By Robert B. Reich
July 10, 2009 "Robert Reich's Blog" -- -The so-called "green shoots" of recovery are turning brown in the scorching summer sun. In fact, the whole debate about when and how a recovery will begin is wrongly framed. On one side are the V-shapers who look back at prior recessions and conclude that the faster an economy drops, the faster it gets back on track. And because this economy fell off a cliff late last fall, they expect it to roar to life early next year. Hence the V shape.
Unfortunately, V-shapers are looking back at the wrong recessions. Focus on those that started with the bursting of a giant speculative bubble and you see slow recoveries. The reason is asset values at bottom are so low that investor confidence returns only gradually.
That's where the more sober U-shapers come in. They predict a more gradual recovery, as investors slowly tiptoe back into the market.
Personally, I don't buy into either camp. In a recession this deep, recovery doesn't depend on investors. It depends on consumers who, after all, are 70 percent of the U.S. economy. And this time consumers got really whacked. Until consumers start spending again, you can forget any recovery, V or U shaped.
Problem is, consumers won't start spending until they have money in their pockets and feel reasonably secure. But they don't have the money, and it's hard to see where it will come from. They can't borrow. Their homes are worth a fraction of what they were before, so say goodbye to home equity loans and refinancings. One out of ten home owners is under water -- owing more on their homes than their homes are worth. Unemployment continues to rise, and number of hours at work continues to drop. Those who can are saving. Those who can't are hunkering down, as they must.
Eventually consumers will replace cars and appliances and other stuff that wears out, but a recovery can't be built on replacements. Don't expect businesses to invest much more without lots of consumers hankering after lots of new stuff. And don't rely on exports. The global economy is contracting.
My prediction, then? Not a V, not a U. But an X. This economy can't get back on track because the track we were on for years -- featuring flat or declining median wages, mounting consumer debt, and widening insecurity, not to mention increasing carbon in the atmosphere -- simply cannot be sustained.
The X marks a brand new track -- a new economy. What will it look like? Nobody knows. All we know is the current economy can't "recover" because it can't go back to where it was before the crash. So instead of asking when the recovery will start, we should be asking when and how the new economy will begin. More on this to come.
Patron Saint of Blog
St. Thomas by Fra Angelica
Key Elements of Each Moral Act (Moral Philosophy of Aristotle/Aquinas)
The Nature of Morality qua Philosophy
Saturday, July 11, 2009
Tuesday, July 7, 2009
Iraq a Failed Imperialist Venture
By Haroon Siddiqui
July 03, 2009 "The (Toronto) Star" -- American troops were not welcomed with flowers in Iraq but their departure from cities and towns has been.
Iraqis celebrated National Sovereignty Day Tuesday as U.S. troops were yanked out of populated centres and put into remote bases.
In time, even that hidden presence will begin to grate on the Iraqis, just as a U.S. military base in Saudi Arabia had spurred Osama bin Laden and others.
Yet this limited troop pullout is being hailed as a triumph. One is reminded of Richard Nixon's 1973 boast of "peace with honour" in Vietnam. The 1973 Paris treaty that led to the U.S. troop withdrawal was a face-saving formula.
In Iraq, too, the U.S. has little choice but to get out.
Not only did the Iraqi invasion and occupation prove the limits of military power, it also exposed how incapable America has become at nation-building. Its postwar incompetence was stunning.
America plunged Iraq into chaos, shattered the infrastructure and destroyed the society, reducing human beings to their basest instincts. They turned on each other and found safety only in family, tribe, clan and sect. Shiites and Sunnis, who had lived together for ages, ethnically cleansed each other's neighbourhoods, which to this day remain separated by barricades, walls and checkpoints.
Having unleashed the forces that put Iraq's three main communities at war with each other, the U.S. toyed with the idea of dividing the country into the Kurdish north, a Sunni centre and a Shiite south, much like the British had divided India in two in 1947.
Having created the chaos, violence and jihadism, the U.S. said, in colonial fashion, it had to stay to curb the chaos, violence and jihadism. Having crippled the state, it had no choice but to prolong the occupation until the natives were ready to govern themselves.
Iraq exhausted America more than the 1917-32 British invasion and occupation sapped the British. It also created killing fields on a vast scale.
Yet Iraqis have been brushed out of the American narrative – Iraq is free of Saddam Hussein, it is democratic, it is stabilized, it is this and it is that.
There's nary a mention of how many Iraqis are dead (between 100,000 and 1.2 million, depending on who's counting), how many maimed (not known), how many displaced (4 million), and how many tortured with Saddam-like methods in Abu Ghraib and elsewhere (not known).
Besides the damage to U.S. credibility, and not just in the Muslim world, the Iraq adventure empowered Iran far more than the U.S. would ever acknowledge.
Finally, the quest for oil may also turn out to be a mirage.
This week, Iraq's oil minister, Hussain al-Shahristani, a U of T graduate, put development rights up for international bidding. No more no-bid contracts for U.S. firms, unlike under the Bush-Cheney domain.
Nor did George W. and Dick get what they wanted out of the Status of Forces Agreement. Passed by the Iraqi parliament last fall, it stipulates that all U.S. troops must be out by Dec. 31, 2011. No U.S. military operation can be carried out without Iraqi consent (a provision Hamid Karzai can only dream of). Iraqi soil cannot be used by the U.S. to launch a war on any neighbour (Iran).
Iraq is the imperial adventure that both Stephen Harper and Michael Ignatieff, one a neo-con hawk and the other a liberal hawk, fully backed. A monumental failure in judgment, their common stance was, and remains, an affront to the collective will of Canadians.
July 03, 2009 "The (Toronto) Star" -- American troops were not welcomed with flowers in Iraq but their departure from cities and towns has been.
Iraqis celebrated National Sovereignty Day Tuesday as U.S. troops were yanked out of populated centres and put into remote bases.
In time, even that hidden presence will begin to grate on the Iraqis, just as a U.S. military base in Saudi Arabia had spurred Osama bin Laden and others.
Yet this limited troop pullout is being hailed as a triumph. One is reminded of Richard Nixon's 1973 boast of "peace with honour" in Vietnam. The 1973 Paris treaty that led to the U.S. troop withdrawal was a face-saving formula.
In Iraq, too, the U.S. has little choice but to get out.
Not only did the Iraqi invasion and occupation prove the limits of military power, it also exposed how incapable America has become at nation-building. Its postwar incompetence was stunning.
America plunged Iraq into chaos, shattered the infrastructure and destroyed the society, reducing human beings to their basest instincts. They turned on each other and found safety only in family, tribe, clan and sect. Shiites and Sunnis, who had lived together for ages, ethnically cleansed each other's neighbourhoods, which to this day remain separated by barricades, walls and checkpoints.
Having unleashed the forces that put Iraq's three main communities at war with each other, the U.S. toyed with the idea of dividing the country into the Kurdish north, a Sunni centre and a Shiite south, much like the British had divided India in two in 1947.
Having created the chaos, violence and jihadism, the U.S. said, in colonial fashion, it had to stay to curb the chaos, violence and jihadism. Having crippled the state, it had no choice but to prolong the occupation until the natives were ready to govern themselves.
Iraq exhausted America more than the 1917-32 British invasion and occupation sapped the British. It also created killing fields on a vast scale.
Yet Iraqis have been brushed out of the American narrative – Iraq is free of Saddam Hussein, it is democratic, it is stabilized, it is this and it is that.
There's nary a mention of how many Iraqis are dead (between 100,000 and 1.2 million, depending on who's counting), how many maimed (not known), how many displaced (4 million), and how many tortured with Saddam-like methods in Abu Ghraib and elsewhere (not known).
Besides the damage to U.S. credibility, and not just in the Muslim world, the Iraq adventure empowered Iran far more than the U.S. would ever acknowledge.
Finally, the quest for oil may also turn out to be a mirage.
This week, Iraq's oil minister, Hussain al-Shahristani, a U of T graduate, put development rights up for international bidding. No more no-bid contracts for U.S. firms, unlike under the Bush-Cheney domain.
Nor did George W. and Dick get what they wanted out of the Status of Forces Agreement. Passed by the Iraqi parliament last fall, it stipulates that all U.S. troops must be out by Dec. 31, 2011. No U.S. military operation can be carried out without Iraqi consent (a provision Hamid Karzai can only dream of). Iraqi soil cannot be used by the U.S. to launch a war on any neighbour (Iran).
Iraq is the imperial adventure that both Stephen Harper and Michael Ignatieff, one a neo-con hawk and the other a liberal hawk, fully backed. A monumental failure in judgment, their common stance was, and remains, an affront to the collective will of Canadians.
Sunday, July 5, 2009
How to Deal with America's Empire of Bases A Modest Proposal for Garrisoned Lands
By Chalmers Johnson
July 03, 2009 "TomDispatch" --- The U.S. Empire of Bases -- at $102 billion a year already the world's costliest military enterprise -- just got a good deal more expensive. As a start, on May 27th, we learned that the State Department will build a new "embassy" in Islamabad, Pakistan, which at $736 million will be the second priciest ever constructed, only $4 million less, if cost overruns don't occur, than the Vatican-City-sized one the Bush administration put up in Baghdad. The State Department was also reportedly planning to buy the five-star Pearl Continental Hotel (complete with pool) in Peshawar, near the border with Afghanistan, to use as a consulate and living quarters for its staff there.
Unfortunately for such plans, on June 9th Pakistani militants rammed a truck filled with explosives into the hotel, killing 18 occupants, wounding at least 55, and collapsing one entire wing of the structure. There has been no news since about whether the State Department is still going ahead with the purchase.
Whatever the costs turn out to be, they will not be included in our already bloated military budget, even though none of these structures is designed to be a true embassy -- a place, that is, where local people come for visas and American officials represent the commercial and diplomatic interests of their country. Instead these so-called embassies will actually be walled compounds, akin to medieval fortresses, where American spies, soldiers, intelligence officials, and diplomats try to keep an eye on hostile populations in a region at war. One can predict with certainty that they will house a large contingent of Marines and include roof-top helicopter pads for quick get-aways.
