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http://theragblog.blogspot.com/search/label/Terminal%20Capitalism

Terminal Capitalism

The capitalist imperative:
Grow or die

Richard Heinberg, director of the Post Carbon Institute, begins his book, The End of Growth, as follows: "The central assertion of this book is both simple and startling: Economic growth as we have known it is over and done with." He then presents over 300 pages of various kinds of supportive evidence backing up this conclusion. I will touch on some evidence in this essay, while saying that since the book was published in 2011, the evidence in support of this conclusion seems stronger than ever.

If that is indeed the case, the end of growth is very bad news for capitalism itself, since capitalism is based on an inherently expanding economy that needs to keep growing or it dies. The way the capitalist system works is basically that bankers or finance capitalists extend credit; they lend money that is invested in the production of goods that are then sold to pay off the loans plus make a profit sufficient to pay back the lenders, with enough left over to reward the lenders with interest.

If and when such a system starts contracting, profits suffer or may disappear entirely and there is an economic crisis until confidence in the system is restored and growth resumes. It is in the nature of the capitalist system to be subject to periodic booms and busts that comprise the capitalist business cycle. Most economists including Marx have been well aware of this fact. The remedy proposed by Keynes was to stimulate a contracting economy with government-sanctioned deficit spending, as I described in "Terminal Capitalism / Part 1."

However, if the contracting global economy is unable to grow in real material terms due to some deeply rooted physical constraint or resource limit, then no governmental policy can revive the growth on which the system depends.

Governments can print money and inject it into the economy to try to revive spending, but If there is not enough cheap energy to permit a real economic expansion in terms of marketable goods, then the money will be spent sooner or later. Then the deception will be revealed by inflation due to a surplus of money and a shortage of goods.

There is a factor called the velocity of circulation of money, which is really psychological in nature amounting to a shift in consumer spending behavior from saving to spending. That leads easily to inflation or hyperinflation initiated when the public finally understands that there is more money than goods like food available for purchase. Governments can revive spending behavior by printing sufficient money, but they can't restore genuine prosperity without more real goods being produced and made available for purchase.

The remainder of this essay will attempt to explain the physical factors which are working in opposition to a real revival of the global economy in terms of its ability to expand the production of material goods. If that can't happen, then capitalists can no longer earn interest on their investments. Whenever a dollar invested or deposited in a bank is seen to buy less than before it was invested or banked, the incentive to invest, on which capitalism depends, disappears and the urge to buy commodities like gold that preserve their exchange value increases.

Growth may have already reached its limits and stopped forever! The global economy as a whole has not expanded since the energy and economic crisis hit in 2008. The numbers tell the tale. Stuart Staniford's excellent blog, Early Warning, tracks many interesting and important trends, including in this case the volume of world trade as measured by the WTO.

The following is Staniford's description of the situation about six months ago, featuring a seasonally corrected chart which shows that the volume of global trade seems to have stalled at about the same level that it had reached in mid-2008. Since the BRIC group has done a little better than most, it follows that the USA, Europe, and Japan have lost ground.

"...after the 2008 financial crisis, global trade collapsed and then recovered strongly till early 2011. For the last eighteen months, however, it's been basically stagnant. This likely reflects a combination of a sluggish U.S. recovery, a double-dip recession in Europe, and the slowdown in China. The global economy continues to act like an engine firing on only three cylinders."

Grounds for denial

Anyone familiar with world history knows that both the global economy and human population have been growing, at least fitfully, for thousands of years, and that the rate of growth accelerated greatly following the industrial revolution in England hundreds of years ago, with the advent of steam power and vast factories and improved machines to produce ever cheaper marketplace goods..

We like to tell ourselves that continual progress in science and technology will keep paying off by creating the new energy sources and the improved technology that we need to maintain ourselves and solve our problems, especially when we take care to grow in a smart way with sensible restraints.

When there were few factories, there was little need to regulate toxic discharges into lakes and rivers. Now with many more people and factories, most of us are willing to accept that stronger regulation is needed for the benefit of the general public. Increasingly we can see there are limits imposed by nature. Expansion of industry in China using coal for power is becoming a major health threat.

Few economists in the day of Adam Smith or Marx, with the notable exception of Malthus, could foresee a day that there would be any important limits to economic expansion that could not be overcome by human ingenuity and continually improving technology. If there were such limits, it was presumed that these were local limits that could be dealt with rather easily. If natural resources such as metal mines were exhausted in one area, one could always move to a fresh area, and use the advantages of continually improving technology to keep production expanding, ad infinitum.

In reality it is found that technology tends to harvest the low hanging fruit in terms of available resources first and then moves on. While there was an abundance of cheap energy available, this exhaustion of resources and a simultaneous increase in unwelcome consequences could be concealed for a time. In the USA, there has been a well-funded, right-wing corporate disinformation campaign to lead the public to deny that burning fossil fuel is changing the climate for the worse. Now people are beginning to realize the unhappy truth.

According to a growing number of skeptics, including Heinberg, the fatal flaw of economics, as traditionally practiced, is that it is an abstract discipline, oblivious to the limits of the finite world that it claims to study and to model. Since economics is a system that assumes exponential growth, it is apparent that at some point an expanding economy has to run into natural resource limits on our finite planet. Most people have assumed that most such limits were far in the future.

As individuals, the human participants in the growth process have been unlikely to be very conscious of global limits; they were mostly concerned with the everyday challenges of surviving, or raising and feeding a family. However, now, when there are more than 7 billion people collectively involved in an effort to keep the global economy growing to satisfy their own needs, limits are starting to crop up everywhere.

Scientists have been warning us,
but are we ready to listen yet?

The end of growth is not a far-fetched possibility. In fact, there have been a number of credible predictions that this is bound to happen sooner or later because of the increasingly serious side effects of growth itself. The 1972 book The Limits to Growth by the Club of Rome used a computer model to arrive at the conclusion that there are limits to the expansion of the global economy imposed by nature that are likely to lead to overshoot and collapse within the lifetimes of many now living .

The conclusions were updated in a sequel 30 years later. "Overshoot: The Ecological Basis of Revolutionary Change" is another classic work that pointed out the radical implications of an expanding human population overshooting the resources of a finite planet, followed by collapse.

There has been no shortage of warnings from the scientific community that continuing economic growth would lead to disaster. It has now been more than 20 years since a majority of the world's then-living Nobel Prize-winning scientists issued the "1992 World Scientists' Warning to Humanity". This is taken from the introduction:

Human beings and the natural world are on a collision course. Human activities inflict harsh and often irreversible damage on the environment and on critical resources. If not checked, many of our current practices put at serious risk the future that we wish for human society and the plant and animal kingdoms, and may so alter the living world that it will be unable to sustain life in the manner that we know. Fundamental changes are urgent if we are to avoid the collision our present course will bring about.
One might imagine that when the world's most eminent scientists warn humans that they had better shift course to avoid a looming environmental disaster, their warning would get a lot of media attention. That didn't happen. The World Scientists' warning was mostly ignored because it interfered with the nearest thing most humans have to a global religion; a belief in endless progress based on the blessings of modern science in combination with expanding world trade.

New investment based on improvement in technology has always brought benefits like easy communication and an improved standard of living. The fact that the few capitalists who maintain control of the investment and economic expansion process tend to be the major beneficiaries has tended to be overlooked.

Global warming by itself probably has the potential to cripple the global economy, as does human population overshooting food supply. With a global population of 7.5 billion, we see natural limits of one kind or another cropping up everywhere and interacting to create converging crises. More and more, solving one growth-related problem tends to create other problems. Trying to deal with any one limit tends to reveal other limits.

These include such factors as a limit on arable land for farming, potable water availability, increasing soil erosion and depletion, air and water pollution, the fertilizer needed to maintain high crop yield, and the list goes on. "Convergent Crises and Why We Deny Them" discusses the fact that these limits tend to interact.

An excellent and easily accessible explanation of the natural limits to growth by Charles Hall (see below) and John Day is here.

If we are very lucky, the global economic expansion forces will be forced into an orderly retreat before they overshoot the resource base. If not, humans everywhere are likely to face an abrupt economic collapse in which the decline is a lot steeper than the preceding economic expansion. This tendency for decline to be faster than growth has been called the Seneca Effect.

Why expansionist economics can't deal with a
falling energy return on energy investment (EROI)

Rising energy cost, and oil in particular, is the factor that has the greatest ability to interfere with business as usual. The historical rate of global growth has fallen sharply in the last decade, and an important factor is the economic burden of rising energy costs. In Terminal Capitalism / Part 1, I cited the January 26, 2012, article in the distinguished science journal Nature by James Murray and David King, titled "Oil's tipping point has passed." This paper points out that the global economy seems to have permanently shifted to slower growth after the world supply of cheap conventional oil peaked in 2005, when we started to use much higher priced oil, like the oil we get by drilling in the Gulf of Mexico.

The International Energy Agency has made it very clear that the global economy is at risk when oil prices are greater than $100 per barrel -- as they have been in recent years, and will surely continue to be, given the inelastic response of global production. Historically, there has been a tight link between oil production and global economic growth. If oil production can’t grow, the implication is that the economy can’t grow either. This is such a frightening prospect that many have simply avoided considering it.
Domestic oil used to be very abundant and cheap to produce in the United States; however U.S. oil production peaked in 1970, so the U.S. turned to cheaper imported oil. Now the cost of imported oil has risen sharply too, especially after the cheap conventional oil production hit its global peak.

The cost of oil or any other traded commodity is generally determined by the amount of work that it takes to produce that commodity. The concept of "energy return on investment" or EROI essentially means the payback ratio, or the amount of energy you need to put in in order to get even more energy back out.

