Tag Archives: Economics

Kushner-Linked Firm and Gig Economy Set to Reap Huge Profits as Mass Evictions Begin

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By Raul Diego

Source: Mint Press News

In 2014, former Blackstone and Goldman Sachs investment banker Ryan Williams got together with his “college buddy,” Joshua Kushner – Jared’s brother – to form a real estate investment platform they called Cadre. Cadre sought to disrupt the real estate industry in the wake of the 2008 subprime mortgage crisis by tinderizing property deals through a tech platform that brought investors and sellers together. According to Williams, whose other investors include George Soros and Peter Theil, Cadre’s mission is “to level the playing field in an industry that is often tilted toward the biggest players” by taking an “offline” industry online and making it “transparent.”

A pre-Covid initiative to capitalize on its platform came in the form of the so-called “opportunity zones,” that Jared Kushner directly lobbied for inclusion in Trump’s 2017 Tax Cut and Jobs Act, billed as a funding mechanism to help poor and distressed communities, which turned into a multi-billion-dollar land heist by the wealthiest Americans, like the Kushner family. The pandemic lockdown protocols forced Cadre to downsize, laying off 25 percent of its workforce in March.

But now, the company is restarting its predatory engines as the home eviction wave forming on the horizon signals potential windfalls for companies like Cadre, that are in a position to profit. It is doing so by launching a pop-up banking operation called “Cadre Cash,” which will try to lure deposits from “investors” by offering a three percent annualized “reward” to finance a new round of land-grabs as millions of Americans teeter on the edge of homelessness and landlords look to unload un-rentable properties.

Another company, Civvl, is tackling a different side of the burgeoning housing crisis in America with its on-demand service model for eviction crews. Just like Uber, the Civvl app lets “frustrated property owners and banks secure foreclosed residential properties” by connecting haulers and the rentier class.

Civvl’s parent company, OnQall, specializes in mobile app platforms that monetize side-hustles like moving, cleaning and lawn care services. The eviction crew app has, predictably, drawn a storm of criticism since Motherboard‘s article on Civvl this past Monday.

“It’s fucked up that there will be struggling working-class people who will be drawn to gigs like furniture-hauling or process-serving,” exclaimed housing activist Helena Duncan, who also pointed out the clear dystopian contours evident in a scenario where working class people are paid to wage economic warfare on fellow working class people. Civvl puts up a disingenuous defense against the earned invectives, comparing itself to Monster.com. “They’re not evicting anyone,” a Civvl spokesperson told Motherboard, “they’re just the help.”

Both Cadre and Civvl are poised to make a killing as eviction moratoriums abate across the country and millions find themselves on one side or another of evictions – tenants forced onto the streets by small landlords who will have little choice but to sell in a depressed market. Only the CDC’s national eviction moratorium, issued three weeks ago, stands in the way of the avalanche of displacement and dispossession at our doorstep. But, even the risks of fines and jail time doesn’t seem to be discouraging companies like OnQall or landlords, in general.

 

Ridiculous loopholes

Cadre, in particular, is at the head of the pack of “disruptive” real estate tech platforms mostly due to the favor it enjoys in the halls of the Trump administration. “Jared was one of the key people early on. And his contributions were critical,” says Cadre CEO Ryan Williams of Jared Kushner, whose stake is worth over $50 Million, according to 2018 SEC filings.

Despite claims that Kushner sold a “substantial portion” of his shares in the company and that the president’s son-in-law has no role in the business endeavor, recent history surrounding the so-called “opportunity zones” of Trump’s Tax bill revealed Cadre’s and Kushner’s central role in a multi-billion dollar land heist by the wealthiest Americans, like the Kushner family.

Paying lip service to the same “diversity” principles Cadre’s African American founder asserts underlie his company’s vision, the more than 200 federally-designated “opportunity zones” for disadvantaged communities that resulted from the legislation, Cadre’s machine-learning and processed census data was simply serving to make a “ridiculous loophole” available to wealthy investors to buy up land at a serious discount.

The bulk of the opportunity zone funding, some of which was set up by William’s former employer and Cadre investor, Goldman Sachs, went to high-end real estate development projects in affluent areas, retail developments and luxury hotels, such as Richard Branson’s 225-room hotel in William’s home state of Louisiana, less than two miles away from one of the poorest parts of New Orleans. The project had been announced by Branson a year before the tax-cut legislation was signed into law, but nevertheless qualified to participate in the opportunity zone program.

 

Picking up the bodies

The housing catastrophe in the United States is barley gathering steam, and while many landlords and property owners still face legal challenges in cases where eviction moratoriums remain in place, the loose patchwork of laws governing property rights across the nation – not to mention foundational ideology – gives companies like Civvl and Cadre the chance to circumvent these and rely on naked power to drive people away from their homes or convince them to sell it to massive real estate concerns, like CBRE or Kushner’s rich buddies.

Civvl is confident that they can take advantage of people’s lack of knowledge about their rights to make money as the eviction middle man. Indeed, the company is betting that municipal and federal authorities will see things their way. “This is something that has to be done,” says a company spokesman. “Listen,” he continued, “if someone is killed on the street, someone needs to go pick their body up.”

 

Related Video:

Sacrifice for Thee But None For Me

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By Charles Hugh Smith

Source: Of Two Minds

The banquet of consequences for the Fed, the elites and their armies of parasitic flunkies and factotums is being laid out, and there won’t be much choice in the seating.

Words can be debased just like currencies. Take the word sacrifice. The value of the original has been debased by trite, weepy overuse to the point of cliche. Like other manifestations of derealization and denormalization, this debasement is invisible, profound and ultimately devastating.

