Tag Archives: economic inequality

Neoliberal Economics Destroyed the Economy and the Middle Class

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By Paul Craig Roberts

Source: PaulCraigRoberts.com

According to official US government economic data, the US economy has been growing for 10.5 years since June of 2009. The reason that the US government can produce this false conclusion is that costs that are subtrahends from GDP are not included in the measure. Instead, many costs are counted not as subtractions from growth but as additions to growth. For example, the penalty interest on a person’s credit card balance that results when a person falls behind his payments is counted as an increase in “financial services” and as an increase in Gross Domestic Product. The economic world is stood on its head.

It is aggregate demand that drives the economy. Payments made on a rise in interest rates on credit card balances from 19% to a 29% penalty rate reduce consumers’ ability to contribute to aggregate demand by purchasing goods and the services of doctors, lawyers, plumbers, electricians, and carpenters. Contrary to logic, the fee is magically counted in the “financial services” category as a contributor to GDP growth. The extortion of a fee that reduces aggregate demand lowers GDP, but builds paper wealth in the financial services sector.

GDP growth is also artificially inflated by counting as GDP abstract concepts that do not produce income streams. For example, for homeowners the US Department of Commerce estimates the rental values of owner-occupied housing, that is, the amount owners would be paying if they rented instead of owned their homes, and counts this imputed rent as GDP.

These and other absurdities have caused economist Michael Hudson to conclude correctly that the “financial reality of how the U.S. economy works is no longer captured in GDP statistics.”
https://michael-hudson.com/2019/10/asset-price-inflation-and-rent-seeking/

Today we have two economies. One is the real economy of production and consumption. The other is the financialized economy of paper wealth. The former is doing poorly, and the latter is doing well. The financialized economy is growing much faster than the real economy. Indeed, the real economy might not be growing at all.

Michael Hudson describes the difference. The stock market is at all time highs that have created massive wealth in financial assets for stock and bond owners. In the real economy the situation is totally different: “The Federal Reserve’s Report on the Economic Well-Being of U.S. Households in 2018 reports that 39% of Americans do not have $400 cash available for a medical or other emergency, and that a quarter of adults skipped medical care in 2018 because they could not afford it ( https://www.federalreserve.gov/publications/files/2018-report-economic-well-being-us-households-201905.pdf ). The latest estimates by the U.S. Government Accountability Office (GAO) report that nearly half (48 percent) of households headed by someone 55 and older lack any retirement savings or pension benefits ( https://www.aarp.org/retirement/retirement-savings/info-2019/no-retirement-money-saved.html ). Even in what the press calls an economic boom, most Americans feel stressed and many are chronically angry and worried. According to a 2015 survey by the American Psychological Association, financial worry is the “number one cause of stress in America today” ( https://www.apa.org/news/press/releases/2015/02/money-stress ).

The data is completely clear. The rich are becoming much richer, and the rest are becoming poorer. Michael Hudson explains:

“The creation and trading of property and financial assets at rising prices has been fueled by rising debt levels owed to the financial sector. This sector’s returns therefore are best seen not as real wealth on the asset side of the balance sheet, but as overhead on the liabilities side. And the process is multi-layered: income accruing to the financial wealth owned by the top 10 Percent is paid mainly by the bottom 90 percent in the form of rising debt service and other returns to financial and other property.

“In the textbook models of industrial capitalism’s mass production and consumption, an asset’s price is determined by its cost of production. If the price rises above this level, competitors will offer it cheaper. But in the financialized economy an asset’s price is determined by how much credit buyers can borrow to buy it, not by its cost of production. A home is worth as much as a bank will lend to a bidder.

“The engine of industrial capitalism and its consumer society is a positive feedback loop in which widely shared income growth, expanding consumption and markets generated yet more investment and growth. By contrast, the feedback loop of financial capitalism is an exponential growth of credit-driven debt, driving up asset prices and hence requiring yet more borrowing to buy homes, retirement income and other assets. Corporate management and investment today is mainly about obtaining capital gains for real estate, stocks and bonds than about earning income.

“We illustrate this by charting the flow of income and capital gains in the real estate sector to show the dominance of asset-price gains over net rental income – and how rental income is used up paying interest in our financialized economy. Likewise, corporate income is spent (and new debt taken on) largely for stock buybacks to raise share prices. The resulting dynamic is exponential and destabilizing.”

This dynamic is destabilizing, because as more of consumers’ discretionary income is drawn off to service mortgage, credit card, automobile and student debt and for compulsory health insurance, less is left to purchase the goods and services in the real economy. Consequently, credit-driven debt grows faster than the income that services it, and this impoverishes the 90%. However, for the 10%, money creation by the Federal Reserve in order to protect the balance sheets of the “banks too big to fail or jail” drives up the values of financial assets. As a result the distribution of income and wealth becomes hightly polarized.

Think about the many Americans who meet their living expenses by making only the minimum payment on their credit card balance. At 19% interest their debt grows monthly. Eventually they hit a credit card debt cap and can no longer use the card to cover their living expenses. But they have the burden of a large debt balance to service without an income stream capable of servicing it.

Think about the corporation that decapitalizes itself in order to produce short to intermediate term capital gains for shareholders and executives by indebting the firm in order to buy back the firm’s shares. The end result is that all income goes for debt service.

In a financialized economy, the only possible outcomes are debt forgiveness or collapse.

As Michael Hudson makes clear, the combination of nonsensical categories in the National Income and Product Accounts and a financialized economy means we have no accurate picture of the economy’s condition. Michael Hudson has a proposal for correcting these problems and making GDP accounting more accurate, but as ecological economists such as Herman Daly have made clear, GDP measurement also omits the external costs of production. This means that we do not know whether GDP is growing or declining. It is entirely possible that the ecological and social costs of an increase in GDP (as currently measured) are greater than the value of the increased output. (See Paul Craig Roberts, The Failure of Laissez-Faire Capitalism, https://www.amazon.com/Failure-Laissez-Faire-Capitalism/dp/0986036250/ref=sr_1_2?crid=16NHZEQ9G3JRW&keywords=paul+craig+roberts+books&qid=1576440032&s=books&sprefix=Paul+Craig%2Caps%2C173&sr=1-2 )

Perhaps the major way in which GDP is overstated is the exclusion of external or social costs. External or social costs are costs of producing a product that the producer does not incur but imposes on third parties or on the environment. For example, untreated sewage dumped into a stream imposes costs on people downstream. Runoff of chemical fertilizers from commercial farming produces dead zones in the Gulf of Mexico and toxic algal blooms such as Red Tide that result in massive fish kills, make seafood unsafe, cause human ailments and adversely impact the tourist trade of beach areas. The result is lost incomes, ruined vacations, health expenses, and none of these costs are born by the commercial farmers.

