At the risk of counting chickens before they hatch, what would the return of Team Blue portend?
As is patently obvious, the US is in trouble. Climate driven heat waves and fires grip the nation. An already faltering economy with deep contradictions could only tank given the shock of the pandemic that has necessitated varying degrees of sequestering. In fact, the downturn had already started before COVID-19 hit. An already largely privatized healthcare system run for profit and a social ethic that rejects “socialized” public health measures could only have proven inadequate. Added to this mix, an historically racist nation was ripe for the righteous protests against overt injustices. These conditions pre-dated Trump’s presidency and predetermined the current calamity.
The designated chump is Trump
Trump is screwing up royally, but the root causes were unavoidable. Rather than owning up to the inherent nature of capitalism, which puts profits before people as its operating principle, elite opinion needs to point a finger at an offending scapegoat. Someone must take a fall and the designated chump is Trump. Witness Republican establishment figures defecting to the Biden camp.
Trump, under normal circumstances, would have a formidable advantage as the incumbent president. Of the thirteen US presidents since 1933, all ran for re-election except JFK who tragically did not have that choice. All but three won. These exceptions prove the rule that bad economic times doom the incumbent: Ford and Bush the Elder were defeated by recessions and Carter by “stagflation.”
Today’s circumstances are not normal. Trump’s incumbency may be a fatal flaw with conditions worse in many respects than the Great Depression.
Added to a collapsing economy and a nation aflame with racial justice protests, Mr. Trump has not improved his prospects by his mishandling of the COVID-19 contagion. A US passport was once the most accepted in the world. Now that the US leads the world in total pandemic deaths and ranks a high eleventh in deaths/population, only eight countries in the world are fully open to US tourists: Albania, Belarus, Brazil, Mexico, Serbia, Turkey, Zambia, and that most sought after destination of North Macedonia, whose national flower is the opium poppy.
The delusional fear that Trump will stage a coup to stay in power begs the question of what army and security apparatus would back him. Not the US military, nor the security state agencies – FBI, NSA, CIA and other spooks. Those institutions of the permanent state are no more in favor of Mr. Trump than most of the active US electorate, who will likely give him a boot this fall.
The next act comes with perils
In the midst of the pandemic, when health insurance claims would be expected to be out of control, health insurers have been garnering obscene profits benefiting from the public health emergency. Amongst the superrich, Jeff Bezos of Amazon added $87.1 billion to his net worth since the beginning of the year and Elon Musk of Tesla accrued another $73.6 billion.
Thanks in large part to the habitual intervention by the Federal Reserve for the owners of finance capital, Market Insider predicts “2021 could be a boom year for stocks,” while prospects for working people look grim and ever grimmer. Yes, Bernie Sanders was right that the “system is rigged” for the capitalist class.
Will a Democratic victory in November change any of this? Speaker of the House Nancy Pelosi, the current highest ranking Democrat, said it all: “we’re capitalist and that’s just the way it is.” Her net worth is $120 million.
Even major “liberal” Democrats, such as Elizabeth Warren, are doctrinaire “capitalist to the bone.” When asked to explain herself, the senator said: “I believe in markets and the benefits they can produce…for people.” True enough. The “people” who benefit from capitalism are the capitalists.
How about Democratic Party progressives like the “The Squad,” you ask? In the “graveyard of social movements” that is the Democratic Party, they are relegated to diversity window dressing with AOC getting only 90 seconds of fame at the Democratic National Convention.
Nominal independent Bernie Sanders tried an end-run for the presidential nomination but ran into the DNC’s “no progressives rule.” And if Biden wins in 2020 and Harris in 2024 and 2028, 2032 would be the first chance for a progressive Democrat to even try to run.
Speaking of the Democratic National Convention, Bernie Sanders praised Uncle Joe for – of all things – his health care policies. Michelle Obama carried chutzpah to new heights, criticizing Trump for immigration practices inherited from her husband. Can’t the best speech writers that money can buy come up with more convincing mendacities?
The enduring neoliberal project will continue with a likely change of guard from one party of capital to the other in January, though with a kinder face. We won’t have to contend with Prince of Darkness Pence and his buddy anymore.
The new feel-good Democratic couple will be spreading the love. And no one is feeling the “good” more than the capitalist class, rewarding the Democrats with donations of $48 million in the 48 hours after the announcement of Kamala Harris as the vice-presidential candidate. Just about every mainstream media article gushed about her amazing “qualifications,” the foremost being fund-raising. In plain English, her biggest asset is she is understood as serving the capitalist class.
The record of Democratic presidencies
It may be too soon to exhale with a Biden White House. If past performance is any indicator of future outcomes, a brief look at recently past Democratic presidencies is advised.
Under the watch of New Democrat Bill Clinton, the Glass-Steagall Act was repealed, which was a factor leading to the Great Recession. NAFTA exported US union jobs while destroying small-scale Mexican agriculture. He dismantled Yugoslavia and bombed Iraq, contributing to the now perpetual destabilization of that part of the world. “Welfare as we know it” was abolished and mass incarceration instituted. Clinton was on a roll, with Social Security next on the chopping block, only to be stopped by the Monica Lewinski scandal.
While these were pet projects of the Republican wing of the US two-party duopoly, it took a Democrat to foist it on the populace. Notably, no major progressive legislation came out of Mr. Clinton’s watch. He adroitly felt “your pain” while inflicting it on the Democrat’s captured working class and minority constituencies, much to the pleasure of the class he served.
The next Democratic president, Barack Obama, had not even completed a term in the Senate before his meteoric rise to the Oval Office. Mr. Obama had the wiring, but part of his remarkable upward mobility came from being groomed and vetted by the ruling class to carry their water. He came out of the Brookings Institute’s Hamilton Project, which successfully sought to make the Democrats the favored party of Wall Street.
After promising peace, Obama led the US into wars in at least seven countries. Although no major progressive legislation came out of the Obama presidency, his many handouts to the ruling elites include bailing out the banks with no one prosecuted for wrongdoing. He gifted Obamacare to the insurance industry while killing single-payer. He more than doubled fossil fuel production for which he proudly took credit.
The lesson is that it is often more difficult to mount an organized resistance to regressive policies when promoted by Democrats than Republicans. Recall the massive resistance to Bush’s war in Iraq that instantly vanished the moment Obama inherited that war and brazenly took Bush’s Secretary of Defense Robert Gates into his cabinet. Similarly, we have seen Democrats sabotaging Medicare for All, with Biden already pledging to veto it if it came before him.
Campaign promises Biden will keep
The only thing preventing Trump from self-destructing come November 3 is none other than the Democratic Party. Of all the potential candidates that could have walked over Trump – particularly Sanders with universal healthcare in a time of pandemic or even Warren with taxing corporations in a time of record profits amidst a recession – they chose the one candidate who could lose.
Note that these dubious promises were made on the campaign trail, while trying to attract votes.
A Biden presidency – austerity at home and imperialism abroad
Pelosi set the stage for a Biden presidency. The first thing the Democrats pushed through after “taking back” the House in 2018 was the “pay-go rule,” a fiscally conservative measure virtually guaranteeing that no progressive legislation can be funded. Then in March of this year the Democrats unanimously and without any debate helped pass the CARES Act, the largest single transfer of wealth from the workers to the wealthy in the history of the world.
Trump has been all over the map, ineptly and inconsistently pursuing détente with Putin and while threatening Xi Jinping. With a Democratic administration, we can be assured of a more consistent, skillful, and lethal US imperialism, pursuing “full spectrum dominance” over the rest of the world.
Those who complain about Trump’s bungling should understand that the Biden alternative will be a more deadly and efficient rule of capital. We should be careful about what we wish for.
Dedicated to Soni Prashad, 1929-2020, who spent her life looking for a better world.
US President Donald Trump and his ‘war council’ – led by Secretary of State Mike Pompeo – have amplified their aggression against China. What began as a trade dispute in the 1990s has now escalated into the United States making an existential challenge against China.
The threat against China is made not for irrational reasons, but for perfectly rational ones, which are laid out below in our Red Alert no. 9 (also available as a separate download from our website). These have to do with the emergence of China as a major economic and technological power. What most rankles the US ruling class is that the various hybrid war techniques to weaken or overthrow the government are simply not available. The only means at the disposal of the United States to hold on to its power – chillingly – is armed force.
Red Alert no. 9. The US-Imposed Hybrid War on China
Is the United States trying to impose a war on China?
For the past several decades, the US has conducted a trade war against China. There are two key issues that worry the United States: first, a trade imbalance that benefits China, and, second, the growth of the Chinese technology sector. Techniques that the US has used against China include: pressuring China to revalue its currency against the dollar, pressuring China to prevent ‘piracy’ on intellectual property in order to slow down its domestic intellectual property developments, and pressuring China to slow down or cease its Belt and Road Initiative.
The US has now begun a war against the Chinese economy. The attempt to isolate Huawei and ZTE from their suppliers and their markets will have a debilitating impact on the growth potential of the Chinese economy. The US has sanctioned roughly 152 companies that make chips and other products for Huawei and ZTE. Increased bans – through the US government’s Clean Network initiative – would prevent US companies from using Chinese cloud services and undersea cables, and it would ban Chinese apps from appearing on app stores. The US government has increased pressure on other countries to join in this campaign.
The US government has increased its military pressure along the eastern rim of China. This includes the 2017 revival of the Quad (Australia, India, Japan, and the US), the creation of the US’ Indo-Pacific Strategy (its key document from 2020 is called ‘Regain the Advantage’), and the development of a range of new weaponry, including cyberweapons. This military power has come alongside hostile rhetoric against China, with attention focused on Hong Kong, Xinjiang, and Taiwan, and the depiction of the coronavirus pandemic as a ‘China virus’. Evidence is not as important here as the use of older racist and anti-Communist ideas to demonise China.
Liu Xiaodong (China), Wedding Party, 1992
Why is the US increasing its pressure against China?
China’s technological advances could result in a generational advantage over the West. China’s scientific and technological developments came because of the country’s investment in higher education and in its ability to transfer technology from firms that entered the country to manufacture goods. In 2018, Chinese scholars for the first time published more scientific articles than their colleagues in the US, and Chinese firms filed more patent applications than US firms. Chinese tech firms have now produced products that appear to be ahead of US, European, and Japanese products. Examples for this include 5G, BeiDou (a better mapping technology than GPS), high-speed trains, and robots.
Faced with US pressure, China has crafted an independent trade and development agenda. Since the world financial crisis, China began diversifying its economy from reliance upon the US and European markets to build up its own internal market and to increase engagement with the Global South. The immediate projects that developed included the Belt and Road Initiative, the String of Pearls Initiative, the Forum on China-Africa Cooperation, the Shanghai Cooperation Organisation, and the China-Community of Latin American and Caribbean States Forum. The Chinese government has also begun to pay more attention to the Association of South-East Asian Nations (ASEAN). These moves come alongside a remarkable poverty eradication programme.
Currently, China is highly dependent on imported energy – such as gas from ASEAN nations, Australia, and Qatar. The China-Russia 6000kms ‘Power of Siberia’ pipeline will bring 38 billion cubic metres of natural gas, a substantial increase to meet the demands for the 90 billion cubic meters consumed by China. In 2014, Russia’s multinational energy corporation Gazprom and the China National Petroleum Corporation signed a $400 billion for a thirty-year deal.
Increasingly, China has attempted to build institutions outside of Western-controlled trade and development architecture, including the Asian Infrastructure Investment Bank (founded in 2014). As part of this, China has committed to de-dollarisation; China has proposed to hold its reserves and to conduct trade in currencies other than the US dollar. This is a long-term but inevitable development, and one that threatens the overall role of the Wall Street-Dollar complex. China’s cooperation with Russia is most advanced in this arena, with about 50% of Russia-China trade conducted in roubles and yuan (Russia owns about 25% of the global yuan reserves). Both Russia and China are divesting themselves of their dollar reserves. In January 2020, Russia sold $101 billion, or 50%, of its dollar reserves and moved $44 billion into Euros and $44 billion into yuan. The yuan, however, represents only 2% of global currency reserves.
Against the eastward expansion of NATO and the emergence of the Quad, China and Russia have crafted a military and diplomatic Eurasian security bloc. This is evident in the arms deals and the military exercises, but also in diplomatic coordination. For example, Russian and Chinese foreign ministry spokespersons Maria Zakharova and Hua
Chunying said in late July that they would join efforts in combatting the information war against China and Russia. Chinese diplomats have taken a more forthright attitude in their statements; they have been dubbed the ‘wolf warrior diplomats’, an allusion to a popular film where a Chinese soldier from an elite Wolf Warrior troop defeats a group of terrorists led by an ex-US Navy Seal.
Clearly, the US has found that Chinese leadership has been unwilling to go the Gorbachev road – namely, to surrender the Chinese model to the will of the United States. There is no possibility that the Communist Party of China will dissolve itself. The Chinese middle class – possible fodder for a ‘colour revolution’ – does not have any appetite to overthrow the government. It is content with the direction of the government and sees that its government has improved living standards and has been able – unlike Western governments – to tackle the Coronavirus pandemic (as we write about in a series on ‘CoronaShock’). A Harvard University study shows that the government led by the Communist Party of China has increased its approval from 2003 to 2016, largely because of the social welfare programmes and the fight against corruption pushed by both the Communist Party of China and by the Chinese government. The overall approval stands at 93%.
Zhong Biao (China), Paradise, 2007
What contradictions does the US war project face?
Chinese economic developments – such as the country’s capacity to outspend the US in development aid to outbid Western firms in trade deals – has produced alliances between China and key capitalist sectors in countries that have otherwise been secure US allies. Examples of this are amongst sections of the capitalist class in the Philippines and Sri Lanka, where Chinese investment has been welcomed.
The Chinese state has intensified its intervention in the tech sector inside China, with a $14 billion private and public fund to support tech developments. Semiconductor Manufacturing International Corporation (SMIC) – China’s top chip company – had an initial public offering (IPO) in Shanghai which netted $7. 5 billion. As a consequence of such funds and its own scientific developments, China will soon be able to bypass the US chip firms.
China’s economic capacity continues to exert pressure on fragments of capital in different countries. For instance, Australian mining companies rely upon China to buy iron ore from Australia. These companies lobby Canberra not to take too hostile a position against China. Roughly one third of Australia’s total exports go to China; these include soy, barley, meat, fruits, gas, and the raw minerals. The Australian government is forced to acknowledge these concerns, even though it has a longer-term perspective than the short-term profit concerns of the mining conglomerates. China has already hedged its bets, increasing purchases of soy and meat from Argentina and Brazil, and it will likely buy more mined goods from Brazil (Brazil’s Vale is using massive ships to carry mined goods to China).
The US military is stretched thin between the conflicts in Venezuela and Iran, and now in China. The US Navy has had four secretaries in a year, part of the chaos in the Trump administration. As a consequence, the US Navy has complained about the lack of ability to handle so many theatres of war at the same time. China has developed sophisticated defence mechanisms, such as cyber warfare techniques that have the ability to shut down US communications, starting with their satellites, and such as their Dongfeng missiles, which are capable of hitting the US navy ships that are in the South China Sea.
The eighth century Chinese poet Li Bai wrote of the ugliness of war; as far as war is concerned, nothing has changed over the centuries.
Soldiers smear their blood on the dry grass While generals map the next campaign.
Wise people know winning a war Is no better than losing one.
To break the embargo on factual news on China, please subscribe to receive News on China from the Dong Feng Collective; these weekly digests are the best way to remain informed about developments inside the country.
The US ruling class has dominated the planet since the end of World War II. Key elements of this control include its military superiority in nuclear and conventional weapons, and the stationing of over 900 military bases around the world. In addition, the US presides over the United Nations, the International Monetary Fund (IMF) and the World Bank. It upholds the US dollar as the global currency, and it controls much of the world’s resources, particularly oil.
These factors provide the background to why the US can print, or create, billions and trillions of dollars, running up its national debt, now $25 trillion, yet endure little inflation. The reason for this capacity is only tangentially explained by Modern Monetary Theory. It results from the US position as the imperial superpower, which enables it to export inflation.
We have about 50% of the world’s wealth but only 6.3% of its population. This disparity is particularly great as between ourselves and the peoples of Asia. In this situation, we cannot fail to be the object of envy and resentment. Our real task in the coming period is to devise a pattern of relationships which will permit us to maintain this position of disparity without positive detriment to our national security. To do so, we will have to dispense with all sentimentality and day-dreaming; and our attention will have to be concentrated everywhere on our immediate national objectives. We need not deceive ourselves that we can afford today the luxury of altruism and world-benefaction.
In spite of losing its status as the workshop of the world, the US still enforces this “pattern of relationships” throughout the world. The role of the dollar provides an essential tool. As pointed out in Modern Monetary Theory (MMT) and the Power of the US Dollar in the World Economy, the dollar is the international reserve currency. Between 50-70% of trade transactions between nations are calculated in dollar terms even though the US accounts for only 11.5% of world trade. Most goods, particularly key ones such as oil and food staples are priced in dollars on the world market. It is the chief currency countries use for their central bank reserves, constituting 61% of the holdings. Of the international debt of the nations of the world, 63% of it must be paid in dollars. Close to all foreign exchange trading 88%, involves some currency’s exchange with just one, the dollar. About 70% of nations either directly peg their currency to the dollar, use the dollar as their own currency, or keep their currency in tight trading range relative to the dollar. Contrary to widely held belief, the US grip on the world economy has more adapted than weakened.
Since foreign countries price their imports and exports in dollars and have debts in dollars, they are dependent on the dollar and the value of the dollar. They remain vulnerable to rises in the exchange value of the dollar, as that interferes with their trade and causes the value of their debt burden to grow.
The trillions of US dollars that nations hold make these dollars a captive market for US Treasury bonds. As of April 2020, over 30% of US debt is owed to foreign governments. This percent has slowly trended upwards over time. Since essential commodities are priced in dollars, countries have to accumulate the currency to pay for their imports. The New York Times reported in 2019, “The dollar has in recent years amassed greater stature as the favored repository for global savings, the paramount refuge in times of crisis and the key form of exchange for commodities like oil.” This allows the US to run giant deficits and borrow on a vast scale with little constraint.
Why the Dollar is the World Currency
The supreme imperial power, the US, imposed the 1944 Bretton Woods agreement on the world, elevating the dollar as the world reserve currency. The US made other states peg their own currencies to the dollar, itself pegged to gold at $35 an ounce. At that time, the US held three-fourths of world gold reserves. The US was the only nation that could print the globally accepted currency. The agreement also created the World Bank and IMF, US-backed organizations that helped oversee the new imperial set-up.
Unsurprisingly, the US did not keep its promise to peg $35 to one ounce of gold, and instead printed more dollars than it had gold to back. The US used these dollars to fund social programs and war spending during the 1950s and 1960s. By 1971, gold was valued at a rate closer to $200 an ounce, causing Nixon to take the dollar off the gold standard.
Ironically, since then, the global role of the dollar has only increased. US has used its power – diplomacy, threats, blackmail, favorable deals, sanctions, tariffs, coups, and military invasion to enforce the dollar role as the international currency.
The Role of the Petrodollar
After Nixon ended the convertibility of dollars into gold, the US needed a compelling new reason for foreign banks and governments to hold dollars. Given the importance of oil to any economy, Nixon replaced “dollars for gold” with “dollars for oil,” black gold, through the petrodollar system. An oil-exporting nation’s rulers get military backing from the US, and in return must price their oil not in their own money, but exclusively in dollars. They must buy US Treasury bonds with profits of their oil sales.
In 1971 the US told Saudi Arabia that it could charge what it wanted for its oil but had to recycle dollars from oil earnings back to the US. It would be considered an act of war if they didn’t comply. The remaining OPEC countries soon followed suit.
Russia began switching to selling their oil in euros only last year. Venezuela and Iran have already moved off the dollar, but now the US uses cruel sanctions to block their oil’s access to the market. Qaddafi’s Libya and Saddam’s Iraq met a worse fate when they moved to stop selling their oil for dollars.
The US Market Remains the World’s Main Export Market
The US remains the biggest consumer market in the world, more than a quarter of world household consumption, amounting to $14 trillion in goods and services in 2018 (the equivalent of the European Union and China combined). Much of the Third World counts on the US market to drive their economic growth. These countries rely on cheap exports in order to keep their economy moving, so they cannot let their own currency rise in value relative to the dollar.
How theUS Uses the Dollar’s Role as International Currency to Export Inflation
When the Fed opens up its spigot of US dollars, over $10 trillion in the last 10 years, the US can engage in a global spending spree. Dollars travel abroad as foreign loans and investments, and to pay for more imported goods. Since world trade is largely conducted in US currency, the US can easily export the new dollars not backed by any increase in domestic production. This lowers the value of every dollar held around the world. It leads to rising prices abroad while bringing a net inflow of goods to the US benefiting the US consumer, but at the long-term expense of the countries exporting to the US.
When the dollar drops in real purchasing power, the nominal dollar price of commodities on the world market would go up, hurting vulnerable import dependent poor countries. The value of foreign currencies rises relative to the declining value of the dollar. The exports of Third World nations, generally valued in US currency, become more expensive, reducing their ability to sell their exports. A 2018 Harvard report points out the weight of the dollar in international trade: “A 1% U.S. dollar appreciation against all other currencies in the world predicts a 0.6% decline within a year in the volume of total trade between countries in the rest of the world.”
Countries on the receiving end of this Fed money-creating policy have two options. They can let the value of their currency rise relative to the new dollars entering their economy. However, a rising value of their own currency hurts their export industries, on which many Third World countries survive. The alternative involves their central banks printing more of their own currency to buy up the new dollars circulating in their economies. US dollars created out of thin air end up in foreign central banks after these countries print more local currency to buy them up. This pushes up their rate of inflation and increases the local cost of imports, particularly hurting the people’s standard of living in nations that import food stables and other basic necessities.
When countries must print more of their currency, this lowers the dollar price of their goods exported to the US. This helps to limit price increases in the US caused by the Fed creating dollars. Thus, when the Fed conjures up dollars on a large scale, other countries are subject to rising prices, yet help to curtail it in the US market.
China loosely pegs the RMB to the dollar and is now the second largest foreign holder of US debt. This serves to keep its currency cheap relative to the dollar and the prices of its exports competitive. China uses the dollars from its trade surplus to the US to purchase US Treasury bonds. This way, China has been rapidly developing and exporting by helping strengthen the dollar and lower the RMB’s value.
Secondary imperial powers like Canada or Japan, major exporters to the US, have more of an option of letting the dollar fall and allowing their own currencies to rise. This controls domestic prices, although it hurts exports, and would slow their economic growth. However, since they are already developed countries, they are more able to cope. Third World countries, relying on cheap exports to the massive US consumer market, cannot long tolerate such a hit. It would cause severe social and political difficulties, so they often must devalue their own currencies to stay competitive.
