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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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If that is a list of some of the Generalisimos, then here are a few of their Lieutenants...
Steve Cohen, Jim Chanos, John Paulson, David Einhorn, David Rocker, Lloyd Blankfein, Jim Cramer, Manuel Assensio, Michael Steinhardt, Marc Cohodes, Carl Icahn, Ivan Boesky, Michael Milken, etc...
These individuals have done their level best to steal the value of middle class' savings through countless variations of the timeless pump & dump.
And then there's George Soros... who has figured out he can effectively set policy by single handedly funding the progressive movement that now dominates the Democratic & Republican parties. Soros may actually be above all others in terms of influence in his grand scheme to rule the world.
This motley bunch may not control the Bank of England (with the exception of Soros), but each seems to have carved out his own empire. The common thread is each has pilfered the "dumb money" middle class of a prosperous future.
I would add RM Parsons and Bechtel to that list.
http://en.wikipedia.org/wiki/Parsons_Corporation
And, I would recommend John Perkins "Confessions of an Economic Hitman" and his most recent, regarding our current situation, "Hoodwinked" for further reading.
http://www.johnperkins.org/
I think its both, people who are rich and pay no attention to how to manipulate structure to make that possible, they just happen on it by luck, talent, connections, timing, family, whatever, and in their same class, there are some real conscious actors, plotting how to take more from more to give it to a smaller but richer elite.
As a reverse example..There are people out there very concerned with the plight of working class laborers and fight for things that will make their lives better, but there are also lots of workers not political, not organizationally active, and many workers may even vote against those that do themost work for their economic interests..this does not mean there are no aware organizers for workers (just because most workers not aware), same type of thing could be the case for rich folks...
Rothchild and bilderburg are names that keep popping up. JPMorgan been around a while but may just be a stooge.
I dont know who, but do feel like we are being harvested.
ALIENS?
"ALIENS?"
LOL. Now that's thinking outside the box...
Anon here.
I've thought about what is it that Rothschild or the club know... that I don't... and what are they doing that I'm not? My point is, there are many levers in this game of machinations and not all levers lay at one table.
they don't know anything that you don't. if you have several hundreds of billions of dollars at your disposal, and a psychopathic desire to own every human on the planet, all you have to do is plant the seeds and be patient.
Ok. But where do I plant them?
Maybe I put the seeds on TV... the humans I want to own seem to like TV?
Or maybe at the bar... they seem to like bars.
-Aliens (BBH)
Thanks, Leo. I am thinking of "The Great Gatsby" and "Titanic". And of course, Rome, whose oligarch families destroyed the middle class with imported labor and other measures made law by Rome's oligarch-controlled Senate. Does it seem that oligarchies always use pretty much the same methods, tricks, and rhetoric? (Note: Cato was an oligarch.) Perhaps those methods are simply the methods which always work. Also, I sometimes wonder whether some of those zillionaire Roman oligarch families became some of the feudal lords of medieval Europe, and then some of the owners of what evolved into the present cartel of central banks.
"Many people have no clue where their pensions are being invested, who is profiting of the misfortune of others and what a racket mutual funds are charging exorbitant fees for mediocre results."
x 100
That's what happens when instead of solid investment strategies, everyone chases the same inefficient indexes.
I want to know, who under the age of 40, beside govt employees have pensions anymore??? Like Leo expose on these things, but no one I know in their 40s, 30s, 20s has a pension besides govt employees and trade worker unions..
I'm 46, but I've also been an independent high tech consultant for more than a decade, a sector which I think far more reflects the future of employment than most. The vast majority of my circle of friends, business associates and colleagues may possibly have a 401K, but few of them have been with the same company for more than say five years running. Most are not unionized. The past couple of years have been especially brutal because programmers are the ultimate just-in-time employee; you typically need a programmer with a specific skill set for no more than eighteen months - the life cycle of a typical product, and once that product is done, their skill sets may no longer be necessary.
So what you have is an interesting paradox. Most tend to have comparatively high salaries - $60K to $120K, perhaps as high a $150K for a systems architect or CTO, but typically have to purchase their own health care, set up their own savings plans, and often have to rent because the cost of buying and selling houses repeatedly to move from place to place every couple of years is exhorbitant. Moreover, the main wealth driving engine of the 1990s for tech - stock options - have long since disappeared, or have been scaled back so dramatically as to make them worthless.
