The Existentialist Cowboy: scams

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Tuesday, June 28, 2011

The Rise of Fascism in Bush-Perry Texas

by Len Hart, The Existentialist Cowboy

Recently --Texas Gov Rick Perry's boisterous audience of schizoid GOP idiots were caught waving US flags: SECEDE! Perhaps, because of what the GOP has made of it, Texas should secede. By presiding over the deterioration of public education in Texas, the Bush/Perry GOP has created a fascist model in which the profits of huge, right-wing inclined corporations rise as TX educational standards decline; a model in which illiteracy rises concurrently with corporate profits; a model in which the living conditions of millions deteriorate as the lifestyles of a dwindling few grow opulent beyond the ability of even oil barons to imagine.

Texas is about 50 years behind the US. As Bush-Perry neglected education, crime rates rose, most noticeably --murder! Drop-outs account for most, if not all, increases in violent crimes. Minorities --primarily black and Hispanic --are meanwhile disproportionately represented in the Texas gulag system but under represented in the State legislature, the various city councils, and the state judicial system.

Texas is about 50 years behind the US, much more so if compared to Europe. Minorities --primarily black and Hispanic --are disproportionately represented in the Texas gulag system but under represented in the State legislature, the various city councils, and the state judicial system.

Texas was once a Great State and, as a native Texan, I mourn its passing!

Declines in education and jobs are of no concern to the current Governor --Rick Perry, called Governor Good Hair by Molly Ivins, a real Texan, a patriot and brilliant writer. During the Bushy - Hair era, Texas became a gulag state by beating out Mississippi for dead last in high school graduations. A matter of considerable concern among intelligent, thoughtful people but for the axis of Bush-Perry it means more fodder for the corporate owned and run state prison system. The word for this is fascism! There is, in Texas, a corporate gulag of GOP making. One fears that the Texas model will be replicated across America:

subvert public education
exploit the resulting rise in crime to elect more GOP candidates
lock up the victims in corporate-owned prison hell-holes.

That is how Texas became the lab study, the 'fascist model' upon which a fascist state is built. This model is not new. Hitler tried it with concentration camps. The primary corporate beneficiaries were I.G. Farben and Thyssen/Krupp.

These basic fascist principles have inspired movies --good, bad, and ugly. The 'bad' summons up memories of a horrible movie: Judge Dredd, a fascist 'wet dream' in which so-called 'judges', having murdered 'due process of law' could pass sentences on the spot! Fascists, red necks, Bush, Perry were most surely inspired by a single line summing up so many GOP aspirations: “The justice system works swiftly in the future now that they've abolished all lawyers.”

The rise of Fascist-Goppism in Texas was signaled by the constant anti-trial lawyer drumbeat. Soon --trial lawyers will be out of a job and no one will be allowed to present a defense. No problem --Judge Dredd and Gov Perry will just fill up those corporate hell-holes with fresh meat!

Slavery is back! Perhaps it never left! Every fascist dictatorship is preceded with cries of : kill all the lawyers! Depriving them of a profession, a livlihood may be slower but just as effective.

Crimes rates --rising, falling, stagnate --never justify the death penalty. In fact, crime rates invariably increase in death penalty states. States without the death penalty have consistently lower murder rates.

The GOP in Texas might prefer you think they are stupid. Otherwise, you might conclude that because these facts may be easily obtained and verified that their heinous policies were chosen --not out of GOP incompetence --but deliberately for the purpose of filling up the prisons, thus enriching the corporations which own and run the prisons.
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The death penalty is medieval, barbaric and ineffective. Throughout history, the death penalty has failed to deter crimes of any sort. There is, therefore, no rationale for the state murder of anyone accused of any crime. Increasingly fewer cases are 'proven' beyond a 'shadow of a doubt'. A disproportionate number are arrested for the crimes of being black and/or poor.

States Without the Death Penalty Have Better Records on Homicide Rates

A new survey by the New York Times found that states without the death penalty have lower homicide rates than states with the death penalty. The Times reports that ten of the twelve states without the death penalty have homicide rates below the national average, whereas half of the states with the death penalty have homicide rates above. During the last 20 years, the homicide rate in states with the death penalty has been 48% - 101% higher than in states without the death penalty. "I think Michigan made a wise decision 150 years ago," said the state's governor, John Engler, a Republican, referring to the state's abolition of the death penalty in 1846. "We're pretty proud of the fact that we don't have the death penalty."

