Archive for the ‘Economic Inequality’ Category

Plutocracy: Epigenetics, Not Just Wealth And Democide

December 12, 2016

CHOMSKY FINALLY AGREES WITH PATRICE AYME: AMERICAN DREAM DIED BECAUSE OF PLUTOCRACY… But Chomsky does not go as far as using the word. And that makes him, and his devoted followers, miss the EPIGENETICS OF EVIL. Thus they complain about the fleas, not the wolf carrying them:

***

America did not start as a plutocracy in the sense of an extremely wealthy class ruling. Jamestown was like that, but was it was a tiny hamlet fortress. Then England, wrecked by civil wars and revolutions, lost control of its American colonies until the 1700s. Attempts to make Lord Penn the ruler of Pennsylvania ended up in the American Revolution. Washington, Jefferson, and Al. were very wealthy and somewhat satanic, as they held slaves, but they were small fry relative to European plutocrats, who were much wealthier, and much more satanic.

And on it went. The Confederacy was to some extent a plutocratic revolt centered around the idea of buying, selling and abusing people as if they were chicken: it failed.

The first US billionaire was Carnegie. Carnegie was far left, advocating 50% tax on the wealthy, and punishing estate taxes. His widely advocated ideas brought a mood conducive to the passage of the anti-trust act under President Teddy Roosevelt. 

Inequality Fosters Plutocracy, The Rule, Not Just Of Wealth, But evil & Bad Genes

Inequality Fosters Plutocracy, The Rule, Not Just Of Wealth, But evil & Bad Genes

So when did the US democracy go bad? JP Morgan, a banker, escaped the anti-trust thrust.   Dr. Schacht, a German banker cum economist joined the Dresdner Bank in 1903. In 1905, while on a business trip to the United States with board members of the Dresdner Bank, Schacht met the famous American banker J. P. Morgan, as well as U.S. president Theodore Roosevelt. Schacht  became deputy director of the Dresdner Bank from 1908 to 1915. Meanwhile, when Wall Street collapsed in 1907, JP Morgan “bought all of it” (or at least a big part of it), bringing the market around.

By 1914, US plutocrats, and the racist president Wilson, conspired with the Kaiser, enabling the Kaiser to hope to destroy his enemy, the French Republic. That magnificent plot backfired on Germany when Great Britain declared war to the Kaiser within days of its attack on France.

But it did not backfire for the USA: the US supported the Kaiser for three years with ammunition components, etc., while the UK and France piled up debts to the USA. More exactly, US plutocrats made a fortune, while putting the UK and france in their debt.

In 1919, US plutocrats made it so that German fascists could have another go at the French Republic. Meanwhile, the US requisitioned giant amounts of German private property, then transferred that to US plutocrats, finishing the deal by burning the records of these transactions, in a highly convenient blaze. I am not joking: the cause of the burning of the Commerce Building on January 10, 1921 was never determined: rats, smoking were excluded, and electric wires kept new and perfect. The fire started in the file room, was all over in a couple of minutes, and lasted five hours.

In any case, the US became the de facto overlord of the so-called “Weimar Republic” (the official name was “Second German Reich”; Hitler changed it to “Third German Reich” in 1935). That enabled US plutocrats (some of them Jewish) to turn around the US antitrust law.

The symbiosis between Nazism and US plutocracy was total, including the latter giving birth to the former. Dr. Schacht was central in this (and that’s why he was judged and exonerated, as one of the top 24 Nazi war criminals in 1945 at Nuremberg).

To win the war, the US became, de facto, a sort of social democracy. It slowly went back to plutocracy when Nazi operators and collaborators such as the Dulles brothers, took control of the USA in the 1950s. A quick learner and follower, R. Nixon, became president in 1969, setting up the HMO system, while making an alliance with the Chinese dictatorship.

Ford, Carter, Reagan, ramped up the plutocratic pressure. The dam broke under Clinton, who actually dismantled the MOST IMPORTANT legislative piece of president Franklin D Roosevelt’s long presidency: the Banking Act of 1933 (“Glass Steagall”).

The Deep State, suitably plutocratized then established a number of evil corporations which were used as intelligence agencies (internally and externally). This is when Sheryl Sandberg was parachuted from the Treasury Department where she was the official girlfriend of Lawrence Summers (successor of R. Rubin, ex- Goldman Sachs chair) to Google and then Facebook (she will meet with Trump Wednesday).

Inequality grew.

***

Chomsky, A Crow On Its MIT Branch, Crowing Lugubriously:

That was for the causes. Chomsky started to condemn the “financialization” of the USA for the acceleration of inequality in 2013, under Obama (Patrice Ayme explained that it was caused by the abrogation of the Banking Act, already more than 10 years ago; Chomsky vaguely describes, Patrice explains…).

Here is Chomsky’s latest description: “The ‘American Dream’ was all about class mobility. You were born poor, but could get out of poverty through hard work and provide a better future for your children. It was possible for [some workers] to find a decent-paying job, buy a home, a car and pay for a kid’s education… It’s all collapsed — and we shouldn’t have too many illusions about when it was partially real… The so-called American Dream was always based partly in myth and partly in reality.” Chomsky said, noting that Americans are losing their hope due to “stagnating incomes, declining living standards, outrageous student debt levels, and hard-to-come-by decent-paying jobs.”

“The inequality in the contemporary period is almost unprecedented. If you look at total inequality, it ranks amongst the worse periods of American history… However, if you look at inequality more closely, you see that it comes from wealth that is in the hands of a tiny sector of the population…

The current period is extreme because inequality comes from super wealth. Literally, the top one-tenth of a percent are just super wealthy,”

Chomsky describes. One of my trusted commenters asked me recently what I thought of Chomsky. A philosopher is not just a botanist. A philosopher would explain. Chomsky also avoid to use the concept of “plutocracy”. He describes it, he describes how wealth, being powerful, grabs power.

***

Plutocracy, Epigenetics of Evil:

However, that comes short. Very short. Chomsky does not dare to cross the semantic Rubicon of calling it for what it is, the genetics of evil.

This is why Chomsky clings to the idea that the American Founders debated what is at stake now. Now, they did not: the Internet has changed everything, starting with the minds, the moods, hence the genes, or the genetic expressions, to be a bit more precise. We know that fishes in a changed environment, change genetically. Females can become not just males, but super males.

Plutocracy is not just the rule of wealth. We know, from studying epigenetics in other species, that animal behavior influences genetic, let alone neurohormonal expression.

The absolute power of enormous wealth does not just corrupt absolutely, it corrupts genetically.  

Complaining about the fleas is good, but seeing the wolf carrying them, better. Wisdom is not just about seeing, but doing it better.

Patrice Ayme’

Obama, Clinton: Stealthily Regressive

November 2, 2016

So much lying! So much naivety! Oh Blah blah! Obama! Obamacare! Obama cares not: yes, GDP of the wealthiest, the .1% has been growing. But, in truth, Clinton and Obama were the most stingy presidents of the last 66 years. Far from being progressives, they were the top two regressives and regressors. Here is the graph:

Clinton And Obama Were The Less Progressive Presidents In 66 Years

Clinton And Obama Were The Less Progressive Presidents In 66 Years

I do not expect the insulting fanatics who worship Clinton and Obama to understand the preceding graph. Let me explain a bit more for the others.  The graph above looks at United States government purchases of goods and services. It looks at the purchases at all levels: local, state, and federal. Such purchases are, actually buying real stuff, and work, in contradistinction with transfer payments like Social Security and Medicare.

[Why was there a decrease around 1950? Because of super giant spending due to the Second World War, just prior; after that enormous spending, a retrenchment was in order. However, notice that President Ike brought up spending to 25%! Thus, if one makes, say a five-year rolling average, Clinton and Obama are the lowest in Net Government Investment since… President Hoover; that was 83 years ago; and even Hoover did the Hoover dam, and much more. One can advantageously consult “Wealthcare Endless Summers“.]

Obama has been far from presiding over a huge expansion of government the way he himself and the right-wing, Neoconservative fanatics who now support Hillary Clinton, claim. As a matter of fact, Obama presided over unprecedented austerity, in part driven by spending cuts at the state and local level. Thus it is an astounding triumph of misinformation and disinformation that lackluster economic performance since 2009 has been interpreted as a failure of government spending. Let’s zoom in on Obama’s first term:

Obama Cliamed He Was A Big Spender. Instead, He Spent Big Only On His Friends, The Plutocrats, Soon To Provide Him With Beaucoup Bucks

Obama Cliamed He Was A Big Spender. Instead, He Spent Big Only On His Friends, The Plutocrats, Soon To Provide Him With Beaucoup Bucks

Here it is, massaged differently:

Clinton And Obama, By The Measure Of Annualized Growth Of Real Government Spending, Were The Two Most Conservative US Presidents

Clinton And Obama, By The Measure Of Annualized Growth Of Real Government Spending, Were The Two Most Conservative US Presidents

[Source: Economist View.] So now the hysterical ones on the pseudo-left tell us that Hillary Clinton is not at all like Clinton, Bill, her husband and Obama, her supporter. It is indeed likely: Clinton says she will spend more in education and infrastructure. How much she can deliver with a hostile Congress, is something else. However, Trump has clamored for more government spending since ever. Trump lambasted the decrepit infrastructure of the USA while Obama (and Clinton), in chief command, did nothing about it.

