I’ve been worryin’ a lot lately about America losin’ it’s traditional values under our socialist President. Socialism, for those of you who talk about it all the time even though you don’t understand what it means, is the process of ruining the economy by removin’ the traditional role of religion from it. Obama is tryin’ a whole bunch of voodoo economic policies, and we all know how God feels about voodoo (it barely ranks above bein’ a Muslim). We’re gettin’ bombarded with lots of talk on how to fix the economy but we seem to be ignorin’ the One Voice we should be listenin’ to.
Mostly this is an explanation of a theory behind the current economic crisis. Robert Brenner, who teaches economic history at UCLA, suggests that the fundamental root of the crisis is the stagnant nature of the neoliberal economy, which attempts to evade its problems with overcapacity by intensifying borrowing.
In plain English: once the loans dry up, the neoliberal economy tends to sink. Turn the page to discover why.
I read this statement this morning and I just shook my head:
Dimon of New York-based JPMorgan this month called on government officials to stop demonizing Wall Street, saying “it’s just hurting our country at this point.”
“When I hear the constant vilification of corporate America, I personally don’t understand it,” Dimon said in a speech earlier this month hosted by the U.S. Chamber of Commerce in Washington.
I bet you don’t Mr. Dimon. But working people losing homes and jobs sure do.
We need more vilification of corporate America, not less.
We will never have change in this nation until we admit the problem is a system that places profit over people.
I do not think we will see that soon, not even people AND profits. Just a softer and gentler version of Profit over People.
After weeks in which the White House was often sharply critical of excesses at financial companies, the president wants to adopt a more collaborative approach.
“We’re reliant upon them to help rebuild our economy,” said senior adviser Valerie Jarrett. “It would be very unnatural if we didn’t engage them and have a direct opportunity to pick their brains and look to the future.”
Which side am I on? Workers over investors. Labor over capital.
In 1931, coal miners in Harlan County were on strike. Armed company deputies roamed the countryside, terrorizing the mining communities, looking for union leaders to beat, jail, or kill. But coal miners, brought up lean and hard in the Kentucky mountain country, knew how to fight back, and heads were bashed and bullets fired on both sides in Bloody Harlan.
It was this kind of class war — the mine owners and their hired deputies on one side, and the independent, free-wheeling Kentucky coal-miners on the other — that provided the climate for Florence Reece’s “Which Side Are You On?” In it she captured the spirit of her times with blunt eloquence.
Mrs. Reece wrote from personal experience. Her husband, Sam, was one of the union leaders, and Sheriff J. H. Blair and his men came to her house in search of him when she was alone with her seven children. They ransacked the whole house and then kept watch outside, ready to shoot Sam down if he returned.
One day during this tense period Mrs. Reece tore a sheet from a wall calendar and wrote the words to “Which Side Are You On?” The simple form of the song made it easy to adapt for use in other strikes, and many different versions have circulated.
Banks, investment companies, financial institutions of all sorts are in line to be fixed and regulated. Their survival is deemed vital to our economic survival. Get them lending again, we’re told, and we’ll start to see the economy moving.
Everything will be fine and we’ll party like it’s, well, like it’s some year when the economy appeared to work.
But that party may be missing some guests.
And by guests, I mean a significant number of citizens, the regular folks, the working and middle classes.
What if the financial institutions cleaned up, spritzed on their Axe cologne, and the Administration put on their party clothes for nothing because the invitation for a significant number of regular folks got lost in the mail?
The history of the last century shows, as we shall see later, that the advice given to governments by bankers, like the advice they gave to industrialists, was consistently good for bankers, but was often disastrous for governments, businessmen, and the people generally.
-Carroll Quigley
As the conventional wisdom goes, the stock market is predicated on trust and as a crusty old uncle of mine once said to a young and impressionable teenager with zero knowledge of the way that the world really worked: “trust me is just another two letter word that means the same as fuck you.” Old Uncle Harvey’s words of wisdom came home to roost on this Monday morning in America when the finance oligarchs were able to use their inside juice to pull off the grandest and most audacious heist yet in this season of sleazy swindles. Obama Treasury Secretary and Wall Street fixer Timothy Geithner delivered the bacon for the bankers, gave the crack ho stock market a wonderful and intoxicating fix that sent the Dow screaming up by nearly 7 percent in a matter of hours and locked in the losses for the great grandchildren of every poor schmuck with the misfortune to be living through this period of plunder and wealth consolidation.