Consider the overworked slogan of implied shared sacrifice: we’re all in this together. Pardon my cynicism, but doesn’t this sound like what the first class passengers in the lifeboats shouted to the doomed steerage passengers on the sinking Titanic?

Here is the ice-cold reality of America in 2020: Sacrifice for Thee But None For Me. This isn’t a new trend, of course. Any measurable sacrifices shared by all the socio-economic classes ended with World War II in 1945, and since then it’s been one long slide to Sacrifice for Thee But None For Me.

We’ve seen this slide to decay and collapse many times in history. The elites who once gained social status and political power by making real sacrifices on behalf of the nation / empire become entirely self-serving, accumulating ever greater wealth and power by transferring all the sacrifices and risks onto the lower classes.

Peter Turchin, author of War and Peace and War: The Rise and Fall of Empires, describes how civic virtue is gradually replaced by personal greed and self-interest.

This excerpt perfectly captures the current zeitgeist:

“Virtus included the ability to distinguish between good and evil and to act in ways that promoted good, and especially the common good. Unlike Greeks, Romans did not stress individual prowess, as exhibited by Homeric heroes or Olympic champions. The ideal of hero was one whose courage, wisdom, and self-sacrifice saved his country in time of peril.

Unlike the selfish elites of the later periods, the aristocracy of the early Republic did not spare its blood or treasure in the service of the common interest. When 50,000 Romans, a staggering one fifth of Rome’s total manpower, perished in the battle of Cannae, as mentioned previously, the senate lost almost one third of its membership. This suggests that the senatorial aristocracy was more likely to be killed in wars than the average citizen….

The wealthy classes were also the first to volunteer extra taxes when they were needed… A graduated scale was used in which the senators paid the most, followed by the knights, and then other citizens. In addition, officers and centurions (but not common soldiers!) served without pay, saving the state 20 percent of the legion’s payroll….

The richest 1 percent of the Romans during the early Republic was only 10 to 20 times as wealthy as an average Roman citizen.”

Now compare that to the situation in Late Antiquity when

“An average Roman noble of senatorial class had property valued in the neighborhood of 20,000 Roman pounds of gold. There was no ‘middle class’ comparable to the small landholders of the third century B.C.; the huge majority of the population was made up of landless peasants working land that belonged to nobles. These peasants had hardly any property at all, but if we estimate it (very generously) at one tenth of a pound of gold, the wealth differential would be 200,000! Inequality grew both as a result of the rich getting richer (late imperial senators were 100 times wealthier than their Republican predecessors) and those of the middling wealth becoming poor.”

Compare this to the America of World War II and the America of today. Wealthy, politically influential families such as the Kennedys could only retain their influence if their sons served in positions of combat leadership, and Joe Kennedy was killed in the European theater after volunteering for a highly risky air mission. John F. Kennedy very nearly lost his life in the South Pacific.

And how do our era’s crop of presidents and presidential contenders fare by comparison? The idea that flesh and blood should ever be at risk in defense of the nation /empire–perish the thought.

As Turchin sagely observed, it’s not just the limitless greed and avoidance of sacrifice of the elite that generates destabilizing inequality–it’s the eradication of the middle class as all the risks and sacrifices were shifted from the self-serving top to the middle and lower classes.

As I’ve often noted, risk cannot be made to disappear, it can only be transferred to others. In the grand scheme of things, the inherent risks of globalization and financialization have all been transferred to the middle and working classes (however you define them). The elite class enjoys the near-infinite support of the Federal Reserve and it’s ability to print near-infinite sums of currency to bail out the greediest, most self-serving scum of parasites and speculators.

Meanwhile, all the sacrifices required to support this unfair, corrupt, predatory system have been transferred to the middle and working classes via sleight of hand. The sacrifices weren’t transparent and up front; they were cloaked in the decline of job security, in ever-higher costs, in the decline of social mobility and the erosion of the purchasing power of wages.

The elites’ economist flunkies and factotums claimed that bailing out the freeloaders, parasites and speculators would benefit “the little people” because the grand trade-off delivered by the Federal Reserve (as correspondent R.J. pointed out to me) was: no more financial panics, which caused much misery in the working class due to business failures causing layoffs and unemployment.

But globalization, financialization and the rise of cartel-state monopolies have eviscerated the middle and working classes far more effectively and permanently than any brief financial panic, while greatly enriching the elite class–a rise in wealth that is backstopped by the Federal Reserve: profits are the elites to keep while their losses are socialized, i.e. transferred to the lower classes.

Job security, the purchasing power of wages and social mobility–nothing vital to the middle or working classes is backstopped by the Fed; the Fed’s one and only job is backstopping the wealth of our parasitic, predatory elite.

Sacrifice for Thee But None For Me. The banquet of consequences for the Fed, the elites and their armies of parasitic flunkies and factotums is being laid out, and there won’t be much choice in the seating.

The Fed Has Loaned $1.2 Billion from its TALF Bailout Program to a Tiny Company with Four Employees

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By Pam Martens and Russ Martens

Source: Wall Street on Parade

Every Wall Street bailout program that the Fed has created since September 17 of last year has, according to the Fed, been ostensibly created to somehow help the average American.

According to the Fed’s Term Sheet for the Term Asset-Backed Securities Loan Facility (TALF), it’s going to “help meet the credit needs of consumers and businesses by facilitating the issuance of asset-backed securities.” Not to put too fine a point on it, but asset-backed securities and related derivatives are what blew up Wall Street in 2008, creating the worst economic downturn, at that point, since the Great Depression.

