A Middle East Holocaust Coming? (If You Were Russia and China, and You Knew That America Had a War Doctrine Permitting a Surprise Nuclear Attack, Would You Sit There Waiting While War Machine Cranks Up?) SEC/NRC/NSA/TSA/MMS/DEA/CFTC/FBI/DOJ/Secret Service/Auditing/Fed Reserve/Treasury Corruption Rampant

. . . the human destruction of the oceans is yet more evidence of the ruinous nature of private capitalism. In capitalism there is no thought for the future of the planet and humanity, only for short-term profits and bonuses. Consequently, social costs are ignored.

Capitalism can work if social or external costs can be included in the costs of production. However, the powerful corporations are able to block a socially functioning capitalism with their political campaign contributions.

Consequently, capitalists themselves make the capitalist system dysfunctional. We may have reached the point where the external costs of production are larger than the value of capitalist output. Economist Herman Daly makes a convincing case that this is the fact.

After so many wars driven by American greed, who can doubt that more and worse ones are not already in process?

March 30, 2015

A Middle East Holocaust

Paul Craig Roberts

Foundations and corporations do not support truth-tellers. American foundations underwrite war and US imperialism. Foundations support subversion of countries that are not Washington’s puppet states. Your website has no foundation support, no corporate support; it only has your support.

I have been around for a long time and have experienced more than most. The current situation in my experience is the most dangerous time of all for humanity.

Nuclear weapons are no longer restrained by the Cold War MAD doctrine. Washington has released them into pre-emptive first strike form.

The targets of these pre-emptive strikes – Russia and China – know it, because Washington proudly proclaims its immorality in public documents describing its war doctrine.

The result is to maximize the chance of nuclear war. If you were Russia and China, and you knew that Washington had a war doctrine that permits a surprise nuclear attack, would you sit there waiting while Washington cranks up its anti-Russian and anti-Chinese propaganda machine, demonizing both countries as a threat to “freedom and democracy”?

The fools in Washington are playing with nuclear fire. Noam Chomsky points out that in a less dangerous time than currently exists, we came very close to nuclear war. https://philosophynow.org/issues/107/Noam_Chomsky_on_Institutional_Stupidity

Harold Pinter, one of the last Western intellects, understood the danger in Western arrogance. He denounced the West’s crimes and called for the crimes to be subject to established law before it is too late for humanity.

“We have brought torture, cluster bombs, depleted uranium, innumerable acts of random murder, misery, degradation and death to the Iraqi people and call it ‘bringing freedom and democracy to the Middle East’. How many people do you have to kill before you qualify to be described as a mass murderer and a war criminal? One hundred thousand? More than enough, I would have thought. Therefore it is just that Bush and Blair be arraigned before the International Criminal Court of Justice.”
- Harold Pinter, 2005 Nobel Prize Acceptance Speech.

“An Iraqi Holocaust” by Gideon Polya http://www.countercurrents.org/polya230315.htm and “Genocide In Iraq” http://www.countercurrents.org/polya150315.htm provide abundant evidence for convicting Bush and Blair.

Dr. Gideon Polya is a professor of science in one of Australia’s leading universities. He has a moral conscience, something increasingly rare in the Western world.

His articles are based largely on the just published by Clarity Press two-volume heavily documented Genocide in Iraq by Abdul-Haq Al-Ani and Tarik Al-Ani. Abdul-Haq Al-Ani is a British-educated lawyer with a Ph.D. in International Law and a Ph.D. in electronics engineering. Tarik Al-Ani, is an architect, translator, and researcher.

Currently I am reading the two-volume work and intended to review it. But Professor Polya’s articles suffice as an introduction to Genocide in Iraq. Washington has committed a terrible crime in our name. Washington not only murdered Iraq, Washington has murdered the Middle East. Washington and its despicable vassals – ”the Coalition of the Willing” – are responsible for a Middle East Holocaust.

