Oligarchs, Bankers, and Swindlers

Posted on September 6, 2016 by Reid Mukai

Washington’s “New Managers” in Latin America

By James Petras

Amid raging corruption, social pathologies and outright political thuggery, a new gang of vassal regimes has taken-over Latin America. The new rulers are strictly recruited as the protégé’s of US financial and banking institutions. Hence the financial press refers to them as the “new managers” – of Wall Street.

The US financial media has once again provided a political cover for the vilest crimes committed by the ‘new managers’ as they launch their offensive against labor and in favor of the foreign and domestic financiers.

To understand the dynamics of the empire’s new vassal managers we will proceed by identifying (1) the illicit power grab (2) the neo-liberal policies they have pursued (3) the impact of their program on the class structure (4) their economic performance and future socio-political perspectives.

Vassals as Managers of Empire

Latin America’s current vassalage elite is of longer and shorter duration.

The regimes of longer duration with a historical legacy of submission, corruption and criminality include Mexico and Colombia where oligarchs , government officials and death squads cohabitate in close association with the US military, business and banking elites.

Over the past decades 100,000 citizens were murdered in Mexico and over 4 million peasants were dispossessed in Colombia. In both regimes over ten million acres of farmland and mining terrain were transferred to US and EU multinationals.

Hundreds of billions of illicit narco earnings were laundered by the Colombian and Mexican oligarchy to their US accounts via private banks.

The current political managers, Peña in Mexico and Santos in Colombia are rapidly de-nationalizing strategic oil and energy sectors, while savaging dynamic social movements – hundreds of students and teachers in Mexico and thousands of peasants and human rights activists in Colombia have been murdered.

The new wave of imperial vassals has seized power throughout most of Latin America with the direct and indirect intervention of the US. In 2009, Honduras President Manuel Zelaya was ousted by a military coup backed by Secretary of State Hillary Clinton. Zelaya’s program of agrarian reform, regional integration (with Venezuela) and constitutional elections was abolished. Zelaya was replaced by a US vassal, Roberto Micheletti who proceeded to murder several hundred landless rural workers and indigenous activists.

Washington moved to organize a constitutional cover by promoting a highly malleable landowner, Porfirio Lobo Sosa to the presidency.

The State Department next ousted Paraguyan President Francisco Lugo who governed between 2008-2012. Lugo promoted a moderate agrarian reform and a centrist regional integration agenda.

With the backing of Secretary of State Clinton, the Paraguayan oligarchy in Congress seized power, fabricated an impeachment decree and ousted President Lugo. He was briefly replaced by Vice President Federico Franco (2012-2013).

In 2013, Washington backed the capital Asuncion’s, notorious crime boss for President, one Horacio Castes – convicted for currency fraud in 1989, drug running in 1990, and most recently (2010) money laundering.

The Honduras and Paraguayan coups established (in miniature) the precedent for a new wave of ‘big country’ political vassals. The State Department moved toward the acceleration of banking takeovers in Brazil, Argentina and Peru.

In rapid succession, between December 2015 and April 2016 vassal managers seized power in Argentina and Brazil. In Argentina millionaire Mauricio Macri ruled by decree, by-passing constitutional legality. Macri fired scores of thousands of public service workers, closed social agencies and appointed judges and prosecutors without Congressional vote. He arbitrarily arrested social movement leaders – violating democratic procedures.

Macri’s Economic and Finance Ministers gained millions of dollars by ‘buying into’ multinational oil companies just prior to handing over private options on public enterprises.

The all-encompassing swindles and fraud carried out by the ‘new managers’ were covered up by the US media,who praised Macri’s professional team.

Moreover, Macri’s economic performance was a disaster. Exorbitant user fees on utilities and transport for consumers and business enterprises, increased three to ten-fold, forcing bankruptcy rates to soar and households to suffer light and gas closures.

Wall Street vulture funds received seven billion dollar payment from Macri’s managers, for defaulted loans purchased for pennies over a dollar, twenty-fold greater then the original lenders.

Data based on standard economic indicators,highlights the worst economic performance in a decade and a half.

Price inflation exceeds 40%; public debt increased by twenty percent in six months. Living standards and employment sharply declined. Growth and investment data was negative. Mismanagement, official corruption, and arbitrary governance did not induce confidence among local small and medium size businesses.

The respectable media, led by the New York Times, the Financial Times, the Wall Street Journal, and the Washington Post falsified every aspect of Macri’s regime. Failed economic policies implemented by bankers turned cabinet ministers were dubbed long-term successes; crude ideologically driven policies promoting foreign investor profiteering were re-invented as business incentives.

Political thugs dismantled and replaced civil service agencies were labelled ‘a new management team’ by the vulgar propaganda scribes of the financial press.

In Brazil, a phony political power grab by Congressional opportunists ousted elected President Dilma Rousseff. She was replaced by a Washinton approved serial swindler and notorious bribe taker, Michel Temer.

The new economic managers were predictably controlled by Wall Street, World Bank and IMF bankers. They rushed measures to slash wages, pensions and other social expenditures, to lower business taxes and privatize the most lucrative public enterprises in transport, infrastructure, landholdings, oil and scores of other activities.

Even as the prostitute press lauded Brazil’s new managers’, prosecutors and judges arrested three newly appointed cabinet ministers for fraud and money laundering. ‘President’ Temer is next in line for prosecution for his role in the mega Petrobras oil contracts scandal for bribes and payola.

The economic agenda by the new managers are not designed to attract new productive investments. Most inflows are short-term speculative ventures. Markets, especially in commodities, show no upward growth, much to the chagrin of the free market technocrats. Industry and commerce are depressed as a result of the decline in consumer credit, employment, and public spending induced by ‘the managers’ austerity policies.

Even as the US and Europe embrace free market austerity, it evokes a continent wide revolt. Nevertheless, Latin America’s wave of vassal regimes remain deeply embedded in decimating the welfare state and pillaging public treasuries led by a narrow elite of bankers and serial swindlers.

Conclusion

As Washington and the prostitute press hail their ‘new managers’ in Latin America, the celebration is abruptly given way to mass rage over corruption and demands for a shift to the political left.

In Brazil, “President” Temer rushes to implement big business measures, as his time in office is limited to weeks not months. His time out of jail is nearing a deadline. His cabinet of ‘technocrats’ prepare their luggage to follow.

Maurico Macri may survive a wave of strikes and protests and finish the year in office. But the plunging economy and pillage of the treasury is leading business to bankruptcy, the middle class to empty bank accounts and the dispossessed to spontaneous mass upheavals.

Washington’s new managers in Latin America cannot cope with an unruly citizenry and a failing free market economy.

Coups have been tried and work for grabbing power but do not establish effective rulership. Political shift to the right are gyrating out of Washington’s orbit and find no new counter-balance in the break-up of the European Union.

Vassal capitalist takeovers in Latin America generated publicist anesthesia and Wall Street euphoria; only to be rudely shocked to reality by economic pathologies.

Washington and Wall Street and their Latin America managers sought a false reality of unrestrained profits and pillaged wealth. The reality principle now forces them to recognize that their failures are inducing rage today and uprisings tomorrow.

James Petras is author of The End of the Republic and the Delusion of Empire, Extractive Imperialism in the Americas: Capitalism’s New Frontier (with Henry Veltmeyer), and The Politics of Empire: The US, Israel and the Middle East. Read other articles by James, or visit James’s website.

The Real Reason Brazil’s Democratically Elected Dilma Rousseff Was Impeached

Posted on September 2, 2016 by Reid Mukai

By Graham Vanbergen

Source: TruePublica

The real reason for the democratically elected leader of the largest country in South America being ‘impeached’ was not alleged corruption by its socialist president Dilma Rousseff, but more about Brazil’s elite power class and their media oligarchs who have failed time and time again to be democratically elected.

This by David Miranda from Brazil, The Guardian – “Slowly, the outside world has begun to see past the pleasing, two-dimensional caricature manufactured by its domestic press, and to recognise who will be empowered once Rousseff is removed. It has now become clear that corruption is not the cause of the effort to oust Brazil’s twice-elected president; rather, corruption is merely the pretext.

The story of Brazil’s political crisis, and the rapidly changing global perception of it, begins with its national media. The country’s dominant broadcast and print outlets are owned by a tiny handful of Brazil’s richest families, and are steadfastly conservative. For decades, those media outlets have been used to agitate for the Brazilian rich, ensuring that severe wealth inequality (and the political inequality that results) remains firmly in place.

