STOP HUMORING THE PLUTOCRACY.

 

A RECAP OF THE NATURE OF THE CRISIS, AND WHY THE INSUFFICIENCY OF THE ANSWER SO FAR.

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Abstract: The present crisis in the USA was a long time coming. Viewed from a historical perspective, it is a typical power grab by a plutocracy, now encountering low key but determined resistance from the People. Viewed that way, it’s a good thing. We put it all in perspective, and comment on how to get out of it: stimulate, nationalize the banks so that they can be put back to work right away, and put the plutocracy back in its cage. Jared Diamond suggests to make the rich and the politicians “suffer even more”. We elucidate Treasury Secretary Geithner’s pathetic performance as the latest trick of the plutocracy and its servants to hold onto their ill deserved power and gains. Obama’s attempt to change the world for the better is confronted to an Evil so great that it baffles understanding. Apparently hyperbolic, but we explain.
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PLUTOCRACY ON THE ROPES, CONFUSION, PROCRASTINATION:
Technical semantic note, introduction, and overview: Many people, such as Jared Diamond do not (yet) use the word and concept of “plutocracy”, they use instead dozens of words and concepts that the word “plutocracy” contains all in a neat ten letters. Others, such as Bill Moyers of PBS, meekly prefer the word “oligarchy”. Olig-archy means literally in Greek “few-rule”, the rule of the few, of a small elite. Sure, but there is more. Studies of all sorts of primate societies show that rule tends to be inherited (often through conniving, influence yielding females). In complex human societies, the first vehicle of inheritance of rule and power is wealth, and it is best managed by the Dark Side. Both concepts are nicely semantically fusioned in the God of the underground, Pluto (underground is where wealth is, and eternal fire, hell too). This is serious business: for the 200th anniversary of the birth of Charles Darwin, the ideas of his more formidable predecessor, Lamarck, are being reinstated with a vengeance. It is clear now that the behavior one is submitted to as a child, or simply as a descendant of one’s ancestors, activate the master and slave mentalities. It’s not just among baboons that the descendants of slaves become slaves themselves. It is not only among rats that the descendants of the stressed are stressed. It is true for entire human nations, races, civilizations.  

It is with pleasure that I extensively quote below Jared Diamond, the famous anthropologist. Diamond has neatly come to my point of view that plutocracy is the cause of societal collapse.

Obama passed a sort of stimulus (but not as big as it looks because it contains the AMT reduction, which is always there, and it contains some replenishment for the local states budgets, that are collapsing). That stimulus was OK, but a lot of the tax cuts are useless, they just sap at necessary State initiated investing (and they are a Damocles sword over the poor: giving gifts does not beat giving jobs).

But then Geithner presented a sketch of a plan to make a plan, a ridiculous performance making only clear that he was sending more good money and power to his plutocratic mentors that caused the problem to start with. Then Obama tried to sound knowledgeable about the Scandinavian banking crisis, and used that as a financial guide, looking forward. Too bad, it was “not very good” as (2008 Economics Nobel Laureate) Paul Krugman put it. We will address Obama’s broadside against Sweden in a companion essay. Obama also spoke about Japan, there again missing the essential lesson, which is that if you do not nationalize the banks right away, you will stimulate in vain. Instead Obama repeated well known slogans about Japan, that went to a cross purpose to his blast about Sweden. In other words, according to Obama: Obama, laughing, finds himself deep, while he gives Sweden and Japan a sound zero for poorly executed policy, and being generally ridiculous countries. Change you can’t begin to see.

What do these mental crosswinds mean? The answer is that the conspiracy of the plutocracy against the People is still ongoing. As far as the plutocracy is concerned, Obama is just a change of gear. The plutocracy is stressed, true, but it is still going on strong. Geithner, in a strange semantical pirouette, makes virtue of necessity, by claiming that it will be “tested”, and that stress is good. The plutocracy used to boast that greed was good, now it is stress that is good. The plutocracy is highly adaptive: after all it can pay the best intellectuals, and train them to have the right ideas. (This is nothing new: in Imperial Rome, prostituted intellectuals would be paid billions to be intelligently stupid, and comfort the pro plutocratic propaganda against the People). The Obama administration is confused and incoherent, because it is thoroughly penetrated by the plutocracy (some people call it the oligarchy).
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WHICH SOCIETIES SURVIVE? THOSE WHERE THE PLUTOCRACY STAYS WITHIN BOUNDS, SAYS JARED DIAMOND:
Professor Jared Diamond gave an interview to the US Public Broadcasting Service, Friday, February 12, 2009. He was asked point blank if he could tell of a particular characteristic that made some societies survive, whereas others collapse. That was the central question Diamond tried to address in his book “Collapse. How societies choose to fail, or to succeed”. (It is a question that I have answered from varied angles and degrees of depth. I am happy to report that Diamond’s main answer now fits into my explanatory context. It did not use to.)

