Friday, May 30, 2014

Are We Headed To the “Bloodiest Thing the World Has Seen” Or Just Another Orchestrated American Disaster Rewarding the Connected/Rich?



Piketty — whose work I relied on for years and who substantiates a lot of things that I’ve written with his research — argues that the concentration of wealth will just continue and continue and continue. As Herbert Stein, Richard Nixon’s chief economic adviser, famously said, a trend will only continue as long as it can. We will either, through peaceful, rational means, go back to a system that does not take from the many to give to the few in all these subtle ways, or we will end up like 18th century France. And if we end up in that awful condition, it will be the bloodiest thing the world has even seen.

So I think it’s really important to get a handle on this inequality. After all, since the end of the Great Recession, one-third of all income increases in this country went to just 16,000 households, 95 percent of it went to the top 1 percent, and the bottom 90 percent’s incomes fell, and they fell by 15 percent. So we need to recognize that there is a very, very serious problem here that has to get addressed. But it won’t just go on forever because if you follow that to its logical absurdity, one person ends up with 90 percent of the wealth in the world. And that’s not going to happen.

[In the aforementioned email, Johnston also followed up on this point, writing:  "While I certainly am worried that we could end up in a violent revolution somewhere in the future, sparked by extreme inequality,  I’m [an] indictable optimist and believe that [if] the American people have access to explanations and information they will, over the long run, make smart choices.”]

So, now that the inequality argument has been joined (almost worldwide), what can we, the people, do to heal this ever-deepening bloody hole in our body politic and achieve some 21st-century representative democracy driven up from the catastrophic distress of those at the bottom of the wealth/sweat pyramid? Or does change ever come from the bottom (outside of the French/Russian Revolution variety)?

Before Piketty's book/thesis was promulgated and became so publicly discussed we had many fine writer/reporter/researchers who presented these very facts without the surrounding, now peer-reviewed, data (which may in fact, actually understate the true extent of growth in the concentration of wealth), and warned of calamity unless real economic change was implemented before the pressures at the bottom cause the national pot(s) to boil over.

Many will say that this was what we thought we had voted for Obama to accomplish by leading from the top. As his financial and collegial ties to the banking world soon showed how mixed (misleading) his campaign rhetoric/signals were, many of us lost hope in any type of equity changes at all coming from the "liberal" negotiators.

And, of course, the radical conservatives negotiating from the other side always only offered a further deepening of the inequity morass (to loud cheers from the upper levels).

So, the question still reverberates in the bell jar:  Will we go forward to more equitable solutions or let the blame be misdirected again (which has always been the economic powers' sleight of hand answer) back onto us (whom Romney called to great applause "the takers")?

. . . Madison and Monroe and Jefferson — there was a lot of concern about this. They were fearful not just of a hereditary aristocracy but a business aristocracy. And I’ve had my research assistants at Syracuse Law working on this for the last two-and-a-half years and there was an abundance of material written in that era that was concerned about extreme inequality. And that’s what we have in America, is extreme inequality.

. . . We’re still living in the age of Reaganism; that has not come to an end yet. But we now have 33 years of empirical evidence that what Reagan promised didn’t work. If it did, if what Reagan and George W. Bush promised us worked, we would be swimming in jobs today. And we’re not. So I’m afraid, in the short run, what we’re going to see is an effort to shift the blame for this from failed policies to us. The “it’s the 47 percent who are takers” argument that Romney put forth, rather than looking at the structure and the rules that create and reinforce inequality. But this must come to an end and we have to get some changes and what’s missing are leaders who can articulate a new path.

“Bloodiest Thing the World Has Seen”:  Inequality’s Looming Disaster

Pulitzer Prize winner David Cay Johnston tells Salon how America's economic story could end - and it isn't pretty

Elias Isquith

May 22, 2014

Long before anyone knew the name Thomas Piketty, Pulitzer Prize-winning journalist David Cay Johnston was plumbing the hidden depths of the American tax code, revealing the myriad ways it privileges the interests of corporations and the wealthy ahead of those of the 99 percent. Indeed, while it may sometimes feel as if economic inequality is the new trend, Johnston’s career reminds us that the great gulf that separates the rich from the rest in the contemporary United States didn’t happen overnight, but over a course of decades.

Despite coming out during the same year as “Capital in the Twenty-First Century,” and “The Divide,” Johnston’s newest release, “Divided:  The Perils of Our Growing Inequality,” is a different kind of inequality book. Rather than a sweeping overview of centuries of economic history, or an on-the-ground examination of how our justice system ignores the powerful while brutalizing the rest, Johnston’s book is a collection of essays, speeches and excerpts — a kind of inequality reader. Featuring insights from philosophers, economists, journalists, researchers and even politicians, “Divided” reminds us how inequality is one of those rare problems that truly matters to all of us, no matter what our interests or chosen field.

Earlier this week, Salon reached Johnston via telephone to discuss “Divided,” whether American democracy can survive such great economic disparities, and how returning to a more equal society is literally a matter of life and death. Our conversation follows, and has been slightly edited for clarity and length. In addition, Johnston followed up with further thoughts via email.

What inspired you to create this book?

I had done a trilogy on hidden aspects of the American economy, “Perfectly Legal,” which was about how the rich benefit from taxes, “Free Lunch,” about all the subsidies people didn’t know about that go to rich people and corporations, and “The Fine Print,” which was about restraint of trade and monopolies. And in speaking for the last 10 years around the country, one of the things I learned is that people didn’t understand that this isn’t just a function of numbers and whatnot; they didn’t understand there’s a whole structure that affects families, health, healthcare — which are different things — incarceration, opportunity, exposure to environmental hazards, wage theft and so, there was really a need here to give people a broad understanding of, well, “How did this come about, this incredible inequality that we didn’t have in this country until recent years?”

[After the interview, Johnston emailed to add:  "My trilogy on the American economy explained many of the little-known, and often deceptive, laws, regulations and official practices. But inequality involves much more than what I had written about in the trilogy. I wanted to provide people with a broad understanding of the issues, ranging from limited opportunity and obstacles to achieving a modicum of prosperity, to the remarkably cruel and thoughtless policies of the Reagan era."]

In your introductory essay, you make a point of arguing that inequality is not natural, that it’s something we created and, by extensions, we can undo. But what would you say to those who, say, have read their Piketty and are thinking this kind of inequality is endemic to capitalism?

Well, Piketty — whose work I relied on for years and who substantiates a lot of things that I’ve written with his research — argues that the concentration of wealth will just continue and continue and continue. As Herbert Stein, Richard Nixon’s chief economic adviser, famously said, a trend will only continue as long as it can. We will either, through peaceful, rational means, go back to a system that does not take from the many to give to the few in all these subtle ways, or we will end up like 18th century France. And if we end up in that awful condition, it will be the bloodiest thing the world has even seen.

So I think it’s really important to get a handle on this inequality. After all, since the end of the Great Recession, one-third of all income increases in this country went to just 16,000 households, 95 percent of it went to the top 1 percent, and the bottom 90 percent’s incomes fell, and they fell by 15 percent. So we need to recognize that there is a very, very serious problem here that has to get addressed. But it won’t just go on forever because if you follow that to its logical absurdity, one person ends up with 90 percent of the wealth in the world. And that’s not going to happen.

[In the aforementioned email, Johnston also followed up on this point, writing:  "While I certainly am worried that we could end up in a violent revolution somewhere in the future, sparked by extreme inequality,  I’m [an] indictable optimist and believe that [if] the American people have access to explanations and information they will, over the long run, make smart choices.”]

So when you say it will be very bloody, I know you’re speaking of a wild hypothetical to some degree, but do you really think we’re on track for violent social upheaval?

Oh, yes. I’ve written about people on the far right and the far left since the ’60s. Back in the ’60s, I was in the homes of people who built bombs, both left and right. And we live in a country now where we have members of Congress who have either questioned, or ignored questions about, killing the president of the United States.

We are seeing all these laws passed allowing people to carry guns openly. We are coming apart as a society, and inequality is right at the core of that. When the 90 percent are getting worse off, and they’re trying to figure out what happened, they’re not people like me who get to spend four or five hours a day studying these things and then writing about them — they’re people who have to make a living and get through life. And they’re going to be swayed by demagogues and filled with fear about the other, rather than bringing us together.

When you mention demagogues, are there people currently on the scene that give you a shiver up your spine in that regard, or are you speaking hypothetically?

