The Pentagong Show

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

Wednesday, July 30, 2014

The Mass Poverty Bubble.


 Risk of even a hardScrabble existence is in Jeopardy from Monopoly.

In fine alignment with my blog's name, which should have as its corollary, "ECB's War against the Euro" or "Japan's War against the Yen", which would also include "London's War against the Pound", (or "England eats the German Diet"?), reminds me of the quote I posted waaayyy long ago, in a post entitled, "They are the rich and they own you ", I cited that, 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, one of those things being, as you can see, America.

I was reminded of this while reading Galbraith's "The Nature of Mass Poverty", which reads as if it were written by someone from another  planet, as instead of working mightily to deliver Mass Poverty to the citizens of the world, as does the current Aristo-class, it was meant as a treatise on how to alleviate the world from its privations. Can you imagine? The very class that's the first to scream "Class Warfare" while they simultaneously wage a decades-long War on The Poor (There is no such thing as a "War on Poverty", a "War on Drugs", or a "War on Terrorism", these are all nonsensical phrases that belong more in "Alice in Wonderland" than in the real world of resource constraint and "Special" interests, although exactly why some interests are special, while yours are irrelevant is never questioned, even by you. There is only the War on the Poor, The War on People who use Drugs, and the War on Terrorists), have no scruples about waging one themselves. They know this, but luckily, the public is so easily duped, they can take everything away by merely throwing a few slogans around or wearing a flag in their lapels, or draping an enormous flag the size of Rhode Island across the Colonnaded facade of that Temple of Terror, that drips with the blood from the profits of War-mongering, the nasty NYSE (which sounds remarkably similar to Nazi), and then, at the slightest whimper from those whose future they've stolen, scream "Class Warfare!", and we, like the wimps we've become, simply cower and slink away in shame at our unforgivable effrontery.

But back in the fifties, fresh from the carnage into which it unabashedly hurled its citizenry, the Upper classes weren't quite as uppity as they had been, and so economists could dream of such idealistic endeavors as breaking the age-old hold of mass poverty in, of all places, India, by a large and costly program of assistance to Indian agriculture. Not American Indians, mind you. They were under attack as the BIA attempted to dismantle their tribes, abrogate their treaties, and culturally assimilate them into the US by depriving them of the reservations they lived on, so why would they be concerned about American Indian Agriculture? (this was before they were referred to as Native Americans, a nomenclature just as dismissive as America is also a name derived from the Europeans' Grotius-enabled presumption of the "New World" as a land that was "Discovered"). 

What Grotius did was devise a legal framework by which a country could lay claim to a previously undiscovered land (by a European), and divvied up these discoveries, the natives living there getting scant, if any, recognition, except to be used as slave labor. Today, being more civilized, we simply claim the resources as ours, having appointed someone amenable to our interests as their ruler and then paying some token amount to them, leaving the problem of dealing with the populace of a now-ransacked landscape to them.

Galbraith's supposition, which he expostulates on and explicates in this thoughtful little treatise, is that the land can support only so many, and once that number is exceeded, the problem of poverty for those living off the land's productivity, becomes intractable. They must therefore leave in order to give any hope of a less destitute life to those remaining. This he refers to as breaking the "Equilibrium of poverty", whereby those who don't wish to be accomodative of their lives of hopeless penury, thereby becoming resigned to their fate, are given the option of emigrating to another, more prosperous place, where they supply the cheap labor necessary to allow small businesses to be started and thrive.


Recently in both China and India, this has been happening within the country itself with the same dynamic occurring, but between the countryside and the City, such that the population of cities are burgeoning, even as the rural lands from which their populations came become despoiled by pollution, or built over for some industry or other to  build trinkets for foreigners. Substituting burning hydrocarbons for burning carbohydrates as an energy source, for agriculture and industry leaves it easier in times of economic downturns to simply turn the machines off, as opposed to carbohydrate-burning energy sources who need food, air and water at the most inconvenient of times: during an economic depression.


But when hydrocarbons become too expensive, the carbohydrate-burning entities that drive the machines that burn those hydrocarbons, in modern civilizations such as the OECD counties, still have to burn them as they slow the process of burning them for industrial production, but simply to get from point a to point b, of even more importantly, to watch TV. This, from an economic standpoint, means that as evidenced by ZIRP, the difference between what an enterprise can charge for its products or services and the cost to provide those products and services not only gets smaller and smaller, but,as in the case of the entire fracking industry, it actually goes negative, resulting in the equation turning upside down, and just as Capitalists did to colonies, it now does to itself, such that it gets more and more impoverished the more it produces.

What ZIRP is telling you, especially as it not only is not enough to get the economy anywhere near "escape velocity" to drag it out of its interminable stagnation, but according to any understanding of the underpinnings of Capitalism, is that industry is unable, and therefore unwilling, to pay for the risks of its own undertakings and must, like many other of its other expenses, cogently referred to as externalities, push those risks and their attendant costs onto the government, ie, the citizens, who, although they may derive benefit from the products of industrial civilization, such as their I-pads, HDTV's and automobiles, get no dividend on the risk that they are, albeit unbeknownst to them, incurring and forced to pay for when an enterprise fails, yet receive none of the dividends, regardless of how spectacularly it may succeed, those going instead to those who were paid by the government, via ZIRP, the GSE's, or other vehicles used to disguise the non-Capitalist nature of the evolving economy, to assume the onus of devising the company's business plan or even actually running it.

You can tell that this is the case by the extractive mentality of CEO's in this Brave New World, wherein their faith in the future of their enterprise is so shaky that they take everything out of it that they can and move on to the next ailing venture to rid it in turn of all of its carbohydrate-burning elements in favor of their own bank accounts.

