September 28, 2008

Vampire Tales! With Pictures!

I recently wrote about the behavior of vampires, here.

And now we know what our particular vampires look like.

That should give you nightmares for the next 10 or 20 years. But please remember: they're only in Washington to serve you.


A wee joke for a Sunday morning. Sunday! Glory to The One Who makes such wonders possible! (The One, and The Other One...okay, now I'm confused.)

Fucking You to Death: Blackmail, A $5 Trillion Price Tag, and A Criminal Government

You may consider my title to be unforgivably vulgar and crude. It is the truth of what the U.S. government is doing to the vast majority of the citizens it rules. To varying degrees, the government has been behaving in the identical manner for well over a century; rarely has it done so in such a blatantly dishonest and criminal manner.

I start with the point I have made in a number of posts: There Is No Fix -- not for the problem the government bailout purportedly addresses. From Mike Whitney's latest article:
Surely, the cure for hyperbolic "credit excesses and reckless behavior" cannot be "more of the same." In fact, Paulson's bailout does not even address the core issues which have been obscured by demagoguery and threats. The worthless assets must be written-down, insolvent banks must be allowed to go bust, and the crooks and criminals who engineered this financial blitz on the nation's coffers must be held to account.
But the point of this exercise is not to address the massive real problems that confront the country: rather, it is to further enrich the ruling class, to protect their existing wealth and power, and to increase their wealth and power still more. You, the "ordinary" American, will pay for all of it.

Note a few points about this Washington Post piece. First, this:
"We've made great progress, but we have to commit it to paper before we can formally agree," said House Speaker Nancy Pelosi (D-Calif.), who has pledged to make the plan available to the public for at least 24 hours before the House votes on it. A vote could come as early as tomorrow in the House, with the Senate expected to follow soon after.
How kind of Empress Nancy to permit the serfs who will make possible her latest act of gracious largesse to contemplate the details of how they will be forced to pay for this shit with their blood, labor and lives. And a whole 24 hours! Empress Nancy is generous to a fault.

Both Republicans and Democrats are desperately trying to make it appear that they're looking out for the well-being of the indentured servants whose lives their rulers so carelessly dispose of. That's hardly surprising in light of the notably loud groundswell of rejection at the terms of this plan. But it wouldn't do to encourage the riffraff too much, and the Democrats understand very well indeed who is actually calling the shots here:
Democrats also made a number of concessions, abandoning demands that bankruptcy judges be empowered to modify home mortgages on primary residences for people in foreclosure. They also agreed not to dedicate a portion of any profits from the bailout program to an affordable housing fund...
Let them live in tents! proclaim the Democrats.

But the Democrats did succeed with certain of their demands, and in every case the solution proves to be utterly meaningless and toothless:
The administration also agreed to Democratic demands that the financial services industry should help pay for the program. Under the agreement, the president would be required to propose a fee on the industry if the government has not recovered its money through sales of the assets within five years.
"The president would be required to propose..." Required to propose, but it appears no one is required to impose. Tough language! And does anyone honestly believe that after all the accounting gimmicks, the shifting of funds here, there and everywhere on the impossibly incomprehensible books of many different firms, any of this will come to anything? If you do, I have a non-existent bridge to sell you. Well, look! You bought that bridge already! Aren't you the sweetest, most agreeable idiot to ever come down the pike. Yes, you are, don't deny it now.

As the Post article makes clear, the essence of the Bush administration proposal will soon be enacted: American taxpayers will be forced to pay for generations to solve a problem that cannot be solved, all so that the ruling class is spared any substantial degree of discomfort. After this, to vote for any of the leaders of the two national parties, including the two major presidential candidates, means only one thing: you're being fucked to death -- and you're rewarding the people killing you as you beg for more. If that is your choice, I have one unsolicited piece of advice for all such voters going forward: whenever you're tempted to criticize the president or other national figures for some especially awful policy decision, shut your pathetic little traps. If you reward them once you know they're killing you, exactly how in hell do you convince yourselves that they care at all what you think, or what your concerns are?

I said all of this in a post just over a year ago:
[T]he ruling elites do not care what you think. I repeat: they do not care.

Oh, yes, they care to some extent when elections come around -- but any such concern Democratic politicians might have for certain voters' views is obliterated by one consideration loudly and repeatedly announced by almost every liberal and progressive blogger. As I've noted before (with regard to the vacuous, narcissistic bloviating of that great political thinker, Markos Moulitsas), the Washington Democrats know you will continue to vote for them no matter what they do.

When you approach the negotiating table and tell your opponent you'll give him everything he wants before you even sit down, exactly how successful do you think those negotiations will be from your perspective? Yet this is precisely what the liberal and progressive bloggers do time after time after time -- and then they profess amazement when the Democrats act in ways opposed to those same bloggers' views. And note this is not even about all voters' views, just the views of some of them. Since you'll vote for them anyway no matter what they do, why the hell should they care? Sure, you're "alienated" for the moment -- but who are you gonna vote for in November 2008, hmm? They already know the answer to that question.

The ruling class does not care about you or your views. The MoveOn denunciation is an aspect of the performance put on by one part of the ruling class for the benefit of another part. They may criticize each other in certain predetermined ways and within certain narrowly circumscribed limits -- but you may not criticize any of them in ways that go beyond what the ruling class as a whole has decided is acceptable. ... Your role -- and your only role -- is to vote for them as required, and then to shut up.
It's funny in a horrible kind of way to recall now that I received a number of emails in response to that post. Some readers (and some other bloggers) were terribly distressed. "Oh, Arthur!," they wailed. "Do you really think they don't care about us at all? They're really just in it..." and at this point, you could hear the microscopic gears in their pathetically tiny brains almost grind to a horrified halt, "they're just in it...for themselves?"

Reality has now delivered a powerful blow to the skulls of idiots of this kind. Perhaps they will take the lesson, although now I don't think it matters in the least. And of course, many of these same people will still vote for the top of the Democratic and Republican tickets. But this game is over for your lifetime. You lost. Sure, the stock market and the financial world may appear to be fine for a while -- wouldn't you, if the government had just given you a huge fortune stolen from someone else? But watch what happens in three or six months, or in a year. The devastation is far from over; in many ways, it's just beginning.

Toward the conclusion of "A Time Bereft of Heroes," written on September 20, I said:
I expect the Democrats to extract certain modifications and perhaps make a few additions to the monumentally destructive plan proposed by the Bush Administration. The final plan may be marginally less awful than in its current form -- but it will remain entirely awful.
Compare this to Paul Krugman, one week later:
The Dodd-Frank changes make the plan less awful, mainly by creating an equity stake. Essentially, this makes it possible for the plan to do the right thing through the back door: use toxic-waste purchases to acquire equity, and hence inject capital after all. Also, the oversight means that Treasury can be prevented from making the plan a pure gift to financial evildoers. But it's still not a good plan.
Stick with me, and you can read the news at least a week early.

Krugman also says, "the financial crisis is all too real." There are two aspects of what is happening: one is real, and one is manufactured in significant part, precisely to create the kind of crisis atmosphere that makes abominable legislation like the bailout possible. In various discussions and blog posts, I see people struggling to make all these events fit into one category or the other: either it's all real, or it's all "strategic behavior on the part of big financial players who stand to benefit from the bailout." This is exactly the kind of dualistic error I discussed in this essay. It's not either-or: it's both. The basic problem is very real; in significant part, the theatrics that have been orchestrated around it are not.

Here is Whitney on the real problem at the opening of his new article:
The financial system is blowing up. Don't listen to the experts; just look at the numbers. Last week, according to Reuters, "U.S. banks borrowed a record amount from the Federal Reserve nearly $188 billion a day on average, showing the central bank went to extremes to keep the banking system afloat amid the biggest financial crisis since the Great Depression." The Fed opened the various "auction facilities" to create the appearance that insolvent banks were thriving businesses, but they are not. They're dead; their liabilities exceed their assets. Now the Fed is desperate because the hundreds of billions of dollars of mortgage-backed securities (MBS) in the banks vaults have bankrupted the entire system and the Fed's balance sheet is ballooning by the day. The market for MBS will not bounce back in the foreseeable future and the banks are unable to roll-over their short term debt.

The Federal Reserve itself is in danger. So, it's on to Plan B; which is to dump all the toxic sludge on the taxpayers before they realize that the whole system is cratering. It's called the Paulson Plan, a $700 billion outrage which has already been disparaged by every economist of merit in the country.

From Reuters: "Borrowings by primary dealers via the Primary Dealer Credit Facility, and through another facility created on Sunday for Goldman Sachs, Morgan Stanley, and Merrill Lynch, and their London-based subsidiaries, totaled $105.66 billion as of Wednesday, the Fed said."

