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American State of the Union: A Festival of Lies February 1, 2014

Posted by rogerhollander in Barack Obama, Criminal Justice, Economic Crisis, Trade Agreements, War.
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Roger’s note: here are two articles from the same source, the black agenda report web site, analyses you are not likely to find in the mainstream media.

Wed, 01/29/2014 – 14:37

by BAR executive editor Glen Ford

Before the nation and the world, President Obama pledges to take “action” against “economic inequality,” while simultaneously holding secret negotiations on a Trans Pacific Partnership trade scheme that will quicken the pace of the global Race to the Bottom, deepening economic inequalities. “Lies of omission are even more despicable than the overt variety, because they hide.”

 

When you say ‘jobs,’ he says tax cuts – just like the Republicans, only Obama first cites the pain of the unemployed, so that you know he cares.”

“Believe it,” said the current Prevaricator-in-Chief, in the conclusion to his annual litany lies. President Obama’s specialty, honed to theatrical near-perfection over five disastrous years, is in crafting the sympathetic lie, designed to suspend disbelief among those targeted for oblivion, through displays of empathy for the victims. In contrast to the aggressive insults and bluster employed by Republican political actors, whose goal is to incite racist passions against the Other, the sympathetic Democratic liar disarms those who are about to be sacrificed by pretending to feel their pain.

Barack Obama, who has presided over the sharpest increases in economic inequality in U.S. history, adopts the persona of public advocate, reciting wrongs inflicted by unseen and unknown forces that have “deepened” the gap between the rich and the rest of us and “stalled” upward mobility. Having spent half a decade stuffing tens of trillions of dollars into the accounts of an ever shrinking gaggle of financial capitalists, Obama declares this to be “a year of action” in the opposite direction. “Believe it.” And if you do believe it, then crown him the Most Effective Liar of the young century.

Lies of omission are even more despicable than the overt variety, because they hide. The potentially most devastating Obama contribution to economic inequality is being crafted in secret by hundreds of corporate lobbyists and lawyers and their revolving-door counterparts in government. The Trans Pacific Partnership (TPP) trade deal, described as “NAFTA on steroids,” would accelerate the global Race to the Bottom that has made a wasteland of American manufacturing, plunging the working class into levels of poverty and insecurity without parallel in most people’s lifetimes, and totally eviscerating the meager gains of three generations of African Americans. Yet, the closest Obama came to even an oblique allusion to his great crime-in-the-making, was to announce that “new trade partnerships with Europe and the Asia-Pacific will help [small businesses] create even more jobs. We need to work together on tools like bipartisan trade promotion authority to protect our workers, protect our environment and open new markets to new goods stamped ‘Made in the USA.’” Like NAFTA twenty years ago – only far bigger and more diabolically destructive – TPP will have the opposite effect, destroying millions more jobs and further deepening worker insecurity. The Trans Pacific Partnership expands the legal basis for global economic inequalities – which is why the negotiations are secret, and why the treaty’s name could not be spoken in the State of the Union address. It is a lie of omission of global proportions. Give Obama his crown.

The Trans Pacific Partnership (TPP) trade deal, described as ‘NAFTA on steroids,’ would accelerate the global Race to the Bottom.”

The president who promised in his 2008 campaign to support a hike in the minimum wage to $9.50 by 2011, and then did nothing at all to make it happen, says this is the “year of action” when he’ll move heaven and earth to get a $10.10 minimum. He will start, Obama told the Congress and the nation, by issuing “an executive order requiring federal contractors to pay their federally-funded employees a fair wage of at least $10.10 an hour because if you cook our troops’ meals or wash their dishes, you should not have to live in poverty.” Obama neglected to mention that only new hires – a small fraction, beginning with zero, of the two million federal contract workers – will get the wage boost; a huge and conscious lie of omission. The fact that the president does not even propose a gradual, mandated increase for the rest of the two million shows he has no intention of using his full powers to ameliorate taxpayer-financed poverty. We can also expect Obama to issue waivers to every firm that claims a hardship, as is always his practice.

What is Obama’s jobs program? It is the same as laid out at last year’s State of the Union, and elaborated on last summer: lower business taxes and higher business subsidies. When you say “jobs,” he says tax cuts – just like the Republicans, only Obama first cites the pain of the unemployed, so that you know he cares. “Both Democrats and Republicans have argued that our tax code is riddled with wasteful, complicated loopholes that punish businesses investing here, and reward companies that keep profits abroad. Let’s flip that equation. Let’s work together to close those loopholes, end those incentives to ship jobs overseas, and lower tax rates for businesses that create jobs right here at home.” Actually, Obama wants to lower tax rates for all corporations to 28 percent, from 35 percent, as part of his ongoing quest for a Grand Bargain with Republicans. For Obama, the way to bring jobs back to the U.S. is to make American taxes and wages more “competitive” in the “global marketplace” – the Race to the Bottom.

In the final analysis, the sympathetic corporate Democrat and the arrogant corporate Republican offer only small variations on the same menu: ever increasing austerity. Obama bragged about reducing the deficit, never acknowledging that this has been accomplished on the backs of the poor, contributing mightily to economic inequality and social insecurity.

Obama offers nothing of substance, because he is not authorized by his corporate masters to do so. He takes his general orders from the same people as do the Republicans. That’s why Obama only speaks of minimum wage hikes while Republicans are in power, rather than when his own party controlled both houses of Congress. Grand Bargains are preferred, because they are the result of consensus between the two corporate parties. In effect, the Grand Bargain is the distilled political will of Wall Street, which feeds the donkey and the elephant. Wall Street – the 1 percent – believes the world is theirs for the taking, and they want all of it. Given this overarching truth, Obama has no choice but to stage a festival of lies.

BAR executive editor Glen Ford can be contacted at Glen.Ford@BlackAgendaReport.com

 

Barack Obama, the State of the Union and the Prison State

Wed, 01/29/2014 – 14:18 — Bruce A. Dixon

by BAR managing editor Bruce A. Dixon

For a generation now, predatory policing, the war on drugs and the prison state have been government’s most frequent intersection with young black Americans. The gossip before this year’s State of the Union was that the president would now do by executive order all those good things Republicans have blocked him on the last 3 years. Does that include reining in or rolling back the prison state? Should we hold our collective breath?

“…Obama campaigned in 2007 and 2008 saying he would pass legislation raising the minimum wage…”

In the days before this year’s State of the Union address, we heard a lot about how Barack Obama was finally about to unleash the mighty executive powers of his office to accomplish some of the many great things he’s always wanted to accomplish, those mostly unspecified things which evil and immoral Republicans have prevented him from doing. From long experience dating back at least to the Clinton era, the White House and Democratic party know this is an attractive picture to many, one that conveniently excuses Democrats in office from even trying to accomplish the real demands of the millions who vote them into office.

Barack Obama campaigned in 2007 and 2008 saying he would pass legislation raising the minimum wage and making it easier to organize unions so people could stand up for their own rights in the workplace. The president apparently lied. Once in office with a thumping majority in both houses of Congress the president promptly froze the wages of federal workers, and made no move to protect union organizing or to raise the minimum wage. Four and five years later, with the House of Representatives safely under Republican control, the president has begun to make noises about how “America deserves a raise” and has finally declared that federal contract workers will soon have to be paid a minimum of $10.10 per hour.

