Is there a Global War Between Financial Theocracy and Democracy?

[An article by Les Leopold]

Senate and House conferees are about to reconcile a financial reform bill that is virtually designed to institutionalize "too big to fail." And when they do we'll lose another battle in the ongoing war between global financial markets and democratic nation-states.

This war has been going on for decades -- but democracy hasn't always been in full retreat.

The New Deal Conquest: During the Great Depression democratic forces gained the upper hand in the war. We realized that financial markets, which are driven by the largest banks and financiers, had to be tightly controlled. We knew that global speculation on currencies only deepened the Depression and had to be strictly limited. We knew that an iron curtain was needed between commercial and investment banking to protect Main Street depositors from market madness (that was the Glass-Steagall Act). And most importantly we knew that the key to preventing economic upheaval was to limit the wealth of the super-rich and to increase the wealth of working people through progressive taxes, Social Security, wage and hour laws, and the promotion of unionization. The Bretton Woods agreements forged by the Allies during WWII set up strict rules for global finance, rules that kept financiers in check for more than a quarter century.

And it worked pretty damn well. As economist Joseph Stiglitz points out, this era saw only one financial crisis (Brazil, 1964), and working people in western democracies made huge gains. Since the era of deregulation took hold in the late 1970s, the world has suffered over a hundred financial crises and middle-class incomes have stagnated.

The Deregulatory Counter-Offensive: By the late 1970s, bankers regained the advantage through the spread of a new faith in self-regulated markets. The economic apostles of unfettered markets lobbied against progressive taxes, unions, and social welfare programs. The new orthodoxy was: Let the elites collect the money--they'll invest wisely (instead of consuming), and all boats will rise. This near-religious revolution rapidly spread through the economic and policy establishment. Regulations were dismantled right and left, and the revolving door between government and Wall Street started spinning. The American financial catechism ruled the world. And on Wall Street, the money tap was open. It did not trickle down.

Then, suddenly, in 2008, the market gods destroyed themselves as the unregulated financial casinos crashed and burned, just like they did in 1929. For a few months, it seemed like the deregulatory theology become a global heresy. It was obvious that Wall Street's reckless speculation and its bold new wave of financial engineering had caused the Great Recession. (See The Looting of America for an accessible account.). It was also clear that if government didn't come to the rescue, Wall Street would lay in ruins, along with the rest of the economy. This was the perfect moment for democracy reassert democratic control on financial markets, just as we did during the New Deal. We blew it.

The Victory at Too Big to Fail: At the moment when Wall Street was on its knees, we decided to bypass serious reform. Instead, we rebuilt Wall Street, using taxpayer money and guarantees - more than $10 trillion worth. We let bankers use our bailout money to pay themselves $150 billion in bonuses -- at a moment when over 29 million Americans were jobless or forced into part-time jobs. We allowed the top hedge fund managers to walk off with over $900,000 an hour (not a typo) in 2009. Windfall profits taxes? No. In fact we let hedge fund honchos pay an extra-low tax rate by calling their income "capital gains." We didn't restore Glass-Steagall, we didn't break up "too big to fail" financial institutions. In fact the biggest banks became even bigger, courtesy of the U.S. government.

The Invasion against Democracy: The war is escalating. Right now, financial elites aren't just fighting a defensive battle against new regulations. They're playing offense: They're whipping up deficit hysteria around the globe and calling for drastic cuts in middle class programs. Why? They want to ensure that their loans to governments aren't threatened by rising public debt. Ironically, the public debt they're so worried about was created in large part by them -- the result of huge bailouts and other expenses stemming from the crash they caused. Although the bankers want us to dismantle what remains of our worker-oriented policies, welfare for the financial elites is still fine and dandy.

This is the most dangerous counter attack in the history of finance. We had better know a great deal more about the attackers. Who makes up this shadowy force called "global markets"? Who fights their battles? Do they have a high command?

Not really. There is no executive committee of financial elites. There's no international conspiracy, no Elders of Zion. Instead these markets are pulled and pushed by about 50 very large banks and financial institutions. This is where much of the nation's $2 trillion in hedge fund money roams. This is where the top six US banks frolic. They don't have to sit around a table strategizing. They instantly sense threats to their power. They instantly smell profitable openings and they're poised to grab what they can, whenever they can. They thrive on turmoil, which gives them new "proprietary" trading opportunities to exploit. Volatility means big bucks, especially now that the largest players know that the government will back up even their wildest gambles. History has just proven that they are way too big to fail.

