doctrine. Just the opposite: To avert attack, China has given foreign investors a stake in its economic growth. The aim has been to mobilize U.S. and other foreign interests as allies, willing customers for China's exports, and suppliers of modern production facilities in China.
This is the opposite of the antagonism that confronted Russia. The risk is that it involves financial investment. But China has protected its autonomy by requiring majority Chinese ownership in most sectors. The main danger is domestic, in the form of financial dynamics and private rent extraction. The great economic choice facing China today concerns the degree to which land and natural resources should be taxed.
The state owns the land, but does fully tax its rising valuation or rent-of-location that has made many families rich. Letting the resulting real-estate and financialized wealth dominate its economic growth poses two dangers: First, it increases the price that new buyers must pay for their home. Second, rising housing prices force these families to borrow – at interest. This turns the rental value of land – value created by society and public infrastructure investment – into a flow of interest to the banks. They end up receiving more over time than the sellers, while increasing the cost of living and doing business. That is a fate which a socialist economy must avoid at all costs.
At issue is how China can best manage credit and natural resource rent in a way that best meets the needs of its population. Now that China has built up a prosperous industry and real estate, its main challenge is to avoid the financial dynamics that are subjecting the West to debt deflation and burying Western economies. To avoid these dynamics, China must curtail the proliferation of unproductive debt created merely to transfer property on credit, inflating asset prices in the process.
Socialism is incompatible with a rentier class of landlords, natural resource owners and monopolists – the preferred clients of banks hoping to turn economic rent into interest charges. As a vehicle to allocate resources "the market" reflects the status quo of property ownership and credit-creation privileges at any given moment of time, without consideration for what is fair and efficient or predatory. Vested interests claim that such a market is an immutable force of nature, whose course cannot be altered by government "interference." This rhetoric of political passivity aims to deter politicians and voters from regulating economies, leaving the wealthy free to extract as much economic rent and interest as markets can bear by privatizing real estate, natural resources, banking and other monopolies.
Such rent seeking is antithetical to socialism's aim to take these assets into the public domain. That is why the financial sector, oil and mineral extractors and monopolists fight so passionately to dismantle state regulatory power and public banking. That is the diplomacy of finance capital, aiming to consolidate American hegemony over a unipolar world. It backs this strategy with a neoliberal academic curriculum that depicts predatory financial and rentier gains as if they add to national income, not simply transfer it into the hands of the rentier classes. This misleading picture of economic reality poses a danger for China sending its students to study economics at American and European universities.
The century that has elapsed since Russia's October 1917 Revolution has produced a substantial Marxist literature describing how finance capitalism has overpowered industrial capitalism. Its dynamics occupied Marx in Volumes II and III of Capital (and also his Theories of Surplus Value ). Like most observers of his era, Marx expected capitalism to make a substantial step toward socialism by overcoming the dynamics of parasitic capital, above all the tendency for debt to keep on expanding at compound interest until it produces a financial crash.
The only way to control banks and their allied rentier sectors is outright socialization. The past century has shown that if society does not control the banks and financial sector, they will control society. Their strategy is to block government money creation so that economies will be forced to rely on banks and bondholders. Regulatory authority to limit such financial aggression and the monopoly pricing and rent extraction it supports has been crippled in the West by "regulatory capture" by the rentier oligarchy.
Attempts to tax away rental income (the liberal alternative to taking real estate and natural resources directly into the public domain) is prone to lobbying for loopholes and evasion, most notoriously via offshore banking centers in tax-avoidance enclaves and the "flags of convenience" sponsored by the global oil and mining companies. This leaves the only way to save society from the financial power to convert rent into interest to be a policy of nationalizing natural resources, fully taxing land rent (where land and minerals are not taken directly into the public domain), and de-privatizing infrastructure and other key sectors.
Markets have not recovered for the products of American industry and labor since 2008. Industrial capitalism has been sacrificed to a form of finance capitalism that is looking more pre-capitalist (or simply oligarchic and neofeudal) with each passing year. The resulting polarization forces every economy – including China – to choose between saving its bankers and other creditors or freeing debtors and lowering the economy's cost structure. Will the government enforce bank and bondholder claims, or will it give priority to the economy and its people? That is an eternal political question spanning pre-capitalist, capitalist and post-capitalist economies.
Marx described the mathematics of compound interest expanding to absorb the entire economy as age-old, long predating industrial capitalism. He characterized the ancient mode of production as dominated by slavery and usury, and medieval banking as predatory. These financial dynamics exist in socialist economies just as they did in medieval and ancient economies. The way in which governments manage the dynamics of credit and debt thus are the dominant force in every era, and should receive the most pressing attention today as China shapes its socialist future.
 I give the details in "Simon Patten on Public Infrastructure and Economic Rent Capture," American Journal of Economics and Sociology 70 (October 2011):873-903.
 My book Super-Imperialism (1972; new ed. 2002) reviews this discussion during 1944-46.
 I discuss the IMF and World Bank plan to wipe out Russian savings with hyperinflation and make manufacturing investment uneconomic in "How Neoliberal Tax and Financial Policy Impoverishes Russia – Needlessly," Mir Peremen (The World of Transformations), 2012 (3):49-64 (in Russian). МИР ПЕРЕМЕН 3/2012 (ISSN 2073-3038) Mir peremen М. ХАДСОН, Неолиберальная налоговая и финансовая политика приводит к обнищанию России, 49-64.
 I give details in "How Neoliberals Bankrupted 'New Europe': Latvia in the Global Credit Crisis," (with Jeffrey Sommers), in Martijn Konings, ed., The Great Credit Crash (Verso: London and New York, 2010), pp. 244-63, and "Stockholm Syndrome in the Baltics: Latvia's neoliberal war against labor and industry," in Jeffrey Sommers and Charles Woolfson , eds., The Contradictions of Austerity: The Socio-Economic Costs of the Neoliberal Baltic Model (Routledge 2014), pp. 44-63.
 For more analysis see Dirk Bezemer and Michael Hudson, " Finance is Not the Economy: Reviving the Conceptual Distinction ," Journal of Economic Issues , 50 (2016: #3), pp. 745-768.
Oct 10, 2017 | fish12a.livejournal.com
...The data were officially published on the website of the Ministry of Finance of Ukraine. http://index.minfin.com.ua/index/debt/
Before the revolution, Ukraine's external debt was more than now: 142 billion dollars. Now, as of July 1, 2017 it is slightly less than 114 billion. How this can happen during civil war it is not very clear...
But the country's GDP in three years fell exactly two times. That's what typically happens during civil war. It was 183 billion dollars, and now became 93 billion. That means $2186 per capita in 2016 year... With the average salary around $150 a month and the average pension less then $80 a month.
Sep 30, 2017 | www.unz.com
The current 17-year old US war in Afghanistan has uncanny resemblances to the Vietnam War. In Kabul and Saigon, the US installed puppet governments that command no loyalty except from minority groups. They were steeped in drugs and corruption, and kept in power by intensive use of American air power. As in Vietnam, the US military and civilian effort in Afghanistan is led by a toxic mixture of deep ignorance and imperial arrogance.
The US military understands it has long ago lost the Afghan War but cannot bear the humiliation of admitting it was defeated by lightly-armed mountain tribesmen fighting for their independence. In Vietnam, Washington could not admit that young Vietnamese guerillas and regulars had bested the US armed forces thanks to their indomitable courage and intelligent tactics. No one outside Vietnam cared about the 2-3 million civilians killed in the conflict
Unfortunately, the PBS program fails to convey this imperial arrogance and the ignorance that impelled Washington into the war – the same foolhardy behavior that sent US forces into Somalia, Afghanistan and Iraq and perhaps may do so in a second Korean War. The imperial spirit still burns hot in Washington among those who don't know or understand the outside world. The lessons of all these past conflicts have been forgotten: Washington's collective memory is only three years long.
Vietnam was not a 'tragedy,' as the PBS series asserts, but the product of imperial geopolitics. The same holds true for today's Mideast wars. To paraphrase a famous slogan from Vietnam, we destroyed Iraq, Afghanistan and Syria to make them safe for 'freedom.'
One of the craziest things about the Vietnam War has rarely been acknowledged: even at peak deployment, the 550,000 US soldiers in Vietnam were outnumbered by North Vietnamese fighting units.
That's because the huge US military had only about 50,000 real combat troops in the field. The other half million were support troops performing logistical and administrative functions behind the lines: a vast army of typists, cooks, truck drivers, psychologists, and pizza-makers.
Too much tail to teeth, as the army calls it. For Thanksgiving, everyone got turkey dinner with cranberry sauce, choppered into the remotest outposts. But there were simply not enough riflemen to take on the Viet Cong and tough North Vietnamese Army whose Soviet M1954 130mm howitzer with a 27 km range were far superior to the US Army's outdated WWII artillery.
Poor generalship, mediocre officers, and lack of discipline ensured that the US war effort in Vietnam would become and remain a mess. Stupid, pointless attacks against heavily defended hills inflicted huge casualties on US troops and eroded morale.
The monumentally stupid war mismanagement of Pentagon chief Robert McNamara, a know-it-all who knew nothing, turned the war into a macabre joke. This was the dumbest command decision since Louis XV put his girlfriend Madame de Pompadour in charge of his armies.
We soldiers, both in Vietnam and Stateside, scorned the war and mocked our officers. It didn't help that much of the US force in 'Nam' were often stoned and rebellious.
The January 30, 1968 Tet Offensive put the kibosh on US plans to pursue the war – and even take it into south-west China. Tet was a military victory of sorts for the US (and why not, with thousands of warplanes and B-52 heavy bombers) but a huge political/psychological victory for the Communists in spite of their heavy losses.
I vividly recall standing with a group of GI's reading a typed report on our company barracks advising that the Special Forces camp in the Central Highlands to which many of our company had been assigned for immediate duty had been overrun at Tet, and all its defenders killed. After that, the US Army's motto was 'stay alive, avoid combat, and smoke another reefer.'
The war became aimless and often surreal. We soldiers all knew our senior officers and political leaders were lying. Many soldiers were at the edge of mutiny, like the French Army in 1917. Back in those ancient days, we had expected our political leaders to be men of rectitude who told us the truth. Thanks to Vietnam, the politicians were exposed as liars and heartless cynics with no honor.
This same dark cloud hangs over our political landscape today. We have destroyed large parts of the Mideast, Afghanistan and northern Pakistan without a second thought – yet wonder why peoples from these ravaged nations hate us. Now, North Korea seems next.
Showing defiance to Washington brought B-52 bombers, toxic Agent Orange defoliants and endless storms of napalm and white phosphorus that would burn through one's body until it hit bone.
In spite of all, our imperial impulse till throbs. The nightmare Vietnam War in which over 58,000 American soldiers died for nothing has been largely forgotten. So we can now repeat the same fatal errors again without shame, remorse or understanding.
(Republished from EricMargolis.com by permission of author or representative)
anonymous, Disclaimer September 30, 2017 at 3:36 pm GMTanonymous, Disclaimer September 30, 2017 at 3:36 pm GMT
For both Vietnam and Afghanistan, as well as other places, the guiding principle is that they live there and we don't. These are all expeditionary wars for the US. Resistant peoples can't be controlled at a distance. Of course the morale of US soldiers ends up being bad when they realize there's nothing for them to fight for. No one wants to die to help some politician save face. Insofar as the current much publicized Vietnam documentary goes there doesn't seem to be anything that's new or original. All of it has been known for many years to anyone who would bother to brush up on the subject. The question is whether Americans are capable of learning from the past and the answer seems to be no for the vast majority.Cranky, September 30, 2017 at 3:37 pm GMT
For both Vietnam and Afghanistan, as well as other places, the guiding principle is that they live there and we don't. These are all expeditionary wars for the US. Resistant peoples can't be controlled at a distance. Of course the morale of US soldiers ends up being bad when they realize there's nothing for them to fight for. No one wants to die to help some politician save face. Insofar as the current much publicized Vietnam documentary goes there doesn't seem to be anything that's new or original. All of it has been known for many years to anyone who would bother to brush up on the subject. The question is whether Americans are capable of learning from the past and the answer seems to be no for the vast majority.nsa, September 30, 2017 at 5:55 pm GMT
So whose name gets to be the last American killed in Afghanistan, Iraq, Syria, etc? Dying for a place on the memorial, boys. "The war was being run by a bunch of four-star clowns who were going to end up giving the whole circus away."