The EROI concept is important from an economic standpoint whether it is applied to drilling for oil, or for the work expended in building a dam to generate hydroelectric power, or when building and using a wind turbine, or any other means of generating power. The April 2013 issue of Scientific American has an article by Mason Inman, "The True Cost of Fossil Fuels," which explains the EROI concept and its important implications for our existing economy. The same EROI concept has important implications for any human economy, whether ancient or modern, capitalist or socialist.

The EROI concept was developed by environmental scientist Charles Hall, who says of oil and gas, "Everywhere you look, the EROI is declining."

The Scientific American article is accompanied by an interview with Hall where he explains that different EROIs support different kinds of economic organization, and the mostly unwelcome economic implications of the currently falling EROI in the USA. As Hall says in this interview,

We know that the middle class has not increased its income now for 20 years. Behind that -- not always the immediate cause, but looking over the shoulder of the causes -- I find the decline in the availability of energy. It's terrifying to people -- politicians and economists -- who base everything on growth. I think they won't talk about it because the concept is terrifying.

Most people have little idea of how rapidly the EROI has been falling, and what this steep rate of decline implies for the U.S. economy, and indeed for the global economy. Richard Heinberg's book The End of Growth, in Chapter 3, gives some numbers and EROI estimates by Hall (pages 118-119). It is estimated that circa 1930 we could get back as much as 100 barrels of oil for every barrel we expended through drilling, giving an EROI of 100.

By 1970, this had fallen to about a 30-to-one payback or EROI. By 2005, the EROI had fallen domestically to about 15, A fairly recent paper by Hall, et al, indicates a current U.S. oil and gas EROI below 11. However the EROI for imported oil produced where the fields are less depleted has stayed higher and is now estimated by the Scientific American article to globally be about 16.

Meanwhile, the EROI from coal is still about 20, as is the payback ratio from wind in a good location. Photovoltaic solar EROI is much lower at about six. These numbers are rough averages and of course vary with location. Chinese coal payback economics is different from that in the USA, but these numbers give a rough idea, and indicate a steady EROI decline.

A falling EROI tends to show up as a price increase for everything. There is no way to avoid using increasingly costly liquid fuels to transport coal and in the course of producing and transporting all other commodities.

The steady decline in EROI for liquid fuels is particularly worrisome because almost all global transportation is powered by liquid fuels. That is why an economic peak to the global oil supply can cripple the world economy. Even a nation that uses a lot of coal for power like China is in trouble if it tries to convert its coal energy into liquid fuel energy. It can be done, but this results in a much lower EROI for the coal-based liquid. Liquid fuel energy, electric power energy, and thermal energy each have their own EROI economics.

It is estimated that a modern industrial economy needs an EROI of at least five or greater to function properly. If global oil supplies have already fallen to only 16, and are still falling pretty fast, it is apparent that some economies, and especially an oil-addictive economy like the USA, is in trouble no matter what kind of leadership it has. This is true until the economy has the time needed to make a transition which, as the "Hirsch report" indicates, necessarily requires several decades of serious effort.

There is a theory of maximum possible complexity of a society related to the EROI level at its economic base. Without economic growth, the whole system, what was once termed the "political economy" runs into political trouble too. You can't have a very technically sophisticated and centralized economy based on a low EROI. Nor can you maintain a complex legal and military support structure for global finance capital investment. Without cheap energy you cannot have a global system of finance capital that maintains an orderly system of global trade with its highly sophisticated and centralized production of complex goods.

American anthropologist and historian Joseph Tainter has written an important book, Collapse of Complex Societies in which he analyzes why civilizations like ancient Rome probably rose and fell in accord with a changing EROI, just as much as because of the abilities of their leaders. Ancient civilizations can't control the far reaches of an empire if they can't afford to feed the armies that maintain their central control.

There are analogies to be found today when the United States attempts to project its military power globally without the advantage of cheap oil. Similar limits apply when investment bankers attempt to organize complex global production systems which depend on complex global supply networks.

Why alternative energy probably
can't keep our economy growing

Since the cheap energy that built the U.S. economy is rapidly being depleted and is being replaced by more expensive energy, there is a natural desire to try to replace our energy with renewable energy, especially with wind and solar power as an alternative. How hard that would be, what it would cost, and how long it would take are the key issues.

In 2009 the Post Carbon Institute did a study of this question and put out a report, "Searching for a Miracle: Net Energy Limits and the Fate of Industrial Societies," which can be downloaded at this link. The abstract of this report concludes as follows:

Perhaps the most significant limit to future energy supplies is the “net energy” factor -- the requirement that energy systems yield more energy than is invested in their construction and operation. There is a strong likelihood that future energy systems, both conventional and alternative, will have higher energy input costs than those that powered industrial societies during the last century. We will come back to this point repeatedly.

The report explores some of the presently proposed energy transition scenarios, showing why, up to this time, most are overly optimistic, as they do not address all of the relevant limiting factors to the expansion of alternative energy sources. Finally, it shows why energy conservation (using less energy, and also less resource materials) combined with humane, gradual population decline must become primary strategies for achieving sustainability.
Currently the degree of alternative energy market penetration is low and is likely to stay that way. It is possible to cover our roofs with solar panels now, but if it were not difficult and expensive to get off the grid, it would probably already be common. President Obama started advocating wind and solar alternatives when he first came into office, yet these numbers are not increasing at nearly the rate that would be needed to replace fossil fuel energy before a declining EROI interferes.

Both Germany and China have industrial polices in place that mandate switching to alternative energy as soon as possible. Germany is running into limits caused by the need for backup power when the alternative energy level reaches about 10-20%. In China, about 70% of their power now comes from coal, with imported oil used as a supplement for transportation.

Making the switch from black to green energy is creating severe air pollution from the coal used for the transition. It is true that photovoltaic solar energy has gotten a lot cheaper in the last several years, due to a big push by China to expand its alternative energy industry. China has the advantage of a command economy to promote alternative energy which the USA lacks except for sporadic and controversial attempts like Solyndra.

Since the EROI for U.S. fossil fuel energy has been falling, it is becoming more and more costly to make the transition to wind and solar power alternatives. The average U.S. family is still in debt, and without real economic growth, those who can find jobs must now often work at the minimum wage. The economy is sending the message that alternative energy is becoming less affordable, even with much less expensive silicon photo-voltaic panels made in China.

Both wind and solar energy have the disadvantage of requiring high up-front capital costs. By contrast, gas turbines are an inexpensive way to generate electric power, and the natural gas produced by hydrofracturing or "fracking," is cheap for now. However this low cost is probably unsustainable, both because of rapid horizontal well depletion and because we are drilling and depleting the best locations first.

Besides a falling EROI to power the transition to alternative energy, there are other problems. Intermittent power sources require storage or backup when the wind isn't blowing and the sun isn't shining. Texas has had a policy of subsidizing the power grid to deliver power from West Texas where wind energy is cheapest, but the grid itself is expensive and the state is strapped for cash.

At certain times of the day when the sun is shining, PV energy can already cost less than fossil fuel energy, but most people demand power when they need it. Rooftop power requires very expensive battery storage (lead acid batteries are expensive and only last about five years whereas nickel-iron batteries are durable but expensive). If the energy comes from a public power grid, a backup source of fossil fuel power is still needed due to the intermittent generation factor.

Certain types of solar energy, like home water heating and solar ovens for cooking, are already cost-effective, and will likely come into common use when people are obliged to conserve energy because of its rising cost. Better thermal insulation is likewise very cost-effective.

Capitalism has become a global Ponzi scheme

A global peak in oil production is likely to be fatal for capitalism soon thereafter, as the globally prevailing economic institution, as the author has argued here. Given the choice, it seems better to face economic crisis sooner rather than later, both in terms of the lesser total damage done and the better chances for eventual recovery. Of course such an outlook is not apt to be well received, or to be adopted as policy, but the argument seems valid.

Recently Gail Tverberg's excellent blog, Our Finite World, has done a good job of explaining and updating the problems facing an economy based on lending and credit; to generate a real return on invested capital it must necessarily face a decline in growth. The situation is outlined in her recent post, "How Resource Limits Lead to Financial Collapse." As Tverberg says; "Many from the 'peak oil' community say that what we should worry about is a decline in the world oil supply. In my view, the danger is quite different: The real danger is financial collapse coming much earlier than a decline in oil supply."

In theory, the world of banking, of finance capitalism, is supposed to be closely in tune with the physical world, since it controls and impacts the real world through investments like mines and factories that produce goods for markets and consumers with money to spend.

A close link between the world of banking and money and the real physical world was once maintained and enforced by declaring that dollars could be redeemed on demand for gold or silver. There is now nothing to link the dollars created by the Federal Reserve to the physical world. Nowadays the dollar is a fiat currency, backed up by nothing except its prevalence as the standard reserve currency used for most global trade, and the fact that it has little competition in this regard. The worth of a dollar is only to be judged by what it will buy. This has changed over time, and nearly always for the worse.

Since the availability of oil for transportation is arguably the single factor that currently limits the growth of the global economy, the real worth of a dollar might as well be judged by the fact that it will now buy about a quart and a half of Brent crude oil on the global marketplace. Since there is a long-standing agreement in place to price globally traded oil solely in dollars, and since all countries need oil, this has tended to preserve the status of the dollar as the one currency needed to buy the oil which every country needs.

In effect, this means that all dollars should really be seen as petrodollars. The dollar lacks any plausible value except for its current purchasing power in oil or other liquid fuel, which has declined sharply over the last decade.

With all this in mind, lets try to put our current global situation in perspective. The system of capitalism, which is the foundation of the global economy and world trade, needs to keep expanding to maintain its health and avoid sinking into a deflationary world depression. A handful of giant investment banks indirectly control the entire U.S. economy, because they function as the board of directors for the Federal Reserve. The unelected Fed sets the prime interest rate and regulates the creation of dollars, by allowing the banks to loan dollars into existence.