For people in the Anglo-American world who have a moral conscience, the facts are soul-wrenching. The populations of the countries whose governments comprised “the Coalition of the Willing” are contaminated with war crimes committed by their governments in the Iraq Genocide. A progressive modern state was obliterated, and 2.7 million Iraqi people were murdered.

The crime was covered up with propaganda that demonized Saddam Hussein and created fear of nonexistent weapons of mass destruction.

The Iraqi genocide was based on a lie, and both Bush and Blair knew it. The two satanic leaders simply decided to destroy a people who they first demonized and marginalized.

Cheney and the neocons continue to justify the genocide and the illegal torture regime that they created in order to produce fake “terrorists” as a justification for their war crimes. The Western media, especially the "New York Times," is also complicit in the Iraqi Genocide as are the insouciant Western peoples themselves who stood by cheering while millions of people were destroyed on the basis of a blatant and transparent lie.

What does the West represent? Greed? Lies? War? Torture? War Crimes? Selfishness, Intolerance? Destruction of life on earth?

The “Christian” West is a master at propaganda and self-deception. Look at the evangelical churches. They support a criminal, inhumane regime while professing to be followers of Christ.

Look at American “conservatives.” They support the militarized police state. They support the routine police murders of dark-skinned American citizens. They support every war Washington dreams up and even more. Indeed, there are not enough wars for the satisfaction of Congressional Republicans who now want war with Russia and with Iran.

Look at the Republicans in Congress and in state governments. They hate the environment. They love polluters. They worship Israel and Israel’s destruction of the Palestinians and the ongoing theft of the Palestinians’ country, a 60-year old activity. Just look at the map of shrinking Palestine. More is stolen each day.

Washington has supported this theft of an entire country. Yet, Washington is able to masquerade as a great defender of human rights. Whose rights? Washington’s and Israel’s. No one else’s rights count.

How does the world survive the American-Israeli aggression? Probably it will not. The evil is now directed at Iran, Russia, and China. These countries cannot be bombed year after year after year with no consequences to the bombers.

Iran is limited in its destructive ability. But Iran could destroy Saudi Arabia and Israel. Russia and China can destroy the US and all of Washington’s vassal states. The intensity of Washington’s propaganda war is driving the world to destruction.

How can it be stopped when Putin himself says over and over that Washington continually ignores every thing that the Russian government says. Putin is the peacemaker. Every peace proposal he brings is ignored by Washington whose response is to beat the drums of war louder.

Unless European governments recognize the danger in Washington’s aggression and dissolve NATO, planet earth hasn’t long to live.

The American public needs to understand the consequences of Washington’s illegality and criminality. On the one hand it means that those subject to Washington’s aggression have to endure war crimes, but on the other hand it means a growing hatred for America. As Washington’s easy targets are used up, Washington engages countries that can reply to force with force.

Unless the neoconservatives are ejected from the Obama regime and banned from inclusion in any future American government, mushroom clouds will go up over Washington, New York, Boston, Atlanta, Los Angeles, San Francisco, Seattle, Dallas, Houston, St. Louis, Cleveland, Chicago. The American mid-west, which hosts the ICBM silos, will become uninhabitable except by cockroaches.

Americans, and the populations of the American puppet states, desperately need to understand that Washington is incapable of speaking the truth about anything. Washington is an evil force. Washington is Sauron. Washington is Satan.

Look at Iraq. Look at Afghanistan. Look at Libya. Look at Syria. Look at Somalia. Look at Ukraine. Nothing but destruction comes from Washington. Will life on earth be Washington’s next victim?

And all this uniquely American "goodness" in action comes down to porn watching?

Pay them enough and they will come.

Or let go of investigating financial and international chicanery.