Some things don't change- I wonder if Rand has a new copy of the Pentagon Papers regarding post 9/11. And a new Nixon in office .he vowed to get out too -- and yet pushed more into it simply amazing.Priss Factor, Website September 30, 2017 at 7:27 pm GMT
@Sam McGowan First, I was heavily involved in Vietnam from 1965 to 1970. Second, I have written extensively about the war and read the books. The fact is that the US didn't "lose" the war, the left-wing presidents that got us into it, JFK and LBJ, has no intention of defeating the communist insurgency, they just wanted "to contain it". Cam Ranh Bay and made a speech in which he commented to the troops present that he wanted them to "nail the coonskin to the wall." Richard Nixon began withdrawing troops immediately after his inauguration and gave Abrams an edict to "reduce American casualties" shortly afterwards. In fact, Vietnam as well as Korea - as well as other wars around the world - were continuations of World War II, which Americans thought ended when the Japanese surrendered. By the way, I am not watching Ken Burn's latest left-wing propaganda piece nor do I intend to. I don't need him to tell me what happened in Southeast Asia, I was there. Save your senile hot air for the other menopausal drunks drooling in the VFW lounge. The conscript US military completely collapsed fragging, rampant drug usage, desertion, abject morale, chain of command disintegration, and the usual commissioned officer cowardice. Any western country stupid enough to pursue a land war in Asia deserves what it gets .inevitable defeat and humiliation.Anon, Disclaimer October 1, 2017 at 4:37 am GMT
I don't think CucKen Burns is entirely wrong in empathizing with those who got involved. Sure, there were warmongers. Sure, they were profiteers. Sure, there were power-maniacs. Sure, there were paranoids.
But Eisenhower, Kennedy, Johnson, and Nixon were not particularly sadistic or cruel men. Eisenhower could be aloof and mean. Kennedy could be vain. Johnson was plenty corrupt. Nixon could be nasty. But were not psychos or radicals like Lenin, Stalin, Hitler, or Mao.
As for military men, well, whaddya expect? They were trained to think of the world in terms of military power. As for CIA, we are talking of more sinister elements, but let's keep in mind that Soviets had their intelligence organizations and methods of subversion. Let's remember Soviets had infiltrated FDR's government and pulled dirty trick. Even got the Bomb during Truman era.
Also, Soviets could be utterly ruthless in their own empire.
Now, would the US have intervened in Vietnam if the nation was to be united by a non-communist nationalist? Probably not. US didn't intervene in Indonesia when it gained independence under Sukarno. The only reason US got involved was because Ho was a Soviet-leaning communist. And even though Domino theory has been 'debunked', it made sense at the time. Even Soviets believed in it. Mao believed in it. Soviets believed that sign of US weakness could spread the revolution all around. Che Guevara believed in the Domino Theory. Communist victory over Cuba, he thought, would herald spread of communism all over Latin America, and then it would spread into US itself. Che really believed this, which is why he died in Bolivia trying to start an insurgency.
Also, in a way, Domino Theory did come true, at least for awhile. Not so much in Southeast Asia, though Laos and Cambodia also fell to communism. And keep in mind Indonesia almost could have become communist if the Peking-backed coup had succeeded. And keep in mind it took lots of British brutality and ruthlessness to stem the communist movement in Malaysia. Brits built huge hamlets and concentration camps. They took extreme measures.
At any rate, communism did continue to spread after the fall of Vietnam. US power seemed to be declining. And not only communists were emboldened by US defeat in Vietnam. Vietnam became a metaphor for anti-Americanism all over the world. May 68 movement that almost brought down the French government was fired up partly by Vietnam(though it began as some silly stuff about dorms and sex). Vietnam was bigger than Algeria because US was seen as the Great Power. French defeat wasn't all that surprising in Algeria. So, after US left from Vietnam, there was a sense that David could beat American Goliath. Iran regime fell and Islamists came to power. Afghanistan turned communist, and Soviets felt emboldened in rolling in tanks. Ethiopia, Mozambique, and Angola turned communist. Communists won in Nicaragua and almost won in El Salvador. There was a raging Maoist insurgency in Peru. Allende came to power through elections, and he was pro-Soviet and pro-Cuba. He was removed only by US-backed coup that did as much harm as good. It blackened US reputation around the world. So, in a way, the Domino Theory wasn't all wrong. Vietnam did signal a sea-change in world politics at least for awhile.
In the end, communism wasn't defeated by the US. It defeated itself. Soviet economics just couldn't sustain the empire. Its subsidies to Cuba were costly. Its support of Marxist regimes in Africa drained Soviet economy. USSR had to prop up Iron Curtain nations economically. And Vietnamese communism was a disaster. Maoism was hell on earth. Some might say communism failed cuz Capitalist West froze the communists out of world trade. But considering that the communist world encompassed resource-rich Soviet Empire, people-rich China, and lots of nations willing to do business with communist nations -- India and Arab nations had good relations with Soviets -- , the real reason for failure of communism was it was its own worst enemy.
And when we look at the aftermath of communist victory in Indochina -- brutal repression in Vietnam and Laos and psychotic democide in Cambodia -- and when we consider how even communist nations like China and Vietnam switched to market economics, it's clear that US was on the right side of history on many issues.
Also, the conflict was complicated because both sides were aggressors. US was the aggressor in working with the French to divide Vietnam in half, in occupying the southern half, and dropping bombs and using Viet women as whores. But the communists were also aggressors because they tried to impose a form of Stalinism on people in the South, most of whom didn't want communism. After all, many more people fled the north to the south than vice versa. Why? There is something prison-like about communism. The commissars never leave you alone. Also, North Vietnamese leaders, though inspired and patriotic, were utterly ruthless in their own way, willing to sacrifice any number of people for victory just like Japanese militarists were willing to Go All the Way instead of calling it quits to save lives.
Still, in retrospect, Ho Chi Minh was a genuine patriot, a legendary figure much beloved by many Viets. And for that reason, US shouldn't have intervened, and the whole mess could have been avoided.
CucKen Burns makes my skin crawl, but at his best, he can look at both sides of the issue instead of going for b/w version of history with good guys vs bad guys.
That said, maybe his position reflects globalism. As Proglobalists now control the US, the neo-Pax-Americana is about the spread of agendas favored by the likes of CucKen Burns, like homomania, Jewish Power, anti-nationalism, and Afromania. Today's progs want the world to become neo-Americanized.
And in Vietnam, as Linh Dinh reported, there is now homo parades and Afromania and Vietcuckery. So, considering that Viet commies stood for patriotism and national sovereignty, maybe the globalist viewpoint is more favorable to US efforts to turn Vietnam into globo-disneyland.
After all, where was CucKen Burns when Obama and Hillary were destroying Libya, Ukraine, Syria, and etc. Where were he and his ilk when Jews were cooking up New Cold War with Russia with hysteria that would make McCarthy blush?Jim Christian, October 1, 2017 at 6:03 am GMT
Is the view that JFK wanted out of Vietnam merely a conspiratorial fantasy?. The following articles are easy reads:
Exit Strategy: In 1963, JFK ordered a complete withdrawal from Vietnam
James K. Galbraith, BOSTON REVIEW
JFK's Vietnam Withdrawal Plan Is a Fact, Not Speculation
A response to Rick Perlstein.
By James K. Galbraith, THE NATIONJim Christian, October 1, 2017 at 6:22 am GMT
"The question is whether Americans are capable of learning from the past and the answer seems to be no for the vast majority."
Americans at-large have no power. A small cadre runs things now. Once Americans didn't have a draft to worry over, they vacated the streets and left the dying to the farmers' sons (metaphor for the poor). That's all it is. The damage done to the economy, the sheer quantities of cash vacuumed up from the rest of the country and showered over the Washington DC region escapes the imagination of us out here in the country with our local issues and problems. These, rooted in the sheer theft of our taxes and handed over to the war-mongers of DC because there simply isn't enough left over after feeding The Beast in Washington. We have aircraft carriers that can't launch aircraft, planes that won't fly, weapons that won't work and wrong strategies followed in war-fighting and procurement, yet still, the theft goes on.
War after war lost, yet the Generals are still revered, money to the pro-war think tanks is never ending and the revolving door between the Pentagon, White House and defense contractors (and their corporate boards) has never been richer. Doesn't matter the war industry doesn't win wars, the money is just so damned good they can't stop, won't stop. And who is to stop them? These are the folks that kill people, that have a file on each of us. Indeed, it is our only remaining industry, flawed and failed though it may be. It certainly is a rich one. And it IS unstoppable. Completely. Utterly.2/1Doc RVN 68-89, October 1, 2017 at 12:27 pm GMT
@Sam McGowan Concur all, McGowan, good takes. Yeah, my Pop was into Naval spook communications and messaging, he'd pick up the WashPost off the driveway and see various and sundry in the paper lying and white-washing the effort and just be wild by the time he left for work. He knew the carriers were having no success, he knew the air-war was a mess, he knew the Marines were getting killed all over the country. People that knew the truth from the inside hadda keep their traps shut.
By the time I joined up for a 6 year dose of USN carrier decks in 1976 I got the scoop from a few of our officers, almost all of whom had flown with VA35 over Vietnam in A-6′s. Clusterfuck, they could then acknowledge just those few years later, only the most junior officers hadn't served in the air war over Vietnam. And they had good stories that pointed out the folly throughout.
Now? The military is just a revenue-stream, nothing produced, much destroyed to the enrichment of a few insiders.The Alarmist, October 1, 2017 at 4:08 pm GMT
Recently came across some startling statistics about men who served in Vietnam like you and me. Of the 2.7 million who served only 850,000 are still alive at last census!!!!!! 700,500 died prematurely between 1995 census and 2000 census. No country for old men .The Alarmist, October 1, 2017 at 4:25 pm GMT
"And in Vietnam, as Linh Dinh reported, there is now homo parades and Afromania and Vietcuckery. So, considering that Viet commies stood for patriotism and national sovereignty, maybe the globalist viewpoint is more favorable to US efforts to turn Vietnam into globo-disneyland."
Bingo! The only problem is that the globalists are now using the opportunity to also wear down the populations of the home territories as well. The only reason our national economic imperialism wasn't enough of a raging success (don't get me wrong by any rational measure it was) was that it was kept in check by the opposing communist bloc, and still America managed to conquer the so-called free world with Coca Cola, McDonalds, Hollywood Inc., etc.
When the communists gave up and joined the party, our globalist masters realized that they could not only amass further wealth by spreading these things to the former communist bloc and under-exploited non-aligned nations, but they could now squeeze even more profit-margin out of the home territories by wearing down the power of the local workforce at all levels, except, of course, for the very pinnacle, by outsourcing production and even many services to the newly "developing world."
Ironically, fighting the communist threat probably kept our leadership more honest than they have been in the new world order since the fall of communism.KenH, October 1, 2017 at 11:00 pm GMT
"No one in Washington seemed to know that China and the Soviet Union had split and become bitter enemies. As ever, our foreign human intelligence was lousy."
They knew of the rift that had grown since 1960 or so, but they didn't believe it until the short border war in 1969. The same way that a number of indicators suggested as early as 1983 that the USSR was imploding, but the menace of the USSR was used to keep justifying a buildup and procurement of new systems until and even beyond its actual implosion a few years later.
Evil, stupid, or merely blind. You decide.DB Cooper, October 2, 2017 at 4:38 am GMT
I know opinions vary on Ken Burns/PBS's "Vietnam" documentary, but what struck me is that we're following the same script in Afghanistan and the Middle East as we were in Vietnam and expecting a different (i.e., more favorable) outcome. The script being "pacification" through providing medicine, foodstuffs, soccer balls and American smiles to the local populations combined with placing massive amounts of ordnance on targets deemed hostile. It didn't win hearts and minds then nor is it now.
The generals keep telling us that with just a few more antibiotics, soccer balls and troops victory is around the bend.
Hindsight's always 20/20, but to be fair a military force in Vietnam did seem like the right thing do at least in the early years. Any de-escalation and/or withdrawals would have been perceived by a rabidly anti-communist population as surrendering to communist aggression and political suicide for any president proposing it.
The monumentally stupid war mismanagement of Pentagon chief Robert McNamara, a know-it-all who knew nothing,
We have legions of McNamara's calling the shots today. They are called neoconservatives and liberal interventionists. The big brains of the Ivy league do seem to excel at steering us into icebergs time and again.