Although Barack Obama’s career, and those of the entire black political class are founded on the notion that they and the Democratic party somehow “represent” the aspirations and political power of African Americans, the policy concerns of black America were nowhere to be found in last night’s state of the union. The speech contained no mention of the persistent gap between black and white unemployment, or the widening gaps between black and white wealth, and reaffirmed his commitment to “Race To The Top” an initiative to privatize public education in poorer communities across the country.

” Obama could halt the construction and opening of the new federal supermax prison…”

And of course, no cluster of issues impact black America more savagely and disproportionately than police practices, the drug war and the prison state. African Americans are one eighth the US population, but more than 40% of its prisons and jails. Together with Latinos, who are another eighth and make up nearly 30% of US prisoners, people of color are a quarter of the US population and more than 70% of the locked down. No cluster of issues would benefit more from a few presidential initiatives and well placed strokes of the pen than police practices, the drug war and the prison state.

Here are just a handful of things President Obama and his party could and would do, things that Republicans are powerless to prevent, which would make a large and lasting impact upon the communities they purportedly represent.

With the stroke of a presidential pen, Barack Obama could halt the construction and opening of the new federal supermax prison at ADX Thomson in Illinois, also called “Gitmo North.” Citizen activists in the president’s home state last year managed to close down the state’s brutal supermax prison at Tammsbecause they know that supermax prisons do not rehabilitate, they are instruments of torture pure and simple. Ordinary citizens know that torture should not be a career, or a business governments engage in. Even Obama’s own Bureau of Prisons is on record as wanting to examine whether the regimes in supermax prisons across the country constitute torture. It’s time to look for that presidential pen.

The president could take public notice of the alarming militarization of police forces across the country and the wave of police shootings of civilians. Far more persons die in the US of police gunfire than of terrorist incidents and school shootings. The feds play an enormous role in the funding, training and arming of thousands of local police departments across the country, through its grants to the state-level training and certification agencies, and its authorization of the sale of military equipment to police departments. The result is that every county and town in the US now has a SWAT team, employing shoot-first-question-later tactics, and although African Americans are far from the only victims of unchecked police violence, a black person is killed by police, security officers or vigilantes once every 28 hours. Again, this is a case for a presidential statement, a few orders to underlings and that mighty executive pen.

The president could order his Justice Department to reconsider its objections to the retroactive reduction of unfair and disproportionate sentences to crack cocaine defendants. When the president signed the so-called Fair Sentencing Act reducing the crack to powder cocaine penalty ratio from 100 to 1 to 18 to 1 thousands of defendants should have been eligible for immediate release. But Obama’s and Eric Holder’s Justice Departments have gone to court repeatedly to keep them behind bars. Our civil rights establishment from the Mark Morials and Al Sharptons down, seem more invested in the prestige of the president than doing justice to prisoners, and so have politely refused to call Obama and Holder on this glaring disconnect between their public pronouncements and their actual policies. The mighty presidential pen in the hands of Barack Obama could have made a big difference here any time in the last several years, and still can, if only he will.

The president could use his mighty executive powers to release some long-time political prisoners. There’s Iman Jamil Al-Amin, the former H. Rap Brown who distinguished himself laying the foundations for what passes for black political empowerment, risking his life registering voters and conducting Freedom Schools in rural Alabama with the Student Nonviolent Coordinating Committee in the mid and early 1960s. After repeated attempts by Georgia officials in the 1990s to frame Al-Amin for shootings, one of these stuck long enough to get a shaky conviction in 1999. As pressure for a retrial from local community activists built up and even in the face of protests from establishment figures like former Atlanta mayor, congressman and ambassador Andy Young, Georgia officials transferred Al-Amin into federal custody in the dead of night, and the feds spirited him away to the hellhole at ADX Florence in Colorado where he has been for more than a decade. With a stroke of that might executive pen, President Obama could send Al-Amin back to Georgiawhere his family and attorneys could visit him, and pressure would mount on Georgia authorities to give him a new trial, in which he might well prove his innocence.

The president could pardon or grant clemency to Leonard Peltier, a Native American leader who has served a decade longer in prison than Nelson Mandela did for an offense that nobody at his trial even alleged he actually committed. Peltier is recognized around the world as a political prisoner. His continued imprisonment shows that many wounds from the 60s and 70s were never healed, and his release would demonstrate that this president acknowledges the need for this healing. After almost 40 years, Leonard Peltier surely deserves to come home.

President Obama could acknowledge the wave of hunger strikes and protests in prisons across the country, and name a commission to investigate how we can reverse the expansion of prisons, guarantee the re-absorption of former prisoners into society, and reverse the culture and law which discriminate against and punish former prisoners and their families for the rest of their lives. Right now a number of prisoners at Menard Penitentiary in the president’s home state of Illinois are waging a hunger strike, with demands that differ little from those raised by prisoners in California’s Pelican Bay last year, and those in Virginia, Georgia, Ohio and elsewhere.

We must not imagine that rolling back the carceral state is something no government on earth has ever done. Right now in Venezuela, that nation is confronting a crisis of crime, the practical limits of prison expansion, and of what kind of society they want to build. They’re taking a different path than so-called “progressives” here, who seem upset only about prisoners who are factually “innocent” and only about prisons if they’re privatized. Venezuela is frankly committed to shrinking its prison population and exploring models of restorative rather than punitive justice. There really are other ways to go, if we have the will and the vision our Democrats and Republicans lack.

Obama’s Attorney General has learned how to let the words “mass incarceration” roll off his lips fluently, after his recent discovery that such a thing actually exists. The president opined that Trayvon Martin could have been his own son, minus the status, the privilege, the neighborhood and a few other things. But that mighty presidential pen that can call commissions, impose directives, re-set priorities and make all manner of changes by executive order, changes that no evil and immoral Republicans can block or reverse, at least until they re-take the oval office, is still in that desk drawer, or wherever Barack Obama keeps it. He hasn’t found it the last five years in office. Maybe he will discover it in these last three.

Bruce A. Dixon is managing editor at Black Agenda Report and serves on the state committee of the Georgia Green Party. He lives and works in Marietta GA and can be contacted via this site’s contact page, or at bruce.dixon(at)blackagendareport.com.e pointed out repeatedly the last five years, there are boatloads of things a president anxious to serve the will of the people could do with the stroke of a pen

Signs of the Times December 20, 2013

Posted by rogerhollander in Art, Literature and Culture, Economic Crisis, Housing/Homelessness, New York.
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In the Bay Area, the homeless are suffering more than usual from a cold snap that has killed at least seven people. In New York, the homeless are suffering about as much as they always have, and they are everywhere. Seeking to tell their stories, artist Andres Serrano embarked on “Sign of the Times,” a project to buy 200 signs from homeless people at 20 bucks a shot to offer video testimony of their hard lives. When he asked, they always said yes, sometimes with a hug.

“I see every sign as a story. There are many stories out here that deserve to be heard.”

Merry Marxmas December 15, 2013

Posted by rogerhollander in Christmas, Economic Crisis, Republicans.
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Roger’s note: The Republicans make Scrooge look like a Philanthropist, and the enabling Democrats are not far behind.  Which reminds me to advise you to watch your behinds when it comes to your  Social Security and Medicare amongst other things such as food stamps, unemployment benefits, reproduction rights, health care, education grants, etc..  It is fun to mock the Republicans, which is why I pass this on to you, but of course the real villains are the Military Industrial Prison Security Bankster Complex who pull the strings for the puppets who operate our dysfunctional undemocratic so-called government (I only use the word puppets rather than whores to describe the president, congressman and judges so as not to insult those who work in the sex trade industry).

