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Who Rules America ?

A slightly skeptical view on the US political establishment and foreign policy

If Ronald Reagan was America's neo-Julius Caesar, his adopted son was the first George Bush (just as J.C. adopted Augustus). And look what THAT progeny wrought. I fully expect that over the next century, no fewer than seven Bushes will have run or become president (mimicking the Roman Caesarian line). Goodbye, American Republic.

From review of Imperial America: Reflections on the United States of Amnesia by Gore Vidal

Skepticism -> Political Skeptic

News Neoliberalism Recommended books Recommended Links Libertarian Philosophy National Security State Demonization of Putin
Neoliberal Brainwashing -- Journalism in the Service of the Powerful Few US Presidential Elections of 2016 Crisis of legitimacy of neoliberal elite Anti-Russian hysteria in connection emailgate and DNC leak New American Militarism Fake News scare and US NeoMcCartyism Who Shot down Malaysian flight MH17?
Anti Trump Hysteria Predator state Two Party System as Polyarchy DNC emails leak Big Uncle is Watching You Bernie Sanders: A turncoat socialist MSM Sochi Bashing Rampage
Corporatist Corruption: Systemic Fraud under Clinton-Bush-Obama Regime American Exceptionalism American Imperialism, Transnational Capitalist Class and Globalization of Capitalism Resurgence of neofascism as reaction on crisis of neoliberalism and neoliberal globalization The Iron Law of Oligarchy Elite Theory Neo-conservatism
The Far Right Forces in Ukraine as Trojan Horse of Neoliberalism Anti-globalization movement Neoliberal corruption Fifth Column of Neoliberal Globalization Ukraine: From EuroMaydan to EuroAnschluss Fuck the EU Corporatism
Ethno-lingustic Nationalism Harvard Mafia, Andrei Shleifer and the economic rape of Russia Pathological Russophobia of the US elite Donald Trump -- an unusual fighter against excesses of neoliberal globalization Brexit as the start of the reversal of neoliberal globalization Civil war in Ukraine Obama: a yet another Neocon
IMF as the key institution for neoliberal debt enslavement Disaster capitalism Neoliberal war on reality Ayn Rand and her Objectivism Cult  Neo-Theocracy as a drive to simpler society Big Uncle is Watching You Charlie Hebdo - more questions then answers
Media-Military-Industrial Complex Color revolutions Cold War II In Foreign Events Coverage Guardian Presstitutes Slip Beyond the Reach of Embarrassment The Deep State Bureaucracy Bureaucracy as a Political Coalition
Corporatist Corruption: Systemic Fraud under Clinton-Bush-Obama Regime Neoliberalism and Christianity Neocon foreign policy is a disaster for the USA Deception as an art form Mayberry Machiavellians Immigration, wage depression and free movement of workers Russian Ukrainian Gas Wars
Audacious Oligarchy and "Democracy for Winners" Corruption of Regulators Famous quotes of John Kenneth Galbraith Kurt Vonnegut Quotes Talleyrand quotes George Carlin Otto Von Bismarck Quotes
Overcomplexity of society Paleoconservatism Non-Interventionism  Groupthink Skeptic Quotations Humor Etc

We had to struggle with the old enemies of peace — business and financial monopoly, speculation, reckless banking, class antagonism, sectionalism, war profiteering.

They had begun to consider the Government of the United States as a mere appendage to their own affairs. We know now that Government by organized money is just as dangerous as Government by organized mob.

FDR. speech after the election (1936)

polyarchy: A system where the participation of masses of people is limited to voting among one or another representatives of the elite in periodic elections. Between elections the masses are now expected to keep quiet, to go back to life as usual while the elite make decisions and run the world until they can choose between one or another elite another four years later. So polyarchy is a system of elite rule, and a system of elite rule that is little bit more soft-core than the elite rule that we would see under a military dictatorship. But what we see is that under a polyarchy the basic socio-economic system does not change, it does not become democratized.

▬William I. Robinson, Behind the Veil, Minute 1:29:15


Due to the size an introduction was converted to a separate page
Who Rules America


 


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It's easy to pretend to be a great strategist,
while sitting on the top of the hill,
at the safe distance from the battle in the valley

Shota Rustavelli(1172–1216)

[Dec 07, 2016] In view of listing on PropOrNot should

Notable quotes:
"... I was thinking Natasha Fatale .. ..."
"... it's truly amazing. many of these people have denounced joe mccarthy all their lives. ..."
"... I was thinking Katyusha. Besides being a very pretty diminutive name for Katherine, the sound of the Katyusha rockets made the forces of evil's collective sphincter tighten up. ..."
"... Just like the sound of the truth spoken to power here at NC is apparently tightening up some establishment sphincters :) ..."
"... Oh OIFVet, do you know where this line of snark is leading? Next, the NC will be "mischaracterized" as Stalin's News Organ! ..."
Dec 07, 2016 | www.nakedcapitalism.com

charles leseau November 26, 2016 at 5:36 am

So are you changing your name to Eva Smithova any time soon? Or maybe change the page header to Голый Капитализм for a bit?

a different chris November 26, 2016 at 10:37 am

Oh, I don't ask for much but please, please consider that! :) :) :)

fresno dan November 26, 2016 at 11:22 am

Re: charles leseau, November 26, 2016 at 5:36 am

I was thinking Natasha Fatale ..

petal November 26, 2016 at 1:02 pm

... Anyway, concerned by number of supposedly educated friends(Clinton supporters) being taken in by this fake news/Russian ties thing. They've lost their heads and there's no discussing it with them, they are convinced. Where does it end? Na zdorovie!

pretzelattack November 26, 2016 at 1:29 pm

it's truly amazing. many of these people have denounced joe mccarthy all their lives. somebody referred to invasion of the body snatchers on nc the other day, that's the only logical explanation.

OIFVet November 26, 2016 at 1:31 pm

I was thinking Katyusha. Besides being a very pretty diminutive name for Katherine, the sound of the Katyusha rockets made the forces of evil's collective sphincter tighten up.

Just like the sound of the truth spoken to power here at NC is apparently tightening up some establishment sphincters :)

ambrit November 26, 2016 at 4:05 pm

Oh OIFVet, do you know where this line of snark is leading? Next, the NC will be "mischaracterized" as Stalin's News Organ!

[Dec 07, 2016] Economic Growth in the United States: A Tale of Two Countries

Notable quotes:
"... Our first finding-a surge in income inequality ..."
"... Our second finding-policies to ameliorate income inequality fall woefully short ..."
"... Our third finding-comparing income inequality among countries is enlightening ..."
Dec 07, 2016 | economistsview.typepad.com
Thomas Piketty, Emmanuel Saez, Gabriel Zucman:

Economic growth in the United States: A tale of two countries, by Thomas Piketty, Emmanuel Saez, Gabriel Zucman, Equitable Growth : Overview The rise of economic inequality is one of the most hotly debated issues today in the United States and indeed in the world. Yet economists and policymakers alike face important limitations when trying to measure and understand the rise of inequality.

One major problem is the disconnect between macroeconomics and the study of economic inequality. Macroeconomics relies on national accounts data to study the growth of national income while the study of inequality relies on individual or household income, survey and tax data. Ideally all three sets of data should be consistent, but they are not. The total flow of income reported by households in survey or tax data adds up to barely 60 percent of the national income recorded in the national accounts, with this gap increasing over the past several decades. 1

This disconnect between the different data sets makes it hard to address important economic and policy questions...

A second major issue is that economists and policymakers do not have a comprehensive view of how government programs designed to ameliorate the worst effects of economic inequality actually affect inequality. Americans share almost one-third of the fruits of economic output (via taxes that help pay for an array of social services) through their federal, state, and local governments. ... Yet we do not have a clear measure of how the distribution of pre-tax income differs from the distribution of income after taxes are levied and after government spending is taken into account. This makes it hard to assess the extent to which governments make income growth more equal. 2

In a recent paper , the three authors of this issue brief attempt to create inequality statistics for the United States that overcome the limitations of existing data by creating distributional national accounts. 3 We combine tax, survey, and national accounts data to build a new series on the distribution of national income. ... Our distributional national accounts enable us to provide decompositions of growth by income groups consistent with macroeconomic growth.

In our paper, we calculate the distribution of both pre-tax and post-tax income. The post-tax series deducts all taxes and then adds back all transfers and public spending so that both pre-tax and post-tax incomes add up to national income. This allows us to provide the first comprehensive view of how government redistribution in the United States affects inequality. Our benchmark series use the adult individual as the unit of observation and split income equally among spouses in married couples. But we also produce series where each spouse is assigned their own labor income, allowing us to study gender inequality and its impact on overall income inequality. In this short summary, we would like to highlight three striking findings.

Our first finding-a surge in income inequality

First, our data show that the bottom half of the income distribution in the United States has been completely shut off from economic growth since the 1970s. ...

It's a tale of two countries. For the 117 million U.S. adults in the bottom half of the income distribution, growth has been non-existent for a generation while at the top of the ladder it has been extraordinarily strong. And this stagnation of national income accruing at the bottom is not due to population aging. ...

Our second finding-policies to ameliorate income inequality fall woefully short

Our second main finding is that government redistribution has offset only a small fraction of the increase in pre-tax inequality. ...

Our third finding-comparing income inequality among countries is enlightening

Third, an advantage of our new series is that it allows us to directly compare income across countries. Our long-term goal is to create distributional national accounts for as many countries as possible; all the results will be made available online on the World Wealth and Income Database . One example of the value of these efforts is to compare the average bottom 50 percent pre-tax incomes in the United States and France. 8 In sharp contrast with the United States, in France the bottom 50 percent of real (inflation-adjusted) pre-tax incomes grew by 32 percent from 1980 to 2014, at approximately the same rate as national income per adult. While the bottom 50 percent of incomes were 11 percent lower in France than in the United States in 1980, they are now 16 percent higher. (See Figure 3.) ... Since the welfare state is more generous in France, the gap between the bottom 50 percent of income earners in France and the United States would be even greater after taxes and transfers.

The diverging trends in the distribution of pre-tax income across France and the United States-two advanced economies subject to the same forces of technological progress and globalization-show that working-class incomes are not bound to stagnate in Western countries. In the United States, the stagnation of bottom 50 percent of incomes and the upsurge in the top 1 percent coincided with drastically reduced progressive taxation, widespread deregulation of industries and services, particularly the financial services industry, weakened unions, and an eroding minimum wage.

Conclusion

Given the generation-long stagnation of the pre-tax incomes among the bottom 50 percent of wage earners in the United States, we feel that the policy discussion at the federal, state, and local levels should focus on how to equalize the distribution of human capital, financial capital, and bargaining power rather than merely the redistribution of national income after taxes. Policies that could raise the pre-tax incomes of the bottom 50 percent of income earners could include:

The different levels of government in the United States today obviously have the power to make income distribution more unequal, but they also have the power to make economic growth in America more equitable again. Potentially pro-growth economic policies should always be discussed alongside their consequences for the distribution of national income and concrete ways to mitigate their unequalizing effects. We hope that the distributional national accounts we present today can prove to be useful for such policy evaluations. ...

Posted by Mark Thoma on Tuesday, December 6, 2016 at 12:30 PM in Economics , Income Distribution | Permalink Comments (37)

View blog reactions

--> -->
Comments Feed You can follow this conversation by subscribing to the comment feed for this post. pgl : , December 06, 2016 at 12:37 PM

Gabriel Zucman is doing excellent work on this issue as well as how the rich shift income offshore to tax havens.
pgl : , December 06, 2016 at 12:39 PM
"Reforms of labor market institutions to boost workers' bargaining power and including a higher minimum wage"

The argument for this just gets stronger and stronger. Alas, I do not trust Trump to push for this agenda. I hope my distrust is misplaced.

Denis Drew -> pgl... , December 06, 2016 at 02:44 PM
Progressive states can push it on their own -- re-constituting union density locally. Just need to add some dimension of enforcement to what the NLRB helplessly considers illegal -- actually protect employees right to organize commercially.

http://ontodayspage.blogspot.com/2016/11/first-100-days-progressive-states-agenda.html

sanjait -> pgl... , December 06, 2016 at 02:54 PM
"Alas, I do not trust Trump to push for this agenda. I hope my distrust is misplaced."

I would hold out no hope for this. Trumputin is not going to empower the people vs the oligarchs. You can with high confidence expect he will do the opposite.

Paul Mathis -> pgl... , December 06, 2016 at 03:35 PM
Fox Noise Viewers and Trump Voters

Are the folks in the bottom half who are getting screwed over. They blame the Mexicans and Chinese for their fates. They made their choice, let them live with it.

The Rage : , December 06, 2016 at 12:43 PM
This is just capitalism.
DrDick -> The Rage... , December 06, 2016 at 12:46 PM
No, it is unjust capitalism (redundant, I know).
The Rage -> DrDick... , December 06, 2016 at 01:00 PM
All capitalism is "unjust".
pgl -> The Rage... , December 06, 2016 at 01:43 PM
You left out the key line "workers of the world unite". Yep - I'm on a unionization drive.
Peter K -> pgl... , December 06, 2016 at 01:54 PM
Then why were you for Hillary over Sanders? Doesn't make sense.

Did PGL get woke???

LOL

Or is it just that a Republican is in the White House?

pgl -> Peter K... , December 06, 2016 at 02:34 PM
Snore!
DrDick -> The Rage... , December 06, 2016 at 02:40 PM
As I said, redundant.
anne : , December 06, 2016 at 12:45 PM
http://www.nytimes.com/2016/12/06/business/economy/a-bigger-economic-pie-but-a-smaller-slice-for-half-of-the-us.html

December 6, 2016

Economic Pie Grows, but Half of U.S. Gets Smaller Slice
By PATRICIA COHEN

In 35 years, the U.S. economy has more than doubled, but new research shows close to zero growth for working-age adults in the bottom 50 percent of income.

Fred C. Dobbs -> anne... , December 06, 2016 at 12:50 PM
A Bigger Economic Pie, but a Smaller Slice
for Half of the U.S. http://nyti.ms/2hdlnuU
NYT - PATRICIA COHEN - December 6

Even with all the setbacks from recessions, burst bubbles and vanishing industries, the United States has still pumped out breathtaking riches over the last three and half decades.

The real economy more than doubled in size; the government now uses a substantial share of that bounty to hand over as much as $5 trillion to help working families, older people, disabled and unemployed people pay for a home, visit a doctor and put their children through school.

Yet for half of all Americans, their share of the total economic pie has shrunk significantly, new research has found.

This group - the approximately 117 million adults stuck on the lower half of the income ladder - "has been completely shut off from economic growth since the 1970s," the team of economists found. "Even after taxes and transfers, there has been close to zero growth for working-age adults in the bottom 50 percent."

The new findings, by the economists Thomas Piketty, Emmanuel Saez and Gabriel Zucman, provide the most thoroughgoing analysis to date of how the income kitty - like paychecks, profit-sharing, fringe benefits and food stamps - is divided among the American population.

Inequality has been a defining national issue for nearly a decade, thanks in part to groundbreaking research done by Mr. Piketty at the Paris School of Economics and Mr. Saez at the University of California, Berkeley.

But now a new administration in Washington is promising to reshape the government's role in curbing the intense concentration of wealth at the top and improving the fortunes of those left behind.

During his tenure in the White House, President Obama pushed to address income stagnation by shifting more of the tax burden from the middle class to the rich and expanding public programs like universal health insurance.

Both strategies are now targeted by President-elect Donald J. Trump and Republicans in Congress, led by House Speaker Paul Ryan. Like many conservatives, Mr. Ryan argues that aid to the poor is ultimately counterproductive because it undermines the incentive to work. Proposals put forward by Republican leaders, though short on details, make clear that they want to roll back benefits like Medicaid and the Affordable Care Act, which primarily help the poor, and direct the largest tax cuts to the wealthiest Americans.

About 30 percent of the country's income is channeled to federal, state and local taxes. Apart from military spending and performing basic public services, much of that is distributed back to individuals through various programs and tax benefits in the form of Social Security checks, Medicare benefits and veterans' benefits. But until now, no one has truly measured the full impact that tax payments, government spending, noncash benefits and nontaxable income together have on inequality.

Abundant documentation of income inequality already exists, but it has been challenged as incomplete. Studies have excluded the impact of taxes and value of public benefits, skeptics complained, or failed to account for the smaller size of households over time.

This latest project tries to address those earlier criticisms. What the trio of economists found is that the spectacular growth in incomes at the peak has so outpaced the small increase at the bottom from public programs intended to ameliorate poverty and inequality that the gap between the wealthiest and everyone else has continued to widen.

Stagnant wages have sliced the share of income collected by the bottom half of the population to 12.5 percent in 2014, from 20 percent of the total in 1980. Where did that money go? Essentially, to the top 1 percent, whose share of the nation's income nearly doubled to more than 20 percent during that same 34-year period.

Average incomes grew by 61 percent. But nearly $7 out of every additional $10 went to those in the top tenth of the income scale.

Inequality has soared over that period. In 1980, the researchers found, someone in the top 1 percent earned on average $428,200 a year - about 27 times more than the typical person in the bottom half, whose annual income equaled $16,000.

Today, half of American adults are still pretty much earning that same $16,000 on average - in 1980 dollars, adjusted for inflation - while members of the top 1 percent now bring home $1,304,800 - 81 times as much.

That ratio, the authors point out, "is similar to the gap between the average income in the United States and the average income in the world's poorest countries, the war-torn Democratic Republic of Congo, Central African Republic and Burundi."

The growth of incomes has probably increased a bit since 2014, the latest year for which full data exists, said Mr. Zucman, who, like Mr. Saez, also teaches at the University of California, Berkeley. But it is "not enough to make any significant difference to our long-run finding, and in particular, to affect the long-run stagnation of bottom-50-percent incomes." ...

DrDick : , December 06, 2016 at 12:46 PM
Damn, it is even worse than I thought, and I thought I was a pessimist.
sanjait -> DrDick... , December 06, 2016 at 02:55 PM
Yup, hard not to get discouraged in these times...
anne : , December 06, 2016 at 12:49 PM
http://www.nytimes.com/2016/12/06/business/economy/a-dilemma-for-humanity-stark-inequality-or-total-war.html

December 6, 2016

A Dilemma for Humanity: Stark Inequality or Total War
By EDUARDO PORTER

Drawing on history, Walter Scheidel of Stanford argues in a coming book that only all-out war might fundamentally alter how resources are distributed.

Fred C. Dobbs -> anne... , December 06, 2016 at 01:05 PM
(Thinking the unthinkable.)

NYT: Is there nothing to be done about galloping inequality?

Last year the typical American family experienced the fastest income gains since the government started measuring them in the 1960s. But the top 1 percent did even better, raising their share of income higher than it was when President Obama took office.

Mr. Obama has led the most progressive administration since Lyndon B. Johnson's half a century ago, raising taxes on the rich to expand the safety net for the less fortunate. Still, by the White House's own account, eight years of trench warfare in Washington trimmed the top 1-percenters' share, after taxes and transfers, to only 15.4 percent, from 16.6 percent of the nation's income. It increased the slice going to the poorest fifth of families by 0.6 percentage point, to a grand total of 4 percent.

The policies also helped push the Republican Party even further to the right, leading to the Tea Party - whose rabid opposition to government redistribution still shakes American politics. They did nothing to salve - and perhaps even added to - the stewing resentment of white working-class Americans who feel left out of the nation's advancements, producing the electoral victory for Donald J. Trump, who has proposed a tax plan that amounts to a lavish giveaway to the rich.

The point is not that President Obama should have done better. He probably did the best he could under the circumstances. The point is that delivering deep and lasting reductions in inequality may be impossible absent catastrophic events beyond anything any of us would wish for.

History - from Ancient Rome through the Gilded Age; from the Russian Revolution to the Great Compression of incomes across the West in the middle of the 20th century - suggests that reversing the trend toward greater concentrations of income, in the United States and across the world, might be, in fact, nearly impossible.

That's the bleak argument of Walter Scheidel, a professor of history at Stanford, whose new book, "The Great Leveler" (Princeton University Press), is due out next month. He goes so far as to state that "only all-out thermonuclear war might fundamentally reset the existing distribution of resources." If history is anything to go by, he writes, "peaceful policy reform may well prove unequal to the growing challenges ahead."

Professor Scheidel does not offer a grand unified theory of inequality. But scouring through the historical record, he detects a pattern: From the Stone Age to the present, ever since humankind produced a surplus to hoard, economic development has almost always led to greater inequality. There is one big thing with the power to stop this dynamic, but it's not pretty: violence. ...

Fred C. Dobbs -> Fred C. Dobbs... , December 06, 2016 at 01:40 PM
Hmmm. At some point, the powers that
be may want to organize a gigantic
apocalyptical world-wide conflict
that does NOT go nuclear because
that would be Really Excessive.
mrrunangun -> Fred C. Dobbs... , December 06, 2016 at 02:10 PM
After his success in the Red- White civil war, Lenin began the destruction of the hereditary rich and the educated professional classes in the Soviet Union. Executions were common as were slower deaths in work camps ridden with lice and typhus. He had to cut back on the pace of destruction after a few years because he found he could not run the country without technical experts and so some of the engineers, doctors, professors, etc were allowed to live out their days and care for some of their impoverished relatives. A book on the subject, "Former People" gives details of the methods used for selecting and liquidating the pre-revolutionary Elite. Not for the squeamish.
anne : , December 06, 2016 at 12:51 PM
http://gabriel-zucman.eu/files/PSZ2016.pdf

December 2, 2016

Distributional National Accounts: Methods and Estimates for the United States
By Thomas Piketty, Emmanuel Saez, and Gabriel Zucman

Abstract

This paper combines tax, survey, and national accounts data to estimate the distribution of national income in the United States since 1913. Our distributional national accounts capture 100% of national income, allowing us to compute growth rates for each quantile of the income distribution consistent with macroeconomic growth. We estimate the distribution of both pre-tax and post-tax income, making it possible to provide a comprehensive view of how government redistribution affects inequality. Average pre-tax national income per adult has increased 60% since 1980, but we find that it has stagnated for the bottom 50% of the distribution at about $16,000 a year. The pre-tax income of the middle class- adults between the median and the 90th percentile-has grown 40% since 1980, faster than what tax and survey data suggest, due in particular to the rise of tax-exempt fringe benefits. Income has boomed at the top: in 1980, top 1% adults earned on average 27 times more than bottom 50% adults, while they earn 81 times more today. The upsurge of top incomes was first a labor income phenomenon but has mostly been a capital income phenomenon since 2000. The government has offset only a small fraction of the increase in inequality. The reduction of the gender gap in earnings has mitigated the increase in inequality among adults. The share of women, however, falls steeply as one moves up the labor income distribution, and is only 11% in the top 0.1% today.

anne -> anne... , December 06, 2016 at 03:34 PM
http://gabriel-zucman.eu/files/PSZ2016.pdf

December 2, 2016

Distributional National Accounts: Methods and Estimates for the United States
By Thomas Piketty, Emmanuel Saez, and Gabriel Zucman

Conclusion

This paper has combined tax, survey, and national accounts data to build series on the distribution of total National Income in the United States since 1913. Our "Distributional National Accounts" estimates capture 100% of National Income and hence provide decompositions of growth by income groups consistent with macroeconomic economic growth. We compute both pre-tax and post-tax series. Post-tax series deduct all taxes and add back all transfers and public spending so that they also aggregate to total National Income. We find an overall U-shape for pre-tax and post-tax income concentration over the century. The surge in income concentration since the 1970s was first a labor income phenomenon but has been mostly a capital income phenomenon since 2000. Since 1980, growth in real incomes for the bottom 90% adults has been only about half of the national average on pre-tax basis and about two-thirds on a post-tax basis. Median pre-tax incomes have hardly grown since 1980. The reduction of the gender gap in earnings has played an important role in mitigating the increase in inequality among adults since the late 1960s but the gender gap is far from being closed especially at the upper earnings end. Tax progressivity at the top has declined since the 1960s but the generosity of transfers at the bottom has increased hereby mitigating the dramatic worsening in inequality.

Our objective is to extend the methods developed in this paper to as many countries as possible in the coming years. The ultimate goal is to be able to compare inequality across countries and over time rigorously. Just like we use GDP or national income to compare the macroeconomic performance of countries today, so could distributional national accounts be used to compare inequality tomorrow. We also hope that our work can contribute to foster international collaborations between academics and statistical institutes in order to produce more and more consistent and systematic "Distributional national accounts." The same methodology is currently being applied and extended to more countries.

Peter K : , December 06, 2016 at 01:18 PM
"Given the generation-long stagnation of the pre-tax incomes among the bottom 50 percent of wage earners in the United States, we feel that the policy discussion at the federal, state, and local levels should focus on how to equalize the distribution of human capital, financial capital, and bargaining power rather than merely the redistribution of national income after taxes."

Krugman:

"So what would a political manifesto aimed at winning over these voters look like? You could promise to make their lives better in ways that don't involve bringing back the old plants and mines - which, you know, Obama did with health reform and Hillary would have done with family policies and more. But that apparently isn't an acceptable answer."

Chris Dillow:

"I have a slightly different beef. It's that this form of centrism offers too etiolated a vision of equality. Inequality isn't simply a matter of pay packets but of power too. Centrism fails to tackle the latter. This is a big failing not least because policies to increase productivity might require greater equality of power in the workplace – something which technocratic centrism has long ignored."

sanjait -> Peter K... , December 06, 2016 at 02:59 PM
It's really easy to say we should "equalize" before tax outcomes, but notably, the authors don't even attempt to say with specificity how to do that.

Not that it isn't a worthwhile endeavor, but when everyone saying we should do it fails to say how to do it, it shows there are neither obvious answers nor long hanging fruit.

It should be noted though that in addition to after tax stuff like Obamacare and family support policies, mainstream Dems like Obama and Clinton also support education at all levels and ages and working bargaining through a friendly NLRB, which fall right into the categories the paper authors specified.

Got better ideas? The world needs them.

pgl -> sanjait... , December 06, 2016 at 03:07 PM
One idea is to counter monopsony power in the labor market by increasing wage floors. But when I suggest this - baby poor PeterK gets confused (he has no idea what we are talking about as usual) so he gets all MAD.
Peter K : , December 06, 2016 at 01:41 PM
"You could promise to make their lives better in ways ... which, you know, Obama did with health reform and Hillary would have done with family policies and more."

Gotta love that "and more."

Boosting the safety net a tiny little bit does help with bargaining power but not much.

Democrats have to be much more bold and explicit - like Bernie Sanders was - or Trump is just going to win again in 2020.

It's not enough for Democrats to just be better than Republicans (even as Obama pushes the TPP). That's a very low bar.

sanjait -> Peter K... , December 06, 2016 at 03:00 PM
ACA and Hillary's family support policies were huge.

Calling those "a little bit" shows you're one of those faux progressives who wants a "revolution" but really doesn't appreciate how actual government policies affect actual working peoples' lives.

pgl -> sanjait... , December 06, 2016 at 03:08 PM
"faux progressives". Bingo! But give PeterK a break - understanding how the real world works gets in the way of his day job - hurling insults.
Peter K : , December 06, 2016 at 01:46 PM
"Given the generation-long stagnation of the pre-tax incomes among the bottom 50 percent of wage earners in the United States, we feel that the policy discussion at the federal, state, and local levels should focus on how to equalize the distribution of human capital, financial capital, and bargaining power rather than merely the redistribution of national income after taxes."

People have no right complain! They're just being racist and nostalgic for old days of white male hetero Christian privilege.

EMichael wants to purge all of the Bernie Sanders voters who voted for Hillary in the general.

He equates them with Susan Sarandon and Jill Stein, since they didn't like Hillary.

When EMichael would defend centrist Bill Clinton and Obama's etiolated record of progressivism, he'd argue that FDR and LBJ had large marjorities of Democrats.

Yeah but back then FDR and LBJ had to work with and compromise with racist Democrats from the South in Congress.

That's why they New Deal and War on Poverty was imperfect but it was a lot better than what Bill Clinton or Obama left behind.

Peter K -> Peter K... , December 06, 2016 at 01:50 PM
http://www.cc.com/full-episodes/np0e6l/the-daily-show-with-trevor-noah-december-5--2016---van-jones-season-22-ep-22032

Last night's Daily Show.

Van Jones is 15 minutes in.

sanjait -> Peter K... , December 06, 2016 at 03:02 PM
Peter K ... light on policy, but heavy on grudges. Epitomizing the more-progressive-than-thou crowd.
pgl -> sanjait... , December 06, 2016 at 03:09 PM
Wow - concise and to the point writing. I should take a writing class from you.
Denis Drew : , December 06, 2016 at 02:40 PM
" coincided with drastically reduced progressive taxation, widespread deregulation of industries and services, particularly the financial services industry, weakened unions, and an eroding minimum wage "

"weakened unions?"

