http://www.truthdig.com/report/item/police_killings_wont_stop_20160925
Police Killings Won’t Stop
The corporate state, no matter how many protests take place in American cities over the murder of unarmed citizens, will put no restraints on the police or the organs of security and surveillance. It will not protect the victims of state violence. It will continue to grant broader powers and greater resources to militarized police departments and internal security forces such as Homeland Security. Force, along with the systems of indoctrination and propaganda, is the last prop that keeps the corporate elites in power. These elites will do nothing to diminish the mechanisms necessary for their control.
The corporate state, by pillaging the nation, has destroyed capitalism’s traditional forms of social control. The population is integrated into a capitalist democracy by decent wages and employment opportunities, labor unions, mass-produced consumer products, a modest say in governance, mechanisms for marginal reform, pensions, affordable health care, a judiciary that is not utterly subservient to the elites and corporate power, the possibility for social, political and economic advancement, good public education, arts funding and a public broadcasting system that gives a platform to those who are not in service to the elites. These elements make possible the common good, or at least the perception of the common good.
Global capitalism, however, is not concerned with the cohesion of the nation-state. The relentless quest for profit trumps internal stability. Everything and everyone is pillaged and harvested for profit. Democracy is a mirage, a useful fiction to keep the population passive and compliant. Propaganda, including entertainment and spectacle, and coercion through state-administered surveillance and violence are the primary tools of governance. This is why, despite years of egregious police violence, there is no effective reform.
Propaganda is not solely about instilling an opinion. It is also about appropriating the aspirations of the citizenry into the vocabulary of the power elite. The Clintons and Barack Obama built their careers mastering this duplicity. They speak in words that reflect the concerns of the citizenry, while pushing through programs and legislation that mock those concerns. This has been especially true in the long campaign to curb excessive police force. The liberal elites preach “tolerance” and “professionalism” and promote “diversity.” But they do not challenge the structural racism and economic exploitation that are the causes of our crisis. They treat the abuses of corporate oppression as if they were minor administrative defects rather than essential components of corporate power.
Naomi Murakawa in her book “The First Civil Right: How Liberals Built Prison America” documents how the series of “reforms” enacted to professionalize police departments resulted in placing more money and resources into the hands of the police, giving them greater power to act with impunity and expanding legally sanctioned violence. All penal reform, from President Harry Truman’s 1947 Committee on Civil Rights report to the Safe Streets Act of 1968 to the Sentencing Reform Act of 1984 to contemporary calls for more professionalization, have, she notes, only made things worse.
The fiction used to justify expanded police powers, a fiction perpetrated by Democratic politicians such as Bill Clinton and Obama, is that a modernized police will make possible a just and post-racial America. White supremacy, racism and corporate exploitation, however, are built into the economic model of neoliberalism and our system of “inverted totalitarianism.” A discussion about police violence has to include a discussion of corporate power. Police violence is one of the primary pillars that allow the corporate elites to retain power. That violence will end only when the rule of these elites ends.
The calls for more training and professionalization, the hiring of minority police officers, the use of body and dash cameras, improving procedures for due process, creating citizen review boards, even the reading of Miranda rights, have done nothing to halt the indiscriminate use of lethal violence and abuse of constitutional rights by the police and courts. Reforms have served only to bureaucratize, professionalize and legalize state abuse and murder. Innocent men and women may no longer be lynched on a tree, but they are lynched on death row and in the streets of New York, Baltimore, Ferguson, Charlotte and dozens of other cities. They are lynched for the reasons poor black people have always been lynched—to create a reign of terror that serves as an effective form of social control.
The wreckage left behind by deindustrialization created a dilemma for the corporate state. The vast pools of “surplus” or “redundant” labor in our former manufacturing centers meant the old forms of social control had disappeared. The corporate state needed harsher mechanisms to subjugate a population it condemned as human refuse. Those on probation and parole or in jails or prisons grew from 780,000 in 1965 to 7 million in 2010. The kinds of federal crimes punishable by death leaped from one in 1974 to 66 in 1994, thanks to the Clinton administration. The lengths of prison sentences tripled and quadrupled. Laws were passed to turn inner-city communities into miniature police states. This had nothing to do with crime.
Amiri Baraka, the author of the incendiary poem “Somebody Blew Up America,” understood. In that poem he called us to examine the epicenters of capitalist power and the dark heart of imperialism. He knew the organs of state security served not only a corporate system but also a dehumanizing ideology. It is the system and the ideology that are the evils. The police are only its most visible and public instruments of oppression.
In this excerpt from the poem, Baraka asked:
Who stole Puerto Rico
Who stole the Indies, the Philippines, Manhattan
Australia & The Hebrides
Who forced opium on the Chinese
Who own them buildings
Who got the money
Who think you funny
Who locked you up
Who own the papers
Who owned the slave ship
Who run the army
Who the fake president
Who the ruler
Who the banker
Who? Who? Who?
Who own the mine
Who twist your mind
Who got bread
Who need peace
Who you think need war
Who own the oil
Who do no toil
Who own the soil
Who is not a nigger
Who is so great ain’t nobody bigger
Who own this city
Who own the air
Who own the water
Who own your crib
Who rob and steal and cheat and murder
and make lies the truth
Who call you uncouth
Who live in the biggest house
Who do the biggest crime
State-administered violence is all that lies between the corporate state and widespread unrest. The power elites know it. They also know that as this unrest begins to define the white underclass, the legal and physical shackles perfected for poor people of color can easily be expanded. Rights in America have become privileges. And the corporate state has created legal mechanisms, including the loss of our right to privacy, to remove these privileges the instant it feels threatened.
Liberals’ rhetoric of compassion is as destructive as conservatives’ call for law and order. The liberal stances are patronizing. They reduce structural and economic oppression to personal and psychological problems, as if we can solve police murder by training and empowering “good” people, supporting families or rewriting regulations. As long as our discussion of police violence ignores the social functions of police and prisons, the elites have nothing to fear. The police, in the end, are not the problem. They, like the military, are the foot soldiers for the corporate leviathan.
The corporate state needs to create the illusion that the courts and the police are impartial and just. Once this illusion is cemented into the public consciousness, victims can be blamed for their oppression. Institutionalized murder becomes acceptable. Police violence becomes part of the cost of keeping us safe. The oppressed have no legitimacy or voice.
The corporate state is interested only in fostering these illusions. Reforms will be, as they have been in the past, cosmetic. What advances have we made since police murdered Michael Brown two years ago in Ferguson? Have the some 200 civilian review boards across the country, most of them toothless and ineffectual, prevented police from gunning down people in our streets or brought the killers to justice? Police have killed over 700 people this year. The illusions of reform are used to alter public consciousness rather than the machinery of corporate power. These illusions are created to reassure us that those that are arrested, beaten, killed or sent away to prison for decades deserve their fate. Yes, the state may admit, there is an abuse committed here or an injustice committed there, but the system itself, the state insists, is fundamentally fair and just. This is a lie the elites go to tremendous lengths to disseminate.
The corporate state is counting on counterviolence against police, which is inevitable, and further acts of domestic terrorism, which also are inevitable. Acts of violence directed against the state are used by the organs of state propaganda, including the corporate press, to foster a culture of fear, to deify the police and to demonize the oppressed in our inner cities and in the Middle East. All criticism of excessive state violence, once these illusions dominate the society, will be condemned as disloyal and unpatriotic. The corporate state, until it is destroyed, will do what it is designed to do—kill with impunity.
Wednesday, September 28, 2016
Wednesday, September 21, 2016
SC136-15
https://ourfiniteworld.com/2016/09/20/why-really-causes-falling-productivity-growth-an-energy-based-explanation/
What really causes falling productivity growth — an energy-based explanation
What really causes falling productivity growth? The answer seems to be very much energy-related. Human labor by itself does not cause productivity growth. It is human labor, leveraged by various tools, that leads to productivity growth. These tools are made using energy, and they often use energy to operate. A decrease in energy consumption by the business sector can be expected to lead to falling productivity growth. In this post, I will explain why such a pattern can be expected, and show that, in fact, such a pattern is happening in the United States.
Figure 4. Total amount of energy used by Commercial and Industrial Sector (excluding transportation) based on EIA Energy Consumption by Sector, divided by Bureau of Labor Statistics Total Non-Farm Employees by Year.
Preview of Figure 4. Total quantity of per capita energy used by the US Commercial and Industrial Sectors (excluding transportation). Computed by dividing EIA Energy Consumption by Sector by Total Non-Farm Employment from the Bureau of Labor Statistics.
Background
The problem of falling productivity growth seems to be a concern to many economists. An August Wall Street Journal article is titled, Productivity Slump Threatens Economy’s Long-Term Growth. The article says, “Productivity is a key ingredient in determining future growth in wages, prices and overall economic output.”
The general trend in falling productivity growth does not seem to be particularly recent. OECD data shows a long-term pattern of slowing productivity growth, dating back to the 1970s for many developed economies.
Figure 1. Five-year average growth in productivity based on OECD data
Figure 1. Five-year average growth in productivity per hour worked based on OECD data.
Falling productivity can be expected to affect wages. Figure 2 shows that in the United States, wages for both low and high paid workers increased much faster than inflation between 1948 and 1968. Between 1968 and 1981, wages for both sets of workers stopped rising. After 1981, wages for high paid workers (“Top 10 percent”) have risen much faster than for the bottom 90%. This reflects the way this lower productivity has been distributed to the work force. Low-wage workers have been affected to a much greater extent than high-wage workers.
Figure 2. Chart comparing income gains by the top 10% to income gains by the bottom 90% by economist Emmanuel Saez. Based on an analysis IRS data, published in Forbes.
Figure 2. Chart comparing income gains by the top 10% to income gains by the bottom 90% by economist Emmanuel Saez. Based on an analysis of IRS data, published in Forbes.
A Major Culprit in Falling Productivity Seems to Be Diminishing Returns with Respect to Oil Extraction
Many people believe that the only oil problem we need to worry about is the possibility that supply will “run out” at some point in the future. In my opinion, the real problem is different. What we are experiencing is diminishing marginal returns with respect to oil supply. In other words, it is becoming increasingly expensive to extract and process oil. Total costs, including wages for human labor, the cost of capital, the cost of energy to extract the oil, and required tax payments, are rising ever higher. Businesses are finding it nearly impossible to earn a reasonable profit extracting oil. If oil producers want to cover all of their costs, they need to borrow an increasing amount of money simply to cover normal business expenses, including the development of new fields (to replace currently depleting fields) and the payment of dividends.
Figure 3. Bloomberg exhibit showing that returns for three large oil companies on a "cash" basis fell after 2008, and are now at 50-year lows. CROCI means "Cash Return On Capital Invested." Bloomberg source.
Figure 3. Bloomberg exhibit showing that returns for three large oil companies on a “cash” basis fell after 2008, and are now at 50-year lows. CROCI means “Cash Return On Capital Invested.” Bloomberg source.
The problem of diminishing marginal returns extends to other commodity types as well, such as coal, natural gas, fresh water, and metals. Oil is especially important, because it is energy-dense and easy to transport, making it the world’s most-used fossil fuel. At the same time, we are experiencing rising costs for pollution control of various kinds, including attempts to prevent climate change.
The combination of diminishing returns for commodity production together with rising pollution control costs tends to make the world economy increasingly inefficient. This increased inefficiency affects the cost of producing many things that consumers value, including food, fresh water, housing, and transportation. Indirectly, the ability of businesses to create jobs that pay well is affected, also. I believe that this growing inefficiency in producing goods and services is the basis for the falling growth in productivity that appears in Figure 1.
Why Diminishing Returns with Respect to Energy Supplies Are Likely to be the Culprit in Falling Productivity
There are several basic issues that make our economy vulnerable to the impacts of diminishing returns:
Energy plays a critical role in creating goods and services, and thus in economic growth.
Energy that is very inexpensive to produce is important in setting up a benevolent cycle of greater productivity and more economic growth.
Diminishing returns for oil and other energy products lead to higher costs of production. If these higher costs of production are passed through to the consumer as higher prices, this leads to what we think of as a recession, and a slow-down in economic growth.
The timing of falling productivity “matches up” with falling energy consumption on the part of employers, and also with high oil prices.
Energy plays a critical role in economic growth because energy is necessary for all kinds of economic activity. Energy allows transportation to take place; it allows heating to take place, so metals can be smelted and chemical reactions of many kinds can take place; it allows the use of computers and the internet. When workarounds for problems are needed–for example, increased pollution control, or deeper wells, or desalination plants–all of these workarounds also require the use of energy products. So, the problem is not simply that it takes more fossil fuel energy to create energy products. Many other parts of the economy, including pollution control and extraction of fresh water and minerals, become more demanding of energy supplies as well.
Cheap-to-produce oil and other types of energy are important in setting up a cycle of economic growth. We think of productivity growth as being something that an employee is able to do. In fact, productivity growth is enabled by the use of “tools” that the employer (or the government) gives workers, allowing these workers to create more goods and services per hour worked. These tools can be either physical tools, such as machinery, computers, vehicles, and roads, or they can be tools provided through more specialization and training. In the case of physical tools, it is clear that energy is used both to create and operate the tools. In the case of specialization, energy is needed in a more indirect way; extra energy allows the economy to have sufficient surpluses to permit training of specialized workers, and also to allow them to have higher wages later.