← Accusations Emerge That the U.S. Is Aiding ISIS – The Latest “Conspiracy Theory” Circulating in Iraq

Government Corruption Has Become Rampant

March 30, 2015 by WashingtonsBlog

The Cop Is On the Take

Government corruption has become rampant:

• Senior SEC employees spent up to 8 hours a day surfing porn sites instead of cracking down on financial crimes

• Nuclear Regulatory Commission workers watch porn instead of cracking down on unsafe conditions at nuclear plants

• NSA spies pass around homemade sexual videos and pictures they’ve collected from spying on the American people

• NSA employees have also been caught using their mass surveillance powers to spy on love interests, such as girlfriends, obsessions or former wives … and to eavesdrop on American soldiers’ intimate conversations with their wives back home. And see this  (“routinely shared salacious or tantalizing phone calls that had been intercepted” …  “‘Hey, check this out … there’s good phone sex’”)

• An employee of the Transportation Security Administration admitted that TSA agents share – and laugh at – nude scans of passengers.

• Investigators from the Treasury’s Office of the Inspector General found that some of the regulator’s employees surfed erotic websites, hired prostitutes and accepted gifts from bank executives … instead of actually working to help the economy

• The Minerals Management Service – the regulator charged with overseeing BP and other oil companies to ensure that oil spills don’t occur – was riddled with “a culture of substance abuse and promiscuity”, which included “sex with industry contacts”

• Agents for the Drug Enforcement Agency had sex parties with prostitutes hired by the drug cartels they were supposed to stop

• Federal agents with the Drug Enforcement Administration and Secret Service investigating Bitcoin money laundering extorted and stole over $1 million in Bitcoin

• The Commodity Futures Trading Commission has conspired with big banks to manipulate commodities prices for decades

• The government-sponsored rating agencies committed massive fraud (and see this)

• The Treasury department allowed banks to “cook their books”

• Regulators knew of and allowed the use of debt-hiding accounting tricks by the big banks

• The Secretary of Treasury (Tim Geithner) was complicit in Lehman’s accounting fraud, (and see this)

• The former chief accountant for the SEC says that Bernanke and Paulson broke the law and should be prosecuted

• The government knew about mortgage fraud a long time ago. For example, the FBI warned of an “epidemic” of mortgage fraud in 2004. However, the FBI, DOJ and other government agencies then stood down and did nothing. See this and this. For example, the Federal Reserve turned its cheek and allowed massive fraud, and the SEC has repeatedly ignored accounting fraud. Indeed, Alan Greenspan took the position that fraud could never happen

• Paulson and Bernanke falsely stated that the big banks receiving TARP money were healthy, when they were not. The Treasury Secretary also falsely told Congress that the bailouts would be used to dispose of toxic assets … but then used the money for something else entirely

• A high-level Federal Reserve official says quantitative easing is “the greatest backdoor Wall Street bailout of all time”

• The SEC has been shredding Wall Street documents for decades to help the big banks cover up their fraud

• The non-partisan Government Accountability Office calls the Fed corrupt and riddled with conflicts of interest.
  
  Nobel prize-winning economist Joe Stiglitz says the World Bank would view any country which had a banking structure like the Fed as being corrupt and untrustworthy.
  
  The former vice president at the Federal Reserve Bank of Dallas said said he worried that the failure of the government to provide more information about its rescue spending could signal corruption. “Nontransparency in government programs is always associated with corruption in other countries, so I don’t see why it wouldn’t be here,” he said

• Arguably, both the Bush and Obama administrations broke the law by refusing to close insolvent banks

• Congress may have covered up illegal tax breaks for the big banks

• Police have been busted framing innocent people

• Warmongerers in the U.S. government knowingly and intentionally lied us into a war of aggression in Iraq.
  
  The former head of the Joint Chiefs of Staff – the highest ranking military officer in the United States – said that the Iraq war was “based on a series of lies”. The same is true in Libya and other wars

• The government lied when it said it doesn’t conduct mass surveillance on Americans, lied about the extent of the torture program, and lied when it said torture was aimed at protecting America against terrorists

• The government made sure that false claims were made about the amount of oil spilled by BP in the Gulf

• The government has framed whistleblowers with false evidence

• The Pentagon falsely smeared USA Today reporters because they investigated illegal Pentagon propaganda

• When one of the most respected radiologists in America – the former head of the radiology department at Yale University – attempted to blow the whistle on the fact that the FDA had approved a medical device manufactured by General Electric because it put out massive amounts of radiation, the FDA installed spyware to record his private emails and surfing activities (including installing cameras to snap pictures of his screen), and then used the information to smear him and other whistleblowers

