Monday, June 27, 2016

Will Brexit spread?


The Full Monty, a film set in Sheffield England is a sad but whimsical account of how six unemployed steelworkers attempt to scare up some money by becoming strippers.  While taking off one's clothes is considerably easier than making steel, organizing an act that will actually pay is difficult enough and at the end of the movie when the steelworker-strippers are lustily cheered by a house full of drunken women, there is a sense of accomplishment that passes for a happy ending.

Of course, this happy ending is all fiction.  The real story of Sheffield is far more miserable.  This city had been the heart and soul of English steelmaking since they started making knives in the 14th century.  In the 1740s, Benjamin Huntsman perfected a superior method for making crucible steel and by the 1850s, Henry Bessemer had moved to town with his vastly improved steel process.  Steel was now a mass-produced product and by 1900, Sheffield's population had grown to 491,000.  In 1973, the UK joined the EU.  In the 1980s, Margaret Thatcher "rationalized" Sheffield out of the steel business in an EU-wide restructuring of the industry.   Sheffield was probably targeted because of its long association with trade unionism. 120,000 people lost their jobs.  Sheffield lost its reason to exist.  And even if six of those ex-workers had managed a one-night payoff for going The Full Monty, that still leaves them suffering through an existential nightmare for over 30 years.


A.R. Heathcotes & Co - Steelworks

So guess what?  The people of Sheffield voted to leave the EU.  The vote was closer than in the surrounding countryside because Sheffield itself has become something of center for immigrant settlement.  But the folks who remembered what happened to their city and lives were still enough to carry the day.

The EU is failing for one simple reason. It is based on a ridiculously stupid idea—neoliberalism.  That idea set has been around since forever and can be directly implicated in such disasters as the Panic of 1873 and the Great Depression.  You can fill libraries with solid evidence why these crackpot ideas don't work.  Well, they do work for a tiny few who can afford to buy the economic conversation.  Explain to me how someone in Sheffield whose life is as disaster can EVER relate to people who spout meaningless neoliberal platitudes that were so carefully drilled into their heads as part of their "elite" educations.

What EU doesn't understand is that most people, if given a chance, would gladly throw their smug butts into a dungeon, but will at least vote to get them out of their lives.  Because while most detest the arrogance of our precious "elites," what really infuriates people is that they are so utterly incompetent at building a Europe that actually works for its citizens.

Some pretty good stuff is being written about Brexit.  The ruling class usually gets its way.  And goodness knows, they have a good chance of getting their way this time.  But for a brief moment, they have caught a glimpse of what a world looks like where they don't pick the outcome even after buying up the economics profession, the newspapers, and damn near all the politicians.  It's getting harder to bullshit people.  This is a story worth writing about.
  • The first article today asks a most obvious question, "why does the so-called left defend the EU?"
  • Alexander Mercouris speculates on the spread of Brexit, The US, the EU and the Spectre of Brexit
  • Finally, Michael Hudson snickers about the vast fortunes lost by folks betting the wrong way on Brexit.

Friday, June 24, 2016

Brexit, oh my

As someone who has long held the EU with suspicion, if not outright contempt, I suppose I should be celebrating that the Brits have voted to leave that poisoned organization.  But mostly, I feel fear and resignation because these votes rarely change anything.  The EU has a long history of forcing countries to keep voting until they get it "right."  Worse, the EU's fatal flaw is that it is essentially a neoliberal project and merely getting rid of it won't change much because the UK is awash in committed, home-grown neoliberals—including many in the leadership of the Brexit campaign.  In fact, outside of the campus of the University of Chicago, it would be hard to imagine anyplace where neoliberalism is more widespread and more pure than the Sceptered Isle.  In any case, the mechanics of actually leaving the EU are so convoluted that it will require an absolute minimum of two years to accomplish the task.

If the EU was in fact NOT a neoliberal project, it would probably be the glowing achievement envisioned by it founders.  But it isn't.  So the great task in front of those who are horrified by what the EU has become is to come up with a replacement for neoliberalism, not trash the organizational structure of the offices in Brussels.  Keynes explained the problem best.
“Practical men who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back”

Wednesday, June 22, 2016

Operation Barbarossa—75 years on

On Jun 22 1941, the Germans unleashed their by-now well practiced Blitzkrieg on the Soviet Union.  The result would leave nearly 27 million dead from USSR alone.  The destruction was mind-boggling.  If USA had suffered such an invasion, everything from the Atlantic to the Mississippi would have been destroyed.  And yet, because the Soviet Union is so large, they were able to fall back and mount a spectacular defense / counterattack that destroyed the greatest German Armies and eventually drove them back to Berlin.

Yes, we who were born after 1945 in USA have never been told this story.  This is a damn shame because without understanding Barbarossa, not much that happened in the next 50 years made much sense.