While it may be comforting for State Department employees working in dangerous places to know that they have some physical protection, it must also be obvious to them, as well as the people in the countries where they serve, that they will now be visibly part of an in-your-face American imperial presence. We shouldn't be surprised when militants attacking the U.S. find one of our base-like embassies, however heavily guarded, an easier target than a large military base.
And what is being done about those military bases anyway -- now close to 800 of them dotted across the globe in other people's countries? Even as Congress and the Obama administration wrangle over the cost of bank bailouts, a new health plan, pollution controls, and other much needed domestic expenditures, no one suggests that closing some of these unpopular, expensive imperial enclaves might be a good way to save some money.
Instead, they are evidently about to become even more expensive. On June 23rd, we learned that Kyrgyzstan, the former Central Asian Soviet Republic which, back in February 2009, announced that it was going to kick the U.S. military out of Manas Air Base (used since 2001 as a staging area for the Afghan War), has been persuaded to let us stay. But here's the catch: In return for doing us that favor, the annual rent Washington pays for use of the base will more than triple from $17.4 million to $60 million, with millions more to go into promised improvements in airport facilities and other financial sweeteners. All this because the Obama administration, having committed itself to a widening war in the region, is convinced it needs this base to store and trans-ship supplies to Afghanistan.
I suspect this development will not go unnoticed in other countries where Americans are also unpopular occupiers. For example, the Ecuadorians have told us to leave Manta Air Base by this November. Of course, they have their pride to consider, not to speak of the fact that they don't like American soldiers mucking about in Colombia and Peru. Nonetheless, they could probably use a spot more money.
And what about the Japanese who, for more than 57 years, have been paying big bucks to host American bases on their soil? Recently, they reached a deal with Washington to move some American Marines from bases on Okinawa to the U.S. territory of Guam. In the process, however, they were forced to shell out not only for the cost of the Marines' removal, but also to build new facilities on Guam for their arrival. Is it possible that they will now take a cue from the government of Kyrgyzstan and just tell the Americans to get out and pay for it themselves? Or might they at least stop funding the same American military personnel who regularly rape Japanese women (at the rate of about two per month) and make life miserable for whoever lives near the 38 U.S. bases on Okinawa. This is certainly what the Okinawans have been hoping and praying for ever since we arrived in 1945.
In fact, I have a suggestion for other countries that are getting a bit weary of the American military presence on their soil: cash in now, before it's too late. Either up the ante or tell the Americans to go home. I encourage this behavior because I'm convinced that the U.S. Empire of Bases will soon enough bankrupt our country, and so -- on the analogy of a financial bubble or a pyramid scheme -- if you're an investor, it's better to get your money out while you still can.
This is, of course, something that has occurred to the Chinese and other financiers of the American national debt. Only they're cashing in quietly and slowly in order not to tank the dollar while they're still holding onto such a bundle of them. Make no mistake, though: whether we're being bled rapidly or slowly, we are bleeding; and hanging onto our military empire and all the bases that go with it will ultimately spell the end of the United States as we know it.
Count on this, future generations of Americans traveling abroad decades from now won't find the landscape dotted with near-billion-dollar "embassies."
July 03, 2009 "TomDispatch" --- The U.S. Empire of Bases -- at $102 billion a year already the world's costliest military enterprise -- just got a good deal more expensive. As a start, on May 27th, we learned that the State Department will build a new "embassy" in Islamabad, Pakistan, which at $736 million will be the second priciest ever constructed, only $4 million less, if cost overruns don't occur, than the Vatican-City-sized one the Bush administration put up in Baghdad. The State Department was also reportedly planning to buy the five-star Pearl Continental Hotel (complete with pool) in Peshawar, near the border with Afghanistan, to use as a consulate and living quarters for its staff there.
Unfortunately for such plans, on June 9th Pakistani militants rammed a truck filled with explosives into the hotel, killing 18 occupants, wounding at least 55, and collapsing one entire wing of the structure. There has been no news since about whether the State Department is still going ahead with the purchase.
Whatever the costs turn out to be, they will not be included in our already bloated military budget, even though none of these structures is designed to be a true embassy -- a place, that is, where local people come for visas and American officials represent the commercial and diplomatic interests of their country. Instead these so-called embassies will actually be walled compounds, akin to medieval fortresses, where American spies, soldiers, intelligence officials, and diplomats try to keep an eye on hostile populations in a region at war. One can predict with certainty that they will house a large contingent of Marines and include roof-top helicopter pads for quick get-aways.
While it may be comforting for State Department employees working in dangerous places to know that they have some physical protection, it must also be obvious to them, as well as the people in the countries where they serve, that they will now be visibly part of an in-your-face American imperial presence. We shouldn't be surprised when militants attacking the U.S. find one of our base-like embassies, however heavily guarded, an easier target than a large military base.
And what is being done about those military bases anyway -- now close to 800 of them dotted across the globe in other people's countries? Even as Congress and the Obama administration wrangle over the cost of bank bailouts, a new health plan, pollution controls, and other much needed domestic expenditures, no one suggests that closing some of these unpopular, expensive imperial enclaves might be a good way to save some money.
Instead, they are evidently about to become even more expensive. On June 23rd, we learned that Kyrgyzstan, the former Central Asian Soviet Republic which, back in February 2009, announced that it was going to kick the U.S. military out of Manas Air Base (used since 2001 as a staging area for the Afghan War), has been persuaded to let us stay. But here's the catch: In return for doing us that favor, the annual rent Washington pays for use of the base will more than triple from $17.4 million to $60 million, with millions more to go into promised improvements in airport facilities and other financial sweeteners. All this because the Obama administration, having committed itself to a widening war in the region, is convinced it needs this base to store and trans-ship supplies to Afghanistan.
I suspect this development will not go unnoticed in other countries where Americans are also unpopular occupiers. For example, the Ecuadorians have told us to leave Manta Air Base by this November. Of course, they have their pride to consider, not to speak of the fact that they don't like American soldiers mucking about in Colombia and Peru. Nonetheless, they could probably use a spot more money.
And what about the Japanese who, for more than 57 years, have been paying big bucks to host American bases on their soil? Recently, they reached a deal with Washington to move some American Marines from bases on Okinawa to the U.S. territory of Guam. In the process, however, they were forced to shell out not only for the cost of the Marines' removal, but also to build new facilities on Guam for their arrival. Is it possible that they will now take a cue from the government of Kyrgyzstan and just tell the Americans to get out and pay for it themselves? Or might they at least stop funding the same American military personnel who regularly rape Japanese women (at the rate of about two per month) and make life miserable for whoever lives near the 38 U.S. bases on Okinawa. This is certainly what the Okinawans have been hoping and praying for ever since we arrived in 1945.
In fact, I have a suggestion for other countries that are getting a bit weary of the American military presence on their soil: cash in now, before it's too late. Either up the ante or tell the Americans to go home. I encourage this behavior because I'm convinced that the U.S. Empire of Bases will soon enough bankrupt our country, and so -- on the analogy of a financial bubble or a pyramid scheme -- if you're an investor, it's better to get your money out while you still can.
This is, of course, something that has occurred to the Chinese and other financiers of the American national debt. Only they're cashing in quietly and slowly in order not to tank the dollar while they're still holding onto such a bundle of them. Make no mistake, though: whether we're being bled rapidly or slowly, we are bleeding; and hanging onto our military empire and all the bases that go with it will ultimately spell the end of the United States as we know it.
Count on this, future generations of Americans traveling abroad decades from now won't find the landscape dotted with near-billion-dollar "embassies."
Silencing the Saber-Rattling: How the American Empire Threatens the Potential Iranian Counter-Revolution
by Paul David Collins, July 4th, 2009
Illuminati Conspiracy Archive
original HERE...
John Loftus proved to be a treasure chest of information over the Middle East during an interview with this writer on March 21, 2009. In little over an hour, the former Justice Department prosecutor and former Army intelligence officer addressed the issues of postwar Nazi activity, the September 11 attacks, and fanaticism in the Arab world. The most fascinating information Loftus shared, however, concerns Iran.
The Central Eurasian Islamic Republic has been a hot topic for many observers of the international political landscape ever since Bush II referred to it as part of an “axis of evil” during his January 29, 2002 State of the Union speech. That speech helped create an absolutely schizophrenic political climate filled with saber-rattling and war-fever that has held sway for the last seven years. During that period of time, rumors of an invasion of Iran have periodically surfaced, causing people in both America and Iran to oscillate between anxiety and sighs of relief. Former CIA case officer Robert Baer has referred to Iran as “the third rail of American foreign policy in the world” (Interview: Robert Baer). It is the country that every administration has dared not touch since 1979. With Iran on the verge of possessing a nuclear power program, however, avoidance may no longer be an option. What will be Iran’s fate? For Loftus, the tide of history will soon make an invasion of Iran completely unnecessary.
“I believe the government will eventually collapse and Iran will return to democracy,” Loftus told this writer. “The clock will turn back to the way things were before the 1953 coup.”
Of course, this statement raised an eyebrow. “Do you mean to say another Mossadegh will rise,” I asked.
“Yes,” Loftus responded. (Loftus)
For many years now, Iran has put up a strong front that made Loftus’ words hard to swallow. The Islamic republic sees itself as a revived Persian Empire, and it has gained a considerable amount of regional influence. A 2008 poll conducted by the University of Maryland found that Iranian President Mahmoud Ahmadinejad was the second most admired leader across the Arab world (“Nasrallah most admired Arab leader”). The only leader to outshine Ahmadinejad in the poll was Seyyed Hassan Nasrallah, the leader of Iranian proxy Hezbollah (ibid). Needless to say, regional support for Iran is strong.