In sum, the US, the imperial superpower, has its hands on Aladdin’s lamp, and can rub it to create hundreds of billions, now trillions of dollars. The US gains by importing at reduced real cost, benefiting the US consumer, and in return sends its inflation abroad. In 2011, the Wall Street Journal noted this in The Latest American Export: Inflation. “What do the years 1971, 2003 and 2010 have in common? In each year, low U.S. interest rates and the expectation of dollar depreciation led to massive ‘hot’ money outflows from the U.S. and world-wide inflation. And in all three cases, foreign central banks intervened heavily to buy dollars to prevent their currencies from appreciating.” As the Head Economist of Commercial Banking of JPMorgan Chase wrote in 2019, “When foreign central banks stockpiled dollars, they effectively pushed up the purchasing power of American consumers.”
US Economic Control over Third World Economies
Third World countries generally do not possess the requisites of sovereignty: basic food self-sufficiency, energy independence or technological and industrial development. They must import these goods, not with their own currency, but with “hard currency,” a code word for the currency of imperialist countries. Nor can they borrow in their own currencies on the similarly misnamed “international” market and have to rely on “international” capital for their development projects. Consequently, they are reduced to borrowing “hard currency,” usually dollars, and must earn dollars to pay back these debts. They become stuck in a debt trap, subjugated to the US and the lesser imperial countries. The imperialist system is constructed to protect this neo-colonial operation.
The role of World Bank and IMF in enforcing Third World subservience to the US illustrate this.
The World Bank has one primary aim, and that’s to make other countries dependent on American agriculture. Its idea is to make Third World countries export plantation crops, especially plantations that are US or foreign owned.” The World Bank encourages exports of foods not grown in the US, and have them import US staples, such as grains. “The US demands foreign dependency on its grain, technology and finance. The purpose of the World Bank is to make other countries’ economies distorted and warped to a degree that they are dependent on the United States for their trade patterns.Essentially, the Bank financed long- investments in the foreign trade sector, in a way that was a natural continuation of European colonialism.
The IMF was in charge of short-term foreign currency loans.…The function of the IMF and World Bank was essentially to make other countries borrow in dollars, not in their own currencies, and to make sure that if they could not pay their dollar-denominated debts, they had to impose austerity on the domestic economy – while subsidizing their import and export sectors and protecting foreign investors, creditors and client oligarchies from loss.
The IMF “uses debt leverage as a way to control the monetary lifeline of financially defeated debtor countries. So if they do something that U.S. diplomats don’t approve of, it can pull the plug financially, encouraging a run on their currency if they act independently of the United States instead of falling in line. This control by the U.S. financial system and its diplomacy has been built into the world system by the IMF and the World Bank…”
Nations relying on staple food imports, such as US grain, are hurt when the US conjures up new quantities of dollars. When these lands must follow suit, working class purchasing power drops. Workers produce more for less, while those holding dollars receive more for less money.
Forbes pointed out in Fed Exports Inflation, Stokes Revolutions, in reference to what was called the Arab Spring, “The unrest in the Middle East has a lot to do with food and commodity prices, and Fed QE policies [printing trillions of dollars] may have a lot to do with those prices.” Most of these Middle Eastern states had become increasingly reliant on imports for food supply over the past half century. Rami Zurayk noted the high prices for basic food staples like grain led to social unrest across many Middle Eastern states in 2010-2011. “’Bread riots’ have been occurring regularly since the mid-1980s, following policies brought to us by the World Bank and the International Monetary Fund.”
Third World countries are driven to subsidize their export industries to gain the dollars or euros they need for their imports and for their international debts. This sabotages their economic modernization and national independence. Even an oil-producing state like Venezuela never had energy sovereignty, as it produces crude oil, but lacks the technological capacity to refine it, so depended on imports. Third World countries generally export raw materials and cheap low value-added content, and import high value-added content, advanced technology and capital goods. They constantly lose in the transaction. The system keeps them mired in a debt and dependency trap where they must prioritize export industries. MMT economist Fadhel Kaboub says over the last few decades, this has resulted in outflows of $600 billion every year from the Third World to the First.
The US Exports Inflation and in return the World Pays for the US Debt
When foreign central banks collect new dollars by printing their own money these dollars are not just used to pay off foreign debts. Countries are pressured into loaning their dollar savings to the US, buying Treasury bonds. The US debt continues to this day as the safest haven for countries to store their foreign exchange reserves, especially at times of international economic and political stress. In practice, this means they are driven to make loans to the US so that the US can keep buying their goods. The US government can run up debt by conjuring dollars out of thin air, to be spent on cheapened imports that prop up US consumer society. The foreign central banks recycle dollars back to the US Treasury to maintain their own currencies’ exchange rate with the dollar. This set-up keeps other nations lending the new dollars they gained back to help pay for the ballooning US debt. As Treasury bonds, these dollars are taken out of circulation, so create little inflation at home, although they previously did when the US circulated them overseas.
Through this scheme, foreign countries hold savings as dollar reserves and loans to the US, loans now beyond the ability of the US to repay. The US supports itself by sending paper IOUs abroad to buy other countries’ goods with these unpayable IOUs. Meanwhile, the US keeps its gold reserves intact and prices stable. Already half a century ago, European finance ministers had complained about this export of US inflation, to which Nixon’s Treasury Secretary John Connally responded the “dollar is our currency, but your problem.”
Let’s suppose that you go to the grocery store and you buy food and then sign an IOU for everything that you buy. You go to a liquor store, IOU. You buy a car, IOU. You get everything you want just for an IOU. But when people try to collect the IOUs, you say, ‘That IOU isn’t for collecting from me. Trade it among yourselves. Think of it as your savings, and trade it among yourselves. Treat it as an asset, just as you treat a dollar bill saved in a cookie jar and not spent.’ Well you’d get a free ride. You’d be allowed to go and write IOUs for everything, and nobody could ever collect. That’s what the United States position is, and that’s what it wants to keep.
Hudson adds, again simplifying it, “That’s what makes the United States the ‘exceptional country.’ The value of our currency is based on other countries’ savings. The money they save has to be held in the form of dollars or securities that we’re never going to repay, even if we could.” The US has established an international system requiring other countries to use the dollar, obliging them to stockpile them in the trillions, and coercing them to make loans to finance a US debt that will never be paid.
The US, protecting the dollar as the world’s reserve currency, is not subject to the same rules other countries are: it can spend more than it produces, maintaining its consumerist lifestyle, by simply printing more dollars. It can use this extra money to gain control of goods and resources, giving them inflation and debt in exchange. Since these exported dollars often return home through now uncollectible loans as Treasury Bonds, they do not remain within the US economy to cause rising prices.
This scheme the preserves what George Kennan delicately labelled the “pattern of relationships” that upholds the “disparity” of the imperial economic system. To enforce this scam, the US has built military bases throughout the world — much of this dollar cost returned to the US through the same operation — ready to act against nations seeking to get off the dollar standard.
Modern Monetary Theory (MMT) has become popularized by some of the liberal-left because it offers an explanation how to achieve full employment, national health insurance, free college education, and the Green New Deal without raising taxes. Political leaders like Alexandria Ocasio-Cortez and Bernie Sanders have espoused MMT. Economist Stephanie Kelton, a leading spokesperson of the theory, served as chief economic adviser to Sanders during his 2016 presidential campaign.
We summarize the basics of MMT on the significance of a “sovereign” currency and consider which currencies meet the conditions of being sovereign in the existing structure of the world economic system. This requires a review of the role the US dollar plays in world trade and how the dollar dominates the world trade system. For MMT, the existence of a sovereign currency explains the US capacity to keep pumping dollars into the economy and not experience inflation. In a subsequent article we address the validity of this last claim.
The Essentials of Modern Monetary Theory
The central idea of MMT states that a country that issues its own currency, a “sovereign” currency, can never run out of money or go bankrupt the way households or businesses can. Any government spending can be paid for by the creation of more money. Therefore, national government spending should not be determined by balancing the budget or limiting deficit levels, but only by whether spending is keeping the economy at full employment and at a reasonable level of inflation.
The US government, being a currency issuer, has its own sovereign currency, the dollar, just as Japan has the yen, and Britain the pound. The US, as the exclusive producer of the US dollar, can create more money whenever it needs. That is not the same for countries without their own currency, such as the eurozone nations which are shared users of the euro. In a similar manner, state and local governments in the US do not possess their own currency, and have to keep balanced budgets.
MMT states national government spending does not have to be paid for with taxes. It can print money and not experience inflation. The purpose of taxes, according to MMT, serves to limit inflation, by taking consumers’ money out of the money supply. This goes against the conventional idea that taxes provide the government with money to spend on the military, build infrastructure, fund social welfare programs, etc.
According to MMT, the only limit the government faces when pumping out money is the availability of real resources: raw materials, workers, construction supplies, etc. It is only when an economy hits physical or natural constraints on its productivity, when these resources have been fully put to use, will inflation result if the government continues introducing more money into the economy. Unemployment itself is the result of a government spending too little.
While the theory is controversial, much of what MMT says about US government creation of dollars and inflation is true. MMTers are not the only economists who say it. Former chair of the Federal Reserve Alan Greenspan remarked: “The United States can pay any debt it has because we can always print money to do that. So there is zero probability of default.”
Another former Fed chair, Ben Bernanke, likewise commented that the federal government’s $1 trillion bailout of the banks due to the 2008 financial crisis caused by their fraud did not come from raising taxes:
It’s not tax money. The banks have accounts with the Fed, much the same way that you have an account in a commercial bank. So, to lend to a bank, we simply use the computer to mark up the size of the account that they have with the Fed. It’s much more akin to printing money than it is to borrowing. And we need to do that, because our economy is very weak and inflation is very low.
Former IMF chief economist and president of the American Economic Association, Olivier Blanchard declared: “Put bluntly, public debt may have no fiscal cost” given that “The current US situation in which safe interest rates are expected to remain below growth rates for a long time, is more the historical norm than the exception.”
Moreover, the US has run up its national debt, has not reached full employment, nor put in play all economic resources, and has not endured inflation, just as MMT predicted. The US government this spring created $6 trillion out of thin air to fund corporations, banks and to a lesser degree, working people, during the stock market crash and COVID pandemic. Yet the rate of inflation rate is less than 1%, lower than in 2019. The Quantitative Easing program (their term for creating money out of thin air) likewise conjured up $4.5 trillion from 2009-2014, and this also caused little inflation here.
Nations Possessing a Sovereign Currency
The key question for MMT is which nations besides the US have a “sovereign currency.” While definitions of monetary sovereignty provided by MMT authors vary, there are central elements. One, the government issues the national currency and imposes tax liabilities in that currency. Therefore, countries that do not print their own currency, such as those using the euro, do not have a sovereign currency. Two, the currency is fully floating, meaning it has a flexible exchange rate system determined by market forces of demand and supply of foreign and domestic currency, and where government intervention is non-existent. According to the IMF, 31 countries have “free floating currencies;” however, 19 of them use the euro.1 The remaining 12 are Australia, Canada, Chile, Japan, Mexico, Norway, Poland, Russia, Sweden, the UK, Somalia2, and the US. Three, the nation has no debt denominated in foreign currency. It receives foreign loans and repays them in its own currency. A country with an MMT sovereign currency is able to conduct trade with other states in its own currency.
Third World nations, a central MMT economist Randall Wray explains, “are not international reserve currency issuing countries.” If countries peg their currency to the dollar or the euro and if they receive loans payable in foreign currency:
They usually will adopt austerity as a means to obtaining US dollars, and that means that they have slow growth, they’ve failed to develop, and they are dependent on the US, the IMF, and the World Bank. So we recommend moving off the peg and stop issuing government debt in foreign currencies. Now, we know that’s a difficult condition, and it’s only the first step. They’ve got to move toward food independence and energy independence, because those are usually two of the things that they import. And they’ve got many other problems to deal with, political problems, corruption, and possibly foreign intervention.
Fadhel Kaboub, the leading MMT economist on Third World economies, agrees. He points out that Third World nations count on staple food and energy imports and on imported advanced technology. They therefore, accumulate foreign debts, mostly in dollars and euros. When asked if there were any Third World nations follow the conditions MMT recommends to develop, Kaboub replied, “Unfortunately, not that I know of.” The closest, he said, were South Korea under the military dictatorship, and Singapore at some period in the past.
Given the MMT conditions for a sovereign currency, only 12 nations met the first two conditions. Meeting the further conditions, possessing no debt payable in a foreign currency and conducting its trade with other states in its own currency, requires a study of the role of the dollar in the world economy.
The Role of the US Dollar in World Trade
Most International Trade Takes Place in the Dollar
Most traded commodities in the world, including basic commodities such as oil and food grains, are priced in dollars on the global market. Generally, trade contracts between countries take place in the US currency, followed by the euro and the Japanese yen.
Therefore, foreign nations require dollars to conduct international trade. Exchange of goods and services among countries amounted to 39.7 trillion in dollar terms, in 2018, 46% of the global economy. The Society for Worldwide Interbank Financial Telecommunication (SWIFT) reports the majority of global trade takes place in dollars. (SWIFT is a key instrument the US uses to enforce its unilateral coercive measures – US imposed sanctions – to disrupt the international trading of a wide variety of countries.) In 2014, SWIFT determined the dollar makes up a 52% share of the value of international currency usage, a share that has been growing. The euro, used in trade in the eurozone region, is second, with a 30.5% share of total value. The British pound is third, with a 5.4% share. Concerning trade between regions of the world, the dollar’s role as payment currency rose to 79.5%.
Almost all international transactions are done in US dollars. Nearly all of the world’s commodities are priced in U.S dollars. So, an auto manufacturer in Korea importing steel from Japan must first convert Korean won into US dollars, pay for the transaction in dollars, and the Japanese exporter, once receiving the payment, must convert the dollars into Japanese yen. So, the Dollar is key to much of the world’s trade.
Clearly, even the secondary imperial (“developed”) powers rely on the dollar for their economic operations.
A July 2020 IMF study looked at the pricing of worldwide exports and imports in dollars, euros, and other currencies since 1990. The dollar remains the prime currency used to price goods in global trade, even increasingly used for invoicing (as was also the euro) in spite of the decline in US and eurozone international trade, mostly due to the ever-increasing trade of China.
Studies of the Role of the Dollar in Country Imports and Exports
A 2018 Harvard economics report corroborates this: “the vast majority of invoicing is neither in the local currency or in the producer’s currency but instead in a ‘dominant currency’, which is most often the U.S. dollar.” Even other imperial (“developed”) countries’ trade takes place not in their own currencies, but mostly in dollars. Another Harvard study noted that while only 13% of Japan’s imports come from the US, 71% of Japanese imports are priced in dollars, while only 33% of its exports are actually in Japanese yen. For the eurozone in 2018, 56% of the goods imported and 34% of good exported were calculated in dollars.
Most Foreign Central Bank Holdings Are in the Dollar
Central banks worldwide hold a considerable portion of their reserves in dollars, using it as their primary reserve currency. As of 2019, foreign government central banks held $6.8 trillion in US dollar reserves, about 61% of combined central bank foreign exchange reserves of $11 trillion. Nearly two-thirds of the world’s currency reserves are held in dollars, more than the combined holdings of all other currencies. The next closest reserve currency is the euro, which makes up 20% of known foreign central bank currency reserves. Japanese yen accounts for 5.7%, British pound 4.4%. Central banks held only 2% of their reserves in Chinese RMB, amounting to $221 billion worth of RMB.
While the US dollar ceased to be pegged to the price of gold, it continued as the monetary standard for other currencies, which revolve around the value of the dollar. At least 155 countries either directly peg their currency to the dollar, use the dollar as their own currency, or keep their currency in a tight trading range relative to the dollar.7 That constitutes just under 80% of the nations of the world. This means the quantity of dollars the US puts into circulation shapes to varying degrees the monetary policy of most other states. To maintain this relation to the dollar other states must keep a sufficient supply of them, undermining any sovereignty their currency may possess. Nations that peg their currencies to the dollar typically rely on exports to the US. Their companies receive payment in dollars from the US market, which they then normally exchange with their own governments for their national currency.
The US Dollar Dominates the World Trade System
In spite of the US losing the status it held after World War II as workshop of the world, the dollar still exercises control over the world economy. It is the primary currency used in world trade; it is the main currency held in national central bank reserves; it is the currency used for just under two-thirds of all international debt; close to all exchange of world currencies involves one currency’s exchange for the dollar; most currencies’ exchange value is heavily influenced by the value of the dollar. Because foreign nations conduct trade in dollars and have debts in dollars, they are dependent on the dollar and the value of the dollar. This seriously compromises any sovereign power they possess.
Consequently, only in the dollar can we find a currency that meets the MMT conditions for being sovereign. All other countries must rely on the dollar to function, particularly for trade, although the degree of this dependency varies, with the subordinate First World powers exercising more independence than Third World nations. The present set-up of the world economy insures that another currency will not become sovereign like the US dollar. Therefore, the key importance MMT attaches to sovereign currency as a tool for national development loses value given these economic realities.
A gross omission made by MMT — the elephant in the room — is US corporate capital’s rule at home and abroad, which allows it to impose itself and its currency on the world. MMT compounds this weakness by presenting the obstacles nations face in establishing a sovereign currency largely as matters of political will, of choice. Ironically, this may explain MMT’s popularity at home in the liberal-left milieu. Implementing full employment, national health insurance, free college education, and the Green New Deal are presented as choices politicians have not yet made because of their mistaken beliefs concerning the national debt. Just clarify that we do not need to raise taxes and need not worry about inflation and bingo! We have what we want.
The question remains, however, why the US debt has grown over $10 trillion in 10 years with almost no inflation. Is the MMT explanation accurate, that the sovereign nature of the US dollar gives it that power? No. Printing or creating dollars out of thin air, backed by nothing, does create inflation. In Why the US Can Keep Increasing its Debt and not Suffer Inflation we show how the US has been able to export much of it and take many of the new dollars of out circulation. This does result from the US position as sovereign, but not in the sense MMT uses.
It usually makes sense to follow the money when seeking understanding of almost any major change. The strategy of following the money in our current convergence of crises in late summer of 2020 leads us directly to the lockdowns. The lockdowns were first imposed on people in the Wuhan area of China. Then other populations throughout the world were told to “shelter in place,” all in the name of combating the COVID-19 virus.
Understanding of the enormous impact of the lockdowns is still developing. The lockdowns are proving to pack a far more devastating punch than any other aspect of the strange sequence of events that is making 2020 a year like no other. Even when the issues are narrowed to those of human health, the lockdowns have had, and will continue to have, far more wide-ranging and devastating impacts than the celebrity virus.
The lockdowns have, for starters, been directly responsible for explosive rates of suicide, domestic violence, overdoses, and depression. In the long run, these maladies from the lockdowns will probably kill and harm many more people than COVID-19.
But this comparison does not tell the full story. The nature and length of the lockdowns are causing millions of people to lose their jobs, businesses and financial viability. It seems that the economic descent is still gathering force. The assault of the lockdowns on our economic wellbeing still has much farther to go.
The lockdowns have proven to be a powerful instrument of social control. This attribute is becoming very attractive especially to some politicians. They have discovered they can derive considerable political traction from hyping and exploiting the largely manufactured pandemic panic.
The lockdowns are still a work-in-progress. There are past lockdowns, revolving lockdowns, partial lockdowns, mandatory lockdowns, voluntary lockdowns, severe lockdowns and probably an array of many lockdown types yet to be invented.
The lockdowns extend to disruptions in supply chains, disruptions in money flows, drops in consumption, breakdowns in transport and travelling, increased bankruptcies, losses of finance leading to losses of housing, as well as the inability to pay taxes and debts.
The lockdowns extend beyond personal habitations to prohibitions on large assemblies of people in stadiums, concert halls, churches, and a myriad of places devoted to public recreation and entertainment. On the basis of this way of looking at what is happening, it becomes clear the economic and health effects of the lockdowns are far more pronounced than the damage wrought directly by the new coronavirus.
This approach to following the money leads to the question of whether the spread of COVID-19 was set in motion as a pretext. Was COVID-19 unleashed as an expedient for bringing about the lockdowns with the goal of crashing the existing economy? What rationale could there possibly be for purposely crashing the existing economy?
One possible reason might have been to put in place new structures to create the framework for a new set of economic relationships. With these changes would come accompanying sets of altered social and political relationships.
Among the economic changes being sought are the robotization of almost everything, cashless financial interactions, and elaborate AI impositions. These AI impositions extend to digital alterations of human consciousness and behavior. The emphasis being placed on vaccines is very much interwoven with plans to extend AI into an altered matrix of human nanobiotechnology.
There are other possibilities to consider. One is that in the autumn of 2019 the economy was already starting to falter. Fortuitously for some, the new virus came along at a moment when it could be exploited as a scapegoat. By placing responsibility for the economic debacle on pathogens rather than people, Wall Street bankers and federal authorities are let off the hook. They can escape any accounting for an economic calamity that they had a hand in helping to instigate.
A presentation in August of 2019 by the Wall Street leviathan, BlackRock Financial Management, provides a telling indicator of foreknowledge. It was well understood by many insiders in 2019 that a sharp economic downturn was imminent.
At a meeting of central bankers in Jackson Hole Wyoming, BlackRock representatives delivered a strategy for dealing with the future downturn. Several months later during the spring of 2020 this strategy was adopted by both the US Treasury and the US Federal Reserve. BlackRock’s plan from August of 2019 set the basis of the federal response to the much-anticipated economic meltdown.
Much of this essay is devoted to considering the background of the controversial agencies now responding to the economic devastation created by the lockdowns. One of these agencies is empowered to bring into existence large quantities of debt-laden money.
The very public role in 2020 of the Federal Reserve of the United States resuscitates many old grievances. When the Federal Reserve was first created in 1913 it was heavily criticized as a giveaway of federal authority.
The critics lamented the giveaway to private bankers whose firms acquired ownership of all twelve of the regional banks that together constitute the Federal Reserve. Of these twelve regional banks, the Federal Reserve Bank of New York is by far the largest and most dominant especially right now.
The Federal Reserve of the United States combined forces with dozens of other privately-owned central banks thoughout the world to form the Bank of International Settlements. Many of the key archetypes for this type of banking were developed in Europe and the City of London where the Rothschild banking family had a large and resilient role, one that persists until this day.
Along with the Federal Reserve Bank of New York, BlackRock was deeply involved in helping to administer the bailout in 2008. This bailout resuscitated many failing Wall Street firms together with their counterparties in a number of speculative ventures involving various forms of derivatives.
The bailouts resulted in payments of $29 trillion, much of it going to restore failing financial institutions whose excesses actually caused the giant economic crash. Where the financial sector profited greatly from the bailouts, taxpayers were abused yet again. The burden of an expanded national debt fell ultimately on taxpayers who must pay the interest on the loans for the federal bailout of the “too big to fail” financial institutions.
Unsettling precedents are set by the Wall Street club’s manipulation of the economic crash of 2007-2010 to enrich its own members so extravagantly. This prior experience bodes poorly for the intervention by the same players in this current round of responses to the economic crisis of 2020.