I have said that government spending should be massively  augmented, for years. (But intelligently augmented, a big but, not a big butt!) Even Krugman, the Clinton sycophant, has joined my long held opinion. Here he is, in August 2016:

Time to Borrow, by Paul Krugman, NY Times: …There are, of course, many ways our economic policy could be improved. But the most important thing we need is sharply increased public investment in everything from energy to transportation to wastewater treatment.

How should we pay for this investment? We shouldn’t — not now, or any time soon. Right now there is an overwhelming case for more government borrowing. …

First, we have obvious, pressing needs for public investment in many areas. … Meanwhile, the federal government can borrow at incredibly low interest rates: 10-year, inflation-protected bonds yielded just 0.09 percent on Friday. …

Spending more now would mean a bigger economy later, which would mean more tax revenue…, probably be larger than any rise in future interest payments. And this analysis doesn’t even take into account the potential role of public investment in job creation…”

In any case, no president did worse than Obama, except for skirt-chaser-thanks-to-government-clout Clinton. Would the Clinton of the future be different from the Clinton of the past? Hillary hysterics foam at the mouth, and assure us, that such will be the case. However, as many called me a racist, xenophobe, fascist, hater of Muslim People, Trump lover and even less flattering term, in public, on the Internet in recent days, I now strongly doubt that they are capable of informed judgment.

Yes, be it Hillary or President Trump, real government spending will grow. Both from what they said, and who they are (Trump is a builder used to take loans and invest rather profitably). But also because, after eight years were Obama “signature achievements” consisted in bombing weddings in Yemen, in “signature strikes”, and deploying the health plutocrat friendly (think Buffet) Obamacare, real government spending could not be any lower.

Or then, it was a farce: consider the US government spending on Elon Musk (a South Africa born entrepreneur). If Trump is elected, SpaceX is gone in a year. And so it will be all over: watch Amazon go down in flames. Yes, I do finance heavily my local bookstore, and yes I purchase only two books once at Amazon. Nobody os perfect.

But those who say that Clinton and Obama were progressives, are either liars or ignorant, or cruel, or all the preceding. It is one thing to no be perfect. It is another to wallop in error: to persevere in error is diabolical, the Romans said (“perseverare diabolicum”).

Again, look at this:

I invest Nothing For You People, Becausae You Are Unworthy. Call Me Progressive, Like The Annaconda Who Progressively Squeezes

I invest Nothing For You People, because You Are Unworthy. Call Me Progressive, Like The Anaconda Who Progressively Squeezes

[Notice the dearth of spending under Clinton. Pelosi-Bush invested, until last 3 months of 2008, when Pelosi-Obama signed on Bush’s Sec. of Treasury Paulson’s plan. Pelosi-Obama invested in plutocrats thereafter (mostly, although there was a small genuine ‘stimulus’ which worked wonders).]

I expect feeble minds and cultural retards to not understand such a graph. They will probably revert to insults. And I do not expect them to understand what this means for analyzing the reasons for the frantic support of the Obamas for Clinton. You see, ultimately, investing is a zero sum game, in the instant: the US government did not invest, because all its discretionary money went to plutocrats. And this is why the Main Stream Media, held by plutocrats, is so anti-Trump. Trump, who is one of them, plutocrats, know very well where the investment streams are going. If Trump wants a bigger name, and he does, he will have to divert them, towards We The People. And all and any president, but for Clinton, did this, investing in the USA, better than Obama did. Since president Hoover.

In retrospect, those who wanted progress, at least by the measure of investing in the country, should never have voted for Clinton or Obama. How can one hope that the creature closest to them would be any different?

Patrice Ayme’

US Plutocrats: Delaware, Not Panama

April 8, 2016

I long said that the USA was the world’s number one tax haven, followed by Great Britain. And this is exactly why these two countries are the seat of global plutocracy. (London boasts that it is the world’s number one financial place, ahead of New York.) The New York Times in “Need to Hide Some Income? You Don’t Have to Go to Panama”, April 8, 2016:

“For wealthy Americans looking to veil their assets and shield some of their income from taxation, there is no need to go to Panama or any other offshore tax haven. It’s easy to establish a shell corporation right here at home.

“In Wyoming, Nevada and Delaware, it’s possible to create these shell corporations with virtually no questions asked,” said Matthew Gardner, executive director of the Institute on Taxation and Economic Policy, a nonprofit research organization in Washington.

In some places, it can be more difficult to get a fishing license than to register a shell company. And it doesn’t cost much more.”

Delaware Is The World’s Pluto Center. 285,000 Companies Are Registered In That Delaware Building Alone.

Delaware Is The World’s Pluto Center. 285,000 Companies Are Registered In That Delaware Building Alone.

Delaware allows companies to shift the seat of their business and their profits to Delaware, where, conveniently, there is no tax.

Speaking of the Panama Papers, “This is just one firm [Panamanian Mossack Fonseca law firm] in one place,” said Gabriel Zucman, an economist and the author of “The Hidden Wealth of Nations: The Scourge of Tax Havens,” “So it cannot be representative of what’s happening as a whole in the world.”

“But Mr. Zucman, who estimates that about 8 percent of the world’s financial wealth — more than $7.6 trillion — is hidden in offshore accounts, said another reason was that it is so simple to create anonymous shell companies within the United States.

Wealthy individuals and businesses that want to mask their ownership can conveniently do so in the United States, and then stash those assets abroad.

Yet while the United States demands that financial institutions in other countries share information about Americans with accounts overseas, its reciprocation efforts fall short, critics say.

“You see a ton of wealth in tax havens in Switzerland and the Cayman Islands that is owned by shell companies that are incorporated in Panama or in Delaware,” he said. “The bulk of this wealth does not seem to be duly declared on tax returns.”

The Institute on Taxation and Economic Policy in “Delaware: An Onshore Tax Haven” observed that the state’s obscurity, combining with a loophole in its tax code “makes it a magnet for people looking to create anonymous shell companies, which individuals and corporations can use to evade an inestimable amount in federal and foreign taxes.”

***

Not to think the New York Times is going against the branch on which it sits, plutocracy. The preceding extracts were hidden away from the electronic front page. What we found on the front page was Krugman going all-out against Bernie Sanders in Sanders Over The Edge.

A good way to say bad things is to sound reasonable’ Krugman excels at that:

“…most liberal policy wonks were skeptical about Bernie Sanders. On many major issues — including the signature issues of his campaign, especially financial reform — he seemed to go for easy slogans over hard thinking. And his political theory of change, his waving away of limits, seemed utterly unrealistic.

Some Sanders supporters responded angrily when these concerns were raised, immediately accusing anyone expressing doubts about their hero of being corrupt if not actually criminal. But intolerance and cultishness from some of a candidate’s supporters are one thing; what about the candidate himself?

Unfortunately, in the past few days the answer has become all too clear: Mr. Sanders is starting to sound like his worst followers. Bernie is becoming a Bernie Bro.

Let me illustrate the point about issues by talking about bank reform.

The easy slogan here is “Break up the big banks.” It’s obvious why this slogan is appealing from a political point of view: Wall Street supplies an excellent cast of villains. But were big banks really at the heart of the financial crisis, and would breaking them up protect us from future crises?”

Actually Krugman is a specialist of trade, not banks. Bank specialists like Simon Johnson, have called for the break-up of the 21 biggest banks (which are recognized as special by the present US government).

Krugman detests Sanders saying Hillary has no clothes:

“It’s one thing for the Sanders campaign to point to Hillary Clinton’s Wall Street connections, which are real, although the question should be whether they have distorted her positions… But recent attacks on Mrs. Clinton as a tool of the fossil fuel industry are just plain dishonest, and speak of a campaign that has lost its ethical moorings.

And then there was Wednesday’s rant about how Mrs. Clinton is not “qualified” to be president.

What probably set that off was a recent interview of Mr. Sanders by The Daily News, in which he repeatedly seemed unable to respond when pressed to go beyond his usual slogans. Mrs. Clinton, asked about that interview, was careful in her choice of words, suggesting that “he hadn’t done his homework.”

