Tuesday, April 30, 2013

Is It Wrong To Tax the Old Today To Enrich the Old of the Future? (Is It Only the Media, Stupid?)



Bill Greider has always been a voice of reason who provides excellent historical context for the smoke and mirrors journalism deluging us today.

April 26, 2013 by The Nation
 

President Obama discusses the federal budget at the White House. (AP Photo/Manuel Balce Ceneta) 

At the start of his second term, events pushed President Obama to choose between the living and the dead. He chose dead millionaires over elderly people living on Social Security. The wealthy were given a most generous reduction in the estate taxes to be collected when they die. Social Security beneficiaries were told to live with smaller benefit checks. Instead of comforting the afflicted and afflicting the comfortable, Obama went the other way.

A more ambitious political leader would articulate and demand what he wants and what his party will insist on, regardless of whether it seems immediately achievable. Democrats are instead undercut by Obama’s sense of caution.

I asked Robert McIntyre, the celebrated reformer at Citizens for Tax Justice, what he makes of this odd presidential twist. “The Obama administration has mixed feelings about old people,” McIntyre dryly observed. “Old people on Social Security deserve smaller benefits. Old people who own estates worth tens of millions deserve smaller tax bills for their children.”

How could this have happened with a Democratic president in the White House? In early January, under pressure to make a “fiscal cliff” deal with Republicans, the president signed a new estate tax law that delivered a gorgeous windfall for those with accumulated wealth—or, rather, for their children or others who inherit the family fortunes. All rich people are now entitled to an estate-tax exemption of $5 million. That is seven times larger than the exemption that existed in the last years of the Clinton administration ($670,000) and more than double George W. Bush’s ($2 million).

Furthermore, because this new estate-tax exemption is indexed to protect against inflation, the exemption will keep growing bigger year after year. For 2012, the exemption rose by $120,000 and another $130,000 for 2013. That’s an annual inflation-driven increase of about 2.5 percent, though Social Security recipients received an increase of only 1.7 percent at the same time.

The new cost-of-living index Obama has proposed for Social Security would work in the opposite direction. It is designed to reduce Social Security benefits in future years, less than what people would get from the present calculation. The White House describes its so-called “chained CPI” as a technical fix that is good government policy.

Yet, taken together, these changes are a revenue loser for the government. The generous reductions in the estate tax will cost around $400 billion in lost revenue by not reverting to terms before the Bush II presidency worked to undermine it. The “chained CPI” fix for Social Security and other programs, including the estate tax exemption, is expected to save only about half as much as the estate tax loses—and those savings come not from the rich, but the broad ranks of working people.

Meanwhile, fewer than 4,000 very rich people will be left to pay the estate tax. This is not total victory for Republicans—they wanted to abolish the estate tax altogether—but it seems close enough. If you want to understand how the federal government drives the nation’s increasing inequality, look no further than the federal tax code.

The president is evidently having second thoughts of his own, at least about the rotten estate-tax deal he accepted. His new budget message promises to reopen that bad bargain and reinstate the estate tax exemption of $3.5 million that existed during his first year in office. Good luck with that one, Mr. President. It is hard to take his gesture seriously since the president proposes to restore the estate tax in 2018—two years after he has left office.

A more ambitious political leader would articulate and demand what he wants and what his party will insist on, regardless of whether it seems immediately achievable. Democrats are instead undercut by Obama’s sense of caution.
Robert Greenstein of the Center on Budget and Policy Priorities, though supportive of Obama on the “chained CPI” issue, has wistfully cited an alternative remedy proposed by the late Robert Ball in his last years. Ball was a wise and trusted Social Security commissioner whom liberals relied on. He wrote that government could insure the permanent solvency of Social Security by raising the cap on the payroll tax deductions and by dedicating the revenue from the estate tax to keeping the Social Security trust fund in good health.

That connection between dead millionaires and retired working people could solve a lot of problems. It probably sounds too radical for Obama Democrats.

The president’s recurring problem is his softball style of governing. He begins negotiations by giving up his leverage—offering to retreat from the party’s crown jewels like Social Security or the strong estate tax Democrats traditionally defended. Then he asks Republicans to be reasonable and reciprocate. They respond by kicking him in the shins. Republicans play hardball, and with considerable success. Obama Democrats are playing badminton.
William Greider
William Greider is national affairs correspondent for The Nation. He is author of "Secrets of the Temple: How the Federal Reserve Runs the Country" and, most recently, "Come Home, America: The Rise and Fall (and Redeeming Promise) of Our Country."

Robert Parry is an excellent source of information for understanding the issues that most occupy the country's owners, er, I mean renters.

Exclusive: Rich right-wingers, including the Koch Brothers and Rupert Murdoch, are eying the purchase of the Los Angeles Times and other major regional newspapers to create an even bigger platform for their propaganda, a media strategy that dates back several decades, as Robert Parry explains.

The U.S. news media was never “liberal.” At most, you could say there were periods in the not-too-distant past when the major newspapers did a better job of getting the facts straight. There also was an “underground” press which published some scoops that the mainstream media avoided.

 

(Image: Still from the film, "Citizen Kane")

So, reporters revealed the evils of racial segregation in the 1950s and 1960s; war correspondents exposed some of the cruel violence of the Vietnam War in the late 1960s; major newspapers defied the U.S. government in printing the leaked history of that war in 1971; the Washington Post uncovered some (though clearly not all) of Richard Nixon’s political crimes in 1972-74; and the New York Times led the way in publicizing some of the CIA’s dirty history in the mid-1970s.