Read disappeared unions. 6% union density in private industry is analogous to 20/10 blood pressure -- it starves every other healthy economic and political process.

Re-constitute union density and unions will be your social cop on every corner -- goodbye "reduced progressive tax, dereged industries and services espec' financial and the eroded minimum wage."
****************************
Just happened to post this somewhere else today -- talk about eroded!!!!!!!!!!!!

dbl-indexed is for inflation and per capita income growth -- 2013 dollars:

yr..per capita...real..(nominal)..dbl-index...%-of
68...15,473....10.74..(1.60)......10.74......100%
69-70-71-72-73
74...18,284.....9.43...(2.00)......12.61
75...18,313.....9.08...(2.10)......12.61
76...18,945.....9.40...(2.30)......13.04........72%
77
78...20,422.....9.45...(2.65)......14.11
79...20,696.....9.29...(2.90)......14.32
80...20,236.....8.75...(3.10)......14.00
81...20,112.....8.57...(3.35)......13.89........62%
82-83-84-85-86-87-88-89
90...24,000.....6.76...(3.80)......16.56
91...23,540.....7.26...(4.25)......16.24........44%
92-93-94-95
96...25,887.....7.04...(4.75)......17.85
97...26,884.....7.46...(5.15)......19.02........39%
98-99-00-01-02-03-04-05-06
07...29,075.....6.56...(5.85)......20.09
08...28,166.....7.07...(6.55)......19.45
09...27,819.....7.86...(7.25)......19.42........40%
10-11-12-13-14-15-16

If we could have foretold to Americans of 1968 that by early 2007 the minimum wage would have dropped almost in half in real terms (instead of almost tripling in real terms to keep up with national productivity gains) -- what could they have possibly guessed: a comet strike, a limited nuclear exchange, multiple world plagues?

sanjait : , December 06, 2016 at 03:06 PM
Good and important stuff.

Decomposed data is tremendously valuable, and making it publicly available for many countries is a huge service.

I will again note that this piece falls into the category of diagnosing-but-not-proposing-anything-specific-to-address-the-problem, from which we are seeing many pieces of commentary these days, but I think it's a useful part of the process to collectively go through this realization phase.

But these authors take a good half-step forward in proposing a useful framework for the *types* of policies that would be helpful. And it's a very good framework (I say with bias, because it's the same one i've long had). That's also worth something, in addition to the invaluable contribution of data.

pgl -> sanjait... , December 06, 2016 at 03:12 PM
Having real world data that would illuminate progressive issues is indeed a useful contribution. But those faux progressives would just call our praise for this hard yet important work centrist neoliberal elitism. Yes - they love their pointless labels as it makes actual analysis so obsolete.
llisa2u2 : , December 06, 2016 at 03:45 PM
How about "CAPS" on all top federal positions- presidents, vice-presidents,cabinet members, senators, representatives. There needs to be Federal and STATE "CAPS" established across the US. "CAPS" on University president wages, University coaches wages, etc. etc. THEN, minimize all the pensions that the present 5 ex-Presidents are still getting, security guards, upkeep and expense on homes etc. etc. The US citizens are really being forced to support a closed ARISTOCRACY. Just start a list of all the extra-perks that the ARISTOCRACY are receiving. Some are receiving benefits to sons, daughter, cousins, close relatives etc. etc. Just how much $$$ is given to 20 year-olds that haven't worked except through patronage positions, because of "cronies" giving them a job because of immediate family connections. The mess of political patronage on the Federal and State levels need to be discussed and dissected. If Us taxpayers had to bail out private investors, insurance companies and hedge-funds because of the TBTF fiasco, then let these companies that were bailed out come to the focus on just how much churning, and bad investment advise occurred that enabled the rape WORKERS in civil-service jobs across the US. Come on MSM and MSE start revealing the behind-the-scenes patronage that has sucked the $$ from the general public. The $$$ was sucked into the DC swamp by the Left, the Right, and the In-Betweeners that hide beyond the snow-job propaganda messages to the GP.
llisa2u2 : , -1
One sentence should include the words:.... the rape of WORKERS PENSIONS.......
Just side note, the old European guilds, and unions KNEW what they were doing in their organizational structures and why. The majority of US workers today don't have a clue. Too many blue collar and white collar workers have been suckered by the New Boss, who's exactly the same as the Old Boss, if not worse!

[Dec 07, 2016] The Pentagon's "2015 Strategy" for Ruling the World Global Research - Centre for Research on Globalization

Notable quotes:
"... On Wednesday, the Pentagon released its 2015 National Military Strategy, a 24-page blueprint for ruling the world through military force. While the language in the report is subtler and less incendiary than similar documents in the past, the determination to unilaterally pursue US interests through extreme violence remains the cornerstone of the new strategy. Readers will not find even a hint of remorse in the NMS for the vast destruction and loss of life the US caused in countries that posed not the slightest threat to US national security. Instead, the report reflects the steely resolve of its authors and elite constituents to continue the carnage and bloodletting until all potential rivals have been killed or eliminated and until such time that Washington feels confident that its control over the levers of global power cannot be challenged. ..."
"... lives in Washington state. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion (AK Press). Hopeless is also available in a Kindle edition . He can be reached at fergiewhitney@msn.com . ..."
Dec 07, 2016 | www.globalresearch.ca
Mike Whitney

By Mike Whitney Global Research, December 06, 2016 Counter Punch 3 July 2016 Theme: Militarization and WMD , US NATO War Agenda pentagone

On Wednesday, the Pentagon released its 2015 National Military Strategy, a 24-page blueprint for ruling the world through military force. While the language in the report is subtler and less incendiary than similar documents in the past, the determination to unilaterally pursue US interests through extreme violence remains the cornerstone of the new strategy. Readers will not find even a hint of remorse in the NMS for the vast destruction and loss of life the US caused in countries that posed not the slightest threat to US national security. Instead, the report reflects the steely resolve of its authors and elite constituents to continue the carnage and bloodletting until all potential rivals have been killed or eliminated and until such time that Washington feels confident that its control over the levers of global power cannot be challenged.

As one would expect, the NMS conceals its hostile intentions behind the deceptive language of "national security". The US does not initiate wars of aggression against blameless states that possess large quantities of natural resources. No. The US merely addresses "security challenges" to "protect the homeland" and to "advance our national interests." How could anyone find fault with that, after all, wasn't the US just trying to bring peace and democracy to Afghanistan, Iraq, Libya and now Syria?

In the Chairman's Forward, Joint Chiefs of Staff Gen. Martin Dempsey attempts to prepare the American people for a future of endless war:

Future conflicts will come more rapidly, last longer, and take place on a much more technically challenging battlefield. We must be able to rapidly adapt to new threats while maintaining comparative advantage over traditional ones the application of the military instrument of power against state threats is very different than the application of military power against non state threats. We are more likely to face prolonged campaigns than conflicts that are resolved quickly that control of escalation is becoming more difficult and more important. ( Document: 2015 U.S. National Military Strategy , USNI News)

War, war and more war. This is the Pentagon's vision of the future. Unlike Russia or China which have a plan for an integrated EU-Asia free trade zone (Silk Road) that will increase employment, improve vital infrastructure, and raise living standards, the US sees only death and destruction ahead. Washington has no strategy for the future, no vision of a better world. There is only war; asymmetrical war, technological war, preemptive war. The entire political class and their elite paymasters unanimously support global rule through force of arms. That is the unavoidable meaning of this document. The United States intends to maintain its tenuous grip on global power by maximizing the use of its greatest asset; its military.

And who is in the military's gunsights? Check out this excerpt from an article in Defense News:

The strategy specifically calls out Iran, Russia and North Korea as aggressive threats to global peace. It also mentions China, but notably starts that paragraph by saying the Obama administration wants to "support China's rise and encourage it to become a partner for greater international security," continuing to thread the line between China the economic ally and China the regional competitor.

None of these nations are believed to be seeking direct military conflict with the United States or our allies," the strategy reads. "Nonetheless, they each pose serious security concerns which the international community is working to collectively address by way of common policies, shared messages, and coordinated action. ( Pentagon Releases National Military Strategy , Defense News)

Did you catch that last part? "None of these nations are believed to be seeking direct military conflict with the United States or our allies. Nevertheless, they each pose serious security concerns."

In other words, none of these countries wants to fight the United States, but the United States wants to fight them. And the US feels it's justified in launching a war against these countries because, well, because they either control vast resources, have huge industrial capacity, occupy an area of the world that interests the US geopolitically, or because they simply want to maintain their own sovereign independence which, of course, is a crime. According to Dempsey, any of these threadbare excuses are sufficient justification for conflict mainly because they "pose serious security concerns" for the US, which is to say they undermine the US's dominant role as the world's only superpower.

The NMS devotes particular attention to Russia, Washington's flavor-of-the-month enemy who had the audacity to defend its security interests following a State Department-backed coup in neighboring Ukraine. For that, Moscow must be punished. This is from the report:

Some states, however, are attempting to revise key aspects of the international order and are acting in a manner that threatens our national security interests. While Russia has contributed in select security areas, such as counternarcotics and counterterrorism, it also has repeatedly demonstrated that it does not respect the sovereignty of its neighbors and it is willing to use force to achieve its goals. Russia's military actions are undermining regional security directly and through proxy forces. These actions violate numerous agreements that Russia has signed in which it committed to act in accordance with international norms. (2015 NMS)

Russia is an evildoer because Russia refused to stand by while the US toppled the Ukrainian government, installed a US stooge in Kiev, precipitated a civil war between the various factions, elevated neo Nazis to positions of power in the security services, plunged the economy into insolvency and ruin, and opened a CIA headquarters in the Capital to run the whole shooting match. This is why Russia is bad and must be punished.

But does that mean Washington is seriously contemplating a war with Russia?

Here's an excerpt from the document that will help to clarify the matter:

For the past decade, our military campaigns primarily have consisted of operations against violent extremist networks. But today, and into the foreseeable future, we must pay greater attention to challenges posed by state actors. They increasingly have the capability to contest regional freedom of movement and threaten our homeland. Of particular concern are the proliferation of ballistic missiles, precision strike technologies, unmanned systems, space and cyber capabilities, and weapons of mass destruction (WMD) technologies designed to counter U.S. military advantages and curtail access to the global commons. (2015 NMS)

It sounds to me like the Washington honchos have already made up their minds. Russia is the enemy, therefore, Russia must be defeated. How else would one "counter a revisionist state" that "threatens our homeland"?

Why with Daisy Cutters, of course. Just like everyone else.

The NMS provides a laundry list of justifications for launching wars against (imaginary) enemies of the US. The fact is, the Pentagon sees ghosts around every corner. Whether the topic is new technologies, "shifting demographics" or cultural differences; all are seen as a potential threat to US interests, particularly anything related to the "competition for resources." In this skewed view of reality, one can see how the invasion of Iraq was justified on the grounds that Saddam's control of Iraq's massive oil reserves posed a direct challenge to US hegemony. Naturally, Saddam had to be removed and over a million people killed to put things right and return the world to a state of balance. This is the prevailing view of the National Military Strategy, that is, that whatever the US does is okay, because its the US.

Readers shouldn't expect to find something new in the NMS. This is old wine in new bottles. The Pentagon has merely updated the Bush Doctrine while softening the rhetoric. There's no need to scare the living daylights out of people by talking about unilateralism, preemption, shrugging off international law or unprovoked aggression. Even so, everyone knows that United States is going to do whatever the hell it wants to do to keep the empire intact. The 2015 National Military Strategy merely confirms that sad fact.

Mike Whitney lives in Washington state. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion (AK Press). Hopeless is also available in a Kindle edition . He can be reached at fergiewhitney@msn.com .

The original source of this article is Counter Punch Copyright © Mike Whitney , Counter Punch , 2016

[Dec 06, 2016] Mattis on Our Way of War

Dec 06, 2016 | www.theamericanconservative.com
General Mattis reportedly spoke of his concerns during discussions over attacking Iran and thus fell afoul of the Washington establishment, so President Obama hastened his retirement. Foreign Policy 's Thomas Ricks reported :

Why the hurry? Pentagon insiders say that he rubbed civilian officials the wrong way-not because he went all "mad dog," which is his public image, and the view at the White House, but rather because he pushed the civilians so hard on considering the second- and third-order consequences of military action against Iran. Some of those questions apparently were uncomfortable. Like, what do you do with Iran once the nuclear issue is resolved and it remains a foe? What do you do if Iran then develops conventional capabilities that could make it hazardous for U.S. Navy ships to operate in the Persian Gulf? He kept saying, "And then what?"

Washington did have a "strategy" when it attacked Iraq, the neoconservative one. This was to intimidate the Muslim world with massive bombing, "Shock and Awe" we called it, so all Muslims would be afraid of us and then do what we ordered. Then we planted giant, billion-dollar American air bases in Iraq and Afghanistan. These would, they thought, give us hegemony over Central Asia, intimidate Russia and Iran, while Iraq would turn into a friendly, modern democracy dependent upon Washington. Other Muslim nations would then follow with democratic regimes which would co-operate and obey Washington's plans.

With the neocons discredited, no other strategy has replaced theirs except to "win" and come home. This is not unusual in our history. In past wars American "strategy" has usually been to return to the status quo ante, the prewar situation. Washington violates nearly all of Sun Tzu's dictums for success. Endless wars for little purpose and with no end strategy are thus likely to continue. They are, however, profitable or beneficial for many Washington interests.

[Dec 06, 2016] What the demand for recount tells us about Jill Stein?

Dec 06, 2016 | www.moonofalabama.org
jfl | Dec 3, 2016 5:54:00 PM | 31

A Bare-Knuckle Fight Over Recounts

Since recounts that overturn the vote totals seem unlikely, it appears the Clinton campaign's Plan B is to use any evidence of tampering that it can pin on Russia to lobby electors to change their votes to Clinton when the Electoral College meets in state capitals on Dec. 19.

Finding evidence of hacking of election computers that can somehow be blamed on Russia could be crucial for the Clinton team in their effort to convince electors to change their vote.

Laurence Tribe, a well-known and connected Democratic lawyer, has offered to defend pro bono any elector who breaks the law by changing their vote to Clinton. And there are plans to mount a constitutional challenge against the 26 states that legally bind the electors' to their state's popular vote.


Jill Stein's willingness to provide cover for 'the Russians hacked the election' recounts is interesting ...

Exhibit A in Stein's petition is an affidavit from Professor J. Alex Halderman, a professor of computer science at the University of Michigan, who alleges that Russia hacked the election.

Exhibit B from Stein's petition is an article from Wired Magazine about Russia's alleged role in the hack.

Exhibit C is a New York Times article quoting DellSecureWorks, a private security firm, saying Russia was behind the hack of Clinton campaign chairman John Podesta.

Exhibits D through G - meaning all of Stein's exhibits - are on alleged Russian hacking. One article is about an alleged attempted Russian hack of the 2014, post-coup Ukrainian election.


... although I think it unlikely that 'the Russians hacked the election' it does look likely that the authors of that 'meme' managed to get Jill Stein to carry their water for them. Why did she do that? Did she even read the petition - that drew $7 million in funding overnight - before signing it? What does it say about her if she didn't? What does it say about her if she did?

What does it say about her that she went for such a lose-lose proposition?

Can an actual run on the electoral college be in the works? Can that be the 'reasoning' behind Jeff Bezos' ProPornoTeam?

[Dec 06, 2016] Complex political intrigue around Syria

Dec 06, 2016 | www.moonofalabama.org
virgile | Dec 3, 2016 6:20:04 PM | 34

While Bashar al Assad has not created ISIS whose roots are in humiliated Saddam Hossein Sunni generals and soldiers, it is obvious that he did not prevent them from infiltrating the 'rebels'. He wanted a clash between the 'rebels' mostly inspired by the Moslem Brotherhood (who has "succeeded" in Libya, Egypt and Tunisia) and with other Sunni Islamists who had a more extreme ideology.

The 'rebels' ( later taken over by Al Nusra) were funded by Qatar and Turkey ( fans of the MB) while the Salafists ( later ISIS) originated in Iraq, Pakistan and other countries were funded by Saudi Arabia.

Bashar al Assad threw them face to face in order to weaken them. Its quite possible that he managed to keep their dissension alive by sometime executing one side to get a violent response of the other. That was a very smart strategy. He helped transforming the 'moderate' rebels into violent fighters motivated by money and revenge that soon were labelled terrorists by the Western world.

The war was had threefold: Salafists against Moslem Brotherhood, and both against the Syrian army. As the funds and support the Islamist were getting from Saudi Arabia, Qatar, Kuwait and Turkey were unlimited, the Syrian army found itself in a dire situation, despite the help from Arab Shia militias. The intervention of Russia changed the whole picture. Later the Kurdish factor has weakened Turkey further and the failed Yemen war made Saudi Arabia less generous with the 'rebels'. Only Qatar has continued to fund them.

Thus Bashar al Assad may have benefited from the emergence of ISIS in the beginning but he was about to be overrun without Russia and Iran's support.
For Russia and Iran, the fall of Bashar al Assad meant the massacre of the Shia, Alawites and Christians and violent struggle between the two extremist Islamist factions ( MB and Salafists) with incompatible ideology.

It was clear that Bashar al Assad should not be allowed to be toppled and they acted accordingly independently of the civilian casualties.

jfl | Dec 3, 2016 6:53:29 PM | 36
Aleppo has sent the West into Panic Overdrive

The delirious state of the ruling European elites has been displayed on public when the Guardian published their last demand:

'European leaders, notably the French, are privately warning Vladimir Putin that if he permits Syria's president, Bashar al-Assad, to turn an expected capture of Aleppo into a military victory across most of the country, it will be up to Russia to foot the bill for reconstruction.'

It looks that those in power in London, Paris, Berlin are completely brain dead, since they seem to be unable to recall who destroyed Iraq, Libya, Syria, Afghanistan and a number of other countries.

The United States, with the avid support provided by the EU, have killed hundreds of thousands of civilians, while destroying the homes and the infrastructure that supported those that they spared, which resulted in a veritable exodus of migrants from the Middle East and Africa to Europe.

So, maybe they should be paying the bills instead of forcing smaller European countries to provide shelter for the refugees they created in the first place.

And what about Washington's responsibility?


Let's see ...

- If the US hires the Israelis to build a wall on the Mexican border, and the Mexicans should pay for it, and
- If the US uses NATO to surround Russia and to start a war with that country, and the Europeans should pay for it - and fight it
- Then Europeans should welcome the refugees from the USraeli/USaudi wars in the Middle East and USropean wars in NA as well, right?

Trumpian logic 101.

I don't think Trump's counterparts in Europe are going to see it that way, once they're elected as he was, out the revulsion of the population with USropean policies that have left them financially devastated, bankrupts themselves.

Maybe China should pay? Right.

Maybe the Saudis and the GCC should pay ... they paid to destroy the ME, might they not be compelled to pay to put it back together again? Seems like a Trumpian solution to me. I imagine he can get his up and coming counterparts in Europe to go along with that.

[Dec 06, 2016] What price the new democracy Goldman Sachs conquers Europe

Dec 06, 2016 | independent.co.uk
&Stephen Foley

November 17, 2011 | The Independent

While ordinary people fret about austerity and jobs, the eurozone's corridors of power have been undergoing a remarkable transformation

The ascension of Mario Monti to the Italian prime ministership is remarkable for more reasons than it is possible to count. By replacing the scandal-surfing Silvio Berlusconi, Italy has dislodged the undislodgeable. By imposing rule by unelected technocrats, it has suspended the normal rules of democracy, and maybe democracy itself. And by putting a senior adviser at Goldman Sachs in charge of a Western nation, it has taken to new heights the political power of an investment bank that you might have thought was prohibitively politically toxic.

This is the most remarkable thing of all: a giant leap forward for, or perhaps even the successful culmination of, the Goldman Sachs Project.

It is not just Mr Monti. The European Central Bank, another crucial player in the sovereign debt drama, is under ex-Goldman management, and the investment bank's alumni hold sway in the corridors of power in almost every European nation, as they have done in the US throughout the financial crisis. Until Wednesday, the International Monetary Fund's European division was also run by a Goldman man, Antonio Borges, who just resigned for personal reasons.

Even before the upheaval in Italy, there was no sign of Goldman Sachs living down its nickname as "the Vampire Squid", and now that its tentacles reach to the top of the eurozone, sceptical voices are raising questions over its influence. The political decisions taken in the coming weeks will determine if the eurozone can and will pay its debts – and Goldman's interests are intricately tied up with the answer to that question.

Simon Johnson, the former International Monetary Fund economist, in his book 13 Bankers, argued that Goldman Sachs and the other large banks had become so close to government in the run-up to the financial crisis that the US was effectively an oligarchy. At least European politicians aren't "bought and paid for" by corporations, as in the US, he says. "Instead what you have in Europe is a shared world-view among the policy elite and the bankers, a shared set of goals and mutual reinforcement of illusions."

This is The Goldman Sachs Project. Put simply, it is to hug governments close. Every business wants to advance its interests with the regulators that can stymie them and the politicians who can give them a tax break, but this is no mere lobbying effort. Goldman is there to provide advice for governments and to provide financing, to send its people into public service and to dangle lucrative jobs in front of people coming out of government. The Project is to create such a deep exchange of people and ideas and money that it is impossible to tell the difference between the public interest and the Goldman Sachs interest.

Mr Monti is one of Italy's most eminent economists, and he spent most of his career in academia and thinktankery, but it was when Mr Berlusconi appointed him to the European Commission in 1995 that Goldman Sachs started to get interested in him. First as commissioner for the internal market, and then especially as commissioner for competition, he has made decisions that could make or break the takeover and merger deals that Goldman's bankers were working on or providing the funding for. Mr Monti also later chaired the Italian Treasury's committee on the banking and financial system, which set the country's financial policies.

With these connections, it was natural for Goldman to invite him to join its board of international advisers. The bank's two dozen-strong international advisers act as informal lobbyists for its interests with the politicians that regulate its work. Other advisers include Otmar Issing who, as a board member of the German Bundesbank and then the European Central Bank, was one of the architects of the euro.

Perhaps the most prominent ex-politician inside the bank is Peter Sutherland, Attorney General of Ireland in the 1980s and another former EU Competition Commissioner. He is now non-executive chairman of Goldman's UK-based broker-dealer arm, Goldman Sachs International, and until its collapse and nationalisation he was also a non-executive director of Royal Bank of Scotland. He has been a prominent voice within Ireland on its bailout by the EU, arguing that the terms of emergency loans should be eased, so as not to exacerbate the country's financial woes. The EU agreed to cut Ireland's interest rate this summer.

Picking up well-connected policymakers on their way out of government is only one half of the Project, sending Goldman alumni into government is the other half. Like Mr Monti, Mario Draghi, who took over as President of the ECB on 1 November, has been in and out of government and in and out of Goldman. He was a member of the World Bank and managing director of the Italian Treasury before spending three years as managing director of Goldman Sachs International between 2002 and 2005 – only to return to government as president of the Italian central bank.

Mr Draghi has been dogged by controversy over the accounting tricks conducted by Italy and other nations on the eurozone periphery as they tried to squeeze into the single currency a decade ago. By using complex derivatives, Italy and Greece were able to slim down the apparent size of their government debt, which euro rules mandated shouldn't be above 60 per cent of the size of the economy. And the brains behind several of those derivatives were the men and women of Goldman Sachs.

The bank's traders created a number of financial deals that allowed Greece to raise money to cut its budget deficit immediately, in return for repayments over time. In one deal, Goldman channelled $1bn of funding to the Greek government in 2002 in a transaction called a cross-currency swap. On the other side of the deal, working in the National Bank of Greece, was Petros Christodoulou, who had begun his career at Goldman, and who has been promoted now to head the office managing government Greek debt. Lucas Papademos, now installed as Prime Minister in Greece's unity government, was a technocrat running the Central Bank of Greece at the time.

Goldman says that the debt reduction achieved by the swaps was negligible in relation to euro rules, but it expressed some regrets over the deals. Gerald Corrigan, a Goldman partner who came to the bank after running the New York branch of the US Federal Reserve, told a UK parliamentary hearing last year: "It is clear with hindsight that the standards of transparency could have been and probably should have been higher."

When the issue was raised at confirmation hearings in the European Parliament for his job at the ECB, Mr Draghi says he wasn't involved in the swaps deals either at the Treasury or at Goldman.

It has proved impossible to hold the line on Greece, which under the latest EU proposals is effectively going to default on its debt by asking creditors to take a "voluntary" haircut of 50 per cent on its bonds, but the current consensus in the eurozone is that the creditors of bigger nations like Italy and Spain must be paid in full. These creditors, of course, are the continent's big banks, and it is their health that is the primary concern of policymakers. The combination of austerity measures imposed by the new technocratic governments in Athens and Rome and the leaders of other eurozone countries, such as Ireland, and rescue funds from the IMF and the largely German-backed European Financial Stability Facility, can all be traced to this consensus.

"My former colleagues at the IMF are running around trying to justify bailouts of €1.5trn-€4trn, but what does that mean?" says Simon Johnson. "It means bailing out the creditors 100 per cent. It is another bank bailout, like in 2008: The mechanism is different, in that this is happening at the sovereign level not the bank level, but the rationale is the same."

So certain is the financial elite that the banks will be bailed out, that some are placing bet-the-company wagers on just such an outcome. Jon Corzine, a former chief executive of Goldman Sachs, returned to Wall Street last year after almost a decade in politics and took control of a historic firm called MF Global. He placed a $6bn bet with the firm's money that Italian government bonds will not default.

When the bet was revealed last month, clients and trading partners decided it was too risky to do business with MF Global and the firm collapsed within days. It was one of the ten biggest bankruptcies in US history.

The grave danger is that, if Italy stops paying its debts, creditor banks could be made insolvent. Goldman Sachs, which has written over $2trn of insurance, including an undisclosed amount on eurozone countries' debt, would not escape unharmed, especially if some of the $2trn of insurance it has purchased on that insurance turns out to be with a bank that has gone under. No bank – and especially not the Vampire Squid – can easily untangle its tentacles from the tentacles of its peers. This is the rationale for the bailouts and the austerity, the reason we are getting more Goldman, not less. The alternative is a second financial crisis, a second economic collapse.

Shared illusions, perhaps? Who would dare test it?

[Dec 06, 2016] Another Neoliberal politician bites the dust

Dec 06, 2016 | www.moonofalabama.org
&Debsisdead | Dec 4, 2016 7:50:41 PM | 106

and Another Neoliberal bites the dust

News outta Italy is also good Matteo Renzi's attempt to amend the constitution to make the government rather than the entire legislature (both houses) powerful enough to change laws has gone down in a screaming prang. Matteo Renzi has to resign since that is what he promised, and just for a change the populist replacement doesn't appear to be an islamophonic fascist.

[Dec 06, 2016] Why is the USA addicted to war?

www.moonofalabama.org
ben | Dec 3, 2016 2:01:32 PM | 10

http://www.addictedtowar.com/ read the books online. don't let the books format fool you, massive thought, with footnotes.

Penelope | Dec 3, 2016 11:47:02 PM | 59

Ben @ 10, it's not the USA that's addicted to war. Rather it is the US govt AS CAPTURED BY THE OLIGARCHS. Nor is it truly an addiction, but a means to the end of a global oligarchy. It isn't enough to see the evil of US aggression. One must also understand why the international institutions which have usurped nationhood around the world are evil: Fed/IMF system, World Bank, WTO and the entire UN system to which they belong. US hegemony has never been intended as the endgame. Oligarchical global govt is-- initially as a decentralized administration which they are already trying to sell you as "multipolarity".