But Mr. Sanders wasn’t careful at all, declaring that what he considers Mrs. Clinton’s past sins, including her support for trade agreements and her vote to authorize the Iraq war — for which she has apologized — make her totally unfit for office.”

Speaking of exhibiting extremely deep, vicious dishonesty, I sent the following comment, it was censored:

It was obvious, during the ramp-up to the Iraq war that the top leaders of the USA had lost their mental balance. The United Nations did not believe their lies and refused to give them an authorization to attack Iraq. Bush attacked, without a UN Security Council authorization, because he was supported by New York Senator Clinton. The invasion of Iraq by the US caused millions of people to die or being wounded. It brought the Islamist State.

Those who engineered this debacle should have been prosecuted for crimes against humanity. Suggesting they are decent, because they apologize, is to deny civilization has merit. Proposing to be led by them again is proposing to learn nothing from the past.

Specialists of banks long suggested to break big banks and big shadow banks (Simon Johnson, 2009). This is not a revolutionary proposition. Teddy Roosevelt broke big oil. When President Franklin Roosevelt came to power, he closed all the banks. That was much more revolutionary.

Global trade treaties enabled giant corporations to extend their monopolies to the entire world. This way, they escape local legislation. An example is the “Double Irish” Apple Inc. and many other corporations use. The CEO of Apple admitted that two-third of the profits of Apple were not taxed.

End of my comment. Krugman never mentions subjects such as the preceding with the angle I use. In his world, big banks, big trade, big bucks, etc. are absolute big goods.

Hillary is his “sis”, with a bit of luck, she will be grateful, and make him big something, some more. Heathens such as me, with their strident Clintonophobia, have no doubt “not done our homework” because, like Sanders, we are just reprobate school children of no intellectual merit.

Try not paying taxes, as big fishes do, if you are a little guy. You will be sent to jail, anywhere in the West. Plutocracy central? You bet!

Another, completely innocuous comment of mine to Krugman later in the day was also censored. Krugman’s post was entitled “Why Cruz is worse than Trump“. Exactly what I have been saying for five months. I guess the dear professor noble Nobel whatever, is not too keen to expose where he gets (some of) his inspiration from. These are sad, nervous days, for those who love plutocracy, the old fashion way.

Nine 5 Star Hotels In Bariloche, Argentina, & Golf Courses To Receive Obama & His Secret Service, In Style, Next Year

Nine 5 Star Hotels In Bariloche, Argentina, & Golf Courses To Receive Obama & His Secret Service, In Style, Next Year

In “USA Financial Extortion“, the essay linked to at the beginning of this essay, I pointed out the connivance between New York “Justice” and financial “Vulture Funds”. Meanwhile, the son and scion of one of the richest persons in Argentina was duly elected president, and Obama rushed to celebrate him, after 15 years of cruel, demented, anti-Krugman, anti-financial plutocracy rule in Argentina. That new Argentinian plutocrat and president is called Macri. He is a dancer. It turns out he was the name on shell companies in several places of the Anglo-Saxon plutocratic empire (such as the Bahamas). That was just revealed in the Panama Papers. Never mind.

Macri, as president, reduced the arrogant financial demands of the lower classes in Argentina: he needs all the money in the world, to pay his Vulture Fund friends in New York, whom Obama serves so well. So brand new president Macri threw more than one million people in poverty, by gutting their allowances: more than 2.5% of the total population of Argentina. Such is the way of the admirers of Reagan: make the rich richer, and the economy will reward you (thus, when Obama came to power, he saw the economy and its big banks were sick: so he gave all the money in the world to the big banks, and reduced the tax rates of the hyper rich by 20%, and now you can see the economy is right).

In any case, throwing more than a million to the poor house is glorious: not bad in a few weeks of assuredly very presidential work. Maybe Macri’s dad can propose newly retired super star noble Nobel Obama some 5 star stay in Bariloche, next year? Just an idea. What are friends for, among the world’s rulers, if not grateful?

Patrice Ayme’

Global Trade Outlaws Rule

March 9, 2016

FREE TRADE IS NEITHER FREE, NOR A TRADE

Sanders’ surprise victory in Michigan, a big industrial state, is attributed to his attacks against so-called “free” trade (Clinton has never seen a “free” trade treaty she did not love). Ditto for Donald Trump’s victory in the same state (Trump has proposed a 45% tax on Chinese imports). Polls show angry white males and the young (for Sanders) are voting against the system which brought to them the globalization of pauperization. Rightly so.

Let me provide more needed theory:

As it is, globalization means plutocratization.

First, globalization without redistribution implies plutocratization. (As Paul Krugman asserts.)

Second, globalization of trade without globalization of law amounts to trade without law. Thus, organizations, corporations and plutocrats presently engaged in global trade are, technically, out-laws.

Third the immense fortunes gathered by the trade outlaws have enabled them, in turn to pay well their servants in politics and national administration to further the very out-lawfulness which has made them prospered.

Fourth, under the Clintons in the 1990s, the Banking Act of 1933 was replaced by financial deregulation, which spread worldwide, making financiers masters of world trade.

Real Family Income Is Going Down. Real = Including CPI. If One Included Real Costs Beyond The CPI, The Real Income Would Collapse Even More. If I had Put On This Graph GDP or Trade, Both Of These Curves Would Be Shooting Up

Real Family Income Is Going Down. Real = Including CPI. If One Included Real Costs Beyond The CPI, The Real Income Would Collapse Even More. If I had Put On This Graph GDP or Trade, Both Of These Curves Would Be Shooting Up

One of my commenters and friends told me that it is president Carter, a democrat, who had started the degeneracy we presently enjoy. I was surprised, and initially denied. However, I looked and various graphs, and, to my dismay, he turned out to be right. As I learn more about what happened, I will integrate it in my discourse (Carter, of course, attacked, secretly, Afghanistan on July 3, 1979, so he was not highly considered here; but now he is heading evwen lower!)

In other words, we are engaged in a nonlinear process: the global trade outlaws are getting ever more powerful, and, the more powerful they get, the more they advance their plots and breathing together (con-spirare, conspiracies),

Meanwhile, We The People, are getting ever more destitute (the CPI, the Consumer Price Index, does not include LIFE ESSENTIALS such as education, health care, retirement).

Let me give you an example of the degeneracy of US society: I had an insurance agent for two decades, who worked at one of the most prestigious insurance companies in the USA. Last Spring he got sick. Although a well paid professional, he did not get health care in a timely manner. So he died of pneumonia. He was in his forties (basically the age when one gets sick the less). I know dozens of similar stories. Meanwhile, US healthcare is 50% more expensive, per head, than health care in the most performing healthcare systems in the world.

What does that have to do with the globalization of trade? Massive globalization led to massive plutocratization, and that, in turn, led to US politicians and civil servants doing exactly what plutocrats and their corporations wanted them to do (so that politicians and civil servant would make their future income up, as the good agents of plutocracy whom they are).

 Then the one who led us for 40 years, the one who makes more than 200,000 dollars in an hour, giving secret talks to financiers, claims to represent We The People. We The People are earning 10,000 times less (2,000 x 4.5) than she does, per hour. How can she represent, or even understand, us? Is that realistic? No wonder some of us want to protect themselves.

Paul Krugman, the architect, under president Ronald Reagan of “free” trade, presents as self obvious that Sanders’ program is “unrealistic”. Says Krugman: “The Sanders win defied all the polls, and nobody really knows why. But a widespread guess is that his attacks on trade agreements resonated with a broader audience than his attacks on Wall Street; and this message was especially powerful in Michigan, the former auto superpower. And while I hate attempts to claim symmetry between the parties — Trump is trying to become America’s Mussolini, Sanders at worst America’s Michael Foot — Trump has been tilling some of the same ground. So here’s the question: is the backlash against globalization finally getting real political traction?”

Well, I tell you why, Paul: We The People are getting tired of ‘the conscience of a liberal” who got to work engineering Ronald Reagan’s sinister plot to claim that giving to the rich was the best way to give to the poor. Krugie boy is on his best defending his position at the altar of “power”:

Paul Krugman: “The truth is that if Sanders were to make it to the White House, he would find it very hard to do anything much about globalization — not because it’s technically or economically impossible, but because the moment he looked into actually tearing up existing trade agreements the diplomatic, foreign-policy costs would be overwhelmingly obvious. In this, as in many other things, Sanders currently benefits from the luxury of irresponsibility: he’s never been anywhere close to the levers of power, so he could take principled-sounding but arguably feckless stances in a way that Clinton couldn’t and can’t.” 

That’s obviously a ridiculous thing to say: the USA has basically to get accord from just one power, the French Republic, which is all for putting the brakes on soul-less globalization (always has been, for about a century, whether governments are from the so-called right, or left). Then, automatically Germany, Italy and Spain (with, or without a government), will follow. Tax cheats such as Great Britain, Belgium and the Netherlands are going to increasingly feel the whip, and better shut up. (A few days ago, France told Britain that she would open the refugee gates, if Britain left the EU. So Britain is going to have to face unexpected costs, in all ways.)

