Thursday, March 25, 2010

Progressives UNITE! Nothing to Lose but Your Chains - Mish & Faber Say "We're Doomed" & Bageant Already Out of Country

(EXTRA: If anyone could make a contribution to my PayPal account (or otherwise - contact me for further info), it would be sincerely appreciated as I've just gone off the cliff financially. I really appreciate everything that my kind readers have done for me in the past financially and otherwise. Now . . . back to your regular viewing.) Did you hear the good news about the latest missive from Osama bin Ladin? Dead for seven years according to very well-informed sources and yet "Johnny on the Spot" whenever needed for a fresh dose of fear for a barely sentient electorate. I was thinking just the other day about the way current events seem to be working their way into my freshly-written philosophy essays (after the fact). It's uncanny. (I'm trying to finish writing a story now about a friend of mine who has just died from the current (USA-specific) health-care, industry-profit-generating (for the war machine's continued health) philosophy. And, sad to say, he's not alone (many, many more will die and soon).) (And, yes, Lisa, this is a long one. Pull up the chaise longue - and pop a cold one.)

I may not like everything Joe Bageant says (and who would(?) - it's so depressing), but it's hard to disagree with his latest whispers to teh uninformed but curious (okay, the "informed" like whispers too). (And this explains rather well why the inhuman beings we see on a daily basis in positions of power within our governing halls seem wholly simpleminded - it's gotta be self defense or they were uniquely chosen for such virtues - except for the Rockefellers, of course - and who benefits from all these planned defaults from the people who will not be able to afford the newly ordered insurance purchases?) (Emphasis marks added - Ed.):

. . . the corporations drive the politicians who manage America's political consciousness, steering it around a thousand truths toward extraction of maximum profit from the American herd. The herd, honestly speaking, regards politics mostly as spectacle - some emotionally, others as entertainment, if they think about it at all. Let's not mistake the Tea Party noise or yammer about sham healthcare "reform," both of which are theater state productions, for political involvement by "the people."

Those Americans who seldom give politics (or anything else) serious thought, simply accept whatever is spoon-fed by media and The Complex, an entity so omniscient as to be beyond their comprehension. This is quite OK with most working class Americans. They have much in common with the average working Mexican, who simply ignores politics, out of disgust, and/or semi-illiteracy.

Unlike Americas who have not awakened to the slow motion coup that successfully overthrew their government decades ago, working class Mexicans here understand such defeat. They've had it for breakfast, lunch and dinner for over a hundred years. I have never met anyone here who did not grasp that drug money and elite business cartels own the government because they paid cash for it. Dope and business elites pay for candidates' campaigns and the politicians in office, the same as corporate cartel money buys our Congress.

The working class folks in my neighborhood here deal with the politics of drugs and government corruption through obliviousness, either purposeful or genuine. Generations of disillusionment with politics seem to have the same effect on poor and working people everywhere, whether it is the black ghetto, the shacks of Appalachia or the hardscrabble neighborhoods of Mexico - Apathy. Voting is compulsory in Mexico, but there is no enforcement whatsoever, lest an angry turnout affect the status quo in times of crisis, of which there are many.

American politicians have traditionally been happy with the American underclass' allergy to the voting booth. Yet some pretense of democracy must be maintained, some false flag of popular consensus held aloft, if the engines of profit are to be kept fueled and running. Which means marketing some pretty unsavory stuff as being part of what is brave, good and right about America? In hyper-capitalist American culture, everything, be it cars, cancer or war, every activity, legal or illegal, must turn a corporate profit. That includes even the nastiest activities, such as drug distribution and addiction.

So the far-flung network of profitable state sanctioned industries, from prisons and police battalions, to rehabilitation, are marketed as necessary fixtures of the "drug war." The term Drug War is an empty term to anyone who has even for a moment rationally examined it, two words - like Islamo-fascism - married incongruously in a shotgun wedding of political theater. However, for most Americans, those two words work well enough. Our attention spans are briefer than a rabbit fuck. Anything in depth is anathema. Only slogans and brands survive. We do not understand much of anything in depth except the football rating system.

But we do understand war, or believe we do, so "War on Drugs" works as a brand. It has been that way ever since the post World War II military industrialization of the country's economy and consciousness - which are pretty much the same to us. War, of one sort or another, is the solution to most of those things that we are told threaten America - which is to say American capitalism - either directly or indirectly. And according to the long-running national storyline, they have always come from outside our borders - Barbary pirates, white slavers, the "Cold War," against anti-capitalist communism, terrorism, Islam, drugs, job loss to Mexicans and to China, swine flu, bird flu. Never-never-never do they result from our own actions, misjudgments or, heaven help us, our own folly.

