Monthly Archives: April 2012

In a four part series on the naked capitalism blog, Morgan Sandquist, a member of the Occupy Wall Street Alternative Banking Group, presents us with a narrative that parallels the addiction of a drug addict with those actions of the financial industry that has engaged in irrational behavior, not unlike someone who is high on crack cocaine.

The financial industry’s quest to create greater riches for themselves and all hangers-on appears to be the only motivating force behind their actions that led to an economic apocalypse in 2008 that not only cost taxpayers in terms of monetary value ($100 billion in bailouts at a bare minimum) but the long-term effects of “unemployment, business failures, reduced government services, particularly at the state and municipal level”, that according to Andrew Haldane of the Bank of England, amounts to astronomical costs “lying anywhere between one and five times annual GDP. Put in money terms, that is an output loss equivalent to between $60 trillion and $200 trillion for the world economy”.

In his first essay on Finance in Denial, Sandquist notes the similar characteristics between all addicts:

Anyone investigating the true health of the banking industry, apparently including regulators, is faced with opacity, complexity, and even outright hostility that stymies all but the most savvy and persistent. Fortunately, people within OWS, including the Occupy the SEC Working Group, are that savvy and persistent. But the reaction of the industry and its partisans to such efforts has included the not-so-subtle suggestion that inquiring into the well-being of the banking industry will somehow cause problems to arise that wouldn’t otherwise exist if we would all just mind our own business.

This seems odd in an ostensibly objective and quantitative context like banking. Shouldn’t the truth be clearly visible in the accounting? Shouldn’t we all–borrowers, investors, depositors, and regulators–want to know exactly what’s going on?

As unexpected as such a visceral and irrational reaction to genuine, well-founded concern is from the supposedly rational realm of finance, that telltale blend of evasion, grandiosity, and superstition will be familiar to anyone who has ever confronted an addict about his or her addiction.   (emphasis mine) SOURCE

Having read the first 3 parts published thus far by naked capitalism has been an eye opener as I watch those in the financial industry and their “enablers”,  who I refer to as the “what’s wrong with being rich” crowd.   One of those enablers is currently running for President of the United States.  Mitt Romney, the venture capitalist who is part of the wealthy one-percent in this country, has shown over and over again that his reactions reflect those of the wealthy elite rather than one who shares a common interests with most Americans; the very people he wants to represent as our next president.

Beware the "money pushers"

The most recent evidence of this irrational behavior from the GOP presidential hopeful was recorded as he spoke to students at Otterbein University in Ohio last week in a campaign move to attract the young voter bloc who voted overwhelming for Obama in 2008.  Watch his body language too as he talks about his penchant for something that is masked as part of the “American Dream”.  His rapid back and forth glances at the audience and jittery movement with his hands is reflective of someone trying to conceal what he really wants his audience to buy into – creating greater debt so people like Romney can get their fix.

When Romney tells his young audience that “This kind of devisiveness, this attack of success, is very different than what we’ve seen in our country’s history”, he’s not referring to any objective based premise.  This kind of comment is the typical red-herring message sent out by the right that attacks people who legitimately question the failures we witnessed recently of the free market and why those government regulations were removed by elected officials meant to keep abuses in check.   It’s also typical of the addict that tries to redirect the conversation when their addictive behavior is being brought to their attention by concerned individuals.  Sandquist notes this pattern of behavior in the first part of his series.     

Denial denies not just claims and assertions, it also denies access and insight into the reality of addiction. …  It denies the story of addiction and proposes an endless collection of counter-conspiracies.

In his next line, Romney clearly replicates the vernacular of a drug pusher who’s eager to get his target to experience the drug high of wealth.  We’ve always encouraged young people: Take a shot, go for it, take a risk, get the education, borrow money if you have to from your parents, start a business.   In Part II – The Addiction, Sandquist shares some historical perspective with us:

… money is created as debt, its use to finance productive activity means that that activity, whatever it is, must then generate interest to be returned to money’s creators in addition to the money lent.

This has given rise to an industry, even a class of people, that derives its livelihood not from any productive activity of its own, but merely from having money. … There is no logical end to what must be monetized–natural resources, ideas, time. Nothing can remain unowned and clear of liens, and that will eventually consume any finite realm.

Romney is part of that “class of people, that derives its livelihood from … merely having money”.  He is thus compelled to create further interests by others to seek financial aid so that his own addiction can be sustained.

