Saturday, May 30, 2015

HAWB 1801 - Alexander Hamilton and Albert Gallatin - How America Was Built

I just wanted to share something from a book written by Henry Adams in 1879, The Life of Albert Gallatin. Alexander Hamilton was our first Secretary of the Treasury, serving under George Washington. Albert Gallatin was the fourth, and longest serving, under Thomas Jefferson, then James Madison. They were political enemies - Washington's presidency, after all, was the triumph of the Federalists, while the administrations of Jefferson and Madison were the triumph of the Democratic Republicans. But that's not what I want to draw your attention to.

This excerpt from Adams' 1880 book does an excellent job of capturing the importance of Alexander Hamilton. Why is this noteworthy? Because Hamilton has been basically written out of mainstream economics. Which is pretty amazing, when you consider that Hamilton basically created the U.S. economy, from scratch, which surely has to be the greatest achievement in political economy in the past half millennia. I mean, we're talking about the USA economy here. And the guy who basically designed and launched it is not even mentioned in, for example, the most used introductory economics textbook? Which was written, please note, by conservative Harvard economics professor, H. Gregory Mankiw, who advised George W. Bush, and George Romney, and who actually published a paper in the Summer 2013 Journal of Economic Perspectives entitled - and I'm not making this up - "Defending the One Percent."

You think this doesn't mean anything? Well, I firmly believe one reason President Barack H. Obama persists in pushing the TPP and other free trade agreements is precisely because he was never taught that the ideas of Alexander Hamilton are a quite viable alternative to the market fundamentalism of asshats like Mankiw. An unblinking faith in the mystical ability of "free trade" to rain benefits and riches on everyone is an absolute, non-negotiable requirement, not only for inclusion in the mainstream economics profession ruled over by charlatans like Mankiw, but also for being included and counted among the "serious people" who are allowed to make economic policy.

Hamilton doesn't make the cut, because Hamilton, in word and in action, rejected all the tenets of modern neo-liberal economics. He believed a weak central government would result in the destruction of the new republic, and elaborated the concept of implied powers. He believed that the restless energies of entrepreneurs, financiers, and craftsmen needed to be given direction by statesmen who contemplated the good of the whole nation. And in a couple of important reports to Congress, which are basically the foundational documents of the USA economy, Hamilton demolished the arguments for free trade. Interesting: Bob Rubin's Hamilton Project never mentions that.

Henry Adams, by the way, was the grandson of John Quincy Adams and the great-grandson of John Adams. In his time, HA was one of the most influential political journalists and writers in the country.

The Life of Albert Gallatin, by Henry Adams. Published 1879, by J. B. Lippincott & Co. Text from the online version made available by Project Gutenburg.

