The Collapse of Globalization
Posted on Mar 27, 2011
By Chris Hedges
The uprisings in the Middle East, the unrest that is tearing apart nations such as the Ivory Coast, the bubbling discontent in Greece, Ireland and Britain and the labor disputes in states such as Wisconsin and Ohio presage the collapse of globalization. They presage a world where vital resources, including food and water, jobs and security, are becoming scarcer and harder to obtain. They presage growing misery for hundreds of millions of people who find themselves trapped in failed states, suffering escalating violence and crippling poverty. They presage increasingly draconian controls and force—take a look at what is being done to Pfc. Bradley Manning—used to protect the corporate elite who are orchestrating our demise.
We must embrace, and embrace rapidly, a radical new ethic of simplicity and rigorous protection of our ecosystem—especially the climate—or we will all be holding on to life by our fingertips. We must rebuild radical socialist movements that demand that the resources of the state and the nation provide for the welfare of all citizens and the heavy hand of state power be employed to prohibit the plunder by the corporate power elite. We must view the corporate capitalists who have seized control of our money, our food, our energy, our education, our press, our health care system and our governance as mortal enemies to be vanquished.
Adequate food, clean water and basic security are already beyond the reach of perhaps half the world’s population. Food prices have risen 61 percent globally since December 2008, according to the International Monetary Fund. The price of wheat has exploded, more than doubling in the last eight months to $8.56 a bushel. When half of your income is spent on food, as it is in countries such as Yemen, Egypt, Tunisia and the Ivory Coast, price increases of this magnitude bring with them malnutrition and starvation. Food prices in the United States have risen over the past three months at an annualized rate of 5 percent. There are some 40 million poor in the United States who devote 35 percent of their after-tax incomes to pay for food. As the cost of fossil fuel climbs, as climate change continues to disrupt agricultural production and as populations and unemployment swell, we will find ourselves convulsed in more global and domestic unrest. Food riots and political protests will be inevitable. But it will not necessarily mean more democracy.
The refusal by all of our liberal institutions, including the press, universities, labor and the Democratic Party, to challenge the utopian assumptions that the marketplace should determine human behavior permits corporations and investment firms to continue their assault, including speculating on commodities to drive up food prices. It permits coal, oil and natural gas corporations to stymie alternative energy and emit deadly levels of greenhouse gases. It permits agribusinesses to divert corn and soybeans to ethanol production and crush systems of local, sustainable agriculture. It permits the war industry to drain half of all state expenditures, generate trillions in deficits, and profit from conflicts in the Middle East we have no chance of winning. It permits corporations to evade the most basic controls and regulations to cement into place a global neo-feudalism. The last people who should be in charge of our food supply or our social and political life, not to mention the welfare of sick children, are corporate capitalists and Wall Street speculators. But none of this is going to change until we turn our backs on the Democratic Party, denounce the orthodoxies peddled in our universities and in the press by corporate apologists and construct our opposition to the corporate state from the ground up. It will not be easy. It will take time. And it will require us to accept the status of social and political pariahs, especially as the lunatic fringe of our political establishment steadily gains power. The corporate state has nothing to offer the left or the right but fear. It uses fear—fear of secular humanism or fear of Christian fascists—to turn the population into passive accomplices. As long as we remain afraid nothing will change.
Friedrich von Hayek and Milton Friedman, two of the major architects for unregulated capitalism, should never have been taken seriously. But the wonders of corporate propaganda and corporate funding turned these fringe figures into revered prophets in our universities, think tanks, the press, legislative bodies, courts and corporate boardrooms. We still endure the cant of their discredited economic theories even as Wall Street sucks the U.S. Treasury dry and engages once again in the speculation that has to date evaporated some $40 trillion in global wealth. We are taught by all systems of information to chant the mantra that the market knows best.
It does not matter, as writers such as John Ralston Saul have pointed out, that every one of globalism’s promises has turned out to be a lie. It does not matter that economic inequality has gotten worse and that most of the world’s wealth has became concentrated in a few hands. It does not matter that the middle class—the beating heart of any democracy—is disappearing and that the rights and wages of the working class have fallen into precipitous decline as labor regulations, protection of our manufacturing base and labor unions have been demolished. It does not matter that corporations have used the destruction of trade barriers as a mechanism for massive tax evasion, a technique that allows conglomerates such as General Electric to avoid paying any taxes. It does not matter that corporations are exploiting and killing the ecosystem on which the human species depends for life. The steady barrage of illusions disseminated by corporate systems of propaganda, in which words are often replaced with music and images, are impervious to truth. Faith in the marketplace replaces for many faith in an omnipresent God. And those who dissent—from Ralph Nader to Noam Chomsky—are banished as heretics.