While such work surely offended the Right and many parts of the Establishment, the stories had a common element: they were true. They were not, in that sense, “liberal” or “conservative” or “centrist.” They were simply accurate – and they helped spur America’s other democratic institutions to life, from protests in the streets to pressures on the courts to citizens lobbying government officials.
It was that resurgence of participatory democracy that was the real fear for those who held entrenched power, whether in the segregationist South or inside the wood-paneled rooms of Wall Street banks and big corporations. Thus, there developed a powerful pushback that sought to both hold the line on additional (and possibly even more damaging) disclosures of wrongdoing and to reassert control of the channels of information that influenced how the American people saw the world.
In that context, one of the most effective propaganda strategies was to brand honest journalism as “liberal” and to smear honest journalists as “anti-American.” That way many Americans would doubt the accurate information that they were hearing and discard many real facts as bias.
As a journalist for the Associated Press and Newsweek in the 1980s, I encountered these hardball tactics while covering the Reagan administration as it sought to manage the perceptions of the American people mostly by hyping external threats (from Managua to Moscow) and demonizing some internal groups (from “welfare queens” to labor unions).
Reagan’s men described one of their central goals as “kicking the Vietnam Syndrome,” that is, the resistance among the American people to be drawn into another overseas conflict based on deceptions.
The Air Waves War
But the key to their success was to gain control of as much of the U.S. news media as possible – through direct ownership by like-minded right-wingers or by appeals to senior news executives to adopt a more “patriotic” posture or by intimidation of those who wouldn’t toe the line.
The tactics worked like a charm – and were aided by a simultaneously shift on the Left toward selling off or shutting down much of the Vietnam-era “underground” press and instead concentrating on local organizing around local issues, “think globally, act locally,” as the slogan went.
This combination of factors essentially gave the Right and conservative elements of the Establishment dominance of the news. Like an army that controlled the skies, it could fly out and carpet-bomb pretty much anyone who got in the way, whether a politician, a journalist or a citizen. No truth-teller was safe from sudden obliteration.
The Right’s success could be measured at different mileposts in the process, such as the Republican containment of the Iran-Contra scandal in 1987 and President George H.W. Bush’s pronouncement after crushing the out-matched Iraqi army in 1991 that “we’ve kicked the Vietnam Syndrome once and for all.”
This new media reality – as it expanded through the 1990s and into the new century – meant that the Right could put nearly any propaganda theme into play and count on millions of Americans buying it. Thus, President George W. Bush could make up excuses to invade Iraq in 2003 and face shockingly little media resistance.
Eventually a few voices emerged on the Internet and at some lower-rung news outlets to challenge Bush’s case for war but they could be easily discredited or ignored. It took Bush’s disastrous handling of the Iraq War and other domestic and foreign crises to finally put a wrench in this right-wing propaganda machine.
However, the overall dynamic hasn’t changed. Yes, MSNBC – after failing in its attempt to be as right-wing as Fox News – veered leftward and found some ratings success in offering “liberal” assessments on domestic politics (though still avoiding any serious challenge to the Establishment’s views on foreign policy).
There also are some feisty Internet sites that do challenge the conventional wisdom in support of U.S. interventionism abroad, but nearly all are severely underfunded and have limited reach into the broad American population.
Buying Up Newspapers
And, the likelihood now is that the Right will consolidate its dominance of the U.S. news media in the years ahead. In the very near future, some of the country’s most prominent regional newspapers may fall under the control of right-wing ideologues like Rupert Murdoch or the Koch Brothers.
Koch Industries, a privately owned oil and gas giant which has provided the means for Charles and David Koch to lavishly fund libertarian think tanks and Tea Party organizations, is now exploring a bid to buy the Tribune Company’s eight regional newspapers, including the Los Angeles Times, the Baltimore Sun, the Orlando Sentinel, the Hartford Courant and the Chicago Tribune, according to a report in the New York Times last Sunday.
By buying the Tribune newspapers, the Koch Brothers would give themselves another strong platform for delivering volleys of right-wing propaganda and wreaking havoc on political adversaries. I remember in my days covering Capitol Hill being told that what a congressman fears most is the determined opposition of the hometown newspaper.
Another expected bidder, at least for the Los Angeles Times, is media mogul Rupert Murdoch, who already owns Fox News and powerful newspapers in the United Kingdom and the United States, including the Wall Street Journal.
On the other side of the bidding are some liberal-oriented businessmen eying the Los Angeles Times, but it is not clear if they can compete with the fat wallets of the Koch Brothers and Murdoch. The New York Times reported that Koch Industries might have an edge in the competition because it would take over all eight newspapers at once.
Some on the Left mock the idea of investing in the “dinosaur” industry of newspaper publishing and question the value of owning even some of these prestigious names in American journalism. It is certainly true that those newspapers have declined in recent years due to poor management and shifts in advertising dollars.
But they still influence how people in those metropolitan areas learn about the world. The newspapers also help set the news agenda for local TV stations and bloggers. The Baltimore Sun, for instance, produced some of the most important reporting on the Reagan administration’s human rights crimes in Central America, as well as publishing groundbreaking stories about domestic spying under George W. Bush.
Yes, some of these newspapers have disgraced themselves in recent decades, such as the Los Angeles Times’ shameful attacks on journalist Gary Webb after he revived the Reagan administration’s Contra-cocaine scandal in the late 1990s. [See Robert Parry’s Lost History.]
But Internet sites – even ones like Consortiumnews.com with a strong interest in doing investigative journalism – lack the financial resources and the editorial support to carry out those kinds of costly investigative projects, at least with any regularity.
Without major investments by honest Americans in honest journalism – whether the Old Media of print or the New Media of electronics – the United States will continue to drift into a made-up world of right-wing paranoia and pretend facts. And that is a danger for the entire planet.
Robert Parry
Robert Parry broke many of the Iran-Contra stories in the 1980s for the Associated Press and Newsweek. His latest book, Neck Deep: The Disastrous Presidency of George W. Bush, was written with two of his sons, Sam and Nat. His two previous books are Secrecy & Privilege: The Rise of the Bush Dynasty from Watergate to Iraq and Lost History: Contras, Cocaine, the Press & 'Project Truth'.

Monday, April 29, 2013

The Big Difference: When You Do It, It's Conspiracy Theory. When We Do It, It's Informed Speculation (Success Through Indirection, Mis-direction, Redirection, and Protection) I Am Not A Pleasure Unit Anymore!



(If throwing a contribution Pottersville2's way won't break your budget in these difficult financial times, I really need it, and would wholeheartedly appreciate it. Anything you can afford will make a huge difference in this blog's lifetime.)


Now you know I'm not a conspiracist, but I have to admit that I haven't had so much fun wending my way through conspiracy theories since the 1974 Church Committee's JFK Assassination hearings, which were only allowed to happen due to the double shocks to the establishment owners' hold on the media, resulting from the unexpected outing of the Watergate CIA-funded-and-Howard-Hunt-directed Republican Party break-ins and Nixon's resignation.

Until now.

Seems that there's another pretty big one being promulgated by mainstream media (MSM) TV stations and newspapers, the oh-so-trustworthy Associated Press, and all of the fear-inspiring cable stations that have been summoned from the depths of hell, but being exposed little by little by bloggers and those with their own sites on the internet as we, the faithful believing-in-spirits taxpaying little people, try to make sense of each latest iteration of what will eventually come to be known as the Boston backpack bombera.

And this is definitely one zinger of a conspiracy theory as the main mouthpiece (at this time) is related to the supposed-bombers and went to school at Duke (before being recruited by the CIA) and met his future wife at UNC (before they both returned to, oh, Chechnya, for one place they camped out in for a while). So, it's a local story for North Carolina (as well as Massachusetts)! And you know how we all love a local story. Or a ghost story!

I can feel the Truth Troops gathering.

Boston Bombers’ Uncle Married Daughter of Top CIA Official


Posted on April 26, 2013 by Daniel Hopsicker

The uncle of the two suspected Boston bombers in last week’s attack, Ruslan Tsarni, was married to the daughter of former top CIA official Graham Fuller.

The discovery that Uncle Ruslan Tsarni had spy connections that go far deeper than had been previously known is ironic, especially since the mainstrean media's focus yesterday was on a feverish search to find who might have recruited the Tsarnaev brothers.

The chief suspect was a red-haired Armenian exorcist.  They were fingering a suspect who may not, in fact, even exist.


It was like blaming one-armed hippies on acid for killing your wife.



Ruslan Tsarni married the daughter of former top CIA official Graham Fuller, who spent 20 years as operations officer in Turkey, Lebanon, Saudi Arabia, Yemen, Afghanistan, and Hong Kong. In 1982 Fuller was appointed the National Intelligence Officer for Near East and South Asia at the CIA, and in 1986, under Ronald Reagan, he became the Vice-Chairman of the National Intelligence Council, with overall responsibility for national level strategic forecasting.



At the time of their marriage, Ruslan Tsarni was known as Ruslan Tsarnaev, the same last name as his nephews Tamerlan and Dzhokhar Tsarnaev, the alleged bombers.

It is unknown when he changed his last name to Tsarni.

What is known is that sometime in the early 1990’s, while she was a graduate student in North Carolina, and he was in law school at Duke, Ruslan Tsarnaev met and married Samantha Ankara Fuller, the daughter of Graham and Prudence Fuller of Rockville Maryland. Her middle name suggests a reference to one of her father’s CIA postings.

The couple divorced sometime before 2004.

Today Ms. Fuller lives abroad, and is a director of several companies pursuing strategies to increase energy production from clean-burning and renewable resources.