I think it would be easy for someone to arrive in the near future and really create forces that would lead to trouble in this country. And you see people who, they’re not the leaders to pull it off, but we have suggestions that the president should be killed, that he’s not an American, that Texas can secede, that states can ignore federal law, and these are things that don’t lack for antecedents in America  history but they’re clearly on the rise.

In addition to that, we have this large, very well-funded news organization that is premised on misconstruing facts and telling lies, Faux News (formerly Fox News), that is creating, in a large segment of the population — somewhere around one-fifth and one-fourth of it — belief in all sorts of things that are detrimental to our well-being. President Theodore Roosevelt said we shall all rise together or we shall all fall together, and we need to have an appreciation of that.

So, no, I don’t see this happening tomorrow, but I have said for many years that … if we don’t get a handle on this then one of these days our descendants are going to sit down in high-school history class and open a textbook that begins with the words:  “The United States of America was…” and then it will dissect how our experiment in self-governance came apart.

By the way, the Founders were very worried about this. John Adams said his fear was that instead of having yeoman farmers who owned their own land, and workers who owned their own tools and therefore were independent, that we would become a country in which a business aristocracy would arise, and the mass of people would simply work for wages and the business aristocrats would persuade the wage-earners to support those policies that were actually against their interest and favor the business aristocrats and, when that happened, we would lose our liberties and our democracy.

And he wasn’t exactly the proto-lefty bomb-thrower of the group …

No, but Madison and Monroe and Jefferson — there was a lot of concern about this. They were fearful not just of a hereditary aristocracy but a business aristocracy. And I’ve had my research assistants at Syracuse Law working on this for the last two-and-a-half years and there was an abundance of material written in that era that was concerned about extreme inequality. And that’s what we have in America, is extreme inequality.

To turn from how bad things are getting to how we can make them better, I’d like to ask you what solutions you’d like to see people organize around in terms of reducing inequality?

Number one, we’ve got to change the makeup of Congress. The Democrats got 1.4 million more votes than the Republicans [in 2010] but they have a minority [in Congress] because of gerrymandering. So we need to have state legislatures — and we may need a constitutional amendment to make districts evenly divided between the parties — that will get us more centrist candidates rather than extremists on both left and right.

Secondly, we’ve got to restore unions. If you believe in market economics, you’ve gotta believe in unions. Now, unions aren’t perfect, but neither are corporations, or the government or, for god’s sake, the clergy. Unions allow people as a group to negotiate for reasonable pay, and without unions you have big corporations, and individuals who have no bargaining power, such as a lot of unemployed workers. Our competitors all have unions. The Germans even have unions for executives. So we need to get back to unions if we’re going to improve people’s economics.

We need to get people to vote. If the bottom 90 percent voted at the same rate that the top 1 percent do, you would have a different Congress. That’s why you’re seeing efforts to take away the franchise, because the serious professionals in the Republican Party recognize that the demographic trends are going against them, and to stave that off they’ve got to try and deny the franchise to people, which is an extraordinary move, something we haven’t seen since Jim Crow.

We need to have a big enough government to enforce the law. We have not prosecuted any of the “too big to fail” banks and we have a president who has said, Well, these things look awful, but they may not be crimes. I’m sorry — the banks falsely certified documents … there are plenty of witnesses who have emails and memos they wrote and can testify that they said that this is illegal and wrong and they were told to shut up or were gotten rid of.

We have money transferred through the mail and through the wires. That’s all you need to prosecute fraud. And yet, Bill Black, the guy who got us all those convictions in the savings and loan crisis, no one will speak to him. That’s just one example. I have written about all sorts of lawless behavior that’s going on, involving cheating in the real-estate industry, the failure to pay out benefits in the insurance industry, and when you “deregulate” and cut the staffs whose job is to look out for the public, the most cunning and conniving are the beneficiaries.

And this is also true in tax; the wage-earners will be taxed very effectively because it’s all automated. But those people who have very complicated individual or investment or corporate tax portfolios, Congress has cut away the ability to — and put in place rules that make it really impossible to — enforce the laws. So America today has two income taxes separate and unequal, one for wage earners who are thoroughly and efficiently taxed, and one for investors, business owners and corporations, who the government does not have the capacity to properly tax, and therefore are undertaxed, shifting the burden onto the wage earners.

To that point, it’s died down now that the elections are coming up, but there was previously a lot of talk of “tax reform” —

Well, I’ve said repeatedly, there is no discussion in Washington of tax “reform,” a word journalists should use in quotes. There is a lot of talk of shifting the burden of taxes off of corporations and wealthy Americans. But reform means making the system better, and there’s nothing being proposed that’s reform. When Ronald Reagan’s two big tax policy changes were made, there were giant studies by the Treasury where they tried to figure out everything about the effects of this. There’s no serious intellectual work going on about how do we design a tax system for the 21st century.

Let me give you one of my lines on it:  America has a tax system that is well-designed and effective for the middle of the 20th century. We now live in the 21st century. We are not a national industrial wage economy — we are a global services/asset economy. Mostly intangible assets. And the tax system does not recognize this. Therefore, it is damaging the economy rather than strengthening and providing for the commonwealth goods and services that are needed for private wealth creation.

Barack Obama has made a point to be seen as sort of like the president who put inequality on the front burner. And you include his speech from 2011 in Osawatomie, Kansas (where Teddy Roosevelt gave his famous “New Nationalism” address), in the book. But at the same time, as you’ve noted, 95 percent of the gains, post-Great Recession, have gone to the tippy-top of the economic pyramid. How do you judge him on this issue?

President Obama understands the broad nature of the problem and he’s right to say this is the issue of our time. But his policies simply reinforce inequality. His policies show that he very much identifies with Wall Street and with its interests. Remember, he was going to put Lawrence Summers in as head of the Federal Reserve, and a whole bunch of people — and I was among them — [said] that this would be a terrible policy mistake, that Janet Yellen is among the group of people who consistently predicted things correctly and gotten it right (and I would count among them Dean Baker, me, Paul Krugman, Joe Stiglitz and a few dozen other people who deal with these issues in public).

The president has consistently sided with Wall Street, whether it’s not prosecuting the criminality which brought down the economy in 2008, or supporting the Trans-Pacific Partnership — which is not about “free trade,” it’s about protecting existing ownership interests against the future. And so he’s just a really good example of where what he says and what he does don’t align. I don’t know the explanation for that. But having watched him very closely, I think it has to do in part with [that] he wants very much to be … the great uniter. And if you’re going to bring about the kind of change I think we need, there’s going to be a lot of divisiveness about it; and he just doesn’t have a stomach for it, it’s not who he is. He’s the “Can we please get along here together?” guy.

Garry Wills once described his approach as “omnidirectional placation.”

That’s a great line … I mean, he’s like the child from the family where the parents fought and that child was the one who’d get the parents to make peace. And he really does identify very heavily with the folks on Wall Street.

Here’s [former Treasury Secretary] Timothy Geithner who flat-out cheated — calculated deliberately — on his taxes and lied to Congress about it. And I can tell you that because I replicated his taxes in TurboTax, which was a hell of a lot of work. And I know somebody who was a deep expert/authority who did the same thing. We could not produce, without overriding the system, what he said. And all he had to do to be honorable about this was pay the penalties as well as the taxes and interest. But look at Geithner, look at everything he’s done. Did Geithner do anything for the homeowners who got taken to the cleaners, here? You didn’t have to take out a mortgage to get taken to the cleaners; property values fell for everybody. People who had nothing to do with taking out these bad mortgages were harmed.

Now, every single thing you saw Geithner do was to benefit Wall Street. And Obama spoke well of him right to the moment [Geithner] decided to earn his reward and go to work on Wall Street.

Obama was even, before he moved on to not-better Summers, considering nominating Geithner for the Fed.

Yes. I recognize that Obama has been dealt a terrible hand. Ten days after his inauguration in 2009, top Republicans had a meeting and agreed that making him ineffective was their overriding goal. He’s been dealt a terrible hand, here, and in some ways he’s played it well. But on the fundamental issues of what’s driving our inequality, he has not played this at all well.

He has a very deep knowledge of strategic arms, because that’s what he studied when he was in college; [but] I don’t think he has a deeper understanding of economics than your average college graduate, and your average college graduate doesn’t have a very good understanding of economics. Because we live in a society where there’s a dogma:  neoclassical economics, particularly the Chicago set. (By the way, I went to the Chicago school, 40 years ago. I’m not an economist but I did go there for two quarters on a fellowship.) There are lots of other economic theories out there and they get no attention because we have this dogma about economics in America.