But what most outside Brazil did not see was that the country’s plutocratic media had spent months inciting protests (while pretending merely to “cover” them). The protesters were not remotely representative of Brazil’s population. They were, instead, disproportionately white and wealthy: the very same people who have opposed the PT and its anti-poverty programmes for two decades.”

A New York Times article last week reported that “60% of the 594 members of Brazil’s Congress” – the ones voting to impeach Rousseff – “face serious charges like bribery, electoral fraud, illegal deforestation, kidnapping and homicide”. By contrast, said the article, Rousseff “is something of a rarity among Brazil’s major political figures: she has not been accused of stealing for herself”.

And from TruePublica columnist Stephen Lendman“President Dilma Rousseff’s ouster was orchestrated in Washington, complicit with corrupted Brazilian fascists – usurping power by removing her. Her impeachment was certain once the nation’s corruption-ridden Senate suspended her in May on trumped up budget-manipulation charges.

On August 31, it became official. Tyranny replaced Brazilian democracy. Telesur reported 49 senators voting for Rousseff’s impeachment “are themselves targets of criminal inquiries.” She committed no crimes. Nothing justified her removal. Allegations against her were fabricated.

Wednesday’s vote combined tragedy and farce – annulling 54 million votes electing her, returning the country to fascist rule, a sad moment for millions of Brazilians deserving better.”

Back in May this year The Guardian also headlined with “Brazil minister ousted after secret tape reveals plot to topple President Rousseff” in which “The credibility of Brazil’s interim government was rocked on Monday when a senior minister was forced to step aside amid further revelations about the machiavellian plot to impeach president Dilma Rousseff.

Just 10 days after taking office, the planning minister, Romero Jucá, announced that he would “go on leave” following the release of a secretly taped telephone conversation in which he said Rousseff needed to be removed to quash a vast corruption investigation that implicated him and other members of the country’s political elite.”

A plot was hatched to put into power one Michel Temer. He has since been implicated by corruption allegations himself following the release of a plea-bargain testimony implicating him in an enormous scandal centered on the country’s state oil company that included funds being illegally diverted to his party.

Perhaps it should be of no surprise then that as The Wall Street Journal said “It was the first time Mr. Temer has been directly implicated in the blockbuster corruption investigation known as Operation Car Wash, which has ensnared dozens of high-profile business and political figures, including leading members of Mr. Temer’s Brazilian Democratic Movement Party, or PMDB.”

At the time of the WSJ report in June this year, Mr. Temer was leading a government with an 11.3% approval rating – woeful by any estimation. Even George W. Bush had an approval rating of 22% at the end of his disastrous tenure as President of the USA.

And ZeroHedge was clearly taking no prisoners with its headline Another US-Sponsored Coup? Brazil’s New President Was An Embassy Informant For US Intelligence – “the Temer presidency may be nothing more than the latest manifestation of the US state department’s implementation of yet another puppet government. We know this because earlier today, Wikileaks released evidence via a declassified cable that Brazil’s new interim president was an embassy informant for US intelligence and military.”

The ousting of Brazil’s democratically elected President is yet more evidence that money and power leads to corruption on a grand scale. A propaganda war was waged against the electorate by a tiny elite who own the media and are a part of what is now a plutocratic regime. Yet again, we see another ‘scalp’ for America’s neocon lust and blood campaign for global domination as the evidence suggests CIA involvement and government support.

Lament for Humanity: A 50 Year Reflection

Posted on September 1, 2016 by Reid Mukai

Beryl & James Burrowes 1942 & 2016

By Robert J. Burrowes

Source: RINF

Deeply affected by the death of my two uncles in World War II, on 1 July 1966, the 24th anniversary of the USS Sturgeon sinking of the Japanese prisoner-of-war ship Montevideo Maru which killed the man after whom I am named, I decided that I would devote my life to working out why human beings are violent and then developing a strategy to end it.

The good news about this commitment was that it was made when I was nearly 14 so, it seemed, anything was possible. Now I am not so sure.

Here is my report on 50 years of concerted effort to understand and end human violence.

In 1966 one of my immediate preoccupations was war. The US genocidal war on Vietnam was raging and, as a sycophantic ally of the United States, Australia had been drawn into it some years previously. Trying to understand what this war was really about was challenging, particularly given the limited (mainstream) sources of information available to me at the time.

But I was deeply troubled by another problem too. I had seen a photo of a starving African child in the newspaper when I was ten and I found this most disturbing. Why did adults let children starve? I wondered. And trying to make sense of this by reading newspaper reports or asking those around me was utterly unenlightening.

By the early 1970s the environmental crisis was starting to impact on my awareness too, including through environmental campaigns I heard about and the ‘limits to growth’ literature published by the Club of Rome, which I read at University.

So where are we today?

Well, the most casual perusal of the state of our world reveals the ongoing (and recently heightened) threat of nuclear war and obliteration (on top of the ongoing and rapidly spreading radioactive contamination generated by Fukushima and the use of Depleted Uranium weapons), ongoing phenomenal levels of military spending and the endless push from corporate and other elite interests for more wars. Hence, we are witness to and, through our taxes, active supporters of an endless sequence of wars, military invasions, occupations and coups, virtually all of them instigated by the US elite and its allies, as well as a sequence of ‘local’ wars, also instigated by western elites and supplied with weapons by western corporations.

The global economy teeters on the brink of collapse and, of course, from the viewpoint of those 100,000 people in Africa, Asia and Central/South America who starve to death each day or those one billion people who live in a state of semi-starvation and abject poverty in many parts of the world, it has already ‘collapsed’. This all happens at the instigation of insane elites who continue to accumulate and hoard their wealth, much of it in illegal offshore tax havens. Given the enormous psychological damage that individual members of the elite have suffered, millions or even billions can never be enough.

And the environmental crisis has only become vastly worse with the synergistic impact of our combined assaults on the environment causing human extinction-threatening strain on the biosphere. These devastating assaults include those inflicted by military violence (often leaving vast areas uninhabitable), the emission of vast quantities of carbon dioxide, methane and nitrous oxide into the atmosphere, rainforest destruction, industrial farming, mining, commercial fishing and spreading radioactive contamination.

We are also systematically destroying the limited supply of fresh water on the planet and inducing the collapse of hydrological systems. Human activity drives 200 species of life (birds, animals, fish, insects, reptiles, amphibians, plants) to extinction each day and 80% of the world’s forests and over 90% of the large fish in the ocean are already gone.

Despite this readily available information, governments continue to prioritize spending $US2,000,000,000 each day on military violence, the sole purpose of which is to terrorize and kill fellow human beings, now or in the future.

In addition, you might have noticed the ongoing attacks on everything from our civil liberties and right to privacy to our right to eat healthy food that has not been poisoned and/or genetically mutilated.

So why does all of this happen? Well, 50 years of research and decades of nonviolent activism have had some rewards and particularly the research that Anita McKone and I conducted during our 14 years in seclusion (1996-2010) which fully explained why human beings are violent. In essence, it is an outcome of the visible, ‘invisible’ and ‘utterly invisible’ violence inflicted by adults on children. See ‘Why Violence?’ and ‘Fearless Psychology and Fearful Psychology: Principles and Practice’.

Moreover, this research also gave us enormous insight into the insanity of the global elite and those who serve them in order to maintain this worldwide system of violence and exploitation that is killing us all while destroying the biosphere. Whether it be the politicians who implement elite policies, the academics who ‘justify’ or remain silent about this violence and exploitation, the business people who manage it, the judges, magistrates, lawyers and prosecutors who defend and ultimately enforce it, the teachers and media personnel who teach and promote (or distract us from) it, or the soldiers, private military contractors, police and prison officers who inflict its most direct violence, the global elite is served by a ready stream of witting or unwitting people, many of whom are paid by your taxes to do its bidding. See ‘The Global Elite is Insane’.

And just to ensure that you are endlessly frightened into accepting this worldwide system of violence and exploitation, and to support its further encroachment into your life, the global elite conducts an ongoing terrorist campaign against you. See ‘Terrorism: Ultimate Weapon of the Global Elite’ and ‘Why Elites Love Drones’.

But there is another huge problem too: Lack of solidarity.

