Aug 04 2009
Mission accomplished! Up, up and away in my beautiful balloon….the bubble economy has been reflated and it’s oh so glorious to be an American. Matt Taibbi’s Bubble Number Five – The Bailout Bubble as expressed in his brilliant The Great Bubble American Machine is now well on the way to reaching critical mass. Oh come all ye suckers, joyful and triumphant the casino is open again….time to drive up those depleted 401k’s, fine whatever credit cards haven’t been maxed out and spend….spend….spend….
Aug 04 2009
 Muse in the Morning |
 Illumination
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Aug 04 2009
Satire (or truth?) of an Alan Greenspan speech on ‘Economic flexibility’
To the National Association for Business Economics Annual Meeting, Chicago, Illinois – 2005
Original Text
Today I will blow smoke up your ass and tell you why feeding Americans to the Economy and doing away with our social safety net is good for the Masters of the Universe.
Back when word traveled by cargo ship and carrier pigeon, there was no need for Government to protect people from economic fraud. Then the Industrial Revolution started to happen and Adam Smith was channeled to protect the profits of Robber Barons.
With absolutely no concept of multinational corporations and instantaneous communication, Adam Smith had no idea that the Hidden Hand would not function as he postulated it would. Robber Barons captured and bribed elected officials and convinced them that Adam Smith’s Hidden Hand was a good idea despite the fact that the size, scale and speed of an Industrial economy was totally unimaginable to a colonial economist in 1776.
After a few years of irrational exuberance, the Hidden Hand led us into a Great Depression.
Despite the Great Depression, and subsequent dismissal of the Hidden Hand as a viable economic model, the Titans of Industry were able to spend hundreds of millions on propaganda and bribes for elected officials in order to get people to stop protecting themselves with the institution of government.
The measured, Visible Hand of Government of, by and for the People that got us out of the depression, protected the people from exploitation by their bosses, bank and market fraud, famine, and a host of other potential pitfalls of modern day society.
This social safety net was chipped away at by the persecuted Titans of Industry for the next 3 decades.
When the economy started to struggle as US Oil production topped off and we were forced to rely on other countries for oil, that’s when we struck. Starting in the 70s, congress bowed to the pressure of business interests and began ‘deregulating’ everything – transportation, communications, energy and financial services industries. The goal of this scheme was to promote competition, which was supposed to raise our standard of living. De-regulation was coupled with a reduction in trade Bailiffs and Terriers.
As a consequence, the United States, then widely seen as a shining city on a hill, became the land of the paper towel and fast food. Joseph Schumpter of Harvard gave us the term ‘creative destruction’ – the continual scrapping of old technologies to make way for the innovative. In that paradigm, standards of living never really rose despite the fact that new metrics and technologies told us they did. We had a firesale to do away the stuff that made us great at what we do and laid off a ton of people who unable or unwilling to relocate to the third world to work for peanuts.
Through this process, wealth is created, incremental step by incremental step, as high levels of productivity associated with innovative technologies displace less-efficient productive capacity and these spoils were given to the rich. This model presupposes the continuous churning of a exploitative economy in which the new displaces the old and the rich are all that matter.
As the 80s progressed, the success of the scam of transferring money upward was apparent – turning citizen into consumer by removing government protection made it easier to rob and exploit them as they were forced to work harder for less.
Beyond deregulation, innovative technologies, especially information technologies have contributed mightily to enhanced exploitability. A quarter of a century ago, companies often required 10 men to do the job of one guy at a computer terminal, robots work longer, faster and harder than men and we don’t have to pay them at all!
Deregulation and information technologies have joined, in the US and elsewhere to advance the exploitative abilities of the financial sector, but creative accounting may turn out to have been the most important contributor to our current Bubble Economy.
Historically, banks have had to bail themselves out of trouble, as they were responsible for their losses. When they could not do so, the government stepped in. But given recent de-regulation and subsequent hidden leveraging through asset-backed securities, collateral loan obligations and credit default swaps, the banks can hide their risk until the bubble explodes and forces a government bailout. Or they can just threaten to blow themselves up and take government money.