Interestingly battle for Russia was reported magnificently in a documentary by one of USA's best film-makers—Frank Capra.  The footage he uses was often shot under dangerous and dificult conditions.  It has been lovingly restored by the US National Archives and is on YouTube.  Or right here.  Watch this and see if it doesn't add a great deal to your worldview.

Monday, June 20, 2016

ExxonMobil CEO: ending oil production is 'not acceptable for humanity'


We want the oil companies to be more enlightened than they are.  Unfortunately, MOST of the criticism of Big Oil is mistaken to the point of goofiness.  Whenever I hear someone go off on oil companies, I want to shout, "If you think these folks are so evil, stop doing business with them."  Of course, that will never happen because people need energy to survive.  Most folks would be in terrible trouble if their energy supplies were cut off for 72 hours.  Fuels are used to grow their food and get it to their kitchens, keep them warm, heat their water, cook their food, etc!  And if their energy supplies were cut off at the wrong time, such as when they were in the middle of heart surgery, they would die in minutes.  Besides, a large number of people would lose their pensions if the oil industry were closed down.

Then there is the reality of the oil business itself.  It takes around 20,000,000 barrels per day to keep the USA running.  That folks, is a LOT of oil.  The people I know in oil are absolutely in awe of that number and spend most of their working lives scrambling to supply that vast ocean of fuels.  The oil companies almost never advertise because people come in to buy whenever that pointer goes to E.  And to get that oil, the oil giants travel to some of the most inhospitable places on earth and deal with some of the most violent and well-armed governments.  They know what they do is important and that it requires the dedication of hard-working, intelligent, and often extremely brave people.  And they don't suffer fools gladly.

The ONLY solution for burning fossil fuels is to come up with another way to power the society without them.  Now it would be nice if the oil companies were working on that problem, but considering the size of the problems they must solve on a daily basis, it is probably a bit much to expect them to take on another insanely difficult challenge.  And so we discover that the folks who figured out how to make affordable solar panels came from the computer industry—specifically the people who figured out how to coat glass with semiconductors.  I found out not long ago that the key actor was Applied Materials—the people who made the tools necessary to fabricate integrated circuits.  There is also an excellent Youtube on how all this was accomplished (about 30 minutes).

Monday, June 13, 2016

New journalism—what happens when mainstream media becomes hated by all?


The commercial "mainstream" media has been in trouble for quite awhile now.  I pretty much gave up on it in 1982.  After four years of microscopically examining the flaws of the Carter administration, I realized that the same "journalists" were going to give Reagan a free pass for policy and administrative decisions that were far worse than anything Carter had done.  I decided that watching such outright lying and abject stupidity was probably bad for my health and one day, I just stopped watching the newscasts and reading the daily papers.  As a news junkie since junior high, this was harder than I thought it would be.  Finding alternative news sources turned out to be difficult and expensive and the closest newsstand that sold what I was looking for was a 14-mile round trip.  So yes, I cheated.  I'd flip on CBS or PBS on occasion to see if I was missing something interesting or important.  Mostly I confirmed that infotainment was just as big a time-waster as I remembered.

There was also a fascinating outlet for my political and social curiosity.  About the same time, I stumbled across my maternal grandfather's reading list from the 1920s.  He was a regular customer of the output of a Girard Kansas progressive publishing house run by a relocated Philadelphia lawyer named Emanuel Haldeman-Julius.  His main product were these nickel and dime books for the working man called The Little Blue Books.  Soon, I met a guy who had boxes of these things and would eventually read over 400 of them.  It was the most incredible intellectual experience of my life.
The novelist Louis L’Amour (1908-1988) described the Haldeman-Julius publications in his autobiography and their potential influence:

Riding a freight train out of El Paso, I had my first contact with the Little Blue Books. Another hobo was reading one, and when he finished he gave it to me. The Little Blue Books were a godsend to wandering men and no doubt to many others. Published in Girard, Kansas, by Haldeman-Julius, they were slightly larger than a playing card and had sky-blue paper covers with heavy black print titles. I believed there were something more than three thousand titles in all and they were sold on newsstands for 5 or 10 cents each. Often in the years following, I carried ten or fifteen of them in my pockets, reading when I could. Among the books available were the plays of Shakespeare, collections of short stories by De Maupassant, Poe, Jack LondonGogol, Gorky, Kipling, Gautier, Henry James, and Balzac. There were collections of essays by Voltaire, Emerson, and Charles Lamb, among others. There were books on the history of music and architecture, painting, the principles of electricity; and, generally speaking, the books offered a wide range of literature and ideas. […] In subsequent years I read several hundred of the Little Blue Books, including books by Tom Paine, Charles Darwin, and Thomas Huxley.
So no, I did not miss being lied to by folks who were turning CBS News into light fiction.  And when I got connected to the internet, any reason to look at commercial news utterly vanished.  As I say these days, "Ignorance is a choice!"  But the internet is not an unvarnished blessing.  In fact, most of what's there is crazy and ignorant.  But here's the deal—even if the internet is 98% rubbish, the remaining 2% is worth knowing.  And 2% of all of human knowledge is more that the brightest among us can hope to absorb in a lifetime.  So the bigger question is, "How do you find the worthy 2%?"