Thus, we can think of human labor as being increasingly leveraged by energy-related tools. In fact, if we divide energy consumption of businesses (commercial and industrial) by the total number of non-farm employees in the United States, we find that energy consumption per employee falls very much according to the pattern we might expect, based on the rise and then fall in productivity growth shown in Figures 1 and 2. A slowdown in energy leveraging seems to correlate with the decline in the rate of productivity growth.
Figure 4. Total amount of energy used by Commercial and Industrial Sector (excluding transportation) based on EIA Energy Consumption by Sector, divided by Bureau of Labor Statistics Total Non-Farm Employees by Year.
Figure 4. Total quantity of per capita energy used by the US Commercial and Industrial Sectors (excluding transportation). Computed by dividing EIA Energy Consumption by Sector by Total Non-Farm Employment from the Bureau of Labor Statistics.
Figure 4 shows that energy consumption per employee reached a peak in 1973. Energy consumption per employee started falling in 1974. This date corresponds to the first major run-up in oil prices (Figure 5). Oil prices, on an inflation-adjusted basis, have never returned to the very low level experienced prior to 1973.
Figure 4. Historical annual average price of oil, for a grade of crude similar to "Brent," based on data of 2016 BP Statistical Review of World Energy.
Figure 5. Historical annual average price of oil, for a grade of crude similar to “Brent,” based on data of 2016 BP Statistical Review of World Energy.
The period between the end of World War II and the early 1970s was generally a period in which inflation-adjusted oil prices were under $20 per barrel. At this very low price level, it made sense to add a new interstate highway system and to greatly upgrade the electric grid and the oil pipeline distribution systems. Once oil became high-priced, the US greatly backed away from leveraging worker productivity with such big projects. Other changes began as well, including gradually shifting manufacturing to other countries. These countries typically had lower labor costs and a cheaper energy mix (more coal and hydroelectric, and less oil).
The first run-up in prices occurred after US oil supply reached a peak in 1970 (Figure 5). According to a presentation by Steve Kopits, the second run-up in prices started occurring about 1999 (Figure 6). By then, we reached a point where a disproportionate share of the cheap-to-extract oil had already been removed. Oil producers needed to start work on new oil fields in areas where extraction costs were higher.
Figure 5. Figure by Steve Kopits of Westwood Douglas showing trends in world oil exploration and production costs per barrel. CAGR is "Compound Annual Growth Rate."
Figure 6. Figure by Steve Kopits of Westwood Douglas showing trends in world oil exploration and production costs per barrel. CAGR is “Compound Annual Growth Rate.”
Oil’s diminishing returns affect the economy. As we reach diminishing returns with respect to oil production, the cost of producing additional barrels of oil tends to increase. If this higher cost is passed on to goods made directly and indirectly with oil products, we find that the prices of many products rise. Food costs are particularly affected, because oil is used extensively in agriculture and in transporting goods to market. Higher oil prices affect the cost of other types of goods, because many goods–even coal–are transported using oil. The higher cost of oil tends to ripple throughout the entire economy.
The problem, however, is that higher oil costs lead to lower productivity, because employers and governments tend to purchase fewer energy products for the benefit of their workers when oil prices are high. We end up with a mismatch:
The cost of oil products, and many other products, tends to rise.
The productivity of workers tends to grow more slowly. Wages rise very slowly, if at all. They certainly do not keep up with soaring oil prices.
The result of this mismatch is recession, as occurred in the 2007-2009 period. Economist James Hamilton has shown that 10 out of 11 post-World War II recessions were associated with oil price spikes. A 2004 IEA report states, “. . . a sustained $10 per barrel increase in oil prices from $25 to $35 would result in the OECD as a whole losing 0.4% of GDP in the first and second years of higher prices. Inflation would rise by half a percentage point and unemployment would also increase.”
A Second Way Diminishing Returns Can Work Out Badly: Prices that Are Too Low and Oversupply
In the preceding section, I explained how oil prices, if passed on to the consumer via higher prices of other goods, could lead to recession. Because our economy is a networked system, the situation doesn’t need to work this way to come out badly. There is an alternative scenario in which oil prices stay too low for businesses extracting oil to make an adequate profit. In this scenario, it is businesses, rather than consumers, who find that they have a huge financial problem. This is the problem we are encountering now. In fact, it is not just oil-producers who have a profitability problem; the profitability problem extends to businesses producing coal, natural gas, metals, and many kinds of agricultural commodities.
The reason why this kind of low-price scenario can take place (despite rising costs) is because workers are also consumers. We saw in Figure 2 that the wages of the lower 90% of workers tend to lag behind when energy consumption per worker is falling. There are a very many workers in the bottom 90%. If the wages of these workers lag behind, homes, cars, vacations, and many other kinds of discretionary goods become less affordable. The reduced demand for these finished products leads to lower demand for a wide range of commodities. This lower demand tends to push commodity prices of many kinds lower, even though the cost of production is rising. As a result, profits for a wide range of commodity producers tend to fall in a way similar to that shown in Figure 3.
It may be that we can expect a recessionary impact, a short time after profits fall. According to Deutsche Bank:
Profit margins always peak in advance of recession. Indeed, there has not been one business cycle in the post-WWII era where this has not been the case. The reason margins are a leading indicator is simple: When corporate profitability declines, a pullback in spending and hiring eventually ensues.
The article goes on to show that there is a lag of about two years between the time of profit compression and the time when recession hits. The amount of variability is quite high, with one recession coming as soon as 4 quarters after a fall in profitability, and two coming as late as 15 or 16 quarters after a fall in profits. The median lag was 8 quarters, and the average lag was 9 quarters.
This Deutsche Bank description of the cause of recessions gives an explanation why Hamilton encountered recessions after oil price spikes. These rising oil prices affected one of the costs of production for most companies. These rising costs compressed profits, and eventually led to recession.
This description of the cause of recession shows how recession can also ensue if commodity prices remain too low for an extended period. We know that oil prices began falling in the third quarter of 2014. It is now two years later. Profit margins of many commodity producers have been squeezed. We have already seen layoffs in the oil and coal industries. In this low-priced situation, companies are affected unevenly: some benefit from low prices, while others are hurt by low prices.
Commodities are often essential to economies, especially for countries that export commodities. These exporters are especially likely to be affected by low prices. Impacts are likely to include civil disorder and falling production, similar to what we are now seeing in Venezuela.
Oil importers are dependent on oil exporters, so eventually oil imports must drop. Low oil prices are likely to lead to a drop in locally produced oil products as well. As a result, we can expect that less oil and fewer other energy products will be available for leveraging the labor of human workers. If past patterns hold, we can expect a further decline in productivity growth. Rising oil prices are not really a solution either, because, as we have seen, they tend to lead to recession.
Diminishing Marginal Returns Don’t Just Go Away by Themselves
Economists claim that the law of diminishing marginal returns operates only in the short run, because in the long run, all factors of production are variable. This statement might be true, if we lived in a world without limits. In fact, the amount of arable land is very close to fixed. We have not found a way to stop population growth, either. As a result, the amount of arable land per person is falling. We need to keep finding ways to produce increasing amounts of food per arable acre of land. Doing so typically requires energy products, including oil.
We are having similar problems with fresh water supply. We can solve our falling fresh water per capita problem with deeper wells, long-distance transport, or desalination. Any of these workarounds requires energy products.
Of course, we have had diminishing returns with respect to oil supply since the 1970s. We have not yet found a reasonable workaround. Intermittent electricity is not a reasonable substitute; it does not power existing airplanes, trucks and most cars. When all costs are considered, intermittent electricity tends to be very expensive. Experience shows that if subsidies are given for intermittent electricity, they are needed for other types of electricity generation as well.
Figure 7. Figure by Euan Mearns showing relationship between installed wind + solar capacity and European electricity rates. Source Energy Matters.
Figure 7. Figure by Euan Mearns showing relationship between installed wind + solar capacity and European electricity rates. Source Energy Matters.
The belief that diminishing marginal returns are temporary is probably related to the belief that there are substitutes for everything, including energy supplies. Unfortunately, this is not the case; the laws of thermodynamics dictate otherwise.
As a result, when businesses use falling amounts of energy per capita, we should not be surprised if productivity lags, and if wages for many workers barely rise with inflation. It is possible to get some productivity gains through education, but it is very unlikely that these gains are as large as when more capital goods are used, as well as more direct use of energy. There are also clearly diminishing returns with respect to education and training; for example, if we need 10,000 additional dentists per year, training 50,000 additional dentists per year would not be helpful.
Can We Solve Our Productivity Problem with Lower Interest Rates, or with Increased Deficit Spending?
I wouldn’t count on it. Our problem is an energy problem.
Increased deficit spending could perhaps raise commodity prices a bit, and thus help the profitability of companies producing commodities. The reason commodity prices might rise is because increased spending by governments would act to supplement the low spending by workers who are suffering from low growth in wages. The sale of goods might rise for a while, but productivity of workers would still lag. Economic growth would, at best, remain very slow. If the economy were headed for recession or the collapse of commodity exporters, that situation would continue to be the case.
Lower interest rates would likely be even less helpful than deficit spending. There is no guarantee that these low interest rates would lead to increased spending on capital goods that would benefit workers. Banks in Europe and Japan would likely have even more problem with adequate profitability than they do now. Bank failure would become even more of a concern than it is now.
Our problem is really a lack of very cheap-to-produce energy that can be used to inexpensively leverage the labor of human workers. This energy needs to be of the correct kind to match the requirements of existing equipment. Without this leveraging, it is likely to be impossible to fix our productivity problem.
What really causes falling productivity growth — an energy-based explanation
What really causes falling productivity growth? The answer seems to be very much energy-related. Human labor by itself does not cause productivity growth. It is human labor, leveraged by various tools, that leads to productivity growth. These tools are made using energy, and they often use energy to operate. A decrease in energy consumption by the business sector can be expected to lead to falling productivity growth. In this post, I will explain why such a pattern can be expected, and show that, in fact, such a pattern is happening in the United States.
Figure 4. Total amount of energy used by Commercial and Industrial Sector (excluding transportation) based on EIA Energy Consumption by Sector, divided by Bureau of Labor Statistics Total Non-Farm Employees by Year.
Preview of Figure 4. Total quantity of per capita energy used by the US Commercial and Industrial Sectors (excluding transportation). Computed by dividing EIA Energy Consumption by Sector by Total Non-Farm Employment from the Bureau of Labor Statistics.
Background
The problem of falling productivity growth seems to be a concern to many economists. An August Wall Street Journal article is titled, Productivity Slump Threatens Economy’s Long-Term Growth. The article says, “Productivity is a key ingredient in determining future growth in wages, prices and overall economic output.”
The general trend in falling productivity growth does not seem to be particularly recent. OECD data shows a long-term pattern of slowing productivity growth, dating back to the 1970s for many developed economies.
Figure 1. Five-year average growth in productivity based on OECD data
Figure 1. Five-year average growth in productivity per hour worked based on OECD data.
Falling productivity can be expected to affect wages. Figure 2 shows that in the United States, wages for both low and high paid workers increased much faster than inflation between 1948 and 1968. Between 1968 and 1981, wages for both sets of workers stopped rising. After 1981, wages for high paid workers (“Top 10 percent”) have risen much faster than for the bottom 90%. This reflects the way this lower productivity has been distributed to the work force. Low-wage workers have been affected to a much greater extent than high-wage workers.
Figure 2. Chart comparing income gains by the top 10% to income gains by the bottom 90% by economist Emmanuel Saez. Based on an analysis IRS data, published in Forbes.
Figure 2. Chart comparing income gains by the top 10% to income gains by the bottom 90% by economist Emmanuel Saez. Based on an analysis of IRS data, published in Forbes.
A Major Culprit in Falling Productivity Seems to Be Diminishing Returns with Respect to Oil Extraction
Many people believe that the only oil problem we need to worry about is the possibility that supply will “run out” at some point in the future. In my opinion, the real problem is different. What we are experiencing is diminishing marginal returns with respect to oil supply. In other words, it is becoming increasingly expensive to extract and process oil. Total costs, including wages for human labor, the cost of capital, the cost of energy to extract the oil, and required tax payments, are rising ever higher. Businesses are finding it nearly impossible to earn a reasonable profit extracting oil. If oil producers want to cover all of their costs, they need to borrow an increasing amount of money simply to cover normal business expenses, including the development of new fields (to replace currently depleting fields) and the payment of dividends.
Figure 3. Bloomberg exhibit showing that returns for three large oil companies on a "cash" basis fell after 2008, and are now at 50-year lows. CROCI means "Cash Return On Capital Invested." Bloomberg source.
Figure 3. Bloomberg exhibit showing that returns for three large oil companies on a “cash” basis fell after 2008, and are now at 50-year lows. CROCI means “Cash Return On Capital Invested.” Bloomberg source.
The problem of diminishing marginal returns extends to other commodity types as well, such as coal, natural gas, fresh water, and metals. Oil is especially important, because it is energy-dense and easy to transport, making it the world’s most-used fossil fuel. At the same time, we are experiencing rising costs for pollution control of various kinds, including attempts to prevent climate change.