Elites know that they can divide us and that enables them to conquer us. Despite our efforts to build solidarity over recent decades, elites keep finding new ways to emphasize our ‘differences’. We need to start thinking of our selves as ‘We are all each other’. Does it matter if the ‘big’ difference between us is our gender, our race, our class, our religion, our nationality or something else (or even all of these)?

While elites can easily manipulate us, especially via education systems and the corporate media, into projecting our fear and self-hatred onto others who are ‘different’ and then inflicting violence on, or even killing, each other because, in effect, ‘I am an adult and you are a child’, ‘I am a man and you are a woman’, ‘I am non-indigenous and you are indigenous’, ‘I am a Christian/Jew/Hindu/Buddhist and you are a Muslim’, ‘I am working class and you are middle class’, ‘I am white and you are not’, ‘I am straight and you are LGBTQIA’, ‘I am one nationality and you are another’, ‘I am a feminist and you are a socialist’, or even ‘I am human and you are a bird/animal/fish/insect/reptile/amphibian/plant’ then we haven’t even begun to realize that the real issue is that we are all living beings and this insane elite is willing to do anything they can to exploit and, if necessary, kill us all.

Isn’t it time we started to see what makes us the same – victims of violence and exploitation – rather than focusing on what, after all, are the rather less significant differences in our bodily characteristics, in our beliefs or even the causes of our exploitation (which is not meant to diminish the significance of the outcomes of direct and structural violence which undoubtedly have variable impact)? Fear divides us.

One interesting personal outcome of this lifetime of effort, apart from the many arrests, terms of imprisonment (including once in a psychiatric ward where I was forcibly injected with ‘antipsychotic’ drugs), bankruptcy and seizure of my passport that have been direct results of my nonviolent activism, is that Anita and I have been homeless since 1999: conscience has its costs. Moreover, a worldwide search has failed to identify more than a handful of individuals (but pre-eminently my parents, James and Beryl, both veterans of World War II and now 93) or an organization of any kind that is willing to fund our research or our work to end human violence. Of course, there is a psychological explanation for this as well. See ‘Why Don’t We Try to Understand and End Human Violence?’

So what of human prospects? Not good. With an insane elite controlling the US (and other) military/nuclear arsenals and the highly exploitative global economy (with the secret corporate governance deals, such as the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership, designed to further consolidate corporate control of our world), as well as the dominant discourse via the education systems and corporate media, very few people have the emotional and intellectual capacities to critique this world order and then strategically and nonviolently resist the rush to extinction in which we now find ourselves. In short, most human beings are utterly (unconsciously) terrified and remain politically inert despite time and opportunities slipping rapidly away.

And those who do courageously resist this violent world order face a phalanx of violent institutions, ranging from psychiatry – see ‘Defeating the Violence of Psychiatry’ – and the pharmaceutical – see ‘Bad Pharma: How Drug Companies Mislead Doctors and Harm Patients’ – and agribusiness – see ‘Monsanto, America’s Monster’ – industries to the corporate media – see ‘Propaganda & Engineering Consent for Empire’ – and the police, legal and prison systems – see ‘The Rule of Law: Unjust and Violent’ – designed to neutralize or stop us, one way or another.

So what do I suggest? Well, with the scientific evidence now indicating that near term human extinction is the most likely outcome – see ‘Why is Near Term Human Extinction Inevitable?’ – it is increasingly clear that if we are to end human violence in all of its many and complex manifestations, and prevent human extinction, then we need an integrated and comprehensive strategy for doing so that also provides many meaningful avenues for involvement by individuals and organizations who wish to respond powerfully: token gestures have no value. Over many years I have endeavoured to create this overarching strategy and I invite you to participate in it by doing one or more of the following.

If you are an adult, you might consider dramatically modifying your treatment of children in accordance with ‘My Promise to Children’. You might also find this article useful in better understanding how to do so: ‘Nisteling: The Art of Deep Listening’.

If these suggestions seem beyond you, then perhaps your own emotional healing should be your priority. Despite its title, this article explains what you need to do: ‘An Open Letter to Soldiers with “Mental Health” Issues’. And remember this: if you don’t believe that you are ‘important’ enough to spend time learning to know yourself more deeply, I disagree. You are important.

Separately from the above, you might like to join those participating in ‘The Flame Tree Project to Save Life on Earth’. You might also consider signing the online pledge of ‘The People’s Charter to Create a Nonviolent World’.

And if you would like to learn how to make your nonviolent action campaign for a peace, environmental or social justice outcome more strategically effective, you can do so here: ‘Nonviolent Campaign Strategy’. To nonviolently defend against coups and invasions, remove a dictatorship or conduct a liberation struggle, check out ‘Nonviolent Defense/Liberation Strategy’.

I am not going to get another 50 years to try to create the world of peace, justice and sustainability for which many of us strive but I am going to use every single moment of the time I have left.

Why? Because I love the Earth and everything on it. And you?

Robert J. Burrowes has a lifetime commitment to understanding and ending human violence. He has done extensive research since 1966 in an effort to understand why human beings are violent and has been a nonviolent activist since 1981. He is the author of ‘Why Violence?’ His email address is flametree@riseup.net and his website is here.

Stripping the veneer off America’s propaganda menagerie

Posted on August 31, 2016 by Reid Mukai

By Wayne Madsen

Source: Intrepid Report

National Security Agency whistleblower Edward Snowden and WikiLeaks founder Julian Assange have doubled down recently on the games being played in cyberspace by America’s cyberwarriors. Snowden suggests that many of NSA’s most damaging malware programs are now in the hands of America’s opponents, thanks to enterprising foreign counterintelligence hackers known as the Shadow Brokers. Snowden believes that the malware, including destructive programs such as Stuxnet, are being auctioned off, via Bitcoin payments, by the Shadow Brokers. Snowden stated that the malware was obtained through hacking from a murky NSA operation called the “Equation Group.”

Assange, fearful that a new Ecuadorian president will hand him over to a Clinton administration in 2017, claims to have more hacked bombshells to drop on Team Clinton, courtesy of weak security in Democratic National Committee and Clinton campaign computer systems.

We have entered a new phase of cyberwarfare, one in which America’s (and Israel’s) most damaging computer hacking and disruption programs are available to anyone willing to pay in Bitcoins on the cyberblack market. The Democratic Party’s leaked emails, coupled with the leaked State Department cables, has Hillary Clinton in an outrage. These disclosures, along with the Snowden disclosures that illustrate how America spies on friend and foe, have stripped the veneer off of America’s propaganda menagerie. Two of the three culprits Mrs. Clinton would like to see in prison for the rest of their lives are, for the time being, outside of Gulag America. Snowden is enjoying political asylum in Russia and Assange has asylum at the Ecuadorian embassy in London. The third, Chelsea Manning, is serving a 35-year prison term at Fort Leavenworth in Kansas and allegedly recently attempted suicide.

Paul Ceglia, who claims to have been the co-founder of Facebook, says he is on the run from the CIA after he filed suit against Facebook and its owner Mark Zuckerberg. Although Zuckerberg admits to having a past business relationship with Ceglia, the US Justice Department criminally charged Ceglia for trying to defraud Facebook after the former associate of Zuckerberg brought a civil suit in federal court in Buffalo against the company. Interestingly, Facebook has donated more money to Hillary Clinton than any other presidential candidate. But what is really at issue in the bizarre case is that Ceglia claims that Facebook’s seed money came from the CIA’s venture capital firm IN-Q-TEL, a charge to which WMR can attest after compiling a massive list of CIA front companies and proprietaries in the soon-to-be-published book: “The Almost Classified Guide to CIA Front Companies, Proprietaries and Contractors.”

The CIA and its partners at Facebook, Google, Yahoo, Microsoft, and other social media firms have striven to control the new media in the same manner that the CIA controlled the “old media” through operations like MOCKINGBIRD. During the Cold War era, the CIA claimed that all the world’s ills were due to Communist front organizations that influenced the media. The truth is that the so-called “fronts” often provided actual accounts of the misdeeds of the CIA and other Western intelligence agencies. However, with U.S. newspapers, magazines, and broadcast networks carrying the water for the CIA, it was Langley’s interpretation of the news that made Western headlines. The “Communist” reports were relegated to the nether regions of “Soviet disinformation” campaigns and “active measures.” The CIA laughably put out a periodical report on such “disinformation” tactics. In reality, what was called “disinformation” was actually bona fide news.