Underneath the tough exterior, however, hides several serious problems that have begun to boil over. Problems began to appear in the middle of the 1990s when a 1996 census revealed that Iran’s fertility rates “were less than one-half of the figure obtained from the previous census” (Mehryar and Aghajanian). A large-scale survey conducted in 2000 was less promising in its findings. That survey found “that total fertility rates of Iranian couples had dropped to 2.0” (ibid). The survey also found that 14 of the 28 provinces surveyed were well below the 2.1 replacement level (ibid). A 2006 census was probably the most dismal. Of the 30 major provinces in Iran, 27 provinces “would seem to have reached below replacement fertility, with TFR [total fertility rates] values ranging from 1.15 to 1.95” (ibid). The data presented by the 2006 census indicated that “over 80% of the population of Iran belong to provinces with clearly below replacement fertility rate” (ibid).
Can Iran rely on young people of marrying age to rectify the baby dearth? According to writer Azadeh Moaveni, the answer is “no.” In a June 9, 2009 Time magazine article, Moaveni stated:
By official estimates, there are currently 13 million to 15 million Iranians of marrying age; to keep that figure steady, Iran should be registering about 1.65 million marriages each year. The real figure is closer to half of that. (Moaveni)
Why has the number of marriages dropped so drastically? According to Moaveni, economic conditions in Iran do not make marriage feasible. Inflation hit a whopping 25.9 percent in February 2009 (“Iran inflation hits 25.9%: Reports”). While that figure is lower than the September 2008 of 29 percent, it was still high enough to cause concern for Iran’s central bank chief Mahmoud Bahmani, who promised to slash inflation by almost 4 percent before the end of the Iranian year on March 20 (ibid). In early June 2009 there were some signs of improvement, with inflation falling to 23. 6 percent (“Iran inflation falls below 24 percent”). The number is still far too high, however, to accommodate a new couple desiring to start a family.
The inflation drop was also far too little, too late for Ahmedinejad’s political health. The Iranian president’s election rivals, such as reformist candidate Mehdi Karroubi, capitalized on the poor economic environment and blamed Ahmedinejad for encouraging inflation (ibid). Was Karroubi and the rest of the opposition way off the mark with their accusation? Again, Iran views itself as a revival of the Persian Empire, and Ahmedinejad certainly holds imperialist aspirations. In the quest for empire, Ahmedinejad has initiated several reckless expansionary economic policies. One of the results of this policy was Ahmedinejad’s proposed budget in January 2009 of 282.7 billion dollars with a deficit forecast of 44 billion dollars (“Iran inflation hits 25.9: Reports”). Can any country long stand such an orgiastic spending spree?
Probably one of the most serious problems currently facing Iran is low crude oil prices. Gholamhossein Nozari, Iran’s current Oil Minister, predicted oil prices “will hover at the $40 mark in 2009” (Avro). This prompted Nozari’s ministry to tell the government “to set the price of oil at that amount in its upcoming 2009-2010 budget” (ibid). According to Samuel R. Avro, these low prices “could eventually bring out the disgust of the Iranian public against the current regime which may then lead to destabilization and perhaps a halt to their nuclear program” (ibid). Bush’s CIA Director Michael Hayden also expressed this opinion, stating that Iran’s low oil prices “removes a buffer that will cause the natural stressors in Iranian society to become more pronounced” (ibid).
While the problems facing Iran are lamentable, they did set the stage for self-correction to occur in the Islamic Republic. The situation is beginning to right itself as more and more Iranians conclude that the country’s leadership lacks the ability and the desire to solve the problems. People began expressing their dissatisfaction with the current regime shortly after Iran’s tenth presidential election on June 12, 2009. The next day, opponents of Ahmedinejad took to the streets and began protesting, some violently (Johnson and Murphy). As we shall see, some of these protestors may have been part of an organized destabilization campaign. That being said, the number of people in the streets was far too high for everyone to be surrogates of Western intelligence agencies, a contention some of the more extreme conspiracists seem to be pushing. The crowds included many sincere Iranian citizens with legitimate grievances.
It’s important to note that many of the activists made the mistake of elevating Ahmedinejad’s main rival, Mir Hossein Mousavi, into a hero from which they derive inspiration. Behind Mousavi’s emergent messianic mystique hides a terrorist and criminal who is no better than Ahmedinejad. During his time as Iran’s prime minister in the 1980s, Mousavi was the supervisor of a terrorist campaign against the West that included the infamous attacks on the U.S. embassy and Marine Corps barracks in Beirut (Stein). According to former CIA case officer Robert Baer, Mousavi “oversaw an office that ran operatives abroad, from Lebanon to Kuwait to Iraq” (ibid). Baer places Mousavi in direct contact with Imad Mughniyah, the individual responsible for conducting the Beirut attack (ibid). Retired Navy Admiral and “father” of the Navy SEAL’s Red Cell counter-terror unit James “Ace” Lyons has also identified Mousavi as the mastermind behind the 1988 truck bomb attack on the U.S. Navy’s Fleet Center in Naples, Italy (ibid). That terrorist action resulted in the deaths of five people (ibid).
Given his criminal and terrorist background, it’s obvious that Mousavi represents the status quo in Iran, not change. Still it is important to note that Mousavi was able to build an impressive support base by presenting himself as a reformer and running on a reformist platform. These seems to indicate that many Iranians desire positive change and are now willing to express that desire.
A counter-revolution that will reverse the effects of the 1979 Iranian Revolution seems to be in the embryonic stage right now. Only one thing could reverse that trend: interference and intrusion on the part of the American Empire. If an American destabilization campaign were to be detected or exposed, internal contention would disappear and the people would again be galvanized behind Ahmadinejad. This potentiality is very real. Unfortunately, the American Empire’s interventionist spirit is alive and well and evidence suggests that it may be at work in Iran.
In May 2007, intelligence sources revealed to the UK Telegraph that President George W. Bush had given the CIA “approval to launch covert ‘black’ operations to achieve regime change in Iran” (Shipman). This approval, according to the Telegraph, appeared in a “non-lethal presidential finding” and authorized “CIA plans for a propaganda and disinformation campaign intended to destabilize, and eventually topple, the theocratic rule of the mullahs” (ibid). The presidential directive also endorsed the supply of communications equipment to opposition groups in Iran (ibid). This equipment would allow such groups to network with one another and coordinate destabilization plans more effectively (ibid).
The Telegraph’s revelations carried both negative and positive implications. On the positive, the directive prohibited the CIA from using lethal force (ibid). This can be interpreted to mean that Bush was moving away from the influence of Vice President Richard Cheney and his neoconservative allies who favor a military strike (ibid). However, the revelations had also shown that the President had not abandoned interventionist policies that could instigate hostilities with Iran.
When power traded hands from Bush to Obama, the approach to dealing with Iran seemed to change. Obama’s handlers among the power elite seemed to prefer attempting to recruit Iran to fight the American Empire’s other enemies. Imperial recruitment, euphemistically referred to as “diplomacy,” was heavily promoted in the early days of the Obama Administration. There is evidence, however, that destabilization efforts have continued. Perhaps the current administration believes that destabilization efforts will lead to a weakened Iran that is more willing to deal. Perhaps the administration has just grown frustrated with trying to reach out to a stubborn and skeptical nation. Whatever the case may be, aspects of the 2009 Iranian election fallout suggests the invisible hand of the American Empire at play.
On Saturday, June 20, 2009, Iran’s security apparatus reportedly discovered and arrested a large contingent of rioters in Tehran who were members of the Mujahideen-e-Khalq organization, or MEK (“Iran finds US-backed MKO fingermarks in riots”). Iranian security officials claimed that the MEK members “confessed that they were extensively trained in Iraq’s camp Ashraf to create post-election mayhem in the country” (ibid). The MEK members were also allegedly receiving instruction from the dissident group’s command post in Britain (ibid).
On the same day that the MEK rioters were arrested, the group’s leader Maryam Rajavis gave her official endorsement to election protestors and even went so far as to declare the MEK the real election victors (ibid).
Was the MEK acting as a surrogate of the American Empire? In July of 2008, respected journalist Seymour Hersh was told by a Pentagon consultant that the MEK might receive covert funds from the United States in order to help destabilize Iran (Hersh). The Iranian dissident group has received arms and intelligence from Western intelligence groups in recent years and possesses an enduring relationship with the CIA and Special Operations communities in spite of its inclusion on the State Department’s terrorist list for more than a decade (ibid). If MEK participation in the riots and protests prove to be a genuine example of American interference, it could threaten the chance of a successful counter-revolution.
Left to its own devices, Iran’s ruling establishment will commit political suicide. The Iranian people have simply lost too much confidence in the president, the mullahs, and the government’s way of doing things for the last three decades. American interventionism can not contribute one iota to the current regime’s trip on history’s exit ramp. If anything, black ops, destabilization campaigns, and ridiculous cloak and dagger schemes and conspiracies to “liberate” Iran will give the current regime a new lease on life. The American Empire is providing Iran’s ruling establishment with an existential threat that justifies its political survival. Iranians are starting to wake up and see Ahmadinejad for the mentally unstable tyrant he is. American meddling in Iranian affairs, however, would lend itself to a public relations spin that would portray Ahmadinejad as a populist hero doing battle with the “Great Satan.” Interference would destroy the receptivity of the Iranian people to change and lead to more hostility.
Perhaps a perpetually hostile and dangerous Iran is exactly what many among the power elite crave. These oligarchical Hegelian activists need a world full of bogeymen, fanatics, and dictatorial strongmen to maintain history’s march toward a new world order. At least one member of the neoconservative faction of the elite, Daniel Pipes, has expressed such sentiments. During a June 3, 2009 meeting held by the neoconservative Heritage Foundation, Pipes stated that if he were to participate in Iran’s election, he would, “with due hesitance,” vote for Ahmadinejad because the current Iranian president is “an enemy who’s forthright and obvious, who wakes people up with his outlandish statements” (“New Thinking for Old Problems: The Challenges of Middle East Peacemaking in the Shadow of the Iranian Threat”).