The reason for this incapacity to pay for its own expenses is that the loans made for the business plans formed and the collateralized assets pledged, from which is derived the interest rate charged, were all calculated using inputs that have now changed. This is what in the late eighties and early nineties was referred to ad nauseum as a paradigm shift.  Yet now, in the 21'st century when the price of energy, as represented by oil, has increased by a factor of ten, which is a paradigm shift of tectonic proportions, one never hears the phrase at all. Which means, there is simply denial that anything fundamental has changed. But, as Galbraith asserts in is little booklet, "The most commonly offered explanation of poverty and well-being invoked the nature of government and the economic system. The economic system as a cause of poverty is invariably cited with passion".

 Yet, as can be seen by his next statement: "The people are poor because they have not received the advantages of free enterprise, free competition and the market. Their energies are therefore frustrated by a stupid and costly bureaucracy", he is not referring to the OECD economies but to what then referred to as the third world economies. So what is the solution to a country's mass poverty (45 million people on foodstamps out of a population of 300 million people is, by any definition, mass poverty) when it is free enterprise, free competition and the market that are causing it?

So far the answer to that question is, "Why by cannibalizing the assets built up over the period when the economy was functioning via mortgage schemes, financial shenanigans, Imperial bluster, and monetary hegemony", all while pretending that these subterfuges were only necessary temporarily until we could "rightsize", or increase exports, or frack our way to energy independence. But all of these so-called solutions are mere chimera. Because it is not only Capitalism in the US that is on its back, but worldwide. After a brief spurt in which a chosen minority of a population has gotten spectacularly richer, and a larger swath has become ostentatiously, usually by taking on unwise amounts of debt, better off, the result, country after country, has been to revert to the mass penury it came from , only this time, everyone now being urbanized, without the ability to eke out a painful, but adequate, sustenance by working the soil and coaxing some wherewithal therefrom. 

 Thus does the answer remain the same as it did when Galbraith published his book in 1979, it is the economic system itself that is the cause of poverty. But because we are in love with the economic system, or at least the idea of it, and the dogmatic faith-based insistence that only Capitalism is acceptable, no matter the fact that it keeps entire populations in grinding penury, and delivers, nor has it ever intended nor claimed to deliver otherwise, the fruits of Labor not to those who work, it was only the now-defunct unions that insisted the balance sheet include Labor, but to those who own the workers, we can expect nothing more from it. This is the course the 21'st century is offering up to us, the new normal of increasing and inescapable mass poverty with those in the ranks of the haves and have mores retaining the status quo via ever larger expenditures on arms, police, prisons, bombs, tear gas, surveillance, and drones, while sequestered in gated communities relying on governments they continually decry, for having the audacity to exist, to provide their security. We, the US, the national entity that has proclaimed itself the exceptional nation that shines out as the "End of History" has provided this example to the rest of the world. Capitalism works. Because Capitalism alone can produce that which is needed for a peaceful co-existence: Force Force and even more Force. So may that Force be with you, because God help you when it's turned against you.













Monday, July 28, 2014

Des Esseintes Redux.


Escher Sketch



It is true that the discussion of corruption and its ramification on the polity has my entire approval, yet my mind revolts against the vague remedy of hope in a future life offered by the religionists as they tear apart every scheme that promises to deliver a better one to those still living. Schopenhauer comes nearer to the truth. He too took his stand on the iniquity and rottenness of the world; he too cried out in anguish that "Verily it is a pitiful thing to live on earth!", preaching the nullity of existence, the advantage of solitude, and warned humanity that whatever it did, whichever way it turned, it would always remain unhappy - the poor because of the sufferings born of privation, the rich because of the unconquerable boredom engendered by abundance. The difference between them being that Schopenhauer offered no panacea, beguiled you with no promises of a cure for your inevitable ills.

He did not drum into your childhood ears the revolting dogma of original sin; he did not try to convince you of the superlative goodness of god who protects the wicked, helps the foolish, crushes the young, brutalizes the old, and chastises the innocent; he did not extol the benefits of a Providence which has invented the useless, unjust, incomprehensible, and inept abomination that is physical pain.  Instead he exclaims in his compassionate indignation that, "If a god has made this world , I should hate to be that god, for the misery of the world would break my heart." (As if a Divine Being would have need of one).

As the great unwind proceeds it seems less wise of the Left to pretend that the remnants of a tattered philosophy of progress can be stitched together into anything but a veil of tears behind which to hide society as it really is, filled with pitfalls and disillusionment in which you are to consider yourself lucky if you are not constantly visited by some unforeseen calamity: a mysterious maze through which one must pluck one's way via unlikely bypaths best navigated with an attitude of resignation and drift.

However, this resignation is frankly based on the recognition of a deplorable state of affairs and the impossibility of effecting any change, and hence is a difficult attainment for the poor, whose lives reflect the sorry state of affairs on a daily basis, and so who are more easily appeased by the kindly voice of atavistic religion promising them rewards for their privations and punishment for the wealthy's greedy self-absorption.

So it seemed helpful to cultivate what was already an excessive fondness of flowers into a passion, since, to stave off the victory of enervating pessimism, everyone must be passionate about something in the 21'st century, as it is, apparently, as anyone interviewing for a job these days knows, only while in this state of emotionally heightened excitability that one's statements are taken to have any veracity, profundity, or, indeed, relevance.

This floral affection began with the embrasure of all flowers without distinction of species or genus, only slowly becoming more discriminating, even to the point of limiting oneself to a single caste, that one being, more usually, as most often it is the well-heeled who are able to maintain the delicate balance of environmentally staid and nutriment-rich atmosphere necessary, orchids.

Because it becomes inevitable that Corporate hothouse-grown varieties from insecticide-drenched milieus will lead to the common everyday varieties being despised, as they are seen in sidewalk vendors' stalls and supermarket aisles, in wet flowerpots and under green awnings or red umbrellas.

