The Pentagong Show

The Pentagong Show
United State of Terror: Is Drone War Fair?

Thursday, November 13, 2008

Yes, there is a "They"...they are The Rich, and they own you.

In 1910, as quoted in The New York Review of Books, the ostentatiously arrogant Aristocrat, Frederick Townsend Martin, dangerously pleased with his own excellence, claimed,

"It matters not one iota what political party is in power or what President holds the reins of office.

We are not politicians or pubic thinkers; we are the rich; we own America; we got it, God knows how, but we intend to keep it if we can by throwing all the tremendous weight of our support, our influence, our money, our political connections, our purchased senators, our hungry congressmen, our public-speaking demagogues into the scale against any legislature, any political platform, any presidential campaign that threatens the integrity of our estate."

Of all the things that changed during the 20'th Century, that attitude is not one of them. The idle rich will destroy the very basis of their own ascendancy before ceding one iota of what they consider theirs. That is why we have revolutions and the carnage of World Wars, two of which have apparently changed nothing.

A case in point is made by the Centre for Economic Policy Research's paper on the Iceland financial debacle (apparently one's frowned on for using the more descriptive, alarming, "Crash": mustn't alarm the peasants), as published in their Policy insight newsletter # 26:

Even if the banks are fundamentally solvent (in the sense that its assets, if held to maturity, would be sufficient to cover its obligations), such a small country -small currency- configuration makes it highly unlikely that the central bank can act as an effective foreign currency lender of last resort/market maker of last resort. Without a credit foreign currency lender of last resort and market maker of last resort, there is always an equilibrium in which a run brings down a solvent system
through a funding liquidity and market liquidity crisis. The only way for a small country like Iceland to have a large internationally active banking sector that is immune to the risk of insolvency triggered by illiquidity caused by either traditional or modern bank runs, is for Iceland to join the EU and become a full member of the euro area. If Iceland had a global reserve currency as its national currency, and with the full liquidity facilities of the Euro system at its disposal, no Icelandic bank could be brought down by illiquidity alone. If Iceland was unwilling to take that step, it should not have grown a massive on-shore internationally exposed banking sector.

That last sentence is the kicker. The Rich knew this quite well. But in keeping with the Reaganite/Thatcherism creed of "Who cares? We're the Rich; we'll do whatever it takes to make us richer." That is, after all, the obvious, if you had been paying attention, Capitalist's Creed...or screed, if you prefer. If an entire country is destroyed by their machinations, they don't care, it's simply Friedmanitemare collateral damage; they don't suffer, they just take the money and run to the next economy that's doing well, and then work to enrich themselves whilst bringing that one to its knees ...  Next.

Why is this news?

John Kenneth Galbraith wrote, in his "Short History of Financial Euphoria" (dysphoria, more like), that "Recurrent speculative insanity and the associated financial deprivation and larger devastation are inherent in the system". This is a fact well-known by Wall St. financiers who use the knowledge to separate, not only fools, but quite a lot of other people, from their money in a heady daze of speculative euphoria ... that's their job. Not to make sure that your 401, or Calpers, or DB (defined benefit) pension fund, or State-insured (by failed institutions such as AIG) pension fund, assures you of a secure retired future.

Why is it news that their allegiance is to the rich? Why are we shocked when we see, decade after decade (1987, 1997, 2007.... what do we need.... a 2x4 to the head?), they skim off the profits accumulated by a shrinking middle-class to stuff their pockets with and fund another bubble in another country, impoverishing them in turn before they turn to the next victim?

Realize this: You have no pension ... all that you've saved all your life is not yours ... it's theirs:

"....we got it, God knows how, but we intend to keep it".
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