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An Extraordinary Coup?
Submitted by Leo Kolivakis, publisher of Pension Pulse.
Bill Totten sent me a very interesting article from David DeGraw published on Alternet, The Economic Elite Have Engineered an Extraordinary Coup, Threatening the Very Existence of the Middle Class:
"The American oligarchy spares no pains in promoting the belief that it does not exist, but the success of its disappearing act depends on equally strenuous efforts on the part of an American public anxious to believe in egalitarian fictions and unwilling to see what is hidden in plain sight." -- Michael Lind, To Have and to Have Not
We all have very strong differences of opinion on many issues. However, like our founding fathers before us, we must put aside our differences and unite to fight a common enemy.
It has now become evident to a critical mass that the Republican and Democratic parties, along with all three branches of our government, have been bought off by a well-organized Economic Elite who are tactically destroying our way of life. The harsh truth is that 99 percent of the U.S. population no longer has political representation. The U.S. economy, government and tax system is now blatantly rigged against us.
Current statistical societal indicators clearly demonstrate that a strategic attack has been launched and an analysis of current governmental policies prove that conditions for 99 percent of Americans will continue to deteriorate. The Economic Elite have engineered a financial coup and have brought war to our doorstep...and make no mistake, they have launched a war to eliminate the U.S. middle class.
To those who feel I am using extreme rhetoric, I ask you to please take a few minutes of your time to hear me out and research the evidence put forth. The facts are there for the unprejudiced, rational and reasoned mind to absorb. It is the unfortunate reality of our current crisis.
Unless we all unite and organize on common ground, our very way of life and the ideals that our country was founded upon will continue to unravel.
Before exposing exactly who the Economic Elite are, and discussing common sense ways in which we can defeat them, let's take a look at how much damage they have already caused.
Casualties of Economic Terrorism, Surveying the Damage
The devastating numbers across-the-board on the economic front are staggering. I'll go through some of them here, many we have already become all too familiar with. We hear some of these numbers all the time, so much so that it appears as if we have already begun "to normalize the unthinkable." You may be sick of hearing them, but behind each number is an enormous amount of individual suffering, American lives and families who are struggling worse than they ever have.
America is the richest nation in history, yet we now have the highest poverty rate in the industrialized world with an unprecedented amount of Americans living in dire straights and over 50 million citizens already living in poverty.
The government has come up with clever ways to downplay all of these numbers, but we have over 50 million people who need to use food stamps to eat, and a stunning 50 percent of U.S. children will use food stamps to eat at some point in their childhoods. Approximately 20,000 people are added to this total every day. In 2009, one out of five U.S. households didn't have enough money to buy food. In households with children, this number rose to 24 percent, as the hunger rate among U.S. citizens has now reached an all-time high.
We also currently have over 50 million U.S. citizens without health care. 1.4 million Americans filed for bankruptcy in 2009, a 32 percent increase from 2008. As bankruptcies continue to skyrocket, medical bankruptcies are responsible for over 60 percent of them, and over 75 percent of the medical bankruptcies filed are from people who have health care insurance. We have the most expensive health care system in the world, we are forced to pay twice as much as other countries and the overall care we get in return ranks 37th in the world.
In total, Americans have lost $5 trillion from their pensions and savings since the economic crisis began and $13 trillion in the value of their homes. During the first full year of the crisis, workers between the age of 55 - 60, who have worked for 20 - 29 years, have lost an average of 25 percent off their 401k. "Personal debt has risen from 65 percent of income in 1980 to 125 percent today." Over five million U.S. families have already lost their homes, in total 13 million U.S. families are expected to lose their home by 2014, with 25 percent of current mortgages underwater. Deutsche Bank has an even grimmer prediction: "The percentage of 'underwater' loans may rise to 48 percent, or 25 million homes." Every day 10,000 U.S. homes enter foreclosure. Statistics show that an increasing number of these people are not finding shelter elsewhere, there are now over 3 million homeless Americans, the fastest-growing segment of the homeless population is single parents with children.
One place more and more Americans are finding a home is in prison. With a prison population of 2.3 million people, we now have more people incarcerated than any other nation in the world -- the per capita statistics are 700 per 100,000 citizens. In comparison, China has 110 per 100,000, France has 80 per 100,000, Saudi Arabia has 45 per 100,000. The prison industry is thriving and expecting major growth over the next few years. A recent report from the Hartford Advocate titled "Incarceration Nation" revealed that "a new prison opens every week somewhere in America."
Mass Unemployment
The government unemployment rate is deceptive on several levels. It doesn't count people who are "involuntary part-time workers," meaning workers who are working part-time but want to find full-time work. It also doesn't count "discouraged workers," meaning long-term unemployed people who have lost hope and don't consistently look for work. As time goes by, more and more people stop consistently looking for work and are discounted from the unemployment figure. For instance, in January, 1.1 million workers were eliminated from the unemployment total because they were "officially" labeled discouraged workers. So instead of the number rising, we will hear deceptive reports about unemployment leveling off.
On top of this, the Bureau of Labor Statistics recently discovered that 824,000 job losses were never accounted for due to a "modeling error" in their data. Even in their initial January data there appears to be a huge understating, with the newest report saying the economy lost 20,000 jobs. TrimTabs employment analysis, which has consistently provided more accurate data, "estimated that the U.S. economy shed 104,000 jobs in January."
When you factor in all these uncounted workers -- "involuntary part-time" and "discouraged workers" -- the unemployment rate rises from 9.7 percent to over 20 percent. In total, we now have over 30 million U.S. citizens who are unemployed or underemployed. The rarely cited "employment-participation" rate, which reveals the percentage of the population that is currently in the workforce, has now fallen to 64 percent.