 [Note: Emphasis are mine, not original.]
THE TREASURY. 1801-1813.
In governments, as in households, he who holds the purse holds the power. The Treasury is the natural point of control to be occupied by any statesman who aims at organization or reform, and conversely no organization or reform is likely to succeed that does not begin with and is not guided by the Treasury. The highest type of practical statesmanship must always take this direction. Washington and Jefferson doubtless stand pre-eminent as the representatives of what is best in our national character or its aspirations, but Washington depended mainly upon Hamilton, and without Gallatin Mr. Jefferson would have been helpless. The mere financial duties of the Treasury, serious as they are, were the least of the burdens these men had to carry; their keenest anxieties were not connected most nearly with their own department, but resulted from that effort to control the whole machinery and policy of government which is necessarily forced upon the holder of the purse. Possibly it may be said with truth that a majority of financial ministers have not so understood their duties, but, on the other hand, the ministers who composed this majority have hardly left great reputations behind them. Perhaps, too, the very magnitude and overshadowing influence of the Treasury have tended to rouse a certain jealousy in the minds of successive Presidents, and have worked to dwarf an authority legitimate in itself, but certainly dangerous to the Executive head. Be this as it may, there are, to the present time, in all American history only two examples of practical statesmanship which can serve as perfect models, not perhaps in all respects for imitation, but for study, to persons who wish to understand what practical statesmanship has been under an American system. Public men in considerable numbers and of high merit have run their careers in national politics, but only two have had at once the breadth of mind to grapple with the machine of government as a whole, and the authority necessary to make it work efficiently for a given object; the practical knowledge of affairs and of politics that enabled them to foresee every movement; the long apprenticeship which had allowed them to educate and discipline their parties; and finally, the good fortune to enjoy power when government was still plastic and capable of receiving a new impulse. The conditions of the highest practical statesmanship require that its models should be financiers; the conditions of our history have hitherto limited their appearance and activity to its earlier days.
The vigor and capacity of Hamilton’s mind are seen at their best not in his organization of the Treasury Department, which was a task within the powers of a moderate intellect, nor yet in the essays which, under the name of reports, instilled much sound knowledge, besides some that was not so sound, into the minds of legislature and people; still less are they shown in the arts of political management,—a field into which his admirers can follow him only with regret and some sense of shame. The true ground of Hamilton’s great reputation is to be found in the mass and variety of legislation and organization which characterized the first Administration of Washington, and which were permeated and controlled by Hamilton’s spirit. That this work was not wholly his own is of small consequence. Whoever did it was acting under his leadership, was guided consciously or unconsciously by his influence, was inspired by the activity which centred in his department, and sooner or later the work was subject to his approval. The results—legislative and administrative—were stupendous and can never be repeated. A government is organized once for all, and until that of the United States fairly goes to pieces no man can do more than alter or improve the work accomplished by Hamilton and his party.
What Hamilton was to Washington, Gallatin was to Jefferson, with only such difference as circumstances required. It is true that the powerful influence of Mr. Madison entered largely into the plan of Jefferson’s Administration, uniting and modifying its other elements, and that this was an influence the want of which was painfully felt by Washington and caused his most serious difficulties; it is true, too, that Mr. Jefferson reserved to himself a far more active initiative than had been in Washington’s character, and that Mr. Gallatin asserted his own individuality much less conspicuously than was done by Mr. Hamilton; but the parallel is nevertheless sufficiently exact to convey a true idea of Mr. Gallatin’s position. The government was in fact a triumvirate almost as clearly defined as any triumvirate of Rome. During eight years the country was governed by these three men,—Jefferson, Madison, and Gallatin,—among whom Gallatin not only represented the whole political influence of the great Middle States, not only held and effectively wielded the power of the purse, but also was avowedly charged with the task of carrying into effect the main principles on which the party had sought and attained power.
In so far as Mr. Jefferson’s Administration was a mere protest against the conduct of his predecessor, the object desired was attained by the election itself. In so far as it represented a change of system, its positive characteristics were financial. The philanthropic or humanitarian doctrines which had been the theme of Mr. Jefferson’s philosophy, and which, in a somewhat more tangible form, had been put into shape by Mr. Gallatin in his great speech on foreign intercourse and in his other writings, when reduced to their simplest elements amount merely to this: that America, standing outside the political movement of Europe, could afford to follow a political development of her own; that she might safely disregard remote dangers; that her armaments might be reduced to a point little above mere police necessities; that she might rely on natural self-interest for her foreign commerce; that she might depend on average common sense for her internal prosperity and order; and that her capital was safest in the hands of her own citizens. To establish these doctrines beyond the chance of overthrow was to make democratic government a success, while to defer the establishment of these doctrines was to incur the risk, if not the certainty, of following the career of England in “debt, corruption, and rottenness.” In this political scheme, whatever its merits or its originality, everything was made to depend upon financial management, and, since the temptation to borrow money was the great danger, payment of the debt was the great dogma of the Democratic principle. “The discharge of the debt is vital to the destinies of our government,” wrote Mr. Jefferson to Mr. Gallatin in October, 1809, when the latter was desperately struggling to maintain his grasp on the Administration; “we shall never see another President and Secretary of the Treasury making all other objects subordinate to this.” And Mr. Gallatin replied: “The reduction of the debt was certainly the principal object in bringing me into office.”
I think I would be remiss were I not to dwell, however quickly, on Adams' observation that Jefferson and Gallatin saw the greatest danger to be a national debt. Besides the historical irony that it is now, in our day, the conservatives and Republicans who are similarly afrighted by a national debt, I will point out that Jefferson and Gallatin were proven wrong by history, in quite brutal fashion, by the War of 1812, and in more congenial fashion, by their recourse to debt financing to complete the Louisiana purchase.

A national debt is not in and of itself a danger. It all depends on what you use that debt for.

One final note. I was directed to Adams' summary of Hamilton and Gallatin by a footnote in an excellent book by another Harvard professor, Thomas K. McCraw: The Founders and Finance: How Hamilton, Gallatin, and Other Immigrants Forged a New Economy (Harvard University Press, 2012). McCraw concludes that for all their political differences, Hamilton and Gallatin actually held remarkably similar views of the USA economy. They both strongly supported federal funding of internal improvements. Gallatin tried, but he could not sway Jefferson, and especially Madison, to his view on this issue (Madison would veto an internal improvements bill in 1817).