As it was former allies Vietnam and China briefly fought each other in 1979 and Vietnam didn't have the desire or the ability to project power much beyond Cambodia and Laos.Diversity Heretic, October 2, 2017 at 6:14 am GMT
"We really believed that if the US did not make a stand in Vietnam the Soviets and Chinese would overrun all of South Asia."
India played a big role in shaping this narrative. Just five years ago before 1967 China finally responded to India's creeping land grab after years of trying to warn New Delhi's to stop its 'Forward Policy' by launching a massive anticipatory strike into India. India was defeated militarily but India was able to fool the world that India was a hapless victim against an agressive China when in fact the reverse is true.Blowback, October 2, 2017 at 1:07 pm GMT
@Jim Christian A bit off topic, but, since I know that you had naval experience, any take on why Navy ships keep colliding with merchantmen? Is it reduced competence because of racial and sexual preferences, or overworked sailors because deployed ships are short-staffed as a result of pregnancies? Or is it just a run of bad luck? I've read some different theories but I've seen you post often enough to know that you'll have an informed opinion.Jim Christian, October 2, 2017 at 1:09 pm GMT
@Sam McGowan What don't you understand about Clausewitz's dictum "war is the mere continuation of politics with other means"? War is what you do when you can't achieve your political objectives by other means. The United States' political objective in Vietnam was to prevent the American satrapy in the south being re-united by the nationalists in the north. So, where the f ** k is South Vietnam? The United States might believe it won every battle (slight exaggeration) but it still lost the American war.Don Bacon, October 2, 2017 at 2:56 pm GMT
@Diversity Heretic The military is off-kilter all over. Navigation? Routine. Ought to be. Not anymore. Procurement? Driven by inertia and the corruption of planners that know a carrier's planes are useless if the ship has to stand off 500-1000 miles because of a cruise missile environment that they KNOW every third-world shitbox has been building for 30 years now, starting with the Norks. From aircraft to ships, a complete clusterfuck.
Personnel? Ya gotta be shitting me, right? Between the sexism, reverse-racism and the cultural kookiness from the top of a terrorized Central Command and throughout the military, right down to the pretty little Blonde Hispanic Black Dwarf tranny just dying to terrorize said command with a complaint, we really haven't much good to say about our staffing. It's not a meritocracy anymore, hasn't been since Reagan. The entire thing is sitting there waiting to be taken down and humiliated.
And still? We sprinkle the trillions onto the DC region, make the war planners rich, we still lionize Generals and Admirals that haven't won shit in 75 years and we cycle them through the think tanks and corporate boards of the defense contractors and make THEM rich too. Then we even put them in charge at the White House, having discarded the notion of Congressional approval for the wars they "fight" in our names. And they start wars. And finally, the notion that we have civilian control of our military is long gone. We are a Junta. There is a coup ongoing, two or more in our past and we're no more than a broke but dangerous and heavily armed danger to the rest of the world run by the thugs of the Pentagon, the think tanks, the defense contractors and the lazy sloth of Congress, who is supposed to keep this shit straight and Constitutional. Doom. Yes, the word doom comes to mind.Jim Christian, October 2, 2017 at 4:08 pm GMT
@anonymous re: "No one wants to die to help some politician save face."
I don't have a teevee, but I bet they didn't cover the mutiny in the ranks which is the main reason the US had to withdraw because of a "broken army." That included fragging, mission refusal, and an overall negative attitude as you suggest. Now we have a volunteer army, a warrior class, which changes that dynamic.Diversity Heretic, October 2, 2017 at 6:18 pm GMT
Thanks! Always appreciate your candor!
One man's opinion. I do wish someone would show me where I'm wrong, but I spent too many years down in DC doing their tech stuff after I left the Navy (too many women that couldn't, at that point in 82, go to sea) and so they only had more sea duty because the shore billets were all taken in their haste to "integrate" women into the Navy. Even instructor duty for Naval Air Maintenance was hosted by women that had never served a day in carrier air, training the young mice how to do business on a flight deck. They did offer me, for variety, another four year hitch in a WestPac squadron aboard one damned carrier deck or another. Already having done 5, I said no thanks and went back home to Virginia. And so I got familiar with the workings of the spooks, Booze, Allen, Heritage, Cato, Brookings, the Pentagon, NSA, FBI, Quantico, there were hundreds of them, most with two or three names in the chain of title. I did their phones for decades, they're psychos, they're paranoid, everything classified and spooky and ooga-booga. Worthless ants on a big log and they each think they're steering it down the river.
Bunch of fucking Frank Burns's is what they are..Cheers.anonymous, Disclaimer October 2, 2017 at 11:03 pm GMT
@Jim Christian Take care of yourself. People like you are a national asset, appreciated by at least some of us.Jack Spratt, October 3, 2017 at 4:57 am GMT
There never was a communist threat. Not since at least the 1920s, when Stalin defeated Trotsky. Trotsky wanted world revolution. Stalin, for all his bloodthirsty antics in Russia, realised this was all nonsense. He just wanted Socialism in One Country, developing the country economically. He wasn't really interested in the outside world.
In the 1930s he was willing to cooperate with right wing western governments till they did a deal with Hitler in 1938. He was never interested in invading countries to grab land and resources. Whenever he did so, Poland in 1939, or Eastern Europe post 1945, it was for security reasons. The part of Poland he occupied in 1939 had been taken from Russia by force in 1920. It was inhabited by 1o million White Russians and Ukrainians and no Poles.Capn Mike, October 3, 2017 at 5:20 am GMT
Wissing's book "Funding the enemy" details the totally corrupt Afghan government and is a compelling argument why we should pull out at once and needs to be read by anyone with half a brain. I served in Vietnam also, in 1967, and its deja vu all over again.Vidi, October 3, 2017 at 6:15 am GMT
@The Alarmist Having been on – site at the time (North Tonkin Gulf), I can tell you that China gave U.S.N. units free rein over those waters, including Chinese waters. The fix was in. In 1969 onwards. China and Viet Nam were NEVER friends. Did CIA realize this? I don't know.wayfarer, October 3, 2017 at 6:19 am GMT
Anyways, expect the US to keep on wasting money in Afghanistan (and Pakistan and Tajikistan) until it gets bankrupted by the next Big War!
Or until all the routes into Afghanistan are blocked. At the moment, the only route still open passes through Pakistan, and that may close at any time.Hibernian, October 3, 2017 at 10:57 am GMT
Of the 58,220 Americans who were sacrificed by the U.S. Government during the Vietnam War, 270 were Jewish. That's approximately 0.46 percent of the total number of American kids who died, or less than a half of one-percent.
"Statistical Information About Casualties of the Vietnam War"
" 9/11 Israel Did It! "
https://wikispooks.com/wiki/9-11/Israel_did_itHibernian, October 3, 2017 at 11:05 am GMT
@Grandpa Charlie The Japanese trained their naval cadets using a mock Pearl Harbor type exercise annually for a fair number of years prior to WW2. The Russo-Japanese War of 1905 began with a Japanese surprise attack. You have the unmitigated gall to attack Margolis as an establishment mouthpiece when you yourself are whitewashhing the "sainted" FDR. No prudent military planner would absolutely assume that the attack would come in one particular place, whether the Phillipines, Pearl, or elsewhere.Che Guava, October 3, 2017 at 12:13 pm GMT
@Don Bacon Too many of the volunteers are really economic draftees. You can have plenty of discipline problems with volunteers, I've seen it up close and personal, although never reaching the level of mutiny.Hu Mi Yu, October 3, 2017 at 12:52 pm GMT
@Capn Mike That is interesting to me. As is the Margolis artictle, never knew he had been a USA soldier, very interesting article. Thought he was a Canada person.
I have a question for you, Capn Mike.
If the PRC had allowed the USA free rein in Gulf of Tonkin, where were the supply lines to the Nth. Viet military and Viet Cong?
Must it not still have been overland from PRC at that time you say (1969)?Max Havelaar, October 3, 2017 at 1:41 pm GMT
I don't for a moment believe that the 'saintly' President John Kennedy planned to end the war but was assassinated by dark, rightwing forces, as is claimed. This is a charming legend. Richard Nixon, Kennedy and Lyndon Johnson all feared that a withdrawal from Vietnam would lose them the next election. Republicans were still snarling over 'who lost China'.
I didn't like Kennedy either, but go back and reread the newspapers from the early days of the Kennedy administration. The oval office was bugged, and the information leaked in ways to embarrass Kennedy and UN Ambassador Adelai Stevenson. There is only one way that could have happened. Eisenhower installed those bugs before he left. These same bugs brought down Nixon in the Watergate crisis. The swamp wanted war, and they pulled the rug out from under both presidents as soon as they brought peace.
And a new Nixon in office .he vowed to get out too- and yet pushed more into it simply amazing.
He promised to get out and he did get us out. The peace treaty was announced just before the election in 1972. He knew it was his only hope for re-election. The Vietnamese disputed some of the terms, and that resulted in the Christmas bombing that year. The American withdrawal began in January 1973.
Trump promised to get us out of the Middle East. We should give him some rope. Maybe he hangs himself, or just maybe he can pull it off. He will need to be re-elected in three years.jacques sheete, October 3, 2017 at 3:25 pm GMT
Nice personal account of Vietnam.
However, the US foreign policy keeps holocausting the 3-rd world and lately the 2 -cond world.
The holocausts keep coming from US foreign policy of "exceptionalism" = "Nazi Übermensch"="the chosen ones" over this planet, many executed by the CIA-Nazi's:
The Syrian holocaust
The Yemen holocaust
The Ukranïan holocaust (Euromaidan) by Poroshenko/Nuland neo-nazi"s.
The Libyan holocaust
The Irak holocaust
The Afghanistan holocaust
The Belgrad holocaust
The Indonesian holocaust (Kissiger e.a.)
The Vietnam/Laos/Cambodia/Thailand holocaust (Kissinger e.a)
The Korean holocaust
The Jewish/Polish/Russian holocaust by Nazi's funded by Wallstreet/London bankers
The German holocaust (Die Rheinweisen lager) by US army Morgenthau plan.
The Ukranian and Russain holocausts 1921-22, 1932-33 (holodomor) by Lenin, Trotsky, Stalin.
All these, were and are financed by the Wallstreet elite owners, the Billionaires who are mega-fascists, eugenic and satanic in character. Their credo is GREED.
(sources: Antony Sutton, Carrol Quickley, W.F. Engdahl)
Thanks to Vietnam, the politicians were exposed as liars and heartless cynics with no honor.
A couple of the biggest lies were exposed, but the myths still live that the US government is an effective and dependable force for peace and freedom, and that the US military is an institution of dignity worthy of honor.
And people still put their faith (or is it hope) in the heartless cynics ( eunichs, really) with no balls, fewer brains, no soul, and even less honor.
Jul 09, 2016 | therealnews.com
BACEVICH: Well, I think that's true. I mean, for the moment, we should take anything that Donald Trump or Hillary Clinton has to say with a grain of salt. They will say whatever they think will improve their chances of being elected in the fall. That said, I would not expect either of them, if elected, to bring about any serious rethinking of U.S. national security policy. As I suggested in that Harper's piece, they are different versions of hawks.
... ... ...
BACEVICH: Well, I think, I think that the meeting between FDR and the Saudi King that you cite is a very important waystation. That committed the United States to securing the monarchy, in return for expectations that we would have privileged access to oil in the Persian Gulf.
However, I think the real turning point happens in 1980. Prior to 1980, there certainly was a U.S. policy in the greater Middle East, but it was not a U.S. policy that found expression in any serious military commitment. That changes in 1980, when Jimmy Carter promulgates the Carter doctrine. If you recall, that's a statement that designates the Persian Gulf a vital U.S. national security interest, and explicitly a place that we're now willing to fight for. So prior to 1980, no major U.S. military involvement in the region. Beginning in 1980, a pattern of armed interventionism in the greater Middle East that continues down to the present day, and at least in my judgment has been unsuccessful, and indeed, counterproductive. So the military narrative really begins in 1980.
JAY: Yeah, it's interesting with a Democratic president, from the Democratic Party, certainly under the sway of Zbigniew Brzezinski, who was more or less the architect, I think, of the Carter doctrine, and leads to the war in Afghanistan. I guess--I hope most people know the basic story there, that the Americans funded jihadists in Afghanistan to suck the Russians in, and then successfully so, into a quagmire. And even though that led to the forming of the Taliban and Al-Qaeda and Bin Laden.