Even based on the "official" unemployment rate, just to get back to the unemployment level of 4.6 percent that we had in 2007, we need to create over 10 million new jobs, and most every serious economist will tell you that these jobs are not coming back. In fact, we are still consistently shedding jobs, on just one day, January 27, several companies announced new cuts of more than 60,000 jobs.
Due to the length of this crisis already, millions of Americans are reaching a point where the unemployment benefits they have been living on are coming to an end. More workers have already been out of work longer than at any point since statistics have been recorded, with over six million now unemployed for over six months. A record 20 million Americans qualified for unemployment insurance benefits last year, causing 27 states to run out of funds, with seven more also expected to go into the red within the next few months. In total, 40 state programs are expected to go broke.
Most economists believe the unemployment rate will remain high for the foreseeable future. What will happen when we have millions of laid-off workers without any unemployment benefits to save them?
Working More for Less
The millions struggling to find work are just part of the story. Due to the fact that we now have a record high six people for every one job opening, companies have been able to further increase the workload on their remaining employees. They have been able to increase the amount of hours Americans are working, reduce wages and drastically cut back on benefits. Even though Americans were already the most productive workers in the world before the economic crisis, in the third quarter of 2009, average worker productivity increased by an annualized rate of 9.5 percent, at the same time unit labor cost decreased by 5.2 percent. This has led to record profits for many companies. Of the 220 companies in the S&P 500 who have reported fourth-quarter results thus far, 78 percent of them had "better-than-expected profits" with earnings 17 percent above expectations, "the highest for any quarter since Thomson Reuters began tracking data."
According to the Bureau of Labor Statistics, the national median wage was only $32,390 per year in 2008, and median household income fell by 3.6 percent while the unemployment rate was 5.8 percent. With the unemployment rate now at 10 percent, median income has been falling at a 5 percent rate and is expected to continue its decline. Not surprisingly, Americans' job satisfaction level is now at an all-time low.
There are also a growing number of employed people who, despite having a job, are still living in poverty. There are at least 15 million workers who now fall into this rapidly growing category. $32,390 a year is not going to get you far in today's economy, and half of the country is making less than that. This is why many Americans are now forced to work two jobs to provide for their family to hopefully make ends meet.
A Crime Against Humanity
The mainstream news media will numb us to this horrifying reality by endlessly talking about the latest numbers, but they never piece them together to show you the whole devastating picture, and they rarely show you all the immense individual suffering behind them. This is how they "normalize the unthinkable" and make us become passive in the face of such a high causality count.
Behind each of these numbers, is a tremendous amount of misery; the physical toll is only outdone by the severe psychological toll. Anyone who has had to put off medical care, or who couldn't get medical care for one of their family members due to financial circumstances, can tell you about the psychological toll that is on top of the physical suffering. Anyone who has felt the stress of wondering how they were going to get their child's next meal or their own, or the stress of not knowing how they are going to pay the mortgage, rent, electricity or heat bill, let alone the car payment, gas, phone, cable or Internet bill.
There are now well over 150 million Americans who feel stress over these things on a consistent basis. Over 60 percent of Americans now live paycheck to paycheck.
These are all basic things every person should be able to easily afford in a technologically advanced society such as ours. The reason we struggle with these things is because the Economic Elite have robbed us all. This amount of suffering in the United States of America is literally a crime against humanity.
David DeGraw followed up with another article, The Richest 1% Have Captured America's Wealth -- What's It Going to Take to Get It Back?:
"The war against working people should be understood to be a real war.... Specifically in the U.S., which happens to have a highly class-conscious business class.... And they have long seen themselves as fighting a bitter class war, except they don't want anybody else to know about it." -- Noam Chomsky
As a record amount of U.S. citizens are struggling to get by, many of the largest corporations are experiencing record-breaking profits, and CEOs are receiving record-breaking bonuses. How could this be happening, how did we get to this point?
The Economic Elite have escalated their attack on U.S. workers over the past few years; however, this attack began to build intensity in the 1970s. In 1970, CEOs made $25 for every $1 the average worker made. Due to technological advancements, production and profit levels exploded from 1970 - 2000. With the lion's share of increased profits going to the CEO's, this pay ratio dramatically rose to $90 for CEOs to $1 for the average worker.
As ridiculous as that seems, an in-depth study in 2004 on the explosion of CEO pay revealed that, including stock options and other benefits, CEO pay is more accurately $500 to $1.
Paul Buchheit, from DePaul University, revealed, "From 1980 to 2006 the richest 1% of America tripled their after-tax percentage of our nation's total income, while the bottom 90% have seen their share drop over 20%." Robert Freeman added, "Between 2002 and 2006, it was even worse: an astounding three-quarters of all the economy's growth was captured by the top 1%."
Due to this, the United States already had the highest inequality of wealth in the industrialized world prior to the financial crisis. Since the crisis, which has hit the average worker much harder than CEOs, the gap between the top one percent and the remaining 99% of the US population has grown to a record high. The economic top one percent of the population now owns over 70% of all financial assets, an all time record.
As mentioned before, just look at the first full year of the crisis when workers lost an average of 25 percent off their 401k. During the same time period, the wealth of the 400 richest Americans increased by $30 billion, bringing their total combined wealth to $1.57 trillion, which is more than the combined net worth of 50% of the US population. Just to make this point clear, 400 people have more wealth than 155 million people combined.
Meanwhile, 2009 was a record-breaking year for Wall Street bonuses, as firms issued $150 billion to their executives. 100% of these bonuses are a direct result of our tax dollars, so if we used this money to create jobs, instead of giving them to a handful of top executives, we could have paid an annual salary of $30,000 to 5 million people.
So while US workers are now working more hours and have become dramatically more productive and profitable, our pay is actually declining and all the dramatic increases in wealth are going straight into the pockets of the Economic Elite.
If our income had kept pace with compensation distribution rates established in the early 1970s, we would all be making at least three times as much as we are currently making. How different would your life be if you were making $120,000 a year, instead of $40,000?