Both Hamilton and Gallatin wanted to promote domestic manufacturing, and as Treasury Secretary, both wrote a detailed report to Congress on the issue. Here is Hamilton's 1791 report. There is no similar copy on the internet I see for Gallatin's 1810 report, but here is an extremely brief summary.

McCraw writes that "the most revealing of all the views they held in common" was their support for the Bank of the United States.
Each expended herculean efforts on its behalf, and each had memorable disagreements with Thomas Jefferson, not only about this bank, but about all banks. Hamilton, with President Washington's support, was able to establish the Bank of the United States in 1791 and to make it an immediate success. Gallatin, without similar support from President Madison, could not get its charter renewed in 1811 - to the great detriment of the nation's financial situation as the War of 1812 began. Madison realized his mistake and in 1816 signed the bill creating the Second Bank of the United States.
Dr. McCraw passed on in November 2012. I can't help wondering if Mankiw and McCraw had spitball fights when they saw each other....

Thursday, May 28, 2015

Wolfgang Schäuble—neoliberal swine

In his landmark book, "Imperial Germany and the Industrial Revolution" Thorstein Veblen postulates the German was pulled by two competing cultural forces—the Prussians and the Industrialists—the Predators and the Geniuses who made German production world-class.  In the aftermath of World War I, Veblen's competing classes would descend into chaos because industry was crippled while the military was demoralized in spite of the fact that they hadn't really lost a battle.  A lot of blood-soaked stalemates but no French, British, or USA troops had set a boot on German soil.

Not surprisingly, the German governments staggered from one calamity to another.  In the mid 1920s, the problem was hyper-inflation.  But by 1930, the disaster was deflation and depression—by the end of 1932, unemployment in Berlin was estimated to be nearly 40% and there were actually people dying of starvation in the streets.  The Chancellor during this time was this blundering numbskull by the name of Heinrich Brüning whose economic mismanagement was so conservative (insane) that he would eventually be made a professor of Political Science at Harvard during his years in exile.

It isn't so hard to imagine what Brüning was like these days because his ghost lives on in the current German Finance Minister, Wolfgang Schäuble—an ignorant prick who thinks he is a towering success who has helped guide Germany to a position of absolute economic leadership of Europe.  In fact, he and his ilk have crippled Europe for a generation and even Germany under the crackpot leadership of the neoliberals is only a fraction of what it could be.  For those wondering why Schäuble is confined to a wheelchair—the answer is that he survived an assassination attempt.  Apparently he has been infuriating people for a very long time.

Wednesday, May 27, 2015

Palast on Robert Mundell and the Euro

Anyone who thinks that ideas don't matter should examine the career of Robert Mundell.  Yes, it can be argued that the zeitgeist of the late 1970s and early 80s was fertile ground for an organized reaction to the Keynesian school of economics and who provided the details was pretty much irrelevant.  Such arguments are usually based on the life and times of one Arthur Laffer who supposedly first sketched his justification for upper-income tax cuts on a cocktail napkin.  So even though Laffer calls himself the father of Supply-Side Economics, he was always a lightweight—another buffoon in the long history of lapdogs for the rich.  Mundell, OTOH, was as serious as a stroke.  And while his name has also been associated with Supply-Side, his work on the creation of the Euro ensures that no one will ever think he was a lightweight.

Regular readers around here are familiar with my thesis that the social failure of the Euro is directly traceable to its neoliberal design.  You could smell the massive unemployment and social chaos the Euro would bring the day the Maastricht Treaty was signed because it was designed to destroy democratic control over economic policies of importance.  And because that role of the Euro has been so successful, Mundell's creation will go down as one of the greatest triumphs of the idle rich—and they have had a bunch of them.

Tuesday, May 26, 2015

Taibbi on Iraq hypocrisy

One of the problems facing the elites who wish to buy elections or politicians is that the cognitive range of people who believe the official lies range from sub-moronic (Gohmert) to the merely clueless (Clinton).  This time around, it looks like we will be treated to some sort of competition for who can tell the slipperiest lies about their involvement in the rush to invade Iraq in 2003.  Of course, the big problem here is that the sort of moral courage necessary to stand up to the warmongering madness was the kind that would have sent anyone who had it into a political wilderness where roams only the ghosts of Robert LaFollette, Eugene Debs, Bertrand Russell and anyone else who ever made the mistake of questioning the warlike animus at full cry.  The arguments for invading Iraq were even less convincing than the steaming bullshit used to stampede us into WW I, so we now know how low that bar has been lowered.