The dialectical climate proposed by Pipes will not lead to what the neoconservative Francis Fukuyama called “The End of History,” but it may lead to what Jesus Christ called “the beginning of sorrows” (Matthew 24:8). While Iran is certainly not the juggernaut the neoconservatives have portrayed it as, the overstretched American Empire is in no condition to tackle a third war. The Lord has designed the universe to take out its own garbage. It does not require the American Empire acting as its waste management surrogate.
Is there any meaningful contribution America can make to Iran’s nascent counter-revolution? America can aid the Iranians by helping itself. It can dismantle its bloated and overstretched empire and return to its constitutional roots as a democratic republic. Such a move would send a clear message to Iran. In effect, America will be saying, “We tried empire and it bankrupted us economically and morally. It’s weakened our military and left us in a weakened state. For the sake of your own country, don’t explore this imperial road further.” There is a good chance Iran would follow America’s example. Then, and only then, will the saber-rattling finally be silenced.
Sources Cited
* Avro, Samuel. "CIA: Low Oil Prices Place Pressure on Iran, Venezuela." Consumer Energy Report 18 January 2009
* Hersh, Seymour. "Preparing the Battlefield." The New Yorker 7 July 2008
* "Interview: Robert Baer." Frontline 22 March 2002
* "Iran finds US-backed MKO fingermarks in riots" Press TV 21 June 2009
* "Iran inflation falls below 24 percent." Television Washington 7 June 2009
* "Iran inflation hits 25.9%: Reports." The ARY News 8 March 2009
* Johnson, Anna and Brian Murphy. "Election Battle Turns Into Street Fights in Iran." ABC News 13 June 2009
* Loftus, John. Telephone interview. 21 March 2009.
* Mehryar, Amir and Akbar Aghajanian. "Below Replacement Fertility in Iran: A District Level Analysis of 2006 Census." Princeton University 2009
* Moaveni, Azadeh. "Will Iran's 'Marriage Crisis' Bring Down Ahmadinejad?" Time 9 June 2009
* "Nasrallah most admired Arab leader." Press TV 17 April 2008
* "New Thinking for Old Problems: The Challenges of Middle East Peacemaking in the Shadow of the Iranian Threat." The Heritage Foundation 3 June 2009
* Shipman, Tim. "Bush sanctions 'black ops' against Iran." The London Telegraph 27 May 2007
* Stein, Jeff. "Mousavi, Celebrated in Iranian Protests, was the Butcher of Beirut." CQ Politics 22 June 2009
Illuminati Conspiracy Archive
original HERE...
John Loftus proved to be a treasure chest of information over the Middle East during an interview with this writer on March 21, 2009. In little over an hour, the former Justice Department prosecutor and former Army intelligence officer addressed the issues of postwar Nazi activity, the September 11 attacks, and fanaticism in the Arab world. The most fascinating information Loftus shared, however, concerns Iran.
The Central Eurasian Islamic Republic has been a hot topic for many observers of the international political landscape ever since Bush II referred to it as part of an “axis of evil” during his January 29, 2002 State of the Union speech. That speech helped create an absolutely schizophrenic political climate filled with saber-rattling and war-fever that has held sway for the last seven years. During that period of time, rumors of an invasion of Iran have periodically surfaced, causing people in both America and Iran to oscillate between anxiety and sighs of relief. Former CIA case officer Robert Baer has referred to Iran as “the third rail of American foreign policy in the world” (Interview: Robert Baer). It is the country that every administration has dared not touch since 1979. With Iran on the verge of possessing a nuclear power program, however, avoidance may no longer be an option. What will be Iran’s fate? For Loftus, the tide of history will soon make an invasion of Iran completely unnecessary.
“I believe the government will eventually collapse and Iran will return to democracy,” Loftus told this writer. “The clock will turn back to the way things were before the 1953 coup.”
Of course, this statement raised an eyebrow. “Do you mean to say another Mossadegh will rise,” I asked.
“Yes,” Loftus responded. (Loftus)
For many years now, Iran has put up a strong front that made Loftus’ words hard to swallow. The Islamic republic sees itself as a revived Persian Empire, and it has gained a considerable amount of regional influence. A 2008 poll conducted by the University of Maryland found that Iranian President Mahmoud Ahmadinejad was the second most admired leader across the Arab world (“Nasrallah most admired Arab leader”). The only leader to outshine Ahmadinejad in the poll was Seyyed Hassan Nasrallah, the leader of Iranian proxy Hezbollah (ibid). Needless to say, regional support for Iran is strong.
Underneath the tough exterior, however, hides several serious problems that have begun to boil over. Problems began to appear in the middle of the 1990s when a 1996 census revealed that Iran’s fertility rates “were less than one-half of the figure obtained from the previous census” (Mehryar and Aghajanian). A large-scale survey conducted in 2000 was less promising in its findings. That survey found “that total fertility rates of Iranian couples had dropped to 2.0” (ibid). The survey also found that 14 of the 28 provinces surveyed were well below the 2.1 replacement level (ibid). A 2006 census was probably the most dismal. Of the 30 major provinces in Iran, 27 provinces “would seem to have reached below replacement fertility, with TFR [total fertility rates] values ranging from 1.15 to 1.95” (ibid). The data presented by the 2006 census indicated that “over 80% of the population of Iran belong to provinces with clearly below replacement fertility rate” (ibid).
Can Iran rely on young people of marrying age to rectify the baby dearth? According to writer Azadeh Moaveni, the answer is “no.” In a June 9, 2009 Time magazine article, Moaveni stated:
By official estimates, there are currently 13 million to 15 million Iranians of marrying age; to keep that figure steady, Iran should be registering about 1.65 million marriages each year. The real figure is closer to half of that. (Moaveni)
Why has the number of marriages dropped so drastically? According to Moaveni, economic conditions in Iran do not make marriage feasible. Inflation hit a whopping 25.9 percent in February 2009 (“Iran inflation hits 25.9%: Reports”). While that figure is lower than the September 2008 of 29 percent, it was still high enough to cause concern for Iran’s central bank chief Mahmoud Bahmani, who promised to slash inflation by almost 4 percent before the end of the Iranian year on March 20 (ibid). In early June 2009 there were some signs of improvement, with inflation falling to 23. 6 percent (“Iran inflation falls below 24 percent”). The number is still far too high, however, to accommodate a new couple desiring to start a family.
The inflation drop was also far too little, too late for Ahmedinejad’s political health. The Iranian president’s election rivals, such as reformist candidate Mehdi Karroubi, capitalized on the poor economic environment and blamed Ahmedinejad for encouraging inflation (ibid). Was Karroubi and the rest of the opposition way off the mark with their accusation? Again, Iran views itself as a revival of the Persian Empire, and Ahmedinejad certainly holds imperialist aspirations. In the quest for empire, Ahmedinejad has initiated several reckless expansionary economic policies. One of the results of this policy was Ahmedinejad’s proposed budget in January 2009 of 282.7 billion dollars with a deficit forecast of 44 billion dollars (“Iran inflation hits 25.9: Reports”). Can any country long stand such an orgiastic spending spree?
Probably one of the most serious problems currently facing Iran is low crude oil prices. Gholamhossein Nozari, Iran’s current Oil Minister, predicted oil prices “will hover at the $40 mark in 2009” (Avro). This prompted Nozari’s ministry to tell the government “to set the price of oil at that amount in its upcoming 2009-2010 budget” (ibid). According to Samuel R. Avro, these low prices “could eventually bring out the disgust of the Iranian public against the current regime which may then lead to destabilization and perhaps a halt to their nuclear program” (ibid). Bush’s CIA Director Michael Hayden also expressed this opinion, stating that Iran’s low oil prices “removes a buffer that will cause the natural stressors in Iranian society to become more pronounced” (ibid).
While the problems facing Iran are lamentable, they did set the stage for self-correction to occur in the Islamic Republic. The situation is beginning to right itself as more and more Iranians conclude that the country’s leadership lacks the ability and the desire to solve the problems. People began expressing their dissatisfaction with the current regime shortly after Iran’s tenth presidential election on June 12, 2009. The next day, opponents of Ahmedinejad took to the streets and began protesting, some violently (Johnson and Murphy). As we shall see, some of these protestors may have been part of an organized destabilization campaign. That being said, the number of people in the streets was far too high for everyone to be surrogates of Western intelligence agencies, a contention some of the more extreme conspiracists seem to be pushing. The crowds included many sincere Iranian citizens with legitimate grievances.
It’s important to note that many of the activists made the mistake of elevating Ahmedinejad’s main rival, Mir Hossein Mousavi, into a hero from which they derive inspiration. Behind Mousavi’s emergent messianic mystique hides a terrorist and criminal who is no better than Ahmedinejad. During his time as Iran’s prime minister in the 1980s, Mousavi was the supervisor of a terrorist campaign against the West that included the infamous attacks on the U.S. embassy and Marine Corps barracks in Beirut (Stein). According to former CIA case officer Robert Baer, Mousavi “oversaw an office that ran operatives abroad, from Lebanon to Kuwait to Iraq” (ibid). Baer places Mousavi in direct contact with Imad Mughniyah, the individual responsible for conducting the Beirut attack (ibid). Retired Navy Admiral and “father” of the Navy SEAL’s Red Cell counter-terror unit James “Ace” Lyons has also identified Mousavi as the mastermind behind the 1988 truck bomb attack on the U.S. Navy’s Fleet Center in Naples, Italy (ibid). That terrorist action resulted in the deaths of five people (ibid).
Given his criminal and terrorist background, it’s obvious that Mousavi represents the status quo in Iran, not change. Still it is important to note that Mousavi was able to build an impressive support base by presenting himself as a reformer and running on a reformist platform. These seems to indicate that many Iranians desire positive change and are now willing to express that desire.
