The “Phantom Legion” Problem

By Charles Hugh Smith

Source: Of Two Minds

Everything is presented as rock-solid until it falls apart.

Of the many signs of systemic decay in the late Roman Empire, one of particular relevance to our era is the Phantom Legion, military units that on paper were at full strength–and paid accordingly–but which were in reality no longer there: the paymaster collected the silver wages and recorded the unit’s roll of officers and soldiers, but it was all make-believe.

When the Empire’s wealth seems limitless, graft, embezzlement and fraud all seem harmless to those skimming the wealth. Look, the Empire is forever, what harm is there in my little self-interested skim?

This rot starts at the top, of course, and then seeps into every nook and cranny of the system. When those at the top are getting fabulously wealthy on modest salaries while claiming to serve the public, the signal is clear: go ahead and maximize your own private gain at the expense of the public and the state. Civic virtue–the backbone of the Empire–decayed into self-interest, incompetence and indulgence.

The “Phantom Legion” Problem has another wrinkle: the legion is reported at full strength, but the actual number of soldiers is far lower than the reported number, and the competence of the officers is so low that the legion is incapable of performing its duties. In other words, the numbers don’t reflect the actual utility-value of the legion as a combat unit: the soldiers may be ill-trained, ill-equipped and poorly fed, and the officers inexperienced, corrupt or just waiting for their term of duty to end.

In the present day, this is how The Phantom Legion Problem manifests: the agency / institution is reported at full strength and fully capable of performing all its duties, but beneath the surface it’s lacking experienced staff and competent leadership, and much of the staffing is in unproductive, dead-wood administrative positions.

Taking healthcare as an example, we find experienced frontline caregivers are retiring and not being replaced with equivalent numbers of staff with the equivalent experience. We find caregivers are burning out due to crushing workloads, or quitting the profession in order to have a family and get their life back.

Meanwhile, the number of administrators increases, soaking up the system’s funding with endlessly expanding compliance data entry, reports, etc., all of which adds additional burdens on those actually providing care.

There’s always enough money to increase administrators’ salaries, but not enough to maintain essential systems or hire more caregivers.

The Phantom Legion Problem plays out in many ways in modern bureaucracies. The number of sworn officers in a police department may appear adequate but if many are assigned to desks, the PD is not actually at full strength.

If administrators are advanced due to their PR and financial skills rather than on their competence in actually leading the organization, the Phantom Legion problem is already terminal. the rot starts at the top, and those actually carrying the weight fulfilling the organization’s mission burn out, get disgusted and give up.

The problem with The Phantom Legion Problem is there is every incentive to hide the decay of systemic competence and capability behind glowing annual reports and ginned-up numbers. Only those within the organization know the truth and they are under pressure to keep quiet, lest they find themselves on the slow train to Siberia.

Here is how systems decay and collapse: everything is reported at full strength, but the numbers don’t reflect reality. Everything is presented as rock-solid until it falls apart. Everyone outside the system is in disbelief while insiders wondered how it held together as long as it did.

FTX & the Joke of US Democracy

From its founding in 2017, the one-man company rose to a “partner organisation” of the WEF and second largest donor to Biden and the Democrats’ mid-term election. It has now gone bust.

Sam Bankman-Fried during the Bitcoin 2021 conference. (Cointelegraph, CC BY 3.0, Wikimedia Commons)

By Craig Murray

Source: Consortium News

NOTE: This is is what I think of as a signpost article — it points you to something the mainstream media is deliberately not giving the prominence it needs, but I have no personal expertise or inside knowledge to give you. I am just giving you a start to get going. Several readers will have a much better understanding than I, and I encourage you to give your thoughts in comments below.

The FTX story seems truly remarkable. From being founded only in 2017 it rose to be a “partner organisation” of the World Economic Forum and the second largest donor to U.S. President Joe Biden and the Democrats’ mid-term election campaign. It has now gone completely bust, taking every penny of its depositors’ money with it.

That is some trajectory.

The World Economic Forum has deleted its FTX page, but the Wayback machine has it:

I suppose it is inevitable that dodgy chancers would create derivatives markets for gambling on crypto, but I confess I had not given the matter much thought. It goes without saying that in those five years the founder of FTX had managed to take a huge personal fortune out of the company before it went bust.