The combination of diminishing returns for commodity production together with rising pollution control costs tends to make the world economy increasingly inefficient. This increased inefficiency affects the cost of producing many things that consumers value, including food, fresh water, housing, and transportation. Indirectly, the ability of businesses to create jobs that pay well is affected, also. I believe that this growing inefficiency in producing goods and services is the basis for the falling growth in productivity that appears in Figure 1.
Why Diminishing Returns with Respect to Energy Supplies Are Likely to be the Culprit in Falling Productivity
There are several basic issues that make our economy vulnerable to the impacts of diminishing returns:
Energy plays a critical role in creating goods and services, and thus in economic growth.
Energy that is very inexpensive to produce is important in setting up a benevolent cycle of greater productivity and more economic growth.
Diminishing returns for oil and other energy products lead to higher costs of production. If these higher costs of production are passed through to the consumer as higher prices, this leads to what we think of as a recession, and a slow-down in economic growth.
The timing of falling productivity “matches up” with falling energy consumption on the part of employers, and also with high oil prices.
Energy plays a critical role in economic growth because energy is necessary for all kinds of economic activity. Energy allows transportation to take place; it allows heating to take place, so metals can be smelted and chemical reactions of many kinds can take place; it allows the use of computers and the internet. When workarounds for problems are needed–for example, increased pollution control, or deeper wells, or desalination plants–all of these workarounds also require the use of energy products. So, the problem is not simply that it takes more fossil fuel energy to create energy products. Many other parts of the economy, including pollution control and extraction of fresh water and minerals, become more demanding of energy supplies as well.
Cheap-to-produce oil and other types of energy are important in setting up a cycle of economic growth. We think of productivity growth as being something that an employee is able to do. In fact, productivity growth is enabled by the use of “tools” that the employer (or the government) gives workers, allowing these workers to create more goods and services per hour worked. These tools can be either physical tools, such as machinery, computers, vehicles, and roads, or they can be tools provided through more specialization and training. In the case of physical tools, it is clear that energy is used both to create and operate the tools. In the case of specialization, energy is needed in a more indirect way; extra energy allows the economy to have sufficient surpluses to permit training of specialized workers, and also to allow them to have higher wages later.
Thus, we can think of human labor as being increasingly leveraged by energy-related tools. In fact, if we divide energy consumption of businesses (commercial and industrial) by the total number of non-farm employees in the United States, we find that energy consumption per employee falls very much according to the pattern we might expect, based on the rise and then fall in productivity growth shown in Figures 1 and 2. A slowdown in energy leveraging seems to correlate with the decline in the rate of productivity growth.
Figure 4. Total amount of energy used by Commercial and Industrial Sector (excluding transportation) based on EIA Energy Consumption by Sector, divided by Bureau of Labor Statistics Total Non-Farm Employees by Year.
Figure 4. Total quantity of per capita energy used by the US Commercial and Industrial Sectors (excluding transportation). Computed by dividing EIA Energy Consumption by Sector by Total Non-Farm Employment from the Bureau of Labor Statistics.
Figure 4 shows that energy consumption per employee reached a peak in 1973. Energy consumption per employee started falling in 1974. This date corresponds to the first major run-up in oil prices (Figure 5). Oil prices, on an inflation-adjusted basis, have never returned to the very low level experienced prior to 1973.
Figure 4. Historical annual average price of oil, for a grade of crude similar to "Brent," based on data of 2016 BP Statistical Review of World Energy.
Figure 5. Historical annual average price of oil, for a grade of crude similar to “Brent,” based on data of 2016 BP Statistical Review of World Energy.
The period between the end of World War II and the early 1970s was generally a period in which inflation-adjusted oil prices were under $20 per barrel. At this very low price level, it made sense to add a new interstate highway system and to greatly upgrade the electric grid and the oil pipeline distribution systems. Once oil became high-priced, the US greatly backed away from leveraging worker productivity with such big projects. Other changes began as well, including gradually shifting manufacturing to other countries. These countries typically had lower labor costs and a cheaper energy mix (more coal and hydroelectric, and less oil).
The first run-up in prices occurred after US oil supply reached a peak in 1970 (Figure 5). According to a presentation by Steve Kopits, the second run-up in prices started occurring about 1999 (Figure 6). By then, we reached a point where a disproportionate share of the cheap-to-extract oil had already been removed. Oil producers needed to start work on new oil fields in areas where extraction costs were higher.
Figure 5. Figure by Steve Kopits of Westwood Douglas showing trends in world oil exploration and production costs per barrel. CAGR is "Compound Annual Growth Rate."
Figure 6. Figure by Steve Kopits of Westwood Douglas showing trends in world oil exploration and production costs per barrel. CAGR is “Compound Annual Growth Rate.”
Oil’s diminishing returns affect the economy. As we reach diminishing returns with respect to oil production, the cost of producing additional barrels of oil tends to increase. If this higher cost is passed on to goods made directly and indirectly with oil products, we find that the prices of many products rise. Food costs are particularly affected, because oil is used extensively in agriculture and in transporting goods to market. Higher oil prices affect the cost of other types of goods, because many goods–even coal–are transported using oil. The higher cost of oil tends to ripple throughout the entire economy.
The problem, however, is that higher oil costs lead to lower productivity, because employers and governments tend to purchase fewer energy products for the benefit of their workers when oil prices are high. We end up with a mismatch:
The cost of oil products, and many other products, tends to rise.
The productivity of workers tends to grow more slowly. Wages rise very slowly, if at all. They certainly do not keep up with soaring oil prices.
The result of this mismatch is recession, as occurred in the 2007-2009 period. Economist James Hamilton has shown that 10 out of 11 post-World War II recessions were associated with oil price spikes. A 2004 IEA report states, “. . . a sustained $10 per barrel increase in oil prices from $25 to $35 would result in the OECD as a whole losing 0.4% of GDP in the first and second years of higher prices. Inflation would rise by half a percentage point and unemployment would also increase.”
A Second Way Diminishing Returns Can Work Out Badly: Prices that Are Too Low and Oversupply
In the preceding section, I explained how oil prices, if passed on to the consumer via higher prices of other goods, could lead to recession. Because our economy is a networked system, the situation doesn’t need to work this way to come out badly. There is an alternative scenario in which oil prices stay too low for businesses extracting oil to make an adequate profit. In this scenario, it is businesses, rather than consumers, who find that they have a huge financial problem. This is the problem we are encountering now. In fact, it is not just oil-producers who have a profitability problem; the profitability problem extends to businesses producing coal, natural gas, metals, and many kinds of agricultural commodities.
The reason why this kind of low-price scenario can take place (despite rising costs) is because workers are also consumers. We saw in Figure 2 that the wages of the lower 90% of workers tend to lag behind when energy consumption per worker is falling. There are a very many workers in the bottom 90%. If the wages of these workers lag behind, homes, cars, vacations, and many other kinds of discretionary goods become less affordable. The reduced demand for these finished products leads to lower demand for a wide range of commodities. This lower demand tends to push commodity prices of many kinds lower, even though the cost of production is rising. As a result, profits for a wide range of commodity producers tend to fall in a way similar to that shown in Figure 3.
It may be that we can expect a recessionary impact, a short time after profits fall. According to Deutsche Bank:
Profit margins always peak in advance of recession. Indeed, there has not been one business cycle in the post-WWII era where this has not been the case. The reason margins are a leading indicator is simple: When corporate profitability declines, a pullback in spending and hiring eventually ensues.
The article goes on to show that there is a lag of about two years between the time of profit compression and the time when recession hits. The amount of variability is quite high, with one recession coming as soon as 4 quarters after a fall in profitability, and two coming as late as 15 or 16 quarters after a fall in profits. The median lag was 8 quarters, and the average lag was 9 quarters.
This Deutsche Bank description of the cause of recessions gives an explanation why Hamilton encountered recessions after oil price spikes. These rising oil prices affected one of the costs of production for most companies. These rising costs compressed profits, and eventually led to recession.
This description of the cause of recession shows how recession can also ensue if commodity prices remain too low for an extended period. We know that oil prices began falling in the third quarter of 2014. It is now two years later. Profit margins of many commodity producers have been squeezed. We have already seen layoffs in the oil and coal industries. In this low-priced situation, companies are affected unevenly: some benefit from low prices, while others are hurt by low prices.
Commodities are often essential to economies, especially for countries that export commodities. These exporters are especially likely to be affected by low prices. Impacts are likely to include civil disorder and falling production, similar to what we are now seeing in Venezuela.
Oil importers are dependent on oil exporters, so eventually oil imports must drop. Low oil prices are likely to lead to a drop in locally produced oil products as well. As a result, we can expect that less oil and fewer other energy products will be available for leveraging the labor of human workers. If past patterns hold, we can expect a further decline in productivity growth. Rising oil prices are not really a solution either, because, as we have seen, they tend to lead to recession.
Diminishing Marginal Returns Don’t Just Go Away by Themselves
Economists claim that the law of diminishing marginal returns operates only in the short run, because in the long run, all factors of production are variable. This statement might be true, if we lived in a world without limits. In fact, the amount of arable land is very close to fixed. We have not found a way to stop population growth, either. As a result, the amount of arable land per person is falling. We need to keep finding ways to produce increasing amounts of food per arable acre of land. Doing so typically requires energy products, including oil.
We are having similar problems with fresh water supply. We can solve our falling fresh water per capita problem with deeper wells, long-distance transport, or desalination. Any of these workarounds requires energy products.
Of course, we have had diminishing returns with respect to oil supply since the 1970s. We have not yet found a reasonable workaround. Intermittent electricity is not a reasonable substitute; it does not power existing airplanes, trucks and most cars. When all costs are considered, intermittent electricity tends to be very expensive. Experience shows that if subsidies are given for intermittent electricity, they are needed for other types of electricity generation as well.
Figure 7. Figure by Euan Mearns showing relationship between installed wind + solar capacity and European electricity rates. Source Energy Matters.
Figure 7. Figure by Euan Mearns showing relationship between installed wind + solar capacity and European electricity rates. Source Energy Matters.
The belief that diminishing marginal returns are temporary is probably related to the belief that there are substitutes for everything, including energy supplies. Unfortunately, this is not the case; the laws of thermodynamics dictate otherwise.
As a result, when businesses use falling amounts of energy per capita, we should not be surprised if productivity lags, and if wages for many workers barely rise with inflation. It is possible to get some productivity gains through education, but it is very unlikely that these gains are as large as when more capital goods are used, as well as more direct use of energy. There are also clearly diminishing returns with respect to education and training; for example, if we need 10,000 additional dentists per year, training 50,000 additional dentists per year would not be helpful.
Can We Solve Our Productivity Problem with Lower Interest Rates, or with Increased Deficit Spending?
I wouldn’t count on it. Our problem is an energy problem.
Increased deficit spending could perhaps raise commodity prices a bit, and thus help the profitability of companies producing commodities. The reason commodity prices might rise is because increased spending by governments would act to supplement the low spending by workers who are suffering from low growth in wages. The sale of goods might rise for a while, but productivity of workers would still lag. Economic growth would, at best, remain very slow. If the economy were headed for recession or the collapse of commodity exporters, that situation would continue to be the case.
Lower interest rates would likely be even less helpful than deficit spending. There is no guarantee that these low interest rates would lead to increased spending on capital goods that would benefit workers. Banks in Europe and Japan would likely have even more problem with adequate profitability than they do now. Bank failure would become even more of a concern than it is now.
Our problem is really a lack of very cheap-to-produce energy that can be used to inexpensively leverage the labor of human workers. This energy needs to be of the correct kind to match the requirements of existing equipment. Without this leveraging, it is likely to be impossible to fix our productivity problem.
Sunday, September 18, 2016
SC136-14
http://www.informationclearinghouse.info/article45499.htm
Russia Has No Partners In The West
The Russian government is doing the same thing over and over again and expecting different results. The Russian government keeps making agreements with Washington, and Washington keeps breaking them.
This latest exercise in what Einstein defined as insanity is the latest Syrian cease fire agreement. Washington broke the agreement by sending the US Air Force to bomb Syrian troop positions, killing 62 Syrian soldiers and wounding 100, thus clearing the way for ISIS to renew the attack.
Russia caught Washington off guard in September 2015 when the Russian Air Force was sent to bomb ISIS positions in Syria, thus enabling the Syrian Army to regain the initiative. Russia had the war against ISIS won, but pulled out unexpectedly before the job was done. This allowed the US or its agents to resupply ISIS, which renewed the attack.
So Russia had to return to Syria. In the interval Washington had inserted itself. Now the Russian air attacks on ISIS are more complicated, as is the sky over Syria. Russia notifies Washington of its planned attacks on ISIS, and Washington warns ISIS and perhaps Turkey which shot down a Russian plane. Nevertheless, the Syrian Army gained ground.
But each time victory was stymied by “peace talks” or a “cease fire,” during which the US supported forces would regroup. Consequently, a war that Russia and Syria could have already won continues, and with a new element. Now Washington has directly attacked the Syrian army.
The US military claims it thought it was striking ISIS. Think about that a minute. The US claims to be a military superpower. It spies on the entire world, even on the personal emails and cell phone calls of its European vassals. Yet, somehow all this spy power failed to differentiate a known Syrian Army position from ISIS. If we believe that, we must conclude that the US is militarily incompetent.