Just as one's literary tastes and artistic preferences become more refined, recognizing only such works that have been sifted and distilled by subtle and tormented minds, and at the same time instilling such a strong distaste for accepted ideas that it hardens into disgust, the love of Flowers will rid itself of its residuum, its lees and become clarified, c'est a dire, and purified.

Thus will a flower store be transformed into a horticulturist's shop in which a microcosm of the plant world includes representatives of every social category and class - poor, vulgar slum-flowers, the geranium, for instance, that are really at home only on the window-sill of a garret or the metal staircase of a fire-escape, with their roots squeezed into coffee-cans or snaking through cracked earthenware pots; then pretentious, conventional, stupid flowers such as the rose, whose proper place is in pots concealed inside porcelain vases painted in stifling Asian sweatshops by dirt-poor peasant girls lured into city slums from their rural degradation with visions of lipstick and high heels, but ending up in urban blight and factory enslavement; and lastly, flowers of charm and tremulous delicacy, exotic flowers exiled to Suburbia where they are kept warm in palaces of glass, princesses of the vegetable kingdom, living aloof and apart, having nothing whatever in common with  popular plants or bourgeois blooms.

Now, whereas one can't help but feel a certain interest, if not affinity bordering on pity, for the lower-caste flowers, wilting, as they do, in the slums under the foul breath of sewers and sinks, it is equally difficult not to loath those that sit like ceramics in cream-and-gold sitting rooms that nobody sits in in the  McMansions of the nouveau-riche, so that admiration is instead reserved for the rare and aristocratic plants from distant lands, kept alive with cunning attention in artificial tropics created by carefully regulated central heating controlled by a Gestapo-like monitoring of thermostats.

Unlike days of yore, when the taster for the artificial and the rigors of east coast winters left living plants' survival tenuous and therefore led to a neglect of real flowers in favor of its copy, faithfully, and seemingly miraculously, executed in india rubber and wire, calico and taffeta, paper and velvet, plastic and hot glue. This resulted in a wonderful collection of plants, fashioned by the hands of true artists, following Nature step by step, repeating her processes, taking the flower from its birth, leading to its maturity, imitating it even to its death, noting the most indefinable nuances, the most fleeting aspects of its awakening or its sleep, observing the pose of its petals, blown back by the wind or crumpled by the rain, sprinkling its corolla with dewdrops of gum, and adapting its appearance to the time of year - in full bloom when branches are bent under the  weight of sap, or with a shriveled cupula and a withered stem when petals are dropping off and leaves are falling.

This astute artistry has long held sway, but now my dreams are turned to collecting another kid of flora: tired of artificial flowers aping real ones, it became essential to discover, living as I do, in the land predominated by the Calla Lily, natural flowers that look like fakes. A foyer filled with plants that look as if cloth, paper, porcelain, and metal have been lent to Nature to enable her to create unnatural monstrosities all intermingling but breathing not a scent of perfume, but, as if copying the membranes of animals' organs, borrow the tints of their rotting flesh and the hideous splendors of their gangrened limbs.

Thus are horticulturalists proven to be the only true artists left to us these days, and the collecting of their oeuvres, the ultimate collectors' guilding the lily, the beginning of a gallery where you can see more of the hanging garden and the genesis of my own, watering-can free, Literal Shop of Horrors.





















Thursday, July 24, 2014

Ma Chère Tante, Bonne Nuit, Bon Voyage, Au Revoir.


Good night, good journey, good-bye.


My Aunt Ann kept here eyes riveted on her last surviving sister, breathing with her breath, echoing her faint sighs, the last thread that held her to life, counting them with dread lest one of them should prove her last. Like an angel at the gates she was at once eager and calm, strong and prostrate.

In the chapel down the hall the Angelus rang out; the waves of humid hospital air brought up the sound in gusts, announcing that at this hour all Christendom was repeating the words spoken by the angel to the woman who made reparations for the sins of her sex. This evening the Ave Maria came to us as a greeting from heaven. The prophecy was so sure, the event so near, that we melted into tears.

The murmurous sounds of the evening - a melodious breeze in the leaves, that last twitter of the birds, the buzz and hum of insects, the voice of waters rippling in the foyer's fountain mixing with the plaintive sobs of her loving daughter - made it sound as though all the land was taking leave of the loveliest Lily of this valley and her ribald, fun-loving humor. The religious poetry of the scene, added to all this natural poetry, so well expressed a chant of departure that our sobs began anew.

The doctor, standing by the bed, as calm as science, holding his patient's torpid hand, had signed to the priest that this sleep was the last hour of the ease in which she was sliding into death. The moment had come for administering the last sacraments of the Church she had loved so dearly.

At nine she lurched awake and looked at us in mild surprise, whether at us being there, or at her still being alive, we will never know. All she said as she smiled, was, "I shall live - but in you".

"I can die without a bitter pang if I may hear from your lips one loving word for your old aunt Shirl, saying you will forgive all that I have said to you in bitter anger, finally understanding that it was for your mother's pain I lashed out at the source of her affliction who seemed, and, I still believe, was, so mindless of his actions' effects on a loving mother's heart."

"Isn't it rather I that has forgiveness to ask?", I tearfully beseeched her, as I grasped her soft and gentle hand, "Have I not been harsh, magnified by a teen's judgmental scruples?"

"Perhaps," she replied. "But that was long ago, so be tender, my dear, to the weakness of the dying; soothe my soul with your forgiveness. Then when you are in the hour of death, you will remember that I blessed you as we parted."

The priest put his finger to his lips, at which hint the dying woman bowed her head; weakness was too much for her; she waved her hands to express that the priest was now superfluous, and begged pardon of her children, for being sometimes too rough with them, and confessed that during the past few months of her illness, she had uttered complaints, little worthy of a Christian, which might have shocked her offspring, to whom she felt she had been cold, and had at times given voice to unseemly sentiments; but she ascribed to her intolerable sufferings this want of submission to the will of God, and then acknowledged, as those leaving this life often do, the vanity of all earthly endeavors.

