Sunday, July 10, 2011

DustBowl Time Returns? Why Countries Commit "Imperial Suicide" - July Employment Chasm: Getting Used to Life Without Food

I think highly of Bill Bonner's opinions. So does my buddy Coyote Prime. And even though I also agree with Paul Krugman that you do not worry about the deficit during an historic jobs meltdown (you need to CREATE JOBS FIRST), I do think that you've GOT TO STOP THE BLEEDING. The way to do that logically is halt the trillions of dollars thrown away on military-enriching entity's wars and tax the people/businesses that made out like bandits when their taxes were cut and they NEVER CREATED JOBS (except overseas) on a scale grand enough to justify the taxpayer largesse (wasted money that could have been spent actually strengthening the nation in many other ways).

But that's just me.

Did you see yesterday's surprise announcement from our new U.S. Defense Secretary - can you say that phrase without choking? - (or is it the Director of the CIA)? I forget. (Wish I could forget.)

Panetta: US Within Reach of Defeating al-Qaida

Talk about a malignant intelligence/military apparatus. (Please.)

what we see is the whole kit-and-kaboodle of life in the US giving way to desperation, delusion and an irresistible impulse to commit imperial suicide. The economy turns sour. The military becomes malignant. Households are corrupt, bankrupt and dependent. Even the churches sing their hallelujahs to Caesar now. What’s “imperial suicide?” It’s what empires do. If no other empire arises to kill them . . . they kill themselves. China will probably eventually crush the US militarily. But that is far in the future. The US can’t wait. It lets the zombies run wild. At home, Congress debates a “debt ceiling” measure, as if it made any difference. They’ve raised the ceiling 93 times since they first imposed a debt ceiling 94 years ago. What are the odds that they will hold the line this time? Zilch. Instead, they’ll continue borrowing and spending until the nation goes broke. Count on it. The US economy was a free-market success story for a hundred years . . . from the end of the US War Between the States to the end of the Vietnam War. It was the richest, fastest-growing, most innovative, most competitive, and most admired economy in the world. But then, in 1971, Richard Nixon replaced a more-or-less solid dollar, vaguely backed by gold, with a pure paper dollar, backed by nothing but the good intentions of government employees. As the money went, so went the nation. Our friend and colleague Byron King opines: "The problem with the US over the last 40 or 50 years is that there’s too much free money . . . We raise three generations of population who are untied from the basics of monetary education – millions of minds poisoned by Economics 101 in universities across the land. “Elastic currency,” courtesy of the Fed. Media and political classes are no smarter than the dummies who walk the land, so they make policy based on “free” money from the Fed… Deficits don’t matter. Currency circulates and inflates the general price levels… People learn to live with it. Even make a virtue of it, doing things like “buy as much house as you can afford; the market will rise and you’ll make money.” That kind of idiocy. There’s all this excess currency sloshing around the economy, leading to people doing stupid things like drugs, too much alcohol, divorce (Cherchez les femmes), food (obesity), theft, etc… “Wars cost much silver,” wrote Sun Tzu. Lack of money kept a lot of nations out of a lot of trouble over the years. Not any more. Who needs silver when you can just print up bricks of paper cash and fly it over to Iraq and such. Kind of gives a whole new meaning to the term American Exceptionalism… yep, we’re exceptional. That’s for sure. More prisoners in jail than anywhere else. We fight longer wars than anyone else…and don’t win. We give more welfare to more idle people than anywhere else on earth…and we’re proud of it. There’s so much money that we don’t know how to say no. No limits. Just raise the debt ceiling…spend until you can’t spend any more. Then spend some more. Well, there are no limits until there are limits. Per Ayn Rand… “You can avoid reality. But you cannot avoid the consequences of avoiding reality.” In the space of 40 years the US lost its winning ways. Real, hourly wages stopped growing in 1973. Stock prices, in real terms, peaked out in ’99…about the same time that real, per capita private sector growth came to a halt. The number of full time jobs topped out about two years later…and housing hit its peak in 2007. Abroad, US armed forces continue to squander the most magnificent advantage that a military has ever had. The Pentagon spends 7 times as much as the next biggest spender. And it doesn’t even have a worthy opponent. Where does it get the money? It borrows from the Chinese! And what does it do with all that money? It engages in pointless, blood sucking zombie wars. Its three current engagements alone are expected to cost $4 trillion, according to the latest independent estimates – about as much as its trade deficit over the last 10 years. Ask your neighbors. What strategic advantage does the US gain from fighting in Afghanistan, Iraq or Libya? They will have no good answer. Probably some claptrap about ‘fighting terrorism’ is the best they will be able to do; that’s what they were told on TV. A 94-year-old retired Army colonel came over to our house for the 4th of July festivities. A Silver Star winner in WWII, veteran of the Korean War too…we asked what he thought of the Pentagon’s strategy in North Africa and the Middle East. “I am disgusted,” he replied. “Those guys just don’t know what they’re doing. We have no business getting involved in these things…especially in Libya. They’re just traps. I have arguments about it when I go into the VA hospital. The young guys – you know, they’re in their ’80s – are in favor of these wars. Wave the flag. Rah rah…let’s go in and do the job. Teach them a lesson… That sort of thing. But real war is not a football game. And nobody learns anything…except not to do it again.” Who – with the exception of a 94-year-old veteran – objects to squandering the national treasure, blood and honor on these wars? Almost no one. Why not? Because they’ve all drunk deeply from the intoxicating cup of imperial power. An ordinary nation fights wars to protect itself. An empire fights wars because that is what an empire does. And it continues fighting until it finally beats itself. Why didn’t Rome pull back its troops from the Rhine or Anatolia or North Africa…in order to protect its homeland from the barbarians? Why didn’t Alexander retire to Macedonia, while he still had breath? Why didn’t the Germans retreat to the banks of the Oder when they still had the means to resist the Soviet onslaught? Why doesn’t the US bring home its troops, cut its spending, balance its budget and protect its future? Ha…ha…you know the answer. Because the system has been taken over by zombies…people who want to see the spending continue, no matter what the cost. Zombie wars. Zombie social spending. And zombie finance. . . . Here’s an item from the website Gawker that helps understand how the zombies operate: John Cook – "The White House released its annual salary report last week, and as usual, it’s nice to work for Barack Obama: Most staffers who were there for more than a year got a salary bump. A bigger one than you did. The last time we checked in on White House salaries, we found that an astonishing 75% of continuing staffers got raises from 2009 to 2010 – a huge number given the fact that, according to compensation experts, most companies had skipped routine raises that year in reaction to the economic crisis that the White House was busy failing to solve. This time around – from 2010 to 2011 – the ratio is a little less dramatic. Of the 270 White House staffers who have been there for more than a year, 146 – or 54% – received raises. The average salary increase was 8%. If you look at only staffers who got raises, the average increase was twice that. That’s a much bigger raise than the average white-collar worker got. According to a survey conducted last year by the human resources consulting firm Mercer, most firms were projecting a 3% increase in base pay for executives. White House workers did nearly three times as well." One of Obama’s first acts as president was to freeze the salaries of all White House officials earning more than $100,000 because “during this period of economic emergency, families are tightening their belts, and so should Washington.” Two years later, he extended that policy to all federal workers, using the same logic: “Small businesses and families are tightening their belts. Their government should too.” But the across-the-board freeze didn’t take effect until January 1, 2011, so the most recent report (which goes back to July 2010) features some eye-opening raises, like special assistant to the president for economic policy Matthew Vogel’s $59,000, 82% raise to an annual salary of $130,500, or director of African American media Kevin Lewis’ $36,000, 86% pay hike. How about that…a “director of African American media?” On the White House payroll. Just what the country needs."
And you know I'm no racist, but what the hell are they thinking? Cause my guess is it's not "reelection here we come!" (Or maybe they need to assure the minority vote? As it sure as hell isn't coming from people who haven't seen a job in a long time.) From Angry Bear, an absolutely fantastic source of data about the economy (and one of the few who does not lie to us (yet, anyway). And this is the time frame where people will be questioning the progressive leadership before committing to the next election, folks. Don't get MEGO syndrome here. Read the words carefully if you get bogged down by the charts. It's all you need to understand the dire importance of creating jobs first. Get on board!

