http://www.globalresearch.ca/index.php?context=va&aid=13077
Bernanke's Financial Rescue Plan: The growing prospect of a U.S. default
.......The IMF Communique to the G 20:
“The prolonged financial crisis has battered global activity beyond what was previously anticipated. Global GDP is estimated to have fallen by an unprecedented 5% in the fourth quarter, led by the advanced economies, which contracted by 7%. GDP declined by around 6% in both the United States and Europe, while it plummeted at a post-war record of 13% in Japan. Growth also plunged across a broad swath of emerging economies … against this backdrop, global activity is expected to contract in 2009 for the first time in 60 years.”
Bernanke's monetary stimulus strategy will do little to mitigate the severity of the contraction which has already gripped every sector of the economy. Credit more than doubled in the first few years of the new millennium. In fact, that total system credit jumped from $1.75 trillion in 2000 to $4.4 trillion in 2007. At the same time, the Current Account Deficit--which averaged about $100 billion per year during the 1990s-- ballooned to a whopping $788 billion in 2006. Clearly, the Fed's flood of low interest credit coupled with unsustainable deficits put the country on course for a major catastrophe. (Greenspan still says he never saw it coming) Now that the bubble has burst, Bernanke, has gone into panic-mode, frantically firehosing the entire financial system with liquidity, but with little effect. The sheer magnitude of the deflationary tidal wave is unprecedented. Here's author and economist Henry Liu:
"Globally, the dollar-denominated financial system has seen its equity market capitalization value fall by between 40-60% by February 2009....On October 31, 2007, the total market value of publicly-traded companies around the world was $62.6 trillion. By December 31, 2008, the value had dropped nearly half to $31.7 trillion. The gap of lost wealth, $30.9 trillion, is approximately the combined annual Gross Domestic Product of the US, Western Europe, and Japan.... Family net worth hit a record high of $64.36 trillion in 2nd quarter of 2007. By 4th quarter 2008, it fell to $51.48 trillion, a loss of $12.88 trillion. To restore the wealth lost in the current financial crisis, the Treasury would have to monetize some $30 trillion of toxic assets, almost ten times what the Geithner Treasury is currently contemplating, and twice the size of current US annual GDP. Add to that about $10 trillion of value lost in the collapse of commodity prices and another $10 trillion in real property values, and we have a wealth loss of $50 trillion."(Obama’s Politics of Change and US Policy on China, asia Times, Henry Liu)
Nearly half of the world's wealth has been consumed in one gigantic capital bonfire. No amount of "quantitative easing" will undo the damage to the economy. Here's a clip from Merrill Lynch's David Rosenberg adding more perspective to Liu's comments:
"Government cannot prevent nature from taking its course. While an additional $1.15 trillion expansion of the Fed’s balance sheet is large as a stand-alone event, it really is just a drop in the bucket when one considers that there is still almost $8 trillion of combined household and business sector credit that must be unwound in order to mean-revert the private sector-to-GDP ratio (which is still close to a record-high). Once again, the government is cushioning the blow, but cannot prevent nature from taking its course.
(We) feel much more confident that corporate earnings are going to slide again this year....The economy continues to contract … job losses, declining equity and housing wealth, and tight credit conditions have weighed on consumer sentiment and spending. Weaker sales prospects and difficulties in obtaining credit have led businesses to cut back on inventories and fixed investment. US exports have slumped as a number of major trading partners have also fallen into recession”. This is with the Fed funds rate effectively at zero. It’s pretty clear that the Fed does not see any flicker of light at the end of the tunnel just yet. Mr. Market may be in for yet another surprise." (Interview with David Rosenberg, Tech Ticker)
The system-wide contraction can't be stopped by supporting financial institutions that made bad bets or took on perilous amounts of debt leaving them deep in the red. Fed lending should be aimed at companies that need temporary help only, like rolling over loans or getting through a rough patch while inventories are trimmed and consumers retrench. Similarly, the stimulus (monetary or fiscal) shouldn't be used to reflate assets or to try to reverse the market correction, but to maintain aggregate demand, take up slack in the sluggish economy, create jobs, and soften the blow for the victims of Wall Street's bubblenomics. Bernanke has used monetary stimulus in precisely the way it should not be used, to keep asset prices artificially high despite the cooling off in the stock market, falling corporate profits, and the steeply rising unemployment. There should be a sharp reduction in the amount lending to financial institutions, reflecting the decline in the value of the underlying assets which are now priced at roughly 30 cents on the dollar. Bernanke's job is to wind-down these positions, not perpetuate the problem at the taxpayer's expense.
According to Bloomberg: "The Federal Reserve’s top two officials assured that they will pull back their emergency- credit programs once the crisis fades, even as they prepare to flood the system further with an excess of $1 trillion.
Chairman Ben Bernanke said yesterday in Charlotte, North Carolina that the Fed must retain the flexibility to withdraw its record cash injections to restrain prices. Vice Chairman Donald Kohn said in Wooster, Ohio, “the trick will be unwinding this balance sheet in a timely way to avoid inflation.”
This is pure fiction. Bernanke has no exit strategy because the collateral the Fed now holds on its books will never regain anything near its original value. Securitization turned 80% of shaky subprime loans into AAA assets for which the Fed is now providing full value vis a vis its low interest loans. The Fed chief has made the same bad bet that the financial institutions made, and is now adding to that mistake by buying $750 billion in junk loans from Fannie and Freddie and $300 billion in US Treasurys to push investors out of the safety of cash back into the market. It's lunacy. All of this is putting more and more pressure on the dollar which could experience severe dislocation if Bernanke does not make a reasonable attempt to do what is necessary to resolve the banks, shore up consumer spending, shut down underwater financial institutions (auction their toxic assets through a RTC government-run facility) and stop trying to reassemble a broken system.
Bernanke is in way over his head. He has no plan for expanding conventional lending or strengthening the parts of the system that still work. All his efforts have been focused on salvaging insolvent banks and restarting securitization. Securitzation--transforming pools of loans into securities---was Wall Street's Golden Goose, a privately-owned credit-generating mechanism which created windfall profits by selling radioactive waste to over-trustful investors. Securitization is the epicenter of the shadow banking system, the mostly-unregulated universe of opaque debt-instruments, off balance sheet operations, and massively over-leveraged financial institutions. Securitization broke down after subprime mortgages began defaulting in record numbers sending risk-adverse investors scuttling for the exits. To illustrate how frozen the securitzation market is at present, here's a blurp from the Wall Street Journal: "Outside the market where the Fed is a buyer for securities backed by mortgage loans that conform to Fannie and Freddie standards, there hasn't been a new deal since 2007, according to FTN Financial, a fixed-income broker dealer." (Wall Street Journal, Credit Markets Still Navigate in a Choppy Sea of Liquidity)
Repeat: "No new deals since 2007."
Again from the Wall Street Journal:
"Banks and other finance companies making loans for autos, credit cards and college tuition are having virtually no success in selling those loans to other investors, a potent sign of just how tight credit markets remain.
The market for selling such loans — by packaging, or securitizing, them into bonds — had just one $500 million deal for all of October, according to Barclays Capital. That compares with $50.7 billion worth of deals made one year earlier, according to market-research firm Dealogic.” (Bond Woes Choke off some Credit to Consumers, Wall Street Journal, Robin Sidel)
Securitzation is dead, and yet, Bernanke and Geithner want to shovel another $2 trillion into this black hole hoping to lure investors back to the market. Why? Because Wall Street financiers and bank mandarins see securitization as an efficient model that can be exported into any market around the world. The repackaging of debt into complex instruments, that can be stealthily created in off balance sheet operations requiring smaller and smaller slices of capital, is the essential flimflam product that Wall Street intends to use to dominate global financial markets. Keeping secutization alive is ultimately about power; pure, unalloyed economic power. That is why Bernanke will spare no expense trying to resuscitate this failed system.
What's so destructive about securitzation is that it allows the banks to create credit out of thin air through unregulated, clandestine operations, which eliminate transparency and makes it impossible for the Fed to control the money supply. David Roache explains how this works in an excerpt from his book "New Monetarism" which appeared in the Wall Street Journal:
"The reason for the exponential growth in credit, but not in broad money, was simply that banks didn't keep their loans on their books any more-and only loans on bank balance sheets get counted as money. Now, as soon as banks made a loan, they "securitized" it and moved it off their balance sheet.
There were two ways of doing this. One was to sell the securitized loan as a bond. The other was "synthetic" securitization: for example, using derivatives to get rid of the default risk (with credit default swaps) and lock in the interest rate due on the loan (with interest-rate swaps). Both forms of securitization meant that the lending bank was free to make new loans without using up any of its lending capacity once its existing loans had been "securitized."
So, to redefine liquidity under what I call New Monetarism, one must add, to the traditional definition of broad money, all the credit being created and moved off banks' balance sheets and onto the balance sheets of nonbank financial intermediaries. This new form of liquidity changed the very nature of the credit beast. What now determined credit growth was risk appetite: the readiness of companies and individuals to run their businesses with higher levels of debt. (Wall Street Journal)
The banks have been creating trillions of dollars of credit without maintaining adequate capital reserves to back them up. That explains why the banks were so eager to provide mortgages to millions of loan applicants who had no documentation, no income, no collateral and a bad credit history. They believed there was no risk, because they were making enormous profits without tying up any of their capital........
Sunday, May 31, 2009
Saturday, May 30, 2009
SC92-2
http://www.globalresearch.ca/index.php?context=va&aid=13050
The Smooth Criminal Transition from Bush/Cheney to Obama
Corrupt new administration deepens and expands systemic criminalization and war agenda
To sober, clear-eyed observers of history and political deception, the ascension of Barack Obama held the promise for unprecedented new dangers: a revitalized New World Order, led by the Anglo-American empire’s neoliberal criminal faction and an iconic, deceptive new facilitator; and a continuation of Bush/Cheney criminality and war, under smarter and much more effective management.
Now, just months into their tenure, the Barack Obama administration has more than fulfilled the murderous promises he made to his elite constituency, deepening the mass destruction of Bush/Cheney, while charming its victims all over the world into enjoying their own demise.
The empire’s facilitator
Beneath his seemingly boundless charisma and charm, Barack Obama has always been an utterly ruthless politician. He has been a compromiser who has danced with the darkest forces of political and criminal power, while winning over common people; a consensus-abiding chameleon and a “pragmatist”. Obama is the true model of what George W. Bush only claimed to be: “a uniter, not a divider”.
The signs were clear from the early days of the presidential contest that Obama was, like every presidential candidate, a handpicked puppet. His cadre of national security and foreign policy advisors included the most notorious war criminals, intelligence/security “advisors” and corrupt think tank assets in the world. His campaign was bankrolled by Wall Street, and big corporations. His policy agenda was taken from the playbook of the Bilderberg Group, the Council on Foreign Relations and the Trilateral Commission. Both neoliberal (and neocon) elite power and money coalesced behind Obama, as his political rivals dropped off.
Obama’s record in the US Senate was one of general complicity with Bush/Cheney and the status quo, including enthusiastic support of the consensus "war on terrorism" deception and the big 9/11 lie. Former US congresswoman Cynthia McKinney has described how, in her encounters with Obama, the senator from Illinois repeatedly refused to act in opposition to Bush/Cheney policies. Time again, during his days in the Senate, and throughout the presidential campaign, Obama has not only fully supported the Bush/Cheney administration on the Patriot Act, and the wholesale the militarization and criminalization of the United States.
Immediate destabilization
The naïve, the hopeful and the ignorant have continued to harbor fantasies about “change”, even as Obama promptly destroyed every single hope, starting with the composition of his administration. He hand picked a transition team, and then a cabinet consisting entirely of legendary war criminals and corrupt elites, each more malodorous and corrupt than the next. From Iran-Contra participant Robert Gates and war criminal Richard Holbrooke, to Hillary Clinton and an economic advisory team comprised of the architects of Wall Street destruction, including Paul Volcker, Robert Rubin, Larry Summers, and new Treasury Secretary Timothy Geithner.
Under Geithner and Federal Reserve chairman Ben Bernanke, the Ponzi scheme that is Wall Street, the wholesale robbery of the American people begun by Alan Greenspan, Bernanke, and Bush/Cheney Treasury Secretary Hank Paulson has not only continued unabated, but has metastasized with each new bailout, and every new fraud orchestrated by Geithner.
While the people on “Main Street” have continued to suffer a new Great Depression without real assistance from the Obama administration, the New World Order’s financial coffers continue to fill with stolen US taxpayer money. No relief for the impoverished, while the administration “bails out” banks and Wall Street, under such frauds as the "Public Private Partnership Program". Leaving the wolves in charge of the financial henhouse, Geithner and the Obama administration authorized Congress to toss out securities pricing standards on “toxic assets”. (Also see this op-ed, and the piece by Arthur Leavitt, former head of the SEC, and the Carlyle Group.) Essentially, the Obama administration is simply going to let the banks and financial institutions, that created the crisis with their massive Ponzi schemes, determine how they wish to price their own “toxic assets”.
This move, not surprisingly, sparked a huge Wall Street rally. Some even hailed it as the end of the crisis.
A criminal stimulus plan
Obama’s so-called stimulus package is yet another Trojan horse. As exhaustively and incisively detailed by Michel Chossudovsky in “America's Fiscal Collapse”:
“This is a ‘War Budget’. The austerity measures hit all major federal spending programs with the exception of: 1. Defence and the Middle East War: 2. the Wall Street bank bailout, 3. Interest payments on a staggering public debt.
“The Obama stimulus program constitutes a continuation of the Bush administration's bank bailout packages. The proposed policy solution to the crisis becomes the cause, ultimately resulting in further real economy bankruptcies and a corresponding collapse of the standard of living of Americans.
“Both the Bush and Obama bank bailouts are intended to come to the rescue of troubled financial institutions, to ensure the payment of ‘inter-bank’ debt operations. In practice, large amounts of money transit through the banking system, from the banks to the hedge funds, to offshore banking havens and back to the banks.
“What we are dealing with is the fraudulent transfer and confiscation of lifelong savings and pension funds, the fraudulent appropriation of tax revenues to finance the bank bailouts, etc. To understand what has happened: follow the money trail of electronic transfers with a view to establishing where the money has gone.
“What is at stake is the outright criminalization of the financial system: ‘financial theft’ on an unprecedented scale........
........A report by Tyler Durden, citing an anonymous insider trader involved with AIG trades, reveals that manipulation fraudulently transferred US taxpayer money to AIG’s counter-parties---the top banks and financial institutions---with AIG as the “pass-through”. The profit report sparked a market rally that comes at the expense of US taxpayers.
The complete report (thanks to Jenna and the Mike Ruppert Blogspot for this find) is damning and startling:
Exclusive: Big Banks' Recent Profitability Due to AIG Scam?
Excerpt:
“AIG, knowing it would need to ask for more capital from Treasury imminently, decided to throw in the towel, and gifted major bank counter-parties with trades which were egregiously profitable to the banks, and even more egregiously money-losing to the U.S. taxpapers, who had to dump more and more cash into AIG, without having the U.S. Treasury Secretary Tim Geithner disclose the real extent of this---for lack of a better word---fraudulent scam.
“…What this all means is that the statements by major banks, i.e. JP Morgan Chase, Citi, and BofA regarding abnormal profitability in January and February were true, however these profits were a) one-time in nature due to wholesale unwinds of AIG portfolios, b)entirely at the expense of AIG, and thus taxpayers, c) executed with Tim Geithner’s (and thus the administration’s) full knowledge and intent, d) were basically a transfer of money from taxpayers to banks (in yet another form) using AIG as an intermediary [my emphasis-LC].
“For banks to proclaim their profitability in January and February is about as close to criminal hypocrisy as is possible. And again, the taxpayers fund this “one time profit”, which causes a market rally, thus allowing the banks to promptly turn around and start selling more expensive equity…also funded by taxpayers’ money flows into the market. If the administration is truly aware of these events (and if Zero Hedge [the name of the author-LC] knows about it, it is safe to say Tim Geithner also got the memo), then the potential fallout would be staggering once this information makes the light of day….
“This wholesale manipulation of markets, investors and taxpayers has gone on long enough.”
Bush/Cheney’s war is also Obama’s war
On March 27, 2009, Obama launched his “new strategy for Afghanistan”. This new strategy is a continuation and expansion of the Bush/Cheney war plan, hatched in the wake of the false flag operation of 9/11, utilizing the identical “war on terrorism” and 9/11 lies as justification.
As articulated by Obama:
“I want the American people to understand that we have a clear and focused goal: to disrupt, dismantle and defeat Al-Qaeda in Pakistan and Afghanistan and to prevent their return to either country in the future. That is a cause that could not be more just.
“I remind everybody, the United States did not choose to fight a war in Afghanistan. Nearly 3,000 of our people were killed on Sept. 11, 2001, for doing nothing more than going about their daily lives.”
The consensus "Al-Qaeda" deception is not only alive and well under Obama, it is now the justification for a surge of 21,000 US troops into Afghanistan, massive covert operations throughout Central Asia and the Middle East, and an even more aggressive “war on terrorism”. This is the conquest of the “Grand Chessboard” that the Anglo-American elites wanted to execute after 9/11, but “squandered” due to the Bush/Cheney administration’s “fumble” in Iraq.
Obama, who is making the rounds with the G-20 leadership as this report goes to press, will not fumble with a war that is consistent with the “war on terrorism” goals that he has articulated for years, and promised to deliver (to his New World Order “bosses”) throughout his campaign.
As detailed by Michel Chossudovsky in “The Democrats endorse the "Global War on Terrorism": Obama "goes after Osama”, the Obama promise is more perpetual war:
“9/11 constitutes for Obama the main justification for waging a humanitarian war in the Middle East and Central Asia. In this regard, his position does not differ from that of the Bush administration.
“Withdraw from Iraq, but remain in Afghanistan. Confront Iran, challenge Russia…Apart from the rhetoric of ‘bringing the troops home’ from war torn Iraq, which may or may not be carried out, what distinguishes the Democrats from the Republicans?
“A more articulate, knowledgeable and charismatic President?
“A more dignified and diplomatic approach to US foreign policy?
