Category Archives: Recession

In a highly indebted world, austerity is a permanent state of affairs

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By Mark Blyth

Source: Aeon

By 2010, everyone had heard the ‘austerity’ rallying cry. Immediately following the 2008 financial crisis, especially in Europe, it resounded: ‘Stimulate no more, now is the time for all to tighten!’ And tighten governments did, cutting public expenditure across continental Europe, and in the United Kingdom and the United States.

The logic behind ‘austerity’ holds that ‘the market’ – which the public had just bailed out – did not like the debt incurred when states everywhere rescued and recapitalised their banking systems. Unsurprisingly, tax revenues fell as the economy slowed and state expenditures rose. And what were once private debts on the balance sheets of banks became public debt on the balance sheet of states. Given this sorry state of affairs, states (policymakers and business leaders argued) had to take action to restore ‘business confidence’ – which is apparently always and everywhere created by cutting government spending. So governments cut.

Public debt, however, grew, because economies got smaller and grew slower the more they cut. The ‘confidence fairy’ as Paul Krugman named the expected effect, simply failed to show up. Why?

The reason is simple – and it is surprising anyone thought that anything else would happen. Imagine an economy as a sum, with a numerator and a denominator. Make total debt 100 and stick that on the top (the numerator). Make Gross Domestic Product (GDP) 100 and stick that on the bottom (the denominator) to give us a 100 per cent debt-to-GDP ratio. If you cut total spending by 20 per cent to restore ‘confidence’, the economy is ‘balanced’ at 100/80. That means the debt-to-GDP ratio of the country just went up to 120 per cent, all without the government issuing a single cent of new debt.

In short, cuts to spending in a recession make the underlying economy contract. After all, government workers have lost jobs or income, and government workers not shopping has the same effect as private sector workers not shopping. So the debt goes up as the economy shrinks further. States respond by cutting spending further. The pattern continues.

Having a common currency among different countries actually aggravates the problem because cuts in one state reverberate through many states, depressing them all. In 2008, euro area government debt as a share of the economy, including the already profligate Greeks, averaged around 65 per cent of GDP. Following budget cuts and monetary tightening (the European Central Bank twice pushed up interest rates in 2011) Euro Area government debt, by 2014, had risen to 92 per cent of GDP.

Greece is the poster child for this ‘denominator effect’. Under the auspices of ‘bailouts’ from the IMF and the EU, Greece cut more than 20 per cent of GDP in spending. It lost nearly 30 per cent in final consumption. Yet its debt increased from 103 per cent in 2006 to more than 180 per cent by 2014. That’s a 57 per cent increase in debt while spending is being cut.

Let’s look at the originating question again: how is destroying a third of the economy supposed to inspire consumer and business confidence? It won’t – unless you are a creditor – and that’s where the politics comes in.

If you are a holder of government debt (a creditor), three things hurt the value of your asset: if the inflation rate goes above the interest rate on your bond; if the exchange rate moves against you so that what the bond is worth vis-à-vis other currencies falls; and, of course, default – if the government takes the money and runs.

In the post-crisis world, despite major central banks putting trillions of dollars into the global money supply, there is almost no inflation anywhere in the developed world. Exchange rates (Brexit effects apart) are comparatively stable and ultimately move against each other relatively, so that’s not a huge worry. If the country whose debt you hold can have elections, and the public dares to vote against more budget cuts, the European Central Bank will shut down their banking system to make them revisit their choices. That’s what they did to Greece in the summer of 2015.

In this world, our present world, creditors will get paid and debtors will get squeezed. Budgets will be cut to make sure that bondholders get their money. And, in a highly indebted world, austerity – introduced as an ‘emergency’ measure to save the economy, to right the fiscal ship – becomes a permanent state of affairs.

As Britain’s former prime minister David Cameron said (standing beside a throne in a white bow-tie and tails) in 2013: ‘We need to do more with less. Not just now, but permanently.’ But here’s the question hidden in that blithe statement – are you and me part of the ‘we’ here?