Of course they still have to lobby government officials--many of whom either were bankers, or will be once they leave office. But their most powerful lever on government is through the market itself: Here, by moving vast quantities of money around, they can instantly veto policies they don't like. If the EU talks seriously about financial transaction taxes, the markets go down the Euro grows weaker, and interest rates rise--making it more expensive for governments to borrow the money they need to operate. Politicians have learned to "listen" to the markets and are conditioned to placate them.

Should a nation state get out of line (Greece, Italy, Spain, Portugal, etc), the markets slap them silly. Politicians rush to the scene and start slicing social spending. If instead they demand new taxes on financial elites to reduce public debt, the markets respond with even more fury. Money flees.

All the external machinery of democracy still clanks along. We still pull the levers in the voting booth. But the decisions that affect us the most are made in a profoundly undemocratic way. Faceless financial markets exercise far more control over politicians than the voters who elected them.

So the problem isn't just the corporate campaign contributions, or corporate media control or the academic consensus supporting our financial theocracy. It's the raw power of the markets. They've been roaming free and virtually unregulated for more than a generation, and now their power is unparalleled. Just months after they brought our economy crashing down, they're right back to their old tricks, setting the stage for the next crash and the next bailout while getting filthy rich along the way.

Bill Clinton nailed it on the head when he reportedly said:
"You mean to tell me that the success of the economic program and my reelection hinges on the Federal Reserve and a bunch of fxxxing bond traders?" (See Agenda by Bob Woodward)

No Retreat, No Surrender? There's no room for pacifists in this war. Clearly, Wall Street and its global minions are not seeking a truce. Instead, they're coming after our Social Security, Medicare and Medicaid programs. They want us to work longer before we retire and get less when we do. They want us to pay more for health care and get less of it. They want less public money to go to schools, teachers and public infrastructures. And they want us to get used to a jobless recovery with double digit unemployment rates. (And when millions and millions of people are unemployed, we can't maintain high labor standards, and our wages and benefits erode.) In short, they want to undermine all the policies and programs that have built and sustained middle class life.

Already government officials in the UK, Germany and here are telling us we must endure austerity for "decades to come." As Fed Chair Ben Bernanke candidly put it:

"We can see what problems can arise in a country if investors lose confidence in the fiscal position of that country, so it is very important that we address this problem."
Of course, he's not going to point out that this austerity is only for the masses, definitely not for the financial elites. Or that the underlying cause of the debt investors are so worried about is the giant economic crater caused by the very same financial elites who now might "lose confidence" in financing a middle class society.
We shouldn't kid ourselves about the pitched battles ahead. Fighting back won't be easy, and winning will be even harder. People in country after country will have to mobilize themselves in defense of real democracy, in defense of each nation's right to provide its people with a decent quality of life. In my opinion, that includes sustainable jobs with decent benefits and a solid public infrastructure that promotes equity, protects the vulnerable and enriches the environment.

Unfortunately, no one can guarantee that democracy will prevail in the war against financial theocracy -- just recall the totalitarian chaos in Europe during the Great Depression. But don't count it out, either. It's true that many of us regular folks have been diverted by the media, distracted by the Internet or lulled into a stupor by pharmaceuticals. But when we realize that we've been shoved into a corner with no way out, we'll act. A popular struggle will begin. And when it does, we'll at least have a fighting chance to recapture our democratic souls.

Crimes against sanity

Imagine a country under an embargo that causes great hardship to the population: it is the perfect environment for black market of course. Now imagine that 42 black marketeers are caught profiteering by raising the prices of staple goods in breach of state rules during the economic suffering that came with the embargo. Instead of a mild sentence, the 42 are summarily executed. A deplorable response to a deplorable act.
However cruel, would you call such punishment of 42 unlucky rascals “a crime against humanity”? I guess most sane people wouldn’t go that far. Yet, things are different if you are a US-supervised Iraqi court that must somehow punish a Saddam-era celebrity.
This is the case of Tariq Aziz, a well known figure in Saddam’s regime, who was surrendered to the US ‘coalition forces’ in 2003, shortly after Baghdad’s fall (the US military reciprocated by flying his family to the safety of Jordan -Timesonline). Aziz has been in detention without any conviction for almost 6 years. A few days ago, he was once again brought to court with some other Saddam’s aids and relatives; this time, the mouse was cought!
Let the mainstream news outlets tell you the story as they see fit:
Deutche Welle: “Two relatives of former Iraqi President Saddam Hussein have been sentenced to death for their roles in the killings of 42 merchants in 1992. The traders were executed after being accused of raising the prices of goods in breach of state price controls at a time when Iraq was under United Nations economic sanctions over its 1990 invasion of Kuwait. The judge at a Baghdad court said the two were guilty of crimes against humanity. Former deputy prime minister Tariq Aziz was also sentenced in connection with the event, but received a jail term.”
Deutsch Welle does not specify the length of Aziz’s jail term. CNN News is more illuminating in that ‘little’ detail, but quite vague about the basis of the sentence: “The men were sentenced for their roles in the 1992 execution of 42 merchants.” –not a single word about why those merchants were executed.
BBC News does cite the 15-year sentence and a few details about the summary trials of the 42 black marketeers. However, the term “crimes against humanity” is omitted, perhaps realizing the absurdity of such allegation.
It is interesting to note that all the news reports use the term ‘merchants’ to describe the 42, not ‘black marketeers’. But the issue here is not how the big media present the news. It is the fact that victor’s justice labels minor incidents like the swift trial of 42 crooks as “crimes against humanity”. It is distressing to see this over-used term becoming cheaper and weaker, drawing attention from other -more sinister and real- global crimes…