July Employment Situation

Posted by spencer|7/08/2011
The employment was bad news as payroll employment only rose by 18,000 as compared to the last months disappointing rise of 25,000. Government employment fell 39,000 versus 48,000 in May. Private payrolls expanded only 57,000 that was even weaker than the prior month's 73,000. Over the last two months payroll employment was essentially unchanged. Moreover, the household survey reported an employment drop of -445,000. This lead to the unemployment rate rising to 9.2% Historically the household survey tend to lead the payroll survey and the very poor performance of the household survey is extremely discouraging. In addition the average workweek was unchanged so aggregate hours worked only expanded 0.1% Over the last few months the index of hour worked has been: .........March......... April......... May........ June .........100.5......... 100.7........ 100.7 ..... 100.8You would never know it from listening to the talking heads, but this recovery is actually stronger than the last recovery. Average hourly earnings fell from $19.42 to $19.41. Both the year over year and compound three month growth rate of average hourly earnings is only 1.9%. Wage growth is approaching a record low. Average weekly earnings growth also continues to slow. The year over gain is 2.5% and the three month growth rate is only 1.8%. Actually, with oil prices falling real weekly earnings ticked up month before last, the only gain in seven months. But this month average weekly earnings actually fell from $652.51 to $652.18 so unless we are experiencing deflation real wages will fall again this month. Given this weakness in wages and earnings it is extremely difficult to see where growth is going to come from. Comments: Daniel Becker
Difficult to see where growth is going to come from? You can't see what does not and will not exist. $1.4 trillion per year in the hands of the top 1% no longer in the hands of the other 99%. rapier
Just watch the tax withholdings numbers and there is no need to read the tea leaves about employment. The employment situation has stopped improving. The bad official numbers are not a surprise. The US Labor Market: European Levels Without the European Safety Net Posted by Rebecca Wilder | 7/10/2011 Jobs growth is a lagging indicator of economic activity, so the June report confirms that the US economy has been in a deep rut (Marshall Auerback calls it a 'fully-fledged New York City style pot hole'). Yes, the US economy is growing; but sub-2% really 'feels' like stagnation, if not recession for many. As always, Spencer provides a fantastic summary of the employment report here on AB: 'bad news', he says. I call it abysmal, both relative to history and on a cross section. The chart below illustrates the unemployment rates across the G7 spanning 1995 to 2011. Across the G7 economies, the level of the US unemployment rate is second only to France. This is true on a harmonized basis as well. The speed at which the US unemployment rate reached European levels was abrupt. Only the UK has seen such a swift deterioration in labor market conditions. The chart above illustrates the same time series as in the first unemployment chart, but the rates are indexed to 2005 for comparability. France's high level of unemployment is structural. In contrast, the US level of unemployment is NOT, not even close. The chart above illustrates the components of the OECD's indicators of employment protection. Also, see a short note by the Dallas Fed highlighting the differences between the French and US labor markets (and the 1994 OECD jobs study). The French labor market is quite rigid, which leads to a structurally elevated unemployment rate and expansive unemployment compensation (see this follow up to the OECD 1994 jobs strategy report). The US Labor markets is much more fluid, which is why the unemployment rate has surged relative to comparable economies in Europe (see second chart). European levels of unemployment without the European safety net. The chart illustrates the maximum number of months that a worker can claim unemployment insurance for the year 2007. In normal times, French workers can collect benefits for up to 23 months by law, where the US worker collects for just 6 months. The tax and benefit policies data are updated infrequently, and listed on the OECD's website (excel file link). Seriously, shouldn't Congress be focused on the depressed state of the US labor market, rather than a 'scaled back' version of deficit cutting? Addressing one will clearly impact the other - it goes both ways. Unfortunately, the government's pushing in the wrong direction (cutting deficits brings further unemployment rather (than) reducing unemployment (which) drops the deficits).
David Michael Green is one courageous man in my book and he speaks for all of us in the essay below. Read it all by clicking on the link. (It's priceless!)
. . . in many ways Obama has gone even further than the Bush administration in trampling on people’s rights and very lives in pursuit of the “War on Everything” which now seems to be the modus operandi for American policy, both foreign and domestic. Obama has radically increased the number of drone strikes in Pakistan, wantonly killing civilians there, and he has claimed the right to assassinate American citizens whom he alone deems enemies of the state.

And, oh boy, we do have a lot of enemies under Barack Obama. Liberals were sickened, as they should well have been, when Boy George lied the country into a war in Iraq that had little to do with anything beyond ameliorating his own massive and well-deserved personal insecurities, and when he promulgated a far too vague, misguided and misguiding ‘war on terrorism’, which was of course in fact really a war on anyone who wouldn’t play ball with corporate-controlled Washington, DC.

(Truth be told, tin-pot potentates could use any tactics or weapons they wanted to, or not do so, and that was irrelevant to whether they would end up on the bad guys’ list. It was all about playing ball with the money guys. Ask the once-favored Saddam. Ask Noriega.) In any case, if you put it all together, Bush had us fighting three simultaneous wars, which I’m pretty sure is a personal best, even for a country as addicted to war as America. Or, I should say, it used to be a personal best.

Not to be outdone by a mere actual Republican, Barack Obama has now fully doubled Bush’s prodigious achievement. As Tom Engelhardt reports, we are now fighting “Six Wars and Counting”: “With the latest news that the U.S. has launched a significant ‘intensification’ of its secret air campaign against Yemeni tribesmen believed to be connected with al-Qaeda, the U.S. is now involved in no less than six wars. Count ‘em, if you don’t believe me: Iraq, Afghanistan, Pakistan, Yemen, Libya, and what used to be called the Global War on Terror.” It is, of course, a measure of the sickness of our times that we can be fighting six wars at once. But it is even worse that nobody even particularly notices. And it is truly bizarre that those on the left and those on the right would no doubt agree that liberal Barack Obama runs a much less militarist foreign policy than George W. Bush, even whilst fighting double the number of simultaneous wars. Say what?