Diamond’s answer was sharper than in his book: “It seems to me that one of the predictors of a happy versus an unhappy outcome, has to do with the role of the elite or the decision makers or the politicians, or the rich people within the society. If the society is structured so that the decision makers themselves suffer from the consequences of their decisions, then they are motivated to make decisions that are good for the whole of society. If the decision makers can make decisions that insulate themselves from the rest of society then they are likely to make decisions that are bad for the rest of society.”

One should immediately think of Mr. Rahm Emanuel, Obama’s chief of staff, who is supposed to spearhead the implementation of “change you can believe in”. Although he has no background in science, economics, finance, history or philosophy, just a master of “speech” and a voluntary stint in the Israeli army, and after being an adviser to Bill Clinton, he took a vacation from politics for two years, just long enough to receive more than sixteen (16) million dollars from a bank. Open Secrets reported that Emanuel “was the top House recipient in the 2008 election cycle of contributions from hedge funds, private equity firms and the larger securities/investment industry”. During his original 2002 campaign, Emanuel “indicated his support of President Bush’s position on Iraq”. Now we have to call Emanuel “outstanding” and thank him, a “wealthy businessman”, to do “public service” for us all. Washington politicians say these sorts of things all day long, so they can awe the People with each other outstandingness.

The world stands with bated breath. How likely is it that Rahm Emanuel is going to be tough with the system of corruption that has made him so wealthy, so easily? Change you can’t believe in. Such a degree of official corruption is unknown anywhere else in the world (at least, there, they hide their corruption below more than a TARP!). Now, of course, maybe Mr. Emanuel is a creature of immense moral strength, and, after having immersed himself in the system, maybe he will detonate, and take it down. The audacity of hope.

A case in point, according to Jared Diamond: “the place that they call the City of New Orleans”. One can ask “why over ten years, people in New Orleans did not spend a few hundred millions building appropriate dikes”. Diamond’s answer: “Rich people are living on high ground In New Orleans. Compare with the Netherlands, where “the system of dikes has been called one the Seven Wonders of the World”. “Rich people are not allowed to have mansions on top of the dikes, everybody is down in the polders. Politicians and rich people know that if the dikes failed, they would die”.

And Diamond insists that: “I would like to see the rich people suffer even more, and the politicians suffer even more. Because then they would be motivated to solve all our problems. People often ask me predictions. But that depends so heavily upon which choices we will make, and I don’t know what choices we will make. I don’t know, for example if Obama will be able to pull the country with him, or if we will revert to infighting and a stalemate”.

Well, Obama’s fortune is just about five million dollars, whereas his good friend Rahm has piled up already at least 15 millions. The Clintons are flying high above the rest, with well above 100 million dollars. But then people who have contributed absolutely enormous amount of money, considering their quasi negligible savings, to the democratic campaign, were condemned to receive through the Internet powerful whining, from, say Joe and Jill Biden, to help reimburse Hilary’s debt. That was a few millions, and Hillary is worth more than 100 millions. In the USA, the plutocrats and their servants have no shame. They apparently will not rest as long as the entire population is not reduced to abject servitude. But, and that is the crisis, the Population has started to revolt.
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THE PLUTOCRATIC SCHEME EXPOSED:
I have been trying to explain why the plutocracy always try to take over: it is a force that evolution has built. In a nutshell, hominids, although intrinsically good, are also intrinsically bad. It is actually good that they are bad, in the grandest scheme of things, otherwise hominids would have fallen victim of their own success. Badness, Evil, the Dark Side, is an ecological necessity insuring the survival of the species, by regularly culling it before it can waste its life support systems. In other words, it has never been needed as much. The only question is: who is going to be the ultimate boss? Is it going to be our good side, the Side of Light, or the Dark Side? By directing so much of US power and creativity towards the Pentagon and the plutocracy, the USA has answered that it prefers the Dark Side as the leading metaprinciple.

The Dark Side, Evil, is also one of the two factors insuring a constant pressure, in all societies, towards the creation of an ever mightier, all devouring plutocracy (the other factor is purely mathematical: capital creates ever more capital, proportionally to itself, so exponentially increases). The United States of America is nothing special this way: it has let its plutocracy run amok. And now, as it tries to corral the beast back to reality, the later is acting completely crazy.   