When she closed her eyes, we all began to pray, and within a very few moments her breathing became difficult, her body agitated, and when she opened them again, she gave me a last look, filled with sorrow, as a cloud dimmed her eyes, perhaps from hearing our sobs, and she breathed her last sigh - the last pang of a life that was oftentimes one long pain, bravely hidden by wisecracks and highballs.

This is just the latest of my personal experiences of death, but it as though I had been struck by a blow, and I sat with eyes closed yet still seeing the still expression given by the stilling of every tempest. The pallor of her face reminding me that it would never again reflect with its numberless affections and warm smiles, the love and joy it elicited from mine.

What majesty there is in that silence and coldness! How many reflections do they utter! What beauty in that perfect repose and what command in that motionless sleep! All the past is there and the future, devoid of her, has begun. I loved her as well in death as I had in life. And so, when alone, unseen, I kissed her brow with all the love she would have never allowed me to express when she lived, and said good night, good journey, good-bye.
















Monday, July 21, 2014

Capitalism = Creative Destruction, so Why all the Hypocritical Angst?

Robocorps of Robocops grow crops of corpses.



While reading Tom Engelhardt's article from Tom Dispatch posted on Naked Capitalism's site, it was, perhaps because I worked in the IT field (before it was referred to as such) for so many years, including during the time when DarpaNet was being developed and the beginning foundation of the NSA's Constant Surveillance state were being laid), surprising to me that, pre-9/11, people with the intelligence of Mr. Engelhardt's caliber were so naive about what the Internet that sprang from the outsize budgets of the Pentagon and the Industrial complex that it showered enormous Capital funding on, was actually designed to do.

Tom represents to me the Liberals' dream of the past, those who advocate outsize paychecks for the swelling numbers of the population, not because that will bring them better health, education, and wellfare (sic), via cleaner water and fresh air and all the other amenities of life once taken for granted and then despoiled and undervalued by an industrial machine gone mad, but instead to feed a voracious and insatiable, and consequently, unquenchable, appetite for a purely materialistic, self-aggrandizing "lifestyle", so as to become more like that pariah of humanity: The Rich and Shameless.

Raising the paychecks of a populace that is mightily striving to put food on the table, feed and educate their young, and provide some kind of decent retirement for their elders is a a completely different situation than stoking a well-fed population's dreams of becoming just like the Rich and useless, by advocating their purchase of larger and larger automobiles and SUV's, and "Dream" homes that looks like a nightmare, financing their current home's redecoration with granite kitchen counters with stone shipped form a continent away and adding extra rooms even as their children move out of the ones they'd grown up in, and doing it all by taking out HELOC's that jeopardized their own retirement, all based on the paradigm of using cheap labor and energy extracted from foreign soil which, in one case, was a Communist Party-ruled Totalitarian Regime that had shot down, in a Public Square in view of the world, those of its citizens who dared to question their unassailable power, is not even close to what I had imagined what was meant by the term "The American Dream".

That's because, I imagine, being from New England, my American Dream ran more along the lines of those depicted in Van Wyck Brooks', "The Flowering of New England", in which he describes,  "John Pickering, who had learned Arabic in his youth, and had mastered twenty other tongues, and was at work on a philological project for the spelling of the American Indian tongues that was to lead to a world-wide movement for the study of all the primitive languages", because, like Bancroft, of whom Humboldt wrote to a friend, I too, believed that ,"the true happiness of man consists in the culture of the intelligence." By which I most certainly do not mean cookie-cutter degree mills that leave the intelligence to lie fallow as they indoctrinate their students with cant while burdening them down with an intractable decades'-worth of debt.

But because we reject such 'boring' incentivizations, we end up with a population mesmerized by such mind-numbing blather as "New Jersey Housewives", totally ignoring "The New Jersey Governors":

Christina Todd Whitman, who, as head of the EPA, warned that, "The Kyoto Protocol would put millions out of work and have a negligible effect", and instead supported Bush regime policies that put millions out of work and had a disastrous effect;

Corzine, who used his influence and business ties made while governor to run a hedge fund into the ground, but not before rifling through all his clients' accounts to try and make up for his disastrous bad bets,

And of course, Chris Christie, following the same arrogant path, using infuence pedaling and backroom bluster to punish his opposition and using federal disaster relief funds to reward supporters.

All made possible because all we care about anymore are the physical rewards of materialism which can never be enough. A dynamic that was purposely stoked by the Reagan-era dismantling and jettisoning of Employer-based pension plans, because such plans can only be run by an employer, since, unlike a 401K or IRA, they aren't so much pension plans as they are annuity plans. The companies in question didn't have to save for a possibility of an employee's longevity, they simply had to insure against it, such that the longer a generation of employees lived, the higher the Company's premiums would go.

You, however, since you need the funds to spend, can never save what you may need, especially as you might die before ever needing it or live to be 98, when it would be quite gone. Now, who, may I ask, since no one else seems to have, can one, in a 40 year span, plan for a retirement, the difference of which, can be a 30-year span? Try to imagine the kind of returns you'd need to get in order to assure that you can have investments that pay as much as an entire life of work for another life of non-work. And all this while the investment community doesn't just hire people like Corzine, but actively courts them, as they end up, as a whole, far richer with folks like him, whereas the investors with their life's savings entrusted to these self-described sharks, must constantly navigate theses hazardous shoals, because, among other reasons, the so-called "Independent" Fed ruthlessly pushes you out further and further along the plank of Risk until you're pushed over and sink underwater where no amount of "mopping up" operations can save you from drowning.

