Whee, it's great to be a billionaire! You can do good and make even more money at the same time! I'm writing about Warren Buffett: he sinks $5 billion into Bank of America preferred stock, which pays a guaranteed 6% dividend, gets a warrant for buying 700 million more shares at $7.14: the stock opens at $8.29 and still closes at $7.65.
Buffett supported a bank that has a legion of lawsuits against it for it’s alleged fraudulent mortgage vehicles; it lost 36% of its stock value because of its overexposure to those same mortgages, made worse by the continued decline of the housing market, and its over-investment in European sovereign debt: Greece, Ireland, etc.
Buffett is viewed as doing the administration a favor, by helping to rescue a bank that looked as if it might lead to a replay of 2008. Credit Default Swaps on BAC had reached higher spreads than it faced in 2008-09 at the height of the financial panic.
So, Warren Buffett is not only a rich man getting richer, he's a hero to the administration, especially since he just advocated (in a New York Times op ed) that Congress should raise taxes on people like him. If he weren't so old, perhaps Obama should ask him to run for Vice President, or other Democrats might urge him to run against Obama.
Billionaires. Have you noticed that billionaires seem to be taking over our politics? On the "left" we have Warren, George Soros and… (are there any others?), in the center there is Michael Bloomberg, and on the far right there are the Koch brothers, among many, many others.
Does that tell you something?
One of our two political parties refuses to raise taxes on the wealthy. On the other hand, the GOP wants, in effect, to raise taxes on the middle class. It advocates discontinuing the payroll tax cut put in place last year to stimulate the economy, while insisting on extending the Bush tax cuts permanently.
The Bush tax cuts disproportionately favor the wealthy, which is one of the reasons why there is such a proliferation of billionaires, and other super-wealthy. Not only are the top tax rates the lowest they've been since the 1920's, many dividends are exempt, and capital gains are taxed at less than half the top rate--lower than middle class incomes. On the other hand, the payroll tax is a flat tax with a cap at a bit over the first $100,000 of income. A cut in its rate disproportionately favors those earning under that, but, those with million dollar incomes only pay the tax on one-tenth of their income. The tax cut hardly matters to them, so, the GOP wants to scrap it. Why?
Perhaps to drive the nation back into recession, to enable Republicans to beat Obama, to dismantle the New Deal and to insure that the wealthy rule. The takeover of the new Roman Senators: it could happen here.
Showing posts with label bush tax cuts. Show all posts
Showing posts with label bush tax cuts. Show all posts
Friday, August 26, 2011
Thursday, May 26, 2011
The Predator Class
The Senators of the Late Roman Empire stole wealth from everyone: the peasants, the middle class, the Emperor and the army, by avoiding taxes, sheltering those who couldn't pay, then enslaving them, and engineering corrupt deals with the army and the government.
Our selfish class has escalated the plunder of the rest of us to an order of magnitude that makes Roman Senators look like petty criminals in comparison.
Fraud permeated the housing market that collapsed in 2007-8; it was endemic at every level. But, the profits and risk escalated with each additional layer of resold, insured, sliced, repackaged, resold "mortgage securities." And where did the original money come from, the funds that underlay this whole wobbly house of cards? Mortgage payments, an increasing number of which were either sub-prime or of questionable soundness, with their fraudulent enticements of low starter rates and escalating payments, no money down but higher and higher interest rates.
The money that underpinned the great mortgage bubble came from the poor, and working middle class. Through bank swindles on those loans, the people were tossed out of their homes and the banks were left holding huge numbers of foreclosed properties.
This wasn't a great deal for the banks, initially, but before the crash, it transferred billions of dollars from the poor and near poor to the very, very rich. In the bailouts, the government handed the banks billions more, so that even if they were left holding hundreds of thousands of homes they couldn't sell, they were able to resume their speculation and create huge profits, mostly out of thin air--and made-up money.
As for the people thrown out of their homes, in many cases for clearly fraudulent reasons, they had nowhere to go. So, the collapse of the housing market, and of the financial system, threw millions out of work. But the so-called stimulus that was supposed to promote job creation--the green jobs touted by candidate Obama--was much too small, due to political timidity, to do much more than keep employment from falling off a cliff. It stabilized unemployment at below 10%. Since, it has slowly crept down to 9% or slightly lower (not counting discouraged workers).
