Monday, February 25, 2013

Austerity ( the FauxConsensus?) Isn't Even Close To the Right Word (It's F A S C I S M!): Plan to Further Enrich the World's Wealthy, Privatize Medicaid in FL, and Take Over Once and For All

Well, it's certainly not Austerity for them (now is it?).

I like the way our American Everyman 'splains it.

And if you read to end of this essay you will understand how extreme wealth has deadened the "carriers."

The Opiate of the Disenfranchised

by willyloman

by Scott Creighton

First things first: let's stop calling this global neo-liberal class war "austerity". It's not austerity. When it was done to Chile in 1973 and Argentina and Poland and the Russia and all the others, it was naked class warfare... it's fascism. That's what it is.

And it's happening here as a direct result of what these financial oligarchs and their government stooges staged from 1998 (repeal Glass-Steagall and Commodities Modification Act) through 2008 (economic collapse of derivative bubble they created with sub-prime mortgages)

The Bush administration then implemented a nation-wide federal plan to "help" low-rated applicants with their down-payments on these sub-prime loans, effectively paying unqualified borrowers to become the fodder for their future demise.

They literally created "al Qaeda" in January of 2001 in a courtroom in New York based on the testimony of a known liar so they could stage a false flag event and use the "Global War on Terror" as the enforcement arm of their fascist agenda. 
This is economic warfare being waged after the implementation of economic terrorism. You talk about trade wars and currency wars being waged against other nations as warfare . . . this is the same thing but it's being waged against their own people.

In country after country we see the same thing: the fascist state rising from the ashes of social democracies here in the states, in Canada, Mexico, and all across Europe.
While they ran their "experiment" in Chile, they had designs on doing the same thing here and in Western Europe and so they did. 
It's time we understood that these monsters will do what is needed, whatever that is, to see their vision of the new world order take shape. It's time we stopped kidding ourselves about a victory based on a few half-measures and comfortable resistance.

It will not be comfortable in the world they are planning and they will not let us comfortably avoid it. This is a global life or death struggle with the highest stakes imaginable for them.

It's time we sobered up and quit with the opiate of the disenfranchised and took a long hard look at the struggle we are already engaged in.

A one-trick pony?

Anyone else notice what Florida's one-trick Governor just did to the "progressives."

Nothing like wearing those labels lightly, is it?

Black: 'It does not matter how many times Austerity makes the crisis worsen; the Austerians are a one-trick pony.' (photo: unknown)

Bill Black: 'It does not matter how many times austerity makes the crisis worsen; the austerians are a one-trick pony.'

The Plan to Enrich the World's Wealthy

By Bill Black, New Economic Perspectives
20 February 13

ohn Williamson, a Peterson Institute "senior fellow" coined the term "the Washington Consensus" at a conference in 1989.

Williamson joined the Institute in 1981 when it was founded by Pete Peterson, the Republican billionaire from Wall Street who has dedicated his life to proselytizing for lower taxes on the wealthy, stringent spending cuts in social programs, and privatizing Social Security – the unholy grail of Wall Street that would provide our largest banks with hundreds of billions of dollars in additional investment fees. Peterson has funded many groups to evangelize for these neo-liberal dogmas.

Williamson’s statement of the "ten" "principles" of what he chose to label "the Washington consensus" parallels Pete Peterson’s policies. Williamson, the Reagan administration and the IMF did not see these principles as being of equal importance. A paper by Williamson makes clear that the focus of the Washington Consensus was on Latin America.

Here is Williamson’s introductory paragraph, in full.

"No statement about how to deal with the debt crisis in Latin America would be complete without a
call for the debtors to fulfill their part of the proposed bargain by "setting their houses in order," "undertaking policy reforms," or "submitting to strong conditionality."
The question posed in this paper is what such phrases mean, and especially what they are generally interpreted as meaning in Washington. Thus the paper aims to set out what would be regarded in Washington as constituting a desirable set of economic policy reforms.

An important purpose in doing this is to establish a baseline against which to measure the extent to which various countries have implemented the reforms being urged on them.

The paragraph is critical to understanding the context of the creation of the Washington Consensus.

It was all about the Latin American "debt crisis." It was all about a quid pro quo.

The Washington Consensus was a consensus of creditors about how to deal with their debtors. Latin American debtor nations would be allowed to delay the repayment of their debts, but only if they "submit[ed]" to "strong conditionality" dictated by the Washington creditors. The creditors – the U.S. Treasury, the Federal Reserve, the IMF, and the largest U.S. banks – needed to develop a coordinated position on what to demand as their quid pro quofrom the Latin American debtors. The number one thing on their list from the beginning was austerity ("setting their houses in order").

