Category Archives: Federal Reserve

The Fear Pandemic and the Crisis of Capitalism

In October 2019, in a speech at an International Monetary Fund conference, former Bank of England governor Mervyn King warned that the world was sleepwalking towards a fresh economic and financial crisis that would have devastating consequences for what he called the “democratic market system”.

According to King, the global economy was stuck in a low growth trap and recovery from the crisis of 2008 was weaker than that after the Great Depression. He concluded that it was time for the Federal Reserve and other central banks to begin talks behind closed doors with politicians.

In the repurchase agreement (repo) market, interest rates soared on 16 September. The Federal Reserve stepped in by intervening to the tune of $75 billion per day over four days, a sum not seen since the 2008 crisis.

At that time, according to Fabio Vighi, professor of critical theory at Cardiff University, the Fed began an emergency monetary programme that saw hundreds of billions of dollars per week pumped into Wall Street.

Over the last 18 months or so, under the guise of a ‘pandemic’, we have seen economies closed down, small businesses being crushed, workers being made unemployed and people’s rights being destroyed. Lockdowns and restrictions have facilitated this process. The purpose of these so-called ‘public health measures’ has little to do with public health and much to do with managing a crisis of capitalism and ultimately the restructuring of the economy.

Neoliberalism has squeezed workers income and benefits, offshored key sectors of economies and has used every tool at its disposal to maintain demand and create financial Ponzi schemes in which the rich can still invest in and profit from. The bailouts to the banking sector following the 2008 crash provided only temporary respite. The crash returned with a much bigger bang pre-Covid along with multi-billion-dollar bailouts.

The dystopian ‘great reset’ that we are currently witnessing is a response to this crisis. This reset envisages a transformation of capitalism.

Fabio Vighi sheds light on the role of the ‘pandemic’ in all of this:

… some may have started wondering why the usually unscrupulous ruling elites decided to freeze the global profit-making machine in the face of a pathogen that targets almost exclusively the unproductive (over 80s).

Vighi describes how, in pre-Covid times, the world economy was on the verge of another colossal meltdown and chronicles how the Swiss Bank of International Settlements, BlackRock (the world’s most powerful investment fund), G7 central bankers and others worked to avert a massive impending financial meltdown.

The world economy was suffocating under an unsustainable mountain of debt. Many companies could not generate enough profit to cover interest payments on their own debts and were staying afloat only by taking on new loans. Falling turnover, squeezed margins, limited cash flows and highly leveraged balance sheets were rising everywhere.

Lockdowns and the global suspension of economic transactions were intended to allow the Fed to flood the ailing financial markets (under the guise of COVID) with freshly printed money while shutting down the real economy to avoid hyperinflation.

Vighi says:

… the stock market did not collapse (in March 2020) because lockdowns had to be imposed; rather, lockdowns had to be imposed because financial markets were collapsing. With lockdowns came the suspension of business transactions, which drained the demand for credit and stopped the contagion. In other words, restructuring the financial architecture through extraordinary monetary policy was contingent on the economy’s engine being turned off.

It all amounted to a multi-trillion bailout for Wall Street under the guise of COVID ‘relief’ followed by an ongoing plan to fundamentally restructure capitalism that involves smaller enterprises being driven to bankruptcy or bought up by monopolies and global chains, thereby ensuring continued viable profits for these predatory corporations, and the eradication of millions of jobs resulting from lockdowns and accelerated automation.

Author and journalist Matt Taibbi noted in 2020:

It retains all the cruelties of the free market for those who live and work in the real world, but turns the paper economy into a state protectorate, surrounded by a kind of Trumpian Money Wall that is designed to keep the investor class safe from fear of loss. This financial economy is a fantasy casino, where the winnings are real but free chips cover the losses. For a rarefied segment of society, failure is being written out of the capitalist bargain.

The World Economic Forum says that by 2030 the public will ‘rent’ everything they require. This means undermining the right of ownership (or possibly seizing personal assets) and restricting consumer choice underpinned by the rhetoric of reducing public debt or ‘sustainable consumption’, which will be used to legitimise impending austerity as a result of the economic meltdown. Ordinary people will foot the bill for the ‘COVID relief’ packages.

If the financial bailouts do not go according to plan, we could see further lockdowns imposed, perhaps justified under the pretext of  ‘the virus’ but also ‘climate emergency’.

It is not only Big Finance that has been saved. A previously ailing pharmaceuticals industry has also received a massive bailout (public funds to develop and purchase the vaccines) and lifeline thanks to the money-making COVID jabs.

The lockdowns and restrictions we have seen since March 2020 have helped boost the bottom line of global chains and the e-commerce giants as well and have cemented their dominance. At the same time, fundamental rights have been eradicated under COVID government measures.

Capitalism and labour

Essential to this ‘new normal’ is the compulsion to remove individual liberties and personal freedoms. A significant part of the working class has long been deemed ‘surplus to requirements’ – such people were sacrificed on the altar of neo-liberalism. They lost their jobs due to automation and offshoring. Since then, this section of the population has had to rely on meagre state welfare and run-down public services or, if ‘lucky’, insecure low-paid service sector jobs.

What we saw following the 2008 crash was ordinary people being pushed further to the edge. After a decade of ‘austerity’ in the UK – a neoliberal assault on the living conditions of ordinary people carried out under the guise of reining in public debt following the bank bail outs – a leading UN poverty expert compared Conservative welfare policies to the creation of 19th-century workhouses and warned that, unless austerity is ended, the UK’s poorest people face lives that are “solitary, poor, nasty, brutish, and short”.

Philip Alston, the UN rapporteur on extreme poverty, accused ministers of being in a state of denial about the impact of policies. He accused them of the “systematic immiseration of a significant part of the British population”.

In another 2019 report, the Institute for Public Policy Research think tank laid the blame for more than 130,000 deaths in the UK since 2012 at the door of government policies. It claimed that these deaths could have been prevented if improvements in public health policy had not stalled as a direct result of austerity cuts.

Over the past 10 years in the UK, according to the Trussell Group, there has been rising food poverty and increasing reliance on food banks.

And in a damning report on poverty in the UK by Professor David Gordon of the University of Bristol, it was found that almost 18 million cannot afford adequate housing conditions, 12 million are too poor to engage in common social activities, one in three cannot afford to heat their homes adequately in winter and four million children and adults are not properly fed (Britain’s population is estimated at around 66 million).

Moreover, a 2015 report by the New Policy Institute noted that the total number of people in poverty in the UK had increased by 800,000, from 13.2 to 14.0 million in just two to three years.

Meanwhile, The Equality Trust in 2018 reported that the ‘austerity’ years were anything but austere for the richest 1,000 people in the UK. They had increased their wealth by £66 billion in one year alone (2017-2018), by £274 billion in five years (2013-2018) and had increased their total wealth to £724 billion – significantly more than the poorest 40% of households combined (£567 billion).

Just some of the cruelties of the ‘free market’ for those who live and work in the real world. And all of this hardship prior to lockdowns that have subsequently devastated lives, livelihoods and health, with cancer diagnoses and treatments and other conditions having been neglected due to the shutdown of health services.

During the current economic crisis, what we are seeing is many millions around the world being robbed of their livelihoods. With AI and advanced automation of production, distribution and service provision on the immediate horizon, a mass labour force will no longer be required.

It raises fundamental questions about the need for and the future of mass education, welfare and healthcare provision and systems that have traditionally served to reproduce and maintain labour that capitalist economic activity has required.

As the economy is restructured, labour’s relationship to capital is being transformed. If work is a condition of the existence of the labouring classes, then, in the eyes of capitalists, why maintain a pool of (surplus) labour that is no longer needed?

A concentration of wealth power and ownership is taking place as a result of COVID-related policies: according to research by Oxfam, the world’s billionaires gained $3.9 trillion while working people lost $3.7 trillion in 2020. At the same time, as large sections of the population head into a state of permanent unemployment, the rulers are weary of mass dissent and resistance. We are witnessing an emerging biosecurity surveillance state designed to curtail liberties ranging from freedom of movement and assembly to political protest and free speech.

The global implications are immense too. Barely a month into the COVID agenda, the IMF and World Bank were already facing a deluge of aid requests from developing countries that were asking for bailouts and loans. Ideal cover for rebooting the global economy via a massive debt crisis and the subsequent privatisation of national assets.

In 2020, World Bank Group President David Malpass stated that poorer countries will be ‘helped’ to get back on their feet after the various lockdowns but such ‘help’ would be on condition that neoliberal reforms become further embedded. In other words, the de facto privatisation of states (affecting all nations, rich and poor alike), the (complete) erosion of national sovereignty and dollar-denominated debt leading to a further strengthening of US leverage and power.

In a system of top-down surveillance capitalism with an increasing section of the population deemed ‘unproductive’ and ‘useless eaters’, notions of individualism, liberal democracy and the ideology of free choice and consumerism are regarded by the elite as ‘unnecessary luxuries’ along with political and civil rights and freedoms.

We need only look at the ongoing tyranny in Australia to see where other countries could be heading. How quickly Australia was transformed from a ‘liberal democracy’ to a brutal totalitarian police state of endless lockdowns where gathering and protests are not to be tolerated.

Being beaten and thrown to the ground and fired at with rubber bullets in the name of protecting health makes as much sense as devastating entire societies through socially and economically destructive lockdowns to ‘save lives’.

It makes as much sense as mask-wearing and social-distancing mandates unsupported by science, misused and flawed PCR tests, perfectly healthy people being labelled as ‘cases’, deliberately inflated COVID death figures, pushing dangerous experimental vaccines in the name of health, ramping up fear, relying on Neil Ferguson’s bogus modelling, censoring debate about any of this and the WHO declaring a worldwide ‘pandemic’ based on a very low number of global ‘cases’ back in early 2020 (44,279 ‘cases’ and 1,440 supposed COVID deaths outside China out of a population of 6.4 billion).

There is little if any logic to this. But of course, If we view what is happening in terms of a crisis of capitalism, it might begin to make a lot more sense.

The austerity measures that followed the 2008 crash were bad enough for ordinary people who were still reeling from the impacts when the first lockdown was imposed.

The authorities are aware that deeper, harsher impacts as well as much more wide-ranging changes will be experienced this time around and seem adamant that the masses must become more tightly controlled and conditioned to their coming servitude.

The post The Fear Pandemic and the Crisis of Capitalism first appeared on Dissident Voice.

Economic Collapse Continues Uninterrupted

To conceal the economic and social decline that continues to unfold at home and abroad, major newspapers are working overtime to promote happy economic news. Many headlines are irrational and out of touch. They make no sense. Desperation to convince everyone that all is well or all will soon be great is very high. The assault on economic science and coherence is intense. Working in concert, and contrary to the lived experience of millions of people, many newspapers are declaring miraculous “economic growth rates” for country after country. According to the rich and their media, numerous countries are experiencing or are on the cusp of experiencing very strong “come-backs” or “complete recoveries.” Very high rates of annual economic growth, generally not found in any prior period, are being floated regularly. The numbers defy common sense.

In reality, economic and social problems are getting worse nationally and internationally.

“Getting back to the pre-Covid standard will take time,” said Carmen Reinhart, the World Bank’s chief economist. “The aftermath of Covid isn’t going to reverse for a lot of countries. Far from it.” Even this recent statement is misleading because it implies that pre-Covid economic conditions were somehow good or acceptable when things have actually been going downhill for decades. Most economies never really “recovered” from the economic collapse of 2008. Most countries are still running on gas fumes while poverty, unemployment, under-employment, inequality, debt, food insecurity, generalized anxiety, and other problems keep worsening. And today, with millions of people fully vaccinated and trillions of phantom dollars, euros, and yen printed by the world’s central banks, there is still no real and sustained stability, prosperity, security, or harmony. People everywhere are still anxious about the future. Pious statements from world leaders about “fixing” capitalism have done nothing to reverse the global economic decline that started years ago and was intensified by the “COVID Pandemic.”

In the U.S. alone, in real numbers, about 3-4 million people a month have been laid off for 13 consecutive months. At no other time in U.S. history has such a calamity on this scale happened. This has “improved” slightly recently but the number of people being laid off every month remains extremely high and troubling. In New York State, for example:

the statewide [official] unemployment rate remains the second highest in the country at just under 9%. One year after the start of the pandemic and the recession it caused, most of the jobs New York lost still have not come back. (emphasis added, April 2021).

In addition, nationally the number of long-term unemployed remains high and the labor force participation rate remains low. And most new jobs that are “created” are not high-paying jobs with good benefits and security. The so-called “Gig Economy” has beleaguered millions.

Some groups have been more adversely affected than others. In April 2021, U.S. News & World Report conveyed that:

In February 2020, right before the coronavirus was declared a pandemic by the World Health Organization, Black women had an employment to population ratio of 60.8%; that now stands at 54.8%, a drop of 6 percentage points.

The obsolete U.S. economic system has discarded more than half a million black women from the labor force in the past year.

In December 2019, around the time the “COVID Pandemic” began to emerge, Brookings reported that:

An estimated 53 million people—44 percent of all U.S. workers ages 18–64—are low-wage workers. That’s more than twice the number of people in the 10 most populous U.S. cities combined. Their median hourly wage is $10.22, and their median annual earnings are $17,950.

The Federal Reserve reports that 37 percent of Americans in 2019 did not have $400 to cover an unanticipated emergency. In Louisiana alone, 1 out of 5 families today are living at the poverty level.  Sadly, “60% of Americans will live below the official poverty line for at least one year of their lives.” While American billionaires became $1.3 trillion richer, about 8 million Americans joined the ranks of the poor during the “COVID Pandemic.”

And more inflation will make things worse for more people. A March 2021 headline from NBC News reads: “The price of food and gas is creeping higher — and will stay that way for a while.”  ABC News goes further in April 2021 and says that “the post-pandemic economy will include higher prices, worse service, longer delays.”

Homelessness in the U.S. is also increasing:

COVID-driven loss of jobs and employment income will cause the number of homeless workers to increase each year through 2023. Without large-scale, government employment programs the Pandemic Recession is projected to cause twice as much homelessness as the 2008 Great Recession. Over the next four years the current Pandemic Recession is projected to cause chronic homelessness to increase 49 percent in the United States, 68 percent in California and 86 percent in Los Angeles County. [The homeless include the] homeless on the streets, shelter residents and couch surfers. (emphasis added, January 11, 2021)

Perhaps ironically, just “Two blocks from the Federal Reserve, a growing encampment of the homeless grips the economy’s most powerful person [Federal Reserve Chairman Jerome Powell].”

Officially, about four million businesses, including more than 110,000 restaurants, have permanently closed in the U.S. over the past 14 months.  In April 2021 Business Insider stated that, “roughly 80,000 stores are doomed to close in the next 5 years as the retail apocalypse continues to rip through America.”  The real figure is likely higher.

Bankruptcies have also risen in some sectors. For example, bankruptcies by North American oil producers “rose to the highest first-quarter level since 2016.”

In March 2021 the Economic Policy Institute reported that “more than 25 million workers are directly harmed by the COVID labor market.” Anecdotal evidence suggests that there are more than 100 applicants for each job opening in some sectors.

Given the depth and breadth of the economic collapse in the U.S., it is no surprise that “1 in 6 Americans went into therapy for the first time in 2020.” The number of people affected by depression, anxiety, addiction, and suicide worldwide as a direct result of the long depression is very high. These harsh facts and realities are also linked to more violence, killings, protests, demonstrations, social unrest, and riots worldwide.

In terms of physical health, “Sixty-one percent of U.S. adults report undesired weight changes since the COVID-19 pandemic began.” This will only exacerbate the diabetes pandemic that has been ravaging more countries every year.

On another front, the Pew Research Center informs us that, as a result of the economic collapse that has unfolded over the past year, “A majority of young adults in the U.S. live with their parents for the first time since the Great Depression.”   And it does not help that student debt now exceeds $1.7 trillion and is still climbing rapidly.

Millions of college faculty have also suffered greatly over the past year. A recent survey by the American Association of University Professors (AAUP) found that:

real wages for full-time faculty decreased for the first time since the Great Recession[in 2008], and average wage growth for all ranks of full-time faculty was the lowest since the AAUP began tracking annual wage growth in 1972. After adjusting for inflation, real wages decreased at over two-thirds of colleges and universities. The number of full-time faculty decreased at over half of institutions.

This does not account for the thousands of higher education adjuncts (part-time faculty) and staff that lost their jobs permanently.

In April 2021, the Center on Budget & Policy Priorities stated that, “millions of people are still without their pre-pandemic income sources and are borrowing to get by.” Specifically:

  • 54 million adults said they didn’t use regular income sources like those received before the pandemic to meet their spending needs in the last seven days.
  • 50 million used credit cards or loans to meet spending needs.
  • 20 million borrowed from friends or family. (These three groups overlap.)

Also in April 2021, the Washington Post wrote:

The pandemic’s disruption has created inescapable financial strain for many Americans. Nearly 2 of 5 of adults have postponed major financial decisions, from buying cars or houses to getting married or having children, due to the coronavirus crisis, according to a survey last week from Bankrate.com. Among younger adults, ages 18 to 34, some 59 percent said they had delayed a financial milestone. (emphasis added)

According to Monthly Review:

The U.S. economy has seen a long-term decline in capacity utilization in manufacturing, which has averaged 78 percent from 1972 to 2019—well below levels that stimulate net investment. (emphasis added, January 1, 2021).

