"The crash has laid bare many unpleasant truths about the United States. One of the most alarming, says a former chief economist of the International Monetary Fund, is that the finance industry has effectively captured our government—a state of affairs that more typically describes emerging markets, and is at the center of many emerging-market crises. If the IMF’s staff could speak freely about the U.S., it would tell us what it tells all countries in this situation: recovery will fail unless we break the financial oligarchy that is blocking essential reform. And if we are to prevent a true depression, we’re running out of time." Simon Johnson, the Atlantic 5/1/2009
"What went on at Lehman and AIG, as well as the chicanery in the CDO (collateralized debt obligations) business, by an sensible standard is criminal." Yves Smith: ECONned
The threat of defaulting on government obligations is a powerful weapon, especially in a complex, interconnected world economy. Devoted partisans can use it to disrupt government, to roil ordinary politics, to undermine policies they do not like, even to seek political revenge. Section Four was placed in the Constitution to remove this weapon from ordinary politics." – Jack Balkin, Yale University
"This recession was caused by the greed, recklessness, and illegal behavior on Wall Street. And, what makes people furious is that Wall Street still has not learned its lessons. Instead of investing in the job-creating productive economy providing affordable loans to small and medium-size businesses, the CEOs of the largest financial institutions in this country have created the largest gambling casino in the history of the world." Senator Bernie Sanders.
One, the economy is to serve the people and not the people to serve the economy. Two, development is about people and not about objects. Three, growth is not the same as development, and development does not necessarily require growth. Four, no economy is possible in the absence of ecosystem services. Five, the economy is a subsystem of a larger finite system, the biosphere, hence permanent growth is impossible. And the fundamental value to sustain a new economy should be that no economic interest, under no circumstance, can be above the reverence for life. ––Manfred Max-Neef
“When all the trees have been cut down, when all the animals have been hunted, when all the waters are polluted, when all the air is unsafe to breathe, only then will you discover you cannot eat money.” ~ Cree prophecy
Economic Justice (AFSC)
Post-Autistic Economics Network (what's wrong with economics.)
Report of the Commission on Inclusive Prosperity (1/2015) pdf
Goldman Secretly Bet on the U.S. Housing Crash
Robert Reich: structural changes (12/3/2009)
How to Fix The Economy (Prof Michael Hudson) 3/15/2009
Needed: A Fiscal Framework: Jeffrey Sachs (Scientific American: April 2009)
Video of Paul Krugman (about 6 minutes)
Bush's real problem with Eliot Spitzer (from Project Censored)
The Real Scandal of AIG (3/15/2009)
Russia Wants New International Reserve Currency (3/16/2009)
"You can have wealth concentrated in the hands of a few, or democracy, but you cannot have both." - Louis Brandeis
"The modern conservative is engaged in one of man's oldest exercises in moral philosophy: that is the search for a superior moral justification for selfishness." -- John Kenneth Galbraith
A dirty little secret everyone in Washington knows, or at least should. The vast majority of economists and budget analysts agree: The ship of state is on a disastrous course, and will founder on the reefs of economic disaster if nothing is done to correct it. David M. Walker the comptroller general of the United States. See www.gao.gov for details.
Time is long overdue to engage the conversation about how to move from a permanent war economy to a permanent peace economy. Seymour Melman’s 2003 article “In the Grip of a Permanent War Economy” clarifies this reality. From a letter from Mary Beth Sullivan which is more fully quoted on the war page.
Did you really believe that you could live, in the long term, on borrowed money ?
Who actually claimed that such a large nation doesn't need an industrial base ?
Where are the men and women who made us believe that a negative balance of trade is a sign of strength ?
Why did no one sound the alarm bell when the U.S. dollar became eroded and lost value for such a prolonged period ?
Is it possible that no one noticed a country that was once the biggest lender selling off its assets to others ?
How could the entrenchment of economic inequality in a democratic nation have been tolerated for so long ?
What happened to the upward mobility that was once this country's trademark ?