And I think you can probably draw a straight line from that Carter doctrine right to 9/11, in terms of--it's a good example, I think, of what you're talking about, how this foreign policy--.
BACEVICH: I don't, I don't know that I'd call it a straight line, but there's a line. I mean, there certainly are a whole bunch of dots that can be connected. And I think that the Afghanistan experience, we're supporting the jihadists, is a good example of the unexpected consequences of U.S. interventionism.
At our present moment, as you and I are speaking, the concern is about ISIS. Certainly it's a, it's reasonable to view ISIS as a threat. It's also true that ISIS would not exist had not the United States invaded Iraq back in 2003. We shattered Iraq, and out of the chaos of Iraq has emerged this new terrorist entity.
So both of these, Afghanistan in the '80s, Iraq beginning in 2003, illustrate the larger point that U.S. military interventionism in this region simply has not produced the positive outcomes that policymakers have, have expected.
... ... ....
BACEVICH: ...The foundation of our expectations of being the indispensable nation lie in the belief that we possess military might such as the world has never seen. And yet what we have found time and again in the greater Middle East is our military might is inadequate to the challenge. And we're not willing to admit that. Foreign policy establishment is not willing to admit that. And frankly, I think the majority of the American people are not willing to admit that. Not willing to admit that we are not history's agent.
Oct 01, 2017 | www.jacobinmag.com
BSR There have been numerous crises since 2007. How does the history and concept of neoliberalism help us understand them? DH There were very few crises between 1945 and 1973; there were some serious moments but no major crises. The turn to neoliberal politics occurred in the midst of a crisis in the 1970s , and the whole system has been a series of crises ever since. And of course crises produce the conditions of future crises.
In 1982–85 there was a debt crisis in Mexico, Brazil, Ecuador, and basically all the developing countries including Poland. In 1987–88 there was a big crisis in US savings and loan institutions. There was a wide crisis in Sweden in 1990, and all the banks had to be nationalized .
Then of course we have Indonesia and Southeast Asia in 1997–98, then the crisis moves to Russia, then to Brazil, and it hits Argentina in 2001–2.
And there were problems in the United States in 2001 which they got through by taking money out of the stock market and pouring it into the housing market. In 2007–8 the US housing market imploded, so you got a crisis here.
You can look at a map of the world and watch the crisis tendencies move around. Thinking about neoliberalism is helpful to understanding these tendencies.
One of big moves of neoliberalization was throwing out all the Keynesians from the World Bank and the International Monetary Fund in 1982 -- a total clean-out of all the economic advisers who held Keynesian views .
They were replaced by neoclassical supply-side theorists and the first thing they did was decide that from then on the IMF should follow a policy of structural adjustment whenever there's a crisis anywhere.
In 1982, sure enough, there was a debt crisis in Mexico. The IMF said, "We'll save you." Actually, what they were doing was saving the New York investment banks and implementing a politics of austerity.
The population of Mexico suffered something like a 25 percent loss of its standard of living in the four years after 1982 as a result of the structural adjustment politics of the IMF.
Since then Mexico has had about four structural adjustments. Many other countries have had more than one. This became standard practice.
What are they doing to Greece now ? It's almost a copy of what they did to Mexico back in 1982, only more savvy. This is also what happened in the United States in 2007–8. They bailed out the banks and made the people pay through a politics of austerity. BSR Is there anything about the recent crises and the ways in which they have been managed by the ruling classes that have made you rethink your theory of neoliberalism? DH Well, I don't think capitalist class solidarity today is what it was. Geopolitically, the United States is not in a position to call the shots globally as it was in the 1970s.
I think we're seeing a regionalization of global power structures within the state system -- regional hegemons like Germany in Europe, Brazil in Latin America, China in East Asia.
Obviously, the United States still has a global position, but times have changed. Obama can go to the G20 and say, "We should do this," and Angela Merkel can say, "We're not doing that." That would not have happened in the 1970s.
So the geopolitical situation has become more regionalized, there's more autonomy. I think that's partly a result of the end of the Cold War. Countries like Germany no longer rely on the United States for protection.
Furthermore, what has been called the "new capitalist class" of Bill Gates , Amazon , and Silicon Valley has a different politics than traditional oil and energy.
As a result they tend to go their own particular ways, so there's a lot of sectional rivalry between, say, energy and finance, and energy and the Silicon Valley crowd, and so on. There are serious divisions that are evident on something like climate change, for example.
The other thing I think is crucial is that the neoliberal push of the 1970s didn't pass without strong resistance. There was massive resistance from labor, from communist parties in Europe, and so on.
But I would say that by the end of the 1980s the battle was lost. So to the degree that resistance has disappeared, labor doesn't have the power it once had, solidarity among the ruling class is no longer necessary for it to work.
It doesn't have to get together and do something about struggle from below because there is no threat anymore. The ruling class is doing extremely well so it doesn't really have to change anything.
Yet while the capitalist class is doing very well, capitalism is doing rather badly. Profit rates have recovered but reinvestment rates are appallingly low, so a lot of money is not circulating back into production and is flowing into land-grabs and asset-procurement instead.
Sep 20, 2017 | www.unz.com
Last month I announced a new strategy for victory in the fight against this evil in Afghanistan. From now on, our security interests will dictate the length and scope of military operation, not arbitrary benchmarks and timetables set up by politicians. I have also totally changed the rules of engagement in our fight against the Taliban and other terrorist groups.
What we see here is undeniable evidence that far from being "real warriors" or "strategists" the military gang around Trump (Mattis, McMaster, Kelly, etc.) are either primitive grunts or folks who owe their rank to political protection. Why do I say that?
Because none of what Trump describes as a "strategy for victory" is, in fact, a strategy. In fact, the US has not had anything remotely resembling a strategy in Afghanistan for years already. If it wasn't so sad, it would be laughable, really. What he really see here is the total absence of any strategy and, again, a total reliance on magical thinking.
Ask yourself a basic question: have you ever heard from any Trump administration or any US General anything which would suggest to you that these guys have i) a clear goal in mind ii) an understanding of what it would take to achieve this goal and iii) a timeframe to achieve this goal and iv) an exit strategy once this goal is achieved? No? Well, that is not your fault, you did not miss anything. They really don't have it.
The amazing reality is that they don't have a goal even defined. How one achieves "victory" when no goal is even defined is anybody's guess.
[Sidebar: without going into a lengthy discussion of Afghanistan, I would say that the only chance to get anything done, any viable result at all, is to negotiate a deal with all the parties that matter: the various Afghan factions, of course, but also with the Taliban, Pakistan, Iran and even Russia.
Pakistan and Iran have a de-facto veto power over any outcome for Afghanistan. This may not be what the US would want, but this is the reality. Denying reality is just not a smart approach to these issues, especially if "victory" is the goal]
Apr 30, 2012 | www.monbiot.com
Colonialism never ended, it continues by different means.
By George Monbiot, published in the Guardian 1st May 2012
The conviction of Charles Taylor, the former president of Liberia, is said to have sent an unequivocal message to current leaders: that great office confers no immunity. In fact it sent two messages: if you run a small, weak nation, you may be subject to the full force of international law. If you run a powerful nation, you have nothing to fear.
While anyone with an interest in human rights should welcome the verdict, it reminds us that no one has faced legal consequences for launching the illegal war against Iraq. This fits the Nuremberg Tribunal's definition of a "crime of aggression", which it called "the supreme international crime"( 1 ). The charges on which, in an impartial system, George Bush, Tony Blair and their associates should have been investigated are far graver than those for which Taylor was found guilty.
The foreign secretary, William Hague, claims that Taylor's conviction "demonstrates that those who have committed the most serious of crimes can and will be held to account for their actions."( 2 ) But the International Criminal Court, though it was established ten years ago, and though the crime of aggression has been recognised in international law since 1945, still has no jurisdiction over "the most serious of crimes"( 3 ). This is because the powerful nations, for obvious reasons, are procrastinating. Nor have the United Kingdom, the United States and other western nations incorporated the crime of aggression into their own legislation. International law remains an imperial project, in which only the crimes committed by vassal states are punished.
In this respect it corresponds to other global powers. Despite its trumpeted reforms, the International Monetary Fund remains under the control of the United States and the former colonial powers. All constitutional matters still require an 85% share of the vote( 4 ). By an inexplicable oversight, the United States retains 16.7%, ensuring that it possesses a veto over subsequent reforms( 5 ). Belgium still has eight times the votes of Bangladesh( 6 ), Italy a bigger share than India and the United Kingdom and France between them more voting power than the 49 African members(7). The managing director remains, as imperial tradition insists, a European, her deputy an American.
The IMF, as a result, is still the means by which western financial markets project their power into the rest of the world. At the end of last year, for example, it published a paper pressing emerging economies to increase their "financial depth", which it defines as "the total financial claims and counterclaims of an economy"( 8 ). This, it claimed, would insulate them from crisis.
As the Bretton Woods Project points out, emerging nations with large real economies and small financial sectors were the countries which best weathered the economic crisis, which was caused by advanced economies with large financial sectors(9). Like the modern opium war it waged in the 1980s and 1990s – when it forced Asian countries to liberalise their currencies, permitting western financial speculators to attack them(10) – the IMF's prescriptions are incomprehensible until they are understood as instruments of financial power.
Decolonisation did not take place until the former colonial powers and the empires of capital on whose behalf they operated had established other means of retaining control. Some, like the IMF and World Bank, have remained almost unchanged. Others, like the programme of extraordinary rendition, evolved in response to new challenges to global hegemony.
As the kidnapping of Abdul Hakim Belhaj and his wife suggests, the UK's foreign and intelligence services see themselves as a global police force, minding the affairs of other nations. In 2004, after Tony Blair, with one eye on possible contracts for British oil companies, decided that Gaddafi was a useful asset, the alliance was sealed with the capture, packaging and delivery of the regime's dissenters( 11 ).
Like the colonial crimes the British government committed in Kenya and elsewhere( 12 ), whose concealment was sustained by the Foreign Office until its secret archives were revealed last month( 13 ), the rendition programme was hidden from public view. Just as the colonial secretary, Alan Lennox-Boyd, repeatedly lied to parliament about the detention and torture of the Kikuyu(14), in 2005 Jack Straw, then foreign secretary, told parliament that "there simply is no truth in the claims that the United Kingdom has been involved in rendition."( 15 )
Reading the emails passed between the offices of James Murdoch and Jeremy Hunt, it struck me that here too is a government which sees itself as an agent of empire – Murdoch's in this case – and which sees the electorate as ornamental. Working, against the public interest, for News Corporation, the financial sector and the billionaire donors to the Conservative party, its ministers act as capital's district commissioners, governing Britain as their forebears governed the colonies.
The bid for power, oil and spheres of influence that Bush and Blair launched in Mesopotamia, using the traditional camouflage of the civilising mission; the colonial war still being fought in Afghanistan, 199 years after the Great Game began; the global policing functions the great powers have arrogated to themselves; the one-sided justice dispensed by international law: all these suggest that imperialism never ended, but merely mutated into new forms. The virtual empire knows no boundaries. Until we begin to recognise and confront it, all of us, black and white, will remain its subjects.
Aug 25, 2017 | www.counterpunch.org
If it's Independence Day, then you can count on John McCain to be bunkered down in a remote outpost of the Empire growling for the Pentagon to unleash airstrikes on some unruly nation, tribe or gang. This July the Fourth found McCain making a return engagement to Kabul, an arrival that must have prompted many Afghans to scramble for the nearest air raid shelter.
From the press room at NATO command, McCain announced that "none of us could say we are on a course to success here in Afghanistan." The senator should have paused for a reflective moment and then called for an end to the war. Instead, McCain demanded that Trump send more US troops, more bombers and more drones to terrorize a population that has been riven by near constant war since the late 1970s.
McCain's martial drool is now as familiar as the opening notes to the "Law & Order" theme song. What may surprise some, however, is the composition of the delegation that signed up to travel on his frequent flier program, notably the presence of two Democratic Senators with soaring profiles: Sheldon Whitehouse and Elizabeth Warren. Whitehouse, the former prosecutor (aren't they all?) from Rhode Island, has lately taken a star turn in the role of chief inquisitor of suspected Russian witches in the Senate intelligence committee hearings. Perhaps he finally located one selling AK-47s to the Taliban to replace the guns they'd gotten from the CIA (We now know that it's the Saudis –not the Russians–who have been covertly funneling money to the Taliban, though don't expect the Trump to impose any sanctions on the Kingdom of the Head-choppers.)