Chris Floyd of that spectacular venue Empire Burlesque, unfortunately, for the powers-that-benefit from our confusion, puts a fine sheen on this latest nugget of fertilizer.

Closing Time: An Historic Confirmation of Corporate Power It looks like heaven but it feels like death; It's something in between, I guess: It's closing time.

Leonard Cohen Official transcript of remarks by President Barack Obama after the March 21 vote in the House of Representatives on H.R.3590: Motion to Concur in Senate Amendments to Patient Protection and Affordable Care Act: My fellow Americans. As many of our more serious commentators have noted, Democrats and progressives have sought genuine reform of our broken, bloated, unjust health care system for almost a hundred years. Today, I am proud to say that we have brought that century-long struggle to a close. Together with our visionary partners in the House and the Senate, we have finally killed genuine health care reform for many years to come - perhaps even for another century! The struggle is over, the deal is done, the fix is in, and corporate power - unbridled, unchallenged, coddled, protected, and larded with the endless pork of government-guaranteed profit - has triumphed at last. This is an historic achievement. This is a mighty legacy we will bequeath to future generations. This, my friends, is what change looks like. Now, you know and I know that such change never comes easily. It never comes without opposition. It never comes without controversy. Even in this hour of victory, we know that the doom-sayers will be out in force. And I'm not speaking here of the Republicans, whose opposition has simply been a lurid, baseless "Red Dawn" fantasy about "Communism" coming to America. "Communism" - in a bill that has been written by our visionary partners in the corporate community, by our hyper-capitalist friends and patrons on Wall Street, by the lobbyists and bagmen of Big Money! It's true there is a tinge of socialism in the bill, but it is, of course, the only kind of socialism that is tolerated in America: socialism for the rich, where the masses shoulder the risks - and the costs - while the wealthy reap the profits for themselves. The health-care barons, the bailed-out banks, the farm-devouring agri-conglomerates, the war profiteers . . . we've got plenty of Boardroom Bolsheviki out there - but it sure ain't "Communism" like Castro used to make! So let them hoot and holler down this false trail all they like; for as I learned back in my Senate days, when I was considered part of the "anti-war" faction, opposition without substance only entrenches the status quo. No, what we must look out for are all those - or rather, those very few - nattering nabobs of negativism who have opposed our historic corporate empowerment bill out of - get this - principle. Like barnacles hanging onto the butt of the Titanic, they have clung to the idea of truly universal, equal, single-payer health care, a system that is less expensive, more efficient, more secure, more democratic, more popular and more effective than the heroic measure we have passed here today. These poor wretches - who now must face the wrath of Kos and the wroth of Rahm for their tragic apostasy - are simply not savvy enough to see that our 2,000-page boondogglepalooza, riddled with fine-print exceptions, toothless regulations (which we will 'enforce' every bit as rigorously as Wall Street has been regulated all these years), impenetrable phase-in and phase-out schedules, and mild benefits that won't even begin kicking in for years - and that even after a decade will still leave millions of people uncovered - is much better than a simple, streamlined system that could be implemented by the end of this year, bringing genuine relief from intolerable, life-degrading financial burdens and medical problems to millions and millions of people in dire need right away. Or as that avatar of negativity, Ralph Nader put it:

The health insurance legislation is a major political symbol wrapped around a shredded substance. It does not provide coverage that is universal, comprehensive or affordable. It is a remnant even of its own initially compromised selfbereft of any public option, any safeguard for states desiring a single payer approach, any adequate antitrust protections, any shift of power toward consumers to defend themselves, any regulation of insurance prices, any authority for Uncle Sam to bargain with drug companies, and any reimportation of lower-priced drugs.

Hey, Ralph, thanks for reciting my credits! All those "berefts" you cited were the result of my own super- savvy negotiations! It's 11-dimensional chess, man, a really heavy-duty Matrix Zen Jedi Master use-the-Force kind of thing, where you win the game by giving away everything you have in the opening move! But you're too much a dinosaur to understand. 'Anti-trust protections!' Hey, Teddy Roosevelt - your horse-and-buggy is waiting! Just listen to this guy:

Most of the health insurance coverage mandated by this legislation does not come into effect until 2014, by which time 180,000 Americans will die because they were unable to afford health insurance to cover treatment and diagnosis, according to Harvard Medical School researchers.