And, last but not least: why did democracy, which is supposed to react more quickly to malfunctions than other forms of government, fail so miserably ?
(from 'The War for Wealth' by Gabor Steingart...highly recommended).
Perspective on the Giveaway (12/20/2008 video)
Of Markets and Morality (12/4/2008)
Good Reasons to throw out the Republicans (8/14/2008) Joe Stiglitz
Economic Free Fall: William Greider (7/30/2008)
RBS Issues Global Stock and Credit Crash Alert By Ambrose Evans-Pritchard The Telegraph, London Wednesday, June 17, 2008 http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/18/cnrbs118.xml
Preventing a Financial Tsunami (9/4/08) Bill Gross
"Society must cease to look upon "progress" as something desirable. `Eternal Progress’ is a nonsensical myth. What must be implemented is not a `steadily expanding economy,’ but a zero growth economy, a stable economy. Economic growth is not only unnecessary but ruinous." Alexander I. Solzhenitsyn
Republicans often say that 'growth' can solve many of our economic problems. This is nonsense. Growth can cause further environmental degradation, unlimited devastation. If you doubt this see this video: The greatest shortcoming of the human race is the inability to understand the exponential function. Albert A. Bartlett, PhD, Emeritus Professor of Physics, University of Colorado.
"...we live in a world where economic growth is generally seen as both beneficent and necessary _ the more, the better; where past growth has brought us to a perilous state environmentally; where we are poised for unprecedented increments in growth; where this growth is proceeding with wildly wrong market signals, including prices that do not incorporate environmental costs or reflect the needs of future generations; where a failed politics has not meaningfully corrected the routinely deploying technology that was created in an environmentally unaware era; where there is no hidden hand or inherent mechanism adequate to correct the destructive tendencies. So, right now, one can only conclude that growth is the enemy of environment. Economy and environment remain in collision." The Bridge at the End of the World: Gus Speth (2008)
Speth also lists the kinds of pathological growth that can occur. (from the UNDP Human Development Report 1996)
See The Bridge at the End of the World: Gus Speth (2008)
of Growth: Richard Heinberg
"Trickle-down economics, which holds that so long as the economy as a whole grows everyone benefits, has been repeatedly shown to be wrong." Joseph Stiglitz, Making Globalization Work. Pg 23.
When You're in Jackson Hole, Stop Digging (8/18/2008) Dean Baker
Congress bailing out bankers...no help for homeowners (6/30/2008) Dean Baker
Dean Baker writes: "There are many other ways in which the government structures the market to redistribute income upward. Read my non-copyright protected book, The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer to get more of the picture."
Central Bank Body warns of Great Depression (6/9/2008)
Is this the big one ? From the Nation, April 14, 2008 issue.
Sorting through the rubble in post bubble America (March 9, 2008)
Stimulus is another scam (01/28/2008)
Fed releases crisis preparedness video. (3/3/2008)
Time to dump the Federal Reserve ? (02/21/2008)
Free-market fundamentalism—just as dangerous as the religious fundamentalisms of our day—trivializes the concern for public interest. The overwhelming power and influence of plutocrats and oligarchs in the economy put fear and insecurity in the hearts of anxiety-ridden workers and render money-driven, poll-obsessed elected officials deferential to corporate goals of profit, often at the cost of the common good. This illicit marriage of corporate and political elites—so blatant and flagrant in our time—not only undermines the trust of informed citizens in those who rule over them. It also promotes the pervasive sleepwalking of the populace, who see that the false prophets are handsomely rewarded with money, status, and access to more power. This profit-driven vision is sucking the democratic life out of American society.