For her part, Warren largely echoed McCain's bellicose banter that Trump needs to double down militarily to finish off the Taliban, the impossible dream. No real surprise here. To the extent that she's advanced any foreign policy positions during her stint in the senate, Warren has been a dutiful supplicant to the demands of AIPAC and the Council on Foreign Relations, rarely diverging from the neocon playbook for the global war on Islam. Warren's Afghan junket is a sure sign of her swelling presidential ambitions. These days "national security" experience is measured almost exclusively by how much blood you are willing to spill in countries you know almost nothing about. It didn't take long for Warren to matriculate to the company position.
Most Americans have no idea why we are in Afghanistan; it's the longest running Fake War in American history. Some, as many as 20 percent according to a Gallup Poll, have no idea that we are still in Afghanistan. Osama Bin Laden and Mullah Omar are both long dead. The shattered remnants of Al Qaeda have fled to Pakistan and parts unknown. Hamid Karzai has come and gone. For the last six months, the US hasn't even troubled itself to send an ambassador to Kabul.
A kind of convenient cultural amnesia has set in, abetted by a compliant press corps that has largely decamped from the Hindu Kush and now treats Afghanistan as if it is some kind of interstellar region, where photographers are occasionally dispatched to snap eerie debris clouds from the detonation of MOAB bombs. It's no wonder that the few Americans who continue to support the war cling to the delusion that Afghanistan orchestrated the 9/11 attacks. It is the War that Time Forgot.
Nothing better illustrates the eclipse of US global power than the fact that Afghanistan refuses to be subjugated or even managed, despite 16 years of hard-core carnage. Since the first US airstrikes hit Kandahar in October 2001, more than 150,000 Afghan civilians have been killed. Still Afghanistan resists imperial dictates. Even after Obama's shameful troop surge in 2010, an escalation that went almost unopposed by the US antiwar movement, the Taliban now retains almost as much control of the country as it did in 2001. And for that Afghanistan must be punished. Eternally, it seems.
As for Trump, in his quest to privatize as much of the federal government as possible the president is still apparently entranced with the idea of turning over much of the Afghan operation to military contractors. As McCain and Warren were issuing their war cries from Kabul, Trump and Company huddled with Erik Prince, founder of Blackwater Security, and billionaire financier Stephen Feinberg, owner of DynCorp, on how to replace US troops with mercenaries from their training camps.
Give Trump some credit. His war plan is refreshingly vacant of moral posturing. Instead he views the war through a greedily focused economic lens: Afghanistan as commodity. Over the course of 16 years, the cratering American operation in Afghanistan has consumed more than $1 trillion, a huge and nearly unchallenged benefaction to military contractors. In 2016, the Pentagon spent $3.6 million for each US soldier stationed in Afghanistan. A surge of 4,000 to 10,000 additional troops, either as "private military units" or GIs, will come as a welcome new infusion of cash to the dozens of defense corporations that invested so heavily in his administration.
The New York Time's Maggie Haberman was thrilled by some most blood-curdling lines in Trump's big speech on the war, Tweeting: "We are not nation-building again. We are killing terrorists," says POTUS, in one of his more forceful/best lines of address." All you need to do to earn the love of the "failing New York Times, " Donald, is to kill-kill-kill and not re-build what you destroy. Trump's new Afghanistan plan replicates worst aspects of Obama's awful Af-Pak strategy, with India thrown into the mix just to increase risk of nuclear war. If Trump continues with this neocon drift, HRC may get a 3 AM call from "the creep" asking her to replace Rexxon as Secretary of State .
If that living monument to the Confederacy Jefferson B. Sessions was serious about confronting the rising scourge of opiate addiction in the US, he would start by calling for an immediate end to US military operations in Afghanistan.
Forget marijuana, the real gateway to heroin abuse is war. Since the start of Operation Enduring Freedom, opium production has swelled, now accounting for more than one-third of the wrecked Afghan economy. In the last two years alone, opium poppy yields have doubled, a narcotic blowback now hitting the streets of American cities from Amarillo to Pensacola. With every drone strike in the Helmond Province, a thousand more poppies bloom.
What I'm reading this week
- Storming the Wall: Climate Change, Migration and Homeland Security by Todd Miller
- Rebel Yell: the Violence, Passion and Redemption of Stonewall Jackson by SC Gwynne
- Buried in the Bitter Waters: the Hidden History of Racial Cleansing in America by Eliot Jaspin
RIP John Abercrombie
Aug 26, 2017 | marknesop.wordpress.com
moscowexile says: August 22, 2017 at 5:25 amDrutten says: August 22, 2017 at 6:49 am
The US has sent to the Ukraine its first consignment of coal
August 22, 11:28 UTC+3
The delivery price was $113 per ton
The beginning of the end for "Novorossiya"?
I am certain that is an interpretation that the resident troll will be eager to spout out.
Не секрет, что российский энергетический уголь Киев раньше закупал по 60-70 долларов за тонну. Донбасский обходился украинцам еще дешевле. Но затем официальный Киев под предлогом "войны с Москвой" отказался от дешевых энергоресурсов.
It is no secret that Kiev used to buy Russian power station coal at $60-70 per tonne. The Donbass made even cheaper deals with the Ukrainians . But then official Kiev, on the pretext of a "war with Moscow," refused cheap energy resources.
see: На Украину отправлена первая партия дорогого угля из СШАWho's paying for it? The IMF? So the money goes back to the U.S?moscowexile says: August 22, 2017 at 6:54 am
I've seen multiple instances of this occuring in Ukraine, i.e. the purchasing of unnecessarily expensive goods, with money they technically don't have. It's not always a "Russian substitution" thing either.
Somebody's laughing all the way to the bank, at least. Good on them.Somebody's laughing all the way to the bankmarknesop says: August 22, 2017 at 9:38 am
Swinish squeals of laughter coming from him above, that's for sure.
Furthermore, the pig is laughing all the way to the bank that he owns.That's their privilege. And they will be able to exercise it, in theory, for so long as the western taxpayer is prepared to see the IMF allot Ukraine money to buy energy at prices far higher than it could obtain it elsewhere. I daresay in the meantime someone else will buy Donbas coal. It's not like this is going to break them. Although the USA will pocket the taxpayers' money – again – which is one of its preferred ways of doing business.
Aug 25, 2017 | marknesop.wordpress.com
August 23, 2017
Lyttenburgh , August 23, 2017 at 9:51 pm" seem to be smart enough not to concentrate in one region. "
Uh-huh. Thanks for update, et Al! Just recently the Ukrian Foreign ministry revealed data pertaining to the "success" of the Sacred BezViz. They claim that 200 000 of the Ukrainians used it since its inception on 11 June this year. How much is it compared to other years – I have no data ATM. The №1 destination place of these tourists surprised me – it's Barcelona! Second place hold Rome, third one – Paris, 4 – Milan, 5 – Lissabon Not Poland and not Germany though.
Meanwhile rumours abound about "New Europeans" (mostly – from the Baltic states) illegally transporting Ukrainians to Ireland and Britain to work as literally slaves there. Also there was a general noise about the increase of the Ukrainian gasterbaiters in Poland.
The idea that Germany should pay is not a new one. PiS just tries to make Poland enter the elite club of the "suffering nations", browbeat the entire world into accepting their own unique "tragic history" and then beg for monies. Their mistake is twofold. First – they disperse their energy and attention at many "tragedies" at once. Look at Israel and the Ukraine! They get this martyrology business model right – focus on one event (Shoah/Holodomor) and proclaim it as unique and reparations worthy.
And what the PiS does? Kaczynski has suggested to have a monthly anniversary of the Smolensk crash to be hosted in April 2018; for a grand total of 96 months (the number of victims). He also expressed a hopeful notion that "we will learn the truth by then" (aka "Tusk/KGB did it!").
Each progressive monthly anniversary costs more to field and takes more policemen to act as security. It is siad, that the previous monthlyversary required 2000 policemen for about 2.5 thousand people and about 500 people from the countermanifestation. First monthlyversaries only had 50 or so policemen standing guard.
Aug 16, 2017 | www.unz.com
Interview with Vlado Plaga in the German magazine FAIRCONOMY, September 2017.
Originally, you didn't want to become an economist. How did it come that you changed your plans and digged so deep into economics?
I found economics aesthetic, as beautiful as astronomy. I came to New York expecting to become an orchestra conductor, but I met one of the leading Wall Street economists, who convinced me that economics and finance was beautiful.
I was intrigued by the concept of compound interest. and by the autumnal drain of money from the banking system to move the crops at harvest time. That is when most crashes occurred. The flow of funds was the key.
I saw that there economic cycles were mainly financial: the build-up of debt and its cancellation or wipe-out and bankruptcy occurring again and again throughout history. I wanted to study the rise and fall of financial economies.
But when you studied at the New York University you were not taught the things that really interested you, were you?
I got a PhD as a union card. In order to work on Wall Street, I needed a PhD. But what I found in the textbooks was the opposite of everything that I experienced on Wall Street in the real world. Academic textbooks describe a parallel universe. When I tried to be helpful and pointed out to my professors that the texbooks had little to do with how the economy and Wall Street actually work, that did not help me get good grades. I think I got a C+ in money and banking.
So I scraped by, got a PhD and lived happily ever after in the real world.
So you had to find out on your own Your first job was at the Savings Banks Trust Company, a trust established by the 127 savings banks that still existed in New York in the 1960s. And you somehow hit the bull's eye and were set on the right track, right from the start: you've been exploring the relationship between money and land. You had an interesting job there. What was it?
Savings banks were much like Germany's Landesbanks. They take local deposits and lend them out to home buyers. Savings and Loan Associations (S&Ls) did the same thing. They were restricted to lending to real estate, not personal loans or for corporate business loans. (Today, they have all been turned into commercial banks.)
I noticed two dynamics. One is that savings grew exponentially, almost entirely by depositors getting dividends every 3 months. So every three months I found a sudden jump in savings. This savings growth consisted mainly of the interest that accrued. So there was an exponential growth of savings simply by inertia.
The second dynamic was that all this exponential growth in savings was recycled into the real estate market. What has pushed up housing prices in the US is the availability of mortgage credit. In charting the growth of mortgage lending and savings in New York State, I found a recycling of savings into mortgages. That meant an exponential growth in savings to lend to buyers of real estate. So the cause of rising real estate prices wasn't population or infrastructure. It was simply that properties are worth whatever banks are able and willing to lend against them.
As the banks have more and more money, they have lowered their lending standards.
It's kind of automatic, it's just a mathematical law
Yes, a mathematical law that is independend of the economy. In other words, savings grow whether or not the economy is growing. The interest paid to bondholders, savers and other creditors continues to accrue. That turns out to be the key to understanding why today's economy is polarizing between creditors and debtors.
You wrote in " Killing the Host " that your graphs looked like Hokusai's "Great Wave off Konagawa" or even more like a cardiogram. Why?
Any rate of interest has a doubling time. One way or another any interest-bearing debt grows and grows. It usually grows whenever interest is paid. That's why it looks like a cardiogram: Every three months there's a jump. So it's like the Hokusai wave with a zigzag to reflect the timing of interest payments every three months.
The exponential growth of finance capital and interest-bearing debt grows much faster then the rest oft he economy, which tends to taper off in an S-curve. That's what causes the business cycle to turn down. It's not really a cycle, it's more like a slow buildup like a wave and then a sudden
This has been going on for a century. Repeated financial waves build up until the economy becomes so top-heavy with debt that it crashes. A crash used to occur every 11 years in the 19th century. But in the United States from 1945 to 2008, the exponential upswing was kept artificially long by creating more and more debt financing. So the crash was postponed until 2008.
Most crashes since the 19th century had a silver lining: They wiped out the bad debts. But this time the debts were left in place, leading to a masive wave of foreclosures. We are now suffering from debt deflation. Instead of a recovery, there's just a flat line for 99% of the economy.
The only layer of the economy that is growing is the wealthiest 5% layer – mainly the Finance, Insurance and Real Estate (FIRE) sector. That is, creditors living of interest and economic rent: monopoly rent, land rent and financial interest. The rest of the economy is slowly but steadily shrinking.
