Austerity Bites Again

Christine LaGuarde, current head of the IMF is having second thoughts about austerity. Maybe we’re going to fast, she’s said recently. Is that because unemployment in Spain has just hit 27%, with about 60% unemployment among youth? Every time unemployment goes up, balanced budgets, the ostensible reason behind cutting back, become less likely since joblessness means higher costs and less income for government.

The IMF caught a lot of flack way back in the past for lending to governments which were so inept and/or corrupt the money was totally squandered. Thus they decided it was necessary to impose rules on receiving countries, and, at least in theory, that makes sense. Unfortunately, their rules are based more on ideology than practicality or benefit to the people at large. Naomi Wolf wrote a book called the Shock Doctrine which describes how need for international help places countries in a position where they’re required to adhere to a conservative bankers’ worldview of how to fix their economies. For instance, that was behind the insistence that Greece lower its minimum wage in order to qualify for help. The connection between a country’s minimum wage and its ability to service its sovereign debt to the banks, the wealthy and other countries is tenuous at best. It’s just another way to stick it to the people at the very bottom who’s lives are already on the edge.

If /when your country needs international help to prop up a corrupt, sleazoid banking system, you’ll need to impose crushing tax burdens on the poor and heavy job and program cuts on essential public services while you lower taxes on the wealthy and corporations.

The elite don’t really need the money, but they ‘create jobs’ so if we throw enough money at them, they might deign to put some people to work. Except… after all the austerity cuts amidst high unemployment the masses don’t have the money to buy things, or they save because they’re frightened of losing their jobs, so there’s no reason for corporations or banks to create new businesses. Instead they use the cash bestowed upon them to speculate on securities, commodities and property, all of which is detrimental to the needs of the 99%.

The money referred to in the above paragraph is being created out of thin air and given to the biggest banks at near zero interest rates. In America that amounts to $85b per month. In Europe it’s about $50b. That new money has served the 1% well by sending the stock markets to record highs at the same time that wages are going down. Maybe you heard that the US is growing at 2.5% per year. In aggregate that’s true, but when broken down it turns out that the bottom 80% has lost ground so when tallied up we see that more than 100% of the gains have gone to the very top.    

Europe is different than the states in the sense that they have relatively strong social safety nets. In America there are no advocates for the commoners. Aside from a few fringe legislators, nobody in politics cares. Thus in some ways it baffles me how completely obsessed European leaders are with austerity. And how tardy they are with creating jobs programs, which is Europe’s most pressing need. If they can feed their banks with $50b per month with free printed money, it can’t be that much of a stretch to use it to create public service or infrastructure jobs.

There needs to be a Europe-wide jobs program financed by the European Central Bank that would be available to all EU youth and long term unemployed. Applicants could apply to work anywhere in Europe, though the greater needs would be in countries having difficulties, so most of the jobs would be there. These jobs would have a limited duration and wouldn’t pay much but they’d keep people busy doing useful things and keep them from getting too discouraged by unemployment. They’d also get the chance to live in and experience other countries. Since financing would come from the EU as a whole, it would only improve the bottom line of struggling countries. The EU owes it to those countries in the Eurozone experiencing difficulties since it’s membership in the Euro which is causing many of their problems. But other EU countries outside the Eurozone are also going through financial upheavals so to be fair it needs to be for all EU countries. 

The southern European countries have archaic and ossified labor laws that preclude flexibility and efficiency. Some also have bloated bureaucracies. Economic shock will probably force wrenching changes in society, but regardless people need jobs now, so there’s no reason to punish the unemployed for the inadequacies of their governments. Or force them wait until austerity magically begins to work, a dubious proposition at best.

The other thing Europe needs to do is rethink its currency regime. Part of the problem of countries experiencing difficulties is being tied to the Euro. The common currency is very important for Europe, but it has overreached and made several countries’ problems more difficult to tackle.

In regards to Greece and Cyprus I’ve advocated they adopt a dual currency system similar to Cambodia’s where the US Dollar is used alongside the riel, the local currency. Actually, between 80% and 90% of all transactions here are in dollars. They’ve kept the value of the riel within 5% of 4000 to a dollar for as long as I’ve lived here, about 11 years, so it’s very stable. However, if need be in a fiscal emergency they could print more riel, thus having a little flexibility. The Cambodian government periodically talks about stopping use of the dollar as its main currency, but they receive big benefits in stability and convertibility so they’re very reluctant to give up that advantage. As for Greece and Cyprus and any other Eurozone country that gets into trouble, they have no choice, they’re stuck with the Euro.

I’ve changed my thinking about the Eurozone’s problems to the point where I now feel that a two tier system needs to be adopted with the core countries of France, Germany and maybe Netherlands and Belgium using the Euro exclusively and all the other countries, or rather any one that wanted, would have its own currency alongside the Euro. That way the Euro would remain rock solid and available for all the countries of the EU (both inside and outside the Eurozone) to use, while individual countries gain some flexibility by having their own currencies alongside the Euro. Whether or not an EU country is officially part of the Eurozone, there will be large amounts of Euro in circulation.