 

 

Scrooge Gets A Tax Cut

 

gty_john_boehner_obama_dm_111222_wblog

Obama and Holder Let Gangsters Pay Fine, Continue Business As Usual November 21, 2013

Posted by rogerhollander in Barack Obama, Criminal Justice, Economic Crisis.
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Roger’s note: Black Agenda Report’s Glen Ford is one of the most incisive journalists on the Internet.  Unlike the legions of mind/ethics challenged Obamabots, who for reasons of race or party loyalty are willfully blind to the Obama Administrations Wall Street/Military-Industrial Complex agenda, Black Agenda Report does not hesitate to speak the truth about the first Afro-American Emperor’s mythical new clothes.

 

 

 

 

 

Going on five years into the Obama regime, it is clear that Wall Street is immune from prosecution, no matter the savagery of the economic crime. Attorney General Eric Holder “has ruthlessly maneuvered every case against the oligarchs into his own jurisdictional arena, in order to protect the banksters from aggressive prosecution.” JP Morgan’s Jamie Dimon is a far bigger bandit than Lucky Luciano.

 

 

 

Obama and Holder Let Gangsters Pay Fine, Continue Business As Usual

 

by BAR executive editor Glen Ford

 

The Obama administration has assessed a total of $28 billion in penalties against the Dimon mob, with no discernible effect.”

 

Imagine if Charles “Lucky” Luciano and his “Commission” representing the five reigning New York Mafia families plus the Chicago mob had been immune from law enforcement meddling in their activities, from the establishment of the “Syndicate” in 1931 to the present day. By now, Luciano’s gangster heirs would be the unchallenged rulers of economic and political life in the United States and, by imperial extension, the entire capitalist world.

 

JP Morgan chief executive Jamie Dimon is the man Lucky Luciano dreamed of becoming. A friend and golfing partner of President Obama, Dimon sits at the top of the ruling financial pyramid whose “commissioners” include the heads of Bank of America, CitiGroup, Wells Fargo, Goldman Sachs and Morgan Stanley. Their syndicate owns the cops, prosecutors, judges and major political parties and is, therefore, immune from criminal prosecution: the true “Untouchables,” too big to jail. So big, it will require a revolution to dislodge them from hegemonic power.

 

The latest Obama administration “settlement” of JP Morgan’s ongoing criminal enterprise amounts to a $13 billion fine, a mere speed bump in the unbroken spree of lawlessness that “helped create a financial storm that devastated millions of Americans,” in the words of Associate Attorney General Tony West. Although it is “the largest penalty in history,” Dimon and his fellow banksters are also the richest criminals in history – the most powerful cartel of all time – who can easily afford the levy. The bursting of their housing securities bubble may have wrecked much of the global economy in 2008, but Dimon and his boys made out like pure bandits in the aftermath, consolidating their positions at the center of a dying system. JP Morgan emerged as the biggest U.S. bank in terms of assets, a gleaming tower standing amid the ruins it created. Such is the logic of late stage finance capitalism: catastrophe becomes “creative destruction,” which begets greater economic monopoly, resulting in unchallengeable political supremacy, which makes Dimon too big to jail, whether he’s actually a friend of Obama, or not.

 

Dimon and his fellow banksters can easily afford the levy.”

 

There is no reason whatsoever to believe that the $13 billion fine will have any measurable impact on JP Morgan’s business plan. So far, the Obama administration has assessed a total of $28 billion in penalties against the Dimon mob, with no discernible effect. This time around, however, Obama’s prosecutors have imposed the equivalent of mandatory community service on the corporate malefactor, as an alternative to actual justice. Part of the $4 billion set aside to help struggling homeowners will go towards knocking down abandoned or foreclosed homes in the urban neighborhoods laid waste by JP Morgan and its cohorts in the racially-targeted subprime mortgage frenzy. That’s like compelling the Mafia to do upkeep on the cemeteries where its victims are buried, in lieu of prison terms or execution.

 

Yet, Justice Department mouthpiece Tony West claims the eyesore clearance penalty will “rectify” some of the harm done to “areas hardest hit by the financial crisis.” But, of course, it doesn’t even come close. Whole communities have been wounded beyond repair. Black wealth took its deepest dive in history, with reverberations that will impact future generations. Many thousands of people have died from the social trauma inflicted by Jamie Dimon and his syndicate – and that’s just in the United States. Globally, millions have perished due to the actions for which the settlement is supposed to atone.

 

Back in the Spring, the Huffington Post noted that Attorney General Eric Holder was attempting to retract his famous admission that banks like JP Morgan are too big to jail. Holder’s original statement, in March, was:

 

“I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy. And I think that is a function of the fact that some of these institutions have become too large.”

 

Two months later, in May, Holder amended his remarks, to say:

 

“Let me make something real clear right away. I made a statement I guess in a Senate hearing that I think has been misconstrued. I said it was difficult at times to bring cases against large financial institutions because [of] the potential consequences that they would have on the financial system. But let me make it very clear that there is no bank, there’s no institution, there’s no individual who cannot be investigated and prosecuted by the United States Department of Justice…. Let me be very, very, very clear. Banks are not too big to jail. If we find a bank or a financial institution that has done something wrong, if we can prove it beyond a reasonable doubt, those cases will be brought.”

 

Clearly, Holder was lying, second time around. If there were ever a serial financial gangster, it’s Dimon. There are no better candidates for racketeering prosecution on the face of the Earth than the Big Six banks and their executives: the pinnacle of the ruling class.

 

Globally, millions have perished due to the actions for which the settlement is supposed to atone.”

 

However, it is wrong to deride Holder and Obama as merely timid in the face of Wall Street’s awesomely destructive power. Rather, they are instruments of finance capital’s hegemony. Holder has ruthlessly maneuvered every case against the oligarchs into his own jurisdictional arena, in order to protect the banksters from aggressive prosecution by wayward state officials. Holder’s “settlements” are designed to insulate the banks from the rule of law, since, at this stage of systemic decay, the Lords of Capital can no longer function within existing legal constraints. The public sphere must be privatized; the urban centers, like Detroit, must be disenfranchised; the financial cartel must be allowed to absorb an ever greater proportion of the real economy into its derivatives casino; wealth must flow from the bottom to the top, without pause; and a planetary corporate code must be established through “free trade” treaties that supersede the sovereign laws of nations. All of the Obama administration’s marching orders flow from these imperatives.

 

Obama and Holder are guardians of the emerging new order, which does not yet have a legal code – and may well prefer to forgo such niceties, entirely. In the meantime, corporate Democrats and Republicans will give lip service to the law while the Mafia of Money runs the show.

 

And, you can take that to the bank.

 

BAR executive editor Glen Ford can be contacted at Glen.Ford@BlackAgendaReport.com.

 

 

 

Largest Civil Disobedience In Walmart History Leads To More Than 50 Arrests November 8, 2013

Posted by rogerhollander in Economic Crisis, Labor.
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Roger’s note: welcome to wage slavery in capitalist America, the land of freedom.  Freedom to vote.  Freedom to watch your children starve.

 

Posted: 11/08/2013 1:04 am EST  |  Updated: 11/08/2013 2:21 am EST

Walmart arrests


Surrounded by about 100 police officers in riot gear and a helicopter circling above, more than 50 Walmart workers and supporters were arrested in downtown Los Angeles Thursday night as they sat in the street protesting what they called the retailer’s “poverty wages.”