Capitalist firms will not invest in new ventures or projects when there is little or no profit to be made, which is why major owners of capital are engaged in even more stock market manipulation than ever before. “Casino capitalism” is intensifying. This, in turn, is giving rise to even larger stock market bubbles that will eventually burst and wreak even more havoc than previous stock market crashes. The inability to make profit through normal investment channels is also why major owners of capital are imposing more public-private “partnerships” (PPPs) on people and society through neoliberal state restructuring. Such pay-the-rich schemes further marginalize workers and exacerbate inequality, debt, and poverty. PPPs solve no problems and must be replaced by human-centered economic arrangements.

The International Labor Organization estimates that the equivalent of 255 million full-time jobs have been lost globally as a result of government actions over the past 13-14 months.

In March of this year, the Food and Agricultural Organization (FAO) of the United Nations reported that, “Acute hunger is set to soar in over 20 countries in the coming months without urgent and scaled-up assistance.” The FAO says, “”The magnitude of suffering is alarming.”

And according to Reuters, “Overall, global FDI [Foreign Direct Investment] had collapsed in 2020, falling by 42% to an estimated $859 billion, from $1.5 trillion in 2019, according to the UNCTAD report.” UNCTAD stands for United Nations Conference on Trade and Development.

The international organization Oxfam tells us that:

The coronavirus pandemic has the potential to lead to an increase in inequality in almost every country at once, the first time this has happened since records began…. Billionaire fortunes returned to their pre-pandemic highs in just nine months, while recovery for the world’s poorest people could take over a decade. (emphasis added, January 25, 2021)

According to the World Bank, “The COVID-19 pandemic has pushed about 120 million people into extreme poverty over the last year in mostly low- and middle-income countries.”  And despite the roll-out of vaccines in various countries:

the economic implications of the pandemic are deep and far-reaching. It is ushering in a “new poor” profile that is more urban, better educated, and reliant on informal sector work such as construction, relative to the existing global poor (those living on less than $1.90/day) who are more rural and heavily reliant on agriculture. (emphasis added)

Another source notes that:

Pew Research Center, using World Bank data, has estimated that the number of poor in India (with income of $2 per day or less in purchasing power parity) has more than doubled from 60 million to 134 million in just a year due to the pandemic-induced recession. This means, India is back in a situation to be called a “country of mass poverty” after 45 years. (emphasis added)

In Europe, there is no end in sight to the economic decline that keeps unfolding. The United Kingdom, for example, experienced its worst economy in literally 300 years:

The economy in the U.K. contracted 9.9 percent in 2020, the worst year on record since 1709, the Office for National Statistics (ONS) said in a report on Friday (Feb. 12). The overall economic drop in 2020 was more than double in 2009, when U.K. GDP declined 4.1 percent due to the worldwide financial crisis. Britain experienced the biggest annual decline among the G7 economies — France saw its economy decline 8.3 percent, Italy dropped 8.8 percent, Germany declined 5 percent and the U.S. contracted 3.5 percent. (emphasis added)

Another source also notes that, “The Eurozone is being haunted by ‘ghost bankruptcies,’ with more than 200,000 firms across the European Union’s four biggest nations under threat when Covid financial lifelines stop.” In another sign of economic decline, this time in Asia, Argus Media reported in April 2021 that Japan’s 2020-21 crude steel output fell to a 52-year low.

Taken alone, on a country-by-country basis, these are not minor economic downturns, but when viewed as a collective cumulative global phenomenon, the consequences are more serious. It is a big problem when numerous economies decline simultaneously. The world is more interdependent and interconnected than ever. What happens in one region necessarily affects other regions.

One could easily go country by country and region by region and document many tragic economic developments that are still unfolding and worsening. Argentina, Lebanon, Colombia, Turkey, Brazil, Mexico, Jordan, South Africa, Nigeria, and dozens of other countries are all experiencing major economic setbacks and hardships that will take years to overcome and will negatively affect the economies of other countries in an increasingly interdependent world. And privatization schemes around the world are just making conditions worse for the majority of people. Far from solving any problems, neoliberalism has made everything worse for working people and society.

It is too soon for capitalist ideologues to be euphoric about “miraculous economic growth and success.” There is no meaningful evidence to show that there is deep, significant, sustained economic growth on a broad scale. There is tremendous economic carnage and pain out there, and the scarring and consequences are going to linger for some time. No one believes that a big surge of well-paying jobs is right around the corner. Nor does anyone believe that more schemes to pay the rich under the banner of high ideals will improve things either.

Relentless disinformation about the economy won’t solve any problems or convince people that they are not experiencing what they are experiencing. Growing poverty, hunger, homelessness, unemployment, under-employment, debt, inequality, anxiety, and insecurity are real and painful. They require real solutions put forward by working people, not major owners of capital concerned only with maximizing private profit as fast as possible.

The economy cannot improve and serve a pro-social aim and direction so long as those who produce society’s wealth, workers, are disempowered and denied any control of the economy they run. Allowing major decisions to be made by a historically superfluous financial oligarchy is not the way forward. The rich and their representatives are unfit to rule and have no real solutions for the recurring crises caused by their outmoded system. They are focused mainly on depriving people of an outlook that opens the path of progress to society.

There is no way for the massive wealth of society to be used to serve the general interests of society so long as the contradiction between the socialized nature of the economy and its continued domination by competing private interests remain unresolved. All we are left with are recurring economic crises that take a bigger and bigger toll on humanity. To add insult to injury, we are told that there is no alternative to this outdated system, and that the goal is to strive for “inclusive capitalism,” “ethical capitalism,” “responsible capitalism,” or some other oxymoron.

But there is an alternative. Existing conditions do not have to be eternal or tolerated. History shows that conditions that favor the people can be established. The rich must be deprived of their ability to deprive the people of their rights, including the right to govern their own affairs and control the economy. The economy, government, nation-building, and society must be controlled and directed by the people themselves, free of the influence of narrow private interests determined to enrich themselves at the expense of everyone and everything else.

The rich and their political and media representatives are under great pressure to distort social consciousness, undermine the human factor, and block progress. The necessity for change is for humanity to rise up and usher in a modern society that ensures prosperity, stability, and peace for all. It can be done and must be done.

The post Economic Collapse Continues Uninterrupted first appeared on Dissident Voice.

Will 2021 Be Public Banking’s Watershed Moment?

Just over two months into the new year, 2021 has already seen a flurry of public banking activity. Sixteen new bills to form publicly-owned banks or facilitate their formation were introduced in eight U.S. states in January and February. Two bills for a state-owned bank were introduced in New Mexico, two in Massachusetts, two in New York, one each in Oregon and Hawaii, and Washington State’s Public Bank Bill was re-introduced as a “Substitution.” Bills for city-owned banks were introduced in Philadelphia and San Francisco, and bills facilitating the formation of public banks or for a feasibility study were introduced in New York, Oregon (three bills), and Hawaii.

In addition, California is expected to introduce a bill for a state-owned bank later this year, and New Jersey is moving forward with a strong commitment from its governor to implement one. At the federal level, three bills for public banking were also introduced last year: the National Infrastructure Bank Bill (HR 6422), a new Postal Banking Act (S 4614), and the Public Banking Act (HR 8721). (For details on all these bills, see the Public Banking Institute website here.)

As Oscar Abello wrote on NextCity.org in February, “2021 could be public banking’s watershed moment.… Legislators are starting to see public banks as a powerful potential tool to ensure a recovery that is more equitable than the last time.”

Why the Surge in Interest?

The devastation caused by nationwide Covid-19 lockdowns in 2020 has highlighted the inadequacies of the current financial system in serving the public, local businesses, and local governments. Nearly 10 million jobs were lost to the lockdowns, over 100,000 businesses closed permanently, and a quarter of the population remains unbanked or underbanked. Over 18 million people are receiving unemployment benefits, and moratoria on rent and home foreclosures are due to expire this spring.

Where was the Federal Reserve in all this? It poured out trillions of dollars in relief, but the funds did not trickle down to the real economy. They flooded up, dramatically increasing the wealth gap. By October 2020, the top 1% of the U.S. population held 30.4% of all household wealth, 15 times that of the bottom 50%, which held just 1.9% of all wealth.

State and local governments are also in dire straits due to the crisis. Their costs have shot up and their tax bases have shrunk. But the Fed’s “special purpose vehicles” were no help. The Municipal Liquidity Facility, ostensibly intended to relieve municipal debt burdens, lent at market interest rates plus a penalty, making borrowing at the facility so expensive that it went nearly unused; and it was discontinued in December.

The Fed’s emergency lending facilities were also of little help to local businesses. In a January 2021 Wall Street Journal article titled “Corporate Debt ‘Relief’ Is an Economic Dud,” Sheila Bair, former chair of the Federal Deposit Insurance Corporation, and Lawrence Goodman, president of the Center for Financial Stability, observed:

The creation of the corporate facilities last March marked the first time in history that the Fed would buy corporate debt… The purpose of the corporate facilities was to help companies access debt markets during the pandemic, making it possible to sustain operations and keep employees on payroll. Instead, the facilities resulted in a huge and unnecessary bailout of corporate debt issuers, underwriters and bondholders….This created a further unfair opportunity for large corporations to get even bigger by purchasing competitors with government-subsidized credit.

…. This presents a double whammy for the young companies that have been hit hardest by the pandemic. They are the primary source of job creation and innovation, and squeezing them deprives our economy of the dynamism and creativity it needs to thrive.

In a September 2020 study for ACRE called “Cancel Wall Street,” Saqib Bhatti and Brittany Alston showed that U.S. state and local governments collectively pay $160 billion annually just in interest in the bond market, which is controlled by big private banks. For comparative purposes, $160 billion would be enough to help 13 million families avoid eviction by covering their annual rent; and $134 billion could make up the revenue shortfall suffered by every city and town in the U.S. due to the pandemic.

Half the cost of infrastructure generally consists of financing, doubling its cost to municipal governments. Local governments are extremely good credit risks; yet private, bank-affiliated rating agencies give them a lower credit score (raising their rates) than private corporations, which are 63 times more likely to default. States are not allowed to go bankrupt, and that is also true for cities in about half the states. State and local governments have a tax base to pay their debts and are not going anywhere, unlike bankrupt corporations, which simply disappear and leave their creditors holding the bag.

How Publicly-owned Banks Can Help 

Banks do not have the funding problems of local governments. In March 2020, the Federal Reserve reduced the interest rate at its discount window, encouraging all banks in good standing to borrow there at 0.25%. No stigma or strings were attached to this virtually free liquidity – no need to retain employees or to cut dividends, bonuses, or the interest rates charged to borrowers. Wall Street banks can borrow at a mere one-quarter of one percent while continuing to charge customers 15% or more on their credit cards.

Local governments extend credit to their communities through loan funds, but these “revolving funds” can lend only the capital they have. Depository banks, on the other hand, can leverage their capital, generating up to ten times their capital base in loans. For a local government with its own depository bank, that would mean up to ten times the credit to inject into the local economy, and ten times the profit to be funneled back into community needs. A public depository bank could also borrow at 0.25% from the Fed’s discount window.

North Dakota Leads the Way

What a state can achieve by forming its own bank has been demonstrated in North Dakota. There  the nation’s only state-owned bank was formed in 1919 when North Dakota farmers were losing their farms to big out-of-state banks. Unlike the Wall Street megabanks mandated to make as much money as possible for their shareholders, the Bank of North Dakota (BND) is mandated to serve the public interest. Yet it has had a stellar return on investment, outperforming even J.P. Morgan Chase and Goldman Sachs. In its 2019 Annual Report, the BND reported its sixteenth consecutive year of record profits, with $169 million in income, just over $7 billion in assets, and a hefty return on investment of 18.6%.

The BND maximizes its profits and its ability to serve the community by eliminating profiteering middlemen. It has no private shareholders bent on short-term profits, no high-paid executives, no need to advertise for depositors or borrowers, and no need for multiple branches. It has a massive built-in deposit base, since the state’s revenues must be deposited in the BND by law. It does not compete with North Dakota’s local banks in the retail market but instead partners with them. The local bank services and retains the customer, while the BND helps as needed with capital and liquidity. Largely due to this amicable relationship, North Dakota has nearly six times as many local financial institutions per person as the country overall.

The BND has performed particularly well in economic crises. It helped pay the state’s teachers during the Great Depression, and sold foreclosed farmland back to farmers in the 1940s. It has also helped the state recover from a litany of natural disasters.

Its emergency capabilities were demonstrated in 1997, when record flooding and fires devastated Grand Forks, North Dakota. The town and its sister city, East Grand Forks on the Minnesota side of the Red River, lay in ruins. The response of the BND was immediate and comprehensive, demonstrating a financial flexibility and public generosity that no privately-owned bank could match. The BND quickly established nearly $70 million in credit lines and launched a disaster relief loan program; worked closely with federal agencies to gain forbearance on federally-backed home loans and student loans; and reduced interest rates on existing family farm and farm operating programs. The BND obtained funds at reduced rates from the Federal Home Loan Bank and passed the savings on to flood-affected borrowers. Grand Forks was quickly rebuilt and restored, losing only 3% of its population by 2000, compared to 17% in East Grand Forks on the other side of the river.

In the 2020 crisis, North Dakota shone again, leading the nation in getting funds into the hands of workers and small businesses. Unemployment benefits were distributed in North Dakota faster than in any other state, and small businesses secured more Payroll Protection Program funds per worker than in any other state. Jeff Stein, writing in May 2020 in The Washington Post, asked:

What’s their secret? Much credit goes to the century-old Bank of North Dakota, which — even before the PPP officially rolled out — coordinated and educated local bankers in weekly conference calls and flurries of calls and emails.

According Eric Hardmeyer, BND’s president and chief executive, BND connected the state’s small bankers with politicians and U.S. Small Business Administration officials and even bought some of their PPP loans to help spread out the cost and risk….

BND has already rolled out two local successor programs to the PPP, intended to help businesses restart and rebuild. It has also offered deferments on its $1.1 billion portfolio of student loans.

Public Banks Excel Globally in Crises

Publicly-owned banks around the world have responded quickly and efficiently to crises. As of mid-2020, public banks worldwide held nearly $49 trillion in combined assets; and including other public financial institutions, the figure reached nearly $82 trillion. In a 2020 compendium of cases studies titled Public Banks and Covid 19: Combatting the Pandemic with Public Finance, the editors write:

Five overarching and promising lessons stand out: public banks have the potential to respond rapidly; to fulfill their public purpose mandates; to act boldly; to mobilize their existing institutional capacity; and to build on ‘public-public’ solidarity. In short, public banks are helping us navigate the tidal wave of Covid-19 at the same time as private lenders are turning away….

Public banks have crafted unprecedented responses to allow micro-, small- and medium-sized enterprises (MSMEs), large businesses, public entities, governing authorities and households time to breathe, time to adjust and time to overcome the worst of the crisis. Typically, this meant offering liquidity with generously reduced rates of interest, preferential repayment terms and eased conditions of repayment. For the most vulnerable in society, public banks offered non-repayable grants.

The editors conclude that public banks offer a path toward democratization (giving society a meaningful say in how financial resources are used) and definancialization (moving away from speculative predatory investment practices toward financing that grows the real economy). For local governments, public banks offer a path to escape monopoly control by giant private financial institutions over public policies.

This article was first posted on ScheerPost.

The post Will 2021 Be Public Banking’s Watershed Moment? first appeared on Dissident Voice.

Vaccinations and Stimulus Packages Won’t Mend the Economy

The social and economic destruction engulfing the U.S. and dozens of other countries remains out of everyone’s control and more chaos, instability, and insecurity now mark the global landscape.

The ruling elite have repeatedly shown their inability to tackle any serious problems effectively. They are at a loss for how to deal with current problems and refuse to consider any alternative to their obsolete economic system. The best they can do is recycle old ideas to maintain their class power and privilege. Their efforts to block the New focus mainly on promoting disinformation about “new and better forms of capitalism,” including oxymorons like “inclusive capitalism,” “responsible capitalism,” and “ethical capitalism.”

Since the outbreak of the “COVID Pandemic” in March 2020 every week has been a roller coaster for humanity. The economy and society keep lurching from one crisis to another while incoherence and stress keep amplifying. It is said that 1 in 6 Americans went into therapy for the first time in 2020.

Unemployment, under-employment, inequality, mental depression, anxiety, suicide, environmental decay, inflation, debt, health care costs, education, and poverty are worsening everywhere. Thousands of businesses that have been around for years keep disappearing left and right.

Top-down actions in response to the “COVID Pandemic” have made so many things worse for so many people. Many are wondering which is worse: the covid-19 virus or the top-down response to the pandemic. Governments everywhere have steadfastly refused to mobilize the people to solve the many problems that are worsening. The moral climate is low and more people are worried about the future.

An atmosphere has been created whereby people are supposed to feel like the exhausting “COVID Pandemic” will last forever and we can all forget about getting back to any normal healthy non-digital relations, activities, and interactions. No society in history has worn face masks for an entire year. We are told over and over again that there is no returning to anything called “normal.” Moving everything online and repeatedly asserting that this is great, “cool,” and wonderful is proving to be unsatisfactory and unfulfilling. People want and need real, direct, non-digital connections and interactions with other human beings. Life behind a screen is not life.