A counter-revolution that will reverse the effects of the 1979 Iranian Revolution seems to be in the embryonic stage right now. Only one thing could reverse that trend: interference and intrusion on the part of the American Empire. If an American destabilization campaign were to be detected or exposed, internal contention would disappear and the people would again be galvanized behind Ahmadinejad. This potentiality is very real. Unfortunately, the American Empire’s interventionist spirit is alive and well and evidence suggests that it may be at work in Iran.
In May 2007, intelligence sources revealed to the UK Telegraph that President George W. Bush had given the CIA “approval to launch covert ‘black’ operations to achieve regime change in Iran” (Shipman). This approval, according to the Telegraph, appeared in a “non-lethal presidential finding” and authorized “CIA plans for a propaganda and disinformation campaign intended to destabilize, and eventually topple, the theocratic rule of the mullahs” (ibid). The presidential directive also endorsed the supply of communications equipment to opposition groups in Iran (ibid). This equipment would allow such groups to network with one another and coordinate destabilization plans more effectively (ibid).
The Telegraph’s revelations carried both negative and positive implications. On the positive, the directive prohibited the CIA from using lethal force (ibid). This can be interpreted to mean that Bush was moving away from the influence of Vice President Richard Cheney and his neoconservative allies who favor a military strike (ibid). However, the revelations had also shown that the President had not abandoned interventionist policies that could instigate hostilities with Iran.
When power traded hands from Bush to Obama, the approach to dealing with Iran seemed to change. Obama’s handlers among the power elite seemed to prefer attempting to recruit Iran to fight the American Empire’s other enemies. Imperial recruitment, euphemistically referred to as “diplomacy,” was heavily promoted in the early days of the Obama Administration. There is evidence, however, that destabilization efforts have continued. Perhaps the current administration believes that destabilization efforts will lead to a weakened Iran that is more willing to deal. Perhaps the administration has just grown frustrated with trying to reach out to a stubborn and skeptical nation. Whatever the case may be, aspects of the 2009 Iranian election fallout suggests the invisible hand of the American Empire at play.
On Saturday, June 20, 2009, Iran’s security apparatus reportedly discovered and arrested a large contingent of rioters in Tehran who were members of the Mujahideen-e-Khalq organization, or MEK (“Iran finds US-backed MKO fingermarks in riots”). Iranian security officials claimed that the MEK members “confessed that they were extensively trained in Iraq’s camp Ashraf to create post-election mayhem in the country” (ibid). The MEK members were also allegedly receiving instruction from the dissident group’s command post in Britain (ibid).
On the same day that the MEK rioters were arrested, the group’s leader Maryam Rajavis gave her official endorsement to election protestors and even went so far as to declare the MEK the real election victors (ibid).
Was the MEK acting as a surrogate of the American Empire? In July of 2008, respected journalist Seymour Hersh was told by a Pentagon consultant that the MEK might receive covert funds from the United States in order to help destabilize Iran (Hersh). The Iranian dissident group has received arms and intelligence from Western intelligence groups in recent years and possesses an enduring relationship with the CIA and Special Operations communities in spite of its inclusion on the State Department’s terrorist list for more than a decade (ibid). If MEK participation in the riots and protests prove to be a genuine example of American interference, it could threaten the chance of a successful counter-revolution.
Left to its own devices, Iran’s ruling establishment will commit political suicide. The Iranian people have simply lost too much confidence in the president, the mullahs, and the government’s way of doing things for the last three decades. American interventionism can not contribute one iota to the current regime’s trip on history’s exit ramp. If anything, black ops, destabilization campaigns, and ridiculous cloak and dagger schemes and conspiracies to “liberate” Iran will give the current regime a new lease on life. The American Empire is providing Iran’s ruling establishment with an existential threat that justifies its political survival. Iranians are starting to wake up and see Ahmadinejad for the mentally unstable tyrant he is. American meddling in Iranian affairs, however, would lend itself to a public relations spin that would portray Ahmadinejad as a populist hero doing battle with the “Great Satan.” Interference would destroy the receptivity of the Iranian people to change and lead to more hostility.
Perhaps a perpetually hostile and dangerous Iran is exactly what many among the power elite crave. These oligarchical Hegelian activists need a world full of bogeymen, fanatics, and dictatorial strongmen to maintain history’s march toward a new world order. At least one member of the neoconservative faction of the elite, Daniel Pipes, has expressed such sentiments. During a June 3, 2009 meeting held by the neoconservative Heritage Foundation, Pipes stated that if he were to participate in Iran’s election, he would, “with due hesitance,” vote for Ahmadinejad because the current Iranian president is “an enemy who’s forthright and obvious, who wakes people up with his outlandish statements” (“New Thinking for Old Problems: The Challenges of Middle East Peacemaking in the Shadow of the Iranian Threat”).
The dialectical climate proposed by Pipes will not lead to what the neoconservative Francis Fukuyama called “The End of History,” but it may lead to what Jesus Christ called “the beginning of sorrows” (Matthew 24:8). While Iran is certainly not the juggernaut the neoconservatives have portrayed it as, the overstretched American Empire is in no condition to tackle a third war. The Lord has designed the universe to take out its own garbage. It does not require the American Empire acting as its waste management surrogate.
Is there any meaningful contribution America can make to Iran’s nascent counter-revolution? America can aid the Iranians by helping itself. It can dismantle its bloated and overstretched empire and return to its constitutional roots as a democratic republic. Such a move would send a clear message to Iran. In effect, America will be saying, “We tried empire and it bankrupted us economically and morally. It’s weakened our military and left us in a weakened state. For the sake of your own country, don’t explore this imperial road further.” There is a good chance Iran would follow America’s example. Then, and only then, will the saber-rattling finally be silenced.
Sources Cited
* Avro, Samuel. "CIA: Low Oil Prices Place Pressure on Iran, Venezuela." Consumer Energy Report 18 January 2009
* Hersh, Seymour. "Preparing the Battlefield." The New Yorker 7 July 2008
* "Interview: Robert Baer." Frontline 22 March 2002
* "Iran finds US-backed MKO fingermarks in riots" Press TV 21 June 2009
* "Iran inflation falls below 24 percent." Television Washington 7 June 2009
* "Iran inflation hits 25.9%: Reports." The ARY News 8 March 2009
* Johnson, Anna and Brian Murphy. "Election Battle Turns Into Street Fights in Iran." ABC News 13 June 2009
* Loftus, John. Telephone interview. 21 March 2009.
* Mehryar, Amir and Akbar Aghajanian. "Below Replacement Fertility in Iran: A District Level Analysis of 2006 Census." Princeton University 2009
* Moaveni, Azadeh. "Will Iran's 'Marriage Crisis' Bring Down Ahmadinejad?" Time 9 June 2009
* "Nasrallah most admired Arab leader." Press TV 17 April 2008
* "New Thinking for Old Problems: The Challenges of Middle East Peacemaking in the Shadow of the Iranian Threat." The Heritage Foundation 3 June 2009
* Shipman, Tim. "Bush sanctions 'black ops' against Iran." The London Telegraph 27 May 2007
* Stein, Jeff. "Mousavi, Celebrated in Iranian Protests, was the Butcher of Beirut." CQ Politics 22 June 2009
America's Praetorian Guard Is Slowly Crumbling
By Jack D. Douglas
July 03, 2009 "Lewrockwell" -- Professional armies have traditionally been far more disciplined, especially under the stress of longer-run warfare.
BUT that does not mean they have no turning points or breaking points. In Rome the professional, imperial guard, The Praetorian Guard, was highly disciplined and bore casualties well in the early years. But over the decades of imperial struggles and military in-breeding common to such armies largely cut off from the civil population, they became bored with routine, self-centered, arrogant, puffed up with their own importance, and started deposing and imposing emperors, forcing them to put more and more of the national wealth into the military and so on. The professional military became a tyrannical force no civilians could control, so it controlled them through their imposed emperors.
That was one of the crucial reasons the American Constitutionalists were so desperate to prevent the rise of a professional army in the U.S. The professional army and navy elites of West Point and Annapolis and their minor league schools for officers grew slowly with the growth of America's imperial wars, but America relied on conscripts for mass armies, thus maintaining the civilian dilution of the professionals, until Nixon et al. moved to the professional army in the midst of rebellion by the conscripts and the conscripts to be.
There are always turning points and breaking points in military forces under the stresses of protracted warfare. Pros are better at hiding that, until it becomes so pervasive and most men feel so desperate that they quickly turn against wars and their elite officers who have failed them. When that happens, they feel far fewer restraints about rebelling than conscripts, especially when so many of them are from other nations and can escape to those if the rebellion fails.
I suspect from all the bits and pieces we can see that the U.S. imperial, professional army has turned against the war in Iraq very strongly and that is a crucial reason why the U.S. has retreated from the cities to the lonely 340 bases outside of them where they cannot be attacked easily and the men will have more time to booze and snooze and dream of girls back home. These are lonely bases and depression sets in. They will insist quietly on leaving those bases soon. The situation in Afpak is getting worse and worse and will likely follow the same pattern. The depressed professionals will insist on getting out, quietly unless their more insistent demands are not met. The growing financial crisis will also force the U.S. to curtail these trillion dollar a year military losses.
The Romans finally built a defensive wall across Britain and drew a line along the German rivers and other natural defense positions and declared an end to the long advance into Europe. They went over to the defensive and slowly but relentlessly retreated back toward Rome itself, then fled pall mall as the ever stronger "barbarians" broke through their defenses and finally sacked Rome itself.
The professionalization of an army is a clear signal that the civilian population has turned away from the imperial wars and is no longer willing to suffer to advance the imperial cause. The U.S. did it as an act of desperation as the army fell apart in Vietnam and the conscripts-to-be rioted in the streets and universities and fled to other nations not at war.