And all of this because we believe that Capitalism is some God-given economic system and that Communism, which is by any definition, merely another form of Capitalism, is devil incarnate. Neither is true, and we should by now grow up and realize not only that, but that the entire profession, it is not a science, of economics, is, just as all psychology, on some level is all behavioral psychology (why else would we care about it), all political economics. We are not in a Skinnerian Walden II, where we can make up situations of positive reinforcement and rewards-based behavioral manipulation, but in the actual world of families and selfishness and GSE's and the Fed and other institutions that are subject to capture by small groups of elites who either believe that people don't know what's in their best interest, or if they do, that whatever that may be is most decidedly not in that elite group's best interest.

But since rampant Capitalism is, as self-described, rabid Creative Destruction, what is created leaves no plan B, because it destroys everything that gets in its way in order to forge the new. There is only oneway left to go, and that is forward, to whatever the mass myopia has concocted this time, and the devil take the hindmost. In standing testament to this fact lies Iraq, that civilization that was utterly "bombed into the stone age" as the Bush Regime so proudly announced, and their subsequent embrace, since all else was ground into dust, of an ancient Islam rife with barbaric practices from that same stone age, where murderers are martyrs and women are chattel.

So, since Tom insists that none of us can see the future, its fog being denser even than that of war, Capitalism and its lack of ability to self-correct, now that all competing versions have all  been steamrolled over by "The Washington Nonsensus", has entered into its phase of intractable stagnation. This, since it is the current, and not the future state of affairs, is rife for comment, because the intrinsic problems of capitalism - instability, entrenched and rising inequality, a lumpen proletariat - are still there; only now we aren't even trying to solve them, and they are now joined by a new set of problems that flow from capitalism's growing dependence upon non-human capital and the machine-made brainpower industries that need more and more energy to run them even as less and less of it is readily available. Coupled with that is the fact that electron-dependent technology makes skills and knowledge the only source of sustainable strategic advantage, yet they change so rapidly that their accumulation becomes an impediment to their refurbishment. I know all you would never need or want to know about the 256 subchannels on an IBM Channel-attached OEM-FEP, including their timing sequences and handshake protocols, which is a fraction of what some of my more acute and industrious colleagues knew, and yet, it is of absolutely zero value to any prospective employer.

So even as the society that is being built around us requires of us the maximization of individual consumption abetted by an ever-changing electronic landscape requiring ever greater investment in never-ending upgrades and ever-increasing costs for security from pirating, theft and collusion among ISP's, software, firmware and hardware companies, while on-line 'stores' destroy off-line shops, it has shown no ability or willingness to make any long-term investments in the skills, education, knowledge or infrastructure of the landscape around it, and is determined, as Apple so recently demonstrated with their tax payment of 0, da nada, nil, to make sure that governments haven't the revenue base to do so either.

So, whereas Tom may be right, in that we can't tell the future, one thing we can tell, is that, as we can see from the robotification of war via drones, networked warfare, robotized manufacture, and mindless destruction of all the natural systems needed to sustain life, extending even as far as the acidification of such all-encompassing systems as the oceans and the poisoning of the atmosphere, that that future is being planned, (some future is always being planned somewhere by someone), but does not have you or yours, or even mankind, in mind.

This may be the first time in our history that what we are creating in our rampage of destruction has nothing whatsoever to do with the betterment of our chances or a better life for the future, but instead willfully destroys our chances of even survival in favor of the betterment of the machines' chances. We cannot foresee who will win this war, but the (I keep going to say "our" machines ... but they aren't, are they?) machines' capacity for destruction is rapidly eclipsing even ours, such that the one that ushered in the machine age, and is the basis of so much middle-class yearning and earning, the automobile, is actually, from a technical standpoint, a weapon of mass-destruction. So let the betting begin! As the short sellers, with Goldman Sachs leading the way, said anticipating the financial meltdown that "No one could have foreseen":

 "There's a way you can make money from this."











Thursday, July 17, 2014

We are but Fortune's Fools ...

I've had better daze.

Yesterday I picked up reading David Crist's "Twilight War with Iran", where I had left off a week or so ago, as another coupla books needed to be finished before they were due (well, overdue really) and went as far as the Chapter in which he describes the USS Vincennes' shooting down of the Iranian passenger plane, killing all 290 people on board. I then got up this morning to read on Zerohedge about the Malaysian Air jet crashing on the  Russian/Ukraine border. Of course, it'll all be blamed on the Russkies, but what really went down, other than the aircraft, will probably never be known. Russia's LifeNews has the pictures of the NewDead, and it's very graphic and heart-breaking.

"Who now the price of this dear blood doth owe?"

Of all things, this pileup of mangled corpses reminds me of the end of Shakespeare's "Romeo and Juliet", when the Prince comes out and proclaims that "The sun , for sorrow, will not show his head", and, in Zeffirelli's version, he then says what's not in the original text, and lambastes the feuding families of Capulet and Montague, shouting at them the verity: ALL are punished! For, as he had stated so eloquently when he laid down judgement at the murders of Tybalt and Mercutio:

"I have an interest in your hate's proceeding,
My blood for your rude brawls doth lie a-bleeding;
But I'll amerce you with so strong a fine
That you shall all repent the loss of mine.
I will be deaf to pleading and excuses;
Nor tears nor prayers shall purchase out abuses;
Therefore use none; Let Romeo hence in haste,
Else when he's found, that hour is his last.
Bear hence these bodies and attend our will:
Mercy but murders, pardoning those that kill.

Thus does Shakespeare represent, in the 16'th century via the embodiment of the Prince, the ascendancy of State power over feuding families. Yet now, in this so-called globalized world, we somehow feel that a remote disaster touches us not, but we too, "Have an interest in your hate's proceeding", but have no prince to scold the feuding parties, as it's now the States whose rude brawls leave us lie a-bleeding.

