Meanwhile At the Imperial Display

His Serenity Sprach

"The State of the Union is Strong."

Whew!

Free Platinum! (Or, The Coin That Wouldn't Die)

Back in the Day, c. 1896

My grandfather was born about the time that the Free Silver movement got under way, and my father was born at the tail end of it. So Free Silver lasted about a generation, and it never seemed to accomplish its aims.

Nevertheless, it got unanticipated results, many of which are with us today.  The Fed, for example...

I doubt that many of the Platinum Coin enthusiasts know -- or care -- much about the Free Silver movement after the Civil War (from about 1873 up to about 1900), but it was a very high profile populist effort that ultimately involved the Democratic Party and Democratic presidential candidate William Jennings Bryan, whose "Cross of Gold" speech of 1896 remains one of the most important American political speeches of all time.

So far, the Platinum Coin effort hasn't produced anything close to the populist fervor of the Free Silver Movement, or anything like the eloquence of William Jennings Bryan, nor has it even begun to generate  a populist movement itself, primarily -- I'd say -- because it is a fairly esoteric strategy discussion confined to portions of the internet and television "news."  It could turn into a populist crusade, but it hasn't yet.

Much as happened with the Free Silver Movement, the Platinum Coin effort might lead to completely unforeseen and unintended consequences for good or ill.

When I was first learning about Free Silver, I did not understand it at all. It seemed to make no sense. At the time I was first hearing about it, sometime in the 1960's, silver coins of all denominations and genuine silver dollars were still in circulation, and I had a few silver dollars, some of them minted between 1879 and 1900, and from that evidence, it seemed to me that silver was being coined extensively throughout the period of the Free Silver movement, just as the Silverites were demanding.

But it wasn't so. In fact, there was far less coinage of silver during the period of the Free Silver movement than advocates were demanding. The situation was not unlike the current economic and financial conditions in which a handful of hyper-wealthy individuals and their chosen financial institutions have almost complete control of the economy and can exploit and prey upon any population segment they choose.

Through their control of the economy, they also control the government.

The People have little or no say in policy decisions affecting them.

Americans seem to have little or no understanding of the circumstances of most Americans' lives during the Post Civil War period. I don't claim to understand it completely myself, but what I do know is that most Americans at the time were barely getting by if they were doing well (enough), and many were not doing well at all.

Bluntly, this was a Third World country -- with a Frontier. The Frontier made a number of things possible: nearly endless natural resources for extraordinary exploitation at very little cost; somewhere for people who were not making it in the city to go and try their luck on the land; convenient dumping grounds for all sorts of experimental, marginal and rejected people and ideas. Oh yes, and "freedom" -- which in the case of the Frontier too often meant liberty to slaughter humans and animals at will.

Without the Frontier, the pressure of the economic exploitation of the 19th century corporate class would have likely led to continuous revolt and revolution; as it was, the People endured a lot of suffering and bloodshed as part of the constant -- and very violent -- efforts of the Overclass to suppress popular movements and uprisings which were ongoing throughout the period.

By the end of the 19th century, the Frontier was officially "closed." There was no longer that particular outlet for discontent on the one hand and extensive "free" exploitation of resources on the other. Yet even while there was an apparently open Frontier, the American People were heavily burdened by debt and by constant economic boom and bust cycles that put millions of Americans in economic and physical peril.

The Free Silver movement was intended to relieve some of the debt that kept so many American bound and in poverty, particularly farmers, and it was hoped that Free Silver would begin to tame the wild fluctuations in the economy that had raised up a few to enormous wealth and left most in poverty and misery. Ultimately, it was even believed that Free Silver would be the mechanism by which the government would finally be put in the hands of the People themselves rather than solely functioning on behalf of financiers and corporate interests who owned and controlled it.

Free Silver was never successful directly, and yet, in a way no one anticipated, many of its objectives were achieved indirectly, at least for a while.

Free Silver was  one of the many elements of 19th century Populism, a phase of American political history that is not well understood, and which is often confused with the rise of Progressivism.

Progressivism, rather than being a populist political movement, was a reaction against the rising tide of populism in the 19th century, and it arose out of a mostly Republican and corporatist framework. Rather than continuing to battle the People and Populism, the Progressives saw that the way forward was to adopt some of the elements and demands of the Populists, adapt others, and ensure that a technocratic class of experts would be charged with governing on behalf of "what is best."

Free Silver was deemed not to be "best," and instead a complete overhaul of the financial and monetary system was undertaken which resulted in the establishment of the Federal Reserve among many other changes, efforts undertaken in reaction to the ever worsening cycles of boom and bust and the social and political dislocations and disruptions they caused.

The Frontier was closed, immigration was restricted, worker protections began to be implemented among many other changes.

Free Silver was never adopted, but when the Sherman Silver Purchase program got under way, coincidentally the economy promptly went into a tailspin (the Panic of 1893), which was the worst economic depression the nation had experienced up till then. It was a traumatic event. Some Americans blamed the adoption of some Silverite demands for the Panic and the subsequent depression, and this belief led to the widespread rejection of Populist and Free Silver economic demands. That in turn left a wide opening for the acceptance of Progressivism as an alternative.

All of which led to many intended and unintended consequences.

The Platinum Coin hasn't reached the level of popular interest and advocacy that the Free Silver movement did, and it may never reach that level. It may not have to. By breaking the thrall of the financial interests -- at least for a moment -- that own and control the government, by pointing out that there are viable alternatives in the economic and political spheres, that bold action to change the situation on behalf of the People is possible, the Platinum Coin has the potential to open up a wide range of alternatives for consideration.

The Coin itself may never be minted -- and it may never have to be. An alternative more like the advent of Progressivism may well arise, providing some of the relief sought by advocates of The Coin, but leading ultimately in another direction.

If the Debt Limit issue is allowed reach international crisis levels, we may be surprised at what is done... May be sooner than we think, too.

The Problem With Borosage, He Say

In his widely touted "Budget Bedlam" piece over at Campaign for America's Future, Bob Borosage has written the kind of piece that roils the waters but confuses the issues in such a way that one can be certain that nothing will be done. Apart from relentlessly pointing out the obvious, he provides no real prescription for action -- almost as if he might not want anything to be done about the "bedlam" except continuation of the argument.

His bullet points are self evident:

1. The economy is still broken. 

But let's be clear. Broken for whom? Stipulate that the economy is not working to the advantage of the those whose incomes are derived from their labor, but isn't that how it is designed? And don't the policies of the government since the outset of the Perpetual Recession all those years ago ensure that workers' incomes will continue to fall, middle class wealth will continue to erode and evaporate, and unemployment will continue to be scandalously high essentially "forever?" But if this situation is maintained by policy, doesn't the economy work just fine for someone or some class of someones? Of course it does. The economy is working just fine for what's commonly known as the Rentier Class, the exploiters, predators, looters and plunderers who have amassed ever greater portfolios of assets and resource control as the middle and working classes have seen their assets (if they had any) stripped and natural resources have been plundered at an ever greater rate. The economy "works" for those at the top of the heap better than it ever has, something Borosage and his ilk are loathe to admit.

2. You can't "fix the debt" without fixing the economy.

Oh? Is there someone who wants to "fix the debt?" Or is there someone using "Fix the Debt" as a marketing slogan for a cabal of bazillionaires intent on ensuring their perpetual low taxation and their looting and plunder? By now, isn't it obvious that The Debt is NOT the real issue? Perhaps it's time to acknowledge that Nobody Who Matters cares a whit about The Debt; what they care about, really care about, is that their ability to loot and plunder and accumulate assets not be interfered with in any way and that their tax burden not be adjusted upward unless every dime of such adjustment is distributed at the Top. Again, nobody Who Matters cares about The Debt. Going into perpetual debt (as the United States Government has been doing) is not The Problem. The Problem is Who Pays and Who Benefits. As long as the working and middle classes, as well as the non-working parasites and drones, are benefiting but not paying the majority of taxes to pay for their benefits there will be pitiful complaints about The Debt and attempts to bamboozle the rest of us to "do something" about it. The economy works just fine for the High and the Mighty; it doesn't need fixing. What's being demanded is that the Low and the Miserable pay for everything -- including The Debt.