Actually, I have a BS filter that works so well, I barely think about it any more.  But recently, I had a young man ask me how I felt so sure-footed in separating the wheat from the chaff.  My answer had two parts.
  • Even with the internet, it still helps to read the books written by those who were there when the great human ideals were invented.  
  • Never scorn as unimportant the little factoids that describe how the world works.  It may not seem a big deal to know that water runs downhill or that the suns rises and sets in a different place each day with a certainty that can be predicted for centuries in advance. But you would be astonished at how many arguments fail to meet such simple intellectual standards.  Even better, large complex arguments can be constructed from a multitude of smaller facts that are beyond rational debate.
Predictions of the death of mainstream journalism have been around for a couple of decades now.  I figured the time for these dinosaurs was past when I saw of survey conducted by the Washington Post where over 30% did not want delivery of the Post—even if it was free.  Of course, Washington is a town where people still use fax machines and the nation's nuclear arsenal is controlled by an ancient computer system that uses 8" floppies.  So I would imagine that the pundits who share the inside-the-beltway thinking will be the very last to know that the Post is not a useful and reliable news source.

Saturday, June 11, 2016

Political update—is this the best we can do?


Politics is beyond depressing these days.  Yes I know, I am the one who argues that the big problems can only be solved by putting the Producer Classes back to work.  The best that politics can accomplish is to make it possible for the Producers to organize into a major problem-solving mode.  The worst they can do is divert all the community's spare change into their own bank accounts—they certainly can get in the way.

The idea that we can afford to waste another four years diddling while the earth burns is beyond obscene.  We just wasted the last eight years getting almost nothing done and since Hillary promises to be four more years of Obama, there is little hope for improvement.  And Trump is a climate change denier.  The guy owns some expensive Florida beach-front property so the evidence that the climate is changing is set to wash up on his lawn.  And since he does have a few Producer tendencies, he might be open to some enlightenment if he could be convinced that doing something was up his alley, but that is expecting a big conversion.

The good news is that Bernie Sanders has demonstrated just how large an audience there is for a Progressive / Populist message and how possible it is to access them with a combination of the internet and live appearances.  That he got so many votes is miraculous.  Here in Minnesota he won 60-40.  And I am pretty sure that not one person made a pro-Bernie voting decision reading the Minneapolis Tribune or watching WCCO.  Sanders did run some professionally-produced ads on local TV but I am not sure those moved votes either.  Changes in communication technology tend to lead to major social change like the printing press in Germany leading to the Protestant Reformation.  I keep waiting for digital communication to lead to significant social shifts.  The Sanders campaign may be what I have been looking for.

Even so, I look at the disaster that is the neocon / neoliberal loonie Hillary Clinton and feel genuine despair.  How could it come to this?  It wouldn't be so bad if there were plenty of time to solve the big problems rolling towards us with the certainty of gravity and arithmetic.  But there isn't.



Monday, June 6, 2016

Upgrading lighting


There is no easier or better way to upgrade one's energy efficiency than by swapping out light bulbs.  That doesn't mean it's easy because the whole lighting market has been a moving target for several years.  It has been confusing enough so that there has been political blowback against energy-efficient bulbs.  I know someone who bought a whole big box of tungsten incandescent bulbs because he thought the energy efficiency standards were going to fail.  Our resident political nutcase, Michele Bachmann, even made her war on energy-efficient lighting part of her run for the presidency.

And hard as it is for me to admit it, Bachmann had a point.  The interim "solution" was the compact fluorescent bulbs (the curly-tails).  They were generally affordable but had significant problems shared with the rest of fluorescent bulbs—mostly they contained mercury.  But the other big problem was that they had an unpleasant color—fluorescent bulbs start out green.  In order to make them look like incandescent lights (which everyone loves because they resemble fire light) an orange-yellow coloring had to be added.  Since the original green was never fully covered, the resulting light could make skin look jaundiced and most folks object to looking like they may be suffering from liver disease.

The real solution was the Light Emitting Diode (LED).  These utterly clever devices were astonishingly energy efficient.  But in the early versions, they didn't put out a lot of light and were EX-PEN-SIVE.  The first bulb to replace a 40 watt incandescent I saw at Home Depot about eight years ago cost $40.  Now there were calculations that in 10 years or so, you could pay for one of these with electrical savings but $40 was still too much sticker shock for me.  And seriously, this so-called 40 watt replacement only put out about 80% the light of a $1 tungsten bulb.

Two years ago, I went shopping for replacements for the 50 watt GU-10 halogen bulbs in some track lighting.  There were  LED replacements at the local big-box building supply but they still wanted $25.  I was able to find some on Amazon for less than $7 so that's what I bought.  The LED replacement uses 6 watts.