In preparing this essay I have enjoyed the many articles by Pam Martens and Russ Martens in Wall Street on Parade. These hundreds of well-researched articles form a significant primary source on the recent history of the Federal Reserve, including over the last few months.
In this essay I draw a contrast between the privately-owned regional banks of the Federal Reserve and the government-owned Bank of Canada that once issued low-interest loans to build infrastructure projects.
With this arrangement in place, Canada went through a major period of national growth between 1938 and 1974. Canada emerged from this period with a national debt of only $20 billion. Then in 1974 Prime Minister Pierre Trudeau dropped this arrangement to enable Canada to join the Bank of International Settlements. One result is that national debt rose to $700 billion by 2020.
We need to face the current financial crisis by developing new institutions that avoid the pitfalls of old remedies for old problems that no longer prevail. We need to make special efforts to change our approach to the problem of excessive debts and the overconcentration of wealth in fewer and fewer hands.
Locking Down the Viability of Commerce
Of all the facets of the ongoing fiasco generally associated with the coronavirus crisis, none has been so widely catastrophic as the so-called “lockdowns.” The supposed cure of the lockdowns is itself proving to be much more lethal and debilitating than COVID-19’s flu-like impact on human health.
Many questions arise from the immense economic consequences attributed to the initial effort to “flatten the curve” of the hospital treatments for COVID-19. Did the financial crisis occur as a result of the spread of the new coronavirus crisis? Or was the COVID-19 crisis set in motion to help give cover to a long-building economic meltdown that was already well underway in the autumn of 2019?
The lockdowns were first instituted in Wuhan China with the objective of slowing down the spread of the virus so that hospitals would not be overwhelmed. Were the Chinese lockdowns engineered in part to create a model to be followed in Europe, North America, Indochina and other sites of infection like India and Australia? The Chinese lockdowns in Hubei province and then in other parts of China apparently set an example influencing the decision of governments in many jurisdictions. Was this Chinese example for the rest of the world created by design to influence the nature of international responses?
The lockdowns represented a new form of response to a public health crisis. Quarantines have long been used as a means of safeguarding the public from the spread of contagious maladies. Quarantines, however, involve isolating the sick to protect the well. On the other hand the lockdowns are directed at limiting the movement and circulation of almost everyone whether or not they show symptoms of any infections.
Hence lockdowns, or, more euphemistically “sheltering in place,” led to the cancellation of many activities and to the shutdown of institutions. The results extended, for instance, to the closure of schools, sports events, theatrical presentations and business operations. In this way the lockdowns also led to the crippling of many forms of economic interaction. National economies as well as international trade and commerce were severely impacted.
The concept of lockdowns was not universally embraced and applied. For instance, the governments of Sweden and South Korea did not accept the emerging orthodoxy about enforcing compliance with all kinds of restrictions on human interactions. Alternatively, the government of Israel was an early and strident enforcer of very severe lockdown policies.
At first it seemed the lockdown succeeded magnificently in saving Israeli lives. According to Israel Shamir, in other European states the Israeli model was often brought up as an example. In due course, however, the full extent of the assault on the viability of the Israeli economy began to come into focus. Then popular resistance was aroused to reject government attempts to enforce a second wave of lockdowns against a second wave of supposed infections. As Shamir sees it, the result is that “Today Israel is a failed state with a ruined economy and unhappy citizens.”
In many countries the lockdowns began with a few crucial decisions made at the highest level of government. Large and proliferating consequences would flow from the initial determination of what activities, businesses, organizations, institutions and workers were to be designated as “essential.”
The consequences would be severe for those individuals and businesses excluded from the designation identifying what is essential. This deep intervention into the realm of free choice in market relations set a major precedent for much more intervention of a similar nature to come.
The arbitrary division of activities into essential and nonessential categories created a template to be frequently replicated and revised in the name of serving public heath. Suddenly central planning took a great leap forward. The momentum from a generation of neoliberalism was checked even as the antagonistic polarities between rich and poor continued to grow.
To be defined as “nonessential” would soon be equated with job losses and business failures across many fields of enterprise as the first wave of lockdowns outside China unfolded. Indeed, it becomes clearer every day that revolving lockdowns, restrictions and social distancing are being managed in order to help give false justification to a speciously idealized vaccine fix as the only conclusive solution to a manufactured problem.
What must it have meant for breadwinners who fed themselves and their families through wages or self-employment to be declared by government to be “non-essential”? Surely for real providers their jobs, their businesses and their earnings were essential for themselves and their dependents. All jobs and all businesses that people depend on for livelihoods, sustenance and survival are essential in their own way.
Was COVID-19 a Cover for an Anticipated or Planned Financial Crisis?
A major sign of financial distress in the US economy kicked in in mid-September of 2019 when there was a breakdown in the normal operation of the Repo Market. This repurchase market in the United States is important in maintaining liquidity in the financial system.
Those directing entities like large banks, Wall Street traders and hedge funds frequently seek large amounts of cash on a short-term basis. They obtain this cash from, for instance, money market funds by putting up securities, often Treasury Bills, as collateral. Most often the financial instruments go back, say the following night, to their original owners with interest payments attached for the use of the cash.
In mid-September the trust broke down between participants in the Repo Market. The Federal Reserve Bank of New York then entered the picture making trillions of dollars available to keep the system for short-term moving of assets going. This intervention repeated the operation that came in response to the first signs of trouble as Wall Street moved towards the stock market crash of 2008.
One of the major problems on the eve of the bailout of 2008-09, like the problem in the autumn of 2019, had to do with the overwhelming of the real economy by massive speculative activity. The problem then, like a big part of the problem now, involves the disproportionate size of the derivative bets. The making of these bets have become a dangerous addiction that continues to this day to menace the viability of the financial system headquartered on Wall Street.
By March of 2020 it was reported that the Federal Reserve Bank of New York had turned on its money spigot to create $9 trillion in new money with the goal of keeping the failing Repo Market operational. The precise destinations of that money together with the terms of its disbursement, however, remain a secret. As Pam Martens and Russ Martens write,
Since the Fed turned on its latest money spigot to Wall Street [in September of 2019], it has refused to provide the public with the dollar amounts going to any specific banks. This has denied the public the ability to know which financial institutions are in trouble. The Fed, exactly as it did in 2008, has drawn a dark curtain around troubled banks and the public’s right to know, while aiding and abetting a financial coverup of just how bad things are on Wall Street.
Looking back at the prior bailout from their temporal vantage point in January of 2020, the authors noted “During the 2007 to 2010 financial collapse on Wall Street – the worst financial crisis since the Great Depression, the Fed funnelled a total of $29 trillion in cumulative loans to Wall Street banks, their trading houses and their foreign derivative counterparties.”
The authors compared the rate of the transfer of funds from the New York Federal Reserve Bank to the Wall Street banking establishment in the 2008 crash and in the early stages of the 2020 financial debacle. The authors observed, “at this rate, [the Fed] is going to top the rate of money it threw at the 2008 crisis in no time at all.”
The view that all was well with the economy until the impact of the health crisis began to be felt in early 2020 leads away from the fact that money markets began to falter dangerously in the autumn of 2019. The problems with the Repo Market were part of a litany of indicators pointing to turbulence ahead in troubled economic waters.
For instance, the resignation in 2019 of about 1,500 prominent corporate CEOs can be seen as a suggestion that news was circulating prior to 2020 about the imminence of serious financial problems ahead. Insiders’ awareness of menacing developments threatening the workings of the global economy were probably a factor in the decision of a large number of senior executives to exit the upper echelons of the business world.
Not only did a record number of CEOs resign, but many of them sold off the bulk of their shares in the companies they were leaving.
Pam Marten and Russ Marten who follow Wall Street’s machinations on a daily basis have advanced the case that the Federal Reserve is engaged in fraud by trying to make it seem that “the banking industry came into 2020 in a healthy condition;” that it is only because of “the COVID-19 pandemic” that the financial system is” unravelling,”
The authors argue that this misrepresentation was deployed because the deceivers are apparently “desperate” to prevent Congress from conducting an investigation for the second time in twelve years on why the Fed, “had to engage in trillions of dollars of Wall Street bailouts.” In spite of the Fed’s fear of facing a Congressional investigation after the November 2020 vote, such a timely investigation of the US financial sector would well serve the public interest.
The authors present a number of signs demonstrating that “the Fed knew, or should have known…. that there was a big banking crisis brewing in August of last year. ” The signs of the financial crisis in the making included negative yields on government bonds around the world as well as big drops in the Dow Jones average. The plunge in the price of stocks was led by US banks, but especially Citigroup and JP Morgan Chase.
Another significant indicator that something was deeply wrong in financial markets was a telling inversion in the value of Treasury notes with the two-year rate yielding more than the ten-year rate.
Yet another sign of serious trouble ahead involved repeated contractions in the size of the German economy. Moreover, in September of 2019 news broke that officials of JP Morgan Chase faced criminal charges for RICO-style racketeering. This scandal added to the evidence of converging problems plaguing core economic institutions as more disruptive mayhem gathered on the horizons.
Accordingly, there is ample cause to ask if there are major underlying reasons for the financial crash of 2020 other than the misnamed pandemic and the lockdowns done in its name of “flattening” its spikes of infection. At the same time, there is ample cause to recognize that the lockdowns have been a very significant factor in the depth of the economic debacle that is making 2020 a year like no other.
Some go further. They argue that the financial crash of 2020 was not only anticipated but planned and pushed forward with clear understanding of its instrumental role in the Great Reset sought by self-appointed protagonists of creative destruction. The advocates of this interpretation place significant weight on the importance of the lockdowns as an effective means of obliterating in a single act a host of old economic relationships. For instance Peter Koenig examines the “farce and diabolical agenda of a universal lockdown.”
Koenig writes, “The pandemic was needed as a pretext to halt and collapse the world economy and the underlying social fabric.”
Inflating the Numbers and Traumatizing the Public to Energize the Epidemic of Fear
There have been many pandemics in global history whose effects on human health have been much more pervasive and devastating than the current one said to be generated by a new coronavirus. In spite, however, of its comparatively mild flu-like effects on human health, at least at this point in the summer of 2020, there has never been a contagion whose spread has generated so much global publicity and hype. As in the aftermath of 9/11, this hype extends to audacious levels of media-generated panic. As with the psyop of 9/11, the media-induced panic has been expertly finessed by practitioners skilled in leveraging the currency of fear to realize a host of radical political objectives.
According to Robert E. Wright in an essay published by the American Institute for Economic Research, “closing down the U.S. economy in response to COVID-19 was probably the worst public policy in at least one-hundred years.” As Wright sees it, the decision to lock down the economy was made in ignorant disregard of the deep and devastating impact that such an action would spur. “Economic lockdowns were the fantasies of government officials so out of touch with economic and physical reality that they thought the costs would be fairly low.”
The consequences, Wright predicts, will extend across many domains including the violence done to the rule of law. The lockdowns, he writes, “turned the Constitution into a frail and worthless fabric.” Writing in late April, Wright touched on the comparisons to be made between the economic lockdowns and slavery. He write, “Slaves definitely had it worse than Americans under lockdown do, but already Americans are beginning to protest their confinement and to subtly subvert authorities, just as chattel slaves did.”
The people held captive in confined lockdown settings have had the time and often the inclination to imbibe much of the 24/7 media coverage of the misnamed pandemic. Taken together, all this media sensationalism has come to constitute one of the most concerted psychological operations ever.
The implications have been enormous for the mental health of multitudes of people. This massive alteration of attitudes and behaviours is the outcome of media experiments performed on human subjects without their informed consent. The media’s success in bringing about herd subservience to propagandistic messaging represents a huge incentive for more of the same to come. It turns out that the subject matter of public health offers virtually limitless potential for power-seeking interests and agents to meddle with the privacies, civil liberties and human rights of those they seek to manipulate, control and exploit.
The social, economic and health impacts of the dislocations flowing from the lockdowns are proving to be especially devastating on the poorest, the most deprived and the most vulnerable members of society. This impact will continue to be marked in many ways, including in increased rates of suicide, domestic violence, mental illness, addictions, homelessness, and incarceration far larger than those caused directly by COVID-19. As rates of deprivation through poverty escalate, so too will crime rates soar.
The over-the-top alarmism of the big media cabals has been well financed by the advertising revenue of the pharmaceutical industry. With some few exceptions, major media outlets pushed the public to accept the lockdowns as well as the attending losses in jobs and business activity. In seeking to push the agenda of their sponsors, the big media cartels have been especially unmindful of their journalistic responsibilities. Their tendency has been to avoid or censor forums where even expert practitioners of public health can publicly question and discuss government dictates about vital issues of public policy.
Whether in Germany or the United States or many other countries, front line workers in this health care crisis have nevertheless gathered together with the goal of trying to correct the one-sided prejudices of of discriminatory media coverage. One of the major themes in the presentations by medical practitioners is to confront the chorus of media misrepresentations on the remedial effects of hydroxychloroquine and zinc.
On July 27 a group of doctors gathered on the grounds of the US Supreme Court to try to address the biases of the media and the blind spots of government.
Another aspect in the collateral damage engendered by COVID-19 alarmism is marked in the fatalities arising from the wholesale postponement of many necessary interventions including surgery. How many have died or will die because of the hold put on medical interventions to remedy cancer, heart conditions and many other potentially lethal ailments?
Did the unprecedented lockdowns come about as part of a preconceived plan to inflate the severity of an anticipated financial meltdown? What is to be made of the suspicious intervention of administrators to produce severely padded numbers of reported deaths in almost every jurisdiction? This kind of manipulation of statistics raised the possibility that we are witnessing a purposeful and systemic inflation of the severity of this health care crisis.
Questions about the number of cases arise because of the means of testing for the presence of a supposedly new coronavirus. The PCR system that is presently being widely used does not test for the virus but tests for the existence of antibodies produced in response to many health challenges including the common cold. This problem creates a good deal of uncertainty of what a positive test really means.
The problems with calculating case numbers extend to widespread reports that have described people who were not tested for COVID-19 but who nevertheless received notices from officials counting them as COVID-19 positive. Broadcaster Armstrong Williams addressed the phenomenon on his network of MSM media outlets in late July.
From the mass of responses he received, Williams estimated that those not tested but counted as a positive probably extends probably to hundreds of thousands of individuals. What would drive the effort to exaggerate the size of the afflicted population?
This same pattern of inflation of case numbers was reinforced by the Tricare branch of the US Defense Department’s Military Health System. This branch sent out notices to 600,000 individuals who had not been tested. The notices nevertheless informed the recipients that they had tested positive for COVID 19.
Is the inflation of COVID-19 death rates and cases numbers an expression of the zeal to justify the massive lockdowns? Were the lockdowns in China conceived as part of a scheme to help create the conditions for the public’s acceptance of a plan to remake the world’s political economy? What is to be made of the fact that those most identified with the World Economic Forum (WEF) have led the way in putting a positive spin on the reset arising from the very health crisis the WEF helped introduce and publicize in Oct. of 2019?
As Usual, the Poor Get Poorer
The original Chinese lockdowns in the winter of 2020 caused the breakdowns of import-export supply chains extending across the planet. Lockdowns in the movement of raw materials, parts, finished products, expertise, money and more shut down domestic businesses in China as well as transnational commerce in many countries outside China. The supply chain disruptions were especially severe for businesses that have dispensed with the practice of keeping on hand large inventories of parts and raw material, depending instead on just-in-time deliveries.
As the supply chains broke down domestically and internationally, many enterprises lacked the revenue to pay their expenses. Bankruptcies began to proliferate at rates that will probably continue to be astronomical for some time. All kinds of loans and liabilities were not paid out in full or at all. Many homes are being re-mortgaged or cast into real estate markets as happened during the prelude and course of the bailouts of 2007-2010.
The brunt of the financial onslaught hit small businesses especially hard. Collectively small businesses have been a big creator of jobs. They have picked up some of the slack from the rush of big businesses to downsize their number of full-time employees. Moreover, small businesses and start-ups are often the site of exceptionally agile innovations across broad spectrums of economic activity. The hard financial slam on the small business sector, therefore, is packing a heavy punch on the economic conditions of everyone.
The devastating impact of the economic meltdown on workers and small businesses in Europe and North America extends in especially lethal ways to the massive population of poor people living all over the world. Many of these poor people reside in countries where much of the paid work is irregular and informal.
At the end of April the International Labor Organization (ILO), an entity created along with the League of Nations at the end of the First World War, estimated that there would be 1.6 billion victims of the meltdown in the worldwide “informal economy.” In the first month of the crisis these workers based largely in Africa and Latin America lost 60% of their subsistence level incomes.
This pandemic has laid bare in the cruellest way, the extraordinary precariousness and injustices of our world of work. It is the decimation of livelihoods in the informal economy – where six out of ten workers make a living – which has ignited the warnings from our colleagues in the World Food Programme, of the coming pandemic of hunger. It is the gaping holes in the social protection systems of even the richest countries, which have left millions in situations of deprivation. It is the failure to guarantee workplace safety that condemns nearly 3 million to die each year because of the work they do. And it is the unchecked dynamic of growing inequality which means that if, in medical terms, the virus does not discriminate between its victims in its social and economic impact, it discriminates brutally against the poorest and the powerless.
Guy Ryder remembered the optimistic rhetoric in officialdom’s responses to the economic crash of 2007-2009. He compares the expectations currently being aroused by the vaccination fixation with the many optimistic sentiments previously suggesting the imminence of remedies for grotesque levels of global inequality. Ryder reflected,
We’ve heard it before. The mantra which provided the mood music of the crash of 2008-2009 was that once the vaccine to the virus of financial excess had been developed and applied, the global economy would be safer, fairer, more sustainable. But that didn’t happen. The old normal was restored with a vengeance and those on the lower echelons of labour markets found themselves even further behind.
The internationalization of increased unemployment and poverty brought about in the name of combating the corona crisis is having the effect of further widening the polarization between rich and poor on a global scale. Ryder’s metaphor about the false promises concerning a “vaccine” to correct “financial excess” can well be seen as a precautionary comment on the flowery rhetoric currently adorning the calls for a global reset.
Wall Street and 9/11
The world economic crisis of 2020 is creating the context for large-scale repeats of some key aspects of the bailout of 2007-2010. The bailout of 2007-2008 drew, in turn, from many practices developed in the period when the explosive events of 9/11 triggered a worldwide reset of global geopolitics.
While the events of 2008 and 2020 both drew attention to the geopolitical importance of Wall Street, the terrible pummelling of New York’s financial district was the event that ushered in a new era of history, an era that has delivered us to the current financial meltdown/lockdown.
It lies well beyond the scope of this essay to go into detail about the dynamics of what really transpired on 9/11. Nevertheless, some explicit reckoning with this topic is crucial to understanding some of the essential themes addressed in this essay.
Indeed, it would be difficult to overstate the relevance of 9/11 to the background and nature of the current debacle. The execution and spinning of 9/11 were instrumental in creating the repertoire of political trickery presently being adapted in the manufacturing and exploiting of the COVID-19 hysteria. A consistent attribute of the journey from 9/11 to COVID-19 has been the amplification of executive authority through the medium of emergency measures enactments, policies and dictates.
Wall Street is a major site where much of this political trickery was concocted in planning exercises extending to many other sites of power and intrigue. In the case of 9/11, a number of prominent Wall Street firms were involved before, during and after the events of September 11. As is extremely well documented, these events have been misrepresented in ways that helped to further harness the military might of the United States to the expansionistic designs of Israel in the Middle East.
The response of the Federal Reserve to the events of 9/11 helped set in motion a basic approach to disaster management that continues to this day. Almost immediately following the pulverization of Manhattan’s most gigantic and iconographic landmarks, Federal Reserve officials made it their highest priority to inject liquidity into financial markets. Many different kinds of scenario can be advanced behind the cover of infusing liquidity into markets.
For three days in a row the Federal Reserve Bank of New York turned on its money spigots to inject transfusions of $100 billion dollars of newly generated funds into the Wall Street home of the financial system. The declared aim was to keep the flow of capital between financial institutions well lubricated. The Federal Reserve’s infusions of new money into Wall Street took many forms. New habits and appetites were thereby cultivated in ways that continue to influence the behaviour of Wall Street organizations in the financial debacle of 2020.
The revelations concerning the events of 9/11 contained a number of financial surprises. Questions immediately arose, for instance, about whether the destruction of the three World Trade Center skyscrapers had obliterated software and hardware vital to the continuing operations of computerized banking systems. Whatever problems arose along these lines, it turned out that there was sufficient digital information backed up in other locations to keep banking operations viable.
But while much digital data survived the destruction of core installations in the US financial sector, some strategic information was indeed obliterated. For instance, strategic records entailed in federal investigations into many business scandals were lost. Some of the incinerated data touched on, for instance, the machinations of the energy giant, Enron, along with its Wall Street partners, JP Morgan Chase and Citigroup.
The writings of E. P Heidner are prominent in the literature posing theories about the elimination of incriminating documentation as a result of the controlled demolitions of 9/11. What information was eliminated and what was retained in the wake of the devastation? Heidner has published a very ambitious account placing the events of 9/11 at the forefront of a deep and elaborate relationship linking George H. W. Bush to Canada’s Barrick Gold and the emergence of gold derivatives.
The surprises involving 9/11 and Wall Street included evidence concerning trading on the New York Stock Exchange. A few individuals enriched themselves significantly by purchasing a disproportionately high number of put options on shares about to fall precipitously as a result of the anticipated events of 9/11. Investigators, however, chose to ignore this evidence because it did not conform to the prevailing interpretation of who did what to whom on 9/11.
Another suspicious group of transactions conducted right before 9/11 involved some very large purchases of five-year US Treasury notes. These instruments are well known hedges when one has knowledge that a world crisis is imminent. One of these purchases was a $5 billion transaction. The US Treasury Department would have been informed about the identity of the purchaser. Nevertheless the FBI and the Securities Exchange Commission collaborated to point public attention away from these suspect transactions. (p. 199)
On the very day of 9/11 local police arrested Israeli suspects employed in the New York area as Urban Movers. The local investigators were soon pressured to ignore the evidence, however, and go along with the agenda of the White House and the media chorus during the autumn of 2001.
In the hours following the pulverization of the Twin Towers the dominant mantra was raised “Osama bin Laden and al-Qeada did it.” That mantra led in the weeks, months and years that followed to US-led invasions of several Muslim-majority countries. Some have described these military campaigns as wars for Israel.
Soon New York area jails were being filled up with random Muslims picked up for nothing more than visa violations and such. The unrelenting demonization of Muslims collectively can now be seen in retrospect as a dramatic psychological operation meant to poison minds as the pounding of the war drums grew in intensity. In the process a traumatized public were introduced to concepts like “jihad.” At no time has there ever been a credible police investigation into the question of who is responsible for the 9/11 crimes.
Defense Secretary Donald Rumsfeld chose September 10, the day before 9/11, to break the news at a press conference that $2.3 trillion had gone missing from the Pentagon’s budget. Not surprisingly the story of the missing money got buried the next day as reports of the debacle in Manhattan and Washington DC dominated MSM news coverage.