Obama goes around, trying to finesse it, trying to make friends with everybody. But, apparently unbeknownst to his charmed life, he is confronting absolute Evil, enormous forces that their own proponents themselves do not understand. (An example of such proponents is Rush Limbaugh, one of the servants paid hundreds of millions by the plutocracy to spout its message of Evil and seduce the mob with mental waste). Ultimately, these forces want nothing more than to destroy all of civilization: this is the call of the beast, of the human beast in distress, ready to exterminate all.

Extermination: that’s how the species survive. That’s how good people become terrible in a flash. So the “republicans”, the plutocrats, the forces of Evil, start with the State. Succumbing to the Dark Side has its own seduction, its own hormonal rush: the plutocracy can drug itself on wanton destruction. In a nice anecdote, Rush Limbaugh is himself a big time drug addict. The plutocracy made sure that he would escape jail. The audacity of dope.

In truth, it’s all about power, and things have come to a head. The “republican” agenda, starting with Nixon (not Eisenhower), has been to give more power to the plutocracy. The Republican Party is not the party of Lincoln anymore. To a great extent, the Secession War was a war of the industrialized north plutocracy against the much less democratic, enslaving southern plutocracy (which wanted to escape its northern competitor). So the Civil War can be viewed as a war against an inhuman plutocracy. The republican president Eisenhower was, also in the line of traditional modern US presidency, a partisan of industrialization and of giant stimulus such as the construction of the freeway Interstate system (that he decided). Eisenhower also used the military to enforce school desegregation (Eisenhower did not have just a dream, like Martin Luther King; Eisenhower had an army, and he used it against the racist; although MLK was nice, the much harder decision to confront racism with armed force was taken by Eisenhower, not Martin Luther King).

Nixon was completely different from Lincoln and Eisenhower. He had been a principal in the fascistic witch hunt of McCarthyism. He was tricky rather than principled. He turned the US health care system towards giant exploitation by corporations (HMOs), and used public finance to do so. Reagan only accentuated the movement towards the dismantlement of the State, but he had to fight the democratic Congress inch by inch. Nevertheless, the plutocrats were able to impose their entire logical universe, complete with specious facts and biased semantics. Thus the word “republican” is ironical: it’s all about the plutocracy. It is not about the public-thing (res-publica), but it’s all about the power of Pluto. As a result of 40 years of efforts, a much more powerful plutocracy has risen over the land, and has inspired plutocracies of the world to rise ever higher, all over the world. Whereas the Socialist International, or the Communist International envisioned all the proletarians of the world to unite, it’s the plutocrats of the entire world that united. Easy to do. There is no international legal framework to contain them: the plutocracy is global, the law is local. The core of the system was the USA because some countries (particularly France) resisted the plutocracy better. (The Gini index, that measures inequality in a society, saw the French and US graphs cross each other, the French one going down, the US one, going up).
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RUBINOMICS AND PLUTOCRACY; CHANGE FOR THE WORST:
By the time Clinton was elected, it did not really matter what he truly wanted. Rubin, a head of Goldman Sachs, was sent to him to tell him what to do: “make the bond traders happy”. That made Clinton curse, but he did what he was told, and has been well rewarded since. The Rubin group of the Clinton administration was a plutocratic instrument enforcing plutocratic policy. Summers was a trusted aide, and became Treasury Secretary, when Rubin left for more profitable pastures. Geithner, a graduate of Kissinger and Associates, an international company plotting for profit and influence (where he spent three years), was a protégé of both Summers and Rubin (and no doubt Kissinger, thus Nixon, etc…).

Under Rubin’s illuminated guidance, the US heavy industry fell behind, evaporated, or left for China. The plutocracy profited from this by being the indispensable intermediary, worldwide. Rubin amused the People with a bubble or two. But the median income started to go down around 1998. The median income has been nominally flat, but it has been down, inflation adjusted (using the CPI), and dramatically so if one does use just the fake CPI, but the real inflation. Once again, that was Rubin’s great work, not Bush. Bush helped with, but he did not launch the pauperization program. 
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WHY THE PLUTOCRACY IS AT BAY:
Now, just as it was getting richer and more powerful than ever, the plutocracy is suddenly at bay. Why? Unexpectedly, it has been betrayed by its main basis of support, the so far supine US population, that had been carefully trained to act anti-French (that is why anti-French propaganda is a basic staple of the US mental diet ever since Kennedy got assassinated). That means US citizens have been trained to behave as if anything that smacks of the revolutionary behaviors that gave birth simultaneously to the French and American revolutions is in poor taste. Instead, the epitome of modern American taste is to act submissive, and celebrate the riches of the rich, and admire the wisdom of trickle down economics, and all Americans feel proud that Warren Buffet, the world’s richest man, is their grand father. Reagan told them to be good dogs around the table of the rich, and they would get crumbs, so they have been behaving ever since, while the sumptuous dinner of the rich was served, for ever and ever (in truth, average median income has been going down since Rubin, under Clinton).