BTW, in case you are suspicious about the way Saddam’s Iraq has been portrayed by the brain-washers, you might like to check this
-it's a long page, so use Find: Iraq to jump to relevant parts.

Is there life after Bush?

It is impressive to have this kind of speech just a few weeks after the Bushit era!
So, there might be hope in America after all...

That's the spirit!

The ultimate symbol of consumerist non-sense:

Sony Releases New Stupid Piece Of Shit That Doesn't Fucking Work

Laughing vampires

Robert Fisk in The Independent, 20.01.09:

"The front page of the Beirut daily As-Safir said it all yesterday. Across the top was a terrible photograph of the bloated body of a Palestinian man newly discovered in the ruins of his home while two male members of his family shrieked and roared their grief. Below, at half the size, was a photograph from Israel of Western leaders joking with Ehud Olmert, the Israeli Prime Minister. Olmert was roaring with laughter. Silvio Berlusconi, arms on the back of Olmert's shoulders, was also joshing and roaring – with laughter, not grief – and on Olmert's right was Nicolas Sarkozy of France wearing his stupidest of smiles. Only Chancellor Merkel appeared to understand the moral collapse. No smiles from Germany."
[full article]

Numbers vs. bullshit

Next time you hear the repetitive argument about "the innocent Israelis that have been slaughtered by Palestinian terrorists" as a justification of any atrocity, just remember this simple graph [click on it for large size]:

European crocodiles

The mild display of ‘humanitarian sensitivity’ by the EU bosses on the Gaza slaughter reminds me of crocodile tears.
Just remember what happened in 2006, when the Palestinians dared to elect Hamas as their major political group in admittedly fair elections: In one more shameless illustration of Western hypocrisy, the ‘humanitarians’ of today suspended economic aid to the Palestinian Authority because Palestinians cast the ‘wrong’ vote!
The Guardian wrote on 11.4.06: "The EU yesterday increased the pressure on the Hamas-led Palestinian Authority to recognise Israel and renounce terrorist violence by suspending all direct aid to the new government. ... Aid organisations warned that the decision to cut off assistance would simply damage people living on about £1 a day and drive them further into the arms of extremists. Aid accounts for 25% of Palestinians' incomes."
You probably remember that, after a while, clashes started between Hamas and Fatah, in a classic example of Divide & Rule.
You see, the foreign ‘democrats’ wanted Fatah to win regardless of Palestinian voters will. The match finally ended in a draw, with Fatah dominating in West Bank and Hamas in Gaza.
The same hideous 'scribes and Pharisees' that 3 years ago used misery to blackmail refugees, come now and beg Israel politely to show self-restrain in dealing with the same disobedient ‘desperados’.
Some years ago, during the Albanian ‘genocide’ in Kosovo by the ‘blood-thirsty’ Serbs, they had demonstrated their humanitarian sensitivity much more vigorously, bombing for 78 days the ‘bad’ civilians of Belgrade and Novi Sad.
Now their concern can only reach up to theatrical appeals, equalizing Hamas home-made rockets with Israeli ‘smart’ bombs and 400 dead Palestinians with 4 dead Israelis…
Seriously, who has elected such ludicrous hypocrites that are supposed to represent us?
Or they just snatched the wheel without us knowing (like many others have done)?
.