Now that we seem to be in a moment when the discussion of inequality has gone mainstream, how optimistic are you that this is a problem we’ll actually start to fix in the near- or medium-term future?

We’re still living in the age of Reaganism; that has not come to an end yet. But we now have 33 years of empirical evidence that what Reagan promised didn’t work. If it did, if what Reagan and George W. Bush promised us worked, we would be swimming in jobs today. And we’re not.

So I’m afraid, in the short run, what we’re going to see is an effort to shift the blame for this from failed policies to us. The “it’s the 47 percent who are takers” argument that Romney put forth, rather than looking at the structure and the rules that create and reinforce inequality. But this must come to an end and we have to get some changes and what’s missing are leaders who can articulate a new path. A smarter, growth-oriented path that will make us all better off. So Elizabeth Warren, who I’ve known for 25 years, Elizabeth Warren could be that person, but I don’t think she’s going to do it. She wants to focus on fixing what she knows. But we need someone, multiple people, to arise who understands the structure and nature of the problem and can then put it in terms that ordinary people understand before we get real change.

Elias Isquith is an assistant editor at Salon, focusing on politics. Follow him on Twitter at @eliasisquith, and email him at eisquith@salon.com
.

Time to get crackin', friends.


Wednesday, May 28, 2014

Such Growing Anxiety Among the Well-Heeled That PR Game Needs Prince of Wales/Multi-Billionaire Rothschild To Make Plea for Tolerance? (Revolution Taking Reins/Heads Rolling Feared)



Let me try 'splainin' it to you, again, Ricky.

If there is no guilt felt, there is no guilt.

Clear yet?

Keep trying.

If you hear it enough (and see it acted out everywhere too much), pretty soon you'll believe it too!

And if not, they've got a lot more tricks in the works.

From our very clever friends at Wall Street on Parade.

Try to Contain Your Laughter: Prince Charles and Lady de Rothschild Team Up to Talk About ‘Inclusive Capitalism’


By Pam Martens: May 28, 2014


Lady de Rothschild Speaks on Bloomberg News About the Inclusive Capitalism Conference

Now that the worldwide Occupy Wall Street protest movement has been beaten, pepper-sprayed, mass-arrested and hog-tied into submission; now that assorted financial luminaries have exhorted corporate media to stop giving air time to people calling bankers evil; it’s now safe for the 1 percent to take over the debate – or so the thinking goes in London.
Prince Charles, who lives in four mansions in England, Scotland and Wales, delivered the opening speech yesterday for a conference on “Inclusive Capitalism” hosted by Lady de Rothschild, wife of multi-billionaire Sir Evelyn Robert de Rothschild, in the heart of financial skulduggery, the City of London, Wall Street’s alter ego.
Rounding out the day’s speakers were former President Bill Clinton, who repealed the depression era investor protection legislation known as the Glass-Steagall Act which deregulated Wall Street and is widely blamed for the 2008 financial collapse and for ushering in the greatest wealth inequality in America since the Gilded Age; and former Treasury Secretary Lawrence Summers who helped Clinton muscle through the deregulatory legislation. (You can see the full-day agenda here.)
The lurking undertone of the conference was not so much a noblesse oblige gesture to spread the wealth as it was an effort to address the growing anxiety among the well-heeled that if they don’t step up their PR game, government and/or a populist revolution is going to take the reins – and possibly their heads.
Lady de Rothschild (Lynn Forester) summed up the anxiety the day before in an interview with Bloomberg News, saying it’s “really dangerous when business is viewed as one of society’s problems.” She noted further that 61 percent of Britons say they will elect the party “that is toughest on big business.”
The web site of the Inclusive Capitalism Initiative which sponsored the conference adds this note to explain its motivations: “To avoid heavy-handed government interference in the banking sector, a revolution in management, supervision and ethics is required.”
Fiona Woolf, Lord Mayor of the City of London
The participants at the conference came from the same rarefied air as the speakers. It leaked out that the 250 corporate execs and financial bigwigs who attended the event control $30 trillion in assets. Deutsche Welle wrote: “Time will tell whether the ‘Inclusive Capitalism Initiative’ bears any fruits other than more of the sort of conferences at which extremely wealthy people arrive in private jets to spend a pleasant few hours together and reassure each other that they’re doing their best for society.”
Serving as something of a co-host for the day-long conference was Fiona Woolf, the Mayor of the City of London who goes by the 12th Century title, “Lord Mayor.” (Watching a partial web cast of the proceedings was akin to sitting through an animated children’s fairytale set in the 12th Century with repetitions of Prince, Lord and Lady tumbling off everyone’s lips.) Prior to her Lord Mayor-ship, Woolf was a partner at the 3,000 lawyer-strong law firm of CMS Cameron McKenna, which has a heavy presence in finance and banking.
Woolf sounded absolutely dazzled with anticipation when she wrote at the Huffington Post yesterday: “Today, I am hosting one of the most star-studded gatherings of recent times at the City’s Mansion House. Economic and political luminaries from across the globe are attending…” (“Star-studded” and “inclusive” do not immediately spring to mind as synonyms.)
Could it be any more fitting for the first half of the day’s events to be held in a place called “Mansion House” – a Palladian mansion whose first stone was laid in 1739 and which regularly hosts grand dinners for 250 guests on the taxpayers’ dime. The mansion serves as both residence and office for the Lord Mayor of the City of London who functions as a roving goodwill ambassador for financial interests in London.
According to the official web site, the Lord Mayor, as a “dedicated ambassador, supporting and promoting the City as the world leader in international finance and business services, the Lord Mayor travels extensively, in liaison with the Foreign and Commonwealth Office, fostering goodwill and boosting British trade, particularly the markets and services of the City.”
Christine Lagarde, Managing Director, IMF
Christine Lagarde, Managing Director of the International Monetary Fund, also addressed the conference but, apparently, hadn’t gotten the memo about not calling the bankers evil. Lagarde noted that “the most recent poll conducted by the Edelman Trust Barometer, for example, showed that less than a fifth of those surveyed believed that governments or business leaders would tell the truth on an important issue.”
Lagarde also made the following points:
“Since 1980, the richest 1 percent increased their share of income in 24 out of 26 countries for which we have data.
In the US, the share of income taken home by the top one percent more than doubled since the 1980s, returning to where it was on the eve of the Great Depression. In the UK, France, and Germany, the share of private capital in national income is now back to levels last seen almost a century ago.
“The 85 richest people in the world, who could fit into a single London double-decker, control as much wealth as the poorest half of the global population  – that is 3.5 billion people.”
Mark Carney, Head of the Bank of England, Speaking on Inclusive Capitalism
The final speaker of the evening was the head of the Bank of England, Mark Carney, who brought up those pesky issues of rigged markets (which in effect are part of an institutionalized wealth transfer system). Carney said: “In recent years, a host of scandals in fixed income, currency and commodity markets have been exposed. Merely prosecuting the guilty to the full extent of the law will not be sufficient to address the issues raised. Authorities and market participants must also act to re-create fair and effective markets.”
Prosecuting the guilty to the full extent of the law? That’s a very novel idea on this side of the pond.

My guess is that those at the bottom of the wealth pyramid are going to get their bonuses slashed because somebody's gotta pay for the crime of the last two centuries.

Again.

(And just how large a jewel is tasteful to wear with a simple silk blouse and jacket for work?)


Don't Eat Chicken! (Piketty Picks Them Apart)



Or eat it at your peril.

I haven't eaten chicken regularly (unless I'm a guest where only it is served) in two decades - mirroring, as a matter of fact, the rise of Tyson Foods (remember how they so lavishly funded home-boy Willy as well as everyone else who would accept their filthy lucre?) and the overwhelming takeover of family farms by heavy-industry meat production.

As if it could get any worse.

The USDA’s assurances notwithstanding, many critics would like to know how, exactly, the new system is supposed to make our poultry supply safer, given two of its most notable features: a 25 percent increase in the speed of processing lines, coupled with a 40 percent decrease in the presence of government inspectors in our nation’s poultry plants. That’s a highly risky combination, says Christopher Leonard, whose recently published book, The Meat Racket, explores the rise of Tyson Foods and the evolution of the American poultry industry.