See what I mean; they're all broke. The Fed's rotating loans are just a way to perpetuate the myth that the banks aren't flat-lining already. Bernanke has tied strings to the various body parts and jerks them every so often to make it look like they're alive. But the Wall Street model is broken and the bailout is pointless.
They're stealing your money and that of your children and grandchildren and of their children and grandchildren -- all for something that cannot possibly work. It's not designed to work in that sense: it's designed to prop up our rulers for a while longer. That's all. That's the whole disgusting, sickening, criminal scheme.

One of the more monumental lies in the Washington Post story comes in these brief excerpts:
Administration officials have stressed that the ultimate cost of the bailout would be much less than $700 billion because the government would eventually sell the assets it purchased and recover most, if not all, of its investment.


Democratic leaders have emphasized to rank-and-file members that Paulson has told them that he could only spend about $50 billion a month on the securities purchase program [!!!]. Of the $700 billion figure, House Majority Leader Steny Hoyer (D-Md.) said: "Nobody believes that's going to be the final cost."
It appears that Hoyer operates on the premise that everyone is as big a moron as he is. He seems to think the final tally will be less than $700 billion.

But Hoyer is entirely correct to note that $700 billion isn't even close to the real cost. Mike Whitney again:
How did Treasury Secretary Paulson figure out that recapitalizing the banking system would cost $700 billion? Or did he just estimate the amount of money that could be loaded on the back of the Treasury's flatbed truck when it sputters off to shower his buddies at Goldman Sachs with freshly minted greenbacks? The point is, that Paulson's calculations were not assisted by any economists at all, and they cannot be trusted. It is a purely arbitrary, "back of the envelope" type figuring. According to Bloomberg: Swiss investor Marc Faber, known for a long track record of good calls, believes the damage may come to $5 trillion:
"Marc Faber, managing director of Marc Faber Ltd. in Hong Kong, said the U.S. government's rescue package for the financial system may require as much as $5 trillion, seven times the amount Treasury Secretary Henry Paulson has requested....

"The $700 billion is really nothing," Faber said in a television interview. "The Treasury is just giving out this figure when the end figure may be $5 trillion."
In connection with the deliberately orchestrated panic and doom that will shortly succeed in stampeding the Congress into passing what may amount to one of the final death blows to the struggling U.S. economy, Whitney first notes the "strategic behavior on the part of big financial players who stand to benefit from the bailout" that I discussed the other day.

Whitney then goes on:
"Market Ticker's" Karl Denninger confirms that the Fed has been draining the banking system of liquidity in order to blackmail Congress into passing the new legislation. Here's Denninger:
"The Effective Fed Funds rate has been trading 50 basis points or more below the 2% target for five straight days now, and for the last two days, it has traded 75 basis points under. The IRX is demanding an immediate rate cut. The Slosh has been intentionally drained by over $125 billion in the last week and lowering the water in the swamp exposed one dead body - Washington Mutual - which was immediately raided on a no-notice basis by JP Morgan. Not even WaMu's CEO knew about the raid until it was done....The Fed claims to be an ‘independent central bank.’ They are nothing of the kind; they are now acting as an arsonist. The Fed and Treasury have claimed this is a ‘liquidity crisis’; it is not. It is an insolvency crisis that The Fed, Treasury and the other regulatory organs of our government have intentionally allowed to occur."
A crime syndicate is running the executive and legislative branches of the U.S. government. No, that's not accurate. A crime syndicate is the executive and legislative branches of the U.S. government.

Whitney has still more, including basic guidelines from Market Ticker for "a workable solution" to the real problem that exists. Those guidelines are remarkably sensible and would probably be effective -- which means there is not a chance in hell Congress will ever seriously consider them.

Look at it this way. Perhaps you've secretly dreamed of a life of great wealth and power, of a life of crime. Now your mother won't have to lie and make up stories about what you do for her neighbors and friends. She can just tell them you've gone to work on Wall Street, or in Washington. Everyone will be happy and proud.

Everyone, that is, except for the overwhelming majority of Americans, whose lives have been thrown away and who will stumble through the joyless days remaining to them struggling to pay for the luxuries and amusements of their rulers. Welcome to the nation of crime that is your home.

September 26, 2008

Game Theory: Playing Craps with Your Life, or: Some Poor Schnook with a Blog versus...Krugman!

I've written extensively about the origins, motivations and goals of the ruling class. Among other essays, you can consult these three in particular for the general argument:

The Elites Who Rule Us

It's Called the Ruling Class Because It Rules

Psst -- While You Were Gibbering, the Ruling Class Rigged the Game and Won Everything

And about the economic "crisis" in particular:

The Vampire, Struck by Sunlight

Last evening, I came across yet another way in which the ruling class, or certain key elements in the ruling class, achieve their ends. I read the following quite by accident, just following one link to another, to another, and so on. I haven't seen this idea highlighted anywhere, and no one of any prominence has discussed it at all to my knowledge.

The following excerpts are from a short Bloomberg article. The key is in the last two paragraphs, which I have highlighted:
More than 150 prominent U.S. economists, including three Nobel Prize winners, urged Congress to hold off on passing a $700 billion financial market rescue plan until it can be studied more closely.

In a letter yesterday to congressional leaders, 166 academic economists said they oppose Treasury Secretary Henry Paulson's plan because it's a "subsidy'' for business, it's ambiguous and it may have adverse market consequences in the long term. They also expressed alarm at the haste of lawmakers and the Bush administration to pass legislation.

"It doesn't seem to me that a lot decisions that we're going to have to live with for a long time have to be made by Friday,'' said Robert Lucas, a University of Chicago economist and 1995 Nobel Prize winner who signed the letter. ``The situation may get urgent, but it's not urgent right now. Right now it's a financial sector problem.''

The economists who signed the letter represent various disciplines, including macroeconomics, microeconomics, behavioral and information economics, and game theory. They also span the political spectrum, from liberal to conservative to libertarian.


Erik Brynjolfsson, of the Massachusetts Institute of Technology's Sloan School, said his main objection "is the breathtaking amount of unchecked discretion it gives to the Secretary of the Treasury. It is unprecedented in a modern democracy.''

Advocates for a rescue plan this week point to a seizing up of credit markets, reflected in elevated inter-bank lending rates, as reason for action. Some economists are unconvinced.

"I suspect that part of what we're seeing in the freezing up of lending markets is strategic behavior on the part of big financial players who stand to benefit from the bailout,'' said David K. Levine, an economist at Washington University in St. Louis, who studies liquidity constraints and game theory.
Of course, I have no way of knowing directly whether and to what extent this is true or not, neither does Levine, and neither do you. But in terms of the logic of the situation, I find the idea that this is occurring completely believable. In fact, I would go further: I think it must be true, because of the way in which the ruling class operates. And remember that much of our knowledge is not direct in that sense: we reason by inference on the basis of facts that are known to us. If we are careful and conscientious in our method, such knowledge is as fully valid as knowledge based on direct observation.

Many people have correctly noted that what is occurring with the economic "crisis" is identical in crucial ways to the leadup to the invasion of Iraq, in particular with regard to the purposeful creation of an atmosphere of crisis and possible catastrophic consequences if action is not taken. And there is a critical related point: to make certain that the action that is finally taken is what the ruling class has decided it wants, the evidence and the facts will be endlessly distorted, misrepresented, and not infrequently lied about altogether. This is the way the ruling class operates, so as to convince a sufficient number of Americans that what is being done is in their own "interests," that it is best "for America," that it is the obvious course of action to be followed.

What all that means, in fact, is that the already decided upon course of action is what the ruling class wants. The ruling class wants what it wants because their preferred course of action will strengthen their own existing power, and increase their power and wealth still more. But if too many Americans don't go along, there might be some resistance. That could mean trouble, at least along the margins. The ruling class prefers not to be inconvenienced in this manner. So, to return to the Bloomberg article, in the current "crisis," key elements of the ruling class are playing craps with your life -- and they've loaded the dice.

When you wade through all the various analyses of the economic "crisis," almost every writer finally circles back to the alleged "seizing up of credit markets." This is the problem that purportedly threatens massive economic destruction, and that will bring an end to The World as We Know It. Paul Krugman is widely admired by many liberals and progressives. I have noted before, in connection with foreign policy, how almost every liberal and progressive blogger has been entirely coopted by the Establishment. From a longer discussion:
As the inconceivable dangers of wider war, including possible nuclear exchanges, loom over us all, petty partisanship and party loyalty as the primary concern are morally distasteful at a minimum, and occasionally abhorrent in their worst manifestations, intellectually irresponsible, and immensely dangerous. Such an approach does nothing to decrease the continuing calamities that confront us, but only worsens them.