So it should come as no surprise to see that we now have the highest inequality of wealth in the industrialized world and the highest inequality of wealth in our nation's history. The backbone of America, a hard working middle class that has made our country a world leader, has been devastated.
Now that we have a better understanding of how our income has been suppressed over the past forty years, let's take a look at how the economy has been designed to take the limited money we receive and put it into the hands of the Economic Elite as well.
Costs of Living
Other than in the workplace, in almost all our costs of living the system is now blatantly rigged against us. Let's take a look at it, starting out with our tax system.
In total, the average US citizen is forced to give up approximately 30% of our income in taxes. This tax system is now strategically designed to flow straight into the hands of the Economic Elite. A huge percentage of our tax dollars ultimately end up in their pockets. The past decade proves that -- whether it's the Republicans or the Democrats running the government -- our tax money is not going into our community, it is going into the pockets of the billionaires who have bought off both parties - it is obscene.
For an example of how this system flows to the Economic Elite, just look at the Wall Street "bailout." The real size of the bailout is estimated to be $14 trillion - and could end up costing trillions more than that. By now you are probably also sick of hearing about the bailout, but stop and think about this for a momentÖ Do you comprehend how much $14 trillion is?
What could be accomplished with this money is almost beyond common comprehension.
And this is just the tip of the iceberg that has hit us. On top of the trillions given to the Wall Street elite, we already have a record $12.3 trillion in national debt - and we now have to pay $500 billion in interest to the Economic Elite on this debt every year, yet another way they are milking us dry. When you add in unfunded liabilities owed, like social security payments, we actually owe a stunning $74 trillion. That adds up to a debt of $242,000 for every man, woman and child in America.
Trillions more, 25% of taxpayer dollars allocated to military spending goes unaccounted for every year, not to mention the billions spent on overcharging and outright fraud. During the War on Terror, the Economic Elite have used our tax money to build a private army that has more soldiers deployed than the US military - a congressional study revealed that 69% of the "US" fighting forces deployed throughout the world in our name are in fact private mercenaries, 80% of them are foreign nationals. Private contractors regularly get paid three to five times more than our soldiers, and have been repeatedly caught overcharging and committing fraud on a massive scale. A congressional investigation revealed this and strongly recommended that we seize wasting tax dollars on these private military contractors. However, under Obama, there has actually been a drastic increase in total tax dollars spent on them.
In 2009, just over $1 trillion tax dollars were spent on the military, it's safe to say that at least $350 billion of that was needlessly wasted.
When you research our tax system you see an unprecedented level of waste and fraud rampant throughout most expenditures. Our tax system is a national disaster of epic proportions. It is literally an organized criminal operation that continues to rob us in broad daylight, with zero accountability.
Politicians and mainstream "news" outlets will not tell you this, but most every serious economist knows that due to so much theft and debt created in the tax system, the only way to fix things, other than stopping the theft and seizing the trillions that have been stolen, will be for the government to cut important social funding and drastically raise our taxes. Other than the record national debt, many states are running record deficits and ìbarreling toward economic disaster, raising the likelihood of higher taxes, more government layoffs and deep cuts in services.î Our nation's biggest state economies, like California and New York, are the ones in most trouble.
To merely say that things will not be improving economically is to be a delusional optimist. The truth that you will not hear: we have been hit by an economic deathblow and the United States lay in ruins.
It's not just this criminal tax system; the theft is now built into all our costs of living.
Trillions more in our spending on food and fuel has been stolen due to fraudulent stock transactions and overcharging. Just ten years ago, in 2000, American families paid 7% of our income on food and fuel. We now pay 20%. This drastic increase is primarily driven by fraudulent market manipulation that drives up stock prices. Congress uncovered this in 2006, as part of the Enron investigation they found that companies manipulated the oil market to create major spikes in stock values, and then they didn't do anything about it - nothing to see here, just move on.
As mentioned before, we have the most expensive health care system in the world and we are forced to pay twice as much as other countries, and the overall care we get in return ranks 37th in the world. On average, US citizens are now paying a record high 8% of their income on medical care.
Part of the reason why foreclosure rates are so high is because the percentage of income Americans pay on their housing has risen to 34%.
So for these basic necessities - taxes, food, fuel, shelter and medical bills - we have already lost 92% of our limited income. Then factor in ever-increasing interest rates on credit cards, student loans, rising prices for cable, internet, phone, bank fees, etc., etc., etcÖ. We are being robbed and gouged in all costs of living, in every aspect of our life. No wonder bankruptcies are skyrocketing and the amount of people suffering from psychological depression has reached an epidemic level.
The American worker is screwed over every step of the way, and it all starts with the explosion in the cost of a college education. This is one of the Economic Elite's most devastating weapons. To have any chance of succeeding in this economy, it is commonly believed that you must attend the best college possible. With the rising costs involved, today's students are graduating with record levels of debt from student loans. At the same time, the unemployment rate among recent college graduates has risen higher than the national average, and those that do find work are making significantly less than they expected to make. This combination of extreme debt and reduced pay has crippled an entire generation right from the start and has put them in a vicious cycle of spiraling debt that they will struggle with for the rest of their lives. The most recent college graduates are now known as a "lost generation."
The American dream has turned into a nightmare. The economic system is a sophisticated prison cell; the indentured servant is now an indebted wage slave; whips and chains have evolved into debts.
"There are two ways to conquer and enslave a nation. One is by sword. The other is by debt." -- John AdamsConcealing National Wealth
"Liberty in the concrete signifies release from the impact of particular oppressive forces; emancipation from something once taken as a normal part of human life but now experienced as bondage... Today, it signifies liberation from material insecurity and from the coercions and repressions that prevent multitudes from participation in the vast cultural resources that are at hand."-- John Dewey
When you take the time to research and analyze the wealth that has gone to the economic top one percent, you begin to realize just how much we have been robbed. Trillions upon trillions of dollars that could make the lives of all hard working Americans much easier have been strategically funneled into the coffers of the Economic Elite. The denial of wealth is the key to the Economic Elite's power. An entire generation of massive wealth creation has been strategically withheld from 99% of the US population.