According to the Fed’s most recent H.4.1 filing, it has loaned a total $11.1 billion from TALF. Eleven percent of that money, $1.2 billion, went to a company that has 4 employees (outside of clerical workers) according to its filing with the SEC.

Read the rest of the article.

An Unprecedented 1,640 CEOs Departed in 2019; Now Execs Are Dumping Stock at Highest Pace Since 2006

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By Pam Martens and Russ Martens

Source: Wall Street on Parade

A rather fascinating picture is emerging that suggests that things were not as rosy in the U.S. economic landscape prior to the pandemic as President Donald Trump and his Director of the National Economic Council, Larry Kudlow, would have the public believe.

Challenger, Gray & Christmas, Inc. has been tracking CEO departures for the past 12 years. Its Vice President, Andrew Challenger, called the numbers for 2019 “staggering.” It was the highest number since their surveys began in 2002. A total of 1,640 CEOs headed for the exits last year. That was 156 more CEOs than those who left their post in 2008 – the year that Wall Street blazed a scorched earth trail through the U.S. economy.

The number of CEOs that did not leave on their own accord last year was 101 out of the 1,640. According to the study, 15 CEOs left over allegations of professional misconduct; 20 left amid a scandal, “typically under investigations for financial wrongdoing or other legal issues”; 24 saw their positions terminated; 39 left due to a merger or acquisition; 3 left due to bankruptcy.

CEOs of old, established companies have the clearest view of what is happening in the overall economy. They can compare sales growth to prior years and prior decades. They can spot negative or positive trends in the economy far ahead of the economic reports that the federal government releases to the public.

When an outsized number of CEOs decide to cash out their stock options, grab their golden parachutes, and flee their corner offices – something smells.

On top of that fishy smell comes a report from TrimTabs Investment Research that corporate insiders have reaped more than $50 billion in stock sales since May, putting insider selling on a pace not seen since 2006 – two years before the stock market and economic crash of 2008.

The above two reports on corporate executive behavior are compatible with Wall Street On Parade’s reports that show that the current financial crisis began in the fall of 2019 – months before the first case of COVID-19 had emerged anywhere in the world. What triggered the financial crisis? The same kind of liquidity crisis on Wall Street that ushered in the crisis of 2008. (See Wall Street’s Financial Crisis Preceded COVID-19: Chart and Timeline and our archive of more than 100 articles on the financial crisis of 2019/2020 here.)

Why does it matter when the financial crisis began? It’s critically important for the following reasons.

First, the U.S. national debt has exploded to $26.69 trillion. To wrap your mind around this explosion of the national debt, you need some historical perspective. At the beginning of the Bill Clinton Presidency in January 1993, the U.S. national debt stood at $4 trillion. At that point, the United States was more than 200 years old. During that 200 years, the U.S. had financed the Revolutionary War, the Civil War, World Wars I and II and the Vietnam War. The country had also been through the greatest economic collapse in its history, the Great Depression, which required a multitude of fiscal spending programs.

It took more than two centuries for the U.S. national debt to reach $4 trillion but in just the past 27 years the national debt has grown by more than $22 trillion – more than a five-fold increase in less than three decades.

This staggering amount of debt puts the nation at risk of a future credit downgrade and cripples its ability to adequately deal with the financial struggles of its citizens during the worst health and financial crisis in a century.

One of the key reasons for this mushrooming debt was the Wall Street financial crisis of 2008 which required massive fiscal spending to keep the economy from sinking into a depression.

But no serious steps were taken by Congress to reform Wall Street. Derivatives remain largely unregulated. Dark Pools are still trading in darkness. Wall Street continues to pay credit rating agencies to rate their toxic debt piles. Off balance sheet casinos run rampant at the largest Wall Street banks. Obscene pay for performance via stock options continues to incentive CEOs and CFOs to massage earnings.

The biggest unaddressed problem is the critical need to restore the Glass-Steagall Act. All of the dangers cited above can, and do, bring down an entire financial institution as we learned in 2008. But with the restoration of the Glass-Steagall Act, the giant, federally-insured, deposit-taking banks would be completely separated from the Wall Street casino investment banks.

This handful of mega banks that hold the majority of deposits in this country are too critical to keeping credit flowing to businesses and consumers to be run by the Wall Street bet-the-ranch mentality. These banks are simply too big to be bailed out again.

When Citigroup was disintegrating from all of the evils mentioned above from 2007 to 2010, this is what it took to resuscitate its sinking hull: $45 billion in capital infusions from the U.S. Treasury; over $300 billion in asset guarantees from the federal government; the Federal Deposit Insurance Corporation (FDIC) guaranteed $5.75 billion of its senior unsecured debt and $26 billion of its commercial paper and interbank deposits; and the Federal Reserve secretly, with no authorization or even awareness of Congress, made a cumulative $2.5 trillion in below-market rate loans to Citigroup from 2007 through at least the middle of 2010, according to an audit by the Government Accountability Office (GAO).

And, finally, acknowledging that this latest financial crisis began prior to the pandemic shines a bright light on the incompetency of the Federal Reserve to manage these Wall Street behemoth banks. It’s simply an insane regulatory model to have a bank regulator with the ability to create money out of thin air that can secretly create and spend $29 trillion bailing out the banks to cover up its own incompetency. That’s what happened from 2007 to 2010 and is in the process of happening again. (See The Fed Has Pumped $9 Trillion into Wall Street Over the Past Six Months, But Mnuchin Says “This Isn’t Like the Financial Crisis”.)