This is what has happened: Prior to the current “cease fire,” the Russians could attack the US-supported jihadists, but the US could not attack Syrian forces directly, only through its jihadist proxies. The US has used the “cease fire” to create a precedent for US direct attacks on the Syrian Army.
The Russians, who almost had the war won, have shifted their focus to “peace talks” and “cease fires” that the US has used to introduce Washington’s direct participation into the conflict.
It is a mystery that the Russian government believes Washington and Moscow have any common interest in the outcome in Syria. Washington’s interest is to remove Assad and put Syria into the chaos that rules in Libya and Iraq. Russia’s interest is to stabilize Syria as a bulwark against the spread of jihadism. It is extraordinary that the Russian government is so misinformed that it thinks Moscow and Washington have a common interest in fighting terrorism, when terrorism is Washington’s weapon for destabilizing the Middle East.
How can the Russian memory be so short. Washington promised Gorbachev that if he permitted the reunification of Germany, NATO would not move one inch to the East. But the Clinton regime placed NATO on Russia’s border.
The George W. Bush regime violated the ABM Treaty by pulling out of it, and the Obama regime is putting missile bases on Russia’s border.
The neoconservatives deep-sixed no first use of nuclear weapons and elevated them to pre-emptive first strike in US war doctrine.
The Obama regime overthrew the Ukrainian government and installed a US puppet government in a former constituent part of Russia. The puppet government launched a war against the Russian populations in Ukraine, causing secession movements that Washington has mischaracterized as “Russian invasion and annexation.”
Yet, the Russian government thinks Washington is a “partner” with whom it has common interests.
Go figure.
Russia Has No Partners In The West
The Russian government is doing the same thing over and over again and expecting different results. The Russian government keeps making agreements with Washington, and Washington keeps breaking them.
This latest exercise in what Einstein defined as insanity is the latest Syrian cease fire agreement. Washington broke the agreement by sending the US Air Force to bomb Syrian troop positions, killing 62 Syrian soldiers and wounding 100, thus clearing the way for ISIS to renew the attack.
Russia caught Washington off guard in September 2015 when the Russian Air Force was sent to bomb ISIS positions in Syria, thus enabling the Syrian Army to regain the initiative. Russia had the war against ISIS won, but pulled out unexpectedly before the job was done. This allowed the US or its agents to resupply ISIS, which renewed the attack.
So Russia had to return to Syria. In the interval Washington had inserted itself. Now the Russian air attacks on ISIS are more complicated, as is the sky over Syria. Russia notifies Washington of its planned attacks on ISIS, and Washington warns ISIS and perhaps Turkey which shot down a Russian plane. Nevertheless, the Syrian Army gained ground.
But each time victory was stymied by “peace talks” or a “cease fire,” during which the US supported forces would regroup. Consequently, a war that Russia and Syria could have already won continues, and with a new element. Now Washington has directly attacked the Syrian army.
The US military claims it thought it was striking ISIS. Think about that a minute. The US claims to be a military superpower. It spies on the entire world, even on the personal emails and cell phone calls of its European vassals. Yet, somehow all this spy power failed to differentiate a known Syrian Army position from ISIS. If we believe that, we must conclude that the US is militarily incompetent.
This is what has happened: Prior to the current “cease fire,” the Russians could attack the US-supported jihadists, but the US could not attack Syrian forces directly, only through its jihadist proxies. The US has used the “cease fire” to create a precedent for US direct attacks on the Syrian Army.
The Russians, who almost had the war won, have shifted their focus to “peace talks” and “cease fires” that the US has used to introduce Washington’s direct participation into the conflict.
It is a mystery that the Russian government believes Washington and Moscow have any common interest in the outcome in Syria. Washington’s interest is to remove Assad and put Syria into the chaos that rules in Libya and Iraq. Russia’s interest is to stabilize Syria as a bulwark against the spread of jihadism. It is extraordinary that the Russian government is so misinformed that it thinks Moscow and Washington have a common interest in fighting terrorism, when terrorism is Washington’s weapon for destabilizing the Middle East.
How can the Russian memory be so short. Washington promised Gorbachev that if he permitted the reunification of Germany, NATO would not move one inch to the East. But the Clinton regime placed NATO on Russia’s border.
The George W. Bush regime violated the ABM Treaty by pulling out of it, and the Obama regime is putting missile bases on Russia’s border.
The neoconservatives deep-sixed no first use of nuclear weapons and elevated them to pre-emptive first strike in US war doctrine.
The Obama regime overthrew the Ukrainian government and installed a US puppet government in a former constituent part of Russia. The puppet government launched a war against the Russian populations in Ukraine, causing secession movements that Washington has mischaracterized as “Russian invasion and annexation.”
Yet, the Russian government thinks Washington is a “partner” with whom it has common interests.
Go figure.
Wednesday, September 14, 2016
SC136-13
https://srsroccoreport.com/the-death-of-the-bakken-field-has-begun-big-trouble-for-the-u-s/
THE DEATH OF THE BAKKEN FIELD HAS BEGUN: Means Big Trouble For The U.S.
The Death of the Great Bakken Oil Field has begun and very few Americans understand the significance. Just a few years ago, the U.S. Energy Industry and Mainstream media were gloating that the United States was on its way to “Energy Independence.”
Unfortunately for most Americans, they believed the hype and are now back to driving BIG SUV’s and trucks that get lousy fuel mileage. And why not? Americans now think the price of gasoline will continue to decline because the U.S. oil industry is able to produce its “supposed” massive shale oil reserves for a fraction of the cost, due to the new wonders of technological improvement.
I actually hear this all the time when I travel and talk to family, friends and strangers. I gather they have no clue that the Great Bakken Oil Field is now down a stunning 25% from its peak in just a little more than a year and half ago:
bakken-field-oil-production-sept-2016
The mighty Bakken oil field located in North Dakota reached peak production in December 2014 at 1.26 million barrels per day (mbd) and is now down to 942,000 bd. This decline is no surprise to me or to my readers who have been following my work for the past several years.
I wrote about the upcoming crash of the Bakken oil field in my article (click on image to read article)– Published, NOV. 2013:
the-coming-bust-of-the-great-bakken-oil-field
I ended the article with these sobering words:
There are only so many drilling locations available and once they run out, the Great Bakken Field will become a BUST as the high decline rates will push overall oil production down the very same way it came up.
Those who moved to the frigid state of North Dakota with Dollar signs in their eyes and images of sugar-plums dancing in their heads will realize firsthand the negative ramifications of all BOOM & BUST cycles.
Well, the Bust of North Dakota economy has arrived and according to the article, “The North Dakota Great Recession“:
Unfortunately by April 2015 it was clear that the oil markets were in a secular decline brought on by oversupply in the global energy markets fueled by a deep recession in China. As a result, companies started to lay off workers, and over the following months caused a massive exodus of people as jobs were eliminated. Nobody is exactly sure how many people have left the state, but some put estimates as high as 25,000.
The strongest real estate market continues to be Watford City with the weakest in Minot. However, even in Watford City the price of a three-bedroom rental home has come down from $2,500 in 2015 to a current price of $1,400. This represents a 44 percent decline of the rental price in the market.
Some folks believe the reason for the decline in oil production at the Bakken was due to low oil prices. While this was part of the reason, the Bakken was going to peak and decline in 2016-2017 regardless of the price. This was forecasted by peak oil analyst Jean Laherrere. I wrote about this in my article below (click on image to read article)– Published, APRIL 2015:
what-will-the-death-of-the-great-bakken-look-like
I took Jean Laherrere’s chart and placed it next to the current actual Bakken oil field production:
bakken-oil-decline-vs-jean-laherrere-forecast
As we can see in the chart above, the rise and fall of Bakken oil production is very close to what Jean Laherrere forecasted several years ago (shown by the red arrow). According to Laherrere’s chart, the Bakken will be producing a lot less oil by 2020 and very little by 2025. This would also be true for the Eagle Ford Field in Texas.
According to the most recent EIA Drilling Productivity Report, the Eagle Ford Shale Oil Field in Texas will be producing an estimated 1,026,000 barrels of oil per day in September, down from a peak of 1,708,000 barrels per day in May 2015. Thus, Eagle Ford oil production is slated to be down a stunning 40% since its peak last year.
texas-eagle-ford-oil-production-sept-2016
Do you folks see the writing on the wall here? The Bakken down 25% and the Eagle Ford down 40%. These are not subtle declines. This is much quicker than the U.S. Oil Industry or the Mainstream Media realize.
And… it’s much worse than that.
The U.S. Oil Industry Hasn’t Made a RED CENT Producing Shale
Rune Likvern of Fractional Flow has done a wonderful job providing data on the Bakken Shale Oil Field. Here is his excellent chart showing the cumulative FREE CASH FLOW from producing oil in the Bakken:
bakken-cumulative-negative-free-cash-flow-likvern
I will simply this chart by explaining that the BLACK BARS are estimates of the monthly Free Cash flow from producing oil in the Bakken since 2009, while the RED AREA is the cumulative negative free cash flow. As we can see there are very few black bars that are positive. Most are negative, heading lower.
Furthermore, the red area shows that the approximate negative free cash flow (deducting CAPEX- capital expenditures) is $32 billion. So, with all the effort and high oil prices from 2011-2014 (first half of 2014), the energy companies producing shale oil in the Bakken are in the hole for $32 billion. Well done…. hat’s off to the new wonderful fracking technology.
According to Rune Likvern in his article on the Bakken, he stated the following:
Just to retire estimated total debts (about $36 Billion, including costs for DUCs, SDWs, excluding hedges and income/loss of natural gas and NGLs) would require about 7 years with extraction and prices at Jun-16 levels.
Nominally to retire all debts (reach payout) would take an (average) future oil price close to $65/bo (WTI) for all the wells in operation as of end June – 16. This is without making any profit.
For the wells in production as per Jun-16, the total extraction of these will decline about 40% by Jun-17, and depletes their remaining reserves with about 20%. By assuming the operations remain cash flow neutral, total debt remains at $36 B in Jun-17.
As from Jul-17 this would now require an average oil price of about $73/bo (WTI) for these wells to nominally retire all debts (reach payout). Additional wells will add to what price is required to retire the total debt.
What Rune is stating here is that the $36 billion in total cumulative debt will occur by June 2017. Thus, it would take an average $65 a barrel to just pay back the debt in seven years. With the way things are going in the U.S. and world economies, I doubt we are going to see much higher oil prices.
Furthermore, the work by Louis Arnoux and the Hills Group suggest the price of oil will fall, not rise due to a Thermodynamic Collapse. More about this in an upcoming interview.
The United States Is In Big Trouble & Most Americans Have No Clue
As I have been documenting in previous articles (going back until 2013) the U.S. Shale Oil Industry was a house-of-cards. Readers who have been following my work, based on intelligent work of others, understood that Shale Oil is just another Ponzi Scheme in a long list of Ponzi Schemes.
From time to time, I look around different websites that publish my work and read some of the comments. I am surprised how many individuals still don’t believe in Peak Oil even though I explained the Falling EROI – Energy Returned On Investment quite clearly.
For some strange reason, some individuals cannot use deductive reasoning to destroy lousy conspiracy theories. Moreover, if they do believe in Peak Oil, then they think there is a wonderful “Silver-Bullet Energy Technology” that will save us all. I gather they believe this because the REALITY and IMPLICATIONS of Peak Oil are just too horrible, to say the least. So, holding onto HOPE that something will save us, just in the nick of time, is better than accepting the awful reality heading our way.
And the awful reality of Peak Oil will be felt more by Americans as their lifestyles have been highly elevated by the ability to extract wealth and resources from other countries through the issuing of massive amounts of paper Dollars and debt. Basically, they work, and we eat.
Unfortunately, the propping up of the U.S. market by the Fed and the domestic shale energy Ponzi scheme is running out of time. This is why it is imperative for investors to start moving out of Bonds, Stocks and Real Estate and into physical gold and silver to protect wealth.
For the wealthy investor or institution that believe a 5-10% allocation in physical gold is good insurance, you are sadly mistaken. While Donald Trump is receiving more support from Americans in his Presidential race, his campaign motto that he will “Make American Strong Again”, will never happen. The America we once knew is over. There just isn’t the available High EROI – Energy Returned On Investment energy supplies to allow us to continue the same lifestyle we enjoyed in the past....
THE DEATH OF THE BAKKEN FIELD HAS BEGUN: Means Big Trouble For The U.S.
The Death of the Great Bakken Oil Field has begun and very few Americans understand the significance. Just a few years ago, the U.S. Energy Industry and Mainstream media were gloating that the United States was on its way to “Energy Independence.”
Unfortunately for most Americans, they believed the hype and are now back to driving BIG SUV’s and trucks that get lousy fuel mileage. And why not? Americans now think the price of gasoline will continue to decline because the U.S. oil industry is able to produce its “supposed” massive shale oil reserves for a fraction of the cost, due to the new wonders of technological improvement.