Let’s go back to the huge jump in public debt that occurred when governments, ie the people, bailed out the banks. That debt was not, and is not, a liability. As difficult as it can be to make this reality part of the political conversation, public debt is an asset. Even at today’s low rates, it earns interest and retains value. No one is forced to invest in public debt, but every time bonds are issued investors show up and buy them by the truckload. By market criteria, public debt is a great investment.

But who pays for it? That would be the taxpayer. More generally, those who contribute to the payment of debts by not consuming government-produced services that have been cut. Basically, in most countries, this means that the bottom 70 per cent of the income distribution bears the cost of paying for public debt.

Over the past 25 years, to make up for chronically low wage growth, that same 70 per cent of the population has increased its personal indebtedness. Massively. Which means that in an economy deformed by austerity, they are the ones paying out – twice. With stagnant or declining wages, they have to service both the massive private debt they have accumulated to live and the public debt issued in their name.

Meanwhile, those whose assets the public bailed out – those with investible wealth, those who hold ‘all that debt’ and make money from it – do not suffer from the decline in public spending. Since they are net lenders, the hike in personal indebtedness does not trouble them either.

The result, and the situation in which we find ourselves, is a classic bad equilibrium. Those who can’t pay, and don’t earn enough, are being asked to pay the most to service debt, from which they do not and will not benefit. Those who can pay, and earn almost all the income, both contribute the least and benefit the most from ‘all that debt’.

Strip away all the electoral politics at the moment in the US, the UK, Italy, Spain and elsewhere, and that’s the underlying political economy. It’s a creditor/debtor stand-off where the creditors have the whip hand.

And yet, the more they crack the whip, the more the backlash against austerity, in all its forms, gains strength. Donald Trump, Jeremy Corbyn, Marine Le Pen, Pablo Iglesias: Left or Right, they are all riding debtor anger against creditor strength. It might be expressed as anger against, variously, ‘trade’ or ‘the elite’ or the ‘EU’. But what’s underneath all that is the politics of debt.

This is the ‘new normal’. It’s not about flat interest rates or anaemic growth rates. They are the consequences of austerity, not its causes. The new normal is the new politics of debtors versus creditors. It’s here to stay. As we already can see, it’s going to be anything but normal.

The Mainstream Has Failed

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By Charles Hugh Smith

Source: Of Two Minds

The good news is there is a way to avoid failure and stagnation: avoid the mainstream like the plague.

The mainstream became mainstream because it worked: the mainstream advice to “go to college and you’ll get a good job” worked, the mainstream financial plan of buying a house to build equity to pass on to your children worked, the mainstream of government regulation worked to the public’s advantage at modest cost to taxpayers and the mainstream media, despite being cozy with government agencies such as the C.I.A. and operating as a profit machine for the families that owned the newspapers, radio stations, etc., functioned as a basically honest broker of information and reporting.

Now, the mainstream has failed. Mainstream career advice now leads to crushing debts and career stagnation, mainstream financial planning generates high risks, mainstream government regulations are costly and burdensome, and the mainstream media is little more than a corporate-owned mouthpiece of propaganda and distributor of infotainment that is sold as “news.”

Does anyone actually believe the mainstream political process isn’t broken? Those who claim it isn’t broken are either well-paid shills just doing their job or they’re delusional.

The mainstream American diet now leads to chronic disease and early death.Supersized portions, large amounts of sugar and/or salt in virtually every packaged food item, heavy doses of low-quality fats in almost all mainstream fast foods–these have become mainstream at a very high cost in diminished health and reduced years of life free of chronic disease and pain.

The mainstream level of fitness contributes to chronic disease and early death.The mainstream lifestyle is one in which people passively watch a few daredevils pursue extreme sports on a variety of digital screens, passively “consume” music rather than learning to play music themselves, passively consume “news” rather than being engaged in community activities that make news, and so on.

The mainstream healthcare system is structured so it is incapable of promoting health. As my longtime friend GFB recently asked, “Who is happy with the current healthcare system?” Certainly not the doctors and nurses or the patients. Perhaps Big Pharma is happy as a result of their enormous profits (more of which is spent on marketing the latest marginally useful and often dangerous drug than on R&D), but even Big Pharma has legitimate complaints about the cost and time required to get a potentially life-changing drug (such as immunotherapy drugs) through the pipeline.