Last February, an investigation by Consumer Reports magazine found that 97 percent of all chicken breasts sold in American supermarkets harbored illness-causing bacteria, including E. coli and salmonella. Reshaping our poultry regulations along HIMP guidelines, Leonard says, would “clearly make the system less safe than it already is. The safety inspection regime is already strained to the point of breaking.”
It’s even harder to make the case that HIMP won’t affect the health of poultry workers, who, according to the U.S. Occupational Safety and Health Administration (OSHA), already report an injury rate that’s more than 50 percent higher than the injury rate for all U.S. workers. A recent study by the National Institute for Occupational Safety and Health (NIOSH) found that 42 percent of workers at one South Carolina plant showed evidence of carpal tunnel syndrome, attributable to the constant repetition of specific hand and wrist motions at certain speeds.

“Line speed affects the periodicity of repetitive and forceful movements, which are the key causes of musculoskeletal disorders,” wrote NIOSH director John Howard after the study had been completed. Ramp up line speed, and it seems inevitable that carpal tunnel — and line backups, like the ones Clements saw spilling meat onto the floor — will go up, too.
But for all the debate over HIMP’s potential impacts on consumer and worker safety, there’s no debating the reason the poultry industry would like to see the new system put in place: money. In America’s poultry plants, says former USDA inspector Alvin Sewell, “production rates are everything.”

Should HIMP rules become standardized across the nation, the maximum allowable speed of processing lines will rise from 140 to 175 birds per minute, translating into an extra $256 million a year for the industry. But poultry companies won’t be the only ones realizing a windfall from changing over to HIMP: by decreasing the presence of government inspectors on processing lines, the USDA estimates that it will cut its own personnel costs by as much as $90 million in the first three years after implementation.
And critics point out that while government inspection would go down under the revisions, poultry plants are being given permission to expand their use of powerful chemicals to kill off dangerous bacteria during processing. Under current law, poultry plants must formally request authorization from the USDA in order to subject their carcasses to antimicrobial baths, using powerful chemicals like chlorine and peracetic acid.

But under HIMP regulations, the USDA would simply issue a blanket pre-authorization to any and all poultry companies who decide to engage in the practice.

The land of the intentionally deaf (but hardly dumb) has weighed in with its concern trolling outdated worries (for the poor, poor rich). Piketty picks them apart.

Funny, isn't it, how the interests, who might lose a little bit of their staggering lately-acquired wealth to very slightly higher taxes (ask Warren Buffet, who favors them), are so highly in an uproar that they feel the need to bring in the lightweights like now thoroughly exposed (naked in fact) charlatan and expert on nothing but his own love life, David Brooks of the New York Times editorial staff, to seriously question the economics history as if he is well-versed enough on the relevant literature to ask anything more than puffball questions?

It's not a difficult read, but it helps if you want to understand its terms and implications.

“The entrepreneur inevitably tends to become a rentier, more and more dominant over those who own nothing but their labor,” economist Thomas Piketty writes in his explosive and unexpected best-seller “Capital in the Twenty-First Century.” “Once constituted, capital reproduces itself faster than output increases. The past devours the future.”

That warning – and Piketty’s signature inequality “r > g” – have drawn a volume of attention, admiration and scorn unmatched by any other recent economics volume. So we called up Piketty to react to the reaction.

“The idea that progressive taxation is politically infeasible is just wrong…” Piketty told Salon in a Monday interview. “I am not impressed by that kind of claim, because the same people one century ago would have said that the progressive income tax will never happen in the U.S. or elsewhere.”

Reached by phone in Paris, the newly famous professor pushed back against his critics on the left and right; considered how much education or migration can mitigate inequality; and defended his book’s signature policy proposal: an unprecedented global progressive wealth tax.

“I’m very sad if the book made some people depressed,” Piketty told Salon. “But I am not depressed.”
David Brooks… writes that “Piketty predicts that growth will be low for a century, though there seems to be a lot of innovation around. He predicts that the return on capital will be high, though there could be diminishing returns as the supply increases. He predicts that family fortunes will concentrate, though big ones in the past have tended to dissipate and families like the Gateses give a lot away. Human beings are generally treated in aggregate terms, without much discussion of individual choice.” What do you make of those critiques from David Brooks?
I do my best to respond to them in the book. As a general response, let me say that I don’t know what the future value of the growth rate and the rate of return will be.

It could be that we manage to get a lot higher growth that we’ve had in the past. It could be that we are all going to have so many children, and we are all going to be making so many new inventions, that the growth rate will be 4 or 5 percent, and will be as large as the rate of return. Or it could be that we don’t know what to do with capital anymore, and the rate of return will fall to the growth rate. You know, this could happen. But it would really be an incredible coincidence.

So in case this incredible coincidence happens, we will be fine. We will not need my other solution. And I will be very happy. All I am saying is that we should not bet on that. And we should make another plan, in case this incredible coincidence does not happen…

There is a lot of evidence suggesting that even if we try to promote innovation as much as we can, and even if we try to increase growth rate as much as we can – and I am certainly in favor of any policy going in this direction – that even if we do that, that’s not going to bring us to a 4 or 5 percent growth rate. We are still going to be somewhere between 1 and 2 percent, at least for productivity growth. And it’s not so easy to impact on population growth…

Maybe the total growth rate will not be 4 or 5 percent in the long run. Maybe it will be only 1 to 2 percent. I guess my main point in the book is that we should organize ourselves so as to be able to react to whatever happens.
So right now, what we see is that the top of the wealth distribution is rising at 6, 7 percent a year — more than three times faster than the size of the economy
. How far is this going to go? Is this going to stop somewhere? Yes, of course it will stop somewhere. But where exactly will it stop? I think nobody knows…

We should not just be waiting for natural forces to get us to the right place… There is no natural force that makes the rate of return and the growth rate of the economy coincide in the long run. And there is no natural force that prevents the concentration of wealth from rising to a high level. So I am not saying this will rise forever. This will stop somewhere. I am just saying that this somewhere can be very high, and there is no natural force that prevents this from happening.

So instead of just waiting and seeing, I am just saying we should have more transparency on wealth — more financial transparency, more democratic transparency on wealth dynamics — and then we will adjust the tax rate to whatever we observe…

If what we observe is that the top of the wealth distribution is not rising more than the average… we don’t need to have a sharply progressive tax rate at the top. But if the top of the wealth distribution is rising at 6, 7 percent a year, then don’t tell me that a 1 or 2 percent tax rate on top wealth will kill the economy. So we have to be very pragmatic on this. And most importantly, we need to have democratic and fiscal institutions that are able to produce the kind of information, and the kind of transparency, that will allow us to adapt to whatever we observe…

I don’t pretend that I can predict the future value of the growth rate or rate of return. I’m just looking at the data. And if the data changes in the future, and the top stops rising three times faster than the average, then I will be very happy to look at the data and to say it.

I don’t have any stake in this.

Now that you are a celebrity, would you consider running for office?

Oh no, not at all. That’s not part of my plan now.

On the question of global inequality: The new Purchasing Power Parities report from the World Bank’s International Comparison Program, while noting the result should be “interpreted with caution” due to methodological changes, finds that “The spread of per capita actual individual consumption as a percentage of that of the United States has been greatly reduced, suggesting that the world has become more equal.”…First, are you convinced by that result? And second, how do you see the relationship between global inequality and inequality within individual countries?

There has been a great reduction in global inequality over the past few decades — that’s for sure… That’s convergence between emerging countries and rich countries… a diffusion of technical knowledge and skills and operational knowledge — and that’s the most powerful force pushing in the direction of reducing inequality. So in principle, this could also work within [a] country, this same process of diffusion of knowledge and skill, but this requires a very inclusive educational institution, so that people with less skills can catch up…

What’s quite striking is that in spite of this convergence at the global level in terms of per capita GDP, the top of the distribution of wealth at the global level has been rising a lot larger than per capita income or output or wealth at the global level. This convergence — although they are very strong, they have been less strong than this “r bigger than g” at the global level…

[The book considers] the growth rate at the top of the global distribution of wealth… The top has been rising three times as large as the average. Which was not obvious to me before I did this computation. Because you could have that thought that the convergence force in terms of per capita GDP would dominate the “r bigger than g” effect.

The economist Suresh Naidu suggests… “if we’re aiming for politically hopeless ideas, open migration is at least as good as the global wealth tax in the short run, and perhaps complementary.” Does he have a point?
These are complementary positions. These are not substitutes. Yeah, I am in favor of migration. But I am also in favor of education. But at the same time I am in favor of progressive taxation. I think we need all of this. I think we don’t have to choose one.