Well, what can I say? 180,000 is a lot of dead people. This is a very hard choice, but the price — we think the price is worth it. Then there's this Chris Hedges guy. He used to be a "serious" journalist, reporting on the imperial wars for our corporate partners in the stovepiping community - what old-timers and barnacles still like to call the "news media." But he went off the rails a long time ago and joined the carpers and cranks on the sidelines, those malcontents who, unlike so many of our progressive partners today, have never imbibed the timeless wisdom of Warren G. Harding: "Don't knock, boost!" Just get a load of Hedges here, making the big-whoop observation that our historic bill is just a bloated version of the already-failed, Republican-created Massachusetts plan:

Take a look at the health care debacle in Massachusetts, a model for what we will get nationwide. One in six people there who have the mandated insurance say they cannot afford care, and tens of thousands of people have been evicted from the state program because of budget cuts. The 45,000 Americans who die each year because they cannot afford coverage will not be saved under the federal legislation. Half of all personal bankruptcies will still be caused by an inability to pay astronomical medical bills. The only good news is that health care stocks and bonuses for the heads of these corporations are shooting upward. . . . The bill is another example of why change will never come from within the Democratic Party. The party is owned and managed by corporations. The five largest private health insurers and their trade group, America’s Health Insurance Plans, spent more than $6 million on lobbying in the first quarter of 2009. Pfizer, the world’s biggest drug maker, spent more than $9 million during the last quarter of 2008 and the first three months of 2009. The Washington Post reported that up to 30 members of Congress from both parties who hold key committee memberships have major investments in health care companies totaling between $11 million and $27 million. President Barack Obama’s Director of Health Care Policy, who will not discuss single payer as an option, has served on the boards of several health care corporations. And as salaries for most Americans have stagnated or declined during the past decade, health insurance profits have risen by 480 percent. ...Obama and the congressional leadership have consciously shut out advocates of single payer from the debate. The press, including papers such as The New York Times, treats single payer as a fringe movement. The television networks rarely mention it. And yet between 45 and 60 percent of doctors favor single payer. Between 40 and 62 percent of the American people, including 80 percent of registered Democrats, want universal, single-payer not-for-profit health care for all Americans. The ability of the corporations to discredit and silence voices that represent at least half of the population is another sad testament to the power of our corporate state to frame all discussions . . . .

Again with the credits! Stocks going up, corporate heads filling their pockets, pols gorging on backroom baksheesh, the stovepipers in the tank, Big Money controlling the debate . . . Earth to Hedges: That's what we're here for! That's the whole point! You're an old Seventies guy, aren't you, Chris? You remember ZZ Top? "Jesus Just Left Chicago"? (If you'll pardon the immodesty.) What do they say? "Taking care of business is his name." They got that right. So who cares if the plan "fails"? Who cares, if, as you say,

[the plan] will not expand coverage to 30 million uninsured, especially since government subsidies will not take effect until 2014. Families who cannot pay the high premiums, deductibles and co-payments, estimated to be between 15 and 18 percent of most family incomes, will have to default, increasing the number of uninsured. Insurance companies can unilaterally raise prices without ceilings or caps and monopolize local markets to shut out competitors.

Listen, Hedgie: If the plan was to reform the health care system for the benefit of the people, then we would have, like, reformed the health care system for the benefit of the people. You follow? The plan was, is, and will always be to appear to be reforming the system - to make the rubes believe that something is being done to alleviate their pain - precisely to avoid really reforming the system, which is just too good and greasy for too many of us at the top of the imperial pyramid. And when this plan fails - as it will, as it will - then you rig up another boondoggle, another "great debate" full of sound and fury, signifying zilch, to keep the rubes at bay. Meanwhile, we can get on to the real job our corporate colleagues and patrons want us to do - bringing that other old dream of social amelioration for the common folk to an end at last: Social Security. Scalpel, Nurse! The doctor is in!

I know I shouldn't . . . but some of the comments on this essay were just tooooo good not to share (and it's not that we hadn't thought of them ourselves, previously, but had tried to put them out of our minds due to our personal insanity clauses - "Thou shalt not write something that makes you immediately go insane" (or click on the link for the essay and go to the bottom for the comments)):

1. Think about this one for a minute: if the GOP supported the bill, Democrat-identifying Americans would question its provisions, because most Americans are binary thinkers when it comes to federal politics. Democrats identify more as NOT BEING REPUBLICANS than they do as standing FOR something. Thus, if the bill were endorsed by the GOP as well, Democrats would be wondering what is going on, whether the bill goes FAR ENOUGH, because what partisan piss-pot Donklebots love more than anything is "winning one" against the Evil Rethuglicans. By pretending to be opposed to this bill as "socialism" (which they CLEARLY know it is NOT), the Republicans ensured its passage and therefore its guarantees of massive profits for the big corporate interests they serve. What those in power fear now is the populace seeing through the charade of Obama's supposed nobility and pragmatism, into the festering sewage that is our soft fascism. The Republican "opposition" to this "reform" was calculated to make Donkeybot Americans NOT QUESTION the bill's actual provisions. By NOT QUESTIONING those provisions, the Donkeybot Americans will accept what Obama, Pelosi, Reid, Kucinich tell them about the bill - i.e., "the best we can do now." The supposed "opposition" by the GOP was designed to ensure the bill's passage without public outcry or question. The GOP don't actually believe this is Marxist legislation. They know it is pure Mussolini, not essential Marx.