The World  Trade Organization, prodded by France, already announced that a carbon tax, imposed worldwide, was NOT in violation of WTO rules. So one can start with that, on day one. See what it does for the price of Chinese steel and Chinese solar panels.

In all justice to Krugman, he finishes this way: …”the elite case for ever-freer trade is largely a scam, which voters probably sense even if they don’t know exactly what form it’s taking.

Ripping up the trade agreements we already have would, again, be a mess, and I would say that Sanders is engaged in a bit of a scam himself in even hinting that he could do such a thing. Trump might actually do it, but only as part of a reign of destruction on many fronts.

But it is fair to say that the case for more trade agreements — including TPP, which hasn’t happened yet — is very, very weak. And if a progressive makes it to the White House, she should devote no political capital whatsoever to such things.”

It is a huge “if”. I would be astounded if Clinton made it to the presidency.

After decades of increasingly corrupt, venal, lying politicians whose idea of policy is to do what the world’s richest corporations and their plutocrats want them to do, what could be worse?

Having someone reigning again who got paid a fortune repeatedly for plotting in secret talks with financiers what would be the next move to enrich that elite? Under Bill Clinton, the Banking Act of 1933 was destroyed, bringing the reign of unrestrained finance. Moreover global trade treaties got signed, which allow corporations and their corporations to escape taxation and legislation. How electing Trump or Sanders could make it worse?

When Clinton was asked why she accepted so much money from Goldman Sachs, for so little “work”she replied: “I guess that’s their rate!” She refused to release any transcript to the flood of talks she gave to financial conspirators and outlaws. And you know what? Thanks to the stubborn work of individuals such as yours truly, this sort of rotten mentality is now exposed, and nobody wants to be led by it anymore. Not even the people supporting Ted Cruz.

Paul Krugman’s dream of another cabinet job, 35 years after the one he enjoyed with his boss, Reagan, is fading away…

Patrice Ayme’

WHAT’s WRONG WITH THE ECONOMY?

January 15, 2016

The strategy. The tactics. Everything. Since 2008, the central banks have created money. Why? Key actors of the economy lost too much money in 2008 to keep on functioning. Some of these actors: banks and “shadow banks”.

How did the central banks create money? Mostly by buying government debts from the large private banks. The banks thus made money. Who caused the 2008 crisis? The banks. Thus the very strategy used is Orwellian, and promotes a vicious circle. Upon closer inspection, the situation deep down inside is more of the same and even worse.

The result has been a faltering of economic growth, a creeping destitution of the 99.9% in the West, and the blossoming of colossal inequalities and corruption, worldwide:

Inequality Has Brought Down World GDP Growth. And Bringing That World GDP Growth Too Low Brings War

Inequality Has Brought Down World GDP Growth. And Bringing That World GDP Growth Too Low Brings War

True, banks are more regulated than in 2008 (but much less than before the Clinton presidency brought devastation to the regulation of finance!) However, a large, maybe the largest, part of the banking system is “Shadow Banking”. That’s not regulated. By fostering fiscal heavens and anonymous financial entities, Great Britain and the USA are actually expanding the “Dark Pools” of money which feed “Shadow Banking”.

So what have the banks done with the money generously given to them by central banks? Did they invest it somewhere fabulous? No. There has been no new technological, industrial, economic, social breakthrough which needed, and provided with, the opportunity of massive investment.

(There were some efforts towards “sustainable energy”, but those subsidies and regulations are dwarfed by those in favor of fossil fuels, which total 5.5 trillion dollars, according to the IMF; the key is fossil fuels do not require much new investment, including in research, development and education as new energy sources would.)

No new nuclear program was instituted (say replacing all old reactors with better and safer ones), no thermonuclear powers plants (although a crash program would have probably produce those already), no massive space program (comparable to Apollo in the 1960s).

Even biomedical innovation, hence investment, has petered down (research has been smothered down by marketing, regulations, and cut-throat academia producing poor research).

But, mostly, there has been no new construction program in housing and physical infrastructure. Oh, there is a massive need: the dearth of housing is why real estate is getting out of reach of the middle class, in the top cities, worldwide. (Moreover one can now make positive energy buildings, which produce energy.)

And don’t forget public education has been let go to waste, in the leading countries (with few exceptions: Switzerland, Canada…) It is as if the leadership in the West was afraid that We The People would get knowledgeable and smart.

So where did the money the banks were given by the central banks go? To hedge funds and the like. To the industry of HOT MONEY. One day they buy this, the following week, they sell it, making money, both ways (thanks to financial derivatives). The money created by the banks (which are better regulated, as I said), at this point, once given to financial manipulators, escapes regulation (that’s the whole idea).

“Leaders” know about this. But they obviously intent to keep on getting money from shadow financiers. An example: Obama did not try to tax “carried interest” by hedge funds (although Donald Trump proposes to do so!)

The leading states (USA, UK, EU, China, Japan, etc.) believed that to provide money (“liquidity”) would relaunch the economy. Absent this, massive devaluations would help. Thus Japan devalued by 50%, undercutting South Korea and China severely.

Meanwhile the IMF has allowed these competitive devaluations, following the advice of economists such as Friedman, Krugman. However, this is tickling the tail of the worst devil. War. Economic war is the first step to all-out war, indeed. Competitive devaluations are a form of war.

And what’s the main mission of the IMF? Preventing economic war between the states. This is why the IMF has been created in 1945: “The International Monetary Fund (IMF) is an organization of 188 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.”

Thus the IMF is failing to do its main job. Notice that many American economists, from Friedman to Krugman, in their anti-European frenzy, have pleaded FOR the economic war of (European!) state against (European!) state, thanks to competitive devaluations.

Notice too that Abenomics, the devaluation of Japan, has not had much of a dent: Japan is still mired in stagnation, no doubt still afflicted by its main problem, the collapse of its population (a problem many developed countries have, especially in Europe; the USA and UK have escaped demographic collapse, mostly through massive immigration).

The world economic strategy reflects the mood of the times: the so-called “free market” is all the thinking and activity we need since Ronald Reagan. That’s in contradiction with policies followed by Colbert, Henri IV and Sully, or even emperors Diocletian and Darius. (Darius reigned over Persia 25 centuries ago.) They, like Julius Caesar, thought that the economy had to be governed by the state.

Will China try a massive devaluation, a la Abe in Japan?

Since 2008, the governments, mostly in the West, have been cowardly. The USA suffers from massive inequalities (and no, Mr. Obama, the situation is no as good as eight years ago), the European Union suffers from too much regulations (including at the level of services, where the European UNION has not been implemented), China is a dictatorship which became richer by exploiting workers relentlessly, etc.

Those competitive devaluations and lots of money sloshing around have been addictive: central banks engage in them, to give the states space, and the states, momentarily relieved, put off necessary reforms.

Inequalities suck up “liquidity” (so power and means) from average people, while putting huge amounts of money, and power, under the control of a few hands. And this money is invested in liquid investments, instead of serious things such as massive, affordable, state of the art housing and cities. Thus this money slosh around the world, like the waves of a tsunami, devastating all it touches (example: Greece, Spain, Portugal, Ireland, Iceland, etc.).

The reason the crisis goes on is the confusion between symptoms and disease. That the main actors in power have interest not to understand the nature of the crisis explains why understanding has not been fostered. Thus very few economists have seen it, let alone politicians. (From Obama down to Nancy Pelosi, Krugman, and countless “Republicans”, but also French Socialists, EC bureaucrats, USA universities professors, most actors of influence have interest to sound as intelligent as cows watching a train pass.)

How did the world come out of the slump of the 1920s to 1940s? Through reconstruction in the “30 glorious years” after 1945. Reconstruction from total war. Something to think of. One thing: many countries are on the verge of implosion. One culprit? The obvious world devaluation blatant in the collapse of the price of oil.

What is the way out of the world socio-economic crisis? The same way as it was done after 1945. Massive social, educative, health and construction programs in the West,  building a useful economy, by taxing those who create the inequalities, and grab all the economy, and opportunities to themselves.
Patrice Ayme’

Long Live The Euro: Kaiser, Vichy, USA, Mitterrand

January 9, 2016

Paul Handover from Learning From Dogs asks: “What do you believe is fuelling the British unhappiness with the EU? The ‘Brexit’?”

First, EVERYBODY is unhappy about the European Union: worst system ever, except for its absence, which would be a return to European Civil War.