--New York Times, 9/22/00, Death Penalty Information Center

Texas, notably, has not occupied a position of prominence with regard to petroleum production since it was discovered that bombing Iraq and killing civilians there was much, much cheaper than is the secondary recovery of oil. Why spend millions exploring for oil when you can just steal fields that are already productive? The cost of bombing the crap out of the oil's rightful owners?? Hell --the taxpayer is stuck with that tab!

Because of rapacious oil development, the neglect of education and the hubristic disregard for human rights and environment, so-called 'free enterprise' has robbed millions of children of a decent education and as many poor of justice in a state ruled by goddamned liars, elites and their ass kissers: the GOP!

Texas --Bush style --provides the residents of Texas with some of the nation's very worst crime and incarceration rates;
Texas subjects the residents of Texas to deteriorating air quality and wanton ecosystem destruction;
Texas can boast of the nation's very worst murder, crime and incarceration rates!
Texas --a state that now leads the nation in pollution, crime, and illiteracy --should be studied by any other state wishing to avoid a similar disastrous fate.

Fascism --now dominating the political and cultural life of Texas --spawns crime and creates the conditions in which it is nurtured and thrives and, worse, benefits the GOP and its corporate sponsors.

Still, most people are now ashamed to admit that punishment is based on vengeance and, for that reason, various excuses and apologies have been offered for the cruelty that goes with it. Some of the more humane, or “squeamish,” who still believe in punishment, contend that the object of this infliction is the reformation of the victim. This, of course, cannot be urged of the death penalty or even punishment for life, or for very long-term sentences. In these cases there is neither inducement to reform nor any object in the reformation. No matter how thorough the reform, the prisoner never goes back to society, or he returns after there is no longer a chance for him to be of use to the world or to enjoy life.

--Clarence Darrow, Crime: It's Cause and Treatment

Tea Baggers are Scumbaggers!

If there is a real and widespread desire among Texans to secede, then, by all means, secede. But in fact, I believe secession talk is just another right wing smokescreen with which it exploits its base and deceives otherwise good citizens of Texas!

Power may corrupt, and absolute power may corrupt absolutely, but in the comics Judge Dredd is basically Dirty Harry on Overdrive, an incorruptible lawman obsessed with The Law and Justice. The official plot synopsis of the 1995 movie swallows the official line too: “In the Third Millennium a powerful and efficient hybrid of the police and judicial system has given birth to group of new guardians of the law with the power to dispense instant justice and punishment. These judges are law enforcer, jury and executioner. One of these judges, Judge Joseph Dredd is a living legend - six feet of armored justice with no outside interests besides his devotion to enforcing the law.” Why anyone would however want to make a sequel or (bullshit Hollywood jargon coming up) “re-imagining” of Judge Dredd is a bit of a mystery. The original film disappointed at the box office and made a mere $113 million world-wide. Audiences who didn’t know the character beforehand were baffled. “Considering that the movie was adapted from comic books, the least we should expect is a juicy battle between good and evil,” Anthony Lane wrote in The New Yorker, “but the conflict is, in fact, a matter of fine distinctions between shades of Fascism.”

--FROM PAGE TO SCREEN: JUDGE DREDD (2012)

Fascist Bullshit: "I AM the law!"

Sunday, June 20, 2010

Right Wing Scams: 'Why Don't You Start Calling Me Gordon?'

by Len Hart, The Existentialist Cowboy

All but forgotten now, Enron --it's rise and calamitous fall --dominated front pages and sucked up airtime until knocked out of contention by 911. As I was reminded, it was the ghost of Gordon Gekko, brilliantly portrayed by Michael Douglas in 'Wall Street', who both presaged and haunted the fail of Enron and all those who served it or were temporarily enriched by its corporate shams and schemes.

As was the case in the 'Roaring Twenties', fortunes were lost in a heart beat, economic empires collapsed in the blink of an eye. Enron was one of them. Conveniently for the new Bush administration, indeed, the GOP itself a crime syndicate, corporate 'person-hood' benefited from a timely stay of execution -- 911.

Wall Street was one of Hollywood's more pertinent parables even if the name "Gekko" was a bit obvious. Real Gekkos (spelled Gecko) make fairly good pets --or so I am told! They eat roaches. And of late there are no shortage of roaches. The largest roach colonies are found in Washington D.C., Austin, TX, K-street or Wall Street --all sites of irradicable infestations. As we have seen, the GOP eats it own.