2. Emotive - Can you imagine a scenario that carries more negative emotion for the average American citizen than being forced to buy products from vilified corporations under pain of enforcement, collection and fines by the Internal Revenue Service? What were these people thinking? It reminds me of the old SNL skit where a radio talk show host is faced with a bank of phones that aren't ringing. So he proposes the following topic:

"The use of tax free municipal bonds to pay for the forced busing of Chinese Communists into your neighborhoods for the purpose of killing your children's puppies."

This Bill is possibly the worst of all possible worlds. The health care system in the US has, for decades been carefully tailored to funnel ever increasing resources to the politically connected.Movement in either direction: Toward Single payer or a libertarian opening up of what's a stunningly controlled industry with more barriers to entry than you can imagine, would have been preferable to the expanding and cementing of the oligarchical/corporate system that this bill achieves.

Now that health care reform has been "done," nothing will change in the basic system and the looting will continue with Vigor and Abandon. As Avedon Carol pointed out back in December: "In 2007, public expenditure (i.e., tax money) on health care per person, was around $3,300. That's before you paid your "insurer", before you paid your doctor, before you paid for any form of treatment, you paid $3,300 whether you needed it or not. (As an American, you also had the privilege of paying even more than that for commercial costs, bringing your total to an average of $7290.) In that same year in England, the total expenditure of taxation and private expenditure was$2,992 per person. * Let me put that another way: US paid by your taxes: $3,300 (or thereabouts) UK taxes plus private: $2,992 And the kicker is, even relatively low-income minorities in the UK get better health care than the well-off in America." 3. Grandma Jefferson - The Rage of the Sheep is Terrible, or, What if Bush Did It? As Chris points out, the really predictable part of this sickening farce is the way the zombie "progressives" fell over themselves endorsing a bill that, months ago, they denounced, while turning yet again on their base of long-suffering battered liberals, because it's now framed, not as viable health care for all citizens, but instead as a necessary mop up operation to salvage the worthless caretaker presidency of the Butler-In-Chief, and the "credibility" of the Dimbulb party, an even less viable commodity. First under the hc "reform" bus was, as always, women, and their chance of getting legal abortions covered by federal insurance. But we're going to have to start digging to make more room down here, because it's sardine packed with the anti-war crowd, the anti-torture/anti-patriot act groups, the slash-the-MIC funding folks, anti-domestic spying groups, all minorities & civil rights supporters, State/Church separationists, war-crimes tribunal backers, people who want banks regulated & bank criminals prosecuted, and so on. We're running out of air, even faster than everyone else above ground. The alternative is of course handing over the nation to the open control of the NeoNaziCon Party, run by JabbaRush, Beck, Coulter, and the rest of the ghoul-pack whackjobs who openly call for violence and lynch-mob murder of people who disagree with the batshit-insane inchoate mass of psychobabble they are pleased to characterize as their "love of the Constitution", which they show by demanding secession. Nobody suggests a third party, which is too bad, because 80% of the destitute nation is sick of uni-party rule, and most of them are far more liberal than the beltway sycophants of the MSM who currently shape "political thought" in these parts, such as it is, would like anybody to believe. Of course, the Ministry of Propaganda prefers to spend its time projecting the RWNJ's as the "silent (sic) Majority" of sincere patriots, who can't be called "terrorists" just because they wave loaded guns in public, attack abortion clinics & staff, spit on congresspeople, or choose to fly their own planes into office buildings in protest at being forced to pay back taxes. The countdown begins for employers to drop group coverage for their employees, forcing them into private coverage at triple the cost...now. And wait until we get those notices in the company e-mail of the day.

4. Jimmy Montague - There was a long article in WaPo -

The WaPo published a long article that supposedly explained the new legislation: who's covered, who isn't, who has to pay whom, for what, how much, when, etc. I have a master's degree in journalism. I'm an expert writer and critical reader. After reading the third paragraph of WaPo's "explanation," I got a headache and started to cry. Based upon that experience, my conclusion is that this health-care thing, whatever it is, can never stand. Long before it all goes into effect, people are going to start shooting up hospitals. Physicians and nurses won't be able to go about in public. Police will not protect them. Congress will repeal this thing or there WILL be revolution.