3. You can't fix the economy by "fixing the debt."

Again, whose economy for what purpose? The point of all the yowling about The Debt is ultimately to shift the burden of carrying The Debt onto the already groaning shoulders of the working and middle classes and to eliminate insofar as possible the benefits said classes derive from shouldering a substantial portion of the burden. Look at Europe or anywhere that neo-liberal policies are being or have been implemented with a vengeance. The whole point of the neo-liberal program is to ensure the betterment of the High and the Mighty and to diminish the potential for the Lesser People to rise -- or do anything about it.

4. You can't "recover" to the old economy.

This is the tell to me that Borosage and his outfit exist to keep the "left" as tame as possible while the looting and plunder by their Betters continue unmolested. This is as pure a statement of the necessity for economic "restructuring" -- ie: redistribution toward the top -- as any I've seen in the ::Left-o-Sphere::. Most of those who think about these things and practically all of those who are acting on the "left" have no interest in recovering to the old economy of bubbles, boom, bust and recovery to the top.

Restructuring by redistribution from the top is part of what's required, but getting off the bubble, boom, bust cycle is even more important. Renovating infrastructure is all well and good, but to what object? To address climate change? Really? How so? Describe it. Unfortunately, Borosage and most of his colleagues write dandy platitudes, but when it comes to specificity, they grow mute. It's not that they don't have ideas, they do. Their muteness is due, in my view, to the fact that their ideas either support the return to a bubble economy, or they support redistribution to the top. In other words, recovery to the old economy, with a slightly improved sense of responsibility.

5. You can’t build by focusing on what to dismantle.

What does that even mean? Building and dismantling are two distinct functions, but sometimes dismantling is necessary before the rebuilding can commence or sometimes they need to happen simultaneously. It's possible to do both at once.

"Rebuilding the middle class" is almost meaningless as well. It's a political slogan, but what constitutes "rebuilding" in the case of the middle class? Borosage doesn't say. What he does say is "rebuild infrastructure." How that rebuilds the middle class is left to the imagination.We can fill in the blanks and connect the dots if we want, but when we do, we're right back where we started from, a restoration of the status quo ante (with a somewhat greater sense of social responsibility), which can be practically guaranteed to get us to where we are today.  This is not what we really need. But if the goal is to rebuild the middle class as it was (more or less) during the '50's and '60's, we're going to wind up in the same pickle.

How about reconception? Dismantle and build at the same time?

6. Washington needs more Hippocrates and less hypocrisy.

Really? And what's that supposed to mean? Get rid of politicians and substitute technocrats? That's what it says to me. We need a different kind of politics to be sure, but the technocratic solution, the top-down authoritarian response that is destroying social, economic and political systems all over the world in order to substitute the neo-lberal theology/ideology of redistribution to the top. It's always sold as being good for the People in the long run.

The political system is broken in part because it cannot be responsive to -- or responsible to -- the People except in the abstract. It is fully captured and beholden to a handful of increasingly irresponsible billonaires who simply don't care what happens to the People -- when they're not being intentionally cruel just for the hell of it.

It's useless to say what the government should be doing -- we know what should be done. We also know it can't be done by this government under the current political and electoral rules. We need systemic reform, and that's not going to happen so long as the focus is on trying to make a broken system "do the right thing."

7. Focus on the predators not the prey.

This means what? In the Borosage world, it means focusing on cutting back health care costs. Really. While I would never be one to assert that the health care field isn't full of predators, that's not what he's getting at. He wants systemic reform of health care costs to bring down the debt. 

"The Debt" is a marketing slogan, a con in other words, wielded for whatever slight of hand is necessary to continue the looting and pillage without interference. The predators are the ones who profit from the looting, and for the most part they are not the health care professionals that will face cuts -- in staffing levels and salaries -- which are already taking place in an effort to keep healthcare costs down in order to enhance profits.

Anytime someone talks about reducing health care costs, what they are generally talking about is restricting access, limiting treatments, reducing staff levels, reducing salaries and payments, increasing co-pays and so on.

The focus needs to be on improving care, access to care, and utilizing preventative care. Most of all, we need a single payer health care system modeled on those already in operation.

Borosage is someone who really wants to preserve the status quo in the short term and revert to the status quo ante (pre-2008) over the long term. The status quo cannot be preserved in the face of the successful ideological/theological economic revolution of the neo-libs. What we need is something else again, something better, not a restoration of what used to be.

The Austerity Confusion Continues

First, the notion that the measures just passed by the Congress are "not Austerian" is widespread and wrong, and this misperception would be hilarious if real people weren't being forced into poverty because of it.

Yet I've seen a lot of cant and rhetoric claiming that because "taxes were raised on the rich" -- yeah right -- the measures "can't be Austerian." Not only that, but there were some spending programs in the mix. (Like yet more corporate welfare?) AND unemployment benefits were extended! Yay!

Reducing the disposable income of the masses through increased taxation is Austerian pretty much by definition, and that's what's happened with the expiration of the payroll tax holiday. What makes it even more Austerian, by definition, is the fact that at least twice as much revenue will be raised from the increased payroll taxes on the masses as will be raised from increased income taxes on the rich. Isn't that wonderful? Isn't that the way it's supposed to be?

Second, the argument that the increased payroll taxes will be used to shore up Social Security is something of a crock. During the payroll tax holiday, the shortfall in Social Security revenue -- which is used to pay current benefits, not socked away for the future -- was made up dollar for dollar from the general fund, something like $110 or $120 billion per year. What it meant was that any shortfall in Social Security revenue to pay existing benefits was paid directly from the general fund, and guess what? That's exactly what happens all the time and will continue to happen for some time to come as the Baby Boomers retire in their multitudes. We can call it "cashing in" Social Security's Treasury Bonds if we want, but the effect is the same: any shortfall between SS revenues from payroll taxes and obligations to beneficiaries is made up from the general fund.

That's why there is such a push to curb, limit, cut, reduce, hack, and trim Social Security benefits now and going forward.

The Chained CPI being promoted as the "least bad" of options. The point is to reduce the amount SS draws from the general fund so as to avoid raising revenues from those who have the most in order to the benefits due seniors and other recipients of Social Security.

The increased payroll taxes are actually shoring up the general fund, making it less necessary to increase taxes on the rich in order to pay for Social Security and other benefits. But still, there is a drain on the general fund as SS Treasuries are redeemed, and any drain at all to pay for Old Farts is considered anathema by the Highest of the Mighty, so there will continue to be calls to cut benefits, no matter how much revenue is extracted from the masses. In the end, there is no dedicated Social Security money which cannot be taken for other purposes if Congress wants to do so and the White House agrees. If Congress and the White House want wars, for example, and need money to pay for them, they will get that money anywhere they can, and if that means raiding Social Security, they'll do it. In fact, Social Security has already been fully and repeatedly raided -- to pay for wars and tax cuts on the rich among many other things.

And there is nothing you and I can do about it.

But income tax rates were raised on the rich, né? Well, yes, slightly. And that increase -- which may not actually produce much revenue, we'll see -- is also by definition Austerian. Of course the effect of the income tax increase on the rich is nothing like the effect of the payroll tax increase on the working and middle classes. In fact, if  the rich actually pay the increase the effect on them will be almost imperceptible. The increased payroll taxes on the working and middle classes, on the other hand, can have a devastating effect for those on the financial edge.

I've seen lots of commentary from people who say "It's only $50 a pay period! I can afford that! And it's going to Social Security, so it's a good thing!" Well, a lot of people can't  afford it, especially not after their income has already taken such a battering from the Permanent Recession as it is. The revenue is not going to shore up Social Security, it's going to shore up the general fund so that taxes on the rich won't have to be raised to an appropriate level. Millions upon millions of Americans have already been forced into poverty during the course of this Perpetual Recession, and due to the increase in payroll taxes without any offset, millions more  will be forced into poverty. Oh, it's lovely that some working and middle class households can afford to lose 2% of their disposable income, but many cannot.

The fact that there was no effort to provide an offset for the loss of working and middle class disposable income is the tell here. The Neo-liberal/Austerian point, after all, is to make the masses pay for everything and insofar as possible to relieve the rich and powerful from taxation, even provide them with handsome emoluments and subsidies -- paid for by extractions from the masses.

And we should note -- though without surprise -- the extraordinary levels of corporate welfare included in the Neo-liberal/Austerian measures just passed and signed into law. My, my, my. But then, corporate welfare is part of the Neo-liberal/Austerian program, after all.

There has been a lot of argument regarding the fact that "Austerity doesn't work." But that avoids the point. "Doesn't work" for whom? It doesn't work to the benefit of the masses, of course not. It's not meant to -- no matter how it's sold. It is meant to enable a diminishing cadre of super-rich to accumulate a greater and greater and still greater number of assets (not "wealth" so much as assets)  through and by which they are able to exercise greater and greater levels of power. And for those purposes, Austerity works wonders.