Opportunities for metaphor and analogy are endless and every comic needs a foil. Had there been no crooks or idiots, the careers of Voltaire and Mark Twain would have been much less brilliant. We owe a great debt to totalitarians, snobs, goppers, corporate crooks, Bush's surrogate torturers and would-be dictators. Where would Stephen Colbert be without them? Alas, the blog-o-sphere would be scrambling for material.

Enron was run by a gang that most certainly thought that, being "captains" of "industry", they could just pull out and disappear. I suppose every crook thinks that they will get away with it.

Enron will prove to be one of the most important episodes in the history of American business, and its story, from beginning to end, is inseparable from Ken Lay, its founder and long-time chairman. Thus, what people make of Enron—and what lessons they draw from it—will depend to a considerable degree on how they understand Lay.

As I’m sure you know, Enron has to date been blamed largely on free-market politicians, heartless corporate managers, and an egoistic chairman. In fact, as my book will show, Enron relied heavily on government favors, was run by postmodernist managers, and had as its chairman the kind of person Ayn Rand would have called “a second-hander.”
--On the Fall of Enron and Ken Lay: 'Philosophical Fraud' at an Errant Energy Company (and cap-and-trade, renewables forerunner), Robert Bradley Jr.

The US is, likewise, a financial shell. When GM, at last, is swallowed up by a foreign auto maker, what incentive will the new entity have to employ American workers when they can do just as well in Japan or Malaysia or China?

We have become a nation of consumers lent money by China so that we can buy goods manufactured in China. We are cattle, cows to be milked. When the teat runs dry we will be abandoned to third world status if we are not already.

In the meantime, the Bushies and other GOP Geckos will have run off with the last scraps of US wealth if they have not done so already. See the CIA's World Fact Book which lists the U.S. at the very bottom of the list with the world's largest negative Current Account Balance, formerly called the 'balance of trade deficit'. China tops the list with the world's largest POSITIVE Current Account Balance. Every banker can equate that with his own balance sheet and conclude that China, because of the policies of the GOP, now owns America if not the entire world.

The house of cards appears to have fallen --but not just yet! Like Ken Lay, Bush and his gang are most surely clinging to the belief that, unlike Lay, they will get away with it. Chances are good that Bush will live out the rest of his wasted life too stupid to regret a damn thing! It is this luxury, available only to the stupid, that I resent most!

Iraq was a big screw up. The invasion and theft of Iraqi oil was supposed to bail them out. Things have not quite worked out as planned. Then again, perhaps they have exceeded Bushco expectations. They are not yet jailed nor executed for capital war crimes (see: U.S. Codes, Title 18, Section 2441).

Just as Hitler thought he had learned from Napoleon's mistakes, Bush most certainly thought he had learned from Hitler's.

Saturday, December 06, 2008

'I have a scam': the Real Cause of Impending, Utter Financial Collapse

by Len Hart, the Existentialist Cowboy

That there is gold in Ft. Knox may be a popular myth. Then again it could be just another bald-faced lie, a hoax, a callous, criminal fraud like 'supply side, trickle-down' bailout economics! I say: NO bailout for the banks, NO bailout for the fat cats and other 'capitalists' who created this mess, NO bailout that lets the GOP off the hook! No bail out for auto makers who have never listened to the public. Screw the banks and to hell with Wall St! What we need is a bailout for the people!
Gold was said to be moved --literally --from an 'asset' side to the 'debit' side of the building. The US has been running a balance of trade deficit for years. One wonders --is there any gold left to be plundered or liquidated.

Yet, today evidence is starting to accumulate that even though the gold in Fort Knox is all physically present and accounted for, the problem is that it may no longer belong to the United States. And it all comes as a consequence of the Treasury’s declared 30-Year War on Gold (which began in earnest when the gold window, allowing the redemption of dollars in gold, was closed in 1971). Since the 1960’s, the Treasury and the Federal Reserve Board have employ a range of strategies to try to minimize the role and importance of gold:PERSUASION.

The Treasury, in an effort to defend the dollar, has long "talked down" the role of gold in modern monetary systems. This disparaging of gold as a ‘barbaric relic’ is a longstanding and perfectly defensible behavior on the part of the US Treasury. COERCION- Facilitating and encouraging sales and lending of gold by other countries, gold-holders, and mines in order to maintain an atmosphere of "oversupply" of the metal goes one step further.

--Whose Gold is it at Fort Knox?