. . . the history of a hundred years ago always comes to my mind; Big Bill Haywood, Eugene Debs, the great labor leaders, would probably be puzzled by what we call Progressive today. Haymarket Square happened in the 19th century, fer chrissakes, which is where a lot of our problems started. Santa Clara County vs. Union Pacific Railroad, which established personhood for corporations was bad law, plain and simple, this is the root.

With the Citizens United ruling, we have moved into very dangerous territory, we are now just cogs in the machine; like Charlie Chaplin in Modern Times. This insurance mandate is bad law, as the people are now totally subservient to capital, with the fed as the enforcer. this is upside down.

Derek, you may find this of interest where your take on Citizens United v FEC is concerned: http://progrepnow.blogspot.com/2010/01/amber-talks-to-mr-lysander-about-recent.html I'd suggest that Citizens United is not an evil portent of the future, but instead a mere formalization of what already is. Formalizing what already is, that's just a formality. Which is why the word "formalizing" was chosen. If I kill someone in cold blood, I have murdered that someone. The judicial finding of murder isn't what made it murder. It was the act itself. Let's not inflate the meaning of a SCOTUS ruling. What matters is what is extant in America. Even without Citizens United, corporations were running the show in American politics. Citizens United didn't change that. -----

While you're reading about Ludlow, don't forget to read The Autobiography of Mary Harris "Mother" Jones. Mother Jones was the Joan of Arc of American Labor. A UMW organizer, one of the leaders at Ludlow. Little old Irish granny lady, wore her gray hair in a bun. Stood in front of the pickets in her little black granny dress and slugged it out with the biggest, meanest goons that money could buy. She did that for fifty years. Last arrested at the age of 85, fifty thousand people came to her funeral when she finally died. Management always said she was the most dangerous person in the whole country.

And now back to our regularly scheduled programming . . . . I always pay close attention to anything Mike "Mish" Shedlock and Marc Faber say. (This is not one to miss.) We're Doomed and Washington Can't Do Anything About It Joe Bageant, journalist extraordinaire already quoted above and happily ensconced directly south of our border for the foreseeable future, was back in the states for a car repair by his unredeemable southern (German obviously) mechanic the other day. (As I used to have a VW mechanic in Winston-Salem named "Wolf," I get the jokes.) You don't want to hear his latest take on what is upcoming for our economic disenjoyment in From Wall Street to Skank Street. But you should. (Emphasis marks added - Ed.)

Last time I was there, Gunther was reared back in his one-armed swivel chair, behind a desk piled with 7-Eleven sandwich wrappers, rusted obsolete tools and cigarette butts, holding forth on the stock market. Gunther plays the market in a small way, small enough that his broker never returns his calls.

"I'll tell ya what the stock market game is all about."

I didn't remember asking, but I knew I wouldn't get my turn signals fixed unless I listened.

"Used to be that a guy would pick a stock based on the facts. After a while, it got so that people looked around to see what other people's average opinion was, and they bet on that. Nowadays you look around and try to guess what the average opinion of the average opinion is. If you can guess enough other people's guesses about other people's guesses, then you bet on that and you make money. Don't fucking matter if the stock is a dog. The stock market now runs the whole damned economy based on what fools believe other fools believe other fools believe. Run by a bunch of economists who figure that if they make enough fools believe the stock market is OK, then the economy will be OK. What if I ran my business that way? What if all I had to do was make people believe their cars was fixed? I'd go broke."

. . . The petty right and the bumbling left find themselves unexpectedly meeting one another these days, as they navigate the craters of our bombed out economic landscape. Were it not for the ideological war in progress (it's not a cultural war, no matter what the university pundits say, it's a capitalist-state-sponsored ideological war), they would probably form a powerful combined populist movement that would scare Washington right out of its silk shorts. Naturally, political strategists on both sides do everything possible to keep the rank and file from discovering the growing overlap of liberal and conservative thinking (or in some cases, nonthinking).

Not many working people on either side still believe that what is good for Wall Street is good for Main Street, or that very much trickles down from Wall Street to our level. No matter how much money we sweat for, or borrow -- or Congress borrows in our name without ever asking us - and throw at Wall Street, the money sticks up there on the fortieth floor. Then it disappears into that bizarro funhouse mirror of the real economy, the virtual economy - euphemistically called banking and investment and the market. Our market system of "investment" is based upon getting in at the right moment, grabbing other people's money, then getting out fast. Which pretty much describes the key elements a bank heist.