The problem with governments and large institutions is a built-in inertia that resists any kind of change, especially when it looks like a retraction or reversal, but if they don’t come up with innovative changes they’ll only sink deeper into the abyss. Investors took a big hit in the recent Greek rescue plan, but the country is still left with extreme debt levels which they are never likely to be able to service. They’ll just flail along indefinitely from one crisis to the next while the people suffer. The only realistic solution would be a total default and reversion to the Drachma in a dual currency regime. They also need a wholesale restructuring of their society and economy. Default and absence of international help would force those desperately important changes.

Meanwhile is it possible the IMF, etcetera are waking up to the folly of austerity after ‘only’ 5 years of abject failure? Seems hard to believe but you never know.

Why Do They Hate Social Security So Much

What is it about a self-financed pension system that is funded 20 years in the future that enrages them so? What is so galling to them about the idea that millions of seniors don’t have to beg for sustenance as was the case before Social Security?

And yet, the moneyed elite and their idiot minions in the conservative base have been on a rampage against it from the minute it was passed into law in the 1930’s. And now they - and Obama, their enabler - want to cut benefits as a means of bringing down the country’s deficit when SS has absolutely nothing to do with the deficit, never has and never will. The Social Security Trust Fund has $2.7 trillion in the bank, actually it is held in US Treasury Bonds, the same bonds that foreign governments and rich people own.

The meme in Washington among the punditocracy is that ‘entitlements’ must be cut if there’s any chance of bringing down the deficit. Entitlements is in quotes because SS and Medicare are self funded; they are not entitlements, you only receive those benefits if you’ve paid into the program. Medicaid, on the other hand, the federal program that provides medical assistance to those who otherwise can’t afford it or have no access to insurance, is an entitlement because any American who fits the qualifications is eligible for aid.

Those three programs make up about 60% of the US budget, $2 trillion out of $3.4 trillion so they are easy targets for regressives. If you’re interested in this budget stuff, I highly recommend a web site called usdebtclock.org. It keeps a running total of debt and income totals; it’s truly fascinating to watch the numbers rolling along. But, once again, SS and Medicare really do not belong in the budget because they are self funded, so having them there clouds the issues.

It’s worth spending a few minutes on how SS became part of the budget. Lyndon Johnson started the practice of folding SS into the budget to try to mask or minimize the cost of his Vietnam war. SS being so large it made his war expenditures a much smaller part of the total budget. The reality was the same but the perception was different.

In 1980 Reagan doubled down on the scam. He looked 30 years ahead and said, My god, the Baby Boomers are going to overwhelm the system when they start retiring in the next century so we need to raise payroll taxes now to put some money away for the coming crunch. SS payroll taxes are as regressive as you can get. Not only does everybody pay their 6 ¼ percent regardless of how poor they are but the wealthy are exempt for all income over about $120,000 annually. So, raise taxes on the lower classes and it looks like you have an extra $200 billion a year coming in which you can then use to lower taxes on the wealthy, which is exactly what Reagan did.

It’s more familiarly called slight-of-hand. The additional money coming in off of the increased SS tax is borrowed from the SS trust fund, so it’s not really the government’s money, but it looks like the budget is more balanced than it really is. Despisers of SS say the SS Trust Fund is just a bunch of IOUs; very true, but China holds a trillion dollars of those same IOUs and you wouldn’t hear any American politician or pundit say that to China, now would ya?

The way Obama wants to reduce SS benefits is called chained CPI or consumer price index and it’s supposed to reflect the ability of people to substitute cheaper items when the price of the things they want to buy rise too much; so buy margarine instead of butter, pork instead of beef. This is Obama’s plan, the Repugs have not proposed it and if Obama gets his way the same Repugs who hate SS will use Obama’s Chained CPI to campaign as the true defenders of the program… fucking hypocrites, but that’s what will happen and it could easily cost the Dumbocrats in the next election, if they don’t find some intestinal fortitude take a stand against Obama.

The loss to SS recipients would not be a lot of money – 3% over 10 years up to 10% over 30 years if they live that long. But they don’t have a lot of money to begin with. The average monthly check is about $1200. That is not the high life. In many parts of America that is just scraping by. Some 60% of recipients depend on SS for 80% of their income. A lot of people like myself receive far less. Even the largest checks do not involve a lot of money. A fellow I talked to recently, who paid taxes at the maximum, said he’ll receive $2600 per month at 62. Plenty enough for me, but hardship for a lot of Americans.

And why are SS recipients, which to be clear include the disabled as well as seniors, being asked to make this sacrifice. What is the purpose? What is to be gained, vis-à-vis the budget?

This cut in benefits will reduce the total budget by about $163 billion over ten years, $16.3b per year. To put that number in perspective, last year GE, one of the world’s largest, most profitable corporations earned nearly $14 billion, of that they paid no taxes, but instead received a $3.7 billion refund. If they had paid the standard corporate tax rate of 35%, then the Treasury would’ve received about $5b. So add up the tax they should have paid and the refund they shouldn’t have gotten and that comes to $8.7b or more than half the savings the government would gain by screwing pensioners. Now that’s only one corporation, though admittedly one of the sleaziest. Or how about the $8b in corporate welfare that goes to the largest oil companies? Exxon needs a subsidy? Ripping off SS recipients is more important than ending that subsidy?