Ancient Rome, likewise, ran out of 'gold', one of a handful of 'metals' that are said to have intrinsic value. At the time, Roman 'sesterces' were only good enough to get you into the bath houses or 'free' gladiatorial contests in the Coliseum. Rome invaded Dacia because it was desperate for Dacia's gold. Likewise, Bush, upon the fraudulent pre-text of 'terrorism', invaded Afghanistan for its natural gas reserves and Iraq for its oil. Don't tell me that you believe Bush's 'fairy tales' and outright bullshit!

'Every situation is different', alright! Rich folks get their asses kissed! Poor folk get their assed KICKED! Right out of their homes!

It involves building a cheap but impregnable cinder block building in my back yard and, upon completion, I announce to the world that I have several million gold bars (or more) warehoused in it. How far do you think I would get if I went to my local Maserati dealer and offered him/her the following proposition: "you let me drive that beautiful, shiny red Maserati sport model off your lot and whenever my payment comes due, I will move 'X' amount of bullion from one end of my cinder block building to another and put your name on it?" If he/she goes for it, I might offer a similar deal to my realtor/developer: "if you let me move into that $15 million estate I will move some bars from one end of my cinder block box and put your name on it!"

I'm on a roll!

And somewhere along the way, I've accepted 'depositors' eager to get in on it. Some enterprising folk have actually propositioned me: you move a bar and put my name on it and I will give you the use of cold hard cash in the meantime. Cool! Now I'm in the banking business. Just call me 'Fed'.

I might be emboldened to approach the 'operators' who hold the mortgages on the TCB Tower in downtown Houston. I offer to take ownership of that 'paper' and, in return, I will move an agreed upon number of gold bars from one end of my cinder block building to the other and put the tag, TCB, on it! I might repeat this 'procedure' in downtown LA, Century City, Chicago, Manhattan! I like the more stately buildings like Empire State or Chrysler.

Peanuts!

I have bigger things in mind. What if I can scam ..uh...deal with those folk who hold the national debt of the US? Russia? China? India? Great Britain? After all, my cinder block building is very, very big!

Catastrophe!

My neighbors get suspicious. One of them jumps over the fence and bores a hole through my cinder block building. What the fock!! He reveals to the whole world that there is nothing in my cinder block bunker but cheap clay bricks that I have spray painted gold!

The whole house of cards collapses and the world is plunged into another 'great' depression!

Now this is all just a 'parable' --the parable of the cinder block scam! There are several lessons in every parable, even stupid ones. It is not 'gold' that backs up currency; it is confidence. Gold itself has value only as long as people want or need it. Both gold and silver have practical value as they are used in electronics applications. But what if they were not? What if the use of gold and silver for decorative or esthetic purposes was no longer fashionable? What if there was absolutely nothing that could be depended upon to back up paper currency? Ultimately, the only thing that really backs up currency of any type --even cinder block scrip --is simply: confidence. When people no longer have confidence in either the currency or the system, the system itself collapses.

Bottom line

People the world over have not just now discovered that there is not enough gold to back up US currency and/or obligations. It was Nixon who revealed the fact that the US didn't have enough money in Ft. Knox to cover its obligations. Some creditor nations had wanted to be paid in gold and the US refused. If there is any gold in Ft Know it will not prevent the collapse that is already well underway.

The amount of gold in Ft. Knox is estimated to be about $250 billion --a drop in the bucket. While even the Fed will concede that gold is 'true money' it is so only because people are willing to accept it. Goldfinger's plan to collapse the world economy would have failed. It would not have created the panic that is underway today. Rather, a world wide financial collapse is due not to the loss of gold but the complete loss of confidence in the capitalist/imperialist system.

Next episode: Why Karl Marx was right and telling the truth; George Bush is a lying sack of shit!

Who caused the great crash of 2008?

Original article, subheaded Lee Sustar analyzes the roots of the worst economic crisis since the Great Depression--and shows why Marxism offers the best way of understanding what went wrong, via Socialist Worker (US):

THERE ARE plenty of people who should be held accountable for turning an ordinary recession that began a year ago into a global catastrophe.
Sustar then goes and identifies some of the main culprits: Angelo Mozilo (Countrywide), George Bush, Henry Paulson, Phil Gramm, Robert Rubin (who comes in for particularly harsh criticism), Alan Greenspan (who is presented as the rogue who is the founder of our current economic feast). A rogues' gallery if there ever was one. It seems strange that Robert Rubin is one who our soon to be dear leader has called upon to lead us out of this mess, doesn't it.
Topping the list is former Federal Reserve Chair Alan Greenspan, who fed the bubble by keeping interest rates at rock-bottom levels, urging home buyers to take on adjustable-rate home loans and refusing to use the Fed's powers to oversee a mortgage industry rife with fraud.
The Maestro! I'm sure he wishes he would have died before this economic collapse. My guess, though, is that somehow his reputation amongst the masses won't be too tarnished. After all, it looks like we're going to continue the same basic economic policies under our soon to be dear leader as have been followed for the past 30-40 years. What fun!