In short, the dangerous dogma of free-market fundamentalism turns our attention away from schools to prisons, from workers’ conditions to profit margins, from health clinics to high-tech facial surgeries, from civic associations to pornographic Internet sites, and from children’s care to strip clubs. The fundamentalism of the market puts a premium on the activities of buying and selling, consuming and taking, promoting and advertising, and devalues community, compassionate charity, and improvement of the general quality of life. How ironic that in America we’ve moved so quickly from Martin Luther King Jr.’s “Let Freedom Ring!” to “Bling! Bling!”—as if freedom were reducible to simply having material toys, as dictated by free-market fundamentalism. Cornel West: Democracy Matters
Many Republicans think that the 'free' market is a beneficial way of determining our social direction or that it is somehow associated with democracy. It is not. Lack of planning, short-term profits, downsizing of R&D, starving infrastructure, plain old-fashioned corruption, and other mistakes (more below) also factored into the current economic collapse.
Capitalism works very well in Communist China, it does well under tyrannical dictatorships (see Naomi Klein's "Shock Doctrine"), and world-wide it weakens democracy. Since wages have been declining for a number of years, observe that investors and corporations have been winners at the expense of citizens. Robert Reich's book Supercapitalism explains this very well.
As consumers we can shop at Wal-Mart
and still know that their employees are poorly paid, ununionized, and lack benefits. We know
products, formerly made in good paying factories in this
country, are now made in third-world sweatshops. As a
consumer you may shop Wal-Mart thinking you are getting a good deal
at those low prices, as an investor you may be pleased that the
stock is doing well. As a citizen, you know it's a bad deal. Many of
their employees require public assistance.
Bush the First once called 'supply-side' economics, voodoo economics. That lower taxes would produce more Federal revenue was never true. Tax cuts were not only contrary to common sense, they ignored the costs of Bush's war adventures, and, contrary to Christian values, they rewarded the already wealthy at the expense of the poor. They converted the fundamentalist churches into a propaganda conduit for the Republican party. The war cost was put on the tab.
People no longer believe that their government serves them. Big money buys Congress and legislation keeps people in check. Union busting is accepted, citizens groups are out shouted by conglomerate media, the public loses influence, and democracy dies. That's how we come to be on a path to fascism.
To bestow the benefits of the Bill of Rights on Corporations, the Supreme Court ruled that Corporations are persons and they now have the full benefits of the Bill of Rights. The Bill of Rights for actual people is being shredded. Check out this.
In the interest of multinational corporations, we now have the largest military in the world.
Privatization removes activity from public accountability.
You do not have to look far to see that US corporate
governance needs reform. We should have a policy that considers
fairness and basic humanity. Compensation, for example, has displayed
Republican's think privatization is good policy. What it actually does is remove functions from public accountability, so it is anti-democratic. Result: Blackwater, Enron, prison-industrial complex, financial instability, consumer exploitation, or, worst of all is privatized vote counting. There is now considerable doubt about election integrity.
Privatization outcome: Jailing Kids for Cash. (2/18/2009)
Karl Marx was wrong when he predicted in an ideal world that the state would wither away. Republicans share this idea. The most successful economies are mixed. Government has functions that it must do, and the private sector has a domain in which it functions better. We need a discussion about just what is the correct mixture.
This may be an area best defined not only by economists, but
other stakeholders as well: The market functions best when there
are a lot of participants who are free to compete and quality
information is available to consumers. A small number of
corporations that dominate an industry do not necessarily make for
a efficient market These are, for example, not the conditions
for healthcare. You do not know which doctor has the best
performance record, you cannot know what their charges will be, and
you may get different assessments for the treatment that is right
for you. Insurance contracts for health care are generally not
transparent and they can change without notice.
Other developed countries have universal health care and that is one of the reasons why the global market is not a flat playing field.
Especially when their are few competitors, Government regulation is needed to assure that the market is orderly.
Why it is a bad idea to privatize government programs ?
Market fundamentalism has led to massive deregulation and now you can see the consequences: financial meltdown, bank failures, bad food, market scams, deceitful advertising, commercial lying, predatory lending, absurd CEO salaries, and a widening gap between rich and poor. Make no mistake though: deregulation can kill. as you can verify in lax workplace safety enforcement, unlabelled and unchecked food products, toxic toys, downer cows, or environmental degradation.