It’s Nice to Be Rich

[NY Times editorial, published June 28, 2008]

Millionaires are already wildly overrepresented in Congress. The Supreme Court gave a big boost to rich candidates this week by striking down the “millionaire’s amendment,” which was designed to help level the playing field for candidates running against wealthy opponents... [read full text]

Reporting the future

[Originally posted here in 2001]

The year is 1990.
Margaret Thatcher & Michael Gorbachev are in full power.
Comrade Yeltsin is regularly portrayed as a pathetic drunkard by the Western media (not knowing yet how useful he would be soon, forcing them to reverse his image building).
President George Bush (Sr.) is preparing for the Gulf War against Saddam Hussein, his former ally against Iran (who just 3 years earlier had been pardoned when his Exocet missile hit US Navy frigate 'Stark' killing 37 American sailors).
The Berlin Wall has fallen just a few months ago, and the European Community has 12 member countries, still not merged into the European Union that will appear 3 years later.
The Soviet Union is on the map as it has been for 45 years, and so is Yugoslavia and the rest of Europe, East and West.

In that context, the November 26, 1990 issue of Newsweek magazine presents a special report on the future of Europe as seen by its reporters (Pascal Privat and Michael Meyer, Scott Sullivan, Fred Coleman, Daniel Pedersen & Andrew Nagorski).
The report includes the following two maps of Eastern Europe & Yugoslavia:

Click for larger size; notice 'new countries' and 'border disputes' as foreseen in 1990

The remarkable similarity to the present map of Europe and especially Yugoslavia, a decade later, can be explained by one of the following:

• The reporters had an impressive skill to foretell the future, perhaps using Tarot cards or other magic tricks.
• The reporters have been very lucky in their wild guess or wishful thinking.
• The reporters had very good connections to those that shape the New World Order today; thus they managed to obtain an outline of the goals set by those powerful circles, a plan that has been promoted with impressive persistence & efficiency during the subsequent decade.

The bloody 'chess game' in Yugoslavia during the '90s, the clever series of all too obvious 'forced moves' which lead to the demolition of an 80 years old federation that had been 'too independent', the extradition, trial, and sudden death of the defeated 'Black King', plus the recent Montenegro and Kosovo independence, are strong indications that the third interpretation cannot be too far from the truth...

Or do you believe in magic?

Myanmar and "bioclimatic" shelters

I’m sure you heard the news about Myanmar [Burma for those yearning for the nostalgic past].
Here are a few reminding photos from Yahoo…

A few months ago, ARES-UIA competition jury selected the scheme shown below as the best answer to natural disasters, using “Renewable energy sources and bioclimatic architecture for shells, to shelter people affected by natural disasters”.

According to its designers, the scheme can be adapted to different regions of the world by changing the fabric colour; for Myanmar type of environment, green canvas is suggested.

The current humanitarian crisis of more than a million homeless people in Myanmar is a good test for the suitability of the selected design.

In this case, about 150-200,000 units from a prefabricated stock somewhere in the world should be flown to Yangon, and then transported by a fleet of trucks to the affected areas (care should be taken to send green units only, not yellow or blue ones which are for different climatic regions).
Legions of IKEA-trained specialists should accompany the shipments in order to unpack and assemble the units on site after the flooded land is dry again.
Once the costly PV panels and their batteries are in place, the lucky ex-homeless will be able to watch their favourite TV show in order to burry their grief.
Shortages of drinkable water or the danger of epidemics will be addressed by the ultra hi-tech sanitation compartments contained in each individual unit.
As for financial relief, the penniless refugees could fetch a good price for those expensive PV panels and batteries (before being blown away by the next storm).

Now, isn't that holistic sustainable design indeed?

A letter

This is a message that I emailed few days ago; whoever agrees with its contents should send a similar -or copy/paste- message to Mrs. Ferrer-Walder and other EU personae [see EU Parliament members list]. Remember, 'apathy is the fertilizer of intimidation'


To Mrs. Benita Ferrero-Waldner
Commissioner for External Relations
European Union


Madam,

This is to strongly protest against the recent European Commission’s disgraceful decision to suspend direct economic aid to the Palestinian Authority because of the Hamas agenda.

The fact is that the Hamas platform –like it or not- reflects the will of the majority of Palestinian voters, a fact that the Commission must acknowledge if its members truly accept the principles of democracy.

It is more than obvious that the Commission’s act has no other aim than to increase the misery of Palestinian people –as if they do not suffer enough already- in the hope that they will cancel their January vote and replace their elected representatives with others more of the Commission’s liking.

In case the Commission insists on that shameful blackmailing, there can be no doubt that its members want to impose their own views upon the Palestinian electorate, either because they believe that they have the right to do so in a good-old colonialist manner, or because they have actually turned the EU into a willing instrument of Israeli policy.

Until the EU decision is withdrawn, allow me to believe that the democratic rhetoric in Middle East or elsewhere is just a selective fig leaf to cover an immense hypocrisy.