Today only a tiny fraction of America's elite young people would be willing to go into the military to fight imperial wars around the world. Almost all of them who do insist on being highly rewarded officers who move up the line fast and retire in twenty years with mucho loot. The ranks are filled with people who have few prospects in civilian society. They look ferocious in their armor with vastly superior fire power, but they are crumbling from inside because, aside from the sociopathic killers who love the gore and narcissistic sense of glory and power it gives them, most of them have weaker and weaker motivation to really "serve." They want to be paid more and more for less and less, like America's professional doctors, politicians, teachers, police, firemen, bankers, and all the other bureaucratic slackers whose hearts are not in the bureaucratic life. The same people who risk death and total exhaustion on the weekend to do impossible things with joy and no pay become depressed androids when Monday morning comes around.
The American Empire is crumbling inside the professionalized, android armies living in lonely and hellish quagmires in the deserts of the world. The American professionals are also crumbling from the inside in America. The whole Imperial System is crumbling from the inside out, as everyone insists on doing less and less for the society – the SYSTEM – for more and more money and power. The Empire is crumbling away from the inside out. The whole society will do the same unless this deadening Bureaucratic System is scrapped and the androids are allowed to become human beings once again.
The American plutocrats and top bureaucrats built the Empire. The American people have always loathed empires and, once they become aware they are spear carriers for this ghastly Empire that is losing its soul in every way, they quit, first inside and then more and more in open flight or rebellion.
The Psych problems of the American professional armies in these imperial wars is horrific. They will not put up with much more of this terrible
July 03, 2009 "Lewrockwell" -- Professional armies have traditionally been far more disciplined, especially under the stress of longer-run warfare.
BUT that does not mean they have no turning points or breaking points. In Rome the professional, imperial guard, The Praetorian Guard, was highly disciplined and bore casualties well in the early years. But over the decades of imperial struggles and military in-breeding common to such armies largely cut off from the civil population, they became bored with routine, self-centered, arrogant, puffed up with their own importance, and started deposing and imposing emperors, forcing them to put more and more of the national wealth into the military and so on. The professional military became a tyrannical force no civilians could control, so it controlled them through their imposed emperors.
That was one of the crucial reasons the American Constitutionalists were so desperate to prevent the rise of a professional army in the U.S. The professional army and navy elites of West Point and Annapolis and their minor league schools for officers grew slowly with the growth of America's imperial wars, but America relied on conscripts for mass armies, thus maintaining the civilian dilution of the professionals, until Nixon et al. moved to the professional army in the midst of rebellion by the conscripts and the conscripts to be.
There are always turning points and breaking points in military forces under the stresses of protracted warfare. Pros are better at hiding that, until it becomes so pervasive and most men feel so desperate that they quickly turn against wars and their elite officers who have failed them. When that happens, they feel far fewer restraints about rebelling than conscripts, especially when so many of them are from other nations and can escape to those if the rebellion fails.
I suspect from all the bits and pieces we can see that the U.S. imperial, professional army has turned against the war in Iraq very strongly and that is a crucial reason why the U.S. has retreated from the cities to the lonely 340 bases outside of them where they cannot be attacked easily and the men will have more time to booze and snooze and dream of girls back home. These are lonely bases and depression sets in. They will insist quietly on leaving those bases soon. The situation in Afpak is getting worse and worse and will likely follow the same pattern. The depressed professionals will insist on getting out, quietly unless their more insistent demands are not met. The growing financial crisis will also force the U.S. to curtail these trillion dollar a year military losses.
The Romans finally built a defensive wall across Britain and drew a line along the German rivers and other natural defense positions and declared an end to the long advance into Europe. They went over to the defensive and slowly but relentlessly retreated back toward Rome itself, then fled pall mall as the ever stronger "barbarians" broke through their defenses and finally sacked Rome itself.
The professionalization of an army is a clear signal that the civilian population has turned away from the imperial wars and is no longer willing to suffer to advance the imperial cause. The U.S. did it as an act of desperation as the army fell apart in Vietnam and the conscripts-to-be rioted in the streets and universities and fled to other nations not at war.
Today only a tiny fraction of America's elite young people would be willing to go into the military to fight imperial wars around the world. Almost all of them who do insist on being highly rewarded officers who move up the line fast and retire in twenty years with mucho loot. The ranks are filled with people who have few prospects in civilian society. They look ferocious in their armor with vastly superior fire power, but they are crumbling from inside because, aside from the sociopathic killers who love the gore and narcissistic sense of glory and power it gives them, most of them have weaker and weaker motivation to really "serve." They want to be paid more and more for less and less, like America's professional doctors, politicians, teachers, police, firemen, bankers, and all the other bureaucratic slackers whose hearts are not in the bureaucratic life. The same people who risk death and total exhaustion on the weekend to do impossible things with joy and no pay become depressed androids when Monday morning comes around.
The American Empire is crumbling inside the professionalized, android armies living in lonely and hellish quagmires in the deserts of the world. The American professionals are also crumbling from the inside in America. The whole Imperial System is crumbling from the inside out, as everyone insists on doing less and less for the society – the SYSTEM – for more and more money and power. The Empire is crumbling away from the inside out. The whole society will do the same unless this deadening Bureaucratic System is scrapped and the androids are allowed to become human beings once again.
The American plutocrats and top bureaucrats built the Empire. The American people have always loathed empires and, once they become aware they are spear carriers for this ghastly Empire that is losing its soul in every way, they quit, first inside and then more and more in open flight or rebellion.
The Psych problems of the American professional armies in these imperial wars is horrific. They will not put up with much more of this terrible
Whose Country is it anyway? A political-economic oligarchy has taken over the United States of America
By Prof. John Kozy
Global Research, July 4, 2009
A political-economic oligarchy has taken over the United States of America. This oligarchy has institutionalized a body of law that protects businesses at the expense of not only the common people but the nation itself.
CNN interviewed a person recently who was seriously burned when his vehicle burst into flames because a plastic brake-fluid reservoir ruptured. Having sued Chrysler, he was now concerned that its bankruptcy filing would enable Chrysler to avoid paying any damages. A CNN legal expert called this highly likely, since the main goal of reorganization in bankruptcy is preserving the company's viability and that those creditors who could contribute most to attaining that goal would be compensated first while those involved in civil suits against the company would be placed lowest on the creditor list since compensating them would lessen the chances of the company's surviving. This rational clearly implies that the preservation of companies is more important than the preservation of people. Of course, similar cases have been reported before. The claims of workers for unpaid wages have often been dismissed as have their contracts for benefits.
But there is an essential difference between a business that lends money or delivers products or services to another company and the employees who work for it. Business is an activity that supposedly involves risk. Employment is not. Neither is unknowingly buying a defective product. Workers and consumers do not extend credit to the companies they work for or buy products from. They are not in any normal sense of the word “creditors.” Yet that distinction is erased in bankruptcy proceedings which preserve companies at the public's expense.
Of course, bankruptcy is not the only American practice that makes use of this principle. The current bailout policies of both the Federal Reserve and the Treasury make use of it. Again companies are being saved at the expense of the American people. America's civil courts are notorious for favoring corporate defendants when sued by injured plaintiffs. Corporate profiteering is not only tolerated, it is often encouraged. The sordid records of both Halliburton and KBR are proof enough. Neither has suffered any serious consequences for their abysmal activities in Iraq while supplying services to the troops deployed there. Even worse, these companies continue to get additional contracts from the Department of State. “A former Army chaplain who later worked for Halliburton's KBR unit ... told Congress ... ‘KBR came first, the soldiers came second.'" [http://www.halliburtonwatch.org/news/deyoung.html] Again, it's companies first, people last. But Major General Smedley Butler made this point in 1935. [See http://www.scuttlebuttsmallchow.com/racket.html] And everyone is familiar with the influence corporate America has over the Congress through campaign contributions and lobbying. For instance, “the U.S. Chamber of Commerce has earmarked $20 million over two years to kill [card check].” [http://www.latimes.com/news/nationworld/nation/la-na-card-check4-2009jun04,0,7195326.story?track=rss] Companies expect returns on their money, and preventing workers from unionizing offers huge returns. And on Thursday June 4, 2009 USA Today reported that, “Republicans strongly oppose a government run [healthcare] plan saying it would put private companies insuring millions of Americans out of business. ‘A government run plan would set artificially low prices that private insurers would have no way of competing with,' Senate Minority Leader Mitch McConnell, R-Ky, said ... .” (Kentucky ranks fifth highest in the number of people with incomes below poverty. Why is he worried about the survival of insurers?)
The profound question is how can any of it be justified?
President Calvin Coolidge did say that the business of America is business and the American political class seems to have adopted this view, but the Constitution cannot be used to justify it. The word “business” in the sense of “commercial firm” occurs nowhere in it. Nowhere does the Constitution direct the government to even promote commerce or even defend private property. The Constitution is clear. It was established to promote just six goals: (1) form a more perfect union, (2) establish justice, (3) insure domestic tranquility, (4) provide for the common defense, (5) promote the general welfare, and (6) secure the blessings of liberty to ourselves and our posterity. Of course, the Constitution does not prohibit the government from promoting commerce or defending private property, but what happens when doing so conflicts with one or more of its six purposes? Shouldn't any law that does that be unconstitutional? For instance, wouldn't it be difficult the claim that a bankruptcy procedure that protects business and subordinates or dismisses the claims of workers and injured plaintiffs establishes justice? How can spending trillions of dollars to save financial institutions and other businesses whose very own actions brought down the global economy be construed as establishing justice or even promoting the general welfare when people are losing their incomes, their pensions, their health care, and even their homes? These actions clearly conflict with the Constitution's stated goals. Shouldn't they have been declared unconstitutional? Although the Constitution does provide people with the right to petition the government for a redress of grievances, it does not clearly provide that right to organizations or corporations and it certainly does not provide to anyone the right to petition the government for special advantages. Yet that is what the Congress, even after its members swear to support and defend the Constitution of the United States, allows special interest groups to do. Where in the Constitution is there a justification for putting the people last?
How this situation could have arisen is a puzzle? Haven't our elected officials, our justices, our legal scholars, our professors of Constitutional Law, or even our political scientists read the Constitution? Have they merely misunderstood it? Or have they simply chosen to disregard the preamble as though it had no bearing on its subsequent articles? Why have no astute lawyers brought actions on behalf of the people? Why indeed?