BTW - on trade worker unions, consider where most of those trade unions are concentrated in - the construction industry, transportation and heavy manufacturing, not exactly the most dynamic of sectors at the moment. Many unions have significantly scaled back their recruiting operations as their pension funds have also taken major hits, and in many cases union membership is incumbent upon the regular payment of dues, something that becomes increasingly unfeasible for people on unemployment who are torn between paying for food for their families or paying their membership fees.
As to government workers - those that are retired or close to retired do have full pensions. Most government positions below GS 12 however are now filled by private bid contractors rather than being directly employed by the government, and I can assure you that most of those contractors likely have few if any real benefits. Above that, yes - though this is true of just about any upper management position, either in the public or private sector.
No - while the meltdown of pension plans will affect those heavily in their late 50s and older, for those of us who are younger, pension plans are at best a distant memory.
I don't think there can be any serious question about it. A very small percentage (let's say 0.05%) has bought control of the US govt and has declared war against the rest of us.
Great catch. But, for me at least, your link was broken. Here is the one I finally found:
http://www.alternet.org/economy/145667/the_economic_elite_have_engineered_an_extraordinary_coup,_threatening_the_very_existence_of_the_middle_class
Do not know how to shrink the monster... odd. Think I will leave the other just in case... disappearing links are old news...
http://www.alternet.org/story/145667/
We have a malignant narcissistic President and A Princeton idiot at the FED. Neither one has noticed the fact, that everyone but them and their buddies are dumping leverage and credit. Families are moving back together. 2's and 3's are renting instead of one. People are dumping credit and puling together. The FED and it's agencies are choking on worthless paper. The debt and the usury that Benny needs to fuel his precious inflation is sitting on his books. In the late thirties debt was looked upon as a weakness. That's coming back and so is affordable housing.
not a big fan of current admin (nor the last) or Ben...but do you really think they are the main source of this...point of post is our formerly pretty top of the heap lifestyle and big fat middle class has been taken down gradually but methodically over several decades, hope you could see the rot prior to 2009, but hey, if it takes a Dem prez you think as more arrogant than past few other prezs to bust you into reality, guess its okay.
you quote a 1995 article and then add one paragraph. junk
The article Leo is talking about was published February 15th 2010.
The first paragraph of the article contained the opening for Michael Lind's 1995 piece, published in Harpers, entitled: "To Have and Have Not".
http://www.hartford-hwp.com/archives/45/006.html
The rest of the article was original to David DeGraw. It was considerably longer than a paragraph...
how is this a 1995 article yet with references to recent years? and if it were would you think things had gotten better since then, especially with regard to income disparity? hmmm, would you?
What this article describes so well is the financial terrorism that is being perpatrated against Americans. I am truly so worried for our nation and the world.
These banksters are worse than Al Queda!!
Congressional “reform” plans for credit default swaps are full of loopholes, guaranteeing that another derivatives-fueled financial crisis awaits us. According to the Bank for International Settlements, credit default swaps with a face value of $36 trillion were outstanding in the second quarter of 2009, the most recent figures available.
Credit default swaps are “a way to increase the leverage in the system, and the people who were doing it knew that they were doing something on the edge of fraudulent,” said Martin Mayer, a guest scholar at the Brookings Institution and author of 37 books, many of them on banking. “They were not well-motivated.”
Mr. Mayer has been critical of credit default swaps almost since they arrived on the scene. In 1999, for example, he wrote an opinion piece for The Wall Street Journal entitled “The Dangers of Derivatives.”
“These ‘over the counter’ derivatives — created, sold and serviced behind closed doors by consenting adults who don’t tell anybody what they’re doing — are also a major source of the almost unlimited leverage that brought the world financial system to the brink of disaster last fall,” he wrote, referring to the market turmoil of 1998. “The derivatives dealers’ demands for liquidity far exceed what the markets can provide on difficult days, and may exceed the abilities of the central banks to maintain orderly conditions.”
Calling credit derivatives “the most dangerous instrument yet,” Mr. Mayer concluded in his article that neither banks nor bank examiners have any idea how to handle them. “The system is easily gamed, and it sacrifices the great strength of banks as financial intermediaries — their knowledge of their borrowers, and their incentive to police the status of the loan,” he wrote.