The aim of the corporate state is not to feed, clothe or house the masses, but to shift all economic, social and political power and wealth into the hands of the tiny corporate elite. It is to create a world where the heads of corporations make $900,000 an hour and four-job families struggle to survive. The corporate elite achieves its aims of greater and greater profit by weakening and dismantling government agencies and taking over or destroying public institutions. Charter schools, mercenary armies, a for-profit health insurance industry and outsourcing every facet of government work, from clerical tasks to intelligence, feed the corporate beast at our expense. The decimation of labor unions, the twisting of education into mindless vocational training and the slashing of social services leave us ever more enslaved to the whims of corporations. The intrusion of corporations into the public sphere destroys the concept of the common good. It erases the lines between public and private interests. It creates a world that is defined exclusively by naked self-interest.
The ideological proponents of globalism—Thomas Friedman, Daniel Yergin, Ben Bernanke and Anthony Giddens—are stunted products of the self-satisfied, materialistic power elite. They use the utopian ideology of globalism as a moral justification for their own comfort, self-absorption and privilege. They do not question the imperial projects of the nation, the widening disparities in wealth and security between themselves as members of the world’s industrialized elite and the rest of the planet. They embrace globalism because it, like most philosophical and theological ideologies, justifies their privilege and power. They believe that globalism is not an ideology but an expression of an incontrovertible truth. And because the truth has been uncovered, all competing economic and political visions are dismissed from public debate before they are even heard.
The defense of globalism marks a disturbing rupture in American intellectual life. The collapse of the global economy in 1929 discredited the proponents of deregulated markets. It permitted alternative visions, many of them products of the socialist, anarchist and communist movements that once existed in the United States, to be heard. We adjusted to economic and political reality. The capacity to be critical of political and economic assumptions resulted in the New Deal, the dismantling of corporate monopolies and heavy government regulation of banks and corporations. But this time around, because corporations control the organs of mass communication, and because thousands of economists, business school professors, financial analysts, journalists and corporate managers have staked their credibility on the utopianism of globalism, we speak to each other in gibberish. We continue to heed the advice of Alan Greenspan, who believed the third-rate novelist Ayn Rand was an economic prophet, or Larry Summers, whose deregulation of our banks as treasury secretary under President Bill Clinton helped snuff out some $17 trillion in wages, retirement benefits and personal savings. We are assured by presidential candidates like Mitt Romney that more tax breaks for corporations would entice them to move their overseas profits back to the United States to create new jobs. This idea comes from a former hedge fund manager whose personal fortune was amassed largely by firing workers, and only illustrates how rational political discourse has descended into mindless sound bites.
We are seduced by this childish happy talk. Who wants to hear that we are advancing not toward a paradise of happy consumption and personal prosperity but a disaster? Who wants to confront a future in which the rapacious and greedy appetites of our global elite, who have failed to protect the planet, threaten to produce widespread anarchy, famine, environmental catastrophe, nuclear terrorism and wars for diminishing resources? Who wants to shatter the myth that the human race is evolving morally, that it can continue its giddy plundering of non-renewable resources and its profligate levels of consumption, that capitalist expansion is eternal and will never cease?
Dying civilizations often prefer hope, even absurd hope, to truth. It makes life easier to bear. It lets them turn away from the hard choices ahead to bask in a comforting certitude that God or science or the market will be their salvation. This is why these apologists for globalism continue to find a following. And their systems of propaganda have built a vast, global Potemkin village to entertain us. The tens of millions of impoverished Americans, whose lives and struggles rarely make it onto television, are invisible. So are most of the world’s billions of poor, crowded into fetid slums. We do not see those who die from drinking contaminated water or being unable to afford medical care. We do not see those being foreclosed from their homes. We do not see the children who go to bed hungry. We busy ourselves with the absurd. We invest our emotional life in reality shows that celebrate excess, hedonism and wealth. We are tempted by the opulent life enjoyed by the American oligarchy, 1 percent of whom control more wealth than the bottom 90 percent combined.
The celebrities and reality television stars whose foibles we know intimately live indolent, self-centered lives in sprawling mansions or exclusive Manhattan apartments. They parade their sculpted and surgically enhanced bodies before us in designer clothes. They devote their lives to self-promotion and personal advancement, consumption, parties and the making of money. They celebrate the cult of the self. And when they have meltdowns we watch with gruesome fascination. This empty existence is the one we are taught to admire and emulate. This is the life, we are told, we can all have. The perversion of values has created a landscape where corporate management by sleazy figures like Donald Trump is confused with leadership and where the ability to accumulate vast sums of money is confused with intelligence. And when we do glimpse the poor or working class on our screens, they are ridiculed and taunted. They are objects of contempt, whether on “The Jerry Springer Show” or “Jersey Shore.”
The incessant chasing after status, personal advancement and wealth has plunged most of the country into unmanageable debt. Families, whose real wages have dropped over the past three decades, live in oversized houses financed by mortgages they often cannot repay. They seek identity through products. They occupy their leisure time in malls buying things they do not need. Those of working age spend their weekdays in little cubicles, if they still have steady jobs, under the heels of corporations that have disempowered American workers and taken control of the state and can lay them off on a whim. It is a desperate scramble. No one wants to be left behind.