The answer is that a political-economic oligarchy has taken over the nation. This oligarchy has institutionalized a body of law that protects businesses at the expense of not only the common people but the nation itself. Businessmen have no loyalties. The Bank of International Settlements insures it, since it is not accountable to any national government. (See my piece, A Banker' Economy, http://www.jkozy.com/A_Bankers__Economy.htm.) Thomas Jefferson knew it when he wrote, “Merchants have no country. The mere spot they stand on does not constitute so strong an attachment as that from which they draw their gain.” Mayer Amschel Rothschild knew it when he said, "Give me control of a nation's money and I care not who makes the laws." William Henry Vanderbilt knew it when he said, “The public be damned.” Businesses know it when they use every possible ruse to avoid paying taxes, they know it when they offshore jobs and production, they know it when the engage in war profiteering, and they know it when they take no sides in wars, caring not an iota who emerges victorious. IBM, GM, Ford, Alcoa, Du Pont, Standard Oil, Chase Bank, J.P. Morgan, National City Bank, Guaranty, Bankers Trust, and American Express all knew it when they did business as usual with Germany during World War II. Prescott Bush knew it when he aided and abetted the financial backers of Adolf Hitler.
Yet somehow or other the people in our government, including the judiciary, do not seem to know it, and they have allowed and even abetted businesses that have no allegiance to any country to subvert the Constitution. Unfortunately, the Constitution does not define such action as treason.
America's youthful students are regularly taught Lincoln's Gettysburg Address and are familiar with its peroration, “we here highly resolve that these dead shall not have died in vain—that this nation, under God, shall have a new birth of freedom—and that government: of the people, by the people, for the people, shall not perish from the earth.” If that nation ever existed, it no longer does. And when Benjamin Franklin was asked, “Well, Doctor, what have we got—a Republic or a Monarchy?” he answered, “A Republic, if you can keep it.” We haven't. What we have ended up with is merely an Unpublic, an economic oligarchy that cares naught for either the nation or the public.
To argue that the United States of America is a failed state is not difficult. A nation that has the highest documented prison population in the world can hardly be described as domestically tranquil. A nation whose top one percent of the people have 46 percent of the wealth cannot by any stretch of the imagination be said to be enjoying general welfare (“generally true” means true for the most part with a few exceptions). A nation that spends as much on defense as the rest of the world combined and cannot control its borders, could not avert the attack on the World Trade Center, and can not win its recent major wars can not be described as providing for its common defense. How perfect the union is or whether justice usually prevails are matters of debate, and what blessings of liberty Americans enjoy that peoples in other advanced countries are denied is never stated. A nation that cannot fulfill its Constitution's stated goals surely is a failed one. How else could failure be defined? By allowing people with no fastidious loyalty to the nation or its people to control it, by allowing them to disregard entirely the Constitution's preamble, the nation could not avoid this failure. The prevailing economic system requires it.
Woody Guthrie sang, “This Land Is My Land, This Land Is Your Land,” but it isn't. It was stolen a long time ago. Although it may have been “made for you and me,” people with absolutely no loyalty to this land now own it. It needs to be taken, not bought, back! America needs a new birth of freedom, it needs a government for the people, it needs a government that puts people first, but it won't get one unless Americans come to realize just how immoral and vicious our economic system is.
NOTE:
There exist many fine books and articles which document that elements of the oligarchical US and British elite aided and abetted both the fledgling Soviet Union and Hitler's Germany. Neither could have come to power without the financial support of these financial/political oligarchs. For further details see for example, Professor Antony Sutton's books including America's Secret Establishment: An Introduction to the Order of Skull and Bones, Wall Street and the Rise of Hitler, and Wall Street and the Bolshevik Revolution.
It is truly a tragedy that to this day most Americans remain completely ignorant of the way in which powerful US interests have consistently financed both "friends" and enemies of the United States by utilizing a perverse Hegelian dialectic. See my essay the New "Bread and Circus" Bipolar World previously posted HERE... and also in a revised form at Traditional Catholic Reflections and Reportsfor more background.
Dr. J. P. Hubert
Global Research, July 4, 2009
A political-economic oligarchy has taken over the United States of America. This oligarchy has institutionalized a body of law that protects businesses at the expense of not only the common people but the nation itself.
CNN interviewed a person recently who was seriously burned when his vehicle burst into flames because a plastic brake-fluid reservoir ruptured. Having sued Chrysler, he was now concerned that its bankruptcy filing would enable Chrysler to avoid paying any damages. A CNN legal expert called this highly likely, since the main goal of reorganization in bankruptcy is preserving the company's viability and that those creditors who could contribute most to attaining that goal would be compensated first while those involved in civil suits against the company would be placed lowest on the creditor list since compensating them would lessen the chances of the company's surviving. This rational clearly implies that the preservation of companies is more important than the preservation of people. Of course, similar cases have been reported before. The claims of workers for unpaid wages have often been dismissed as have their contracts for benefits.
But there is an essential difference between a business that lends money or delivers products or services to another company and the employees who work for it. Business is an activity that supposedly involves risk. Employment is not. Neither is unknowingly buying a defective product. Workers and consumers do not extend credit to the companies they work for or buy products from. They are not in any normal sense of the word “creditors.” Yet that distinction is erased in bankruptcy proceedings which preserve companies at the public's expense.
Of course, bankruptcy is not the only American practice that makes use of this principle. The current bailout policies of both the Federal Reserve and the Treasury make use of it. Again companies are being saved at the expense of the American people. America's civil courts are notorious for favoring corporate defendants when sued by injured plaintiffs. Corporate profiteering is not only tolerated, it is often encouraged. The sordid records of both Halliburton and KBR are proof enough. Neither has suffered any serious consequences for their abysmal activities in Iraq while supplying services to the troops deployed there. Even worse, these companies continue to get additional contracts from the Department of State. “A former Army chaplain who later worked for Halliburton's KBR unit ... told Congress ... ‘KBR came first, the soldiers came second.'" [http://www.halliburtonwatch.org/news/deyoung.html] Again, it's companies first, people last. But Major General Smedley Butler made this point in 1935. [See http://www.scuttlebuttsmallchow.com/racket.html] And everyone is familiar with the influence corporate America has over the Congress through campaign contributions and lobbying. For instance, “the U.S. Chamber of Commerce has earmarked $20 million over two years to kill [card check].” [http://www.latimes.com/news/nationworld/nation/la-na-card-check4-2009jun04,0,7195326.story?track=rss] Companies expect returns on their money, and preventing workers from unionizing offers huge returns. And on Thursday June 4, 2009 USA Today reported that, “Republicans strongly oppose a government run [healthcare] plan saying it would put private companies insuring millions of Americans out of business. ‘A government run plan would set artificially low prices that private insurers would have no way of competing with,' Senate Minority Leader Mitch McConnell, R-Ky, said ... .” (Kentucky ranks fifth highest in the number of people with incomes below poverty. Why is he worried about the survival of insurers?)
The profound question is how can any of it be justified?
President Calvin Coolidge did say that the business of America is business and the American political class seems to have adopted this view, but the Constitution cannot be used to justify it. The word “business” in the sense of “commercial firm” occurs nowhere in it. Nowhere does the Constitution direct the government to even promote commerce or even defend private property. The Constitution is clear. It was established to promote just six goals: (1) form a more perfect union, (2) establish justice, (3) insure domestic tranquility, (4) provide for the common defense, (5) promote the general welfare, and (6) secure the blessings of liberty to ourselves and our posterity. Of course, the Constitution does not prohibit the government from promoting commerce or defending private property, but what happens when doing so conflicts with one or more of its six purposes? Shouldn't any law that does that be unconstitutional? For instance, wouldn't it be difficult the claim that a bankruptcy procedure that protects business and subordinates or dismisses the claims of workers and injured plaintiffs establishes justice? How can spending trillions of dollars to save financial institutions and other businesses whose very own actions brought down the global economy be construed as establishing justice or even promoting the general welfare when people are losing their incomes, their pensions, their health care, and even their homes? These actions clearly conflict with the Constitution's stated goals. Shouldn't they have been declared unconstitutional? Although the Constitution does provide people with the right to petition the government for a redress of grievances, it does not clearly provide that right to organizations or corporations and it certainly does not provide to anyone the right to petition the government for special advantages. Yet that is what the Congress, even after its members swear to support and defend the Constitution of the United States, allows special interest groups to do. Where in the Constitution is there a justification for putting the people last?
How this situation could have arisen is a puzzle? Haven't our elected officials, our justices, our legal scholars, our professors of Constitutional Law, or even our political scientists read the Constitution? Have they merely misunderstood it? Or have they simply chosen to disregard the preamble as though it had no bearing on its subsequent articles? Why have no astute lawyers brought actions on behalf of the people? Why indeed?
The answer is that a political-economic oligarchy has taken over the nation. This oligarchy has institutionalized a body of law that protects businesses at the expense of not only the common people but the nation itself. Businessmen have no loyalties. The Bank of International Settlements insures it, since it is not accountable to any national government. (See my piece, A Banker' Economy, http://www.jkozy.com/A_Bankers__Economy.htm.) Thomas Jefferson knew it when he wrote, “Merchants have no country. The mere spot they stand on does not constitute so strong an attachment as that from which they draw their gain.” Mayer Amschel Rothschild knew it when he said, "Give me control of a nation's money and I care not who makes the laws." William Henry Vanderbilt knew it when he said, “The public be damned.” Businesses know it when they use every possible ruse to avoid paying taxes, they know it when they offshore jobs and production, they know it when the engage in war profiteering, and they know it when they take no sides in wars, caring not an iota who emerges victorious. IBM, GM, Ford, Alcoa, Du Pont, Standard Oil, Chase Bank, J.P. Morgan, National City Bank, Guaranty, Bankers Trust, and American Express all knew it when they did business as usual with Germany during World War II. Prescott Bush knew it when he aided and abetted the financial backers of Adolf Hitler.