And when a bankster bets that their own bank is going to fail, throwing the bank clients money in the fire and buying CDS over the bank itself, the bankster wins and the clients of the bank loose. Oh and the taxpayers will come to the rescue of the clients, i.e. themselfs so they loose their money twice !
drudge just reported that an emergency supply of condoms has been sent for winter olympics,,
as a sup note... a supply of head condoms need to be sent to keynesians reporting on failed economic policy ,,, we have met the enemy and it is us ..
a pot calling the pan black
Well done, Leo, you are in good form today. Thanks for sharing your thoughts.
thought from a mangled mind lol
sure these things are happining .. but it is not failed capitalism ,, it is failure to have a clue ..
The giant sucking sound called trade imbalances....We just GAVE it to them.
They call it protectionism, I call it survival.
this not capitalism .. that is destroying the world,, unemployment poverty wars ,, it is the results of the keynesian economic policy ll based on lord keynes.. and poverty saint karl marxs
read reismans classic Capitalism ..
this is the economic policy of the fed , the politicians , the rule of law subjected to special interests .
to equate whats going on in the business world to failed capitalism is like a wolf dressed on sheeps clothing
and a educational system that does not know the difference from its ass or a hole in the ground
pushed forward by even those who have a hard time i would imagine of pouring pizz out of a shoe,
never having started a business , never having to meet payroll.. educated at the feet of the pavlovian bell and the grule bowl of slop
well it is and it isn't capitalism that is "destroying the world", but it is certainly not keynesian economic policy. to the latter first: the central tenet of keynes is that national governments should reduce debt/accumulate surpluses (tax more than spend) in times of plenty so that they can "lean against the wind" and increase debt/reduce surpluses (spend more than tax) in times of scarcity/famine. it is not run deficits in expansions to fund tax cuts for the rich and pet wars (to be inflammatory). deflationary depressions are characteristic of capitalism (as inflationary depressions are characteristic of socialism/communism). to avoid this truth is to misinform oneself. however our current straits are worsened by what has come to be called crony "capitalism" and could be called fascism if one were so inclined: the capture of the government by corporate interests and subsequent perversion of the free market (and persecution of the free person) by the police state.
of course its a mixture of keynesian economic policy and corporate fascism '
government has no place in economic policy,,
when one person shoves a gun in your face .. and thakes your bread ,, is a crime ,, when a herd of government policys takes the same bread ,, it is devine lol
as i said a brief review of austrian economics and reismans capitalism ,, is a blow by blow discription of the sorry state of intellectual understanding of even the basics of division of labor,, wealth ,, the hidden hand of adam smith ,
this is not the time or place to review in detail the sorry results of the keynesian system of poverty war, unemployment .
to many believe a little poison in the food is healthy loi
I hate to say this, but Alex Jones is actually starting to sound like the smartest guy in the room.
+200
The Ultimate Ponzi Scheme –
FDIC is Backing $5.3 Trillion through the Deposit Insurance Fund that now has a Balance of -$20.8 Billion. FDIC has Cash and Marketable Securities of $66 Billion. Is that Really Enough to Back Every Account for $250,000?
The FDIC is running the biggest confidence game in the country. The FDIC is now protecting through the Deposit Insurance Fund (DIF) some $5.3 trillion in deposits in banks across the country. All of this is secured by an insurance fund that is now in the negative by $20.8 billion. In the middle of this financial crisis we allowed the government to suddenly up the deposit insurance coverage from $100,000 to $250,000 which on face value seems fantastic. I mean every average American wants their money to be covered so upping it to $250,000 seems fantastic even though most middle class Americans have nothing close to that and are merely trying to pay their bills from one month to another. But what if people suddenly pulled their money out of banks similar to what occurred with IndyMac Bank in California? Think this can’t happen again? One of the too big to fail banks seems to think this might be coming down the pipeline. Some interesting information on Citigroup:
You know it is really, really bad out there when traders, market true believers, and real capitalists take a view of the "worker class". I agree fully with the point of this article. Those whom do the toil, make the widget should they not get more profit, than some idiot marketer, that cannot deliver the service?
That is my problem with the current "Corporate Structure". SOme stupid sales person that will make a deal with the devil to "get his numbers up for the promotion", cannot deliver the service. Take "Jiffy Lube" for example. Should the technician get more money than the sales and marketing guys? I understand those that "risk venture capital", but as a deliver of technical services and capabilities, it always peeved me off when the sales guy got a comission on selling "me", and my ability to deliver the service. Without the worker bees that make the "stuff" there is no "stuff to sell".