Embarrassingly deficient pricing options and financial mumbo jumbo developed by mathematicians along with fast computers and telecom have significantly increased risk and reward for behavior that, before regulation, was entirely illegal. The new instruments of risk dispersal have enabled the largest and most sophisticated banks, in their credit-granting role, to divest themselves of that credit risk and responsiblity by passing it on to institutions with far less leverage, like the American Citizen and their insurance companies and retirement funds.
These increasingly complex financial instruments have contributed to the development of a far more exploitative, wasteful and hence plutocratic financial system than the one that was dismantled 25 years ago. After the bursting of the stock market bubble in 2000, unlike previous periods following large financial shocks, nobody stepped in to stop the irrational exuberance and protect the people from waste, fraud and abuse.
If we have attained a degree of exploitability that can keep the money flowing to the rich despite the most significant shocks – a proposition that was just fully proven in the Winter of ’09. The ability of the economy to make money for the rich has been enhanced and rich people will be happier.
Governments today, although still more concerned with the General Welfare of their people during the age of Slavery and the Gilded Age are rediscovering the trappings of feeding the economy the lives and livelihoods of their people. We are also beginning to recognize that Global Exploitation is easier with the help of the Hidden Hand.
Through the careful use of political bribes and corporate propaganda, governments in recent decades have stopped protecting their people from exploitation by the marketplace. We appear to be perverting Adam Smith’s notion that exploitation and domination of people by the market and market titans is somehow capitalism. This greater tendency towards exploitation, hiding the truth and self regulation has made the stability of the economy impossible to gauge, even by experts.
It is important to remember that the nature of the market is complex, nobody understands it and things move too fast for governments to act appropriately.
Being able to outsource government functions to private industry is a valuable policy asset. Turning over vital government functions and paying more from them has helped our economy grow. This is a clear demonstration of the benefits of an increasingly exploitative economy.
We weathered a decline on October 19, 1987, of a fifth of the market value of US equities with little evidence of subsequent macro-economic stress because we had regulations on the books to ensure proper oversight and management of the economy. Contrast this with the Stock Market Bubble’s bursting in 2000 – despite the massive waste, fraud, abuse and public outrage, nothing was done to keep it from happening again.
***
In perhaps what must be the greatest irony of economy policymaking, success at exploiting entire populations of people carries it’s own risks. There’s no such thing as a free lunch, and people know that. The good times can’t go on forever and the people are apt to lose their stomachs for risk or to get frightened by gloomy predictions which could lead to widespread exposure of toxic assets. Such developments apparently reflect not only market dynamics but also the all-too-evident alternating and infectious bouts of human euphoria and distress and the instability they engender.
Therefore, because it is difficult to suppress growing market exuberance with a seemingly stable economy, a highly exploitative system needs to be in place to manipulate the markets and to tilt the table back towards the wealthy when the shit hits the fan.
Relying on policymakers to pop speculative bubbles and to stop them from happening again is not an option. As the Federal Open Market Committee (FOMC) transcripts of the mid-1990s duly note, we at the Fed were uncomfortable with a stock market that appeared as early as 1996 to disconnect from its moorings.
Yet the significant monetary tightening of 1994 could not stop us from inflating the bubble. And after the repeal of Glass Steagall equity prices really shot up. The FOMC had the ability to stop this bubble, but it would have been bad for business and for stockholder and consumer confidence, so the band played on, for morale’s sake.
6 years after we saw the problem it appeared that we would have to do something drastic to counteract the euphoria that we allowed to spread because of our actions that were heretofore illegal. In short we would have to pop the bubble ourselves precipitating a recession and shining a bright light on formerly illegal and fraudulent activities. We decided to let the bubble grow and pop all on it’s own. We figured this would be better for rich people, given their superior knowledge, information and connections to markets, they’d be alright.
***
Exploitability is most readily achieved by fostering an environment of few rules and domination by the most powerful entities. A key element in creating this environment is exploitative labor markets. Many working people equate labor market flexibility with job insecurity.