As reported by Forbes Magazine, the size of the amount said to have gone missing in Donald Rumsfeld’s 2001 report of Defense Department spending had mushroomed by 2015 to around $21 trillion. It was Mark Skidmore, an Economics Professor at the University of Michigan, who became the main sleuth responsible for identifying the gargantuan amount of federal funds that the US government can’t account for.
As the agency that created the missing tens of trillions that apparently has disappeared without a trace, wouldn’t the US Federal Reserve be in a position to render some assistance in tracking down the lost funds? Or is the Federal Reserve somehow a participant or a complicit party in the disappearance of the tens of trillions without a paper trail?
The inability or unwillingness of officialdom to explain what happened to the lost $21 trillion, an amount comparable to the size of the entire US national debt prior to the lockdowns, might be viewed in the light of the black budgets of the US Department of Defense (DOD). Black budgets are off-the-books funds devoted to secret research and to secret initiatives in applied research.
In explaining this phenomenon, former Canadian Defense Minister, Paul Hellyer, has observed, “thousands of billions of dollars have been spent on projects about which Congress and the Commander In Chief have deliberately been kept in the dark.” Eric Zuesse goes further. As he explains it, the entire Defense Department operates pretty much on the basis of an unusual system well outside the standard rules of accounting applied in other federal agencies.
When news broke about the missing $21 trillion, federal authorities responded by promising that special audits would be conducted to explain the irregularities. The results of those audits, if they took place at all, were never published. The fact that the Defense of Department has developed in a kind of audit free zone has made it a natural magnet for people and interests engaged in all kinds of criminal activities.
Eric Zuesse calls attention to the 1,000 military bases around the world that form a natural network conducive to the cultivation of many forms of criminal trafficking. Zuesse includes in his reflections commentary on the secret installations in some American embassies but especially in the giant US Embassy in Baghdad Iraq.
The US complex in Baghdad’s Green Zone is the biggest Embassy in the world. Its monumental form on a 104 acre site expresses the expansionary dynamics of US military intervention in the Middle East and Eurasia following 9/11.
The phenomenon of missing tens of trillions calls attention to larger patterns of kleptocratic activity that forms a major subject addressed here. The shifts into new forms of organized crime in the name of “national security” began to come to light in the late 1980s. An important source of disclosures was the series of revelations that accompanied the coming apart of the Saudi-backed Bank of Credit and Commerce International, the BCCI.
The nature of this financial institution, where CIA operatives were prominent among its clients, provides a good window into the political economy of drug dealing, money laundering, weapons smuggling, regime change and many much more criminal acts that took place along the road to 9/11.
The BCCI was a key site of financial transactions that contributed to the end of the Cold War and the inception of many new kinds of conflict. These activities often involved the well-financed activities of mercenaries, proxy armies, and a heavy reliance on private contractors of many sorts.
The Enron scandal was seen to embody some of the same lapses facilitated by fraudulent accounting integral to the BCCI scandal. Given the bubble of secrecy surrounding the Federal Reserve, there are thick barriers blocking deep investigation into whether or not the US Central Bank was involved in the relationship of the US national security establishment and the BCCI.
The kind of dark transactions that the BCCI was designed to facilitate must have been channelled after its demise into other banking institutions probably with Wall Street connections. Since 9/11, however, many emergency measures have been imposed that add extra layers of secrecy protecting the perpetrators of many criminal acts from public exposure and criminal prosecutions.
The events of 9/11 have sometimes been described as the basis of a global coup. To this day there is no genuine consensus about what really transpired to create the illusion of justification for repeated US military invasions of Muslim-majority countries in the Middle East and Eurasia.
The 9/11 debacle and the emergency measures that followed presented Wall Street with an array of new opportunities for profit that came with the elaborate refurbishing and retooling of the military-industrial complex.
The response to 9/11 was expanded and generalized upon to create the basis of a war directed not at a particular enemy, but rather at an ill-defined conception identified as “terrorism.” This alteration was part of a complex of changes adding trillions to the flow of money energizing the axis of interaction linking the Pentagon and Wall Street and the abundance of new companies created to advance the geopolitical objectives emerging from the 9/11 coup.
According to Pam Martens and Russ Martens, the excesses of deregulation helped induce an anything-goes-ethos on Wall Street and at its Federal Reserve regulator in the wake of 9/11. As the authors tell it, the response to 9/11 helped set important precedents for the maintaining flows of credit and capital in financial markets.
Often the destination of the funds generated in the name of pumping liquidity into markets was not identified and reported in transactions classified as financial emergency measures. While the priority was on keeping financial pumps primed, there was much less concern for transparency and accountability among those in positions of power at the Federal Reserve.
The financial sector’s capture of the government instruments meant to regulate the behaviour of Wall Street institutions was much like the deregulation of the US pharmaceutical industry. Both episodes highlight a message that has become especially insistent as the twenty-first century unfolds.
The nature of the response to 9/11 emphasized the mercenary ascent of corporate dominance as the primary force directing governments. Throughout this transformation the message to citizens became increasingly clear. Buyer Beware. We cannot depend on governments to represent our will and interests. We cannot even count on our governments to protect citizens from corporatist attacks especially on human health and whatever financial security we have been able to build up.
Bailouts, Derivatives, and the Federal Reserve Bank of New York
The elimination of the Glass-Steagall Act in 1999 was essential to the process of dramatically cutting back the government’s role as a protector of the public interest on the financial services sector. The Glass-Steagall Act was an essential measure in US President Franklin D. Roosevelt’s New Deal. Some view the New Deal as a strategy for saving capitalism by moderating ts most sharp-edged features. Instituted in 1933 in response to the onset of the Great Depression, the Glass-Steagall Act separated the operations of deposit-accepting banks from the more speculative activity of investment brokers.
The termination of the regulatory framework put in place by the Glass Steagall Act opened much new space for all kinds of experiments in the manipulation of money in financial markets. The changes began with the merger of different sorts of financial institutions including some in the insurance field. Those overseeing the reconstituted entities headquartered on Wall Street took advantage of their widened latitudes of operation. They developed all sorts of ways of elaborating their financial services and presenting them in new packages.
The word, “derivative” is often associated with many applications of the new possibilities in the reconstituted financial services sector. The word, derivative, can be applied to many kinds of transactions involving speculative bets of various sorts. As the word suggests, a derivative is derived from a fixed asset such as currency, bonds, stocks, and commodities. Alterations in the values of fixed assets affect the value of derivatives that often take the form of contracts between two or more parties.
One of the most famous derivatives in the era of the financial crash of 2007-2010 was described as mortgaged-backed securities. On the surface these bundles of debt-burdened properties might seem easy to understand. But that would be a delusion. The value of these products was affected, for instance, by unpredictable shifts in interest rates, liar loans extended to homebuyers who lacked the capacity to make regular mortgage payments, and significant shifts in the value of real estate.
Mortgage-backed securities were just one type of a huge array of derivatives invented on the run in the heady atmosphere of secret and unregulated transactions between counterparties. Derivatives could involve contracts formalizing bets between rivals gambling on the outcome of competitive efforts to shape the future. An array of derivative bets was built around transactions often placed behind the veil of esoteric nomenclature like “collateralized debt obligations” or “credit default swaps.”
The variables in derivative bets might include competing national security agendas involving, for instance, pipeline constructions, regime change, weapons development and sales, false flag terror events, or money laundering. Since derivative bets involve confidential transactions with secret outcomes, they can be derived from all sorts of criteria. Derivative bets can, for instance, involve all manner of computerized calculations that in some cases are constructed much like war game scenarios.
The complexity of derivatives became greater when the American Insurance Group, AIG, began selling insurance programs to protect all sides in derivative bets from suffering too drastically from the consequences of being on the losing side of transactions.
The derivative frenzy, sometimes involving bets being made by parties unable to cover potential losses, overwhelmed the scale of the day-to-day economy. The “real economy” embodies exchanges of goods, services, wages and such that supply the basic necessities for human survival with some margin for recreation, travel, cultural engagement and such.
The Swiss-based Bank of International Settlements calculated in 2008 that the size of the all forms of derivative products had a monetary value of $1.14 quadrillion. A quadrillion is a thousand trillions. By comparison, the estimated value of all the real estate in the world was $75 trillion in 2008.
As the enticements of derivative betting preoccupied the leading directors of Wall Street institutions, their more traditional way of relating to one another began to falter. It was in this atmosphere that the Repo Market became problematic in December of 2007 just as it showed similar signs of breakdown in September of 2019.
In both instances the level of distrust between those in charge of financial institutions began to falter because they all had good reason to believe that their fellow bankers were overextended. All had reason to believe their counterparts were mired by too much speculative activity enabled by all sorts of novel experiments including various forms of derivative dealing.
In December of 2007 as in the autumn of 2019, the Federal Reserve Bank of New York was forced to enter the picture to keep the financial pumps on Wall Street primed. The New York Fed kept the liquidity cycles flowing by invoking its power to create new money with the interest charged to tax payers.
As the financial crisis unfolded in 2008 and 2009 the Federal Reserve, but especially the privately-owned New York Federal Reserve bank, stepped forward to bail out many financial institutions that had become insolvent or near insolvent. In the process precedents and patterns were established that are being re-enacted with some modifications in 2020.
One of the innovations that took place in 2008 was the decision by the Federal Reserve Bank of New York to hire a large Wall Street financial institution, BlackRock, to administer the bailouts. These transfers of money went through three specially created companies now being replicated as Special Purpose Vehicles in the course of the payouts of 2020.
In 2008-09 BlackRock administered the three companies named after the address of the New York Federal Reserve Bank on Maiden Lane. BlackRock emerged from an older Wall Street firm called Blackstone. Its former chair, Peter C. Peterson, was a former Chair of the Federal Reserve Bank of New York.
The original Maiden Lane company paid Bear Stearns Corp $30 billion. This amount from the New York Fed covered the debt of Bear Stearns, a condition negotiated to clear the way for the purchase of the old Wall Street institution by JP Morgan Chase. Maiden Lane II was a vehicle for payouts to companies that had purchased “mortgage-backed securities” before these derivative products turned soar.
Maiden Lane III was to pay off “multi-sector collateralized debt obligations.” Among these bailouts were payoffs to the counterparties of the insurance giant, AIG. As noted, AIG had developed an insurance product to be sold to those engaged in derivative bets. When the bottom fell out of markets, AIG lacked the means to pay off the large number of insurance claims made against it. The Federal Reserve Bank of New York stepped in to bail out the counterparties of AIG, many of them deemed to be “too big to fail.”
Among the counterparties of AIG was Goldman Sachs. It received of $13 billion from the Federal Reserve. Other bailouts to AIG’s counterparties were $12 billion to Deutsche Bank, $6.8 billion to Merrill Lynch, $5 billion to Switzerland’s UBS, $7.9 billion to Barclays, and $5.2 billion to Bank of America. Some of these banks received additional funds from other parts of the overall bailout transaction. Many dozens of other counterparties to AIG also received payouts in 2008-2009. Among them were the Bank of Montreal and Bank of Scotland.
The entire amount of the bailouts was subsequently calculated to be a whopping $29 trillion with a “t.” The lion’s share of these funds went to prop up US financial institutions and the many foreign banks with which they conducted business.
Much of this money went to the firms that were shareholders in the Federal Reserve Bank of New York or partners of the big Wall Street firms. Citigroup, the recipient of the largest amount, received about $2.5 trillion in the federal bailouts. Merrill Lynch received $2 trillion,
The Federal Reserve Bank was established by Congressional statute in 1913. The Federal Reserve headquarters is situated in Washington DC. The Central Bank was composed of twelve constituent regional banks. Each one of these regional banks is owned by private banks.
The private ownership of the banks that are the proprietors of the Federal Reserve system has been highly contentious from its inception. The creation of the Federal Reserve continues to be perceived by many of its critics as an unjustifiable giveaway whereby the US government ceded to private interests its vital capacity to issue its own currency and to direct monetary policy like the setting of interest rates.
Pam Martens and Russ Martens at Wall Street on Parade explain the controversial Federal Reserve structure as follows
While the Federal Reserve Board of Governors in Washington, D.C. is deemed an “independent federal agency,” with its Chair and Governors appointed by the President and confirmed by the Senate, the 12 regional Fed banks are private corporations owned by the member banks in their region. The settled law under John L. Lewis v. the United States confirms: “Each Federal Reserve Bank is a separate corporation owned by commercial banks in its region.”
In the case of the New York Fed, which is located in the Wall Street area of Manhattan, its largest shareowners are behemoth multinational banks, including JPMorgan Chase, Citigroup, Goldman Sachs and Morgan Stanley.
There was no genuine effort after the financial debacle of 2007-2010 to correct the main structural problems and weaknesses of the Wall Street-based US financial sector. The Dodd-Frank Bill signed into law by US President Barack Obama in 2010 did make some cosmetic changes. But the main features of the regulatory capture that has taken place with the elimination of the Glass-Steagall Act remained with only minor alterations. In particular the framework was held in place for speculative excess in derivative bets.
In the summer edition of The Atlantic, Frank Partnoy outlined a gloomy assessment of the continuity leading from the events of 2007-2010 to the current situation. This current situation draws a strange contrast between the lockdown-shattered quality of the economy and the propped-up value of the stock market whose future value will in all probability prove unsustainable. Partnoy writes,
It is a distasteful fact that the present situation is so dire in part because the banks fell right back into bad behavior after the last crash—taking too many risks, hiding debt in complex instruments and off-balance-sheet entities, and generally exploiting loopholes in laws intended to rein in their greed. Sparing them for a second time this century will be that much harder.
Wall Street Criminality on Display
The frauds and felonies of the Wall Street banks have continued after the future earnings of US taxpayers returned them to solvency after 2010. The record of infamy is comparable to that of the pharmaceutical industry.
The criminal behaviour in both sectors is very relevant to the overlapping crises that are underway in both the public health and financial sectors. In 2012 the crime spree in the financial sector began with astounding revelations about the role of many major banks in the LIBOR, the London Interbank Offered Rate. The LIBOR rates create the basis of interest rates involved in the borrowing and lending of money in the international arena.
When the scandal broke there were 35 different LIBOR rates involving various types of currency and various time frames for loans between banks. The rates were calculated every day based on information forwarded from 16 different banks to a panel on London. The reporting banks included Citigroup, JP Morgan Chase, Bank of America, UBS, and Deutsche Bank. The influence of the LIBOR rate extended beyond banks to affect the price of credit in many types of transactions.
The emergence of information that the banks were working together to rig the interest rate created the basis for a huge economic scandal. Fines extending from hundreds of millions into more than a billion dollars were placed on each of the offending banks. But in this instance and many others to follow, criminality was attached to the financial entities but not to top officials responsible for the decisions that put their corporations on the wrong side of the law.
One of the factors in the banking frauds comprising the LIBOR scandal was the temptation to improve the chance for financial gains in derivative bets. The biggest failure of the federal response to the financial meltdown of 2007-210 was that little was done to curb the excesses of transactions in the realm of derivatives.
Derivatives involved a form of gambling that exists in a kind of twilight zone. This twilight zone fills a space somewhere between the realm of the real economy and the realm of notional value. Notional values find expression in unrealized speculation about what might or might not come to fruition; what might or might not happen; who might win and who might lose in derivative speculations.
The addiction of Wall Street firms to derivative betting remains unchecked to this day. The bankers’ continuing fixation with unregulated gambling, often with other people’s money, is deeply menacing for the future of the global economy…. indeed for the future of everyone on earth. According to the Office of the Controller of Currency, in 2019 JP Morgan Chase had $59 trillion in derivative bets. In July of 2020 it emerged that Citigroup held $62 trillion in derivative contracts, about $30 trillion more than it held before it was bailed out in 2008. In 2019 Goldman Sachs held $47 trillion and Bank of America held $20.4 trillion in derivate bets.
A big part of the scandal embodied in these figures is embedded in the reality that all of these banks carry their most risky derivative bets in units of their corporate networks that are protected by the Federal Deposit Insurance Corporation. This peril played a significant part in deepening the crisis engendered by financial meltdown that began in 2007.
One of the most redeeming features of the Dodd-Frank Act as originally drafted was a provision preventing financial institutions from keeping their derivative portfolios in banks whose deposits and depositors were backed up by federal insurance.
Citigroup led the push in Congress in 2014 to allow Wall Street institutions to revert back to a more deregulated and danger-prone economic environment. The notoriously inept decisions and actions of Citigroup had played a significant role in the lead up to the financial debacle of 2007 to 2010. Since 2016 Citigroup has become once again the biggest risk taker by loading itself up with more derivative speculations than any other financial institution in the world.
By returning derivative speculations to the protections of federal financial backstops, taxpayers are once again forced to assume responsibility for the most outlandish risks of Wall Street’s high rollers. It is taxpayers who are the backers of the federal government when it comes to their commitment to compensate banks for losses, even when these losses come about from derivative bets.
How much more Wall Street risk and public debt can be loaded onto taxpayers and even onto generations of taxpayers yet unborn? How is national debt to be understood when it plunders working people to guarantee and augment the wealth of the most privileged branches of society? Why should those most responsible for creating the most excessive risks to the financial wellbeing of our societies be protected from bearing the consequences of the very risks they themselves created?
Along with Citigroup, JP Morgan Chase stands out among a group of financial sector reprobates most deeply involved in sketchy activities that extend deep into the realm of criminality. In a simmering scandal six of JP Morgan Chase’s traders have been accused of breaking laws in conducting the bank’s futures trading in the value of precious metals. They have been accused of violating the RICO statute, a law meant for people suspected of being part of organized crime.
In the charges pressed by the Justice Department on JP Morgan Chase’s traders it is alleged that they “conducted the affairs of the [minerals] desk through a pattern of racketeering activity, specifically, wire fraud affecting a financial institution and bank fraud.”
In 2012 JP Morgan Chase faced a $1 billion fine for its role in the “London Wale” series of derivative bets described as follows by the Chair of the US Senate’s Permanent Subcommittee on Investigation. Senator Carl Levin explained, “Our findings open a window into the hidden world of high stakes derivatives trading by big banks. It exposes a derivatives trading culture at JPMorgan that piled on risk, hid losses, disregarded risk limits, manipulated risk models, dodged oversight, and misinformed the public.”
Traders at Goldman Sachs appear to have been part of the Wall Street crime spree. The tentacles of corruption in the Goldman Sachs case apparently extend deep into the US Justice Department. The case involves allegations of embezzlement, money laundering and missing billions. These manifestations of malfeasance all spin out of a scandal-prone Malaysian sovereign wealth fund administered by Goldman Sachs.
A big part of the scandal reported in Wall Street on Parade in July of 2020 involves the fact that the Justice Department’s prosecutors seem to be dragging their feet in this possible criminal felony case against Goldman Sachs. The prosecutors, including the US Attorney-General, William Barr, worked previously for the law firm, Kirkland and Ellis. Kirkland and Ellis was retained to defend Goldman Sachs in this matter.
Pam Martens and Russ Martens express dismay at the failure of US officialdom to hold Wall Street institutions accountable for the crime spree of some of its biggest firms. They write, “Congress and the executive branch of the government seem determined to protect Wall Street criminals, which simply assures their proliferation.”
Even racketeering charges against officials at JP Morgan Chase, where Jamie Dimon presides as CEO, failed to receive any attention from the professional deceivers that these days dominate MSM. The star reporters of Wall Street on Parade write, “Crime and fraud are so de rigueur at the bank led by Dimon that not one major newspaper ran the headline [of the racketeering charge] on the front page or anywhere else in the paper.
While federal charges that JP Morgan Chase’s Wall Street operation engaged in criminal racketeering was not of interest to the press, Jamie Dimon’s surprise visit in early June to a Chase branch in Mt. Kisco New York aroused considerable media attention. Dimon was photographed with staff wearing a mask and taking the knee. By participating in this ritual Dimon signaled that his Wall Street operation is in league with the sometimes violent cancel culture pushed into prominence by the Democratic Party in partnership with Black Lives Matter and Antifa.
*(JPMorgan CEO Jamie Dimon takes a knee with employees in front of a bank vault. Credit: JPMorgan)
In an article on 21 July marking ten years since the Dodd-Frank Act of 2010, the Martens duo conclude, “So here we are today, watching the Fed conduct another secret multi-trillion dollar bailout of Wall Street while the voices of Congress and mainstream media are nowhere to be heard.”
In March it was announced that representatives of the US Treasury Department, the Federal Reserve Board and the BlackRock financial management were joining forces to make adjustments in the US economy. The aim was to address the financial dislocations resulting from the decision to lock down businesses, citizens, schools, entertainment, and social mingling outside the home, all in response to the health care hysteria promoted by governments and their media extensions.
The format of this process suggested some relaxation in the strict distinctions historically drawn between the US Treasury and the Federal Reserve. What would be the role of the third member of the group? In reflecting on this topic Joyce Nelson observed, “the new bailout bill not only further erases the line between the Federal Reserve and the U.S. Treasury, it places BlackRock effectively in an overseer position for both.”
Some saw as symbolically instructive the delegation to BlackRock of a larger role than that assigned it during the first bailout of 2007-2008. It would be hard to overestimate the significance of this prominent Wall Street firm’s return to a strategic role near the very heart of this major exercise of federal power. This invitation to take part in such crucial negotiations at such a consequential juncture in history caused some to characterize BlackRock as a “fourth branch of government.”
As Victoria Guida commented in Politico, “This is a transformational moment for the Fed, and BlackRock’s now going to be in an even stronger position to serve the Fed in the future.”
BlackRock officials had been instrumental in helping to manoeuvre their company into such a strategic role by responding proactively to the understanding in some elite circles that another financial debacle was imminent. Only months before the financial meltdown actually occurred a group of former central bankers all commissioned by BlackRock delivered a recovery plan in August of 2019.
Presented at a G 7 summit of central bankers in Jackson Hole Wyoming, the plan for the government responses to the looming financial collapse was entitled Dealing with the Next Downturn. Its authors are Stanley Fischer, former Governor of the Central Bank of Israel, Philipp Hildebrande, former Chairman of the Governing Board of the Swiss National Bank, Jean Boivin, former Deputy Governor of the Bank of Canada, and Elga Bartsch, Economist at Morgan Stanley.
The BlackRock Team at Jackson Hole put forward the case that a more aggressive and coordinated combination of monetary and fiscal policy must be brought to the job of stimulating a financial recovery. Monetary policy includes the setting of interest rates. Where monetary policy has historically been the domain of the central banks, fiscal policy, involving issues of taxation as well as the content and size of government budgets, lies within the jurisdiction of elected legislatures.
The nub of the proposal to unite fiscal and monetary policy put the US Treasury and the US Federal Reserve on the same political platform. As the author of this merger of monetary and fiscal policy, BlackRock became third member of the triumvirate charged to address the broad array of economic maladies that arrived in the wake of the lockdowns.