Meanwhile, once again, it’s not the government’s money anyway, it only looks better on their bottom line: it’s our money, we paid for our benefits. The government can borrow that money if they want, but if they renege on their commitments and raid the Trust Fund they’ll be stealing. In this case stealing from the poor to feed the rich, which is nothing new in today’s America, but still…

  

Elite Cluelessness - Cyprus & Singapore

 

Cyprus

The recent economic turmoil in Cyprus once again displays how clueless and disconnected the ruling elite are from the reality of people’s lives; once again provides a striking example of their desire, nay obsession, to minimize impacts on the wealthy by taking from the poor.

Cyprus has gained a lot economically by being a haven for offshore banking – their banks’ assets are several times the economy - and so it was easy for the Troika – IMF, European Central Bank and European Commission – to look for bailout money from account holders. A large percentage are owned by Russians and a good percentage of that is shady money being laundered, so to penalize the country they devised a scheme that would levy a one-time tax of 6.7% on accounts of less than €100,000 and 9.9% on accounts over €100,000.

That was a bald-faced attempt to steal from the poor, while concurrently minimizing losses for the rich. Before that proposal was made, it was believed by all depositors in all European banks that all accounts under €100,000 were insured, guaranteed, rock solid. Up until that point, all felt safe that nothing less than a total breakdown of society would jeopardize their savings.

Instead, people with €1000 in the bank were expected to do their share, to the tune of  €67, to save their incompetent banksters. After all, if the little people weren’t taxed than the rich would have to pay a lot more. That made it an easy step to propose reneging on their previous hard-wired guarantee. Not only did all hell break loose in Cyprus, and all legislators in parliament either voted against the proposal or abstained, but now, regardless of the Troika’s insistence that that was a one-off and only applied to Cyprus and no other average people would be forced to assist in bailing out banks in the other Eurozone countries experiencing financial difficulties, nobody will be able to trust that €100,000 guarantee. It’s finished, nobody with money in the bank will feel completely safe again.

They then tried to float basically the same idea but exempt the first €20,000, but that was only marginally more acceptable than the first rip-off plan. The latest proposal is that only deposits above €100,000 would get hit, which is they way it should’ve been from the start.
A guarantee is a guarantee. If you had €100,001 in the bank, you knew the first €100,000 was protected, but that you were taking a chance on the last €1. Especially if you were putting your money in a notorious offshore banking center, unless you are a complete idiot, you had to know there was a good chance, however remote, that you could lose out. That’s what capitalism is supposed to be all about; You invest, you speculate, you take your chances; you win some, you lose some. Instead the elite seek to protect banksters and their investors and wealthy depositors at all costs and the little people are left to foot the bill and then fend for themselves.

The elite have gotten so isolated from masses they live in their own personal bubble and can no longer relate to the real world of the 99%. Like when Romney was asked what a person could do when they couldn’t find a job in a very tough market for job-seekers, he said, Ask your parents for money to start a business. Yes, very simple, ask your parents.

Personally, I prefer in all the chaos afoot that Cyprus is ‘forced out of the Eurozone’. As mentioned in a previous post, leaving the Euro and having their own currency will not stop most transactions in the country being in Euro. Having their own currency used alongside the Euro, as happens in Cambodia where about 80 to 90% of all transactions are in US Dollars, will give them some flexibility. What Cyprus ‘leaving’ the Euro would do is begin a two-tiered currency system in many European countries in which Euro and local money are used side-by-side. It would also be two-tiered in the sense that the Euro would be a master currency backed by and used exclusively in the strongest northern countries – Germany, France, Netherlands, Belgium, Austria - with the remainder of individual states issuing their own currencies for local transactions; for instance, all government salaries and payments to government offices would be in local money. Once the local money finds its proper value - it would be volatile at first - the individual states would try to maintain it within a narrow range compared to the Euro. Cambodia, for instance, has kept its currency within a 5% range of value compared to the USD for the 11 years I’ve lived in the country, so it’s accepted along with dollars with little or no discounting and there’s no need to recalculate every day.

Regardless of how the bailout evolves, Cypriots are in for serious hard times with massive unemployment and punishing austerity for as much as a decade. They got rich off of being an offshore banking haven, now they will pay the price. Once again, the lure of big bucks casts aside all doubts, restraints and reason and it’s full speed ahead until the ship hits an iceberg.

Singapore

In February, Singapore experienced its largest ever demonstration; 4000 people turned up to protest against the government’s push for increased immigration. People tend not to protest there since they are wealthy and relatively content in the world’s number one nanny state, not to mention the government oppressively and forcefully frowns upon such activity.

The demonstration, along with the loss of a seat in the legislature to the opposition in a by-election, quite stunned the ruling elite. The Lee family, which has ruled the city-state since independence in the sixties, now has to contend with the largest opposition ever – they now have 7 seats in the 87 seat body. Until recently, the largest opposition contingent was four. That is not because 95% of the population has always solidly backed the government, rather the government has devised a painless (for them) and bloodless means of eliminating all official dissent.