Despite the advice of stock brokers everywhere to think long term, be patient and hold on, the goes to the swift. Consequently, millions of American retirees are still playing bluff poker on eTrade long after the big dogs behind the casino mirrors, the people who can really count cards (because they marked and dealt them), have moved their stakes offshore. As far back as 2000, the big bucks were on the move, away from the fray and sucking more money in their backdraft.

Some people understood at the time that it was a banker rigged game from top to bottom, one that included an elite cadre of players ranging from Wall Street to the Fed, the IMF and the World Bank. Most saw only a few aspects of the global financial growth-bot. But they saw them clearly enough to raise holy hell about it. And were clubbed down in places like Seattle and Miami. When it comes to truth vs. the elite's muscle, there is no contest. In a show of elite muscle, some 3,500 cops were summoned to silence the 2001 Washington D.C. truth tellers. That is one cop for every three protestors at the Anti-capitalist Convergence. Total cost of policing, steel fence and concrete barriers and precautions came to $30 million -- or $37,500 per protestor. I had many friends at that protest, and I cannot think of one who would not have stayed home for half that amount.

Pretending the thrill ain't gone

What would happen if America had leadership that stood up and coolly, intelligently described the economic and ecological peril we face, both of which are completely interrelated. What would happen if a president told the people, "What we have been doing has obviously not been working [they'd sure as hell agree on that], so we are going to have to remake America to save it, and it's going to mean real sacrifice." And what if he could do so without capitalist forces sending out ideological swiftboats to blow him out of the water, or launching hate campaigns against him, branding him as an evil fascist eco-socialist, or whatever.

I dare say the number of Americans who would respond, be willing to sacrifice and meet a challenge issued by cohesive, focused leadership, might surprise us. They might well do it, if for no other reason than that Americans are the most authority worshiping people on earth, outside of North Korea. The reasons why we will never hear a president or a cooperative congress say those things are manifold more than the reasons to believe that we will one day hear it.

Maybe next time - even though there can be no next time in the usual sense, because the rip-off is in and it is total - we will choose better. The planet and the resource base that creates all wealth is pretty much shot, or soon will be. Over six billion people, otherwise known as the masses - though we are not allowed to use that commie term in America - are closing in to finish off what is left.

America and the industrialized world as we have known it are unrecoverable. Some of us find a certain kind of regrettable justice in that. There will be no recovery, but there will be numerous manufactured illusions of recovery . . . . Deny the obvious limits of the earth's sustenance, dry hump the ghost of a sick and unjust prosperity and pretend the thrill ain't gone.

------

What little will remain of sustenance on the planet will have to be distributed by the state, simply to prevent riots and warlordism; but not until the nations have finished warring against one another for resources. What kind of state we end up with between now and species extinction, will be determined by the quality of our own character, the courage and moral stamina of the people.

Turn off your computer, go outside, and look around you. Everything looks normal, doesn't it? Because everyone's average opinion of everyone else's average opinion is that things will somehow work out. We've placed out bets, and then gone about business as usual, safe in the belief that sooner or later there will be a recovery, a return to things as they were. Most Americans assume that, yes, everything will be OK.

Which is exactly why it will not.

Anyway, I'm sitting down here in Mexico thinking about how the inspection sticker on my old red truck ran out back in February. Why I should be worrying about that when I have half a bottle of tequila and a pile of limes in the refrigerator, is beyond me. Once a fearful child of the empire's many rules, always one, I suppose. In about a month, I'll have to go back to the States to do my income taxes. While I'm there I will sneak the truck across town and get Gunther to slap a sticker in the poor beast, bald tires and all. And Gunther, sure as hell will insult me. And I will get off cheap once again, in the empire that insults me more than Gunther ever will.

My inspection sticker ran out at the same time as Joe's and I don't even have the comfort of using the excuse of being in Mexico to bemoan my inability to get another one easily.