In the spring of 2020 BlackRock has been hired by the Bank of Canada and by Sweden’s Central Bank, the Riksbank, to deliver on the approaches to crisis management its representatives had laid out at Jackson Hole. BlackRock’s most high-profile and strategic engagement, however, began with its involvement in the negotiation of the $2 trillion CARES stimulus package that passed through the US Congress in March of 2020.
The CARES Act included $367 billion for loans and grants to small business, $130 billion for health care systems, $150 billion for state and local government, $500 billion for loans to corporate America, and $25 billion for airlines (in addition to loans).
The heart of the plan involved a payout of $1,200 per adult and $500 per child for households making up to $75,000. This payment to citizens approaches the concept of disseminating “helicopter money” as referred to in BlackRock’s initial outline for dealing with the “downturn.” Helicopter money distributed by the federal government to its citizens was also related to the concept of “going direct” in strategies for stimulating the economy.
BlackRock seems to be moving into the space recently held by Goldman Sachs as Wall Street’s best embodiment of ostentatious success including in the preparation of its corporate leaders for high-ranking positions in the federal government. Laurence Fink, BlackRock’s founder and CEO, might well have replicated this career path to become Treasury Secretary if Hillary Clinton had succeeded in becoming US President in 2016.
BlackRock’s leadership went to great lengths to avoid being tagged with the title in the United States of a “systematically important financial institution” (sifi). To be subject to this “sifi” label entails added federal scrutiny and regulation as well as heightened requirements to keep high amounts of capital on hand. BlackRock’s status as a private company not subject to sifi regulations makes the financial management firm more attractive to its federal partners in the federal payout operation presently underway.
One of the reasons for including a private company in the trio of partners involved in the payouts is to sneak around limitations on the legal powers of the Federal Reserve. As explained by Ellen Brown in her essay, Meet BlackRock: The New Great Vampire Squid, the Federal Reserve can only purchase “safe federally-guaranteed assets.” As a private company, BlackRock apparently faces no such restrictions. It can purchase more risky assets not backstopped by federal insurance.
The regional banks of the Federal Reserve Board are owned by private companies whose directors seem to have been part of the decision to include BlackRock in the implementation of the CARES process. There can be no doubt that the format of the CARES negotiations pulled the supposedly independent Federal Reserve more deeply into the political orbit of the US Treasury branch. The presence of a major Wall Street firm in the process, however, apparently gave the advocates of the Fed’s supposed independence from politics a sense that they retained some leverage in the process.
The inclusion of private companies in the conduct of government business has become in recent decades a very common expression of neoliberalism. One of the reasons for this embrace of public-private partnerships in the conduct of government business is to take advantage of the legal nature of private companies. The apportionment to private companies of significant roles in deciding and implementing public policies helps put veils of secrecy over the true nature of government decisions and actions.
Private companies can more easily assert claims to “proprietary information” than can public institutions when they act on behalf of citizens. This feature of privatization in the performance of public responsibilities by elected government runs counter to the imperatives of democratic transparency. It puts obstacles in the way of genuine accountability because the public is more likely to be kept in the dark about key aspects of what is being decided and done on their behalf.
Suck Up Economics and State Monopoly Capitalism
BlackRock owns, controls, or manages about $30 trillion in total in securities. It directly controls or owns somewhat less than a third of this amount. The remainder of the assets BlackRock manages are to service clients responsible for taking care of pension funds, philanthropies, foundations, endowments, family offices, superannuation funds and such.
A big part of BlackRock’s business model involves attracting customers by allowing them access to great masses of timely information of significant utility to those responsible for making investment decisions. This technological wizardry happens on a very advanced computational platform known as Aladdin.
Aladdin remains a work-in-progress, one that is widely recognized as the most sophisticated medium of its kind for assessing all manner of financial risks and potentials for profit. Its future as an investment platform is to become more and more integrated into the complex mix of hardware and software animating Artificial Intelligence.
BlackRock’s job is to dispense funds ushered into existence through the money-creating powers of the Federal Reserve. These transactions are to take place through eleven so-called “special purpose vehicles” similar to the Maiden Lane companies that BlackRock administered during the prior bailouts.
The funds it distributes in this round starting in 2020 are meant, at least at this early stage of the crisis, as payments for various sorts of assets. These assets might include an array of corporate bonds spanning a range from so-called investment grade to garbage grade junk bonds. The losses incurred in this exchange, involving supposed assets that might turn out to be worthless, or loans that might not be paid back, are to be charged to the US Treasury. Ultimately the liability lies on US taxpayers who are the holders of the national debt.
Bonds of varying levels of worth lie beneath another asset eligible for transformation into cash. This instrument of value is referred to as Exchange Traded Funds, ETFs. ETFs happen to be a specialty of BlackRock ever since the company launched a range of commercial ETFs into Stock Market circulation through its iShares division. BlackRock’s role on both sides of buying and selling ETFs comes up repeatedly as one of the many conflicts of interest of which the Wall Street firm stands accused.
Given that BlackRock is involved in one way or another in the proprietorship of pretty much every major company in the world, there is plenty to back up the allegation that Black Rock is an interested party in most of the transactions in which it engages as part of its partnership with the US Fed and Treasury Branch.
Pam Matens and Russ Martens have been very critical of the role of the Federal Reserve and BlackRock in the current economic crisis. They have anticipated that, if the current drift of events continues, American taxpayers will once again be gobsmacked with a huge growth in the national debt. This development would amount to another major transfer of wealth away from working people to the beneficiaries of Wall Street firms and the same commercial institutions that received the lion’s share of funds during the last bailout.
The co-authors picture BlackRock is part of a scheme to use “Special Purpose Vehicles” like “Enron used to hide the true state of its finances and blow itself up.” They entitle their article published on 31 March, 2020 as “The Dark Secrets in the Fed’s Wall Street Bailout Are Getting a Devious Makeover in Today’s Bailout.”
The authors observe. “What makes the New York Fed’s bailout of Wall Street so much more dangerous this time around is that it has decided to use a different structure for its loans to Wall Street – one that will force losses on taxpayers and, it hopes, will provide an ironclad secrecy curtain around how much it spends and where the money goes.”
I find this account of an effort by the Federal Reserve to create an “ironclad secrecy curtain” shocking under these circumstances. It suggests an intention to exceed the deceptiveness of the last bailout. This warning renews longstanding suspicions that the failures of transparency and accountability have not subsided since the beginning of the era when deregulation and the 9/11 deceptions converged in the domestic and international operations of Wall Street.
The structural problems already identified in the process initiated to implement the CARES Act could have enormous consequences if the current economic crisis continues to deteriorate. This deterioration is not likely to stop anytime soon given the depth of the crash and its probable domino effects. It was reported in late July that during the second quarter of 2020 the US Gross Domestic Product collapsed at an annualized rate of 33%, the deepest decline in output ever recorded since the US government began measuring GDP in 1947.
The CARES Act helped set in motion a program with the potential to repeat elements of the earlier bailout. The amount of $454 billion was to be set aside to assist the banking sector. The Fed can leverage this amount by ten times according to the principles of fractional reserve banking.
The news of this development caused Mike Whitney to imagine “the Fed turning itself into a hedge fund in order to buy the sludge that has accumulated on the balance sheets of corporations and financial institutions for the last decade,” Whitney pictured an onslaught of “scheming sharpies who will figure out how to game the system and turn the whole fiasco into another Wall Street looting operation.”
Meanwhile the Martens Team at Wall Street on Parade called attention to the $9 trillion already injected by the New York Fed to flood liquidity into the still-troubled Repo Markets that began to falter in September of 2019. Add to this revelation the news that the Fed “has not announced one scintilla of information on what specific Wall Street firms have received this money or how much they individually received.”
There is no doubt that the nature of economic relations will be substantially altered in the process of dealing with the financial meltdown induced by the lockdowns and by the overreliance on high debt rates combined with artificially low interest rates prior to 2020. The altered political economy that is beginning to emerge following the lockdowns is sometimes described as state monopoly capitalism.
In deciding what companies get bailed out and what companies don’t, the financial authorities that are intervening in this crisis are pretty much deciding what enterprises get the advantage of federal financial backstops and what enterprises will not enjoy government sanction. Increasingly, therefore, it is the state that determines winners and losers in the organizing of financial relations. This development further undermines any notion that some idealized vision of competition and market forces will determine winners and losers in the economy of the future.
As Peter Ewarts has observed, it seems that BlackRock is being delegated by federal authorities to exercise “discretionary powers to pick winners and losers,” a choice that is “where the real bonanza and clout lies.” Will the winners be chosen from the companies run by executives that used the money gained from the prior bailouts to engage in stock buy backs? This process of buying back stock tends to be reflected in CEO bonuses and higher share prices. Alternatively this way of allocating funds tends to short change workers as well as innovation and efficiency in industrial production?
Will companies be rewarded whose executives have moved production facilities overseas or issued billions in junk bonds? Will companies be rewarded whose directors have participated in the effort to censor the Internet, bring about lockdowns or foment mask hysteria? Why is it that the coddled elites serving the financial imperatives of most wealthy branches of society are being put in the best position to decide who gets a life preserver from the state and who must sink and drown?
Might this bias be a factor in the current process that led Forbes Magazine to conclude in a headline that “Billionaries Are Getting Richer During the Covid-19 Pandemic While Most Americans Suffer.”
There can be no doubt that the financial transactions beginning with the CARES Act represent a crucial initial stage in what the promoters of the World Economic Forum have been labeling as the Great Reset. Laurence Fink and the BlackRock firm are significant participants in the World Economic Forum. The WEF helped introduce the pandemic in Event 201 in October of 2019 even as it is now trying to put a positive face on the fiasco.
Why should the people most harshly affected by the lockdowns tolerate that the very Wall Street interests dispossessing them, are tasked once again to lead and exploit the reset of the financial system? As presently structured by the likes of BlackRock and its beneficiaries, this process is once again transferring new wealth to the most wealthy branches of society. Simultaneously it is burdening the rest of the population with yet another massive increase in both personal and national indebtedness.
There is no more discussion of “trickle down” economics, a frequent metaphor invoked in the Reagan-Thatcher era. Instead we are in the midst of an increasingly intense phase of suck up economics. The rich are being further enriched and further empowered through the dispossession of the poor and the middle classes. This procedure, initiated when locked down citizens were sidelined from the political process, has the potential to result in the largest upward transfer of wealth so far in history.
BlackRock Versus the Debt-Lite Legacy of the Bank of Canada
At the end of March Laurence Fink, CEO and founder of BlackRock, announced in a letter to his company’s shareholder, “We are honored to have been selected to assist the Federal Reserve Bank of New York and the Bank of Canada on programs designed to facilitate capital to businesses and support the economy.”
This announcement might leave the impression that the Bank of Canada and the Federal Reserve Bank of New York are similar institutions. This impression is unfounded. The two banks have very different structures and histories. A spotlight on these differences helps illuminate the nature of a number of core financial issues.
These financial issues should command avid attention during this time of reckoning with a serious economic crisis that may well be still in its early stages. Such issues inevitably draw attention to the current manifestations of very old questions about the character of money and its relationship to the concepts of usury and debt. Questions about debt, debt enslavement as well as the possibility of debt renunciation or debt forgiveness are becoming especially pressing.
These controversial queries arise in an era when a tiny minority is aggressively asserting sweeping claims to ownership of vast concentrations of the world’s available assets. The other side of this picture reveals that the largest mass of humanity is sinking into a swamp of rising debt on a scale that is concurrently unsustainable and unconscionable. How did this level of inequity reach such audacious extremes? Are there any remedies in sight?
There is nothing to suggest structural remediation in the current approach to the economic crisis. In fact so far there is every indication that the current approach of bringing about an enormous expansion in the availability of debt-laden money will only compound the further dispossession of the already dispossessed in order to expand the wealth of the already wealthy.
As already noted, the Federal Reserve Bank of New York is one of twelve regional banks that together constitute the US Federal Reserve. Every regional Federal Reserve Bank is owned by a group of private banks. Each of the private banks at the base of a Federal Reserve regional bank marks its proprietorship through the ownership of shares. These shares cannot be freely traded in stock markets. The ownership of these shares expresses the private ownership of the US banking system.
The Fed’s New York regional bank has a special role in money creation given its location at the heart of the US financial sector on and around Wall Street. In this crisis, the Federal Reserve Bank of New York is creating new money in the name of holding back onslaughts of destitution and penury in a traumatized society. Ever since 1913 every new dollar brought into existence by the Federal Reserve, which is the central bank of the United States, creates added debt that collects compound interest as long as it is left unpaid.
The Bank of Canada was created to counter the delegation of money-creating authority to privately-owned banks. The Bank of Canada was founded during the Great Depression, a time when the failure of many existing institutions created the conditions to try out alternative entities in the attempt to improve economic relationships.
One of the driving forces in the creation of Canada’s new banking system was Gerald Gratten McGeer. McGreer was an elected official in British Columbia dedicated to changing the system so that the people of Canada could generate their own currency through the sovereign authority of Canada’s Parliament. McGeer helped to push the national government of Prime Minister R.B. Bennett in this direction. The wheels were set in motion in 1933 through the work on the Royal Commission on Banking and Currency.
McGeer drew much of his inspiration from former US President, Abraham Lincoln. Lincoln led the US federal government throughout the US Civil War. To finance the Armed Forces of the Union, Lincoln used the authority of the federal government to create “Greenbacks” as a means of paying the troops. By employing the sovereign authority of the US government to create its own currency, Lincoln avoided the intrigues that often accompanied the process of borrowing money from foreign lenders.
McGreer had obtained what he viewed as credible evidence that Lincoln had been assassinated because of his antagonism to the designs of private bankers seeking to widen their base of power in the United States. The Canadian politician had taken to heart a comment attributed often to Lincoln: “The privilege of creating and issuing money is not only the supreme prerogative of Government, but it is the Government’s greatest creative opportunity.”
The Bank of Canada was created in 1934 and nationalized as a Crown Corporation in 1938. To this day it retains its founding charter that affirms,
WHEREAS it is desirable to establish a central bank in Canada to regulate credit and currency in the best interests of the economic life of the nation, to control and protect the external value of the national monetary unit and to mitigate by its influence fluctuations in the general level of production, trade, prices and employment, so far as may be possible within the scope of monetary action, and generally to promote the economic and financial welfare of Canada.
The Bank of Canada formed an essential basis of a very creative period of Canadian growth, development, and diversification throughout the middle decades of the twentieth century. The Bank of Canada created the capital that financed the Canadian war effort from 1939 until 1945. After the war the Bank of Canada lent money at very low rates of interest to the municipal, provincial and national governments. The monies were used for infrastructure projects and for investments to increase the wellbeing and creative potential of Canada’s most important resource, its people.
This type of low interest or no interest financing formed the economic basis for projects like the creation of a national pension plan, national health care insurance, the Trans-Canada Highway, the St. Lawrence Seaway, the Avro-Arrow initiative as well as a formidable system of colleges and universities.
One could say that the Bank of Canada provided an indigenous money supply that was spent into the operations of a fast growing economy greased with lots of federal liquidity. The new money derived its value from the efforts of Canadian workers. Together they brought about significant increases in the country’s net worth through practical improvements that bettered the lives of all citizens.
Consider the contrast between this type of national development and the kind of larceny facilitated by the Federal Reserve’s infusions of the money it creates into Wall Street’s operations in the twenty-first century. In, for instance, the financial bailouts of 2007 to 2010 the largest part of the newly-created money ended up in the coffers of the wealthy whereas the new debt created ended up as part of a US national debt.
The burden of carrying this debt falls inter-generationally on average working people who form the lion’s share of taxpayers. They have long been saddled with an “inextinguishable debt” that unrelentingly grows, hardly ever shrinks, and remains basically unpayable forever. The very concept of “compound interest” conveys the image of an overall debt spread out over many venues. This debt must grow in perpetuity. There is a constant need for additional debtors while existing debtors must face constantly growing personal debt.
There is reason to suspect that the financial debacle of 2020 will re-enact some the worst excesses of the 2008 bailout. Might the payouts this time around to derivative-addicted Wall Street firms like Citigroup, Goldman Sachs and JP Morgan Chase exceed the scale of the prior bailout? Would there be any way of even knowing whether the current round of payouts outdoes the former round of bailouts? The current process of federal disbursements is not transparent. In fact the process has been described as one designed to “provide an ironclad secrecy curtain around how much [the Fed} spends and where the money goes.”
Why is the Canadian government turning to the very firm that emerged as Wall Street’s main fixer and winner in the 2008 bailouts? Why is Justin Trudeau looking to BlackRock to respond to the Canadian aspects of the 2020 economic crash?
Justin Trudeau seems unwilling or unable to provide a coherent answer to this question and others requiring thoughtful replies rather than barrages of platitudes. Why is Justin Trudeau instituting what Joyce Nelson has characterized as a “new feudalism” in Canada’s economic policies?
Any decent effort of response on Trudeau’s part would have to make some reference to the background of the current debacle. There would have to be some acknowledgment that between 1934 and 1974 the Canada government did not build up any significant national debt. Then, between 1974 and 2020, the national debt of Canada skyrocketed from $22 billion to $700 billion.
Why was such a good and sustainable use of the Bank of Canada put aside, one that contributed magnificently to the health and wellbeing of the Canadian people as well as the Canadian federation? Who lost out? Who gained besides the international bankers?
The incomprehensible abandonment of a winning formula for Canadian development by Prime Minister Pierre Trudeau puts a special onus on his son, Canada’s current PM, to explain the incredibly costly mistake of his father. Why won’t Justin Trudeau fix the mistake of his father and restore the Bank of Canada to its former role in Canadian nation building?
There has never been a full and satisfactory explanation of what really happened in 1974 to persuade Pierre Trudeau to throw aside the means of developing infrastructure with resources generated internally within Canada. Trudeau Senior’s decision to stop building up Canada through the operation of the Canadian people’s own national bank was not debated in Parliament. The option was never part of an election platform let alone the subject of a national referendum.
Apparently the Swiss-based Bank of International Settlements, which is often referred to as the central bank for central bankers, had some role in Pierre Trudeau’s decision to cease using the Bank of Canada’s powers to generate near-debt-free Canadian currency.
Government as a Means of Escaping Debt Entrapment
That powers of debt-lite money creation invested by Parliament in the Bank of Canada have never been formally withdrawn. The Bank of Canada could still revert back to the direct creation of Canadian currency to be spent into an economy of national recovery; to be spent in investments in infrastructure as well as in cultivating and applying the creative skills of the Canadian people.
Between 2011 and 2017 a court case was brought against the government of Canada with the aim of restoring the Bank of Canada to its former role. As Rocco Galati, the lawyer for the Committee on Monetary and Economic Reform (COMER) explained “Not only has the government abandoned its constitutional duty to govern, but it has transferred it to international private banks which corresponds to an abandonment of its sovereignty.”
After some significant rulings and contentious appeals, the COMER case came to an end without delivering results that its plaintiffs sought. But the court case helped to put a spotlight on the potential of the Bank of Canada. If properly utilized, this institution could provide a model corrective to the subordination of governance to the international Lords of Debt Explotation and their minions.
This process of politicizing the role of the Bank of Canada should extend to a process of calling out Justin Trudeau’s current approach to selling off key components of Canada’s infrastructure.
This topic came up in private discussions between Larry Fink and Justin Trudeau at the World Economic Forum in Davos in January of 2016. Fink apparently got Trudeau interested in attracting private investors to the project of improving or building Canadian infrastructure projects like roads, high-speed trains, airports and such. This kind of approach to developing infrastructure projects runs counter to the role once played by the Bank of Canada in incorporating self-sufficiency into the process of national building.
The dangers and opportunities in this time of manufactured crises are indeed unprecedented. Instead of rejecting the Davos crowd’s preoccupation with a giant reset, why not embrace the concept? Why not treat this moment as an opening to reset the global economy in a way that would restore the Bank of Canada to some of its former functions. Why not highlight this return to the sovereign embrace of benevolent nation building as an example for the rest of the world?
Why not reconstitute the worldwide structures of the international system of economic relations to restore elected governments to the functions that have been pre-empted by unaccountable institutions like the US Federal Reserve or the Bank for International Settlements? Why not renew the model of banking as an exercise and expression of national sovereignty and the self-determination of peoples in a dynamic global arena of rules-based economic interaction?
Why not withdraw the power from private bankers to create national currencies? Why not follow the advice of the deceased Abraham Lincoln by restoring “the greatest of all creative possibilities available to governments,” namely their power to issue money and set interest rates. The restoration of economic power to governments and the people and peoples they represent would involve the infusion of life into conceptions of globalization very different than those used to justify the industrialization of China and the deindustrialization of North America.
By delegating to international organizations much of their capacity to influence the economic conditions affecting their own people, national legislatures have lost much of their capacity to provide responsible government. Governments thus weakened are not realistically in a position to derive their authority from the consent of the governed. When representative bodies cannot effectively express the right of their constituents to collective self-determination in economic realm, what legitimacy is left to the institution of representative government?
This strange moment puts humanity face to face with much that is novel and unprecedented and much that is old and integral to the history of human interaction. The economic dimensions of this crisis constitute its most devastating and far-reaching attribute. The supposed remedy being rushed into operation is to flood large quantities of debt-laden loans into existence and for governments to distribute the borrowed funds to individuals, businesses, and organizations as they see fit.
Once again, vast quantities of debt-laden money are being created without the informed consent of those on whose shoulders the vastly increased loads of debt are falling. Once again governments are rewarding political friends and punishing political enemies by means of the way the new funds are being apportioned.
Decisions are pushed forward that emanate not from citizen constituents but from cabals of supranational connivers actively engaged in wrecking what little remains of responsible government. As governments lose legitimacy by engaging in collusion with corrupt cronies and international crime syndicates they must depend more and more on police state thuggery to enforce some semblance of order.
This process is going forward in spite of the fact that alternative means exist to create as much new money as is required without having to pay large amounts of compound interest to private bankers. Every sovereign government has the capacity to generate new money by following the model of the Bank of Canada between 1938 and 1974.
There is an especially urgent need at this time for some serious reckoning with the economic dimensions of the crisis before us. This reckoning will inevitably meet the resistance of extremely powerful interests who are deriving great benefits from the existing system. The process of privatizing the creation of money has enriched and empowered a clique whose institutionalized, deep-rooted and continuing kleptocracy was exposed in part by the bailout of 2008.
Why should we take for granted in 2020 that the best way to deal with the economic debacle put before us is to create new money by agreeing to go much deeper into a quagmire of debt entrapment. This debt trap, whose cumulative amount will soon be more that $300 trillion globally, creates gross liabilities in a trajectory of disadvantage that severely limits the life chances even of many generations still unborn.
The other side of debt is embodied in assets. Who gets the assets and who gets the liabilities that coalesce to form indebtedness? What is to be made of the role of birth or inheritance or race or natural ability or social connections in apportioning assets or imposing the enslavements of accumulated debt?
John Perkins addressed some of these issues in his Confessions of an Economic Hit Man and in a subsequent follow-up volume. Perkins chronicled how an inter-related complex of US institutions aligned themselves with his own greedy and unscrupulous interventions. The goal of their coordinated aggressions was aimed at imposing the enslavements of massive debt with compound interest. Their version of loan sharking is one of many manifestations expressing a very old and common phenomenon. It often happens that powerful interests parasitically exploit the weak to further enrich themselves.