Our nation allowing unfettered illegal immigration is what allowed houses and malls to be built ever cheaper, however, all that is happening is the destruction of the construction workers pay scale. I would not mind being a bricklayer if I got those wages in the early to late 1990s, but to carry bricks around and do all that for less than $10 an hour???? However every person that was a financial guy was touting the illegal immigrant as a savior to the capitalist system. Now they are here, not working, and taking up benefits and jobs from citizens and legal entrants and residents.
The CEOs IMO, need to be lined up in ditches, and not to dig. Most CEOs of the large companies, just as the financial banksters put themselves above all others, and they really do not produce anything of value. They are the architects to destruction and ruin.
LONG GONE are the "Captians of Industry", in their place are CEOs and corporate mangers that are little more than outright con men and used car salesmen. Most have ethical problems greater than those that are in elected office.
The Congress and the elitist CEOs and Corporate managers did far more damage to the American Citizen than Al Quaida could ever do. I believe that America will rise again, but there is a lot of pain, payback, and debts to pay by those that engineered this mess.
That ditch is going to get pretty full, and it will be lined with the Blankfiends of the world. Someone should have told people like him that if he is going to "Do God's Work" it usually eands rather badly for those that did. Joan of Arc, Paul, Mark, Peter,Bartholomew, the Huguenots.......
One can only hope.
Very well said-- Nice post
the world I grew up in, a white working class, Archie bunker type neighborhood in late 70s, the white people were sort of "classless" in that the workers made good union wages, got overtime, triple time on Holidays etc..while management didn't make much different, were salaried so no extras...in my neighborhood were janitors, PhD's in chemistry running a lab at 3M, a guy that ran machines at a peanut plant, other line workers at Whirpool, sheet-rock construction guys, teachers, all in similar houses...there were a few high-end lawyers and traders in some outlying fancy suburbs, but on our in-city neighborhood was solid, desirable, stable with nice houses and schools and everyone did reasonably well (at least white males), it was just that the guys with education did not have to sweat as much...now most of the worker class is illegal immigrants working for way less than my neighbors got for those jobs, and the high end management at 3M do sooo much better than regular worker...
The economically mixed neighborhoods of your youth and their demise is one of the central themes of the book "The Bell Curve". Too bad the rest of the book got mixed up with race and intelligence; more people would have payed attention if they were not distracted.
"The Economic Elite Have Engineered an Extraordinary Coup, Threatening the Very Existence of the Middle Class:"
Engineered? perhaps, certainly Bob Chapman and Alex Jones would agree with that thesis. But it may in fact have more to do with the closing paragraph and the self destructive nature of capitalism: the marketeer who sources a cheaper component from a location with low cost labor; the CFO who outsources back office activities to Poland; the consumer who purchases their patio set from Walmart because of its price; the teen who covets NIKEs made in a Malaysian sweatshop; the expat Canadian whose domicile is in Panama to circumvent taxes; the bankster who spends more on faucetry than most people earn in a lifetime etc.
Perhaps a grand conspiracy engineered by the elite but more likely a logical conclusion to the capitalist experiment.
Engineered ? Absolutely.
In your rant against capitalism, you conveniently fail to mention the various payoffs & bailouts that had to occur to get us where we're at. This ain't capitalism, comrade.
In a capitalist system, insolvent businesses fail. The logical conclusion you should be making is the grand Keynesian experiment has failed. Well,it's failed the middle class anyway, but was a wild success at wealth redistribution to the wealthy (as per design).
FAIL
Insolvent businesses fail. And? The debt (and what is represented and this not in monetary terms, who cares about money?) magically disappears?
Calling for a Jubilee or something?
A business fails. The assets are to be sold off to pay off creditors. Someone with a better idea comes in & buys the assets at a huge discount. Creditors/investors lose money on the deal (the risk didn't pay off), but the cycle begins anew.
If the new business works, the new creditors/investors make profit/get rich. If not, they all fail.
Rinse, lather, repeat.
You see back in the day a bank could also LOSE money. This now defunct process used to be known as capitalism.
No wonder you posted as Anon. I'm kind of embarrassed for you.