Deregulation has again led to out of control markets, bubbles, scams, corruption and ultimately to recession.
Bank deregulation led to reckless use of derivatives, predatory lending, and the subprime mess. Is it coincidental that Bush I had to bail out the Savings and Loan industry on his watch too ? The Glass-Steagle Act should be fully restored.
The visible results of the unregulated market include unsafe products, huge disparities in income that lead to walled communities, and could produce a new aristocracy and along with it a new feudalism.
Republicans have made regulatory agencies (like the FCC, FDA, EPA, SEC, etc) captives of the industries they are supposed to regulate. This allows corporations to serve their own interest instead of the public interest, it makes government dysfunctional and it assures continuation of our race for the bottom.
New Data on Inflation (January 16, 2008)
Bernanke's warning (January 13, 2008)
Impending Destruction of the US economy ( Paul Craig Roberts 11/28/2007)
Banks Gone Wild (Paul Krugman 11/23/2007)
Dollar could plunge by 90 percent (UPI 11/2007)
Double Digit inflation is here. (12/16/2007)
Dollar Collapse will cripple European economy (Paul Craig Roberts)
Republicans think that the market is a really good decision-making tool. Even better than democratically elected government. When making this argument they generally do not notice that an unfettered market will gladly sell drugs to your children, put workers in sweatshops, run prisons for profit, pollute the environment, deindustrialize the US, and more. Capitalism works very well in totalitarian contexts as is plainly evident from the many capitalist paradise dictatorships.
Income Gap Is Widening, Data Shows
Beat the Press: Dean Baker's commentary on economic reporting
Return of the Robber Barrons. (Paul Craig Roberts)
Senator Sanders vs Bush Nominee (video)
Richard Wolff, Ph.d Economics professor at the University of Massachusetts (video)
Shadow Stats reports on manipulated government reporting.
"What is a capitalist state? It is a state in which the principal means of production, such as farmland, real estate in the cities, the supply of water, gas, and electricity, public transportation, as well as the larger industrial plants are owned by a minority of the citizenry. Productivity is geared toward making a profit for the owners rather than providing the population with a uniform distribution of essential goods. This propertied minority dominates the rest of the population by dictating working conditions and controlling jobs in accordance with its interests. It dominates public opinion through its influence on schools, the press, government, and legislation. The harshness of this situation is sometimes tempered or at least disguised by a democratic form of government in which all citizens are guaranteed formal equality." Einstein around July 1945. From Einstein on Politics, Rowe and Schulmann
When Bush took office there were surpluses in the federal budget as far as the eye could see. How quickly that changed.
Job growth has not kept up with population growth as Corporations consolidate, downsize, and claim rights of personhood that were originally intended to protect poor minorities. Corporate media has become useless in providing adequate information to carry on a democracy. Wages have fallen as Corporations have moved to low wage countries, busted unions, cut benefits, and often have abandoned pensions.
Our poor children will pay with interest for Bush's folly. Already they are having to accept lower wage jobs with shrinking benefits. Pensions are disappearing, health expense is being shifted to them, tuition is skyrocketing, they are paying unprecedented rates for heavy credit card debt and income inequality is increasing fast. They have not yet lost Social Security but Republicans are working on it. They will have to fight the endless war that Bush provoked. In spite of clear warnings about climate change, there is little chance that greenhouse gas emissions will be mitigated any time soon.
To sustain their lifestyle, consumers have gone into heavy debt. Creative real estate financing their homes so that they can consume more now.
Since the Bush election campaign was funded by Corporate elite, it is not surprising that his regressive program was really about benefiting the already very comfortable. "Eighteen of America's wealthiest families, including the Timkens of Canton, are bankrolling efforts to permanently repeal estate taxes that would save their families a total of $71.6 billion, according to a report released by public interest groups".