 

How big corporations are draining the life out of a sick America

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If today’s companies were truly offering a fair return to the taxpayers who built their businesses, they’d be doing a lot more to ensure that all Americans have the means to support their families.

By Paul Buchheit

Source: Nation of Change

When Dr. Jonas Salk was asked about a patent on his polio vaccine in 1955, he said, “There is no patent. Could you patent the sun?” When Gilead Sciences recently developed an anti-Covid drug for about $12 per treatment, they set the price at $3,200.

As Republicans and business leaders decry the word ‘social’ as anti-American, they continue to promote the free-market “winner take all” philosophy that has caused over half of our nation to try to survive without adequate health care and life savings and job opportunities. Our richest corporations are much to blame. A review of the facts should make this clear.

They continue to cheat on taxes

After building their businesses on 70 years of taxpayer-funded research and development, six dominant tech companies (Apple, Amazon, Google, Microsoft, Facebook, and Netflix), which together are worth over $7 trillion, have avoided over a hundred billion dollars in taxes over the past decade.

The profits of some of the largest U.S. corporations are surging in this pandemic year of sickness and death. And the levels of fraud and deceit keep growing along with the profits. A shocking analysis by the Tax Justice Network concludes that “Multinational firms operating around the world are shifting over $1 trillion in profits every year to corporate tax havens.” A trillion dollars a year, lost to the people in need of jobs and food and housing.

They’ve rigged the system

Fifty years of lobbying against their own tax responsibilities has borne fruit for the big corporations. First of all, the corporate tax rate has dropped from about 35 percent to a low of 11 percent in 2019.

Secondly, the payroll tax has been used to make up the corporate shortfall. In the past fifty years the corporate percent of tax revenue from major sources has decreased from 23 percent to 7 percent. The payroll tax percent has increased from 24 percent to 39 percent. Corporations have drastically cut their taxes while putting more of the tax burden on workers.

It gets more insidious. In the past ten years Republicans have waged an anti-IRS campaign, slashing the budget of one of the most productive and cost-effective government agencies, and eliminating the positions of highly specialized employees who might have been expected to go after the largest corporations and the biggest cheaters.

And it gets personal. According to the IRS’ own Taxpayer Advocate, the average U.S. household pays $3,000 per year to make up for the delinquents and deadbeats.

Their greed reached new heights

With the 2017 corporate tax cuts came the lofty assurances that money would be freed up for new investment in jobs and R&D. So what happened? Hypocrisy happened. In the following year S&P 500 companies set a new record for buying back their stock to artificially boost stock prices for management and investors — a practice that was illegal until the Reagan years. While about a third of S&P companies are now curtailing stock buybacks in response to the pandemic, others have depleted so much of their funds that they have turned to the pandemic-inspired CARES Act for relief to “distressed industries.”

Start with the airlines. The Big Four spent $42.5 billion on buybacks between 2014 and 2019, and now they’re asking for $50 billion in bailout money. Delta CEO Ed Bastian had the audacity to say “the owners of a business deserve a return, too.” Boeing, which was actually borrowing money to buy back stock, is now asking for a $17 billion bailout from taxpayers.

Merck, whose 1950s slogan was “Medicine is for people, not for profits,” spent $10 billion on R&D in 2018 and $14 billion on share repurchases and dividends.

At Home Depot, according to the Roosevelt Institute and the National Employment Law Project, the money spent on buybacks could have boosted the average employee’s salary by $18,000 a year.

And fast food giants including KFC, Wendy’s, and Papa John’s, who, according to the New York Times, had spent great sums of money on buybacks, now need $145 billion of taxpayer funding to avoid mass layoffs.

They show disdain for the American worker

Stock buybacks are only part of the corporate trend to diminish the state of the worker. Automation is eliminating millions of jobs. The old argument that the loss of jobs to technology has always been followed by a new and better class of work becomes meaningless when the machines start doing our thinking for us. And when the changes are occurring at such a rapid pace. A McKinsey report states: “Those earlier workforce transformations took place over many decades, allowing older workers to retire and new entrants to the workforce to transition to the growing industries. But the speed of change today is potentially faster.” The speed of change is faster still because of the loss of jobs during the Covid pandemic.

Common arguments in favor of the tech companies are that (1) they’re making a lot of people rich, and (2) they’re providing all of us with remarkable products. Well, they’re making about 20% of Americans rich. And their products are a result of 70 years of taxpayer-funded research and development, much of it by government agencies. If today’s companies were truly offering a fair return to the taxpayers who built their businesses, they’d be doing a lot more to ensure that all Americans have the means to support their families.

The Pandemic Is Accelerating Trends That Are Disrupting the Foundations of the Economy

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By Charles Hugh Smith

Source: Of Two Minds

The problem is the economy that’s left has no means of creating tens of millions of jobs to replace those lost as the 1959 economic model collapses.

Fundamentally, the economy of 2019 was not very different from the economy of 1959: people went shopping at retail stores, were educated at sprawling college campuses, went to work downtown, drove to the doctor’s office or hospital, caught a flight at the airport, and so on.

The daily routine of the vast majority of the workforce was no different from 1959. In 2019, the commutes were longer, white-collar workers stared at screens rather than typewriters, factory workers tended robots and so on, but the fundamentals of everyday life and the nature of work were pretty much the same.

Beneath the surface, the fundamental change in the economy was financialization, the commodification of everything into a financial asset or income stream that could then be leveraged, bundled and sold globally at an immense profit by Wall Street financiers.

This layer of speculative asset-income mining had no relation to the actual work being done; it existed in its own derealized realm.