Real estate development produces massive external costs. Scenic views from existing properties are blocked, thus reducing their values. Construction noise and congestion impose costs on existing residents and reduces the quality of their lives. Water runoff problems are often created. Infrastructure has to be provided, such as larger highways to provide evacuation from hurricane-impacted areas, usually financed by taxpayers. If the global warming case is correct, the external cost of human economic activity can be the life of the planet.

Lakshmi Sarah in the May/June, 2019, issue of the Sierra Club magazine provides an excellent detailed account of the external costs of coal-fired power plants being built in India by the Indian conglomerate Tata with a loan from the International Finance Corporation, a branch of the World Bank. The ground water in the area has been ruined and is no longer drinkable. Farmers are no longer able to grow crops on half of the area farmland. Heated wastewater that is dumped into the Gulf of Kutch is destroying fishing. The ecology and the livelihoods of the population are essentially destroyed. None of these costs are born by the private power companies.

Tired of being doormats for capitalists and the World Bank, the residents of the affected provinces rebelled. They have succeeded in getting their case before the US Supreme Court. It seems that the International Finance Corporation is so accustomed to financing projects that produce large external costs that it overlooked its obligation to examine the environmental impact of the projects it finances. This oversight resulted in Indian farmers and fishermen getting their case before the US Supreme Court. The International Finance Corporation’s lawyers argued that the World Bank lending agency had “absolute immunity.” The Supreme Court said no and remanded the case to the circuit court to rule on the damages.

Perhaps the most surprising thing about this apparent victory for ordinary faraway little people in an American court against the World Bank, a principle instrument of American imperialism, is that the Trump administration appeared in court as a friend of the Indian farmers and fishermen. The US Solicitor General, represented by Jonathan Ellis, rejected the notion that international orgnizations have absolute immunity. The Establishment exists on its immunity. Here we see the ultimate reason that the ruling Establishment wants rid of Trump.

Already the senior staff of the International Finance Corporation have come to the realization that they have other responsibilities than just to shuffle money out the lending shute. If the Indian farmers and fishermen succeed in protecting themselves from ruination by external costs, perhaps Americans who suffer external costs will follow their lead.

Perhaps economists will also come to the realization that they owe us accurate GDP accounting and not fanciful accounts that serve elite wealth in the financialized economy.

The Unraveling Quickens

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By Charles Hugh Smith

Source: Of Two Minds

Even if we don’t measure the erosion of intangible capital, the social and political consequences of this impoverishment are manifesting in all sorts of ways.

The central thesis of my new book Will You Be Richer or Poorer? is the financial “wealth” we’ve supposedly gained (or at least a few of us have gained) in the past 20 years has masked the unraveling of our intangible capital: the resilience of our economy, our social capital, i.e. our ability to find common ground and solve real-world problems, our sense that the playing field, while not entirely level, is not two-tiered, and our sense of economic security–have all been shredded.

The unraveling of everything that actually matters is quickening. While every “news” outlet cheerleads the stock market (“The Dow soared today as investor optimism rose… blah blah blah”), our “leadership” and our media don’t even attempt to measure what’s unraveling, much less address the underlying causes.

The hope is that if we ignore what’s unraveling, it will magically go away. But that’s not how reality works.

The unraveling is gathering momentum because prices have been pushing higher while wages lag, feeding the rising precariousness and inequality of our economy. The connection between people losing ground and social disorder/disunity has been well established by historians such as Peter Turchin Ages of Discord and David Hackett Fischer The Great Wave: Price Revolutions and the Rhythm of History.

In our era, trust in the legitimacy of our institutions is unraveling because the statistics presented as “facts” are so clearly designed to support the status quo narrative that everything’s getting better every day in every way rather than the politically unwelcome reality that the bottom 95% are losing ground and whatever they do earn and own is increasingly at risk from forces outside their control.

Economic decay leads to social and political disorder / disunity. The sudden rise of vast homeless encampments is one manifestation of the social fabric unraveling. In the political realm, the insanity of accusing Democratic candidates of being “Russian agents” matches the hysterical destructiveness of the McCarthy era in the 1950s.

It all starts with economic decay, so let’s look at some charts. Here’s a chart of income inequality which helps drive wealth inequality.

Note that the only group that benefited from the past 20 years of speculative bubbles is the top 1%. The whole idea that inflating bubbles creates a “wealth effect” that “trickles down” is preposterous, as evidenced by the decline of the middle 60% of households while the speculators and owners of bubble-assets skimmed the vast majority of income gains.

Meanwhile, we’re told inflation is less than 2% annually while rising costs have outpaced meager wage increases. What’s a more realistic measure of real-world inflation–the official Consumer Price Index (CPI) at 18% over ten years or rent and healthcare at 34% and 45%?

According to the Chapwood Index, real-world inflation in urban America is running 9% to 13% annually. This is more in line with reality than the bogus CPI, as evidenced by this chart of wages and healthcare costs:

Even if we don’t measure the erosion of intangible capital, the social and political consequences of this impoverishment are manifesting in all sorts of ways: large-scale social disorder is breaking out around the globe, and the political middle ground has completely vanished: no matter which way an issue is decided, one camp will refuse to accept the outcome.

The only way forward with any chance of success is to start by acknowledging the decay of our economy due to rampant financialization, legalized looting, the pathologies of “winner take most” speculation and the realities of a two-tiered system in which entrenched elites are “more equal” than the rest of us, economically, socially and politically. We have to accept the limits of technology to reverse the unraveling and assess the damage that’s already been done to our shared capital.