It should also be noted that, while many liberal-progressive writers and bloggers appear to imagine they are challenging "conventional wisdom," this mode of analysis only strengthens that "wisdom" and ensures that the governing class will never be seriously challenged. In fact, to maintain that this administration's foreign policy represents a radical break with history rather than admitting, as the record conclusively demonstrates, that it continues what went before, serves the purposes of the governing class in every way it could demand -- precisely because it completely fails to seriously question the basic underlying assumptions and framework. In this manner, many liberal-progressive bloggers and writers have been entirely coopted by the establishment elites, certainly insofar as foreign policy is concerned. The elites know it; many liberals and progressives haven't figured it out yet. I would say the joke's on them, but for the fact that the stakes involved may literally be the future of the world itself (although I have no doubt that many members of the governing class are enjoying much hearty laughter). Even if the damage is limited to our own country and those nations we criminally attack even when they are no threat to us, the scope of the present and possible future devastation is beyond contemplation.
In their admiration for Krugman, the liberal and progressive commentators and bloggers I have in mind (in many instances, the same people) forget that Krugman is very much an Establishment figure himself. He's not some poor schnook with a blog like me. He's Krugman!, with a major platform in a central pillar of the Establishment, the fabulously fantastic New York Times, champion of the destruction of Iraq and liar about the danger represented by Iran (for years now), among other notable achievements. So when it comes to a critical moment, when the goals of the ruling class appear to be in some danger of being thwarted, however temporarily, Krugman is not about to question the central tenets of "conventional wisdom."

And so we have Krugman in his latest column:
Many people on both the right and the left are outraged at the idea of using taxpayer money to bail out America’s financial system. They’re right to be outraged, but doing nothing isn’t a serious option. Right now, players throughout the system are refusing to lend and hoarding cash — and this collapse of credit reminds many economists of the run on the banks that brought on the Great Depression.

It’s true that we don’t know for sure that the parallel is a fair one. Maybe we can let Wall Street implode and Main Street would escape largely unscathed. But that’s not a chance we want to take.

So the grown-up thing is to do something to rescue the financial system
You see the reliance on the major element in the form of "this collapse of credit." But what if "this collapse of credit" is "strategic behavior on the part of big financial players who stand to benefit from the bailout"? What if that is true even in part? Doesn't and shouldn't that affect what the government response is, if any? But Krugman won't mention that. Wouldn't be prudent. Won't help the ruling class.

And if you keep your critical thinking cap on, the questions about the opening paragraphs in Krugman's column are endless (and they are not answered in the balance of the column). "Doing nothing isn't a serious option." I can argue that way: "Doing something -- Krugman's own word -- isn't serious." But, insists Krugman, doing "something" is "the grown-up thing to do."

This isn't arguing when I do it or when Krugman does it. It's name-calling and intimidation -- and it's substituting name-calling and intimidation for making your case. What exactly are the consequences of doing nothing? Who would feel those consequences, in what form, and when? How do you know those will be the consequences?

And: what will be the consequences of doing "something" -- especially when that "something" involves adding an unfathomable amount of debt to the already monumental national debt? Won't that have many dire consequences that will be felt by all Americans? How do the consequences of doing this particular "something" compare to the consequences of doing nothing? Which is likely to be worse? How do you know that?

Et cetera, et cetera, et cetera.

"But that's not a chance we want to take." Who's this "we"? Speak for yourself, bub. That "we" does not include me. But this is how consensus is manufactured. And most people, fearful of independence, terrified of being thought "peculiar" and of being ridiculed, will go along. After all, Krugman! is an "expert." He knows best. All this is in addition to the failures in Krugman's analysis I noted the other day.

Just like all those "experts" knew best about Iraq. All this goes to show, still one more dreadful time, the truth of one of my continuing themes. No matter how many examples pile up, no matter how catastrophic and bloody the consequences of "acting now" are, no matter how many times the "experts" are proved wrong, the great majority of Americans are incapable of learning one single damned thing. Just change the specifics, move to another subject, and they'll fall for it all over again.

We are a nation of idiots, incapable of holding a single original thought.

But, hey, what do I know. I'm just a poor schnook with a blog. And he's Krugman! I see further great achievements in the man's future. Perhaps, Krugman! -- The Musical! He'd better be careful, though. If it bombs, he'll just be another poor schnook with a blog.

But he can write about economics and Broadway theater. Sounds like a winner.

September 25, 2008

Well, The World Isn't Going to End Tomorrow

Hmm. It probably isn't going to end tomorrow. Just in case, let's meet for drinks (and drinks and drinks and drinks!) this evening. Seriously (!!!), I've made that point repeatedly; see here, or here in longer form. Barring large-scale catastrophes -- and the dolts in D.C. doing what they've been doing for many decades, albeit in more extreme form today, doesn't count -- our lives will most likely bumble along for some time to come. There will be increasing anxiety, deteriorating overall quality of living, greater madness at the edges, slowly spreading over a larger area of our existence, but, hey. You'll still have American Idol or its equivalent. You'll still have a job (of sorts), a home (of sorts), and life (of sorts) will go on. Probably.

And...I have to pay rent next week. Again! Those months keep coming, just like the hits. So, where is that post explaining the wondrousness that is my life....yeah, here it is. Things are basically the same now as they were in January 2007 -- except that my overall health is considerably worse, so the details of my day-to-day existence get pretty ugly now. Oh, it's going to be very hot here in Los Angeles today and probably through the weekend. The heat tends to completely wipe me out at this point, so posting might be a little slow for a few days. And the essays I'm working on -- such as the completion of this one -- are very difficult in the best of circumstances. Which these circumstances are not. If my body manages to make it through another year (don't place bets on it), I will have to get an air conditioner that actually works next year. I don't know how I'll survive another L.A. summer otherwise. (There is something called an air conditioner parked in one of my bedroom windows. It barely works at all, although it does gush forth an astonishing amount of water.)

But I'm not going to die tomorrow. Or even in the next few months. (Probably.) And people say I'm a pessimist! Poopyheads. So I need to pay rent and utilities. Food would be nice. I realize this is a rotten time to ask for donations, since everyone has started stashing those rolls of greenbacks (or piles of silver and gold, if you're seriously planning ahead) in their mattresses. But we're all in this together! It's our patriotic duty to help Amurka survive! Joe Biden said that, so it must be true. Probably none of you is flush any longer, so I figure if 80 people or so donate $10 each, I can manage to get by for another month. Things will be tight, but do-able. Yes, I survive on next to nothing. Life is grand. And consider this: if you've been following my writing over the last several weeks, I told you everything that would happen with the bailout and why before it happened! You can't pay for smarts like that! But you can try. Hahahaha. Gotta keep our sense of humor.

My deep gratitude as always to all those who have made donations and who support my work in various ways. And my thanks for your consideration in listening to my request on yet another occasion. PayPal and Amazon links will be found at the upper right.

Many thanks for your time.

September 24, 2008

The Only Appropriate Response

Although this has been standard operating procedure for the State since the State first appeared on Earth -- not only in the United States, and not only during Republican administrations (hardly) -- you don't see this noxious mechanism expressed so clearly and crudely all that often:
At Wednesday's House hearing, Rep. Steve LaTourette cut to the chase, summing up the frustration of members who think their constituents aren't getting the gravity of the situation from the dispassionate Bernanke and Paulson show.

LaTourette began talking about "my guy on the couch" back home in his district who was hassled by his boss and angered about doubts he'll be able to get a new car, keep his job, retain his credit card and save for his daughter's education.

"He's scared because he's the first generation who can't pass on the American dream to his daughter," said the Ohio Republican -- adding, "In order to accept this plan...he needs to be more scared."

Paulson obliged.

“He should be angry and he should be scared – and I think right now he’s angrier than he is scared,” said Paulson “And it puts us in a difficult position—no one likes to be painting an overly dire picture and scaring people, but the fact is that if the financial markets are not stabilized the situation can be very severe as it relates not just to his current situation – but keeping his job… this is a serious situation and one he should be concerned about.”
I would prefer not to be rude repeatedly, but sometimes you don't have a choice.

Fuck you, Steve.

Fuck you, Hank.

Gee, I told Hank that just a few days ago.

Also see here, and here.

And in a little while, we will be further enlightened by Mr. Bush. We are blessed.

September 23, 2008

Studies in Conformity, Generating Consensus, and Why You Are Not Adults

The superficiality and triviality of our public debates reveal themselves in many ways. I've discussed the mechanisms involved in numerous essays. The response to the current economic crisis, including the response to the "solutions" proposed, presents one of those mechanisms in stark, unforgiving terms.

Insofar as the economic crisis is concerned, I will remind you of the relevant context in exceedingly brief terms. In my rude post the other day, I emphasized that the fundamental flaw in all the "solutions" offered is that those solutions are offered to "fix" a problem that cannot be fixed. To understand this basic point, you require only three sentences from Mike Whitney's analysis. Here they are:
This cycle [in the market] will persist until the bad debts are accounted for and written off or until the exhausted dollar-system collapses altogether.
In truth, there is no fix for a deleveraging market any more than there is a fix for gravity. The belief that massive debts and insolvency can be erased by increasing liquidity just shows a fundamental misunderstanding of economics.
This is the truth that almost no one will accept.