In the absence of effective banking regulation to maintain discipline, the system has become strongly biased toward permitting the infinite exponential expansion of fiat currency and investment in defiance of our finite world. In other words, the global economy has become a vast Ponzi scheme. The distinctions between investment bankers, finance capitalists, and global corporations have become blurred.

Strip away the smoke and mirrors and bankers are revealed as respectable, well-paid gamblers who risk public money on investments that are likely to fail because of a constantly falling energy return on energy investment. With the end of meaningful banking regulation, the giant investment banks have been free to place bets on practically anything that involves money, with the wagers insured by the federal government.

The biggest investment bankers and their banks are regarded as too big to fail, and so they are essentially permitted to gamble without risk. The elimination of risk has, over time, actually led them to gamble on the riskiest ventures. These tend to pay the best returns, exactly because of the high risk. This interview -- "Our System is so Flawed that Fraud is Mathematically Guaranteed" -- features Chris Martenson interviewing banking expert Professor Bill Black. It paints an appalling picture of investment banking as a racket and a confidence game, where capital investment has shifted to the areas of greatest risk.

The biggest banks now hold hundreds of trillions of dollars worth of paper agreements, pledges to pay off a huge accumulation of speculations and hedges amounting to gambling debts still on the books. These speculative paper banking agreements dwarf the entire global economy, which is only about $70 trillion a year.

Bank of America’s holding company -- the parent of both the retail bank and the Merrill Lynch securities unit -- held almost $75 trillion of derivatives at the end of June, according to data compiled by the OCC. About $53 trillion, or 71 percent, were within Bank of America NA, according to the data, which represent the notional values of the trades. That compares with JPMorgan’s deposit-taking entity, JPMorgan Chase Bank NA, which contained 99 percent of the New York-based firm’s $79 trillion of notional derivatives, the OCC data show.
This being the case, it becomes apparent that the American dollar is at the center of a vast global Ponzi scheme which can never pay back its lenders in terms of the anticipated buying power, simply because there is no longer enough cheap fossil fuel remaining for the global economy to recover after a severe crisis.

Nobody can accurately predict how long the current situation can be maintained but, given the facts of the matter, we can see that there is certainly going to be a global economic crisis. Only the timing, which is based on investor psychology and the Federal Reserve's ability to keep the game going, is uncertain.

To sum up the situation we face, the scientists are warning us that even at best, a well-managed global economy can only avoid a severe environmental crisis for perhaps three more decades, because of the fundamental limits of nature. However, the chances of our poorly managed system of global capitalism lasting even that long are slight. Given the time typically needed to recover from a severe economic crisis like the Great Depression, this suggests that a severe global economic crisis or collapse must put an end to capitalism as we know it in the not very distant future.

James Howard Kunstler has outlined some of the social response scenarios in his books The Long Emergency and Too Much Magic. The potential for transition communities to help us through the hard times to come are a topic of frequent discussion on Resilience.org, sponsored by the Post Carbon Institute, a think tank devoted to coping with these sorts of problems.

Local economies centered around local agriculture and local production of the goods needed for survival are likely to be an important part of our future. We cannot start planning soon enough.

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http://www.globalresearch.ca/the-media-consensus-behind-militarism/5330780

The Media Consensus Behind Militarism

While the U.S. media has some spirited debate over politics and social issues – i.e. Fox News vs. MSNBC – there remains a broad consensus about foreign adversaries whose behavior is almost always cast in the harshest light, a reality that colors how America reacts to the world.

I spent years as a political pundit on mainstream TV – at CNN, Fox News and MSNBC. I was outnumbered, outshouted, red-baited and finally terminated. Inside mainstream media, I saw that major issues were not only dodged, but sometimes not even acknowledged to exist.

Today there’s an elephant in the room: a huge, yet ignored, issue that largely explains why Social Security is now on the chopping block. And why other industrialized countries have free college education and universal healthcare, but we don’t. It’s arguably our country’s biggest problem – a problem that Martin Luther King Jr. focused on before he was assassinated 45 years ago, and has only worsened since then (which was the height of the Vietnam War).

That problem is U.S. militarism and perpetual war.

In 1967, King called the United States “the greatest purveyor of violence in the world today” – and said, “A nation that continues year after year to spend more money on military defense than on programs of social uplift is approaching spiritual death.”

Nowadays MSNBC hosts yell at Fox News hosts, and vice versa, about all sorts of issues – but when the Obama administration expanded the bloody war in Afghanistan, the shouting heads at both channels went almost silent. When Obama’s drone war expanded, there was little shouting. Not at MSNBC, not at Fox. Nor at CNN, CBS, ABC or so-called public broadcasting.

We can have raging debates in mainstream media about issues like gun control and gay marriage and minimum wage, but when the elites of both parties agree on military intervention – as they so often do – debate is nearly nonexistent. Anyone in the mainstream who goes out on a limb to loudly question this oversized creature in the middle of the room known as militarism or interventionism is likely to disappear faster than you can say “Phil Donahue.”

I know something about mainstream journalists being silenced for questioning bipartisan military adventures because I worked with Phil Donahue at MSNBC in 2002/03 when Bush was revving up the Iraq invasion with the support of Democratic leaders like Joe Biden, John Kerry, Hillary Clinton and Harry Reid. That’s when MSNBC terminated us for the crime of JWI. Not DWI, but JWI – Journalism duringWartime while Independent.

JWI may be a crime in mainstream media, but it’s exactly the kind of unauthorized, unofficial coverage you get from quality independent media today and from un-embedded journalists like Jeremy Scahill, Dahr Jamail and Glenn Greenwald.

Unfortunately, many liberal journalists who were vocal about war, human rights and civil liberties during the Bush era lost their voices as Obama continued and, in some cases, expanded Bush’s “War on Terror” policies. It says something about the lack of serious national debate on so-called national security that last month one of the loudest mainstream TV news questioners of the president’s right to assassinate Americans was Sean Hannity on Fox. That’s obscene.

And it says something about mainstream TV that the toughest, most consistent questioners of militarism and defenders of civil liberties are not on a news channel – they’re on the comedy channel. A few weeks ago, I watched a passionate Jon Stewart taking on the U.S. military budget: “We already spend more on defense than the next 12 countries combined, including China, including Russia. We’re like the lady on Jerry Springer who can’t stop getting breast implants.” (On screen was a photo of the Springer guest.)

What our mainstream media so obediently call the “War on Terror” is experienced in other countries as a U.S. war OF terror – kidnappings, night raids, torture, drone strikes, killing and maiming of innocent civilians – that creates new enemies for our country. Interestingly, you can easily find that reality in mainstream media of allied countries in Europe, but not in the mainstream media of our country. Needless to say, it’s our country that’s waging this global perpetual war.

In a democracy, war must be subjected to questioning and debate. And not just on the comedy channel.

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http://carolynbaker.net/2013/04/07/the-five-stages-of-collapse-by-dmitry-orlov-reviewed-by-carolyn-baker/

The Five Stages Of Collapse

Many of us who have been researching collapse for a decade or more repeatedly use the word in writing, speaking, and daily conversation, but few of us have the opportunity to define it with such precision or personal experience as one finds in Dmitry Orlov’s forthcoming book Five Stages of Collapse: A Survivor’s Toolkit (New Society Publishers, 281 pages). I first heard of Dmitry when I was writing for From The Wilderness in 2005 after FTW published “Post-Soviet Lessons For A Post-American Century,” one of Orlov’s first articles in the United States naming our predicament and likely outcome.

Since then I have been a huge fan of Dmitry’s work, and I must concur with Richard Heinberg who says, “Even if I believed collapse were impossible I’d still read everything Dmitry Orlov writes: he’s that entertaining.” Incisive articulation of reality tempered with irrepressible humor and sarcasm define his writing style and not only compel us to stay with what some describe as a “dark Russian perspective,” but reveal a man who has found a way to live with what is so and navigate it with buoyant humanity.

The Five Stages of Collapse is nothing less than a definitive textbook for a hypothetical course entitled “The Collapse Of Industrial Civilization 101” or perhaps a bible of sorts for an imaginary “Institute of Collapse Studies.” While to my knowledge no such courses or organizations presently exist, this book would be an essential aspect of any such entity’s credibility.

Early on, Orlov clearly and cogently defines collapse in general then proceeds to demonstrate the five stages or aspects of civilization in which it is almost certain to unfold: Finance, commerce, politics, society, and culture. In addition, he provides a variety of options for how these aspects of collapse might be navigated, attended by an actual case history relevant to each one. His intention in writing the book can best be summarized by a statement made in the book’s Afterword: “There is no agenda here — just the assumption that collapse will happen, the conjecture that it can be analyzed as unfolding in five distinct phases and, based on quite a bit of research, the conclusion that each phase will require a different set of adaptations from those who wish to survive it.”

Prior to launching into the Five Stages, Orlov states that before arguing for imminent collapse, we must be convinced of the finitude of fossil fuels and other resources, and we must understand that as resources become increasingly scarce, the capacity for global industrial growth ultimately vanishes. And while coming to terms with these two realities overwhelmingly advances the certainty of collapse, nothing persuades us like our own personal experience.

Once we have realized the extent of our predicament and the compelling likelihood of the collapse of industrial civilization, we exit exclusively mental territory and enter the psychological realm, for as Orlov says, “the main impediment to grasping its significance is not intellectual but psychological.”

Enter then the Five Stages of Grief as articulated by Elisabeth Kübler-Ross or the Five Stages of Peak Oil explained by John Michael Greer in his recent book Not The Future We Ordered: Peak Oil, Psychology, And The Myth of Progress or the stages outlined by Linda Buzzell and Sarah Edwards in “The Waking Up Syndrome.” However, Orlov makes clear that what he wishes to provide in this book is not another list of emotional stages but a taxonomy or “mental milestones.” In other words, “Rather than tying each phase to a particular emotion, as in the Kübler-Ross model, the proposed taxonomy ties each of the five stages to the breaching of a specific level of trust, or faith, in the status quo.” His intention is to help us gauge our own collapse preparedness by knowing the Five Stages and how they are likely to play out, then acting accordingly.