Today, when the CIA wants to debase a news article, it uses such operations as Snopes.com and Wikipedia to engage in CIA disinformation tactics. Uncomfortable truthful news items are quickly dispatched with the term “conspiracy theory.” There is little doubt that Facebook, Wikipedia, and Snopes are part of a “new MOCKINGBIRD” designed for the digital age. Like them or not, Snowden, Assange, Manning, Ceglia, and others have pulled the veil off of the new MOCKINGBIRD.

A formerly secret February 1987 CIA report on Soviet disinformation tactics illustrates that what was described then as “propaganda” was, in fact, the truth.

The CIA called baseless charges in a Soviet book that Jonestown, Guyana was a CIA behavioral control operation. It was.

The Soviets accused Ronald Reagan’s Strategic Defense Initiative (SDI) of having the goal of weaponizing outer space. Not only was that the goal then, but it remains the goal of present incarnations of SDI.

The Soviets and the Afghan president, Najibullah of the Afghan Communist Party, said that they reached out to 50,000 Afghan mujaheddin in Afghanistan and Pakistan, who agreed to lay down their arms and join a coalition government, with eight opposition parties joining the Communists. The CIA and Western media called the news bogus. It was true with television footage of Afghan refugees returning to their homeland from India. The Soviets wanted an internationally-guaranteed neutral Afghanistan before withdrawing their troops. The CIA wanted a radical Islamic Afghanistan from which to launch attacks on the southern Soviet Union. That decision came back to bite the United States on September 11, 2001.

The CIA accused the Sandinista government of Nicaragua and the Soviets of being behind the Christian “Evangelical Committee for Development Aid” as a Communist front group. If so, it would have been the first time Communists and Christian evangelicals broke bread together. The CIA’s charge was fatuously false.

The Soviets accused the U.S. of using Africans as test subjects for a new AIDS vaccine. This charge has been proven with Africans being used as “guinea pigs” for various new vaccines in programs funded by the Bill and Melinda Gates Foundation, the Clinton Global Initiative, Pfizer Corporation, and other entities linked to CIA biological and genetic warfare operations.

Articles in two Bolivian newspapers that stated that the U.S. Information Service in La Paz was trying to recruit Bolivian journalists to write pro-Pentagon articles were deemed by the CIA to be bogus. The CIA charge was false and it included smearing the Federation of Bolivian Press Workers as a Communist front. That is the usual practice by the CIA when it’s caught red-handed.

The Soviet news agency Novosti was accused of running a false article, titled “The Relationship Between Journalists and the CIA: Hundreds of Them in International Press.” The article was spot on.

The CIA charged as Soviet disinformation charges that the CIA killed nine nonaligned leaders, including Indian Prime Ministers Indira and Rajiv Gandhi. In fact, the CIA has killed many more than nine nonaligned leaders.

In the digital world of YouTube, Facebook, Google, and other social and news media sites, the CIA continues its game of disinformation while accusing others of conducting the same game plan. Some three decades after the Cold War, the CIA’s charges of Soviet disinformation can now be seen as disinformation in their own right.

Wayne Madsen is a Washington, DC-based investigative journalist and nationally-distributed columnist. He is the editor and publisher of the Wayne Madsen Report (subscription required).

Why Americans Must Demolish the Political Duopoly and Create a New Progressive Alliance

Posted on August 24, 2016 by Reid Mukai

By Thomas Baldwin

Source: Dandelion Salad

A Call to Action!

“Insanity is doing the same thing over and over again and expecting different results.”– Albert Einstein

Duopoly: “preponderant influence or control by two political powers.”

Demolish: “to destroy by breaking apart; to put an end to.”

Corporate fascism (or Corporatism): “the complete merger of corporate and state entities to create a political entity.”

The United States is experiencing a serious crisis and most Americans know it. Our government and the Washington establishment is disintegrating at near breath taking speed. It could well be the most serious situation in at least a hundred years. For years now several authors have described our government in Washington as being “broken” or “dysfunctional”. But these words seem inadequate any longer.

It is much more like a “living” entity which is dying and is in a critical state; all vital signs are poor. Crises are generated in Washington from incompetence and corruption. Little or nothing gets done; few if any serious problems are addressed. Everything is addressed as “partisan.” But that is a delusion because as I will mention later there is really only one party with two different factions serving the corporate fascists. When the two factions finally agree on something, then it is called “bipartisan” because the two political parties appear to be constantly fighting over power and money. What, if anything, is to be done about this evil charade?

Read the full article at Dandelion Salad.

Why Ajamu Baraka? Why Vice President? And Why the Green Party?

Posted on August 22, 2016 by Reid Mukai

What does the Green Party nomination of longtime Black Agenda Report contributing editor Ajamu Baraka for Vice President mean for the Green Party and the 2016 presidential election? Is he just a black face on the ticket, or is it really time to begin organizing in black and brown communities outside the matrix of the bankrupt black and brown misleadership class?

By Bruce A. Dixon

Source: Black Agenda Report

In Houston on the first Saturday of August, the Green Party nominated Jill Stein, a Massachusetts physician, and Ajamu Baraka, a longtime human rights activists as its presidential and vice presidential candidates for 2016. Stein’s nomination was a foregone conclusion, having been the Green candidate in 2012 and the only one of several aspirants to raise money, hire staff and campaign across the country full time for more than a year.

Ajamu Baraka followed a different road to the nomination, having been an interested observer but with no organizational connection to the Green Party till now. Ajamu Baraka was the founding executive director of the US Human Rights Network, which still seeks to have the framework of internationally recognized human rights law applied to the victims of social and economic injustice in the US. This is a truly radical concept because the supreme law in the US is the Constitution, which chiefly guarantees property rights and the rights of corporations but not necessarily the rights of human beings to a quality education, the vote, decent housing, health care, renumerative jobs and the right to organize, or to a safe and clean environment, none of which are mentioned.
Ajamu Baraka was among the first to demand, in the wake of the Katrina disaster, that the 300,000 or so persons uprooted, the majority of them African American, be classified as “internally displaced” under international law, a status which would have guaranteed them the right to return to the cities and towns from which they were displaced and dispersed to the four corners of the US. Since the 1980s Baraka has been a consistent and principled critic of imperial US foreign policy over the years in Africa, Asia, Central and South America and the Middle East. He’s served in and led fact-finding delegations to Central America, Cuba, Israel-Palestine, Colombia and other places. In the wake of the 2010 hunger strike waged by Georgia prisoners, Baraka led an unprecedented civilian inspection team into two state prisons where they were able to interview staff and prisoners alike.

I should say here that I count both Jill and Ajamu as comrades and personal friends, that I was on Jill’s campaign staff for several months and that Ajamu Baraka has more than 50 articles published at Black Agenda Report.
So why Ajamu Baraka?

It’s not a simple matter of putting a black face on the ticket. Greens have run black candidates in local and national races before without managing to make a significant dent in traditional black allegiances to the Democratic party.

Stein chose Baraka because one of her campaign’s objectives is to strengthen state and local Green parties. As a result of his more than four decades of work in the movement, Baraka has longstanding personal ties with and has been mentor to many of the activists involved in the Black Lives Matter movement around the country. If anyone can carry the message to these forces that now is the time for organizing alternative centers of struggle for political power, centers of struggle outside the two capitalist parties and outside the nonprofit industrial complex, that someone is Ajamu Baraka.

African American voters have long been the rock upon which the Democratic party’s voting coalition rests. But since blacks vote Democratic mainly out of fear of the Republicans, they are a captive constituency whose votes are counted but whose demands are ignored. Jill and the Greens know it will take more than running good black or brown candidates to make its black, Latin and working class captive constituencies climb out of the Democrats’ trunk. Realistically that won’t much happen this election. The candidacies of Greens like Joshua Harris in Baltimore and Ashley Flash Gordon in Travis County TX are signs that something new and unprecedented is peeking over the horizon, something that will challenge the vacuity and lack of vision of the black political class. It’s not a challenge mature enough to accomplish a string of local electoral victories across the country. But it’s real, it’s gaining ground, building experience and it’s not going away.

The present black political class and the leadership model that supports it have been in place pretty much since the days of Booker T. Washington twelve decades ago. They won’t be displaced this election cycle, but their political bankruptcy is every bit as real and obvious as that of their white counterparts.