While reading Sustar's listing of the bad (Bubba included), it's the bulk of the article which you may want to pay attention to. There, he looks at how Marx analyzed the Capitalist system and its failings, and offers a Marxist perspective on how things might get turned around. Now, even if you don't accept the Marxist perspective, it is worth your time so you can have another layer of knowledge as you slog your way through this economic crisis.

--All Over the Board: Who caused the great crash of 2008?

More about how the government of the United States has BETRAYED YOU:

The swindle of the system is simple. The Federal Reserve Bank hires the US Treasury to print up some money. The Federal Reserve only actually pays thetreasury for the cost of the printing, they do NOT pay $1 for each 1$ printed. But the Federal Reserve turns around and loans out that money (or credit line) to banks at full face value, those banks which have exhausted their deposits then loan that Federal Reserve fiat money to you, and you must repay it in the full dollar value (plus interest) in work product, even though the Federal Reserve printed that money for pennies, or created it out of thin air in a computer.

As the Federal Reserve overprints more money, the money supply inflates, and too much money starts chasing too few goods and services, which means prices go up. But contrary to the charade put on by the Federal Reserve, inflation doesn't just come and go due to some arcane sorcery. The Federal Reserve can halt inflation any time it wants to by simply shutting down those printing presses. It therefore follows that both inflation and recession are fully under the control of the Federal Reserve. This means the cycle of inflation and recession is an intentional one; a gigantic heartbeat that pumps paper certificates out to the working class, while pumping real wealth in to the owners of the banks.

Over time, that excess of printing has destroyed the value of that dollar you think you have. If you want to know by just how much, go out and try to purchase 371.25 grains of silver right now. Usually, the deterioration is gradual. Sometimes, it has to be obvious, such as the 1985 devaluation (done to halt the trade imbalance) which triggered the Japanese real-estate grab in this country.

Many politicians have attempted to reverse this process. John F. Kennedy issued an Executive Order 11110, requiring the Treasury Department to start printing and issuing silver certificates for the silver then remaining in the US Treasury.

Kennedy decided that by returning to the constitution, which states that only Congress shall coin and regulate money, the soaring national debt could be reduced by not paying interest to the bankers of the Federal Reserve System, who print paper money then loan it to the government at interest. This was the reason he signed Executive Order 11110 which called for the issuance of $4,292,893,815 in United States Notes through the U.S. Treasury rather than the Federal Reserve System.

John F. Kennedy's United States Note.

That same day, Kennedy signed a bill changing the backing of one and two dollar bills from silver to gold, adding strength to the weakened U.S. currency.

Kennedy's comptroller of the currency, James J. Saxon, had been at odds with the powerful Federal Reserve Board for some time, encouraging broader investment and lending powers for banks that were not part of the Federal Reserve system. Saxon also had decided that non-Reserve banks could underwrite state and local general obligation bonds, again weakening the dominant Federal Reserve banks".

Kennedy's E.O. was never implemented following his assassination, and shortly afterwards, United States silver coins were taken out of circulation and replaced with the copper clad slugs in use today. These two events, the failure to print new silver certificates, and the substitution of worthless slugs for our silver coins, may explain why the Warren Commission included on its panel John J. McCloy, a man with no experience in crime, law enforcement, or national security, but who had been the President of the Chase Manhattan Bank.

It should be noted that the banks themselves are still using the gold standard. Accounts are still settled between major national banks by the transfer of gold bullion.

So here we are with a bank that legally counterfeits the money you borrow but expects a full value (plus interest) repayment. But what's good for the Federal Reserve is good for the government itself, and this is where we get back into that funny word "deficit spending". The government spends more money than it takes in. It has for many years now. The Federal Reserve, being the only lawful source of this fiat money, prints up the excess cash the government needs (or manufactures a credit line in a computer). This extra cash is treated as a loan, in order to keep the government overspending from further eroding the worth of the dollar in the world market. The government (meaning the taxpayers) is on the hook for the full face value, plus interest.