For decades, these two realms—the structure of everyday life (to borrow Braudel’s apt term) and the abstract, derealized but oh so profitable realm of financialization–co-existed in an uneasy state of loosely bound systems.

If you squinted hard enough and repeated the mantras often enough, you could persuade yourself there was still some connection between the everyday-life economy and the realm of financialization.

The two realms have now disconnected, and the real-world economy has been ripped from its moorings, as patterns of work and every-day life that stretch back 70 years to the emergence of the postwar era unravel and dissolve.

The trends that are currently fatally disrupting retail, education, office work and healthcare have been in place for years. When I wrote my 2013 book about the digitized future of higher education in a low-cost union of high-touch and low-touch learning, The Nearly Free University, all these trends were already clearly visible to those willing to look beyond the models embedded in the economy for decades or even centuries.

Visionaries like Peter Drucker foresaw the complete disruption of the education and healthcare sectors as far back as 1994. Post-Capitalist Society.

The problem with this disruption is it eliminates tens of millions of jobs–not just the low-paying jobs in retail and dining-out, but high-paying jobs in university administration, healthcare, and other core service sectors.

The last real-world connection between everyday life and financialization was the over-supply of everything that could be financialized: the way to reap the big profits was expand whatever could be leveraged and sold. So retail and commercial space ballooned, colleges proliferated, cafes sprang up on every corner, etc.

Meanwhile, financialization’s unquenchable thirst for higher profits stripped everything of the redundancy and buffers required to stabilize the system in times of crisis. So hospitals no longer kept inventory because by the logic of financialization, all that mattered was maximizing the return on capital–nothing else could possibly matter in the derealized realm of speculative profiteering.

Now healthcare finds itself trapped between the pincers of financialization’s stripmining and the collapse of retail in-person demand–the financial foundation of the entire system. Under the relentless pressure of financialization’s stripmining and profteering, healthcare only survives if it can bill somebody somewhere a staggering amount for everything from office visits to procedures to hospital stays to medications.

Once that avalanche of billing dries up, the entire sector implodes: a sector that accounts for almost 20% of the U.S. economy.

Higher education is also imploding, and for the same reason: its output no longer justified its enormous cost structure. The same can be said of overbuilt retail and commercial space: the financial justification for sky-high rents have imploded and will never come back. The over-supply is so monumental and the collapse of demand so permanent, the gigantic pyramid of debt and speculative excess piled on all these excesses is collapsing.

A bailout by the Federal Reserve won’t change the fundamentals of the collapse of financialization; all the Fed can do is reserve scarce lifeboat seats for its billionaire banker-financier pals. (Warren, you know Bill, have you met Jamie, Jeff, Tim and the rest of the Zillionaire Rat-Pack?)

Despite the record highs in the stock market–the ultimate expression of financialization disconnected from the real-world economy–financialization is also imploding. Financialization still claimed a connection to the real world of income streams and the value of the collateral underlying all the speculative profiteering: the high rents paid by the restaurants on the ground floor and the businesses for office space above justified the high value of the collateral, the commercial building.

Foundational swaths of the real-world economy have been swept away, and so the collateral is largely worthless. Lots of people want their employer to start paying for business-class airline seats again so they can jet around the country on somebody else’s dime, staying in pricey hotels and attending conferences, but these activities no longer have any financial justification.

The economy of 1959 is finally expiring. The enormous time and money sinks of transporting humans hither and yon no longer have any financial justification.

The problem is the economy that’s left has no means of creating tens of millions of jobs to replace those lost as the 1959 economic model collapses. We all know that automation is replacing human labor, but the real change is the collapse of the financial justification for the enormously costly systems we now depend on to generate jobs: healthcare, retail, tourism, dining out, education, working downtown, and all the professions dependent on managing all this complexity.

While the elimination of low-skill jobs–a longstanding trend–is attracting attention, the implosion of the 1959 economic model and financialization will soon sweep away millions of high-paying professional jobs that no longer have any financial justification.

As the 1959 economy implodes, so does the tax system based on payroll taxes and property taxes. This article sketches out the perverse incentives for employers to invest in automation rather than hire workers: Covid-19 Is Dividing the American Worker (WSJ.com)

There are alternatives, but they require accepting the implosion of both the 1959 economic model and its evil offspring, financialization.

I sketched out an alternative way of organizing work, everyday life and finance in my book A Radically Beneficial World. There are alternative ways of organizing civilization other than the insanely wasteful and exploitive system we now inhabit.

How Billionaires Took Over Liberalism and Destroyed It

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By Eric Zuesse

Source: Strategic Culture Foundation

They’ve done it via the ‘news’-media — their propaganda-operations. So, this is about how billionaires do that; how they’ve done it.

Ever since at least the time of Thucydides in the 5th century BC, the wealthiest have ruled, and did it by conquest and plunder. The acquisition of exceptional wealth was by theft: it was coercion, which could be either physical against the body (violence), or mental against the mind (deception). Exceptional wealth was acquired by some form of theft. The wealthiest controlled the government, which then enforced that theft as legal “ownership.” That’s how the economy worked. The government is the ultimate authority on who owns what. None of this has changed over the millennia. However, the technologies today are different, depending less on the wielding of steely weapons, and more on the statement of stealthy words, than in the ancient past. Increasingly, control is being achieved by deceiving the public. (For example, America’s leading liberal politician, Joe Biden, was one of the U.S. Senate’s leading segregationists and back-room opponents of the NAACP, but claims to be a supporter of “civil rights”, and is thus voted for by the overwhelming majority of America’s Blacks — but America’s press hides his segregationist record, and so they don’t know about it. Those voters’ ignorance is that politician’s strength, and it all comes from America’s billionaires.) Today’s methods of deceiving (and thus controlling) the public are considerably more sophisticated and professional than in the past. The aristocracy (the billionaires) do it nowadays mainly by means of their buying and selling, and hiring and firing, of the news-media, which thus have far more importance than in ancient times, because deceit is today’s main way to control the public.