The US public doesn't have any understanding of how much wealth has been generated and concentrated into the hands of the Economic Elite over the past 40 years; there is no historical frame of reference. This withholding of wealth is truly the greatest crime against humanity in the history of civilization.
What could be done with all the money that has been hoarded by the Economic Elite is extraordinary!
Let's consider what we could do with the money that has been stolen from us? On top of what should be our average six-figure yearly income, we could have:
* Free health care for every American,
* A free 4 bedroom home for every American family,
* 5% tax rate for 99% of Americans,
* Drastically improved public education and free college for all,
* Significantly improved public transportation and infrastructure,The list goes on...
This is not some far-fetched fantasy. These are all things that Franklin D. Roosevelt talked about doing in the 1940's, long before the explosion of wealth creation in our technologically advanced global economy. The money for all this is already there, stashed into the claws of the Economic Elite. The denial of wealth to the masses is the key to the Economic Elite's power. Outside of outdated and obsolete economic models and theories -- and incredibly short-sighted greed -- there is no reason why all this money should be kept in the hands of a few, at the immense suffering and expense of the many.
If Americans could just understand how much wealth is being withheld from us, we would have a massive uprising and the Economic Elite would be swept away, into the history books alongside the evil despots of the past.
I realize many of you will dismiss Mr. DeGraw's writings as socialist banter, but I will add that as far as I am concerned, the real master coup revolves around pensions and mutual funds. Many people have no clue where their pensions are being invested, who is profiting off the misfortune of others and what a racket mutual funds are charging exorbitant fees for mediocre results.
There is a financial coup going on right now across the world and while it may have started in the United States, the debt disease is spreading across the globe at the speed of light. Where and how will this all end? Can capitalism survive if wealth is increasingly being concentrated in the hands of an economic elite that shows no sense of civic and moral duty to the societies they inhabit?
Karl Marx may be dead and his theories debunked, but I have a sick feeling in my gut that down the road, his dire prediction that capitalism is destined to self-destruct will ultimately be proven right.
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This country and its capitalism has afforded all of us with an amazing standard of living. You are right however that all of this is being hijacked. But what EVERYBODY seems to miss is this:
If a true deflation were allowed to happen, a deflation that we have EARNED through high productivity, A DEFLATION of costs for real estate, schooling, healthcare, we would all PROSPER even if our salaries were stagnant. BUT THE FED AND THE GOVT, after leveling world trade, allowing OUR salaries to stagnate but pumping cash and regulations to keep prices UP is squeezing us from all sides...
This is a refreshing conversation here.
I don't agree that poverty in the traditional sense is evident. People, particularly in the US are obese. I don't see thin, starving children in the schools. I don't see folks living in small modest homes. There appears to be enough wealth to afford new cars. I don't see a lot of old rusting clunkers on the roads. There are lots of cell phones and gadgets in the hands of everyone.
This isn't to say life isn't hard or that the stresses are not there. I feel them. The physical realities simply don't show a population of poor people, at least through my eyes. Perhaps it's different elsewhere. The stresses will reveal themselves in the longer term. Actually I have the opinion that a cessation of consumption is a healthy change. Conservation should become part of the public discourse.
People are obese because they eat like shit, mostly fast food junk. This is another sign of the new poverty facing millions of Americans. In many inner cities, you can't find fresh fruits and vegetables. Super size fast food junk and then we wonder why poor kids don't do well in school. They are being groomed for failure, for a life of economic hardship.
Correct Leo. Poor diet WILL cause other ailments such as:
- Depression
- Anxiety
- Sleep disorders
- Every physical disorder you can dream up
Americans (and westerners in general) are terribly unhealthy. Solve this problem, you'll have no more healthcare debates either.
Unfortunately "fast-food" is often the cheapest way for the poor (and arguably lazy) to get the calories they need at a reasonable cost. Now the quality of these calories and the amount of fat, salt and high fructose corn sryup these foods contain are a whole other matter.
I have my doubts that people will get religion on diet and exercise until after a period of imposed restraint (on eating and consumption in general) and enforced exercise (because more will be forced to walk or ride a bike to the store than drive). This is the good part of a protracted recession/depression for a society plagued by all the disorders you cite. Eventually people will notice their weight has dropped, they are sleeping better and, despite their economic woes, their world is not necessarily coming to an end. In fact better physical health through diet, moderate exercise and improved sleep quality will make a big difference in the way people deal with the same economic stresses that are ironically (and serendipitously) improving their physical well-being. A positive feed back loop with surprising benefits - number one being more healthy people equaling less health care services (and future expenses).
Thanks for this post Leo.
You think the fast food joints would still be there if no one went there to eat? People have choice, to some extent. I'll tell you what Leo, stay in Quebec. You fit right in with the rest of the collectivists.
We are definitely failing to provide for our children. It's sickening. Money is being mispent on shit.
sweat shop slave labor much?
wonder why you get sick when you eat crap?
look up nikola tesla, viktor schauberger, raymond royal rife, henry moray, etc. for some real answers.
http://www.rexresearch.com/1index.htm
http://thesynagogueofsatan.com/
http://www.drweil.com/
http://www.permaculture.org/nm/index.php/site/index/
http://www.hemptopia.org/Hemp_for_Victory.php
http://judicial-inc.biz/
http://www.rense.com/
http://www.muslimamerica.net/cz/index.htm
have fun!
I just wonder how many people are collecting unemployment benefits and food stamps while actually working and collecting cash for their services.