[Dec 06, 2016] Cheney, the Neocons and China

If conflict with China is inevitable, it does not make sense to increase hostility with Russia. Why neocons are doing that?
Notable quotes:
"... I've hesitated about whether to apply the word "neoconservative" to persons like Bush, Cheney and Rumsfeld. I tend to follow the Christian Science Monitor lis t. Paul Wolfowitz, Libby, Douglas Feith, Richard Perle, Richard Bolton, and Elliott Abrams are intellectuals absorbed in the project of using U.S. military power to remake the Middle East to improve Israel's long-term security interests. (Hannah, David Wurmser, Eric Edelman, and other White House staffers not on the Monitor's dated list also fall into this category.) ..."
"... Ultimate decision-makers Bush, Cheney and Rumsfeld on the other hand are sometimes referred to as "aggressive nationalists." They are no doubt Christian Zionists, but are probably most interested in transforming the "Greater Middle East" in the interests of corporate America in an increasingly competitive world. They're probably more concerned about the geopolitics of oil and the placement of "enduring" military bases to "protect U.S. interests" than the fate of Israel. ..."
"... They are equipped with a philosophical outlook that justifies the use of hyped, imagined threats to unite the masses behind rulers' objectives and ambitions, to suppress dissent and control through fear. They're inclined to identify each new target as "a new Hitler," and to justify their actions as " an answer to the Holocaust ." ..."
"... "The true measure of how powerful the vice president's office remains today is whether the United States chooses to confront Iran and Syria or to seek diplomatic solutions. For the moment, at least, the war party led by Dick Cheney remains in ascendancy." ..."
www.counterpunch.org

I've hesitated about whether to apply the word "neoconservative" to persons like Bush, Cheney and Rumsfeld. I tend to follow the Christian Science Monitor list. Paul Wolfowitz, Libby, Douglas Feith, Richard Perle, Richard Bolton, and Elliott Abrams are intellectuals absorbed in the project of using U.S. military power to remake the Middle East to improve Israel's long-term security interests. (Hannah, David Wurmser, Eric Edelman, and other White House staffers not on the Monitor's dated list also fall into this category.)

Ultimate decision-makers Bush, Cheney and Rumsfeld on the other hand are sometimes referred to as "aggressive nationalists." They are no doubt Christian Zionists, but are probably most interested in transforming the "Greater Middle East" in the interests of corporate America in an increasingly competitive world. They're probably more concerned about the geopolitics of oil and the placement of "enduring" military bases to "protect U.S. interests" than the fate of Israel.

Dreyfuss' article suggests that Cheney (and thus, the administration) sees China as the biggest long-term threat to those interests.

If conflict with China is inevitable,

Because

(1) that vision fits in perfectly with the broader New World Order and U.S. plans to contain China, and

(2) the neocons as a coordinated "persuasion" if not movement, with their fingers in a dozen right-wing think tanks, and the Israel Lobby including its Christian Right component, and the academic community, are well-placed to serve as what Dreyfuss calls "acolytes."

They are equipped with a philosophical outlook that justifies the use of hyped, imagined threats to unite the masses behind rulers' objectives and ambitions, to suppress dissent and control through fear. They're inclined to identify each new target as "a new Hitler," and to justify their actions as "an answer to the Holocaust."

They have served Cheney well, and he them so far. They're all being exposed, maybe weakened. But as Dreyfuss states at the end of his article, "The true measure of how powerful the vice president's office remains today is whether the United States chooses to confront Iran and Syria or to seek diplomatic solutions. For the moment, at least, the war party led by Dick Cheney remains in ascendancy."

GARY LEUPP is Professor of History at Tufts University, and Adjunct Professor of Comparative Religion. He can be reached at: gleupp@granite.tufts.edu

[Dec 06, 2016] Challenges for Western civilization

Dec 06, 2016 | www.moonofalabama.org
psychohistorian | Dec 3, 2016 8:02:21 PM | 46

Here is link to an interview with Stephen Hawking that I will pull some quotes from

https://www.theguardian.com/commentisfree/2016/dec/01/stephen-hawking-dangerous-time-planet-inequality

The quotes:
"
So the recent apparent rejection of the elites in both America and Britain is surely aimed at me, as much as anyone. Whatever we might think about the decision by the British electorate to reject membership of the European Union and by the American public to embrace Donald Trump as their next president, there is no doubt in the minds of commentators that this was a cry of anger by people who felt they had been abandoned by their leaders.
"
"
What matters now, far more than the choices made by these two electorates, is how the elites react. Should we, in turn, reject these votes as outpourings of crude populism that fail to take account of the facts, and attempt to circumvent or circumscribe the choices that they represent? I would argue that this would be a terrible mistake.

The concerns underlying these votes about the economic consequences of globalisation and accelerating technological change are absolutely understandable. The automation of factories has already decimated jobs in traditional manufacturing, and the rise of artificial intelligence is likely to extend this job destruction deep into the middle classes, with only the most caring, creative or supervisory roles remaining.

This in turn will accelerate the already widening economic inequality around the world. The internet and the platforms that it makes possible allow very small groups of individuals to make enormous profits while employing very few people. This is inevitable, it is progress, but it is also socially destructive.

We need to put this alongside the financial crash, which brought home to people that a very few individuals working in the financial sector can accrue huge rewards and that the rest of us underwrite that success and pick up the bill when their greed leads us astray. So taken together we are living in a world of widening, not diminishing, financial inequality, in which many people can see not just their standard of living, but their ability to earn a living at all, disappearing. It is no wonder then that they are searching for a new deal, which Trump and Brexit might have appeared to represent.
"
"
For me, the really concerning aspect of this is that now, more than at any time in our history, our species needs to work together. We face awesome environmental challenges: climate change, food production, overpopulation, the decimation of other species, epidemic disease, acidification of the oceans.

Together, they are a reminder that we are at the most dangerous moment in the development of humanity. We now have the technology to destroy the planet on which we live, but have not yet developed the ability to escape it. Perhaps in a few hundred years, we will have established human colonies amid the stars, but right now we only have one planet, and we need to work together to protect it.

To do that, we need to break down, not build up, barriers within and between nations. If we are to stand a chance of doing that, the world's leaders need to acknowledge that they have failed and are failing the many. With resources increasingly concentrated in the hands of a few, we are going to have to learn to share far more than at present.

With not only jobs but entire industries disappearing, we must help people to retrain for a new world and support them financially while they do so. If communities and economies cannot cope with current levels of migration, we must do more to encourage global development, as that is the only way that the migratory millions will be persuaded to seek their future at home.

We can do this, I am an enormous optimist for my species; but it will require the elites, from London to Harvard, from Cambridge to Hollywood, to learn the lessons of the past year. To learn above all a measure of humility.
"

[Dec 05, 2016] The Democratic Party Presidential Platform of 1996 – On Immigration

Blast from the past. Bill Clinton position on illegal immegtation.
Notable quotes:
"... Today's Democratic Party also believes we must remain a nation of laws. We cannot tolerate illegal immigration and we must stop it. For years before Bill Clinton became President, Washington talked tough but failed to act. In 1992, our borders might as well not have existed. The border was under-patrolled, and what patrols there were, were under-equipped. Drugs flowed freely. Illegal immigration was rampant. Criminal immigrants, deported after committing crimes in America, returned the very next day to commit crimes again. ..."
"... President Clinton is making our border a place where the law is respected and drugs and illegal immigrants are turned away. We have increased the Border Patrol by over 40 percent; in El Paso, our Border Patrol agents are so close together they can see each other. Last year alone, the Clinton Administration removed thousands of illegal workers from jobs across the country. Just since January of 1995, we have arrested more than 1,700 criminal aliens and prosecuted them on federal felony charges because they returned to America after having been deported. ..."
"... However, as we work to stop illegal immigration, we call on all Americans to avoid the temptation to use this issue to divide people from each other. We deplore those who use the need to stop illegal immigration as a pretext for discrimination . And we applaud the wisdom of Republicans like Mayor Giuliani and Senator Domenici who oppose the mean-spirited and short-sighted effort of Republicans in Congress to bar the children of illegal immigrants from schools - it is wrong, and forcing children onto the streets is an invitation for them to join gangs and turn to crime. ..."
Nov 30, 2016 | angrybearblog.com

What follows is from Today's Democratic Party: Meeting America's Challenges, Protecting America's Values , a.k.a., the 1996 Democratic Party Platform. This is the section on immigration. I took the liberty of bolding pieces I found interesting.

Democrats remember that we are a nation of immigrants. We recognize the extraordinary contribution of immigrants to America throughout our history. We welcome legal immigrants to America. We support a legal immigration policy that is pro-family, pro-work, pro-responsibility, and pro-citizenship , and we deplore those who blame immigrants for economic and social problems.

We know that citizenship is the cornerstone of full participation in American life. We are proud that the President launched Citizenship USA to help eligible immigrants become United States citizens. The Immigration and Naturalization Service is streamlining procedures, cutting red tape, and using new technology to make it easier for legal immigrants to accept the responsibilities of citizenship and truly call America their home.

Today's Democratic Party also believes we must remain a nation of laws. We cannot tolerate illegal immigration and we must stop it. For years before Bill Clinton became President, Washington talked tough but failed to act. In 1992, our borders might as well not have existed. The border was under-patrolled, and what patrols there were, were under-equipped. Drugs flowed freely. Illegal immigration was rampant. Criminal immigrants, deported after committing crimes in America, returned the very next day to commit crimes again.

President Clinton is making our border a place where the law is respected and drugs and illegal immigrants are turned away. We have increased the Border Patrol by over 40 percent; in El Paso, our Border Patrol agents are so close together they can see each other. Last year alone, the Clinton Administration removed thousands of illegal workers from jobs across the country. Just since January of 1995, we have arrested more than 1,700 criminal aliens and prosecuted them on federal felony charges because they returned to America after having been deported.

However, as we work to stop illegal immigration, we call on all Americans to avoid the temptation to use this issue to divide people from each other. We deplore those who use the need to stop illegal immigration as a pretext for discrimination . And we applaud the wisdom of Republicans like Mayor Giuliani and Senator Domenici who oppose the mean-spirited and short-sighted effort of Republicans in Congress to bar the children of illegal immigrants from schools - it is wrong, and forcing children onto the streets is an invitation for them to join gangs and turn to crime.

Democrats want to protect American jobs by increasing criminal and civil sanctions against employers who hire illegal workers , but Republicans continue to favor inflammatory rhetoric over real action. We will continue to enforce labor standards to protect workers in vulnerable industries. We continue to firmly oppose welfare benefits for illegal immigrants. We believe family members who sponsor immigrants into this country should take financial responsibility for them, and be held legally responsible for supporting them.

[Dec 05, 2016] Is war the health of state ?

Notable quotes:
"... I keep trying to point out that these nations are proxies for the global plutocrats that own private finance and everything else. That is the social cancer we need to eliminate. The British people are not all bad any more than all Americans but all of private finance is bad and has been for centuries. ..."
Dec 03, 2016 | www.moonofalabama.org

james | Dec 3, 2016 11:39:28 AM | 2

sst comment -

"b

Well, if you looked at it and decided against it why am I wasting my time? "unlike the U.S. military which is used to destroys foreign cities without much thought of the aftermath" Always with the nasty, sneering, condescending attitude toward us. I remind you that it was the BRITISH army that destroyed your grandparents house, not the US Army. pl"

and the usa has learned and followed the British in so many of it's imperialist ways carrying the mantel for empire building forward into the 20th and 21st century.. enough of British or American bullshit..

psychohistorian | Dec 3, 2016 12:10:21 PM | 4
@ james who wrote " and the usa has learned and followed the british in so many of it's imperialist ways caring the mantel for empire building forward into the 20th and 21st century.. enough of british or american bullshit."

I keep trying to point out that these nations are proxies for the global plutocrats that own private finance and everything else. That is the social cancer we need to eliminate. The British people are not all bad any more than all Americans but all of private finance is bad and has been for centuries.

okie farmer | Dec 3, 2016 12:15:14 PM | 5
"the state made war and war made the state."

Lords of 'Pride and Plunder' by Robert Bartlett

The Crisis of the Twelfth Century: Power, Lordship, and the Origins of European Government by Thomas N. Bisson Princeton University Press, 677 pp., $39.50

One of the major institutions of pre-industrial society, and one that makes it hard for people in the modern Western world fully to grasp the past, is lordship. Lordship means a personal bond, reciprocal but not equal, tying inferiors to superiors, bringing the latter a power over the former that modern democratic and egalitarian ideologies would abhor. We are not accustomed to address others as "Master" or "Mistress," "My Lord" or "My Lady."

Of course modern Western societies are not communities of equals. Vast differences in wealth and access to education exist. But the world of lordship embraced and endorsed those differences. Hierarchy was a valued ideal, and some people considered themselves better born than others-remember those nineteenth-century novels with characters "of good family." The aristocrats ("aristocracy" means "rule by the best") did not court their inferiors. They ruled them, and, if they were just and well disposed, they protected them and furthered their interests. This is what "good lordship" meant. Not all lords, of course, were good. Submission to cruel, arbitrary, or unhinged masters could mean misery or death. Much of the savagery of the French Revolution is to be explained by the fact that thousands of peasants had suffered just such a submission.

Thomas Bisson's new book concerns itself with lordship, that all-pervasive institution, in a formative period of European history, the twelfth century (or rather the "long twelfth century," starting well before 1100 and continuing after 1200). It is an age that evokes for many the majesty of the great cathedrals, like Chartres and Canterbury, the rise of a new kind of intellectual inquiry, embodied in the questing spirit of Abelard or the emergence of the first universities, and the flourishing of the love lyrics of the troubadours and the tales of Arthurian romance. There is even the (now well established but initially paradoxical) notion of "the Twelfth-Century Renaissance." This book, however, presents a different, and much darker, twelfth century.

Bisson, professor of medieval history emeritus at Harvard, is one of the leading historians of the Middle Ages. His early work concentrated on Catalonia, a region with particularly rich archival sources from this period; he has continually expanded both his geographical range and the breadth of the historical questions he asks. In the 1990s he was a participant in a lively debate on the so-called "Feudal Revolution," the theory that a transformation in the patterns of power and authority took place in Europe in the decades around the year 1000. In those years it was argued that older, official, and public structures of justice and administration were replaced by new, more violent, and more localized forms, based on strongmen and their fortresses.

In his new book many of the elements of that "Feudal Revolution" recur, now extended to a later period. Bisson's summary of developments in Catalonia in the years 1020 to 1060 presents such a picture very clearly: there was "a terrifying collapse of public justice and the imposition of a new order of coercive lordship over an intimidated peasantry." Moving on into the twelfth century, the model is still recognizable: there is an "old passing world" ruled by a few nobles, and a "burgeoning new world" of "vicious men," castle-lords and knights prepared to use violence against the despised peasantry. This book is indeed an extended discussion of the issues arising from that earlier debate. Bisson acknowledges that it is "not a systematic treatise, still less a textbook," and those unfamiliar with the period may soon be lost. The book is an interpretation, an individual assessment of European history of that period, one that takes a stand on a dozen debated issues, often in implicit dialogue with other scholars. The main topics are lordship, violence, and the state.

Lordship was a building block of most societies until relatively recently -- serfdom was abolished in Russia only in 1861. Such societies were distinguished by extreme inequalities, made visible by costume and gestures, like bowing and doffing of hats, and often supported by belief in hereditary superiority and inferiority of blood. Collective groupings existed, but were not powerful, and conflict and ambition were channeled more by vertical than horizontal solidarities: retainers, servants, and other followers and dependants sought patronage from the great, not action alongside their peers. At the highest level, lesser aristocrats became followers of great aristocrats, who themselves would be competing for the ruler's favor. Costume dramas set in Tudor England, like Shakespeare in Love and Elizabeth, convey some of the flavor of such a world.

It was the prevalence of lordship that complicates any discussion of the medieval state. Bisson repeatedly uses the far from standard formulations "lord-king," "lord-ruler," and even "lord-archbishop" to convey the point that every ruler of this time was also a lord, a master of men, a patriarch of some kind, possessing his position as inheritance or property, rather than (or as well as) holding it as an office-indeed, he writes, "there is no sign that European people in the twelfth century thought of lordship and office as contrasting categories."

Kings were lords, but also more than lords. Like the great barons, their power was patrimonial: that is, inherited, dynastic, based on ideas of property we might call "private." A king's kingdom was his in the same way that a baron's landed estates were his. Transmission of power was through father-to-son inheritance, not by election. Hence marriages, births, and deaths were the great punctuating points of medieval politics, not caucuses and ballots. Yet a king was also more than just the greatest of the barons. Both the Church and a long secular tradition saw him as having special duties as a ruler, duties that might be called "public."

This dualism of lordship and the state meant that medieval rulership had two distinct faces, which were close to being opposites: on the one hand, the grand promises made at coronation by kings and emperors, to ensure justice and the protection of the weak and the Church; on the other hand, the reality of being a warlord trained in mounted warfare, a leader of proud, hard men, used to wielding lethal edged weapons, and the center of a court full of envy, ambition, and suspicion.

Europe in the eleventh and twelfth centuries was a militarized world: it was "an age of castles," when "those astride horses and bearing weapons routinely injured or intimidated people" -- although, of course, they were still doing it in the thirteenth century, fourteenth century, fifteenth century, and beyond. The Cossacks were still doing it in the twentieth century. This raises a problem. In the absence of even a hint of dependable statistics, it is virtually impossible to weigh up the relative violence of different periods and places of the past. We know all the difficulties involved in dealing with modern crime figures; for the past we rarely have figures of any kind, but must rely on stories told by chroniclers (often ecclesiastical) and interested parties (usually plaintiffs). Historians read the laments, the individual accounts of plunder, murder, and rape, and try to assess whether this was the way life was then, or whether it simply reflects a very bad moment in that world. And while there can be little doubt that levels of violence were higher in the medieval period than in modern Western peacetime societies, we, who live in the aftermath of the worst genocidal atrocities in recorded history, should not make that claim with any complacency.

It is not difficult to gather stories of local violence and oppression from the eleventh and twelfth centuries. But if we put these twelfth-century tales alongside those of the sixth-century historian-bishop Gregory of Tours, whose History of the Franks reveals a world of monstrous cruelty, we might wonder if things had really gotten much worse in the intervening six hundred years. On one occasion, Gregory writes, a noble discovered that two of his serfs had married without his consent: he supposedly said how delighted he was that they had at least not married serfs from another lordship; he promised that he would not separate them, and then kept his word by having them buried alive together. And was the twelfth century any more full of violence than, say, late medieval France, a happy hunting ground for mercenaries and freebooters during the Hundred Years' War?

The rulers of the eleventh and twelfth centuries were trained in, and glorified, war, and expected to live off it, as well as off the tribute of a subjugated peasantry. If such rulers formed "the state" of their day, what are the implications? The state engages in violence; it takes away our property. How then does it differ from a criminal enterprise? This was a question that went back at least as far as Saint Augustine in the fourth century:

What are robber gangs, except little kingdoms? If their wickedness prospers, so that they set up fixed abodes, occupy cities and subjugate whole populations, they then can take the name of kingdom with impunity.

Augustine's ponderings stem from the worrying doubt that states and kingdoms, indeed all lawfully constituted governments, are just the most successful of the robber gangs. This idea, that the state and the criminal gang are but larger and smaller versions of the same thing, was one recurrent strand in medieval thinking. In the words of Gregory VII, the reformist pope of the eleventh century:

Who does not know that kings and dukes had their origin in men who disregarded God and, with blind desire and intolerable presumption, strove to dominate their equals, that is, other men, through pride, plunder, perfidy, homicides, and every kind of crime, under the inspiration of the lord of this world, the devil?

Westerns (like Sam Peckinpah's Pat Garrett and Billy the Kid) often explore the thin line between the gunslinger and the sheriff, or the poignancy of the bandit turned law officer; and the thinness of that line is clear in the Middle Ages. In the fourteenth century the kings of France, wishing to concentrate their forces against the English, called upon their barons to curtail their own feuds and vendettas: "We forbid anyone to wage war (guerre) during our war (guerre)." What the king does and what the feuding nobles do is the same kind of thing-"war." Nowadays, we make a sharper distinction. For instance, in the modern world, someone who takes our property away is either a criminal or a tax collector. If the latter, then it is the state taking our property away, and most people, of most political outlooks, distinguish the lawmakers from the lawbreakers.

Traditionally the state took away people's property in order to finance war. In Charles Tilly's phrase, "the state made war and war made the state." The war-making, tax-raising state is indeed the standard, familiar political unit of modern world history. If we go back in time, do we reach a period when such an entity did not exist?

Bisson is not a scholar who throws the term "state" around freely. Indeed, the conceptual vocabulary of his book is worth a mention. On the one hand, Bisson is happy to use the traditional but deeply contested terms "feudal" and "feudalism," both of which even have entries in his glossary at the end of the book. He can write of "a massive feudalizing of England by the Normans." Some historians would do away with these concepts altogether. Even if some kinds of estates were called "fiefs" (feoda), they argue, why should that fact lead us to a characterization of a whole society? Perhaps a touch of self-questioning is visible in Bisson's embrace of the terminology: "'Feudal monarchy': is this the right concept?" he asks.
In contrast to his acceptance of this traditional terminology, Bisson has a marked tendency to use large conceptual terms with a peculiar, even personal, connotation. "Political" is an example. The bishops of this period, he says, "vied with one another for visible precedence," yet such struggles "were not political disputes; they were concerned with status, not process." A footnote refers us to an infamous incident when the archbishop of York, noticing that the archbishop of Canterbury had a seat higher than his, kicked it over and refused to be seated until he had a seat as high. Now, one might reasonably class this as a nursery tantrum, but why should not a public dispute over precedence count as "political"?
This wariness about the term "political" (usually in scare quotes in the book) is based on the idea that lordship "was personal, affective, and unpolitical in nature." Might it not be clearer to say that the politics of that time was not the same as the politics of ours? It may be that we have here an example of a recurrent dilemma, either to say that the power relations of long ago are not politics at all, or to say that they are, but that we must differentiate between medieval and modern politics. Similarly, we may say that the superior authorities of that time cannot be called states at all; or we can argue that they were, but that we must distinguish medieval and modern states.

One of the most important examples of Bisson's idiosyncratic use of general terms is his treatment of the word "government." He is reluctant even to apply the term to Norman England. "Royal lordship" was not the same thing as "government." Sometimes government is completely absent. Late-twelfth-century Europe was "an ungoverned society," although there were also "proto-governments" at this time; by the mid-thirteenth century "something like government hovered." This unwillingness to see the rulers of the central Middle Ages as constituting "governments" is to be explained partly because, in Bisson's view, the people of that time lacked any understanding of the state as distinct from lordship, but also because there are certain criteria for government, as distinct from lordship, that the rulers did not meet. He identifies three: accountability, official conduct, and social purpose.

"Accountability" is an important term in Bisson's historical vocabulary. Sometimes it means quite literally the rendering of financial accounts, like the Catalan fiscal records which Bisson himself has edited. He emphasizes the birth, in the twelfth century, of "a newly searching and flexible accountability," as simple surveys of resources and fixed revenues, which can be found from early in the Middle Ages, were supplemented by balance sheets of incoming and outgoing assets. The English Pipe Rolls, annual audits of income and expenditures of the royal sheriffs, are a classic example. The English Dialogue of the Exchequer of 1178, or thereabouts, reveals a department of government that is professional, with its own technical expertise, and (in the Dialogue) its own handbook or manual. Slightly later, in 1202, there appears what has been called "the first budget of the French monarchy."

But Bisson also uses the word in a broader sense: accountability means official responsibility, answerability. He associates it with the idea of office. Record-keeping is in fact one test of official status. And true government is "the exercise of power for social purpose," "social purpose" perhaps to be glossed here as "the common good." It is the emergence of "official conduct aimed at social purpose," linked, interestingly, with the rise of public taxation, that, for Bisson, signals the shift of the balance from lordship to government in the thirteenth century.

However, the chronology of state formation in the Middle Ages is a disputed issue. Some historians talk as if there were a stateless period at some point in the central Middle Ages. Others hold the view that, to take one notable example, the kingdom of England of the year 1000 was not only a state but a strong, centralized, and pervasive state. If taxation and a standardized coinage are, in Bisson's words, parts of "a new model of associative power" around the year 1200, then the uniform land tax and centralized currency of eleventh-century England show that that model already existed in some places two hundred years earlier.

What cannot be disputed is that over the course of the eleventh, twelfth, and thirteenth centuries, the state became increasingly bureaucratic. The documents produced by the English government in the eleventh century could be placed on one large table (even given that monumental oddity, Domesday Book, the extensive survey of land ownership made in 1086 under William the Conqueror). The documents produced by the English government in the thirteenth century fill whole rooms and could never be read in one person's lifetime. Written records supplemented or replaced older oral forms of information gathering, testimony, or command (Michael Clanchy's 1979 masterpiece, From Memory to Written Record, analyzes this development for precociously bureaucratic England in the Norman and Plantagenet period). But more bureaucratic government does not necessarily mean less violent, or even less arbitrary, government.

Historians like bureaucracy, because it feeds their hunger for written sources, the raw material with which they work; but the bond between historians and government is deeper than that. The historical profession grew up in the nineteenth and early twentieth centuries in close symbiosis with government. Not only was the heart of historical study usually the archives produced by past governments, but many of the students and teachers in those generations, the first to study history as a discipline, entered government service. Charles Homer Haskins, the founding father of American medieval scholarship, was an adviser to Woodrow Wilson at the Paris Peace Conference of 1919.

He was also the teacher of Joseph Strayer, himself the teacher of Bisson. Such academic genealogies can be overplayed, but there is no doubt that all three great medievalists, Haskins, Strayer, and Bisson, demonstrate a deep-rooted concern with the techniques and records of administration, with the procedures of the bureaucrats and officials. Strayer was as familiar with the modern as with the medieval version, since he worked for the CIA. One of his most vigorous pieces of work is entitled On the Medieval Origins of the Modern State (1970; one might notice the emphasis on both the "origins" and the "modern"; we live in the modern state; its origins go back a long way, but the state of those days was not the state of ours). The book contains Strayer's cogent definition of feudalism as "public powers in private hands," with that confident assurance that these adjectives, "public" and "private," convey a simple and evident distinction that will arouse no intellectual discomfort in readers. By contrast, Bisson's book is generated in part by his wrestling with such concepts and their implications.

Bisson's book is called The Crisis of the Twelfth Century. "Crisis" means a vitally important or decisive stage in the progress of anything. But in that sense, any century of human history is a crisis. One might even say that this is simply the condition of human life-we are always in an Age of Crisis (although the situation might not always be as alarming as today's). Bisson acknowledges that "'crisis' was not a common word in the verbiage of the day," and the one instance he cites of the contemporary use of the word (in its Latin form discrimen) refers to a succession crisis in Poland in 1180. He wishes to see the various distinct political crises he discusses (such as the Saxon revolt of 1075, the communal insurrection in Laon in 1111, the "anarchy" of King Stephen's reign) as part of "the same wider crisis of multiplied knights and castles."

However, a case can be made that the levels of violence and disorder in this period were largely dictated by the patterns of high politics rather than by a deep-seated structural malaise. Disputed successions, or the accession of a child-king, could indeed upset the world of knights and castles, unleashing the strongmen and their castle-based predatory attacks. Yet a regime of knights and castles could also form the basis for fairly stable feudal monarchies, such as one sees in France and England for most of the thirteenth century. If this is so, there were, of course, crises in the twelfth century, but no Crisis.

The violence and greed of European knights of this period were directed beyond the local victims. Bisson's "long twelfth century" was not only an age of predatory lords in their castles bullying their peasantry but also an age of expansionary, one could say colonialist, violence. Christian armies, led by these predatory lords, crossed into Muslim lands, capturing Toledo in 1085, Jerusalem in 1099, and landing in North Africa in 1148; they destroyed the last remnants of West Slav paganism in the Baltic in 1168; they even turned their formidable fighting strength against their estranged Christian cousins in the Greek East, and sacked Constantinople in 1204. The energies generated in the conflicts between mounted men in the West, and the expertise they acquired in subjugating and fleecing the local peasantry, could be exported. The story of European violence is far from unique, but it was in the central Middle Ages that it took a form that shaped the subsequent history of the world.

A traditional view of the development of European society in the central Middle Ages, a view to be found in textbooks past and present, is that the empire of Charlemagne (747–814) and his successors had important elements of public authority, in the form of officials with delegated powers and courts open to all free men, but that this regime was replaced, around the year 1000, with a heavily militarized and violent world of strongmen in castles, lording it over peasants. Over the course of time this world was, in its turn, transformed by the persistent efforts of the kings of the twelfth and thirteenth centuries into a network of more centralized and bureaucratic states, which led ultimately to modern systems of government. Like every model at this level of generality, as long as people who know something about the subject have created it, there must be some truth in this picture, however little it can be the whole truth. But we might have questions. Was the "old public order" of Charlemagne and his successors so public and so ordered? Was the subsequent regime so close to anarchy?

Bisson adds to this traditional account by thinking deeply about the benefits and disadvantages of government. He is very aware of the inhumanity of the past he studies. He refers, with allusion to the words of the twelfth-century cleric John of Salisbury, to "hunter-lords." John was talking about the way that aristocrats were obsessed with the chase, but we might apply his phrase in a wider sense. Since some theorists believe that human society is imprinted with its origins in hunting packs and the mentality of the pack, the predatory lordship of the central Middle Ages could be conceived of as just such a hunting pack-but its prey being fellow human beings, rather than beasts.