As a pacifying and unifying icon, Obama was positioned to perpetuate the cover-up of the American Empire’s crimes, and retrieve the “squandered opportunity” presented by the false-flag operation of 9/11: a world united behind imperial war.
“An opportunity to the US ruling elite to ‘present a different face to the world that could revive illusions to its democratic pretensions, not only internationally but within the United States as well.’…
“A spurious and counterfeit ‘humanitarian’ approach to Empire, which serves to mask the truth and gain popular support.
“A less reckless Commander in Chief, who has an understanding of geopolitics and is capable of taking foreign policy decisions. A more carefully thought out military agenda than that experienced during the Bush administration? But no substantive shift in direction.
“A means to quelling mounting dissent and opposition to the ruling corporate establishment by providing the illusion that the Democrats constitute a Real Alternative.
“A means to sustaining the illusion that African-Americans can move up the social ladder in America and that their fundamental rights are being upheld.
“A means to undermining real progressive movements by further embedding civil society organizations, trade unions and grass roots organizations, not to mention “Leftist” intellectuals into the realm of the Democratic Party.
“A distraction from the extensive war crimes committed under successive US administrations.
“A ‘human face’ to war and globalization?”
A call to resist As this writer warned in “Obama: return to elite status quo”, written shortly following Obama’s victory:
“…the arrival of Obama as the new imperial figurehead of the Anglo-American empire is not a victory of, or for, the people. It will not signify a dramatic upheaval, in any way, and by no means is any sort of revolution at hand. This election was a necessary rotation of management, scripted at the highest levels of the Anglo-American elite.
“The “change” that a Barack Obama presidency will bring to America and the world will be one of style, not substance: a return to the centrist corporate globalism of the Clinton and Carter eras, complete with regurgitated Democratic Party elites from those administrations, and new neoliberal politicians touting similar ideologies.
“…The velvet gloves will be slipped back over the iron fists, but the fists will still be wielded aggressively. Within months, the global conquest that Bush-Cheney started will resume under the vastly more convincing and adored Obama, who has consistently stated his intention to intensify the war in Afghanistan, and “kill ‘terrorists’” across the Middle East.”
For those who have spent the past eight hellish years opposing and resisting the crimes of Bush/Cheney, prepare yourselves for worse: the “friendliest” fascism, and the most dangerous stealth messenger in history.
The Smooth Criminal Transition from Bush/Cheney to Obama
Corrupt new administration deepens and expands systemic criminalization and war agenda
To sober, clear-eyed observers of history and political deception, the ascension of Barack Obama held the promise for unprecedented new dangers: a revitalized New World Order, led by the Anglo-American empire’s neoliberal criminal faction and an iconic, deceptive new facilitator; and a continuation of Bush/Cheney criminality and war, under smarter and much more effective management.
Now, just months into their tenure, the Barack Obama administration has more than fulfilled the murderous promises he made to his elite constituency, deepening the mass destruction of Bush/Cheney, while charming its victims all over the world into enjoying their own demise.
The empire’s facilitator
Beneath his seemingly boundless charisma and charm, Barack Obama has always been an utterly ruthless politician. He has been a compromiser who has danced with the darkest forces of political and criminal power, while winning over common people; a consensus-abiding chameleon and a “pragmatist”. Obama is the true model of what George W. Bush only claimed to be: “a uniter, not a divider”.
The signs were clear from the early days of the presidential contest that Obama was, like every presidential candidate, a handpicked puppet. His cadre of national security and foreign policy advisors included the most notorious war criminals, intelligence/security “advisors” and corrupt think tank assets in the world. His campaign was bankrolled by Wall Street, and big corporations. His policy agenda was taken from the playbook of the Bilderberg Group, the Council on Foreign Relations and the Trilateral Commission. Both neoliberal (and neocon) elite power and money coalesced behind Obama, as his political rivals dropped off.
Obama’s record in the US Senate was one of general complicity with Bush/Cheney and the status quo, including enthusiastic support of the consensus "war on terrorism" deception and the big 9/11 lie. Former US congresswoman Cynthia McKinney has described how, in her encounters with Obama, the senator from Illinois repeatedly refused to act in opposition to Bush/Cheney policies. Time again, during his days in the Senate, and throughout the presidential campaign, Obama has not only fully supported the Bush/Cheney administration on the Patriot Act, and the wholesale the militarization and criminalization of the United States.
Immediate destabilization
The naïve, the hopeful and the ignorant have continued to harbor fantasies about “change”, even as Obama promptly destroyed every single hope, starting with the composition of his administration. He hand picked a transition team, and then a cabinet consisting entirely of legendary war criminals and corrupt elites, each more malodorous and corrupt than the next. From Iran-Contra participant Robert Gates and war criminal Richard Holbrooke, to Hillary Clinton and an economic advisory team comprised of the architects of Wall Street destruction, including Paul Volcker, Robert Rubin, Larry Summers, and new Treasury Secretary Timothy Geithner.
Under Geithner and Federal Reserve chairman Ben Bernanke, the Ponzi scheme that is Wall Street, the wholesale robbery of the American people begun by Alan Greenspan, Bernanke, and Bush/Cheney Treasury Secretary Hank Paulson has not only continued unabated, but has metastasized with each new bailout, and every new fraud orchestrated by Geithner.
While the people on “Main Street” have continued to suffer a new Great Depression without real assistance from the Obama administration, the New World Order’s financial coffers continue to fill with stolen US taxpayer money. No relief for the impoverished, while the administration “bails out” banks and Wall Street, under such frauds as the "Public Private Partnership Program". Leaving the wolves in charge of the financial henhouse, Geithner and the Obama administration authorized Congress to toss out securities pricing standards on “toxic assets”. (Also see this op-ed, and the piece by Arthur Leavitt, former head of the SEC, and the Carlyle Group.) Essentially, the Obama administration is simply going to let the banks and financial institutions, that created the crisis with their massive Ponzi schemes, determine how they wish to price their own “toxic assets”.
This move, not surprisingly, sparked a huge Wall Street rally. Some even hailed it as the end of the crisis.
A criminal stimulus plan
Obama’s so-called stimulus package is yet another Trojan horse. As exhaustively and incisively detailed by Michel Chossudovsky in “America's Fiscal Collapse”:
“This is a ‘War Budget’. The austerity measures hit all major federal spending programs with the exception of: 1. Defence and the Middle East War: 2. the Wall Street bank bailout, 3. Interest payments on a staggering public debt.
“The Obama stimulus program constitutes a continuation of the Bush administration's bank bailout packages. The proposed policy solution to the crisis becomes the cause, ultimately resulting in further real economy bankruptcies and a corresponding collapse of the standard of living of Americans.
“Both the Bush and Obama bank bailouts are intended to come to the rescue of troubled financial institutions, to ensure the payment of ‘inter-bank’ debt operations. In practice, large amounts of money transit through the banking system, from the banks to the hedge funds, to offshore banking havens and back to the banks.
“What we are dealing with is the fraudulent transfer and confiscation of lifelong savings and pension funds, the fraudulent appropriation of tax revenues to finance the bank bailouts, etc. To understand what has happened: follow the money trail of electronic transfers with a view to establishing where the money has gone.
“What is at stake is the outright criminalization of the financial system: ‘financial theft’ on an unprecedented scale........
........A report by Tyler Durden, citing an anonymous insider trader involved with AIG trades, reveals that manipulation fraudulently transferred US taxpayer money to AIG’s counter-parties---the top banks and financial institutions---with AIG as the “pass-through”. The profit report sparked a market rally that comes at the expense of US taxpayers.
The complete report (thanks to Jenna and the Mike Ruppert Blogspot for this find) is damning and startling:
Exclusive: Big Banks' Recent Profitability Due to AIG Scam?
Excerpt:
“AIG, knowing it would need to ask for more capital from Treasury imminently, decided to throw in the towel, and gifted major bank counter-parties with trades which were egregiously profitable to the banks, and even more egregiously money-losing to the U.S. taxpapers, who had to dump more and more cash into AIG, without having the U.S. Treasury Secretary Tim Geithner disclose the real extent of this---for lack of a better word---fraudulent scam.
“…What this all means is that the statements by major banks, i.e. JP Morgan Chase, Citi, and BofA regarding abnormal profitability in January and February were true, however these profits were a) one-time in nature due to wholesale unwinds of AIG portfolios, b)entirely at the expense of AIG, and thus taxpayers, c) executed with Tim Geithner’s (and thus the administration’s) full knowledge and intent, d) were basically a transfer of money from taxpayers to banks (in yet another form) using AIG as an intermediary [my emphasis-LC].
“For banks to proclaim their profitability in January and February is about as close to criminal hypocrisy as is possible. And again, the taxpayers fund this “one time profit”, which causes a market rally, thus allowing the banks to promptly turn around and start selling more expensive equity…also funded by taxpayers’ money flows into the market. If the administration is truly aware of these events (and if Zero Hedge [the name of the author-LC] knows about it, it is safe to say Tim Geithner also got the memo), then the potential fallout would be staggering once this information makes the light of day….
“This wholesale manipulation of markets, investors and taxpayers has gone on long enough.”
Bush/Cheney’s war is also Obama’s war
On March 27, 2009, Obama launched his “new strategy for Afghanistan”. This new strategy is a continuation and expansion of the Bush/Cheney war plan, hatched in the wake of the false flag operation of 9/11, utilizing the identical “war on terrorism” and 9/11 lies as justification.
As articulated by Obama:
“I want the American people to understand that we have a clear and focused goal: to disrupt, dismantle and defeat Al-Qaeda in Pakistan and Afghanistan and to prevent their return to either country in the future. That is a cause that could not be more just.
“I remind everybody, the United States did not choose to fight a war in Afghanistan. Nearly 3,000 of our people were killed on Sept. 11, 2001, for doing nothing more than going about their daily lives.”
The consensus "Al-Qaeda" deception is not only alive and well under Obama, it is now the justification for a surge of 21,000 US troops into Afghanistan, massive covert operations throughout Central Asia and the Middle East, and an even more aggressive “war on terrorism”. This is the conquest of the “Grand Chessboard” that the Anglo-American elites wanted to execute after 9/11, but “squandered” due to the Bush/Cheney administration’s “fumble” in Iraq.
Obama, who is making the rounds with the G-20 leadership as this report goes to press, will not fumble with a war that is consistent with the “war on terrorism” goals that he has articulated for years, and promised to deliver (to his New World Order “bosses”) throughout his campaign.
As detailed by Michel Chossudovsky in “The Democrats endorse the "Global War on Terrorism": Obama "goes after Osama”, the Obama promise is more perpetual war:
“9/11 constitutes for Obama the main justification for waging a humanitarian war in the Middle East and Central Asia. In this regard, his position does not differ from that of the Bush administration.
“Withdraw from Iraq, but remain in Afghanistan. Confront Iran, challenge Russia…Apart from the rhetoric of ‘bringing the troops home’ from war torn Iraq, which may or may not be carried out, what distinguishes the Democrats from the Republicans?
“A more articulate, knowledgeable and charismatic President?
“A more dignified and diplomatic approach to US foreign policy?
As a pacifying and unifying icon, Obama was positioned to perpetuate the cover-up of the American Empire’s crimes, and retrieve the “squandered opportunity” presented by the false-flag operation of 9/11: a world united behind imperial war.
“An opportunity to the US ruling elite to ‘present a different face to the world that could revive illusions to its democratic pretensions, not only internationally but within the United States as well.’…
“A spurious and counterfeit ‘humanitarian’ approach to Empire, which serves to mask the truth and gain popular support.
“A less reckless Commander in Chief, who has an understanding of geopolitics and is capable of taking foreign policy decisions. A more carefully thought out military agenda than that experienced during the Bush administration? But no substantive shift in direction.
“A means to quelling mounting dissent and opposition to the ruling corporate establishment by providing the illusion that the Democrats constitute a Real Alternative.
“A means to sustaining the illusion that African-Americans can move up the social ladder in America and that their fundamental rights are being upheld.
“A means to undermining real progressive movements by further embedding civil society organizations, trade unions and grass roots organizations, not to mention “Leftist” intellectuals into the realm of the Democratic Party.
“A distraction from the extensive war crimes committed under successive US administrations.
“A ‘human face’ to war and globalization?”
A call to resist As this writer warned in “Obama: return to elite status quo”, written shortly following Obama’s victory:
“…the arrival of Obama as the new imperial figurehead of the Anglo-American empire is not a victory of, or for, the people. It will not signify a dramatic upheaval, in any way, and by no means is any sort of revolution at hand. This election was a necessary rotation of management, scripted at the highest levels of the Anglo-American elite.
“The “change” that a Barack Obama presidency will bring to America and the world will be one of style, not substance: a return to the centrist corporate globalism of the Clinton and Carter eras, complete with regurgitated Democratic Party elites from those administrations, and new neoliberal politicians touting similar ideologies.
“…The velvet gloves will be slipped back over the iron fists, but the fists will still be wielded aggressively. Within months, the global conquest that Bush-Cheney started will resume under the vastly more convincing and adored Obama, who has consistently stated his intention to intensify the war in Afghanistan, and “kill ‘terrorists’” across the Middle East.”
For those who have spent the past eight hellish years opposing and resisting the crimes of Bush/Cheney, prepare yourselves for worse: the “friendliest” fascism, and the most dangerous stealth messenger in history.
SC92-1
http://www.globalresearch.ca/index.php?context=va&aid=13612
The Secrets of the Federal Reserve
The Federal Reserve Act was legislated in 1913 to end recessions, panics and depression. Over that almost 100-year period they have been eminently no more successful then their predecessors. The Fed is a private corporation, which guides US monetary policy. Its staff is from Wall Street, banking, and transnational conglomerates and occasionally from academia. Of the 12 Federal Reserve banks the New York bank is the most powerful. The staffing of the Fed at the least is incestuous, because the member banks take part in the staffing, as they filter to the Fed what actions they should take. That is done by the FOMC, The Federal Open Market Committee. As a further example the recent stress test done by the Fed was done on many of their owners. Sadly the public is unaware of this and even business majors and those with business masters degrees do not know that the Fed is privately owned or what they actually do. For those of you who would like to get a better understanding read G. Edward Griffith’s, “Creature from Jekyll Island” and the secrets of the Federal Reserve” by Eustace Mullins.
Recently we discovered that $101.4 billion was originally secretly funneled through AIG to AIG counterparties - parties that were owed these sums by AIG, which had not collateralized derivative contracts. That is like writing insurance and having no collateral reserves set aside for losing events. The Federal Reserve in their wisdom paid off AIG’s debt with what eventually will be taxpayer debt. This is wrong and it should not have been done secretly. When demanded by a Federal Judge to reveal to whom these monies were paid and under what circumstances, the Fed said it would harm their reputations and it was a “state secret.”
The biggest gun in the Fed arsenal is the New York Fed. The recently appointed Secretary of the Treasury Timothy Geithner was the NY Fed’s previous governor. Mr. Geithner had worked in government previously and was in part responsible for the Asian financial disaster in 1997-1998. He is also a Goldman Sachs alumnus. He is part of a never-ending exchange of the denizens of Wall Street and banking being appointed to government positions. In fact Wall Street and banking have been running our government for a long time. Many say for too long.
This kind of relationship makes government a tool of major financial interests and it breeds corruption, as we just witnessed in the case of Stephen Friedman, formerly of Goldman Sachs, and until he resigned last week, for having purchased some Goldman Sachs stock, was Chairman of the NY federal Reserve, the position Mr. Geithner had held before him. This raises the fundamental question of appointment and corruption. Never mind the other issues the Fed is involved in. this is America’s most powerful financial institution and it is run by corrupt and perhaps incompetent people. The NY fed has a very special position, because it is actively running markets every day via the 21 dealers it uses to manipulate and uses these markets. This is part of the program never spoken of that exists to assist the “Working Group on Financial Markets, which manipulates markets 24/7, under an Executive Order signed in August 1988 by then President Ronald Reagan. This was executed to protect against market failures such that had taken place the previous October. The order was for emergencies. The Treasury, the Fed, Wall Street and banking have distorted its original intent. The Fed also sets interest rates and regulates the issuance of money and credit. Thus the Fed holds a pivotal role in our financial well-being. They also are to insure the soundness and stability of the banking system. If our banking system breaks down it is the fault of the Fed. When that happens it should not be the province of the Fed to commit trillions of dollars of taxpayer money to bail out its own owners.
You can get an idea of the incestuous nature of the Fed and Wall Street in looking at the select committee that not that long ago picked Timothy Geithner to head the NY Fed. Hank Greenberg defrocked former Chairman of AIG, who for some reason was never criminally prosecuted in the scandal; John Whitehead a former Chairman of Goldman Sachs; Peter Peterson, a former Chairman of Lehman Bros.; and Walter Shipley, a former Chairman of Chase Manhattan, now with JP Morgan Chase. We wonder why the media never questions these kinds of connections all of which are tied together by the Council on Foreign Relations............
.......This means the Fed’s real consideration is the maximizing of profits for banking, Wall Street, insurance and real estate. This goal of almost 100 years has made these individuals and their families’ mega-rich. Competent or incompetent they always win. They have information and intelligence no one else has and you can be sure their inner circle has the same privileged information. As usual they are essentially unregulated, which gives the Fed an additional advantage. The lack of banking oversight of recent years has brought our entire financial system into insolvency. We do not know how you could call it anything else when most major banks, brokerage houses, some insurance companies and other lenders are simply broke. The Fed, and particularly the NY Fed, has been complicit in banks and brokerage houses using leverage of more than 50 times assets. In some cases such as JP Morgan Chase the figures are much higher. In fractional banking 8 to 10 times is considered appropriate. This is the biggest bailout of poorly managed corrupt banks in history. This failure is far greater than the failure of the Lombard System in Venice in 1348, the year of the great bubonic plague that swept Europe and killed 50% of its inhabitants. These elitists have brought the world economy to its knees. It is ironic, but true to insider dealing, that not one CEO or senior executive has been fired, as trillions of dollars have been lost.......
........The economics of monetarism are nothing more than a formula promulgated to save the financial sector and not the country, by using an elitist trickle down theory, which as recent as the 1980s had been proven unworkable. Bail out the rich on Wall Street, the bankers and insurance companies and let the poor and working poor fend for themselves. This is class economics and this is what turns the masses toward socialism. Bankers, who caused the problem, are bailed out by the masses, and the public is left to drown on their own. We are told the bankers and Wall Street must be saved or we’ll have no economy. We call this the myth of saving the criminals.