On a more ominous note, Graham Fuller was listed as one of the American Deep State rogues on Sibel Edmonds' State Secrets Privilege Gallery. Edmonds explained it featured subjects of FBI investigations she became aware of during her time as an FBI translator.

Criminal activities were being protected by claims of State Secrets, she asserted. After Attorney General John Ashcroft went all the way to the Supreme Court to muzzle her under a little-used doctrine of State Secrets, she put up twenty-one photos, with no names.


One of them was Graham Fuller.

"Congress of Chechen International Organizations" c/o Graham Fuller



A story about a Chechen oil exec/uncle pairing up with a top CIA official who once served as CIA Station Chief in Kabul sounds like a pitch for a bad movie.

But the two men may have been in business together.

In 1995, Tsarnaev incorporated the Congress of Chechen International Organizations in Maryland, using as the address listed on incorporation documents 11114 Whisperwood Ln, in Rockville Maryland, the home address of his then-father-in-law. 

It is just eight miles up the Washington National Pike from the Montgomery Village home where “Uncle Ruslan” met — and apparently wowed, the Press after the attack in Boston.

The Washington Post yesterday called him a "media maven," while nationally syndicated Washington Post columnist Ester Cepeda , in a piece with the headline “The Wise Words of Uncle Ruslan” opined that he was her choice for "an award for bravery in the face of adversity.”

Success Through Indirection, Mis-direction, Redirection, and Protection



Uncle Ruslan’s spy connections go far deeper than was already known, which was that he spent two years working in Kazakhstan for USAID.

But the mainstream media was looking the other way.

Under the headline Did 'Misha' influence Tsarnaevs? In Watertown, doubts,” USA Today reported: “Misha. A new name has emerged in the Boston Marathon bombing case — one familiar to the family of the two young men accused of the atrocity and apparently of interest to the Russian and American security services as well.”

Ruslan Tsarni was the first to bring up the supposed man's supposed name. Or rather, he brought up a first name:  Misha. But it was enough. We were off to the races . . .

Attention All Cars: Be On Lookout for Chubby Armenian Exorcist

Tsarni described Misha to CNN as being "chubby, a big guy, big mouth presenting himself with some kind of abilities as exorcist . . . having some part-time job in one of the stores, not married. All of the qualifications of a loser, just another big mouth.”



According to Uncle Ruslan, Misha was the man who over a considerable period of time had radicalized Tamerlan.

It seemed strange, then, that in contrast to his “you are there” verbal picture of the man, even with all his supposed concerns, and given his high level of education and abundant resources (Big Sky Energy was paying him in excess of $200,00 a year, according to documents filed with the SEC) Ruslan had somehow never found out just who the bad guy was.

He never got a name, something that in spook-dom is considered
something of a faux pas. Then again, no one else had either.

Worse, Tsarni's vivid description seemed to be taken from personal observation, from, in other words . . . real life. But that isn’t possible. Tsarni had stated he hadn’t been physically in the presence of his Boston relatives since December 2005. And Misha, if he existed, didn’t show up on the scene until 2008 at the earliest.


Still, just a few days later, the entire family began chiming in. Misha anecdotes were flying fast furious, and the nation’s scribblers were busy uncritically scribbling down their every word.

Maybe their Twitter account got hacked again?

No performance was nearly as masterful, however, as that of the Associated Press.

“Bomb suspect influenced by mysterious radical,” reported the Associated Press.

"Tamerlan's relationship with Misha could be a clue in understanding the motives behind his religious transformation and, ultimately, the attack itself," reported the Associate Press.

Only to take it all back in the very next line.


"Two U.S. officials say he had no tie to terrorist groups."

The AP’s “story” about the mysterious “Misha” was 1145 words, long enough for an editor to squeeze in a caveat.

“It was not immediately clear whether the FBI has spoken to Misha or was attempting to,” the national wire service reported. “Efforts over several days by The Associated Press to identify and interview Misha have been unsuccessful.”

The big difference: when you do it, it's conspiracy theory. When we do it, it's informed speculation.


In any other context, this might be seen as the rankest kind of “conspiracy theory.” But, apparently, when the Associated Press does it, it's news.

Then Uncle Ruslan made a clear mis-step.


“An uncle of the alleged bombers claims that Misha, an Armenian convert to Islam, had a huge influence on the elder brother, Tamerlan Tsarnaev.
Describing him as an "Armenian exorcist," Tsarni said, “Somehow he just took his brain.”

Armenians are a deeply-rooted Christian community, which is proud of the fact that their country was the first in the world to adopt Christianity as state religion in 301 AD.
Moreover this is the week every year when they remember the Armenian Holocaust, when as many as 1,000,000 Armenians were slaughtered by Turkish Muslims.

In the large and close-knit Boston Armenian community, a red-bearded Armenian named Misha becoming a radicalized Muslim would stand out.

"I've never heard of him, nor has anyone that I know," Hilda Avedissian, executive director at the Armenian Cultural & Educational Centre.

So what if the guy was involved with the biggest bank fraud in history?

"For an Armenian to convert to Islam is like finding a unicorn in a field," Nerses Zurabyan, 32, an information technology director who lives in nearby Cambridge told USA Today.

The report reveals that the bomber’s Uncle, made famous for his outspoken condemnation of his nephews, which aired repeatedly on international news networks, is a well-connected oil executive who at one point worked for a Halliburton shell company used as a front to obtain oil contracts from the Kazakh State.

Ruslon Tsarni was implicated in an investigation involving the laundering and theft of $6 billion.

But everybody loves Uncle Ruslon. At least most of America’s mainstream media does.

There has, to date, been no speculation at all about whether an uncle of the men suspected of the bombing who had been involved in international intrigue at the hightest levels, and who married the daughter of a top CIA official, might warrant a closer look.

It’s enough, isn’t it, to turn even reasonably rational adults into — gasp! — conspiracy theorists.

“News,” someone once wrote, “is selection. And selection is always based on an ideology and agenda, which is something to remember next time you watch, listen, or read the ‘news.’”

Too true.

Comments:

  1. I have always believed the corporate right realized the power of controlling the message and have been building a powerful vertical infrastructure for the last 3 decades starting with the repeal of the Fairness Doctrine in '86 . . . No coincidence that RUSH came on the scene in '87.

    Joseph Goebbels recipe (paraphrased) You can control a people any where at any time by doing 3 things:

    1. Always have an enemy (GOVT, Obama, illegals, gays etc)
    2. Always be the UBER Patriot (see Tea Party group names or listen to Fox and AM RADIO)
    3. Always have the means to saturate and repeat and repeat and repeat your message until it becomes the “truth” (see talk radio) It may be old technology but over 20 million listen DAILY.