Denial of the truth envelops our culture like a suffocating fog. People desperately need to understand the consequences of denial of this kind. It is profoundly damaging, and it kills. I have written at length abour our national narcissism, and how that narcissism allows us to deny the immense crime the U.S. government has committed in Iraq. You would think the fact that our government has murdered well in excess of one million innocent people would be front page news every day. Of course, you would be wrong. You might prefer to believe that, since the murder continues as I write this, as it will continue tomorrow and for years to come, there might be one or two decent and humane individuals in Washington who are working ceaselessly to make the slaughter stop. And you might like to think that many Americans would be outraged that our military continues to occupy a nation that we have entirely destroyed, and that Americans would demand that the destruction and death cease immediately.

About all of that, you are terribly, grievously wrong. Most Americans can't be bothered about any of that. Most Americans simply do not care.

The denial extends far beyond the deaths of innocents, although that alone is unbearable to contemplate. Except for stories offered now and then, our media and most Americans similarly cannot be bothered with the lifelong damage caused to American soldiers. Sometimes, that denial leads those soldiers to kill themselves. Most Americans don't care. We don't want to hear about pain of this kind. It upsets us and makes us uncomfortable. I have indicated why you should be prepared to feel upset and uncomfortable about such matters -- see "Let the Victims Speak" -- and why that should be a minimal requirement for a semi-humane society. In a better world, this would not be a difficult test to pass. We fail it miserably.

These are among the reasons for my admonition at the conclusion of an essay I wrote a year and a half ago: "The Elites Who Rule Us." That article discussed in detail why most people are unable to grasp the reality of our ruling class, the makeup of our ruling elite, and the ways in which the ruling class exercises its control. At the end of that lengthy analysis, I wrote:
I suppose I could briefly summarize the argument in the following manner: Grow up. Be adults about this. And for God's sake, be serious.
With very rare exceptions, my plea fell and continues to fall on ears made deaf by choice, on minds that absolutely refuse to consider matters that cause them distress beyond a fleeting moment of slight discomfort. Americans agonize over who will win a ridiculous television show contest, yet they refuse to consider the ways in which they permit the bodies of innocent human beings to be ripped apart every day, just as they refuse to reach out to those whose souls have been damaged beyond repair. Yet I will continue to make my plea, for until we become adults, we will remain mired in the patterns of thought and the immense destructiveness that threaten to rip our world apart once and for all.

The fact that most Americans refuse to grow up and be adults has many results. One of them is critically relevant here: most Americans will not accept that actions have consequences, and that those consequences are sometimes irrevocable. Your prayers will not restore over a million slaughtered Iraqis to life. Your wishes will not instantaneously erase the horrifying memories that make an American soldier unable to sleep, incapable of holding a job, and that make him a stranger to his own family. There are times when our actions lead to results that cannot be undone.

For the moment, I will continue to adopt terms that are commonly used about this phenomenon, although I will refashion them for my own purposes and make them accurate. People often accuse adults who act in the manner I have described as "children." Please note that this is profoundly wrong. It certainly does not describe healthy children. If children are treated with genuine respect and compassion, if they are regarded as full human beings in their own right, they will treat themselves and others with respect and compassion. Almost no parents treat their children in this manner, a subject I have discussed in great detail in my Alice Miller essays, and one I will discuss still further in my new tribalism series.

When people say adults behave and think like children, what they more properly mean is that they behave and think like children who are profoundly damaged -- children who are already made emotionally numb by the typical kind of emotional abuse to which most children are subjected many times a day, children who have been forced to deny their own pain simply to survive, and who are therefore unable to grasp the pain of others. Most adults were once such children; one of the ways the damage reveals itself when they become adults is the denial described above and in many of my articles.

Many children believe that "wishing will make it so," just as they believe that there are no consequences for their actions that cannot be undone. But again, children who believe this are those children who are already damaged. Healthy children do not think in this manner. But most of us were greatly damaged as children, and most of us deny what ought to be unavoidable truths because we learned to do this in our earliest years of life.

Read the three sentences at the beginning about the irrevocable economic consequences now playing out again. These are not difficult ideas. Yet most Americans -- and our entire governing class and almost all commentators and bloggers -- refuse to grasp them. It is as if these ideas are written in a dead language. Certainly, the language is dead to them, for they have made themselves incapable of understanding it. To recognize a truth of this kind threatens the mechanism of denial that lies at the very center of their sense of themselves, at the very center of their identity. So the truth cannot be acknowledged.

To return to the economic crisis in particular, I first repeat the single most important point: the consequences we are now seeing are irrevocable and unavoidable. The bad debts must be accounted for and written off. A problem of massive bad debts and insolvency is not a problem of liquidity. This truth means one thing in terms of the "solutions" proposed: a massive bailout of insolvent financial institutions which includes keeping the bad debts in the system still longer is precisely the wrong action to take. It will not solve the problem, for this problem cannot be solved. But it will accomplish one goal: it will postpone the problem to another day, and it will make the problem worse, and it will cause still greater damage.

Do you know of a single government program that has not exceeded its original estimated cost? It is ridiculous to believe that this proposal will cost $700 billion. When all is said and done, as you will see only a few commentators acknowledge, this program will cost well in excess of one trillion dollars. On top of the national debt that already exists, what do you think this will do to the American economy for decades to come? One of the arguments in my post the other day can be expressed another way. Note how the debate has shifted: we are not debating whether this bailout should occur. We are debating in precisely what manner the bailout should occur. In other words: the only debate that should be occurring has already been consigned to history.

Here are some additional details that confirm the accuracy of arguments I have previously made. Note these passages from the Wall Street Journal:
WASHINGTON -- The Bush administration and the Democratic Congress inched closer to agreement on a $700 billion plan to rescue troubled financial firms, with the Treasury making most of the concessions amid an increasing backlash from a range of economists and lawmakers.

The administration agreed to allow tougher oversight over the cleanup and provide fresh assistance to homeowners facing foreclosure, two Democratic priorities. In addition, negotiators neared agreement on allowing the government to take equity stakes in certain companies that participate in the rescue.


One broad area of agreement involves congressional oversight. Rep. Frank said the Treasury agreed to an independent board to monitor the bailout and report on its progress to Congress and the public. The board wouldn't have authority to veto Treasury investment decisions, and the bailout's launch wouldn't be delayed while a board was being put in place.
Compare this to what I wrote the other day:
At this point, does anyone believe "strings" or "oversight" are worth a goddamned thing? Let me remind you of something that no Democrats and none of their defenders wants to be reminded of: the Iraq catastrophe. The Democrats have had the biggest "oversight" mechanism in the world -- or to be precise, in the Constitution -- since early 2007. The Democrats could have cut off all funding for this criminal war and occupation. They will not do it.

They could have impeached Bush, Cheney and several more of the leading criminals. They will not do it.

Add in the pattern the Democrats followed in the FISA debacle, with regard to the Military Commissions Act, and on a host of other questions, and you see what the Democratic opposition is worth. In a word: nothing.

Add in this: everyone, including every Democrat, now agrees that this is a "crisis" requiring action yesterday. Paulson, the Treasury Department, and the other players will have to be able to act immediately, and to act on a massive scale. And they'll get all that -- but with some "oversight." How long will it be until the "oversight" catches up to what these criminals have done, if it ever does? After the fact, will the oversight mechanisms be able to reverse the actions of Paulson and others? What will be the additional costs of having to reverse some/most of those actions after the fact, if it can even be done?

Given the record amassed by this administration -- and given the record amassed by the most pathetic Democratic Congress ever imagined in this or any other world -- "oversight" and "safeguards" aren't worth shit.
You may view this as expressed in an unspeakably rude manner. The fact remains that it is accurate in every detail.

The same fundamental problem will be found in Dodd's proposal. Indeed, the problem is announced at the very beginning: "TITLE I - Authorizing the Treasury Department to Buy Mortgage-Related Assets." Why is Dodd proposing to authorize anyone to buy mortgage-related assets? That is exactly what must not be done, especially in a massive amount and with taxpayers' money.

Dodd's plan is no better with regard to "oversight"; see Section 4 (among other provisions: "The Emergency Oversight Board shall meet 2 weeks after the first exercise of the purchase authority of the Secretary under this Act and monthly thereafter." Yeah, that should do it.). In addition to the fact that the centerpiece of Dodd's proposal is the one action that should not be taken and that will do nothing to "solve" an insoluble problem, is its gross immorality: presenting the bill to American taxpayers who had nothing to do with creating this crisis. And yet, even Paul Krugman claims that Dodd's proposal is "a big improvement over Paulson's plan." Note the language:
The key feature, I believe, is the equity participation: if Treasury buys assets, it gets warrants that can be converted into equity if the price of the purchased assets falls. This both guarantees against a pure bailout of the financial firms, and opens the door to a real infusion of capital, if that becomes necessary — and I think it will.
So it's not "a pure bailout" -- but it's still a bailout, paid for with money extorted from American taxpayers.