• In an effort to protect Bank of America from the threatened Wikileaks expose of wrongdoing – the Department of Justice told Bank of America to a hire a specific hardball-playing law firm to assemble a team to take down WikiLeaks (and see this)

• The Bush White House worked hard to smear CIA officers,  bloggers and anyone else who criticized the Iraq war

• The FBI smeared top scientists who pointed out the numerous holes in its anthrax case

The biggest companies own the D.C. politicians. Indeed, the head of the economics department at George Mason University has pointed out that it is unfair to call politicians “prostitutes”.  They are in fact pimps … selling out the American people for a price.

Government regulators have become so corrupted and “captured” by those they regulate that Americans know that the cop is on the take.   Institutional corruption is killing people’s trust in our government and our institutions.
Indeed, America is no longer a democracy or republic … it’s officially an oligarchy.
The allowance of unlimited campaign spending allows the oligarchs to purchase politicians more directly than ever.    Moreover, there are two systems of justice in America … one for the big banks and other fatcats, and one for everyone else.

But the private sector is no better … for example, the big banks have turned into criminal syndicates.

Liberals and conservatives tend to blame our country’s problems on different factors … but they are all connected.

The real problem is the malignant, symbiotic relationship between big corporations and big government.

(Social Costs Of Capitalism Are Destroying Earth’s Ability To Support Life) In Which the Would-Be Enforcement Official Cravenly Compliments the Industry He Supposedly Polices and Then Jokingly Puts Forward His Own Son As a Candidate for Job in Private Equity (Financial Feudalism Explained)

What’s Wrong with the Economy — and with Economics?

Wait, you mean the gutting and deading of extreme capitalism has had a few downside social costs?

And WTF are social costs? (And who cares anymore anyway?)

Aren't we the noveau Richie Riches now? (It's good to be king.)

. . . the external cost imposed on the climate by fossil-fuel use is the source of the life-threatening crisis that humanity confronts. Capitalists make money by exploiting labor and by externalizing the costs of the wastes produced by the productive process by imposing the wastes on the environment. It is the short-term time horizon of production organized by selfish private interests focused on quarterly profits that is destroying the livability of the earth.The Social Costs Of Capitalism Are Destroying Earth’s Ability To Support Life

Regulatory Capture, Captured on Video

By Matt Taibbi, "Rolling Stone"

27 March 15

SEC official slobbers over private equity titans, suggests his son might want a job in the field

his is courtesy of Yves Smith over at "Naked Capitalism," who's been following the strange story of SEC Examination chief Andrew Bowden's evolving position on financial corruption for a while.

That story blew up recently in a remarkable public appearance by Bowden, in which the would-be enforcement official cravenly compliments the industry he supposedly polices and then — get this — jokingly puts forward his own son as a candidate for a job in private equity. On video. You won't see a more brazen example of regulatory capture anywhere.

Some brief backstory. Just a little under a year ago, Bowden, the SEC's Director of Compliance Inspections and Examinations, gave a speech that was remarkably, unusually critical of the Private Equity field. Bowden had conducted a study of the Private Equity buSsiness and found that over half of the companies they looked at were guilty of ripping off their clients:

By far, the most common observation our examiners have made when examining private equity firms has to do with the adviser's collection of fees and allocation of expenses. When we have examined how fees and expenses are handled by advisers to private equity funds, we have identified what we believe are violations of law or material weaknesses in controls over 50 percent of the time.

To fully explain what Bowden is talking about here would require a much longer article, but the basics go something like this.

Private Equity reptiles like Mitt Romney make their living borrowing huge sums of money, millions and billions, from investors called "limited partners." They then take that borrowed money and acquire companies with that cash, sometimes with the company's consent, sometimes without it.

The ostensible object of the exercise (at least, this is the way folks in the Private Equity business would describe it) is to make money for the limited partners by acquiring flawed firms, turning them around, and channeling the profits from the reborn target firm back to the investors.