    • Your observations are astute, Lynne: The only hope lies in the verticality. All Empires crash – this one will be no exception. The problem is, we’re underneath them.
  2. It may be difficult to swallow, but Americans may have to face the reality that mediocrity and willful ignorance have become the norm in our society. If the Kochs can buy these papers and keep them in circulation, it just proves they have a better handle on America’s sentiments than those of us who find the idea repulsive. The great conceptual fallacy of the “Occupy” movement was the idea that it represented 99% of anything, let alone the political mood of the country. Of course, the delusional notion that anything could succeed without stating goals, aims or a strategy didn’t help. Nobody bothered to look into the bankrupt ideology of its feckless progenitor, David Graeber. No social movement succeeds without disrupting something. Just ‘being there” was Occupy’s apparent strategy. Thousands of people volunteered to get bludgeoned, brutalized, pepper sprayed and arrested for no specific goal. Those memories, in conjunction with the visual impact accomplished by the lockdown of Boston by martial law, have solidified in the public psyche the futility of the “right to assembly” and the “redress of grievances”. Unions once wielded power because they could exact a financial toll by stopping production. The Kochs have thus taken great pains to subvert unions, and the electorate, mind you, voted for the politicians that helped them do it. America, my friends, appears to despise even what little is left of its own freedom. If it didn’t, it wouldn’t keep voting against its own interests. If “Occupy” actually represented even 50% of anything, it could have bankrupted McDonalds, or CitiBank, or WalMart, or Kentucky Fried Chicken. It could have picked a minimum wage sweatshop and boycotted it nation-wide. With the political clout that would have inspired, it would have gotten immediate media attention. Jackass politicians fighting over gay marriage and gun laws instead of unemployed, sick, and poverty stricken Americans would have been trembling in their collective alligator shoes. Instead, Americans will likely be reading about the shortage of beds in “for profit” prisons and the need for more assault weapons, helicopters and armored military vehicles to maintain law and order in our crumbling cities. They’ll be reading about that in the Koch Brothers’ newspapers, because what Americans REALLY love is not their freedom. What they REALLY love is seeing somebody punished for being less fortunate than they are. If I’m wrong, they’ll simply boycott those newspapers…but don’t count on it.

    • The Kochs don’t buy these to run them profitably. They run them as a propaganda tool to prop up their other interests that give them much more money and power than they would ever get from the newspaper business. They already own the state government of Kansas.

      Also, media is not there to inform or entertain. It is there to sell advertising, mostly to big right wing corporations. Who better to sell advertising to the right wing than another of their fellow propagandists (see Fox News & Fox Street Journal).

      It’s difficult to boycott monopolies and oligopolies when they are the only game in town. In almost all cases there’s no difference between any of them when it comes to product or treatment of suppliers, customers and employees.
  3. Great comment Lynn, perfect and to the point.

    I always felt the media was in the back pocket of Washington. AM radio became their launching pad for the right when it began to change in the mid 80′s. How many times can you call the media liberal. Look who owns the media today, that should say it all.
  4. Koch and Murdoch want to make sure that there is no independent news media to challenge the Jewish lobby’s grip over westerners’ minds.

    Two years ago, the disgraced Israel-Firster media tycoon, Rupert Murdoch, was honored by one of America’s top Israel lobby groups, ADL, for his “stalwart support of Israel and his commitment to promoting respect and speaking out against anti-Semitism”.

    Christopher Bollyn claimed in 2003 that Murdoch has Zionist Jewish family roots and he had prior knowledge of 9/11.

    In June 2012, former British prime minister Tony Blair’s ex-communications director, Alastair Campbell claimed in his diaries published by British daily The Guardian – that Murdoch called Blair on March 11, 2003 – eight days before US invasion of Iraq – urging him not to do anything that could delay the start of the invasion (for Israel).
    Campbell said that Murdoch had pledged that News International — the division which runs his British newspapers — would support Britain if it backed the United States on the issue . . .

    When I wrote “Barry & the Boys” almost ten years ago I had no idea that the story of America’s most famous drug smuggler would shortly have relevance to the biggest event of the still-young 21st Century, the 9/11 attack.

    But it did. And it still does.

    When a Lear-jet belonging to the owner of the flight school where Mohamed Atta had just begun flight training was seized in July 2000 carrying 43 lbs of heroin (according to the Orlando Sentinel, a Central Florida record) the story would have had huge implications for unanswered question about why Atta’s 9/11 terrorist cadre chose a tiny retirement community with the second oldest population in the entire United States as their home.
Would have had huge implications — except it was suppressed.


And the embarrassing fact that one of the men with drug smuggler and CIA pilot Barry Seal in the now-famous photograph on the cover of “Barry & the Boys’” was Porter Goss, picked in 2004 by President George W Bush to head America’s Central Intelligence Agency, would have been big news.

Would have been — except it, too, has been suppressed. See the pattern?

Currently over 100 books cite my two books as references, by Google’s count.   You might think this would be enough to excite interest from a major American publisher, especially since so many readers and reviewers seem to think highly of the book.

But you’d be wrong. None have expressed any interest. When my next book arrives, it will have been through my own efforts, and those of my friends, especially friend and courageous publisher Kris Millegan and his Trine Books out in Eugene, Oregon. That's about as far from the center of American publishing as you can get.


The much-noted author Salman Rushdie wrote a quite undiplomatic (for a rather gentlemanly diplomatic type man of the world) essay published in yesterday's NYT about how the relatively recent worry about offending anyone's sensibilities is causing the rebirth of any type of free-speech or freedom-of-thought movement (in the wake of the 9/11 scare) to be even further away from reality than the Age of Enlightenment was from the Renaissance (however you measure it).


THIS new idea — that writers, scholars and artists who stand against orthodoxy or bigotry are to blame for upsetting people — is spreading fast, even to countries like India that once prided themselves on their freedoms.
In recent years, the grand old man of Indian painting, Maqbool Fida Husain, was hounded into exile in Dubai and London, where he died, because he painted the Hindu goddess Saraswati in the nude (even though the most cursory examination of ancient Hindu sculptures of Saraswati shows that while she is often adorned with jewels and ornaments, she is equally often undressed).
Rohinton Mistry’s celebrated novel “Such a Long Journey” was pulled off the syllabus of Mumbai University because local extremists objected to its content.
The scholar Ashis Nandy was attacked for expressing unorthodox views on lower-caste corruption. And in all these cases the official view — with which many commentators and a substantial slice of public opinion seemed to agree — was, essentially, that the artists and scholars had brought the trouble on themselves. Those who might, in other eras, have been celebrated for their originality and independence of mind, are increasingly being told, “Sit down, you’re rocking the boat.”

America isn’t immune from this trend. The young activists of the Occupy movement have been much maligned (though, after their highly effective relief work in the wake of Hurricane Sandy, those criticisms have become a little muted). Out-of-step intellectuals like Noam Chomsky and the deceased Edward Said have often been dismissed as crazy extremists, “anti-American,” and in Mr. Said’s case even, absurdly, as apologists for Palestinian “terrorism.” (One may disagree with Mr. Chomsky’s critiques of America but it ought still to be possible to recognize the courage it takes to stand up and bellow them into the face of American power. One may not be pro-Palestinian, but one should be able to see that Mr. Said stood up against Yasir Arafat as eloquently as he criticized the United States.) 

It’s a vexing time for those of us who believe in the right of artists, intellectuals and ordinary, affronted citizens to push boundaries and take risks and so, at times, to change the way we see the world. There’s nothing to be done but to go on restating the importance of this kind of courage, and to try to make sure that these oppressed individuals — Ai Weiwei, the members of Pussy Riot, Hamza Kashgari — are seen for what they are: men and women standing on the front line of liberty. How to do this? Sign the petitions against their treatment, join the protests. Speak up. Every little bit counts.

And it does. But seemingly not in the U.S. of A. anymore.

Repeat after me:

I am not a pleasure unit (for the powers-that-be) anymore.



Saturday, April 27, 2013

Libor Outdone? Done Deal! (If You Thought Those Financial Catastrophes Seemed Rigged, Fooled You Twice - At Least) And You Thought the Courts Were Impartial?



Maybe done and done? How does this state of affairs go on and on after being so thoroughly exposed? Has everybody been paid off? Because, otherwise, nothing that has happened in the last decade (or maybe since the 80's?) in finance in general, in pricing in particular, and in the courts makes any sense. And how could the citizens who've witnessed their savings' (and, thus, their financially stable life's) disappearance not be in the streets putting heads on pikes? I'm guessing game theory, having so many adherents today, could provide one explanation. But should the one with the gold (who has figured out how to game the system in order to get the gold) be allowed to make the all the rules?

