Posts Tagged ‘Romney’

Ideas For Democrats

October 17, 2012

So here we are. Romney has a plan, in five points. Obama says Romney’s plan is just one point: the rich should play with different rules. But what’s Obama’s plan? What is Obama’s point? Nothing. Except more of the same. And the same does not work.

The democrats have zero new ideas. After he was elected president, Obama spent two years on his knees, begging republicans to change tone. Apparently he was elected president to beg for love: Obama did not need republicans, in the first few months, as he enjoyed a supermajority. [See note.] Did he want to do nothing more than Bush, in the hope he would be rewarded, like Clinton (or Major, or Blair, or Sarkozy)? Giving six figure speeches to the powers that be.

I long pointed out that the economy is worse than in the 1930s, in some dimensions. Not too many celebrities point that out on the left: their power & wealth depend upon the present corrupt intellectual scheme.  I want to meditate this graph:

French & German Private Companies Research & Development.

A consequence is this graph:

German Industrial Production Is Higher Than Ever. Because Research and Development in German private companies is higher than ever.

Why to brandish France and Germany in the context of the election in the USA? The European Union is an excellent place to test policies. What we see above is that Germany did something right, and France the exact same thing, wrong. With dramatic consequences (jobs are disappearing by the thousands in France every day it seems). Something resembling what’s done in Germany is basically the only solution for the West. And that’s real progressivism.

Germany is doing great economically. Germany has an unemployment rate of 5.5% although she accepted no less than one million new Eurozone residents, who came to work, in the last year alone. A spectacular way to solve the… German problem… Now something more about a dying birthrate.

Many leaders, political, academic or intellectual, on the left are more corrupt than on the right, because their minds are twisted. They are not what they seem. They are the opposite of what they claim. Those pseudo leftists are plutocrats, or next to plutocrats, or serving plutocrats… while claiming to serve the People. At least the Koch brothers, when they do their machinations, are really trying to influence public opinion the way one expects them to.

Whereas plutocrats such as (chief of the democrats in Congress) Nancy Pelosi (personal worth perhaps as great as Romney, about 200 million dollars), or (Senior Senator) Dianne Feinstein (personal worth up to twice Romney) claim to care about the plebs… Which is fine. However their historical record is that they did nothing when they controlled Congress, except for extending Bush’s tax cuts, Bush’s wars, and an ObamaCare who looks (to me) more like BuffetCare than anything else (Buffet is a notorious investor in HMOs and the like). So they are not what they seem.

Many of the critiques Romney has been making, I have been making over the years, to wit:

1) the lowering of the median family income by more than $4,300 (roughly 10%, in constant dollars). This is actually (one of) the main argument I historically made to qualify the present slump as the “Greater Depression”. (There are other arguments, now reinforcing, such as the decrease of life expectancy.) 

2) that health care costs are out of control. Romney said they increased by more than $2,000 under Obama, and independent evaluators have forecast a proximal augmentation of the average family health insurance bill by as much as ObamaCare kicks in fully by 2014.

To put health care under control the only way is to make the basic plan public (as this takes the profit motive out of the cost of rendering care to the otherwise moribund). OK, Obama could push for that later.

3) the lack of jobs. Romney say he will get tougher with China, for currency manipulation (Obama already did this quite a bit), and Intellectual Property theft. IP theft is the big one. The West has been like a baby while the Chinese Communist Party and its plutocratic agents have been stealing IP right and left to the West.

The democrats have no plan, but Romney came up with one: take out all the deductions, beyond $25,000 total, do not tax capital gains below $200,000. And of course, reduce taxes all across the board, except, overall, for the top 5%.

How come the democrats do not have a plan? OK, tax the rich mandatorily 30%. That’s their would be plan. Good luck forcing Pelosi and Feinstein to pay 30% tax. The average Congress person and senator is a high multimilionaire, I do not see them taxing themselves. Moreover, taxes do not mean jobs, as Constantinople demonstrated for a millennium.

The same critique can be made to, say, the French Socialists. There the proposed tax is 75%. But entrepreneurs in France revolted, and used exactly the same argument as Romney: small companies create jobs, a lot of the pseudo millionaires actually re-invest massively in their companies, creating employment. A really progressive agenda has to take this into account. Bitten by critique that way, the French Socialists accepted that Romney/Silicon Valley argument, and operated a strategic retreat. And now they are sitting on their haunches, thinking harder and deeper… (Notice that the Socialists are in total control of France: Presidency, Senate, Parliament, most large cities and regions; what they have is an intellectual, not political problem.)