Even with all the restrictions and shutdowns the virus, according to the mainstream media, continues to wreak havoc at home and abroad. It is almost like none of the severe restrictions on people’s freedoms made any difference. People have had to endure this humiliation while also not being permitted any role in deciding the aim, operation, and direction of the economy or any of the affairs of society; they are left out of the equation every step of the way and not even asked for superficial “input” that always goes unheeded anyway. Existing governance arrangements are simply not working to empower people or affirm their rights. The people’s interests and will are blocked at every turn by an outdated political setup that advances only the narrow interests of the rich.

Despite intense pressure to blindly rely on the rich and their political representatives to “figure things out,” this is not working. Nor does it help that the mainstream media approaches multiple crises and issues with endless double-talk, disconnected facts, catchy sound-bites, dramatic exaggerations, angry voices, political axe-grinding, and lots of confusion. Coherence and a human-centered outlook are avoided at all costs. People are constantly left disoriented. Jumping arbitrarily and rapidly from one thing to another in the most unconscious way is presented as useful analysis and information. This is why sorting out basic information has become a full-time job for everyone. People are understandably worn-out and overwhelmed. Disinformation overload degrades mental, emotional, and physical health.

The world has become an uglier and gloomier place—all in the name of “improving health.” It is no surprise that a recent Gallup Poll shows that the majority of Americans are extremely dissatisfied with government, the economy, the culture, and the moral climate.

In this hazardous unstable context, there are two ever-present key pieces of disinformation operating side by side. Both are designed to deprive working people of any say, initiative, outlook, or power.

First there is the “once everyone is vaccinated things will be much better” disinformation. This ignores the fact that capitalist crises have endogenous causes not exogenous causes and that the economic crisis started well before the “COVID Pandemic.” More than 150 years of recessions, depressions, booms, busts, instability, chaos, and anarchy have not been caused by external phenomena like bacteria, germs, and viruses but by the internal logic and operation of capital itself. A so-called “free market” economy by its very nature and logic ensures “winners” and “losers,” “booms” and “busts.” It is called a “dog-eat-dog” fend-for-yourself competitive world for a reason. The modern idea that humans are born to society and have rights by virtue of their being is alien to “free market” ideology.

Despite the fact that millions have been vaccinated at home and abroad, poverty, inequality, unemployment, debt, and other problems continue to worsen. Businesses continue to suffer and disappear. Hospitality, leisure, recreation, and other sectors have been decimated in many countries. Air travel is dramatically lower. So are car sales. It is not enough to say, “Yes, the next few months will be rough and lousy economically speaking but we will get there with more vaccinations. Just be patient, it will all eventually work out.” This is not what is actually unfolding. The all-sided crisis we find ourselves in started before the “COVID Pandemic” and continues unabated. Such a view also makes a mockery of economic science and the people’s desire to decide the affairs of society and establish much better arrangements that exclude narrow private interests and do not rely on police powers.

In the coming months millions more will be vaccinated but economic decline and decay will continue. Both the rate and amount of profit have been falling for years. And owners of capital are not going to invest in anything when there is no profit to be had and when it is easier instead to balloon fictitious capital and pretend everything is a stock market video game. The lack of vaccinations did not cause the economic collapse the word is currently suffering through, nor will more vaccinations reverse economic decline and decay. The “COVID Pandemic” has largely made some people vastly richer and millions more much poorer. The “COVID Pandemic” has significantly increased inequality. Unfortunately, the so-called “Great Reset” agenda of the World Economic Forum and Pope Francis’s recent call for a “Copernican Revolution” in the economy will make things worse for millions more because they will perpetuate the existing moribund economic system. Such agendas are designed to fool the gullible, block working class consciousness and action, and keep the initiative in the hands of the global oligarchy.

The same applies to so-called “stimulus packages.” Various versions of these top-down monetary and fiscal programs have been launched in different countries, and while they have assuaged some problems for people, they have not been adequate or fixed any underlying problems. They have not prevented poverty or mass unemployment. Economies remain mired in crisis. In most cases “stimulus packages” have made things worse by increasing the amount of debt that many generations will have to repay. This is in addition to the many other forms of debt Americans suffer from and rent payments that will one day have to be paid.

Many are also wondering why trillions of dollars can be printed and instantly turned over to the banks and corporations with no discussion but the same cannot be done for social programs, public enterprises, and the people. Why, for example, can all not get free healthcare or have taxes eliminated? Why can’t various forms of personal debt be wiped out instantly? If the government can print money for “them” why can’t they print money for “us”? Who is government supposed to serve? Billionaires?

Nether the CARES Act of 2020 nor the stimulus package passed in December 2020 nor the one President Biden is pushing for in March 2021 will be adequate or solve any major problems. Many felt that the $600 stimulus checks that went out in December 2020 were pathetic and insulting.

The problem lies with a socialized productive economy run by everyone but owned and controlled by a tiny handful of competing private interests determined to maximize profit as fast as possible regardless of the damage to the social and natural environment. There is no way for the economy to benefit all individuals and serve the general interests of society so long as it is dominated by a handful of billionaires. The social wealth produced by workers cannot benefit workers and the society if workers themselves do not control the wealth they produce and have first claim to.

The outlook, agenda, and reference points of the rich must be rejected and replaced by a human-centered aim, agenda, direction, and outlook. The current trajectory is untenable and unsustainable. The situation is dangerous in many ways, but perhaps one good thing to come out of the accelerated pace of chaos, anarchy, and instability are the contradictions that are presenting new opportunities for action with analysis that favors working people.

The post Vaccinations and Stimulus Packages Won’t Mend the Economy first appeared on Dissident Voice.

Tackling the Infrastructure and Unemployment Crises: The “American System” Solution

A self-funding national infrastructure bank modeled on the “American System” of Alexander Hamilton, Abraham Lincoln, and Franklin D. Roosevelt would help solve two of the country’s biggest problems.

Millions of Americans have joined the ranks of the unemployed, and government relief checks and savings are running out; meanwhile, the country still needs trillions of dollars in infrastructure. Putting the unemployed to work on those infrastructure projects seems an obvious solution, especially given that the $600 or $700 stimulus checks Congress is planning on issuing will do little to address the growing crisis. Various plans for solving the infrastructure crisis involving public-private partnerships have been proposed, but they’ll invariably result in private investors reaping the profits while the public bears the costs and liabilities. We have relied for too long on private, often global, capital, while the Chinese run circles around us building infrastructure with credit simply created on the books of their government-owned banks.

Earlier publicly-owned U.S. national banks and U.S. Treasuries pulled off similar feats, using what Sen. Henry Clay, U.S. statesman from 1806 to 1852, named the “American System” – funding national production simply with “sovereign” money and credit. They included the First (1791-1811) and Second (1816-1836) Banks of the United States, President Lincoln’s federal treasury and banking system, and President Franklin Roosevelt’s Reconstruction Finance Corporation (RFC) (1932-1957). Chester Morrill, former Secretary of the Board of Governors of the Federal Reserve, wrote of the RFC:

[I]t became apparent almost immediately, to many Congressmen and Senators, that here was a device which would enable them to provide for activities that they favored for which government funds would be required, but without any apparent increase in appropriations. . . . [T]here need be no more appropriations and its activities could be enlarged indefinitely, as they were, almost to fantastic proportions. [emphasis added]

Even the Federal Reserve with its “quantitative easing” cannot fund infrastructure without driving up federal expenditures or debt, at least without changes to the Federal Reserve Act. The Fed is not allowed to spend money directly into the economy or to lend directly to Congress. It must go through the private banking system and its “primary dealers.” The Fed can create and pay only with “reserves” credited to the reserve accounts of banks. These reserves are a completely separate system from the deposits circulating in the real producer/consumer economy; and those deposits are chiefly created by banks when they make loans. (See the Bank of England’s 2014 quarterly report here.) New liquidity gets into the real economy when banks make loans to local businesses and individuals; and in risky environments like that today, banks are not lending adequately even with massive reserves on their books.

A publicly-owned national infrastructure bank, on the other hand, would be mandated to lend into the real economy; and if the loans were of the “self funding” sort characterizing most infrastructure projects (generating fees to pay off the loans), they would be repaid, canceling out the debt by which the money was created. That is how China built 12,000 miles of high-speed rail in a decade: credit created on the books of government-owned banks was advanced to pay for workers and materials, and the loans were repaid with profits from passenger fees.

Unlike the QE pumped into financial markets, which creates asset bubbles in stocks and housing, this sort of public credit mechanism is not inflationary. Credit money advanced for productive purposes balances the circulating money supply with new goods and services in the real economy. Supply and demand rise together, keeping prices stable. China increased its money supply by nearly 1800% over 24 years (from 1996 to 2020) without driving up price inflation, by increasing GDP in step with the money supply.

HR 6422, The National Infrastructure Bank Act of 2020

A promising new bill for a national infrastructure bank modeled on the RFC and the American System, H.R. 6422, was filed by Rep. Danny Davis, D-Ill., in March. The National Infrastructure Bank of 2020 (NIB) is projected to create $4 trillion or more in bank credit money to rebuild the nation’s rusting bridges, roads, and power grid; relieve traffic congestion; and provide clean air and water, new schools and affordable housing. It will do this while generating up to 25 million union jobs paying union-level wages. The bill projects a net profit to the government of $80 billion per year, which can be used to cover infrastructure needs that are not self-funding (broken pipes, aging sewers, potholes in roads, etc.). The bill also provides for substantial investment in “disadvantage communities,” those defined by persistent poverty.

The NIB is designed to be a true depository bank, giving it the perks of those institutions for leverage and liquidity, including the ability to borrow at the Fed’s discount window without penalty at 0.25% interest (almost interest-free). According to Alphecca Muttardy, a former macroeconomist for the International Monetary Fund and chief economist on the 2020 NIB team, the NIB will create the $4 trillion it lends simply as deposits on its books, as the Bank of England attests all depository banks do. For liquidity to cover withdrawals, the NIB can either borrow from the Fed at 0.25% or issue and sell bonds.

Modeled on its American System predecessors, the NIB will be capitalized with existing federal government debt. According to the summary on the NIB Coalition website:

The NIB would be capitalized by purchasing up to $500 billion in existing Treasury bonds held by the private sector (e.g., in pension and other savings funds), in exchange for an equivalent in shares of preferred [non-voting] stock in the NIB. The exchange would take place via a sales contract with the NIB/Federal Government that guarantees a preferred stock dividend of 2% more than private-holders currently earn on their Treasuries. The contract would form a binding obligation to provide the incremental 2%, or about $10 billion per year, from the Budget. While temporarily appearing as mandatory spending under the Budget, the $10 billion per year would ultimately be returned as a dividend paid to government, from the NIB’s earnings stream.

Since the federal government will be paying the interest on the bonds, the NIB needs to come up with only the 2% dividend to entice investors. The proposal is to make infrastructure loans at a very modest 2%, substantially lower than the rates now available to the state and local governments that create most of the nation’s infrastructure. At a 10% capital requirement, the bonds can capitalize ten times their value in loans. The return will thus be 20% on a 2% dividend outlay from the NIB, for a net return on investment of 18% less operating costs. The U.S. Treasury will also be asked to deposit Treasury bonds with the bank as an “on-call” subscriber.

The American System: Sovereign Money and Credit

U.S. precedents for funding internal improvements with “sovereign credit” – credit issued by the national government rather than borrowed from the private banking system – go back to the American colonists’ paper scrip, colonial Pennsylvania’s “land bank”, and the First U.S. Bank of Alexander Hamilton, the first U.S. Treasury Secretary. Hamilton proposed to achieve the constitutional ideal of “promoting the general welfare” by nurturing the country’s fledgling industries with federal subsidies for roads, canals, and other internal improvements; protective measures such as tariffs; and easy credit provided through a national bank. Production and the money to finance it would all be kept “in house,” without incurring debt to foreign financiers. The national bank would promote a single currency, making trade easier, and would issue loans in the form of “sovereign credit.” ’

Senator Henry Clay called this model the “American System” to distinguish it from the “British System” that left the market to the “invisible hand” of “free trade,” allowing big monopolies to gobble up small entrepreneurs, and foreign bankers and industrialists to exploit the country’s labor and materials. After the charter for the First US Bank expired in 1811, Congress created the Second Bank of the United States in 1816 on the American System model.

In 1836, Pres. Andrew Jackson shut down the Second U.S. Bank due to perceived corruption, leaving the country with no national currency and precipitating a recession.  “Wildcat” banks issued their own banknotes – promissory notes allegedly backed by gold. But the banks often lacked the gold necessary to redeem the notes, and the era was beset with bank runs and banking crises.

Abraham Lincoln’s economic advisor was Henry Carey, the son of Matthew Carey, a well-known printer and publisher who had been tutored by Benjamin Franklin and had tutored Henry Clay. Henry Carey proposed creating an independent national currency that was non-exportable, one that would remain at home to do the country’s own work. He advocated a currency founded on “national credit,” something he defined as “a national system based entirely on the credit of the government with the people, not liable to interference from abroad.” It would simply be a paper unit of account that tallied work performed and goods delivered.

On that model, in 1862 Abraham Lincoln issued U.S. Notes or Greenbacks directly from the U.S. Treasury, allowing Lincoln’s government not only to avoid an exorbitant debt to British bankers and win the Civil War, but to fund major economic development, including tying the country together with the transcontinental railroad – an investment that actually turned a profit for the government.

After Lincoln was assassinated in 1865, the Greenback program was discontinued; but Lincoln’s government also passed the National Bank Act of 1863, supplemented by the National Bank Act of 1864. Originally known as the National Currency Act, its stated purpose was to stabilize the banking system by eradicating the problem of notes issued by multiple banks circulating at the same time. A single banker-issued national currency was created through chartered national banks, which could issue notes backed by the U.S. Treasury in a quantity proportional to the bank’s level of capital (cash and federal bonds) deposited with the Comptroller of the Currency.

From Roosevelt’s Reconstruction Finance Corporation (1932-57) to HR 6422

The American president dealing with an economic situation most closely resembling that today, however, was Franklin D. Roosevelt. America’s 32nd president resolved massive unemployment and infrastructure problems by greatly expanding the Reconstruction Finance Corporation (RFC) set up by his predecessor Herbert Hoover. The RFC was a remarkable publicly-owned credit machine that allowed the government to finance the New Deal and World War II without turning to Congress or the taxpayers for appropriations. The RFC was not called an infrastructure bank and was not even a bank, but it served the same basic functions. It was continually enlarged and modified by Pres. Roosevelt to meet the crisis of the times until it became America’s largest corporation and the world’s largest financial organization. Its semi-independent status let it work quickly, allowing New Deal agencies to be financed as the need arose. According to Encyclopedia.com:

[T]he RFC—by far the most influential of New Deal agencies—was an institution designed to save capitalism from the ravages of the Great Depression. Through the RFC, Roosevelt and the New Deal handed over $10 billion to tens of thousands of private businesses, keeping them afloat when they would otherwise have gone under ….

A similar arrangement could save local economies from the ravages of the global shutdowns today.

The Banking Acts of 1932 provided the RFC with capital stock of $500 million and the authority to extend credit up to $1.5 billion (subsequently increased several times). The initial capital came from a stock sale to the U.S. Treasury. With those modest resources, from 1932 to 1957 the RFC loaned or invested more than $40 billion. A small part of this came from its initial capitalization. The rest was financed with bonds sold to the Treasury, some of which were then sold to the public. The RFC ended up borrowing a total of $51.3 billion from the Treasury and $3.1 billion from the public.

Thus the Treasury was the lender, not the borrower, in this arrangement. As the self-funding loans were repaid, so were the bonds that were sold to the Treasury, leaving the RFC with a net profit. The RFC was the lender for thousands of infrastructure and small business projects that revitalized the economy, and these loans produced a total net income of over $690 million on the RFC’s “normal” lending functions (omitting such things as extraordinary grants for wartime). The RFC financed roads, bridges, dams, post offices, universities, electrical power, mortgages, farms, and much more–all while generating income for the government.

HR 6422 proposes to mimic this feat. The National Infrastructure Bank of 2020 can rebuild crumbling infrastructure across America, pushing up long-term growth, not only without driving up taxes or the federal debt, but without hyperinflating the money supply or generating financial asset bubbles. The NIB has growing support across the country from labor leaders, elected officials, and grassroots organizations. It can generate real wealth in the form of upgraded infrastructure and increased employment as well as federal and local taxes and GDP, paying for itself several times over without additional outlays from the federal government. With official unemployment at nearly double what it was a year ago and an economic crisis unlike the U.S. has seen in nearly a century, the NIB can trigger the sort of “economic miracle” the country desperately needs.

This article was first posted on ScheerPost.

The post Tackling the Infrastructure and Unemployment Crises: The “American System” Solution first appeared on Dissident Voice.

No Work, Little Work, Too Much Work, UBI/DIY/Gig Economies

It’s an unprecedented coalition of business networks that have come together to raise our ambition. Not just to help our individual CEOs succeed, we’ll do that for sure. But to actually bring their voices together to help shift culture. So that the pushback on the BRT [Business Roundtable] from different business publications or other people within the business community lessens. So there’s less of a headwind culturally for this type of leadership. 
— Jay Coen Gilbert, co-founder of B Lab and B Corporations [Source]

[These are not good people, and if anyone thinks otherwise, then, well, War is Peace, Truth is Lies, Hate is Love!]

We Are Big Data’s Dregs

The great data dredge. Everyone’s hired through a digital head hunter, staffing firm, and the result is a continuation of atomizing society with no water cooler, so to speak, from which to complain about working conditions, to discuss the next austerity measure concocted by the boss/management/ CEO/Corporation. No after work bull session at the local Chili’s or T.G.I.F. to compare notes about those exploding gas tanks and caustic chemicals and faulty electrodes in the air bag systems.