And who else but Matt Taibbi in the pages of Rolling Stone could make these facts of financially tenuous life in the U.S. of A. of today so crystal clear?

Everything Is Rigged: The Biggest Price-Fixing Scandal Ever


The Illuminati were amateurs. The second huge financial scandal of the year reveals the real international conspiracy: There's no price the big banks can't fix

Matt Taibbi

April 25, 2013 1:00 PM ET

(From Rolling Stone, May 9, 2013)

Conspiracy theorists of the world, believers in the hidden hands of the Rothschilds and the Masons and the Illuminati, we skeptics owe you an apology. You were right. The players may be a little different, but your basic premise is correct: The world is a rigged game. We found this out in recent months, when a series of related corruption stories spilled out of the financial sector, suggesting the world's largest banks may be fixing the prices of, well, just about everything.


You may have heard of the Libor scandal, in which at least three – and perhaps as many as 16 – of the name-brand too-big-to-fail banks have been manipulating global interest rates, in the process messing around with the prices of upward of $500 Trillion (that's Trillion, with a "T") worth of financial instruments.
When that sprawling con burst into public view last year, it was easily the biggest financial scandal in history – MIT professor Andrew Lo even said it "dwarfs by orders of magnitude any financial scam in the history of markets."
That was bad enough, but now Libor may have a twin brother. Word has leaked out that the London-based firm ICAP, the world's largest broker of interest-rate swaps, is being investigated by American authorities for behavior that sounds eerily reminiscent of the Libor mess. Regulators are looking into whether or not a small group of brokers at ICAP may have worked with up to 15 of the world's largest banks to manipulate ISDAfix, a benchmark number used around the world to calculate the prices of interest-rate swaps.
Interest-rate swaps are a tool used by big cities, major corporations and sovereign governments to manage their debt, and the scale of their use is almost unimaginably massive. It's about a $379 trillion market, meaning that any manipulation would affect a pile of assets about 100 times the size of the United States federal budget.
It should surprise no one that among the players implicated in this scheme to fix the prices of interest-rate swaps are the same megabanks – including Barclays, UBS, Bank of America, JPMorgan Chase and the Royal Bank of Scotland – that serve on the Libor panel that sets global interest rates.
In fact, in recent years many of these banks have already paid multimillion-dollar settlements for anti-competitive manipulation of one form or another (in addition to Libor, some were caught up in an anti-competitive scheme, detailed in Rolling Stone last year, to rig municipal-debt service auctions). Though the jumble of financial acronyms sounds like gibberish to the layperson, the fact that there may now be price-fixing scandals involving both Libor and ISDAfix suggests a single, giant mushrooming conspiracy of collusion and price-fixing hovering under the ostensibly competitive veneer of Wall Street culture.
The Scam Wall Street Learned From the Mafia
Why? Because Libor already affects the prices of interest-rate swaps, making this a manipulation-on-manipulation situation. If the allegations prove to be right, that will mean that swap customers have been paying for two different layers of price-fixing corruption. If you can imagine paying 20 bucks for a crappy PB&J because some evil cabal of agribusiness companies colluded to fix the prices of both peanuts and peanut butter, you come close to grasping the lunacy of financial markets where both interest rates and interest-rate swaps are being manipulated at the same time, often by the same banks.
"It's a double conspiracy," says an amazed Michael Greenberger, a former director of the trading and markets division at the Commodity Futures Trading Commission and now a professor at the University of Maryland. "It's the height of criminality."
The bad news didn't stop with swaps and interest rates. In March, it also came out that two regulators – the CFTC here in the U.S. and the Madrid-based International Organization of Securities Commissions – were spurred by the Libor revelations to investigate the possibility of collusive manipulation of gold and silver prices. "Given the clubby manipulation efforts we saw in Libor benchmarks, I assume other benchmarks – many other benchmarks – are legit areas of inquiry," CFTC Commissioner Bart Chilton said.
But the biggest shock came out of a federal courtroom at the end of March – though if you follow these matters closely, it may not have been so shocking at all – when a landmark class-action civil lawsuit against the banks for Libor-related offenses was dismissed.
In that case, a federal judge accepted the banker-defendants' incredible argument: If cities and towns and other investors lost money because of Libor manipulation, that was their own fault for ever thinking the banks were competing in the first place.
"A farce," was one antitrust lawyer's response to the eyebrow-raising dismissal.
"Incredible," says Sylvia Sokol, an attorney for Constantine Cannon, a firm that specializes in antitrust cases.
All of these stories collectively pointed to the same thing: These banks, which already possess enormous power just by virtue of their financial holdings – in the United States, the top six banks, many of them the same names you see on the Libor and ISDAfix panels, own assets equivalent to 60 percent of the nation's GDP – are beginning to realize the awesome possibilities for increased profit and political might that would come with colluding instead of competing.
Moreover, it's increasingly clear that both the criminal justice system and the civil courts may be impotent to stop them, even when they do get caught working together to game the system.
If true, that would leave us living in an era of undisguised, real-world conspiracy, in which the prices of currencies, commodities like gold and silver, even interest rates and the value of money itself, can be and may already have been dictated from above. And those who are doing it can get away with it. Forget the Illuminati – this is the real thing, and it's no secret. You can stare right at it, anytime you want.
The banks found a loophole, a basic flaw in the machine. Across the financial system, there are places where prices or official indices are set based upon unverified data sent in by private banks and financial companies. In other words, we gave the players with incentives to game the system institutional roles in the economic infrastructure.
Libor, which measures the prices banks charge one another to borrow money, is a perfect example, not only of this basic flaw in the price-setting system but of the weakness in the regulatory framework supposedly policing it.
Couple a voluntary reporting scheme with too-big-to-fail status and a revolving-door legal system, and what you get is unstoppable corruption.
Every morning, 18 of the world's biggest banks submit data to an office in London about how much they believe they would have to pay to borrow from other banks. The 18 banks together are called the "Libor panel," and when all of these data from all 18 panelist banks are collected, the numbers are averaged out. What emerges, every morning at 11:30 London time, are the daily Libor figures.
Banks submit numbers about borrowing in 10 different currencies across 15 different time periods, e.g., loans as short as one day and as long as one year. This mountain of bank-submitted data is used every day to create benchmark rates that affect the prices of everything from credit cards to mortgages to currencies to commercial loans (both short- and long-term) to swaps.
Gangster Bankers Broke Every Law in the Book
Dating back perhaps as far as the early Nineties, traders and others inside these banks were sometimes calling up the company geeks responsible for submitting the daily Libor numbers (the "Libor submitters") and asking them to fudge the numbers. Usually, the gimmick was the trader had made a bet on something – a swap, currencies, something – and he wanted the Libor submitter to make the numbers look lower (or, occasionally, higher) to help his bet pay off.
Famously, one Barclays trader monkeyed with Libor submissions in exchange for a bottle of Bollinger champagne, but in some cases, it was even lamer than that. This is from an exchange between a trader and a Libor submitter at the Royal Bank of Scotland:

SWISS FRANC TRADER: can u put 6m swiss libor in low pls?...
PRIMARY SUBMITTER: Whats it worth
SWSISS FRANC TRADER: ive got some sushi rolls from yesterday?...
PRIMARY SUBMITTER: ok low 6m, just for u
SWISS FRANC TRADER: wooooooohooooooo. . . thatd be awesome