A black hole gravitationally sucks in everything that comes near it, and nothing can return from the other side of the event horizon once sucked in.
Banks lending money is one of the major, if not THE major way they produce revenue and profit. In any business, when sales are down you do everything you can do to increase sales revenue – or you go bust – UNLESS you can produce revenue another way.
Yet the real message coming through is that the banks BANKERS seem to have decided that they do not want to increase revenue in any other way than simply taking it from taxpayers instead of lending to generate revenue.
This leads me to suspect that they have no intention of returning to providing the “product” they have always provided to generate revenue, but instead have decided to simply and openly steal it, and that the current economic crisis is not something the government is trying to correct but is instead actively a partner in intentionally manufacturing.
With government help. With Geithner’s help. With the presidents help.
We have a big problem. The problem is not the economic crisis.
What is “government”?
“Very simply, it is an agency of coercion. Of course, there are other agencies of coercion — such as the Mafia. So to be more precise, government is the agency of coercion that has flags in front of its offices.”
–Harry Browne
Thomas Ferguson is an American political scientist and author who studies and writes on politics and economics, often within an historical perspective. He is a political science professor at the University of Massachusetts Boston. He obtained his Ph.D. from Princeton University. He is also a contributing editor for The Nation.
Today Ferguson talks with Real News CEO Paul Jay about the banking crisis and the black hole at the center of the crisis, the Obama administrations response so far to it, and about something he thinks really needs to be done that is not being done.
Real News – March 25, 2009 – 12 minutes 25 seconds
Obama should save the banks, not the bankers
Tom Ferguson: Stimulus package is dangerously small; plan for toxic assets shovels money to bankers
Has Treasury Secretary, Timothy Geithner, done a good job so far? Kinda, I wouldn’t give him a gold star or anything. In fact, I’d say he’s done a mediocre job. Did he know about the whole bonus thing at AIG? And what about how the situation that went down with Lehman Brothers? Bottom line, is the GOP push to have Geithner removed legit? I say no.
Many have already heard about the kids from Pomona California Village Academy High School, many have probably caught their little eight minute video that has launched them into the National Spotlight and Political Debate on what this Country is now going through. But this isn’t new it’s just affecting many more kids and families now, with more added each day. Kids can’t learn and achieve any dreams they might have if their families are struggling and their living those struggles daily.
What do you get for pretending the danger’s not real.
Meek and obedient you follow the leader
Down well trodden corridors into the valley of steel.
What a surprise!
A look of terminal shock in your eyes.
Now things are really what they seem.
No, this is no bad dream.
-Pink Floyd (sheep)
In the ongoing madness of an America in terminal decline, the great Surge II is now underway. This one has nothing to do with mass brainwashing that all is ell in Iraq and that we are indeed winning thanks to our shining medal festooned superstar quarterback otherwise known as General God (aka David Petraeus) to divert the flocks attention away from a doomed imperialist crusade. Nope, this one hits closer to home, it started last Monday with a sly piece of internal propaganda from Citigroup’s CEO Vikram Pandit having its best quarter since 2007 which triggered a sucker rally in the Wall Street casinos that dictate to the inhabitants of chumpland. The pocket media once again did their job, selling this latest call for the sheep to come and be sheared with all the effectiveness that they pimped the murderous lies of George W. Bush, Karl Rove and Dick Cheney. Things – ARE getting better you see, the gloom-gloomers, the glass is half-empty pessimists, the neurotic nervous nellies and the naysaying Eyores are all wrong, it’s a disease, in their heads, the economy is rocketing its way back to robustitude. The most incredible example of just how thoroughly corrupt that the corporatist media has become is the pernicious cover story of the latest edition of Newsweek magazine that has a picture of good ole Uncle Sam saying that he wants YOU to START SPENDING!… YOU need to INVEST in America – before it’s too late.
posted yesterday by leveymg on the Madoff empire. His piece illustrates the incestuous, pervasive corruption of U.S.–and global–high finance.