It seems clear that the government statistics cant be relied upon nor can members of congress or the government. Every time Obama opens his mouth he sounds like the anti-Bush. They both speak drivel. While its obvious that Bush is very challenged, Obama is like a very smart patient in a mental institution, it takes a while to realize that what he is saying is disconnected from reality.
Don't get me started on this! Leo, the middle classes themselves have gorged on debt, maxed out their credit cards, upped their standards of living to the clouds and cloaked themselves in so many perks, benefits, pensions, bonuses, and raises that true productivity is beggared. THEY didn't have to borrow to support consumption. They could have saved, could have invested. The old-fashioned thing to do when you couldn't afford some item was to MAKE DO, to GO WITHOUT.
And pray tell, why should a worker in retailing, government, service industry or paper-pushing earn more than $6 - $10/hour? Do they produce anything? Do they create wealth? Do they increase the size of the collective pie? Can their customers - domestic or foreign - still afford to buy the product of such expensive labour?
I'm not saying there aren't egregious examples of gouging by the L. Blankfeins and J. Thains of this world. I'm not saying that government isn't implicitly involved in that, either. But standards of living for the comparatively unproductive will - as in ANY country - continue to fall until the costs of their labour become competitive again on the worldwide stage...
Much of the world we compete with was shaped by corrupt or economically clueless leaders. You can't compete with people that have been impoverished by the actions of their corrupt or inept governments. Those actions are now impoverishing us too.
The middle class took on unsustainable debts to keep up as their incomes were destroied by futile attempts to compete with peasants.
I wouldn't call the American middle class worker "productive". Sure, he produces more widgets, more efficiently. But at what price? Labour costs ~ and standards of living ~ in the U.S. are astronomically high in comparison with those in much of the world.
I'd say the most productive workers are more likely to be in those "third-world" economies - or here in Taiwan! - where wage rates are reasonable.
Splendid! I suppose this means we can divert some of those lazy US military personnel and those F-15s engineered by lazy, overpaid unionized Boeing employees to more productive ends!
Frabjous day!
Ahhh it's wonderful to see concrete examples of confirmation bias at work.
Great read, Leo. See How We Are.
This is the easy part. Now what do we do? It seems the wake-up call will have to be very loud, and i think something more like freezing to death is going on.
Leo's best post yet, and one of the better articles on ZH this week at that.
America's health care system is not 37th in the world. What a pantload of crap saying that. The system delivers fine health care. The problem is its cost, partly driven by expenses not related to patient care. To get the good care we have will always be expensive though.It just doesn't have to be as expensive has it has gotten.
The economic pie has been shrunk by outsourcing of factory jobs, and the reduction of resource exploitation. We are critically denying our own people work to fatten the bottom line of individual companies. They're killing us by degrees.
Employment must rewarded enough to allow employees the opportunity to cover their own health care costs. Remove employer/union control over that benefit and allow employees unfettered access to the health care markets.
This is the best comment I have ever read. Your
health care solution is the only logical one for
the future. The biggest problem with it is that
Americans have gotten use to not paying for their
own health care. It will be hard to overcome the
years of having someone else pay for their health
care.
Finally a good piece from LK. See, Leo, when you publish non mainstream posts, you get a lot of reactions here on ZH ! I think I must feel like a lot of posters on this board, tired of seeing the daily lies on CNBC and the mainstream media and looking for a forum like ZH to express myself.
The only way to keep the boot of the elites off your throat is to make them fear for their necks
First, please define the elites.
I would like to thank all of you for sharing your responses here, many of which were excellent.
Leo, i thought you were bullish on the economy, what changed your mind?
Guess what? People get old and they die. I hate to be a dick, but even my father at 72 years of age realizes that spending $500,000.00 + to stay alive a few more years simply isn't economically viable. I hope the baby boomers and their children will see this truth, otherwise their progeny is doomed. As a personal note, my uncle had quadruple bypass at the age of 81 at the insistence of his children. He spent the next three years languishing in a bed at a cost of over $1.5 million. This kind of scenario will certainly bankrupt the country in the years to come.
I have three simple tax propositions that would change the landscape. I understand that realizing any would be impossible, but my assertion is that underlying political and economic apathy is directly a result of the current state of the three existing conditions that my propositions propose to change.
1. Eliminate income tax payroll withholding.
Instead of having an employer "withhold" income tax, let the complete salary be paid to each individual who would then be responsible to transfer money to federal, state, and local agencies that levy income tax. This could be accomplished by direct debit or some other means (market driven rather than employer cost), but the tax payer would actually understand the true "hit" on income.
2. Eliminate interest payment deductions completely.
These distort the cost of "borrowing."
3. Include medical benefits as taxable income.
Non-taxed medical insurance benefits, together with federal programs, turned "health care" into a chase for the pot of gold rather than a consumption driven market.
Adopt #1 and you'd see an across the board taxpayer revolt.
But maybe I just need more sleep.
1. We benefitted from cheap imports and illegal immigration. Now the dynamics are catching up to us.
2. We were stupid not to save for our futures and to borrow money instead.
3. We did not learn history, we did not learn real skills. We want high paying service jobs and someone else to do the dirty work. We want to be entertained and taken care of.
It will be painful to turn this around. Localism. Back to basics. Cooperation.
Faith. Wisdom. Charity.
YES!!!! You post truths!
* Free health care for every American,
Nothing is free, Social Security and Medicare are long term government ponzi schemes waiting to explode, their explosion will be nuclear.
* A free 4 bedroom home for every American family
I'd love to have section 8 people move in next to me
* 5% tax rate for 99% of Americans,
Sure, and the 1% you don't tax can move their money to Switzerland
* Drastically improved public education and free college for all
College is cheap, don't go to out of state schools
Community college is almost free
* Significantly improved public transportation and infrastructure
We can ride buses to our useless service jobs where we sell cell-phones to each other!