I asked Mr. Spock if there was anything we could do to keep them occupied and off our scent. Lucky for us, there's no getting rid of Mike Whitney (emphasis marks added - Ed.):

The Next Big Bailout is on the Way - Prepare To Get Reamed
Housing is on the rocks and prices are headed lower. That's not the consensus view, but it's a reasonably safe assumption. Master illusionist Ben Bernanke managed to engineer a modest 7-month uptick in sales, but the fairydust will wear off later this month when the Fed stops purchasing mortgage-backed securities and long-term interest rates begin to creep higher. The objective of Bernanke's $1.25 trillion program, which is called quantitative easing, was to transfer the banks "unsellable" MBS onto the Fed's balance sheet. Having achieved that goal, Bernanke will now have to unload those same toxic assets onto Freddie and Fannie. (as soon as the public is no longer paying attention). Bernanke's cash giveaway has helped to buoy stock prices and stabilize housing, but market fundamentals are still weak. There's just too much inventory and too few buyers. Now that the Fed is withdrawing its support, matters will only get worse. Of course, that hasn't stopped the folks at Bloomberg from cheerleading the nascent housing turnaround. Here's a clip from Monday's column:
"The U.S. housing market is poised to withstand the removal of government and Federal Reserve stimulus programs and rebound later in the year, contributing to annual economic growth for the first time since 2006. Increases in jobs, credit and affordable homes will help offset the end of the Fed’s purchases of mortgage-backed securities this month and the expiration of a federal homebuyer tax credit in April. Sales will rise about 6 percent this year, and housing will account for 0.25 percentage point of the 3.6 percent growth, according to forecasts by Dean Maki, chief U.S. economist for Barclays Capital in New York . . . “The underlying trend is turning positive,” said Bruce Kasman, chief economist at JPMorgan Chase & Co. in New York.
Just for the record; there has been no "increases in jobs". It's baloney. Unemployment is flat at 9.7 percent with underemployment checking-in at 16.8 percent. There's no chance of housing rebound until payrolls increase. Jobless people don't buy houses. Also, while it is true that the federal homebuyer tax credit did cause a spike in home purchases; it's impact has been short-lived and sales are returning to normal. It's generally believed that "cash for clunker-type" programs merely move demand forward and have no meaningful long-term effect. So, it's likely that housing prices - particularly on the higher end - will continue to fall until they return to their historic trend. (probably 10 to 15% lower) That means more trouble for the banks which are already using all kinds of accounting flim-flam ("mark-to-fiction") to conceal the wretched condition of their balance sheets. Despite the surge in stock prices, the banks are drowning in the losses from their non-performing loans and toxic assets. And, guess what; they still face another $1 trillion in Option ARMs and Alt-As that will reset by 2012. it's all bad. The Fed has signaled that it's done all it can to help the banks. Now it's Treasury's turn. Bernanke will keep the Fed funds rate at zero for the foreseeable future, but he is not going to expand the Fed's balance sheet anymore. Geithner understands this and is working frantically to put together the next bailout that will reduce mortgage-principal for underwater homeowners. But it's a thorny problem because many of the borrowers have second liens which could amount to as much as $477 billion. That means that if the Treasury's mortgage-principal reduction plan is enacted; it could wipe out the banks. Here's an excerpt from an article in the Financial Times which explains it all: "A group of investors in mortgage-backed bonds dubbed the Mortgage Investors Coalition (MIC) recently submitted to Congress a plan to overhaul the refinancing of underwater borrowers by writing down the principal balances of both first and second mortgages. The confederation of insurers, asset managers and hedge funds hope to break a logjam between Washington DC and the four megabanks with the most exposure to writedowns on second lien mortgages, including home equity lines of credit. The private sector initiative coincides with House Financial Services Committee Chairman Barney Frank’s open letter dated 4 March to the CEOs of the banks in question – Bank of America, Citigroup, JP Morgan Chase and Wells Fargourging them to start forgiving principal on the second lien loans they hold. But the banks are unlikely to take action until they get new accounting guidance from regulators that would ease the impact of such significant principal reductions on their capitalization ratios." (Ed.-"Accounting guidance"? Either the banks are holding out for a bigger bailout or they're looking for looser accounting standards to conceal their losses from their shareholders. Either way, it's clear that they're trying to hammer out the best deal possible for themselves regardless of the cost to the taxpayer.) Financial Times again: "The four banks in question collectively own more than USD 400bn of the USD 1trn in second lien mortgages outstanding. BofA holds USD 149bn, Citi holds USD 54bn, JP Morgan holds USD 101bn and Wells Fargo holds USD 115bn, according to fourth quarter 2009 10Q filings with the Securities & Exchange Commission. As proposed, the MIC’s plan entails haircuts to the first and second lien loans to reduce underwater borrowers’ loan to value ratios to 96.5% of current real estate market prices, according to two sources close. For the program to work, HAMP would place principal balance forgiveness first in the modification waterfall. The associated second lien would take a principal balance reduction but remain intact through the process - ultimately to be re-subordinated to the first lien, the sources close said. A systemic program to modify second lien mortgages called 2MP does exist but Treasury has stalled on implementation because the banks that hold them can’t afford it, six buyside investors said. The sources all said implementation of the program, called 2MP, would result in “catastrophic” losses for the nation’s four largest banks, which collectively hold more than USD 400bn of the USD 1trn in second lien mortgages outstanding." ("Mortgage investors push for banks to write down second liens", Allison Pyburn, Financial Times) Hold on a minute! Didn't Geithner just run bank "stress tests" last year to prove that the banks could withstand losses on second liens? Yes, he did. And the banks passed with flying colors. So, why are the banks whining now about the potential for "catastrophic" losses if the plan goes forward? Either they were lying then or they're lying now; which is it? Of course they were lying. Just like that sniveling sycophant Geithner is lying. According to the Times the banks hold $400 billion in second lien mortgages. But - as Mike Konczal points out - the stress tests projected maximum losses at just "$68 billion. In other words, Geithner rigged the tests so the banks would pass. Now the banks want it both ways: They want people to think that they are solvent enough to pass a basic stress test, but they want to be given another huge chunk of public money to cover their second liens. They want it all, and Geithner's trying to give it to them. Wanker. And don't believe the gibberish from Treasury that "they have no plan for mortgage principal reductions". According to the Times: “Treasury continues to tell investors that any day now they will be out with a final program and they will be signed up"....“The party line continues to be they are a week away, two weeks away,” the hedge fund source said. ” So, it's not a question of "if" there will be another bank bailout, but "how big" that bailout will be. The banks clearly expect the taxpayer to foot the entire bill regardless of who was responsible for the losses. So, let's summarize: 1 - Bank bailout #1 - $700 billion TARP which allowed the banks to continue operations after the repo and secondary markets froze-over from the putrid loans the banks were peddling. 2 - Bank bailout #2 - $1.25 trillion Quantitative Easing program which transferred banks toxic assets onto Fed's balance sheet (soon to be dumped on Fannie and Freddie) while rewarding the perpetrators of the biggest financial crackup in history. 3 - Bank bailout #3 - $1 trillion to cover all mortgage cramdowns, second liens, as well as any future liabilities including gym fees, energy drinks, double-tall nonfat mocha's, parking meters etc. ad infinitum. And as far as the banks taking "haircuts"? Forget about it! Banks don't take "haircuts". It looks bad on their quarterly reports and cuts into their bonuses. Taxpayers take haircuts, not banksters. Besides, that's what Geithner gets paid for - to make sure bigshot tycoons don't have to pay for their mistakes or bother with the niggling details of fleecing the little people. The next big bailout is on the way. Prepare to get reamed!
Read it all (if you have the stomach for it). And I am not overreacting. Suzan ______________