This argument, that multi-millionaire entrepreneurs create jobs, is correct, and close to the heart of Germany’s economic success. I would argue that small entrepreneurs should be taxed ZERO on the portion of the money they make that they reinvest in R&D.

German entrepreneur-owners in the Mittlestand (Middle Stand) re-invest massively in their companies. OK, they are tough with their employees, but is it better to have a sadistic boss rather than having no income whatsoever? OK, it depends how sadistic, it’s all about 50 Shades Of Grey (Feldgrau in this case…).

Thus it would be good for USA democrats and French Socialists to have a system similar to that Angela Merkel presides over. The Mittelstand invests massively in research and development.

In 2011, Germany obtained three times more patents than France (which has 83% of the population of Germany). Here are the numbers from 2008:

Rank Country No. of Patents Granted
1  Japan 239,338
2  United States 146,871
3  South Korea 79,652
4  Germany 53,752
5  China 48,814
6  France 25,535
7  Russia 22,870
8  Italy 12,789
9  United Kingdom 12,162
10  Switzerland 11,291
11  Netherlands 11,103
12  Canada 8,188
13  Sweden 7,453
14  Finland 4,675
15  Australia 4,386
16  Spain 3,636
17  Belgium 2,948
18  Israel 2,665
19  Denmark 2,347
20  Austria 2,306

The classification is very different for patents in force, and for applications. Comparing all, it seems some countries, presently in economic difficulty are seeing their patent position decay quickly. Digging a bit deeper, one can see that research and development led by private companies has exploded in Germany, while it has decayed in France.

The bottom line is this: people in the developing world earn at most 5% of what they would earn, with the same job, in the developed countries. Reciprocally this means that most employees, in developed countries, are paid twenty, and often thirty times too much, or at least would be if the communications were free.

The way out is for developed countries to develop jobs that cannot be replaced at a distance. Except for low lives’ jobs, such as pushing carts around and shining shoes in airport, this means jobs depending upon knowledge most countries cannot endow their citizens with. Firms with a persistent R&D strategy outperform those with an irregular or no R&D investment.

European Countries With Higher R&D Do Much Better

So, to provide with employment, developed societies should be oriented towards research, to develop further. The target should not be 3%, but 10% of GDP. A good way to do this would be to make all research and development go tax free. $6.6 billion of research tax credit has been claimed recently in the USA, a very small fraction of the total R&D, so there is a lot of room to spur research using taxation!

It goes without saying that forcing the banks away from derivatives, and back into the real economy would help. One can easily argue that three quarter of world finance is actually a criminal organization. How? Simple: the world used to work with 8% of corporate profits in finance. Now it’s 40%. Those 32%, one third of world profits, can only be explained as parasitism of some sort.

So let the left talk about these things. That would be more constructive than the specious arguments Obama used in the debate to mark points with the silly ones [See note]. If Obama is elected without an effective plan, the situation is pretty sure to disintegrate further, and when things get too desperate, the fascist instinct always gets in gear.

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Patrice Ayme

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Note on Obama’s specious arguments: the 47%. And the Benghazi fiasco. Obama said he used the word “terror” the next day. But I thoroughly documented that the White House administration prepared declarations at the time accused those who “denigrated Islam”, not a deliberate Salafist attack by a commando (which is what really happened). Instead a video describing the Qur’an according to itself (!), and a French magazine with two silly drawings (one representing a Jew and a Muslim, and the other that I reproduced). I would actually suggest that Clinton sacrifice herself, and resign. Time to man up. After all, there was a massive Salafist base next door (since then destroyed by inhabitants of Benghazi in retaliation for the attack on the Consulate of the USA).

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Note on supermajority: I sent a comment on the Krugman New York Times editorial (another freaky attack accusing Romney to have lied about what he did in next year). I pointed out Obama did nothing when he could have done everything. exceptionally, the NYT published it, jointly with a reply that I was deluded because Obama had a super majority of 60 in the Senate for only 14 weeks (as the rest of the time, the reply argued, poor Ted Kennedy was idiotically “housebound“, meaning Teddy, a specialist of swimming against the current, preferred to help the republicans by eating pancakes at home, rather than facing his destiny, and resigning).

That was doubly idiotic: first of all, the democrats controlled Congress for four years, during which, they did preciously nothing. Secondly, even if it’s all the fault of poor rich Teddy boy eating pancakes at home, 14 weeks is a long time. In less than 14 weeks, the French Socialist government has passed an enormous amount of legislation, including a European financial rescue mechanism, an FDIC for Europe (that required sorting things out with 26 other Congresses!), a 75% tax on income, a financial transaction tax, and the French Socialists passed countless other laws.