Well, okay. Maybe Obama is just a captive of the military-industrial complex like every other American politician, and therefore has no latitude to move on any of these fronts, and blah, blah, blah... (I say that not, in the slightest way, to mock this notion of iron triangle control either in concept or in application. It’s very real and very powerful. It’s just that, what’s the point of being President if you’re not going to do the hard things?).

But at least this progressive President, this socialist chief executive, can move boldly on social issues, right? I mean, we’re talking about stuff where the military doesn’t have a dog in the race, and – most importantly – there are no Wall Street weenies to control the national agenda so that they can purchase their eighth yacht. So, Kapow!, right? Slam! Bash! Isn’t social policy where this presidential product of the civil rights movement can run hard, knees churning high, knocking over any obstacles in his way?

Try again. Here’s another New York Times headline for you, from an editorial last week: “Gay Marriage: Where’s Mr. Obama?” Where, indeed? Ya wanna know where he was while New York was doing something truly historic (if ridiculously overdue)?

Cashing in on the issue without remotely committing to it, that’s where: “On Thursday night, when same-sex marriage in New York State was teetering on a razor’s edge, President Obama had a perfect opportunity to show the results of his supposed evolution on gay marriage. Unfortunately, he did not take it, keeping his own views in the shadows. The next night the Republican-led New York State Senate, of all places, proved itself more forward-thinking than the President on one of the last great civil-rights debates in this nation’s history.

Speaking to the Democratic Party’s LGBT Leadership Council at a fund-raiser in New York, Mr. Obama ran through the many efforts he has made on behalf of gay rights, including his decision to end the government’s legal support of the Defense of Marriage Act, which forbids federal recognition of same-sex marriage. The act should be repealed, he said, since marriage is defined by the states. Mr. Obama’s legal formula suggests he is fine with the six states that now permit same-sex marriage, and fine with the more than three dozen other states that ban it. By refusing to say whether he supports it (as he did in 1996) or opposes it (as he did in 2008), he remained in a straddle that will soon strain public patience. For now, all Mr. Obama promised was a gauzy new “chapter” in the story if he is re-elected, and his views remain officially ‘evolving’.”

Bold Barack. Brave Barack. He’ll come speak moving words to your caucus. You know, shit about “bending the arc of history”, and “we’ll get there together”. He’ll take your money. And then, when it comes to actual policy decisions, where it counts, his position will be so lame that he’ll manage to be outflanked by Republicans, even the thuggish freaks who are more or less the only kind of Republicans there are in 2011. Brilliant. And so liberal.

And about as sadly ironic as it gets. The heterosexual Obama on gay rights – unquestionably the central civil rights issue of our time – reminds me of nothing so much as the Caucasian Dwight Eisenhower or John Kennedy trying to fudge the moral imperative of the African American civil rights movement that was shoved in their faces in the Fifties and Sixties, pathetically splitting hairs, trying to placate their racist constituents while history was happening all around them, much to their chagrin.

Imagine if, by some certain quirk of science fiction, that Barack Obama had been president then. What would he have done, as his own people demanded justice, prosperity, freedom and democratic rights? He would have done what he is doing to gays today. And for that matter, what he is doing for racial minorities today (which is nothing), an issue on which he has been the most silent president of my lifetime. I’m not joking about this. Even if it were his own people whose lives and fortunes and destinies were in the balance, blacks would have gotten Mr. Bigtalk at the campaign fundraiser, but Mr. Laylow in the Oval Office.

Ah, but timidity is far less the issue with Obama than sometimes seems apparent, and that interpretation of the guy’s politics is a fundamental mistake made by most of those Democrats who at least once in a while have the good sense to be disappointed by their President. Think about it. When you’re timid, you don’t fight six foreign wars at one time. You don’t claim the right to assassinate American citizens for their rhetoric. You don’t shred the Constitution.

The thing about Obama that neither Democrats nor Republicans understand is that this guy is fundamentally regressive in his politics. That is the essence of his presidency, though – astonishingly – very few people get that. Look at the litany of issues addressed above. If you honestly asked yourself for each of them what, in the abstract, would a progressive president do, and what would a regressive president do, you can immediately decipher the true nature of Barack Obama. A progressive president wouldn’t triple American forces in Afghanistan and launch three new wars abroad, but a regressive president would. A progressive president wouldn’t out-do Dick Cheney in wrecking the Bill of Rights, but a regressive president would. A progressive president wouldn’t follow behind the lead of Republicans on civil rights issues, but a regressive president would.

And that’s just what this regressive president has done, all down the line. Never mind that we’re just getting started here. We could go on and on with this, issue after issue. What do you think a regressive president would do about the planetary nightmare of global warming? Nothing, perhaps? Gee, does that sound familiar? How about giving out unprecedentedly gigantic oil tracts off the Atlantic coast? Or multiple rounds of additional tax cuts for the ultra-wealthy? Hey, where have I heard that before?

Even Obama’s signature ‘liberal’ issue, his health care plan, was just dandy from the perspective of the insurance industry, with whom he cut a deal at the very beginning of the legislative process. I’m sorry, but if those guys are happy with the bill (maybe – I’m just wildly guessing here – because it forces about 35 million people to buy their expensive and useless product?), what does that tell you about the legislation, and about the president who crafted it?

Democrats are stupid about this. They still mostly like Obama, to the tune of about 75-80 percent job approval, though they might grumble here and there about this or that perceived failing of the president’s. It is a measure of their abysmally low standards and our pathetic national political discourse that policies like Obama’s can satisfy his base, so much so that he won’t even face a primary challenger from his left.

We saw the same thing with Clinton as well, who first sold out the party of the New Deal and Great Society. Idiotic Democrats still adore Clinton to this day, not realizing that he was more Reagan than Reagan when it comes to economic policy, including the deregulation of banks that created the current deluge under which so many non-elite Americans are drowning, while the rich are fatter than ever.

These attitudes are also a measure of bias as well, or what one might describe as a sort of political tribalism of the uninformed. On the rare occasion where you might hear an exasperated Republican say of Obama’s supporters, “If George Bush did the exact same thing, they’d string him up for it”, he or she has got it right. As clearly demonstrated above, Obama actually out-Bushes Bush in many areas – imagine, if you can do so without hurling, what a Dick “Dick” Cheney presidency might have looked like and yet brain-dead Democrats still support their guy.

Why? I suppose some of it is because he’s black. And some of it is because he’s young and articulate and energetic and photogenic. Mostly, though, I think it’s because he’s a Democrat, and people are so tuned out from public affairs – despite what public affairs policy decisions are doing to their lives right now – that they simply go with that in-group vs. out-group rubric: “Democrat good, Republican bad”. Chances are they got that from their families and communities, along with their religion and nationalism and so on. Of course, to a certain extent, one of the key functions of political parties has always been simply to serve as precisely that sort of short-hand. Don’t know who Smedley Goodfinger is, the candidate for local dog catcher? That’s fine, just check his party label and vote accordingly.

But there is a point at which such guiding assistance can cross a line into negligent laziness. More importantly, as in our time, there is a very real danger that today’s Democrat is far from being your father’s Democrat. At which point, using party labels to make otherwise blind decisions about politics becomes not just laziness or negligence, but complicity in a crime. And a crime where you’re one of the victims, no less.