Confronting this world of hunter and hunted, Bisson is inspired by attractively humane impulses. In an earlier book, Tormented Voices, a microhistorical analysis of complaints raised by Catalan peasants in the twelfth century, he stated explicitly that he was attempting "an essay in compassionate history." Likewise in this book. And he looks for public, accountable, official remedies for suffering and oppression. He seems sympathetic to the idea that "power is rightly oriented towards the social needs of people." "If ever government was the solution, not the problem," he writes, "it was so for European peoples in the twelfth century." Is the modern world so happy in its governments? Whether we should endure the violence of the state, as a defense against the yet more fearful violence of our neighbors, and whether there comes a point where the violence of the state must be resisted are great recurrent questions of moral and political life. The questions raised by Bisson's book remain open.

james | Dec 3, 2016 1:03:24 PM | 6
@4 psychohistorian.. and i agree with you in that too.. it has to do with the packaging and a tendency in people to identify with the packaging - in this example 'made in the usa' as some sort of rationale for that social sickness many suffer from called 'patriotism'.. it seems to be especially prevalent in the worst nations, the usa at this point in time being the focal point for much of this marketing...
psychohistorian | Dec 3, 2016 1:28:39 PM | 8
@ okie farmer who added a loooong comment that contained the following about the definition of government:
"
He identifies three: accountability, official conduct, and social purpose.
"

The narrative provided did not get into a discussion of "social purpose" but I think that it is an important concept. The example I would posit is the original humanistic motto of the US, E Pluribus Unum which was instantiated by government creations of the time like the pony express....true socialism, if you need an ism to cling to. Social Security INSURANCE is another example of an instantiation of social purpose.

The original US motto was replaced by In God We Trust in the mid 1950's which, IMO, destroyed the social purpose concept of government and instead tells you to trust the leaders and religious institutions.....reversion to kings and feudalism.

You get the government you demand. What sort of world do you want to pass to the children?

ben | Dec 3, 2016 2:01:32 PM | 10
Why is the U$A addicted to war?

read the books online. don't let the books format fool you, massive thought, with footnotes.

http://www.addictedtowar.com/

[Dec 05, 2016] The Real Story of How America Became an Economic Superpower

Notable quotes:
"... Rather than join the struggle of imperial rivalries, the United States could use its emerging power to suppress those rivalries altogether. ..."
"... "a power unlike any other. It had emerged, quite suddenly, as a novel kind of 'super-state,' exercising a veto over the financial and security concerns of the other major states of the world." ..."
"... Peter Heather, the great British historian of Late Antiquity, explains human catastrophes with a saying of his father's, a mining engineer: "If man accumulates enough combustible material, God will provide the spark." So it happened in 1929. The Deluge that had inundated the rest of the developed world roared back upon the United States. ..."
"... "The originality of National Socialism was that, rather than meekly accepting a place for Germany within a global economic order dominated by the affluent English-speaking countries, Hitler sought to mobilize the pent-up frustrations of his population to mount an epic challenge to this order." ..."
"... He could not accept subordination to the United States because, according to his lurid paranoia, "this would result in enslavement to the world Jewish conspiracy, and ultimately race death." ..."
"... By 1944, foreigners constituted 20 percent of the German workforce and 33 percent of armaments workers (less than 9 percent of the population of today's liberal and multicultural Germany is foreign-born). ..."
"... The Hitlerian vision of a united German-led Eurasia equaling the Anglo-American bloc proved a crazed and genocidal fantasy. ..."
www.theatlantic.com

The United States might claim a broader democracy than those that prevailed in Europe. On the other hand, European states mobilized their populations with an efficiency that dazzled some Americans (notably Theodore Roosevelt) and appalled others (notably Wilson). The magazine founded by pro-war intellectuals in 1914, The New Republic, took its title precisely because its editors regarded the existing American republic as anything but the hope of tomorrow.

Yet as World War I entered its third year-and the first year of Tooze's story-the balance of power was visibly tilting from Europe to America. The belligerents could no longer sustain the costs of offensive war. Cut off from world trade, Germany hunkered into a defensive siege, concentrating its attacks on weak enemies like Romania. The Western allies, and especially Britain, outfitted their forces by placing larger and larger war orders with the United States. In 1916, Britain bought more than a quarter of the engines for its new air fleet, more than half of its shell casings, more than two-thirds of its grain, and nearly all of its oil from foreign suppliers, with the United States heading the list. Britain and France paid for these purchases by floating larger and larger bond issues to American buyers-denominated in dollars, not pounds or francs. "By the end of 1916, American investors had wagered two billion dollars on an Entente victory," computes Tooze (relative to America's estimated GDP of $50 billion in 1916, the equivalent of $560 billion in today's money).

That staggering quantity of Allied purchases called forth something like a war mobilization in the United States. American factories switched from civilian to military production; American farmers planted food and fiber to feed and clothe the combatants of Europe. But unlike in 1940-41, the decision to commit so much to one side's victory in a European war was not a political decision by the U.S. government. Quite the contrary: President Wilson wished to stay out of the war entirely. He famously preferred a "peace without victory." The trouble was that by 1916, the U.S. commitment to Britain and France had grown-to borrow a phrase from the future-too big to fail.

Tooze's portrait of Woodrow Wilson is one of the most arresting novelties of his book. His Wilson is no dreamy idealist. The president's animating idea was an American exceptionalism of a now-familiar but then-startling kind. His Republican opponents-men like Theodore Roosevelt, Henry Cabot Lodge, and Elihu Root-wished to see America take its place among the powers of the earth. They wanted a navy, an army, a central bank, and all the other instrumentalities of power possessed by Britain, France, and Germany. These political rivals are commonly derided as "isolationists" because they mistrusted the Wilson's League of Nations project. That's a big mistake. They doubted the League because they feared it would encroach on American sovereignty. It was Wilson who wished to remain aloof from the Entente, who feared that too close an association with Britain and France would limit American options. This aloofness enraged Theodore Roosevelt, who complained that the Wilson-led United States was "sitting idle, uttering cheap platitudes, and picking up [European] trade, whilst they had poured out their blood like water in support of ideals in which, with all their hearts and souls, they believe."

Wilson was guided by a different vision: Rather than join the struggle of imperial rivalries, the United States could use its emerging power to suppress those rivalries altogether. Wilson was the first American statesman to perceive that the United States had grown, in Tooze's words, into "a power unlike any other. It had emerged, quite suddenly, as a novel kind of 'super-state,' exercising a veto over the financial and security concerns of the other major states of the world."

Wilson hoped to deploy this emerging super-power to enforce an enduring peace. His own mistakes and those of his successors doomed the project, setting in motion the disastrous events that would lead to the Great Depression, the rise of fascism, and a second and even more awful world war.

What went wrong? "When all is said and done," Tooze writes, "the answer must be sought in the failure of the United States to cooperate with the efforts of the French, British, Germans and the Japanese [leaders of the early 1920s] to stabilize a viable world economy and to establish new institutions of collective security. Given the violence they had already experienced and the risk of even greater future devastation, France, Germany, Japan, and Britain could all see this. But what was no less obvious was that only the US could anchor such a new order." And that was what Americans of the 1920s and 1930s declined to do-because doing so implied too much change at home for them: "At the hub of the rapidly evolving, American-centered world system there was a polity wedded to a conservative vision of its own future."

Widen the view, however, and the "forgotten depression" takes on a broader meaning as one of the most ominous milestones on the world's way to the Second World War. After World War II, Europe recovered largely as a result of American aid; the nation that had suffered least from the war contributed most to reconstruction. But after World War I, the money flowed the other way.

Take the case of France, which suffered more in material terms than any World War I belligerent except Belgium. Northeastern France, the country's most industrialized region in 1914, had been ravaged by war and German occupation. Millions of men in their prime were dead or crippled. On top of everything, the country was deeply in debt, owing billions to the United States and billions more to Britain. France had been a lender during the conflict too, but most of its credits had been extended to Russia, which repudiated all its foreign debts after the Revolution of 1917. The French solution was to exact reparations from Germany.

Britain was willing to relax its demands on France. But it owed the United States even more than France did. Unless it collected from France-and from Italy and all the other smaller combatants as well-it could not hope to pay its American debts.

Americans, meanwhile, were preoccupied with the problem of German recovery. How could Germany achieve political stability if it had to pay so much to France and Belgium? The Americans pressed the French to relent when it came to Germany, but insisted that their own claims be paid in full by both France and Britain.

Germany, for its part, could only pay if it could export, and especially to the world's biggest and richest consumer market, the United States. The depression of 1920 killed those export hopes. Most immediately, the economic crisis sliced American consumer demand precisely when Europe needed it most. True, World War I was not nearly as positive an experience for working Americans as World War II would be; between 1914 and 1918, for example, wages lagged behind prices. Still, millions of Americans had bought billions of dollars of small-denomination Liberty bonds. They had accumulated savings that could have been spent on imported products. Instead, many used their savings for food, rent, and mortgage interest during the hard times of 1920-21.

But the gravest harm done by the depression to postwar recovery lasted long past 1921. To appreciate that, you have to understand the reasons why U.S. monetary authorities plunged the country into depression in 1920.

Grant rightly points out that wars are usually followed by economic downturns. Such a downturn occurred in late 1918-early 1919. "Within four weeks of the Armistice, the [U.S.] War Department had canceled $2.5 billion of its then outstanding $6 billion in contracts; for perspective, $2.5 billion represented 3.3 percent of the 1918 gross national product," he observes. Even this understates the shock, because it counts only Army contracts, not Navy ones. The postwar recession checked wartime inflation, and by March 1919, the U.S. economy was growing again.

As the economy revived, workers scrambled for wage increases to offset the price inflation they'd experienced during the war. Monetary authorities, worried that inflation would revive and accelerate, made the fateful decision to slam the credit brakes, hard. Unlike the 1918 recession, that of 1920 was deliberately engineered. There was nothing invisible about it. Nor did the depression "cure itself." U.S. officials cut interest rates and relaxed credit, and the economy predictably recovered-just as it did after the similarly inflation-crushing recessions of 1974-75 and 1981-82.

But 1920-21 was an inflation-stopper with a difference. In post-World War II America, anti-inflationists have been content to stop prices from rising. In 1920-21, monetary authorities actually sought to drive prices back to their pre-war levels. They did not wholly succeed, but they succeeded well enough. One price especially concerned them: In 1913, a dollar bought a little less than one-twentieth of an ounce of gold; by 1922, it comfortably did so again.

... ... ...

The American depression of 1920 made that decision all the more difficult. The war had vaulted the United States to a new status as the world's leading creditor, the world's largest owner of gold, and, by extension, the effective custodian of the international gold standard. When the U.S. opted for massive deflation, it thrust upon every country that wished to return to the gold standard (and what respectable country would not?) an agonizing dilemma. Return to gold at 1913 values, and you would have to match U.S. deflation with an even steeper deflation of your own, accepting increased unemployment along the way. Alternatively, you could re-peg your currency to gold at a diminished rate. But that amounted to an admission that your money had permanently lost value-and that your own people, who had trusted their government with loans in local money, would receive a weaker return on their bonds than American creditors who had lent in dollars.

Britain chose the former course; pretty much everybody else chose the latter.

The consequences of these choices fill much of the second half of The Deluge. For Europeans, they were uniformly grim, and worse. But one important effect ultimately rebounded on Americans. America's determination to restore a dollar "as good as gold" not only imposed terrible hardship on war-ravaged Europe, it also threatened to flood American markets with low-cost European imports. The flip side of the Lost Generation enjoying cheap European travel with their strong dollars was German steelmakers and shipyards underpricing their American competitors with weak marks.

Such a situation also prevailed after World War II, when the U.S. acquiesced in the undervaluation of the Deutsche mark and yen to aid German and Japanese recovery. But American leaders of the 1920s weren't willing to accept this outcome. In 1921 and 1923, they raised tariffs, terminating a brief experiment with freer trade undertaken after the election of 1912. The world owed the United States billions of dollars, but the world was going to have to find another way of earning that money than selling goods to the United States.

That way was found: more debt, especially more German debt. The 1923 hyper-inflation that wiped out Germany's savers also tidied up the country's balance sheet. Post-inflation Germany looked like a very creditworthy borrower. Between 1924 and 1930, world financial flows could be simplified into a daisy chain of debt. Germans borrowed from Americans, and used the proceeds to pay reparations to the Belgians and French. The French and Belgians, in turn, repaid war debts to the British and Americans. The British then used their French and Italian debt payments to repay the United States, who set the whole crazy contraption in motion again. Everybody could see the system was crazy. Only the United States could fix it. It never did.

Peter Heather, the great British historian of Late Antiquity, explains human catastrophes with a saying of his father's, a mining engineer: "If man accumulates enough combustible material, God will provide the spark." So it happened in 1929. The Deluge that had inundated the rest of the developed world roared back upon the United States.

... ... ...

"The United States has the Earth, and Germany wants it." Thus might Hitler's war aims have been summed up by a latter-day Woodrow Wilson. From the start, the United States was Hitler's ultimate target. "In seeking to explain the urgency of Hitler's aggression, historians have underestimated his acute awareness of the threat posed to Germany, along with the rest of the European powers, by the emergence of the United States as the dominant global superpower," Tooze writes.

"The originality of National Socialism was that, rather than meekly accepting a place for Germany within a global economic order dominated by the affluent English-speaking countries, Hitler sought to mobilize the pent-up frustrations of his population to mount an epic challenge to this order." Of course, Hitler was not engaged in rational calculation. He could not accept subordination to the United States because, according to his lurid paranoia, "this would result in enslavement to the world Jewish conspiracy, and ultimately race death." He dreamed of conquering Poland, Ukraine, and Russia as a means of gaining the resources to match those of the United States.

The vast landscape in between Berlin and Moscow would become Germany's equivalent of the American west, filled with German homesteaders living comfortably on land and labor appropriated from conquered peoples-a nightmare parody of the American experience with which to challenge American power.

Could this vision have ever been realized? Tooze argues in The Wages of Destruction that Germany had already missed its chance. "In 1870, at the time of German national unification, the population of the United States and Germany was roughly equal and the total output of America, despite its enormous abundance of land and resources, was only one-third larger than that of Germany," he writes. "Just before the outbreak of World War I the American economy had expanded to roughly twice the size of that of Imperial Germany. By 1943, before the aerial bombardment had hit top gear, total American output was almost four times that of the Third Reich."

Germany was a weaker and poorer country in 1939 than it had been in 1914. Compared with Britain, let alone the United States, it lacked the basic elements of modernity: There were just 486,000 automobiles in Germany in 1932, and one-quarter of all Germans still worked as farmers as of 1925. Yet this backward land, with an income per capita comparable to contemporary "South Africa, Iran and Tunisia," wagered on a second world war even more audacious than the first.

The reckless desperation of Hitler's war provides context for the horrific crimes of his regime. Hitler's empire could not feed itself, so his invasion plan for the Soviet Union contemplated the death by starvation of 20 to 30 million Soviet urban dwellers after the invaders stole all foodstuffs for their own use. Germany lacked workers, so it plundered the labor of its conquered peoples. By 1944, foreigners constituted 20 percent of the German workforce and 33 percent of armaments workers (less than 9 percent of the population of today's liberal and multicultural Germany is foreign-born).

On paper, the Nazi empire of 1942 represented a substantial economic bloc. But pillage and slavery are not workable bases for an industrial economy. Under German rule, the output of conquered Europe collapsed. The Hitlerian vision of a united German-led Eurasia equaling the Anglo-American bloc proved a crazed and genocidal fantasy.

How the Great War Shaped the World

[Dec 05, 2016] Peggy Noonan What We Lose if We Give Up Privacy

Notable quotes:
"... A loss of the expectation of privacy in communications is a loss of something personal and intimate, and it will have broader implications. ..."
"... Mr. Hentoff sees the surveillance state as a threat to free speech, too ..."
"... An entrenched surveillance state will change and distort the balance that allows free government to function successfully. ..."
"... "When you have this amount of privacy invasion put into these huge data banks, who knows what will come out?" ..."
"... Asked about those attempts, he mentions the Alien and Sedition Acts of 1798, the Red Scare of the 1920s and the McCarthy era. Those times and incidents, he says, were more than specific scandals or news stories, they were attempts to change our nature as a people. ..."
"... What of those who say they don't care what the federal government does as long as it keeps us safe? The threat of terrorism is real, Mr. Hentoff acknowledges. Al Qaeda is still here, its networks are growing. But you have to be careful about who's running U.S. intelligence and U.S. security, and they have to be fully versed in and obey constitutional guarantees. ..."
"... Mr. Hentoff notes that J. Edgar Hoover didn't have all this technology. "He would be so envious of what NSA can do." ..."
Aug 16, 2013 | WSJ

...Among the pertinent definitions of privacy from the Oxford English Dictionary: "freedom from disturbance or intrusion," "intended only for the use of a particular person or persons," belonging to "the property of a particular person." Also: "confidential, not to be disclosed to others." Among others, the OED quotes the playwright Arthur Miller, describing the McCarthy era: "Conscience was no longer a private matter but one of state administration."

Privacy is connected to personhood. It has to do with intimate things-the innards of your head and heart, the workings of your mind-and the boundary between those things and the world outside.

A loss of the expectation of privacy in communications is a loss of something personal and intimate, and it will have broader implications. That is the view of Nat Hentoff, the great journalist and civil libertarian. He is 88 now and on fire on the issue of privacy. "The media has awakened," he told me. "Congress has awakened, to some extent." Both are beginning to realize "that there are particular constitutional liberty rights that [Americans] have that distinguish them from all other people, and one of them is privacy."

Mr. Hentoff sees excessive government surveillance as violative of the Fourth Amendment, which protects "the right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures" and requires that warrants be issued only "upon probable cause . . . particularly describing the place to be searched, and the persons or things to be seized."

But Mr. Hentoff sees the surveillance state as a threat to free speech, too. About a year ago he went up to Harvard to speak to a class. He asked, he recalled: "How many of you realize the connection between what's happening with the Fourth Amendment with the First Amendment?" He told the students that if citizens don't have basic privacies-firm protections against the search and seizure of your private communications, for instance-they will be left feeling "threatened." This will make citizens increasingly concerned "about what they say, and they do, and they think." It will have the effect of constricting freedom of expression. Americans will become careful about what they say that can be misunderstood or misinterpreted, and then too careful about what they say that can be understood. The inevitable end of surveillance is self-censorship.

All of a sudden, the room became quiet. "These were bright kids, interested, concerned, but they hadn't made an obvious connection about who we are as a people." We are "free citizens in a self-governing republic."

Mr. Hentoff once asked Justice William Brennan "a schoolboy's question": What is the most important amendment to the Constitution? "Brennan said the First Amendment, because all the other ones come from that. If you don't have free speech you have to be afraid, you lack a vital part of what it is to be a human being who is free to be who you want to be." Your own growth as a person will in time be constricted, because we come to know ourselves by our thoughts.

He wonders if Americans know who they are compared to what the Constitution says they are.

Mr. Hentoff's second point: An entrenched surveillance state will change and distort the balance that allows free government to function successfully. Broad and intrusive surveillance will, definitively, put government in charge. But a republic only works, Mr. Hentoff notes, if public officials know that they-and the government itself-answer to the citizens. It doesn't work, and is distorted, if the citizens must answer to the government. And that will happen more and more if the government knows-and you know-that the government has something, or some things, on you. "The bad thing is you no longer have the one thing we're supposed to have as Americans living in a self-governing republic," Mr. Hentoff said. "The people we elect are not your bosses, they are responsible to us." They must answer to us. But if they increasingly control our privacy, "suddenly they're in charge if they know what you're thinking."

This is a shift in the democratic dynamic. "If we don't have free speech then what can we do if the people who govern us have no respect for us, may indeed make life difficult for us, and in fact belittle us?"

If massive surveillance continues and grows, could it change the national character? "Yes, because it will change free speech."

What of those who say, "I have nothing to fear, I don't do anything wrong"? Mr. Hentoff suggests that's a false sense of security.

"When you have this amount of privacy invasion put into these huge data banks, who knows what will come out?"

Or can be made to come out through misunderstanding the data, or finagling, or mischief of one sort or another.

"People say, 'Well I've done nothing wrong so why should I worry?' But that's too easy a way to get out of what is in our history-constant attempts to try to change who we are as Americans."

Asked about those attempts, he mentions the Alien and Sedition Acts of 1798, the Red Scare of the 1920s and the McCarthy era. Those times and incidents, he says, were more than specific scandals or news stories, they were attempts to change our nature as a people.

What of those who say they don't care what the federal government does as long as it keeps us safe? The threat of terrorism is real, Mr. Hentoff acknowledges. Al Qaeda is still here, its networks are growing. But you have to be careful about who's running U.S. intelligence and U.S. security, and they have to be fully versed in and obey constitutional guarantees.

"There has to be somebody supervising them who knows what's right. . . . Terrorism is not going to go away. But we need someone in charge of the whole apparatus who has read the Constitution."

Advances in technology constantly up the ability of what government can do. Its technological expertise will only become deeper and broader.

"They think they're getting to how you think. The technology is such that with the masses of databases, then privacy will get even weaker."

Mr. Hentoff notes that J. Edgar Hoover didn't have all this technology. "He would be so envious of what NSA can do."

[Dec 05, 2016] Why dont we save our steelworkers, when weve spent billions on bankers?

Oct 28, 2015 | The Guardian

Every so often a society decides which of its citizens really matter. Which ones get the star treatment and the big cash handouts – and which get shoved to the bottom of the pile and penalised. These are the big, rough choices post-crash Britain is making right now.

A new hierarchy is being set in place by David Cameron in budget after austerity budget. Wealthy pensioners: winners. Young would-be homeowners: losers. Millionaires see their taxes cut to 45%, while the working poor pay a marginal tax rate of 80%. Big business gets to write its own tax code; benefit claimants face harsh sanctions.

When the contours of this new social order are easy to spot, they can cause public uproar – as with the cuts to tax credits. Elsewhere, they're harder to pick out, though still central. It is into this category that the crisis in the British steel industry falls.

It would be easy to tune out the past few weeks' headlines about plant closures and job losses as just another story of business disaster. But what's happening to our steelworkers, and what we do to protect them, goes to the heart of the debate about which people – and which places – count in Britain's political economy.

innocuously 28 Oct 2015 21:02

The British people, the ordinary British people must have complete and utter contempt for this British Government of Cameron and Osborne.

Why the hell does this incompetent, uncaring as well as utterly pedantic government in its pursuit of non-government help (except when it comes to getting their Chinese Communist buddies to build a nuclear power station in Britain. Why on earth do we need to be told by an obviously astute, caring, concerned and intelligent individual by the name of Aditya Chakrabortty what is so manifestly wrong, how the French, Germans and Dutch draw money to help their industries from the European Commission Globalisation Adjustment Fund.

Once Britain (or was it England?) was called the Workshop of the World but the Forcking governments of the likes of Cameron, Osborne, Blair and Brown do not seem to give a stuff. They have poured billions of pounds into the bloody banking system which can be seen to pretty much of a giant cesspit of greed, whose leaders award themselves with giant bonuses from their customers money. Britain is not a country just of greedy Banksters and elitist politicians it should be a country of industry workers.

As Chakrabortty states once the steel industry is gone it is gone and with it so much other manufacturing capability but these Contemptible shitbag-like individuals in this vile- behaving government cannot seem to get this into their apparently stupid heads.

Cameron's and Osborne's government has behaved with utter wickedness, evil and stupidity in selling out Britain, its industry and infrastructure to a China which is even now trampling on the human rights of its people and threating all its neighbours around the South China Sea and all we get in Britain from these contemptible elitist politicians is an uncaring watching of the destruction of its industry and a selling out of its security and infrastructure.

MikeFerro1 28 Oct 2015 20:55

This mess, like much else that's wrong with the current state of Britain, is directly attributable to our membership of the European Union.
Outside the EU we could
1. From our own seat on the World Trade Organisation tackle China over dumping which is illegal under WTO rules
2. Provide state support to our steel industry if we chose to
3. Not have sky high energy prices due to our closing down perfectly good coal fired generating plants at the same time as Germany and China (to name but two) are building new ones
I know some other EU nations appear to get round these difficulties but if we weren't in the EU we wouldn't have to, we'd make our own choices.

Rivett4PM 28 Oct 2015 20:08

The comparison between the steel industry and the City is flawed. It was a consequence of the bail outs of RBS and HBOS that many jobs were saved in the City, but not the reason why the bail outs were undertaken. The banking bail outs were aimed at saving the UK economy as a whole, which would have collapsed without access to the credit/liquidity provided by the banking industry. The knock on effects of the steel industry shut down will be far reaching but nowhere near the same scale as would have been the case if the same had occurred in banking. This is, I am sure, no comfort to the families of steel workers and the surrounding communities, but let's not pretend that bankers received special favor simply because they are bankers.

[Dec 05, 2016] Spanish civil war nostalgics join fight alongside Ukrainian rebels

Notable quotes:
"... That star and a ribbon around Munez's wrist hint at the Spaniards' motivation for joining a war thousands of miles from home. The ribbon's red, yellow and purple are the colors of the Republicans in the Spanish Civil War, a conflict in the 1930s where thousands of foreigners joined the leftists against right-wing foes who eventually prevailed. ..."
"... More than 1,100 people have been killed in the fighting in Ukraine since mid-April, according to the United Nations, in a civil conflict that has dragged ties between Russia and the West to their lowest since the Cold War. ..."
"... Davilla-Rivas blamed the West - which has imposed sanctions on Moscow, accusing it of backing the rebels - for stoking the war. "The United States is trying to provoke a third (world war) against Russia here with your people," he said. "Ordinary people are suffering because they are caught in between three imperial powers - the Russian Federation, the European Union and, certainly, the United States, which is putting money into all this." ..."
"... Civil war in Ukraine is going more then 4 months. 30 000 Ukrainians was killed, and 1 million expelled from their homes. ..."
"... Volunteers, revolutionaries, zealots, idealist, mercenaries are all drawn to conflicts all over the globe. ..."
Aug 08, 2014 | Yahoo/Reuters

Angel Davilla-Rivas, a Spaniard who came to east Ukraine to fight alongside pro-Russian rebels, proudly shows off two big monochrome portraits of Soviet leaders Vladimir Lenin and Joseph Stalin, tattooed on the right and left side of his torso.

Davilla-Rivas and his comrade Rafa Munez, both in their mid-twenties, traveled by train from Madrid to eastern Ukraine where they joined the Vostok battalion, the most prominent and heavily armed unit fighting Ukrainian troops.

"I am the only son, and it hurts my mother and father and my family a lot that I am putting myself at risk. But ... I can't sleep in my bed knowing what's going on here," said Davilla-Rivas, sporting a cap with the Soviet red star pinned to it.

That star and a ribbon around Munez's wrist hint at the Spaniards' motivation for joining a war thousands of miles from home. The ribbon's red, yellow and purple are the colors of the Republicans in the Spanish Civil War, a conflict in the 1930s where thousands of foreigners joined the leftists against right-wing foes who eventually prevailed.

Angel said he wanted to return the favor after the Soviet Union, under Stalin, supported the Republican side in Spain.

More than 1,100 people have been killed in the fighting in Ukraine since mid-April, according to the United Nations, in a civil conflict that has dragged ties between Russia and the West to their lowest since the Cold War.

The Spaniards are not the first foreigners to enter the fight.

Men from Russia, its former rebel republic of Chechnya and the Caucasus region of North Ossetia have fought on the rebel side along with volunteers from a Russian-backed separatist enclave of Georgia and natives of Serbia.

Russians have also taken top positions among the rebels, though a local took over at the helm of the self-proclaimed "Donetsk Peoples' Republic" on Thursday, in a move aimed at blunting Western accusations the rebellion is run by Moscow.

Moscow said last month there were reports that citizens from Sweden, Finland, France and the former Soviet Baltic states had joined pro-Kiev volunteer battalions in the east as "mercenaries".

Davilla-Rivas blamed the West - which has imposed sanctions on Moscow, accusing it of backing the rebels - for stoking the war. "The United States is trying to provoke a third (world war) against Russia here with your people," he said. "Ordinary people are suffering because they are caught in between three imperial powers - the Russian Federation, the European Union and, certainly, the United States, which is putting money into all this."

A Vostok fighter said he was happy to have the Spaniards. "We need support now, we need fighters. An additional automatic gun will do no harm, to support, to cover one's back," said the young, brown-haired man who did not give his name. The Spanish embassy in Moscow was not immediately available for comment.

(Writing by Gabriela Baczynska; Editing by Robin Pomeroy)

blazo 6 months ago

Civil war in Ukraine is going more then 4 months. 30 000 Ukrainians was killed, and 1 million expelled from their homes. Not too bad for only 4 months. But it could be better.