I believe that Orlov’s taxonomy is essential, and at the same time, I do not believe enough has yet been articulated about the emotional stages of collapse. I have provided an extensive toolkit of emotional and spiritual preparation in my 2011 book Navigating The Coming Chaos: A Handbook For Inner Transition, but as collapse unfolds, much more work needs to be done on the emotional stages of it, and two of my forthcoming books Collapsing Consciously:Transformative Truths For Turbulent Times and Love In The Long Emergency will endeavor to offer even more comprehensive insights. I cannot overstate the fact that every stage of collapse is and will be fraught with myriad emotions, and assuming that one can weather them without an enormous commitment to emotional and spiritual preparation is naïve at best and foolhardy at worst.

Financial Collapse

This is a time when “faith in ‘business as usual’ is lost. The future is no longer assumed to resemble the past in any way that allows risk to be assessed and financial assets to be guaranteed. Financial institutions become insolvent; savings are wiped out and access to capital is lost.” Essentially, says Orlov, the way in which the financial aspect of collapse has been dealt with is through “extend and pretend” which does not address the root of the problem, usury. Yet, as he does with all of the stages of collapse, Orlov presents options for cashing out and at the end of the section on financial collapse, offers a vignette of his own family weathering the collapse of the Soviet Union in the late 1980s as well as a case history related to the financial collapse of Iceland.

Certainly, whether it be in financial markets or the loss of one’s employment or the vanishing of one’s retirement pension, the undermining of trust is ubiquitous. Of this Orlov says:

A cultural flip is needed to change from impersonal, commercial relationships to personal relationships based on trust, and the first hurdle, for many people, is in understanding what trust actually is,because there is no innate human quality called trustworthiness, possessed by some people, lacking in others. Rather, it is more along the lines of a generalization concerning a given individual’s behavior over time, within a given relationship. Trust is transactional: a person needs a reason to trust you, and you need a reason to trust that person. There is, however, such a quality as trustfulness: this is the property of small children, tame animals and, most unfortunately for them, many regular, salt-of-the-earth, mainstream Americans. It is of negative survival value in the context of financial collapse.

Referring to the writing of Russian scientist and anarchist, Peter Kropotkin, Orlov emphasizes that humans are social creatures who “thrive through cooperation,” and it seems that the smaller the scale, the more likely that trust will actually function without major conflict.

Ultimately, in financial collapse, decisions must be made about the viability of larger players and who benefits by continually propping them up. According to Orlov, “Iceland’s approach was to let financial companies go bankrupt rather than prop them up with public funds….But a further case can be made that the failure of financial institutions can be a good thing, because it frees up resources for productive activities that benefit the entire society rather than just the rentier class and the über-rich.”

Commercial Collapse

Financial collapse leads to commercial collapse which then leads to political collapse, and the effect of each shock is to make the system as a whole less resilient. In this section Orlov distinguishes the three kinds of commerce that function in the current commercial milieu: trade, barter/tribute, and gift. As financial, commercial, and political collapse exacerbate, Orlov sees trade, the dominant function in industrial societies, being superseded by gift. Whereas “barter involves an external conflict between two conflicting sets of interests that is resolved through negotiation, gift internalizes this conflict in each person. Explicitly and publicly one never gives gifts expecting to get something back. But gift also presupposes a debt of gratitude that is discharged through reciprocity. Nevertheless, with gifts one’s social status is based on one’s generosity and is destroyed by any explicit expectation of reciprocation.”

Orlov’s perspective on gift echoes Charles Eisenstein’s “gift economy” as explained in his groundbreaking book, Sacred Economics. In a video published by The Guardian, Eisenstein argues that, “such a model aims to bring about a workforce driven by passion rather than coerced by money and profit, and he highlights certain co-operative schemes already proving the ideal can be made real.” Eisenstein’s work offers one model for how communities and individuals might respond to financial and commercial collapse and provides an opportunity to begin practicing this strategy in current time.

Most importantly in preparing for commercial collapse, according to Orlov, “you can work on reducing your dependence on impersonal relationships and institutions. You can learn to avoid relying on money and monetary equivalents, and instead learn to rely on gifts and the various extensions and generalizations of gifts. You can create new custom and ritual, laying the foundation for a new culture that is right side up.”

Political Collapse

Following on the heels of financial and commercial collapse is political collapse which is a different animal altogether, and leaves the society open to chaos.

Realistically, however, the police, the military, and the bureaucrats will not quietly go away and “allow the people to self-organize, experiment and come together as autonomous new groups adapted to the new environment in their composition and patterns of self-governance.” The greatest fear of the hierarchy, and of the general population who are terrified of anarchy, is the lack of order. And of course, eventually the nation state itself will vanish. According to Orlov:

In its stead will come a myriad of tiny polities, some squabbling with their neighbors, some living side by side peaceably, but all incapable of launching a single aircraft carrier, never mind starting a world war. But they might be able to build some beautiful cathedrals and opera houses, lavish resources on the arts and on schools of philosophy and use artisanal methods to produce everyday items that will put to shame the mass-produced plastic rubbish of today.

Much of this depends, however, on the issue of scale. The smaller the scale, the greater the likelihood of sustained success. As political collapse exacerbates, state services go away, and we have only to consider some dramatic examples in the United States such as Flint, Michigan, Camden, New Jersey, and Fall River, Massachusetts to see what wider-spread collapse will look like.

What is certain is that law and order will disappear. “Once central authority does collapse,” says Orlov, “an area may lapse into chaos and warlordism for a time, disrupting both licit and illicit trade. Eventually new forms of governance begin to emerge.” Certainly, we can then expect to see mini-mafias proliferate which will opportunistically provide some kind of societal structure and do so with a certain amount of appearance of honesty and fairness without which they could not succeed.

For Orlov, attempting to effect political change in a collapsing society is more than futile. Not only is political collapse unavoidable, but as resources further deplete, the methods of communication on which we have relied for so long will eventually vanish. He suggests that we could make better use of our time by learning some effective ways of communication that do not rely on the Internet. Of this he says: “And so, if you want to achieve a serious political effect, my suggestion is that you sit back Buddha-like, fold your arms, and do some deep breathing exercises. Then you should work on developing someinterpersonal skills that don’t need to be mediated by electronics.”

This contention also reinforces mine, namely that emotional preparation/inner work/communication skills are every bit as urgent as the logistical preparations we are making in terms of food, water, shelter, security, and health maintenance.

Social Collapse

For Orlov, in social collapse: “Faith that ‘your people will take care of you’ is lost, as local social institutions, be they charities or other groups that rush in to fill the power vacuum, run out of resources or fail through internal conflict.” For this reason, community organizing is futile because “the central problem with community organizing is that the sort of community that stands a chance post-collapse is simply unacceptable pre-collapse: it is illegal, it is uncomfortable and it is unsafe. No reasonable person would want any part of it.”

The old rules must be supplanted by new ones. There will be no time or resources for the rules by which society currently operates to be changed through lobbying, deliberation, legislation, and litigation. Again, one can anticipate obstacles from the vested interests:

By default, the procedure for those who wish to survive will be to universally disregard the old rules and to make up new rules as they go along, but this is bound to cause mayhem and much loss of life. The best-case scenario is that the old rules are consigned to oblivion quickly and decisively. The public at large will not be the major impediment to making the necessary changes. Rather, it will be the vested interests at every level — the political class, the financial elite, professional associations, property and business owners and, last but not least, the lawyers — who will try to block them at every turn. They will not release their grip on society voluntarily, so it is best to make plans to forestall and thwart their efforts….The old rules will not work, but the new ones might, depending on what they are. You might want to give the new rules some thought ahead of time, perhaps even test themout under the guise of emergency preparation training.

Here Orlov reminds us that as jobs and services go away, people will have much more time on their hands, and people will begin engaging with others who are in a similar situation so that the spontaneous regeneration of the community will automatically be engendered by the construction of new rules made by ordinary people who are no longer invested in the consumeristic system.

Some help can come from religious groups or communities and charitable organizations (many of which are religious). Historically, many of them have weathered extremely troubled times and have ensured the survival of their own and surrounding communities. In a disintegrating, corrupt, and unreformable political system, why fight battles that have already been won? Working with religious institutions or communities could prove extremely useful in making new rules and regenerating communities.

Like Orlov, I believe that collapse will not unfold in a monolithic, standardized manner. I am fond of saying that it will play out in a “lumpy” fashion with some regions looking very different from others. In some communities, people will come together and cooperate, and in other communities they will not.

Cultural Collapse

Orlov defines cultural collapse in this way: “Faith in the goodness of humanity is lost. People lose their capacity for ‘kindness, generosity, consideration, affection, honesty, hospitality, compassion, charity.’ Families disband and compete as individuals for scarce resources. The new motto becomes ‘May you die today so that I can die tomorrow’.”

He suggests that we must consciously widen our circle of trust by beginning to trust people outside it in small ways and then deepening that trust when they prove trustworthy. To accomplish this, we need to swim upstream against the culture’s prevailing attitude of not recognizing or not seeing others. Let other know that you see them, and begin trusting in small ways.

Additionally, we must also preserve the knowledge we deem worth preserving by speaking it orally to each other and to our children. This is especially important in a collapsing world where electronic information, libraries, and many forms of written information may disappear. The second-best means of preserving this knowledge is by writing it down and teaching it to children.

In societal collapse, the family will become increasingly important. Orlov argues that “the family can be viewed as a microcosm of society — or society as a meta-family. This line of reasoning leads to a radical conclusion: that family is society, while larger groups are illusory. At the rock bottom of human survival, there is no individual and there is no state; there is only the family, or, if there isn’t, there is something that’s not quite human — or there is nothing at all.”