In other words, Krugman insists that we solve a problem that cannot be solved -- but that we do it more "efficiently" and "competently." This is precisely the argument that Democrats, liberals and progressives always make -- even with regard to momentous war crimes like the invasion and occupation of Iraq. In still other words: they concede the basic terms of the argument, and argue only over the specific implementation. And then they pretend to wonder why they keep losing the argument. Here's a clue: they keep losing the argument because they never engage it. If Krugman and the many others like him have their way, the immorality and the futility will continue, in economic policy, in foreign policy and in every other area -- but the immorality and futility will be carried out more "efficiently."

It's downright inspiring, that's what it is.

Take a look at a description of the famous Asch experiment in social conformity. Another simple test, as simple as recognizing that certain consequences are unavoidable should be. Yet many people got it wrong. You know perfectly well why they got it wrong:
To Asch's surprise, 37 of the 50 subjects conformed to the majority at least once, and 14 of them conformed on more than 6 of the 12 trials. When faced with a unanimous wrong answer by the other group members, the mean subject conformed on 4 of the 12 trials. Asch was disturbed by these results: "The tendency to conformity in our society is so strong that reasonably intelligent and well-meaning young people are willing to call white black. This is a matter of concern. It raises questions about our ways of education and about the values that guide our conduct."

Why did the subjects conform so readily? When they were interviewed after the experiment, most of them said that they did not really believe their conforming answers, but had gone along with the group for fear of being ridiculed or thought "peculiar." A few of them said that they really did believe the group's answers were correct.

Asch conducted a revised version of his experiment to find out whether the subjects truly did not believe their incorrect answers. When they were permitted to write down their answers after hearing the answers of others, their level of conformity declined to about one third what it had been in the original experiment.

Apparently, people conform for two main reasons: because they want to be liked by the group and because they believe the group is better informed than they are.
The pathetic truth is that most people fear genuine independence more than they fear death itself. So desperate are they for "acceptance" and so fearful of being thought "peculiar," they will deny the evidence of their own eyes and mindlessly repeat the lies and ignorance of others. When it comes to a subject like economics or foreign policy, they think: "Oh, that's so hard! I can't understand that. I'll just listen to what the 'experts' say. They know best."

If events of the last seven years have demonstrated nothing else at all, they should have made absolutely clear that "experts" are often the very last people you should look to for guidance. The experts are precisely those people most likely to repeat "conventional wisdom," that is, the views accepted by the ruling class -- because, by virtue of the fact that they are regarded as experts, they are part of the ruling class.

And now we see it all again. The bailout will be made. You, your children, your grandchildren and their children will pay for it for endless decades to come -- all because there is no brave child to say the emperor is naked. There is certainly no courageous adult like Robert La Follette. We argue over details, but the only argument that matters was concluded before it was begun.

And so, still one more time, I repeat my plea:
Grow up. Be adults about this. And for God's sake, be serious.

September 22, 2008

No, You're Not Crazy

You're not crazy, that is, if you've begun to have waking nightmares about what might be coming as the economy worsens and signs of "normalcy" (of what?) begin to vanish from our lives. Many more people without jobs and homeless, tent cities springing up here and there, perhaps regular power outages and growing shortages of goods that had once been plentiful...the list goes on and on.

And what, you might wonder, is our beneficent, all-caring government doing to prepare for this multitude of possibilities? After all, some of those poor, jobless, homeless, starving people might get unruly.

The government of the United States is a wondrous creation and, naturally, it only wants to "help" you:
The 3rd Infantry Division’s 1st Brigade Combat Team has spent 35 of the last 60 months in Iraq patrolling in full battle rattle, helping restore essential services and escorting supply convoys.

Now they’re training for the same mission — with a twist — at home.

Beginning Oct. 1 for 12 months, the 1st BCT will be under the day-to-day control of U.S. Army North, the Army service component of Northern Command, as an on-call federal response force for natural or manmade emergencies and disasters, including terrorist attacks.

It is not the first time an active-duty unit has been tapped to help at home. In August 2005, for example, when Hurricane Katrina unleashed hell in Mississippi and Louisiana, several active-duty units were pulled from various posts and mobilized to those areas.

But this new mission marks the first time an active unit has been given a dedicated assignment to NorthCom, a joint command established in 2002 to provide command and control for federal homeland defense efforts and coordinate defense support of civil authorities.

After 1st BCT finishes its dwell-time mission, expectations are that another, as yet unnamed, active-duty brigade will take over and that the mission will be a permanent one.

“Right now, the response force requirement will be an enduring mission. How the [Defense Department] chooses to source that and whether or not they continue to assign them to NorthCom, that could change in the future,” said Army Col. Louis Vogler, chief of NorthCom future operations. “Now, the plan is to assign a force every year.”


They may be called upon to help with civil unrest and crowd control or to deal with potentially horrific scenarios such as massive poisoning and chaos in response to a chemical, biological, radiological, nuclear or high-yield explosive, or CBRNE, attack.


The 1st BCT’s soldiers also will learn how to use “the first ever nonlethal package that the Army has fielded,” 1st BCT commander Col. Roger Cloutier said, referring to crowd and traffic control equipment and nonlethal weapons designed to subdue unruly or dangerous individuals without killing them.

“It’s a new modular package of nonlethal capabilities that they’re fielding. They’ve been using pieces of it in Iraq, but this is the first time that these modules were consolidated and this package fielded, and because of this mission we’re undertaking we were the first to get it.”

The package includes equipment to stand up a hasty road block; spike strips for slowing, stopping or controlling traffic; shields and batons; and, beanbag bullets.

“I was the first guy in the brigade to get Tasered,” said Cloutier, describing the experience as “your worst muscle cramp ever — times 10 throughout your whole body.

“I’m not a small guy, I weigh 230 pounds ... it put me on my knees in seconds.”
"Nonlethal weapons designed to subdue unruly or dangerous individuals without killing them..." Frequently, it doesn't work out that way: "Obey or Die."

But you were being unruly. You might be dangerous, at least dangerous to those who rule us. And honestly, the fact that you may be homeless, starving and desperate is no reason to be rude or uncooperative.

This comes at the very end of the story, offered by the division operations officer:
“I don’t know what America’s overall plan is — I just know that 24 hours a day, seven days a week, there are soldiers, sailors, airmen and Marines that are standing by to come and help if they’re called,” Cloutier said. “It makes me feel good as an American to know that my country has dedicated a force to come in and help the people at home.”
I'm sure there are people in the military who believe this, or at least think they believe it. But if and when the order comes to fire on American citizens, what happens then? I don't think we want to find out. Many of these individuals are overly familiar with killing innocent people -- as indeed, our criminal war in Iraq is nothing but an operation dedicated to killing innocent people in ungraspably huge numbers -- so a new kind of target probably won't deter them for long, if at all.

Add in all the private mercenary forces now available to the government, and, well...

No, you're not crazy. The reasons for my argument will become clearer in the second and concluding part of this new essay of mine, "The State and Full Spectrum Dominance, Abroad and At Home" -- but this gives you an idea of why I chose the phrase "Full Spectrum Dominance," a phrase that usually refers to U.S. military capabilities in particular, and why I included "At Home." But I am concerned with "Full Spectrum Dominance" in a still broader sense, as I will soon explain.

Pleasant dreams, dear reader.

(Via via, although neither provided the Army Times link.)

The State and Full Spectrum Dominance, Abroad and At Home

I offer here some observations about the State, any state, at any time, anywhere in the world. The continuing economic conflagration has caused me to reexamine certain ideas with additional information, and from a perspective that differs in certain ways from my earlier methods of analysis. While I am confident that what follows is correct with regard to the most important general points, I am still investigating many particulars. It is more than likely I will return to these issues with further specific examples, and with additional thoughts about particular manifestations of the dynamics involved.