Meanwhile, the bailed-out banks are profiting hugely, in the still largely unregulated financial markets. Corporations are posting huge profits, too, but hiring is very slow: employers would rather squeeze as much as they can out of existing employees.
As if to underline their client status to the banks and corporations, Republicans consistently advocate cutting corporate and high-earner taxes, while bewailing the huge debts incurred from similar tax cuts they adopted previously, and from their unfunded wars. To make up the difference, they propose draconian cuts to entitlements (running surpluses, so far) and to all programs serving anyone not rich.
Debtors prison has already resurfaced: will Republicans try to legalize serfdom next?
Our selfish class has escalated the plunder of the rest of us to an order of magnitude that makes Roman Senators look like petty criminals in comparison.
Fraud permeated the housing market that collapsed in 2007-8; it was endemic at every level. But, the profits and risk escalated with each additional layer of resold, insured, sliced, repackaged, resold "mortgage securities." And where did the original money come from, the funds that underlay this whole wobbly house of cards? Mortgage payments, an increasing number of which were either sub-prime or of questionable soundness, with their fraudulent enticements of low starter rates and escalating payments, no money down but higher and higher interest rates.
The money that underpinned the great mortgage bubble came from the poor, and working middle class. Through bank swindles on those loans, the people were tossed out of their homes and the banks were left holding huge numbers of foreclosed properties.
This wasn't a great deal for the banks, initially, but before the crash, it transferred billions of dollars from the poor and near poor to the very, very rich. In the bailouts, the government handed the banks billions more, so that even if they were left holding hundreds of thousands of homes they couldn't sell, they were able to resume their speculation and create huge profits, mostly out of thin air--and made-up money.
As for the people thrown out of their homes, in many cases for clearly fraudulent reasons, they had nowhere to go. So, the collapse of the housing market, and of the financial system, threw millions out of work. But the so-called stimulus that was supposed to promote job creation--the green jobs touted by candidate Obama--was much too small, due to political timidity, to do much more than keep employment from falling off a cliff. It stabilized unemployment at below 10%. Since, it has slowly crept down to 9% or slightly lower (not counting discouraged workers).
Meanwhile, the bailed-out banks are profiting hugely, in the still largely unregulated financial markets. Corporations are posting huge profits, too, but hiring is very slow: employers would rather squeeze as much as they can out of existing employees.
As if to underline their client status to the banks and corporations, Republicans consistently advocate cutting corporate and high-earner taxes, while bewailing the huge debts incurred from similar tax cuts they adopted previously, and from their unfunded wars. To make up the difference, they propose draconian cuts to entitlements (running surpluses, so far) and to all programs serving anyone not rich.
Debtors prison has already resurfaced: will Republicans try to legalize serfdom next?
Wednesday, December 29, 2010
Roman Senators: 400 AD, 2010-2011 AD
They're much the same. Roman Senators in fifth century Rome were the wealthy elite; they had formal titles; our elite does not. There are no legal disabilities and privileges dividing society, as there were in the fifth century, but it hardly matters.
In both eras, the dominant "Senators" constructed schemes to loot the wealth everyone else produced. Maybe it was a natural outgrowth of the Roman Empire's conquest-slave society. But it's happened here especially with the explosion of the financial sector--supported by empire, the US and wealthy nation's national banks.
Alan Greenspan helped create the casino financial system, opening the door to Wall Street's "inventions," like Credit Default Swaps, and even, variable interest mortgages, encouraging homeowners to cash in, to gamble, or buy ATV's.
In Roman times, Senators arranged it so they could collect everyone else's taxes, while avoiding taxes themselves. They used their positions and connections in the Imperial bureaucracy to collect all the gold, land and slaves in the empire, impoverishing everyone else. In the US, today, Warren Buffet and his hedge fund colleagues pay taxes, but despite the many millions they earn, they pay at about half the rate of ordinary Americans. Obama and Congress just extended low income tax rates for the wealthy, who already pay lower rates on capital gains, interest, and payroll taxes. They’ve cornered most of the new wealth created since 1975.
In the US, the Fed creates money for the elite: it's been expanding the money supply for decades. Why for the elite? Low interest rates--virtually zero for the banks--allow them to make cost-free profits on the rest of us. Have you ever borrowed money at zero interest? Further, cheap money induces fools (like me) into the stock market, but the sophisticated traders, the ones with "algorithms" and computer programs--and lots of virtually free capital--are the ones who walk away with profits. The rest of us buy high, sell low, and enrich our brokers with fees.