But the real problem is the soaring costs of the system will eventually collapse the entire economy. The same can be said of the soaring costs of increasingly marginal higher education, the soaring costs of increasingly marginal weapons systems, and so on.

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The mainstream healthcare system is incapable of promoting health or restraining costs:

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The other problem with the mainstream is that any attempt to structurally reform these broken systems will trigger collapse. The mainstream systems are now so fragile that any significant change will cause them to implode. I explain why in my book Why Our Status Quo Failed and Is Beyond Reform.

The good news is there is a way to avoid failure and stagnation: avoid the mainstream like the plague. Stop eating packaged and fast foods, eat restaurant meals only occasionally, prepare 90% of your meals at home with real ingredients, including lots of fresh vegetables. Walk at least one mile/2 kilometers a day, start bicycling instead of driving (where possible), start doing yoga, tai chi, etc. every day, turn any 6-foot square floor area into your home gym–get lean.

Stop watching sports and start doing sports (appropriate to your age and climate, of course).

As for fashioning a sustainable career–don’t count on a college degree to work some sort of magic. I describe a more proactive approach to forging a sustainable career in my book Get a Job, Build a Real Career and Defy a Bewildering Economy.

Don’t accept “standards of care” that include addictive pain-killers and powerful meds that require another six meds with their own side-effects to counter the side-effects of the first med. Do you own research, get a second opinion. Discover what you can do to help heal yourself first.

Stop “consuming” mainstream media except in small, limited portions and consume even these portions with a skeptical eye and ear for propaganda and rigged numbers that supports failed mainstream narratives.

We are what we do every day. Step out of the mainstream and stay out of the mainstream and opportunities that are unavailable to those who passively accept the mainstream as “all there is” will emerge.

As Douglas MacArthur observed, “There is no security on this earth; there is only opportunity.”

If you’re interested in avoiding the mainstream of failure and stagnation, please consider these quotes drawn from my extensive list of Aphorisms:

“We are what we repeatedly do.” (Aristotle)

“Do the thing and you shall have the power.” (Ralph Waldo Emerson)

“Any intelligent fool can make things bigger, more complex, and more violent. It takes a touch of genius and a lot of courage to move in the opposite direction.” (E.F. Schumacher)

“He who will not risk cannot win.” (John Paul Jones)

And the Beat Goes On: Mega-rich get richer. Society Crumbles

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By Robert De Filippis

(OpEdNews.com)

While most of us have been taking our kids to Little League games, betting on the Super Bowl, taking an occasional vacation and waiting for the American Dream to become a reality, we haven’t noticed something important happening all around us. Society has been crumbling at the edges for the last several decades.

This is not to say that lots of human beings haven’t already experienced the early stages of this societal disintegration. But they tend to be the people at the margins. People without a voice. People whose interests are not understood, let alone represented in the great debates of our times.

Think of the Mideast. Think ISIS here. Think of terrorism. Terrorists don’t attack us because of our freedoms. They attack out of desperation. Out of a frustration that comes with no future, and a feeling of impotence in the face of the continued economic violence committed in the name of corporate profits and greed. Corporations protected by the most powerful military in the history of the world. Ours!

Is it any mystery why we have over six hundred military installations in other countries around the world? We’re not under threat from anyone, but our corporation’s interests in those countries must be protected while they rape them of their labor and natural resources.

History is written by the victors and the popular public narratives are circumscribed by those whose interests they serve and not those who suffer. At the core of this phenomenon is complicity. A subconscious complicity made up of an ultra-resistant trifecta of human thinking — greed, ignorance, and certainty.

Greed now normalized has made the great American dream indistinguishable from having basic financial security to making everyone a billionaire-in-waiting. An inability to distinguish fact from opinion leads the wave of ignorance that engulfs us. Our arrogance disguised as fervent patriotism defends our ignorance and allows us to reject the knowledge we need to save ourselves.