Austerity is imposed in order to take assets from the masses at the lowest possible cost to the plunderers and predators, pure and simple. And it works.

The confusion about all of this is a factor of the propaganda that surrounds the imposition of the policies of Austerity (Shock Doctrine, Neo-liberalism.) Without the propaganda, these policies cannot be imposed. And the propaganda is everywhere. Surprisingly -- or maybe not -- it pervades the "progressive" new media, to the extent that it is almost impossible to avoid or in many cases to cut through the bullshit.

Under the circumstances, people by and large don't know what to believe. Confusion is inevitable (and desirable to the beneficiaries of these policies.) The People "go with their gut," and too often that means buying a lie. Grifters, hucksters and conmen have never had it better.

The Problem of the Gerrymander and Strategic Make Believe

The Original Gerrymander

A couple of years ago, I made note of the fact that Democrats really dropped the ball in the 2010 election at the state and local level, to the extent that Rs won dozens of state houses where they would have a free hand to run wild and to redistrict House seats -- ie: gerrymandering them to protect Republican incumbents and create new, safe districts for Republicans -- thanks to the 2010 Census. And so it has been.

The current Republican lock on the ridiculous clown show that is the House of Representatives is the direct result of Dem Party failure (catastrophic, in my view) to work the states and localities in 2010, an election in which they seemed to put up little more than a sham fight when it came down to it.

To my mind, this catastrophic failure was a deliberate -- strategic? -- decision by the Party Pooh-Bahs to "let the states go" and let the clown show transpire. The protests against Scott Walker's overreach in Wisconsin were just the beginning of what has been a long and exhausting struggle, not so much against Rs as against Ds -- and a D Party apparat -- that enables them.

The dysfunctional Congress is merely a symptom of a much larger problem, that of the Uni-Party with two collaborative branches that put on a Show for the entertainment (and profit) of the Big Media and for the bamboozlement of the Public. Let's not fool ourselves. That's how it works. Whatever is done in public is a Show. What's going on behind the scenes is the real work of the governing classes, work that always inures to their benefit at the expense of everyone else. They -- the rulers -- believe it's supposed to be that way, as if determined by God His Ownself, which is why they can be and for many years now have been totally oblivious to the needs and interests of the People and how cruel and even sadistic they can be in their ignorance and contempt.

Their Operating System and Theory is to Govern Contrary to whatever the People's Will or Interest demands.

The Ds are no Salvation Party, but their failure of due diligence in 2010 by letting so many state houses go was instructive to me regarding the Party intent for the next few cycles. At the upper levels, the Ds had fully adopted and accepted Neo-liberal "economics" and they saw that the only way to get it implemented without throwing everything into complete chaos was to pretend opposition and to manage dissent.

I'd suspect this comes from the lessons of success of the IMF and other outfits imposing Neo-liberal "economics" on many Third World nations,  where protest had to be managed (sometimes quite violently) and indeed governments themselves had to be overthrown (again, sometimes violently) -- which looked bad -- in order to impose the Doctrine of Exploitation which is at the root of Neo-liberalism. The brutality of the early pillaging was ugly to say the least; wasn't there a way to do this without all the tumult and bloodshed?

Yes, of course. Strategic make-believe, ie: The Show. As Reagan and Thatcher had demonstrated, the People Who Matter will go along with the program of plunder and exploitation so long as they think they're going to get a cut of the spoils. The Masses don't matter.  They will do nothing that the Ruling Classes need pay attention to -- as long as their dissent is properly managed. Managing the dissent of the Masses became something of an intriguing game for the Rulers -- which we saw demonstrated with remarkable clarity during the protests against the Iraq War in 2002 and 2003.

People were encouraged to "protest" all they wanted, so long, of course, as they stayed within strictly limited bounds, which they did. This left the Rulers free to ignore the protest -- which they did. The People would actually do nothing except what they were told to do. As long as that was within bounds, the more the merrier.

Wah-lah! Perfectly managed dissent.

Though there have been a number of efforts to break free of the management of dissent (such as Cindy Sheehan's camp out along the road to Bush's Bogus Ranch in Texas -- an early example of the principle of Occupy, btw -- and the Occupy encampments in the Public Squares of the Globe)  they are either co-opted or dispersed in relatively short order. Real opposition fades away -- or seems to.

It's much like what happens in Congress, where dissent is heavily managed and a kind of bogus struggle and its accompanying paralysis is institutionalized. The gerrymander ensures that no matter what the People want or even vote for the charade will continue indefinitely.

Thus, from a strategic point of view, it was necessary for Ds to lose a majority of state houses in 2010 in order to enable the Rs to gerrymander safe House districts for themselves in near perpetuity. It's similar to the odd behaviour of Team Obama in saving the asses of Republicans time and again and always caving to their demands in the end. This is how to enable the victory of Neo-liberal policies without triggering the kind of massive uprising that generally accompanies naked power grabs. Both parties agree that Neo-liberal policies are necessary, but they are unpopular. Thus a minority party -- the Rs -- is delegated to propose and push them ("moving the country ever rightward") while the majority Ds pretend to oppose them -- but always cave in the end. The Rs would be wiped out electorally if there were free and fair elections based on rational districting in this country, thus there would be less of a push rightward and less gain for Neo-liberalism -- and it would take longer, too.

The current policies are devastating to the People, but that's the whole point. I've seen very little understanding of what the Senate bill that the House passed last night really does. This is perhaps the best outline I've seen so far:

"Quibbles" by Kid Oakland

1. The United States is in the midst of a jobs crisis, not an unemployment benefits crisis

2. This tax deal contains an instant, regressive anti-stimulus in the form of a 2% increase in payroll tax for all income up to $113,700.

3. The change from $250K to $450K is being misreported and misunderstood

4. Accepting this tax deal, and its premise that the Bush Tax Cuts should largely be made permanent, means accepting two Americas, those who have, and those who, increasingly, have very much less.

Taxes on the working poor and the middle classes are going up by at least 2%; taxes on the rich, not so much. In fact, it's been calculated that the bite out of higher incomes will be less than 1%. Sweet. There will be no jobs programs or substantial increases in employment for the foreseeable future or ever for that matter. The Neo-liberal economic program of Bushevik tax cuts for the rich will become institutionalized.  The devastation of the Masses will continue unabated.

That's where we are.

If we stay on the current path, it will only get worse.

The So-Called Housing Rebound

There was such a cheery story on NPR a few minutes ago about the apparent 'housing rebound' -- foreclosures are down! Prices are up!

We're in the money! Come on my honey!

And yet, every now and then -- even in these silly little stories that are practically filler -- a hint of what is really going on comes through. Foreclosures are down and prices are up a tiny bit -- a few percent over last year or the year before that or whatever -- because foreclosures are being delayed temporarily and prices are up because foreclosures put on the market are being bought in bulk by "investors" who bid against one another to snap up valuable assets at pennies on the dollar.

This is a version of how this Perpetual Recession works, and why it persists.

Wealth and assets are being stripped from the working and middle classes at a furious clip, while the leisure class and those above it see their portfolios swell with whatever they can hoover up from the increasingly impoverished masses.

They see it is good and they want this game to go on forever. Talk about "money for nothing," regardless of chicks for free.

These economic activities have been going on for years now, bolstered by government policies that ensure the forced impoverishment of millions every year, people whose assets -- whatever they may have been -- are acquired at fire sale prices by the plutocrats and their hangers-on.

As I've said many times, this Recession doesn't end -- and austerity is imposed on the masses to boot -- for a very simple reason, one that should have been obvious at the outset: some people are getting richer than their wildest dreams because others are in such dire straits and distress.

That's how our predatory economy works.

There is no real rebound in housing, nor is there any end to the recession for most people. In fact for many, the economic situation gets worse year by year, and millions and millions more Americans will be forced into poverty before there is an economic turnaround -- if there ever is one. After so many years of the same old thing, it must be dawning on even the densest American that under the current political and economic regime, there will never be a real recovery. As long as there are enough people getting rich off the continued distress of others, there can't be. As long as there are policies which encourage continued wealth and asset stripping from the working and middle classes, there can't be any real recovery.