What will make this process even more entertaining is that the overwhelming majority of journalists who were drawing a paycheck from what remained of the "mainstream press" waved their pom-poms for the Iraq invasion too.  So essentially what our "adversarial" press is really trying to do is have the presidential candidates conjure up a believable hypocrisy that lets everyone off the hook.

So it came to pass that some reporter came up with a question for Jeb Bush intended to reveal whether he was actually smarter than his goofy brother W.  "Knowing what he knows now, would he have made the same decision to invade Iraq?"  Took the poor bastard a week of false starts to come up with the right answer, which is NO!  If Jeb is actually smarter than his brother, the difference is microscopic.

We should expect the Iraq issue to go away soon for the simple reason that our rulers have never tolerated questions about war and peace for very long.  We will soon be back to the sort of issues our DC gossip-hounds can actually understand—sex and who's in with the in crowd.  And the choice for leading a once-interesting country will be reduced to whether someone gets caught having sex with a goat—in front of the baby goats.

Monday, May 25, 2015

No bullets left to fight a recession?

The world of central banking is often incomprehensible to me.  Since at least 1981 (and in many ways before that) they have, as announced public policy, "managed" the economy to make certain that virtually every useful human activity from fixing potholes, to building energy-efficient housing, to sharing out productivity gains with the producers who created them in the first place, to properly educating our children, and on and on, is economically "impossible."  This slum-landlord mentality on steroids has been sold as sane and proper economic governance.

Just remember, there is absolutely no rational reason to embrace an austerity agenda.  It isn't even good for the rich—yes their fictitious bank accounts grow to preposterous sizes while their policies are starving the real economy for necessary investment.  Good luck with your massively favorable computer banking data when the rising tides drown your fabulous shoreline property.

So now the central banksters have managed to push the globe into a looming recession even though they have lowered interest rates to near zero.  They tell us that when the inevitable results of their crackpot theories arrive, we will just have to suffer because...well for no reason other than when you think like a thief, causing pain is just part of your entertainment.  They will tell us they are out of ammunition to fight the problems they have caused with great enthusiasm.  Here we are, none other than HSBC (arguably the most corrupt bank in the history of the planet) telling us that there are no lifeboats.

Of course there are.  The central banks could EASILY fund the necessary activities for survival with the tools they already possess.  The only real difficulty is that the banksters would have to return to the world of the sane.  Sounds like an attractive proposition for the rest of us.

Thursday, May 21, 2015

De-carbonization—the new buzzword in climate change policy?

Today we have a cheery little piece from Deutsche Welle about the issues facing the upcoming climate change conference in Paris this Fall.  Keep in mind here that DW is an organ of the German government and that only a tiny handful of countries even come close to taking the issues of climate change as seriously as do the Germans.  So this article is about as enlightened as elected governments and mainstream media get.

We are in such trouble!  Start with the historically obvious fact that the climate change conferences have accomplished absolutely nothing of substance since that first one in Berlin in 1995.  I have charted the atmospheric CO2 concentrations against these well-intentioned but ultimately irrelevant conferences since then. So will Paris 2015 accomplish anything of substance?  I bet NO!

(click to enlarge)

There is one hopeful note.  The idea of decarbonization seems to have finally gotten a spot on the agenda.  Apparently, decarbonization is just a fancy term for doing away with fire—a strategy so obvious it occurred to me in the late 1980s.  Unfortunately, this is listed as a long-term goal, NOT a stop-everything-else-and-let's-do-it immediate objective.  So if you remove the possibility for a real solution, everything else is just window dressing.  Oh well, at least the Paris Conference attendees will have some excellent restaurants to choose from.

The we're-wrong-about-everything-else IMF has weighed in and their "solution" is to stop the $5.3 trillion in subsidies granted the fossil fuel industries.  Now I am sure that given a long enough time frame, making fuels more expensive will reduce demand.  In the meantime, such a move will cause enormous economic hardship for those of us who must either use fossil fuels or we die.  Learning to get along without fire will be the biggest cultural change in the history of the human race but our friends at IMF think that the problems will magically disappear with some tax-policy tinkering.

And of course, no one is even talking about the house-cleaning the economics profession must undertake to rid themselves of the austerity ghouls who preach belt-tightening when what we need is $trillions invested in the real economy.