Acting as if the system is working just fine and the problem is perception/optics is accelerating the unraveling.

Billionaires are a Sign of Economic Failure

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Inherited wealth and crony capitalism have created an aristocratic class that undermines social mobility and democracy

By Max Lawson

Source: Inequality.org

The New York Times published an editorial comment on its front page in January 2019, provocatively entitled “abolish billionaires.” The editorial raised a serious question: what if instead of being a sign of economic success, billionaires are a sign of economic failure?  In what ways can the boom in billionaires, and the dramatic increase in extreme wealth generally, be harmful?

To answer this question, we need to understand the origins of billionaire wealth, and to understand how that wealth is used once it is gained.  The answer to both these questions I think rightly casts doubt on the value of the super-rich in our society.

Approximately one third of billionaire wealth comes from inheritance. It is very hard to make the case for the economic utility of inherited wealth, and instead there is a strong case for the fact that it undermines social mobility and economic progress. It creates instead a new aristocracy who are rich simply because their parents were rich which is hard to see as a good thing.

Whether inherited or secured in other ways, extreme wealth takes on a momentum of its own.  The super-rich have the money to spend on the best investment advice, and billionaire wealth has increased since 2009 by an average of 11 percent a year, far higher than rates ordinary savers can obtain.

Bill Gates is worth nearly $100 billion dollars in 2019, almost twice what he was worth when he stepped down as head of Microsoft.  This is despite his admirable commitment to giving his money away.  As Thomas Piketty said in his book Capital in the 21st Century, “No matter how justified inequalities of wealth may be initially, fortunes can grow beyond any rational justification in terms of social utility.”

My Oxfam colleague Didier Jacobs calculated a few years ago that another third of billionaire wealth comes from crony connections to government and monopoly.  This could be for example when billionaires secure concessions to provide services exclusively from government, using crony connections and corruption.  The Economist has developed a similar measure of crony capitalism with similar findings. What is clear it seems to me is that corruption and crony connections to governments are behind a significant proportion of billionaire wealth.

Almost all sectors of our global economy are also now characterized by monopoly power, as is detailed by Nick Shaxson in his great new book, the Finance Curse. Whether food, pharmaceuticals, media, finance, or technology, each sector is characterized by a handful of huge corporations.

Decades of largely unquestioned mergers and acquisitions, where corporations have bought up competitors, have led to this.  Historically, and especially in the United States in the early part of the 20th century, monopoly power was rightly viewed as a serious threat to the economy and to society, and steps were taken to break up monopolies.  It was President Franklin Roosevelt who famously said that “government by organized money is just as dangerous as government by organized mob.” However, in recent decades, neoliberal economics has led a much more benign view of monopoly power, and very little action is now taken to dismantle them. I think this is a key distinction between neoliberalism and classical liberal economics.  These monopolies impose hidden monopoly taxes on every consumer, as it enables these companies, and their wealthy shareholders, to extract excessive profits from the market, directly fueling the growth in extreme wealth at the expense of ordinary citizens.

The actions of corporations, including the move towards monopoly, are driven by a relentless focus on ever-increasing returns to shareholders — shareholders who are primarily the very same extremely wealthy people.  Our new Oxfam paper on the “Seven Deadly Sins” of the G7, released this week, shows how returns to shareholders have increased dramatically whilst real wages have barely increased.

Behind corporate power and corporate actions is increasingly the power of super-rich shareholders.

Once billionaire wealth is accumulated, the way it is used also casts doubt on how useful it is to have billionaires.  The super-rich use their wealth to pay as little tax as possible, making active use of a secretive global network of tax havens, as revealed by the Panama Papers and other exposes.

One ground-breaking study that made use of this leaked information showed that the super-rich are paying as much as 30 percent less tax than they should, denying governments billions in lost tax revenue, that could have been spent on schools or on hospitals.  The super-rich are supported in this by the Society of Trust and Estate Practitioners (STEP), a secretive organization of over 20,000 wealth managers that actively pressures governments to reduce taxes on the richest.

Billions are not just used to ensure lower taxes. They can also be used to buy impunity from justice, to buy politicians, or to buy a pliant media.  The use of “dark” money to influence elections and public policy is a growing problem all over the world. The Koch brothers — Charles and the recently deceased David — two of the richest men in the world, have had a huge influence over conservative politics in the United States.

Another recent Oxfam study  showed the many ways in which politics has been captured by the very rich in Latin America.  Many of today’s new breed of nationalist, racist leaders have substantial financial backing.

This active political influencing by the super-rich directly drives greater inequality, by constructing reinforcing feedback loops, in which the winners of the game get even more resources to win even bigger next time.

For all these reasons, I think there is a strong case to be made that rather than being celebrated, as one U.S. commentator recently said, “every billionaire is a policy failure,” and that in particular if we are to end poverty and build fairer societies, we need to bring an end to extreme wealth.

Wealth Identity Politics: Billionaires Acting Like A Persecuted Minority Is Peak Capitalism

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By Caitlin Johnstone

Source: CaitlinJohnstone.com

“I guess maybe Bernie Sanders shouldn’t exist,” said billionaire Steve Schwarzman while seated in a library building named after billionaire Steve Schwarzman and promoting a book with billionaire Steve Schwarzman’s face on it.

According to Bloomberg this humble response from the always modest billionaire Steve Schwarzman came in response to a question posed by an audience member about a Sanders tweet in which the Vermont Senator said that billionaires should not exist. The comment was reportedly met with enthusiastic applause.

Blackstone CEO Schwarzman, who has previously compared tax increases on the wealthy to the Nazi invasion of Poland, is an oligarch by any reasonable definition. As one of America’s top individual campaign donors he is immensely influential; his plutocratic power is so deeply interwoven with the highest levels of government that his book’s 14 pages of acknowledgements describe cuddly relationships with a who’s-who of top US officials, including the last five presidents. According to a recent report by The Intercept, two Brazilian firms owned by Schwarzman “are significantly responsible for the ongoing destruction of the Amazon rainforest, carnage that has developed into raging fires that have captivated global attention.”