Organizers said it was the largest single act of civil disobedience in Walmart’s 50-year history. The 54 arrestees, with about 500 protesting Walmart workers, clergy and supporters, demonstrated outside LA’s Chinatown Walmart. Those who refused police orders to clear the street after their permit expired were arrested without incident. Those who fail to post $5,000 bail would be jailed overnight, Detective Gus Villanueva, a Los Angeles Police Department spokesman, told The Huffington Post.

Their primary demand to Walmart: pay every full-time worker at least $25,000 a year.

One of the protesting Walmart workers, Anthony Goytia, a 31-year-old father of two, said he believes he will make about $12,000 this year. It’s a daily struggle, he said, “to make sure my family doesn’t go hungry.”

“The power went out at my house yesterday because I couldn’t afford the bill,” Goytia told HuffPost. “I had to run around and get two payday loans to pay for my rent from the first” of the month. “Yesterday we went to a food bank.”

To make ends meet, Goytia said he sometimes participates in clinical trials and sells his blood plasma. He has been asking his managers for full-time employment for a year and a half. Instead, he said, they hire temporary workers, who can be fired at any time.

Goytia was one of several dozen Walmart workers in Southern California who went on strike Wednesday and Thursday, calling for an end to low wages, unpredictable part-time hours and retaliation for speaking out. They were joined by other employees on their days off and dozens more who rode buses from Northern California.

The strike, protest and arrests are the latest in a series of worker actions across the country coordinated by OUR Walmart, an advocacy organization with ties to the United Food and Commercial Workers Union. The strike and protest in Los Angeles this week are the first in what organizers said would be a series of protests leading into the holiday shopping season.

The protesters said Walmart can afford to pay every worker at least $25,000 a year — pointing to Walmart’s $17 billion profit from the latest year and the founding Walton family’s fortune, which equals the wealth of the bottom 42 percent of American families.

Walmart CEO Bill Simon disclosed in a presentation recently that 475,000 Walmart workers are paid more than $25,000 a year. That leaves 525,000 to 825,000 Walmart workers earning less than $25,000. House Democrats seeking to boost the federal minimum wage from $7.25 to $10.10 per hour have criticized Walmart for its low wages.

Walmart invited HuffPost to speak to a couple associates working in the Chinatown store during the protest Thursday. In the presence of a consultant working for Walmart, two employees — Do Nguyen, 29, and Aldo Hernandez, 55 — said that they are treated well at Walmart. Nguyen, who has worked for Walmart for almost a year, said that asking for a minimum of $25,000 is “a national issue, not a Walmart issue.”

Hernandez, who has worked for Walmart for almost five years, said he gets good health benefits through Walmart and doesn’t struggle to support himself and his son. Both Nguyen and Hernandez declined to say how much they make.

Kory Lundberg, a spokesman for Walmart, said that the company has hundreds of thousands of associates who earn $25,000 or more and that others have the opportunity to do so.

“There are unparalleled opportunities at Walmart,” Lundberg said. “We’re going to be promoting 160,000 associates this year. That’s larger than the total workforce of most companies out there.”

“Folks can come in as entry level or whatever level they’re at and can work up as far as they’re willing to go,” Lundberg said. “That’s one of the things we’re proudest of.”

After working full time at Walmart in Paramount, Calif., for 10 years, Martha Sellers, 55, makes $25,400 a year. In the last few years, she said, her managers have been cutting her weekly hours, sometimes to as few as 12 hours a week.

With that income, she said, she has to pay her rent in pieces. “If I pay all my rent at one time, then I have $12 to live on and put gas in my car until I get paid again,” Sellers, who attended Thursday’s protest, said.

“I have a very nice neighbor who lends me money. But then the next month, I’m short again,” Sellers said. “I never get caught up.”

LA’s Chinatown Walmart, about one-fifth the size of the company’s regular stores, opened in September despite thousands of Angelenos protesting it during the summer. It is the retailer’s first store in central LA.

In October 2012, for the first time in Walmart’s history, some workers went on a one-day strike, even though Walmart jobs have never been protected by a labor union. More than 70 LA Walmart workers from nine stores walked off the job, followed by over 80 Walmart workers walking off the job in a dozen other U.S. cities.

Last year, through online organizing, OUR Walmart coordinated strikes on Thanksgiving and Black Friday in 46 states and 100 stores. The actions put a spotlight on the world’s largest retailer during one of the biggest shopping periods of the year. Walmart had its best Black Friday ever, according to the company.

Regarding associates being required to work earlier on Thanksgiving, Lundberg said, “Folks understand that when they come to work for Walmart, that we’re a 24-hour store, and Thanksgiving is one of those days that we serve our customers.”

Sellers went on strike on Black Friday last year and said she plans to do so again this year. “Walmart claims to be a family-oriented company,” she said. “But where’s the family time? They took away Easter too.

“Where is the American economy going if we’re all working poverty wages?,” Sellers said. “There will be no working class. We’ll all be in a poverty class.”

Sorry, Venezuela Haters: This Economy Is Not the Greece of Latin America November 7, 2013

Posted by rogerhollander in Economic Crisis, Latin America, Venezuela.
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Roger’s note: As a fact checking exercise I went to the web site of the World Bank cited at the end of this article.  On its page for Venezuela I was unable to find data to confirm the statement that poverty has dropped by 20% in the past year.  What I did find was a chart that showed that poverty as a percentage of population dropped to 25.4% in 2012 from 31.6% in 2011, which does mean a drop of 6.2%, which indeed is approximately a 20% drop for the previous year.  This is the World Bank, folks, you can’t go wrong.

 

Predicting a Venezuelan apocalypse won’t make it happen: in this oil-rich country the only thing imploding is poverty

Women queue to buy toilet paper at a supermarket in Caracas as a result of the shortage of basic goods. (Photograph: Reuters/Jorge Silva)

For more than a decade people opposed to the government of Venezuela have argued that its economy would implode. Like communists in the 1930s rooting for the final crisis of capitalism, they saw economic collapse just around the corner. How frustrating it has been for them to witness only two recessions: one directly caused by the opposition’s oil strike (December 2002-May 2003) and one brought on by the world recession (2009 and the first half of 2010). However, the government got control of the national oil company in 2003, and the whole decade’s economic performance turned out quite well, with average annual growth of real income per person of 2.7% and poverty reduced by over half, and large gains for the majority in employment, access to health care, pensions and education.

Now Venezuela is facing economic problems that are warming the cockles of the haters’ hearts. We see the bad news every day: consumer prices up 49% over the last year; a black market where the dollar fetches seven times the official rate; shortages of consumer goods from milk to toilet paper; the economy slowing; central bank reserves falling. Will those who cried wolf for so long finally see their dreams come true?

Not likely. In the opposition’s analysis Venezuela is caught in an inflation-devaluation spiral, where rising prices domestically undermine confidence in the economy and currency, causing capital flight and driving up the black market price of the dollar. This adds to inflation, as does – in their theory – money creation by the government. And its price controls, nationalisations and other interventions have caused more structural problems. Hyperinflation, rising foreign debt and a balance-of-payments crisis will mark the end of this economic experiment.