Whereas conservative media rely unashamedly upon the existing popular mythology, liberal media need to rely upon that but to pretend not to, and to be instead ‘humanitarian’ and ‘enlightened’ in a more tolerant and open-minded sense: they specialize in hypocrisy — it’s liberal aristocrats’ particular style of art-form; they’re the ‘not conservative’ type of aristocrats. They pretend to be what they aren’t (champions of democracy — which they actually despise and crave to overcome, if it exists at all).

Progressive media (to the extent they exist at all, which is only very slight, anywhere) avoid both hypocrisy and mythology: they are openly anti-aristocratic, and rejecting also any mythology — they are populist, while not affirming the popular (or any) mythology. (By contrast: conservative ‘populists’ are committed to the existing popular mythology, and can therefore be manipulated by openly conservative aristocrats — they can be “Tories,” or even “Nazis,” and they can therefore vote against their own “class interests.” It’s stupid, but conservative ‘populists’ nonetheless do it routinely.)

As a result of this (since the progressives’ appeal — rejecting both the aristocracy and the mythology — is so small), politics almost invariably pits conservatives against liberals, and therefore promotes dictatorship (rule of the nation by its aristocracy), either way.

This means that, almost invariably, it’s either the conservative aristocrats, or else the liberal aristocrats, who rule a country. (Democracy — rule by the public — is thus very rare.)

Perhaps the most famous of all liberal news-media during the Twentieth Century was Britain’s Guardian newspaper, which was anti-imperialist — and that’s a core component of progressivism, because the aristocracy derive wealth not only by exploiting their domestic public, but also (if they are internationally successful, meaning control vassal-nations) by exploiting foreign publics. These aristocrats exploit foreign publics by controlling foreign governments. That’s called “imperialism.”

The Guardian newspaper was widely considered, until recently, to be not only liberal, but even progressive. It promoted government-expenditures for the benefit of the people, instead of for international conquest (which billionaires much prefer). Consequently, the aristocracy hated it, and wanted to take it over.

Tragically, that newspaper was, in fact, taken over, culminating in 2016, by American billionaires’ ‘charities’, and promptly it became perhaps the world’s most-rabidly pro-imperialistic propaganda-sheet (even worse than America’s own Washington Post and New York Times, both of which were infamous villains, which had, for example, helped to promote George W. Bush’s lies to invade and destroy Iraq for WMD that didn’t even exist except in their own lies about the matter — and those were definitely lies, not mere errors such as the liars and their propaganda-media claimed afterward). They are constantly whipping up hatred against Russia’s Government and against any nations (like Iraq 2003, Libya 2011, Syria 2012, Ukraine 2014, and Venezuela 2015, were, and like China and Iran are now) that were friendly toward Russia — because Russia is the main country that America’s billionaires want to conquer and control that they don’t yet control. So, they constantly propagandize against Russia, where they all want “regime change” (meaning, actually, conquest).

Just as for at least the past 2,500 years, conquest is the aristocracy’s chief goal. All aristocrats support imperialism. (Any who would oppose it would no longer be accepted within the aristocracy. It would hurt them in their business-dealings with other aristocrats. Amongst their fellow aristocrats, they would be rejected.)

This journalistic transformation at the Guardian, from anti-imperialist, to becoming a champion of the Military-Industrial Complex (which is owned and controlled by the billionaires), is typical.

Understanding this transformation toward pure propaganda is helpful in order to understand the functioning of today’s most destructive Government, the U.S. Government — the country (whose Government is controlled by its billionaires — no democracy) that has perpetrated far more invasions and coups, and done far more damage in and to the world, than all other Governments in the world combined, ever since the end of World War II. It has mass-murdered tens of millions of people, not only via invasions, but by coups that were followed by U.S.-imposed brutal dictatorships (which served the U.S. aristocracy) — and all the while with the U.S. regime pretending to advance ‘democracy’ and ‘human rights’ (such as in Iraq 2003-, Libya 2011-, and Syria 2012-). (After all: it’s liberal; it is hypocritical — it pretends to be progressive but isn’t.)

Though this incredibly hypocritical global-tyrannical U.S. regime is accepted world-wide, as if it weren’t today’s equivalent of Nazi Germany (only bigger than that), it is by far the world’s most evil Government, much as Nazi Germany’s Government was, in its time. Whereas America under President FDR (who was sincerely an enemy of Nazi Germany) was largely a democracy, America is now an aristocracy of its billionaires — a dictatorship by its own super-rich (and they are vicious, comparable to what Germany’s Nazis were, though using far more-liberal rhetoric).

A typical example of today’s Guardian (which is no longer a newspaper but just an online propaganda-site funded by those billionaires’ ‘charities’, and by readers who are stupid enough to donate and pay in order to be deceived by ‘news’ they read there) is two ‘news’-reports that were published in the Guardian on the same day, and unconnected with one-another except that they were both fact-less, undocumented, and rabidly hateful against Russia’s Government — that’s to say, against the bête noire of American-and-allied (such as UK) billionaires.

On 16 July 2020, the Guardian headlined both “Russian state-sponsored hackers target Covid-19 vaccine researchers” and “UK says Russia sought to interfere in 2019 election by spreading documents online”. Both were probably lies, but certainly unverified by any clear facts — totally uninformative, and just strings of allegations, pure war-propaganda — much of it stenographically citing from official government sources in the U.S. and UK dictatorships (just like the “WMD in Iraq” lie was).