However, from another point of view, the more immediate object of the exercise is to make money for the Private Equity firm. This can be achieved in virtually countless ways once these takeover parasite-pirates have latched on to their target. But the most reliable way of making cash is to soak the acquired company for huge masses of fees, both legit and not.

The always-excellent Gretchen Morgensen brought up a great example last year, in a piece about a company called Biomet that had been taken over by a consortium of PE partnerships. She wrote that Biomet will be forced to keep paying about $30 million in "monitoring fees" through 2017, which as Morgensen notes is two years after the deal closes.

In other words, she wrote, "Blackstone, Goldman Sachs, K.K.R. and TPG will be paid for two years of services that Biomet isn't receiving."

Anyway, last year, Andrew Bowden at the SEC found that over half of the PE/LBO firms he looked at were doing something wrong with fees.

One of the most common scams involves the use of something called "Operating Partners." In essence, the PE firm forces the target company to hire their people as independent contracting consultants.

As Bowden put it, these "Operating Partners" are typically Wall Street hotshots whose services "the portfolio companies could not independently afford."

The scam here, as Yves Smith points out, is that the investors think that the Private Equity firm is paying for these managers, while in fact they're being paid for by the acquired company. As Smith says, this scheme essentially robs the investors:

From an economic perspective, every dollar that comes out of a portfolio company this way is effectively stolen from the limited partner investors, since they would otherwise have the first claim on the portfolio companies' cash flows.

All of which is a complicated way of saying the following: Takeover Artist Jerks use hidden fees to rip investors off.

Last May, Bowden, a senior SEC official, described this problem as almost epidemic. The SEC looked at 150 companies and over half were guilty of something.

A year later? They're not so worried.

It raised some eyebrows over the course of last summer and fall when the SEC did not follow up on Bowden's remarks.

Even some Private Equity trade publications began to wonder aloud where the beef was, noting that "there hasn't been much additional commentary" from the SEC since Bowden's aggressive speech last May.

Bowden himself seemed to walk back some of his comments in an interview last September. "Anecdotally," he said, "I would say there have been some changes in the behavior on the part of funds and investors and that's all for the good."

Anecdotally? It is a very odd thing to hear a regulator in the middle of a granular, industry-wide examination say that he's heard that things are getting better.

Regulation by

rumor is not your typical enforcement MO.

By this month, Bowden had achieved a complete 180, telling a conference of PE professionals that their business was just "the greatest."

This is Bowden on March 5th, on a panel for PE and Venture Capital issues at Stanford. Check out how he pooh-poohs the fact that his SEC has seen "some misconduct," before he goes on to grovel before his audience:



Like what, who else out there is in a business that's that good? And I reckon, it's sort of interesting for me for private equity in terms of all we've seen, and what we have seen, where we have seen some misconduct and things like that, 'cause I always think like, to my simple mind, that the people in private equity, they're the greatest, they're actually adding value to their clients, they're getting paid really really well, you know...

Not the usual posture you'd expect from an enforcement official. He likes the Private Equity business! They make a lot of money! They help people! And that thing about half of those businesses committing fee abuses, that's just "some misconduct" we found last year. No big deal!

It got worse, though:

Bowden: And so my view on the small ones is, I still think this is one of…I tell my son, I have a teenaged son, I tell him, “Cole, you want to be in private equity. That's where to go, that's a great business, that's a really good business. That'll be good for you.”

So for me personally, as we share our opinions…

Questioner [interrupting] I'd love to hire your son, by the way. That's a deal.

Bowden's comments certainly raised a few eyebrows. The LA Times wrote quite critically about them, as did a few other outlets.

There are some people who will say it's easy to overreact to something like this. If you listen to the tape, Bowden makes his comments in a joking manner, and everyone laughs. It's not like he brought his son onstage and had him hand out resumes after the speech.

But no government regulator with his or her head screwed on correctly would ever go near a joke like that in public. Even if it's not what it very much appears to be, it sounds incredibly bad.