The Washington Creditors were not willing to accept mere promises from the Latin America debtors. Williamson emphasized that a key purpose of creating an explicit Washington Consensus was to be able to use it as a scorecard to ensure that the Latin American debtor Nations were "submitting" fully to the Consensus’ requirements imposed by the Washington Creditors ("strong conditionality"). "An important purpose in doing this is to establish a baseline against which to measure the extent to which various countries have implemented the reforms being urged on them."
Williamson then (implicitly) acknowledged that the Washington Creditors’ ten principles bore three equivalents to an Achilles’ heel. First, he agreed that corruption could pervert the plan so that it would cause great harm. He admitted that the Washington Creditors had "at least some awareness" of this danger – a classic example of damning with faint praise. Williamson acknowledged that the Creditors who shared the Consensus believed that corruption in Latin America was "pervasive."

Williamson was implicitly admitting that the Creditors had committed the classic economics error (and the defining joke of the economics profession) by "assuming the can opener." The Creditors implicitly assumed that privatization, deregulation, and the protection of private property (Consensus principles 8-10) would not be perverted by "pervasive" corruption (and I would add, private "control fraud").

Second, Williamson acknowledged that there were many matters that Latin Americans considered to be vital to their well-being that the Washington Creditors deliberately ignored – even though Latin Americans correctly viewed them to be essential if the Patricians’ ten principles were not to cause harm.

"For better or worse, however, these broader objectives play little role in determining Washington’s attitude toward the economic policies it urges on Latin America. Limited sums of money may be offered to countries in return for specific acts to combat drugs, to save tropical forests, or (at least prior to the Reagan administration) to promote birth control, and sanctions may occasionally be imposed in support of democracy or human rights, but there is little perception that the policies discussed below have important implications for any of those objectives."
Third, Williamson grudgingly acknowledged that the Washington Creditors who created the fauxConsensus had disabling conflicts of interest because they were creditors of Latin American governments and were strongly motivated by their desire to impose policies that would maximize the repayment of their debts.

"Political Washington is also, of course, concerned about the strategic and commercial interests of the United States, but the general belief is that these are best furthered by prosperity in the Latin countries. The most obvious possible exception to this perceived harmony of interests concerns the US national interest in continued receipt of debt service from Latin America. Some (but not all) believe this consideration to have been important in motivating Washington’s support for policies of austerity in Latin America during the 1980s."
I want to know which Washington Creditors told Williamson that debtors and creditors have a "harmony of interests." They have a wonderfully droll sense of humor. The powerful love to take the position that "what’s good for GM is good for America, so it is no surprise that the Washington Creditors were sure that the positions they forcing Latin American Nations to "submit" to "best furthered … prosperity in the Latin countries." We have centuries of history proving that Washington Creditors are the people who know best the needs of Latin Americans and are passionately committed to serving the poor. Austerity is frequently the enemy of "prosperity."

Williamson then set out his ten principles. His first was austerity and he called it the "central" policy that the Washington Creditors had long insisted that Latin American Nations "submit" to through "high-conditionality programs." That phrase is code for harsh austerity likely to throw the Nation into receivership and emasculate the Nation’s sovereignty by agreeing to "submit" to its creditors’ demands.

Fiscal Deficits

"Washington believes in fiscal discipline. The International Monetary Fund (IMF) has long made the restoration of fiscal discipline a central element of the high-conditionality programs it negotiates with its members that wish to borrow. Left-wing believers in "Keynesian" stimulation via large budget deficits are almost an extinct species."
Williamson is an ultra-hawk on austerity. Even running a budget surplus may not suffice for Williamson:

"Unless the excess is being used to finance productive infrastructure investment, an operational budget deficit in excess of around 1 to 2 percent of GNP1 is prima facie evidence of policy failure. Moreover, a smaller deficit, or even a surplus, is not necessarily evidence of fiscal discipline: its adequacy needs to be examined in the light of the strength of demand and the availability of private savings."
Williamson did not distinguish between Nations with sovereign currencies that they allow to freely float and who borrow in their own currency and Nations without fully sovereign currencies. He and the Washington Creditors shared this lack of understanding of sovereign currencies, which led them to demand that Latin American Nations "submit" to austerity when that policy would be economics malpractice analogous to the medical malpractice of bleeding patients.