Orlov ends the book with an invitation to his readers to allow their absorption of collapse information to give them a “secret post-collapse identity” that will profoundly alter how they live their lives. Eventually, the reader will meet others who have adapted their own post-collapse identities, and very rich conversations might ensue. But of course, that will be all about trust, and trust, as Orlov reminds us, is built on actions, not words. Moreover, he cautions the reader not even to trust him “just because,” but rather he asserts, “you should think for yourself, act on your thoughts and, if that works for you, learn to trust yourself. All I want to do is give you a gentle nudge in that direction.”

Most importantly, Dmitry Orlov leaves us with perhaps the most profound and pivotal sentence of the book: “Collapse is not a nightmare scenario to be avoided at all costs but part of the normal, unalterable ebb and flow of human history, and the widespread tendency to block it out of our worldview is, to put it very mildly, maladaptive.” The Five Stages of Collapse, I believe, is required reading for long-term, strategic collapse preparation.

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http://news.goldseek.com/GoldenJackass/1364601600.php

USDollar: Ring-Fenced & Checkmate

An unstoppable sequence of events has been put into motion finally. The pressure has been building for months. Some themes are plainly evident, except to those who wear rose colored glasses in the US Dome of Perception. The USTreasury Bond will be brought home to the US and British banks, where it will choke its bankers, then be devalued for survival reasons, after a painful isolation. The Chinese and Russians will conspire to finance the Eurasian Trade Zone corridor foundation with USTBonds, held in reserve, put to usage. The British will play a very unusual role, selling out the United States in order to be squires to the Eastern Duo. The process has begun; it cannot be stopped. The events are already being grossly misinterpreted and minimized in the US press, where devoted lapdogs, artistic swindlers, and creative writers prevail. The Paradigm Shift eastward is showing its next face, with a truly massive trade zone for cooperation and reduced cost overhead as the giant foundation. The Untied States for all of its past hegemony and devious manipulations and vicious attacks, will be excluded. The British will assist in the exclusion in order to avoid the Third World themselves. The following blueprint is the result of years of planning, with steady information and hints and confirmations by at least two Hat Trick Letter sources. The sunset of the USDollar has a blueprint. As a personal embroidery, let me state that this article is the most important the Jackass has ever written. Let it be taken seriously for its grave somber message.

EURASIAN TRADE ZONE

The crowning blow is the financial centerpiece to the trade zone, which draws upon the critical mass bulk of the BRICS nations as nucleus. Together Brazil, Russia, India, China, and South Africa have begun to form an alliance built upon trade and economic development, forged by investment in infrastructure and its construction. Include Iran and Indonesia to welcome the new BRIIICS nations for a larger Eastern representation. The arterial system of the trade zone will be energy supply, the life blood of commerce. The Eurasian Trade Zone is being formed, with an energy foundation. Important bilateral pacts were made concrete in the last week. Supply of crude oil, natural gas, including LNG, will come from a vast system of pipelines from Russia to Central Europe and from Russia to China. Completed pipelines will flow. Other pipelines will be completed. Crucial pacts have been made final, with more to come. Additional important pipelines along the periphery will be completed also, like the Iran-Pakistan Pipeline, despite the USGovt obstruction and intimidation. New LNG ports will be constructed. Logistics for rail traffic will be agreed upon, for commodity supply. Many features of the trade zone will be worked out, like reduced tariffs, like border inspection methods, like payment systems including barter, like environmental concerns, like regional cooperation.

BRICS DEVELOPMENT BANK

Consider the BRICS Development Bank. It is so much more than a fund to build railroads in remote African locations, as the delusional US press reports. It will form the giant credit line for countless projects upon which trade will be conducted, often called infrastructure, but so much more. It will gradually reveal itself to provide a second function, a core bank for trade payments outside the USDollar sphere. Steps are being made, extremely important steps, that will shape the next chapter. The United States will not play a role. With a trade zone and financial payment structure, the USDollar is to be rendered an outsider looking in, soon to be deemed obsolete. The many emerging nations are coming of age, flexing their muscles, banding together. Their critical mass in trade volume, in industrial output, and in product development, including patent registration, are impressive. In the last two years, they have demonstrated that the G-20 Meeting of finance ministers has totally eclipsed the G-7 Meeting that had dominated for two decades. They are making the next critical step in creating a bank, a global bank whose role will grow and expand. It will operate under the golden glow.

EXCLUSION OF UNITED STATES

The many years of abusive control of the FOREX currency markets, intervention in the sovereign bond markets, manipulation in the important commodity markets, devious propaganda in the communications networks, with support role played by the aggressive USMilitary and nefarious activity by its security agencies have guaranteed exclusion of the United States. The unspeakable abuse of the US$ credit card will end, as the global reserve currency is dismissed from its throne. The US leader crew, led by fascist bankers, can print money and counterfeit bonds all they wish, but the currency will be required to submit to grand devaluation if they wish to purchase supplies for the massively lopsided and imbalanced USEconomy, the greatest travesty in marketplace history. While the Keystone Pipeline is corrupted by the USGovt with hidden beneficiaries such as Halliburton and Burlington Northern, essentially divvying up the gangrenous paunch of the exhausted bloated American torso, the vast pipelines of the European and Asian continents are merging. They will not include the Americans, whose pathetic gambit fell on its face, the Trans-Pacific Partnership pushed by the Obama Admin. It actually attempted to form a trade zone with Asia, on condition that the lead nations Japan and South Korea excluded China. How incredibly moronic and amateurish! What a pathetic return on the dime for votes for this leader in the new police state.

BRITISH BROKER ROLE & INTRIGUE

The British have an historical knack to remain on top of the bank center heap. Earlier this year, when they announced the launch of a Chinese Yuan Swap Facility in London City, they stepped on the New York neck. Never in a million years would South Manhattan serve as the site of a Yuan Swap functionary post, not during a trade war that has a secret hot military war element being played out in Southern African near the horn (see Djibouti). The embattled British Petroleum will retain a 19.75% stake in Rosneft, which is to acquire the significant BP-TBK energy firm in Russia. Both Bank of America and Citigroup are brokering a $55 billion deal that will enable Rosneft to become the world's largest oil company. Several hidden messages are laden within the blockbuster global changing deal by Rosneft. By dissecting the flow, it is clear the BP executive staff is selling out, since not paying dividends. The collateral for the deal toward the loans will come from USTreasury Bonds. The Anglo-American bank complex will in effect be forced to swallow its own high volume of toxic paper. The tainted BP oil giant still reels from the tarnish of the Gulf of Mexico incident. Worse, BP is finally pushed out following its dubious role in the Yeltsin years of Russia. That difficult transition period in the 1990 decade saw a failed attempt by the Western Oil Giants to control Russia and its vast energy wealth. Putin from the KGB said no, and it did not happen on his watch. He assumed the Kremlin top post. Witness a potentially crucial London role in helping the Eurasian Trade Zone, perhaps buying favor to avoid the Third World. The broad exclusion of the United States guarantees a Third World flavor and stench for the North American core, with a Mad Max overtone and a Dachau closet.

DEVIOUS CYPRUS HIDDEN ANGLE

A piece of the financing for the Rosneft deal came from GazpromBank, which operates out of Cyprus. China has posted $30 billion in USTBonds as collateral within the massive deal, in return for ample future crude oil supply. Since Russia will receive a steady flow of payments from China from diverse energy pipeline supply, in the form of USTBond fund flow, the big debt to the London banks will be paid off by USTBonds. The payoff will be in the same terms of the huge collateral. Conclude that the Eurasian Trade Zone will have an energy pipeline and delivery system with loaded supply whose foundation is built upon USTBonds, sent back to the Anglo-American bankers to digest. The USTBonds are going home to die. As Lenin said, the rope to hang themselves will be bought by the capitalists. As footnote, some important toes were stepped on in Cyprus. Expect more entries to the morgue. The event opened the door to dangerous games of brinksmanship.

The timing of the Cyprus bank account tax and confiscation is curious, exactly when the extremely significant summit meeting took place between Russian President Putin and Chinese President Xi Jinping, where several big pacts were signed. One is left to wonder if the Cyprus fire was lit by the Europeans in order to attempt to disrupt the Moscow Energy Summit with heavy smoke. It bears repeating. The summit received almost zero Western press coverage, even though its details outline a sunset of the USDollar. Maybe because its details outline a sunset of the USDollar. The Jackass is left to wonder if the next important energy pact with the Eurasian Leader Duo (Russia & China) will involve Saudi Arabia, with a whiff of sunset for the Petro-Dollar defacto standard. Cyprus might indeed have been all about trying to save the Petro-Dollar, more than the European banks. Perhaps the Moscow Summit dictated the Cyprus timetable. The Italian elections to depose Monti, Spanish high level corruption and bankruptcies, and the French backtrack on massive spending cuts, these three nations point to urgency in disaster control. The bank account tax was thrust forward, unmasking the fascist bankers.

USDOLLAR HEGEMONY ENDING

The alternative system to conducting trade outside the USDollar system has had formative stages since the Lehman Brothers and Fannie Mae collapse. The Eastern trade leaders have been very busy quietly constructing a new system, with almost zero press coverage. They prefer to work in the background. Recent events indicate they have chosen the formal public stages and forums with wider visibility, starting with the February G-20 Meeting in Moscow. The true agenda for G-20 finance ministers was to hatch finally the USDollar alternative. The sleepy West appears not to be paying much attention. The initiatives to construct alternative platforms were given a major thrust in the last year since the Iran sanctions led by the USGovt banker and their henchmen in London. For the last 20 years at least, trade has followed banking. Nations of the world have been coerced for three decades into holding USGovt debt securities in order to make payment in trade, most notably in crude oil. With the Grand Arab Recycling accord struck by the 1970 decade leaders, the Petro-Dollar was born in return for a fantastic higher oil price. The oil-rich Arab royalty supported the USDollar by recycling trade surplus into USTreasury Bonds. The conventional practice dictated that global banking systems be dominated by USTBonds in reserves, serving as the banking foundation of debt.