With regard to the housing rebound, I have meant to write a bit about the situation in our neck of the woods. There have been a lot of foreclosures in this area over the course of the Perpetual Recession, and some of these properties have gone on the market for literally dimes on the dollar, offered at $10,000 or $15,000 or $20,000. Of course they are snapped up by "investors" at these distressed prices and held for the inevitable time when prices rise. Sometimes they're rented, but often they're kept vacant with a property service caring for them sort of until such time as they can be sold again at a profit.

The two properties on either side of us have been vacant for some time. The homeowners on the east tried to sell but were unsuccessful and as far as I can tell, they went into foreclosure and the bank now has the property back. It's on the market at somewhat less than the lowest price the bank would previously accept on a short sale when the homeowners tried to sell. But it's a HUD auction-type sale now, with the price reduced week by week until the property sells.

The homeowners on the west just disappeared one day, never to return. No one knew where they went or what had happened. The property has been vacant for well over a year. The homeowners had been in the mortgage business, and the house was purchased by them in a distress or tax sale for something like $5,000 about 15 years ago. Since then, they had lived in it periodically and rented it out periodically. After the last tenant left, they moved back in for a while, and then disappeared.

A couple of weeks ago, some men in suits came by to let us know that the homeowners had apparently abandoned the property and it was now in foreclosure. That gave us a clue to what happened: our former neighbors took as much money as they could out of the property and strategically defaulted -- and then disappeared. 

In a way, the neighbors played the lenders' game against them -- and at least for now have won. But so many people have lost. More of them all the time. Our rulers ensure as much.

So all the cheery stories about the Housing Rebound can't amount to more than year-end fluff.

Class and Class Mobility in America

This 1957 McGraw Hill educational film -- which was no doubt shown in high schools back in the day, but I don't remember seeing it while I was in school at any time -- is one of the kinds of things that served as propaganda on behalf of the status quo and the Ruling Class in the 1950's. It's a form of indoctrination which I believe grew out of the military practices during World War II, practices which themselves grew out of the Bernays-theories of marketing that got going during the 20's and 30's.

I suppose we can claim to be more sophisticated about these things nowadays, but the propaganda is relentless, and it helps to be aware how Americans have been propagandized and conditioned to believe all sorts of nonsense for a very long time.

It didn't start with the 1950's or World War II; it's been going on since forever.

What I find remarkable about the film posted above is the acknowledgement that you're born into a certain social and economic class and you'll probably stay there the rest of your life no matter what you do -- or don't do -- and that crossing class boundaries to date or to marry or even to socialize more than very casually and superficially is all but forbidden. These truths were self evident at the time, but they weren't publicized, and they absolutely weren't part of the myth of American social and economic mobility.

Since the 1950's, the American class structure has apparently fossilized into one of the most rigid on the face of the earth. The gap between the elites and everyone else has widened into such a gulf that it's essentially unbridgeable, despite the fact that individuals from among the Lower Orders are picked out from time to time and brought aboard the elite yacht -- whether to entertain Their Betters (it's primarily sports and entertainment figures, after all, who manage to reach the upper decks...) or simply as a means to leverage bloodlines -- so it's not true that there is no class mobility at all in America

In fact, there is a great deal of downward mobility that is never mentioned at all. This has been made startlingly evident with the decimation of the middle class during the present economic calamities and unpleasantness. Literally millions upon millions of Americans have been forced into poverty year by year since the collapse of the real estate bubble, and there is little or no hope that any of them will ever rise from their fate. Instead, they continue to be joined by others who have been forced more recently into poverty. This is the New American Class Mobility: down, not up.

The door has been shut, the ladder has been pulled up. And that as they say is that.

Although the film above is propaganda, it's the kind of propaganda that relies on truths (in this case, about the American class structure) to make its point (which is for you to be content with your lot because there is little or nothing you can do about it*). More fashionable propaganda today relies on lies, the bigger and bolder the better, to make its point, often to the point of sheer madness.

Our Betters show themselves more clearly than they realize in the fashionable propaganda of today. They show themselves to be not too bright on the one hand, homicidally cruel on the other. They have no apparent "redeeming qualities," qualities of responsibility -- primarily--  that provided the High and the Mighty of the 1950's some legitimacy, even if they were often off the mark or very deep in error. The whole Cold War fantasy, for example, was an elite invention which appeared to have originated as a fundamental misconception of the reality of the post-war world. The Soviet Union was not a threat. If they had realized that from the outset, there wouldn't have been a Cold War, and much of the insanity among Our Betters today might have been alleviated or avoided. But oh well, blood in the water and water under the bridge...

Downward class mobility is an unprecedented phenomenon for most Americans, and it isn't yet recognized as the only class mobility available to the masses these days. The situation during the Great Depression was similar in some ways, but it was countered by many efforts both high and low to reverse the downward trend.

Now there are essentially none. There is no government effort at all, for example, to reverse the trend of downward mobility. There are no jobs programs, few retraining programs, nothing beyond minimal -- and temporary -- support programs for the unemployed, there are constant -- and quite cruel -- reductions in programs for the destitute, and entitlement programs like Social Security and Medicare are under continuing threat and assault. The critical absence throughout this Endless Recession (which is turning into The Permanent Recession) has been the absence of any sort of comprehensive employment or re-employment programs. They simply don't exist, and because they don't, unemployment has remained at cripplingly high levels for years and years -- forcing millions and millions of Americans into a poverty they will never get out of.

This is not simply a lost decade, it's turning into a lost generation. The consequences of the many policy decisions that have made this so are only dimly seen. We don't yet know just how bad it will be in the future. (The apocalyptic visions of climate catastrophe and whatnot are not to be taken lightly, but they largely leave out the human capacity for adaptation.)  For all the whining the elites do about "uncertainty," it is the common people who are facing an uncertain future, not those at the top, and nothing is being done to alleviate the uncertainty of the masses, nothing. In fact, policy decisions at the top have the effect of worsening the uncertainty below.



(* I remember a time when country music was full of outlaws and rebels. No more. Popular country music has long been all about how lucky and grateful one should be to have a beer now and then and to be working at a job at all, let alone be working long hours for a pittance. It's depressing.)

On Cutting the Social Safety Nets

As we know, Our Rulers set an objective to cut the social safety nets some time ago, and they have been relentless in pursuit of their goals. Such safety nets as were put in place during the FDR/WWII/Cold War Eras have been cut back since the advent of the Reagan Revolution, and many are coming down.

The idea is marketed as Liberationist -- see, Freedom! To starve! Yay! -- but of course the upshot is authoritarian. These things always work out that way for some reason. And here you thought you were Free.

And it is literally Freedom to Starve, let's make no mistake about it. Poverty in America has been growing at a smart clip and there is no sign at all that the trends will reverse. The likelier scenario is that poverty will keep growing and -- gosh! -- no one will have a clue what to do about it; gee, it's just one of those things, you know... As poverty grows, so does hunger -- abject hunger, starvation -- something that has been stalking the land for many years, but you don't really notice or hear about it because most of those who are starving have long been so marginalized (primarily among the homeless mentally ill) that their fate -- whether to starve or to freeze or whatever, get run over or to be shot by the police for being odd -- isn't even noted by most people.  That's how far we have come from the days when we actually thought we were on the way to a comprehensively caring society. The closer we got to it in the '60's especially, the farther from it a faction of our ruling class moved themselves and eventually the rest of us.

Frances Fox Piven and Richard Cloward wrote a book back in the day called "Regulating the Poor," and it was remarkably influential among a certain element of the Liberal Elites in the 1970's and '80's. Eventually, it would give rise to the enabling faction of those same elites. Which is to say that the shredding of the social safety net has been largely accomplished under the liberal -- and liberationist -- guise, rather than as an ongoing aspect of increasingly radical and reactionary rule of the neo-liberal/neo-conservative nexus at the core of post-modern governmental theory and practice.

I doubt that Piven and Cloward had any idea that their examination of Poor Laws over the centuries, and their application of Liberationist notions to the expansion of the Welfare State in America during the '60's and '70's would actually provide the justification for and lead to its destruction, but there you are. After all Piven and Cloward are liberals, and they wrote to celebrate the more humane and liberating features of the social safety net then being implemented... didn't they?

At this point, I honestly don't know. Witnessing the shocking growth of poverty in this country over the last five years and more and the neglect of even basic provisions for those least able to care for themselves as a consequence of public policy decision made by representatives of all political stripes -- every one of whom seems to be under the thrall of a tiny minority of extremely wealthy and inordinately selfish and socially irresponsible individuals and corporate interests -- it's difficult to tell.