Our generalized confusion of what constitutes a fact allows an individual’s certainty to form a resistance similar to the bacterial infections that threaten to make modern antibiotics useless. It continues to evolve. “If I can’t figure out who’s lying, I’ll believe the one who confirms my point of view. Of that I’m certain.”

Until we learn that having our beliefs validated by a media being paid to manipulate us for political gain, society will continue to disintegrate for larger and larger groups of people.

Seems like a stretch, I know. But think about how we’ve become polarized. How we are so sure of our positions that we just can’t have a conversation with those from the other side. The very conversation we need to have to figure out how we’re being duped. Then think about how our politicians use the greed, ignorance and certainty on both sides to work us up into an emotional lather. And finally, how they ignore our interests while they do the bidding of their owners keeping us distracted with our petty differences with each other.

This will come to an end. There will either be a major social revolution at the least or outright raw violence at the worst. As the authority structures lose the willing conformance of the masses, all that’s left to police them is force. And at some point – like is beginning now — the response will be violence in return. Think of the proliferation of guns in America. Think of people shooting police.

It doesn’t take much discernment to see that corporate structures are highly sophisticated mechanisms for funneling money upwards. That government collusion protects the interests of the owners of capital at the expense of the employees, customers, the general public. And the military protects their international interests.

The largest wealth producer in the world is the financial industry that simply makes money from money and produces nothing. It serves no interests but its own. Yes, some of us fortunate to have salvaged what’s left of our life savings after repeated financial crashes still enjoy the crumbs from the tables of the elite. I do mean crumbs.

Do the math. At the current rate of the upward movement of wealth, there is no other outcome but final disaster. The top 1/10th of 1 percent — not 1 percent — but 1/10th of 1 percent in America owns almost as much wealth as the bottom 90 percent in America, and it gets worse as you leave our shores.

At this rate, the world will eventually consist of gated enclaves of the mega-wealthy guarded by elite corps of paid mercenaries surrounded by billions of impoverished people.

This trajectory has increased dramatically for the last several decades. More and more of the world’s wealth is pouring into the coffers of the mega-rich. This is a zero sum game. When the masses have no wealth left, the game will be over. No matter how powerful the wealthy are, no matter how much wealth they possess, the game will be over.

Five Ways America Is Like a Third-World Country

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By Nathan Wellman

Source: U.S. Uncut

The United States of America is possibly the wealthiest nation in the history of the world. However, many third-world countries actually surpass America in many of the most vital gauges for measuring human development.

Here are five of the most jaw-droppingly unforgivable ways in which America is lagging behind the rest of the world:

1. America’s criminal justice system is broken

The U.S. represents only 5% of the world’s population, but this one country comprises 25% of the world’s prison population. According to the NAACP, a disproportionate 58% of America’s prisoners are African-American or Hispanic despite these demographics only adding up to about 30% of the U.S. population.

The only nation that imprisons a greater percentage of its citizens than America is North Korea. The U.S. jails 716 people for every 100,000 Americans, according to the International Center for Prison Studies. That’s nearly twice as many as Russia (484 prisoners per 100,000), and far more than Iran (284) or China (121). For context, the U.S. only jailed around 100-200 people per 100,000 citizens in the 1970s, and the incarcerated rate is only getting worse today, even as crime rates fall. A staggering 60% of prisoners are in jail for nonviolent drug charges.

Inside prison, about 600 victims are raped every day, according to an estimate from the Justice Department. An in-depth DOJ investigation found that of the approximate 217,000 prisoners raped each year, 17,000 were juveniles.

2. Gun Violence is an epidemic

America has 20 times more murders when compared to the average rate of the developed world. Even terrorism-plagued Iraq has half the murder rate of the U.S. Over half of the deadliest mass shootings from the last 50 years happened in America, and 79% of those shooters got ahold of their guns legally. Some American cities, particularly New Orleans and Detroit, even surpass many Latin American countries, which suffer from some of the highest gun violence rates in the world.

3. Healthcare costs too much and delivers too little

America is the only developed country that does not ensure healthcare to all of its citizens. Even in the wake of the Affordable Care Act, millions of poverty-stricken Americans have no medical insurance because Republican governors have refused to expand Medicaid, even though the federal government is paying the cost and the simple measure would actually save money for their states.