Anon here again.
I’m one of these NWO guys AJ keeps harping on about. AJ’s such a conspiracy nut. Anyway, the number one problem with the world is currency. Really, currency should be the same everywhere and the cost would then be based on cost rather than currency conversion (and we all know how currencies can be manipulated lol.)
You and others here are misdirecting your anger towards the elitists I mean CEO's and CFO's, it's really about all these different currencies. What we really need is a uniform one world currency to fix all our problems.
Hmmm... Singing the praises of a one world currency. Any time I hear "blah blah blah to fix all our problems", I am immediately skeptical. Is that you Ben Bernanke ?
It is an interesting point you raise that a single currency would help eliminate volatility. Perhaps a common world currency might have some benefit in that regard... Of course you completely ignore the white elephant in the room. Would there be any perceived difference if Bernanke controlled a one world currency vs the the dollar (already the world reserve currency) ? Seems to me all this would do is serve to expedite the decline of the USA as a global superpower, since elimination of the dollar as reserve currency would probably be a boon for the developing economies of China & India. In that scenario, the USA probably becomes China's bitch.
Can someone please explain what the hell benefit a central bank provides for the people.
At the root of the world's financial trouble is a handful of bankers that control fiat currencies pretty much everywhere in the world... And since government doesn't have the political will to live within its means, taxpayers are forced to pay interest to the central bank on money printed to cover budget deficits... thus continually deepening the national debt.
http://www.zerohedge.com/article/its-official-congress-passes-debt-ceili...
I don't know what else can be done beside demanding reform of the fractional reserve banking system, & eliminating the central bank. The central bank serves no purpose for the betterment of society. They do very well for themselves I'm sure, at the cost of ever increasing inflation & taxes to all of society to meet an exponentially increasing debt burden . Why should the Fed be allowed to charge interest on money creation ? Why doesn't the US Treasury issue money as Lincoln did, as Kennedy planned to do, & as is authorized in the constitution ?. That would be a huge start at addressing our troubles. Perhaps we would still have a fiat currency, but at least we wouldn't have to pay interest to a goddam private bank to issue it. We need to cancel the Fed's charter.
Gold has been universally accepted for the payment of debt since man invented the concept of money & IMHO should once again be used to at least fractionally back the currency (in hopes this would eliminate deficit spending).
The central bank concept has either failed miserably at stabilizing markets (it's chartered task & alleged reason for its existence), or it has succeeded magnificently, depending on your interests.
The talleystick remains the longest lasting form of fiat currency in world history. This aligns with Bill Still, who advocates that it's not what backs a currency but who controls the quantity that's of utmost importance. Still presents a strong argument for the issue of US Treasury Note fiat. If not the US Note, perhaps we should issue the Talleystick ? It would be very difficult to counterfeit... So why not ?
Some exaggeration here, but the real point is that by condemning most Americans to worthless public schools, the elite has little competition. Robert Heinlein "ignorance is its own death penalty."
Leo - stop it, I am really liking your posts, which is hard for me to reconcile.
I'm with you in that I don't know if I totally agree with all the points of your reference pieces but its a GREAT alternative perspective.
The thing that is interesting is this is a perspective that both agrees and totally disagrees with typical partisan perspectives. Yes, as conservatives would say we are being totally bent over by govt and they govt is robbing our wealth via taxes and yes, as liberals would say, it is the wealthy elite conspiring to steal our common wealth...but unlike a Tea Party take, that main issue is not inefficient govt agency providing bloated social services so much so but rather our treasure being diverted to elite via crony corporations that provide little or no good to general population. As I have noted since Medicare Part D, the only reform our congress ever manages to pass to help people at all, always end up being hugely inefficient programs that enrich corporations, while technical helping some people, it comes at great price. I often think if we had an all lefty or all right/libertarian solution, we would be better off either way...(either we'd have fairly efficient gov solutions such as UK's all govt provided universal health care that costs less than half of what we pay to leave 30 million uncovered, or we'd have a cost efficient all private solution) but instead we have this taxes used for crony/corrupted govt programs that very inefficiently provide services and govt not protecting interests of average worker.