One rarely finds this level of scrutiny and analysis in the bought-off MSM, but every day a scouring of the blogosphere uncovers several such detailed, insightful postings.
Anyone on the Left or Right who cares to probe has by now figured out that Geithner, Summers and Bernanke (Three Amigos? Three Blind Mice? Or just another Wall Street consultancy?) helped create and enable this rickety Ponzi economy of bogus wealth resting on paper pyramids, rather than on real economic activity producing goods and services. The three of them are interested in propping up the rapidly collapsing pyramid, not in reengineering it.
The literally trillions of dollars of magical, digital fiat money that they are now pouring into the economy to halt and reverse the deflationary spiral and economic meltdown are signs of desperation. At least some of the hundreds of billions are going to economic stimulus that will result in real economic activity. But what about the literally trillions that are merely going to prop up the balance sheets of insolvent financial giants that made calamitously bad bets on derivatives? Some
If you’re anything like me and I suspect like most of us, you know about the scandal surrounding AIG’s bonus payouts to the same company employees in their London operation that were at the center of the Credit Default Swap scheming that triggered the current global financial meltdown, but also like me you’re probably no economist nor expert in financial matters and are having a difficult time wrapping your head around what, exactly is going on, how we got here, and why our economy seems to be collapsing.
Sharona Coutts is a law graduate and an honors graduate from Columbia Journalism School’s investigative seminar and now writes for ProPublica, an independent, non-profit newsroom in Manhattan that produces investigative journalism and describes themslves as “producing journalism that shines a light on exploitation of the weak by the strong and on the failures of those with power to vindicate the trust placed in them”.
Sharona has put together a very good Q&A piece that helps in understanding what exactly is going on with AIG. She has also produced a very good related piece: Timeline: AIG and Their Bonuses that she quotes in the Q&A article reproduced here.
by Sharona Coutts, ProPublica – March 18, 2009 5:12 pm EDT
Monday marked six months to the day since AIG’s first bailout, but it wasn’t until news of executive bonuses over the weekend that public fury truly focused on the hemorrhaging insurer.
President Obama told Americans he was “choked up with anger” over bonus payments to executives at AIG’s Financial Products office whose bad bets pushed the company to the brink of collapse. The administration is worried about public anger turning against it, not just the company.
In some respects, the sudden anger is mystifying. After all, there’s nothing new about the bonuses except that a portion of them – $165 million – were actually paid on Friday. Contracts instigating the bonuses were made a year ago, and they’ve regularly been in the news in recent months.
And the amount involved is dwarfed by the tens of billions that flowed to banks and hedge funds.
AIG’s plan to pay bonuses have been public knowledge for more than a year. Why is this blowing up now?
One of the best and most refreshing changes established by the Obama Administration has been its reliance on intellectuals, scientists, and experts rather than lobbyists and ideologues. Across a broad swath of federal departments, pragmatism seems once again to be valued. Unfortunately, with the world economy imploding, Obama continues to rely on the advice of corporatist insiders, and their advice is predictably corporatist. There also seems to be a bit of myopia going on.
On Saturday, Joan Walsh warned Obama supporters not to be taking credit for the previous week’s slight market rally:
As someone who has repeatedly defended Obama from GOP efforts to blame him for the current crisis and to deride the “Obama economy” only 55 days into his presidency, I think the administration could be playing a dangerous game. Live by the week’s economic news, die by it as well. If the Dow dives next week, or retail spending dips again, does that mean the stimulus failed?
“Consumer confidence is slightly up. The market is slightly up,” Biden said. “It’ll go down again, but the people are beginning to figure out that the president’s got a plan and he believes we can work our way through this.”
Um.
Nouriel Roubini has been warning that there may be “dead cat bounces,” or “bear market suckers rallies,” and there’s no reason to think the latest is anything else. Which means that Biden should maybe be a little more circumspect about taking a day trader’s view of a one week market rally.
Monday marked six months to the day since AIG’s first bailout, but it wasn’t until news of executive bonuses over the weekend that public fury truly focused on the hemorrhaging insurer.