The idea that progressive taxation is politically infeasible is just wrong… I am not impressed by that kind of claim, because the same people one century ago would have said that the progressive income tax will never happen in the U.S. or elsewhere

Sometimes things happen even when we don’t expect them to happen.

Sunday, May 25, 2014

Culture of Secrecy Emanates From or To United States? (‘A Government Of Thugs’ Covering Up What's Going On in the Boondocks) Science Not On the Move?



I guess it's just an oversight by the powers-that-be that the tar, er, oil sands will come wending their way through the U.S. proper after the wholesale adoption of the Keystone XL Pipeline.

Gee, if we could only trust them that it's just the money they're after (and not the environmental disaster).

Lots of moolah still to be made in cleaning up that foofah!

Thus far, government push-back against environmental journalism seems to be working. As a recent survey of Canadian journalists showed, many environmental and climate stories about the tar sands often go unreported. That survey, titled “The Alberta Oil Sands, Journalists, and Their Sources,” questioned 20 reporters with extensive daily experience reporting on the tar sands.

Of the 20, 14 said stories about the tar sands were not being told, and seven of those 14 said environmental issues were the main ones untouched.
Environmental damage done by leaking tailings ponds and bitumen waste; toxic contaminants leeching into the water; the impact of excess sulfur produced in the mining process — all of those were included in the issues journalists perceive as under-reported.

Whoever the controlling group is of these momentous (civilization-destroying) decisions, it has become clear that they are taking no chances with being stopped from their appointed devastating rounds.

I think we are gaining a better understanding daily of why the first groups targeted after 9/11 were the political and environmental groups opposed to the plans of the neoliberals (the only real terrorists).

Take heed, friends.

There are logical reasons why impeding environmental journalists could be in Canada’s interest. The tar sands are the third largest oil reserve in the world, and production is currently accelerating so quickly that the government predicts capital investments will reach $218 billion over the next 25 years. Part of that investment could come from the Keystone XL pipeline, the controversial proposal that, if approved, would bring up to 830,000 barrels of Canadian crude oil per day down to refineries in the U.S. 

So it makes sense that Canadian officials may want to prevent environmental perspectives on Fort McMurray’s vast tar sands reserves, which have replaced thousands of acres of boreal forest with massive refineries and sprawling mining sites — shiny, black excavated deserts that sit next to glowing white ponds of chemical waste. A small portion of boreal forest remains, but it doesn’t do much to cover the scars. 

An aerial view of tar sands mining in Fort McMurray. An aerial view of tar sands mining in Fort McMurray. CREDIT: NextGen Climate Action

From the air, you can see enormous white smokestacks 50 miles away. And from the ground, you can talk to those who have been physically harmed by accidental releases from the white ponds of tar sands chemical waste, called tailings ponds, which leech into the Athabasca river and flow downstream to First Nations communities like Fort Chip, where cancer rates have skyrocketed in the last 30 years.

Stories that describe the detrimental effects of Canada’s fossil fuel boom — not to mention the high carbon-intensity of tar sands oil extraction or unlikelihood that mining sites will ever be adequately reclaimed — threaten public support for projects like Keystone XL, and by extension, speedy and lucrative development.

‘A Culture Of Secrecy’


According to Tom Henheffer, executive director of the non-profit Canadian Journalists for Free Expression (CJFE), the Canadian federal government has been actively working for the last decade to prevent journalists’ access to information, particularly in science-related fields. The trend only got worse, he said, when current Prime Minister Stephen Harper, a fierce supporter of tar sands development, took office in 2006. 

“It’s specifically very bad in science-related fields, but it extends into every other field,” Henheffer said. “This government has a culture of secrecy that is extremely harmful to Canadian society.”

Henheffer, whose group in April released its annual Review of Free Expression in Canada Report Card, noted two main issues at play. One, he said, is an increase in the amount of bureaucracy journalists must go through to get information. The other is a gradual de-funding of research, so the information journalists want isn’t even created in the first place.

The CJFE’s report card gave a failing grade to Canada’s access-to-information (ATI) system, which saw delays beyond the legal time limit affecting almost 45 percent of information requests, and more than 80 percent of responses partially or mostly censored. That report card also slammed the government for cutting scientific research, dismissing more than 2,000 scientists and cutting 165 research programs affecting “almost every federal scientific and monitoring institution.”

The report also noted a nationwide “muzzling” of federal scientists, citing government efforts to ensure its scientists limit discussions with the media on their work — much of which includes the environmental and climate impacts of tar sands development. This was confirmed in 2007, when a leaked PowerPoint presentation from Environment Canada revealed that government scientists were told to refer all media queries to communications officers who would help them respond with “approved lines.”

The current climate, Henheffer said, is frustrating journalistic efforts throughout the country. 

“They’ve essentially dismantled our access to information system,” he said. “It makes investigative journalism impossible.”

The ‘Extremist Threat’ Of Environmentalists


Along with access to information for journalists, Stephen Harper’s government has also been working to dismantle environmental groups, a fact that has been revealed, ironically, by document requests from journalists. Those documents show unprecedented attempts from agencies across the federal government to spy on, de-fund, and otherwise disrupt the efforts of environmental groups.

The most recent example of this has been a rigorous effort by the Canada Revenue Agency to target environmental groups for possible abuse of their nonprofit charity statuses, alleging they may be violating the limits on how much political advocacy work they can do. The CRA’s $8 million effort was launched in 2012, shortly after the pro-tar sands group Ethical Oil kicked off a public campaign to “expose the radical foreign funded environmental groups” criticizing the oil industry.

“There are environmental and other radical groups that would seek to block this opportunity to diversify our trade,” Joe Oliver, then-Natural Resources Minister, wrote at the time. “These groups threaten to hijack our regulatory system to achieve their radical ideological agenda. They seek to exploit any loophole they can find, stacking public hearings with bodies to ensure that delays kill good projects.”

One of the original groups targeted was ForestEthics, a British Columbia-based nonprofit with branches in Vancouver and San Francisco. One of the fiercest and more outspoken opponents of the tar sands and the proposed Northern Gateway pipeline, the group responded by giving up its charitable status (thereby giving up tax breaks to its donors) so it could focus more on combating what it refers to as “attacks on the environment.”

Ever since we formed the advocacy group we’ve been under further … ‘intense scrutiny’ I guess is the nicest way to put it, because the advocacy group is set up explicitly for the sake of taking on the Harper government,” ForestEthics tar sands campaigner Ben West said.

West said that since his group founded its advocacy arm, it has been a target of a recently-revealed spying effort by the Canadian federal government


That effort, revealed in November by a public records request from the Vancouver Observer, showed that officials had been sending spies to meetings of anti-tar sands groups, relaying their plans for rallies and strategies for public meetings. 

What’s more, documents obtained in February by the Guardian revealed that both Canada’s national police force and intelligence agency view environmental activist protest activities as “forms of attack,” and depict those involved as national security threats. Greenpeace, for example, is officially regarded as an “extremist” threat.

A tar sands refinery in Fort McMurray.A tar sands refinery in Fort McMurray. CREDIT: Emily Atkin

West said the revelations have had a “chilling” effect on the groups’ volunteer and donor base.

“The word is out that ForestEthics is one of the groups that the federal government is paying close attention to, and that has an impact on people’s comfort levels and their desire to get involved,” West said. “If you look at the pieces of the documents we were able to get our hands on, they explain what was happening at meetings where you would have had to have been in the room to have known the content of that meeting.”


‘A Government Of Thugs’


In addition to the more-calculated attempts to prevent environmental criticism, multiple reporters and activists say they experience an egregious amount of defensiveness, spitefulness, and intimidation from the federal government that prevents them from doing their jobs effectively.

“We have a government of thugs in Ottawa these days who are absolutely ruthless,” said Andrew Nikiforuk, an award-winning journalist who has been reporting critically on Canada’s oil and gas industry for more than 20 years. “It’s a hostility and thuggery, is the way I would describe it. That’s exactly what it is.”

Nikiforuk says he’s been shut out of government events, “slandered and libeled” by a member of the government’s conservative party, and repeatedly contacted by government flacks who criticize his reporting. 