And, worse, it reveals an attitude that's absolutely poisonous among regulators, this fawning worship of people on Wall Street who maybe break a few rules, but that's okay, because they make tons of money! Can you imagine Elliott Ness giving a speech gushing over what nice cars Al Capone drives? It's revolting.

It's not necessary for regulators to hate the greedy bottom-liners who go around toying with peoples' jobs and livelihoods using borrowed money.

It's not even necessary for regulators to hate those same rich takeover artists for paying half the taxes of most ordinary people, because our bought-off government refuses to close the loophole that allows Mitt Romney to call the money he makes "carried interest" instead of income.

We don't need regulators to be out to get anyone. But is a healthy indifference too much to ask? Do we really need for even the regulators to slobber over these people?

Comments:

+19 # PCPrincess 2015-03-27 09:38

I am now quite certain that the portion of human beings that do not possess a large level of empathy (a vast majority) are not capable of self-regulation . Hence, capitalism is NOT possible in any form or sense. My only hope for human-kind are the empathy-bearing progressives. May we find the strength and will to fight even though the oligarchs have ensured we are stressed to the limit just making ends meet.

+10 # wrknight 2015-03-27 10:14

The most important and hardest job of a president is the selection of qualified personnel to carry out the day to day functions of his administration. As a president, Obama has been the greatest disappointment I could ever imagine. His one great achievement was the passing of Obamacare which accomplished only half what he promised. But his greatest failure was in the selection of his staff and cabinet, many of whom were hold-overs from the worst administration ever. How any president, who was fully aware of the sins of his predecessor, could retain those subordinates who were most guilty of executing those sins is simply beyond me. While he may be a great orator, he has been a complete failure as an administrator. Bowden is just one of many examples.

+6 # Edwina 2015-03-27 10:29

The WSJ today states that Elliot Spitzer did untold damage in his attempts to regulate Wall Street. While I am not sophisticated about the ins-and-outs of the SEC and Wall Street, it seems to me that the WSJ is becoming openly propagandistic, rather subtly representing its "natural" interests.

+2 # wrknight 2015-03-27 10:34

Quoting Edwina: 
The WSJ today states that Elliot Spitzer did untold damage in his attempts to regulate Wall Street. While I am not sophisticated about the ins-and-outs of the SEC and Wall Street, it seems to me that the WSJ is becoming openly propagandistic, rather subtly representing its "natural" interests.

When has it not been?

0 # Floridatexan 2015-03-27 11:38

Before Rupert Murdoch bought it.

+3 # BuzzDavis 2015-03-27 10:39

Thank you Matt & Yves Smith. Enforcement of laws at the Fed. level is extreemly had to follow for citizens. We expect that the thousands of workers hired to conduct enforcement do just that. But the bureaucracy has always put gatekeepers in control. The success in enforcement work is to be able to circumvent the gatekeepers. Bowden is an example of how slime politicians put gatekeepers at the head of almost all enforcement so the politicians are in control of the enforcement not the professionals. Without reporting like this the slime forever wins!

_ _ _ _ _ _ _

Wherein, we learn from incredibly prosaic sources the truth:   that the move of big business to shale oil, tar sands, the mining of the earth for black gold (not to mention the melting of the glaciers) for the last bit of big profit was the end game.

For us all.

March 24, 2015

Financial Feudalism

Once upon a time — and a fairly long time it was — most of the thickly settled parts of the world had something called feudalism. It was a way of organizing society hierarchically. Typically, at the very top there was a sovereign (king, prince, emperor, pharaoh, along with some high priests). Below the sovereign were several ranks of noblemen, with hereditary titles. Below the noblemen were commoners, who likewise inherited their stations in life, be it by being bound to a piece of land upon which they toiled, or by being granted the right to engage in a certain type of production or trade, in case of craftsmen and merchants. Everybody was locked into position through permanent relationships of allegiance, tribute and customary duties:  tribute and customary duties flowed up through the ranks, while favors, privileges and protection flowed down.