And the compound interest that was accumulated was issued by the banks as new mortgages. Isn't this only logical for the banks to do?
Savings banks and S&Ls were only allowed to lend for mortgages. Commercial banks now look for the largest parts of the economy as their customers. Despite the fact that most economic textbooks describe industry and manufacturing as being the main part of economy, real estate actually is the largest sector. So most bank lending is against real estate and, after that, oil, gas and mining.
That explains why the banking and financial interests have become the main lobbyists urging that real estate, mining and oil and gas be untaxed – so that there'll be more economic rent left to pay the banks. Most land rent and natural resource rent is paid out as interest to the banks instead of as taxes to the government.
So instead of housing becoming cheaper and cheaper it turns out to be much less affordable in our days than in the 1960s?
Credit creation has inflated asset prices. The resulting asset-price inflation is the distinguishing financial feature of our time. In a race tot he bottom, banks have steadily lowered the terms on which they make loans. This has made the eocnomy more risky.
In the 1960s, banks required a 25-30% down payment by the buyer, and limited the burden of mortgage debt service to only 25% of the borrower's income. But interest is now federally guaranteed up to 43% of the home buyer's income. And by 2008, banks were making loans no down payment at all. Finally, loans in the 1960s were self-amortizing over 30 years. Today we have interest-only loans that are never paid off.
So banks loan much more of the property's market price. That is why most of the rental value of land isn't paid to the homeowner or commercial landlord any more. It's paid to the banks as interest.
Was this the reason for the savings and loan crisis that hit the US in 1986 and that was responsible for the failure of 1,043 out of the 3,234 savings and loan associations in the United States from 1986 to 1995?
The problem with the savings and loan crisis was mainly fraud! The large California S&L's were run by crooks, topped by Charles Keating. Many were prosecuted for fraud and sent to jail. By the 1980s the financial sector as a whole had become basically a criminalized sector. My colleague Bill Black has documented most of that. He was a prosecutor of the S&L frauds in the 1980s, and wrote a book "The best way to rob a bank is to own one".
That's a famous quotation, I also heard that.
Fraud was the main financial problem, and remains so.
Since 2007 Americans were strangled by their mortgages in the sub-prime crisis
These were essentially junk mortgages, and once again it was fraud. Already in 2004 the FBI said that the American economy was suffering the worst wave of bank fraud in history. Yet there was no prosecution. Essentially in the United States today, financial fraud is de-criminalized. No banker has been sent to jail, despite banks paying hundreds of billions of dollars of fines for financial fraud. These fines are a small portion of what they took illegally. Such paymets are merely a cost of doing business. The English language was expanded to recognize junk loans. Before the financial crash the popular press was using the word "junk mortgages" and "Ninjas": "No Income, No Jobs, no Assets". So everybody knew that there was fraud, and the bankers knew they would not go to jail, because Wall Street had become the main campaign contributer to the leading politicians, especially in the Democratic party. The Obama Administration came in basically as representatives of the bank fraudsters. And the fraud continues today. The crooks have taken over the banking system. It is hard for Europeans to realize that that this really has happened in America. The banks have turned into gangsters, which is why already in the 1930s President Roosevelt coined the word "banksters".
I also heard the nice English sayings "Too big to fail" or "Too big to jail"
But what has become of those 10 million households that ended up losing their homes to foreclosure? How are their economic and living conditions today? What has become of their houses? The economy has recovered
Most of the houses that were foreclosed on have been bought out by hedge funds for all cash. In the wake of 2008, by 2009 and 2010 hedge funds were saying "If you have $5,000,000 to invest, we're going to buy these houses that are being sold at distress prices. We're going to buy foreclosed properties for all cash, because we can make a larger rate of return simply by renting them out." So there has been a transfer of property from homeowners to the financial sector. The rate of home-ownership in America is dropping.
The economy itself has not recovered. All economic growth since 2008 has accrued only to the top 5% of the economy. 95% of the economy has been shrinking by about 3% per year and continues to shrink, because the debts were kept in place. President Obama saved the banks and Wall Street instead of saving the economy.
That's why we live in an "age of deception" as the sub-title of your latest book suggests, I guess?
"People have the idea that when house prices go up, somehow everybody's getting richer. And it's true that the entry to the middle class for the last hundred years has been to be able to own your own home "
What is deceptive is the fact that attention is distracted away from how the real world works, and how unfair it is. Economics textbooks teach that the economy is in equilibrium and is balanced. But every economy in the world is polarizing between creditors and debtors. Wealth is being sucked up to the top of the economic pyramid mainly by bondholders and bankers. The textbooks act as if the economy operates on barter. Nobel prices for Paul Samuelson and his followers treat the economy as what they call the "real economy," which is a fictitious economy that in theory would work without money or debt. But that isn't the real economy at all. It is a parallel universe. So the textbooks talk about a parallel universe that might exist logically, but has very little to do with how the real economy works in today's world.
If you had a picture you'd see me nodding all the time, because that's what I also found out: if you look at the mathematics, it is polarizing all the time, it is de-stabilizing. Without government interference we'd have crash after crash It is not under control anymore.
But you also suggest that there's another factor that makes housing prices go up – and that's property tax cuts. Why?
"Taxes were shifted off the Donald Trumps of the world and onto homeowners ."
Whatever the tax collector relinquishes leaves more rental income available to be paid to the banks. Commercial real estate investors have a motto: "Rent is for paying interest." When buyers bid for an office building or a house, the buyer who wins is the one who is able to get the largest bank loan. And that person is the one who pays all the rent to the bank. The reason why commercial investors were willing to do this for so many decades is that they wanted to get the capital gain – which really was the inflation of real estate prices as a result of easier credit. But now that the economy is "loand up," prospects for further capital gains are gone. So the prices are not rising much anymore. There is no reason to be borrowing. So the system is imploding.
So, how could we change the situation and make land a public utility?
There are two ways to do this. One way is to fully tax the land's rental value. Public investment in infrastructure – roads, schools, parks, water and sewer systems – make a location more desirable. A subway line, like the Jubilee tube line in London, increases real estate prices all along the line. The resulting rise in rents increases prices for housing. This rental value could be taxed back by the community to pay for this infrastructure. Roads and subways, water and sewer systems could be financed by re-capturing the rental value of the land that this public investment creates. But that is not done. A free lunch is left in private hands.
The alternative is direct public ownership of the land, which would be leased out to whatever is deemed to be most socially desirable, keeping down the rental cost. In New York City, for instance, restaurants and small businesses are being forced out. They're closing down because of the rising rents. The character of the economy is changing. It is getting rid of the bookstores, restaurants and low-profit enterprises. Either there should be a land tax, or public ownership of the land. Those are the alternatives. If you tax away the land's rent, it would not be available to be paid to the banks. You could afford to cut taxes on labor. You could cut the income tax, and you could cut taxes on consumption. That would reduce the cost of living.
To me that's pretty close to the position of Georgists on how to handle land, isn't it?
I don't like to mention Henry George, because he didn't have a theory of land rent or of the role of the financial sector and debt creation. The idea of land tax came originally from the Physiocrats in France, François Quesnay, and then from Adam Smith, John Stuart Mill, and in America from Thorstein Veblen and Simon Patten . All of these economists clarified the analysis of land rent, who ended up with it, and how it should be taxed. In order to have a theory of how much land rent there is to tax, you need a value and price theory. Henry George's value theory was quite confused. Worst of all, he spent the last two decades of his life fighting against socialists and labor reformers. He was an irascible journalist, not an economist.
The classical economists wrote everything you need to know about land rent and tax policy. That was the emphasis of Adam Smith, John Stuart Mill all the classical economists. The purpose of their value and price theory was to isolate that part of the economy's income that was unearned: economic rent, land rent, monopoly rent, and financial interest. I think it is necessary to put the discussion of tax policy and rent policy back in this classical economic context. Henry George was not part of that. He was simply a right-wing journalist whom libertarians use to promote neoliberal Thatcherite deregulation and anti-government ideology. In Germany, his followers were among the first to support the Nazi Party already in the early 1920s, for instance, Adolf Damaschke. Anti-Semitism also marked George's leading American followers in the 1930s and ‚40s.
So I guess I have to go back a bit further in history, to read the original Physiocrats as well
John Stuart Mill is good, Simon Patten is good, Thorstein Veblen is wonderful. Veblen was writing about the financialization of real estate in the 1920s in his Absentee Ownership . I recently edited a volume on him: Absentee Ownership and its Discontents (ISLET, Dresden, 2016).
Germany's land tax reform seems to go in the wrong direction. Germany has to establish new rules for it's "Grundsteuer" that in fact is a mingled tax on land and the buildings standing on it, based on outdated rateable values of 1964 (in the West) and 1935 (in the East). The current reform proposals of the federal states will maintain this improper mingling and intend a revenue neutral reform of this already very low tax. It brings about 11 billion Euro to the municipal authorities, but this is only 2% of the total German tax revenue, whereas wage tax and sales tax make up for 25% each. We need a complete tax shift, don't we?
Germany is indeed suffering from rising housing prices. I think there are a number of reasons for this. One is that Germans have not had a real estate bubble like what occurred in the US or England. They did lose money in the stock market, and many decided simply to put their money in their own property. There is also a lot of foreign money coming into Germany to buy property, especially in Berlin.
The only way to keep housing prices down is to tax awat the rise in the land value. If this is done, speculators are not going to buy. Only homeowners or commercial users will buy for themselves. You don't want speculators or bank credit to push up prices. If Germany lets its housing prices rise, it is going to price its labor out of the market. It would lose its competitive advantage, because the largest expense in every wage-earner's budget is the cost of housing. In Ricardo's era it was food; today it is housing. So Germany should focus on how to keep its housing prices low.
I'd like to come back to the issue of interest once more. The English title of "Der Sektor" is " Killing the host – How Financial Parasites and Debt Bondage Destroy the Global Economy". It's much more coming to the point. It struck me that you mention John Brown. He wrote a book called "Parasitic wealth or Money Reform" in 1898. I came across his book some years ago and thought that he was somehow America's Helmut Creutz of the 19th century. He was a supporter of Henry George, but in addition John Brown analyzed and criticized the interest money system and its redistribution of wealth. He said that labour is robbed of 33% of its earnings by the parasitic wealth with subtle and insideous methods, so that it's not even suspected. Why does almost nobody know this John Brown?
John Brown's book is interesting. It is somewhat like that of his contemporary Michael Flürscheim . Brown's book was published by Charles Kerr, a Chicago cooperative that also published Marx's Capital . So Brown was a part of the group of American reformers who became increasingly became Marxist in the 19 th and early 20 th century. Most of the books published by Kerr discussed finance and the exponential growth of debt.
The economist who wrote most clearly about how debt grew by its own mathematics was Marx in Vol. III of Capital and his Theories of Surplus Value . Most of these monetary writers were associated with Marxists and focused on the tendency of debt and finance to grow exponentially by purely mathematical laws, independently of the economy, not simply as a by-product of the economy as mainstream economics pretends.
So you recommend reading his book?
Sure, it is a good book, although only on one topic. Also good is Michael Flürscheim's Clue to the Economic Labyrinth (1902). So is Vol. III of Capital .
Brown's plan of reforms included the nationalization of banks and the establishment of a bank service charge in lieu of interest. The latter sounds remarkably up-to-date. In Germany the banks are raising charges because of the decrease in their interest margins. How is your view on the matter of declining interest rates?
Well, today declining interest rates are the aim of central bank Quantitative Easing. It hasn't helped. The most important questio nto ask is: what are you going to make your loans for? Most lending at these declining interest rates has been parasitic and predatory. There's a lot of corporate take-over lending to companies that borrow to buy other companies. There is an enormous amount of stock market credit that has helped bid up stock prices with low-interest credit and arbitrage. This has inflated asset prices for stocks, bonds and real estate. If the result of low interest rates is simply to inflate asset prices, the only way this can work is to have a heavy tax on capital gains, that is asset price gains. But in the US, England, and other countries there are very low taxes on capital gains, and so low interest rates simply make housing more expensive, and make stocks and buying a flow retirement income (in the form of stocks or bonds that yield dividends and interest) much more expensive.
I guess Brown is getting to the positive aspects of low interest also.