It is very telling that this oligarch sees an equivalence between (A) saying that an elite class should not control such vast amounts of wealth and (B) saying actual people should not exist. What this tells us is that Schwarzman sees being a billionaire as a fundamental part of his identity, making the idea that he shouldn’t control billions of dollars indistinguishable from saying that he himself should not exist. From his point of view he’s just doing the same thing that Sanders is doing: Bernie’s saying the thing that Schwarzman is shouldn’t exist, and Schwarzman is saying that Bernie himself shouldn’t exist. To him they’re the same.

This statement gives us a bit of insight into the way billionaires see themselves as fundamentally different than the rest of us, forming an egoic identity construct out of being a billionaire in the same way a medieval king would form an egoic identity construct out of that position. This anti-billionaire rhetoric is perceived as an attack on their very identity, which is why they are spinning it as though Sanders is calling for the elimination of actual people.

Predictably, Fox News is now trotting out billionaires to defend themselves from this outrageous billionairephobic bigotry, with Home Depot founder and major Republican Party donor Ken Langone receiving a warmly sycophantic reception from Fox’s Mornings with Maria.

“What the hell has he done for the little people?” Langone asked his host Maria Bartiromo. “What jobs has he created?”

Langone went on to detail all the many jobs he’s “created” (read: how many people he’s needed to hire to help him reap lucrative profits from an already existing demand) without bothering to explain what hoarding billions of dollars in offshore accounts has to do with job creation. Exponents of the “billionaires create jobs” argument always avoid this glaring plot hole like the plague.

Again, we see in Langone’s emotional response two things: that he sees ordinary citizens as “the little people” innately different from himself, and that he perceives the push toward greater economic equality as an existential threat.

“If you go back to 1933, with different words, this is what Hitler was saying in Germany,” Langone has said of the rising pushback against wealth and income inequality. “You don’t survive as a society if you encourage and thrive on envy or jealousy.”

These outbursts are reminiscent of one we saw a couple of years ago on an MSNBC interview with resort tycoon Stephen Cloobeck, who expressed outrage at the way progressives are using “the millionaire or billionaire word” to discuss issues with class and economic justice, saying he’d instructed Democratic Party leaders to bring a stop to this rhetoric or lose plutocratic funding.

“It is very, very disturbing when I hear the millionaire or billionaire word,” Cloobeck said, as though he was uttering an ethnic slur for an oppressed minority and not a conventional label for a class that effectively owns the US government. “And I’ve told them to stop it. Knock it off.”

We’re seeing this hilarious conflation of economic justice with the persecution of minorities and the elimination of actual human beings more and more often, so we should probably come up with a name for it. I’d like to propose that we label this phenomenon “wealth identity politics”, and it is capitalism’s dumbest turn yet.

It’s especially dumb because the billionaire class has already proven with its actions that it cannot exist without actively working to manipulate governments in a way that undeniably subverts democracy and the will of the people. The debate over whether or not billionaires should exist is long settled. They should not.

A few million dollars will buy you a nice car, a nice house and some nice clothes. A few billion dollars will buy you the ability to control public narratives using media ownership, lobbyists and think tanks, thereby manipulating entire governments and international affairs. Believing that it makes sense to have an elite class which controls this much wealth and power is exactly as stupid as believing it makes sense to have a total monarchy.

Billionaires should not exist, for the same reason that kings and pharaohs should not exist. The leadership of our world should not belong to a class of highly mediocre people who have nothing noteworthy between their ears apart from a knack for accumulating dollars. The ability to amass wealth is not a valid basis upon which to determine who leads us. Our fate as a species should be in all our hands.

The Real Big Brother

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By Eric Zuesse

Source: Consortium News

Jeff Bezos is the owner of The Washington Post, which leads America’s news-media in their almost 100 percent support and promotion of neoconservatism, American imperialism and wars. This includes sanctions, coups, and military invasions against countries that America’s billionaires want to control but don’t yet control — such as Venezuela, Syria, Iran, Russia, Libya, and China.

These are aggressive wars against countries which have never aggressed against the United States. They are not, at all, defensive, but the exact opposite. It’s not necessarily endless war (even Hitler hadn’t planned that), but war until the entire planet has come under the control of the U.S. Government, a government that is itself controlled by America’s billionaires, the funders of neoconservatism and imperialism — in both major American political parties, think tanks, newspapers, TV networks, etcetera.

Bezos has been a crucial part of neoconservatism, ever since, at the June 6-9 2013 Bilderberg meeting, he arranged with Donald Graham, the Washington Post’s owner, to buy that newspaper, for $250 million. Bezos had already negotiated, in March of that same year, with the neoconservative CIA Director, John Brennan, for a  $600 million ten-year cloud computing contract that transformed Amazon corporation, from being a reliable money-loser, into a reliably profitable firm.

That caused Bezos’s net worth to soar even more (and at a sharper rate of rising) than it had been doing while it had been losing money. He became the most influential salesman not only for books, but for the CIA, and for such mega-corporations as Lockheed Martin. Imperialism has supercharged his wealth, but it didn’t alone cause it. Bezos might be the most ferociously gifted business-person on the planet.

Some of America’s billionaires don’t care about international conquest as much as he does, but all of them at least accept neoconservatism; none of them, for example, establishes and donates large sums to, anti-imperialistic organizations; none of America’s billionaires is determined to end the reign of neoconservatism, nor even to help the fight to end it, or at least to end its grip over the U.S. government. None. Not even a single one of them does.

Plutocrat Bezos at the Pentagon with then Defense Secretary Ash Carter, May 2016. (Wikimedia Commons)

But many of them establish and donate large sums to neoconservative organizations, or run neocon organs such as The Washington Post.  That’s the way billionaires are, at least in the United States. All of them are imperialists. They sponsor it; they promote it and hire people who do, and demote or get rid of people who don’t. Expanding an empire is extremely profitable for its aristocrats, and always has been, even before the Roman Empire.