Life expectancy in many American counties is lower than Nicaragua, Algeria, or Bangladesh. The U.S. is unusual among developed countries in that Americans die in the tens of thousands as a direct result of a lack of health insurance. America also spends twice the percentage of our GDP on healthcare than the average wealthy country for these substandard results.

America also suffers from the highest infant mortality and teen pregnancy rate in the developed world.

4. Inequality is rampant

Researchers have shown that economic inequality directly correlates to public distrust in government representatives, as well as a decrease in health and well-being.

Unfortunately, the U.S. has the worst rates of income inequality in the world, according to the 2015 Global Wealth Report conducted by Allianz. The wealthiest one percent of Americans own nearly half of the nation’s wealth invested in stocks and mutual funds, and the overall gap between rich and poor has only grown since the recession, with almost all income gains going to the top 1% since 2009.

Despite the idea of America being a meritocracy, those born in the poorest 20% of the American population have less than a 3% chance of making it to the top quintile.

5. Infrastructure is crumbling

America is quite literally falling apart.

One study concludes that the U.S. needs to invest $3.6 trillion into infrastructure over the next six years. One out of every nine American bridges (66,405 bridges) have been labeled “structurally deficient.”

Water runs through dilapidated wooden pipes in certain parts of South Dakota, Alaska, and Pennsylvania. Some of Detroit’s sewer lines still used today were originally constructed in the mid-1800s.

A whopping 45% of Americans have no access to public transit, and the construction of the infamously still-incomplete Second Avenue subway line in New York City has been hit with delays dating all the way back to World War II.

 

America certainly has and continues to achieve greatness in many ways. But if we want to truly earn our oft-proclaimed slogan of “Greatest Country in the World,” these fatal flaws in our system must be acknowledged and addressed. Otherwise, the emperor will continue to parade about with no clothes, and we run the risk of being completely surpassed by a world marveling at our oblivious nakedness.

Slowly, Then All at Once

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By James Howard Kunstler

Source: Clusterfuck Nation

The staggering incoherence of the election campaign only mirrors the shocking incapacity of the American public, from top to bottom, to process the tendings of our time. The chief tending is permanent worldwide economic contraction. Having hit the resource wall, especially of affordable oil, the global techno-industrial economy has sucked a valve in its engine.

For sure there are ways for human beings to inhabit this planet, perhaps in a civilized mode, but not at the gigantic scale of the current economic regime. The fate of this order has nothing to do with our wishes or preferences. It’s going down whether we like it or not because it was such a violent anomaly in world history and the salient question is: how do we manage our journey to a new disposition of things. Neither Trump or Clinton show that they have a clue about the situation.

The quandary I describe is often labeled the end of growth. The semantic impact of this phrase tends to paralyze even well-educated minds, most particularly the eminent econ professors, the Yale lawyers-turned-politicos, the Wall Street Journal editors, the corporate poobahs of the “C-Suites,” the hedge fund maverick-geniuses, and the bureaucratic errand boys (and girls) of Washington. In the absence of this “growth,” as defined by the employment and productivity statistics extruded like poisoned bratwursts from the sausage grinders of government agencies, this elite can see only the yawning abyss. The poverty of imagination among our elites is really something to behold.

As is usually the case with troubled, over-ripe societies, these elites have begun to resort to magic to prop up failing living arrangements. This is why the Federal Reserve, once an obscure institution deep in the background of normal life, has come downstage front and center, holding the rest of us literally spellbound with its incantations against the intractable ravages of debt deflation. (For a brilliant gloss on this phenomenon, read Ben Hunt’s essay “Magical thinking” at the Epsilon Theory website.)

One way out of this quandary would be to substitute the word “activity” for “growth.” A society of human beings can choose different activities that would produce different effects than the techno-industrial model of behavior. They can organize ten-acre farms instead of cell phone game app companies. They can do physical labor instead of watching television. They can build compact walkable towns instead of suburban wastelands (probably even out of the salvaged detritus of those wastelands). They can put on plays, concerts, sing-alongs, and puppet shows instead of Super Bowl halftime shows and Internet porn videos. They can make things of quality by hand instead of stamping out a million things guaranteed to fall apart next week. None of these alt-activities would be classifiable as “growth” in the current mode. In fact, they are consistent with the reality of contraction. And they could produce a workable and satisfying living arrangement.