I actually hear this all the time when I travel and talk to family, friends and strangers. I gather they have no clue that the Great Bakken Oil Field is now down a stunning 25% from its peak in just a little more than a year and half ago:
bakken-field-oil-production-sept-2016
The mighty Bakken oil field located in North Dakota reached peak production in December 2014 at 1.26 million barrels per day (mbd) and is now down to 942,000 bd. This decline is no surprise to me or to my readers who have been following my work for the past several years.
I wrote about the upcoming crash of the Bakken oil field in my article (click on image to read article)– Published, NOV. 2013:
the-coming-bust-of-the-great-bakken-oil-field
I ended the article with these sobering words:
There are only so many drilling locations available and once they run out, the Great Bakken Field will become a BUST as the high decline rates will push overall oil production down the very same way it came up.
Those who moved to the frigid state of North Dakota with Dollar signs in their eyes and images of sugar-plums dancing in their heads will realize firsthand the negative ramifications of all BOOM & BUST cycles.
Well, the Bust of North Dakota economy has arrived and according to the article, “The North Dakota Great Recession“:
Unfortunately by April 2015 it was clear that the oil markets were in a secular decline brought on by oversupply in the global energy markets fueled by a deep recession in China. As a result, companies started to lay off workers, and over the following months caused a massive exodus of people as jobs were eliminated. Nobody is exactly sure how many people have left the state, but some put estimates as high as 25,000.
The strongest real estate market continues to be Watford City with the weakest in Minot. However, even in Watford City the price of a three-bedroom rental home has come down from $2,500 in 2015 to a current price of $1,400. This represents a 44 percent decline of the rental price in the market.
Some folks believe the reason for the decline in oil production at the Bakken was due to low oil prices. While this was part of the reason, the Bakken was going to peak and decline in 2016-2017 regardless of the price. This was forecasted by peak oil analyst Jean Laherrere. I wrote about this in my article below (click on image to read article)– Published, APRIL 2015:
what-will-the-death-of-the-great-bakken-look-like
I took Jean Laherrere’s chart and placed it next to the current actual Bakken oil field production:
bakken-oil-decline-vs-jean-laherrere-forecast
As we can see in the chart above, the rise and fall of Bakken oil production is very close to what Jean Laherrere forecasted several years ago (shown by the red arrow). According to Laherrere’s chart, the Bakken will be producing a lot less oil by 2020 and very little by 2025. This would also be true for the Eagle Ford Field in Texas.
According to the most recent EIA Drilling Productivity Report, the Eagle Ford Shale Oil Field in Texas will be producing an estimated 1,026,000 barrels of oil per day in September, down from a peak of 1,708,000 barrels per day in May 2015. Thus, Eagle Ford oil production is slated to be down a stunning 40% since its peak last year.
texas-eagle-ford-oil-production-sept-2016
Do you folks see the writing on the wall here? The Bakken down 25% and the Eagle Ford down 40%. These are not subtle declines. This is much quicker than the U.S. Oil Industry or the Mainstream Media realize.
And… it’s much worse than that.
The U.S. Oil Industry Hasn’t Made a RED CENT Producing Shale
Rune Likvern of Fractional Flow has done a wonderful job providing data on the Bakken Shale Oil Field. Here is his excellent chart showing the cumulative FREE CASH FLOW from producing oil in the Bakken:
bakken-cumulative-negative-free-cash-flow-likvern
I will simply this chart by explaining that the BLACK BARS are estimates of the monthly Free Cash flow from producing oil in the Bakken since 2009, while the RED AREA is the cumulative negative free cash flow. As we can see there are very few black bars that are positive. Most are negative, heading lower.
Furthermore, the red area shows that the approximate negative free cash flow (deducting CAPEX- capital expenditures) is $32 billion. So, with all the effort and high oil prices from 2011-2014 (first half of 2014), the energy companies producing shale oil in the Bakken are in the hole for $32 billion. Well done…. hat’s off to the new wonderful fracking technology.
According to Rune Likvern in his article on the Bakken, he stated the following:
Just to retire estimated total debts (about $36 Billion, including costs for DUCs, SDWs, excluding hedges and income/loss of natural gas and NGLs) would require about 7 years with extraction and prices at Jun-16 levels.
Nominally to retire all debts (reach payout) would take an (average) future oil price close to $65/bo (WTI) for all the wells in operation as of end June – 16. This is without making any profit.
For the wells in production as per Jun-16, the total extraction of these will decline about 40% by Jun-17, and depletes their remaining reserves with about 20%. By assuming the operations remain cash flow neutral, total debt remains at $36 B in Jun-17.
As from Jul-17 this would now require an average oil price of about $73/bo (WTI) for these wells to nominally retire all debts (reach payout). Additional wells will add to what price is required to retire the total debt.
What Rune is stating here is that the $36 billion in total cumulative debt will occur by June 2017. Thus, it would take an average $65 a barrel to just pay back the debt in seven years. With the way things are going in the U.S. and world economies, I doubt we are going to see much higher oil prices.
Furthermore, the work by Louis Arnoux and the Hills Group suggest the price of oil will fall, not rise due to a Thermodynamic Collapse. More about this in an upcoming interview.
The United States Is In Big Trouble & Most Americans Have No Clue
As I have been documenting in previous articles (going back until 2013) the U.S. Shale Oil Industry was a house-of-cards. Readers who have been following my work, based on intelligent work of others, understood that Shale Oil is just another Ponzi Scheme in a long list of Ponzi Schemes.
From time to time, I look around different websites that publish my work and read some of the comments. I am surprised how many individuals still don’t believe in Peak Oil even though I explained the Falling EROI – Energy Returned On Investment quite clearly.
For some strange reason, some individuals cannot use deductive reasoning to destroy lousy conspiracy theories. Moreover, if they do believe in Peak Oil, then they think there is a wonderful “Silver-Bullet Energy Technology” that will save us all. I gather they believe this because the REALITY and IMPLICATIONS of Peak Oil are just too horrible, to say the least. So, holding onto HOPE that something will save us, just in the nick of time, is better than accepting the awful reality heading our way.
And the awful reality of Peak Oil will be felt more by Americans as their lifestyles have been highly elevated by the ability to extract wealth and resources from other countries through the issuing of massive amounts of paper Dollars and debt. Basically, they work, and we eat.
Unfortunately, the propping up of the U.S. market by the Fed and the domestic shale energy Ponzi scheme is running out of time. This is why it is imperative for investors to start moving out of Bonds, Stocks and Real Estate and into physical gold and silver to protect wealth.
For the wealthy investor or institution that believe a 5-10% allocation in physical gold is good insurance, you are sadly mistaken. While Donald Trump is receiving more support from Americans in his Presidential race, his campaign motto that he will “Make American Strong Again”, will never happen. The America we once knew is over. There just isn’t the available High EROI – Energy Returned On Investment energy supplies to allow us to continue the same lifestyle we enjoyed in the past....
Monday, September 12, 2016
SC136-12
http://www.truthdig.com/report/item/fooled_again_20160911
Fooled Again
The naive hopes of Bernie Sanders’ supporters—to build a grass-roots political movement, change the Democratic Party from within and push Hillary Clinton to the left—have failed. Clinton, aware that the liberal class and the left are not going to mount genuine resistance, is running as Mitt Romney in drag. The corporate elites across the political spectrum, Republican and Democrat, have gleefully united to anoint her president. All that remains of Sanders’ “revolution” is a 501(c)(4) designed to raise money, including from wealthy, anonymous donors, to ensure that he will be a senator for life. Great historical events happen twice, as Karl Marx quipped, first as tragedy and then as farce.
The multibillion-dollar extravaganza of our electoral Circus Maximus is part of the smokescreen that covers the ongoing devastation of globalization, deindustrialization, trade deals such as the Trans-Pacific Partnership, endless war, climate change and the intrusion into every corner of our lives by the security and surveillance state. Our democracy is dead. Clinton and Donald Trump do not have the power or the interest to revive it. They kneel before the war machine, which consumes trillions of dollars to wage futile wars and bankroll a bloated military. To defy the fortress state is political suicide. Politicians are courtiers to Wall Street. The candidates mouth the clichés of justice, improvements in income equality and democratic choice, but it is a cynical game. Once it is over, the victors will go to Washington to work with the lobbyists and financial elites to carry out the real business of ruling.
While there is a difference in the temperament of the two major presidential candidates, that difference will play out only in how our poison will be delivered. Political personalities serve global corporate centers of power. They do not control them. Barack Obama illustrates this.
To neoliberals, everyone and everything are disposable. The failed states that have risen up across the Middle East, Africa, the Caucasus and Asia in the wake of the Cold War herald a neoliberal world driven by violence, corruption, greed and desperation. The drug traffickers, smugglers, pirates, kidnappers, jihadists, criminal gangs and militias that roam huge swaths of territory where central authority has vanished are the real faces of globalization. These nihilists define Islamic State just as they define the corporate state. Corruption may be more naked and cruder in Afghanistan or Iraq, but it has its parallel in the for-sale politicians and political parties that dominate the United States and Europe. The common good—the building of community and solidarity—has been replaced through decades of corporate indoctrination with the callous call to amass all you can for yourself and leave the stranger bleeding on the side of the road.
Is the Goldman Sachs commodity trader, who hoards futures of rice, wheat, corn, sugar and livestock to jack up prices on the global market, leaving poor people in Africa, Asia, the Middle East and Latin America to starve, any less morally repugnant than the drug trafficker? Are F-16 pilots who incinerate families in Raqqa morally distinct from jihadists who burn a captured Jordanian pilot in a cage? Is torture in one of our black sites or offshore penal colonies any less barbaric than torture at the hands of Islamic State? Are the decapitations of children by military drones any more defensible than decapitations of Egyptian laborers on a beach in Libya by self-described holy warriors? Is Heather Bresch, the CEO of Mylan, who raised the price of the lifesaving EpiPen by 400 percent or more and whose compensation since 2007 has risen by 600 percent to above $18 million a year, any less venal than a human trafficker who sends an overloaded boat and its occupants to their doom on the coast of Libya?
There is a new world order. It is based on naked exploitation. It—not democracy—is what we have exported across the globe. And it looks a lot like the anarchic state that Hobbes feared. The criminal gangs that deliver migrants to Europe make about $100 million a month for their work. They exploit and traffic human beings just as highly paid CEOs do.
The failed states of Iraq, Syria and Libya, a direct result of globalization, have their counterparts in Detroit, St. Louis, Oakland, Memphis, Baltimore, Atlanta, Milwaukee and the south side of Chicago. They are our versions of Mogadishu, complete with lawlessness, senseless killings, armed gangs, widespread hunger, fear, a population retreating into the numbing embrace of opiates, crippling poverty, dysfunctional state institutions, the growth of private security companies that protect the elites, and indiscriminate police violence that creates reigns of terror aimed at the poor. The more the global corporate forces extract from us in the name of austerity and the maximization of profit, the more parts of the U.S. will descend into domestic versions of the failed states overseas. The same system exists here and abroad. And it has the same result here and abroad. It may appear first in Somalia, Mali, Guinea-Bissau and Libya, but it will soon come to characterize much of America. The proliferation of weapons will do to our society what it has done to every other failed state where there has been unchecked access to arsenals—hand power to those with a penchant for violence.
“Anyone who wants to rule men first tries to humiliate them, to trick them out of their rights and their capacity for resistance, until they are as powerless before him as animals,” Elias Canetti wrote in “Crowds and Power.” “He uses them like animals and, even if he does not tell them so, in himself he always knows quite clearly that they mean just as little to him; when he speaks to his intimates he will call them sheep or cattle. His ultimate aim is to incorporate them into himself and to suck the substance out of them. What remains of them afterwards does not matter to him. The worse he has treated them, the more he despises them. When they are no more use at all, he disposes of them as he does of his excrement, simply seeing to it that they do not poison the air of his house.”
History has amply demonstrated where this will end up. The continued exploitation by an unchecked elite, and the rising levels of poverty and insecurity, will unleash a legitimate rage among the desperate. They will see through the lies and propaganda of the elites. They will demand retribution. They will turn to those who express the hatred they feel for the powerful and the institutions, now shams, that were designed to give them a voice. They will seek not reform but destruction of a system that has betrayed them.
Failed states—czarist Russia, the Weimar Republic, the former Yugoslavia—vomit up political monstrosities. We will be no different.
A form of fascism has already taken hold in two nations on the edges of the European Union, Hungary and Poland. Far-right parties, reacting to the flood of more than a million migrants that descended on Europe last year, are gaining ground in France, Austria, Sweden, Germany and Greece. Nationalism, buttressed by a deification of the military, will be used to compensate for individual powerlessness and a loss of national identity. Dissent in the U.S. will become “anti-American,” a form of treason. Enemies at home will be vilified along with enemies abroad. And this will lead to even more warfare in the Middle East. The far-right political parties in Eastern Europe flirt rhetorically with military conflict with Russia. And because of its membership in NATO, the United States would be obligated to enter any hostilities.
Voting for Hillary Clinton will not halt this slide into the apocalypse. It will only accelerate it. Donald Trump may vanish from the political landscape, but someone even more venal, and probably more intelligent, will take his place. Our job is to dismantle the machinery that is pushing toward the cliff. And this means sustained and massive civil disobedience. As exemplified by the protests at the Standing Rock Sioux Reservation and by prisoners across the nation who carried out work stoppages last Friday, it means doing everything possible not to cooperate with the elements of authority. It means disrupting the mechanisms of power. It means overcoming fear. It means no longer believing the lies we are told.