A month ago, we decided to finally strip some truly ugly wallpaper off the dining room wall and paint.  My SO had purchased a lovely George Nelson bubble lamp about three years ago to replace an ugly brass chandelier, but she has been sick and so this project sank to the very bottom of our to-do list.  But one morning I heard her cursing at the wall paper steamer so I knew the project was back on.  And I was going to have to make some decisions about installing this wonderful light fixture.

The instructions said the fixture could accommodate up to a 150 watt incandescent.  While LEDs have come down considerably in price, there was still really nothing that big and even two 75 watt lamps would cost about $80.  However, the 60 watt replacements are now running in the $3-5 range—the more expensive ones are dim-able.   So I chose to put two 60s (9.5 watts) in the bubble knowing that this was already a lot of light.  The other choice was color.  The replacement for incandescent bulbs are usually listed at 2700°.  And unlike the curly tails, they really are 2700°.  But there are also many LEDs at 3000° and it is a color I really like.  It is close enough to the old tungsten color but it is just enough more "white-bright" to make reading easier and food look better.

About those dimmers.  In the old incandescent days, a dimmer merely changed the amount of electricity flowing to the bulb.  With LEDs, the dimmer must control a diode.  The bad news is if you want to control your light levels, you must replace that too ($25).  The good news, in my humble opinion, is that with an LED, the light output changes but the color does not.  I find this cool beyond words.  But apparently, not everyone agrees because there are now LEDs that DO change color as they are dimmed.  In fact, I saw one LED that allowed you to dial up the color from candlelight (2100°) to high noon sunlight (6200°) with an app on your smartphone.

So the lessons I learned about the brave new world of LEDs include:

1) The most common bulbs are dirt cheap already.  These include 40 and 60 watt replacements and the recessed can lighting bulbs.

2) The great prices can be had at Costco, IKEA, and Amazon (and probably others.)  My local big box store has a brand new LED section with prices as low as IKEA.  Price is no longer an excuse to not buy these truly amazing bulbs.

3) There are reasons for installing LEDs beyond costs.  Best example might be replacing tube fluorescents.  The replacement for a 40 watt tube currently costs around $12.  The difference in efficiency is small compared to swapping out an incandescent—the LED requires 21 watts so the energy saving is less than 1/2.  But I know someone who works under those tubes and recently they were replaced by LEDs.  Instant on.  No flickering (no headaches).  No hum.  No mercury.  Great color.  Changing the light source has changed his work environment.

So here it is—our new dining room fixture.  Designed in 1952—it became an icon of Modernism.  It has been described as a paper lantern crossed with a flying saucer.  The amazing exterior is a plastic once used to mothball Liberty ships.  And I am willing to bet that this classic has never looked better than with LEDs providing the light.  We are extremely pleased with the outcome.  I had a blast learning the possibilities of this new world of lighting.  And when I get done converting the house to LEDs, we will use less than 20% of the electricity of the old lights.

Monday, May 30, 2016

The war on the producer classes

My personal discovery that "liberals' were grossly intolerant of working people came as quite a shock.  One of the characteristics of a rural Corn Belt upbringing was knowing men who took great pride in being good with tools.  Even people who could afford to hire out such work (construction, machinery repair, etc.) usually had gone through a period when they had actually worked with their own hands.  My grandfather could fix almost anything and firmly believed that there was only one truly virtuous occupation—farming.  He made allowances for clergy so as to to include my father but I am pretty certain that exception was only made because my father had grown up on a working farm.  I can honestly say that I never heard anyone disparage productive work until I went off to the University where I discovered there were plenty of people who treated working people with utter contempt.

My favorite story came one bitterly cold winter night when I took a shortcut across a parking lot where I discovered two guys trying to jump-start a car.  They were doing it all wrong to the point where they were about to blow up a lead-acid battery.  I straightened out their jump and a few minutes later, the dead car had returned to life.  They seemed quite appreciative until one recognized me as one his students.  How could I possibly be a serious student if I was so damn working-class?  He literally stared at me.  I should have let those two wreck their cars and blow sulfuric acid all over their contemptuous mugs.

No long after, I discovered a neighbor in the dorm who was extolling the virtue of the SDS.  These geniuses taught the working people were no longer the vanguard of the revolution but that "youth" was now a class.  I thought he was crazy / joking but nooooo, I would so discover that the Democratic Party was about to abandon its labor roots.  45 years later, and my party still hasn't enacted a decent health-care system but we have beaten every social issue into advanced boredom.

But listening to the Yuppie Scum "liberals" who are trying to sell us a women with severe right-wing tendencies as a "progressive" has brought out that old anti-worker animus.  Kilpatrick does a good job below of describing the class warfare that has raged within the Democratic Party for over a generation.