Americans have ceded responsibility for social well-being to this handful of moral cretins, and so we have the results we see -- results which ought to be appalling to anyone with a conscience. Poverty, hunger, homelessness, disease, and death. That's the result. It's all around us.

And so a concerted effort is under way to further reduce or eliminate such minor provisions for the well-being of the American People as have survived to date. This means that Social Security and Medicare are on the chopping block, and the Democratic denizens of the White House and Senate are eager to do the chopping -- much as the Democratic denizens of an earlier White House cheerfully ended "welfare as we know it."

At one time, of course, the United States got without much of a social safety net at all, certainly there was nothing to speak of provided from the Federal Government on behalf of the poor and destitute -- which in those days constituted a shockingly high percentage of the American population. People fret that the United States is becoming a Third World country, little realizing that it was one back in the day. Until relatively recently, Americans were by and large poor, and there was little or no succor for the  impoverished masses.

What there was, however, was a kind of escape hatch: the Frontier.

Escape to the Frontier was the means Americans chose to deal with the crushing poverty of the masses, especially the poor urban masses.

But the Frontier closed toward the end of the 19th Century. There was no longer any place to escape to. Free land on which you might be able to make a living was no longer available, and many of those who had gone out earlier to the Frontier were facing ever increasing exploitation and hardship, not the prosperity and freedom they were promised.

I've written a bit about how members of my own family escaped poverty by heading west, and how -- at least for a time -- some of them waxed prosperous. Yet prosperity by itself is an evanescent thing for most Americans. As the middle class shrinks and the supposed wealth of middle class Americans evaporates, "prosperity" for many is now something of a cruel joke.

What is the answer from Our Rulers and the social scientists who serve them? Why shrink the middle further of course! Relieve them of all wealth. Increase poverty. And cut back or destroy whatever is left of the shredded safety net. Freedom demands no less!

Our Rulers agree this must be done. They disagree on how fast and how harshly it must be done.

The People of course object, but their objections are not heard nor are they considered. "Painful choices" must be made, and they will be made, with or without the concurrence and agreement of the People.

"Entitlements" are to be "trimmed." The People be damned, and bless the increasing poverty that will result.

For the poverty of the many is believed to be necessary for the ever-expansion of the wealth of the few.

As we know, with the collapse of Communism, there are no longer any intellectual or moral barriers to the impoverishment of your Granny or your children's early deaths from preventable diseases. These are instead considered tonics to the moocher and dependent classes, goads to get them off their lazy asses and into some productive toil.

That the employment market has collapsed along with the bubbles that had been inflated over and over again is beside the point. Oh, there is plenty of work to be done, to be sure. Simply rebuilding a portion of our corroded and collapsing infrastructure would lead to full employment in a trice, but it wouldn't necessarily benefit Our Betters sufficiently to be worthwhile -- to them--  so it isn't done. Doing something globally about global warming and climate change could easily employ the entire population of the Earth and then some, but if Our Betters can't see sufficient profit for themselves in the endeavor, it won't be done. And "sufficient" unto themselves is Everything, much as the entire profit from the productivity increase over the last 40 years has gone into the pockets of the Overclass.

Social Security must be "trimmed" -- not because of any deficit in the program or in government finances, but because it benefits the Unworthy. That is the sole reason to cut Social Security benefits. Much as Medicare benefits those who Don't Deserve It, and so Medicare eligibility must be restricted (by raising the age of eligibility, much as Social Security eligibility has been restricted via raising the age of eligibility to collect full benefits. As an aside, commentators may want to get up to date on that age: it is not 65 for current retirees. It is 66 and some months. Soon enough it will be 67. It hasn't been 65 for years.)

Medicaid of course solely benefits the Unworthy and should therefore be slated for elimination.

All because of Moochers.

It's long past time to jettison this paradigm.

Overwhelming majorities of the American People oppose further cuts in Social Security and Medicare. Yet Our Rulers are poised to cut them anyway -- and perhaps they are even more inclined to do so because of public opposition. Governing contrary to the will of the People has become institutionalized in American government, and the more public opposition there is to neo-liberal programs (such as cuts to the social safety nets) the more the Ruling Class feels emboldened to pursue and enact policies contrary to the public interest and the public will. (Cf: Greece for a grotesque example.)

Apparently the only way to stop this is to... put a stop to it. So far, the People haven't figured out how to do that.

But the People will. They always do...

The Blankfein Thing

This has gotten much play in the Haute Blogosphere for many days now:

BLANKFEIN: You’re going to have to undoubtedly do something to lower people’s expectations — the entitlements and what people think that they’re going to get, because it’s not going to — they’re not going to get it.

PELLEY: Social Security, Medicare, Medicaid?

BLANKFEIN: You can look at history of these things, and Social Security wasn’t devised to be a system that supported you for a 30-year retirement after a 25-year career. … So there will be things that, you know, the retirement age has to be changed, maybe some of the benefits have to be affected, maybe some of the inflation adjustments have to be revised. But in general, entitlements have to be slowed down and contained.
PELLEY: Because we can’t afford them going forward?

BLANKFEIN: Because we can’t afford them.

Jeebus what a freak.

The notion that this mook should be lecturing anyone on matters of what we can "afford" and "fiscal cliffs" and so forth is surreal and insulting. His own sense of entitlement (and his bone ignorance) is unlimited.

Perhaps he would do well to contemplate just how close he and his ilk are to a ride in a tumbril before he and they mouth off again.

So...?

It appears that the upshot of the "election" is that the masses will be further ground down to satisfy the insatiable appetites of the metastasized financiers, their handmaidens and their hangers-on.

Word has it that the president will go out on the hustings to sell his plan to reduce benefits for the poor, the sick and the old in an effort to get the "other side" to agree to a minute increase in the tax liability of the highest of the mighty.

Of course the H & M won't agree. This has been made clear over and over again: Our Betters simply refuse to pay any more taxes. They refuse to pay the absurdly low taxes they are obligated to even now; all they will pay is what they choose to pay, and they will direct the use of that tax money as they see fit. Period. End of discussion.

The social contract has been broken, irrevocably.

The question is, what do we do about it?

The key to understanding is that elections are not how these matters are resolved. Elections may or may not provide a modest amount of guidance to the ruling class about how to proceed with programs and policies they have already determined to implement, but they are not the way those policies and programs are determined in the first place.

In our case at the moment, the ruling class has decided that it will implement policies and programs which will further squeeze the poor, the sick, and the old, while simultaneously reducing the living standards of the working class and significantly reducing both the numbers and the living standards of the middle class.

This is now Doctrine, agreed to by all the "serious" political factions, regardless of party identification or ideology.

Those least able to will be forced to pay. Forever.

We see the results of the implementation of this policy and these programs in Europe, starkly and with a kind of awful ugliness we didn't think was possible even a few years ago. People are going hungry in Europe's "periphery." They lack many basic services and care. They are unemployed and unemployable in their own countries because their economies have been looted for the sake of a handful of a financial sector run completely amok. The results are painful and obvious, and Europe's elected leaders do not care. They see their future is secure only through adherence to the dictates of the out-of-control financial sector. The People and what happens to them do not matter.

The People, for their part, have complained more or less loudly, and massed and marched and carried signs, sometimes even battling with police, but they have not reached the point of rising up to overthrow their exploiters and oppressors. No, it appears that that phase of human response to adversity is gone, vanished into the mist.

What we see instead is a response tailored to the People's immediate needs for succor and sustenance, sidestepping the apparat that has been deployed for their suppression. Much as has happened in the United States in response to the calamity of Hurricane Sandy -- "The Storm" -- the People have spontaneously adopted the practice of Mutual Aid, and are acting on behalf of one another quite apart from the bureaucratic mills of the corporate state.

It's a wonder to behold.

In addition, there is a surprising awakening to the fact that certain limited interests are profiting mightily -- and expect to profit much more -- from the nearly universal governmental obsession with austerity policies in the midst of an economic disaster of global proportions.

Some people are getting far richer than even their wildest dreams through the implementation of economic austerity programs and policies, and that is why they are being pushed so strenuously in the corridors and halls of Power.

So in the midst of this, there's one of the most magnificently tawdry sex scandals in our long history of of them. Hm. What could be going on? Certainly not a  distraction from what is important? Certainly not that!