Commander in chief of glorious Kiev army, Mr Porkoshenko, and his sponsor in killings and expulsions, Mr Obama are not satisfied. For money spent, much higher pace of killing should be #$%$ured. What is their reference? In Babin Yar during WW 2, 1200 Ukrainian #$%$, with help of 300 Germans, managed to kill 60 000 Ukrainians for only two days. So Mr Porkoshenko ask from Chef of all Ukrainian security forces, Mr Paruby to explain discrepancy in efficiency in Babin Yar, and in Donbas killings. Mr Paruby said: In Babin Yar Ukrainians to be killed were civilized and unarmed. They even smiled for photographs during killing. But in Donbas they are barbaric armed people, they don t allow us to kill them in peace. They turned arms on us, and killed 10 000 of our brave soldiers. They burned our tanks, APCs, and shot down our jet bombers. And as a extreme barbarism, they captured from us multiple rocket launchers, and fired on us, killing our 25th, 72nd, 79th motorized brigades. Mr Porkoshenko said: You are fired, and kicked him with foot to his #$%$.

The great strategist and visionary, Mr Porkoshenko said on 25th of May: It is not a question of days, weeks, or months, when rebellion in East Ukraine will be defeated. It is the question of hours.... .

Ricardo 6 months ago

Volunteers, revolutionaries, zealots, idealist, mercenaries are all drawn to conflicts all over the globe. Muslims are headed to Syria and Iraq from Europe and North Africa to fight either Assad or along side ISIS, now those that believe the days of the old USSR are returning are headed to eastern Ukraine to fight. If you look at some of the countries mentioned in this article it will not surprise anyone that they are all from Soviet/Russian supported countries that even after the collapse of the USSR still follow the Russians, no matter the consequences to their country.

[Dec 05, 2016] Government Warmongering Criminals Where Are They Now

Notable quotes:
"... The American people and most of the world bought into the lies and half-truths because they wanted to believe the fiction they were being spoon fed by the White House, but is there a whole lot of difference between what the US government did against Iraq in 2003 and what Hitler's government did in 1939 when it falsely claimed that Polish troops had attacked Germany? Was subsequent torture by the Gestapo any different than torture by a contractor working for Washington? ..."
"... A friend of mine recently commented that honest men who were formerly part of the United States government do not subsequently get hired by lobbying firms or obtain television contracts and "teaching" positions at prestigious universities. ..."
"... If the marketplace is anything to go by Feith and Tenet are running neck-and-neck on secondary book exchanges as George also can be had for $.01. ..."
"... The historian Livy summed up the significance of his act, writing "It is worthwhile for those who disdain all human things for money, and who suppose that there is no room either for great honor or virtue, except where wealth is found, to listen to his story." ..."
"... "Power is always dangerous. Power attracts the worst and corrupts the best." ..."
"... senior government officials and politicians routinely expect to be generously rewarded for their service and never held accountable for their failures and misdeeds ..."
"... One thing for sure about the Washington elite, you never have to say you're sorry. ..."
Jul 08, 2015 | The Ron Paul Institute for Peace and Prosperity

The United States already has by far the per capita largest prison population of any developed country but I am probably one of the few Americans who on this Independence Day would like to see a lot more people in prison, mostly drawn from politicians and senior bureaucrats who have long believed that their status makes them untouchable, giving them license to steal and even to kill. The sad fact is that while whistleblowers have been imprisoned for revealing government criminality, no one in the federal bureaucracy has ever actually been punished for the crimes of torture, kidnapping and assassination committed during the George W. Bush and Barack H. Obama presidencies.

Why is accountability important? After the Second World War, the victorious allies believed it was important to establish responsibility for the crimes that had been committed by officials of the Axis powers. The judges at the Nuremberg Trials called the initiation of a war of aggression the ultimate war crime because it inevitably unleashed so many other evils. Ten leading Nazis were executed at Nuremberg and ninety-three Japanese officials at similar trials staged in Asia, including several guilty of waterboarding. Those who were not executed for being complicit in the actual launching of war were tried for torture of both military personnel and civilians and crimes against humanity, including the mass killing of civilians as well as of soldiers who had surrendered or been captured.

No matter how one tries to avoid making comparisons between 1939 and 2015, the American invasion of Iraq was a war of aggression, precisely the type of conflict that the framework of accountability provided by Nuremberg was supposed to prevent in the years after 1946. High level US government officials knew that Iraq represented no threat to the United States but they nevertheless described an imminent danger posed by Saddam Hussein in the most graphic terms, replete with weapons of mass destruction, armed drones flying across the Atlantic, terrorists being unleashed against the homeland, and mushroom clouds on the horizon. The precedent of Iraq, even though it was an abject failure, has led to further military action against Libya and Syria to bring about "regime change" as well as a continuing conflict in Afghanistan.

Meanwhile, the US has been waging a largely secret "long war" against terrorists employing torture and secret prisons. The American people and most of the world bought into the lies and half-truths because they wanted to believe the fiction they were being spoon fed by the White House, but is there a whole lot of difference between what the US government did against Iraq in 2003 and what Hitler's government did in 1939 when it falsely claimed that Polish troops had attacked Germany? Was subsequent torture by the Gestapo any different than torture by a contractor working for Washington?

Many Americans would now consider the leading figures in the Bush Administration aided and abetted by many enablers in congress from both political parties to be unindicted war criminals. Together they ignited a global conflict that is still running strong fourteen years later with a tally of more than 7,000 dead Americans and a minimum of hundreds of thousands of dead Iraqis, Afghans, Libyans, Somalis and Syrians.

War breeds more war, due largely to the fact that guilty parties in Washington who piggyback on the prevailing narrative move onward and upward, rewarded in this life even if not necessarily so in the hereafter. A friend of mine recently commented that honest men who were formerly part of the United States government do not subsequently get hired by lobbying firms or obtain television contracts and "teaching" positions at prestigious universities. Though not 100% accurate as I know at least a couple of honorable former senior officials who wound up teaching, it would seem to be a generalization that has considerable validity. The implication is that many senior government officials ascend to their positions based on being accommodating and "political" rather than being honest and they continue to do the same when they switch over to corporate America or the equally corrupted world of academia.

I thought of my friend's comment when I turned on the television a week ago to be confronted by the serious, somewhat intense gaze of Michael Morell, warning about the danger that ISIS will strike the US over the Fourth of July weekend. Morell, a former senior CIA official, is in the terror business. He had no evidence whatsoever that terrorists were planning an attack and should have realized that maneuvering the United States into constantly going on alert based on empty threats is precisely what militant groups tend to do.

When not fronting as a handsomely paid national security consultant for the CBS television network Morell is employed by Beacon Global Strategies as a Senior Counselor, presumably warning well-heeled clients to watch out for terrorists. His lifestyle and substantial emoluments depend on people being afraid of terrorism so they will turn to an expert like him and ask serious questions that he will answer in a serious way suggesting that Islamic militants could potentially bring about some kind of global apocalypse.

Morell, a torture apologist, also has a book out that he wants to sell, positing somewhat ridiculously that he and his former employer had been fighting The Great War of Our Time against Islamic terrorists, something comparable to the World Wars of the past century, hence the title. Morell needs to take some valium and relax. He would also benefit from a little introspection regarding the bad guys versus good guys narrative that he is peddling. His credentials as a warrior are somewhat suspect in any event as he never did any military service and his combat in the world of intelligence consisted largely of sitting behind a desk in Washington and providing briefings to George W. Bush and Barack Obama in which he presumably told them what they wanted to hear.

Morell is one of a host of pundits who are successful in selling the military-industrial-lobbyist-congressional-intelligence community line of BS on the war on terror. Throw in the neocons as the in-your-face agents provocateurs who provide instant intellectual and media credibility for developments and you have large groups of engaged individuals with good access who are on the receiving end of the seemingly unending cash pipeline that began with 9/11. Frances Townsend, who was the Bush Homeland Security adviser and who is now a consultant with CNN, is another such creature as is Michael Chertoff, formerly Director of the Department of Homeland Security, who has successfully marketed his defective airport scanners to his former employer.

But the guys and gals who are out feathering their own nests are at least comprehensible given our predatory capitalist system of government. More to the point, the gang that ordered or carried out torture and assassination are the ones who should be doing some hard time in the slammer but instead they too are riding the gravy train and cashing in. To name only a few of those who knew about the torture and ordered it carried out I would cite George Tenet, James Pavitt, Cofer Black and Jose Rodriguez from the intelligence community. The assassination program meanwhile is accredited to John Brennan, currently CIA Director, during his tenure as Obama's Deputy National Security Advisor. And then there are Doug Feith and Paul Wolfowitz at the Pentagon together with John Yoo at Justice and Scooter Libby, Dick Cheney, and Condi Rice at the White House, all of whom outright lied, dissimulated and conspired their way to bring about a war of aggression against Iraq.

There are plenty of nameless others who were "only carrying out orders" and who should be included in any reckoning of America's crimes over the past fifteen years, particularly if one also considers the illegal NSA spying program headed by Michael Hayden, who defended the practice and has also referred to those who oppose enhanced interrogation torture as "interrogation deniers." And then there are Presidents Bush and Obama who certainly knew what was going on in the name of the American people as well as John Brennan, who was involved in both the torture and renditions programs as well as the more recent assassinations by drone.

So where are they now? Living in obscurity ashamed of what they did? Hardly. Not only have they not been vilified or marginalized, they have, in most cases, been rewarded. George W. Bush lives in Dallas near his Presidential Library and eponymous Think (sic) Tank. Cheney lives in semi-retirement in McLean Virginia with a multi-million dollar waterfront weekend retreat in St. Michaels Maryland, not too far from Donald Rumsfeld's similar digs.

George Tenet, the CIA Director notorious for his "slam-dunk" comment, a man who cooked the intelligence to make the Iraq war possible to curry favor with the White House, has generously remunerated positions on the boards of Allen & Company merchant bank, QinetiQ, and L-1 Identity Solutions. He sold his memoir At the Center of the Storm, which has been described as a "self-justifying apologia," in 2007 for a reported advance of $4 million. His book, ironically, admits that the US invaded Iraq for no good reason.

James Pavitt, who was the point man responsible for the "enhanced interrogation" program as Tenet's Deputy Director for Operations, is currently a principal with The Scowcroft Group and also serves on several boards. Cofer Black, who headed the Counter-Terrorism Center, which actually carried out renditions and "enhanced interrogations," was vice chairman of Blackwater Worldwide (now called Xe) and chairman of Total Intelligence Solutions, a Blackwater spin-off. He is now vice president of Blackbird Technologies, a defense and intelligence contractor. Rodriguez, who succeeded Black and in 2005 illegally destroyed video tapes made of Agency interrogations to avoid possible repercussions, is a senior vice president with Edge Consulting, a defense contractor currently owned by IBM that is located in Virginia.

John Yoo is a Professor of Law at the University of California Berkeley while Condoleezza Rice, who spoke of mushroom clouds and is widely regarded as the worst National Security Advisor and Secretary of State in history, has returned to Stanford University. She is a professor at the Graduate School of Business and a director of its Global Center for Business and the Economy as well as a fellow at the Hoover Institution. She is occasionally spoken of as either a possible GOP presidential candidate or as a future Commissioner of the National Football League. Her interaction with students is limited, but when challenged on her record she has responded that it was a difficult situation post 9/11, something that everyone understands, though few would have come to her conclusion that attacking Iraq might be a good way to destroy al-Qaeda.

Paul Wolfowitz, the Bush Deputy Secretary of Defense, is seen by many as the "intellectual" driving force behind the invasion of Iraq. He is currently a visiting scholar at the American Enterprise Institute and advises Jeb Bush on foreign policy. A bid to reward Wolfie for his zeal by giving him a huge golden parachute as President of the World Bank at a salary of $391,000 tax free failed when, after 23 months in the position, he was ousted over promoting a subordinate with whom he was having an affair. His chief deputy at the Pentagon Doug Feith left the Defense Department to take up a visiting professorship at the school of Foreign Service at Georgetown University, which was subsequently not renewed. He is reported to be again practicing law and thinking deep thoughts about his hero Edmund Burke, who no doubt would have been appalled to make Feith's acquaintance. Feith is a senior fellow at the neoconservative Hudson Institute and the Director of the Center for National Security Strategies. His memoir War and Decision did not make the best seller list and is now available used on Amazon for $.01 plus shipping. If the marketplace is anything to go by Feith and Tenet are running neck-and-neck on secondary book exchanges as George also can be had for $.01.

The over-rewarding of former officials who have in reality done great harm to the United States and its interests might well seem inexplicable, but it is all part of a style of bureaucracy that cannot admit failure and truly believes that all its actions are ipso facto legitimate because the executive and its minions can do no wrong. It is also a symptom of the classic American character flaw that all things are of necessity measured by money. Does anyone remember the ancient Roman symbol of republican virtue Lucius Quinctius Cincinnatus, who left his farm after being named Dictator in order to defeat Rome's enemies? He then handed power back to the Senate before returning to his plowing after the job was done. The historian Livy summed up the significance of his act, writing "It is worthwhile for those who disdain all human things for money, and who suppose that there is no room either for great honor or virtue, except where wealth is found, to listen to his story." George Washington was America's Cincinnatus and it is not a coincidence that officers of the continental army founded the Cincinnati Society, the nation's oldest patriotic organization, in 1783. It is also reported that Edward Snowden used the alias "Cincinnatus."

Lord Acton once observed that "Power tends to corrupt and absolute power corrupts absolutely." More recently essayist Edward Abbey put it in an American context, noting "Power is always dangerous. Power attracts the worst and corrupts the best." That senior government officials and politicians routinely expect to be generously rewarded for their service and never held accountable for their failures and misdeeds is a fault that is perhaps not unique to the United States but it is nevertheless unacceptable. Handing out a couple of exemplary prison sentences for the caste that believes itself untouchable would be a good place to start. An opportunity was missed with David Petraeus, who was fined and avoided jail time, and it will be interesting to see how the Dennis Hastert case develops. Hastert will no doubt be slapped on the wrist for the crime of moving around his own money while the corruption that was the source of that money, both as a legislator and lobbyist, will be ignored. As will his molestation of at least one and possibly several young boys. One thing for sure about the Washington elite, you never have to say you're sorry.

Reprinted with permission from Unz Review.

[Dec 05, 2016] The internet is at risk of transforming from an open platform to myriad national networks

Notable quotes:
"... Far from being seen as the guardian of a free and open online medium, the US has been painted as an oppressor, cynically using its privileged position to spy on foreign nationals. The result, warn analysts, could well be an acceleration of a process that has been under way for some time as other countries ringfence their networks to protect their citizens' data and limit the flow of information. ..."
"... At the most obvious level, the secret data-collection efforts being conducted by the US National Security Agency threaten to give would-be censors of the internet in authoritarian countries rhetorical cover as they put their own stamp on their local networks. ..."
"... But the distrust of the US that the disclosures are generating in the democratic world, including in Europe , are also likely to have an impact. From the operation of a nation's telecoms infrastructure to the regulation of the emerging cloud computing industry, changes in the architecture of networks as countries seek more control look set to cause a sea change in the broader internet. ..."
www.ft.com

Revelations about US surveillance of the global internet – and the part played by some of the biggest American internet companies in facilitating it – have stirred angst around the world.

Far from being seen as the guardian of a free and open online medium, the US has been painted as an oppressor, cynically using its privileged position to spy on foreign nationals. The result, warn analysts, could well be an acceleration of a process that has been under way for some time as other countries ringfence their networks to protect their citizens' data and limit the flow of information.

"It is difficult to imagine the internet not becoming more compartmentalised and Balkanised," says Rebecca MacKinnon, an expert on online censorship. "Ten years from now, we will look back on the free and open internet" with nostalgia, she adds.

At the most obvious level, the secret data-collection efforts being conducted by the US National Security Agency threaten to give would-be censors of the internet in authoritarian countries rhetorical cover as they put their own stamp on their local networks.

But the distrust of the US that the disclosures are generating in the democratic world, including in Europe, are also likely to have an impact. From the operation of a nation's telecoms infrastructure to the regulation of the emerging cloud computing industry, changes in the architecture of networks as countries seek more control look set to cause a sea change in the broader internet.

[Dec 05, 2016] How we define the Neoliberal Era

Notable quotes:
"... When societies take the restraints off competition and free markets, inequality follows in its wake. It happened in the Gilded Age and it happened in the Neoliberal Era. the picture of competition leading to leveling is a jejune textbook fantasy. ..."
Dec 15, 2015 | Economist's View

pgl said...

"To some extent that's correct, but competitive capitalism is not divisive. In fact, it is just the opposite. Competition is a great leveling force. For example, when a firm discovers something new, other firms, if they can, will copy it and duplicate the innovation. If a firm finds a highly profitable strategy, other firms will mimic it and take some of those profits for themselves. A firm might temporarily separate itself from other firms in an industry, but competition will bring them back together. Sometimes there are impediments to this leveling process such as patents, monopoly power, and talent that is difficult to duplicate, but competition is always there, waiting and watching."

Nice defense of the market place with the appropriate caveat about how monopoly power can interfere with it to the benefit of the few. We should note there is monopsony power which at times impedes wages from rising. In such cases, unions and minimum wages can help not hurt. Which is a shout out to Seattle for letting Uber driving unionize.

DrDick ->pgl... December 15, 2015 at 10:00 AM
That really gets to my critique of capitalism. While Mark is certainly correct about emerging markets, mature capitalism inevitably trends toward monopoly/oligopoly where all the benefits disappear and we get the mess we are in today.
Dan Kervick ->DrDick... December 15, 2015 at 10:58 AM
When societies take the restraints off competition and free markets, inequality follows in its wake. It happened in the Gilded Age and it happened in the Neoliberal Era. the picture of competition leading to leveling is a jejune textbook fantasy.

Societies have sometimes succeeded in building broad prosperity and a fairly level distribution of income. They have done it by creating strong socializing institutions and laws that place restraints on individual economic liberty and accept the necessity of some degree of intelligent planning.

pgl ->Dan Kervick...
Yawn! Do define the "Neoliberal Era"? Is that the one where we passed anti-trust legislation or the one where it was gutted? No scratch that - we have had enough of your bloviating for one day.
likbez ->pgl... December 15, 2015 at 11:08 AM

"Do define the "Neoliberal Era"? "

I would define it as a perversion of Trotskyism -- Trotskyism for the rich.

See Washington consensus for the set of policies neoliberalism enforces:

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

Also see Wendy Brown interview What Exactly Is Neoliberalism to Dissent Magazine (Nov 03, 2015)

== some quotes ===

"... I treat neoliberalism as a governing rationality through which everything is "economized" and in a very specific way: human beings become market actors and nothing but, every field of activity is seen as a market, and every entity (whether public or private, whether person, business, or state) is governed as a firm. Importantly, this is not simply a matter of extending commodification and monetization everywhere-that's the old Marxist depiction of capital's transformation of everyday life. Neoliberalism construes even non-wealth generating spheres-such as learning, dating, or exercising-in market terms, submits them to market metrics, and governs them with market techniques and practices. Above all, it casts people as human capital who must constantly tend to their own present and future value. ..."

"... The most common criticisms of neoliberalism, regarded solely as economic policy rather than as the broader phenomenon of a governing rationality, are that it generates and legitimates extreme inequalities of wealth and life conditions; that it leads to increasingly precarious and disposable populations; that it produces an unprecedented intimacy between capital (especially finance capital) and states, and thus permits domination of political life by capital; that it generates crass and even unethical commercialization of things rightly protected from markets, for example, babies, human organs, or endangered species or wilderness; that it privatizes public goods and thus eliminates shared and egalitarian access to them; and that it subjects states, societies, and individuals to the volatility and havoc of unregulated financial markets. ..."

"... with the neoliberal revolution that homo politicus is finally vanquished as a fundamental feature of being human and of democracy. Democracy requires that citizens be modestly oriented toward self-rule, not simply value enhancement, and that we understand our freedom as resting in such self-rule, not simply in market conduct. When this dimension of being human is extinguished, it takes with it the necessary energies, practices, and culture of democracy, as well as its very intelligibility. ..."

"... For most Marxists, neoliberalism emerges in the 1970s in response to capitalism's falling rate of profit; the shift of global economic gravity to OPEC, Asia, and other sites outside the West; and the dilution of class power generated by unions, redistributive welfare states, large and lazy corporations, and the expectations generated by educated democracies. From this perspective, neoliberalism is simply capitalism on steroids: a state and IMF-backed consolidation of class power aimed at releasing capital from regulatory and national constraints, and defanging all forms of popular solidarities, especially labor. ..."

"... The grains of truth in this analysis don't get at the fundamental transformation of social, cultural, and individual life brought about by neoliberal reason. They don't get at the ways that public institutions and services have not merely been outsourced but thoroughly recast as private goods for individual investment or consumption. And they don't get at the wholesale remaking of workplaces, schools, social life, and individuals. For that story, one has to track the dissemination of neoliberal economization through neoliberalism as a governing form of reason, not just a power grab by capital. There are many vehicles of this dissemination -- law, culture, and above all, the novel political-administrative form we have come to call governance. It is through governance practices that business models and metrics come to irrigate every crevice of society, circulating from investment banks to schools, from corporations to universities, from public agencies to the individual. It is through the replacement of democratic terms of law, participation, and justice with idioms of benchmarks, objectives, and buy-ins that governance dismantles democratic life while appearing only to instill it with "best practices." ..."

"... Progressives generally disparage Citizens United for having flooded the American electoral process with corporate money on the basis of tortured First Amendment reasoning that treats corporations as persons. However, a careful reading of the majority decision also reveals precisely the thoroughgoing economization of the terms and practices of democracy we have been talking about. In the majority opinion, electoral campaigns are cast as "political marketplaces," just as ideas are cast as freely circulating in a market where the only potential interference arises from restrictions on producers and consumers of ideas-who may speak and who may listen or judge. Thus, Justice Kennedy's insistence on the fundamental neoliberal principle that these marketplaces should be unregulated paves the way for overturning a century of campaign finance law aimed at modestly restricting the power of money in politics. Moreover, in the decision, political speech itself is rendered as a kind of capital right, functioning largely to advance the position of its bearer, whether that bearer is human capital, corporate capital, or finance capital. This understanding of political speech replaces the idea of democratic political speech as a vital (if potentially monopolizable and corruptible) medium for public deliberation and persuasion. ..."

"... My point was that democracy is really reduced to a whisper in the Euro-Atlantic nations today. Even Alan Greenspan says that elections don't much matter much because, "thanks to globalization . . . the world is governed by market forces," not elected representatives. ..."

Syaloch ->Dan Kervick...
I like where you're going, but your narrative here has a few problems:

"When societies take the restraints off competition and free markets, inequality follows in its wake."

Free markets have restraints? Then they're not really "free", are they? And isn't that the point?

"They have done it by creating strong socializing institutions and laws that place restraints on individual economic liberty..."

I think Mark is defining economic liberty as the opposite of what you have in mind:

"The system works best when people have the freedom to enter a new business (if they have the means and are willing to take the risk). It works best when people compete for jobs on equal footing, have access to the same opportunities, when there are no artificial barriers in society that prevent people from reaching their full potential."

Why not just say that strong socializing institutions and laws *increase* economic freedom?

DrDick ->Syaloch...
More to the point, "free markets" (largely unregulated) do not, have never, and cannot exist as a viable system. Strong government regulation is essential to their viability.

Dan Kervick ->Syaloch...
Jeff Bezos had the freedom to create and enter a new business, and now he's a multi-gazillionaire who uses his monopoly power to dictate terms. Mark Zuckerberg and the Koch brothers have used their economic freedom to make themselves spectacularly wealthy and then move to buy control over political processes.

The textbook picture of competition doesn't match reality. In that picture the competitive economy is like an eternal game between equals. The players come and go, but no one ever wins. The game goes on and on and on and on, and the conditions of the players is always parity.

I don't know where economists came by this picture, but that's not what happens in most instances in the real world. Generally, if you start out with a bunch of even competitors on a competitive economic field, they will compete until one player defeats all of the others and rules the field. Along the way, tacit coalitions will be built to gang up on the largest competitor and drive out all of the small fry. The system tends with certainty toward oligopoly, if not always to monopoly. The only way you can approximate enduring conditions of perfect competition is by rigging the game with a bunch of highly restrictive rules designed to prevent human nature from taking its course. For example, the ancient Greeks had a rule which allowed them to ostracize citizens who had gotten too big.

I'm by no means arguing to get rid of private enterprise. But other countries have managed to make intelligent use of restrained capitalist mechanisms within a more civilized and enlightened social order. The United States has become an insane country: fanatically violent, aggressive, uncivilized, nasty and anti-social. Conflict, competition and individual liberty are not effectively balanced by moral, religious and political institutions that inhibit the vicious and narcissistic tendencies of human beings. The popular image of the meaning of life perpetuated my the mass media is crass and nihilistic.

Dan Kervick ->Syaloch...
"Why not just say that strong socializing institutions and laws *increase* economic freedom?"

I agree there are different kinds of freedom. Some restrictions on the economic freedom of capitalists are enhancements of the workers' freedom not to live in fear of getting canned or impoverished.

But I really want to resist the doctrinal pressure in the US ideological system to cast everything in the language of freedom. There are other important human valuesin addition to freedom. And not every case in which people are given more choices makes them, or the people around them, happier.

likbez ->Syaloch...
The whole idea of "free markets" is an important neoliberal myth. Free for whom?

Only for multinationals. The first for opening markets for multinationals under the banner of "free markets" is the cornerstone of neoliberal ideology.

Free from what?

Free from regulation.

What about "fair markets" for a change?

ilsm ->DrDick...
US capitalism is not capitalism, it is exploitive greed and bankster plundering.
DrDick ->ilsm...
I agree with your characterization, but US capitalism is the only kind of actual capitalism that has ever actually existed. Everywhere else has tempered its excesses with a healthy dose of socialism.
pgl ->DrDick...
19th century UK was far more laissez faire than our current set of rules. No socialism there. Which was what Marx complained about.
DrDick ->pgl...
Which really makes my point, actually. You see the same basic patterns everywhere in the 19th century that you do in the US today. We have only mildly reined it in compared to most of the developed world.

[Dec 05, 2016] Capitalism Requires World War

www.zerohedge.com

It has been our undertaking, since 2010, to chronicle our understanding of capitalism via our book The Philosophy of Capitalism . We were curious as to the underlying nature of the system which endows us, the owners of capital, with so many favours. The Saker has asked me to explain our somewhat crude statement 'Capitalism Requires World War'.

The present showdown between West, Russia and China is the culmination of a long running saga that began with World War One. Prior to which, Capitalism was governed by the gold standard system which was international, very solid, with clear rules and had brought great prosperity: for banking Capital was scarce and so allocated carefully. World War One required debt-capitalism of the FIAT kind, a bankrupt Britain began to pass the Imperial baton to the US, which had profited by financing the war and selling munitions.

The Weimar Republic, suffering a continuation of hostilities via economic means, tried to inflate away its debts in 1919-1923 with disastrous results-hyperinflation. Then, the reintroduction of the gold standard into a world poisoned by war, reparation and debt was fated to fail and ended with a deflationary bust in the early 1930's and WW2.

The US government gained a lot of credibility after WW2 by outlawing offensive war and funding many construction projects that helped transfer private debt to the public book. The US government's debt exploded during the war, but it also shifted the power game away from creditors to a big debtor that had a lot of political capital. The US used her power to define the new rules of the monetary system at Bretton Woods in 1944 and to keep physical hold of gold owned by other nations.

The US jacked up tax rates on the wealthy and had a period of elevated inflation in the late 40s and into the 1950s – all of which wiped out creditors, but also ushered in a unique middle class era in the West. The US also reformed extraction centric institutions in Europe and Japan to make sure an extractive-creditor class did not hobble growth, which was easy to do because the war had wiped them out (same as in Korea).

Capital destruction in WW2 reversed the Marxist rule that the rate of profit always falls. Take any given market – say jeans. At first, all the companies make these jeans using a great deal of human labour so all the jeans are priced around the average of total social labour time required for production (some companies will charge more, some companies less).

One company then introduces a machine (costed at $n) that makes jeans using a lot less labour time. Each of these robot assisted workers is paid the same hourly rate but the production process is now far more productive. This company, ignoring the capital outlay in the machinery, will now have a much higher profit rate than the others. This will attract capital, as capital is always on the lookout for higher rates of profit. The result will be a generalisation of this new mode of production. The robot or machine will be adopted by all the other companies, as it is a more efficient way of producing jeans.

As a consequence the price of the jeans will fall, as there is an increased margin within which each market actor can undercut his fellows. One company will lower prices so as to increase market share. This new price-point will become generalised as competing companies cut their prices to defend their market share. A further n$ was invested but per unit profit margin is put under constant downward pressure, so the rate of return in productive assets tends to fall over time in a competitive market place.