The propagandists for globalism are the natural outgrowth of this image-based and culturally illiterate world. They speak about economic and political theory in empty clichés. They cater to our subliminal and irrational desires. They select a few facts and isolated data and use them to dismiss historical, economic, political and cultural realities. They tell us what we want to believe about ourselves. They assure us that we are exceptional as individuals and as a nation. They champion our ignorance as knowledge. They tell us that there is no reason to investigate other ways of organizing and governing our society. Our way of life is the best. Capitalism has made us great. They peddle the self-delusional dream of inevitable human progress. They assure us we will be saved by science, technology and rationality and that humanity is moving inexorably forward.
None of this is true. It is a message that defies human nature and human history. But it is what many desperately want to believe. And until we awake from our collective self-delusion, until we carry out sustained acts of civil disobedience against the corporate state and sever ourselves from the liberal institutions that serve the corporate juggernaut—especially the Democratic Party—we will continue to be rocketed toward a global catastrophe.
Chris Hedges’ column appears every Monday at Truthdig. Hedges, a fellow at The Nation Institute and a Pulitzer Prize-winning journalist, is the author of “Death of the Liberal Class.”
Monday, March 28, 2011
March 25, 2011
A Shabby Crusade in Wisconsin
The latest technique used by conservatives to silence liberal academics is to demand copies of e-mails and other documents. Attorney General Kenneth Cuccinelli of Virginia tried it last year with a climate-change scientist, and now the Wisconsin Republican Party is doing it to a distinguished historian who dared to criticize the state’s new union-busting law. These demands not only abuse academic freedom, but make the instigators look like petty and medieval inquisitors.
The historian, William Cronon, is the Frederick Jackson Turner and Vilas research professor of history, geography and environmental studies at the University of Wisconsin, and was recently elected president of the American Historical Association. Earlier this month, he was asked to write an Op-Ed article for The Times on the historical context of Gov. Scott Walker’s effort to strip public-employee unions of bargaining rights. While researching the subject, he posted on his blog several critical observations about the powerful network of conservatives working to undermine union rights and disenfranchise Democratic voters in many states.
In particular, he pointed to the American Legislative Exchange Council, a conservative group backed by business interests that circulates draft legislation in every state capital, much of it similar to the Wisconsin law, and all of it unmatched by the left. Two days later, the state Republican Party filed a freedom-of-information request with the university, demanding all of his e-mails containing the words “Republican,” “Scott Walker,” “union,” “rally,” and other such incendiary terms. (The Op-Ed article appeared five days after that.)
The party refuses to say why it wants the messages; Mr. Cronon believes it is hoping to find that he is supporting the recall of Republican state senators, which would be against university policy and which he denies. This is a clear attempt to punish a critic and make other academics think twice before using the freedom of the American university to conduct legitimate research.
Professors are not just ordinary state employees. As J. Harvie Wilkinson III, a conservative federal judge on the Fourth Circuit Court of Appeals, noted in a similar case, state university faculty members are “employed professionally to test ideas and propose solutions, to deepen knowledge and refresh perspectives.” A political fishing expedition through a professor’s files would make it substantially harder to conduct research and communicate openly with colleagues. And it makes the Republican Party appear both vengeful and ridiculous.
Friday, March 25, 2011
March 24, 2011
The Austerity Delusion
By PAUL KRUGMAN
Portugal’s government has just fallen in a dispute over austerity proposals. Irish bond yields have topped 10 percent for the first time. And the British government has just marked its economic forecast down and its deficit forecast up.
What do these events have in common? They’re all evidence that slashing spending in the face of high unemployment is a mistake. Austerity advocates predicted that spending cuts would bring quick dividends in the form of rising confidence, and that there would be few, if any, adverse effects on growth and jobs; but they were wrong.
It’s too bad, then, that these days you’re not considered serious in Washington unless you profess allegiance to the same doctrine that’s failing so dismally in Europe.
It was not always thus. Two years ago, faced with soaring unemployment and large budget deficits — both the consequences of a severe financial crisis — most advanced-country leaders seemingly understood that the problems had to be tackled in sequence, with an immediate focus on creating jobs combined with a long-run strategy of deficit reduction.
Why not slash deficits immediately? Because tax increases and cuts in government spending would depress economies further, worsening unemployment. And cutting spending in a deeply depressed economy is largely self-defeating even in purely fiscal terms: any savings achieved at the front end are partly offset by lower revenue, as the economy shrinks.
So jobs now, deficits later was and is the right strategy. Unfortunately, it’s a strategy that has been abandoned in the face of phantom risks and delusional hopes. On one side, we’re constantly told that if we don’t slash spending immediately we’ll end up just like Greece, unable to borrow except at exorbitant interest rates. On the other, we’re told not to worry about the impact of spending cuts on jobs because fiscal austerity will actually create jobs by raising confidence.
How’s that story working out so far?