Democracy, freedom, and the unregulated market are not compatible. As wealth is concentrated, only the powerful have voices in the media, money driven elections produce results for the oligopoly, gated communities with private security forces keep order for the wealthy, the legislative process slowly removes accountability from corporations, deregulation removes corporations further from democratic control. As privatization proceeds, more and more public concerns are removed from public accountability.
A stunning blow to democracy occurred when the Supreme Court ruled that corporations have personhood. Shareholders
do not have real voting rights in the current US corporatocracy.
Workers are not represented and they are experiencing relentless
downward pressure on their wages, benefits, and
Only when there are many competitors is there a free market. When a single company or a very small number of companies dominate a market, they can act in ways that do not serve the public. There are markets where privatization is dangerous, such as the one that delivers mercenarys. A large private army is a danger to our form of government. A small number of companies control US media and they are a danger to our information streams and, since they are all radically right wing, are undermining our democracy.
The US now has one of the most skewed income distributions. Expect more economic volatility since there are tsunami amounts amounts of speculative derivatives that can cause severe economic upset if the investment community is spooked at all. As one example, rising interest rates are already causing a cooling of the real estate market and a resulting loss of many jobs. Republicans have tightened bankruptcy laws. The Economy is in Crisis.
One of the symptoms of a banana republic is an elite class that rewards itself from massive debt. It is only an apparent prosperity. So it is that CEOs have continued to increase their pay by double digit percentages, that most of the benefits of tax cuts go to the topmost 1 %, war profiteering and loosely accounted public money are going to a select few corporations (which are tightly connected to senior Bush officials). Other regressive Bush policies include tax cuts, cuts in health care, welfare, Veterans Benefits, social security, labor, worker safety, environment, globalization. All of these reductions, along with systematic union busting, are at the expense of the US workers.
Many countries are diversifying their currency holdings away from the US dollar since it is visibly losing value and also from ill will. The consequence of hiding war expense have historically been associated with currency collapse. China, alone, holds more than $950 Billion in dollars...but it is diversifying.
While Bush partisans proclaim that the economy is healthy, most economists will tell you that such profligate deficit spending is not sustainable and will ultimately cause currency devaluation. It is not a matter of if...just when. Since Bush took office the economy lost 3,000,000 manufacturing jobs.
It is expensive to build an empire, and it is clear that healthcare and education are unaffordable as long as we have these global 'responsibilities'. When you think about it, it is healthcare and education that allow continued prosperity.
Our children will pay for the military buildup, misadventures, and ill will that Bush brought on us from the rest of the world. They will need to fight his endless war, they will inherit deep debt, ballooning tuition, interest expense, shredded social safety net, degraded environment, a reduced standard of living, corrupt government, an unchecked President, and sharply reduced civil liberties. They are not safer.
"Private capital tends to become concentrated in few hands, partly because of competition among the capitalists, and partly because technological development and the increasing division of labor encourage the formation of larger units of production at the expense of the smaller ones. The result of these developments is an oligarchy of private capital the enormous power of which cannot be effectively checked even by a democratically organized political society. This is true since the members of legislative bodies are selected by political parties, largely financed or otherwise influenced by private capitalists who, for all practical purposes, separate the electorate from the legislature. The consequence is that the representatives of the people do not in fact sufficiently protect the interests of the underprivileged sections of the population. Moreover, under existing conditions, private capitalists inevitably control, directly or indirectly, the main sources of information (press, radio, education). It is thus extremely difficult, and indeed in most cases quite impossible, for the individual citizen to come to objective conclusions and to make intelligent use of his political rights." Einstein on Politics, Rowe and Schulmann. Monthly Review, May 1949.
Naomi Klein If you think that the 'free market' and democracy are compatible try "Shock Doctrine", Naomi Klein's recent book.
"There's a very committed effort to convert the US into something resembling a Third World society, where a few people have enormous wealth and a lot of others have no security." Noam Chomsky Videos
Plunder: The Crime of Our Time (A documentary by Danny Schechter.)
Michael Albert (78 minutes) Remembering Tomorrow
Download Doug Henwood's free Book "Wall Street"