Yet somehow or other the people in our government, including the judiciary, do not seem to know it, and they have allowed and even abetted businesses that have no allegiance to any country to subvert the Constitution. Unfortunately, the Constitution does not define such action as treason.
America's youthful students are regularly taught Lincoln's Gettysburg Address and are familiar with its peroration, “we here highly resolve that these dead shall not have died in vain—that this nation, under God, shall have a new birth of freedom—and that government: of the people, by the people, for the people, shall not perish from the earth.” If that nation ever existed, it no longer does. And when Benjamin Franklin was asked, “Well, Doctor, what have we got—a Republic or a Monarchy?” he answered, “A Republic, if you can keep it.” We haven't. What we have ended up with is merely an Unpublic, an economic oligarchy that cares naught for either the nation or the public.
To argue that the United States of America is a failed state is not difficult. A nation that has the highest documented prison population in the world can hardly be described as domestically tranquil. A nation whose top one percent of the people have 46 percent of the wealth cannot by any stretch of the imagination be said to be enjoying general welfare (“generally true” means true for the most part with a few exceptions). A nation that spends as much on defense as the rest of the world combined and cannot control its borders, could not avert the attack on the World Trade Center, and can not win its recent major wars can not be described as providing for its common defense. How perfect the union is or whether justice usually prevails are matters of debate, and what blessings of liberty Americans enjoy that peoples in other advanced countries are denied is never stated. A nation that cannot fulfill its Constitution's stated goals surely is a failed one. How else could failure be defined? By allowing people with no fastidious loyalty to the nation or its people to control it, by allowing them to disregard entirely the Constitution's preamble, the nation could not avoid this failure. The prevailing economic system requires it.
Woody Guthrie sang, “This Land Is My Land, This Land Is Your Land,” but it isn't. It was stolen a long time ago. Although it may have been “made for you and me,” people with absolutely no loyalty to this land now own it. It needs to be taken, not bought, back! America needs a new birth of freedom, it needs a government for the people, it needs a government that puts people first, but it won't get one unless Americans come to realize just how immoral and vicious our economic system is.
NOTE:
There exist many fine books and articles which document that elements of the oligarchical US and British elite aided and abetted both the fledgling Soviet Union and Hitler's Germany. Neither could have come to power without the financial support of these financial/political oligarchs. For further details see for example, Professor Antony Sutton's books including America's Secret Establishment: An Introduction to the Order of Skull and Bones, Wall Street and the Rise of Hitler, and Wall Street and the Bolshevik Revolution.
It is truly a tragedy that to this day most Americans remain completely ignorant of the way in which powerful US interests have consistently financed both "friends" and enemies of the United States by utilizing a perverse Hegelian dialectic. See my essay the New "Bread and Circus" Bipolar World previously posted HERE... and also in a revised form at Traditional Catholic Reflections and Reportsfor more background.
Dr. J. P. Hubert
Saturday, July 4, 2009
Banks Own The US Government
There are smart ways to raise money and regulate the market, but Wall Street is working to kill any meaningful financial reform
By Dean Baker
July 01, 2009 "The Guardian" -- Last month, when the US Congress failed to pass a bankruptcy reform measure that would have allowed home mortgages to be modified in bankruptcy, senator Dick Durbin succinctly commented: "The banks own the place." That seems pretty clear.
After all, it was the banks' greed that fed the housing bubble with loony loans that were guaranteed to go bad. Of course the finance guys also made a fortune guaranteeing the loans that were guaranteed to go bad (ie AIG), and when everything went bust, the taxpayers got handed the bill. The cost of the bailout will certainly be in the hundreds of billions, if not more than $1tn when it is all over.
More importantly, we are looking at the most severe economic downturn since the Great Depression. The cumulative lost output over the years 2008-2012 will almost certainly exceed $5tn. That comes to more than $60,000 for an average family of four. This is the price that we are paying for the bankers' greed, coupled with incredible incompetence and/or corruption from our regulators.
Under these circumstances, it would be reasonable to think that the bankers would be keeping a low profile for a while. That's not the way it works in Washington. The banks are aggressively pushing their case in Congress and Obama administration. Not only are we not going to see bankruptcy reform, but any financial reform package that gets through Congress will probably contain enough loopholes that it will be almost useless.
In this political environment, the poor might get empathy, but Wall Street gets money, and lots of it. Even when the issue is global warming Wall Street has its hand out. The fees on trading carbon permits could run into the hundreds of billions of dollars in coming decades. A simple carbon tax would have been far more efficient, but efficiency is not the most important value when it comes to making Wall Street richer.
This is why it was so encouraging to see congressman Peter DeFazio's proposal to tax trades in oil options and futures. DeFazio proposed a tax of 0.02% on trades in oil futures and options as a way to make up a shortfall in the federal government's highway trust fund. This tax could raise billions of dollars each year in revenue and make speculation in the oil market a more dangerous affair.
The logic is very simple. For someone using these markets to hedge, the tax will be inconsequential. For example, a farmer that hedges a $400,000 wheat crop will pay $80 when selling a future. Similarly, airlines that hedge by buying oil futures will barely notice the higher cost. In fact, because trading costs have fallen so much in recent decades, a tax at this level would just be raising costs back to their levels of two decades ago, a point at which there was already a very vibrant futures and options market.
However, even a modest tax will make life much more difficult for speculators. Many of them expect to make quick short-term gains, often buying and selling the same day. For these traders, an increase in transactions costs of 0.02% would be a burden.
Of course, a modest tax will not drive the speculators out of the market altogether, it is just likely to reduce the volume of speculation. For this reason, even a modest tax can still raise an enormous amount of money in a market where tens of trillions of dollars of derivatives changes hands each year.
This tax can best be thought of as a tax on gambling. Gambling is heavily taxed in every state that allows it. DeFazio's bill is effectively a tax on gambling in the oil markets. It will not stop it, but it would discourage it, and in the process raise a huge amount of money that could go to productive purposes.
The bill faces an enormous uphill struggle in Congress. As Durbin said, the banks own the place, and they are not going to just step aside and let Congress impose a tax on such a lucrative business. But, it is important that people know about the DeFazio bill. First, DeFazio deserves a place on the honour roll for standing up to Wall Street.
Also, it is important for the public to know that there is a relatively low-cost way to make up the shortfall in the highway trust fund. When Congress raises some other tax and/or cuts a useful programme, people should know that there was a better alternative. It just didn't happen because, as we know, the banks own the place.
By Dean Baker
July 01, 2009 "The Guardian" -- Last month, when the US Congress failed to pass a bankruptcy reform measure that would have allowed home mortgages to be modified in bankruptcy, senator Dick Durbin succinctly commented: "The banks own the place." That seems pretty clear.
After all, it was the banks' greed that fed the housing bubble with loony loans that were guaranteed to go bad. Of course the finance guys also made a fortune guaranteeing the loans that were guaranteed to go bad (ie AIG), and when everything went bust, the taxpayers got handed the bill. The cost of the bailout will certainly be in the hundreds of billions, if not more than $1tn when it is all over.
More importantly, we are looking at the most severe economic downturn since the Great Depression. The cumulative lost output over the years 2008-2012 will almost certainly exceed $5tn. That comes to more than $60,000 for an average family of four. This is the price that we are paying for the bankers' greed, coupled with incredible incompetence and/or corruption from our regulators.
Under these circumstances, it would be reasonable to think that the bankers would be keeping a low profile for a while. That's not the way it works in Washington. The banks are aggressively pushing their case in Congress and Obama administration. Not only are we not going to see bankruptcy reform, but any financial reform package that gets through Congress will probably contain enough loopholes that it will be almost useless.
In this political environment, the poor might get empathy, but Wall Street gets money, and lots of it. Even when the issue is global warming Wall Street has its hand out. The fees on trading carbon permits could run into the hundreds of billions of dollars in coming decades. A simple carbon tax would have been far more efficient, but efficiency is not the most important value when it comes to making Wall Street richer.
This is why it was so encouraging to see congressman Peter DeFazio's proposal to tax trades in oil options and futures. DeFazio proposed a tax of 0.02% on trades in oil futures and options as a way to make up a shortfall in the federal government's highway trust fund. This tax could raise billions of dollars each year in revenue and make speculation in the oil market a more dangerous affair.
The logic is very simple. For someone using these markets to hedge, the tax will be inconsequential. For example, a farmer that hedges a $400,000 wheat crop will pay $80 when selling a future. Similarly, airlines that hedge by buying oil futures will barely notice the higher cost. In fact, because trading costs have fallen so much in recent decades, a tax at this level would just be raising costs back to their levels of two decades ago, a point at which there was already a very vibrant futures and options market.
However, even a modest tax will make life much more difficult for speculators. Many of them expect to make quick short-term gains, often buying and selling the same day. For these traders, an increase in transactions costs of 0.02% would be a burden.
Of course, a modest tax will not drive the speculators out of the market altogether, it is just likely to reduce the volume of speculation. For this reason, even a modest tax can still raise an enormous amount of money in a market where tens of trillions of dollars of derivatives changes hands each year.
This tax can best be thought of as a tax on gambling. Gambling is heavily taxed in every state that allows it. DeFazio's bill is effectively a tax on gambling in the oil markets. It will not stop it, but it would discourage it, and in the process raise a huge amount of money that could go to productive purposes.
The bill faces an enormous uphill struggle in Congress. As Durbin said, the banks own the place, and they are not going to just step aside and let Congress impose a tax on such a lucrative business. But, it is important that people know about the DeFazio bill. First, DeFazio deserves a place on the honour roll for standing up to Wall Street.
Also, it is important for the public to know that there is a relatively low-cost way to make up the shortfall in the highway trust fund. When Congress raises some other tax and/or cuts a useful programme, people should know that there was a better alternative. It just didn't happen because, as we know, the banks own the place.
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