Friday, May 27, 2016

More on diesel emissions cheating


When Volkswagen got caught using cheating software for their TDI line of diesels, I suspected that they were a LONG way from being alone.  Part of the reason stems from a lecture I got in 1973 from a transportation-technology instructor I had as part of my city planning sequence.  The professor was from the mechanical engineering department over at the Institute of Technology.  Keep in mind this was the University of Minnesota and not some car-state school like U Michigan or Perdue.  Even so, I am pretty sure he had his facts straight.  And the point he was making that day was it was going to be impossible to make diesel engines both clean and super energy-efficient.  He wrote "Nitrous Oxide" in big letters across the top of the chalk board to ensure we understood the important problem area.  He argued that regulators—especially at the California Air Resources Board—were about to enact regulations that were physically impossible to meet.

I did not want to believe him.  I wanted to believe that predicting something was impossible was not an especially valid tactic in any area dominated by professional inventors.  Proving skeptics wrong was pretty much the major thrust of the 20th century.  But now that I have passed my 66th birthday, I have discovered that there are indeed many things that ARE physically impossible, and that there are valid ways of knowing what they are.  And no, George Jetson's flying car that folded up into a briefcase light enough to be carried by an obvious wimp was never going to be built no matter how much development money was thrown at the project.

So I have come to agree with my old prof.  It looks like there really was no way to make a decent diesel engine that met those flight-of-fancy regulations that left him sputtering.  Below, we have a list of the strategies employed by various automakers in the pursuit of something that really WAS physically impossible.

Thursday, May 26, 2016

TTIP necessary to protect megabanks from prosecution

Oh, those lovely trade agreements.  Those of us who are veterans of the 1992-93 fight against NAFTA find it hard to believe that someone has designed a trade deal even more odious.  Someone has been working overtime because the TTIP makes NAFTA look like an act of charity.

The problem with these trade deals is that they operate from the assumption that anything that might possibly impede unfettered trade is by definition, evil.  And so social necessities like environmental laws, consumer protection, fair labor standards, etc. are all targeted as impediments to trade.  Worse, these local laws and regulations can be sued out existence if it can be proven that they materially harm the interests of those who would pollute, run sweatshops, and otherwise accelerate the race to the bottom.

It requires a lot of coordinated political action to get most such laws and regulations in place.  Watching them be eliminated naturally upsets those whose efforts these trade deals negate.  Not surprisingly, these trade deals face enormous political opposition.  That's not a problem for those who would profit from them.  For them, democracy is merely a messy detail.  The only hope is that the opposition to the mega-Predators who want these new NAFTA-on-steroids deals is substantially larger and vastly more organized than in 1993.  It also helps to have the NAFTA disaster to point to.

Monday, May 23, 2016

The environmental costs of militarism


The last time I made the mistake of attending a conference / seminar on the subject of climate change, we were treated to a keynote address by a long-time and very successful local weatherman / entrepreneur who after a couple of decades of climate change denial, had embarked on a new career explaining why he finally had become convinced that the science predicting a climate catastrophe was correct.  The guy's commercial success over the years was hardly an accident—he is witty and charming.  So charming, in fact, it was easy to overlook the fact that he has also been associated with some of the more crackpot versions of Christianity, is a lifetime Republican who still looks at the Reagan presidency as one of the high-water marks of USA history, and carries himself with the kind of swagger associated with those who have made a large pile of money in life.  But these attributes were essential to his new persona.  He was saying, "Look at me!  Even someone who had the prime characteristics of a climate change denier has now seen the light.  So believe the light!"

Tales of such a major conversion are central to the teachings of Christianity.  In fact, the majority of the New Testament revolves around the story of how Saul, who once actively participated in the persecution and murder of early Christians had seen the light and become Paul, the missionary who spread the new faith throughout the Roman Empire, had written the most popular lessons of the new doctrine, and in the end, had become a martyr of the cause.  Our newly enlightened weatherman was even named Paul in case any of us were to miss the lesson for the day.

As someone who was exposed to regular readings from the letters of Saint Paul throughout childhood, I understood and could appreciate what our keynote speaker was up to.  Even so, I started to wince when he began to quote Reagan or assured us that there was nothing about the practices of "free enterprise" that would lead to climate change denial.  But then he began to discuss how the US Navy, whose most important installations are at sea level and hence especially vulnerable to changes in those sea levels, were among those who took the science of climate change most seriously of all.  At one point he said, "When it comes to climate change, the Navy really gets it."  Because I know the enormous contributions made by the USA military to the carbon loading of the atmosphere, I almost threw up in my mouth.  No Paul, the Navy does NOT "get it."

Because he is a public figure, our weatherman Paul is now targeted by the climate change denying trolls.  This persecution probably assures him that he also "gets it."  Well, Paul, you don't get it but thanks for trying.