Brilliant! And not just because it's what I've been trying to say for a while.<p>The problem is, we in the US have a false dichotomy. If you put on the blindfold and earplugs, what really is the difference between the conservatives and liverals in American politics? The name on the front of the jerseys. The immediate short-term beneficiary. And that's about it. They both believe in the same overall power structure. They both work more or less for the same company. So no matter which version of the pro-corporate-insider, pro-war, pro-authoritarian party we elect, most of us do worse.
yes yes yes. your contrast of left/progressive right/libertarian solutions as each having likely real costs yet real benefits with the worst of both worlds "moderate"/crony capitalism/super inefficient policy we have is so so telling. bravo!
I am no expert here and so am running a little off the reservation. But I read that there are 3 things everyone wants in health care:
-- universal coverage
-- best care (high technology, nurses, etc.)
-- low cost
You CANNOT have all 3 of the above. You can pick 2, but it is logically impossible to have all 3. So, what does America want? Do we know? Do we know enough to care? *Sigh*
Your comments remind me of the project management triangle.
You can have it Good, Fast, Cheap.... but you only get 2 out of 3.
In your analysis perhaps the universal aspect could become the FAST part of the equation.
We could get GOOD care and a CHEAP cost, but the process would take time to get UNIVERSAL coverage. Or not. Adjust the equation until it works.
Just a thought.
Everyone does not want universal coverage. Competition in insurance coverage will work once the real cause of high healthcare costs is addressed:
Removing the need for a doctor to have 3 lawyers working constantly to fend off frivolous malpractice lawsuits and deal with the constant over-regulation coming out of DC.
Most important to this entire process is getting rid of the 2 most misunderstood pieces of healthcare:
1. Misconception: "Healthcare insurance should cover all aspects of health, down to the mundane minor costs." Insurance is designed for and works best (most cost-effective) when it deals with the larger issues and more chronic conditions. Demanding that some third-party pay for your annual checkup or occasional antibiotics is insane -- it drives paperwork (cost) up, increases complexity, and creates entitlement mentality.
2. Misconception: "Somebody else has to pay for my insurance." In the 1950s, when large corporations started offering insurance coverage to employees as a perk, it was a supplement; people still had to have their own coverage but this was a nice little extra. It started with life insurance and moved into the health arena. Before that, you paid for your own insurance (which usually covered pretty much the most catastrophic stuff only), and if you went to the doctor with a tummyache you paid out of your own pocket. Paperwork was streamlined, costs were roped in, people had a good balanced sense of what their own responsibility to their own health really is.
MAIN SOLUTION: Educating the people on the proper balance of insurance coverage versus their day-to-day healthcare costs. This concept that some 3rd party has to pay for every aspect is a maleducation and manipulation of the average consumer and is leading directly to overarching governmental expansion into yet another arena. Get rid of the entitlement mentality and then we can actually have a real debate on this --- any other solution without resolving this will lead directly to Obamacare in one form or another.
SYSTEMIC SOLUTION: Institute tort reform, install a loser-pays system of litigation, and create a tax break on healthcare premiums similar to the mortgage interest tax break. Secondarily, allow doctors to decide whether or not they wish to take Medicare/Medicaid/state-covered patients -- if it's not cost-effective to treat someone, no doctor should be required to do so.
Costs will drop, doctors will be available, insurance companies will have need to compete more, and consumers will have choices.
Getting the litigants out of the picture and the government off the doctors' backs will solve a myriad of the issues we are facing now, and it won't involve the Government Nanny pressing us all to her teat.
Those left-wing socialists over at the Washington Post would beg to differ:
http://www.washingtonpost.com/wp-dyn/content/article/2009/10/09/AR200910...
Money shot at the bottom of the article: "A package of reforms that included a $250,000 cap on damages for pain and suffering and a $500,000 cap on punitive damages "would reduce total national health care spending by about 0.5 percent."
Please note that this 0.5% savings is projected over the next 10 years.
As an MD, I can tell you your conclusions are not valid. there are a number of health systems that do work fairly well. Mainly it has to do with the structure of the system. it isn't hard to fix in fact, but it would mean much less corporate profits. Therefore industry fights it all the way. Pharma, insurance, medical devices. Because of this system we pay a log increase in prices for minimial return of increase in quality of care. In some instances the government actually prevents outcome studies being performed on a cost benefit basis for individual drugs.
Hospital management is 30 years behind in techniques and isn't professional at all. those who want to fix the system are considered disruptive and removed from the system because those in power got there by a flawed system.