Under a Federal Reserve System the Fed has in private hands unlimited state power to create money and credit backed by the full faith and credit of the American people, which denies those people the rights of sovereignty.
Via the Fed and via Executive Order and the “Working Group on Financial Markets” we allow the Fed and the Treasury to manipulate our markets. Thus our financial elite grow richer and richer, and worse yet even professionals do not know what is going on, never mind the public. The creation of money and credit is effected in such a way that the financial sector is protected and the burden of loss of purchasing power is cast upon American workers. The capitalists do business as usual. Such pursuits have often ended in revolution. The fruits of low wages in America, a result of free trade, globalization, offshoring and outsourcing, have taken their toll. The result is more than two years of recession and now more than three months of depression. The working poor cannot afford to buy what they produce and they cannot pay the debt cast upon them by Wall Street and the banking establishment. There are no free markets. The markets are what these people want them to be. Today they feed their own debt bubble hoping, hope against hope they can bail out the system again.
These miscreatants, in what is called a shadow banking system securitized mortgages and other debt by fraud via a corrupt rating system worldwide monetizing their liabilities and buried thousands of professionals worldwide. This unpayable debt, now lost, along with derivatives present problems that are really just beginning to be addressed. All this is done with little transparency in order for these institutions, guided by the Fed, to dump their financial risks.
There you have it. A manmade disaster created by the Federal Reserve, banking and Wall Street, and these are the same corrupt group who our government has chosen to rectify the problem. Their answer is to take the funds from the public to cover their losses, be it by inflation or taxes. The answer is get rid of the Fed and purge the system once and for all.
The Secrets of the Federal Reserve
The Federal Reserve Act was legislated in 1913 to end recessions, panics and depression. Over that almost 100-year period they have been eminently no more successful then their predecessors. The Fed is a private corporation, which guides US monetary policy. Its staff is from Wall Street, banking, and transnational conglomerates and occasionally from academia. Of the 12 Federal Reserve banks the New York bank is the most powerful. The staffing of the Fed at the least is incestuous, because the member banks take part in the staffing, as they filter to the Fed what actions they should take. That is done by the FOMC, The Federal Open Market Committee. As a further example the recent stress test done by the Fed was done on many of their owners. Sadly the public is unaware of this and even business majors and those with business masters degrees do not know that the Fed is privately owned or what they actually do. For those of you who would like to get a better understanding read G. Edward Griffith’s, “Creature from Jekyll Island” and the secrets of the Federal Reserve” by Eustace Mullins.
Recently we discovered that $101.4 billion was originally secretly funneled through AIG to AIG counterparties - parties that were owed these sums by AIG, which had not collateralized derivative contracts. That is like writing insurance and having no collateral reserves set aside for losing events. The Federal Reserve in their wisdom paid off AIG’s debt with what eventually will be taxpayer debt. This is wrong and it should not have been done secretly. When demanded by a Federal Judge to reveal to whom these monies were paid and under what circumstances, the Fed said it would harm their reputations and it was a “state secret.”
The biggest gun in the Fed arsenal is the New York Fed. The recently appointed Secretary of the Treasury Timothy Geithner was the NY Fed’s previous governor. Mr. Geithner had worked in government previously and was in part responsible for the Asian financial disaster in 1997-1998. He is also a Goldman Sachs alumnus. He is part of a never-ending exchange of the denizens of Wall Street and banking being appointed to government positions. In fact Wall Street and banking have been running our government for a long time. Many say for too long.
This kind of relationship makes government a tool of major financial interests and it breeds corruption, as we just witnessed in the case of Stephen Friedman, formerly of Goldman Sachs, and until he resigned last week, for having purchased some Goldman Sachs stock, was Chairman of the NY federal Reserve, the position Mr. Geithner had held before him. This raises the fundamental question of appointment and corruption. Never mind the other issues the Fed is involved in. this is America’s most powerful financial institution and it is run by corrupt and perhaps incompetent people. The NY fed has a very special position, because it is actively running markets every day via the 21 dealers it uses to manipulate and uses these markets. This is part of the program never spoken of that exists to assist the “Working Group on Financial Markets, which manipulates markets 24/7, under an Executive Order signed in August 1988 by then President Ronald Reagan. This was executed to protect against market failures such that had taken place the previous October. The order was for emergencies. The Treasury, the Fed, Wall Street and banking have distorted its original intent. The Fed also sets interest rates and regulates the issuance of money and credit. Thus the Fed holds a pivotal role in our financial well-being. They also are to insure the soundness and stability of the banking system. If our banking system breaks down it is the fault of the Fed. When that happens it should not be the province of the Fed to commit trillions of dollars of taxpayer money to bail out its own owners.
You can get an idea of the incestuous nature of the Fed and Wall Street in looking at the select committee that not that long ago picked Timothy Geithner to head the NY Fed. Hank Greenberg defrocked former Chairman of AIG, who for some reason was never criminally prosecuted in the scandal; John Whitehead a former Chairman of Goldman Sachs; Peter Peterson, a former Chairman of Lehman Bros.; and Walter Shipley, a former Chairman of Chase Manhattan, now with JP Morgan Chase. We wonder why the media never questions these kinds of connections all of which are tied together by the Council on Foreign Relations............
.......This means the Fed’s real consideration is the maximizing of profits for banking, Wall Street, insurance and real estate. This goal of almost 100 years has made these individuals and their families’ mega-rich. Competent or incompetent they always win. They have information and intelligence no one else has and you can be sure their inner circle has the same privileged information. As usual they are essentially unregulated, which gives the Fed an additional advantage. The lack of banking oversight of recent years has brought our entire financial system into insolvency. We do not know how you could call it anything else when most major banks, brokerage houses, some insurance companies and other lenders are simply broke. The Fed, and particularly the NY Fed, has been complicit in banks and brokerage houses using leverage of more than 50 times assets. In some cases such as JP Morgan Chase the figures are much higher. In fractional banking 8 to 10 times is considered appropriate. This is the biggest bailout of poorly managed corrupt banks in history. This failure is far greater than the failure of the Lombard System in Venice in 1348, the year of the great bubonic plague that swept Europe and killed 50% of its inhabitants. These elitists have brought the world economy to its knees. It is ironic, but true to insider dealing, that not one CEO or senior executive has been fired, as trillions of dollars have been lost.......
........The economics of monetarism are nothing more than a formula promulgated to save the financial sector and not the country, by using an elitist trickle down theory, which as recent as the 1980s had been proven unworkable. Bail out the rich on Wall Street, the bankers and insurance companies and let the poor and working poor fend for themselves. This is class economics and this is what turns the masses toward socialism. Bankers, who caused the problem, are bailed out by the masses, and the public is left to drown on their own. We are told the bankers and Wall Street must be saved or we’ll have no economy. We call this the myth of saving the criminals.
Under a Federal Reserve System the Fed has in private hands unlimited state power to create money and credit backed by the full faith and credit of the American people, which denies those people the rights of sovereignty.
Via the Fed and via Executive Order and the “Working Group on Financial Markets” we allow the Fed and the Treasury to manipulate our markets. Thus our financial elite grow richer and richer, and worse yet even professionals do not know what is going on, never mind the public. The creation of money and credit is effected in such a way that the financial sector is protected and the burden of loss of purchasing power is cast upon American workers. The capitalists do business as usual. Such pursuits have often ended in revolution. The fruits of low wages in America, a result of free trade, globalization, offshoring and outsourcing, have taken their toll. The result is more than two years of recession and now more than three months of depression. The working poor cannot afford to buy what they produce and they cannot pay the debt cast upon them by Wall Street and the banking establishment. There are no free markets. The markets are what these people want them to be. Today they feed their own debt bubble hoping, hope against hope they can bail out the system again.
These miscreatants, in what is called a shadow banking system securitized mortgages and other debt by fraud via a corrupt rating system worldwide monetizing their liabilities and buried thousands of professionals worldwide. This unpayable debt, now lost, along with derivatives present problems that are really just beginning to be addressed. All this is done with little transparency in order for these institutions, guided by the Fed, to dump their financial risks.
There you have it. A manmade disaster created by the Federal Reserve, banking and Wall Street, and these are the same corrupt group who our government has chosen to rectify the problem. Their answer is to take the funds from the public to cover their losses, be it by inflation or taxes. The answer is get rid of the Fed and purge the system once and for all.
Friday, May 29, 2009
SC91-15
http://www.globalresearch.ca/index.php?context=va&aid=13773
Manipulation: How Financial Markets Really Work
Wall Street's mantra is that markets move randomly and reflect the collective wisdom of investors. The truth is quite opposite. The government's visible hand and insiders control markets and manipulate them up or down for profit - all of them, including stocks, bonds, commodities and currencies.
It's financial fraud or what former high-level Wall Street insider and former Assistant HUD Secretary Catherine Austin Fitts calls "pump and dump," defined as "artificially inflating the price of a stock or other security through promotion, in order to sell at the inflated price," then profit more on the downside by short-selling. "This practice is illegal under securities law, yet it is particularly common," and in today's volatile markets likely ongoing daily.
Why? Because the profits are enormous, in good and bad times, and when carried to extremes like now, Fitts calls it "pump(ing) and dump(ing) of the entire American economy," duping the public, fleecing trillions from them, and it's more than just "a process designed to wipe out the middle class. This is genocide (by other means) - a much more subtle and lethal version than ever before perpetrated by the scoundrels of our history texts."
Fitts explains that much more than market manipulation goes on. She describes a "financial coup d'etat, including fraudulent housing (and other bubbles), pump and dump schemes, naked short selling, precious metals price suppression, and active intervention in the markets by the government and central bank" along with insiders. It's a government-business partnership for enormous profits through "legislation, contracts, regulation (or lack of it), financing, (and) subsidies." More still overall by rigging the game for the powerful, while at the same time harming the public so cleverly that few understand what's happening......
.......In fact, the "private sector" creates "financial shocks" to open markets, remove competition, and consolidate for greater power by buying damaged assets cheap. Financial history has numerous examples of preying on the weak, crushing competition, socializing risks, privatizing profits, redistributing wealth upward to a financial oligarchy, creating "tollbooth economies" in debt bondage according to Michael Hudson, and overall getting a "free lunch" at the public's expense.....
......Michel Chossudovsky explains that: "triggering market collapse(s) can be a very profitable undertaking. (Evidence suggests) that the Security and Exchange Commission (SEC) regulators have created an environment which supports speculative transactions (through) futures, options, index funds, derivative securities (and short-selling), etc. (that) make money when the stock market crumbles....foreknowledge and inside information (create golden profit opportunities for) powerful speculators" able to move markets up or down with the public none the wiser.
As a result, concentrated wealth and "financial power resulting from market manipulation is unprecedented" with small investors' savings, IRAs, pensions, 401ks, and futures being decimated from it........
Manipulation: How Financial Markets Really Work
Wall Street's mantra is that markets move randomly and reflect the collective wisdom of investors. The truth is quite opposite. The government's visible hand and insiders control markets and manipulate them up or down for profit - all of them, including stocks, bonds, commodities and currencies.
It's financial fraud or what former high-level Wall Street insider and former Assistant HUD Secretary Catherine Austin Fitts calls "pump and dump," defined as "artificially inflating the price of a stock or other security through promotion, in order to sell at the inflated price," then profit more on the downside by short-selling. "This practice is illegal under securities law, yet it is particularly common," and in today's volatile markets likely ongoing daily.
Why? Because the profits are enormous, in good and bad times, and when carried to extremes like now, Fitts calls it "pump(ing) and dump(ing) of the entire American economy," duping the public, fleecing trillions from them, and it's more than just "a process designed to wipe out the middle class. This is genocide (by other means) - a much more subtle and lethal version than ever before perpetrated by the scoundrels of our history texts."
Fitts explains that much more than market manipulation goes on. She describes a "financial coup d'etat, including fraudulent housing (and other bubbles), pump and dump schemes, naked short selling, precious metals price suppression, and active intervention in the markets by the government and central bank" along with insiders. It's a government-business partnership for enormous profits through "legislation, contracts, regulation (or lack of it), financing, (and) subsidies." More still overall by rigging the game for the powerful, while at the same time harming the public so cleverly that few understand what's happening......
.......In fact, the "private sector" creates "financial shocks" to open markets, remove competition, and consolidate for greater power by buying damaged assets cheap. Financial history has numerous examples of preying on the weak, crushing competition, socializing risks, privatizing profits, redistributing wealth upward to a financial oligarchy, creating "tollbooth economies" in debt bondage according to Michael Hudson, and overall getting a "free lunch" at the public's expense.....
......Michel Chossudovsky explains that: "triggering market collapse(s) can be a very profitable undertaking. (Evidence suggests) that the Security and Exchange Commission (SEC) regulators have created an environment which supports speculative transactions (through) futures, options, index funds, derivative securities (and short-selling), etc. (that) make money when the stock market crumbles....foreknowledge and inside information (create golden profit opportunities for) powerful speculators" able to move markets up or down with the public none the wiser.
As a result, concentrated wealth and "financial power resulting from market manipulation is unprecedented" with small investors' savings, IRAs, pensions, 401ks, and futures being decimated from it........
SC91-14
http://informationclearinghouse.info/article22726.htm
Who will Stand Up To America and Israel?
“Obama Calls on World to ‘Stand Up To’ North Korea” read the headline. The United States, Obama said, was determined to protect “the peace and security of the world.”
Shades of doublespeak, doublethink, 1984.
North Korea is a small place. China alone could snuff it out in a few minutes. Yet, the president of the US thinks that nothing less than the entire world is a match for North Korea.
We are witnessing the Washington gangsters construct yet another threat like Slobodan Milosevic, Osama bin Laden, Saddam Hussein, John Walker Lindh, Hamdi, Padilla, Sami Al-Arian, Hamas, Mahkmoud Ahmadinejad, and the hapless detainees demonized by the US Secretary of Defense Rumsfeld as “the 700 most dangerous terrorists on the face of the earth,” who were tortured for six years at Gitmo only to be quietly released. Just another mistake, sorry.
The military/security complex that rules America, together with the Israel Lobby and the financial banksters, needs a long list of dangerous enemies to keep the taxpayers’ money flowing into its coffers.
The Homeland Security lobby is dependent on endless threats to convince Americans that they must forego civil liberty in order to be safe and secure.
The real question is who is going to stand up to the American and Israeli governments?
Who is going to protect Americans’ and Israelis’ civil liberties, especially those of Israeli dissenters and Israel’s Arab citizens?
Who is going to protect Palestinians, Iraqis, Afghans, Lebanese, Iranians, and Syrians from Americans and Israelis?
Not Obama, and not the right-wing brownshirts that today rule Israel.
Obama’s notion that it takes the entire world to stand up to N. Korea is mind-boggling, but this mind-boggling idea pales in comparison to Obama’s guarantee that America will protect “the peace and security of the world.”
Is this the same America that bombed Serbia, including Chinese diplomatic offices and civilian passenger trains, and pried Kosovo loose from Serbia and gave it to a gang of Muslin drug lords, lending them NATO troops to protect their operation?
Is this the same America that is responsible for approximately one million dead Iraqis, leaving orphans and widows everywhere and making refugees out of one-firth of the Iraqi population?
Is this the same America that blocked the rest of the world from condemning Israel for its murderous attack on Lebanese civilians in 2006 and on Gazans most recently, the same America that has covered up for Israel’s theft of Palestine over the past 60 years, a theft that has produced four million Palestinian refugees driven by Israeli violence and terror from their homes and villages?
Is this the same America that is conducting military exercises in former constituent parts of Russia and ringing Russia with missile bases?
Is this the same America that has bombed Afghanistan into rubble with massive civilian casualties?
Is this the same America that has started a horrific new war in Pakistan, a war that in its first few days has produced one million refugees?
“The peace and security of the world”? Whose world?
On his return from his consultation with Obama in Washington, the brownshirted Israeli prime minister Benjamin Netanyahu declared that it was Israel’s responsibility to “eliminate” the “nuclear threat” from Iran.
What nuclear threat? The US intelligence agencies are unanimous in their conclusion that Iran has had no nuclear weapons program since 2003. The inspectors of the International Atomic Energy Agency report that there is no sign of a nuclear weapons program in Iran.
Who is Iran bombing? How many refugees is Iran sending fleeing for their lives?
Who is North Korea bombing?
The two great murderous, refugee-producing countries are the US and Israel. Between them, they have murdered and dislocated millions of people who were a threat to no one.
No countries on earth rival the US and Israel for barbaric murderous violence.
But Obama gives assurances that the US will protect “the peace and security of the world.” And the brownshirt Netanyahu assures the world that Israel will save it from the “Iranian threat.”
Where is the media?
Why aren’t people laughing their heads off?
Who will Stand Up To America and Israel?
“Obama Calls on World to ‘Stand Up To’ North Korea” read the headline. The United States, Obama said, was determined to protect “the peace and security of the world.”
Shades of doublespeak, doublethink, 1984.
North Korea is a small place. China alone could snuff it out in a few minutes. Yet, the president of the US thinks that nothing less than the entire world is a match for North Korea.
We are witnessing the Washington gangsters construct yet another threat like Slobodan Milosevic, Osama bin Laden, Saddam Hussein, John Walker Lindh, Hamdi, Padilla, Sami Al-Arian, Hamas, Mahkmoud Ahmadinejad, and the hapless detainees demonized by the US Secretary of Defense Rumsfeld as “the 700 most dangerous terrorists on the face of the earth,” who were tortured for six years at Gitmo only to be quietly released. Just another mistake, sorry.
The military/security complex that rules America, together with the Israel Lobby and the financial banksters, needs a long list of dangerous enemies to keep the taxpayers’ money flowing into its coffers.
The Homeland Security lobby is dependent on endless threats to convince Americans that they must forego civil liberty in order to be safe and secure.
The real question is who is going to stand up to the American and Israeli governments?
Who is going to protect Americans’ and Israelis’ civil liberties, especially those of Israeli dissenters and Israel’s Arab citizens?