Why Vice President?

A frequently asked question is why Greens run candidates for president every year, but haven’t elected or even run candidates in many states for state reps and state senators, for county commissioners and members of congress. The answer is really simple.

The two capitalist parties protect themselves against competitors with a briar patch, a minefield of provisions and conditions expressly designed to make it all but impossible for parties not financed by the one percent to appear on the ballot. In many states, candidates who are not Democrats or Republicans are prohibited from appearing on the ballot until after their parties have scored one percent, two percent or five percent, depending on the state, in a statewide election.

This legal requirement in states like Georgia that Greens must score tens or hundreds of thousands of votes in statewide races before being allowed to run in local races is one more of the deliberate obstacles Democrats and Republicans have erected to competition from third parties at the ballot box. And it’s why Ajamu Baraka is running for vice president and Jill Stein for president much of the country were Greens are not allowed to run for local office.

Why the Green Party?

For the last fifty years, Republicans have deliberately made themselves the party of white racists and nativists. There’s simply in the Republican party or African Americans except a shorter line. Democrats talk a different game, but are responsible to the same one percenters who fund Republicans, so once in office, Democrats govern pretty much like Republicans. In fact Democratic presidents and governors frequently enact the oppressive policies we won’t allow Republicans to enact.

NAFTA came up twice during the first Bush presidency and failed. It took a Democrat, a President Clinton to rally enough right wing Democrats to ally with Republicans to get it into law. Ending public aid was also something no Republican could do, but Democrats only need the support of the black and poor when they’re candidates, not so much when they’re governing. The 2008 Bush bailout went before a Democratic Congress and it failed. Barack Obama had to suspend his campaign for a week and come to DC and work the phones to flip the Congressional Black Caucus and enough other Democrats to pass the Bush bailout, which he quadrupled down on once in the White House. Again it was a blow no Republican could have struck, though many wanted to.

Barack Obama used stimulus money to fund what he called “Race To The Top”, a drive to privatize public education that resulted in the closing and privatization of thousands of public schools, and pushed hundreds of thousands of qualified experienced public school educators out of the classroom. This too was something no Republican could have accomplished, much as they wanted to. There are many, many similar examples of Democrats accomplishing the right wing goals Republicans can only talk about on the state and local levels.
Republicans like Donald Trump talk about how they’d like to do mass deportations. But our First Black President has deported two million people, more than any other three presidents combined, after promising Latino voters “a road to citizenship” in both his campaigns.

The only reason to vote for Democrats is our fear of Republicans, and as Jill Stein says, this politics of fear has delivered to us everything we were afraid of. People voted Democratic to end the war in Iraq but we got more war in the Middle East and Africa. People voted Democrat to raise the minimum wage and see millions of new jobs created. But the minimum wage has barely risen and the only reason official unemployment figures are down is that his policies have pushed millions of people out of the formal workforce into increasingly precarious economic situations.

At the end of the reign of our first black president, a Democrat when blacks have been the rock and mainstay of Democratic voting coalitions for two generations, forty percent of black children are growing up in poverty. Isn’t it time for some new questions?

Why must “progressives” ride to Hillary’s rescue if we don’t get progress?

Trump is a bumbling clown and a bogeyman. He’s raising a fraction of the money Romney raised, four years ago. Hillary Clinton has a billion dollars to campaign with and most of the corporate media. If she can’t beat this fool with all the resources available to her, why is it up to us? Why? Hillary ought to be, and ought to have been helping us, not the other way around.

I don’t expect the Greens to win the presidential election. But the US system is almost 250 years old, one of the most elderly on the planet. Its creaks and cracks are highly visible and aren’t going away. Isn’t it time to start imagining and building what comes next, what comes after capitalism, what comes after genocide and ecocide, what comes after patriarchy and white supremacy?

Isn’t it time to start being the change we want to see?

That won’t happen inside the Democratic party. It’s been tried again and again. It’s time to build something different. So why not the Green Party?
Bruce A. Dixon is managing editor at Black Agenda Report and a member of the state committee of the Georgia Green Party. He lives and works near Marietta GA and can be reached via email at bruce.dixon(at)blackagendareport.com.

Finally: the Eruption of the Clinton Foundation Scandal

Posted on August 19, 2016 by Reid Mukai

By Gary Leupp

Source: CounterPunch

“It’s getting really hard to know where any lines were drawn.”

-CNN

I confess I’d been looking forward to this. My son, following the Judicial Watch website, has been saying for months that the big email scandal will involve the State Department-Clinton Foundation ties and Hillary’s use of her office to acquire contributions from Saudi and other donors. As someone opposed to World War III (beginning in Syria and/or Ukraine), I was hoping that they (and he) were right.

It might not be all that immediately clear to many why this is another big deal. After all, it follows Hillary’s ongoing private server email scandal, involving not just issues of the Secretary’s “judgment” and so-called “national security” but also revealing details about Clinton’s key role in the bloody destruction of Libya and her hawkish views in all circumstances.

CNN commentators assure us that the FBI investigation “went nowhere” because the FBI decided she’d committed no crime. (Just move on, folks; this was political all along.)

These new revelations come just after the scandal of the DNC rigging the primaries for Hillary, revealed by email leaks (from an unknown source) provided through Wikileaks. The content of these has been avoided like the plague by mainstream media, which is in Hillary’s camp and is generally protecting her. The focus instead is on alleged Russian efforts to influence the U.S. election, and the imagined Putin-Trump “bromance.” Respectable news agencies have been announcing, as fact, the idea that Wikileaks got the emails from Russia; and that Moscow is trying to swing the election towards Trump (because he’ll accept an invasion of Estonia, wreck NATO etc.). It’s (or it should be) obvious bullshit, an effort to change the subject while exploiting the McCarthyite paranoid sentiments of the most backward.

The headlines are so far cautious. “Emails renew questions about Clinton Foundation and State Department Overlap.” “Newly released Clinton emails shed light on relationship between State Dept. and Clinton Foundation.” They are not (yet) shrieking, “Sheik bought State Dept. favors from Clinton Foundation donation” but we shall see.

What do the emails show so far? Two examples have been highlighted by the conservative Judicial Watch, which requested the email transcripts through the FOIA. In the first, in 2009, Gilbert Chagoury, a Lebanese-born billionaire who has given the foundation up to five million dollars and used its assistance to build a project in Nigeria, and is one of the foundation’s top donors, contacted Doug Band, head of the foundation’s Clinton Global Initiative, asking to be put in touch with a high ranking State Department official connected to Lebanon.

Band emailed Hillary’s top aide Huma Abedin and advisor Cheryl Mills, expressing a need. He writes: “We need Gilbert Chagoury to speak to the substance person re Lebanon. As you know, he’s a key guy there and to us and is loved in Lebanon. Very imp.”

A key guy to us. To the Clinton Foundation? The U.S.A.? Abedin did not ask that question before responding, “It’s jeff feltman. I’m sure he knows him. I’ll talk to jeff.” Feltman had been U.S. ambassador to Lebanon from July 2004 to January 2008 but was apparently still seen as the go-to guy. So Hillary’s chief aide took it upon herself to contact the former ambassador to tell him Chagoury (whom she might mention is a major contributor to the Clintons) needed to talk with him.

Nothing illegal there, they will say. Why shouldn’t the State Department arrange contact between a billionaire Lebanese Clinton donor, loved in Lebanon, and the ex-ambassador, if it contributes to regional stability or U.S. national security? And the hard-core Hillary supporters will nod their heads, and maybe point out that Feltman has denied any “meeting.” (Maybe Huma just passed on his address and they chatted online.)

(CNN I notice is showing a video of Bill Clinton with Chagoury in Nigeria, inaugurating a multi-billion dollar waterfront development on the coastline established “under the umbrella of the Clinton Global Initiative.”)

The other instance of “overlap” central to the discussion so far is a request of Band to Abedin and Mills for “a favor.” Someone who had recently been on a Clinton Foundation trip to Haiti wanted a State Department job. He indicated that it was “important to take care of” this person. Abedin, apparently without questioning Band about why this person was important, got right back to him: “We all have him on our radar. Personnel has been sending him options.” So the head of the Clinton Foundation could snap his fingers, again stressing how “important” his demand was, and Hillary aides Huma and Cheryl paid by your tax dollars would snap into action.