But how can a government with more than $90bn in oil revenue end up with a balance-of-payments crisis? Well, the answer is: it can’t, and won’t. In 2012 Venezuela had $93.6bn in oil revenues, and total imports in the economy were $59.3bn. The current account was in surplus to the tune of $11bn, or 2.9% of GDP. Interest payments on the public foreign debt, the most important measure of public indebtedness, were just $3.7bn. This government is not going to run out of dollars. The Bank of America’s analysis of Venezuela last month recognised this, and decided as a result that Venezuelan government bonds were a good buy.

The central bank currently holds $21.7bn in reserves, and opposition economists estimate that there is another $15bn held by other government agencies, for a total of $36.7bn. Normally, reserves that can cover three months of imports are considered sufficient; Venezuela has enough to cover at least eight months, and possibly more. And it has the capacity to borrow more internationally.

One problem is that most of the central bank’s reserves are in gold. But gold can be sold, even if it is much less liquid than assets such as US treasury securities. It seems far-fetched that the government would suffer through a balance-of-payments crisis rather than sell its gold.

Hyperinflation is also a very remote possibility. For the first two years of the economic recovery that began in June 2010, inflation was falling even as economic growth accelerated to 5.7% for 2012. In the first quarter of 2012, it reached a monthly low of just 2.9%. This shows that the Venezuelan economy – despite its problems – is very capable of providing healthy growth even while bringing down inflation.

What really drove inflation up, beginning a year ago, was a cut in the supply of dollars to the foreign exchange market. These were reduced by half in October of 2012 and practically eliminated in February. This meant more importers had to purchase increasingly expensive dollars on the black market. This is where the burst of inflation came from.

Inflation peaked at a monthly rate of 6.2% in May, then fell steadily to 3% in August as the government began to provide more dollars to the market. It jumped to 4.4% monthly in September, but the government has since increased its auctions of dollars and announced a planned increase of food and other imports, which is likely to put some downward pressure on prices.

Of course Venezuela is facing serious economic problems. But they are not the kind suffered by Greece or Spain, trapped in an arrangement in which macroeconomic policy is determined by people who have objectives that conflict with the country’s economic recovery. Venezuela has sufficient reserves and foreign exchange earnings to do whatever it wants, including driving down the black market value of the dollar and eliminating most shortages. These are problems that can be resolved relatively quickly with policy changes. Venezuela – like most economies in the world – also has long-term structural problems such as overdependence on oil, inadequate infrastructure, and limited administrative capacity. But these are not the cause of its current predicament.

Meanwhile, the poverty rate dropped by 20% in Venezuela last year – almost certainly the largest decline in poverty in the Americas for 2012, and one of the largest – if not the largest – in the world. The numbers are available on the website of the World Bank, but almost no journalists have made the arduous journey through cyberspace to find and report them. Ask them why they missed it.

Mark Weisbrot

Mark Weisbrot is Co-Director of the Center for Economic and Policy Research (CEPR), in Washington, DC. He is also president of Just Foreign Policy. He is co-author, with Dean Baker, of Social Security: The Phony Crisis. E-mail Mark: weisbrot@cepr.net

With Rise of American Fascism, Shutdown Politics ‘Predictable’ October 7, 2013

Posted by rogerhollander in Democracy, Economic Crisis, Imperialism.
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Can new progressive era rise from ashes of ‘era of obstructionism’ or is the descent of US democracy just beginning?

 

- Jon Queally, staff writer

Republican senator from Texas, Ted Cruz. (Photo: AP)

“All of this was predictable.”

In the midst of the ongoing government shutdown—with the GOP still trying their darndest to kill Obamacare and the global financial markets now truly jittery over the quite real possibility of a US default—those five words, found in Paul Krugman’s Monday New York Times column, don’t say it all, but they begin to tell a story long in the making.

If the current situation in Washington is a consternation to many observers, why so predictable to progressives and others like Krugman? He writes:

It has been obvious for years that the modern Republican Party is no longer capable of thinking seriously about policy. Whether the issue is climate change or inflation, party members believe what they want to believe, and any contrary evidence is dismissed as a hoax, the product of vast liberal conspiracies.

For a while the party was able to compartmentalize, to remain savvy and realistic about politics even as it rejected objectivity everywhere else. But this wasn’t sustainable. Sooner or later, the party’s attitude toward policy — we listen only to people who tell us what we want to hear, and attack the bearers of uncomfortable news — was bound to infect political strategy, too.

In short, when an individual—or a political party—commits to a world view fundamentally insulated from reality, it is only a matter of time before the wheels will come off the rails. Like a pathological liar, the truth finally catches up. For a gambling addict, the house will ultimately call the game.

Over the weekend, the takeaway news was that Speaker of the House Rep. John Boehner (R-OH) was either “lying” or “incompetent” when he claimed on a Sunday talk show that he didn’t have the votes to pass a “clean CR” (continuing resolution) that would end the shutdown by funding the government without GOP riders or demands. The problem, of course—as many reporters and observers documented—was that it just wasn’t factually true.

As The Hill reports:

Democrats have repeatedly called on Boehner to allow a vote on a so-called “clean” Senate bill that would reopen the government for a short period of time, but not include Republican demands to delay or defund ObamaCare.

A whip count by The Washington Post found that 20 Republican representatives supported a so-called clean continuing resolution (CR), with another four counted as “leaning yes.” If all 200 Democrats voted for the legislation, they would need just 17 Republicans to vote with them.

Boehner made the comment during an interview on ABC’s “This Week,” after host George Stephanopoulos asked him if he was “prepared to schedule a clean bill on government funding.”

When Stephanopoulos pressed Boehner on whether it was true that the votes did not exist, the Speaker said that the American people expected leaders in Washington to “sit down and have a conversation.”

So what’s at stake? According to Bloomberg on Monday, a voluntary default by the U.S. on its debt obligations would be “catastrophic” and lead to worse consequences than when the collapse of Lehman Brothers helped facilitate the financial crisis that swept the globe in 2008. The business paper reports:

Failure by the world’s largest borrower to pay its debt — unprecedented in modern history — will devastate stock markets from Brazil to Zurich, halt a $5 trillion lending mechanism for investors who rely on Treasuries, blow up borrowing costs for billions of people and companies, ravage the dollar and throw the U.S. and world economies into a recession that probably would become a depression. Among the dozens of money managers, economists, bankers, traders and former government officials interviewed for this story, few view a U.S. default as anything but a financial apocalypse.

The $12 trillion of outstanding government debt is 23 times the $517 billion Lehman owed when it filed for bankruptcy on Sept. 15, 2008. As politicians butt heads over raising the debt ceiling, executives from Berkshire Hathaway Inc.’s Warren Buffett to Goldman Sachs Group Inc.’s Lloyd C. Blankfein have warned that going over the edge would be catastrophic.

If nothing else, that’s a view of how the global capitalists see the situation. But what it also reveals is confirmation of the argument presented by many that the modern day Republican Party has become hostage to its most radical and destructive elements. Once beholden to serve the leaders of global capitalism, the new Republican Party, dominated by the branding and rhetoric of the Tea Party, has seemingly lost its ability to even know what that is.