It was a remarkably resilient, self-perpetuating system, based largely on the use of land and other renewable resources, all ultimately powered by sunlight. Wealth was primarily derived from land and the various uses of land. Here is a simplified org chart showing the pecking order of a medieval society.

Feudalism was essentially a steady-state system. Population pressures were relieved primarily through emigration, war, pestilence and, failing all of the above, periodic famine. Wars of conquest sometimes opened up temporary new venues for economic growth, but since land and sunlight are finite, this amounted to a zero-sum game.

But all of that changed when feudalism was replaced with capitalism. What made the change possible was the exploitation of nonrenewable resources, the most important of which was energy from burning fossilized hydrocarbons:  first peat and coal, then oil and natural gas. Suddenly, productive capacity was decoupled from the availability of land and sunlight, and could be ramped up almost, but not quite, ad infinitum, simply by burning more hydrocarbons.

Energy use, industry and population all started going up exponentially. A new system of economic relations was brought into being, based on money that could be generated at will, in the form of debt, which could be repaid with interest using the products of ever-increasing future production.

Compared with the previous, steady-state system, the change amounted to a new assumption:  that the future will always be bigger and richer — rich enough to afford to pay back both principal and interest.

With this new, capitalistic arrangement, the old, feudal relationships and customs fell into disuse, replaced by a new system in which the ever-richer owners of capital squared off against increasingly dispossessed labor. The trade union movement and collective bargaining allowed labor to hold its own for a while, but eventually a number of factors, such as automation and globalization, undermined the labor movement, leaving the owners of capital with all the leverage they could want over a demoralized surplus population of former industrial workers.

In the meantime, the owners of capital formed their own pseudo-aristocracy, but without the titles or the hereditary duties and privileges. Their new pecking order was predicated on just one thing:  net worth. How many dollar signs people have next to their name is all that's necessary to determine their position in society.

But eventually almost all the good, local sources of hydrocarbon-based energy became depleted, and had to be replaced using lower-quality, more remote, harder-to-produce, more expensive ones.

This took a big bite out of economic growth, because with each passing year more and more of it had to be plowed right back into producing the energy needed to simply sustain, never mind grow, the system.

At the same time, industry produced a lot of unpleasant byproducts: environmental pollution and degradation, climate destabilization and other externalities. Eventually these started showing up as high insurance premiums and remediation costs for natural and man-made disasters, and these too put a damper on economic growth.

Population growth has its penalties too. You see, bigger populations translate to bigger population centers, and research results show that the bigger the city, the higher is its energy use per capita. Unlike biological organisms, where the larger the animal, the slower is its metabolism, the intensity of activity needed to sustain a population center increases along with population. Observe that in big cities people talk faster, walk faster, and generally have to live more intensely and operate on a tighter schedule just to stay alive.

All of this hectic activity takes energy away from constructing a bigger, richer future. Yes, the future may be ever more populous (for now) but the fastest-growing form of human settlement on the planet is the urban slum—lacking in social services, sanitation, rife with crime and generally unsafe.

What all of this means is that growth is self-limiting. Next, observe that we have already reached these limits, and have in some cases gone far beyond them. The currently failing fad of hydraulic fracturing of shale deposits and steaming oil out of tar sands is indicative of the advanced state of depletion of fossil fuel sources.

Climate destabilization is producing ever more violent storms, ever more severe droughts (California now has just a year's worth of water left) and is predicted to wipe out entire countries because of rising ocean levels, failing monsoon seasons and dwindling irrigation water from glacial melt.

Pollution has likewise reached its limits in many areas:  urban smog, be it in Paris, Beijing, Moscow or Teheran, has become so bad that industrial activities are being curtailed simply so that people can breathe. Radioactivity from the melted-down nuclear reactors at Fukushima in Japan is showing up in fish caught on the other side of the Pacific Ocean.

All of these problems are causing a very strange thing to happen to money. In the previous, growth phase of capitalism, money was borrowed into existence in order to bring consumption forward and by so doing to stimulate economic growth.