The first time an opposition member of parliament makes a statement deemed to hurt the feelings of the ruling family, he/she is sued for defamation for everything they’ve got and is subsequently bankrupted – the government never looses such a case – and once bankrupt is no longer eligible to sit in the legislature.

But this is the 21^st century and people over the world are finding their voices and are less able to remain pliant and docile when they feel impacted by social changes that are not to their liking.

Singapore’s population of 5.2 million is now 40% foreign born, up from 22% about twenty years ago. The protest was in response to a government white paper which seeks to add another million and a half immigrants to the city by 2030. The government insists that the country needs more people to continue its industrial and economic growth, but their citizens, like wealthy populations everywhere, are not much interested in making babies. The birthrate there is even low by wealthy country standards. They’ve tried everything including special benefits for having kids and even a government dating service, to no avail.

As almost everywhere the government is locked into endless growth, growth as the be-all and end-all of society, as its guiding philosophy. Bhutan, which is promoting a Gross Happiness Index in place of Gross Domestic Product, is probably the world’s only exception. If Singapore has more people and more wealth, that must be a good thing, no?

However, while the government sees immigration as a  path to increased wealth, the protesters, as the majority of the people at large, see higher property prices, competition for jobs which lowers wages, more crowded public transportation and strains on public services.

The question is; Growth for who? It certainly isn’t the commoners who benefit, it’s strictly the elite who benefit from growth in a mature economy. Growth can be justifiable in a developing country which has large numbers of desperately poor people. In developed countries, small places can be improved by expansion if that growth adds intellectual and financial opportunity, but once a location reaches a certain size, it’s mostly downhill, at least in terms of livability. Sure there’s lots of money to be made in megalopolises, but if you’re in a place like LA and have to spend two to four hours a day commuting, the money no longer has the same value.

Some countries with large geographic areas but small populations, such as Canada and Australia, can benefit from immigration, but Singapore with an area the size of New York City and a projected 7 million people – about the same as NYC - will be just as crowded and difficult to live in, especially for the lower classes. The wealthy have no concerns about housing prices or overburdened public transportation. The country’s legislators earn more than a million dollars a year, so would have little concept for what their constituents deal with on a daily basis.

Singapore’s rulers have never had to consider the people’s wishes before and I’m sure they’ll continue to use their defamation magic to try to quash their token opposition, but the tide is turning and they will be forced to listen to the people.

Personally I’m a fan of immigration, at least in theory. I’m one myself, though few would refer to me that way, but after 11 years in Cambodia, what else could I be? One could even consider me an economic migrant, since I could not make it in my native land without abject penury and bemoaning my fate 24/7. Cambodia’s lax immigration policy has brought hundreds of thousands of relatively wealthy expats to live here. My lowly pension is still several times Cambodia’s per capita income so I’m making a positive contribution in spite of it all.  

Immigration would also be a good idea for countries like Korea, which has the world’s most homogeneous population and Japan with the second most, even though both countries are relatively crowded, because they desperately need lessons in and experience with relating to diverse peoples.

As a long time expat estranged from my own country, it’s unsurprising that I believe that one of the best movements for the world is immigration that mixes people up and gets us closer to understanding each other. That isn’t to say it isn’t extremely important that immigration happen at a slow measured pace otherwise backlashes that have destabilizing impacts are possible.

Welcome to the world.

575 Gigatons

Five-hundred-seventy-five gigatons is how much carbon dioxide we can put into the atmosphere without the Earth’s temperature going over 2º C (3.6ºF). The total carbon stored in the ground is about five times that much. In other words, 80% of known reserves of fossil energy has to stay in the ground if we’re not to exceed that number.

Australia has recently sweltered in a heat wave so intense its weather service had to add two colors to its temperature map to represent temperatures over 50ºC (122ºF). High temperatures and brisk winds have spawned vast wildfires there. Hurricane Sandy brought the lowest barometric readings ever recorded in the Northeast and had hurricane force winds that stretched for about 950 miles. Sixty percent of the contiguous US is experiencing drought; about half of that is categorized severe, extreme or exceptional.

The extreme weather we are now experiencing is the result of ‘only’ 0.8ºC so the impact of a 2ºC increase has to be daunting if not almost incomprehensible. And yet we are not only headed in that direction but our emissions are actually accelerating. Whereas we, the world, need to reduce our emissions by 5% a year to save ourselves, emissions rose by 3% last year, the fastest rise ever!

China is opening a new coal-fired power plant every week. By 2020 it will double its coal consumption. (This is not without its immediate environmental consequences – Beijing of late experienced extreme pollution levels.) It’s also damming every river in the country and is the world’s largest producer and consumer of solar installations, but that doesn’t change the fact that its emissions are rising very fast as a result of its high growth rates. It’s not the only culprit, new coal plants are opening all over the world, including here in Cambodia. And in total contradiction to common sense, the consensus in the financial community is that China needs to wean itself from exports and encourage its people to consume more. The elite who run the world are living in a 20^th century bubble and are completely divorced from reality.