Of course, Wall Street isn't the only reason why US wealth concentrated at a staggering rate since the 1970's. There was the Reagan "revolution," the proliferation of conservative "think tanks" (propaganda sites now fueling Fox News) the Clinton collaboration, W's triumph, and now Obama's compromise/capitulation. With the important exception of Clinton's tax hike on the wealthy, all the rules, all the financial innovations, all the dilution of regulations, were directed toward the enrichment of a tiny elite.
And it has prospered. Wall Street, after the massive government bailouts of 2007-8, has sucked in greater profits, largely from gambling with government money, than it ever did before: in the midst of the Great Recession, with 9.6-18% unemployment, job insecurity, and banks gambling, instead of lending.
We're not out of recession, but we're on our way to another bubble crash. The elite, like 5th century Roman Senators, could capture all the wealth.
In both eras, the dominant "Senators" constructed schemes to loot the wealth everyone else produced. Maybe it was a natural outgrowth of the Roman Empire's conquest-slave society. But it's happened here especially with the explosion of the financial sector--supported by empire, the US and wealthy nation's national banks.
Alan Greenspan helped create the casino financial system, opening the door to Wall Street's "inventions," like Credit Default Swaps, and even, variable interest mortgages, encouraging homeowners to cash in, to gamble, or buy ATV's.
In Roman times, Senators arranged it so they could collect everyone else's taxes, while avoiding taxes themselves. They used their positions and connections in the Imperial bureaucracy to collect all the gold, land and slaves in the empire, impoverishing everyone else. In the US, today, Warren Buffet and his hedge fund colleagues pay taxes, but despite the many millions they earn, they pay at about half the rate of ordinary Americans. Obama and Congress just extended low income tax rates for the wealthy, who already pay lower rates on capital gains, interest, and payroll taxes. They’ve cornered most of the new wealth created since 1975.
In the US, the Fed creates money for the elite: it's been expanding the money supply for decades. Why for the elite? Low interest rates--virtually zero for the banks--allow them to make cost-free profits on the rest of us. Have you ever borrowed money at zero interest? Further, cheap money induces fools (like me) into the stock market, but the sophisticated traders, the ones with "algorithms" and computer programs--and lots of virtually free capital--are the ones who walk away with profits. The rest of us buy high, sell low, and enrich our brokers with fees.
Of course, Wall Street isn't the only reason why US wealth concentrated at a staggering rate since the 1970's. There was the Reagan "revolution," the proliferation of conservative "think tanks" (propaganda sites now fueling Fox News) the Clinton collaboration, W's triumph, and now Obama's compromise/capitulation. With the important exception of Clinton's tax hike on the wealthy, all the rules, all the financial innovations, all the dilution of regulations, were directed toward the enrichment of a tiny elite.
And it has prospered. Wall Street, after the massive government bailouts of 2007-8, has sucked in greater profits, largely from gambling with government money, than it ever did before: in the midst of the Great Recession, with 9.6-18% unemployment, job insecurity, and banks gambling, instead of lending.
We're not out of recession, but we're on our way to another bubble crash. The elite, like 5th century Roman Senators, could capture all the wealth.
Tuesday, September 28, 2010
This Age of Lunacy
$25.99 x 9,500=$246,905. Pretty good for a book that's just been published: that's the figure the publisher should take in from the Defense Department, which has bought all available copies of the first edition--to destroy them! The book: Operation Dark Heart, by Lt. Col. Anthony Shaffer.
As Col. Shaffer remarked: it's "ludicrous"--in this digital age--to think that the Defense Department, by buying 9500 copies, is going to eliminate all copies with questionable, supposedly classified information. The second printing does have many redactions, in some cases whole paragraphs, but meanwhile: at least one seller on eBay, claiming to have a first-edition printing, is asking nearly $2,000 for it. And you know, from Col. Shaffer's remark, that there are probably un-redacted copies flying around the Internet.
Oh, not to worry! DOD has money to burn, even if everyone else has to deal with slashed budgets. After all, after the Republicans get over their snit re Don't Ask Don't Tell, they'll probably want to raise the Defense Budget, and insure that we never withdraw from anywhere.