When I refer to the State, I use that term with perhaps its most generally accepted meaning: those individuals and those economic-societal interests that direct the mechanisms of control and enforcement over a designated geographic area. These mechanisms may be reflected in a written document, but that is not required. I start from this basic principle:
[F]rom the first historic forms of the State, the State has always formed and will always form alliances with certain individuals and segments of society -- to which the government bureaucrats will provide favors and special dispensations, and to the severe disadvantage of those individuals and groups that are not so favored. ... [O]ur contemporary tribalists believe, without any history or evidence whatsoever to support the claim, that if only members of their tribe were in charge, they would act in saintly and disinterested ways, and they would be uniformly non-venal, non-self-seeking, and non-human. Good luck with that. It has never happened and it never will, barring a fundamental transformation of what it means to be human.
Another crucially related idea flows from this one, and it concerns the significance of law to the State:
The law is not some Platonic Form plucked from the skies by the Pure in Heart. Laws are written by men, men who have particular interests, particular constituencies, particular donors, and particular friends. ... Laws are the particular means by which the state implements and executes its vast powers. When an increasingly authoritarian state passes a certain critical point in its development, the law is no longer the protector of individual rights and individual liberty. The law becomes the weapon of the state itself -- to protect, not you, but the state from threats to its own powers. We passed that critical point some decades ago. The law is the means by which the state corrals its subjects, keeps them under control, and forbids them from acting in ways that the overlords might perceive as threatening. In brief, today, in these glorious United States, the law is not your friend.
I think these ideas explain a great deal, but to understand the nature and origins of the State, and to grasp how the State will act once it has been established, we have to travel to a still deeper level.

For that, I return to Albert Jay Nock, and to this passage from my essay, "The United States as Cho Seung-Hui: How the State Sanctifies Murder":
In his classic book, Our Enemy, the State (first published in 1935), Albert Jay Nock makes a fundamental distinction between government and the State, a distinction I will soon discuss in more detail. For our purposes here, I too briefly note only the following in this regard: by government, Nock means that system that spontaneously arises out of a social order, where "in [Thomas] Paine's view the code of government should be that of the legendary king Pausole, who presented but two laws for his subjects, the first being, Hurt no man, and the second, Then do as you please, and that the whole business of government should be the purely negative one of seeing that this code is carried out." Nock goes on to note: "Paine's theory of government agrees exactly with the theory set forth by Mr. Jefferson in the Declaration of Independence."

This was not the concept of government embodied in the U.S. Constitution. Nock makes the argument that with the adoption of the Constitution, our nation's fate was already sealed; I have to confess that the longer I consider the matter and the more I read of world history and political theory, the more I am convinced that Nock was correct. It is worth recalling that many of the founders were notably lacking in confidence about the longevity of the system of government they had devised. The Constitution represented the abandonment of government for the State:
The positive testimony of history is that the State invariably had its origin in conquest and confiscation. No primitive State known to history originated in any other manner. On the negative side, it has been proved beyond peradventure that no primitive State could possibly have had any other origins. Moreover, the sole invariable characteristic of the State is the economic exploitation of one class by another. In this sense, every State known to history is a class-State. Oppenheimer defines the State, in respect of its origin, as an institution "forced on a defeated group by a conquering group, with a view only to systematizing the domination of the conquered by the conquerors, and safeguarding itself against insurrection from within and attack from without. This domination had no other final purpose than the economic exploitation of the conquered group by the victorious group."
Thus, it is not enough to say, as I myself did, that "the State has always formed and will always form alliances with certain individuals and segments of society," although that is also true. The more accurate statement, and a formulation that delves more deeply, is that the State would never have taken form at all, and it would not have been able to impose its rule, but for the existence of a class or group of individuals that crafted the State to their particular ends. Here, I am not concerned with evaluating whether those ends are good or bad (except for the fact that one may believe that domination and exploitation are always bad, as I do), but rather with identifying the basis on which the State is founded.

Those States that existed in the past and that exist in our world today have nothing to do with government in Nock's sense: a system that spontaneously arises out of a social order. As I have been considering these issues, I was first prepared to argue that Nock's idea of spontaneous social order represents voluntary action in a significant sense that the State does not. But I now think that is not exactly correct, for what appears to be spontaneous social order also relies on many elements of manipulation, control and coercion. I would go still further: order, when applied to any form of social activity, cannot occur in the complete absence of manipulation, control and coercion.

I plan to analyze many aspects of the mechanisms of manipulation, control and coercion in my series on tribalism. These mechanisms will be found in social networks, in political organizations, and -- most importantly, for this is the ultimate origin of all the rest -- in the family. And it is, in fact, in these other forms of order that many of the State's enforcement mechanisms find their start. Yet there remain two critical differences between government and spontaneous social order on the one hand, and the State on the other. The first difference concerns the degree of voluntary activity which is allowed: speaking very generally, instances of spontaneous social order permit a greater degree of voluntariness, both in the origins of that order which finally develops and in the ongoing operations of that order. This is what the word "spontaneous" designates: the order that arises is not imposed on a group of people in a particular area, but it begins on the ground, if you will, and rises up from there.

The second difference concerns the scale and effectiveness of the order involved, and the consequences of the scale and effectiveness attendant upon the State. For some thoughts on this question I turn to a fascinating article by Robert Higgs: "If Men Were Angels: The Basic Analytics of the State versus Self-government." The article is unusually provocative, and I strongly recommend reading it when you have time to consider Higgs' arguments and their implications.

Consider just a few brief excerpts. Higgs quotes the famous passage from Madison's Federalist No. 51, and then writes:
The passage that refers to the angels is a rhetorical masterpiece, so memorable that it has become almost a cliché. In Madison’s argument, however, it does more than emphasize that human nature is something less than angelic. It also serves as a springboard that propels Madison directly into a consideration of “framing a government which is to be administered by men over men,” which is “but the greatest of all reflections on human nature.” In short, it moves Madison directly to a consideration of government as we have known it for the past several thousand years—a monopoly operating ultimately by threat or actual use of violence, making rules for and extracting tribute from the residents of the territory it controls. Henceforth, for clarity, I refer to this all-too-familiar type of organization as “the state.”
In evaluating the benefits and dangers of the stateless mode of existence compared to the State, Higgs goes on to write:
Although I admit that the outcome in a stateless society will be bad, because not only are people not angels, but many of them are irredeemably vicious in the extreme, I conjecture that the outcome in a society under a state will be worse, indeed much worse, because, first, the most vicious people in society will tend to gain control of the state (Hayek 1944, 134-52; Bailey 1988; Higgs 2004, 33-56) and, second, by virtue of this control over the state’s powerful engines of death and destruction, they will wreak vastly more harm than they ever could have caused outside the state (Higgs 2004, 101-05). It is unfortunate that some individuals commit crimes, but it is stunningly worse when such criminally inclined individuals wield state powers.

Lest anyone protest that the state’s true “function” or “duty” or “end” is, as Locke, Madison, and countless others have argued, to protect individuals’ rights to life, liberty, and property, the evidence of history clearly shows that, as a rule, real states do not behave accordingly. The idea that states actually function along such lines or that they strive to carry out such a duty or to achieve such an end resides in the realm of wishful thinking. Although some states in their own self-interest may at some times protect some residents of their territories (other than the state’s own functionaries), such protection is at best highly unreliable and all too often nothing but a solemn farce. Moreover, it is invariably mixed with crimes against the very people the state purports to protect, because the state cannot even exist without committing the crimes of extortion and robbery, which states call taxation (Nock 1939), and as a rule, this existential state crime is but the merest beginning of its assaults on the lives, liberties, and property of its resident population.

In the United States, for example, the state at one time or another during recent decades has confined millions of persons in dreadful steel cages because they had the temerity to engage in the wholly voluntary buying and selling or the mere possession of officially disapproved products. Compounding these state crimes (of kidnapping and unjust confinement) with impudence, state officials brazenly claim credit for their assaults on the victims of their so-called War on Drugs. State functionaries have yet to explain how their rampant unprovoked crimes comport with the archetype described and justified in Locke’s Second Treatise of Government. In vain do many of us yearn for relief from the state’s duplicitous cruelty: Where is the state of nature when we really need it?
Higgs summarizes this part of his argument as follows:
With regard to large-scale death and destruction, no person, group, or private organization can even begin to compare to the state, which is easily the greatest instrument of destruction known to man. All nonstate threats to life, liberty, and property appear to be relatively petty, and therefore can be dealt with. Only states can pose truly massive threats, and sooner or later the horrors with which they menace mankind invariably come to pass.

The lesson of the precautionary principle is plain: because people are vile and corruptible, the state, which holds by far the greatest potential for harm and tends to be captured by the worst of the worst, is much too risky for anyone to justify its continuation. To tolerate it is not simply to play with fire, but to chance the total destruction of the human race.
Finally, consider this passage from Higgs' concluding section:
[E]verything that makes life without a state undesirable makes life with a state even more undesirable. The idea that the anti-social tendencies that afflict people in every society can be cured or even ameliorated by giving a few persons great discretionary power over all the others is, upon serious reflection, seen to be a wildly mistaken notion. Perhaps it is needless to add that the structural checks and balances on which Madison relied to restrain the government’s abuses have proven to be increasingly unavailing and, bearing in mind the expansive claims and actions under the present U.S. regime, are now almost wholly superseded by a form of executive caesarism in which the departments of government that were designed to check and balance each other have instead coalesced in a mutually supportive design to plunder the people and reduce them to absolute domination by the state.
You can begin to see how these ideas inevitably lead us to an examination of the present crisis.