What Brown was talking about were the problems of finance. In the final analysis there is only one ultimate solution: to write down the debts. Nobody really wants to talk about debt cancellation, because they try to find a way to save the system. But it can't be fixed so that debts can keep growing at compound rates ad infinitum . Any financial system tends to end in a crash. So the key question is how a society is NOT going not to pay debts that go bad. Will it let creditors foreclose, as has occurred in the US? Or are you going to write down the debts and wipe out this overgrowth of creditor claims? That's the ultimate policy that every society has to face.
Very topical, the German Bundesbank sees the combination of low interest rates and a booming housing market as a dangerous cocktail for the banking sector. "The traffic lights have jumped to yellow or even to dark yellow", Andreas Dombret said, after the Bundesbank had denied the problem in the last years by dismissing it as Germany's legitimate catch-up effects. The residential property prices have gone up by 30% since 2010, in the major cities even by more than 60%. The share of real estate loans in the total credit portfolio is significantly rising. The mortgage loans of the households have increased in absolute terms as well as relative to their income. It's only due to the low interest rates that the debt service has not increased yet. But the banks and savings companies are taking on the risk: the mortgages with terms of more than ten years have risen to more than 40% of the residential real estate loans. The interest-change risks lie with the banks. Don't we have to face up to the truth that interest rates shouldn't go up again?
What should be raised are taxes on the land, natural resource rent and monopoly rent. The aim should be to keep housing prices low instead of speculation. Land rent should serve as the tax base, as the classical economists said it should. Adam Smith, John Stuart Mill all urged that the basis of the tax system should be real-estate and natural resource rent, not income taxes (which add to the cost of labor), the cost of labor and not value-added taxes (which increase consumer prices). So tax policy and debt write-downs today are basically the key to economic survival.
Banking should be a public utility. If you leave banking in the present hands, you're leaving it in the hands of the kind of crooks that brought about the financial crisis of 2008.
Couldn't the subprime-crisis have been prevented if the Fed had introduced negative interest rates in the 1990s?
No. The reason there was the crash was fraud and speculation. It was junk mortgages and the financialization of the economy. Pension funds and people's savings were turned over to the financial sector, whose policy is short-term. It seeks gains mainly by speculation and asset price inflation. So the problem is the financial system. I think the Boeckler foundation has annual meetings in Berlin that focus on financialization and explain what the problem is.
Yes, that's a big topic. The financial sector is interested, as you said, in short-term gains, but people who want to save for their retirement are interested in long-term stability – that is contradictory. Do you know the " Natural Economic Order by Free Land and Free Money" by Silvio Gesell
It is not practical for today's world, it is very abstract. The solution to the financial problem really has to be ultimately a debt write-down, and a shift to the tax system, as the classical economists talked about.
Gesell was also advocating the taxing of land. I think he had something in mind with bidding for the land, letting the market fix the prices.
He did not go beneath the surface to ask what kind of market do you want. Today, the market for real estate is a financialized market. As I said, the basic principle is that most rent is paid out as interest. The value of real estate is whatever a bank will lend against it. Unless you have a theory of finance and the overall economy, you really don't have a theory of the market.
You are advocating a revival of classical economics. What did the classical economists understand by a free economy?
They all defined a free economy as one that is free from land rent, free from unearned income. Many also said that a free economy had to be free from private banking. They advocated full taxation of economic rent. Today's idea of free market economics is the diametric opposite. In an Orwellian doublethink language, a free market now means an economy free for rent extractors, free for predators to make money, and essentially free for financial and corporate crime. The Obama Administration de-criminalized fraud. This has attracted the biggest criminals – and the wealthiest families – to the banking sector, because that's where the money is. Crooks want to rob banks, and the best way to rob a bank is to own one. So criminals become bankers. You can look at Iceland, at HSBC, or at Citibank and Wells-Fargo in the news today. Their repeated lawbreaking and criminal activities have been shown tob e endemic in the US. But nobody goes to jail. You can steal as much money as you want, and you'll never go to jail if you're a banker and pay off the political parties with campaign contribution. It's much like drug dealers paying off crooked police forces. So crime is pouring into the financial system.
I think this is what's going to cause a return to classical economics – the realization that you need government banks. Of course, government banks also can be corrupted, so you need some kind of checks and balances. What you need is an honest legal system. If you don't have a legal system that throws crooks in jail, your economy is going to be transformed into something unpleasant. That's what is happening today. I think that most Europeans don't want to acknowledge that that's what happened in America (USA). There is such an admiration of America that there is a hesitancy to see that it has been taken over by financial predators (a.k.a. "the market").
We always hear that oligarchies are in the east, in Russia, but hardly anyone is calling America an oligarchy although alternative media says that it's just a few families that rule the country.
Michael Hudson is the author of Killing the Host (published in e-format by CounterPunch Books and in print by Islet ). His new book is J is For Junk Economics . He can be reached at email@example.com
War for Blair Mountain > , August 16, 2017 at 2:10 pm GMTAlbertde > , August 16, 2017 at 2:46 pm GMT
It is absolutely urgent that Richard Spencer and the Alt Right adopt the ideas and framework of Michael Hudson and and Ha Joon Chang(Kicking away the ladder.)
Support Socialism!!!=violation of free market principles
Pinochet=Neoliberal free market terrorism!!!Linda Green > , August 16, 2017 at 11:04 pm GMT
It is always a joy to read Michael Hudson but he is always discreetly incomplete as he never discusses the role of the privately owned US Federal Reserve, the other privately owned central banks and the BIS (Bank for International Settlements), which collectively force governments to borrow money from their central bank in order to create new money instead of these governments unilaterally creating the money themselves as they theoretically could.Si1ver1ock > , August 16, 2017 at 11:43 pm GMT
@Albertde It is always a joy to read Michael Hudson but he is always discreetly incomplete as he never discusses the role of the privately owned US Federal Reserve, the other privately owned central banks and the BIS (Bank for International Settlements), which collectively force governments to borrow money from their central bank in order to create new money instead of these governments unilaterally creating the money themselves as they theoretically could. This is a good point.
I believe Hitler made the same point, but due to our education consisting of largely being told what to think, rather than being taught how to think, we have had it pounded into our heads that such ideas as monetary sovereignty only come out of the minds of truly evil men. We are repeatedly told the only way to prevent Weimar style inflation is to run our economy as we presently do, no improvements are possible and to even consider such is a sign of sociopathology. Our betters for some reason want the children of the white stock that founded the country to hate themselves and become submissive to the advancing immigrant hordes while our politicians figure out ways to sell off large chunks of our infrastructure, like our roads for instance, so they can they can charge us and all the new immigrants they are letting in to drive on them.
Hell, just last week they taught a group of white men a good lesson when they tried to peaceably assemble to protest about their grievances. The media & leftist politicians (both Dem & Republican) teamed up on an alternative story of the event and allowed a group of paid communist thugs to come in and beat them while the media reported the white group to be the aggressor.
If I didn't know better, I would swear the United States has been taken over by a hostile globalist elite, that cares not one bit for the natives of our country.
Exciting times are ahead in our nation, this is for sure.
As to Michael Hudson's article, it is more gibberish from a lefty economist, he dances around facts but always in the end puts a disingenuous spin on it. The article is garbage and awfully loose with the facts.Linda Green > , August 17, 2017 at 12:11 am GMT
Mr. Hudson is interesting as usual. I almost always learn something new from one of his interviews. I'm not sure how "taxing the land" squares with MMT, unless he is suggesting that we should shift taxes off the middle class to free up money for circulation.
In other words, fiscal policy (taxing and spending) is part economic policy and part social policy. It's a political economy.
Here is a primer on MMT for people who haven't looked into it yet.another fred > , August 17, 2017 at 11:35 am GMT
I am familiar with MMT.
All that needs to be done at present is to change the FED's charter to allow infrastructure to be funded with some degree of monetary financing to prevent the selling off of the commons to global finance. I suggest this form of financing should only be used for maintenance of the commons, i.e. infrastructure.
All the rest will remain theoretical.
While not perfect the FED has all the tools and statistics to facilitate some level of monetary financing of infrastructure. I will take an independent federal reserve with a revised charter over selling off the commons to investors who will then charge us to use them. Funding our infrastructure the way it is presently done through congress is a joke, we need a better system, the economists at the FED are presently in a good position to speak to how best this might be accomplished. We need a plan, not a patchwork of resolutions and stop gap measures as to how the nations infrastructure will be funded.
It could be dollar matching to other funding sources, percentages, econometric models, etc. but unemployment levels and inflationary concerns would need to be considered.jacques sheete > , August 17, 2017 at 9:06 pm GMT
One does not have to project too far into the future to see that the future needs for "money" to "pay" the unfunded obligations of the Federal government are going to require some serious changes in the monetary system.
The US cannot politically survive, and therefore will not allow, a repeat of the Great Depression where economic activity collapses to the same extent it did in 1929-30 (roughly 40%).
It seems to me likely that something on the order of MMT will be followed where the government issues "money" directly rather than funding its creation through debt instruments.
I think it is naive, however, to believe that this will be some kind of panacea, a cure for all our ills. In order to institute MMT, or anything like it, the government will have to have far more power as it will have far more responsibility .
More power in the hands of fewer people – what could possibly go wrong?
https://en.wikipedia.org/wiki/Iron_law_of_oligarchyJim Bob Lassiter > , August 17, 2017 at 10:14 pm GMT
While the topic is dry one for me, Hudson makes it somewhat interesting and I like that he calls a fraud a fraud.
In fact pretty much the whole system, financial and political and all their appendages such as schools and the media, is a huge fraud. A pox on all the SOBs.
How could anyone argue against this, for instance?
Today's idea of free market economics is the diametric opposite. In an Orwellian doublethink language, a free market now means an economy free for rent extractors, free for predators to make money, and essentially free for financial and corporate crime.
I've long been impressed that what we have is not a free market, but a free-for-all market that excludes all but the richest from obtaining much by way of benefits.Brian Reilly > , August 17, 2017 at 11:50 pm GMT
I, along with many others wish we were renting an apartment instead of "owning" our house free and clear and unsellable for 50% of what I paid for it in 1993 due to my neighborhood being targeted by AFFH on steroids.
And set aside my abject racism to see how easy it is to understand why younger people (highly skilled and otherwise) with absolutely nothing resembling job security would not want to own a home when they are forced on a wholesale basis to move frequently hundreds or thousands of miles away to find another unstable replacement job.Linda Green > , August 17, 2017 at 11:53 pm GMT
An interesting but (alas ) incomplete and lop-sided view of the world. A couple comments:
The sheer size of the government apparatus (over 40% gdp in the US, more in most of the rest of the West) ensures rampant and intentional mis-allocation of capital, backed by the full police and judicial power of those various levels of government. This is an unavoidable aspect of human nature.
The fiscal and monetary fraud is no more than one aspect of many alluded to in the paragraph above. We have allowed charlatans masquerading as Utopian saviors and Paradigm Changers to capture police power to enforce laws and regulations obviously designed to shear the sheep, and reward the wolves. Too Big To Fail? More like Too Big To be Held to Account lest me and my friends and their children have to get real jobs instead of stealing from the rubes.
Last, it will be interesting to see how the debt is dealt with. It is a truly global issue, with too many people having to pledged to pay more money than can possibly be paid. It is so bad that the very accounting of the fiction has become near-impossible. Sooner or later, the accounting will become impossible, and some sort of reset (which will include a default and repudiation of most public and private debt instruments and their associated derivatives) will be agreed on? Implemented? Forced upon? By whom? Using what legal structure and in what currency denomination? Not any currency now in circulation, I think. Unclear to me, It will be fascinating to watch.Linda Green > , August 18, 2017 at 12:03 am GMT
If the options for infrastructure finance (maintenance and expansion of roads in particular) are basically:
- Soak the rich (taxes go up on the haves to pay)
- Some degree of monetary finance (money will be earned into existence rather than loaned into existence)
- Selling off the commons (the rich buy the infrastructure and charge the masses to use it)
- Continued patchwork of debt finance and can kicking
I would say monetary finance would make everyone short of the greedy asshole that wants to buy the highways happy.
I am fully aware that we have the appearance of a shortage of responsible enough parties to handle this sort of proposition. If it were widely known and the left got wind of it they would likely have brawndo water fountains on every corner. But Gary Cohn has not left the White House yet, and he is just the sort of guy that can pull something like this off through some acronym backed with hard facts and a near guarantee of success. We need to back away from socialism writ large and focus on long term sustained full employment with a gradual return to free market principles in all area of commerce.