Of course, they'll complain that the government's deficit is going through the roof. Then, they'll say we've got to cut Social Security benefits--which are paid for through the payroll tax and the trust fund. Defense is paid through general revenue. And they'll say we've got to stop any stimulus spending, and any welfare spending: let the unemployed go jump off bridges! Let the poor (now on Medicaid) get sick and die!
So, we have 9.6% official unemployment, which is probably 17% when "discouraged workers" and involuntary part-time workers are counted. The right-wing seems to be saying: we can do nothing; we should be doing nothing. What's extraordinary is that their candidates still lead in the polls, especially, when Republicans insist that even the millionaires and billionaires should get tax cuts--and declare: everyone's taxes will rise unless the billionaires get tax cuts, too!
The best part is: we'll borrow the money from the Chinese, to make up for the shortfall of $700 billion that millionaires and billionaires will use to invest in--"emerging markets," i.e. countries like China, which is "where the growth is."
Chinese workers are only beginning to organize to demand better wages and working conditions. Americans? We're watching football, or reality shows, or worrying whether Lindsey Lohan will really stop drinking. Whadda we know about what's going on?
In besieged ancient Cirta, the Roman governor feared that closing the coliseum's games would drive citizens to riot. So, they continued, even as the Vandals broke through the city's walls. Vandals killed or enslaved virtually all of Cirta's Roman citizens.
We have our own age of lunacy, but it does have ancient parallels.
As Col. Shaffer remarked: it's "ludicrous"--in this digital age--to think that the Defense Department, by buying 9500 copies, is going to eliminate all copies with questionable, supposedly classified information. The second printing does have many redactions, in some cases whole paragraphs, but meanwhile: at least one seller on eBay, claiming to have a first-edition printing, is asking nearly $2,000 for it. And you know, from Col. Shaffer's remark, that there are probably un-redacted copies flying around the Internet.
Oh, not to worry! DOD has money to burn, even if everyone else has to deal with slashed budgets. After all, after the Republicans get over their snit re Don't Ask Don't Tell, they'll probably want to raise the Defense Budget, and insure that we never withdraw from anywhere.
Of course, they'll complain that the government's deficit is going through the roof. Then, they'll say we've got to cut Social Security benefits--which are paid for through the payroll tax and the trust fund. Defense is paid through general revenue. And they'll say we've got to stop any stimulus spending, and any welfare spending: let the unemployed go jump off bridges! Let the poor (now on Medicaid) get sick and die!
So, we have 9.6% official unemployment, which is probably 17% when "discouraged workers" and involuntary part-time workers are counted. The right-wing seems to be saying: we can do nothing; we should be doing nothing. What's extraordinary is that their candidates still lead in the polls, especially, when Republicans insist that even the millionaires and billionaires should get tax cuts--and declare: everyone's taxes will rise unless the billionaires get tax cuts, too!
The best part is: we'll borrow the money from the Chinese, to make up for the shortfall of $700 billion that millionaires and billionaires will use to invest in--"emerging markets," i.e. countries like China, which is "where the growth is."
Chinese workers are only beginning to organize to demand better wages and working conditions. Americans? We're watching football, or reality shows, or worrying whether Lindsey Lohan will really stop drinking. Whadda we know about what's going on?
In besieged ancient Cirta, the Roman governor feared that closing the coliseum's games would drive citizens to riot. So, they continued, even as the Vandals broke through the city's walls. Vandals killed or enslaved virtually all of Cirta's Roman citizens.
We have our own age of lunacy, but it does have ancient parallels.
Thursday, September 16, 2010
Small Business's #1 Worry?
A survey of small businessmen by the National Federation of Independent Business found: it's not taxes, and it's not credit. It's no customers.
So, the political dialogue about taxes or credit is less relevant to them than anything that would increase demand, like accelerating job creation. So, here are Democrats saying middle income tax cuts ought to be preserved, and Republicans insisting tax cuts for the wealthy not only must be maintained, but made permanent--at a cost of $700-800 billion to the debt--because, they insist some are small business proprietors--though few are). In addition, Democrats (with one Republican) have just passed similar bills in House and Senate, providing tax cuts and extended loans to small businesses: to spur hiring. But they probably won't have much effect.
What no one, either in the administration, or in either party, or either chamber, seems to get is this: people need jobs; business needs employed people; but businesses aren't employing them. So, what's the problem? Has government never acted as temporary employer of last resort before?