Saturday, May 21, 2016

Michael Lewis: The Book That Will Save Banking From Itself

During my visit with Jon last month, we both agreed that Michael Lewis is one of the best USA writers living. A partial list of some of Lewis's books:

Liar's Poker: Rising Through the Wreckage of Wall Street (1989)
Moneyball: The Art of Winning an Unfair Game (2003)
The Blind Side: Evolution of a Game (2006)
The Big Short: Inside the Doomsday Machine (2010)

The Big Short was the basis of the movie Jon reviewed here a couple months ago; I reviewed the book back in June 2011.

Since the article below was written by Lewis, I overcame some grave misgivings, and decided to post it here. It is a rather detailed review of a recent book by the former governor of the Bank of England (2003-2013) Mervyn King. The book is entitled The End of Alchemy: Money, Banking, and the Future of the Global Economy, and it presents King's argument that nothing has fundamentally altered the financial system's stupidity, greed, and appetite for high-payoff risks, followed by King's detailed proposal for what governments and financial regulators should do before the next crisis inevitably hits. Normally, I do not believe that highly technocratic financial discussions conduce to furthering an enlightened public discourse. Frankly, such discussions are usually a steaming pile of bovine manure. But now that it appears our sole choice for USA President is Trumpillary, it seems very likely that the best we can hope for in terms of forcing the banksters to behave civilly is exactly the sort of proposal King is putting forward.

I also am usually reluctant to hold anything British in a favorable light. But, some of the most startlingly truthful pronouncements by financial officials during and after the Crash of 2007-2009 were from King, and from Adair Turner, who became chairman of the UK Financial Services Authority in September, 2008, five days after Lehman Brothers collapsed.

In my opinion, King's proposal to have central banks determine beforehand how much capital they would lend against big banks' riskier assets in a crisis is fundamentally flawed on three counts. First - which Lewis discusses briefly - is that the big banks have achieved "regulatory capture." It is very likely that in a severe enough crisis, what a central bank had previously said would be the upper limit it would lend to a troubled bank in a crisis, will simply be ignored. Or, some other part of government will be prevailed upon to give the bankers the money they say they need to prevent the collapse of Western civilization.

Second, King's proposal accepts as valid the current business model of Wall Street and the City of London. He is not proposing to outright prohibit the riskiest behavior of the big banks. Rather, he explicitly argues that with the role of a central bank in a crisis firmly fixed beforehand, "the market" can be relied on to do the right thing, and leaving free the "incentives to innovate." This is, therefore, no repudiation of the reigning neo-liberal economic paradigm of the past half century.

Third is an extension of the second: I do not believe that we can build a sustainable economic future for humankind if we continue to treat present financial elites as legitimate. The past half century of financial legerdemain and shenanigans have, in a financial echo of Grehsam's Law, turned most of the financial system into a vast criminal enterprise. I agree with Ian Welsh, who a few days ago wrote Seven Rules for Running a Real Left-Wing Government:
The banking sector creates money. Money determines what people can and cannot do. This is the control mechanism for the economy in any state which runs on markets. You must control it. If you control it, you can use it to strangle your domestic enemies. If you do not, your enemies will use it to strangle you.
Welsh goes on to provide a stark example of how Obama, had he been a real leftist, could have used the crimes of the banksters to seize their money under RICO. 

Far better to simply tax all financial market transactions. You don't even have to ban the most odious transactions outright. A simple tax of less than one full percent would be enough to render much of the speculative trading in financial markets unprofitable.

Monday, May 16, 2016

Ellen Brown on Trump's monetary musings

It is really hard to know what part of Donald Trump's message he means or even understands.  I was a designated driver the night Obama won the election of 2008 and watched as deliriously happy and very drunken supporters celebrate what they thought was a new day.  He had talked for months about hope and by god, they were projecting all their hopes on him.  I am pretty sure that Trump's supporters are making the same mistake.  After all, he promises to bring about a brighter day but has already selected a Goldman Sachs man as an economic advisor.

That said, his latest dustup with the lords of high finance over monetary theory has been very interesting.  Not surprisingly, they are aghast at his willingness to point out that the ghouls of austerity do NOT have a monopoly on good economic ideas.  In fact, they have been a global disaster and Trump has much enjoyed talking about this.  So along comes our hero Ellen Brown to inform us how Trump's monetary ideas have much in common with folks like Lincoln and Franklin—two guys who actually appear on the currency itself.  Whether Trump actually understands this little piece of history is an open question.  And to be perfectly honest, it doesn't matter a whole lot that he understands who may have had similar thoughts about money in the past because once someone understands that money is merely a convenience, the idea that money is scarce becomes ridiculous.  And such a thought does not go away no matter who is shouting that the idea is crazy.

It is ideas like these that make the Republican establishment panic at the thought that Trump is their presumptive nominee.  We can be pretty sure they are not worried that he is a walking insult to political correctness—in fact, they probably approve of that.  But if Trump is willing to expose the big lies that banksters use to enrich themselves at the expense of the rest of us, then he MUST be stopped.  We will see.  After all, real estate dvelopers are essentially the only people who understand that their interests and the interests of the banksters do not align and have the expertise and clout to do something about it.  So even though Trump seems to have a short attention span, this might not be an idea that goes away so easily.