We have been at that point since at least 1992 – and arguably 1976 – when “New Democrats” threw the program of FDR and LBJ overboard, but continued to benefit from the inertial habits of well-trained traditional Democratic voters.

Bill Clinton was, historically speaking, every bit as great a national disaster, if not greater, than Ronald Reagan. At least with Reagan you had a clearer sense of his real politics and values. What Clinton and now Obama have been successful at doing is getting Democrats to support them while nevertheless running policies that favor the same plutocratic constituencies as a Reagan or a Bush would. Let’s be honest, individuals like Geithner and Summers and Rubin could have just as easily served in a Republican administration as a Democratic one, and their policies would have fit just as well. Or look at Bob Gates, who not only could have done this, but in fact did.

In short, Democratic support and defense of Barack Obama is a sad joke. This guy is no liberal. He is, in fact, using liberal votes to join the Gingriches and Cheneys and Palins of this world in the project of destroying liberalism and its great achievement of massively widening the middle class and sharing national prosperity. Hey, not a bad gig, if you don’t mind the whole cynicism part, and the whole spending eternity in Hell thing.

Republican haters of Obama are every bit as guilty of negligent laziness, of course, but for them there is an added element of sickness. They could never admit it, but one simply cannot dismiss all the rhetoric of foreignness and other forms of fundamental illegitimacy they revel in when it comes to Obama. You know... He wasn’t really born here. He’s a secret Muslim. He’s a socialist. He’s going to take away our guns. He’s not really an American. He bows to foreign princes. He hates America and its core values. He goes around the world apologizing for his country. He’s actually really dumb, and can only sound intelligent because he uses a teleprompter. His health care bill is a nefarious plot to kill off grannies.

This shit is so stupid it’s embarrassing. Or, it would be, if the folks trading in these tropes were capable of embarrassment. Beyond the fact that they, like Democrats, are unable to decipher Obama’s obvious political commitments with the slightest degree of accuracy, despite the plainness of these for all the see, Republicans add to the mix their equally transparent personal insecurities when it comes to Obama. It’s not just that he’s black and sitting in their White House (though, now that you mention it, that’s not right!), or that he’s a Democrat that bothers them.

What makes them go ballistic is that he is so clearly more mature and responsible in his mien. That undermines their license to be reckless and irresponsible – and to favor national policies that are the same – with impunity. That’s what they loved so much about Bush, and what the codes words of “the politician you’d most like to have a beer with” really meant. It’s the guy who doesn’t threaten your greed and laziness and prejudice and stupidity, as Obama kinda does. It’s the guy who doesn’t make you think, the guy who provides political cover for your worst instincts.

I think that’s the real reason why regressives hate Obama so, despite the fact that his politics are exactly their politics – yes, even including the extravagant spending, where Obama is merely replicating the crimes of Reagan and Bush, though for slightly more defensible reasons.

It’s not a good sign when so many people – basically all of us – have politics which are so flat-out wrong. And if these feel like the worst of times politically in America, that is not such an exaggerated perception, notwithstanding the country’s more overt crises throughout the past two or three centuries. There are significant differences now, however. One is that the national trajectory is manifestly downward, really for the first time ever in US history.

Another is that our body politic is so diminished that it can no longer recognize basic political facts anymore. Nothing is more emblematic of that than the case of Barack Obama. Democrats love him for being a good old liberal Democrat. Republicans hate him for the same reason. Both are so politically dumbed-down that neither can recognize how absurdly wrong they are on such a central question as the politics of the country’s chief executive.

But, of course, the biggest single problem facing the polity is that nobody is talking about the biggest single problem facing the polity. The country has been hijacked by hyper-greedy elites, who have demonstrated that there is absolutely no bottom to what they are willing to do to the rest of us, and to the country, to milk it and bilk it of every last remaining penny of value.

There have always been people like that, of course, but where in the past they have been effectively countered by those with a sensible and public-oriented agenda, no such beast exists anymore, at least outside of Vermont and one or two odd congressional districts. Your choice at the ballot box today will be between a Democrat who bends you over and screws you with a smile and a modicum of foreplay first, or a Republican who dispenses with such niceties and just gets the job done, to the glee of every insecure cracker cheering from the sidelines, not realizing which end of the pelvic thrust he himself is actually on as well.

But that’s not actually the worst news. If you think about it, every disaster facing the country today has been a product of insane right-wing politics deployed over the last thirty years. But, truly remarkably, every such disaster has then produced public acquiescence, if not support, for a yet more regressive response to address the mess made by the initial one (what was it that Einstein said about the literal definition of insanity?).

Keep that in mind while contemplating the fact that our current trajectory is completely unsustainable. Bad conditions are about to get much worse.

Given such a track record, which way do you think the American public will be turning when the shit really hits the fan?

Yeah, me too.

Just because it's important, I thought I'd run a lot of the following extremely attention-riveting essay about exactly what has happened to the US economically over the last 30 years (of which most of us are unaware), and about which we are going to need to do something very important pretty soon. It also explicates pretty thoroughly how bumfuzzled the U.S. population has been in regards to its continuing well-being if not existence. Take it for what it's worth to you, friends. (And isn't it finally good to know the reason why Tim Geithner's "lack of paying taxes" problem was no problem with his being Treasury Secretary for Obama (or getting confirmed by the Senate)? Or that Henry Kissinger was and is clearly an evil man who benefitted monetarily as well as politically from the pauperization of others? And try your darndest not to think of Hillary's windfall commodity trading "gains" as you read why below (and how they got the millions for that lovely wedding - which most decent people would have been ashamed to show off to the public) - and keep in mind how "beneficial to their wise policies" the lack of investigative reporting available was then (and now). And no wonders left that GOLDMEN RULE - also why they all got bonuses (Hint: They were "smarter" than you think). And why the ENRON loophole will be the hole of infamy for our economy from now on if we don't throw the buggers out (and kill Kenny Boy Lay for real).)
Getting Used to Life Without Food Wall Street, BP, Bio-Ethanol and the Death of Millions By F. William Engdahl Global Research July 3, 2011 My late grandfather, a man of sturdy Norwegian-American farm stock, who later became a newspaper editor and political activist during the First World War, used to say, 'A man can get used to pretty much anything with time, except dying...and even that with some practice.' Well, as fate has it, it seems we, the vast majority of the human race, are about to test that adage in regard to the availability of our daily bread itself. Food is one of those funny things it's hard to live without. We all tend to take it for granted that our local supermarket will continue to offer whatever we wish, in abundance, at affordable prices or nearly so. Yet living without adequate food is the growing prospect facing hundreds of millions, if not billions, of us over the coming years. In a sense it's a genuine paradox. Our planet has everything we need to produce nutritious natural food to feed the entire world population many times over. This is the case, despite the ravages of industrialized agriculture over the past half century or more.

Then, how can it be that our world faces, according to some predictions, the prospect of a decade or more of famine on a global scale? The answer lies in the forces and interest groups that have decided to artificially create a scarcity of nutritious food. The problem has several important dimensions.

Eliminating Emergency Reserves

The ability to manipulate the price of essential foods worldwide at will - almost irrespective of today’s physical supply and demand for grains - is quite recent. It is also scarcely understood.

