Saturday, October 27, 2012

Tony's Political Economy Round-up, October 27, 2012

In Neoliberalism Kills, Part One, letsgetitdone (Joe Firestone, who is Managing Director and CEO of the Knowledge Management Consortium International (KMCI), crunches the numbers to compare the Affordable Care Act (ACA or Obamacare), with Romney's plan, the Conyers-Kucinich Medicare for All bill (HR 676), and true universal coverage, to see how many lives of poor Americans our elites are willing to throw away.
The ACA saves hundreds of thousands of lives compared with the benchmark and Romney scenarios; but it still projects an additional 286,000 fatalities through 2022 under the ACA scenario, and a total of 427,000 fatalities from 2010 through 2022. This compares to nearly 800,000 under the Romney scenario and just over 700,000 for the no change benchmark. Certainly, the ACA is much better than the Benchmark or Romney alternatives, but it’s hard to avoid noting that the most striking comparison is between any of these three alternatives, and the Medicare for All alternative. Had that alternative been legislated in 2009 and implemented by January of 2010, we’d be looking at virtually no fatalities due to lack of insurance rather than 400,000 or 700,000, or 800,000.
Then he asks the important question: What Was the Justification for Accepting the Cost of Those Lives? 

Just Point # 2 of Five Ways Deregulation is Ripping America Apart is enough to get you mad:
The richest 10 Americans increased their wealth by over $50 billion in one year. That's enough, according to 2008 estimates by the Food and Agriculture Organization and the UN's World Food Program, to feed the 870 million people in the world who are lacking sufficient food. 
"Antiscience Beliefs Jeopardize U.S. Democracy"  is in the latest issue of Scientific American.
By falsely equating knowledge with opinion, postmodernists and antiscience conservatives alike collapse our thinking back to a pre-Enlightenment era, leaving no common basis for public policy. Public discourse is reduced to endless warring opinions, none seen as more valid than another. Policy is determined by the loudest voices, reducing us to a world in which might makes right—the classic definition of authoritarianism.
From the American Bankers Association: Walmart & Amex trash Dodd-Frank:
Walmart will be collecting deposits through direct deposit accounts. It receives fees as a consequence of its lending activities through its credit cards. Plus, it hedges its business operations in the financial markets. 
I can find virtually no information about any of these activities in the company's annual report and 10K. However, companies engaged in collecting deposits and lending money are by definition banks. Banks are not allowed to be involved both in banking and commercial activities. It appears that Walmart is involved in both.
Ask A Banker: Derivatives, Gambling And Getting Around Regulation:
There is great joy to be obtained from understanding a vast and semi-logical body of rules, and then understanding a different vast and semi-logical body of rules, and then figuring out the differences between them that you can exploit, and then building a product to exploit those differences, and then giving it a catchy name. Throw in a dash of math, a heap of jargon and a modicum of graphic design, and you get something that appeals to lots of people who in a simpler and less financialized world would be working to cure cancer....
And besides, the banksters need to feel good about themselves, despite their enticing our best and brightest to create financial cancers rather than battle biological cancers. Matt Taibbi and Chrystia Freeland appeared on the new Bill Moyers television program on October 19, 2012, and provided an excellent explanation of why the banksters are so arrogant and self-righteous - and how President Obama basically shares their world-view. 
...the one thing that's consistent in my exposure to the financial services industry is that the people who work within it, and particularly the people... at the very, very top, sincerely believe that they have not done anything wrong.... And they also have built up this very, very powerful insulating psychological justification for their lifestyles. They've adopted this sort of Randian point of view, where... they genuinely believe that they are the wealth creators and that they should get every advantage and break whereas everybody else is a parasite and they're living off of them.... it's consistent with this mindset that there is an intellectual atmosphere that these people... have to work within in order to justify a lot of what they do, because you have to be completely disconnected from the real world in order to do things like sell fraudulent mortgages to a state pension fund. If you're actually thinking about that, you know, you're taking somebody's life savings away when you do that. But you can't think about that. 
Milton Friedman and the Rise of Monetary Fascism. James C. Kennedy really blasts away in The Dark Age of Money: Milton Friedman and the Rise of Monetary Fascism. Hat tip to ZeroHedge for pointing to Kennedy's piece.
Free market capitalism has become a thing of the past.  In truth free market capitalism has been replaced by something that is truly anti-free market and anti-capitalistic.... Beginning sometime around 1970 the U.S. and most of the ‘free world’ have diverged from traditional “free market capitalism” to something different.  Today the U.S. and much of the world’s economies are operating under what I call Monetary Fascism: a system where financial interests control the State for the advancement of the financial class....