The rackets and swindles unleashed in our futile quest to keep up appearances have disabled the financial operating system that the regime depends on. It’s all an illusion sustained by accounting fraud to conceal promises that won’t be kept. All the mighty efforts of central bank authorities to borrow “wealth” from the future in the form of “money” — to “paper over” the absence of growth — will not conceal the impossibility of paying that borrowed money back. The future’s revenge for these empty promises will be the disclosure that the supposed wealth is not really there — especially as represented in currencies, stock shares, bonds, and other ephemeral “instruments” designed to be storage vehicles for wealth. The stocks are not worth what they pretend. The bonds will never be paid off. The currencies will not store value. How did this happen? Slowly, then all at once.

We’re on a collision course with these stark realities. They are coinciding with the sickening vectors of national politics in a great wave of latent consequences built up by the sheer inertia of the scale at which we have been doing things. Trump, convinced of his own brilliance, knows nothing, and wears his incoherence like a medal of honor. Clinton literally personifies the horror of these coiled consequences waiting to spring — and the pretense that everything will continue to be okay with her in the White House (not). When these two gargoyle combatants meet in the debate arena a week from now, you will hear nothing about the journey we’re on to a different way of life.

But there is a clear synergy between the mismanagement of our money and the mismanagement of our politics. They have the ability to amplify each other’s disorders. The awful vibe from this depraved election might be enough to bring down markets and banks. The markets and banks are unstable enough to affect the election.

In history, elites commonly fail spectacularly. Ask yourself: how could these two ancient institutions, the Democratic and Republican parties, cough up such human hairballs? And having done so, do they deserve to continue to exist? And if they go up in a vapor, along with the public’s incomes and savings, what happens next?

Enter the generals.

Living In A Van Down By The River – Time To Face The True State Of The Middle Class In America

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By Michael Snyder

Source: InvestmentWatch

Do you remember the old Saturday Night Live sketches in which comedian Chris Farley portrayed a motivational speaker that lived in a van down by the river?  Unfortunately, this is becoming a reality for way too many Americans.  As the middle class has shrunk and the cost of living has increased, a lot of people have decided to quite literally “live on the road”.  Whether it is a car, a truck, a van, a bus or an RV, an increasing number of Americans are using their vehicles as their homes.  Just recently, someone that I know took a trip down the west coast of the United States and stayed at a number of campgrounds along the way.  What she discovered was that a lot of people were actually living at these campgrounds.  Of course there are some that actually prefer that lifestyle, but many others are doing it out of necessity.

Earlier this week, Circa.com posted a story about “the van life”.  One of the individuals that they featured was a recent graduate of the University of Southern California named Stephen Hutchins.  Without much of an income at the moment, he decided that the best way to cut expenses was to live in his van…

“The main expenses are insurance for the van, which is like $60 a month,” said Hutchins. “Then, I have a storage unit for like $60.”

That puts his monthly rent at $120. The van cost him just $125 at an auction.

Living in a van is certainly not the most comfortable way to go, and many of you are probably wondering how he performs basic tasks such as cooking and bathing.  Well, it turns out that he makes extensive use of public facilities…

He showers at the gym, cooks on a portable stove on a sidewalk (he stores his butane at his friends’ place nearby) and uses wifi at nearby coffeeshops.

For a while such a lifestyle may seem like “an adventure”, but after a while it will start to get really old.  And not a lot of women are going to be excited about dating a man that lives in a van, and you certainly wouldn’t want to raise a family in a vehicle.

Sadly, just like during the last economic crisis many Americans are getting to the point where staying in their homes may not be an option.  Just check out the following excerpt from a recent New York Post article entitled “The terrifying signs of a looming housing crisis“…

The number of New Yorkers applying for emergency grants to stay in their homes is skyrocketing — as the number of people staying in homeless shelters reached an all-time high last weekend, records show.