There are many areas where government could meet huge needs. The unemployed don't have to have jobs digging holes and filling them. We no longer allow heavy manual labor--we have machines for that, which costs more money and skills--but we could use clean up crews, teachers assistants, parking meter attendants, construction workers to repair and rebuild, and so on. Local governments could manage local projects.
If people are so concerned about illegal immigration, then they should go to work bringing in harvests, following crops northward; maybe the Feds could subsidize citizen workers.
The point is: what's holding up the recovery is a lack of jobs. Apparently, tinkering with loans, credits and taxes is not enough. Of course it isn't. Why would a business invest in higher output, by hiring more workers, or buying more machinery, when demand for the good or service they're trying to sell is so feeble and uncertain?
What are people thinking? The best and the brightest are pretty stupid.
When no one else creates jobs, government should be the employer of last resort. It can be. There are many things of lasting value that were built by the WPA, like the mural scenes in Post Offices, and the forest windbreaks planted by the CCC in the Great Plains; they stopped the dustbowl storms.
Yes, there would be a temporary hike to the deficit, but if there are no jobs, deficits will march off into the future--no jobs mean no taxes paid, and welfare or basic survival costs to pay for--or the costs of a repressive police state to keep down the growing, angry underclass, for whom there are no jobs.
The latter sounds a bit like the late Roman Empire: the wealthy got wealthier and enslaved everyone else, until the whole system collapsed in the face of the barbarians.
So, the political dialogue about taxes or credit is less relevant to them than anything that would increase demand, like accelerating job creation. So, here are Democrats saying middle income tax cuts ought to be preserved, and Republicans insisting tax cuts for the wealthy not only must be maintained, but made permanent--at a cost of $700-800 billion to the debt--because, they insist some are small business proprietors--though few are). In addition, Democrats (with one Republican) have just passed similar bills in House and Senate, providing tax cuts and extended loans to small businesses: to spur hiring. But they probably won't have much effect.
What no one, either in the administration, or in either party, or either chamber, seems to get is this: people need jobs; business needs employed people; but businesses aren't employing them. So, what's the problem? Has government never acted as temporary employer of last resort before?
There are many areas where government could meet huge needs. The unemployed don't have to have jobs digging holes and filling them. We no longer allow heavy manual labor--we have machines for that, which costs more money and skills--but we could use clean up crews, teachers assistants, parking meter attendants, construction workers to repair and rebuild, and so on. Local governments could manage local projects.
If people are so concerned about illegal immigration, then they should go to work bringing in harvests, following crops northward; maybe the Feds could subsidize citizen workers.
The point is: what's holding up the recovery is a lack of jobs. Apparently, tinkering with loans, credits and taxes is not enough. Of course it isn't. Why would a business invest in higher output, by hiring more workers, or buying more machinery, when demand for the good or service they're trying to sell is so feeble and uncertain?
What are people thinking? The best and the brightest are pretty stupid.
When no one else creates jobs, government should be the employer of last resort. It can be. There are many things of lasting value that were built by the WPA, like the mural scenes in Post Offices, and the forest windbreaks planted by the CCC in the Great Plains; they stopped the dustbowl storms.
Yes, there would be a temporary hike to the deficit, but if there are no jobs, deficits will march off into the future--no jobs mean no taxes paid, and welfare or basic survival costs to pay for--or the costs of a repressive police state to keep down the growing, angry underclass, for whom there are no jobs.
The latter sounds a bit like the late Roman Empire: the wealthy got wealthier and enslaved everyone else, until the whole system collapsed in the face of the barbarians.
Thursday, September 9, 2010
Playing Cynical Politics
Politicians play politics as naturally as the Pope says Mass, but there is a difference between above-board and cynical politics. Now, both sides are playing both.
In above-board politics, a politician will push for what he's really for, whether it's tax-cuts or new taxes, more oil-drilling in the Gulf, or stopping it cold.
The dialog on tax cuts is fairly straightforward: the Republicans are for making the Bush tax cuts permanent, since they have enriched their primary constituency (and campaign funders), the very wealthy. The increase in holdings of the top 1% of income classes, and even the top 0.1% since Bush cut taxes is phenomenal.