The US media has been gushing uncontrollably of late about how fracking is opening up large new reserves of oil and gas and the country may be self-sufficient in ten years. That is mostly hype since yields from fracking wells fall precipitously after the first year – 60 to 90% in most wells, but regardless, that fossil fuel needs to stay in the ground to save the world, and that would be true even if fracking didn’t cause permanent groundwater contamination. The idea that permanent loss of groundwater is a worthy tradeoff for 5 or 10 years of cheap fossil fuel is ludicrous, stupid and insane, but that’s exactly what’s happening.

To make it clear where the US stands on climate change, at the recent Doha climate conference it worked its damnedest to scupper, stymie, put a spanner in the works to prevent any meaningful global action on climate change. (It was also beyond ironic - but telling of the political world’s real attitude towards climate change - that the conference was held in Doha which has the highest per capita emissions in the world.) Obama has made clear that doing anything serious about global warming is less important than dealing with unemployment, etc. And yet… the economic conversion necessary to tackle the climate problem would be the best way to put people to work. Mr. Compromise doesn’t understand that the climate is not negotiable, that it cannot be fixed with a political compromise. It’s a real-world engineering problem which portends certain catastrophe if not dealt with immediately and is not at all like making sausage.

I greatly admire those activists who’re putting their life into trying to make a difference, and I guess, by writing this, I’m doing it too in my own limited way, but still it’s hard not to feel pessimistic. Regardless, we need to be apprised of what’s happening, active in trying to change the paradigm and aware of the consequences of continuing on our present path… even if we can’t do anything about it. In this case we are, by being active, working for our own personal salvation even if the world, as we know it, is doomed.

And a short comment on packaging…

100% Ain’t What it Used to Be

I always liked V-8 juice; good taste, 100% vegetable juice. There are juice companies here in Asia that do veggie juice but they always add fruit to the mix. Orange juice is added to carrot, Apple juice added to green veggies, etc.  So occasionally (because it’s relatively expensive) I’d buy a can of V-8… until I discovered 100% ain’t what it used to be. Underneath the easy-to-read words, 100% vegetable juice, in script that is partially obscured, that you might not notice right off, it says, with added ingredients. How ingenious to create something that’s 100% and not 100% at the same time!

I recently bought a container of grated parmesan cheese made in America. On the front it says 100% real cheese in one place and 100% grated parmesan cheese in another. On the list of ingredients, however, it says powdered cellulose added to prevent caking. Somehow the powdered cellulose (most likely ground up wood) doesn’t count as part of the 100%. All the more reasons why I try to avoid any type of packaged food produced in America… not that I trust foodstuffs produced in Asia (honesty in packaging from China?) but when it comes from the US, it’s almost certain to be tainted.

Food labeled organic is usually a good bet, but now that major corporations have taken over the larger organic food producers they’ve started pestering the FDA to loosen organic standards so they can legally adulterate their ‘organic’ products. Since Obama recently appointed a Monsanto hack to head an important FDA office, that loosening is very likely to happen.

Bin Laden Strikes Back From His Watery Grave

In Pakistan recently nine health workers who were administering polio vaccines were killed by the Taliban. For several years now, Pakistanis in general and the Taliban in particular have been skeptical about the honesty of the program, believing that it was a Western base for spying and a conspiracy to make them impotent amongst other evils. As a result of those murders the program was halted.

Pakistan is one of only three countries in which Polio is endemic (Afghanistan and Nigeria are the others) and great progress has been made over recent years bringing down the yearly total of infections from around 20,000 to about 50.

Pakistani suspicions about the program were confirmed when it was revealed that the CIA used a fake vaccination program to try to get information about Bin Laden’s whereabouts. While the doses administered were real enough, immunization only comes with three doses and they only did one so the program was a total scam. It was unconscionable for the CIA to set up the fake program and even worse for the Pakistani doctor they used to run it. The doctor was given a 33-year sentence, which the US strenuously objected to, for collaborating with the CIA. The sentence was well-deserved, since it’s not only the health workers who’ve subsequently paid with their lives, but also the tens, hundreds or thousands of children who may eventually suffer from polio because they were denied access to the vaccine. Polio kills or permanently maims an individual within hours of being infected.

In the end result, they got no useful information from the fake program, but did manage to jeopardize the lives of many innocents. When you come right down to it, America’s action was the equivalent of murder, but since it’s only Pakistani children who’ll die or be crippled, it’s clear they don’t count for much. Whatever it takes to kill Bin Laden, right?

There’s a popular new movie, Zero Dark Thirty, about the capture of Bin Laden which bills itself as based on a true story. However, the major theme of the film, and which takes up the first 45 minutes of action, is the efficacy of torture in gaining useful information on his capture. That was a total lie since no useful information was gained from torture. When confronted by that fact the director of the film said, It’s just a movie. Just a movie which tries to make torture cool, useful and acceptable when it had nothing to do with the capture of Bin Laden.