But now the plutocratic plan of turning the US population into relative serfs has encountered a serious road block. Suddenly, people have had enough. They got to the psychological breaking point, as the subprime plot turned into obvious servitude (thanks to adjustable rate mortgages, and other fine print).

Suddenly 10% of the present and future would-be serfs are refusing to pay the “gages of death” (“mort-gages”). Yes, that’s twelve million homes. The US serfs have discovered that they were paying outrageous rents to the plutocratic banks. Big knowledge, big disaster. The plutocratic banks, and their plutocratic associates, the hedge funds, and foreign powers, had taken all the money, and leveraged it for several times the value of the world, in a hare brain plot for seizing all the power now. So suddenly, all the money was gone. What to do? Well, steal more from people, that is where the money is. Moreover, the banksters reasoned, on the ground that if they did not get the money, the People’s money in savings accounts would disappear, and also, if not, there will be no more banks, hence no more capitalistic and creditist economy. They may even  indeed steal your savings, as they are at it, if you irritate them too much Which savings, anyway? They already spent your savings on their private jets, giant yachts, mansions all over the world, residences in fiscal paradises. private schools, private clubs and golf courses from which to plot further… Now, if you want your savings, you will have to pay your taxes. And don’t forget the bonus for the bankers, or, as they have decided to call it on February 11 2008: the “award”.

Confronted to the collapse of its fist order scheme, the reaction of the plutocracy has been to save its income, by switching to a diabolical second order scheme. In that scheme, the People itself was panicked into bringing voluntarily the money to the bankers.

The plutocracy (and especially Geithner, as the supervisor of Wall Street, and Paulson, a plutocrat, ex head of Goldman Sachs, just like Rubin) invented TARP (Transferring Assets to Rich Plutocrats). TARP, as its name indicates, also covered up, from its very nature as a TARP, what has really happened, namely the extent to which the plutocracy stole and leveraged itself with People’s money, to make itself ever richer and powerful. Hey, if the plutocrats got rich enough, maybe they could have private armies and seize power outright, as happened to Rome (circa 100 BCE). They warmed to the practice in Iraq, sending up to 100,000 private mercenaries there (and it worked, as far as they were concerned). Ah, just when they were within reach!

After the plutocracy got to power in Rome, pushing itself above the republic (that went on in name!), it never quit. So plutocracy can be a sort of black hole that it is very hard to come out of. In the West, it is only when the Roman plutocracy had to leave space to the Frankish plutocracy, that its power went down, six centuries later. The Franks (the “Free”) were more democratic, and spread the wealth much more, to the point they were not keen for the very imperial structure that they built over four centuries (and gave it up, although it went on in a loser system, Feudal Europe). Republics reappeared slowly, over a millennium (first around northern Italy and Russia). The collapse into plutocracy has happened all over, all the time. It happened even to the Mongols, shortly after they had conquered China (that would have made Genghis Khan, a man of substance, furious). The Ming rebellion put an end to that non sense. But, having come from a religious mob, threw the baby out with the bath.
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OBAMA FIRST THREE WEEKS, OR HOW THE PLUTOCRACY HOPES TO GET OUT OF IT:
The conspiracy of the plutocracy against the People is coming to a head right here, right now. The Obama administration is confused and incoherent, because while Obama is fully aware of the need for real economics (the good part of the stimulus), some of his administration is thoroughly penetrated by the plutocracy and Rubinomics.

Obama’s great desire seems to be that, by being kind and considerate to the mighty, the mighty will be kind and considerate in return. It has worked so far, at least for him, and for the party of hope and change. But now the stakes are higher. Whereas the plutocracy long saw Obama as a nice dark, innocuous horse, it is starting to feel that if everybody agrees with him, he could turn into a problem. So it surrounded him with a tight guard of plutocrats and their devoted servants, basically the same one that was used under Clinton (and that led to the disaster of the so called “Bush” years; appropriate graphs show that Great Depression Number Three of the USA started in 1998, under Clinton, although, of course, Bush did deteriorate the situation with his insistence on God and war).