Face it guys: Obama hid behind Oblahblah, also known as George W. Bush III… And plutocrat Pelosi, his prophet.

So the New York Times published my comment which mentioned just in passing “supermajority”, joined with a reply already “approved” by 108 people (!) In other words, a lot of money is deployed to cheaply twist reality. How could have these people read by stuff, reply to it, and have 108 people read the reply, and approve it? All in one nanosecond?

Banking Demons.

May 21, 2012

MONEY CREATION BY THUGS = CIVILIZATIONAL COLLAPSE.

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 People of more than zero influence are waking up to the fact that they have to admit that there is something  wrong with the banking system as it is. A delicate task: something has to be revealed, but not so much that the pyramid upon which the wealthy rest, would crumble.

 Paul Krugman, long extremely partial to private banks, wrote an editorial in the New York Times on the subject of how outrageous banking, as presently practiced, is. Krugman could have written this years ago. But he did not. Instead he waited until the plutocratic party went one outrage too far.

 In Dimon’s Déjà Vu Debacle, Krugman focuses on the fact that the state insures the banksters. Of course the state does much more: it reassures the banksters, thus encouraging them in their crimes. But not just that. The state gives trillions to banks so that they can play with each other. Krugman will not tell you that. For years he has been pushing stridently for Quantitative Easing, giving trillions to banks, no strings attached.

 Same idea as Reaganism, or Sarkozism: give to the rich, so that the rich will give to you.

 The bank JP Morgan Chase lost 3 billion, or maybe 5, or 100 billion. No problem, says Romney: it’s not their money, it’s theirs! If it’s not to some banks, that money, it’s to some other guys. Guys like me, guys, say romney, and he beams with pride.

 In truth, though, that money is neither to the banks, nor to those other guys. That money is yours. Private banks are in charge of creating public money, in guise of private credit.

 Some will say: this is how capitalism works. No, that’s how a particular form of fractional reserve based financial parasitism works. Proof: the Nineteenth and Twentieth century revolutionaries (Marx, etc.) did not talk about it. Instead they mostly talked about the abuse of workers by great capital. (Now there are not even workers to abuse…) At most Marx complained a bit about the monopoly of banks. The scam existed already at the time, but it was discrete.

 Romney lauded the plutocratic doctrine in relation with JP Morgan’s loss. Milder partisan of the established order, such as many in the democratic party, feel that Romney is going too far. More importantly, he wants to take their place. So, to their regret, they have to mention a bit of what’s wrong with banks.

 Romney said that JP Morgan’s loss was excellent, because it benefited somebody else, namely an evil plutocrat laughing all the way to his private jet. Romney conveniently forgot to mention that, ultimately, it’s the taxpayer who foot the banks’ bill (as Krugman finally points out, when, as I already said, he could have done it years ago). Romney is pedagogical.

 Extolling the theft of taxpayer money by hedge funds may look like a blunder on Romney’s part, but of course it’s not. Romney and his operators are clever, they know what they are doing. What they are doing is to prepare the minds to finding this sort of reflections part of the natural order of things. Instead of a blunder on Romney’s part, it’s an attempt to have all Americans become friendly to the notion of rising, shining, and boasting in the glory of that evil plutocracy is best to bring a better world.

 In other words, Romney is not just running for himself, but also, deliberately, on the behalf of plutocracy. It looks clumsy, but it’s crafty, and manipulative at the emotional, “subconscious” level.

 I immediately sent (a version) of the following comment, which put the problem in a wider context, to the New York Times (a context readers of this site will be familiar with). It should have appeared among the very first comments, thus influencing thousand of readers, and endangering the established order. Instead something happened, and it was published in # 195 position (!) Typical treatment given to my comments, when they are too clever by half.

 “It is of foremost importance for the plutocratic order that the following is not understood by the masses. What Romney and the class he campaigns for do not want the simple minds of the People to comprehend, is that BANKS ARE ACTUALLY PUBLIC INSTITUTIONS.

 OK, if a number of individuals put money together, and then lent it, that, and only that, would be a true private bank. Instead what is happening is that banks, especially very large banks, lend much more capital than they truly possess. They can do that, thanks to the full complicity of the government, which, then, in turn, become their accomplice and creature.

 Such is the nature of the Fractional Reserve Banking System. Banks, using leverage, something only possible with the backing of the state, create all the credit, and therefore, most of the money. Money creation, a basic public function, has been farmed out to private individuals.