But there's another problem. The government is borrowing so much money that it drives the interest rates up! You pay MORE interest on your mortgage, car loan, and credit cards, because the government cannot balance its books. That extra interest you pay is therefore another hidden tax. The government, in its "generosity", gives you a tax credit on mortgage interest that is higher because of their own borrowing!

During the 80s, as exports dropped, and jobs moved from manufacturing to lower paying "service sector" jobs, the US tax base declined. In order to keep the jobless rate from rising, a massive defense program called the Strategic Defense Initiative was cranked up, but since this program produced no exportable product, it produced no taxable sales revenues, and hence the money poured into the project accelerated the government decline into debt. Because manufacturing was on the decline, fewer start-up companies were approaching the lending institutions, so the government loosened up the rules (while increasing the insurable deposit limit) to allow "investments" in more high risk ventures, most of which turned out to be frauds, or worse, money laundering operations for drug criminals. This includes Whitewater, Flowerwood, and Castle Grande. Despite shifting the S&L loss primarily onto the taxpayers (to reassure foreign investors that the taxpayers still made America a safe place to park their surplus cash) the government plunged further into debt.

In the 12 years of the Reagan/Bush(I) administrations, the United States went from being the world's largest creditor nation to the world's largest debtor. Many of those nations which had enjoyed huge trade surpluses started loaning that profit back to the United States with the stipulation that we work on our manufacturing, clean up our infrastructure, raise taxes, in short, clean up our act, so that investment in America makes sense!

However, we didn't quite do that.

There has been some shuffling around to try to conceal the real scope of the problem. Over the last several years, the Federal Government has been sending less tax money back to the states than it takes in in taxes. This means that the states have to borrow MORE money to cover their obligations. The net result is that the debt is being transferred to the states, to conceal its true size. The government will easily admit to a $3 trillion "publicly held" debt, grudgingly concede that it's "unfunded liability" brings that number to almost $7 trillion, but the real hard truth is that total government debt, state and federal, is now over $14 trillion dollars, or about 50,000 for every man, woman, and child inside the United States. Since 1960, the taxpayers have shelled out $15 trillion in interest payments alone, while the principal continues to rise.

Yet another stunt the government has pulled is to "borrow" from the various trust funds under its control. Some $2 billion has vanished from the trust accounts of Native Americans (presently suing the Departments of the Interior and Treasury), and nearly ¾ of a TRILLION dollars has been removed from your Social Security retirement trust fund and spent in the last 8 years.

If the government has to borrow your retirement money when things are supposed to be so good, under what conditions can it repay the money? Or is that government IOU in your retirement account merely a promise to either tax you a second time or stiff you on the benefits you thought you were paying for?

In the last 8 years, during what are supposed to be record setting good times, the Federal government has nearly DOUBLED its debt load. The estimated interest on the debt equals all the personal income tax paid by al Americans. Our government is so deep in debt that it cannot get out.

---The United States Is In Deep Doodoo!

Friday, September 26, 2008

What if the GOP Had Let Wall Street 'Privatize' Social Security?

For years the GOP, the demagogue John McCain and the Bush administration have looked at Social Security and licked their greedy chops! Now is the time to ask: what if these greedy GOP bastards had privatized Social Security?? The quick response: millions of retirees would be facing starvation or the FEMA camps!

Social Security was targeted not because it was a failure or because it was broken as we were repeatedly told. It was targeted because it was a success --in fact, Social Security was and remains the government's ONLY unqualified success. Certainly --it could have been depended upon to further enrich the fat cats at your expense.

In the meantime, Wall Street and the GOP blackmail the nation: bail out the robber barons or face the collapse of the dollar when, in fact, the bailout itself threatens catastrophic hyperinflation i.e, the utter collapse of the buck.

Economist Michael Hudson: the bailout is a giveaway that will cause hyperinflation and dollar collapse
Bailout talks stall as Bush meets with Congressional leaders and Presidential candidates. German Finance Minister says US will no longer be the financial Superpower. French President Sarkozy says the days when "the all powerful market is always right are over". The Real News Network spoke to economist and historian Dr. Michael Hudson who says that it's not a "bailout" but a "giveaway" and will create a new kleptocracy of billionaires.