Interest rates have been falling for decades in the West because interest rates must always be below the rate of return on productive investments. If interest rates are higher than the risk adjusted rate of return then the capitalist might as well keep his money in a savings account. If there is real deflation his purchasing power increases for free and if there is inflation he will park his money (plus debt) in an unproductive asset that's price inflating, E.G. Housing. Sound familiar? Sure, there has been plenty of profit generated since 2008 but it has not been recovered from productive investments in a competitive free market place. All that profit came from bubbles in asset classes and financial schemes abetted by money printing and zero interest rates.

Thus, we know that the underlying rate of return is near zero in the West. The rate of return falls naturally, due to capital accumulation and market competition. The system is called capitalism because capital accumulates: high income economies are those with the greatest accumulation of capital per worker. The robot assisted worker enjoys a higher income as he is highly productive, partly because the robotics made some of the workers redundant and there are fewer workers to share the profit. All the high income economies have had near zero interest rates for seven years. Interest rates in Europe are even negative. How has the system remained stable for so long?

All economic growth depends on energy gain. It takes energy (drilling the oil well) to gain energy. Unlike our everyday experience whereby energy acquisition and energy expenditure can be balanced, capitalism requires an absolute net energy gain. That gain, by way of energy exchange, takes the form of tools and machines that permit an increase in productivity per work hour. Thus GDP increases, living standards improve and the debts can be repaid. Thus, oil is a strategic capitalistic resource.

US net energy gain production peaked in 1974, to be replaced by production from Saudi Arabia, which made the USA a net importer of oil for the first time. US dependence on foreign oil rose from 26% to 47% between 1985 and 1989 to hit a peak of 60% in 2006. And, tellingly, real wages peaked in 1974, levelled-off and then began to fall for most US workers. Wages have never recovered. (The decline is more severe if you don't believe government reported inflation figures that don't count the costof housing.)

What was the economic and political result of this decline? During the 20 years 1965-85, there were 4 recessions, 2 energy crises and wage and price controls. These were unprecedented in peacetime and The Gulf of Tonkin event led to the Vietnam War which finally required Nixon to move away from the Gold-Exchange Standard in 1971, opening the next degenerate chapter of FIAT finance up until 2008. Cutting this link to gold was cutting the external anchor impeding war and deficit spending. The promise of gold for dollars was revoked.

GDP in the US increased after 1974 but a portion of end use buying power was transferred to Saudi Arabia. They were supplying the net energy gain that was powering the US GDP increase. The working class in the US began to experience a slow real decline in living standards, as 'their share' of the economic pie was squeezed by the ever increasing transfer of buying power to Saudi Arabia.

The US banking and government elite responded by creating and cutting back legal and behavioral rules of a fiat based monetary system. The Chinese appreciated the long term opportunity that this presented and agreed to play ball. The USA over-produced credit money and China over-produced manufactured goods which cushioned the real decline in the buying power of America's working class. Power relations between China and the US began to change: The Communist Party transferred value to the American consumer whilst Wall Street transferred most of the US industrial base to China. They didn't ship the military industrial complex.

Large scale leverage meant that US consumers and businesses had the means to purchase increasingly with debt so the class war was deferred. This is how over production occurs: more is produced that is paid for not with money that represents actual realized labour time, but from future wealth, to be realised from future labour time. The Chinese labour force was producing more than it consumed.

The system has never differed from the limits laid down by the Laws of Thermodynamics. The Real economy system can never over-produce per se. The limit of production is absolute net energy gain. What is produced can be consumed. How did the Chinese produce such a super massive excess and for so long? Economic slavery can achieve radical improvements in living standards for those that benefit from ownership. Slaves don't depreciate as they are rented and are not repaired for they replicate for free. Hundreds of millions of Chinese peasants limited their way of life and controlled their consumption in order to benefit their children. And their exploited life raised the rate of profit!

They began their long march to modern prosperity making toys, shoes, and textiles cheaper than poor women could in South Carolina or Honduras. Such factories are cheap to build and deferential, obedient and industrious peasant staff were a perfect match for work that was not dissimilar to tossing fruit into a bucket. Their legacy is the initial capital formation of modern China and one of the greatest accomplishments in human history. The Chinese didn't use net energy gain from oil to power their super massive and sustained increase in production. They used economic slavery powered by caloric energy, exchanged from solar energy. The Chinese labour force picked the World's low hanging fruit that didn't need many tools or machines. Slaves don't need tools for they are the tool.

Without a gold standard and capital ratios our form of over-production has grown enormously. The dotcom bubble was reflated through a housing bubble, which has been pumped up again by sovereign debt, printing press (QE) and central bank insolvency. The US working and middle classes have over-consumed relative to their share of the global economic pie for decades. The correction to prices (the destruction of credit money & accumulated capital) is still yet to happen. This is what has been happening since 1971 because of the growth of financialisation or monetisation.

The application of all these economic methods was justified by the political ideology of neo-Liberalism. Neo-Liberalism entails no or few capital controls, the destruction of trade unions, plundering state and public assets, importing peasants as domesticated help, and entrusting society's value added production to The Communist Party of The People's Republic of China.

The Chinese have many motives but their first motivation is power. Power is more important than money. If you're rich and weak you get robbed. Russia provides illustrating stories of such: Gorbachev had received a promise from George HW Bush that the US would pay Russia approximately $400 billion over10 years as a "peace dividend" and as a tool to be utilized in the conversion of their state run to a market based economic system. The Russians believe the head of the CIA at the time, George Tenet, essentially killed the deal based on the idea that "letting the country fall apart will destroy Russia as a future military threat". The country fell apart in 1992. Its natural assets were plundered which raised the rate of profit in the 90's until President Putin put a stop to the robbery.

In the last analysis, the current framework of Capitalism results in labour redundancy, a falling rate of profit and ingrained trading imbalances caused by excess capacity. Under our current monopoly state capitalism a number of temporary preventive measures have evolved, including the expansion of university, military, and prison systems to warehouse new generations of labour.

Our problem is how to retain the "expected return rate" for us, the dominant class. Ultimately, there are only two large-scale solutions, which are intertwined .

One is expansion of state debt to keep "the markets" moving and transfer wealth from future generations of labour to the present dominant class.

The other is war, the consumer of last resort. Wars can burn up excess capacity, shift global markets, generate monopoly rents, and return future labour to a state of helplessness and reduced expectations. The Spanish flu killed 50-100 million people in 1918. As if this was not enough, it also took two World Wars across the 20th century and some 96 million dead to reduce unemployment and stabilize the "labour problem."

Capitalism requires World War because Capitalism requires profit and cannot afford the unemployed . The point is capitalism could afford social democracy after the rate of profit was restored thanks to the depression of the 1930's and the physical destruction of capital during WW2. Capitalism only produces for profit and social democracy was funded by taxing profits after WW2.

Post WW2 growth in labour productivity, due to automation, itself due to oil & gas replacing coal, meant workers could be better off. As the economic pie was growing, workers could receive the same %, and still receive a bigger slice. Wages as a % of US GDP actually increased in the period, 1945-1970. There was an increase in government spending which was being redirected in the form of redistributed incomes. Inequality will only worsen, because to make profits now we have to continually cut the cost of inputs, i.e. wages & benefits. Have we not already reached the point where large numbers of the working class can neither feed themselves nor afford a roof over their heads?13% of the UK working age population is out of work and receiving out of work benefits. A huge fraction is receiving in work benefits because low skill work now pays so little.

The underlying nature of Capitalism is cyclical. Here is how the political aspect of the cycle ends:

If Capitalism could speak, she would ask her older brother, Imperialism, this: "Can you solve the problem?" We are not reliving the 1930's, the economy is now an integrated whole that encompasses the entire World. Capital has been accumulating since 1945, so under- and unemployment is a plague everywhere. How big is the problem? Official data tells us nothing, but the 47 million Americans on food aid are suggestive. That's 1 in 7 Americans and total World population is 7 billion.

The scale of the solution is dangerous. Our probing for weakness in the South China Sea, Ukraine and Syria has awakened them to their danger.The Chinese and Russian leadershave reacted by integrating their payment systems and real economies, trading energy for manufactured goods for advanced weapon systems. As they are central players in the Shanghai Group we can assume their aim is the monetary system which is the bedrock of our Imperial power. What's worse, they can avoid overt enemy action and simply choose to undermine "confidence" in the FIAT.

Though given the calibre of their nuclear arsenal, how can they be fought let alone defeated? Appetite preceded Reason, so Lust is hard to Reason with. But beware brother. Your Lust for Power began this saga, perhaps it's time to Reason.

Uncle Sugar

Seriously - Having a Central Bank with a debt based monetary system requires permanent wars. True market based capitalism does not.

Father Thyme

Your logical fallacy is no true scotsman
http://yourlogicalfallacyis.com/no-true-scotsman

Wed, 03/02/2016 - 23:21 | 7264475 Seek_Truth

Those who live in glass houses shouldn't throw stones.

If wealth were measured by creating strawmen- you would be a Rothschild.

gwiss

That's because they don't understand the word "capitalism."

Capitalism simply means economic freedom. And economic freedom, just like freedom to breed, must be exposed to the pruning action of cause and effect, otherwise it outgrows its container and becomes unstable and explodes. As long as it is continually exposed to the grinding wheel of causality, it continues to hold a fine edge, as the dross is scraped away and the fine steel stays. Reality is full of dualities, and those dualities cannot be separated without creating broken symmetry and therefore terminal instability. Freedom and responsibility, for example. One without the other is unstable. Voting and taxation in direct proportion to each other is another example.

Fiat currency is an attempt to create an artificial reality, one without the necessary symmetry and balance of a real system. However, reality can not be gamed, because it will produce its own symmetry if you try to deny it. Thus the symmetry of fiat currency is boom and bust, a sine wave that still manages to produce equilibrium, however at a huge bubbling splattering boil rather than a fine simmer.

The folks that wrote this do not have a large enough world view. Capitalism does not require world wars because freedom does not require world wars. Freedom tends to bleed imbalances out when they are small. On the other hand, empire does require world war, which is why we are going to have one.

Wed, 03/02/2016 - 23:27 | 7264485 GRDguy

Capitalism becomes imperialism when financial sociopaths steal profits from both sides of the trade. What you're seeing is an Imperialism of Capital, as explained very nicely in the 1889 book "The Great Red Dragon."

AchtungAffen

Really? I thought that was the re-prints of Mises Canada, Kunstler or Brandon Smith. In comparison, this article is sublime.

Caviar Emptor

Wrong. Capitalism needs prolonged directionless wars without clear winners and contained destruction that utilize massive amounts of raw materials and endless orders for weapons and logistical support. That's what makes some guys rich.

Wed, 03/02/2016 - 22:56 | 7264423 Jack's Raging B...

That's was a very long-winded and deliberately obtuse way of explaining how DEBT AS MONEY and The State's usurpation of sound money destroyed efficient markets. The author then goes to call this system Capitalism.

So yeah, the deliberate destruction of capital, in all its forms, is somehow capitalism. Brilliant observation. Fuck you. There are better terms for things like this. Perhaps....central banking? The State? Fiat debt creation? Evil? Naw, let's just contort and abuse language instead. That's the ticket.

My Days Are Get...

From Russia News Feed:

Cathal Haughian Bio :

I've spent my adult life in 51 countries. This was financed by correctly anticipating the Great Financial Crisis in 2008. I was studying Marx at that time. I'm presently an employee of the Chinese State. I educate the children of China's best families. I am the author, alongside a large international team of capitalists, of Before The Collapse : The Philosophy of Capitalism.

I also have my own business; I live with my girlfriend and was born and grew up in Ireland.

===============

Why would anyone waste time to read this drivel, buttressed by the author's credentials.

The unstated thesis is that wars involve millions of actors, who produce an end-result of many hundreds of millions killed.

Absent coercion ("the Draft"), how is any government going to man hundreds of divisions of foot soldiers. That concept is passé.

Distribute some aerosol poisons via drones and kill as many people as deemed necessary. How in the hell will that action stimulate the world economy.

Weapons of mass-destruction are smaller, cheaper and easier to deploy. War as a progenitor of growth - forget it.

The good news is that this guy is educating the children of elite in China. Possibly the Pentagon could clone him 10,000 times and send those cyborgs to China - cripple China for another generation or two.

slimycorporated...

Capitalism requires banks that made shitty loans to fail

Ms No

The term cyclical doesn't quite cover what we have being experiencing. It's more like a ragdoll being shaken by a white shark. The euphoria of bubble is more like complete unhinged unicorn mania anymore and the lows are complete grapes of wrath. It's probably always been that way to some extent because corruption has remained unchallenged for a great deal of time. The boom phases are scarier than the downturns anymore, especially the last oil boom and housing boom. Complete Alfred Hitchcock stuff.

I don't think it's capitalism and that term comes across as an explanation that legitimizes this completely contrived pattern that benefits a few and screws everybody else. Markets should not be behaving in such a violent fashion. Money should probably be made steady and slow. And downturns shouldn't turn a country into Zimbabwe. I could be wrong but there is really no way to know with the corruption we have.

Good times.

o r c k

And War requires that an enemy be created. According to American General Breedlove-head of NATO's European Command-speaking to the US Armed Services Committee 2 days ago, "Russia and Assad are deliberately weaponizing migration to break European resolve". "The only reason to use non-precision weapons like barrel bombs is to keep refugees on the move". "These refugees bring criminality, foreign fighters and terrorism", and "are being used to overwhelm European structures". "Russia has chosen to be an adversary and is a real threat." "Russia is irresponsible with nuclear weapons-always threatening to use them." And strangely, "In the past week alone, Russia has made 450 attacks along the front lines in E. Ukraine".

Even with insanity overflowing the West, I found these comments to be the most bizarrely threatening propaganda yet. After reading them for the first time, I had to prove to myself that I wasn't hallucinating it.

[Dec 05, 2016] The US grand strategy post-Bush was to reposition itself at the heart of a liberal economic system excluding China through TTIP with the EU and TPP with Asia-Pac ex. China and Russia. The idea was that this would enable the US to sustain its hegemony.

Notable quotes:
"... It has been an absolute failure. Brexit has torpedoed TTIP and TPP has limited value - the largest economy in the partnership, Japan, has been largely integrated in to the US for the past 70 years. ..."
"... IMO the biggest failure of the US has been hating Russia too much. The Russians have just as much reason to be afraid of China ..."
"... It's old Cold War thinking that has seen America lose its hegemony -- similar to how the British were so focused on stopping German ascendancy they didn't see the Americans coming with the knife. ..."
Sep 27, 2016 | discussion.theguardian.com
Dante5 1d ago
The US grand strategy post-Bush was to reposition itself at the heart of a liberal economic system excluding China through TTIP with the EU and TPP with Asia-Pac ex. China and Russia. The idea was that this would enable the US to sustain its hegemony.

It has been an absolute failure. Brexit has torpedoed TTIP and TPP has limited value - the largest economy in the partnership, Japan, has been largely integrated in to the US for the past 70 years.

IMO the biggest failure of the US has been hating Russia too much. The Russians have just as much reason to be afraid of China as the US do and have a pretty capable army.

If the US patched things up with the Russians, firstly it could redeploy forces and military effort away from the Middle East towards Asia Pac and secondly it would give the US effective leverage over China -- with the majority of the oil producing nations aligned with the US, China would have difficulty in conducted a sustained conflict.

It's old Cold War thinking that has seen America lose its hegemony -- similar to how the British were so focused on stopping German ascendancy they didn't see the Americans coming with the knife.

[Dec 05, 2016] Fareed Zakaria Is Confused on Trade and the TPP

Notable quotes:
"... The real problem is the Chinese do not believe in economic profits, just market rates of return on invested capital which to be honest is only about 2-5% depending on risk. ..."
Jul 20, 2015 | economistsview.typepad.com
July 20, 2015
anne :

No one disputes the need for more official infrastructure funding :

What we find the most interesting is that the AIIB founders didn't ask member countries to approve an expansion of either the World Bank or the ADB. Instead, they opted for a new organization altogether.
Why? The problem is institutional legitimacy arising from issues of power and governance :

-- Cecchetti & Schoenholtz

[ Why? Because when all is said and done the United States wants to be able to control the Asian Development Bank, the IMF and World Bank and use them to in turn "control" countries that it wishes to be subject to the US but especially to control China as the New York Times editorial board made clear today in supporting Japanese militarism. *

* http://www.nytimes.com/2015/07/20/opinion/japan-wrestles-with-its-pacifism.html ]

anne -> anne :

No one disputes the need for more official infrastructure funding :

-- Cecchetti & Schoenholtz

[ Unless the word "official" suffices as an excuse, of course United States and British policy makers in particular dispute the need for more government supported infrastructure funding. Amartya Sen and Vijay Prashad have made this entirely clear for India. *

* http://www.nytimes.com/2013/06/20/opinion/why-india-trails-china.html ]

mulp -> anne :

The real problem is the Chinese do not believe in economic profits, just market rates of return on invested capital which to be honest is only about 2-5% depending on risk.

Americans demand monopoly profits and ROIC so high that the price of capital assets rapidly inflates.

Thus China's high speed rail plans are evil because China is advocating high volumes of HSR construction that costs decline by economies of scale leading to the replacement cost of any existing rail line being lower than original cost so the result is capital depreciation lower the price of assets, tangible and intangible, and the frantic pace of creating jobs and building more capital - more rail - eliminates any monopoly power of any rail system, thereby forcing revenues down to costs with the recovery of investment cost stretched to decades, and ROIC forced toward zero.

And it's that policy of investing to eliminate profits that drives conservatives insane. They scream, "it is bankrupt because those hundred year lifetime assets are not paying for themselves and generating stock market gains in seven years!"

Its like banking was from circa 1930 to 1980! It is like utility regulation was from 1930 to 1980! How can wealth be created when monopoly power is thwarted?!?

Just imagine how devastating if China uses the AIIB to build a rail network speeding goods between China and the tip of Africa and every place in between! Highly destructive of wealth.

anne -> mulp :

Interesting argument that I will carefully think through and argue with in turn. Nice, nice comment.

anne -> mulp :

Terrific comment, which should be further developed; I am thinking.

anne -> mulp :

Though I want to smooth the writing and terminology, I completely agree. Again, a terrific thoroughly enlightening comment. ]

anne :

And :after failing to stop the AIIB, and refusing to participate as a founding member, the United States should join the institution as soon as it can, participating actively in holding it to the highest 21st century standards :.

-- Cecchetti & Schoenholtz

[ Surely the IMF and the like are responsible for the "explosive" 38 year growth in real per capita Gross Domestic Product and 35 year growth in total factor productivity from Mexico, neighbor to the United States, to the Philippines, to Kenya : ]

anne -> anne :

https://research.stlouisfed.org/fred2/graph/?g=1pbp

August 4, 2014

Real per capita Gross Domestic Product for China, India, Brazil and South Africa, 1976-2014

(Percent change)


https://research.stlouisfed.org/fred2/graph/?g=1pbq

August 4, 2014

Real per capita Gross Domestic Product for China, India, Brazil and South Africa, 1976-2014

(Indexed to 1976)

anne -> anne :

http://research.stlouisfed.org/fred2/graph/?g=RZD

November 1, 2014

Total Factor Productivity at Constant National Prices for China, India, Brazil and South Africa, 1976-2011


http://research.stlouisfed.org/fred2/graph/?g=VJj

November 1, 2014

Total Factor Productivity at Constant National Prices for China, India, Brazil and South Africa, 1976-2011

(Indexed to 1976)

anne -> anne :

Even supposing analysts short of an Amartya Sen wish to be judicious in actually looking to the data of the last 38 years, as even Sen has found there is a price for arguing about the obvious importance of soft (social welfare spending) and hard institutional infrastructure spending in China:


http://research.stlouisfed.org/fred2/graph/?g=15Ie

August 4, 2014

Real per capita Gross Domestic Product for China and Mexico, 1976-2014

(Indexed to 1976)


https://research.stlouisfed.org/fred2/graph/?g=1tO2

August 4, 2014

Real per capita Gross Domestic Product for China and Philippines, 1976-2014

(Indexed to 1976)


https://research.stlouisfed.org/fred2/graph/?g=1tO3

August 4, 2014

Real per capita Gross Domestic Product for China and Kenya, 1976-2014

(Indexed to 1976)

anne :

And :after failing to stop the AIIB, and refusing to participate as a founding member, the United States should join the institution as soon as it can, participating actively in holding it to the highest 21st century standards :.

-- Cecchetti & Schoenholtz


https://research.stlouisfed.org/fred2/graph/?g=1qyT

August 4, 2014

Real per capita Gross Domestic Product for China, United States and
United Kingdom, 1976-2014

(Indexed to 1976)


http://research.stlouisfed.org/fred2/graph/?g=VJf

November 1, 2014

Total Factor Productivity at Constant National Prices for China,
United States and United Kingdom, 1976-2011

(Indexed to 1976)

anne :

No one disputes the need for more official infrastructure funding :

And :after failing to stop the AIIB, and refusing to participate as a founding member, the United States should join the institution as soon as it can, participating actively in holding it to the highest 21st century standards :.

-- Cecchetti & Schoenholtz

https://research.stlouisfed.org/fred2/graph/?g=1tiq

August 4, 2014

Real per capita Gross Domestic Product for United States, United
Kingdom, France, Netherlands, Germany and China, 1976-2014

(Indexed to 1976)


http://research.stlouisfed.org/fred2/graph/?g=197l

November 1, 2014

Total Factor Productivity at Constant National Prices for United
States, United Kingdom, France, Netherlands, Germany and China,
1976-2011

(Indexed to 1976)

anne :

No one disputes the need for more official infrastructure funding :

What we find the most interesting is that the AIIB founders didn't ask member countries to approve an expansion of either the World Bank or the ADB. Instead, they opted for a new organization altogether.

Why? The problem is institutional legitimacy arising from issues of power and governance :

-- Cecchetti & Schoenholtz


https://research.stlouisfed.org/fred2/graph/?g=1qsO

August 4, 2014

Real per capita Gross Domestic Product for China, Korea, Hong Kong and Singapore, 1976-2014

(Indexed to 1976)


http://research.stlouisfed.org/fred2/graph/?g=10zf

November 1, 2014

Total Factor Productivity at Constant National Prices for China,
Korea, Hong Kong and Singapore, 1976-2011

(Indexed to 1976)

anne :

No one disputes the need for more official infrastructure funding :

And :after failing to stop the AIIB, and refusing to participate as a founding member, the United States should join the institution as soon as it can, participating actively in holding it to the highest 21st century standards :.

-- Cecchetti & Schoenholtz


https://research.stlouisfed.org/fred2/graph/?g=1qzW

August 4, 2014

Real per capita Gross Domestic Product for Sweden, Denmark, Norway,
Finland and China, 1976-2014

(Indexed to 1976)


https://research.stlouisfed.org/fred2/graph/?g=1qzY

November 1, 2014

Total Factor Productivity at Constant National Prices for Sweden,
Denmark, Norway, Finland and China, 1976-2011

(Indexed to 1976)

anne :

No one disputes the need for more official infrastructure funding :

And :after failing to stop the AIIB, and refusing to participate as a founding member, the United States should join the institution as soon as it can, participating actively in holding it to the highest 21st century standards :.

-- Cecchetti & Schoenholtz


https://research.stlouisfed.org/fred2/graph/?g=1qE2

August 4, 2014

Real per capita Gross Domestic Product for Ireland, Portugal, Spain,
Italy, Greece and China, 1976-2014

(Indexed to 1976)


https://research.stlouisfed.org/fred2/graph/?g=1qE5

November 1, 2014

Total Factor Productivity at Constant National Prices for Ireland,
Portugal, Spain, Italy, Greece and China, 1976-2011

(Indexed to 1976)

anne :

No one disputes the need for more official infrastructure funding :

And :after failing to stop the AIIB, and refusing to participate as a founding member, the United States should join the institution as soon as it can, participating actively in holding it to the highest 21st century standards :.

-- Cecchetti & Schoenholtz


https://research.stlouisfed.org/fred2/graph/?g=1pco

August 4, 2014

Real per capita Gross Domestic Product for China, Japan and Korea, 1976-2014

(Indexed to 1976)


http://research.stlouisfed.org/fred2/graph/?g=VYR

November 1, 2014

Total Factor Productivity at Constant National Prices for China, Japan and Korea, 1976-2011

(Indexed to 1976)

kthomas :

yawn

anne :

Yawn

[ When did the United States experience 38 years of 8.6% real per capita GDP growth yearly? How about the United Kingdom? How about any other country? I have just begun, go ahead choose another country to go with China. I am waiting. Go ahead. I will include the astonishing total factor productivity growth as well. ]

anne :

While most of the G20 nations, including the big European states, Australia, and South Korea, are among the founding members, the United States, Japan, and Canada are noticeably not :

-- Cecchetti & Schoenholtz

[ I found it startling and discouraging that Greece virtually alone in Europe did not apply to be a founding member of the AIIB. ]

anne :

No one disputes the need for more official infrastructure funding :

And :after failing to stop the AIIB, and refusing to participate as a founding member, the United States should join the institution as soon as it can, participating actively in holding it to the highest 21st century standards :.

-- Cecchetti & Schoenholtz


https://research.stlouisfed.org/fred2/graph/?g=1q64

August 4, 2014

Real per capita Gross Domestic Product for China, United Kingdom,
Australia and Canada, 1976-2014

(Indexed to 1976)


http://research.stlouisfed.org/fred2/graph/?g=10fa

November 1, 2014

Total Factor Productivity at Constant National Prices for China,
United Kingdom, Australia and Canada, 1976-2011

(Indexed to 1976)

anne -> anne :

Yawn

[ I am still waiting, choose a country to go with China. ]

anne -> anne :

No one disputes the need for more official infrastructure funding :

And :after failing to stop the AIIB, and refusing to participate as a founding member, the United States should join the institution as soon as it can, participating actively in holding it to the highest 21st century standards :.

-- Cecchetti & Schoenholtz


https://research.stlouisfed.org/fred2/graph/?g=1tX6

August 4, 2014

Real per capita Gross Domestic Product for Indonesia, Philippines, Thailand and China, 1976-2014

(Indexed to 1976)


https://research.stlouisfed.org/fred2/graph/?g=1tX8

November 1, 2014

Total Factor Productivity at Constant National Prices for Indonesia, Philippines, Thailand and China, 1976-2011

(Indexed to 1976)

anne -> anne :

Yawn

[ Still waiting, choose a country to go with China. ]

Bruce Webb :

As to why the AIIB decided to go alone (at least without the US) it may have something to do with a fact that I stumbled on in relation to the Greece crisis. I am sure that most people here knew the basic fact and perhaps appreciate the irony but I didn't know whether to weep or laugh outright.

The U.S. only controls 17% of voting powers of the IMF. Why barely a sixth! Yet any positive decision requires an 85% vote. Meaning that in operational terms the U.S. might as well hold 51%.

You see similar things with NATO. It's a partnership that has high officers rotating in from here or there. But which requires that the overall NATO Commander be an American.

Nothing undemocratic or hegemonic here! Nope! Moving right along!

anne -> Bruce Webb :

The U.S. only controls 17% of voting powers of the IMF. Why barely a sixth! Yet any positive decision requires an 85% vote. Meaning that in operational terms the U.S. might as well hold 51%.

You see similar things with NATO. It's a partnership that has high officers rotating in from here or there. But which requires that the overall NATO Commander be an American.

Nothing undemocratic or hegemonic here! Nope! Moving right along!

[ Perfect and important. ]

anne -> Bruce Webb :

I am sure that most people here knew the basic fact and perhaps appreciate the irony but I didn't know whether to weep or laugh outright :.