Who is going to protect Palestinians, Iraqis, Afghans, Lebanese, Iranians, and Syrians from Americans and Israelis?
Not Obama, and not the right-wing brownshirts that today rule Israel.
Obama’s notion that it takes the entire world to stand up to N. Korea is mind-boggling, but this mind-boggling idea pales in comparison to Obama’s guarantee that America will protect “the peace and security of the world.”
Is this the same America that bombed Serbia, including Chinese diplomatic offices and civilian passenger trains, and pried Kosovo loose from Serbia and gave it to a gang of Muslin drug lords, lending them NATO troops to protect their operation?
Is this the same America that is responsible for approximately one million dead Iraqis, leaving orphans and widows everywhere and making refugees out of one-firth of the Iraqi population?
Is this the same America that blocked the rest of the world from condemning Israel for its murderous attack on Lebanese civilians in 2006 and on Gazans most recently, the same America that has covered up for Israel’s theft of Palestine over the past 60 years, a theft that has produced four million Palestinian refugees driven by Israeli violence and terror from their homes and villages?
Is this the same America that is conducting military exercises in former constituent parts of Russia and ringing Russia with missile bases?
Is this the same America that has bombed Afghanistan into rubble with massive civilian casualties?
Is this the same America that has started a horrific new war in Pakistan, a war that in its first few days has produced one million refugees?
“The peace and security of the world”? Whose world?
On his return from his consultation with Obama in Washington, the brownshirted Israeli prime minister Benjamin Netanyahu declared that it was Israel’s responsibility to “eliminate” the “nuclear threat” from Iran.
What nuclear threat? The US intelligence agencies are unanimous in their conclusion that Iran has had no nuclear weapons program since 2003. The inspectors of the International Atomic Energy Agency report that there is no sign of a nuclear weapons program in Iran.
Who is Iran bombing? How many refugees is Iran sending fleeing for their lives?
Who is North Korea bombing?
The two great murderous, refugee-producing countries are the US and Israel. Between them, they have murdered and dislocated millions of people who were a threat to no one.
No countries on earth rival the US and Israel for barbaric murderous violence.
But Obama gives assurances that the US will protect “the peace and security of the world.” And the brownshirt Netanyahu assures the world that Israel will save it from the “Iranian threat.”
Where is the media?
Why aren’t people laughing their heads off?
Monday, May 25, 2009
SC91-13
http://jameshowardkunstler.typepad.com/clusterfuck_nation/
Wishes, Hopes, Fantasies
Something like a week remains before General Motors is reduced to lunch meat on industrial-capital's All-You-Can-Eat buffet spread. The wish is that its deconstructed pieces will re-organize into a "lean, mean machine" for producing "cars that Americans want to buy," and that, by extension, the American Dream of a Happy Motoring economy may be extended a while longer.
This fantasy rests on some assumptions that just don't "pencil out." One is that the broad American car-owning public can continue to buy their cars the usual way, on credit. The biggest emerging new class in America is the "former middle class." Credit kept the remnants of the middle class going for decades after their incomes stopped growing in the 1970s. Now, their incomes have stopped coming in altogether and they are sinking into swamp of entropy already occupied by the tattoo-for-lunch-bunch. Of course, this has plenty of dire sociopolitical implications. Unfortunately, the big American banks did their biggest volume business in their biggest loans at the very time that that the middle class was on its way to becoming former. Now that the former middle class is arriving at its destination, the banks are so damaged by bad paper that they won't make loans to even the remnant of the remnant of the middle class. In other words, the entire model for financing Happy Motoring is now out-of-order, probably permanently.
Even assuming some Americans can continue buying cars one way or another, I'm not convinced that we can make the kinds we fantasize about. Notice, nobody talks about hydrogen-powered fuel cell cars anymore. Why not? Because the technicalities and logistics could not be overcome at the scale required -- i.e. at the current scale of mass highway motoring and commuting. Sure, you could build a demonstration vehicle and run it around a test track a few times, but could you build a mass production car by the tens of millions that would run for 150,000 miles without a hugely expensive fuel cell change-out? No, at least not within the time-window that the liquid hydrocarbon fuel problem presented. Or could you construct a hydrogen fuel station (and product delivery) network replacing the old gasoline stations? Fuggeddabowdit. Hydrogen, as an element, was just too hard to move and contain. It's teeny-weeny atoms leaked out of valves and gaskets remorselessly and you couldn't pack enough into a tanker truck to make the trip to its destination worthwhile. Schemes to generate hydrogen on-board all ended up in the "perpetual motion" sink.
The current wish is that the dregs of GM and Chrysler will hire low-paid elves with no pension or health benefits and pump out hybrid and/or electric cars. It's conceivable that we could "reverse-engineer" a Prius or an Insight, but considering what a lousy job American car companies did on reverse-engineering everything that Japan or Germany pumped out over the past thirty-five years, the odds are pretty high that these new products will be just lame enough to fail against the established competition. What's more, they also present logistical and technical problems. For the hybrid, gasoline is still an issue (and Jevon's Paradox comes into play: the more efficient you make a means for using a resource, the more of that resource you will use). For both the hybrid and the electric car, the issue of how to get enough lithium for the batteries obtains, at least for now, given the current state-of-the-art battery technology. Most of this rare metal now comes from one place, Bolivia, and everybody wants "a piece" of it. Electric vehicles in large numbers depend on either coal or nuclear powered electric generation, each presenting special hazards. Both hybrids and electric cars would depend on the old installment loan purchase system -- at least to work in the current mode of suburban living, long-range commuting, and interstate highway travel.
Boone Pickens's plan of last year for converting the US car fleet to natural gas was another fantasy with wide appeal. But it depended on the companion fantasy of building massive wind-farm infrastructure on the great plains to shift natural gas use from power plants to vehicles, and the financial crisis has destroyed the capital necessary to even begin planning that project -- it even destroyed a large part of Mr. Pickens own capital reserves. Anyway, I would not be so sanguine about the long-term future of the shale gas plays that this scheme was based on. The depletion rates of these wells is horrendous and the amount of steel needed to keep production up is not consistent with the realities of the available infrastructure.
All the technologies under consideration are not likely to extend the Happy Motoring era. A prayerful reflection on them can only reinforce the specialness of oil and its byproducts -- cheap oil double-specially -- as well as reinforcing the reality that the cheap energy era itself is over. And, of course, in the play of events over the past several years we can see the relationship between cheap energy and easy credit, and how our entire economy has run aground, one way or another, on resource limits.
The implications of all this in the sociopolitical and geopolitical realms are pretty daunting. As long as we maintain Happy Motoring as the normal mode of existence in this country, we are going to see an ever-growing class of very resentful citizens pissed off at being foreclosed from it. In my oft-repeated scheme-of-things, this leads very quickly to the trap of political extremism, perhaps even corn-pone Naziism, as the system becomes increasingly difficult to prop up except by force. In geopolitical terms it leads to ever more dangerous international contests over the world's remaining oil reserves.
All this leads to two conclusions.
One is to accept the fact that the Happy Motoring era is over and to devote our remaining resources to re-localization, walkable communities, and public transit. It obviously requires a very drastic revision of our current collective self-image, of what we aspire to and who we are. If the car companies have any future at all, it should be based on making the rolling stock for public transit -- and for now the most intelligent choice for us is to fix the existing passenger railroad lines instead of venturing into grandiose new transit systems requiring stupendous capital outlays. Let the car era wind down gracefully. Triage and prioritize the highway maintenance agenda -- we won't be affluent enough to keep repaving the whole existing system -- and let other nations meet the diminishing demand for cars in the USA. This would be a "best case" scenario. (Other nations may decide to go further up the Happy Motoring road at their own eventual peril.)
My second conclusion is not so appetizing, namely that the bankruptcy of General Motors may set in motion a chain of events that will accelerate the destructive unwind of the bad credit economy, the damage to our bond values, the loss of faith in our currency, and the authority and legitimacy of our leaders. This last dire outcome might be allayed if, say, President Obama directed his policy efforts to the items in the paragraph above, that is, a reality-based agenda for true change in how we live -- but who can feel confident about that happening these days? Maybe it will take a horrifying chain of events to get Mr. Obama there. And then, tragically, he may be overwhelmed by the chain of events itself.
I hope not.
Wishes, Hopes, Fantasies
Something like a week remains before General Motors is reduced to lunch meat on industrial-capital's All-You-Can-Eat buffet spread. The wish is that its deconstructed pieces will re-organize into a "lean, mean machine" for producing "cars that Americans want to buy," and that, by extension, the American Dream of a Happy Motoring economy may be extended a while longer.
This fantasy rests on some assumptions that just don't "pencil out." One is that the broad American car-owning public can continue to buy their cars the usual way, on credit. The biggest emerging new class in America is the "former middle class." Credit kept the remnants of the middle class going for decades after their incomes stopped growing in the 1970s. Now, their incomes have stopped coming in altogether and they are sinking into swamp of entropy already occupied by the tattoo-for-lunch-bunch. Of course, this has plenty of dire sociopolitical implications. Unfortunately, the big American banks did their biggest volume business in their biggest loans at the very time that that the middle class was on its way to becoming former. Now that the former middle class is arriving at its destination, the banks are so damaged by bad paper that they won't make loans to even the remnant of the remnant of the middle class. In other words, the entire model for financing Happy Motoring is now out-of-order, probably permanently.
Even assuming some Americans can continue buying cars one way or another, I'm not convinced that we can make the kinds we fantasize about. Notice, nobody talks about hydrogen-powered fuel cell cars anymore. Why not? Because the technicalities and logistics could not be overcome at the scale required -- i.e. at the current scale of mass highway motoring and commuting. Sure, you could build a demonstration vehicle and run it around a test track a few times, but could you build a mass production car by the tens of millions that would run for 150,000 miles without a hugely expensive fuel cell change-out? No, at least not within the time-window that the liquid hydrocarbon fuel problem presented. Or could you construct a hydrogen fuel station (and product delivery) network replacing the old gasoline stations? Fuggeddabowdit. Hydrogen, as an element, was just too hard to move and contain. It's teeny-weeny atoms leaked out of valves and gaskets remorselessly and you couldn't pack enough into a tanker truck to make the trip to its destination worthwhile. Schemes to generate hydrogen on-board all ended up in the "perpetual motion" sink.
The current wish is that the dregs of GM and Chrysler will hire low-paid elves with no pension or health benefits and pump out hybrid and/or electric cars. It's conceivable that we could "reverse-engineer" a Prius or an Insight, but considering what a lousy job American car companies did on reverse-engineering everything that Japan or Germany pumped out over the past thirty-five years, the odds are pretty high that these new products will be just lame enough to fail against the established competition. What's more, they also present logistical and technical problems. For the hybrid, gasoline is still an issue (and Jevon's Paradox comes into play: the more efficient you make a means for using a resource, the more of that resource you will use). For both the hybrid and the electric car, the issue of how to get enough lithium for the batteries obtains, at least for now, given the current state-of-the-art battery technology. Most of this rare metal now comes from one place, Bolivia, and everybody wants "a piece" of it. Electric vehicles in large numbers depend on either coal or nuclear powered electric generation, each presenting special hazards. Both hybrids and electric cars would depend on the old installment loan purchase system -- at least to work in the current mode of suburban living, long-range commuting, and interstate highway travel.
Boone Pickens's plan of last year for converting the US car fleet to natural gas was another fantasy with wide appeal. But it depended on the companion fantasy of building massive wind-farm infrastructure on the great plains to shift natural gas use from power plants to vehicles, and the financial crisis has destroyed the capital necessary to even begin planning that project -- it even destroyed a large part of Mr. Pickens own capital reserves. Anyway, I would not be so sanguine about the long-term future of the shale gas plays that this scheme was based on. The depletion rates of these wells is horrendous and the amount of steel needed to keep production up is not consistent with the realities of the available infrastructure.
All the technologies under consideration are not likely to extend the Happy Motoring era. A prayerful reflection on them can only reinforce the specialness of oil and its byproducts -- cheap oil double-specially -- as well as reinforcing the reality that the cheap energy era itself is over. And, of course, in the play of events over the past several years we can see the relationship between cheap energy and easy credit, and how our entire economy has run aground, one way or another, on resource limits.
The implications of all this in the sociopolitical and geopolitical realms are pretty daunting. As long as we maintain Happy Motoring as the normal mode of existence in this country, we are going to see an ever-growing class of very resentful citizens pissed off at being foreclosed from it. In my oft-repeated scheme-of-things, this leads very quickly to the trap of political extremism, perhaps even corn-pone Naziism, as the system becomes increasingly difficult to prop up except by force. In geopolitical terms it leads to ever more dangerous international contests over the world's remaining oil reserves.
All this leads to two conclusions.
One is to accept the fact that the Happy Motoring era is over and to devote our remaining resources to re-localization, walkable communities, and public transit. It obviously requires a very drastic revision of our current collective self-image, of what we aspire to and who we are. If the car companies have any future at all, it should be based on making the rolling stock for public transit -- and for now the most intelligent choice for us is to fix the existing passenger railroad lines instead of venturing into grandiose new transit systems requiring stupendous capital outlays. Let the car era wind down gracefully. Triage and prioritize the highway maintenance agenda -- we won't be affluent enough to keep repaving the whole existing system -- and let other nations meet the diminishing demand for cars in the USA. This would be a "best case" scenario. (Other nations may decide to go further up the Happy Motoring road at their own eventual peril.)
My second conclusion is not so appetizing, namely that the bankruptcy of General Motors may set in motion a chain of events that will accelerate the destructive unwind of the bad credit economy, the damage to our bond values, the loss of faith in our currency, and the authority and legitimacy of our leaders. This last dire outcome might be allayed if, say, President Obama directed his policy efforts to the items in the paragraph above, that is, a reality-based agenda for true change in how we live -- but who can feel confident about that happening these days? Maybe it will take a horrifying chain of events to get Mr. Obama there. And then, tragically, he may be overwhelmed by the chain of events itself.
I hope not.
Tuesday, May 19, 2009
SC91-12
http://www.informationclearinghouse.info/article22658.htm
U.S. Economy: The Cancer is Still There
How does one restore the Lords of Capital to their former positions as dictators of the U.S. and global economies, while keeping their seats warm as de facto political rulers of the American state? Saving the finance capital oligarchy has emerged as President Obama’s central mission – the guiding focus of his young administration. Obama has found new and myriad ways to go where no American president has ever gone before, in funneling somewhere around $13 trillion of national treasure to the parasitical class that goes by the shorthand, Wall Street.
By March of this year, the federal government and the Federal Reserve had “spent, lent or committed” $12.8 trillion to the banksters, according to the Bloomberg financial news service. That amounts to 90 percent of the Gross Domestic Product of the entire United States economy for last year. Let us put it another way: Mostly under the auspices of Barack Obama’s administration, the value of nearly every good and service produced in the United States in 2008 has been, in one way or another, put at the disposal of a tiny financial oligarchy.
This is the kind of overarching reality that defines, not just presidencies, but eras. In the cold assessment of history, Barack Obama will be remembered more for his massive transfers of national wealth to the finance capitalist class, than as the first Black president of the United States.
The primary beneficiaries of this history-shaking generosity are the same banksters that brought about the economic meltdown through their monstrous invention, the derivative. This fictitious capital – derivatives – created to facilitate gambling on a scale that far exceeds the productive capacity of the entire planet Earth, is a cancer that Barack Obama has chosen to feed, rather than cut out. As F. William Engdahl points out in a recent article, five U.S. banks are the biggest repositories of toxic derivatives: JP Morgan Chase, Bank of America, Citibank, Goldman Sachs and Wells Fargo-Wachovia Bank. Together, these five Banksters of the Apocalypse hold derivatives with the notional value of $193 trillion. That is more than three times the value of the real economy of the whole world – which is about $60 trillion.
These deadly derivatives continue to sit there, immovable, in these five fatally stricken institutions. There are not enough trillions existent in the national or world economies to absorb these fatal instruments. There is nothing rational to do but to wipe the obligations, and their holders, off the face of the Earth, in order to save the real economy. Instead of feeding the cancer, a rational government would use the people’s wealth to create public institutions to dispense credit and guide economic development. The bankster gamblers would be consigned to the dustbin of history – and good riddance. But President Obama has chosen to use the limited resources of the current and future United States – $13 trillion so far – to prop up a criminal class. All the manufactured hoopla about stock market rallies and phony stress tests is intended to mask the central truth of our time: the derivatives cancer will eat away at the real economy until the class that spawned it is cut away, and flushed out of existence.
U.S. Economy: The Cancer is Still There
How does one restore the Lords of Capital to their former positions as dictators of the U.S. and global economies, while keeping their seats warm as de facto political rulers of the American state? Saving the finance capital oligarchy has emerged as President Obama’s central mission – the guiding focus of his young administration. Obama has found new and myriad ways to go where no American president has ever gone before, in funneling somewhere around $13 trillion of national treasure to the parasitical class that goes by the shorthand, Wall Street.
By March of this year, the federal government and the Federal Reserve had “spent, lent or committed” $12.8 trillion to the banksters, according to the Bloomberg financial news service. That amounts to 90 percent of the Gross Domestic Product of the entire United States economy for last year. Let us put it another way: Mostly under the auspices of Barack Obama’s administration, the value of nearly every good and service produced in the United States in 2008 has been, in one way or another, put at the disposal of a tiny financial oligarchy.
This is the kind of overarching reality that defines, not just presidencies, but eras. In the cold assessment of history, Barack Obama will be remembered more for his massive transfers of national wealth to the finance capitalist class, than as the first Black president of the United States.
The primary beneficiaries of this history-shaking generosity are the same banksters that brought about the economic meltdown through their monstrous invention, the derivative. This fictitious capital – derivatives – created to facilitate gambling on a scale that far exceeds the productive capacity of the entire planet Earth, is a cancer that Barack Obama has chosen to feed, rather than cut out. As F. William Engdahl points out in a recent article, five U.S. banks are the biggest repositories of toxic derivatives: JP Morgan Chase, Bank of America, Citibank, Goldman Sachs and Wells Fargo-Wachovia Bank. Together, these five Banksters of the Apocalypse hold derivatives with the notional value of $193 trillion. That is more than three times the value of the real economy of the whole world – which is about $60 trillion.