Liberal fantasy, the welfare state is going to eat itself because it discourages people from taking care of themselves.
Leo, t'is a sentiment I have long felt and shared, though until recently it was not a popular one among most people. However, I'd like to offer a counterpoint.
Your point about the inefficiencies of gov't programs are well taken, and I think they point to a very real problem. The US itself has become too big and too diverse, and as such it's becoming increasingly difficult to craft programs that can readily address all regions of the country equally. Couple that with the army of lobbyists working just within the DC Beltway, and it means that the process of implementing those programs almost invariably goes to these bloodsuckers, with financing arranged by the largest banks, all of whom take their (large) chunk before any of this money goes to the people who need it most.
This is not unique to the US, of course, and in fairness, there are other governments that are generally as corrupt, albeit in different ways (we don't have the same level of nepotism that seems to be endemic to most Central and South American countries, for instance). It's not even as bad as at past periods in the US - Obama's administration is a virtual model of virtue compared to presidents like Taft, Harding or Grant.
The difference is that the population is a couple of orders of magnitude larger, and we have watched the erosion of the middle class pretty much since the 1970s when the US became a net importer of oil for the first time. While the export of oil dramatically enriched the ruling elite, it also provided a major cushion that allowed for a prosperous middle class, especially relative to the far lower standards of Europe after WW II. The entitlement programs like social security and medicare all date from pre-peak US Oil, and the correlation between oil and the general strength of the economy was far from obvious.
If you assume that many of the economic assumptions that have been made in the last forty years have explicitly ignored the reality of ever higher oil prices eating into both governmental and corporate revenues, then the perspective shifts. The criminals, shysters and con artists have always been with us, but they have generally been far less obvious because the general welfare of the population has been high. Receding oil availability is manifesting in the middle class shrinking faster than the upper class (who generally have been able to diversify their holdings), much like receding tides expose sharp rocks that would otherwise stay hidden.
I don't personally believe that there is some kind of broad upper class conspiracy to destroy the middle class - greed, stupidity, erroneous models and a sense of entitlement at all levels are doing that quite well anyway.
Indeed, a little thought would dispell a lot of that: the bankers, financial services people, lobbyists and so forth are parasites - they feed upon the general population, and feed best when that population is itself fairly wealthy. Most are leery about feeding off the government directly - changing political winds can wreak havoc upon their business models, there are frequently strings (ropes, or even chains) attached to such contracts that can dramatically increase their liability, and all it takes is one maverick auditor to bring them to their knees. As such, the parasites prefer to work at one remove, and the fact that its becoming impossible to do so says a great deal about the state of their own books.
Full blown class warfare will come - I don't have any real doubt about that, but it will come because the middle class, long somnolent, is beginning to wake up and see the reality of its own situation, and both are effectively now in competition for the same diminishing resources.
In the end, nobody will win - the wealthy represent a very small sliver of the overall population and hence are far more vulnerable to being wiped out, the middle class is discovering that the promises that were made to them in exchange for that complacency are no longer being honored and will catalyze into a revolutionary ferment (most revolutions are not populist uprisings of the poor but struggles between the upper middle class and the upper class for control), and the union will ultimately fracture and break apart as the glue of social cohesion dissolves. When the smoke finally clears, I expect that we'll have devolved into about six to eight semi-functional regional govenments and the process will start all over again.
So why don't we turn the computer off, lease some old school buses and load them up with like-minded folks, head down to the elites home address on and have a little pow-wow.
Maybe some one-on-one time with these so called "elites" can possibly educate us on why their shit doesn't stink as bad as ours. Lets find out if they can really turn water into wine.
Let's pull that school bus right up on the front lawn, break out our goodwill lawn furniture and have a fucking tailgate party right by the marble fountains!
Let's get to the bottom of this! We'll call it a beer summit!
Who knows, maybe they deserve houses bigger then the Pentagon.
Let's do it people!
Who's with me?
good luck with that. these people have security for their security.
nice sum up, and you allude to something that is a bit of quandry for US, in say 50s, 60s, early 70s we had flat incomes, wide-big middle class, without a lot of govt or elite/financial parasites (while taxes were high for rich overall tax burden for regular folks not to bad), banks we in check, housing was reasonably priced, etc...but at this time we were big time (not necessarily intentional) parasites of rest of world. We got cheap oil, minerals, labor etc from rest of world, because we essentially inherited colonies of Europe and Japan...and other developed countries, our competition so to speak had their industrial capability wiped out. So our internal society was fairly equal economically, but we were on top of world heap, consuming 50 to 100 times the resources per person as people in developing nations...
Yup. It's the classic empire trap. Empires occur when a country reaches a stage where it is reasonably large to begin with and it's internal energy production cannot meet the demands for growth of the society - and the surrounding cells in the network are weakened. It's the societal equivalent of cancer.
The empire has to expand to feed its own growing needs, but as it expands it requires more energy. Eventually the empire reaches a stage where it can no longer grow fast enough to meet its need and it collapses. Typically, this is a temporary shot in the arm for the parasitical upper class - as the empire collapses, it's energy demands drop, which typically manifests in the upper class going from very rich to obscenely rich, but this is usually a prelude to hyperinflation as the middle class loses faith in the currency of the system. The burn rate for the upper class during this period is actually pretty short - their expenses are also far higher for someone in the upper class, and without sustained income the windfall disappears in short order.
This is one of the things that most people who point to the Great Depression fail to see. In 1930, the US was a net exporter of energy, the economic base was shifting from an agrarian to an industrial one, most of the major technical innovations of the 20th century were still largely ahead of them, and the US had largely integrated most of its territory (aka net producers of energy) in the previous century. At the time, Keynesian policies worked, because borrowing from the future could be done at relatively low cost - there was a lot of energy potential available to fund the growth. Even given that, it would take the austerity measures of World War II and the corresponding harnessing of what remained of wealth from upper class to get out of the Depression, and that largely because, as you point out correctly (and thanks for that - it's a useful insight), we had effectively inherited everyone else's colonies.