This is what Ford would have wanted, and this is what the heads of retail and data and manufacturing want. They’ve already put most of us over a barrel with forced arbitration clauses, non-compete agreements (sic), and rule after penalty after threat after law after delimitation, that, well, in this knowledge (sic) economy and post-Industrial (sic) economy, the white collar and pink collar workers are hemmed in by management. More than the field hands picking this country’s lettuce!

The hemming in is an oppression planned and sealed, and a deep seated zombifcation of the “higher castes” and to be honest, people of the land, even those in struggle, in other countries that have been deemed shit-holes by Trump and Third World by Biden have more gumption about them, more ability to fight the systems, the oppressors, than any member of the Western Civilization.

Just drive around your town or suburb, anywhere. Take a look at what and how the systems have been set up for and about the rich, for the money changers, for the money takers, for the dream hoarders. Take a look. How many bus stations, how many covered and art-imbued public amenities? How many public toilets, public waysides, public paths, public trails, public pedestrian overpasses, public bandstands, public gazebos, public museums, public eateries, public statues, signs, art, historical markers? How many trees and shrubs and open spaces set up for the public? How many picnic tables and interpretive trails, and …? How many tiny home villages for the houseless? How many community gardens? Theaters and cinemas for and by the people?

Talk about dead and lobotomized citizens, as we have allowed the captains of industry and oppressors of finance and the legions of pushers of the realm rule: retailers, consumer crack salesmen/women, middle managers, ant hill after ant hill of processors and facilitators of the entire house of cards built upon the dopamine hits of lizard drips of the brain. “I betcha can’t eat just one Lays potato chip,” now on steroids – “I betcha you can’t just have 3 big screen TVs in your pad … “And now you fill in that blank – Just look at the so-called Black Friday ads.

Amazing, junk, junk and more junk. Families buying deep fryers and rice steamers and any number of electronic junk that they can’t or don’t know how to use. All that plastic and tin, diodes and LED screens. All of that planned obsolescence. Nary a word about the embedded energy, the packaging, the toil and slave labor, the life cycle analysis. Piles and piles of worthless junk, planned to break, parts planned to snap, wires planned and ready to melt.

Planned Human Obsolescence

This is not a difficult thing to comprehend,  about socialism for the land and people versus capitalism for the elite and bankers and small group of sociopaths, who will fight tooth and nail (well, with a battalion of lawyers at $1500 an hour each, not really a fight per se) to push the poisons, hawk the faulty products, demand the welfare for the rich and corporations, and deposit all the externalities of their profit schemes onto the public and the commons’ health.

But …  Man, those “buts.” I talk all the time with great white saviors, who just start spewing at the mouth of the evils of socialism, and that, well, capitalism is good, and “we let Jeff Bezos and Elon Musk and Bill Gates and Mark Zuckerberg” accumulate so much wealth and power, so it’s our fault, and really, is it that bad we have these Titans who give us goods and services? This is like heaven compared to countries who push that bullshit democratic socialism crap. Do you know what the 10 pillars of socialism/communism/Marxism are?”

Try putting “debunking the critics of socialism” into the Google Gulag Search, and you shall receive so much hatred and polemics around anything tied to socialism on the first 50 pages of the search, that, well, you get the picture why these big white saviors will dare  come up to me and challenge me the socialist on how and why socialism is bad-bad-bad while capitalism is god’s work.

As these great white saviors are pushing a cart filled with two TV’s, a new printer, two iPads, and junk junk junk, 50 pounds of kitty liter and a hundred pounds of dog chow. While walking past the two young men I am working with who are taking in shopping carts as part of their competitive work as people who happen to be living with Intellectual and Developmental Disabilities. These Great White Hopes are Blind to “them.”

These great white saviors, well, it’s all about survival of the fittest. All about the colonized mind. All about – “you majored in the wrong subject matter, sucker … born into the most messed up family, sucker grew up on that side of the railroad tracks, dufus … got stuck with those bills and foreclosures, sucker.”

Oh, the invisible hand of the oppressors, and these people – Biden and Trump supporters, what have you – are criminal thinkers, really, because with one huge swath of their inhuman brain, they disregard 90 percent of the planet’s people.

“They are all sucka’s for being born where they are and from the loins of ‘those’ rotten people.”

A Sucker Borne Every Nanosecond

Oh, and I am seeing more and more quasi-leftist stuff, saying, well, the left needs to embrace the Trumpies, to work with them on labor rights, on environmental rights, on health care for all, on all those issues, and not be so hung up on their misogyny, racism, classism, white Duck Dynasty Ted Nugent shit.

Insanity, man. Leftists writing from the comfort of their offices, well, they are a dime a dozen. The reality on the ground is that this country has a cool 100 million or so hateful, resentful, ignorant of the world, pro-war, rah-rah, hate welfare of all kinds sort of people. They don’t have to be Proud Boys and KKK. These people in this USA, the white ones, mostly, have come from that evil spawn stock, back even before SCD, Smith Colony Disease.

Then, again, we have Democrats with a wilted big “D” who need their comeuppance, and who are just one half brain shy of a squid, and somehow, the other squids (sorry about the dispersion to cephalopods) with another load of brain cells missing need to be embraced, because, the GOP and Trumpies and the like want to move toward a truly socialist society?

Again, the reality is some bad-ass slow, consistent and in many cases rapid death by a 1,000 capitalist cuts.

I meet people in my new job, working with Adults with ID/DD, to get job ready and jobs in the community – real jobs, not stuck in some sheltered workshop getting one-tenth the wage of anyone else in the same job.

Sure, I am doing great work, god’s work, the work of an angel (they really say this stuff to me, a commie, a devoted atheist), and while I get the gist of that, we talk about how it is my careers have been shit for pay, highly exploitive and yet highly regarded in some sense: teaching, social services, and, well, community journalism.

“Ha-ha, you are doing these great services knowing you are not going to get rich doing it, but thank you for your service.”

Imagine that stupidity, that dense mentality. Imagine, the hard jobs that need doing in a broken capitalist society with wave after wave of damaged, chronically ill, economically strafed, mentally poisoned, generously precarious, and one paycheck away from bad ass disaster citizens on the precipice? PayDay Loans? That in and of itself defines capitalism. The Mafiosi aspect of this spiritually deserted society.

Yet, now, these great leftist warriors are saying the Trumpies and the GOP of the world – the log cutters, the mill workers, the truckers, the blue collar millionaires – that they want workplace rights, the right to strike, the right to squat, the right to refuse bad and dangerous work; that they want to be able to shut down polluting industries, and the right of the people to take over industries? That these Trumpies and GOP want universal health care, universal rights for all people. That these GOP and Trumpies want real education, more education, holistic education, writing and thinking across the curriculum, across disciplines, across industries. That the GOP-Trumpies will work so-so well with organizers and “the people” over defunding and holding to task “the police-backed” banks-warehouses-fulfillment centers. Right!@#$%

So how does anyone on both sides of the manure pile called USA politics square this fact?

Ahh, the world’s 26 richest people currently have the same amount of wealth as the poorest 3.8 billion—down from 61 people in 2016. As the rich get richer, sea levels are rising, tribalism is flourishing, and liberal democracies are regressing. Even some of the wealthiest nations are plagued by job insecurity, debt, and stagnant wages. Ordinary people across the political spectrum are increasingly concerned that the system is rigged against them. Trust in public institutions is near an all-time low.

So that Google search got one hit on the “other side” of the dividing line (not really) – “What the Right Gets Wrong About Socialism. As Scandinavia shows, it does feature plenty of public ownership—but also a thriving economy.”1

Sure, we get this from the Norwegian:

Norway’s success has not come without costs—wealth accrued through oil and other extractive industries has had harsh ecological consequences. But students there and across Scandinavia graduate without the horrifying debt burdens of their U.S. counterparts. Those who sustain injuries in traffic accidents never have to beg bystanders not to call for an ambulance, for fear of drowning in medical debt. Norwegian diabetics don’t need to crowdsource their insulin. As seniors, they don’t spend their golden years working at Walmart or living in their vehicles. Their homes were not repossessed en masse by banks during the Great Recession. Extensive public ownership shields Norwegians from the harshest aspects of unfettered capitalism.

But then he attacks North Korea and Venezuela for being failing socialist countries, and without the context of the international transnational monetary criminal system of sanctions and debt and theft of Venezuela’s treasury, and war war war with Korea still on the hot plate. Then the illegal maneuvers of governments like the USA and supported by all those others, including Norway, in its attack on Venezuela’s elected leaders and support of the dirty rich racist opposition groups, that is not mentioned.

Yep, there is a link in the Norwegian’s piece to another article – July 2018, “There is Nothing Inherently Wrong with State Ownership” by Matthew Bruenig over at Current Affairs Magazine.

Again, short anemic, and an essay in response to an attack on Norway and Sweden and “socialist” countries in the Nordic category by a New York Times “writer,” a Bret Stephens, who is sloppy and makes untrue claims in this piece, “Democratic Socialism Is Dem Doom.”

No Richard Wolf and no Michael Parenti or any thousands upon thousands of thinkers who know about societies and economies and cultures and ecologies who could put this tripe to rest. This is it?

Hemming Us In

Imagine, a 69-year-old working in a deli at a national chain. “I was once a speech therapist with a thriving private practice. And then my retirement went bust, thanks to Enron.” So, Molly works with a terrible limp, arthritis everywhere and almost no hair left. Fryers, slicers, prepping, and she runs it. Since age 55, when not only her measly retirement went bust, but the speech therapy arena turned more and more into high end certification racket, and gobbled up by, well, monopolies, agencies that scarf up the independents, or make it impossible to compete against the aggregators and services felons.

Then another guy, James, working the parking lot, bathrooms, carts, etc., making a wage when he started at this national grocery chain, of $9.75 an hour. He busts his butt, and we talked about his chronic heart failure, the meds he takes each month, all of that, including the pace maker and other aspects of his life, at age 60. He is at $12 an hour after five years with this outfit, and he tells me his supervisor likes his work, and his helping the other cart people, so much so that he is in for a wage increase to $15 an hour. He has to wait 90 days for the higher ups to approve that.

Hemming in. Working hard jobs at an old age to keep bad health insurance that is part of a for-triple-profit system of penury and theft. Oh, stories of an item being charged 18 times more during this Covid “crisis.”

A study that revealed hospitals may be charging as much as 18 times over their costs.

Nurse Jean Ross – “ Yes. Again, unconscionable, but that seems to be the way in this country. Up to 18 times. So, for example, if your true cost — it’s called the charge-to-cost ratio, or CCR — if your true cost for your service is $100, they are, in many cases, charging up to $1,800. And they do it because they can.” This from a study put out by National Nurses United.

Sit on the Ground and Try and Pull Yourself Up by Bootstraps

Those great white hopes, those big happy white males and big happy white females who voted for Trump and then those that believe Biden is better, well, that’s what we have – “Just let it take place, and that’s the way the Capitalist Cookie crumbles. What would Cuba be doing? The great invisible hand will fix things!”

Where I currently work – a small non-profit – the amount of software and tracking-time management apps and all the government agencies I have to get my mandatory trainings on and get my certifications renewed, well, it’s almost daunting. That’s the squeeze, the money train to the middle men, having nothing to do with my job, my humanity, work.

This is a non-for-profit agency working with adults with ID/DD.

Imagine all those warehouses and factories and office buildings and other places where the atomization was already on overdrive before the plan-pandemic.

Now, with the lockdowns, the on-line doom dungeons, and alas, with more and more AI and IT measures in place to keep us out of each other’s social distance arena, things are really degrading big time.

Teaching to the New Technology

I want to look at another gig I had – substitute teaching. Not just the bad working conditions of the public schools and anxious teachers and idiotic principals and the dictatorial superintendent. Let’s look at the payrate. Look at this – substitute teachers, K12, in Oregon, on the Coast, now managed by a Tennessee outfit. Note the hourly rate, and of course, coming into substitute teaching, a teaching certificate is required, and that means, well, most teachers like me, we have master’s degrees. That Oregon licensing costs another cool $400 to get the license and jump through the hoops. We get no mileage expended to get to and from very remote schools.

Job details — $14 an hour; Full-time/ Part-time; The State of Oregon requires all substitute teachers to hold an active Oregon Teaching License, Restricted Substitute Teaching License, or an Oregon Reciprocal License.  As leaders in the education staffing space since 2000, ESS specializes in placing qualified staff in daily, long-term, and permanent K-12 school district positions including substitute teachers, school aides, and other school support staff. With more than 700 school district partners throughout the US, ESS supports the education of more than 2.5 million students every day.

I had been teaching as a substitute a year ago. I had been hired by the District, and my contacts were through the District. I was making $80 for four hours and $160 for seven. In many cases I could get called in late and then get ready, make the drive in the rural county, get to the school and still  get the full day’s pay rate. That’s more than $18 an hour, and alas, I got to know the teachers who wanted me when they had planned absences, and the school secretaries also knew me.

There is a shortage of substitutes, and, well, if things were better all around, substitutes could be integrated more seamlessly and holistically to provide amazing outside the box perspectives and teaching.

Not so in Lincoln County, as is true of most counties, with plenty of Administrators, plenty of bullshit curriculum cops, plenty of teach-to-the- test zombies running roughshod over the entire project of working with our youth, our kids, our aspiring young adults.

This staffing “solution” is killing again teachers getting together, working with the district, getting to know people in the district, airing grievances with the district. Everything goes through this Tennessee outfit. Complaints go nowhere, and if you get a complaint leveled against you by a school, ESS will NOT go to bat. They have taken that $18 an hour and whittled it to $14 an hour. Then, they probably charge more than just that $4 per each hour taught to the DIstrict. Add to the fact they will manage who gets called, how they get called. These people are running call centers, data dredging centers, and know zilch about the schools, the roads, the weather, the culture, the teachers, the students.

I am sure they will not be allowing teachers to get a few extra hours pay if they are called in late and end up working a partial day. I am sure there are all sorts of cost-cutting (human-killing measures) this Education Staffing Solutions outfit deploys.

And, they probably pay Google for a net cast to see how many hits on the world wide web Education Staffing Solutions gets mentioned or Yelped or rated on Indeed or Linked In. You can only imagine if I was still employed as a substitute teacher, through ESS, that conversation happening, as ESS would be the outfit that would be managing me, so to speak. Finding this article criticizing them, well, sayonara subbing Mister Paul Haeder.

Management fees, man, and government (local, city, county and state, and federal) giving up oversight and decent livable wages for all the agencies and the public utilities (that we could have) and everything else, gone to middle and middle and middle men.

Again, these warped folk with ESS probably backed Trump and believe in Capitalism on Steroids, while they make bank on all the public entities across the land, AKA, public schools.

That the bus systems for schools is now outsourced from sea to shining sea, that again, defines the bottom line of pathetic capitalism. All the food cooked in cafeterias, outsourced to Sodexo. There is nothing local anymore, and these multinationals, these huge stockholder and stock board run outfits, they are making money off of us, US taxpayer, and in that formula, they are welfare recipients, and mostly welfare cheats, and with ESS, they are ripping off the very people that do the work – teachers, para-educators, more.

My comeuppance it seems was being banned from the entire District because of a few students I was in charge of at a local high school accused me of “upsetting” them when we were having a classroom discussion about homelessness, about epigenetics and families, about poverty, about the potential for many people to become substance abusers. We were talking about the books Of Mice and Men and Animal Farm.

What happened was La-La-Land level stuff, and while I think some students are crackpots, and little versions of really bad parents, I am ready to deal with crackpots and talk them off their cliff.

I did not get my day in court, so to speak, and I was not allowed to explain what could have been the students’ (three of them) hysteria, and I had no chance to query the people involved or bringing in the rest of the classroom students who were both inquisitive and enthralled to have a well-traveled, well-read, well-educated, well-experienced person like me in their classroom, albeit, temporary.

And ESS did nothing to defend me, protect me, or gain some sort of redress. That was a year ago.

Here’s a positive story — “Musings on a Monday After Teaching High School Get You Down? Nope!”

Another — “Professor Pablo and Fourth Grade Enlightenment in Lincoln City”

Education By and Because of the Corporation

The backdrop of my teaching debut … was a predicament without any possible solution, a deadly brew compounded from twelve hundred black teenagers penned inside a gloomy brick pile for six hours a day, with a white guard staff misnamed ‘faculty’ manning the light towers and machine-gun posts. This faculty was charged with dribbling out something called ‘curriculum’ to inmates, a gruel so thin [that this school] might rather have been a home for the feeble-minded than a place of education.
— John Taylor Gatto, “The Underground History of American Education,”

I did get a bird’s eye and on-the-ground look at the elementary, middle and high schools in this District. I have done substituting elsewhere, as in Vancouver, Seattle, Spokane and El Paso. Things are not looking good for youth. And I have written about that fact decades ago, and, yes, way before COronaVIrusDisease-2019, and, now, in a time of stupidity, fear, self-loathing, and complete loss of agency, the world is flipped around and, in most cases, crushed for our young people.

Did I mention fear, and while this Intercept piece below is a superficial look at the digital divide, there is so-so much more to write about this lockdown and social (pariah) distancing. It is a caste system on steroids. Calling it “remote learning” is doublespeak, oxymoronic.