These deadly derivatives continue to sit there, immovable, in these five fatally stricken institutions. There are not enough trillions existent in the national or world economies to absorb these fatal instruments. There is nothing rational to do but to wipe the obligations, and their holders, off the face of the Earth, in order to save the real economy. Instead of feeding the cancer, a rational government would use the people’s wealth to create public institutions to dispense credit and guide economic development. The bankster gamblers would be consigned to the dustbin of history – and good riddance. But President Obama has chosen to use the limited resources of the current and future United States – $13 trillion so far – to prop up a criminal class. All the manufactured hoopla about stock market rallies and phony stress tests is intended to mask the central truth of our time: the derivatives cancer will eat away at the real economy until the class that spawned it is cut away, and flushed out of existence.
Monday, May 18, 2009
SC91-11
http://jameshowardkunstler.typepad.com/clusterfuck_nation/
Bad Collateral
.........All this is to say why it is so dispiriting to see Mr. Obama's White House mount a campaign to sustain the unsustainable in the economic realm. Everything they've done for four months involving money management and enterprise policy -- from backstopping hopeless banks, to gaming the bankruptcies of the big car companies, to the bungled efforts to prop up artificially-high house prices -- amounts to a gigantic exercise in futility. Worse, it gives off odors of dishonesty or stupidity, since the ominous tendings of our system are so starkly self-evident. Not least of the problems entailed in all this are the scary political consequences. It's one thing for a business such as a bank to fail; its another thing for the public to lose confidence in banking, or their own currency, or the credibility of all the people who work in banking, or the authority of those charged to regulate these activities, or the courts and their officers who are supposed to adjudicate misconduct in them. When faith in all these things starts to go, all bets are off for even larger social constructs like democracy, justice, and the destiny of a federal republic. The Obama White House has very quickly painted itself into a corner on these things. The so-called bank "stress test" couldn't have backfired more completely. Rather than bolster confidence in our money system and the people who run it, it only made the system appear more obviously corrupt. It made the Treasury Department (and the White House by extension) look idiotic for concocting it. Worse, the game of allowing the banks to audit themselves, and cook their books under newly jiggered accounting rules, only made them look less sound and trustworthy, and their executives more venal and mendacious. The stress test scam also virtually guaranteed that the banks will not get another dime out of congress -- even while it is common knowledge that they will desperately need quadrillions more dimes in the months ahead. Who knows what the point of this ludicrous exercise was? Observers in all corners of the media saw through it, and the public has only been made more cynical, and is now so furious over related stunts like AIG using taxpayer money to pay back swaps bets to Goldman Sachs that there is a whiff of revolution in the American air for the first time, really, since 1861. A lot of reasonable people see a good chance that our society will sink into disorder if these trends continue, and these fears could beat a path into radical politics, even the frightful prospect of coup d'etat -- not something that I advocate, by the way. The president is playing with fire on all this. The old economy is not going to recover, and so far he has not used his rhetorical talents to articulate what the next economy is likely to be about. It is reasonable to wonder whether he even really has a clear sense of it -- and, based on the fatuous utterances of his economic mandarins like Larry Summers and Austan Goolsby, this team is really behind the curve. There are plenty of things you can state about the economy past and future with some confidence right now: -- Cheap energy is over and our wishes for alt.energy are currently inconsistent with reality, meaning we have to live differently. -- We have to downscale and re-localize our major economic activities: food production, commerce and manufacturing, banking, schooling, etc. -- We can't hope to have a stable money system unless we allow a workout of unpayable debt to proceed. -- Even if we can do this, universal easy credit is a thing of the past. From now on, we have to save for the things we want and run our businesses and households on accounts receivable. -- Major demographic shifts are inevitable as it becomes necessary to let go of suburbia and reactivate our derelict towns and smaller cities (and allow our giant metroplexes to contract). -- We have to face the truth that our major social contracts cannot be met, namely the continuation of social security as we know it and probably all pension arrangements. We'll probably have to change household arrangements to make up for these losses. -- Health care will have to go through a revolution more comprehensive than just changing how we pay for it. Like everything else, it will have to downscale, re-localize, and become more rigorous. We're not going to rescue the banks. The collateral for their loans is no good and it will only lose more value. All those tract houses on the cul-de-sacs of America and scattered on the out-parcels of our tragically subdivided farming landscape will only lose value, one way or another, in the years ahead. Right now they're simply losing inflated cash value -- and that has been bad enough to sink the banks. In the months and years ahead, they'll lose their sheer usefulness as the distances once mitigated by cheap gasoline loom larger again, and the jobs vanish and incomes with them, and the supermarket shelves cease to groan with eighty-seven different varieties of flavored coffee creamers, and one-by-one the national chain stores shutter, and the theme parks, and the Nascar ovals, and the malls, and the colossal superfluous cretin-cargo of consumer nonsense that we've been daydreaming in gets blown away in a hurricane of change that we were not ready to believe in.
Bad Collateral
.........All this is to say why it is so dispiriting to see Mr. Obama's White House mount a campaign to sustain the unsustainable in the economic realm. Everything they've done for four months involving money management and enterprise policy -- from backstopping hopeless banks, to gaming the bankruptcies of the big car companies, to the bungled efforts to prop up artificially-high house prices -- amounts to a gigantic exercise in futility. Worse, it gives off odors of dishonesty or stupidity, since the ominous tendings of our system are so starkly self-evident. Not least of the problems entailed in all this are the scary political consequences. It's one thing for a business such as a bank to fail; its another thing for the public to lose confidence in banking, or their own currency, or the credibility of all the people who work in banking, or the authority of those charged to regulate these activities, or the courts and their officers who are supposed to adjudicate misconduct in them. When faith in all these things starts to go, all bets are off for even larger social constructs like democracy, justice, and the destiny of a federal republic. The Obama White House has very quickly painted itself into a corner on these things. The so-called bank "stress test" couldn't have backfired more completely. Rather than bolster confidence in our money system and the people who run it, it only made the system appear more obviously corrupt. It made the Treasury Department (and the White House by extension) look idiotic for concocting it. Worse, the game of allowing the banks to audit themselves, and cook their books under newly jiggered accounting rules, only made them look less sound and trustworthy, and their executives more venal and mendacious. The stress test scam also virtually guaranteed that the banks will not get another dime out of congress -- even while it is common knowledge that they will desperately need quadrillions more dimes in the months ahead. Who knows what the point of this ludicrous exercise was? Observers in all corners of the media saw through it, and the public has only been made more cynical, and is now so furious over related stunts like AIG using taxpayer money to pay back swaps bets to Goldman Sachs that there is a whiff of revolution in the American air for the first time, really, since 1861. A lot of reasonable people see a good chance that our society will sink into disorder if these trends continue, and these fears could beat a path into radical politics, even the frightful prospect of coup d'etat -- not something that I advocate, by the way. The president is playing with fire on all this. The old economy is not going to recover, and so far he has not used his rhetorical talents to articulate what the next economy is likely to be about. It is reasonable to wonder whether he even really has a clear sense of it -- and, based on the fatuous utterances of his economic mandarins like Larry Summers and Austan Goolsby, this team is really behind the curve. There are plenty of things you can state about the economy past and future with some confidence right now: -- Cheap energy is over and our wishes for alt.energy are currently inconsistent with reality, meaning we have to live differently. -- We have to downscale and re-localize our major economic activities: food production, commerce and manufacturing, banking, schooling, etc. -- We can't hope to have a stable money system unless we allow a workout of unpayable debt to proceed. -- Even if we can do this, universal easy credit is a thing of the past. From now on, we have to save for the things we want and run our businesses and households on accounts receivable. -- Major demographic shifts are inevitable as it becomes necessary to let go of suburbia and reactivate our derelict towns and smaller cities (and allow our giant metroplexes to contract). -- We have to face the truth that our major social contracts cannot be met, namely the continuation of social security as we know it and probably all pension arrangements. We'll probably have to change household arrangements to make up for these losses. -- Health care will have to go through a revolution more comprehensive than just changing how we pay for it. Like everything else, it will have to downscale, re-localize, and become more rigorous. We're not going to rescue the banks. The collateral for their loans is no good and it will only lose more value. All those tract houses on the cul-de-sacs of America and scattered on the out-parcels of our tragically subdivided farming landscape will only lose value, one way or another, in the years ahead. Right now they're simply losing inflated cash value -- and that has been bad enough to sink the banks. In the months and years ahead, they'll lose their sheer usefulness as the distances once mitigated by cheap gasoline loom larger again, and the jobs vanish and incomes with them, and the supermarket shelves cease to groan with eighty-seven different varieties of flavored coffee creamers, and one-by-one the national chain stores shutter, and the theme parks, and the Nascar ovals, and the malls, and the colossal superfluous cretin-cargo of consumer nonsense that we've been daydreaming in gets blown away in a hurricane of change that we were not ready to believe in.
Sunday, May 17, 2009
SC91-10
http://www.moneyandmarkets.com/five-economic-storms-raging-now-2-33662
Five Economic Storms Raging NOW!
......Any economist fixated on so-called “signs of a recovery” needs to have his head examined.
As I’ll prove to you in a moment, the hard-nosed reality is that five major economic cyclones are in progress at this very moment.
The storms are not abating. Nor are they changing direction. Quite the contrary, what you see today is, at best, merely a deceptive calm before the next, even larger tempests......
Storm #1.
Plunging Jobs
On Friday, the Bureau of Labor Statistics announced that job losses were running at a slightly slower pace than in the first quarter. So Wall Street cheered.
But it’s a joke, and the 539,000 additional Americans out of work aren’t laughing.
Nor are the 23 million people — 15.8 percent of the work force — who are officially unemployed … are struggling with lower paying part-time jobs … or have given up looking for work entirely.
Look. In December 2007, there were 138.1 million jobs in America. Now, there are only 132.4 million.
So even if you accept the government’s tally of the narrowest unemployment measure, 5.7 million jobs have been lost.
Plot those figures on a chart and the picture is absolutely unambiguous: Jobs in America are collapsing. Right here and now!
Where’s that “slightly slower pace of collapse” they’re raving about? You’d need a microscope to see it.
Storm #2 U.S.
Housing Starts Down 77.6 Percent!
Housing is the nation’s largest industry. With it, the entire global economy boomed in the mid-2000s. Without it, a recovery is next to impossible.
The big picture: Housing starts, the best measure of the industry’s health, peaked at an annual pace of 2.3 million units in early 2006.
Now, they’re running at barely more than a 0.5 million units.
That’s a decline of 77.6 percent — three-quarters of America’s largest single industry wiped out.
Yes, back in February, there was a tiny uptick: Starts rose from 488,000 to 572,000. And everywhere we heard voices cheering the “spectacular” jump in housing starts.
What they didn’t tell you is that the so-called “jump” was actually smaller than six of the seven minor upticks we’ve seen in housing starts since 2006. Nor did you hear them say much when this measure fell anew in March.
This industry is not recovering. It remains in a state of near total collapse.
The only major change: Lenders have given up waiting for a recovery that never comes. So they’re throwing in the towel, unloading huge inventories of foreclosed properties at fire-sale prices. And they’re calling that a “recovery”?
Storm #3
Auto Sales Down 44 Percent!
At their peak in February 2007, U.S. and foreign-owned companies sold automobiles in America at an annual pace of 16.6 million units.
Last month, their sales pace plunged to 9.3 million, a decline of44 percent (including the best performers like Toyota and Honda).
Again, as with housing, we saw a tiny uptick in the prior month, hailed by high officials as a “sign” of improvement. Yet, as with housing, it was weaker than all prior “signs of a turn” over the past 26 months — each of which was followed by a sharper plunge.
Any lights at the end to Detroit’s dark tunnel? Only those of three speeding freight trains:
The Chrysler bankruptcy, despite all the talk of a “quick and easy” procedure, is not only frightening U.S. car buyers away from the Chrysler brand, it’s also scaring them from other U.S. and foreign makers. And it’s not only hurting auto dealers and parts suppliers, but also smacking auto lenders. Meanwhile …
GMAC, the nation’s largest auto lender, is already in its death throes, with the government now estimating it could suffer additional losses of a whopping $9.2 billion over the next two years. Will the Obama administration bail it out? Perhaps. But it would still have to downsize its operations, throwing another monkey wrench into General Motors’ sales. Meanwhile …
General Motors is now sinking even more rapidly toward bankruptcy than it was just a few months ago. According to last week’s New York Times column, G.M., Leaking Cash, Faces Bigger Chance of Bankruptcy … “Even after receiving $15.4 billion in federal loans, General Motors is once again on the brink of financial collapse.
“The automaker’s first-quarter earnings released Thursday showed that G.M. was losing more money and sales than it was in late December, when the government began its bailout.
“With its cash reserves down to the bare minimum and its revenue plunging, G.M. seems more certain each day to be heading toward a bankruptcy filing. …
“The company’s chief financial officer, Ray Young, called the drop … ‘a staggering number,’ and said consumers were showing increasing concern about G.M. products because of the potential for bankruptcy.”
General Motors’ CFO added: “Once you start losing revenues, you get yourself into a vicious cycle from which you cannot recover.”
Sound familiar? It should. It’s the same vicious cycle I’ve been warning about for many moons — falling revenues prompting mass layoffs, and mass layoffs driving down revenues.
Storm #4
Biggest Decline in ConsumerCredit Ever Recorded!
Any economist counting on the consumer to get things going again had better go back for some more Rorschach tests …
… because you don’t need a therapist to interpret the image depicted in my chart below. It shows very clearly how the nation’s lenders are dumping consumers and making a mad dash for the exits:
In the third quarter of 2007, banks dished out $44 billion in net new loans on credit cards, autos, and other consumer credit (excluding mortgages).
Then, just 12 months later, in the third quarter of 2008, that giant credit machine collapsed to a meager $8.7 billion, a decline of 80 percent!
But the collapse didn’t end there. In last year’s fourth quarter, not only did new credit disappear, but lenders actually pulled out of the consumer credit market to the tune of $19.5 billion.
And they did it AGAIN in the first quarter of this year, pulling out another $12.2 billion.
It is the biggest collapse in consumer credit ever recorded.
Now do you see why I’m recommending a shrink for any economist fixated on a recovery?
They know how important credit is. They know that few Americans have the savings to splurge on consumer goods. And they’re tired of knowing that a recovery is virtually impossible without credit.
And yet here we are, with the biggest-ever collapse in consumer credit — and they’re still searching for the “signs”!
Storm #5
Big Banks!
Whether the government lets big banks fail or not, the impact on the economy is similar: A massive contraction of bank loans and credit, sabotaging attempts to revive credit flows and stimulate the economy.
Reason: These banks must build capital quickly, and the only realistic way to do so is by cutting back on their lending.
The official stress test results released Thursday on 19 U.S. bank holding companies were supposed to help determine exactly how much capital they’ll need, and the total came to $75 billion.
That’s no small amount. But the stress tests will go down in history as the world’s most elaborate effort to paint lipstick on a pig.
To show you why, first, let me provide our analysis based on data from TheStreet.com Ratings, the Comptroller of the Currency (OCC), and the banks’ first-quarter financial statements. Then I’ll show you why I believe the official results grossly underestimate how much capital the banks will need and how much pressure they’ll be under to slash lending.
We find that …
Seven institutions — JPMorgan Chase & Co., Citigroup, Wells Fargo & Co., Goldman Sachs Group, GMAC LLC, SunTrust Banks, Inc., and Fifth Third Bancorp — are at risk of failure and may have to cut back lending dramatically to stay alive. Eight institutions — Bank of America, Morgan Stanley, PNC Financial Services Group, US Bancorp, BB&T Corp., Regions Financial Corp., American Express Co., and Keycorp — are borderline, meaning they could be at risk of failure with worsening economic or financial conditions and will also have to cut back on lending. Only four institutions — MetLife, Bank of NY Mellon Corp., Capital One Financial Corp., and State Street Corp. — appear to have adequate capital to withstand worsening conditions. But even they may voluntarily cut back their lending in an attempt to maintain their current financial health. Moreover, of the $11.6 trillion in assets held by the 19 institutions, those likely to cut back dramatically represent $6.56 trillion, or 56.5 percent, of the assets; while borderline institutions hold $4 trillion, or 34.7 percent.
Only $1 trillion — just 8.8 percent — of the assets are held by institutions with adequate capital, based on our analysis.
In contrast, the government is trying to persuade us that most have plenty of capital … the rest can easily raise it … and none will have to slash lending in a way that would sabotage the prospects for an economic recovery.
So what explains this vast discrepancy between the official conclusions and ours?
The simple answer: Three unmistakable deceptions in the government’s stress tests …..
Go to the website to read about the details of these deceptions.
Five Economic Storms Raging NOW!
......Any economist fixated on so-called “signs of a recovery” needs to have his head examined.
As I’ll prove to you in a moment, the hard-nosed reality is that five major economic cyclones are in progress at this very moment.
The storms are not abating. Nor are they changing direction. Quite the contrary, what you see today is, at best, merely a deceptive calm before the next, even larger tempests......
Storm #1.
Plunging Jobs
On Friday, the Bureau of Labor Statistics announced that job losses were running at a slightly slower pace than in the first quarter. So Wall Street cheered.
But it’s a joke, and the 539,000 additional Americans out of work aren’t laughing.
Nor are the 23 million people — 15.8 percent of the work force — who are officially unemployed … are struggling with lower paying part-time jobs … or have given up looking for work entirely.
Look. In December 2007, there were 138.1 million jobs in America. Now, there are only 132.4 million.
So even if you accept the government’s tally of the narrowest unemployment measure, 5.7 million jobs have been lost.
Plot those figures on a chart and the picture is absolutely unambiguous: Jobs in America are collapsing. Right here and now!
Where’s that “slightly slower pace of collapse” they’re raving about? You’d need a microscope to see it.
Storm #2 U.S.
Housing Starts Down 77.6 Percent!
Housing is the nation’s largest industry. With it, the entire global economy boomed in the mid-2000s. Without it, a recovery is next to impossible.
The big picture: Housing starts, the best measure of the industry’s health, peaked at an annual pace of 2.3 million units in early 2006.
Now, they’re running at barely more than a 0.5 million units.