FTX was a one-man company belonging to Sam Bankman-Fried. The board consisted of him, an employee and the company lawyer. Over $20 billion of investors’ funds from FTX were funneled to a fund management company, Alameda Research, also owned by Sam Bankman-Fried.

Bankman-Fried donated $37 million to the Democrats for the 2022 elections. Every penny of that originated with duped FTX investors. That is in addition to the $5 million given to the Biden 2020 campaign. FTX, of course, crashed instantly after those mid-term elections, which is interesting timing.

The BBC and The Guardian were constantly bombarding us with the term “democracy denier” in their coverage of the U.S. elections, strangely not in reference to presidential candidate Hillary Clinton’s ludicrous claims that Russian interference was the cause of her loss in 2016.

I view as a joke any notion that the U.S. is a democracy. Democracy is about giving citizens a choice of political direction. The 2022 elections saw a simply incredible expenditure on campaigning of $ 9.7 billion. Yes, nearly $10 billion. This is not democracy. It is a huge exercise in corporate control from which the ordinary citizen is frozen out.

Despite an aggressive tribalism which has stalemated the political system for decades, the difference in policy platform between Democrats and Republicans is highly marginal, with no alternative on offer to rampant and uninhibited commercial exploitation of the population by the super-wealthy.

The Democrats are marginally more keen on attacking other countries; the Republicans are marginally more against measures to curb carbon emissions. Vaunted differences on immigration and welfare turn out to be very small indeed, with very little changing when the White House does.

American elections are simply about the super-rich funneling in vast donations, expecting to benefit when their team gets its nose in the trough, or often donating to both sides to benefit either way.

I am not sure what the connection to democracy is supposed to be.

One simple fact illustrates the true nature of the bribery fest. By far the majority of the funds channeled through Political Action Committees, or PACs, are given to incumbents who face no serious threat to re-election anyway.

The PACs are interested in bribing those in power, not changing those in power. They are simply lobby groups with an opportunity for legal bribery. To illustrate that, the largest donating PACs are:

National Association of Realtors
National Beer Wholesalers Association
American Israel Public Affairs Committee
Credit Union National Association
Blue Cross/Blue Shield
American Crystal Sugar

It is worth noting that Bankman-Fried donated 10 times as much as the largest PAC donation. This brought access — he and his brother had meetings inside the White House on March 7, April 22 and May 12.

It is perhaps unsurprising therefore that FTX was involved in Ukraine, offering to exchange cryptocurrency for fiat and send it to Ukraine in an official partnership with the Ukrainian government. This from their press release

“Aid For Ukraine is cooperating with the cryptocurrency exchange FTX which converts crypto funds received into fiat and sends the donations to the National Bank of Ukraine. This marks the first-ever instance of a cryptocurrency exchange directly cooperating with a public financial entity to provide a conduit for crypto donations. Earlier this month, FTX already converted $1 million worth of SOL and transferred it to the National Bank of Ukraine.”

The collapse of the Bankman Fried scam was allegedly caused by hackers stealing what should have been a comparatively small portion of the assets of FTX, had they not been hived off elsewhere. Doubtless we will shortly hear from state salaried conspiracy theorists that this was Russia/Guccifer/an ISP address traced by Bellingcat to inside the Kremlin.
What we really have here is an Allen Stanford for 2022, with added political connections.
We would do well to heed the advice of crypto developer Nikolai Mushegian, who had as his Twitter profile: “Larpers who self-style as CEOs or CTOs or VCs are a bigger problem than the establishment. They can’t build anything and will sell you out in 2 seconds.”
His final tweet was posted on Oct. 28:

The next day he drowned in the sea off a beach in Puerto Rico, where he lived. He was fully clothed including a jacket. The police are not treating it as homicide so presumably their theory is suicide by wading out to sea.

States of course have a massive incentive to destroy non-fiat currencies, or convert them into a new category of regulation. I am interested in the current discussion on smart state digital currencies where the state can track, control and block any transaction and know in real time exactly where each citizen or entity is spending or keeping every penny.

It occurs to me this is the wrong way round. The state belongs to its citizens, not the citizens to the state. We should be able to track online every single penny of public money in real time and see how it is spent. Imagine being able to follow every penny of the billions the Tories spent on fraudulent PPE contracts, for example.