Self-styled deficit hawks have been crying wolf over U.S. interest rates more or less continuously since the financial crisis began to ease, taking every uptick in rates as a sign that markets were turning on America. But the truth is that rates have fluctuated, not with debt fears, but with rising and falling hope for economic recovery. And with full recovery still seeming very distant, rates are lower now than they were two years ago.
But couldn’t America still end up like Greece? Yes, of course. If investors decide that we’re a banana republic whose politicians can’t or won’t come to grips with long-term problems, they will indeed stop buying our debt. But that’s not a prospect that hinges, one way or another, on whether we punish ourselves with short-run spending cuts.
Just ask the Irish, whose government — having taken on an unsustainable debt burden by trying to bail out runaway banks — tried to reassure markets by imposing savage austerity measures on ordinary citizens. The same people urging spending cuts on America cheered. “Ireland offers an admirable lesson in fiscal responsibility,” declared Alan Reynolds of the Cato Institute, who said that the spending cuts had removed fears over Irish solvency and predicted rapid economic recovery.
That was in June 2009. Since then, the interest rate on Irish debt has doubled; Ireland’s unemployment rate now stands at 13.5 percent.
And then there’s the British experience. Like America, Britain is still perceived as solvent by financial markets, giving it room to pursue a strategy of jobs first, deficits later. But the government of Prime Minister David Cameron chose instead to move to immediate, unforced austerity, in the belief that private spending would more than make up for the government’s pullback. As I like to put it, the Cameron plan was based on belief that the confidence fairy would make everything all right.
But she hasn’t: British growth has stalled, and the government has marked up its deficit projections as a result.
Which brings me back to what passes for budget debate in Washington these days.
A serious fiscal plan for America would address the long-run drivers of spending, above all health care costs, and it would almost certainly include some kind of tax increase. But we’re not serious: any talk of using Medicare funds effectively is met with shrieks of “death panels,” and the official G.O.P. position — barely challenged by Democrats — appears to be that nobody should ever pay higher taxes. Instead, all the talk is about short-run spending cuts.
In short, we have a political climate in which self-styled deficit hawks want to punish the unemployed even as they oppose any action that would address our long-run budget problems. And here’s what we know from experience abroad: The confidence fairy won’t save us from the consequences of our folly.
Wednesday, March 23, 2011
Those Useful Tyrants
Posted on Mar 21, 2011
By Eugene Robinson
Anyone looking for principle and logic in the attack on Moammar Gadhafi’s tyrannical regime will be disappointed. President Barack Obama and his advisers should acknowledge the obvious truth: They are reacting to the revolutionary fervor in the Arab world with the arbitrary “realism” that is a superpower’s prerogative.
Faced with an armed uprising by democracy-seeking rebels, Gadhafi threatened to turn all of Libya into a charnel house. The United States and its allies responded with overwhelming military force that is clearly intended to cripple the government and boost the revolt’s chances of success.
Thus begins our third concurrent Middle East war. No one has the slightest idea how, or when, this one will end.
I have to admit that I, too, would have found it hard to stand idly by as Gadhafi drenched the streets of Benghazi in blood. But what makes it any easier to watch other despots do the same thing?
In Yemen, forces loyal to dictator Ali Abdullah Saleh have slaughtered dozens of defenseless protesters seeking democratic reform. Saleh, who has ruled the nation for 33 years, clings desperately to power despite having been abandoned by many of his political supporters and some of his generals. He has shown nothing but defiance. “Every day we hear a statement from Obama saying, ‘Egypt you can’t do this, Tunisia don’t do that,’” Saleh said in a speech earlier this month. “Are you president of the United States, or president of the world?”
But there has been no U.S. military intervention. Saleh has been seen as a valuable ally in the fight against al-Qaida, which has perhaps its most active—and potentially dangerous—base in Yemen. Attacks against the United States have been planned and staged there. Saleh, therefore, is a useful tyrant. He gets nudges, not bombs.
In Bahrain, the ruling al-Khalifa royal family has responded to peaceful demonstrations with violent repression. While the world’s attention was focused on the unfolding tragedy in Japan and the looming tragedy in Libya, Bahrain’s leaders brutally cleared Pearl Square of its protest encampment and even destroyed the towering monument that had become the pro-democracy movement’s most powerful symbol.
But for Bahrain, too, we have polite words rather than decisive action. Why? Because the U.S. Navy’s 5th Fleet is based there, astride the Persian Gulf shipping lanes through which 40 percent of the world’s seaborne oil shipments must pass. The base gives the United States a way to counter Iran’s growing power.
Also, the Khalifas are close allies of the Saudi royals, who are desperate to keep the protests in Bahrain from spilling over into the nearby kingdom. The Saudi rulers sent troops to help crush the Bahrain demonstrations and have banned any kind of pro-democracy agitation at home. For the House of Saud, however, the White House has barely managed to choke out a tsk-tsk.