Sunday, May 15, 2016

CO2 passes 400 ppm

Not surprisingly, the global CO2 atmospheric concentration continues to rise.  It's getting into scary territory.  400 ppm hasn't been observed for a very long time.  What will happen next is still an open question but none of the guesses are encouraging.

Monday, May 9, 2016

They do not give a shit

On April 8, 2016, I composed a post about the possible final demise of the British Steel industry inspired by a suggestion from reader Mike.  In the ensuing comments, Mike made a further suggestion that is part of today's post.  There are many reasons why this article is so pointedly accurate—not least of which is the tale of how neoliberal thinking makes it virtually impossible for a country like UK to properly value its last remaining steel mill.

Foremost, the title says it all—"they do not give shit."  The "they" are the Leisure Class moneychangers who hold steelmaking in utter disregard.  It is something the "proles" do and no matter how technologically advanced the process may be, it is something as worthy of disposal as a used Tampax.  They do not care because in order to care, they would have to understand what they are throwing away.  And in order to understand, they would have to do the hard work of actually studying the struggles necessary to turn steel from this extremely rare material that was usually fashioned into swords into a mass-produced commodity that could criss-cross a continent with railroad tracks and create the frames for skyscrapers.

When I attempt to explain the physical origins of climate change, I am often met with a similar form of intellectual laziness.  Most people have zero interest in understanding, for example, the role fossil fuels play in feeding a hungry planet.  And even if they do listen to the figures for the fuels consumed, their usual response is to suggest that folks just stop doing things that way.  The idea that they should even be bothered with the tale of how all the decisions to embed fossil fuels in the food system came to be made, is utterly abhorrent.  So naturally, they gravitate towards simplistic solutions like carbon taxes—make fuel more expensive and folks will just figure out a way to get along with less fuel.  Don't bother us with the details—just do it.  So nothing gets done about climate change because those who rule our lives do NOT give a shit about how the community's necessary work is organized.

We will start making progress on the problems of climate change when our Leisure Class overlords start to actually give a shit about important matters—and not before.

Wednesday, May 4, 2016

American producer class hero Peter Cooper

I have just spent an entire (and entirely delightful) week visiting Jon at his home. I wanted to learn how to create and post a video to Youtube, and Jon gracefully obliged me by sharing as much as he could of what he has learned in the past two decades of shooting and editing video. I once had a college professor who told me he spends one hour preparing for each minute he actually lectures.

Making video is much more time intensive. In three solid days of collaboration, Jon and I produced and posted a four minute video on American producer class hero Peter Cooper, builder of the first American steam locomotive, inventor of Jell-O, and founder of Cooper Union. There are plenty of other producer class heroes we could have chosen, but what sets Cooper apart is that he had also elaborated a full, producer class version of American School economics, and, as a result, was nominated by the new Greenback Party as its candidate for US President in 1876. Creating a video on Cooper therefore allowed us to present the policies of the Greenbackers--and there is precious little accurate information on the Greenback Party available, either in print, or on the internet. If there was anything we could change in the video, it would be the last sentence, which would become: "And, all these Greenbacker policies formed the basis for progressive economic policies over the next century, including seeding the ideas for Franklin Roosevelt and the New Deal."

The full transcript is below the video. You will note there are a few, small cuts we made from the full transcript in order to meet our target of four minutes.

We were delighted to find a YouTube video of Eastman Kodak's film of the Baltimore and Ohio Railroad's 1927  "Fair of the Iron Horse... History of Transportation." This film includes footage of actual operation of nineteenth-century locomotives, including a complete reproduction of Cooper's 1830 locomotive Tom Thumb. We included only the few seconds showing the Tom Thumb; if you want to watch the entire 1927 file, here is the link

We were also delighted to find and use in the video scans of the actual Civil War greenbacks, the fiat paper money issued by the U.S. Treasury.




Transcript

Monday, May 2, 2016

Carl Icahn says start spending

Predator Class / greenmailer extraordinaire Carl Icahn seems to think the country / world needs a huge dose of fiscal stimulus.  Well, he's right.  And there is no shortage of jobs needing doing.

So does anyone think this will happen—even if a really rich guy thinks it's a really good idea?

In the Age of Austerity?  Are you kidding.

Tuesday, April 26, 2016

George Monbiot on neoliberalism


Sometimes, I throw around the term neoliberalism as if everyone knows what it means.  Part of this is due to an allergy I have towards folks who like to reduce their debates to definitions.  I was on the debate team in high school and whenever the debate degenerated into some meaningless hairsplitting over definitions, I just wanted to quit.  I always thought that debate was a process that was supposed to yield better answers and definition debates never did that.  Worse, hairsplitting is something Protestant clergy pride themselves on and as a preacher's kid, I pretty much had my fill of this sort of posturing by 12.