Despite that perception, exploitative labor markets appear to promote job creation. An increased capacity of management to fire workers without excessive cost, for example, apparently increases companies’ willingness to hire without fear of unremediable mistakes. The net effect has been what appears to be a decline in the structural unemployment rate in the united states, and definitely cheaper labor.
Protection of People and trade, both domestic and international, from waste fraud and abuse does not contribute to the welfare of American workers. At best it is a short term fix at a cost of reduced wealth capturing by the economic elite. We need to make train and educate the recently fired, not protect them and their family from exploitative work practices.
Moving forward, I trust that we have learned durable lessons abotu the benefits of fostering and preserving an exploitative economy. That exploitation has been the product of the economic dynamism of our CEOs and firms that was unleashed, in part, by the efforts of corporate propagandists and their bought and paid for policymakers to remove public protections and promote plutocracy.
Although the business cycle has not disappeared, exploitation has made the economy less transparent and more efficient at transferring money to those that matter. To be sure this has created some new challenges for policymakers. But more fundamentally, a more exploitative economy has been key to the impressive growth in the standards of living and economic welfare of the wealthy elite so evident in the United States.
Aug 04 2009
Medical bills prompt more than 60 percent of U.S. bankruptcies
By Theresa Tamkins — CNN, June 5, 2009
This year, an estimated 1.5 million Americans will declare bankruptcy. Many people may chalk up that misfortune to overspending or a lavish lifestyle, but a new study suggests that more than 60 percent of people who go bankrupt are actually capsized by medical bills.
Bankruptcies due to medical bills increased by nearly 50 percent in a six-year period, from 46 percent in 2001 to 62 percent in 2007, and most of those who filed for bankruptcy were middle-class, well-educated homeowners, according to a report that will be published in the August issue of The American Journal of Medicine.
1.5 million Americans x 60% = 900,000 Americans
that’s about 2500 more people per day
… going bankrupt from medical bills, which were NOT covered by our broken Health Insurance system
Aug 04 2009
Though Keith Olberman’s performance here on the matter of Corporate greed and sold out politicians has already been covered here at DD by our own talented author Edger, I thought it was imporatant enough to repeat with video and my own take on the matter.
In comparing the current state of Corporate America to that of the early 1910’s-20’s Keith is dead on. Not since then has the class war been so obvious, never have the Have’s had so much, never have the Have Nots had so little.
Aug 04 2009
I won’t get fooled again.
I voted for Kerry, and I voted for Barrack Obama.
But I won’t ever do it again.
And I of all people should’ve known better.
See, back in 76, I was a 12 year old kid during the Gerald Ford / Jimmy Carter election. I’d seen the Watergate movie, and I had a pretty good grasp of what was going on.
Probably most here have forgotten or never even knew that in ’76 there was also an independent run by Eugene McCarthy–the actually semi-leftist guy the Dems screwed way back in 1968.
Despite strong showings in several primaries – indeed, he won more votes than any other Democratic candidate – McCarthy garnered only 23 percent of the delegates at the 1968 Democratic National Convention, largely due to the control of state party organizations over the delegate selection process.
Emphasis: mine. From http://www.answers.com/topic/e…
Anyway, in 76, since I was 12, I couldn’t drive yet, but I had a cool bike with a blue banana seat, and I cruised all over town handing out literature for Gene.
When election day came I too young too vote, but old enough to canvass, and I witnessed an amazing phenomena:
The Democrats were bringing in carload after carload of scared old people from old folks homes. In return for a nice dinner, they would vote a straight Democratic ticket. That was the deal–the other poll watchers informed me– I was incredulous at first, but they brought them in by Lincoln, they brought them in by vans, they came and they came and they came.
And they didn’t look left. They didn’t look right. Not one took any literature from me or anyone else. And there was fear in their eyes when they saw me–real fear. I assume from hunger, but I don’t know.
They voted, they ate. Or, they ate they voted, I’m not sure which–but I’ve always wondered–since if they were fed first what were they worried about?
I bet they hadn’t eaten yet. And now 33 years later they’re all dead anyway.
Well, 33 years from now I’ll likely be dead too, or at least I’ll be getting pretty damn fragile.