Why is Libya so different? Basically, because the dictators of Yemen, Bahrain and Saudi Arabia—also Jordan and the Persian Gulf sheikdoms, for that matter—are friendly, cooperative and useful. Gadhafi is not.
You will recall Secretary of State Hillary Clinton’s initial assessment that the regime of Egyptian strongman Hosni Mubarak was “stable.” We knew that Mubarak was brutal and corrupt, but only when it became clear that his hold on power was slipping—and that the Egyptian military establishment would not fire on peaceful Egyptian citizens—did the Obama administration position itself on the right side of history.
In explaining why the U.S. would join in establishing the Libya no-fly zone, which immediately became much more, Obama tied himself in rhetorical knots. If Gadhafi were to commit atrocities against his people, Obama said, “The entire region could be destabilized, endangering many of our allies and partners.” Well, duh. As he no doubt has noticed, the region is already destabilized. Friendly regimes are already being threatened, but not by Gadhafi. They are endangered by the democratic aspirations of their own people.
Gadhafi is crazy and evil; obviously, he wasn’t going to listen to our advice about democracy. The world would be fortunate to be rid of him. But war in Libya is justifiable only if we are going to hold compliant dictators to the same standard we set for defiant ones. If not, then please spare us all the homilies about universal rights and freedoms. We’ll know this isn’t about justice, it’s about power.
Eugene Robinson’s e-mail address is eugenerobinson(at)washpost.com.
© 2011, Washington Post Writers Group
Friday, March 18, 2011
March 17, 2011
The Forgotten Millions
By PAUL KRUGMAN
More than three years after we entered the worst economic slump since the 1930s, a strange and disturbing thing has happened to our political discourse: Washington has lost interest in the unemployed.
Jobs do get mentioned now and then — and a few political figures, notably Nancy Pelosi, the Democratic leader in the House, are still trying to get some kind of action. But no jobs bills have been introduced in Congress, no job-creation plans have been advanced by the White House and all the policy focus seems to be on spending cuts.
So one-sixth of America’s workers — all those who can’t find any job or are stuck with part-time work when they want a full-time job — have, in effect, been abandoned.
It might not be so bad if the jobless could expect to find new employment fairly soon. But unemployment has become a trap, one that’s very difficult to escape. There are almost five times as many unemployed workers as there are job openings; the average unemployed worker has been jobless for 37 weeks, a post-World War II record.
In short, we’re well on the way to creating a permanent underclass of the jobless. Why doesn’t Washington care?
Part of the answer may be that while those who are unemployed tend to stay unemployed, those who still have jobs are feeling more secure than they did a couple of years ago. Layoffs and discharges spiked during the crisis of 2008-2009 but have fallen sharply since then, perhaps reducing the sense of urgency. Put it this way: At this point, the U.S. economy is suffering from low hiring, not high firing, so things don’t look so bad — as long as you’re willing to write off the unemployed.
Yet polls indicate that voters still care much more about jobs than they do about the budget deficit. So it’s quite remarkable that inside the Beltway, it’s just the opposite.
What makes this even more remarkable is the fact that the economic arguments used to justify the D.C. deficit obsession have been repeatedly refuted by experience.
On one side, we’ve been warned, over and over again, that “bond vigilantes” will turn on the U.S. government unless we slash spending immediately. Yet interest rates remain low by historical standards; indeed, they’re lower now than they were in the spring of 2009, when those dire warnings began.
On the other side, we’ve been assured that spending cuts would do wonders for business confidence. But that hasn’t happened in any of the countries currently pursuing harsh austerity programs. Notably, when the Cameron government in Britain announced austerity measures last May, it received fawning praise from U.S. deficit hawks. But British business confidence plunged, and it has not recovered.
Yet the obsession with spending cuts flourishes all the same — unchallenged, it must be said, by the White House.
I still don’t know why the Obama administration was so quick to accept defeat in the war of ideas, but the fact is that it surrendered very early in the game. In early 2009, John Boehner, now the speaker of the House, was widely and rightly mocked for declaring that since families were suffering, the government should tighten its own belt. That’s Herbert Hoover economics, and it’s as wrong now as it was in the 1930s. But, in the 2010 State of the Union address, President Obama adopted exactly the same metaphor and began using it incessantly.
And earlier this week, the White House budget director declared: “There is an agreement that we should be reducing spending,” suggesting that his only quarrel with Republicans is over whether we should be cutting taxes, too. No wonder, then, that according to a new Pew Research Center poll, a majority of Americans see “not much difference” between Mr. Obama’s approach to the deficit and that of Republicans.
So who pays the price for this unfortunate bipartisanship? The increasingly hopeless unemployed, of course. And the worst hit will be young workers — a point made in 2009 by Peter Orszag, then the White House budget director. As he noted, young Americans who graduated during the severe recession of the early 1980s suffered permanent damage to their earnings. And if the average duration of unemployment is any indication, it’s even harder for new graduates to find decent jobs now than it was in 1982 or 1983.