But a few years ago a threshold was reached in the US, which was at the time still the epicenter of global economic activity (since eclipsed by China), where a unit of new debt produced less than one unit of economic growth. This made borrowing from the future with interest no longer possible.

Whereas before money was borrowed in order to produce growth, now it had to be borrowed, in ever-larger amounts, simply to prevent financial and industrial collapse. Consequently, interest rates on new debt were reduced all the way to zero, in something that came to be known as ZIRP, for Zero Interest Rate Policy. To make it even sweeter, central banks accepted the money they loaned out at 0% interest as deposits, which earned a tiny bit of interest, allowing banks to make a profit by doing absolutely nothing.

Unsurprisingly, doing absolutely nothing proved to be rather ineffective, and around the world economies started to shrink. Many countries resorted to forging their statistics to paint a rosier picture, but one statistic that doesn't lie is energy consumption.

It is indicative of the overall level of economic activity, and it is down across the entire world. A glut of oil, and a much lower oil price, is what we are currently witnessing as a result. Another indicator that doesn't lie is the Baltic Dry Index, which tracks the level of shipping activity, and it has plummeted too.

And so ZIRP set the stage for the latest, most queer development:  interest rates have started to go negative, both on loans and deposits. Good bye, ZIRP, hello, NIRP!

Central banks around the world are starting to make loans at small negative rates of interest. That's right, certain central banks now pay certain financial institutions to borrow money! In the meantime, interest rates on bank deposits have gone negative as well: keeping your money in the bank is now a privilege, for which one must pay.

But interest rates are certainly not negative for everyone. Access to free money is a privilege, and those who are privileged are the bankers, and the industrialists they fund.

Those who have to borrow to finance housing are less privileged; those who borrow to pay for education even less so. Those not privileged at all are those who are forced to buy food using credit cards, or take out payday loans to pay rent.

The functions which borrowing once played in capitalist economies have been all but abandoned. Once upon a time, the idea was that access to capital could be obtained based on a good business plan, and that this allowed entrepreneurship to flourish and many new businesses to be formed. Since anybody, and not just the privileged, could take out a loan and start a business, this meant that economic success depended, at least to some extent, on merit.

But now business formation has gone in reverse, with many more enterprises going out of business than are being formed, and social mobility has become largely a thing of the past.

What is left is a rigidly stratified society, with privileges dispensed based on hereditary wealth:   those at the top get paid to borrow, and get to surf on a wave of free money, while those at the bottom are driven ever further into debt servitude and destitution.

Can NIRP underpin a new feudalism? It certainly cannot reverse the downward slide, because the factors that are putting limits on growth are not amenable to financial manipulation, being physical in nature.

You see, no amount of free money can make new natural resources spring into existence. What it can do, however, is freeze the social hierarchy among the owners of capital — for a while, but not forever.

Everywhere you care to look, the ever-shrinking economy eventually results in populist revolt, war and national bankruptcy, and these cause money to stop working in a number of ways.

There is usually devaluation, bank failures, inability to finance imports, and the demise of pensions and of the public sector. The desire to survive causes people to focus on getting direct access to physical resources, distributing them among friends and family.

In turn, this causes market mechanisms to become extremely opaque and distorted, and often to stop functioning altogether. Under these circumstances, how many dollar signs someone has next to their name becomes rather a moot point, and we should expect the social hierarchy among the owners of capital to become unstable and capsize.

A few among them have the talents to become warlords, and these few fleece the rest out of existence. But overall, in a situation where financial institutions have failed, where factories and other enterprises are no longer functioning, and where real estate holdings have been overrun by marauding mobs and/or invaded by squatters, one's net worth becomes rather difficult to compute. And so we should expect the org chart of the post-capitalist society, in spreadsheet terms, to look like this. (“#REF!” is what Excel displays when it encounters an invalid cell reference in a formula.)

A good, precise term for this state of affairs is “anarchy.” Once a new, low level of steady-state subsistence is reached, the process of aristocratic formation can begin anew. But unless a new source of cheap fossil fuels is somehow magically discovered, this process would have to proceed along the traditional, feudal lines.