Chris Hedges, a freelance journalist and author of the American Fascists: The Christian Right and the War on America, writes on Monday, the rise in prominence of Sen. Ted Cruz of Texas is the best example of how the ‘Christian right’ and its “anti-Enlightenment” word view has taken over the party and in its lust for power, sabotaged the country’s ability to govern itself. On the ideology of Cruz and his followers, which he terms ‘American fascism,’ Hedges writes:

They live in a binary world of black and white. They feel they are victims, surrounded by sinister groups bent on their destruction. They have anointed themselves as agents of God who alone know God’s will. They sanctify their rage. This rage lies at the center of the ideology. It leaves them sputtering inanities about Barack Obama, his corporate-sponsored health care reform bill, his alleged mandated suicide counseling or “death panels” for seniors under the bill, his supposed secret alliance with radical Muslims, and “creeping socialism.” They see the government bureaucracy as being controlled by “secular humanists” who want to destroy the family and make war against the purity of their belief system. They seek total cultural and political domination.

All ideological, theological and political debates with the radical Christian right are useless. It cares nothing for rational thought and discussion. Its adherents are using the space within the open society to destroy the open society itself. Our naive attempts to placate a movement bent on our destruction, to prove to it that we too have “values,” only strengthen its supposed legitimacy and increase our own weakness.

It is a mixture of this religious politics, combined with the financial self-interest of billionaires and ideologues—like “the Koch brothers, the political arm of the Heritage Foundation and others” described by Krugman—that fuels the current crisis. And though many step back and call the whole thing “political theater,” the final act has yet to begin.

What was “predictable,” according to Krugman, was that the GOP would ultimately end up in such a position where their aversion to facts would make them victims of reality. What is not yet clear—though predictions abound—is how the current impasse ends and what impact it will have on U.S politics leading into the 2014 election season and beyond.

With the Democratic Party also guilty in propping up a political system that fails to deliver the transformative change demanded by a world awash in war, economic inequality, and on the precipice of runaway climate change, the prospects for a new progressive era originating in Washington, DC are not only dim, but non-existent.

As Charles P. Pierce writes at Esquire on Monday morning, both parties—despite all warnings by social activists, progressives and Keynesian economists—have already agreed on austerity as a cure for the ongoing recession.

“For all the talk about how Republican extremism is finally catching up with the party,” writes Pierce, “one can argue just as well that Wall Street-friendly, deficit-hawk, DLC-onomics is finally catching up with the Democratic party.” He continues:

After all, if the shutdown ended tomorrow, the sequester would still be in place. Austerity still would be the tacitly agreed upon program for both parties, and Paul Krugman likely still would be drinking before noon. The administration’s brilliant eleventy-dimensional chess in 2010 looks more and more like a case of being too smart by half. It created a new reality in which both sides decided that what a country barely out of a devastating recession really needed was some belt-tightening and some fiscal discipline.

And Richard Eskow, from Campaign for America’s Future, writes, “The Democrats have already made too many concessions.” What’s needed, he says, is “for the people to take their government back from the extremists, before their empire collapses and takes us all down with it.”

And Eskow gets no quarrel from Hedges, who writes:

The rise of Christian fascism is aided by our complacency. The longer we fail to openly denounce and defy bankrupt liberalism, the longer we permit corporate power to plunder the nation and destroy the ecosystem, the longer we stand slack-jawed before the open gates of the city waiting meekly for the barbarians, the more we ensure their arrival.

For the moment, however, how this “impasse” ends—and what rises in its ugly wake—continues to be a guess.

_________________________________________

The NFL doesn’t pay federal taxes October 5, 2013

Posted by rogerhollander in Economic Crisis, Sports.
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ROGER’S NOTE: YOU MIGHT WANT TO GET UP FROM THE COUCH AT HALF TIME ON SUNDAY TO SIGN THIS PETITION.  ME, I PREFER WATCHING COLLEGE FOOTBALL, WHERE PURE AMATEURISM REIGNS (LOL).

 

Congress: Revoke the Tax-Exempt Status of the National Football League

By Lynda Woolard
New Orleans, Louisiana

Despite the fact that it is a $9Billion/Year industry, the National Football League (NFL) continues to enjoy status as a non-profit organization — meaning it doesn’t have to pay federal corporate taxes.

The Commissioner of the NFL, Roger Goodell, makes nearly $30 million a year — earning more than the heads of companies like Coca-Cola and Wal-Mart. Through TV deals alone, the NFL has inked nearly $30 billion with various television networks. And so often, fans like you and me are asked to foot the bill for new stadiums through our own taxes.

Yet despite being the most profitable sports league in the entire world, the NFL does not pay federal taxes.

The NFL should pay their fair share towards our economy! Just like Major League Baseball, which gave up its nonprofit status in recent years, as well as the National Basketball Association, the NFL should not be able to hide under a nonprofit status in order to avoid paying federal taxes.

The NFL has methodically worked to shift all the power to their side, leaving players, employees and PARTICULARLY THE FANS little say in what goes on with the league. We deserve a say, but do not wish to boycott our teams! Therefore, we are calling on our elected representatives to revoke the tax-exempt status we bestowed upon the league half a century ago. Please sign this petition, and let Congress know that you want them to reconsider the NFL’s tax exempt status.

Larry Summers: Goldman Sacked September 17, 2013

Posted by rogerhollander in Barack Obama, Economic Crisis.
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GregPalast.com

Larry Summers:  Goldman Sacked

By Greg Palast for Vice Magazine
Monday, 16 September 2013

Joseph Stiglitz couldn’t believe his ears.  Here they were in the White House, with President Bill Clinton asking the chiefs of the US Treasury for guidance on the life and death of America’s economy, when the Deputy Secretary of the Treasury Larry Summers turns to his boss, Secretary Robert Rubin, and says, “What would Goldman think of that?”

Huh?

Then, at another meeting, Summers said it again:  What would Goldman think?

A shocked Stiglitz, then Chairman of the President’s Council of Economic Advisors, told me he’d turned to Summers, and asked if Summers thought it appropriate to decide US economic policy based on “what Goldman thought.”  As opposed to say, the facts, or say, the needs of the American public, you know, all that stuff that we heard in Cabinet meetings on The West Wing.

Summers looked at Stiglitz like Stiglitz was some kind of naive fool who’d read too many civics books.

R.I.P. Larry Summers
On Sunday afternoon, facing a revolt by his own party’s senators, Obama dumped Larry as likely replacement for Ben Bernanke as Chairman of the Federal Reserve Board.
Until news came that Summers’ torch had been snuffed, I was going to write another column about Larry, the Typhoid Mary of Economics.  (My first, in The Guardian, 15 years ago, warned that “Summers is, in fact, a colony of aliens sent to Earth to turn humans into a cheap source of protein.”)

But the fact that Obama even tried to shove Summers down the planet’s throat tells us more about Obama than Summers—and whom Obama works for.  Hint:  You aren’t one of them.

All these Cabinet discussions back in the 1990s requiring the blessing of Goldman Sachs revolved around the Rubin-Summers idea of ending regulation of the US banking system.  To free the US economy, Summers argued, all you’d have to do is allow commercial banks to bet government-guaranteed savings on new “derivatives products,” let banks sell high-risk sub-prime mortgage securities and cut their reserves against losses.

What could possibly go wrong?
Stiglitz, who would go on to win the Nobel Prize in Economics, tried to tell them exactly what would go wrong.  But when he tried, he was replaced and exiled.
Summers did more than ask Rubin to channel the spirit of Goldman: Summers secretly called and met with Goldman’s new CEO at the time, Jon Corzine, to plan out the planet’s financial deregulation. I’m not guessing:  I have the confidential memo to Summers reminding him to call Corzine.

[For the complete story of that memo and a copy of it, read The Confidential Memo at the Heart of the Global Financial Crisis.]