Bezos wants to privatize everything around the world that can become privatized, such as education, highways, health care, and pensions. The more that billionaires control those things, the less that everyone else does; and preventing control by the public helps to protect billionaires against democracy that would increase their taxes and government regulations that would reduce their profits by increasing their corporations’ expenses. So, billionaires control the government in order to increase their takings from the public.

With the help of the war promotion of  The Washington Post, Bezos is one of the world’s top personal sellers to the U.S. military-industrial complex. He controls and is the biggest investor in Amazon corporation, whose Web Services division supplies all cloud-computing services to the Pentagon, CIA and NSA. (He’s leading the charge in the most advanced facial recognition technology too.)

In April there was a headline, “CIA Considering Cloud Contract Worth ‘Tens of Billions’,” which contract could soar Bezos’s personal wealth even higher into the stratosphere, especially if he wins all of it (as he previously did).

He also globally dominates, and is constantly increasing his control over the promotion and sale of books and films, because his Amazon is the world’s largest retailer (and now also one of the largest publishers, producers and distributors.) That, too, can have a huge impact upon politics and government, indirectly, by promoting the most neocon works helping to shape intellectual discourse (and voters’ votes) in the country.

Bezos is crushing millions of retailers by his unmatched brilliance at controlling one market after another as Amazon or as an essential middleman for — and often even a controller of — Amazon’s retail competitors.

He is a strong believer in “the free market”, which he has mastered perhaps better than anyone. This means that Bezos supports the unencumbered ability of billionaires, by means of their money, to control and eventually absorb all who are less powerful than they.

Because he is so enormously gifted himself at amassing wealth, he has thus-far been able to rise to the global top, as being one of the world’s most powerful individuals. The wealthiest of all is King Salman— the owner of Saudi Arabia, whose Aramco (the world’s largest oil company) is, alone, worth over a trillion dollars. (Forbes and Bloomberg exclude monarchs from their wealth-rankings.)

In fact, Bloomberg is even so fraudulent about it as to have headlined on Aug. 10, “The 25 wealthiest dynasties on the planet control $1.4 trillion” and violated their tradition by including on their list one monarch, King Salman, whom they ranked at #4 as owning only $100 million, a ludicrously low ‘estimate’, which brazenly excluded not just Aramco but any of the net worth of Saudi Arabia.

Bloomberg didn’t even try to justify their wacky methodology, but merely presumed the gullibility of their readers for its acceptance. That King, therefore, is at least seven times as rich as Bezos is. He might possibly be as powerful as Bezos is. The supreme heir is lots wealthier even than the supreme self-made billionaire or “entrepreneur” is.

Certainly, both men are among the giants who bestride the world in our era. And both men are libertarians — champions of the belief that property rights (of which, billionaires have so much) are the basis of all rights, and so they believe that the wealthiest people possess the most rights of all, and that the poorest people have the least, and that all persons whose net worths are negative (having more debts than assets) possess no rights except what richer people might donate to or otherwise grant to them, out of kindness or otherwise (such as familial connections).

This — privatization of everything — is what libertarianism is: a person’s worth is his or her “net worth” — nothing else. That belief is pure libertarianism. It’s a belief that many if not most billionaires hold. Billionaires are imperialistic because they seek to maximize the freedom of the super-rich, regardless of whether this means increasing their takings from, or ultimately impoverishing, everyone who isn’t super-rich. They have a coherent ideology. It’s based on wealth. The public instead believes in myths that billionaires enable to be promulgated.

Like any billionaire, Bezos hires and retains employees and other agents who do what he/she wants them to do. This is their direct power. But billionaires also possess enormous indirect power by means of their interdependencies upon one-another, as each large corporation is contractually involved with other corporations, especially with large ones such as they; and, so, whatever power any particular billionaire possesses is actually a shared power, along with the others. (An example was the deal Bezos made with Graham.)

Collectively, they network together, even with ones they might never even have met personally, but only through their representatives, and even with their own major economic competitors. This is collective power which billionaires possess in addition to their individual power as hirers of employees and other agents.

Whereas Winston Smith, in the prophetic allegorical novel 1984, asked his superior and torturer O’Brien, “Does Big Brother exist?”

“‘Of course he exists. The Party exists. Big Brother is the embodiment of the Party.’

‘Does he exist in the same way as I exist?’

‘You do not exist,’ said O’Brien.”

This collective power is embodied by Bezos as well as any billionaire does.  A few of the others may embody it too, such as Bill Gates, Warren Buffett, Larry Ellison, Mark Zuckerberg, Charles Koch, Sergey Brin, Michael Bloomberg, George Soros,  and Jack Dorsey.  They compete against each other, and therefore have different priorities for the U.S. government; but, all of them agree much more than they disagree in regards to what the Government “should” do (especially that the U.S. military should be expanded — at taxpayer’s expense, of course, not their own).

Basically, Big Brother, in the real world is remarkably coherent and unified — far more so than the public is — and this is one of the reasons why they control Government, bypassing the public.

Here is how all of this plays out, in terms of what Bezos’s agents have been doing:

His Amazon pays low to no federal taxes because the Federal Government has written the tax-laws to encourage companies to do the types of things that Bezos has always wanted Amazon to do.

The U.S. government consequently encourages mega-corporations through taxes and regulations to crush small firms by making it harder for them to grow. That somewhat locks-in the existing aristocracy to be less self-made (as Bezos himself was, but his children won’t be).

Elected politicians overwhelmingly support this because most of their campaign funds were donated by super-rich individuals and their employees and other agents. It’s a self-reinforcing system. Super-wealth controls the government, which (along with the super-wealthy and their corporations) controls the public, which reduces economic opportunity for them. The end-result is institutionally reinforced extreme wealth-inequality, becoming more extreme all the time.

The billionaires are the real Big Brothers. And Bezos is the biggest of them all.

Our Ruling Elites Have No Idea How Much We Want to See Them All in Prison Jumpsuits

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By Charles Hugh Smith

Source: Of Two Minds

Even the most distracted, fragmented tribe of the peasantry eventually notices that they’re not in the top 1%, or the top 0.1%.