This subject is very complex, and this is long enough for one installment. Some further thoughts about the State as such, and about the United States in general and concerning the present crisis in particular, will be offered in the next and concluding part of this essay.

September 21, 2008

Stupider than Shit

Yeah, rude headline for some of you. You don't have any idea how rude yet. As what little remains of the United States circles the drain for perhaps the last time, you think we should be worried about being polite and civil? Fuck that shit with a rusty saw, baby.

You want to know why Democrats, liberals and progressives keep getting rolled like the easiest, stupidest mark in the world? First is the fact that they don't disagree about the basic goals of governance. Here, the relevant goal is the establishment of an unassailable, all-powerful corporatist-authoritarian state at home. (Scroll through the archives if you're interested in finding the numerous essays on that subject. I frankly don't have the patience or interest for holding anyone's hand at this point.) Second is the fact that:


Fasten your bleeding eyes on this:
House Speaker Nancy Pelosi said in a statement today that Congress will take action this week, while adding that Democrats want more oversight of the proposed federal program. Democratic presidential candidate Barack Obama also said lawmakers must insist on more oversight.

Pelosi said that the administration's $700 billion proposal "does not include the necessary safeguards."

"Democrats believe a responsible solution should include independent oversight, protections for homeowners and constraints on excessive executive compensation."

"We will not simply hand over a $700 billion blank check to Wall Street and hope for a better outcome," she said.
Make sure you get the message. The Democrats will provide the check, it just won't be a blank check. The Democrats want "independent oversight." But the money will flow -- to insolvent financial institutions, precisely those institutions responsible for this debacle, and to buy up bad debts which will thus not be allowed to wash out of the system.

The Bush administration is not genuinely intelligent by any measure, but these criminals are shrewder than hell. Why do you think they made the initial proposal in the extreme form they did? Because they know that if they finally give the Democrats a few "safeguards," if they "attach a few strings," and perhaps if they allow for "independent oversight," the Democrats will give them the momentous bailout they want -- all to be paid for by American taxpayers for the next hundred years (assuming the U.S. survives in any recognizable form, which becomes more doubtful by the hour). The Democrats have already announced to the world that is exactly what they'll do.

The Democrats, liberals and progressives fall right into the trap, as they do every single fucking time.

At this point, does anyone believe "strings" or "oversight" are worth a goddamned thing? Let me remind you of something that no Democrats and none of their defenders wants to be reminded of: the Iraq catastrophe. The Democrats have had the biggest "oversight" mechanism in the world -- or to be precise, in the Constitution -- since early 2007. The Democrats could have cut off all funding for this criminal war and occupation. They will not do it.

They could have impeached Bush, Cheney and several more of the leading criminals. They will not do it.

Add in the pattern the Democrats followed in the FISA debacle, with regard to the Military Commissions Act, and on a host of other questions, and you see what the Democratic opposition is worth. In a word: nothing.

Add in this: everyone, including every Democrat, now agrees that this is a "crisis" requiring action yesterday. Paulson, the Treasury Department, and the other players will have to be able to act immediately, and to act on a massive scale. And they'll get all that -- but with some "oversight." How long will it be until the "oversight" catches up to what these criminals have done, if it ever does? After the fact, will the oversight mechanisms be able to reverse the actions of Paulson and others? What will be the additional costs of having to reverse some/most of those actions after the fact, if it can even be done?

Given the record amassed by this administration -- and given the record amassed by the most pathetic Democratic Congress ever imagined in this or any other world -- "oversight" and "safeguards" aren't worth shit.

I'm not done. So the central piece of this extortion scheme, the $700 billion check, will be supplied, covered with the blood of Americans. IT WILL BE PROVIDED TO SOLVE A PROBLEM THAT CANNOT BE SOLVED.

Once again, Mike Whitney -- and for fuck's sake, try to get your brain in gear:
The system is at the breaking point, and despite Wall Street's elation from the proposed $1 trillion dollar bailout to remove toxic mortgage-backed debt from banks' balance sheets, the market is still correcting in what has become a vicious downward cycle. This cycle will persist until the bad debts are accounted for and written off or until the exhausted dollar-system collapses altogether.


The problems cannot be resolved by shifting the debts of the banks onto the taxpayer. That's an illusion. By adding another $1 or $2 trillion dollars to the National Debt, Paulson is just ensuring that interest rates will go up, real estate will crash, unemployment will soar, and foreign central banks will abandon the dollar. In truth, there is no fix for a deleveraging market anymore than there is a fix for gravity. The belief that massive debts and insolvency can be erased by increasing liquidity just shows a fundamental misunderstanding of economics. That's why Henry Paulson is the worst possible person to be orchestrating the so called rescue project. Paulson comes from a business culture which rewards deception, personal acquisitiveness, and extreme risk-taking. Paulson is to finance capitalism what Rumsfeld is to military strategy. His leadership, and the congress' pathetic abdication of responsibility, assures disaster.
Bush and the Republicans moved the goalposts and reconfigured the field -- and the idiot Democrats have fallen for it all over again. The Democrats can add all the strings and oversight they want, but they will have provided a monumental amount of money extorted from Americans for generations to come, all to solve a problem that cannot be solved, and with no meaningful method of controlling or directing what happens.

In brief: the Bush administration will get exactly what it wanted all along.

Stupider than shit. That's an insult to shit.


This is your world now. Make yourself at home, and get used to it.

Now Don't Go Slashing Your Wrists or Nothing

So's that none of you go offing yourself or smashing your head into the wall for a few days, I say you just gotta laugh at The Sideshow of the Stupidest Idiots in the History of the Universes, otherwise known as "the government." I love this stuff. Honest, I do.

We got this little example of courage and fortitude on behalf of the "ordinary" American, you know, the ultimate (coerced and extorted) sucker, the big loser in this craptastic funfest. Here you go:
Congressional Republicans had warned against slowing the bailout by tacking on additional provisions, while Democratic leaders urged the administration to use its new role as owner of large amounts of mortgage debt to help hundreds of thousands of troubled borrowers at risk of losing their homes.
Ooohhh, Democratic leaders urged the administration to remember that people actually exist who are not among the administration's vastly wealthy and powerful friends. Of course, they're the Dems' friends, too, so there is that. But there are people in the world with a net worth under $1 million, who maybe live on $30,000 or $75,000 a year? I am amazed. Who knew such people lived on this glorious earth? Anyway, the Democrats will probably put together another "stimulus package," to provide a teensy eensy bit of help to all those "ordinary" Americans, those people whose side the Democrats keep telling everyone they're on. But first the Democrats have to shovel tons of money belonging to "ordinary" Americans and their descendants for the next 20 generations to the wealthiest Americans who got everyone into this mess in the first place. What I said yesterday. I wonder how all this adds up. A hugely increased tax burden for years to come, with all the related weakening effects on the economy generally, versus a little dab of help to those "troubled borrowers..." Hmm. Is the "ordinary" American better or worse off when you put it all together?

Hmm. Oh! He's worse off! You lose! Astonishing!!

I am deeply pleased to note the extraordinarily sophisticated level of analysis being brought to bear:
“We don’t have any choice but to act,” Senator Christopher Dodd of Connecticut, the Banking Committee chairman, said on ABC
Psst, Chris: you always have a choice until you're dead, jerk. And if you're going to "act," make sure you're addressing a problem that actually has a solution. What you and your brainiac pals are doing doesn't begin to qualify.

We don't have any choice but to act! Let's invade Iraq!

We don't have any choice but to act! Let's make sure the economy is largely wrecked for decades to come!

We don't have any choice but to act! Let's bomb Iran! (I'm giving you a preview of Obama-Dem coming attractions. Cuz I'm a swell guy. Feel free to fill in a country other than Iran. Obama and the Dems will probably give you lots of choices, especially with Bomber Joe around.)

You may now dispose of all the books in all the libraries in the world. We don't have any choice but to act! No more thinking, no more analysis, no more understanding required. Chris has the answer! We gotta act, baby!

I love all of the NYT story, but maybe my favorite part is the opening:
Bipartisan support appeared to be emerging Sunday among American lawmakers to approve quickly a vast bailout of financial institutions in the United States. The Bush administration has proposed granting unfettered authority for the Treasury Department to buy up to $700 billion in distressed mortgage-related assets from private firms as part of a program that Treasury Secretary Henry Paulson said “has to work.”

“I hate the fact that we have to do it, but it’s better than the alternative,” Mr. Paulson said on “Fox News Sunday.” “This is a humbling, humbling time for the United States of America.”
I hardly know what to say.

I lied. Fuck you, Hank.

"A humbling time for the United States of America"? I don't think so. It should be a humbling time for people like you, Hank, who created this crisis and are now using it to extort immense sums of money from Americans innocent of all wrongdoing in order to enrich your friends -- precisely those people who have acted like greed-ridden maniacs (since that's what they are) and now demand that the innocent save them. You should be humbled, Hank. You should be so ashamed that you disappear from public life and never open your lying mouth ever again.