Monetary Fascism has a strong preference for political rather than capital investments. These investments are designed to sustain and support the preferences and activities of the financial class as it manipulates and create ever larger out-sized rent opportunities or constructs risk-diverting transactions that aggregate a ‘risk-arbitrage premium’ to one side of a transaction and transfers all future losses to the other.

On a global basis Friedman’s ideas heavily influence international treaties on taxation and capital flows with the single minded goal of freeing capital from any obligation to the host or origin country. These agreements have essentially created a virtual nation, or non-nation, of money that is ultimately beyond the reach of the conventional Nation State. Friedman’s ‘invisible hand’ is free to extract the wealth of any corporation or Nation without any reciprocal obligations....

Milton Friedman and the Chicago School of economics claimed to have refined and developed modern, scientific tools of ‘free market capitalism’, capable of unlocking ever greater rewards from Adam Smith’s simple, primitive concept of free markets. Monetary Fascism was rapidly adopted because western culture recognizes the tremendous historical contributions of traditional free market capitalism and wanted to participate in the promise of these enhanced rewards.

In truth, it was nothing more than a cloak of deception – providing cover for the unscrupulous behavior of investment bankers, corporate raiders, speculators, off-shore corporation, debt mongers and bubble pushers (typically one and the same). The enhanced rewards came from the pilfering of capital investments and technology from generations past, the liquidation of employees and off-shoring of production, the pilfering of pension accounts and the termination or spin-out of R&D departments and option packages to executives....

Friedman’s model of wealth extraction has been in conflict with the traditional Nation State and the concept of State sovereignty from inception.

Great, you say! The state is evil and must be replaced with something new. Beware of this thinking. The evils of the state are nothing when compared to the money-counter. The State must answer to the public, or at least the mob. The money-counter only answers to his insatiable desire for more and more money.

Friedman’s ideology undermines State sovereignty by initially delinking the aggregation of wealth from the interest of the state. As wealth accumulates it is then used to alter political outcomes, tax avoidance and financial regulations for the benefit of the wealthy.

David Dayen points out why Rick Santelli was wrong in his proto-Tea Party rant, asking traders in the Chicago futures pits if they were willing to pay for their neigbor's mortgage: Homeowners Lost $2 Trillion in Housing Wealth By Living Near Foreclosures. Yeah, those unforeseen consequences...  

New details revealed of the "right wing money train" behind anti-science climate change denial. Hat tip to Kevin Grandia at FireDogLake for pointing to the new report.

David Dayen pointed to The Lasting Impact of 2010 Election: Redistricting Cementing Republican House Majority:
The Brennan Center has a report out today about post-2010 redistricting, and how it has tilted the map in favor of Republican control that may last regardless of the mood of the nation.... Before redistricting, the expected Congressional makeup, based on the partisan lean of the district, was 230-205 in favor of Republicans. Now it’s 241-194, a difference of 11 seats moving to the GOP. Here’s a perfect example where you can see the mapmakers’ hands at work. Before redistricting, in Republican-controlled states, there were 48 “marginal” districts, split somewhat evenly, with 29 marginal Republican seats and 19 marginal Democratic ones. After redistricting, the marginal seats reduced to 36, and an astounding 35 of them are marginal Republican. 

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