Wednesday, May 20, 2015

Iceland's Pirate Party rethinks democracy

One of the primary fascinations of my life concerns the social changes that come from changes in communication technology.  It started with my childhood lessons that taught me there simply would not have been a Protestant Reformation without the invention of Gutenberg's printing press.  Many of Luther's teachings would have been ridiculous without printing—universal literacy, the priesthood of believers, congregational singing.  So naturally, I have been very curious about the social and political ramifications of the Internet—especially the ability to distribute high quality pictures and video.

The most obvious manifestation of the democratization of video is the exposure of corrupt and murderous policing practices.  Police have been beating up on the poor and racial minorities for a least a century but now these incidents show up on the Internet.  iPhone video was also partly responsible for Romney's political defeat when a bartender caught him talking like a country club jerk in front of his rich buddies.

I would offer some suggestions but I am handicapped by my slack-jawed awe when contemplating the social possibilities of the Internet / video revolution.  I remember distinctly where I was when I saw the for first time a video camera communicating with a desktop computer through a Firewire cable.  So I still think of these things as borderline miraculous.  But there are now young adults who have always lived in a world were such things are routine.  They won't get sidetracked by hardware awe and get straight to the subject of what can be done with the new technological possibilities.

The various Pirate Parties in Europe are essentially made up of young people who maintain the attitude that with the new ways to communicate, the world simply must change.  Not all of their ideas are enlightened, but most are pretty interesting.  And this example of what Icelandic Pirates are up to is especially interesting.  As it should be.  After all, the Icelanders have over a millennium of experience with democracy and are the direct descendants of Vikings—folks who once raised piracy to an art form.

Tuesday, May 19, 2015

Churches and the environment

We sang "This is my Father's World" at my grandfather's funeral.  He was a farmer in Southeastern Kansas who was passionate about caring for the land.  He put in terraces during the days of WPA to virtually eliminate soil erosion—terraces you can still see from space on Google maps.  So the idea that maximum conservation measures are a manifestation of religious devotion is not a new idea for me.  So when I see that Pope Francis is going to issue a Papal encyclical on climate change, my only reaction is, "What has taken you so long?"

I keep track of Catholic politics out of sheer curiosity.  After the glory days of Vatican II, ignoring the politics of that institution meant you were going to miss a LOT.  Unfortunately, the popes who followed John XXIII were comically reactionary who appointed extreme right-wing cardinals and bishops.  Here in USA, we got 45 years of abortion politics, a frontal assault on public education, and the destruction of the Progressive Democratic Party—among other baleful influences.

So now we find ourselves with a Pope who is actually interested in larger issues than sex (including the question of how Christians are supposed to act around issues like the environment).  And for some reason, I find this important.  As someone who got his fill of religious mumbo-jumbo growing up, I spent most of my adult life hoping that such forms of organized ignorance were just going to disappear.  Now in my old age, I am coming to the conclusion that religion will never go away because it fills too many holes in too many lives.

I have been watching in amazement at the return of the Orthodox Church in Russia.  Not only has Putin declared that he was baptized and wears his mother's cross for those shirtless photo shoots, but at the V-70 parade May 9th, the head of the Russian military, Defense Minister Shoigu crossed himself, Orthodox-style, to signal the parade was about to start.  Considering how thoroughly the Marxists tried to eliminate the influence of the Orthodox Church in USSR, it has made quite a comeback.

Yes, I know—religion will not solve a problem like climate change.  But making it a moral issue will help make up the minds of millions who will never understand the chemistry.

Monday, May 18, 2015

Hard times for farmers—again

This is a tale of what happens when times get tough for that quintessential Producer Class occupation—farming.  I tend to have a LOT of empathy for those who grow our food—they work harder than slaves, they are routinely called peasants or worse, all the while remaining the most economically vulnerable occupation on earth.  Think about it—when the economic tides turn people can relocate, factories can be moved to new locations, but a farm is by definition attached to a place.  So while you can move the farmer, you cannot move the farm.  So a farmer is attached to a location that is vulnerable to anything from outright military invasion, punitive tax policies, to something as whimsical as changing tastes in food.  I mean, I certainly did not believe I would ever see the day when wheat or milk was believed to be bad for us.  Even worse, when the farm goes down, for whatever reason, the farmer is thrown into a nearly bottomless economic pit where he loses his occupation, his sense of worth, the tools of his trade, his home, and probably at least part of his family who will blame him for his failure.  It's a LONG way down!  During the great industrialization, farmers forced from the land could get jobs in the booming factories, but this option doesn't much exist anymore.