There were 82,306 applications for one-time emergency grants to prevent evictions in fiscal 2016, up 26 percent from 65,138 requests the previous year, according to the Mayor’s Management Report.

I put a couple of phrases in that quote in bold because I really wanted you to notice a couple of things.

First of all, it is very alarming to hear that the number of New Yorkers staying in homeless shelters “reached an all-time high” last weekend.  I thought that we were supposed to be in an “economic recovery”, but apparently things in New York are rapidly getting worse.

Secondly, the fact that applications for emergency grants are up 26 percent compared to last year is another indication of how rough things are right now for average families in New York.  We all remember what happened when millions of families lost their homes to foreclosure across the nation during the last financial crisis, and nobody should want to see a repeat of that any time soon.

During this election season, Barack Obama and Hillary Clinton would like all of us to believe that the economy is doing just fine, but that is not true at all.  Even using the doctored numbers that the government gives us, Barack Obama is solidly on track to be the only president in all of U.S. history to never have a single year of 3 percent GDP growth, and he has had two terms to try to do that.

Gallup CEO Jim Clifton is also quite skeptical of this “economic recovery”, and he recently authored an article on this subject that is receiving a tremendous amount of attention.  The following is how that article begins…

I’ve been reading a lot about a “recovering” economy. It was even trumpeted on Page 1 ofThe New York Times and Financial Timeslast week.

I don’t think it’s true.

The percentage of Americans who say they are in the middle or upper-middle class has fallen 10 percentage points, from a 61% average between 2000 and 2008 to 51% today.

Other surveys have found that it is even worse than that.

For example, a Pew Research Center study from the end of last year discovered that the middle class in America has now actually become a minority in this country.

Here are some other numbers that Clifton included in his article…

  1. According to the U.S. Bureau of Labor Statistics, the percentage of the total U.S. adult population that has afull-time job has been hovering around 48% since 2010 — this is the lowest full-time employment level since 1983.
  2. The number of publicly listed companies trading on U.S. exchanges has been cut almost in half in the past 20 years — from about 7,300 to 3,700. Because firms can’t grow organically — that is, build more business from new and existing customers — they give up and pay high prices to acquire their competitors, thus drastically shrinking the number of U.S. public companies. This seriously contributes to the massive loss of U.S. middle-class jobs.
  3. New business startups are at historical lows. Americans have stopped starting businesses. And the businesses that do start are growing at historically slow rates.

Once upon a time, America was the land of opportunity.

We were the place where anything was possible and where entrepreneurship was greatly encouraged.

But today we strangle small businesses to death with rules, regulations, red tape and taxes.

If we want a stronger middle class, we need to create a much better environment for the creation of small businesses.  Small business ownership often lifts individuals into the middle class, and small businesses have traditionally been the primary engine for the growth of good jobs in this country.

If the middle class continues to shrink, poverty will continue to rise.  Previously I have written about how the number of homeless children in the United States has shot up by 60 percent since the last economic crisis, and Poverty USA claims that a staggering 1.6 million children slept either in a homeless shelter or in some other form of emergency housing during 2015.

If you will be sleeping in a warm bed in a comfortable home tonight, you should be thankful.  An increasing number of Americans are sleeping in tent cities, in their vehicles or on the streets.  These hurting people deserve our love, our compassion and our prayers.

 

Democracy Is Dead

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By Gilbert Mercier

Source: News Junkie Post

From the west to the east, and the south to the north of our global horizon, it is the same tableau: the horrendous killing fields of disaster capitalism where its cohorts of 18-wheelers, heavy road machinery and police patrol cars roam the landscape continuously and are turning us and the better principles of our humanity into countless road kills. Hell on Earth is to be our common fate, and we might have already reached a point of no return. The corporate hyenas and political vultures that generally constitute the global elite are joyfully feeding on the carcasses of justice and morality; rationality and empathy; common sense and the notion of public good; sound governance without corruption and equality before the law; and last but not least, freedom and fair governance through democracy.