Up until the grain crisis of the mid-1970s there was no single "world price" for grain, the benchmark for the price of all foods and food products. Grain prices were determined locally in thousands of market places where buyer and seller met. The onset of economic globalization was to change that radically to the worse as the tiny percent of grains traded internationally were able to set the global price for the bulk of grains grown.

From the time of the earliest traces left by Sumerian civilization some two thousand years before Christ, in the region between the Tigris and Euphrates rivers in today's Iraq, almost every culture had the practice of storing a reserve stock of a grain harvest – right up to the most recent times. Wars, droughts and famines were the reason. When properly stored, grain can be safely stored over a period of about seven years, enabling reserve stocks in case of an emergency.

After the Second World War, Washington created a General Agreement on Tariffs and Trade (GATT) to serve as a wedge to push free trade among major industrial nations, especially the European Community. During initial negotiations, agriculture was deliberately kept off the table at the insistence of the Europeans, especially the French, who regarded political defense of Europe’s Common Agriculture Policy (CAP) and European agriculture protections as non-negotiable.

Beginning in the 1980s with the political crusades of Margaret Thatcher and Ronald Reagan, the extremist free market views of Chicago's Milton Friedman became increasingly accepted by leading European power circles. Step-by-step the resistance to the Washington agriculture free trade agenda dissolved.

After more than seven years of intense horse-trading, lobbying and pressure, the European Union finally agreed in 1993 to the GATT Uruguay Round, requiring a major reduction of national agriculture protection. Central to the Uruguay Round deal was agreement on one major change: national grain reserves as a government responsibility were to be ended.

Under the new 1993 GATT agreement, formalized with the creation of a World Trade Organization to police the agreements with enforceable sanctions against violators, ‘free trade’ in agriculture products was for the first time an agreed priority of the world's major trading nations, a fateful decision to put it mildly.

Henceforth, grain reserves were to be managed by the ‘free market,’ by private companies, greatest among them the US Grain Cartel giants, the behemoths of American agribusiness.That ill-advised decision would open the floodgates to unprecedented grain market shenanigans and manipulations. The grain companies argued that they would be able to fill any emergency gaps more efficiently and save governments the cost.

ADM (Archer Daniels Midland), Continental Grain, Bunge and the primus inter pares, Cargill—the largest privately-held grain and agribusiness trading company in the world—emerged the great winners of the WTO process.

The outcome of the GATT agriculture talks was very much to the liking of the people at Cargill. That was no surprise to insiders. Former Cargill executive Dan Amstutz played the key role in drafting the agriculture trade section of the GATT Uruguay Round.

In 1985 D. Gale Johnson of the University of Chicago, a colleague of Milton Friedman, co-authored a seminal report for David Rockefeller's Trilateral Commission that was the blueprint for what they called "market-oriented" agricultural reform. It provided the framework for the US position in the coming GATT Uruguay Round negotiations. The Rockefeller group and its think tanks were the architects of ‘agricultural reform,’ as with so much in our post-1945 world.

The process of eliminating government grain reserves in major producing countries took time, but with the passage of the 1996 Farm Bill, the US had virtually eliminated its grain reserves. The EU followed soon after. Today, among major agriculture producing countries, only China and India still hold to a strategic security policy of nationally held grain reserves.

Wall Street Smells Blood

The elimination of national grain reserves in the USA and EU and other major OECD industrial countries set the stage for the next step in the process—elimination of agricultural commodity derivatives regulation, allowing unbridled unchecked speculative manipulations.

Under the Clinton Treasury (1999 – 2000) the deregulation of government controls over agriculture commodity speculation was formalized by the Commodity Futures Trading Commission (CFTC)—the government body charged with supervising derivatives trade in exchanges such as the Chicago Board of Trade or NYMEX— and in legislation drafted by Tim Geithner and Larry Summers at Treasury. As described below, it was no accident that Wall Street pushed Geithner, former President of the NY Federal Reserve, to become Obama’s Treasury Secretary in 2008, amid the worst financial debacle in history. Something to do with having foxes guard henhouses.

When Henry Kissinger was Secretary of State in 1972-1973, acting in league with the Department of Agriculture and major US grain trading companies, he orchestrated an unprecedented 200% jump in the price of grain. The price hike was triggered at that time by the US signing a three-year contract with the Soviet Union that had just gone through a disastrous harvest failure.

The US-Soviet deal hit amid global drought and severely reduced harvests worldwide, hardly a prudent time to sell the entire US grain cupboard to an ostensible Cold War opponent. The sale took place amid a major world grain harvest shortfall leading to the explosive price rise. Critical voices in US press at the time appropriately dubbed it the Great Grain Robbery. Kissinger had even arranged for much of the cost of shipping US grain to the Soviets to be paid by US taxpayers. Cargill and company laughed all the way to the bank.

Around the same time, the big American grain companies—Cargill, Continental Grain, ADM, Bunge—began what would be a twenty-year process of transforming world grain markets into venues for controlling essential human and animal nutrition by manipulating grain prices regardless of supply.

The twenty-year process of the US’ gaining control of world grain markets and prices took a giant leap forward in the 1980s with the advent of financial commodity index trading and other derivatives.

The Summers-Geithner-Wall Street new version of the earlier grain robbery especially after 2006 would eventually pale anything Kissinger and friends had engineered in the 1970s.

In 1999, at the urging of major Wall Street banks such as Goldman Sachs, JP Morgan, Chase Manhattan and Citibank, the Clinton Administration drafted a statute that would fundamentally alter grain-trading history. It was called the Commodity Futures Modernization Act and was made law in 2000.

The two key architects of Clinton’s new law were a former Goldman Sachs consultant and Clinton’s Treasury Secretary Larry Summers, and his Assistant at Treasury Tim Geithner, friend of Wall Street and today Obama’s Treasury Secretary. Secretary Summers was also a key player in preventing efforts to regulate financial derivatives in commodities and financial products.

The Summers-Geithner recommendations were contained in a November 1999 Report to Congress from the President's Working Group on Financial Markets, the infamous "Plunge Protection Team."

At the time, the Commodity Futures Trading Commission (CFTC) proposed also to deregulate trading in derivatives between major banks or financial institutions, including derivatives of grain and other agricultural commodities.

The historic and unprecedented deregulation opened a massive hole in Government supervision of derivatives trading, a gaping hole that ultimately facilitated the derivatives games leading to the 2007 financial collapse. It also formed the deregulation free-for-all that is behind much of the recent explosion in grain prices.

Some years earlier in 1991 Goldman Sachs had rolled out its own commodity "index," which was to go on to become the global benchmark for derivatives trading of all commodities, including food and oil. The Goldman Sachs Commodity Index or GSCI was a new derivative that tracked the prices of some 24 commodities - from corn to hogs to coffee to wheat to precious metals and energy. From the point of view of Wall Street, the idea was brilliant. It let speculators gamble on the future price of an entire range of raw materials in one step, a kind of Wall Street version of a “one-step” gambling mall...

With the CFTC deregulation of commodity trading in 1999 Goldman Sachs was positioned to reap sweet financial rewards with its GSCI. Now bankers and hedge funds and other high-profile speculators were able to take huge positions or bets on the future grain price with no need to take delivery of actual wheat or corn at the end.