The only people whose personal currency should be able to be tracked are those who hold, or have held, positions of power in the state. Their wealth and dealings should be available in great detail to public view. As for the rest of us, our money is ours and we are entitled to privacy.

Systemic Corruption Has Destroyed America

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Source: Washington’s Blog

Preface: There’s always been some corruption in the United States … but it’s never been this bad before.

The Cop Is On the Take

Government corruption has become rampant:

  • Senior SEC employees spent up to 8 hours a day surfing porn sites instead of cracking down on financial crimes
  • NSA spies pass around homemade sexual videos and pictures they’ve collected from spying on the American people
  • Investigators from the Treasury’s Office of the Inspector General found that some of the regulator’s employees surfed erotic websites, hired prostitutes and accepted gifts from bank executives … instead of actually working to help the economy
  • The Minerals Management Service – the regulator charged with overseeing BP and other oil companies to ensure that oil spills don’t occur – was riddled with “a culture of substance abuse and promiscuity”, which included “sex with industry contacts
  • Agents for the Drug Enforcement Agency had dozens of sex parties with prostitutes hired by the drug cartels they were supposed to stop (they also received money, gifts and weapons from drug cartel members)
  • The former chief accountant for the SEC says that Bernanke and Paulson broke the law and should be prosecuted
  • The government knew about mortgage fraud a long time ago. For example, the FBI warned of an “epidemic” of mortgage fraud in 2004. However, the FBI, DOJ and other government agencies then stood down and did nothing. See this and this. For example, the Federal Reserve turned its cheek and allowed massive fraud, and the SEC has repeatedly ignored accounting fraud (a whistleblower also “gift-wrapped and delivered” the Madoff scandal to the SEC, but they refused to take action). Indeed, Alan Greenspan took the position that fraud could never happen
  • Paulson and Bernanke falsely stated that the big banks receiving Tarp money were healthy, when they were not. The Treasury Secretary also falsely told Congress that the bailouts would be used to dispose of toxic assets … but then used the money for something else entirely
  • Congress has exempted itself from the healthcare rules it insists everyone else follow
  • Law enforcement also grabs massive amounts of people’s cash, cars and property … even when people aren’t CHARGED with – let alone convicted of – any crime
  • Private prisons are huge profit-making centers for giant companies, and private prison corporations obtain quotas from the government, where the government guarantees a certain number of prisoners at any given time
  • The government covered up the health risks to New Orleans residents associated with polluted water from hurricane Katrina, and FEMA covered up the cancer risk from the toxic trailers which it provided to refugees of the hurricane.  The Centers for Disease Control – the lead agency tasked with addressing disease in America – covered up lead poisoning in children in the Washington, D.C. area (the Centers for Disease Control has also been outed as receiving industry funding)
  • In response to new studies showing the substantial dangers of genetically modified foods, the government passed legislation more or less PUSHING IT onto our plates
  • The Bush White House worked hard to smear CIA officers, bloggers and anyone else who criticized the Iraq war
  • The FBI smeared top scientists who pointed out the numerous holes in its anthrax case. Indeed, the head of the FBI’s investigation agrees that corruption was rampant
  • The government has intentionally whipped up hysteria about terrorism for cynical political purposes.  For example, former Secretary of Homeland Security Tom Ridge admitted that he was pressured to raise terror alerts to help the president win reelection
  • When the American government got caught assassinating innocent civilians, it changed its definition of “enemy combatants” to include all young men – between the ages of say 15 and 35 – who happen to be in battle zones. When it got busted killing kids with drones, it changed the definition again to include kids as “enemy combatants”
  • The government treats journalists who report on government corruption as CRIMINALS OR TERRORISTS.  And it goes to great lengths to smear them. For example, when USA Today reporters busted the Pentagon for illegally targeting Americans with propaganda, the Pentagon launched a SMEAR CAMPAIGN against the reporters

The biggest companies own the D.C. politicians. Indeed, the head of the economics department at George Mason University has pointed out that it is unfair to call politicians “prostitutes”. They are in fact pimps … selling out the American people for a price.