Obama is also straightforward when he opposes the extension of tax-cuts for the wealthy: an extension would cost $700 billion in the next ten years; he needs those funds to bring down the deficits; extending tax cuts would raise them. The wealthy are sitting on their riches, not investing in jobs, so losing those tax cuts shouldn't hurt job growth.
But Republicans are also against anything Obama proposes, including tax breaks they have championed for years for corporations. Why? Cynical politics. They are against any policy proposed by Obama, or Congressional Democrats. It doesn't matter if they were for precisely that policy beforehand: if he's for it, they're against it. This is true of Obama's healthcare, too. Most of the elements of the new law are similar to Massachusetts' health care law, signed by Republican Governor Mitt Romney--who now advocates repealing the national legislation!
Up until now, it looked as if Obama was trying to promote compromise, by incorporating Republican elements (as in the health care bill) to gain bipartisan support, but now he's playing cynical politics, too. His economic proposals are not really short-term stimulus programs: they are dares. Making the R&D tax credit permanent, would not generate many new jobs, although Obama claims it would, but it does call the Republicans' bluff.
Obama is about to call for a two-year corporate investment tax credit allowing 100% write offs on investments in plant and equipment. The R&D proposal would cost over $100 billion, the write offs could cost $300 billion.
But why would corporations invest in plant and equipment, when there is lagging demand for goods and services? So, they can lay off more workers, perhaps. Neither proposal would generate many jobs, but Republicans have advocated for both, yet will block both; they don't want Democrats to get the credit: (cynical politics).
Then, Obama could highlight their obstructionism and say; Republicans even block their own proposals to stimulate the economy. This is cynical politics: would Obama propose tax credits, if he thought they would pass?
Meanwhile, businesses squeeze profits from fewer workers and don't hire, while nearly 20% of the workforce isn't working.
Which cynical politics will work best?
In above-board politics, a politician will push for what he's really for, whether it's tax-cuts or new taxes, more oil-drilling in the Gulf, or stopping it cold.
The dialog on tax cuts is fairly straightforward: the Republicans are for making the Bush tax cuts permanent, since they have enriched their primary constituency (and campaign funders), the very wealthy. The increase in holdings of the top 1% of income classes, and even the top 0.1% since Bush cut taxes is phenomenal.
Obama is also straightforward when he opposes the extension of tax-cuts for the wealthy: an extension would cost $700 billion in the next ten years; he needs those funds to bring down the deficits; extending tax cuts would raise them. The wealthy are sitting on their riches, not investing in jobs, so losing those tax cuts shouldn't hurt job growth.
But Republicans are also against anything Obama proposes, including tax breaks they have championed for years for corporations. Why? Cynical politics. They are against any policy proposed by Obama, or Congressional Democrats. It doesn't matter if they were for precisely that policy beforehand: if he's for it, they're against it. This is true of Obama's healthcare, too. Most of the elements of the new law are similar to Massachusetts' health care law, signed by Republican Governor Mitt Romney--who now advocates repealing the national legislation!
Up until now, it looked as if Obama was trying to promote compromise, by incorporating Republican elements (as in the health care bill) to gain bipartisan support, but now he's playing cynical politics, too. His economic proposals are not really short-term stimulus programs: they are dares. Making the R&D tax credit permanent, would not generate many new jobs, although Obama claims it would, but it does call the Republicans' bluff.
Obama is about to call for a two-year corporate investment tax credit allowing 100% write offs on investments in plant and equipment. The R&D proposal would cost over $100 billion, the write offs could cost $300 billion.
But why would corporations invest in plant and equipment, when there is lagging demand for goods and services? So, they can lay off more workers, perhaps. Neither proposal would generate many jobs, but Republicans have advocated for both, yet will block both; they don't want Democrats to get the credit: (cynical politics).
Then, Obama could highlight their obstructionism and say; Republicans even block their own proposals to stimulate the economy. This is cynical politics: would Obama propose tax credits, if he thought they would pass?
Meanwhile, businesses squeeze profits from fewer workers and don't hire, while nearly 20% of the workforce isn't working.
Which cynical politics will work best?
Friday, August 20, 2010
People Don't Matter
That appears to be the predominant political economy of our day. Our unemployment rate remains high, and in fact may be much higher than the 9.5% cited by our government, but still, the movers and shakers (M's&S's) are debating how to cut the deficit.