The price of grain was now run by the new casino masters of grain supplies - from Wall Street to London and beyond - who traded grain futures and options in Chicago, Minneapolis, Kansas City. No longer was future price a form of hedging limited to knowledgeable active participants in the grain industry, whether farmers or millers or large grain end-users – the individual traders who had relied on futures contracts for more than a century to insulate themselves from risks of harvest failure or disasters.

Grain had become a new speculative field for anyone willing to risk investors' capital, high stakes gamblers such as Goldman Sachs or Deutsche Bank or high-risk offshore hedge funds. Grain, like oil before it, had now been almost entirely decoupled from everyday supply and demand in the short term. The price could be manipulated for brief periods through rumor rather than fact.

Unlike directly involved parties like millers or farmers or large restaurant chains, speculators neither produced nor took delivery of the corn or wheat they gambled with. They could hardly take delivery of 10 tons of hard red winter wheat and store it. Their game was a complex new form of arbitrage where the only rule was to buy low and sell high. Derivative instruments and US Government laissez faire regulatory negligence allowed the players’ potential profits from the game to be leveraged often many-fold.

But there was another perverse twist: Goldman Sachs' GSCI was structured so that investors could only buy the contract. It was, as the industry calls it, "long only." No one could bet on a fall in grain prices with it. You only stood to profit from an ever-rising grain price and that happened as ever more innocent investors were suckered into high-risk commodity speculation creating a kind-of self-fulfilling prophesy.

That long-only feature was done to encourage bank clients to leave their money with the bank or fund for the long term and let the bankers play with other people’s money, with huge potential windfall profits to the bankers - while any losses fell to the clients.

The fatal flaw was that the GSCI structure did not allow "short selling" that would force prices down in times of grain surplus. Investors were lured into a system that required them to buy and keep buying once grain prices rose for whatever reason. Soon other banks, including Barclays, Deutsche Bank, Pimco, JP Morgan Chase, AIG, Bear Stearns, and Lehman Brothers, floated their own commodity index funds.

For the first time, high-risk commodity investing - including into grain and other agriculture products - became a financial product for the "little man" who knew little if anything about what he was getting into, just that his banker or fund adviser was urging him to invest in it. The banks as usual played with "other people’s money" – at the expense of ‘other people.’

In a detailed analysis of the grain price bubble of 2007-2008, Olivier de Schutter, a UN Special Rapporteur on the Right to Food, recently concluded that "a significant portion of the increases in price and volatility of essential food commodities can only be explained by the emergence of a speculative bubble."

The timing of that bubble was notable as it conveniently offset huge losses of those same mega-banks that were under water with their excesses in securitized home mortgages and other Wall Street casino madness. Schutter added,

In particular, there is a reason to believe that a significant role was played by the entry into markets for derivatives based on food commodities of large, powerful institutional investors such as hedge funds, pension funds and investment banks, all of which are generally unconcerned with agricultural market fundamentals. Such entry was made possible because of deregulation in important commodity derivatives markets beginning in 2000.

Following the collapse of the stock bubble in 2000, as Wall Street and other major financial players began seeking alternatives, commodities and high-risk derivatives based on baskets of commodities became a major speculative investment theme for the first time.

Since 2000 the totality of dollars invested in various commodity index funds - Goldman Sachs’ GSCI being the largest - has risen from some $13 billion in 2003 to a staggering $317 billion during the oil and grain speculation bubble in 2008. This was documented in a study by Lehman Brothers shortly before Treasury Secretary Henry Paulson made them a sacrificial lamb in order to bail out his Wall Street cronies.

Since 2008 with some fluctuation, investor funds have continued to pour into various commodity funds, keeping food prices high and rising. From 2005 to 2008, the worldwide price of food rose 80 percent - and has kept rising. In the period from May 2010 through May 2011 the price of wheat rose again some 85%. "It's unprecedented how much investment capital we've seen in commodity markets," said Kendell Keith, president of the National Grain and Feed Association, in a recent interview.

The Food and Agriculture Organization of the UN estimates that since 2004, world food prices on average have soared by an unprecedented 240%. The offering of food commodities as a speculative alternative by the large banks and hedge funds exploded in 2007 when the US sub-prime financial tsunami first hit. Since then, speculation in food commodities has only gathered more momentum as other investments in stocks and bonds became highly dangerous. One result has been a predictably rapid rise in starvation, hunger and malnutrition in poorer populations around the world.

The FAO calculates that food-deficit countries will be forced to spend fully 30% more on importing food - with a world value of a staggering $1.3 trillion. Three decades ago, that international market was tiny; today it is overwhelmingly dominated by a small handful of US agribusiness giants. Agribusiness, like military exports, is a core US strategic sector, long supported to extraordinary lengths by Washington. It is part of a larger and rather private agenda shaped decades ago under the aegis of the Rockefeller and Ford Foundations and their eugenics advocates.

Importing food is today the rule rather than the exception as cheap, globalized agribusiness products, often under IMF pressure, are being forced onto populations across the developing world, including formerly self-sufficient food-producing societies now rendered dependant on imported food. This is done in the name of ‘free trade’ or what is often called ‘market-oriented agriculture.’ Left unsaid is that the so-called ‘market’ is colossally inefficient and unhealthy, literally and financially. Imported food dependency is artificially created by huge multinational conglomerates such as Tyson Foods, Smithfield, Cargill or Nestle, corporate giants whose last concern seems to be the health and well-being of those of us who must consume their industrial food products.

The cheap agribusiness imports often undercut the prices of locally grown crops, driving millions from their land into overcrowded cities in desperate search of jobs.

Today the price of wheat derivatives, or ‘paper wheat,’ controls the price of real wheat as speculators like Goldman Sachs, JP Morgan Chase, HSBC, Barclays or numerous offshore hedge funds - with little interest in grains other than as a profit source - now outnumber bona-fide agriculture industry hedgers four-to-one.

That is a complete reversal of the situation that dominated grain prices for the past hundred years or more. For some 75 years, the CFTC had imposed limits on how much of certain agricultural commodities - including wheat, cotton, soybeans, soybean meal, corn, and oats - can be traded by non-commercial players who are not part of the food industry. So-called ‘commercial hedgers,’ like farmers or food processors, previously could trade unlimited amounts in order to manage their risk. Not so with pure speculators.

Those limits were designed to prevent manipulation and distortion in what are relatively small markets. With the passage of the Summers-Geithner Commodity Modernization Act of 2000 and the infamous ‘Enron Loophole’ - allowing exemption from government regulation - the fast and loose trading in energy derivatives was rapidly expanded to include food commodities. The dam broke in 2006 when Deutsche Bank asked for and was granted CFTC permission to be exempt from all trading limits. The regulatory authorities assured them that there would be no penalties for exceeding the limits. Others followed, lemming like.

For some two billion people in the world who spend more than half of their income on food, the effects have been horrifying. During the speculation-driven grain price explosion in 2008, more than a quarter billion people became what the UN terms "food insecure," or a total of one billion human beings, a new record.