The UN was formed to stop this barbarity, but its uselessness in that regard was never made more manifest than when Colin Powell sat before it and laid out a pack of lies that none believed and everyone accepted.

So we're five centuries hence, and nothing's changed,
At best, the world's just more deranged
For it's not just Russia, or Ukraine
that spattered those bodies o'er that bloody plain,
It's the thirst for power and the stoking of greed
That builds the armamentaria we just don't need.
When its uttered and sung like religious cant
It always gives voice to a Nationalistic Rant.
So I fear "This day's black fate on more daze doth depend;
This but begins the woe others must end."






















Tuesday, July 15, 2014

Ben's Stein Way: Another Econo-missed Playing the Wrong tune.


Hope Floats a Loan



Doug Noland's most excellent post on his blog on Prudentbear.com, the CBB, last week was entitled "2014 vs. 2007", and starts with a quote from that idiot, even for an of economist, Ben Stein, writing for the NYT's in another of his Neo-con flag-waving rah-rah's for the Bush Regime's cadre of Oiligarchs' Secret Energy plan of destroying the world economy by waging war in Iraq in order to push oil prices up to stratospheric levels and make the enormous investment in horizontal drilling and fracking, made by Vice President Cheney's Halliburton, whose payroll he was still on well into his first term of office, despite the enormous conflict of interest it represented, economically feasible, spouts the same garbage all of the economists, as the bought toadies of government they are, were selling at the time:

 “The job of an economist, among many other duties, is to put things into perspective. So, because I am an economist, among other duties, here is a little perspective on the recent turmoil in the stock and bond markets. First, when the story of this turbulence is reported, the usual explanation mainly has to do with some new loss in the subprime mortgage world… Here is the first instance in which proportion tells us that something is out of whack: The total mortgage market in the United States is roughly $10.4 trillion. Of that, a little over 13%, or about $1.35 trillion, is subprime — certainly a large sum. Of this, nearly 14% is delinquent, meaning late in payment or in foreclosure. Of this amount, about 5% is actually in foreclosure, or about $67 billion. Of this amount, according to my friends in real estate, at least about half will be recovered in foreclosure. So now we are down to losses of about $33 billion to $34 billion… The total wealth of the United States is about $70 trillion. The value of the stocks listed in the United States is very roughly $15 trillion to $20 trillion. The bond market is even larger… This economy is extremely strong. Profits are superb. The world economy is exploding with growth. To be sure, terrible problems lurk in the future: a slow-motion dollar crisis, huge Medicare deficits and energy shortages. But for now, the sell-off seems extreme, not to say nutty. Some smart, brave people will make a fortune buying in these days, and then we’ll all wonder what the scare was about.” Ben Stein, “Chicken Little’s Brethren, on the Trading Floor,” New York Times, August 12, 2007

Now, of course, anyone who has to state that he's an economist, is so by name only, and such is the case with Ben Stein, as anyone who ever saw his juvenile, self-adulating Comedy Central fiasco, "Ben Stein's Money", in which he challenges contestants, of which he's purportedly one also, to answer a set of questions designed to his advantage, for paltry, even pathetic, amounts of cash (from his own pocket, supposedly), will attest to. But parsing the story as if he were one, it quickly becomes obvious that it is merely a series of nonsensical articles, although but one in a series of them, that the NYT would dutifully print each week, despite the fact that all they ever demonstrated was a complete lack of even the rudimentary knowledge of anything but a sycophant's take on the reality our dire economic straits.

 Disregarding his claim to some kind of "duty", since obfuscation and rationalization are the only ones any economist has actually ever demonstrated, let's move on to the moronic perspective that his beknighted duty calls on him to offer his poor readers. He starts with, "First, when the story of this turbulence is reported, the usual explanation mainly has to do with some new loss in the subprime mortgage world…" Now, if you or I submitted an essay to the NYT with an opening sentence this sloppy and meaningless, they would simply go no further before rejecting it, not for its economic failings, which are rampant enough, but for the footloose treatment of tense, as he states, "When it is reported ...", as though he's talking about some future event, although he's commenting on it in the present tense, because it happened in the past. He then qualifies every single word, as he continues: with, usual explanation, mainly having to do with some new loss in the subprime mortgage market. Stein then reels off a bunch of stats regarding the size of the housing market vis-a-vis the size of the amount of it that's subprime, and then states that the economy is strong, so these few losses are minuscule and, "USA! USA!", everything's cool, and those questioning the Supremacy of the Almighty dollar are just, well, nutty.

There's not a mention of Ameriquest, and the others, (FAMCO, Countrywide, Wamu, Prudential, MBIA, New Century, to name but a few), nor of their selling of fraudulent products; not a whisper about Countywide, nor a sound made regarding Bear-Stearns, Lehman, shadow banking, Mortgage backed security, CDO's (never mind CDO's-squared), covenant-lite loans, SIV's, SPV's or the swelling federal deficits that, BTW President Bush was responsible for, there was just no Tea Party then, because, of course, "(Republican-imposed) Deficits don't Matter", right?, nor of the monolines, all doing the same thing that AIG was doing, raking in piles of cash by taking on enormous liabilities with absolutely no resources to pay for the risks they were insuring against (usually referred to as fraud, when you don't have an administration in power intent on waging war while shoveling huge piles of money onto the already enormous mountains of cash of the "haves and have-mores" it snidely counts as its supporters.