Screwing around with world interest rates that affect billions of people in exchange for day-old sushi – it's hard to imagine an image that better captures the moral insanity of the modern financial-services sector.
Hundreds of similar exchanges were uncovered when regulators like Britain's Financial Services Authority and the U.S. Justice Department started burrowing into the befouled entrails of Libor.
The documentary evidence of anti-competitive manipulation they found was so overwhelming that, to read it, one almost becomes embarrassed for the banks. "It's just amazing how Libor fixing can make you that much money," chirped one yen trader. "Pure manipulation going on," wrote another.
Yet despite so many instances of at least attempted manipulation, the banks mostly skated. Barclays got off with a relatively minor fine in the $450 million range, UBS was stuck with $1.5 billion in penalties, and RBS was forced to give up $615 million. Apart from a few low-level flunkies overseas, no individual involved in this scam that impacted nearly everyone in the industrialized world was even threatened with criminal prosecution.
Two of America's top law-enforcement officials, Attorney General Eric Holder and former Justice Department Criminal Division chief Lanny Breuer, confessed that it's dangerous to prosecute offending banks because they are simply too big. Making arrests, they say, might lead to "collateral consequences" in the economy.
The relatively small sums of money extracted in these settlements did not go toward reparations for the cities, towns and other victims who lost money due to Libor manipulation. Instead, it flowed mindlessly into government coffers.
So it was left to towns and cities like Baltimore (which lost money due to fluctuations in their municipal investments caused by Libor movements), pensions like the New Britain, Connecticut, Firefighters' and Police Benefit Fund, and other foundations – and even individuals (billionaire real-estate developer Sheldon Solow, who filed his own suit in February, claims that his company lost $450 million because of Libor manipulation) – to sue the banks for damages.
One of the biggest Libor suits was proceeding on schedule when, early in March, an army of superstar lawyers working on behalf of the banks descended upon federal judge Naomi Buchwald in the Southern District of New York to argue an extraordinary motion to dismiss. The banks' legal dream team drew from heavyweight Beltway-connected firms like Boies Schiller (you remember David Boies represented Al Gore), Davis Polk (home of top ex-regulators like former SEC enforcement chief Linda Thomsen) and Covington & Burling, the onetime private-practice home of both Holder and Breuer.
The presence of Covington & Burling in the suit – representing, of all companies, Citigroup, the former employer of current Treasury Secretary Jack Lew – was particularly galling.
Right as the Libor case was being dismissed, the firm had hired none other than Lanny Breuer, the same Lanny Breuer who, just a few months before, was the assistant attorney general who had balked at criminally prosecuting UBS over Libor because, he said, "Our goal here is not to destroy a major financial institution."
In any case, this all-star squad of white-shoe lawyers came before Buchwald and made the mother of all audacious arguments. Robert Wise of Davis Polk, representing Bank of America, told Buchwald that the banks could not possibly be guilty of anti-competitive collusion because nobody ever said that the creation of Libor was competitive. "It is essential to our argument that this is not a competitive process," he said. "The banks do not compete with one another in the submission of Libor."
If you squint incredibly hard and look at the issue through a mirror, maybe while standing on your head, you can sort of see what Wise is saying. In a very theoretical, technical sense, the actual process by which banks submit Libor data – 18 geeks sending numbers to the British Bankers' Association offices in London once every morning – is not competitive per se.
But these numbers are supposed to reflect interbank-loan prices derived in a real, competitive market. Saying the Libor submission process is not competitive is sort of like pointing out that bank robbers obeyed the speed limit on the way to the heist. It's the silliest kind of legal sophistry.
But Wise eventually outdid even that argument, essentially saying that while the banks may have lied to or cheated their customers, they weren't guilty of the particular crime of antitrust collusion. This is like the old joke about the lawyer who gets up in court and claims his client had to be innocent, because his client was committing a crime in a different state at the time of the offense.
"The plaintiffs, I believe, are confusing a claim of being perhaps deceived," he said, "with a claim for harm to competition."
Judge Buchwald swallowed this lunatic argument whole and dismissed most of the case. Libor, she said, was a "cooperative endeavor" that was "never intended to be competitive." Her decision "does not reflect the reality of this business, where all of these banks were acting as competitors throughout the process," said the antitrust lawyer Sokol.
Buchwald made this ruling despite the fact that both the U.S. and British governments had already settled with three banks for billions of dollars for improper manipulation, manipulation that these companies admitted to in their settlements.
Michael Hausfeld of Hausfeld LLP, one of the lead lawyers for the plaintiffs in this Libor suit, declined to comment specifically on the dismissal. But he did talk about the significance of the Libor case and other manipulation cases now in the pipeline.
"It's now evident that there is a ubiquitous culture among the banks to collude and cheat their customers as many times as they can in as many forms as they can conceive," he said. "And that's not just surmising. This is just based upon what they've been caught at."
Greenberger says the lack of serious consequences for the Libor scandal has only made other kinds of manipulation more inevitable. "There's no therapy like sending those who are used to wearing Gucci shoes to jail," he says. "But when the attorney general says, 'I don't want to indict people,' it's the Wild West. There's no law."
The problem is, a number of markets feature the same infrastructural weakness that failed in the Libor mess. In the case of interest-rate swaps and the ISDAfix benchmark, the system is very similar to Libor, although the investigation into these markets reportedly focuses on some different types of improprieties.
. . . After scandals involving Libor and, perhaps, ISDAfix, the question that should have everyone freaked out is this: What other markets out there carry the same potential for manipulation? The answer to that question is far from reassuring, because the potential is almost everywhere. From gold to gas to swaps to interest rates, prices all over the world are dependent upon little private cabals of cigar-chomping insiders we're forced to trust. 
"In all the over-the-counter markets, you don't really have pricing except by a bunch of guys getting together," Masters notes glumly.
That includes the markets for gold (where prices are set by five banks in a Libor-ish teleconferencing process that, ironically, was created in part by N M Rothschild & Sons) and silver (whose price is set by just three banks), as well as benchmark rates in numerous other commodities – jet fuel, diesel, electric power, coal, you name it.
The problem in each of these markets is the same: We all have to rely upon the honesty of companies like Barclays (already caught and fined $453 million for rigging Libor) or JPMorgan Chase (paid a $228 million settlement for rigging municipal-bond auctions) or UBS (fined a collective $1.66 billion for both muni-bond rigging and Libor manipulation) to faithfully report the real prices of things like interest rates, swaps, currencies and commodities.
All of these benchmarks based on voluntary reporting are now being looked at by regulators around the world, and God knows what they'll find. The European Federation of Financial Services Users wrote in an official EU survey last summer that all of these systems are ripe targets for manipulation.
"In general," it wrote, "those markets which are based on non-attested, voluntary submission of data from agents whose benefits depend on such benchmarks are especially vulnerable of market abuse and distortion."
Translation: When prices are set by companies that can profit by manipulating them, we're fucked.
"You name it," says Frenk. "Any of these benchmarks is a possibility for corruption."
The only reason this problem has not received the attention it deserves is because the scale of it is so enormous that ordinary people simply cannot see it. It's not just stealing by reaching a hand into your pocket and taking out money, but stealing in which banks can hit a few keystrokes and magically make whatever's in your pocket worth less. This is corruption at the molecular level of the economy, Space Age stealing – and it's only just coming into view.

Not really so far away.

Garbage eruption!



Friday, April 26, 2013

Deregulation and Privatization: Two Incredibly Bad Ideas (But There Is No Alternative - Koch Botched Corps.)



And not just "bad ideas." Civilization wrecking ideas.

But not for the 1%.