Government regulators have become so corrupted and “captured” by those they regulate that Americans know that the cop is on the take. Institutional corruption is killing people’s trust in our government and our institutions.

Neither the Democratic or Republican parties represent the interests of the American people.  Elections have become nothing but scripted beauty contests, with both parties ignoring the desires of their own bases.

Indeed, America is no longer a democracy or republic … it’s officially an oligarchy. And the allowance of unlimited campaign spending allows the oligarchs to purchase politicians more directly than ever.

No wonder polls show that the American people say that the system is thoroughly corrupt.

Moreover, there are two systems of justice in Americaone for the big banks and other fatcats … and one for everyone else. Indeed, Americans have .

Big Corporations Are Also Thoroughly Corrupt

But the private sector is no better … for example, the big banks have literally turned into criminal syndicates engaged in systemic fraud.

Wall Street and giant corporations are literally manipulating every single market.

And the big corporations are cutting corners to make an extra penny … wreaking havoc with their carelessness. For example:

  • U.S. military contractors have pocketed huge sums of money earmarked for humanitarian and reconstruction aid. And see this (whistleblowers alerted the government about the looting of Iraq reconstruction funds, but nothing was done)
  • There is systemic corruption among drug companies, scientific journals, university medical departments, and medical groups which set the criteria for diagnosis and treatment

(Further examples here, here, here, here and here.)

We’ve Forgotten the Lessons of History

The real problem is that we need to learn a little history:

  • We’ve known for thousands of years that – when criminals are not punished – crime spreads
  • We’ve known for centuries that powerful people – unless held to account – will get together and steal from everyone else

Beyond Partisan Politics

Liberals and conservatives tend to blame our country’s problems on different factors … but they are all connected.

The real problem is the malignant, symbiotic relationship between big corporations and big government.

 

What?!? Private prisons suing states for millions if they don’t stay full

national-occupy-day-in-support-of-prisoners-022012-by-kevin-rashid-johnson-web

By Terry Shropshire

Source: rollingout.com

The prison-industrial complex is so out of control that private prisons have the sheer audacity to order states to keep beds full or face their wrath with stiff financial penalties, according to reports. Private prisons in some states have language in their contracts that state if they fall below a certain percentage of capacity that the states must pay the private prisons millions of dollars, lest they face a lawsuit for millions more.

And guess what? The private prisons, which are holding cash-starved states hostage, are getting away with it, says advocacy group, In the Public Interest.

In the Public Interest has reviewed more than 60 contracts between private prison companies and state and local governments across the country, and found language mentioning “quotas” for prisoners in nearly two-thirds of those contracts reviewed. Those quotas can range from a mandatory occupancy of, for example, 70 percent occupancy in California to up to 100 percent in some prisons in Arizona.

It is very interesting and telling that so few major national news organization are willing to report on the monstrous, ravenous and criminal system that is devouring hundreds of thousands of black and brown boys. Even those who do not subscribe to conspiracy theories have looked askance at this shocking report.

Welcome to the greatest manifestation of modern-day slavery, ladies and gentlemen.

One of those private prisons, The Corrections Corporation of America, made an offer last year to the governors of 48 states to operate their prisons on 20-year contracts, according to In the Public Interest.

What makes these deals so odious and unscrupulous? Take a look:

1) The offer included a demand that those prisons remain 90 percent full for the duration of the operating agreement. You know what that means: if there are not enough prisoners then there will be an unspoken push for police to arrest more people and to have the courts send more to prison for petty, frivolous and nonviolent crimes. There will also be a “nudge” for judges to hand down longer or maximum sentences to satisfy this “quota.”

2) Private prison companies have also backed measures such as “three-strike” laws to maintain high prison occupancy.

3) When the crime rate drops so low that the occupancy requirements can’t be met, taxpayers are left footing the bill for unused facilities.

The report found that 41 of 62 contracts reviewed contained occupancy requirements, with the highest occupancy rates found in Arizona, Oklahoma and Virginia.

In Colorado, Democratic Gov. John Hinklooper agreed to close down five state-run prisons and instead send inmates to CCA’s three corrections facilities. That cost taxpayers at least $2 million to maintain the unused facilities.

It is getting more difficult to rationalize the societal cost of keeping prisons full just to satisfy private investors who treat prisoners as commodity and cattle .