And this huge extortion scheme "has to work." More of that sophisticated, high-level analysis. We have to act. It has to work. What if it doesn't work, Hank, baby? What if it makes things much, much worse? What then, sweetheart? It HAS TO WORK. Oh.

And, Hank, c'mon. You don't "hate the fact that we have to do it" -- because we don't have to do it. We don't have to rescue your rotten pals.

Your ruling class. It wins every time. That's the way they set it up. That's the way it works. Yes, with regard to the system as it now exists and will continue to exist, that's the way it has to work. The ruling class has made certain of that. It will not change until the system is fundamentally altered. Not happening.

Aw, heck. I'm sorry for the mean things I said. I love Murka. I love Chris. I love Hank.

I love everybody and everything. Such a great country. Oh, hell. I'm gonna cry now.

Ain't that the truth.

September 20, 2008

A Time Bereft of Heroes

An unusually revealing spectacle is now playing out before us, and an historically rare opportunity. A presidential election campaign occurs just as a major economic crisis unfolds. This is the moment when women and men of great courage make themselves known, particularly if they propose actions that are contrary to those that already appear to have gained wide acceptance. Whether such heroes appear tells us a great deal about the tenor of an age.

Heroes on this scale have appeared very rarely in American life, but they are not unknown. This is part of the story of one such hero:
ON March 25, 1921, at the age of sixty-five, Robert M. La Follette Sr. took the greatest risk of his long political career. Four years after he chose to lead the Congressional opposition to World War I, La Follette was still condemned in Washington and in his native state of Wisconsin as a traitor or--at best--an old man whose political instincts had finally failed him. But La Follette was not ready to surrender the U.S. Senate seat he had held since leaving Wisconsin's governorship in 1906. He wanted to return to Washington to do battle once more against what he perceived to be the twin evils of the still young century: corporate monopoly at home and imperialism abroad.

The reelection campaign that loomed just a year off would be difficult, he was told, perhaps even impossible. Old alliances had been strained by La Follette's lonely refusal to join in the war cries of 1917 and 1918. To rebuild them, the Senator's aides warned, he would have to abandon his continued calls for investigations of war profiteers and his passionate defense of socialist Eugene Victor Debs and others who had been jailed in the postwar Red Scare.

The place to backpedal, La Follette was told, would be in a speech before the crowded Wisconsin Assembly chamber in Madison. Moments before the white-haired Senator climbed to the podium on that cold March day, he was warned one last time by his aides to deliver a moderate address, to apply balm to the still-open wounds of the previous years, and, above all, to avoid mention of the war and his opposition to it.

La Follette began his speech with the formalities of the day, acknowledging old supporters and recognizing that this was a pivotal moment for him politically. Then, suddenly, La Follette pounded the lectern. "I am going to be a candidate for reelection to the United States Senate," he declared, as the room shook with the thunder of a mighty orator reaching full force. Stretching a clenched fist into the air, La Follette bellowed: "I do not want the vote of a single citizen under any misapprehension of where I stand: I would not change my record on the war for that of any man, living or dead."

The crowd sat in stunned silence for a moment before erupting into thunderous applause. Even his critics could not resist the courage of the man; indeed, one of his bitterest foes stood at the back of the hall, with tears running down his cheeks, and told a reporter: "I hate the son of a bitch. But, my God, what guts he's got."

This was the La Follette that his friend Emma Goldman referred to lovingly as "the finest, most inconsistent anarchist" of his time. This was the man so fierce in his convictions that he would risk consignment to political oblivion rather than abandon an unpopular position. The antithesis of the elected officials whose compromises characterize our contemporary condition, La Follette genuinely believed that the inheritors of America's revolutionary tradition would, if given the truth, opt not for moderation but for the most radical of solutions.
The cowards of today who pose as political leaders would do very well to take many lessons from La Follette's story. At this particular moment, one lesson is especially relevant: La Follette won reelection overwhelmingly.

You can read about Robert La Follette, and about another extraordinary man, Thomas B. Reed, here: "No One Is Safe: The Ruling Class Unleashed"; and there is more about La Follette here: "Learn This Lesson Now: How to Fight -- and Win."

A great drama will play out in Washington over the next several days. I should more accurately say, a great drama could play out. It will not. There is not a single national leader who possesses even a tenth of the immense courage and bravery demonstrated by La Follette over the course of many years. In the midst of the collective insanity that led to the United States' entrance into World War I -- a catastrophic decision whose effects the world still feels a century later -- La Follette was almost driven from the Senate as a traitor. Is there a single politician who would take such risks today?

Our culture drowns us in the shabby, the cowardly, the pathetic, and the detestable. Men and women of vision and courage need not apply. If they did, they would almost certainly be destroyed. Those dramas that we witness would embarrass the worst of fifth-rate hacks.

I expect the Democrats to extract certain modifications and perhaps make a few additions to the monumentally destructive plan proposed by the Bush Administration. The final plan may be marginally less awful than in its current form -- but it will remain entirely awful.

Most Americans would not even recognize a La Follette or a Reed if such a person appeared today. And so no such person will appear.

In cultural and political terms, we get what we ask for, and what we deserve. We will get it in spades in the coming week, and in the years to come.

There Is No Fix

That's the truth that almost no one will face about the economic unraveling: There is no fix. This is the fundamental reason I say that, with regard to their publicly proclaimed aims, no one knows what they're doing. They can't know what they're doing -- because, while everyone insists they are trying to "fix it," there is nothing to be done. And yet, everyone in Washington persists in trying to "fix it" -- that is, they are attempting to avoid the inevitable consequences of an economy that has significantly and for a long time gone completely off the tracks. Many actions by many players must lead to certain results now. To rebuild on a solid foundation, the results must play out -- and they will play out, no matter what stop-gap measures are adopted -- and then and only then, a new structure can be erected. The frantic activity in Washington is the hysterical scrambling of terrified and not very bright people faced with unavoidable disaster, still trying to convince themselves and everyone else that "something" can be done to avert catastrophe. This isn't a plan, or even hoping against hope: it's panic, pure and simple.

We can be thankful that in these horrific times, at least we get a lot of Mike Whitney columns. I excerpted two last week -- here and here.

And here are some excerpts from today's Whitney piece:
The system is at the breaking point, and despite Wall Street's elation from the proposed $1 trillion dollar bailout to remove toxic mortgage-backed debt from banks' balance sheets, the market is still correcting in what has become a vicious downward cycle. This cycle will persist until the bad debts are accounted for and written off or until the exhausted dollar-system collapses altogether. Either way, the volatility and violent dislocations will continue for the foreseeable future.

Most people don't understand what happened on Thursday, but the build-up of bad news on the Lehman default and the $85 billion government takeover of AIG, triggered a run on the money markets and a freeze in interbank lending. The overnight LIBOR rate (London Interbank Offered Rate) more than doubled to 6.44 per cent. Bank of America reported overnight borrowing rates in excess of 6 per cent. Longer-term LIBOR rates also rose sharply. On Wednesday, jittery investors removed their money from money markets and flooded short-term US Treasurys for the assurance of a government guarantee on their savings even though interest rates had turned negative which means that their balance would actually shrink at the date of maturity. This is unprecedented, but it does help to illustrate how raw fear can drive the market.

The TED spread (the TED Spread measures market stress by revealing the reluctance of banks to lend to each other) widened and the credit markets froze in place. Borrowing three-month dollars on the interbank market and the U.S. Treasury's three-month borrowing costs widened five full percentage points. That's huge. The banking system shut down.

What does it mean? It means the Federal Reserve has lost control of the system. The market is driving interest rates now, and the market is terrified. End of story.


The problems cannot be resolved by shifting the debts of the banks onto the taxpayer. That's an illusion. By adding another $1 or $2 trillion dollars to the National Debt, Paulson is just ensuring that interest rates will go up, real estate will crash, unemployment will soar, and foreign central banks will abandon the dollar. In truth, there is no fix for a deleveraging market anymore than there is a fix for gravity. The belief that massive debts and insolvency can be erased by increasing liquidity just shows a fundamental misunderstanding of economics. That's why Henry Paulson is the worst possible person to be orchestrating the so called rescue project. Paulson comes from a business culture which rewards deception, personal acquisitiveness, and extreme risk-taking. Paulson is to finance capitalism what Rumsfeld is to military strategy. His leadership, and the congress' pathetic abdication of responsibility, assures disaster. Besides, why should the taxpayers be happy that the stocks of Morgan Stanley, Washington Mutual and Goldman Sachs surged on the news that there would be a government bailout yesterday? These banks are essentially bankrupt and their business models are broken. Keeping insolvent banks on life support is not a rescue plan; it's insanity.
The rest.