That’s a decline of 77.6 percent — three-quarters of America’s largest single industry wiped out.
Yes, back in February, there was a tiny uptick: Starts rose from 488,000 to 572,000. And everywhere we heard voices cheering the “spectacular” jump in housing starts.
What they didn’t tell you is that the so-called “jump” was actually smaller than six of the seven minor upticks we’ve seen in housing starts since 2006. Nor did you hear them say much when this measure fell anew in March.
This industry is not recovering. It remains in a state of near total collapse.
The only major change: Lenders have given up waiting for a recovery that never comes. So they’re throwing in the towel, unloading huge inventories of foreclosed properties at fire-sale prices. And they’re calling that a “recovery”?
Storm #3
Auto Sales Down 44 Percent!
At their peak in February 2007, U.S. and foreign-owned companies sold automobiles in America at an annual pace of 16.6 million units.
Last month, their sales pace plunged to 9.3 million, a decline of44 percent (including the best performers like Toyota and Honda).
Again, as with housing, we saw a tiny uptick in the prior month, hailed by high officials as a “sign” of improvement. Yet, as with housing, it was weaker than all prior “signs of a turn” over the past 26 months — each of which was followed by a sharper plunge.
Any lights at the end to Detroit’s dark tunnel? Only those of three speeding freight trains:
The Chrysler bankruptcy, despite all the talk of a “quick and easy” procedure, is not only frightening U.S. car buyers away from the Chrysler brand, it’s also scaring them from other U.S. and foreign makers. And it’s not only hurting auto dealers and parts suppliers, but also smacking auto lenders. Meanwhile …
GMAC, the nation’s largest auto lender, is already in its death throes, with the government now estimating it could suffer additional losses of a whopping $9.2 billion over the next two years. Will the Obama administration bail it out? Perhaps. But it would still have to downsize its operations, throwing another monkey wrench into General Motors’ sales. Meanwhile …
General Motors is now sinking even more rapidly toward bankruptcy than it was just a few months ago. According to last week’s New York Times column, G.M., Leaking Cash, Faces Bigger Chance of Bankruptcy … “Even after receiving $15.4 billion in federal loans, General Motors is once again on the brink of financial collapse.
“The automaker’s first-quarter earnings released Thursday showed that G.M. was losing more money and sales than it was in late December, when the government began its bailout.
“With its cash reserves down to the bare minimum and its revenue plunging, G.M. seems more certain each day to be heading toward a bankruptcy filing. …
“The company’s chief financial officer, Ray Young, called the drop … ‘a staggering number,’ and said consumers were showing increasing concern about G.M. products because of the potential for bankruptcy.”
General Motors’ CFO added: “Once you start losing revenues, you get yourself into a vicious cycle from which you cannot recover.”
Sound familiar? It should. It’s the same vicious cycle I’ve been warning about for many moons — falling revenues prompting mass layoffs, and mass layoffs driving down revenues.
Storm #4
Biggest Decline in ConsumerCredit Ever Recorded!
Any economist counting on the consumer to get things going again had better go back for some more Rorschach tests …
… because you don’t need a therapist to interpret the image depicted in my chart below. It shows very clearly how the nation’s lenders are dumping consumers and making a mad dash for the exits:
In the third quarter of 2007, banks dished out $44 billion in net new loans on credit cards, autos, and other consumer credit (excluding mortgages).
Then, just 12 months later, in the third quarter of 2008, that giant credit machine collapsed to a meager $8.7 billion, a decline of 80 percent!
But the collapse didn’t end there. In last year’s fourth quarter, not only did new credit disappear, but lenders actually pulled out of the consumer credit market to the tune of $19.5 billion.
And they did it AGAIN in the first quarter of this year, pulling out another $12.2 billion.
It is the biggest collapse in consumer credit ever recorded.
Now do you see why I’m recommending a shrink for any economist fixated on a recovery?
They know how important credit is. They know that few Americans have the savings to splurge on consumer goods. And they’re tired of knowing that a recovery is virtually impossible without credit.
And yet here we are, with the biggest-ever collapse in consumer credit — and they’re still searching for the “signs”!
Storm #5
Big Banks!
Whether the government lets big banks fail or not, the impact on the economy is similar: A massive contraction of bank loans and credit, sabotaging attempts to revive credit flows and stimulate the economy.
Reason: These banks must build capital quickly, and the only realistic way to do so is by cutting back on their lending.
The official stress test results released Thursday on 19 U.S. bank holding companies were supposed to help determine exactly how much capital they’ll need, and the total came to $75 billion.
That’s no small amount. But the stress tests will go down in history as the world’s most elaborate effort to paint lipstick on a pig.
To show you why, first, let me provide our analysis based on data from TheStreet.com Ratings, the Comptroller of the Currency (OCC), and the banks’ first-quarter financial statements. Then I’ll show you why I believe the official results grossly underestimate how much capital the banks will need and how much pressure they’ll be under to slash lending.
We find that …
Seven institutions — JPMorgan Chase & Co., Citigroup, Wells Fargo & Co., Goldman Sachs Group, GMAC LLC, SunTrust Banks, Inc., and Fifth Third Bancorp — are at risk of failure and may have to cut back lending dramatically to stay alive. Eight institutions — Bank of America, Morgan Stanley, PNC Financial Services Group, US Bancorp, BB&T Corp., Regions Financial Corp., American Express Co., and Keycorp — are borderline, meaning they could be at risk of failure with worsening economic or financial conditions and will also have to cut back on lending. Only four institutions — MetLife, Bank of NY Mellon Corp., Capital One Financial Corp., and State Street Corp. — appear to have adequate capital to withstand worsening conditions. But even they may voluntarily cut back their lending in an attempt to maintain their current financial health. Moreover, of the $11.6 trillion in assets held by the 19 institutions, those likely to cut back dramatically represent $6.56 trillion, or 56.5 percent, of the assets; while borderline institutions hold $4 trillion, or 34.7 percent.
Only $1 trillion — just 8.8 percent — of the assets are held by institutions with adequate capital, based on our analysis.
In contrast, the government is trying to persuade us that most have plenty of capital … the rest can easily raise it … and none will have to slash lending in a way that would sabotage the prospects for an economic recovery.
So what explains this vast discrepancy between the official conclusions and ours?
The simple answer: Three unmistakable deceptions in the government’s stress tests …..
Go to the website to read about the details of these deceptions.
Friday, May 15, 2009
SC91-9
http://www.theoildrum.com/node/5381
On American Sustainability—Anatomy of a Societal Collapse (Summary)
The Real “Inconvenient Truth”
Most Americans believe that we are “exceptional”—both as a society and as a species. We believe that America was ordained through divine providence to be the societal role model for the world. And we believe that through our superior intellect, we can harness and even conquer Nature in our continuous quest to improve the material living standards associated with our ever-increasing population.
The truth is that our pioneering predecessors drifted, quite by accident, upon a veritable treasure trove of natural resources and natural habitats, which they wrested by force from the native inhabitants, and which we have persistently overexploited in order to create and perpetuate our American way of life. The truth is that through our “divine ordination” and “superior intellect”, we have been persistently and systematically eliminating the very resources upon which our way of life and our existence depend.
We now find ourselves in a “predicament”. We are irreparably overextended—living hopelessly beyond our means ecologically and economically—at a time when the supplies of many critical resources upon which we depend will soon be insufficient to enable our American way of life. We are about to discover that we are simply another unsustainable society subject to the inescapable consequence of our unsustainable resource utilization behavior—societal collapse.
America’s Predicament—Societal Overextension
Societal overextension occurs when a society’s lifestyle paradigm, its “way of life”, is enabled by the persistent overexploitation of ecological resources and economic resources.
Ecological resource over-exploitation occurs when a society:
• Persistently utilizes renewable natural resources that are critical to its existence—such as water, croplands, grazing lands, wildlife, and forests—at levels exceeding those at which Nature can replenish them;
• Persistently utilizes nonrenewable natural resources that are critical to its existence—such as oil, natural gas, coal, minerals, and metals—which Nature does not replenish; and/or
• Persistently degrades atmospheric, aquatic, and terrestrial natural habitats that are critical to its existence, at levels exceeding those at which Nature can regenerate them.
Economic resources such as income, savings, and debt provide the “purchasing power” that enables people to procure natural resources and the manmade goods and services derived from those natural resources. Economic resource overexploitation occurs when a society:
• Persistently depletes its previously accumulated economic asset (wealth) reserves;
• Persistently incurs intergenerational debt, which it has neither the capacity nor the intention to repay; and/or
• Persistently underfunds investments critical to its future wellbeing.
An overextended society is unsustainable, and will inevitably collapse.
Consequence of American Societal Overextension
As the historically abundant and cheap resources upon which our American way of life depends become increasingly scarce and expensive, a scenario that is already in process, the total level of natural resources and derived goods and services available for our consumption will decline dramatically, as must some combination of our population level and material living standards.
Absent immediate fundamental changes to both our distorted worldview and our dysfunctional resource utilization behavior, American society will collapse—not in 1000 years, or 500 years, or even 50 years; but almost certainly within 25 years. America, as we know it, will cease to exist well before the year 2050.
The Magnitude of America’s Predicament
American Societal Overextension Quantified
The extent to which we are currently living unsustainably beyond our means is appalling.
In an attempt to put the incredible magnitude associated with our predicament into perspective, it is as though we are currently spending $30.40 from a finite, one-time inheritance for each $1 of current income that we earn—almost 97% of our current total consumption level is enabled by our dwindling inheritance. So while we have grown accustomed to living unsustainably on $31.40, we will have to learn to live sustainably on only $1—soon.
The Resolution of America’s Predicament
Sustainability is Inevitable
Most Americans believe that any conceivable problem can and will be resolved through some combination of American ingenuity, technical innovation, hard work, and perseverance. “They”, presumably a different “they” than the “they” who allegedly cause all of our societal level problems, have always developed timely solutions to our problems in the past—and they always will.
Our predicament—irreparable societal overextension resulting from our persistent overexploitation of the increasingly scarce ecological and economic resources that enable our very existence—cannot be resolved within the context of our existing inherently-overexploitive lifestyle paradigm, which is responsible for our predicament in the first place. No amount of ingenuity, innovation, and effort can create unlimited resources on a finite planet.
America’s Choice: Voluntary or Involuntary Transition to Sustainability
There are no other alternatives—we “will be” sustainable, either voluntarily or involuntarily; and we will be sustainable soon. Our maximum attainable population level and living standards at sustainability will be determined by our transition process.
Sustainable American Lifestyle Attributes
Even under the most optimistic scenario, whereby we transition voluntarily to a sustainable lifestyle paradigm, our population level and living standard combinations attainable “at sustainability” will be substantially lower than those that we currently enjoy.
America’s Destiny
We are the hapless perpetrators of our own demise: we are driving full speed on the self-chosen “industrialization” highway toward a minefield of lethal limits to our existing lifestyle paradigm; yet we are culturally incapable of stopping or of exiting from the highway.
America’s Paradox
The cause of our “success” will be the cause of our demise…
America’s culture of persistent resource overexploitation has enabled our historically unprecedented “success”—our extraordinary American way of life. Unfortunately, our culture of persistent resource overexploitation is also responsible for our “predicament”—irreparable societal overextension. And, since we are unwilling to voluntarily relinquish our success in order to resolve our predicament, our culture of persistent resource over-exploitation will be responsible for our inevitable demise—societal collapse.
The ultimate irony is that the more quickly we deplete remaining domestic and global resource reserves in futile attempts to perpetuate our American way of life, the more quickly we will reach a resource limit and trigger our Societal Collapse.
America’s Conundrum
The only rational solution to our predicament, a voluntary transition to sustainability, is an impossible solution…
Our American way of life is enabled almost exclusively by our ever-increasing utilization of nonrenewable natural resources; yet available supplies associated with these resources are finite and are becoming increasingly scarce.
A vast majority of us are “culturally incapable” of acknowledging our predicament, much less taking meaningful action to resolve it—we suffer from societal cognitive dissonance. While we acknowledge that “we have our problems”, we consider the idea that our American way of life is unsustainable to be utterly preposterous. America will continue to grow and prosper forever—because we say it will. Our vested interest in the continued success of our American way of life is simply too great to permit us to consider any argument or evidence to the contrary.
The minority who do acknowledge the reality of our predicament will continue to insist that “they”—our political and economic representatives—“fix it”; when, in fact, we ourselves are responsible for “it”, and for the fact that it cannot be fixed—because we will not allow it to be fixed. Fixing our predicament would require that we live sustainably within our means forever—a “sacrifice” that we consider to be totally unacceptable.
The Unraveling
We will not, therefore, take preemptive action to mitigate the consequences associated with our predicament. We will not choose to modify voluntarily our distorted, cornucopian worldview and our dysfunctional, detritovoric resource utilization behavior.
We will instead continue to use the remaining ecological and economic resources available to us in futile attempts to perpetuate our American way of life—behavior that will become increasingly desperate as we encounter increasingly severe resource supply shortages and disruptions.
We will continue to cling to the deluded belief that we can somehow substitute hope, faith, determination, technical ingenuity, and additional investment for the finite and dwindling resources that enable our unsustainable American way of life.
Warning Signs
From the perspective of mainstream America and our “thought leaders”, both our Last Depression and our Societal Collapse will “arrive without warning” and will “catch us totally by surprise”. We will continue to misconstrue the early warning signs associated with our two impending disasters as “normal cyclical economic activity”.
Rather than sounding alarms and attempting to take meaningful mitigating action, we will instead persist in our futile attempts to remedy the consequences associated with our past overexploitive resource utilization behavior with ever-increasing levels of current and future overexploitive resource utilization behavior. These measures will, at best, temporarily defer our inevitable collapse—they will not “fix” that which cannot possibly be fixed........
The warning bells have been sounding. What we are currently experiencing is not “normal cyclical economic activity”. The initial stages of US societal collapse have begun.
On American Sustainability—Anatomy of a Societal Collapse (Summary)
The Real “Inconvenient Truth”
Most Americans believe that we are “exceptional”—both as a society and as a species. We believe that America was ordained through divine providence to be the societal role model for the world. And we believe that through our superior intellect, we can harness and even conquer Nature in our continuous quest to improve the material living standards associated with our ever-increasing population.
The truth is that our pioneering predecessors drifted, quite by accident, upon a veritable treasure trove of natural resources and natural habitats, which they wrested by force from the native inhabitants, and which we have persistently overexploited in order to create and perpetuate our American way of life. The truth is that through our “divine ordination” and “superior intellect”, we have been persistently and systematically eliminating the very resources upon which our way of life and our existence depend.
We now find ourselves in a “predicament”. We are irreparably overextended—living hopelessly beyond our means ecologically and economically—at a time when the supplies of many critical resources upon which we depend will soon be insufficient to enable our American way of life. We are about to discover that we are simply another unsustainable society subject to the inescapable consequence of our unsustainable resource utilization behavior—societal collapse.
America’s Predicament—Societal Overextension
Societal overextension occurs when a society’s lifestyle paradigm, its “way of life”, is enabled by the persistent overexploitation of ecological resources and economic resources.
Ecological resource over-exploitation occurs when a society:
• Persistently utilizes renewable natural resources that are critical to its existence—such as water, croplands, grazing lands, wildlife, and forests—at levels exceeding those at which Nature can replenish them;
• Persistently utilizes nonrenewable natural resources that are critical to its existence—such as oil, natural gas, coal, minerals, and metals—which Nature does not replenish; and/or
• Persistently degrades atmospheric, aquatic, and terrestrial natural habitats that are critical to its existence, at levels exceeding those at which Nature can regenerate them.
Economic resources such as income, savings, and debt provide the “purchasing power” that enables people to procure natural resources and the manmade goods and services derived from those natural resources. Economic resource overexploitation occurs when a society:
• Persistently depletes its previously accumulated economic asset (wealth) reserves;
• Persistently incurs intergenerational debt, which it has neither the capacity nor the intention to repay; and/or
• Persistently underfunds investments critical to its future wellbeing.
An overextended society is unsustainable, and will inevitably collapse.
Consequence of American Societal Overextension
As the historically abundant and cheap resources upon which our American way of life depends become increasingly scarce and expensive, a scenario that is already in process, the total level of natural resources and derived goods and services available for our consumption will decline dramatically, as must some combination of our population level and material living standards.
Absent immediate fundamental changes to both our distorted worldview and our dysfunctional resource utilization behavior, American society will collapse—not in 1000 years, or 500 years, or even 50 years; but almost certainly within 25 years. America, as we know it, will cease to exist well before the year 2050.
The Magnitude of America’s Predicament
American Societal Overextension Quantified
The extent to which we are currently living unsustainably beyond our means is appalling.
In an attempt to put the incredible magnitude associated with our predicament into perspective, it is as though we are currently spending $30.40 from a finite, one-time inheritance for each $1 of current income that we earn—almost 97% of our current total consumption level is enabled by our dwindling inheritance. So while we have grown accustomed to living unsustainably on $31.40, we will have to learn to live sustainably on only $1—soon.
The Resolution of America’s Predicament
Sustainability is Inevitable
Most Americans believe that any conceivable problem can and will be resolved through some combination of American ingenuity, technical innovation, hard work, and perseverance. “They”, presumably a different “they” than the “they” who allegedly cause all of our societal level problems, have always developed timely solutions to our problems in the past—and they always will.
Our predicament—irreparable societal overextension resulting from our persistent overexploitation of the increasingly scarce ecological and economic resources that enable our very existence—cannot be resolved within the context of our existing inherently-overexploitive lifestyle paradigm, which is responsible for our predicament in the first place. No amount of ingenuity, innovation, and effort can create unlimited resources on a finite planet.
America’s Choice: Voluntary or Involuntary Transition to Sustainability
There are no other alternatives—we “will be” sustainable, either voluntarily or involuntarily; and we will be sustainable soon. Our maximum attainable population level and living standards at sustainability will be determined by our transition process.
Sustainable American Lifestyle Attributes
Even under the most optimistic scenario, whereby we transition voluntarily to a sustainable lifestyle paradigm, our population level and living standard combinations attainable “at sustainability” will be substantially lower than those that we currently enjoy.