The 1 Percent’s Solution


By Paul Krugman

April 25, 2013

Comments


Economic debates rarely end with a T.K.O. But the great policy debate of recent years between Keynesians, who advocate sustaining and, indeed, increasing government spending in a depression, and austerians, who demand immediate spending cuts, comes close — at least in the world of ideas. At this point, the austerian position has imploded; not only have its predictions about the real world failed completely, but the academic research invoked to support that position has turned out to be riddled with errors, omissions and dubious statistics.


Yet two big questions remain. First, how did austerity doctrine become so influential in the first place? Second, will policy change at all now that crucial austerian claims have become fodder for late-night comics?

On the first question: the dominance of austerians in influential circles should disturb anyone who likes to believe that policy is based on, or even strongly influenced by, actual evidence. After all, the two main studies providing the alleged intellectual justification for austerity — Alberto Alesina and Silvia Ardagna on “expansionary austerity” and Carmen Reinhart and Kenneth Rogoff on the dangerous debt “threshold” at 90 percent of G.D.P. — faced withering criticism almost as soon as they came out.

And the studies did not hold up under scrutiny. By late 2010, the International Monetary Fund had reworked Alesina-Ardagna with better data and reversed their findings, while many economists raised fundamental questions about Reinhart-Rogoff long before we knew about the famous Excel error.

Meanwhile, real-world events — stagnation in Ireland, the original poster child for austerity, falling interest rates in the United States, which was supposed to be facing an imminent fiscal crisis — quickly made nonsense of austerian predictions.
Yet austerity maintained and even strengthened its grip on elite opinion. Why?
Part of the answer surely lies in the widespread desire to see economics as a morality play, to make it a tale of excess and its consequences. We lived beyond our means, the story goes, and now we’re paying the inevitable price.
Economists can explain ad nauseam that this is wrong, that the reason we have mass unemployment isn’t that we spent too much in the past but that we’re spending too little now, and that this problem can and should be solved. No matter; many people have a visceral sense that we sinned and must seek redemption through suffering — and neither economic argument nor the observation that the people now suffering aren’t at all the same people who sinned during the bubble years makes much of a dent.
But it’s not just a matter of emotion versus logic. You can’t understand the influence of austerity doctrine without talking about class and inequality.
What, after all, do people want from economic policy? The answer, it turns out, is that it depends on which people you ask — a point documented in a recent research paper by the political scientists Benjamin Page, Larry Bartels and Jason Seawright. The paper compares the policy preferences of ordinary Americans with those of the very wealthy, and the results are eye-opening.
Thus, the average American is somewhat worried about budget deficits, which is no surprise given the constant barrage of deficit scare stories in the news media, but the wealthy, by a large majority, regard deficits as the most important problem we face. And how should the budget deficit be brought down? The wealthy favor cutting federal spending on health care and Social Security — that is, “entitlements” — while the public at large actually wants to see spending on those programs rise.
You get the idea: The austerity agenda looks a lot like a simple expression of upper-class preferences, wrapped in a facade of academic rigor. What the top 1 percent wants becomes what economic science says we must do.
Does a continuing depression actually serve the interests of the wealthy? That’s doubtful, since a booming economy is generally good for almost everyone.
What is true, however, is that the years since we turned to austerity have been dismal for workers but not at all bad for the wealthy, who have benefited from surging profits and stock prices even as long-term unemployment festers. The 1 percent may not actually want a weak economy, but they’re doing well enough to indulge their prejudices.
And this makes one wonder how much difference the intellectual collapse of the austerian position will actually make. To the extent that we have policy of the 1 percent, by the 1 percent, for the 1 percent, won’t we just see new justifications for the same old policies?
I hope not; I’d like to believe that ideas and evidence matter, at least a bit. Otherwise, what am I doing with my life? But I guess we’ll see just how much cynicism is justified.


If you've wondered whether historians (and political science profs) were asleep worldwide the last 30 years (or just basking in the corporate cash like all the rest of those in charge), you'd be surprised to find out that some were awake and writing some very revealing books.

There are even a few blueprints available showing a way out of this downworld maze, but as there are no easy choices left, it won't be a cake walk (Thanks, Comeback Dumbya!).

Not even an interesting play on words.

Post-Democracy: Where States Answer Only To Business


April 25, 2013

Henry Farrell, who was asked to speak at the summer school for Il Partito Democratico, the Italian Democratic Party, in Cortona last year, writes:

This isn’t what was supposed to happen.
In the 1990s and the 2000s, right-wing parties were the enthusiasts of the market, pushing for the deregulation of banks, the privatisation of core state functions and the whittling away of social protections. All of these now look to have been very bad ideas. The economic crisis should really have discredited the right, not the left. So why is it the left that is paralysed?

Colin Crouch’s disquieting little book, Post-Democracy (2005), provides one plausible answer. Crouch is a British academic who spent several years teaching at the European University Institute in Florence, where he was my academic supervisor. His book has been well read in the UK, but in continental Europe its impact has been much more remarkable. Though he was not at the Cortona summer school in person, his ideas were omnipresent. Speaker after speaker grappled with the challenge that his book threw down. The fear that he was right, that there was no palatable exit from our situation, hung over the conference like a dusty pall.

Crouch sees the history of democracy as an arc. In the beginning, ordinary people were excluded from decision-making. During the 20th century, they became increasingly able to determine their collective fate through the electoral process, building mass parties that could represent their interests in government. Prosperity and the contentment of working people went hand in hand. Business recognised limits to its power and answered to democratically legitimated government. Markets were subordinate to politics, not the other way around.

At some point shortly after the end of the Second World War, democracy reached its apex in countries such as Britain and the US. According to Crouch, it has been declining ever since. Places such as Italy had more ambiguous histories of rise and decline, while others still, including Spain, Portugal and Greece, began the ascent much later, having only emerged from dictatorship in the 1970s. Nevertheless, all of these countries have reached the downward slope of the arc.

The formal structures of democracy remain intact. People still vote. Political parties vie with each other in elections, and circulate in and out of government. Yet these acts of apparent choice have had their meaning hollowed out. The real decisions are taken elsewhere. We have become squatters in the ruins of the great democratic societies of the past.