Summers, as Treasury official, can call any banker he damn well pleases.  But not secretly.  And absolutely not to scheme over details of policies that could make a bank billions.  And Goldman did make billions on those plans.

Example:  Goldman and clients pocketed $4 billion on the collapse of “synthetic collateralized debt obligations”—flim-flam feathers sold to suckers and dimwits i.e. the bankers at RBS.  (See Did Fabrice Tourre Really Create The Global Financial Crisis?)

Goldman also cashed in big on the implosion of Greece’s debt via secret derivatives trades permitted by Summers’ decriminalization of such cross-border financial gaming.

The collapse of the euro-zone and the US mortgage market caused by Bankers Gone Wild was made possible only by Treasury Secretary Summers lobbying for the Commodities Futures Modernization Act which banned regulators from controlling the 100,000% increase in derivatives assets, especially super-risky “naked” credit-default swaps.

The CMFA was the financial equivalent of a fire department banning smoke alarms.

Summers took over the Treasury’s reins from Rubin who’d left to become director of a strange new financial behemoth:  The combine of Citibank with and an investment bank, Travelers. The new bank beast went bankrupt and required $50 billion in bail-out funds.  (Goldman did not require any bail-out funds–but took $10 billion anyway.)

Other banks-turned-casinos followed Citi into insolvency.  Most got bail-outs … and got Larry Summers–or, at least, Larry’s lips for “consulting” or for gold-plated speaking gigs.

Derivatives trader D.E. Shaw paid Summers $5 million for a couple of years of “part-time” work.  This added to payments from Citigroup, Goldman and other finance houses, raising the net worth of this once penurious professor to more than $31 million.

Foreclosure fills the Golden Sacks
When Summers left Treasury in 2000, The New York Times reports that a grateful Rubin got Summers the post of President of Harvard University—from which Summers was fired. He gambled away over half a billion dollars of the university’s endowment on those crazy derivatives he’d legalized.  (Given Summers’ almost pathological inability to understand finance, it was most odd that, while President of the university, he suggested that humans with vaginas aren’t very good with numbers.)

In 2009, Summers, Daddy of the Deregulation Disaster, returned to the Cabinet in triumph. Barack Obama crowned him “Economics Tsar,” allowing Summers to run the Treasury without having to be questioned by Congress in a formal confirmation hearing.

As Economics Tsar in Obama’s first term, did Summers redeem himself?

Not a chance.

In 2008, both Democrat Hillary Clinton and Republican John McCain called for using the $300 billion remaining in the “bail-out’ fund for a foreclosure-blocking program identical to the one Franklin Roosevelt had used to pull the US out of the Great Depression.  But Tsar Larry would have none of it, although banks had been given $400 billion from the same fund.

Indeed, on the advice of Summers and his wee assistant, Treasury Secretary Tim Geithner, Obama spent only $7 billon of the $300 billion available to save US homeowners.

What would Goldman think? 
As noted, Goldman and clients pocketed billions as a result of Obama’s abandonment of 3.9 million families whose homes were repossessed during his first term.  While American homeowners were drowning, Tsar Summers torpedoed their lifeboat:  a plan to prevent foreclosures by forcing banks to write-off the overcharges in predatory sub-prime mortgages.  Notably, Summers’ action (and Obama’s inaction) saved Citibank billions.

Loan Shark Larry
The deregulation disaster machinery is not done with mangling Americans.  While not-for-profit credit unions, lenders of last resort for working people and the poor in the US, have been under legal and political attack, a new kind of banking operation has bubbled out of the minds of the grifters looking for a way to make loan-sharking legit.

One new outfit, for example, called “Lending Club,” has figured out a way to collect fees for arranging loans charging as much as 29%.  Lending Club claims it cannot and should not be regulated by the Federal Reserve or other banking police.  The recent addition to its Board of Directors:  Larry Summers.

If you want to know why Obama would choose such a grifter and gamer to head the Fed, you have to ask, Who picked Obama?  Ten years ago, Barry Obama was a nothing, a State Senator from the South Side of Chicago.

But then, he got lucky.  A local bank, Superior, was shut down by regulators for mortgage shenanigans ripping off Black folk.  The bank’s Chairwoman, Penny Pritzker was so angry at regulators, she decided to eliminate them:  and that required a new President.

The billionaires connected Obama to Jamie Dimon of J.P. Morgan, but most importantly to Robert Rubin, former Treasury Secretary, but most important, former CEO of Goldman Sachs and mentor of Larry Summers.  Without Rubin’s blessing and overwhelming fundraising power, Obama would still be arguing over zoning on Halsted Street.

Rubin picked Obama and Obama picks whom Rubin picks for him.

Because, in the end, Obama knows he must choose a Fed chief based on the answer to one question:  What would Goldman think?

Special thanks to expert Lori Wallach of Public Citizen without whom our investigation could not have begun.

For the complete story of the investigation of Larry Summers, the “End Game” memo and the finance crisis, see Palast’s highly acclaimed book Vultures’ Picnic.
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signed hardbound copy and support our work with a tax-deductible contribution of $50. 

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Greg Palast is also the author of the New York Times bestsellers, Billionaires & Ballot BanditsThe Best Democracy Money Can Buy and Armed Madhouse.

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How Inequality is Killing Us September 3, 2013

Posted by rogerhollander in Economic Crisis, Health, Poverty.
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Mon, Sep 2, 2013

How Inequality is Killing Usby Susan Rosenthal

BOOK REVIEW: The Spirit Level: Why Greater Equality Makes Societies Stronger, by R. Wilkinson & K. Pickett (2009/2011)

If a book’s value can be measured by its ability to antagonize right-wing ‘think-tanks,’ then this book is priceless.

The Spirit Level challenges everything we’ve been told about why people get sick and what it takes to be healthy.

While public campaigns lecture us to eat right, stop smoking, exercise more, etc., in fact, our well-being has very little to do with our individual choices and everything to do with how society is structured. Put simply, inequality is extremely bad for our health.

The United States ranks as the world’s most unequal nation, far outstripping all other nations. The top one percent of Americans have a combined net worth that is more than triple the net worth of the other 99 percent combined. And the bottom 40 percent of Americans own less than nothing, because they are sinking in debt.(1) (See the two charts below)

The high cost of inequality

Wilkinson and Pickett compare income inequality within 23 of the world’s richest nations and all fifty US states. They found that, at every income level, people living in more unequal nations and states suffer:

• lower life expectancy

• higher infant mortality

• more homicides

• more anxiety

• more mental illness

• more drug and alcohol addiction

• more obesity

• higher rates of imprisonment

• less social mobility

• more teen pregnancies

• more high-school dropouts

• poorer school performance

• more school-age bullying

And the extent to which people at every income level suffer these problems is directly related to how unequal is the society in which they live.

In contrast, people living in more equal societies and states enjoy better mental, physical and social health – at every income level. And the more equal their societies, the more they enjoy these benefits.

Once everyone has the basic necessities of life, your health and social well-being is determined less by how rich you are than how unequal is the society in which you live. In other words, poorer people in more equal societies are healthier and happier than richer people in more unequal societies.

The difference is significant. A 1990s study of 282 metropolitan areas in the United States found that the greater the difference in income, the more the death rate rose for all income levels, not just for the poor.(2)

Researchers calculated that reducing income inequality to the lowest level found in those areas would save as many lives as would be saved by eradicating heart disease or by preventing all deaths from lung cancer, diabetes, motor vehicle crashes, HIV infection, suicide and homicide combined.