Understand, this economic abyss isn't only felt in USA or North America.  The problems of farm failures in India make our problems look utterly insignificant.  These are problems of agriculture itself and as I have discovered from extensive reading on the subject, the cultural solutions date back as far as the Sumerians.

Here in Minnesota, I do not yet see actual distress in agriculture.  Most importantly, the folks who managed to escape the horror of the 1980s are the same folks who did not borrow recklessly (or other manifestation of Producer over-reach) and most have squirreled away at least part of the recent good times when high corn prices made it possible to believe in prosperity again.  But in all honesty, I don't think many will actually get paid to raise a crop this year.  It is probably a good thing everyone is driving a new pickup because there won't be many of those for a while.  Just remember that for a real farmer, a pickup is a tool, NOT a fashion statement so having a reliable one is good for the farm itself.

Thursday, May 14, 2015

New desalinization strategies

Supplying sufficient fresh water will continue to become an even bigger problem as the globe gets hotter and the population soars.  The world may be covered in water but only about 1% can be used by humans.  We know how to get salt out of sea water but so far the methods are expensive and use crazy amounts of energy.  But as the need grows and more engineering is thrown at the problem, solutions seem to become more realistic.  This is especially true as we enter an age when solar electricity is becoming more affordable—seemingly by the minute.  Because with enough cheap energy, massive desalinization it quite doable.  Even better, desalinization is one of those activities that are not necessarily time sensitive—so the machinery can run while the sun shines and shut down when it does not.  We might not live to see desalinization provide water for crop irrigation, but providing sufficient water for human consumption from the sea seems well with the abilities of of current engineering practices.

And there seems to be much more efficient ways to get the salt out in the lab stage.  Here we see a pilot project from MIT that seems to be just begging  to be scaled up to at least the size needed to provide for a medium-sized city.  Like so much in life, once the energy is available, the rest is pretty easy.  Well, not easy, but far from impossible.  And yes, there are still a lot of kinks to be worked out but working out kinks is what great engineering is all about.

Wednesday, May 13, 2015

Keeping the boot on China's neck with TPP

USA trade policy is so screwed up one wonders if anyone who understands the essential elements of production is ever consulted.  I mean, industrial skills that required generations of hard work and innovation to acquire have just been given to countries that offered nothing more than lax environmental regulation and low labor costs.  So after we take our industrial crown jewels and offshore them, we actually sit around wondering why we have mind-boggling trade deficits.  It MUST be currency manipulation.  It MUST be that those sneaky countries are cheating.  Everything, but the real problems that come from reducing this once interesting nation to the status of mere shoppers.

I am going to let Tony take on the these crazy "trade" agreements for the blog.  It's not that he is more pissed off about them than I, (I seriously doubt that would be possible) its because I am still worn out from all the energy I expended fighting NAFTA.  All that effort and all I have to show for it is the VERY minimal pleasure of saying "I told you so!"  Besides, Tony is really good at this sort of thing.

And fast track for TPP may in fact be defeated.  I still rate the possibility as very low because the pirates have had a long run of winning these sorts of things, but unlike the NAFTA fight, there are a LOT more people now who understand what these agreements actually mean for living standards.  So as the resistance to TPP becomes more organized, the arguments in favor become increasingly desperate and crazy.  So in the spirit of Predator Class madness, we see no less than the Council on Foreign Relations inform us that we need TPP or the nefarious and scary Chinamen will come and get us.

Tuesday, May 12, 2015

Popular rule—a sick lie

One of the more amazing things I discovered when I visited Finland in 1989 was that people my own age (39) were so well represented in the government.  I am not quite certain why that surprised me—after all, the Constitution sets the minimum age for being President at 35 and 30 for membership in the Senate.  And if one reads our history it is quite easy to discover people in their 30s that had important jobs.  Yet in the aftermath of the Vietnam War and the cultural revolution of the 60s, it was almost impossible to find anyone in the Boomer cohort who were expected to take on big-time adult responsibility.

There were several reasons why this was so.  1) The WW II generation was still very much in control of everything and showed no signs of relinquishing any of their power.  2) Many Boomers had managed to convince themselves that sex, drugs, and rock-and-roll WERE the important issues. 3) The antiwar movement left many of the best and brightest of the Boomer generation with criminal records and other blots on their records that made it easy to exclude them from any conversation where important matters were discussed.