As I understand it, there’s also a popular TV program in which terrible terrorist acts are thwarted at the last minute by the use of torture. Torture is never justified. As far back as the 18^th century, the prohibition of ‘cruel and unusual punishments’ was enshrined in the 8^th amendment in the US Bill of Rights. The routine use of torture insures that innocent people will be abused, not to mention that the torturers themselves become dehumanized. No matter, it’s now the American way along with motherhood and apple pie.

Torture is not the only part of the abrogation of basic human rights that has been embraced by the American people and their government. The US now assumes the right to assassinate anyone, anytime in anyplace, including American citizens, it thinks is a bad guy. Forget the right to a fair trial and presenting of evidence; that’s so 18^th century. And if innocent civilians get caught in the crossfire, well that’s the price of war.

America’s drone strikes have been a lot more successful lately, since the definition of insurgent/terrorist was changed. It used to be that a person had to be individually identified as a bad guy to be targeted, now every man killed in a drone strike between the ages of 18 and 35 is automatically assumed to be an insurgent.

In the latest killing innovation the CIA has begun signature strikes. Previously, they only targeted known bad guys; now, activity that’s merely suspicious is enough to get blasted to smithereens. That is how 11 girls aged 10 to 17 were murdered in Pakistan recently. They were out before dawn collecting firewood when they were taken out by a drone pilot sitting in a comfortable chair in front of a computer monitor thousands of miles away. Those of you dependent on the mainstream media probably didn’t hear about that incident, they’re only Pakistanis, after all.

Twenty American children killed as a result of a crazed gun culture and it’s the top news for weeks; eleven Pakistani kids killed by US drone strikes and it barely rates a mention in the US media. Well, there’s a war going on and collateral damage is inevitable, so they say. Still, it’s not hard to understand why an overwhelming percentage of Pakistanis hate America. And why Bin Laden couldn’t have asked for a better outcome to his death.

Déjà Vu All Over Again.

About 4 years ago, right after an American election and before an Israeli election, six prominent Gazans were assassinated by Israel. This came in the midst of a long-time relative lull in rocket attacks. It was clear at the time that the killings and subsequent bombardment of the Gaza strip had been planned for months.

This time, after several Palestinians, including a 13-year-old boy, had been killed in the previous week or so, Ahmed Al-Jabari, head of Hamas’ military wing, was assassinated in a trap set by Israel the day after he thought he had negotiated a cease fire with them.

Israeli leaders need to show how tough they are to be able to appeal to their constituents, who mostly seek revenge and retribution against the Palestinians will never give up their quest for freedom from occupation no matter how many die or how many suffer the repression that comes in response to their valiant, but feeble attempts to fight back and gain their freedom and dignity. Israel has no interest in negotiating a real peace, one that would be fair to the Palestinians, because that would mean giving up land they have stolen, so they need to kill and maim and destroy on a regular basis to try to suppress the restless natives and hold onto their dream of Greater Israel.  

The majority of Israeli Jews are completely out of touch. When the UN General Assembly votes 189 against Israel, 3 for, they don’t connect their actions, their murderous ways to the reason for their near universal censure. The BBC radio program World Have Your Say interviewed an Israeli living near Gaza. He was complaining about having to spend so much of his time in his bomb shelter. He then made one of the most preposterous, off-the-wall statements I’ve ever heard, anytime, anywhere. He said that the Gazans don’t build bomb shelters because they know the IDF doesn’t target civilians. This at a time when 90 Gazans had died and 700 were injured.

Is he unaware that his country has maintained a blockade of Gaza for 5 years in which building materials are banned from import? There is one way around the blockade, through the tunnels between Egypt and Gaza, but everything costs twice as much when it comes in that way. Is he aware that Gazans are very poor. That they don’t have the money to build shelters. Does he know that 80% of Gazans are dependent on food aid. Is he aware that 50% of children there are malnourished because Israel limits the amount of food that’s allowed in.

The blockade has shut down 95% of Gaza’s industry because no raw materials are allowed in and no finished products allowed out. A substantial part of Gaza’s farmland is off limits because it’s either near the border – any Palestinian within 300 meters, and sometimes a lot more, of the border is liable to be shot – or was destroyed in the last Israeli rampage. They aren’t allowed to fish more than 3 miles from shore. They have few options and almost no hope so they don’t care how hard they are hit, or how many of them die as long as they can pick off a few Israelis with their rockets and occasional sneak attacks.

The next night an Israeli said that the IDF is the most moral army in the world. The words, moral army, in themselves are an oxymoron. Soldiers are trained to kill, and if they feel threatened, to shoot first and ask questions later. As for the IDF, it’s noted around the world for being ruthless, callous and brutal. Israeli Jews live on another planet where they are always right and everybody else is wrong.

Subsequently, an Israeli on the program said he wanted the army to go in and finally wipe out the terrorists, like the army hasn’t been trying to do that for the last 30 years. He sounded young, probably was not even born when the first Intifada began. They never learn, they’re always the victim, they never connect their brutal occupation with the attacks against them. No matter how many times their violent, bloodthirsty ways fail to bring safety and security, they only know how to double down on the killing.