The dynamics of usury-money are addiction dynamics, requiring an ever-greater dose (of the commons) to maintain normality, converting more and more of the basis of well-being into money for a fix. If you have an addict friend, it won’t do any good to give her “help” of the usual kind, such as money, a car to replace the one she crashed, or a job to replace the one she lost. All of those resources will just go down the black hole of addiction. So too it is with our politicians’ efforts to prolong the age of growth. – Sacred Economics, by Charles Eisenstein

 

Public sector “Enablers” repealing Glass-Steagall, making it easier for addicts to fall deeper into their obsession

With such a perspective, how far removed is Romney from the chemical drug pusher as he stands in front of this college crowd encouraging them to engage in activities that experience has yet to qualify most of them for.  Not that those who have entrepreneural savvy should be discouraged.  But what percentage of all college students truly have the know-how to create a business model that can successfully organize, fund and promote a business venture?  How many of those who can have the devotion and energy to see it through?

Wealth to most of them is the surface image of material possessions, not the labor and love of what your doing and how society benefits as a whole. Caution has been thrown to the wind because as Romney entices his young minions there is no mention of the down side to financial addiction such as more businesses fail then succeed and the increase in bankruptcies that occur from risky endeavors brought about by the addictive high for even more wealth.  Ancillary to such negatives too are jail time and broken families.

The naked capitalism blog has released part three of Sandquist series (see link below) that deals with Intervention.  His recommendation that we go slow in aiding the financial addict to seek rehabilitation is questioned by naked capitalism’s creator Yves Smith.

While I applaud the general thrust of this series, I have to take issue with one notion that this essay takes as a given that finance as currently constituted is “core to our economy” and is cautious about the costs and risks of intervention (even though it argues for that course of action).

The case for decisive action is far stronger. The largest financial services firms have perpetrated the biggest transfer of wealth in history via the bailouts. They have gone unpunished for perpetrating the greatest consumer fraud in history, namely, the predatory lending in the subprime phase, the destruction of the integrity of title, and continuing abuses of court procedures.   SOURCE 

I agree with Smith’s analysis here regarding “decisive action” and think time will not allow us to treat this in a slower manner where only a small number of people will be impacted by continued addiction.  The global economy is a hair’s breath away from another serious economic collapse that could be far worse than what we have ever experienced, including that dreadful day back in October 1929.

Does anyone feel differently?

P.S.  Stay linked with the NC blog to read Part IV of Sandquist’s Finance in Denial.

"Can I float you a loan to expand your business Jimmy?"

FURTHER READING:

Morgan Sandquist: Finance in Denial – An Intervention

ECONOMIC HEROIN 

Posted by lbwoodgate in Social Discourse

We live in dangerous times, and not from the usual suspects.  The pervasive fear that has enveloped this country since 9/11 has grown to a point where no one is truly safe from the excesses of the law.  While the Right focuses on “government over reach” aimed at ameliorating the plight of low and middle-income families, some of us are more concerned about how easily it is becoming for all Americans to lose their voice in a democracy

courtesy of truthdig.com

The criticism of law enforcement at the national security level following the terrorists attacks on the Twin Towers and the Pentagon was that the terrorists were hiding in plain sight.  Though some within the FBI were suspicious of several of them, their hands were essentially tied because of legal barriers that had been erected by forces in or supportive of the CIA and the FBI.  This all began to change within months following the attack where communications between these two entities became designed to facilitate the capture of any future terrorists or intercede before their devious acts reached dangerous levels.  But it appears the need to better protect its citizens has developed in part as a means to selectively deprive them of due process.

I lay out here the barest essentials of two articles that address this dilemma and highly recommend the reader to click on the links I have provided to get the full understanding of what they convey and what we seem to be facing as a nation.  Like the terrorists who attacked us on 9/11, the numerous red flags amongst us that warn us of the slow, insidious deprivations of personal freedoms, are hiding in plain sight.

CONTRIVED SECURITY THREATS

In his article entitled, Someone You Love: Coming to a Gulag Near You, Chris Hedges exposes a security world where thousands of locations and hundreds of thousands of people now work for the combined agencies that make up the Homeland Security Department, or are on contract to them and who have been allowed to invade the privacy of each and every citizen without any real need to do so at some times other than a gut feeling from which anyone of them may conjure up.