New chapter to turn. The ongoing endless QE to Infinity has hastened Eastern trade leaders. The near 0% return from USTBond yields has motivated them to seek alternatives. They are horrified by the debasement of their hard-earned reserves, filled to the gills with USTBonds of shrinking value and low yield. The new trade settlement system based in Gold finance will turn the tables, as once more trade is to dictate banking. The combination of central bank hyper monetary inflation, big US bank fraud, security agency $100 bill counterfeit, and rampant criminality in the US financial system has motivated the Eastern nations to act. They have acted. The clear outcome is that the Western banking system will topple, since the East will be shoving the USTBonds back to Anglo-American shores for cemetery treatment. Trade should always dictate banking. The major trade partners no longer want US$-based trade settlement. Watch for the crowning blow in the Saudi response soon, since they always follow the winners.

THE CENTERPIECE PLAN

The new BRICS development bank will surely be supplied with USTreasury Bonds at first. The primary seeding is obvious. The emerging nations have collected huge reserves from successful trade over the last decade, primarily held in USTBonds. They do not wish to hold them, since undermined and debased by their own steward at the US Federal Reserve. The big Eastern nations have committed $100 billion for the fund, whose liquidity lies in USTBonds. On a gradual ramp, the USTBonds will be converted to Gold bars for the core bank asset in the development fund. Some of the 6000 metric tons of Gold bullion removed from London banks by the Eastern entities from March to July 2012 might find their way into the BRICS Fund core. The initial role of funding critical important projects like pipelines, communication networks, railroads, shipping ports, ships & trucks, perhaps even energy transfer ports, will become clear. The more overarching role of forming a (Eastern) global core central bank clearing house for payment transactions will be its second dual role. The emerging nations have had their fill of the USDollar control mechanisms with the SWIFT bank structure, the Intl Monetary Fund steering committee, and others. Finally, Gold Trade Notes would be used in trade settlement. Witness the new Eastern Fed for trade settlement in Gold bullion. Better to call it the BRICS Development Fund, since a major Trojan Horse for excreting USTBonds through its rectum, the London Boyz busily catching it.

The Gold core will facilitate the purchase of Gold Trade Notes much like the common letters of credit used widely in commerce nowadays. Like the Eurasian Russian-Chinese energy foundation, the development fund will be built on the back of USTBonds in toxic discharge. In the process, expect extreme hardball, shoving the toxic USTBonds back into US and British banks, as collateral for huge loans, as funds for repayment of huge loans, as funds to purchase Gold. In the process, the COMEX with LBMA appendage will be drained of its Gold, a future default assured. The Western gold marts will be unmasked as corrupt dens of empty inventory shelves. What comes is a BRICS Development Fund which will serve as a quasi global gold central bank for the expressed purpose of facilitating trade settlement in Gold. This is hardly just a fund to finance African rail projects.

THE CHECKMATE

A checkmate is in progress. It has four important elements.

1) The established Eurasian Trade Zone joins the massive Asian continent with a significant portion of the European continent, where three quarters of the world population resides. The trade zone has no visible presence or participation by either the United States or United Kingdom.

2) The BRICS Development Fund will control a giant sum of $100 billion. It will eclipse the role of the Intl Monetary Fund. The fund will facilitate numerous infrastructure projects. However, its other feature will be the shocker, as its core is transformed into Gold bullion. The conversion of USTBonds to Gold will nail the coffin in the isolated USDollar, a topic of Jackass scribbles for the last full year.

3) The flow of USTBonds will be from China to London, for financing the foundation of the Eurasian Trade Zone on its energy backbone with brisk energy flow. The collateral for large loans is to be USTBonds, as is repayment for loans to be USTBonds.

4) The transition from Yuan-based trade settlement via the numerous Swap Facilities in barter trade with key nations, toward Gold trade settlement via the BRICS fund that will feature a gold core, will launch the new Gold Trade Standard. It will not be a banker dominated currency type of Gold Standard. It will instead be a trade settlement Gold Standard that bypasses the hegemony of the Anglo-American banking system, the SWIFT rules, the FOREX gaming, and the IMF/World Bank harlots that harbor insects.

ZINGERS AS COFFIN NAILS

Many are the big signals and signposts with deep meaning. They line the path to the Third World. They are many, diverse, and unmistakable in importance. The gradual discard of the USDollar as global reserve currency, the gradual discard of the USTreasury Bond as primary banking system reserve asset, these events are in progress with a speed not seen in past months or past years, not since 2008. The level of intrigue matches the level of deception. Cyprus is not a one-off event, an isolated insignificant beer fart. It is a flash point event. The tipping point events could be bank runs across Southern Europe extending to Britain and the United States, including Canada. Numerous potential tipping point events can be identified, each powerful and ominous for the US Fascists in power. The USDollar is coming home to be buried and devalued. The USTBond is coming home to be buried and downgraded. The ring fence has been clearly laid out. The checkmate with the Eurasian Trade Zone and BRICS Fund is evident for the trained analyst eye. The devaluation will cause severe price inflation and supply shortages for the USEconomy. The end game has never been more clear. Follow the numerous highly important factors at work, each of which could produce a tipping point event. The dominos are aligned and ready. Inside the US Dome of Perception, they are less visible, yet still at work for extreme consequences. Some severe disorder comes this way. Expect some quantum leaps upward in the Gold price and Silver price, each controlled by unprecedented criminal activity in the financial markets.

The BRICS Development Fund is the main event, to build a railway to a dark place for the United States, ring fenced for its toxic USDollar. Gone will be the corrupted motivated tools like the IMF and World Bank, with even Western central banks of lesser importance. The BRICS Fund could be the Trojan Horse (much like ObamaCare) that permits a vast conduit to be built, a seemingly innocuous let permitted entrance through the door, which permits USTBonds to be dumped like the trash.

The upcoming Gold purchases by the BRICS Fund might be coordinated with the Shanghai Metals Exchange, to exploit the artificial low London Gold price. A COMEX bust can be foreseen.

The BRICS should be careful about the new undersea global communication cable system. In 2007, foul play resulted in the Iranian cable being cut, the result of cooperative action by the USGovt and the little ally on the Southern Med that looks northwest to Italy.

The tipping nation is Germany, which has had its fill supporting the slower wasteful debt-ridden Southern European nations. After cutting the cord, they will embrace the Eurasian Trade Zone. Evidence is the numerous heavy rail facilities that begin in Russia and end in Germany for commodity supply. There are two Germanys, one with old corrupt ties to the West, another with traditional reliable ties to the East. The Western camp is given light by the press, while the Eastern camp works behind closed doors shaping the next chapter.

The Eastern Alliance (often discussed in past Hat Trick Letters) is slowly coming into view. The Russian and Chinese corridor will serve as the commercial foundation. The BRICS Development Fund will serve as the backbone. When Germany joins in more overt manner, the Alliance will be clear on the geopolitical stage. Then comes the Saudis to join, complete with protectorate role already offered by the Eastern Duo giants, who together will announce the end to the Petro-Dollar defacto standard.

The political rebellion movement inside Germany is slowly coming into view. They wish to return to the D-Mark currency and to discard the Euro, an experiment in disaster, waste, fraud, and ruin. The movement is gaining traction. Discussion of the Nordic Euro (aka Teutonic Euro) has been heard on an increasing basis among its tribal cousins. Germany will side with Russia & China, and join the next chapter, after shedding its PIIGS pen trash.

Both Russia and China purchase all their domestic gold mining output. If truth be told, their gold reserves are multiples higher than the official data indicates. Neither nation has any desire to cooperate with such critical disclosure, much like national trade secrets. Both nations are ready for the next chapter, with a few years of preparation in new modern systems, platforms, wiring, and gold held in reserve as core wealth.

The ABN Amro news of halted gold delivery speaks volumes to the absent inventory linked to the corrupted London gold market. They have no Gold in inventory. They control the Gold price with paper leverage and suppressive techniques. This news halt out of the Netherlands should be viewed in context of the Germans, Dutch, and Austrians demanding their gold in repatriation. London has none. What gold bullion they do obtain comes from urgent shipments from the Roman Catacombs and the Basel hills of Switzerland.

The nations across the entire West have citizens deeply worried about their savings wealth stored in the banks. They are beginning to realize their accounts are legally considered as bank liabilities subject to heavy loss upon bank failures. They will begin to remove the money from bank accounts in droves, but with capital controls imposed.

The Cyprus bank account tax is the latest ignored shock wave warning to the West. It is described as a small tax to assure bank solvency, but it is a vicious transfer from sovereign source to depositor private source in funded bailouts. It is confiscation. The 2005 Bankruptcy Law in the US gave away the plan, with savings deposits subordinated under derivatives. The MF-Global episode has not resulted in much learned. It was the first test ride of the subordination rules in the new law. The Jackass warned in early 2012 of an MF-Global event for bank accounts and stock accounts. The event is coming very soon, but the public is very sleepy distracted and dulled.

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http://www.truthdig.com/report/category/hedges/

The Hijacking of Human Rights

The appointment of Suzanne Nossel, a former State Department official and longtime government apparatchik, as executive director of PEN American Center is part of a campaign to turn U.S. human rights organizations into propagandists for pre-emptive war and apologists for empire. Nossel’s appointment led me to resign from PEN as well as withdraw from speaking at the PEN World Voices Festival in May. But Nossel is only symptomatic of the widespread hijacking of human rights organizations to demonize those—especially Muslims—branded by the state as the enemy, in order to cloak pre-emptive war and empire with a fictional virtue and to effectively divert attention from our own mounting human rights abuses, including torture, warrantless wiretapping and monitoring, the denial of due process and extrajudicial assassinations.