First of all, now is not the time to cut deficits through austerity, because deficits can actually rise if unemployment, bankruptcies and foreclosures continue to rise. Austerity could contribute to higher unemployment, etc. and therefore not only lower tax revenues but also raise costs (more people looking for help).
The only way to cut government expenditures without a negative impact on jobs, housing and small business, would be to bring troops home from foreign parts, closing down foreign operations, like the wars in Iraq and Afghanistan, and some of the bases in 140 plus countries.
The M's&S's don't consider cutting our imperial adventures, however. What they are doing is: being niggardly about unemployment extensions, food stamps (Congress just cut next year's appropriation, despite a surge in applicants), and even tax credits for small business. What they are talking about are cuts to Social Security and Medicare, while Republicans are nearly unanimous about extending the Bush tax cuts, including those that have made the wealthy so much wealthier.
The argument they make about the latter: lower taxes will stimulate investment, is belied by lagging investment now, with those same low tax rates. Elites are sitting on their money, or paying $100+ million for Picassos, not investing in jobs. Investors will also invest in Brazil, or Russia, places where they'll get more of a return, until growth is restored here. Here, they'll park it in Treasuries, or gold.
Our unemployment rate may be twice as high as the 9.5% rate, when those without jobs for more than a year are included. Yet, all the (supposedly) liberal administration and Democratic Congress can do is add a little money here and there to keep things from getting dramatically worse. The Republicans' push for deficit cutting would make things worse, not better, but since Americans are unhappy with Democrats' half-measures, it looks increasingly likely that we'll go that route.
People don't matter, but corporate profits do. Big banks are now doing very well, and big corporations have found ways to squeeze profits out of job-cutting and foreign operations, so, they will resist taxes on the wealthy and government stimulus programs, and spend 100's of millions on campaigns to promote their positions.
The only hope would be if people see through the corporate agenda. Instead, millions worry about a Muslim community center two blocks from "Ground Zero!"
The global takeover by the extremely wealthy is proceeding. They are much like the Senators of Fifth Century Rome. Only an aroused populace can stop this.
First of all, now is not the time to cut deficits through austerity, because deficits can actually rise if unemployment, bankruptcies and foreclosures continue to rise. Austerity could contribute to higher unemployment, etc. and therefore not only lower tax revenues but also raise costs (more people looking for help).
The only way to cut government expenditures without a negative impact on jobs, housing and small business, would be to bring troops home from foreign parts, closing down foreign operations, like the wars in Iraq and Afghanistan, and some of the bases in 140 plus countries.
The M's&S's don't consider cutting our imperial adventures, however. What they are doing is: being niggardly about unemployment extensions, food stamps (Congress just cut next year's appropriation, despite a surge in applicants), and even tax credits for small business. What they are talking about are cuts to Social Security and Medicare, while Republicans are nearly unanimous about extending the Bush tax cuts, including those that have made the wealthy so much wealthier.
The argument they make about the latter: lower taxes will stimulate investment, is belied by lagging investment now, with those same low tax rates. Elites are sitting on their money, or paying $100+ million for Picassos, not investing in jobs. Investors will also invest in Brazil, or Russia, places where they'll get more of a return, until growth is restored here. Here, they'll park it in Treasuries, or gold.
Our unemployment rate may be twice as high as the 9.5% rate, when those without jobs for more than a year are included. Yet, all the (supposedly) liberal administration and Democratic Congress can do is add a little money here and there to keep things from getting dramatically worse. The Republicans' push for deficit cutting would make things worse, not better, but since Americans are unhappy with Democrats' half-measures, it looks increasingly likely that we'll go that route.
People don't matter, but corporate profits do. Big banks are now doing very well, and big corporations have found ways to squeeze profits out of job-cutting and foreign operations, so, they will resist taxes on the wealthy and government stimulus programs, and spend 100's of millions on campaigns to promote their positions.
The only hope would be if people see through the corporate agenda. Instead, millions worry about a Muslim community center two blocks from "Ground Zero!"
The global takeover by the extremely wealthy is proceeding. They are much like the Senators of Fifth Century Rome. Only an aroused populace can stop this.
Sunday, August 15, 2010
The G-20 and the Secret Police
I'm writing from Kitchener, Ontario. I was talking to a Canadian about how our government system (doesn't) work: he was amazed.