That need never have occurred had it not been for the diabolical consequences of the US Government deregulating grain speculation, with support from the US Congress over the past decade or more. By early 2008, upwards of 35% of all US arable land was being planted with corn to be burned as biofuel under the new Bush Administration incentives. In 2011 the total is more than 40%. Thus, the stage was set for the slightest minor market shock to detonate a massive speculative bubble in grain markets, as was then being done by the use of the same GSCI index games as are played with oil.

Agribusiness As A Long-Term Strategy

The record rise in grain and food prices in recent years is not a mere Wall Street profit gimmick, although obscene profits are being made. Rather, it is apparently an integral part of a long-term strategy whose roots go back to the years just after World War Two when Nelson Rockefeller and his brothers tried to organize the global food chain along the same monopoly model they had used for world oil. Food would henceforth become just another commodity like oil or tin or silver whose scarcity and price could ultimately be controlled by a small group of powerful trading insiders.

At the same time the Rockefeller brothers were expanding their global business reach from oil to agriculture in the developing world through their technology-driven Green Revolution scheme after the war, they were also financing a little-noticed project at Harvard University. The project would form the infrastructure for their plan to globalize world food production under the central control of a handful of private corporations.

Its creators gave it the name ‘agribusiness,’ in order to differentiate it from traditional farmer-based agriculture - the cultivation of crops for human sustenance and nutrition. The push to place world national governments’ emergency grain reserves into private hands was merely a logical expansion of the original Rockefeller agribusiness strategy, as was their highly mis-represented “Green Revolution” which at day’s end merely promoted a huge sale of US agriculture products from John Deere tractors (using large volumes of Standard Oil Rockefeller products) to US chemical fertilizers made by other companies in the Rockefeller orbit—forcing a trend to large scale farming and forcing millions off the land into cities where they formed a cheap labor pool for large multinationals. The highly-touted harvest yields turned out to be actual losses after several harvests.

Agribusiness and the Green Revolution went hand-in-glove. They were part of a grandiose strategy which included Rockefeller Foundation financing of research for development of genetic alteration of plants a few years later.

John H. Davis had been Assistant Agriculture Secretary under President Dwight Eisenhower in the early 1950s. He left Washington in 1955 and went to the Harvard Graduate School of Business, an unusual place for an agriculture expert in those days. Davis had a clear strategy. In 1956 he wrote an article in the Harvard Business Review in which he declared, “the only way to solve the so-called farm problem once and for all, and avoid cumbersome government programs, is to progress from agriculture to agribusiness.” He knew precisely what he had in mind, though few observers had a clue back then.

Davis, together with another Harvard Business School professor, Ray Goldberg, formed a Harvard team with Russian-born economist Wassily Leontief, who was then mapping the entire US economy, in a project funded by the Rockefeller Foundation. During the war, the US Government had hired Leontief to develop a method of dynamic analysis of the total economy that he referred to as ‘input-output’ analysis. Leontief worked for the US Labor Department as well as for the Office of Strategic Services (OSS), the predecessor to the CIA.

In 1948 Leontief got a major four-year $100,000 grant from the Rockefeller Foundation to set up the Harvard ‘Economic Research Project on the Structure of the American Economy.’ A year later the US Air Force joined the Harvard project, a curious engagement for one of the prime US military branches. The transistor and electronic computers had just been developed along with methods of linear programming that would allow the processing of vast amounts of statistical data on the economy. Soon the Ford Foundation joined in to fund the Harvard project.

The Harvard project and its agribusiness component were part of a major attempt to revolutionize US and later, global food production. It was to take four decades before it dominated the food industry. Professor Goldberg later referred to the agribusiness revolution and the development of genetically-modified agribusiness as ‘changing our global economy and society more dramatically than any other single event in the history of mankind.’ He just might have been right as we are now likely about to witness over the coming decade.

As Ray Goldberg boasted years later, the core idea driving their agribusiness project was the re-introduction of ‘vertical integration’ into US food production. By the 1970s most Americans had forgotten that bitter battles had been fought before World War I and during the 1920's to pass laws in Congress to prohibit vertical integration by giant conglomerates, and to break up trusts such as Standard Oil, in order to prevent them from monopolizing whole sectors of vital industries.

It wasn’t until the David Rockefeller-backed Presidency of Jimmy Carter in the late 1970’s that US multinational business was able to begin the rollback of decades of carefully constructed US Government regulations of health, food safety and consumer protection laws, and open the doors to a new wave of vertical integration of agriculture. The vertical integration process was sold to unaware citizens under the banner of ‘economic efficiency’ and ‘economy of scale.’

A return to vertical integration and the accompanying agribusiness were introduced amid a publicity campaign in mainstream media and from industry claiming that government had encroached far too much into the daily lives of its citizens and had to be cut back to give ordinary Americans ‘freedom.’

The war cry of the campaigners was ‘deregulation.’ Of course, de-regulation by government merely opened the door to private controlanother form of regulation - by the largest and most powerful corporate groups in any given industry. That was certainly the case for agriculture - the big four grain cartel companies dominated world grain markets from the 1970s to today. They worked hand-in-glove with big Wall Street derivative players such as Goldman Sachs and JP Morgan Chase and Citigroup.

By the latter part of 2007, trading in food derivatives was fully deregulated by Washington, and US government grain reserves gone. The way was clear for dramatic food price rises.

The speculative machine that had been put into place by Wall Street and its banker friends was creating the potential for significant, long-term food inflation. But the inflation needed a major ‘venting’ to get the ball really rolling. That was to come from George W. Bush.

The Killer Punch — BP, Bioethanol and Genocide

In 2007, just as the US real estate crisis was causing the first tsunami shock waves through Wall Street, the Bush Administration made a major public relations push to convince the world that the US had turned into a "better steward of the environment." Too many fell for the hype.

The center of the Bush program, announced in his January 2007 State of the Union Address, was something called '20 in 10'—cutting US gasoline use 20% by 2010. The official reason given to the public was to "reduce dependency on imported oil," as well as cutting unwanted "greenhouse gas" emissions. That wasn't the case, of course, but it made good PR. Repeat it often enough and maybe most people will believe it. Maybe they won't realize that their taxpayer subsidies are being used to grow ethanol corn instead of feed corn and are also driving the price of their daily bread through the roof.

The heart of the Bush plan was a huge taxpayer-subsidized expansion of the use of bio-ethanol for transport fuel. President Bush's first plan required production of 35 billion gallons (about 133 billion liters) of ethanol a year by 2017. Congress had already mandated, via the Energy Policy Act of 2005, that corn ethanol for fuel must rise from 4 billion gallons in 2006 to 7.5 billion gallons in 2012.

To make certain it would happen, farmers and big agribusiness giants like ADM were given generous taxpayer subsidies to grow corn for fuel instead of for food. David Rockefeller’s corporate farms were one of the largest recipients of US Government agriculture subsidies. Currently ethanol producers in the US get a subsidy of 51 cents per gallon of ethanol. The subsidy is paid to the blender, usually an oil company, that blends it with gasoline for sale. In the 2011 harvest year, an estimated 40% of all corn acreage in the United States is expected to be grown for biofuel.