But it won’t happen, the European Union will endure, because the French and the Germans have learned their lesson: Democracy, Human Ethology, & the Republic won. As early as 1940, even in ephemeral victory, the Nazis had to shake the hands of the victors of World War One, while penetrated by the ominous feeling that they could not win that one.

Even the Nazis Had To Collaborate With Their French Enemy in 1940. (French Petain, Victor of Verdun, To The Left. Loser of World War Two, To The Right.)

Even the Nazis Had To Collaborate With Their French Enemy in 1940. (French Petain, Victor of Verdun, To The Left. Loser of World War Two, To The Right.)

At this point, the first week in 2016, the Germans are angry against the Danes, who took some action because they were angry against the Swedes, the latter being suddenly irate at the flood of Muslim refugees (of the order of 3% of the population of Sweden… As if the USA had suddenly to accept ten million Muslims, and thus quintuple its population potentially subscribing to what Obama calls the “Cult of Death”).

What happened? The Muslim flood flows along the famous bridge between Denmark and Sweden, and Sweden closed the border. Denmark had no choice but to close its border too, the one with Germany, lest the refugees pile up in Denmark.

Last time there was a serious problem with these borders, the Nazis were around; the Nazis attacked Denmark, on their way to a bloodbath in fierce Norway. Denmark fought six hours (still killing more than 200 Nazis, which is better than what the USA could say at the time!) At the time the Nazis and Sweden were buddies, and the French Republic and Britain were actually preparing to attack… Sweden.

The Schengen Area anticipates provisional closures of borders in case of emergencies. Great Britain does not belong to Schengen, but Norway, Switzerland and Iceland do.

***

Why Are The Brits So Angry Against The European Union?

Because the plutocrats fear the EU. Plutocrats loved a fascist Germany, Italy, Spain, Portugal, and Eastern Europe. However the sneaky French have made the European Union into a way to propagate “democracy” and the Republic throughout Europe.

British based plutocrats and American plutocrats only wanted a big market, without a government, so they could do their thing. Instead they got a partial government in the EU, which causes them more trouble than the supine Washington administration.

Plutocrats are not happy with Europe. But, wait, they have in England a supine, gullible population which believes the Queen, when she tells them her family invented Christmas around 1850!

So far, so good: plutocrats and their 20,000 lobbyists at the European Parliament in Brussels have been able to maintain a tight grip on European institutions. However, all over, national movements are growing. The most worrying is the French National Front, headed by European Member of Parliament and lawyer, Marine Le Pen. Le Pen has said things about banks strikingly similar to what I have said for years, and it’s easy to see where she wants to go: easy money (although she claims she wants to exit the Euro, this is clearly a negotiating position; the mitigating alternative is to modify the European Central Bank Charter).

But the plutocrats can only be afraid of the engineer at the heart of the European Union: the revolutionary, ever-closer-Union spirit which animates France. At this point, France is the only country left with fangs in Europe, and plutocrats can only be afraid that the European population is suddenly going to figure out what is going on, all the divisions and exploitation plutocracy has set up, to make all Europeans more miserable than they need to be.

So the plutocrats decided to sabotage the imposition of the “EVER CLOSER UNION” clause in the EU (de facto) Constitution. How? By instilling, through their control of the media, EUROPHOBIA in the British population. That insured that Europe would become the largest market in the world without government, and ideal playground for plutocracy (whereas in China, say, one has to be careful: corruption in excess can be rewarded by a bullet in the skull).

The EVER CLOSER UNION is a dagger plunging ever closer to the heart of plutocracy.

An example: the French State has been pushing for a “Banking Union” (which Germany has resisted as it fears for its small banks will be found bankrupt). As it is the “Banking Union” inspection regime will apply only to the 200 largest banks.

Another example: the French somehow persuaded the Germans to establish a minimum wage as high as the French one. A few other tweaks friendly to labor, and, presto, German workers are now slightly more expensive than French ones.

***

Off With The British Anti-European attitude:

Britain, as it is, is just the second largest carrier of global plutocracy. It has systematically blocked all deepening of the European Union. The Greek crisis (truly mostly a European bank crisis, as in Spain, etc.), and now the terrorist and refugee crises show clearly that Europe need an EVER CLOSER UNION. So does the fact only the French Republic is in all out war in half a dozen countries, trying to block the Islamist crisis. (Other powers are barely supporting France, but should, as UK PM David Cameron himself had to point out to the British Parliament.)

France and Germany have started to understand they need to act unilaterally: it’s the simplest thing. Franco-Germania elaborates a policy, and presents it. Franco-Germania is a superpower: it’s impossible for the European Commission, the European Parliament and the European Council to oppose that bicephalic creature.

Only Britain could cause problem. Obvious solution: eject Britain from the EU, and reduce it to the status of Switzerland (taking orders, as it has proven incapable of elaborating them).

Unfortunately, it will probably not happen: Cameron has seen the danger, and presented a series of lame requests to the EU. Preoccupied as they are by real problems, the other Europeans are just going to brush him off, after making one or two inconsequential concessions. After all, if the EU was good enough for PM Thatcher, why isn’t good enough to the average Brit?

The Maastricht Treaty (most of today’s EU Constitution) was approved by plebiscite in the French Republic (it squeaked in by 51%). Let the Brits vote for a change.

***

USA Based Plutocratic Machinations:

I observed that:“The USA became the world’s prominent economic power by helping the Kaiser in World War One”

Gloucon X, a commenter on this site is skeptical about my assertion: “I couldn’t find any numbers to support that statement. In fact U.S. trade with the Central Powers fell from $170 million in 1914 to virtually nothing in 1916. On the other hand, U.S. trade with the Allies rose from $825 million in 1914 to $3.2 billion in 1916. The U.S. loaned huge amounts of money to the Allies so they could continue to purchase American goods. By April 1917, the U.S. had loaned more than $2 billion to the Allies.”

Indeed, if one reduces everything to economics, and all economics to numbers, there is nothing to see. But, in truth, economics is little relative to military matters.

Suppose that, at the Battle of Midway, the Japs had sunk the three American fleet carriers left in the Pacific, and had suffered no significant losses. Within a few weeks, the imperial Navy could have pounded Hawai’i, and then invade it. Instead of fighting in Guadalcanal, the Americans would have been reduced to harassing the Japs with their submarines. The war would have lasted years longer: American bombers and carriers would have to have been diverted to the Pacific theater from the war against the Nazis, etc. But then, the Me 262 would have been mass-produced, and the Nazi anti-aircraft rocket (Wasserfall) could have devastated Allied bombing fleets. And so on.

Without the help the American plutocrats provided the Kaiser in 1914-1916 (quite a bit of it psychological), the Second Reich may have had faced collapse much earlier than Fall 1918. The Kaiser’s ammunition crucially rested on American cotton!

Actually, let’s redo World War One for democracy: 1) The racist, anti-French Colonel House would not have proposed an anti-French alliance to the Kaiser on June 1, 1914.

2) Let’s suppose the Kaiser and his generals were nevertheless crazily murderous, and had declared war on Russia on August 1, 1914, followed immediately by an attack on France (impenetrable logic). Britain declared war to Germany on August 4, ostensibly for the German attack on Belgium. The entire Commonwealth followed in days. Supposed the USA had followed.

As happened, the French counter-attack, a month later, on the Marne, nearly destroyed the German army, which never recovered. The main architect of the war, Von Moltke, sank in a paralyzing depression (he had to be replaced secretly right away). If the German generals had been confronted by a declaration of war from the USA, they would have had to sue for peace, right away, instead of four years later.

Instead, the USA let the war goes on and on and on… Until it became clear, even to the German lethally insane imperial fascists, that the democratic, victimized Allies would win (in part because of the defection of Italy to the democratic side, in part because of successful war operations of France in the Balkans, in part because of the mass production of French 75 mm guns in the USA, in part because of the coming of French and British tank mass production, in part because of the imminent collapse of Austria-Hungary, etc.) Then the USA moved in force.

What for? Prevent the reshaping of Europe by the French. As it was, the French only effected a partial reshaping, the Versailles Treaty of 1919, hated to this day in the USA by all plutocrats and their minions.

***

Mitterrand and the Nazis Came to Understand the Preceding Confusedly:

The USA held back intervention in World War Two against the Nazis to even much more devastating effect than in World War One. The French contrived, somehow, to not die in massive numbers this time, but others did (non-consensually).

Ever since, France and Germany have worked towards an ever closer union. When Chancellor Kohl wanted to reunify Germany, Mitterrand offered his support… in exchange for the construction of the Euro. Unfortunately, the plutocrats instituted a charter which favored them twice, causing the present problems.

But that can be changed, and one can “sortir par le haut” (exit by the top, namely with higher level solution, higher both ethically, and in intelligence deployed). Exiting by the top means for France to find solutions with Germany. Tellingly enough, whereas plenty of borders have been closed, or partly closed, even between Germany and Austria, Germany and Denmark, France and Belgium, France and Italy, France and Spain, the border between France and Germany has stayed open.