The Guardian is now a typical liberal ‘news’-medium, which means that it is at least as imperialistic as the openly conservative ‘news’-media (such as Rupert Murdoch’s Times of London) are.

To show how such propaganda is created and spread, and has been used with enormous success by the millions of hired agents (including publicly elected governmental officials) of the U.S. aristocracy, a few examples will be cited here that have already been sufficiently studied and exposed to be frauds — such as those two ‘news’-stories in the July 16th Guardian have not yet been exposed, but (based on that ‘news’-medium’s record) probably also are frauds.

On August 7th, I headlined “‘Russiagate’ Hoax Unravels, but Their Anti-Russia Sanctions Don’t,” and documented, in considerable detail, the fraudulence of the main U.S. Government hoax against Russia, a hoax that was promulgated in the Mueller Report and in all of the Democratic-Party-created “Russiagate” case against America’s current atrocious (Republican-Party-billionaire-representing) President, Donald Trump (accusing him of being ‘a puppet of Putin’).

What’s stunning there is that, with such a horrid President as Trump, the Democrats selected this hoaxed case to bring against him, in order to force him out of office — as if there weren’t authentic crimes that he had been perpetrating during his Presidency (and even before). They refused to bring any of the authentic cases against him, because they — the Democratic Party itself, its own Senators and Representatives and the Democratic National Committee — were themselves participating in those crimes (such as this and this and this and this). So, they instead brought this “Russiagate” case (which had been manufactured by the prior, Democratic Party, President’s Administration, in conjunction with MI6; and, so, Democratic Party officials could bring it), which is entirely disprovable. All of their ‘news’-media (such as the New York Times, and the Washington Post, and even the formerly British Guardian) therefore hid the hoaxiness of the charges, so as to sucker the Democratic Party’s voters (their readers) into supporting their own Democratic-Party-billionaire-serving politicians, instead of the Republican Party ones, who instead represented Republican Party billionaires. The villain was Russia (their bête noire), instead of Hillary Clinton and their own controlling aristocracy.

That “Russiagate” case in the United States was co-created by America’s CIA and Britain’s MI6; so, not only was it a real crime by the (traitorous) U.S. Government against its own American public, but it was a fictitious crime also by a foreign Government (Russia, ‘the enemy’), against the American people. And, as I have also documented, there are many such governmental crimes. And the more that they can be blamed against countries that America’s aristocracy wants to conquer (such as “Russiagate” was), the better it is for America’s aristocrats. So, this is the routine reality now (and under Trump it has increasingly been also against Iran and China), so as to pump up the Military-Industrial Complex, which is virtually owned by the aristocracy.

I document many things that are consistently denied in America’s mainstream ‘news’-media, and therefore none of those media will publish these articles (though all of my articles are submitted to all of them); but, just today as I am writing, a webmaster at a non-mainstream site objected because I provide “too many” links. Even though he operates an online news-site, he fails to know or respect the fact that ONLY online text-articles possess even the ability to enable their readers to check out easily — just by the reader’s clicking onto a link — the evidence for any reasonably questionable allegation that is being made in the given article (such as this one). Broadcast journalism doesn’t do that. Paper-and-ink journalism also doesn’t. Therefore, all of the traditional ‘news’-media don’t empower their audiences to be intelligently skeptical, and to have easy access to the actual evidence behind any reasonably questionable assertion that is being put forth by them.

Furthermore, even when traditional ‘news’-media establish online sites, any links there are often uninformative, such as to that site’s own archive of references to a given term that is being linked in their article. They assume that you trust one Party or the other, and they provide no easy means of digging deeper — because they don’t want their audience to be able to understand. Those are all billionaire-controlled ‘news’-media. So, all of them lie routinely, in order to advance the business-interests of those owners and control their audience. It’s like they are just nonstop advertisements instead of real news-media. And, since there are no links to their ultimate sources, those audiences would have to become investigators, themselves, in order to separate out which allegations are facts and which allegations are frauds. Readers don’t have the time to do that; and listeners don’t have any way in which they can do it, even if they did have the time. In other words: those audiences will choose to believe and to disbelieve whatever they want. This is the reason for the increasing political-Party polarization. It has become so bad in America now, so that the current U.S. Presidential election is between two rabidly racist contenders: the openly conservative one, Donald Trump, who hardly even tries to hide his racism, versus the other, Joe Biden, who does try to hide the fact that he was one of the U.S. Senate’s leading segregationists and was even allied on segregation-issues with the Senate’s leading segregationist, the Republican Party’s Senator Jesse Helms. Only by means of the ‘news’-media’s hiding Biden’s White-supremacist background, can they pretend that the two Parties are offering the electorate a ‘progressive’ option, in the billionaires’ 2020 Presidential (s)‘election’. Non-racist Americans are offered, by the billionaires’ two Parties, only White-supremacist options (the overtly segregationist Trump, or else the covertly segregationist Biden) to vote for to become the next President.

The entire national public then increasingly consists of people who are prejudiced in whatever ways that they are — increasingly set in their existing false beliefs — their existing myths. To allow billionaires to place their heavy thumbs upon the scales of truth and justice that they own, by means of their control over ‘news’-media, is a sure way for any democracy to degenerate into dictatorship, so that the public are fighting more against each other than against the aristocracy. This is what billionaires want and what has happened. Some things change, but others remain the same. And rule-by-the-richest seems to be in the latter category.