The most blatant example of government intimidation Nikiforuk can recall was when members of Canada’s Energy Resources Conservation Board actively tried to prevent the publication of his 2010 book, Tar Sands, claiming he made numerous factual errors and posting a long letter about it on its website.
Nikifourk rebutted the claims, eventually winning the Society of Environmental Journalist’s Rachel Carson Book Award for his reporting. 

Documentary and satire filmmakers Andy Cobb and Mike Damanskis also said they experienced government intimidation when, like me, they were detained at the Fort McMurray airport in October 2013. Unlike me, however, they were deported.

He basically told us that the tar sands weren’t news, that he wasn’t recognizing us as journalists, and that if we wanted to come to Canada, we weren’t going to be able to do it today,” Damanskis said. 

Though it seemed like at first they would be able to enter the country without working papers, Damanskis and Cobb said the border official had an “immediate change of heart” after watching a clip of their previous work — a video satirizing the infamous Mayflower, Arkansas tar sands pipeline spill.

Border spokesperson Lisa White said she was not authorized to speak on specific cases, and declined to specify whether officers were allowed to make entry decisions based on the content of journalists’ work. She did say, however, that documentary filmmakers required working papers to enter Canada, and that all entry decisions are made on a case-by-case basis.

“All decisions are made in accordance with Canadian law,” she said.

Swift And Snarky Push-Back


Of course, it’s important to note that journalists like Nikiforuk, Damaskis, and Cobb are more likely to get negative feedback from Canadian government officials because they are not, and don’t claim to be, completely objective. All three are openly and fiercely opposed to the speed of tar sands development.

But even reporters who are seemingly more objective toward development have been subject to government push-back. For example, Economist correspondent Madelaine Drohan said via e-mail that Alberta’s provincial government once posted a “defensive” response on its website to an article she wrote that mentioned leaks from tailings ponds, which are large lakes of tar sands waste. That response has since been removed, but Drohan said she remembers it happening.

It made me think that the government was even more sensitive than the industry,” she said.

As for hostility from the Alberta provincial government, one journalist pointed specifically to David Sands, a director at Alberta’s Public Affairs Bureau, whose Twitter account is made up largely of rebuttals to journalism critical of Alberta government

In recent tweets, Sands compared two newspapers’ coverage of Parliament to “jihad,” among other critical responses.

“Yeah, I’m the mean guy,” Sands told ThinkProgress. “It’s definitely my personal style, but nobody told me to be mean.”

Sands said part of his job is tracking down stories that include inaccuracies about Alberta government policies. He said he’s the only one in his department with the specific mandate to do so. 

Waste ponds at a tar sands mining site in Fort McMurray.

Waste ponds at a tar sands mining site in Fort McMurray. CREDIT: NextGen Climate Action

Still, many have criticized Alberta for the number of people they’ve employed to hunt down stories. According to documents obtained by the Canadian Taxpayers’ Federation in April, Alberta employs 214 communications professionals at a cost of $21 million per year, a number that the National Post notedfar outstrips” the number of reporters who cover government

Sands rebutted that story too, saying communications staff span a range of departments — healthcare, education, law enforcement — that are not all dedicated to attacking journalists.

“It’s sort of an enjoyment of the media to say we have 214 communications people who are all dealing with the media,” he said. “When reporting is challenged, people take it very personally.”

The Strategy Is Working — Or Is It?


Thus far, government push-back against environmental journalism seems to be working. As a recent survey of Canadian journalists showed, many environmental and climate stories about the tar sands often go unreported. That survey, titled “The Alberta Oil Sands, Journalists, and Their Sources,” questioned 20 reporters with extensive daily experience reporting on the tar sands.

Of the 20, 14 said stories about the tar sands were not being told, and seven of those 14 said environmental issues were the main ones untouched.

Environmental damage done by leaking tailings ponds and bitumen waste; toxic contaminants leeching into the water; the impact of excess sulfur produced in the mining process — all of those were included in the issues journalists perceive as under-reported.

“I hate this story,” one reporter who participated in the study said. “It’s important, but there’s no direction or progression.”
As for activist groups, Ben West of ForestEthics said the hostility has actually been helping his group’s efforts. And it’s not just the group itself. As the government’s attacks have become more and more public, West says his and other environmental advocacy groups have been obtaining record-breaking donations from individuals — what he calls a “clear sign” that Canadians want to protect their environment from the tar sands.
I actually kind of welcome these attacks from the federal government in a sense, because they are a great opportunity to highlight how crazy our government’s acting, and use it as a reason to ask people for more support,” he said.

“Many Canadians feel strongly about this. Let the government create their own disincentives.”

Charlie Pierce at Esquire has a few observations worth considering by people still open to logic (who aren't also being paid off by the pipeline owners).

Three million gallons of contaminated water is estimated to be leaking from these ponds into nearby rivers and environment every day. (photo: Rethink Alberta)

Three million gallons of contaminated water is estimated to be leaking from these ponds into nearby rivers and environment every day. (photo: Rethink Alberta)
go to original article

The Secrecy Surrounding Canada's Tar Sands


By Charles Pierce, Esquire

24 May 14
he folks at Think Progress have a profoundly terrifying report from the blasted environmental moonscape of northern Alberta, whence the world's dirtiest fossil fuel may one day flow down our old friend, the Keystone XL pipeline, the continent-spanning death funnel that will run from said moonscape, through the heart of some of the world's most precious farmland, and eventually to the refineries of Texas, and thence to the world. (Two uses of "whence" in one sentence? I'll have the resume off to the BBC by Monday.)
It seems that the tar-sands operation now pretty much involves a serious portion of the Canadian government, and it would rather the world not know what's going on in the boondocks.

According to Tom Henheffer, executive director of the non-profit Canadian Journalists for Free Expression (CJFE), the Canadian federal government has been actively working for the last decade to prevent journalists' access to information, particularly in science-related fields. The trend only got worse, he said, when current Prime Minister Stephen Harper, a fierce supporter of tar sands development, took office in 2006. "It's specifically very bad in science-related fields, but it extends into every other field," Henheffer said. "This government has a culture of secrecy that is extremely harmful to Canadian society."
The umbrella of this secrecy apparently is being used, not to protect Canadian citizens, but to shield corporate profits. And secrecy is not the only weapon of the government that has been brought to bear.

What's more, documents obtained in February by the Guardian revealed that both Canada's national police force and intelligence agency view environmental activist protest activities as "forms of attack," and depict those involved as national security threats. 
Greenpeace, for example, is officially regarded as an "extremist" threat.
(And if you're wondering if it can happen here, remember that the all-too-human, but curiously error-prone, heroes of our intelligence community already are doing some subcontracting work for American corporations. Yell "terrorist" and half the government goes on point. I don't like the civil-liberties chances of anyone opposing this pipeline in the United States if it gets approved and once the construction begins.)
This whole project has been ethically hinky from jump. The case for the pipeline was built on lies and exaggeration. (Don't forget to count the strippers! Jobs!) TransCanada, the Canadian corporation that wants to build it, has been dealing double with farmers all along the proposed route, most notably in Nebraska and in Texas.
The company already has bent too many local and state governments to its will. This is a profoundly corrupt enterprise, which is why it is cloaked with the kind of secrecy in Canada that inevitably will come to be the norm here. That's reason enough to reject it.

Friday, May 23, 2014

The Rich Are So Afraid of Piketty's Book That They're Sounding the Alarm About their Fear of a New American Revolution Against Them (The HORROR!)



People in America are under attack daily. The greedy rich know it, because they are the ones doing the attacking. They know that they have made collateral damage out of hungry children, hard-working parents, grandmother and grandfathers. And somewhere behind the gates of their private communities and the roped-off areas — their private schools, private hospitals, private modes of transport — they fear that the aggression may one day be turned back. They wonder how far they can erode our quality of life before something might just snap.

The rich are terrified of the poor.

The newly poor, made poor by the rich, are not even after the rich.

But the rich are being threatened with a .0001% tax on their newfound wealth by the poor.

So, they are being terrified by the poor.

And it's all so mean.

After all, they "stole it fair and square."*


The goal of this vicious war is to control all of the wealth and the government not just in the U.S., but the rest of the world, too, and to make sure the people are kept in a state of fear.

. . . the greedy rich are experts in cloaking their aggression. Like steel tycoon Andrew Carnegie, who successfully transitioned from robber baron to philanthropist, David H. Koch and his conservative colleagues put on the mask of philanthropy to hide their war dance. Or they project their aggression onto ordinary people who are simply trying to feed their families, pay the bills, and keep the roof over their heads. Many of the wealthy liberals play a less crass version of the game: they talk about inequality only to alleviate their conscience while secretly — or not so secretly — protecting their turf (witness: NY Governor Andrew Cuomo and his mission to reduce taxes on his wealthy benefactors).