In my economic utopia full employment and maintenance of infrastructure would be at the top of central bank or FED area of concern.
Medical care is expensive because it is subsidized and corrupted. Let the medical care bubble burst and let doctors compete for patients like other area of commerce. Until we figure out how to do that there will be no affordable medicine for the masses.Bayan > , August 18, 2017 at 1:17 pm GMT
Furthermore there is discussion in some circles of guaranteed minimum income. What a horrible idea. Let me guess, the people will drive to pick up their money on some pothole filled road, right? What a misguided notion. Can we please put off all that talk until all the roads are fixed, every tree is trimmed, every sidewalk fixed, every park glisteningly beautiful, etc until we even remotely consider it a possibility. The ghettos already give everyone free money and they line up in their own filth stepping over garbage to pick up their checks. Give me a break!in the middle > , August 18, 2017 at 4:10 pm GMT
Not every land owner is happy when roads or sewer systems are built close by. They may lose in terms of historical, cultural, and environmental values they attach to their surroundings. How are you going to compensate them? Nationalizing land does not solve this problem. One way of making people lose their attachment to a particular surrounding is to force them move every few years. But why do you want do that? To celebrate Bolshevist craziness? Why?myb6 > , August 18, 2017 at 5:45 pm GMT
@Linda Green Linda Green:
What is needed is to use a different approach when protesting. Why not call it, 'American pride parade?" Or, "love the USA parade?", others use different naming conventions when in reality its other objectives that they sought after. For example, the federal reserve act=taking over the economy of the USA. Patriot act=taking your rights away, etc. So whomever is trying to even the field in 'pride' such as the T-shirts that read: 'brown pride', 'black pride', etc. Whities should have 'American pride', and who will fight that? So then American pride=White pride, period. That will put an end to the rabid attacks from the fake news media, and all its dumb followers.TG > , August 18, 2017 at 9:50 pm GMT
Nationalizing all, or even most, land-rent only makes sense if the national government will take on the financial responsibility of funding local infrastructure, which seems like a disaster in the making.
Socializing all, or even most, land-rent even at the local level would completely destroy the balance sheets of millions of productive citizens. Cruel and arbitrary. As far as the response, "torches and pitchforks" would be understatement.
The only fair solution is to grandfather current land-rents and then tax the increment. Still discourages speculation. You could even phase-out the grandfather without destroying innocent families so long as it's gradual over a very long term, say 50 years.another fred > , August 18, 2017 at 11:08 pm GMT
A very interesting and intelligent commentary, as always from this source.
I would like to suggest that there is, in addition to what has been described here, another factor influencing rent, and that's demographics.
In the middle ages, Europe was essentially fully populated relative to its technology and infrastructure. All land was owned by a handful for wealthy families, and they could charge peasants rents so high that wages were hardly more than subsistence.
Then the Black Death came, and, unlike most plagues that quickly burned themselves out, it held the population low for generations. Suddenly the rich could not just coast on unearned interest from inherited land, because land was no longer a limiting factor. The rich tried reigning in wages via statute, but it's hard to beat supply and demand, and the rich failed. This caused the renaissance. It is little appreciated, but the physical standard of living of late medieval England was higher than many s0-called modern third-world countries
I suggest that, not in replacement of what has been mentioned here, but in addition, that demographics and population pressure also play a signficant role. When there is more land than people, it gets hard to collect rent (in the ante-bellum American South, the plantation owners had to resort to slavery. In the North, you had a lot of owner-operator farmers).
I would also think that, with a stable or slowly growing population, eventually every family pays off their mortgage, all the roads that need to get built are built, and then the children inherit, and debt goes away. A rapidly growing population means that big sums must constantly be borrowed to fund new construction and infrastructure, both public and private
And finally, I would posit that anything which reduces wages – such as too-rapid population growth – will also cause financialization, but for a different reason. I propose that in a low-wage society, where losing a job likely means a lifetime sentence of poverty, that people become wage-slaves, and beholden to their employers – and this includes economists and journalists etc. In this case only the occasional saint will take a stand on principle, and most of us are not saints. On the other hand, in a tight labor market, if an employee defies their boss (CNN, the University of Chicago, etc.), and is fired, it's not a big issue – they can easily find comparable well-paid work elsewhere.
@Si1ver1ock I would like to offer an observation about "taxing the land". In my home state property taxes are among the lowest in the nation and this is a significant political issue. I cannot offer a "correct balance," but since it is an issue that has been front and center in local politics I think I can offer some relevant observations.
Because property taxes are low in my state "persons" (including corporate) have been able to tie up large tracts for agricultural (including silvicultural) and mineral (including speculative) purposes. Most of it is in pine forest which offers very low returns and then there is the occasional mineral "jackpot" when somebody strikes oil or opens a mine (usually coal). The low tax cost means that it is not expensive to hold land for these purposes. Other beneficiaries are family farms where the land is actively worked, but does not yield a high rate of return.
While family farms are pretty bulletproof politically, there is strong opposition to the large corporate interests. The main argument against these interests has been that they inhibit "growth." Arguments "for" (besides the campaign contributions) are that we are better off with a more stable, steadily growing agricultural (silvicultural) economy as rapid "growth" creates instability, i.e. that "creative destruction" is not an unalloyed good, of which the rate should be maximized.
There IS a tendency towards old rich families, some of whom are degenerate, but some of whom are "pillars of the community" who support charitable organizations that benefit "everybody" if one thinks slower moving societies are a good thing.
My general impression is that Mr. Hudson thinks that lots of "growth" is a good thing, but he thinks he knows a better way to achieve it (better than Trump, e.g.). Obviously, since I put "growth" in scare quotes I am not sold on the idea no matter how it is achieved.
Outside the issue of "growth" there is the issue of how much a community benefits from having "pillars."
You makes your choice and you takes your chance. Personally, I don't think the universe gives a damn one way or the other – if it works, it works, if it doesn't, "batter up!"
Nature bats last.
Aug 23, 2017 | www.counterpunch.orgThe Lies on Afghanistan
by Matthew Hohby
Photo by DVIDSHUB | CC BY 2.0
There has never been progress by the U.S. military in Afghanistan, unless you are asking the U.S. military contractors or the Afghan drug barons, of whom an extremely large share are our allies in the Afghan government, militias and security forces, there has only been suffering and destruction. American politicians, pundits and generals will speak about "progress" made by the 70,000 American troops put into Afghanistan by President Obama beginning in 2009, along with an additional 30,000 European troops and 100,000 private contractors, however the hard and awful true reality is that the war in Afghanistan has only escalated since 2009, never stabilizing or deescalating; the Taliban has increased in strength by tens of thousands, despite tens of thousands of casualties and prisoners; and American and Afghan casualties have continued to grow every year of the conflict, with U.S. casualties declining only when U.S. forces began to withdraw in mass numbers from parts of Afghanistan in 2011, while Afghan security forces and civilians have experienced record casualties every year since those numbers began to be kept by the UN.
Similarly, any progress in reconstructing or developing Afghanistan has been found to be non existent despite the more than $100 billion spent by the United States on such efforts by the Special Inspector General for Afghan Reconstruction (SIGAR). $100 billion, by the way, is more money than was spent on the Marshall Plan when that post-WWII reconstruction plan is put into inflation adjusted dollars. Oft repeated claims, such as millions of Afghan school girls going to school, millions of Afghans having access to improved health care and Afghan life expectancy dramatically increasing, and the construction of an Afghan job building economy have been exposed as nothing more than public relations lies. Often displayed as modern Potemkin Villages to visiting journalists and congressional delegations and utilized to justify continued budgets for the Pentagon and USAID, and, so, to allow for more killing, like America's reconstruction program in Iraq, the reconstruction program in Afghanistan has proven to be a failure and its supposed achievements shown to be virtually non-existent, as documented by multiple investigations by SIGAR, as well as by investigators and researchers from organizations such as the UN, EU, IMF, World Bank, etc.
Tonight, the American people will hear again the great lie about the progress the American military once made in Afghanistan after "the Afghan Surge", just as we often hear the lie about how the American military had "won" in Iraq. In Iraq it was a political compromise that brought about a cessation of hostilities for a few short years and it was the collapse of the political balance that had been struck that led to the return to the violence of the last several years. In Afghanistan there has never even been an attempt at such a political solution and all the Afghan people have seen in the last eight years, every year, has been a worsening of the violence.
Americans will also hear tonight how the U.S. military has done great things for the Afghan people. You would be hard pressed to find many Afghans outside of the incredibly corrupt and illegitimate government, a better definition of a kleptocracy you will not find, that the U.S. keeps in power with its soldiers and $35 billion a year, who would agree with the statements of the American politicians, the American generals and the pundits, the latter of which are mostly funded, directly or indirectly, by the military companies. It is important to remember that for three straight elections in Afghanistan the United States government has supported shockingly fraudulent elections, allowing American soldiers to kill and die while presidential and parliamentary elections were brazenly stolen. It is also important to remember that many members of the Afghan government are themselves warlords and drug barons, many of them guilty of some of the worst human rights abuses and war crimes, the same abuses of which the Taliban are guilty, while the current Ghani government, and the previous Karzai government, have allowed egregious crimes to continue against women, including laws that allow men to legally rape their wives.
Whatever President Trump announces tonight about Afghanistan, a decision he teased on Twitter, as if the announcement were a new retail product launch or television show episode, as opposed to the somber and painful reality of war, we can be assured the lies about American progress in Afghanistan will continue, the lies about America's commitment to human rights and democratic values will continue, the profits of the military companies and drug barons will also continue, and of course the suffering of the Afghan people will surely continue.
Matthew Hoh is a member of the advisory boards of Expose Facts, Veterans For Peace and World Beyond War. In 2009 he resigned his position with the State Department in Afghanistan in protest of the escalation of the Afghan War by the Obama Administration. He previously had been in Iraq with a State Department team and with the U.S. Marines. He is a Senior Fellow with the Center for International Policy.
Aug 23, 2017 | www.theamericanconservative.com
MEOW , says: August 21, 2017 at 11:18 pmConflict Deaths and the song goes onAndrew Zook , says: August 22, 2017 at 6:02 am
American Revolutionary War 1775-1783 25,000
Northwest Indian War 1785-1795 ~1,056
Quasi-War 1798-1800 514
War of 1812 1812-1815 ~20,000
1st Seminole War 1817-1818 36
Black Hawk War 1832 305
2nd Seminole War 1835-1842 1,535
Mexican-American War 1846-1848 13,283
3rd Seminole War 1855-1858 26
American Civil War 1861-1865 ~625,000
Indian Wars 1865-1898 919
Great Sioux War 1875-1877 314
Spanish-American War 1898 2,446
Philippine-American War 1898-1913 4,196
Boxer Rebellion 1900-1901 131
Mexican Revolution 1914-1919 ~35
Haiti Occupation 1915-1934 148
World War 1 1917-1918 116,516
North Russia Campaign 1918-1920 424
American Expeditionary Force Siberia 1918-1920 328
Nicaragua Occupation 1927-1933 48
World War 2 1941-1945 405,399
Korean War 1950-1953 36,516
Vietnam War 1955-1975 58,209
El Salvador Civil War 1980-1992 37
Beirut 1982-1984 266
Grenada 1983 19
Panama 1989 40
Persian Gulf War 1990-1991 258
Operation Provide Comfort 1991-1996 19
Somalia Intervention 1992-1995 43
Bosnia 1995-2004 12
NATO Air Campaign Yugoslavia 1999 20
Operation Enduring Freedom (Afghanistan) 2001-2014 2,356
Operation Iraqi Freedom (Iraq) 2003-2012 4,489What if Trump's character and his supporters' character (lack thereof) made it easy for this to come about? I know here at TAC there was an effort to make Trump_vs_deep_state appear to be non-confrontational but Trump's a good con-man and those of us who were/are #neverTrump saw that years ago and now that he's in numerous bad spots, he'll do what humans like him (of such low character) have always done distract and posture and pick fights that kill other people in a quest to feel like a winner again God help us through this and maybe this time we'll learn our lesson.EliteCommInc. , says: August 22, 2017 at 7:22 amUhhhhhhhhhhhhhhh,
" . . . accepted a stalemate and armistice with the Chinese-backed North Koreans, and it was true again in 1975, when the U.S. suffered an ignominious defeat and 58,000 dead at the hands of pajama-clad guer