Sex scandals tend to be ginned up to distract the Palace courtiers from otherwise productive tasks. In this case, the tawdriness of the cat-fight over the General(s) is matched by the delicious irony of the rightist "moralists" (apparently) doing in not just one of their own but the very star of their ongoing Morality Play. Of course what's apparent may not be what's true, so I'll withhold any judgement about what's really going on. I don't know. But for now, it looks like the Scandal has the media courtiers and not a few of the governmental and military ones fully engaged.

The fact that this is happening just as the Pretend Liberal Candidate was re-elected and plans to go on a campaign to sell his version of austerity programs and policies leads me to wonder whether there isn't some design and intention behind the events.

In other words, by keeping the courtiers engaged in Scandal Watch all sorts of mischief can take place under, around, and over the radar. The mischief of which I speak, of course, is the economic sales-job that is underway as we speak.

My prediction is that this Mother of All Sex Scandals will last just as long as it takes to implement the economic policies that have been waiting in the wings for just the right moment. And then it will be over as if it never happened at all.

Don't be too surprised if His Divinity St. David Petraeus winds up on the Throne just the same.

Oh what a tangled web...

So Actually, We're In The Same Place We Were Before the "Election"

An interesting result, to say the least.

We still have a chaotically gridlocked Congress, with the House in the hands of the renegade radical Republicans, the Senate in the hands of their Democratic enablers and a re-elected centrist-compromiser in the White House -- who is ritually disparaged as a Socialist by his rightist political opponents.

In other words, nothing has changed.

That of course doesn't mean that nothing will happen. In fact, all the signs point to some serious squabbling behind the scenes regarding how best and how quickly to extract more from the groaning masses through benefit cuts, tax and fee increases, and required expenditures for governmental and private services (ie: ACA).

There is no debate about the objectives themselves, only how quickly and how unmercifully to enforce them.

Rs want to go balls to the wall, forcing as much pain and suffering on the masses as possible in the shortest possible time while the Ds want to take it somewhat slow and easy, but there is no faction in among the Power Elite which was re-confirmed in office to abandon this program of mass suffering and try something else.

That means we are so screwed.

And that's what the People voted for -- well, some of them. Looking over a sampling of statistics, the turnout for this election was shockingly low in many precincts, under 50%. Was there a boycott? I'd like to think so, but without a public statement regarding such a thing, it's more likely people just weren't interested in the long lines and the hassles on voting day as well as the fact that neither candidate was offering anything substantive to the common people, only more benefits to the rich and well-connected.

I noticed this in the summary of political ads on the news. Rob-me had a definite program in mind which he mentioned in many of his ads, focusing on jobs (but he wouldn't say how he would increase employment), lower taxes for the rich, and reducing or eliminating regulations on employers, resource extractors and financiers.

You may not like the policies, but it is a policy program. Obama on the other hand seemed to concentrate on abstractions, what might be possible one day, and how to set the stage for the New America of the Future. He did not offer a policy program as such but instead focused his attention on ideas for doing something someday.

Obama's approach was rather soft and soothing but it lacked definition. Romney-Ryan on the other hand were cold and harsh -- though defined.

Neither appeared to be the least bit interested in the real issues the public faces, though both put on game faces of pretense. Romney for his part at least made "jobs" the centerpiece of his campaign. Obama barely mentioned the j-word.

They were both focused on the needs and demands of the Plutocrats.

That's where we were before the election, that's where we are now.

Nothing has changed.

Maybe after Barry and Mitch sit down together and have a good long heart to heart...

LONG LIVE THE STATUS QUO!

The Problem With Versailles

is that the People are nothing more than annoyances -- if they exist at all in the minds of the Nobles.

This is particularly true in the case of what passes for the economy, particularly with regard to the Sage Wise Men who profess to be Economists, the High Priests of the Cult of Greed.

In fact, what they are are shills and handmaidens and water carriers for the Nobility. They do nothing except they flatter their Betters and provide them with "moral excuses" for their rapine and destruction of the rest of humanity.

A new video series is being worked up over at Econ4; Ché say: "Check it out."

Frau Merkel's German Europe Projekt

They say she's looking tired lately. I wouldn't be surprised, what with all these EuroFinance Disasters to wrangle year in and year out. But for the life of me, it seems the whole roller coaster ride over there is just careening from one crisis to another -- actually always the same crisis, the banks are running dry of capital again -- and Merkel is riding in the lead car screaming. In other words, apart from the thrill of the ride itself, does she have any idea what she's doing? Or trying to do?

According to Anatole Kaletsky who writes for Reuters, Merkel is embarked on the "German Europe" Projekt, the same project that engaged Germany in some unpleasantness during the 20th Century, as some still alive may recall.

If that's the right analysis, then Germany and Europe and the rest of us have a Problem of which the extractions demanded from Greece, Italy, Spain, Portugal and Ireland (so far) are only the beginning.

The German Europe Projekt as been a fundamental problem of Europe for some 1,800 years as the Alemanni tribes and their precursors and successors spread over the European heartland and beyond, replacing -- in a manner of speaking -- the (Celto-Roman) social and political structures they found in place with their own. 

The Project has been going on ever since generally accompanied by a good deal of unpleasantness indeed.


So here we go again. At least to all appearances.


The question Kaletsky raises -- which has been raised over and over again in these seemingly endless struggles -- is whether the rest of Europe will be able to resist the March From Berlin. Kaletsky suggests the following course:

...At next week’s summit, France, Italy and Spain can turn the tables on Merkel by presenting her with an ultimatum: Led by President Hollande, who has abandoned President Sarkozy’s Gaullist pretensions of parity with Germany, the big three Mediterranean countries could agree on a program that really might save the euro: a banking union, followed by jointly issued eurobonds and backed by ECB quantitative easing. If Merkel tried to block these policies, the others could politely invite her to leave the euro, since Germany’s political pressures evidently made membership impossible on terms its partners could accept – essentially the proposition Merkel put last month to Greece. Without Germany, the euro zone would have much smaller internal imbalances and much more political coherence, with a much weaker currency and higher inflation, both of which would make debts easier to resolve.

In other words, Germany is the problem, Germany is the roadblock, and Germany under Merkel is thwarting any effort to resolve the economic and financial problems of the Eurozone, blocking every move toward a solution, and demanding ever greater levels of sacrifice on the Periphery in order to maintain German "integrity."


It's wrong and unfair to blame it all on Frau Merkel; after all, she has her constituents to consider, and though her party is losing seats in the state parliaments and the Reichstag... er  Bundestag... heh heh... she is still Reich Chancellor... er... and must represent the interests of the German Volk, ja? So a struggle between the interests of Germany on the one hand and everyone else in Europe on the other is simply a matter of each asserting their own rights and privileges, right? A family squabble, eh?


Well maybe not. 


If as it seems Merkel is pushing the German Europe Projekt once again, trampling on the rights and privileges of the rest of the family as it were, then there's something else going on. 


This looks to be an effort by Germany to dominate Europe, this time without troops perhaps, but with nearly as much deliberate and imposed suffering on the subject peoples as ever there was.


Ultimately, there will or there won't be a German Europe. Frau Merkel is intent on pushing her advantage to the limit of the rest of Europe's endurance and beyond, and in this, she is backed to the hilt by the global banksters; the German Europe Projekt is as much their creation as it is that of Germany itself. Americans may feel that they are on the sidelines, but I wouldn't be so sanguine about it. What happens in Europe, just as what happens in Latin America, in the Middle East, in Asia and in Africa, affects what happens here in ways we can't always anticipate or prepare for. 






And don't forget, the ice is melting...

The Obama Problem (Repost)

[I wrote this during the Debt Crisis Crisis. While I usually don't repost things from the past, it seems to me that Mr. Obama is struggling in the political arena once again, largely because people are dissatisfied with his performance on economic matters. The problem is his continued devotion to Hooverite economic principles. That's not to say that FDR and the New Deal were necessarily all that much better in an academic sense. They were far better in a political and popular sense. FDR understood the necessity of politically popular programs and policies, regardless of whether they were scientifically or academically sound; Hoover not so much, and not because he was such a bad man, or because he believed in "doing nothing" with regard to the economy -- neither was true about him.

No, the difference between Hoover and FDR, I think, was largely due to the fact FDR spent his entire adult life in politics and he came from a politically well connected and highly astute family. Hoover, not so much. Hoover was more of a bloodless technocrat, and the difference showed.

In the present case, of course, Romney has got Obama beat in the bloodless category. But Obama is obviously flailing as he goes around the country promoting economic policies that have actually resulted in an astronomical increase in unemployment and poverty. The People's answer is going to be, "NO!" There's no way around it.