This partnership between John Perkins and the kleptocratic agencies directed by the US government has long been drawing wealth from struggling countries by pushing them more deeply into national indebtedness. Once the governments of target countries succumbed to greater dependence on debt-based financing, the conditions were ripe to force officials into adopting policies of austerity that harmed local citizens in order to augment the assets of international investors.
Significantly the World Bank demonstrated how this coercion works in the context of the current economic crisis. The World Bank attempted to impose conditions on a loan of $940 million to Belarus because the WB wanted Belarus to conform to the lockdowns that are a primary cause of the current manufactured crisis.
As revealed by the Belarus’s President, Alexander Lukashenko, the World Bank wanted his country to adopt the full set of COVID-19 measures that had been implemented by the Italian government. Lukashenko said no to the loan. He refused to accept the conditions and carried on the established policies of Belarus, a country that has “not implemented strict coronavirus containment measures.”
Lukashenko is far from alone in his contempt for the manipulative tactics of the apparatus promoting the manufactured crisis. For instance Tanzanian President, John Magufuli, tested the accuracy of the testing procedures being forced on his country by the World Health Organization. President and Medical Doctor Mugufi included in the samples submitted to the testing agency some tissue of a goat and a papaya. Both the goat and the papaya tested positive for COVID-19, an outcome he publicized before ordering the WHO group to leave his country.
The Political Economy of Usury From the Middle Ages to the Era of Social Credit and Ezra Pound
We cannot assess the division of humanity between a massive group of debtors and a much smaller group of creditors without touching on the issue of usury. The subject of usury, the lending of money with the addition of interest payments, has been an extremely contentious issue throughout much of human history.
There were prohibitions against usury in ancient Greece, ancient India and the Roman Empire. Throughout much of the last thousand years usury has been regarded as a sin outlawed in the Bible, the Torah and the Koran. At different times in history the Roman Catholic Church has been an especially zealous opponent of some forms of usury.
Considering the nature of our current predicaments including obscene levels of economic inequality, usury might yet again arouse contentions. Some of the core ethical issues raised by the resort to usury remain unresolved. How is it ethical, for instance, to subject disinherited children in poor countries to the indignities of deepened poverty so that rich folks in rich parts of the world can reap larger dividends?
Beginning in the Middle Ages, forms of usury began to show up first in the Italian city states and in the towns of the Franco-Flemish realm. The act of loaning money with interest gradually spread throughout Europe. In some predominately-Muslim jurisdictions, the concept conveyed in the Arabic term, “riba,” approximated the idea of usury or interest. Over time various versions of riba have affected Muslim banking practices.
Often there were prohibitions preventing Jews from demanding interest on loans made to other Jews. There were many Talmudic teachings, however, permitting interest to be collected from gentiles when they borrowed money from Jews. Many accounts of Jewish efforts to break down prohibitions on usury highlight obstacles preventing Jews from pursuing other lines of work. The case is made that the pull of some Jews into banking came about in part because of their exclusion from other occupations.
Whatever the case, the obstacles to usury continued to be lessened including through the changes to Biblical interpretation that came with the Protestant Reformation. Even in the twentieth century, however, usury continued to arouse criticism and distrust. Ezra Pound was one of those who became very outspoken when it came to problems with usury.
The modernist poet and scholar, Ezra Pound, was one of the most influential literary figures of the twentieth century. The importance of his work was expressed not only in his own literary efforts but also in his contributions to other authors in his circle of friends and colleagues.
Pound’s outspoken criticism of usury formed part of the discourse that was integral to the political movements seeking economic reform. The creation and successful nationalization of the Bank of Canada was one of the outgrowths of the concerted quest to give substance to economic institutions that would more effectively serve human needs.
The creation of the Bank of Canada drew on the ideas of Abraham Lincoln and also on those of many other theorists including Major C.H. Douglas. While Major Douglas and John Maynard Keynes each denounced one another’s work, both sought to stimulate economic activity by expanding the supply and distribution of money. Major Douglas’ vision of Social Credit, one that Pound enthusiastically embraced, sought to bring about greater harmony and equilibrium between the forces of production and consumption.
A biographer of Pound has explained that this formidable literary figure believed “there was the prospect of building a Social Credit society where money served the consumer and served the producer.” As Pound pictured it, “the middle men” seeking usurious, interest bearing profit” to be collected “without work or prior motivation, could be cut out.” During the Depression the hope of prosperity through the application of Social Credit principles was seized upon by many. One of them was an evangelical preacher in the Canadian province of Alberta.
Largely as a result of the popularity he gained by incorporating Major Douglas’ analysis of Social Credit into his Sunday afternoon Christian radio broadcast, “Bible Bill” Aberhart became the Premier of Alberta. His Social Credit Party gained 56 of 63 seats in the Alberta Legislature. The Social Credit Party continued in power until 1971.
The Social Credit preoccupation with bringing about changes in the relationship of citizens to financial institutions helped add to the discourse from which the Bank of Canada emerged as a dynamic instrument of nation building.
The enthusiasm was well placed of those who threw their lot in with the movement to create and enlivened the Bank of Canada. The generations that put their trust in this federal financial institution had the satisfaction of knowing that their taxes were not devoured to pay big amounts of interest to private bankers in the style that presently prevails almost everywhere.
Like his good friend and colleague, Ernest Hemingway, Pound was a devotee of clear, terse and succinct prose.
This characteristic of his writing comes through strongly in his harsh condemnations of usury. “Usury is the cancer of the world,” Pound wrote. He explained, “Until you know who has lent to whom, you know nothing of politics, you know nothing whatever of history, you know nothing of international wrangles.”
Ezra Pound was born in Idaho but was attracted to Italy throughout long periods of his life. In Italy he lionized its fascist leader, Benito Mussolini. He embraced the Axis side in World War II developing close relations with the British fascist leader, Oswald Mosley. Pound threw himself into the contest producing a torrent of radio broadcasts seeking to win over English-speaking converts to the Axis side. These broadcasts are today widely described as war propaganda.
Pound was indicted in the United States in 1943 and arrested at the war’s end by the US Armed Forces in Italy. After being jailed in Pisa, Pound was charged with treason. Then Pound was diagnosed as being mentally unfit to face charges.
The finding that he was mentally ill caused Pound to be locked up as a patient in St. Elizabeth’s Hospital in the Washington DC area for the next 13 years. In spite of his severe prejudices against Jewish bankers and his active embrace of fascism during the war years, Pound continued to carry on very lively interactions with his formidable circle of poets, essayists and novelists.
Pound’s circle included James Joyce, Ernest Hemingway, and T.S. Eliot. All these writers wrote works that won a Nobel Prize for Literature. These and many other authors benefited from Pound’s encouragement and mentorship. In 1948 Eustace Mullins joined Pound’s circle. Mullins was introduced to the famous poet and scholar through Pound’s wife, Dorothy Shakespeare,
When he first met Pound, Mullins was an art school student and a veteran of the US Air Force. He had already published some short pieces in the British journal, Social Creditor. Mullins remembered Pound’s place of forced residence as “a hideous, urine-soaked madhouse in Washington D.C.” As their visits became increasingly regular, Pound encouraged Mullins to conduct research into the history and activities of the Federal Reserve.
When Pound proposed the idea Mullins was unaware of the existence of the Federal Reserve. Nevertheless, Mullins threw himself into the project that he supported by combining his research with work as a book stacker at the Library of Congress. At the Library he befriended George Stimpson who was well known among Washington journalists and government officials for his wealth of knowledge and his ability to locate relevant research materials.
Stimpson happily worked with Mullins. He helped the aspiring author by guiding him into the primary and secondary literature illuminating many facets of the Federal Reserve’s history
Eustace Mullins Explores the Secrets of the Federal Reserve
An initial edition of the volume appeared in 1952 as Mullins on the Federal Reserve. Another edition with added information was published in 1954. The text has been republished many times, sometimes in different editions under the title Secrets of the Federal Reserve. The text is organized around both thematic and chronological facets.
Mullins lays out the history of the Federal Reserve with considerable attention to the institution’s roots and origins. The author emphasizes several strands of continuity showing the links of the Federal Reserve to the banking establishments of Europe but especially those of Great Britain and Germany.
Mullins characterizes the Federal Reserve as the most powerful institution in the United States whose influence grew so that “it gradually superseded the popular elected government of the United States.” The power of the Fed and its core facet, the Federal Reserve Bank of New York, is said to have become so formidable because the agency operates in secrecy without any genuine form of accountability to any public institution. The NY Fed combines the power of secrecy with the enormous power to create new currency and to set interest rates becoming in the process “the most gigantic trust on earth.”
Mullins makes the case that the financial district known as the City of London exercised enormous influence over the activities of the Federal Reserve and many of the large Wall Street banks. Mullins wrote, “London is the world’s financial centre, because it commands enormous sums of capital created at its command by the Federal Reserve Board of the United States.”
Mullins is conscientious in presenting many citations to back up his observations and interpretations. He cites, for instance the New York Times on January of 1920 where it states, “The Federal Reserve is a fount of credit not capital.” The manipulation of credit, however, can greatly affect the industrial economy by affecting the ability of manufacturers and farmers to produce.
Mullins emphasizes throughout the text how events are often engineered to strengthen the hand of the Lords of Credit in the matrix of society’s operations. In referring, for instance, to a secret banker’s plan to crash the stock market in 1929, Mullins expressed a view that could as easily describe the growing suspicion in 2020. Could it be that the lockdowns of businesses and workers were purposely engineered to strengthen the hands of the Lords of Credit whose main platform is the Federal Reserve Bank of New York?
Mullins explains that sometimes “bankers paralyse the industrial energies of the country” in order to highlight and strengthen “their tremendous powers” over the financial and business organization of the American economy. Mullins’ observation that “panic is an instrument of [financial] power” is another statement with obvious relevance to the current crisis.
As have many authors since, Mullins emphasizes the importance of a top-secret meeting on Jekyll Island in the state of Georgia in 1910. At this meeting Paul Warburg essentially took the intellectual lead in creating a plan for a Central Bank in the United States. Such an institution was long contemplated and promoted but it had been stopped repeatedly, most famously be Andrew Jackson. Jackson’s political career culminated in his winning the US presidency between 1829 and 1837.
Warburg left his family banking business in Hamburg Germany in 1902. He joined the Wall Street Office of Kuhn Loeb, a Wall Street House that helped finance the Bolshevik Revolution in Russia. Mullins devotes much effort to describing the complex of alliances and rivalries that characterized banking before and after the founding of the Fed.
Weaving throughout these networks of financial activity were the banking operations of the Rothschild family. Mullins leaves no doubt that the operations of the Rothschild family of bankers were extensive, elaborate and very influential.
In the nineteenth century the Rothschild banking establishment gradually wove its operations into those of large segments of Europe’s royal and aristocratic establishments. Mullins emphasizes the genesis of the close business relationship between the Rothschild banking clan and a London-based US company, George Peabody and Company.
Peabody’s bank was passed on to a father and son team, Junius Spencer Morgan and John Pierpont Morgan. In the days of the Fed’s founding and even today, the name of J.P. Morgan is synonymous with New York banking. Mullins explains how the Rothschild bankers kept a fairly low profile in New York by conducting much of their American business largely through the financial organizations associated with the name and reputation of J.P. Morgan.
Mullins outlines the role of the Federal Reserve in the funding of two world wars. Many of the topics covered in Secrets of the Federal Reserve were later pursued in much more detail in the prolific writings of Antony C. Sutton.
Most of Sutton’s volumes describe the role of Wall Street in helping to bring about many of world history’s major turning points during the twentieth century. These turning points include Wall Street’s funding of the rise of the National Socialist government in Germany in the 1930s and the role of Wall Street in financing the Bolshevik Revolution and the business activities of the Soviet Union.
The capacity of the New York Bank of the Federal Reserve to create vast quantities of credit to finance wars, often with the same bankers funding competing sides in conflicts, provided the key to the creation of huge fortunes. The funding of both sides in war can be seen as an early form of hedging one’s bets. This kind of high impact intervention through banking sometimes created huge leverage for a very small number of people to steer history towards preconceived destinations.
As Mullins explains it, the Federal Reserve was founded in extreme secrecy and often employs deceptive tactics to misrepresent its true nature. As Mullins sees it, for instance, the creation of the twelve regional banks was a ploy to gain political acceptance for the Central Bank’s core entity, the Federal Reserve Bank of New York. Mullins explains, “the other eleven banks were so many expensive mausoleums erected to salve local pride and quell the Jacksonian fears of the hinterland.”
The ability of Wall Street bankers to invoke the credit creating powers of the New York Fed forms a key aspect of the frequent military adventurism of the US government. This military adventurism continued full force even after the United States became the world’s largest debtor nation after 1990. How large has been the role of the US Fed in building up the US national debt together with the tens of trillions missing from the books of the US Defense Department?
The Israel Lobby and the Federal Reserve
Much of the military adventurism of the United States especially after 9/11 was directed into invasions of Muslim-majority countries that threaten a particular view of Israel as a dominant power in its region and in the world. Why would it be that the Federal Reserve is any less involved in creating the available credit for the waging of wars in the twenty-first century than it was in creating the wars of the twentieth century?
In his authorship of The Secrets of the Federal Reserve, Mullins seems largely oblivious to the role in world history of Zionism and the genesis of Israel. His main attention lay elsewhere. As I read his text, he accurately conveyed how the large Jewish influence in the banking institution of Europe, including the influence of the Rothschild consortium, was extended into Wall Street including the Federal Reserve.
While Mullins does not shy aware from dealing with the Jewish component of the story he set out to tell, I don’t think he belabours this subject or becomes aggressively polemical about it. Certainly the same cannot be said of some of his critics whose condemnations of Mullins can sometimes be extremely polemical.
Mullins might have made more of the identity politics prevailing throughout the twentieth century. The sensibilities of the dominant Christian constituency in the United States probably influenced the decisions of many customers shopping for banking services. Quite likely some of them would have been more comfortable dealing with firms identified with names like J.P. Morgan, Rockefeller and Mellon rather than Warburg, Greenspan or Fink. Times, however, have changed.
Some of the more severe prejudices seem to have subsided around the time that Sandy Weill combined his Travellers Insurance Company with Citicorp to create Citigroup. This merger helped create the political momentum leading to the elimination of the Glass-Steagall Act in 1999. With Glass-Steagall’s elimination, Citigroup tried to become a giant department store of varied financial services. In its inner sanctums, however, Citigroup developed a preoccupation with derivatives that continues yet.
In the twenty-first century it happened that some of the cosmetic overlays were removed that had previously been imposed to disguise the large representation of Jews in Wall Street banking, including in the Federal Reserve Bank of New York. For good or bad, usury has become a core features of how the contemporary world is organized. Some reckoning with the ethnic inheritances attending usury are therefore inescapable, especially when dealing with the some of the most dramatic displays of usury on steroids in Wall Street institutions.
Where I see the need to draw a line in the sand is not on the question of the ethnicity of Wall Street personnel. Rather this line in the sand involves the question of how power is used or abused at the domineering heights of our financial institutions. Generally speaking it is not a justifiable use of the Federal Reserve to produce credit that enables the waging of wars that are offensive rather than defensive in character.
The waging of war has long been one of the big bonanzas producing major windfalls for international bankers. In the twenty-first century so many of the wars involve the flexing of military might by the United States to advance the expansionary designs of the Israeli state. The US Federal Reserve has been part of the process of creating what some would consider wars for Israel in Iraq, Syria, Yemen and Iran.
Why are the money-generating powers of the secretive Federal Reserve being invoked to help fund wars for Israel and also to help shape public opinion to accept the US role in these wars of aggression. Especially sensitive is the further indebting of the American people to subsidize the production of propaganda aimed at persuading them to back wars for Israel. This propaganda is deemed necessary to deflate opposition to Israel’s actions including the ruthless dehumanizing treatment of Palestinian Arabs.
We have seen that the Federal Reserve Bank of New York was deeply engaged in 2008 in transferring tens of trillions into the coffers of its own member institutions and counterparties. What uses were made of this bailout produced through a dubious process of legalized financial larceny?
One way or another the Israel Lobby must be a prime beneficiary of the machinations of Wall Street and its money spigot, the Federal Reserve Bank of New York. This pattern of priority can easily be related to US federal funding of the Israel project as a higher priority in federal budgeting than even the basic needs of the domestic population of the United States. Black Lives Do Matter but why is it that the lives of Israel First Partisans seem to matter more than any other group?
This Israel Lobby has the power to prevent any critic of Israeli policies from gaining the nomination of a major US party to run for US president. The result is that, in election after election, Americans are offered a very limited choice between competitors who are equally supportive of Israel.
The Israel Lobby can intervene to prevent the leadership of opposition parties from adopting policies that emphasize equity in Israel-Palestinian relations. Through its campaign contributions, the Israel Lobby dominates the process of choosing and electing representatives in Congress. How much does it cost to buy the political obedience of most federal politicians? How much does it cost to replicate this feat in the state legislatures and even municipal governments?
Through the ownership and/or control of major media outlets, the Israel Lobby exerts major influence in determining the main outlines of much public discourse when it comes to US-Israeli relations and many related subjects. How could one calculate the amount of money it took to achieve this feat? How much of this money is directed into payments for compliance, in other words, bribery? In the post-Epstein era what is the role of bribery’s criminal cousin, namely backmail?
The Israel Lobby is deeply engaged with other lobbies in transforming the Internet from an open forum of public interaction and debate into a centrally controlled propaganda instrument. Prominent among the Internet’s most aggressive censors and thought police are Google, You Tube, Facebook, Twitter and the Anti-Defamation League of B’nai B’rith.
Through all kinds of interventions the Israel Lobby asserts significant forms of control over a broad array of institutions and operations including those of the judiciary, the universities, book publishing, magazine publishing, municipal governments, trade unions and cultural groups. The biggest and most influential cultural group of all is the Hollywood film industry. Not surprisingly there is little in its cinematic output that provides critical perspectives on Zionism and its emanations.
The injection of huge amounts of money are essential to the exercise of so much concerted influence over such a broad sweep of political, intellectual and cultural organizations. Where do the large quantities of money supporting the activities the Israel project come from? Why is it that so many of agencies of the Israel Lobby have the status of charitable organizations with the capacity to extend tax write-offs to donors? What is the relationship of the Israel Lobby to Wall Street and the Federal Reserve Bank of New York?
Even the act of asking such questions will be seen by some as heretical. There is, however, nothing wrong with looking into issues that have so much impact on the quality of our political discourse… so much impact on our capacity to live together with the civility and security we have been losing so quickly with the imposition of the economically crippling lockdowns.
It is no less legitimate to ask questions about the ethnic identity of those who benefit most from the US economy than it is to ask questions about what groups suffer the most from the deprivations of poverty. Wouldn’t it make sense to try to moderate the disparities beginning with processes of research and discussion?
In a book of the same name, former ADL Executive Director, Abe Foxman, has opened the discussion of Jews and Money. Foxman effectively counters the view that all Jews are rich. Foxman, of course, is correct in this assertion. All Jews are not rich. Some are outright poor. A fairly large number of Jews, however, are somewhat rich and a small minority of Jews are disproportionately invested with wealth and power. Jews are especially well represented in the billionaires club both within the United States and internationally.
Some of the wealthiest Jews are part of the Wall Street establishment including the Federal Reserve Bank of New York. Perhaps the time has come to begin retiring this, “the most gigantic trust on earth.” Perhaps it is time to retire some of the debt created over more than a century of putting private bankers in charge of dictating interest rates as well as creating debt-laden dollars. Perhaps the time has come to lessen the debt burden that is narrowing the life chances of so many people who have been funding the wars for Israel mounted in the wake of the 9/11 deception.
The severity of the crisis before us compel all thoughtful people of conscience to look beyond the redeployment of old institutions and old remedies for old problems that are different from the challenges facing us now. One of the most obvious ways to avert further calamity is to move away altogether from the empowerment of private bankers to massively expand national debts with compound interest charged to tax payers.
The alternative to this approach is to change the present means of creating new money. The creation of many banking systems similar to that of the Bank of Canada should be considered in the quest for the main ingredients of a global reset. The Bank of Canada brought about an almost-debt-free run of prodigious nation building before Pierre Trudeau bent the policies of his government to meet the impositions of the Bank of International Settlements.
That’s 30 million laid-off workers who qualified for unemployment benefits, which is not everyone who was laid off, since many people who get work for a wage don’t qualify for unemployment compensation.
For example, between mid-March and the end of the first week of May, according to US News, 33 million laid off workers applied for unemployment compensation benefits. At least three million of them were denied benefits for one reason or another. That of course doesn’t count the people who lost work but hadn’t worked enough weeks to qualify and who never even bothered to file. It also doesn’t count many “independent contractors” who were not being defined as employees by the companies paying them, which would include many people working as gardeners, roofers, carpenters, in nail salons and as cab drivers. But just for the hell of it, let’s just go with that 33 million number, and say that is the number of unemployed in the US.
Now recall that the US has a population of almost 330 million.
How many of those people are working age? We can define working age, for the sake of argument, as 18 to, say, 67. (I’m assuming that latter number, situated midway between 65, when people qualify for Medicare and often decided to retire, and 70, the age when a person can collect the maximum amount of Social Security benefits per month, will balance out.) Using Census Bureau data (which I tinkered with to get the number of 18 and 19 year-olds, as well as of 66-69 year olds), I come our with about 219 million. Now a lot of those people don’t get classified by the Bureau of Labor Statistics as part of the labor force either because they are full-time students, or have never worked (stay-at-home parents, for example, with no access to or funding for daycare, or those disabled and unable to work, or already retired), but again for the sake of argument, let’s just call them all workers.
Well, what percent of 219 million is 33 million? The answer is 15%. I’d say that means that the US has clearly got an unemployment rate of at least 15%. So what is the BLS saying the unemployment rate is? Well, in their unemployment report for July, the BLS was listing the jobless rate as being 10.2%. That figure is 50% lower than the percent of workers who are receiving unemployment benefits!
How can that be? It can’t. It’s just wrong.
Part of the problem is that the BLS, which maybe should be just called the BS, doesn’t consider someone to be unemployed and part of the labor force if they have not looked for work in more than a month. But of course, there are good reasons why someone who is able-bodied and who needs a job may not look for one. In an economy like this one, there simply may not be any jobs for certain people with certain skills. In certain parts of the country, if you’re not willing to move, you just have to wait for the economy to improve before you’ll be able to find a job. Take waiters. With restaurants closed or only able to operate at 25% or 50% capacity, there just aren’t as may jobs for waiters or other restaurant staff. That means people with those job backgrounds need to compete with people in other service sector jobs that are also probably not hiring. Under such circumstances looking for work is an exercise in futility.