I used to be a Keynesian, but I'm not really much of one anymore, because I think this time things are different. We have an oil-based economy, and the costs to transition out of that to a purely electric economy (which I feel is necessary) are in the tens of trillions of dollars.
Let's say we build those nuclear power plants that Obama has given the green light on (and I think that there is room there for nuclear in the equation, though it has its own decline graph to worry about), and even more, let's say that we manage to figure out how to create mixed space-based microwave pV systems and even, just for speculation, we manage to get fusion generation working as a viable energy producer by 2035 or so).
Unfortunately, even with all of this potential power coming online, we still have to change the underlying oil economy to an electric one or the biggest costs - transportation, distribution, and agriculture - will beggar us. We will have to build out a whole new net energy infrastructure, will have to reorient the way that we build our cities, will have to shift our expectations about food production dramatically and will have to do so in a way that doesn't cause massive disruptions to the underlying financial infrastructure necessary to finance this.
My personal belief is that this will happen, but it won't happen at the Federal level. The US Government is too hopelessly compromised, has too many existing contracts and processes in place that are geared towards sustaining the oil economy. It won't happen fast enough to support the social stresses that are on the country now and that are growing. It's possible that it may have been possible (barely) in 1990, though it would have been at a much cruder level of technology, but now ... I'd be surprised.
One of the other lessons about empires is that as they collapse, those regions formerly in the empire that are best able to marshall their own energy systems (or take them back from the imperial system) are the ones that usually end up surviving to become nation-states in their own right. This will be true during the 21st century. The US is large, and moreover is made up of former semi-sovereign states (Texas, California, Alaska, others), many of whom have very different political and social values than those found closer in to the center of power. If the USD goes into a period of hyperinflation, these states have the ability to finance their own currency, and if the situation becomes severe enough, the political will. Once that happens, sovereignty isn't far behind.
Strange to tackle this issue through money.
In the 1950s, the situation was such that the former colonial empires fell. The fall meant that the former colonial powers stop withdrawing their turf from the other colonial powers. On the contrary, colonial powers agreed on ganging on these former territories. Consequences: an unprecedented access to a pool of resources.
Today, the situation is different, the world is global and the access to the world pool of resources is near optimization.
The transition might not be possible, not because of money but because of availability of resources. Money through credit is not an issue.
Comparison to the past is hard to achieve as it is the first time in human history a society can support itself through the resources available throughout the world.
Up to now, a share of resources (and a sizeable one) was hidden from any empire that was.
Personally, I found the approach of collapse, fragmentation of a state terribly naive.
'As mass production has to be accompanied by mass consumption, mass consumption, in turn, implies a distribution of wealth -- not of existing wealth, but of wealth as it is currently produced -- to provide men with buying power equal to the amount of goods and services offered by the nations economic machinery. Instead of achieving that kind of distribution, a giant suction pump had by 1929-30 drawn into a few hands an increasing portion of currently produced wealth. This served them as capital accumulations. But by taking purchasing power out of the hands of mass consumers, the savers denied to themselves the kind of effective demand for their products that would justify a reinvestment of their capital accumulations in new plants. In consequence, as in a poker game where the chips were concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped.That is what happened to us in the twenties. We sustained high levels of employment in that period with the aid of an exceptional expansion of debt outside of the banking system. The time came when there were no more poker chips to be loaned on credit. Unemployment further decreased the consumption of goods, which further increased unemployment, thus closing the circle in a continuing decline of prices.This then, was my reading of what brought on the depression.'
-Marriner S. Eccles
http://anonymousmonetarist.blogspot.com/2010/02/what-has-been-will-be-ag...
Sounds precisely like what happened over the last 30 years.
Anon here.
It’s the paradox of capitalism... but only in the context of a financial system that abets inflation.
Very astute, Anon.
I saw Zeitgeist, the final cut and that did it for me. It finalized everything i had learned until then. No, i did not wish to believe or acknowledge that 9/11 was an inside job.
Common sense and evidence has since persuaded me.
I am so sorry to state what i know to be true.
We live under a criminal government.
Yep... But like every social and economic ideology, the eventual destruction is assured because of the systems inability to evolve at the pace of the collective consciousness which to a large degree is shaped by tecnological innovation.
Just as evolution applies to species, so it does to economic systems (creative destruction). What is happening now is a direct result of past failures, and the breakdown of todays system is as unavoidable as it is absolutely necessary in order to create a stronger framework for tomorrows improved social and economic ideals. What works will remain, what failed will be replaced...
For as far back as one can look at civilised mans varied societal structures, every failure has given birth to another but we always maintain what works and this builds the stregth of the foundation. Creation and destruction are two means leading to the same end...
In my opinion, its easy to see that the future will combine the best traits of capitalism, democracy and socialism and yes, despite the psyop beating our minds have all recieved, these forces can, do and will work together...
My only hope is that we can avoid as much needless pain as possible, but I'm not confident as human suffering on a massive scale is the midwife to the greatest changes and I for one am certain that we face a great change indeed...
"All great things must first wear terrifying and monstrous masks in order to inscribe themselves on the hearts of humanity" Nietzsche...
It would be great if what "works" would be maintained, and we could, as a society discard what does't. However, reality is not that simple. If we were really to eliminate what doesn't work we would have many bankers, executives, politicians and regulators in jail for having perpetrated and allowed fraudulent activities. The problem is that the social engineers and power brokers decide, all by themselves, what "works" ( for them of course, not necessarily for society as a whole ) and purge what doesn't ( which in this case is the middle class, which is not working out for them and it's the only class that can challenge their hegemony ). So in this case they apply their might to make things right leaving most of society without a choice in these matters.