The Washington Creditors’ succeeded in getting most of Latin America to "submit" to austerity, deregulation, and privatization. The resultant scandals enraged tens of millions of Latin Americans and led to the election of many national leaders running on the promise to refuse to "submit" to the Washington Consensus. 
Neo-liberal economists and politicians, however, are prisoners of their pro-austerity dogmas. They repeatedly force nations back into recession or even depression. It does not matter how many times austerity makes the crisis worsen; the austerians are a one-trick pony. 

I believe that within five years we will see a series of political leaders elected in Europe on anti-austerity planks. The Washington Creditors’ Consensus is a leading cause of financial crises and human misery because of it self-destructive austerity and anti-regulatory principles. Austerity is the leading cause of the election of national leaders who promise that if elected they will stop "submitting" to creditors’ demands that they inflict austerity on their people.

Gov. Rick Scott’s Medicaid Flip: “Progressive” Victory in Privatizing Medicaid

February 21, 2013

by Scott Creighton

It's not about seeing the "progressive" light folks. It's about privatizing the entire Medicaid program here in Florida and giving more and more money to managed healthcare companies who will undercut the healthcare poor people receive. It's big money for the managed care companies and less healthcare for the poor of Florida. A "progressive" victory to be sure.

"Progressives" like Maddow and the Huffington Post are all a dither about Gov. Rick Scott's recent flip-flop on the Medicaid expansion part of the Obamacare project. Gov. Scott ran for office opposing that measure of the plan, not the unconstitutional mandate portion of it by the way. He said that it would increase the deficit monster needlessly so he opposed the plan to have the federal government pay for the increased Medicaid rolls in our little neo-liberal state.
But last night the now billionaire governor and former health company CEO/owner claims he has had a change of heart because "it's the law"
In reality, "the law" states that the states themselves have a choice as too whether or not they implement the plan. That's "the law"
While fake "progressives" like Maddow and the Huffington Post cronies are busy patting themselves on the back for the rightness of their cause being admitted by republican holdouts like Gov. Scott, they are missing the point... probably by design.
"Apparently, Republicans implicitly realize that the way to become more popular in 2013 is to move away from the right and closer to the mainstream -- which necessarily means embracing more progressive views." Maddow Blog
Fact is, the ONLY reason Gov. Scott changed his mind is because hours before his announcement, the federal government agreed to Florida's plan to completely privatize their federally funded Medicaid program.
The New York Times was a little more honest in their explanation as too why Gov. Scott changed his mind:
"Shortly before his announcement, the governor received word from the federal government that it planned to grant Florida the final waiver needed to privatize Medicaid, a process the state initially undertook as a pilot project. Mr. Scott, who is running for re-election next year, has heavily lobbied for the waiver, arguing that Florida could not expand Medicaid without it." New York Times
That's right. Gov. Scott agreed to the plan to expand the Medicaid rolls in Florida just after getting permission from the feds to privatize it.
"At least Rick Scott got his “1115 waiver” – which will let the state shuffle more of its Medicaid recipients into managed care plans. That’s not a highly original vision of reform. The waiver makes it the burden of the health plans to sand down the benefits that these patients receive to match the Medicaid program’s declining fortunes." Forbes
What this does effectively is give the managed healthcare organizations a free hand in denying services to the poor while cashing in on the "big guberment "dollars. How could some like the billionaire governor refuse that sweet a deal.
How sweet is it for the companies? JP Morgan has a note out this morning already estimating big bucks for shareholders of those companies.
JP Morgan is out with a research note this morning that estimates the largesse paid to the legitimate side of the state’s healthcare market.
On the plan side, assuming $500 in incremental revenue at a 2% margin, JP Morgan calculated that earnings per share would grow by $0.12 for Molina Health (NYSE:MOH); $0.11 for Centene Corp (NYSE:CNC); and $0.02 for Aetna (NYSE:AET). Forbes
Neo-liberal Tea Partier Gov. Scott thinks it's "A-OK" to add tons of new debt to the deficit monster, just so long as that cash goes to BIG BUSINESS.
This is the headline, this is the story. But NOTHING from the fake "progressive' left who are so busy patting themselves on the back they are likely to break their own arms in the process. Good thing they're the petty bourgeoisie and have decent insurance coverage . . . for now.

By Paul Buchheit

"The wealthy give plenty of excuses for our outrageously unjust society. They just go to show that extreme wealth can destroy your brain. As we try to grasp the reasoning behind cuts to life-saving programs while billion-dollar incomes and trillion-dollar profits are being made, we must understand that extreme wealth deadens parts of the brain. Empathy and honesty go first. Then rationality, as evidenced by some of the outlandish excuses given by the very rich for their abuses.