And, I’ll still look left, when asked, even if I have to forgo supper.
Aug 04 2009
Crossposted from The Wild Wild Left
Emotion is strength. Love is both giving and tough. Pain is a teacher, sorrow is a guide. The converse, that emotion is weakness, is the biggest lie ever told.
Ultimately, our very essence is about keeping ours alive and well, we are the caretakers, the life givers, those who never give up on our children, who always find a way.
Its not that men are inferior. They are just wired differently, and trained by society to be about impressing and garnering power over others. They think that’s how they attract women, mistake admiration (jealousy) of other men for friendship. Alliances are based on using someones strengths to their benefit, what is in it for them.
Men are about power and sex, and the power to get sex.
Women are about sustaining the species.
Women love people more for their weaknesses, their humanity, are more forgiving.
Women don’t war for “stuff”… they will only fight to protect their own, or someone they see as in need in of protection, the weak.
The famous saying goes, “Those who seek power don’t deserve to have it.”
Who has sought power? Who has not?
Look to us, who have sat in the background, quietly running things so our men could seek the glory they need. Propping up their egos, when they don’t attain it. Fixing things, healing bodies and hearts, and always, always taking the shadows.
Kind of stands to reason, yes? “Those who don’t seek power (for powers sake, especially) surely do deserve it.”
The World can only be saved by Love. Our kind of Love.
Aug 04 2009
WASHINGTON, Jan. 7 – Families earning more than $1 million a year saw their federal tax rates drop more sharply than any group in the country as a result of President Bush’s tax cuts, according to a new Congressional study.
The study, by the nonpartisan Congressional Budget Office, also shows that tax rates for middle-income earners edged up in 2004, the most recent year for which data was available, while rates for people at the very top continued to decline.
Based on an exhaustive analysis of tax records and census data, the study reinforced the sense that while Mr. Bush’s tax cuts reduced rates for people at every income level, they offered the biggest benefits by far to people at the very top – especially the top 1 percent of income earners.
Aug 04 2009
From Michael Moore via email:
Keith Olbermann to Expose Congressional Opponents of Universal Health Care Tonight!
Monday, August 3rd, 2009
We’ve just received an advance transcript of tonight’s Special Comment by Keith Olbermann on his MSNBC show. It is nothing short of brilliant — and if all of America were to hear what he is going to reveal tonight, we are certain the vast majority of Americans would be on the phone to their elected representative immediately, calling for an end to the private, for-profit, rip-off health insurance companies who have wrecked our country.
Here’s a brief section of Keith’s editorial tonight:
Aug 04 2009
An amendment introduced by representative Anthony Weiner, which would have created national single payer, has been traded in for a vote on the House floor in September, as a part of the deal between liberal and conservative members of the Democratic Party. The case – in support of single payer – made by some Democrats during the mark-up echoed the speeches given at a rally, which took place in the Upper Senate Park on Thursday, July 30th. That same day a number of members of the Congressional Progressive Caucus held a press conference on the Capitol Hill where they announced their intent to fight for a robust public option. The Real News spoke to David Swanson from Democrats.com who attended both the rally and the press conference.
Real News Network – August 3, 2009 – 9 minutes
Some members of Congress are going to fight for a robust public option and a single-payer amendment
David Swanson is the creator of ImpeachCheney.org, co-founder of AfterDowningStreet.org and Washington Director of Democrats.com A writer and organizer, Swanson has worked for ACORN, the International Labor Communications Association, Dennis Kucinich’s 2004 presidential campaign and many others.
Aug 03 2009
Happy Monday and welcome to the Dog’s ongoing letter writing campaign for accountability for the Bush Era State Sponsored Torture program. The premise of this campaign is to write decision makers every Monday urging them to do the right thing in terms of our international treaty obligations and our Federal statutes. This means to investigate the enormous amount of prima facie evidence and where warranted by the evidence, to prosecute. The Dog writes a letter every week, which you, the activist, can either cut and paste or use as the jumping off point for your own letter.
“Originally posted at Squarestate.net“