The fundamental problems of debates over definitions are several:
1) because we can never really know exactly what is going on in someone's head, we don't even know if they are expressing their position accurately;
2) even the most devout hairsplitters have to acknowledge that there is probably widespread agreement on the basics so there is already enough agreement on terms to continue debating more essential issues; and
3) debates over definitions is a loser tactic—its what you do when you know your position is weak—a tactic designed to deliberately waste time.
Having said this, I do appreciate when someone with the writing chops of George Monbiot decides to define and explain some of the more serious problems associated with the practices of neoliberalism.  And the following effort is especially clear.  I approve of folks who include outcomes in a discussion of theory.  I have discovered in life that this is a highly useful practice.  Turns out it matters almost not at all what people claim to believe as religious or similar practice because at the end of the day, the only important issue is, "Are they good neighbors?"  This makes it easy because neoliberals are nightmare neighbors.

Monday, April 25, 2016

Iceland proposes to take back the power to create money


Michael Lewis likes to recount the story about how the charlatans, who were turning Iceland's very conservative banks into the go-go ponzi schemes that wildly exceeded needs of that island's tiny economy, would flatter the natives by reassuring them that they had a very special talent for such enterprises because they knew how to "manage risk."

Well, actually this story was partly true.  Iceland's largest industry, by far, is fishing the cold and dangerous waters of the North Atlantic.  Anyone who can do that knows that on a regular basis, they have to manage situations that would turn most of us white with fear.  Compared to riding out North Atlantic storms, the "risks" of money management are utterly trivial.  So when those crooked banks went belly-up, the natives pretty much decided that the banksters actually didn't know much at all about risk and treated them as the liars and failures they were.  Iceland sent a surprising number of them to jail.  In fact, Iceland may have jailed more crooked bankers for their schemes in the early 21st century than all the rest of the world combined.

So now that those risk-managing fisherfolk have discovered what a bunch of lightweights bankers really are, they have decided to take control of their money supply.  As the essay below indicates, taking on the international banking establishment at that level can be very hazardous to one's health.  But I seriously doubt the Icelanders will be intimidated—they have been laughing at real risks their whole life.  In USA, the only state that ever managed to set up a publicly controlled state bank is North Dakota.  Not surprisingly, North Dakota, like Iceland, has a serious percentage of Viking inhabitants.  And like for the Icelanders, surviving North Dakota winters is sometimes just as frightening as a North Atlantic storm.

Wednesday, April 20, 2016

Panama and money laundering


The recent revelations about the use of Panama as a tax haven have largely slipped under the radar.  I think I could put people to sleep at great distances by merely bringing up the topic.  But these revelations are very important because they expose a world where banking and organized crime meet to party.  Someone needs to explain why this is important and how it works.  So here is Michael Hudson on a 17 minute video.  I have also posted the transcript below.

Hudson bemoans the incredible entrenched power represented by these financial institutions and how difficult they will be to dislodge.  And there is nothing to make one believe he isn't absolutely correct.  Unfortunately, the powers they have are for looting and pillaging and we are in dire need of the power to build and remake.  So instead of trying to dislodge these casinos, perhaps is is simply more prudent to create alternative institutions.

Monday, April 18, 2016

Big Oil's coverup


According to the latest document dump, the oil industry had an excellent understanding of climate change and their role in the process as early as the 1940s.  Considering that most of us who believe we are ultra-informed didn't really understand the issues until James Hansen's remarkable testimony before the Senate in 1988, this news is stunning.  In fact, many didn't grasp the importance of climate change before Al Gore's movie An Inconvenient Truth in 2006.

Those who instinctively believe the oil industry is irredeemably evil are having a field day with this new information.  Many are comparing this proof of a coverup to the long process of denial by the tobacco industry.  Of course, that is a mighty stretch.  Anyone who stops using tobacco immediately starts to save money and get healthier.  Stopping the use of petroleum products is not nearly so easy or beneficial.  In fact, cutting out fossil fuel usage without a serious program of social and industrial redesign would lead to mass starvation and other forms of social collapse.

Yes, it is fun to point fingers at the people who supply us with the fuels we need to survive.  We can wonder why they didn't warn us when we had more time to figure out a meaningful solution to the climate change dilemmas.  But the answer to that question has an obvious answer—the oil companies didn't have a meaningful answer either.  And before we tout the power and resources of the carbon extraction industries, we should remember that it is now 28 years since Hansen (should have) awakened the people of goodwill to the problems of climate change and almost nothing has been done.  In fact, except for the efforts at solarizing the economy we like to highlight on this blog, 28 years of wheel-spinning has only seen the climate become much more dangerous.

The video at the end of this post is mind-boggling.  The sight of the oil industry citing Arrhenius' 1903 studies of the link between carbon consumption and climate change is breathtaking.  Must watch!