In agro-industrial Watsonville, California, English-language learners struggle with remote learning. It’s much easier for students in a nearby Bay Area suburb.

I have a daughter, a step-daughter and a niece in various schooling situations. One is in med school, one is getting a chemistry degree and one is in esthetician school. Hmm, you’d expect hands-on for med school and chemistry majors. Nope. The fear factor for one of the three young women is high, and she is not wanting to leave campus, and the great reset is not in her vocabulary. There is a bombastic, “I am so glad Trump is gone. I hate him. I wish he was dead” from one of the college students. But that’s about it.

The med school woman, well, she is still having to pay out the nose for the school, yet there are less hands-on classes, again, through this doublespeak system of “remote learning.”

Now the esthetician student is hands-on, learning about the human skin dynamics, the chemistry of things in the body and outside, and working on clients, hands on. Seems very interesting that this one area – not to knock one career choice over another – has more practical hands on work than university-level chemistry majors and medical school attendees.

Now, the chemistry major’s school is introducing an “app of paranoia and tracking 101” – you put it on your smart phone, and all those who accept this app, well, as soon as someone tests (sic) positive for the virus (sic), then the entire network of users will get a notification and a detailed map of that person’s whereabouts. Oh, it’s secure, safe, no personal data shared (or mined – right!) they say, and that is a blatant lie-lie-lie. This is the Great Reset, and it’s pathetic and a gateway drug to implanted RFID’s.

The two college students, well, they are focused on their majors, but because of the siloing (atomization) of schooling, the demands on S/T/E/M do not enter the real of STEAM, science technology engineering arts math as  interdisciplinary critical studies and as a praxis of seeing how the world could, should and might work outside the Corporate Thievery of Capitalism.

The net effect of holding children in confinement for twelve years without honor paid to the spirit is a compelling demonstration that the State considers the Western spiritual tradition dangerous, subversive. And of course it is. School is about creating loyalty to certain goals and habits, a vision of life, support for a class structure, an intricate system of human relationships cleverly designed to manufacture the continuous low level of discontent upon which mass production and finance rely.” —John Taylor Gatto, The Underground History of American Education

More atomization, and more dumb-downing, and more caste systems, and more social-economic-intellectual-employment-philosophical-cultural distancing. This is it for us, no?

 …. the world’s 26 richest people currently have the same amount of wealth as the poorest 3.8 billion—down from 61 people in 2016. As the rich get richer, sea levels are rising, tribalism is flourishing, and liberal democracies are regressing. Even some of the wealthiest nations are plagued by job insecurity, debt, and stagnant wages. Ordinary people across the political spectrum are increasingly concerned that the system is rigged against them. Trust in public institutions is near an all-time low.” [source]

Read some of this report, and the surface stuff, well, just surface feel good stuff, but dig deep — Oxfam Report. It’s harrowing.

Nick Hanauer, entrepreneur and venture capitalist:
I am a practitioner of capitalism. I have started or funded 37 companies and was the first outside investor in Amazon. The most important lesson I have learned from these decades of experience with market capitalism is that morality and justice are the fundamental prerequisites for prosperity and economic growth. Greed is not good.

The problem is that almost every authority figure – from economists to politicians to the media – tells us otherwise. Our current crisis of inequality is the direct result of this moral failure. This exclusive, highly unequal society based on extreme wealth for the few may seem sturdy and inevitable right now, but eventually it will collapse. Eventually the pitchforks will come out, and the ensuing chaos will not benefit anyone – not wealthy people like me, and not the poorest people who have already been left behind.

Ironically, the woman going into the beauty field is much more keenly aware of the economic and social disasters befalling small businesses in her own city, her own state and her region of the country.  She is super left, but is keenly aware of her democratic governor’s insipid lockdown measures.

I have many friends who now are going bankrupt, closing their businesses. Those businesses are part of a multiplier fabric. The town is or was so much better off with all these independent and mom and pop owned businesses. Not just the cool eateries and breweries, but many people I know opened up furniture stores, businesses around building and construction, all kinds of services you can’t find at the national level. Heck, used computer parts and computers, and even car rental places. Things that are not part of the monopolizing Fortune 500 set. Gone.

That means, of course, STEAM is damaged, in that, sure, the arts are hit hard, but the rest of the STEM also are hit hard on many levels. These STEM folk like their food, beer, edgy stuff, locally sourced and owned. The neutron bomb  that the lockdowns and lack of financing and wages and deep-deep help for the small guys and gals, well, it is hollowing out and even more hollowed out economy. The STEM folk will follow the money, while the arts folk and those deeply tied to something richer than science for profit and engineering for war and math for building and construction and technology for the Fourth Industrial Revolution will embed and grow a city’s or town’s or area’s culture.

This all leads us back to the semi-liberal class, even the youth who hate Trump and who don’t get all the conspiracies because they go to schools (universities) which are nothing to shake a stick at, since they are tied to social constructs and hierarchies reliant on the investor class; and they pay out the nose, take out loans and go to classes that are on-line, given to them now largely by scared educators, monitored and mashed up by the Titans of Technology, who have colonized every aspect of our society, ESPECIALLY, PK12 and higher education.

The young woman working on beautifying people and supporting their self-esteem and confidence on a superficial level (skin deep beauty, so to speak), well, she is more acutely aware of the lies of the authorities on both sides of the political manure pile than these card-carrying creeps who actually think Kamala Harris is something good. Anyone-but-Trump is what got us here, this evil of two lesser, lesser of two evils. The two college-going/educated ones are more and more tied into getting out and making money, and not to knock them, because they too know the disgusting reality of poverty and more and more people who once had decent lives, who were the fabric of communities, from that baker to the speech therapist, from that teacher to the counselor, from that glass blower to that coffee shop owner, from all those service workers with lives outside just the service economy (if they are budding or bustling artists).

The creative class is not what Richard Florida yammers about. The liberal class, as Chris Hedges writes, is dead. Education has been gutted and sold down the river, as Henry Giroux states. The New Jim Crow, as Michelle Alexander states, is the new normal for not just American mindsets at the citizen level, but on the economic and investor and Capitalist level.

But conditions today favor the amateur. They favor “speed, brevity, and repetition; novelty but also recognizability.” Artists no longer have the time nor the space to “cultivate an inner stillness or focus”; no time for the “slow build.” Creators need to cater to the market’s demand for constant and immediate engagement, for “flexibility, versatility, and extroversion.” As a result, “irony, complexity, and subtlety are out; the game is won by the brief, the bright, the loud, and the easily grasped.”  — “The Great Unread: On William Deresiewicz’s The Death of the Artist

Capitalism is fascism, and it takes over entire cities and states and regions. It operates on the “buyer beware” mentality, which relies on consumers to take it up the rear, no foul called on the billionaires and CEOs and capitalist systems;  and it is protected through the fascist laws of the land created by the massagers of the law from the Supreme Court down to traffic court.

More Nazis Than They Knew What to do With

Again, the great reset tied to Dashboards, a million different types of Education Staffing Solutions (ESS), universal buffoon incomes, all of that inculcated by Karl Schwab, Bill Gates, the Aspen Institute, the TED-X-ers, the World Economic Forum, all of them in the elite class, their handlers, their sycophants, all of those billionaires determining the course of cradle to grave predetermination for billions of people (Zuckerberg has encircled the African continent with his cables and lines and  fiber optics), that reset was started decades ago. Debt. Foreclosures. Bailing out corporations. Drugs for guns; Crack Cocaine and the CIA; and, well, the CIA is god, into everything, right, making sure the reset has already been ensured. CIA and Nazis, and Mossad and Jihad, and, these are the merry makers of the world of Lords of War, Lords of Disruptive Economies, Lords of Predatory-Parasitic-Vulture-Usury Capitalism.

Operation Paperclip – 1,600 of Hitler’s Angels of Death. Housing, citizenship, and carte blanc living in the United States. Families welcomed. Italy’s and Germany’s intelligent agencies working closely with the National Security State, and this was in the form of so-called the rat-lines. Tens of thousands going to South America. Tens thousand other Nazi’s allowed to come to USA.

And this was the plan, from the last days right before WWII ended with an illegal double bang of Atomic Murdering Tools – all these stay-behind armies from those defeated fascists of Italy and Germany. Check out this interview on RT –Chris Hedges talks to Gabriel Rockhill about the undercurrents of fascism in America’s DNA, and the US role in internationalizing fascism after World War II through clandestine activities such Operation Paperclip and Operation Gladio.

Rockhill is a Franco-American philosopher and the founding Director of the Critical Theory Workshop and Professor of Philosophy at Villanova University. His books include Counter-History of the Present: Untimely Interrogations into Globalization, Technology, Democracy, Interventions in Contemporary Thought: History, Politics, Aesthetics, Radical History & the Politics of Art and Logique de l’histoire.

Try having conversations with liberal (illiberal) college-educated and college-loving Democrats about USA’s bioweapons program dating back to again, WWII, and Japanese scientists who were working on all sorts of bioweapons but were captured by the USA and reappropriated and brought back to the USA for, well, good paying jobs.

That is capitalism, right, reappropriating and stealing and setting up systems of mental, physical, psychological, biological, ecological, cultural repression, and eventually, disease and illness, because it pays more to treat and encourage the disease than it does to have a society living disease-free or at least living with those old time religion concepts of – precautionary principle, do no harm, preventative medicine, treat your fellow human as you would want to be treated. You know, all of that mumbo-jumbo that is not put into practice one iota in Capitalism, but certainly is mishmashed into the systems of propaganda, and, alas the “Si Se Puede” marketing of such criminals at Audacity of Hope Obama. et al makes some feel like there is change where change will NEVER be.

Until we get this liberal archetype  who says Columbus was a bad guy, and that the USA was built upon the deaths and murders of Indians and Blacks, but, shoot, when ordering from the Prime Amazon account, or when scrolling up and down the iPhone, and, well, all of that which we take for granted in this First World which comes on the back of people here and now in this country and especially in other countries, then, well, the tune changes.

Fascism: Artificial Intelligence, Virtual Reality, Augmented Reality

Because in an economic fascism, when again, old worn out people have to still hoof it to Walmart and stock shelves, and when there is no home health care for the sick and dying, young or old, unless there is always huge exchanges of money going out into the pockets of the purveyors of capitalism, you will be getting variations on a theme of a people hooked on Netflix, hooked on buying, hooked on not knowing, hooked on confusion and chaos and, well, this is what is planned.

The great reset and fourth industrial revolution are no-brainers. We’ve given up our fingerprints for a shit job, we have given up blood and urine for a shit job, we are guilty before we can attempt to prove our humanity, our innocence, and in reality, we are always guilty in the eyes of Capitalists.

Western and ruling class ideologies have played a crucial and cruel role in the violent transformation of the peoples, ecosystems and biosphere. The Fourth Industrial Revolution represents the most violent transformation of all. For as long as the ruling class is allowed to exist, social and environmental justice remain pipe dreams. [Cory Morningstar, source]

We are now taking those supposedly benign things like tracking outcomes – you know, if you have prenatal education and vitamins as a pregnant teen, and if you get the little tikes reading on a Chromebook, watching Sesame Street and if you eat this veggie over that deep friend morsel, and, all of those metrics that the data ditzes love, all of it is now being used AGAINST self-agency, AGAINST not just individuals, but all manner of classes, groupings, economic strata. You do the stuff “right” which Bill and Melinda have studied are right, then there will be s few more digital dollars in your bank account. If you fail to do them, well, no more dialing for dollars.

Because the jobs are going. The mom and pops are folding. Even chains like bowling alleys and movie theaters, all of that, they are shuttering. This revolution was already in the works before Marshall McLuhan and the medium is the message and Herman and Chomsky’s manufacturing consent. Way before deadly at any speed, a la Nader, and way before the lies of better angels of our nature Pinker.

The fix was in long-long time ago, when the food was locked up and the agricultural revolution forced us to stop being human and humane, and made us into the cogs in so many machines of oppression and suppression.

Until today, when the Catholic freaks are coming in their vestments with their exorcising tools for anyone who would dare desecrate the statue of Columbus or any Fray who pushed their stinking selves and their stinking religions onto this continent and the one south.

In response to Indigenous-led efforts that demanded land back and the toppling of statues, Catholic Church leaders in Oregon and California deemed it necessary to perform exorcisms, thereby casting Indigenous protest as demonic. [Truthout]

LaRazaUnida cover the Fray Junípero Serra Statue in protest at the Brand Park Memory Garden across from the San Fernando Mission in San Fernando on June 28, 2020.

Exorcism: Increasingly frequent, including after US protests

This is 2020, and the trillionaire Catholic Church is walking in downtown Portland with these conquistadors of nothingness, while the great reset is happening, with the green light of the Pope. “The story did not end the way it was meant to,” Pope Francis wrote recently, deftly excommunicating about a half-century’s worth of economic ideology.  [source] In a striking, 43,000-word-long encyclical published last Sunday, the pope put his stamp on efforts to shape what’s been termed a Great Reset of the global economy in response to the devastation of COVID-19.”

Here it is imperative to note the consolidation of power happening in real time. World Economic Forum founder and CEO Klaus Schwab refers to this consolidation as a new global architecture; the new global governance. The following dates of are of paramount significance. On May 18, 2018, the World Bank partners with the United Nations. On June 13, 2019, the World Economic Forum partners with the United Nations. On March 11, 2020, the World Economic Forum partners with the World Health Organization (a UN body) launching the COVID Action Platform, a coalition of 200 of the world’s most powerful corporations. This number would quickly swell to over 700. On this same day, March 11, 2020, the WHO declares COVID-19 a pandemic. The UN-WEF partnership firmly positions Word Economic Forum at the helm of the Sustainable Development Goals (SDGs, also referred to as the Global Goals), which they are frothing at the mouth to implement. This is not because they care about poverty, biodiversity, the climate, or world hunger. Marketed with holistic language, dressed with beautiful images of brown smiling children, SDGs represent the new poverty economy (impact investing/social impact bonds) and emerging markets. Children as human capital data to be commodified on blockchain linking behaviour to benefits. Coercion has been repackaged as empowerment. The human population to be controlled via digital identity systems tied to cashless benefit payments within the context of a militarized 5G, IoT, and an augmented reality environment. A world where every function of nature is monetized, to be bought, sold and traded on Wall Street. — Cory Morningstar, The Great Reset: The Final Assault on the Living Planet [It’s not a social dilemma — it’s the calculated destruction of the social — Part III]

Pope Francis meets with members of the clergy after his weekly general audience at the San Damaso courtyard, at the Vatican, September 30 2020. REUTERS/Yara Nardi - RC2X8J96HY8F
[Pope Francis meets with members of the clergy after his weekly general audience at the San Damaso courtyard, September 30 2020. Image: REUTERS/Yara Nardi]
  1. Erlend Kvitrug, June 29, 2019 at Foreign Policy Magazine.

The post No Work, Little Work, Too Much Work, UBI/DIY/Gig Economies first appeared on Dissident Voice.

Why the Fed Needs Public Banks

The Fed’s policy tools – interest rate manipulation, quantitative easing, and “Special Purpose Vehicles” – have all failed to revive local economies suffering from government-mandated shutdowns. The Fed must rely on private banks to inject credit into Main Street, and private banks are currently unable or unwilling to do it. The tools the Fed actually needs are public banks, which could and would do the job.

On November 20, US Treasury Secretary Steven Mnuchin informed Federal Reserve Chairman Jerome Powell that he would not extend five of the Special Purpose Vehicles (SPVs) set up last spring to bail out bondholders, and that he wanted the $455 billion in taxpayer money back that the Treasury had sent to the Fed to capitalize these SPVs. The next day, Powell replied that he thought it was too soon – the SPVs still served a purpose – but he agreed to return the funds. Both had good grounds for their moves, but as Wolf Richter wrote on WolfStreet.com, “You’d think something earth-​shattering happened based on the media hullabaloo that ensued.”

Richter noted that the expiration date on the SPVs had already been extended; that their purpose was “to bail out and enrich bondholders, particularly junk-bond holders and speculators with huge leveraged bets”; and that their use had been “minuscule by Fed standards.” They had done their job, which was mostly to be “a jawboning tool to inflate asset prices.” Investors and speculators, confident that the Fed had their backs, had “created wondrous credit markets that are now frothing at the mouth,” making the bond speculators quite rich. However, in Mnuchin’s own words, “The people that really need support right now are not the rich corporations, it is the small businesses, it’s the people who are unemployed.” So why aren’t they getting the support? According to Richter:

Powell himself has been badgering Congress for months to provide more fiscal support to small businesses and other entities because the Fed was not well suited to do so, which was the reason the Main Street Lending Program (MSLP) never really got off the ground.

The reason the Fed is not well suited to the task is that it is not allowed to make loans directly to Main Street businesses. It must rely on banks to do it, and private banks are currently unable or unwilling to make those loans as needed. But publicly-owned banks would. Fortunately, Several promising public bank bills were recently introduced in Congress that could help resolve this crisis.

The reason the Fed is not well suited to the task is that it is not allowed to make loans directly to Main Street businesses. It must rely on banks to do it, and private banks are currently unable or unwilling to make those loans as needed. But publicly-owned banks would. Fortunately, Several promising public bank bills were recently introduced in Congress that could help resolve this crisis.

But first, a look at why the Fed’s own efforts have failed.