Crouch lays some blame for this at the feet of the usual suspects. As markets globalise, businesses grow more powerful (they can relocate their activities, or threaten to relocate) and governments are weakened. Yet the real lessons of his book are about more particular forms of disconnection.
Neo-liberalism, which was supposed to replace grubby politics with efficient, market-based competition, has led not to the triumph of the free market but to the birth of new and horrid chimeras. The traditional firm, based on stable relations between employer, workers and customers, has spun itself out into a complicated and ever-shifting network of supply relationships and contractual forms. The owners remain the same but their relationship to their employees and customers is very different. For one thing, they cannot easily be held to account.
As the American labour lawyer Thomas Geoghegan and others have shown, US firms have systematically divested themselves of inconvenient pension obligations to their employees, by farming them out to subsidiaries and spin-offs.
Walmart has used hands-off subcontracting relationships to take advantage of unsafe working conditions in the developing world, while actively blocking efforts to improve industry safety standards until 112 garment workers died in a Bangladesh factory fire in November last year. Amazon uses subcontractors to employ warehouse employees in what can be unsafe and miserable working conditions, while minimising damage to its own brand.
Instead of clamping down on such abuses, the state has actually tried to ape these more flexible and apparently more efficient arrangements, either by putting many of its core activities out to private tender through complex contracting arrangements or by requiring its internal units to behave as if they were competing firms.
As one looks from business to state and from state to business again, it is increasingly difficult to say which is which. The result is a complex web of relationships that are subject neither to market discipline nor democratic control. Businesses become entangled with the state as both customer and as regulator. States grow increasingly reliant on business, to the point where they no longer know what to do without its advice.
Responsibility and accountability evanesce into an endlessly proliferating maze of contracts and subcontracts. As Crouch describes it, government is no more responsible for the delivery of services than Nike is for making the shoes that it brands. The realm of real democracy — political choices that are responsive to voters’ needs — shrinks ever further.
Politicians, meanwhile, have floated away, drifting beyond the reach of the parties that nominally chose them and the voters who elected them. They simply don’t need us as much as they used to. These days, it is far easier to ask business for money and expertise in exchange for political favours than to figure out the needs of a voting public that is increasingly fragmented and difficult to understand anyway. 
Both the traditional right, which always had strong connections to business, and the new left, which has woven new ties in a hurry, now rely on the private sector more than on voters or party activists. As left and right grow ever more disconnected from the public and ever closer to one another, elections become exercises in branding rather than substantive choice.
Crouch was writing Post-Democracy 10 years ago, when most people thought that things were going quite well. As long as the economy kept delivering jobs and growth, voters didn’t seem to mind about the hollowing out of democracy. Left-of-centre parties weren’t worried either: they responded to the new incentives by trying to articulate a ‘Third Way’ of market-like initiatives that could deliver broad social benefits. Crouch's lessons have only really come home in the wake of the economic crisis.
The problem that the centre-left now faces is not that it wants to make difficult or unpopular choices. It is that no real choices remain. It is lost in the maze, able neither to reach out to its traditional bases of support (which are largely dying or alienated from it anyway) nor to propose any grand new initiatives, the state no longer having the tools to implement them. When the important decisions are all made outside of democratic politics, the centre-left can only keep going through the ritualistic motions of democracy, all the while praying for intercession.
Most left-wing parties face some version of these dilemmas. Cronyism is less a problem than an institution in the US, where decision-makers relentlessly circulate between Wall Street, K Street, and the Senate and Congress. Yet Europe has some particular bugbears of its own. Even if national political systems were by some miracle to regain their old responsiveness, the power of decision has moved to the European Union, which is dominated by a toxic combination of economic realpolitik and bureaucratic self-interest. Rich northern states are unwilling to help their southern neighbours more than is absolutely necessary; instead they press for greater austerity. The European Central Bank, which was deliberately designed to be free of democratic oversight, is becoming ever more important, and ever more political. Social democrats once looked to the EU as a bulwark against globalisation — perhaps even a model for how the international economy might be subjected to democratic control. Instead, it is turning out to be a vector of corrosion, demanding that weaker member states implement drastic economic reforms without even a pretence of consultation.
Let’s return to Italy, the laboratory of post-democracy’s most grotesque manifestations. Forza Italia, Silvio Berlusconi’s elaborate simulacrum of a political party, is a perfect exemplar of Crouch’s thesis: a thin shell of branding and mass mobilisation, with a dense core of business and political elites floating free in the vacuum within.
After the Cortona summer school, Bersani won his fight with Renzi in November last year and led his party into the general election. His coalition lost 3.5 million votes but still won the lower house in February, because the Italian electoral system gives a massive bonus to the biggest winner. It fell far short of a majority in the upper house and is doing its hapless best to form a government. Grillo’s Five Star Movement, on the other hand, did far better than anyone expected, winning a quarter of the votes. Grillo has made it clear that his party will not support the Democratic Party. Renzi has tried to advance himself again as a compromise leader who might be more acceptable to Grillo, so far without success. In all likelihood there will be a second general election in a few months.
The Italian Democratic Party is caught on one tine of the post-democratic dilemma. It is trying to work within the system as it is, in the implausible hope that it can produce real change within a framework that almost seems designed to prevent such a thing. As the party has courted Grillo, it has started making noises about refusing to accept austerity politics and introducing major institutional reforms. It is unclear whether senior Democratic figures believe their new rhetoric; certainly no one else does. If the party does somehow come to power, the most it will do is tinker with the system.
The Five Star Movement has impaled itself on the other tine, as have the Indignados in Spain, Occupy in the US and UK, and the tent movement in Israel. All have gained mass support because of the problems of post-democracy. The divide between ordinary people and politicians has grown ever wider, and Italian politicians are often corrupt as well as remote.
The Five Star Movement wants to reform Italy’s institutions to make them truly democratic. Yet it, too, is trapped by the system. As Grillo told the Financial Times in October: ‘We die if a movement becomes a party. Our problem is to remain a movement in parliament, which is a structure for parties. We have to keep a foot outside.’
The truth is, if the Five Star Movement wants to get its proposals for radical change through the complex Italian political system, it will need to compromise, just as other parties do. Grillo’s unwillingness even to entertain discussions with other parties that share his agenda is creating fissures within his movement. Grillo is holding out for a more radical transformation, in which Italian politics would be replaced by new forms of internet-based ‘collective intelligence’, allowing people to come together to solve problems without ugly partisan bargaining. In order to save democracy, the Five Star Movement would like to leave politics behind. It won’t work.
The problems of the Italian left are mirrored in other countries. The British Labour Party finds itself in difficulty, wavering between a Blairite Third Wayism that offers no clear alternative to the present government, and a more full-blooded social democracy that it cannot readily define. The French left has mired itself in scandal and confusion. The Greek left is divided between a social democratic party that is more profoundly compromised than its Italian equivalent and a loose coalition of radicals that wants to do anything and everything except find itself in power and be forced to take decisions.
All are embroiled, in different ways, in the perplexities of post-democracy. None has any very good way out. Ever since France’s president François Mitterrand tried to pursue an expansive social democratic agenda in the early 1980s and was brutally punished by international markets, it has been clear that social democracy will require either a partial withdrawal from the international economy, with all the costs that this entails, or a radical transformation of how the international economy works.
It is striking that the right is not hampered to nearly the same extent. Many mainstream conservatives are committed to democracy for pragmatic rather than idealistic reasons. They are quite content to see it watered down so long as markets work and social stability is maintained. Those on the further reaches of the right, such as Greece’s Golden Dawn, find it much easier than the Five Star Movement or Syriza, the Greek radical-left coalition, to think about alternatives.
After all, they aren’t particularly interested in reforming moribund democratic institutions to make them better and more responsive; they just want to replace them with some version of militaristic fascism. Even if these factions are unlikely to succeed, they can still pull their countries in less democratic directions, by excluding weaker groups from political protection. The next 10 years are unlikely to be comfortable for immigrants in southern Europe.
Post-democracy is strangling the old parties of the left. They have run out of options. Perhaps all that traditional social democracy can do, to adapt a grim joke made by Crouch in a different context, is to serve as a pall-bearer at its own funeral.
In contrast, a new group of actors — the Five Star Movement and other confederations of the angry, young and dispossessed — have seized a chance to win mass support. The problem is, they seem unable to turn mass frustration into the power to change things, to create a path for escape.
Perhaps, over time, they will figure out how to engage with the mundane task of slow drilling through hard boards that is everyday politics. Perhaps, too, the systems of unrule governing the world economy, gravely weakened as they are, will fail and collapse of their own accord, opening the space for a new and very different dispensation. Great changes seem unlikely until they happen; only in retrospect do they look inevitable. Yet if some reversal in the order of things is waiting to unfold, it is not apparent to us now. Post-democracy has trapped the left between two worlds, one dead, the other powerless to be born. We may be here for some time.
(Henry Farrell is an associate professor of political science and international affairs at George Washington University. His latest book is The Political Economy of Trust (2009).)

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