The following essay written last July speaks of Obama as man of Principle whose primary Principle is that of Transcendence. And he will stick with it no matter what.]

The Obama Problem

I have from time to time offered both criticisms and defenses of His Serenity, Barack "Hoover" Obama -- mostly critical observation of what he is doing and why I think he's doing it. I don't think he is particularly evil or smart for that matter, but I do see him as increasingly self-possessed, self-actuated, and increasingly rigid in his core principles and beliefs.

President Carter with better looks and no Southern accent.

Well, yes. The Carter comparison has been raised since forever, on the presumption that Obama would be a one term president -- which he might well be, and I don't think he really much cares about that.

But lately, the fashion mavens in the Blogosphere have decided to push the notion that Obama is somehow The. Worst. President. Ever. (Excuse me, no.) Aware observers are more than willing to point out that the premise itself is stupid and unworthy, but it's hard not to succumb to the silliness because it is based in a human need to be on a "team" and support or defy the conventional wisdom.

Someone who supports his team feels validated, especially if his captain wins the game. And one thing I can say about Obama -- which I have in other fora -- is that he is a true believer in his own principles and his abilities to institute them through his agency as President.

His primary principle is that of Transcendence. He believes, truly, that it is his role to transcend the partisan divide, to bring the parties together, if not in harmony at least in agreement that something must be done and can be done, and to help hammer out whatever deal is necessary to Make It Happen.

That's what this Debt Crisis Crisis is all about. And it is -- sort of -- looking like he might pull it off.

Meanwhile, I came across a couple of considerations of The Obama Problem today that I think help clarify the picture. The first, via Digby, is by Michael Tomasky at the Daily Beast, and it is very good. The upshot is that Obama is doing what he is doing -- which often seems incomprehensible to observers -- because he really believes in the principle of transcendence and he is determined to stick with his principles no matter what.

He apparently really believes—still!—in civic-republican notions of government as an arena for reasoned deliberation. That he could still think this is akin to a child believing in Santa Claus until he’s 15—but apparently he does. The journalist Alec MacGillis captured this conviction well in a profile he did of Obama for the British New Statesman back in 2008. Barack Obama, he wrote, “was running not on a record of past achievement or on a concrete program for the future, but instead on the simple promise of thoughtfulness.” From this perspective a unilateral action would be almost impious—or at least, if you’d rather aim a little lower than God, anti-Madisonian. Obama would be giving up on his ideal. Of course he should have long since given up on it. I was with him at the beginning—his conviction that politics could be better and more deliberative was one of the things I found appealing about the man. But that ship sailed long ago, and Obama’s position has declined from admirable principle to indefensible fetish. Politics simply isn’t going to get better and more deliberative any time soon.
The third reason the president probably won’t do it is related to the second, but it’s more personal. Unilateral action would be at odds with Obama’s image of himself. In his article, MacGillis defined thoughtfulness Obama style as “the notion that the leadership of the country should be entrusted not on the basis of résumé and platform, but on the prospect of applying to the nation's problems one man's singularly well-tempered intelligence.” This is pretty obviously a dead-on description of Obama’s view of himself and his potential as president.

I think it is really a good description of what is going on. Of course Tomasky, like many others, is OUTRAGED!!!!™ and wants Obama to Stop This Nonsense Right Now!!! Yes, well. Good luck with that. At no point during his reign on the Throne has Obama shown even a hint of giving up his principles -- though he will cheerfully give up just about everything else.

The other Worst. President. Essay I read today was by Sterling Newberry via Ian Welsh. Sterling, gosh, goes back a long way, into the mists of Internet times, and he's always been an acute observer and analyst of what's happening. In today's essay at The Sorcerer's Apprentice he examines what is wrong, desperately wrong, with the Obama Reign, and I think he gets it mostly right.

I especially like his historical notes and this part:

The President who Obama most resembles is Herbert Hoover, another one of those chief magistrates of government who became inflexible and iron willed. His idea of compromise is that he cuts out what he thinks is a compromise, and then relentlessly grind on it. He's dealing with people whose idea of compromise is a woman having an orgasm while she is raped. Neither of these two sides have actually compromised very much, other than compromising on extending the Bush tax breaks for the wealthy.

Hoover was a malfortunate president. Unfortunate is not a sufficient adjective to describe it. He inherited an economy that was about to explode. He takes office in March of 1929, the move to January would, to no small extent be because the long gap between election and inauguration paralyzed the country when later he would lose the Presidency, and in October of 1929, the stock market plunges in what is know as "The Crash." In reality such a crash was essentially inevitable after the Olmstead Break in August. In effect he had 5 months of Presidency. The rest was a long grind and heavy flail. His response was not without compassion and, within his understanding, he worked hard to do what was right. He simply was a mammoth in a lake that had been swamped by a breaking glacier dam, to be found, frozen, as an oddity. His failure was that as his policies failed, he doubled and tripled down on them. In essence, he turned a single large downturn, into three back to back downturns, and left the very faith in capitalism and democracy bruised behind him.

FDR and Hoover had once been political friends, but his rants and threats, the most famous being his offer to let FDR be President early, if FDR would scrap the "so-called New Deal." FDR replied tartly that he was still a private citizen until inauguration, his term as Governor of New York having ended.

Like me and a number of others, Newberry is relating Obama to Hoover's presidency, and he explains why very well.

On the other hand, when it comes to the Debt Crisis Crisis, I think he is somewhat off the mark in that he doesn't seem to be able to relate it (or actually much of anything Obama has done) to Obama's principle of transcendence.

That's why I highlight both articles today: the one by Tomasky which gets into the underlying reasons why Obama is doing what he is doing -- though Tomasky is calling it wrong in all kinds of ways -- and Newberry's, take which relates Obama's actions with those of other Worst Presidents and takes him to task for missing so many opportunities to please The People (and his more leftward critics) by taking bold(er) and more authoritative/authoritarian action.

I honestly don't think Obama is doing what he is doing for political gain. He is doing it both because he can, and because he must. He is a believer, in other words, and a man of Principle. Unshakable Principle.

This is what Principled Governance looks like. It isn't pretty. And I don't think it is what we really want.

Full Employment and Enforced Savings = No Economic Depression Without War

Great illustration from the 1930's and a pretty good article to go with it.

The insight that it was possible to have full employment and enforce savings without war seems to have occurred to some policy makers as part of the post war planning that went on in the higher reaches of government in the 1940's during World War II and even into the early 1950's as the Korean Conflict raged, but the lesson never really took.

Part of the problem was that Republicans in Congress and their owners and sponsors would not have it. Full employment at decent wages was a threat to the capitalist class, always had been, and so had always been avoided until the necessity of employing everyone who could work became unavoidable in 1941. The fact that so many had to be employed, and that all of the civilians had to be paid decently under decent working conditions (for the standards of the era; it was gross exploitation by modern standards) was only ensured by law.

A large segment of working class men was absorbed by the military during World War II, and there would continue to be a significant fraction of young working class men absorbed into the military so long as there was a draft. During the War, the draft service was required for the duration of hostilities plus (I believe it was) six months; afterwards, the draft took young men for two years. The principle was supposed to be Universal Service, as in WWII, but in practice, even during the War, most men remained civilians.

Full employment or nearly full employment after the war was maintained largely through government contracting with private industry. Government did not employ the workforce directly to maintain full employment, it contracted with civilian employers for goods and services; private employers hired most of the workers at any given time. This practice was based on historical precedents. The Governments of the United States and the various divisions thereof historically contracted out much of their necessary activities, and typically contracted all their infrastructure and other capital programs. The government contracting practice was notoriously riddled with corruption and beset with scandal. The regulations and standards put in place prior to, during, and after WWII cut back on much of the corruption, while policies adopted in Washington and state capitols vastly expanded the Government's ability to contract for goods and services and to expand its own workforces to accomplish non-military ends and objectives.

The system worked relatively well until the mid-to-later 1970's when it started breaking down, and by the 1980's it was being overhauled and/or eliminated on a massive scale and that process has led directly to where we are now.

We can look back and comprehend what happened: the rebellions of the 1960's, the defeat in Vietnam, the oil-price shocks of the 1970's as consequence of Israeli military advances, and the advent of Ronald Reagan's "Morning in America" in 1980 which posited that government was the problem not the solution.

While these events provided the basis for dismantling previously very successful full employment policies, those policies themselves had been deeply resented by the capitalist and rentier class from the outset.