The Fed Lacks the Tools to Inject Liquidity into the Real Economy

Congress has charged the Federal Reserve with a dual mandate: to maintain the stability of the currency (prevent inflation or deflation) and maintain full employment.  Not only are we a long way from full employment, but the stability of the currency is in question, although economists disagree on whether we are headed for massive inflation or crippling deflation. Food prices and other at-home costs are up; but away-from-home costs (gas, flights, hotels, entertainment, office apparel) are down. Food prices are up not because of “too much money chasing too few goods” (demand/pull inflation) but because of supply and production problems (cost/push inflation). In terms of “output,” we are definitely looking at deflation. An August 2020 Bloomberg article quotes economist Lacy Hunt:

[A]ccording to the figures of the Congressional Budget Office, the output gap will be a record this year and we will have a deflationary gap. In other words, potential GDP will be well above real GDP. And according to the CBO, we’re going to have a deflationary output gap through 2030.

The Fed’s monetary policies, it seems, are not working. On November 11 and 12, according to Reuters:

[T]he world’s top central bankers … tune[d] into the European Central Bank’s annual policy symposium … to figure out why monetary policy is not working as it used to and what new role they must play in a changed world – be it fighting inequality or climate change.

… Central banks’ failure to achieve their targets is beginning to challenge a key tenet of monetary theory: that inflation is always a factor of their policy and that prices rise as unemployment falls.

The Fed adopted a fixed 2% target in 2012. To achieve it, explains investment writer James Molony, they “have implemented unprecedented policies. Interest rates have been slashed, in some cases to near zero, and they have engaged in printing money in order to buy bonds and other assets, otherwise known as quantitative easing.”

Lowering the interest rate is supposed to encourage lending, which increases the circulating money supply and generates the demand necessary to prompt producers to increase GDP. But the fed funds rate, the only rate the central bank controls, is nearly at zero; and the equivalent rates in the European Union and Japan are actually in negative territory. Yet in none of these three countries has the central bank been able to reach its inflation target.

The Fed has now resorted to “average inflation targeting” – meaning it will allow inflation to run above its 2% target to make up for periods when inflation was below 2%. To turn up the economic heat, Chairman Powell has been pleading for more stimulus from Congress. If Congress issues bonds, increasing the federal debt, the Fed can buy the bonds; and the money spent into the economy will increase the money supply. But federal legislators have not been able to agree on the terms of a stimulus package.

Why can’t the Fed do the job, though, itself? In a speech to the Japanese in 2002, former Fed Chairman Ben Bernanke argued (citing Milton Friedman) that it was relatively easy to fix a deflationary recession:  just fly over the people in helicopters and drop money on them. They would then spend it on consumer goods, creating the demand necessary to prompt productivity. So where are the Fed’s helicopters?

“The Fed Doesn’t  ‘Do’ Money.”

In a recent article titled “Where Is It, Chairman Powell?”, Jeffrey Snider, Head of Global Research at Alhambra Investments, questioned whether the Fed’s policies were creating inflation as alleged at all. He wrote:

After spending months deliberately hyping a “flood” of digital money printing, and then unleashing average inflation targeting making Americans believe the central bank will be wickedly irresponsible when it comes to consumer prices, the evidence portrays a very different set of circumstances. Inflationary pressures were supposed to have been visible by now, seven months and counting, when instead it is disinflation which is most evident – and it is spreading.

The problem, said Snider, is that “The Fed doesn’t do money, therefore there’s no way the Fed can have its monetary inflation.”

The Fed doesn’t “do” money? What does that mean?

As explained by Prof. Joseph Huber, chair of economic and environmental sociology at Martin Luther University of Halle-Wittenberg, Germany, we have a two-tiered money system. The only monies the central bank can create and spend are “bank reserves,” and these circulate only between banks. The central bank is not allowed to spend money directly into the economy or to lend it to local businesses. It is not even allowed to lend it directly to Congress. Rather, it must go through the private banking system. When the central bank buys assets (bonds or debt), it simply credits the reserve accounts of the banks from which the assets were bought; and banks cannot spend or lend these reserves except to each other. In an article titled “Repeat After Me: Banks Cannot And Do Not ‘Lend Out’ Reserves,” Paul Sheard, Chief Global Economist for Standard & Poor’s, explained:

Many talk as if banks can “lend out” their reserves, raising concerns that massive excess reserves created by QE could fuel runaway credit creation and inflation in the future. But banks cannot lend their reserves directly to commercial borrowers, so this concern is misplaced….

Banks don’t lend out of deposits; nor do they lend out of reserves. They lend by creating deposits. And deposits are also created by government deficits. [Emphasis added.]

The deposits circulating in the producer/consumer economy are created, not by the Fed, but by banks when they make loans. (See the Bank of England’s 2014 quarterly report here.) The central bank does create paper cash, but this money too gets into the economy only when other financial institutions buy or borrow it from the central bank in response to demand from their customers. The circulating money supply increases when banks make loans to businesses and individuals; and in risky environments like today’s, private banks are pulling back from Main Street lending, even with massive central bank reserves on their books.

The Tools the Fed Needs to Get Liquidity into the Economy

Private banks are not following through on the Fed’s attempted money injections, but publicly-owned banks would. In countries with strong government-owned banking systems, public banks have historically increased their lending when private banks pulled back. Public banks have a mandate to stimulate their local economies; and unlike private banks, they can do it and still turn a profit, because they have lower costs. They have eliminated the parasitic profit-extracting middlemen, and they do not have to focus on short-term profits to please their shareholders. They can pour their resources into improving the long-term prospects of the economy and its infrastructure, stimulating local productivity and strengthening the tax base.

Three promising new bills are before Congress that would facilitate the establishment of a public banking system in the US.

HR 8721, “The Public Banking Act”, was introduced on Oct. 30, 2020. As described on Vox, the Act would “foster the creation of public [state and local government-owned] banks across the country by providing them a pathway to getting started, establishing an infrastructure for liquidity and credit facilities for them via the Federal Reserve, and setting up federal guidelines for them to be regulated. Essentially, it would make it easier for public banks to exist, and it would give some of them grant money to get started.”

Another bill, introduced in September by Sens. Bernie Sanders and Kirsten Gillibrand, is The Postal Banking Act, which the authors said would

  • Create $9 billion in revenue for the postal service, saving it from privatization;
  • Protect low-income or rural families and communities from predatory lending; and,
  • Reestablish postal banking to provide basic, low-cost financial services to those who cannot access banks

The third bill, HR 6422, “The National Infrastructure Bank Act of 2020,” is modeled on Franklin Roosevelt’s Reconstruction Finance Corporation, which funded the rebuilding of the US economy in the Great Depression of the 1930s. According to its advocates, HR 6422 will build or restore over $4 trillion in infrastructure and create up to 25 million union jobs, while being “revenue neutral” (not burdening the federal government’s budget). The promise of HR 6422 and the model of the “American System” that inspired it – the innovative banking systems of Alexander Hamilton, Abraham Lincoln and Franklin Roosevelt – will be the subject of another article.

This article was first posted on ScheerPost.

The post Why the Fed Needs Public Banks first appeared on Dissident Voice.

Invasion of the Body Snatchers: How Political Science and Neoclassical Economics Zombifies the Yankee Population

ORIENTATION

Why do political science and neoclassical economics go in one ear and out the other?

A human being who has a fully integrated social body understands that economics is about a social system of circulation of goods and services. In other words, provisioning for the population.  Politics is the collective process of evaluating and deciding a) where have we been (our past) and b) where are we going (the future). Politics is about steering.  With this framework, it would be inconceivable to steer or govern without referring to how well the economic system is working. How can you steer without an evaluation of how goods and services are circulating? So too, how can you monitor the economic provisioning process without checking on the decision-making process of the steering of our social direction? In fact, a person with an integrated social body only makes a distinction between economic and political processes for analytical purposes. It would be better to call the whole endeavor “political economy”.

However, if you received an undergraduate college degree you probably never had a class in political economy. What you probably had is at least one class in political science and another class in economics. If you are like most people, you found these classes either boring or incomprehensible. Why? The answer is because both fields are riddled with capitalist propaganda that has little basis in most people’s experience. Sure, there are some people who are convinced that political science and neoclassical economics make sense but which social class is this? Chances are it is members of the upper middle class for whom political and neoclassical economics make sense from their class position. But upper middle-class people are 10% of the Yankee population. Even if we take half of the 30% of the middle class, it is still only a quarter of the population. (I exclude the ruling class and the upper class for whom these courses are not relevant for different reasons).

For the rest of the middle class and lower classes, these courses are likely to produce apathy. There is a reason why Yankee masses hate politics and why they pay no attention to economics. For the elites who control political science and neoclassical economics fields, mass apathy is fine because they don’t want the lower classes asking political and economic questions. Mass apathy doesn’t mean they haven’t internalized the propaganda of political science and/or neoclassical economics. It just means some of these assumptions and images exist in the unconscious of people. For example, most people will say, if asked, “we live in a democracy”. So too they will say economically “there are no free lunches”, right out of neoclassical economics guru Milton Friedman’s playbook.

In the meantime, the social body has now slowly been taken over by two zombies: a political science zombie and a neoclassical economics zombie. This zombification process undergoes at least five processes:

  1. Political science and economics are cut off from history, anthropology and sociology.
  2. Political science and economics are separated from each other. In a political science class, if you ask an economic question about politics you will be told that is “not their department”. If you ask a political question in an economics class you will be told the same thing.
  3. Political science and economics classes become reified because both disciplines are presented as changeless and not subject to scandals, false turns or ideological manipulation. Both fields appear as things, dogmas, idols. In the case of the Constitution or the Declaration of Independence, these documents have become dogma. George Washington or Thomas Jefferson have become idols that are uncriticizable.
  4. Both fields focus on very small micro processes that are relatively inconsequential for the average person’s life. In both fields, this is done because smaller processes lend themselves more easily to scientific measurement. In addition, most neoclassical economics theories are presented in mathematical form which is intimidating for working class and even some middle-class people because they do not have formal training.
  5. Scientific method is emphasized over the content in the field. Unless you have some reason for going into each field professionally, knowledge of how they do science is not really relevant. In the case of Trump, if you want to know how someone with no political experience or training could become the president of Yankeedom, you won’t find the answers in your political science or civics courses.

The result is that any zombified Yankee college graduate is filled with self-congratulatory political science propaganda about the nature of democracy as well as self-congratulatory neo-classical economics which is filled with economics propaganda about the wonders of capitalism.

For this article I will draw on the books Tragedy of Political Science by David Ricci and Disenchanted Realists by Raymond Seidelman and Edward Harpham. For the economics section, I’ve drawn on Introduction to Political Economy by Sackrey, Schneider and Knoedler as well as E. K. Hunt’s History of Economic Thought and Polanyi’s The Great Transformation.

FROM INTERDISCIPLINARY TO SPECIALIZATION OF POLITICS AND ECONOMICS

In the beginning of both the study of politics and the study of economics each was understood as being inseparable from history, philosophy, sociology and anthropology. So, in the case of politics, we could never understand a form of rule without understanding the economic property relations through which rulers, and ruled interacted. Nor could we make sense of the rise and fall of dynasties without understanding the social class composition of the society. Lastly, how could we know how the current ruler differs from rulers decades or even centuries ago without including history.

In the case of economics, the interdisciplinary field that preceded it was called political economy. In the work of Smith, Ricardo and Marx, no economic transactions could be understood without understanding the machinations of political rulers or how the newly formed industrial capitalist society differed from the agricultural, slave capitalism that preceded it. This way of looking at things began to change in the last three decades of the 19th century with the marginal utility theorists Menger, Marshall and Walras, who gradually isolated economics from these other fields. This isolation continued into the 20th century with the Austrian school economics in the work of Eugen Ritter Böhm-Bawerk, Von Mises and Von Hayek just before World War II.

In the United States during the depression the work of Keynes was carried on as a political economy point of view because Keynes was interested in macroeconomics and he insisted the state needed to intervene to keep capitalism from going off the rails. The work of neo-classical economists Samuelson and then Milton Friedman in the 1950s and 1960s emphasized the independence of the market from all political influences.

ZOMBIE NUMBER ONE: POLITICAL SCIENCE PROPAGANDA FOR DEMOCRACY

How the political ideology of liberal pluralism gets in the way of research into how democratic Yankeedom actually is

American political theory has always fancied itself a democratic politics well before the end of the 19th century. There was never a time when political theory considered that Yankee politics’ “democracy” was ever something to be proven. It was already always the case.  Political science was not a neutral approach to the study of politics. It dwelt in a national context of liberal democracy. This political ideology operates with the following postulates:

  • presumption of human rationality – people are capable of thinking through their situation about what their own interest requires them to do;
  • the separation of religious from secular institutions (separation of church and state);
  • separation of political powers into legislative, executive and judicial fields;
  • the presence of more than one political party to represent factions of citizens who must have their interests checked and balanced by the upper classes (electoral college);
  • all that is most profound and enduring about politics was laid down by the Founding Fathers in their documents; and,
  • liberal faith in science as the midwife of social progress and enlightenment.

The infrastructure of democracy – political parties, the electoral college, the constitution, the separation of powers – could not be challenged. This is crucial because it puts a damper on the study of power blocks and the behavior of elites. To the extent that it takes inequalities seriously, it farms them out to other social science disciplines such as sociology or political sociology.

What would happen if the results of actual political scientific research continually denied central tenets of democratic ideology that political scientists in the United States believe in?  Supposed research showed that American citizens do not behave much like democratic citizens? Suppose a political scientist has a hypothesis that democratic theory in practice is an illusion. Can you still practice political science if you believe democracy really doesn’t exist? Suppose a scientist insists on studying politics scientifically even though their inquiry cannot insure the health of a democratic society. Hypothetically you should be able to do this research.

What are the chances of a research grant for a hypothesis designed to show how anti-democratic American social institutions are? Of course, political scientists have done this research in these areas and received grants. But the research in political science would be easier if you proposed research that made people hopeful, comfortable or at least neutral, rather than disturbing them. As of around the year 2000 there were two political science textbooks which did not toe the line of what will later be called “political pluralism”. One was Michael Parenti’s Democracy for the Few, which is Marxist. The other is Irony of Democracy by Louis Schubert and Thomas Dye, which are from the Elitist school of political science.

But political scientists work in educational communities and are somewhat dependent on each other. They have political tendencies that are not based on political facts but on political ideologies that inform the facts whether they are conservative, liberal or Marxist. These ideologies inform whether the reception they receive from their work is cool, hostile or enthusiastic. For example, the topic of political disorder is not looked upon favorably by political scientists. It undermines their theories and cracks their time-honored assumptions. This kind of research is far from welcomed, as important a topic as it might be.

As a political scientist, do you try to use the research to change the institutions in a more democratic way or do you leave the institutions alone and rewrite democratic theory to fit the growing problems and weaknesses of its institutions? The field of political science in the United States did the latter. We will focus on how the ideology of democracy kept political scientists from critically analyzing their own institutions.

Generations of Political Science in Yankeedom

The first generation of politics in the US, from 1880-1900 grounded politics in morality and comparative history. The goal was to pass on qualitative, comparative, eternal wisdom through the ages that led to the development of character.  Teachers taught many subjects in the humanities. A single teacher would be responsible for teaching rhetoric, criticism, English composition, logic, grammar, moral philosophy, natural and political law and metaphysics. Teachers were not expected to “publish or perish”, as commercial publishers would not publish books on research because they were not profitable. Scholars in other disciplines, however, judged their work. A single organization, Allied Social Science Association (ASSA) housed History, Economics and Anthropology. Teachers were both products and co-producers of breadth-full learning.

Progressive era of muckraking: Charles Beard

The period of muckraking in the Progressive Era (1896 – 1916) was more down-to-earth and left-liberal compared to the previous generation. The desire was to expose the conditions and the workings of corporate capitalism with writers like Upton Sinclair, Lincoln Steffens and Ida Turnbull.  Yet they were still interdisciplinary. For example, Charles Beard famously took the Constitution apart and identified the economic property relations that underlined it. Beard’s vision of a new society included the fusion of new state powers with a revived, educated, informed and activist public.

Positivism political science

But after World War I, interest in political muckraking and activism cooled. When the American Political Science Association (APSA) was set up as a field, its connection to research was separated from history, economics or sociology. As capitalists expanded their industry, companies merged into corporations.  They increasingly needed more highly trained managers to help in coordinating production, planning and supervising workers. Universities were chosen as the location to train the middle classes for work in these institutions. Some of these folks became political scientists.

Masses seem uninterested in substantive democracy

Beginning in the 1920s and 1930s, the field of politics was taken over by a positivist scientific orientation and was rechristened as “political science”. The emphasis on science meant using techniques of modern empirical research and descriptive studies. Guided by the perspective that the social sciences could be as rigorous as the natural sciences, modern political science was based not on the discovery of eternal truths, but on an ever-expanding body of quantitative research. Science was considered a university affair in which basic research was done, supposedly independent of how the research could be used.

What this new science found was that Americans did not seem to be acting very democratically at all. Many did not bother to vote and masses were susceptible to dictators. The research showed the average American does not conform to the modern liberalism of Dewey and Roosevelt. Merriam and Gosnell wrote about the non-voting public that 44% of non voters gave general indifference or inertia as reasons for not voting. Lasswell pointed out that the findings of personality show the individual is a poor judge of their own interest. In a world of irrational humans, Lasswell argued that a stable order must rely on a universal body of symbols and practices which sustain an elite. This stable order propagates itself by peaceful methods and wields a monopoly of coercion which is rarely necessary to apply, as Graham Wallas said in Human Nature in Politics.