[ No, in continually whining about the need for Asian Infrastructure Investment Bank to be transparent and democratic the United States was making sure never ever to explain the historic lack of transparency and anti-democratic nature of the IMF and World Bank and Asian Development Bank. ]

anne :

https://research.stlouisfed.org/fred2/graph/?g=1qtx

August 4, 2014

Real per capita Gross Domestic Product for Brazil, Argentina, Chile
and China, 1976-2014

(Indexed to 1976)


https://research.stlouisfed.org/fred2/graph/?g=1qtr

November 1, 2014

Total Factor Productivity at Constant National Prices for Brazil,
Argentina, Chile and China, 1976-2011

(Indexed to 1976)

anne :

https://research.stlouisfed.org/fred2/graph/?g=1tYy

August 4, 2014

Real per capita Gross Domestic Product for China, India and Turkey, 1976-2014

(Indexed to 1976)


http://research.stlouisfed.org/fred2/graph/?g=181Y

November 1, 2014

Total Factor Productivity at Constant National Prices for China, India and Turkey, 1976-2011

(Indexed to 1976)

[Dec 05, 2016] The geopolitical reasons for TPP, from Americas point of view, are pretty clear. It is a preemptive move against future China dominance in the region

Notable quotes:
"... Bill Clinton: "The geopolitical reasons for [TPP], from America's point of view, are pretty clear. It's designed to make sure that the future of the Asia-Pacific region, economically, is not totally dominated by China" ..."
"... " The full 40-page paper (PDF) [from the Global Development And Environment Institute at Tufts University] goes into the details [of projected economic gains from trade deals]. Along the way, it provides a highly critical analysis of the underlying econometric model used for almost all of the official studies of CETA, TPP and TTIP - the so-called "computable general equilibrium" (CGE) approach. In particular, the authors find that using the CGE model to analyze a potential trade deal effectively guarantees that there will be a positive outcome ("net welfare gains") because of its unrealistic assumptions" [ TechDirt ]. ..."
Sep 26, 2016 | www.nakedcapitalism.com

Bill Clinton: "The geopolitical reasons for [TPP], from America's point of view, are pretty clear. It's designed to make sure that the future of the Asia-Pacific region, economically, is not totally dominated by China" [ CNBC ].

"However, he stopped short [by about an inch, right?] of supporting the TPP. He added that his wife [who is running for President' has said provisions on currency manipulation must be enforced and measures put in place in the United States to address any labor market dislocations that result from trade deals." Oh. "Provisions enforced" sounds like executive authority, to me. And "measures put in place" sounds like a side deal. In other words, Bill Clinton just floated Hillary's trial balloon for passing TPP, if Obama can't get it done in the lame duck. Of course, if you parsed her words, you knew she wasn't lying , exactly .

" The full 40-page paper (PDF) [from the Global Development And Environment Institute at Tufts University] goes into the details [of projected economic gains from trade deals]. Along the way, it provides a highly critical analysis of the underlying econometric model used for almost all of the official studies of CETA, TPP and TTIP - the so-called "computable general equilibrium" (CGE) approach. In particular, the authors find that using the CGE model to analyze a potential trade deal effectively guarantees that there will be a positive outcome ("net welfare gains") because of its unrealistic assumptions" [ TechDirt ].

"Conservative lawmakers looking for a way to buck Donald Trump's populist message on trade may have gotten a little more cover with more than 30 conservative and libertarian groups sending a letter today to Congress expressing strong support for free trade" [ Politico ]. National Taxpayers Union, Club for Growth, FreedomWorks

"France is set to arrive at the meeting with a proposal to suspend TTIP negotiations, our Pro Trade colleagues in Brussels report. But for the deal's supporters, there's hop'e: 'France will not win the day,' Alberto Mucci, Christian Oliver and Hans von der Burchard write. 'Britain [???], Italy, Spain, Poland, the Nordic countries and the Baltics will thwart any attempt to end the Transatlantic Trade and Investment Partnership in Bratislava'" [ Politico ].

[Dec 05, 2016] Stiglitz Blasts Outrageous TPP as Obama Campaigns for Corporate-Friendly Deal Common Dreams Breaking News Views for the

Notable quotes:
"... Expressing his overall objections to the TPP, Stiglitz said "corporate interests... were at the table" when it was being crafted. He also condemned "the provisions on intellectual property that will drive up drug prices" and "the 'investment provisions' which will make it more difficult to regulate and actually harm trade." ..."
"... The Democratic candidate, for her part, supported the deal before coming out against it , but for TPP foes, uncertainty about her position remains, especially since she recently named former Colorado Senator and Interior Secretary-and " vehement advocate for the TPP "-Ken Salazar to be chair of her presidential transition team. ..."
"... Rep. Debbie Dingell (D-Mich.) said , "We have to make sure that bill never sees the light of day after this election," while Rep. Alan Grayson (D-Fla.) said at the American Postal Workers Union convention in Walt Disney World, "If this goes through, it's curtains for the middle class in this country." ..."
Aug 25, 2016 | www.commondreams.org
Nobel Prize-winning economist Joseph Stiglitz has reiterated his opposition to the Trans Pacific Partnership (TPP), saying on Tuesday that President Barack Obama's push to get the trade deal passed during the upcoming lame-duck session of Congress is "outrageous" and "absolutely wrong."

Stiglitz, an economics professor at Columbia University and chief economist of the Roosevelt Institute, made the comments on CNN's "Quest Means Business."

His criticism comes as Obama aggressively campaigns to get lawmakers to pass the TPP in the Nov. 9 to Jan. 3 window-even as resistance mounts against the 12-nation deal.

Echoing an argument made by Center for Economic and Policy Research co-director Mark Weisbrot, Stiglitz said, "At the lame-duck session you have congressmen voting who know that they're not accountable anymore."

Lawmakers "who are not politically accountable because they're leaving may, in response to promises of jobs or just subtle understandings, do things that are not in the national interest," he said.

Expressing his overall objections to the TPP, Stiglitz said "corporate interests... were at the table" when it was being crafted. He also condemned "the provisions on intellectual property that will drive up drug prices" and "the 'investment provisions' which will make it more difficult to regulate and actually harm trade."

"The advocates of trade said it was going to benefit everyone," he added. "The evidence is it's benefited a few and left a lot behind."

Stiglitz has previously spoken out against the TPP before, arguing that it "may turn out to be the worst trade agreement in decades;" that it would mean "if you pass a regulation that restricts ability to pollute or does something about climate change, you could be sued and could pay billions of dollars;" and previously said that the president's TPP push "is one of Obama's biggest mistakes."

Stiglitz has also been advising the Hillary Clinton presidential campaign. The Democratic candidate, for her part, supported the deal before coming out against it, but for TPP foes, uncertainty about her position remains, especially since she recently named former Colorado Senator and Interior Secretary-and "vehement advocate for the TPP"-Ken Salazar to be chair of her presidential transition team.

Opposition to the TPP also appeared Tuesday in Michigan and Florida, where union members and lawmakers criticized what they foresee as the deal's impacts on working families.

Rep. Debbie Dingell (D-Mich.) said, "We have to make sure that bill never sees the light of day after this election," while Rep. Alan Grayson (D-Fla.) said at the American Postal Workers Union convention in Walt Disney World, "If this goes through, it's curtains for the middle class in this country."

[Dec 05, 2016] Trans-Pacific Partnership (TPP) Tulsi Gabbard - Fighting for the people.

Aug 01, 2016 | www.votetulsi.com

We cannot allow this agreement to forsake the American middle class, while foreign governments are allowed to devalue their currency and artificially prop-up their industries.

The Trans-Pacific Partnership trade deal is a bad deal for the American people. This historically massive trade deal -- accounting for 40 percent of global trade -- would reduce restrictions on foreign corporations operating within the U.S., limit our ability to protect our environment, and create more incentives for U.S. businesses to outsource investments and jobs overseas to countries with lower labor costs and standards.

Over and over we hear from TPP proponents how the TPP will boost our economy, help American workers, and set the standards for global trade. The International Trade Commission report released last May (https://www.usitc.gov/publications/332/pub4607.pdf) confirms that the opposite is true. In exchange for just 0.15 percent boost in GDP by 2032, the TPP would decimate American manufacturing capacity, increase our trade deficit, ship American jobs overseas, and result in losses to 16 of the 25 U.S. economic sectors. These estimates don't even account for the damaging effects of currency manipulation, environmental impacts, and the agreement's deeply flawed Investor State Dispute Settlement (ISDS) process.

There's no reason to believe the provisions of this deal relating to labor standards, preserving American jobs, or protecting our environment, will be enforceable. Every trade agreement negotiated in the past claimed to have strong enforceable provisions to protect American jobs -- yet no such enforcement has occurred, and agreements like the North American Free Trade Agreement (NAFTA) have resulted in the loss of hundreds of thousands of American jobs. Former Secretary of Labor Robert Reich has called TPP "NAFTA on steroids." The loss of U.S. jobs under the TPP would likely be unprecedented.

https://www.youtube.com/watch?v=_fC0qppnK_U

Watch: Tulsi restates the need for transparency in the Trans-Pacific Partnership (TPP) on the House floor.

[Dec 05, 2016] BuzzFeed Exposes Corporate Super Courts That Can Overrule Government

Corporations are "one-dollar-one-vote" top-down systems. They consider "one-person-one-vote" democracy illegitimate
Notable quotes:
"... Existing "trade" agreements like NAFTA allow corporations to sue governments for passing laws and regulations that limit their profits. They set up special " corporate courts " in which corporate attorneys decide the cases. These corporate "super courts" sit above governments and their own court systems, and countries and their citizens cannot even appeal the rulings. ..."
"... Now, corporations are pushing two new "trade" agreements - one covering Pacific-are countries and one covering Atlantic-area countries - that expand these corporate rights and move governments out of their way. The Pacific agreement is called the Trans-Pacific Partnership (TPP) and the Atlantic one is called the Trans-Atlantic Trade and Investment Partnership (TTIP). ..."
"... International corporations that want to intimidate countries have access to a private legal system designed just for them. And to unlock its power, sometimes all it takes is a threat. ..."
"... ISDS is so tilted and unpredictable, and the fines the arbitrators can impose are so catastrophically large, that bowing to a company's demands, however extreme they may be, can look like the prudent choice. ..."
Sep 03, 2016 | Back to (our) Future

BuzzFeed is running a very important investigative series called "Secrets of a Global Super Court." It describes what they call "a parallel legal universe, open only to corporations and largely invisible to everyone else."

Existing "trade" agreements like NAFTA allow corporations to sue governments for passing laws and regulations that limit their profits. They set up special "corporate courts" in which corporate attorneys decide the cases. These corporate "super courts" sit above governments and their own court systems, and countries and their citizens cannot even appeal the rulings.

The 2014 post "Corporate Courts - A Big Red Flag On "Trade" Agreements" explained the origin and rationale for these corporate courts:

Picture a poor "banana republic" country ruled by a dictator and his cronies. A company might want to invest in a factory or railroad - things that would help the people of that country as well as deliver a return to the company. But the company worries that the dictator might decide to just seize the factory and give it to his brother-in-law. Agreements to protect investors, and allowing a tribunal not based in such countries (courts where the judges are cronies of the dictator), make sense in such situations.

Here's the thing: Corporate investors see themselves as legitimate "makers" and see citizens and voters and their governments - always demanding taxes and fair pay and public safety - to be illegitimate "takers." Corporations are all about "one-dollar-one-vote" top-down systems of governance. They consider "one-person-one-vote" democracy to be an illegitimate, non-functional system that meddles with their more-important profit interests. They consider any governmental legal or regulatory system to be "burdensome." They consider taxes as "theft" of the money they have "earned."

To them, any government anywhere is just another "banana republic" from which they need special protection.

"Trade" Deals Bypass Borders

Investors and their corporations have set up a way to get around the borders of these meddling governments, called "trade" deals. The trade deals elevate global corporate interests above any national interest. When a country signs a "trade" deal, that country is agreeing not to do things that protect the country's own national interest - like impose tariffs to protect key industries or national strategies, or pass laws and regulations - when those things interfere with the larger, more important global corporate "trade" interests.

Now, corporations are pushing two new "trade" agreements - one covering Pacific-are countries and one covering Atlantic-area countries - that expand these corporate rights and move governments out of their way. The Pacific agreement is called the Trans-Pacific Partnership (TPP) and the Atlantic one is called the Trans-Atlantic Trade and Investment Partnership (TTIP).

Secrets of a Global Super Court

BuzzFeed's series on these corporate courts, "Secrets of a Global Super Court," explains the investor-state dispute settlement (ISDS) provisions in the "trade" deals that have come to dominate the world economy. These provisions set up "corporate courts" that place corporate profits above the interests of governments and set up a court system that sits above the court systems of the countries in the "trade" deals.

Part One, "Inside The Global "Club" That Helps Executives Escape Their Crimes," describes, "A parallel legal universe, open only to corporations and largely invisible to everyone else, helps executives convicted of crimes escape punishment."

In a little-noticed 2014 dissent, US Chief Justice John Roberts warned that ISDS arbitration panels hold the alarming power to review a nation's laws and "effectively annul the authoritative acts of its legislature, executive, and judiciary." ISDS arbitrators, he continued, "can meet literally anywhere in the world" and "sit in judgment" on a nation's "sovereign acts."

[. . .]

Reviewing publicly available information for about 300 claims filed during the past five years, BuzzFeed News found more than 35 cases in which the company or executive seeking protection in ISDS was accused of criminal activity, including money laundering, embezzlement, stock manipulation, bribery, war profiteering, and fraud.

Among them: a bank in Cyprus that the US government accused of financing terrorism and organized crime, an oil company executive accused of embezzling millions from the impoverished African nation of Burundi, and the Russian oligarch known as "the Kremlin's banker."

One lawyer who regularly represents governments said he's seen evidence of corporate criminality that he "couldn't believe." Speaking on the condition that he not be named because he's currently handling ISDS cases, he said, "You have a lot of scuzzy sort-of thieves for whom this is a way to hit the jackpot."

Part Two, "The Billion-Dollar Ultimatum," looks at how "International corporations that want to intimidate countries have access to a private legal system designed just for them. And to unlock its power, sometimes all it takes is a threat."

Of all the ways in which ISDS is used, the most deeply hidden are the threats, uttered in private meetings or ominous letters, that invoke those courts. The threats are so powerful they often eliminate the need to actually bring a lawsuit. Just the knowledge that it could happen is enough.

[. . .] ISDS is so tilted and unpredictable, and the fines the arbitrators can impose are so catastrophically large, that bowing to a company's demands, however extreme they may be, can look like the prudent choice. Especially for nations struggling to emerge from corrupt dictatorships or to lift their people from decades of poverty, the mere threat of an ISDS claim triggers alarm. A single decision by a panel of three unaccountable, private lawyers, meeting in a conference room on some other continent, could gut national budgets and shake economies to the core.

Part Three, "To Bankers, It's Not Just A Court System, It's A Gold Mine," exposes how "Financial companies have figured out how to turn a controversial global legal system to their own very profitable advantage."

Indeed, financiers and ISDS lawyers have created a whole new business: prowling for ways to sue nations in ISDS and make their taxpayers fork over huge sums, sometimes in retribution for enforcing basic laws or regulations.

The financial industry is pushing novel ISDS claims that countries never could have anticipated - claims that, in some instances, would be barred in US courts and those of other developed nations, or that strike at emergency decisions nations make to cope with crises.

ISDS gives particular leverage to traders and speculators who chase outsize profits in the developing world. They can buy into local disputes that they have no connection to, then turn the disputes into costly international showdowns. Standard Chartered, for example, bought the debt of a Tanzanian company that was in dire financial straits and racked by scandal; now, the bank has filed an ISDS claim demanding that the nation's taxpayers hand over the full amount that the private company owed - more than $100 million. Asked to comment, Standard Chartered said its claim is "valid."

David Dayen explains this last point, in "The Big Problem With The Trans-Pacific Partnership's Super Court That We're Not Talking About": "Financiers will use it to bet on lawsuits, while taxpayers foot the bill."

But instead of helping companies resolve legitimate disputes over seized assets, ISDS has increasingly become a way for rich investors to make money by speculating on lawsuits, winning huge awards and forcing taxpayers to foot the bill.

Here's how it works: Wealthy financiers with idle cash have purchased companies that are well placed to bring an ISDS claim, seemingly for the sole purpose of using that claim to make a buck. Sometimes, they set up shell corporations to create the plaintiffs to bring ISDS cases. And some hedge funds and private equity firms bankroll ISDS cases as third parties - just like billionaire Peter Thiel bankrolled Hulk Hogan in his lawsuit against Gawker Media.

Part Four of the great BuzzFeed series, "Secrets of a Global Super Court," is expected to be published later this week.

PCCC Statement

The Progressive Change Campaign Committee (PCCC) released this statement on the ISDS provisions in TPP:

"Under the Trans-Pacific Partnership, Wall Street would be allowed to sue the government in extrajudicial, corporate-run tribunals over any regulation and American taxpayers would be on the hook for damages. This is an outrage. We need more accountability and fairness in our economy – not less. And we need to preserve our ability to make our own rules.

"It's time for Obama to take notice of the widespread, bipartisan opposition to the TPP and take this agreement off the table before he causes lasting political harm to Democrats with voters."

[Dec 05, 2016] No TPP - a certainty in case Donald Trump is elected in November - means the end of US economic hegemony over Asia.

Notable quotes:
"... "No TPP - a certainty in case Donald Trump is elected in November - means the end of US economic hegemony over Asia. Hillary Clinton knows it; and it's no accident President Obama is desperate to have TPP approved during a short window of opportunity, the lame-duck session of Congress from November 9 to January 3." ..."
"... To me, the key to our economic hegemony lies in our reserve currency hegemony. They will have to continue to supply us to get the currency. Unless we have injected too much already (no scholars have come forth to say how much trade deficits are necessary for the reserve currency to function as the reserve currency, and so, we have just kept buying – and I am wondering if we have bought too much and there is a need to starting running trade surpluses to soak up the excess money – just asking, I don't know the answer). ..."
Sep 01, 2016 | www.nakedcapitalism.com

Joe Hunter , August 31, 2016 at 2:52 pm

" http://www.defenddemocracy.press/whole-game-containing-russisa-china/

A response to Hillary Clinton's America Exceptionalist Speech:

1. America Exceptionalist vs. the World..
2. Brezinski is extremely dejected.
3. Russia-China on the march.
4. "There will be blood. Hillary Clinton smells it already ."

clarky90 , August 31, 2016 at 4:01 pm

"No TPP - a certainty in case Donald Trump is elected in November - means the end of US economic hegemony over Asia. Hillary Clinton knows it; and it's no accident President Obama is desperate to have TPP approved during a short window of opportunity, the lame-duck session of Congress from November 9 to January 3."

http://sputniknews.com/columnists/20160829/1044733257/russia-china-game-brics.html

MyLessThanPrimeBeef , August 31, 2016 at 4:18 pm

To me, the key to our economic hegemony lies in our reserve currency hegemony. They will have to continue to supply us to get the currency. Unless we have injected too much already (no scholars have come forth to say how much trade deficits are necessary for the reserve currency to function as the reserve currency, and so, we have just kept buying – and I am wondering if we have bought too much and there is a need to starting running trade surpluses to soak up the excess money – just asking, I don't know the answer).

[Dec 05, 2016] In the face of public opposition to the TPP and TISA proponents have trotted out a new argument: we have come too far , our national credibility would be damaged if we stop now.

Aug 27, 2016 | www.nakedcapitalism.com
L , August 26, 2016 at 2:44 pm

Regarding the push to pass the TPP and TISA I've been needing to get this off my chest and this seems to be as good a time as any:

In the face of public opposition to the TPP and TISA proponents have trotted out a new argument: "we have come too far", "our national credibility would be damaged if we stop now." The premise of which is that negotiations have been going on so long, and have involved such effort that if the U.S. were to back away now we would look bad and would lose significant political capital.

On one level this argument is true. The negotiations have been long, and many promises were made by the negotiators to secure to to this point. Stepping back now would expose those promises as false and would make that decade of effort a loss. It would also expose the politicians who pushed for it in the face of public oppoosition to further loss of status and to further opposition.

However, all of that is voided by one simple fact. The negotiations were secret. All of that effort, all of the horse trading and the promise making was done by a self-selected body of elites, for that same body, and was hidden behind a wall of secrecy stronger than that afforded to new weapons. The deals were hidden not just from the general public, not from trade unions or environmental groups, but from the U.S. Congress itself.

Therefore it has no public legitimacy. The promises made are not "our" promises but Michael Froman's promises. They are not backed by the full faith and credit of the U.S. government but only by the words of a small body of appointees and the multinational corporations that they serve. The corporations were invited to the table, Congress was not.

What "elites" really mean when they say "America's credibility is on the line" is that their credibility is on the line. If these deals fail what will be lost is not America's stature but the premise that a handful of appointees can cut deals in private and that the rest of us will make good.

When that minor loss is laid against the far greater fact that the terms of these deals are bad, that prior deals of this type have harmed our real economies, and that the rules will further erode our national sovreignity, there is no contest.

Michael Froman's reputation has no value. Our sovreignity, our economy, our nation, does.

flora , August 26, 2016 at 2:51 pm

+1

grizziz , August 26, 2016 at 2:52 pm

Thank you for your comment. +1

Lambert Strether Post author , August 26, 2016 at 2:57 pm

"We've gone too far."

Whaddaya mean, "we"?

ambrit , August 26, 2016 at 6:45 pm

The imperial "We."
I just had a soul corroding vision of H Clinton done up as Victoria Regina. Ouch!!! Go get the butter!

Jim Haygood , August 26, 2016 at 6:53 pm

In modern parlance, she's Victoria Rejayjay. :-0

JohnnyGL , August 26, 2016 at 3:01 pm

Good comment .

"What "elites" really mean when they say "America's credibility is on the line" is that their credibility is on the line. If these deals fail what will be lost is not America's stature but the premise that a handful of appointees can cut deals in private and that the rest of us will make good."

Yes! And the victory will taste so sweet when we bury this filthy, rotten, piece of garbage. Obama's years of effort down the drain, his legacy tarnished and unfinished.

I want TPP's defeat to send a clear message that the elites can't count on their politicians to deliver for them. Let's make this thing their Stalingrad! Leave deep scars so that they give up on TISA and stop trying to concoct these absurd schemes like ISDS.

abynormal , August 26, 2016 at 3:10 pm

sorry but i don't see it that way at all. 'they' got a propaganda machine to beat all 'they' make n break reps all the time. i do see a desperation on a monetary/profit scale. widening the 'playing field' offers more profits with less risk. for instance, our Pharams won't have to slash their prices at the risk of sunshine laws, wish-washy politicians, competition, nor a pissed off public. jmo tho')

OpenThePodBayDoorsHAL , August 26, 2016 at 4:13 pm

LOL "America's credibility" LOL, these people need to get out more. In the 60's you could hike high up into the Andes and the sheep herder had two pics on the wall of his hut: Jesus and JFK. America retains its cachet as a place to make money and be entertained, but as some kind of beacon of morality and fair play in the world? Dead, buried, and long gone, the hype-fest of slogans and taglines can only cover up so many massive, atrocious and hypocritical actions and serial offenses.

Synoia , August 26, 2016 at 4:57 pm

his legacy tarnished and unfinished.

And his post-presidential money small .

NotTimothyGeithner , August 26, 2016 at 6:11 pm

Clinton Inc was mostly Bill helping Epstein get laid until after Kerry lost. If this was the reelection of John Edwards, Kerry's running mate, and a referendum on 12 years of Kerronomics, Bill and Hill would be opening night speakers at the DNC and answers to trivia questions.

My guess is Obama is dropped swiftly and unceremoniously especially since he doesn't have much of a presence in Washington.

John Wright , August 26, 2016 at 6:15 pm

The must preserve American credibility argument on the line again.

Here is a quote from NYT's Nicholas Kristoff from http://www.nytimes.com/2013/08/29/opinion/kristof-reinforce-a-norm-in-syria.html

"It looks as if we'll be firing Tomahawk cruise missiles at Syria in the coming days, and critics are raising legitimate concerns:"

"Yet there is value in bolstering international norms against egregious behavior like genocide or the use of chemical weapons. Since President Obama established a "red line" about chemical weapons use, his credibility has been at stake: he can't just whimper and back down."

Obama did back down.

NIcholas Kristof, vigilant protector of American credibility through bombing Syria.

polecat , August 26, 2016 at 7:14 pm

he's just another syncophantic punk .in a long line of syncophantic punks

..oh..that includes Kristof too

RabidGandhi , August 26, 2016 at 3:48 pm

Ah yes the credibility of our élites. With their sterling record on Nafta's benefits, Iraq's liberation, Greece's rebound, the IMF's rehabilitation of countries

We must pass TPP or Tom Friedman will lose credibility, what?

polecat , August 26, 2016 at 7:17 pm

yeah but will he have to shave off his 'stache' ??

Propertius , August 26, 2016 at 3:53 pm

Well said!

HopeLB , August 26, 2016 at 8:36 pm

Wonderful (and credible) assessment.

[Dec 05, 2016] Framing Votes for TPP as the Surrender of National Sovereignty (i.e., Treason) naked capitalism

Notable quotes:
"... pro-TPPers "consciously seek to weaken the national defense," that's exactly what's going on. Neoliberalism, through offshoring, weakens the national defense, because it puts our weaponry at the mercy of fragile and corruptible supply chains. ..."
"... Now, when we think about how corrupt the political class has become, it's not hard to see why Obama is confident that he will win. ..."
"... I think raising the ante rhetorically by framing a pro-TPP vote as treason could help sway a close vote; and if readers try that frame out, I'd like to hear the results ..."
Aug 29, 2016 | www.nakedcapitalism.com
Why the Proponents of TPP Are Traitors

There are two reasons: First, they consciously seek to weaken the national defense. And second, the Investor-State Dispute Settlement (ISDS) system is a surrender of national sovereignty .

National Defense

This might be labeled the "Ghost Fleet" argument, since we're informed that Paul Singer and Augustus Cole's techno-thriller has really caught the attention of the national security class below the political appointee level, and that this is a death blow for neoliberalism. Why? "The multi-billion dollar, next generation F-35 aircraft, for instance, is rendered powerless after it is revealed that Chinese microprocessor manufacturers had implanted malicious code into products intended for the jet" ( Foreign Policy ). Clearly, we need, well, industrial policy, and we need to bring a lot of manufacturing home. From Brigadier General (Retired) John Adams :

In 2013, the Pentagon's Defense Science Board put forward a remarkable report describing one of the most significant but little-recognized threats to US security: deindustrialization. The report argued that the loss of domestic U.S. manufacturing facilities has not only reduced U.S. living standards but also compromised U.S. technology leadership "by enabling new players to learn a technology and then gain the capability to improve on it." The report explained that the offshoring of U.S. manufacturing presents a particularly dangerous threat to U.S. military readiness through the "compromise of the supply chain for key weapons systems components."

Our military is now shockingly vulnerable to major disruptions in the supply chain, including from substandard manufacturing practices, natural disasters, and price gouging by foreign nations. Poor manufacturing practices in offshore factories lead to problem-plagued products, and foreign producers-acting on the basis of their own military or economic interests-can sharply raise prices or reduce or stop sales to the United States.

The link between TPP and this kind of offshoring has been well-established.

And, one might say, the link between neo-liberal economic policy "and this kind of offshoring has been well-established" as well.

So, when I framed the issue as one where pro-TPPers "consciously seek to weaken the national defense," that's exactly what's going on. Neoliberalism, through offshoring, weakens the national defense, because it puts our weaponry at the mercy of fragile and corruptible supply chains. Note that re-industrializing America has positive appeal, too: For the right, on national security grounds; and for the left, on labor's behalf (and maybe helping out the Rust Belt that neoliberal policies of the last forty years did so much to destroy. Of course, this framing would make Clinton a traitor, but you can't make an omelette without breaking eggs. (Probably best to to let the right, in its refreshingly direct fashion, use the actual "traitor" word, and the left, shocked, call for the restoration of civility, using verbiage like "No, I wouldn't say she's a traitor. She's certainly 'extremely careless' with our nation's security.")

ISDS

The Investor-State Dispute Settlement system is a hot mess (unless you represent a corporation, or are one of tiny fraternity of international corporate lawyers who can plead and/or judge ISDS cases). Yves wrote :

What may have torched the latest Administration salvo is a well-timed joint publication by Wikileaks and the New York Times of a recent version of the so-called investment chapter. That section sets forth one of the worst features of the agreement, the investor-state dispute settlement process (ISDS). As we've described at length in earlier posts, the ISDS mechanism strengthens the existing ISDS process. It allows for secret arbitration panels to effectively overrule national regulations by allowing foreign investors to sue governments over lost potential future profits in secret arbitration panels. Those panels have been proved to be conflict-ridden and arbitrary. And the grounds for appeal are limited and technical.

(More from NC on the ISDS panels , the TPP clauses on ISDS , the "code of conduct" for lawyers before the ISDS, pending ISDS settlements , and the potential constitutional challenges to the ISDS system.)

Here again we have a frame that appeals to both right and left. The very thought of surrendering national sovereignty to an international organization makes any good conservative's back teeth itch. And the left sees the "lost profits" doctrine as a club to prevent future government programs they would like to put in place (single payer, for example). And in both cases, the neoliberal doctrine of putting markets before anything else makes pro-TPP-ers traitors. To the right, because nationalism trumps internationalism; to the left, because TPP prevents the State from looiking after the welfare of its people.

The Political State of Play

All I know is what I read in the papers, so what follows can only be speculation. That said, there are two ways TPP could be passed: In the lame duck session, by Obama, or after a new President is inaugurated, by Clinton (or possibly by Trump[1]).