Fooled Again
The naive hopes of Bernie Sanders’ supporters—to build a grass-roots political movement, change the Democratic Party from within and push Hillary Clinton to the left—have failed. Clinton, aware that the liberal class and the left are not going to mount genuine resistance, is running as Mitt Romney in drag. The corporate elites across the political spectrum, Republican and Democrat, have gleefully united to anoint her president. All that remains of Sanders’ “revolution” is a 501(c)(4) designed to raise money, including from wealthy, anonymous donors, to ensure that he will be a senator for life. Great historical events happen twice, as Karl Marx quipped, first as tragedy and then as farce.
The multibillion-dollar extravaganza of our electoral Circus Maximus is part of the smokescreen that covers the ongoing devastation of globalization, deindustrialization, trade deals such as the Trans-Pacific Partnership, endless war, climate change and the intrusion into every corner of our lives by the security and surveillance state. Our democracy is dead. Clinton and Donald Trump do not have the power or the interest to revive it. They kneel before the war machine, which consumes trillions of dollars to wage futile wars and bankroll a bloated military. To defy the fortress state is political suicide. Politicians are courtiers to Wall Street. The candidates mouth the clichés of justice, improvements in income equality and democratic choice, but it is a cynical game. Once it is over, the victors will go to Washington to work with the lobbyists and financial elites to carry out the real business of ruling.
While there is a difference in the temperament of the two major presidential candidates, that difference will play out only in how our poison will be delivered. Political personalities serve global corporate centers of power. They do not control them. Barack Obama illustrates this.
To neoliberals, everyone and everything are disposable. The failed states that have risen up across the Middle East, Africa, the Caucasus and Asia in the wake of the Cold War herald a neoliberal world driven by violence, corruption, greed and desperation. The drug traffickers, smugglers, pirates, kidnappers, jihadists, criminal gangs and militias that roam huge swaths of territory where central authority has vanished are the real faces of globalization. These nihilists define Islamic State just as they define the corporate state. Corruption may be more naked and cruder in Afghanistan or Iraq, but it has its parallel in the for-sale politicians and political parties that dominate the United States and Europe. The common good—the building of community and solidarity—has been replaced through decades of corporate indoctrination with the callous call to amass all you can for yourself and leave the stranger bleeding on the side of the road.
Is the Goldman Sachs commodity trader, who hoards futures of rice, wheat, corn, sugar and livestock to jack up prices on the global market, leaving poor people in Africa, Asia, the Middle East and Latin America to starve, any less morally repugnant than the drug trafficker? Are F-16 pilots who incinerate families in Raqqa morally distinct from jihadists who burn a captured Jordanian pilot in a cage? Is torture in one of our black sites or offshore penal colonies any less barbaric than torture at the hands of Islamic State? Are the decapitations of children by military drones any more defensible than decapitations of Egyptian laborers on a beach in Libya by self-described holy warriors? Is Heather Bresch, the CEO of Mylan, who raised the price of the lifesaving EpiPen by 400 percent or more and whose compensation since 2007 has risen by 600 percent to above $18 million a year, any less venal than a human trafficker who sends an overloaded boat and its occupants to their doom on the coast of Libya?
There is a new world order. It is based on naked exploitation. It—not democracy—is what we have exported across the globe. And it looks a lot like the anarchic state that Hobbes feared. The criminal gangs that deliver migrants to Europe make about $100 million a month for their work. They exploit and traffic human beings just as highly paid CEOs do.
The failed states of Iraq, Syria and Libya, a direct result of globalization, have their counterparts in Detroit, St. Louis, Oakland, Memphis, Baltimore, Atlanta, Milwaukee and the south side of Chicago. They are our versions of Mogadishu, complete with lawlessness, senseless killings, armed gangs, widespread hunger, fear, a population retreating into the numbing embrace of opiates, crippling poverty, dysfunctional state institutions, the growth of private security companies that protect the elites, and indiscriminate police violence that creates reigns of terror aimed at the poor. The more the global corporate forces extract from us in the name of austerity and the maximization of profit, the more parts of the U.S. will descend into domestic versions of the failed states overseas. The same system exists here and abroad. And it has the same result here and abroad. It may appear first in Somalia, Mali, Guinea-Bissau and Libya, but it will soon come to characterize much of America. The proliferation of weapons will do to our society what it has done to every other failed state where there has been unchecked access to arsenals—hand power to those with a penchant for violence.
“Anyone who wants to rule men first tries to humiliate them, to trick them out of their rights and their capacity for resistance, until they are as powerless before him as animals,” Elias Canetti wrote in “Crowds and Power.” “He uses them like animals and, even if he does not tell them so, in himself he always knows quite clearly that they mean just as little to him; when he speaks to his intimates he will call them sheep or cattle. His ultimate aim is to incorporate them into himself and to suck the substance out of them. What remains of them afterwards does not matter to him. The worse he has treated them, the more he despises them. When they are no more use at all, he disposes of them as he does of his excrement, simply seeing to it that they do not poison the air of his house.”
History has amply demonstrated where this will end up. The continued exploitation by an unchecked elite, and the rising levels of poverty and insecurity, will unleash a legitimate rage among the desperate. They will see through the lies and propaganda of the elites. They will demand retribution. They will turn to those who express the hatred they feel for the powerful and the institutions, now shams, that were designed to give them a voice. They will seek not reform but destruction of a system that has betrayed them.
Failed states—czarist Russia, the Weimar Republic, the former Yugoslavia—vomit up political monstrosities. We will be no different.
A form of fascism has already taken hold in two nations on the edges of the European Union, Hungary and Poland. Far-right parties, reacting to the flood of more than a million migrants that descended on Europe last year, are gaining ground in France, Austria, Sweden, Germany and Greece. Nationalism, buttressed by a deification of the military, will be used to compensate for individual powerlessness and a loss of national identity. Dissent in the U.S. will become “anti-American,” a form of treason. Enemies at home will be vilified along with enemies abroad. And this will lead to even more warfare in the Middle East. The far-right political parties in Eastern Europe flirt rhetorically with military conflict with Russia. And because of its membership in NATO, the United States would be obligated to enter any hostilities.
Voting for Hillary Clinton will not halt this slide into the apocalypse. It will only accelerate it. Donald Trump may vanish from the political landscape, but someone even more venal, and probably more intelligent, will take his place. Our job is to dismantle the machinery that is pushing toward the cliff. And this means sustained and massive civil disobedience. As exemplified by the protests at the Standing Rock Sioux Reservation and by prisoners across the nation who carried out work stoppages last Friday, it means doing everything possible not to cooperate with the elements of authority. It means disrupting the mechanisms of power. It means overcoming fear. It means no longer believing the lies we are told.
Friday, September 9, 2016
SC136-11
http://www.informationclearinghouse.info/article45407.htm
Pathology Incorporated; The Facade Of American Democracy
With the rigged Democratic presidential nomination behind us, the US election reality show continues. The mass media is creating sensations around what has become a national embarrassment with this contest of the lesser of the two crazies. On the one hand we have Donald Trump, depicted as a quintessential narcissist and on the other, Hillary Clinton who is often portrayed as a sociopath. Hype is created by putting these labels on the candidates, pitting one personality disorder against the other.
This is a corporate sponsored election charade doing business as usual and distracting people from the real power behind the veil. In The Corporation: The Pathological Pursuit of Profits and Power, filmmaker and law professor Joel Bakan (2004)examined the consistent character attributes of corporations and concludes that if they were a human, they are a textbook example of a psychopath.
Psychopathy is a personality disorder that cuts off those who are affected by it from the emotional reality of others. The core of this pathology is the inability to put oneself into someone’s shoes. Empathy is the seat of conscience, and without it comes an incapacity for love. These candidates are just symptoms of a system run by corporations, which is now revealing the full fledge of pathology incorporated here in the United States. When a society lacks understanding of the depth of its darkness, this unaccounted power sees no bounds for its pursuit of a single vision.
The Perversion of Humanity
In his seminal work The Mask of Sanity, first published in 1941, psychiatrist Hervey M. Cleckleyarticulated how, among the traits of psychopathy such as superficial charm, emotional poverty and egocentricity, its essential characteristic lies in its deceitful nature.
Those who are devoid of empathy hide their lack of internal structure in a façade of normalcy. By emulating good human attributes, these unknown members of society prey on the rest. They have found the best way to mask their vice by infiltrating governments and directly altering the definition of the norm. Through control of monetary supply and monopoly over markets, these 1% pathological beings have financially engineered a perversion of humanity through a pyramid Ponzi scheme of Darwinian survival of the most callous and cunning. By turning morality upside down, they not only make their deviance invisible, but actively incentivize these disturbing characters, making all people engage in this race to the bottom.
By seducing masses with the allure of middle class lifestyle and material pursuit of happiness, the beast within humanity unlocked citizens’ unconscious desires and opened the door to unbridled commercial interests. The government that was hijacked by corporate lobbyists established a symbiotic relationship with its own people, making voters become the host, through manufacturing consent. While people are busy chasing the American dream in shopping malls and trying to climb a corporate ladder of success, these parasites latch onto the vulnerable, sucking the blood of innocents in the Middle East and the laboring sweat of disadvantaged populations around the world.
Like adventurous American eagles who have no fear of soaring too high, corporate patronage networks with wings of oil companies on the right and the Wall Street banking industries on the left take flight to conquer the globe. Vultures circle around the Bermuda Triangle of the TPP, TTIP and TISA, creating a vortex of unregulated greed. When their conquest turns sour, they make sure they get bailed out by the taxpayers and then move on to their next fraud or crime.
Devouring Conscience
Waves of whisleblowers in recent years have brought true resistance against this corporate takeover of democracy. Human beings who feel the pulse of conscience in the heart are a real threat to this authoritarian state that works in secrecy. They punish with impunity these truthtellers who reveal their crimes. Chelsea Manning, who shed light on government illegal wars, is in prison serving 35 years, being placed in a solitary cage and denied basic care. After her recent suicide attempt, the state tried to punish her even more. Edward Snowden, who blew the whistle on NSA mass surveillance remains in exile.
Admins of this merciless autocratic system deflect issues and project characteristics that belong to them. With smear campaigns and character assassination, the mainstream media attacks anyone who dares to hold an accurate mirror of what they are really doing. WikiLeaks, the publisher of last resort, has been a target of this coordinated assault. After the organization released troves of US classified military records of the Afghan war, joint Chief of Staff Admiral Mike Mullen saidWikiLeaks might have blood on their hands, when in reality these documents revealed the US Government’s own murder of 20,000 people by assassination, civilian massacres and night raids.
This assault on global free press never ends. Called by US officials a ‘high tech terrorist’ and incited for assassination, WikiLeaks editor in chief, Julian Assange remains detained in the Ecuadorian embassy, despite a UN Working Group’s ruling clearly stating this detention as unlawful. Recent WikiLeaks’publication of DNC emails that led to the forced resignation of top officials has shown the Democratic Party’s collusion with corporate media in undermining Bernie Sanders’ campaign and rigging the presidential primary.
This Democratic Party’s habit of destabilizing democracy is nothing new. A lawsuit was filed against their use of ‘groundless and abusive litigation’ to bankrupt third party Ralph Nader’s campaign, obstructing his ballot access in 18 states during his run in 2004. Back then, pundits and progressive news outlets in unison kept silent about such injustice and instead created an echo chamber, calling him a spoiler.
We are now seeing the same old knee-jerk reaction. In response to the DNC leaks, the establishment media and the left has attacked Assange and Green Party presidential candidate Jill Stein, slandering them as colluding with Vladimir Putin. New DNC chair Donna Brazile has now joined the attack, twisting reality by callingAssange a cyber-criminal. These apologists for power pledge their allegiance to the Clinton Foundation – the flag of Goldman Sachs, Google and Exxon, and fiercely defend this pathological pursuit of the Corporate States of America.
The Barbarian Within
These developments are all a part of their psychological makeup. Psychopathic abuse unfolds in three stages, defined as ‘idealization, devaluation and discard.’ With charm and feigned empathy, they allure potential victims into their snare. As soon as they seal the relationship and take what they want, they begin looking for their next victim to exploit.
At one point, sooner or later, the mask of the psychopath slips and the monster beneath reveals itself. Psychopathy has been running throughout the history of America, dragging people into a mission of Manifest Destiny. The indigenous of this country were terrorized and murdered, while blacks were enslaved and brutalized. The poor and people of color have been continuously abandoned and impoverished. They have all seen the barbarians inside Western civilization and now even the crumbling middle class is beginning to see the face of this savage beast.
Obama’s campaign was a mastery of deception. Now, the devaluation is moving into the final stage. The masks are blowing off and corporate masters behind the scenes don’t even care to maintain a semblance of democracy anymore. The lesser of two evils in this election cycle, showcasing the two most disliked presidential candidates in US history, is a testimony of this.