But what if scientific investigations carefully carried out with the intent to improve society might instead contradict popular expectations and undermine faith in democracy? Were political scientists to inquire into the most efficient ways to overthrow America’s government and then publish the results? These are not the types of questions political scientists would be happy to entertain. The tragedy of political science is that in pursuing scientific facts while ignoring political values, those political values became unconscious as they crippled their ability to critically evaluate and challenge the social institutions that stood in the way of a substantive democracy.

Political science fails to explain dictatorships, communism or fascism

Liberal democracy had failed to take hold in Europe after World War I. Instead, in Mussolini’s control of Italy, dictatorships were established in Portugal, Yugoslavia, Austria, and Bulgaria. In 1931 the Japanese invaded Manchuria. In 1932 the Nazis were voted into power and in 1939 fascism triumphed in Spain – and then came World War II.

Political science provided little guidance for understanding the political processes that were shaping Germany (fascism) and Russia and China (state socialism). With regard to key questions of the day such as why fascism existed or how it was possible for peasants to overthrow governments, they provided no serious answer. Even more damning, they could not explain why the politics in their own country were becoming less democratic. The entire corpus of scientific knowledge seemed unable to provide a course for society to follow which would enlighten the population about the rudiments of democratic government. World War I, fascism, Stalinism and World War II signaled a loosening of forces that would make human progress chaotic at best, rather than automatic

In spite of all this, political science proceeded on its merry way as if nothing had happened. Old liberalism counted on the rationality of citizens and the responsiveness of government. Neither was found to be very true. These are not findings that political science wanted to hear because it strongly supported institutions and practices of liberalism. Probably the most famous political scientist of the 1920s and 1930s, Charles Merriam, still held out hope for the public. He promoted a civic education to improve the political life of the average person.

THIN DEMOCRACY

The reification of research methodology

The first thing political science did was to bury itself in research methodology and stop paying attention to voting patterns or even more seriously, the electoral process itself. It worked overtime to be accepted as a kindred spirit to the natural sciences. Its aim was to make its research methods as close to natural science as possible. This meant quantitative measurement and specialization of the field.

Liberal democracy is like scientific method

John Dewey saw science as organized intelligence. When humans work together at science, the methods they employ individually are reinforced by their interaction collectively as an ever-increasingly joint capacity. Dewey developed a system called instrumentalism to organize the findings of science. Dewey believed that discovering the truth was a dynamic process which was forever incomplete yet evolving. Likewise, Dewey thought democracy must be the scientific method applied to politics. He came to think that the method of political science as at least as important, if not more important, than criticizing and changing political institutions.

In 1945, Karl Popper’s The Open Society and Its Enemies was published. For the next decade, this was the stance that informed many polemics of the Cold War. Like Dewey, Popper saw the application of the scientific method as the road to democracy.  He wanted to use the scientific method in his professional work so as to make modest proposals for reforming small parts of society one at a time – piecemeal social engineering as opposed to a “dangerous” utopian program for reframing all parts of society totally and simultaneously as in Marxism. Part of the process of distinguishing science from non-science is to make a distinction between what is true as the result of research, and what should be done with the research. The basic concepts and hypotheses of political science should contain no elaboration of political doctrine or what the state and society ought to be or do.

A product of this specialization was the loss of communication with the public. Political scientists talked to fewer and fewer people and those who listened heard more and more about less and less. Their research was guided by statistics, survey research, and later on formal modeling and game theory. These studies created jargon incomprehensible to the lay person. Instead political scientists became more concerned with how the work might interest their colleagues. As this happened political scientists lost touch with their colleagues in other disciplines and only discussed their findings with those already in their field. Associations which once housed many disciples differentiated into specialized bodies: Political science became more on the surface and lost its depth and breath. Only concrete scientific investigations could yield true knowledge and that knowledge was empirical, particular and experimentally verifiable.

Political scientists naively believed that by simply amassing more data, eventually a theoretical breakthrough would occur about how political systems changed. But while political scientists were slowly amassing reliable political knowledge about increasingly smaller political processes, in their insistence on separating fact from political commitment they left the barn door open by not providing political alternatives as a guide for social policy. Their political crisis came when Leninists and fascists did have political commitment while political science had nothing qualitatively to offer their own politicians.

Thin (Procedural) Democracy

Additionally, besides burying themselves in research method, their standards for what constituted democracy slipped badly. Instead of facing the lack of real substantive democracy in their own country they simply compared themselves favorably to “totalitarian societies” to make them seem relatively more democratic. The bad news for substantive democracy in the West was papered over by a comparison with the political life in “totalitarian” societies. As the evidence on individual and group irrationality mounted, many members of the discipline felt constrained to advocate an approach to politics designed to compensate for some of democracy’s shortcomings. This thin theory of democracy would praise existing liberal practices and institutions rather than criticize weak democratic processes such as voting and the electoral college. They needed to find new justifications for accepting the sometimes-disappointing outcome of democratic processes in the real world.

Rise of pluralism: political practice of interest groups as social science

If individuals are irrational, how did American democracy control its rulers? Empirical democratic theorists or pluralists examined the dynamics of group politics and the effect of organized interest groups on electoral competition. A plurality of groups competes with each other to constrain rulers and political parties to some extent. Pluralists claim, following Arendt, that unlike atomized individuals in totalitarian societies, in liberal democratic societies voluntary associations can and do exist for exerting pressure. William Kornhauser argued for the importance of maintaining pluralism, a bevy of competing power centers to guard against “mass society”.

Tinkering Instrumentalism as the invisible hand of politics

Why isn’t democracy the collective process by which we first establish our values, list our alternatives, prioritize the alternatives, weigh the potential consequences of each alternative and then act together to test what works? According to pluralists, this collective rational deduction process won’t work because humans cannot agree as to which values are to be pursued.

Dahl and Lindblom claim there is another way, which they call disjointed incrementalism. In Politics, Economics and Welfare, Dahl and Lindblom claim that democratic politics is incremental.  Here small policy steps are taken without reference to unattainable consensus or grand objectives. Since a great many political actors from voters to interest groups to parties to bureaucrats must be consulted before anything gets done, this process will be disjointed. Yet it is a series of policy adjustments and taking small steps via calculated risks where immediate additions to old policy will not at once achieve all goals but at the same time will not unduly invite unforeseen tumultuous consequences.

Political science and the end of ideology movement

The self-congratulatory nature of political pluralism reached new heights with the “end of ideology movement.” From the late 1940’s and well into the 1960’s many leading scholars in the US agreed that Western society had progressed beyond any need for an explicit liberal ideology because liberalism had already won. The fundamental decency and social efficiency of American policy had been conclusively proven between 1930-1950. Daniel Bell (End of Ideology), Seymour Lipset, (Political Man) and Edward Shils agreed that most political parties in the West paid only lip service to ideology anyway. Secondly, there were so few social issues left that only practical tinkering rather than ideological solutions was needed. Daniel Boorstin’s book The Genius of American Politics argued that American political institutions by-passed the need for ideology. Raymond Aron, in the Opium of the Intellectuals, called for the abolition of ideological fanaticism and the advent of skeptics who will doubt all models and utopias. They rejected ideological speculation because its propositions could not be confirmed or disconfirmed. To questions about their ideological use of “the end of ideologies” in the service of the Cold War they responded that the Cold War was largely a military affair. Anti-ideologists represented the dominant American mood after WWII.

Political science pluralism excludes the working class

Seymour Lipset writes about working class authoritarianism. He points out that studies show the poorest strata of Western society were most likely to support Communist parties. Lipset believes the lower-class people simply do not fit the requirements for good citizenship. They are insufficiently pragmatic, open-minded skeptical and tolerant. Therefore, there is a social utility in the relative weakness of the lower classes. Real world democracies operate on the basis of high participation by elites with their superior political knowledge.  Low participation by the masses might impair the political process with their undemocratic attitudes. Liberal political scientists had accepted apathy among citizens.

Rough road for political science in the 1960s

As most everyone knows, the 1960s were a time of explosion that neither Popper nor the pluralists predicted. As far back as the mid-1950s C. Wright Mills described a concentrated power elite which controlled society rather than the pluralist theories of a many-centered polity. The civil rights movement, the opposition to the Vietnam War, the rise of the New Left and the women’s movement all went unexplained by political science pluralism.  Whether they called for reform or revolution, the politics of the 1960s were far from pluralist instrumentalism. Murray Edelman, in his book Symbolic Use of Politics, says the job of democratic procedures is to provide the public with symbolic gratification. Elections are for expressing discontent, for articulating enthusiasm, for enjoying political involvement and legitimating the democratic regime by giving it the appearance of popular support. Herbert Marcuse attacked pluralism for creating a “one-dimensional man”. John Galbraith argued that capitalism was not creating real public goods such as roads and bridges but was creating or expanding on the fleeting fancies of consumer products introduced by advertising.

Students complained that the universities were machines in the service of churning out passive consumers or beholden to military contractors. Student activists wanted universities to be agents of change, not handmaidens to the status quo. What united all these strands was a vision of politics that was participatory, not consensual. Political sciences had been focusing on conventional political processes, not the quality of the institutions themselves. They dealt with congresses, political parties, but not the content of what these institutions were doing. Students wanted more policy studies – that is, what the government chooses to do or not do. There were too few, if any, quantitative research studies found on powerful bureaucracies like the Department of Justice, the Ford Foundation or Institute for Defense Analysis. Political philosopher Sheldon Wolin advocated a for a renaissance in the vocation of political theory – to read, analyze, appreciate, extend and build upon the great political philosophers of yesterday. He called for a development of “epic theory”. Political science was not neutral. No stance is a stance for the status quo.

ZOMBIE NUMBER TWO: NEOCLASSICAL ECONOMICS

From political economy to neoclassical economics

Just as political science got cut off from its relationship to history, sociology, anthropology and moral theory by end of World War I, so too economics theory also got cut off from history, politics, anthropology and moral theory beginning around 1870. What now passes for economics, which is known in the United States as neoclassical economics, didn’t exist until the mid-20th century. Throughout the 18th-19th century there was a tradition called “political economy” which included Adam Smith, David Ricardo, Karl Marx and John Stuart Mill among others. Political economics assumed that economics could not be separated from history, politics or anthropology. It was only in the last three decades of the 19th century with the work of Jevons, Walras and Marshall – with what was called “marginal utility theory” – that economics began to be treated as if it could be separated from these other fields. The Austrian school of von Böhm-Bawerk, Von Mises and Von Hayek continued this tradition which separated the economy from the rest of social life. In the United States Paul Samuelson and Milton Friedman brought together neoclassical economics fields.

Polanyi’s Great Transformation

In his powerful book The Great Transformation, political economist Karl Polanyi argues that for most of human history there was no such thing as a separate realm called “the economy”. The economy was embedded in social relationships regarding the circulation of goods based on principles of “reciprocity” within families and kin groups. At the level of the state power of kings and aristocrats, these political relationships were regulated by what Polanyi called “redistribution”. What might be called an “economy” was limited to some trade relations between societies, not within them.

Polanyi argues that this began to change when capitalism brought into society the wheeling-and-dealing that was once limited to trade between societies. At the end of the 18th century when industrialization began to pulverize community relations based on generalized reciprocity and redistribution, the state became more centralized and reorganized society as market relations. There is no better account of this great transformation than to examine Adam Smith’s Wealth of Nations. While Adam Smith is considered the “father” of neoclassical economics, in most ways he represented a cross between political economy and neoclassical economics. In the first section below I will contrast him with those harder-line political economists like Marx. In the next section I will show how different he was from neoclassical economists.

Substantive vs formal rationality

If you ask most people what an economy is, they will tell you that it is a social process by which people work to produce goods and then the goods are circulated and consumed. But in the minds of neoclassical economists, the economy is not a society-wide social process involving the transformation of nature to meet human needs through a production and circulation process. For neoclassical economists, the economy is a micro exchange between self-interested, hedonistic individuals who compete with each other. Their decisions about what will be traded or bargained is based on short-term self-interest in which they weigh the pros and cons. Society is no more than the aggregate sum of these micro interactions.

Adam Smith vs radical political economists (Marx)

Turning to Adam Smith’s The Wealth of Nations, the first thing worth noticing is the ahistorical manner in which the origins of capitalism are presented. Smith argues that individuals “trucked and bartered” all the way back to hunting and gathering societies. Ideologically it is important to establish that some form of capitalism has always existed. For Marx and the institutionalist political economy theory, capitalism has a more recent origin in the 15th and 16th centuries. No anthropologist who studied tribal societies would try to make Smith’s case.

Secondly, Smith claims that capitalism starts when frugal, hard-working, shrewd traders identify a need to invest capital in land. In the best of all possible worlds, the product sells and he makes a profit. This capitalist has to compete with other traders and the results of this competition are better products for everyone. Smith called this “the invisible hand” of the market. Marxists and post-Keynesians contest this. Marx argued that capitalism doesn’t begin with trading. It begins with what Marx called “the primitive accumulation of capital” when peasants are thrown off the land (enclosures) and their tools and animals are taken away from him. The capitalist uses the land for commercial farming growing coffee, sugar, cotton and tobacco through the labor of slaves. Meanwhile former peasants are driven to work in cities and eventually work in factories after capitalists have revolutionized industry in the 19th century.

Smith believes that the source of profit is in the circulation process. Capitalist make profits by winning the competition, buying land cheap and selling it dear. His ingenuity and risk-taking are rewarded. For Marx, the key to understanding the source of profit is not primarily circulation process, but the production process. Marx says that the exploitation by the capitalist of the laborer comes in the form of wages paid to the worker. Marx estimated that the wages of work covered the first four hours of labor. This was enough money to reproduce working-class life. The last 4-6 hours were surplus labor that was pocketed by the capitalist. So, the ultimate source of profit was the exploitation of labor power. Smith also has a labor theory of value, but it was not the most important factor.

Adam Smith was sensitive to the cost the specialization of labor might have on the body and mind of the worker in terms of alienation on the job. Despite that, he felt that the massive productivity of volume that would result was worth that cost. In Bertell Ollman’s great book Marx’s Theory of Alienation he points out that workers are alienated from a) the process of labor; b) the products of labor; c) other people on the job while laboring; d) the tools harnessed; e) alienation from himself. Marx’s hope was that once an abundance of goods was produced the worker should work less and have a diverse set of activities, as he said, fishing in the morning, cattle rearing in the afternoon, criticism in the evening.

Human nature for Smith is pretty bleak. He believed that human beings are pleasure-seeking, rational and competitive, but lazy. Most people would prefer to do nothing and it is only by the carrot and the stick of enterprising capitalists that makes workers productive. For Marx, people are naturally collectively creative and want to cooperate. People only appear lazy when they have been performing wage labor and they are tired and miserable. When people control their conditions of labor, they are more productive than under capitalist conditions. This has been shown in evidence of worker cooperatives and workers councils during revolutions.

For Adam Smith the fruits of competitive capitalism led to lower prices for consumers. Marx said this is not what actually happens. Competition between capitalists leads to a concentration of capital in a few corporations and the elimination of smaller capitalists. As Marxists Baran and Sweezy point out, corporate capitalists agree not to engage in cut-throat competition and the prices of commodities are pretty much the same. They compete through advertising, not through the prices themselves.  There are many more contrasts that could be made, but these are the most important. Let me turn now to the difference between Adam Smith and neo-classical economists like Milton Friedman. It is Milton Friedman‘s right-wing economics that is propagandized in college courses.

Adam Smith Vs Milton Friedman

Despite Smith’s departure from the more leftist political economists of Marx or Thorstein Veblen, compared to Milton Friedman, Adam Smith would have been considered a left liberal. In the first place, Adam Smith understood that the state was necessary for public works like roads, canals and harbors to provide education and defense. With rare exceptions, Milton Friedman wanted the state completely out of the market. His theory was “let the markets run everything”.

While Adam Smith was sensitive to the impact of the working conditions in factories, Milton Friedman might say that workers are free to find work elsewhere if the working conditions did not suit them. In terms of the source of profit, Adam Smith, like Marx, also included a labor theory of value. That means that the cost of a product depended at least partly on the labor time it takes to produce the product. To my knowledge, Milton Friedman ignored this.

How is wealth measured? Smith had an infrastructural answer to this. For him wealth is measured in a) the increased dexterity of every workman; b) the amount of time saved; and c) the inventions of machines that would shorten the workday for workers. Ultimately for Smith the increase in the standard of living of the poor should be the ultimate determination of social wealth. By today’s neoliberal and neoconservative light, Adam Smith would be to the left of Bernie Sanders! For Milton Friedman, he believed that maximizing the profits of capitalists would have a trickle-down effect on the poor.

Notice there is nothing in Adam Smith’s work about investment in the military or finance as sources of profit. For Adam Smith production of material, physical wealth was how profit was measured. For Milton Friedman, profit should be measured regardless of the field. This means that the profits made on a tractor and the profits made on a tank should all count as profit. This fails to make the distinction between tools which can produce food and tools which destroy land and people. So too, for Friedman, profits made on finance capital, investment in paper which produces no material wealth is the same as profits made on building roads, bridges or houses.

Adam Smith, like political economists such as Thorstein Veblen, included the creativity of farmers, artisan, scientists and engineers as creative sources for the economy. For Milton Friedman, the only fount of creative power was the ingenuity of the capitalist. Apparently, Friedman had little idea that the wealth capitalist possessed was not the result of personal ingenuity but most often from inheritance. Last time I checked about 2/3 of capitalist got their wealth from the inheritance they received.