Passing TPP in the Lame Duck Session

Obama is committed to passing TPP (and we might remember that the adminstration failed to pass the draft in Maui , then succeeded in Atlanta . And the House killed Fast Track once , before voting for it (after which the Senate easily passed it, and Obama signed it). So the TPP may be a "heavy lift," but that doesn't mean Obama can't accomplish it. Obama says :

[OBAMA:] And hopefully, after the election is over and the dust settles, there will be more attention to the actual facts behind the deal and it won't just be a political symbol or a political football. And I will actually sit down with people on both sides, on the right and on the left. I'll sit down publicly with them and we'll go through the whole provisions. I would enjoy that, because there's a lot of misinformation.

I'm really confident I can make the case this is good for American workers and the American people. And people said we weren't going to be able to get the trade authority to even present this before Congress, and somehow we muddled through and got it done. And I intend to do the same with respect to the actual agreement.

So how would Obama "muddle through"? One way is to appeal to legislators who won't have to face voters again :

So it is looking like a very close vote. (For procedural and political reasons, Obama will not bring it to a vote unless he is sure he has the necessary votes). Now let's look at one special group of Representatives who can swing this vote: the actual lame-ducks, i.e., those who will be in office only until Jan. 3. It depends partly on how many lose their election on Nov. 8, but the average number of representatives who left after the last three elections was about 80.

Most of these people will be looking for a job, preferably one that can pay them more than $1 million a year. From the data provided by OpenSecrets.org, we can estimate that about a quarter of these people will become lobbyists. (An additional number will work for firms that are clients of lobbyists).

So there you have it: It is all about corruption, and this is about as unadulterated as corruption gets in our hallowed democracy, other than literal cash under a literal table. These are the people whom Obama needs to pass this agreement, and the window between Nov. 9 and Jan. 3 is the only time that they are available to sell their votes to future employers without any personal political consequences whatsoever. The only time that the electorate can be rendered so completely irrelevant, if Obama can pull this off.

(The article doesn't talk about the Senate, but Fast Track passed the Senate with a filibuster-proof super-majority, so the battle is in the House anyhow. And although the text of TPP cannot be amended - that's what fast track means! - there are still ways to affect the interpretation and enforcement of the text, so Obama and his corporate allies have bargaining chips beyond Beltway sinecures.[2])

Now, when we think about how corrupt the political class has become, it's not hard to see why Obama is confident that he will win. ( Remember , "[T]he preferences of economic elites have far more independent impact upon policy change than the preferences of average citizens do.") However, if the anti-TPP-ers raise the rhetorical stakes from policy disagreement to treason, maybe a few of those 80 representatives will do the right thing (or, if you prefer, decide that the reputational damage to their future career makes a pro-TPP vote not worth it. Who wants to play golf with a traitor?)

Passing TPP after the Inaugural

After the coronation inaugural, Clinton will have to use more complicated tactics than dangling goodies before the snouts of representatives leaving for K Street. (We've seen that Clinton's putative opposition to TPP is based on lawyerly parsing; and her base supports it. So I assume a Clinton administration would go full speed ahead with it.) My own thought has been that she'd set up a "conversation" on trade, and then buy off the national unions with "jobs for the boys," so that they sell their locals down the river. Conservative Jennifer Rubin has a better proposal , which meets Clinton's supposed criterion of not hurting workers even better:

Depending on the election results and how many pro-free-trade Republicans lose, it still might not be sufficient. Here's a further suggestion: Couple it with a substantial infrastructure project that Clinton wants, but with substantial safeguards to make sure that the money is wisely spent. Clinton gets a big jobs bill - popular with both sides - and a revised TPP gets through.

Finally, an even more radical proposal, again from a conservative source :

What Clinton needs is a significant revision to TPP that she can tout as a real reform to trade agreements, one that satisfies some of the TPP's critics on the left. A minor tweak is unlikely to assuage anyone; this change needs to be a major one. Fortunately, there is a TPP provision that fits the bill perfectly: investor state dispute settlement (ISDS), the procedure that allows foreign investors to sue governments in an international tribunal. Removing ISDS could triangulate the TPP debate, allowing for enough support to get it through Congress.

Obama can't have a conversation on trade, or propose a jobs program, let alone jettison ISDS; all he's got going for him is corruption.[3] So, interestingly, although Clinton can't take the simple road of bribing the 80 represenatives, she does have more to bargain with on policy. Rubin's jobs bill could at least be framed as a riposte to the "Ghost Fleet" argument, since both are about "jawbs," even if infrastructure programs and reindustrialization aren't identical in intent. And while I don't think Clinton would allow ISDS to be removed ( her corporate donors love it ), at least somebody's thinking about how to pander to the left. Nevertheless, what does a jobs program matter if the new jobs leave the country anyhow? And suppose ISDS is removed, but the removal of the precautionary principle remains? We'd still get corporate-friendly decisions, bilaterally. And people would end up balancing the inevitable Clinton complexity and mush against the simplicity of the message that a vote for TPP is a vote against the United States.

Conclusion

I hope I've persuaded you that TPP is still very much alive, and that both Obama in the lame duck, and Clinton (or even Trump) when inaugurated have reasonable hopes of passing it. However, I think raising the ante rhetorically by framing a pro-TPP vote as treason could help sway a close vote; and if readers try that frame out, I'd like to hear the results (especially when the result comes from a letter to your Congress critter). Interestingly, Buzzfeed just published tonight the first in a four-part series, devoted to the idea that ISDS is what we have said it is all along: A surrender of national sovereignty. Here's a great slab of it :

Imagine a private, global super court that empowers corporations to bend countries to their will.

Say a nation tries to prosecute a corrupt CEO or ban dangerous pollution. Imagine that a company could turn to this super court and sue the whole country for daring to interfere with its profits, demanding hundreds of millions or even billions of dollars as retribution.

Imagine that this court is so powerful that nations often must heed its rulings as if they came from their own supreme courts, with no meaningful way to appeal. That it operates unconstrained by precedent or any significant public oversight, often keeping its proceedings and sometimes even its decisions secret. That the people who decide its cases are largely elite Western corporate attorneys who have a vested interest in expanding the court's authority because they profit from it directly, arguing cases one day and then sitting in judgment another. That some of them half-jokingly refer to themselves as "The Club" or "The Mafia."

And imagine that the penalties this court has imposed have been so crushing - and its decisions so unpredictable - that some nations dare not risk a trial, responding to the mere threat of a lawsuit by offering vast concessions, such as rolling back their own laws or even wiping away the punishments of convicted criminals.

This system is already in place, operating behind closed doors in office buildings and conference rooms in cities around the world. Known as investor-state dispute settlement, or ISDS, it is written into a vast network of treaties that govern international trade and investment, including NAFTA and the Trans-Pacific Partnership, which Congress must soon decide whether to ratify.

That's the stuff to give the troops!

NOTE

[1] Trump: "I pledge to never sign any trade agreement that hurts our workers." Lotta wiggle room there, and the lawyerly parsing is just like Clinton's. I don't think it's useful to discuss what Trump might do on TPP, because until there are other parties to the deal, there's no deal to be had. Right now, we're just looking at Trump doing A-B testing - not that there's anything wrong with that - which the press confuses with policy proposals. So I'm not considering Trump because I don't think we have any data to go on.

[2] In-Depth News explains the mechanisms:

To pacify [those to whom he will corrupt appeal], Obama will have to convince them that what they want will anyway be achieved, even if these are not legally part of the TPP because the TPP text cannot be amended.

He can try to achieve this through bilateral side agreements on specific issues. Or he can insist that some countries take on extra obligations beyond what is required by the TPP as a condition for obtaining a U.S. certification that they have fulfilled their TPP obligations.

This certification is required for the U.S. to provide the TPP's benefits to its partners, and the U.S. has previously made use of this process to get countries to take on additional obligations, which can then be shown to Congress members that their objectives have been met.

In other words, side deals.

[3] This should not be taken to imply that Clinton does not have corruption going for her, too. She can also make all the side deals Obama can.

[Dec 05, 2016] US Faces Major Setback As Europeans Revolt Against TTIP

Notable quotes:
"... One of the main concerns with TTIP is that it could allow multinational corporations to effectively "sue" governments for taking actions that might damage their businesses. Critics claim American companies might be able to avoid having to meet various EU health, safety and environment regulations by challenging them in a quasi-court set up to resolve disputes between investors and states. ..."
"... These developments take place against the background of another major free trade agreement - the Trans Pacific Partnership ( TPP ) - hitting snags on the way to being pushed through Congress. ..."
"... "US Faces Major Setback" Well, actually, US corporations face a major setback. Average US citizens face a reprieve. ..."
Zero Hedge
TTIP negotiations have been ongoing since 2013 in an effort to establish a massive free trade zone that would eliminate many tariffs. After 14 rounds of talks that have lasted three years not a single common item out of the 27 chapters being discussed has been agreed on. The United States has refused to agree on an equal playing field between European and American companies in the sphere of public procurement sticking to the principle of "buy American".

The opponents of the deal believe that in its current guise the TTIP is too friendly to US businesses. One of the main concerns with TTIP is that it could allow multinational corporations to effectively "sue" governments for taking actions that might damage their businesses. Critics claim American companies might be able to avoid having to meet various EU health, safety and environment regulations by challenging them in a quasi-court set up to resolve disputes between investors and states.

In Europe thousands of people supported by society groups, trade unions and activists take to the streets expressing protest against the deal. Three million people have signed a petition calling for it to be scrapped. For instance, various trade unions and other groups have called for protests against the TTIP across Germany to take place on September 17. A trade agreement with Canada has also come under attack.

US presidential candidate Donald Trump has promoted protectionist trade policies, while rival Hillary Clinton has also cast doubt on the TTIP deal. Congressional opposition has become steep. The lawmakers on both sides of the aisle have railed against free trade agreements as unfair to US companies and workers.

These developments take place against the background of another major free trade agreement - the Trans Pacific Partnership (TPP) - hitting snags on the way to being pushed through Congress. The chances are really slim.

silverer •Sep 5, 2016 9:51 AM

"US Faces Major Setback" Well, actually, US corporations face a major setback. Average US citizens face a reprieve.

[Dec 05, 2016] Trump campaign is a similar to Brexit crusade by grassroots activists against big banks and global political insiders . by those who feel disaffected and disenfranchised

Notable quotes:
"... Speaking to a local radio station before the joint rally, Farage urged Americans to "go out and fight" against Hillary Clinton. ..."
"... "I am going to say to people in this country that the circumstances, the similarities, the parallels between the people who voted Brexit and the people who could beat Clinton in a few weeks time here in America are uncanny," Farage told Super Talk Mississippi. "If they want things to change they have get up out of their chairs and go out and fight for it. It can happen. We've just proved it." ..."
"... It's not for me as a foreign politician to say who you should vote for ... All I will say is that if you vote for Hillary Clinton, then nothing will change. She represents the very politics that we've just broken through the Brexit vote in the United Kingdom. ..."
Aug 24, 2016 | www.theguardian.com

...the British politician, who was invited by Mississippi governor Phil Bryant, will draw parallels between what he sees as the inspirational story of Brexit and Trump's campaign. Farage will describe the Republican's campaign as a similar crusade by grassroots activists against "big banks and global political insiders" and how those who feel disaffected and disenfranchised can become involved in populist, rightwing politics. With Trump lagging in the polls, just as Brexit did prior to the vote on the referendum, Farage will also hearten supporters by insisting that they can prove pundits and oddsmakers wrong as well.

This message resonates with the Trump campaign's efforts to reach out to blue collar voters who have become disillusioned with American politics, while also adding a unique flair to Trump's never staid campaign rallies.

The event will mark the first meeting between Farage and Trump.

Arron Banks, the businessman who backed Leave.EU, the Brexit campaign group associated with the UK Independence party (Ukip), tweeted that he would be meeting Trump over dinner and was looking forward to Farage's speech.

The appointment last week of Stephen Bannon, former chairman of the Breitbart website, as "CEO" of Trump's campaign has seen the example of the Brexit vote, which Breitbart enthusiastically advocated, rise to the fore in Trump's campaign narrative.

Speaking to a local radio station before the joint rally, Farage urged Americans to "go out and fight" against Hillary Clinton.

"I am going to say to people in this country that the circumstances, the similarities, the parallels between the people who voted Brexit and the people who could beat Clinton in a few weeks time here in America are uncanny," Farage told Super Talk Mississippi. "If they want things to change they have get up out of their chairs and go out and fight for it. It can happen. We've just proved it."

"I am being careful," he added when asked if he supported the controversial Republican nominee. "It's not for me as a foreign politician to say who you should vote for ... All I will say is that if you vote for Hillary Clinton, then nothing will change. She represents the very politics that we've just broken through the Brexit vote in the United Kingdom."

[Dec 05, 2016] Failure of Globalization and the Fourth Estate

Notable quotes:
"... As Mr. Buffet so keenly said it, There is a war going on, and we are winning. ..."
"... Just type `TPP editorial' into news.google.com and watch a toxic sludge of straw men, misdirection, and historical revisionism flow across your screen. And the `objective' straight news reporting is no better. ..."
"... "Why is it afraid of us?" Because we the people are perceived to be the enemy of America the Corporation. Whistleblowers have already stated that the NSA info is used to blackmail politicians and military leaders, provide corporate espionage to the highest payers and more devious machinations than the mind can grasp from behind a single computer. 9/11 was a coup – I say that because looking around the results tell me that. ..."
"... The fourth estate (the media) has been purchased outright by the second estate (the nobility). I guess you could call this an 'estate sale'. All power to the markets! ..."
naked capitalism
Free Trade," the banner of Globalization, has not only wrecked the world's economy, it has left Western Democracy in shambles. Europe edges ever closer to deflation. The Fed dare not increase interest rates, now poised at barely above zero. As China's stock market threatened collapse, China poured billions to prop it up. It's export machine is collapsing. Not once, but twice, it recently manipulated its currency to makes its goods cheaper on the world market. What is happening?

The following two graphs tell most of the story. First, an overview of Free Trade.

Deficit4-1024x420

Capital fled from developed countries to undeveloped countries with slave-cheap labor, countries with no environmental standards, countries with no support for collective bargaining. Corporations, like Apple, set up shop in China and other undeveloped countries. Some, like China, manipulated its currency to make exported goods to the West even cheaper. Some, like China, gave preferential tax treatment to Western firm over indigenous firms. Economists cheered as corporate efficiency unsurprisingly rose. U.S. citizens became mere consumers.

Thanks to Bill Clinton and the Financial Modernization Act, banks, now unconstrained, could peddle rigged financial services, offer insurance on its own investment products–in short, banks were free to play with everyone's money–and simply too big to fail. Credit was easy and breezy. If nasty Arabs bombed the Trade Center, why the solution was simple: Go to the shopping mall–and buy. That remarkable piece of advice is just what freedom has been all about.

Next: China's export machine sputters.

CAIXEN-1024x527

China's problem is that there are not enough orders to keep the export machine going. There comes a time when industrialized nations simply run out of cash–I mean the little people run out of cash. CEOs and those just below them–along with slick Wall Street gauchos–made bundles on Free Trade, corporate capital that could set up shop in any impoverished nation in the world.. No worries about labor–dirt cheap–or environmental regulations–just bring your gas masks. At some point the Western consumer well was bound to run dry. Credit was exhausted; the little guy could not buy anymore. Free trade was on its last legs.

So what did China do then? As its markets crashed, it tried to revive its export model, a model based on foreign firms exporting cheap goods to the West. China lowered its exchange rates, not once but twice. Then China tried to rescue the markets with cash infusion of billions. Still its market continued to crash. Manufacturing plants had closed–thousands of them. Free Trade and Globalization had run its course.

And what has the Fed been doing? Why quantitative easy–increase the money supply and lower short term interest rates. Like China's latest currency manipulation, both were merely stop-gap measures. No one, least of all Obama and his corporate advisors, was ready to address corporate outsourcing that has cost millions of jobs. Prime the pump a little, but never address the real problem.

The WTO sets the groundwork for trade among its member states. That groundwork is deeply flawed. Trade between impoverished third world countries and sophisticated first world economies is not merely a matter of regulating "dumping"-not allowing one country to flood the market with cheap goods-nor is it a matter of insuring that the each country does not favor its indigenous firms over foreign firms. Comparable labor and environmental standards are necessary. Does anyone think that a first world worker can compete with virtual slave labor? Does anyone think that a first world nation with excellent environmental regulations can compete with a third world nation that refuses to protect its environment?

Only lately has Apple even mentioned that it might clean up its mess in China. The Apple miracle has been on the backs of the Chinese poor and abysmal environmental wreckage that is China.

The WTO allows three forms of inequities-all of which encourage outsourcing: labor arbitrage, tax arbitrage, and environmental arbitrage. For a fuller explanation of these inequities and the "race to the bottom," see here.

Of course now we have the mother of all Free Trade deals –the Trans-Pacific Partnership (TPP)– carefully wrapped in a black box so that none of us can see what finally is in store for us. Nothing is ever "Free"–even trade. I suspect that China is becoming a bit too noxious and poisonous. It simply has to deal with its massive environmental problems. Time to move the game to less despoiled and maybe more impoverished countries. Meanwhile, newscasters are always careful to tout TPP.

Fast Tracking is a con man's game. Do it so fast that the marks never have a chance to watch their wallets. In hiding negotiations from prying, public eyes, Obama, has given the con men a bigger edge: A screen to hide the corporations making deals. Their interest is in profits, not in public good.

Consider the media. Our only defense is a strong independent media. At one time, newsrooms were not required to be profitable. Reporting the news was considered a community service. Corporate ownership provided the necessary funding for its newsrooms–and did not interfere.

But the 70′s and 80′s corporate ownership required its newsrooms to be profitable. Slowly but surely, newsrooms focused on personality, entertainment, and wedge issues–always careful not to rock the corporate boat, always careful not to tread on governmental policy. Whoever thought that one major news service–Fox–would become a breeding ground for one particular party.

But consider CNN: It organizes endless GOP debates; then spends hours dissecting them. Create the news; then sell it–and be sure to spin it in the direction you want.

Are matters of substance ever discussed? When has a serious foreign policy debate ever been allowed occurred–without editorial interference from the media itself. When has trade and outsourcing been seriously discussed–other than by peripheral news media?

Meanwhile, news media becomes more and more centralized. Murdoch now owns National Geographic!

Now, thanks to Bush and Obama, we have the chilling effect of the NSA. Just whom does the NSA serve when it collects all of our digital information? Is it being used to ferret out the plans of those exercising their right of dissent? Is it being used to increase the profits of favored corporations? Why does it need all of your and my personal information–from bank accounts, to credit cards, to travel plans, to friends with whom we chat .Why is it afraid of us?


jefemt, October 23, 2015 at 9:43 am

As Mr. Buffet so keenly said it, There is a war going on, and we are winning.

If 'they' are failing, I'd hate to see success!

Isn't it the un-collective WE who are failing?

failing to organize,
failing to come up with plausible, 90 degrees off present Lemming-to-Brink path alternative plans and policies,
failing to agree on any of many plausible alternatives that might work

Divided- for now- hopefully not conquered ..

I gotta scoot and get back to Dancing with the Master Chefs

allan, October 23, 2015 at 10:03 am

Just type `TPP editorial' into news.google.com and watch a toxic sludge of straw men, misdirection, and historical revisionism flow across your screen. And the `objective' straight news reporting is no better.

Vatch, October 23, 2015 at 10:36 am

Don't just watch the toxic sludge; respond to it with a letter to the editor (LTE) of the offending publication! For some of those toxic editorials, and contact information for LTEs, see:

http://www.nakedcapitalism.com/2015/10/200pm-water-cooler-10162015.html#comment-2503316

http://www.nakedcapitalism.com/2015/10/trading-away-land-rights-tpp-investment-agreements-and-the-governance-of-land.html#comment-2502833

A few of the editorials may now be obscured by paywalls or registration requirements, but most should still be visible. Let them know that we see through their nonsense!

TedWa, October 23, 2015 at 10:38 am

"Why is it afraid of us?" Because we the people are perceived to be the enemy of America the Corporation. Whistleblowers have already stated that the NSA info is used to blackmail politicians and military leaders, provide corporate espionage to the highest payers and more devious machinations than the mind can grasp from behind a single computer. 9/11 was a coup – I say that because looking around the results tell me that.

TG, October 23, 2015 at 3:27 pm

The fourth estate (the media) has been purchased outright by the second estate (the nobility). I guess you could call this an 'estate sale'. All power to the markets!

Pelham, October 23, 2015 at 8:32 pm

Even when newsrooms were more independent they probably would not, in general, have reported on free trade with any degree of skepticism. The recent disappearance of the old firewall between the news and corporate sides has made things worse, but at least since the "professionalization" of newsrooms that began to really take hold in the '60s, journalists have tended to identify far more with their sources in power than with their readers.

There have, of course, been notable exceptions. But even these sometimes serve more to obscure the real day-to-day nature of journalism's fealty to the corporate world than to bring about any significant change.

[Dec 05, 2016] The Great Ponzi Scheme of the Global Economy

www.counterpunch.org
March 25, 2016

CHRIS HEDGES: We're going to be discussing a great Ponzi scheme that not only defines not only the U.S. but the global economy, how we got there and where we're going. And with me to discuss this issue is the economist Michael Hudson, author of Killing the Host: How Financial Parasites and Debt Destroy the Global Economy. A professor of economics who worked for many years on Wall Street, where you don't succeed if you don't grasp Marx's dictum that capitalism is about exploitation. And he is also, I should mention, the godson of Leon Trotsky.

I want to open this discussion by reading a passage from your book, which I admire very much, which I think gets to the core of what you discuss. You write,

"Adam Smith long ago remarked that profits often are highest in nations going fastest to ruin. There are many ways to create economic suicide on a national level. The major way through history has been through indebting the economy. Debt always expands to reach a point where it cannot be paid by a large swathe of the economy. This is the point where austerity is imposed and ownership of wealth polarizes between the One Percent and the 99 Percent. Today is not the first time this has occurred in history. But it is the first time that running into debt has occurred deliberately." Applauded. "As if most debtors can get rich by borrowing, not reduced to a condition of debt peonage."

So let's start with the classical economists, who certainly understood this. They were reacting of course to feudalism. And what happened to the study of economics so that it became gamed by ideologues?

HUDSON: The essence of classical economics was to reform industrial capitalism, to streamline it, and to free the European economies from the legacy of feudalism. The legacy of feudalism was landlords extracting land-rent, and living as a class that took income without producing anything. Also, banks that were not funding industry. The leading industrialists from James Watt, with his steam engine, to the railroads

HEDGES: From your book you make the point that banks almost never funded industry.

HUDSON: That's the point: They never have. By the time you got to Marx later in the 19th century, you had a discussion, largely in Germany, over how to make banks do something they did not do under feudalism. Right now we're having the economic surplus being drained not by the landlords but also by banks and bondholders.

Adam Smith was very much against colonialism because that lead to wars, and wars led to public debt. He said the solution to prevent this financial class of bondholders burdening the economy by imposing more and more taxes on consumer goods every time they went to war was to finance wars on a pay-as-you-go basis. Instead of borrowing, you'd tax the people. Then, he thought, if everybody felt the burden of war in the form of paying taxes, they'd be against it. Well, it took all of the 19th century to fight for democracy and to extend the vote so that instead of landlords controlling Parliament and its law-making and tax system through the House of Lords, you'd extend the vote to labor, to women and everybody. The theory was that society as a whole would vote in its self-interest. It would vote for the 99 Percent, not for the One Percent.

By the time Marx wrote in the 1870s, he could see what was happening in Germany. German banks were trying to make money in conjunction with the government, by lending to heavy industry, largely to the military-industrial complex.

HEDGES: This was Bismarck's kind of social – I don't know what we'd call it. It was a form of capitalist socialism

HUDSON: They called it State Capitalism. There was a long discussion by Engels, saying, wait a minute. We're for Socialism. State Capitalism isn't what we mean by socialism. There are two kinds of state-oriented–.

HEDGES: I'm going to interject that there was a kind of brilliance behind Bismarck's policy because he created state pensions, he provided health benefits, and he directed banking toward industry, toward the industrialization of Germany which, as you point out, was very different in Britain and the United States.

HUDSON: German banking was so successful that by the time World War I broke out, there were discussions in English economic journals worrying that Germany and the Axis powers were going to win because their banks were more suited to fund industry. Without industry you can't have really a military. But British banks only lent for foreign trade and for speculation. Their stock market was a hit-and-run operation. They wanted quick in-and-out profits, while German banks didn't insist that their clients pay as much in dividends. German banks owned stocks as well as bonds, and there was much more of a mutual partnership.

That's what most of the 19th century imagined was going to happen – that the world was on the way to socializing banking. And toward moving capitalism beyond the feudal level, getting rid of the landlord class, getting rid of the rent, getting rid of interest. It was going to be labor and capital, profits and wages, with profits being reinvested in more capital. You'd have an expansion of technology. By the early twentieth century most futurists imagined that we'd be living in a leisure economy by now.

HEDGES: Including Karl Marx.

HUDSON: That's right. A ten-hour workweek. To Marx, socialism was to be an outgrowth of the reformed state of capitalism, as seemed likely at the time – if labor organized in its self-interest.

HEDGES: Isn't what happened in large part because of the defeat of Germany in World War I? But also, because we took the understanding of economists like Adam Smith and maybe Keynes. I don't know who you would blame for this, whether Ricardo or others, but we created a fictitious economic theory to praise a rentier or rent-derived, interest-derived capitalism that countered productive forces within the economy. Perhaps you can address that.

HUDSON: Here's what happened. Marx traumatized classical economics by taking the concepts of Adam Smith and John Stuart Mill and others, and pushing them to their logical conclusion. 2KillingTheHost_Cover_ruleProgressive capitalist advocates – Ricardian socialists such as John Stuart Mill – wanted to tax away the land or nationalize it. Marx wanted governments to take over heavy industry and build infrastructure to provide low-cost and ultimately free basic services. This was traumatizing the landlord class and the One Percent. And they fought back. They wanted to make everything part of "the market," which functioned on credit supplied by them and paid rent to them.

None of the classical economists imagined how the feudal interests – these great vested interests that had all the land and money – actually would fight back and succeed. They thought that the future was going to belong to capital and labor. But by the late 19th century, certainly in America, people like John Bates Clark came out with a completely different theory, rejecting the classical economics of Adam Smith, the Physiocrats and John Stuart Mill.

HEDGES: Physiocrats are, you've tried to explain, the enlightened French economists.

HUDSON: The common denominator among all these classical economists was the distinction between earned income and unearned income. Unearned income was rent and interest. Earned incomes were wages and profits. But John Bates Clark came and said that there's no such thing as unearned income. He said that the landlord actually earns his rent by taking the effort to provide a house and land to renters, while banks provide credit to earn their interest. Every kind of income is thus "earned," and everybody earns their income. So everybody who accumulates wealth, by definition, according to his formulas, get rich by adding to what is now called Gross Domestic Product (GDP).

HEDGES: One of the points you make in Killing the Host which I liked was that in almost all cases, those who had the capacity to make money parasitically off interest and rent had either – if you go back to the origins – looted and seized the land by force, or inherited it.

HUDSON: That's correct. In other words, their income is unearned. The result of this anti-classical revolution you had just before World War I was that today, almost all the economic growth in the last decade has gone to the One Percent. It's gone to Wall Street, to real estate

HEDGES: But you blame this on what you call Junk Economics.

HUDSON: Junk Economics is the anti-classical reaction.

HEDGES: Explain a little bit how, in essence, it's a fictitious form of measuring the economy.

HUDSON: Well, some time ago I went to a bank, a block away from here – a Chase Manhattan bank – and I took out money from the teller. As I turned around and took a few steps, there were two pickpockets. One pushed me over and the other grabbed the money and ran out. The guard stood there and saw it. So I asked for the money back. I said, look, I was robbed in your bank, right inside. And they said, "Well, we don't arm our guards because if they shot someone, the thief could sue us and we don't want that." They gave me an equivalent amount of money back.

Well, imagine if you count all this crime, all the money that's taken, as an addition to GDP. Because now the crook has provided the service of not stabbing me. Or suppose somebody's held up at an ATM machine and the robber says, "Your money or your life." You say, "Okay, here's my money." The crook has given you the choice of your life. In a way that's how the Gross National Product accounts are put up. It's not so different from how Wall Street extracts money from the economy. Then also you have landlords extracting

HEDGES: Let's go back. They're extracting money from the economy by debt peonage. By raising

HUDSON: By not playing a productive role, basically.

HEDGES: Right. So it's credit