Even more revealingly, the latest crazed Islamist attack in France (January 6) used a phone with a German chip, while the Jihadist, who had claimed to be Moroccan in a previous arrest, was actually Tunisian.

Morality? One needs empire for defense, and an empire needs a currency. It also need no borders inside (something Britain violated), while having the ability to defend its borders outside, not forgetting taxation to support social and military spending (taxation being something Britain violated, to its own profit, and is still violating, whereas Switzerland has surrendered, at least in principle).

Do you want peace in Europe? Swallow the European potion, breathe European air, extol the European spirit. And if you want to feel better: just contemplate the presidential candidates in the USA: except for the justifiably angry Bernie Sanders, they are a pretty dismal lot

Patrice Ayme’

Of Those Who Mind Minds

October 12, 2015

Polls show that two-thirds of Americans want taxes to be raised for taxpayers earning more than a million dollars a year. It’s not happening. Obama is pushing for the TPP, the Trans Pacific Treaty, which democratic presidential contenders oppose. All over, public opinion has been cornered into impotence: the public wants one thing, they tolerate the opposite. The public’s mind has been made into boiled pasta: easy to gobble, no backbone.

Angus Deaton just got the Nobel in economics. Here is an example of his prose: “There is a danger that the rapid growth of top incomes can become self-reinforcing through the political access that money can bring. Rules are set not in the public interest but in the interest of the rich, who use those rules to become yet richer and more influential… To worry about these consequences of extreme inequality has nothing to do with being envious of the rich and everything to do with the fear that rapidly growing top incomes are a threat to the wellbeing of everyone else.”

Where Does "Austerity" Comes From? The Richest Are Sucking Us Dry Through Debt Service

Where Does “Austerity” Comes From? The Richest Are Sucking Us Dry Through Debt Service

As I have explained for more than a decade, this is nothing new. This exponentiating growth in wealth, and thus power, for the few is how the Roman REPUBLIC was destroyed (and replaced by the despicable and stupid Roman plutocracy, aka “empire”).

The same phenomenon also happened when the Imperium Francorum (Empire of the Franks) went from the mild plutocracy known as the “Renovated Roman Empire” to the hard, abusive and demented plutocracy of the Late Middle Ages, “Renaissance”, and “Enlightenment”.

158 families, some of them not even bothering to reside in the USA, are busy buying themselves a president of the USA. Hey, why not? This has been working ever better for nearly half a century, ever since Mr. Nixon using public money to boost Mr. Kaiser’s health maintenance scheme (the President and the Kaiser: quite a program!). Say NYT’s Confessore, Cohen and Yourish, October 10, 2015:

“They are overwhelmingly white, rich, older and male, in a nation that is being remade by the young, by women, and by black and brown voters. Across a sprawling country, they reside in an archipelago of wealth, exclusive neighborhoods dotting a handful of cities and towns. And in an economy that has minted billionaires in a dizzying array of industries, most made their fortunes in just two: finance and energy.

Now they are deploying their vast wealth in the political arena, providing almost half of all the seed money raised to support Democratic and Republican presidential candidates. Just 158 families, along with companies they own or control, contributed $176 million in the first phase of the campaign, a New York Times investigation found. Not since before Watergate have so few people and businesses provided so much early money in a campaign, most of it through channels legalized by the Supreme Court’s Citizens United decision five years ago.”

Notice that the New York Times admits that the Supreme Court has “LEGALIZED” ways to channel the power of the few. Notice that Judicial power legislates. Notice that a new form of power has appeared: it’s expressed not just by the wealthiest, by a subclass of the wealthiest, a subclass which profited from the reorganization of the ultimate values of the USA:

“These donors’ fortunes reflect the shifting composition of the country’s economic elite. Relatively few work in the traditional ranks of corporate America, or hail from dynasties of inherited wealth. Most built their own businesses, parlaying talent and an appetite for risk into huge wealth: They founded hedge funds in New York, bought up undervalued oil leases in Texas, made blockbusters in Hollywood. More than a dozen of the elite donors were born outside the United States, immigrating from countries like Cuba, the old Soviet Union, Pakistan, India and Israel.”

Something the New York Times does not imagine is that these people became so rich precisely because they changed the laws first. An example is the entire financial industry, because of the dismantlement of the Banking Act of 1933 (Glass-Steagall). Hedge funds get money from banks and shadow banks, and that would not have happened before Clinton. If the New York Times does not understand it, those politically connected “donors” do, as the New York Times itself observe:

“But regardless of industry, the families investing the most in presidential politics overwhelmingly lean right, contributing tens of millions of dollars to support Republican candidates who have pledged to pare regulations; cut taxes on income, capital gains and inheritances; and shrink entitlement programs. While such measures would help protect their own wealth, the donors describe their embrace of them more broadly, as the surest means of promoting economic growth ….”

Obama went to a hall in Los Angeles. It cost only $33,400, per person, to be there. A fracking family (family making money from fracking), gave $15 million to a particular Republican candidate. Another family, which made a fortune from a hedge fund, gave eleven million dollars. And so on. Even French TV is taking note, and discovers “it’s a threat to us all“. What? No appreciation for a short and brutish life as in the Middle Ages, serving great lords of finance and drinking fossil fuel water?The New York Times admits wealth prevents democratic expression. Actually the paper seems to be a bit confused between the notion of “democracy” and “demography”:

“In marshaling their financial resources chiefly behind Republican candidates, the donors are also serving as a kind of financial check on demographic forces that have been nudging the electorate toward support for the Democratic Party and its economic policies. Two-thirds of Americans support higher taxes on those earning $1 million or more a year, according to a June New York Times/CBS News poll, while six in 10 favor more government intervention to reduce the gap between the rich and the poor. According to the Pew Research Center, nearly seven in 10 favor preserving Social Security and Medicare benefits as they are.

Republican candidates have struggled to improve their standing with Hispanic voters, women and African-Americans. But as the campaign unfolds, Republicans are far outpacing Democrats in exploiting the world of “super PACs,” which, unlike candidates’ own campaigns, can raise unlimited sums from any donor

What does the concentration of wealth at the top do? Mostly shape minds in a way which serves the top guys.

The degree of manipulation of opinion is astounding, and obviously deliberate. (Media are mostly owned by plutocrats: so it’s no surprise!) One could call it a science. A technique is to write an article relating scientific, or sociological facts, say about global melting of ice, or medical care, or guns, and then allowing only commentary derisive of the article. (The Daily Mail in the UK apparently does this to a particularly obvious extent, I observe.)

Another technique is to (implicitly) present banks, and the money-changers as the savior of humanity (the New York Times’ Krugman does this), while not talking about Too-Big-To-Fail banks, Shadow Banking, or the dark connections between banking, derivatives, and politicians.

Angus Deaton, the Nobelist from Princeton University, has looked at the Dark Side: he observed that a lot of financial help to poor countries backfires, as it makes more sustainable for governments to mismanage the society and economy they rule. So the problem with development is more governance (what I call “empire”) than anything else.

Governance is failing worldwide, and this explains why 80 plutocrats are richer than the rest of the world combined.

New Middle Ages Rising

New Middle Ages Rising

The recipient of the “Prize of the Bank of Sweden in Economic Science” is a harsh critic of economic aid from rich countries, like the United States of America, to poor countries. “I have come to believe that most external aid is doing more harm than good,” he wrote in his 2013 book, “The Great Escape.” “If it is undermining countries’ chance to grow—as I believe it is—there is no argument for continuing it on the grounds that ‘we must do something.’ The something that we should do is stop.” The Scottish born Deaton, indeed, is not afraid of controversy: he questions the widespread presumption that rising inequality is always a bad thing.

In other words, Deaton dares to say aloud that the hysterical pursuit of wealth may be good for economic activity. But Deaton claims to have found evidence that wealth brings happiness… until an income of $75,000 income. After which it starts to backfire.

Patrice Ayme’

Wisdom Not An Itch, But Economy Hitching Dark Side, A Gangrene

September 13, 2015

Is Philosophy Just An Itch? Far from it. Even if it were, as Wittgenstein had it:

“Philosophy hasn’t made any progress? – If somebody scratches the spot where he has an itch, do we have to see some progress? Isn’t genuine scratching otherwise, or genuine itching? And can’t this reaction to an irritation continue in the same way for a long time before a cure for the itching is discovered?”

It is not true that philosophy asks always only the same questions, and it is not true that philosophy has not progressed in 3,000 years.

Instead the opposite is true. contemporary with Socrates was Xenophon, who named and defined “Economics”. Xenophon was student and friend to Socrates, a writer, historian, soldier, general, and retired as a horse breeder.