Playing Hardball: the totalitarian nature of capitalist economics courses

In the fields of psychology, a student is presented with six different theoretical schools: psychoanalysis, behaviorism, humanistic psychology, physiological, evolutionary psychology and cognitive. In the fields of sociology, we might be presented with three founding schools – Marx, Weber and Durkheim. Second generation schools might be added: The Elitists (Mosca, Pareto, Michels), symbolic interactionists and rational choice theory. But in the field of economics, in Economics 101 classes, the student is presented with one school. That school would be the neoclassical economics of Samuelson and then later, Milton Freidman. No matter what the chapter heading, neoclassical economics has an interpretation and analysis.  Keynesian theory might be presented somewhat, but only in select chapters. Surprisingly only two schools are presented. Does this mean there are only two schools? Hardly.

In their book Introduction to Political Economy, Sackrey, Schneider and Knoedler identify a number of other schools. In addition to a full presentation of Keynes, also included are the works of John Kenneth Galbreath, Thorstein Veblen, Karl Marx, along with might be called the anarchist economics of worker cooperatives. There are other schools called post Keynesians like Steve Keen and Michael Hudson. These are all first-rate economics, why are they not included?

The reason is solely for propaganda purposes. Neoclassical economics theorists are cheerleaders for what I call market fundamentalism. Other schools vary in calling for more state intervention (Keynes, Galbraith) while some are critical of finance capitalism (Keens and Hudson). Others like Marxists and anarchists are critical of the entire capitalist system. The propagandistic nature of neoclassical economics can be more blatantly seen in the fact that there is not one Marxian economist in the United States that is the head of an economics department.

Conclusion

It has often been said by people living outside of Yankeedom that the Yankee masses are stupid people. We don’t know anything about the history of other societies or where they even are on the globe. As true as this may be, what is even more disturbing is that Yankee masses do not understand our own political economy. This article was designed to show how our social bodies have been snatched away and then inhabited by two zombified entities. A political science body which is designed to persuade us that we live in a democracy despite our own best judgment. The evidence political science offers us is self-congratulatory, contradictory, irrelevant, myopic, filled with deceptive comparisons and anti-communist.  The other body is a neo-classical economic entity which is also triumphant, mystifying, naïve, cynical, wooden, anti-social, shallow, obscurant and also anti-communist. Anyone in Yankeedom who manages to recover their social body must go through a process of de-zombification. What does this recovery look like? We must analyze the world through a political economy which is interdisciplinary, which is always undergoing quantitative and quantitative changes and through which we can collectively imagine and then build a new socialist world.

The post Invasion of the Body Snatchers: How Political Science and Neoclassical Economics Zombifies the Yankee Population first appeared on Dissident Voice.

Are You Ready for a Guaranteed Income for All?

Image from Peterborough Examiner

The world-wide collapsing economies and collapsing ecosystems together create such a catastrophic storm that all versions of buttoning down the hatches and weathering it out simply won’t work. The history of economy has been to tear at the earth until life itself cannot be sustained. The western addiction to profit at any cost has opened the floodgates to massive inequality, poverty and starvation across the globe.

The solution? — a global guaranteed income for all, what some social pioneers are calling a universal basic income (UBI). Oh! but who are these people kidding but themselves. Have they forgot that over-population worldwide kills this baby in the crib?

Contrary to belief, one of the first things people do when they have money is to control their family size. Yes, there will continue to be people who will want to be fruitful and over-multiply, but the number of concerned people is so great that a population reduction would immediately begin. At the Institute for Food and Development Policy, Frances Moore Lappé and Rachel Schurman reveal how “poverty is the TNT in the population bomb.” So don’t panic that 7.7 billion suddenly-fed mouths will automatically lead to another 7 billion mouths to feed.

Let’s create a model for a guaranteed income, then discuss background pros and cons. I will use U.S. economic numbers. Every other country can produce its own currency and guaranteed income using this design, creating in totality a world free of poverty and want.

For this model, we’ll use the productive sum total of the entire economy. As context, it started with the industrial revolution. Manual labor began moving from farming into factories of manufacturing. In the year 1760 Britain compiled the total production of manufacturing into a number called the Gross Domestic Product (GDP). In recent times, the GDP was changed to the Gross National Product (GNP).

The latest finalized number for the GNP for the U.S. is for the year 2018 at $20.18 trillion, according to the World Bank. The number of adults over the age of 18 in the U.S. is 209,128,094. If we divide the GNP by the number of adults, we get 99,651.84. This reflects an equal share for all adults of the GNP.

What is to stop us from issuing currency to each adult for the amount of $99,651.84 for the year 2018. Then we add a new differently designed currency again for 2019, the amount depending on the GNP. Let’s add three more years, making it a 5-star economy. So, what happens on the sixth year? The 2018 currency value collapses to zero and a new currency is made in its place. From then on, every year, one currency dies while another one is born. The 2018 currency collapses in 2023. The 2019 currency collapses in 2024, and so on; but a new currency replaces it; it’s just that simple. A perpetual economy is born. Rather than a paltry poverty-level UBI, we create a GNP-shared income (GNP-SI).

Since the Covid-19 disruption has had such a devastating effect on the economy, we can position a second option of using the 2018 GNP for each year of the 2018-2022 five-year rotation, unless unforeseen events snap back the economy to its normal yearly increase. The practical result is nearly the same. Multiplying the 2018 $20.18 trillion GNP by five gives us a $100.9 trillion perpetual economy.

Setting up the disbursement of cash is a straight-forward task. In the U.S., Constitutional money is gold or silver coin. Historically, silver and gold certificates have substituted for coin, which is too heavy to carry around.

The bigger job will be to update the GNP. Much of the work is done without pay and is therefore unregistered and uncounted for as part of the GNP. All service work needs to be included. So, if you have served, for instance, as a caregiver for some sick or elderly person, you should be able to walk into a government office and declare this work. A fair assessment can then be given to the work. The assessed value is then added to the aggregate GNP.

With people having enough money to follow the American dream, what opens up instantly is a vista onto a world that can now be saved from human destruction. Here are a few starters:

• People don’t have to go to work and build millions of new cars that are sending us over the cliff.
• Vast rail and shipping networks can quickly reduce our carbon footprint by leaps and bounds.
• People won’t show up to work in the morning to cut down the world’s forests for some psychopathic billionaire.
• The service work of protecting endangered species and marine sanctuaries will explode. Permaculture seaweed beds can carbon sink enormous tonnage, while creating havens in open ocean for fish and sea life to flourish.
• Plastic pollution is destroying our oceans and planet. New solutions are coming to bear. Watch the new documentary: The Story of Plastic.
• Regenerative localized farming practices can quickly replace destructive corporate land use for profit rather than bio-rich food.
• The application of biochar to the land will supercharge the quality of the global diet.
• Vast quantities of organic compost can be generated, without water, on the semi-arid deserts that constitute 40% of the world’s land surface using the agave plant and mesquite trees. See Ronnie Cummins new book: Grassroots Rising: A Call to Action on Climate, Farming, Food and a Green New Deal.
• Geoff Lawton took permaculture (permanent agriculture) to Australia and within 3.5 years he’s turned desert into an agricultural heartland without irrigation or artificial fertilizer.
• Virginia farmer Joel Salatin demonstrates how incredibly successful and sustainable natural farming can be. He hasn’t planted a seed or purchased a chemical fertilizer in 50 years.
• Warmongers will struggle to find mercenaries. Most people would rather ‘go fishing’ than kill people. Warmongers top the list of most destructive people, killers of people and nature.
• With today’s use of artificial intelligence and robot welders doing most of the manufacturing, service work becomes open to unimagined possibilities.

The beginning of the idea of GNP-SI goes back at least to the dawn of the industrial age. Futurists proscribed a new world order, a Garden of Eden economy for the exhausted masses. Machines would do the work, while government would split the profits created by the machines amongst the populace. But something got in the way.

British royalty and a new class of industrial magnates were aghast by the ideas of sharing wealth and economic liberation. The whole notion of royal ascension to power, the prerogatives and privileges it brings, with class layers of labor would all be put at risk. To think that the toiling masses might enjoy leisure was enough to make an aristocrat choke. Written history is replete with examples of self-anointed demigods belittling what they call the unwashed masses. Feudalism was in place and no uppity futurist was going to spoil the plot.

Expect the equivalent elites of today to fight against any UBI or GNP-SI. Inequality, poverty, sickness, famine, pandemics, and death amongst the masses shall go on just as before. Old excuses and new forgeries will be evoked to prove that equality is forever impractical.

Here are a few:

UBI is inflationary and therefore not reasonable. Not really—the 5 year rotation creates a ceiling amount that endures over time, approximately $100 trillion for the U.S. As described above, money creation is rotational, circular, meaning perpetual.

The current practice of quantitative easing by the Federal Reserve is inflationary. The number of dollars they create has no end in sight. The more they print, the less value the money in your pocket has. The rich get richer and the poor get poorer.

UBI would create a permanent lazy mass class that will only accelerate planetary destruction. Studies show that people want to help rather than sit around. When people get money, the first thing they do is get free from the grinding stagnation of poverty. Money is power. A UBI gives people the freedom to choose their own direction in life. The examples cited above are just a few ways people will respond to help save the planet for posterity. The masses will be set free to explore their creativity. The vast majority have said they want a planet that will sustain life for posterity. UBI gives them the chance to get some skin in the game.

GNP-SI is a breath-taking proposal. With such a huge shift toward sharing common wealth, old suspicions and concern about equal pay for equal work will persist. A commendable human social feature is that we love fairness. If abled persons refuse to put in effort and sacrifice for the overall economy, then why should they divvy up the profits equally with those who did put in effort and made sacrifices?

Flush with money, why would people work? Why should people continue at jobs that are for someone else’s profit, jobs that feed the over-consumption of the planet and tear at the ecosystems that are forced to absorb the shock of aggregate human behavior? Maybe opening a door to less productivity, even laziness, is a welcome feature for survival. It was certainly not welcome in the past.

When humans first lived in tribes, everyone had to pull their own weight or risk the survival of the community. Some sort of “equal” effort was imperative. Thus, we have a natural deep-seated fear of being pulled down by laziness or its equivalent by others.

This inherent fear can’t help but impinge on our ability to adjust to the new artificial world of industrialization where machinery of all kinds yield so much leverage and power over the basic challenges of survival. The levers of industrialization also brought with it new opportunity to continue ‘equality’ in the tribal effort. Industrialists were now in a position to share newly found wealth with their tribe of workers or do otherwise.

Witness to history, another age of greed took hold, preferring to perpetuate a likeness of king over subject, of master over slave, now industrial owner over worker, such that, slave wages well below the cost of living have persisted for the vast majority, which is exactly why it’s long overdue to create a GNP sharing program to adjust for the inability of greed to resolve itself, especially when care for ancient tribe and modern community have been lost.

Moreover, we must not forget that able-body persons are now, more than ever, in competition with super-body robots that can, for instance, weld auto bodies together at a record pace and with near perfect repetition. Automation is geared for profit not job creation, especially when mutual human respect is missing. Bots and advancing artificial intelligence increasingly make up the GNP work output, reducing the average citizen’s chances of entering the workforce as a meaningful participant.

Outstanding remains the question of important jobs not getting done if everyone is off living their American dream. Critical restoration is an example. Long-standing environmental damage and destruction continue because of political corruption and interference.

A case in point is the nuclear industry. Why should nuclear-related stockholders be allowed to profit from making the planet uninhabitable for posterity? If we are going to get serious about saving the planet then we have to make nuclear profiteers responsible for nuclear cleanup. This is a dirty job that needs to be done, and we the people, need to make these profiteers pay for their abuse of the planet and crime against posterity.

GEN-Z is screaming for global productive work to go towards saving the planet. A GNP-SI finally gives the masses the mobility and power to help them. Transforming the economy is essential to kick-starting many solutions begging for attention.

Another criticism will be that some countries are too poor to use GNP—wrong. If they apply fair value to all the goods and resources exported and add to that a fair value for all of the work done with and without pay, you suddenly have a GNP that will work quite well using their own currency.

To be clear, the GNP should reflect all of the work done, not just the work paid for. Many people work for free, helping friends and relatives who are too poor to pay for help. So, a vast store of work is being left out of the equation of GNP to the detriment to all. A fair assessment of all unaccounted for work should be added to the GNP to give the utmost true picture of valued human activity.

The private central banks will never give up their stranglehold on both the market and financial economies. This is the biggest challenge to any UBI proposal. Bankers seem impossible to defeat. The coronavirus is just the latest excuse to gift themselves and corporate elites with a multi-trillion dollar bailout. Trickery seems to never sleep. They manipulate the stock market with derivatives and credit default swaps, hedge funds, mortgage bubbles, and financial instruments that create toxic debt of all kinds.

They have given a nice euphemistic-sounding name to a new fraud called quantitative easing (QE). On the subject of QE, billionaire hedge fund manager Stanley Druckenmiller stated, “This is fantastic for every rich person. This is the biggest redistribution of wealth from the middle class and the poor to the rich ever.” Worse, many people believe that lavishing tax breaks on the rich will cause them to create employment. Druckenmiller confides that the billion dollar give-a-ways to billionaires by megabanks have not led to a trickle down of jobs.

Robbing the masses in not new in history. Kings robbed workers and slaves alike. Then came privately owned banks.

The U.S. privately owned central bank was born in 1913. It was named the Federal Reserve to deceive the public into believing it was owned federally by the people. The federal income tax was introduced the same year. The plan was to transfer wealth from the working classes to the federal government, then from the federal government to the bankers.

A GNP-SI creates a major challenge to this direct theft from workers to bankers. A GNP-SI allows the masses to break free from the mega-bank financial market manipulations. Wall street fraud needs to die on the vine and fraudsters need to go to jail.

The massive financial losses of workers world-wide due to the coronavirus is no accident. Follow the money. Working people daily lose houses to the bankers. The unipolar worldwide financial system is part of the broader project of the Wall Street financial elites to establish the contours of a world government.

Filling the world with fresh cash defeats the digital financial manipulations by the banks to create a unipolar cashless Feudal system. Now is the time to replace the elite’s plan for universal poverty with universal income. Now is the time to make our planet livable. Are you ready for a 5-star economy for all?

The post Are You Ready for a Guaranteed Income for All? first appeared on Dissident Voice.

Modern Monetary Theory (MMT) and the Power of the US Dollar in the World Economy (Part 1)

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

  1. 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%.

Claudio Grass, a Swiss banker, gives a higher figure, with around 70% of world trade conducted in US dollars, and excluding trade among European states based on the euro, the percentage goes up to 90%. Forbes noted:

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.

The Chinese renminbi (RMB), despite China being the world’s number one trader with 12.4% of world trade in 2018, was used in a mere 2% of international payments. 3   The US, by contrast, is second largest with 11.5%, yet the dollar reigns as the world currency.

For Latin America, 97% of exports and 90% of imports are still made in dollars4  even while China’s trade with Latin America has grown to half the size of US trade with the region.

The United States stands in sharp contrast to other nations, again showing the world power of the dollar. In 2015 93% of US imports were invoiced in the dollar, while 97% of its exports were.

  1. 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.

The dollar’s portion of these foreign reserves has remained relatively the same since 2009. The New York Times noted 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.”

  1. Almost Two-Thirds of International Debt Held Outside the US Must be Paid in Dollars

In 2018, 63% of international debt was denominated in dollars (to be paid in dollars), a percent that has been slowly rising since 2005. The second most common currency owed for international debt is the euro, at about 23%.5

There is $28 trillion worth of debt, to be paid in dollars, held by governments and private business outside the US. This is said to increase $1.6 trillion to $2 trillion a year. Foreign countries actually issued $11 trillion of this $28 trillion debt in the US currency rather than their own.

Third World government debt was the equivalent of 15 trillion in dollar terms. About 70% of this Third World debt is actually issued and owed in US dollars. This debt in dollars held abroad further serves to entrench the dollar as the world sovereign currency.

  1. Foreign Exchange Trading Dominated by the Dollar

Foreign exchange is the process of changing one currency into another for a variety of reasons, usually for commerce, trading, or tourism. The Foreign Exchange market has an estimated turnover of $6.6 trillion a day. In 2019, 88% of the world’s foreign exchange trading involves exchanging some currency with one in particular, the US dollar.  The euro ranked second with 32%, Japanese yen third at 17%. Chinese RMB ranked eighth at 4%. The dollar’s hold in this measure of the world’s most dependable currency remains the same as in 2004, while the euro, yen and British pound have tended to decline.6

  1. Most Foreign Currencies Rotate around the Dollar

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.

  1. Annual Report on Exchange Arrangements and Exchange Restrictions 2018, p. 18-19.
  2. The report notes in 2018 “the Central Bank of Somalia does not have a monetary policy framework”
  3. European Central Bank: The International Role of the Euro (June 2019), Box 1 Chart A.
  4. Ibid., Chart 26.
  5. Ibid., Chart 2 and p.19ff.
  6. Bank for International Settlements: Foreign Exchange Turnover in April 2019, p. 10.
  7. Annual Report on Exchange Arrangements and Exchange Restrictions 2018

The post Modern Monetary Theory (MMT) and the Power of the US Dollar in the World Economy (Part 1) first appeared on Dissident Voice.