Any policies which benefited the working classes were resented and fought bitterly.

Of course over time any policy can be rendered obsolete. What happened to the full-employment policy, however, was something else again.

The problem was that the People rebelled -- or enough of them did -- to undermine the policy and eventually to literally reverse it. Now the policy is to maintain historically high unemployment rates indefinitely. This not only has the salutatory effect of forcing down working class wages and benefits, it causes many people to leave the workforce altogether. What they do to survive is something of a mystery, but a fraction turn to various forms of criminal activity, which when prosecuted and convictions secured can turn into a profit center for the civilian sector through privatized prisons.

The public elementary, secondary and higher educational system that was once the envy of the world has become a rickety, over administered, under-funded mess that is being successfully challenged by a largely publicly funded charter school and private "college" system that has the additional salutary effect of placing students in perpetual debt should they seek a degree.

In fact, debt-peonage has become a feature of the modern financial system, something that was once abhorrent to Americans. But since it is nearly impossible for one income earner to provide for a family any more, and even two incomes in a household are inadequate for a modest lifestyle in many cities, ever increasing household debt has become commonplace.

Full employment at decent wages would help ensure that debt would be a trifle rather than a major burden for Americans, and a fully funded, lightly administered public education system would help ensure that its graduates are not burdened by perpetual debt as well.

There's an absurd myth that "government doesn't create jobs" only private industry does. It's not even a pious fraud, it's an outright lie. Government is a primary job creator, even under the reactionary regimes we are faced with today.

The only question is, cui bono? And if that's you and me directly and not the High and the Mighty, then our government is set up to ensure that we don't have it.

My early suggestions when the first signs of the Endless Recession emerged were to 1) provide substantial household debt relief, to the tune of $80,000 to $100,000 per household; this would have had the same effect on the banks' bottom lines as the trillions that were given to them directly, but it would also have boosted the financial position of the average household, and for some reason still not clear, "we can't have that." 2) engage in a real jobs program, providing employment to everyone who could work and needed a job, at fair wages and benefits, doing necessary work on behalf of the People; 3) end the grossly overfunded and unnecessary imperial wars of aggression.

I'm convinced this program would have had a net positive effect, essentially ending the Recession within a few months, whereas the policies that have been adopted have perpetuated the Recession for the vast majority of Americans while providing ever larger financial rewards for those at the very top. At the same time, the risks to the economy as whole grow exponentially because it is more and more dependent on perpetual war and the accumulated wealth of the Highest of the Mighty.

We the People don't seem to have any influence on the policies of Government, no matter how skilled we may be in Changing The Conversation. Austerity is still the policy, and austerity is producing the results we see everywhere. The policy is wrong and deadly, but pointing it out will not change it.

The only thing we can do that may eventually change the economic situation for the vast majority of Americans for the better is to withdraw.

And that will be the next episode in this series...

How We Got Out of the Depression and Why US Poverty Rates Are At Historic Highs And Are Likely To Stay There

World War II.



No, our friend Franklin Delano Roosevelt was no great Keynesian when it came down to brass tacks as they say. He was more of a Hooverite. And during the 1932 campaign, Roosevelt ran to Hoover's right on economic matters. "Balanced budgets" were just as much of a fetish then as they are now. This was typical Democratic dogma at the time, and it never really changed, despite the fact that the Rooseveltian approach to Hooverite economic ideology was more flexible, shall we say, than Hoover's was, and to put a finer twist on it, Roosevelt was somewhat more interested in calming and managing the masses (using the hope of reward "one day" -- ie: Futurism) than was Hoover, whose sole economic interest was taking care of the upper-uppers.

World War II changed everything in ways that could neither be anticipated nor initially controlled.

The first noticeable big change was that it put everybody to work -- either in the military or in civilian employment supporting the military. Hiring began in 1940, before the United States entered the conflict, and the pace of hiring and drafting Americans increased through the end of 1945.

The second big change was that though pretty much every American who could work and wanted to was put to work during WWII and was paid for their work at a reasonable though hardly lavish standard, there was little for them to buy with their earnings, and necessities were rigidly price controlled.

In other words, though everyone was working, employment didn't at the time translate into a civilian consumer economy because there were so few consumer products available. Most of what was being spent was being spent by the government in pursuit of victory in war, thus most production was being promptly destroyed and replaced in warfare. For civilians and military alike, this was a situation that enforced savings. Troops and civilian workers were encouraged to buy War Bonds and hold them for the duration which they did. This meant that at the end of the war, many Americans had much more money in their pockets than they ever imagined and could not have possibly earned during the Depression.

A consumer economy was born out of these savings, particularly a post-war housing boom and an automobile boom, both of which essentially continued with only mild and occasional set backs until recently.

The War provided the twin factors of full employment and enforced savings that pulled the United States out of Depression. The unfortunate lesson learned from this experience by Our High and Our Mighty was that the way to prevent Depression in the future was to engage in perpetual war -- even if it was only Cold War.

The point of engaging in universal service and perpetual warfare, however, started getting lost during the 1970's in the aftermath of the Vietnam debacle.

Soon enough, the entire premise of the Cold War era would evaporate along with Our Bounden Enemy, the Soviet Empire. There are many reasons the Soviet Union collapsed; Ronald Reagan's "Brilliant Strategy" was probably the least important of a multiplicity of internal factors that were essentially built in to the Soviet system. In the Soviet collapse, Americans unknowingly got a preview of the coming collapse/transformation of their own rotting economic and political system.

The principal error after WWII was the rather dumb assumption that "war prevents economic depression." That's what experience showed to The Powers That Be, and so perpetual war was established as policy after WWII, carried out on the open battle field in Korea and Vietnam among other places. But the Cold War with the Soviets -- and to a much lesser degree with the Chinese and the Cubans -- was the endeavor that was meant to keep the wolves from the door.

One wonders what would have happened if the lesson learned had focused entirely on the civilian aspects of full employment and enforced savings instead of being diverted into perpetual warfare?

For we are now living with the consequences of that diversion, the apparent "victory" over the Soviets notwithstanding.

Having "won" the Cold War, the US had to have another Existential Enemy to fight in perpetuity, or there apparently would be no point in going on... Depression would return...

The Existential Enemy was found, of course, in the nefarious terrorist threat that stalks the land, but even with throwing in a few Imperial Wars of Aggression, Fighting the Terrorists doesn't provide nearly the economic boost that WWII and the Cold War did. These current wars are more of an economic drag instead.

They are a drag on the economy because they don't lead to full employment and they don't enforce savings.

It appears that Our Leaders have never learned that full employment and enforced savings are what pulls us out of economic depressions, and they are the major factors in preventing them, not warfar for its own sake.

Instead, they are practicing just the opposite -- conducting overseas wars and expanding the US National Security State with the least employment levels possible while preserving a consumer economy through ever higher levels of household debt -- or its contrast, forcing ever more millions of Americans into bankruptcy and poverty.

Not only is the United States back in Depression, we are in an economic Depression that there may be no rational/peaceful way out of if it goes on much longer.

This is a Depression that is enriching a handful of hyper-billionaires in ways most of us never dream possible primarily through gambling and financial hocus pocus in a rigged house, a casino that's rigged against the People. Even when they lose the bet, the hyper-rich get paid off by the rest of us.

It's the most amazing thing.

The more impoverished the rest of us become, the richer the handful at the top grow.

Unemployment rates remain at historic levels; poverty rates are growing to post-WWII highs. This is not due to some accident of the market, it's due to policy. As of late last year, half of Americans were classified as very poor or near poor, and more were being pushed into their ranks day by day as unemployment and the reduction of wages and benefits, with no concomitant reduction in cost of living, take their toll.

Meanwhile, public services and the public infrastructure deteriorate at an alarming rate.

Not only are the People falling into poverty, so is the public sector in general. The fall out from this Endless Recession and the contraction forced onto local and state governments will have a lasting effect, even if, eventually, someone who can do something about it gets the bright idea that it doesn't have to be this way, and the course can be reversed in a twinkling.

The longer we wait for that reversal, however, the harder it will be, and the more dangerous it might become for children and other living things.

There is the potential to make lemonade out of these lemons, however.

By adopting principles of voluntary poverty, for example, and by decoupling from the consumer economy that is still sputtering along, Americans have the opportunity to explore and reclaim the Better Future on their own terms rather than on terms set by Masters of the Universe and by a system of exploitation and destruction.


[To Be Continued...]