Let’s posit that America will confront a Great Crisis in the next decade. This is the presumption of The Fourth Turning, a 4-generational cycle of 80 years that correlates rather neatly with the Great Crises of the past: 1781 (Revolutionary War, constitutional crisis); 1861 (Civil War) and 1941 (World War II, global war).

What will be the next Great Crisis? Some anticipate another great-power war, others foresee another civil war, still others reckon a military coup is likely, and some view a collapse of the economy and U.S. dollar as inevitable.

While anything’s possible, I propose a novel crisis unlike any in the past, a Moral Crisis in which the people challenge the power of the nation’s corrupt Ruling Elites: not just elected officials, but the technocrats of the Deep State, the vested interests pillaging the nation, the New Overlords of Big Tech, the financier New Nobility, the Corporate Media and the self-serving state/corporate technocrat Nomenklatura who do the dirty work of the Ruling Elites.

Divide-and-Conquer has been the absurdly easy strategy of the Ruling Elites to fragment and disempower the citizenry. It’s child’s play for the Ruling Elites to ceaselessly promote a baker’s dozen of divisive issues via the corporate media, and then watch the resulting conflicts split the citizenry into fragmented camps which subdivide further with every new toxic injection.

The one issue that could unite the fragmented citizenry is moral revulsion: As the Epstein case promises to reveal, there is literally no limit on the excesses and exploitations of the privileged few in America, no limit on what our Ruling Elites can do with absolute impunity.

The Nobility of the feudal era had some reciprocal obligation to its serfs; our New Nobility has no obligation to anyone but themselves. It is painfully obvious that there are two sets of laws in America: bankers can rip off billions and never serve time, and members of the Protected Class who sexually exploit children get a wrist-slap, if that.

Here’s the sad reality: everybody in the Ruling Elites looked the other way: all the self-described “patriots” in the Intelligence services, all the technocrats in the Departments of Justice, State, etc., the Pentagon, and on and on. Everybody with any power knows the whole class of Ruling Elites is completely corrupt, by definition: to secure power in the U.S., you have to sell your soul to the Devil, one way or the other.

Like all Ruling Elites, America’s Elites are absolutely confident in their power: this is hubris taken to new heights.

That the citizenry could finally have enough of their corrupt, self-serving Overlords does not seem in the realm of possibility to the Protected Few. There’s always a way to lawyer-up and plea-bargain for a wrist-slap, a way to bend another “patriot” (barf), a way to offer a bribe cloaked as a plum position in a philanthro-capitalist NGO (non-governmental organization), and so on.

The possibility that moral outrage could spark a revolt seems improbable in such a distracted culture, but consider the chart below: even the most distracted, fragmented tribe of the peasantry eventually notices that they’re not in the top 1%, or the top 0.1%, and that the Ruling Elites have overseen an unprecedented concentration of wealth and power into the hands of the few at the expense of the many:

Our Ruling Elites have no idea how many of us already want to see them all in prison jumpsuits, and they also have no idea how fast the moral revulsion with their corrupt “leadership” might spread. Scanning the distracted, consumerist rabble from the great heights of their wealth and power, they reckon the capacity for moral outrage is limited, leaving them safe from any domestic crusade.

They also trust that the citizenry can be further fragmented, further distracted, and so they will continue to be invulnerable. Or worst case scenario, a few especially venal villains will need to be sacrificed, and then all will return to the bliss of Neofeudal exploitation.

But they may have misread the American citizenry, just as they’ve misread history.

The Civil War Now in America

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By Eric Zuesse

Source: The Saker

America is controlled only by its wealthiest, and they are solidly in control of both political Parties. However, now that they are in control, they are fighting bitterly amongst one-another. They are on two sides. Concerning foreign policies, and domestic policies, Republican Party billionaires hate especially Iran, and especially all progressivism. By contrast, concerning foreign policies, and domestic policies, Democratic Party billionaires hate especially Russia, and accept some progressivism. (They need to do the latter so that they can be considered to be liberals and thus tolerated or even admired by Democratic Party voters. That’s necessary for them because, for example, Democratic Party voters would be just as turned off toward a politician who is financed by and fronts for the conservative Koch brothers, as Republican Party voters would be turned off toward a politician who is financed by and fronts for the liberal George Soros — and everybody knows that billionaires fund the major politicians; it’s not a totally hidden fact. Soros and other liberal billionaires can claim to be ‘public spirited’, which is necessary for them in order to be able to appeal to liberals; but the Koch brothers and other avowedly conservative billionaires have no need to make that pretense in order to appeal to conservatives.)

Actually, all  billionaires are conservatives, because they need to be that, in order to call a country like America “democratic” instead of “dictatorial,” and they need that myth of American ‘democracy’ in order to prevent a revolution, which would strip them of their power. (No American billionaire calls America a “dictatorship,” even though it is and each of them knows it, since they collectively are the dictators here, and since they don’t become involved in politics, at all, unless they want to remain in control over it. The richer a person is, the more conservative the person tends to be, and billionaires are the richest people of all, so all of them are actually conservatives. Even billionaire liberals are conservative, because otherwise the individual would be fomenting revolution, and none of them is doing any such thing — what would they be revolting against, if not themselves? They can pretend to be progressive, but only pretend. Furthermore, every study shows that the richer a person is, the more involved in politics the person tends to be. Poor people are the least involved in politics, and this is one of the reasons why the U.S. is a dictatorship. It’s a dictatorship by the richest, and throughout thousands of years that has been called an “aristocracy,” as opposed to a “democracy.”

The first scientific study of whether the U.S. is a dictatorship or a democracy was published in 2014 and it found that America is a dictatorship and that its richest are in control over it. Only wealth and political involvement determined whether a person’s desired governmental policies get passed into law and implemented by governmental policies, the researchers found. Furthermore, “The preferences of the average American appear to have only a minuscule, near-zero, statistically non-significant impact upon public policy.” Consequently, the public’s desires are actually ignored  by the American Government. It’s not responsive to what the public wants; it is responsive only  to what the politically involved super-rich — the people who mainly fund politics — want. And those billionaires also control, or even own, all of the major ’news’media, and so their propaganda filters-out such realities as that the country is a dictatorship, no democracy at all.