So the next time you hear some Republican declaring that he’s concerned about deficits because he cares about his children — or, for that matter, the next time you hear Mr. Obama talk about winning the future — you should remember that the clear and present danger to the prospects of young Americans isn’t the deficit. It’s the absence of jobs.
But, as I said, these days Washington doesn’t seem to care about any of that. And you have to wonder what it will take to get politicians caring again about America’s forgotten millions.
Wednesday, March 16, 2011
Monday, March 14, 2011
March 13, 2011
Another Inside Job
By PAUL KRUGMAN
Count me among those who were glad to see the documentary “Inside Job” win an Oscar. The film reminded us that the financial crisis of 2008, whose aftereffects are still blighting the lives of millions of Americans, didn’t just happen — it was made possible by bad behavior on the part of bankers, regulators and, yes, economists.
What the film didn’t point out, however, is that the crisis has spawned a whole new set of abuses, many of them illegal as well as immoral. And leading political figures are, at long last, showing some outrage. Unfortunately, this outrage is directed, not at banking abuses, but at those trying to hold banks accountable for these abuses.
The immediate flashpoint is a proposed settlement between state attorneys general and the mortgage servicing industry. That settlement is a “shakedown,” says Senator Richard Shelby of Alabama. The money banks would be required to allot to mortgage modification would be “extorted,” declares The Wall Street Journal. And the bankers themselves warn that any action against them would place economic recovery at risk.
All of which goes to confirm that the rich are different from you and me: when they break the law, it’s the prosecutors who find themselves on trial.
To get an idea of what we’re talking about here, look at the complaint filed by Nevada’s attorney general against Bank of America. The complaint charges the bank with luring families into its loan-modification program — supposedly to help them keep their homes — under false pretenses; with giving false information about the program’s requirements (for example, telling them that they had to default on their mortgages before receiving a modification); with stringing families along with promises of action, then “sending foreclosure notices, scheduling auction dates, and even selling consumers’ homes while they waited for decisions”; and, in general, with exploiting the program to enrich itself at those families’ expense.
The end result, the complaint charges, was that “many Nevada consumers continued to make mortgage payments they could not afford, running through their savings, their retirement funds, or their children’s education funds. Additionally, due to Bank of America’s misleading assurances, consumers deferred short-sales and passed on other attempts to mitigate their losses. And they waited anxiously, month after month, calling Bank of America and submitting their paperwork again and again, not knowing whether or when they would lose their homes.”
Still, things like this only happen to losers who can’t keep up their mortgage payments, right? Wrong. Recently Dana Milbank, the Washington Post columnist, wrote about his own experience: a routine mortgage refinance with Citibank somehow turned into a nightmare of misquoted rates, improper interest charges, and frozen bank accounts. And all the evidence suggests that Mr. Milbank’s experience wasn’t unusual.
Notice, by the way, that we’re not talking about the business practices of fly-by-night operators; we’re talking about two of our three largest financial companies, with roughly $2 trillion each in assets. Yet politicians would have you believe that any attempt to get these abusive banking giants to make modest restitution is a “shakedown.” The only real question is whether the proposed settlement lets them off far too lightly.
What about the argument that placing any demand on the banks would endanger the recovery? There’s a lot to be said about that argument, none of it good. But let me emphasize two points.
First, the proposed settlement only calls for loan modifications that would produce a greater “net present value” than foreclosure — that is, for offering deals that are in the interest of both homeowners and investors. The outrageous truth is that in many cases banks are blocking such mutually beneficial deals, so that they can continue to extract fees. How could ending this highway robbery be bad for the economy?
Second, the biggest obstacle to recovery isn’t the financial condition of major banks, which were bailed out once and are now profiting from the widespread perception that they’ll be bailed out again if anything goes wrong. It is, instead, the overhang of household debt combined with paralysis in the housing market. Getting banks to clear up mortgage debts — instead of stringing families along to extract a few more dollars — would help, not hurt, the economy.
In the days and weeks ahead, we’ll see pro-banker politicians denounce the proposed settlement, asserting that it’s all about defending the rule of law. But what they’re actually defending is the exact opposite — a system in which only the little people have to obey the law, while the rich, and bankers especially, can cheat and defraud without consequences.
Thursday, March 10, 2011
I have never before been filled with so much hate; thanks to the thugs in control in Madison. These people have systematically disregarded the rights of citizens all over the state. Not only the social workers, nurses, teachers, public works employees, being stripped of their civil rights, but ALL the citizens who are yet too ignorant to realize how their state is racing toward the bottom, soon to be in competition for the last place honor with Mississippi.
There WILL BE retribution! What goes around comes around. When these sleazebags fall from power, which they most surely will, there will follow a massive movement to restore and recover from the damage they are inflicting on us now. Clearly, these republicans have no conscience and are somehow able to go home and face their families and communities and pretend they are “saving the state”. Are they truly that totally stupid? I’m afraid the answer is apparent.