Now, unlike Ben Stein, I am not an economist. Nor, of course, was I at the time he wrote this tripe. Yet I was not only cognizant of all of  the above perilous "products" of the Shadow banking system but was also aware of the fact that when such so-called products are conceived of and foisted on the public in the first place, and then extended to the least credit-worthy of its citizens, via complex "securities" that are, by design, engineered to hide risk, it is not a sign of an "extremely strong" economy. When Enron-style accounting is used on a globalized basis, it is not a sign that, "The world economy is exploding with growth"; nor that "Profits are superb", but instead tells the story that  "terrible problems" don't "lurk in the future", as BS proclaims (a strange statement, given the sanguine view he presents to readers), but were at work then (as they are now) to plunder the economy of its productive assets and, having taken the true driving force of the economy away, leave it running on the fumes of financial shenanigans and trumped-up confidence in wealth that no longer exists but has been systematically looted. This persuades the scammed populace to continue to take enormous risks, that they don't understand, with the financial resources they think they have, while the financial sector feeds at the trough of government largess and complicity in the FIRE economy's self-serving schemes.

And it is to this Confederacy of Putzes, (those "smart, brave people" making a fortune in those days, among whom was Madoff, who, while BS wondered, "What all this scare was all about",  was still raking his clients over the coals), to whom Ben Stein had the Duty he referred to in the opening sentence of this essay. It was the Madoffs and the other shysters that Stein was insisting we continue as a country to give free rein to as they skimmed off everything of value from our economy and sold deliberately designed weapons of mass economic destruction, called derivatives, to the rest of the world, all dutifully stamped triple AAA.

 And now, in the form of Sovereign debt and a myriad of newer scams, we continue along the same path. So, although the Stein Way has since been proven to play a Pied Piper tune that leads us down a path that ends in a Thelma and Louise-style debacle, we still dance to the same tune, and still refer to the Fed's repression of interest rates as "leaving out the punch bowl", as though our pensions, savings and economic future were all just some High School Prom. So we should not be surprised (although, of course we will be) that when it is taken away next time (and there is always a next time, Capitalism is nothing if not cyclical, Central Bankers  notwithstanding), the ones who'll be left standing in this game of Musical chairs, is not the banksters, who will be comfortably ensconced in their barcaloungers, but the rest of us who failed to hear the sour notes being played and parlayed.









Thursday, July 10, 2014

Dresner's Got The Wrong Depression.

  When Bull Markets are goaded to outlast their natural run, Creative Destruction becomes simply Destruction. 


In Kirshner's apologia for the New Economic order, detailed in his Boston Review's critique of Daniel Dresner's, "The System Worked: How The World Stopped Another Great Depression" in which the all the earnings of Labor are siphoned off into the bank accounts of the Rich and Shameless, leaving workers enough to eke out a threadbare existence only by working more than one job and even then, not having the wherewithal to ever buy a place to live, even though, following the Chinese example, we build condos galore for enormous sums of money such that whole cities, or suburbs, in the case of the USA,  are replete with them, yet the workers who built them must still live hand-to-mouth in their cars or on the streets. In places in the US, perfectly good homes are being torn down while people go homeless, because that's how you make money in the New Economy. Like Corporations that primarily exist, not to serve their customers, but to dominate their markets, home-building, like everything else, exists not to provide housing, but to enrich speculators in Home-building enterprises' stocks. Hey, as Kirchner, echoing Dresner, proclaims, See? the system works!

Comparing it to the debacle that followed the Great Depression, and therefore, exultant that the collapse built into the elitist, Class Warfare of beggar thy neighbor in order to enrich yourself, not for a better life for you and your children, you already have piles and piles of cash you have no idea what to do with, but just to ensure that everyone else, but especially the workers on whose toil your own ascendancy depends, get nothing, Kirchner, like The Krug, and a myriad of other economists, look back only as far as the Great Depression, even though the 100 year anniversary of the Financial Panic of 1907, 2007, was when the recession and its associated Credit Crunch that brought on, and was really the cause of, the collapse of 2008, actually began.

As has become usual with me, it was pure happenstance that seeing this article corresponded with my completion of Michael Hudson's, "The Monster", a book I had the SFPL reserve for me  under the false assumption that it was the latest oeuvre by Michael Hudson of, "Super Imperialism, The Economic Strategy of American Empire" fame, written in the 70's, but found out instead that this Micheal Hudson was an investigative reporter working as a staff writer for The Center for Public Integrity (a word no longer applicable to the Private sector, as integrity has to do with morality, an impediment which the private sector prides itself for lacking) and the Monster to whom the title refers is Roland Arnall and his mortgage-scamming company, Ameriquest.

So it was especially galling for me to see the Dresner book and it's arguments lauded when in actuality it saved a system that worked, as it was designed to work, internationally, as per the other Michael Hudson, and nationally, as per "The Monster" Michael Hudson, to funnel the savings, pension plans and earnings of the entire globe into the coffers of a very few select players, all buttressed by the completely insane jingoistic military as a completely bought and paid for (by the very citizens at whom its guns were pointed) Sentry to guard the hoards of the Rich from the hordes of the poor.

A few articles I read along the way to actually essaying to essay this book, though, got in the way, because they had so many cogent and wonderful  points that made me wonder if I may not perhaps be getting too, I don't know, cloistered? Insular,? reading only those sites/authors that agree with what I already believe and therefore don't challenge my perceptions (The Boston Review article on which this post is based notwithstanding), because of the authors that I read, and all of whom I perused cogent articles by, between the short time I finished "The Monster" and started this post.

These include, of all people, as I haven't seen anything new from  him for awhile, Noam Chomsky, writing for ATOL (Asia Times Online, a much better alternative press than RT, as it gives much more even-handed reporting. RT is good at pointing out the glaring hypocrisies enunciated by the Western governments, but is, because of that, reactive. ATOL, however, reports news, sometimes in contravention to what the West reports, but oftentimes, since the Western media simply ignores most of the ROW, news and opinion that you'll not get anywhere else). Then, I noticed Michael Klare's article on the Resilience website expounding on his bête noire, now his cause célèbre (funny how that happens), the Energy Wars that everyone else is assiduously ignoring, a fact that emphasizes that it must have some validity.