Barack Obama was, from the very first moment when he became President, aiming to overthrow and replace Syria’s Government, and the reason for that was never made clear, but some people thought it was because Syria is allied with Iran, and some of them thought that it was instead because Syria is allied with Russia. When the Democrat Obama negotiated and signed the multinational pact in which Iran guaranteed that it would produce no nuclear bombs and the U.S. and its allies would end their sanctions against Iran, the reality became clear that Obama didn’t actually hate Iran (which the Republican Trump clearly does). Obama was invading Syria because it’s allied with Russia, not because it’s allied with Iran. His successor, the Republican Donald Trump, is just as anti-Iran as Obama was anti-Russia. Whereas the Republican Party especially hate Iran, the Democratic Party especially hate Russia. And that’s because their billionaires do — the Democratic ones hate Russia the most, and the Republican ones hate Iran the most. That’s the biggest single difference between the two Parties.

The main personal difference between Obama and Trump (other than that Obama was intelligent and Trump isn’t) is that Obama was a much more skilled liar than Trump is. For example, he was able to string Vladimir Putin along until 2012 to hope that Obama’s ‘reset with Russia’ wasn’t merely a ploy. On 26 March 2012, Obama informed Dmitry Medvedev to tell Putin that “On all these issues, but particularly missile defense, this, this can be solved, but it’s important for him [the incoming President Putin] to give me space. This is my last election. After my election, I have more flexibility.” However, it was all a lie. The fact is that, already, Obama was actually planning, even as early as 2011, to overthrow the neutralist Government right next door to Russia, in Ukraine, and to replace it with a rabidly anti-Russian regime on Russia’s doorstep, which he was planning to bring into NATO even though only around 30% of Ukrainians wanted Ukraine to join NATO. But Putin had no way of knowing that Obama was planning this. And immediately after Obama’s February 2014 coup in Ukraine, around 60% of Ukrainians suddenly wanted Ukraine to join NATO. (That’s because the newly installed Obama regime propagandized hatred against Russia.) Obama won Ukraine as being an enemy of Russia; it’s as if Putin had wrangled a coup in Mexico and suddenly Mexicans turned rabidly hostile toward the U.S. But it was a Democrat who did this, not a Republican. And the Republican Trump is just as hostile to Iran as Obama was to Russia. These aren’t foreign governments that are interfering in America’s foreign policies; maybe Israel is doing that, and maybe Saudi Arabia is, and maybe UAE is, but certainly America’s 585 billionaires are. And they are allied with those three Middle Eastern countries. When America imposes sanctions against a country in order to wreck the target-nation’s economy, that target-nation is officially an ‘enemy’, and that’s because it is allied with or at least friendly toward either Russia, or Iran, or both. America’s 585 billionaires control America’s foreign policies, but disagree on whether America’s top enemy is (if the billionaire is a Republican) Iran, or (if the billionaire is a Democrat) Russia.

For example: If the next President is Biden, then conquering Russia will be the main foreign-policy goal, but if the next President is Trump, then conquering Iran will be.

Bezos Reveals His Ugly Vision For The World He’s Trying To Rule

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By Caitlin Johnstone

Source: CaitlinJohnstone.com

“Guess what the best planet is in this solar system?” asked Amazon CEO Jeff Bezos at a recent media event on his Blue Origin space program.

“It’s easy to know the answer to that question,” he continued. “We’ve sent robotic probes like this one to all of the planets in our solar system. Now, some of them have been fly-bys, but we’ve examined them all. Earth is the best planet. It is not close. This one is really good.”

Bezos then went on to discuss his plan to ship humans off of the best planet in the solar system and send them to live in floating cylinders in space.

Bezos claimed that the growing human population and growing energy consumption will force us to make a choice between “stasis and rationing” and “dynamism and growth”, and claimed that the latter item in his dichotomy is possible only by moving humans off the planet.

“If we’re out in the solar system, we can have a trillion humans in the solar system, which means we’d have a thousand Mozarts and a thousand Einsteins,” Bezos said. “This would be an incredible civilization. What would this future look like? Where would a trillion humans live? Well it’s very interesting, someone named Gerry O’Neill, a physics professor, looked at this question very carefully and he asked a very precise question that nobody had ever asked before, and it was, ‘Is a planetary surface the best place for humans to expand into the solar system?’ And he and his students set to work on answering that question, and they came to a very surprising–for them–counterintuitive answer: No.”

Bezos went on to describe how the limited surface areas, distance, and gravitational forces of the other planets in our solar system make settling on those planets impractical and cost-prohibitive, while constructing giant space cylinders closer to Earth which can hold a million people is far more practical. These cylinders would spin to replicate Earth’s gravitational pull with centrifugal force.

Here are some illustrations Bezos used in his presentation to show us what these “O’Neill colonies” might look like:

“These are really pleasant places to live,” Bezos said. “Some of these O’Neill colonies might choose to replicate Earth cities. They might pick historical cities and mimic them in some way. There’d be whole new types of architecture. These are ideal climates. These are short-sleeve environments. This is Maui on its best day, no rain, no storms, no earthquakes.”

No rain? No weather? Just big, spinning cylinders floating monotonously in space? A trillion divided by a million is one million, which means that the best idea the richest man in the world can come up with for the future of our species is to fill our solar system with a million of these floating homogenized space malls.

“If we build this vision, these O’Neill colonies, where does it take us? What does it mean for Earth?” Bezos asked. “Earth ends up zoned, residential, and light industry. It’ll be a beautiful place to live, it’ll be a beautiful place to visit, it’ll be a beautiful place to go to college, and to do some light industry. But heavy industry, polluting industry, all the things that are damaging our planet, those will be done off Earth. We get to have both. We get to keep this unique gem of a planet, which is completely irreplaceable–there is no Plan B. We have to save this planet. And we shouldn’t give up a future of our grandchildren’s grandchildren of dynamism and growth. We can have both.”