At any rate, clearly the unemployment rate is at least to 15% just based on the number of people who had jobs and are now eligible for unemployment benefits (at least until those short-term programs run out). But it is actually worse than that because a more honest figure would include those who would like a job if they could find one, or who have a part-time job but used to have, and would like to have a full-time one. The BLS actually has that number. It’s called the U-6 unemployment figure. In July it was 18.3% But I suspect it must be higher, because all those 33 million people getting unemployment benefits are required by their state labor departments to be actively looking for a job, so they wouldn’t be in that category of worker included in the U-6 figure. That means unemployment or under-employment must really be well above 20% of the working population. I would guess that it’s probably close or equal to the 25% unemployment that the US reached during the depth of the Great Depression.
In any event, it’s clear that the government is not doing a good job of describing the current economic crisis facing the country and its people in this pandemic-induced depression. And the news media, which for the most point print the monthly and weekly BLS statistics on jobs and layoffs and total unemployment, after putting a positive spin on tiny optics in hiring or drops in the unemployment rate. How under those circumstances can the public and elected officials make appropriate decisions on economic policy, on who to vote for in November and on their own lives (whether to buy a house or a car, or to go to college or have a child, etc., for example).
When the country was in this type of dire situation situation back in 1936, the government, headed by Franklin D. Roosevelt, was creating public jobs to build roads and bridges, develop national parks, build electric networks and dams, was even funding artists, musicians, writers, orchestras, the production of plays, basically anything to get people back to work and earning a paycheck.
Now the government in Washington cannot even see its way clear to pass a bill to hand everyone adult a second $1200 check to help pay the rent or put food on the table.
One reason is that the depth of this crisis is being hidden from us.
The numbers prove it, but you have to do a little work to find them.
It’s been a weird time, the last six months, and so it continues; perhaps it always was. It’s certainly been an unjust violent mess in varying degrees of severity, for as long as most can remember. With selfishness, division and pleasure firmly in the driving seat, and the planet beautiful, slowly choking to death under the weight of human greed and stupidity.
After Covid-19 erupted, widespread lockdowns like a blunderbuss were enforced in many countries, and for a brief interlude hush descended on towns and cities across the world. Whole populations from Europe to New Zealand and most points in between were forced to desist from ‘going out’ and socializing, made to curtail their habitual shopping urges and change their work patterns. A strange and uncertain time, aggravating pre-existing anxieties, triggering depression, threatening economic meltdown.
A rare space opened, is still available, creating the opportunity to reflect on how life was and is being lived, individually and collectively; an opportunity to redefine what is important, and for those so inclined, to ponder life after the virus. A feeling of post-pandemic hope circulated among the hopeful. Could, will, ‘things’ change for the good at last? Would corporate governments emerge with a new attitude towards public services, ‘key workers’ – who had suddenly become heroes – the environment and national health care systems (where they exist, and where they don’t with a recognition that they should), refugees and migrant workers.
Will the many acts of community kindness foster lasting social responsibility, can the pause in consumerism, manufacturing, and travel, ignite a major shift in political and social attitudes, leading to a change in policies and collective behavior rooted in environmental and social responsibility? Many hope for such a long overdue bonanza, but as countries tentatively begin to emerge from the shadow of Covid the political rhetoric and corporate talk is depressingly predictable.
Saddled with huge national debt, the prospect of an economic ‘slump’, or ‘slowdown’ and mass unemployment, anxious politicians lacking vision, and business leaders (understandably) concerned with survival and profit, repeatedly, and desperately talk about getting back to ‘normal’; re-starting the economy – the very economy that has polluted the air, the oceans and the land – and speedy recoveries. It is predictable lunacy; no, no, no, not business as chuffing usual, many cry. This is a chance to think outside the existing foul paradigm, to creatively re-imagine how life could be. If we are to face the most pressing issues of the day, there must be real change.
The term ‘new normal’ is routinely bandied around by politicians, business leaders and commentators these days; it’s often used to describe the changes to working methods – Zoom meetings for example, education bubbles in schools, one-way systems and hand sanitation in shops, face coverings on public transport. Cautionary health care measures, but nothing of substance; nothing that will save the planet, mitigate the ecological vandalism being perpetrated by humanity; create social justice, end violent conflict, racism and starvation; banish malnutrition, reform education, offer justice and support to migrants, and house the homeless in every land – for example.
We do not need a ‘new normal’, referring as it does to the old, decrepit, inadequate, poisoning ‘normal’ that has cast a cloak of misery and insecurity everywhere it is found, and it’s found everywhere. 99.9% of people around the world, and the natural environment require revolutionary change. Fundamental socio-economic change, true and lasting shifts in attitudes and behavior, not simply Covid-19 enforced adjustments encased in the existing structures and values – manipulations of an inadequate socio-economic model, which needs dismantling. As author Phillip Pullman put it: “It’s all got to change. If we come out of this crisis with all the rickety, flyblown, worm-eaten old structures still intact, our descendants will not forgive us. Nor should they. We must burn out the old corruption and establish a better way of living together.” And if you take a walk through a shopping area, an industrial site or office island, it’s clear; the old is dying before our very eyes, not due to the pandemic, but because it is devoid of vitality, totally and utterly. It’s finished, let it go, and let’s turn our attention to re-imagining society and the systems under which we all live; allow the transition into the new to creatively and harmoniously take place.
Save Our Planet (S.O.P.)
For months Covid-19 has stolen the headlines and dominated mainstream media programs, but within a burgeoning list of interconnected crises, of which the current pandemic is one, it is the complex environmental emergency that screams out as the single greatest issue facing humanity. And if humanity is to rise to this greatest of challenges, wholesale change is needed. Under lockdown the environment appeared to be given a respite, the air somewhat cleaner, rivers lighter, but, perhaps surprisingly, greenhouse gas emissions have been barely affected. The International Renewable Energy Agency (IRENA) expects this year’s annual emissions to be reduced by just 6-8%. This, they make clear, will have no measurable impact on carbon concentrations, or climate warming. In fact, 2020 is on track to be hottest year on record, on the back of subsequent hot years. According to the UK Met Office, a 10% drop is needed “to have a noticeable effect on the rising CO2 concentrations, but even then concentrations would still be rising.”
The principle cause of the environmental catastrophe is consumerism, insatiable ignorant human consumption of stuff, most of it unnecessary, and, crucially, animal-based food produce, and if we are to Save Our Planet (S.O.P.) and provide a viable world in which our children and grandchildren can live and grow, radical changes in our modes of living are needed, alternative values encouraged. Changes that move humanity in a new direction completely, that negate totally the urge, tempting or inevitable as it may appear to many to be, to resurrect the terminally sick economy and pursue the Growth Genie. Rooted in endless consumption, greed and competition such obsessive behavior has, in addition to strengthening nationalism and division, pushed the planet into critical care and, if we continue to be hypnotized by the pursuit of transient pleasures, will lead, if we are not already there, to irreparable climatic disorder and chronic ecological disease – and soon.
Returning to ‘normal’ means re-igniting the consumer-based economy, encouraging consumerism and affirming negative, habitual patterns of behavior. That’s what the politicians and the corporate voices are concerned about, and, while they may include the words ‘green’ or ‘alternative’, ‘renewable’, or ‘eco’, in their rousing duplicitous rhetoric, their principle goal is not salvaging the environment, changing behavior and encouraging simplicity of living; it is generating profit, perpetuating ‘growth’. And the way that’s achieved is by populations consuming, irresponsibly and in excess. An economic system based and reliant upon limitless consumption, in all its facets, including animal agriculture, is completely incompatible with the health of the planet, and the well-being of people.
Instead of excess, simplicity and sufficiency need to be the goals; responsible consumerism, in which goods and services are bought based on need, and choices/decisions are determined by the impact on the natural world. This requires personal effort and worldwide education. National public education programs, run by governments in collaboration with environmental groups, are needed to make people aware of the impact of their behavior on the environment, including animal agriculture; cutting out all animal food produce is the single most significant step individuals can take to help reduce their impact on the environment.
Changes in behavior are essential, but governments, long-term political policies and corporations have the biggest impact; while the rhetoric from some in office may be resonant, it is difficult to see any politicians within the current crop who have the breadth of vision and the will to enact the radical measures needed if the environmental emergency is to be overcome. All are married to the existing structures and appear to believe in the pervasive socio-economic ideology. Intense public pressure then, like the actions undertaken by Extinction Rebellion, Greenpeace, the Schools Strike for Climate and others, is crucial and must be applied, consistently and forcefully if, and it is a loud and deeply troubling if, the needed actions to Save Our Planet and heal our societies – for the two are inextricably linked – are to take place within the time frame required.
No ruling class could survive if it wasn’t attentive to its own interest consciously trying to anticipate control/ initiate events at home & abroad both overtly & secretly.
The dirty truth is that many people find fascism to be not particularly horrible.
— Michael Parenti, 1 POLITICS AND ISSUES, Fascism In a Pinstriped Suit, p. 32 – Dirty truths (1996), first edition
As a trauma-informed social worker (no, it’s not some buzzword or new age trend) who has worked in prisons, in closed homeless facilities, in memory care day programs, for teenager foster youth and adults living with developmental disabilities, as well as worked with veterans who are homeless (in a clean and sober facility) and with the basic human beings who find him or herself homeless in Portland on the streets in a tent, I understand the deep well of historical and familial baggage people have.
I understand we can either “make it” through childhood traumas with a modicum of sobriety when it comes to self-esteem, self-care, self-enlightenment or we just are in a constant stage or healing and rehealing (that’s true for most people I know, and myself, as well).
As I repeated many times to my daughter when she was growing up in El Paso and then Spokane (and she visited me in Seattle and Portland where I worked with the so-called down and out), when you see that toothless smile, the grime, the shaky hands holding up that sign, “Anything helps . . . Please Help a Vietnam Veteran . . . My Family Needs Money to Feed Themselves,” remember that that adult once was loved, coddled, and even cared for (even for a few moments in the hospital). That adult did not wake up one day in elementary school, when the teachers asked, “what do you want to be or do when you grow up?” and then responded: “I want to be addicted to pot and alcohol by age 12, meth by 17, heroin by 23 and then homeless at 25. I want to be put into the criminal justice system, have a long rap sheet, have my veins collapsed by age 36, my heart out of whack by age 40, constant headaches the rest of my life, shakes and delusions, and be carted off every month or two by an ambulance passed out with urine-soaked and shit-smeared pants.”
I recommended to her to be smart, to protect herself, to know her surroundings, but to treat these people – even the ones in the street yelling at voices and demons with their pants half down or completely naked from the waist down – as people who once, maybe for a short span of time, were honored/loved as children, as babies, as gifts of the world, with people galvanizing so much hope and future and potential into the thin vulnerable surface of a baby.
Story after story, case after case, and you end up age 63, still writing, still teaching, still working in social services, and now, on the Oregon Coast, in an amazing ecosystem, but also held in a kind of captivity during this time of police killings, BLM protests, lockdowns, spiraling and spiraling numbers of people on the edge, with each new day producing another 500 people ready to be entered onto that statistical category – “One Pay Check Away from Eviction or Foreclosure” and “One Mental Health Crisis from Suicide.”
If it were just that simple. Eviction, or foreclosure, well, not good on the old credit record, but if the person has safety nets, people they call friends and family and compatriots, then a soft-landing might be in store with an eviction or loss of a job or foreclosure or mental health crisis.
Unfortunately, we have a tendency to not want to admit failure after failure, our precarity after precarity and certainly we do not want to see that life in the USA is one thin ice episode after another. Fine one day, the next month bankrupt because of a cancer or chronic disease. We want to have this thin gossamer of hope that tells us (deludes us) that there is a chance things will not only turn around, but that we will have learned from the hardships and will have benefitted from the all and that we will be better people after all those hardships and that we will not only survive but thrive after all those bad bad things happening to us.
Somehow people believe there are agencies and people and armies of volunteers in the ready to help. That is the big lie of dog-eat-dog capitalism. Odd.
George Lakoff used to harp on narrative framing, discussing why, say, a house painter or truck driver or warehouse forklift driver would even have any mental or logical reason to identify with someone like, say, George W. Bush. Yale, silver spoon, East Coast background, millions upon millions in the family coffer way before 1960, and now, in that era, just a regular kind of guy.
Nope – I knew many military men and women who did not suck Southern Comfort, sniff coke, womanize/manize, do no-shows (AWOL) in their Guard unit, and alas, attack every American left of his right wing mentality.
Really, I am not pulling this stuff out of thin air. I was a military dependent – Azores, Maryland, Albuquerque, Paris, France, Munich, Germany, Scotland, and then Arizona – who had a great life traveling throughout Europe and the UK and USA before I was 14. I knew hundreds upon hundreds of military men and women. War veterans (my old man, shot in Korea, shot in Vietnam, 31 years total Army and Air Force combined). I worked with a few World War I vets as a journalist in Arizona. Plenty of WWII vets, and of course, Vietnam vets.
I taught college-level writing and literature classes to military on an Air Force fire-fighting line, on a military post, and in an NCO Academy. Arizona, New Mexico, Texas, Washington.
I ended up years later in Vietnam working as a journalist/biodiversity team member. I have met and been deeply connected with ex-military in Mexico, Costa Rica, Guatemala, and Honduras.
Radical teacher, writer, activists, social services guy, and here I was, in 2018, working with down and out veterans who not only face homelessness, but PTSD, disabilities, trauma after trauma. Hands down, most of the thousands of military I worked with, then, supported my journalism, my writing, my teacher, albeit many were taken aback at my history with the military and my own familial history – grandfather who flew tri-planes for the German Navy in WWI, German uncles and relatives who were on the Russian front, Scottish and English uncles and relatives who were in submarines, on ships and as grunts in WWII.
There was a nanosecond or two where I considered attending West Point, and having a few ins there, I might have had a chance to get accepted. I understand the military, and that it is a blunt instrument, and that General Smedley Butler, who not only wrote War is a Racket, but broke up a business-influenced military coup attempt against FDR.
I’ve reported on cops as reporter on the so-called police beat for several daily newspapers. I have worked with Central American refugees, with prisoners and ex-prisoners, with seniors in a continuing education program, all with some sort of trauma and multiple traumas, including survivors of death squads in Guatemala, horrific injustices and rapes inside the wire, and a few Nazi death camp survivors.
Hands down, the idea for me is expression, self expression, working through (mostly not to the end of it) multiple adverse childhood traumas, and then those trauma inflicted through into adulthood. Perfectly fine 17 year old high school heavyweight wrestling champ, goes into the Marines, and comes back to Spokane, my student, completely obliterated emotionally as a man.
Battle of Fallujah, 18 years old, and three major areas of trauma – orders to flash lights twice, honk once, and if the person (civilian) is in the road, just mow over him or her. For my student, Jacob, that was a woman who looked like his grandmother, under the chassis of the Stryker vehicle, and as a private, he was ordered to “go find her fucking head and put it next to the body after we drag her worthless ass out from under the vehicle.” Imagine, taking a head, one that was just alive minutes before, to this headless body. A head that was more ways than one resembling his grandmother on his mom’s side, a Mexican granny.
Next, the battle field, Fallujah, and house to house, step-by-step combat, and again, Jacob and his cohorts (thousands and thousands over the years) told to shoot anyone left standing, sitting squatting. “If they fucking lift their hands and wave a white flag, better for you to get a clear shot . . . no worries about an AK-47 or hidden grenade.”
The last one of many traumas for Jacob happened on “Thanksgiving,” and he was on a mission to retrieve three dead buddies. They brought the cadavers back to base camp, and Jacob wanted to just crash in his cot – read, listen to music, sleep. “No way, soldier. This is Thanksgiving, and I want your ass in the mess pronto. We got President Bush coming in a live feed, and you will sit down and eat all this food shipped in and cooked by your fellow grunts.”
Oh, that, and the fact Jacob was amped up on amphetamines fed to the soldiers for long-duration battles, and the steroids they administered (ordered to take) as part of the battlefield triage – enough anabolic steroids in the body will allow for healing, no more bruised muscles, no more fagging out because of torn ligaments, bruised bones, bone spurs (how ironic, with Orange Menace Cadet Bone Spurs laughing all the way to his deferments).
And other some such stuff, like forced vaccinations and some odd duties in Afghanistan and UAE.
You can take the boy/young man away from the Middle East, but you can’t take the Battle of Fallujah out of the man. That sort of thing. Stuck in a community college class, five years later, and Jacob was up shit creek – how to relate to students, to faculty, to the assignments. I was one of his healers. I even got him in on a conference in Seattle – a first, really – as an undergraduate student talking about trauma and social justice as it dealt with his military trauma and indoctrination. He met David Zirin, the head speaker of the event.
In reality, after working so long and hard at all these avocations and these gig jobs and part-time appointments and non-permanent full-time assignments – while still writing, still reporting, still organizing – I have a few lifetimes under my belt when it comes to trauma, people, war, injustice and the will to live.
In the end, though, the concept of expression and debate and 1st amendment principles goes North/South/East/West. No matter how much the idea of free speech is aspirational it certainly is not a reality in a society that forces people to be conscripted in K12, forces people to pee in a cup before employment (guilty/suspect first until proven innocent) and to undergo credit-real estate-background checks, to be hirable only after references are contacted and work history verifiable. Think about how much free speech we have when we want to tell a cop he or she is part of a killer force. Try it, to their face. Try telling a DA or judge they are engaging in criminal injustice and arbitrary punishment. Try telling the supervisor that there is something wrong-dangerous-unethical about something in the company-corporation-factory. Try telling a governor that “to mask or not to mask” is not the way to tackle the pandemic, the SARS-CoV2, etc. and tens of millions out of work, near destitute. Try going to work NOT wearing a mask. Try giving the thumbs down (or middle finger up) to a bunch of neo-Nazi’s or Proud Boys while the cops are protecting them. Free speech in universities? Come on, there are millions of incidents of faculty, students and others who were shunted away from any free speech or so-called academic freedom. Try telling the so-called progressive union you are working for the Jill Stein campaign when the union(s) endorsed Barack Obama in May before the election.
Having my free speech taken away or questioned is a sort of trauma I relive over and over and over.
We understand the censoring of free speech on social media. We understand the algorithms that wipe clean Google searches for many many topics. We know how we are just data fields for the masters of the universe, and that if we dare kick and scream or try and buck the system, we are then cobbled or kettled away from the so-called mainstream. Our money and land and minds will be seized. Free speech my ass.
Try not standing for the National Anthem and Pledge of Allegiance (I have not stood since age 13, with all sorts of hell to pay). I’ve had sodas thrown at me and hotdogs tossed at my back in college stadiums. I have been yelled at in high school events. I was screamed at as a wrestler when I stayed on the mat. I was pulled from wrestling matches when I stayed on the mat during the bloody National Anthem.
No hat off during a star-spangled banner rendition. That gets people pissed off.
As a follower of many revolutionaries and thinkers outside the box, I can certainly get tied up in some contradictory thinking, and, alas, it is highly probable that we all need to embrace oppositional ideas (not just black v. white, but many views and slants and POV’s) to understand our own narrative contexts and how the world really works. Of course, the concept of thinking outside the box is almost impossible in a supra-colonized society like the USA, an oligarchy, and a war and imperial nation tied to the notion of Capital Trumping All. Free speech may have a lot of grounding in what are community standards of what is acceptable speech and what the culture may or may not tolerate (my belief is close to the ACLU’s in terms of protect hate speech – for), but in this predatory and parasitic capitalism, the boss and the bank and the brigadier general the blue line trump all.
Attempting to define one’s perspective outside the lines of corporate-financial-surveillence-taxation-penalizing-fining-tolling-penury constraints is more dangerous than yelling, All Black Lives Matter or ACAB – All Cops Are Bad/Bums/Bastards/Brutes/ETC.
I have been told as a college adjunct to not force (what is that?) students to read the Fight Club and to see a few clips from the movie as a discussion point about male identity and Dystopian thinking. The idea is to give students in a state college alternatives if they have a PG13 rule at home and if they deem anything offensive, anti-American, profane, violent. Or anti-Christian.
I have been told to not bring up so many political issues in my writing classes, that too many students are writing about climate change, GMOs, collapse of civilization, social justice/injustice, USA’s role in genocide, etc., etc. “Why don’t you just keep the reading list to things like The Shipping News or The House on Mango Street, if you want to deal with multiculturalism?”
Yep, free speech gives many many Americans headaches. Fine. But, to have to deal with a neighbor’s adult son, age 41 and, and a friend of his in his 30s, on a Saturday night while I am watching a film at 10:40 pm stripes away the very definition of not just what free speech denotates, but what trespassing and home invasion does to shunt free speech, or expression (as in putting up a sign on our property).
Here I am, in a small house, with a glass screen to shunt the Pacific winds, leading up to a two-step stoop to the front door. On the window, about six feet up, the above sign — around 12 by 18 inches. Notice it is an American flag as the background. Notice it is something many of you have seen, I am sure, posted in your own neighborhood. Not my pro-Antifa sign, my upside down American flag sign, or other such radical things. Simple and easy for a semi-liberal to understand.
So, two strapping fellows yank it off while the movie sound is not that high. Thinking there is some other noise-producing thing going on outside, like a raccoon in the garden or a cat on the car roof, I open the door and the sign is ripped down and the two lurking men are dashing away, less than 20 yards across the street, with the sign. I yell at them, sort of flabbergasted that they didn’t just drop the sign when I called them “you pieces of shit … what did you do?” Then, the one gentleman yells – “Call the fucking cops then . . . . hahaha.”
We are talking almost 11 pm, and my spouse was sleeping, and, well, I went outside, with the lights on, and had a flashlight, but the two bums slinked in this guy’s retired parents’ big ass two story home with all the lights off. I was willing to talk, really, as in mediate – “You two fucked up, so now return the sign.”
You see, in America, Free Speech is trumped by the Second Amendment. What do you do knocking on a door at 11 pm when the house has no lights on? In a real world, well, you knock on the door. In America, you know that a 9mm or shotgun could very easily greet you at the door, or just go through the door.
Trauma. Now, two stupid men with nothing else to do but to take this property down and steal it can’t fathom the world as it really is. Sure, they were probably drunk, inebriated. That’s what a lot of white guys, young and old, do down on the coast. Saturday night. A big moon. No wind. Drunk.
But again, the trauma that my wife had at age 21 really plays into this scenario. I would have had no problem on my own knocking on the door. I know I would have pointed my car’s headlights over at the doorway so there would be proof they could see me. I would have asked for the sign back. I would have stepped back off their stoop because in America, a man’s stoop is his castle.
You see, coming onto our fenced property (small yard) and then physically ripping down a sign is both invasion and theft. I heard the ripping sound twice, 20 minutes apart, and alas, so, it took them two attempts to pull OUR sign down, and that is also a form of stalking.