6 comments:

Dave Dubya said...

Wow. Since War is Peace, Freedom is Slavery, and Ignorance is Strength, then Squalor is Prosperity.

So I guess we have nothing to worry about.

Suzan said...

You're quick, Dave.

But I've just started restudying my catechism.

I think I've got a headstart on the squalor.

Thanks for jumping in, oh brave one.

S
____________

Beekeepers Apprentice said...

Dead for seven years according to very well-informed sources and yet "Johnny on the Spot" whenever needed for a fresh dose of fear for a barely sentient electorate.

I'm glad I'm not the only one on the net saying this. Every time I say it, people think I'm nuts. But didn't Bush himself say it about 7 years ago when he declared Bin Laden no longer the prime objective? Yes, methinks he did.

Suzan said...

Nuts?

Not you, girlfriend.

Hell. I thought everyone knew it, and when Dumbya practically admitted it so long ago (yes, I remember it well), I couldn't believe how the news fraternity ignored his words like he was a "librul" talking. No follow up from the well-paid pseudo-journalists as usual.

The guy was known to have gone to an American hospital for kidney failure before 9/11 for Christ's sake (it was a matter of the unreported on public record), which made me and many other folk just a little bit suspicious when he, an ex-CIA employee, was deemed the main force behind the 9/11 chain of events.

So go figure - but don't work up too much of a sweat. They aren't even trying that hard anymore.

Don't need to with all the unquestioning sheeple.

Thanks for commenting!

S
___________

Greendayman said...

Great Article Suze. A seven course extravaganza of corruption and manipulation. Yup - let Texas write the schoolbooks, let Fox News lead the ratings and let the American public remain the most entertained and least informed people in the western world. Sad.

It doesn't have to be this way, but until the media changes - this is what we have.

Oh, and New Zealand isn't going to work. Too conservative. -g

Suzan said...

Thanks, g, but I am not entertained by their shenanigans.

Dang! I was hoping NZ would work.

How about Italy (No. 1 in healthcare) or France (No. 2)?

I speak a smidgen of both languages.

heh heh

S