Dr. Michael Hudson is a Wall Street financial analyst and historian. Dr. Hudson was Dennis Kucinich’s Chief Economic Advisor in the recent Democratic primary presidential campaign, and has advised the U.S., Canadian, Mexican and Latvian governments, as well as the United Nations Institute for Training and Research (UNITAR). A Distinguished Research Professor at University of Missouri, Kansas City, he is the author of many books, including Super Imperialism: The Economic Strategy of American Empire and of Super-Imperialism and of The Myth of Aid .
--Once in a Century Rip-Off

GOP attacks on Social Security was party's first phony crisis, perhaps a dry run for the current bailout.

To save Social Security, Bush wants to destroy it -- replacing government-guaranteed retirement benefits with private accounts that will be subject to the whims of the stock market. It's an expensive plan. Allowing workers to divert even a small portion of their payroll taxes into private investments, as Bush is proposing, would require the government to borrow at least $2 trillion to make up the immediate shortfall. It's also completely unnecessary, according to Paul Krugman, a prize-winning professor of economics at Princeton University. In a blistering series of columns in the New York Times, Krugman has marshaled the economic data to show that Social Security is not only solvent, it's in much better financial shape than the rest of the federal government. "The people who hustled America into a tax cut to eliminate an imaginary budget surplus and a war to eliminate imaginary weapons," Krugman wrote recently, "are now trying another bum's rush."

At his tree-shaded home in Princeton, New Jersey, Krugman took a break from working on a new economics textbook to explain why the crisis is phony -- and what's wrong with Bush's plan "to convert Social Security into a giant 401(k)."
What would you say to college students and young workers who are convinced they'll never see a dime of the money they put into Social Security?

You've been sold a scare story. Right now Social Security has a large and growing trust fund -- a surplus that has been collected to pay for the surge in benefits we'll experience when the baby boomers start to retire. If you're twenty now, you'll be hitting retirement around 2052. That's the year the Congressional Budget Office says the trust fund will run out. In fact, many economists say it may never run out. If the economy continues to grow at an average rate, the trust fund could quite possibly last forever.

But what happens if it doesn't?

Even if the trust fund does run out, Social Security will still be able to pay eighty percent of promised benefits. The actual shortfall would be a pretty small part of the federal budget, quite easily made up from other sources. Once the whole baby-boomer generation is into the retirement pool, Social Security's share of the gross domestic product will only increase by about two percent. Well, President Bush's tax cuts are more than two percent of GDP -- and they're happening right now, not fifty years from now. So the idea that there's this Social Security thing that is a huge problem is just wrong.

But if the trust fund does run out, the government would have to raise taxes or cut benefits, or some combination of both, to keep Social Security solvent.

Yes, if the trust fund is ever depleted, then something will have to be done. But you need to have some perspective on the seriousness of this whole thing. On the day the trust fund is exhausted, Social Security revenue will cover about eighty percent of the cost of benefits. Right now -- today -- if you look at the U.S. government outside of Social Security, revenue covers only about sixty-eight percent of total government spending. So on the day the trust fund is exhausted, forty-seven years from now, Social Security will be in better financial shape than the rest of the U.S. government is today.

So if there's no crisis in Social Security, why is President Bush pushing so hard to privatize it?

It's politics. Since the days of Barry Goldwater, the Republican right has really wanted to dismantle Social Security. And now they have a degree of political dominance that lets them push it to the top of the agenda -- even though no rational analysis of the actual problems facing the U.S. government would say that it belongs there.

Why do they want to dismantle it?

It's hard to understand why anyone would want to return us to the days before the New Deal, when millions of elderly people lived in poverty. But if you really dislike the notion that the government provides a safety net for the poor, then Social Security is the prime target. The U.S. government is a big insurance company, with a side business in national security. Social Security is the biggest social-insurance program that we have. It's been highly successful, and it's extremely popular. It's one of the things that makes people feel somewhat good about government -- and so, therefore, it must go.

And some people stand to profit from abolishing it. Wall Street poured a lot of money into both of Bush's campaigns, hoping he will divert Social Security into the stock market.

That's a factor, but I don't think it's the reason behind it. Attacking Social Security is a lot like attacking Iraq -- just because a lot of people stood to get lucrative contracts from it, that doesn't mean that's why they did it. If you privatize Social Security, there's going to be a tremendous amount of income for the mutual-fund industry. That's one reason there is a constituency for this on Wall Street. And that's one of the important reasons why this is really gonna work very badly.

What do you mean? Those who are pushing privatization say that our financial markets are one of our greatest strengths -- that private investment will work better in the long run than government-managed accounts with lower rates of return.