I understand there are people who feel that these are dangerous times that require extraordinary measures, even to the detriment of some personal liberties.  How well though do most of us understand the extraordinary measures our government has undertaken and how massive and complex it is.  Hedges feels “we have created this monster [that] will be difficult, perhaps impossible, to free ourselves from … .”  What was intended to protect us from the radical extremists of fanatical groups is now capable of controlling and limiting any and all criticism by U.S. citizens that may be viewed as a threat to the real power in this country – the crony capitalism made up of some high-powered, extremely wealthy corporate and Wall Street people and their minions in government.

Hedges warns us of the potential danger to the ordinary citizens from the National Defense Authorization Act (NDAA) that President Obama signed into law on December 31st last year.

This act, … puts into the hands of people with no discernible understanding of legitimate dissent the power to use the military to deny due process to all deemed to be terrorists, or terrorist sympathizers, and hold them indefinitely in military detention. The deliberate obtuseness of the NDAA’s language, which defines “covered persons” as those who “substantially supported” al-Qaida, the Taliban or “associated forces,” makes all Americans, in the eyes of our expanding homeland security apparatus, potential terrorists. It does not differentiate.

The law’s potential abuse became apparent to Hedges and others when some within this huge security infrastructure tried to link Occupy Wall Street (OWS) to “Islamic radicals and websites as well as jihadist ideology.”  Players in this particular scenario included several private entrepreneurs who cater to the security needs of our government.  Based on information leaked Feb. 27 by WikiLeaks, Thomas Kopecky, director of operations at Investigative Research Consultants Inc. and Fortis Protective Services LLC, and Fred Burton, Stratfor’s vice president for counterterrorism and corporate security and a former deputy director of the counterterrorism division of the State Department’s Diplomatic Security Service, appear to have a part in a conspiracy to link the OWS movement with jihad radicals like al-Qaeda and the Taliban.

Next, the managing partners of Provide Security, a private organizations that is cloaked in secrecy, had an article published on Andrew Breitbart’s right-wing blog that made the specious case for such a link based on what they claimed was “information about USDoR (U.S. Day of Rage, to which Occupy Wall Street is connected) [that] had been posted on Shamuk and Al-Jihad, two Al-Qaeda recruitment sites”.  Several months after that story, Hedges notes, “Australian Security Magazine published an article titled ‘Radical Islam: Global influence in domestic affairs’ that directly tied U.S. Day of Rage to radical Islamic groups.”

The seed of a conspiracy was now planted and it only took the expected acquiescence of right-wing blogs and FOX news to spread the unfounded assumptions deep within the country’s social conscience.

The fact that foreign radicals may try to exploit the events of a national, non-radical, peaceful movement for their purposes is understandable if the target is the corporate leviathan that too often runs rough shod over public interests here and abroad.  Disrupting the economy is a well-known tactic that many anti-American and anti-capitalists groups use to achieve their goals.  But what appears to be transpiring here is not to weed out these bad elements but to discredit an entire movement; one that is legitimately attempting to expose the greed within the financial world of Wall Street and bring to bear their sins we have all paid for with our taxes, our jobs and health care, our homes and our futures.

Feeling that profits may suffer, it only seems normal that corporate special interests would take any and all measures they could conceivably utilize to undermine anyone who publicly speaks out about the unethical practices they may have engaged in.  We know the Justice Department has yet to throw any financial CEO in jail for their part in the economic collapse that we currently find ourselves struggling to overcome.

POLICE PROTECTION FOR THE FEW

The other article that alerts us to the excesses of the law was a recent Supreme Court decision reported in the NY Times by Adam Liptak, Supreme Court Ruling Allows Strip Searches for Any Arrest.

The Supreme Court on Monday ruled by a 5-to-4 vote that officials may strip-search people arrested for any offense, however minor, before admitting them to jails even if the officials have no reason to suspect the presence of contraband.

Justice Anthony M. Kennedy, joined by the court’s conservative wing, wrote that courts are in no position to second-guess the judgments of correctional officials who must consider not only the possibility of smuggled weapons and drugs, but also public health and information about gang affiliations    

Again, with an inordinate concern that there are too many bad people out there to be protected under the shields of our constitution, the conservative justices and the alleged moderate Anthony Kennedy, have weakened time-honored law, feeling compelled to trust that human beings who work for our law enforcement agencies would never use unnecessary search and seizure tactics to harass other human beings.  Not that they wouldn’t sustain a verdict that could prove without a reasonable doubt that such abuses occurred.  But then how many such abuses would ever make it to a local court, much more the Supreme Court.