Hence the laughable performance of Timothy Geithner, the Secretary of the Treasury. As Maureen Dowd of the NYT pointed out: “for starters, the 47-year-old’s voice kept cracking”. Geithner has been raised in the shadow of the plutocracy, he knows its power, he is eager to please it, but he also knows the extent of the fraud of claiming that there is no instant solution of the problem of the US financial crisis (because there is). Geithner knows that he is trying to save the skin of the plutocracy, while risking the economy of the USA, even the world, while doing so, and the walls are coming in pretty fast. History is being made, and it’s recorded for posterity. It will be easy, later on to point out how disingenuous Geithner was, and how terribly responsible of the unfolding crisis he was. 

The plutocracy is not without hope: it has the Rubin team back in power, all around Obama, putting the right ideas in his head (such as his pathetic broadside at Sweden, that I will answer in another essay, point by point). Geithner came out all vague, because he is trying to gain time, and avoid what would really hit the plutocracy, namely nationalization. Geithner hopes, against all hope, that, somehow, by using the anti democratic, Dark Side powers of hedge funds, foreign powers and the Federal reserve, plus a utopian rise of the housing market, he will be able to see the derivatives of real estate turn away from extinction. Meanwhile the American People gets all the disadvantages of nationalization, and none of the advantages. The American People is asked to give money to the big banks dozens of times in amounts that are dozens of time what they are worse. In exchange, the plutocrats pay themselves extravagant bonuses, salaries, dividends, and gorge themselves on their continuing power.
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PUT THE PLUTOCRATIC MONKEYS BACK IN A CAGE, FAST, THERE IS SERIOUS WORK TO DO TO AVOID A PLANETARY CATACLYSM:
So what is next? The plutocrats underestimate their opposition, and show signs of decomposition: all they could find is a little boy like Geithner to make their case, sweating at the brow, meek, incoherent, to insist that People should keep on Transferring Assets to Rich Plutocrats. There were giant demonstrations, with millions of protesters … In France.  Those were observed in the USA, and maybe, just maybe, the long buried revolutionary fiber of the US citizen will stir. The taxpayers and serfs of the USA have had it, and the USA is not all alone (as Rome was). In Rome, the confrontation between People and plutocracy was a solitary struggle: the plutocrats used their private armies, killing thousands of protesting citizens.

Seven centuries later, when the Roman Christian plutocracy tried to crush the last intellectuals, the situation had changed. Rome had degenerated so much that it had real competition, not just from the half educated Germans, but from Persia’s Sassanid dynasty, and the increasingly agitated Arabs. The intellectuals and their books fled Romano-Christian terror to Sassanid Persia, and Persia helped them enormously, even unleashing an enormous offensive on their behalf, all the way to the Mediterranean (that help from Persia is mostly how the books of antiquity survived: they passed to the Arabs next). Nowadays, the plutocracy is less powerful in many other countries than the in the USA (France is an example). These countries resist better the pauperization and plutocratization that threatens the USA. That, in turn, may show the American People that a bit of assertiveness is the best way to resist the loud oppression of the unhinged plutocracy.

It is not just a question of whether the USA will become the world’s largest banana republic. In a way, that is already the case, since astronomical corruption is how it is in Washington. More drastically, as we I will explain later, the fate of the planet is at stake.
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Patrice Ayme
http://patriceayme.com/

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Note: Both Congress and the Administration are entangled with the plutocracy. Just two vignettes, on top of what was said above: the present Congress got about 200 million dollars for its election campaign. That’s just the flag on top of the iceberg. Much larger, still, is the promise of cushy jobs, and great influence, upon graduation from Congress. As the Daschle example or the Emanuel example showed, one is talking about many millions of dollars in very few years. These Transfers of Assets to Rich People creates an imbalance of the whole economy, and lots of terrible decisions.

Geithner hired as his chief-of-staff, the lobbyist from Goldman Sachs. The new deputy secretary of state was, until last year, a CEO of Citigroup. Another CFO from Citigroup is assistant to the president, and deputy national security advisor for International Economic Affairs. One of his deputies also came from Citigroup. A new member of the president’s Economic Recovery Advisory Board comes from UBS, which is investigated for helping rich clients evade taxes. And so on, and so forth, down the plutocratic hole…

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