So: this is how one of the very few remaining progressive news-media became switched, in just the past few years, to being whored to the liberal aristocracy. The Guardian, RIP, was almost the opposite of today’s Guardian.

On August 10th, Jonathan Cook, who used to be a Guardian journalist when it was its previous, progressive newspaper, headlined “How the Guardian betrayed not only Corbyn but the last vestiges of British democracy”, and he exposed his former employer as the opposite of what it had been and as having become perhaps even the chief tool by billionaires to destroy the post-Tony-Blair Labour Party which had been led by the progressive Jeremy Corbyn, and as having reflected the Labour Party billionaires’ preference instead to defeat Corby’s Labour Party, in order to help to install as Prime Minister the far-right Tory Boris Johnson so as to restore, as being that Conservative Party’s opposition, the pro-imperialist Labour Party that had joined itself full-force to George W. Bush’s lie-based invasion of Iraq in 2003. “Racism was endemic in the language and behaviours of Labour’s senior, rightwing officials,” whom today’s Guardian had helped to make the Labour Party’s current leaders. This new Guardian was the opposite of the old Guardian, which had given a voice “for control of the Labour party so that it might really represent the poor and vulnerable against rule by the rich.” Today’s Guardian was instead instrumental in killing–off that Labour Party, and thereby leaving UK with no progressive party at all, and without even a single Party that has any actually functioning progressive wing to it, at all.

The way that billionaires took over liberalism and destroyed it is by their having taken control over non-conservative media (most of which were liberal, but a few of which were even progressive, as the Guardian used to be) and stripped out of them any opposition that those media previously had had toward imperialism, and replaced that by championing imperialism, so long it’s of the ‘right’ kind, namely sanctions and coups and invasions by ‘our’ country, against countries that never even threatened one’s own country (but that are friendly toward Russia). By definition, attempting to conquer a country that isn’t attempting to conquer that aggressor-country is the biggest of all international war-crimes; it’s “aggressive war” — and Nazi leaders were hanged for it at Nuremberg — but it’s entirely unpunished when the world’s most powerful country (and its allies) are doing it, such as now. A popular term for it (i.e., for the supreme crime that was being prosecuted at the Nuremberg Tribunals) today is “neoconservatism,” and the only way in which it differs from the Nazi Party is that America’s aggressions are aiming at different targets to destroy.

The easiest way to end democracy is to take control over the news-media so as to make them instead ‘news’-media; and, therefore, that’s the way it has been done.

If the “Market” Never Goes Down, The System Is Doomed

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By Charles Hugh Smith

Source: Of Two Minds

The reliance on “good news” narratives dooms our financial system and economy to a death spiral once reality breaks through the induced euphoria.

“Markets” that never go down aren’t markets, they’re signaling mechanisms of the Powers That Be. Markets are fundamentally clearing houses of information on price, demand, sentiment, expectations and so on–factual data on supply and demand, shipping costs, cost of credit, etc.–and reflections of trader and consumer emotions and psychology.

If markets are never allowed to go down, the information clearing house has been effectively shut down. Whatever information leaks out has been edited to fit the prevailing narrative, which in this moment is “central banks will never let markets go down ever again, so jump in and ride the guaranteed Bull to easy gains.”

The past 12 years offer ample evidence for this narrative: every dip draws a near-instantaneous monetary-policy response that reverse the dip and gooses markets higher.

That permanent monetary intervention distorts markets doesn’t matter to participants. Who cares if markets have become “markets,” simulacra of real markets that are now nothing but signaling mechanisms that all is well so buy, buy, buy? If gains are essentially guaranteed, who cares that markets are not longer information clearing houses?

Indeed. There’s no reason to care until the fatal spiral downward surprises us all. Here’s an analogy of what happens when real information gets edited to fit a convenient narrative.

Unfortunately, the patient has cancer which is starting to metastasize, i.e. spread to other organs in the body. But unbeknownst to the patient, this accurate information is considered “bad news,” so the test results and other information is carefully edited to show the cancer is actually shrinking–the exact opposite of what the actual facts reflect.

The patient is naturally delighted with this false data because it appears he’s on the mend and doesn’t need any surgery or other drastic treatments.

If participants don’t have information that reflects actual conditions, they cannot help but make disastrous decisions. Falsified or heavily edited information is misleading, and so all decisions made on the assumption this information is accurate will be fatally skewed.

Symptoms of the fatal spread of the disease are masked by stimulants that not only mask the spread but give the patient a sense of euphoric power and supreme confidence.

Imagine the patient’s terrible dismay when symptoms break through the euphoria and he learns his cancer is now terminal. Increasing the tragedy is his awareness that had the authorities in charge of his care given him the real-world data instead of the carefully edited “happy story” version, treatments could have been undertaken that might have extended his life. Now those options have been lost forever.

That’s the situation in our economy and financial system. The information cleared in markets has been suppressed, distorted and edited for 12 long years of permanent and ever-increasing monetary interventions, as the “doses” of intervention required to maintain the cocaine-like euphoria and supreme confidence in central bank manipulation of “markets” so they always signal the “good news” of guaranteed gains ratchets higher on every intrusion of reality.

The reliance on “good news” narratives dooms our financial system and economy to a death spiral once reality breaks through the induced euphoria. Our last chances to clear the financial cancers eating away at our economy are slipping away forever, masked by the “market’s” cocaine-like euphoria and supreme confidence in central-bank guaranteed gains.

If the stock market is never allowed to go down, this is the equivalent of telling the cancer-riddled patient that their cancer has disappeared, even as the disease is leading inexorably to the patient’s needless demise.