Of course, these were just the latest excuses offered to justify the practices of making democracy irrelevant.  In colonial America, others excuses were made to limit power to property-owning male members of the Church of England—of British descent.  Today, the subjects of economics and "national security" have been put off limits to popular control.  Overwhelming majorities opposed the invasion of Iraq in 2003 and bailout of Wall Street in 2008 and it did not make one little bit of difference.  The "little people" had no voice in either matter.  And it did not matter one whit that in both cases, the voice of the people was overwhelmingly correct.

Monday, May 11, 2015

Parasite Capitalists

Once again, someone realizes that the Farmer's Alliance, the Populists, Thorstein Veblen (and about a million others who watched in horror and fury at the drooling Predators of industrialization who were looting the greatest burst of human genius in recorded history) were spot on in their critique of the Leisure Classes.  I know when it happened to me, the revelation just stunned me.  I mean, if someone compares the activities of an Elon Musk or a Steve Jobs with a Jamie Dimon or a George Soros, one could wonder how such different people could even be of the same species.  And yet, there are whole schools of thought with enthusiastic and loyal adherents who lump such completely different people with such different motivations under the heading of "Capitalism."  This intellectual laziness is mostly traceable to the musings of Marx but this foolishness lives on because unless one is exposed to the complexities of high-end production, there is little reason to suspect that banksters and integrated circuit production engineers are not in fact interchangeable.

So on this Monday in May, we should celebrate that one more person has seen the light.  And yes, Moore is absolutely correct—hedge funds are a pluperfect example of Leisure Class uselessness.  Worse, these thieves are sucking the very vitality out of the society that has made them "rich."  Yes indeed, the parasite can often kill the host.

Thursday, May 7, 2015

Ray McGovern on Vietnam 40 years later

With the 40th anniversary of the fall of Saigon and the end to the big military commitment in Vietnam, the time is probably right for taking stock one more time.  It is truly unfortunate that the catastrophes of that insane war were never discussed all that thoroughly because, with our collective failure to understand what went wrong, we have managed to stumble into many more foreign policy disasters.

At 65, I am about as young as anyone can be and still have personal memories of the acute ethical dilemmas that faced the young men of my generation. For example, if someone burned his draft card in 1965, he was probably arrested, tried, and sentenced to some serious jail time.  By 1969, someone doing the same thing was just ignored because there was no practical way to arrest everyone who did such things.  But even though it took less courage to oppose the USA invasion of Vietnam by the time I was a college freshman in 1968, it was still virtually impossible to know anything important about the issue.  I was a news junkie who watched the TV newscasts and read the daily papers quite religiously but it wasn't until the good books about Vietnam that came out in the 1980s that I had a clue what had really happened.

It wasn't that our class and younger didn't have anything useful to offer the antiwar movement.  But mostly we were ignorant kids who made decisions based mostly on the zeitgeist.  For many it wasn't anything more than "girls say yes to guys who say no" and other cultural clues.  So it is fascinating to read the reflections of someone like Ray McGovern who was both old enough and in a position to know what was going on while it was happening.  This meant he was in a position to suffer real consequences for telling the truth.  His ethical dilemmas were infinitely more acute than the guy who discovered that if he said something against the Vietnam War, some delicious lass was going to sleep with him that night.

Wednesday, May 6, 2015

Important site update—new video is coming

Back in February, I gave a speech on how someone would think if they were to take seriously the mega-problem of climate change.  The speech went well enough as these things go and it was captured by a videographer who knows how to take pictures.  But there were glitches like when the slides wouldn't advance smoothly, hemming and hawing, and assorted scenes where I really needed a drink of water.  A pass through the video editing program got rid of the most serious glitches, but I was left with the problem of WAY too much of me—talking head.  Worse, it ran slightly more than an hour and while I have long-posting privileges at Youtube, the chance of anyone watching such a beast was close to zero.

So, I have decided to divide the speech into more bite-sized chunks, cover the radical editing with some interesting b-roll, and post quality footage to both Youtube and Vimeo.  The point of these little movies is to provide video backup for a plan as outlined by Tony yesterday.  Essentially they will include:

1. The uselessness of protests—marching in circles

2. How we got into this mess—the ultimate seduction of fire

3. Class analysis and solutions—from the trap constructed by geniuses

4. How much would this cost?—and how do we get the money to pay for it?

One of the main reasons for all this video enthusiasm lies in the fact that I have finally upgraded my computing power.  Because I know how to get major results from Macs and wanted another, I was stuck with a narrow range of choices because Apple hasn't put a lot of effort into the big desktop box in recent years.  In fact, they don't really make one anymore.  But when they did make one, they were serious machines.  Expensive yes, but beautifully built.  So I got an early 2009 Mac Pro which was the least expensive version that will run the latest OS X (Yosemite).  Had to do some internal upgrades when I got it home but I now have the muscle to effectively edit high-def video.