Now, if you look at the behavior of Jeff Bezos, who exploits his employees and destroys his competitors, and who some experts say is trying to take over the underlying infrastructure of our entire economy, you can feel reasonably confident that this man has no intention of leaving “this unique gem of a planet”, nor of having the heirs to his empire leave either. When you see this Pentagon advisory board member and CIA contractor planning to ship humans off the Earth’s surface so the planet can thrive, you may be certain that he’s talking about other humans. The unworthy ones. The ones who weren’t sociopathic enough to climb the capitalist ladder by stepping on the backs of everyone else.

And make no mistake, when Bezos talks about saving the planet for “our grandchildren’s grandchildren”, he’s not just talking about his heirs, he’s talking about himself. Bezos has invested large amounts of wealth in biotech aimed at reversing the aging process and cracking the secret of immortality.

This is the sort of guiding wisdom that is controlling the fate of our species, everyone. The world’s most ambitious plutocrat envisions a world in which, rather than evolving beyond our destructive tendencies and learning to live in collaboration with each other and our environment, we are simply shipped off into space so that he can stretch out and enjoy our beautiful planet. That’s his best idea.

Our plutocratic overlords aren’t just sociopaths. They’re morons.

Bezos’ incredibly shallow vision for humanity reminds me of something Julian Assange said at a 2017 London festival via video link about the way Silicon Valley plutocrats are trying to become immortal by finding a way to upload their brains onto computers.

“I know from our sources deep inside those Silicon Valley institutions, they genuinely believe that they are going to produce artificial intelligences that are so powerful, relatively soon, that people will have their brains digitized, uploaded on these artificial intelligences, and live forever in a simulation, therefore will have eternal life,” Assange said. “It’s a religion for atheists. They’ll have eternal life, and given that you’re in a simulation, why not program the simulation to have endless drug and sex orgy parties all around you. It’s like the 72 virgins, but it’s like the Silicon Valley equivalent.”

I mean, damn. First of all, how stupid do you have to be to overlook the fact that science has virtually no understanding of consciousness and doesn’t even really know what it is? Even if these idiots find a way to upload their neurological patternings onto some AI’s virtual simulation, it’s not like they’d be there to experience it. It would just be a bunch of data running in a computer somewhere, mimicking the personality of a dead person and experienced by no one. People who believe that all there is to them is their dopey mental patterns have not spent any time whatsoever exploring what they are, and have no idea what it is to be human. The fact that anyone would think they could become immortal by digitizing their churning, repetitive personality patterns is crazy, and the fact that they’d want to is even crazier.

People who think this way should shut up and learn about life, not rule the world in a plutocratic system where money translates directly to political influence. People who think that humans can be happily unplugged from the ecosystemic context in which they evolved, the ecosystemic context of which they are an inseparable part, and people who think they can become immortal by uploading their wanky personalities onto a computer should shut the fuck up, spend some time alone with themselves, maybe try some psilocybin mushrooms, and learn a bit about what it means to be human. They certainly shouldn’t be calling the shots.

Earth is our home. It’s what we’re made for. The earth went through a lot to give you life. Sparks had to catch, oceans had to freeze, billions of cells had to survive endless disease, all of these amazing things had to happen just right to give you life. You belong here. You are as much a creation of the earth as the air you breathe. You may feel like a singular organism but you’re actually as much a singular organism as one of the many billions of organisms that make up your body. You and earth are one. And because you evolved on earth, you are perfectly adapted to earth and it is perfectly adapted to you. It yearns for your breath as you yearn for its breeze on your face.

We absolutely have the ability to transcend our unhealthy tendencies as a species which, when you really look at them, are merely creations of a mind that feels alone and separate and like it is in a constant fight for its life. If we just put down our mental swords for a hot second and learned to channel our creativity into the thriving of our society and our ecosystem instead of into killing and out-competing one another then we will be okay. The way out of this is the way towards health. For example, once women have been given back even the most basic rights of sexual sovereignty such as birth control and access to terminations as they have in most western countries, birth rates fall below replication levels. Women’s own internal bodily wisdom makes the problem of overpopulation moot if given half a chance just to make decisions on behalf of her own body.

Another example. People lament the lack of jobs due to AI and automation but we actually desperately need people to do less. We need a whole lot of people doing nothing, not using the roads every morning and evening, not producing widgets that no one needs and creating advertising campaigns to brainwash people into buying them anyway, just to have them end up in the ocean or leaching heavy metals into the earth. Having a whole lot of people doing nothing for more of their week would take the strain off of our health systems as the single biggest factor in disease is stress. Studies show that stress also shrinks your brain and lessens your creativity and innovation too, so all the punitive-minded libertarians out there who are worried that we won’t progress as a species if we start sharing resources around to people who aren’t doing things that traditionally made money because we’ll be too relaxed can chill too. We don’t need to crack the whip to get people to make beautiful innovations. Humans are at their best when feeling playful and relaxed. Nearly all the technological advances of the past came from people who had a lot of leisure time due to their privileged status. Releasing humans from 9 to 5 slavery would be the fastest way to slow our resource consumption and take pressure off of all our systems and would have the added benefit of making us smarter, funnier, more creative and more innovative too.

And for that matter, having every idea and innovation be required to make money is also killing us. We need the ability to fund things that will not make profit. How many times have you been in a conversation and someone’s come up with an idea that will solve a major environmental, energy or health problem and no one’s got excited because it will never get off the ground because it will never make money? Fully disappearing a problem never made anyone any money. Healthy people, for example, never spend a dime at the doctors. The way out of this is detaching human innovation from money and allowing solutions to flourish without the imposition of also having to turn a profit.

These are merely three things I can think of that will dramatically improve our collective ability to reverse this extinction event and all we have to do is get saner, stop punishing each other, start sharing and start collaborating. The only issue we have as humans is that a handful of highly competitive, highly sociopathic and yet incredibly mediocre people have all the power to build our future for us with virtually no input from anyone else. Because all the power in the form of all the money has been allowed to pool into the hands of those most willing to do whatever it takes to get it, we have just a few ruthless yet surprisingly dumb individuals calling the shots on the future of all living beings. The competitive mindset that gave rise to Jeff Bezos is the exact opposite of the kind of collaborative, harmonious mindset we’ll need if we’re going to overcome the challenges we face on the horizon.