What about the trauma of people shits like this are triggering? What about the lack of values stealing a sign? I have told many a person that the Reagan hat or Bush hat or Clinton hat or Trump hat were insults to my intelligence. However, I said it calmly, and I knew they had a right to the stupid hats on their heads. Same with yard signs –Blue Lives Matter (bizarre and racist). If the gal or guy is out watering their weeds, I have told them that the sign is illogical and out of place. And then, if there is a discussion, great. If there is a “fuck you . . . fuck off” (which is usually the case), then I laugh and walk off, keeping an eye out for my back because the United Snakes of America has a history of back-shooting Native Americans, Blacks, Asians, Latinx, poor white people, women, Middle Eastern-looking humans.
A country imbued in “might makes right” will indeed incubate all manner of idiots, whether that be a college provost or president, or some Joe the Plumber making more than the college president putting in toilets and unclogging sewer lines.
So, the Lincoln County sheriff deputy is called Sunday morning. He takes down information. He makes a notation of the trauma this incident inflicted on my wife. We talk more before he goes over to the offenders’ house. It turns out the deputy had 14 years in US Army, and the last 5 years he was in the Seattle area working on a special task force and investigative unit on sexual crimes (rape) in the military.
He understands fear, trauma, and what some people might sense as an invasion of their home, their sense of safety and future engagement with these nutty neighbors. That’s how my spouse feels. And the deputy gets the “man thing,” that I am still not afraid of authority, or mock authority, or big man rules the roost authority. He knows I would be out there talking to them now, but the trauma on my spouse trumps all.
This family is an across-the-street neighbor.
So, now, ugly No Trespassing signs I’ve put up on the chain-link fence. I had to purchase and install an extra light for the front porch. That sort of crap. The deputy suggested a no stalking order requested by my spouse from a judge. In the end, the conversation with the dipshits across the way was not cooperative, the deputy said. The tall guy, one of the perps, said, “I have nothing to say.” The father hemmed and hawed, but they never admitted to it. The deputy said he told them in no uncertain terms there was no reason for any of them to be in our yard, let alone messing with our property, the sign.
While the deputy was cooperative with us and empathetic (I told him about my military experiences, my dad’s and such), the bottom line was that I did not have photographic or closed-circuit evidence, and alas, that’s the new normal. “I can’t make him cooperate, but I made it clear that there should be no trespassing onto your property.”
This is America – small town or big town. Some of the other neighbors talked to me about “the sheriff’s vehicle in your driveway . . . what’s up.” And, here in the USA, sometimes the information spigot is forceful – lots of information about the California son who did the rip-off with his male friend. “He has been there for two months and he just stays inside and drinks all day.” You know, trauma after trauma/after addiction after addiction. Another neighbor said the other son, this guy’s 39-year-old brother, well, they both look alike, and that guy has “been on and off the wagon for a year.”
Then, itchy fingers, and my spouse finds the old parents on line, on Facebook, and then one of the son’s as well, with amazingly hateful posts – “With all these logging trucks, they should go to Portland and just run over those scumbag protestors.” And then tons of likes and hearts on that post.
I am grounded, and always have been. Capitalism under the USA, NATO, most of Europe and Canada, well, these societies are war societies and war organizations with continuing criminal enterprises called banks. No matter how hard a small minority of folk tries to shed the war complex and the MIC, no matter how hard they attempt to be anti-war, anti-racist, anti-corporatist, the majority in this country (Not just MAGA) are flag wavers, believers in exceptionalism for the white race/culture and in this country, believers in the adage “the man/woman with the most things/money/power when they die are the best people on earth (or wins)”.
Know your enemy and know your debater. Know how people frame things, and know motivations, and understand/study the epigenetics of their lives, what agnotology is, and why someone like Gore Vidal might write a book titled, The United States of Amnesia.
I go to Christian Parenti for some framing and dicing of the system that is the world’s most horrific and terroristic —
Here, some riffs on free speech (does it really exist in the USA?) by the ACLU!
Finally, in 1969, in Brandenberg v. Ohio, the Supreme Court struck down the conviction of a Ku Klux Klan member, and established a new standard: Speech can be suppressed only if it is intended, and likely to produce, “imminent lawless action.” Otherwise, even speech that advocates violence is protected. The Brandenberg standard prevails today.
First Amendment protection is not limited to “pure speech” — books, newspapers, leaflets, and rallies. It also protects “symbolic speech” — nonverbal expression whose purpose is to communicate ideas. In its 1969 decision in Tinker v. Des Moines, the Court recognized the right of public school students to wear black armbands in protest of the Vietnam War. In 1989 (Texas v. Johnson) and again in 1990 (U.S. v. Eichman), the Court struck down government bans on “flag desecration.” Other examples of protected symbolic speech include works of art, T-shirt slogans, political buttons, music lyrics and theatrical performances.
In 1971, the publication of the “Pentagon Papers” by the New York Times brought the conflicting claims of free speech and national security to a head. The Pentagon Papers, a voluminous secret history and analysis of the country’s involvement in Vietnam, was leaked to the press. When the Times ignored the government’s demand that it cease publication, the stage was set for a Supreme Court decision. In the landmark U.S. v. New York Times case, the Court ruled that the government could not, through “prior restraint,” block publication of any material unless it could prove that it would “surely” result in “direct, immediate, and irreparable” harm to the nation. This the government failed to prove, and the public was given access to vital information about an issue of enormous importance.
It took nearly 200 years to establish firm constitutional limits on the government’s power to punish “seditious” and “subversive” speech. Many people suffered along the way, such as labor leader Eugene V. Debs, who was sentenced to 10 years in prison under the Espionage Act just for telling a rally of peaceful workers to realize they were “fit for something better than slavery and cannon fodder.” Or Sidney Street, jailed in 1969 for burning an American flag on a Harlem street corner to protest the shooting of civil rights figure James Meredith.
On August 2, lockdown measures were implemented in Melbourne, Australia, that were so draconian that Australian news commentator Alan Jones said on Sky News: “People are entitled to think there is an ‘agenda to destroy western society.’”
The gist of an August 13th article on the Melbourne lockdown is captured in the title: “Australian Police Go FULL NAZI, Smashing in Windows of Civilian Cars Just Because Passengers Wouldn’t Give Details About Where They Were Going.”
Another article with an arresting title was by Guy Burchell in the August 7th Australian National Review: “Melbourne Cops May Now Enter Homes Without a Warrant, After 11 People Die of COVID — Australia, This Is Madness, Not Democracy.” Burchell wrote that only 147 people had lost their lives to coronavirus in Victoria (the Australian state of which Melbourne is the capital), a very low death rate compared to other countries. The ramped up lockdown measures were triggered by an uptick in cases due to ramped up testing and 11 additional deaths, all of them in nursing homes (where lockdown measures would actually have little effect). The new rules include a six week curfew from 8 PM to 5 AM, with residents allowed to leave home outside those curfew hours only to shop for food and essential items (one household member only), and for caregiving, work and exercise (limited to one hour).
“But the piece de resistance,” writes Burchell, “has to be that now police officers can enter homes with neither a warrant nor permission. This is an astonishing violation of civil liberties…. Deaths of this kind are not normally cause for government action, let alone the effective house arrest of an entire city.” He quoted Victoria Premier Daniel Andrews, who told Victorians, “there is literally no reason for you to leave your home and if you were to leave your home and not be found there, you will have a very difficult time convincing Victoria police that you have a lawful reason.” Burchell commented:
[U]nder this new regime you can’t even remain in your house unmolested by the cops, they can just pop ‘round anytime to make sure you haven’t had Bruce and Sheila from next door round for a couple of drinks. All over a disease that is simply not that fatal….
Last year more than 310,000 Australians were hospitalised with flu and over 900 died. By all metrics that makes flu a worse threat than COVID-19 but police weren’t granted Stasi-like powers during the flu season. Millions of people weren’t confined to their homes and threatened with AUS$5,000 fines for not having a good reason for being out of their homes.
At an August 19th press conference, Australia’s second most senior medical officer said the government would be discussing measures such as banning restaurants, international travel, public transport, and withholding government programs through “No Jab No Pay” in order to coerce vaccine resisters.
An August 13 article on LifeSiteNews quoted Father Glen Tattersall, a Catholic parish priest in Melbourne, who said the draconian provisions “simply cannot be justified on a scientific basis”:
We have a curfew from 8 pm to 5 am, rigorously enforced including by the use of police helicopters and search lights. Is the virus a vampire that just comes out at night? Or the wearing of masks: they must be worn everywhere outside, even in a park where you are nowhere near any other person. Why? Does the virus leap hundreds of metres through the air? This is all about inducing mass fear, and humiliating the populace by demanding external compliance.
Why the strict curfew? Curfews have been implemented recently in the US to deter violence during protests, but no violence of that sort was reported in Melbourne. What was reported, at least on social media, were planes landing in the night from the Chinese province of Guandong carrying equipment related to 5G and the Chinese biometric social credit system, which was reportedly being installed under a blanket of secrecy.
Angelo Codevilla, professor emeritus at Boston University, concluded in an August 13th article, “We are living through a coup d’état based on the oldest of ploys: declaring emergencies, suspending law and rights, and issuing arbitrary rules of behavior to excuse taking ‘full powers’.”
Questioning the Narrative
Melbourne has gone to extremes with its lockdown measures, but it could portend things to come globally. Lockdowns were originally sold to the public as being necessary just for a couple of weeks to “flatten the curve,” to prevent hospital overcrowding from COVID-19 cases. It has now been over five months, with self-appointed vaccine czar Bill Gates intoning that we will not be able to return to “normal” until the entire global population of 7 billion people has been vaccinated. He has since backed off on the numbers, but commentators everywhere are reiterating that lockdowns are the “new normal,” which could last for years.
All this is such a radical curtailment of our civil liberties that we need to look closely at the evidence justifying it; and when we do, that evidence is weak. The isolation policies were triggered by estimates from the Imperial College London of 510,000 UK deaths and 2.2 million US deaths, more than 10 times the actual death rate from COVID-19. A Stanford University antibody study estimated that the fatality rate if infected was only about 0.1 to 0.2 percent; and in an August 4th blog post, Bill Gates himself acknowledged that the death rate was only 0.14 percent, not much higher than for the flu. But restrictive measures have gotten more onerous rather than less as the mortality figures have been revised downward.
Sweden got it largely right, and the British establishment catastrophically wrong. Anders Tegnell, Stockholm’s epidemiologist-king, has pulled off a remarkable triple whammy: far fewer deaths per capita than Britain, a maintenance of basic freedoms and opportunities, including schooling, and, most strikingly, a recession less than half as severe as our own.
Not restraining the populace has allowed Sweden’s curve to taper off naturally through “herd immunity,” with daily deaths down to single digits for the last month. (See chart.)
The Pandemic That Wasn’t?
Also bringing the official narrative into question is the unreliability of the tests on which the lockdowns have been based. In a Wired interview, even Bill Gates acknowledged that most US test results are “garbage.” The Polymerase Chain Reaction (PCR) technology used in the nasal swab test is considered the “gold standard” for COVID-19 detection; yet the PCR test was regarded by its own inventor, Nobel prize winner Kary Mullis, as inappropriate to detect viral infection. In a detailed June 27th analysis titled “COVID-19 PCR Tests Are Scientifically Meaningless,” Torsten Engelbrecht and Konstantin Demeter conclude:
Without doubt eventual excess mortality rates are caused by the therapy and by the lockdown measures, while the “COVID-19” death statistics comprise also patients who died of a variety of diseases, redefined as COVID-19 only because of a “positive” test result whose value could not be more doubtful.
The authors discussed a January 2007 New York Times article titled “Faith in Quick Test Leads to Epidemic That Wasn’t,” describing an apparent whooping cough epidemic in a New Hampshire hospital. The epidemic was verified by preliminary PCR tests given to nearly 1,000 healthcare workers, who were subsequently furloughed. Eight months later, the “epidemic” was found to be a false alarm. Not a single case of whooping cough was confirmed by the “gold standard” test – growing pertussis bacteria in the laboratory. All of the cases found through the PCR test were false positives.
Yet “test, test, test” was the message proclaimed for all countries by WHO Director General Tedros Adhanom at a media briefing on March 16, 2020, five days after WHO officially declared COVID-19; and the test recommended as the gold standard was the PCR. Why, when it had already been demonstrated to be unreliable, creating false positives that gave the appearance of an epidemic when there was none? Or was that the goal – to create the appearance of a pandemic, one so vast that the global economy had to be brought to a standstill until a vaccine could be found? Recall Prof. Codevilla’s conclusion: “We are living through a coup d’état based on the oldest of ploys: declaring emergencies, suspending law and rights, and issuing arbitrary rules of behavior to excuse taking ‘full powers’.”
People desperate to get back to work will not only submit to a largely untested vaccine but will agree to surveillance measures that would have been considered a flagrant violation of their civil rights if those rights had not been overridden by a “national emergency” justifying preemption by the police powers of the state. They will agree to get “immunity passports” in order to travel and participate in group activities, and they will submit to quarantines, curfews, contact tracings, social credit scores and informing on the neighbors. The emergency must be kept going to justify these unprecedented violations of their liberties, in which decision-making is removed from elected representatives and handed to unelected bureaucrats and technocrats.
A national health crisis is also a necessary prerequisite for relief from liability for personal injuries from the drugs and other products deployed in response to the crisis. Under the 2005 Public Readiness and Emergency Preparedness Act (PREPA), in the event of a declared public health emergency, manufacturers are shielded from tort liability for injuries both from the vaccines and from invalid or invasive tests. Compensation for personal injuries is a massive expense for drug companies, and the potential profits from a product free of that downside are a gold mine for pharmaceutical companies and investors. The liabilities will be borne by the taxpayers and the victims.
All this, however, presupposes both an existing public health emergency and no effective treatment to defuse it. That helps explain the otherwise inexplicable war on hydroxychloroquine, a safe drug that has been in use and available over the counter for 65 years and has been shown to be effective in multiple studies when used early in combination with zinc and an antibiotic. A table prepared by the American Association of Physicians and Surgeons (below) found that the US has nearly 30 times as many deaths per capita as countries making early and prophylactic use of hydroxychloroquine.
The latest international testing of hydroxychloroquine treatment of coronavirus shows countries that had early use of the drug had a 79% lower mortality rate than countries that banned the use of the safe malaria drug. Lowering the US mortality rate by 79% could have saved over 100,000 lives. But an effective, inexpensive COVID-19 treatment would mean the end of the alleged pandemic and the vaccine bonanza it purports to justify.
The need to maintain the appearance of a pandemic also explains the inflated reports of cases and deaths. Hospitals have been rewarded with increased fees for reclassifying cases as COVID-19. As deaths declined in the US, the numbers of cases reported by the Centers for Disease Control were also gamed to make it appear that America was in a “second wave” of a pandemic. The reporting criterion was changed on May 18 from people who tested positive for the virus only to people who tested positive for either the virus or its antibodies. The exploding numbers thus include people who have recovered from COVID-19 as well as false positives. The Loughborough and Sheffield researchers found that when controlling for other factors affecting mortality, actual deaths due to COVID-19 are 54% to 63% lower than implied by the standard excess deaths measure.
Ushering in “The Great Reset”
Forcing compliance with global vaccine mandates is one obvious motive for maintaining the appearance of an ongoing pandemic, but what would be the motive for destroying the global economy with forced lockdowns? What is behind the “agenda to destroy Western society” suspected by Australian commentator Alan Jones?
Evidently it is this: destroying the old is necessary to usher in the new. Global economic destruction paves the way for the “Great Reset” now being promoted by the World Economic Forum, the Bill and Melinda Gates Foundation, the International Monetary Fund and other big global players.
Although cast as arising from the pandemic, the “global economic reset” is a concept that was floated as early as 2014 by Christine Lagarde, then head of the IMF, and is said to be a recharacterization of the “New World Order” discussed long before that. It was promoted as a solution to the ongoing economic crisis triggered in 2008.
The World Economic Forum – that elite group of businessmen, politicians and academics that meets in Davos, Switzerland, every January – announced in June that the Great Reset would be the theme of its 2021 Summit. Klaus Schwab, founder of the Forum, admonished:
The world must act jointly and swiftly to revamp all aspects of our societies and economies, from education to social contracts and working conditions. Every country, from the United States to China, must participate, and every industry, from oil and gas to tech, must be transformed.
No country will be allowed to opt out because it would be endangering the rest, just as no person will be allowed to escape the COVID-19 vaccine for the same reason.
Who is behind the Great Reset and what it really entails are major questions that need their own article, but suffice it to say here that to escape the trap of the globalist agenda, we need a mass awakening to what is really going on and collective resistance to it while there is still time. There are hopeful signs that this is happening, including massive protests against economic shutdowns and restrictions, particularly in Europe; a rash of lawsuits challenging the constitutionality of the lockdowns and of police power overreach; and a flood of alternative media exposés despite widespread censorship.
Life as we know it will change. We need to ensure that it changes in ways that serve the people and the productive economy, while preserving our national sovereignty and hard-won personal freedoms.
This month marks the second year since former President of Bolivia, Evo Morales, announced to the world a campaign promoted by a group of Latin American writers and academics to declare August 9 as International Day of US Crimes against Humanity. Appropriately the day is to remember the second nuclear bomb dropped in 1945 on Nagasaki, Japan that came just three days after the first nuclear bomb was dropped on Hiroshima. Imagine how depraved and cold-blooded the then Democratic President Truman could be to find that he had incinerated 150,000 people on one day and turned right around and did it again in Nagasaki instantly killing 65,000 more human beings. US historical accounts love to turn truth on its head by saying how many lives those nuclear bombs saved when Japan was already defeated before the bombs were dropped after 67 Japanese cities had been leveled to the ground by relentless US aerial fire bombings.
The people of Hiroshima and Nagasaki were sacrificed as an exclamation point on a proclamation to the world announcing the arrival of the US as the world’s new pre-eminent super power. It also served as an example that the US would commit any murderous crime of any proportion to maintain that imperial position of dominance and they have demonstrated that to be true time and time again. Even now in decline the US has never apologized for this unnecessary crime because that could convey a sign of weakness and a step back from a policy of nuclear blackmail held over the nations of the world. Obama had the chance to do that in the final year of his presidency when he had nothing to lose in a 2016 visit to Hiroshima. Instead of apologizing to the people of Japan or easing tensions in the world Obama, in eloquent fluffy double talk, said, “Mere words cannot give voice to such suffering. But we have a shared responsibility to look directly into the eye of history and ask what we must do differently to curb such suffering again.”
The responsibility for the majority of suffering in the world was then, and continues to be, on an imperialist policy and its inherent neoliberal engine that violently throttles the ability of countries to develop in a way that would bring health and prosperity for the benefit of their majorities. In the end it is an unsustainable system that only benefits a sliver of privileged society.
The US crimes against humanity did not begin or end with the dropping of the nuclear bombs on Japan. As militant civil rights leader Jamil Abdullah Al-Amin (formerly H. Rap Brown) pointed out years ago, “Violence is as American as cherry pie.” Since its inception the US has been ingrained with a motor force of violent oppression against everyone and every country that stood in the way of its expansion for control of resources and its entitlement to limitless accumulation of vast wealth for a few.
The original thirteen colonies that rebelled against England were not motivated solely by being taxed without representation but more for the restrictions that King George had placed on the unbridled greed of the white settlers to expand and steal the lands of the indigenous nations and communities and to establish a system of slavery which was the main source of capitalist accumulation especially for the southern colonies. At the time of the revolution close to 20% of the population consisted of Black slaves. Slavery actually ran contrary to British Common Law so the only way the emerging class of landowners in the colonies could flourish was to secede from the British Empire. In doing so it established a pivotal component of the original DNA of the United States; structural racism as a means to justify any level of discrimination and oppression with a deeply embedded belief in the inferiority of any race not white and Christian. The cries of Black Lives Matter in the streets of all the major cities and towns of the US today are a resounding echo of resistance that comes from the plantations and the slave ships that came from Africa.
The genocide of indigenous people in the US was its initial crime wave against humanity as it expanded westward destined by God to exercise their Manifest Destiny. The early history of this country is littered with hundreds of massacres of the original caretakers of the land from the Atlantic to the Pacific. And that crime continues to this day with Native Americans suffering from the highest infection rates of Covid-19 in the country as a direct result of government neglect and broken treaties that keep the reservations in grinding poverty including in many areas where there is not even running water.
On July 21 Congress passed a $740 billion military appropriations bill, the biggest ever, and $2 billion more than last year. The United States spends more on national defense than the next 11 largest militaries combined. A well intended but feeble attempt by sections of the Democratic Party to cut 10% of the budget to go to health and human services failed because ultimately funding the 800 US military installations that occupy territory in more than 70 countries around the world takes precedence over something so basic and human as subsidized food programs. Meanwhile approximately 20% of the families in this country are struggling to obtain nutritious food every day just as one example of the growing social and health needs.
Wars and occupations are expensive and that money goes right down the drain. It does not recycle through the economy; rather it is equipment and operations meant to destroy and terrorize, and the only part of it that is reused is the militarization of police forces in the US who are geared out in advanced equipment for the wars at home not even normally seen in theaters of war abroad.
When Obama took over from Bush junior he vowed to end the war in Afghanistan and instead left office with the unique distinction of having had a war going every day of his 8 years in office. He launched airstrikes or military raids in at least seven countries: Afghanistan, Iraq, Syria, Libya, Yemen, Somalia and Pakistan and Trump came in and did not miss a beat and has carried the war of death, destruction and destabilization of Afghanistan into its twentieth year. The Pentagon knows that the days of outright winning a war are over and relies now on hybrid wars that are perhaps even more criminal. It is now wars of attrition with proxy and contract armies, aerial bombardment, sabotage of infrastructure that turns into endless wars, the intent of which is to make sure that a country is imbalanced, exhausted and does not become independent or develop and use its resources for the benefit of its own people.
This, of course, is not the only type of criminal warfare in the Empire’s arsenal. Economic sanctions are just as much a crime against humanity as military attacks. No one should ever forget the 10 years of the US orchestrated UN sanctions against Iraq in the 1990’s that were responsible for the deaths of 500,000 Iraqi children. Primarily through executive order Trump has put some sort of sanctions on around one third of the countries of the world ranging in severity starting with the 60 year old unilateral blockade of Cuba for the crime of insisting on its sovereignty just 90 miles away, to the sanctioning of medicines and food to Venezuela causing the deaths of 40,000 people, the outright stealing of billions of dollars of their assets out of banks, and organizing coup plots against the democratically elected President, Nicolas Maduro.
Now the chickens have come to roost with Trump sending shadowy military units of federal agents into cities like Portland, Seattle and other cities like it was a military invasion of some poor country, barging in uninvited not to bring order and peace but to brutalize, escalate and provoke people in the streets who for months now have been demanding real justice and equality. The combination of the failure of the Trump Administration to confront the pandemic with any sort of will or a national science based plan, the existing economic crisis with its glaring separation of wealth and the endless murdering of people of color as normal police policy has exposed the system like never before. The growing consciousness of a majority of the US population that now seem to be getting that there has to be fundamental change will be the catalyst for real change to happen. It will not come from a government that does not reflect their interests but only through a unity of struggle will we be pointed in a direction that will push US crimes against humanity, at home and abroad, to become a thing of the past.