As a result of these generous US Government subsidies to produce bio-ethanol fuels, and the new legislative mandate, the US refinery industry has been investing big time in building special new ethanol distilleries, similar to oil refineries, except they produce ethanol fuel. The number currently under construction exceeds the total number of oil refineries built in the US over the past 25 years. When finished in the next 2-3 years, the demand for corn and other grain to make ethanol for car fuel will double from present levels.

Not wanting to be left behind, the EU bureaucrats in Brussels - no doubt generously encouraged by the likes of BP, Cargill, ADM and the major biofuel lobby - came up with its own scheme for "10 in 20" or a mandate that 10% of all road fuel in the EU by 2020 be from biofuel. Shockingly, they did so despite the existence of a report by the same EU Commission on the damaging impact of such a massive turn to subsidized biofuels. The London Times reported,

A study by the Commission on the land use implications of sourcing only 5.6 per cent of Europe’s transport fuel from biofuels concluded that any significant rise beyond 5.6 per cent would 'rapidly' increase carbon emissions and 'erode the environmental sustainability of biofuels'... Like most political diktats, the figure of 10 per cent was plucked out of the air and no one at the Commission had a clue, when the policy was adopted, how the fuel industry was to meet the one in ten mandate without a huge rise in biofuel planting in the tropics.

In short, the use of farmland worldwide for bio-ethanol and other biofuels—burning the food product rather than using it for human or animal feed—is being treated in Washington, the EU, Brazil and other major centers as a major new growth industry. The impact on human beings, however, is quite the opposite. It is rapidly becoming a death industry, death of millions of innocent human beings unable to afford adequate nourishment for themselves or their families.

The United States today is far and away the world's largest producer of ethanol biofuel for transportation fuel. In 2010 the US produced 13 billion gallons (US) or 50 billion liters of ethanol biofuel, amounting to near 60% of the world’s total. The EU added some 6% to the global total as number three behind Brazil in a macabre contest to see which country can destroy the most food by burning toxic biofuels.

The most alarming aspect of the entire biofuel scam is the fact that three full years after the grain price explosion of 2008 was demonstrated to be directly tied to the biofuels removal of millions of acres of US farmland - from corn for feed to corn for fuel - no action has been taken either in the US Congress or in the EU or anywhere else to reverse that insane policy.

The stunning inaction seems testimony to the political power of the biofuels lobby. Who are they? Not surprisingly, they are the same agri and oil giants behind US and EU food and energy policy. Major players include BP, Shell, ExxonMobil, Chevron, ADM, Cargill and the like. It is a powerful lobby and sees a goose that can literally lay multiple golden eggs in the form of mandated biofuels requirements of the EU and USA and elsewhere.

This January the Institute for European Environment Policy (IEEP), an independent body, issued a report on the role of bioenergy in EU governments' "renewable energy action plans." Recent proclamations by the German government that renewables will replace nuclear electric generation by 2020, and similar pledges by other EU governments, all rely on a fantastic delusion that the electriic power being generated by large nuclear plants can come from biodiesel. The January IEEP study notes that:

More than half of the renewable energy which EU Member States expect to consume annually by 2020 will consist of bioenergy, e.g. biomass, bioliquids and biofuels. This is revealed in a first evaluation of the proposed scale of deployment of bioenergy by the EU Member States in the period to 2020 as forecast in their National Renewable Energy Action Plans (NREAPs)...A significant increase in absolute consumption of bioenergy is anticipated. In the 23 plans examined, bioenergy will thus remain the main contributor to the renewable energy sector.

Overall, the bioenergy contribution to final energy consumption is expected to more than double, from 5.4% in 2005 to almost 12% (124Mtoe) in 2020. Bioenergy will have a quasi-dominant role in the renewable portion of the EU heating and cooling sector, and is foreseen to contribute more than 80% to the sectoral target. In the electricity sector the bioenergy share will be relatively low but in the transport sector it is expected to reach nearly 90% of total renewable energy by the year 2020.

The IEEP conducted an analysis of required land acreage needed for the cultivation of such a huge increase of biofuels by 2020. They estimated, after all factors are properly calculated, that an additional "4.1 to 6.9 million hectares" in the European Union will be needed for biofuel, acreage more than three times the entire state of Kansas.

Further, belying the EU myth that biofuels give a reduction of CO2 (even were CO2 a problem - which is highly contested among serious scientists), the IEEP calculates that the enormous rise in biofuel use will lead to more CO2 emissions from vehicles, equivalent to adding as many as 26 million additional vehicles on European roads.

Biofuels are highly undesirable for countless reasons, as many serious environmental organizations have begun to realize. The corn ethanol industry has grown, largely due to powerful corn and oil lobbies. High demand will likely increase corn ethanol and gas prices as corn ethanol is mixed with gasoline.

Ethanol energy gets poor fuel-economy with standard engines. And most importantly, it simply is not possible to produce the amount of corn required to make the fuel a viable alternative to oil or a serious supplier of energy.

New Global Dustbowls?

What biofuels and their pushers — from BP to agribusiness, combined with the mad decisions of governments from Washington to Berlin to Paris and beyond – have accomplished is the elimination of grain security reserves worldwide. This has been vigorously mixed with a cocktail of deregulated free commodity derivatives trading to create the ingredients for the worst potential food crisis in human history.

The testing of that hypothesis may unfortunately already be underway at the hands of forces far beyond the ability of man to control. At the recent annual meeting of the Solar Physics Division of the American Astronomical Society, scientists from the National Solar Observatory (NSO) and the Air Force Research Laboratory (AFRL) presented results of studies of recent solar flare activity, by far the greatest factor influencing climate change on Earth. Flares occur in periodic cycles such as 11-year, 22-year and longer ones. The solar studies indicate that the Earth is now at the beginning of what might be a decade or longer period of greatly reduced solar activity.

Reduced solar sunspot activity means a less active sun. As Dutch physicist Gijs B. Graafland puts it, “It will affect severely the evaporation of ocean water and by that the amount of rain. This results in lower water for agriculture and therefore in less growth and more severe blowing away of dry fertile top soil layers which gives a decade of high food prices.”

Translated to us, that could mean climate catastrophes, harvest failures, droughts and dust storms - such as those that swept the US Midwest during the Great Depression of the 1930s - in fertile regions across the planet, not just once but over a span of years. If the solar physicists as well as earlier Russian astrophysicist, Habibullo Abdussamatov, the head of space research at St. Petersburg's Pulkovo Astronomical Observatory in Russia who predicted similar onset of a new “Little Ice Age” beginning 2014, are right, we may soon face a food crisis on a scale our planet never in history has faced.

(F. William Engdahl, is the author of Seeds of Destruction: The Hidden Agenda of Genetic Manipulation, published by Global Research. He is also the author of Gods of Money: Wall Street and the Death of the American Century; A Century of War: Anglo-American Oil Politics and the New World Order and Full Spectrum Dominance: Totalitarian Democracy in the New World Order.)

So, hungry yet? Need some cheap biofuel, GMO food? Breathable air? Drinkable public water? Decent top soil? Dust bowls? Food stamps, anyone? USA! USA! USA! Makes you proud, doesn't it? Please read it all if you're back from the bathroom already after the initial throwing up subsided. _______________________________

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