Krugman Is A Philosopher, He Rules World. But Who Pulls His Strings?

Krugman Is A Philosopher, He Rules World. But Who Pulls His Strings?

[Paul Krugman, appropriately surrounded by the Dark Sides.]

Paul Krugman is one of the world’s most respected – and most feared – economists of our time. Illustration by David Simmonds.” –Handelsblatt which adds: “Many think the U.S. Nobel Prize winner is the most influential economist of our time and a leading voice on the left. But many of his major ideas are controversial. And rightly so.”

Those familiar with my disagreements with Krugman know that we differ philosophically. Our differences are mostly about finance, banking… And especially believing that, if only bankers had even more money, through Quantitative Easing, the world would become richer, fairer, and more comfortable. That is anathema to me, for many reasons, including the fact I do not trust too much power in too few hands, whatever the reasons evoked, or even if one calls these people, bankers, and Obama admires them very much.

Philosophy named and defined much progress.

Behind all and any empire is an economic organization backed up by a philosophy. Darius, founder of the Achaemenid Persian empire, changed economic organizations very quickly, according to circumstances, , from military to command and control, to building the world’s first fast road system, to libertarian capitalism.

It is possible to argue that the Greco-Roman empire failed, because it failed PHILOSOPHICALLY. Namely, its philosophy failed. It failed because the (Macedonian) military leaders got imprinted on the erroneous, despicable, and lethal philosophy of their friend Aristotle, itself all too inspired by Plato, Socrates, and other golden youth, or their fellow travellers.

One can view the Middle Ages greatly as a struggle against much of Aristotelian philosophy: not just against Aristotle’s physics, which was egregiously wrong, but also against his Ethics and his, related, preferred theory of government. Aristotle embraced dictatorship, also known as monarchy, hence theocracy.

In Socrates’ times, democratic institutions were, in many ways, brutally primitive and inappropriate for sustaining the Athenian Republic. These brought not just the death of Socrates, but were decisive to bring the defeat of Athens in the Peloponnesian war (which nearly brought the annihilation of Athens, and certainly an eclipse of democracy for more than 2,000 years). The People’s Assembly had decided to massacre entire populations (Melos), and brought hatred against Athens.

Much of Socrates’ work was about improving the Athenian democracy, and many of the philosopher’s critiques were addressed during the Middle Ages, by inventing new institutions.

So there has been progress in philosophy, and also considerable social and political progress in implementing progress in wisdom.

We need more. Behind Krugman’s vision of the world, lays a benign, naive trust in human beings benevolence. At least, that’s the excuse.

Friends, Not To Say Lovers Of The Same Values. How Far Are We?

Friends, Not To Say Lovers Of The Same Values. How Far Are We?

Instead, I go further than “French Theory“. French Theory, generalizing Nietzsche’s approach, is suspicious of all and any institutions. I propose to remember what the Marquis De Sade implicitly proposed: those who take, those who are entitled, those end up being able to take decisions on behalf of the many, are, intrinsically, moved by the Darkest Side. Even if they did not start this way, the stress they are subjected to, insures that they end up that way.

Yes, Krugman is a philosopher, in the sense that his work, and advice, and popularity among, thus, power on, the mighty, depends upon his philosophical positions. Yet philosophers to the Dark Side, by their very presence where they are, embrace it.

This is not all just words. I love and respect Paul Krugman. in some ways. However, contemplate this: “Enron, a notorious corporation which conspired in organizing energy shortages in California, later to collapse in scandal and bankruptcy, employed Krugman. Paul’s fee? $37,000 for three days work. It provoked outrage. Wasn’t this excessive?. Mr. Krugman used his column to respond: not at all, he wrote. At the time his fee for a one-hour talk was $20,000. Enron got a deal.”

And the worst? Paul Krugman is very small fry, in the plutocratic world, as far as income is concerned. Donald Trump recently pointed out he “knew hedge fund managers. They pay no tax.” And some of those earn billions. General Electric got (60) billion dollars from the Obama administration, paid no tax for years, and then proceed to buy its French competitor, Alstom. Even the European Commission found that not kosher (although the plausibly secretly compensated by huff and fluff ,French government had approved).

Krugman at some point proclaimed himself the “lonely voice of truth in a sea of corruption”. The worst? It’s true. Because Krugman had dared to say the Obama administration was soft on punishing Wall Street after the 2008 corruption affair (the so-called “crash”), he was not invited to participate in said administration of the useless and redundant (as plutocrats connected to the so-called “Deep State” take all the decisions).

Handelsblatt: “Somehow Mr. Krugman’s fury keeps on growing. The source of this anger may be the man’s greatest enigma, since in fact worldwide there has never been as much Keynesian intervention as there is today…”

The answer to this, Handelsblatt, is simple: the crisis is getting ever worse. To the point the spectrum of war is rising. Even the Pope, noticed this.

Handelsblatt: “Since the crisis began, the largest central banks have flooded the world economy with liquidity, and brought their base rates close to zero. The governments of the industrialized world, with the exception of Germany, are still running huge budget deficits. They have put together enormous rescue packages, partly to rescue the banks, partly to bail out bankrupt states, partly to invest in infrastructure.”

Well, and this is my main difference with Krugman, rescue packages were all about the (“PRIVATE”) banks, and they bankrupt(ed) the states. To correct this, the entire banking system needs to be completely overhauled. In first approximation, the spirit of the reforms of president Roosevelt, ought to be re-introduced.

In Great Britain Jeremy Corbin, an anti-dictatorial (anti-monarchist) was elected to head Labor. Tony Blair, one of the world’s most corrupt politicians, ever (Bliar gets money from various dictator, including that of Kazakhstan) suggested that: “those who say their hearts are with leftwinger Jeremy Corbyn should ‘get a transplant’.

Darius, like the Incas, like Diocletian’s Rome, or the Tang in China, or the empire of the Franks (which mutated into the “West”), or Themistocles Athens, let alone Stalin’s USSR, or today’s China, let alone the mercantilist USA, show that the primary actor, and author, of the economy is not the little capitalist, but the massive state. Handelsblatt claims not to understand this, and calls Krugman a fool.

However, the USA’s government institution revealingly known as the “Fed”, created more than 13 trillions (yes, that’s a t: trillion) dollars of money to inject in the economy, and the European Union, less than two trillion. And yes, that’s a problem: too much money chasing too few investment possibilities. So what ought government to do? Create more investment possibilities. Titanic investment program. As Darius did with his Royal road network. Now the Royal Road ought to lead to Mars. And the Quantum Computer. And Thermonuclear Fusion. And the Space Elevator. And a research program to fight aging (a major economic, not just military problem). Those who don’t want progress get regress, not to say egress.

Imagination, ladies and gentlemen, is more important than austerity, and not just in economics.

Patrice Ayme’

Bank Worship

May 20, 2015

BANK WORSHIP IS ALL WHAT MIGHTY ECONOMISTS KNOW:

I have fiercely condemned, for a decade, the policy of reducing the economy to interest rates. As I have said, and will say again below, this is identical to making (private) bankers into gods. “Liberal” (meaning “left” in the USA) economists love to say that low interest rates is all the socialism we need. Nobel laureate Paul Krugman is trying to make fun of the serious arguments found in scholarly critique of his “interest rate idolatry”. Says Paul:

I’m With Stupid.

No doubt, dear Paul, no doubt. Being stupid is more profitable, quite often, than being smart and moral.

Banksters Steal The World, And Prosper, Ever More

Banksters Steal The World, And Prosper, Ever More

Via FT Alphaville, James Montier has an interesting piece castigating economists for their “interest rate idolatry”, their belief that central bank-set interest rates matter a lot for the economy…” Montier writes down notions I used to brandish at the beginning of the Obama presidency. I stopped after I realized everybody (Very Serious People, Academia, High Finance, Politicians, Media) was on the con. That meant, in practice that, if one talked about it too much one was viewed as mentally imbalanced (just as pointing out that the Qur’an prescribes terrorism may one looks as a racist, according to the Politically Correct insects). Here is part of Montier’s well-thought essay:

A wider idolatry: the greatest con ever perpetuated

Lest you think I am being unduly harsh on the world’s poor central bankers, let me turn to the wider idolatry of interest rates that seems to characterise the world in which we live. There seems to be a perception that central bankers are gods (or at the very least minor deities in some twisted economic pantheon). Coupled with this deification of central bankers is a faith that interest rates are a panacea.

Whatever the problem, interest rates can solve it. Inflation too high, simply raise interest rates. Economy too weak, then lower interest rates. A bubble bursts, then slash interest rates, etc., etc. John Kenneth Galbraith poetically described this belief as “…our most prestigious form of fraud, our most elegant escape from reality… The difficulty is that this highly plausible, wholly agreeable process exists only in well-established economic belief and not in real life.”