Trump blazes through his campaign trail with bombardment of racism, bigotry and word salads of mouthy contradictions. When reflecting on the death of Muammar Gaddafi in Libya, Hillary Clinton cackled; “We came, we saw, he died”- showing a total lack of compassion and laughing at the role she played then as secretary of state in the complete destruction of a country and leader, who might still be alive if he hadn’t challenged the petrodollar hegemony by trying to create a new currency for Africa. The US election as a center of oligarchic control is now having its own pathology and disdain for life in full display. When the mask of sanity slips, the system comes into the final stage – the discard phase.
Cure Is in the Pain
It is clear now that this election is just another smoky mirror, yet what is not generally known is that the American people have already been discarded. Many are still enmeshed in the illusion or simply refuse to see it. In the eyes of corporate ‘personhood’, which is nothing but a legal fiction, our humanity is becoming more and more disposable. This artificial entity is run by cannibalistic desires and cunning intelligence with no heart that can feel for others. It is driven by relentless destructive urges for control and power, even if it may destroy the world and itself in the process.
Bakan (2004) argues how they are “in a word, inhuman—and its goal, as Noam Chomsky states, is to ‘ensure that the human beings who [it is] interacting with, you and me, also become inhuman’”. We are now seeing this vision of a future with trans-humanism agendas. Cybernetic technology and Artificial Intelligence is attempting to marry machines with humans, while efforts like Bill Gates’ vaccine project, presented as saving lives, apparently aims to depopulate through what amounts to 21st century eugenics. With this trend, a plan to reprogram humanity to become just a cog in a wheel seems to have reached a new stage.
When robots replace labor, corporations won’t need workers anymore. When drones and missiles are automated, they don’t need soldiers anymore who are still willing to fight for this bloody pathological pursuit of power. Psychopaths move on when resources are depleted or their targets just aren’t useful anymore. They have no remorse for victims of their crimes; the unemployed, elderly, indebted, foreclosed and veterans with PTSD.
Where does this lead us? Many who have endured psychopathic abuse in their personal life escaped these toxic relationships and became survivors. They woke up in the midst of horror and found the strength to defy illegitimate authority that had been installed in their minds. Hope now can be found in the courage of our fellow humans and simply in walking away from a society maligned with these heartless agendas.
We can regain sanity by breaking the entrapment of this agreement and change the terms of engagement. While these giants appear very powerful, they are mere shadows magnified by our insecurity, fear and unrecognized potential. They are the few and we are the many. When we stop playing along with this virtual fantasy of grandeur, their world dissolves.
Psychopaths do not possess the creativity that we have. Without an ability to feel deeply, they can’t generate life and all they can do is mimic and feed off of others. Carl Jung once said, “one does not become enlightened by imagining figures of light, but by making the darkness conscious.” The cure is in the pain and our conscious suffering. Our ability to feel our own pain awakens compassion – reminds us of our inherent obligation to one another. What doesn’t kill us makes us stronger and can help build a more resilient immunity. With the power of empathy and imagination that is an innate gift in all of us, we can network new pathways, creating a world that truly embodies what it is to be human.
Pathology Incorporated; The Facade Of American Democracy
With the rigged Democratic presidential nomination behind us, the US election reality show continues. The mass media is creating sensations around what has become a national embarrassment with this contest of the lesser of the two crazies. On the one hand we have Donald Trump, depicted as a quintessential narcissist and on the other, Hillary Clinton who is often portrayed as a sociopath. Hype is created by putting these labels on the candidates, pitting one personality disorder against the other.
This is a corporate sponsored election charade doing business as usual and distracting people from the real power behind the veil. In The Corporation: The Pathological Pursuit of Profits and Power, filmmaker and law professor Joel Bakan (2004)examined the consistent character attributes of corporations and concludes that if they were a human, they are a textbook example of a psychopath.
Psychopathy is a personality disorder that cuts off those who are affected by it from the emotional reality of others. The core of this pathology is the inability to put oneself into someone’s shoes. Empathy is the seat of conscience, and without it comes an incapacity for love. These candidates are just symptoms of a system run by corporations, which is now revealing the full fledge of pathology incorporated here in the United States. When a society lacks understanding of the depth of its darkness, this unaccounted power sees no bounds for its pursuit of a single vision.
The Perversion of Humanity
In his seminal work The Mask of Sanity, first published in 1941, psychiatrist Hervey M. Cleckleyarticulated how, among the traits of psychopathy such as superficial charm, emotional poverty and egocentricity, its essential characteristic lies in its deceitful nature.
Those who are devoid of empathy hide their lack of internal structure in a façade of normalcy. By emulating good human attributes, these unknown members of society prey on the rest. They have found the best way to mask their vice by infiltrating governments and directly altering the definition of the norm. Through control of monetary supply and monopoly over markets, these 1% pathological beings have financially engineered a perversion of humanity through a pyramid Ponzi scheme of Darwinian survival of the most callous and cunning. By turning morality upside down, they not only make their deviance invisible, but actively incentivize these disturbing characters, making all people engage in this race to the bottom.
By seducing masses with the allure of middle class lifestyle and material pursuit of happiness, the beast within humanity unlocked citizens’ unconscious desires and opened the door to unbridled commercial interests. The government that was hijacked by corporate lobbyists established a symbiotic relationship with its own people, making voters become the host, through manufacturing consent. While people are busy chasing the American dream in shopping malls and trying to climb a corporate ladder of success, these parasites latch onto the vulnerable, sucking the blood of innocents in the Middle East and the laboring sweat of disadvantaged populations around the world.
Like adventurous American eagles who have no fear of soaring too high, corporate patronage networks with wings of oil companies on the right and the Wall Street banking industries on the left take flight to conquer the globe. Vultures circle around the Bermuda Triangle of the TPP, TTIP and TISA, creating a vortex of unregulated greed. When their conquest turns sour, they make sure they get bailed out by the taxpayers and then move on to their next fraud or crime.
Devouring Conscience
Waves of whisleblowers in recent years have brought true resistance against this corporate takeover of democracy. Human beings who feel the pulse of conscience in the heart are a real threat to this authoritarian state that works in secrecy. They punish with impunity these truthtellers who reveal their crimes. Chelsea Manning, who shed light on government illegal wars, is in prison serving 35 years, being placed in a solitary cage and denied basic care. After her recent suicide attempt, the state tried to punish her even more. Edward Snowden, who blew the whistle on NSA mass surveillance remains in exile.
Admins of this merciless autocratic system deflect issues and project characteristics that belong to them. With smear campaigns and character assassination, the mainstream media attacks anyone who dares to hold an accurate mirror of what they are really doing. WikiLeaks, the publisher of last resort, has been a target of this coordinated assault. After the organization released troves of US classified military records of the Afghan war, joint Chief of Staff Admiral Mike Mullen saidWikiLeaks might have blood on their hands, when in reality these documents revealed the US Government’s own murder of 20,000 people by assassination, civilian massacres and night raids.
This assault on global free press never ends. Called by US officials a ‘high tech terrorist’ and incited for assassination, WikiLeaks editor in chief, Julian Assange remains detained in the Ecuadorian embassy, despite a UN Working Group’s ruling clearly stating this detention as unlawful. Recent WikiLeaks’publication of DNC emails that led to the forced resignation of top officials has shown the Democratic Party’s collusion with corporate media in undermining Bernie Sanders’ campaign and rigging the presidential primary.
This Democratic Party’s habit of destabilizing democracy is nothing new. A lawsuit was filed against their use of ‘groundless and abusive litigation’ to bankrupt third party Ralph Nader’s campaign, obstructing his ballot access in 18 states during his run in 2004. Back then, pundits and progressive news outlets in unison kept silent about such injustice and instead created an echo chamber, calling him a spoiler.
We are now seeing the same old knee-jerk reaction. In response to the DNC leaks, the establishment media and the left has attacked Assange and Green Party presidential candidate Jill Stein, slandering them as colluding with Vladimir Putin. New DNC chair Donna Brazile has now joined the attack, twisting reality by callingAssange a cyber-criminal. These apologists for power pledge their allegiance to the Clinton Foundation – the flag of Goldman Sachs, Google and Exxon, and fiercely defend this pathological pursuit of the Corporate States of America.
The Barbarian Within
These developments are all a part of their psychological makeup. Psychopathic abuse unfolds in three stages, defined as ‘idealization, devaluation and discard.’ With charm and feigned empathy, they allure potential victims into their snare. As soon as they seal the relationship and take what they want, they begin looking for their next victim to exploit.
At one point, sooner or later, the mask of the psychopath slips and the monster beneath reveals itself. Psychopathy has been running throughout the history of America, dragging people into a mission of Manifest Destiny. The indigenous of this country were terrorized and murdered, while blacks were enslaved and brutalized. The poor and people of color have been continuously abandoned and impoverished. They have all seen the barbarians inside Western civilization and now even the crumbling middle class is beginning to see the face of this savage beast.
Obama’s campaign was a mastery of deception. Now, the devaluation is moving into the final stage. The masks are blowing off and corporate masters behind the scenes don’t even care to maintain a semblance of democracy anymore. The lesser of two evils in this election cycle, showcasing the two most disliked presidential candidates in US history, is a testimony of this.
Trump blazes through his campaign trail with bombardment of racism, bigotry and word salads of mouthy contradictions. When reflecting on the death of Muammar Gaddafi in Libya, Hillary Clinton cackled; “We came, we saw, he died”- showing a total lack of compassion and laughing at the role she played then as secretary of state in the complete destruction of a country and leader, who might still be alive if he hadn’t challenged the petrodollar hegemony by trying to create a new currency for Africa. The US election as a center of oligarchic control is now having its own pathology and disdain for life in full display. When the mask of sanity slips, the system comes into the final stage – the discard phase.
Cure Is in the Pain
It is clear now that this election is just another smoky mirror, yet what is not generally known is that the American people have already been discarded. Many are still enmeshed in the illusion or simply refuse to see it. In the eyes of corporate ‘personhood’, which is nothing but a legal fiction, our humanity is becoming more and more disposable. This artificial entity is run by cannibalistic desires and cunning intelligence with no heart that can feel for others. It is driven by relentless destructive urges for control and power, even if it may destroy the world and itself in the process.
Bakan (2004) argues how they are “in a word, inhuman—and its goal, as Noam Chomsky states, is to ‘ensure that the human beings who [it is] interacting with, you and me, also become inhuman’”. We are now seeing this vision of a future with trans-humanism agendas. Cybernetic technology and Artificial Intelligence is attempting to marry machines with humans, while efforts like Bill Gates’ vaccine project, presented as saving lives, apparently aims to depopulate through what amounts to 21st century eugenics. With this trend, a plan to reprogram humanity to become just a cog in a wheel seems to have reached a new stage.
When robots replace labor, corporations won’t need workers anymore. When drones and missiles are automated, they don’t need soldiers anymore who are still willing to fight for this bloody pathological pursuit of power. Psychopaths move on when resources are depleted or their targets just aren’t useful anymore. They have no remorse for victims of their crimes; the unemployed, elderly, indebted, foreclosed and veterans with PTSD.
Where does this lead us? Many who have endured psychopathic abuse in their personal life escaped these toxic relationships and became survivors. They woke up in the midst of horror and found the strength to defy illegitimate authority that had been installed in their minds. Hope now can be found in the courage of our fellow humans and simply in walking away from a society maligned with these heartless agendas.
We can regain sanity by breaking the entrapment of this agreement and change the terms of engagement. While these giants appear very powerful, they are mere shadows magnified by our insecurity, fear and unrecognized potential. They are the few and we are the many. When we stop playing along with this virtual fantasy of grandeur, their world dissolves.
Psychopaths do not possess the creativity that we have. Without an ability to feel deeply, they can’t generate life and all they can do is mimic and feed off of others. Carl Jung once said, “one does not become enlightened by imagining figures of light, but by making the darkness conscious.” The cure is in the pain and our conscious suffering. Our ability to feel our own pain awakens compassion – reminds us of our inherent obligation to one another. What doesn’t kill us makes us stronger and can help build a more resilient immunity. With the power of empathy and imagination that is an innate gift in all of us, we can network new pathways, creating a world that truly embodies what it is to be human.
Monday, September 5, 2016
SC136-10
http://www.globalresearch.ca/americas-wars-can-we-please-get-rid-of-the-pledge-of-allegiance/5543745
America’s Wars: Can We Please Get Rid of the “Pledge of Allegiance”?
The Pledge of Allegiance is not an expression of patriotism. It is a loyalty oath that one normally associates with totalitarian regimes. People who love freedom, should be appalled by the idea our children are being coerced to stand and declare their support for the state. This is the worst form of indoctrination and it is completely anathema to the principals articulated in the US Constitution and the Bill of Rights. I cannot imagine outspoken libertarians like Thomas Jefferson or Tom Paine ever proclaiming their loyalty to the state when they correctly saw the state as the greatest threat to individual freedom. Which it is.
Now I know that many people think the Pledge is simply an affirmation of their respect for the flag, their love for the country, and their gratitude to the men and women who fought in America’s wars. But that’s not what it is. The Pledge is an attempt to impose conformity on the masses and compel them to click their heels and proclaim their devotion to the Fatherland. That’s not how it’s supposed to work in a democracy. In a democracy, the representatives of the state are supposed to pledge their loyalty to the people and to the laws that protect them. That’s the correct relationship between the state and the people. The Pledge turns that whole concept on its head.
Now I’d have no problem if our schoolchildren recited the Preamble to the Declaration of Independence before class every day:
“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.