Nossel, who was deputy assistant secretary of state for international organization affairs under Hillary Clinton in a State Department that was little more than a subsidiary of the Pentagon, is part of the new wave of “humanitarian interventionists,” such as Samantha Power, Michael Ignatieff and Susan Rice, who naively see in the U.S. military a vehicle to create a better world. They know little of the reality of war or the actual inner workings of empire. They harbor a childish belief in the innate goodness and ultimate beneficence of American power. The deaths of hundreds of thousands of innocents, the horrendous suffering and violent terror inflicted in the name of their utopian goals in Iraq and Afghanistan, barely register on their moral calculus. This makes them at once oblivious and dangerous. “Innocence is a kind of insanity,” Graham Greene wrote in his novel “The Quiet American,” and those who destroy to build are “impregnably armored by … good intentions and … ignorance.”

There are no good wars. There are no just wars. As Erasmus wrote, “there is nothing more wicked, more disastrous, more widely destructive, more deeply tenacious, more loathsome” than war. “Whoever heard of a hundred thousand animals rushing together to butcher each other, as men do everywhere?” Erasmus asked. But war, he knew, was very useful to the power elite. War permitted the powerful, in the name of national security and by fostering a culture of fear, to effortlessly strip the citizen of his or her rights. A declaration of war ensures that “all the affairs of the State are at the mercy of the appetites of a few,” Erasmus wrote.

There are cases, and Bosnia in the 1990s was one, when force should be employed to halt an active campaign of genocide. This is the lesson of the Holocaust: When you have the capacity to stop genocide and you do not, you are culpable. For this reason, we are culpable in the genocides in Cambodia and Rwanda. But the “humanitarian interventionists” have twisted this moral imperative to intercede against genocide to justify the calls for pre-emptive war and imperial expansion. Saddam Hussein did carry out campaigns of genocide against the Kurds and the Shiites, but the dirty fact is that while these campaigns were under way we provided support to Baghdad or looked the other way. It was only when Washington wanted war, and the bodies of tens of thousands of Kurds and Shiites had long decomposed in mass graves, that we suddenly began to speak in the exalted language of human rights.

These “humanitarian interventionists” studiously ignore our own acts of genocide, first unleashed against Native Americans and then exported to the Philippines and, later, nations such as Vietnam. They do not acknowledge, even in light of the atomic bombings of Hiroshima and Nagasaki, our own capacity for evil. They do not discuss in their books and articles the genocides we backed in Guatemala and East Timor or the crime of pre-emptive war. They minimize the horror and suffering we have delivered to Iraqis and Afghans and exaggerate or fabricate the benefits. The long string of atrocities carried out in our name mocks the idea of the United States as a force for good with a right to impose its values on others. The ugly truth shatters their deification of U.S. power.

Nossel, in the contentious year she headed Amnesty International USA before leaving in January, oversaw a public campaign by the organization to support NATO’s war in Afghanistan. She was running Amnesty International USA when the organization posted billboards at bus stops that read, “Human Rights for Women and Girls in Afghanistan—NATO: Keep the Progress Going.” Madeleine Albright, along with senior State Department officials and politicians, were invited to speak at Amnesty International’s women’s forum during Nossel’s tenure. Nossel has urged Democrats to stay the course in Iraq, warning that a failure in Iraq could unleash “a kind of post-Vietnam, post-Mogadishu hangover” that would lamentably “herald an era of deep reservations among the U.S. public regarding the use of force.” She worked as a State Department official to discredit the Goldstone Report, which charged Israel with war crimes against the Palestinians. As a representative on the U.N. Human Rights Council she said that “the top of our list is our defense of Israel, and Israel’s right to fair treatment at the Human Rights Council.” Not a word about the Palestinians. She has advocated for expanded armed intervention in countries such as Syria and Libya. She has called for a military strike against Iran if it does not halt its nuclear enrichment program. In an article in The Washington Quarterly titled “Battle Hymn of the Democrats,” she wrote: “Democrats must be seen to be every bit as tough-minded as their opponents. Democratic reinvention as a ‘peace party’ is a political dead end.” “In a milieu of war or near-war, the public will look for leadership that is bold and strident—more forceful, resolute, and pugnacious than would otherwise be tolerated,” she went on. In a 2004 Foreign Affairs article, “Smart Power: Reclaiming Liberal Internationalism,” she wrote: “We need to deploy our power in ways that make us stronger, not weaker,” not a stunning thought but one that should be an anathema to human rights campaigners. She added, “U.S. interests are furthered by enlisting others on behalf of U.S. goals,” which, of course, is what she promptly did at Amnesty International. Her “smart power” theory calls on the U.S. to exert its will around the globe by employing a variety of means and tactics, using the United Nations and human rights groups, for example, to promote the nation’s agenda as well as the more naked and raw coercion of military force. This is not a new or original idea, but when held up to George W. Bush’s idiocy I guess it looked thoughtful. The plight of our own dissidents—including Bradley Manning—is of no concern to Nossel and apparently of no concern now to PEN.

Coleen Rowley and Ann Wright first brought Nossel’s past and hawkish ideology to light when she became the executive director of Amnesty International USA a year ago. Rowley and Wright have written correctly that “humanitarian interventionists,” in or out of government, see no distinction between human rights work and the furtherance of U.S. imperial power. Nossel, they noted, “sees no conflict between her current role and having been a member of the executive staff whilst her President and Secretary of State bosses were carrying out war crimes such as drone attacks in Pakistan and Afghanistan and shielding torturers and their enablers in the Bush administration from prosecution.” (For more on this see Rowley’s article “Selling War as ‘Smart Power.’ ”)

Is this the résumé of a human rights advocate in the United States? Are human rights organizations supposed to further the agenda of the state rather than defend its victims? Are the ideas of “humanitarian interventionists” compatible with human rights? Are writers and artists no longer concerned with the plight of all dissidents, freedom of expression and the excesses of state power? Are we nothing more than puppets of the elite? Aren’t we supposed to be in perpetual, voluntary alienation from all forms of power? Isn’t power, from a human rights perspective, the problem?

The current business of human rights means human rights for some and not for others. Human Rights Watch, Amnesty International, Physicians for Human Rights, the Peace Alliance, and Citizens for Global Solutions are all guilty of buying into the false creed that U.S. military force can be deployed to promote human rights. None of these groups stood up to oppose the invasion of Iraq or Afghanistan, as if pre-emptive war is not one of the grossest violations of human rights.

The creed of “humanitarian intervention” means, for many, shedding tears over the “right” victims. Its supporters lobby for the victims in Darfur and ignore the victims in Iraq, Afghanistan, Pakistan, Yemen and Gaza. They denounce the savagery of the Taliban but ignore the savagery we employ in our offshore penal colonies or our drone-infested war zones. They decry the enslavement of girls in brothels in India or Thailand but not the slavery of workers in our produce fields or our prisons. They demand justice for persecuted dissidents in the Arab world but say nothing about Bradley Manning.

The playwright and fierce anti-war critic Arthur Miller, the first American president of PEN International, fearlessly stood up to McCarthyism and was blacklisted. He denounced the Vietnam War. He decried the invasion of Iraq. PEN, when it embodied Miller’s resistance and decency, stood for something real and important. As the U.S. bombed Iraq into submission and then invaded, Miller, who called the war a form of “mass murder,” said indignantly: “It’s a joke that the U.S. government wheels out the Geneva Convention when they themselves have turned away or flouted so many international treaties.”

The posing of government shills such as Nossel as human rights campaigners and the marginalization of voices such as Miller’s are part of the sickness of our age. If PEN recaptures the moral thunder of the late Arthur Miller, if it remembers that human rights mean defending all who are vulnerable, persecuted and unjustly despised, I will be happy to rejoin.

All systems of power are the problem. And it is the role of the artist, the writer and the intellectual to defy every center of power on behalf of those whom power would silence and crush. This means, in biblical terms, embracing the stranger. It means being a constant opponent rather than an ally of government. It means being the perpetual outcast. Those who truly fight for human rights understand this.

“Whether the mask is labeled Fascism, Democracy, or Dictatorship of the Proletariat, our great adversary remains the Apparatus—the bureaucracy, the police, the military … ,” Simone Weil wrote. “No matter what the circumstances, the worst betrayal will always be to subordinate ourselves to this Apparatus, and to trample underfoot, in its service, all human values in ourselves and in others.”

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http://kunstler.com/blog/2013/04/are-you-going-to-entropy-faire.html

Are You Going To Entropy Faire?

Things are breaking loose. Holes have appeared in the fabric of fraud and lies that passes for the world money system. They are black holes, gravitationally sucking in the things breaking loose, and as these things cross their event horizons, they will never be seen again. These things I speak of are the collateral for vast nebulae of falsely generated debts and obligations that were never intended to be honored (i.e. regarded as real). As they vanish down the wormholes of time, they take with them their pretenses of money value, meaning they leave reverberations of impoverishment in the shadowy place that the real world has become.

The process described above - an alchemy of physics - will begin to shed light where the shadows have been, revealing a much harsher world in sharp contours and shocking color, for instance: red, the color of ink representing losses on real balance sheets of every household, every enterprise, and every government the whole world round. A scramble for safety now ensues, not just to lay hold of anything with remaining real "moneyness," but for the resources that drive the kind of economies we have. In other words, for gold and silver, and for oil and gas.

Of course, great geopolitical forces spin in the background. Only idiots subscribe to the paranoid fantasies of "one world government" and "global currencies." In the scramble underway, the things falling apart include units of governance, breaking into smaller pieces: empires, nation states. These will include the unraveling European Union but also the matrix of agreements and protocols that binds together the West - everything from the IMF to the G-7 to the World Bank - into an entropy express. One rather extreme scenario I do subscribe to was laid out by blogger Jim Willie recently: the effort by Russia, China, and others to isolate and neutralize the US dollar as the world's so-called reserve currency by systematically converting holdings of US Treasury bills into gold wherever possible, and to thereby diminish the baleful influence of the Imperial US behemoth. They are assisted in this endeavor by the US itself in its bungling efforts to manipulate and suppress gold prices, as well as our prevarications as to exactly how much gold remains in the various places it is supposed to be stashed - Fort Knox, West Point, and the sub-basement labyrinth of the Federal Reserve Bank of New York - generating ever-greater uncertainty about the extant world gold supply, and hence its value relative to things like currencies. Nobody here can even ask the right questions.