There are two problems with that. First, the fees charged on private accounts will be a significant drain on returns. In a typical portfolio, we're probably looking at a return of four percent. But fees are likely to take at least one percent, like they do in Britain. So now we're down to a return of three percent or less on private accounts. And since Bush wants to borrow $2 trillion to pay for the transition, we're talking about borrowing at interest rates of three percent to establish private accounts that will yield three percent -- with a lot of additional risk. So it's a lose-lose proposition, except for the mutual-fund industry.

The second problem with the market is that some people -- probably many people -- will end up getting much less than they would have under the current system, depending on which funds they pick and how the market does. A lot of people will hit age sixty-five with very little in their private account -- and that means a big return of poverty among the elderly, which is exactly what's happening in Britain right now. As a result, the government will have to step back in and rescue people. We'll have more suffering and bigger bills. People will ask: Where did all that money go? The answer will be: It basically went into mutual-fund fees.

But what if stocks do well? Isn't it possible that privatization would work?

The only possible way that stock returns can be high enough to make privatization work is if the U.S. economy grows at three to four percent a year for the next fifty years. But Social Security's own trustees expect the economy's growth rate to slow to 1.8 percent. If that happens -- if their own assumptions are correct -- then privatization would be a disaster. And if that doesn't happen -- if the economy continues to grow at a steady rate -- then the trust fund is good for the rest of the century, and we don't need privatization.

In selling the idea that there's a crisis, Bush has a lot of powerful words on his side: "choice," "freedom," "ownership society." What words do you have to counter his sales job?

Scam. Three-card monte. I've been thinking a lot about flying pigs. The privateers are claiming that you can have something for nothing. They're basically saying, "Let's assume that pigs can fly." And when you say, "You know, it's not good to assume that pigs can fly," they respond by saying, "What's wrong with you? Don't you understand the enormous advantage of flying pigs?"

The only reason they talk about how wonderful an ownership society would be is because we managed to win the battle over the word privatization. The Cato Institute -- which is the intellectual headquarters for all this stuff -- founded something in 1995 called the Project on Social Security Privatization. But focus groups don't like that word, so in 2002 they changed the name to the Project on Social Security Choice. They didn't announce a name change -- they just went back and scrubbed their Web site, so there's no indication that it was ever called "privatization."

If there's no crisis in Social Security, why aren't the Democrats saying that more clearly and forcefully?

There's a lot of timidity. They're desperately afraid of seeming like "Oh, well -- we have our heads in the sand, and we're not active." I would like to see them step up to the plate and say that these claims that we're going to have a crisis sometime in the next fifteen years is just garbage. Bush is handing them an opportunity by making this the centerpiece of his agenda. Democrats should treat privatizing Social Security the way Republicans treated Clinton's health-care plan -- they should say, "This is a disaster, and we will stand against it." Social Security is simply not the biggest problem facing the government today.

What is?

If you really want to get scared about something that can happen between now and 2052, you should talk about Medicare and Medicaid. The entire system of private health insurance is gradually collapsing. And as the share of people getting medical insurance through their employers continues to decline, the number of people who have to rely on the government for health insurance keeps going up. At the same time, medical costs keep on rising, because doctors keep on figuring out new stuff to do -- procedures that didn't exist ten or twenty years ago.

So what needs to be done to shore up Medicare?

In our system, we have huge administrative costs -- which are mostly driven by insurance companies spending huge amounts of money trying to avoid covering people. Our health-care costs are eighty percent higher than those in other advanced countries. The best way to contain those costs is to go to a single-payer system, one in which the government insures everyone. That would probably cut the cost of health care by at least twenty-five percent.

But there's no way that will happen under Bush.

He actually wants to do the opposite. If he manages to privatize Social Security, he'll try to privatize Medicare next. He'll try to strip away guaranteed health care and turn it into some kind of system of individual health accounts. The right says that what we need is more choice, more competition. But every piece of evidence suggests that health care is an area in which privatization actually raises costs. If they succeed at dismantling both Social Security and Medicare, then you're pretty much back, on domestic policy, to the days of Warren Harding -- which is exactly where they want to go.
--The Fake Crisis: Economist Paul Krugman explains Bush's latest con -- social security

We have been lucky so far to have beaten GOP attempts to let Wall Street insiders steal your Social Security, steal your retirement prospects. If the GOP is not decisively discredited, exposed to be the endemically crooked party that it is in fact, we might not be so lucky in the future. Increasingly --the future is now.