There is a population out there that perhaps many feel warrant these intrusive measures by their mere association and history with the “wrong elements in our society”.  Such is the state of our humanity towards the human contingent that often finds themselves being thrown into the dregs of society because they, for reasons often not of their own doing, have failed to legitimately provide for themselves.

The Supreme Court’s ruling now circumvents the previous necessity for body searches on people who were reasonably suspected to have and likely to possess outlawed contraband.  Anyone, for any reason may now be stripped searched without reasonable cause, based solely on the feelings and attitude of the jailer in charge on any given day.  You may have offended the sensitivities of that jailer in some unintended manner and with this court ruling, that jailer or jailers may teach a lesson to some poor victim by humiliating them with a body search.  What other explanation would a reasonable person consider when a “nun was strip-searched, … after an arrest for trespassing during an antiwar demonstration”?  Would any other “radical” or participant in the OWS movement receive different treatment by those in our criminal justice system who hold a love it, or leave it mentality?

Citing examples from briefs submitted to the Supreme Court, Justice Breyer wrote that people have been subjected to “the humiliation of a visual strip search” after being arrested for driving with a noisy muffler, failing to use a turn signal and riding a bicycle without an audible bell.

Justice Kennedy responded that “people detained for minor offenses can turn out to be the most devious and dangerous criminals.” He noted that Timothy McVeigh, later put to death for his role in the 1995 Oklahoma City bombing, was first arrested for driving without a license plate. “One of the terrorists involved in the Sept. 11 attacks was stopped and ticketed for speeding just two days before hijacking Flight 93,” Justice Kennedy added.

Pointing out that some harmless looking people who were stopped for minor offenses turned out to be “devious and dangerous criminals”  does nothing more than create a certain shock affect while ignoring the fact that the terrorist wasn’t arrested and it doesn’t answer if McVeigh was searched and found to have illegal contraband.  To now put all citizens into a category with people like this also ignores the fact that strip searches initiated without reasonable cause seldom prove beneficial.  In the NY Times story, Liptak reports that Justice Breyer noted “that there was very little empirical support for the idea that strip searches detect contraband that would not have been found had jail officials used less intrusive means, particularly if strip searches were allowed when officials had a reasonable suspicion that they would find something.”

MAKING A DIFFERENCE

I am NOT a conspiracist.  I AM a reluctant activist, and a poor one at that, who sits on the side lines and cheers others on to do the leg work.  I try to make excuses and say at 63 I have not only done my part in more youthful days but now my body restrains me from getting back out in the trenches.  Yet when I see the faces in OWS crowds, anti-war protests and marches on state capitals to oppose further cuts to vital social services, I see many who are my age and older.  I am encouraged by these people and feel in time that I too must get back on the streets and be seen and not just heard.

If you think the premise of this post is shaky and even over blown I suggest you consider what the two host cities for the Republican and Democratic conventions are imposing on anticipated protests from citizens.

Tampa, Fla., which will host the Republicans from Aug. 27 to 30, and Charlotte, N.C., which will host the Democrats from Sept. 3 to 7, are already … devis[ing]  … creative ways of distancing protesters from the politicians, delegates and journalists attending these stage-managed affairs.  Charlotte has adopted an ordinance that expands the power of the local police to detain, search and arrest persons in its downtown core. (The Charlotte ordinance also bans camping on city-owned property, a clear response to the Occupy movement.) Tampa is also considering new municipal laws to limit, and in some instances flatly prohibit, downtown protest activity.    SOURCE

What both of these reports convey is that there are people in positions of authority who make decisions about the rest of us but who clearly don’t seem to identify with the average citizen.  The stereotypes these authorities have of “malefactors” exists because they cannot see themselves being caught up in the irresponsible behavior of a security agent or a zealous cop arresting them without cause, wanting to humiliate them to prevent them from engaging in legitimate actions that question the legitimacy of those who hold great power in this land and around the globe.

As this corporate-friendly mindset assimilates itself deeper and deeper into the legal institutions we’ve established to protect us from fanatics and usurpers of our rights as citizens, we ourselves become subject to the whims of those who use their wealth to leverage their positions; positions that take more and more for themselves while leaving everyone else to fend for themselves.  Is it possible that such greed cannot see the seeds of its own destruction in such action?  History has shown us that often the public is so easily duped to believe that the self-serving interests of a wealthy elite are compatible with their own, only to discover too late that economic equality is never given freely by those who hold all the marbles.

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Posted by lbwoodgate in Social Discourse