A CNN report deplores “the intermingling of emails between State and Clinton Foundation and others, giving the overall effect that it’s getting really hard to know where any lines were drawn.”

Maybe nothing illegal here. But there is an ongoing FBI investigation, no longer about Hillary’s multiple phones and private server, nor about the content of the communications (revealing her hawkish savagery), but about the routine trade-off of foundation connections for political rewards.

Those transactions are mere corruption, not war crimes. But the U.S. mass media never targets politicians for their bloodiness, and they love the conventional corruption scandal. So let there be more leaks that will absorb the attention of the talking heads! Let’s see clearer pay-for-play evidence! And let’s see more details about how the DNC midwifed Hillary’s nomination, actively sabotaging a supposedly democratic process.

Let the American people see how thoroughly rotten both candidates are, and how thoroughly rotten the system that barfed them up.

Bernie in a fair process would be the Democratic nominee now. Clinton didn’t so much steal the election as buy it in advance, arranging the details through lackey Debbie Wasserman Schultz. Trump would not be the Republican nominee but for the editorial decisions of cable news producers to—from the very inception of his campaign—announce BREAKING NEWS and cover his nearly identical rants every time he held a rally.

This gratuitous coverage obviated the need for any (other) Trump advertising. Even as the anchors, commentators and other talking heads ridiculed, denounced and appeared puzzled about the Trump phenomenon, the networks made the viewers imbibe his vapid rants. They hooked the most reactionary elements of the population on this blowhard billionaire nut case.

In the Democrats’ case, Wall Street and Wasserman Schultz controlled the primaries. In the Republican case, the corporate news media (for its immediate profit motives) advertised a total dick who happened to be a billionaire and represent the One Percent every bit as much as Hillary.

So they’re now in our faces, day after day. Hideous people with their news-anchor supporters, and cable commentators so ready to dismiss serious issues, put the very best face on their candidate, and change the subject to attack the other candidate. In the end it comes down to: We have a two-party system. The parties made their choices. So you HAVE to choose one.

Julian Assange described the U.S. presidential race as a choice between cholera and gonorrhea. Why should the people of this great country of 310,000,000 people—many with great creativity, integrity and intelligence—be assigned this sick choice of Clinton or Trump by the One Percent that controls everything?

Why should any Bernie supporter so debase himself or herself as to say, “Okay, I know the primaries were fixed and that Bernie could not win because the cards were stacked against him. And despite the fact that I put passion and effort into an anti-Wall Street campaign, now I’ll support the Wall Street candidate, who’s also a liar, who’s going to flip-flop again on TPP and bomb Syria to produce regime change, and provoke Russia in Syria and Ukraine—because well anyway she’s better than Trump, and we all have to vote, don’t we”?

But why should anybody have to hold their nose while they vote? The whole process has been exposed as never before as a farce. Why participate at all in something so corrupt? Do you want to vote just to vote, to publicly display the fact that you believe in the system itself, like the North Koreans who routinely go to the polls patriotically to vote for the options available? (As you may know, in some elections in the DPRK you can vote for a candidate of the Workers’ Party of Korea, Chondoist Chogu Party, Korean Social Democratic Party or independent. There is the manicured appearance of multiparty democracy—just like here. And no doubt some people feel good after the voting, knowing they’ve done their civic duty in a system they believe in. But what if you’ve woken up and don’t believe in the system anymore?)

Why not think bigger, and beyond? Either Clinton or Trump will likely take office in January, as the most unpopular newly elected president of all time. Either will have been brought to power by a manifestly anti-democratic, corrupt process that, more than in past years, is well exposed this time. Either will be vulnerable to mass upheaval, in the wake of Mexico wall construction or the announcement of a Syrian no-fly zone. Appalled by the election choices and result, the majority could maybe consider targeting the rigged system itself.

Just a suggestion. Massive demonstrations in Washington on Inaugural Day by people who have come to reject its legitimacy itself, knowing that it’s run by the One Percent to whom black lives don’t matter, drone warfare is cool and global warming is a hoax. Posters and banners with the curt, easy-to-understand and undeniably true popular slogan: THE WHOLE SYSTEM IS RIGGED!

Imagine a huge rally Jan. 20 demanding its overthrow, or at least the immediate resignation of the system’s illegitimate new executive, even if we don’t know what comes next. Imagine the admiration that would invite throughout the world, the hope it would inspire should the people of this country rise up to challenge not just a war, policy or person but the corrupt (capitalist and imperialist) system under which we live.

***

Now I read that the FBI, directed by James Comey (who recommended no charges for Clinton for her private cell phone use but left open the prospect of recommending criminal charges against Clinton for abusing her office to profit the Clinton Foundation) in fact has recommended charges against Hillary.

But the Department of Justice headed by Clinton loyalist Loretta Lynch rejected the recommendation. Because—don’t you see?—Hillary has to be the next president. To stop Trump, at all costs! And to stop Putin, that aggressive Putin. And to keep together the “Clinton Coalition.”

Good job, Loretta! But regardless of your effort, Hillary’s Pinocchio nose grows longer by the day, while the whole system is exposed as a cancer requiring the most aggressive treatment.

Gary Leupp is Professor of History at Tufts University, and holds a secondary appointment in the Department of Religion. He is the author of Servants, Shophands and Laborers in in the Cities of Tokugawa Japan; Male Colors: The Construction of Homosexuality in Tokugawa Japan; and Interracial Intimacy in Japan: Western Men and Japanese Women, 1543-1900. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion, (AK Press). He can be reached at: gleupp@tufts.edu

The Great Ponzi Scheme of the Global Economy

Posted on August 18, 2016 by Reid Mukai

By Michael Hudson and Chris Hedges

Source: CounterPunch

CHRIS HEDGES: We’re going to be discussing a great Ponzi scheme that not only defines not only the U.S. but the global economy, how we got there and where we’re going. And with me to discuss this issue is the economist Michael Hudson, author of Killing the Host: How Financial Parasites and Debt Destroy the Global Economy. A professor of economics who worked for many years on Wall Street, where you don’t succeed if you don’t grasp Marx’s dictum that capitalism is about exploitation. And he is also, I should mention, the godson of Leon Trotsky.

I want to open this discussion by reading a passage from your book, which I admire very much, which I think gets to the core of what you discuss. You write,

“Adam Smith long ago remarked that profits often are highest in nations going fastest to ruin. There are many ways to create economic suicide on a national level. The major way through history has been through indebting the economy. Debt always expands to reach a point where it cannot be paid by a large swathe of the economy. This is the point where austerity is imposed and ownership of wealth polarizes between the One Percent and the 99 Percent. Today is not the first time this has occurred in history. But it is the first time that running into debt has occurred deliberately.” Applauded. “As if most debtors can get rich by borrowing, not reduced to a condition of debt peonage.”

So let’s start with the classical economists, who certainly understood this. They were reacting of course to feudalism. And what happened to the study of economics so that it became gamed by ideologues?

HUDSON: The essence of classical economics was to reform industrial capitalism, to streamline it, and to free the European economies from the legacy of feudalism. The legacy of feudalism was landlords extracting land-rent, and living as a class that took income without producing anything. Also, banks that were not funding industry. The leading industrialists from James Watt, with his steam engine, to the railroads …

HEDGES: From your book you make the point that banks almost never funded industry.

HUDSON: That’s the point: They never have. By the time you got to Marx later in the 19th century, you had a discussion, largely in Germany, over how to make banks do something they did not do under feudalism. Right now we’re having the economic surplus being drained not by the landlords but also by banks and bondholders.

Adam Smith was very much against colonialism because that lead to wars, and wars led to public debt. He said the solution to prevent this financial class of bondholders burdening the economy by imposing more and more taxes on consumer goods every time they went to war was to finance wars on a pay-as-you-go basis. Instead of borrowing, you’d tax the people. Then, he thought, if everybody felt the burden of war in the form of paying taxes, they’d be against it. Well, it took all of the 19th century to fight for democracy and to extend the vote so that instead of landlords controlling Parliament and its law-making and tax system through the House of Lords, you’d extend the vote to labor, to women and everybody. The theory was that society as a whole would vote in its self-interest. It would vote for the 99 Percent, not for the One Percent.

By the time Marx wrote in the 1870s, he could see what was happening in Germany. German banks were trying to make money in conjunction with the government, by lending to heavy industry, largely to the military-industrial complex.