America’s Destiny
We are the hapless perpetrators of our own demise: we are driving full speed on the self-chosen “industrialization” highway toward a minefield of lethal limits to our existing lifestyle paradigm; yet we are culturally incapable of stopping or of exiting from the highway.
America’s Paradox
The cause of our “success” will be the cause of our demise…
America’s culture of persistent resource overexploitation has enabled our historically unprecedented “success”—our extraordinary American way of life. Unfortunately, our culture of persistent resource overexploitation is also responsible for our “predicament”—irreparable societal overextension. And, since we are unwilling to voluntarily relinquish our success in order to resolve our predicament, our culture of persistent resource over-exploitation will be responsible for our inevitable demise—societal collapse.
The ultimate irony is that the more quickly we deplete remaining domestic and global resource reserves in futile attempts to perpetuate our American way of life, the more quickly we will reach a resource limit and trigger our Societal Collapse.
America’s Conundrum
The only rational solution to our predicament, a voluntary transition to sustainability, is an impossible solution…
Our American way of life is enabled almost exclusively by our ever-increasing utilization of nonrenewable natural resources; yet available supplies associated with these resources are finite and are becoming increasingly scarce.
A vast majority of us are “culturally incapable” of acknowledging our predicament, much less taking meaningful action to resolve it—we suffer from societal cognitive dissonance. While we acknowledge that “we have our problems”, we consider the idea that our American way of life is unsustainable to be utterly preposterous. America will continue to grow and prosper forever—because we say it will. Our vested interest in the continued success of our American way of life is simply too great to permit us to consider any argument or evidence to the contrary.
The minority who do acknowledge the reality of our predicament will continue to insist that “they”—our political and economic representatives—“fix it”; when, in fact, we ourselves are responsible for “it”, and for the fact that it cannot be fixed—because we will not allow it to be fixed. Fixing our predicament would require that we live sustainably within our means forever—a “sacrifice” that we consider to be totally unacceptable.
The Unraveling
We will not, therefore, take preemptive action to mitigate the consequences associated with our predicament. We will not choose to modify voluntarily our distorted, cornucopian worldview and our dysfunctional, detritovoric resource utilization behavior.
We will instead continue to use the remaining ecological and economic resources available to us in futile attempts to perpetuate our American way of life—behavior that will become increasingly desperate as we encounter increasingly severe resource supply shortages and disruptions.
We will continue to cling to the deluded belief that we can somehow substitute hope, faith, determination, technical ingenuity, and additional investment for the finite and dwindling resources that enable our unsustainable American way of life.
Warning Signs
From the perspective of mainstream America and our “thought leaders”, both our Last Depression and our Societal Collapse will “arrive without warning” and will “catch us totally by surprise”. We will continue to misconstrue the early warning signs associated with our two impending disasters as “normal cyclical economic activity”.
Rather than sounding alarms and attempting to take meaningful mitigating action, we will instead persist in our futile attempts to remedy the consequences associated with our past overexploitive resource utilization behavior with ever-increasing levels of current and future overexploitive resource utilization behavior. These measures will, at best, temporarily defer our inevitable collapse—they will not “fix” that which cannot possibly be fixed........
The warning bells have been sounding. What we are currently experiencing is not “normal cyclical economic activity”. The initial stages of US societal collapse have begun.
Thursday, May 14, 2009
SC91-8
http://informationclearinghouse.info/article22611.htm
Who Rules America?
What do you suppose it is like to be elected president of the United States only to find that your power is restricted to the service of powerful interest groups? A president who does a good job for the ruling interest groups is paid off with remunerative corporate directorships, outrageous speaking fees, and a lucrative book contract. If he is young when he assumes office, like Bill Clinton and Obama, it means a long life of luxurious leisure. Fighting the special interests doesn’t pay and doesn’t succeed. On April 30 the primacy of special over public interests was demonstrated yet again. The Democrats’ bill to prevent 1.7 million mortgage foreclosures and, thus, preserve $300 billion in home equity by permitting homeowners to renegotiate their mortgages, was defeated in the Senate, despite the 60-vote majority of the Democrats. The banksters were able to defeat the bill 51 to 45. These are the same financial gangsters whose unbridled greed and utter irresponsibility have wiped out half of Americans’ retirement savings, sent the economy into a deep hole, and threatened the US dollar’s reserve currency role. It is difficult to imagine an interest group with a more damaged reputation. Yet, a majority of “the people’s representatives” voted as the discredited banksters instructed. Hundreds of billions of public dollars have gone to bail out the banksters, but when some Democrats tried to get the Senate to do a mite for homeowners, the US Senate stuck with the banks. The Senate’s motto is: “Hundreds of billions for the banksters, not a dime for homeowners.” If Obama was naive about well-intentioned change before the vote, he no longer has this political handicap. Democratic Majority Whip Dick Durbin acknowledged the voters’ defeat by the discredited banksters. The banks, Durbin said, “frankly own the place.” It is not difficult to understand why. Among those who defeated the homeowners bill are senators Jon Tester (Mont), Max Baucus (Mont), Blanche Lincoln (Ark), Ben Nelson (Neb), Many Landrieu (La), Tim Johnson (SD), and Arlan Specter (Pa). According to reports, the banksters have poured a half million dollars into Tester’s campaign funds. Baucus has received $3.5 million; Lincoln $1.3 million; Nelson $1.4 million; Landrieu $2 million; Johnson $2.5 million; Specter $4.5 million. The same Congress that can’t find a dime for homeowners or health care appropriates hundreds of billions of dollars for the military/security complex. The week after the Senate foreclosed on American homeowners, the Obama “change” administration asked Congress for an additional $61 billion dollars for the neoconservatives’ war in Iraq and $65 billion more for the neoconservatives’ war in Afghanistan. Congress greeted this request with a rousing “Yes we can!” The additional $126 billion comes on top of the $533.7 billion “defense” budget for this year. The $660 billion--probably a low-ball number--is ten times the military spending of China, the second most powerful country in the world. How is it possible that “the world’s only superpower” is threatened by the likes of Iraq and Afghanistan? How can the US be a superpower if it is threatened by countries that have no military capability other than a guerilla capability to resist invaders? These “wars” are a hoax designed to enrich the US armaments industry and to infuse the “security forces” with police powers over American citizenry. Not a dime to prevent millions of Americans from losing their homes, but hundreds of billions of dollars to murder Muslim women and children and to create millions of refugees, many of whom will either sign up with insurgents or end up as the next wave of immigrants into America. This is the way the American government works. And it thinks it is a “city on the hill, a light unto the world.” Americans elected Obama because he said he would end the gratuitous criminal wars of the Bush brownshirts, wars that have destroyed America’s reputation and financial solvency and serve no public interest. But once in office Obama found that he was ruled by the military/security complex. War is not being ended, merely transferred from the unpopular war in Iraq to the more popular war in Afghanistan. Meanwhile, Obama, in violation of Pakistan’s sovereignty, continues to attack “targets” in Pakistan. In place of a war in Iraq, the military/security complex now has two wars going in much more difficult circumstances. Viewing the promotion gravy train that results from decades of warfare, the US officer corps has responded to the “challenge to American security” from the Taliban. “We have to kill them over there before they come over here.” No member of the US government or its numerous well-paid agents has ever explained how the Taliban, which is focused on Afghanistan, could ever get to America. Yet this hyped fear is sufficient for the public to support the continuing enrichment of the military/security complex, while American homes are foreclosed by the banksters who have destroyed the retirement prospects of the US population.. According to Pentagon budget documents, by next year the cost of the war against Afghanistan will exceed the cost of the war against Iraq. According to a Nobel prize-winning economist and a budget expert at Harvard University, the war against Iraq has cost the American taxpayers $3 trillion, that is, $3,000 billion in out-of-pocket and already incurred future costs, such as caring for veterans. If the Pentagon is correct, then by next year the US government will have squandered $6 trillion dollars on two wars, the only purpose of which is to enrich the munitions manufacturers and the “security” bureaucracy. The human and social costs are dramatic as well and not only for the Iraqi, Afghan, and Pakistani populations ravaged by American bombs. Dahr Jamail reports that US Army psychiatrists have concluded that by their third deployment, 30 percent of American troops are mental wrecks. Among the costs that reverberate across generations of Americans are elevated rates of suicide, unemployment, divorce, child and spousal abuse, drug and alcohol addiction, homelessness and incarceration. http://www.truthout.org/051209J?n In the Afghan “desert of death” the Obama administration is constructing a giant military base. Why? What does the internal politics of Afghanistan have to do with the US? What is this enormous waste of resources that America does not have accomplishing besides enriching the American munitions industry? China and to some extent India are the rising powers in the world. Russia, the largest country on earth, is armed with a nuclear arsenal as terrifying as the American one. The US dollar’s role as reserve currency, the most important source of American power, is undermined by the budget deficits that result from the munition corporations’ wars and the bankster bailouts. Why is the US making itself impotent fighting wars that have nothing whatsoever to do with is security, wars that are, in fact, threatening its security? The answer is that the military/security lobby, the financial gangsters, and AIPAC rule. The American people be damned........
The US Military Industrial Complex is in Iraq and Afganistan because in such far away places it can operate and make billions behind the smoke and mirrors of its distance all while they make up an array of false reasons why it is all happening. The US military has obliterated Iraq's and Afganistan's people's and the infrastructure of those two countries, which keeps the military industrial complex in business with a " mission " that can be easily sold to the American Public. Also because the US will more and more be spending billions for energy to run its gigantic economy the Military Industrial Complex is being used by the elites to further their agenda of trying to garner and control the energy of the middle east by force and fraud. The American Public were warned by an earlier president of just how dangerous would be the prospect of an all powerful Military Industrial Complex and the War Corporations that would grow up around it. This war for profit machine is bleeding our country to death, but by and large the general public is completely blind to this reality. There does not exist enough resources available to the US, and fake or borrowed trillions to maintain this over extended and unsustainable folly for much longer. Nothing can stop the downward slide of US power that has begun. We dominated world oil supplies for a time, and therfore we were the dominate nation during that period. Those days are fading fast.
Who Rules America?
What do you suppose it is like to be elected president of the United States only to find that your power is restricted to the service of powerful interest groups? A president who does a good job for the ruling interest groups is paid off with remunerative corporate directorships, outrageous speaking fees, and a lucrative book contract. If he is young when he assumes office, like Bill Clinton and Obama, it means a long life of luxurious leisure. Fighting the special interests doesn’t pay and doesn’t succeed. On April 30 the primacy of special over public interests was demonstrated yet again. The Democrats’ bill to prevent 1.7 million mortgage foreclosures and, thus, preserve $300 billion in home equity by permitting homeowners to renegotiate their mortgages, was defeated in the Senate, despite the 60-vote majority of the Democrats. The banksters were able to defeat the bill 51 to 45. These are the same financial gangsters whose unbridled greed and utter irresponsibility have wiped out half of Americans’ retirement savings, sent the economy into a deep hole, and threatened the US dollar’s reserve currency role. It is difficult to imagine an interest group with a more damaged reputation. Yet, a majority of “the people’s representatives” voted as the discredited banksters instructed. Hundreds of billions of public dollars have gone to bail out the banksters, but when some Democrats tried to get the Senate to do a mite for homeowners, the US Senate stuck with the banks. The Senate’s motto is: “Hundreds of billions for the banksters, not a dime for homeowners.” If Obama was naive about well-intentioned change before the vote, he no longer has this political handicap. Democratic Majority Whip Dick Durbin acknowledged the voters’ defeat by the discredited banksters. The banks, Durbin said, “frankly own the place.” It is not difficult to understand why. Among those who defeated the homeowners bill are senators Jon Tester (Mont), Max Baucus (Mont), Blanche Lincoln (Ark), Ben Nelson (Neb), Many Landrieu (La), Tim Johnson (SD), and Arlan Specter (Pa). According to reports, the banksters have poured a half million dollars into Tester’s campaign funds. Baucus has received $3.5 million; Lincoln $1.3 million; Nelson $1.4 million; Landrieu $2 million; Johnson $2.5 million; Specter $4.5 million. The same Congress that can’t find a dime for homeowners or health care appropriates hundreds of billions of dollars for the military/security complex. The week after the Senate foreclosed on American homeowners, the Obama “change” administration asked Congress for an additional $61 billion dollars for the neoconservatives’ war in Iraq and $65 billion more for the neoconservatives’ war in Afghanistan. Congress greeted this request with a rousing “Yes we can!” The additional $126 billion comes on top of the $533.7 billion “defense” budget for this year. The $660 billion--probably a low-ball number--is ten times the military spending of China, the second most powerful country in the world. How is it possible that “the world’s only superpower” is threatened by the likes of Iraq and Afghanistan? How can the US be a superpower if it is threatened by countries that have no military capability other than a guerilla capability to resist invaders? These “wars” are a hoax designed to enrich the US armaments industry and to infuse the “security forces” with police powers over American citizenry. Not a dime to prevent millions of Americans from losing their homes, but hundreds of billions of dollars to murder Muslim women and children and to create millions of refugees, many of whom will either sign up with insurgents or end up as the next wave of immigrants into America. This is the way the American government works. And it thinks it is a “city on the hill, a light unto the world.” Americans elected Obama because he said he would end the gratuitous criminal wars of the Bush brownshirts, wars that have destroyed America’s reputation and financial solvency and serve no public interest. But once in office Obama found that he was ruled by the military/security complex. War is not being ended, merely transferred from the unpopular war in Iraq to the more popular war in Afghanistan. Meanwhile, Obama, in violation of Pakistan’s sovereignty, continues to attack “targets” in Pakistan. In place of a war in Iraq, the military/security complex now has two wars going in much more difficult circumstances. Viewing the promotion gravy train that results from decades of warfare, the US officer corps has responded to the “challenge to American security” from the Taliban. “We have to kill them over there before they come over here.” No member of the US government or its numerous well-paid agents has ever explained how the Taliban, which is focused on Afghanistan, could ever get to America. Yet this hyped fear is sufficient for the public to support the continuing enrichment of the military/security complex, while American homes are foreclosed by the banksters who have destroyed the retirement prospects of the US population.. According to Pentagon budget documents, by next year the cost of the war against Afghanistan will exceed the cost of the war against Iraq. According to a Nobel prize-winning economist and a budget expert at Harvard University, the war against Iraq has cost the American taxpayers $3 trillion, that is, $3,000 billion in out-of-pocket and already incurred future costs, such as caring for veterans. If the Pentagon is correct, then by next year the US government will have squandered $6 trillion dollars on two wars, the only purpose of which is to enrich the munitions manufacturers and the “security” bureaucracy. The human and social costs are dramatic as well and not only for the Iraqi, Afghan, and Pakistani populations ravaged by American bombs. Dahr Jamail reports that US Army psychiatrists have concluded that by their third deployment, 30 percent of American troops are mental wrecks. Among the costs that reverberate across generations of Americans are elevated rates of suicide, unemployment, divorce, child and spousal abuse, drug and alcohol addiction, homelessness and incarceration. http://www.truthout.org/051209J?n In the Afghan “desert of death” the Obama administration is constructing a giant military base. Why? What does the internal politics of Afghanistan have to do with the US? What is this enormous waste of resources that America does not have accomplishing besides enriching the American munitions industry? China and to some extent India are the rising powers in the world. Russia, the largest country on earth, is armed with a nuclear arsenal as terrifying as the American one. The US dollar’s role as reserve currency, the most important source of American power, is undermined by the budget deficits that result from the munition corporations’ wars and the bankster bailouts. Why is the US making itself impotent fighting wars that have nothing whatsoever to do with is security, wars that are, in fact, threatening its security? The answer is that the military/security lobby, the financial gangsters, and AIPAC rule. The American people be damned........
The US Military Industrial Complex is in Iraq and Afganistan because in such far away places it can operate and make billions behind the smoke and mirrors of its distance all while they make up an array of false reasons why it is all happening. The US military has obliterated Iraq's and Afganistan's people's and the infrastructure of those two countries, which keeps the military industrial complex in business with a " mission " that can be easily sold to the American Public. Also because the US will more and more be spending billions for energy to run its gigantic economy the Military Industrial Complex is being used by the elites to further their agenda of trying to garner and control the energy of the middle east by force and fraud. The American Public were warned by an earlier president of just how dangerous would be the prospect of an all powerful Military Industrial Complex and the War Corporations that would grow up around it. This war for profit machine is bleeding our country to death, but by and large the general public is completely blind to this reality. There does not exist enough resources available to the US, and fake or borrowed trillions to maintain this over extended and unsustainable folly for much longer. Nothing can stop the downward slide of US power that has begun. We dominated world oil supplies for a time, and therfore we were the dominate nation during that period. Those days are fading fast.
Wednesday, May 13, 2009
SC91-7
http://www.culturechange.org/cms/index.php?option=com_content&task=view&id=422&Itemid=1
Waking Up in a Former Empire at the End of the Industrial Age
......The reason that we are in a climate emergency -- in fact, a biological holocaust, as it was identified over 20 yrs ago -- is that the dominant Western, globalized culture has been in a "cultural trance," drunk on oil, living in a delusional bubble for about 60 years. Now, the question is, is it unkind or rude or unskillful to try to wake people up from their cultural trance and point out that we are endangering the future of our species, and many others, to remain asleep? Is it "mean" to wake somebody up to tell them that their house is on fire? A lot of people seem to think so. I’ve lost friends by trying to wake them up. Waking up at this time of the Great Turning from the industrial growth society to a life-sustaining way of life is painful. Many people still don’t want to know, don't want to think, because it would entail facing painful truths and making hard choices.........
......It seems that the hardest part of waking up at this time is facing the fact that it is too late to avoid the pain, suffering and loss that could have been forestalled, had humans collectively heeded the warnings. The warnings were and are rational and scientifically based. The denial of the warnings was and is irrational, based on false beliefs. Pointing out that the denial was collective and irrational causes some people to point the ‘shame and blame’ finger at those who make this point. Instead of allowing themselves to evaluate the truth of the statement, they whine, ‘You’re shaming and blaming us. That’s not healing. You’re being apocalyptic. We don’t want to hear it, and it’s your fault for not giving us the message of hope that we need.’ This is a common shoot-the-messenger response, in which people who don’t like the message blame, or ‘shoot,’ the messenger.