1. Excuses for Inequality: Here's what Goldman Sachs adviser Brian Griffiths said about it: "We have to tolerate the inequality as a way to achieve greater prosperity and opportunity for all." U.S. wealth distribution has become so extreme that nearly half of America has, on the average, ZERO WEALTH (debt exceeds assets). As for income, the richest 1% seemed to perform the impossible from 2009 to 2011, capturing MORE THAN 100% of the new income gains (income decreased for the other 99%). As irrational as it might seem to find an excuse for all this, the Heritage Foundation is up to the task, claiming that poor Americans are actually doing quite well with their TVs and air conditioners. Never mind that debt for the poorest quintile of Americans averages $27,000 more than their possessions.

2. Excuses for Bank Fraud: It seems unlikely that anyone would try to justify the lack of punishment for manipulating global interest rates and consorting with drug cartels. But excuses were readily available. Hyperbole made up for incomprehensibility. Treasury Secretary Hank Paulson warned us that without a bailout the world economy would collapse "within 24 hours." Assistant attorney general Lanny Breuer added that with criminal charges "the entire banking system would have been destabilized." Others questioned whether crimes had really been committed, or whether the people in charge even knew what was happening. In any event, bank backers noted, the financial institutions were fined. Four weeks of profits. And a bank CEO said he was "profoundly sorry."

3. Excuses for a Dormant Minimum Wage: Despite the logic and fairness of sharing record profits with low-wage workers who helped to make it all possible, a minimum wage increase has long been rejected because of the claim that it will increase unemployment. This has been refuted again and again and again. Yet well-positioned people persevere, armed with the same excuse. Says Paul Ryan: "I think it's inflationary. I think it actually is counterproductive in many ways. You end up costing jobs from people who are the bottom rung of the economic ladder." The Economic Policy Institute calculated that a minimum wage increase would actually CREATE up to 100,000 jobs by the middle of 2014.

4. Excuses for Not Paying Taxes: Rather than excuses, corporate heads often take the more aggressive denial route with their comments:

- A GE spokesperson: "We are committed to acting with integrity in relation to our tax obligations." GE paid 0% from 2008 to 2010.
- An Exxon spokesperson: "..any claim we don't pay taxes is absurd...ExxonMobil is a leading U.S. taxpayer." Exxon paid 2% from 2008 to 2010.

But CEOs still manage to come up with creative excuses. Caterpillar's Doug Oberhelman blamed Illinois. He said the state has "created an environment that is unfriendly to business and investment." Caterpillar paid less than 1% in state income taxes from 2008 to 2010.

As for individual taxes, the wealthy hang onto the foggy (and discredited) notion that a higher tax rate on the rich somehow "hurts the economy." Numerous inventive excuses come with the estate tax, most of them recycled from other tax arguments. The estate tax is accused of slowing economic growth, destroying jobs, suppressing wages, discouraging saving, and promoting wasteful spending. Actual facts, meanwhile, come from the Center on Budget and Policy Priorities, which notes that only the richest 2 in 1,000 estates pay any estate tax, at levels generally less than one-sixth of their values.

Excuses were even available for the special case of Facebook's part-owner Eduardo Saverin, who serendipitously landed Mark Zuckerberg as a roommate at Harvard, used American resources to make billions, and then revoked his citizenship to avoid paying any tax at all. A Forbes writer called Saverin an "American hero" for quitting on America. The American Thinker said "The U.S. tax code is so oppressive that smart and successful people like Saverin are compelled to renounce citizenship.." Saverin's defenders might not be aware of an OECD report that ranked U.S. taxes among the lowest in the world.

5. Excuses for No Taxes At All: One might feel ashamed paying no sales tax on credit default swaps when low-income mothers pay 10% on winter clothes for the kids. But not the guys on Wall Street. At any mention of a financial transaction tax (FTT) they get testy: It will ruin our liquidity! It will hurt the economy! It's a sin tax! But an FTT is inexpensive to administer, proven successful in other countries, and capable of generating hundreds of billions of dollars per year.

Perhaps it's only fair, in conclusion, to excuse the super-rich for their lack of empathy and honesty and rationality. They believe that their upward redistribution of wealth is showing everyone else the value of a little initiative and hard work. With such a spirit of free enterprise we can all aspire to the lofty goals of Charles Koch: "I want my fair share - and that's ALL of it."

Paul Buchheit is the founder and developer of social justice and educational websites (,,, and the editor and main author of "American Wars: Illusions and Realities" (Clarity Press). He can be reached at

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