Ontario, was where the G-10 met. People are disturbed by what happened. The Liberal provincial government instituted secret police powers during the meeting, enabling the police to round up anyone they thought might make trouble--pre-emptive detention. Hundreds were imprisoned, simply for being in the wrong place at the wrong time. Apparently, almost anyone with a Quebec license plate was suspect.
There is much feeling here, especially in Montreal, that the G-20 has usurped the functions of the UN, and is little more than a conspiracy of the Great Powers to control the world, economically, militarily and politically. Montrealers have a point. As they see it, the powers were meeting to agree to cut services everywhere, in the face of the "Great Recession," and to protect the wealthy and large corporations, which have rebounded from the 2007-2008 debacle, while leaving most people behind (with large and rising unemployment). Obama was virtually alone in arguing for the need for more stimulus so that the largest economies could generate the employment needed to escape from the recession. He didn't come away with much.
So, back to the G-20 meeting: remember the clips of burning police cruisers? The provincial police abandoned scores of police vehicles on the streets. Another Ontarian remarked: they never abandon police cruisers. This was a set up, so the crazies could come and trash them, the media could get pictures of the destruction, and people could be persuaded that the police crack-down was necessary. Some are convinced that the crazies were either police saboteurs, or were encouraged by them.
Increasingly, it does look like a general consensus among world elites: let unemployment stay high; work your workers harder, don't hire, invest in laborsaving technology, instead. In addition, cut taxes on the wealthy, or, in the case of the US: keep them low, with the Bush tax-cuts.
There is one fly in their ointment, in the US, which brings us back to the crazy American system of government. Even if Tea Party Republicans gain seats, they won't be able to extend the Bush tax cuts: that would take 60 votes in the Senate--unless we let the Democrats sign on.
If the tax cuts expire, there will be a revenue bonanza. What progressives need to do is use that as leverage--for stimulus programs.
In the US, we have the makings of a true class struggle: the very rich against everyone else; tax cuts for people who already have enough--and refuse to invest in jobs--or money for jobs and a true greening of America. But in order for this to happen, a majority of Democratic Senators needs to realize: they could be popular heroes, if they only took a chance.
Otherwise, the Selfish Class has won: worldwide.
Ontario, was where the G-10 met. People are disturbed by what happened. The Liberal provincial government instituted secret police powers during the meeting, enabling the police to round up anyone they thought might make trouble--pre-emptive detention. Hundreds were imprisoned, simply for being in the wrong place at the wrong time. Apparently, almost anyone with a Quebec license plate was suspect.
There is much feeling here, especially in Montreal, that the G-20 has usurped the functions of the UN, and is little more than a conspiracy of the Great Powers to control the world, economically, militarily and politically. Montrealers have a point. As they see it, the powers were meeting to agree to cut services everywhere, in the face of the "Great Recession," and to protect the wealthy and large corporations, which have rebounded from the 2007-2008 debacle, while leaving most people behind (with large and rising unemployment). Obama was virtually alone in arguing for the need for more stimulus so that the largest economies could generate the employment needed to escape from the recession. He didn't come away with much.
So, back to the G-20 meeting: remember the clips of burning police cruisers? The provincial police abandoned scores of police vehicles on the streets. Another Ontarian remarked: they never abandon police cruisers. This was a set up, so the crazies could come and trash them, the media could get pictures of the destruction, and people could be persuaded that the police crack-down was necessary. Some are convinced that the crazies were either police saboteurs, or were encouraged by them.
Increasingly, it does look like a general consensus among world elites: let unemployment stay high; work your workers harder, don't hire, invest in laborsaving technology, instead. In addition, cut taxes on the wealthy, or, in the case of the US: keep them low, with the Bush tax-cuts.
There is one fly in their ointment, in the US, which brings us back to the crazy American system of government. Even if Tea Party Republicans gain seats, they won't be able to extend the Bush tax cuts: that would take 60 votes in the Senate--unless we let the Democrats sign on.
If the tax cuts expire, there will be a revenue bonanza. What progressives need to do is use that as leverage--for stimulus programs.
In the US, we have the makings of a true class struggle: the very rich against everyone else; tax cuts for people who already have enough--and refuse to invest in jobs--or money for jobs and a true greening of America. But in order for this to happen, a majority of Democratic Senators needs to realize: they could be popular heroes, if they only took a chance.
Otherwise, the Selfish Class has won: worldwide.
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