Comparing this small group of depraved elite sociopaths, with not a trace of compassion or even consciousness to the scavengers of the natural world, is actually unfair to vultures and hyenas. Scavengers in nature have an important function in the ecosystem for their role of recycling waste. On the other hand, the few thousand rulers of global corporate imperialism are parasites weakening our common life force. If vultures are the useful garbage collectors of the natural world, the corrupt rulers of globalization are tics and leeches gorging on our blood. The British exit vote from the European Union, known as Brexit, has to be understood in the context of rejection of globalization. The global corporate world order has only worked for its masters but certainly not for the vast majority of the people, who are becoming the serfs of a new feudalism.

Calling the vote in favor of Brexit xenophobic doesn’t address the issues at stake. Cheap labor coming from Eastern Europe has served the interests of corporations and the rich very well, but it has had a negative impact on the welfare of British-born workers. This problem is general across the EU. The purpose of the EU was never to be a capitalist paradise where a free circulation of people, money, goods, and services would cater to the needs of multinational corporations, and where people ultimately would be uprooted to become the slaves of the so-called free market. The EU project was not centered on economic considerations but instead on cultural and social-value notions. It was a way out of the nightmare eras of World War I and World War II for founding members France and Germany. The formation of the EU was about a resolute rejection of war to embrace lasting peace. Other countries might follow the British people in their intention of leaving supra-national entities such as the EU. Paradoxically, the United Kingdom itself might disintegrate with the independence of Scotland, Wales, and Northern Ireland.

Globalists of all stripes are calling this nationalist revival narrow-minded and obscurantist. Their leading argument is that global problems such as climate change, overpopulation, and poverty require institutions with global authority. But what they should keep in mind is that those various supra-national institutions or entities, which started with stated good intentions, such as the United Nations, the World Bank, and the International Monetary Fund (IMF), not only have failed to solve any global problems but have, by their corrupt nature made them worse. In the case of the supra-national North Atlantic Treaty Organization (NATO), there is no pretense of being a do-gooder. The armed fist of the Orwellian empire is in the business of globalization of war with decisions made in Washington, DC.  In Orwellian times, many supra-national organizations behave like corporations under humanitarian pretenses, when they are in fact parasitic organisms depleting our strength. Meanwhile, no one represents We The People at all. In the world of humanitarianism for profit, public servants have vanished and been replaced by corrupt incompetent groups operating like crime families.

All members of the fake left advocate that the system must be changed progressively from within and that a collapse would be mainly a disaster for the poor and weak. This notion is as valid as to claim that a building destroyed by an earthquake is in need of some fresh window dressing. Regardless of the global elite’s arrogance, a systemic collapse is on its way and will exponentially take hold of the planet within two or three decades. The super-rich will eventually have nowhere to run or hide, and no private armies to protect them from the wrath of nature. Forcefully resisting the brand of globalization imposed on us by the thugs and slave drivers of disaster capitalism is a moral obligation all world citizens should embrace. When people in power live in the castle of their own lies, it is time to dismantle the fortress. When governance has lost all moral ground and reason, it is time to call for a revolution.

If, as human beings, we could understand that We The People should be all of us, regardless of geographic location, then perhaps the concept of globalization would serve a purpose and be beneficial. No workers in Europe and the United States should tolerate that people in places like Haiti, Vietnam, Bangladesh, and Honduras be paid slave wages; otherwise, down the line they will either lose their jobs or be exploited by the same corporations. Under the globalization of the plantation owners, the people are living in chains. Once upon a time, words like freedom, liberty, and democracy had meaning. They have largely been gutted out and are just empty shells, ghosts in a play of smoke and mirrors animated by the sinister masters of ceremony of the universal rat race. A first necessary step to take would be for all people still able to exercise free will and critical thinking to understand that what government and political representation has become is precisely the opposite of democracy. Voting under these kinds of circumstances is as delusional as giving substance to the figments of our own imaginations. When democracy is dead, it is time to boycott elections.

 

Gilbert Mercier is the author of The Orwellian Empire.

Lament for Humanity: A 50 Year Reflection

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Beryl & James Burrowes 1942 & 2016

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.