HEDGES: This was Bismarck’s kind of social – I don’t know what we’d call it. It was a form of capitalist socialism…

HUDSON: They called it State Capitalism. There was a long discussion by Engels, saying, wait a minute. We’re for Socialism. State Capitalism isn’t what we mean by socialism. There are two kinds of state-oriented–.

HEDGES: I’m going to interject that there was a kind of brilliance behind Bismarck’s policy because he created state pensions, he provided health benefits, and he directed banking toward industry, toward the industrialization of Germany which, as you point out, was very different in Britain and the United States.

HUDSON: German banking was so successful that by the time World War I broke out, there were discussions in English economic journals worrying that Germany and the Axis powers were going to win because their banks were more suited to fund industry. Without industry you can’t have really a military. But British banks only lent for foreign trade and for speculation. Their stock market was a hit-and-run operation. They wanted quick in-and-out profits, while German banks didn’t insist that their clients pay as much in dividends. German banks owned stocks as well as bonds, and there was much more of a mutual partnership.

That’s what most of the 19^th century imagined was going to happen – that the world was on the way to socializing banking. And toward moving capitalism beyond the feudal level, getting rid of the landlord class, getting rid of the rent, getting rid of interest. It was going to be labor and capital, profits and wages, with profits being reinvested in more capital. You’d have an expansion of technology. By the early twentieth century most futurists imagined that we’d be living in a leisure economy by now.

HEDGES: Including Karl Marx.

HUDSON: That’s right. A ten-hour workweek. To Marx, socialism was to be an outgrowth of the reformed state of capitalism, as seemed likely at the time – if labor organized in its self-interest.

HEDGES: Isn’t what happened in large part because of the defeat of Germany in World War I? But also, because we took the understanding of economists like Adam Smith and maybe Keynes. I don’t know who you would blame for this, whether Ricardo or others, but we created a fictitious economic theory to praise a rentier or rent-derived, interest-derived capitalism that countered productive forces within the economy. Perhaps you can address that.

HUDSON: Here’s what happened. Marx traumatized classical economics by taking the concepts of Adam Smith and John Stuart Mill and others, and pushing them to their logical conclusion. Progressive capitalist advocates – Ricardian socialists such as John Stuart Mill – wanted to tax away the land or nationalize it. Marx wanted governments to take over heavy industry and build infrastructure to provide low-cost and ultimately free basic services. This was traumatizing the landlord class and the One Percent. And they fought back. They wanted to make everything part of “the market,” which functioned on credit supplied by them and paid rent to them.

None of the classical economists imagined how the feudal interests – these great vested interests that had all the land and money – actually would fight back and succeed. They thought that the future was going to belong to capital and labor. But by the late 19^th century, certainly in America, people like John Bates Clark came out with a completely different theory, rejecting the classical economics of Adam Smith, the Physiocrats and John Stuart Mill.

HEDGES: Physiocrats are, you’ve tried to explain, the enlightened French economists.

HUDSON: The common denominator among all these classical economists was the distinction between earned income and unearned income. Unearned income was rent and interest. Earned incomes were wages and profits. But John Bates Clark came and said that there’s no such thing as unearned income. He said that the landlord actually earns his rent by taking the effort to provide a house and land to renters, while banks provide credit to earn their interest. Every kind of income is thus “earned,” and everybody earns their income. So everybody who accumulates wealth, by definition, according to his formulas, get rich by adding to what is now called Gross Domestic Product (GDP).

HEDGES: One of the points you make in Killing the Host which I liked was that in almost all cases, those who had the capacity to make money parasitically off interest and rent had either – if you go back to the origins – looted and seized the land by force, or inherited it.

HUDSON: That’s correct. In other words, their income is unearned. The result of this anti-classical revolution you had just before World War I was that today, almost all the economic growth in the last decade has gone to the One Percent. It’s gone to Wall Street, to real estate …

HEDGES: But you blame this on what you call Junk Economics.

HUDSON: Junk Economics is the anti-classical reaction.

HEDGES: Explain a little bit how, in essence, it’s a fictitious form of measuring the economy.

HUDSON: Well, some time ago I went to a bank, a block away from here – a Chase Manhattan bank – and I took out money from the teller. As I turned around and took a few steps, there were two pickpockets. One pushed me over and the other grabbed the money and ran out. The guard stood there and saw it. So I asked for the money back. I said, look, I was robbed in your bank, right inside. And they said, “Well, we don’t arm our guards because if they shot someone, the thief could sue us and we don’t want that.” They gave me an equivalent amount of money back.

Well, imagine if you count all this crime, all the money that’s taken, as an addition to GDP. Because now the crook has provided the service of not stabbing me. Or suppose somebody’s held up at an ATM machine and the robber says, “Your money or your life.” You say, “Okay, here’s my money.” The crook has given you the choice of your life. In a way that’s how the Gross National Product accounts are put up. It’s not so different from how Wall Street extracts money from the economy. Then also you have landlords extracting …

HEDGES: Let’s go back. They’re extracting money from the economy by debt peonage. By raising …

HUDSON: By not playing a productive role, basically.

HEDGES: Right. So it’s credit card interest, mortgage interest, car loans, student loans. That’s how they make their funds.

HUDSON: That’s right. Money is not a factor of production. But in order to have access to credit, in order to get money, in order to get an education, you have to pay the banks. At New York University here, for instance, they have Citibank. I think Citibank people were on the board of directors at NYU. You get the students, when they come here, to start at the local bank. And once you are in a bank and have monthly funds taken out of your account for electric utilities, or whatever, it’s very cumbersome to change.

So basically you have what the classical economists called the rentier class. The class that lives on economic rents. Landlords, monopolists charging more, and the banks. If you have a pharmaceutical company that raises the price of a drug from $12 a shot to $200 all of a sudden, their profits go up. Their increased price for the drug is counted in the national income accounts as if the economy is producing more. So all this presumed economic growth that has all been taken by the One Percent in the last ten years, and people say the economy is growing. But the economy isn’t growing …

HEDGES: Because it’s not reinvested.

HUDSON: That’s right. It’s not production, it’s not consumption. The wealth of the One Percent is obtained essentially by lending money to the 99 Percent and then charging interest on it, and recycling this interest at an exponentially growing rate.

HEDGES: And why is it important, as I think you point out in your book, that economic theory counts this rentier income as productive income? Explain why that’s important.

HUDSON: If you’re a rentier, you want to say that you earned your income by …

HEDGES: We’re talking about Goldman Sachs, by the way.

HUDSON: Yes, Goldman Sachs. The head of Goldman Sachs came out and said that Goldman Sachs workers are the most productive in the world. That’s why they’re paid what they are. The concept of productivity in America is income divided by labor. So if you’re Goldman Sachs and you pay yourself $20 million a year in salary and bonuses, you’re considered to have added $20 million to GDP, and that’s enormously productive. So we’re talking in a tautology. We’re talking with circular reasoning here.

So the issue is whether Goldman Sachs, Wall Street and predatory pharmaceutical firms, actually add “product” or whether they’re just exploiting other people. That’s why I used the word parasitism in my book’s title. People think of a parasite as simply taking money, taking blood out of a host or taking money out of the economy. But in nature it’s much more complicated. The parasite can’t simply come in and take something. First of all, it needs to numb the host. It has an enzyme so that the host doesn’t realize the parasite’s there. And then the parasites have another enzyme that takes over the host’s brain. It makes the host imagine that the parasite is part of its own body, actually part of itself and hence to be protected.

That’s basically what Wall Street has done. It depicts itself as part of the economy. Not as a wrapping around it, not as external to it, but actually the part that’s helping the body grow, and that actually is responsible for most of the growth. But in fact it’s the parasite that is taking over the growth.

The result is an inversion of classical economics. It turns Adam Smith upside down. It says what the classical economists said was unproductive – parasitism – actually is the real economy. And that the parasites are labor and industry that get in the way of what the parasite wants – which is to reproduce itself, not help the host, that is, labor and capital.

HEDGES: And then the classical economists like Adam Smith were quite clear that unless that rentier income, you know, the money made by things like hedge funds, was heavily taxed and put back into the economy, the economy would ultimately go into a kind of tailspin. And I think the example of that, which you point out in your book, is what’s happened in terms of large corporations with stock dividends and buybacks. And maybe you can explain that.