There is a lot of change going on at the moment, however, one has to take into consideration the problem-reaction-solution model that is being used to guide society into a configuration that may not be the optimal for most of its members, or that most members would not agree with. So, pain and birth pangs, are not necessarily and unquestionably the path to a "better" state of affairs, after all there is also pain when dark ages are born too.
If all great things must first wear a terrfying mask, then one has to be careful to notice when terrible things wear a terryfing mask too and to be able to tell the difference between what is really being created ...
Even a step back can be a step forward, its all about relativity... But yeah, you kinda just reaffirmed my view, we're just observing from oppposing standpoints ;-)
great point, unfortunately, its not always a nice straight line of progress...current example Iran...US (and Brits) interfered and took out their popular nationalistic leader Mossadeq because he nationalized oil...our CIA then propped up the Shah, who was repressive enough to get most everyone but the richest cronies protesting him, opposing his torture, his jailing of journalists...but then after revolution, theocracy took hold and within a year they were jailing some of same journalists as Shah, were using Shah's personal torture guy etc...til new regime had tortured and killed order of magnitude more people than Shah...and still after "green" protest of latest elections, they get no improvements..last 50 years rough for average Iranian...
Your article is compelling and I largely agree with it but there is one glaring ommission. CHOICE! People choose to be fat, they choose to be ignorant, they choose to buy a house they cannot afford and they choose to live on credit cards.
All the 'economic elites' do is offer up a crooked game, no one is forced to play it. Because we have developed this something for nothing mentality, we choose en masse to play the game and seem suprised when we lose.
Live within your means, stay fit and consider education as a lifelong journey. If you live that way you too will be rich.
See, this is where you are wrong. Because the persistent inflation of the fiat system continually eats away at savings, anyone who wants to save money for the future HAS NO CHOICE but to play the market in one form or another. This is exactly where the true evil of fiat currency is exposed.
leo a little learning could be dangerious ,, even a free down load
http://www.capitalism
http://www.capitalism.net/articles/A_Blog_11_09.html#Start
Nice link.
And for everyone else out there that would like to know the truth behind the incessant meme that medical costs are somehow a bigger part of bankruptcies than in the past check this out.
www.realclearmarkets.com/articles/2009/07/30/the_medical_bankruptcy_myth_97335.html
The Himmelstein study paints a picture of an American middle class that even with health insurance coverage is being bankrupted by health care costs. The share of bankruptcies attributable to health care costs rose by 50%between 2001 and 2007, according to the study. The message is that rising health care costs bankrupt the insured middle class as well as the uninsured lower class.
The only problem is that the study is fatally flawed. Dr. Himmelstein is a co-founder of Physicians for a National Health Program, an organization that describes itself on its Web site as "the only national physician organization in the United States dedicated exclusively to implementing a single-payer national health program." An additional Harvard coauthor, Dr. Steffie Woolhandler, is co-founder and secretary of the organization. Even though the article states on the front page that the authors have no conflict of interest, two are self-declared activists for single-payer health care, and they have twisted the data to fit their cause.
Hey everyone, Anon here.
What I would like to know is who are these economic elites? Are they the Bill Gates and Soros' of the world or is something far more clandestine afoot or maybe something altogether different - such as system design leading to these results?
Yes, indeed....who are these economic elites, these crimnal masterminds sucking the blood out of American taxpayers to fuel their bloated lifestyles and crazed political ambitions? Well, lets see...
Exhibit A. Nameless *bankster* swindling millions thru front-running, bail-outs, etc. Said bankster piles up $20 million. Come on, peasants, let's build the gibbet and hang the SOB, that wicked bankster.
Exhibit B. ten retired educrats in my neighborhood, all with retirement schemes valued in the low to mid seven figures. In the aggregate, the theft is as bad as the bankster's. Come on, peasants, let's build the gibbets and hang the SOBs, those wicked public servants.
How easy it is to foment hate at nameless banksters; less easy with neighbor Dorothy.....Do you have the moral courage to claw back her ill-gotten gains as well?
@anon. #248487
"What I would like to know is who are these economic elites?"
Okay, here's a few;
- Rothschild - London, Bank of England
- J. Henry Schoder - Banking Corp.
- Brown, Shipley & Company
- Morgan Grenfell & Company
- Lazard Bros.
- Lord Mantagu Norman
- M. M. Warburg, Kuhn Loeb Co. NY
- Lehman Bros., Mayer, Herbert, Arthur, Emmanual, Irving, Phillip, Robert.
- Thomas Fortune Ryan, National Bank of Commerce, NY
- James Stillman
- William Rockefeller
- Percy Rockefeller
- J. P. Morgan
- M.T. Pyne
- Percy Pyne
- J. W. Sterling
- George F. Baker
Hey guys, original Anon that asked the ‘who are they’ question.
It’s a bit weird, because I know most of those names... not personally though I have been growing my letter head collection from some of those listed and their associated (mentioned throughout the thread). My personal opinion is that cranky old men are cranky.
The answer is a new global currency; convert everyone into it at a fixed rate and any transfer over 150,000 (savings and debts, bonds, securities etc.) to get the ‘where did you get this from?’ treatment. Answers such as, ‘well, I stole it,’ or ‘currency speculation and stock quant/fraud FTW!,’ and ‘well, I print just like the FED out of the Caymans!’ and ‘I swear, this OTC product is face value!’ and ‘of course I totally legitimately own 10 billion in stock even though my total take home pay has been 10 mil, what are you nuts?!’ will all be met with a ‘sorry, try burger king.’ And for the relevant States to take position of ill gotten or highly dubious assets and others to be totally nullified. Nullification is highly important. Then, institute a 100% reserve requirement on banks. Then serialize every cent that exist of this new currency and let all transactions forever be recorded in perpetuity.