 Just as tax collecting was farmed out to “general farmers” under (some of) France’s Ancient Regime, and (some of) the Roman empire. However, in France and Rome, money creation stayed an exclusive activity of the state.

 So let me rephrase it: instead of calling banks private, one should realize that any bank using leverage is a public institution. It’s a fact, not an opinion. It’s a crucial fact. That is why, on his first day in office, president Roosevelt could, and did, close all banks in the USA.

 Insisting that banks are private is like insisting that public money making is private, a monopoly the state give to unsupervised, unelected individuals.

 That public character of leveraged banks makes all bankers, including Mr. Dimon, head of JP Morgan, and loudly admired by Obama, into public servants. As they lend to their friends (in finance, or their collaborators in their class (hedge fund managers who use leverage, as they all do), that makes those bankers and the banking they do, fundamentally corrupt.

 When banking executives pay themselves immense amount of money, they do so with public money. The head of the unit of JP Morgan which was playing with derivatives, Ina Drew, a blue eyed blonde, earned more than 31 million dollar in 2010-2011 alone. (She has now been fired to the regret of Dimon, who did not want to fire his “sister“… Said the New York Times.)

 This nature of banking, the exploitation of the public sphere, by a few self selected private individuals, has grave implications on Quantitative Easing and the like. The USA’s central bank gave (or lent at such low rates, it was like giving) trillions of dollars to the very banks and managements which caused the 2008 financial crisis (example: Goldman Sachs). It was quite a bit like paying off the mobsters who just burned your house. Payments are ongoing, and explain why the likes of Dimon fill Obama’s mind with awe.

 In Europe, the central bank lends at 1% to banks which then lend that exact same money to the states at 6% or 7% (Spain, Italy) or well above 50% (Greece). In other words, the public finances the plutocrats rather than the real economy.

 Merkel then barks, and push to cut off funding for public transportation in Greece, so common people cannot go to work anymore, but can, instead, be accused of laziness (feeder trains from suburbia into Athens have been often stopped, and the tracks overgrown with weeds. Meanwhile Merkel sells Porsches to her friendly plutocrats in Greece). Why does she do all that? Because she is protecting the leveraged banks by shifting blame to the common Greeks.

 (Not that the Greeks were blameless: tax avoidance was a tradition in Greece, something that forced the country to live on credit more than could be sustained.)

 The fundamental nature of the present crisis is the rise of plutocracy, naturally accompanied, as it always is, by the crushing of democracy (see all students having to pay colossal tuitions, so that only the children of the hyper rich can study, just like in the middle Ages; and if you protest, the Quebec government will come to arrest you, so please, approve!)

 The present “fixes” only make the situation worse. (As was demonstrated, say in Greece!) Those “fixes”  consist into shuffling ever more money to banks which then lend that money to their friends, or then to states at usurious rates, while augmenting stratospherically the public debt to said banks. This only augments the power of banks, hence of the financial plutocracy, and thus the crisis.

 Is it deliberate? Probably. I have mentioned it on Krugman’s blog for years, but Krugman, who is very intelligent does as if he did not notice. Why? because if he did, he knows he would sitting in the hot, ejection seat. So he bids his time while munching on caviar, and sipping champagne.

 The only way out is a general default, as advocated in:

 https://patriceayme.wordpress.com/2011/09/14/to-save-the-world-please-default/

 Radical, sure. We have to grab the problem by its roots. Otherwise, we face collapse of civil society, while drowning and boiling.

 Accompanied by a stiff regulation of banking, along the lines of president Roosevelt in 1933. Instead the Roosevelt laws were dismantled under president Clinton, a greedy critter, well rewarded since.

  A few little men of modest extraction, get absolute power, and they want to keep some thereafter. That echo of power is provided by the Lords of Finance. As long as they took the right decisions. Singing hypocritically with U2 lead singer, the so called Bono (not his real name, just a bon mot to make him sound good, bon, bono, bueno, etc.) will help.

  Bono, like Bill Gates, sings about the misery in Africa, while raking the billions in one of Goldman Sachs’ latest conspiracy (he was on the Facebook IPO, and made nearly two billion). Warren Buffet has served the public buffet of forbidden evil foods, and they splurge. Those all too visible plutocrats also make the same lethal mistake as the tiger in Kipling’s Jungle Book… Hopefully their public splurging may attract attention from the destituted commons.  They don’t know that the Lord of the Underground, Pluto, makes itself invisible, for very good reasons. They are blinded by the very goodness they perceive in themselves, after inverting all values.

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Patrice Ayme