I say its time to strike back. We need to identify the supporters of these criminals here in our communities and boycott them. I believe its safe to say that a good many so-called ‘small businessmen’ are supporters of this ilk. Let’s not be so foolish as to continue to support them with our business, and tolerance.
Wednesday, March 9, 2011
Sent from my iPhone
“Skepticism is the agent of reason against organized irrationalism—and is therefore one of the keys to human social and civic decency.”
—Stephen Jay Gould
Tuesday, March 8, 2011
How Many Afghan Kids Need to Die to Make the News?
The number of Afghan boys gathering firewood killed by a March 1 U.S./NATO helicopter attack in Kunar Province: Nine.
The number of stories about the killing of the nine children on ABC, CBS or NBC morning or evening news shows (as of March 6): Two.
One was an 80-word report on NBC Nightly News (3/2/11), the other a brief ABC World News Sunday story (3/6/11) about Afghan president Hamid Karzai's "harsh words for the U.S." after the "mistaken killing of nine Afghan boys in an airstrike."
On the PBS NewsHour? Two brief mentions (3/2/11, 3/7/11), both during the "other news of the day" segment.
On NPR? Nothing. On the"liberal" MSNBC? Zero. Fox News Channel? Zero.
CNN had several mentions of the killings. In one report (3/2/11), correspondent Michael Holmes remarked: "It does a lot of damage to the U.S. mission in Afghanistan. You don't win hearts and minds that way."
In the Washington Post (3/3/11), the children's deaths were called "the latest irritant" in the relationship between U.S./NATO forces and the Afghan government. Civilian casualties are "a sore point," and U.S. commander David Petraeus "has had to walk a fine line. Civilian casualties undermine NATO's counterinsurgency mission here by angering Afghan civilians and bolstering the Taliban's attempt to portray foreign troops as ruthless invaders."
In contrast to the corporate media, Democracy Now! (3/3/11) talked about the attack as part of the larger story of civilian deaths in Afghanistan. "It was at least the third instance in two weeks in which the Afghan government accused NATO forces of killing large numbers of civilians in airstrikes," host Juan Gonzalez noted in introducing a discussion. "An Afghan government panel is still investigating claims some 65 people, including 40 children, were killed in a U.S.-led attack last week."
It is often said that Afghanistan is largely a forgotten war--a critique usually meant as a comment on the lack of attention paid to the hardships of U.S. military personnel. Far less consideration is granted to the Afghans who are suffering in far greater numbers.
Monday, March 7, 2011
March 6, 2011
Degrees and Dollars
By PAUL KRUGMAN
It is a truth universally acknowledged that education is the key to economic success. Everyone knows that the jobs of the future will require ever higher levels of skill. That’s why, in an appearance Friday with former Florida Gov. Jeb Bush, President Obama declared that “If we want more good news on the jobs front then we’ve got to make more investments in education.”
But what everyone knows is wrong.
The day after the Obama-Bush event, The Times published an article about the growing use of software to perform legal research. Computers, it turns out, can quickly analyze millions of documents, cheaply performing a task that used to require armies of lawyers and paralegals. In this case, then, technological progress is actually reducing the demand for highly educated workers.
And legal research isn’t an isolated example. As the article points out, software has also been replacing engineers in such tasks as chip design. More broadly, the idea that modern technology eliminates only menial jobs, that well-educated workers are clear winners, may dominate popular discussion, but it’s actually decades out of date.
The fact is that since 1990 or so the U.S. job market has been characterized not by a general rise in the demand for skill, but by “hollowing out”: both high-wage and low-wage employment have grown rapidly, but medium-wage jobs — the kinds of jobs we count on to support a strong middle class — have lagged behind. And the hole in the middle has been getting wider: many of the high-wage occupations that grew rapidly in the 1990s have seen much slower growth recently, even as growth in low-wage employment has accelerated.
Why is this happening? The belief that education is becoming ever more important rests on the plausible-sounding notion that advances in technology increase job opportunities for those who work with information — loosely speaking, that computers help those who work with their minds, while hurting those who work with their hands.
Some years ago, however, the economists David Autor, Frank Levy and Richard Murnane argued that this was the wrong way to think about it. Computers, they pointed out, excel at routine tasks, “cognitive and manual tasks that can be accomplished by following explicit rules.” Therefore, any routine task — a category that includes many white-collar, nonmanual jobs — is in the firing line. Conversely, jobs that can’t be carried out by following explicit rules — a category that includes many kinds of manual labor, from truck drivers to janitors — will tend to grow even in the face of technological progress.
And here’s the thing: Most of the manual labor still being done in our economy seems to be of the kind that’s hard to automate. Notably, with production workers in manufacturing down to about 6 percent of U.S. employment, there aren’t many assembly-line jobs left to lose. Meanwhile, quite a lot of white-collar work currently carried out by well-educated, relatively well-paid workers may soon be computerized. Roombas are cute, but robot janitors are a long way off; computerized legal research and computer-aided medical diagnosis are already here.