It is rich Americans, in particular, financial capitalists, who have made the war-like values of self interest and ruthlessness their code of ethics through their championing of an unregulated market. When we hear the term, “It’s just business,” we know what it means. Somebody has legally gouged us.
 *Jesse Helms

Who knew Jesse Helms would turn out to be the leading radical philosopher of the 21st century?

(There's a very revealing new documentary just released on the life of Gore Vidal that my readers may be interested in viewing entitled "Gore Vidal:  The United States of Amnesia." Also, friends may make a contribution to the continuation of this blog at the Pay Pal button at the top left of this page or by contacting me at the email linked to this blog.)

Friday, May 23, 2014

Piketty Paranoia:  Why Conservatives Are Suddenly Terrified of Revolution

The signs are there. As wealth becomes more concentrated, American society is growing increasingly antagonistic

Lynn Stuart Parramore, AlterNet

Piketty paranoia: Why conservatives are suddenly terrified of revolution

Thomas Piketty (Credit: Reuters/Charles Platiau)

On the June cover of the conservative magazine American Spectator, a vision arises from the collective unconscious of the rich. Angry citizens look on as a monocled fatcat is led to a blood-soaked guillotine, calling up the memory of the Reign of Terror during the French Revolution, when tens of thousands were executed, many by what came to be known as the “National Razor.” The caption reads, “The New Class Warfare:  Thomas Piketty’s intellectual cover for confiscation.” One member of the mob can be seen holding up a bloody copy of the French economist’s recent book, Capital in the 21st Century.

Confiscation, of course, can only mean one thing. Off with their heads! In reality, the most “revolutionary” thing Professor Piketty calls for in his best-selling tome is a wealth tax, but our rich are very sensitive.

In his article, however, James Pierson warns that a revolution is afoot, and that the 99 percent is going to try to punish the rich. The ungrateful horde is angry, he says, when they really should be celebrating their marvelous good fortune and thanking their betters:

“From one point of view, the contemporary era has been a ‘gilded age’ of regression and reaction due to rising inequality and increasing concentrations of wealth. But from another it can be seen as a ‘golden age’ of capitalism marked by fabulous innovations, globalizing markets, the absence of major wars, rising living standards, low inflation and interest rates, and a thirty-year bull market in stocks, bonds, and real estate.”
Yes, things do indeed look very different to the haves and the have-nots. But some of the haves are willing to say what’s actually going down — and it’s a war of their own making. Warren Buffett made this very clear in his declaration:  “There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning.”

Warren is quite correct:  It is the rich who have made war against the 99 percent, not the other way around. They have dumped the tax burden onto the rest of us. They have shredded our social safety net and attacked our retirements. In their insatiable greed, they refuse even to consider raising the minimum wage for people who toil all day and can’t earn enough to feed their children. And they do everything in their power to block as many people from the polls as possible who might protest these conditions, while crushing the unions and any other countervailing forces that could fight to improve them.

The goal of this vicious war is to control all of the wealth and the government not just in the U.S., but the rest of the world, too, and to make sure the people are kept in a state of fear.

But the greedy rich are experts in cloaking their aggression. Like steel tycoon Andrew Carnegie, who successfully transitioned from robber baron to philanthropist, David H. Koch and his conservative colleagues put on the mask of philanthropy to hide their war dance. Or they project their aggression onto ordinary people who are simply trying to feed their families, pay the bills, and keep the roof over their heads. Many of the wealthy liberals play a less crass version of the game:  they talk about inequality only to alleviate their conscience while secretly — or not so secretly — protecting their turf (witness:  NY Governor Andrew Cuomo and his mission to reduce taxes on his wealthy benefactors).

It is rich Americans, in particular, financial capitalists, who have made the war-like values of self interest and ruthlessness their code of ethics through their championing of an unregulated market. When we hear the term, “It’s just business,” we know what it means. Somebody has legally gouged us.

People in America are under attack daily. The greedy rich know it, because they are the ones doing the attacking. They know that they have made collateral damage out of hungry children, hard-working parents, grandmother and grandfathers. And somewhere behind the gates of their private communities and the roped-off areas — their private schools, private hospitals, private modes of transport—they fear that the aggression may one day be turned back. They wonder how far they can erode our quality of life before something might just snap.

The growing concentration of wealth is creating an increasingly antagonistic society, which is why we have seen the buildup of the police state and the rise of unregulated markets appear in tandem. This is why the prisons are bursting at the seams with the poor.

The oligarchs hope that Americans will be so tired, so pumped full of Xanax, so terrified, that they will remain in their places. They hope that we will watch the rich cavorting on reality shows and set ourselves to climbing the economic ladder instead of seeing that the rungs have been kicked away.

Of course, there is a very easy way for the rich to remain rich and alleviate their nightmares of the guillotine. That is simply to allow their unearned wealth to be taxed at a reasonable rate. Voila!No more fear of angry mobs.

Or they can wait for some less pleasant alternative, like a revolution. This theme, which once timidly hid behind the scenes, has lately burst onto cultural center stage. The cover of the current issue of Lapham’s Quarterly, dedicated to the topic, “Revolutions,” features five crossed swords. Its contents outline various periods in history when ordinary folks had had enough, such as “The People’s Patience is Not Endless,” a pamphlet issued by the Command of Umkhonto we Sizwe, the armed wing of the African National Congress, in December 1961.

Very interesting reading for the 1 percent.


Thursday, May 22, 2014

We Can't Get Piketty? (They Wish) We Do Get the Geithner Buy-My-Book Glibberties



Did you catch Tim Geithner's comedy act last night on Stephen Colbert? (Sorry that there's no link yet to be posted - I'll post it when it becomes available later.)

It was quite a triumph. Colbert was speechless at the end.

You'd have been too if you'd bought any of Geithner's glibness with what seemed to be either Colbert's star struckness (or dumbstruckness).

When I was in graduate school in the early 80's I wrote almost all of my papers on how the changes lobbied for (and eventually won most of) in tax and investment policy by the Reagan Revolutionists were bringing a revolution against the interests of those usually in the revolutionary roles.

My professors said almost uniformly that I was brave. (I've got comments in writing at the top of some of my papers if you need to see proof.)

I had no idea at the time how brave it must have seemed to economists at that time to say what seems obvious today then.

There's a lot of this same type of analysis in John Feffer's latest essay.

Wish I'd said it recently.

In a book, with statistics like his, that sold so well.


Piketty in Elysium


If inequality sells in bookstores and box offices, it will sell at the polls as well.

By John Feffer


May 21, 2014

thomas-piketty-inequality-elysium

A ship descends on the fictional space station of Elysium in last summer’s box office hit. Concerns about economic inequality are driving summer blockbusters and New York Times best sellers. When will they start driving our politics?

At the beginning of last summer’s blockbuster film Elysium, three rogue shuttles from Earth approach a space station that houses a super-rich enclave. It’s the ultimate offshore gated community, where the inhabitants possess magical machines that rid them of disease so that they can practically live forever. The shuttles, meanwhile, contain the poor, the sick, “the wretched refuse of your teeming shore.” In this science-fiction scenario, the Earth has been become little more than a third-world outpost of hovels, prisons, and unregulated factories.

Two of the shuttles containing illegal border-crossers are immediately shot down. One of them, however, manages to land on Elysium. A mother and her disabled child break into a sparkling clean house and locate the magic machine. The child lies on the flat surface, the machine hums, and her handicap disappears. It’s a short-lived triumph as armed guards seize the intruders and repair the security breach.

The future, as Hollywood imagines it, rarely looks good. We’ve either bombed ourselves back into barbarism (Mad Max, The Road), trashed the environment, (Soylent Green, Wall-E), or somehow eliminated our ability to procreate (The Children of Men). In Total Recall, the horrors of unregulated capitalism have been outsourced to Mars where an autocrat runs a mining operation designed by Hieronymus Bosch.

If in the past we imagined a future of distant penal colonies for the criminal 1 percent, we now are projecting a penal earth for the outcast 99 percent. Elysium is almost a parody of this 99-to-1 dichotomy, for the space station is home to only a tiny handful of people while Earth looks like the crack-ravaged South Bronx of the 1980s. In this scenario, the wolves of Wall Street have siphoned up as much wealth as they can before departing, not for some exclusive Caribbean island — rising waters have presumably eliminated those tax havens — but for the insulated comforts of outer space.