The night before the cease fire, an Israeli insisted that his country had totally left Gaza, as if leaving a place still allowed you to enforce a near total and crippling blockade. In fact, the IDF goes into Gaza anytime they want, to arrest anybody they want, to kill anybody they want. Israelis have no clue, they only know talking points, they’re divorced from reality, they’ve lost their capacity for fairness or compassion or even logic. If the roles were reversed, and the Arabs were the occupiers, the Jews would fight to the death to free themselves, and use all means at their disposal to do it, just as they did in their fight to create the state of Israel in 1947 when they committed devastating terrorist acts, like the bombing of the King David Hotel in Jerusalem when more that 200 innocent people died.

It’s clear what Israelis want. A recent survey showed nearly 60% think they live in an apartheid state and want to keep it that way, with their Arab citizens, who make up 20% of Israel proper, permanently relegated to second class status. A poster of four maps showing the loss of Arab land since the beginning of Israel has circulated on the internet and elsewhere. The 2012 map shows the West Bank as hundreds of tiny dots or small enclaves – urban ghettos and rural shtetls – surrounded by land controlled by Israel. Palestinians now control about 10% of the West Bank.

When the poster was placed on the London Underground it was called a provocation by some Jewish groups. Yes, the truth hurts, and it is very provocative to show how Israel is seeking to squeeze the Palestinians into ever smaller ghettos, something no other country in the world would be allowed to do. As long as the US vetoes every attempt at the UN to stop Israel from its illegal and immoral actions and also provides billions of dollars in military aid - in spite of Israel being a wealthy country - the farce will continue, nothing will change to balance the Arab-Jewish equation or provide the Palestinians the freedom every person in the world deserves.

The Gazans consider their efforts to have been victorious, since in spite of being outgunned 1000 to 1 they managed to kill six Israelis and wound many more. It doesn’t matter to them that 162 Gazans were killed and more than a thousand injured, they’ll never cease their fight for freedom. On the other side, Israeli Jews have to know they will never be safe and secure until justice is done, no matter how much destruction they wreak or how many casualties they cause. They could indulge in mass murder or deportation to try to stop the resistance, as some Israeli politicians have suggested, but even the US might balk at that.

QE3 - Not for You and Me

QE 1 and 2 worked so well the US Fed has figured it’d be great to go for another round. QE stands for Quantitative Easing, which is a lot like printing money in common terms. The first two involved printing a half-trillion dollars each, which was used to buy near worthless mortgage backed securities from the banks at face value. As a result of those QEs and lots of other money lent to the banks at near zero interest - which, since those super-low interest rates are less than the rate of inflation, is akin to paying the banks to take that money - the stock markets are near all-time highs, corporate profits are soaring to the point that American corporations are sitting on nearly $2 trillion dollars of cash reserves and the 1% are seeing massive gains in their wealth. So it’s worked out fabulously.

Well now, that was a joke, that’s not really why they did it, or why they said they did it. As it happens, the 1% already have a greater share of national income than at any time since 1929. No it’s because they’re worried about unemployment continuing to be stubbornly high and the economy being in the doldrums for a large number of Americans. Which brings up Einstein’s definition of insanity; that is, repeatedly doing the same thing while expecting a different outcome. But feeding the banksters is the only thing they know how to do, it’s the only trick in their bag, so they have to keep plugging away at it.

With all that extra money to play with the banks - or so the theory goes - will be eager to lend it out to businesses who actually need it to do real, productive work in the economy and finally some of it will trickle down to the masses. But that involves risk, it’s much easier to take that new-found free money and buy US treasuries at 2% interest. When they do indulge in risk they speculate on commodities, which inevitably raises the cost of basic foodstuffs and other necessities of life, but hey, that’s the magic of the free market – goods and services are allocated where they can create the most benefit for those capable of paying for them.

QE 3 will mean a mere $40 billion per month, with no end date, of new printed money. It’s free money, figmentary money, conjured up out of thin air, which means, at least in theory, it should cause inflation – if you’ve got an increased amount of money relative to economic size and capacity, then each dollar should be worth less. That’s actually not happening today since in spite of the inherent weakness in the American economy and its massive public debt and budget deficits, there’s such economic turmoil in the world, the dollar still constitutes a safe bet in the minds of many people and so world investors sitting on huge piles of cash have been flocking to US Treasuries. That cheap money that’s easy to print while still maintaining value cannot last indefinitely without drastic belt-tightening changes which are extremely unlikely to happen. If/when the dollar crashes it’ll come suddenly with almost no warning.

Meanwhile as long as it’s so cheap and easy to create money with no ties to anything real, anything of value, why not use it to actually create value? Why not use it in a way that actually makes a difference for somebody besides the bankster 1%? I realize it’s an immense stretch for America’s political and financial leaders - not to mention those of the UK and EU and others who are also indulging in printing money to feed the banksters - to imagine using that imaginary money for the public good, but just in case they’re struck by lightning and come within an inch of death, or close enough anyway, to have a change of heart, here are some thoughts how that free money could be used.