Then my attention was drawn to William Blum's Anti-Empire Report's article on Snowden and its reference to President Obama's hyper-nationalistic speech to the matriculating class at West Point's US Military Academy, a speech that is deserving of a post of its own to rip it to shreds, wherein he extols the hyper nationalism that has become the hallmark of his administration, a jingoistic nationalism for which the US condemns, as the above-referenced Chomsky article points out, terrorists in the Mideast, as it endangers the US oil supply.

But, per Kirshenr, Dresner makes no attempt to reconcile any of these factors in his description of the "Economic Malaise" that currently grips the world economy in the wake of what he sloppily refers to as "The Great Recession", a term, as I've pointed out in prior posts, and insist is still the case, inaccurately describes the calamity, since it was/is, by definition, a depression, the repercussions of which will continue to plague us for years to come, just as the so-called Reagan Revolution does to this day, with sub-par growth , dysfunctioning economies and escalating global tensions amid a continuing mad scramble of States to claim for themselves resources that belong to them only because they say they do and have the military prowess, ie, totalitarian regime capable of enforcing the financing of military adventurism onto a public besotted by over-amped testosterone-driven fantasies of Exceptionalism, to have those claims go unchallenged.

As pointed out via several incidences documented in David Crist's, "The twilight war : The secret history of America's thirty-year conflict with Iran", although certain covert actions of intelligence agencies were instrumental for the US assuming its current stance on the world stage, the overwhelming "Crossing the Rubicon" point in history, where the US turned from being a country intent on spreading democracy to one intent on spreading lies about democracy, because it was when the Carter Doctrine was put into force as the guiding principle of US foreign policy, and the ferreting out of oil anywhere it existed began in  earnest, together with the concomitant rejection that the US polity had to conserve energy at all, or plan for a future of constrained use of petroleum, were rejected outright, and the ongoing crusade to dominate the entire globe in its pursuit of oil has morphed into the sole purpose of not only US foreign policy but is one that undergrids the entire economic base and includes the growth paradigm upon which rests the social fluidity of the Class system the US denies exists, wherein, instead of dividing the pie of economic benefits amongst its people, the US pretends that growing that pie will, to mix metaphors, raise all ships, floating on the hot-air-puffed waves of meringue from which such fluff froths into existence.

It is because of this philosophy, and its disastrous repercussions, that the financial crash of 2008 occurred, but nowhere are the dots connecting these phenomena connected, or the inevitability of another collapse, since failure to do so means we just start the same mad caucas race all  over again, and "you can begin and end exactly where  you like": so the price of oil has nothing to do with economic growth, and the growth of a larger and larger financial sphere, in which Education, Healthcare, and Housing, with its enabler of ever-increasing, unfettered-to-reality costs, Finance, siphoning off not only every nickel earned, but, via credit and the usurious rates charged to access it, every nickel you'll ever earn, is used to return an entire underclass to the debt-servitude of feudalism whilst expecting those same economically repressed subjects (the NSA and out-of-control SWAT-enabled police Forces have made a joke of the word "citizen") to drive an economy based on consumerism from which all the consumers with any wherewithal have been removed, yet then, as economists the world over are doing, scratch your head in wonder as to why there is such constrained economic growth. It's like pushing an armless person into the deep end of the swimming pool and wondering why they're drowning.

Yet in this atmosphere of squalid cronyism, Institutionalized fraud, and State-enabled economic predation, we're supposed to take comfort in the fact that "The System Worked", ignoring, as Kirshner opines, the fact that it worked a lot better for some people than for others, those others he refers to being everyone else except, not the popularly intoned 1%, but the, more accurately stated, .01%. Which he states as if that occurred simply by happenstance and not by the machinations of public servants who work mightily to maintain that status quo, as it's what put them in power and what keeps them there with their salaries at stratospheric levels when compared with the salaries of those whose tax dollars are needed to pay them. This is unceremoniously made apparent by the sea of poverty in which the state of Virginia is surrounded where it sits amidst the rest of the Southern States that are mired in low-wage hopelessness, while Virginia, full of fat-pay-checked Federal Employees, stands out as the sole island of prosperity in an impoverished ocean of Free-for-all Enterprise, wherein the Prize is a big-fat government contract to use to get public money for your oh-so-private firm.

But since, "compared with the Great Depression", the global system remained intact and free from protectionism, the system worked. But why it is important to note that the Depression starting in 2008 should more accurately be compared to the financial Panic of 1907, referred to as "The Rich Man's Panic", or, more cogently for our own circumstances, "The Bankers' Panic" is that, not only did it lead, in a mere seven years, to a global conflagration unlike anything mankind had witnessed before, destroying centuries of an extant international order, including the destruction of the British Empire, which in turn eventually gave rise to the Nazi Regime, the genesis of which is easily seen to have occurred in a prison cell in which Hitler, a casualty of that first War, wrote his plan for conquest and retribution, "Mein Kampf".

The Panic of 1907 was caused by a "retraction of market liquidity by a number of New York City banks and a loss of confidence among depositors during a recession", a much more similar state of affairs than the Great Depression, but one which they can't point at and say , "See? We fixed it, the system works". Because the levels of rehypothecation, defalcations, margin-betting on stocks, uncollateralized loans, embezzlement and unprecedented leverage on dubious assets was more closely resembling the state of the mania pre-2008, this is the more accurate crash to compare the Panic that ensued 100 years later, and it is in this year, 2014, that we reach the 100'th year anniversary of the slaughter that collapse predestined that I feel we should be looking at more closely and, instead of congratulating ourselves that the system works, be questioning ourselves as to why it works, as it is designed to do, for so very few of the billions and billion of humans on the planet, the welfare of whom, one would think of any economy described as global, should have as its first and foremost priority.