While The New York Times focuses on the momentous issue of real estate sales in the Hamptons, Russia and China will build gold-backed currencies aimed at monopolizing the trade in mineral and energy resources, leaving America and much of Europe to freeze in the dark and sit on gasoline lines at the empty filling stations. For a while that will work to the East's advantage - until it becomes clear that the entropic contraction of industrial economies is for everyone as we veer into a literal world made by hand. That's right, sooner or later Russia and China will get theirs, too. But in the meantime they have the ability to make the story a lot more interesting.

There's plenty of suspense this Easter weekend as observers nervously await the breaking action, to find out how much the oft-cited fear of confiscation has penetrated the regional money centers around Europe. Slovenia, a fairy-tale republic somewhere between Austria and the Duchy of Grand Fenwick, has been nominated by observers as the place most likely to be whacked by EU treasure confiscators. It owes about 10 billion Euros to the EU entropy cloud, with exactly zero chances of meeting its obligations. But then, it's in the nature of such non-linear event sequences that the shadows of the black swan's wings will pass over Slovenia and alight on a chimney-top in some utterly surprising place, say, Latvia or perhaps even Italy. In any case, European money will be on fire and a lot of that smokin' moolah surely will wend its way into the US equity markets under the illusion of safety. It's all just an accident waiting to happen. Money is not what it used to be and not what it seems.

There must be an inverse relationship between the juiced S & P index and the IQs of the public figures in America who pretend to be able to think, so that there are now just six remaining people in the political arena who can articulate the various parts of the mega-swindle that besets us: Bill Black, Jim Rickards, Bill Moyers, Elizabeth Warren, Bernie Sanders, and David Stockman. Stockman is out with a new book, The Great Deformation, that manages to concentrate all the requisite outrage in one gale of rectified objurgation. It is a pleasure to read Stockman - former budget director under Reagan and Michigan congressman - call out the villains from Reagan to Bernanke to Paulson to Rubin and scores of others in the most opprobrious terms. Stockman characterizes the financial action of recent decades a "leveraged buyout of the USA" and it sure looks that way. If you travel around the towns of the upper Hudson Valley - once an industrial corridor full of Jimmy Stewart type burgs - it's beginning to look like the country Borat grew up in. Everything of value that wasn't nailed down was taken, and everything that remains is broken, including the ragged population.

On Sunday night, wire stories had Cyprus close to "going Icelandic," that is, hoisting the middle finger to Brussels and repudiating the money owed. That option may end up seeming more attractive to virtually everybody in the broke world, including even the young college loan debt donkeys of the USA, groaning under their loads as they stand idle in the barren fields of unemployment. Imagine, all those people thinking that nirvana is a place of cold and darkness... with the vague odor of rotting fish hanging in the still air.

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http://www.truthdig.com/report/item/the_treason_of_the_intellectuals_20130331/

The Treason of the Intellectuals

The rewriting of history by the power elite was painfully evident as the nation marked the 10th anniversary of the start of the Iraq War. Some claimed they had opposed the war when they had not. Others among “Bush’s useful idiots” argued that they had merely acted in good faith on the information available; if they had known then what they know now, they assured us, they would have acted differently. This, of course, is false. The war boosters, especially the “liberal hawks”—who included Hillary Clinton, Chuck Schumer, Al Franken and John Kerry, along with academics, writers and journalists such as Bill Keller, Michael Ignatieff, Nicholas Kristof, David Remnick, Fareed Zakaria, Michael Walzer, Paul Berman, Thomas Friedman, George Packer, Anne-Marie Slaughter, Kanan Makiya and the late Christopher Hitchens—did what they always have done: engage in acts of self-preservation. To oppose the war would have been a career killer. And they knew it.

These apologists, however, acted not only as cheerleaders for war; in most cases they ridiculed and attempted to discredit anyone who questioned the call to invade Iraq. Kristof, in The New York Times, attacked the filmmaker Michael Moore as a conspiracy theorist and wrote that anti-war voices were only polarizing what he termed “the political cesspool.” Hitchens said that those who opposed the attack on Iraq “do not think that Saddam Hussein is a bad guy at all.” He called the typical anti-war protester a “blithering ex-flower child or ranting neo-Stalinist.” The halfhearted mea culpas by many of these courtiers a decade later always fail to mention the most pernicious and fundamental role they played in the buildup to the war—shutting down public debate. Those of us who spoke out against the war, faced with the onslaught of right-wing “patriots” and their liberal apologists, became pariahs. In my case it did not matter that I was an Arabic speaker. It did not matter that I had spent seven years in the Middle East, including months in Iraq, as a foreign correspondent. It did not matter that I knew the instrument of war. The critique that I and other opponents of war delivered, no matter how well grounded in fact and experience, turned us into objects of scorn by a liberal elite that cravenly wanted to demonstrate its own “patriotism” and “realism” about national security. The liberal class fueled a rabid, irrational hatred of all war critics. Many of us received death threats and lost our jobs, for me one at The New York Times. These liberal warmongers, 10 years later, remain both clueless about their moral bankruptcy and cloyingly sanctimonious. They have the blood of hundreds of thousands of innocents on their hands.

The power elite, especially the liberal elite, has always been willing to sacrifice integrity and truth for power, personal advancement, foundation grants, awards, tenured professorships, columns, book contracts, television appearances, generous lecture fees and social status. They know what they need to say. They know which ideology they have to serve. They know what lies must be told—the biggest being that they take moral stances on issues that aren’t safe and anodyne. They have been at this game a long time. And they will, should their careers require it, happily sell us out again.

Leslie Gelb, in the magazine Foreign Affairs, spelled it out after the invasion of Iraq.

“My initial support for the war was symptomatic of unfortunate tendencies within the foreign policy community, namely the disposition and incentives to support wars to retain political and professional credibility,” he wrote. “We ‘experts’ have a lot to fix about ourselves, even as we ‘perfect’ the media. We must redouble our commitment to independent thought, and embrace, rather than cast aside, opinions and facts that blow the common—often wrong—wisdom apart. Our democracy requires nothing less.”

The moral cowardice of the power elite is especially evident when it comes to the plight of the Palestinians. The liberal class, in fact, is used to marginalize and discredit those, such as Noam Chomsky and Norman Finkelstein, who have the honesty, integrity and courage to denounce Israeli war crimes. And the liberal class is compensated for its dirty role in squelching debate.

“Nothing in my view is more reprehensible than those habits of mind in the intellectual that induce avoidance, that characteristic turning away from a difficult and principled position, which you know to be the right one, but which you decide not to take,” wrote the late Edward Said. “You do not want to appear too political; you are afraid of seeming controversial; you want to keep a reputation for being balanced, objective, moderate; your hope is to be asked back, to consult, to be on a board or prestigious committee, and so to remain within the responsible mainstream; someday you hope to get an honorary degree, a big prize, perhaps even an ambassadorship.”

“For an intellectual these habits of mind are corrupting par excellence,” Said went on. “If anything can denature, neutralize, and finally kill a passionate intellectual life it is the internalization of such habits. Personally I have encountered them in one of the toughest of all contemporary issues, Palestine, where fear of speaking out about one of the greatest injustices in modern history has hobbled, blinkered, muzzled many who know the truth and are in a position to serve it. For despite the abuse and vilification that any outspoken supporter of Palestinian rights and self-determination earns for him or herself, the truth deserves to be spoken, represented by an unafraid and compassionate intellectual.”

Julien Benda argued in his 1927 book “The Treason of Intellectuals”—“La Trahison des Clercs”—that it is only when we are not in pursuit of practical aims or material advantages that we can serve as a conscience and a corrective. Those who transfer their allegiance to the practical aims of power and material advantage emasculate themselves intellectually and morally. Benda wrote that intellectuals were once supposed to be indifferent to popular passions. They “set an example of attachment to the purely disinterested activity of the mind and created a belief in the supreme value of this form of existence.” They looked “as moralists upon the conflict of human egotisms.” They “preached, in the name of humanity or justice, the adoption of an abstract principle superior to and directly opposed to these passions.” These intellectuals were not, Benda conceded, very often able to prevent the powerful from “filling all history with the noise of their hatred and their slaughters.” But they did, at least, “prevent the laymen from setting up their actions as a religion, they did prevent them from thinking themselves great men as they carried out these activities.” In short, Benda asserted, “humanity did evil for two thousand years, but honored good. This contradiction was an honor to the human species, and formed the rift whereby civilization slipped into the world.” But once the intellectuals began to “play the game of political passions,” those who had “acted as a check on the realism of the people began to act as its stimulators.” And this is why Michael Moore is correct when he blames The New York Times and the liberal establishment, even more than George W. Bush and Dick Cheney, for the Iraq War.

“The desire to tell the truth,” wrote Paul Baran, the brilliant Marxist economist and author of “The Political Economy of Growth,” is “only one condition for being an intellectual. The other is courage, readiness to carry on rational inquiry to wherever it may lead … to withstand … comfortable and lucrative conformity.”

Those who doggedly challenge the orthodoxy of belief, who question the reigning political passions, who refuse to sacrifice their integrity to serve the cult of power, are pushed to the margins. They are denounced by the very people who, years later, will often claim these moral battles as their own. It is only the outcasts and the rebels who keep truth and intellectual inquiry alive. They alone name the crimes of the state. They alone give a voice to the victims of oppression. They alone ask the difficult questions. Most important, they expose the powerful, along with their liberal apologists, for what they are.