This obsession with interest rates as a cure-all rests on some dubious views about the way the world works.”

Montier points out that the fundamental official argument for lowering interest rates down to zero is flawed: …”firms generally rely on internal financing to fund investment, rather than borrowing – witness Exhibit 6. Over 100% of gross investment is financed by internal funds.”

The obsession with interest rates has meant, in practice, that so-called liberal, self-described “progressive”, friends of “We The People” economists, have prescribed, implicitly, to lower taxes on the hyper-rich as much as possible. So they masquerade as left-wing, but, in truth, they are plutophiles. This is an old method, and why Polar Bears are white, instead of brown or black as their ancestors were. Montier:

“Just in case you were wondering about the much-lauded ability of the central bank to create inflation via helicopter drops of cash (or its modern-day equivalent), this is actually a form of fiscal policy, not monetary policy. As I noted above, monetary policy alters the distribution of net worth while fiscal policy alters the levels of net worth. Because helicopter drops effectively give everyone a boost of cash, this is clearly a change in net worth and thus is likely to be helpful in stimulating demand.

As you may have gathered from the preceding paragraph, the good news is that there is an alternative to monetary policy, and that is fiscal policy. These days fiscal policy is deeply out of vogue amongst policymakers and politicians. However, it has a much more direct link to growth than any of the channels suggested for monetary policy – it is part of the construction of GDP, and has a clear impact upon incomes.”

Krugman made a very feeble defense, which mostly consisted, weirdly, but tellingly enough, to laud Lawrence Summers, one of the architect of the dismantlement of the financial regulations under Clinton, to create a class of hyper-rich financiers. To his credit, Krugman published my comment:

In the USA, houses are started massively all the times. It’s a mark of unsustainability (presumably flimsy housing is replaced). Reducing the entire economy to this, is imbalanced. Why not consider infrastructure starts? Research? Health?

The fundamental question is: what is an economic activity which is profitable for the society?

The conventional answer is that banks know best. As the banks’ lending goes up as interest rates go down, bringing the latter down, improves the economy, say banks’ friends.

Let’s call that BANK WORSHIP.

Bank worship has enabled big banks’ heads and associated high financiers they collaborate with, to be so powerful and dishonest, that they changed the hearts & minds of all the power that be in society.

The latest case is the French Societe Generale: the police chief in charge of an inquiry on an eight billion dollar fraud therein, now admits, years later, that she was manipulated by the bank (a lower level employee, Jerome Kerviel, was sued, chased down, and condemned severely, although he claims he acted under orders). The fraud was reimbursed by taxpayers. This means that Societe Generale bosses, just in this particular case, of this particular fraud, stole around 50 dollars to each French citizens. Don’t worry for them: the thieves live big. An even bigger picture is that, in the leading countries, big bankers are banksters, and they corrupted institutions of the Republic (including politics, government, justice and police) thoroughly.

The problem is the same in Anglo-America: time after time, giant frauds of the biggest banks are exposed, and they are condemned to fines. In the end, a bank-too-big-to-fail condemned to a fine means nothing: in the worst possible cases, it’s tax payers who pay. It is the case where the criminals’ punishment is to make the victims suffer.

The latest such case is the LIBOR “punishment”, proclaimed today. In it, big banks in London manipulated the world’s leading interest rate (they call that the “market”). You would think that, after stealing billions the heads of banks such as JP Morgan would go to jail. No. Taxpayers go to jail.

Zero Interest Rates, To Serve High Finance Plutocracy:

Another problem is that zero interest rates have proven devastating for small savers, while providing the banks and their accomplices with quasi-unlimited funds for playing with each other the derivatives’ market, something that is not a real economic activity, except by making the richest ever richer.

One lends to the rich. By making lending ever easier, government policy has made the rich ever richer.

Correct economic activity would consist in the government encouraging activities which are profitable to the people at large, very long term.

The “market” is driven with what bankers think is profitable, short term.

Conventional wisdom by the economists in power is that we can trust the bankers to encourage the economic activity most suitable to the “market”, hence society.

Governments were told by the economists in power to make the job of bankers easier, to make for a better economy, hence better society. Trust bankers, give them all the lending capability, hence all the power they want, and We The People will become richer.

Thus the general strategy of bank worship assumes a trait that is true: a banker is a government official. A banker is a non-elected, uncontrolled government official, with unlimited funds, and inexistent oversight by the People’s representatives.

Bankers control the market, which controls the economy, which control society. Is that the society we want? Do we want to be controlled, financed, by an oligarchy of non-elected little Big Brothers who decide what activities the society will engage in?

Bankers are little Big Brothers who are free to finance the high financial class they belong to, as much as they want. That’s why derivative trading is more than ten times larger than real trade, worldwide. This is also why half of the world’s money is in Dark Pools. And so on.

The cause of this nightmarish world is bank worship. Bank worship is very smart for the Big Bankers. Krugman is NOT with stupid, as he disingenuously claim. He is with the winning crowd. To go interact with people such as Paul Krugman and Joe Stiglitz, the fact is, one needs to be seriously independently wealthy (then one can become a “student”, meaning a future co-conspirator, or mingle at parties).

It is very stupid for the rest of us to have become adulators of bank worship. Bank worship made society subject to a dictatorial oligarchy operating in the shadows.

What happened to the Enlightenment? It seems to have sunk in “Dark Pools”.

Patrice Ayme’

Essence Of The Economic Crisis

April 7, 2015

In 2008, a financial crisis blossomed. It was caused by the rich, those who control the world. Some of the rich lost considerable amounts of money, mostly to other wealthy people and institutions (who had thus become even richer). So doing, the world financial system got destabilized: bankruptcies could propagate.

The most obvious way out was to recover as much money as possible from the rich. Instead, something else was decided, by the powers that be (themselves electorally financed by those who had set-up the system that crashed, and many of them had profited from).

Since 2007, The 1% Have Gone Off The Charts, Leveraging Crisis, Through Obama

Since 2007, The 1% Have Gone Off The Charts, Leveraging Crisis, Through Obama

To resolve optimally the near-destruction of the financial system in 2008, it was decided to make We the People pay. Saving the richest individuals and institutions was objective number one. So little savers saw their saving rates go down to zero. Workers, even productive workers, such as researchers in fundamental science saw financing go down drastically. Projects went unfinanced, researchers had to quit research. This happened in Great Britain, among nearly all other developed countries (Switzerland being an exception).

Thus “Austerity” is just about We The People going starving, in all sorts of ways and dimensions. Meanwhile, the richest people and institutions in the world kept paying no, or very little, taxes.

Google in Britain made billions, and paid very little tax (a “Google Tax” is supposed to come in, the Conservatives grandly declared, a few months before the elections). Hyper wealthy Brits claim to reside overseas, and thus pay very little tax, and it is perfectly legal.

All over we see the same problem. So question: why do not the richest people and institutions, those with the greatest means, who need very little of what they have, be the first to experience austerity?

Distributing their riches would augments economic activity overall.

Conversely, not distributing the riches of the hyper rich diminishes overall economic activity.

The graph above clearly shows that this entirely a political problem. Policies (at least in the USA) were not friendly to the hyper wealthy, after the crash of 1929-1930. During, and after the war, the USA was managed in a way that was, relatively speaking, socialist.

Reagan though surfed a wave of resentment by the wealthy that originated in California with Prop.13 (and Reagan’s election as governor, and Nixon as president, earlier than that).

So here we are. A few hands take all the decisions, and they are most happy, the more they can grab in money and power.

Larry Fink CEO of the fund company Blackrock (managing more than 4 billion dollars in investments) warned companies that they are demolishing societies by redistributing too much wealth to the wealthy, at the expense of everything else.

Carl Icahn, a plutocrat worth 24 billion dollars, hearing of Fink’s critique, agreed, and lashed out at the CEO class: …”What is even more dangerous and concerning is that so many of our companies do not have CEO’s that have the ability to make investments, let alone run the companies they are now charged with…”

It is even criminal: the hyper rich, and the CEO’s class serving it, are actually not just destroying the world’s socio-economy, but threatening the survivability of the biosphere (the CO2 crisis is a case in point: a handful of plutocrats, fully using their enormous powers, have poisoned world public opinion, and decision making; so we are adding 2% of the total content of CO2 in the atmosphere, every year, half going in the ocean. That was entirely avoidable).

Most very wealthy people are not amused by Fink’s and Icahn’s opinion. They would rather deny there is a problem, they will point out that we live in the best possible world, so far.

So did the passengers of the Titanic, enjoying the most luxurious, fastest trip ever, on a perfectly unsinkable ship.

Reality can be a most ominous fate. Even for plutocrats.

Patrice Ayme’