HUDSON: There’s an idea in superficial textbooks and the public media that if companies make a large profit, they make it by being productive. And with …

HEDGES: Which is still in textbooks, isn’t it?

HUDSON: Yes. And also that if a stock price goes up, you’re just capitalizing the profits – and the stock price reflects the productive role of the company. But that’s not what’s been happening in the last ten years. Just in the last two years, 92 percent of corporate profits in America have been spent either on buying back their own stock, or paid out as dividends to raise the price of the stock.

HEDGES: Explain why they do this.

HUDSON: About 15 years ago at Harvard, Professor Jensen said that the way to ensure that corporations are run most efficiently is to make the managers increase the price of the stock. So if you give the managers stock options, and you pay them not according to how much they’re producing or making the company bigger, or expanding production, but the price of the stock, then you’ll have the corporation run efficiently, financial style.

So the corporate managers find there are two ways that they can increase the price of the stock. The first thing is to cut back long-term investment, and use the money instead to buy back their own stock. But when you buy your own stock, that means you’re not putting the money into capital formation. You’re not building new factories. You’re not hiring more labor. You can actually increase the stock price by firing labor.

HEDGES: That strategy only works temporarily.

HUDSON: Temporarily. By using the income from past investments just to buy back stock, fire the labor force if you can, and work it more intensively. Pay it out as dividends. That basically is the corporate raider’s model. You use the money to pay off the junk bond holders at high interest. And of course, this gets the company in trouble after a while, because there is no new investment.

So markets shrink. You then go to the labor unions and say, gee, this company’s near bankruptcy, and we don’t want to have to fire you. The way that you can keep your job is if we downgrade your pensions. Instead of giving you what we promised, the defined benefit pension, we’ll turn it into a defined contribution plan. You know what you pay every month, but you don’t know what’s going to come out. Or, you wipe out the pension fund, push it on to the government’s Pension Benefit Guarantee Corporation, and use the money that you were going to pay for pensions to pay stock dividends. By then the whole economy is turning down. It’s hollowed out. It shrinks and collapses. But by that time the managers will have left the company. They will have taken their bonuses and salaries and run.

HEDGES: I want to read this quote from your book, written by David Harvey, in A Brief History of Neoliberalism, and have you comment on it.

“The main substantive achievement of neoliberalism has been to redistribute rather than to generate wealth and income. [By] ‘accumulation by dispossession’ I mean … the commodification and privatization of land, and the forceful expulsion of peasant populations; conversion of various forms of property rights (common collective state, etc.) into exclusive private property rights; suppression of rights to the commons; … colonial, neocolonial, and the imperial processes of appropriation of assets (including natural resources); … and usury, the national debt and, most devastating at all, the use of the credit system as a radical means of accumulation by dispossession. … To this list of mechanisms, we may now add a raft of techniques such as the extraction of rents from patents, and intellectual property rights (such as the diminution or erasure of various forms of common property rights, such as state pensions, paid vacations, and access to education, health care) one through a generation or more of class struggle. The proposal to privatize all state pension rights, pioneered in Chile under the dictatorship is, for example, one of the cherished objectives of the Republicans in the US.”

This explains the denouement. The final end result you speak about in your book is, in essence, allowing what you call the rentier or the speculative class to cannibalize the entire society until it collapses.

HUDSON: A property right is not a factor of production. Look at what happened in Chicago, the city where I grew up. Chicago didn’t want to raise taxes on real estate, especially on its expensive commercial real estate. So its budget ran a deficit. They needed money to pay the bondholders, so they sold off the parking rights to have meters – you know, along the curbs. The result is that they sold to Goldman Sachs 75 years of the right to put up parking meters. So now the cost of living and doing business in Chicago is raised by having to pay the parking meters. If Chicago is going to have a parade and block off traffic, it has to pay Goldman Sachs what the firm would have made if the streets wouldn’t have been closed off for a parade. All of a sudden it’s much more expensive to live in Chicago because of this.

But this added expense of having to pay parking rights to Goldman Sachs – to pay out interest to its bondholders – is counted as an increase in GDP, because you’ve created more product simply by charging more. If you sell off a road, a government or local road, and you put up a toll booth and make it into a toll road, all of a sudden GDP goes up.

If you go to war abroad, and you spend more money on the military-industrial complex, all this is counted as increased production. None of this is really part of the production system of the capital and labor building more factories and producing more things that people need to live and do business. All of this is overhead. But there’s no distinction between wealth and overhead.

Failing to draw that distinction means that the host doesn’t realize that there is a parasite there. The host economy, the industrial economy, doesn’t realize what the industrialists realized in the 19^th century: If you want to be an efficient economy and be low-priced and under-sell competitors, you have to cut your prices by having the public sector provide roads freely. Medical care freely. Education freely.

If you charge for all of these, you get to the point that the U.S. economy is in today. What if American factory workers were to get all of their consumer goods for nothing. All their food, transportation, clothing, furniture, everything for nothing. They still couldn’t compete with Asians or other producers, because they have to pay up to 43% of their income for rent or mortgage interest, 10% or more of their income for student loans, credit card debt. 15% of their paycheck is automatic withholding to pay Social Security, to cut taxes on the rich or to pay for medical care.

So Americans built into the economy all this overhead. There’s no distinction between growth and overhead. It’s all made America so high-priced that we’re priced out of the market, regardless of what trade policy we have.

HEDGES: We should add that under this predatory form of economics, you game the system. So you privatize pension funds, you force them into the stock market, an overinflated stock market. But because of the way companies go public, it’s the hedge fund managers who profit. And it’s those citizens whose retirement savings are tied to the stock market who lose. Maybe we can just conclude by talking about how the system is fixed, not only in terms of burdening the citizen with debt peonage, but by forcing them into the market to fleece them again.

HUDSON: Well, we talk about an innovation economy as if that makes money. Suppose you have an innovation and a company goes public. They go to Goldman Sachs and other Wall Street investment banks to underwrite the stock to issue it at $40 a share. What’s considered a successful float is when, immediately, Goldman and the others will go to their insiders and tell them to buy this stock and make a quick killing. A “successful” flotation doubles the price in one day, so that at the end of the day the stock’s selling for $80.

HEDGES: They have the option to buy it before anyone else, knowing that by the end of the day it’ll be inflated, and then they sell it off.

HUDSON: That’s exactly right.

HEDGES: So the pension funds come in and buy it at an inflated price, and then it goes back down.

HUDSON: It may go back down, or it may be that the company just was shortchanged from the very beginning. The important thing is that the Wall Street underwriting firm, and the speculators it rounds up, get more in a single day than all the years it took to put the company together. The company gets $40. And the banks and their crony speculators also get $40.

So basically you have the financial sector ending up with much more of the gains. The name of the game if you’re on Wall Street isn’t profits. It’s capital gains. And that’s something that wasn’t even part of classical economics. They didn’t anticipate that the price of assets would go up for any other reason than earning more money and capitalizing on income. But what you have had in the last 50 years – really since World War II – has been asset-price inflation. Most middle-class families have gotten the wealth that they’ve got since 1945 not really by saving what they’ve earned by working, but by the price of their house going up. They’ve benefited by the price of the house. And they think that that’s made them rich and the whole economy rich.

The reason the price of housing has gone up is that a house is worth whatever a bank is going to lend against it. If banks made easier and easier credit, lower down payments, then you’re going to have a financial bubble. And now, you have real estate having gone up as high as it can. I don’t think it can take more than 43% of somebody’s income to buy it. But now, imagine if you’re joining the labor force. You’re not going to be able to buy a house at today’s prices, putting down a little bit of your money, and then somehow end up getting rich just on the house investment. All of this money you pay the bank is now going to be subtracted from the amount of money that you have available to spend on goods and services.

So we’ve turned the post-war economy that made America prosperous and rich inside out. Somehow most people believed they could get rich by going into debt to borrow assets that were going to rise in price. But you can’t get rich, ultimately, by going into debt. In the end the creditors always win. That’s why every society since Sumer and Babylonia have had to either cancel the debts, or you come to a society like Rome that didn’t cancel the debts, and then you have a dark age. Everything collapses.

Michael Hudson’s new book, Killing the Host is published in e-format by CounterPunch Books and in print by Islet. He can be reached via his website, mh@michael-hudson.com. Chris Hedges’s latest book is Days of Destruction, Days of Revolt, illustrated by Joe Sacco.

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