Inequality divides us

Why would inequality, in and of itself, have such a profound impact? The answer lies in our mammalian biology. As the most social animals on the planet, we are hard-wired to function best in an embracing community.

More than 95 percent of human existence has been spent in egalitarian societies. Because the survival of the group depends on collaboration, all primitive societies developed rules and customs to prevent anyone from rising too high or sinking too low.

However, for the past 10,000 years, most people have lived in class-divided, hierarchical societies. We have adapted to social inequality, but we pay a terrible price.

Consider this statement, “Most people can be trusted.” Would you agree or disagree?

The probability that you would disagree is directly related to the level of income inequality in your society. Wilkinson and Pickett show that people in the most equal nations, Scandinavia and the Netherlands, are six times more likely to trust each other than those in the most unequal nations – Portugal, Singapore and the United States. In short, inequality makes people distrustful.

When society does not take care of us, when we are abandoned to struggle individually, then we distrust others and fear for our safety. As a result, more unequal societies are characterized by more inter-personal competition, more emphasis on individual status and success, less social security, more envy of those above and more disdain for those below.

Fearful distrust compelled George Zimmerman to kill Trayvon Martin. Fearful distrust prompts us to warn our children about strangers, suspect those who are different, install security systems, view the poor and unemployed as ‘cheaters,’ applaud more spending on police and prisons, and support harsher penalties.

Fearful distrust provides a mass audience for TV shows and movies about traitors, torturers, rapists, sadists, and serial killers. When I asked one person why she followed a particularly gruesome TV serial about psychopathic murderers, she replied, “I want to know what’s out there.” Fearful distrust keeps us isolated and unable to recognize our common interests.

The Spirit Level is rich in information about the benefits of greater equality – enough to convince anyone who cares about human welfare. For that reason, I recommend it most highly. (The book’s facts, charts, and more resources can be found at The Equality Trust).

Unfortunately, the book falls short when it comes to solutions.

Could inequality be legislated away?

The book’s primary weakness is revealed in Robert Reich’s Foreword,

“By and large, ‘the market’ is generating these outlandish results. But the market is a creation of public policies. And public policies, as the authors make clear, can reorganize the market to reverse these trends.” (p.xii)

In reality, capitalism is based on a fundamental inequality: the capitalist class owns the means of production and all that is produced, so it has the power to shape society. The rest of us, who do the actual work of producing, get virtually no say in how society is run. This two-class system cannot be legislated away, any more than the systems of slavery or feudalism could be legislated away.

Most important, the capitalist system is based on the accumulation of capital which, by its very nature, increases inequality.

Every capitalist is committed to raising productivity – increasing the amount of capital that can be squeezed from each worker and confiscated by the employer. As more wealth is extracted from the working class and concentrated in the hands of the one percent, society becomes increasingly unequal. Counter-measures can slow the twin process of capital accumulation and growing inequality, but it can be stopped only by eliminating capitalism.

Could we all live in Sweden?

As Wilkinson and Pickett explain, there are two ways that countries offset rising inequality: by capping higher incomes; and by imposing higher taxes on the rich to pay for social programs. In other words, by holding the very rich down and by elevating everyone else. So it might seem that the solution to inequality could lie in redistributive public policies. However, wanting and needing such policies has never been enough – it’s always required a fight. As the authors point out,

“Sweden’s greater equality originated in the Social Democratic Party’s electoral victory in 1932 which had been preceded by violent labor disputes in which troops had opened fire on sawmill workers.” (p.242)

The book offers more examples of governments that implemented social programs for fear of revolution if they didn’t: the New Deal in the 1930s, the revolutionary wave that struck Europe in the 1840s, the post-war ‘social contract’ in England, the radicalism of the 1960s, etc.

Wilkinson and Pickett recount how income inequality in the United States reached a peak before the Great Crash of 1929. Beginning in the later 1930s, income inequality decreased as workers organized and fought to divert more social wealth to the people who produced it.

Beginning in the 1970s, income inequality began to rise again. This change was marked by an employers’ offensive against unions. As the proportion of workers in unions fell, income inequality rose until it is now similar to the level of inequality that preceded the 1929 crash.

The authors explain that the American example is not unique,

“A study which analysed trends in inequality during the 1980s and 1990s in Australia, Canada, Germany, Japan, Sweden, the United Kingdom and the United States found that the most important single factor was trade union membership…[D]eclines in trade union membership were most closely associated with widening income differences.” (p.244)

The lesson from these examples is clear: when the working class is ascendant, inequality decreases and society becomes more fair; when the capitalist class is ascendant, inequality increases and society becomes less fair.

Despite their own evidence, the authors do not call for a working-class uprising to reduce, if not eliminate, class inequality. Instead, they state that,

“The transformation of our society is a project in which we all have a shared interest.” (p.237)

This is a fundamental error, because we do not all have a shared interest. Greater equality would require the capitalist class to give up a substantial amount of its wealth and power. History shows that they never do this willingly.

Individual capitalists might see the value of a fairer society, but any who chose to slow the rate of capital accumulation would be replaced by others with no such concern. Moreover, those who accumulate the most capital can ‘buy’ as many politicians as necessary to shape public policies.

Instead of challenging the two-class capitalist system, the authors want to make it more humane by building a network of worker-co-operatives.

“The key is to map out ways in which the new society can begin to grow within and alongside the institutions it may gradually marginalise and replace. That is what making change is really about…What we need is not one big revolution but a continuous stream of small changes in a consistent direction.” (p.236)

Mondragon Corporation in Spain is offered as an example. Mondragon encompasses 120 employee-owned co-ops, 40,000 worker-owners and sales of $4.8 billion US dollars. However, despite being home to one of the world’s largest co-op networks, Spain ranks midway between the most equal and the most unequal nations. And it has recently implemented severe austerity policies that dramatically increase inequality.

Despite their many benefits, worker-owned co-operatives cannot transform society. As Rosa Luxemburg pointed out more than 100 years ago,

“Producers’ co-operatives are excluded from the most important branches of capital production — the textile, mining, metallurgical and petroleum industries, machine construction, locomotive and shipbuilding. For this reason alone, co-operatives in the field of production cannot be seriously considered as the instrument of a general social transformation…Within the framework of present society, producers’ co-operatives are limited to the role of simple annexes to consumers’ co-operatives.” (3)

And one cannot imagine the global military-industrial complex becoming a worker-owned co-op.

To their credit, the authors acknowledge,

“The truth is that modern inequality exists because democracy is excluded from the economic sphere. It needs therefore to be dealt with by an extension of democracy into the workplace.” (p.264)

Realistically, there’s only one way to achieve workplace democracy across the whole of society – a global working-class revolution that takes collective control of production and eliminates the two-class system of capitalism. Then we could build a truly cooperative society in which everyone is equally worthy to share life’s work and life’s rewards.

References

1. Wolff, E.N., “The asset price meltdown and the wealth of the middle class” National Bureau of Economic Research Working Paper 18559 (2012)

2. Lynch, J.W. et. al. (1998). Income inequality and mortality in metropolitan areas of the United States. Am J Public Health. Vol. 88, pp.1074-1080.

3. Luxemburg, R. (1900/1908). Reform or revolution. London: Bookmarks, p.66.

See also Inequality: The Root Source of Sickness

 

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