Hollywood projects our dreams and fears. In the past our cinematic apocalypses have reflected our obsessions with nuclear holocaust and environmental degradation. We’re certainly still worried about those fates — along with pandemics and zombies — but gross inequality now competes for our attention. The Occupy movement no longer squats in our squares. The indignados have faded into the European woodwork. But the analysis and demands of the 99 percent have managed to trickle up.

Consider the new book by Thomas Piketty, the French economist. In his analysis of tax records in France, the United Kingdom, and the United States, Piketty shows how capitalists have run away with capitalism and left the workers behind. In more formal terms, when the rate of return on capital outstrips the growth rate of the economy, inequality rises.

Moreover, Piketty shows how public policy has had a profound impact on wealth and poverty in society. The trends associated with the rise of finance capitalism and the spread of globalization have certainly encouraged the consolidation of a class of super-rich and the erosion of wages for the middle and working classes. But certain governments — France, Germany, Japan — have used tax and welfare policies to redistribute the wealth without any appreciable impact on growth.

Not that I’ve read Capital in the Twenty-First Century. Piketty’s book has become virtually impossible to obtain. I recently walked into the country’s largest independent bookstore — Powell’s in Portland — and asked for the bestseller. The clerk explained that every copy had been eagerly snatched up, and I should come back in a couple weeks.

What explains Piketty’s extraordinary success? His book is certainly not the first study of economic inequality. My colleagues at the Institute for Policy Studies have been hammering at this issue for more than a decade. Chuck Collins published 99 to 1: How Wealth Inequality is Wrecking the World and What We Can Do About It a couple years ago. 

The most recent version of our CEO pay report, which has documented the outrageous compensation packages for our titans of finance and business, focuses on the growing divide in the restaurant industry between the richly compensated (Howard Schultz of Starbucks) and the barely hanging on (the toilers in the fields of fast food).

CEO Howard Schultz pocketed $236 million in exercised stock options and other ‘performance pay’ over the 2012-2013 period,” the report explains. “That translates into an $82 million taxpayer subsidy for Starbucks — enough to raise the pay for 30,507 baristas to $10.10 per hour for a year of full-time work.”


And even before Piketty became a surprise bestseller, we were awash in statistical evidence. “In the United States, according to the economist Emanuel Saez of the University of California, Berkeley, the richest 10 percent increased their share of total pretax income from about 33 percent in the late 1970s to 50 percent by 2012,” Paul Starr writes in The New York Review of Books. “The top one percent alone now capture more than 20 percent of total income, double the share they received before the Reagan years.”

Piketty, however, provides the kind of continental, academic imprimatur that mere number crunchers in the United States lack. His use of an extensive data set appeals to the empirically minded, his prescriptions satisfy the policy-minded, and his references to Austen and Balzac impress Paul Krugman.

And he offers the long view, situating today’s inequality in the much larger historical context of oscillations in income distribution. Finally, his book has put the Heritage Foundation and the American Enterprise Institute on the defensive, as they dust off their usual arguments about the dangers of taxation.


But perhaps the most important reason for Piketty’s success here in the United States is a latent outrage at the deal that the Obama administration made down at the crossroads at midnight in the wake of the financial crisis. As we all know, the U.S. economy did not collapse in 2009, though it came close. Many people continue to suffer from the financial follies of the 2000s, their homes foreclosed on, their jobs gone, their pension funds looted

But the Obama administration can point to larger, statistical successes: much lower unemployment rates (6.3 percent today compared to 10 percent in October 2009) and some modest growth (close to 3 percent last year). More critically, for all the high rollers on Wall Street who supported Obama’s campaign, the stock market has gone steadily upwards, with the Dow Jones now cresting above 16,000 (a 94-percent increase over the last five years).

The deal with the Devil, however, was an ugly one. Only one person is going to jail as a result of the widespread malfeasance connected to the financial crisis — Kareem Serageldin of Credit Suisse.

His story reads like one of those cautionary Mafia narratives in which one of the mobsters takes the rap for the entire gang, keeps his mouth shut, does his time, and returns for his payout when his time is up.


For despite a very brief period of self-imposed austerity at the depths of the crisis, the financial world has continued to enjoy extraordinary success. Just take a look at how our oligarchs — oops, I’m sorry — our “wealth generators” have benefitted. The top 25 hedge fund managers took in an average $134 million in 2002. By 2009, their earnings went up to a billion dollars (that’s right: they each made a billion dollars a year!)

The market “correction” didn’t send them back to zero or to Sing Sing. Rather, by 2012, they were still making tons more than in 2002: $537 million. In fact, in 2010, these top 25 managers together made four times as much as the CEOs of the top 500 Standard and Poor companies — combined

These numbers make space station Elysium look more and more plausible.
As for the Obama administration’s effort to regulate Wall Street, it has been frankly half-hearted. The business world tried to upend Dodd-Frank and largely failed, but implementation of the reforms remains sketchy. Even that notoriously risky financial instrument, the commercial mortgage-backed security, is staging a comeback.

The 2016 presidential elections will address a range of issues, many of them entirely irrelevant. Foreign policy will inevitably surface as candidates debate the pros and cons of the Obama doctrine. But unless a major war has broken out by that point, Americans will focus as they usually do on their own wallets.

As such, the wisest candidates will focus on gross inequality. Piketty’s book, whether it’s read or not, should be a wake-up call for politicians. If inequality sells in the stores, it will sell at the polls as well.

At the end of Elysiumspoiler alert! — the 99 percent have given up their strategy of trying to break into the ranks of the super-wealthy on a case-by-case basis. It just wasn’t working. Instead, thanks to the Christ-like sacrifice of the Matt Damon character, they transform the entire system so that the health-case benefits of the magic machines are available to all.

It’s a powerful promo for universal health care, even it doesn’t address the tough questions of how the limited resources of a heavily slanted economy can be shared fairly among all. But where Hollywood films end is where U.S. politics must begin.


(John Feffer is the co-director of Foreign Policy In Focus.)

Yes, Geithner was an engaging, charming (almost) speaker on Colbert.

This next guy seems to reside more in rationality's actual realm about what happened during the response to the catastrophe and what should have happened in order to create a stable economic/financial future for U.S. citizen's to partake in - not that Geithner doesn't understand what providing for the common welfare for the country means in the Constitution (in my non-humble opinion).

Tim Geithner and the Wall Street Bailout Redux


May 14,2014

By Robert Reich

Timothy Geithner’s new book about the financial crisis, Stress Test, is basically an argument that the Wall Street bailout succeeded. That’s hardly surprising, given that Geithner was in charge of the bailout when Treasury Secretary (as was his predecessor at Treasury, Hank Paulson), and so has an inherent interest in telling the public it succeeded.

Even so, the bailout clearly did succeed, if success means avoiding another Great Depression.

But another Great Depression might have been avoided if the crisis had been handled differently — for example, by allowing the bankruptcy laws to do what they were intended to do, and forcing the big Wall Street banks to reorganize under them.

In fact, the bailout was a colossal failure in several respects Geithner barely mentions in his book, or avoids completely:

(1) The biggest Wall Street banks are now bigger than ever, and no sane person on or off the Street now believes Washington will ever allow them to fail – which means they’ll continue to make big, risky bets because they know they can’t fail. And they’ll get even bigger because big depositors and lenders know they’ll never fail and therefore demand lower interest rates than demanded from smaller banks.

(2) No Wall Street executives have ever been prosecuted for what they did to the country, which means even more rampant irresponsibility in executive suites as well as even deeper cynicism in the public about the political power of Wall Street.

(3) The bailout helped the banks but did little or nothing for the tens of millions of Americans who lost billions of dollars in home equity and savings, and the millions more who lost their jobs. The toll was greatest on the poor and the middle class, who still haven’t recovered their losses, even though Wall Street has fully recovered (and then some). Nor have reforms been enacted that will help the middle class and the poor the next time Wall Street implodes.

So pardon me if I take issue with Tim Geithner. The bailout was a success in the narrowest terms. Seen more broadly it was a terrible failure.

We’d have done better had we forced the biggest Wall Street banks, including the giant insurer AIG, to reorganize under bankruptcy rather than bail them out.

(This post originally ran on Robert Reich’s Web page.)