Forty billion dollars would buy a new extensive light rail system for eight to ten American cities. In a few months every city large enough to be able to take advantage of efficient, clean light rail would have one. Roads, bridges, sewage systems, electrical grids, alternate energy applications… whatever, $40b per month is not small change.

The anti-poverty programs of the sixties and seventies (not to mention the programs of the Great Depression) could be resurrected. In the late seventies at the end of Lyndon Johnson’s War on Poverty, before the Reagan revolution changed the US government’s focus to a war on poor people, I participated twice in the make-work, CETA – Comprehensive Employment Training Act – program. Anyone who was out of work for more than a year was eligible.

The first time I helped build a play structure in a small church-owned but publicly accessible park. CETA provided our wages and a small amount of money for administering the contract. The artist/sculptor who they wanted to do the job wasn’t eligible so I agreed to take the job but then work half time and share the pay with him. It was a six month contract which paid $833 month - $10,000 on an annual basis. Not a lot of money even back then, but enough to keep from begging or depending on other people for housing and food. CETA jobs lasted a maximum of one year and weren’t intended to be comfortable jobs but only tide you over until you could find a ‘real’ job and hopefully learn something in the process.

Just after that contract ended another CETA job opened up in a community recycling program. The business in question had been picking up food waste but didn’t have a good method for processing it. It’s great stuff when composted but super grody and a bear to deal with. That was a year’s contract for four staff. We learned a lot about composting that year and produced a decent report, but frankly the subject matter didn’t really warrant four people working full-time for a year. The occasional boondoggle aspect was one of the reasons conservatives hated the program so much. Still it kept us (me anyway) off the streets and provided a survivable income.

It also introduced me to a group of people doing a recycling program where I eventually spent 13 years and it became the major focus of my working life. And I was able buy a house on contract because I had a steady income for a year and a half which gave the seller confidence that I could make the payments. Today it’s tough love for the people, welfare for the banksters.

As long as QE money is ‘free’, not costing anybody anything (aside from the future possibility of inflation), not connected in any way to productive endeavor, now only going to line the pockets of the country’s wealthiest citizens, why not spread some of that largesse around? Why not get people working, provide a little hope for the future and a little pocket change for the present? Never. Cannot happen. The poor barely exist in the American political lexicon, now only the middle class matters and according to both candidates that includes people earning up to $250,000 per year, a figure which puts them in the top 3%.

Now the so-called fiscal cliff is approaching. According to agreements made in the past, if the Congress was unable to come up with a reasonable deficit reduction plan, there will be automatic cuts in spending and a return to pre-Bush taxes. In other words, the economy will head downhill, just as many of Europe’s economies are. It’s obvious if you increase taxes and cut public spending, then you will increase unemployment and generally hurt the economy. So now even the Repugs are turning into (back-door) Keynesians.

The only way to increase government revenue without harming the economy is by taxing the wealthy and their special breaks (taxing capital gains at less than working income, exempting inheritance from taxation and giving them a free ride on their stock transactions) since their excessive wealth does nothing good for the economy while their excessive speculation and high-speed trading are truly destructive.

Needless to say that can’t happen since they own the government.

In other news, Hurricane Sandy, a storm of unprecedented size, helped along by ocean temperatures 5º F above normal, wreaked havoc in the eastern US. Global warming, which unquestionably had an impact on the size and severity of the storm, was never mentioned in the debates for good reason: Both candidates were allowed to vet every question, neither wished to broach that uncomfortable topic. However, unprecedented storms, droughts and heat waves have a way of intruding on preordained debate questions. Without drastic changes, starting yesterday, in the way energy is produced and used in the world, and especially the US, then the worst, not to mention the unthinkable, is yet to come.

Meanwhile, after nearly two years of campaigning, the election is finally upon us. Mr. Pain Capital, who earned his money bankrupting healthy companies or sending their jobs to China is neck and neck in the national polls with Mr. Hopelessly Compromised. Still, in American elections the popular vote doesn’t mean much, it’s the votes of the individual states that matter. In that case Obama is ahead, though, as in the case of Ohio, not enough to insure against fraud and theft. He only won last time because his margin was too great to allow for Repugs to steal the election.

The reason why election theft is still a realistic possibility in spite of Bush’s boys stealing two elections in a row is that the Dumbos never thought it was important enough to pursue, uncover and root out the causes of the theft. They never thought it was important enough to hold hearings, do research, fight to have voting machines count honestly. Most of you will be amazed to learn that, according to Jimmy Carter, foremost authority on honest elections, Venezuela has the cleanest elections he’s ever monitored. Simply put, they have machines which in addition to electronic counts also produce a receipt which allows the voter to double check to make sure their vote is counted correctly. Incredibly simple.

Not in America where voting machines are owned and operated by private companies which are allowed to hide their software under the guise that it’s proprietary information. And if many voting machines in Ohio are owned by companies connected to Romney’s son or his partners at Pain Capital, where he still is reaping large returns, well, what the hell. According to the Dumbos, or so it would seem, if you’re smart enough to steal an election, then you must deserve it. Otherwise they would’ve fought like hell against the brazen thievery that put Bush into office twice.