And then there’s globalization. Once, only manufacturing workers needed to worry about competition from overseas, but the combination of computers and telecommunications has made it possible to provide many services at long range. And research by my Princeton colleagues Alan Blinder and Alan Krueger suggests that high-wage jobs performed by highly educated workers are, if anything, more “offshorable” than jobs done by low-paid, less-educated workers. If they’re right, growing international trade in services will further hollow out the U.S. job market.
So what does all this say about policy?
Yes, we need to fix American education. In particular, the inequalities Americans face at the starting line — bright children from poor families are less likely to finish college than much less able children of the affluent — aren’t just an outrage; they represent a huge waste of the nation’s human potential.
But there are things education can’t do. In particular, the notion that putting more kids through college can restore the middle-class society we used to have is wishful thinking. It’s no longer true that having a college degree guarantees that you’ll get a good job, and it’s becoming less true with each passing decade.
So if we want a society of broadly shared prosperity, education isn’t the answer — we’ll have to go about building that society directly. We need to restore the bargaining power that labor has lost over the last 30 years, so that ordinary workers as well as superstars have the power to bargain for good wages. We need to guarantee the essentials, above all health care, to every citizen.
What we can’t do is get where we need to go just by giving workers college degrees, which may be no more than tickets to jobs that don’t exist or don’t pay middle-class wages.
Saturday, March 5, 2011
Wednesday, March 2, 2011
Here’s an article that again to the concerns about corporate controlled media. The evening news programs continue to be ‘entertainment’ rather than the providing of complete facts… Have a read.
“ABC World News With Diane Sawyer kicked off its "Made in America" series on February 28, encouraging consumers to buy U.S.-made products in order to spur job growth. But why focus on consumers and not major corporations like ABC parent Disney, who are the ones who actually choose to manufacture products overseas?
The February 28 report consisted of reporter David Muir touring one family's home, discovering that the vast majority of the family's possessions are not made in the United States. Muir even checks the children's toys, only to discover that they are mostly made in China.
Consumers, of course, do not choose where the products offered in their local stores are manufactured. Instead of focusing on what consumers should do with their limited choices, why not focus on the much more powerful decisions made by major corporations--like Disney? FAIR founder Jeff Cohen (CommonDreams, 2/27/11) checked the label at the Disney Store website:
What would be more helpful is a TV news series that scrutinizes the powerful U.S. corporations that make decisions every day determining what products mainstream Americans have access to.
I scrutinized Disney myself by going to DisneyStore.com -- "Official Site for Disney Merchandise." The first 40 products I looked at were all listed as "Imported."
As Muir put it at the close of the segment, "Economists say if we spent 1 percent more than what we're spending now on American goods, we could create 200,000 jobs immediately."
"That's 18 cents a day!" anchor Diane Sawyer exclaimed. The following night (3/1/11) Sawyer reiterated that point, telling viewers that spending just $64 a year will create 200,000 U.S. jobs.
Why is the focus on consumers--and not corporations? Will the ABC series talk about Disney, whose reliance on cheap labor is well-documented? The company's history is not encouraging. As FAIR pointed out (Action Alert, 11/20/00), ABC News killed critical investigations into Disney theme parks and sweatshops, evidence of a larger pattern:
One ABC producer says that the need to avoid news stories that might displease Disney "comes up all the time" because "no one here wants to piss off the bosses" (New Yorker, 8/14/00).
The closest ABC came on February 28 to mentioning Disney was noting that the family being profiled lives on Snow White Drive.”
Sent from my iPhone
Tuesday, March 1, 2011
As I grew up in the 50’s it was the communist threat that we were warned about. That was continued as the 60’s saw this country embroiled in another war we chose to enter to “deter the domino effect of the communist movement”. Again, history has shown the folly of that decision. For the next two decades we were told the ‘cold war’ demanded our obscene investment in the same military/industrial complex that Dwight Eisenhower had warned us about as he left office. Fear of the communist threat was again the rational for enriching the elite corporations that have now grown to control our government. (So who was the REAL threat?)
It’s probably not necessary to elaborate further on the many lies and deceptions that justified our entry into a war in the middle east that continues to roll on, now as the longest war we ever engaged in; once again, enriching the very people and corporations who lied to us about the need for the war in the first place! how is it that the citizenry continues to accept this ongoing propaganda campaign when there are ACTUAL threats present within our borders now! And I’m not talking about some Islamophobic plot.
Right here in Wisconsin we currently have a REAL and ACTUAL threat bearing down on the freedoms of the middle class; and somehow the perpetrators of this threat have managed to convince large numbers of people, using tea party tactics, to carry water for the oligarchy and its attempts to seize even more control! Governor Scott Walker, in his short two months in office has done more to create and fuel social discontent than any of his predecessors in the past 150+ years. He is demonstrably a mere pawn in the hands of the moneyed elites (read Koch brothers, Rupert Murdock, et. al.) to destroy our government from the inside…. The same crime the poorly organized communist movement in this country was accused of for so many years.
So where’s the outcry!