The message of ‘hope’ that is demanded is the hope that we don’t have to take responsibility for ourselves and our world by changing how we live, and what we preoccupy ourselves with. The hope that many people want is very conditional. They can only take hope if they are reassured that things will continue as they have been during these very extraordinary last few decades.
The cultural trance prevents people from recognizing that the reality of living on Earth is unconditional. Our survival depends upon facing the reality of the larger living system we depend upon, and that larger living system doesn’t make deals. We can’t bargain with it. We live within its jurisdiction. The Earth has been very patient. It has put up with a lot of abuse, but the biological life of living systems is quite fragile, very vulnerable to damage by machines. Living systems have limits and tipping points beyond which breakdown and/or evolution can occur. The limits to which we can push living systems have been in view for decades. Because the limits were ignored, we are now seeing and experiencing the tipping point stage, and systemic chaos can therefore be expected.
The reality is that, not only do we have to change the way we live, but we need to recognize our part in creating this necessity...........
...........This is the point where we are right now, collectively. The minority of visionary Cassandras is turning out to be correct. But that is small comfort since they/we are still facing the wrath – and the consequences – of the majority who rejected foresight, and want to blame somebody, scapegoat somebody. The stages of grief have to be worked through in the process of waking up: denial, anger, bargaining, depression, and finally acceptance. Coming out of denial, the next reaction for most people is anger.
But I hope you of future generations can have some sympathy and compassion for those who are just waking up, because the discrepancy between the dream they are coming out of and the reality they must face is quite enormous. Some people talk about how “we need a new story,” a new cosmology, and this is true as far as it goes. But there are two facts that belie the simplicity of that statement. One is that the new story is still in gestation and isn’t yet a ‘live birth.’ The other is that the gap between the cultural trance of the old story and the unfolding reality of the world has never – in the history of our species – been so wide as it has become in Western civilization. The American Dream, in particular, has been so disconnected from the reality of the Earth that waking up from it is truly a ‘rude awakening,’ as we say, that can seem traumatic. Although waking up may be most difficult for Americans, that dream has also entranced much of the rest of the world.
However, since I am an American, I can identify with the difficulty of waking up from the American Dream. I know from experience that it entails working through layers and layers of collective delusion: the sense of entitlement and security of being a citizen within the “greatest country the world has ever known”; the sense that our country is superior and can do no wrong, and that it is ‘exceptional’ and will not collapse like other civilizations and empires; the sense that America is entitled to take what it wants from the rest of the world – by force if necessary; the sense that living in the United States is an unsurpassable blessing for which we should be grateful; the sense that ‘we’ (Americans) are the best people; and the sense that loyalty to our country demands that we turn a blind eye to its wrongdoings and faults. These are the delusions of the citizens of empire, carried over from ancient tribalistic habitual patterns.
Just to wake up to the injustices, lies, and crimes of our empire, and to realize that our arrogant assumptions of entitlement and superiority are baseless, takes a lot of courage; for to face these things means we must step out of the herd, and leave the herd mentality of the majority behind. This is a necessary part of growing up.
But once we’ve woken up to the injustices of our empire, the next step in growing up and facing reality is the realization that our empire is faltering and failing; in fact, it is disintegrating. At this stage one peeks over the edge of the cloud or the cliff and begins to comprehend how far it is to the ground – how far we have to fall. This is where we truly begin to realize that we are living in a former empire at the end of the industrial age, and that ‘progress’ as we’ve known it is over. Then we begin to comprehend that the glories of the way of life we’ve taken for granted – the glamour, ease and convenience of the industrial age – can never, ever be repeated, because our civilization has stripped the Earth of the resources that are accessible through the use of fossil fuels, and fossil fuels are going away. As Richard Heinberg has detailed for us, we have reached “Peak Everything” and after the peak, the only way is down.
This “Long Descent” or “Long Emergency” – as John Michael Greer and James Howard Kunstler, respectively, have described it – is the future that the majority of citizens of former empires have not yet been able to face...........
Waking Up in a Former Empire at the End of the Industrial Age
......The reason that we are in a climate emergency -- in fact, a biological holocaust, as it was identified over 20 yrs ago -- is that the dominant Western, globalized culture has been in a "cultural trance," drunk on oil, living in a delusional bubble for about 60 years. Now, the question is, is it unkind or rude or unskillful to try to wake people up from their cultural trance and point out that we are endangering the future of our species, and many others, to remain asleep? Is it "mean" to wake somebody up to tell them that their house is on fire? A lot of people seem to think so. I’ve lost friends by trying to wake them up. Waking up at this time of the Great Turning from the industrial growth society to a life-sustaining way of life is painful. Many people still don’t want to know, don't want to think, because it would entail facing painful truths and making hard choices.........
......It seems that the hardest part of waking up at this time is facing the fact that it is too late to avoid the pain, suffering and loss that could have been forestalled, had humans collectively heeded the warnings. The warnings were and are rational and scientifically based. The denial of the warnings was and is irrational, based on false beliefs. Pointing out that the denial was collective and irrational causes some people to point the ‘shame and blame’ finger at those who make this point. Instead of allowing themselves to evaluate the truth of the statement, they whine, ‘You’re shaming and blaming us. That’s not healing. You’re being apocalyptic. We don’t want to hear it, and it’s your fault for not giving us the message of hope that we need.’ This is a common shoot-the-messenger response, in which people who don’t like the message blame, or ‘shoot,’ the messenger.
The message of ‘hope’ that is demanded is the hope that we don’t have to take responsibility for ourselves and our world by changing how we live, and what we preoccupy ourselves with. The hope that many people want is very conditional. They can only take hope if they are reassured that things will continue as they have been during these very extraordinary last few decades.
The cultural trance prevents people from recognizing that the reality of living on Earth is unconditional. Our survival depends upon facing the reality of the larger living system we depend upon, and that larger living system doesn’t make deals. We can’t bargain with it. We live within its jurisdiction. The Earth has been very patient. It has put up with a lot of abuse, but the biological life of living systems is quite fragile, very vulnerable to damage by machines. Living systems have limits and tipping points beyond which breakdown and/or evolution can occur. The limits to which we can push living systems have been in view for decades. Because the limits were ignored, we are now seeing and experiencing the tipping point stage, and systemic chaos can therefore be expected.
The reality is that, not only do we have to change the way we live, but we need to recognize our part in creating this necessity...........
...........This is the point where we are right now, collectively. The minority of visionary Cassandras is turning out to be correct. But that is small comfort since they/we are still facing the wrath – and the consequences – of the majority who rejected foresight, and want to blame somebody, scapegoat somebody. The stages of grief have to be worked through in the process of waking up: denial, anger, bargaining, depression, and finally acceptance. Coming out of denial, the next reaction for most people is anger.
But I hope you of future generations can have some sympathy and compassion for those who are just waking up, because the discrepancy between the dream they are coming out of and the reality they must face is quite enormous. Some people talk about how “we need a new story,” a new cosmology, and this is true as far as it goes. But there are two facts that belie the simplicity of that statement. One is that the new story is still in gestation and isn’t yet a ‘live birth.’ The other is that the gap between the cultural trance of the old story and the unfolding reality of the world has never – in the history of our species – been so wide as it has become in Western civilization. The American Dream, in particular, has been so disconnected from the reality of the Earth that waking up from it is truly a ‘rude awakening,’ as we say, that can seem traumatic. Although waking up may be most difficult for Americans, that dream has also entranced much of the rest of the world.
However, since I am an American, I can identify with the difficulty of waking up from the American Dream. I know from experience that it entails working through layers and layers of collective delusion: the sense of entitlement and security of being a citizen within the “greatest country the world has ever known”; the sense that our country is superior and can do no wrong, and that it is ‘exceptional’ and will not collapse like other civilizations and empires; the sense that America is entitled to take what it wants from the rest of the world – by force if necessary; the sense that living in the United States is an unsurpassable blessing for which we should be grateful; the sense that ‘we’ (Americans) are the best people; and the sense that loyalty to our country demands that we turn a blind eye to its wrongdoings and faults. These are the delusions of the citizens of empire, carried over from ancient tribalistic habitual patterns.
Just to wake up to the injustices, lies, and crimes of our empire, and to realize that our arrogant assumptions of entitlement and superiority are baseless, takes a lot of courage; for to face these things means we must step out of the herd, and leave the herd mentality of the majority behind. This is a necessary part of growing up.
But once we’ve woken up to the injustices of our empire, the next step in growing up and facing reality is the realization that our empire is faltering and failing; in fact, it is disintegrating. At this stage one peeks over the edge of the cloud or the cliff and begins to comprehend how far it is to the ground – how far we have to fall. This is where we truly begin to realize that we are living in a former empire at the end of the industrial age, and that ‘progress’ as we’ve known it is over. Then we begin to comprehend that the glories of the way of life we’ve taken for granted – the glamour, ease and convenience of the industrial age – can never, ever be repeated, because our civilization has stripped the Earth of the resources that are accessible through the use of fossil fuels, and fossil fuels are going away. As Richard Heinberg has detailed for us, we have reached “Peak Everything” and after the peak, the only way is down.
This “Long Descent” or “Long Emergency” – as John Michael Greer and James Howard Kunstler, respectively, have described it – is the future that the majority of citizens of former empires have not yet been able to face...........
SC91-6
http://www.ricefarmer.blogspot.com/
Renewable Energy Infrastructure: A Problem
Here I want to build on the previous post with an observation about renewable energy.
The plan is to replace fossil fuels by using other energy sources, with renewables being a major component. Or maybe the biggest component. That’s why everyone is calling for lots of investment in renewables, including construction of facilities and research into other potential kinds of renewables.
I’m all in favor of building all we can and as soon as we can, but there is a pitfall that almost everyone seems to be overlooking. All the infrastructure we are building now, and proposing to build in the future, needs to be maintained. Machines wear out and break down. Solar panels need to be washed. Renewable energy infrastructure also requires ancillary facilities, such as access roads, which also need to be maintained. All this infrastructure will be added on to the infrastructure we already have in place. Now you can see the problem: We have arrived at the point where we cannot maintain existing infrastructure, but the push for renewables will add still more, thereby increasing the already too-heavy burden. Competition for maintenance will just keep increasing as the energy available for maintenance is decreasing.
I can already see the visions of a Glorious Technological Future melting like ice cream on a hot summer day.
Renewable Energy Infrastructure: A Problem
Here I want to build on the previous post with an observation about renewable energy.
The plan is to replace fossil fuels by using other energy sources, with renewables being a major component. Or maybe the biggest component. That’s why everyone is calling for lots of investment in renewables, including construction of facilities and research into other potential kinds of renewables.
I’m all in favor of building all we can and as soon as we can, but there is a pitfall that almost everyone seems to be overlooking. All the infrastructure we are building now, and proposing to build in the future, needs to be maintained. Machines wear out and break down. Solar panels need to be washed. Renewable energy infrastructure also requires ancillary facilities, such as access roads, which also need to be maintained. All this infrastructure will be added on to the infrastructure we already have in place. Now you can see the problem: We have arrived at the point where we cannot maintain existing infrastructure, but the push for renewables will add still more, thereby increasing the already too-heavy burden. Competition for maintenance will just keep increasing as the energy available for maintenance is decreasing.
I can already see the visions of a Glorious Technological Future melting like ice cream on a hot summer day.
Sunday, May 10, 2009
SC91-5
http://www.globalresearch.ca/index.php?context=va&aid=13551
The Nature of the Current Financial Crisis: The System is designed to exert Total Control over the Lives of Individuals
What impresses me in the current financial crisis is the near-total failure of so-called progressives to appreciate the magnitude of what is going on or the level of intelligence behind it. How many will say, for instance, that the crash was deliberately engineered by the creation, then destruction, of the investment bubbles of the last decade?
When the financial system creates bubbles it drives up the cost of assets far beyond their true value in producing or storing wealth. When the bubbles burst the value of the assets plummets. Those with ready cash then buy them up on the cheap. When the dust settles more wealth has been concentrated in fewer hands. The rich get richer, and ordinary people are left in a deeper condition of indebtedness, poverty, and pressure to perform to the liking of the financial masters.
Progressives think the system needs to be “reformed.” Maybe the banking system needs to be re-regulated or even nationalized. Maybe it should be possible for families facing loss of their homes to get a lower monthly payment from a bankruptcy court. Maybe the government instead of the private sector should administer student loans.
What we fail to acknowledge is that the system itself is totalitarian. This means that it is designed to exert total control over the lives of individuals. We are accustomed to use this label when thinking of anachronisms of history like communism or fascism. We do not understand that globalist finance capitalism and the government which protects, enables, or even regulates it are also totalitarian.
What has happened in the last year as the financial system has seemingly gone belly-up, and is coming back only through massive government bailouts, is part of a pattern that has been around for decades if not centuries. How the controllers work was laid out in 1967 when Dial Press published a leaked copy of The Report from Iron Mountain. This was a study put together by a team of academics and analysts who met at the underground facility in New York that was home to the Hudson Institute.
The report began by identifying war as the central organizing principle of society. It stated, “War itself is the basic social system, within which other secondary modes of social organization conflict or conspire. It is the system which has governed most human societies of record, as it is today.”
The report said that, “The basic authority of a modern state over its people resides in its war powers.” It said that any failure of will by the ruling class could lead to “actual disestablishment of military institutions.” The effect on the system would be, the report said, “catastrophic.”
The appearance of the report caused a sensation when it came out at the onset of the Vietnam War. Officials within the government had no comment, and the report faded into history. But certain of its sections fit the situation in 2009 precisely.
This is because the report outlined the ways the civilian population of a developed nation could be controlled even in the absence of a large-scale war that disrupted their daily lives. One of these ways was defined as follows: “A…possible surrogate for the control of potential enemies of society is the reintroduction, in some form consistent with modern technology and political process, of slavery….The development of a sophisticated form of slavery may be an absolute prerequisite for social control….” (Cited in Rule by Secrecy by Jim Marrs, 2000.)
We see the development of such a “sophisticated form of slavery” today. What else can a system be called that subjects the population to skyrocketing personal and household debt, a widening gap between the rich and everyone else, constant warfare " justified " as necessary to fight “terrorism,” erosion of personal freedoms, constantly expanding power allocated to the military and police, pervasive electronic eavesdropping, complete lack of accountability by politicians for their dishonesty and crimes, a mass media devoted solely to establishment propaganda, etc.
None of this seems to be diminishing under the Barack Obama administration. Even the economic recovery Obama is attempting to engineer through massive Keynesian deficit spending is expected by economists to be another “jobless” one like that of 2002-2005. Of course the unemployed or those who fear unemployment are easy to control. And the permanent series of Asian land wars George W. Bush instigated for control of resources and geopolitical leverage against Russia and China continue unabated.
None of this is accidental. As The Report from Iron Mountain made clear four decades ago, it’s what has been planned all along.
The Nature of the Current Financial Crisis: The System is designed to exert Total Control over the Lives of Individuals
What impresses me in the current financial crisis is the near-total failure of so-called progressives to appreciate the magnitude of what is going on or the level of intelligence behind it. How many will say, for instance, that the crash was deliberately engineered by the creation, then destruction, of the investment bubbles of the last decade?
When the financial system creates bubbles it drives up the cost of assets far beyond their true value in producing or storing wealth. When the bubbles burst the value of the assets plummets. Those with ready cash then buy them up on the cheap. When the dust settles more wealth has been concentrated in fewer hands. The rich get richer, and ordinary people are left in a deeper condition of indebtedness, poverty, and pressure to perform to the liking of the financial masters.
Progressives think the system needs to be “reformed.” Maybe the banking system needs to be re-regulated or even nationalized. Maybe it should be possible for families facing loss of their homes to get a lower monthly payment from a bankruptcy court. Maybe the government instead of the private sector should administer student loans.
What we fail to acknowledge is that the system itself is totalitarian. This means that it is designed to exert total control over the lives of individuals. We are accustomed to use this label when thinking of anachronisms of history like communism or fascism. We do not understand that globalist finance capitalism and the government which protects, enables, or even regulates it are also totalitarian.
What has happened in the last year as the financial system has seemingly gone belly-up, and is coming back only through massive government bailouts, is part of a pattern that has been around for decades if not centuries. How the controllers work was laid out in 1967 when Dial Press published a leaked copy of The Report from Iron Mountain. This was a study put together by a team of academics and analysts who met at the underground facility in New York that was home to the Hudson Institute.
The report began by identifying war as the central organizing principle of society. It stated, “War itself is the basic social system, within which other secondary modes of social organization conflict or conspire. It is the system which has governed most human societies of record, as it is today.”
The report said that, “The basic authority of a modern state over its people resides in its war powers.” It said that any failure of will by the ruling class could lead to “actual disestablishment of military institutions.” The effect on the system would be, the report said, “catastrophic.”
The appearance of the report caused a sensation when it came out at the onset of the Vietnam War. Officials within the government had no comment, and the report faded into history. But certain of its sections fit the situation in 2009 precisely.
This is because the report outlined the ways the civilian population of a developed nation could be controlled even in the absence of a large-scale war that disrupted their daily lives. One of these ways was defined as follows: “A…possible surrogate for the control of potential enemies of society is the reintroduction, in some form consistent with modern technology and political process, of slavery….The development of a sophisticated form of slavery may be an absolute prerequisite for social control….” (Cited in Rule by Secrecy by Jim Marrs, 2000.)
We see the development of such a “sophisticated form of slavery” today. What else can a system be called that subjects the population to skyrocketing personal and household debt, a widening gap between the rich and everyone else, constant warfare " justified " as necessary to fight “terrorism,” erosion of personal freedoms, constantly expanding power allocated to the military and police, pervasive electronic eavesdropping, complete lack of accountability by politicians for their dishonesty and crimes, a mass media devoted solely to establishment propaganda, etc.
None of this seems to be diminishing under the Barack Obama administration. Even the economic recovery Obama is attempting to engineer through massive Keynesian deficit spending is expected by economists to be another “jobless” one like that of 2002-2005. Of course the unemployed or those who fear unemployment are easy to control. And the permanent series of Asian land wars George W. Bush instigated for control of resources and geopolitical leverage against Russia and China continue unabated.
None of this is accidental. As The Report from Iron Mountain made clear four decades ago, it’s what has been planned all along.
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