Rumor has it that the Mac Pro is the computer that "saved" Pixar's Finding Nemo.  The big trick of that movie was realistic looking water.  But it took MAJOR horsepower to render.  The original Mac Pro still used the Motorola CPUs in the G5 models.  But they were inefficient and pumped out major heat so the case was made from machined aluminum, it had an open grate front and back, plus 11 fans.  Failure by Motorola to improve on these energy hogs is what drove Apple into the arms of Intel.  And Apple made the CPU changeover in time to save a kid's movie.  My new tool has a second-generation quad-core Intel chip.  It has just four fans and they almost never run unless I am doing something strenuous like rendering out an animation sequence or compressing video.

There are slide-out trays for 3.5" hard drives.  It is possible to have 24 tb of internal storage.  There is generous and well-ventilated space for PCI cards so really high-speed external storage is possible.  This box can easily be tricked out to do 4k video editing and the price for 4k is drifting down.

I am not quite done fiddling but I have already edited a two-minute video for a local environmental effort with it.  I am ready to rock and roll.

Monday, May 4, 2015

Replace the TPP with a $100 trillion world trade program

The TPP has brought the issue of "free trade agreements" to the fore again, so I think it is time we looked honestly at what has happened to the three North American countries in the grand-daddy FTA, the North American Free Trade Agreement (NAFTA). Let's look at the Big Picture of what has happened since NAFTA came into effect on January 1, 1994:

USA. In the 21 years since, the United States has devolved from a representative democratic republic with the most stable middle class and well paid working class in the world, into a plutocratic oligarchy, with the worst income inequality and the worst measures of social welfare of any western industrialized country, and a middle class that now lives a precarious existence, and a working class segments of which are now recording declines in life expectancies.

CANADA. Since NAFTA came into effect, Canada has regressed to a national economy dominated by an industry in resource extraction (oil and gas) - the traditional condition of colonial status. Certain circles in the USA now refer to Canada as "Texas of the north." Other reviews of the "success" of NAFTA in Canada have cited increased exports of beef, agricultural, wood and paper products, and mineral and mining products - all raw materials in which colonials typically specialize. The only advanced industrial sector to show growth has been automobile manufacturing - and this sector was already well established in Windsor, Ontario, immediately across the St. Clair River from Detroit.

MEXICO. Since the "blessing" of NAFTA, Mexico has fallen victim to the anarchy of ruthless, murderous illicit drug and criminal cartels. Ironically, one of the original arguments used by proponents of NAFTA was that increased trade would lead to more opportunities in the real economy for Mexican citizens, making it more difficult for drug cartels to operate in Mexico.

Syriza runs out of energy and ideas

While most people on the planet wanted Syriza to succeed with their strategy of politically confronting the Troika and their insatiable payment demands, most of us also had the sinking feeling that they were as likely to succeed as any other victim of a loan-sharking operation.  But instead of confronting some thugs willing to break your legs, Greece was up against heavy artillery—organized slander in the organs of the press, financial blackmail, and probably threats of real violence in the form of the Sixth Fleet.  No wonder Syriza is backing down.

The only reason for hope lies in the fundamental fact that there is simply no way Greece can pay those debts.  As Michael Hudson likes to remind us, debts that cannot be repaid will not be repaid.  So in the long run, the program Syriza was attempting to sell to the rest of Europe may ultimately end up looking like the reasonable plan after all.

The immediate reason for Syriza's failure lies in their unwillingness to leave the Euro.  I find this fact extremely interesting for a number of reasons:
  • It demonstrates the incredible desire of peoples of small nations to become members of a very exclusive club such as the EU / Euro.
  • It demonstrates the incredible power of the neoliberal narrative. Even though the neoliberal assumptions make Scientology look positively rational, the European "left" seems unable to understand important monetary concepts with enough clarity to muster a meaningful response.  And while it was great fun watching Greece try to guilt-trip the Germans, that was hardly going to be enough.
  • It shows how few people are actually willing to stand up against the banksters—there's an incredible amount of cowardice out there folks.
The neoliberal agenda simply must be stopped.  And just because Greece was not big or strong enough to stop it doesn't mean they were wrong to try.