That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.”
That’s great stuff, unfortunately, the people who run this country would never allow it. They’d never allow our kids to recite an incendiary, revolutionary document like that every day for fear it would incite violence against the state. What they want is “good Germans”, not revolutionaries, not freedom-loving populists, and not well-informed, critical thinking individuals who can see through the sham of their jingoistic propaganda. They want people who are going to follow the rules, do what they’re told, fight the wars, and perform their worktime drudgery for 30 or 40 years until they’re carted off to the glue factory. That’s what they want. Reciting the Pledge fits perfectly with this dumbed-down version of permanent indentured servitude. It provides the ideological foundation for bovine acquiescence to the demands of the state and the crooks who run it behind the tri-color banner.
The fact that institutions like the Pledge are never challenged in a public format, points to deeper problems with the media and the way our kids are being educated. And while I don’t have time to talk about that now, it makes me wonder where are the people to question these silly recitations that undermine democracy and personal liberty? Why are their voices never heard?
I can’t answer that, but when I see the state deliberately eviscerating habeas corpus and locking away terror suspects for life with no evidence, no witnesses, no due process, no presumption of innocence, no way to defend themselves or claim their innocence in a court of law or before a jury of their peers–when I see the US state assuming the same unchecked, tyrannical powers as all of the dictatorships that went before them– I grow increasingly concerned that this lack of critical thinking is costing the country quite dearly. We are on the verge of losing what-little democracy we have left because people are incapable of looking around and asking ‘what the hell is going on?’
Pulling your head out of the sand and asking questions is not a sign of disloyalty. It’s a sign of intelligence, the kind of intelligence this country needs to stop the bloody wars and get back on track.
So next time you’re in a situation where you’re asked to stand up and recite the pledge, just pause for a minute and ask yourself what it really means. Is it really an expression of “love of country” or a is it a vacuous and demeaning exercise in nationalism that should be done away with ASAP?
I’d say, it’s the latter.
America’s Wars: Can We Please Get Rid of the “Pledge of Allegiance”?
The Pledge of Allegiance is not an expression of patriotism. It is a loyalty oath that one normally associates with totalitarian regimes. People who love freedom, should be appalled by the idea our children are being coerced to stand and declare their support for the state. This is the worst form of indoctrination and it is completely anathema to the principals articulated in the US Constitution and the Bill of Rights. I cannot imagine outspoken libertarians like Thomas Jefferson or Tom Paine ever proclaiming their loyalty to the state when they correctly saw the state as the greatest threat to individual freedom. Which it is.
Now I know that many people think the Pledge is simply an affirmation of their respect for the flag, their love for the country, and their gratitude to the men and women who fought in America’s wars. But that’s not what it is. The Pledge is an attempt to impose conformity on the masses and compel them to click their heels and proclaim their devotion to the Fatherland. That’s not how it’s supposed to work in a democracy. In a democracy, the representatives of the state are supposed to pledge their loyalty to the people and to the laws that protect them. That’s the correct relationship between the state and the people. The Pledge turns that whole concept on its head.
Now I’d have no problem if our schoolchildren recited the Preamble to the Declaration of Independence before class every day:
“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.
That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed, That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.”
That’s great stuff, unfortunately, the people who run this country would never allow it. They’d never allow our kids to recite an incendiary, revolutionary document like that every day for fear it would incite violence against the state. What they want is “good Germans”, not revolutionaries, not freedom-loving populists, and not well-informed, critical thinking individuals who can see through the sham of their jingoistic propaganda. They want people who are going to follow the rules, do what they’re told, fight the wars, and perform their worktime drudgery for 30 or 40 years until they’re carted off to the glue factory. That’s what they want. Reciting the Pledge fits perfectly with this dumbed-down version of permanent indentured servitude. It provides the ideological foundation for bovine acquiescence to the demands of the state and the crooks who run it behind the tri-color banner.
The fact that institutions like the Pledge are never challenged in a public format, points to deeper problems with the media and the way our kids are being educated. And while I don’t have time to talk about that now, it makes me wonder where are the people to question these silly recitations that undermine democracy and personal liberty? Why are their voices never heard?
I can’t answer that, but when I see the state deliberately eviscerating habeas corpus and locking away terror suspects for life with no evidence, no witnesses, no due process, no presumption of innocence, no way to defend themselves or claim their innocence in a court of law or before a jury of their peers–when I see the US state assuming the same unchecked, tyrannical powers as all of the dictatorships that went before them– I grow increasingly concerned that this lack of critical thinking is costing the country quite dearly. We are on the verge of losing what-little democracy we have left because people are incapable of looking around and asking ‘what the hell is going on?’
Pulling your head out of the sand and asking questions is not a sign of disloyalty. It’s a sign of intelligence, the kind of intelligence this country needs to stop the bloody wars and get back on track.
So next time you’re in a situation where you’re asked to stand up and recite the pledge, just pause for a minute and ask yourself what it really means. Is it really an expression of “love of country” or a is it a vacuous and demeaning exercise in nationalism that should be done away with ASAP?
I’d say, it’s the latter.
SC136-9
http://www.globalresearch.ca/low-wage-america-protracted-main-street-depression-economic-recovery-is-an-illusion/5473905
Little to Celebrate this Labor Day Weekend: Low-Wage America. Protracted Main Street Depression. Economic Recovery is an Illusion
US workers have little to celebrate this Labor Day weekend or any other one. America is being systematically thirdworldized – represented by weak unions complicit with management or none at all, unable to bargain effectively for higher wages.
Economic recovery is an illusion. A protracted Main Street Depression persists. Poverty is a growth industry. Around 23% of Americans wanting work can’t find it.
Most available jobs are rotten ones – temp or part-time low pay/poor or no benefit service ones with no futures. Conditions are getting worse, not better.
Millions of good jobs were offshored to low-wage countries. Millions more may follow. Many displaced workers remain unemployed longterm. Others finding work take huge wage cuts.
Labor force participation is the lowest in 40 years. A newNational Employment Law Project (NELP) report is titled “Low-Wage Occupations See Steepest Drop in Real Wages.”
“Stagnant wages have become a fact of life for nearly all of America’s workers, but workers in lower-paying occupations are finding it especially tough to keep up with the rising cost of living,” NELP executive director Christine Owens explained.
“Not only are their paychecks not growing, but their purchasing power has shrunk considerably, and to a far greater extent than that of higher-wage earners.”
NELP examined median hourly wage changes from 2009 – 2014 for 785 occupations – categorized into five groups with equal weighting.
It found 4% wage declines on average – low and “mid-wage” occupations hardest hit, up to 5.7%. Declines were greatest in restaurant sector jobs. Food preparation workers saw 7.7% lower incomes. For cooks, it was 8.9%.
Janitors, cleaners, personal care aides, home health workers, maids and housekeepers were hard hit. Many job categories expected to see strong growth in number of workers are experiencing above-average real wage declines.
“Five of the ten occupations projected to add the greatest number of jobs between 2012 and 2022 were at the bottom of the occupational distribution in 2014, with real median wages between $8.84 and $10.97,” NELP reported. “Six of the ten highest-growth occupations saw real wage declines of 5.0 percent or more between 2009 and 2014.”
At the same time, lowest paid workers earning poverty and sub-poverty wages saw wage declines of 1.6%. How much lower is the bottom of the barrel than already?
Minimum wage workers don’t earn enough to live on – why homelessness and hunger affect millions of Americans. Around 3.5 million men, women and children have no place to live. They sleep in parks, under bridges, in shelters, cars or on city streets.
Nearly one-fourth are military veterans. Many others are children, victims of domestic violence or mental illness sufferers – federal, state and local governments doing little or nothing to help them.
Homelessness is mainly an economic problem – caused by unemployment, underemployment and inadequate resources to live on.
During the 1950s and 1960s, government housing programs and other social services eradicated homelessness. Major cuts in these programs caused an epidemic of people unable to afford shelter.
America’s safety net is disappearing altogether. Hunger affects one in six Americans. Over 14 million children rely on food banks to eat.
Food insecurity exists in every US county nationwide – at its highest level at any time since the Great Depression. Hunger is a daily reality for around 50 million Americans – affecting 13 million households, including working ones.
Census data show poverty or borderline conditions affect around half the population. Food stamps provide a woefully inadequate $1.40 per person per meal. Food banks supplement recipients when monthly benefits run out. Most often it’s around 10 days or more before month’s end.
Official numbers understate reality. Growing millions suffer out of sight and mind. Government is dismissive at all levels.
America’s wealth disparity is unprecedented. Income inequality is greater than in all other developed countries. Over three-fourths of workers live from paycheck to paycheck – one missed one away from homelessness, hunger and despair.
Neoliberal harshness is official US policy. Bipartisan complicity force-feeds it – institutionalized when vital aid is needed. America wages financial war on its own people. Its social contract is on the chopping block for elimination.
Monied interests alone are served – ordinary people increasingly ignored. America’s political system is too corrupted to fix. Voters have no say whatever. Democracy is pure illusion.
Anyone believing they can change things electorally is living in a fantasy world. America’s one-party state with two wings affords voters no choice at all – no matter what candidates represent them at all levels of government.
The only solution is revolutionary change – bottom up, never top down.
Little to Celebrate this Labor Day Weekend: Low-Wage America. Protracted Main Street Depression. Economic Recovery is an Illusion
US workers have little to celebrate this Labor Day weekend or any other one. America is being systematically thirdworldized – represented by weak unions complicit with management or none at all, unable to bargain effectively for higher wages.
Economic recovery is an illusion. A protracted Main Street Depression persists. Poverty is a growth industry. Around 23% of Americans wanting work can’t find it.
Most available jobs are rotten ones – temp or part-time low pay/poor or no benefit service ones with no futures. Conditions are getting worse, not better.
Millions of good jobs were offshored to low-wage countries. Millions more may follow. Many displaced workers remain unemployed longterm. Others finding work take huge wage cuts.
Labor force participation is the lowest in 40 years. A newNational Employment Law Project (NELP) report is titled “Low-Wage Occupations See Steepest Drop in Real Wages.”
“Stagnant wages have become a fact of life for nearly all of America’s workers, but workers in lower-paying occupations are finding it especially tough to keep up with the rising cost of living,” NELP executive director Christine Owens explained.
“Not only are their paychecks not growing, but their purchasing power has shrunk considerably, and to a far greater extent than that of higher-wage earners.”
NELP examined median hourly wage changes from 2009 – 2014 for 785 occupations – categorized into five groups with equal weighting.
It found 4% wage declines on average – low and “mid-wage” occupations hardest hit, up to 5.7%. Declines were greatest in restaurant sector jobs. Food preparation workers saw 7.7% lower incomes. For cooks, it was 8.9%.
Janitors, cleaners, personal care aides, home health workers, maids and housekeepers were hard hit. Many job categories expected to see strong growth in number of workers are experiencing above-average real wage declines.
“Five of the ten occupations projected to add the greatest number of jobs between 2012 and 2022 were at the bottom of the occupational distribution in 2014, with real median wages between $8.84 and $10.97,” NELP reported. “Six of the ten highest-growth occupations saw real wage declines of 5.0 percent or more between 2009 and 2014.”
At the same time, lowest paid workers earning poverty and sub-poverty wages saw wage declines of 1.6%. How much lower is the bottom of the barrel than already?
Minimum wage workers don’t earn enough to live on – why homelessness and hunger affect millions of Americans. Around 3.5 million men, women and children have no place to live. They sleep in parks, under bridges, in shelters, cars or on city streets.
Nearly one-fourth are military veterans. Many others are children, victims of domestic violence or mental illness sufferers – federal, state and local governments doing little or nothing to help them.
Homelessness is mainly an economic problem – caused by unemployment, underemployment and inadequate resources to live on.
During the 1950s and 1960s, government housing programs and other social services eradicated homelessness. Major cuts in these programs caused an epidemic of people unable to afford shelter.
America’s safety net is disappearing altogether. Hunger affects one in six Americans. Over 14 million children rely on food banks to eat.
Food insecurity exists in every US county nationwide – at its highest level at any time since the Great Depression. Hunger is a daily reality for around 50 million Americans – affecting 13 million households, including working ones.
Census data show poverty or borderline conditions affect around half the population. Food stamps provide a woefully inadequate $1.40 per person per meal. Food banks supplement recipients when monthly benefits run out. Most often it’s around 10 days or more before month’s end.
Official numbers understate reality. Growing millions suffer out of sight and mind. Government is dismissive at all levels.
America’s wealth disparity is unprecedented. Income inequality is greater than in all other developed countries. Over three-fourths of workers live from paycheck to paycheck – one missed one away from homelessness, hunger and despair.
Neoliberal harshness is official US policy. Bipartisan complicity force-feeds it – institutionalized when vital aid is needed. America wages financial war on its own people. Its social contract is on the chopping block for elimination.
Monied interests alone are served – ordinary people increasingly ignored. America’s political system is too corrupted to fix. Voters have no say whatever. Democracy is pure illusion.
Anyone believing they can change things electorally is living in a fantasy world. America’s one-party state with two wings affords voters no choice at all – no matter what candidates represent them at all levels of government.
The only solution is revolutionary change – bottom up, never top down.
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